1. People v.
Panis, L-58674-77, July 11, 1986 government license or authority are guilty of illegal recruitment whether or not they
On January 9, 1981, four information were filed in the in the Court of First Instance
(CFI) of Zambales and Olongapo City alleging that herein private respondent Serapio
Abug, "without first securing a license from the Ministry of Labor as a holder of
authority to operate a fee-charging employment agency, did then and there wilfully,
unlawfully and criminally operate a private fee charging employment agency by
charging fees and expenses (from) and promising employment in Saudi Arabia" to
four separate individuals. Abug filed a motion to quash contending that he cannot be
charged for illegal recruitment because according to him, Article 13(b) of the Labor
Code says there would be illegal recruitment only "whenever two or more persons are
in any manner promised or offered any employment for a fee.”
Denied at first, the motion to quash was reconsidered and granted by the Trial Court
in its Orders dated June 24, 1981, and September 17, 1981. In the instant case, the
view of the private respondents is that to constitute recruitment and placement, all the
acts mentioned in this article should involve dealings with two or more persons as an
indispensable requirement. On the other hand, the petitioner argues that the
requirement of two or more persons is imposed only where the recruitment and
placement consists of an offer or promise of employment to such persons and always
in consideration of a fee.
ISSUE: Whether or not Article 13(b) of the Labor Code provides for the innocence or
guilt of the private respondent of the crime of illegal recruitment
COURT RULING:
The Supreme Court reversed the CFI’s Orders and reinstated all four information filed
against private respondent.
The Article 13(b) of the Labor Code was merely intended to create a presumption,
and not to impose a condition on the basic rule nor to provide an exception thereto.
Where a fee is collected in consideration of a promise or offer of employment to two
or more prospective workers, the individual or entity dealing with them shall be
deemed to be engaged in the act of recruitment and placement. The words "shall be
deemed" create the said presumption.
2.Lazo v. Salac, G.R. No. 152642, November 13, 2012
PETITIONER: Hon. Patricia A. Sto. Tomas, Rosalinda Baldoz and Lucita Lazo
RESPONDENT: Rey Salac, Willie D. Espiritu, Mario Montenegro, Dodgie
Belonio, Lolit Salinel and Buddy
DOCTRINE: Illegal recruitment" as defined in Section 6 is clear and unambiguous
and, contrary
to the RTC’s finding, actually makes a distinction between licensed and non-licensed
recruiters. By its terms, persons who engage in "canvassing, enlisting, contracting,
transporting, utilizing, hiring, or procuring workers" without the appropriate
commit the wrongful acts enumerated in that section.
FACTS: Several cases were filed and consolidated questioning the constitutionality of
certain provisions of R.A 8042 otherwise known as the Migrant Workers and
Overseas Filipino Act of
1995 which sets the Government’s policies on overseas employment and establishes
a higher
standard of protection and promotion of the welfare of migrant workers, their families,
and overseas Filipinos in distress.
Republic Act 8042 was subsequently amended by R.A. 9422, which expressly
repealed Sections 29 and 30 of R.A. 8042 and adopted the policy of close
government regulation of the recruitment and deployment of OFWs.
On August 21, 1995 respondent Philippine Association of Service Exporters, Inc.
(PASEI) filed a petition for declaratory relief and prohibition with prayer for issuance of
TRO and writ of preliminary injunction before the RTC of Manila, seeking to annul,
among others, Section 6 of R.A. 8042 defining Illegal Recruitment for being
unconstitutional. It was contended that it is vague as it fails to distinguish between
licensed and non-licensed recruiters and for that reason gives undue advantage to
the non-licensed recruiters in violation of the right to equal protection of those that
operate with government licenses or authorities.The RTC of Manila declared Section
6 unconstitutional.
Issue: Whether or not the illegal recruitment definition should be declared
unconstitutional?
Ruling: No. Illegal Recruitment as defined in Section 6 is clear and unambiguous and,
contrary to the RTC’s finding, actually makes a distinction between licensed and non-
licensed recruiters. By its terms, persons who engage in "canvassing, enlisting,
contracting, transporting, utilizing, hiring, or procuring workers" without the
appropriate government license or authority are guilty of illegal recruitment whether or
not they commit the wrongful acts enumerated in that section. On the other hand,
recruiters who engage in the canvassing, enlisting, etc. of OFWs, although with the
appropriate government license or authority, are guilty of illegal recruitment only if
they commit any of the wrongful acts enumerated in Section 6.
Thus, Section 6 of R.A 8041 is constitutional.
3. Sunace International vs. NLRC G.R. No. 161757, January 25, 2006
There is an implied revocation of an agency relationship when after the termination of
the original employment contract, the foreign principal directly negotiated with the
employee and entered into a new and separate employment contract.

