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Policy Brief No. 11: of Recruitment/Placement Agencies With The Principal/ Employer Under Philippine Laws
Policy Brief No. 11: of Recruitment/Placement Agencies With The Principal/ Employer Under Philippine Laws
11:
JOINT AND SEVERAL LIABILITY
OF RECRUITMENT/PLACEMENT
AGENCIES WITH THE PRINCIPAL/
EMPLOYER UNDER PHILIPPINE
Winter 2014
LAWS
INTRODUCTION
Access to justice is one of the principal challenges faced by migrant workers. In many cases, abused or illegally dismissed
workers find it difficult or even outright impossible to file and prosecute labor complaints against their foreign employers.
Once employment is terminated, the migrant worker has very limited options. Oftentimes, they are deported or opt to
return to the home country without receiving their unpaid salaries, benefits and other monetary claims. Upon arrival in their
home countries, migrant workers have no means to seek compensation from their abusive foreign employers.
Having this scenario in mind, Philippine policy makers embodied in its laws the joint and several liability of recruitment/
placement agencies and the principal/employer for money claims of overseas Filipino workers to ensure that they can still
prosecute their just claims against the foreign employer and the recruitment/placement agencies after they have returned
to Philippines.
BACKGROUND
The Government of the Republic of the Philippines whose local laws do not provide sufficient legal protection
is acknowledged internationally as one of the leading to migrant workers. Filipino domestic workers were
pioneers in the development of state-managed overseas allowed to work even in countries whose labor laws did
employment programs. not extend to domestic workers. While overseas Filipino
workers earned incomes much more than what they could
Taking advantage of the sudden wealth of oil producing have earned in the Philippines, many of them came home in
countries in West Asia in the early 70s, the Philippine body bags or broken in body, mind and spirit. Thousands
government incorporated in its 1974 Labor Code1 a of workers also fell victim to illegal recruitment activities of
comprehensive legal infrastructure for the recruitment and both licensed and unlicensed agencies.
placement of overseas contract workers and regulation of
recruitment and placement activities of private recruitment/ Innovative mechanisms to protect the welfare of overseas
placement agencies. The twin objectives of the overseas Filipino workers were also put in place by the Philippine
employment program were to address the growing Government. One of these policy initiatives is the inclusion
unemployment and underemployment problems of the in the Rules to Implement the Labor Code3 of a provision
country and to generate much-needed foreign exchange.2 on the joint and solidary liability of foreign employers
and the recruitment agencies for violations of overseas
Labor market development took precedence over welfare employment contracts.
protection. Bilateral labor agreements forged by the
Philippine government with receiving countries focused
more on labor market development and less on welfare
protection. Filipino workers were deployed to countries
Section 10. Requirement before recruitment. Joint and solidary liability in this context means
Before recruiting any worker, the private employment that both the private recruitment/placement
agency shall submit to the Bureau the following documents: agency and the foreign principal/employer can be
held individually liable for the entire amount of claim
a) A formal appointment or agency contract or obligation due to the overseas Filipino worker.
executed by a foreign-based employer in favor of the license
holder to recruit and hire personnel for the former duly
authenticated or attested by the Philippine Labor Attache
or duly authorized Philippine foreign service official, or in his
absence by an appropriate official, agency or organization National Labor Relations Commission, Philippine Overseas
in the country where the employer conducts his business. Employment Administration and Francisco D. Reyes (G. R.
In case any of the foregoing documents is executed in the No. 77279 15 April 1988).
