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Usita and Friends Digest

Aguirre. Cabel. Fajardo. Marqueda. Medina. Sale. Santos

Lab Stan || 2F 2015-2016

1. Datuman v. Cosmopolitan Manpower

-They were required to file their respective position papers,

subsequent pleadings and documentary exhibits

-Respondent First Cosmopolitan Manpower & Promotion Services,
Inc. recruited petitioner Santosa B. Datuman to work abroad under
the following terms and conditions:
-Contract of Employment signed in the Philippines and approved by
the Philippine Overseas Employment Administration (POEA).
Site of employment - Bahrain
Employees Classification/Position/Grade - Saleslady
Duration of Contract - One (1) year

-they mutually agreed to submit the contract to the POEA

indicating petitioners position as saleslady.

-filed beyond the three (3)-year period from the time the right
accrued, reckoned from either 1990 or 1991.

Foreign Employer - Mohammed Sharif Abbas Ghulam Hussain

-April 17, 1989: petitioner was deployed to Bahrain after paying the
required placement fee.
-However, her employer Mohammed Hussain took her passport
when she arrived there; and was forced to work as a domestic
helper for 40 Bahrain Dinar
-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.
-She even worked without compensation from September 1991 to
April 1993 because of her employers continued failure and refusal
to pay her salary despite demand.
-May 1993, she was able to finally return to the Philippines through
the help of the Bahrain Passport and Immigration Department.

-it was the only position available then. However, since such
position was not yet allowed by the POEA at that time

-it was actually petitioner herself who violated the terms of

their contract when she allegedly transferred to another employer
without respondents knowledge and approval.

Basic Monthly Salary - US$370.00

-May 1995: petitioner filed a complaint

Adjudication Office against respondent




-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
-Parties failed to arrive at an amicable settlement before the Labor

-Labor Arbiter Jovencio Mayor, Jr.: respondent liable for violating the
terms of the Employment Contract and ordering it to pay petitioner

-The relationship of the complainant and respondent agency is
governed by the Contract of Employment
-Respondent Agency committed a breach of said Employment
-it had entered into an illegal contract with complainant by
proposing the position of a housemaid which said position
was then not allowed by the POEA, by making it appear in
the Employment Contract that the position being applied
for is the position of a saleslady.
-failure to support with substantial evidence their contention that
complainant transferred from one employer to another without
knowledge and approval of respondent agency in contravention of
the terms of the POEA approved Employment Contract.

Usita and Friends Digest

Aguirre. Cabel. Fajardo. Marqueda. Medina. Sale. Santos
Lab Stan || 2F 2015-2016

-complainant was forced against her will to continue with

her employment notwithstanding the fact that it was in
violation of the original Employment Contract including the
illegal withholding of her passport.




-On appeal, the NLRC, Second Division, issued a Decision affirming

with modification the Decision of Labor Arbiter Mayor, Jr., by
reducing the award of salary differentials

We grant the petition.

-claims for salary differentials accruing earlier than April of 1993

had indeed prescribed. -This is so as complainant had filed her
complaint on May 31, 1995 when she arrived from the jobsite in
April 1993. Since the cause of action for salary differential
accrues at the time when it falls due
-dismissed the petition for being insufficient in form
-claims of private respondent for salary differentials accruing
earlier than April of 1993 had indeed prescribed
-petitioner company is privy only to the first contract
-its liability extends to the acts of its foreign principal, the Towering
Recruiting Services, which appears to have a hand in the execution
of the second contract
-Respondent Commission as not only having abused its discretion,
but as being without jurisdiction at all, in declaring private
respondent entitled to salary differentials.
-After decreeing the money claims accruing before April
1993 as having prescribed, it has no more jurisdiction to
hold petitioner company for salary differentials after that
-The local agency shall assume joint and solidary liability with the
employer for all claims and liabilities which may arise in connection
with the implementation of the contract.

WON the CA erred in not holding respondent liable for petitioners

money claims pursuant to their Contract of Employment.

On whether respondent is solidarily liable for petitioners

monetary claims
Section 1 of Rule II of the POEA Rules and Regulations states that:
Section 1. Requirements for Issuance of License. Every applicant for
license to operate a private employment agency or manning
agency shall submit a written application together with the
following requirements:
f. A verified undertaking stating that the applicant:
(3) Shall assume joint and solidary liability with the employer
for all claims and liabilities which may arise in connection
with the implementation of the contract; including but not
limited to payment of wages, death and disability compensation
and repatriation. (emphasis supplied)
-The private employment agency shall assume joint and
solidary liability with the employer.
-meant to assure the aggrieved worker of immediate and sufficient
payment of what is due him.
-in line with the policy of the state to protect and alleviate the
plight of the working class.
-We cannot agree with the view of the CA that the solidary liability
of respondent extends only to the first contract
-The signing of the substitute contracts with the foreign
employer/principal before the expiration of the POEA-approved
contract and any continuation of petitioners employment beyond
the original one-year term, against the will of petitioner, are
continuing breaches of the original POEA-approved contract.

