Maternity Children’s Hospital vs.

Secretary of Labor
G.R. No. 78909
June 30 1984

Labor Law Defined

Facts:

Petitioner is a semi-government hospital, managed by the Board of Directors of the

Cagayan de Oro Women's Club and Puericulture Center, headed by Mrs. Antera
Dorado, as holdover President. The hospital derives its finances from the club itself
as well as from paying patients, averaging 130 per month. It is also partly subsidized
by the Philippine Charity Sweepstakes Office and the Cagayan De Oro City
government.
Petitioner has forty-one (41) employees. Aside from salary and living allowances,
the employees are given food, but the amount spent therefor is deducted from their
respective salaries (pp. 77-78, Rollo).

On May 23, 1986, ten (10) employees of the petitioner employed in different
capacities/positions filed a complaint with the Office of the Regional Director of
Labor and Employment, Region X, for underpayment of their salaries and ECOLAS,
which was docketed as ROX Case No. CW-71-86.

The Regional Director issued and order based on the reports of the Labor Standard
and Welfare Officers, directing payment of P723, 888.58 representing
underpayment of wages and ECOLAs to all the petitioner’s employees. Petitioner
appealed to the Minister of Labor and Employment which modified the decision as
to the period for the payment ECOLAs only. A motion for reconsideration was filed
by petitioner and was denied by the Secretary of Labor.

Held:

Labor standards refer to the minimum requirements prescribed by existing laws,

rules, and regulations relating to wages, hours of work, cost of living allowance and
other monetary and welfare benefits, including occupational, safety, and health
standards (Section 7, Rule I, Rules on the Disposition of Labor Standards Cases in
the Regional Office, dated September 16, 1987).

Under the present rules, a Regional Director exercises bothvisitorial

and enforcement power over labor standards cases, and is therefore
empowered to adjudicate money claims, provided there still exists an
employer-employee relationship, and the findings of the regional
office is not contested by the employer concerned.
Penaranda v Banganga Plywood Corporation

Facts:
Charlito Penaranda was hired as an employee of Baganga Corporation with a
monthly salary of P5,000 as Foreman/Boiler Head/ Shift Engineer to take charge of
the operations and maintenance of its steam plant boiler.

He alleges that he was illegally terminated and that his termination was without due
process and valid grounds. Furthermore, he was not paid his OT pay, premium pay
for working during holidays, and night shift differentials. So he filed an action for
illegal dismissal.

Hudson Chua, the General Manager of Baganga alleges that Penaranda’s separation
was done pursuant to Art. 238 of the Labor Code. The company was on temporary
closure due to repair and general maintenance and it applied for clearance with the
DOLE to shut down and dismiss employees. He claims that due to the insistence of
complainant, he was paid his separation benefits. But when the company partially
re-opened, Penaranda faild to re-apply.

Chua also alleges that since he is a managerial employee, he is not entitled to OT pay
and if ever he rendered services beyond the normal hours of work, there was no
office order/authorization for him to do so.

The Labor Arbiter ruled that there was no illegal dismissal and that Penaranda’s
complaint was premature because he was still employed with Baganga. As regards
the benefits, the Labor Arbiter found petitioner entitled to OT pay, premium pay for
working on rest days and attorney’s fees.

On appeal, NLRC deleted the award of OT pay, premium pay and attorney’s fees.

The CA dismissed Penaranda’s Petition for Certiorari based on procedural failures.

Issue:
Whether or not Penaranda is a regular employee entitled to monetary benefits
under Art. 82 of the Labor Code.

Held:
NO. Penaranda is part of the managerial staff which takes him out of the coverage of
labor standards. The Implementing Rules define members of a managerial staff as
those with the ff. responsibilities:

(1) The primary duty consists of the performance of work directly related to
management policies of the employer;
(2) Customarily and regularly exercise discretion and independent judgment;
(3) (i) Regularly and directly assist a proprietor or a managerial employee whose
primary duty consists of the management of the establishment in which he is
employed or subdivision thereof; or (ii) execute under general supervision work
along specialized or technical lines requiring special training, experience, or
knowledge; or (iii) execute under general supervision special assignments and
tasks; and
(4) who do not devote more than 20 percent of their hours worked in a workweek
to activities which are not directly and closely related to the performance of the
work described in paragraphs (1), (2), and (3) above."

Petitioner supervised the engineering section of the steam plant boiler. His work
involved overseeing the operation of the machines and the performance of the
workers in the engineering section. This work necessarily required the use of
discretion and independent judgment to ensure the proper functioning of the steam
plant boiler. As supervisor, petitioner is deemed a member of the managerial staff.

Even Penaranda admitted that he was a supervisor. In his Position Paper, he stated
that he was the foreman responsible for the operation of the boiler. The term
foreman implies that he was the representative of management over the workers
and the operation of the department. His classification as supervisor is further
evident from the manner his salary was paid. He belonged to the 10% of
respondent’s 354 employees who were paid on a monthly basis; the others were
paid only on a daily basis.

*No justification to award overtime pay and premium pay for rest days to
Penaranda.

BATONG BUHAY GOLDMINES V DELA SERNA

PURISIMA, August 6, 1999

FACTS
- Employees filed a complaint against Batong Buhay for: unpaid salaries from March 16, 1987 to
present, unpaid and ECOLA differentials under Wage Order Nos. 2 and 5, unpaid 13th months pay
for 1985 and 1986, and upaid vacation/sick/compensatory leave benefits.
- Labor Standards and Welfare Officers & Regional Director: Batong Buhay must pay Ty et al.
P4,818,746.40
- Regional Director directed Batong Buhay to put up a cash or surety bond otherwise a writ of
execution will be issued.
- The Special Sheriff seized three units of Peterbuilt trucks and then sold the same by public
auction. Various materials and motor vehicles were also seized on different dates and sold at
public auction.
- Batong Buhay finally posted a supersedeas bond and appealed the Order contending that the
Regional Director had no jurisdiction over the case.
- Undersec dela Serna upheld the jurisdiction of the Regional Director and annulled all the auction
sales conducted by Special Sheriff. MR denied.
- Motion for Intervention was filed by MFT Corporation and Salter Holdings Pty., Ltd. For exclusion
from annulment of the properties sold at the auction sale. Granted. MR denied.

