FIRST DIVISION

[G.R. No. 79560 : December 3, 1990.]

191 SCRA 823
ANDRES E. DITAN, Petitioner, vs. PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION ADMINISTRATOR,
NATIONAL LABOR RELATIONS COMMISSION, ASIAWORLD RECRUITMENT, INC., AND/OR INTRACO SALES
CORPORATION, Respondents.

D E C I S I O N
CRUZ, J.:
The petitioner had the rare experience of being taken hostage in 1984, along with a number of his co-workers, by the
rebels in Angola. His captivity for more than two months and the events that followed his release are the subject of the
present petition.

Andres E. Ditan was recruited by private respondent Intraco Sales Corporation, through its local agent, Asia World, the
other private respondent, to work in Angola as a welding supervisor. The contract was for nine months, at a monthly
salary of US$1,100.00 or US$275.00 weekly, and contained the required standard stipulations for the protection of our
overseas workers.
Arriving on November 30, 1984, in Luanda, capital of Angola, the petitioner was assigned as an ordinary welder in the
INTRACO central maintenance shop from December 2 to 25, 1984. On December 26, 1984, he was informed, to his
distress, that would be transferred to Kafunfo, some 350 kilometers east of Luanda. This was the place where, earlier
that year, the rebels had attacked and kidnapped expatriate workers, killing two Filipinos in the raid. Naturally, Ditan
was reluctant to go. However, he was assured by the INTRACO manager that Kafunfo was safe and adequately protected
by government troops; moreover and this was more persuasive he was told he would be sent home if he refused
the new assignment. In the end, with much misgiving, he relented and agreed.: nad
On December 29, 1984, his fears were confirmed. The Unita rebels attacked the diamond mining site where Ditan was
working and took him and sixteen other Filipino hostages, along with other foreign workers. The rebels and their
captives walked through jungle terrain for 31 days to the Unita stronghold near the Namibian border. They trekked for
almost a thousand kilometers. They subsisted on meager fare. Some of them had diarrhea. Their feet were blistered. It
was only on March 16, 1985, that the hostages were finally released after the intercession of their governments and the
International Red Cross. Six days later, Ditan and the other Filipino hostages were back in the Philippines. 1
The repatriated workers had been assured by INTRACO that they would be given priority in re-employment abroad, and
eventually eleven of them were taken back. Ditan having been excluded, he filed in June 1985 a complaint against the
private respondents for breach of contract and various other claims. Specifically, he sought the amount of US$4,675.00,
representing his salaries for the unexpired 17 weeks of his contract; US$25,000.00 as war risk bonus; US$2,196.50 as the
value of his lost belongings; US$1,100 for unpaid vacation leave; and moral and exemplary damages in the sum of
US$50,000.00, plus attorney's fees.
All these claims were dismissed by POEA Administrator Tomas D. Achacoso in a decision dated January 27, 1987. 2 This
was affirmed in toto by respondent NLRC in a resolution dated July 14, 1987, 3 which is now being challenged in this
petition.
Going over the record, we find that the public respondent correctly rejected the petitioner's claim for paid vacation
leave. The express stipulation in Clause 5 of the employment contract reads:
Should the Employee enter into a further 9 to 12 months contract at the completion contract, he will be entitled to one
month's paid vacation before commencement of his second or subsequent contract.
It appears that the petitioner had not entered into a second contract with the employer after the expiration of the first.
Such re-employment was not a matter of right on the part of the petitioner but dependent on the need for his skills in
another project the employer might later be undertaking.
As regards the cost of his belongings, the evidence shows that they were not really lost but in fact returned to him by
the rebels prior to their release. If he had other properties that were not recovered, there was no proof of their loss that
could support his allegations. They were therefore also properly rejected.:-cralaw
We find, though, that the claims for breach of contract and war risk bonus deserve a little more reflection in view of the
peculiar circumstances of this case.
The fact that stands out most prominently in the record is the risk to which the petitioner was subjected when he was
assigned, after his reluctant consent, to the rebel-infested region of Kafunfo. This was a dangerous area. This same place
had earlier been the target of a rebel attack that had resulted in the death of two Filipino workers and the capture of
several others. Knowing all this, INTRACO still pressured Ditan into agreeing to be transferred to that place, dismissing
his initial objection and, more important, threatening to send him home if he refused.
We feel that in failing to provide for the safety of the petitioner, the private respondents were clearly remiss in the
discharge of one of the primary duties of the employer. Worse, they not only neglected that duty but indeed
deliberately violated it by actually subjecting and exposing Ditan to a real and demonstrated danger. It does not help to
argue that he was not forced to go to Kafunfo and had the option of coming home. That was a cruel choice, to say the
least. The petitioner had gone to that foreign land in search of a better life that he could share with his loved ones after
his stint abroad. That choice would have required him to come home empty-handed to the disappointment of an
expectant family.
It is not explained why the petitioner was not paid for the unexpired portion of his contract which had 17 more weeks to
go. The hostages were immediately repatriated after their release, presumably so they could recover from their ordeal.
The promise of INTRACO was that they would be given priority in re-employment should their services be needed. In the
particular case of the petitioner, the promise was not fulfilled. It would seem that his work was terminated, and not
again required, because it was really intended all along to assign him only to Kafunfo.:-cralaw
The private respondents stress that the contract Ditan entered into called for his employment in Angola, without
indication of any particular place of assignment in the country. This meant he agreed to be assigned to work anywhere
in that country, including Kafunfo. When INTRACO assigned Ditan to that place in the regular course of its business, it
was merely exercising its rights under the employment contract that Ditan had freely entered into. Hence, it is argued,
he cannot now complain that there was a breach of that contract for which he is entitled to monetary redress.
The private respondents also reject the claim for war risk bonus and point out that POEA Memorandum Circular No. 4,
issued pursuant to the mandatory war risk coverage provision in Section 2, Rule VI, of the POEA Rules and Regulations
on Overseas Employment, categorizing Angola as a war risk took effect only on February 6, 1985, "after the petitioner's
deployment to Angola on November 27, 1984." Consequently, the stipulation could not be applied to the petitioner as it
was not supposed to have a retroactive effect.
A strict interpretation of the cold facts before us might support the position taken by the respondents. However, we are
dealing here not with an ordinary transaction but with a labor contract which deserves special treatment and a liberal
interpretation in favor of the worker. As the Solicitor General observes in his Comment supporting the petitioner, the
Constitution mandates the protection of labor and the sympathetic concern of the State for the working class
conformably to the social justice policy. This is a command we cannot disregard in the resolution of the case before us.
The paramount duty of this Court is to render justice through law. The law in this case allows two opposite
interpretations, one strictly in favor of the employers and the other liberally in favor of the worker. The choice is obvious.
We find, considering the totality of the circumstances attending this case, that the petitioner is entitled to relief.
The petitioner went to Angola prepared to work as he had promised in accordance with the employment contract he
had entered into in good faith with the private respondents. Over his objection, he was sent to a dangerous assignment
and as he feared was taken hostage in a rebel attack that prevented him from fulfilling his contract while in captivity.
Upon his release, he was immediately sent home and was not paid the salary corresponding to the unexpired portion of
his contract. He was immediately repatriated with the promise that he would be given priority in re-employment, which
never came. To rub salt on the wound, many of his co-hostages were re-employed as promised. The petitioner was left
only with a bleak experience and nothing to show for it except dashed hopes and a sense of rejection.
In these circumstances, the Court feels that the petitioner should be paid the salary corresponding to the 17 unserved
weeks of his contract, which was terminated by the private respondents despite his willingness to work out the balance
of his term. In addition, to assuage the ordeal he underwent while in captivity by the rebels, the Court has also decided
in its discretion to award him nominal damages in the sum of P20,000.00. This is not payment of the war risk claim
which, as earlier noted, was not provided for in the employment contract in question, or indemnification for any loss
suffered by him. This is but a token of the tenderness of the law towards the petitioning workman vis-a-vis the private
respondents and their more comfortable resources.: nad
Under the policy of social justice, the law bends over backward to accommodate the interests of the working class on
the humane justification that those with less privileges in life should have more privileges in law. That is why our
judgment today must be for the petitioner.
WHEREFORE, the challenged resolution of the NLRC is hereby MODIFIED. The private respondents are hereby DIRECTED
jointly and severally to pay the petitioner: a) the current equivalent in Philippine pesos of US$4,675.00, representing his
unpaid salaries for the balance of the contract term; b) nominal damages in the amount of P20,000.00; and c) 10%
attorney's fees. No costs.
SO ORDERED.
Narvasa, Gancayco, Grio-Aquino and Medialdea, JJ., concur.

