514 SUPREME COURT REPORTS ANNOTATED

Philippine National Bank vs. Cabansag

*
G.R. No. 157010. June 21, 2005.

PHILIPPINE NATIONAL BANK, petitioner, vs.

FLORENCE O. CABANSAG, respondent.

Remedial Law; Appeals; The proper mode of review of NLRC

decisions, resolutions or orders is by a special civil action for
certiorari under Rule 65 of the Rules of Court.—Respondent
assails, in her Comment, the propriety of Rule 45 as the
procedural mode for seeking a review of the CA Decision affirming
the NLRC Resolution. Such issue deserves scant consideration.
Respondent miscomprehends the Court’s discourse in St. Martin
Funeral Home v. NLRC, which has indeed affirmed that the
proper mode of review of NLRC decisions, resolutions or orders is
by a special civil action for certiorari under Rule 65 of the Rules of
Court. The Supreme Court and the Court of Appeals have
concurrent original jurisdiction over such petitions for certiorari.
Thus, in observance of the doctrine on the hierarchy of courts,
these petitions should be initially filed with the CA.
Same; Same; In a petition for review on certiorari, the scope of
the Supreme Court’s judicial review of decisions of the Court of
Appeals is generally confined only to errors of law.—In a petition
for review on certiorari, the scope of the Supreme Court’s judicial
review of decisions of the Court of Appeals is generally confined
only to

_______________

* THIRD DIVISION.

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VOL. 460, JUNE 21, 2005 515

Philippine National Bank vs. Cabansag

errors of law. It does not extend to questions of fact. This doctrine
applies with greater force in labor cases. Factual questions are for
the labor tribunals to resolve. In the present case, the labor
arbiter and the NLRC have already determined the factual issues.
Their findings, which are supported by substantial evidence, were
affirmed by the CA. Thus, they are entitled to great respect and
are rendered conclusive upon this Court, absent a clear showing
of palpable error or arbitrary disregard of evidence.
Labor Law; Labor Arbiters; Jurisdictions; Labor arbiters have
original and exclusive jurisdiction over claims arising from
employer-employee relations, including termination disputes
involving all workers, among whom are Overseas Filipino Workers
(OFW).—Based on the foregoing provisions, labor arbiters clearly
have original and exclusive jurisdiction over claims arising from
employer-employee relations, including termination disputes
involving all workers, among whom are overseas Filipino workers
(OFW).
Same; Same; Same; Respondent subsequently became a
contract worker or an OFW who was covered by Philippine labor
laws and policies upon certification by the POEA.—Noteworthy is
the fact that respondent likewise applied for and secured an
Overseas Employment Certificate from the POEA through the
Philippine Embassy in Singapore. The Certificate, issued on
March 8, 1999, declared her a bona fide contract worker for
Singapore. Under Philippine law, this document authorized her
working status in a foreign country and entitled her to all benefits
and processes under our statutes. Thus, even assuming arguendo
that she was considered at the start of her employment as a
“direct hire” governed by and subject to the laws, common
practices and customs prevailing in Singapore she subsequently
became a contract worker or an OFW who was covered by
Philippine labor laws and policies upon certification by the POEA.
At the time her employment was illegally terminated, she already
possessed the POEA employment Certificate.
Same; Same; Same; Whether employed locally or overseas, all
Filipino workers enjoy the protective mantle of Philippine labor
and social legislation, contract stipulations to the contrary
notwithstanding.—“x x x. Whether employed locally or overseas,
all Filipino workers enjoy the protective mantle of Philippine
labor and social legislation, contract stipulations to the contrary
notwithstanding.

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516 SUPREME COURT REPORTS ANNOTATED

 Philippine National Bank vs. Cabansag

This pronouncement is in keeping with the basic public policy of

the State to 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. For
the State assures the basic rights of all workers to self-
organization, collective bargaining, security of tenure, and just
and humane conditions of work [Article 3 of the Labor Code of the
Philippines; See also Section 18, Article II and Section 3, Article
XIII, 1987 Constitution]. This ruling is likewise rendered
imperative by Article 17 of the Civil Code which states that laws
‘which have for their object public order, public policy and good
customs shall not be rendered ineffective by laws or judgments
promulgated, or by determination or conventions agreed upon in a
foreign country.’ ”
Same; Same; Same; Being a migrant worker or overseas
Filipino worker, respondent given the option to choose the venue of
her complaint against petitioner for illegal dismissal.—Under the
“Migrant Workers and Overseas Filipinos Act of 1995” (RA 8042),
a migrant worker “refers to a person who is to be engaged, is
engaged or has been engaged in a remunerated activity in a state
of which he or she is not a legal resident; to be used
interchangeably with overseas Filipino worker.” Undeniably,
respondent was employed by petitioner in its branch office in
Singapore. Admittedly, she is a Filipino and not a legal resident of
that state. She thus falls within the category of “migrant worker”
or “overseas Filipino worker.” As such, it is her option to choose
the venue of her Complaint against petitioner for illegal
dismissal. The law gives her two choices: (1) at the Regional
Arbitration Branch (RAB) where she resides or (2) at the RAB
where the principal office of her employer is situated. Since her
dismissal by petitioner, respondent has returned to the
Philippines—specifically to her residence at Filinvest II, Quezon
City. Thus, in filing her Complaint before the RAB office in
Quezon City, she has made a valid choice of proper venue.
Same; Dismissals; Due Process; The twin requirements of
notice and hearing constitute the essential elements of procedural
due process, and neither of these elements can be eliminated
without running afoul of the constitutional guarantee.—As a
regular employee, respondent was entitled to all rights, benefits
and privileges provided under our labor laws. One of her
fundamental rights is that she may not be dismissed without due
process of law. The twin requirements

