LABOR LAW Q&A

(J. Leonen Cases in Q&A Format from November 2012 – December 2019)

UST FACULTY OF CIVIL LAW

Q: Eden is a general manager of Talisay Water
District in Talisay City, Negros Occidental.
The Commission on Audit disallowed a total
amount of P 380,208.00 which Eden received
as part of her salary as the Water District's
general manager from 2005 to 2006. It found
that Eden's salary as general manager "was
not in consonance with the rate prescribed
under Republic Act No. 6758, otherwise
known as the Salary Standardization Law.
Eden argued that Section 23 of the Provincial
Water Utilities Act of 1973 gives Talisay
Water District board of directors the right to
fix and increase his salary as general
manager and is an exception to the Salary
Standardization Law, and that he relied on
Section 23 in good faith hence, she cannot be
ordered to refund the amount he received. Is
Eden's contention correct?
A: NO. Section 23 of Presidential Decree No. 198
does not exempt water utilities from the
coverage of the Salary Standardization Law.
However, this does not mean that water utilities
cannot fix the compensation of their respective
general managers. Section 23 of Presidential
Decree No. 198 clearly provides that a water
utility's board of directors has the power to
define the duties and fix the compensation of a
general manager. The compensation fixed must
be in accordance with the position classification
system under the Salary Standardization Law.  in Republic Act No. 9946 does not preclude the
All told, the general manager position of a water
district is covered by the Salary Standardization
Law. The Commission on Audit did not gravely
abuse its discretion in disallowing petitioner
Eden's compensation for exceeding the rate
provided in the Salary Standardization Law.
Eden relied on Sec. 23 hence, she received the
disallowed salaries in good faith. She need not
refund the disallowed amount. (Engineer
Manolito Mendoza v. Commission on Audit, GR No.
195395, September 10, 2013)
Q: Judge Gruba died while in service at the
age of 55. He was in the government service
for 16 years. In those years, he rendered
service for 3 years in the Judiciary. Mrs.
Gruba, his surviving spouse, applied for
retirement/gratuity benefits under R.A. No.
910. Thereafter, a total of P1,486,500.00,
representing the five-year lump sum gratuity
due to Judge Gruba, was paid to his heirs. On
January 13, 2010, Congress amended
Republic Act No. 910 and passed Republic Act
No. 9946. Republic Act No. 9946 provided for
more benefits, including survivorship
pension benefits, among others. On January
11, 2012, Mrs. Gruba applied for survivorship
pension benefits under Republic Act No.
9946. The Court approved the application
and she received P1,026,748.00 for
survivorship pension benefits from January
1, 2011 to April 2012. However, on November
27, 2012, this Court directed the Court of Tax
Appeals to discontinue the payment of the
survivorship pension benefits to Mrs. Gruba.
Are the heirs of Judge Gruba entitled to the
10-year lump sum gratuity benefits under
R.A. No. 9946? 
A: YES. The heirs of Judge Gruba are entitled to
10-year lump sum death gratuity benefits under
R.A. No. 9946. Judge Gruba's death follows the
second scenario under Section 2 of Republic Act
No. 9946. He died due to natural causes while
serving the Judiciary. He rendered 16 years, six
(6) months, and 21 days in government service,
thereby complying with the 15-year service
requirement under the law. The fact that the
heirs of Judge Gruba received death benefits
under Republic Act No. 910 prior to amendments
heirs from receiving the 10-year lump sum in
full. This is the effect of the retroactivity
mentioned in Section 3-B of Republic Act No.
9946. (Re: Application for Survivorship Pension
Benefits under R.A. No. 9946 of Mrs. Pacita A.
Gruba, A.M. No. 14155-Ret., November 19, 2013)
Q: Is Mrs. Gruba is entitled to survivorship
pension benefits under the same law?
A: NO. Mrs. Gruba is not qualified for
survivorship benefits under R.A. No. 9946.
According to Section 3 of Republic Act No. 9946,
survivorship pension benefits are given to
surviving spouses of retired judges or justices or
surviving spouses of judges or justices who are
eligible to retire optionally. This means that for
the spouse to qualify for survivorship pension,
the deceased judge or justice must (1) be at least
60 years old, (2) have rendered at least fifteen
years in the Judiciary or in any other branch of
government, and in the case of eligibility for
optional retirement, (3) have served the last
three years continuously in the Judiciary.
When the judge or justice is neither
retired nor eligible to retire, his or her surviving
spouse is not entitled to those benefits. Judge
Gruba neither retired compulsorily prior to his
death nor was he eligible for optional retirement
at the time of his death. He would have qualified
for the government service requirements.
However, his age at the time of his death did not
make him qualified for optional retirement. He
was only 55 years old, and the law required the
age of 60 for eligibility for optional retirement.
However, the Court no longer required Mrs.
Gruba to reimburse survivorship pension
benefits received by virtue of the earlier
Resolution dated January 17, 2012 considering
that she received those payments in good faith.
(Re: Application for Survivorship Pension Benefits
under R.A. No. 9946 of Mrs. Pacita A. Gruba, A.M.
No. 14155-Ret., November 19, 2013)
Q: Joy was deployed to work for Taiwan
Wacoal, Co. Ltd. on June 26, 1997 for one
year. Sameer Overseas Placement Agency
claims that on July 14, 1997, Mr. Huwang
from Wacoal informed Joy, without prior
notice, that she was terminated and that she
should prepare for immediate repatriation.
Hence, Joy filed a complaint with the NLRC
claiming that she was illegally dismissed. The
NLRC declared that Joy was illegally
dismissed, ruling that Sameer Overseas
Placement Agency failed to prove that there
were just causes for termination. Sameer
Overseas Placement Agency counters that
there was just cause for termination because
there was a finding of Wacoal of Joy’s
inefficiency, negligence in her duties, and
failure to comply with the work requirements
of her foreign employer. Therefore, it claims
that Joy’s dismissal was valid. Was Joy
illegally dismissed?
A: YES. Security of tenure for labor is guaranteed
by our Constitution. With respect to the rights of
overseas Filipino workers, we follow the
principle of lex loci contractus. By our laws,
overseas Filipino workers (OFWs) may only be
terminated for a just or authorized cause and
after compliance with procedural due process
requirements. Joy’s dismissal less than one year
from hiring and her repatriation on the same day
show not only failure on the part of Sameer
Overseas Placement Agency to comply with the
requirement of the existence of just cause for
termination. They patently show that the
employers did not comply with the due process
requirement. The abruptness of the termination
negated any finding that she was properly
notified and given the opportunity to be heard.
Her constitutional right to due process of law
was violated. (Sameer Overseas Placement
Agency v. Joy Cabiles, GR No. 170139, August 5,
2014)
Q: On July 1986, Arriola was employed as a
correspondent assigned in Olongapo City and
Zambales under Pilipino Star Ngayon, Inc.
(Pilipino Star). Sometime in November 2002,
after his column was removed from
publication, Arriola never returned for work.
Three years later, Arriola filed an illegal
dismissal complaint against Pilipino Star
stating that he was “arbitrarily dismissed.”
Arguing that he was a regular employee,
Arriola contended that his rights to security
of tenure and due process were violated. On
the other hand, Pilipino Star claims that he
was never dismissed, in fact, they tried calling
and sending him messages to report for work
but to no avail until such time that they
discovered that Arriola transferred to a rival
newspaper publisher. The Labor Artbiter
dismissed the case stating that there was no
illegal dismissal for Arriola was the one who
abandoned his work. Is the Labor Arbiter
correct in dismissing the complaint?
A: YES. Pilipino Star Ngayon, Inc. did not illegally
dismiss Ariolla. The removal of Arriola’s column
from Pilipino Star’s newspaper is not tantamount
to a termination of his employment as his job is
not dependent on the existence of the column.
Moreover, a newspaper publisher has the
management prerogative to determine what
columns to print in its newspaper. Furthermore,
it took him three years to file the complaint of
illegal dismissal which is a clear intention to
sever his employment with Pilipino Star Ngayon,
Inc. (George Arriola  v. Pilipino Star Ngayon, Inc.,
GR No. 175689, August 13, 2014)
Q: Montinola is a flight attendant of PAL since
1996. On January 29, 2008, Montinola and
other flight crew members were subjected to
custom searches in Hawaii. Items from the
airline were recovered from the flight crew
by customs officials. Nancy Graham
(Graham), US Customs and Border Protection
Supervisor, sent an email to PAL regarding
the search. The email contained a list of PAL
flight crew members involved in the search,
included in the list is the petitioner, while
another email enumerated the list of items
taken from the crew members. On February
1, 2008, PAL's Cabin Services Sub-
Department required Montinola to comment
on the incident. She gave a handwritten
explanation three days after, stating that she
did not take anything from the aircraft. She
also committed to give her full cooperation
should there be any further inquiries on the
matter. PAL found Montinola guilty of 11
violations of the company's Code of Discipline
and Government Regulation. She was meted
with suspension for one (1) year without pay.
Montinola brought the matter before the
Labor Arbiter. The Labor Arbiter found her
suspension illegal, finding that PAL never
presented evidence that showed Montinola
as the one responsible for any of the illegally
taken airline items. The Labor Arbiter
ordered Montinola's reinstatement with
backwages, inclusive of allowances and
benefits amounting to PhP378,630.00. In
addition, the Labor Arbiter awarded moral
damages in the amount of PhP100,000.00
and exemplary damages amounting to
PhP100,000.00. She is also entitled to
attorney’s fees. Whether or not Montinola’s
illegal suspension entitled her to an award of
moral and exemplary damages and
attorney’s fees?
A: YES. Under the Labor Code, the employee is
entitled to moral damages when the employer
acted: a) in bad faith or fraud; b) in a manner
oppressive to labor; or c) in a manner contrary
to morals, good customs, or public policy. PAL's
actions in implicating Montinola and penalizing
her for no clear reason show bad faith. PAL's
denial of her request to clarify the charges
against her shows its intent to do a wrongful act
for moral obliquity. If it were acting in good
faith, it would have gathered more evidence
from its contact in Honolulu or from other
employees before it started pointing fingers. PAL
should not have haphazardly implicated
Montinola and denied her livelihood even for a
moment. PAL apparently granted Montinola
procedural due process by giving her a notice of
administrative charge and conducting a hearing.
However, this was more apparent than real. The
notice of administrative charge did not specify
the acts committed by Montinola and how these
acts violated PAL's Code of Discipline. The notice
did not state which among the items confiscated
by the US customs officials were originally found
in Montinola's possession. Worse, the panel of
PAL officers led by Atty. Pascual did not
entertain any query to clarify the charges against
her.
Montinola is also entitled to exemplary damages.
In Garcia v. NLRC, this court ruled that in labor
cases, the court may award exemplary damages
"if the dismissal was effected in a wanton,
oppressive or malevolent manner." It is socially
deleterious for PAL to suspend Montinola
without just cause in the manner suffered by her.
Hence, exemplary damages are necessary to
deter future employers from committing the
same acts.
Montinola is also entitled to attorney's fees.
Article 2208 of the Civil Code enumerates the
instances when attorney's fees can be awarded.
This case qualifies for the first, second, and
seventh reasons why attorney's fees are
awarded under the Civil Code. First, considering
that we have awarded exemplary damages in
this case, attorney's fees can likewise be
awarded. Second, PAL's acts and omissions
compelled Montinola to incur expenses to
protect her rights with the NLRC and the judicial
system. She went through four tribunals, and she
was assisted by counsel. These expenses would
have been unnecessary if PAL had sufficient
basis for its decision to discipline Montinola.
Finally, the action included recovery for wages.
To bring justice to the illegal suspension of
Montinola, she asked for backwages for her year
of suspension. (Nancy Montinola v. Philippine
Airlines, GR No. 198656, September 8, 2014)
Q: Spouses Dela Cruz offered Automat
Company to occupy the land it recently
bought to prevent illegal settlers from
settling on the land. The company agreed on
the condition that the spouses will vacate on
demand and a rental fee shall be established.
The spouses proceeded to till and introduce
improvements on the land. The land was
earlier on reclassified as non-agricultural
prior to 1988 when the CARL was enacted.
Later on Automat requested the Spouses to
vacate the property, which the later refused
to do so, on the defense that they were
tenants and enjoy security of tenure as
tenants for 10 years. Was there a tenancy
relationship between the parties?
A: NO. The elements to constitute a tenancy
relationship are the following: (1) the parties are
the landowner and the tenant or agricultural
lessee; (2) the subject matter of the relationship
is agricultural land; (3) there is consent between
the parties to the relationship; (4) the purpose of
the relationship is to bring about agricultural
production; (5) there is personal cultivation on
the part of the tenant or agricultural lessee; and
(6) the harvest is shared between the landowner
and the tenant or agricultural lessee. (Automat
Realty and Development Corporation v. Sps. Dela
Cruz, GR No. 192026, October 1, 2014)
Q: Padilla was a regular employee at Am-Phil,
working as a marketing officer. One day he
received a notification that the company is
undergoing a retrenchment program and he
is going to be retrenched. He questioned this
notification holding that he is a regular
employee, while there are 6 contractual
employees. He was given a choice to be
retrenched or essentially to be demoted. He
was eventually retrenched and received a
separation pay, and executed a quit claim and
release in favor of Am-Phil. He filed for illegal
dismissal. Was there a valid retrenchment in
the first place?
A: NO. The company did not fulfill the
requirements of a valid retrenchment.
Retrenchment entails an exercise of management
prerogative. Nevertheless, a company’s exercise
of its management prerogatives is not absolute.
It cannot exercise its prerogative in a cruel,
repressive, or despotic manner. The following
requisites must concur for a valid retrenchment:
(1) That the retrenchment is reasonably
necessary and likely to prevent business losses
which; (2) That the employer served written
notice both to the employees and to the DOLE at
least one month prior to the intended date of
retrenchment; (3) That the employer pays the
retrenched employees separation pay equivalent
to one month pay or at least ½ month pay for
every year of service, whichever is higher; (4)
That the employer exercises its right in good
faith for the advancement of its interest and not
to defeat or circumvent the employees’ right to
security of tenure; and (5) That the employer
used fair and reasonable criteria in ascertaining
who would be dismissed and who would be
retained among the employees. (Am-Phil Food
Concepts v. Paolo Jesus Padilla, GR No. 188753,
October 1, 2014)
Q: Monana was employed at MEC Global
Shipping Management for 6 months as a
Seafarer. Aboard the vessel he suffered an
illness which the doctor on board gave him
anti-hypertensive medicine. The next day, he
was airlifted to Honolulu Hospital where he
was diagnosed to have suffered a stroke. He
was repatriated to the Philippines, where the
company doctor declared his illness to be
non-work related. As 240 days passed while
he was being treated, he sought a second
opinion from another doctor, who declared
his illness to be work-related. Thus, he is now
claiming for a total and permanent disability
benefit. Can he claim for the benefit?
