Paulino Ungos III

Lawyer | Law Professor | Author

Tag: 2019-01

  • Seafarer’s Surviving Legitimate Spouse, a Necessary Party in a Complaint for Death Benefits

    In Leonis Navigation Agency, Inc. v. Dagos,1G.R. No. 241909, January 14, 2019. the Supreme Court ruled that the surviving legitimate spouse of the seafarer is not an indispensable party but only a necessary party in a complaint for death benefits. According to the Court, there is no law stating that only the legal spouse has the legal standing to institute a complaint to claim death benefits under the Amended Standard Terms and Conditions Governing the Overseas Employment of Filipino Seafarers On-Board Ocean-Going Ships2Philippine Overseas Employment Administration Memorandum Circular No. 10-10.. The failure to implead her will not result in the dismissal of the claim.

    Further reading:

    • Leonis Navigation Agency, Inc. v. Dagos, G.R. No. 241909, January 14, 2019.

  • Economic Terms of the CBA and GOCC Employees

    On December 20, 2013, employees of GSIS Family Bank, a non-chartered Government-Owned or Controlled Corporation, demanded for the payment of their Christmas bonus which had been annually given them pursuant to their Collective Bargaining Agreement with said bank.

    GSIS Family Bank refused to grant the said bonus. This was because it was advised by the Governance Commission for Government-Owned or Controlled Corporations (or the Governance Commission) that it could not grant incentives and other benefits to its employees, without authority from the President of the Philippines. According to the Governance Commission, as a government financial institution, GSIS Family Bank was not authorized to enter into a collective bargaining agreement with its employees based on the principle that compensation and position classification system of its employees is provided for by law and not subject to private bargaining.

    Was the refusal valid?

    The Supreme Court ruled that it was valid. The Court found that GSIS Family Bank could not be faulted for refusing to enter into a new collective bargaining agreement with petitioner as it lacked the authority to negotiate economic terms with its employees.

    In denying the claims of the employees of GSIS Family Bank, the Supreme Court illustrated the interplay between the provisions of the Labor Code of the Philippines and the provisions of the GOCC Governance Act of 2011 (or Republic Act Number 10149) on the life of a non-chartered government-owned or controlled corporation.

    The Court ruled that the power of a government-owned or controlled corporation to fix salaries or allowances of its employees is subject to and must conform to the compensation and classification standards laid down by applicable law, specifically the GOCC Governance Act of 2011. According to the Court, the said law does not differentiate between chartered and non-chartered government-owned or controlled corporations; hence, the provisions of this law equally apply to all GOCCs.

    Furthermore, the Court ruled that while government-owned or controlled corporations without original charters are covered by the Labor Code of the Philippines, employees of said government-owned or controlled corporations are bereft of any right to negotiate the economic terms of their employment, i.e., salaries, emoluments, incentives and other benefits, with their employers since these matters are covered by compensation and position standards issued by applicable law.

    According to the Court, the law1Section 9 of Republic Act No. 10149 categorically states, “Any law to the contrary notwithstanding, no [government-owned or controlled corporation] shall be exempt from the coverage of the Compensation and Position Classification System developed by the [Governance Commission] under this Act.” The law also directed the Governance Commission to develop a Compensation and Position Classification System, to be submitted for the approval of the President of the Philippines, which shall apply to all officers and employees of government-owned or controlled corporations, whether chartered or non-chartered. When it comes to collective bargaining agreements and collective negotiation agreements in government-owned or controlled corporations, the President of the Philippines, through Executive Order No. 2032Section 2 issued on March 22, 2016, stated that while it recognized the right of workers to organize, bargain, and negotiate with their employers, “the Governing Boards of all covered [government-owned or controlled corporations], whether Chartered or Non-chartered, may not negotiate with their officers and employees the economic terms of their [collective bargaining agreements].”

    Further reading:

    • GSIS Family Bank Employees Union v. Villanueva, G.R. No. 210773, January 23, 2019.

