PEOPLE OF THE PHILIPPINES (PEOPLE) V.

ANGEL MATEO (MATEO) (3) Accused committed the same against three or more persons individually or as a group. It
GR NO. 198012, APR 22, 2015 was established that there were five complainants. Clearly, the existence of the offense of
illegal recruitment in large scale was duly proved by the prosecution.
DOCTRINE:
MONEY IS NOT MATERIAL TO A PROSECUTION FOR ILLEGAL RECRUITMENT CONSIDERING THAT THE DEFINITION OF
"ILLEGAL RECRUITMENT" UNDER THE LAW INCLUDES THE PHRASE "WHETHER FOR PROFIT OR NOT Mateo's argument that there was no proof that they received money from Manuel et al is
baseless. Money is not material to a prosecution for illegal recruitment considering that the
definition of "illegal recruitment" under the law states "whether for profit or not."
FACTS:
1. Sometime during the period from January to March 1998, the five private complainants,
As regards estafa, well-settled is the rule that a person convicted for illegal recruitment under
namely, Abel, Emilio, Victorio, Manuel, and Virgilio met appellants on separate occasions
the law may, for the same acts, be separately convicted for estafa under Article 315 RPC. The
at Plaza Ferguzon, Malate, Manila to apply for overseas employment.
elements of estafa are: (1) the accused defrauded another by abuse of confidence or by means
of deceit; and (2) the offended party or a third party suffered damage or prejudice capable of
2. Mateo represented himself to have a tie-up with some Japanese firms, and promised pecuniary estimation." All these elements are likewise present in this case.
them employment in Japan as conversion mechanics, welders, or fitters for a fee. He
assured their departure after three weeks’ time as direct hires.
DISPOSITION: Appeal dismissed
3. However, after the private complainants paid the required fees ranging from P18,555.00
to P25,000.00, Mateo failed to secure any overseas employment for them. Mateo likewise
failed to return private complainants' money.

4. Manuel went to the POEA and was given certification stating that Mateo was not licensed
to recruit applicants for overseas employment. So Manuel et al filed a case with the NBI
then the DOJ which subsequently found probable cause against appellants for large scale
illegal recruitment and estafa.

5. RTC found Mateo guilty of large scale illegal recruitment and estafa. CA affirmed the lower
court’s decision. Hence the appeal. Mateo argues now that there was no illegal
recruitment because there was no proof that they received money

ISSUE: Whether Mateo et al are guilty of large scale illegal recruitment

HELD AND RULING:

YES. The offense of illegal recruitment is present in this case. The elements of large scale are
the following:
(1) The person charged undertook any recruitment activity as defined under Section 6 of RA
8042. The RTC found appellants to have undertaken a recruitment activity when they promised
private complainants employment in Japan for a fee.
(2) Accused did not have the license or the authority to lawfully engage in the recruitment
of workers. The Certification issued by the POEA unmistakably reveals that appellants neither
have a license nor authority to recruit workers for overseas employment. Notably, appellants
never assailed this Certification.
People v. Gallo  With Gallo’s assurance that many workers have been sent abroad, as well
G.R. No. 187730 as the presence of the two (2) Korean nationals and upon being shown the
visas procured for the deployed workers, Dela Caza was convinced to part
June 29, 2010
with his money and paid the placement fee.
TOPIC: Recruitment and Placement of Workers  Two (2) weeks after paying MPM Agency, Dela Caza went back to the
PONENTE: VELASCO, JR., J agency’s office in Malate, Manila only to discover that the office had
FACTS: moved to a new location at Batangas Street, Brgy. San Isidro, Makati.
 He proceeded to the new address and found out that the agency was
renamed to New Filipino Manpower Development & Services, Inc. (New
 Originally, accused-appellant Gallo, Pacardo and Manta, together with Mardeolyn
Filipino).
Martir (Mardeolyn) and nine (9) others, were charged with syndicated illegal
 He was informed that the transfer was done for easy accessibility to clients
recruitment and eighteen (18) counts of estafa committed against eighteen
and for the purpose of changing the name of the agency.
complainants, including Dela Caza, Guantero, and Sare.
 Dela Caza decided to withdraw his application and recover the amount he
 The cases were respectively docketed as Criminal Case Nos. 02-2062936 to 02- paid but respondents talked him out from pursuing his decision. On the
206311. other hand, accused-appellant Gallo even denied any knowledge about the
 Only the criminal case filed against Gallo, Pacanda, and Manta for syndicated illegal money.
recruitment and the case file for the same people for estafa proceeded to trial  After two (2) more months of waiting in vain to be deployed, Dela Caza and
because of the fact that the rest of the accused remained at large. (Criminal Case No. the other applicants decided to take action. Accused-appellant Gallo,
02-206293- syndicated illegal recruitment; 02-206297, 02-206300 and 02-206308- together with Pacardo and Manta, were then arrested.
estafa)  VERSION OF DEFENSE:
 The other cases were likewise provisionally dismissed. (02-206294 to 02-206296, 02-  Gallo denied having any part in the recruitment of Dela Caza.
206298 to 02-206299, 02-206301 to 02-206307 and 02-206309 to 02-206311)  Testified that he also applied with MPM Agency for deployment
 Pacardo and Manta were eventually dismissed for insufficiency of evidence. to Korea as a factory worker.
(Criminal Case Nos. 02-206293, 02-206297, 02-206300 and 02-206308)- same cases  In order to facilitate the processing of his papers, he agreed to perform
that proceeded to trial; bullet #3 some tasks for the agency, such as taking photographs of the visa and
 Likewise, Gallo was similarly acquitted in Criminal Case Nos. 02-206300, the case passport of applicants, running errands and performing such other tasks
filed by Guantero, and 02-206308, the case filed by Sare. assigned to him, without salary except for some allowance.
 Gallo, however, was found guilty beyond reasonable doubt for syndicated illegal  He only saw Dela Caza once or twice at the agency’s office when he applied
recruitment and estafa filed by Dela Caza. (Criminal Case Nos. 02-206293 and 02- for work abroad.
206297)  Lastly, that he was also promised deployment abroad but it never
 Thus, the present appeal concerns solely Gallo’s conviction for syndicated illegal materialized.
recruitment and estafa.
 VERSION OF PROSECUTION:
RTC: Convicted Gallo
 Dela Caza was introduced to Gallo, and other respondents at the office of
MPM International Recruitment and Promotion Agency (MPM Agency) CA: Affirmed Conviction
located in Malate, Manila.
 Dela Caza was told that respondents were officers and board members of ISSUE(S): WON Conviction was proper- YES
MPM Agency.
 Gallo then introduced himself as a relative of Mardeolyn (President of
MPM) and informed Dela Caza that the agency was able to send many RATIO:
workers abroad.  When illegal recruitment is committed by a syndicate or in large scale, i.e., if it is
 Together with Pacardo and Manta, he also told Dela Caza about the committed against three (3) or more persons individually or as a group, it is
placement fee of One Hundred Fifty Thousand Pesos (PhP 150,000) with a considered an offense involving economic sabotage. Under Art. 13(b) of the Labor
down payment of Forty-Five Thousand Pesos (PhP 45,000) and the balance Code, “recruitment and placement” refers to “any act of canvassing, enlisting,
to be paid through salary deduction. contracting, transporting, utilizing, hiring or procuring workers, and includes
referrals, contract services, promising or advertising for employment, locally or
 abroad, whether for profit or not.” or inferred from the acts of the accused pointing PEOPLE v SISON
to a joint purpose and design, concerted action and community of interest. As such, PEOPLE OF THE PHILIPPINES vs. ERLINDA A. SISON
all the accused, including accused-appellant, are equally guilty of the crime of illegal G.R. No. 187160, August 9, 2017
recruitment since in a conspiracy the act of one is the act of all. To reiterate, in
establishing conspiracy, it is not essential that there be actual proof that all the CARPIO, J.:
conspirators took a direct part in every act. It is sufficient that they acted in concert
pursuant to the same objective. Facts: Casuera and Magalona met appellant and the latter briefed Castuera on the
 After a thorough review of the records, we believe that the prosecution was able to requirements for working as a fruit picker in Australia. She introduced Castuera to another
establish the elements of the offense sufficiently. The evidence readily reveals that man who related that he was able to go to Australia with her help. She also showed Castuera
MPM Agency was never licensed by the POEA to recruit workers for overseas pictures of other people she had supposedly helped to get employment in Australia. Appellant
employment. further narrated that a couple she had helped had given her their car as payment. Because of
her representations, Castuera believed in her promise that she could send him to Australia.
In the instant case, accused-appellant committed the acts enumerated in Sec. 6 of R.A. 8042. Appellant asked Castuera for ₱180,000 for processing his papers.
Testimonial evidence presented by the prosecution clearly shows that, in consideration of a
promise of foreign employment, accused-appellant received the amount of Php 45,000.00 Appellant, however, failed to secure an Australian visa for Castuera. Together with Dedales
from Dela Caza. When accused-appellant made misrepresentations concerning the agency’s and Bacomo, appellant convinced Castueara that that it was difficult to get an Australian visa
purported power and authority to recruit for overseas employment, and in the process, in the Philippines so they had to go to Malaysia or in Indonesia to get one. Subsequently,
collected money in the guise of placement fees, the former clearly committed acts constitutive Castuera's application for an Australian visa in Indonesia was denied. Dedales asked for
of illegal recruitment. US$1,000 for the processing of his U.S. visa, which he paid. However, when his U.S. visa came,
Castuera saw that it was in an Indonesian passport bearing an Indonesian name. Because of
this, Castuera decided to just return to the Philippines.