Usita and Friends Digest

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Lab Stan || 2F 2015-2016

-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.
-The said side agreement cannot supersede the terms of
the standard employment contract approved by the POEA.
-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
On whether petitioners claims for underpaid salaries have
-The three-year prescriptive period should be reckoned from
September 1, 1989 when petitioner was forced to sign another
contract against her will.
-As stated in the complaint, one of petitioners causes of action was
for underpayment of salaries. The NLRC correctly ruled the right to
claim unpaid salaries (or in this case, unpaid salary differentials)
accrue as they fall due
-Thus, petitioners cause of action to claim salary differential
for October 1989 only accrued after she had rendered
service for that month (or at the end of October 1989). -Her
right to claim salary differential for November 1989 only accrued at
the end of November 1989, and so on and so forth.
2. People v. Gallo
-Accused-appellant Gallo and accused Fides Pacardo (Pacardo) and

Pilar Manta (Manta), together with Mardeolyn Martir (Mardeolyn)

and nine (9) others, were charged with syndicated illegal
recruitment and eighteen (18) counts of estafa committed
against eighteen complainants, including
-Only Criminal Case which was filed against accused-appellant
Gallo, Pacardo and Manta for syndicated illegal recruitment which
were filed against accused-appellant Gallo, Pacardo and Manta for
estafa, proceeded to trial due to the fact that the rest of the
accused remained at large and for failure of the respective
complainants in said cases to appear and testify during trial.
-False representations and promises in assuring Dela Caza and the
other victims that after they paid the placement fee, jobs in Korea
as factory workers were waiting for them and that they would be
deployed soon -- MPM International Recruitment and Promotion
Agency (MPM Agency) located in Malate, Manila
-In fact, Dela Caza personally talked to accused-appellant and gave
him the money and saw him sign and issue an official receipt as
proof of his payment.
-convicting the accused of syndicated illegal recruitment and
-Affirmed with modification
-Evidence showed that the accused-appellant, together with others,
engaged in the recruitment of Dela Caza. His actions and
representations to Dela Caza can hardly be construed as
the actions of a mere errand boy.
- a personal found guilty of illegal recruitment may also be
convicted of estafa.
WON Gallo and other are guilty of syndicated illegal recruitment
and estafa.
-In the instant case, accused-appellant committed the acts
enumerated in Sec. 6 RA 8042.
-Testimonial evidence presented by the prosecution clearly shows
that, in consideration of a promise of foreign employment, accusedappellant made misrepresentations concerning the agency's
purported power and authority to recruit for overseas employment,
and in the process, collected money in the guise of placement fees,

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Lab Stan || 2F 2015-2016

the former clearly committed acts constitutive of illegal

-In this case, it cannot be denied that the accused-appellant
together with Mardeolyn and the rest of the officers and employees
of MPM agency participated in a network of deception.
-Verily, the active involvement of each in the recruitment scam was
directed at one single purpose - to divest complainants with their
money on the pretext of guaranteed employment abroad.
-The prosecution evidence shows that complainants were briefed by
Mardeolyn about the processing of their papers for a possible job
opportunity in Korea, as well as their possible salary.
-Likewise, Yeo Sin Ung, a korean national, gave a briefing about the
business and what to expect from the company
-then, here comes accused-appellant who introduced himself as
Mardeolyn's relative and specifically told Dela Caza of the fact that
the agency was able to send many workers abroad.
-Dela Caza was even showed several workers visas who were
already allegedly deployed abroad.
-Later on, accused-appellant signed and issued an official receipt
acknowledging the down payment of Dela Caza.
-Without a doubt, the nature and extent of the actions of accusedappellant, as well as with the other persons in MPM Agency clearly
show unity of action towards a common undertaking.
-Hence, conspiracy is evidently present.
The appeal has no merit.





Principalia failed to deploy Concha for employment abroad.


Baldoza: Principalia assured him of employment in Doha,

Qatar as a machine operator with a monthly salary of
$450.00. After paying P20,000.00 as placement fee, he
departed for Doha, Qatar on May 31, 2003 but when he
arrived at the jobsite, he was made to work as welder, a job
which he had no skills.

Entered into compromise agreement with Principalia

with quitclaim and Principalia agreed to redeploy
Baldoza for employment abroad. However, Principalia
failed to deploy Baldoza.

Principalia's license was suspended, but was lifted later

Before promulgation of POEA's order lifting the suspension,

Principalia filed a complaint against administrator of POEA

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, thus it filed for preliminary

application has become moot because POEA had already

released the renewal of license of principalia.


2 separate complaints (Concha and Baldoza) file dbefore

POEA against Principalia Management and Personnel
Consultants, Incorporated for violation of 2002 POEA
rules and Regulations
Concha: 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,

POEA found Principalia liable for violations of 2002 POEA

RR-- collecting a fee from the applicant before
employment was obtained; for non-issuance of official
receipt; and for misrepresenting that it was able to
secure employment for Concha.

RE: application for Writ of Preliminary Prohibitory injunction

for the suspension order Principalia presented evidence to
prove the ff: it has license; license was renewed.

Court finds the need to issue the Writ of preliminary

Prohibitory Injunction.

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Lab Stan || 2F 2015-2016

The trial court stressed that it issued the injunctive writ because:
1. the order of suspension dated March 15, 2004 is still
pending appeal before the Office of the Secretary of Labor

were sufficient to render an independent assessment of its

improvident issuance.

and Employment;

POEA failed to comply sec 3 rule 46 and sec 1 rule 65 of


2. that there is a possibility that Principalia will suffer

tremendous losses and even closure of business pending



that POEA will not suffer any damage if the immediate








of non-forum shopping as provided in the third paragraph of

Section 3, Rule 46.

suspension of the license is immediately executory.

