RUTCHER DAGASDAS v.

GRAND PLACEMENT AND GENERAL SERVICES CORPORATION

FACTS:

 PARTIES:
o Grand Placement and General Services Corp. (GPGS) – licensed recruitment or placement
agency in the Philippines
o Saudi Aramco (Aramco) – its counterpart in Saudi Arabia
o Industrial & Management Technology Methods Co. Ltd. (ITM) – the principal of GPGS
 Nov. 2007: GPGS in behalf of ITM, employed Dagasdas as a Network Technician
o He was to be deployed in Saudi Arabia under a 1yr contract
o Before leaving, he underwent skill training and pre-departure orientation as Network Technician
o However, his Job Offer indicated that he was accepted by Aramco and ITM for the position of
“Supt.”
 Dagasdas contended that he actually applied for and was engaged as a Civil Engineer considering that his
ToR, diploma as well as CV showed that he had a degree in Civil Engineering, and his work experiences were
all related to this field
o The position of Network Technician was only for the purpose of securing a visa because ITM
could not support visa application for Civil Engineers
 Feb 2008: Dagasdas arrived in Saudi Arabia and signed a new employment contract with ITM which
stipulated that they contracted him as Superintendent.
o He was to be placed under 3month probation period
o The new contract cancels all contracts prior to its date
 He was allegedly given tasks suited for a Mechanical Engineer, which were foreign to the job and experience
he applied for
 He raised this concern to his supervisor and was transferred to the Civil Engineering Department
o He was temporarily given a position as a Civil Construction Engineer with an ID good for
1month
 Mar 2008: He was directed to exit the worksite but Rashid Siddiqui, Site Coordinator Manager advised him to
remain in the premises
 Before Dagasdas’ case was investigated, Siddiqui had already terminated his employment with ITM
 Apr 2008: Dagasdas was given a termination notice indicating that ITM reserved the right to terminate any
employee within the 3month probationary period without need of any notice to the employee
 Dagasdas signed a Statement of Quitclaim before his repatriation stating that ITM paid him all the salaries and
benefits for his services from Feb-Apr 2008.
 June 2008: Dagasdas returned to PH and filed an illegal dismissal case against GPGS, ITM, and Aramco
o for misrepresentation, which resulted in the mismatch in the work assigned to him
o that although he was engaged as a project employee. He was still entitled to security of tenure for
the duration of his contract
 GPGS, ITM and Aramco claim that Dagasdas was legally dismissed
o Dagasdas was aware that he was employed as Network Technician
o Dagasdas was informed of his poor work performance and
o He conformed to his termination as evidenced by his quitclaim
o He was only a probationary employee since he worked for ITM for less than 3months
 LA: dismissed the case for lack of merit
o When Dagasdas signed his new employment contract, he accepted its stipulations, including the
fact that he had to undergo probationary status
o The new contract was more advantageous as the position was upgraded to Superintendent, and for
being favorable, it is not prohibited by law
 NLRC: reversed LA; there was illegal dismissal
o Dagasdas, who was a Civil Engineering graduate was recruited on paper by GPGS as a Network
Technician but the real understanding was to hire him as a Superintendent
o GPGS erroneously recruited Dagasdas and failed to inform him that he was hired as a Mechanical
Superintendent
o While ITM has a prerogative to continue employment of individuals only if they were qualified,
the dismissal in this case amounted to illegal termination since mismatch between his
qualifications and the job give him was no fault of his
 CA: reinstated LA Decision dismissing the case for lack of merit
o The new agreement signed by Dagasdas was for the position of Superintendent and without the
participation of GPGS
o After commencing work as Superintendent, Dagasdas realized he could not perform his tasks and
seemingly it was Dagasdas himself who voluntarily withdrew from his assigned work for lack of
competence
ISSUE: Whether Dagasdas was validly dismissed from work

HELD: YES. It is well-settled that employers have the prerogative to impose standards on the work quantity and quality of
their employees and provide measures to ensure compliance. Non-compliance with work standards may thus be a valid
cause for dismissing an employee. Nonetheless, to ensure that employers will not abuse their prerogatives, the same is
tempered by security of tenure whereby the employees are guaranted substantive and procedural due process before they
are dismissed from work.

Security of tenure remains even if employees, particularly the overseas Filipino workers (OFW), work in a different
jurisdiction. Since the employment contracts of OFWs are perfected in the Philippines, and following the principle of lex
loci contractus (the law of the place where the contract is made), these contracts are governed by our laws primarily the
Labor Code. At the same time, our laws generally apply even to employment contracts of OFWs as our Constitution
explicitly provides that the State shall afford full protection to labor, whether local or overseas. Thus, even if a Filipino is
employed abroad, he or she is entitled to security of tenure, among other constitutional rights.

In this case, prior to his deployment and while still in the Philippines, Dagasdas was made to sign a POEA-approved
contract with GPGS, on behalf of ITM; and, upon arrival in Saudi Arabia, ITM made him sign a new employment contract.
Nonetheless, this new contract, which was used as basis for dismissing Dagasdas, is void.

