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No. 184058: March 10, 2010



Appellant was indicted for Illegal Recruitment (Large Scale)
and for five counts of Estafa in violation of Article 38 (a) of
the the New Labor Code of the Philippines, in relation to Art.
13 (b) and (c ) thereof, as further amended by Sec. 6 (a), (1)
and (m) of RA 8042.

Appellant denied the charges.Claiming having worked as a
temporary cashier from January to October, 2002 at the office
of Golden Gate, owned by one Marilyn Calueng, she
maintained that Golden Gate was a licensed recruitment
agency and that Josie, who is her godmother, was an agent.

Admitting having receivedP80,000 each from Marilyn and
Tan, receipt of which she issued but denying receiving any
amount from King, she claimed that she turned over the
money to the documentation officer, one Arlene Vega, who in
turn remitted the money to Marilyn Calueng whose present
whereabouts she did not know.

The RTC convicted appellant of Illegal Recruitment (Large
Scale) and three counts of Estafa. On appeal, the CA affirmed
the RTCs decision holding that appellants defense that, as
temporary cashier of Golden Gate, she received the money
which was ultimately remitted to Marilyn Calueng is
immaterial, she having failed to prove the existence of an
employment relationship between her and Marilyn, as well as
the legitimacy of the operations of Golden Gate and the extent
of her involvement therein.

Hence, this appeal.

ISSUE: Whether or not the appellant is guilty of illegal

HELD: The appeal is denied.


The term recruitment and placement is defined under Article
13(b) of the Labor Code of the Philippinesas 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 inrecruitment and placement. On the other hand,
illegal recruitment is defined under Article 38, paragraph (a)
of the Labor Code, as amended.

From the foregoing provisions, it is clear that anyrecruitment
activities to be undertaken by non-licensee or non-holder of
contracts, or as in the present case, an agency with

SBCA 2nd Sem SY 15-16

anexpiredlicense,shall be deemedillegal and punishable

under Article 39 of the Labor Code of the Philippines.And
illegal recruitment is deemed committed inlarge scale if
committed against three or more persons individually or as a

Thus forillegal recruitment in large scale to prosper, the
prosecution has to prove three essential elements, to wit: (1)
the accused undertook arecruitment activity under Article
13(b) or any prohibited practice under Article 34 of the
Labor Code; (2) the accused did not have the license or the
authority to lawfully engage in therecruitment and placement
of workers; and (3) the accused committed such illegal
activity against three or more persons individually or as a

In the present case, Golden Gate, of which appellant admitted
being a cashier from January to October 2002, was initially
authorized to recruit workers for deployment abroad.Per the
certification from the POEA,Golden Gates license only expired
on February 23, 2002 and it was delisted from the roster of
licensed agencies on April 2, 2002.

Appellant was positively pointed to as one of the persons
who enticed the complainants to part with their money upon
the fraudulent representation that they would be able to
secure for them employment abroad.In the absence of any
evidence that the complainants were motivated by improper
motives, the trial courts assessment of their credibility shall
not be interfered with by the Court.

Even if appellant were a mere temporary cashier of Golden
Gate, that did not make her any less an employee to beheld
liable for illegal recruitment as principal by direct
participation, together with the employer, as it was shown
that she actively and consciously participated in the
recruitment process.

Assuming arguendo that appellant was unaware of the illegal
nature of the recruitment business of Golden Gate that does
not free her of liability either.Illegal Recruitment in Large
Scale penalized under Republic Act No. 8042, or The Migrant
Workers and Overseas Filipinos Act of 1995, is a special law,
a violation of which is malum prohibitum,not malum in se.
Intent is thus immaterial. And that explains why appellant
was, aside from Estafa, convicted of such offense.


G.R. No. 187730: June 29, 2010

GALLO y GADOT, Accused-Appellant.



Accused-appellant Gallo and accused Pacardo and Manta
together with Mardeolyn and 9 others, were charged with


AKD Digests 1

syndicated illegal recruitment and 18 counts of

estafacommitted against eighteen complainants, including
Dela Caza, Guantero and Sare. The present appeal concerns
solely accused-appellants conviction for syndicated illegal
recruitment in Criminal Case No. 02-206293 and for estafain
Criminal Case No. 02-206297. According to the prosecution,
Dela Caza was introduced by Panuncio to accused-appellant
Gallo, Pacardo, Manta, Mardeolyn, Lulu Mendanes, Yeo Sin
Ung and another Korean national at the office of MPM Agency
located in Malate, Manila. Accused-appellant Gallo then
introduced himself as a relative of Mardeolyn and informed
Dela Caza that the agency was able to send many workers
abroad. Together with Pacardo and Manta, he also told Dela
Caza about the placement fee of PhP150,000 with a down
payment of PhP45,000 and the balance to be paid through
salary deduction. With accused-appellants assurance that
many workers have been sent abroad, as well as the presence
of the 2 Korean nationals and upon being shown the visas
procured for the deployed workers, Dela Caza was convinced
to part with his money and paid the agency. After 2 weeks,
the said agency moved and changed their name. After 2 more
months of waiting in vain to be deployed, Dela Caza and the
other applicants decided to take action. The first attempt was
unsuccessful because the agency again moved to another
place. However, with the help of the Office of Ambassador
Seres and the Western Police District, they were able to
locate the new address at Carriedo, Manila. The agency
explained that it had to move in order to separate those who
are applying as entertainers from those applying as factory
workers. Accused-appellant Gallo, together with Pacardo and
Manta, were then arrested. For his defense, accused-
appellant denied having any part in the recruitment of Dela
Caza. In fact, he testified that he also applied with MPM
Agency for deployment to Koreaas a factory worker. RTC and
CA convicted the appellants.

ISSUE: Whether or not accused-appellant is guilty of illegal
recruitment committed by a syndicate.
HELD: Yes.