A: NO. His reliance on the second opinion is
erroneous. In case there is disagreement on the
opinion of the company doctor and a private
doctor, a third doctor chosen by the two parties
need to be consulted. Furthermore, several
jurisprudence have given more weight to the
assessment of the doctor that closely monitored
and actually treated the seafarer. (Joel Monana v.
MEC Global Shipmanagement and Manning Corp.,
GR No. 196122, November 12, 2014)
Q: Joppette, Montasia, Ruth and Loraine
where employed as flight attendant by Saudi
Arabian Airlines  (Saudia). They filed
maternity leave in various dates in 2006.
Although there were initial acceptance of the
leave, however, this was ultimately denied
and requested them to tender their
resignation. Saudia invoked the Unified
Contract, wherein in case of pregnancies, the
employment contract of female cabin crew
member are deemed void. They appealed to
the management. But they were told that iff
they would not reign they would be
terminated.  The threat of termination
entailed the loss of benefits, such as
separation pay and ticket discount
entitlements. Thus, they tendered their
resignation written in their own handwriting.
They later filed a case for illegal dismissal.
Were the petitioners illegally dismissed.
A: YES. For there to be a voluntary resignation,
there must be voluntariness. It must be the result
of an employee's exercise of his or her own will.
In this case, clearly the women wanted only to
avail of the maternity leave. Furthermore, the
court already devised a means to determine
voluntary resignation. As the intent to relinquish
must concur with the overt act of
relinquishment, the acts of the employee before
and after the alleged resignation must be
considered in determining whether he or she, in
fact, intended, to sever his or her employment
In this case, the act before the resignation is for
application of maternity leave, and appealed the
case to management when they were being
asked to resign. This is clear indication the intent
of these women to stay in the employ of Saudia.
(Saudi Arabian Airlines v. Ma. Jopette Rebesencio,
GR No. 198587, January 14, 2015)
Q: Solid Mills’ employees and their families
were allowed to occupy SMI Village, a
property owned by Solid Mills. According to
Solid Mills, this was "out of liberality and for
the convenience of its employees and on the
condition that the employees would vacate
the premises anytime the Company deems
fit." The employees were informed that Solid
Mills would cease operations. NAFLU,
employees’ collective bargaining agent
recognized Solid Mills’ closure due to serious
business losses in the memorandum of
agreement. The memorandum of agreement
provided for Solid Mills’ grant of separation
pay less accountabilities, accrued sick leave
benefits, vacation leave benefits, and 13th
month pay to the employees.  obligation due from the employee to the
Solid Millssent notices to the employees
to vacate the property. The employees then
assailed the withholding of their benefits
subject to the condition that they will
surrender the premises, as illegal. Thus the
employees filed a complaint before the labor
arbiter.
A. Is the question of the withholding of
benefits subject to the claim of the
employer within the jurisdiction of the
Labor Arbiter? 
B. Was the withholding of the benefits
justified? 
A:
A. YES. Claims arising from an employer-
employee relationship are not limited to
claims by an employee. Employers may also
have claims against the employee, which
arise from the same relationship.
In this case, Solid Mills claims that its
properties are in the employees’ possession by
virtue of their status as its employees. Solid Mills
allowed its employees to use its property as an
act of liberality. Put in other words, it would not
have allowed the claimants to use its property
had they not been its employees. The return of
its properties in the employees’ possession by
virtue of their status as employees is an issue
that must be resolved to determine whether
benefits can be released immediately. The issue
raised by the employer is, therefore, connected
to employees’ claim for benefits and is
sufficiently intertwined with the parties’
employer-employee relationship. Thus, it is
properly within the labor tribunals’ jurisdiction.
(Emer Milan v. NLRC, GR No. 202961, February 4,
2015)
B. YES. As a general rule, employers are
prohibited from withholding wages from
employees. The Civil Code provides that the
employer is authorized to withhold wages for
debts due:
Article 1706. Withholding of the wages,
except for a debt due, shall not be made
by the employer.
"Debt" in this case refers to any
employer. It includes any accountability that the
employee may have to the employer.
"Accountability," in its ordinary sense, means
obligation or debt. The ordinary meaning of the
term "accountability" does not limit the
definition of accountability to those incurred in
the worksite. As long as the debt or obligation
was incurred by virtue of the employer-
employee relationship, generally, it shall be
included in the employee’s accountabilities that
are subject to clearance procedures. (Emer Milan
v. NLRC, GR No. 202961, February 4, 2015)
Q. Fuentes was hired as security guard by
Protective Maximum Security Agency. During
his tenure, a robbery incident occurred
whereby he was indicted as a conspirator
and, thus, was detained upon orders of the
court. During the period of investigation the
Provincial Prosecutor issued a Resolution
dismissing the Complaint against Fuentes.
Resultantly, Fuentes demanded to return to
work but he was refused entry by a certain
Mr. Regildo Espinosa on the ground of
abandonment. Was Fuentes’ dismissal valid?
A. NO. Abandonment is the deliberate and
unjustified refusal of an employee to resume his
employment. It is a form of neglect of duty,
hence, a just cause for termination of
employment by the employer. For a valid finding
of abandonment, these two factors should be
present: (1) the failure to report for work or
absence without valid or justifiable reason; and
(2) a clear intention to sever employer-employee
relationship, with the second as the more
determinative factor which is manifested by
overt acts from which it may be deduced that the
employees has no more intention to work.
Fuentes’ act of reporting for work after being
cleared of the charges against him showed that
he had no intention to sever ties with his
employer. Also, the intervening period when
respondent failed to report for work, from
respondent's prison release to the time he
actually reported for work, was justified.
(Protective Maximum Security Agency, Inc. v.
Celso Fuentes, GR No. 169303, February 11, 2015)
Q: Paz is an employee of Northern Tobacco
Redrying Co., Inc. (NTRCI) for 29 years as a
seasonal sorter. In 2003, NTRCI informed her
that she was considered retired under
company policy. A year later, NTRCI told her
she would receive ₱12,000.00 as retirement
pay. Paz then filed a Complaint for payment
of retirement benefits, damages, and
attorney’s fees as ₱12,000.00 seemed
inadequate for her 29 years of service. Is the
retirement pay computed correctly? 
A: YES.  Retirement pay pursuant to Article 287
of the Labor Code was correctly computed at
₱12,487.50 and was awarded to petitioner Paz.
In the absence of a 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 the 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
(1/2) 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. (Zenaida Paz v.
Northern Tobacco Redrying Co., Inc., GR No.
199554, February 18, 2015)
Q: Rivera, a bus conductor of Genesis, was
dismissed on account of a discrepancy in the
amount he declared on bus ticket receipts. He
reported and remitted the amount of P198.00
instead of the admittedly correct amount of
P394.00 worth of bus ticket receipts. He
averred that it was an honest mistake, which
he was unable to correct because the bus
encountered mechanical problems.
Contending that this termination was
arbitrary and not based on just causes for
terminating employment, he filed a complaint
for illegal dismissal. Genesis claimed that
Rivera's misdeclaration of the amount in the
bus ticket receipts and failure to remit the
correct amount clearly violated Genesis'
policies and amounted to serious misconduct,
fraud, and willful breach of trust; thereby
justifying his dismissal. Was Rivera
terminated with just cause?
A: NO. Absent any other supporting evidence, the
error in a single ticket issued by petitioner can
hardly be used to justify the inference that he has
committed serious misconduct or has acted in a
manner that runs afoul of his employer's trust.
Terminating his employment on these
unfounded reasons is manifestly unjust. The
social justice suppositions underlying labor laws
require that the statutory grounds justifying
termination of employment should not be read to
justify the view that bus conductors should, in all
cases, be free from any kind of error. Not every
improper act should be taken to justify the
termination of employment. (Richard Rivera v.
Genesis Transport Service Inc., GR No. 215568,
August 3, 2015)
Q: Pacate was the owner of an abaca
plantation. Ligtas, accompanied by three (3)
unidentified men, were found harvesting
abaca at the plantation. Ligtas admitted to
harvesting 1,000 kilos of Abaca but claimed
that he was the plantation owner. According
to him, he had been a tenant of Pacate and
her late husband, Andres, since 1993. Andres
installed him as tenant of the 1.5 to 2
hectares of land involved.  known heirs, Crisostomo was set to reclaim
Ligtas filed a Complaint before the
Department of Agrarian Reform Adjudication
Board (DARAB), which ruled that Ligtas was a
bona fide tenant of the land. The RTC held
that the prosecution was able to prove the
elements of theft. The CA affirmed the ruling
of the RTC whereby the burden to prove the
existence of the tenancy relationship
belonged to Ligtas. It declared that Ligtas'
reliance on the DARAB Decision declaring
him as a bonafide tenant of the land is
irrelevant in the case at bar. Is the DARAB
Decision, finding petitioner Ligtas as tenant
of the land, conclusive or can be taken
judicial notice of in a criminal case for theft?
A: YES. A DARAB decision is conclusive and
binding on courts if supported by substantial
evidence. The issue of tenancy is generally a
question of fact. The existence of a tenancy
relationship is a legal conclusion based on facts
presented corresponding to the statutory
elements of tenancy. The findings of the DARAB
were supported by substantial evidence; hence,
to require petitioner to prove tenancy
relationship through evidence other than the
DARAB Decision and the testimonies of the
witnesses is absurd and goes beyond the
required quantum of evidence, which is
substantial evidence. 
Generally, administrative cases are independent
from criminal actions for the same act or
omission; thus, decisions in administrative cases
are not binding on criminal proceedings.
However, this case does not involve an
administrative charge stemming from the same
set of facts involved in a criminal proceeding.
This is not a case where one act results in both
criminal and administrative liability. The tenancy
relationship is merely a factor in determining
whether all the elements of theft were proven by
the prosecution. (Monico Ligtas v. People, GR No.
200751, August 17, 2015)
Q: Ismael and his brother Jose were the
registered owners of a parcel of riceland.
They enteered into a lease contract with
Hipolito over a portion of the riceland. The
contract was supposedly in effect until
Hipolito's death. As Hipolito died without any
possession and to take over cultivation of the
disputed portion. However, Victoria entered
the disputed portion and began cultivating it
without the knowledge and consent of
Crisostomo. Victoria insisted that he had
tenancy rights over the disputed portion. He
claimed that Hipolito was his uncle and that
even during the lifetime of Hipolito, it was he
who was doing farmwork on the disputed
portion with Crisostomo's knowledge. He
added that from the time Hipolito became
bedridden, it was he who performed all
duties pertaining to tenancy, including the
delivery of lease rentals and corresponding
shares in the harvest to Crisostomo. He
asserted that Crisostomo's act of receiving
lease rentals from him amounted to implied
consent, which gave rise to a tenancy
relationship between them. Is Victoria a bona
fide tenant of the disputed portion?
A: NO. Hipolito's status as the acknowledged
tenant did not clothe him with the capacity to
designate respondent as a tenant. Tenancy
relations cannot be an expedient artifice for
vesting in the tenant rights over the landholding
which far exceed those of the landowner. It
cannot be a means for vesting a tenant with
security of tenure, such that he or she is
effectively the landowner.
Even while agrarian reform laws are pieces of
social legislation, landowners are equally
entitled to protection. To hold that respondent is
the bona fide tenant of the disputed portion
would be to extend petitioner's dispossession for
a period much longer that he had originally
contemplated. It puts him at the mercy of a
person whom he recognized as a tenant. To hold
as such would be to permit agrarian reform laws
to be used as a convenient artifice for investing
in a supposed tenant rights that far exceed those
of the owner. (Ismael Crisostomo v. Martin
Victoria, GR No. 175098, August 26, 2015)
Q. Uniden contracted the services of
Nationwide Security to provide the former
security guard services. However, upon
exercise of the Regional Director’s
enforcement and visitorial powers it found
Uniden violated several labor standard laws.
Thus, the RD directed Nationwide Security
and Uniden liable to solidarily pay 40
security personnel including Ceprado, Sebial,
Olivar, Villegas, and Manato. Nationwide
Security filed a motion for reconsideration of
the order, which granted by the RD. On
appeal, the SOLE reversed the RD. It ruled
that Ceprado, Jr. et al. were deprived of their
right to due process for Nationwide Security’s
failure to serve the motion for
reconsideration to the former. Is the SOLE
correct?
A: YES. Motions for reconsideration not served
on the adverse party do not toll the running of
the reglementary period for filing an appeal.
Upon lapse of the reglementary period, the
judgment sought to be reconsidered becomes
immutable. Rule II, Section 19 of the Rules on the
Disposition of Labor Standards Cases in the
Regional Offices allows an aggrieved party to file
a motion for reconsideration of the Order of the
Regional Office. In this case, respondent filed a
Motion for Reconsideration of Regional Director
Martinez's April 19, 2001 Order. (Alejandro
Ceprado, Jr. v. Nationwide Security and Allied
Services, Inc., GR No. 175198, September 23, 2015)
Q. Manalo is a faculty member of the
Accountancy Department of Ateneo de Naga
University's College of Commerce and part-
time Manager of the Ateneo de Naga Multi-
Purpose Cooperative. The Grievance
Committee of the University found her in
“fraud in issuance of official receipts,
collection of cash without documented
remittance to the cooperative, use of
inappropriate forms of documents cash
receipts” and, thus, recommended his
dismissal”. Instead of dismissing Manalo, the
University President transferred Manalo to
teach Economics in another Department. Was
Manalo constructively dismissed?
A: NO. Transferring employees, to the extent that
it is done fairly and in good faith, is a valid
exercise of management prerogative and will not,
in and of itself, sustain a charge of constructive
dismissal. In this case, the acts committed by
Manalo run afoul from the principles of integrity
and objectivity governing ethics and education in
the accountancy profession as mandated by the
International Federation of Accountants.
Relevant as it is, ethical behavior takes on even
greater significance in the education and training
of individuals who are prospective members of
the profession. Professionals who concurrently
take on the role of educators act as gatekeepers
to the esteemed ranks of a profession or as
channels of skills and knowledge. (Jovito Manalo
v. Ateneo De Naga University, GR No. 185058,
November 9, 2015)
Q. On May 4, 2010 the Court of Appeals
ordered AIM to pay Limilingan and Leyco by
reason their illegal suspension, non-payment
of salaries, deprivation of medical benefits,
life insurance and other benefits. How should
we compute the proper legal interest rate of
the judgement?
