PASEI v DRILON GR No.

81959 June 30, 1988

Topic: Valid Exercise of Police Power in Labor Cases

FACTS:
The petitioner, Philippine Association of Service Exporters, Inc. (PASEI, for short), a firm
"engaged principally in the recruitment of Filipino workers, male and female, for overseas placement,"
challenges the Constitutional validity of Department Order No. 1, Series of 1988, of the Department of
Labor and Employment, in the character of "GUIDELINES GOVERNING THE TEMPORARY
SUSPENSION OF DEPLOYMENT OF FILIPINO DOMESTIC AND HOUSEHOLD WORKERS,"
through petition for certiorari and prohibition.
Specifically, the measure is assailed for "discrimination against males or females;" that it "does
not apply to all Filipino workers but only to domestic helpers and females with similar skills;" and that it
is violative of the right to travel. It is held likewise to be an invalid exercise of the lawmaking power,
police power being legislative, and not executive, in character.
On May 25, 1988, the Solicitor General, on behalf of the respondents Secretary of Labor and
Administrator of the Philippine Overseas Employment Administration, filed a Comment informing the
Court that on March 8, 1988, the respondent Labor Secretary lifted the deployment ban in the states of
Iraq, Jordan, Qatar, Canada, Hongkong, United States, Italy, Norway, Austria, and Switzerland. In
submitting the validity of the challenged "guidelines," the Solicitor General invokes the police power.
ISSUE:
WON D.O. No. 1 is unconstitutional it being an invalid exercise of the lawmaking power since
police power is legislative and not executive in nature.
RULING:
NO. The concept of police power is well-established in this jurisdiction. It has been defined as the
"state authority to enact legislation that may interfere with personal liberty or property in order to promote
the general welfare." As defined, it consists of (1) an imposition of restraint upon liberty or property, (2)
in order to foster the common good. It is not capable of an exact definition but has been, purposely, veiled
in general terms to underscore its all-comprehensive embrace.
As a general rule, official acts enjoy a presumed validity. In the absence of clear and convincing
evidence to the contrary, the presumption logically stands. The petitioner has shown no satisfactory
reason why the contested measure should be nullified. Department Order No. 1 applies only to "female
contract workers," but it does not thereby make an undue discrimination between the sexes. It is well-
settled that "equality before the law" under the Constitution does not import a perfect identity of rights
among all men and women. It admits of classifications, provided that (1) such classifications rest on
substantial distinctions; (2) they are germane to the purposes of the law; (3) they are not confined to
existing conditions; and (4) they apply equally to all members of the same class.

Association of Medical Clinic for Overseas Workers Inc. v. GCC Approved Medical Center
Association, GR 207132, 6 December 2016

Topic: Valid Exercise of Police Power in Labor Cases

FACTS:
 DOH issued Administrative Order No. 5, Series of 2001 which directed the decking or equal
distribution of migrant workers among the several clinics who are members of GAMCA.
Subsequently, RA No. 10022 lapsed into law without the President's signature.
 Section 16 of RA No. 10022, the DOH, directed GAMCA to cease and desist from implementing the
referral decking system and to wrap up their operations within three (3) days from receipt thereof.
 GAMCA filed a petition before the RTC for grave abuse of discretion on the part of DOH and
praying to declare Section 16 of RA No. 10022 as unconstitutional. It noted that the referral decking
system is part of the application procedure in obtaining visas to enter the GCC States, a procedure
made in the exercise of the sovereign power of the GCC States to protect their nationals from health
hazards, and of their diplomatic power to regulate and screen entrants to their territories.

ISSUE/S:
Whether the DOH letters prohibiting GAMCA from implementing the referral decking system embodied
under Section 16 of Republic Act No. 10022 violates Section 3, Article II of the 1987 Constitution for
being an undue taking of property.

RULING:
No, Police power includes (1) the imposition of restraint on liberty or property, (2) in order to foster the
common good. The exercise of police power involves the "state authority to enact legislation that may
interfere with personal liberty or property in order to promote the general welfare."
By its very nature, the exercise of the State's police power limits individual rights and liberties, and
subjects them to the "far more overriding demands and requirements of the greater number."[92] Though
vast and plenary, this State power also carries limitations, specifically, it may not be exercised arbitrarily
or unreasonably. Otherwise, it defeats the purpose for which it is exercised, that is, the advancement of
the public good.
The government's exercise of police power must satisfy the "valid object and valid means" method of
analysis: first, the interest of the public generally, as distinguished from those of a particular class,
requires interference; and second, the means employed are reasonably necessary to attain the objective
sought and not unduly oppressive upon individuals.
These two elements of reasonableness are undeniably present in Section 16 of RA No. 10022. The
prohibition against the referral decking system is consistent with the State's exercise of the police power
to prescribe regulations to promote the health, safety, and general welfare of the people. Public interest
demands State interference on health matters, since the welfare of migrant workers is a legitimate public
concern.
These rules are part of the larger legal framework to ensure the Overseas Filipino Workers' (OFW) access
to quality healthcare services, and to curb existing practices that limit their choices to specific clinics and
facilities.
GOPIO VS. BAUTISTA, GR No. 205953, 06 June 2018

