Orate vs. Court of Appeals

For a sickness not listed as an occupational disease under Annex "A" of the Rules on Employees' Compensation to be compensable under the Labor Code (as amended by PD No. 626), the claimant must prove by substantial evidence that the risk of contracting the disease was increased by working conditions; where no evidence shows the disease was contracted before January 1, 1975, the presumption is that the Labor Code governs, and the presumption of compensability under the repealed Workmen's Compensation Act does not apply.

Petitioner Norma Orate was employed as a regular machine operator by Manila Bay Spinning Mills, Inc. on December 5, 1972, performing duties that included doffing, creeling, repair breaks, and machine cleaning. The governing law on employees' compensation underwent a fundamental shift when the Workmen's Compensation Act (Act No. 3428), which operated upon a presumption of compensability placing the burden on the employer to disprove work-connection, was repealed by the Labor Code (Presidential Decree No. 442) on November 1, 1974, and extensively amended by Presidential Decree No. 626, effective January 1, 1975. The amended regime discarded the presumption of compensability and the concept of aggravation, substituting a social-security-based system administered by the SSS and GSIS under the ECC, which requires the claimant to prove a positive proposition — that the illness was caused by employment or that working conditions increased the risk of contracting the disease.

On December 5, 1972, Norma Orate was employed by Manila Bay Spinning Mills, Inc. as a regular machine operator. Her duties encompassed doffing (obtaining empty cones, preparing them on spindles, doffing full cones, and reloading), creeling (removing empty bobbins, fitting full cops to creel pins, threading to guides, and jointing ends), repair breaks (patrolling for break-ends, stopping spindles, threading and jointing ends), and machine cleaning duties performed once per shift at the start of the shift, including brushing the machine ends, creel bar, and frame beam.

On March 22, 1995, Orate was diagnosed with invasive ductal carcinoma of the left breast, commonly known as breast cancer. She underwent modified radical mastectomy on June 9, 1995. The operation incapacitated her from performing heavy work, forcing her to go on leave and eventually retire from service at the age of forty-four.

On November 17, 1995, Orate applied for employees' compensation benefits with the SSS, but the application was denied on the ground that her illness is not work-related. She moved for reconsideration on January 22, 1996, contending that her duties as a machine operator, which included lifting heavy objects, increased the risk of contracting breast cancer, and that her work in the winding department exposed her to cancer-causing dyes used in coloring threads. The SSS reiterated its denial of the claim under the Employees' Compensation Program but approved her application as a sickness benefit claim under the SSS, classifying it as permanent partial disability equivalent to twenty-three months.

Orate requested the elevation of her case to the ECC, which affirmed the SSS decision on June 20, 1996, ruling that her disability due to breast cancer is not compensable because the ailment is not included among the occupational diseases under Annex "A" of the Rules on Employees' Compensation and because it was not established that the risk of contracting the ailment was increased by her working conditions. She then filed a petition for review with the Court of Appeals, which reversed the ECC on May 14, 1997, applying the Workmen's Compensation Act on the reasoning that the disease must have intervened before January 1, 1975, thus triggering the presumption of compensability. Orate moved for reconsideration, arguing that the Labor Code should apply since there was no evidence the onset of her cancer occurred before January 1, 1975, and that the computation of benefits should be based on the Labor Code. The Court of Appeals denied the motion on January 29, 1998, prompting the instant petition.

• Applicable Law: Petitioner insisted that the Labor Code, not the Workmen's Compensation Act, should govern her claim because there was no evidence that the onset of her breast carcinoma occurred before January 1, 1975, and that the basis for computing her compensation benefits should be the Labor Code.
• Work-Connection of Illness: Petitioner argued before the SSS and the ECC that her job as a machine operator, which required lifting heavy objects, increased the risk of contracting breast carcinoma, and that her work in the winding department exposed her to cancer-causing dyes used in coloring threads, citing an encyclopedia entry on industrial chemicals that create cancer hazards.

• Non-Compensability of Illness: Respondent ECC ruled and maintained that petitioner's disability due to breast cancer is not compensable under the Employees' Compensation Program because the ailment is not included among the occupational diseases under Annex "A" of the Rules on Employees' Compensation, and it was not established that the risk of contracting the ailment was increased by working conditions at Manila Bay Spinning Mills, Inc.
• Applicable Law: Respondent Court of Appeals, while ruling in petitioner's favor on entitlement, applied the Workmen's Compensation Act rather than the Labor Code, reasoning that the disease must have intervened before January 1, 1975.

• Applicable Law: Whether the Workmen's Compensation Act (Act No. 3428) or the Labor Code, as amended by PD No. 626, governs petitioner's claim for disability benefits.
• Entitlement to Compensation: Whether petitioner is entitled to compensation for disability arising from breast carcinoma under the applicable law.