Issue: Whether or not appellant is guilty of syndicated estafa.

Ruling: Yes. Illegal recruitment is deemed committed by a syndicate carried out by a group of
three (3) or more persons conspiring or confederating with one another. Under RA 8042, a
non-licensee or non-holder of authority commits illegal recruitment for overseas employment
in two ways: (1) by any act of canvassing, enlisting, contracting, transporting, utilizing, hiring,
or procuring workers, and includes referring, contract services, promising or advertising for
employment abroad, whether for profit or not; or (2) by undertaking any of the acts
enumerated under Section 6 of RA 8042.

In this case, appellant herself admits that she has no license or authority to undertake
recruitment and placement activities. Since it was proven that the three accused were acting
in concert and conspired with one another, their illegal recruitment activity is considered done
by a syndicate, making the offense illegal recruitment involving economic sabotage.

Ratio Decidendi: It is not essential that there be actual proof that all the conspirators took a
direct part in every act.
PEOPLE v MATHEUS G.R. No. 81510 March 14, 1990
PEOPLE OF THE PHILIPPINES vs. MERCEDITAS MATHEUS DELOS REYES HORTENCIA SALAZAR, petitioner, vs. HON. TOMAS D. ACHACOSO, in his capacity as
Administrator of the Philippine Overseas Employment Administration, and FERDIE
G.R. No. 198795, June 7, 2017 MARQUEZ, respondents.
Topic: Enforcement and Sanctions
TIJAM, J.:

Facts: Appellant was charged with six counts of Estafa in an Information which alleges that Doctrine:
accused conspiring together with other unidentified accused, feloniously defraud the
complainants on different occasions, by means of false manifestations and fraudulent Facts:
representation to the effect that they had the power and capacity to recruit and employ the
1. Rosalie Tesoro filed with the POEA a complaint against petitioner Salazar, as Salazar
complainants for employment abroad, and could facilitate the processing of the pertinent
refused to return Tesoro’s PECC Card and that Salazar had not license to operate a
papers if given the necessary amount to meet the requirements thereto, and succeeded in
recruitment agency, and that he was committing acts prohibited by Art. 34 in rel. Art
inducing said complainants to give and deliver, as in fact gave and delivered to said accused
38 of the Labor Code. Having ascertained such allegations, public respondent
the sum of money, which amount once in possession, with intent to defraud, willfully,
Administrator Tomas D. Achacoso issued thechallenged CLOSURE AND SEIZURE
unlawfully and feloniously misappropriated, misapplied and converted to their own personal
ORDER.
use and benefit, to the damage and prejudice of the complainants.
2. The POEA brought a team to the premises of Salazar to implement the order, assisted
For her part, appellant admitted that she was the Overseas Marketing Director of All Care by the Manadaluyong policemen and mediamen of People’s Journal and News
Travel & Consultancy, with All Care Travel & Consultancy as its affiliate. She claimed that she Today. There it was found that Salazar was operating Hannalie Dance Studio.
did not know Suratos, Guillarte, Alayon, Bagay, Jr., and Gloria. She likewise claimed that she 3. Before entering the place, the team served said Closure and Seizure order on a
neither signed nor issued any receipt using the name "Manzie delos Reyes" in favor of the certain Mrs. Flora Salazar who voluntarily allowed them entry into the premises.
complainants. She further claimed that she was not engaged in any recruitment and placement Mrs. Flora Salazar informed the team that Hannalie Dance Studio was accredited
activities. During the pre-trial, she admitted that she had no license to recruit workers for with Moreman Development (Phil.). However, when required to show credentials,
overseas employment. she was unable to produce any.
4. Inside the studio, the team chanced upon twelve talent performers, practicing a
Issue: Whether or not appellant is guilty for the crime of estafa. dance number and about twenty more waiting outside. The team confiscated
assorted costumes which were duly receipted for and witnessed by Mrs. Flora
Ruling: Yes. The elements of estafa are: (1) the accused defrauded another by abuse of Salazar.
confidence or by means of deceit; and (2) the offended party or a third party suffered damage 5. A few days after, petitioner filed a letter with the POEA demanding the return of the
or prejudice capable of pecuniary estimation. confiscated properties. They alleged lack of hearing and due process, and that since
the house the POEA raided was a private residence, it was robbery, as they abused
Here, appellant deceived private complainants into believing that she had the authority and their color of authority.
capability to send them abroad for employment, despite her not being licensed by the POEA 6. Salazar then filed this suit for prohibition. Although the acts sought to be barred are
to recruit workers for overseas employment. Because of the assurances given by accused- already fait accompli, thereby making prohibition too late, SC considers the petition
appellant, the private complainants parted with their hard-earned money for the payment of as one for certiorari in view of the grave public interest involved.
the agreed placement fee, for which accused-appellant issued petty cash vouchers and used
fictitious names evidencing her receipt of the payments. ISSUE: W/N the POEA (or the Secretary of Labor) can validly issue warrants of search and
seizure (or arrest) under Article 38 of the Labor Code?
Ratio Decidendi: A person, for the same acts, may be convicted separately of illegal
recruitment and estafa. HELD: No.
1. According to the Constitution, only a judge may issue warrants of search and
arrest. Neither may it be done by a mere prosecuting body. Allowing persons or
bodies other the judge will make such body both judge and jury in his own right. Such
would be unconstitutional.
 2. Sec. 38 of the Labor Code takes its roots from P.D. No. 2018, promulgated by Pres. Serrano v. Gallant Maritime Services
Marcos, which gives the Labor Minister search and seizure powers, in addition to G.R. No. 16714 March 24, 2009 Austria-Martinez, J.
arrest and closure powers. However, such decree stands as one of the dying vestiges
of authoritarian rule in tis twilight moments.
3. The Secretary of Labor, not being a judge, may no longer issue search or arrest DOCTRINE: The subject clause creates a sub-layer of discrimination between two types of
warrants. Hence, the authorities must go through the judicial process. To that extent, OFWs, imposing a burden on those who have employment contracts of one year or more.
we declare Article 38, paragraph (c), of the Labor Code, unconstitutional and of no Without any definitive governmental purpose, there is no valid classification and hence the
force and effect. equal protection clause is violated.
4. Moreover, the search and seizure order in question, assuming, ex gratia argumenti,
that it was validly issued, is clearly in the nature of a general warrant. A warrant must FACTS: Serrano was hired by Gallant and Marlow under an employment contract for 12 months
identify clearly the things to be seized, otherwise, it is null and void. (March 1998 to March 1999) as Chief Officer with a salary of $1,400/month. On the date of his
5. For the guidance of the bench and the bar, we reaffirm the following principles: departure, he was downgraded to Second Officer with a salary of $1,000/month with the
a. Under Article III, Section 2, of the l987 Constitution, it is only judges, and assurance that he would be restored to Chief Officer after a few weeks. He was never made
no other, who may issue warrants of arrest and search: Chief Officer and he refused to stay. He was repatriated to the Philippines. At the time he had
b. The exception is in cases of deportation of illegal and undesirable aliens, served only 2 months and 1 week of his contract. Complaint for constructive dismissal.
whom the President or the Commissioner of Immigration may order
arrested, following a final order of deportation, for the purpose of
LA declared the dismissal illegal. NLRC lowered the award on the basis that RA 8042 does not
deportation.
provide for the award of overtime pay, which should be proven to have been actually
performed, and for vacation leave pay. In the MR, Serrano questioned the constitutionality of
WHEREFORE, the petition is GRANTED. Art. 38, par. (c) of the Labor Code is the subject clause of RA 8042 for limiting recovery of backwages to only 3 months. NLRC
UNCONSTITUTIONAL. denied. CA affirmed the ruling.