  • Seafarer’s Noncompliance with the Third Doctor Referral Procedure

    The seafarer entered into a 9-month employment contract with Veritas Maritime Corp. to work as a bosun on board the M/V Bangkok Highway, a vessel owned by TNCK Kline. He boarded the vessel on 15 October 2011.

    The seafarer claimed that while he was on official duty on 10 February 2012, thinner solution spilled over his face, neck, chest, and arm, which suffered third-degree burns. When the vessel reached the port in Korea, the seafarer was brought to Dr. Kim Sung Jin, who diagnosed him to have suffered about a 15% to 20% third-degree burn. Said doctor declared him unfit for work, and recommended that he be immediately hospitalized for special burn treatment.

    The seafarer arrived in the Philippines on 23 February 2012 and was placed under the care of the company-designated physician, who diagnosed him with contact dermatitis.

    On 25 May 2012, the company-designated physician declared him fit to go back to work.

    The seafarer thereafter consulted his personal doctor who declared that he is not yet well.

    On 27 July 2012, the seafarer filed a complaint against Veritas Maritime Corp., et al., for payment of permanent total disability benefits, moral and exemplary damages, and attorney’s fees.

    Question:

    Will the seafarer’s complaint prosper?

    Answer:

    No. The complaint should be dismissed.

    Section 20 (A) (2)1Relevant portion states: “2. x x x However, if after repatriation, the seafarer still requires medical attention arising from said injury or illness, he shall be so provided at cost to the employer until such time he is declared fit or the degree of his disability has been established by the company-designated physician.” and (3)2Relevant portion states: “3. x x x If a doctor appointed by the seafarer disagrees with the assessment, a third doctor may be agreed jointly between the Employer and the seafarer. The third doctor’s decision shall be final and binding on both parties.” of the Philippine Overseas Employment Administration Standard Employment Contract3Amended Standard Terms and Conditions Governing the Overseas Employment of Filipino Seafarers On-Board Ocean-Going Ships, POEA Memorandum Circular No. 010, Series of 2010. requires the company-designated physician to determine the seafarer’s fitness to work or degree of disability upon the seafarer’s medical repatriation. Nonetheless, the seafarer may dispute the company-designated physician’s report by seasonably consulting another doctor. If this doctor appointed by the seafarer disagrees with the assessment of the company-designated physician, a third doctor may be agreed jointly between the employer and the seafarer. The third doctor’s decision shall be final and binding on both parties. Jurisprudence4Escabusa v. Veritas Maritime Corp., G.R. No. 223732, January 16, 2019; Magsaysay Maritime Corp. et al. v. Verga, G.R. No. 221250, October 10, 2018; Calimlim v. Wallem Maritime Services, Inc., G.R. No. 220629, November 23, 2016; INC Navigation Co. Philippines, Inc., et al. v. Rosales, 744 Phil. 774 (2014); Phil. Hammonia Ship Agency, Inc., et al. v. Dumadag, 712 Phil. 507 (2013); Ayungo v. Beamko Shipmanagement Corp., et al., 728 Phil. 244 (2014); Santiago v. Pacbasin ShipManagement, Inc., et al., 686 Phil. 255 (2012); Andrada v. Agemar Manning Agency, Inc., et al., 698 Phil. 170 (2012); Masangcay v. Trans-Global Maritime Agency, Inc., et al., 590 Phil. 611 (2008); and Vergara v. Hammonia Maritime Services, Inc., et al., 588 Phil. 895 (2008). dictates that this referral to a third doctor is a mandatory procedure that must be strictly followed.

    In the present case, it was shown that on 25 May 2012, about 3 months from his repatriation, the company-designated physician declared the seafarer fit for work.

    Although the seafarer consulted his personal doctor (who apparently had an opinion contrary to that reached by the company-designated physician), there was no showing that at the time the complaint was filed, said seafarer had observed the third doctor referral procedure under the Philippine Overseas Employment Administration Standard Employment Contract.