Respondent Divina Montehermozo is a domestic helper deployed to Taiwan by
Sunace International Management Services (Sunace) under a 12-month contract.
Such employment was made with the assistance of Taiwanese broker Edmund
Wang. After the expiration of the contract, Montehermozo continued her employment
with her Taiwanese employer for another 2 years.
When Montehermozo returned to the Philippines, she filed a complaint against
Sunace, Wang, and her Taiwanese employer before the National Labor Relations
Commission (NLRC). She alleges that she was underpaid and was jailed for three
months in Taiwan. She further alleges that the 2-year extension of her employment
contract was with the consent and knowledge of Sunace. Sunace, on the other hand,
denied all the allegations.
The Labor Arbiter ruled in favor of Montehermozo and found Sunace liable thereof.
The National Labor Relations Commission and Court of Appeals affirmed the labor
arbiter’s decision. Hence, the filing of this appeal.
ISSUE:
Whether or not the 2-year extension of Montehermozo’s employment was made with
the knowledge and consent of Sunace
HELD:
Contrary to the Court of Appeals finding, the alleged continuous communication was
with the Taiwanese broker Wang, not with the foreign employer.
The finding of the Court of Appeals solely on the basis of the telefax message written
by Wang to Sunace, that Sunace continually communicated with the foreign
“principal” (sic) and therefore was aware of and had consented to the execution of the
extension of the contract is misplaced. The message does not provide evidence that
Sunace was privy to the new contract executed after the expiration on February 1,
1998 of the original contract. That Sunace and the Taiwanese broker communicated
regarding Montehermozo’s allegedly withheld savings does not necessarily mean that
Sunace ratified the extension of the contract.
As can be seen from that letter communication, it was just an information given to
Sunace that Montehermozo had taken already her savings from her foreign employer
and that no deduction was made on her salary. It contains nothing about the
extension or Sunace’s consent thereto.
Parenthetically, since the telefax message is dated February 21, 2000, it is safe to
assume that it was sent to enlighten Sunace who had been directed, by Summons
issued on February 15, 2000, to appear on February 28, 2000 for a mandatory
conference following Montehermozo’s filing of the complaint on February 14, 2000.
Respecting the decision of Court of Appeals following as agent of its foreign principal,
[Sunace] cannot profess ignorance of such an extension as obviously, the act of its
principal extending [Montehermozo’s] employment contract necessarily bound it, it too
is a misapplication, a misapplication of the theory of imputed knowledge.
The theory of imputed knowledge ascribes the knowledge of the agent, Sunace, to
the principal, employer, not the other way around. The knowledge of the principal-
foreign employer cannot, therefore, be imputed to its agent Sunace.
There being no substantial proof that Sunace knew of and consented to be bound
under the 2-year employment contract extension, it cannot be said to be privy thereto.
As such, it and its “owner” cannot be held solidarily liable for any of Montehermozo’s
claims arising from the 2-year employment extension. As the New Civil Code
provides, Contracts take effect only between the parties, their assigns, and heirs,
except in case where the rights and obligations arising from the contract are not
transmissible by their nature, or by stipulation or by provision of law.
Furthermore, as Sunace correctly points out, there was an implied revocation of its
agency relationship with its foreign principal when, after the termination of the original
employment contract, the foreign principal directly negotiated with Montehermozo and
entered into a new and separate employment contract in Taiwan. Article 1924 of the
New Civil Code states that the agency is revoked if the principal directly manages the
business entrusted to the agent, dealing directly with third persons.
4.Serrano v. Gallant, G.R. No. 167614, March 24, 2009
FACTS:
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
On March 19, 1998, the date of his departure, petitioner was constrained to accept a
downgraded employment contract for the position of Second Officer with a monthly
salary of US$1,000.00, upon the assurance and representation of respondents that
he would be made Chief Officer by the end of April 1998.
Respondents did not deliver on their promise to make petitioner Chief Officer. Hence,
petitioner refused to stay on as Second Officer and was repatriated to the Philippines
on May 26, 1998.

