B. The Labor Code of the Philippines. Same; Same; Same.
Same; Same; Same.—Interpretative regulations and those merely internal in nature, that is,
4. Rules and Regulations
No. L-63915. December 29, 1986
LORENZO M. TAÑADA, ABRAHAM F. SARMIENTO, and MOVEMENT OF ATTORNEYS
FOR BROTHERHOOD, INTEGRITY AND NATIONALISM, INC. (MABINI), petitioners, vs.
HON. JUAN C. TUVERA, in his capacity as Executive Assistant to the President, HON.
JOAQUIN VENUS, in his capacity as Deputy Executive Assistant to the President,
MELQUIADES P. DE LA CRUZ, ETC., ET AL., respondents.
Statutes; Words and Phrases; The clause "unless it is otherwise provided" in Art 2 of the NCC
refers to the effectivity of laws and not to the requirement of publication.—After a careful study of this
provision and of the arguments of the parties, both on the original petition and on the instant motion, we
have come to the conclusion, and so hold, that the clause "unless it is otherwise provided" refers to the
date of effectivity and not to the requirement of publication itself, which cannot in any event be omitted.
This clause does not mean that the legislature may make the law effective immediately upon approval,
or on any other date, without its previous publication.
Same; Same; The prior publication of laws before they become effective cannot be dispensed
with.—lt is not correct to say that under the disputed clause publication may be dispensed with
altogether. The reason is that such omission would offend due process insofar as it would deny the
public knowledge of the laws that are supposed to govern it. Surely, if the legislature could validly
provide that a law shall become effective immediately upon its approval notwithstanding the lack of
publication (or after an unreasonably short period after publication), it is not unlikely that persons not
aware of it would be prejudiced as a result; and they would be so not because of a failure to comply
with it but simply because they did not know of its existence. Significantly, this is not true only of penal
laws as is commonly supposed. One can think of many non-penal measures, like a law on prescription,
which must also be communicated to the persons they may affect before they can begin to operate.
Same; Same; For purposes of the prior publication requirement for effectivity, the term "laws" refer
not only to those of general application, but also to laws of local application, private laws; administrative
rules enforcing a statute; city charters. Central Bank circulars to "fill-in the details of the Central Bank
Act; but not mere interpretative rules regulating and providing guidelines for purposes of internal
operations only.—The term "laws" should refer to all laws and not only to those of general application,
for strictly speaking all laws relate to the people in general albeit there are some that do not apply to
them directly. An example is a law granting citizenship to a particular individual, like a relative of
President Marcos who was decreed instant naturalization. It surely cannot be said that such a law does
not affect the public although it unquestionably does not apply directly to all the people. The subject of
such law is a matter of public interest which any member of the body politic may question in the political
forums or, if he is a proper party, even in the courts of justice. In fact, a law without any bearing on the
public would be invalid as an intrusion of privacy or as class legislation or as an ultra vires act of the
legislature. To be valid, the law must invariably affect the public interest even if it might be directly
applicable only to one individual, or some of the people only, and not to the public as a whole.
Same; Same; Same.—We hold therefore that all statutes, including those of local application and
private laws, shall be published as a condition for their effectivity, which shall begin fifteen days after
publication unless a different effectivity date is fixed by the legislature.
Same; Same; Same.—Covered by this rule are presidential decrees and executive orders
promulgated by the President in the exercise of legislative powers whenever the same are validly
delegated by the legislature or, at present, directly conferred by the Constitution. Administrative rules
and regulations must also be published if their purpose is to enforce or implement existing law pursuant
also to a valid delegation.
regulating only the personnel of the administrative agency and not the public, need not be published.
Neither is publication required of the so-called letters of instructions issued by administrative superiors
concerning the rules or guidelines to be followed by their subordinates in the performance of their
duties.
Same; Same; Same.—Accordingly, even the charter of a city must be published notwithstanding
that it applies to only a portion of the national territory and directy affects only the inhabitants of that
place. All presidential decrees must be published, including even, say, those naming a public place
after a favored individual or exempting him from certain prohibitions or requirements. The circulars
issued by the Monetary Board must be published if they are meant not merely to interpret but to "fill in
the details" of the Central Bank Act which that body is supposed to enforce.
Same; Same; Local Governments; Internal instructions issued by an administrative agency are
not covered by the rule on prior publication. Also not covered are municipal ordinances which are
governed by the Local Government Code.—However, no publication is required of the instructions
issued by, say, the Minister of Social Welfare on the case studies to be made in petitions for adoption
or the rules laid down by the head of a government agency on the assignments or workload of his
personnel or the wearing of office uniforms. Parenthetically, municipal ordinances are not covered by
this rule but by the Local Government Code.
Same; Same; Publication of statutes must be in full or it is no publication at all.—We agree that
the publication must be in full or it is no publication at all since its purpose is to inform the public of the
contents of the laws. As correctly pointed out by the petitioners, the mere mention of the number of the
presidential decree, the title of such decree, its whereabouts (e.g., "with Secretary Tuvera"), the
supposed date of effectivity, and in a mere supplement of the Official Gazette cannot satisfy the
publication requirement. This is not even substantial compliance. This was the manner, incidentally, in
which the General Appropriations Act for FY 1975, a presidential decree undeniably of general
applicability and interest, was "published" by the Marcos administration. The evident purpose was to
withhold rather than disclose information on this vital law.
Same; Same; Prior publication of statutes for purposes of effectivity must be made in full in the
Official Gazette and not elsewhere.—At any rate, this Court is not called upon to rule upon the wisdom
of a law or to repeal or modify it if we find it impractical. That is not our function. That function belongs
to the legislature. Our task is merely to interpret and apply the law as conceived and approved by the
political departments of the government in accordance with the prescribed procedure. Consequently,
we have no choice but to pronounce that under Article 2 of the Civil Code, the publication of laws must
be made in the Official Gazette, and not elsewhere, as a requirement for their effectivity after fifteen
days from such publication or after a different period provided by the legislature.
Same; Same; Laws must be published as soon as possible.—We also hold that the publication
must be made forthwith, or at least as soon as possible, to give effect to the law pursuant to the said
Article 2. There is that possibility, of course, although not suggested by the parties that a law could be
rendered unenforceable by a mere refusal of the executive, for whatever reason, to cause its
publication as required. This is a matter, however, that we do not need to examine at this time.
RESOLUTION
CRUZ, J.:
Due process was invoked by the petitioners in demanding the disclosure of a number
of presidential decrees which they claimed had not been published as required by law. The
government argued that while publication was necessary as a rule, it was not so when it
was "otherwise provided," as when the decrees themselves declared that they were to
become effective immediately upon their approval. In the decision of this case on April 24,
1985, the Court affirmed the necessity for the publication of some of these decrees,
declaring in the dispositive portion as follows:
"WHEREFORE the Court hereby orders respondents to publish in the Official Gazette
all unpublished presidential issuances which are of general application, and unless so
published, they shall have no binding force and effect.''
The petitioners are now before us again, this time to move for reconsideration/clarification of
that decision. Specifically, they ask the following questions:
1. What is meant by '' law of public nature'' or " general applicability"?
2. Must a distinction be made between laws of general applicability and laws which are
not?
3. What is meant by "publication"?
4. Where is the publication to be made?
5. When is the publication to be made?
Resolving their own doubts, the petitioners suggest that there should be no distinction
between laws of general applicability and those which are not; that publication means
complete publication; and that the publication must be made forthwith in the Official
Gazette.
In the Comment required of the then Solicitor General, he claimed first that the motion
was a request for an advisory opinion and should therefore be dismissed, and, on the
merits, that the clause "unless it is otherwise provided" in Article 2 of the Civil Code meant
that the publication required therein was not always imperative; that publication, when
necessary, did not have to be made in the Official Gazette; and that in any case the subject
decision was concurred in only by three justices and consequently not binding. This elicited
a Reply refuting these arguments. Came next the February Revolution and the Court
required the new Solicitor General to file a Rejoinder in view of the supervening events,
under Rule 3, Section 18, of the Rules of Court. Responding, he submitted that issuances
intended only for the internal administration of a government agency or f or particular
persons did not have to be published; that publication when necessary must be in full and in
the Official Gazette; and that, however, the decision under reconsideration was not binding
because it was not supported by eight members of this Court.
The subject of contention is Article 2 of the Civil Code providing as follows:
"ART. 2. Laws shall take effect after fifteen days following the completion of their
publication in the Official Gazette, unless it is otherwise provided. This Code shall take
effect one year after such publication."
After a careful study of this provision and of the arguments of the parties, both on the
original petition and on the instant motion, we have come to the conclusion, and so hold,
that the clause "unless it is otherwise provided" refers to the date of effectivity and not to the
requirement of publication itself, which cannot in any event be omitted. This clause does not
mean that the legislature may make the law effective immediately upon approval, or on any
other date, without its previous publication.
Publication is indispensable in every case, but the legislature may in its discretion
provide that the usual fifteenday period shall be shortened or extended. An example, as
pointed out by the present Chief Justice in his separate concurrence in the original decision,
is the Civil Code which did not become effective after fifteen days from its publication in the
Official Gazette but "one year after such publication." The general rule did not apply
because it was "otherwise provided."
It is not correct to say that under the disputed clause publication may be dispensed with
altogether. The reason is that such omission would offend due process insofar as it would
deny the public knowledge of the laws that are supposed to govern it. Surely, if the
legislature could validly provide that a law shall become effective immediately upon its
approval notwithstanding the lack of publication (or after an unreasonably short period after
publication), it is not unlikely that persons not aware of it would be prejudiced as a result;
and they would be so not because of a failure to comply with it but simply because they did
not know of its existence. Significantly, this is not true only of penal laws as is commonly
supposed. One can think of many non-penal measures, like a law on prescription, which
must also be communicated to the persons they may af fect bef ore they can begin to
operate.
We note at this point the conclusive presumption that every person knows the law,
which of course presupposes that the law has been published if the presumption is to have
any legal justification at all. It is no less important to remember that Section 6 of the Bill of
Rights recognizes "the right of the people to information on matters of public concern," and
this certainly applies to, among others, and indeed especially, the legislative enactments of
the government.
The term "laws" should refer to all laws and not only to those of general application, for
strictly speaking all laws relate to the people in general albeit there are some that do not
apply to them directly. An example is a law granting citizenship to a particular individual, like
a relative of President Marcos who was decreed instant naturalization. It surely cannot be
said that such a law does not affect the public although it unquestionably does not apply
directly to all the people. The subject of such law is a matter of public interest which any
member of the body politic may question in the political forums or, if he is a proper party,
even in the courts of justice. In fact, a law without any bearing on the public would be invalid
as an intrusion of privacy or as class legislation or as an ultra vires act of the legislature. To
be valid, the law must invariably affect the public interest even if it might be directly
applicable only to one individual, or some of the people only, and not to the public as a
whole.
We hold therefore that all statutes, including those of local application and private laws,
shall be published as a condition for their effectivity, which shall begin fifteen days after
publication unless a different effectivity date is fixed by the legislature.
Covered by this rule are presidential decrees and executive orders promulgated by the
President in the exercise of legislative powers whenever the same are validly delegated by
the legislature or, at present, directly conferred by the Constitution. Administrative rules and
regulations must also be published if their purpose is to enforce or implement existing law
pursuant also to a valid delegation.
Interpretative regulations and those merely internal in nature, that is, regulating only the
personnel of the administrative agency and not the public, need not be published. Neither is
publication required of the so-called letters of instructions issued by administrative superiors
concerning the rules or guidelines to be followed by their subordinates in the performance of
their duties.
 Accordingly, even the charter of a city must be published notwithstanding that it applies
to only a portion of the national territory and directly affects only the inhabitants of that
place. All presidential decrees must be published, including even, say, those naming a
public place after a favored individual or exempting him from certain prohibitions or
requirements, The circulars issued by the Monetary Board must be published if they are
meant not merely to interpret but to "fill in the details" of the Central Bank Act which that
body is supposed to enforce.
We also hold that the publication must be made forthwith, or at least as soon as
possible, to give effect to the law pursuant to the said Article 2. There is that possibility, of
course, although not suggested by the parties that a law could be rendered unenforceable
by a mere refusal of the executive, for whatever reason, to cause its publication as required.
This is a matter, however, that we do not need to examine at this time. Finally, the claim of
the former Solicitor General that the instant motion is a request for an advisory opinion is
untenable, to say the least, and deserves no further comment.

