Jerzon Manpower and Trading, Inc. vs. Nato

An overseas Filipino worker who is contractually entitled to health insurance benefits may not be denied those rights notwithstanding the termination of employment or the lack of proof that the illness is work-connected, and DOLE-accredited recruitment agencies that fail to ensure their foreign principals comply with this obligation are solidarily liable, their failure constituting gross neglect and bad faith. Additionally, the dismissal of an employee on the ground of disease requires a certification from a competent public authority, and the absence thereof renders the dismissal illegal.

Jerzon Manpower and Trading, Inc. is a DOLE-accredited recruitment agency that deployed overseas Filipino workers on behalf of its foreign principal, United Taiwan Corp. (UTC), a Taiwan-based employer. Clifford Uy Tuazon is Jerzon's president and chairman of the board. Emmanuel B. Nato was hired by Jerzon for and on behalf of UTC as a machine operator in Taiwan under a fixed-term employment contract of one year, seven months, and seven days, with a monthly wage of NT$17,280.00. The employment contract expressly provided for labor insurance, accident insurance, and health insurance benefits subject to the laws of Taiwan. The dispute arose from Nato's illness, repatriation, and the parties' conflicting accounts of whether his departure from Taiwan was voluntary or employer-initiated.

On May 22, 2008, Jerzon Manpower and Trading, Inc. hired Emmanuel B. Nato as a machine operator for and on behalf of its foreign principal, United Taiwan Corp., under an employment contract with a fixed term of one year, seven months, and seven days and a monthly wage of NT$17,280.00. The contract expressly provided that Nato would be covered by labor insurance under Taiwan's labor insurance statute, accident insurance up to NT$300,000.00, and health insurance under Taiwan's national health insurance plan. Nato was deployed to Taiwan on June 8, 2008, and underwent routine medical checkups upon arrival, after six months, and after one year. As a machine operator, he was responsible for monitoring machines, operating the machine control system, and performing minor repairs, with daily exposure to vapors and emissions from the machines for eight to twelve hours.

About a year after deployment, Nato began experiencing occasional stomachaches that recurred with increasing severity. He informed his superior of his condition, but was ignored and told to continue working. He kept reporting for work despite weakness, severe stomach pains, and regular vomiting, until a co-worker took him to the hospital, where he was diagnosed with ulcer and given medication. His condition continued to worsen, and a subsequent hospital visit revealed Chronic Glomerulonephritis Stage V (End Stage) Renal Disease, with internal hemorrhoid bleeding, nausea, anorexia, face swelling, and malaise. He was confined for ten days of daily dialysis.

On July 16, 2009, Nato's broker had him discharged from the hospital and brought to a hotel room for a two-day quarantine, advising him that he would be sent back to the Philippines. On July 18, 2009, he was brought to the airport and given an airline ticket to the Philippines. Upon arrival, he was immediately taken to a hospital due to the severity of his illness; no one from petitioners' office met him at the airport or inquired about his condition during his hospitalization. Petitioners claimed that Nato himself requested repatriation, while Nato denied this, asserting that he expected to be allowed to recover in Taiwan given his contractual health and labor insurance benefits.

On June 22, 2012, Nato filed a complaint before the Labor Arbiter against Jerzon, UTC, and Clifford Uy Tuazon for payment of disability and medical benefits, hospitalization expenses, airline ticket, and salary for the unexpired portion of his contract. Petitioners failed to file their position paper despite an extension granted by the Labor Arbiter, and the case was deemed submitted for resolution. On February 10, 2013, while the case was pending before the NLRC, Nato died and was substituted by his surviving spouse, Lorna A. Nato.