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 against respondents for
constructive dismissal and for payment of his money claims in the total amount of
US$26,442.73.
The LA rendered a Decision dated July 15, 1999, declaring the dismissal of petitioner
illegal and awarding him monetary benefits, to wit:
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 claims of the complainant for moral and exemplary damages are hereby
DISMISSED for lack of merit.
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 = computation of his monetary award
US$2,590.00/compensation per month.”
Respondents appealed to the National Labor Relations Commission (NLRC) to
question the finding of the LA that petitioner was illegally dismissed.
The NLRC modified the LA Decision and 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.
Petitioner filed a Motion for Partial Reconsideration, but this time he questioned the
constitutionality of the subject clause. The NLRC denied the motion.
Petitioner filed a Petition for Certiorari with the CA, reiterating the constitutional
challenge against the subject clause. After initially dismissing the petition on a
technicality, the CA eventually gave due course to it, as directed by this Court in its
Resolution which granted the petition for certiorari,filed by petitioner.
The CA affirmed the NLRC ruling on the reduction of the applicable salary rate;
however, the CA skirted the constitutional issue raised by petitioner.
His Motion for Reconsideration having been denied by the CA, petitioner brings his
cause to this Court on the following grounds:
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.
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.
The Court now takes up the full merit of the petition mindful of the extreme
importance of the constitutional question raised therein.
ISSUES:
Whether Section 10 (par 5) of RA 8042 is unconstitutional
Proper computation of the Lump-sum salary to be awarded to petitioner by reason of
his illegal dismissal
Whether the overtime and leave pay should form part of the salary basis in the
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.
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
Arguments of the Petitioner
For Antonio Serrano (petitioner), a Filipino seafarer, the last clause in the 5th
paragraph of Section 10, Republic Act (R.A.) No. 8042, violates the OFWs’
constitutional rights in that it impairs the terms of their contract, deprives them of
equal protection and denies them due process.
The Arguments of Respondents
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 July
15, 1995, its provisions could not have impaired petitioner’s 1998 employment
contract. Rather, R.A. No. 8042 having preceded petitioner’s contract, the provisions
thereof are deemed part of the minimum terms of petitioner’s employment, especially
on the matter of money claims, as this was not stipulated upon by the parties.
The Court’s Ruling:
First Issue
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 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, Article II and Section 3, 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.
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
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, Article III of
the Constitution.
Second Issue
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.
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.
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, 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.

