493 Phil. 527
CALLEJO, SR., J.:
CONTRACT FROM | DURATION TO | POSITION | VESSEL | COMPANY |
13 Feb 70 | 10 Feb 71 | SN/Wiper | Esso Bataan | ETI[2] |
07 May 71 | 27 May 72 | Wiper | Esso Yokohama | EEM[3] |
07 Aug 72 | 02 Jul 73 | Oiler | Esso Kure | EEM |
03 Oct 73 | 30 Jun 74 | Oiler | ||
18 Sep 74 | 26 July 75 | Oiler | Esso Yokohama | EEM |
23 Oct 75 | 22 Jun 76 | Oiler | Esso Port Dickson | EEM |
10 Sep 76 | 26 Dec 76 | Oiler | Esso Bangkok | ETI |
27 Dec 76 | 29 Apr 77 | Temporary Jr. 3AE | Esso Bangkok | ETI |
08 Jul 77 | 15 Mar 78 | Jr. 3AE | Esso Bombay | ETI |
03 Jun 78 | 03 Feb 79 | Temporary Jr. 3AE | Esso Hongkong | ETI |
04 Apr 79 | 24 Jun 79 | 3AE | Esso Orient | EEM |
25 Jun 79 | 16 Jul 79 | 3AE | Esso Yokohama | EEM |
17 Jul 79 | 05 Dec 79 | 3AE | Esso Orient | EEM |
10 Feb 80 | 25 Oct 80 | 3AE | Esso Orient | EEM |
19 Jan 81 | 03 Jun 81 | 3AE | Esso Port Dickson | EEM |
04 Jun 81 | 11 Sep 81 | 3AE | Esso Orient | EEM |
06 Dec 81 | 20 Apr 82 | 3AE | Esso Chawan | EEM |
21 Apr 82 | 01 Aug 82 | Temporary 2AE | Esso Chawan | EEM* |
03 Nov 82 | 06 Feb 83 | 2AE | Esso Jurong | EEM |
07 Feb 83 | 10 Jul 83 | 2AE | Esso Yokohama | EEM |
31 Aug 83 | 13 Mar 84 | 2AE | Esso Tumasik | EEM |
04 May 84 | 08 Jan 85 | 2AE | Esso Port Dickson | EEM |
13 Mar 85 | 31 Oct 85 | 2AE | Esso Castellon | EEM |
29 Dec 85 | 22 Jul 86 | 2AE | Esso Jurong | EIS[4] |
13 Sep 86 | 09 Jan 87 | 2AE | Esso Orient | EIS |
21 Mar 87 | 15 Oct 87 | 2AE | Esso Port Dickson | EIS |
20 Nov 87 | 18 Dec 87 | 1AE | Esso Chawan | EIS |
19 Dec 87 | 25 Jun 88 | 2AE | Esso Melbourne | EIS |
04 Aug 88 | 19 Mar 89 | Temporary 1AE | Esso Port Dickson | EIS |
20 Mar 89 | 19 May 89 | 1AE | Esso Port Dickson | EIS* |
28 Jul 89 | 17 Feb 90 | 1AE | Esso Melbourne | EIS |
16 Apr 90 | 11 Dec 90 | 1AE | Esso Orient | EIS |
09 Feb 91 | 06 Oct 91 | 1AE | Esso Melbourne | EIS |
16 Dec 91 | 22 Aug 92 | 1AE | Esso Orient | EIS |
… Because of his unsteady gait, pronounced limp, and loss of normal dexterity of his leg and foot, we doubted whether Mr. Ravago can physically tackle the usual activities of a seaman in the course of his work without any added risk over and above the ordinary or standard risk inherent to his job. These activities include climbing up and down the engine room through a long flight of iron stairs with narrow steps which could be slippery at times due to grease or oil, jumping from an unsteady and floating motor launch or boat to board or alight a tanker through a flight of steps or climbing up and down a pilot ladder, wearing of heavy safety shoes, etc.Consequently, instead of rehiring Ravago, EIS paid him his Career Employment Incentive Plan (CEIP)[12] as of March 1, 1993 and his final tax refund for 1992. After deducting his Social Security System and medical contributions from November 1992 to February 1993, EIS remitted the net amount of P162,232.65, following Ravago’s execution of a Deed of Quitclaim and/or Release.[13]
Mr. Ravago’s doctor replied that, after being informed about the nature of the job, he believes that Mr. Ravago would not be able to cope with these kinds of activities. In effect, the Orthopedic doctor said Mr. Ravago is not fit to go back to his work as a seaman.
We concur with the opinion of the doctor that Mr. Ravago is not fit to go back to his job as a seaman in view of the risk of physical injury to himself as result of the deformity and loss of dexterity of his injured leg.