To commit syndicated illegal recruitment, three elements
must be established: (1) the offender undertakes either any
activity within the meaning of recruitment and placement
defined under Article 13(b), or any of the prohibited
practices enumerated under Art. 34 of the Labor Code; (2) he
has no valid license or authority required by law to enable
one to lawfully engage in recruitment and placement of
workers; and (3) the illegal recruitment is committed by a
group of three (3) or more persons conspiring or
confederating with one another. When illegal recruitment is
committed by a syndicate or in large scale, i.e., if it is
committed against three (3) or more persons individually or
as a group, it is considered an offense involving economic
sabotage.Under Art. 13(b) of the Labor Code, recruitment and
placement refers to any act of canvassing, enlisting,
contracting, transporting, utilizing, hiring or procuring
workers, and includes referrals, contract services, promising

SBCA 2nd Sem SY 15-16

or advertising for employment, locally or abroad, whether for

profit or not. SC believes that the prosecution was able to
establish the elements of the offense sufficiently. The
evidence readily reveals that MPM Agency was never
licensed by the POEA to recruit workers for overseas
employment. In the instant case, accused-appellant
committed the acts enumerated in Sec. 6 of R.A. 8042.
Testimonial evidence presented by the prosecution clearly
shows that, in consideration of a promise of foreign
employment, accused-appellant received the amount of Php
45,000.00 from Dela Caza. When accused-appellant made
misrepresentations concerning the agencys purported power
and authority to recruit for overseas employment, and in the
process, collected money in the guise of placement fees, the
former clearly committed acts constitutive of illegal

G.R. No. 179532: May 30, 2011




Petitioner was employed as an electrician of the vessel, M/T
SEASCOUT by Intermare Maritime Agencies, Inc. in behalf of
its principal, Vulture Shipping Limited.The contract was for
12 months.On 23 August 2001,Yapboarded M/T SEASCOUT
and commenced his job as electrician. However, on or about
08 November 2001, the vessel was sold.

Yap received his seniority bonus, vacation bonus, extra bonus
along with the scrapping bonus.However, he insisted that he
was entitled to the payment of the unexpired portion of his
contract since he was illegally dismissed from
employment.He alleged that he opted for immediate transfer
but none was made.

Respondents contended that Yap was not illegally
dismissed.They further alleged that Yaps contract was validly
terminated due to the sale of the vessel and no arrangement
was made for Yaps transfer to Thenamaris other vessels.

Thus, Yap brought the issue before the Labor Arbiter (LA)
which ruled that petitioner was illegally dismissed; that
respondents acted in bad faith when they assured petitioner
of re-embarkation but he was not able to board; and that
petitioner was entitled to his salaries for the unexpired
portion of his contract for a period of nine months
(US$12,870.00), P100,000 for moral damages, and P50,000
for exemplary damages with 10% of the same for Attys fees.

Respondents sought recourse from the NLRC which modified
the award of salaries from that corresponding to nine months
to only three months (US$4,290.00) pursuant to Section 10
R.A. No. 8042.


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Respondents and petitioner both filed a Motion for Partial

NLRC affirmed the finding of Illegal Dismissal and Bad Faith
on the part of respondent. However, the NLRC reversed its
earlier Decision, holding that "there can be no choice to grant
only 3 months salary for every year of the unexpired term
because there is no full year of unexpired term which this can
be applied."

Respondents filed an MR, which the NLRC denied.
Undaunted, respondents filed a petition forcertiorariunder
Rule 65 before the CA.

The CA affirmed the findings and ruling of the LA and the
NLRC. However, the CA ruled that the NLRC erred in
sustaining the LAs interpretation of Section 10 of R.A. No.
8042. The CA relied on the clause "or for three months for
every year of the unexpired term, whichever is less" provided
in the 5th paragraph of Section 10 of R.A. No. 8042.

Both parties filed their respective MRs which the CA denied.
Thus, this petition.


[1] Whether Section 10 of R.A. 8042, to the extent that it
affords an illegally dismissed migrant worker the lesser benefit
of "salaries for [the] unexpired portion of his employment
contract for three (3) months for every year of the unexpired
term,whichever is less" is constitutional;

[2] Assuming that it is, whether the CA gravely erred in
granting petitioner only three (3) months backwages when his
unexpired term of 9 months is far short of the "every year of the
unexpired term" threshold.

HELD: The petition is impressed with merit.

We have previously declared that the clause "or for three
months for every year of the unexpired term, whichever is
less" is unconstitutional for being violative of the rights of
(OFWs) to equal protection. Moreover, the subject clause
does not state any definitive governmental purpose, hence, it
also violates petitioner's right to substantive due process.

Generally, an unconstitutional act is not a law. An exception
to this is the doctrine of operative fact applied when a
declaration of unconstitutionality will impose an undue

SBCA 2nd Sem SY 15-16

burden on those who have relied on the invalid law. This case
should not be included in the exception. It was not the fault of
petitioner that he lost his job due to an act of illegal dismissal
committed by respondents.

Also, we cannot subscribe to respondents postulation that
the tanker allowance of US$130.00 should not be included in
the computation of the lump-sum salary. First, fair play,
justice, and due process dictate that this Court cannot now,
for the first time on appeal, pass upon this question. Second,
the allowance was encapsulated in the basic salary clause.

People of the Philippines vs. Domingo Panis
GR No. L5867477, July 11, 1990


On January 9, 1981, four information were filed in the in the
Court of First Instance (CFI) of Zambales and Olongapo City
alleging that herein private respondent Serapio Abug,
"without first securing a license from the Ministry of Labor as
a holder of authority to operate a fee-charging employment
agency, did then and there wilfully, unlawfully and criminally
operate a private fee charging employment agency by
charging fees and expenses (from) and promising
employment in Saudi Arabia" to four separate individuals.
Abug filed a motion to quash contending that he cannot be
charged for illegal recruitment because according to him,
Article 13(b) of the Labor Code says there would be illegal
recruitment only "whenever two or more persons are in any
manner promised or offered any employment for a fee.

