Social Legislation 2014 Final Exam CasesAtty. Pilariza Baldovino, Ph. D.PHILHEALTH CASES

1. EDEN LLAMAS vs. OCEAN GATEWAY MARITIME & MANAGEMENT, INC., GR No. 179293

Facts:Ocean Gateway hired Llamas on August 1, 2001 as an accounting manager.

Macaraig, Oceans Chief Executive Officer called Llamas attention for her failure, for four times, to accomplish long overdue monthly and annual company financial reports and to remit companys contributions to the SSS and PhilHealth.

On account of the delay in the remittance of those contributions, Ocean Gateway was penalized in the amount of P18,580.41 which it charged to Llamas via salary deductions.

Macaraig charged him with gross and habitual neglect of duty and/or misconduct or willful disobedience and insubordination, requiring him to submit written explanantion why he should not be dismissed from employment.

Llamas claimed that the delay was due to the fact that she was overloaded with work and undermanned.

Finding this explanantion unsatisfactory, she was terminated from employment on Juy 31, 2002.

Issue:WON Llamas can be held liable for the delay in the remittances to SSS/PhilHeath

Ruling:Under Article 282 (b) of theLabor Code,negligence must be bothgross and habitual to justify the dismissal of an employee.Gross negligence is characterized by want of even slight care, acting or omitting to act in a situation where there is a duty to act, not inadvertently but willfully and intentionally with a conscious indifference to consequences insofar as other persons may be affected.In the present case,petitioner, as respondents Accounting Manager, failed to discharge her important duty ofremitting SSS/PhilHealth contributions not once but quadruple times, resulting in respondents incurring of penalties totalingP18,580.41, not to mention the employees/members contributions being unupdated.Her claim of being overworked and undermanned does not persuade.As noted by respondent, the company had been in operationfor less than three (3) months at the time the negligence and delays were committed, with only a few transactions and only with one principal, Malaysian Merchant Marine Bhd., hence, its financial and accounting books should not have been difficult to prepare.Moreover, as claimed by respondent which wasnot refutedby petitioner, shefailed to remit the contributions as early as November 2001 during which time, however, on-the-job trainees were still with the company, hence, her claim of being undermanned behind such failure does not lie.

For her act of understating the companys profits or financial position was willful and not a mere error of judgment, committed as it was in order to save costs, which to her warped mind, was supposed to benefit respondent.It was not merely a violation of company policy, but of the law itself, and put respondent at risk of being made legally liable.Verily, it warrants her dismissal from employment as respondents Accounting Manager, for as correctly ruled by the appellate court, an employer cannot be compelled to retain in its employ someone whose services is inimical to its interests.

2. PHILIPPINE HEALTH INSURANCE CORPORATION vs.CHINESE GENERAL HOSPITAL AND MEDICAL CENTER, GR No. 163123

FACTS:On February 14, 1995, Republic Act No. 7875, otherwise known as An Act Instituting a National Health Insurance Program for all Filipinos and Establishing the Philippine Health Insurance Corporation For the Purpose, was approved and signed into law.

Prior to its enactment, CGHhad been an accredited health care provider under the Philippine Medical Care Commission (PMCC), more popularly known as Medicare.

As such, petitionerfiled its Medicare claims with the SSS from 1989 to 1992, amounting to P8,102,782.10. Its application for the payment of its claim was overtaken by the passage of R.A. 7875.

Instead of giving due course to petitioners claims, only P1,365,556.32 was paid to petitioner, representing its claims from 1989 to 1992.

Petitioner again filed its claims representing services rendered to its patients from 1998 to 1999, amounting to P7,554,342.93. For being allegedly filed beyond the sixty (60) day period allowed by the implementing rules and regulations, Section 52 thereof, petitioners claims were denied by the Claims Review Unit of Philhealth.

Petitioners claim was denied with finality by PHILHEALTH.