A: In Nacar v. Gallery Frames the court ruled that
judgments that have become final and executory
prior to July 1, 2013, shall not be disturbed and
shall continue to be implemented applying the
rate of interest fixed therein. Thus, Limlingan
and Leyco are entitled to legal interest at the
following rates: 12% per annum computed from
July 25, 2011, the date of the finality of the Court
of Appeals' May 4, 2010 Decision, up to June 30,
2013, and 6% per annum from July 1, 2013 until
full satisfaction of the award. (Victor Limilingan
v. Asian Institute of Management, Inc., GR No.
220481, February 17, 2016)
FOR AUTHORIZED CAUSE
Q. Philippine Airlines filed a corporate
rehabilitation before the SEC. It alleged that
they have aging fleet and overly manned
workforce. The Rehabilitation Plan stated
that PAL “non-core” activities have the
potential to be sold which included the
Catering and the Maintenance and
Engineering Departments.
The company adopted a retrenchment
program presenting photocopied financial
statements for 1997, 1998, and 1999 to
establish the business losses it allegedly
suffered for approval. Due to the
retrenchment program Dawal, Concepcion,
Sinobago, and other affected employees were
dismissed from employment. However, when
PAL spun off the engineering and
maintenance facilities, it also created a new
engineering department, called the Technical
Services Department, allegedly "in
compliance with aviation regulations
requiring airline companies to maintain an
engineering department”. Is the dismissal
valid?
A: NO. The dismissal was neither redundancy
nor by means of a valid retrenchment.
Redundancy requires good faith in abolishing the
redundant position. To establish good faith, the
company must provide substantial proof that it is
overmanned. In General Milling Corporation v.
Viajar the court held that the act of hiring new
employees while firing the old ones "negates the
claim of redundancy. When PAL spun off the
engineering and maintenance facilities, it also
created a new engineering department called the
Technical Services Department. Moreover, after
it fired the affected employees, PAL offered to
rehire the same retrenched personnel as new
employees.
To establish retrenchment as a ground for
dismissal, the employer must meet the four (4)
criteria: (1) The losses expected should be
substantial and not merely de minimis; (2) The
substantial loss apprehended must be
reasonably imminent, as such imminence can be
perceived objectively and in good faith by the
employer; (3) Must be reasonably necessary and
likely to effectively prevent the expected losses;
and (4) Alleged losses if already realized, and the
expected imminent losses sought to be
forestalled, must be proved by sufficient and
convincing evidence
The employer has the burden of showing by clear
and satisfactory evidence that there are existing
or imminent substantial losses, and that
“legitimate business reasons justify
retrenchment.” Here, With PAL's quick access to
its own documents, as well as its heavy burden of
proving the validity of retrenchment, this court is
bewildered as to how, at every stage of the
proceedings, PAL failed to produce the original
or certified true copies of the evidence it
primarily relies on. Aware of Dawal, et al.'s
objection even at the beginning of this case, PAL
should have taken steps to dispel any doubts
surrounding the questioned photocopies. (PAL v.
Isagani Dawal, GR No. 173921, February 24,
2016)
FOR SEPARATION PAY
Q. Philippine Airlines filed a corporate
rehabilitation before the SEC. It alleged that
they have aging fleet and overly manned
workforce. The Rehabilitation Plan stated
that PAL “non-core” activities have the
potential to be sold which included the
Catering and the Maintenance and
Engineering Departments.
The company adopted a retrenchment
program. Due to this, Dawal, Concepcion,
Sinobago, were dismissed from employment
upon payment of separation evidenced by
Release, Waiver, and Quitclaim. Is Dawal et al.
barred from questioning the legality of their
dismissal?
A: NO. Accepting separation pay does not estop
Dawal, et al. from questioning their illegal
dismissal. The law looks at quitclaims and
releases with disfavor. Dawal, et al.'s non-waiver
of rights is further supported by the respective
disclaimers they wrote stating that they signed
the release and quitclaims without prejudice "to
the money claims filed" to "the favorable result
of the PAL-PALEA dispute, "or to the "rate of pay,
wage distortion claim cases with PAL.
Nevertheless, to prevent undue prejudice to PAL,
the separation pay already received by Dawal, et
al., "as consideration for signing the quitclaims"
must be subtracted from their individual
monetary awards. (PAL v. Isagani Dawal, GR No.
173921, February 24, 2016)
FOR CONSTRUCTION OF THE CBA
Q. Philippine Airlines filed a corporate
rehabilitation before the SEC. It alleged that
they have aging fleet and overly manned
workforce. PAL, thus, adopted a discuss among themselves the matter/s in issue.
retrenchment program citing Article XXIV,
Section 4 of the 1995-2000 PAL-PALEA CBA
and MOA dated November 2, 1996, "in case
PAL deems it necessary to reorganize its
corporate structure for the viability of its
operations by forming joint ventures and
spin-offs, PAL shall do so only after proper
consultation with PALEA within 45 days
before implementation of said
reorganization". PALEA held a general
election for its new officers. Headed by PALEA
President Jose T. Peñas III, the newly
proclaimed officers included Dawal as
Secretary. However, the result of the election
was contested.   Catering
No consultation meeting was held within 45
days prior to September 1, 2000 when it
dismissed its employees. PAL also turned
down the courtesy call visit of the newly
elected PALEA officers, the latter refused to
commence the consultation meeting "until
PAL management respects" their alleged
election. To make-up for this, PAL issued
primers to “address questions regarding the
spin-off”. PAL also allegedly conducted
ugnayan sessions with its employees to
inform them of the spin-off. Did PAL follow
the proper procedure in the CBA?
A: NO. A plain reading of the stipulation, the
proper consultation must begin specifically
within 45 days prior to the date of effectivity of
the spin-off. Forty-five days prior to September
1, 2000 begins on July 18, 2000, not earlier.
In this case, PAL’s supposed meeting with PALEA
on June 15, 1999 appeared questionable. First, it
was supported only by PAL’s self-serving
Minutes of the Meeting. Second, it was not held
within 45 days prior to September 1, 2000. Also
as found by the LA, PAL and PALEA could not
have possibly met within 45 days before
September 1, 2000 because PAL refused to
acknowledge the election of incoming PALEA
officers. Likewise, even assuming the meeting,
through a letter invitation, happened on March
30, 2000, this was still prior to July 18, 2000, and
is, thus, outside the 45-day consultation period.
The Court also held that primers do not
constitute the required consultations which
envision an actual meeting of the parties to
At best, they may be considered as supplements
to the consultation meetings" required by the
PAL-PALEA Collective Bargaining Agreement
(PAL v. Isagani Dawal, GR No. 173921, February
24, 2016)
FOR ULP
Q. Philippine Airlines filed a corporate
rehabilitation before the SEC. It alleged that
they have aging fleet and overly manned
workforce. The Rehabilitation Plan stated
that PAL “non-core” activities have the
potential to be sold which included the
and the Maintenance and
Engineering Departments.
The company adopted a retrenchment
program. Due to this program Dawal,
Concepcion, Sinobago, and other affected
employees were dismissed from employment
on September 1, 2000. However, when PAL
spun off the engineering and maintenance
facilities, it also created a new engineering
department, called the Technical Services
Department, allegedly "in compliance with
aviation regulations requiring airline
companies to maintain an engineering
department”. On September 7, 2000,
President of PAL-PALEA president submitted
list of proposals for the renewal of the CBA,
which would expire on 2000. Dawal et. al
charged PAL for ULP alleging interference
with right to self-organization, refusal to
bargain, and violation of the CBA. Did PAL
commit ULP?
A: NO. PAL did not discriminate Dawal, et.al.
because in terminating the services of those
working for the maintenance and engineering
facilities, PAL did not single out between the
union and non-union members. Instead, PAL
"phased out and sold" the whole department,
thereby severing the employment of all affected
personnel; hence, no interference was
committed.
Dawal, et al. cannot claim that they were
dismissed to prevent the renegotiation of the
CBA because they were dismissed on September
1, 2000, while the plea to bargain by the
president was made on September 7, 2000.
Moreover, PAL could not have validly negotiated
for the renewal of its Collective Bargaining
Agreement with PALEA due to a leadership crisis
in PALEA at that time. Hence, no refusal to
bargain was committed.
In Silva v. National Labor Relations Commission,
we held that for there to be unfair labor practice,
the violation of the Collective Bargaining
Agreement must be gross and must be related to
the Agreement's economic provisions. Here,
Dawal, et al. charge PAL of violating the
provisions on Job Security in the Collective
Bargaining Agreement, which are non-economic
in nature. Thus, PAL's acts do not constitute
unfair labor practice under Article 259(i) of the
Labor Code; hence, no violations of the CBA was
committed. (PAL v. Isagani Dawal, GR No.
173921, February 24, 2016)
Q: APT was a government entity created for
the purpose of conserving, provisional
managing, and disposing of assets that have
been identified for privatization or
disposition. NACUSIP/BISUDECO Chapter is
the exclusive bargaining agent for the rank-
and-file employees of Bicolandia. Bicolandia
had been incurring heavy losses which
prompted the former to obtain a loan from
Philippine Sugar Corporation and PNB,
secured by its assets and properties.
Sometime in 1992, the APT, pursuant to its
mandate to dispose government properties
for privatization, decided to sell the assets
and properties of Bicolandia. Subsequently,
APT issued a Notice of Termination to
Bicolandia’s employees, advising them that
their services would be terminated within 30
days. After the employees’ dismissal from
service, Bicolandia’s assets and properties
were sold Bicol Agro-Industrial. Thereafter,
several members of NACUSIP/BISUDECO
Chapter filed a Complaint charging APT,
Bicolandia, and Bicol Agro-Industrial with
unfair labor practice, union busting, and
claims for standard benefits. Are the
employees correct?
A: YES. Initially, petitioner was not liable for the
Union's claims for labor standard benefits. Its
acquisition of Bicolandia Sugar Development
Corporation's assets was not for the purpose of
continuing its business. It was to conserve the
assets in order to prepare it for privatization.
However, while petitioner per se is not liable for
private respondents' money claims arising from
an employer-employee relationship, it
voluntarily obliged itself to pay Bicolandia Sugar
Development Corporation's terminated
employees separation benefits in the event of the
Corporation's privatization. (Republic of the
Philippines by Privatization and Management
Office v. NLRC, GR No. 174747, March 9, 2016)
Q: Edna and Col. Otamias were married and
bore 5 children. Subsequently, the two
separated due to Col. Otamia’s alleged
infidelity. Thereafter, Edna filed a
Compalaint-Affidavit against Col. Otamias
before the Provost Marshall Division of the
AFP. Edna demanded monthly support from
Col. Otamias’ retirement benefit. Col. Otamias
executed an affidavit heeding Edna’s request,
therefore, waiving 50% of his salary and
pension benefits in favor of Edna and their
five children. The agreement was honored
until such time where the AFP-PGMC
informed Edna that a court order was
required for them to recognize the Deed of
Assignment. Is the AFP-PGMC correct?
A: NO. Under Section 31, Colonel Otamias'
retirement benefits are exempt from execution.
Retirement benefits are exempt from execution
so as to ensure that the retiree has enough funds
to support himself and his family. Therefore,
when Colonel Otamias executed the Deed of
Assignment, he effectively waived his right to
claim that his retirement benefits are exempt
from execution. The right to receive retirement
benefits belongs to Colonel Otamias. His decision
to waive a portion of his retirement benefits does
not infringe on the right of third persons, but
even protects the right of his family to receive
support. The Deed of Assignment executed by
Colonel Otamias was not contrary to law; it was
in accordance with the provisions on support in
the Family Code. Hence, there was no reason for
the AFP PGMC not to recognize its validity. (Edna
Mabugay-Otamias, et. al. v. Republic of the
Philippines, GR No. 189516, June 8, 2016)
Q: Unocal Philippines executed a Merger
Agreement with Blue Merger and Chevrolet.
Unocal merged with Blue Merger, and Blue
Merger became the surviving corporation.
Chevrolet is the parent corporation. The
employees of Unocal Philippines claim that
they are entitled to separation benefits as
afforded by the Collective Bargaining
Agreement. They claim that the merger
resulted in the cessation of operations of
Unocal and the implied dismissal of its
employees. Is the claim of the Union tenable?
A: NO. Merger is not one of the circumstances
where the employees may claim separation pay.
The only instances where separation pay may be
awarded to petitioner are: (a) reduction in
workforce as a result of redundancy; (b)
retrenchment or installation of labor-saving
devices; or (c) closure and cessation of
operations. The merger of Unocal Corporation
with Blue Merger and Chevron does not result in
an implied termination of the employment of
petitioner's members. Assuming respondent is a
party to the merger, its employment contracts
are deemed to subsist and continue by the
combined operation of the Corporation Code and
the Labor Code under the backdrop of the labor
and social justice provisions of the Constitution.
(Philippine Geothermal, Inc. Employees Union v.
Unocal Philippines, GR No. 190187, September 28,
2016)
Q: ABC Corporation offered, among other
benefits, a ₱l6.00/day wage increase to their
employees. To receive the benefits,
employees had to sign a waiver that said that
the new CBA Agreement shall only be
effective on January 1, 2008. Realizing that
the waiver was an unfair labor practice, some
members of XYZ union refused to sign. XYZ
Union and its members who refused to sign
the waivers filed a complaint for unfair labor
practices against ABC Corporation. Further,
XYZ Union members who did not sign the
waiver demanded a wage increase enjoyed by
those who signed. The Court found ABC Corp
guilty of unfair labor practice but denied the
claim for wage increase as there was no
provision in the existing CBA pertaining to
the said increase. XYZ Union appealed
alleging that the wage increase was
integrated in the salary of those who signed
the waivers and are currently receiving
₱32.00/day more than those who did not
sign. Should the wage increase given to the
employees who signed the waiver be
awarded to the employees who did not?
A: YES. Generally, the Collective Bargaining
Agreement controls the relationship between the
parties. Any benefit not included in it is not
demandable. However, in light of the peculiar
circumstances in this case, the requested wage
increase should be granted. Accordingly, it is
illegal to continue denying the petitioners the
wage increase that was granted to employees
who signed the waivers. To rule otherwise will
perpetuate the discrimination against employees
who did not sign. All the consequences of the
unfair labor practice must be addressed. The
grant of the ₱32.00/day wage increase is not an
additional benefit outside the Collective
Bargaining Agreement of 2009. By granting this
increase to those who did not sign, the Court is
eliminating the discrimination against them,
which was a result of respondent's unfair labor
practice. (Sonedco Workers Free Labor Union v.
Universal Robina Corporation, G.R. No. 220383,
July 5, 2017)
Q: Rodriguez was hired as a Restaurant
Supervisor by Spouses Javier. When the
restaurant closed, she was moved to do office
work and became an Administrative and
Finance Assistant to Estelita Javier. On August
25, 2009, Rodriguez filed a resignation letter
due to the increasing number of duties and
responsibilities. The resignation was not
accepted by the spouses. Rodriguez claims
that her experience worsened when Estelita
Javier would belittle and embarrass her in
the presence of co-workers. On September
29, she was late in opening the office after
going on her usual “pamalengke” for the
spouses. Estelita called her and scolded her
for the mistake. On September 29, 2009, she
wrote a letter to the spouses expressing her
grievances. On October 6, 2009, the spouses
accepted her resignation. The next day, she
filed a Complaint for constructive illegal
dismissal. Is Rodriguez correct?
