Republic of the Philippines
Supreme Court
Manila
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ANTONIO M. SERRANO, |
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G.R. No. 167614 |
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Petitioner, |
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Present: |
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PUNO,
C.J., |
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QUISUMBING, |
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YNARES-SANTIAGO, |
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CARPIO, |
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AUSTRIA-MARTINEZ, |
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versus - |
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CARPIO
MORALES, |
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TINGA, |
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CHICO-NAZARIO, |
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VELASCO, Jr., |
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NACHURA, |
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LEONARDO-DE CASTRO, |
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BRION, and |
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Gallant MARITIME SERVICES, |
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PERALTA, JJ. |
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INC. and MARLOW NAVIGATION |
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CO., INC., |
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Promulgated: |
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Respondents. |
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March
24, 2009 |
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D E C I S I O N
AUSTRIA-MARTINEZ, J.:
For
decades, the toil of solitary migrants has helped lift entire families and
communities out of poverty.
Their earnings have built houses, provided health care, equipped schools and
planted the seeds of businesses. They have woven together the world by
transmitting ideas and knowledge from country to country. They have provided
the dynamic human link between cultures, societies and economies. Yet,
only recently have we begun to understand not only how much international
migration impacts development, but how smart public policies can magnify this
effect.
United Nations
Secretary-General Ban Ki-Moon
Global Forum on Migration
and Development
Brussels, July 10, 2007[1]
For Antonio Serrano (petitioner), a Filipino
seafarer, the last clause in the 5th paragraph of Section 10,
Republic Act (R.A.) No. 8042,[2] to wit:
Sec.
10. Money Claims. - x x x In case
of termination of overseas employment without just, valid or authorized cause
as defined by law or contract, the workers shall be entitled to the full
reimbursement of his placement fee with interest of twelve percent (12%) per
annum, plus
his salaries for the unexpired portion of his employment contract or
for three (3) months for every year of the unexpired term, whichever is less.
x
x x x (Emphasis and underscoring
supplied)
does
not magnify the contributions of overseas Filipino workers (OFWs) to national
development, but exacerbates the hardships borne by them by unduly limiting
their entitlement in case of illegal dismissal to their lump-sum salary either
for the unexpired portion of their employment contract “or for three months for
every year of the unexpired term, whichever is less” (subject clause). Petitioner claims that the last clause
violates the OFWs' constitutional rights in that it impairs the terms of their
contract, deprives them of equal protection and denies them due process.
By way of Petition for Review under Rule 45 of
the Rules of Court, petitioner assails the December 8, 2004 Decision[3] and
April 1, 2005 Resolution[4] of the
Court of Appeals (CA), which applied the subject clause, entreating this Court
to declare the subject clause unconstitutional.
Petitioner was hired by Gallant Maritime
Services, Inc. and Marlow Navigation Co., Ltd. (respondents) under a Philippine
Overseas Employment Administration (POEA)-approved Contract of Employment with
the following terms and conditions:
Duration
of contract 12
months
Position Chief Officer
Basic monthly salary US$1,400.00
Hours of work 48.0
hours per week
Overtime US$700.00
per month
Vacation leave with pay 7.00 days
per month[5]
On
Respondents did not deliver on their promise to
make petitioner Chief Officer.[7] Hence, petitioner refused to stay on as
Second Officer and was repatriated to the
Petitioner's employment contract was for a
period of 12 months or from March 19, 1998 up to March 19, 1999, but at the
time of his repatriation on May 26, 1998, he had served only two (2) months and
seven (7) days of his contract, leaving
an unexpired portion of nine (9) months and twenty-three (23) days.
Petitioner filed with the Labor Arbiter (LA) a
Complaint[9] against
respondents for constructive dismissal and for payment of his money claims in
the total amount of US$26,442.73, broken down as follows:
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May 27/31, 1998 (5 days) incl. Leave pay |
US$ 413.90 |
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June 01/30, 1998 |
2,590.00 |
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July 01/31, 1998 |
2,590.00 |
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August 01/31, 1998 |
2,590.00 |
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Sept. 01/30, 1998 |
2,590.00 |
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Oct. 01/31, 1998
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2,590.00 |
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Nov. 01/30, 1998
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2,590.00 |
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Dec. 01/31, 1998
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2,590.00 |
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Jan. 01/31, 1999
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2,590.00 |
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Feb. 01/28, 1999
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2,590.00 |
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Mar. 1/19, 1999 (19 days) incl. leave pay |
1,640.00 |
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-------------------------------------------------------------------------------- |
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25,382.23 |
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Amount adjusted to chief mate's salary |
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(March 19/31, 1998 to April 1/30, 1998) + |
1,060.50[10] |
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TOTAL
CLAIM |
US$
26,442.73[11] |
as
well as moral and exemplary damages and
attorney's fees.
The LA rendered a Decision dated
WHEREFORE, premises considered, judgment is hereby
rendered declaring that the dismissal of the complainant (petitioner) by the
respondents in the above-entitled case was illegal and the respondents are
hereby ordered to pay the complainant [petitioner], jointly and severally, in
Philippine Currency, based on the rate of exchange prevailing at the time of
payment, the amount of EIGHT THOUSAND SEVEN HUNDRED SEVENTY U.S. DOLLARS
(US $8,770.00), representing the complainant’s salary for three (3) months of
the unexpired portion of the aforesaid contract of employment.
The respondents are likewise ordered to pay the
complainant [petitioner], jointly and severally, in Philippine Currency, based
on the rate of exchange prevailing at the time of payment, the amount of FORTY
FIVE U.S. DOLLARS (US$ 45.00),[12]
representing the complainant’s claim for a salary differential. In addition,
the respondents are hereby ordered to pay the complainant, jointly and
severally, in Philippine Currency, at the exchange rate prevailing at the time
of payment, the complainant’s (petitioner's) claim for attorney’s fees
equivalent to ten percent (10%) of the total amount awarded to the aforesaid
employee under this Decision.
The claims of the complainant for moral and exemplary
damages are hereby DISMISSED for lack of merit.
All other claims are hereby DISMISSED.
SO ORDERED.[13] (Emphasis
supplied)
In
awarding petitioner a lump-sum salary of US$8,770.00, the LA based his
computation on the salary period of three months only -- rather than the entire
unexpired portion of nine months and 23 days of petitioner's employment
contract - applying the subject clause. However, the LA applied the salary rate
of US$2,590.00, consisting of petitioner's “[b]asic salary, US$1,400.00/month +
US$700.00/month, fixed overtime pay, + US$490.00/month, vacation leave pay =
US$2,590.00/compensation per month.”[14]
Respondents
appealed[15]
to the National Labor Relations Commission (NLRC) to question the finding of
the LA that petitioner was illegally dismissed.
Petitioner
also appealed[16]
to the NLRC on the sole issue that the LA erred in not applying the ruling of
the Court in Triple Integrated Services, Inc. v. National Labor Relations
Commission[17]
that in case of illegal dismissal, OFWs are entitled to their salaries for the
unexpired portion of their contracts.[18]
In a
Decision dated
WHEREFORE,
the Decision dated
1. Three
(3) months salary
$1,400
x 3 US$4,200.00
2. Salary
differential 45.00
US$4,245.00
3. 10%
Attorney’s fees 424.50
TOTAL US$4,669.50
The other findings are affirmed.
SO ORDERED.[19]
The
NLRC corrected the LA's computation of the lump-sum salary awarded to
petitioner by reducing the applicable salary rate from US$2,590.00 to
US$1,400.00 because R.A. No. 8042 “does not provide for the award of overtime
pay, which should be proven to have been actually performed, and for vacation
leave pay.”[20]
Petitioner
filed a Motion for Partial Reconsideration, but this time he
questioned the constitutionality of the subject clause.[21] The NLRC denied the motion.[22]
Petitioner
filed a Petition for Certiorari[23] with
the CA, reiterating the constitutional challenge against the subject clause.[24] After initially dismissing the petition on a
technicality, the CA eventually gave due course to it, as directed by this
Court in its Resolution dated
In a
Decision dated
His Motion for Reconsideration[26] having been
denied by the CA,[27] petitioner brings
his cause to this Court on the following grounds:
I
The
Court of Appeals and the labor tribunals have decided the case in a way not in
accord with applicable decision of the Supreme Court involving similar issue of
granting unto the migrant worker back wages equal to the unexpired portion of
his contract of employment instead of limiting it to three (3) months
II
In the
alternative that the Court of Appeals and the Labor Tribunals were merely
applying their interpretation of Section 10 of Republic Act No. 8042, it is
submitted that the Court of Appeals gravely erred in law when it failed to
discharge its judicial duty to decide questions of substance not theretofore
determined by the Honorable Supreme Court, particularly, the constitutional
issues raised by the petitioner on the constitutionality of said law, which
unreasonably, unfairly and arbitrarily limits payment of the award for back
wages of overseas workers to three (3) months.