POEA appealed to CA- denied


relevant and pertinent thereto, and a sworn certification

4. that the order does not categorically state that the

POEA motion

petition shall be accompanied by a certified true

copy of the judgment, order or resolution subject

implementation of the suspension of Principalia is enjoined;

The court disagrees. CA dismissed the petition because

In the case at bar, the Court of Appeals dismissed the

petition for certiorari due to POEAs failure to attach the




following relevant documents:

oppose the Complaint; and

(1) whether the Court of Appeals erred in dismissing the Petition for
Certiorari based on purely technical grounds; and

(1) the Memorandum filed by POEA in the trial court to

(2) the transcripts of stenographic notes (TSN) of the

hearings conducted by the trial court on June 22, 2004 and

(2) whether the trial court erred in issuing the writ of preliminary

June 29, 2004.


POEA still failed to attach a copy of the

Memorandum which the Court of Appeals deemed essential


in its determination of the propriety of the trial courts


issuance of the writ of preliminary prohibitory injunction

POEA avers that CA's dismissal of petition for certiorari is not valid

we cannot fault the Court of Appeals for dismissing the

because the documents attached to the petition substantially

petition because the POEA did not demonstrate willingness

informed the CA that the trial court gravely abused its discretion in

to comply with the requirements set by the rules and to

granting the preliminary injunction. Thus, the attached documents

submit the necessary documents which the Court of Appeals

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Lab Stan || 2F 2015-2016

need to have a proper perspective of the case.

its regulatory functions over Principalia because the

matter had already been brought to the jurisdiction


of the DOLE.

POEA avers that the trial court gravely abused its








adjudication by the DOLE would be premature and would

prohibitory injunction when the requirements to

amount to a violation of the latters right to recruit and

issue the same have not been met.

It asserts that Principalia had no clear and convincing right

to the relief demanded as it had no proof of irreparable

POEAs action of suspending Principalias license before final

deploy workers.

damage as required under the Rules of Court.

We do not agree.
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.

irreparable damage was duly proven by Principalia.

If the injunctive writ was not granted, Principalia would
have been labeled as an untrustworthy recruitment
agency before there could be any final adjudication
of its case by the DOLE.

It would have lost both its employer-clients and its

prospective Filipino-applicants. Loss of the former due to a
tarnished reputation is not quantifiable.

Moreover, POEA would have no authority to exercise





Sulpecio Madequillo (respondent) filed a complaint before
the Adjudication Office (POEA) against the petitioners for
illegal dismissal under a first contract and for failure
to deploy under a second contract.
Medequilla was hired as Third Assistant Engineer on
board vessel Stolt Aspiration for period of 9 months
for just 3 months of rendering service he was ordered to
disembark the vessel for no reason
he immediately proceeded to Pet. Office where he was
transferred employment with another vessel under same
condition and terms of first contract.
A second contract was noted and approved by POEA,
without knowledge that he was not deployed with the
vessel on the first contract.
Despite commencement of second contract-- pet failed
to deploy him
he demanded for his documents but he was only allowed
to claim the documents in exchange of his signing a
He signed the document involuntarily.

He prayed for damages for his illegal dismissal and in view

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Lab Stan || 2F 2015-2016

of Pet's bad faith in not complying with the second contract.

The case was transferred to the Labor Arbiter of the DOLE
upon the effectivity of the Migrant Workers and Overseas
Filipinos Act of 1995.
The parties were required to submit their respective position
papers before the Labor Arbiter.
However, petitioners failed to submit their respective
pleadings despite the opportunity given to them
Labor Arbiter Layawen rendered a judgment finding that
the respondent was constructively dismissed by the
petitioners in not honoring the employment contract..
Labor Arbiter found the first contract entered into by
and between the complainant and the respondents to
have been novated by the execution of the second
In other words, respondents cannot be held liable for the
first contract but are clearly and definitely liable for the
breach of the second contract.
PET: they were denied due process and that respondent
cannot be considered as dismissed from employment
because he was not even deployed yet.
Pet: they were not properly notified of the hearings that
were conducted before the labor arbiter

Whether or not the first employment contract between petitioners
and the private respondent is different from and independent of
the second contract subsequently executed upon repatriation of
respondent to Manila which justifies termination of respondent?

Novation is the extinguishment of an obligation by the substitution

or change of the obligation by a subsequent one which
extinguishes or modifies the first, either by changing the object or
principal conditions, or, by substituting another in place of the
debtor, or by subrogating a third person in the rights of the
creditor. In order for novation to take place, the concurrence of the
following requisites is indispensable:
2. There must be an agreement of the parties concerned to a new
3. There must be the extinguishment of the old contract, and
4. There must be the validity of the new contract.

Pet: contention is that first employment contract between

them and the private respondent is different from and
independent of the second contract subsequently executed
upon repatriation of respondent to Manila.-NO, court does
not agree.



