Petitioner BSM Crew Service Centre Philippines, Inc.

hired Jones as Messman on board the vessel

Al Gattara under a nine-month contract covered by a CBA. In February 2015,
while loading food provisions on board the vessel, Jones felt a sudden snap in his back
followed by pain which radiated to his lower extremities. When his pain did not subside, he was
medically repatriated on March 17, 2015, and immediately referred to the companydesignated
physician. He underwent tests and a rehabilitation program, which included injection of epidural
steroid for pain management. On July 1, 2015, Jones undertook a functional capacity evaluation
where the company-designated physician certified that Jones is "pain free with full range of
motion." Jones signed a certificate declaring that he was "cleared to return to work."

According to Jones, he reported to BSM for re-employment but he was not re-engaged.
In 2016, as his back pain recurred, he consulted another doctor, Dr. Francis Pimentel, who
concluded, in a Medical Report that he was "not fit for work with permanent disability” because
his "facet joint hypertrophy has encroached on the exiting nerve root." Jones consulted another
physician who likewise found him to be unfit for sea duty.
The parties then underwent grievance proceedings before the Associated Marine Officers and
Seamen's Union of the Philippines, but no settlement was reached. Conciliation proceeding were
likewise commenced before the NCMB, but this also failed. After conciliation proceedings proved
futile, the case was sent to voluntary arbitration before the PVA-NCMB. The PVA-NCMB ordered
BSM to pay Jones permanent total disability compensation amounting to US$96,909.00, sickness
allowance totaling US$1,928.00, and attorney's fees. BSM filed a motion for reconsideration,
which was partly granted. The PVANCMB deleted the award of sickness allowance as the same
had already been paid.

BSM then filed a petition for review under Rule 43 before the CA. The CA dismissed
the petition and affirmed the PVA-NCMB's findings.

Jones is entitled to total and permanent disability benefits. As to the CA and the PVA-NCMB's
finding that Jones is entitled to total and permanent disability benefits, the
Court affirms the same but on a different basis.

Section 20(A) of the POEA-SEC finds no application to Jones's claim for disability benefits because
his illness manifested after the term of his employment contract. As the
Court held in Ventis Maritime Corporation v. Salenga: "Section 20(A) applies only if the
seafarer suffers from an illness or injury during the term of his contract, i.e., while he is
employed.” Here, it is undisputed that on July 1, 2015, Jones was already cleared to return to
work, and he even signed a certificate acknowledging this. Jones himself admitted to reporting to
BSM for re-employment but he was not re- employed. Therefore, his claim for disability benefits
because of his illness is no longer covered by Section 20(A) of the POEASEC. That said, Jones may
still claim for disability benefits but following a different set of rules and procedures not covered
by Section 20(A).

Applying Ventis, because Jones's low back pain is not listed in Section 32-A of the POEA-SEC, he
should prove that there is reasonable linkage between his low back pain and his work. He should
prove the risk involved in his work, his illness was a result of his
exposure to the risks, the disease was contracted within a period of exposure and under such
other factors necessary to contract it, and he was not notoriously negligent. Here, Jones, in his
Affidavit dated June 30, 2016, stated that his work as a Messman included considerable use of his
back.

The March 6, 2016 Report of his doctor stated that his low back pain was not responsive to
physical therapy and epidural steroid injection. As quoted above, the doctor found that the facet
joint hypertrophy has encroached on the exiting nerve root and that the encroachment will not
be resolved by steroid injection nor physical therapy and surgery was required to resolve it.
Further, the March 14, 2016 Medical Report states risk factors for developing low back pain
including an occupation that requires heavy lifting, a history of back injuries, lack of exercise and
carrying excess body weight.The foregoing convinces the Court that the nature of Jones's work as
a Messman or an "all-around man" exposed him to the risk of developing low back pain as he
was required to perform physical activities that required considerable use of his back. His doctors
also confirm that such activities exposed him to the risk of developing low back pain and given his
undisputed low back pain, he would no longer be able to perform activities that require the lifting
of heavy equipment. Finally, there is nothing on record to show that Jones was notoriously
negligent. Given this, Jones is entitled to total and permanent disability benefits.

Bautista was hired by respondent Eli Lilly Philippines, Inc. (ELPI) in 1998 as a Professional Sales
Representative. After several promotions, he was retrenched in 2003. He was rehired in 2005 and
last held the position of Sales and Marketing Services Manager in 2011. On November 4, 2011,
ELPI issued a Show-Cause Letter, charging Bautista with violation of the company rules and
breach of trust and confidence. Allegedly, on May 14,
2008, Bautista simulated the purchase of four tires from Babila Tire Supply (BTS) and claimed
reimbursement for the cost. He was placed under preventive suspension for 30 days.

ELPI did not reveal the source of the damning information against Bautista. Bautista submitted his
explanation and questioned ELPI's failure to identify the source of the damaging information. On
December 21, 2011, Bautista was issued a Notice of Termination, prompting him to file a
Complaint for illegal dismissal and suspension before the Labor Arbiter (LA).

ELPI failed to show a clear, valid and legal cause to dismiss Bautista. The pieces of evidence it
presented are riddled with inconsistencies and unexplained material facts that leave much to be
desired — leading the Court to arrive at the same conclusion arrived at by the NLRC, that is, that
Bautista's dismissal was indeed illegal. It is settled that the employer has the right to terminate
the services of an employee for a just or authorized cause. The dismissal of employees must,
however, be made within the parameters of law and pursuant to the tenets of fair play. In
termination disputes, the burden of proof is always on the employer to prove that the dismissal
was for a just or authorized cause

The records undisputedly show, however, that Arnulfo had issued another statement stating that
he lacked knowledge of the sale and that it was his wife who had issued the official receipt. Thus,
during the administrative proceedings that ELPI conducted, it had in its possession, the official
receipt, the sales invoice, the repairs request, Lilia's statement, and the two contradicting
statements of Arnulfo, as basis for its decision that Bautista committed dishonesty. The Court
finds that these pieces of evidence fail to prove that Bautista simulated the sale. To the mind of
the Court, there was no anomaly in Bautista's claim for reimbursement as this was supported by
documents.