ISSUE:WON CGH is entitled to the amount it is claiming from PhilHealth

RULING:Under the rules promulgated by the Philhealth Board pursuant to RA 7875, any claim for payment of services rendered (to a patient) shall be filed within sixty (60) calendar days from the date of discharge of the patient. Otherwise, the claim is barred.

Under these circumstances, it is unreasonable to expect respondent CGH to comply 100% of the time with the prescribed 60-day rule of Philhealth. Despite the prescribed standard procedures, respondent has no assurance of the members prompt submission of the required documents. This factor is completely beyond its control. There will always be delay not attributable to respondent.

The unreasonably strict implementation of the 60-day rule, without regard to the causes of delay beyond respondents control, will be counter-productive to the long-term effectiveness of the NHIP. Instead of placing a premium on participation in the Program, Philhealth punishes an accredited health provider like CGH by refusing to pay its claims for services already rendered. Under these circumstances, no accredited provider will gamble on honoring claims with delayed supporting papers no matter how meritorious knowing that reimbursement from Philhealth will not be forthcoming.

This Court will not hesitate, whenever necessary, to allow a liberal implementation of the rules and regulations of an administrative agency in cases where their unjustifiably rigid enforcement will result in a deprivation of legal rights. In this case, respondent had already rendered the services for which it was filing its claims. Technicalities should not be allowed to defeat respondents right to be reimbursed, specially since petitioners charter itself guarantees such reimbursement.

A careful reading of RA 7875 shows thatthe law itself does not provide for any specific period within which to file claims. We can safely presume therefore that the period for filing was notper sethe principal concern of the legislature. More important than mere technicalities is the realization of the state policy to provide Philhealth members with the requisite medical care at the least possible cost. Truly, nothing can be more disheartening than to see the Acts noble objective frustrated by the overly stringent application of technical rules.

3. PHILIPPINE JOURNALISTS, INC. vs.JOURNAL EMPLOYEES UNION (JEU), FOR ITS UNION MEMBER, MICHAEL ALFANTE, G.R. No. 192601

FACTS:Petitioner maintained: that under Section 4, Article XIII of the CBA, funeral and bereavement aid should be granted upon the death of a legal dependent of a regular employee;

that consistent with the definition provided by the Social Security System (SSS), the term legal dependent referred to the spouse and children of a married regular employee, and to the parents and siblings, 18 years old and below, of a single regular employee;

that the CBA considered the term dependents to have the same meaning as beneficiaries, as provided in Section 5, Article XIII of the CBA on the payment of death benefits;

that its earlier granting of claims for funeral and bereavement aid without regard to the foregoing definition of the legal dependents of married or single regular employees did not ripen into a company policy whose unilateral withdrawal would constitute a violation of Article 100 of the Labor Code,the law disallowing the non-diminution of benefits;

that it had approved only four claims from 1999 to 2003 based on its mistaken interpretation of the term legal dependents, but later corrected the same in 2000;

that the grant of funeral and bereavement aid for the death of an employees legal dependent, regardless of the employees civil status, did not occur over a long period of time, was not consistent and deliberate, and was partly due to its mistake in appreciating a doubtful question of law; and

that its denial of subsequent claims did not amount to a violation of the law against the non-diminution of benefits.

ISSUE:What is the coverage of the term legal dependent as used in a stipulation in a collective bargaining agreement (CBA)?

WON the civil status of the employee as either married or single is the controlling consideration in order that a person may qualify as the employees legal dependent

RULING:A collective bargaining agreement (or CBA) refers to the negotiated contract between a legitimate labor organization and the employer concerning wages, hours of work and all other terms and conditions of employment in a bargaining unit. As in all contracts, the parties in a CBA may establish such stipulations, clauses, terms and conditions as they may deem convenient provided these are not contrary to law, morals, good customs, public order or public policy. Thus, where the CBA is clear and unambiguous, it becomes the law between the parties and compliance therewith is mandated by the express policy of the law.