Endnotes
1. Rollo, p. 47.
2. Ibid., pp. 46-54.
3. Id., pp. 65-69.


Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION

G.R. No. 97945 October 8, 1998
PRIME MARINE SERVICES, INC., petitioner,
vs.
NATIONAL LABOR RELATIONS COMMISSION, PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION, R & R
MANAGEMENT SERVICES INTERNATIONAL, and NAPOLEON CANUT, respondents.

MENDOZA, J.:
This is a petition for certiorari to set aside the decision, dated February 21, 1991, of the National Labor Relations
Commission, dismissing the appeal of petitioner Prime Marine Services, Inc. from the decision of the Philippine Overseas
Employment Administration in POEA Case No. (L) 88-10-850, as well as the resolution, dated March 26, 1991, of the
NLRC, denying reconsideration.
Private respondent Napoleon Canut was recruited to work as a Tug Master for Arabian Gulf Mechanical Services and
Contracting Co., Ltd. (Arabian Gulf) by R & R Management Services International (R & R Management) for a period of 18
months, commencing June 15, 1988. Private respondent's employment was, however, preterminated allegedly on the
ground that he was incompetent. He was repatriated to the Philippines on September 26, 1988.
1

When private respondent reviewed his employment papers, he discovered that while R & R Management had acted as
recruitment agency in processing his application, it was actually petitioner Prime Marine Services, Inc., as deployment
agent, which had processed his papers and facilitated his going abroad. Further investigation showed that R & R
Management was not licensed to recruit workers for overseas employment. Accordingly, private respondent filed a
complaint before the Philippine Overseas Employment Agency for illegal dismissal, underpayment of salaries, and
recruitment violations against petitioner, R & R Management, and Arabian Gulf.
2

Petitioner denied that there was any employer-employee relationship between it and private respondent. It pointed out
that private respondent admitted he had applied with and paid his placement fee to R & R Management. Petitioner
likewise denied that it had any part in the processing of private respondent's papers and argued that only Arabian Gulf
and R & R Management should be held liable to private respondent. For this reason, petitioner filed a cross-claim against
R & R Management seeking reimbursement for any amount which petitioner may be held liable for to private
respondent.
3

R & R Management, on the other hand, averred that it referred private respondent to petitioner in order for the latter to
facilitate private respondent's employment abroad and consequently worked in conjunction with petitioner in
processing private respondent's deployment.
4

On October 13, 1989, Deputy Administrator Cresencio M. Siddayao of the POEA rendered a decision disposing of the
case as follows:
WHEREFORE, in view of the foregoing, Prime Marine Services, Inc., R & R Management Services, Int'l and
Arabian Gulf Mechanical Services and Contracting Co. Ltd., are hereby ordered, jointly and severally, to
pay complainant the following in Philippines Currency at the prevailing rate of exchange at the time of
payment:
SR 33,750.00 representing salaries
for the unexpired portion of the
contract for 15 months at SR 2,250.00 a
month;
350.00 representing salary differential;
5% percent Attorney's fees of the award.
Furthermore, R & R Management Services International is referred to the Anti-illegal Recruitment
Branch of this Office for appropriate action.
Finally, the cross claim of Prime Marine Services, Inc. against R & R Management Services International
is dismissed for lack of merit.
SO ORDERED.
Petitioner filed a motion for reconsideration with the National Labor Relations Commission which the latter created as
an appeal. In its decision, dated February 21, 1991, the NLRC affirmed in toto the POEA's decision. On March 26, 1991, it
denied petitioner's motion for reconsideration. Hence, this petition containing the following assignment of errors:
I. Public respondent NLRC and/or POEA committed grave abuse of discretion when they
ignored existing jurisprudence.
II. Dismissal of the cross-claim (against private respondent R & R Management)
constitutes also grave abuse of discretion.
As to its first assignment of error, petitioner contends that the ruling of the NLRC goes against this Court's decision in Ilas
v. NLRC.
5

The contention has no merit. The case of Ilas simply held that a recruitment agency cannot be found liable for unpaid
wages and other claims of overseas workers who have been recruited by its agent without its knowledge and consent.
The Court's ruling denying liability against the recruitment agency (All Seasons Manpower International Services) was
based on the following factual findings of the POEA and the NLRC, which the Court affirmed:
All evidence indicate that private respondent [All Seasons Manpower International Services] cannot be
held liable for the claims of petitioners.
Firstly, petitioners applied for overseas deployment with CBT/Shiek International through spouses
Francisco and Corazon Ngoho, Eddie Sumaway and Erlinda Espeno. They never transacted their business
with the office of private respondent.
Secondly, when they worked at Doha, Qatar, their employer as CBT/Shiek International who failed to
pay their wages.
Thirdly, in the TEPS provided by Espeno to enable them to travel, it was made to appear that private
respondent was their agency/contractor of petitioners and Yacoub Trading Est. is their foreign employer.
They were signed by petitioners knowing that private respondent was not their recruiter. Apparently,
Espeno conspired with petitioners and Ngoho to enable petitioners to travel to the Middle East,
ostensibly under the name of private respondent as agent/recruiter.
Fourthly, it turned our that petitioners were recruited for Mabeco Trading and Contracting
Establishment, as the foreign principal and not Yacoub Trading Est., which is the principal of private
respondent.
Fifthly, in the very compliant filed by petitioners against private respondent they admitted that they
applied for overseas employment with the CBT/Shiek International under the management of the
Ngohos.
6

In contrast, both the POEA and the NLRC found that petitioner and R & R Management acted jointly in recruiting and
deploying private respondent abroad, to wit:
This contention cannot be sustained. The records show that while complainant applied with respondent
R & R, he was however deployed by herein movant Prime Marine and this was not rebutted during the
proceedings below. Consequently, We find no sufficient reason to disturb the questioned decision. We,
therefore, quote with approval and adopt as Our own the following findings of the POEA Deputy
Administrator.
We find respondent R & R and prime Marine jointly and severally liable with
complainant's foreign employer, Arabian Gulf Mechanical Services and Contracting Co.
Ltd. R & R is the recruiting agency while Prime Marine is the deploying
agency. Complainant alleged that he applied with R & R and the latter admitted that
it "has facilitated and contributed efforts in conjunction with Prime Marine in sending
the applicant complainant abroad under a contract." Prime Marine did not rebut this
allegation. It did not even explain or touch on the matter why it appeared as the
deploying agent in the Crew Agreement exhibited by complainant. The foregoing leads
us to the inevitable conclusion that there is a collusion between R & R and Prime Marine
with respect to complainant's application and deployment. Thus, its cross claim against
R & R must necessarily fail because it is held jointly and severally liable with R & R and
the foreign employer.
7

Although petitioner denied before the POEA and the NLRC any part in the processing of private respondent's papers, it
now admits that its general manager after all took part in the deployment of private respondent. However, it claims that
its general manager was not authorized to do so and that she was in collusion with private respondent.
8

It is sufficient in order to dispose of this new contention to say that factual findings of administrative agencies are
generally held to be binding and even final so long as they are supported by substantial evidence in the record of the
case.
9
This is especially so where, as here, the agency and a subordinate one which heard the case in the first instance
are in full agreement as to the facts.
10
This rule was, in fact, reiterated in the Ilas case which petitioner invokes:
No rule is more settled than that this Court is not a trier of facts and that the findings of facts of
administrative bodies, as public respondent, shall not disturbed on appeal unless it is shown that it
committed a grave abuse of discretion or otherwise acted without jurisdiction or in excess of its
jurisdiction. In this case, petitioners failed to discharge their burden to warrant a departure from this
rule.
11

It should be pointed out that petitioner belatedly claims that its general manager acted without authority and in
collusion with private respondent apparently to bring this case within the ambit of Ilas which held that a recruitment
agency is not liable for the unauthorized acts of its agents. This transparent effort to make the present case fit the ruling
in Ilas is done with out specifying the alleged evidence supporting such claim of collusion. Neither does petitioner even
attempt to controvert the express finding of both the POEA and the NLRC that it failed to rebut R & R Management's
allegation that both of these firms jointly processed private respondent's employment.
As to petitioner's second assignment of error, such should be dismissed as its solidary liability with R & R Management
and Arabian Gulf for private respondent's claims is founded on the fact that both petitioner and R & R Management, and
not the latter alone, processed private respondent's recruitment and deployment abroad.
There is no question that a private manning agency, such as petitioner, can be held liable for private respondent's claims.
The Rules and Regulations of the POEA expressly provide that every applicant seeking a license or authority to operate a
private employment, recruitment, or manning agency must submit, among others:
d. A verified undertaking stating that the applicant:
xxx xxx xxx
(3) shall assume joint and solidary liability with the employer for all claims and liabilities which may arise
in connection with the implementation of the contract of employment;
12