517
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Philippine National Bank vs. Cabansag

of notice and hearing constitute the essential elements of

procedural due process, and neither of these elements can be
eliminated without running afoul of the constitutional guarantee.
In dismissing employees, the employer must furnish them two
written notices: 1) one to apprise them of the particular acts or
omissions for which their dismissal is sought; and 2) the other to
inform them of the decision to dismiss them. As to the
requirement of a hearing, its essence lies simply in the
opportunity to be heard.
Same; Same; Same; Nothing in the law gives an employer the
option to substitute the required prior notice and opportunity to be
heard with the mere payment of 30 days’ salary.—All that
petitioner tendered to respondent was a notice of her employment
termination effective the very same day, together with the
equivalent of a one-month pay. This Court has already held that
nothing in the law gives an employer the option to substitute the
required prior notice and opportunity to be heard with the mere
payment of 30 days’ salary.
Same; Same; When there is no showing of any clear, valid,
and legal cause for the termination of employment, the law
considers the matter a case of illegal dismissal.—Basic in our
jurisprudence is the principle that when there is no showing of
any clear, valid, and legal cause for the termination of
employment, the law considers the matter a case of illegal
dismissal.
Same; Same; Damages; Awards for moral and exemplary
damages would be proper if the employee was harassed and
arbitrarily dismissed by the employer.—Finally, moral damages
are recoverable when the dismissal of an employee is attended by
bad faith or constitutes an act oppressive to labor or is done in a
manner contrary to morals, good customs or public policy. Awards
for moral and exemplary damages would be proper if the
employee was harassed and arbitrarily dismissed by the
employer.
Same; Same; Same; Attorney’s Fees; When an action is
instituted for the recovery of wages, or when employees are forced
to litigate and consequently incur expenses to protect their rights
and interests, the grant of attorney’s fees is legally justifiable.—
The Court also affirms the award of attorney’s fees. It is settled
that when an action is instituted for the recovery of wages, or
when employees are

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Philippine National Bank vs. Cabansag

forced to litigate and consequently incur expenses to protect their

rights and interests, the grant of attorney’s fees is legally
justifiable.

PETITION for review on certiorari of the decision and

resolution of the Court of Appeals.

The facts are stated in the opinion of the Court.

     Marino M. Buban, Jr. for petitioner PNB.
     Elvira de Vera Bitonio for respondent.

PANGANIBAN, J.:

The Court reiterates the basic policy that all Filipino

workers, whether employed locally or overseas, enjoy the
protective mantle of Philippine labor and social
legislations. Our labor statutes may not be rendered
ineffective by laws or judgments promulgated, or
stipulations agreed upon, in a foreign country.

The Case
1
Before us is a Petition for Review on Certiorari under Rule
45 of the Rules of Court, seeking
2
to reverse and set aside
the July 16,3
2002 Decision and the January 29, 2003
Resolution of the Court of Appeals (CA) in CA-GR SP No.
68403. The assailed Decision dismissed the CA Petition
(filed by herein petitioner), which had sought to reverse the
National Labor 4Relations Commission (NLRC)’s June 29,
2001 Resolution,

_______________

1 Rollo, pp. 9-31.

2 Id., pp. 33-56. Tenth Division. Penned by Justice Romeo J. Callejo, Sr.
(chairman and now a member of this Court), with the concurrence of
Justices Remedios Salazar-Fernando and Danilo B. Pine (members).
3 Id., pp. 59-60.
4 Id., pp. 75-91.

519

VOL. 460, JUNE 21, 2005 519

 Philippine National Bank vs. Cabansag

affirming5 Labor Arbiter Joel S. Lustria’s January 18, 2000

Decision.
The assailed CA Resolution denied herein petitioner’s
Motion for Reconsideration.

The Facts

The facts are narrated by the Court of Appeals as follows:

“In late 1998, [herein Respondent Florence Cabansag] arrived in

Singapore as a tourist. She applied for employment, with the
Singapore Branch of the Philippine National Bank, a private
banking corporation organized and existing under the laws of the
Philippines, with principal offices at the PNB Financial Center,
Roxas Boulevard, Manila. At the time, the Singapore PNB Branch
was under the helm of Ruben C. Tobias, a lawyer, as General
Manager, with the rank of Vice-President of the Bank. At the
time, too, the Branch Office had two (2) types of employees: (a)
expatriates or the regular employees, hired in Manila and
assigned abroad including Singapore, and (b) locally (direct)
hired. She applied for employment as Branch Credit Officer, at a
total monthly package of $SG4,500.00, effective upon assumption
of duties after approval. Ruben C. Tobias found her eminently
qualified and wrote on October 26, 1998, a letter to the President
of the Bank in Manila, recommending the appointment of
Florence O. Cabansag, for the position.
x x x      x x x      x x x
“The President of the Bank was impressed with the credentials
of Florence O. Cabansag that he approved the recommendation of
Ruben C. Tobias. She then filed an ‘Application,’ with the
Ministry of Manpower of the Government of Singapore, for the
issuance of an ‘Employment Pass’ as an employee of the Singapore
PNB Branch. Her application was approved for a period of two (2)
years.
“On December 7, 1998, Ruben C. Tobias wrote a letter to
Florence O. Cabansag offering her a temporary appointment, as
Credit Officer, at a basic salary of Singapore Dollars 4,500.00, a
month and, upon her successful completion of her probation to be
determined solely, by the Bank, she may be extended at the
discretion of the