    The seafarer’s noncompliance with the third doctor referral procedure constituted a breach of the Philippine Overseas Employment Administration Standard Employment Contract and thus rendered his complaint dismissible for being premature. Jurisprudence5Escabusa v. Veritas Maritime Corp., G.R. No. 223732, January 16, 2019;Calimlim v. Wallem Maritime Services, Inc., et al., 800 Phil. 830 (2016); Veritas Maritime Corp., et al. v. Gepanaga, Jr., 753 Phil. 308 (2015); Philman Marine Agency, Inc., et al. v. Cabanban, 715 Phil. 454 (2013); and Vergara v. Hammonia Maritime Services, Inc., et al., 588 Phil. 895 (2008). teaches that in such a situation, the company-designated physician’s findings should prevail.

    Further reading:

    • Escabusa v. Veritas Maritime Corp., G.R. No. 223732, January 16, 2019.

  • Rules on Seafarer Claims for Permanent Total Disability Benefits

    Abosta Shipmanagement Corporation/Cido Shipping Company Ltd. hired the seafarer as an able seaman on board the vessel M/V Grand Quest. The seafarer boarded the vessel on 16 June 2009.

    While he was on duty on 26 October 2010, the seafarer felt cramps followed by severe back pain. He was able to inform his master, who then advised him to rest. The next day, the seafarer was unable to stand that he remained in his cabin. When the vessel arrived in Panama, he was diagnosed with a lumbar disc problem and was recommended repatriation.

    On 2 December 2010, the seafarer arrived in Manila and was referred to the company-designated physician, who then proceeded to treat him. On 8 July 2011 the company-designated physician issued a disability rating of “Grade 8 disability — moderate rigidity or 2/3 loss of motion or lifting power of the trunk.”

    The seafarer asserts that despite the treatment he received, his condition did not improve, as the pain and discomfort persisted.

    The seafarer sought treatment from his personal doctor, who conducted his own examination. Said doctor concluded that the nature and extent of the seafarer’s injury rendered him permanently and totally unable to work as a seafarer.

    The seafarer demanded his employers to pay him total and permanent disability. Since the employers declined, the seafarer instituted his complaint for permanent total disability benefits and attorney’s fees against the former.

    Questions:

    1. Is the seafarer entitled to permanent total disability benefits?
    2. Can he be granted attorney’s fees?

    Answers:

    1)

    The seafarer is entitled to permanent total disability benefits.

    Jurisprudence dictates that if there is a claim for total and permanent disability benefits by a seafarer, the following rules shall govern:

    • The company-designated physician must issue a final medical assessment on the seafarer’s disability grading within a period of 120 days from the time the seafarer reported to him;
    • If the company-designated physician fails to give his assessment within the period of 120 days, without any justifiable reason, then the seafarer’s disability becomes permanent and total;
    • If the company-designated physician fails to give his assessment within the period of 120 days with a sufficient justification (e.g., seafarer required further medical treatment or seafarer was uncooperative), then the period of diagnosis and treatment shall be extended to 240 days. The employer has the burden to prove that the company-designated physician has sufficient justification to extend the period; and
    • If the company-designated physician still fails to give his assessment within the extended period of 240 days, then the seafarer’s disability becomes permanent and total, regardless of any justification.

    In the present case, the company-designated physician failed to issue a medical assessment on the seafarer’s disability grading and determine the seafarer’s fitness to work within the prescribed periods.

    From the seafarer’s repatriation and immediate referral to the company-designated physician on 2 December 2010 until the 120th day of his treatment (31 March 2011), the latter did not issue any medical assessment.

    Although on 8 July 2011, the company-designated physician was able to issue a disability rating of “Grade 8 disability — moderate rigidity or 2/3 loss of motion or lifting power of the trunk,” 219 days have already lapsed from 2 December 2020 without any sufficient justification for the extension of the 120-day treatment period.

    Following prevailing jurisprudence, the seafarer’s disability has become permanent and total. Accordingly, the seafarer is entitled to permanent total disability benefits.

    2)

    The seafarer is also entitled to attorney’s fees. This is because under Article 2208, paragraph 8 of the Civil Code of the Philippines, attorney’s fees can be recovered in actions for indemnity under workmen’s compensation and employer’s liability laws.

    Further reading:

    • Abosta Shipmanagement Corp. v. Segui, G.R. No. 214906, January 16, 2019.