Salenga was engaged by petitioner Ventis Maritime Corporation for its principal K Line Ship
management Co., Ltd., as Chief Cook for nine months on board the vessel MT Viking River. On
October 31, 2015, Salenga's contract expired and he disembarked in South Korea. After his arrival
in the Philippines, he went to Ventis to get his unpaid wages and asked to be referred to a
company physician for medical consultation. He was advised to wait for Ventis's call for his
medical examination. He, however, executed a Debriefing Sheet stating, among others, that he
had no complaints regarding the vessel and offered no suggestions to improve the working
conditions therein.
Salenga was referred to PMP Diagnostic Center in preparation for his line-up on board
his next embarkation and it was there that he was diagnosed by the company physicians with
Type II Diabetes Mellitus and Hypertension. As such, his documents for line-up were
withdrawn and he executed a Release and Quitclaim, releasing petitioners from all claims.After
he suffered from dizziness and chest pains, Salenga consulted a private physician, Dr. Erlinda
Bandong-Reyes, who eventually issued a certification that Salenga had cardiovascular disease and
Type II Diabetes Mellitus, and that he was permanently unfit for further sea duties and "entitled
under POEA Disability Grade 1

Salenga filed a complaint for disability benefits.

Section 20(A) applies only if the seafarer suffers from an illness or injury during the term of his
contract, i.e., while he is employed. In Sec. 20(A), the employer is obliged to continue to pay the
seafarer's wages, and to cover the cost of treatment and medical repatriation, if needed. After
medical repatriation, the seafarer has the duty to report to the companydesignated physician
within three days upon his return. The employer shall then pay sickness allowance while the
seafarer is being treated. Here, Salenga was repatriated because his contract had already ended.
Further, based on his own admissions, he did not suffer any illness while he was on board the
ship, and in fact, he failed to present any proof that his illnesses manifested while he was on
board the vessel. Hence, Section 20(A) of the POEA-SEC does not apply to him.

Even if Salenga's illnesses manifested or were discovered after the term of the contract, and even
if Section 20(A) finds no application to him, he may still claim disability benefits. In instances
where the illness manifests itself or is discovered after the term of the seafarer's contract, the
illness may either be (1) an occupational illness listed under Section 32-A of the POEA-SEC, in
which case, it is categorized as a work-related illness if it complies with the conditions stated in
Section 32-A, or (2) an illness not listed as an occupational illness under Section 32-A but is
reasonably linked to the work of the seafarer. Hence, Salenga was required to prove that there
was a reasonable linkage between his cardiovascular disease and diabetes, and his work as Chief
Cook to lead a rational mind to conclude that his work might have contributed to the
establishment of his illnesses.

here was no proof that as Chief Cook, he was exposed to toxic and hazardous materials. These
materials were not even specified. It was also not explained how these materials caused
Salenga's cardiovascular disease and diabetes. There was no proof that he contracted his illnesses
as a result of his exposure to risks involved in his work, and that he was not notoriously negligent.
The LA, NLRC, and CA all erred in awarding/total and permanent disability benefits to Salenga
when he failed to present substantial evidence to prove that his illnesses were work-related.
EBUS V. THE RESULTS CO., INC.
G.R. No. 244388, March 3, 2021, First Division (Caguioa, J.)
DOCTRINE
TRCI cannot hide behind the argument that its conduct was an exercise of management
prerogative as its actions prejudiced Ebus and it failed to provide a legitimate ground to put him
on TLO. Although the exercise of management prerogative will ordinarily not be interfered with,
it is not absolute and it is limited by law, collective bargaining agreement, and general principles
of fair play and justice. "Indeed, having the right should not be confused with the manner in
which that right is exercised."

FACTS
Ebus has been an employee of respondent The Results Company, Inc. (TRCI),a business process
outsourcing company, since August 13, 2012. He was hired as a sales representative and was
promoted several times until he became a Team Leader in 2014. As a Team Leader, Ebus had the
duty of supervising agents assigned to a program handling TRCI's US-based telecommunication
service provider. During Ebus's employment, he was recognized for his accomplishments and was
given various awards and travel incentives.
On December 30, 2014, Ebus received an email from John Christopher P. David (David),a
consultant of TRCI, informing him of two company infractions allegedly committed by one of
Ebus's agents — Ruby De Leon (De Leon). Allegedly, based on a quality call monitoring, De Leon
incorrectly processed a customer's order and failed to fully apprise the customer of the products
that TRCI offers. David recommended that coaching be provided to De Leon. Several program
managers, one of whom was Operations Manager
Summer Dombrowski (Dombrowski),were furnished a copy of the email.

On the same day, Dombrowski replied to the group email that a final written warning
must be given to De Leon, stating that De Leon's employment should be terminated if it
would be later found out that the same process has become a trend in past transactions.
However, the other program managers disagreed with Dombrowski and recommended only
coaching as there seemed to have been no fraud committed.
One program manager — Maria Aguilar (Aguilar) — likewise recommended coaching, after
having listened to the calls, but advised that De Leon would not be receiving her commission
pursuant to TRCI's Zero Tolerance Policy (ZTP) which authorizes the imposition of automatic
penalty. Ebus answered the email of Aguilar and clarified that De Leon did not have any intention
to defraud and that her infraction is not
covered by the ZTP .

On January 1, 2015, Ebus issued a Notice to Explain to De Leon, pursuant to Dombrowski's

instructions, but without mentioning any sanctions as Ebus was still awaiting the
recommendation of Aguilar who was his immediate supervisor. He gave Aguilar a copy of the
Notice to Explain and De Leon's explanation and informed Aguilar that he had yet to convey the
sanction to De Leon as he was not yet sure of the corrective measure to impose.
Later, Ebus was also handed a Notice to Explain with Preventive Suspension, stating
that he committed the following acts inimical to TRCI: (1) failure to act on an infraction by a
supervisor; (2) gross negligence in the performance of an assigned task; (3) willful disobedience
of the orders of a superior; and (4) serious misconduct. The same notice placed him under
preventive suspension for 30 days and summoned him to an administrative hearing.