A: NO. There is constructive dismissal when an
employer's act of clear discrimination,
insensibility or disdain becomes so unbearable
on the part of the employee so as to foreclose any
choice on his part except to resign from such
employment. It exists where there is involuntary
resignation because of the harsh, hostile and
unfavorable conditions set by the employer. We
have held that the standard for constructive
dismissal is "whether a reasonable person in the
employee's position would have felt compelled
to give up his employment under the
circumstances."
Petitioner's unequivocal intent to
relinquish her position was manifest when she
submitted her letters of resignation. The
resignation letters contained words of gratitude,
which could hardly come from an employee
forced to resign. These letters were reinforced by
petitioner's very own act of not reporting for
work despite respondents' directive. (Lourdes
Rodriguez v. Park N Ride Inc., et al., G.R. No.
222980, March 20, 2017)
Q: MKP, a labor organization representing the
employees of PLDT, filed notice of strike
before the NLRC. MKP charged PLDT of unfair
labor practice in implementing its
redundancy program. PLDT countered that
the redundancy was brought by consistent
decline for operator-assisted calls for both
local and international calls because of
cheaper alternatives like direct dialing
services, and the growth of wireless
communication warranting the dismissal of a
number of employees due to redundancy. Is
the dismissal of the employees legal?
A: YES. Redundancy is one of the authorized
causes for the termination of employment
provided for in Article 298 of the Labor Code.
While a declaration of redundancy is ultimately a
management decision in exercising its business
judgment, and the employer is not obligated to
keep in its payroll more employees than are
needed for its day to-day operations,
management must not violate the law nor
declare redundancy without sufficient basis.
Philippine Long Distance Telephone Company's
declaration of redundancy was backed by
substantial evidence showing a consistent
decline for operator-assisted calls for both local
and international calls because of cheaper
alternatives like direct dialing services, and the
growth of wireless communication.
(Manggagawa ng Komunikasyon sa Pilipinas v.
PLDT, G.R. No. 190389, April 19, 2017)
Q: Mac was employed as a part-time teacher
and comptroller of Elysen College. A
committee was created to formulate a new
ranking system for non-academic employees
for school year 2020-2021. He then directed
to arrange a salary adjustment schedule for
the new ranking system to the committee
organized. Later, he obtained his employee
ranking slip which showed his evaluation
score and the change of his rank from office
head to middle manager-level IV, this was
prepared however without prior approval
from the Human Resource Department. On
July 25, 2020, Elysen College notified Mac of
its decision to terminate his services for
serious misconduct and loss of trust and
confidence. Upon receipt of the termination
letter that reads "For this reason, you are
advised to explain or show cause why your
employment with Elysen College will not be
terminated for Serious Misconduct due to
intentional
misclassification/miscomputation of your
salary and some employees named
hereunder, thereby causing prejudice not
only to the school but also to said employees
as well", Mac immediately filed before
Executive Labor Arbiter. Was Mac illegally
dismissed?
A: NO. Mac was validly dismissed based on loss
of trust and confidence. Mac was not an ordinary
rank-and-file employee. His position of
responsibility on delicate financial matters
entailed a substantial amount of trust from
respondent. The preparation of the payroll is a
sensitive matter requiring attention to detail.
The alleged misconduct for loss of trust and
confidence is sufficient to warrant the dismissal
of fiduciary rank-and-file employees. However,
"mere existence of a basis for believing that [the]
employee has breached the trust [and
confidence] of [the] employer" is sufficient for
managerial employees.
A formal hearing only becomes mandatory in
termination cases when so required under
company rules or when the employee requests
for it. "To be heard" does not mean verbal
argumentation alone inasmuch as one may be
heard just as effectively through written
explanations, submissions or pleadings. In this
case, respondent complied with all the
requirements of procedural due process in
terminating petitioner's employment, it
furnished a show cause memo stating the specific
grounds for dismissal and required him to
answer the charges by submitting a written
explanation. (Yolando Bravo v. Urios College
(Now Father Saturnino Urios University), G.R. No.
198066, June 7, 2017)
Q: Pedro is a Filipino seafarer. Two weeks
after he commenced to work aboard the
vessel, he was brought to the ship doctor
when he slipped on a metal stairway, fell
down and hit his abdomen and chest on a
metal pipe and was diagnosed to have a
"sebaceous cyst to the right of the umbilicus."
Under a local anesthesia, his cyst was
removed, and the lesion was closed with
three (3) stitches. After 2 months, his
employer terminated his services and was
repatriated to the Philippines on July 6, 2010.
Pedro now seeks compensation for his
sebaceous cyst as an occupational disease. To
support his claim, he presented his Medical
Examination that he was "fit to work" before
the start of his employment, hence, the cyst
was caused by his employment. Is Pedro
entitled to disability benefits?
A: NO. A sebaceous cyst is not included under
Section 32 of the 2000 Philippine Overseas
Employment Administration Amended Standard
Terms and Conditions Governing the
Employment of Filipino Seafarers on Board
Ocean-Going Vessels. However, illnesses not
listed as an occupational disease are disputably
presumed to be work-related. Nevertheless,
seafarers must prove through substantial
evidence the correlation between their illness
and the nature of their work for their claim for
disability benefits to prosper. 
In this case, Pedro failed to substantiate his claim
that his cyst was either work-related or work-
aggravated. Also, his Pre-Employment Medical
Examination  stating that he was “fit to work”
cannot be relied upon to reflect a "seafarer's true
state of health" since it is not exploratory and
may just disclose enough for employers to decide
whether a "seafarer is fit for overseas
employment." Due to the nature of a Pre-
Employment Medical Examination, it is possible
that Madridejos' sebaceous cyst was not detected
prior to his employment. Hence, Pedro is not
entitled to disability benefits. (Mario Madridejos
v. NYK-FIL Ship Management, Inc., G.R. No.
204262, June 7, 2017)
Q: Gonzales, while on board the general cargo
vessel Star Florida, experienced "shortness of
breath, pain in his left leg, fatigue, fever and
headaches." The following month, his past
symptoms returned with the added symptom
of black tarry stools. He was initially
diagnosed with "pancytopenia suspect
aplastic anemia." This caused his further
medical attention as Gonzales was
repatriated in the Philippines. The company
physicians opined that Gonzales' leukemia
was not work-related. He sought a second
opinion from an independent physician, Dr.
Emmanuel Trinidad, who certified that his
leukemia was work-related. Gonzales
claimed for disability benefits against Grieg
Philippines, Inc. but denied the same on the
ground that Gonzales was not able to
substantially prove the relation between his
illness and his former position as an Ordinary
Seaman. Can Gonzales claim disability
benefits against Grieg Philippines, Inc.?
A: YES. Settled is the rule that for illness to be
compensable, it is not necessary that the nature
of the employment be the sole and only reason
for the illness suffered by the seafarer. It is
sufficient that there is a reasonable linkage
between the disease suffered by the employee
and his work to lead a rational mind to conclude
that his work may have contributed to the
establishment or, at the very least, aggravation of
any pre-existing condition he might have had.
(Magsaysay Maritime Services v. Lauret, G.R. No.
195518, March 20, 2013)
Gonzales was able to satisfy the
conditions under the Section 32-A of the 2000
Philippine Overseas Employment
Administration-Standard Employment Contract
and establish a reasonable linkage between his
job as an Ordinary Seaman and his leukemia.
Gonzales provided his functions as an Ordinary
Seaman aboard Star Florida. Among others, his
tasks included removing rust accumulations and
refinishing affected areas of the ship with
chemicals and paint to retard the oxidation
process. This meant that he was frequently
exposed to harmful chemicals which could have
also contributed to Gonzales' leukemia. It is also
not disputed that he contracted leukemia only
while he was onboard Star Florida since he was
certified to be fit for sea duty prior to boarding
and his leukemia was not genetic in nature.
(Grieg Philippines, Inc. v. Michael John Gonzales,
G.R. No. 228296, July 26, 2017)
Q: National Power Corporation Employees
Consolidated Union (NECU) and the National
Power Corporation Employees and Workers
Union (NEWU) filed a petition for Mandamus
with the RTC praying that the National Power
Corporation (NAPOCOR) be ordered to
release the Cost of Living Allowance (COLA)
and Amelioration (AA) allegedly withheld
from them from  July 1, 1989 to March 19,
1999. They believed that they were among
the government employees whose COLA and
AA were not factually integrated into their
basic salary upon the implementation of
Republic Act No. 6758. In particular, they
distinguish NAPOCOR workers into three (3)
categories. The first category includes
workers already employed when Republic
Act No. 6758 took effect and whose COLA and
AA were integrated into their basic salaries
only up to 1993. The second category covers
those hired after Republic Act No. 6758 took
effect and whose COLA and AA were allegedly
deducted from 1989 to 1999. The third
category consists of employees hired after
the effectivity of Republic Act No. 7648 and
whose COLA and AA were allegedly deducted
from 1994 to 1999. Should NAPOCOR be
ordered to release the COLA and AA allegedly
withheld from NECU and NEWU?
A:  NO. The implementation of Republic Act No.
6758 resulted in the integration of all allowances
previously received, including Cost of Living
Allowance (COLA) and Amelioration
Allowance(AA), into the basic standardized
salary. When a government entity ceases to be
covered by Republic Act No. 6758, the new
position classification and compensation plan
must also include all allowances previously
received in the basic salary, in line with the
principle of non-diminution of pay. In this case,
COLA and AA are already deemed integrated into
the standardized salaries of the NAPOCOR
employees from July 1, 1989 to December 31,
1993. Further, upon the implementation of
Republic Act No. 7648, NAPOCOR workers were
covered by a new compensation plan. The new
compensation plan under Republic Act No. 7648
already incorporated all benefits previously
integrated, including the COLA and AA Thus, in
order to conclude that the NAPOCOR employees
were not able to receive their COLA and AA upon
the implementation of the New Compensation
Plan, it must first be determined whether its
implementation resulted in the diminution of
their salaries and benefits. As it stands, NECU
and NEWU have failed to prove that their COLA
and AA were factually deducted from their basic
pay as affected employees suffered no
diminution in their compensation upon the
implementation of the New Compensation Plan.
(Republic of the Philippines v. Hon. Luisito G.
Cortez, G.R. No. 187257, August 8, 2017)
Q: Perea was engaged by respondent Elburg
Shipmanagement Philippines, Inc. (Elburg) as
a fitter for a period of 9 months. Perea, while
on board MV Lemno, experienced difficulty in
breathing while repairing a pipe. A few days
later, Perea was welding when the oxygen
and acetylene torch he was holding exploded.
He hit his left shoulder and twisted his
fingers in trying to avoid the explosion. He
was diagnosed to be suffering from "Cubital
Tunnel Syndrome (mainly due to swelling
and bleeding), soft, tissue injury of the right
elbow." He was soon repatriated to the
Philippines. Upon arrival in Manila, Perea
underwent laboratory examinations and
other medical procedures, where he was seen
by a company-designated physicians. They
stated in a letter that the cause of
hypertension was not work-related and
opined that Perea's estimated length of
treatment would be approximately three (3)
to four (4) months. Perea consulted Dr.
Antonio C. Pascual for a second opinion who
diagnosed him with "Uncontrolled
Hypertension [and] Coronary Artery
Disease." Perea claimed for disability benefits
against Elburg but denied the same on the
ground that while Section 32-A of the POEA
Contract provided that hypertension may be
compensable, this was applicable only if it
caused "impairment of function[s] of body
organs like kidneys, heart and brain,
resulting in permanent disability. Perea's
hypertension did not impair the functions of
his organs, as evidenced by Dr. Hao-Quan and
Dr. Lim's medical reports. Is Perea’s illness
compensable?
A: NO. The doctor who have had a personal
knowledge of the actual medical condition,
having closely, meticulously and regularly
monitored and actually treated the seafarer's
illness, is more qualified to assess the seafarer's
disability.
As between the findings made by the company-
designated physicians who conducted an
extensive examination on the petitioner and Dr.
Pascual who saw petitioner on only one (1)
occasion and did not even order that medical
tests be done to support his declaration that
petitioner is unfit to work as a seaman, the
company-designated physicians' findings that
petitioner has been cleared for work should
prevail. (Pedro Perea v. Elburg Shipmanagement
Philippines, G.R. No. 206178, August 9, 2017)
Q: Manansala’s services were engaged by
Marlow Navigation Phils., Inc, for him to serve
as a fitter on board the vessel M/V Seaboxer.
Before boarding the vessel, Manansala
underwent a Pre-Employment Medical
Examination (PEME). In his examination,
Manansala was required to disclose
information regarding all existing and prior
medical conditions. Manansala's examination
certificate indicates that he denied having
hypertension and diabetes, specifically
answering "NO" when asked about
hypertension and diabetes mellitus. On May
30, 2010, while on board the M/V Seaboxer,
Manansala suffered a stroke. Because of this,
Manansala was repatriated on June 8, 2010.
He was confined at the De Los Santos Medical
Center from June 10, 2010 to June 23, 2010,
under the primary care of company-
designated physician, Dr. Teresita Barrairo
(Dr. Barrairo). While under Dr. Barrairo's
care, he "repeatedly denied that he had any
past history of diabetes and hypertension." 
On October 21, 2010, Manansala filed a
Complaint against the respondents for total
and permanent disability benefits, as well as
damages and attorney's fees. Two (2) months
after he filed his Complaint, Dr. Amado San
Luis (Dr. San Luis), issued a medical opinion
stating that Manansala must be considered
permanently disabled. The same opinion
indicated that Manansala admitted to having
had a long history of hypertension and
diabetes. He even admitted to taking
Enalapril and Metformin as maintenance
medications.  Whether or not petitioner
Manansala is entitled to total and permanent
disability benefits occasioned by work-
related illnesses?
A: NO, Manansala is not entitled to total and
permanent disability benefits. Section 20 (E) of
the POEA-SEC bars the compensability of
disability arising from pre-existing illness when
attended by an employee’s fraudulent
misrepresentation. Petitioner knowingly and
fraudulently misrepresented himself as not
afflicted with hypertension and diabetes during
his PENE and after repatriation while being
treated by the company-designated physician.