However, no publication is required of the instructions issued by, say, the Minister of
Social Welfare on the case studies to be made in petitions for adoption or the rules laid
down by the head of a government agency on the assignments or workload of his personnel
or the wearing of office uniforms. Parenthetically, municipal ordinances are not covered by
this rule but by the Local Government Code.
We agree that the publication must be in full or it is no publication at all since its
purpose is to inf orm the public of the contents of the laws, As correctly pointed out by the
petitioners, the mere mention of the number of the presidential decree, the title of such
decree, its whereabouts (e.g., "with Secretary Tuvera"), the supposed date of effectivity,
and in a mere supplement of the Official Gazette cannot satisfy the publication requirement.
This is not even substantial compliance. This was the manner, incidentally, in which the
General Appropriations Act for FY 1975, a presidential decree undeniably of general
applicability and interest, was "published" by the Marcos administration. The evident
purpose was to withhold rather than disclose information on this vital law.
Coming now to the original decision, it is true that only four justices were categorically
for publication in the Official Gazette and that six others felt that publication could be made
elsewhere as long as the people were sufficiently informed. One reserved his vote and
another merely acknowledged the need for due publication without indicating where it
should be made. It is therefore necessary for the present membership of this Court to arrive
at a clear consensus on this matter and to lay down a binding decision supported by the
necessary vote.
There is much to be said of the view that the publication need not be made in the
Official Gazette, considering its erratic releases and limited readership. Undoubtedly,
newspapers of general circulation could better perform the function of communicating the
laws to the people as such periodicals are more easily available, have a wider readership,
and come out regularly. The trouble, though, is that this kind of publication is not the one
required or authorized by existing law. As far as we know, no amendment has been made
of Article 2 of the Civil Code. The Solicitor General has not pointed to such a law, and we
have no information that it exists. If it does, it obviously has not yet been published.
The days of the secret laws and the unpublished decrees are over. This is once again
an open society, with all the acts of the government subject to public scrutiny and available
always to public cognizance. This has to be so if our country is to remain democratic, with
sovereignty residing in the people and all government authority emanating from them.
Although they have delegated the power of legislation, they retain the authority to
review the work of their delegates and to ratify or reject it according to their lights, through
their freedom of expression and their right of suffrage. This they cannot do if the acts of the
legislature are concealed.
Laws must come out in the open in the clear light of the sun instead of skulking in the
shadows with their dark, deep secrets. Mysterious pronouncements and rumored rules
cannot be recognized as binding unless their existence and contents are confirmed by a
valid publication intended to make full disclosure and give proper notice to the people. The
furtive law is like a scabbarded saber that cannot feint, parry or cut unless the naked blade
is drawn.
WHEREFORE, it is hereby declared that all laws as above defined shall immediately
upon their approval, or as soon thereafter as possible, be published in full in the Official
Gazette, to become effective only after fifteen days from their publication, or on another
date specified by the legislature, in accordance with Article 2 of the Civil Code.
SO ORDERED.
——o0o——

At any rate, this Court is not called upon to rule upon the wisdom of a law or to repeal
or modify it if we find it impractical. That is not our function. That function belongs to the
legislature. Our task is merely to interpret and apply the law as conceived and approved by
the political departments of the government in accordance with the prescribed procedure.
Consequently, we have no choice but to pronounce that under Article 2 of the Civil Code,
the publication of laws must be made in the Official Gazette, and not elsewhere, as a
requirement for their effectivity after fifteen days from such publication or after a different
period provided by the legislature.
 G.R. No. 190809. February 13, 2017.
DE LA SALLE-ARANETA UNIVERSITY, petitioner, vs. JUANITO C. BERNARDO,
respondent.
Labor Law; Probationary Employees; Teachers; Jurisprudence identified the requisites which
should concur for a private school teacher to acquire permanent status, viz.: (1) the teacher is a full-
time teacher; (2) the teacher must have rendered three (3) consecutive years of service; and (3) such
service must have been satisfactory.—There is no dispute that Bernardo was a part-time lecturer at
DLS-AU, with a fixed-term employment. As a part-time lecturer, Bernardo did not attain permanent
status. Section 93 of the 1992 Manual of Regulations for Private Schools provided: Sec. 93. Regular or
Permanent Status.—Those who have served the probationary period shall be made regular or
permanent. Full-time teachers who have satisfactorily completed their probationary period shall be
considered regular or permanent. Per Section 92 of the same Regulations, probationary period for
academic personnel “shall not be more than three (3) consecutive years of satisfactory service for
those in the elementary and secondary levels, six (6) consecutive regular semesters of satisfactory
service for those in the tertiary level, and nine (9) consecutive trimesters of satisfactory service for
those in the tertiary level where collegiate courses are offered on the trimester basis.” Thus,
jurisprudence identified the requisites which should concur for a private school teacher to acquire
permanent status, viz.: (1) the teacher is a full-time teacher; (2) the teacher must have rendered three
consecutive years of service; and (3) such service must have been satisfactory.
 