As a seaman, we consider his inability partial permanent. His injury corresponds to Grade 13 in the Schedule of Disability of the Standard Employment Contract. …[11]
WHEREFORE, premises considered, judgment is hereby rendered finding the dismissal illegal and ordering respondents to reinstate complainant to his former position without loss of seniority rights and other benefits. Further, the respondents are jointly and severally liable to pay complainant backwages from the time of his dismissal up to the promulgation of this decision. Such backwages is provisionally fixed at US$96,285.00 less the P162,285.83 (sic) paid to the complainant as Career Employment Incentive Plan. And ordering respondents to pay complainant 10% of the total monetary award as attorney’s fees.Aggrieved, the respondents appealed the decision to the National Labor Relations Commission (NLRC) on July 3, 1997, raising the following grounds:
All other claims are dismissed for lack of merit.
SO ORDERED.[17]
THE DECISION IS VITIATED BY SERIOUS ERRORS IN THE FINDINGS OF FACT WHICH, IF NOT CORRECTED, WOULD CAUSE GRAVE OR IRREPARABLE DAMAGE OR INJURY TO THE RESPONDENTS. THESE FINDINGS ARE:On April 26, 2001, the NLRC rendered a decision affirming that of the Labor Arbiter. The NLRC based its decision in the case of Millares v. National Labor Relations Commission,[19] wherein it was held that:
- THAT COMPLAINANT WAS A REGULAR EMPLOYEE BECAUSE HE WAS HIRED AND REHIRED IN VARIOUS CAPACITIES ON BOARD ESSO VESSELS IN A SPAN OF 23 YEARS;
- THAT COMPLAINANT WAS A REGULAR EMPLOYEE BECAUSE HE WAS ENGAGED IN THE SERVICES INDISPENSABLE IN THE OPERATION OF THE VARIOUS VESSELS OF RESPONDENTS;
- THAT COMPLAINANT WAS FIT TO RESUME PRE-INJURY ACTIVITIES AND HIS FRACTURE COMPLETELY HEALED NOTWITHSTANDING A CONTRARY MEDICAL OPINION OF COMPLAINANT’S OWN PHYSICIAN AND RESPONDENTS’ COMPANY PHYSICIAN; AND
- THAT COMPLAINANT WAS ILLEGALLY DISMISSED BY RESPONDENTS.[18]
It is, likewise, clear that petitioners had been in the employ of the private respondents for 20 years. The records reveal that petitioners were repeatedly re-hired by private respondents even after the expiration of their respective eight-month contracts. Such repeated re-hiring which continued for 20 years, cannot but be appreciated as sufficient evidence of the necessity and indispensability of petitioners’ service to the private respondents’ business or trade.The NLRC, likewise, declared that Ravago was illegally dismissed and that the quitclaim executed by him could not be considered as a waiver of his right to question the validity of his dismissal and seek reinstatement and other reliefs. According to the NLRC, such quitclaim is against public policy, considering the economic disadvantage of the employee and the inevitable pressure brought about by financial capacity.
Verily, as petitioners had rendered 20 years of service, performing activities which were necessary and desirable in the business or trade of private respondents, they are, by express provision of Article 280 of the Labor Code, considered regular employees.[20]
WHEREFORE, the petition is GRANTED. The assailed decisions of the NLRC are hereby REVERSED and SET ASIDE and the injunctive writ issued on November 14, 2001, is hereby made PERMANENT.The CA ratiocinated as follows:
SO ORDERED.[25]
The employment, deployment, rights and obligation of Filipino seafarers are particularly set forth under the rules and regulations governing overseas employment promulgated by the POEA. Section C, Part I of the Standard Employment Contract Governing the Employment of All Filipino Seamen on Board Ocean-Going Vessels emphatically provides the following:The CA noted that the employment status of seafarers has been established with finality by the Court’s reconsideration of its decision in Millares v. National Labor Relations Commission,[27] wherein it was ruled that seamen are contractual employees. According to the CA, the fact that Ravago was not rehired upon the completion of his contract did not result in his illegal dismissal; hence, he was not entitled to reinstatement or payment of separation pay. The CA, likewise, affirmed the writ of preliminary injunction it earlier issued, declaring that an injunction is a preservative remedy issued for the protection of a substantive right or interest, an antidote resorted to only when there is a pressing necessity to avoid injurious consequences which cannot be rendered under any standard compensation.