(Antonio Manansala v. Marlow Navigation Phils.,
Inc., G.R. No. 208314, August 23, 2017)
Q: On February 28, 2006, Magsaysay
Maritime Corporation (Magsaysay), the local
manning agent of Princess Cruise Lines,
Limited, hired Bernardine De Jesus as an
Accommodation Supervisor for the cruise
ship Regal Princess. On March 9, 2006,
Bernardine boarded Regal Princess and he
eventually disembarked 10 months later, or
on January 16, 2007, after his contract of
employment ended. Bernardine was soon
diagnosed with Aortic Aneurysm and on
March 15, 2007, he had a coronary
angiography. On March 21, 2007, he
underwent a Left Axillofemoral Bypass. He
died on March 26, 2007. Cynthia,
Bernardine’s widow claimed that her
husband suffered chest pains while he was
still aboard the Regal Princess. She claimed
that he had reported his condition but he was
not provided with medical attention.
Furthermore, he had also asked for medical
attention upon his repatriation, but his
request was once again denied. Whether or
not Bernardine’s widow is entitled to death
benefits?
A: YES, Bernardine's widow is entitled to death
benefits. Section 20 (A) of the POEA-SEC requires
that for a seafarer to be entitled to death
benefits, he must have suffered a work-related
death during the term of his contract.  Airline Pilots Association of the Philippines
However, Section 32-A of the POEA-
SEC acknowledges the possibility of
"compensation for the death of the seafarer
occurring after the employment contract on
account of a work-related illness" as long as the
following conditions are met:
1. The seafarer's work must involve the
risks described herein;
2. The disease was contracted as a result of
the seafarer's exposure to the described
risks;
3. The disease was contracted within a
period of exposure and under such other
factors necessary to contract it;
4. There was no notorious negligence on the
part of the seafarer.  not yet 60 years old when he retired on
Both labor tribunals found that Bernardine
first experienced chest pains while he was still
onboard the cruise ship, i.e., during the term of
his employment contract. It was likewise
established that while Bernardine requested
medical attention when he started to feel ill and
upon his repatriation, his requests were
repeatedly ignored.  the reduction of retirement benefits. NLRC
This Court concurs with the Labor Arbiter's
observation that it was improbable for
Bernardine to have developed and died from a
cardio-vascular disease within the two (2) short
months following his repatriation. (Magsaysay
Maritime Corporation v. Cynthia De Jesus, G.R. No.
203943, August 30, 2017)
Q: Cristobal became a pilot for respondent
PAL on October 16, 1971. In May 1998, in line
with a downsizing program of PAL, Cristobal
applied for leave without pay to enter into a
four (4)-year contract with EVA Air. Cristobal
advised PAL of his intent to retire. In
response, PAL advised him that he was
deemed to have lost his employment status
on June 9, 1998. Thus, on May 12, 1999,
Cristobal filed a complaint with the NLRC.
Labor Arbiter found Cristobal's dismissal
illegal. On the matter of retirement benefits,
the Labor Arbiter noted PAL's claim that
Cristobal could only be entitled to a
retirement pay of P5,000.00 per year,
pursuant to the Philippine Airlines, Inc.-
(PAL-ALPAP) Retirement Plan of 1967.
However, he found that Cristobal's
retirement benefits should not be less than
the amount provided under the law. He is
entitled to a retirement pay in the amount of
P1,575,964.30. NLRC affirmed the Labor
Arbiter Decision. 
Cristobal filed a Motion for Partial
Reconsideration while PAL also filed a
motion for reconsideration, claiming that it
was error to find that Cristobal was illegally
dismissed and to base his retirement benefits
on Article 287 of the Labor Code. NLRC
agreed that Cristobal's retirement benefits
should not be computed in accordance with
Article 287 of the Labor Code as Cristobal was
March 10, 1999. Accordingly, complainant is
only entitled to receive retirement benefits
from the 1967 PAL-ALPAP Retirement Plan in
an amount equal to P5,000.00 for every year
of service. 
Cristobal filed his Motion for
Reconsideration, seeking reconsideration of
denied Cristobal's Motion for
Reconsideration, deeming it a second motion
for reconsideration of its May 31, 2011
Decision. Whether or not the Motion for
Reconsideration filed by petitioner Angelito
L. Cristobal assailing the NLRC May 31, 2011
Decision was a prohibited second motion for
reconsideration?
A: NO. The Amended Decision is an entirely new
decision which supersedes the original decision,
for which a new motion for reconsideration may
be filed again. Here, the National Labor Relations
Commission May 31, 2011 Decision substantially
modified its September 30, 2010 Decision. Thus,
petitioner was not precluded from seeking
reconsideration of the new decision of the
National Labor Relations Commission, and it was
clearly an error for the Court of Appeals to find
that petitioner's petition for certiorari was filed
out of time on that ground. (Angelito Cristobal v.
Philippine Airlines, Inc. and Lucio Tan, G.R. No.
201622, October 4, 2017)
Q: Mabunay entered into a contract of
employment with Sharpe Sea, as an oiler for a
period of nine (9) months aboard M/V Larisa.
On April 14, 2009, Mabunay boarded M/V
Larisa. The following day, Mabunay slipped
and hit his back on the purifier, while he was
cleaning the second floor of the engine room.
He lost consciousness when he fell and when
he awoke, his back was numb and he had
difficulty getting up. Despite the persistent
pain in his back and numbness in his legs,
Mabunay continued working from April 16,
2009 to April 18, 2009, until Chief Engineer
Manuel De Leon allowed him to have a
medical checkup when the ship docked in
Nanjing, China. He was declared unfit to work
by his attending physician. On April 29, 2009,
Mabunay was medically repatriated to
Manila.  Magsaysay Maritime Corp. v. Cruz emphasized
On April 30, 2009, Mabunay reported to
Sharpe Sea's office and was told to report to
Dr. Cruz, a company-designated physician. He
was diagnosed with "Cervical Spondylosis,
C4C5; Thoracolumbar Spondylosis; and Mild
chronic compression fracture of T12 & L1
vertebral bodies." Because Mabunay was not
responding to physical therapy, Dr. Cruz
recommended that Mabunay undergo a
discectomy. On November 24, 2009, Mabunay
underwent surgery and was observed that he
"tolerated the procedure well."  submission of the disability rating into evidence,
Mabunay filed a complaint against Sharpe
Sea, Monte Carlo, and Florem for the payment
of his medical expenses, total disability
benefits, damages, and attorney's fees.
Mabunay sought the opinion of Dr.
Raymundo, an orthopedic surgeon, who
opined that he was unfit to work as a seaman
in his present condition.  Q: Leron was hired as a weaver by Demex
Labor Arbiter ruled in Mabunay's favor and
directed Sharpe Sea to pay him permanent
and total disability benefits.  It rejected
Sharpe Sea's claim that its company-
designated physicians assessed Mabunay
with a disability rating of Grade 8 since it was
not supported by the records.  The NLRC
upheld the Labor Arbiter's finding' that the
records were bereft of evidence to support
Sharpe Sea's claim that its company-
designated physicians gave Mabunay a
disability rating of Grade 8. On November 29,
2011, the NLRC modified its decision by
reducing the award of US$60,000.00 it earlier
granted to Mabunay, to US$16,795.00,
corresponding to a Grade 8 disability rating. 
The NLRC noted that Sharpe Sea attached a
medical report dated August 18, 2009 from
Dr. Cruz, which supported its claim that a
company-designated physician had
diagnosed Mabunay with a Grade 8 disability.
Whether or not Mabunay is entitled to
permanent and total disability benefits?
A: YES. With the company-designated
physicians' failure to issue either a fit-to-work
certification or a final disability rating within the
prescribed periods, respondent's disability was
rightfully deemed to be total and permanent.
that a company-designated physician is expected
to come up with a definite assessment of a
seafarer's fitness or lack of fitness to work or to
determine the seafarer's degree of disability
within a period of 120 or 240 days from
repatriation. Clearly, Dr. Cruz, Dr. Castillo, or any
other company-designated physician failed to
issue respondent either a fit-to-work
certification or a final disability rating after his
operation and before the lapse of 240 days from
his repatriation. Nonetheless, even if this Court
accepted petitioners' explanation on the belated
it is worthy to note that Dr. Cruz only issued an
interim disability rating. Magsaysay Maritime
Corp. stated that an interim disability grading is
merely an initial prognosis and does not provide
sufficient basis for an award of disability
benefits. (Sharpe Sea Personnel, Inc. v. Macario
Mabunay, Jr., G.R. No. 206113, November 6, 2017)
Rattancraft, Inc. In June 2006, Leron was
dismissed by Demex's foreman. Before he
was dismissed from service, he was given a
memorandum stating that the dining chair he
had previously weaved for export to Japan
was rejected. For this reason, Demex
expressed that it would no longer avail of his
services. On June 28, 2006, Leron did not
report for work. The next day, he filed a
complaint against Demex for illegal dismissal.
Meanwhile, Demex construed Leron's failure
to report to work as an absence without
leave. Despite having received two (2) notices
from Demex requiring him to return to work,
Leron did not resume his post. Later, Leron
received a third notice from Demex informing
him of its decision to terminate his services
on the ground of abandonment. Was Leron
validly dismissed from employment on the
ground of abandonment?
A: NO. Mere failure to report to work is
insufficient to support a charge of abandonment.
The employer must adduce clear evidence of the
employee's "deliberate, unjustified refusal . . . to
resume his [or her] employment,'' which is
manifested through the employee's overt acts.
Respondent filed an illegal dismissal case against
petitioners the day after he was
unceremoniously dismissed by his superiors.
There was no unequivocal intent to abandon.
Respondent's non-compliance with the return-
to-work notices and his alleged act of crumpling
the first return-to-work notice are equivocal acts
that fail to show a clear intention to sever his
employment. Strained relations caused by being
legitimately disappointed after being unfairly
treated could explain the employee's hesitation
to report back immediately. If any, his actuations
only explain that he has a grievance, not that he
wanted to abandon his work entirely. (Demex
Rattancraft, Inc. v. Rosalio Leron, G.R. No. 204288,
November 8, 2017)
Q: In September 1986, Padilla was hired by
respondent Airborne Security Service, Inc. as
a security guard wherein he rendered
continuous service until June 2009, when he
was relieved from his post and was advised to
wait for his re-assignment order. He received
a letter from Airborne directing him to report
for assignment and deployment but when he
called its office, he was told that he had no
assignment yet. He received another letter
asking him to report to its office. However,
upon inquiring on the status of his
deployment, he was told that Airborne was
having a hard time finding an assignment for
him since he was already over 38 years old.
Padilla added that he was advised by
Airborne's personnel to resign, but he
refused. In December 2009, when he
reported to the office to collect his 13th
month pay, he was again persuaded to hand
in his resignation letter. Still not having been
deployed or re-assigned, on February 23,
2010, Padilla filed his Complaint for illegal
dismissal. Was Padilla constructively
dismissed?
A: YES. The practice of placing security guards
on "floating status" or "temporary off-detail" is a
valid exercise of management
prerogative. Jurisprudence has settled that the
period of temporary off-detail must not exceed
six (6) months. Beyond this, a security guard's
floating status shall be tantamount to
constructive dismissal.
Therefore, a security guard's-employer must give
a new assignment to the employee within six (6)
months. This assignment must be to a specific or
particular client. "A general return-to-work
order does not suffice." (Macario Padilla v.
Airborne Security Service, Inc., G.R. No. 210080,
November 22, 2017)
 
Q: As a further defense, respondent Airborne
Security Service, Inc. add that it was
petitioner Padilla who abandoned his work.
Was there intent on the part of Padilla to
abandon his work?
A: NO. Petitioner's conduct belies any intent to
abandon his work. To the contrary, it
demonstrates how he took every effort to retain
his employment.  Considering petitioner's 24
years of uninterrupted service, it is highly
improbable that he would abandon his work so
easily. Equally belying petitioner's intent to
abandon his work is his immediate filing of a
Complaint for illegal dismissal. This was only
eight (8) months after he was placed on floating
status. Taking the totality of circumstances into
consideration, this Court is unable to conclude
that petitioner abandoned his work. (Macario
Padilla v. Airborne Security Service, Inc., G.R. No.
210080, November 22, 2017)
Q: UDMC and its rank-and-file employees had
a CBA, under which rank-and-file employees
were entitled to optional retirement benefits.
On retirement pay, the CBA provided that the
center shall grant each employee retirement
and severance pay in accordance with law. It
shall also continue its present policy on
optional retirement. Under the optional
retirement policy, an employee who has
rendered at least 20 years of service is
entitled to optionally retire. In addition to the
retirement plan, employees are also provided
insurance, with United Doctors Medical
Center paying the premiums. The employees'
family members would be the beneficiaries of
the insurance. Later on, Cesario Bernadas, a
UDMC utility died from a freak accident while
working in a doctor’s residence. During his
time of death, Cesario has been working with
UDMC for 23 years. Is Cesario Bernadas
entitled to receive optional retirement
benefits despite his untimely death?  Executive Vice President for Marketing.
A: YES. The terms and conditions of a CBA
"constitute the law between the parties."
However, this CBA does not provide for the
terms and conditions of the "present policy on
optional retirement." Therefore, doubt arises as
to what petitioner's optional retirement package
actually entails. It is settled that doubts must be
resolved in favor of labor. Furthermore,
petitioner's optional retirement plan is premised
on length of service, not upon reaching a certain
age. It rewards loyalty and continued service by
granting an employee an earlier age to claim his
or her retirement benefits even if the employee
has not reached his or her twilight years. It
would be the height of inequity to withhold
respondent Cesario's retirement benefits despite
being qualified to receive it, simply because he
died before he could apply for it. In any case, the
CBA does not mandate that an application must
first be filed by the employee before the right to
the optional retirement benefits may vest. Thus,
this ambiguity should be resolved in favor of the
retiree. (United Doctors Medical Center v. Cesario
Bernadas, G.R. No. 209468, December 13, 2017)
Q: Several Novo Jeans employees alleged
illegal dismissal against the respondents. On
the other hand, respondents allege that said
employees abandoned their work and that
there was no dismissal since they sent
petitioners a First Notice of Termination of
Employment- asking them to show cause why
they should not be dismissed for their
continued absence from work. Later on, it
was proven that no evidence has been
presented proving that each and every
petitioner received a copy of the First Notice
of Termination of Employment. There is
likewise no proof that petitioners abandoned
their employment. Were the petitioners
illegally dismissed?
A: YES. Where both parties in a labor case have
not presented substantial evidence to prove their
allegations, the evidence is considered to be in
equipoise. In such a case, the scales of justice are
tilted in favor of labor. Thus, petitioners are
hereby considered to have been illegally
dismissed. (Charlie Hubilla v. HSY Marketing Ltd.,
G.R. No. 207354, January 10, 2018)
Q: Pascua was employed by Bankwise as its
However, as part of the merger or trade-off
agreement with Philippine Veterans Bank, he
was later informed by Roberto A. Buhain
(Buhain), President of Bankwise, that he
should tender his resignation. Instead of
tendering his resignation, Pascua wrote a
letter dated February 7, 2005, wherein he
pleaded, among others, that he stay in office
until the end of the year. Vicente Campa, a
director of Bankwise, later told him that it
was imperative that he submit his resignation
and assured his continued service with
Philippine Veterans Bank. Based on Campa's
assurance, Pascua tendered his resignation
on February 22, 2005.