ISSUES
1. WON the Regional Director has jurisdiction over the complaint filed by the employees of BBGMI
2. WON the auction sales conducted by the said Special Sheriff are valid

HELD
1. YES
- The subject labor standards case of the petition arose from the visitorial and enforcement powers
by the Regional Director of DOLE.
- Labor standards refers to the minimum requirements prescribed by existing laws, rules and
regulations relating to wages, hours of work, cost of living allowance and other monetary and
welfare benefits, including occupational, safety and health standards. Labor standards cases are
governed by Article 128(b) of the Labor Code.
- Even in the absence of E.O. 111 , Regional Directors already had enforcement powers over
money claims, effective under P.D. 850, issued on December 16, 1975, which transferred labor
standards cases from the arbitration system to the enforcement system.
- E.O. No. 111 was issued on December 24, 1986 or three(3) months after the promulgation of the
Secretary of Labor's decision upholding private respondents' salary differentials and ECOLAs on
September 24, 1986. The amendment of the visitorial and enforcement powers of the Regional
Director (Article 128(b)) by said E.O. 111 reflects the intention enunciated in Policy Instructions
Nos. 6 and 37 to empower the Regional Directors to resolve uncontested money claims in cases
where an employer-employee relationship still exists. This intention must be given weight and
entitled to great respect.
- The Court would have ruled differently had the petitioner shown that subject labor standards case
is within the purview of the exception clause in Article 128 (b) of the Labor Code. Said provision
requires the concurrence of the following elements in order to divest the Regional Director or his
representatives of jurisdiction, to wit: (a) that the petitioner (employer) contests the findings of the
labor regulations officer and raises issues thereon; (b) that in order to resolve such issues, there is
a need to examine evidentiary matters; and (c) that such matters are not verifiable in the normal
course of inspection.
- Petitioner's refusal to allow the Labor Standards and Welfare Officers to conduct inspection in the
premises of their head office and the failure to file their position paper is equivalent to a waiver of
its right to contest the claims of the employees.
- This involves a labor standards case and it is in keeping with the law that "the worker need not
litigate to get what legally belongs to him, for the whole enforcement machinery of the Department
of Labor exists to insure its expeditious delivery to him free of charge.
- The present law, RA 7730, can be considered a curative statute to reinforce the conclusion that
the Regional Director has jurisdiction over the present labor standards case.
2. NO
- As a general rule, findings of fact and conclusion of law arrived at by quasi-judicial agencies are
not to be disturbed absent any showing of grave abuse of discretion tainting the same.
- There was grave abuse of discretion when the Undersec, without any evidentiary support,
adjudged such prices as "scandalously low". He merely relied on the self-serving assertion by the
petitioner that the value of the auctioned properties was more than the price bid.
- The sales are null and void since on the properties of petitioner involved was constituted a
mortgage between petitioner and the Development Bank of the Philippines

People v. Vera Reyes, 67 Phil 190

Subject: Labor Standards
Doctrine: Police Power (Basis of State’s power to intervene)
Facts:
The defendant was charged with a violation of Act No. 2549, as amended by Acts Nos.
3085 and 3958 The information alleged that from September 9 to October 28, 1936, and
for the some time after, the accused, in his capacity as president and general manager of
the Consolidated Mines, having engaged the services of Severa Velasco de Vera as
stenographer, at an agreed salary of P35 a month willfully and illegally refused to pay the
salary of said stenographer corresponding to the above-mentioned period of time, which
was long due and payable, in spite of her repeated demands.

The accused interposed a demurrer on the ground that the facts alleged in the information
do not constitute any offense, and that even if they did, the laws penalizing it are
unconstitutional.

After the hearing, the court sustained the demurrer, declaring unconstitutional the last
part of section 1 of Act No. 2549 as last amended by Act No. 3958, which considers as an
offense the facts alleged in the information, for the reason that it violates the
constitutional prohibition against imprisonment for debt, and dismissed the case, with
costs de oficio.

In this appeal the Solicitor-General contends that the court erred in declaring Act No.
3958 unconstitutional.

ISSUE: Whether the said constitutional provision is unconstitutional.

HELD:
No. The last part of section 1 considers as illegal the refusal of an employer to pay, when
he can do so, the salaries of his employees or laborers on the fifteenth or last day of every
month or on Saturday of every week, with only two days extension, and the nonpayment
of the salary within the periods specified is considered as a violation of the law.

The same Act exempts from criminal responsibility the employer who, having failed to
pay the salary, should prove satisfactorily that it was impossible to make such payment.

The court held that this provision is null because it violates the provision of section 1
(12), Article III, of the Constitution, which provides that no person shall be imprisoned
for debt.
We do not believe that this constitutional provision has been correctly applied in this
case. A close perusal of the last part of section 1 of Act No. 2549, as amended by section
1 of Act No. 3958, will show that its language refers only to the employer who, being
able to make payment, shall abstain or refuse to do so, without justification and to the
prejudice of the laborer or employee. An employer so circumstanced is not unlike a
person who defrauds another, by refusing to pay his just debt. In both cases the deceit or
fraud is the essential element constituting the offense. The first case is a violation of Act
No. 3958, and the second isestafa punished by the Revised Penal Code. In either case the
offender cannot certainly invoke the constitutional prohibition against imprisonment for
debt.

Another doctrine:
Police power is the power inherent in a government to enact laws, within constitutional
limits, to promote the order, safety, health, morals, and general welfare of society. (12 C.
J., p. 904.) In the exercise of this power the Legislature has ample authority to approve
the disputed portion of Act No. 3958 which punishes the employer who, being able to do
so, refuses to pay the salaries of his laborers or employers in the specified periods of
time.

Undoubtedly, one of the purposes of the law is to suppress possible abuses on the part of
employers who hire laborers or employees without paying them the salaries agreed upon
for their services, thus causing them financial difficulties.

Without this law, the laborers and employees who earn meager salaries would be
compelled to institute civil actions which, in the majority of cases, would cost them more
than that which they would receive in case of a decision in their favor.

Philippine Association of Services Exporters Inc v Drilon

Facts:

The petitioner, Philippine Association of Service Exporters, Inc. (PASEI, for short), a
firm "engaged principally in the recruitment of Filipino workers, male and female,
for overseas placement," challenges the Constitutional validity of Department Order
No. 1, Series of 1988, of the Department of Labor and Employment, in the character
of "GUIDELINES GOVERNING THE TEMPORARY SUSPENSION OF DEPLOYMENT OF
FILIPINO DOMESTIC AND HOUSEHOLD WORKERS," in this petition for certiorari
and prohibition. Specifically, the measure is assailed for "discrimination against
males or females;" 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 is held likewise to be an invalid exercise of the lawmaking power, police
power being legislative, and not executive, in character.

