Labor Law cases

Calalang vs Williams - Social justice is "neither communism nor despotism, nor atomism, nor anarchy,"
but the humanization of laws and the equalization of social and economic forces by the State so that
justice in its rational and objectively secular conception may at least be approximated. Social justice
means the promotion of the welfare of all the people, the adoption by the Government of measures
calculated to insure economic stability of all the competent elements of society, through the
maintenance of a proper economic and social equilibrium in the interrelations of the members of the
community, constitutionally, through the adoption of measures legally justifiable, or extra-
constitutionally, through the exercise of powers underlying the existence of all governments on the
time-honored principle of salus populi est supremo, lex. Calalang vs. Williams et al., 70 Phil., 726, No.
47800 December 2, 1940

Agabon vs NLRC - The constitutional policy to provide full protection to labor is not meant to be a sword
to oppress employers—the commitment of this Court to the cause of labor does not prevent it from
sustaining the employer when it is in the right. Certainly, an employer should not be compelled to pay
employees for work not actually performed and in fact abandoned. The employer should not be
compelled to continue employing a person who is admittedly guilty of misfeasance or malfeasance and
whose continued employment is patently inimical to the employer.

An employee who is clearly guilty of conduct violative of Article 282 should not be protected by the
Social Justice Clause of the Constitution. Social justice, as the term suggests, should be used only to
correct an injustice.

PAL Employees Savings and Loan Association vs NLRC - Labor Contracts; Contracts of labor are explicitly
subject to the police power of the State. In connection with the foregoing, we should add that even if
there had been a meeting of the minds in the instant case, the employment contract could not have
effectively shielded petitioner from the just and valid claims of private respondent. Generally speaking,
contracts are respected as the law between the contracting parties, and they may establish such
stipulations, clauses, terms and conditions as they may see fit; and for as long as such agreements are
not contrary to law, morals, good customs, public policy or public order, they shall have the force of law
between them. And under the Civil Code, contracts of labor are explicitly subject to the police power of
the State because they are not ordinary contracts but are impressed with public interest. Inasmuch as in
this particular instance the contract in question would have been deemed in violation of pertinent labor
laws, the provisions of said laws would prevail over the terms of the contract, and private respondent
would still be entitled to overtime pay.

Innodata Philippines vs Quijada Lopez - Parties are not at liberty to insulate themselves and their
relationships from the impact of labor laws and regulations by simply contracting with each other; In
case of doubt the terms of a contract should be construed in favor of labor.—A contract of employment
is impressed with public interest. For this reason, provisions of applicable statutes are deemed written
into the contract. Hence, the “parties are not at liberty to insulate themselves and their relationships
from the impact of labor laws and regulations by simply contracting with each other.” Moreover, in case
of doubt, the terms of a contract should be construed in favor of labor.

Tirazona vs Pet - Separation pay shall be allowed as a measure of social justice only in those instances
where the employee is validly dismissed for causes other than serious misconduct or those reflecting on
his moral character. The policy of social justice is not intended to countenance wrongdoing simply
because it is committed by the underprivileged. At best it may mitigate the penalty but it certainly will
not condone the offense. Social justice cannot be permitted to be [a] refuge of scoundrels any more
than can equity be an impediment to the punishment of the guilty. Those who invoke social justice may
do so only if their hands are clean and their motives blameless and not simply because they happen to
be poor. This great policy of our Constitution is not meant for the protection of those who have proved
they are not worthy of it, like the workers who have tainted the cause of labor with the blemishes of
their own character”

People vs Panis - As we see it, the proviso was intended neither to impose a condition on the basic
rule nor to provide an exception thereto but merely to create a presumption. The presumption is that
the individual or entity is engaged in recruitment and placement whenever he or it is dealing with two
or more persons to whom, in consideration of a fee, an offer or promise of employment is made in
the course of the "canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring (of)
workers. "

The number of persons dealt with is not an essential ingredient of the act of recruitment and
placement of workers. Any of the acts mentioned in the basic rule in Article 13(b) win constitute
recruitment and placement even if only one prospective worker is involved. The proviso merely lays
down a rule of evidence that where a fee is collected in consideration of a promise or offer of
employment to two or more prospective workers, the individual or entity dealing with them shall be
deemed to be engaged in the act of recruitment and placement. The words "shall be deemed" create
that presumption.

Serrano vs Gallant - Section 18, Article II and Section 3, Article XIII accord all members of the labor
sector, without distinction as to place of deployment, full protection of their rights and welfare.

The enactment of the subject clause in R.A. No. 8042 introduced a differentiated rule of computation of
the money claims of illegally dismissed OFWs based on their employment periods, in the process singling
out one category whose contracts have an unexpired portion of one year or more and subjecting them
to the peculiar disadvantage of having their monetary awards limited to their salaries for 3 months or
for the unexpired portion thereof, whichever is less, but all the while sparing the other category from
such prejudice, simply because the latter’s unexpired contracts fall short of one year.