_______________

5 Id., pp. 62-74.

520
520 SUPREME COURT REPORTS ANNOTATED
Philippine National Bank vs. Cabansag

Bank, a permanent appointment and that her temporary

appointment was subject to the following terms and conditions:

‘1. You will be on probation for a period of three (3)

consecutive months from the date of your assumption of
duty.
‘2. You will observe the Bank’s rules and regulations and
those that may be adopted from time to time.
‘3. You will keep in strictest confidence all matters related to
transactions between the Bank and its clients.
‘4. You will devote your full time during business hours in
promoting the business and interest of the Bank.
‘5. You will not, without prior written consent of the Bank, be
employed in anyway for any purpose whatsoever outside
business hours by any person, firm or company.
‘6. Termination of your employment with the Bank may be
made by either party after notice of one (1) day in writing
during probation, one month notice upon confirmation or
the equivalent of one (1) day’s or month’s salary in lieu of
notice.’

“Florence O. Cabansag accepted the position and assumed

office. In the meantime, the Philippine Embassy in Singapore
processed the employment contract of Florence O. Cabansag and,
on March 8, 1999, she was issued by the Philippine Overseas
Employment Administration, an ‘Overseas Employment
Certificate,’ certifying that she was a bona fide contract worker for
Singapore.
x x x      x x x      x x x
“Barely three (3) months in office, Florence O. Cabansag
submitted to Ruben C. Tobias, on March 9, 1999, her initial
‘Performance Report.’ Ruben C. Tobias was so impressed with the
‘Report’ that he made a notation and, on said ‘Report’: ‘GOOD
WORK.’ However, in the evening of April 14, 1999, while Florence
O. Cabansag was in the flat, which she and Cecilia Aquino, the
Assistant Vice-President and Deputy General Manager of the
Branch and Rosanna Sarmiento, the Chief Dealer of the said
Branch, rented, she was told by the two (2) that Ruben C. Tobias
has asked them to tell Florence O. Cabansag to resign from her
job. Florence O. Cabansag was perplexed at the sudden turn of
events and the runabout way Ruben C. Tobias procured her
resignation from the Bank. The next day, Florence O. Cabansag
talked to Ruben C. Tobias and inquired if what Cecilia Aquino
and Rosanna Sarmiento had told her was true. Ruben C. Tobias
confirmed the veracity of the information, with the expla-
 521

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Philippine National Bank vs. Cabansag

nation that her resignation was imperative as a ‘cost-cutting

measure’ of the Bank. Ruben C. Tobias, likewise, told Florence O.
Cabansag that the PNB Singapore Branch will be sold or
transformed into a remittance office and that, in either way,
Florence O. Cabansag had to resign from her employment. The
more Florence O. Cabansag was perplexed. She then asked Ruben
C. Tobias that she be furnished with a ‘Formal Advice’ from the
PNB Head Office in Manila. However, Ruben C. Tobias flatly
refused. Florence O. Cabansag did not submit any letter of
resignation.
“On April 16, 1999, Ruben C. Tobias again summoned Florence
O. Cabansag to his office and demanded that she submit her
letter of resignation, with the pretext that he needed a Chinese-
speaking Credit Officer to penetrate the local market, with the
information that a Chinese-speaking Credit Officer had already
been hired and will be reporting for work soon. She was warned
that, unless she submitted her letter of resignation, her
employment record will be blemished with the notation
‘DISMISSED’ spread thereon. Without giving any definitive
answer, Florence O. Cabansag asked Ruben C. Tobias that she be
given sufficient time to look for another job. Ruben C. Tobias told
her that she should be ‘out’ of her employment by May 15, 1999.
“However, on April 19, 1999, Ruben C. Tobias again summoned
Florence O. Cabansag and adamantly ordered her to submit her
letter of resignation. She refused. On April 20, 1999, she received
a letter from Ruben C. Tobias terminating her employment with
the Bank.
x x x      x x x      x x x
“On January 18, 2000, the Labor Arbiter rendered judgment in
favor of the Complainant and against the Respondents, the
decretal portion of which reads as follows:

‘WHEREFORE, considering the foregoing premises, judgment is hereby

rendered finding respondents guilty of Illegal dismissal and devoid of due
process, and are hereby ordered:
1. To reinstate complainant to her former or substantially equivalent
position without loss of seniority rights, benefits and privileges;
2. Solidarily liable to pay complainant as follows:

522

522 SUPREME COURT REPORTS ANNOTATED

Philippine National Bank vs. Cabansag
 a) To pay complainant her backwages from 16 April 1999 up to her
actual reinstatement. Her backwages as of the date of the
promulgation of this decision amounted to SGD 40,500.00 or its
equivalent in Philippine Currency at the time of payment;
b) Mid-year bonus in the amount of SGD 2,250.00 or its equivalent
in Philippine Currency at the time of payment;
c) Allowance for Sunday banking in the amount of SGD 120.00 or its
equivalent in Philippine Currency at the time of payment;
d) Monetary equivalent of leave credits earned on Sunday banking
in the amount of SGD 1,557.67 or its equivalent in Philippine
Currency at the time of payment;
e) Monetary equivalent of unused sick leave benefits in the amount
of SGD 1,150.60 or its equivalent in Philippine Currency at the
time of payment.
f) Monetary equivalent of unused vacation leave benefits in the
amount of SGD 319.85 or its equivalent in Philippine Currency at
the time of payment.
g) 13th month pay in the amount of SGD 4,500.00 or its equivalent
in Philippine Currency at the time of payment;

3. Solidarily to pay complainant actual damages in the amount

of SGD 1,978.00 or its equivalent in Philippine Currency at the
time of payment, and moral damages in the amount of PhP
200,000.00, exemplary damages in the amount of PhP 100,000.00;
4. To pay complainant the amount of SGD 5,039.81 or its
equivalent in Philippine Currency at the time of payment,
representing attorney’s
6
fees.
SO ORDERED.” [Emphasis in the original.]

PNB appealed the labor arbiter’s Decision to the NLRC. In

a Resolution dated June 29, 2001, the Commission affirmed

_______________

6 Assailed Decision, pp. 2-7; Rollo, pp. 34-39.

523

VOL. 460, JUNE 21, 2005 523

Philippine National Bank vs. Cabansag

that Decision, but reduced the moral damages to P100,000

and the exemplary damages to P50,000. In a subsequent
Resolution, the NLRC denied PNB’s Motion for
Reconsideration.
Ruling of the Court of Appeals

In disposing of the Petition for Certiorari, the CA noted

that petitioner bank had failed to adduce in evidence the
Singaporean law supposedly governing the latter’s
employment Contract with respondent. The appellate court
found that the Contract had actually been processed by the
Philippine Embassy in Singapore and approved by the
Philippine Overseas Employment Administration (POEA),
which then used that Contract as a basis for issuing an
Overseas Employment Certificate in favor of respondent.
According to the CA, even though respondent secured an
employment pass from the Singapore Ministry of
Employment, she did not thereby waive Philippine labor
laws, or the jurisdiction of the labor arbiter or the NLRC
over her Complaint for illegal dismissal. In so doing,
neither did she submit herself solely to the Ministry of
Manpower of Singapore’s jurisdiction over disputes arising
from her employment. The appellate court further noted
that a cursory reading of the Ministry’s letter will readily
show that no such waiver or submission is stated or
implied.
Finally, the CA held that petitioner had failed to
establish a just cause for the dismissal of respondent. The
bank had also failed to give her sufficient notice and an
opportunity to be heard and to defend herself. The CA
ruled that she was consequently entitled to reinstatement
and back wages, computed from the time of her dismissal
up to the time of her reinstatement.
7
Hence, this Petition.

_______________

7 This case was deemed submitted for decision on December 5, 2003,

upon this Court’s receipt of respondent’s Memorandum—signed by Atty.
Elvira de Vera Bitonio. Petitioner’s Memorandum,

524

524 SUPREME COURT REPORTS ANNOTATED

Philippine National Bank vs. Cabansag

Issues
Petitioner submits the following issues for our
consideration:

“1. Whether or not the arbitration branch of the NLRC

in the National Capital Region has jurisdiction over
the instant controversy;
“2. Whether or not the arbitration of the NLRC in the
National Capital Region is the most convenient
venue or forum to hear and decide the instant
controversy; and
“3. Whether or not the respondent was illegally
dismissed, and therefore, entitled to recover8 moral
and exemplary damages and attorney’s fees.”
9
In addition, respondent assails, in her Comment, the
propriety of Rule 45 as the procedural mode for seeking a
review of the CA Decision affirming the NLRC Resolution.
Such issue deserves scant consideration. Respondent
miscomprehends the Court’s 10
discourse in St. Martin
Funeral Home v. NLRC, which has indeed affirmed that
the proper mode of review of NLRC decisions, resolutions
or orders is by a special civil action for certiorari under
Rule 65 of the Rules of Court. The Supreme Court and the
Court of Appeals have concurrent original jurisdiction over
such petitions for certiorari. Thus, in observance of the
doctrine on the hierarchy of 11courts, these petitions should
be initially filed with the CA.
Rightly, the bank elevated the NLRC Resolution to the
CA by way of a Petition for Certiorari. In seeking a review
by this Court of the CA Decision—on questions of
jurisdiction, venue

_______________

signed by Attys. Benilda V. Abrasia-Tejada, Irahlyn P. Sacupayo-

Lariba and Marino M. Buban Jr.—was received by this Court on
November 7, 2003.
8 Petition, p. 8; Rollo, p. 16.
9 Rollo, pp. 100-110.
10 356 Phil. 811; 295 SCRA 494, September 16, 1998.
11 Id., p. 824.

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VOL. 460, JUNE 21, 2005 525

Philippine National Bank vs. Cabansag
and validity of employment termination—petitioner
12
is
likewise correct in invoking Rule 45.
It is true, however, that in a petition for review on
certiorari, the scope of the Supreme Court’s judicial review
of decisions of the Court of Appeals is generally confined
only to errors of law. It does not extend to questions of fact.
This doctrine applies with greater force in labor cases. 13
Factual questions are for the labor tribunals to resolve. In
the present case, the labor arbiter and the NLRC have
already determined the factual issues. Their findings,
which are supported by substantial evidence, were affirmed
by the CA. Thus, they are entitled to great respect and are
rendered conclusive upon this Court, absent a clear
showing 14of palpable error or arbitrary disregard of
evidence.

