Unica vs. Anscor Swire Ship Management Corporation

A seafarer's employment contract is not impliedly renewed by the mere fact that he remains on board a vessel after the contract's expiration date, where the delay in disembarkation is due to the vessel being at sea and no mutually-agreed renewal or extension exists. The seafarer is, however, entitled to earned wages and benefits for the period of continued service until the vessel's arrival at a convenient port, as provided under the standard repatriation clause.

Petitioner Antonio E. Unica is a Filipino seafarer who had been employed by respondent Anscor Swire Ship Management Corporation, a manning agency, under various contracts since the late 1980s. Seafarers are considered contractual employees whose employment is governed by the contracts they sign each time they are rehired, and their employment is terminated when the contract expires. The standard terms and conditions governing the employment of Filipino seafarers on-board ocean-going vessels include a repatriation provision that addresses the situation where a vessel is outside the Philippines upon the expiration of the contract.

Petitioner Antonio E. Unica was employed by respondent Anscor Swire Ship Management Corporation, a manning agency, under various contracts since the late 1980s. In his last contract, petitioner was deployed for a period of nine months, from January 29, 2000 to October 25, 2000. However, because the vessel was still at sea, petitioner was only repatriated on November 14, 2000, or twenty days after the expiration of his contract of employment.

Petitioner averred that since he was allowed to stay in the vessel for another twenty days, there was an implied renewal of his contract of employment. Hence, when he was repatriated on November 14, 2000 without a valid cause, he was illegally dismissed. Respondent, in its defense, argued that petitioner was hired for a fixed period, the duration of which depends upon the mutual agreement of the parties, and that his employment was co-terminus with the term of his contract. Respondent maintained that petitioner was repatriated due to the completion of the term of his contract.

The Labor Arbiter ruled in favor of petitioner, holding that since petitioner was not repatriated at the expiration of his contract on October 25, 2000, and was allowed by respondent to continue working on board its vessel up to November 14, 2000, his contract was impliedly renewed for another nine months. The NLRC affirmed with modification, likewise ruling that the contract was impliedly extended for another nine months because it was only on November 14, 2000 when petitioner was told to disembark. The Court of Appeals, however, annulled and set aside the NLRC decision, ruling that there was no implied renewal of contract and that the twenty-day extension was due to the fact that the ship was still at sea.

• Implied Renewal: Petitioner argued that since he was allowed to stay in the vessel for another twenty days after the expiration of his contract, there was an implied renewal of his contract of employment, and that when he was repatriated on November 14, 2000 without a valid cause, he was illegally dismissed.
• Entitlement to Benefits: Petitioner filed a case against respondent for illegal dismissal, payment of retirement, disability and medical benefits, separation and holiday pay.

• Fixed-Term Employment: Respondent argued that petitioner was hired for a fixed period, the duration of which depends upon the mutual agreement of the parties, and that petitioner's employment was co-terminus with the term of his contract.
• Completion of Contract: Respondent maintained that the claim of petitioner that he was illegally dismissed must fail, because he was repatriated due to the completion of the term of his contract.

• Implied Renewal of Contract: Whether there was an implied renewal of petitioner's contract of employment with respondent when petitioner remained on board the vessel for twenty days after the expiration of his contract.

• Implied Renewal of Contract: No. There was no implied renewal of petitioner's contract of employment. A seafarer's employment is contractually fixed for a certain period of time, and when petitioner's contract ended on October 25, 2000, his employment was deemed automatically terminated, there being no mutually-agreed renewal or extension of the expired contract. However, petitioner was entitled to be paid his wages after the expiration of his contract until the vessel's arrival at a convenient port, pursuant to Section 19 of the Standard Terms and Conditions Governing the Employment of Filipino Seafarers On-Board Ocean-Going Vessels.