Hence this petition. Petitioner argues that local employers are not limited to the amount of
backwages they must give their illegally dismissed employees. However under the subject
clause, foreign employers are only liable for up to 3 months of unpaid salaries notwithstanding
the unexpired term of the contract that may exceed 3 months. (Serrano eventually withdrew
because of his old age but SC resolved the question of constitutionality)

ISSUE:
1. W/N the subject clause of RA 8042 is unconstitutional for unduly impairing the
freedom of OFWs to negotiate the period and salary of their employment contracts
– NO
2. W/N the subject clause violates constitutional provisions on labor as a protected
sector – YES

HELD:
1. Sec. 10, Art. III of the Constitution provides that “No law impairing the obligation of contracts
shall be passed”. The prohibition is aligned with the prospectivity of laws, which cannot affect
contracts passed prior to their enactment. The non-impairment clause is limited in application
to laws yet to
be enacted that would derogate from already existing acts or contracts.
RA 8042 was enacted in 1995, and hence preceded the execution of Serrano’s and Gallant’s The subject clause creates a sub-layer of discrimination among OFWs whose contract periods
contract in 1998. It could not be argued that the said contract was impaired by a succeeding are for more than one year - Illegally dismissed OFWs with less than one year left are entitled
law. When the parties executed their 1998 contract, the provisions of RA 8042 were deemed to the entire unexpired portion; while those with one year or more remaining are covered by
incorporated therein. the subject clause and their monetary benefits limited to three months only. It also
discriminates between OFWs and local workers. The subject clause contains a suspect
classification in that, in the computation of the monetary benefits of fixed-term employees
Even disregarding the timeline, the law is a legitimate exercise of police power of the State to
who are illegally discharged, it imposes a 3-month cap on the claim of OFWs with an
regulate the recruitment and deployment of OFWs, to ensure respect for the dignity and well-
unexpired portion of one year or more in their contracts, but none on the claims of other
being of OFWs wherever they may be employed.
OFWs or local workers with fixed-term employment. The subject clause singles out one
classification of OFWs and burdens it with a peculiar disadvantage.
2. The subject clause reveals a discriminatory intent on OFWs at two levels: 1) OFWs with fixed
period employment contracts of less than one year vis-a-vis OFWs with contracts of one year
The subject clause does not state or imply any definite governmental purpose, but merely
or more; 2) among OFWs with contracts of more than one year; 3) OFWs vis-à-vis local workers
singles out OFWs who have employment contracts of one year or more, and burdens them
with fixed-period employment
with the subject clause. Without any valid classification, the subject clause is violative of the
equal protection clause.
First case:
ILLUSTRATION: OFW-A with an employment contract of 10 months at a monthly salary rate of PETITION GRANTED. Subject clause is declared unconstitutional.
US$1,000.00 and a hypothetical OFW-B with an employment contract of 15 months with the
same monthly salary rate of US$1,000.00. Both commenced work on the same day and under
the same employer, and were illegally dismissed after one month of work. Under the subject JUSTICE BRION’s Opinion
clause, OFW-A will be entitled to US$9,000.00, equivalent to his salaries for the remaining 9 The subject clause is unconstitutional, but for different reasons. It violates the constitutional
months of his contract, whereas OFW-B will be entitled to only US$3,000.00, equivalent to his provisions in favor of labor and substantive due process. There is no necessity in invoking the
salaries for 3 months of the unexpired portion of his contract, instead of US$14,000.00 for the equal protection clause. RA 8042 was enacted to establish a higher standard of protection and
unexpired portion of 14 months of his contract, as the US$3,000.00 is the lesser amount. promotion of the welfare of migrant workers, their families and of distressed overseas
Filipinos. Under these declared purposes, any provision therein, inimical to the interest of
OFWs, must be struck down.
Second case:
ILLUSTRATION: OFW-C and OFW-D, who each have a 24-month contract at a salary rate of
US$1,000.00 per month. OFW-C is illegally dismissed on the 12th month, and OFW-D, on the Prior to the law’s enactment, past rulings merited payment of OFWs’ salaries for the full
13th month. Considering that there is at least 12 months remaining in the contract period of unexpired portion of the employment contract regardless of period. The situation of illegally
OFW-C, the subject clause applies to the computation of the latter's monetary benefits. Thus, dismissed OFWs changed for the worse after RA 8042. Sec. 10, the subject clause, diminished
OFW-C will be entitled, not to US$12,000,00 or the latter's total salaries for the 12 months rather than enhanced the constitutional protection for labor and OFWs. It further affects laid
unexpired portion of the contract, but to the lesser amount of US$3,000.00 or the latter's down rules on solidary liability between the foreign principal and the recruitment/placement
salaries for 3 months out of the 12-month unexpired term of the contract. On the other hand, agency, by limiting recovery in illegal dismissal situations. Though read as a grant of incentives
OFW-D is spared from the effects of the subject clause, for there are only 11 months left in the to the agencies to encourage greater efforts at recruitment, it instead operates to mitigate
latter's contract period. Thus, OFW-D will be entitled to US$11,000.00, which is equivalent to liability for illegal dismissals.
his/her total salaries for the entire 11-month unexpired portion.
The benefits accruing to recruitment agencies and their principals are taken from the pockets
Third case: of OFWs to whom the full salaries for the unexpired portion of the contract rightfully belong.
Principals and agencies thereby profit from the violation of the employees’ security of tenure.
Prior to the effectivity of RA 8042, illegally dismissed OFWs, regardless of employment period,
Lesser protection is afforded because of the lessened recovery, and renders a wrongful
were entitled to their salaries for the entire unexpired portions of their contracts. Their claims
dismissal of an OFW easier and less onerous to undertake.
were subject to a uniform rule of computation – Basic Salary x Unexpired Portion. They were
treated no differently from local workers.
No reason to even look into the equal protection clause, nor is there any indication that
Congress intended such classification between and among OFWs. Even assuming that a
classification resulted from the law, the classification should not immediately be characterized EASTERN ASSURANCE and SURETY CORPORATION v. SECRETARY OF LABOR
as a suspect classification that would invite the application of the strict scrutiny standard. The G.R. No. L-79436-50, January 17, 1990
disputed portion of Section 10 does not, on its face, restrict or curtail the civil and human rights
of any single group of OFWs. At best, the disputed portion limits the monetary award for
wrongful termination of employment a tort situation affecting an OFWs economic interest. This FACTS:
characterization and the unintended classification that unwittingly results from the incentive  J&B Manpower is an overseas employment agency registered with the POEA and Eastern
scheme under Section 10, render a strict scrutiny disproportionate to the circumstances to Assurance was its surety beginning January 2, 1985.
which it is applied.  From June 1983 to December 1985, 33 persons applied for overseas employment with J
& B. In consideration of promised deployment, complainants paid respondent various
amounts for various fees.
Classifications that result in prejudice to persons accorded special protection by the
 Because of non-deployment, the applicants filed separate complaints with the Licensing
Constitution require stricter judicial scrutiny. The use of a suspect classification label cannot
and Regulation Office of POEA against J & B for violation of Articles 32 and 34 (a) of the
depend solely on whether the Constitution has accorded special protection to a specified
Labor Code between the months of April to October 1985.
sector. While the Constitution specially mentions labor as a sector that needs special
protection, the involvement of or relationship to labor, by itself, cannot automatically trigger  The POEA Administrator issued an order in favor of complainants. EASCO was declared
a suspect classification and the accompanying strict scrutiny; much should depend on the jointly and severally liable with J & B to twenty-nine (29) complainants (only J&B is liable
circumstances of the case, on the impact of the illegal differential treatment on the sector for the other 4 complainants whose claims were transacted prior to the effectivity of the
involved, on the needed protection, and on the impact of recognizing a suspect classification bond). J&B was also ordered
on future situations.  On appeal by EASCO — J & B having taken no part in the proceeding despite due service
of summons — the judgment was modified by the Secretary of Labor. J & B was directed
to refund all thirty-three (33) complainants while EASCO was found jointly and severally
SAMEER v CABILES liable with J & B to refund nineteen (19) complainants.
 EASCO assailed the ruling, claiming that POEA and the Secretary of Labor have no
jurisdiction over non-employees (since the 33 were never employed, in short, no
employer-employee relations)

