People of the Philippine Islands vs. Julio Pomar

The provisions of Section 13 of Act No. 3071, requiring employers to grant pregnant women laborers thirty days paid vacation before and thirty days after confinement, are unconstitutional and void as an arbitrary interference with the liberty of contract guaranteed by the due process clause of the organic law. The police power of the state, however broad and expanding, cannot contravene the express provisions of the fundamental law, and a statute that creates a term in every employment contract without the consent of the parties deprives employers of their liberty to contract.

The case arose under Act No. 3071 of the Philippine Legislature, a labor statute enacted in the exercise of the police power with the purpose of safeguarding the health of pregnant women laborers in factories, shops, or places of labor, and insuring to them reasonable support for one month before and one month after delivery. The constitutional question presented was whether the statute constituted a reasonable and lawful exercise of the police power, which the Court examined against the backdrop of the due process clause of the first paragraph of Section 3 of the Act of Congress of the United States of August 29, 1916, the organic law of the Philippine Islands. The case also drew upon American constitutional jurisprudence on the liberty of contract, including the recently decided Adkins vs. Children's Hospital case.

Julio Pomar was the manager and person in charge of La Flor de la Isabela, a tobacco factory pertaining to La Campania General de Tabacos de Filipinas, a corporation duly authorized to transact business in the City of Manila. During the year 1923, he had in his employ and service as a cigar-maker a woman named Macaria Fajardo, whom he granted vacation leave beginning on the 16th day of July, 1923, by reason of her pregnancy. Fajardo's delivery and confinement took place on the 12th day of August, 1923.

The complaint alleged that Pomar willfully, unlawfully, and feloniously failed and refused to pay Fajardo the sum of eighty pesos (P80), Philippine currency, to which she was entitled as her regular wages corresponding to thirty days before and thirty days after her delivery and confinement, despite demands made upon him to do so. The defendant demurred to the complaint, alleging that the facts contained therein did not constitute an offense. The demurrer was overruled, whereupon the defendant answered and admitted at trial all of the allegations contained in the complaint, but contended that the provisions of Act No. 3071 upon which the complaint was based were illegal, unconstitutional, and void.

Section 13 of Act No. 3071 provided that every person, firm, or corporation owning or managing a factory, shop, or place of labor of any description shall be obliged to grant to any woman employed by it as laborer who may be pregnant, thirty days vacation with pay before and another thirty days after confinement, with a proviso that the employer shall not discharge such laborer without just cause, under the penalty of being required to pay to her wages equivalent to the total of two months counted from the day of her discharge. Section 15 of the same Act provided for the penalty of a fine of not less than fifty pesos nor more than two hundred and fifty, or imprisonment for not less than ten days nor more than six months, or both, in the discretion of the court, and made the presidents, directors, or managers of firms or corporations criminally responsible for each violation.

• Unconstitutionality of the Statute: The defendant-appellant argued that the provisions of Act No. 3071, upon which the complaint was based, were illegal, unconstitutional, and void, and that the court erred in overruling the demurrer and in convicting him of the crime charged.
• Error in Conviction: The appellant contended that the court erred in convicting him of the crime charged in the information and in not declaring Section 13 of Act No. 3071 unconstitutional.

• Validity of the Police Power Exercise: The Attorney-General, representing the appellee, maintained the validity of the conviction, asserting that Section 13 of Act No. 3071 was a reasonable and lawful exercise of the police power of the state, enacted with the praiseworthy purpose of safeguarding the health of pregnant women laborers and insuring to them reasonable support for one month before and one month after their delivery.

• Constitutionality of the Statute: Whether the provisions of sections 13 and 15 of Act No. 3071 are a reasonable and lawful exercise of the police power of the state.
• Liberty of Contract: Whether Section 13 of Act No. 3071, which compels employers to pay pregnant women laborers wages for thirty days before and thirty days after confinement, constitutes an unconstitutional deprivation of the liberty of contract without due process of law.

• Constitutionality of the Statute: No. The provisions of Section 13 of Act No. 3071 are unconstitutional and void, as they violate and are contrary to the provisions of the first paragraph of Section 3 of the Act of Congress of the United States of August 29, 1916, which guarantees due process of law.
• Liberty of Contract: Yes. The law deprives every person, firm, or corporation owning or managing a factory, shop, or place of labor of the right to enter into contracts of employment upon such terms as the employer and employee may agree upon, creating a term in every such contract without the consent of the parties, thereby depriving them of their liberty to contract.