Philippines, the same may be authenticated by the duly
authorized official of the Ministry of Foreign Affairs or of Under current rules, before a license to operate a
the employers consulate or Embassy or of the Ministry private recruitment/placement agency for overseas
of Labor and Employment official as may be appropriate. employment may be granted by the Philippine Overseas
Such formal appointment or recruitment agreement Employment Administration (POEA), the applicant
shall contain the following provisions, among others: recruitment/placement agency is required to submit
a verified undertaking stating, among others, that the
1. Terms of recruitment, including the responsibility applicant shall assume joint and solidary liability with
of the parties relative to the employment of workers; the employer for all claims and liabilities which may
arise in connection with the implementation of the
2. Power of the agency to sue and be sued jointly contract, including but not limited to payment of wages,
and solidarily with the principal or foreign based employer death and disability compensation and repatriations.4
for any of the violations of the recruitment agreement
and the contracts of employment; (emphasis supplied) In the case of corporations or partnerships, the
officers, directors, partners are required to execute
x x x x x x x x x a verified undertaking that they will be jointly
and severally liable with the company over claims
Joint and solidary liability in this context means arising from employer-employee relationship.5
that both the private recruitment/placement agency
and the foreign principal/employer can be held In addition, Section 10 of Republic Act No. 8042, otherwise
individually liable for the entire amount of claim known as The Migrant Workers and Overseas Filipinos Act of
or obligation due to the overseas Filipino worker. 1995, as amended by Republic Act No. 10022, provides that
the liability of the principal/employer and the recruitment/
As early as 1988, the validity of this provision on joint and placement agency for any and all claims arising out of an
solidary liability was upheld in two (2) cases decided by the employer-employee relationship or by virtue of any law or
Supreme Court, namely: Ambraque International Placement contract involving Filipino workers for overseas deployment
& Services v. NLRC (G.R. No. 77970, 28 January 1988) and including claims for actual, moral, exemplary and other
Manuela S. Catan/M. S. Catan Placement Agency vs. The forms of damage shall be joint and several. 6
Section 10 of the Migrant Workers and Overseas The provision on joint and several liability in the
Filipinos Act of 1995 provides that the foreign employer and Migrant Workers and Overseas Filipinos Act of 1995 assures
the local employment agency are jointly and severally liable overseas workers that their rights will not be frustrated with
for money claims including claims arising out of an employer- these complications.
employee relationship and/or damages. This section also
provides that the performance bond filed by the local agency The fundamental effect of joint and several liability
shall be answerable for such money claims or damages if they is that each of the debtors is liable for the entire obligation.
were awarded to the employee. A final determination may, therefore, be achieved even if
onlyone of the joint and several debtors are impleaded in an
This provision is in line with the states policy of action. Hence, in the case of overseas employment, either the
affording protection to labor and alleviating workers plight. local agency or the foreign employer may be sued for all claims
arising from the foreign employers labor law violations.
In overseas employment, the filing of money claims against
the foreign employer is attended by practical and legal
complications. The distance of the foreign employer alone
makes it difficult for an overseas worker to reach it and
make it liable for violations of the Labor Code. There are also
possible conflict of laws, jurisdictional issues, and procedural
rules that may be raised to frustrate an overseas workers
attempt to advance his or her claims.
SEC. 10. Money Claims. - Notwithstanding any provision of law to the contrary, the Labor Arbiters of the National Labor Relations Commission (NLRC) shall have
the original and exclusive jurisdiction to hear and decide, within ninety (90) calendar days after the filing of the complaint, the claims arising out of an employer-
employee relationship or by virtue of any law or contract involving Filipino workers for overseas deployment including claims for actual, moral, exemplary and other
forms of damage. Consistent with this mandate, the NLRC shall endeavor to update and keep abreast with the developments in the global services industry.
The liability of the principal/employer and the recruitment/placement agency for any and all claims under this section shall be joint and several. This provision
shall be incorporated in the contract for overseas employment and shall be a condition precedent for its approval. The performance bond to de filed by the
recruitment/placement agency, as provided by law, shall be answerable for all money claims or damages that may be awarded to the workers. If the recruitment/
placement agency is a juridical being, the corporate officers and directors and partners as the case may be, shall themselves be jointly and solidarily liable with the
corporation or partnership for the aforesaid claims and damages. (boldface supplied)
Such liabilities shall continue during the entire period or duration of the employment contract and shall not be affected by any substitution, amendment or
modification made locally or in a foreign country of the said contract.