III
Even
without considering the constitutional limitations [of] Sec. 10 of Republic Act
No. 8042, the Court of Appeals gravely erred in law in excluding from
petitioner’s award the overtime pay and vacation pay provided in his contract
since under the contract they form part of his salary.[28]
On
Considering
that the parties have filed their respective memoranda, the Court now takes up
the full merit of the petition mindful of the extreme importance of the
constitutional question raised therein.
On the
first and second issues
The
unanimous finding of the LA, NLRC and CA that the dismissal of petitioner was
illegal is not disputed. Likewise not
disputed is the salary differential of US$45.00 awarded to petitioner in all
three fora. What remains disputed is
only the computation of the lump-sum salary to be awarded to petitioner by
reason of his illegal dismissal.
Applying
the subject clause, the NLRC and the CA computed the lump-sum salary of
petitioner at the monthly rate of US$1,400.00 covering the period of three
months out of the unexpired portion of nine months and 23 days of his
employment contract or a total of US$4,200.00.
Impugning
the constitutionality of the subject clause, petitioner contends that, in
addition to the US$4,200.00 awarded by the NLRC and the CA, he is entitled to
US$21,182.23 more or a total of US$25,382.23, equivalent to his salaries for
the entire nine months and 23 days left of his employment contract, computed at
the monthly rate of US$2,590.00.[31]
The
Arguments of Petitioner
Petitioner contends that the subject clause is
unconstitutional because it unduly impairs the freedom of OFWs to negotiate for
and stipulate in their overseas employment contracts a determinate employment
period and a fixed salary package.[32] It also impinges on the equal protection
clause, for it treats OFWs differently from local Filipino workers (local
workers) by putting a cap on the amount of
lump-sum salary to which OFWs are entitled in case of illegal
dismissal, while setting no limit to the
same monetary award for local workers when their dismissal is declared illegal;
that the disparate treatment is not reasonable as there is no substantial
distinction between the two groups;[33]
and that it defeats Section 18,[34]
Article II of the Constitution which guarantees the protection of the rights
and welfare of all Filipino workers, whether deployed locally or overseas.[35]
Moreover, petitioner argues that the decisions of
the CA and the labor tribunals are not in line with existing jurisprudence on
the issue of money claims of illegally dismissed OFWs. Though there are conflicting rulings on this,
petitioner urges the Court to sort them out for the guidance of affected OFWs.[36]
Petitioner further underscores that the insertion
of the subject clause into R.A. No. 8042 serves no other purpose but to benefit
local placement agencies. He marks the
statement made by the Solicitor General in his Memorandum, viz.:
Often, placement agencies, their liability being
solidary, shoulder the payment of money claims in the event that jurisdiction
over the foreign employer is not acquired by the court or if the foreign
employer reneges on its obligation. Hence, placement agencies that are in good
faith and which fulfill their obligations are unnecessarily penalized for the
acts of the foreign employer. To
protect them and to promote their continued helpful contribution in deploying
Filipino migrant workers, liability for money claims was reduced under Section
10 of R.A. No. 8042. [37] (Emphasis supplied)
Petitioner argues that in mitigating the solidary
liability of placement agencies, the subject clause sacrifices the well-being
of OFWs. Not only that, the provision
makes foreign employers better off than local employers because in cases
involving the illegal dismissal of employees, foreign employers are liable for
salaries covering a maximum of only three months of the unexpired employment
contract while local employers are liable for the full lump-sum salaries of
their employees. As petitioner puts it:
In terms of practical application, the local
employers are not limited to the amount of backwages they have to give their
employees they have illegally dismissed, following well-entrenched and
unequivocal jurisprudence on the matter. On the other hand, foreign employers
will only be limited to giving the illegally dismissed migrant workers the
maximum of three (3) months unpaid salaries notwithstanding the unexpired term
of the contract that can be more than three (3) months.[38]
Lastly, petitioner claims that the subject clause
violates the due process clause, for it deprives him of the salaries and other
emoluments he is entitled to under his fixed-period employment contract.[39]
The Arguments of Respondents
In
their Comment and Memorandum, respondents contend that the constitutional issue
should not be entertained, for this was belatedly interposed by petitioner in
his appeal before the CA, and not at the earliest opportunity, which was when
he filed an appeal before the NLRC.[40]
The
Arguments of the Solicitor General
The
Solicitor General (OSG)[41] points
out that as R.A. No. 8042 took effect on
Moreover,
the OSG emphasizes that OFWs and local workers differ in terms of the nature of
their employment, such that their rights to monetary benefits must necessarily
be treated differently. The OSG
enumerates the essential elements that distinguish OFWs from local workers:
first, while local workers perform their jobs
within Philippine territory, OFWs perform their jobs for foreign
employers, over whom it is difficult for our courts to acquire jurisdiction, or
against whom it is almost impossible to enforce judgment; and second, as held
in Coyoca v. National Labor Relations
Commission[43]
and Millares v. National Labor Relations
Commission,[44] OFWs are contractual employees who can
never acquire regular employment status, unlike local workers who are or can
become regular employees. Hence, the OSG
posits that there are rights and privileges exclusive to local workers, but not
available to OFWs; that these peculiarities make for a reasonable and valid
basis for the differentiated treatment under the subject clause of the money
claims of OFWs who are illegally dismissed.
Thus, the provision does not violate the equal protection clause nor
Section 18, Article II of the Constitution.[45]
Lastly,
the OSG defends the rationale behind the subject clause as a police power
measure adopted to mitigate the solidary liability of placement agencies for
this “redounds to the benefit of the
migrant workers whose welfare the government seeks to promote. The survival of legitimate placement agencies
helps [assure] the government that migrant workers are properly deployed and
are employed under decent and humane conditions.”[46]
The
Court's Ruling
The
Court sustains petitioner on the first and second issues.
When
the Court is called upon to exercise its power of judicial review of the
acts of its co-equals, such as the Congress, it does so only when these
conditions obtain: (1) that there is an actual case or controversy involving a
conflict of rights susceptible of judicial determination;[47] (2)
that the constitutional question is raised by a proper party[48] and at
the earliest opportunity;[49] and
(3) that the constitutional question is the very lis mota of the case,[50] otherwise the
Court will dismiss the case or decide
the same on some other ground.[51]
Without a doubt, there exists in this case an
actual controversy directly involving petitioner who is personally aggrieved
that the labor tribunals and the CA computed his monetary award based on the
salary period of three months only as provided under the subject clause.
The
constitutional challenge is also timely. It should be borne in mind that the
requirement that a constitutional issue be raised at the earliest opportunity
entails the interposition of the issue in the pleadings before a competent
court, such that, if the issue is not raised in the pleadings before
that competent court, it cannot be considered at the trial and, if not
considered in the trial, it cannot be considered on appeal.[52] Records disclose that the issue on the
constitutionality of the subject clause was first raised, not in petitioner's
appeal with the NLRC, but in his Motion for Partial Reconsideration with said
labor tribunal,[53]
and reiterated in his Petition for Certiorari before the CA.[54] Nonetheless, the issue is deemed seasonably
raised because it is not the NLRC but the CA which has the competence to
resolve the constitutional issue. The
NLRC is a labor tribunal that merely performs a quasi-judicial function – its
function in the present case is limited to determining questions of
fact to which the legislative policy of R.A. No. 8042 is to be applied and to
resolving such questions in accordance with the standards laid down by the law
itself;[55] thus, its
foremost function is to administer and enforce R.A. No. 8042, and not to
inquire into the validity of its provisions.
The CA, on the other hand, is vested with the power of judicial review
or the power to declare unconstitutional a law or a provision thereof, such as
the subject clause.[56] Petitioner's interposition of the
constitutional issue before the CA was undoubtedly seasonable. The CA was therefore remiss in failing to
take up the issue in its decision.