On May 25, 1988, 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 on March 8, 1988, the respondent Labor
Secretary lifted the deployment ban in the states of Iraq, Jordan, Qatar, Canada,
Hongkong, United States, Italy, Norway, Austria, and Switzerland. * In submitting the
validity of the challenged "guidelines," the Solicitor General invokes the police
power of the Philippine State.

Issue:

Whether or not the Department Order 1, series of 1988, of the Department of Labor
and Employment valid.

Held:

"The police power of the State ... is a power coextensive with self- protection, and it
is not inaptly termed the "law of overwhelming necessity." It may be said to be that
inherent and plenary power in the State which enables it to prohibit all things
hurtful to the comfort, safety, and welfare of society."

The consequence the deployment ban has on the right to travel does not impair the
right. 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, in particular, 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 petitioner assumes that it is unreasonable simply
because of its impact on the right to travel, but as we 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. As we have mentioned, the Labor Code itself vests the Department of
Labor and Employment with rulemaking powers in the enforcement whereof.

CASE DIGEST: ST. LUKE'S MEDICAL CENTER EMPLOYEE'S

ASSOCIATION-AFW, petitioners vs. NLRC, respondents
G.R. No. 162053 March 7, 2007
Doctrine: Police Power

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 to take an examination as a prerequisite to engaging in their chosen
careers.

Facts:
Petitioner Maribel S. Santos was hired as X-Ray Technician in the Radiology
department of private respondent St. Luke's Medical Center, Inc. (SLMC) on
October 13, 1984. She is a graduate of Associate in Radiologic Technology from
The Family Clinic Incorporated School of Radiologic Technology. On April 22,
1992, Congress passed and enacted Republic Act No. 7431 known as the
"Radiologic Technology Act of 1992." Said law requires that no person shall
practice or offer to practice as a radiology and/or x-ray technologist in the
Philippines without having obtained the proper certificate of registration from the
Board of Radiologic Technology. On September 12, 1995, the Assistant Executive
Director-Ancillary Services and HR Director of private respondent SLMC issued a
final notice to all practitioners of Radiologic Technology to comply with the
requirement of Republic Act No. 7431 by December 31, 1995; otherwise, the
unlicensed employee will be transferred to an area which does not require a
license to practice if a slot is available.The Director of the Institute of Radiology
issued a final notice to petitioner Maribel S. Santos requiring the latter to comply
with Republic Act. No. 7431 by taking and passing the forthcoming examination
scheduled in June 1997; otherwise, private respondent SLMC may be compelled
to retire her from employment should there be no other position available where
she may be absorbed. On November 23, 1998, the Director of the Institute of
Radiology issued a notice to petitioner Maribel S. Santos informing the latter that
the management of private respondent SLMC has approved her retirement in lieu
of separation pay. Private respondent SLMC issued a "Notice of Separation from
the Company" to petitioner Maribel S. Santos effective December 30, 1998 in
view of the latter's refusal to accept private respondent SLMC's offer for early
retirement. On January 6, 1999, the Personnel Manager of private respondent
SLMC again issued a "Notice of Separation from the Company" to petitioner
Maribel S. Santos effective February 5, 1999 after the latter failed to present/
submit her appeal for rechecking to the Professional Regulation Commission
(PRC) of the recent board examination which she took and failed. On January 6,
1999, the Personnel Manager of private respondent SLMC again issued a "Notice
of Separation from the Company" to petitioner Maribel S. Santos effective
February 5, 1999 after the latter failed to present/ submit her appeal for
rechecking to the Professional Regulation Commission (PRC) of the recent board
examination which she took and failed.
NLRC rendered a decision in favor of Petitioner

Issue: Whether the CA overlooked certain material facts and circumstances on

petitioners' legal claim in relation to the complaint for illegal dismissal.

Held: 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 to take an examination as a prerequisite to engaging in their chosen
careers

SERRANO v. GALLANT MARITIME SERVICES INC. & MARLOWE

NAVIGATION CO., INC.
G.R. No. 167614. March 24, 2009

Facts:

Petitioner was hired by Gallant Maritime Services, Inc. and Marlow Navigation Co., Ltd.
(respondents) under a POEA-approved Contract of Employment. On March 19, 1998, the date of
his departure, petitioner was constrained to accept a downgraded employment contract for the
position of Second Officer with a monthly salary of US$1,000.00, upon the assurance and
representation of respondents that he would be made Chief Officer by the end of April. However,
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.

Petitioner's employment contract was for a period of 12 months or from March 19, 1998 up
to March 19, 1999, but at the time of his repatriation on May 26, 1998, he had served only two (2)
months and seven (7) days of his contract, leaving an unexpired portion of nine (9) months and
twenty-three (23) days.

Petitioner filed with the Labor Arbiter (LA) a Complaint against respondents for
constructive dismissal and for payment of his money claims. LA rendered the dismissal of
petitioner illegal and awarding him monetary benefits. Respondents appealed to the NLRC to
question the finding of the LA. Likewise, 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.

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. Petitioner filed a Motion for Partial Reconsideration; he questioned the constitutionality
of the subject clause. Petitioner filed a Petition for Certiorari with the CA, reiterating the
constitutional challenge against the subject clause. CA affirmed the NLRC ruling on the reduction
of the applicable salary rate; however, the CA skirted the constitutional issue raised by petitioner.

The last clause in the 5th paragraph of Section 10, Republic Act (R.A.) No. 8042, to wit:

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.

Applying the subject clause, the NLRC and the CA computed the lump-sum salary of
petitioner at the monthly rate of US$1,400.00 covering the period of three months out of the
unexpired portion of nine months and 23 days of his employment contract or a total of
US$4,200.00.

Impugning the constitutionality of the subject clause, petitioner contends that, in addition to
the US$4,200.00 awarded by the NLRC and the CA, he is entitled to US$21,182.23 more or a total
of US$25,382.23, equivalent to his salaries for the entire nine months and 23 days left of his
employment contract, computed at the monthly rate of US$2,590.00

Issue:
1.) Is petitioner entitled to his monetary claim which is the lump-sum salary for the entire
unexpired portion of his 12-month employment contract, and not just for a period of
three months?
2.) Should petitioner’s overtime and leave pay form part of the salary basis in the
computation of his monetary award, because these are fixed benefits that have been
stipulated into his contract?