Labor Arbiter clarified that novation had set in between the

first and second contract.
The first contract entered into by and between the
complainant and the respondents is deemed to have been
novated by the execution of the second contract. In other
words, respondents cannot be held liable for the first
contract but are clearly and definitely liable for the breach
of the second contract.
The records also reveal that the 2nd contract extinguished
the first contract by changing its object or principal. These
contracts were for overseas employment aboard different
The first contract was for employment aboard the MV Stolt
Aspiration while the second contract involved working in
another vessel, the MV Stolt Pride.
respondent was still employed under the first contract
when he negotiated with petitioners on the second
contract, novation became an unavoidable conclusion.
issue that proceeds from the fact of novation is the
consequence of the non-deployment of respondent.

Equally settled is the rule that factual findings of labor officials, who
are deemed to have acquired expertise in matters within their
jurisdiction, are generally accorded not only respect but even
finality by the courts when supported by substantial evidence,i.e.,

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Lab Stan || 2F 2015-2016

the amount of relevant evidence which a reasonable mind might

accept as adequate to justify a conclusion.But these findings are
not infallible. When there is a showing that they were arrived at
arbitrarily or in disregard of the evidence on record, they may be
examined by the courts.In this case, there was no showing of any
arbitrariness on the part of the lower courts in their findings of
The POEA Standard Employment Contract provides that
employment shall commence upon the actual departure of the
seafarer from the airport or seaport in the port of hire.We adhere to
the terms and conditions of the contract so as to credit the valid
prior stipulations of the parties before the controversy started. Else,
the obligatory force of every contract will be useless. Parties are
bound not only to the fulfillment of what has been expressly
stipulated but also to all the consequences which, according to
their nature, may be in keeping with good faith, usage and law.
We rule that distinction must be made between the perfection of
the employment contract and the commencement of the employeremployee 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.
Petition: Denied.
5. Yap v. Thinamaris Ships Management

Claudio S. Yap was employed as electrician of the vessel,

M/T SEASCOUT on 14 August 2001 by Intermare Maritime
Agencies, Inc. The contract of employment entered into by Yap and
Capt. Francisco B. Adviento, the General Manager of Intermare, was
12 months. However, on or about 08 November 2001, the vessel
was sold. The Philippine Overseas Employment Administration
(POEA) was informed about the sale on 06 December 2001. Yap,
along with the other crewmembers, was informed by the Master of
their vessel that the same was sold and will be scrapped.
Yap received his seniority bonus, vacation bonus, extra bonus along
with the scrapping bonus. However, with respect to the payment of
his wage, he refused to accept the payment of one-month basic
wage. 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.
Respondentscontended that Yap was not illegally dismissed. They
alleged that following the sale of the M/T SEASCOUT, Yap signed off
from the vessel and was paid his wages corresponding to the
months he worked plus his bonuses. They further alleged that Yaps
employment contract was validly terminated due to the sale of the
vessel and no arrangement was made for Yaps transfer to
Thenamaris other vessels
Petitioner filed a complaint for Illegal Dismissal with Damages
and Attorneys Fees before the Labor Arbiter (LA). Petitioner
claimed that he was entitled to the salaries corresponding to the
unexpired portion of his contract.
LA rendered a decision in favor of petitioner, finding the latter
to have been constructively and illegally dismissed by
respondents. Moreover, the LA found that respondents acted in bad
faith when they assured petitioner of re-embarkation, but actually
he was not able to board one despite of respondents numerous
vessels. Lastly, the LA opined that since the unexpired portion of
petitioners contract was less than one year, petitioner was entitled
to his salaries for the unexpired portion of his contract for a period
of nine months(US$12,870.00).
Respondents sought recourse from the NLRC who affirmed
LAs findings. However, the NLRC held that instead of an
award of salaries corresponding to nine months, petitioner
was only entitled to salaries for three months(US$4,290.00)

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Lab Stan || 2F 2015-2016

as provided under Section 10 of Republic Act (R.A.) No.

Both Petitioner and Respondents filed their own Motions for Partial
NLRC affirmed the findings of Illegal Dismissal and respondents
failure to transfer petitioner to another vessel. However, finding
merit in petitioners arguments, the NLRC reversed its earlier
Decision, holding that there can be no choice to grant only three
(3) months salary for every year of the unexpired term because
there is no full year of unexpired term which this can be
applied. (balik 12,870 yung salary nadapatibigay)
Respondents filed a petition for certiorari under Rule 65. CA
affirmed the findings and ruling of the LA and the NLRC. The CA
held that respondents failed to show that the NLRC acted without
statutory authority and that its findings were not supported by law,
jurisprudence, and evidence on record. However, the CA ruled that
the NLRC erred in sustaining the LAs interpretation of Section 10 of
R.A. No. 8042. In this regard, 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 motions for reconsideration,
which the CA, however, denied in its Resolution.

We have already declared in Serrano that 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 is unconstitutional for being violative of
the rights of Overseas Filipino Workers (OFWs) to equal
protection of the laws.
Moreover, this Court held therein that the subject clause
does not state or imply any definitive governmental
purpose; hence, the same violates not just therein petitioners
right to equal protection, but also his right to substantive due
process under Section 1, Article III of the Constitution.
An unconstitutional act 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 doctrine of
operative fact serves as an exception to the aforementioned
general rule. This case should not be included in the exception.
After all, it was not the fault of petitioner that he lost his job due to
an act of illegal dismissal committed by respondents. To rule
otherwise would be iniquitous to petitioner and other OFWs, and
would, in effect, send a wrong signal that principals/employers and
recruitment/manning agencies may violate an OFWs security of
tenure which an employment contract embodies and actually profit
from such violation based on an unconstitutional provision of law.