“SECTION C. DURATION OF CONTRACTThe period of employment shall be for a fix (sic) period but in no case to exceed 12 months and shall be stated in the Crew Contract. Any extension of the Contract period shall be subject to the mutual consent of the parties.”It is clear from the foregoing that seafarers are contractual employees whose terms of employment are fixed for a certain period of time. A fixed term is an essential and natural appurtenance of seamen’s employment contracts to which, whatever the nature of the engagement, the concept of regular employment under Article 280 of the Labor Code does not find application. The contract entered into by a seafarer with his employer sets in detail the nature of his job, the amount of his wage and, foremost, the duration of his employment. Only a satisfactory showing that both parties dealt with each other on more or less equal terms with no dominance exercised by the employer over the seafarer is necessary to sustain the validity of the employment contract. In the absence of duress, as it is in this case, the contract constitutes the law between the parties.[26]
On the first issue, the petitioner asserts that the CA violated Article 254 of the Labor Code when it issued a temporary restraining order, and thereafter a writ of preliminary injunction, to derail the enforcement of the final and executory judgment of the Labor Arbiter as affirmed by the NLRC. On the other hand, the respondents contend that the issue has become academic since the CA had already decided the case on its merits.I.
[WHETHER OR NOT] THE COURT OF APPLEALS GRAVELY ERRED AND VIOLATED THE LABOR CODE WHEN IT ISSUED A RESTRAINING ORDER AND THEREAFTER A WRIT OF PRELIMINARY INJUNCTION IN CA-G.R. SP NO. 66234.II.
[WHETHER OR NOT] THE COURT OF APPEALS GRAVELY ERRED, [AND] BLATANTLY DISREGARDED THE CONSTITUTIONAL MANDATE ON PROTECTION TO FILIPINO OVERSEAS WORKERS, AND COUNTENANCED UNWARRANTED DISCRIMINATION WHEN IT RULED THAT PETITIONER CANNOT BECOME A REGULAR EMPLOYEE.[28]
The question immediately provoked ... is whether or not a voluntary agreement on a fixed term or period would be valid where the employee “has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer.” The definition seems non sequitur. From the premise – that the duties of an employee entail “activities which are usually necessary or desirable in the usual business or trade of the employer” — the conclusion does not necessarily follow that the employer and employee should be forbidden to stipulate any period of time for the performance of those activities. There is nothing essentially contradictory between a definite period of an employment contract and the nature of the employee’s duties set down in that contract as being “usually necessary or desirable in the usual business or trade of the employer.” The concept of the employee’s duties as being “usually necessary or desirable in the usual business or trade of the employer” is not synonymous with or identical to employment with a fixed term. Logically, the decisive determinant in term employment should not be the activities that the employee is called upon to perform, but the day certain agreed upon by the parties for the commencement and termination of their employment relationship, a day certain being understood to be “that which must necessarily come, although it may not be known when.” Seasonal employment, and employment for a particular project are merely instances of employment in which a period, were not expressly set down, is necessarily implied.[37]The Court made the same ruling in Coyoca v. National Labor Relations Commission[40] and declared that a seafarer, not being a regular employee, is not entitled to separation or termination pay....
Some familiar examples may be cited of employment contracts which may be neither for seasonal work nor for specific projects, but to which a fixed term is an essential and natural appurtenance: overseas employment contracts, for one, to which, whatever the nature of the engagement, the concept of regular employment with all that it implies does not appear ever to have been applied, Article 280 of the Labor Code notwithstanding; also appointments to the positions of dean, assistant dean, college secretary, principal, and other administrative offices in educational institutions, which are by practice or tradition rotated among the faculty members, and where fixed terms are a necessity without which no reasonable rotation would be possible. ... [38]...
Accordingly, and since the entire purpose behind the development of legislation culminating in the present Article 280 of the Labor Code clearly appears to have been, as already observed, to prevent circumvention of the employee’s right to be secure in his tenure, the clause in said article indiscriminately and completely ruling out all written or oral agreements conflicting with the concept of regular employment as defined therein should be construed to refer to the substantive evil that the Code itself has singled out: agreements entered into precisely to circumvent security of tenure. It should have no application to instances where a fixed period of employment was agreed upon knowingly and voluntarily by the parties, without any force, duress or improper pressure being brought to bear upon the employee and absent any other circumstances vitiating his consent, or where it satisfactorily appears that the employer and employee dealt with each other on more or less equal terms with no moral dominance whatever being exercised by the former over the latter. Unless, thus, limited in its purview, the law would be made to apply to purposes other than those explicitly stated by its framers; it thus becomes pointless and arbitrary, unjust in its effects and apt to lead to absurd and unintended consequences.[39]
Furthermore, petitioner’s contract did not provide for separation benefits. In this connection, it is important to note that neither does the POEA standard employment contract for Filipino seamen provide for such benefits.In the July 29, 2002 Resolution of this Court in Millares v. National Labor Relations Commission,[42] it reiterated its ruling that seafarers are contractual employees and, as such, are not covered by Article 280 of the Labor Code of the Philippines:
As a Filipino seaman, petitioner is governed by the Rules and Regulations Governing Overseas Employment and the said Rules do not provide for separation or termination pay. ......