WHEREFORE, the petition is DISMISSED.
SO ORDERED.
Regalado, Melo, Puno and Martinez, JJ., concur.
Footnotes
1 Rollo, p. 13.
2 Ibid.
3 Rollo, p. 14.
4 Ibid.
5 193 SCRA 682 (1991).
6 Id., p. 685.
7 Rollo, pp. 15 & 21 (emphasis added).
8 Id., p. 6.
9 International Container Terminal Services, Inc. v. NLRC, 256 SCRA 124 (1996).
10 Belaunzaran v. NLRC. 265 SCRA 800 (1996).
11 193 SCRA 682, 684-685 (1991).
12 Philippine Overseas Employment Administration Rules and Regulations, Bk. II, Rule II, 1 d(3) (1985);
now Bk. II, Rule II, 1 f(3) of the Rules and Regulations Governing Overseas Employment as Amended
(1991).


Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION

G.R. Nos. 90394-97 February 7, 1991
HERMINIGILDO ILAS, GLICERIO BELARMINO, MARIO BARBOSA and TEODORO ENRIQUEZ, petitioners,
vs.
THE NATIONAL LABOR RELATIONS COMMISSION and ALL SEASONS MANPOWER INTERNATIONAL
SERVICES, respondents.
Cielo B. Pre for petitioners.
Horacio R. Viola, Sr. for private respondent.

GANCAYCO, J.:p
Can a recruitment agency be liable for unpaid wages and other claims of certain overseas workers who appear to have
been recruited by its agent without its knowledge and consent? This is the focal issue in this petition.
Petitioners applied for overseas employment in Doha, Qatar, with CBT/Shiek International, an unlicensed recruitment
agency, under the management of spouses Francisco Ngoho, Jr. and Corazon Ngoho. To enable them to leave, they were
assisted by Eddie Sumaway and Erlinda Espeno, the latter being a liaison officer of private respondent All Seasons
Manpower International Services, a licensed placement agency. Petitioners filed their application papers and paid their
placement fees with the Ngohos. However, it was Espeno who processed their papers and gave them travel exit passes
(TEPS). They were made to sign two-year contracts of employment but they were not given copies thereof.
Subsequently, they were deployed to Doha, Qatar, where they worked for four (4) months without being paid. They
sought the assistance of the Philippine Embassy and were able to come home to the Philippines with the help of the
Philippine Overseas Employment Administration (POEA).
Hence, they filed a complaint to recover their unpaid salaries and for wages covering the unexpired portion of their
contracts against private respondent.
On June 30, 1989, the POEA rendered a decision, the dispositive part of which reads as follows:
WHEREFORE, judgment is hereby rendered, ordering the respondent to refund to complainants
Bonifacio Gagascas, Herminigildo Ilas, Diosdado Galang, Antonio Frias, Perfecto Lora, Jr., Rolando
Ernacio, Emmanuel Padilla, Andres Lontabo, Juanito Cueto, Camilo Pastrana, Mario Barbosa, Romeo
Muldong, Arnold Cresidio, Dominguez de la Cruz, Samuel Leao, Teodoro Enriquez and Jaime Ramos,
the amount of TWO THOUSAND FIVE HUNDRED PESOS (P2,500.00) each, representing placement fees.
The claims for the salaries corresponding to the unexpired portion of the complainant's contracts are
hereby ordered DISMISSED for lack of merit.
The claims of Pedro Pabillonia, Glicerio Belarmino, Jaime Ramos, Rodolfo de Jesus, Romeo Toledo, Pedro
Sagayap, Macario Valdez, Benjamin Julio, Ernesto Yadao, Severino Pilon are hereby ordered severed
from the other complaints in view of settlement.
SO ORDERED.
1

Both parties appealed to public respondent National Labor Relations Commission (NLRC) which in due course rendered a
decision on September 23, 1988 modifying the appealed decision to the effect that petitioners were adjudged entitled
to their four (4) months unpaid salaries to be paid by private respondent but the refund of placement fees was deleted.
A motion for reconsideration thereof was filed by private respondent. On April 28, 1989, a decision was rendered by
public respondent setting aside the decision dated September 23, 1988 and dismissing the case for lack of merit.
2
A
motion for reconsideration filed by petitioners was denied in a resolution dated June 7, 1989.
3

Hence, the herein petition for certiorari wherein it is alleged that public respondent committed a grave abuse of
discretion in setting aside its decision dated September 23, 1988 and rendering the questioned decision dated April 28,
1989.
The petition must fail.
No rule is more settled than that this Court is not a trier of facts and that the findings of facts of administrative bodies,
as public respondent, shall not be disturbed on appeal unless it is shown that it committed a grave abuse of discretion or
otherwise acted without jurisdiction or in excess of its jurisdiction. In this case, petitioners failed to discharge their
burden to warrant a departure from this rule.
All evidence indicate that private respondent cannot be held liable for the claims of petitioners.
Firstly, petitioners applied for overseas deployment with CBT/Shiek International through spouses Francisco and
Corazon Ngoho, Eddie Sumaway and Erlinda Espeno. They never transacted their business with the office of private
respondent.
Secondly, when they worked at Doha, Qatar, their employer was CBT/Shiek International who failed to pay their wages.
Thirdly, in the TEPS provided by Espeno to enable them to travel, it was made to appear that private respondent was
their agency/contractor of petitioners and Yacoub Trading Est. is their foreign employer. They were signed by petitioners
knowing that private respondent was not their recruiter. Apparently, Espeno conspired with petitioners and Ngoho to
enable petitioners to travel to the Middle East, ostensively under the name of private respondent as agent/recruiter.
Fourthly, it turned out that petitioners were recruited for Mabeco Trading and Contracting Establishment, as the foreign
principal and not Yacoub Trading Est., which is the principal of private respondent.
Fifthly, in the very complaints filed by petitioners against private respondent they admitted that they applied for
overseas employment with the CBT/Shiek International under the management of the Ngohos.
4

It is true that the rules and regulations of the POEA provide that the private employment or recruitment agency is made
to assume full and complete responsibility for all acts of its officials and representatives done in connection with
recruitment and placement.
5
However, when as in this case the recruitment was actually made by Espeno in behalf of
CBT/Shiek International, not the private respondent, and the name of private respondent was only used as a means to
enable petitioners to be issued TEPS for travel purposes, obviously without the knowledge and consent of private
respondent, the latter cannot be held liable for the claims of petitioners.
The observation of public respondent that the documents used in the deployment abroad of petitioners were all fake
and that petitioners knew about it is borne by the records. They did not come to court with clean hands. Thus,
petitioners should suffer the consequences of their wrongful acts.
WHEREFORE, the petition is DISMISSED for lack of merit.
SO ORDERED.
Narvasa, Cruz, Grio-Aquino and Medialdea, JJ., concur.

Footnotes
1 Page 36, Rollo.
2 Pages 19 to 29, Rollo; Annex A to Petition.
3 Pages 30 to 31, Rollo: Annex A-1 to Petition.
4 Pages 84 to 85, Original Records.
5 Book II, Rule II, Section 1, Rules and Regulations of the POEA.


Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION

G.R. No. 120095 August 5, 1996
JMM PROMOTION AND MANAGEMENT, INC., and KARY INTERNATIONAL, INC., petitioner,
vs.
HON. COURT OF APPEALS, HON. MA. NIEVES CONFESSOR, then Secretary of the Department of Labor and
Employment, HON. JOSE BRILLANTES, in his capacity as acting Secretary of the Department of Labor and Employment
and HON. FELICISIMO JOSON, in his capacity as Administrator of the Philippine Overseas Employment
Administration, respondents.