• Implied Renewal of Contract: The Court ruled that although petitioner's employment contract ended on October 25, 2000 and he disembarked only on November 14, 2000, or barely twenty days after the expiration of his employment contract, such late disembarkation was not without valid reason. Respondent could not have disembarked petitioner on the date of the termination of his employment contract, because the vessel was still in the middle of the sea. It was impossible for petitioner to safely disembark immediately upon the expiration of his contract, since he must disembark at a convenient port. Thus, petitioner's stay in the vessel for another twenty days should not be interpreted as an implied extension of his contract. The Court cited the settled rule that a seaman need not physically disembark from a vessel at the expiration of his employment contract to have such contract considered terminated. Seafarers are considered contractual employees, and their employment is governed by the contracts they sign every time they are rehired, and their employment is terminated when the contract expires. Their employment is contractually fixed for a certain period of time. Thus, when petitioner's contract ended on October 25, 2000, his employment was deemed automatically terminated, there being no mutually-agreed renewal or extension of the expired contract. However, the Court held that petitioner was entitled to be paid his wages after the expiration of his contract until the vessel's arrival at a convenient port, citing Section 19 of the Standard Terms and Conditions Governing the Employment of Filipino Seafarers On-Board Ocean-Going Vessels, which provides that if the vessel is outside the Philippines upon the expiration of the contract, the seafarer shall continue his service on board until the vessel's arrival at a convenient port and/or after arrival of the replacement crew, provided that the continuance of such service shall not exceed three months, and the seafarer shall be entitled to earned wages and benefits as provided in his contract.

• Contractual Employment of Seafarers — Seafarers are considered contractual employees whose employment is governed by the contracts they sign every time they are rehired, and their employment is terminated when the contract expires. Their employment is contractually fixed for a certain period of time. The Court applied this doctrine to hold that petitioner's employment was automatically terminated upon the expiration of his contract on October 25, 2000, there being no mutually-agreed renewal or extension.
• No Implied Renewal from Continued Stay On Board — A seaman need not physically disembark from a vessel at the expiration of his employment contract to have such contract considered terminated. The Court applied this rule to hold that petitioner's stay in the vessel for another twenty days should not be interpreted as an implied extension of his contract, since the late disembarkation was due to the vessel being at sea and it was impossible for petitioner to safely disembark immediately upon the expiration of his contract.
• Repatriation Wages — Under Section 19 of the Standard Terms and Conditions Governing the Employment of Filipino Seafarers On-Board Ocean-Going Vessels, if the vessel is outside the Philippines upon the expiration of the contract, the seafarer shall continue his service on board until the vessel's arrival at a convenient port and/or after arrival of the replacement crew, provided that the continuance of such service shall not exceed three months, and the seafarer shall be entitled to earned wages and benefits as provided in his contract. The Court applied this provision to award petitioner his salary from October 26, 2000 until November 14, 2000.

• "A seaman need not physically disembark from a vessel at the expiration of his employment contract to have such contract considered terminated." — This passage states the controlling rule that physical disembarkation is not required for the termination of a seafarer's contract, which is the basis for rejecting the implied renewal theory.
• "It is a settled rule that seafarers are considered contractual employees. Their employment is governed by the contracts they sign everytime they are rehired and their employment is terminated when the contract expires. Their employment is contractually fixed for a certain period of time." — This passage defines the contractual nature of seafarer employment, which is the foundational doctrine applied to determine that petitioner's employment automatically terminated upon contract expiration.
• "REPATRIATION. A. If the vessel is outside the Philippines upon the expiration of the contract, the seafarer shall continue his service on board until the vessel's arrival at a convenient port and/or after arrival of the replacement crew, provided that, in any case, the continuance of such service shall not exceed three months. The seafarer shall be entitled to earned wages and benefits as provided in his contract." — This passage is the standard repatriation provision that serves as the legal basis for awarding petitioner his wages for the period after contract expiration until repatriation.

• Delos Santos vs. Jebsen Maritime, Inc., 512 Phil. 301, 313 (2005) — Cited as authority for the rule that a seaman need not physically disembark from a vessel at the expiration of his employment contract to have such contract considered terminated.
• Millares vs. National Labor Relations Commission, 434 Phil. 524, 537-538 (2002) — Cited as authority for the settled rule that seafarers are contractual employees whose employment is governed by the contracts they sign every time they are rehired and is terminated when the contract expires.

• Section 19, Standard Terms and Conditions Governing the Employment of Filipino Seafarers On-Board Ocean-Going Vessels — The repatriation provision which provides that if the vessel is outside the Philippines upon the expiration of the contract, the seafarer shall continue his service on board until the vessel's arrival at a convenient port and/or after arrival of the replacement crew, provided that the continuance of such service shall not exceed three months, and the seafarer shall be entitled to earned wages and benefits as provided in his contract. The Court applied this provision to award petitioner his salary from October 26, 2000 until November 14, 2000.
• Rule 45, Rules of Court — The procedural rule under which the petition for review on certiorari was filed, seeking to set aside the Decision and Resolution of the Court of Appeals.

Presbitero J. Velasco, Jr. (Chairperson), Roberto A. Abad, Jose Catral Mendoza, and Marvic Mario Victor F. Leonen.