Topic: State’s full protection to labor

FACTS:
On September 26, 2008, respondent Bautista was hired as a Project Manager for Shorncliffe
Limited in Papua New Guinea through Job Asia Management Services, a single proprietorship owned by
petitioner Dionella A. Gosio, which is engaged in the business of recruitment, processing, and
deployment of land-based manpower for overseas work.
Bautista's contract stated that his employment shall be valid and effective for 31 months. On July
6, 2009, or just nine months after his deployment in Papua New Guinea, Bautista was served a notice of
termination effective July 10, 2009 on the alleged grounds of unsatisfactory performance and failure to
meet the standards of the company. The basis of termination is Article 4.3 of the employment contract
which states that “The Employer or Employee may terminate this contract on other grounds.
 The Employer should give one month's written notice of his intention to terminate or in lieu
thereof pay the Employee a sum equivalent to one month's salary.” He was paid his salary for the period
July 1 to 10, 2009, annual leave credits, and one-month pay net of taxes. Bautista then lodged a complaint
with the arbitration branch of the NLRC against Job Asia, Gopio, and Shorncliffe for illegal dismissal and
monetary claims.
He claimed that he was terminated without just cause since there had been no job evaluation
conducted prior to Shorncliffe's decision to dismiss him from employment. As a result, he is entitled to
the payment of his salaries for the unexpired portion of his contract, or for 22 months. He alleged that
while his contract contained an understated monthly income of P40,000.00, he was actually being paid
the amount of P115,850.00 a month. Petitioner, argued that Bautista's employment was terminated
because he failed to meet Shorncliffe's standards.

 LA rendered Bautista to have been illegally dismissed as the dismissal was not proven to be for a just
cause and Shorncliffe failed to observe due process.
 NLRC set aside the decision of the LA and dismiss the complaint for lack of merit.
 However, CA annulled the decision of NLRC and reinstated that of the Labor Arbiter.
ISSUE:
Whether or not Bautista was illegally dismissed from employment.
RULING:
Yes, the Court uphold with modification the decision of the CA.
In termination disputes or illegal dismissal cases, it has been established by law and jurisprudence
that the employer has the burden of proving that the dismissal is for just and valid causes; and failure to
do so would necessarily mean that the dismissal was not justified and is, therefore, illegal. Taking into
account the character of the charges and the penalty meted to an employee, the employer is bound to
adduce clear, accurate, consistent, and convincing evidence to prove that the dismissal is valid and legal.
This is consistent with the principle of security of tenure as guaranteed by the Constitution and
reinforced by Article 292(b) of the Labor Code. The SC found that Bautista's incompetence as the alleged
just cause for his dismissal was not proven by substantial evidence. Also, Bautista was not accorded due
process. Here, Bautista was dismissed under Article 4.3 of the employment contract which allegedly
permits his employer, to terminate the contract on unspecified "other grounds" by giving one month's
written notice of its intention to terminate, or in lieu thereof, to pay the employee a sum equivalent to one
month's salary.
Bautista was notified on July 6, 2009 that his services will be terminated effective on the close of
business hours on July 10, 2009, allegedly because his performance was "unsatisfactory and did not meet
the standards of the Company." He was also paid one-month salary in lieu of one month's notice of the
termination of his employment. This is not in accordance with the two-notice requirement mandated by
the Labor Code in effecting a valid dismissal. The requirement of notice is intended to inform the
employee concerned of the employer's intent to dismiss him and the reason for the proposed dismissal.
On the other hand, the requirement of hearing affords the employee an opportunity to answer his
employer's charges against him and accordingly defend himself therefrom before dismissal is effected. In
this case, Bautista was not given a chance to defend himself. Five days after the notice was served, he was
repatriated. Clearly, he was denied his right to due process. The SC struck down the validity of Article 4.3
of the employment contract as it contravenes the constitutionally-protected right of every worker to
security of tenure.
It deprives the employee of his right to due process of law as it gives the employer the option to
do away with the notice requirement provided that it grants one-month salary to the employee in lieu
thereof. It denies the employee of the right to be apprised of the grounds for the termination of his
employment without giving him an opportunity to defend himself and refute the charges against him.