Ebus submitted his explanation, stating that all the support staff concurred that coaching was the
sanction to be imposed on De Leon and that he was not grossly negligent as he fulfilled his duty
to issue the Notice to Explain to De Leon.
Administrative proceedings ensued on January 13, 2015. Subsequently, on February
9, 2015, TRCI issued a Notice of Decision, wherein Ebus was admonished with a warning that
another similar violation of TRCI's Code of Discipline might lead to his dismissal. He was found to
have committed insubordination for failing to issue a Notice to Explain to De Leon and to inform
her that it should be deemed a final warning for the infractions she committed.
The notice likewise informed Ebus that he would be re-profiled to another account. Hence, along
with the Notice of Decision, the HR Department issued a Redeployment Notice, placing Ebus on
temporary lay-off (TLO) until he was re-assigned to another account after being processed and
after having qualified therefor. During thelay-off, which should not exceed six months, Ebus
would not receive any compensation.

Ebus thus filed a Complaint for constructive dismissal and other monetary claims and damages
on March 20, 2015 before the Labor Arbiter (LA).

ISSUE
Whether Ebus was not constructively dismissed.

RULING
YES. To recall, TRCI, as a result of Ebus's transgressions, found it proper to penalize him with an
admonition with a warning and re-profiling. It is the latter that gave rise to the issuance of the
Redeployment Notice.Ebus argues that he was constructively dismissed when he was issued his
Redeployment Notice as it constituted a demotion, his employment status was placed in a vague
and indefinite status, and the transfer was invalid.
On the other hand, TRCI argues that it was a valid exercise of management prerogative when it
transferred, redeployed, and placed Ebus on TLO. TRCI argues that it was only validly regulating
the employment of Ebus and putting him on TLO was an opportunity for TRCI to assess Ebus's
qualifications and re-assign him to other accounts,if needed.

The Court agrees with Ebus. The CA erred in ruling that the NLRC did not commit grave abuse of
discretion when the NLRC's ruling contradicts settled jurisprudence on determining whether a
transfer results in constructive dismissal.

The Court discussed in Morales v. Harbour Centre Port Terminal, Inc. (Morales),that
in cases of transfer of an employee, the employer has the burden to prove that its conduct is
valid and legitimate and that it would not be prejudicial to the employee; otherwise, it will be
deemed as constructive dismissal.

Here, Ebus's infraction that led to his re-profiling was his failure to inform his subordinate of the
penalty imposable on her because of her error during a call. But there is nothing on record to
show that Ebus's infraction was detrimental to the account he was handling such that TRCI had
no choice but to re-profile him.In fact, Ebus was in reality not even transferred to any account.
Using TRCI's term, he was temporarily laid-off, and was treated like a new applicant where he
would be assessed for other accounts to see if he was qualified. In the interim, Ebus's economic
circumstances were murky. His salaries and benefits, save for accrued vacation leave, were all
stopped for a period not to exceed six months as he awaited being accepted into a new account.
Worse, he had no assurance whether he would be considered for another account.Measured
against the standard for a valid transfer as stated in Morales,the Court is convinced that TRCI
failed to prove any valid and legitimate ground to re-profile Ebus as its drastic action was not
commensurate to Ebus's transgressions. This action prejudiced Ebus as his salaries and benefits
were stopped and he was treated like a new applicant. TRCI just made it appear on paper that
Ebus was still its employee but in reality he received none of the benefits of one and was placed
in such a situation without any legitimate ground. This is clearly a dismissal in disguise and is
tantamount to constructive dismissal.

TRCI cannot hide behind the argument that its conduct was an exercise of management
prerogative as its actions prejudiced Ebus and it failed to provide a legitimate ground to put him
on TLO. Although the exercise of management prerogative will ordinarily not be interfered with,
it is not absolute and it is limited by law, collective bargaining agreement, and general principles
of fair play and justice. "Indeed, having the right should not be confused with the manner in
which that right is exercised."

225171, March 18, 2021, First Division (Caguioa, J.)

DOCTRINE
The Court in Gere v. Anglo-Eastern Crew Management Phils., Inc. was explicit in its ruling that
"the company-designated physician is mandated to issue a medical certificate, which should be
personally received by the seafarer, or, if not practicable, sent to him/her by any other means
sanctioned by present rules. For indeed, proper notice is one of the cornerstones of due process,
and the seafarer must be accorded the same especially so in cases where his/her well-being is at
stake."

FACTS
Petitioner United Philippine Lines, Inc. (UPL) hired Ramos on March 13, 2013 as Assistant Cook
for its foreign principal, petitioner Holland America Line Westours, Inc. His contract was for a
period of 10 months with a basic monthly salary of US$300.00.On March 27, 2013, Ramos
embarked on the vessel "MS ZUIDERDAM" but soon thereafter was medically repatriated and
arrived on April 10, 2013. This gave rise to Ramos's complaint for disability benefits. Ramos
claimed that while performing his tasks as Assistant Cook, he felt severe pain on his left shoulder,
prompting him to report this to his superior. He was advised to visit the infirmary where the ship
doctor gave him pain relievers and advised him to take a few days' rest. Ramos then requested
for off-shore consult but Holland America opted for his medical repatriation.Upon his arrival,
Ramos reported to UPL for his post disembarkation medical checkup and he was referred to
Shiphealth, Inc., where he was advised to undergo physical therapy sessions. Since his condition
did not improve, he was referred to the University Physicians Medical Center, Inc. He underwent
medical tests but he was not given the results of his medical examinations. He then went back to
Shiphealth, Inc. but he was told to get his medical records from UPL. He was told verbally that he
was fit to work but he was unable to get any record of his medical assessment from UPL.