The Court’s Ruling

The Petition has no merit.

First Issue:
Jurisdiction
The jurisdiction of labor arbiters and the NLRC is specified
in Article 217 of the Labor Code as follows:

“ART. 217. Jurisdiction of Labor Arbiters and the Commission.—

(a) Except as otherwise provided under this Code the Labor
Arbiters shall have original and exclusive jurisdiction to hear and

_______________

12 See Retuya v. Dumarpa, 408 SCRA 315, August 5, 2003.

13 Alfaro v. Court of Appeals, 416 Phil. 310; 363 SCRA 799, August 28, 2001.
14 Ibid. See also PNOC Dockyard & Engineering Corp. v. National Labor
Relations Commission, 353 Phil. 431; 291 SCRA 231, June 26, 1998; KAMADA v.
Ferrer-Calleja, 344 Phil. 67; 278 SCRA 531, September 5, 1997; Caurdanetaan
Piece Workers Union v. Laguesma, 350 Phil. 35; 286 SCRA 401, February 24, 1998;
Tan v. National Labor Relations Commission, 359 Phil. 499; 299 SCRA 169,
November 24, 1998.

526

526 SUPREME COURT REPORTS ANNOTATED

Philippine National Bank vs. Cabansag

decide, within thirty (30) calendar days after the submission of

the case by the parties for decision without extension, even in the
absence of stenographic notes, the following cases involving all
workers, whether agricultural or non-agricultural:

1. Unfair labor practice cases;

2. Termination disputes;
3. If accompanied with a claim for reinstatement, those cases
that workers may file involving wage, rates of pay, hours
of work and other terms and conditions of employment
4. Claims for actual, moral, exemplary and other forms of
damages arising from the employer-employee relations;
5. Cases arising from any violation of Article 264 of this
Code, including questions involving the legality of strikes
and lockouts; and
6. Except claims for Employees Compensation, Social
Security, Medicare and maternity benefits, all other
claims, arising from employer-employee relations,
including those of persons in domestic or household
service, involving an amount of exceeding five thousand
pesos (P5,000.00) regardless of whether accompanied with
a claim for reinstatement.

(b) The commission shall have exclusive appellate jurisdiction

over all cases decided by Labor Arbiters.

x x x      x x x      x x x.”

More specifically, Section 10 of RA 8042 reads in part:

“SECTION 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 any law
or contract involving Filipino workers for overseas deployment
including claims for actual, moral, exemplary and other forms of
damages.
x x x      x x x      x x x”

Based on the foregoing provisions, labor arbiters clearly

have original and exclusive jurisdiction over claims arising
527

VOL. 460, JUNE 21, 2005 527

Philippine National Bank vs. Cabansag
from employer-employee relations, including termination
disputes involving all workers,
15
among whom are overseas
Filipino workers (OFW).
We are not unmindful of the fact that respondent was
directly hired, while on a tourist status in Singapore, by
the PNB branch in that city state. Prior to employing
respondent, petitioner had to obtain an employment pass
for her from the Singapore Ministry of Manpower. Securing
the pass was a regulatory requirement 16
pursuant to the
immigration regulations of that country.
Similarly, the Philippine government requires non-
Filipinos working in the country to first obtain a local work
permit in order to be legally employed here. That permit,
however, does not automatically mean that the non-citizen
is thereby bound by local laws only, as averred by
petitioner. It does not at all imply a waiver of one’s national
laws on labor. Absent any clear and convincing evidence to
the contrary, such permit simply means that its holder has
a legal status as a worker in the issuing country.
Noteworthy is the fact that respondent likewise applied
for and secured an Overseas Employment Certificate from
the POEA through the Philippine Embassy in Singapore.
The Certificate, issued on March 8, 1999, declared her a
bona fide contract worker for Singapore. Under Philippine
law, this document authorized her working status in a
foreign country and entitled her to all benefits and
processes under our stat-

_______________

15 §3(a) of RA 8042 defines migrant worker as “a person who is to be

engaged, is engaged or has been engaged in a remunerated activity in a
state in which he or she is not a legal resident; to be used interchangeably
with overseas Filipino worker.” (Emphasis ours.)
16 Paragraph 8 of the employment pass states:

“If there is a change in the Designation or Duties as declared in the application

form for an Employment Pass, a fresh application is required. It is an offence
under the Immigration Regulations for failing to do so.” (Annex “5-a” to Comment;
Rollo, p. 120.)