INDUSTRIAL PERSONNEL & MANAGEMENT SERVICES, INC. (IPAMS) et al vs.

JOSE G. DE VERA, GR No. 205703, Mar 07, 2016

Topic: Lex Loci Contracts (OFW Protection)

FACTS
Petitioner Industrial Personnel & Management Services, Inc. (IPAMS) is a local placement
agency duly organized and existing under Philippine laws. Petitioner SNC Lavalin Engineers &
Contractors, Inc. (SNC-Lavalin) is the principal of IPAMS, a Canadian company with business interests
in several countries.
Respondent Alberto Arriola, a licensed general surgeon in the Philippines, was hired by SNC-
Lavalin, through its local manning agency, IPAMS, as a safety officer in its Ambatovy Project site in
Madagascar. After three months, Arriola received a notice of pre-termination of employment due to
diminishing workload in the area of his expertise and the unavailability of alternative assignments.
Consequently, Arriola was repatriated and he filed a complaint against the petitioners for illegal dismissal
and non-payment of overtime pay, vacation leave and sick leave pay before the Labor Arbiter (LA).
He claimed that SNC-Lavalin still owed him unpaid salaries equivalent to the three-month
unexpired portion of his contract and asserted that the latter never offered any valid reason for his early
termination and that he was not given enough notice regarding the same. He also insisted that the
petitioners must prove the applicability of Canadian law before the same could be applied to his
employment contract.
The petitioner denied the charge of illegal dismissal against them. They relied on a copy of the
Employment Standards Act (ESA) of Ontario, which was duly authenticated by the Canadian authorities
and certified by the Philippine Embassy. They insisted that all of Arriola's employment documents were
processed in Canada, not to mention that SNC Lavalin's office was in Ontario, the principle of lex loci
celebrationis was applicable. Hence, they insisted that Canadian laws governed the contract.
 The said foreign law did not require any ground for early termination of employment, and the
only requirement was the written notice of termination. Even if Philippine laws should apply, Arriola
would still be validly dismissed because domestic law recognized retrenchment and redundancy as legal
grounds for termination.
The Labor Arbiter (LA) dismissed the complaint of Arriola, while the NLRC reversed the LA's
ruling stating the Filipino workers are protected by our labor laws wherever they may be working. The
petitioners filed a petition for certiorari before the CA arguing that it should be the ESA, or the Ontario
labor law, that should be applied in Arriola's employment contract, but the Court of Appeals affirmed
NLRC. Hence, this petition.

ISSUES
Whether or not Canadian law shall be applied to this case.

RULING
No, the foreign law invoked is contrary to the Constitution and the Labor Code. As a rule,
Philippine laws apply even to overseas employment contracts. This rule is rooted in the constitutional
provision of Section 3, Article XIII that the State shall afford full protection to labor, whether local or
overseas.
Hence, even if the OFW has his employment abroad, it does not strip him of his rights to security
of tenure, humane conditions of work and a living wage under our Constitution. As an exception, the
parties may agree that a foreign law shall govern the employment contract. A synthesis of the existing
laws and jurisprudence reveals that this exception is subject to the following requisites:
1. That it is expressly stipulated in the overseas employment contract that a specific foreign law shall
govern;
2. That the foreign law invoked must be proven before the courts pursuant to the Philippine rules on
evidence;
3. That the foreign law stipulated in the overseas employment contract must not be contrary to law,
morals, good customs, public order, or public policy of the Philippines;
4. That the overseas employment contract must be processed through the POEA.

The Court is of the view that these four (4) requisites must be complied with before the employer
could invoke the applicability of a foreign law to an overseas employment contract. With these requisites,
the State would be able to abide by its constitutional obligation to ensure that the rights and well-being of
our OFWs are fully protected. Lacking any one of the four requisites would invalidate the application of
the foreign law, and the Philippine law shall govern the overseas employment contract.
In the present case, as correctly held by the CA, even though an authenticated copy of the ESA
was submitted, it did not mean that said foreign law could be automatically applied to this case. The
petitioners miserably failed to adhere to the two other requisites. The petitioners failed to comply with the
first requisite because no foreign law was expressly stipulated in the overseas employment contract with
Arriola.
 The petitioners did not directly cite any specific provision or stipulation in the said labor contract
which indicated the applicability of the Canadian labor laws or the ESA. They failed to show on the face
of the contract that a foreign law was agreed upon by the parties. Rather, they simply asserted that the
terms and conditions of Arriola’s employment were embodied in the Expatriate Policy, Ambatovy Project
- Site, Long Term.
The provisions of the ESA are patently inconsistent with the right to security of tenure. Both the
Constitution and the Labor Code provide that this right is available to any employee. In a host of cases,
the Court has upheld the employee's right to security of tenure in the face of oppressive management
behavior and management prerogative. Security of tenure is a right which cannot be denied on mere
speculation of any unclear and nebulous basis.
Furthermore, not only do these provisions collide with the right to security of tenure, but they
also deprive the employee of his constitutional right to due process by denying him of any notice of
termination and the opportunity to be heard.
In fine, as the petitioners failed to meet all the four (4) requisites on the applicability of a foreign
law, then the Philippine labor laws must govern the overseas employment contract of Arriola.