Ramos then sought medical consult from Seamen's Hospital where it was recommended that he
underwent arthroscopic surgery. He also consulted with Dr. Cesar H. Garcia who specializes in
Orthopedic Surgery/Bone and Joint Diseases who opined that Ramos was unfit to work as a
seaman due to his shoulder injury.Ramos claimed that he is entitled to permanent and total
disability benefits because he has not returned to his seafaring job after, and even recalled that
he was already previously employed by petitioners and medically repatriated in May 2011 for an
injury on the same left shoulder. Although he was eventually cleared for duty, he rested for more
than a year and embarked on his second contract. However, he again experienced pain on his left
shoulder, which led to his medical repatriation.
For their part, petitioners claimed that Ramos was assessed by the companydesignated physician
with "Grade 10 — ankylosis of the shoulder joint not permitting arm to be raised above a level
with a shoulder and/or irreducible fracture or faulty union collar bone," and that Ramos is
therefore only entitled to US$12,090.00.
Labor Arbiter (LA) DecisionThe LA found that Ramos is entitled to total and permanent disability
benefits considering that it was the second time for Ramos to be medically repatriated for the
same physical infirmity. Since Ramos could not resume his work as a seaman, the LA ruled that a
Grade 10 disability rating was incorrect and believed the findings of Ramos's doctors. The LA also
found that Ramos was entitled to attorney's fees following Article 2208 of the Civil Code which
allows recovery of attorney's fees in actions for recovery of wages and actions for indemnity
under the employer's liability laws.

Petitioners thereafter filed an appeal before the NLRC.

NLRC DecisionThe NLRC affirmed the LA. Since Ramos was unduly deprived of the opportunity to
contest the assessment of the company-designated physician, the NLRC affirmed the LA's reliance
on the assessments of Ramos's doctors.Aggrieved, petitioners filed a petition for Certiorari before
the CA.

CA Decision
The CA affirmed the NLRC and denied the petition. The CA ruled that total and
permanent disability meant disablement of an employee to earn wages in the same kind of work,
or work of a similar nature that a seafarer is accustomed to perform, or any kind of work which a
person of his mentality and attainment could do. And since it appears that Ramos was still
suffering from his injuries well beyond the 120 or 240 days for the companydesignated physician
to arrive at a definite assessment, and in fact even after extensive treatment, he was still
suffering from his injuries, Ramos is entitled to total and permanent disability benefits.
Hence, this Petition for Review on Certiorari.

ISSUE
Whether Ramos is entitled to the award of permanent/total disability benefits.

RULING
YES. Ramos is deemed entitled to total and permanent disability benefits.The conflict resolution
procedure under Section 20 (A) (3) of the Philippine Overseas Employment Administration-
Standard Terms and Conditions Governing the Overseas Employment of Filipino Seafarers On-
board Ocean-going Ships (POEA-SEC) is clear that "in the event that a seafarer suffers a
[work-]related/aggravated illness or an injury during the course of his/her employment, it is the
company-designated physician's medical assessment that shall control the determination of the
seafarer's disability grading. Should the seafarer's
personal physician disagree, then the matter shall be referred to a neutral third-party
physician, who shall then issue a final and binding assessment."

Further, it is settled that should the seafarer fail to initiate the process to have the
conflicting assessments of the company-designated physician and his own doctor referred to a
third doctor, the assessment of the company-designated physician will prevail.But the seafarer's
failure to refer the conflicting findings of the company-designatedphysician and that of his own
doctor is only taken against him if it is first shown that the seafarer had been notified of the
assessment of the company-designated physician. It is only when the seafarer is duly and
properly informed of the medical assessment can he determine whether or not he agrees with
the assessment. If he does not agree, he can commence the process of referring the assessment
to his personal physician, and thereafter the conflicting assessments are referred to a third
doctor.

The Court in Gere v. Anglo-Eastern Crew Management Phils., Inc. was explicit in its ruling that
"the company-designated physician is mandated to issue a medical certificate, which should be
personally received by the seafarer, or, if not practicable, sent to him/her by any other means
sanctioned by present rules. For indeed, proper notice is one of the cornerstones of due process,
and the seafarer must be accorded the same
especially so in cases where his/her well-being is at stake."

Here, the NLRC found that Ramos was shown the assessment of his impediment only when and
after petitioners had filed their position paper, which petitioners did not deny. Petitioners'
argument that Ramos failed to prove that he requested for the assessment does not exempt
them from the requirement that the company-designated physician should have provided Ramos
with the assessment. It also does not negate the fact that Ramos only received the assessment of
the company-designated physician when petitioners filed their position paper. Petitioners cannot
pass the fault onto Ramos when it is clear that the company-designated physician is required to
provide the medical certificate to the seafarer personally or to ensure it is received through other
sanctioned means. Petitioners could have easily shown that Ramos received the assessment as
soon as the company-designated physician issued the same, but they failed to present any proof
of this.

Thus, given that Ramos only received a copy of the assessment from the companydesignated
physician when petitioners filed their position paper, his referral to his own doctor was actually a
superfluity. As the Court held in Gere, if the seafarer is not notified of the evaluation of the
company- designated physician after the lapse of the 120 or 240-day period for the company-
designated physician to issue the final and valid assessment of the seafarer's condition, then, by
operation of law, the seafarer is deemed entitled to total permanent disability benefits.

SATURNINO A. ELEVERA vs. ORIENT MARITIME SERVICES, INC.

G.R. No. 240054, March 18, 2021, First Division, Caguioa, J.
DOCTRINE
The seafarer shall be entitled to reimbursement of the cost of medicines prescribed by the
company-designated physician. In case treatment of the seafarer is on an out-patient basis as
determined by the company-designated physician, the company shall approve the appropriate
mode of transportation and accommodation. The reasonable cost of actual traveling expenses
and/or accommodation shall be paid subject to liquidation and submission of official receipts
and/or proof of expenses. For this purpose, the seafarer shall submit himself to a post-
employment medical examination by a company-designated physician within three working days
upon his return except when he is physically incapacitated to do so, in which case, a written
notice to the agency within the same period is deemed as compliance. In the course of the
treatment, the seafarer shall also report regularly to the company-designated physician
specifically on the dates as prescribed by the company-designated physician and agreed to by the
seafarer. Failure of the seafarer to comply with the mandatory reporting requirement shall
result in his forfeiture of the right to claim the benefits. If a doctor appointed by the seafarer
disagrees with the assessment, a third doctor may be agreed jointly between the Employer and
the seafarer. The third doctor's decision shall be final and binding on both parties.