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.
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.
5. Yap v. Thenamaris, G.R. No. 179532, May 30, 2011
Claudio S. Yap was employed as electrician of the vessel, M/T SEASCOUT by
Intermare Maritime Agencies, Inc. in behalf of its principal, Vulture Shipping Limited.
The contract of employment entered into by Yap and Capt. Francisco B. Adviento, the
General Manager of Intermare, was for a duration of 12 months. On 23 August 2001,
Yap boarded M/T SEASCOUT and commenced his job as electrician. However, on or
about 8 November 2001, the vessel was sold. The Philippine Overseas Employment
Administration (POEA) was informed about the sale on 6 December 2001 in a letter
signed by Capt. Adviento. Yap, along with the other crewmembers, was informed by
the Master of their vessel that the same was sold and will be scrapped.
Yap received his seniority bonus, vacation bonus, extra bonus along with the
scrapping bonus. However, with respect to the payment of his wage, he refused to
accept the payment of one-month basic wage. He insisted that he was entitled to the
payment of the unexpired portion of his contract since he was illegally dismissed from
employment. He alleged that he opted for immediate transfer but none was made. He
then filed a complaint for Illegal Dismissal with Damages and Attorney’s Fees before
the Labor Arbiter.
The LA rendered a decision in favor of petitioner, finding the latter to have been
constructively and illegally dismissed by respondents. The NLRC affirmed the
decision but held that instead of an award of salaries corresponding to nine months,
petitioner was only entitled to salaries for three months as provided under Section 10
of R.A. No. 8042. Petitioner however questions the award of wages and assails Sec.
10 of R.A. 8042 as unconstitutional.
ISSUE: Is the 5th par. Sec 10 of R.A. 8042 violative of substantive due process?
RULING: Yes. The Court declared in Serrano vs. Gallant Maritime that the clause “or
for three months for every year of the unexpired term, whichever is less” provided in
the 5th paragraph of Section 10 of R.A. No. 8042 is unconstitutional for being violative
of the rights of Overseas Filipino Workers (OFWs) to equal protection of the laws. In
an exhaustive discussion of the intricacies and ramifications of the said clause, this
Court, in Serrano, pertinently held:
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.
Moreover, this Court held therein that the subject clause does not state or imply any
definitive governmental purpose; hence, the same violates not just therein petitioner’s
right to equal protection, but also his right to substantive due process under Section
1, Article III of the Constitution.
6. Meralco vs. NLRC, G.R. No. 78763, July 12, 1989
FACTS
Private resondent, Apolinario Signo was dismissed from work by Meralco when it was
found out that he breached the trust of thpe company by making it appear that the
residence of one applicant for an electric service is within the serviceable area of
MEralco. The applicant’s residence was installed with electrical services thru Signo’s
maneuver, however, due to the fault of the Power sales division, the applicant-
consumer was not billed for a year.
ISSUE
Whether or not, the dismissal of Signo was a proper penalty for his acts.
RULING
The Court affirmed the decision of the Labor Arbiter in finding that Dismissal was a
drastic measure considering the length of service of to the Company by Signo, which
is 20 years, and the 2 awards he received for honesty from the employer. He was
ordered reinstated, thought without backwages for he is not at all faultless.
Further, it was held that in carrying out and interpreting the Labor Code's provisions
and its implementing regulations, the workingman's welfare should be the primordial
and paramount consideration. This kind of interpretation gives meaning and
substance to the liberal and compassionate spirit of the law as provided for in Article
4 of the New Labor Code which states that "all doubts in the implementation and
interpretation of the provisions of the Labor Code including its implementing rules and
regulations shall be resolved in favor of labor"
7. Juco vs. NLRC, G.R. No. 98107, Aug. 18, 1997
Facts: Benjamin C. Juco was hired as a project engineer of National Housing
Corporation (NHC) from November 16, 1970 to May 14, 1975. On May 14, 1975, he
was separated from the service for having been implicated in a crime of theft and/or
malversation of public funds. On March 25, 1977, Juco filed a complaint for illegal
dismissal against the NHC with the Department of Labor. On September 17, 1977,
the Labor Arbiter rendered a decision dismissing the complaint on the ground that the
NLRC had no jurisdiction over the case. Juco then elevated the case to the NLRC
which rendered a decision on December 28, 1982, reversing the decision of the Labor
Arbiter. NHC then appealed the NLRC decision before the Supreme Court and on
January 17, 1985 which petition the Court granted thereby setting aside the NLRC
decision and reinstating the labor arbiter’s decision of dismissing the case.
On January 6, 1989, Juco filed with the Civil Service Commission a
complaint for illegal dismissal, with preliminary mandatory injunction. On February 6,
1989, NHC moved for the dismissal of the complaint on the ground that the Civil
Service Commission has no jurisdiction over the case. CSC granted the motion to
dismiss on the ground of lack of jurisdiction.
On April 28, 1989, Juco filed with NLRC a complaint for illegal dismissal with
preliminary mandatory injunction against NHC. NLRC find NHC guilty of illegal
dismissal. On June 1, 1990, NHC filed its appeal before the NLRC and on March 14,
1991, the NLRC promulgated a decision which reversed the decision of Labor Arbiter
Manuel R. Caday on the ground of lack of jurisdiction.
Issue: Whether or not the NLRC committed grave abuse of discretion in holding that
petitioner is not governed by the Labor Code
Held: Yes. Under the laws then in force, employees of government-owned and/or
controlled corporations were governed by the Civil Service Law and not by the Labor
Code. Although in National Housing Corporation v. Juco, it was held that employees
of government-owned and/or controlled corporations, whether created by special law
or formed as subsidiaries under the general Corporation Law, are governed by the
Civil Service Law and not by the Labor Code, this ruling has been supplanted by the
1987 Constitution which states that the civil service embraces all branches,
subdivisions, instrumentalities, and agencies of the Government, including
government owned or controlled corporations with original charter. In National Service
Corporation (NASECO) v. National Labor Relations Commission, it was held that the
NLRC has jurisdiction over the employees of NASECO on the ground that it is the
1987 Constitution that governs because it is the Constitution in place at the time of
the decision. It was further held that the new phrase "with original charter" means that
government-owned and controlled corporations refer to corporations chartered by
special law as distinguished from corporations organized under the Corporation
Code. Thus, NASECO which had been organized under the general incorporation
statute and a subsidiary of the National Investment Development Corporation, which
in turn was a subsidiary of the Philippine National Bank, is excluded from the purview
of the Civil Service Commission. The above doctrine applies in this case. In the case
at bench, the National Housing Corporation is a government owned corporation
organized in 1959 in accordance with Executive Order No. 399, otherwise known as
the Uniform Charter of Government Corporation, dated January 1, 1959. Its shares of
stock are and have been one hundred percent (100%) owned by the Government
from its incorporation under Act 1459, the former corporation law. The government
entities that own its shares of stock are the Government Service Insurance System,
the Social Security System, the Development Bank of the Philippines, the National
Investment and Development Corporation and the People's Homesite and Housing
Corporation. Considering the fact that the NHA had been incorporated under Act
1459, the former corporation law, it is but correct to say that it is a government-owned
or controlled corporation whose employees are subject to the provisions of the Labor
Code. This observation is reiterated in the recent case of Trade Union of the
Philippines and Allied Services (TUPAS) v. National Housing
Corporation, where the SC held that the NHA is now within the jurisdiction of the
Department of Labor and Employment, it being a government-owned and/or
controlled corporation without an original charter. Furthermore, the Court previously
ruled that the workers or employees of the NHC (now NHA) undoubtedly have the
right to form unions or employee's organization and that there is no impediment to the
holding of a certification election among them as they are covered by the Labor Code.
8. Republic vs. CA, G.R. No. 87676, December 20, 1989
National Parks Development Committee (NPDC) was originally created in 1963 under
Executive Order No. 30, as the Executive Committee for the development of Quezon
Memorial, Luneta and other national parks. The Committee was registered with the
SEC as a non-stock and non-profit corporation.
However, in 1987, due to failure to comply with SEC requirements (i.e. to submit
General Information Sheet and Financial Statements from 1981 to 1987; to register its
Corporate Books; and to operate for a continuous period for at least 5 years since
1967) NPDC was attached to the Ministry of Tourism. Pursuant thereto, Civil Service
Commission notified NPDC that all appointments and other personnel actions shall be
submitted to the former.
The Rizal Park Supervisory Employees Association was organized, and it affiliated
with the Trade Union of the Philippines and Allied Service (TUPAS, for brevity) under
Certificate No. 1206. However, NPDC entered into a separate CBA with NPDCEA
(TUPAS Local Chapter No. 967), and NPDCSA (TUPAS Chapter No. 1206) for a
period of two (2) years. Pursuant thereto, these unions staged a strike alleging unfair
labor practices by NPDC.