Held:
1.) Yes. Petitioner is awarded his salaries for the entire unexpired portion of his
employment contract consisting of nine months and 23 days computed at the rate of US$1,400.00
per month. The subject clause “or for three months for every year of the unexpired term, whichever
is less” in the 5th paragraph of Section 10 of Republic Act No. 8042 is declared unconstitutional.

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

The Court concludes that the subject clause contains a suspect classification in that, in
the computation of the monetary benefits of fixed-term employees who are illegally discharged, it
imposes a 3-month cap on the claim of OFWs with an unexpired portion of one year or more in
their contracts, but none on the claims of other OFWs or local workers with fixed-term
employment. The subject clause singles out one classification of OFWs and burdens it with a
peculiar disadvantage.
 The Court further holds that the subject clause violates petitioner's right to substantive due
process, for it deprives him of property, consisting of monetary benefits, without any existing valid
governmental purpose. The subject clause being unconstitutional, petitioner is entitled to his salaries
for the entire unexpired period of nine months and 23 days of his employment contract, pursuant to
law and jurisprudence prior to the enactment of R.A. No. 8042.

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

By the foregoing definition alone, there is no basis for the automatic inclusion of
overtime and holiday pay in the computation of petitioner's monetary award; unless there is
evidence that he performed work during those periods.

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

Calalang v Williams (Labor Standards)

Calalang v Williams
GR No. 47800
December 2, 1940

FACTS:

Pursuant to the power delegated to it by the Legislature, the Director

of Public Works promulgated rules and regulations pertaining to the
closure of Rosario Street and Rizal Avenue to traffic of
animal-drawn vehicles for a year from the date of the opening of the
Colgante Bridge to traffic.

Among others, the petitioner Calalang, concerned citizen, aver that the
rules and regulations complained of:
 infringe upon constitutional precept on the promotion of social justice
to insure the well being and economic security of all people;
 and that it constitutes unlawful interference with legitimate business
or trade and abridge the right to personal liberty and freedom of
locomotion.

ISSUE: Whether or not the rules and regulation promote social

justice.

HELD:
YES, it still promotes social justice. In enacting the said law, the
National Assembly was prompted by considerations of public
convenience and welfare.

The promotion of Social Justice is to be adhered not through a

mistaken sympathy towards any given group (e.g. the poor - because
social justice is bringing the greatest good to the greatest number, not
necessarily just the poor like the drivers of the animal-drawn
vehicles).

Social justice:
: "neither communism, nor despotism, nor atomism, nor anarchy," but
the humanization of laws and the equalization of social and economic
force by the State so that justice in its rational and objectively secular
conception may at least be approximated.

: the promotion of the welfare of all the people, the adoption by the
Government of measures calculated to insure economic stability of all
the competent elements of society, through the maintenance of a
proper economic and social equilibrium in the interrelations of the
members of the community, constitutionally, through the adoption
of measures legally justifiable, or extra-constitutionally, through the
exercise of powers underlying the existence of all governments on the
time-honored principle of salus populi est suprema lex.

: must be founded on the recognition of the necessity of

interdependence among divers and diverse units of a society and of
the protection that should be equally and evenly extended to all
groups as a combined force in our social and economic life, consistent
with the fundamental and paramount objective of the state of
promoting the health, comfort and quiet of all persons, and of bringing
about "the greatest good to the greatest number."

RATIO:
(1) Liberty is a blessing without which life is a misery, but liberty
should not be made to prevail over authority because then society will
fall into anarchy.

(2)The citizen should achieve the required balance of liberty and

authority in his mind through education and personal discipline so that
there may be established the resultant equilibrium, which means
peace and order and happiness of all.

PHILIPPINE BLOOMING MILLS EMPLOYMENT ORGANIZATION, NICANOR

TOLENTINO, FLORENCIO, PADRIGANO RUFINO, ROXAS MARIANO DE LEON,
ASENCION PACIENTE, BONIFACIO VACUNA, BENJAMIN PAGCU and RODULFO
MUNSOD, petitioners, vs. PHILIPPINE BLOOMING MILLS CO., INC. and COURT OF
INDUSTRIAL RELATIONS, respondents.

Facts:

Philippine Blooming Employees Organization (PBMEO) decided to stage a mass

demonstration in front of Malacañang to express their grievances against the alleged
abuses of the Pasig Police.

After learning about the planned mass demonstration, Philippine Blooming Mills Inc.,
called for a meeting with the leaders of the PBMEO. During the meeting, the planned
demonstration was confirmed by the union. But it was stressed out that the
demonstration was not a strike against the company but was in fact an exercise of the
laborers' inalienable constitutional right to freedom of expression, freedom of speech and
freedom for petition for redress of grievances.

The company asked them to cancel the demonstration for it would interrupt the normal
course of their business which may result in the loss of revenue. This was backed up
with the threat of the possibility that the workers would lose their jobs if they pushed
through with the rally.

A second meeting took place where the company reiterated their appeal that while the
workers may be allowed to participate, those from the 1st and regular shifts should not
absent themselves to participate, otherwise, they would be dismissed. Since it was too
late to cancel the plan, the rally took place and the officers of the PBMEO were
eventually dismissed for a violation of the ‘No Strike and No Lockout’ clause of
their Collective Bargaining Agreement.

The lower court decided in favor of the company and the officers of the PBMEO were
found guilty of bargaining in bad faith. Their motion for reconsideration was subsequently
denied by the Court of Industrial Relations for being filed two days late.

Issue:

Whether or not the workers who joined the strike violated the CBA?

Held:
No. While the Bill of Rights also protects property rights, the primacy of human rights
over property rights is recognized. Because these freedoms are "delicate and
vulnerable, as well as supremely precious in our society" and the "threat of sanctions
may deter their exercise almost as potently as the actual application of sanctions," they
"need breathing space to survive," permitting government regulation only "with narrow
specificity." Property and property rights can be lost thru prescription; but human rights
are imprescriptible. In the hierarchy of civil liberties, the rights to freedom of expression
and of assembly occupy a preferred position as they are essential to the preservation
and vitality of our civil and political institutions; and such priority "gives these liberties the
sanctity and the sanction not permitting dubious intrusions."