• Finality of NLRC Decision: Petitioners argued that respondent's petition for certiorari before the CA should have been dismissed outright because the NLRC decision and resolution had already become final and executory, with an Entry of Judgment already issued.
• Insufficient Basis of LA Decision: Petitioners contended that the LA decision reinstated by the CA was based merely on respondent's self-serving allegations, since petitioners failed to file their position paper.
• Improper Ruling on Illegal Dismissal: Petitioners asserted that the CA erred in ruling on the legality of respondent's dismissal because it was not a cause of action in respondent's complaint before the LA.
• Lack of Proof of Medical Expenses: Petitioners maintained that respondent could not claim medical and hospitalization expenses because no receipts were presented as proof of payment.
• Illness Not Work-Related: Petitioners opined that respondent was not entitled to sickness or disability benefits because his ailment was not an occupational disease.
• No Termination by Employer: Petitioners denied terminating respondent's employment and claimed that it was respondent who requested repatriation, akin to voluntary resignation.

• Wrong Remedy by Petitioners: Respondent averred that petitioners availed of the wrong remedy by filing a petition for certiorari before the Supreme Court, and that a petition for certiorari before the CA is an available remedy despite the NLRC decision becoming final and executory.
• Involuntary Repatriation: Respondent denied requesting repatriation and claimed that petitioners unilaterally decided to repatriate him after learning of his terminal illness.
• Work-Connected Illness: Respondent insisted that he contracted his ailment while working for petitioners in Taiwan and that he incurred expenses for medical treatment and hospitalization.
• Denial of Contractual Benefits: Respondent averred that petitioners should have allowed him to recover in Taiwan before repatriation since he had health care and labor insurance benefits under his employment contract, and that he incurred expenses amounting to P1,500,000.00.

• Propriety of Remedy: Whether petitioners availed of the wrong remedy to assail the CA's decision and resolution.
• Validity of Dismissal: Whether the CA correctly reinstated the September 14, 2012 Decision of the Labor Arbiter, including the legality of respondent's dismissal and the propriety of the monetary awards.

• Propriety of Remedy: Yes. Petitioners availed of the wrong remedy; the proper recourse from a final judgment of the Court of Appeals is a petition for review on certiorari under Rule 45, not a special civil action for certiorari under Rule 65. However, the Court entertained the petition under exceptions for broader interests of justice and oppressive exercise of judicial authority.
• Validity of Dismissal: No. The dismissal was illegal for lack of a valid medical certification from a competent public authority and for failure to comply with the twin-notice requirement of procedural due process. The CA's reinstatement of the LA decision was affirmed with modification as to the monetary awards.

• Propriety of Remedy: A special civil action for certiorari under Rule 65 is available only when there is no appeal or any plain, speedy, and adequate remedy in the ordinary course of law. Since the CA decision and resolution were final judgments disposing of respondent's petition, the proper remedy was a petition for review on certiorari under Rule 45. The Court noted that even if the petition were treated as a Rule 45 petition, it was filed beyond the reglementary period, depriving the Court of jurisdiction over the appeal. Petitioners likewise committed multiple procedural violations: failing to file their position paper before the LA, attaching a defective verification and certification of non-forum shopping before the NLRC, and filing the instant petition through a non-lawyer (Tuazon) on behalf of juridical persons Jerzon and UTC, contrary to Sec. 34 of Rule 138, which requires corporations to be represented by a duly authorized member of the bar. Nevertheless, the Court allowed the Rule 65 petition under exceptions, finding that the absence of concrete justification for the LA and CA's award of P1,000,000.00 as financial assistance constituted an oppressive exercise of judicial authority, and that the broader interest of justice so required.