ISSUE(S): Whether EASCO can be held liable.

HELD: YES! Petition dismissed.

 EASCO contends that the POEA had no "adjudicatory jurisdiction" over the monetary
claims in question because the same "did not arise from employer-employee relations."
Invoked in support of the argument is Section 4 (a) of EO 797, which provides in part that
the POEA has original and exclusive jurisdiction over all cases, including money
claims, involving employer-employee relations arising out of or by virtue of any law or
contract involving Filipino workers for overseas employment.
 The complaints are however for violation of Articles 32 and 34 (a) of the Labor Code.
Article 32 and paragraph (a) of Article 34 read as follows:
Art. 32. Fees to be paid by workers—Any person applying with a private
fee-charging employment agency for employment assistance shall not be
charged any fee until he has obtained employment through its efforts or
has actually commenced employment. Such fee shall be always covered
with the approved receipt clearly showing the amount paid. The Secretary
of Labor shall promulgate a schedule of allowable fees.
Art. 34. Prohibited practices—It shall be unlawful for any individual, entity,
licensee, or holder of authority:
 a) To charge or accept, directly or indirectly, any amount greater than that STRONGHOLD INSURANCE v CA
specified in the schedule of allowable fees prescribed by the Secretary of
Labor, or to make a worker pay any amount greater than actually received
by him as a loan or advance; . . .
 The penalties of suspension and cancellation of license or authority are prescribed for
violations of the above quoted provisions, among others. And the Secretary of Labor has
the power under Section 35 of the law to apply these sanctions, as well as the authority,
conferred by Section 36, not only, to "restrict and regulate the recruitment and placement
activities of all agencies," but also to "promulgate rules and regulations to carry out the
objectives and implement the provisions" governing said activities. Pursuant to this rule-
making power thus granted, the Secretary of Labor gave the POEA "on its own initiative
or upon filing of a complaint or report or upon request for investigation by any aggrieved
person, . . . (authority to) conduct the necessary proceedings for the suspension or
cancellation of the license or authority of any agency or entity" for certain enumerated
offenses including —
1) the imposition or acceptance, directly or indirectly, of any amount of
money, goods or services, or any fee or bond in excess of what is
prescribed by the Administration, and
2) any other violation of pertinent provisions of the Labor Code and other
relevant laws, rules and regulations.
The Administrator was also given the power to "order the
dismissal of the case or the suspension of the license or authority
of the respondent agency or contractor or recommend to the
Minister the cancellation thereof."
 Implicit in these powers is the award of appropriate relief to the victims of the offenses
committed by the respondent agency or contractor, especially the refund or
reimbursement of such fees as may have been fraudulently or otherwise illegally
collected, or such money, goods or services imposed and accepted in excess of what is
licitly prescribed. It would be illogical and absurd to limit the sanction on an offending
recruitment agency or contractor to suspension or cancellation of its license, without the
concomitant obligation to repair the injury caused to its victims. It would result either in
rewarding unlawful acts, as it would leave the victims without recourse, or in compelling
the latter to litigate in another forum, giving rise to that multiplicity of actions or
proceedings which the law abhors.
 Though some of the cases were filed after the expiration of the surety bond agreement
between J&B and EASCO, notice was given to J&B of such anomalies even before said
expiration. In this connection, it may be stressed that the surety bond provides that notice
to the principal is notice to the surety. Besides, it has been held that the contract of a
compensated surety like respondent Eastern Assurance is to be interpreted liberally in
the interest of the promises and beneficiaries rather than strictly in favor of the surety.
Patricia Sto. Tomas v. Salac provisions of RA 8042 as void. Secretary Sto. Tomas petitioned for the annulment of
685 SCRA 245, 13 November 2012 the RTC judgment.
This case is a consolidation of the following cases: G.R. No. 152642, G.R. No. 152710, G.R. No.
167590, G.R. Nos. 182978-79, and G.R. Nos. 184298-99. ISSUE: Whether or not Sections 6, 7, 9, and 10 of RA 8042 are void.