The freedoms of speech and of the press as well as of peaceful assembly and of petition
for redress of grievances are absolute when directed against public officials or "when
exercised in relation to our right to choose the men and women by whom we shall be
governed.”

LOPEZ v METROPOLITAN WATERWORKS AND SEWERAGE SYSTEM

G.R. No. 154472; June 30, 2005; Tinga, J.
Digest prepared by Jackie Canlas

Note: Sorry, mahaba yung kaso eh. The ratio part just discussed the 4-fold test nung
ER-EE relationship so pwede niyo na lang iscan nang mabilis. Pero yung nakabold
na part, I think yun yung hinahanap ni Ma’am, kaya siya under the subheading
“Nature of Work”.

FACTS:
 By virtue of an Agreement, petitioners were engaged by the MWSS as collectors-
contractors, wherein the former agreed to collect from the concessionaires of MWSS,
charges, fees, assessments of rents for water, sewer and/or plumbing services which the
MWSS bills from time to time.
 In 1997, MWSS entered into a Concession Agreement with Manila Water Service, Inc.
and Benpress-Lyonnaise, wherein the collection of bills was transferred to said private
concessionaires, effectively terminating the contracts of service between petitioners
and MWSS.
 Regular employees of the MWSS were paid their retirement benefits, but not
petitioners. Instead, they were refused said benefits.
 Petitioners filed a complaint with the CSC, but their claims were denied in a CSC
Resolution, stating that:
o their contract of service explicitly provides that a bill collector-contractor is not
an MWSS employee
o contract services/job orders are not considered government services, which do
not have to be submitted to the CSC for approval, unlike contractual and
plantilla appointments (CSC Memo No. 38)
o crediting of services for purposes of retirement only for such services supported
by appointment (CSC Memo No. 4)
 o not being permanent employees of MWSS, not entitled to retirement benefits
and terminal leave pay (subsequent Memo with no specific number)
 MR of CSC Resolution denied. CA affirmed CSC Resolution.

ISSUE/RULING: WON petitioners were employees of the MWSS and,

consequently, entitled to the benefits they claim - YES

RATIO:
 For purposes of determining the existence of employer-employee relationship, the
Court has consistently adhered to the four-fold test, namely: (1) whether the alleged
employer has the power of selection and engagement of an employee; (2) whether he
has control of the employee with respect to the means and methods by which work is to
be accomplished; (3) whether he has the power to dismiss; and (4) whether the
employee was paid wages. Of the four, the control test is the most important element.
 MWSS wielded its power of selection when it contracted with the individual petitioners,
undertaking separate contracts or agreements. The same goes true for the power to
dismiss, with the Agreement stating causes for termination.
 On the issue of remuneration, the “commissions” due petitioners were based on the
bills collected as per the schedule indicated in the Agreement. Significantly, MWSS
granted petitioners benefits usually given to employees, to wit: COLA, meal, emergency,
and traveling allowances, hazard pay, cash gift, and other bonuses. Petitioners rendered
services to MWSS for which they were paid and given similar benefits due the other
employees of MWSS.
 On the aspect of control, MWSS makes an issue out of the proviso in the Agreement
that specifically denies the existence of employer-employee relationship between it and
petitioners. But the employment status of a person is defined and prescribed by law and
not by what the parties say it should be. In addition, the control test merely calls for the
existence of the right to control, and not the exercise thereof.
 Petitioners are indeed regular employees of the MWSS. The primary standard of
determining regular employment is the reasonable connection between the particular
activity performed by the employee in relation to the usual business or trade of the
employer. The connection can be determined by considering the nature of the work
performed and its relation to the scheme of the particular business or trade in its
entirety. Likewise, the repeated and continuing need for the performance of the job
has been deemed sufficient evidence of the necessity, if not indispensability of the
activity to the business. Some of the petitioners had rendered more than two decades
of service to the MWSS. The continuous and repeated rehiring of these bill collectors
indicates the necessity and desirability of their services, as well as the importance of the
role of bill collectors in the MWSS.

DISPOSITION
1. CA Decision and CSC Resolution SET ASIDE.
2. MWSS is ordered to pay terminal leave pay and separation pay and/or
severance pay on the basis of remunerations/commissions, allowances and
bonuses each were actually receiving at the time of termination of their
employment as contract collectors of MWSS.
3. Case was remanded to the CSC for the computation of the above awards.
FUJI TELEVISION NETWORK, INC. VS. ARLENE S. ESPIRITU
G.R. NO. 204944-45 DECEMBER 3, 2014
J. Leonen

FACTS: Arlene S. Espiritu (Arlene) was engaged by Fuji Television Network,

Inc. (Fuji) as a news correspondent/producer tasked to report Philippine news to
Fuji through its Manila Bureau field office. The employment contract was
initially for one year, but was successively renewed on a yearly basis with salary
adjustments upon every renewal.

In January 2009, Arlene was diagnosed with lung cancer. She informed Fuji
about her condition, and the Chief of News Agency of Fuji, Yoshiki Aoki,
informed the former that the company had a problem with renewing her contract
considering her condition. Arlene insisted she was still fit to work as certified by
her attending physician.

After a series of verbal and written communications, Arlene and Fuji signed a
non-renewal contract. In consideration thereof, Arlene acknowledged the receipt
of the total amount of her salary from March-May 2009, year-end bonus, mid-
year bonus and separation pay. However, Arlene executed the non-renewal
contract under protest.

Arlene filed a complaint for illegal dismissal with the NCR Arbitration Branch of
the NLRC, alleging that she was forced to sign the non-renewal contract after
Fuji came to know of her illness. She also alleged that Fuji withheld her salaries
and other benefits when she refused to sign, and that she was left with no other
recourse but to sign the non-renewal contract to get her salaries.

ISSUES:
1. Was Arlene an independent contractor?
2. Was Arlene a regular employee?
3. Was Arlene illegally dismissed?
4. Did the Court of Appeals correctly awarded reinstatement, damages and
attorney’s fees?

LAWS:
Art. 280. Regular and casual employment. The provisions of written agreement
to the contrary notwithstanding and regardless of the oral agreement of the
parties, an employment shall be deemed to be regular where the employee has
been engaged to perform activities which are usually necessary or desirable in
the usual business or trade of the employer, except where the employment has
been fixed for a specific project or undertaking the completion or termination of
which has been determined at the time of the engagement of the employee or
where the work or services to be performed is seasonal in nature and the
employment is for the duration of the season.