528

528 SUPREME COURT REPORTS ANNOTATED

Philippine National Bank vs. Cabansag

utes. Thus, even assuming arguendo that she was

considered at the start of her employment as a “direct hire”
governed by and subject to the laws,
17
common practices and
customs prevailing in Singapore she subsequently became
a contract worker or an OFW who was covered by
Philippine labor laws and policies upon certification by the
POEA. At the time her employment was illegally
terminated, she already possessed the POEA employment
Certificate.
Moreover, petitioner admits that it is a Philippine
corporation18 doing business through a branch office in
Singapore. Significantly, respondent’s employment by the
Singapore branch
19
office had to be approved by Benjamin P.
Palma Gil, the president of the bank whose principal
offices were in Manila. This circumstance militates against
petitioner’s contention that respondent was “locally hired”;
and totally “governed by and subject to the laws, common
practices and customs” of Singapore, not of the Philippines.
Instead, with more reason does this fact reinforce the
presumption that respondent falls under the legal
definition of migrant worker, in this case one deployed in
Singapore. Hence, petitioner cannot escape the application
of Philippine laws or the jurisdiction of the NLRC and the
labor arbiter.
In any event, we recall the following policy
pronouncement
20
of the Court in Royal Crown Internationale
v. NLRC:

“x x x. Whether employed locally or overseas, all Filipino workers

enjoy the protective mantle of Philippine labor and social
legislation, contract stipulations to the contrary notwithstanding.
This pronouncement is in keeping with the basic public policy of
the State to 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. For
the State assures the basic rights of all workers to self-
organization, collective bargaining,

_______________

17 Petition, p. 3; Rollo, p. 11.

18 Petitioner’s Memorandum, p. 22; Rollo, p. 178.
19 Annex “2” to Comment; Rollo, pp. 113-114.
20 178 SCRA 569, 580-581, October 16, 1989, per Cortes, J.

529

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Philippine National Bank vs. Cabansag
security of tenure, and just and humane conditions of work
[Article 3 of the Labor Code of the Philippines; See also Section
18, Article II and Section 3, Article XIII, 1987 Constitution]. This
ruling is likewise rendered imperative by Article 17 of the Civil
Code which states that laws ‘which have for their object public
order, public policy and good customs shall not be rendered
ineffective by laws or judgments promulgated, or by
determination or conventions agreed upon in a foreign country.’ ”

Second Issue:
Proper Venue
Section 1(a) of Rule IV of the NLRC Rules of Procedure
reads:

“Section 1. Venue.—(a) All cases which Labor Arbiters have

authority to hear and decide may be filed in the Regional
Arbitration Branch having jurisdiction over the workplace of the
complainant/petitioner; Provided, however that cases of Overseas
Filipino Worker (OFW) shall be filed before the Regional
Arbitration Branch where the complainant resides or where the
principal office of the respondent/employer is situated, at the
option of the complainant.
“For purposes of venue, workplace shall be understood as the
place or locality where the employee is regularly assigned when
the cause of action arose. It shall include the place where the
employee is supposed to report back after a temporary detail,
assignment or travel. In the case of field employees, as well as
ambulant or itinerant workers, their workplace is where they are
regularly assigned, or where they are supposed to regularly
receive their salaries/wages or work instructions from, and report
the results of their assignment to their employers.”

Under the “Migrant Workers and Overseas Filipinos Act of

1995” (RA 8042), a migrant worker “refers to a person who
is to be engaged, is engaged or has been engaged in a
remunerated activity in a state of which he or she is not a
legal resident; to21 be used interchangeably with overseas
Filipino worker.”

_______________

21 §3(a), RA 8042; also §§2(a) and (e), Rule II of the Omnibus Rules and
Regulations Implementing the Migrant Workers and Overseas Filipinos
Act.

530

530 SUPREME COURT REPORTS ANNOTATED

 Philippine National Bank vs. Cabansag

Undeniably, respondent was employed by petitioner in its

branch office in Singapore. Admittedly, she is a Filipino
and not a legal resident of that state. She thus falls within
the category of “migrant worker” or “overseas Filipino
worker.”
As such, it is her option to choose the venue of her
Complaint against petitioner for illegal dismissal. The law
gives her two choices: (1) at the Regional Arbitration
Branch (RAB) where she resides or (2) at the RAB where
the principal office of her employer is situated. Since her
dismissal by petitioner, respondent has returned to the
Philippines—specifically to her residence at Filinvest II,
Quezon City. Thus, in filing her Complaint before the RAB
office in Quezon City, she has made a valid choice of proper
venue.

Third Issue:
Illegal Dismissal
The appellate court was correct in holding that respondent
was already a regular employee at the time of her
dismissal, because her three-month probationary period of
employment had already ended. This ruling is in
accordance with Article 281 of the Labor Code: “An
employee who is allowed to work after a probationary
period shall be considered a regular employee.” Indeed,
petitioner recognized respondent as such at the time it
dismissed her, by giving her one month’s salary in lieu of a
one-month notice, consistent with provision No. 6 of her
employment Contract.

Notice and Hearing

Not Complied With

As a regular employee, respondent was entitled to all

rights, benefits and privileges provided under our labor
laws. One of her fundamental rights is that she may not be
dismissed without due process of law. The twin
requirements of notice and hearing constitute the essential
elements of proce-
531

VOL. 460, JUNE 21, 2005 531

Philippine National Bank vs. Cabansag
dural due process, and neither of these elements can be
eliminated22 without running afoul of the constitutional
guarantee.
In dismissing employees, the employer must furnish
them two written notices: 1) one to apprise them of the
particular acts or omissions for which their dismissal is
sought; and 2) the other to inform them of the decision to
dismiss them. As to the requirement of a hearing, 23
its
essence lies simply in the opportunity to be heard.
The evidence in this case is crystal-clear. Respondent
was not notified of the specific act or omission for which her
dismissal was being sought. Neither was she given any
chance to be heard, as required by law. At any rate, even if
she were given the opportunity to be heard, she could not
have defended herself effectively, for she knew no cause to
answer to.
All that petitioner tendered to respondent was a notice
of her employment termination effective the very same day,
together with the equivalent of a one-month pay. This
Court has already held that nothing in the law gives an
employer the option to substitute the required prior notice
and opportunity
24
to be heard with the mere payment of 30
days’ salary.
Well-settled is the rule that the employer shall be
sanctioned for noncompliance with the requirements of, or
for failure to observe, due
25
process that must be observed in
dismissing an employee.