G.R. No. 152642 and G.R. No. 152710 HELD: No, they are valid provisions.
In G.R. No. 152642, in 2002, Rey Salac et al, who are recruiters deploying workers abroad,  Section 6: The law clearly and unambiguously distinguished between licensed and
sought to enjoin the Secretary of Labor, Patricia Sto. Tomas, the POEA, and TESDA, from non-licensed recruiters. By its terms, persons who engage in “canvassing, enlisting,
regulating the activities of private recruiters. Salac et al invoked Sections 29 and 30 of the contracting, transporting, utilizing, hiring, or procuring workers” without the
Republic Act 8042 or the Migrant Workers Act which provides that recruitment agency in the appropriate government license or authority are guilty of illegal recruitment whether
Philippines shall be deregulated one year from the passage of the said law; that 5 years or not they commit the wrongful acts enumerated in that section. On the other hand,
thereafter, recruitment should be fully deregulated. RA 8042 was passed in 1995, hence, Salac recruiters who engage in the canvassing, enlisting, etc. of OFWs, although with the
et al insisted that as early as 2000, the aforementioned government agencies should have appropriate government license or authority, are guilty of illegal recruitment only if
stopped issuing memorandums and circulars regulating the recruitment of workers abroad. they commit any of the wrongful acts enumerated in Section 6.
Sto. Tomas then questioned the validity of Sections 29 and 30.  Section 7: The penalties are valid. Congress is well within its right to prescribed the
said penalties. Besides, it is not the duty of the courts to inquire into the wisdom
behind the law.
ISSUE: Whether or not Sections 29 and 30 are valid.
 Section 9: The Rules on Criminal Procedure, particularly Section 15(a) of Rule 110,
itself, provides that the rule on venue when it comes to criminal cases is subject to
HELD: The issue became moot and academic. It appears that during the pendency of this case existing laws. Therefore, there is nothing arbitrary when Congress provided an
in 2007, RA 9422 (An Act to Strengthen the Regulatory Functions of the POEA) was passed alternative venue for violations of a special penal law like RA 8042.
which repealed Sections 29 and 30 of RA 8042.  Section 10: The liability of corporate officers and directors is not automatic. To make
them jointly and solidarily liable with their company, there must be a finding that
G.R. 167590 they were remiss in directing the affairs of that company, such as sponsoring or
tolerating the conduct of illegal activities.
In this case, the Philippine Association of Service Exporters, Inc. (PASEI) questioned the validity
of the following provisions of RA 8042:
 Section 6, which defines the term “illegal recruitment”. PASEI claims that the G.R. 182978-79, and G.R. 184298-99
definition by the law is vague as it fails to distinguish between licensed and non- In this case, Jasmin Cuaresma, a nurse working in Saudi Arabia was found dead. Her parents
licensed recruiters; received insurance benefits from the OWWA (Overseas Workers Welfare Administration). But
 Section 7, which penalizes violations against RA 8042. PASEI argues that the penalties when they found out based on an autopsy conducted in the Philippines that Jasmin was raped
for simple violations against RA 8042, i.e., mere failure to render report or and thereafter killed, her parents (Simplicio and Mila Cuaresma) filed for death and insurance
obstructing inspection are already punishable for at least 6 years and 1 day benefits with damages from the recruitment and placement agency which handled Jasmin
imprisonment an a fine of at least P200k. PASEI argues that such is unreasonable; (Becmen Service Exporter and Promotion, Inc.).
 Section 9, which allows the victims of illegal recruitment to have the option to either The case reached the Supreme Court where the Supreme Court ruled that since Becmen was
file the criminal case where he or she resides or at the place where the crime was negligent in investigating the true cause of death of Jasmin ( a violation of RA 8042), it shall be
committed. PASEI argues that this provision is void for being contrary to the Rules of liable for damages. The Supreme Court also ruled that pursuant to Section 10 of RA 8042, the
Court which provides that criminal cases must be prosecuted in the place where the directors and officers of Becmen are themselves jointly and solidarily liable with Becmen.
crime or any of its essential elements were committed; Eufrocina Gumabay and the other officers of Becmen filed a motion for leave to intervene.
 Section 10, which provides that corporate officers and directors of a company found They aver that Section 10 is invalid.
to be in violation of RA 8042 shall be themselves be jointly and solidarily liable with
the corporation or partnership for the aforesaid claims and damages. PASEI claims
ISSUE: Whether or not Section is invalid.
that this automatic liability imposed upon corporate officers and directors is void for
being violative of due process.
 RTC Judge Jose Paneda of Quezon City agreed with PASEI and he declared the said
HELD: No. As earlier discussed, Section 10 is valid. The liability of Gumabay et al is not Datuman v. First Cosmopolitan Manpower and Services Inc.
automatic. However, the SC reconsidered its earlier ruling that Gumabay et al are solidarily G.R. No. 156029 November 14, 2008
and jointly liable with Becmen there being no evidence on record which shows that they were
personally involved in their company’s particular actions or omissions in Jasmin’s case.
DOCTRINE:
 The Court has time and again ruled that private employment agencies are held jointly
and severally liable with the foreign-based employer for any violation of the
recruitment agreement or employment contract. This joint and solidary liability
imposed by law against recruitment agencies and foreign employers is meant to
assure the aggrieved worker of immediate and sufficient payment of what is due.
Such is in line with the state policy to protect and alleviate the plight of the working
class.
 The signing of the substitute contracts with the foreign employer before the
expiration of the POEA approved contract and any continuation of petitioner’s
employment beyond the original 1 year term against the will of the petitioner are
continuing breaches of the original POEA-approved contract.
 The subsequently executed side agreement of an overseas contract worker with her
foreign employer which reduced his salary below the amount approved by the POEA
is void because it is against our existing laws, morals and public policy. The said side
agreement cannot supersede the terms of the standard employment contract
approved by the POEA.

FACTS:
 (1st contract) In 1989, First Cosmopolitan( FC) recruited, Datuman to work in Bahrain
as a saleslady for 370$ a month for 1 year.(As stated in Employment Contract)

 On April 17 1989, Datuman was deployed to Bahrain, however her employer,

Hussein, took her passport and instead of working a saleslady, she was forced to
work as a Domestic Helper with a salary of 40 Dinar equivalent only to 100$ contrary
to what was stated in her employment contract approved by POEA.

 (2nd Contract)On sept 1, 1989 she was compelled by Hussein to sign another
contract, transferring her to another employer as a housemaid with a salary 40 dinar,
for 2 years. She worked against her will, and even worked w/o compensation from
Sept 1991- April 1993.

 On May 1993, Datuman was able to return to the PH because of her employers
continued failure to pay her salary despite demand.
 In 1995, Datuman filed a complaint with POEA against FC for underpayment and
nonpayment of salary, vacation leave pay, and refund of plane ticket.

 While the POEA case was pending, she filed this case with the NLRC for
underpayment of salary for 1 yr and 6 mos. And non-payment of vacation pay and
refund of airfare.
  In its position paper with the LA, FC countered stating that petitioner agreed to work  The signing of the substitute contracts with the foreign employer before the
as a housemaid since it was the only position available, but it was not permitted by expiration of the POEA approved contract and any continuation of petitioner’s
POEA at that time. That they mutually agreed to submit the contract of employment employment beyond the original 1 year term against the will of the petitioner are
stating the false facts to the POEA. And that it was actually Datuman who herself continuing breaches of the original POEA-approved contract.
violated the terms of their contract, when she transferred to another employer
without its knowledge and approval. They also raised the defense of prescription of  To accepts the CA’s reasoning is to open the floodgates to even more abuse overseas
action since the claim was filed beyond the 3-year period from the time the right workers. Since the recruitment agency could easily escape its liability by merely
accrued reckoned from 1990/1991 colluding with foreign principals in substituting the approved contract such is
certainly contract to the State’s policy of extending protection and support overseas
 The LA, found FC liable for violating the terms of the employment contract and workers. RA 8042 explicitly prohibits the substitution or alteration to the prejudice
ordered to pay Datuman her salary differentials for 15 months’ worth 4k$ and her of the worker of employment contracts already approved by the DOLE from the time
plane ticket. of actual signing up to and including the period of the expiration of the same w/o
approval of the DOLE.

 NLRC affirmed the decision but reduced the award of salary differential stating that  FC’s contention that it was Datuman herself who violated the contract when she
the salary claims before MAY 1993 had already prescribed. The amount of the award signed another is untenable. Since the LA and NLRC which the CA did not disturb that
is now 2.9k$ the petitioner was forced to work long after the term of her original.

 THE CA reversed the NLRC and LA rulings stating that it is true that the 1991 POEA  The court cited the case of Placewell vs. Camote where they held that the
rules and regulations provide that the local agency is jointly and solidary liable with subsequently executed side agreement of an overseas contract worker with her
the employer for all claims and liability which may arise in connection with the foreign employer which reduced his salary below the amount approved by the POEA
implementation of the contract, however FC was only privy only to the 1st contract. is void because it is against our existing laws, morals and public policy. The said side
As such, FC liability is only until the expiration of the 1st contract on Sep 1991, but as agreement cannot supersede the terms of the standard employment contract
such those claims have already prescribed. approved by the POEA.

ISSUE(S): WON FC is still liable for the 2nd contract?  In this case the diminution of DAtuman’s salary from 370$ to US100$ is void for
violating the POEA approved contract which set the minimum standards, terms and
HELD: YES. condition of her employment. The solidary liability of FC with the the foreign
 The court cites SEC 1 of Rule II of the POEA rules and regulations which provides employer for the money claims continues although she was forced to sign another
clearly that the private employment agency shall assume joint and solidary liability contract, it is the terms of the original contract that shall govern the relationship of
with the Employer. Datuman and FC and the foreign employer.