An employment shall be deemed to be casual if it is not covered by the preceding

paragraph; Provided, That, any employee who has rendered at least one year of
service, whether such service is continuous or broken, shall be considered a
regular employee with respect to the activity in which he is employed and his
employment shall continue while such activity exist.

Art. 279. Security of tenure. In cases of regular employment, the employer shall
not terminate the services of an employee except for a just cause of when
authorized by this Title. An employee who is unjustly dismissed from work shall
be entitled to reinstatement without loss of seniority rights and other privileges
and to his full backwages, inclusive of allowances, and to his other benefits or
their monetary equivalent computed from the time his compensation was
withheld from him up to the time of his actual reinstatement.

Thus, on the right to security of tenure, no employee shall be dismissed, unless

there are just or authorized causes and only after compliance with procedural
and substantive due process is conducted.

Art. 284. Disease as ground for termination. An employer may terminate the
services of an employee who has been found to be suffering from any disease
and whose continued employment is prohibited by law or is prejudicial to his
health as well as to the health of his co-employees: Provided, That he is paid
separation pay equivalent to at least one (1) month salary or to one-half (1/2)
month salary for every year of service, whichever is greater, a fraction of at least
six (6) months being considered as one (1) whole year.

Book VI, Rule 1, Section 8 of the Omnibus Rules Implementing the Labor
Code. Disease as a ground for dismissal. – Where the employee suffers from a
disease and his continued employment is prohibited by law or prejudicial to his
health or to the health of his co-employees, the employer shall not terminate his
employment unless there is a certification by a competent public health authority
that the disease is of such nature or at such a stage that it cannot be cured within
a period of six (6) months even with proper medical treatment. If the disease or
ailment can be cured within the period, the employer shall not terminate the
employee but shall ask the employee to take a leave. The employer shall reinstate
such employee to his former position immediately upon the restoration of his
normal health.

CASE HISTORY:
Labor Arbiter dismissed the complaint and held that Arlene was not a regular
employee but an independent contractor.

The NLRC reversed the Labor Arbiter’s decision and ruled that Arlene was a
regular employee since she continuously rendered services that were necessary
and desirable to Fuji’s business.

The Court of Appeals affirmed that NLRC ruling with modification that Fuji
immediately reinstate Arlene to her position without loss of seniority rights and
that she be paid her backwages and other emoluments withheld from her. The
Court of Appeals agreed with the NLRC that Arlene was a regular employee,
engaged to perform work that was necessary or desirable in the business of Fuji,
and the successive renewals of her fixed-term contract resulted in regular
employment. The case of Sonza does not apply in the case because Arlene was
not contracted on account of a special talent or skill. Arlene was illegally
dismissed because Fuji failed to comply with the requirements of substantive
and procedural due process. Arlene, in fact, signed the non-renewal contract
under protest as she was left without a choice.

Fuji filed a petition for review on certiorari under Rule 45 before the Supreme
Court, alleging that Arlene was hired as an independent contractor; that Fuji had
no control over her work; that the employment contracts were renewed upon
Arlene’s insistence; that there was no illegal dismissal because she freely agreed
not to renew her fixed-term contract as evidenced by her email correspondences.

Arlene filed a manifestation stating that the SC could not take jurisdiction over
the case since Fuji failed to authorize Corazon Acerden, the assigned attorney-in-
fact for Fuji, to sign the verification.

RULING:
1. Arlene was not an independent contractor.

Fuji alleged that Arlene was an independent contractor citing the Sonza case. She
was hired because of her skills. Her salary was higher than the normal rate. She
had the power to bargain with her employer. Her contract was for a fixed term. It
also stated that Arlene was not forced to sign the non-renewal agreement,
considering that she sent an email with another version of her non-renewal
agreement.

Arlene argued (1) that she was a regular employee because Fuji had control and
supervision over her work; (2) that she based her work on instructions from Fuji;
(3) that the successive renewal of her contracts for four years indicated that her
work was necessary and desirable; (4) that the payment of separation pay
indicated that she was a regular employee; (5) that the Sonza case is not
applicable because she was a plain reporter for Fuji; (6) that her illness was not a
ground for her dismissal; (7) that she signed the non-renewal agreement because
she was not in a position to reject the same.

Distinctions among fixed-term employees, independent contractors, and

regular employees
Fixed Term Employment

1) The fixed period of employment was knowingly and voluntarily agreed upon
by the parties without any force, duress, or improper pressure being brought to
bear upon the employee and absent any other circumstances vitiating his
consent; or

2) It satisfactorily appears that the employer and the employee dealt with each
other on more or less equal terms with no moral dominance exercised by the
former or the latter.
These indications, which must be read together, make the Brent doctrine
applicable only in a few special cases wherein the employer and employee are on
more or less in equal footing in entering into the contract. The reason for this is
evident: when a prospective employee, on account of special skills or market
forces, is in a position to make demands upon the prospective employer, such
prospective employee needs less protection than the ordinary worker. Lesser
limitations on the parties’ freedom of contract are thus required for the
protection of the employee.155 (Citations omitted)

For as long as the guidelines laid down in Brent are satisfied, this court will
recognize the validity of the fixed-term contract. (GMA Network, Inc. vs. Pabriga)
Independent Contractor
One who carries on a distinct and independent business and undertakes to
perform the job, work, or service on its own account and under one’s own
responsibility according to one’s own manner and method, free from the control
and direction of the principal in all matters connected with the performance of
the work except as to the results thereof.

No employer-employee relationship exists between the independent contractors

and their principals.

Art. 106. Contractor or subcontractor. Whenever an employer enters into a

contract with another person for the performance of the former’s work, the
employees of the contractor and of the latter’s subcontractor, if any, shall be paid
in accordance with the provisions of this Code.

XXX
The Secretary of Labor and Employment may, by appropriate regulations,
restrict or prohibit the contracting-out of labor to protect the rights of workers
established under this Code. In so prohibiting or restricting, he may make
appropriate distinctions between labor-only contracting and job contracting as
well as differentiations within these types of contracting and determine who
among the parties involved shall be considered the employer for purposes of this
Code, to prevent any violation or circumvention of any provision of this Code.

There is “labor-only” contracting where the person supplying workers to an

employer does not have substantial capital or investment in the form of tools,
equipment, machineries, work premises, among others, and the workers
recruited and placed by such person are performing activities which are directly
related to the principal business of such employer. In such cases, the person or
intermediary shall be considered merely as an agent of the employer who shall
be responsible to the workers in the same manner and extent as if the latter were
directly employed by him.