Pascua allegedly inquired from Buhain how
his money claims would be paid in view of
"the passive attitude" of the banks. Buhain
allegedly assured him that he already sought
a meeting with Campa on the matter.
However, due to the inaction of Philippine
Veterans Bank and Bankwise, Pascua sent
Buhain a letter dated April 13, 2005,
demanding the early settlement of his money
claims. The demand was not heeded. Pascua
then filed a Complaint for illegal dismissal.
Was Pascua constructively dismissed?
A: NO. The employer has the burden of proving,
in illegal dismissal cases, that the employee was
dismissed for a just or authorized cause. Even if
the employer claims that the employee resigned,
the employer still has the burden of proving that
the resignation was voluntary. It is constructive
dismissal when resignation "was made under
compulsion or under circumstances
approximating compulsion, such as when an
employee's act of handing in his [or her]
resignation was a reaction to circumstances
leaving him [or her] no alternative but to
resign."  Pelayo, G.R. No. 212003, February 28, 2018)
However, Pascua's resignation letter, however,
was unconditional. It contained no reservations
that it was premised on his subsequent claim for
severance pay and other benefits. In this
instance, Pascua is not considered to have been
constructively dismissed. Pascua's third letter
likewise indicates that he has already accepted
the consequences of his voluntary resignation
but that it would be subject to the payment of
severance pay. However, his claim for severance
pay cannot be granted. (Perfecto Pascua v. Bank
Wise, Inc., and Philippine Veterans Bank, G.R. No.
191460, January 31, 2018)
Q: Pelayo was employed by Sulpicio Lines as
an accounting clerk at its Davao City branch
office. As accounting clerk, her main duties
were to process and prepare vouchers and
checks for payments. Later on, Sulpicio Lines
uncovered several anomalous transactions in
its Davao City branch office. There were
apparent double disbursements and
alterations in some checks released. Sulpicio
Lines served on Pelayo a memorandum
requiring her to submit a written explanation
concerning the anomaly and was made to
appear to Sulpicio Lines’ main office in Cebu.
Subsequently, Sulpicio Lines also placed
Pelayo on preventive suspension for 30 days
and sought the assistance of the National
Bureau of Investigation (NBI), which asked
Pelayo to appear before it. Instead of
responding to Sulpicio Lines' memorandum
or appearing before NBI, Pelayo filed a
Complaint for constructive dismissal. Was
Pelayo Constructively dismissed?
A:  NO. Not every inconvenience, disruption,
difficulty, or disadvantage that an employee must
endure sustains a finding of constructive
dismissal." It is an employer's right to investigate
acts of wrongdoing by employees. Employees
involved in such investigations cannot ipso facto
claim that employers are out to get them. Their
involvement in investigations will naturally
entail some inconvenience, stress, and difficulty.
However, even if they might be burdened - and,
in some cases, rather heavily so - it does not
necessarily mean that an employer has
embarked on their constructive dismissal.
(Philippine Span Asia Carriers Corp. v. Heidi
Q. In December 2010, Ebuenga was hired by
Southfield Agencies as a chief cook aboard
Wilhemsen Ship Management Holding vessel.
In February 2011, about two (2) months into
his engagement, Ebuenga wrote a letter
asking that he be repatriated as soon as
possible "to attend to a family problem." It
was granted and Ebuenga was repatriated.
Without consulting Southfield’s designated
physician, Ebuenga underwent Magnetic
Resonance Imaging and was revealed that he
was afflicted with Multilevel Disk Dessication
and was advised to undergo physical therapy.
He underwent physical therapy sessions and
thereafter was issued with a Disability
Report, finding him to be permanently
disabled and no longer fit to work as a
seafarer. Consequently, he filed a complaint
for permanent disability benefits. Southfield
denied Ebuenga’s claim for disability benefits
because Ebuenga failed to undergo the
requisite post-employment medical
examination with company-designated
physician. Ebuenga contends that he could
not have forfeited his claims as Southfield
refused to have the company-designated
physician examine him. Is Ebuenga entitled to
permanent disability benefits?
A. NO. Section 20(B) of the POEA-SEC
established the procedures of assessing claims
for disability benefits. It mandates seafarers to
see a company-designated physician for a post-
employment medical examination, which must
be done within three (3) working days from their
arrival. Failure to comply shall result in the
forfeiture of the right to claim disability benefits.
For disability to be compensable under Section
20(B) of the 2000 POEA-SEC, two elements must
concur:
that illness or injury must be work-related; and  1. that the retrenchment is reasonably
that the work-related illness or injury must have
existed during the term of the seafarer’s
employment contract.
To be work-related is to stay that there is a
“reasonable linkage between the disease suffered
by the employee and his work.” Section 32-A
paragraph 1 of the POEA-SEC, thus, requires the
satisfaction of all of its listed general conditions
“for an occupational disease and the resulting
disability or death to be compensable”. (Ariel A.
Ebuenga v. Southfield Agencies, Inc., et. al, G.R. No.
208396, March 14, 2018)
Q. Dr. Pascua’s services as school physician
was engaged by La Consolacion College in
2000 where she started working as part-time
before serving full-time from 2008. In 2011,
Pascua received a memo inviting her to
discuss “working condition” and during the
said meeting was handed a termination of
employment letter explaining that due to the
current financial situation of La Consolacion
caused by the decrease in enrollment, the
Board of Trustees advised to downsize the
health services staff. Pascua wrote a letter
pointing out that the part-time school
physician should have been considered for
dismissal first. She also noted that rather
dismissing her outright, La Consolacion could
have asked her to revert to part-time status
instead. Sr. Mora, La Consolacion’s president,
answered Pascua’s queries explaining that
Pascua in particular was retrenched because
her position, the highest paid in the health
services, was dispensable and that since the
purpose of the downsizing was to reduce
payroll costs, the employees with the highest
rates of pay would be the first to be
retrenched, if their services could be
dispensed with. For this reason, Pascua was
terminated. Is Pascua’s retrenchment valid?
A. NO. The Labor Code recognizes retrenchment
as an authorized cause for terminating
employment. While a legitimate business option,
retrenchment may only be exercised in
compliance with substantive procedural
requisites. As to the substantive requisites, an
employer must show:
necessary and likely to prevent business
losses which, if already incurred, are not
merely de minimis, but substantial,
serious, actual and real, or if only
expected, are reasonably imminent as
perceived objectively and in good faith by
the employer;
2. that it exercises its prerogative to
retrench employees in good faith for the
advancement of its interest and not to
defeat or circumvent the employees’
right to security of tenure;
3. that it used fair and reasonable criteria in
ascertaining who would be dismissed
and who would be retained among the
employees, such as status, efficiency,
seniority, physical fitness, age, and
financial hardship for certain workers.
La Consolacion’s failure was non-compliance
with the third substantive requisite of using fair
and reasonable criteria that considered the
status and seniority of the retrenched employee.
La Consolacion’s disregard of Pascua’s seniority
and preferred status relative to a part-time
employee indicates its resort to an unfair and
unreasonable criterion for retrenchment. (La
Consolacion College of Manila, et. al. v. Virginia
Pascua, G.R. No. 214744, March 14, 2018)
Q: Remoticado was absent for fourteen (14)
days without an official leave. He then
informs Nielo, HR officer that he was
resigning due to personal reasons. After
receiving his final pay, he protested that he
was entitled to separation pay computed at
two (2) months for his services for two (2)
years. Nielo averred that he could not be
entitled to separation pay considering that he
voluntarily resigned. Remoticado then files a
complaint for illegal dismissal claiming that
he was told to stop reporting for work due to
a "debt at the canteen" and thereafter was
prevented from the company’s premises. Was
there an illegal dismissal?
A: NO. There can be no illegal termination when
there was no termination. Before the employer
must bear the burden of proving that the
dismissal was legal, the employee must first
establish by substantial evidence the fact of his
dismissal from service. If there is no dismissal,
then there can be no question as to the legality or
illegality thereof. Petitioner insists on his version
of events, that is, that on December 23, 2010, he
was told to stop reporting for work on account of
his supposed indebtedness at the canteen. This
bare insistence, however, is all that petitioner
has. He failed to present convincing evidence.
(Renante Remoticado v. Typical Construction
Trading Corp, G.R. No. 206529, April 23, 2018)
Q: Malcaba has been employed with
ProHealth since it started in 1997. He was
initially the Vice President for Sales until he
became the President in 2005. Malcaba
alleged that Del Castillo, the Chair of the
Board of Directors and Chief Executive
Officer, did acts that made his job difficult. He
asked to take a leave on October 23, 2007.
When he attempted to return on November 5,
2007, Del Castillo insisted that had already
resigned and had his things removed from his
office. He attested that he was paid a lower
salary in December 2007 and his benefits
were withheld. On January 7, 2008, Malcaba
tendered his resignation effective February 1,
2008.  during which the disability assessment should
Does the Labor Arbiter or the National Labor
Relations Commission have a jurisdiction
over petitioner Malcaba’s termination
dispute considering the allegation that he
was a corporate officer, and not a mere
employee?
A: NO. Under the Labor Code, the Labor Arbiter
exercises original and exclusive jurisdiction over
termination disputes between an employer and
an employee while the National Labor Relations
Commission exercises exclusive appellate
jurisdiction over the cases provided in Article
244.
Under Section 25 of the Corporation Code, the
President of a corporation is considered a
corporate officer. The dismissal of a corporate
officer is considered an intra-corporate dispute,
not a labor dispute. (Nicanor Malcaba v.
Prohealth Pharma Philippines, Inc., G.R. No.
209085, June 6, 2018)
Q: Jara was hired by Orient Hope as an engine
cadet on board M/V Orchid Sun. On its way to
Oman, M/V Orchid Sun sank off Muscat on
July 12, 2007. Jara sustained leg injuries. On
May 29, 2008, the company-designated
physician suggested that his disability
grading is Grade 11. On March 6, 2008, Jara
filed a complaint with the Labor Arbiter,
insisting that he was entitled to total
permanent disability benefits amounting to
US$60,000.00.
Is Jara entitled to permanent and total
disability compensation considering that
there was a Grade 11 disability grading given
by the company-designated physician?
A: YES. Jara is entitled to permanent and total
disability compensation despite the Grade 11
disability grading given by the company-
designated physician. The Court finds that the
company-designated physician’s failure to issue
a final and definitive medical assessment within
the 240-day extended period transformed the
respondent’s disability to permanent and total.
In Island Overseas Transport Corporation v. Beja,
this Court clarified that: If the maritime
compensation complaint was filed prior to
October 6, 2008, the rule on the 120-day period,
have been made in accordance with Crystal
Shipping, Inc. v. Natividad, that is, the doctrine
then prevailing before the promulgation of
Vergara on October 6, 2008, stands; if, on the
other hand, the complaint was filed from October
6, 2008 onwards, the 240-day rule applies.
(Orient Hope Agencies, Inc. v. Michael Jara, G.R.
No. 204307, June 6, 2018)
Q: L. Natividad Poultry Farms is a business
engaged in livestock and poultry production
which employed several workers as livestock
feed mixers or as maintenance personnel.
The workers filed complaints for illegal
dismissal against L. Natividad, asserting that
they are regular employees, having been
continuously employed by L. Natividad for a
period ranging from more than one (1) year
to 17 years. They stress that L. Natividad
provided all the tools, equipment, and
materials they used as maintenance
personnel and then gave them specific tasks
and supervised their work. The Court of
Appeals ruled that petitioners cannot be
considered as regular employees because
there was no reasonable connection between
the nature of their carpentry and masonry
work and respondents' usual business in
poultry and livestock production, sale, and
distribution. Are the petitioners regular
employees of L. Natividad?
A: YES. The necessity or desirability of the work
performed by an employee can be inferred from
the length of time that an employee has been
performing this work. If an employee has been
employed for at least one (1) year, he or she is
considered a regular employee by operation of
law. x x x Likewise, if an employee has been on
the job for at least one (1) year, even if the
performance of the job is intermittent, the
repeated and continuous need for the employee's
services is sufficient evidence of the
indispensability of his or her services to the
employer's business.
Thus, even if the Court of Appeals is of the
opinion that carpentry and masonry are not
necessary or desirable to the business of
livestock and poultry production, the nature of
their employment could have been characterized
as being under the second paragraph of Art. 280.
Thus, petitioners' service of more than one (1)
year to respondents has made them regular
employees for so long as the activities they were
required to do subsist. (Mario Abuda, et al. v. L.
Natividad Poultry Farms, G.R. No. 200712, July 4,
2018)
Q: To ensure road safety and address the
risk-taking behavior of bus drivers, the
LTFRB issued Memorandum Circular 2012-
001 requiring all Public Utility Bus (PUB)
operators to secure Labor Standards
Compliance Certificates under pain of
revocation of their existing certificates of
public convenience or denial of an
application for a new certificate. The DOLE
likewise issued Department Order No. 118-12
elaborating on the part-fixed-part-
performance-based compensation system
referred to in the said memorandum circular.
Petitioners assail the constitutionality of the
department order and memorandum
circular, arguing that these issuances violate
petitioners' rights to non-impairment of
obligation of contracts, due process of law,
and equal protection of the laws.
Respondents counter that the department
order and memorandum circular are valid
issuances promulgated by the DOLE and the
LTFRB in the exercise of their quasi-
legislative powers. Are the department order
and memorandum circular constitutional?
A: YES. Department Order No. 118-12 and
Memorandum Circular No. 2012-001 are in the
nature of social legislations to enhance the
economic status of bus drivers and conductors,
and to promote the general welfare of the riding
public. D.O. No. 118-12 was issued to grant bus
drivers and conductors minimum wages and
social welfare benefits. Further, petitioners
repeatedly admitted that in paying their bus
drivers and conductors, they employ the
boundary system or commission basis, payment
schemes which cause drivers to drive recklessly.
Not only does D.O. No. 118-12 aim to uplift the
economic status of bus drivers and conductors; it
also promotes road and traffic safety. (Provincial
Bus Operators Association of the Philippines v.
DOLE and LTFRB, G.R. No. 202275, July 17, 2018)
Q: After suffering an Epileptic Seizure with
post-fit neurological deficit, Atraje was
repatriated back to the Philippines and was
referred to the company-designated doctor
for further medical evaluation and treatment.