FALLO
WHEREFORE, the petition is DENIED. The January 24, 2013 Decision of the Court of Appeals in CA-
G.R. SP No. 118869 is AFFIRMED in toto.
MARIO C. MADRIDEJOS v. NYK-FIL SHIP MANAGEMENT, GR No. 204262, 2017

Topic: Principle of Protection to Labor without Destruction or Oppression of Capital

(claim of disability benefits)
FACTS:
Petitioner Madridejos was a Filipino seafarer hired by respondent NYK-Fil Ship Management,
Inc. (NYK-FIL), a registered local manning agency operating by virtue of Philippine laws for its foreign
principal, International Cruise Services, Limited. On April 10, 2010, Madridejos commenced to work
aboard the vessel. Two (2) weeks after, or on April 28, 2010, he claimed that he suddenly slipped on a
metal stairway and fell down, hitting his abdomen and chest on a metal pipe. He was brought to the ship
doctor and was diagnosed to have a "sebaceous cyst to the right of the umbilicus."
The next day, Madridejos was treated at Spire Southampton Hospital in Hampshire, England.
Under a local anesthesia, his cyst was removed, and the lesion was closed with three (3) stitches. After
two (2) months, or on July 5, 2010, NYK-FIL terminated Madridejos' services through its foreign
principal. Madridejos was repatriated to the Philippines on July 6, 2010
On July 6, 2010, he arrived in Manila, Philippines. The following day, he allegedly reported to
NYK-FIL "for a medical referral to the company doctor." However, he did not get any referral letter since
he was told that his illness was not work-related. Due to persistent symptoms, he was purportedly
constrained to undergo medical examinations by Physician-Surgeon Dr. Aylmer F. Españo (Dr. Españo)
from Metropolitan Medical Center. Madridejos claimed that he also engaged the services of Dr. Eduardo
Yu (Dr. Yu), an internist and specialist at Mary Chiles General Hospital. He was then prompted to file a
complaint "for disability benefits,

ISSUES:
WON Madridejos is entitled to disability benefits.
RULING:
No. Madridejos cannot claim disability benefits since he was not medically repatriated.
Madridejos insists that he suffered an injury in his upper extremities due to an accident that he had
encountered "while doing grinding works . . . on board the vessel." He alleges that this incident had
caused the development of his cyst.
Madridejos has not enumerated either the scope of his job or his regular tasks as a Demi Chef that
would supposedly show the correlation of his employment to the development of his cyst. Similarly, he
has failed to provide this Court with an overview of significant working conditions that might have
possibly contributed to the acquisition or aggravation of his illness.
Instead, he has merely made sweeping assertions about it. Regrettably, Madridejos has failed to
prove that the development of cyst was due to the nature of his job as a Demi Chef. For this reason, this
Court cannot presuppose that it is work-related.
 Furthermore, it was already settled that Madridejos was not repatriated due to his alleged medical
condition but due to the expiration of his contract as a probationary employee. For this reason, therefore,
it becomes unnecessary for NYK-FIL to overcome the disputable presumption that Madridejos' illness
was work-related.
"A seafarer only needs to pass the mandatory [Pre-Employment Medical Examination] in order to
be deployed on duty at sea."A Pre-Employment Medical Examination 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.
Given that Madridejos' repatriation was due to the termination of his service contract there was no
bad faith on the part of NYK-FIL. Accordingly, we deny Madridejos' claim for moral damages and
attorney's fees.

Principles:
Illnesses not listed as an occupational disease 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 are disputably presumed to be work-related.[1]
However, 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.
The Constitutional mandate in providing full protection to labor "is not meant to be a sword to
oppress employers." This Court's assurance to this policy does not stop us from upholding "the employer
when it is in the right." Thus, when evidence contradicts compensability, the claim cannot prosper,
otherwise it "causes injustice to the employer.