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  • Judicial Review of Orders or Decisions of the Department of Agrarian Reform Adjudication Board

    The Rules of Court clearly provides that awards, judgments, final orders or resolutions of quasi-judicial agencies are appealable to the Court of Appeals via Rule 43. Orders or decisions of the Department of Agrarian Reform Adjudication Board may be brought on appeal to the Court of Appeals within 15 days from receipt of the same.12009 Department of Agrarian Reform Adjudication Board Rules of Procedure

    Further reading:

    • Rivera v. Heirs of Cabling, G.R. No. 242036, January 14, 2019.

  • Establish Compliance with the Post-employment Medical Examination

    In Mesta v. United Philippine Lines, Inc.,1G.R. No. 242719, January 14, 2019. the Supreme Court emphasized that the seafarer must comply with the post-employment medical examination set forth under Section 20 (A) (3) of the Amended Standard Terms and Conditions Governing the Overseas Employment of Filipino Seafarers On-Board Ocean-Going Ships.2Philippine Overseas Employment Administration Memorandum Circular No. 10, Series of 10. Section 20 (A) (3) provides:
    “SECTION 20. Compensation and Benefits. —
    “A. Compensation and Benefits for Injury or Illness
    “The liabilities of the employer when the seafarer suffers work-related injury or illness during the term of his contract are as follows:
    x x x
    3. x x x For this purpose, the seafarer shall submit himself to a post-employment medical examination by a company-designated physician within three working days upon his return except when he is physically incapacitated to do so, in which case, a written notice to the agency within the same period is deemed as compliance. In the course of the treatment, the seafarer shall also report regularly to the company-designated physician specifically on the dates as prescribed by the company-designated physician and agreed to by the seafarer. Failure of the seafarer to comply with the mandatory reporting requirement shall result in his forfeiture of the right to claim the above benefits.     The Court said:

    x x x [P]etitioner failed to establish compliance with the mandatory post-employment medical examination. Jurisprudence provides that one who alleges a critical fact has the burden to prove his allegation with substantial evidence, which petitioner failed to do. Aside from her bare allegation, records are bereft of any evidence to show that petitioner indeed went to respondent United Philippine Lines, Inc.’s office to request for medical attention which was allegedly rebuffed.

    Nevertheless, even assuming that petitioner did comply with the requisite post-employment medical examination, the CA was also correct in finding that the causal connection between her illness and the work she performed onboard the ship was not established. Petitioner merely presented documentary evidence to show her condition before and after the termination of her contract but failed to establish how the nature of her work increased the risk of contracting her illness. Thus, petitioner is not entitled to claim disability benefits under the POEA-SEC.

    Further Reading:

    • Mesta v. United Philippine Lines, Inc., G.R. No. 242719, January 14, 2019.

  • No Basis to Award Salary Equivalent to 3 Months

    In Alster International Shipping Services, Inc v. Acosta,1G.R. No. 242085, January 14, 2019. the Supreme Court reiterated the principle that an illegally dismissed migrant worker is entitled to payment of salaries for the unexpired portion of the employment contract. The Court said:

    With respect to the proper amount of indemnity due him, the provision of law, restricting wages recoverable by illegally dismissed overseas workers to three months only, having been struck down twice for its unconstitutionality, there is no more coherent legal basis for restricting the unpaid salaries award in favor of respondent to an amount equivalent to three months’ worth of work only. Hence, respondent is entitled to the payment of unpaid salaries equivalent to the remaining unexpired portion of his employment contract.

    Further reading:

    • Alster International Shipping Services, Inc v. Acosta, G.R. No. 242085, January 14, 2019.

  • Allegations with Substantial Evidence

    In Republic v. Pilpa1G.R. No. 242549, January 14, 2019., the Supreme Court reiterated the principle that the one who makes an allegation has the burden of proving it. A party alleging a critical fact must support his allegation with substantial evidence. Any decision based on unsubstantiated allegation cannot stand as it will offend due process. The Court said:

    x x x The CA was also correct when it ruled that VGC failed to rebut respondents’ claim that the six (6)-day workweek has been in existence since VGC took over the management of the golf course in 2007 and, as such, has become a company practice. Jurisprudence provides that one who alleges a critical fact has the burden to prove his allegation with substantial evidence. Aside from its bare allegations, VGC failed to establish by substantial evidence that it was suffering from serious losses which necessitated the reduction in the number of working days per week.