_______________

22 Vinta Maritime Co., Inc. v. National Labor Relations Commission,

348 Phil. 714; 284 SCRA 656, January 23, 1998.
23 Paguio Transport Corp. v. National Labor Relations Commission, 356
Phil. 158; 294 SCRA 657, August 28, 1998; Tan v. National Labor
Relations Commission, supra; Pascua v. National Labor Relations
Commission, 351 Phil. 48; 287 SCRA 554, March 13, 1998; Vinta Maritime
Co., Inc. v. National Labor Relations Commission, supra.
24 Serrano v. National Labor Relations Commission, 387 Phil. 345; 331
SCRA 331, May 4, 2000.
25 Fernandez, v. National Labor Relations Commission, 349 Phil. 65;
285 SCRA 149, January 28, 1998.

532

532 SUPREME COURT REPORTS ANNOTATED

Philippine National Bank vs. Cabansag
No Valid Cause
for Dismissal
26 27 28
Moreover, Articles 282, 283 and 284 of the Labor Code
provide the valid grounds or causes for an employee’s dis-

_______________

26 “Art. 282. Termination by employer.—An employer may terminate an

employment for any of the following causes: (a) serious misconduct or
willful disobedience by the employee of the lawful orders of his employer
or representative in connection with his work; (b) gross and habitual
neglect by the employee of his duties; (c) fraud or willful breach by the
employee of the trust reposed in him by his employer or duly authorized
representative; (d) commission of a crime or offense by the employee
against the person of his employer or any immediate member of his family
or his duly authorized representative; and (e) other causes analogous to
the foregoing.”
27 “Art. 283. Closure of establishment and reduction of personnel.—The
employer may also terminate the employment of any employee due to the
installation of labor saving devices, redundancy, retrenchment to prevent
losses or the closing or cessation of operation of the establishment or
undertaking unless the closing is for the purpose of circumventing the
provisions of this title, by serving a written notice on the workers and the
[Department] of Labor and Employment at least one (1) month before the
intended date thereof. In case of termination due to the installation of
labor saving devices or redundancy, the worker affected thereby shall be
entitled to a separation pay equivalent to at least his one (1) month pay or
to at least one (1) month pay for every year of service, whichever is higher.
In case of retrenchment to prevent losses and in cases of closures or
cessation of operations of establishment or undertaking not due to serious
business losses or financial reverses, the separation pay shall be
equivalent to one (1) month pay or to at least one-half (1/2) month pay for
every year of service, whichever is higher. A fraction of at least six (6)
months shall be considered one (1) whole year.”
28 “Art. 284. Disease as ground for termination.—An employer may
terminate the services of an employee who has been found to be suffering
from any disease and whose continued employment is prohibited by law or
is prejudicial to his health as well as to the health of his co-employees:
Provided, That he is paid separation pay equivalent to at least one (1)
month salary or to one-half month salary for every year or service,
whichever is greater, a fraction of at least six (6) months being considered
as one (1) whole year.”

533

VOL. 460, JUNE 21, 2005 533

Philippine National Bank vs. Cabansag
missal. The employer has the burden of proving that it was
done for any of those just or authorized causes. The failure
to discharge this burden means that the dismissal was not
justified, and that
29
the employee is entitled to reinstatement
and back wages.
Notably, petitioner has not asserted any of the grounds
provided by law as a valid reason for terminating the
employment of respondent. It merely insists that her
dismissal was validly effected pursuant to the provisions of
her employment Contract, which she had voluntarily
agreed to be bound to.
Truly, the contracting parties may establish such
stipulations, clauses, terms and conditions as they want,
and their agreement would have the force of law between
them. However, petitioner overlooks the qualification that
those terms and conditions agreed upon must not be
contrary
30
to law, morals, customs, public policy or public
order. As explained earlier, the employment Contract
between petitioner and respondent is governed by
Philippine labor laws. Hence, the stipulations, clauses, and
terms and conditions of the Contract must not contravene
our labor law provisions.
Moreover, a contract of employment is imbued with
public interest. The Court has time and time again
reminded parties that they “are not at liberty to insulate
themselves and their relationships from the impact of labor
laws and31
regulations by simply contracting with each
other.” Also, while a contract is

_______________

29 Paguio Transport Corp. v. National Labor Relations Commission,

supra; Caurdanetaan Piece Workers Union v. Laguesma, supra; Vinta
Maritime Co., Inc. v. National Labor Relations Commission, supra; Anino
v. National Labor Relations Commission, 352 Phil. 1098; 290 SCRA 489,
May 21, 1998.
30 Solid Homes, Inc. v. Court of Appeals, 341 Phil. 261, 280; 275 SCRA
267, July 8, 1997.
31 Pakistan International Airlines Corp. v. Ople, 190 SCRA 90, 99,
September 28, 1990, per Feliciano, J. (cited in Bernardo v. National Labor
Relations Commission, 369 Phil. 443; 310 SCRA 186,

534

534 SUPREME COURT REPORTS ANNOTATED

Philippine National Bank vs. Cabansag
the law between the parties, the provisions of positive law
that regulate such contracts are deemed included and
32
shall
limit and govern the relations between the parties.
Basic in our jurisprudence is the principle that when
there is no showing of any clear, valid, and legal cause for
the termination of employment, 33
the law considers the
matter a case of illegal dismissal.