Same; Same; Retirement Benefits; Republic Act (RA) No. 7641 is a curative social legislation. It
precisely intends to give the minimum retirement benefits to employees not entitled to the same under
collective bargaining and other agreements. It also applies to establishments with existing collective
bargaining or other agreements or voluntary retirement plans whose benefits are less than those
prescribed in said law.—The Court declared in Aquino v. National Labor Relations Commission, 206
SCRA 118 (1992), that retirement benefits are intended to help the employee enjoy the remaining
years of his life, lessening the burden of worrying for his financial support, and are a form of reward for
his loyalty and service to the employer. Retirement benefits, where not mandated by law, may be
granted by agreement of the employees and their employer or as a voluntary act on the part of the
employer. In the present case, DLS-AU, through Dr. Bautista, denied Bernardo’s claim for retirement
benefits because only full-time permanent faculty of DLS-AU are entitled to said benefits pursuant to
university policy and the CBA. Since Bernardo has not been granted retirement benefits under any
agreement with or by voluntary act of DLS-AU, the next question then is, can Bernardo claim retirement
benefits by mandate of any law? We answer in the affirmative. Republic Act No. 7641 is a curative
social legislation. It precisely intends to give the minimum retirement benefits to employees not entitled
to the same under collective bargaining and other agreements. It also applies to establishments with
existing collective bargaining or other agreements or voluntary retirement plans whose benefits are less
than those prescribed in said law.
Same; Same; Same; The Implementing Rules provide that Republic Act (RA) No. 7641 applies to
“all employees in the private sector, regardless of their position, designation or status and irrespective
of the method by which their wages are paid, except to those specifically exempted x x x”; The only
exemptions specifically identified by RA No. 7641 and its Implementing Rules are: (1) employees of the
National Government and its political subdivisions, including government-owned and/or -controlled
corporations, if they are covered by the Civil Service Law and its regulations; and (2) employees of
retail, service and agricultural establishments or operations regularly employing not more than ten (10)
employees.—Republic Act No. 7641 states that “any employee may be retired upon reaching the
retirement age x x x”; and “[i]n case of retirement, the employee shall be entitled to receive such
retirement benefits as he may have earned under existing laws and any collective bargaining
agreement and other agreements.” The Implementing Rules provide that Republic Act No. 7641 applies
to “all employees in the private sector, regardless of their position, designation or status and
irrespective of the method by which their wages are paid, except to those specifically exempted x x x.”
And Secretary Quisumbing’s Labor Advisory further clarifies that the employees covered by Republic
Act No. 7641 shall “include part-time employees, employees of service and other job contractors and
domestic helpers or persons in the personal service of another.” The only exemptions specifically
identified by Republic Act No. 7641 and its Implementing Rules are: (1) employees of the National
Government and its political subdivisions, including government-owned and/or -controlled corporations,
if they are covered by the Civil Service Law and its regulations; and (2) employees of retail, service and
agricultural establishments or operations regularly employing not more than 10 employees.
Same; Same; Same; Part-time Employees; The general coverage of Republic Act (RA) No. 7641
is broad enough to encompass all private sector employees, and part-time employees are not among
those specifically exempted from the law.—Based on Republic Act No. 7641, its Implementing Rules,
and Secretary Quisumbing’s Labor Advisory, Bernardo, as a part-time employee of DLS-AU, is entitled
to retirement benefits. The general coverage of Republic Act No. 7641 is broad enough to encompass
all private sector employees, and part-time employees are not among those specifically exempted from
the law. The provisions of Republic Act No. 7641 and its Implementing Rules are plain, direct,
unambiguous, and need no further elucidation. Any doubt is dispelled by the unequivocal statement in
Secretary Quisumbing’s Labor Advisory that Republic Act No. 7641 applies to even part-time
employees. Under the rule of statutory construction of expressio unius est exclusio alterius, Bernardo’s
claim for retirement benefits cannot be denied on the ground that he was a part-time employee as part-
time employees are not among those specifically exempted under Republic Act No. 7641 or its
Implementing Rules.
Implementing Rules; The Implementing Rules partake the nature of a statute and are binding as if
written in the law itself. They have the force and effect of law and enjoy the presumption of
constitutionality and legality until they are set aside with finality in an appropriate case by a competent
court.—In ruling that Bernardo, as part-time employee, is entitled to retirement benefits, we do no less
and no more than apply Republic Act No. 7641 and its Implementing Rules issued by the DOLE under
the authority given to it by the Congress. Needless to stress, the Implementing Rules partake the
nature of a statute and are binding as if written in the law itself. They have the force and effect of law
and enjoy the presumption of constitutionality and legality until they are set aside with finality in an
appropriate case by a competent court.
Advisory Opinions; In administrative law, contemporaneous and practical interpretation of law by
administrative officials charged with its administration and enforcement carries great weight and should
be respected, unless contrary to law or manifestly erroneous.—As a matter of contemporaneous
interpretation of law, Secretary Quisumbing’s Labor Advisory has persuasive effect. It is undisputed that
in administrative law, contemporaneous and practical interpretation of law by administrative officials
charged with its administration and enforcement carries great weight and should be respected, unless
contrary to law or manifestly erroneous.
Labor Law; Retirement Benefits; For the availment of the retirement benefits under Article 302
[287] of the Labor Code, as amended by Republic Act (RA) No. 7641, the following requisites must
concur: (1) the employee has reached the age of sixty (60) years for optional retirement or sixty-five
(65) years for compulsory retirement; (2) the employee has served at least five (5) years in the
establishment; and (3) there is no retirement plan or other applicable agreement providing for
retirement benefits of employees in the establishment.—For the availment of the retirement benefits
under Article 302 [287] of the Labor Code, as amended by Republic Act No. 7641, the following
requisites must concur: (1) the employee has reached the age of 60 years for optional retirement or 65
years for compulsory retirement; (2) the employee has served at least five years in the establishment;
and (3) there is no retirement plan or other applicable agreement providing for retirement benefits of
employees in the establishment. Bernardo — being 75 years old at the time of his retirement, having
served DLS-AU for a total of 27 years, and not being covered by the grant of retirement benefits in the
CBA — is unquestionably qualified to avail himself of retirement benefits under said statutory provision,
i.e., equivalent to one-half month salary for every year of service, a fraction of at least six months being
considered as one whole year.
Remedial Law; Civil Procedure; Cause of Action; Retirement Benefits; The cause of action for
Bernardo’s retirement benefits only accrued after the refusal of De La Salle-Araneta University (DLS-
AU) to pay him the same, clearly expressed in Dr. Bautista’s letter dated February 12, 2004.—A cause time permanent faculty of DLS-AU for at least five years immediately preceeding the
of action has three elements, to wit, (1) a right in favor of the plaintiff by whatever means and under termination of their employment could avail themselves of the postemployment benefits. As
whatever law it arises or is created; (2) an obligation on the part of the named defendant to respect or part-time faculty member, Bernardo did not acquire permanent employment under the
not to violate such right; and (3) an act or omission on the part of such defendant violative of the right of
Manual of Regulations for Private Schools, in relation to the Labor Code, regardless of his
the plaintiff or constituting a breach of the obligation of the defendant to the plaintiff. Bernardo’s right to
retirement benefits and the obligation of DLS-AU to pay such benefits are already established under length of service.
Article 302 [287] of the Labor Code, as amended by Republic Act No. 7641. However, there was a
violation of Bernardo’s right only after DLS-AU informed him on November 8, 2003 that the university Aggrieved by the repeated denials of his claim for retirement benefits, Bernardo filed
no longer intended to offer him another contract of employment, and already accepting his separation before the NLRC, National Capital Region, a complaint for non-payment of retirement
from service, Bernardo sought his retirement benefits, but was denied by DLS-AU. Therefore, the benefits and damages against DLS-AU and Dr. Bautista.
cause of action for Bernardo’s retirement benefits only accrued after the refusal of DLS-AU to pay him
the same, clearly expressed in Dr. Bautista’s letter dated February 12, 2004. Hence, Bernardo’s DLS-AU and Dr. Bautista averred that DLS-AU is a non-stock, non-profit educational
complaint, filed with the NLRC on February 26, 2004, was filed within the three-year prescriptive period
institution duly organized under Philippine laws, and Dr. Bautista was then its Executive
provided under Article 291 of the Labor Code.
Vice-President. DLS-AU and Dr. Bautista countered that Bernardo was hired as a part-time
lecturer at the Graduate School of DLS-AU to teach Recent Advances in Animal Nutrition
for the first semester of school year 2003-2004. As stated in the Contract for Part-Time
Faculty Member Semestral, Bernardo bound himself to teach "for the period of one
LEONARDO-DE CASTRO, J.:
semester beginning June 9, 2003 to October 12, 2003." The contract also provided that
Before Us is a Petition for Review on Certiorari under Rule 45 of the Rules of Court
"this Contract shall automatically expire unless expressly renewed in writing." Prior
filed by De La Salle-Araneta University (DLS-AU) seeking the annulment and reversal of the
contracts entered into between Bernardo and DLS-AU essentially contained the same
Decision dated June 29, 2009 and Resolution dated January 4, 2010 of the Court of
provisions. On November 8, 2003, DLS-AU informed Bernardo that his contract would no
Appeals in CA-G.R. SP No. 106399, which affirmed in toto  the Decision of the National
longer be renewed. DLS-AU and Dr. Bautista were surprised when they received a letter
Labor Relations Commission (NLRC) in NLRC NCR CA No. 043416-05. The NLRC
from Bernardo on February 18, 2004 claiming retirement benefits and Summons dated
reversed and set aside the Labor Arbiter's Decision dated December 13, 2004 in NLRC
February 26, 2004 from the NLRC in relation to Bernardo's complaint.
NCR Case No. 00-02-02729-04 and found that respondent Juanito C. Bernardo (Bernardo)
was entitled to retirement benefits.
DLS-AU and Dr. Bautista maintained that Bernardo, as a part-time employee, was not
entitled to retirement benefits. The contract between DLS-AU and Bernardo was for a fixed
On February 26, 2004, Bernardo filed a complaint against DLS-AU and its
term, i.e.,  one semester. Contracts of employment for a fixed term are not proscribed by
owner/manager, Dr. Oscar Bautista (Dr. Bautista), for the payment of retirement benefits.
law, provided that they had been entered into by the parties without any force, duress, or
Bernardo alleged that he started working as a part-time professional lecturer at DLS-AU
improper pressure being brought to bear upon the employee and absent any other
(formerly known as the Araneta University Foundation) on June 1, 1974 for an hourly rate of
circumstance vitiating consent. That DLS-AU no longer renewed Bernardo's contract did not
₱20.00. Bernardo taught for two semesters and the summer for the school year 1974-1975.