The coverage of the term legal dependent as used in a stipulation in a collective bargaining agreement (CBA) granting funeral or bereavement benefit to a regular employee for the death of a legal dependent, if the CBA is silent about it, is to be construed as similar to the meaning that contemporaneous social legislations have set. This is because the terms of such social legislations are deemed incorporated in or adopted by the CBA.

Considering that existing laws always form part of any contract, and are deemed incorporated in each and every contract,the definition of legal dependents under the social legislations applies in the absence of a contrary or different definition mutually intended and adopted by the parties in the CBA. Accordingly, the concurrence of a legitimate spouse does not disqualify a child or a parent of the employee from being a legal dependent provided substantial evidence is adduced to prove the actual dependency of the child or parent on the support of the employee.

In this regard, the differentiation among the legal dependents is significant only in the event the CBA has prescribed a hierarchy among them for the granting of a benefit; hence, the use of the terms primary beneficiaries and secondary beneficiaries for that purpose. But considering that Section 4, Article XIII of the CBA has not included that differentiation, petitioner had no basis to deny the claim for funeral and bereavement aid of Alfante for the death of his parent whose death and fact of legal dependency on him could be substantially proved.

4. ALPHA C. JACULBE vs. SILLIMAN UNIVERSITY, G.R. No. 156934

FACTS:Sometime in 1958, petitioner began working for respondents university medical center as a nurse.

In a letter dated December 3, 1992,respondent, through its HRD Office, informed petitioner that she was approaching her 35th year of service with the university and was due for automatic retirement on November 18, 1993, at which time she would be 57 years old. This was pursuant to respondents retirement plan for its employees which provided that its members could be automatically retired "upon reaching the age of 65 or after 35 years of uninterrupted service to the university."

Petitioner emphatically insisted that the compulsory retirement under the plan was tantamount to a dismissal and pleaded with respondent to be allowed to work until the age of 60 because this was the minimum age at which she could qualify for SSSpension. But respondent stood pat on its decision to retire her, citing "company policy."

On November 15, 1993, petitioner filed a complaint in the NLRC for "termination of service with preliminary injunction and/or restraining order."

On November 18, 1993, respondent compulsorily retired petitioner.

ISSUE:Did respondents retirement plan imposing automatic retirement after 35 years of service contravene the security of tenure clause in the 1987 Constitution and the Labor Code?

Did respondent commit illegal dismissal by retiring petitioner solely by reason of such provision in its retirement plan?

RULING:Retirement plans allowing employers to retire employees who are less than the compulsory retirement age of 65 are notper serepugnant to the constitutional guaranty of security of tenure. Article 287 of the Labor Code provides:

ART. 287. Retirement - Any employee may be retired upon reaching the retirement age established in the collective bargaining agreement or other applicable employment contract. Xxx

By its express language, the Labor Code permits employers and employees to fix the applicable retirement age at below 60 years.

However, after reviewing the rules and regulations of respondents retirement plan, SC find that the plan runs afoul of the constitutional guaranty of security of tenure contained in Article XIII, also known as the provision on Social Justice and Human Rights.

A perusal of the rules and regulations of the plan shows that participation therein was not voluntary at all.

According to the CAs decision, respondents retirement plan "had been in effect for more than 30 years." What was not pointed out, however, was that the retirement plan came into being in 1970or 12 years after petitioner started working for respondent. In short, it was not part of the terms of employment to which petitioner agreed when she started working for respondent. Neither did it become part of those terms shortly thereafter, as the CA would have us believe.

Retirement is the result of a bilateral act of the parties, a voluntary agreement between the employer and the employee whereby the latter, after reaching a certain age agrees to sever his or her employment with the former.

At this point, reinstatement is out of the question. Petitioner is now 71 years old and therefore well over the statutory compulsory retirement age. For this reason, we grant her separation pay in lieu of reinstatement. It is also for this reason that we modify the award of backwages in her favor, to be computed from the time of her illegal dismissal on November 18, 1993 up to her compulsory retirement age.

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