    Further reading:

    • Republic v. Pilpa, G.R. No. 242549, January 14, 2019.

  • Company-designated Physician’s Failure to Make a Definite Assessment

    Singa Ship Management Philippines, Inc. v. Ignes,1G.R. No. 243285, January 14, 2019. re-emphasized the rule that within the 120-day period from the seafarer’s repatriation, the company-designated physician must either make a definite assessment of the seafarer’s fitness to resume work or the degree of his permanent disability, or provide sufficient justification to extend the medical treatment from 120 days to 240 days. Failure of the company-designated physician to do so shall lead to a conclusive presumption that the seafarer’s disability is permanent and total. Said the Court:

    [F]rom the time of Ignes’ repatriation on November 26, 2015 until the expiration of the one hundred twenty (120)-day period on March 25, 2016, there was neither a final medical assessment nor recommendation for further treatment issued by the company-designated physician (CDP). Notably, the CDP’s March 30, 2016 Disability Grading and Medical Report, which was in fact issued after the 120-day assessment period under Section 20 (A) (3) of the 2010 Philippine Overseas Employment Administration-Standard Employment Contract (POEA-SEC), did not state a definitive assessment of Ignes’ fitness or unfitness to resume his duties as a seafarer. While it declared that Ignes may return to work, it also stated that his capacity to return hinges on the result of his re-evaluation, which must be conducted six (6) months after his operation on January 25, 2016 or on or after July 25, 2016. It must be emphasized that the CDP must, within the 120-day period, either make a definite assessment of the seafarer’s fitness to resume work or the degree of his permanent disability,2See Elburg Shipmanagement Phils., Inc. v. Quiogue, 765 Phil. 341, 360 (2015). See also APQ Shipmanagement Co., Ltd. v. Caseñas, 735 Phil. 300, 320 (2014). See further Carcedo v. Maine Marine Philippines, Inc., 758 Phil. 166, 183 (2015). or provide sufficient justification to extend the medical treatment from 120 days to 240 days;3See Orient Hope Agencies, Inc. v. Jara, G.R. No. 204307, June 6, 2018. otherwise, the seafarer’s disability shall be conclusively presumed to be permanent and total,4See Jebsens Maritime, Inc. v. Rapiz, 803 Phil. 266, 273 (2017). as in this case. Accordingly, the CA did not err in upholding the award of permanent total disability benefits to Ignes.

    Further reading:

    • Singa Ship Management Philippines, Inc. v. Ignes, G.R. No. 243285, January 14, 2019.

  • Prescriptive Period of Claims for Service Incentive Leave Pay

    In Dula v. Datem, Inc.,1G.R. No. 234466, January 10, 2019. the Supreme Court reiterated the principle that the 3-year prescriptive period for a claim of service incentive leave pay commences from the employee’s resignation or separation from employment. The Court ruled:

    The Court, however, modifies the decision of the CA insofar as the award of service incentive leave pay to petitioner is concerned. Auto Bus Transport System, Inc. v. Bautista [G.R. No. 156367, May 16, 2005, 458 SCRA 578, 596.] clarified that the three (3)-year prescriptive period under Article [306] of the Labor Code commences from the time when the employer refuses to pay its monetary equivalent after demand of commutation or upon termination of the employee’s services, as the case may be. Thus, the prescriptive period with respect to petitioner’s claim for his entire service incentive leave pay commenced only from the time of his resignation or separation from employment in October 2010. Since petitioner filed his complaint in April 2013, his claim for service incentive leave pay has not yet prescribed and he may be awarded service incentive leave pay for his entire years of service with the company.

    Further Reading:

    • Dula v. Datem, Inc., G.R. No. 234466, January 10, 2019.

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