Therefore, although petitioner may not be a regular employee of private respondent, the latter would still have been liable for payment of the benefits had the principal failed to pay the same. …[41]
From the foregoing cases, it is clear that seafarers are considered contractual employees. They cannot be considered as regular employees under Article 280 of the Labor Code. Their employment is governed by the contracts they sign every time they are rehired and their employment is terminated when the contract expires. Their employment is contractually fixed for a certain period of time. They fall under the exception of Article 280 whose employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season. We need not depart from the rulings of the Court in the two aforementioned cases which indeed constitute stare decisis with respect to the employment status of seafarers.The Court ruled that the employment of seafarers for a fixed period is not discriminatory against seafarers and in favor of foreign employers. As explained by this Court in its July 29, 2002 Resolution in Millares:...
... The Standard Employment Contract governing the Employment of All Filipino Seamen on Board Ocean-Going Vessels of the POEA, particularly in Part I, Sec. C, specifically provides that the contract of seamen shall be for a fixed period. And in no case should the contract of seamen be longer than 12 months. It reads:
Section C. Duration of ContractThe period of employment shall be for a fixed period but in no case to exceed 12 months and shall be stated in the Crew Contract. Any extension of the Contract period shall be subject to the mutual consent of the parties.…
Petitioners make much of the fact that they have been continually re-hired or their contracts renewed before the contracts expired (which has admittedly been going on for twenty [20] years). By such circumstance they claim to have acquired regular status with all the rights and benefits appurtenant to it.
Such contention is untenable. Undeniably, this circumstance of continuous re-hiring was dictated by practical considerations that experienced crew members are more preferred. Petitioners were only given priority or preference because of their experience and qualifications but this does not detract the fact that herein petitioners are contractual employees. They can not be considered regular employees. We quote with favor the explanation of the NLRC in this wise:xxx The reference to “permanent” and “probationary” masters and employees in these papers is a misnomer and does not alter the fact that the contracts for enlistment between complainants-appellants and respondent-appellee Esso International were for a definite periods of time, ranging from 8 to 12 months. Although the use of the terms “permanent” and “probationary” is unfortunate, what is really meant is “eligible for-re-hire.” This is the only logical conclusion possible because the parties cannot and should not violate POEA’s requirement that a contract of enlistment shall be for a limited period only; not exceeding twelve (12) months.From all the foregoing, we hereby state that petitioners are not considered regular or permanent employees under Article 280 of the Labor Code. Petitioners’ employment have automatically ceased upon the expiration of their contracts of enlistment (COE). Since there was no dismissal to speak of, it follows that petitioners are not entitled to reinstatement or payment of separation pay or backwages, as provided by law. …[43]
Moreover, it is an accepted maritime industry practice that employment of seafarers are for a fixed period only. Constrained by the nature of their employment which is quite peculiar and unique in itself, it is for the mutual interest of both the seafarer and the employer why the employment status must be contractual only or for a certain period of time. Seafarers spend most of their time at sea and understandably, they can not stay for a long and an indefinite period of time at sea. Limited access to shore society during the employment will have an adverse impact on the seafarer. The national, cultural and lingual diversity among the crew during the COE is a reality that necessitates the limitation of its period.[44]In Pentagon International Shipping, Inc. v. William B. Adelantar,[45] the Court cited its rulings in Millares and Coyoca and reiterated that a seafarer is not a regular employee entitled to backwages and separation pay:
Therefore, Adelantar, a seafarer, is not a regular employee as defined in Article 280 of the Labor Code. Hence, he is not entitled to full backwages and separation pay in lieu of reinstatement as provided in Article 279 of the Labor Code. As we held in Millares, Adelantar is a contractual employee whose rights and obligations are governed primarily by [the] Rules and Regulations of the POEA and, more importantly, by R.A. 8042, or the Migrant Workers and Overseas Filipinos Act of 1995.The latest ruling of the Court in Marcial Gu-Miro v. Rolando C. Adorable and Bergesen D.Y. Manila[46] reaffirmed yet again its rulings that a seafarer is employed only on a contractual basis:
Clearly, petitioner cannot be considered as a regular employee notwithstanding that the work he performs is necessary and desirable in the business of respondent company. As expounded in the above-mentioned Millares Resolution, an exception is made in the situation of seafarers. The exigencies of their work necessitates that they be employed on a contractual basis.The petitioner failed to convince the Court why it should restate its decision in Millares and reverse its July 29, 2002 Resolution in the same case.
Thus, even with the continued re-hiring by respondent company of petitioner to serve as Radio Officer onboard Bergesen’s different vessels, this should be interpreted not as a basis for regularization but rather a series of contract renewals sanctioned under the doctrine set down by the second Millares case. If at all, petitioner was preferred because of practical considerations – namely, his experience and qualifications. However, this does not alter the status of his employment from being contractual.