necessarily mean that Bernardo should be deemed retired from service.
Bernardo then took a leave of absence from June 1, 197 5 to October 31, 1977 when he
was assigned by the Philippine Government to work in Papua New Guinea. When Bernardo
DLS-AU and Dr. Bautista also contended that Bernardo, as a part-time employee, was
came back in 1977, he resumed teaching at DLS-AU until October '12, 2003, the end of the
not entitled to retirement benefits pursuant to any retirement plan, CBA, or employment
first semester for school year 2003-2004. Bernardo's teaching contract was renewed at the
contract. Neither was DLS-AU mandated by law to pay Bernardo retirement benefits. The
start of every semester and summer. However, on November 8, 2003, DLS-AU informed
compulsory retirement age under Article 302 [287] of the Labor Code, as amended, is 65
Bernardo through a telephone call that he could not teach at the school anymore as the
years old. When the employee reaches said age, his/her employment is deemed
school was implementing the retirement age limit for its faculty members. As he was already
terminated. The matter of extension of the employee's service is addressed to the sound
75 years old, Bernardo had no choice but to retire. At the time of his retirement, Bernardo
discretion of the employer; it is a privilege only the employer can grant. In this case,
was being paid ₱246.50 per hour.
Bernardo was effectively separated from the service upon reaching the age of 65 years old.
DLS-AU merely granted Bernardo the privilege to teach by engaging his services for several
Bernardo immediately sought advice from the Department of Labor and Employment
more years after reaching the compulsory retirement age. Assuming arguendo that
(DOLE) regarding his entitlement to retirement benefits after 27 years of employment. In
Bernardo was entitled to retirement benefits, he should have claimed the same upon
letters dated January 20, 2004 and February 3, 2004, the DOLE, through its Public
reaching the age of 65 years old. Under Article 291 of the Labor Code, as amended, all
Assistance Center and Legal Service Office, opined that Bernardo was entitled to receive
money claims arising from employer-employee relations shall be filed within three years
benefits under Republic Act No. 7641, otherwise known as the "New Retirement Law," and
from the time the cause of action accrues.
its Implementing Rules and Regulations.
Still according to DLS-AU and Dr. Bautista, Bernardo had no cause of action against
Yet, Dr. Bautista, in a letter dated February 12, 2004, stated that Bernardo was not
Dr. Bautista because the latter was only acting on behalf of DLS-AU as its Executive Vice-
entitled to any kind of separation pay or benefits. Dr. Bautista explained to Bernardo that as
President. It is a well-settled rule that a corporation is a juridical entity with a legal
mandated by the DLS-AU's policy and Collective Bargaining Agreement (CBA), only full-
personality separate and distinct from the people comprising it and those acting for and on
its behalf. There was no showing that Dr. Bautista acted deliberately or maliciously in
refusing to pay Bernardo his retirement benefits, so as to make Dr. Bautista personally
liable for any corporate obligations of DLS-AU to Bernardo.
Finally, DLS-AU asserted that Bernardo failed to establish the factual and legal bases
for his claims for actual, moral, and exemplary damages, and attorney's fees. There was no
proof of the alleged value of the profits or any other loss suffered by Bernardo because of
the non-payment of his retirement benefits. There was likewise no evidence of bad faith or
fraud on the part of DLS-AU in refusing to grant Bernardo retirement benefits.
On December 13, 2004, the Labor Arbiter rendered its Decision dismissing Bernardo's
complaint on the ground of prescription, thus:
[T]he age of sixty-five (65) is declared as the compulsory retirement age under Article
287 of the Labor Code, as amended. When the compulsory retirement age is reached
by an employee or official, he is thereby effectively separated from the service (UST
Faculty Union v. National Labor Relations Commission, University of Santo
Tomas, G.R. No. 89885, August 6, 1990). As mentioned earlier, [Bernardo] is already
seventy-five (75) years old, and is way past the compulsory retirement age. If he were
indeed entitled to receive his retirement pay/benefits, he should have claimed the same
ten (10) years ago upon reaching the age of sixty-five (65).
In this connection, it would be worthy to mention that the Labor Code contains a
specific provision that deals with money claims arising out of employer-employee
relationships. Article 291 of the Labor Code as amended clearly provides:
"ART 291. MONEY CLAIMS. - All money claims arising from employer-employee
relations accruing during the effectivity of this Code shall be filed within three (3) years
from the time the cause of action accrued; otherwise they shall forever be barred.
xxxx
The prescriptive period referred to in Article 291 of the Labor Code, as amended
applies to all kinds of money claims arising from employer-employee relations including
claims for retirement benefits.
The ruling of the Supreme Court in De Guzman v. Court of Appeals, (G.R. No. 132257,
October 12, 1998), squarely applies to the instant case:
"The language of Article 291 of the Labor Code does not limit its application only to
"money claims specifically recoverable under said Code, " but covers all money claims
arising from employer-employee relations. Since petitioners' demand for unpaid
retirement/separation benefits is a money claim arising from their employment by
private respondent, Article 291 of the Labor Code is applicable. Therefore, petitioners'
claim should be filed within three years from the time their cause of action accrued, or
forever barred by prescription. "
It cannot be denied that the claim for retirement benefits/pay arose out of employer-
employee relations. In line with the decision of the Supreme Court in De Guzman,  it should
be treated as a money claim that must be claimed within three years from the time the
cause of action accrued.
Thus, upon reaching the compulsory retirement age of sixty-five (65), [Bernardo] was
effectively separated from the service. Clearly, such was the time when his cause of action
accrued. He should have sought the payment of such benefits/pay within three (3) years
from such time. It cannot be denied that [Bernardo] belatedly sought the payment of his
retirement benefits/pay considering that he filed the instant Complaint only ten (10) years
after his cause of action accrued. For failure to claim the retirement benefits/pay to which he
claims to be entitled within three (3) years from the time he reached the age of sixty-five
(65), his claim should be forever barred.
The Labor Arbiter decreed:
WHEREFORE, premises considered, judgment is hereby rendered DISMISSING the
instant Complaint on the ground that the claim for retirement benefits/pay is already
barred by prescription.
Bernardo appealed the foregoing Labor Arbiter's Decision to the NLRC, arguing that
since he continuously worked for DLS-AU and Dr. Bautista until October 12, 2003, he was
considered retired and the cause of action for his retirement benefits accrued only on said
date. There was clearly an agreement between Bernardo and DLS-AU that the former
would continue teaching even after reaching the compulsory retirement age of 65 years. In
addition, under Republic Act No. 7641, part-time workers are entitled to retirement pay of
one-half month salary for every years of service, provided that the following conditions are
present: (a) there is no retirement plan between the employer and employees; (b) the
employee has reached the age of 60 years old for optional retirement or 65 years old for
compulsory retirement; and (c) the employee should have rendered at least five years of
service with the employer. Bernardo avowed that all these conditions were extant in his
case.
The NLRC, in its Decision dated June 30, 2008, reversed the Labor Arbiter's ruling and
found that Bernardo timely filed his complaint for retirement benefits. The NLRC pointed out
that DLS-AU and Dr. Bautista, knowing fully well that Bernardo already reached the
compulsory age of retirement of 65 years old, still extended Bernardo's employment. Thus,
Bernardo's cause of action for payment of his retirement benefits accrued only on
November 8, 2003, when he was informed by DLS-AU that his contract would no longer be
renewed and he was deemed separated from employment. The principle of estoppel was
also applicable against DLS-AU and Dr. Bautista who could not validly claim prescription
when they were the ones who permitted Bernardo to work beyond retirement age. As to
Bernardo's entitlement to retirement benefits, the NLRC held:
Equally untenable is the contention that [Bernardo], being a part time employee, is not
entitled to retirement benefits under Republic Act No. 7641. Indeed, a perusal of the
retirement law does not exclude a part time employee from enjoying retirement benefits.
On this score, Republic Act No. 7641 explicitly provides as within its coverage "all
employees in the private sector, regardless of their position, designation, or status, and
irrespective of the method by which their wages are paid" (Section 1, Rules
Implementing the New Retirement Law) (Underlined for emphasis). The only exceptions
are employees covered by the Civil Service Law; domestic helpers and persons in the
personal service of another; and employees in retail, service and agricultural
establishments or operations regularly employing not more than ten employees (ibid).
Clearly, [Bernardo] does not fall under any of the exceptions.
Lastly, it is axiomatic that retirement law should be construed liberally in favor of the
employee, and all doubts as to the intent of the laws should be resolved in favor of the
retiree to achieve its humanitarian purpose (Re: Gregorio G. Pineda, 187 SCRA 469,
1990). A contrary ruling would inevitably defy such settled rule.
In the end, the NLRC adjudged:
 WHEREFORE, judgment is hereby rendered REVERSING and SETTING ASIDE the
appealed decision of the Labor Arbiter. Accordingly, a new one is issued finding
[Bernardo] entitled to retirement benefits under Republic Act No. 7641 and ordering
[DLS-AU and Dr. Bautista] to pay [Bernardo] his retirement benefits equivalent to at
least one-half (1/2) month of his latest salary for every year of his service. Other claims
are hereby denied for lack of merit.
In a Resolution dated September 15, 2008, the NLRC denied the Motion for
Reconsideration of DLS-AU and Dr. Bautista for lack of merit.
DLS-AU filed before the Court of Appeals a Petition for Certiorari and Prohibition,
imputing grave abuse of discretion on the part of the NLRC for (1) holding that Bernardo
was entitled to retirement benefits despite the fact that he was a mere part-time employee;
and (2) not holding that Bernardo's claim for retirement benefits was barred by prescription.
The Court of Appeals promulgated its Decision on June 29, 2009, affirming in toto the
NLRC judgment. The Court of Appeals ruled that the coverage of, as well as the exclusion
from, Republic Act No. 7641 are clearly delineated under Sections 1 and 2 of the
Implementing Rules of Book VI, Rule II of the Labor Code, as well as the Labor Advisory on
Retirement Pay Law; and part-time employees are not among those excluded from enjoying
retirement benefits. Labor and social laws, being remedial in character, should be liberally
construed in order to further their purpose. The appellate court also declared that the NLRC
did not err in relying on the Implementing Rules of Republic Act No. 7641 because
administrative rules and regulations issued by a competent authority remain valid unless
shown to contravene the Constitution or used to enlarge the power of the administrative
agency beyond the scope intended.
The Court of Appeals additionally determined that Bernardo's cause of action accrued
only upon his separation from employment and the subsequent denial of his demand for
retirement benefits. To the appellate court, the NLRC was correct in applying the equitable
doctrine of estoppel since the continuous extension of Bernardo's employment, despite him
being well over the statutory compulsory age of retirement, prevented him from already
claiming his retirement benefits for he was under the impression that he could avail himself
of the same eventually upon the termination of his employment.
The dispositive portion of the Decision of the Court of Appeals reads:
WHEREFORE, the petition is DISMISSED for lack of merit. The assailed Decision of the