1. Dagasdas' new contract is in clear violation of his right to security of tenure. Under the Labor Code of the
Philippines the following are the just causes for dismissing an employee:

ARTICLE 297. [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.

However, per the notice of termination given to Dagasdas, ITM terminated him for violating clause 17.4.3 of his new
contract, viz.:
17.4 The Company reserves the right to terminate this agreement without serving any notice to the Consultant in
the following cases:
xxxx
17.4.3 If the Consultant is terminated by company or its client within the probation period of 3 months.

Based on the foregoing, there is no clear justification for the dismissal of Dagasdas other than the exercise of ITM's right to
terminate him within the probationary period. Even assuming that Dagasdas was still a probationary employee when he
was terminated, his dismissal must still be with a valid cause. As regards a probationary employee, his or her dismissal may
be allowed only if there is just cause or such reason to conclude that the employee fails to qualify as regular employee
pursuant to reasonable standards made known to the employee at the time of engagement. ITM failed to prove that it
informed Dagasdas of any predetermined standards from which his work will be gauged.In the contract he signed while
still in the Philippines, Dagsadas was employed as Network Technician; on the other hand, his new contract indicated that
he was employed as Superintendent. However, no job description - or such duties and responsibilities attached to either
position - was adduced in evidence. It thus means that the job for which Dagasdas was hired was not definite from the
beginning.

Dagasdas was not sufficiently informed of the work standards for which his performance will be measured. Even his
position based on the job title given him was not fully explained by his employer. Simply put, ITM failed to show that it set
and communicated work standards for Dagasdas to follow, and on which his efficiency (or the lack thereof) may be
determined.

2. The new contract was not shown to have been processed through the POEA. Under our Labor Code,
employers hiring OFWs may only do so through entities authorized by the Secretary of the Department of
Labor and Employment. Unless the employment contract of an OFW is processed through the POEA, the
same does not bind the concerned OFW because if the contract is not reviewed by the POEA, certainly the
State has no means of determining the suitability of foreign laws to our overseas workers.
 3. Under this new contract, Dagasdas was not afforded procedural due process when he was dismissed from
work.

As cited above, a valid dismissal requires substantive and procedural due process. As regards the latter, the employer must
give the concerned employee at least two notices before his or her tem1ination. Specifically, the employer must inform the
employee of the cause or causes for his or her termination, and thereafter, the employer's decision to dismiss him. Aside
from the notice requirement, the employee must be accorded the opportunity to be heard.

4. While it is shown that Dagasdas executed a waiver in favor of his employer, the same does not preclude him
from filing this suit.

Generally, the employee's waiver or quitclaim cannot prevent the employee from demanding benefits to which he or she is
entitled, and from filing an illegal dismissal case. This is because waiver or quitclaim is looked upon with disfavor, and is
frowned upon for being contrary to public policy. Unless it can be established that the person executing the waiver
voluntarily did so, with full understanding of its contents, and with reasonable and credible consideration, the same is not a
valid and binding undertaking. Moreover, the burden to prove that the waiver or quitclaim was voluntarily executed is with
the employer.

In this case, however, neither did GPGS nor its principal, ITM, successfully discharged its burden. GPGS and/or ITM
failed to show that Dagasdas indeed voluntarily waived his claims against the employer.

Indeed, even if Dagasdas signed a quitclaim, it does not necessarily follow that he freely and voluntarily agreed to waive all
his claims against his employer.

All told, the dismissal of Dagasdas was without any valid cause and due process of law. Hence, the NLRC properly ruled
that Dagasdas was illegally dismissed.

WHEREFORE, the Petition is GRANTED. The Decision of the Court of Appeals are REVERSED and SET
ASIDE. Accordingly, the Resolutions of the National Labor Relations Commission are REINSTATED. SO ORDERED.