Prior to R.A. No. 8042, a uniform system of computation of the monetary awards of illegally dismissed
OFWs was in place. This uniform system was applicable even to local workers with fixed-term
employment.
The subject clause does not state or imply any definitive governmental purpose; and it is for that precise
reason that the clause violates not just petitioner’s right to equal protection, but also her right to
substantive due process under Section 1, Article III of the Constitution.

Millares vs Lagda - Seafarers are considered contractual employees; They can not be considered as
regular employees under Article 280 of the Labor Code.—From the foregoing cases, it is clear that
seafarers are considered contractual employees. They can not be considered as regular employees
under Article 280 of the Labor Code. Their employment is governed by the contracts they sign every
time they are rehired and their employment is terminated when the contract expires. Their employment
is contractually fixed for a certain period of time.

Petitioners insist that they should be considered regular employees, since they have rendered services
which are usually necessary and desirable to the business of their employer, and that they have
rendered more than twenty (20) years of service. While this may be true, the Brent case has, however,
held that there are certain forms of employment which also require the performance of usual and
desirable functions and which exceed one year but do not necessarily attain regular employment status
under Article 280.

Equi-Asia Placement vs DFA and DOLE - There is no reason to invalidate Section 52 of the Omnibus Rules
Implementing the Migrant Workers and Overseas Filipinos Act of 1995 as the law itself permits the
situation wherein a local recruitment agency can be held exclusively responsible for the repatriation of a
deceased Overseas Filipino Worker (OFW).

Petitioner’s argument that Section 15 does not provide that it shall be primarily responsible for the
repatriation of a deceased OFW is specious and plain nitpicking. While Republic Act No. 8042 does not
expressly state that petitioner shall be primarily obligated to transport back here to the Philippines the
remains of the deceased Razon, nevertheless, such duty is imposed upon him as the statute clearly
dictates that “the repatriation of remains and transport of the personal belongings of a deceased worker
and all costs attendant thereto shall be borne by the principal and/or the local agency.” The mandatory
nature of said obligation is characterized by the legislature’s use of the word “shall.” That the concerned
government agencies opted to demand the performance of said responsibility solely upon petitioner
does not make said directives invalid as the law plainly obliges a local placement agency such as herein
petitioner to bear the burden of repatriating the remains of a deceased OFW with or without recourse
to the principal abroad. Equi-Asia Placement, Inc. vs. Department of Foreign Affairs, 502 SCRA 295, G.R.
No. 152214 September 19, 2006

Finnman General Assurance - POEA and DOLE have the power to compel surety to make good on its
solidary undertaking in the same proceedings where the liability of principal obligor is determined.—The
fundamental argument of Finman is that its liability under its own bond must be determined and
enforced, not by the POEA or the Secretary of Labor, but rather by the Insurance Commission or by the
regular courts. Once more, we are not moved by petitioner’s argument. There appears nothing so
special or unique about the determination of a surety’s liability under its bond as to restrict that
determination to the Office of the Insurance Commissioner and to the regular courts of justice
exclusively.

Cash and surety bonds are required by the POEA and its predecessor agencies from recruitment and
employment companies precisely as a means of ensuring prompt and effective recourse against such
companies when held liable for applicants’ or workers’ claims. Clearly that public policy will be
effectively negated if POEA and the Department of Labor and Employment were held powerless to
compel a surety company to make good on its solidary undertaking in the same quasijudicial proceeding
where the liability of the principal obligor, the recruitment or employment agency, is determined and
fixed and where the surety is given reasonable opportunity to present any defenses it or the principal
obligor may be entitled to set up. Petitioner surety whose liability to private respondents and the POEA
is neither more nor less than that of Pan Pacific, is not entitled to another or different procedure for
determination or fixing of that liability than that which Pan Pacific is entitled and subject to.

Eastern Assurance vs Secretary of Labor - Secretary of Labor has the power and authority not only to
restrict and regulate the recruitment and placement activities of all agencies but also to promulgate
rules and regulations to carry out the objectives and implement the provisions governing said activities.
Implicit in these powers is the award of appropriate relief to the victims of the offenses committed by
the respondent agency or contractor, specially the refund or reimbursement of such fees as may have
been fraudulently or otherwise illegally collected, or such money, goods or services imposed and
accepted in excess of what is licitly prescribed. It would be illogical and absurd to limit the sanction on
an offending recruitment agency or contractor to suspension or cancellation of its license, without the
concomitant obligation to repair the injury caused to its victims. It would result either in rewarding
unlawful acts, as it would leave the victims without recourse, or in compelling the latter to litigate in
another forum, giving rise to that multiplicity of actions or proceedings which the law abhors.