National Labor Relations Commission, dated 30 June 2008, is hereby AFFIRMED in
toto. [Bernardo's] application for the issuance of a Temporary Restraining Order and/or
Writ of Preliminary Injunction is accordingly DENIED.
The Motion for Reconsideration of DLS-AU was denied by the Court of Appeals in its
Resolution dated January 4, 2010.
Hence, DLS-AU lodged the present petition before us, raising the following issues:
I but the day certain agreed upon by the parties for the commencement and
WHETHER OR NOT PART-TIME EMPLOYEES ARE EXCLUDED FROM THE
COVERAGE OF THOSE ENTITLED TO RETIREMENT BENEFITS UNDER REPUBLIC
ACT NO. [7641].
II.
WHETHER OR NOT A CLAIM FOR RETIREMENT BENEFITS FILED BEYOND
THE PERIOD PROVIDED FOR UNDER ART. 291 OF THE LABOR CODE HAS
PRESCRIBED.
We find the instant petition bereft of merit.
Bernardo is not questioning the termination of his employment, but only asserting
his right to retirement benefits.
There is no dispute that Bernardo was a part-time lecturer at DLS-AU, with a fixed-term
employment. As a part-time lecturer, Bernardo did not attain permanent status. Section 93
of the 1992 Manual of Regulations for Private Schools provided:
Sec. 93. Regular or Permanent Status. - Those who have served the probationary
period shall be made regular or permanent. Full-time teachers who have satisfactorily
completed their probationary period shall be considered regular or permanent.
Per Section 92 of the same Regulations, probationary period for academic personnel
"shall not be more than three (3) consecutive years of satisfactory service for those in the
elementary and secondary levels, six (6) consecutive regular semesters of satisfactory
service for those in the tertiary level, and nine (9) consecutive trimesters of satisfactory
service for those in the tertiary level where collegiate courses are offered on the trimester
basis."
Thus, jurisprudence identified the requisites which should concur for a private school
teacher to acquire permanent status, viz.: (1) the teacher is a full-time teacher; (2) the
teacher must have rendered three consecutive years of service; and (3) such service must
have been satisfactory.
Considering the foregoing requirements, a part-time employee would not attain
permanent status no matter how long he had served the school. Bernardo did not become a
permanent employee of DLS-AU despite teaching there as a part-time lecturer for a total of
27 years.
Our jurisprudence had likewise settled the legitimacy of fixed-term employment. In the
landmark case of Brent School, Inc. v. Zamora, the Court pronounced:
From the premise - that the duties of an employee entail "activities which are usually
necessary or desirable in the usual business or trade of the employer" - the
conclusion does not necessarily follow that the employer and employee should be
forbidden to stipulate any period of time for the performance of those activities. There
is nothing essentially contradictory between a definite period of an employment
contract and the nature of the employee's duties set down in that contract as being
"usually necessary or desirable in the usual business or trade of the employer." The
concept of the employee's duties as being "usually necessary or desirable in the
usual business or trade of the employer" is not synonymous with or identical to
employment with a fixed term. Logically, the decisive determinant in the term
employment should not be the activities that the employee is called upon to perform,
termination of their employment relationship, a day certain being understood to be
"that which must necessarily come, although it may not be known when." Seasonal
employment, and employment for a particular project are merely instances of
employment in which a period, where not expressly set down, is necessarily implied.
xxxx
 Accordingly, and since the entire purpose behind the development of legislation
culminating in the present Article 280 of the Labor Code clearly appears to have
been, as already observed, to prevent circumvention of the employee's right to be
secure in his tenure, the clause in said article indiscriminately and completely ruling
out all written or oral agreements conflicting with the concept of regular employment
as defined therein should be construed to refer to the substantive evil that the Code
itself has singled out: agreements entered into precisely to circumvent security of
tenure. It should have no application to instances where a fixed period of employment
was agreed upon knowingly and voluntarily 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 where it satisfactorily appears that the
employer and employee dealt with each other on more or less equal terms with no
moral dominance whatever being exercised by the former over the latter. Unless thus
limited in its purview, the law would be made to apply to purposes other than those
explicitly stated by its framers; it thus becomes pointless and arbitrary, unjust in its
effects and apt to lead to absurd and unintended consequences.
Such interpretation puts the seal on [Bibiso v. Victorias Milling Co., Inc.]upon the
effect of the expiry of an agreed period of employment as still good rule - a rule
reaffirmed in the recent case of Escudero v. Office of the President (G.R. No. 57822,
April 26, 1989) where, in the fairly analogous case of a teacher being served by her
school a notice of termination following the expiration of the last of three successive
fixedterm employment contracts, the Court held:
"Reyes' (the teacher's) argument is not persuasive. It loses sight of the fact that
her employment was probationary, contractual in nature, and one with a
definitive period. At the expiration of the period stipulated in the contract, her
appointment was deemed terminated and the letter informing her of the non-
renewal of her contract is not a condition sine qua non before Reyes may be
deemed to have ceased in the employ of petitioner UST. The notice is a mere
reminder that Reyes' contract of employment was due to expire and that the
contract would no longer be renewed. It is not a letter of termination. The
interpretation that the notice is only a reminder is consistent with the court's
finding in Labajo, supra. x xx."
Bernardo's employment with DLS-AU had always been for a fixed-term, i.e., for a
semester or summer. Absent allegation and proof to the contrary, Bernardo entered into
such contracts of employment with DLS-AU knowingly and voluntarily. Hence, Bernardo's
contracts of employment with DLS-AU for a fixed term were valid, legal, and binding.
Bernardo's last contract of employment with DLS-AU ended on October 12, 2003, upon the
close of the first semester for school year 2003-2004, without DLS-AU offering him another
contract for the succeeding semester.
Nonetheless, that Bernardo was a part-time employee and his employment was for a
fixed period are immaterial in this case. Bernardo is not alleging illegal dismissal nor
claiming separation pay. Bernardo is asserting his right to retirement benefits given the
termination of his employment with DLS-AU when he was already 75 years old.
As a part-time employee with fixed-termemployment, Bernardo is entitled to
retirement benefits.
The Court declared in Aquino v. National Labor Relations Commission that retirement
benefits are intended to help the employee enjoy the remaining years of his life, lessening
the burden of worrying for his financial support, and are a form of reward for his loyalty and
service to the employer. Retirement benefits, where not mandated by law, may be granted
by agreement of the employees and their employer or as a voluntary act on the part of the
employer.
In the present case, DLS-AU, through Dr. Bautista, denied Bernardo's claim for
retirement benefits because only full-time permanent faculty of DLS-AU are entitled to said
benefits pursuant to university policy and the CBA. Since Bernardo has not been granted
retirement benefits under any agreement with or by voluntary act of DLS-AU, the next
question then is, can Bernardo claim retirement benefits by mandate of any law?
We answer in the affirmative.
Republic Act No. 7641 is a curative social legislation. It precisely intends to give the
minimum retirement benefits to employees not entitled to the same under collective
bargaining and other agreements. It also applies to establishments with existing collective
bargaining or other agreements or voluntary retirement plans whose benefits are Jess than
those prescribed in said law.
Article 302 [287] of the Labor Code, as amended by Republic Act No. 7641, reads:
Art. 302 [287]. Retirement. -Any employee may be retired upon reaching the
retirement ageestablished in the collective bargaining agreement or other applicable
employment contract.
In case of retirement, the employee shall be entitled to receive such retirement benefits
as he may have earned under existing Jaws and any collective bargaining agreement
and other agreements: Provided however, That an employee's retirement benefits
under any collective bargaining and other agreement shall not be less than those
provided herein.
In the absence of retirement plan or agreement providing for retirement benefits of
employees in the establishment, an employee upon reaching the age of sixty (60) years
or more, but not beyond sixty five (65) years which is hereby declared the compulsory
retirement age, who has served at least five (5) years in said establishment, may retire
and shall be entitled to retirement pay equivalent to at least one-half (1/2) month salary
for every year of service, a fraction of at least six (6) months being considered as one
whole year.
Unless the parties provide for broader inclusions, the term one-half month salary shall
mean fifteen (15) days plus one twelfth (1/12) of the 13th month pay and the cash
equivalent of not more than five (5) days of service incentive leaves.
xxxx
Retail, service and agricultural establishments or operations employing not more
than ten (10) employees or workers are exempted from the coverage of this
provision.
Violation of this provision is hereby declared unlawful and subject to the penal
provisions provided under Article 288 of this Code. (Emphases ours.)
Book VI, Rule II of the Rules Implementing the Labor Code clearly describes the
coverage of Republic Act No. 7641 and specifically identifies the exemptions from the
same, to wit:
Sec. 1. General Statement on Coverage. - This Rule shall apply to all employees in
the private sector, regardless of their position, designation or status and
irrespective of the method by which their wages are paid, except to those
specifically exempted under Section 2 hereof. As used herein, the term "Act" shall
refer to Republic Act No. 7641, which took effect on January 7, 1993.
Section 2. Exemptions. - This Rule shall not apply to the following employees:
 2.1 Employees of the National Government and its political subdivisions,
including Government-owned and/or controlled corporations, if they are covered
by the Civil Service Law and its regulations.
2.2 Domestic helpers and persons in the personal service of another. (Deleted by
Department Order No. 20 issued by Secretary Ma. Nieves R. Confessor on May 31,
1994.)
2.3. Employees of retail, service and agricultural establishments or operations
regularly employing not more than ten (10) employees. As used in this sub-
section:
(a) "Retail establishment" is one principally engaged in the sale of goods to end-users
for personal or household use. It shall lose its retail character qualified for exemption if it
is engaged in both retail and wholesale of goods.
(b) "Service establishment" is one principally engaged in the sale of service to
individuals for their own or household use and is generally recognized as such.
(c) "Agricultural establishment/operation" refers to an employer which is engaged in
agriculture. This term refers to all farming activities in all its branches and includes,
among others, the cultivation and tillage of the soil, production, cultivation, growing and
harvesting of any agricultural or horticultural commodities, dairying, raising of livestock
or poultry, the culture of fish and other aquatic products in farms or ponds, and any
activities performed by a farmer or on a farm as an incident to or in conjunctions with
such farming operations, but does not include the manufacture and/or processing of
sugar, coconut, abaca, tobacco, pineapple, aquatic or other farm products. (Emphases
ours.)
Through a Labor Advisory dated October 24, 1996, then Secretary of Labor, and later
Supreme Court Justice, Leonardo A. Quisumbing (Secretary Quisumbing), provided