KAPUNAN, J.:p
The limits of government regulation under the State's police power are once again at the vortex of the instant
controversy. Assailed is the government's power to control deployment of female entertainers to Japan by
requiring an Artist Record Book (ARB) as a precondition to the processing by the POEA of any contract for
overseas employment. By contending that the right to overseas employment is a property right within the
meaning of the Constitution, petitioners vigorously aver that deprivation thereof allegedly through the onerous
requirement of an ARB violates the due process clause and constitutes an invalid exercise of the police power.
The factual antecedents are undisputed.
Following the much-publicized death of Maricris Sioson in 1991, former President Corazon C. Aquino ordered a
total ban against the deployment of performing artists to Japan and other foreign destinations. The ban was,
however, rescinded after leaders of the overseas employment industry promised to extend full support for a
program aimed at removing kinks in the system of deployment. In its place, the government, through the
Secretary of Labor and Employment, subsequently issued Department Order No. 28, creating the Entertainment
Industry Advisory Council (EIAC), which was tasked with issuing guidelines on the training, testing certification
and deployment of performing artists abroad.
Pursuant to the EIAC's recommendations,
1
the Secretary of Labor, on January 6, 1994, issued Department Order
No. 3 establishing various procedures and requirements for screening performing artists under a new system of
training, testing, certification and deployment of the former. Performing artists successfully hurdling the test,
training and certification requirement were to be issued an Artist's Record Book (ARB), a necessary prerequisite
to processing of any contract of employment by the POEA. Upon request of the industry, implementation of the
process, originally scheduled for April 1, 1994, was moved to October 1, 1994.
Thereafter, the Department of Labor, following the EIAC's recommendation, issued a series of orders fine-tuning
and implementing the new system. Prominent among these orders were the following issuances:
1. Department Order No. 3-A, providing for additional guidelines on the training, testing, certification
and deployment of performing artists.
2. Department Order No. 3-B, pertaining to the Artist Record Book (ARB) requirement, which could be
processed only after the artist could show proof of academic and skills training and has passed the
required tests.
3. Department Order No. 3-E, providing the minimum salary a performing artist ought to received (not
less than US$600.00 for those bound for Japan) and the authorized deductions therefrom.
4. Department Order No. 3-F, providing for the guidelines on the issuance and use of the ARB by
returning performing artists who, unlike new artists, shall only undergo a Special Orientation Program
(shorter than the basic program) although they must pass the academic test.
In Civil Case No. 95-72750, the Federation of Entertainment Talent Managers of the Philippines (FETMOP), on
January 27, 1995 filed a class suit assailing these department orders, principally contending that said orders 1)
violated the constitutional right to travel; 2) abridged existing contracts for employment; and 3) deprived
individual artists of their licenses without due process of law. FETMOP, likewise, averred that the issuance of the
Artist Record Book (ARB) was discriminatory and illegal and "in gross violation of the constitutional right... to life
liberty and property." Said Federation consequently prayed for the issuance of a writ of preliminary injunction
against the aforestated orders.
On February 2, 1992, JMM Promotion and Management, Inc. Kary International, Inc., herein petitioners, filed a
Motion for Intervention in said civil case, which was granted by the trial court in an Order dated 15 February,
1995.
However, on February 21, 1995, the trial court issued an Order denying petitioners' prayed for a writ of
preliminary injunction and dismissed the complaint.
On appeal from the trial court's Order, respondent court, in CA G.R. SP No. 36713 dismissed the same. Tracing
the circumstances which led to the issuance of the ARB requirement and the assailed Department Order,
respondent court concluded that the issuance constituted a valid exercise by the state of the police power.
We agree.
The latin maxim salus populi est surprema lex embodies the character of the entire spectrum of public laws
aimed at promoting the general welfare of the people under the State's police power. As an inherent attribute
of sovereignty which virtually "extends to all public needs,"
2
this "least limitable"
3
of governmental powers
grants a wide panoply of instruments through which the state, as parens patriae gives effect to a host of its
regulatory powers.
Describing the nature and scope of the police power, Justice Malcolm, in the early case of Rubi v. Provincial
Board of Mindoro
4
wrote:
"The police power of the State," one court has said... is a power coextensive with self-protection, and is
not inaptly termed "the law of overruling necessity." It may be said to be that inherent and plenary
power in the state which enables it to prohibit all things hurtful to the comfort, safety and welfare of
society." Carried onward by the current of legislature, the judiciary rarely attempts to dam the
onrushing power of legislative discretion, provided the purposes of the law do not go beyond the great
principles that mean security for the public welfare or do not arbitrarily interfere with the right of the
individual.
5

Thus, police power concerns government enactments which precisely interfere with personal liberty or property
in order to promote the general welfare or the common good. As the assailed Department Order enjoys a
presumed validity, it follows that the burden rests upon petitioners to demonstrate that the said order,
particularly, its ARB requirement, does not enhance the public welfare or was exercised arbitrarily or
unreasonably.
A thorough review of the facts and circumstances leading to the issuance of the assailed orders compels us to
rule that the Artist Record Book requirement and the questioned Department Order related to its issuance were
issued by the Secretary of Labor pursuant to a valid exercise of the police power.
In 1984, the Philippines emerged as the largest labor sending country in Asia dwarfing the labor export of
countries with mammoth populations such as India and China. According to the National Statistics Office,
thisdiaspora was augmented annually by over 450,000 documented and clandestine or illegal (undocumented)
workers who left the country for various destinations abroad, lured by higher salaries, better work opportunities
and sometimes better living conditions.
Of the hundreds of thousands of workers who left the country for greener pastures in the last few years, women
composed slightly close to half of those deployed, constituting 47% between 1987-1991, exceeding this
proportion (58%) by the end of 1991,
6
the year former President Aquino instituted the ban on deployment of
performing artists to Japan and other countries as a result of the gruesome death of Filipino entertainer Maricris
Sioson.
It was during the same period that this Court took judicial notice not only of the trend, but also of the fact that
most of our women, a large number employed as domestic helpers and entertainers, worked under exploitative
conditions "marked by physical and personal abuse."
7
Even then, we noted that "[t]he sordid tales of
maltreatment suffered by migrant Filipina workers, even rape and various forms of torture, confirmed by
testimonies of returning workers" compelled "urgent government action."
8