Denied at first, the motion to quash was reconsidered and
granted by the Trial Court in its Orders dated June 24, 1981,
and September 17, 1981. In the instant case, the view of the
private respondents is that to constitute recruitment and
placement, all the acts mentioned in this article should
involve dealings with two or more persons as an
indispensable requirement. On the other hand, the petitioner
argues that the requirement of two or more persons is
imposed only where the recruitment and placement consists
of an offer or promise of employment to such persons and
always in consideration of a fee.


Whether or not Article 13(b) of the Labor Code provides for
the innocence or guilt of the private respondent of the crime
of illegal recruitment


The Supreme Court reversed the CFIs Orders and reinstated
all four information filed against private respondent.


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The Article 13(b) of the Labor Code was merely intended to
create a presumption, and not to impose a condition on the
basic rule nor to provide an exception thereto.

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. The words
"shall be deemed" create the said presumption.

[G.R. No. 109583. September 5, 1997.]


Private respondents sought employment as domestic helpers
through petitioner's employees. The applicants paid
placement fees ranging from P1,000.00 to P14,000.00, but
petitioner failed to deploy them. Their demand for refund
proved unavailing; thus, they were constrained to institute
complaints against petitioner for violation of Articles 32 and
34(a) of the Labor Code, as amended. The Undersecretary of
Labor found that the petitioner is liable for 28 counts of
violation of Article 32 and 5 counts of Art. 34(a) and ordered
the cancellation of its license to participate in
the overseas placement and recruitment of workers. The
cancellation of petitioner's license was temporarily lifted but
the order revoking its license was reinstated when the
petitioner's motion for reconsideration was eventually
denied for lack of merit. The issue presented in the case at
bar is whether or not the Secretary of Labor and Employment
has jurisdiction to cancel or revoke the license of a private fee
charging employment agency. LibLex
The Supreme Court ruled that the power to suspend or cancel
any license or authority to recruit employees
for overseas employment is concurrently vested with the
Philippine Overseas Employment Authority (POEA) and the
Secretary of Labor.

ISSUE: whether or not the Secretary of Labor and
Employment has jurisdiction to cancel or revoke the license
of a private fee-charging employment agency.


The power to suspend or cancel any license or authority to
recruit employees for overseas employment is vested upon
the Secretary of Labor and Employment under Article 35 of
the Labor Code, as amended. In the case of Eastern Assurance
and Surety Corp. vs. Secretary of Labor, 181 SCRA 110 (1990),
we held that: "The penalties .of suspension and cancellation

SBCA 2nd Sem SY 15-16

of license or authority are prescribed for violations of the

abovequoted provisions, among others. And the Secretary of
Labor has the power under Section 35 of the law to apply these
sanctions, as well as the authority, conferred by Section 36,
not only to 'restrict 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. Pursuant
to this rule-making power thus granted, the Secretary of
Labor gave the POEA, 'on its own initiative or upon filing of a
complaint or report or upon request for investigation by any
aggrieved person, . . . (authority to) conduct the necessary
proceedings for the suspension or cancellation of the license
or authority of any agency or entity' for certain enumerated
offenses including 1) the imposition or acceptance,
directly or indirectly, of any amount of money, goods or
services, or any fee or bond in excess of what is prescribed by
the Administration, and 2) any other violation of pertinent
provisions of the Labor Code and other relevant laws, rules
and regulations. The Administrator was also given the power
to 'order the dismissal of the case or the suspension of the
license or authority of the respondent agency or contractor
or recommend to the Minister the cancellation thereof." This
power conferred upon the Secretary of Labor and
Employment was echoed in People vs. Diaz, 259 SCRA 441
(1996), viz.: "A non-licensee or non-holder of authority
means any person, corporation or entity which has not been
issued a valid license or authority to engage in recruitment
and placement by the Secretary of Labor, or whose license or
authority has been suspended, revoked or cancelled by the
POEA or the Secretary." In view of the Court's disposition on
the matter, we rule that the power to suspend or cancel any
foroverseas employment is concurrently vested with the
POEA and the Secretary of Labor. prLL

[G.R. No. 167639. April 19, 2006.]

Two separate complaints filed before the Philippine Overseas
Employment Administration (POEA)
against Principalia Management and Personnel Consultants,
Incorporated (Principalia) for violation of the 2002 POEA
Rules and Regulations.
Concha alleged that in August 2002, she applied
with Principalia for placement and employment as caregiver
or physical therapist in the USA or Canada. Despite paying
P20,000.00 out of the P150,000.00 fee required
by Principalia which was not properly
receipted, Principalia failed to deploy Concha for
employment abroad. In its March 15, 2004 Order, 4 the


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Adjudication Office of the POEA found Principalia liable for

violations of the 2002 POEA Rules and Regulations
Principalia moved for reconsideration which the POEA
granted on June 25, 2004. 7 The latter lifted its order
suspending the documentary processing byPrincipalia after
noting that it exerted efforts to obtain overseas employment
for Baldoza within the period stipulated in the settlement
agreement but due to Baldoza's lack of qualification, his
application was declined by its foreign principal.
Meanwhile, on June 14, 2004, or before the promulgation of
POEA's order lifting the suspension, Principalia filed a
Complaint 8 (Complaint) against Rosalinda D. Baldoz in her
capacity as Administrator of POEA and Atty. Jovencio R.
Abara in his capacity as POEA Conciliator, before the
Regional Trial Court (RTC) of Mandaluyong City for
"Annulment of Order for Suspension of Documentation
Processing with Damages and Application for Issuance of a
Temporary Restraining Order and/or Writ of Preliminary
Injunction, and a Writ of Preliminary Mandatory
Injunction." Principalia claimed that the suspension of its
documentary processing would ruin its reputation and
goodwill and would cause the loss of its applicants,
employers and principals. Judge Paulita B. Acosta-Villarante
of the RTC of Mandaluyong City, Branch 211, granted a 72-
hour restraining order enjoining Administrator Baldoz and
Atty. Abara to refrain from imposing the suspension orders
before the matter can be heard in full
Petitioner assails the September 20, 2004 Resolution 1 of the
Court of Appeals in CA-G.R. SP No. 86170, dismissing outright
the petition for certiorari for failure to attach copies of all
relevant pleadings and transcripts of the hearings, as well as
the March 29, 2005 Resolution 2 denying the motion for

core issues for resolution are as follows: (1) whether the
Court of Appeals erred in dismissing the Petition
for Certiorari based on purely technical grounds; and (2)
whether the trial court erred in issuing the writ of
preliminary injunction