• Validity of Dismissal: Petitioners failed to prove that respondent voluntarily resigned or requested repatriation; no written notice of resignation was presented, and it was illogical for respondent to seek repatriation when his contract entitled him to health and labor insurance benefits in Taiwan. The Court found that petitioners terminated respondent's employment due to his illness, as his repatriation immediately followed his confinement and dialysis treatments. The CA erred in validating the dismissal under the contract's "unsuitability" clause because petitioners themselves never claimed to have terminated respondent on that basis. Under Philippine labor law, applied via the doctrine of processual presumption because the parties failed to prove the applicable laws of Taiwan, an employer may terminate an employee suffering from a disease only upon certification by a competent public authority that the disease cannot be cured within six months even with proper medical treatment. No such certification was adduced. The twin-notice requirement was likewise violated, as respondent was given no written notice of the ground for his dismissal or of his eventual termination. The dismissal was therefore declared illegal. As to monetary awards, the Court held that the LA and CA erred in limiting respondent's salary award to three months under the "whichever is less" proviso of Sec. 7 of R.A. No. 10022, because in Sameer Overseas Placement vs. Cabiles and Serrano vs. Gallant Maritime, that limitation was struck down as unconstitutional. Respondent was entitled to salaries for the full unexpired portion of his contract, from July 18, 2009 to January 15, 2010, totaling NT$102,528.00. Moral damages of P200,000.00 were warranted by petitioners' oppressive and callous treatment—ignoring his complaints, repatriating him without explanation, refusing medical and financial assistance, and verbally abusing him at their office. Exemplary damages of P200,000.00 were likewise proper to serve as a deterrent, given the wanton and oppressive manner of dismissal and the violation of procedural due process. Financial assistance of P500,000.00 was awarded as compensation for the health insurance benefits contractually owed but never provided, computed with reference to Philhealth's dialysis package under R.A. No. 7875. Attorney's fees of 10% of the total monetary award and legal interest of 6% per annum from finality until full payment were also granted.

• Doctrine of Processual Presumption — Where a foreign law is not pleaded or, even if pleaded, is not proved, the presumption is that the foreign law is the same as Philippine law. Applied in this case because the parties failed to submit the applicable labor laws of Taiwan, despite the employment contract expressly stating that insurance benefits were subject to Taiwan's laws. Philippine labor laws were accordingly applied to determine the validity of respondent's dismissal and his entitlements.

• Termination on the Ground of Disease — Under Art. 299 of the Labor Code (formerly Art. 284), an employer may terminate an employee suffering from a disease whose continued employment is prohibited by law or prejudicial to health, provided there is a certification by a competent public authority that the disease cannot be cured within six months even with proper medical treatment. The burden is on the employer to establish these requisites. Without the required medical certification, the dismissal is illegal. The employer must also comply with the twin-notice requirement: (1) a notice apprising the employee of the ground for dismissal, and (2) a notice informing the employee of the dismissal after a reasonable opportunity to be heard.

• Solidary Liability of Recruitment Agencies — Under Sec. 10 of R.A. No. 8042, as amended by R.A. No. 10022, and the 2002 POEA Rules, DOLE-accredited recruitment agencies are jointly and solidarily liable with their foreign principals for all claims and liabilities arising from the employment contract, including wages, death and disability compensation, and damages. This liability continues during the entire duration of the employment contract and is not affected by substitution, amendment, or modification of the contract. Recruitment agencies have a continuing responsibility to protect the welfare of migrant workers and must ensure that foreign principals comply with their contractual obligations; failure to do so constitutes gross neglect and bad faith.

• Unconstitutionality of the Three-Month Salary Cap — As held in Serrano vs. Gallant Maritime and reiterated in Sameer Overseas Placement vs. Cabiles, the provision limiting the wages recoverable by an illegally dismissed overseas worker to three months for every year of the unexpired term ("whichever is less") violates due process and the equal protection clause. An illegally dismissed OFW is entitled to salaries for the full unexpired portion of the employment contract.

• Entitlement to Health Insurance Benefits — Health insurance benefits contractually granted to an OFW are not dependent on continued employment or on whether the illness is work-connected. The payment of premium contributions activates membership and coverage under the National Health Insurance Program (R.A. No. 7875, as amended), and the employer and recruitment agency may not deny the worker's rights and privileges thereunder.

