Sunace International Management Services Inc. vs NLRC (G.R. No.

16157, January 25, 2006)

Facts: Respondent Divina Montehermozo was hired by Taiwanese employer
Sunace International Management Services (Sunace) as a domestic helper
on a one-month contract. This employment was arranged with the help of
Taiwanese broker Edmund Wang. After the contract's expiration,
Montehermozo continued working for her Taiwanese employer for an
additional two years. When Montehermozo got back to the Philippines, she
complained to the National Labor Relations Commission about Sunace Wang
and her Taiwanese employer. She claims she was underpaid and spent three
months in jail in Taiwan. She also claims that Sunace knew about and
consented to the two-year extension of her employment contract. On the
other hand, Sunace refuted all of the charges. The National Labor Relations
Commission and Court of Appeals upheld the Labor Arbiter's decision, which
led to the filing of this appeal. The Labor Arbiter decided in favor of
Montehermozo and found Sunace responsible for it.
Issue: Whether Sunace was informed and given her approval before the 1-
year extension of Montehermozo's employment?
Held: When the foreign principal directly bargained with the employee and
entered into a new and distinct employment contract after the initial
employment contract was terminated, there is an implied revocation of an
agency relationship. Contrary to what the Court of Appeals determined, the
foreign employer was not the subject of the alleged continuous
communication; rather, it was with Taiwanese broker Wang. The Court of
Appeals erred in concluding that Sunace was continuously in contact with the
foreign principal and, as a result, was aware of and had consented to the
execution of the contract extension because of Wang's telefax message to
Sunace. The message doesn't offer any proof that Sunace was aware of the
new contract that was signed after the original contract expired on February
1, 1998. Sunace did not necessarily approve the contract extension just
because the Taiwanese broker and Sunace spoke about Montehermozo's
allegedly withheld savings. As is clear from that letter communication,
Sunace was simply informed that Montehermozo had already taken her
savings from her foreign employer and that no deduction had been made
from her pay. It doesn't mention the extension or Sunace's approval of it.
The telefax message was sent to Sunace, who was required to appear on
February 28 for a mandatory conference as a result of Montehermozo's filing
of the complaint on February 14, 2000, according to a summons that was
issued on February 15, 2000, and it is safe to assume that since the
message is dated February 21, 2000, it was intended to inform Sunace of
this requirement. Regarding the Court of Appeals' ruling, Sunace cannot
claim ignorance of the extension because, obviously, its principal's act of
extending Montehermozo's employment contract necessarily bound it; this is
also an incorrect application of the theory of imputed knowledge. According
to the theory of imputed knowledge, employer is the principal and Sunace is
the agent, not the other way around. Therefore, Sunace, the principal-
foreign employer's agent, cannot be accused of knowing about it. Sunace
cannot be said to have been privy to the 2-year employment contract
extension because there is insufficient evidence showing that it was aware of
it and gave its consent to be bound by it. Due to this, it cannot be held
jointly and severally liable with its owner for any of Montehermozo's claims
resulting from the 2-year employment extension. Contracts only have legal
force between the parties, their appointed representatives, and heirs,
according to the New Civil Code, unless there is a specific legal provision
that prevents the rights and obligations arising from the contract from being
passed on. Sunace is correct in pointing out that when the foreign principal
directly negotiated with Montehermozo and signed a new and distinct
employment contract in Taiwan following the termination of the initial
employment contract, there was an implied revocation of Sunace's agency
relationship with the principal. According to Article 1924 of the New Civil
Code, the agency is revoked if the principal manages the business that was
given to the agent directly, interacting with third parties.
General Milling Corporation vs. Torres (G.R. No. 9366, April 22,
1991)
Facts: Earl Cone, a US citizen, was granted an alien employment permit by
the NCR-Dept. of Labor and Employment in May 1989 to work as a sports
consultant and assistant coach for GMC. Dec. 1989 saw the signing of an
employment contract between GMC and Cone. Then, in January 1990,
Cone's request for a change of admission status from temporary visitor to
the pre-arranged employee was approved by the board of special inquiry of
the commission and deportation. Cone's alien employment permit was
renewed in February 1990 at the request of GMC, which the DOLE regional
director approved. The employment with an alien is valid through December
1990. Private respondent BCAP appealed the issuance of the said alien
employment permit to the secretary of labor, who made a determination
ordering the cancellation of Cone's employment permit on the grounds that
there was no proof that no one in the Philippines was qualified, willing, and
able to provide the necessary services or that Cone's hiring served the
interests of the country.