FACTS
Elevera worked as a 3rd Engineer on board the vessel "Normand Baltic" for OSM Maritime, under
a three-month employment contract. He was deployed on January 30, 2013. However, sometime
in March 2013, Elevera complained of "ringing sensation on his left ear and dizziness
characterized as swirling of the surrounding." He was brought to Changi General Hospital due to
loss of hearing, where he was diagnosed with "Ear-Vertigo and other Vestibular Disorder-Stress
Related." Elevera was repatriated to the Philippines for medical treatment. The company-
designated physician diagnosed him with "Mild Sensorineural Hearing Loss, Right Ear; Moderate
Sensorineural Hearing Loss, Left Ear; Vestibular Neuronitis, Hypertensive Cardiovascular Disease,
and Blepharitis of Both Eyes."Another company-designated physician, Dr. Rosales, issued a
medical report
diagnosing Elevera with Vestibular Neuronitis and recommending a Grade 10 disability rating: His
suggested disability grading is Grade 10 — slight brain functional disturbance
that requires little attendance or aid and which interferes to a slight degree with the working
capacity of the patient. Dr. Rosales issued yet another medical report this time diagnosing Elevera
with Meniere's Disease and declaring him permanently unfit for sea duties. Elevera filed a
complaint for permanent total disability benefits.

LA: dismissed the complaint for lack of merit. Elevera failed to prove that his illness
is work-related or work aggravated. Although he alleged that his "work on board the vessel was
confined mainly in the engine room where he was exposed to continuous and deafening engine
noise," he still failed to establish that the nature of his work contributed to the development or
aggravation of his illness. The LA gave no credence to the Medical Evaluation of Dr. Vicaldo
because it was issued after only a single consultation and without any indication that appropriate
tests were conducted to arrive at such opinion.

NLRC: granted Elevera's appeal and awarded him permanent total disability benefits
in the amount of US$60,000.00. Contrary to the findings of the LA, the NLRC held that
Elevera's illness is work-related.

CA: partially granted Elevera's petition for certiorari by awarding attorney's fees equivalent to
10% of the total judgment award, but reduced the amount of partial disability benefits. On the
other hand, the CA denied respondents' petition for certiorari for lack of merit. The CA concurred
with the NLRC that Elevera's medical condition is work-related.

ISSUE
Whether his disability is total or partial.

RULING
Elevera is entitled to total and permanent disability benefits under the POEASEC. The work-
relatedness of Elevera's illness is beyond dispute, and so is his entitlement to disability benefits. It
must be stressed that in disability compensation, what is compensated is not the injury or illness,
but the incapacity to work resulting in the impairment of one's earning capacity. Moreover, the
determination of the fitness of a seafarer for work is the duty of the company-designated
physician, the seafarer's personal doctor, or the third doctor, as the case may be.

The seafarer shall be entitled to reimbursement of the cost of medicines prescribed by the
company-designated physician. In case treatment of the seafarer is on an out-patient
basis as determined by the company-designated physician, the company shall approve the
appropriate mode of transportation and accommodation. The reasonable cost of actual traveling
expenses and/or accommodation shall be paid subject to liquidation and
submission of official receipts and/or proof of expenses.For this purpose, the seafarer shall
submit himself to a post-employment medical examination by a company-designated physician
within three working days upon his return except when he is physically incapacitated to do so, in
which case, a written notice to the agency within the same period is deemed as compliance. In
the course of the treatment, the
seafarer shall also report regularly to the company-designated physician specifically on the dates
as prescribed by the company-designated physician and agreed to by the seafarer.

Failure of the seafarer to comply with the mandatory reporting requirement shall result in
his forfeiture of the right to claim the benefits. If a doctor appointed by the seafarer disagrees
with the assessment, a third doctor may be agreed jointly between the Employer and the
seafarer. The third doctor's decision shall be final and binding on both parties.
It is, therefore, beyond the labor tribunals' or the court's authority, nay expertise, to make its
own medical determination of a seafarer's fitness to work and/or prescribe a disability rating. The
POEA-SEC has provided a dispute mechanism wherein the seafarer's fitness to work and/or
disability rating may be determined by the company-designated physician, the seafarer's own
doctor, or the appointed third doctor, as the case may be.

Hence, the NLRC committed grave abuse of discretion when it gave a Grade 3 disability
rating for Elevera's medical condition even if none of the doctors had prescribed such a rating.
Further, the wording itself of the Medical Report dated August 30, 2013 is already
sufficient basis to award permanent and total disability benefits. It states that Elevera is
permanently unfit for sea duties.

Here, although the Medical Report of the company-designated physician states that Elevera is
"permanently unfit for sea duties," it failed to indicate the appropriate rating corresponding to
Elevera's disability. It cannot, therefore, be determined with certainty whether he is suffering
from total or mere partial permanent disability. This makes the Medical Report fatally defective
for being incomplete and indefinite. This accordingly results in a failure of the company-
designated physician to issue a final and definitive medical assessment within the 120-day period
set by law. Because of this, Elevera is deemed in law to be suffering from total and permanent
disabili
GREGORIO F. ABELLA vs. ABOSTA SHIPMANAGEMENT CORPORATION
G.R. No. 249358, April 28, 2021, First Division, Caguioa, J.
DOCTRINE
A final, conclusive, and definite medical assessment must clearly state whether the seafarer is fit
to work or the exact disability rating, or whether such illness is work-related, and without any
further condition or treatment. It should no longer require any further action on the part of the
company-designated physician and it is issued by the company-designated physician after he or
she has exhausted all possible treatment options within the periods allowed by law.

FACTS
Abella worked as an oiler for respondent Abosta Shipmanagement Corporation on board M/V
Sino Trader under a 10-month employment contract. Abella and his crewmates were ordered to
carry the ship's supplies and food provisions. While carrying a sack of rice, Abella allegedly felt a
sudden snap on his left lower back with a sharp pain radiating down to his thigh/leg. The incident
was immediately reported to his superiors, and Abella was given pain relievers and a waist
protector. Because his condition did not improve, he was brought to the Maritime Medical Centre
in Singapore where he was diagnosed with "Lumbar spondylosis with discopathy" and prescribed
medication. Due to persistent pain, he was again brought to a hospital in Brazil. Abella was
repatriated to the Philippines for further medical treatment.