Contention of the NPDC: The strike is illegal on ground that the strikers, being
government employees, the strikers have no right to strike, although they may form a
union.

Ruling of the Trial Court and CA: Complaint is dismissed for lack of jurisdiction, to wit:
(1) there exists an employer-employee relationship between NPDC and the strikers;
(2) the acts complained of falls under par 5, Art. 217, in relation to Art. 265 of the
Labor Code. Hence, the case properly falls under the jurisdiction of DOLE. On
appeal, CA affirmed the decision of the trial court.

ISSUE
Whether the petitioner, National Parks Development Committee (NPDC), is a
government agency, or a private corporation, for on this issue depends the right of its
employees to strike.

HELD
The NPDC is an agency of the government, not a government-owned or controlled
corporation.

Since NPDC is a government agency, its employees are covered by civil service rules
and regulations (Sec. 2, Article IX, 1987 Constitution). Its employees are civil service
employees (Sec. 14, Executive Order No. 180).

While NPDC employees are allowed under the 1987 Constitution to organize and join
unions of their choice, there is as yet no law permitting them to strike. In case of a
labor dispute between the employees and the government, Section 15 of Executive
Order No. 180 dated June 1, 1987 provides that the Public Sector Labor-
Management Council, not the Department of Labor and Employment, shall hear the
dispute. Clearly, the Court of Appeals and the lower court erred in holding that the
labor dispute between the NPDC and the members of the NPDSA is cognizable by
the Department of Labor and Employment.