Pursuant to the alarming number of reports that a significant number of Filipina performing artists ended up as
prostitutes abroad (many of whom were beaten, drugged and forced into prostitution), and following the deaths
of number of these women, the government began instituting measures aimed at deploying only those
individuals who met set standards which would qualify them as legitimate performing artists. In spite of these
measures, however, a number of our countrymen have nonetheless fallen victim to unscrupulous recruiters,
ending up as virtual slaves controlled by foreign crime syndicates and forced into jobs other than those indicated
in their employment contracts. Worse, some of our women have been forced into prostitution.
Thus, after a number of inadequate and failed accreditation schemes, the Secretary of Labor issued on August
16, 1993, D.O. No. 28, establishing the Entertainment Industry Advisory Council (EIAC), the policy advisory body
of DOLE on entertainment industry matters.
9
Acting on the recommendations of the said body, the Secretary of
Labor, on January 6, 1994, issued the assailed orders. These orders embodied EIAC's Resolution No. 1, which
called for guidelines on screening, testing and accrediting performing overseas Filipino artists. Significantly, as
the respondent court noted, petitioners were duly represented in the EIAC,
10
which gave the recommendations
on which the ARB and other requirements were based.
Clearly, the welfare of Filipino performing artists, particularly the women was paramount in the issuance of
Department Order No. 3. Short of a total and absolute ban against the deployment of performing artists to "high
risk" destinations, a measure which would only drive recruitment further underground, the new scheme at the
very least rationalizes the method of screening performing artists by requiring reasonable educational and
artistic skills from them and limits deployment to only those individuals adequately prepared for the
unpredictable demands of employment as artists abroad. It cannot be gainsaid that this scheme at least lessens
the room for exploitation by unscrupulous individuals and agencies.
Moreover, here or abroad, selection of performing artists is usually accomplished by auditions, where those
deemed unfit are usually weeded out through a process which is inherently subjective and vulnerable to bias
and differences in taste. The ARB requirement goes one step further, however, attempting to minimize the
subjectivity of the process by defining the minimum skills required from entertainers and performing artists. As
the Solicitor General observed, this should be easily met by experienced artists possessing merely basic skills.
The test are aimed at segregating real artists or performers from those passing themselves off as such, eager to
accept any available job and therefore exposing themselves to possible exploitation.
As to the other provisions of Department Order No. 3 questioned by petitioners, we see nothing wrong with the
requirements for document and booking confirmation (D.O. 3-C), a minimum salary scale (D.O. 3-E), or the
requirement for registration of returning performers. The requirement for a venue certificate or other
documents evidencing the place and nature or work allows the government closer monitoring of foreign
employers and helps keep our entertainers away from prostitution fronts and other worksites associated with
unsavory, immoral, illegal or exploitative practices. Parenthetically, none of these issuances appear to us, by any
stretch of the imagination, even remotely unreasonable or arbitrary. They address a felt need of according
greater protection for an oft-exploited segment of our OCW's. They respond to the industry's demand for
clearer and more practicable rules and guidelines. Many of these provisions were fleshed out following
recommendations by, and after consultations with, the affected sectors and non-government organizations. On
the whole, they are aimed at enhancing the safety and security of entertainers and artists bound for Japan and
other destinations, without stifling the industry's concerns for expansion and growth.
In any event, apart from the State's police power, the Constitution itself mandates government to extend the
fullest protection to our overseas workers. The basic constitutional statement on labor, embodied in Section 18
of Article II of the Constitution provides:
Sec. 18. The State affirms labor as a primary social economic force. It shall protect the rights of workers
and promote their welfare.
More emphatically, the social justice provisions on labor of the 1987 Constitution in its first paragraph states:
The State shall afford full protection to labor, local and overseas, organized and unorganized and
promote full employment and equality of employment opportunities for all.
Obviously, protection to labor does not indicate promotion of employment alone. Under the welfare and social
justice provisions of the Constitution, the promotion of full employment, while desirable, cannot take a backseat
to the government's constitutional duty to provide mechanisms for the protection of our workforce, local or
overseas. As this Court explained in Philippine Association of Service Exporters (PASEI) v. Drilon,
11
in reference to
the recurring problems faced by our overseas workers:
What concerns the Constitution more paramountly is that such an employment be above all, decent,
just, and humane. It is bad enough that the country has to send its sons and daughters to strange lands
because it cannot satisfy their employment needs at home. Under these circumstances, the Government
is duty-adequate protection, personally and economically, while away from home.
We now go to petitioners' assertion that the police power cannot, nevertheless, abridge the right of our
performing workers to return to work abroad after having earlier qualified under the old process, because,
having previously been accredited, their accreditation became a "property right," protected by the due process
clause. We find this contention untenable.
A profession, trade of calling is a property right within the meaning of our constitutional guarantees. One cannot
be deprived of the right to work and right to make a living because these rights are property rights, the arbitrary
and unwarranted deprivation of which normally constitutes an actionable wrong.
12

Nevertheless, no right is absolute, and the proper regulation of a profession, calling, business or trade has
always been upheld as a legitimate subject of a valid exercise of the police power by the state particularly when
their conduct affects either the execution of legitimate governmental functions, the preservation of the State,
the public health and welfare and public morals. According to the maxim, sic utere tuo ut alienum non laedas, it
must of course be within the legitimate range of legislative action to define the mode and manner in which
every one may so use of his own property so as not to pose injury to himself or others.
13

In any case, where the liberty curtailed affects at most the rights of property, the permissible scope of
regulatory measures is certainly much
wider.
14
To pretend that licensing or accreditation requirements violates the due process clause is to ignore the
settled practice, under the mantle of the police power, of regulating entry to the practice of various trades or
professions. Professionals leaving for abroad are required to pass rigid written and practical exams before they
are deemed fit to practice their trade. Seamen are required to take tests determining their seamanship. Locally,
the Professional Regulation Commission has began to require previously licensed doctors and other
professionals to furnish documentary proof that they has either re-trained or had undertaken continuing
education courses as a requirement for renewal of their licenses. It is not claimed that these requirements pose
an unwarranted deprivation of a property right under the due process clause. So long as professionals and other
workers meet reasonable regulatory standards no such deprivation exists.
Finally, it is a futile gesture on the part of petitioners to invoke the non-impairment clause of the Constitution to
support their argument that the government cannot enact the assailed regulatory measures because they
abridge the freedom to contract. In Philippine Association of Service Exporters, Inc. vs. Drilon, we held that "[t]he
non-impairment clause of the Constitution... must yield to the loftier purposes targeted by the
government."
15
Equally important, into every contract is read provisions of existing law, and always, a
reservation of the police power for so long as the agreement deals with a subject impressed with the public
welfare.
A last point. Petitioners suggest that the singling out of entertainers and performing artists under the assailed
department orders constitutes class legislation which violates the equal protection clause of the Constitution.
We do not agree.
The equal protection clause is directed principally against undue favor and individual or class privilege. It is not
intended to prohibit legislation which is limited to the object to which it is directed or by the territory in which it
is to operate. It does not require absolute equality, but merely that all persons be treated alike under like
conditions both as to privileges conferred and liabilities imposed.
16
We have held, time and again, that the equal
protection clause of the Constitution does not forbid classification for so long as such classification is based on
real and substantial differences having a reasonable relation to the subject of the particular legislation.
1
7 If
classification is germane to the purpose of the law, concerns all members of the class, and applies equally to
present and future conditions, the classification does not violate the equal protection guarantee.
In the case at bar, the challenged Department Order clearly applies to all performing artists and entertainers
destined for jobs abroad. These orders, we stressed hereinfore, further the Constitutional mandate requiring
government to protect our workforce, particularly those who may be prone to abuse and exploitation as they
are beyond the physical reach of government regulatory agencies. The tragic incidents must somehow stop, but
short of absolutely curtailing the right of these performers and entertainers to work abroad, the assailed
measures enable our government to assume a measure of control.
WHEREFORE, finding no reversible error in the decision sought to be reviewed, petition is hereby DENIED.
SO ORDERED.
Padilla, Bellosillo, Vitug and Hermosisima, Jr., JJ., concur.
Footnotes
1 EIAC, Res. No. 1.
2 Noble State Bank v. Haskel, 219 US 112 (1911).
3 Smith, Bell and Co. v. Natividad, 40 Phil 136 (1919).
4 39 Phil 660, 708 (1919).
5 Id, at 708-709.
6 Source: National Statistics Office, 1992.
7 Philippine Association of Service Exporters, Inc. v. Drilon 163 SCRA 386, 392 (1988).
8 Id.
9 Department Order No. 28 vests the EIAC with the following principal functions:
a) recommend to the DOLE policies, plans and programs for the development of the
entertainment industry, local and overseas, including but not limited to talent training and
upgrading, employment standards and other internationally acceptable trade practices;
b) promote ethical business standards and dignified workplaces;
c) act as the coordinating body for all training programs and technical assistance to the
entertainment industry;
d) advise the DOLE on the institutionalization of an internationally acceptable system of
manpower development, talent protection and welfare;
e) assist the appropriate agencies, private or public in the implementation of a trainors training
and upgrading program;
f) review existing issuances on the industry including the system of training, testing and
accreditation of performing artists/talents and recommend to the Secretary such measures of
schemes as are deemed necessary for its proper compliance. . . .
10 The EIAC is chaired by an Undersecretary of Labor and is composed of 3 representatives from the
government, 2 representatives from the employers' sector, one representative from the talent
developers, 2 representatives from the workers' sector and one representative from the Non-
government Organizations.
11 Id.
12 Phil. Movie Workers' Assn. v. Premier Productions, Inc., 92 Phil 8423 (1953); National Labor Union vs.
Court of Industrial Relations, 68 Phil 732 (1939).
13 Case vs. Board of Health, 24 Phil 250, 280 (1913).
14 Ermita Malate Hotel and Motel Operators vs. City of Manila, 20 SCRA 849 (1967).
15 Supra, note 6, at 397.
16 Itchong, etc., et al, vs. Hernandez, 101 Phil 1155 (1957).
17 Villegas vs. Hiu Chiong Tsai Pao Ho, 86 SCRA 272 (1978).