• Constitutionality of the Statute: The Court examined numerous definitions of the police power, from Blackstone, Bentham, Justice Cooley, and Justice Shaw in Commonwealth of Massachusetts vs. Alger, and its own decision in Case vs. Board of Health and Heiser. The Court concluded that while the police power is a growing and expanding power that cannot be clearly and definitely defined and circumscribed, it cannot grow faster than the fundamental law of the state, nor transcend or violate the express inhibition of the people's law — the constitution. The state, when providing by legislation for the protection of the public health, public morals, or public safety, is subject to and controlled by the paramount authority of the constitution and will not be permitted to violate rights secured or guaranteed by that instrument. If the people desire to have the police power extended and applied to conditions and things prohibited by the organic law, they must first amend that law.

• Liberty of Contract: The Court applied the doctrine from Adkins vs. Children's Hospital of the District of Columbia, which held that the right to contract about one's own affairs is a part of the liberty of the individual under the constitution, and that while there is no such thing as absolute freedom of contract, none of the exceptional circumstances which at times justify a limitation upon one's right to contract for his own services applied in the particular case. The Court found that Section 13 of Act No. 3071 was exactly analogous to the Minimum Wage Act struck down in Adkins. The statute creates a term or condition in every contract made by every person, firm, or corporation with any woman who may, during the course of her employment, become pregnant, and a failure to include in said contract the terms fixed leads to fine and imprisonment. The law takes no account of contracts for the employment of women by the day nor by the piece, and it would hardly be contended that an employer who employs women by the day or by the piece could be compelled under the law to pay for sixty days during which no services were rendered. The Court cited a long line of decisions of the Supreme Court of the United States holding that the right to contract about one's affairs is a part of the liberty of the individual protected by the due process of law clause, including Allgeyer vs. Louisiana, New York Life Ins. Co. vs. Dodge, Coppage vs. Kansas, Adair vs. United States, Lochner vs. New York, and Muller vs. Oregon. The Court also noted the rule in this jurisdiction, under Article 1255 of the Civil Code, that contracting parties may establish any agreements, terms, and conditions they may deem advisable, provided they are not contrary to law, morals, or public policy.

• Police Power and Constitutional Limits — The police power is a growing and expanding power vested in the legislature to make, ordain, and establish all manner of wholesome and reasonable laws, statutes, and ordinances, either with penalties or without, not repugnant to the constitution, as the legislature shall judge to be for the good and welfare of the commonwealth. However, the state, when providing by legislation for the protection of the public health, public morals, or public safety, is subject to and controlled by the paramount authority of the constitution and will not be permitted to violate rights secured or guaranteed by that instrument. The police power cannot grow faster than the fundamental law of the state, nor transcend or violate the express inhibition of the people's law — the constitution. If the people desire to have the police power extended and applied to conditions and things prohibited by the organic law, they must first amend that law.

• Liberty of Contract — The right to contract about one's affairs is a part of the liberty of the individual protected by the due process of law clause of the constitution. The right of a person to sell his labor upon such terms as he deems proper is, in its essence, the same as the right of the purchaser of labor to prescribe the conditions upon which he will accept such labor from the person offering to sell. In all such particulars, the employer and the employee have equality of right, and any legislation that disturbs that equality is an arbitrary interference with the liberty of contract, which no government can legally justify in a free land under a constitution which provides that no person shall be deprived of his liberty without due process of law. Liberty includes not only the right to labor, but to refuse to labor, and, consequently, the right to contract to labor or for labor, and to terminate such contracts, and to refuse to make such contracts.

• Deprivation of Property Under Police Power — Individuals may be deprived of their property under the police power of the state without compensation only in cases where the property in question was used for the purpose of violating some legally adopted law or constitutes a nuisance, such as apparatus used in counterfeiting, firearms illegally possessed, opium possessed in violation of law, apparatus used for gambling in violation of law, and buildings and property used for the purpose of violating laws prohibiting the manufacture and sale of intoxicating liquors. It must first be established that such property was used as the instrument for the violation of a valid existing law.

• "The police power of the state is a growing and expanding power. As civilization develops and public conscience becomes awakened, the police power may be extended, as has been demonstrated in the growth of public sentiment with reference to the manufacture and sale of intoxicating liquors. But that power cannot grow faster than the fundamental law of the state, nor transcend or violate the express inhibition of the people's law — the constitution." — This passage articulates the Court's central limitation on the police power: it must yield to the express provisions of the organic law, and expansion of the power requires constitutional amendment, not legislative action.