1) Whether or not Section 10 of R.A. [No.] 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 or for three (3) months for
every year of the unexpired term, whichever is less is
2)Assuming that it is, whether or not the Court of Appeals
gravely erred in granting petitioner only three (3) months
backwages when his unexpired term of 9 months is far
short of every year of the unexpired term threshold

6. People v. Panis
Four informations were filed in the Court of First Instance of
Zambales and Olongapo City alleging that SerapioAbug, private
respondent herein, "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 named therein, in
violation of Article 16 in relation to Article 39 of the Labor Code.

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Abug filed a motion to quash on the ground that the informations

did not charge an offense because he was accused of illegally
recruiting only one person in each of the four informations.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.
The other acts mentioned in the body of the article may involve
even only one person and are not necessarily for profit.
Denied at first, the motion was reconsidered and finally granted in
the Orders of the trial court dated June 24 and September 17,
1981. The prosecution is now before us on certiorari.

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
that presumption.

7. Lazo v. Salac
The case is composed of consolidated complaints that are assailing
the constitutionality of some of the provisions of the Migrant
Workers and Overseas Filipinos Act of 1995 (RA 8042). This act was
enacted by Congress on June 7, 1995 to set the Governments
policies on overseas employment and establishes a higher standard
of protection and promotion of the welfare of migrant workers, their
families, and overseas Filipinos in distress.
G.R. 152642 and G.R. 152710

Issues: Whether or not the trial court erred in dismissing the

Held: Yes
The proviso was intended neither to impose a condition on
the basic rule nor to provide an exception thereto but
merely to create a presumption. The presumption is that
the individual or entity is engaged in recruitment and
placement whenever he or it is dealing with two or more persons
to whom, in consideration of a fee, an offer or promise of
employment is made in the course of the "canvassing, enlisting,
contracting, transporting, utilizing, hiring or procuring (of)
The number of persons dealt with is not an essential ingredient of
the act of recruitment and placement of workers. Any of the acts
mentioned in the basic rule in Article 13(b) win constitute
recruitment and placement even if only one prospective worker is
involved. The proviso merely lays down a rule of evidence that
where a fee is collected in consideration of a promise or offer of

The sections being questioned commanded the Department of
Labor and Employment (DOLE) to begin deregulating within one
year of its passage the business of handling the recruitment and
migration of overseas Filipino workers and phase out within five
years the regulatory functions of the Philippine Overseas
Employment Administration (POEA).
On January 8, 2002 respondents Rey Salac and company filed
complaintagainst the DOLE Secretary, POEA Administrator, and
Technical Education and Skills Development Authority (TESDA)
Secretary-General before the RTC of Quezon City.Salac, et al.
sought to: 1) nullify DOLE Department Order 10 (DOLE DO 10) and
POEA Memorandum Circular 15 (POEA MC 15); 2) prohibit the
DOLE, POEA, and TESDA from implementing the same and from
further issuing rules and regulations that would regulate the
recruitment and placement of overseas Filipino workers (OFWs);
and 3) also enjoin them to comply with the policy of deregulation
mandated under Sections 29 and 30 of Republic Act 8042.

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The RTC granted Salacs petition and ordered the government

agencies mentioned to deregulate the recruitment and placement
of OFWs. As a response to the RTCs ruling, the government officials
concerned filed the present petition and sought to annul the RTCs
decision and have the same enjoined pending action on the
The Philippine Association of Service Exporters, Inc. intervened in
the case before the Court.It claimed that the RTCs decision
paralyzed the deployment abroad of OFWs and performing artists.
The Court then issued a TRO in the case preventing the RTCfrom
enforcing its decision.
In a parallel case, Asian Recruitment Council Philippine Chapter,
Inc. and others (Arcophil, et al.) filed a petition against the DOLE
Secretary, the POEA Administrator, and the TESDA DirectorGeneral, before the RTC of Quezon City to prevent the latter from
implementing the 2002 Rules and Regulations Governing the
Recruitment and Employment of Overseas Workers and to cease
and desist from issuing other orders, circulars, and policies that
tend to regulate the recruitment and placement of OFWs in
violation of the policy of deregulation provided in Sections 29 and
30 of R.A. 8042. The RTC granted the petition. This prompted the
DOLE Secretary, the POEA Administrator, and the TESDA DirectorGeneral to file the present action in G.R. 152710. The Court then
issued TRO against the decision rendered by the RTC.
On December 4, 2008, the Republic informed the Court that by
virtue of RA 9422, which was signed into law by former President
GMA, Sections 29 and 30 of RA 8042 have been repealed.