In the case at bar, the Court of Appeals dismissed the petition
for certiorari due to POEA's failure to attach the following
relevant documents. The trial court did not decree that the
POEA, as the granting authority of Principalia's license to
recruit, is not allowed to determine Principalia's compliance
with the conditions for the grant, as POEA would have us
believe. For all intents and purposes, POEA can determine
whether the licensee has complied with the requirements. In
this instance, the trial court observed that the Order of
Suspension dated March 15, 2004 was pending appeal with
the Secretary of the Department of Labor and Employment
(DOLE). Thus, until such time that the appeal is resolved with
finality by the DOLE, Principalia has a clear and convincing
right to operate as a recruitment agency.
Furthermore, irreparable damage was duly proven
by Principalia. Suspension of its license is not easily
quantifiable nor is it susceptible to simple mathematical

SBCA 2nd Sem SY 15-16

computation, as alleged by POEA. Moreover, POEA would

have no authority to exercise its regulatory functions
over Principalia because the matter had already been
brought to the jurisdiction of the DOLE. Principalia has been
granted the license to recruit and process documents for
Filipinos interested to work abroad. Thus, POEA's action of
suspending Principalia's license before final adjudication by
the DOLE would be premature and would amount to a
violation of the latter's right to recruit and deploy workers.
Finally, the presumption of regular performance of duty by
the POEA under Section 3 (m), Rule 131 of the Rules of Court,
finds no application in the case at bar, as it applies only
where a duty is imposed on an official to act in a certain way,
and assumes that the law tells him what his duties are.
The issue threshed out before the trial court was whether the
order of suspension should be implemented pending appeal.
It did not correct a ministerial duty of the POEA. As such, the
presumption on the regularity of performance of duty does
not apply.

WHEREFORE, in light of the foregoing, the petition is DENIED
for lack of merit.

[G.R. No. 156029. November 14, 2008.]


Sometime in 1989,
respondent First Cosmopolitan Manpower & Promotion
Services, Inc. recruited petitioner Santosa B. Datuman to
work abroad as a Saleslady in Bahrain with a salary of
$370.00 for a period of 1 year as stipulated in the contract.
However, her employer Mohammed Hussain took her
passport when she arrived there; and instead of working as a
saleslady, she was forced to work as a domestic helper with a
salary of Forty Bahrain Dinar (BD40.00), equivalent only to
One Hundred US Dollars (US$100.00). This was contrary to
the agreed salary of US$370.00 indicated in her Contract of
Employment signed in the Philippines and approved by the
Philippine Overseas Employment Administration (POEA).
On September 1, 1989, her employer compelled her to sign
another contract, transferring her to another employer as
housemaid with a salary of BD40.00 for the duration of two
(2) years. 4 She pleaded with him to give her a release paper
and to return her passport but her pleas were unheeded. Left
with no choice, she continued working against her will.
Worse, she even worked without compensation from
September 1991 to April 1993 because of her employer's
continued failure and refusal to pay her salary despite
demand. In May 1993, she was able to finally return to the
Philippines through the help of the Bahrain Passport and
Immigration Department. 5

In May 1995, petitioner filed a complaint before the POEA
Adjudication Office against respondent for underpayment


AKD Digests 5

and nonpayment of salary, vacation leave pay and refund of

her plane fare. While the case was pending, she filed the
instant case before the NLRC for underpayment of salary for
a period of one year and six months, nonpayment of vacation
pay and reimbursement of return airfare. EHSITc
respondent countered that petitioner actually agreed to work
in Bahrain as a housemaid for one (1) year because it was the
only position available then. However, since such position
was not yet allowed by the POEA at that time, they mutually
agreed to submit the contract to the POEA indicating
petitioner's position as saleslady. Respondent added that it
was actually petitioner herself who violated the terms of
their contract when she allegedly transferred to another
employer without respondent's knowledge and approval.
Lastly, respondent raised the defense of prescription of cause
of action since the claim was filed beyond the three (3)-year
period from the time the right accrued, reckoned from either
1990 or 1991.

On April 29, 1998, Labor Arbiter Jovencio Mayor, Jr. rendered
a Decision finding respondent liable for violating the terms of
the Employment Contract and ordering it to pay petitioner.
On appeal, the NLRC, Second Division, issued a
Decision 10 affirming with modification the Decision of
Labor Arbiter Mayor, Jr., by reducing the award of salary
differentials from US$4,050.00 to US$2,970.00. On August 7,
2002, the CA issued the assailed Decision 15 granting the
petition and reversing the NLRC and the Labor Arbiter.

ISSUE: to whether the CA erred in not holding respondent
liable for petitioner's money claims pursuant to their
Contract of Employment.