The
third condition that the constitutional issue be critical to the resolution of
the case likewise obtains because the monetary claim of petitioner to his
lump-sum salary for the entire unexpired portion of his 12-month employment
contract, and not just for a period of three months, strikes at the very core
of the subject clause.
Thus,
the stage is all set for the determination of the constitutionality of the
subject clause.
Does the subject clause violate Section 10,
Article III of
the Constitution on non-impairment
of contracts?
The
answer is in the negative.
Petitioner's
claim that the subject clause unduly interferes with the stipulations in his
contract on the term of his employment and the fixed salary package he will
receive[57]
is not tenable.
Section 10,
Article III of the Constitution provides:
No law impairing the obligation of contracts shall be passed.
The prohibition
is aligned with the general principle that laws newly enacted have only a
prospective operation,[58]
and cannot affect acts or contracts already perfected;[59]
however, as to laws already in existence, their provisions are read into
contracts and deemed a part thereof.[60] Thus, the non-impairment clause under Section
10, Article II is limited in application to laws about to be enacted that would
in any way derogate from existing acts or contracts by enlarging, abridging or
in any manner changing the intention of the parties thereto.
As aptly observed by the OSG, the enactment of R.A.
No. 8042 in 1995 preceded the execution of the employment contract between
petitioner and respondents in 1998.
Hence, it cannot be argued that R.A. No. 8042, particularly the subject
clause, impaired the employment contract of the parties. Rather, when the parties executed their 1998
employment contract, they were deemed to have incorporated into it all the
provisions of R.A. No. 8042.
But even if the
Court were to disregard the timeline, the subject clause may not be declared
unconstitutional on the ground that it impinges on the impairment clause, for
the law was enacted in the exercise of the police power of the State to
regulate a business, profession or calling, particularly the recruitment and
deployment of OFWs, with the noble end in view of ensuring respect for the dignity
and well-being of OFWs wherever they may be employed.[61]
Police power legislations adopted by the State to promote the health, morals,
peace, education, good order, safety, and general welfare of the people are
generally applicable not only to future contracts but even to those already in
existence, for all private contracts must yield to the superior and legitimate
measures taken by the State to promote public welfare.[62]
Does the subject clause violate Section 1,
Article III of the Constitution, and Section 18,
Article II and Section 3, Article XIII on labor
as a protected sector?
The answer is in
the affirmative.
Section 1,
Article III of the Constitution guarantees:
No person shall be deprived of life, liberty, or
property without due process of law nor shall any person be denied the equal
protection of the law.
Section 18,[63]
Article II and Section 3,[64]
Article XIII accord all members of the labor sector, without distinction
as to place of deployment, full protection of their rights and welfare.
To Filipino workers, the rights guaranteed under the foregoing
constitutional provisions translate to economic security and parity: all
monetary benefits should be equally enjoyed by workers of similar category,
while all monetary obligations should be borne by them in equal degree; none
should be denied the protection of the laws which is enjoyed by, or spared the
burden imposed on, others in like circumstances.[65]
Such rights are not absolute but subject to the
inherent power of Congress to incorporate, when it sees fit, a system of
classification into its legislation; however, to be valid, the classification
must comply with these requirements: 1) it is based on substantial distinctions;
2) it is germane to the purposes of the law; 3) it is not limited to existing
conditions only; and 4) it applies equally to all members of the class.[66]
There are three levels of scrutiny at which the
Court reviews the constitutionality of a classification embodied in a law: a)
the deferential or rational basis scrutiny in which the challenged
classification needs only be shown to be rationally related to serving a
legitimate state interest;[67]
b) the middle-tier or intermediate scrutiny in which
the government
must show that the challenged classification serves an important state interest and that the
classification is at least substantially related to serving that interest;[68]
and c) strict judicial scrutiny[69]
in which a legislative
classification which impermissibly interferes with the exercise of a
fundamental right[70] or
operates to the peculiar disadvantage of a suspect class[71] is
presumed unconstitutional, and the
burden is upon the government to prove
that the classification is necessary to achieve a compelling state
interest and that it is the least restrictive means to
protect such interest.[72]
Under
American jurisprudence, strict judicial scrutiny is triggered by suspect classifications[73] based on race[74] or gender[75] but not when the classification is drawn along income
categories.[76]
It is different
in the Philippine setting. In Central Bank (now Bangko Sentral ng
Pilipinas) Employee Association, Inc. v. Bangko Sentral ng Pilipinas,[77] the constitutionality of a provision in
the charter of the Bangko Sentral ng Pilipinas (BSP), a government
financial institution (GFI), was challenged for maintaining its rank-and-file
employees under the Salary Standardization Law (SSL), even when the
rank-and-file employees of other GFIs had been exempted from the SSL by their
respective charters. Finding that the
disputed provision contained a suspect classification based on salary grade,
the Court deliberately employed the standard of strict judicial scrutiny in its
review of the constitutionality of said provision. More significantly, it was in this case that
the Court revealed the broad outlines of its judicial philosophy, to wit:
Congress retains its wide discretion in providing for a valid
classification, and its policies should be accorded recognition and respect by
the courts of justice except when they run afoul of the Constitution. The deference stops where the
classification violates a fundamental right, or prejudices persons accorded special protection by the Constitution. When these violations arise, this
Court must discharge its primary role as the vanguard of constitutional
guaranties, and require a stricter and
more exacting adherence to constitutional limitations. Rational basis
should not suffice.
Admittedly, the view that prejudice to persons accorded special
protection by the Constitution requires a stricter judicial scrutiny finds no
support in American or English jurisprudence. Nevertheless, these foreign
decisions and authorities are not per
se controlling in this jurisdiction. At best, they are persuasive and have been used to support many of our
decisions. We should not place undue and fawning reliance upon them and regard
them as indispensable mental crutches without which we cannot come to our own
decisions through the employment of our own endowments. We live in a
different ambience and must decide our own problems in the light of our own
interests and needs, and of our qualities and even idiosyncrasies as a people,
and always with our own concept of law and justice. Our laws must be construed
in accordance with the intention of our own lawmakers and such intent may be
deduced from the language of each law and the context of other local
legislation related thereto. More importantly, they must be construed to serve
our own public interest which is the be-all and the end-all of all our
laws. And it need not be stressed that our public interest is distinct
and different from others.
x x x x
Further, the quest for a better and more “equal” world calls for the use
of equal protection as a tool of effective judicial intervention.
Equality is one ideal which cries out for bold attention and action in
the Constitution. The Preamble proclaims “equality” as an ideal precisely
in protest against crushing inequities in Philippine society. The command
to promote social justice in Article II, Section 10, in “all phases of national
development,” further explicitated in Article XIII, are clear commands to the
State to take affirmative action in the direction of greater equality. x x
x [T]here is thus in the Philippine
Constitution no lack of doctrinal support for a more vigorous state effort
towards achieving a reasonable measure of equality.
Our present Constitution has gone further in guaranteeing vital social
and economic rights to marginalized groups of society, including labor. 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
privilege in life should have more in law. And the obligation to afford
protection to labor is incumbent not only on the legislative and executive
branches but also on the judiciary to translate this pledge into a living
reality. Social justice calls for the humanization of laws and the equalization
of social and economic forces by the State so that justice in its rational and
objectively secular conception may at least be approximated.
x x x x
Under
most circumstances, the Court will exercise judicial restraint in deciding
questions of constitutionality, recognizing the broad discretion given to
Congress in exercising its legislative power. Judicial scrutiny would be
based on the “rational basis” test, and the legislative discretion would be
given deferential treatment.
But if the challenge to the statute is premised on the
denial of a fundamental right, or the
perpetuation of prejudice against persons favored by the Constitution with
special protection, judicial scrutiny ought to be more strict. A
weak and watered down view would call for the abdication of this Court’s solemn
duty to strike down any law repugnant to the Constitution and the rights it
enshrines. This is true whether the actor committing the unconstitutional
act is a private person or the government itself or one of its
instrumentalities. Oppressive acts will be struck down regardless of the
character or nature of the actor.
x x x x
In the case at bar, the challenged proviso operates on the basis of the salary grade or
officer-employee status. It is
akin to a distinction based on economic class and status, with the higher
grades as recipients of a benefit specifically withheld from the lower grades.