SECOND DIVISION
[G.R. No. 131656. October 12, 1998]
ASIAN CENTER FOR CAREER AND EMPLOYMENT SYSTEM AND SERVICES, INC. (ACCESS), petitioner, vs. NATIONAL
LABOR RELATIONS COMMISSION and IBNO MEDIALES, respondents.
D E C I S I O N
PUNO, J.:
In this petition for certiorari, petitioner ASIAN CENTER FOR CAREER & EMPLOYMENT SYSTEM & SERVICES,
INC. (ACCESS) seeks to modify the monetary awards against it in the Decision of respondent National Labor Relations
Commission (NLRC), dated October 14, 1997, a case for illegal dismissal.
The records disclose that petitioner hired respondent IBNO MEDIALES to work as a mason in Jeddah, Saudi Arabia,
with a monthly salary of 1,200 Saudi Riyals (SR). The term of his contract was two (2) years, from February 28, 1995
until February 28, 1997.
On May 26, 1996, respondent applied with petitioner for vacation leave with pay which he earned after working for
more then a year. His application for leave was granted. While en route to the Philippines, his co-workers informed him
that he has been dismissed from service. The information turned out to be true.
On June 17, 1996, respondent filed a complaint with the labor arbiter for illegal dismissal, non-payment of overtime
pay, refund of transportation fare, illegal deductions, non-payment of 13
th
month pay and salary for the unexpired
portion of his employment contract.
On March 17, 1997, the labor arbiter found petitioner guilty of illegal dismissal.
[1]
The dispositive portion reads:
IN VIEW OF THE FOREGOING, judgment is hereby rendered declaring the illegality of complainants dismissal
and ordering the respondent ACCESS and/or ABDULLAH LELINA to pay the complainant the amount of SR
13,200 representing complainants payment for the unexpired portion of his contract and refund of the
illegality deducted amount less P5,000.00, the legally allowed placement fee.
Respondent are further ordered to pay attorneys fees equivalent to ten percent (10%) of the judgment
award or the amount of SR 1,320, within ten (10) days from receipt hereof.
All other issues are dismissed for lack of merit.
SO ORDERD. (emphasis supplied)
It is noteworthy, however, that in the body of his decision, the labor arbiter applied Section 10 R.A. 8042,
[2]
the law
relative to the protection of Filipino overseas-workers, and computed private respondents salary for the unexpired
portion of his contract as follows: SR1,200 x 3 months = SR3,600.
On appeal by petitioner, the NLRC affirmed the factual findings of the labor arbiter but modified the appealed
decision by deleting the order of refund of excessive placement fee for lack of jurisdiction.
[3]

Petitioner moved for reconsideration with respect to the labor arbiters award of SR13,200 in the dispositive
portion of the decision, representing respondents salary for the unexpired portion of his contract. invoking Section 10
R.A. 8042. Petitioner urged that its liability for respondents salary is for only three (3) months. Petitioner claimed that it
should pay only SR 3.600 (SR 1,200 x 3 months) for the unexpired portion of respondents employment and SR360 (10%
of SR3,600) for attorneys fees.
[4]

The NLRC denied petitioners motion. It ruled that R.A. 8042 does not apply as respondents employment which
started in February 1995 occurred prior to its effectivity on July 15, 1995.
[5]

Hence, this petition for certiorari.
In the case at bar, petitioners illegal dismissal from service is no longer disputed. Petitioner merely impugns the
monetary awards granted by the NLRC to private respondent. It submits that although the unexpired portion of private
respondents employment contract is eight (8) months,
[6]
it is liable to pay respondent only three (3) months of his basic
salary, pursuant to Section 10 of R.A. 8042, or SR1,200 (monthly salary) multiplied by 3 months, for a total of
SR3,600. Petitioner claims that the NLRC erred in ruling that as private respondents employment started only on
February 28, 1995, R.A. 8042, which took effect on July 15, 1995, would not apply to his case. Petitioner argues that it is
not the date of employment but the date of dismissal which should be considered in determining the applicability of R.A.
8042. Petitioner prays that the award in the NLRC Decision dated October 14, 1997, be changed to SR3,600 instead of
13,200 and that the award of attorneys fees be deleted.
We affirm with modifications.
As a rule, jurisdiction is determined by the law at the time of the commencement of the action.
[7]
In the case at bar,
private respondents cause of action did not accrue on the date of his date of his employment or on February 28,
1995. His cause of action arose only from the-time he was illegally dismissed by petitioner from service in June 1996,
after his vacation leave expired. It is thus clear that R.A. 8042 which took effect a year earlier in July 1995 applies to
the case at bar.
Under Section 10 of R.A. 8042, a worker dismissed from overseas employment without just, valid or authorized
cause is entitled to his salary for the unexpired portion of his employment contract or for three (3) months for every
year of the unexpired term, whichever is less.
In the case at bar, the unexpired portion of private respondents employment contract is eight (8) months. Private
respondent should therefore be paid his basic salary corresponding to three (3) months or a total of SR3,600.
[8]

We note that this same computation was made by the labor arbiter in the body of his decision.
[9]
Despite said
computation in the body of the decision, however, the labor arbiter awarded higher sum (SR13,200) in
thedispositive portion.
The general rule is that where there is a conflict between the dispositive portion or the fallo and the body of the
decision, the fallo controls. This rule rests on the theory that the fallo is the final order while the opinion in the body is
merely a statement ordering nothing. However, where the inevitable conclusion from the body of the decision is so
clear as to show that there was a mistake in the dispositive portion, the body of the decision will prevail.
[10]

We find that the labor arbiters award of a higher amount in the dispositive portion was clearly an error for there is
nothing in the text of the decision which support the award of said higher amount. We reiterate that the correct award
to private respondent for the unexpired portion of his employment contract is SR3,600.
We come now to the award of attorneys fees in favor of private respondent. Article 2208 of the Civil Code allows
attorneys fees to be awarded when its claimant is compelled to litigate with third persons or to incur expenses to
protect his interest by reason of an unjustified act or omission of the party for whom it is sought. Moreover, attorneys
fees are recoverable when there is sufficient showing of bad faith.
[11]
The Labor Code,
[12]
on the other hand, fixes the
attorneys fees that may be recovered in an amount which should not exceed 10% of the total amount of wages
awarded.
In the case at bar, petitioners bad faith in dismissing private respondent is manifest. Respondent was made to
believe that he would be temporarily leaving Jeddah, Kingdom of Saudi Arabia, for a 30-day vacation leave with
pay. However, while on board the plane back to the Philippines, his co-employees told him that he has been dismissed
from his job as he was given only a one-way plane ticket by petitioner. True enough, private respondent was not
allowed to return to his jobsite in Jeddah after his vacation leave. Thus, private respondent was compelled to file an
action for illegal dismissal with the labor arbiter and hence entitled to an award of attorneys fees.
IN VIEW OF THE FOREGOING, the decision of the public respondent National Labor Relations Commission, dated
October 14, 1997, is AFFIRMED with modifications: petitioner is ordered to pay private respondent IBNO MEDIALES
the peso equivalent of the amounts of SR3,600 for the unexpired portion of his employment contract, and SR360 for
attorneys fees. No costs.
SO ORDERED.
Regalado,(Chairman), Melo, Mendoza, and Martinez, JJ., concur.



[1]
Decision, Rollo, pp. 11-20.
[2]
Entitled: Migrant Workers and Overseas Filipinos Act of 1995.
[3]
NLRC Decision, dated August 18, 1997; Rollo, pp. 26-32.
[4]
Motion for Reconsideration, Rollo, pp. 33-35.
[5]
Decision, dated October 14, 1997; Rollo, pp. 36-38.
[6]
Respondent was dismissed from service in June 1996 (after his vacation leave), while his employment contract was
supposed to end on February 28, 1997.
[7]
Erectors, Inc. vs. NLRC, 256 629, 637, [1996], citing Philippine-Singapore Ports. Corp. vs. NLRC, 218 SRA 77 [1993].
[8]
Computed as follows: monthly salary of SR1,200 x 3 months.
[9]
Supra.
[10]
Olac, vs. Court of Appeals, 213 SCRA 321, 328 [1992], citing Aguirre vs. Aguirre, 58 SCRA 461 [1974] and Magdalena
Estate, Inc. vs. Calauag, 11 SCRA 333 [1964].
[11]
Tumbiga vs. National Labor Relations Commission, 274 SCRA 338, 349 [1997].
[12]
Article 111, Chapter III, Title II, Book Three.


Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 160952 August 20, 2004
MARCIAL GU-MIRO, petitioner,
vs.
ROLANDO C. ADORABLE and BERGESEN D.Y. MANILA, respondents.