SEC. 1. Section 23, paragraph (b.1) of Republic Act No.
8042, otherwise known as the Migrant Workers and Overseas
Filipinos Act of 1995 is hereby amended to read as follows:
(b.1) Philippine Overseas Employment Administration The
Administration shall regulate private sector participation in the
recruitment and overseas placement of workers by setting up a
licensing and registration system. It shall also formulate and
Implement, in coordination with appropriate entities concerned,
when necessary, a
system for promoting and monitoring the
overseas employment of Filipino workers taking into consideration
their welfare and the domestic manpower requirements.
In addition to its powers and functions, the administration
shall inform migrant workers not only of their rights as workers but
also of their rights as human beings, instruct and guide the workers
how to assert their rights and provide the available mechanism to
redress violation of their rights.
In the recruitment and placement of workers to service the
requirements for trained and competent Filipino workers of foreign
governments and their instrumentalities, and such other employers
as public interests may require, the administration shall deploy
only to countries where the Philippines has concluded bilateral
labor agreements or arrangements: Provided, That such countries
shall guarantee to protect the rights of Filipino migrant workers;
and: Provided, further, That such countries shall observe and/or
comply with the international laws and standards for migrant

SEC. 2. Section 29 of the same law is hereby repealed.
Won Sections 29 and 30 of RA 8042 are constitutional.
SEC. 3. Section 30 of the same law is also hereby repealed.
No. The Supreme Court held that the Sections in question are no
longer valid and operative because they have already been
repealed by a subsequent Republic Act, RA 9422. RA 9422 states

The Court has no reason to disagree with the contention that the
enactment of RA 9422 has rendered the issues presented in both
cases to be moot and academic. Consequently, the Supreme Court
dismissed the two cases, G.R. 152642 and 152710.

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G.R. 167590
Philippine Association of Service Exporters, Inc. (PASEI) filed a
petition before the RTC of Manila, seeking to annul Sections 6
(definition of illegal recruitment), 7 (applicable penalties), and 9
(procedure and venue for filing complaint) of R.A. 8042 for being
unconstitutional. The RTC declared Section 6 unconstitutional on
the ground that its definition of illegal recruitment is vague as it
fails to distinguish between licensed and non-licensed recruiters.
This vagueness, according to the RTC, gives undue advantage to
the non-licensed recruiters in violation of the right to equal
protection of those that operate with government licenses or
authorities.The RTC also declared Section 7 unconstitutional on the
ground that its sweeping application of the penalties failed to make
any distinction as to the seriousness of the act committed for the
application of the penalty imposed on such violation. The Manila
RTC also invalidated Section 9 of R.A. 8042 on the ground that
allowing the offended parties to file the criminal case in their place
of residence would negate the general rule on venue of criminal
cases which is the place where the crime or any of its essential
elements were committed. It held that venue is jurisdictional in
penal laws and, allowing the filing of criminal actions at the place of
residence of the offended parties violates their right to due

1. WON the definition of illegal recruitment under Section 6
is ambiguous
2. WON Section 7 is unconstitutional
3. WON Section 9 of RA 8042 is constitutional

1. NO. The Supreme Court held that illegal recruitment as

defined in Section 6 is clear and unambiguous. Contrary to
the RTCs finding, Section 6 makes a distinction 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
2. No. The Supreme Court held that Section 7 of RA 8042 is
constitutional. The law can impose such grave penalties
upon what it believed were specific acts that were not as
condemnable as the others in the lists. In fixing uniform
penalties for each of the enumerated acts under Section 6,
Congress was within its prerogative to determine what
individual acts are equally reprehensible, consistent with the
State policy of according full protection to labor, and
deserving of the same penalties. It is not within the power of
the Court to question the wisdom of this kind of choice. In
fixing such tough penalties, the law considered the
unsettling fact that OFWs must work outside the countrys
borders and beyond its immediate protection. The law must,
therefore, make an effort to somehow protect them from
conscienceless individuals within its jurisdiction who, fueled
by greed, are willing to ship them out without clear
assurance that their contracted principals would treat such
OFWs fairly and humanely.
3. Yes. The Supreme Court ruled that Section 9 of R.A. 8042,
as an exception to the rule on venue of criminal actions is,
consistent with that laws declared policy of providing a
criminal justice system that protects and serves the best
interests of the victims of illegal recruitment.

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G.R. 167590, G.R. 182978-79, and G.R. 184298-99

Spouses Simplicio and Mila Cuaresma (the Cuaresmas) filed a claim
for death and insurance benefits and damages against petitioners
Becmen Service Exporter and Promotion, Inc. (Becmen) and White
Falcon Services, Inc. (White Falcon) for the death of their daughter
JasminCuaresma while working as staff nurse in Riyadh, Saudi
The Labor Arbiter (LA) dismissed the claim on the ground that the
Cuaresmas had already received insurance benefits arising from
their daughters death from the Overseas Workers Welfare
Administration (OWWA). The LA also gave due credence to the
findings of the Saudi Arabian authorities that Jasmin committed
The National Labor Relations Commission (NLRC), however, found
Becmen and White Falcon jointly and severally liable for Jasmins
death and ordered them to pay the Cuaresmasfor actual damages.
The NLRC relied on the Cabanatuan City Health Offices autopsy
finding that Jasmin died of criminal violence and rape.
Becmen and White Falcon appealed the NLRC Decision to the CA.
The CA held Becmen and White Falcon jointly and severally liable
with their Saudi Arabian employer for actual damages, with
Becmen having a right of reimbursement from White Falcon.
Becmen and White Falcon appealed the CA Decision to this
Court.The Court deleted the award of actual damages but ruled
that Becmens corporate directors and officers are solidarily liable
with their company for its failure to investigate the true nature of
Jasmins death. Becmen and White Falcon abandoned their legal,
moral, and social duty to assist the Cuaresmas in obtaining justice
for their daughter. Consequently, the Court held the foreign
employer Rajab and Silsilah, White Falcon, Becmen, and the latters
corporate directors and officers jointly and severally liable to the
Cuaresmas for moral damages, exemplary damages, attorneys
fees, and cost of suit.