Department Order No. 18-A, Series of 2011, Section 3

(c) . . . an arrangement whereby a principal agrees to put out or farm out with a
contractor the performance or completion of a specific job, work or service within
a definite or predetermined period, regardless of whether such job, work or
service is to be performed or completed within or outside the premises of the
principal.
This department order also states that there is a trilateral relationship in
legitimate job contracting and subcontracting arrangements among the principal,
contractor, and employees of the contractor. There is no employer-employee
relationship between the contractor and principal who engages the contractor’s
services, but there is an employer-employee relationship between the contractor
and workers hired to accomplish the work for the
principal. chanRoblesvirtualLawlibrary
162

Jurisprudence has recognized another kind of independent contractor:

individuals with unique skills and talents that set them apart from ordinary
employees. There is no trilateral relationship in this case because the
independent contractor himself or herself performs the work for the principal. In
other words, the relationship is bilateral.

XXX

There are different kinds of independent contractors: those engaged in legitimate

job contracting and those who have unique skills and talents that set them apart
from ordinary employees.

Since no employer-employee relationship exists between independent

contractors and their principals, their contracts are governed by the Civil Code
provisions on contracts and other applicable laws.
Regular Employees

Contracts of employment are different and have a higher level of regulation

because they are impressed with public interest. Article 13, Section 3 of the 1987
Constitution provides full protection to labor.

Apart from the Constitutional guarantee, Article 1700 of the Civil Code states
that : The relations between capital and labor are not merely contractual. They
are so impressed with public interest that labor contracts must yield to the
common good. Therefore, such contracts are subject to the special laws on labor
unions, collective bargaining, strikes and lockouts, closed shop, wages, working
conditions, hours of labor and similar subjects.

In contracts of employment, the employer and the employee are not on equal
footing. Thus, it is subject to regulatory review by the labor tribunals and courts
of law. The law serves to equalize the unequal. The labor force is a special class
that is constitutionally protected because of the inequality between capital and
labor.176 This presupposes that the labor force is weak.

The level of protection to labor should vary from case to caese. When a
prospective employee, on account of special skills or market forces, is in a
position to make demands upon the prospective employer, such prospective
employee needs less protection than the ordinary worker.

The level of protection to labor must be determined on the basis of the nature of
the work, qualifications of the employee, and other relevant circumstances such
as but not limited to educational attainment and other special qualifications.

Fuji’s argument that Arlene was an independent contractor under a fixed-term

contract is contradictory. Employees under fixed-term contracts cannot be
independent contractors because in fixed-term contracts, an employer-employee
relationship exists. The test in this kind of contract is not the necessity and
desirability of the employee’s activities, “but the day certain agreed upon by the
parties for the commencement and termination of the employment
relationship.” For regular employees, the necessity and desirability of their work
in the usual course of the employer’s business are the determining factors. On
the other hand, independent contractors do not have employer-employee
relationships with their principals.

To determine the status of employment, the existence of employer-employee

relationship must first be settled with the use of the four-fold test, especially the
qualifications for the power to control.

The distinction is in this guise:

Rules that merely serve as guidelines towards the achievement of a mutually
desired result without dictating the means or methods to be employed creates no
employer-employee relationship; whereas those that control or fix the
methodology and bind or restrict the party hired to the use of such means creates
the relationship.

In appliacation, Arlene was hired by Fuji as a news producer, but there was no
evidence that she was hired for her unique skills that would distinguish her from
ordinary employees. Her monthly salary appeared to be a substantial sum. Fuji
had the power to dismiss Arlene, as provided for in her employment contract.
The contract also indicated that Fuji had control over her work as she was
rquired to report for 8 hours from Monday to Friday. Fuji gave her instructions
on what to report and even her mode of transportation in carrying out her
functions was controlled.

Therefore, Arlene could not be an independent contractor.

2. Arlene was a regular employee with a fixed-term contract.

In determining whether an employment should be considered regular or non-

regular, the applicable test is the reasonable connection between the particular
activity performed by the employee in relation to the usual business or trade of
the employer. The standard, supplied by the law itself, is whether the work
undertaken is necessary or desirable in the usual business or trade of the
employer, a fact that can be assessed by looking into the nature of the services
rendered and its relation to the general scheme under which the business or
trade is pursued in the usual course. It is distinguished from a specific
undertaking that is divorced from the normal activities required in carrying on
the particular business or trade.

However, there may be a situation where an employee’s work is necessary but is

not always desirable in the usual course of business of the employer. In this
situation, there is no regular employment.

Fuji’s Manila Bureau Office is a small unit213 and has a few employees. Arlene
had to do all activities related to news gathering.

A news producer “plans and supervises newscast [and] works with reporters in
the field planning and gathering information, including monitoring and getting
news stories, rporting interviewing subjects in front of a video camera,
submission of news and current events reports pertaining to the Philippines, and
traveling to the regional office in Thailand.” She also had to report for work in
Fuji’s office in Manila from Mondays to Fridays, eight per day. She had no
equipment and had to use the facilities of Fuji to accomplish her tasks.

The successive renewals of her contract indicated the necessity and desirability of
her work in the usual course of Fuji’s business. Because of this, Arlene had
become a regular employee with the right to security of tenure.
Arlene’s contract indicating a fixed term did not automatically mean that she
could never be a regular employee. For as long as it was the employee who
requested, or bargained, that the contract have a “definite date of termination,”
or that the fixed-term contract be freely entered into by the employer and the
employee, then the validity of the fixed-term contract will be upheld.

3. Arlene was illegally dismissed.

As a regular employee, Arlene was entitled to security of tenure under Article

279 of the Labor Code and could be dismissed only for just or authorized causaes
and after observance of due process.

The expiration of the contract does not negate the finding of illegal dismissal. The
manner by which Fuji informed Arlene of non-renewal through email a month
after she informed Fuji of her illness is tantamount to constructive dismissal.
Further, Arlene was asked to sign a letter of resignation prepared by Fuji. The
existence of a fixed-term contract should not mean that there can be no illegal
dismissal. Due process must still be observed.