Guidelines for the Effective Implementation of Republic Act No. 7641, The Retirement Pay
Law, addressed to all employers in the private sector. Pertinent portions of said Labor
Advisory are reproduced below:
A. COVERAGE
RA 7641 or the Retirement Pay Law shall apply to all employees in the private sector,
regardless of their position, designation or status and irrespective of the method by
which their wages are paid. They shall include part-time employees, employees of
service and other job contractors and domestic helpers or persons in the
personal service of another.
The law does not cover employees of retail, service and agricultural establishments or
operations employing not more than [ten] (10) employees or workers and employees of
the National Government and its political subdivisions, including Government-owned
and/or controlled corporations, if they are covered by the Civil Service Law and its
regulations.
xxxx
C. SUBSTITUTE RETIREMENT PLAN
Qualified workers shall be entitled to the retirement benefit under RA 7641 in the
absence of any individual or collective agreement, company policy or practice. x x x
(Emphasis ours.)
Republic Act No. 7641 states that "any employee may be retired upon reaching the
retirement age x x x;" and "[i]n case of retirement, the employee shall be entitled to receive
such retirement benefits as he may have earned under existing laws and any collective
bargaining agreement and other agreements." The Implementing Rules provide that
Republic Act No. 7641 applies to "all employees in the private sector, regardless of their
position, designation or status and irrespective of the method by which their wages are paid,
except to those specifically exempted x x x." And Secretary Quisumbing' s Labor Advisory
further clarifies that the employees covered by Republic Act No. 7641 shall "include part-
time employees, employees of service and other job contractors and domestic helpers or
persons in the personal service of another."
The only exemptions specifically identified by Republic Act No. 7641 and its
Implementing Rules are: (1) employees of the National Government and its political
subdivisions, including government-owned and/or controlled corporations, if they are
covered by the Civil Service Law and its regulations; and (2) employees of retail, service
and agricultural establishments or operations regularly employing not more than 10
employees.
Based on Republic Act No. 7641, its Implementing Rules, and Secretary Quisumbing's
Labor Advisory, Bernardo, as a part-time employee of DLS-AU, is entitled to retirement
benefits. The general coverage of Republic Act No. 7641 is broad enough to encompass all
private sector employees, and part-time employees are not among those specifically
exempted from the law. The provisions of Republic Act No. 7641 and its Implementing
Rules are plain, direct, unambiguous, and need no further elucidation. Any doubt is
dispelled by the unequivocal statement in Secretary Quisumbing's Labor Advisory that
Republic Act No. 7641 applies to even part-time employees.
Under the rule of statutory construction of expressio unius est exclusio
alterius, Bernardo's claim for retirement benefits cannot be denied on the ground that he
was a part-time employee as part-time employees are not among those specifically
exempted under Republic Act No. 7641 or its Implementing Rules. Said rule of statutory
construction is explained thus:
It is a settled rule of statutory construction that the express mention of one person,
thing, or consequence implies the exclusion of all others. The rule is expressed in the
familiar maxim, expressio unius est exclusio alterius.
The rule of expressio unius est exclusio alterius is formulated in a number of ways. One
variation of the rule is the principle that what is expressed puts an end to that which is
implied. Expressum facit cessare taciturn. Thus, where a statute, by its terms, is
expressly limited to certain matters, it may not, by interpretation or construction, be
extended to other matters.
xxxx
The rule of expressio unius est exclusio alterius and its variations are canons of
restrictive interpretation. They are based on the rules of logic and the natural workings
of the human mind. They are predicated upon one's own voluntary act and not upon that
of others. They proceed from the premise that the legislature would not have made
specified enumeration in a statute had the intention been not to restrict its meaning and
confine its terms to those expressly mentioned.
The NLRC and the Court of Appeals did not err in relying on the Implementing Rules of
Republic Act No. 7641 in their respective judgments which favored Bernardo.
Congress, through Article 5 of the Labor Code, delegated to the Department of Labor
and Employment (DOLE) and other government agencies charged with the administration
and enforcement of said Code the power to promulgate the necessary implementing rules
and regulations. It was pursuant to Article 5 of the Labor Code that then Secretary of Labor
Ma. Nieves R. Confesor issued on January 7, 1993 the Rules Implementing the New
Retirement Law, which became Rule II of Book VI of the Rules Implementing the Labor
Code.
 In ruling that Bernardo, as part-time employee, is entitled to retirement benefits, we do
no less and no more than apply Republic Act No. 7641 and its Implementing Rules issued
by the DOLE under the authority given to it by the Congress. Needless to stress, the
Implementing Rules partake the nature of a statute and are binding as if written in the law
itself. They have the force and effect of law and enjoy the presumption of constitutionality
and legality until they are set aside with finality in an appropriate case by a competent court.
Moreover, as a matter of contemporaneous interpretation of law, Secretary
Quisumbing's Labor Advisory has persuasive effect. It is undisputed that in administrative
law, contemporaneous and practical interpretation of law by administrative officials charged
with its administration and enforcement carries great weight and should be respected,
unless contrary to law or manifestly erroneous.
We further find that the Implementing Rules and Secretary Quisumbing' s Labor
Advisory are consistent with Article 4 of the Labor Code, which expressly mandates that "all
doubts in the implementation and interpretation of the provisions of this Code, including its
implementing rules and regulations, shall be resolved in favor of labor." There being no
compelling argument herein to convince us otherwise, we uphold the legality and validity of
the Implementing Rules and Secretary Quisumbing's Labor Advisory, and likewise apply the
same to Bernardo's case.
For the availment of the retirement benefits under Article 302 [287] of the Labor Code,
as amended by Republic Act No. 7641, the following requisites must concur: (1) the
employee has reached the age of 60 years for optional retirement or 65 years for
compulsory retirement; (2) the employee has served at least five years in the establishment;
and (3) there is no retirement plan or other applicable agreement providing for retirement
benefits of employees in the establishment. Bernardo - being 75 years old at the time of his
retirement, having served DLS-AU for a total of 27 years, and not being covered by the
grant of retirement benefits in the CBA - is unquestionably qualified to avail himself of
retirement benefits under said statutory provision, i.e.,  equivalent to one-half month salary
for every year of service, a fraction of at least six months being considered as one whole
year.
Bernardo's employment was extended beyond the compulsory retirement age and
the cause of action for his retirement benefits accrued only upon the termination of
his extended employment with DLS-AU.
Article 306 [291] of the Labor Code mandates:
Art. 306 [291]. Money claims. - All money claims arising from employer-employee relations
accruing during the effectivity of this Code shall be filed within three years from the time the
cause of action accrued; otherwise they shall be forever barred.
DLS-AU invokes UST Faculty Union  v. National Labor Relations Commission, wherein
it was held that when an employee or official has reached the compulsory retirement age,
he is thereby effectively separated from the service. And so, DLS-AU maintains that
Bernardo's cause of action for his retirement benefits, which is patently a money claim,
accrued when he reached the compulsory retirement age of 65 years old, and had already
prescribed when Bernardo filed his complaint only 10 years later, when he was already 75
years old.
We are not persuaded.
The case of UST Faculty Union  is not in point as the issue involved therein was the
right of a union to intervene in the extension of the service of a retired employee. Professor
Tranquilina J. Marilio (Prof. Marilio) already reached the compulsory retirement age of 65
years old, but was granted by the University of Sto. Tomas (UST) an extension of two years
tenure. We ruled in said case that UST no longer needed to consult the union before
refusing to further extend Prof. Marilio' s tenure.
A cause of action has three elements, to wit, (1) a right in favor of the plaintiff by
whatever means and under whatever law it arises or is created; (2) an obligation on the part
of the named defendant to respect or not to violate such right; and (3) an act or omission on
the part of such defendant violative of the right of the plaintiff or constituting a breach of the
obligation of the defendant to the plaintiff.
Bernardo's right to retirement benefits and the obligation of DLS-AU to pay such
benefits are already established under Article 302 [287] of the Labor Code, as amended by
Republic Act No. 7641. However, there was a violation of Bernardo's right only after DLS-
AU informed him on November 8, 2003 that the university no longer intended to offer him
another contract of employment, and already accepting his separation from service,
Bernardo sought his retirement benefits, but was denied by DLSAU. Therefore, the cause of
action for Bernardo's retirement benefits only accrued after the refusal of DLS-AU to pay
him the same, clearly expressed in Dr. Bautista's letter dated February 12, 2004. Hence,
Bernardo's complaint, filed with the NLRC on February 26, 2004, was filed within the three-
year prescriptive period provided under Article 291 of the Labor Code.
Even granting arguendo  that Bernardo's cause of action already accrued when he
reached 65 years old, we cannot simply overlook the fact that DLS-AU had repeatedly
extended Bernardo's employment even when he already reached 65 years old. DLS-AU still
knowingly offered Bernardo, and Bernardo willingly accepted, contracts of employment to
teach for semesters and summers in the succeeding 10 years. Since DLS-AU was still
continuously engaging his services even beyond his retirement age, Bernardo deemed
himself still employed and deferred his claim for retirement benefits, under the impression
that he could avail himself of the same upon the actual termination of his employment. The
equitable doctrine of estoppel is thus applicable against DLS-AU. In Planters Development
Bank v. Spouses Lopez, we expounded on the principle of estoppels as follows:
Section 2, Rule 131 of the Rules of Court provides that whenever a party has, by his
own declaration, act, or omission, intentionally and deliberately led another to believe
that a particular thing is true, and to act upon such belief, he cannot, in any litigation
arising out of such declaration, act or omission, be permitted to falsify it.
The concurrence of the following requisites is necessary for the principle of equitable
estoppel to apply: (a) conduct amounting to false representation or concealment of
material facts or at least calculated to convey the impression that the facts are otherwise
than, and inconsistent with, those which the party subsequently attempts to assert; (b)
intent, or at least expectation that this conduct shall be acted upon, or at least
influenced by the other party; and (c) knowledge, actual or constructive, of the actual
facts.
Inaction or silence may under some circumstances amount to a misrepresentation, so
as to raise an equitable estoppel. When the silence is of such a character and under
such circumstances that it would become a fraud on the other party to permit the party
who has kept silent to deny what his silence has induced the other to believe and act
on, it will operate as an estoppel. This doctrine rests on the principle that if one
 maintains silence, when in conscience he ought to speak, equity will debar him from
speaking when in conscience he ought to remain silent.