FONTANA DEV’T CORP. vs. SASCHA VUKASINOVIC, GR No. 222424, 21 Sep 2016

Topic: Principle of Protection to Labor without Destruction or Oppression of Capital

(Forum Shopping)
FACTS
 In July 2009, respondent Sascha Vukasinovic was hired by petitioner Fontana Development
Corporation (FDC) as its Director for Business Development for one year. His employment was renewed
for another year at the end of his first contract.
Sometime in May 2010, he allegedly received a text message from one Jenny Mallari (Mallari)
informing him that Nestor Dischoso (Dischoso) and Chief Hotel Engineer Jaime Villareal (Engr.
Villareal), both officers of petitioner FDC, were receiving commissions from company transactions.
Thereafter, respondent met with Mallari and offered her money in exchange for evidence that will
support her allegations. Mallari handed over to respondent a photocopy of a check issued to Engr.
Villareal, as proof of receiving commission. The check, however, had an alteration so respondent asked
Mallari to execute an affidavit and provide more proof. Respondent then paid Mallari the total amount of
fourteen thousand pesos (P14,000) on different occasions.
Mallari eventually gave respondent two invoices issued by one of the suppliers of petitioner FDC
as proof of her allegations. Again, respondent discovered discrepancies. Consequently, in his Inter-Office
Memorandum dated June 7, 2010, respondent recommended to Dennis Pak, petitioner FDC's General
Manager, to conduct further investigations on the alleged corruptions of Engr. Villareal.
On June 15, 2010, FDC's Safety and Security Department brought Engr. Villareal and Mallari to
the National Bureau of Investigation (NBI) Office for questioning. During the inquiry, Mallari denied that
Engr. Villareal asked for commissions from her and revealed that she merely fabricated the story against
Engr. Villareal so that she can ask money from respondent.
Petitioner FDC received a complaint from Engr. Villareal claiming that respondent paid Mallari a
substantial amount of money to concoct a story depicting Engr. Villareal as a corrupt employee. On
October 2, 2010, respondent received a Show Cause/Preventive Suspension Order from petitioner FDC's
Human Resources Department, informing him of the complaint filed by Engr. Villareal and directing him
to explain why no disciplinary action should be taken against him for violating the provisions of the
Company Code of Conduct on Dishonesty.
Respondent did not deny the allegations against him and, instead, admitted that he gave money to
Mallari because "it is a common practice in Fontana to give money to informants for vital information."
Thus, petitioner FDC approved the recommendation of the Investigating Panel and terminated
respondent's employment after finding him guilty of acts of dishonesty in the form of "bribery in any
form or manner". Respondent filed a complaint for illegal dismissal.
On June 27, 2011, Labor Arbiter Bactin dismissed the complaint for lack of factual or legal basis,
and ruled that respondent cannot be regularized as he is an employee with a legal and valid fixed-term
employment and that his dismissal was for a just cause. Upon appeal, the NLRC dismissed the appeal and
affirmed the Decision of Labor Arbiter Bactin. In so ruling, the NLRC noted that respondent had
previously filed another complaint before the same branch of the NLRC in San Fernando, Pampanga,
involving the same facts, issues, and prayer.
Respondent then filed a petition for certiorari with the CA. The CA agreed with the NLRC when
it ruled that herein respondent's employment had not ripened into regular employment and that he was
validly dismissed. Respondent, being a managerial employee, can be terminated on the ground of loss of
trust and confidence.
However, contrary to the Decision of the NLRC, the CA ordered the award of unpaid salaries to
respondent. The CA held that petitioner FDC failed to present evidence to show payment of the salaries
of respondent for the period claimed.
 Petitioners filed a petition for review before this Court, contending that the CA erred in not
dismissing outright respondent's petition. They claim that given the final decision, wherein all the
elements of litis pendentia were found, the CA should have refused to take cognizance of the case.

ISSUE:
WON the CA gravely erred in not dismissing the petition of the respondent for deliberate forum
shopping.
RULING:
Yes. The CA gravely erred in not dismissing the petition of the respondent outright. The test for
determining the existence of forum shopping is whether a final judgment in one case amounts to res
judicata in another. Or whether the following elements of litis pendentia are present:
a) identity of parties, or at least such parties as representing the same interests in both actions;
b) identity of rights asserted and reliefs prayed for, the relief being founded on the same facts; and
c) the identity of the two preceding particulars, such that any judgment rendered in the other action
will, regardless of which party is successful, amount to res judicata in the action under
consideration. Said requisites are also constitutive of the requisites for lis pendens.
It is well-settled that once there is a finding of forum shopping, the penalty is summary dismissal not
only of the petition pending before this Court, but also of the other case that is pending in a lower court.
This is so because twin dismissal is the punitive measure to those who trifle with the orderly
administration of justice.