When Abella arrived in the Philippines, he immediately reported to the companydesignated

physician at NGC Medical Specialist Clinic. After running a series of laboratory tests on Abella, the
company-designated physician diagnosed him with Herniated Nucleus Pulpos and recommended
that he undergo physical therapy. Abella claimed, however, that respondents ceased his
treatment and rehabilitation.During a conference respondents informed Abella that he is
suffering from Grade 8 disability and offered him the corresponding disability benefits in the
amount of US$16,795.00. Abella allegedly requested for further treatment or an improved
monetary offer, but his requests were denied. Abella consulted an orthopedic surgeon, Dr. Garcia,
who diagnosed him with Disc Protrusion & Radiculopathy and declared him permanently unfit for
sea duty in any capacity.
Abella instituted a complaint for payment of total and permanent disability benefits, medical
expenses, damages, and attorney's fees following respondents' alleged refusal to pay him total
and permanent disability benefits.

LA: dismissed Abella's complaint and ordered respondents to pay Abella disability
benefits corresponding to Grade 8 rating.
Page 15 of 174
NLRC: denied Abella's appeal. The NLRC acknowledged that the company-designated
physician arrived at a final medical assessment of Abella's condition or 108 days from his
repatriation. Thus, Abella's insistence that there was no such assessment and that he should be
deemed totally and permanently disabled cannot be sustained.
CA: denied Abella's petition for certiorari. The CA held that Abella failed to establish
his claim by substantial evidence. In the absence of a medical assessment from a third doctor, it is
more logical to give credence to the medical assessment issued by the companydesignated
physician. The CA explained that the company-designated physician had familiarity of Abella's
medical status considering that he attended to and monitored his condition from the time he was
repatriated. On the other hand, Dr. Garcia issued a medical assessment of Abella only after seeing
him once, and by merely relying on the existing medical examination results.

ISSUE
Whether Abella is entitled to total and permanent disability benefits under POEASEC.

RULING
The Petition is partly meritorious. Claims for disability benefits for injuries suffered by seafarers
on board or during the term of their employment contract are governed by the
provisions of the POEA-SEC, particularly Section 20 (A) thereof, which provides that: The
liabilities of the employer when the seafarer suffers work-related injury or illness during the term
of his contract are as follows:
1. The employer shall continue to pay the seafarer his wages during the time he is on
board the vessel.
2. If the injury or illness requires medical and/or dental treatment in a foreign port, the employer
shall be liable for the full cost of such medical, serious dental, surgical and hospital treatment as
well as board and lodging until the seafarer is declared fit to work or to be repatriated. However,
if after repatriation, the seafarer still requires medical attention arising from said injury or illness,
he shall be so provided at cost to the employer until such time he is declared fit or the degree of
his disability has been established by the company-designated physician.

3. Upon sign-off from the vessel for medical treatment, the seafarer is entitled to sickness
allowance equivalent to his basic wage until he is declared fit to work or the degree of permanent
disability has been assessed by the company-designated physician but in no case shall this period
exceed one hundred twenty (120) days.For this purpose, the seafarer shall submit himself to a
post-employment medical examination by a company-designated physician within three working
days upon his return except when he is physically incapacitated to do so, in which case, a written
notice to the agency within the same period is deemed as compliance. Failure of the seafarer to
comply with the mandatory reporting requirement shall result in his forfeiture of the right to
claimthe above benefits. If a doctor appointed by the seafarer disagrees with the assessment, a
third doctor may be agreed jointly between the Employer and the seafarer. The third doctor's
decision shall be final and binding on both parties.

Accordingly, the seafarer has the obligation to report to the company-designated physician within
three days from his repatriation, while the company-designated physician has the corresponding
obligation to issue a final assessment of the seafarer's disability within the periods mandated by
law.

It is, however, not enough for the company-designated physician to issue a medical assessment
within 120 or 240 days from the seafarer's repatriation. In order to be binding, the medical
assessment must be final, definite, and conclusive, otherwise, the law will step in and consider
the seafarer totally and permanently disabled.

A final, conclusive and definite medical assessment is described by the Court as follows: A final,
conclusive, and definite medical assessment must clearly state whether the seafarer is fit to work
or the exact disability rating, or whether such illness is work-related, and without any further
condition or treatment. It should no longer require any further action on the part of the
company-designated physician and it is issued by the companydesignated physician after he or
she has exhausted all possible treatment options within the periods allowed by law. Apart from
issuing a final, conclusive, and definite medical assessment, the companydesignated physician
and/or the company must also furnish the seafarer a copy thereof.

In this regard, the company-designated physician is mandated to issue a medical certificate,

which should be personally received by the seafarer, or, if not practicable, sent to him/her by any
other means sanctioned by present rules. For indeed, proper notice is one of the cornerstones of
due process, and the seafarer must be accorded the same especially so in cases where his/her
well-being is at stake. A company-designated physician who fails to "give" an assessment as
herein interpreted and defined fails to abide by due process, and consequently, fails to abide by
the foregoing guidelines.
As borne out by the records of the case, respondents and the company-designated
physician failed to furnish Abella with a copy of the November 22, 2016 Medical Assessment
within the periods mandated by law. Instead, respondents merely informed Abella of his Grade 8
disability rating during the conference. In fact, respondents admitted in their Comment that they
only furnished Abella a copy of the November 22, 2016 Medical Assessment through his counsel
during one of the mandatory conferences before the LA.

Hence, Abella cannot be expected to make an informed decision on whether he agrees with the
medical assessment of the company-designated physician or not on the basis of a mere verbal
declaration of his purported disability. Insofar as he is concerned, there is no final medical
assessment issued by the company-designated physician to contest. As such, he need not seek
the opinion of an independent physician, more so refer the matter to a third doctor. Without
proper notice of the November 22, 2016 Medical Assessment to Abella, he is already deemed
totally and permanently disabled by operation of law, and therefore entitled to the
corresponding disability benefits under the POEA-SEC. The medical assessment of Dr. Garcia as
well as the absence of a medical assessment from a third doctor become immaterial.