DLS-AU, in this case, not only kept its silence that Bernardo had already reached the
compulsory retirement age of 65 years old, but even continuously offered him contracts of
employment for the next 10 years. It should not be allowed to escape its obligation to pay
Bernardo's retirement benefits by putting entirely the blame for the deferred claim on
Bernardo's shoulders.

WHEREFORE, premises considered, the instant Petition 1s DISMISSED for lack of

merit. The Decision dated June 29, 2009 and Resolution dated January 4, 2010 of the Court
of Appeals in CA-G.R. SP No. 106399 are AFFIRMED.
SO ORDERED.

Notes.—The company standards should be made known to the teachers on probationary status at the
start of their probationary period, or at the very least, at the start of the semester or the trimester during
which the probationary standards are to be applied. (Mercado vs. AMA Computer College-Parañaque
City, Inc., 618 SCRA 218 [2010])

It is settled that even if probationary employees do not enjoy permanent status, they are accorded the
constitutional protection of security of tenure. (Tamson’s Enterprises, Inc. vs. Court of Appeals, 660
SCRA 374 [2011])

——o0o——
 G.R. No. 133215. July 15, 1999
PAGPALAIN HAULERS, INC., petitioner, vs. The HONORABLE CRESENCIANO B.
TRAJANO, in his official capacity as Secretary of Labor and Employment, the
HONORABLE RENATO D. PARUNGO, in his official capacity as the MedArbiter in DOLE
Case No. NCR-OD-M-9705-006, and the INTEGRATED LABOR ORGANIZATION (ILO-
PHILS) PAGPALAIN WORKERS UNION-ILO-PHILS., respondents.
Labor Law; Labor Unions; The Labor Code does not require the submission of books of account in
order for a labor organization to be registered as a legitimate labor organization.—As can be gleaned
from the above, the Labor Code does not require the submission of books of account in order for a
labor organization to be registered as a legitimate labor organization. The requirement that books of
account be submitted as a requisite for registration can be found only in Book V of the Omnibus Rules
Implementing the Labor Code, prior to its amendment by Department Order No. 9, Series of 1997.
Specifically, the old Section 3(e), Rule II, of Book V provided that “[t]he local or chapter of a labor
federation or national union shall have and maintain a constitution and by-laws, set of officers and
books of accounts. For reporting purposes, the procedure governing the reporting of independently
registered unions, federations or national unions shall be observed.”
Constitutional Law; Separation of Powers; Statutory Construction; Courts exist for interpreting the
law, not for enacting it, and to allow otherwise would be violative of the principle of separation of
powers, inasmuch as the sole function of the courts is to apply or interpret the laws, particularly where
gaps or lacunae exist or where ambiguities becloud issues, but it will not arrogate unto itself the task of
legislating.—Under Article 8 of the Civil Code, “[j]udicial decisions applying or interpreting the laws or
the Constitution shall form a part of the legal system of the Philippines.” This does not mean, however,
that courts can create law. The courts exist for interpreting the law, not for enacting it. To allow
otherwise would be violative of the principle of separation of powers, inasmuch as the sole function of
our courts is to apply or interpret the laws, particularly where gaps or lacunae exist or where
ambiguities becloud issues, but it will not arrogate unto itself the task of legislating.
Administrative Law; Subordinate Legislation; For an administrative order to be valid, it must (i) be
issued on the authority of law and (ii) it must not be contrary to the law and the Constitution.—Neither
can Pagpalain contend that Department Order No. 9 is an invalid exercise of rule-making power by the
Secretary of Labor. For an administrative order to be valid, it must (i) be issued on the authority of law
and (ii) it must not be contrary to the law and the Constitution.
Same; Same; Labor Law; Labor Unions; Consonant with Article 5 of the Labor Code, the
Secretary of Labor and Employment promulgated the Omnibus Rules Implementing the Labor Code,
and by virtue of this self-same authority, the Secretary amended the above-mentioned omnibus rules
by issuing Department Order No. 9, Series of 1997.—Department Order No. 9 has been issued on
authority of law. Under the law, the Secretary is authorized to promulgate rules and regulations to
implement the Labor Code. Specifically, Article 5 of the Labor Code provides that “[t]he Department of
Labor and other government agencies charged with the administration and enforcement of this Code or
any of its parts shall promulgate the necessary implementing rules and regulations.” Consonant with
this article, the Secretary of Labor and Employment promulgated the Omnibus Rules Implementing the
Labor Code. By virtue of this self-same authority, the Secretary amended the above-mentioned
omnibus rules by issuing Department Order No. 9, Series of 1997.
Constitutional Law; Separation of Powers; The sole function of the courts is to apply or interpret
the laws—they do not formulate public policy, which is the province of the legislative and executive
branches of government; Notwithstanding the expanded judicial power under Section 1, Article VIII of
the Constitution, an inquiry on the policy of legislative or executive action would delve into matters of
wisdom not within the powers of the Supreme Court.—Pagpalain cannot also allege that Department
Order No. 9 is violative of public policy. As adverted to earlier, the sole function of our courts is to apply
or interpret the laws. It does not formulate public policy, which is the province of the legislative and
executive branches of government. It cannot, thus, be said that the principles laid down by the court in
Progressive and Protection Technology constitute public policy on the matter. They do, however,
constitute the Court’s interpretation of public policy, as formulated by the executive department through
its promulgation of rules implementing the Labor Code. However, this public policy has itself been
changed by the executive department, through the amendments introduced in Book V of the Omnibus
Rules by Department Order No. 9. It is not for us to question this change in policy, it being a well-
established principle beyond question that it is not within the province of the courts to pass judgment
upon the policy of legislative or executive action. Notwithstanding the expanded judicial power under
Section 1, Article VIII of the Constitution, an inquiry on the above-stated policy would delve into matters
of wisdom not within the powers of this Court.
ROMERO, J.:
On May 14, 1997, respondent Integrated Labor Organization-Pagpalain Haulers
Worker's Union (hereafter referred to as ILO-PHILS), in a bid to represent the rank-and-file
drivers and helpers of petitioner Pagpalain Haulers, Inc. (herafter referred to as Pagpalain),
filed a petition for certification election with the Department of Labor and Employment. ILO-
PHILS attached to the petition copies of its charter certificate, its constitution and by-laws,
its books of account, and a list of its officers and their addresses.
On July 10, 1997, Pagpalain filed a motion to dismiss the petition, alleging that ILO-
PHILS was not a legitimate labor organization due to its failure to comply with the
requirements for registration under the Labor Code. Specifically, it claimed that the books of
account submitted by ILO-PHILS were not verified under oath by its treasurer and attested
to by its president, as required by Rule II, Book V of the Omnibus Rules Implementing the
Labor Code.
In a reply dated August 4, 1997, ILO-PHILS dismissed Pagpalain's claims, saying that
Department Order No. 9, Series of 1997 had dispensed with the requirement that a local or
chapter of a national union submit books of account in order to be registered with the
Department of Labor and Employment.
Finding in favor of ILO-PHILS, the Med-Arbiter, on August 27, 1997, ordered the
holding of certification elections among the rank-and-file of Pagpalain Haulers. Pagpalain
promptly appealed the decision to the Secretary of Labor and Employment. It claimed that
the Med-Arbiter had gravely abused his discretion in allowing Department Order No. 9 to
take precedence over a ruling of the Supreme Court. Pagpalain cited Protection
Technology v. Secretary, Department of labor and Employment  1 and Progressive
Development Corporation v. Secretary of Labor in support of its contention.
Declaring Protection and Progressive to be inapplicable to the case before him, the
Secretary, on February 27, 1998, issued a resolution dismissing Pagpalain's appeal. In his
own words, "[i]n these aforementioned cases, the Supreme Court premised its ruling on the
previous rules implementing the Labor Code, particularly Book V, that provides the
requirements for registration of a local for chapter of a federation or national union. With the
issuance of Department Order No. 09 amending the rules implementing Book V of the
Code, the requirement on books of account no longer exists."
Aggrieved by said resolution, Pagpalain now comes to this Court for relief claiming that
the Secretary of Labor acted without jurisdiction in issuing the questioned resolution. In
support of its proposition, it claims that:
 1. DEPARTMENT ORDER NO. 9, SERIES OF 1997, ISSUED BY PUBLIC
RESPONDENT SECRETARY OF LABOR IS NULL AND VOID FOR BEING
CONTRARY TO PUBLIC POLICY LAID DOWN BY THE SUPREME COURT
IN PROTECTION TECHNOLOGY, INC. V. SECRETARY OF LABOR (G.R. NO.
117211, 1 MARCH 1995) AND PROGRESSIVE DEVELOPMENT CORP. V.
SECRETARY OF LABOR (G.R. NO. 96425, 4 FEBRUARY 1992);
2. DEPARTMENT ORDER NO. 9, SERIES OF 1997, OF PUBLIC RESPONDENT
SECRETARY OF LABOR CANNOT ALTER THE REQUIREMENTS OF ARTICLES
241(H) AND (J) OF THE LABOR CODE OF THE PHILIPPINES, NOR CAN IT PREVAIL
OVER THE RULINGS OF THE SUPREME COURT, WHICH FORM PART OF THE
LAW OF THE LAND.
Pagpalain's contentions are without merit.
Under Article 234 of the Labor Code, the requirements for registration of a labor
organization is as follows:
Art. 234. Requirements of registration. — Any applicant labor organization, association
or group of unions or workers shall acquire legal personality and shall be entitled to the
rights and privileges granted by law to legitimate labor organizations upon issuance of
the certificate of registration based on the following requirements:
(a) Fifty pesos (P50.00) registration fee;
(b) The names of its officers, their addresses, the principal address of the labor
organization, the minutes of the organizational meetings and the list of the
workers who participated in such meetings;
(c) The names of all its members comprising at least twenty percent (20%) of all
the employees in the bargaining unit where it seeks to operate;
(d) If the applicant union has been in existence for one or more years, copies of
its annual financial reports; and
(e) Four (4) copies of the constitution and by-laws of the applicant union,
minutes of its adoption or ratification, and the list of the members who
participated in it.
As can be gleaned from the above, the Labor Code does not require the submission of
books of account in order for a lobor organization to be registered as a legitimate labor
organization. The requirement that books of account be submitted as a requisite can be
found only in Book V of the Omnibus Rules Implementing the Labor Code, prior to its
amendment by Department Order No. 9, Series of 1997. Specifically, the old Section 3(e),
Rule II, of Book V provided that "[t]he local or chapter of a labor federation or national union
shall have and maintain a constitution and by-laws, set of officers and books of accounts.
For reporting purposes, the procedure governing the reporting of independently registered
unions, federations or national unions shall be observed."
In Progressive Development Corporation, cited by Pagpalain, this Court held that the
above-mentioned "'procedure governing the reporting of indepedently registered unions'
refers to the certification and attestation requirements contained in Article 235, paragraph
2." Article 235, paragraph 2 provides that "[a]ll requisite documents and papers shall be
certified under oath by the secretary or the treasurer of the organizations, as the case may
be, and attested to by its president;" hence, in the above-mentioned case, we ruled that in
applications for registration by a local or chapter of a federation or national union, the
constitution and by-laws, set of officers and books of account submitted by said local or
chapter must be certified under oath by the secretary or treasurer and attested to by its
president.
Three years, later, in Protection Technology v. Secretary of Labor, we amplified our
ruling in Progressive, saying that the non-submission of books of acocunt certified by and
attested to by the appropriate officer is a ground for an employer to legitimately oppose a
petition for certification election filed by a local or chapter of a national union.
By virtue of Department Order No. 9, Series of 1997, however, the documents needed
to be submitted by a local or chapter have been reduced to the following:
(a) A charter certificate issued by the federation or national union indicating the
creation or establishment of the local/chapter;
(b) The names of the local/chapter's officers, their addresses, and the principal
office of the local/chapter;
(c) The local/chapter's constitution and by-laws; provided that where the
local/chapter's constitution and by-laws is the same as that of the federation or
national union, this fact shall be indicated accordingly.
All the foregoing supporting requirements shall be certified under oath by the Secretary
or Treasurer of the local/chapter and attested by its President.
Since Department Order No. 9 has done away with the submission of books of account
as a requisite for registration, Pagpalain's only recourse now is to have said order declared
null and void. It premises its case on the principles laid down in Progressive and Protection
Technology. First, Pagpalain maintains that Department Order No. 9 is illegal, allegedly
because it contravenes the above-mentioned rulings of this Court. Citing Article 8 of the
Civil Code, which provides that [j]udicial decisions applying or interpreting the laws or the
Constitution shall form a part of the legal system of the Philippines," Pagpalain declares the
two cases part of the law of the land which, under the third paragraph of Article 7 of the Civil
Code, may not be supplanted by mere regulation.
Second, it claims that dispensing with books of account contravenes public policy,
citing Protection Technology, as follows:
It is immaterial that the Union, having been organized for less than a year before the
application for registration with the BLR, would have had no real opportunity to levy and
collect dues and fees from its members which need to be recorded in the books of
account. Such accounting books can and must be submitted to the BLR, even if they
contain no detailed or extensive entries as yet. The point to be stressed is that  the
applicant local or chapter must demonstrate to the BLR that it is entitled to registered
status because it has in place a system for accounting for members' contributions to its
fund even before it actually receives dues and fees from its members. The controlling
intention is to minimize the risk of fraud and diversion in the course of
the subsequent formation and growth of the Union fund. [Emphasis petitioner's]
To buttress its argument, Pagpalain also cites Progressive, thus:
The employer naturally needs assurance that the union it is dealing with is a bona fide
organization, one which has not submitted false statements or misrepresentations to the
Bureau. The inclusion of the certification and attestation requirements will in a marked
degree allay these apprehensions of management. Not only is the issuance of any false
statement and misrepresentation a ground for cancellation of registration (See Artide
239 (a), (c) and (d)); it is also a ground for a criminal charge of perjury.
The certification and attestation requirements are preventive measures against the
commission of fraud. They likewise afford a measure of protection to unsuspecting
employees who may be lured into joining unscrupulous or fly-by-night unions whose
sole purpose is to control union funds or to use the union for dubious ends. [Emphasis
petitioner's]
Finally, Pagpalain cites as indicative of public policy, the following sections of Article 241 of
the Labor Code:
The following are the rights and conditions of membership in a labor organization:
xxx xxx xxx
(h) Every payment of fees, dues, or other contributions by a member shall be evidenced
by a receipt signed by the officer or agent making the collection and entered  into the
record of the organization to be kept and maintained for the that purpose;
xxx xxx xxx
(j) Every income or revenue of the organization shall be evidenced by a record showing
its source, and every expenditure of its funds shall be evidenced by a receipt from the
person to whom the payment is made, which shall state the date, place and purpose of
such payment. Such record or receipt shall form part of the financial records of the
organizations. [Emphasis petitioner's]
Under Article 8 of the Civil Code, "[j]udicial decisions applying or interpreting the laws
or the Constitution shall form a part of the legal system of the Philippines." This does not
mean, however, that courts can create law. The courts exist for interpreting the law, not for
enacting it. To allow otherwise would be violative of the principle of separation of powers,
inasmuch as the sole function of our courts is to apply or interpret the laws, particularly
where gaps or lacunae exist or where ambiguities becloud issues, but it will not arrogate
unto itself the task of legislating.
Consequently, Progressive and Protection Technology are not to be deemed as laws
on the registration of unions. They merely interpret and apply the implementing rules of the
Labor Code as to registration of unions. It is this interpretation that forms part of the legal
system of the Philippines, for the inperpretation placed upon the written law by a competent
court has the force of law. Progressive and Protection Technology, however, applied and
interpreted the then existing Book V of the Omnibus Rules Implementing the Labor Code.
Since Book V of the Omnibus Rules, as amended by Department Order No. 9, no longer
requires a local or chapter to submit books of accounts as a prerequisites for registration,
the doctrines enunciated in the above-mentioned cases, with respect to books of account,
are already passé and therefore, no longer applicable. Hence, Pagpalain cannot insist that
ILO-PHILS comply with the requirements prescribed in said rulings, for the current
implementing rules have deleted the same.
Neither can Pagpalain contend that Department Order No. 9 is an invalid exercise of
rule-making power by the Secretary of Labor. For an administrative order to be valid, it must
i) be issued on the authority of law and (ii) it must not be contrary to the law and the
Constitution.
Department Order No. 9 has been issued on authority of law. Under the law, the
Secretary is authorized to promulgate rules and regulations to implement the Labor Code.
Specifically, Article 5 of the Labor Code provides that "[t]he Department of Labor and other
government agencies charged with the administration and enforcement of this Code or any
of its parts shall promulgate the necessary implementing rules and regulations." Consonant
with this article, the Secretary of Labor and Employment promulgated the Omnibus Rules
Implementing the Labor Code. By virtue of this self-same authority, the Secretary amended
the above-mentioned omnibus rules by issuing Department Order No. 9, Series of 1997.
Moreover, Pagpalain has failed to show that Department Order No. 9 is contrary to the
law or the Constitution. At the risk of being repetitious, the Labor Code does not require a
local or chapter to submit books of account in order for it to be registered as a legitimate
labor organization. There is, thus, no inconsistency between the Labor Code and
Department Order No. 9. Neither has Pagpalain shown that said order contravenes any
provision of the Constitution.
Pagpalain cannot also allege that Department Order No. 9 is violative of public policy.
As adverted to earlier, the sole function of our courts is to apply or interpret the laws. It does
not formulate public policy, which is the province of the legislative and executive branches
of government. It cannot, thus, be said that the principles laid down by the court in
Progressive and Protection Technology constitute public policy on the matter. They do,
however, constitute the Court's interpretation of public policy, as formulated by the
executive department through its promulgation of rules implementing the Labor Code.
However, this public policy has itself been changed by the executive department, through
the amendments introduced in Book V of the Omnibus Rules by Department Order No. 9. It
is not for us to question this change in policy, it being a well-established principle beyond
question that it is not within the province of the courts to pass judgment upon the policy of
legislative or executive action. Notwithstanding the expanded judicial power under Section
1, Article VIII of the Constitution, an inquiry on the above-stated policy would delve into
matters of wisdom not within the powers of this Court.
Furthermore, the controlling intention in requiring the submission of books of account is
the protection of labor through the minimization of the risk of fraud and diversion in the
handling of union funds. As correctly pointed out by the Solicitor General, this intention can
still be realized through other provisions of the Labor Code. Article 241 of the Labor Code,
for instance:
Art. 241. Rights and conditions of membership in a labor organization — The following
are the rights and conditions of membership in a labor organization:
x x x           x x x          x x x
(b) The members shall be entitled to full and detailed reports from their officers and
representatives of all financial transactions as provided for in the constitution and by-
laws of the organization;
x x x           x x x          x x x
(g) No officer, agent or member of a labor organization shall collect any fees, dues, or
other contributions in its behalf or make any disbursement of its funds unless he is duly
authorized pursuant to its constitution and by-laws;
(h) Every payment of fees, dues, or other contributions by a member shall be evidenced
by a receipt signed by the officer or agent making the collection and entered into the
record of the organization to be kept and maintained for the that purpose;
(i) The funds of the organization shall not be applied for any purpose or object other
than those expressly provided by its constitution or by-laws or those expressly
authorized by written resolution adopted by the majority of the members at a general
meeting duly called for the purpose;
(j) Every income or revenue of the organization shall be evidenced by a record showing
its source, and every expenditure of its funds shall be evidenced by a receipt from the
person to whom the payment is made, which shall state the date, place and purpose of
such payment. Such record or receipt shall form part of the financial records of the
organization.
x x x           x x x          x x x
(l) The treasurer of any labor organization and every officer thereof who is responsible
for the account of such organization or for the collection, management, disbursement,
custody or control of the fund, moneys and other properties of the organization, shall
render to the organization and to its members a true and correct account of all the
moneys received and paid by him since he assumed office or since the last day on
 which he rendered such account, and of all bonds, securities and other properties of the
organization entrusted to his custody or under his control. The rendering of such
account shall be made:
(1) At least once a year within 30 days after the close of its fiscal year;
(2) At such other times as may be required by a resolution of the majority of the
members of the organization;
(3) Upon vacating his office.
The account shall be duly audited and verified by affidavit and a copy thereof shall be
furnished the Secretary of Labor.
(m) The books of account and other records of the financial activities of any labor
organization shall be open to inspection by any officer or member thereof during office
hours;
x x x           x x x          x x x