• "Overseas Filipino workers who are contractually and legally entitled to receive health insurance benefits may not be denied of their rights and privileges under the law, notwithstanding the termination of their employment, or the lack of proof that the illness contracted is work-connected." — This is the opening pronouncement of the decision, articulating the core principle that contractual health insurance entitlements of OFWs survive termination of employment and are not conditioned on the work-connectedness of the illness.

• "Allowing foreign employers to determine for and by themselves whether an overseas contract worker may be dismissed on the ground of illness would encourage illegal or arbitrary pre-termination of [the] employment contract." — This passage articulates the rationale for requiring a medical certification from a competent public authority before an employer may terminate an employee on the ground of disease, preventing unilateral and arbitrary determinations by the employer.

• "The requirement of a medical certificate cannot be dispensed with; otherwise, it would sanction the unilateral and arbitrary determination by the employer of the gravity or extent of the employee's illness and thus defeat the public policy in the protection of labor." — This reinforces the mandatory nature of the medical certification requirement as a safeguard against arbitrary dismissal, grounded in the State's policy of protecting labor.

• "More than just recruiting and deploying OFWs to their foreign principals, recruitment agencies have equally significant responsibilities. In a foreign land where OFWs are likely to encounter uneven if not discriminatory treatment from the foreign government, and certainly a delayed access to language interpretation, legal aid, and the Philippine consulate, the recruitment agencies should be the first to come to the rescue of our distressed OFWs." — Quoted from Becmen Service Exporter and Promotion Inc. vs. Spouses Cuaresma, this passage defines the heightened duty of recruitment agencies toward distressed OFWs and serves as the doctrinal basis for awarding moral and exemplary damages against petitioners.

• Sameer Overseas Placement Agency, Inc. vs. Cabiles, 740 Phil. 403 (2014) — Reiterated the holding in Serrano vs. Gallant Maritime that the three-month salary cap for illegally dismissed OFWs is unconstitutional; applied to hold that respondent was entitled to salaries for the full unexpired portion of his contract rather than only three months.

• Serrano vs. Gallant Maritime, 601 Phil. 245 (2009) — The foundational case striking down the "whichever is less" proviso in Sec. 10 of R.A. No. 8042 as amended by R.A. No. 10022 as violative of due process and equal protection; relied upon to justify awarding full unexpired contract salaries.

• Industrial Personnel & Management Services, Inc. vs. De Vera, 782 Phil. 230 (2016) — Held that OFWs are not stripped of their right to security of tenure, humane conditions of work, and a living wage under the Constitution; applied to reject the CA's finding that respondent was legally dismissed.

• Becmen Service Exporter and Promotion Inc. vs. Spouses Cuaresma, 602 Phil. 1058 (2009) — Awarded P2,500,000.00 each as moral and exemplary damages for the callous treatment of a deceased OFW's family; cited to define the heightened duty of recruitment agencies and to justify the increased damages awards in the present case.

• Corpuz, Jr. vs. Gerwil Crewing Phils., Inc., G.R. No. 205725, January 18, 2021 — Reminded recruitment agencies that their responsibility extends beyond recruitment to the promotion of safety and welfare of OFWs abroad; applied to support the award of moral and exemplary damages.

• Agabon vs. NLRC, 485 Phil. 248 (2004) — Cited by the NLRC for the proposition that nominal damages may be awarded for violation of procedural due process in termination cases.

• Malayang Manggagawa ng Stayfast Phils., Inc. vs. NLRC, 716 Phil. 500 (2013) — Held that the correct remedy to assail a CA decision is a petition for review on certiorari under Rule 45, not a special civil action under Rule 65; applied to find that petitioners availed of the wrong remedy.

• Nacar vs. Gallery Frames, 716 Phil. 267 (2013) — Established the rule that all monetary awards shall earn legal interest of 6% per annum from finality of the decision until full payment; applied to impose the interest on the total monetary award.

• Interorient Maritime Enterprises, Inc. vs. NLRC, 330 Phil. 493 (1996) — Described the oppressive attitude of employers toward sick workers as harking back to the era of serfdom; quoted to characterize petitioners' treatment of respondent.