D E C I S I O N


YNARES-SANTIAGO, J.:
Before us is a petition for review on certiorari of the decision of the Court of Appeals in CA-G.R. SP No. 66131 dated May
29, 2003,
1
which modified the decision of the National Labor Relations Commission (NLRC) by increasing the incentive
bonus awarded to petitioner from US$594.56 to US$1189.12.
Petitioner Marcial Gu-Miro was formerly employed as a Radio Officer of respondent Bergesen D.Y. Philippines, which
acted for and in behalf of its principal Bergesen D.Y. ASA, on board its different vessels. A Certification dated April 14,
1998 was issued by Bergesen D.Y. Philippines, Inc.'s President and General Manager Rolando C. Adorable showing that
petitioner served in the company on board its vessels starting 1988.
2
The case before us involves an employment
contract signed by petitioner to commence service on board the M/V HEROS, which stipulated a monthly salary of
US$929.00 for a period of eight (8) months. It also provided for overtime pay of US$495.00 per month and vacation
leave with pay in the amount of US$201.00 per month equivalent to six and a half days.
3
The contract of employment
was signed on March 18, 1996 and petitioner commenced work on April 15, 1996.
Record shows that respondent company traditionally gives an incentive bonus termed as Re-employment Bonus to
employees who decide to rejoin the company after the expiration of their employment contracts. After the expiration of
petitioner's contract in December 1996, the same was renewed by respondent company until September 9, 1997, as
stated in the Certification issued by Bergesen D.Y. Philippines, Inc. In September 1997, petitioner's services were
terminated due to the installation of labor saving devices which made his services redundant. Upon his forced
separation from the company, petitioner requested that he be given the incentive bonus plus the additional allowances
he was entitled to. Respondent company, however, refused to accede to his request.
Thus, in June 1999 petitioner filed a complaint with the NLRC, Regional Arbitration Branch of Cebu, for payment of the
incentive bonus from April 15, 1996 to September 15, 1997, 10% of the basic wage, unclaimed payment for incentive
bonus from September 1993 to June 1994, non-remittance of provident fund from July 1992 to June 1994, moral and
exemplary damages as well as attorney's fees. On December 29, 1999, the complaint was provisionally dismissed by the
NLRC due to the failure of petitioner to file the required position paper. Petitioner re-filed the complaint on March 2,
2000 accordingly.
In a Decision dated June 6, 2000, the Labor Arbiter dismissed the case for lack of merit,
4
based on the following findings:
x x x. "Incentive bonus" or reemployment bonus are benefits not found in the POEA approved contract. These
are benefits which are specifically granted pursuant to an internal memorandum entitled "Employment
Conditions for Filipino Seafarers serving on board vessels of Bergesen D.Y. ASA". As stated in the said internal
memorandum, entitlement to the benefits therein (is) not automatic but (is) subject to some conditions. As
clearly stated in the said memorandum, the reemployment bonus is an "incentive bonus system for
reemployment upon signing for a subsequent period." x x x. In order that a seafarer, like the complainant, be
entitled to reemployment/incentive bonus, he must satisfy all of the following requirements, to wit:
1) He must be employed in a vessel under a principal who is a member of the reemployment bonus
scheme;
2) He must have been an officer of the principal member's vessel subject to the additional conditions
stated in page 2 of the aforementioned internal memorandum; and
3) After serving in a principal-member's vessel, he must be reemployed in another or the same principal-
member's vessel.
To avail of the benefits under this scheme, seafarers like the complainant has to prove that he met all the
foregoing conditions. It is, thus, his burden to prove that he is entitled to the said benefit. Complainant, however,
miserably failed to adduce evidence that he met all the foregoing conditions for entitlement to the benefit. He
relied on his unsubstantiated allegation that a certain Captain D. Ramirez received an incentive bonus even if he
did not sign up with the Company. x x x.
x x x x x x x x x
For obvious reasons, complainant's claims for moral and exemplary damages as well as attorney's fees are
denied. x x x.
5

Petitioner appealed to the NLRC, which set aside the Labor Arbiter's decision and ordered respondents to pay petitioner
the amount of US$594.56 in a Decision dated March 5, 2001. The pertinent portion of the NLRC's decision states:
The Contract of Employment entered into between the complainant and the respondents specifically set a term
of eight (8) months which was supposed to be from April 15, 1996 up to December 14, 1996. The complainant's
length of service from December 15, 1996 to September 9, 1997, or a period of nine (9) months, more or less,
was an extended term of employment. A closer look at the facts shows that the extended term was even longer
than the original term of the contract.
x x x x x x x x x
[W]e construe that the extended term of the contract of employment from December 15, 1996 up to September
9, 1997 was considered as re-employment of the complainant. And when there was re-employment, it is
presumed that all the conditions set forth by the respondents in their established company written policy
entitled "Employment Conditions for Filipino Seafarers Serving Onboard Vessels of Bergesen D.Y. ASA" are
deemed complied with. The pertinent portion of the said company policy states:
2. Re-employment bonus
The company has established an incentive bonus system for re-employment upon signing for a
subsequent period.
The conditions are as follows:
x x x x x x x x x
Radio Officers/Electricians Serving onboard bulk carriers- 8% of basic wage per month of actual service.
To do otherwise, we would allow the respondent to circumvent its own established policy to merely extending
the original contract of employment.
6

Petitioner and respondents filed separate Motions for Reconsideration which were both denied by the NLRC in its
Resolution dated April 24, 2001.
Not satisfied with the monetary award, petitioner filed a petition for review with the Court of Appeals claiming that
there was an error in computing the amount of the incentive bonus he is entitled to. Petitioner argued that he should be
considered as a regular employee of respondent company and thus, entitled to backwages or, at the very least,
separation pay.
The Court of Appeals, on May 29, 2003, rendered the assailed Decision where it ruled:
WHEREFORE, the petition is GRANTED. The assailed Decision dated March 5, 2001 is hereby MODIFIED
increasing the award of incentive bonus from US$594.56 to US$1189.12.
SO ORDERED.
7

In arriving at its decision, the appellate court made the following findings:
It is uncontroverted that the company grants incentive bonus for re-employment upon signing for a subsequent
period. For radio officers onboard bulk carriers, it shall be 8% of the basic wage per month of actual service. In
this case, we find nothing in the record to show that the classification of the vessel to which the petitioner was
deployed is a Gas/LPG Tanker, which would make him entitled to 10% instead of 8% of the basic wage as
incentive bonus. Thus, the public respondent correctly applied the rate of 8% of the basic wage per month of
actual service, the basic wage in this case being the amount stipulated in the contract of employment, i.e.,
US$929.00, and does not include the stipulated rate for overtime pay.
The question now is the application of the provision of the memorandum with respect to the length of actual
service. Record shows that after the expiration of the original eight-month employment contract on December
15, 1996, the petitioner was in fact re-employed when his service was extended for another nine (9) months or
up to September 1997. This unquestionably entitled him to the incentive bonus for the 8-month period covered
by the contract and which was correctly awarded to him by the public respondent NLRC. However, as to the
succeeding period, although it was not covered by a written contract, it is unrebutted that the petitioner was
actually made to suffer work during that period. Hence, there was a monthly re-employment of the petitioner
for the succeeding 9 months. Conformably, since the incentive bonus is given for re-employment upon signing
for a subsequent period, for purposes of computing the same, the petitioner is deemed to have been re-
employed not only for the 8 months covered by the contract but also for the succeeding 8 months preceding the
last month when he was terminated. x x x.
x x x x x x x x x
As for the claim for backwages or separation pay, we note that these claims were neither raised in the
petitioner's position paper nor in the motion for reconsideration filed before the NLRC; hence, they can no
longer be raised for the first time in this petition. x x x.
8

Hence, the instant petition for certiorari based on the following grounds:
I. THE HONORABLE COURT OF APPEALS ERRED WHEN IT PLACED THE BURDEN UPON PETITIONER TO PROVE
THAT M/V HEROS IS AN LPG/GAS TANKER.
II. CONSIDERING THAT PETITIONER HAD WORKED FOR BERGESEN D.Y. PHILIPPINES FOR AND IN BEHALF OF ITS
PRINCIPAL BERGESEN D.Y. ASA FOR TEN (10) LONG YEARS ABOARD ITS DIFFERENT VESSELS, PETITIONER SHOULD
HAVE BEEN CONSIDERED AS A REGULAR EMPLOYEE BY THE COURT OF APPEALS.
III. THE HONORABLE COURT OF APPEALS LIKEWISE ERRED WHEN IT SAID IN ITS DECISION THAT PETITIONER
FAILED TO RAISE THE ISSUE OF BACKWAGES AND SEPARATION PAY IN THE MOTION FOR RECONSIDERATION
FILED WITH THE NLRC.
9