The corporate directors and officers of Becmen, filed a motion for

leave to intervene. They questioned the constitutionality of the last
sentence of the second paragraph of Section 10, R.A. 8042 which
holds the corporate directors, officers and partners jointly and
solidarily liable with their company for money claims filed by OFWs
against their employers and the recruitment firms. The Court
allowed the intervention and admitted Gumabay, et al.s motion for
WON the 2nd







No. The Court SETS ASIDE the Decision of the Regional Trial Court
of Manila dated December 8, 2004 and DECLARES Sections 6, 7,
and 9 of Republic Act 8042 valid and constitutional.
In G.R. 182978-79 and G.R. 184298-99 as well as in G.R. 167590,
the Court HOLDS the last sentence of the second paragraph of
Section 10 of Republic Act 8042 valid and constitutional. The Court,
however, RECONSIDERS and SETS ASIDE the portion of its
Decision in G.R. 182978-79 and G.R. 184298-99 that held
intervenorsEufrocinaGumabay, Elvira Taguiam, Lourdes Bonifacio,
and Eddie De Guzman jointly and solidarily liable with respondent
Becmen Services Exporter and Promotion, Inc. to spouses Simplicia
and Mila Cuaresma for lack of a finding in those cases that such
intervenors had a part in the act or omission imputed to their

8. Serrano vs Gallant Maritime

Facts: Petitioner was hired by Gallant Maritime Services, Inc. and
Marlow Navigation Co., Ltd. (respondents) under a POEA-approved
Contract of Employment with the terms and conditions: for 12
months, as Chief Officer, with the basic monthly salary of

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US$1,400.00 for 48 hours per week, plus overtime pay of

US$700.00 per month, and vacation leave with pay for 7 days per
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 by respondent that he would be made Chief
Officer by the end of April 1998. Respondents did not deliver on
their promise to make petitioner Chief Officer. Hence, petitioner
refused to stay on as Second Officer and was repatriated to the
Philippines on May 26, 1998.
Petitioner's employment contract was for a period of 12 months but
at the time of his repatriation on May 26, 1998, he had served only
2 months and 7 days of his contract, leaving an unexpired portion
of 9 months and 23 days.
Petitioner filed with the Labor Arbiter a Complaint for constructive
dismissal and for payment of his money claims in the total amount
of US$26,442.73 plus moral, exemplary damages and attorney's
The LA declared that the dismissal of petitioner illegal and
awarding him monetary benefits of US$8,770.00, representing the
petitioners salary for 3 months of the unexpired portion. Plus
US$45 for the claim of a salary differential. They are required to
pay in Philippine Currency at the exchange rate prevailing the time
of payment.
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. Respondents appealed NLRC to question the finding of the
LA that petitioner was illegally dismissed.
Petitioner also appealed 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 that in case
of illegal dismissal, OFWs are entitled to their salaries for the
unexpired portion of their contracts.

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."
Petitioner filed a Motion for Partial Reconsideration, but this time he
questioned the constitutionality of the subject clause-- the last
clause in the 5th paragraph of Section 10, Republic Act (R.A.) No.
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.
Issue: 1. Does the subject clause violate Sec 10, Art 3 of the
Constitution on non-impairment of contracts?
2. Does the subject clause violate Sec 1, Art 3 of the
Constitution, and Sec 18, Art 2 and Sec 3, Art 13 on labor as a
protected sector?
Held: 1. The answer is in the negative. Petitioner's claim is not
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, and cannot affect acts
or contracts already perfected; however, as to laws already in
existence, their provisions are read into contracts and deemed a
part thereof. 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.

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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 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.
2. 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, Article II and Section 3, 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.
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.
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; 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; and c) strict judicial scrutiny in which a legislative
classification which impermissibly interferes with the exercise of a
fundamental right or operates to the peculiar disadvantage of a
suspect class 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.
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;
In sum, prior to R.A. No. 8042, OFWs and local workers with fixedterm 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.
Hence, the subject clause singles out one classification of OFWs
and burdens it with a peculiar disadvantage. 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 5 th paragraph of Section
10 of Republic Act No. 8042 is declared UNCONSTITUTIONAL.
Hence, petitioner is entitled to his salaries for the entire unexpired
period of nine months and 23 days of his employment contract,

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pursuant to law and jurisprudence prior to the enactment of R.A.