Section 1 of Rule II of the POEA Rules and Regulations is clear
that the private employment agency shall assume joint and
solidary liability with the employer. 19 This Court has, time
and again, ruled that private employment agencies are held
jointly and severally liable with the foreign-based
employer for any violation of the recruitment agreement or
contract of employment. 20 This joint and solidary liability
imposed by law against recruitment agencies and foreign
employers is meant to assure the aggrieved worker
of immediate and sufficient payment of what is due
him. 21 This is in line with the policy of the state to protect
and alleviate the plight of the working class.
In the assailed Decision, the CA disregarded the aforecited
provision of the law and the policy of the state when it
reversed the findings of the NLRC and the Labor Arbiter. As
the agency which recruited petitioner, respondent is jointly
and solidarily liable with the latter's principal employer
abroad for her (petitioner's) money claims. Respondent
cannot, therefore, exempt itself from all the claims and
liabilities arising from the implementation of their POEA-
approved Contract of Employment.
We cannot agree with the view of the CA that the solidary
liability of respondent extends only to the first contract
(i.e. the original, POEA-approved contract which had a term

SBCA 2nd Sem SY 15-16

of until April 1990). The signing of the "substitute" contracts

with the foreign employer/principal before the expiration of
the POEA-approved contract and any continuation of
petitioner's employment beyond the original one-year term,
against the will of petitioner, are continuing breaches of the
original POEA-approved contract. To accept the CA's
reasoning will open the floodgates to even more abuse of our
overseas workers at the hands of their foreign employers and
local recruiters, since the recruitment agency could easily
escape its mandated solidary liability for breaches of the
POEA-approved contract by colluding with their foreign
principals in substituting the approved contract with another
upon the worker's arrival in the country of employment. Such
outcome is certainly contrary to the State's policy of
extending protection and support to our overseas workers.
To be sure, Republic Act No. 8042 explicitly prohibits the
substitution or alteration to the prejudice of the worker of
employment contracts already approved and verified by the
Department of Labor and Employment (DOLE) from the time
of actual signing thereof by the parties up to and including
the period of the expiration of the same without the approval
of the DOLE.
Hence, in the present case, the diminution in the salary of
petitioner from US$370.00 to US$100 (BD40.00) per month
is void for violating the POEA-approved contract which set
the minimum standards, terms, and conditions of her
employment. Consequently, the solidary liability of
respondent with petitioner's foreign employer for
petitioner's money claims continues although she was forced
to sign another contract in Bahrain. It is the terms of the
original POEA-approved employment contract that shall
govern the relationship of petitioner with the respondent
recruitment agency and the foreign employer. We agree with
the Labor Arbiter and the NLRC that the precepts of justice
and fairness dictate that petitioner must be compensated
for allmonths worked regardless of the supposed termination
of the original contract in April 1990. It is undisputed that
petitioner was compelled to render service until April 1993
and for the entire period that she worked for the foreign
employer or his unilaterally appointed successor, she should
have been paid US$370/month for every month worked in
accordance with her original contract. HTSIEa
This Court reminds local recruitment agencies that it is their
bounden duty to guarantee our overseas workers that they
are being recruited for bona fidejobs with bona
fide employers. Local agencies should never allow themselves
to be instruments of exploitation or oppression of their
compatriots at the hands of foreign employers. Indeed, being
the ones who profit most from the exodus of Filipino workers
to find greener pastures abroad, recruiters should be first to
ensure the welfare of the very people that keep their industry
alive. CAaSHI
WHEREFORE, the petition is GRANTED. The assailed Decision
of the Court of Appeals dated August 7, 2002 and Resolution
dated November 14, 2002 in CA-G.R. SP No. 59825 are
REVERSED AND SET ASIDE. The Decision of the National
Labor Relations Commission dated February 24, 2000 is
REINSTATED with a qualification with respect to the award


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of salary differentials, which should be granted for the period

May 31, 1992 to April 1993 and not May 1993 to April 1994.

[G.R. No. 177498. January 18, 2012.]

MANAGEMENT, petitioners,vs. SULPECIO
MEDEQUILLO, JR., respondent.

The most recent case of Stolt-Nielsen Transportation Group,
Inc. and Chung Gai Ship Management vs. Sulpecio Medequillo,
Jr. (G.R. No. 177498, January 18, 2012) confirms the standing
rule that a seafarer must indeed be compensated as a result
of the unreasonable failure of his employer to deploy him
notwithstanding his execution of an employment contract
duly approved by the POEA.

In the above-cited case, the seafarer was initially hired by his
employers as Third Assistant Engineer on board an ocean-
going vessel for nine (9) months. After barely three (3)
months of service, he was ordered to be repatriated by the
ship master. Upon his return to Manila, he was transferred
employment by his employers with another vessel for the
same period of nine (9) months under the first contract. His
second contract was approved by the POEA. Despite the
commencement of his second contract however, his
employers refused to deploy him for no apparent reason. Left
with no other choice, the seafarer filed a case for illegal
dismissal for the first contract and for failure to deploy under
the second contract. The arbiter, the NLRC, and the Court of
Appeals all ruled for the seafarer, agreeing that while the
employers cannot be held liable under the first contract since
the second contract novated it, the employers are liable for
breach of the second contract.

The Supreme Court likewise sided with the seafarer, finding
that there was a novation of the first contract. On the matter
of the non-deployment of the seafarer without any valid
reason, the High Court explained that the seafarer has a
remedy in such a case even if the employment contract has
not yet commenced and he has yet to actually depart from
the airport or seaport in the port of hire. For clarity, the Court
distinguished between the perfection of contract on the one
hand, which took place when the parties agreed on the object
and the cause as well as the terms of the contract, and
commencement of the employer-employee relationship on
the other hand, when the seafarer would have been actually
deployed. The perfection of contract brings about certain
rights, the breach of which may give rise to a cause of action.
Ta-king note of the case of Santiago v. CF Sharp Crew
Management, Inc. (G.R. No. 162419, July 10, 2007), the Court
observed that since there was non-deployment of the
seafarer herein which constituted as a breach by the
employers of the parties agreement, the employers are liable
to pay the seafarer actual damages in the form of the loss of
nine (9) months worth of salary as stated in the employment

SBCA 2nd Sem SY 15-16

[G.R. No. 121777. January 24, 2001.]

THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs.

