Isalyn Echavez vs. Bonto-Perez

G.R. No. 109808 1 March 1995

Chavez is a dancer who was contracted by Centrum Placement & Promotions Corporation to

perform in Japan for 6 months. The contract was for $1.5k a month, which was approved by

POEA. After the approval of said contract, Chavez entered into a side contract reducing her salary

with her Japanese employer through her local manager-agency (Jaz Talents Promotion). The

salary was reduced to $500 and $750 was to go to Jaz Talents. In February 1991 (two years after

the expiration of her contract), Chavez sued Centrum Placement and Jaz Talents for

underpayment of wages before the POEA.

The POEA ruled against her. POEA stated that the side agreement entered into by Chavez with

her Japanese employer superseded the Standard Employment Contract; that POEA had no

knowledge of such side agreement being entered into; that Chavez is barred by laches for

sleeping on her right for two years.

ISSUE: Whether or not Chavez is entitled to relief.

HELD: Yes. The SC ruled that the managerial commission agreement executed by Chavez to

authorize her Japanese Employer to deduct her salary is void because it is against our existing

laws, morals and public policy. It cannot supersede the standard employment contract approved

by the POEA with the following stipulation appended thereto:

It is understood that the terms and conditions stated in this Employment Contract are in

conformance with the Standard Employment Contract for Entertainers prescribed by the POEA

under Memorandum Circular No. 2, Series of 1986. Any alterations or changes made in any part

of this contract without prior approval by the POEA shall be null and void;

The side agreement which reduced Chavez’s basic wage is null and void for violating the POEA’s

minimum employment standards, and for not having been approved by the POEA. Here, both

Centrum Placement and Jaz Talents are solidarily liable.

Laches does not apply in the case at bar. In this case, Chavez filed her claim well within the three-

year prescriptive period for the filing of money claims set forth in Article 291 of the Labor

Code. For this reason, laches is not applicable.