• "Clearly, therefore, the law has deprived, every person, firm, or corporation owning or managing a factory, shop or place of labor of any description within the Philippine Islands, of his right to enter into contracts of employment upon such terms as he and the employee may agree upon. The law creates a term in every such contract, without the consent of the parties. Such persons are, therefore, deprived of their liberty to contract. The constitution of the Philippine Islands guarantees to every citizen his liberty and one of his liberties is the liberty to contract." — This is the ratio decidendi of the case, identifying the precise constitutional defect in Section 13 of Act No. 3071: the statute's imposition of a contractual term without the parties' consent constitutes a deprivation of liberty without due process of law.

• "In all such particulars the employer and the employee have equality of right, and any legislation that disturbs that equality is an arbitrary interference with the liberty of contract, which no government can legally justify in a free land, under a constitution which provides that no person shall be deprived of his liberty without due process of law." — The Court adopts this formulation from Adair vs. United States to establish the standard for evaluating legislation that interferes with freedom of contract, emphasizing the equality of right between employer and employee.

• Adkins vs. Children's Hospital of the District of Columbia, 261 U. S., 525 — Controlling precedent. The Court applied this case's holding that a minimum wage law for women was void because the right to contract about one's own affairs is a part of the liberty of the individual under the constitution, finding Section 13 of Act No. 3071 "exactly analogous" to the Minimum Wage Act struck down therein.
• Case vs. Board of Health and Heiser, 24 Phil., 250 — Followed. This Philippine case was cited for the proposition that the state, under the police power, is possessed with plenary power to deal with all matters relating to the general health, morals, and safety of the people, so long as it does not contravene any positive inhibition of the organic law.
• Commonwealth of Massachusetts vs. Alger, 7 Cushing, 53 — Cited for Justice Shaw's comprehensive definition of the police power, including the principle that every holder of property holds it under the implied liability that his use of it may be regulated so that it shall not be injurious to the rights of the community.
• Mugler vs. Kansas, 123 U. S., 623 — Cited for the proposition that the state, when providing by legislation for the protection of the public health, public morals, or public safety, is subject to and controlled by the paramount authority of the constitution.
• Coppage vs. Kansas, 235 U. S., 1 — Cited for the principle that included in the right of personal liberty and the right of private property is the right to make contracts for the acquisition of property, chief among which is that of personal employment.
• Adair vs. United States, 208 U. S., 161 — Cited for the proposition that the right of a person to sell his labor upon such terms as he deems proper is the same as the right of the purchaser of labor to prescribe the conditions upon which he will accept such labor, and that legislation disturbing that equality is an arbitrary interference with the liberty of contract.
• Gillespie vs. People, 118 Ill., 176 — Cited for the holding that a statute making it unlawful to discharge an employee because of his connection with any lawful labor organization is void, since the right to terminate a contract is within the protection of the constitution.
• Allgeyer vs. Louisiana, 165 U. S., 578 — Cited in the line of decisions holding that the right to contract about one's affairs is a part of the liberty of the individual protected by the due process of law clause.
• Lochner vs. New York, 198 U. S., 45 — Cited in the line of decisions on the liberty of contract protected by the due process clause.
• Muller vs. Oregon, 208 U. S., 412 — Cited in the line of decisions on the liberty of contract protected by the due process clause.

• Section 3, Act of Congress of the United States of August 29, 1916 (Vol. 12, Public Laws, p. 238) — The organic law of the Philippine Islands containing the due process clause. The Court held that Section 13 of Act No. 3071 violated and was contrary to the first paragraph of this section, which guarantees that no person shall be deprived of life, liberty, or property without due process of law.
• Section 13, Act No. 3071 — The statute under review, requiring employers to grant pregnant women laborers thirty days vacation with pay before and another thirty days after confinement, and prohibiting discharge without just cause under penalty of paying two months' wages. Declared unconstitutional and void.
• Section 15, Act No. 3071 — The penal provision imposing a fine of not less than fifty pesos nor more than two hundred and fifty, or imprisonment for not less than ten days nor more than six months, or both, and making presidents, directors, or managers of firms or corporations criminally responsible for violations. Rendered inoperative as to Section 13.
• Article 1255, Civil Code — Cited for the rule in this jurisdiction that contracting parties may establish any agreements, terms, and conditions they may deem advisable, provided they are not contrary to law, morals, or public policy.

Street, Malcolm, Avanceña, Villamor, Ostrand, and Romualdez, JJ., concurred in the decision.