113) Conference of Maritime Manning Agencies vs. POEA
113) Conference of Maritime Manning Agencies vs. POEA
113) Conference of Maritime Manning Agencies vs. POEA
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* FIRST DIVISION.
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VOL.243,APRIL21,1995 667
The Conference of Maritime Manning Agencies, Inc. vs. Philippine
Overseas Employment Administration
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community affected by it. It does not prevent a proper exercise by the State
of its police power by enacting regulations reasonably necessary to secure
the health, safety, morals, comfort, or general welfare of the community,
even though contracts may thereby be affected, for such matters cannot be
placed by contract beyond the power of the State to regulate and control
them.
Same; Same; Same; The freedom to contract is not absolute.—Verily,
the freedom to contract is not absolute; all contracts and all rights are
subject to the police power of the State and not only may regulations which
affect them be established by the State, but all such regulations must be
subject to change from time to time, as the general well-being of the
community may require, or as the circumstances may change, or as
experience may demonstrate the necessity. And under the Civil Code,
contracts of labor are explicitly subject to the police power of the State
because they are not ordinary contracts but are impressed with public
interest.
DAVIDE, JR.,J.:
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VOL.243,APRIL21,1995 669
The Conference of Maritime Manning Agencies, Inc. vs. Philippine
Overseas Employment Administration
(1) The POEA does not have the power and authority to fix and
promulgate rates affecting death and workmen’s
compensation of Filipino seamen working in ocean-going
vessels; only Congress can.
(2) Even granting that the POEA has that power, it,
nevertheless, violated the standards for its exercise.
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other benefits as specified under Part II, Section C, paragraph 1 and Section
L, paragraphs 1 and 2 of the POEA Standard Employment Contract for
Seafarers which shall henceforth read as follows:
1. In case of death of the seaman during the term of his Contract, the
employer shall pay his beneficiaries the Philippine Currency
equivalent to the amount of US$50,000 and an additional amount
of US$7,000 to each child under the age of twenty-one (21) but not
exceeding four children at the exchange rate prevailing during the
time of payment.
Where the death is caused by warlike activity while sailing within a
declared warzone or war risk area, the compensation payable shall
be doubled. The employer shall undertake appropriate warzone
insurance coverage for this purpose.”
xxx
III. The maximum rate provided under Appendix I-A shall likewise be
adjusted to US$50,000 regardless of rank and position of the
seafarer.
IV. Upon effectivity, the new compensation and other benefits herein
provided shall apply to any Filipino seafarer on board any vessel,
provided, that the cause of action occurs after this Resolution takes
effect.
V. This Resolution shall take effect after sixty (60) days from
publication in a newspaper of general circulation.
2
Memorandum Circular No. 05, issued on 19 January 1994 by
POEA Administrator Felicisimo Joson and addressed to all Filipino
seafarers, manning agencies, shipowners, managers and
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IV. Upon effectivity, the new compensation and other benefits ... shall apply
to any Filipino seafarer already on-board any vessel, provided, that the
cause of action occurs after the said compensation and benefits take effect.
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The Conference of Maritime Manning Agencies, Inc. vs. Philippine
Overseas Employment Administration
4
in Eastern Shipping Lines, Inc. vs. POEA; (b) the “non-
appointment” of the third member of the Governing Board does not
necessarily invalidate the acts of the Board, for it has been
functioning “under the advisement of the Tripartite Technical
Working Group which group is incidentally constituted by the
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673
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The Conference of Maritime Manning Agencies, Inc. vs. Philippine
Overseas Employment Administration
administrative agencies the authority to issue rules to carry out the general
provisions of the statute. This is called the “power of subordinate
legislation.”
...
With this power, administrative bodies may implement the broad policies
laid down in a statute by “filling in” the details which the Congress may not
have the opportunity or competence to provide. This is effected by their
promulgation of what are known as supplementary regulations, such as the
implementing rules issued by the Department of Labor on the new Labor
Code. These regulations have the force and effect of law.
...
Memorandum Circular No. 2 is one such administrative regulation. The
model contract prescribed thereby has been applied in a significant number
of the cases without challenge by the employer. The power of the POEA
(and before it the National Seamen Board) in requiring the model contract is
not unlimited as there is a sufficient standard guiding the delegate in the
exercise of the said authority. That standard is discoverable in the executive
order itself which, in creating the Philippine Overseas Employment
Administration, mandated it to protect the rights 8 of overseas Filipino
workers to “fair and equitable employment practices.”
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In the case of People vs. Rosenthal and Osmeña, G.R. Nos. 46076 and
46077, promulgated June 12, 1939, and in Pangasinan Transportation vs.
The Public Service Commission, G.R. No. 47065, promulgated June 26,
1940, this Court had occasion to observe that the principle of
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9 People vs. Exconde, 101 Phil. 1125, 1129-1130 [1957], citing Calalang vs. Williams, 70
Phil. 726 [1940]; Pangasinan Transportation vs. Public Service Commission, 70 Phil. 22
[1940]; People vs. Rosenthal, 68 Phil. 328 [1939]; People vs. Vera, 65 Phil. 56 [1937]; and
Rubi vs. Provincial Board of Mindoro, 39 Phil. 660 [1919].
10 Supra, note 9.
11 Supra, note 9.
12 Supra, note 9, at 732.
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13 In the past, this Court has held the following, inter alia, as sufficient standards
for purposes of subordinate legislation: public welfare in Municipality of Cardona vs.
Binangonan, 36 Phil. 547 [1917]; necessary in the interest of law and order in Rubi
vs. Provincial Board, supra, note 9; public interest in People vs. Rosenthal, supra,
note 9; justice and equity in Antamok GoldFields Mining Co. vs. CIR, 70 Phil. 340
[1940]; public convenience and welfare in Calalang vs. Williams, supra note 9; justice
and equity and substantial merits of the case in International Hardwood and Veneer
Co. vs. Pangil Federation of Workers, 70 Phil. 602 [1940]; simplicity, economy and
efficiency in Cervantes vs. Auditor General, 91 Phil. 359 [1952]; and national interest
in Free Telephone Workers Union vs. Minister of Labor and Employment, 108 SCRA
757 [1981].
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Overseas Employment Administration
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ART.1700. The relations between capital and labor are not merely
contractual. They are so impressed with public interest that labor contracts
must yield to the common good. Therefore, such contracts are subject to the
special laws on labor unions, collective bargaining, strikes and lockouts,
closed shop, wages, working conditions, hours of labor and similar subjects.
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Coca-Cola Salesforce Union vs. NLRC
Petition dismissed.
——o0o——
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