Furthermore, Article 274 of the Labor Code empowers the Secretary of Labor or his
duly authorized representative to inquire into the financial activities of legitimate labor
organizations upon the filing of a complaint under oath duly supported by the written
consent of 20% of the total membership of the labor organization concerned, as well as to
examine their books of accounts and other records to determine compliance or non-
compliance with the law. All of these provisions are designed to safeguard the funds of a
labor organization that they may not be squandered or frittered away by its officers or by
third persons to the detriment of its members.

Lastly, Department Order No. 9 only dispenses with books of account as a requirement
for registration of a local or chapter of a national union or federation. As provided by Article
241 (h) and (j), a labor organization must still maintain books of account, but it need not
submit the same as a requirement for registration. Given the foregoing disquisition, we find
no cogent reason to declare Departmet Order No. 9 null and void, as well as to reverse the
assailed resolution of the Secretary of Labor.

WHEREFORE, premises considered, the instant petition is hereby DISMISSED for lack
of merit and the resolution of the Secretary of Labor dated February 27, 1998 AFFIRMED.
Costs against petitioner.
SO ORDERED.

Notes.—In subordinate, delegated rule-making by administrative agencies, all that may be reasonably
demanded is a showing that the delegated legislation consisting of administrative regulations are
germane to the general purposes projected by the governing or enabling statute. (Rabor vs. Civil
Service Commission, 244 SCRA 614 [1995])

Rate-fixing orders previously issued by the Philippine Ports Authority were in the nature of subordinate
legislation, promulgated by it in the exercise of delegated power, and as such these could only be
amended or revised by law. (Philippine Interisland Shipping Association of the Philippines vs. Court of
Appeals, 266 SCRA 489 [1997])

——o0o——