 The Court has time and again ruled that private employment agencies are held jointly  The SC agrees with the LA and NLRC that the precepts of justice and fairness dictate
and severally liable with the foreign based employer for any violation of the that Datuman must be compensated for all months worked regardless the supposed
recruitment agreement or employment contract. This joint and solidary liability termination of the original contact in April 1990. It is undisputed that petitioner was
imposed by law against recruitment agencies and foreign employers is meant to compelled to render service till April 1993 and for the entire period that she worked
assure the aggrieved worker of immediate and sufficient payment of what is due. she should have been paid 370$ per month.
Such is in line with the state polcy to protect and alleviate the plight of the working
class.
 FC cannot disclaim liability for the acts of the foreign employer which forced
Datuman to remain employed in violation of our laws and under the most oppressive
 The CA disregarded the policy of the state in its reversal, the Court does not agree conditions on the allegation that it purportedly had no knowledge of, or participation
with the CA that the solidary liability extends only to the 1st contract. in, the contract unwillingly signed by Datuman abroad. The court cannot give
credence to this claim considering FC by its own allegations knew from the outset APQ Ship Management, Co. Ltd. vs Caseñas
that the contract submitted to the POEA for approval was not to be the real contract. [G.R. No. 197303 Date]
FC blithely admitted to submitting to the POEA a contract stating that the position
TOPIC: Joint and several liability of private employment agency/ manning agent and employer.
to be filled by Datuman is that of Saleslady although she was to be employed as a
domestic helper since the latter position was not approved for deployment by the PONENTE: Mendoza, J.
POEA at that time. FC’s evident bad faith and admitted circumvention of the laws FACTS:
and regulations on migrant workers belie its protestations of innocence and put  APQ, as Crew Management’s agent, hired Caseñas to work on the M/V Perseverance.
Datuman in a position where she could be exploited and taken advantage of The employment contract was for 8 months (June 2005 – February 2005).
overseas, as what indeed happened to her in this case
 Caseñas traveled to Florida to board M/V Perseverance, however the ship couldn’t
leave because it lacked the necessary documents. Thus, he was transferred to the
M/V Haitien Pride, which also couldn’t leave because of incomplete documents.

 While stuck there, he was not paid his salary and had to fend for himself.
Furthermore, his contract was extended to 26 months.

 Eventually the ship was able to leave port. During his time at sea, Caseñas became
weak and he tired easily. In August 2006, he began to suffer shortness of breath,
headache and chest pains. He also alleged that his wages remained unpaid.

 He was brought to the hospital in the Bahamas where he was diagnosed with
hypertension and given medication. He was then repatriated due to his condition
and he arrived in the Philippines on August 30, 2006.

 Back home, he reported to APQ for a post-employment medical exam where the
company-designated physician later diagnosed him with Ischemic Heart Disease
along with his hypertension. This was confirmed by 2 other doctors. He was declared
"unfit for sea service"; as a result, he was not able to work for more than 120 days
from his repatriation. Plus, he was advised to take maintenance medication for life.

 He demanded payment of permanent total disability benefits, sickness allowance

and medical expenses to which he was entitled under the POEA Standard
Employment Contract (POEA-SEC), but APQ refused to pay. It argued that it could
not be held liable for claims pertaining to the extended portion of the contract for it
did not consent to it

 He filed a complaint for permanent total disability benefits, reimbursement of

medical expenses, sickness allowance, non-payment of salaries representing the
extended portion of the employment contract, damages, and attorney's fees

 LA Decision – Ruled in Favor of APQ, held that the illness/disease suffered by Caseñas
was sustained while serving on board MV Haitien Pride, which was outside the
period of his contractual employment.
  NLRC Decision – Initially reversed the LA’s decision, but upon reconsideration by APQ cannot now feign ignorance of any extension of the contract and claim that it did not
APQ, reversed itself and upheld LA’s decision in favor of APQ. consent to it. Because it had knowledge of the extended contract, APQ is solidarily liable with
Crew Management for Caseñas’ claims. Caseñas is, therefore, entitled to the unpaid wages
 CA Decision – Set aside NLRC ruling and held that as far as Philippine law is during the extended portion of his contract.
concerned, APQ's contract of employment with Caseñas was concluded only at the
time of his repatriation on August 30, 2006. Thus Caseñas was entitled to his claims
because the illness was sustained within the duration of his employment contract.

 APQ appealed

ISSUE(S):
First Issue: Was Caseñas’ employment contract extended with the consent of APQ/Crew
Management?
Second Issue: Is APQ liable to Caseñas? [Main Issue]

HELD/RATIO:
First Issue:
Yes. In a nutshell, there are three (3) requirements necessary for the complete termination
of the employment contract: 1] termination due to expiration or other reasons/causes; 2]
signing off from the vessel; and 3] arrival at the point of hire.

In this case, there was no clear showing that Caseñas signed off from the vessel upon the
expiration of his employment contract, which was in February or April 2005. He did not arrive
either in Manila, his point of hire, because he was still on board the vessel MV Haitien Pride on
the supposed date of expiration of his contract. It was only on August 14, 2006 that he signed
off from MV Haitien Pride and arrived in Manila on August 30, 2006. (DO No. 4 and
Memorandum Circular No. 09, both series of 2000; deemed incorporated in the contract)

Second Issue:
Yes. APQ claims that as proof of its intention not to extend Caseñas’ contract, it already
arranged his plane ticket as early as January & February 2005, in anticipation of the expiration
of the contract, attaching the e-mail copy of the American Airlines E-ticket & Itinerary.

BUT the records show otherwise. The e-mail and e-ticket consistently relied upon by APQ
clearly showed that the e-ticket was issued on January 18, 2006. These e-mails and e-tickets
were sent by Crew Management to APQ. Crew Management also executed the letter, dated
February 24, 2006, addressed to DOLE-OWWA in response to the report of the wife of Caseñas
to DOLE regarding his repatriation. Crew Management stated in said letter, copy furnished
APQ, that it had already issued an air ticket to Caseñas, but he failed to claim it. Thus, these
communications reveal that APQ had actual knowledge that Caseñas continued working on
board the said vessel after February/April 2005.
PRINCESS JOY PLACEMENT AND GENERAL SERVICES, INC. (PJP) V. GERMAN A. BINALLA (BINALLA) 10. Binalla argued: (1) that he was “re-processed”1 (otherwise known as contract
G.R. NO. 197005, 4 JUNE 2014 substitution); (2) that he was made to work under an inferior contract; and (3) that Al
Adwani violated the terms of his four-year contract.
BRION, J.

11. PJP denied: (1) that it recruited and deployed Binalla for overseas employment; (2) that
DOCTRINE: CONTRACT SUBSTITUTION CONSTITUTES “ILLEGAL RECRUITMENT” UNDER ARTICLE 38(I) OF THE CODE.
Paguio and Lateo were not its employees registered with the POEA; (3) that it was not Al
Adwani’s Philippine agent, but CBM; and that it did not participate in the four-year; and
FACTS: (PLEASE REFER TO THE TITLE) (4) that it did not “reprocess” Binalla.
1. Binalla, a registered nurse, applied for overseas employment with PJP who referred him
to Paguio and Latea for processing of his papers. 12. LA: PJP and CBM solidarily liable to Binalla for having jointly undertaken Binalla’s
recruitment through “reprocessing.”
2. After completing his documentary requirements, he was told that he would be deployed 13. NLRC: No reprocessing.
to Al Adwani Hospital (Hospital) in Saudi Arabia. 14. CA: PJP failed to perfect an appeal for failure to comply with essential requirements. Only
ruled on the procedural aspect.
3. He signed a four-year contract with the Hospital as a staff nurse.
ISSUE: Is PJP Liable?
4. On the day of his departure, Paguio met Binalla at the airport and gave him a copy of his
employment contract, plane ticket, passport, and a copy of his Overseas Employment HELD:
Certificate from the POEA.
Yes. Substantial evidence shows that Binalla was employed by Al Adwani in Saudi Arabia
through a fraudulent scheme called “reprocessing” or contract substitution, which was
5. It was only after boarding his Saudi Arabia Airlines plane that he examined his papers and participated by PJP, CBM, Paguio, and Lateo.
discovered that CBM, and not PJP, was his deploying agency.
He worked under an employment contract whose terms were inferior to the terms
6. Under the contract certified by the POEA, his salary was supposed to be US$550.00 for certified by the POEA. Under the four-year contract he signed, he was paid only SR1500.00 or
twenty-four (24) months or for two years, instead of the $400 under the four-year US$400 a month; whereas, under the POEA-certified two-year contract, he was to be paid
contract that he signed. $550.00. The POEA-certified contract was the contract that governed Binalla’s employment
with Al Adwani as it was the contract that the Philippine government officially recognized and
7. Left with no choice as he was then already bound for Saudi Arabia, he worked under his which formed the basis of his deployment to Saudi Arabia. Clearly, the four-year contract
contract for only two years and returned to the Philippines. signed by Binalla substituted for the POEA-certified contract.