Awards for Damages

Justified

Finally, moral damages are recoverable when the dismissal

of an employee is attended by bad faith or constitutes an
act oppressive to labor or is done in a 34manner contrary to
morals, good customs or public policy. Awards for moral
and exemplary damages would be proper if the employee 35
was harassed and arbitrarily dismissed by the employer.
In affirming the awards of moral and exemplary
damages, we quote with approval the following
ratiocination of the labor arbiter:

“The records also show that [respondent’s] dismissal was effected

by [petitioners’] capricious and high-handed manner, anti-

_______________

July 12, 1999; Magsalin v. National Organization of Working Men, 403 SCRA
199, May 9, 2003).
32 Asia World Recruitment, Inc. v. National Labor Relations Commission, 371
Phil. 745; 313 SCRA 1, August 24, 1999.
33 Vinta Maritime Co., Inc. v. National Labor Relations Commission, supra.
34 Pascua v. National Labor Relations Commission, supra; Nueva Ecija I
Electric Cooperative, Inc. v. National Labor Relations Commission, 380 Phil. 44;
323 SCRA 86, January 24, 2000.
35 Cruz v. National Labor Relations Commission, 381 Phil. 775; 324 SCRA 770,
February 7, 2000 (cited in Asia Pacific Chartering [Phils.], Inc. v. Farolan, 441
Phil. 776; 393 SCRA 454, December 4, 2002).

535

VOL. 460, JUNE 21, 2005 535

Philippine National Bank vs. Cabansag

social and oppressive, fraudulent and in bad faith, and contrary to

morals, good customs and public policy. Bad faith and fraud are
shown in the acts committed by [petitioners] before, during and
after [respondent’s] dismissal in addition to the manner by which
she was dismissed. First, [respondent] was pressured to resign for
two different and contradictory reasons, namely, cost-cutting and
the need for a Chinese[-]speaking credit officer, for which no
written advice was given despite complainant’s request. Such
wavering stance or vacillating position indicates bad faith and a
dishonest purpose. Second, she was employed on account of her
qualifications, experience and readiness for the position of credit
officer and pressured to resign a month after she was commended
for her good work. Third, the demand for [respondent’s] instant
resignation on 19 April 1999 to give way to her replacement who
was allegedly reporting soonest, is whimsical, fraudulent and in
bad faith, because on 16 April 1999 she was given a period of [sic]
until 15 May 1999 within which to leave. Fourth, the pressures
made on her to resign were highly oppressive, anti-social and
caused her absolute torture, as [petitioners] disregarded her
situation as an overseas worker away from home and family, with
no prospect for another job. She was not even provided with a
return trip fare. Fifth, the notice of termination is an utter
manifestation of bad faith and whim as it totally disregards
[respondent’s] right to security of tenure and due process. Such
notice together with the demands for [respondent’s] resignation
contravenes the fundamental guarantee and public policy of the
Philippine government on security of tenure.
“[Respondent] likewise established that as a proximate result
of her dismissal and prior demands for resignation, she suffered
and continues to suffer mental anguish, fright, serious anxiety,
besmirched reputation, wounded feelings, moral shock and social
humiliation. Her standing in the social and business community
as well as prospects for employment with other entities have been
adversely affected by her dismissal. [Petitioners] are thus liable
for moral damages under Article 2217 of the Civil Code.
x x x      x x x      x x x
“[Petitioners] likewise acted in a wanton, oppressive or
malevolent manner in terminating [respondent’s] employment
and are therefore liable for exemplary damages. This should
served [sic] as protection to other employees of [petitioner]
company, and by way of example or correction for the public good
so that persons similarly

536

536 SUPREME COURT REPORTS ANNOTATED

Philippine National Bank vs. Cabansag

minded as 36[petitioners] would be deterred from committing the

same acts.”

The Court also affirms the award of attorney’s fees. It is

settled that when an action is instituted for the recovery of
wages, or when employees are forced to litigate and
 consequently incur expenses to protect their rights and 37
interests, the grant of attorney’s fees is legally justifiable.
WHEREFORE, the Petition is DENIED and the assailed
Decision and Resolution AFFIRMED. Costs against
petitioner.
SO ORDERED.

          Sandoval-Gutierrez, Corona, Carpio-Morales and

Garcia, JJ., concur.

Petition denied, assailed decision and resolution

affirmed.

Note.—In cases of illegal dismissal, the burden is on the

employer to prove that there was a valid ground for
dismissal. (Medenilla vs. Philippine Veterans Bank, 328
SCRA 1 [2000])

——o0o——

_______________

36 Labor Arbiter Joel S. Lustria’s Decision, pp. 9-12; Rollo, pp. 70-73.
(Citations omitted).
37 Philippine National Construction Corp. v. National Labor Relations
Commission, 342 Phil. 769; 277 SCRA 91, August 11, 1997.

537

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