Erlie Ramos, an attorney of the POEA, received a call from an
unidentified woman inquiring about the legitimacy of the
recruitment conducted by Mrs. Carol Figueroa. Ramos
conferred with the CIS to organize the arrest of the alleged
illegal recruiter. The group planned the entrapment the next
day with Eileen Fermindoza to pose as an applicant. The plan
materialized the next day, which caused the CIS team to bring
Figueroa, a certain Jasmine Alejandro, and three women
applicants to the office for investigation. In the course of the
investigation, it turned out that Figueroa had many aliases,
among them Carol Llena and Carol de la Piedra. A check by
Ramos with the POEA revealed that she was not licensed nor
authorized to conduct recruitment. Figueroa was charged
before the Regional Trial Court of illegal recruitment in Large
Scale. Denial comprised the accuseds' defense. The trial court
convicted the accused and sentenced her to life
imprisonment. Accused-appellant questioned her conviction
for illegal recruitment in large scale and assailed the
constitutionality of the law.
The Supreme Court affirmed the constitutionality of the law
and the conviction of the accused, but reduced the penalty
imposed upon her. According to the Court, considering that
the two elements of lack of license or authority and the
undertaking of the activity constituting recruitment and
placement are present, appellant, at the very least, was liable
for simple illegal recruitment. A conviction for large-scale
illegal recruitment must be based on a finding in each case of
illegal recruitment of three or more persons whether
individually or as a group. In this case, only two persons were
proven to have been recruited by the appellant. Hence, the
decision of the Regional Trial Court was modified. Appellant
was found guilty of illegal recruitment on two counts and was
sentenced to 4 years to 6 years imprisonment on each count.

w/n there was illegal recruitment

In this case, the first element is present. The certification of
POEA Officer-in-Charge Macarulay states that appellant is not
licensed or authorized to engage in recruitment and
placement. The second element is also present. Appellant is
presumed engaged in recruitment and placement under
Article 13 (b) of the Labor Code. Both Nancy Araneta and
Lourdes Modesto testified that appellant promised them
employment for a fee. Their testimonies corroborate each
other on material points: the briefing conducted by appellant,
the time and place thereof, the fees involved. Appellant has
not shown that these witnesses were incited by any motive to
testify falsely against her. The absence of evidence as to an
improper motive actuating the principal witnesses of the
prosecution strongly tends to sustain that no improper
motive existed and that their testimony is worthy of full faith
and credence.


AKD Digests 7

Appellant's denials cannot prevail over the positive
declaration of the prosecution witnesses. Affirmative
testimony of persons who are eyewitnesses of the fact
asserted easily overrides negative testimony. That appellant
did not receive any payment for the promised or offered
employment is of no moment. From the language of the
statute, the act of recruitment may be "for profit or not"; it
suffices that the accused "promises or offers for a fee
employment" to warrant conviction for illegal recruitment. . .
The claim of "frameup," like alibi, is a defense that has been
invariably viewed by the Court with disfavor for it can easily
be concocted but difficult to prove. Apart from her self-
serving testimony, appellant has not offered any evidence
that she was indeed framed by Ramos. She has not even
hinted at any motive for Ramos to frame her. Law enforcers
are presumed to have performed their duties regularly in the
absence of evidence to the contrary.

[G.R. No. 172642. June 13, 2012.]
ESTATE OF NELSON R. DULAY, represented by his wife

Who has jurisdiction over a case involving the interpretation
or implementation of the collective bargaining agreement:
the labor arbiter or the voluntary arbitrator?

The recent case of Estate of Nelson R. Dulay represented by
his wife Merridy Jane P. Dulay vs. Aboitiz Jebsen Maritime,
Inc. & General Charterers, Inc. (G.R. No. 172642) decided by
the Supreme Court on June 13, 2012 answered the above
question by holding that the voluntary arbitrator should take
cognizance of such an issue.

In the said Dulay case, a veteran seafarer, after completion of
his employment contract, and while still a bona fide member
of a union which was the collective bargaining agent of his
employer, died of acute renal failure secondary to septicemia.
The widow claimed for death benefits through the grievance
procedure of the Collective Bargaining Agreement (CBA)
between the seafarers union and his employer but the
procedure was declared deadlocked. Pursuant to a provision
in the CBA, the widow then filed a claim against the employer
for death and medical benefits and damages amounting to US
90,000 dollars before the National Labor Relations
Commission (NLRC) Arbitration Board.

A few days later, the deceased seafarers brother received
20,000 Pesos from the employer pursuant to a different and
separate provision of the same CBA and released the union
from further liability. The employer insisted that the NLRC
has no jurisdiction over the widos claim due to the absence
of an employer-employee relationship at the time of the
seafarers death and the fact that the seafarers contract was
already completed prior to his demise. The labor arbiter and
the NLRC both recognized the claim and ruled in favor of the
widow, ordering the claims arising out of an employer-
employee relationship or by virtue of any employer to pay.

SBCA 2nd Sem SY 15-16

On appeal, the Court of Appeals (CA) reversed the decision of
the NLRC and referred the claim to the National Conciliation
and Mediation Board (NCMB) for the designation of the
voluntary arbitrator or constitution of a panel of voluntary
arbitrators for appropriate resolution on the applicable CBA
provision to be applied insofar as death benefits due to the
heirs of the seafarer are concerned.

The Supreme Court affirmed the CA ruling, finding that
Republic Act (RA) No. 8042, the special law governing
overseas Filipino workers, does not provide for any provision
regarding jurisdiction over disputes or unresolved
grievances on the interpretation or implementation of a CBA.
Section 10 of R.A. 8042 simply speaks in general of law or
contract involving Filipino workers for overseas deployment
including claims for actual, moral, exemplary and other forms
of damages. On the other hand, Articles 217 (c) and 261 of
the Labor Code, a general statute, are clear and particular in
expressing that voluntary arbitrators have jurisdiction over
case arising from the interpretation or implementation of
CBAs.. As such, the specific or special provisions of the Labor
Code govern and not those of R.A. 8042.

The High Court, upon review of the CBA which the seafarers
widow considers to be the law between the parties, likewise
concluded that the parties really intended to bring to
conciliation or voluntary arbitration any dispute or conflict in
the interpretation or application of the provisions of their

It noted that Section 7 of the Omnibus Rules and Regulations,
as amended by R.S. 10022, promulgated by the Department
of Labor and Employment and the Department of Foreign
Affairs, which implement R.A. 8042, so provides that for
Overseas Filipino Workers with CBAs the case shall be
submitted for voluntary arbitration following Articles 261
and 262 of the Labor Code. Such is the same idea invoked in
Section 29 of the POEA Standard Employment contract.