8. Upon returning, Binalla verified the 4-year contract with the POEA and learned that a Under the circumstances, Princess Joy is as liable as CBM and Al Adwani for the contract
DIFFERENT contract was certified, with CBM as the recruiting agency. He, thus, disowned substitution, no matter how it tries to avoid liability by disclaiming any participation in the
the contract and claimed that his signature was forged. recruitment and deployment of Binalla to Al Adwani. Before the labor arbiter, Princess Joy
claimed that Paguio and Lateo were not its employees/representatives or that the principal
piece of evidence relied upon by the labor arbiter, the “ticket/telegram/advise (sic)” handed
9. Thus, Binalla filed a complaint against local manning agent CBM, PJP, and the Hospital for to Binalla by Paguio had no probative value as it was merely an unsigned and unauthenticated
various money claims arising from his employment with Al Adwani. printout or that the four-year employment contract was signed only by Binalla and there was
no showing that it was the contract implemented by Al Adwani. DISPOSITION: PJP and CBM
solidarily liable to Binalla.

1
... an arrangement where PJP recruited and deployed him, but made it appear that it was
undertaken by CBM under a different contract submitted to and certified by the POEA.
FARLE P. ALMODIEL vs. NATIONAL LABOR RELATIONS COMMISSION (FIRST DIVISION), LA Daisy Cauton-Barcelona= Favored Almodiel. Termination on the ground of redundancy is
RAYTHEON PHILS., INC., highly irregular and without legal and factual basis, thus ordering the respondents to reinstate
G.R. No. 100641 June 14, 1993 complainant to his former position with full backwages without lost of seniority rights and
other benefits.