TSM SHIPPING PHILS., INC. and/or DAIVIPSKIBSSELSAKABET NORDEN A/S vs. Louie PATIÑO
FACTS

1. TSM, in behalf of its foreign principal, DNAS, entered into a Contract of Employment with Patiño for a period of
6months as GP2/OS (General Purpose 2/Ordinary Seaman) for the vessel Nord Nightingale.
2. While working on board the vessel, Patiño injured his right hand while securing a mooring rope. He was brought to a
medical facility in Istanbul, Turkey, where X-ray showed a fracture on his 5th metacarpal bone. His right hand was placed
in a cast. Thereafter he was repatriated.
3. Upon arrival in Manila, Patiño get further treatment, surgical operation and physical therapy.
17 Aug. 2010 – After extensive medical treatments, Dr. Cruz (company physician) rendered an interim assessment of
Patiños disability under the POEA-SEC, at Grade 10, or loss of grasping power for small objects between the fold of the
finger of one hand.
4. 8 Sept. 2010 – Patiño filed a complaint with the NLRC against petitioners for total and permanent disability benefits,
damages, and attorney's fees.
11 Oct. 2010 – Dr. Cruz declared Patiño to have reached the maximum medical cure after rendering a final disability rating
of Grade 10 on September 29, 2010
19 Nov. 2010 – Another doctor, Dr. Escutin (Patiños own physician), assessed him to have permanent disability unfit for
sea duty in whatever capacity as a seaman.
5. Patiño asked for permanent total disability benefits in the sum of US$80K under the CBA.
 Since, according to him, he never recovered completely nor returned to his usual duties and responsibilities, as
attested by the medical findings of Dr. Escutin, his own physician.
Petitioners, however, claimed that Patiño is only entitled to US$10,075.00 corresponding to Grade 10 disability under the
POEA-SEC, as assessed, on the other hand, by Dr. Cruz.
  They maintained that Dr. Cruz’s assessment deserves greater weight than the belated medical report rendered
by Dr. Escutin after a single examination on Patiño.
 Petitioners also stressed that he cannot claim benefits under the CBA since he has not proven that he is a
member of AMOSUP (the union).
6. LA: Patiño is indeed suffering from a total and permanent disability since his rehabilitation took five months or more
than 120 days and there was no offer on the part of petitioners to rehire him.
NRLC: Agreed with LA. CA: Affirmed NLRC.
ISSUE
1. W/N Patiño should be awarded with total and permanent disability compensation – NO.
2. W/N Dr. Cruz’s finding prevails over that of Dr. Escutin – YES.

HELD
1) First issue – NO.
As the provisions in POEA-Standard Employment Contract states: the seafarer, upon sign-off from his vessel, must report
to the company-designated physician within three (3) days from arrival for diagnosis and treatment.
 For the duration of the treatment but in no case to exceed 120 days, the seaman is on temporary total
disability as he is totally unable to work.
o He receives his basic wage during this period until he is declared fit to work or his temporary
disability is acknowledged by the company to be permanent, either partially or totally, as his
condition is defined under the POEA-SEC and by applicable PH laws.
 If the 120 days initial period is exceeded and no such declaration is made because the seafarer requires further
medical attention, then the temporary total disability period may be extended up to a maximum of 240 days,
subject to the right of the employer to declare within this period that a permanent partial or total disability
already exists. The seaman may of course also be declared fit to work at any time such declaration is justified
by his medical condition.
PATIÑO'S COMPLAINT FOR DISABILITY BENEFITS WAS PREMATURE
Patiños was repatriated on May 24, 2010. On August 17, 2010, an interim assessment of Grade 10 was given
by Dr. Cruz as Patiño was still undergoing further treatment and physical therapy. However, on September 8, 2010, or 107
days since repatriation, Patiño filed a complaint tor total and permanent disability benefits. During this time, he was
considered under temporary total disability inasmuch as the 120/240-day period had not yet lapsed. Evidently, the
complaint was prematurely filed.
Moreover when he filed his complaint, Patiño was armed only with the interim medical assessment of the
company physician and his belief that his injury had already rendered him permanently disabled. It was only after the filing
of such complaint or on November 9, 2010 that he sought the opinion of Dr. Escutin, his own physician. As such the Labor
Arbiter should have dismissed at the first instance the complaint for lack of cause of action.
PATIÑO IS NOT ENTITLED TO TOTAL AND PERMANENT DISABILITY COMPENSATION.
The rule is that a temporary total disability only becomes permanent when the company designated physician,
within the 240-day period, declares it to be so, or when after the lapse of the said period, he fails to make such declaration.
Dr. Cruz then rendered on September 29, 2010 a final assessment of Grade 10 upon reaching the maximum
medical cure. Counting from the date of repatriation on May 24, 2010 up to September 29, 2010, this assessment was
made within the 240-day period. Clearly, before the maximum 240-day medical treatment period expired, Patiño was
issued a Grade 10 disability rating which is merely equivalent to a permanent partial disability under the POEA-SEC. Thus,
Patiño could not have been suffering from a permanent total disability as would entitle him to the maximum benefit of
US$60,000.00.
2) Second issue – YES.
The POEA-SEC clearly provides that when a seafarer sustains a work-related illness or injury while on board the vessel,
his fitness or unfitness for work shall be determined by the company-designated physician.
However, if the doctor appointed by the seafarer makes a finding contrary to that of the assessment of the company-
designated physician, a third doctor may be agreed jointly between the employer and the seafarer and the latter's decision
shall be final and binding on both of them.
 The Court has held that non-observance of the requirement to have the conflicting assessments determined by
a third doctor would mean that the assessment of the company-designated physician prevails.
Hence, the disability grading of Dr. Cruz should be given more weight than the medical opinion given by Dr. Escutin.
 At any rate, more weight should be given to this assessment as Dr. Cruz was able to closely monitor Patiños
condition from the time he was repatriated in May 2010 until his last follow-up examination in October 2010.
Patiño is thus entitled to the amount corresponding to Grade 10 based on the certification issued by Dr. Cruz.
*Total disability – means an incapacity to work resulted in the impairment of one’s earning capacity.