After completing his treatment, Atraje
continued to suffer from shoulder and neck
pain. Thus, he consulted an independent
specialist who declared him permanently
unfit to resume his duties as a seaman. Atraje
later filed a complaint for permanent and
total disability benefits against his
employers. The latter argued that since
Atraje failed to comply with the third doctor
rule, the assessment of the company-
designated doctor should prevail. Meanwhile,
the Panel of Voluntary Arbitrators noted that
while Atraje initiated submitting to
examination by a third doctor, there was
silence on the part of his employers. Hence, it
held that Atraje could not be faulted anymore
if the appointment of a third physician was
deemed waived in this case. Does non-
compliance with the third doctor rule
prejudice Atraje’s claim for disability
benefits?
A: NO. Under Section 20(A)(3) of the 2010
POEA-SEC, “If a doctor appointed by the seafarer
disagrees with the assessment, a third doctor
may be agreed jointly between the Employer and
the seafarer. The third doctor’s decision shall be
final and binding on both parties.” The
assessment refers to the declaration of fitness to
work or the degree of disability, as can be
gleaned from the first paragraph of Section 20(A)
(3). It presupposes that the company-designated
physician came up with a valid, final, and definite
assessment on the seafarer’s fitness or unfitness
to work before the expiration of the 120- or 240-
day period. In this case, the third doctor-referral
provision does not apply because there is no
definite disability assessment from the company-
designated physicians. (Magsaysay Mol Marine,
Inc. v. Michael Paderes Atraje, G.R. No. 229192,
July 23, 2018)
Q: Moralde, an employee of the Provincial
Health Office, was formally charged with
falsifying his Daily Time Records. Unknown
to the Province’s officials, Moralde filed an
“application for retirement” under the
Revised GSIS Act of 1977 while the
administrative case against him was pending.
The next day, Moralde was found guilty of the
charge and was dismissed from service.
However, on appeal, the Civil Service
Commission (CSC) issued a resolution ruling
that Moralde should be reinstated. It was only
when the Province was processing Moralde’s
papers for his reinstatement that it found out
about his successful application for
retirement. Thus, the Province sought to
modify the CSC’s previous resolution.
Moralde maintained that the CSC's ruling on
his reinstatement was immutable and that, in
any case, he had never retired, but merely
received separation pay. Is Moralde already
separated from government service?
A: YES. Moralde willfully severed his employer-
employee relationship with the government. This
is the inescapable implication of his deliberate
petitioning for benefits occasioned by what he
mistakenly thought was retirement, but which
was more accurately a simulation of resignation.  Petrotech. Can Noell Whessoe, Inc. be held
While retirement benefits differ from separation
benefits, a public officer who applies to receive
either of them nevertheless acts out of the same
contemplation: the complete and unequivocal
termination of his or her employer-employee
relationship with the government. This is
because, by their very nature, retirement and
separation benefits become available only when
employment ceases. (Civil Service Commission v.
Gabriel Moralde, G.R. No. 211077, August 15,
2018)
Q: Petrotech, a subcontractor of Liquigaz,
engaged the services of Independent Testing
Consultants to conduct non-destructive
testing on Liquigaz's piping systems.
Independent Testing Consultants conducted
the agreed tests. It later billed Petrotech.
However, despite demand, Petrotech refused
to pay. Independent Testing Consultants filed
a Complaint for collection of sum of money
with damages against Petrotech, Liquigaz,
and Noell Whessoe plus legal interest. It
joined Noell Whessoe as a defendant, alleging
that it was Liquigaz's contractor that
subcontracted Petrotech. In its Answer,
Liquigaz argued that Independent Testing
Consultants had no cause of action against it
since there were no contractual relations
between them and that any contract that
Independent Testing Consultants had was
with its subcontractors. Noell Whessoe, on
the other hand, denied that it was Liquigaz's
contractor and that its basic role was merely
to supervise the construction of its gas plants.
It argued that any privity of contract was only
with Petrotech. Thus, it asserted that
Petrotech alone should be liable to
Independent Testing Consultants. Noell
Whessoe later submitted a Formal Offer of
Documentary Exhibits showing that Liquigaz
engaged Whessoe Projects Limited (Whessoe
UK), a limited company organized under the
laws of the United Kingdom, for the
construction of its storage facilities. Whessoe
UK, in turn, engaged Noell Whessoe, a
separate and distinct entity, to be the
construction manager for the Mariveles
Terminal Expansion Project. The documents
further stated that Whessoe UK had already
paid in full its contractual obligations to
solidarily liable with respondents Liquigaz
Philippines Corporation and Petrotech
Systems, Inc. for unpaid fees to respondent
Independent Testing Consultants, Inc.?
A: NO. There was insufficient evidence proving
that Whessoe UK and petitioner were two (2)
separate and distinct entities. Petitioner failed to
prove that for the Mariveles Terminal Expansion
Project, it was a separate and distinct entity from
Whessoe UK. Therefore, it cannot set up the
defense of privity of contract (Article 1729) to
escape liability. Under Article 1729, respondent
Independent Testing Consultants had a cause of
action against Liquigaz and petitioner, even if its
contract was only with Petrotech. However,
Article 1729, while serving as an exception to the
general rule on the privity of contracts, likewise
provides for an exception to this exception. The
contractor is solidarily liable with the owner and
subcontractor for any liabilities against a
supplier despite the absence of contract between
the contractor and the supplier, except when the
subcontractor has already been fully paid for its
services. Here, there was uncontroverted
evidence that Petrotech had already been paid
for its services. Since Whessoe UK and petitioner
should be considered the same entity for the
purposes of the Mariveles Terminal Expansion
Project, Whessoe UK's full payment to Petrotech
would serve as a valid defense against
petitioner's solidary liability. Thus, petitioner
still cannot be held solidarily liable with Liquigaz
and Petrotech for any remaining receivables
from respondent Independent Testing
Consultants. Any remaining obligations to it
should be solidarily borne by the owner,
Liquigaz, and the subcontractor, Petrotech.
(Noelle Whessoe, Inc. v. Independent Testing
Consultants, Inc., G.R. No. 199851, November 7,
2018)
Q: Tahanang Walang Hagdanan is a private
organization engaged in the business of
producing and marketing various
handicrafts, utilizing employees who are
mostly physically disabled. Sister Valeriana
Baerts is a nun who recruited Bernardo B.
Pacios, et al. to work for Tahanang Walang
Hagdanan. They were among the regular
employees who were persons with disability
of Tahanang Walang Hagdanan for years,
until they were dismissed. The workers filed
a complaint for illegal dismissal, among other
things against Tahanang Waglang Hagdanan.
The Labor Arbiter rendered a decision in
favor of the workers. Tahanang Walang
Hagdanan appealed the Labor Arbiter’s
decision before the NLRC. The appeal and the
subsequent motion for reconsideration were
denied. Thus, Tahanang Walang Hagdanan,
filed a Petition for Certiorari before the CA.
The CA reversed the NLRC Resolution. It
reinstated the appeal of Tahanang Walang
Hagdanan. In the meantime, before the CA
reinstated the appeal before the NLRC, the
Labor Arbiter issued a Writ of Execution. In
lieu of the writ of execution, the workers filed
a Motion to Release the Supersedeas Bond.
Tahanang Walang Hagdanan opposed the
workers’ motion to release the bond because
of the CA Decision reinstating their appeal
before the NLRC. The Labor Arbiter then
issued a resolution suspending the Writ of
Execution because of the CA Decision
reinstating the respondents’ appeal before
the NLRC. The workers filed a Petition for
Mandamus to proceed with the execution and
order the issuance of the bond before the CA.
The Petition was denied and held that the
NLRC Resolution denying Tahanang Walang
Hagdanan’s appeal was reversed by the CA.
Thus, the suspension of the execution
proceedings was correct. Petitioners assert
that they have been living lives of abject
poverty, misery, and great suffering since
they were illegally dismissed. Petitioners
claim that it was the purely ministerial act or
duty of the NLRC to order the release of the
supersedeas bond. Furthermore, Petitioners
point out that the CA did not include any
restraining order in its Decision. Hence, the
Writ of Execution should have continued.
Should the suspension of the execution
proceedings be affirmed? 
A: NO. Execution may be authorized even
pending appeal. In Aris (Phil.), Inc. v. National
Labor Relations Commission the Court held that
the Labor Code already allowed execution of
decisions of the NLRC pending their appeal to the
Secretary of Labor and Employment. In
authorizing execution, the law itself has laid
down a compassionate policy which, once more,
vivifies and enhances the provisions of the 1987
Constitution on labor and the workingman. This
Court finds that the principles allowing execution
pending appeal invoked in Aris are equally
applicable here as petitioners are poor
employees, deprived of their only source of
livelihood for years and reduced to begging on
the streets. (Bernardo Pacios v. Tahanang
Walang Hagdanan, G.R. No. 229579, November
14, 2018)
Q: Royal Savings Bank was organized and
incorporated as a thrift bank. Not long
thereafter, Royal Savings Bank and
Commercial Bank of Manila entered into a
Memorandum of Agreement to rehabilitate
and infuse capital into Royal Savings Bank.
Royal Savings Bank was renamed Comsavings
Bank. In 1987, the GSIS transferred its
holdings from Commercial Bank of Manila to
Boston Bank. Comsavings Bank was not
included in the transfer. Due to Boston Bank’s
acquisition of Commercial Bank of Manila, the
GSIS took over the control and management
of Comsavings Bank. Sometime in 2001,
Comsavings Bank changed its name to GSIS
Family Bank. On June 6, 2011, President
Aquino signed into law Republic Act No.
10149, or the GOCC Governance Act of 2011.  Paringit underwent a pre-employment
The law created the Governance Commission
for Government-Owned or Controlled
Corporations (Governance Commission),
defined as “a central advisory, monitoring,
and oversight body with authority to
formulate, implement, and coordinate
policies” in its governed sector. On December
20, 2013, counsel for the GSIS Union sent GSIS
Family Bank a demand letter for the payment
of Christmas bonus to its members, as
stipulated in their Collective Bargaining
Agreement (CBA). The GSIS Family Bank's
refused to negotiate a new collective
bargaining agreement. Thus, the GSIS Union
filed a Complaint before the National
Conciliation and Mediation Board. They
aimed to compel GSIS Family Bank to abide
by the provisions of their existing Collective
Bargaining Agreement. Can the GSIS Family
Bank, a non-chartered government-owned or
controlled corporation, enter into a collective
bargaining agreement with its employees?
A: NO. RA 10149 directed the Governance
Commission to develop a Compensation and
Position Classification System, to be submitted
for the President's approval, which shall apply to
all officers and employees of government-owned
or controlled corporations, whether chartered or
non-chartered. On March 22, 2016, President
Aquino issued Executive Order No. 203, which
approved the compensation and classification
standards and the Index of Occupational Services
Framework developed and submitted by the
Governance Commission. When it comes to
collective bargaining agreements and collective
negotiation agreements in government-owned or
controlled corporations, Executive Order No. 203
unequivocally stated that while it recognized the
right of workers to organize, bargain, and
negotiate with their employers, "the Governing
Boards of all covered [government-owned or
controlled corporations], whether Chartered or
Non-chartered, may not negotiate with their
officers and employees the economic terms of
their [collective bargaining agreements]." (GSIS
Family Bank Employees Union v. Secretary
Villanueva, G.R. No. 210773, January 23, 2019)
Q: Paringit entered into a 6-month
employment contract with MidSouth Ship and
Crew Management. Prior to his deployment,
medical examination, where he disclosed that
he had high blood pressure. Still, he was
declared fit for duty. A few months later,
Paringit began to felt constant fatigue and
stress. When the vessel was docked at the
port of Las Palmas, Spain, Paringit was
rushed to the intensive care unit where he
underwent blood transfusion. He was later on
discharged from the ICU with a diagnosis of:
"decompensated cardiac insufficiency. Severe
anemia. Renal dysfunction." He was soon
medically repatriated and arrived in Manila.
Paringit was admitted to the YGEIA Medical
Center for evaluation and management. He
was discharged from the hospital with a work
diagnosis of: 'Congestive Heart Failure;
Hypertensive Cardiovascular Disease;
Valvular Heart Disease; Anemia Secondary to
Upper GI Bleeding to Bleeding Peptic Ulcer
Disease." Paringit consulted Dr. Donato-Tan a
cardiologist at the Philippine Heart Center.
After evaluating Paringit and reviewing the
results of his laboratory examinations, Dr.
Donato-Tan concluded that with his heart
condition, he would need regular medication,
further laboratory procedures, and periodic
check-ups with a cardiologist to prevent any
aggravation of his illness. The doctor
declared him to be permanently disabled and
unfit for duty as a seaman. Dr. Quetulio noted
that Paringit was a candidate for open heart
surgery. She also advised him to continue his
medication while waiting for his employer's
go signal on his recommended procedures.
After a month, Paringit was still waiting for
his employer’s decision on his open- heart
surgery.  Paringit filed a Complaint for
medical expenses and other money claims
against his employers. Dr. Quetulio informed
Global Gateway that Paringit seemed hesitant
to undergo the recommended operation and
instead opted for herbal treatment. She also
stated that Paringit's heart condition was
pre-existing, not work-related. Shall
compensability shall be determined solely by
the nature of work?
A: NO. In Magsaysay Maritime Services, et al. v.
Laurel, the SC emphasized that in determining
the compensability of an illness, it is not
necessary that the nature of the employment be
the sole reason for the seafarer's illness. A
reasonable connection between the disease and
work undertaken already suffices. The poor food
choices in Paringit’s workplace led to
contributed to his heart disease. He was declared
fit to work prior to embarkation, hence, there is
no other conclusion that that he developed or his
illness were triggered or aggravated on board
and his working conditions precipitated his
unknown illness. (Oscar Paringit v. Global
Gateway Crewing Services, Inc., G.R. No. 217123,
February 6, 2019)
Q: Can the filing of the complaint prior to the
issuance of disability assessment be
considered premature if the company refused
to respond to seafarer's request for open-
heart surgery as recommended by the
physician?
A: NO. The records show that Dr. Quetulio
recommended petitioner to undergo open-heart
surgery, but respondent Global Gateway failed or
refused to act on this. Dr. Quetulio first broached
the possibility of open-heart surgery on March 5,
2012, about a month after petitioner's medical
repatriation. The succeeding weeks led to her
formally advising respondent Global Gateway of
petitioner's need for open-heart surgery, yet the
company failed or refused to respond to her
request, despite repeated follow-ups. Dr.
Quetulio's failure to timely issue a disability
assessment was due to respondent Global
Gateway, not because petitioner impliedly
refused treatment due to his supposed
inclination toward an alternative treatment.
