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GR 163657 International Management Services/Marilyn Pascual vs Roel Logarta FACTS: Petitioner International Management Services (IMS), owned by Marilyn

Pascual, deployed respondent Roel Logarta to work for Petrocon in connection with services of Petrocon for Saudi Arabian Oil Company (Saudi Aramco). Logarta was hired as a Piping Designer for a period of 2 years commencing October 2, 1997. Saudi Aramco, due to changes in the general engineering services work forecast for 1998, reduced the originally allotted man-hours by 40%. Consequently, due to the considerable decrease in the work requirements of Saudi Aramco, Petrocon was constrained to reduce its personnel that were employed as piping designers, instrument engineers, inside plant engineers, etc., which totaled to some 73 personnel including herein respondent Logarta. On June 1, 1998, Petrocon gave respondent Logarta a written notice informing the latter that due to the lack of project works related to his expertise, he is given a 30-day notice of termination, and that his last day of work with Petrocon will be on July 1, 1998. Upon his return to the Philippines, respondent filed a complaint with the Regional Arbitration Branch VII, National Labor Relations Commission (NLRC), Cebu City, against petitioner as the recruitment agency which employed him for employment abroad. In filing the complaint, respondent sought to recover his unearned salaries covering the unexpired portion of his employment contract with Petrocon on the ground that he was illegally dismissed. Labor Arbiter ruled in favor of respondent. US$ 5,600 awarded to respondent as payment for wages for the unexpired portion. NLRC affirmed Labor Arbiters decision but modified the amount. US$ 4,800 awarded to respondent. CA agreed with the findings of NLRC that retrenchment could be a valid cause to terminate respondents employment with Petrocon. However, although there was a valid retrenchment, the same was implemented without complying with the requisites of a valid retrenchment. Also, the CA concluded that although the respondent was given a 30-day notice of his termination, there was no showing that the Department of Labor and Employment (DOLE) was also sent a copy of the said notice as required by law. Moreover, the CA found that a perusal of the check payroll details would readily show that respondent was not paid his separation pay. ISSUES: 1. Petitioner contended that the 30-day notice of termination as required in Serrano vs NLRC is not applicable to the case at bar considering that, in fact, respondent was given the 30-day notice. RA 8042 or the Migrant Workers Act and its implementing rules do not require the sending of notice to DOLE thirty (30) days before the effectivity of the retrenchment of an OFW. 2. Petitioner also posits that the CA should have applied the case of Jariol v. IMS even if the said case was only decided by the NLRC, a quasi-judicial agency. The said case involved similar facts,

wherein the NLRC categorically ruled that employers of OFWs are not required to furnish the DOLE in the Philippines a notice if they intend to terminate a Filipino employee. 3. Lastly, petitioner insists that respondent received his separation pay. Moreover, petitioner contends that Section 10 of R.A. No. 8042 does not apply in the present case, since the termination of respondent was due to a just, valid or authorized cause. At best, respondent is only entitled to separation pay in accordance with Article 283 of the Labor Code, i.e., one (1) month pay or at least one-half (1/2) month pay for every year of service, whichever is higher. RULING: 1. In the case at bar, despite the fact that respondent was employed by Petrocon as an OFW in Saudi Arabia, still both he and his employer are subject to the provisions of the Labor Code when applicable. The basic policy in this jurisdiction is that all Filipino workers, whether employed locally or overseas, enjoy the protective mantle of Philippine labor and social legislations. In the case of Royal Crown Internationale v. NLRC, this Court has made the policy pronouncement, thus: 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. x xx Article 283 of the Labor Code provides that retrenchment is a valid cause for dismissal. Thus, retrenchment is a valid exercise of management prerogative subject to the strict requirements set by jurisprudence, to wit: (1) That the retrenchment is reasonably necessary and likely to prevent business losses which, if already incurred, are not merely de minimis, but substantial, serious, actual and real, or if only expected, are reasonably imminent as perceived objectively and in good faith by the employer; (2) That the employer served written notice both to the employees and to the Department of Labor and Employment at least one month prior to the intended date of retrenchment; (3) That the employer pays the retrenched employees separation pay equivalent to one month pay or at least month pay for every year of service, whichever is higher; (4) That the employer exercises its prerogative to retrench employees in good faith for the advancement of its interest and not to defeat or circumvent the employees' right to security of tenure; and (5) That the employer used fair and reasonable criteria in ascertaining who would be dismissed and who would be retained among the employees, such as status, x x x efficiency, seniority, physical fitness, age, and financial hardship for certain workers.

As for the notice requirement, however, contrary to petitioners contention, proper notice to the DOLE within 30 days prior to the intended date of retrenchment is necessary and must be complied with despite the fact that respondent is an overseas Filipino worker. In the present case, although respondent was duly notified of his termination by Petrocon 30 days before its effectivity, no allegation or proof was advanced by petitioner to establish that Petrocon ever sent a notice to the DOLE 30 days before the respondent was terminated. Thus, this requirement of the law was not complied with. 2. Moreover, petitioners insistence that the case of Jariol v. IMS should be applied in the present case is untenable. Being a mere decision of the NLRC, it could not be considered as a precedent warranting its application in the case at bar. Suffice it to state that although Article 8 of the Civil Code recognizes judicial decisions, applying or interpreting statutes as part of the legal system of the country, such level of recognition is not afforded to administrative decisions. ~NLRC decisions are administrative decisions 3. Section 10 of RA 8042 states as follows: Sec. 10. Money Claims. x x x In case of termination of overseas employment without just, valid or authorized cause as defined by law or contract, x x x In this case, however, despite the fact that respondents termination from employment was procedurally infirm, the same remains to be for a just, valid and authorized cause retrenchment is a valid exercise of management prerogative. Consequently, RA 8042 should not be applied. Instead, it is Art. 283 of Labor Code which is controlling. Thus, respondent is entitled to payment of separation pay equivalent to one (1) month pay, or at least one-half (1/2) month pay for every year of service, whichever is higher. Considering that respondent was employed by Petrocon for a period of eight (8) months, he is entitled to receive one (1) month pay as separation pay. In addition, pursuant to current jurisprudence, for failure to fully comply with the statutory due process of sufficient notice, respondent is entitled to nominal damages in the amount P50,000.00. Petitioner is ORDERED to pay Roel P. Logarta one (1) month salary as separation pay and P50,000.00 as nominal damages.