Officers of the BSP now receive higher compensation packages that are
competitive with the industry, while the poorer, low-salaried employees are
limited to the rates prescribed by the SSL. The implications are quite
disturbing: BSP rank-and-file employees are paid the strictly regimented rates
of the SSL while employees higher in rank - possessing higher and better
education and opportunities for career advancement - are given higher
compensation packages to entice them to stay. Considering that majority, if not
all, the rank-and-file employees consist of people whose status and rank in
life are less and limited, especially in terms of job marketability, it is they
- and not the officers - who have the real economic and financial need for the
adjustment . This is in accord with the policy of the Constitution
"to free the people from poverty, provide adequate social services, extend
to them a decent standard of living, and improve the quality of life for all.” Any
act of Congress that runs counter to this constitutional desideratum deserves
strict scrutiny by this Court before it can pass muster. (Emphasis supplied)
Imbued
with the same sense of “obligation to afford protection to labor,” the Court in the
present case also employs the standard of strict judicial scrutiny, for it
perceives in the subject clause a suspect classification prejudicial to OFWs.
Upon cursory
reading, the subject clause appears facially neutral, for it applies to all
OFWs. However, a closer examination
reveals that the subject clause has a discriminatory intent against, and an
invidious impact on, OFWs at two levels:
First, OFWs with
employment contracts of less than one year vis-à-vis OFWs with
employment contracts of one year or more;
Second, among OFWs with employment contracts of
more than one year; and
Third, OFWs vis-à-vis
local workers with fixed-period employment;
OFWs with employment contracts of less than one year vis-à-vis
OFWs with employment contracts of one year or more
As pointed out by petitioner,[78]
it was in Marsaman Manning Agency, Inc. v. National Labor Relations
Commission[79] (Second
Division, 1999) that the Court laid down the following rules on the application
of the periods prescribed under Section 10(5) of R.A. No. 804, to wit:
A
plain reading of Sec. 10 clearly reveals that the choice of which amount to
award an illegally dismissed overseas contract worker, i.e., whether his
salaries for the unexpired portion of his employment contract or three (3)
months’ salary for every year of the unexpired term, whichever is less, comes
into play only when the employment contract concerned has a term of at least
one (1) year or more. This
is evident from the words “for every year of the unexpired term” which follows
the words “salaries x x x for three months.” To follow petitioners’
thinking that private respondent is entitled to three (3) months salary only
simply because it is the lesser amount is to completely disregard and overlook
some words used in the statute while giving effect to some. This is contrary to
the well-established rule in legal hermeneutics that in interpreting a statute,
care should be taken that every part or word thereof be given effect since the
law-making body is presumed to know the meaning of the words employed in the
statue and to have used them advisedly. Ut res magis valeat quam pereat.[80] (Emphasis supplied)
In Marsaman,
the OFW involved was illegally dismissed two months into his 10-month contract,
but was awarded his salaries for the remaining 8 months and 6 days of his
contract.
Prior to Marsaman,
however, there were two cases in which the Court made conflicting rulings on
Section 10(5). One was Asian Center
for Career and Employment System and Services v. National Labor Relations
Commission (Second Division,
October 1998),[81] which
involved an OFW who was awarded a two-year
employment contract, but was dismissed after working for one year and two
months. The LA declared his dismissal
illegal and awarded him SR13,600.00 as lump-sum salary covering eight months, the unexpired portion of his contract. On appeal, the Court reduced the award to
SR3,600.00 equivalent to his three months’ salary, this being the lesser value,
to wit:
Under Section 10 of R.A. No. 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 respondent’s 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.[82]
Another
was Triple-Eight Integrated Services, Inc. v. National Labor Relations
Commission (Third Division, December 1998),[83] which
involved an OFW (therein respondent Erlinda Osdana) who was originally granted
a 12-month contract, which was deemed renewed for another 12 months. After serving for one year and seven-and-a-half
months, respondent Osdana was illegally dismissed, and the Court awarded her
salaries for the entire unexpired portion of four and one-half months of her
contract.
The Marsaman interpretation of Section
10(5) has since been adopted in the following cases:
|
Case Title |
Contract Period |
Period of Service |
Unexpired Period |
Period Applied in the Computation
of the Monetary Award |
|
Skippers v. Maguad[84] |
6 months |
2 months |
4 months |
4 months |
|
|
9 months |
8 months |
4 months |
4 months |
|
Centennial Transmarine v. dela Cruz
l[86] |
9
months |
4 months |
5 months |
5 months |
|
Talidano v. Falcon[87] |
12 months |
3 months |
9 months |
3 months |
|
Univan v. CA [88] |
12 months |
3 months |
9 months |
3 months |
|
Oriental v. CA [89] |
12 months |
more than 2 months |
10 months |
3 months |
|
PCL v. NLRC[90] |
12 months |
more than 2 months |
more or less 9 months |
3 months |
|
Olarte v. Nayona[91] |
12 months |
21 days |
11 months and 9 days |
3 months |
|
JSS v. Ferrer[92] |
12 months |
16 days |
11 months and 24 days |
3 months |
|
Pentagon v.
Adelantar[93] |
12 months |
9 months and 7 days |
2 months and 23 days |
2 months and 23 days |
|
Phil.
Employ v. Paramio, et al.[94] |
12 months |
10 months |
2 months |
Unexpired portion |
|
Flourish Maritime v. Almanzor [95] |
2 years |
26 days |
23 months and 4 days |
6 months or 3 months for each
year of contract |
|
Athenna Manpower v. Villanos [96] |
1 year, 10 months and 28 days |
1 month |
1 year, 9 months and 28 days |
6 months or 3 months for each
year of contract |
As the foregoing matrix readily shows, the subject
clause classifies OFWs into two categories.
The first category includes OFWs with fixed-period employment contracts
of less than one year; in case of illegal dismissal, they are entitled to their
salaries for the entire unexpired portion of their contract. The second category consists of OFWs with
fixed-period employment contracts of one year or more; in case of illegal
dismissal, they are entitled to monetary award
equivalent to only 3 months of the unexpired portion of their contracts.
The disparity in the treatment of these two groups
cannot be discounted. In Skippers,
the respondent OFW worked for only 2 months out of his 6-month contract, but
was awarded his salaries for the remaining 4 months. In contrast, the respondent OFWs in Oriental and PCL
who had also worked for about 2 months
out of their 12-month contracts were awarded their salaries for only 3 months
of the unexpired portion of their contracts.
Even the OFWs involved in Talidano and Univan who
had worked for a longer period of 3 months out of their 12-month
contracts before being illegally dismissed were awarded their salaries for only
3 months.
To illustrate the disparity even more vividly, the
Court assumes a hypothetical OFW-A with an employment contract of 10 months at
a monthly salary rate of US$1,000.00 and a hypothetical OFW-B with an
employment contract of 15 months with the same monthly salary rate of
US$1,000.00. Both commenced work on the
same day and under the same employer, and were illegally dismissed after one
month of work. Under the subject clause,
OFW-A will be entitled to US$9,000.00, equivalent to his salaries for the
remaining 9 months of his contract, whereas OFW-B will be entitled to only
US$3,000.00, equivalent to his salaries for 3 months of the unexpired portion
of his contract, instead of US$14,000.00 for the unexpired portion of 14 months
of his contract, as the US$3,000.00 is the lesser amount.
The disparity becomes more aggravating when the
Court takes into account jurisprudence that, prior to the effectivity of R.A. No. 8042 on July 14,
1995,[97] illegally
dismissed OFWs, no matter how long the period of their employment contracts,
were entitled to their salaries for the entire unexpired portions of their
contracts. The matrix below speaks for
itself:
|
Case Title |
Contract Period |
Period of Service |
Unexpired Period |
Period Applied in the Computation of the
Monetary Award |
|
ATCI v.
CA, et al.[98] |
2 years |
2 months |
22 months |
22 months |
|
Phil. Integrated v. NLRC[99] |
2 years |
7 days |
23 months and 23 days |
23 months and 23 days |
|
JGB v. NLC[100] |
2 years |
9 months |
15 months |
15 months |
|
Agoy v. NLRC[101] |
2 years |
2 months |
22 months |
22 months |
|
EDI v.