No. 8042.
9. PASEI v. Drillon [G.R. No. 81958 June 30, 1988]
Facts: Philippine Association of Service Exporter, Inc. is a firm
engaged principally in the recruitment of Filipino workers, male and
constitutionality of Department Order No. 1 of 1988 of the DOLE
claiming that the said order is discriminatory against males or
females and that it does not apply to all Filipino workers but only
to domestic helpers and females with similar skills," and that it is
violative of the right to travel. It also claims that to be an invalid
exercise of the lawmaking power, police power being legislative,
and not executive, in character.
In its supplement to the petition, PASEI invokes Section 3, of Article
XIII, of the Constitution, providing for worker participation "in policy
and decision-making processes affecting their rights and benefits
as may be provided by law." Department Order No. 1 was passed in
the absence of prior consultations. It is claimed, finally, to be in
violation of the Charter's non-impairment clause, in addition to the
"great and irreparable injury" that PASEI members face should the
Order be further enforced.
The Solicitor General, on behalf of the respondents Secretary of
Labor and Administrator of the Philippine Overseas Employment
Administration, filed a Comment informing the Court that the Labor
Secretary lifted the deployment ban in the states of Iraq, Jordan,
Qatar, Canada, Hongkong, United States, Italy, Norway, Austria,
and Switzerland, further invoking the exercise of police power of
the Philippine State.
Issue: Was the deployment ban for female domestic helpers
provided by Department Order 1 constitutional?
Held: Yes. It is admitted that Department Order No. 1 is in
the nature of a police power measure . As defined, it consists
of (1) an imposition of restraint upon liberty or property, (2) in
order to foster the common good. It is not capable of an exact
definition but has been, purposely, veiled in general terms to
underscore its all-comprehensive embrace.
"Its scope, ever-expanding to meet the exigencies of the times,

even to anticipate the future where it could be done, provides

enough room for an efficient and flexible response to conditions
and circumstances thus assuring the greatest benefits." The Bill of
Rights itself does not purport to be an absolute guaranty of
individual rights and liberties Even liberty itself, the greatest of
all rights, is not unrestricted license to act according to
one's will. It is subject to the far more overriding demands
and requirements of the greater number.
The SC noted the unhappy plight that has befallen female
accompanied by exploitative working conditions marked by
physical and personal abuse. The same, however, cannot be
said of our male workers. It was largely a matter of evidence and
not upon some arbitrary yardstick that the Government acted in
this case.
It is also incorrect to say that Department Order No. 1 prescribes a
total ban on overseas deployment. From scattered provisions of the
Order, it is evident that such a total ban has not been
contemplated. The consequence the deployment ban has on
the right to travel does not impair the right to travel. The
right to travel is subject, among other things, to the
requirements of "public safety," "as may be provided by
law." Department Order No. 1 is a valid implementation of
the Labor Code; its basic policy to "afford protection to
labor," pursuant to the respondent Department of Labor's
rule-making authority vested in it by the Labor Code . The
PASEI assumes that it is unreasonable simply because of its impact
on the right to travel, but as the SC have stated, the right itself is
not absolute. The disputed Order is a valid qualification thereto.
Neither is there merit in the contention that Department Order No.
1 constitutes an invalid exercise of legislative power. It is true
that police power is the domain of the legislature, but it
does not mean that such an authority may not be lawfully
delegated. The Labor Code itself vests the Department of
Labor and Employment with rulemaking powers in its
enforcement. Protection to labor" does not signify the
promotion of employment alone. What concerns the
Constitution more paramountly is that such an employment
be above all, decent, just, and humane. It is bad enough that
the country has to send its sons and daughters to strange lands
because it cannot satisfy their employment needs at home. Under

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these circumstances, the Government is duty-bound to insure that

our toiling expatriates have adequate protection, personally and
economically, while away from home.
10. St. Lukes Medical Center Employees Association and
Santos v NLRC

Petitioner Maribel Santos was hired as X-Ray

Technician in the Radiology Dept. of St Lukes Medical
Center in 1984.
In 1992, Congress enacted R.A. 7431 (Radiologic
Technology Act). The law required that no person shall
practice as a radiology and/or X-Ray technologist in the
Philippines without passing an examination and eventually
obtaining the proper certificate of registration from the
Board of Radiologic Technology.
The HR Department of St. Lukes issued a notice to all
practitioners of Radiologic Technology to comply with the
requirement of R.A. 7431. Otherwise, the unlicensed
employee will be transferred to an area which does not
require a license, IF a slot is available.
The Director of the Institute of Radiology issued a
memorandum advising her that only a license can assure
her of her continued employment and if she fails to secure
one, St. Lukes may be constrained to take action which may
include separation from employment.
Santos failed the examination and wasnt able to
acquire the license. St. Lukes offered her an option for early
retirement in lieu of separation pay. She declined said option
and St. Lukes was forced to issue a Notice of Separation.
The notice also states that St. Lukes exerted efforts to
transfer petitioner to other position/s, but her qualifications
did not fit with any of the present vacant positions.
Santos filed a complaint against St. Lukes for illegal
dismissal and non-payment of salaries, allowances and

other monetary benefits. The Labor Arbriter came out

with a decision ordering St. Lukes to pay Santos Php
115,500 representing her separation pay. The NLRC
affirmed the decision. CA also affirmed.

WON the CA committed grave abuse of discretion

NO. While the right of workers to security of tenure is
guaranteed by the Constitution, its exercise may be
reasonably regulated pursuant to the police power of the State
to safeguard health, morals, peace, education, order, safety and
the general welfare of the people.
Consequently, persons who desire to engage in the
learned professions requiring scientific or technical
knowledge may be required an examination. Like in the
field of Medicine, the regulation of which is a reasonable
method of protecting the health and safety of the public.
No malice or ill-will can be imputed upon private respondent
as the separation of Santos was undertaken by it conformably
to an existing statute. It is undeniable that her continued
employment without the required certification exposed
the hospital to possible sanctions and even a revocation
of it license to operate.
Santos was also given an ample amount of time to acquire
her license. It would be unreasonable to compel St. Lukes to
wait until its license is cancelled and it is materially injured
before removing the cause of impending evil. PETITION

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