Supreme Court upholds equal protection of illegally dismissed OFWs

MANILA, Philippines – A seafarer won $26,442.73 in wages for the nine months and 23 days that he would have spent on board ship after the Supreme Court declared as unconstitutional a clause in Republic Act 8042, the Migrant Workers and Overseas Filipinos Act, limiting the money claims of overseas Filipino workers.

Seafarer Antonio Serrano had served two months and seven days of his 12-month contract when he was repatriated.

In a landmark decision, the SC said it was unfair for Section 10 of RA 8042 to grant illegally dismissed OFWs salaries for the unexpired portion of their employment contracts or for three months for every year of the unexpired term, whichever is less.

“A closer examination reveals that the subject clause has a discriminatory intent against, and an invidious impact on OFWs at two levels: first, OFWs with employment contracts of less than one year vis-à-vis OFWs with employment contracts of one year or more and second, among OFWs with employment contracts of more than one year and OFWs vis-à-vis local workers with fixed period employment,” read the SC decision.

The assailed clause had “introduced a differentiated rule of computation of the money claims of illegally dismissed OFWs based on their employment periods, in the process singling out one category whose contracts have an unexpired portion of one year or more and subjecting them to the peculiar disadvantage of having their monetary awards limited to their salaries for three months or for the unexpired portion or whichever is less, but all the while sparing the other category from such prejudice, simply because the latter’s unexpired contract falls short of one year,” according to the SC.

The case arose from a complaint for “constructive dismissal” filed by Serrano against Gallant Maritime Services, Inc. and Marlow Navigation Co., Ltd.

Serrano was hired as chief officer for 12 months with a basic monthly salary of $1,400.

Records showed that on the day of his departure on March 19, 1998, Gallant downgraded Serrano’s employment contract to that of a second officer with a monthly salary of $1,000. Serrano was forced to accept the demotion on Gallant’s assurance that he would be made chief officer by the end of April 1998.

Marlow reneged on the promise and Serrano, who refused to stay on as second officer, was repatriated on May 26, 1998.

On his return home, Serrano filed a complaint for constructive dismissal against Gallant with the Labor Arbiter and demanded payment of the unexpired portion of nine months and 23 days of his contract in the total amount of $26,442.73.

The Labor Arbiter ruled in Serrano’s favor and ordered Gallant to pay Serrano $8,770, representing only three months of the unexpired portion of his contract.

On Serrano’s appeal, the National Labor Relations Commission upheld the arbiter’s findings of illegal dismissal but modified his claim to only $4,669.

In affirming the NLRC’s decision, the Court of Appeals skirted the issue raised by Serrano on the constitutionality of Section 10 of RA 8042.

In granting Serrano’s petition, the SC declared as unconstitutional the subject clause “for three months for every year of the unexpired term, whichever is less.”

The SC also modified the CA’s decision and directed Gallant and Marlow to pay Serrano his salaries for the entire unexpired portion of his employment contract consisting of nine months and 23 days computed at the rate of $1,400 per month.

The Office of the Solicitor General defended the subject clause as an exercise of the state’s police power to protect the employment of Filipino seafarers.

By limiting the liability of employers to three months, Filipino seafarers have a better chance of getting hired, the OSG added.

However, the SC said the subject clause violates due process as it deprives illegally dismissed OFWs salaries and other emoluments under their fixed-period employment contracts.

The decision was written by Associate Justice Alicia Austria-Martinez.–Edu Punay, Philippine Star