NLRC, et al.[102] |
2 years |
5 months |
19 months |
19 months |
|
Barros
v. NLRC, et al.[103] |
12 months |
4 months |
8 months |
8 months |
|
Philippine Transmarine v.
Carilla[104] |
12 months |
6 months and 22 days |
5 months and 18 days |
5 months and 18 days |
It is plain that
prior to R.A. No. 8042, all OFWs,
regardless of contract periods or the unexpired portions thereof, were treated
alike in terms of the computation of their monetary benefits in case of illegal
dismissal. Their claims were subjected
to a uniform rule of computation: their basic salaries multiplied by the entire
unexpired portion of their employment contracts.
The enactment of
the subject clause in R.A. No. 8042 introduced a
differentiated rule of computation of the money claims of illegally dismissed
OFWs based on their employment periods, in the process singling out
one category whose contracts have an
unexpired portion of one year or more and subjecting them to the peculiar
disadvantage of having their monetary awards limited to their salaries for 3
months or for the unexpired portion thereof, whichever is less, but all the
while sparing the other category from such prejudice, simply because the
latter's unexpired contracts fall short
of one year.
Among
OFWs With Employment
Contracts
of More Than One Year
Upon closer examination of the terminology employed in the subject
clause, the Court now has misgivings on the accuracy of the Marsaman
interpretation.
The Court notes that the subject clause
“or
for three (3) months for every year of the unexpired term, whichever
is less” contains the qualifying phrases “every year” and “unexpired
term.” By its ordinary meaning, the word
“term” means a limited or definite extent of time.[105] Corollarily, that “every year” is but part of
an “unexpired term” is significant in many ways: first,
the unexpired term must be at
least one year, for if it were any
shorter, there would
be no occasion for such unexpired
term to
be measured by every year;
and second, the original term must be
more than one year, for otherwise, whatever would be the unexpired term thereof
will not reach even a year.
Consequently, the more decisive factor in the determination of when the
subject clause “for three (3) months for every year of the unexpired term,
whichever is less” shall apply is not the length of the original
contract period as held in Marsaman,[106] but
the length of the unexpired portion of the contract period -- the subject
clause applies in cases when the unexpired portion of the contract period is at
least one year, which arithmetically requires that the original contract period
be more than one year.
Viewed
in that light, the subject clause creates a sub-layer of discrimination among
OFWs whose contract periods are for more than one year: those who are illegally dismissed with less
than one year left in their contracts shall be entitled to their salaries for
the entire unexpired portion thereof, while those who are illegally dismissed
with one year or more remaining in their contracts shall be covered by the
subject clause, and their monetary benefits limited to their salaries for three
months only.
To
concretely illustrate the application of the foregoing interpretation of the
subject clause, the Court assumes hypothetical OFW-C and OFW-D, who each have a
24-month contract at a salary rate of US$1,000.00 per month. OFW-C is illegally dismissed on the 12th
month, and OFW-D, on the 13th month.
Considering that there is at least 12 months remaining in the contract
period of OFW-C, the subject clause applies to the computation of the latter's
monetary benefits. Thus, OFW-C will be
entitled, not to US$12,000,00 or the latter's total salaries for the 12 months
unexpired portion of the contract, but
to the lesser amount of US$3,000.00 or the latter's salaries for 3 months out
of the 12-month unexpired term of the contract.
On the other hand, OFW-D is spared from the effects of the subject
clause, for there are only 11 months left in the latter's contract period. Thus, OFW-D will be entitled to US$11,000.00,
which is equivalent to his/her total salaries for the entire 11-month unexpired
portion.
OFWs
vis-à-vis Local Workers
With
Fixed-Period Employment
As
discussed earlier, prior to R.A. No. 8042, a uniform system of computation of
the monetary awards of illegally dismissed OFWs was in place. This uniform system was applicable even to
local workers with fixed-term employment.[107]
The
earliest rule prescribing a uniform system of computation was actually Article
299 of the Code of Commerce (1888),[108] to
wit:
Article
299. If the contracts between the
merchants and their shop clerks and employees should have been made of a fixed
period, none of the contracting parties, without the consent of the other, may
withdraw from the fulfillment of said contract until the termination of the
period agreed upon.
Persons
violating this clause shall be subject to indemnify the loss and damage
suffered, with the exception of the provisions contained in the following
articles.
In Reyes v. The Compañia Maritima,[109] the
Court applied the foregoing provision to determine the liability of a shipping
company for the illegal discharge of its managers prior to the expiration of
their fixed-term employment. The Court
therein held the shipping company liable for the salaries of its managers for
the remainder of their fixed-term employment.
There
is a more specific rule as far as seafarers are concerned: Article 605 of the Code of Commerce which
provides:
Article
605. If the contracts of the captain and
members of the crew with the agent should be for a definite period or voyage,
they cannot be discharged until the fulfillment of their contracts, except for
reasons of insubordination in serious matters, robbery, theft, habitual
drunkenness, and damage caused to the vessel or to its cargo by malice or
manifest or proven negligence.
Article 605 was applied to Madrigal Shipping Company, Inc. v. Ogilvie,[110] in
which the Court held the shipping company liable
for the salaries and subsistence allowance of its illegally dismissed employees
for the entire unexpired portion of their employment contracts.
While
Article 605 has remained good law up to the present,[111]
Article 299 of the Code of Commerce was replaced by Art. 1586 of the Civil Code
of 1889, to wit:
Article
1586. Field hands, mechanics, artisans, and
other laborers hired for a certain time and for a certain work cannot
leave or be dismissed without sufficient cause, before the fulfillment of the
contract. (Emphasis supplied.)
Citing
The
doctrine is well-established in American jurisprudence, and nothing has been
brought to our attention to the contrary under Spanish jurisprudence, that when
an employee is wrongfully discharged it is his duty to seek other employment of
the same kind in the same community, for the purpose of reducing the damages
resulting from such wrongful discharge. However, while this is the general
rule, the burden of showing that he failed to make an effort to secure other
employment of a like nature, and that other employment of a like nature was
obtainable, is upon the defendant. When
an employee is wrongfully discharged under a contract of employment his prima
facie damage is the amount which he would be entitled to had he continued in
such employment until the termination of the period. (Howard vs. Daly,
61 N. Y., 362; Allen vs. Whitlark, 99
On
More significantly, the same principles were applied to cases involving
overseas Filipino workers whose fixed-term employment contracts were illegally
terminated, such as in First Asian Trans & Shipping Agency,
Inc. v. Ople,[119] involving seafarers who were illegally
discharged. In Teknika Skills and Trade Services, Inc. v. National Labor Relations
Commission,[120] an
OFW who was illegally dismissed prior to the expiration of her fixed-period
employment contract as a baby sitter, was awarded salaries corresponding to the unexpired portion of her contract. The Court arrived at the same ruling in Anderson v. National Labor Relations
Commission,[121] which involved a foreman hired in 1988
in Saudi Arabia for a fixed term of two years, but who was illegally dismissed
after only nine months on the job -- the Court awarded him salaries
corresponding to 15 months, the unexpired portion of his contract. In Asia
World Recruitment, Inc. v. National Labor Relations Commission,[122]
a Filipino working as a security officer in 1989 in
In sum, prior to R.A. No.
8042, OFWs and local workers with fixed-term employment who were illegally
discharged were treated alike in terms of the computation of their money
claims: they were uniformly entitled to their salaries for the entire unexpired
portions of their contracts. But with the
enactment of R.A. No. 8042, specifically the adoption of the subject clause,
illegally dismissed OFWs with an unexpired portion of one year or more in their
employment contract have since been differently treated in that their money
claims are subject to a 3-month cap, whereas no such limitation is imposed on
local workers with fixed-term employment.
The Court concludes that the subject
clause contains a suspect classification in that, in the computation of the
monetary benefits of fixed-term employees who are illegally discharged, it
imposes a 3-month cap on the claim of OFWs with an unexpired portion of one
year or more in their contracts, but none on the claims of other OFWs or local
workers with fixed-term employment. The
subject clause singles out one classification of OFWs and burdens it with a
peculiar disadvantage.
There being a
suspect classification involving a vulnerable sector protected by the
Constitution, the Court now subjects the classification to a strict judicial
scrutiny, and determines whether it serves a compelling state interest through
the least restrictive means.