Moreoever, disease as a ground for termination under Article 284 of the Labor
Code and Book VI, Rule 1, Section 8 of the Omnibus Rules Implementing the
Labor Code require two requirements to be complied with: (1) the employee’s
disease cannot be cured within six months and his continued employment is
prohibited by law or prejudicial to his health as well as to the health of his co-
employees; and (2) certification issued by a competent public health authority
that even with proper medical treatment, the disease cannot be cured within six
months. The burden of proving compliance with these requisites is on the
employer. Non-compliance leads to illegal dismissal. blesvirtualLawlibrary

Arlene was not accorded due process. After informing her employer of her lung
cancer, she was not given the chance to present medical certificates. Fuji
immediately concluded that Arlene could no longer perform her duties because
of chemotherapy. Neither did it suggest for her to take a leave. It did not present
any certificate from a competent public health authority.

Therefore, Arlene was illegally dismissed.

4. The Court of Appeals correctly awarded reinstatement, damages and attorney’s

fees.
The Court of Appeals awarded moral and exemplary damages and attorney’s
fees. It also ordered reinstatement, as the grounds when separation pay was
awarded in lieu of reinstatement were not proven.

The Labor Code provides in Article 279 that illegally dismissed employees are
entitled to reinstatement, backwages including allowances, and all other benefits.

Separation pay in lieu of reinstatement is allowed only (1) when the employer
has ceased operations; (2) when the employee’s position is no longer available;
(3) strained relations; and (4) a substantial period has lapsed from date of filing
to date of finality.

The doctrine of strained relations should be strictly applied to avoid deprivation

of the right to reinstatement. In the case at bar, no evidence was presented by
Fuji to prove that reinstatement was no longer feasible. Fuji did not allege that it
ceased operations or that Arlene’s position was no longer feasible. Nothing
showed that the reinstatement would cause an atmosphere of antagonism in the
workplace.

Moral damages are awarded “when the dismissal is attended by bad faith or
fraud or constitutes an act oppressive to labor, or is done in a manner contrary to
good morals, good customs or public policy.” On the other hand, exemplary
damages may be awarded when the dismissal was effected “in a wanton,
oppressive or malevolent manner.

After Arlene had informed Fuji of her cancer, she was informed that there would
be problems in renewing her contract on account of her condition. This
information caused Arlene mental anguish, serious anxiety, and wounded
feelings. The manner of her dismissal was effected in an oppressive approach
with her salary and other benefits being withheld until May 5, 2009, when she
had no other choice but to sign the non-renewal contract.

With regard to the award of attorney’s fees, Article 111 of the Labor Code states
that “[i]n cases of unlawful withholding of wages, the culpable party may be
assessed attorney’s fees equivalent to ten percent of the amount of wages
recovered.” In actions for recovery of wages or where an employee was forced to
litigate and, thus, incur expenses to protect his rights and interest, the award of
attorney’s fees is legally and morally justifiablen.” Due to her illegal dismissal,
Arlene was forced to litigate.
Therefore, the awards for reinstatement, damages and attorney’s fees were
proper.

Since the 30-day notice is for the employer’s benefit, he may

waive such period. Thus, in Paredes vs. Feed the Children
Philippines, Inc. (G.R. No. 184397, 9 September 2015), the
Supreme Court elucidated that the rule requiring an employee
to stay or complete the 30-day period prior to the effectivity of
his resignation becomes discretionary on the part of
management as an employee who intends to resign may be
allowed a shorter period before his resignation becomes
effective. Hence, as part of management prerogative, an
employer has the right to move the effectivity date to an earlier
date.

JMM PROMOTION AND MANAGEMENT, INC., and

KARY INTERNATIONAL INC., petitioner, v.
HONORABLE COURT OF APPEALS, HON. MA.
NIEVES CONFESSOR, then Secretary of the
Department of Labor and Employment,
HON. JOSE BRILLANTES, in his capacity
as acting Secretary of the Department
of Labor and Employment and HON.
FELICISIMO JOSON, in his capacity as
Administrator of the Philippine
Overseas Employment Administration,
respondents.
G.R. No. 120095. August 5, 1996
KAPUNAN, J.:

FACTS:
The Federation of Entertainment Talent Managers of the
Philippines (FETMOP for brevity) filed a class suit on January
27, 1995 assailing that the Department Order No. 3 which
establishes various procedures and requirements for screening
performing artists under a new system of training, testing,
certification and deployment of the former and other
related issuance, principally contending that the said orders,
1.)violated the constitutional right to travel; 2.) abridged
existing contracts for employment; and 3.) deprived individual
artists of their licenses without due process of law. FETMOP
also averred that the issuance of the Artist Record Book (ARB)
was discriminatory and illegal and in gross violation of the
constitutional right to life liberty and property. FETMOP
prayed for the issuance of the writ of preliminary injunction
against the orders.

JMM Promotion and Management, Inc. (JMM for brevity) and Kary
International, Inc. (Kary for brevity) filed a motion for
intervention in the civil case which was granted by the trial
court on February 15, 1995. However, on February 21, 1995, the
trial court issued an order denying petitioner's prayer for
writ of preliminary injunction and dismissed the compliant. An
appeal was made to the trial court regarding its decision but
it was also however, dismissed. As a consequences, ARB
requirement was issed. The Court of Appeals upheld the trial
court's decision and concluded that the
said issuance constituted a valid exercise of Police power.

ISSUE:
Whether or not the the said issuance is a valid exercise of
Police Power.

RULING:
Yes, the ARB requirement and questioned Department Order
related to its issuance were issued by the Secretary of
Labor pursuant to a valid exercise of Police Power by the
State. The proper regulation of a profession, calling,
business or trade has always been upheld as a legitimate
subject of a valid exercise of police power by the state
particularly when their conduct afffects either the execution
of a legitimate governmental functions, the preservation of
the State, the public health and welfare and public morals.
According to the maxim sic utere tuo ut alienum non
laedas (use your property in such a fashion so as to not
disturb others) it must of course be within the legitimate
range of legislative action to define the mode and manner in
which every one may so use his own property so as not to pose
injury to himself or others.

In any case, where the liberty curtailed affects at most the

right of property, the permissible scope of regulatory
measures is certainly much wider. To pretend that licensing or
accreditation requirements violates due process clause is to
ignore the settled practice, under the mantle of the police
power, of regulating entry to the practice of various trades
or profession. Professional leaving for abroad are required to
pass rigid written and practical exams before they are deemed
fit to practice their trade. It is not claimed that these
requirements pose an unwarranted deprivation of a property
right under the due process clause. So long as professionals
and other workers meet reasonable regulatory standards no
such deprivation exists.