In this petition, we are called upon to resolve two basic issues: The first concerns what percentage to use in computing
the incentive bonus which petitioner is entitled to. In the memorandum entitled Employment Conditions for Filipino
Seafarers Serving Onboard Vessels of Bergesen D.Y. ASA (Employment Conditions Memorandum), Radio Officers are
entitled to re-employment bonus equivalent to a certain percentage of their basic wage per month of actual service. If
the employee served onboard a bulk carrier, he is entitled to 8% of his basic wage per month of actual service.
Alternatively, if service was done onboard a gas carrier tanker, the employee is entitled to 10% of his basic wage per
month of actual service.
The NLRC and the Court of Appeals both agree that petitioner failed to adduce concrete proof to show that M/V HEROS
is a Gas/LPG Tanker and not a bulk carrier. Hence, the Court of Appeals upheld the use of 8% by the NLRC as multiplier
to compute the incentive bonus. Respondent company argues that petitioner failed to allege the nature of M/V HEROS
at the earliest opportunity, belatedly alleging this information in the Motion for Reconsideration with the NLRC.
Petitioner insists that M/V HEROS is a Gas/LPG Tanker which entitles him to 10% of his basic wage as incentive bonus;
and that the Court of Appeals erred in ruling that it was petitioner's burden to prove the classification of M/V HEROS.
We rule in petitioner's favor. The registration papers, which contain the vessel classification of M/V HEROS, are the
conclusive evidence that petitioner needs to prove his allegation. However, these are in the custody of respondent
company or its mother company, Bergesen D.Y. ASA. Interestingly, respondent company never presented the
registration papers in evidence.
We find that respondent company's failure to controvert the allegation, when it had the opportunity and resources to
do so, works in favor of petitioner. Time and again we have held that should doubts exist between the evidence
presented by the employer and the employee, the scales of justice must be tilted in favor of the latter.
10
Moreover, the
law creates the presumption that evidence willfully suppressed would be adverse if produced.
11

Consequently, the amount of incentive bonus termed as re-employment bonus which petitioner is entitled to should be
computed as follows:
Salary per month = US$929.00
No. of months of actual service = 16 months
Rate = 10% of basic wage
US$929.00/month x 16 months x 10% = US$1,486.40
The second and third grounds raised in this petition are related, based on petitioner's allegation that he should be
considered a regular employee of respondent company, having been employed onboard the latter's different vessels for
the span of 10 years. Hence, petitioner claims that he is entitled to backwages or at the very least separation pay,
invoking our decision in Millares, et al. v. NLRC
12
where it was held that the repeated re-hiring of a Chief Engineer of a
shipping company for 20 years is sufficient evidence of the necessity and indispensability of the employee's service to
the employer's business or trade. Hence, applying the express provision of Article 280 of the Labor Code,
13
such an
employee should be considered as a regular employee.
Petitioner's argument is not well-taken. The decision of Millares, et al. v. NLRC was reconsidered and set aside in a
Resolution
14
where it was held:
[I]t is clear that seafarers are considered contractual employees. They can not be considered as regular
employees under Article 280 of Labor Code. Their employment is governed by the contracts they sign every time
they are rehired and their employment is terminated when the contract expires. Their employment is
contractually fixed for a certain period of time. They fall under the exception of Article 280 whose employment
has been fixed for a specific project or undertaking the completion or termination of which has been determined
at the time of the engagement of the employee or where the nature of the work or services to be performed is
seasonal in nature and employment is for the duration of the season.
x x x x x x x x x
Moreover, it is an accepted maritime industry practice that employment of seafarers (is) for a fixed period only.
Constrained by the nature of their employment which is quite peculiar and unique in itself, it is for the mutual
interest of both the seafarer and the employer why employment status must be contractual only or for a certain
period of time. Seafarers spend most of their time at sea and understandably, they cannot stay for a long and an
indefinite period of time at sea. Limited access to shore society during the employment will have an adverse
impact on the seafarer. The national, cultural and lingual diversity among the crew during the [Contract of
Enlistment] is a reality that necessitates the limitation of its period.
15

Clearly, petitioner cannot be considered as a regular employee notwithstanding that the work he performs is necessary
and desirable in the business of respondent company. As expounded in the above-mentioned MillaresResolution, an
exception is made in the situation of seafarers. The exigencies of their work necessitates that they be employed on a
contractual basis.
Thus, even with the continued re-hiring by respondent company of petitioner to serve as Radio Officer onboard
Bergesen's different vessels, this should be interpreted not as a basis for regularization but rather a series of contract
renewals sanctioned under the doctrine set down by the second Millares case. If at all, petitioner was preferred because
of practical considerationsnamely, his experience and qualifications. However, this does not alter the status of his
employment from being contractual.
With respect to the claim for backwages and separation pay, it is now well-settled that the award of backwages and
separation pay in lieu of reinstatement are reliefs that are awarded to an employee who is unjustly dismissed.
16
In the
instant case, petitioner was separated from his employment due to the termination of an impliedly renewed contract
with respondent company. Hence, there is no illegal or unjust dismissal.
WHEREFORE, premises considered, the petition is GRANTED IN PART. The Decision of the Court of Appeals in CA-G.R. SP
No. 66131 dated May 29, 2003 is MODIFIED in that the award of incentive bonus is increased from US$1189.12 to
US$1,486.40. Petitioner's claim that he be declared a regular employee and awarded backwages and separation pay is
DENIED for lack of merit.
SO ORDERED.
Davide, Jr., C.J., (Chairman), Quisumbing, Carpio, and Azcuna, JJ., concur.


Footnotes
1
Rollo, pp. 25-33; penned by Associate Justice Delilah Vidallon-Magtolis and concurred in by Associate Justices
Remedios A. Salazar-Fernando and Edgardo F. Sundiam.
2
Annex D, Court of Appeals Rollo, p. 74.
3
Annex 1, Court of Appeals Rollo, p. 46.
4
Court of Appeals Rollo, p. 59.
5
Id., pp. 56-58.
6
Id., pp. 23-24.
7
Rollo, p. 33.
8
Id., pp. 31-32.
9
Id., pp. 16-18.
10
Asuncion v. NLRC, G.R. No. 129329, 31 July 2001, 362 SCRA 56, citing Dizon v. NLRC, G.R. No. 79554, 14
December 1989, 180 SCRA 52; These policies are embodied in Articles 3 and 4 of the Labor Code, which read:
ART. 3. Declaration of basic policy. The State shall afford protection to labor, promote full
employment, ensure equal work opportunities regardless of sex, race or creed and regulate the
relations between workers and employers. x x x
ART 4. Construction in favor of labor. All doubts in the implementation and interpretation of the
provisions of this Code, including its implementing rules and regulations, shall be resolved in favor of
labor.
11
Rules of Court, Rule 131, Sec. 3 (e).
12
G.R. No. 110524, 14 March 2000, 328 SCRA 79.
13
Article 280. Regular and casual employment. The provisions of written agreement to the contrary
notwithstanding and regardless of the oral agreement of the parties, an employment shall be deemed to be
regular where the employee has been engaged to perform activities which are usually necessary or desirable in
the usual business or trade of the employer, except where the employment has been fixed for a specific project
or undertaking the completion or termination of which has been determined at the time of the engagement of
the employee or where the work or services to be performed is seasonal in nature and the employment is for
the duration of the season.
An employment shall be deemed to be casual if it is not covered by the preceding paragraph: Provided, That,
any employee who has rendered at least one year of service, whether such service is continuous or broken, shall
be considered a regular employee with respect to the activity in which he is employed and his employment shall
continue while such activity exists.
14
Millares, et al. v. NLRC, G.R. No. 110524, 29 July 2002, 385 SCRA 306.
15
Id., pp. 318-319.
16
Bustamante v. NLRC, G.R. No. 111651, 28 November 1996, 265 SCRA 61; Times Transit Credit Coop., Inc. v.
NLRC, G.R. No. 117105, 2 March 1999, 304 SCRA 11; De Paul/King Philip Customs Tailor v. NLRC, G.R. No. 129824,
10 March 1999, 304 SCRA 448; Philippine Industrial Security Agency Corporation v. Dapiton and NLRC, G.R. No.
127421, 8 December 1999, 320 SCRA 124; Vinoya v. NLRC, G.R. No. 126586, 25 August 2000, 339 SCRA
65; Prudential Bank and Trust Company v. Reyes, G.R. No. 141093, 20 February 2001, 352 SCRA 316.