The Court made it clear that with respect to disputes
involving claims of Filipino seafarers where the parties are
covered by a CBA, the dispute or claim should be submitted
to the jurisdiction of a voluntary arbitrator or panel of
arbitrators. In the absence of a CBA, the parties may opt to
submit the dispute to either to the NLRC or to voluntary

This position is consistent with the policy of the state and
Section 3, Article 13 of the Constitution to promote voluntary
arbitration as a mode of settling labor disputes.

MANAGEMENT, INC., respondent.
G.R. No. 162419
July 10, 2007




AKD Digests 8

Petitioner had been working as a seafarer for Smith Bell

Management, Inc. (respondent) for about five (5) years. He
signed a new contract of employment with the duration of 9
months on Feb 3 1998 and he was to be deployed 10 days
after. This contract was approved by POEA. A week before
the date of departure, the respondent received a phone call
from petitioners wife and some unknown callers asking not
to send the latter off because if allowed, he will jump ship in

Because of the said information, petitioner was told that he
would not be leaving for Canada anymore. This prompted
him to file a complaint for illegal dismissal against the
respondent. The LA held the latter responsible. On appeal,
the NLRC ruled that there is no employer-employee
relationship between petitioner and respondent, hence, the
claims should be dismissed. The CA agreed with the NLRCs
finding that since petitioner had not departed from the Port
of Manila, no employer-employee relationship between the
parties arose and any claim for damages against the so-called
employer could have no leg to stand on.

ISSUE: When does the employer-employee relationship
involving seafarers commence?


A distinction must be made between the perfection of the
employment contract and the commencement of the
employer-employee relationship. The perfection of the
contract, which in this case coincided with the date of
execution thereof, occurred when petitioner and respondent
agreed on the object and the cause, as well as the rest of the
terms and conditions therein. The commencement of the
employer-employee relationship, as earlier discussed, would
have taken place had petitioner been actually deployed from
the point of hire. Thus, even before the start of any employer-
employee relationship, contemporaneous with the perfection
of the employment contract was the birth of certain rights
and obligations, the breach of which may give rise to a cause
of action against the erring party. Thus, if the reverse had
happened, that is the seafarer failed or refused to be
deployed as agreed upon, he would be liable for damages.

Respondents act of preventing petitioner from departing the
port of Manila and boarding "MSV Seaspread" constitutes a
breach of contract, giving rise to petitioners cause of action.
Respondent unilaterally and unreasonably reneged on its
obligation to deploy petitioner and must therefore answer
for the actual damages he suffered.

685 SCRA 245 Labor Law Labor Standards
Constitutionality of Sections 6, 7, 9, 10, 29, and 30 of the
Migrant Workers Act or R.A. No. 8042

This case is a consolidation of the following cases: G.R. No.
152642, G.R. No. 152710, G.R. No. 167590, G.R. Nos. 182978-
79, and G.R. Nos. 184298-99.

G.R. No. 152642 and G.R. No. 152710

SBCA 2nd Sem SY 15-16

In G.R. No. 152642, in 2002, Rey Salac et al, who are
recruiters deploying workers abroad, sought to enjoin the
Secretary of Labor, Patricia Sto. Tomas, the POEA, and
TESDA, from regulating the activities of private recruiters.
Salac et al invoked Sections 29 and 30 of the Republic Act
8042 or the Migrant Workers Act which provides that
recruitment agency in the Philippines shall be deregulated
one year from the passage of the said law; that 5 years
thereafter, recruitment should be fully deregulated. RA 8042
was passed in 1995, hence, Salac et al insisted that as early as
2000, the aforementioned government agencies should have
stopped issuing memorandums and circulars regulating the
recruitment of workers abroad.

Sto. Tomas then questioned the validity of Sections 29 and

ISSUE: Whether or not Sections 29 and 30 are valid.

HELD: The issue became moot and academic. It appears that
during the pendency of this case in 2007, RA 9422 (An Act to
Strengthen the Regulatory Functions of the POEA) was
passed which repealed Sections 29 and 30 of RA 8042.

G.R. 167590

In this case, the Philippine Association of Service Exporters,
Inc. (PASEI) questioned the validity of the following
provisions of RA 8042:

a. Section 6, which defines the term illegal recruitment.
PASEI claims that the definition by the law is vague as it fails
to distinguish between licensed and non-licensed recruiters;

b. Section 7, which penalizes violations against RA 8042.
PASEI argues that the penalties for simple violations against
RA 8042, i.e., mere failure to render report or obstructing
inspection are already punishable for at least 6 years and 1
day imprisonment an a fine of at least P200k. PASEI argues
that such is unreasonable;

c. Section 9, which allows the victims of illegal recruitment to
have the option to either file the criminal case where he or
she resides or at the place where the crime was committed.
PASEI argues that this provision is void for being contrary to
the Rules of Court which provides that criminal cases must be
prosecuted in the place where the crime or any of its
essential elements were committed;

d. Section 10, which provides that corporate officers and
directors of a company found to be in violation of RA 8042
shall be themselves be jointly and solidarily liable with the
corporation or partnership for the aforesaid claims and
damages. PASEI claims that this automatic liability imposed
upon corporate officers and directors is void for being
violative of due process.