Facts:
NLRC= Reversed the decision of LA and directed Raytheon to pay petitioner the total sum of
• Petitioner Farle P. Almodiel is a CPA who was hired in October, 1987 as Cost
P100,000.00 as separation pay/financial assistance. Hence, this petition by Farle Almodiel.
Accounting Manager of respondent Raytheon Philippines, Inc. through a reputable placement
firm, John Clements Consultants, Inc. with a starting monthly salary of P18,000.00.
• Before said employment, he was the accounts executive of Integrated Issue: WON NLRC committed grave abuse when it declared his termination on the ground of
Microelectronics, Inc. for several years. He left his lucrative job therein in view of the promising redundancy as valid and justified. (NO.)
career offered by Raytheon.
o He started as a probationary or temporary employee. Held:
o As Cost Accounting Manager, his major duties were: (1) plan, coordinate and carry • Termination of an employee's services because of redundancy is governed by Article
out year and physical inventory; (2) formulate and issue out hard copies of Standard Product 283 of the Labor Code.
costing and other cost/pricing analysis if needed and required and (3) set up the written Cost • There is no dispute that petitioner was duly advised, one (1) month before, of the
Accounting System for the whole company. termination of his employment on the ground of redundancy in a written notice by his
o After a few months, he was given a regularization increase of P1,600.00 a month. immediate superior, Mrs. Magdalena B.D. Lopez sometime in the afternoon of January 27,
Not long thereafter, his salary was increased to P21,600.00 a month. 1989. He was issued a check for P54,863.00 representing separation pay but in view of his
• In 1988, he recommended and submitted a Cost Accounting/Finance Reorganization, refusal to acknowledge the notice and the check, they were sent to him thru registered mail
affecting the whole finance group but the same was disapproved by the Controller. on January 30, 1989. The Department of Labor and Employment was served a copy of the
notice of termination of petitioner in accordance with the pertinent provisions of the Labor
o However, he was assured by the Controller that should his position or department
Code and the implementing rules.
which was apparently a one-man department with no staff becomes untenable or unable to
deliver the needed service due to manpower constraint, he would be given a three (3) year • The crux of the controversy lies on whether bad faith, malice and irregularity crept
advance notice. in the abolition of petitioner's position of Cost Accounting Manager on the ground of
redundancy.
• In the meantime, the standard cost accounting system was installed and used at the
Raytheon plants and subsidiaries worldwide. It was likewise adopted and installed in the o PETITIONER claims that the functions of his position were absorbed by the
Philippine operations. Payroll/Mis/Finance Department under the management of Danny Ang Tan Chai, a resident
alien without any working permit from the Department of Labor and Employment as required
• As a consequence, the services of a Cost Accounting Manager allegedly entailed only
by law. Petitioner relies on the testimony of Raytheon's witness to the effect that corollary
the submission of periodic reports that would use computerized forms prescribed and
functions appertaining to cost accounting were dispersed to other units in the Finance
designed by the international head office of the Raytheon Company in California, USA.
Department. And granting that his department has to be declared redundant, he claims that
he should have been the Manager of the Payroll/Mis/Finance Department which handled
• In 1989, petitioner was summoned by his immediate boss and in the presence of IRD general accounting, payroll and encoding. As a B. S. Accounting graduate, a CPA with M.B.A.
Manager, Mr. Rolando Estrada, he was told of the abolition of his position on the ground of units, 21 years of work experience, and a natural born Filipino, he claims that he is better
redundancy. qualified than Ang Tan Chai, a B.S. Industrial Engineer, hired merely as a Systems Analyst
o He pleaded with management to defer its action or transfer him to another Programmer or its equivalent in early 1987, promoted as MIS Manager only during the middle
department, but he was told that the decision of management was final and that the same has part of 1988 and a resident alien.
been conveyed to the Department of Labor and Employment. o RESPONDENT insists that petitioner's functions as Cost Accounting Manager had not
• Thus, he was constrained to file the complaint for illegal dismissal before the been absorbed by Ang Tan Chai, a permanent resident born in this country. It claims to have
Arbitration Branch of the National Capital Region, NLRC, Department of Labor and established below that Ang Tan Chai did not displace petitioner or absorb his functions and
Employment. duties as they were occupying entirely different and distinct positions requiring different sets
of expertise or qualifications and discharging functions altogether different and foreign from
that of petitioner's abolished position. Raytheon debunks petitioner's reliance on the
testimony of Mr. Estrada saying that the same witness testified under oath that the functions founded on the ground that one has better credentials over the appointee is frowned upon so
of the Cost Accounting Manager had been completely dispensed with and the position itself long as the latter possesses the minimum qualifications for the position.
had been totally abolished. o In the case at bar, since petitioner does not allege that Ang Tan Chai does not qualify
• Whether petitioner's functions as Cost Accounting Manager have been dispensed for the position, the Court cannot substitute its discretion and judgment for that which is
with or merely absorbed by another is however immaterial.Thus, notwithstanding the dearth clearly and exclusively management prerogative. To do so would take away from the employer
of evidence on the said question, a resolution of this case can be arrived at without delving what rightly belongs to him.
into this matter.
• For even conceding that the functions of petitioner's position were merely SC= Petition DENIED.
transferred, no malice or bad faith can be imputed from said act.
• Indeed, an employer has no legal obligation to keep more employees than are
necessary for the operation of its business. Petitioner does not dispute the fact that a cost
accounting system was installed and used at Raytheon subsidiaries and plants worldwide; and
that the functions of his position involve the submission of periodic reports utilizing
computerized forms designed and prescribed by the head office with the installation of said
accounting system. Petitioner attempts to controvert these realities by alleging that some of
the functions of his position were still indispensable and were actually dispersed to another
department.
o What these indispensable functions that were dispersed, he failed however, to
specify and point out. Besides, the fact that the functions of a position were simply added to
the duties of another does not affect the legitimacy of the employer's right to abolish a position
when done in the normal exercise of its prerogative to adopt sound business practices in the
management of its affairs.
• Considering further that petitioner herein held a position which was definitely
managerial in character, Raytheon had a broad latitude of discretion in abolishing his position.
An employer has a much wider discretion in terminating employment relationship of
managerial personnel compared to rank and file employees. The reason obviously is that
officers in such key positions perform not only functions which by nature require the
employer's full trust and confidence but also functions that spell the success or failure of an
enterprise.
• Likewise destitute of merit is petitioner's imputation of unlawful discrimination
when Raytheon caused corollary functions appertaining to cost accounting to be absorbed by
Danny Ang Tan Chai, a resident alien without a working permit. Article 40 of the Labor Code
which requires employment permit refers to non-resident aliens.
o The employment permit is required for entry into the country for employment
purposes and is issued after determination of the non-availability of a person in the Philippines
who is competent, able and willing at the time of application to perform the services for which
the alien is desired. Since Ang Tan Chai is a resident alien, he does not fall within the ambit of
the provision.
• Petitioner also assails Raytheon's choice of Ang Tan Chai to head the
Payroll/Mis/Finance Department, claiming that he is better qualified for the position. It should
be noted, however, that Ang Tan Chai was promoted to the position during the middle part of
1988 or before the abolition of petitioner's position in early 1989. Besides the fact that Ang
Tan Chai's promotion thereto is a settled matter, it has been consistently held that an objection
WPP Marketing Communications, Inc. vs. Galera President as well because WPP’s By-Laws provided for only one Vice-President, a
position already occupied by private respondent Webster. The same defect also
G.R. No. 169207 – March 25, 2010 stains the Board of Directors’ appointment of petitioner GALERA as a Director of the
corporation, because at that time the By-Laws provided for only five directors. In
TOPIC: Conditions for Grant of Permit addition, the By-laws only empowered the Board of Directors to appoint a general
manager and/or assistant general manager as corporate officers in addition to a
DOCTRINE: chairman, president, vice-president and treasurer. There is no mention of a
corporate officer entitled "Managing Director.”
The law and the rules are consistent in stating that the employment permit must be acquired
Both parties filed for MRs but were denied. Hence this appeal.
prior to employment. The Labor Code states: "Any alien seeking admission to the Philippines
for employment purposes and any domestic or foreign employer who desires to engage an ISSUE: Whether or not Galera’s failure to secure a working permit prohibits her from seeking
alien for employment in the Philippines shall obtain an employment permit from the relief? – YES.
Department of Labor.
RULING:
FACTS:
 To grant Galera relief is to sanction the violation of the Philippine labor laws requiring
 Galera accepted the offer and subsequently signed an employment contract. Her aliens to secure work permits before their employment.
contract states that she is to have the position of Managing Director of Mindshare  We hold that the status quo must prevail in the present case and we leave the parties
Philippines. Her employment became effective on September 1, 1999 upon the where they are. This ruling, however, does not bar Galera from seeking relief from
instruction of the CEO and her signing of the contract without further action from other jurisdictions.
the Board of Directors of WPP.  The law and the rules are consistent in stating that the employment permit must be
 It was only 4 months after that WPP applied before the Bureau of Immigration a acquired prior to employment. The Labor Code states: "Any alien seeking admission
working visa for Galera where she was designated as the Vice President of WPP. to the Philippines for employment purposes and any domestic or foreign employer
Galera contends that she was constrained to sign the application so she can stay in who desires to engage an alien for employment in the Philippines shall obtain an
the Philippines and retain her employment. employment permit from the Department of Labor."
 On December 14, 2000 Galera was verbally terminated by Steedman (Chairman of
WPP), a termination letter followed the next day. Section 4, Rule XIV, Book 1 of the Implementing Rules and Regulations provides:
 On January 3, 2001, Galera filed a complaint for illegal dismissal with payment of o Employment permit required for entry. — No alien seeking employment,
holiday pay, service incentive leave pay, 13th month pay, incentive plan, actual and whether as a resident or non-resident, may enter the Philippines without
moral damages, and attorney’s fees against WPP and/or John Steedman (Steedman), first securing an employment permit from the Ministry. If an alien enters
Mark Webster (Webster) and Nominada Lansang (Lansang). the country under a non-working visa and wishes to be employed
 The Labor Arbiter ruled in favor of Galera and held that the respondents were liable thereafter, he may only be allowed to be employed upon presentation of
for illegal dismissal and damages. Galera was not only illegally dismissed but was also a duly approved employment permit.
deprived of due process (WPP- failed to observe the 2-notice rule)
 NLRC however reversed the ruling of the LA. It held that the Labor Arbiter had no  Galera cannot come to this Court with unclean hands. To grant Galera’s prayer is to
jurisdiction over the case because Galera was a Vice President or a corporate officer sanction the violation of the Philippine labor laws requiring aliens to secure work
at the time of dismissal. As such, it is an intra-corporate dispute which under P.D. permits before their employment. We hold that the status quo must prevail in the
No. 902-A, is within the jurisdiction of the SEC (now the commercial courts). present case and we leave the parties where they are. This ruling, however, does not
 Galera appealed the decision of the NLRC but it was denied. bar Galera from seeking relief from other jurisdictions.
 On Appeal, the CA reversed the decision of the NLRC. It held that the dismissal of
Galera’s appeal is not in accord with jurisprudence. A person could be considered a
"corporate officer" only if appointed as such by a corporation’s Board of Directors,
or if pursuant to the power given them by either the Articles of Incorporation or the
By-Laws. It further held that Galera could not have been validly appointed as Vice
G.R. No. 93666 April 22, 1991 GMS can't claim that Secretary's decision would amount to an impairment of the obligations
Gen. Milling Corp and Earl Cone, petitioners of contracts because Labor code requires alien employment permits to enter a contract of
employment for foreigners.
vs Hon. Torres in his capacity as secretary of Labor and Employment, et. al.
Ponente: Feliciano
GMC's contention that Secretary of labor should have deferred to the findings of Comm. On
Immigration and Deportation as to the necessity of employing Cone is also without basis. The
Facts: labor code specifically empowers secretary to make a determination as to the availability of
May 1989, the NCR-Dept.Labor and Employment issued Alien Employment permit in favor of the services of a person in the Philippines.
petitioner earl cone, a US citizen as sports consultant and assistant coach for GMC. Dec. 1989
then GMC and Cone entered into a contract of employment. Then January 1990, the board of
special inquiry of the commission and deportation approved Cone's application for a change
of admission status from temporary visitor to pre-arranged employee. On Feb. 1990, GMC
requested for renewal of Cone's alien employment permit which was granted by DOLE regional
director. The alien employment is valid until December 1990.

Private respondent BCAP appealed the issuance of said alien employment permit to the
secretary of labor who issued a decision ordering the cancellation of Cone's employment
permit on the ground that there was no showing that there is no person in the Philippines who
is competent, able and willing to perform the services required nor that the hiring of Cone
redound to the national interest.

GMC filed a motion for reconsideration and 2 supplemental motions for reconsideration but
were bothe denied by acting secretary Laguesma.

Issue:

GMC before the court on a petition for certiorari alleging that: (1) Secretary of Labor gravely
abused his discretion when he revoked the alien employment permit and (2) labor code does
not empower secretary to determine if the employment of an alien would redound to national
interest.

Ruling: Petition dismissed.

Court considers that petitioners have failed to show any grave abuse of discretion on the part
of secretary. The alleged failure to notify petitioners of the appeal filed by BCAP was cured
when petitioners were allowed to file their motion for reconsideration before secretary of
labor.

GMC's claim that hiring of a foreign coach is an employer's prerogative has no legal basis at all.
Under article 40 of labor code, an employment permit is required to hire a foreigner, as it
applies to "non-resident aliens".