• Applicable Law: Yes — the Labor Code, as amended by PD No. 626, governs. Where a claim is filed after January 1, 1975 without any showing as to when the disease was contracted, the presumption is that the disease was contracted after the effectivity of PD No. 626.
• Entitlement to Compensation: No. Breast cancer is not a listed occupational disease under Annex "A," and petitioner failed to prove by substantial evidence that her working conditions increased the risk of contracting the disease.

• Applicable Law: The governing law in workmen's compensation cases is determined by the date when the claimant contracted the disease. An illness that intervened prior to January 1, 1975 is governed by the Workmen's Compensation Act, while those contracted on or after that date are governed by the Labor Code as amended by PD No. 626. Correlatively, where a claim is filed after the effectivity of PD No. 626 without any showing as to when the disease intervened, the presumption is that the disease was contracted after PD No. 626's effectivity. Petitioner was diagnosed with breast cancer on March 22, 1995, and no evidence was presented as to when she contracted the ailment. The case was therefore not on all fours with prior cases (Avendaño, Cayco, Ajero, Mandapat, Nemaria, De Leon) where the presumption of compensability under the Workmen's Compensation Act was applied despite claims filed after January 1, 1975, because in those cases the symptoms or treatment of breast cancer manifested before or too close to the cut-off date, making it logical to presume the disease intervened prior to January 1, 1975. Here, the Court declined to surmise that the onset of petitioner's breast carcinoma occurred almost twenty years before her 1995 diagnosis, there being no expert basis for such a presumption.

• Entitlement to Compensation: Under the Labor Code as amended by PD No. 626, for breast carcinoma and resulting disability to be compensable, the claimant must prove by substantial evidence either (a) that the sickness was the result of an occupational disease listed under Annex "A" of the Rules on Employees' Compensation, or (b) if the sickness is not so listed, that the risk of contracting the disease was increased by the claimant's working conditions. Breast cancer is undisputedly not listed as an occupational disease under Annex "A," placing the burden on petitioner to prove the causal relationship between her illness and her working conditions. Substantial evidence means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. Petitioner's bare allegations that her job required lifting heavy objects and exposed her to cancer-causing dyes, supported only by a vague encyclopedia excerpt on industrial chemicals, did not constitute substantial evidence. A perusal of the records revealed no evidence that she was indeed exposed to dyes, and even assuming direct exposure to chemicals, there was no proof that the company failed to implement measures to control the hazards. Cancer is a disease that strikes people in general, regardless of the nature of employment, and while certain cancers are reasonably considered strongly induced by specific causes (e.g., heavy radiation, cigarette smoke, asbestos dust), the law requires proof for others — proof that was not satisfied here. Awards of compensation cannot rest on speculation and presumptions; the claimant must prove a positive proposition. The Court further noted that paying benefits to claimants not entitled under law endangers the integrity of the State Insurance Fund, which tens of millions of workers and their families rely upon for covered accidents, diseases, and deaths.

• Presumption of Governing Law in Employees' Compensation Claims — Where a claim for compensation benefit is filed after the effectivity of PD No. 626 (January 1, 1975) without any showing as to when the disease intervened, the presumption is that the disease was contracted after the effectivity of PD No. 626, and the Labor Code governs. This presumption may be overcome only by evidence that the disease or its symptoms manifested before or too close to January 1, 1975, making it logical to presume the illness intervened prior to the cut-off date, as illustrated in cases such as Avendaño vs. Employees' Compensation Commission, Cayco vs. Employees' Compensation Commission, Ajero vs. Employees' Compensation Commission, Mandapat vs. Employees' Compensation Commission, Nemaria vs. Employees' Compensation Commission, and De Leon vs. Employees' Compensation Commission.

• Burden of Proof for Unlisted Illnesses Under the Labor Code (PD No. 626) — For a sickness not listed as an occupational disease under Annex "A" of the Rules on Employees' Compensation to be compensable, the claimant must prove by substantial evidence that the risk of contracting the disease was increased by working conditions. Substantial evidence is such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. Bare allegations, vague encyclopedia excerpts, and speculative assertions do not satisfy this standard. The presumption of compensability and the concept of aggravation under the repealed Workmen's Compensation Act have no application under the present regime.

• Protection of the State Insurance Fund — Compassion for victims of diseases not covered by law cannot justify an award not authorized by law, because it is the trust fund — not the employer — that suffers if benefits are paid to claimants who are not entitled under the law. The development in employees' compensation law has eliminated the lopsided situation of an employee arrayed against a powerful corporate employer, which previously necessitated favorable presumptions for the claimant; the State Insurance Fund must be preserved for covered accidents, diseases, and deaths.

• "The law as it now stands requires the claimant to prove a positive thing – that the illness was caused by employment and the risk of contracting the disease is increased by the working conditions." — This passage encapsulates the fundamental shift from the presumption of compensability under the Workmen's Compensation Act to the burden-of-proof regime under the Labor Code as amended by PD No. 626, and is the analytical pivot of the decision.