RTC Judge Jose Paneda of Quezon City agreed with PASEI and
he declared the said provisions of RA 8042 as void. Secretary


AKD Digests 9

Sto. Tomas petitioned for the annulment of the RTC


ISSUE: Whether or not Sections 6, 7, 9, and 10 of RA 8042 are

HELD: No, they are valid provisions.

a. Section 6: The law clearly and unambiguously
distinguished between licensed and non-licensed recruiters.
By its terms, persons who engage in canvassing, enlisting,
contracting, transporting, utilizing, hiring, or procuring
workers without the appropriate government license or
authority are guilty of illegal recruitment whether or not they
commit the wrongful acts enumerated in that section. On the
other hand, recruiters who engage in the canvassing,
enlisting, etc. of OFWs, although with the appropriate
government license or authority, are guilty of illegal
recruitment only if they commit any of the wrongful acts
enumerated in Section 6.

b. Section 7: The penalties are valid. Congress is well within
its right to prescribed the said penalties. Besides, it is not the
duty of the courts to inquire into the wisdom behind the law.

c. Section 9: The Rules on Criminal Procedure, particularly
Section 15(a) of Rule 110, itself, provides that the rule on
venue when it comes to criminal cases is subject to existing
laws. Therefore, there is nothing arbitrary when Congress
provided an alternative venue for violations of a special penal
law like RA 8042.

d. Section 10: The liability of corporate officers and directors
is not automatic. To make them jointly and solidarily liable
with their company, there must be a finding that they were
remiss in directing the affairs of that company, such as
sponsoring or tolerating the conduct of illegal activities.

G.R. 182978-79, and G.R. 184298-99

In this case, Jasmin Cuaresma, a nurse working in Saudi
Arabia was found dead. Her parents received insurance
benefits from the OWWA (Overseas Workers Welfare
Administration). But when they found out based on an
autopsy conducted in the Philippines that Jasmin was raped
and thereafter killed, her parents (Simplicio and Mila
Cuaresma) filed for death and insurance benefits with
damages from the recruitment and placement agency which
handled Jasmin (Becmen Service Exporter and Promotion,

The case reached the Supreme Court where the Supreme
Court ruled that since Becmen was negligent in investigating
the true cause of death of Jasmin ( a violation of RA 8042), it
shall be liable for damages. The Supreme Court also ruled
that pursuant to Section 10 of RA 8042, the directors and
officers of Becmen are themselves jointly and solidarily liable
with Becmen.

SBCA 2nd Sem SY 15-16

Eufrocina Gumabay and the other officers of Becmen filed a

motion for leave to intervene. They aver that Section 10 is

ISSUE: Whether or not Section is invalid.

HELD: No. As earlier discussed, Section 10 is valid. The
liability of Gumabay et al is not automatic. However, the SC
reconsidered its earlier ruling that Gumabay et al are
solidarily and jointly liable with Becmen there being no
evidence on record which shows that they were personally
involved in their companys particular actions or omissions
in Jasmins case.

[G.R. No. 170139. August 5, 2014.]
INC., petitioner, vs. JOY C. CABILES, respondent.

Petitioner, Sameer Overseas Placement Agency, Inc., is a
recruitment and placement agency.

Respondent Joy Cabiles was hired thus signed a one-
year employment contract for a monthly salary of
NT$15,360.00. Joy was deployed to work for Taiwan Wacoal,
Co. Ltd. (Wacoal) on June 26, 1997. She alleged that in her
employment contract, she agreed to work as quality control
for one year. In Taiwan, she was asked to work as a cutter.

Sameer claims that on July 14, 1997, a certain Mr.
Huwang from Wacoal informed Joy, without prior notice, that
she was terminated and that she should immediately report
to their office to get her salary and passport. She was asked
to prepare for immediate repatriation. Joy claims that she
was told that from June 26 to July 14, 1997, she only earned a
total of NT$9,000.15 According to her, Wacoal deducted
NT$3,000 to cover her plane ticket to Manila.

On October 15, 1997, Joy filed a complaint for illegal
dismissal with the NLRC against petitioner and Wacoal. LA
dismissed the complaint. NLRC reversed LAs decision. CA
affirmed the ruling of the National Labor Relations
Commission finding respondent illegally dismissed and
awarding her three months worth of salary, the
reimbursement of the cost of her repatriation, and attorneys

ISSUE: Whether or not Cabiles was entitled to the unexpired
portion of her salary due to illegal dismissal.

YES. The Court held that the award of the three-month
equivalent of respondents salary should be increased to the
amount equivalent to the unexpired term of the employment

In Serrano v. Gallant Maritime Services, Inc. and
Marlow Navigation Co., Inc., this court ruled that the clause
or for three (3) months for every year of the unexpired term,


AKD Digests 10

whichever is less is unconstitutional for violating the equal

protection clause and substantive due process.

A statute or provision which was declared
unconstitutional is not a law. It confers no rights; it imposes
no duties; it affords no protection; it creates no office; it is
inoperative as if it has not been passed at all.

The Court said that they are aware that the clause or
for three (3) months for every year of the unexpired term,
whichever is less was reinstated in Republic Act No. 8042
upon promulgation of Republic Act No. 10022 in 2010.

Ruling on the constitutional issue

In the hierarchy of laws, the Constitution is supreme.
No branch or office of the government may exercise its
powers in any manner inconsistent with the Constitution,
regardless of the existence of any law that supports such
exercise. The Constitution cannot be trumped by any other
law. All laws must be read in light of the Constitution. Any
law that is inconsistent with it is a nullity.

Thus, when a law or a provision of law is null
because it is inconsistent with the Constitution, the nullity
cannot be cured by reincorporation or reenactment of the
same or a similar law or provision. A law or provision of law
that was already declared unconstitutional remains as such
unless circumstances have so changed as to warrant a
reverse conclusion.

The Court observed that the reinstated clause, this
time as provided in Republic Act. No. 10022, violates the
constitutional rights to equal protection and due process.96
Petitioner as well as the Solicitor General have failed to show
any compelling change in the circumstances that would
warrant us to revisit the precedent.

The Court declared, once again, the clause, or for
three (3) months for every year of the unexpired term,
whichever is less in Section 7 of Republic Act No. 10022
amending Section 10 of Republic Act No. 8042 is declared
unconstitutional and, therefore, null and void.

SBCA 2nd Sem SY 15-16


AKD Digests 11