• International Skill Development, Inc. vs. Montealto, Jr., G.R. No. 237455, October 7, 2020 — Sustained moral and exemplary damages of P100,000.00 each where a foreign employer cancelled an OFW's medical insurance and reported him as an abscondee; cited as a comparable case supporting the damages award.

• Career Philippines Shipmanagement, Inc. vs. Godinez, 819 Phil. 86 (2017) — Affirmed moral and exemplary damages of US$1,000.00 each where a foreign principal failed to properly address an OFW's illness; cited as a comparable case.

• Section 10, Republic Act No. 8042 (Migrant Workers and Overseas Filipinos Act of 1995), as amended by Section 7 of Republic Act No. 10022 — Governs money claims of migrant workers, providing for the solidary and continuing liability of recruitment agencies and foreign principals, and entitling illegally dismissed workers to reimbursement of placement fees with interest and salaries for the unexpired portion of their employment contract. The three-month salary cap ("whichever is less") was declared unconstitutional in Serrano and Sameer, and the Court accordingly awarded full unexpired contract salaries.

• Article 299, Labor Code of the Philippines (formerly Article 284) — Authorizes termination of an employee suffering from a disease whose continued employment is prohibited by law or prejudicial to health, provided there is a certification by a competent public authority that the disease cannot be cured within six months even with proper medical treatment. Applied to hold that petitioners' failure to adduce any medical certification rendered the dismissal illegal.

• Article 300, Labor Code of the Philippines (formerly Article 285) — Governs pre-termination of employment by the employee through written notice of resignation at least one month in advance. Applied to reject petitioners' claim that respondent voluntarily resigned, as no written notice was presented and the burden of proving voluntary resignation rests on the employer.

• Section 1(f)(3), Rule II, Part II, 2002 POEA Rules and Regulations Governing the Recruitment and Employment of Land-Based Overseas Workers — Requires recruitment agencies to execute a verified undertaking that they shall assume joint and solidary liability with the employer for all claims and liabilities arising from the employment contract. Applied to hold petitioners solidarily liable for all monetary awards.

• Republic Act No. 7875 (National Health Insurance Act of 1995), as amended by R.A. No. 9241 and R.A. No. 10606 — Establishes the National Health Insurance Program administered by Philhealth, classifying overseas workers as compulsory members entitled to benefits including dialysis packages. Applied to compute the financial assistance award of P500,000.00, representing the health insurance benefits respondent should have received for his four-year battle with ESRD.

• Section 1, Republic Act No. 8183 — Provides that all monetary obligations shall be settled in Philippine currency, but parties may agree to settle in any other currency at the time of payment. Applied to direct that the peso equivalent of the NT$102,528.00 salary award be computed based on the exchange rate prevailing at the time of payment.

• Article 2208(2), Civil Code of the Philippines — Authorizes the award of attorney's fees where the defendant's act or omission has compelled the plaintiff to litigate to protect his rights. Applied to grant attorney's fees of 10% of the total monetary award.

• Articles 19, 21, and 24, Civil Code of the Philippines — Article 19 requires acting with justice and good faith; Article 21 provides compensation for wilfully caused loss or injury contrary to morals, good customs, or public policy; Article 24 requires courts to be vigilant for the protection of the disadvantaged party. Cited through Becmen to support the award of moral damages.

• Article 2219(10), Civil Code of the Philippines — Allows recovery of moral damages in actions referred to in Article 21. Applied to sanction the grant of moral damages for petitioners' oppressive conduct.

• Section 34, Rule 138, Rules of Court — Allows an individual to conduct litigation in person, but requires juridical persons to be represented by a duly authorized member of the bar. Applied to hold that while Tuazon could represent himself, he could not represent Jerzon and UTC without counsel.

Caguioa, Lazaro-Javier, M. Lopez, and J. Lopez, JJ., concurred.