Acting Secretary Laguesma rejected both of GMC's motions for

reconsideration and two supplemental motions for reconsideration.
Issue: The Secretary of Labor allegedly committed a grave abuse of
discretion when he revoked the alien employment permit, according to GMC,
which is the case in front of the court on a petition for certiorari.
Ruling: Petition dismissed. The court believes that the petitioners have not
demonstrated any serious abuse of the secretary's discretion. When
petitioners were given permission to submit their motion for reconsideration
before the secretary of labor, the alleged oversight of notifying them of the
appeal filed by BCAP was remedied. There is absolutely no legal support for
GMC's assertion that it is an employer's right to hire a foreign coach. For
non-resident aliens, as defined in article 40 of the labor code, an
employment permit is necessary before hiring a foreign national. Because
the Labor Code requires an alien employment permit in order to enter an
employment contract with a foreign national, GMS cannot assert that the
Secretary's decision would amount to an impairment of contractual
obligations. According to GMC, the Secretary of Labor ought to have
respected the Comm's conclusions. Concerning Immigration and
Deportation, there is also no justification for Cone's employment. The labor
code expressly gives the secretary the authority to decide whether a
person's services are available in the Philippines.

WPD Marketing vs. Jocelyn Galera (G.R. No. 169207, March 25,
2010)
Facts: Petitioner Jocelyn Galera (GALERA) is an American citizen who was
hired to work in the Philippines for private respondent WPP Marketing
Communications, Inc. (WPP), a company registered and operating under
Philippine law, by private respondent John Steedman, Chairman-WPP
Worldwide and Chief Executive Officer of Mindshare, Co., a company based
in Hong Kong, China. Upon the CEO's instruction and the CEO's signing of
the contract, GALERA's employment with private respondent WPP became
effective on September 1, 1999. The Board of Directors of private
respondent WPP took no further action. Four months had passed when
private respondent WPP submitted an application for petitioner GALERA to
be granted a working visa to the Bureau of Immigration, listing her as the
Vice President of WPP. The petitioner claimed that in order for her to stay in
the Philippines and keep her job, she was forced to sign the application.
Petitioner GALERA claimed that on December 14, 2000, private respondent
STEEDMAN informed her verbally that her services with private respondent
WPP had been terminated. The next day, a letter of termination was
received. So, a claim of unlawful termination was made against WPP. The LA
ruled that WPP, Steedman, Webster, and Lansang were responsible for the
damages caused by the illegal dismissal. Galera, according to Arbiter
Madriaga, was not only fired without cause but also without following the
law. The LA ruling was overturned by the NLRC. Galera was WPP's Vice-
President at the time that she was terminated by the Board of Directors,
according to the NLRC, making her a corporate officer. Due to the fact that
Galeras was a corporate officer at the time of her removal, we are required
by the law to hold that the Arbiter below lacked jurisdiction over Galeras'
case.
Issue: Whether or not the LA has jurisdiction over the case?
Ruling: The president, secretary, treasurer, and any other officers specified
in the bylaws are referred to as corporate officers under Section 25 of the
Corporation Code. According to an analysis of WPP's bylaws, Galera's
appointment as a corporate officer (Vice-President with the operational title
of Managing Director of Mindshare) at a special meeting of the board of
directors of WPP is an appointment to an inactive corporate office. The
bylaws of WPP only allowed for one vice president. The WPP already had one
Vice-President at the time of Galera's appointment on December 31, 1999,
and his name was Webster. Due to the fact that each of the five directorship
positions specified in the bylaws is already filled, Galera cannot be
considered a director of WPP. Finally, WPP cannot assert that Galera is a
corporate officer based on its Amended By-Laws. The amended bylaws
included provisions for two additional directors and more than one vice
president. Even though WPP's stockholders approved the amendment on
May 31, 2000, the SEC didn't approve it until February 16, 2001. Galera was
fired on December 14th, 2000. No proof was provided by WPP, Steedman,
Webster, or Lansang that Galeras' dismissal was the result of a decision
made by the WPP Board of Directors. The Labor Arbiter and the NLRC have
jurisdiction over the current case because Galera is an employee. Galera was
fired by WPP without following the law in both substance and procedure. The
law further stipulates that the employer must provide the worker sought to
be dismissed with two written notices before termination of employment can
be legally effected: (1) notice which apprises the employee of the specific
acts or omissions for which his dismissal is sought; and (2) the subsequent
notice which informs the employee of the reasons for his dismissal. Apart
from Steedman's letter dated 15 December 2000 to Galera, WPP failed to
prove any just or authorized cause for Galera's dismissal. The dismissal
becomes unlawful if the requirements are not met. The actions of WPP amply
demonstrate that Galera's dismissal did not adhere to the two-notice
requirement. Prior to beginning employment, the employment permit must
be obtained. The requirement that the employment permit be obtained prior
to employment is consistent with both the law and the regulations. Any alien
seeking entry into the Philippines for employment-related reasons must
obtain an employment permit from the Department of Labor, according to
the Labor Code, as well as any domestic or foreign employer who wishes to
hire an alien for employment in the Philippines. Galera is not allowed to enter
this court with dirty hands. Granting the prayer of Galeras would be
equivalent to endorsing a violation of the Philippine labor laws, which
demand that foreigners obtain work permits prior to employment. We
conclude that in this instance, the status quo must apply, and we leave the
parties in their current positions. Galera is therefore not eligible for financial
rewards. Galera is still free to seek relief from other jurisdictions despite this
decision.
Nitto Enterprises vs NLRC (G.R. No. 114337, September 29, 1995)
Facts: Capili was employed as an apprentice machinist by petitioner Nito
Enterprises for a period of six months at a daily rate equal to 75% of the
applicable minimum wage. To the financial detriment of the company as his
medical expenses would be covered by Nito Enterprises, Capili was asked to
resign less than two months after he started work for the reasons that he
had been causing accidents, that he had been going above and beyond the
call of duty, and that he had even injured himself while handling one of the
machines. Later, Capili brought a claim of wrongful termination, but the
Labor Arbiter rejected it. The NLRC overturned this judgment and declared
Capili to be a regular employee. Nito approached the Supreme Court with
this in hand. Nito Enterprises challenges the NLRC's ruling on the grounds
that no application for and approval of an apprenticeship program had been
made at the time the agreement was signed.
Issue: Is Capili a regular employee or an apprentice?
Ruling: Capili works on a regular basis. Without prior DOLE approval, an
apprentice will eventually become a regular employee. Petitioner failed to
follow the rules set forth by the law. Apprenticeship agreements must be
entered into only in accordance with the apprenticeship program that has
been properly approved by the Minister of Labor and Employment.
Therefore, before an apprenticeship agreement can be validly entered into,
the proposed apprenticeship program must first receive prior approval from
the Department of Labor and Employment. The Department of Labor and
Employment must be notified of the proposed apprenticeship program before
it can be approved; however, this does not immediately establish an
employer-apprentice relationship. Therefore, the private respondent's claim
that he was hired not as an apprentice but as a delivery boy or "kargador" or
"pahinante” deserves credence because the apprenticeship agreement
between the petitioner and private respondent is null and void in the
absence of a legitimate apprenticeship program duly approved by the DOLE.
According to Article 280 of the Labor Code and the constitutional mandate to
uphold and protect workers' rights, he should be regarded as a regular
employee of the petitioner.