Catan vs NLRC - The employee’s injury was sustained during the lifetime of the employment contract as
no notice of termination of the contract was given by either or both of the parties at least a month
before its expiration.—Private respondents contract of employment can not be said to have expired on
May 14, 1983 as it was automatically renewed since no notice of its termination was given by either or
both of the parties at least a month before its expiration, as so provided in the contract itself. Therefore,
private respondent’s injury was sustained during the lifetime of the contract.

A private employment agency may be sued jointly and solidarily with its foreign principal for violations
of the recruitment agreement and the contracts of employment.—A private employment agency may be
sued jointly and solidarily with its foreign principal for violations of the recruitment agreement and the
contracts of employment.

Even if petitioner and the Saudi principal had already severed their agency agreement at the time
private respondent was injured, petitioner may still be sued for violation of the employment contract.—
Even if indeed petitioner and the Saudi principal had already severed their agency agreement at the
time private respondent was injured, petitioner may still be sued for a violation of the employment
contract because no notice of the agency agreement’s termination was given to the private respondent.

People vs Bulu Chowdury - Illegal Recruitment in Large Scale; Elements.—The elements of illegal
recruitment in large scale are: (1) The accused undertook any recruitment activity defined under Article
13 (b) or any prohibited practice enumerated under Article 34 of the Labor Code; (2) He did not have the
license or authority to lawfully engage in the recruitment and placement of workers; and (3) He
committed the same against three or more persons, individually or as a group.

An employee of a company or corporation engaged in illegal recruitment may be held liable as principal,
together with his employer, if it is shown that he actively and consciously participated in illegal
recruitment.—As stated in the first sentence of Section 6 of RA 8042, the persons who may be held
liable for illegal recruitment are the principals, accomplices and accessories. An employee of a company
or corporation engaged in illegal recruitment may be held liable as principal, together with his employer,
if it is shown that he actively and consciously participated in illegal recruitment. It has been held that the
existence of the corporate entity does not shield from prosecution the corporate agent who knowingly
and intentionally causes the corporation to commit a crime. The corporation obviously acts, and can act,
only by and through its human agents, and it is their conduct which the law must deter. The employee
or agent of a corporation engaged in unlawful business naturally aids and abets in the carrying on of
such business and will be prosecuted as principal if, with knowledge of the business, its purpose and
effect, he consciously contributes his efforts to its conduct and promotion, however slight his
contribution may be.
The corporation also incurs criminal liability for the act of its employee or agent if (1) the employee or
agent committed the offense while acting within the scope of his employment and (2) the offense was
committed with at least some intent to benefit the employer. The liability is imputed to the corporation
not because it actively participated in the malice or fraud but because the act is done for the benefit of
the corporation while the employee or agent was acting within the scope of his employment in the
business of the corporation, and justice requires that the latter shall be held responsible for damages to
the individual who suffered by such conduct.

People vs Segun - Illegal Recruitment; Elements of the crime of illegal recruitment in large scale.—The
crime of illegal recruitment in large scale is committed when three elements concur. First, the offender
has no valid license or authority required by law to enable one to lawfully engage in recruitment and
placement of workers. Second, he or she undertakes either any activity within the meaning of
“recruitment and placement” defined under Article 13 (b), or any prohibited practices enumerated
under Article 34 of the Labor Code. Third, the offender commits said acts against three or more persons,
individually or as a group.

There is no dispute that the first element is present in this case. The certification dated May 17, 1993
and issued by DOLE Region XII Director Allen Macaraya, states that appellants “were not authorized to
conduct recruitment for local and overseas employment.” Both appellants conceded they have no
license to recruit. Did the prosecution prove beyond a reasonable doubt that appellants canvassed,
enlisted, contracted and transported the thirteen persons listed in the information? In examining the
prosecution’s evidence, we bear in mind that a conviction for large scale illegal recruitment must be
based on a finding in each case of illegal recruitment of three (3) or more persons whether individually
or as a group. While the law does not require that at least three (3) victims testify at the trial, it is
necessary that there is sufficient evidence proving that the offense was committed against three (3) or
more persons.

As we held earlier, “recruit” is a legal conclusion. The witness must testify as to the facts that would
prove recruitment. It does not suffice that the witness simply state that the accused “recruited” the
“victim.” Hence, the testimony of Josephine Aba that appellants “recruited” her nephews is, by itself,
insufficient to convict appellants for the recruitment of Pedro and Pablo Ozarraga.

In sum, the prosecution failed to elicit from many of its witnesses the specific acts constituting the
recruitment of the other alleged victims. The prosecution was able to prove that appellants performed
recruitment activities only in the cases of Victoria Collantes and Loreta Cavan. The third element of
illegal recruitment, i.e., that the offender commits the acts of recruitment against three or more persons
is, therefore, absent. Consequently, appellants can be convicted only of two counts of “simple” illegal
recruitment.