What constitutes
compelling state interest is measured by the scale of rights and powers arrayed
in the Constitution and calibrated by history.[124] It is akin to the paramount interest of the
state[125]
for which some individual liberties must give way, such as the public interest
in safeguarding health or maintaining medical standards,[126]
or in maintaining access to information on matters of public concern.[127]
In the present
case, the Court dug deep into the records but found no compelling state
interest that the subject clause may possibly serve.
The OSG defends the subject clause as a police power
measure “designed to protect the employment of Filipino seafarers overseas x x
x. By limiting the liability to three
months [sic], Filipino seafarers have better chance of getting hired by foreign
employers.” The limitation also protects
the interest of local placement agencies, which otherwise may be made to
shoulder millions of pesos in “termination pay.”[128]
The OSG explained further:
Often,
placement agencies, their liability being solidary, shoulder the payment of
money claims in the event that jurisdiction over the foreign employer is not
acquired by the court or if the foreign employer reneges on its obligation.
Hence, placement agencies that are in good faith and which fulfill their
obligations are unnecessarily penalized for the acts of the foreign employer. To
protect them and to promote their continued helpful contribution in deploying
Filipino migrant workers, liability for money are reduced under Section
10 of RA 8042.
This measure redounds to the
benefit of the migrant workers whose welfare the government seeks to promote.
The survival of legitimate placement agencies helps [assure] the government
that migrant workers are properly deployed and are employed under decent and
humane conditions.[129] (Emphasis supplied)
However,
nowhere in the Comment or Memorandum does the OSG cite the source of its
perception of the state interest sought to be served by the subject clause.
The OSG locates the purpose of R.A. No. 8042 in the
speech of Rep. Bonifacio Gallego in sponsorship of House Bill No. 14314 (HB
14314), from which the law originated;[130]
but the speech makes no reference to the underlying reason for the adoption of
the subject clause. That is only natural
for none of the 29 provisions in HB 14314 resembles the subject clause.
On
the other hand, Senate Bill No. 2077 (SB 2077) contains a provision on money
claims, to wit:
Sec. 10. Money
Claims. - Notwithstanding any provision of law to the contrary, the Labor
Arbiters of the National Labor Relations Commission (NLRC) shall have the
original and exclusive jurisdiction to hear and decide, within ninety (90)
calendar days after the filing of the complaint, the claims arising out of an
employer-employee relationship or by virtue of the complaint, the claim arising
out of an employer-employee relationship or by virtue of any law or contract
involving Filipino workers for overseas employment including claims for actual,
moral, exemplary and other forms of damages.
The liability
of the principal and the recruitment/placement agency or any and all claims
under this Section shall be joint and several.
Any
compromise/amicable settlement or voluntary agreement on any money claims
exclusive of damages under this Section shall not be less than fifty percent
(50%) of such money claims: Provided, That any installment payments, if
applicable, to satisfy any such compromise or voluntary settlement shall not be
more than two (2) months. Any compromise/voluntary agreement in violation of
this paragraph shall be null and void.
Non-compliance
with the mandatory period for resolutions of cases provided under this Section
shall subject the responsible officials to any or all of the following
penalties:
(1)
The salary of any such official who fails to render his decision or
resolution within the prescribed period shall be, or caused to be, withheld
until the said official complies therewith;
(2)
Suspension for not more than ninety (90) days; or
(3) Dismissal from the service with
disqualification to hold any appointive public office for five (5) years.
Provided,
however, That the penalties herein provided shall be without prejudice to any
liability which any such official may have incurred under other existing laws
or rules and regulations as a consequence of violating the provisions of this
paragraph.
But significantly,
Section 10 of SB 2077 does not provide for any rule on the computation of money
claims.
A
rule on the computation of money claims containing the subject clause was
inserted and eventually adopted as the 5th paragraph of Section 10
of R.A. No. 8042. The Court examined the
rationale of the subject clause in the transcripts of the “Bicameral Conference
Committee (Conference Committee) Meetings on the Magna Carta on OCWs
(Disagreeing Provisions of Senate Bill No. 2077 and House Bill No.
14314).” However, the Court finds no
discernible state interest, let alone a compelling one, that is sought to be
protected or advanced by the adoption of the subject clause.
In
fine, the Government has failed to discharge its burden of proving the
existence of a compelling state interest that would justify the perpetuation of
the discrimination against OFWs under the subject clause.
Assuming
that, as advanced by the OSG, the purpose of the subject clause is to protect
the employment of OFWs by mitigating the solidary liability of placement
agencies, such callous and cavalier rationale will have to be rejected. There can never be a justification for any
form of government action that alleviates the burden of one sector, but imposes
the same burden on another sector, especially when the favored sector is
composed of private businesses such as placement agencies, while the
disadvantaged sector is composed of OFWs whose protection no less than the Constitution commands. The idea that private business interest can
be elevated to the level of a compelling state interest is odious.
Moreover, even if the purpose of the subject clause is to
lessen the solidary liability of placement agencies vis-a-vis their
foreign principals, there are mechanisms already in place that can be employed
to achieve that purpose without infringing on the constitutional rights of
OFWs.
The POEA
Rules and Regulations Governing the Recruitment and Employment of Land-Based
Overseas Workers, dated February 4, 2002, imposes administrative disciplinary measures
on erring foreign employers who default on their contractual obligations to
migrant workers and/or their Philippine agents. These disciplinary measures
range from temporary disqualification to preventive suspension. The POEA Rules and Regulations Governing
the Recruitment and Employment of Seafarers, dated
Resort to these administrative measures is
undoubtedly the less restrictive means of aiding local placement agencies in
enforcing the solidary liability of their foreign principals.
Thus, the subject clause in the 5th
paragraph of Section 10 of R.A. No. 8042 is violative of the right of
petitioner and other OFWs to equal protection.
Further, there would be
certain misgivings if one is to approach the declaration of the
unconstitutionality of the subject clause from the lone perspective that the
clause directly violates state policy on labor under Section 3,[131]
Article XIII of the Constitution.
While all the
provisions of the 1987 Constitution are presumed self-executing,,[132]
there are some which this Court has declared not judicially enforceable,
Article XIII being one,[133] particularly
Section 3 thereof, the nature of which, this Court, in Agabon
v. National Labor Relations Commission,[134]
has described to be not self-actuating:
Thus, the constitutional
mandates of protection to labor and security of tenure may be deemed as
self-executing in the sense that these are automatically acknowledged and
observed without need for any enabling legislation. However, to declare that
the constitutional provisions are enough to guarantee the full exercise of the
rights embodied therein, and the realization of ideals therein expressed, would
be impractical, if not unrealistic. The espousal of such view presents the
dangerous tendency of being overbroad and exaggerated. The guarantees of
"full protection to labor" and "security of tenure", when
examined in isolation, are facially unqualified, and the broadest interpretation
possible suggests a blanket shield in favor of labor against any form of
removal regardless of circumstance. This interpretation implies an
unimpeachable right to continued employment-a utopian notion, doubtless-but
still hardly within the contemplation of the framers. Subsequent legislation is
still needed to define the parameters of these guaranteed rights to ensure the
protection and promotion, not only the rights of the labor sector, but of the
employers' as well. Without specific and pertinent legislation, judicial bodies
will be at a loss, formulating their own conclusion to approximate at least the
aims of the Constitution.
Ultimately,
therefore, Section 3 of Article XIII cannot, on its own, be a source of a
positive enforceable right to
stave off the dismissal of an employee for just cause owing to the failure to
serve proper notice or hearing. As manifested by several framers of the 1987
Constitution, the provisions on social justice require legislative enactments
for their enforceability.[135] (Emphasis added)
Thus, Section 3, Article XIII cannot be treated as a
principal source of direct enforceable rights, for the violation of which the
questioned clause may be declared unconstitutional. It may unwittingly risk opening the floodgates
of litigation to every worker or union over every conceivable violation of so
broad a concept as social justice for labor.
It must be stressed that Section 3, Article XIII
does not directly bestow on the working class any actual enforceable right, but
merely clothes it with the status of a sector for whom the Constitution urges
protection through executive or legislative action and judicial
recognition. Its utility is best
limited to being an impetus not just for the executive and legislative departments,
but for the judiciary as well, to protect the welfare of the working class.