PACIFIC OCEAN MANNING, INC., BARKER HILL ENTERPRISES, S.A. AND ELMER
PULUMBARIT v. FELICIANO M. CASTILLO
G.R. No. 230527, June 14, 2021, First Division (Caguioa, J.)
DOCTRINE
As correctly held by the NLRC, Dr. Arandia's medical report must be viewed and upheld
in its entirety. Dr. Arandia's medical report does not indicate that Castillo was suffering from total
and permanent disability. If so, Dr. Arandia would have rated his disability as Grade 1. The phrase
"unfit to work as a seaman" should be understood in the context of Dr. Arandia having also given
a Grade 7 rating. Thus, the rational understanding of this phrase is that it merely indicates that
Castillo is suffering from a disability which renders him physically incapable for sea duties. The
report clearly did not declare that Castillo was suffering from total and permanent disability but
rather, that he was suffering only from Grade 7 partial permanent disability.

FACTS
Respondent Feliciano Castillo was hired as a fitter by petitioner Pacific Ocean Manning, Inc., for
its foreign principal, Barker Hill. His employment was covered by the Philippine Overseas,
Employment Administration Standard Employment Contract (POEASEC) and ITF IBF TCC AMOSUP
Collective Bargaining Agreement (CBA). Castillo boarded the
vessel MT Tequila on May 9, 2012. Castillo consulted the on-board doctor on October 25, 2012
due to pain in his right knee. The on-board doctor diagnosed Castillo with "Damage of the
Meniscus of the Right Knee." He was referred to a doctor in Poland, who made the same
diagnosis, and he was subsequently repatriated to the Philippines on October 28, 2012.Upon
arrival in Manila, Castillo reported to Pacific Ocean Manning's office and was
referred to company-designated physicians, namely: Dr. Fidel Chua (Dr. Chua), Dr. Tiong Sam Lim
(Dr. Lim), an orthopedic surgeon, and Dr. Antonio Periquet, a rehabilitation doctor. On October
30, 2012, Castillo consulted with Dr. Lim and was diagnosed with chondromalaciapatella, right or
patellofemoral syndrome. He was prescribed medications and advised to undergo physical
rehabilitation.

On March 27, 2013, Castillo consulted a personally-appointed physician, Dr. Manuel Magtira, who
issued a medical report which stated that Castillo was unfit for sea duties as he was suffering
from partial permanent disability with a disability rating of Grade 10. On April 11, 2013, Castillo
had a check-up with the company-designated physician Dr. Chua, who issued an interim disability
assessment also of Grade 10, and advised Castillo to continue physiotherapy. Castillo had another
check-up on May 8, 2013, after which, Castillo's condition was declared to be work-related with a
final disability rating of Grade 10. During the last consultation on August 2, 2013, Dr. Chua
advised that Castillo's physiotherapy be stopped and for Castillo to continue on a home exercise
program. On October 2, 2013, Castillo consulted a different personally-appointed physician, Dr.
Venancio Garduce, who gave a disability rating of Grade 6.
Castillo filed a complaint before the Labor Arbiter (LA) for total and permanent disability
compensation.

During the preliminary conference, the parties agreed to refer Castillo to a third and
independent physician, Dr. Edsel Arandia (Dr. Arandia), who diagnosed Castillo with valgus knee
2° to moderate-severe degenerative osteoarthritis and declared him unfit to work as a seafarer,
with a disability rating of Grade 7. Petitioners offered to pay US$20,900.00, equivalent to Grade 7
disability rating under the POEA-SEC but Castillo refused the offer. Thus, the parties were unable
to reach an amicable settlement and they submitted their respective Position Papers and Replies.

The LA rendered a Decision granting total and permanent disability compensation to Castillo
under the CBA in the total amount of US$93,154.00 and ten percent (10%) attorneys' fees. The LA
held that Castillo was suffering from total and permanent disability despite the partial disability
rating of Grade 7 because the third doctor had also declared him "unfit to work as a seaman."

On appeal, however, the NLRC reversed and set aside the LA Decision. The NLRC held
that Castillo was entitled only to Grade 7 disability compensation of US$ 20,900.00 under the
POEA-SEC. The NLRC ruled that the medical report of the third doctor is final and binding. Thus,
Dr. Arandia's diagnosis of Grade 7 partial permanent disability must be upheld in its entirety. The
NLRC also held that the higher rate under the CBA was not applicable because Castillo's condition
was not the result of an accident.Castillo filed a Petition for Certiorari to the CA maintaining that
he was entitled to the total and permanent disability compensation with the higher rate under
the CBA and not merely Grade 7 disability compensation under the POEA-SEC. The CA granted
Castillo's Petition for Certiorari, reversed and set aside the NLRC Resolutions, and reinstated the
LA Decision. The CA agreed with the LA that despite the Grade 7 disability rating given by Dr.
Arandia, Castillo's disability is total and permanent based on Dr. Arandia's medical report which
stated that Castillo is "unfit to work as a seaman." Petitioners filed a Motion for Reconsideration
of the CA Decision, but this was denied

ISSUE
Whether the CA correctly ruled that Castillo is entitled to the full amount of total and permanent
disability compensation under the CBA and attorney's fees.

RULING
NO. Castillo is entitle only to the amount of partial permanent disability compensation. The last
paragraph of Section 20(A)(3) of the POEA-SEC provides the mandatory conflict resolution
procedure when the findings of the company-designated physicians and the seafarer's appointed
physician are different:
If a doctor appointed by the seafarer disagrees with the assessment, a third doctor may be
agreed jointly between the Employer and the seafarer. The third doctor's decision shall be final
and binding on both parties.
In the instant case, the company-designated physician and seafarer's appointed physician were
consistent in their diagnoses that Castillo was suffering from partial permanent disability. They
differed only as to the disability rating. On the one hand, Dr. Chua, the company-designated
physician issued a disability rating of Grade 10. On the other hand, the seafarer-appointed
physician, Dr. Garduce, gave a disability rating of Grade 6. The Court notes however, that the first
seafarer-appointed physician consulted by Castillo, Dr. Magtira, also gave a disability rating of
Grade 10, consistent with the disability rating given by the company-designated physician. In any
event, the parties agreed to refer Castillo's condition to a third independent doctor in compliance
with the mandatory conflict resolution procedure under the POEA-SEC. The parties' jointly
chosen doctor, Dr. Arandia, issued a medical report. As certified by Dr. Arandia,

Castillo's condition is a Grade 7 disability which is a partial permanent disability under the POEA-
SEC. Only disabilities classified as Grade 1 are considered total permanent disability. Thus,
disabilities with a rating from Grade 2 to Grade 14 are classified as partial permanent disability.
The CA and LA focused only on the phrase "unfit to work as a seaman" and interpreted this as
total and permanent disability and completely disregarded the Grade 7 rating given by Dr.
Arandia.