• "Corollarily, where the claim for compensation benefit was filed after the effectivity of P.D. No. 626 without any showing as to when the disease intervened, the presumption is that the disease was contracted after the effectivity of P.D. No. 626." — This states the controlling presumption for determining the applicable law when the date of contraction is unknown, a principle frequently cited in subsequent employees' compensation jurisprudence.

• "Awards of compensation cannot rest on speculations and presumptions. The claimant must prove a positive proposition." — This formulation articulates the evidentiary standard under the amended Labor Code regime, distinguishing it from the repealed presumption of compensability and emphasizing the claimant's affirmative burden.

• "Compassion for the victims of diseases not covered by law ignores the need to show a greater concern for the trust fund to which the tens of millions of workers and their families look to for compensation whenever covered accidents, diseases and deaths occur." — This passage articulates the policy rationale for strict adherence to statutory entitlement requirements, underscoring that the State Insurance Fund, not the employer, bears the cost of improper awards.

• Sarmiento vs. Employees' Compensation Commission, G.R. No. L-65680, May 11, 1988, 161 SCRA 312 — Explained the nature of the new employees' compensation scheme under PD No. 626, including the social-security-based system, the abolition of the presumption of compensability and controversion rules, and the role of the State Insurance Fund. Followed as authoritative exposition of the amended regime.

• Avendaño vs. Employees' Compensation Commission, G.R. No. L-48593, April 30, 1980, 97 SCRA 464 — Applied the Workmen's Compensation Act to a breast cancer claim filed in 1976 because the disease was contracted in 1959 with clinical manifestations starting in 1969. Distinguished from the instant case, where no evidence showed the disease intervened before January 1, 1975.

• Cayco vs. Employees' Compensation Commission, G.R. No. L-49755, August 21, 1980, 99 SCRA 268 — Applied the presumption of compensability under the Workmen's Compensation Act where breast carcinoma first appeared in 1972, before the Labor Code took effect. Distinguished.

• Ajero vs. Employees' Compensation Commission, G.R. No. L-44597, December 29, 1980, 101 SCRA 868 — Held that ailments including breast cancer must have supervened several years before 1976, when the Workmen's Compensation Act was still in force. Distinguished.

• Mandapat vs. Employees' Compensation Commission, 191 Phil. 47 (1981) — Noted that the onset of cancer is quiet and gradual, taking six to twelve months for breast cancer to grow from a detectable size to the size encountered at surgery, supporting application of the Workmen's Compensation Act where mastectomy was performed in May 1975. Distinguished.

• Nemaria vs. Employees' Compensation Commission, G.R. No. L-57889, October 28, 1987, 155 SCRA 166 — Recognized that cancer is often discovered when it is too late and surmised that onset could have been before the Labor Code's effectivity. Distinguished.

• De Leon vs. Employees' Compensation Commission, G.R. No. L-46474, November 14, 1988, 167 SCRA 342 — Applied the Workmen's Compensation Act where a modified radical mastectomy in September 1968 showed the disease was contracted before PD No. 626. Distinguished.

• Raro vs. Employees' Compensation Commission, G.R. No. 58445, April 27, 1989, 172 SCRA 845 — Articulated the nature of the present employees' compensation system and the principle that cancer strikes people in general regardless of employment. Followed.

• Riño vs. Employees' Compensation Commission, G.R. No. 132558, May 9, 2000, 331 SCRA 596 — Held that awards of compensation cannot rest on speculation and presumptions and that the claimant must prove a positive proposition. Followed.

• Government Service Insurance System vs. Court of Appeals, 357 Phil. 511 (1998) — Set forth the two conditions for compensability of an unlisted illness and the policy rationale for protecting the State Insurance Fund. Followed.

• Act No. 3428 (Workmen's Compensation Act) — The first law on workmen's compensation in the Philippines, effective June 10, 1928, which operated upon the presumption of compensability: if the injury or disease arose out of and in the course of employment, the claim was presumed compensable, and the employer bore the burden of proving otherwise. Repealed by the Labor Code on November 1, 1974; held inapplicable to petitioner's claim because her disease was presumed contracted after January 1, 1975.

• Presidential Decree No. 442 (Labor Code), Title II, Book IV, as amended by Presidential Decree No. 626 — Effective January 1, 1975; extensively amended the provisions on Employees' Compensation and the State Insurance Fund. Discarded the presumption of compensability and the concept of aggravation, substituting a social-security-based system requiring the claimant to prove that the illness was caused by employment or that working conditions increased the risk of contracting the disease. Held to be the governing law on petitioner's claim.

• Annex "A" of the Rules on Employees' Compensation — Lists occupational diseases for which compensation is automatically payable without proof of causation. Breast cancer is not included among the listed occupational diseases, placing on petitioner the burden of proving by substantial evidence that her working conditions increased the risk of contracting the disease.

Davide, Jr., C.J., Vitug, Carpio, and Azcuna, JJ., concurred.