And it was in fact consistent with
that constitutional agenda that the
Court in Central Bank (now Bangko Sentral ng Pilipinas) Employee
Association, Inc. v. Bangko Sentral ng Pilipinas, penned by then Associate
Justice now Chief Justice Reynato S. Puno,
formulated the judicial precept that when the challenge to a statute is
premised on the perpetuation of prejudice against persons favored by the Constitution
with special protection -- such as the working class or a section thereof -- the Court may recognize the existence of a
suspect classification and subject the same to strict judicial scrutiny.
The view that the concepts of suspect classification
and strict judicial scrutiny formulated in Central Bank Employee Association
exaggerate the significance of Section 3, Article XIII is a groundless
apprehension. Central Bank
applied Article XIII in conjunction with the equal protection clause. Article XIII, by itself, without the
application of the equal protection clause, has no life or force of its own as
elucidated in Agabon.
Along the same line of reasoning, the Court further holds that the
subject clause violates petitioner's right to substantive due process, for it
deprives him of property, consisting of monetary benefits, without any existing
valid governmental purpose.[136]
The argument of the Solicitor General, that the actual purpose of the
subject clause of limiting the entitlement of OFWs to their three-month salary
in case of illegal dismissal, is to give them a better chance of getting hired
by foreign employers. This is plain
speculation. As earlier discussed, there
is nothing in the text of the law or the records of the deliberations leading
to its enactment or the pleadings of respondent that would indicate that there
is an existing governmental purpose for the subject clause, or even just a
pretext of one.
The subject clause does not state or imply any definitive governmental
purpose; and it is for that precise reason that the clause violates not just
petitioner's right to equal protection, but also her right to substantive due
process under Section 1,[137] Article III of the Constitution.
The subject clause being unconstitutional, petitioner is entitled to his
salaries for the entire unexpired period of nine months and 23 days of his
employment contract, pursuant to law and jurisprudence prior to the enactment
of R.A. No. 8042.
On the Third Issue
Petitioner contends
that his overtime and leave pay should form part of the salary basis in the
computation of his monetary award, because these are fixed benefits that have
been stipulated into his contract.
Petitioner is
mistaken.
The word salaries in Section 10(5)
does not include overtime and leave pay.
For seafarers like petitioner, DOLE Department Order No. 33, series
1996, provides a Standard Employment Contract of Seafarers, in which salary is
understood as the basic wage, exclusive of overtime, leave pay and other
bonuses; whereas overtime pay is compensation for all work “performed” in
excess of the regular eight hours, and holiday pay is compensation for
any work “performed” on designated rest days and holidays.
By the foregoing definition alone, there is no
basis for the automatic inclusion of overtime and holiday pay in the
computation of petitioner's monetary award, unless there is evidence that he
performed work during those periods. As
the Court held in Centennial Transmarine, Inc. v. Dela Cruz,[138]
However, the payment of
overtime pay and leave pay should be disallowed in light of our ruling in
Cagampan v. National Labor Relations Commission, to wit:
The rendition of overtime work and the submission of sufficient proof
that said was actually performed are conditions to be satisfied before a seaman
could be entitled to overtime pay which should be computed on the basis of 30%
of the basic monthly salary. In short, the contract provision guarantees the
right to overtime pay but the entitlement to such benefit must first be
established.
In the same vein, the claim
for the day's leave pay for the unexpired portion of the contract is
unwarranted since the same is given during the actual service of the seamen.
WHEREFORE, the Court GRANTS the Petition. The subject clause “or for
three months for every year of the unexpired term, whichever is less” in the 5th
paragraph of Section 10 of Republic Act No. 8042 is DECLARED UNCONSTITUTIONAL;
and the December 8, 2004 Decision and April 1, 2005 Resolution of the Court of
Appeals are MODIFIED to the effect that petitioner is AWARDED his
salaries for the entire unexpired portion of his employment contract consisting
of nine months and 23 days computed at the rate of US$1,400.00 per month.
No costs.
SO ORDERED.
MA. ALICIA AUSTRIA-MARTINEZ
Associate Justice
WE
CONCUR:
REYNATO S. PUNO
Chief Justice
|
LEONARDO A. QUISUMBING Associate Justice |
CONSUELO
YNARES-SANTIAGO Associate Justice |
|
ANTONIO T. CARPIO Associate Justice |
RENATO C. CORONA Associate Justice |
|
CONCHITA CARPIO MORALES Associate Justice |
DANTE O. TINGA Associate Justice |
|
(On leave) MINITA V. CHICO-NAZARIO Associate Justice |
PRESBITERO J. VELASCO, JR. Associate Justice |
|
ANTONIO EDUARDO B. NACHURA Associate Justice |
TERESITA J. LEONARDO- DE CASTRO Associate Justice |
|
(see concurring opinion) ARTURO D. BRION Associate Justice |
DIOSDADO M. PERALTA Associate Justice |
Pursuant to Section 13, Article VIII of the Constitution,
it is hereby certified that the conclusions in the above Decision were reached
in consultation before the case was assigned to the writer of the opinion of
the Court.
REYNATO S. PUNO
[1]
http://www.un.org/News/Press/docs/2007/sgsm11084.doc.htm.
[2] Migrant Workers and
Overseas Filipinos Act of 1995, effective
[3] Penned
by Associate Justice Andres B. Reyes, Jr. and concurred in by Associate
Justices Lucas P. Bersamin and Celia C. Librea-Leagogo; rollo, p. 231.
[4]
[5] Rollo, p. 57.
[6]
[7]
[8]
[9]
[10] According
to petitioner, this amount represents the pro-rated difference between the
salary of US$2,590.00 per month which he was supposed to receive as Chief
Officer from
[11] Position
Paper, id. at 53-54.
[12] The
LA awarded petitioner US$45.00 out of the US$1,480.00 salary differential to
which petitioner is entitled in view of his having received from
respondents US$1,435.00 as evidenced by
receipts marked as Annexes “F”, “G” and
“H”, id. at 319-321.
[13]
[14] Rollo, pp. 111-112.
[15]
[16]
[17] G.R.
No. 129584,
[18] Appeal
Memorandum, rollo, p. 121.
[19]
[20] NLRC
Decision, rollo, p. 140.
[21]
[22]
[23]
[24]
[25] CA
Decision, id. at 239-241.
[26]
[27]
[28] Petition,
rollo, p. 28.
[29]
[30]
[31] Rollo, p. 282
[32] Memorandum
for Petitioner, id. at 741-742.
[33]
[34] Section 18. The State affirms labor as a primary social economic force. It shall protect the rights of workers and
promote their welfare.
[35] Rollo, pp. 763-766.
[36] Petition,
id. at 735.
[37] Memorandum
of the Solicitor General, rollo, p. 680.
[38] Memorandum
for Petitioner, id. at 755.
[39]
[40] Rollo, pp. 645-646 and 512-513.
[41] Alfredo
L. Benipayo was Solicitor General at the time the Comment was filed. Antonio
Eduardo B. Nachura (now an Associate Justice of the Supreme Court) was
Solicitor General when the Memorandum was filed.
[42] Memorandum
of the Solicitor General, id. at 662-665.
[43] G.R.
No. 113658,
[44] G.R.
No. 110524,
[45] Memorandum
of the Solicitor General, rollo, pp. 668-678.
[46]
[47] The
[48] Automotive
Industry Workers
[49] David
v. Macapagal-Arroyo, G.R. No.
171396,
[50] Arceta
v. Mangrobang, G.R. No. 152895,
[51] Moldex
Realty, Inc. v. Housing and Land Use Regulatory Board, G.R. No. 149719, June 21, 2007, 525 SCRA 198; Marasigan
v. Marasigan, G.R. No. 156078,
March 14, 2008, 548 SCRA 409.
[52] Matibag v. Benipayo,
G.R. No. 149036,
[53] Rollo, p. 145.
[54]
[55] Smart
Communications, Inc. v. National Telecommunications Commission, G.R. No. 151908,
[56] Equi-Asia
Placement, Inc. v. Department of Foreign Affairs, G.R. No. 152214, September 19, 2006, 502 SCRA 295.
[57] Memorandum
for Petitioner, rollo, pp. 741-742.
[58] Ortigas & Co., Ltd. v. Court of Appeals, G.R. No. 126102, December 4, 2000, 346 SCRA 748.