(Oscar Paringit v. Global Gateway Crewing
Services, Inc., G.R. No. 217123, February 6, 2019)
Q: Aciel Corporation and ANA Construction
entered into a Contract Agreement for the
construction of a reinforced concrete
manufacturing plant in Makati City which
covered all materials, labor, equipment, and
tools, including any other works required,
and a change order clause. The works
performed by ANA Construction were
inspected by Aciel Corp and punch lists were
prepared to monitor ANA Construction's
rectifications. Then, ANA Construction sent
letters to Aciel Corp. requesting for payment
of unpaid work accomplishments amounting
to P7,292,721.27 which Aciel Corp. refused to
pay, alleging that it did not follow the
procedure prescribed by the contract for
change orders. Is Aciel Corp. liable to ANA
Construction for unpaid work
accomplishment?
A: YES. This amount shall be fixed by a court.
Where one has rendered services to another, and
these services are accepted by the latter, in the
absence of proof that the service was rendered
gratuitously, it is but just that he should pay a
reasonable remuneration therefore because it is
a well-known principle of law that no one should
be permitted to enrich himself to the damage of
another. Jurisprudence has settled that even in
cases where parties enter into contracts which
do not strictly conform to standard formalities or
to the typifying provisions of nominate contracts,
when one renders services to another, the latter
must compensate the former for the reasonable
value of the services rendered. (Metro Bottled
Water Corporation v. Andrada Construction &
Development Corp., G.R. No. 202430, March 6,
2019)
Q. Matiere SAS hired Acosta, an Engineer, as
Technical Assistant. Under the Employment
Agreement Acosta was tasked to: (1) Prepare
reports regarding Woodfields Consultants,
Inc. (WCI) consultants; (2) Be the
intermediary between the CAD operators in
WCI and the management in the office; (3)
Attend coordination meetings with
consultant; (4) Evaluate billings; (5) Follow
the SIT and prepare reports; (6) Prepare
various reports as required by the resident
manager; and (7) Site visits.
On June 27, 2013, Matiere SAS sent a letter to
Acosta informing him that his employment
contract will end on July 31, 2013 due to the
cessation of the company’s delivery
operations and the diminution of activities
and that it cannot find any reinstatement at
the office. He also received a calculation of his
separation pay.  redundant positions.
On June 26, 2013, Matiere SAS informed DOLE
that it would have to terminate five (5) of its
workers which includes Acosta; four (4) of
which were "assigned to the stripping
operations", while Acosta, who was based in
the office, was "primarily in charge of the
monitoring of shipments". Matiere SAS also
filed an Establishment Employment Report,
citing redundancy and the completion of
delivery of supplies as its reasons for
dismissing its employees.  mainly to the delivery of supplies, it should have
Acosta filed a complaint to NLRC for illegal
dismissal alleging that the declaration of
redundancy of his position was not based on
fair and reasonable criteria pointing out that
he, the most senior engineer, was dismissed
while the other engineers remained.  fair and reasonable criteria in determining what
Is Acosta validly dismissed on the ground of
redundancy?
A. NO. Redundancy is recognized as one (1) of
the authorized causes for dismissing an
employee under the Labor Code as provided
under Article 298.
For the implementation of a redundancy
program to be valid, the employer must comply
with the following requisites: (1) written notice
served on both the employees and the
Department of Labor and Employment at least
one month prior to the intended date of
retrenchment; (2) payment of separation pay
equivalent to at least one month pay or at least
one month pay for every year of service,
whichever is higher; (3) good faith in abolishing
the redundant positions; and (4) fair and
reasonable criteria in ascertaining what
positions are to be declared redundant and
accordingly abolished.
Respondents complied with the first and second
requisites; notifying both Acosta and DOLE at
least a month prior planned redundancy and
providing Acosta computation of his separation
pay. However, the third and fourth requisites are
wanting. To establish good faith, the company
must provide substantial proof that the services
of the employees are in excess of what is
required of the company, and that fair and
reasonable criteria were used to determine the
Here, Matiere SAS' only basis for declaring
Acosta's position redundant was that his
function, which was to monitor the delivery of
supplies, became unnecessary upon completion
of the shipments. However, upon careful
scrutiny, the Employment Agreement itself
contradicts Matiere SAS' allegation. Under
Acosta's job description listed in his tasks as a
technical assistant there was no mention of
monitoring shipments. If his work pertains
been specifically stated in his job description.
There was no basis for respondents to consider
his position irrelevant when the shipments had
been completed.
Matiere SAS also failed to show that they used
positions should be declared redundant.
Although Acosta was among the five (5)
employees dismissed, he cannot be similarly
situated with the other employees since his duty
is not limited to the monitoring of deliveries.
Accordingly, this Court declares petitioner to
have been illegally dismissed. (Manuel Acosta v.
Matiere SAS and Philippe Gouvary, G.R. No.
232870,  June 3, 2019)
Q. Aldovino and her co-applicants applied for
work at Gold and Green Manpower a local
manning agency. Eventually, they were hired
as sewers for Dipper Semi-Conductor, a
Taiwan-based company. Their respective
employment contracts provided an eight (8)-
hour working day, a fixed monthly salary, and
entitlement to overtime pay, among others.
Once Aldovino and her co-workers arrived in
Taiwan, Gold and Green Manpower took all
their travel documents, including their
passports. They were then made to sign
another contract that provides that they
would be paid on a piece-rate basis instead of
a fixed monthly salary. Because they were
paid on a piece-rate basis, they received less
than the fixed monthly salary stipulated in
their original contract. When Aldovino and
her co-workers inquired, Dipper Semi-
Conductor refused to disclose the schedule of
payment on a piece-rate basis. Aldovino and
her co-workers filed before a local court in
Taiwan a Complaint against their employers,
Dipper Semi-Conductor and Sage
International. The parties met before the
Bureau of Labor Affairs for a dialogue. There,
Dipper Semi-Conductor ordered Aldovino
and her co-workers to return to the
Philippines as it was no longer interested in
their services. All of them returned to the
Philippines. They eventually filed before the
Labor Arbiter a case for illegal termination,
underpayment of salaries, human trafficking,
illegal signing of papers, and other money
claims. Respondents argued that petitioners
were not illegally dismissed and that they
voluntarily returned to the Philippines. Were
petitioners illegally dismissed?
A: YES. Under the Labor Code, employers may
only terminate employment for a just or
authorized cause and after complying with
procedural due process requirements. Articles
297 and 300 of the Labor Code enumerate the
causes of employment termination either by
employers or employees. In illegal dismissal
cases, the burden of proof that employees were
validly dismissed rests on the employers. Failure
to discharge this burden means that the
dismissal is illegal.
A review of the records here shows that the
termination of petitioners' employment was
effected merely because respondents no longer
wanted their services. This is not an authorized
or just cause for dismissal under the Labor Code.
Employment contracts cannot be terminated on
a whim. Furthermore, petitioners were not
accorded due process. A valid dismissal must
comply with substantive and procedural due
process: there must be a valid cause and a valid
procedure. The employer must comply with the
two (2)-notice requirement, while the employee
must be given an opportunity to be heard. Here,
petitioners were only verbally dismissed,
without any notice given or having been
informed of any just cause for their dismissal.
With their right to substantive and procedural
due process denied, it is clear that petitioners
were illegally dismissed from service. (Julita M.
Aldovino et al., v. Gold and Green Manpower et al.
G.R. No. 200811, June 19, 2019)
Q. Toquero was employed by Crossworld as a
fitter for vessel MV AS VICTORIA for a
duration of contract for seven (7) months.
Toquero underwent a pre-employment
medical examination and was declared fit for
sea duty. While on board the vessel, Toquero
was assaulted by his fellow seafarer, Jamesy
Fong.
According to Toquero, he and Fong was
instructed by the master of vessel to check
and repair a generator. While repairing,
Toquero advised Fong not to remove the
flanges because the problem was in the
generator which his irked Fong, and recalled
their prior altercation and challenged him to
a fistfight. He ignored Fong and continued
working when suddenly Fong hit the back of
his head with a big and heavy metal spanner,
knocking him unconscious. He was given first
aid treatment at the ship clinic, where his
vital signs were monitored.
Toquero's assessment shows that his physical
discomfort was due to trauma and skull
defect. His Medical Evaluation Report read
that Toquero became incapacitated because
of the serious head injury that he incurred on
board… He has a large bone defect which may
pose further damage to his brain. Contusion
of the brain tissue also occurred at the site of
the skull fracture… At this time, he is no
longer allowed to engage in heavy physical
activities. The ship's environment is also
dangerous to him because of the unsteady
state of the vessel when sailing at high seas.
Dizziness may set anytime and may result to
fall, which may cause further irreparable
injury. Because of the impediment, he is
permanently unfit to return to work as a
seaman in any capacity and considered for
total permanent disability.
Is Toquero's injury compensable?
A. YES. A disability is compensable under the
POEA Standard Employment Contract if two (2)
elements are present: (1) the injury or illness
must be work-related; and (2) the injury or
illness must have existed during the term of the
seafarer's employment contract. Hence, a
claimant must establish the causal connection
between the work and the illness or injury
sustained.
Here, the two (2) elements of a work-related
injury are present. Not only was petitioner's
injury work-related, it was sustained during the
term of his employment contract. His injury,
therefore, is compensable.
Respondents' argument that the claim is
precluded because the injury is due to the willful
acts of another seafarer is untenable. The POEA
Standard Employment Contract disqualifies
claims caused by the willful or criminal act or
intentional breach of duties done by the
claimant, not by the assailant. It is highly unjust
to preclude a seafarer's disability claim because
of the assailant's willful or criminal act or
intentional breach of duty. (George M. Toquero v.
Crossworld Marine Services, et al., G.R. No.
213482, June 26, 2019)
Q. Smith Bell Manning hired Esteva as a
seafarer for nine (9) months. He underwent
the prescribed medical examination and was
pronounced fit to work. While he was
onboard the vessel, Esteva began to suffer
severe back pains. He underwent x-ray and
was diagnosed with lumbar disc prolapse.
According to the Injury/Illness Report, his
condition required a specialist treatment and
possible operation. Dr. Watson declared
Esteva to have a temporary total disability
and unfit for work and recommended
immediate repatriation. Wilhelmsen Ship
Management also wrote a letter requesting
that Esteva be examined by the company-
designated physician in the Philippines.
Esteva returned to the Philippines and
reported to his employer. The company-
designated physician, Dr. Cruz-Balbon, issued
a Medical Certificate indicating that Esteva
was given medications for Pott's disease, a
form of tuberculosis of the spine. She
prescribed that Esteva take at least one (1)
year of treatment. In the Medical Certificate,
Esteva's suggested disability grading was
Grade 8, with 2/3 loss of lifting power. Esteva
consulted another doctor, Dr. Reyes-Paguia,
who issued another Medical Certificate.
Esteva consulted another doctor, Dr.
Raymundo, an orthopedic surgeon. The
physician issued a Medical Report which
showed Esteva to be ambulatory but walking
with a limp and his condition will no longer
allow him to return as an able bodied
seaman. Is Esteva entitled to total disability
benefits?
A. YES. The entitlement of an overseas seafarer
to disability benefits is governed by law, the
employment contract, and the medical findings.
Section 20, (3) of the POEA Standard
Employment Contract states that “. . . If a doctor
appointed by the seafarer disagrees with the
assessment, a third doctor may be agreed jointly
between the Employer and the seafarer. The third
doctor's decision shall be final and binding on
both parties.”
The assessment referred to in this provision is
the declaration of fitness to work or the degree
of disability. It presupposes that the company-
designated physician came up with a valid, final,
and definite assessment on the seafarer's fitness
to work before the 120-day or 240-day period
expires. The SC has held that despite the wording
of the provision in Section 20 of the POEA
Standard Employment Contract, the referral of a
disputed medical assessment to a third doctor is
mandatory. 
However, as the one contesting the company-
designated physician's findings, it is the
seafarer's duty to signify the intention to resolve
the conflict through the referral to a third doctor.
If the seafarer' does not contest the findings and
fails to refer the assessment to a third doctor,
"the company can insist on its disability rating
even against a contrary opinion by another
physician." Securing a third doctor's opinion is
the duty of the employee, who must actively or
expressly request for it. (Jessie C. Esteva v.
Wilhelmsen Smith Bell Manning, et al., G.R. No.
225899, July 10, 2019)
Q: GSIS foreclosed a mortgage involving two
parcels of land. The Municipal Agrarian
Reform Officer issued a Notice of Coverage
covering one of the two parcels of land. According to Roxas, Proclamation No. 1520
Subsequently, the Department of Agrarian neither reclassified nor converted all lands in the
Reform offered to pay GSIS for the covered Maragondon, Ternate, and Nasugbu from
land. GSIS contends that the land may be agricultural to non-agricultural. Thus, these
excluded from coverage and that an areas were deemed not to have been
exception exists outside Section 10 of the automatically excluded from the coverage of the
Comprehensive Agrarian Reform Law. Can Comprehensive Agrarian Reform Program. (Fil-
the property be excluded from compulsory Estate Properties, Inc. v. Paulino Reyes, G.R. No.
agrarian reform coverage? 152797, September 18, 2019)
A: NO. Roman Catholic Archbishop of Caceres v.
Secretary of Agrarian Reform has settled that the
exemptions from agrarian reform coverage are
contained in “in an exclusive list,” which are
enumerated under Section 10 of Republic Act No.
6557. Section 7 of the Comprehensive Agrarian
Reform Law is even more specific. It explicitly
states that “lands foreclosed by government
financial institutions” are subject to agrarian
reform. (Government Service Insurance System v.
Municipal Agrarian Reform Officer Romerico
Datoy, G.R. No. 232863, July 24, 2019)
Q: Manila Southcoast entered into a joint
venture agreement with Fil-Estate Properties,
Inc. for the development of 10 lots with an
area totaling 1,219.0133 hectare. In view of
this joint venture agreement, Fil-Estate filed a
Petition on October 8, 1996, praying that
these 10 lots be excluded from the coverage
of the Comprehensive Agrarian Reform
Program. It claimed that the lots had slopes of
more than 18%. Fil-Estate further argued that
the 10 lots, located inside a tourist zone, were
excluded from the Comprehensive Agrarian
Reform Law’s coverage. Are the subject lots
excluded from the coverage of the
Comprehensive Agrarian Reform Program?
A: NO. Proclamation No. 1520, on which Fil-
Estate heavily relies, was issued on November
28, 1975. The Proclamation identifies the
municipalities of Maragondon and Ternate in
Cavite and the municipality of Nasugbu in
Batangas as potential tourist zones.
The effect of Proclamation No. 1520 vis-à -vis the
application of the Comprehensive Agrarian
Reform Law was tackled in Roxas & Company,
Inc. v. DAMBA-NSFW. This Court rejected the
argument and ruled that Proclamation No. 1520
merely identified areas that had potential
tourism value.