Filamer Christian Institute vs. Intermediate Appellate Court (G.R.

No. 75112, August 17, 1992)
Facts: Kapunan, Sr., a retired teacher who was 82 years old, was hit by a
jeepney driven by Funtecha, an alleged employee of Filamer Christian
Institute. Kapunan spent 20 days in the hospital. As a result, he brought a
criminal case against Funtecha alone, who was found guilty of causing
serious physical harm through careless imprudence. Kapunan then filed a
civil lawsuit for damages against Funtecha, Filamer, and its president in
accordance with his reservation. The school, Filamer, was found to be
responsible for damages by the RTC and CA. this petition, it follows. As
Funtecha was only a working student assigned to clean the school grounds
for only two hours each morning of the school day, Filamer claims that it is
not legally responsible for his actions. The Labor Code's Section 14, Rule X,
which excludes working scholars from employment coverage in terms of the
substantive labor laws governing working conditions, rest periods, and
wages, serves as the foundation for Filamer's argument.
Issue: Is Funtecha an employee of Filamer?
Ruling: Yes, it is undeniable that Funtecha was a full-time student who also
worked as a part-time janitor for petitioner Filamer. Even though he was
only tasked with cleaning the school's facilities for two (2) hours each
morning, he was still considered an employee in the eyes of the school.
Funtecha was not exactly enjoying the ride as she was learning to drive and
heading home toward Allan's house. Funtecha was operating the vehicle for
the petitioner school's intended use of the jeep, not for his personal
amusement or a frolic of his own. As a result, the Court is forced to draw the
conclusion that Funtecha's act of taking the wheel was one performed for
and on behalf of his employer, for which the petitioner-school cannot escape
liability by claiming that it was outside the purview of his janitorial duties.
Section 14, Rule X, Book III of the Rules implementing the Labor Code, on
which the petitioner anchors its defense, was promulgated by the Secretary
of Labor and Employment only for the purpose of administering and
enforcing the provisions of the Labor Code on conditions of employment.
Particularly, Rule X of Book III provides guidelines on the manner by which
the powers of the Labor Secretary shall be exercised; on what records
should be kept; maintained and preserved; on payroll; and on the exclusion
of working scholars from, and inclusion of resident physicians in the
employment coverage as far as compliance with the substantive labor
provisions on working conditions, rest periods, and wages, is concerned. In
other words, Rule X merely serves as a manual for enforcing the substantive
labor law. The Court thus draws a distinction, holding that Section 14, Rule
X, Book III of the Rules is not the controlling law in a civil lawsuit for
damages brought by a person injured in a car accident against a working
student of a school as well as against the school itself. The current case does
not involve a labor dispute over working conditions between a purported
employee and a purported employer. It evokes a claim for damages for
harm sustained as a result of a person's obviously negligent actions, which is
made against both the doer-employee and his employer. Therefore, it is
inappropriate to ignore an employer's primary liability under Article 2180 of
the Civil Code by relying solely on the labor implementation rule. An
employer cannot use a labor implementing rule as a defense to escape
responsibility under the Civil Code's substantive provisions.