[59] Picop
Resources, Inc. v. Base Metals Mineral Resources Corporation, G.R. No. 163509, December 6, 2006, 510 SCRA 400.
[60] Walker
v. Whitehead, 83 U.S. 314 (1873);
Wood v. Lovett, 313 U.S. 362, 370 (1941); Intrata-Assurance
Corporation v. Republic of the Philippines, G.R. No. 156571, July 9, 2008; Smart
Communications, Inc. v. City of Davao, G.R. No. 155491, September 16, 2008.
[61] Executive
Secretary v. Court of Appeals,
G.R. No. 131719, May 25, 2004, 429 SCRA 81, citing JMM Promotion and
Management, Inc. v. Court of Appeals, G.R. No. 120095, August 5, 1996, 260
SCRA 319.
[62] Ortigas
& Co., Ltd. v. Court of Appeals,
supra note 58.
[63] Section
18. The State affirms labor as a primary social economic force. It shall
protect the rights of workers and promote their welfare.
[64] Section
3, 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.
[65] See
City of Manila v. Laguio, G.R. No. 118127, April 12, 2005, 455
SCRA 308; Pimentel III v. Commission on Elections, G.R. No. 178413,
March 13, 2008, 548 SCRA 169.
[66] League
of Cities of the Philippines v. Commission on Elections G.R. No. 176951, November
18, 2008; Beltran v. Secretary of Health, G.R. No. 139147,November 25,
2005, 476 SCRA 168.
[67] Association
of Small Landowners in the
[68]
[69] There
is also the "heightened scrutiny" standard of review which is less
demanding than "strict scrutiny" but more demanding than the standard
rational relation test. Heightened scrutiny has generally been applied to cases
that involve discriminatory classifications based on sex or illegitimacy, such
as in Plyler v. Doe, 457
U.S. 202, where a heightened scrutiny standard was
used to invalidate a State's denial to the children of illegal aliens of the
free public education that it made available to other residents.
[70] America
v. Dale, 530 U.S. 640
(2000); Parents Involved in Community Schools v.
[71] Adarand Constructors, Inc. v. Peña, 515
[72] Grutter
v. Bollinger, 539
[73] The
concept of suspect classification first emerged in the famous footnote in the
opinion of Justice Harlan Stone in U.S.
v. Carolene Products Co., 304 U.S. 144 (1938), the full text of which
footnote is reproduced below:
There may be
narrower scope for operation of the presumption of constitutionality when
legislation appears on its face to be within a specific prohibition of the
Constitution, such as those of the first
ten amendments, which are deemed equally specific when held to be embraced
within the Fourteenth. See Stromberg v.
It is unnecessary to consider now whether legislation which restricts
those political processes which can ordinarily be expected to bring about
repeal of undesirable legislation is to be subjected to more
exacting judicial scrutiny under the general prohibitions of the Fourteenth
Amendment than are most other types of legislation. On restrictions upon the
right to vote, see Nixon v. Herndon, 273 U.S. 536; Nixon v. Condon, 286 U.S.
73; on restraints upon the dissemination of information, see Near v. Minnesota
ex rel. Olson, 283 U.S. 697, 713-714, 718-720, 722; Grosjean v. American Press
Co., 297 U.S. 233; Lovell v. Griffin, supra; on interferences with political
organizations, see Stromberg v. California, supra, 369; Fiske v. Kansas, 274
U.S. 380; Whitney v. California, 274 U.S. 357, 373-378; Herndon v. Lowry, 301
U.S. 242, and see Holmes, J., in Gitlow v.
Nor need we enquire whether similar
considerations enter into the review of statutes directed at particular
religious, Pierce v. Society of Sisters, 268 U.S. 510, or national, Meyer v.
Nebraska, 262 U.S. 390; Bartels v. Iowa, 262 U.S. 404; Farrington v. Tokushige,
273 U.S. 284, or racial minorities, Nixon v. Herndon, supra; Nixon v. Condon,
supra: whether prejudice against discrete and insular
minorities may be a special condition, which tends seriously to curtail the
operation of those political processes ordinarily to be relied upon to
protect minorities, and which may call for a correspondingly more searching
judicial inquiry. Compare McCulloch v.
[74] Korematsu
v.
[75] Frontiero
v. Richardson, 411
[76]
[77] G.R.
No. 148208,
[78] Rollo, pp. 727 and 735.
[79] 371
Phil. 827 (1999).
[80]
[81] G.R.
No. 131656,
[82]
[83] Supra note 17.
[84] G.R.
No. 166363,
[85] G.R.
No. 162195,
[86] G.R.
No. 180719,
[87] G.R.
No. 172031,
[88] G.R.
No. 157534,
[89] G.R.
No. 153750,
[90] G.R.
No. 148418,
[91] G.R.
No. 148407,
[92] G.R.
No. 156381,
[93] G.R.
No. 157373,
[94] G.R.
No. 144786,
[95] G.R.
No. 177948,
[96] G.R.
No. 151303,
[97] Asian
Center v. National Labor Relations Commission, supra note 81.
[98] G.R.
No. 143949,
[99] G.R.
No. 123354,
[100] G.R.
No. 109390,
[101] G.R.
No. 112096,
[102] G.R.
No. 145587,
[103] G.R.
No. 123901,
[104] G.R.
No. 157975,
[105] www.merriam-webster.com/dictionary
visited on
[106] See
also Flourish, supra note 95; and Athena, supra note 96.
[107] It
is noted that both petitioner and the OSG drew comparisons between OFWs in
general and local workers in general. However, the Court finds that the more
relevant comparison is between OFWs whose employment is necessarily subject to
a fixed term and local workers whose employment is also subject to a fixed
term.
[108] Promulgated
on
[109] No. 1133,
[110] No.
L-8431,
[111] See also Wallem Philippines Shipping, Inc. v. Hon.
Minister of Labor, No.
L-50734-37,
[112] No. L-10422,
[113] No. L-15878,
[114] 7 Phil. 268
(1907).
[115] See
also Knust v.
Morse, 41 Phil 184 (1920).
[116] Brent School, Inc. v.
[117] No. L-22608,
[118] The
Labor Code itself does not contain a specific provision for local workers with
fixed-term employment contracts. As the Court observed in Brent School, Inc., the concept of
fixed-term employment has slowly faded away from our labor laws, such that
reference to our labor laws is of limited use in determining the monetary
benefits to be awarded to fixed-term workers who are illegally dismissed.
[119] No. L-65545, July 9, 1986.,
142 SCRA 542.
[120] G.R. No. 100399,
[121] G.R.
No. 111212,
[122] G.R.
No. 113363,
[123] G.R.
No. 113911,
[124] See
Estrada v. Escritor, A.M. No. P-02-1651,
[125]
[126] Roe
v. Wade, 410 U.S. 113 (1971); see
also Carey v. Population Service International, 431
[127] Sabio
v. Gordon, G.R. Nos. 174340,
174318, 174177,
[128] Comment,
rollo, p. 555.
[129] Memorandum
of the Solicitor General, id. at 682-683
[130]
[131] Section
3. 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.
It shall guarantee the rights of all
workers to self-organization, collective bargaining and negotiations, and
peaceful concerted activities, including the right to strike in accordance with
law. They shall be entitled to security of tenure, humane conditions of work,
and a living wage. They shall also participate in policy and decision-making
processes affecting their rights and benefits as may be provided by law.
The State shall promote the principle
of shared responsibility between workers and employers and the preferential use
of voluntary modes in settling disputes, including conciliation, and shall
enforce their mutual compliance therewith to foster industrial peace.
The State
shall regulate the relations between workers and employers, recognizing the
right of labor to its just share in the fruits of production and the right of
enterprises to reasonable returns to investments, and to expansion and growth.
[132] Manila
Prince Hotel v. Government Service Insurance System, G.R. No. 122156,
[133] Basco
v. Philippine Amusement and Gaming Corporation, G.R. No. 91649,
[134] G.R.
No. 158693,
[135] Agabon v. National Labor Relations Commission, supra note 134, at 686.
[136] Associated
Communications and Wireless Services, Ltd.
v. Dumlao, G. R. No.
136762,
[137] Section
1. No person shall be deprived of life, liberty, or property without due
process of law, nor shall any person be denied the equal protection of the
laws.
[138] G.R. No. 180719,