The CA committed reversible error in its interpretation of Dr. Arandia's medical report. As
correctly held by the NLRC, Dr. Arandia's medical report must be viewed and upheld in its
entirety. Dr. Arandia's medical report does not indicate that Castillo was suffering from total and
permanent disability. If so, Dr. Arandia would have rated his disability as Grade 1. The phrase
"unfit to work as a seaman" should be understood in the context of Dr. Arandia having also given
a Grade 7 rating. Thus, the rational understanding of this phrase is that it merely indicates that
Castillo is suffering from a disability which renders him physically incapable for sea duties. The
report clearly did not declare that Castillo was suffering from total and permanent disability but
rather, that he was suffering only from Grade 7 partial permanent disability.

The CA also erred in holding that Castillo's condition is deemed total and permanent disability
because he had not been redeployed within 240 days. Section 20(A)(6) of the POEA-SEC expressly
states that the disability shall be based exclusively on the disability ratings under Section 32 and
shall not be measured or determined by the number of days a seafarer is under treatment or the
number of days in which sickness allowance is paid.
As clearly stated in Dr. Arandia's medical report, Castillo is suffering from a Grade 7 disability
which is a partial permanent disability. Under Section 20(A)(3) of thePOEA-SEC,
Dr. Arandia's medical report is final and binding. There can be no other basis for the
seafarer's medical condition as the third doctor's medical report is final and conclusive on the
parties. Thus, the Grade 7 disability rating must be respected and upheld by the Court.

JOHN N. CELESTE, EDGAR M. BUTED, DANILO V. GOMEZ, LUZVIMINDO CAGUIOA,

LELITO VALDEZ, RENATO P. MILLAN, CATALINA DE LEON, ROBERTO Q. ABULE
v. COMMISSION ON AUDIT
G.R. No. 237843, June 15, 2021, En Banc (Caguioa, J.)
DOCTRINE
When the CNAI subject of this case was granted to employees, the necessary rules
mandated by Item l7(b) of JR 4 had not yet been issued. NIA did not yet have any legal basis to
grant CNAI to its managerial employees.

FACTS
Petitioners John N. Celeste, Edgar M. Buted, Danilo V. Gomez, and Luzvimindo Caguioa are
employees of NIA Region I who were assigned to the NIA Office in Urdaneta City, Pangasinan at
the time of the controversy. During the periods of March to October 2010,
February 2011, and May 2011, NIA Region I paid Collective Negotiation Agreement Incentive
(CNAI) to its managerial and rank-and-file employees in the amounts of P460,000.00, P72,000.00,
and Pl92,000.00, respectively. On December 2, 2010, an Audit Observation Memorandum was
issued by the Audit Team Leader for NIA Region I concerning the grant and payment of CNAI.
Subsequently, three notices of disallowance (ND) were issued on the basis of a COA Decision.
Appeals were filed by petitioners to the COA Director. COA issued Decisions affirming the NDs.

Petitioners appealed the Decisions of the COA RO I to the COA Adjudication and Settlement
Board (ASB). In light of the abolition of the ASB per COA Resolution No. 2012-001, the COA-CP
decided the appeals, affirming the disallowances. In the Assailed Decision, the COA-CP agreed
with the COA RO I that CNAI may be granted only to rank-and-file employees. It further found
that NIA's reliance on Item 4(h)(ii)(aa) of Joint Resolution No. 4, s. 2009 of the Senate and House
of Representatives is misplaced. Before the Court, petitioners argue that JR 4 is in the nature of a
law, and that its Item 4(h)(ii)(aa) should be given effect to allow the grant of CNAI to managerial
employees. On
the other hand, respondent COA argues that JR 4, Item 4(h)(ii)(aa) is not an automatic grant of
CNAI to both rank-and-file and managerial employees, as it is dependent on the guidelines to be
issued jointly by the CSC and the DBM.

ISSUE
Whether COA committed grave abuse of discretion when it affirmed the disallowance
of CNAI paid to managerial employees of NIA.

RULING
NO. COA's disallowance of the CNAI granted to managerial employees of NIA is based
on AO 135 and BC 2006-1. Section 2 of AO 135 provides that the CNA incentive shall be
granted only to rank-and-file employees. Petitioners failed to consider that JR 4, Item 4(h)(ii)(aa)
is not an automatic grant of CNAI to managerial employees. JR 4 itself subjects
the grant of CNAI to the necessary rules and guidelines to be issued by the CSC and the DBM.
When the CNAI subject of this case was granted to employees of NIA during the periods of March
to October 2010, February 2011, and May 2011, the necessary rules mandated by Item l7(b) of JR
4 had not yet been issued. It was only on September 29, 2011 that the DBM issued Circular Letter
No. 2011-9, acknowledging that JR 4, Item 4(h)(ii)(aa) had extended the authority to grant CNAI
to managerial employees of government agencies.
Prior to that, the provisions of AO 135 and BC 2006-1 allowing the grant only to rank-andfile
employees were still in effect, and NIA did not yet have any legal basis to grant CNAI to its
managerial employees. Hence, the COA was correct in disallowing the same.Petitioners-payees of
the CNAI are liable to return the amounts they received. Being civil in nature, the liability of
officers and payees for unlawful expenditures provided in the Administrative Code of 1987 will
have to be consistent with civil law principles such as solutio indebiti and unjust enrichment.
These civil law principles support the propositions that (1) the good faith of payees is not
determinative of their liability to return; and (2) when the Court excuses payees on the basis of
good faith or lack of participation, it amounts to a remission of an obligation at the expense of
the government. In this case, the defect in the payment of CNAI to managerial employees of NIA
was not merely procedural; there was, at the time that these incentives were paid out, has no
legal basis.