Any compromise/amicable settlement or voluntary agreement on money claims inclusive of damages under this section shall be paid within thirty (30) days from
approval of the settlement by the appropriate authority.
In case of termination of overseas employment without just, valid or authorized cause as defined by law or contract, or any unauthorized deductions from the
migrant workers salary, the worker shall be entitled to the full reimbursement if his placement fee and the deductions made with interest at twelve percent (12%) per
annum, plus his salaries for the unexpired portion of his employment contract or for three (3) months for every year of the unexpired term, whichever is less. 6
In case of a final and executory judgement against a foreign employer/principal, it shall be automatically disqualified, without further proceedings, from
participating in the Philippine Overseas Employment Program and from recruiting and hiring Filipino workers until and unless it fully satisfies the judgement award.
Noncompliance with the mandatory periods for resolutions of case provided under this section shall subject the responsible officials to any or all of the following
penalties:
(a) The salary of any such official who fails to render his decision or resolution within the prescribed period shall be, or caused to be, withheld until the said official
complies therewith;
(c) Dismissal from the service with disqualification to hold any appointive public office for five (5) years.
The joint and several liability of the private recruitment/placement agency with the foreign principal/
employer may be enforced by the migrant worker by filing a complaint (arising out of an employer-
employee relationship or by virtue of any law or contract involving Filipino workers for overseas
deployment including claims for actual, moral, exemplary and other forms of damages) before the
National Labor Relations Commission.
(c) Access to effective and affordable legal (d) The foreign principal/employer is not held
assistance is limited. Under present rules, the migrant accountable for the violation of the rights of the migrant
worker is allowed to file a complaint and to prosecute worker. It is the local recruitment/placement agency that
his/her labor complaint on his/her own even without the usually pays off the judgment award in favor of the migrant
assistance of lawyer. Unfortunately, not all complainants worker. While it is true that the recruitment/placement
know how to prepare a sworn affidavit or a position paper, agency has the right and means of recourse against the
thus, the migrant worker will need the assistance of a lawyer foreign employer for reimbursement of its share in the
at some point especially if the case is elevated on appeal to solidary liability, the recruitment/placement agency usually
the higher courts. absorbs the loss without pursuing legal action against
the employer in foreign courts. At most, abusive foreign
The Public Attorneys Office has a program that provides employers can be disqualified from recruiting Filipino
free legal representation to qualified clients based on the workers in the future.
merit and/or indigency test. If the migrant-worker
RECOMMENDATIONS
Some possible solutions to overcome these problems are (c) monitor and ensure that bonds and escrow deposits
the following: posted by the private recruitment/placement agencies are
immediately replenished at all times;
(a) simplification of the legal process for
resolving workers claims; (d) require foreign employers to post a cash bond in
Philippine embassies/consulates to answer for the workers
The first paragraph of Section 10 of R. A. 8042, as claims against the employer; and
amended, requires the Labor Arbiters of the National Labor
Relations Commission to hear and decide, within ninety (e) forge bilateral agreements with the countries
(90) calendar days after the filing of the complaint, the of destination of migrant workers to provide for on-site
claims arising out of an employer-employee relationship or mechanisms for the equitable and expeditious resolution of
by virtue of any law or contract involving Filipino workers labor claims of migrant workers.
for overseas deployment including claims for actual,
moral ,exemplary and other forms of damage. Failure to In conclusion, the adoption of a policy on the joint and solidary
comply with the foregoing legal directive may be punished liability of the private recruitment/placement agency with
by withholding of salary, suspension or dismissal from the foreign principal/employer is a positive development
government service. Notwithstanding the foregoing, the towards the protection of the rights and welfare of migrant
rule is still not strictly observed on account of the heavy workers and an important step in strengthening their access
caseloads of labor arbiters. A monitoring mechanism should to justice. The Philippine experience in this regard however,
be implemented within the NLRC in order to ensure that the illustrates that the intention of this policy can be frustrated
mandatory period for resolving cases involving overseas by the existing systemic weaknesses of the judicial system.
Filipino workers is observed. The appeal process for money Nonetheless, important lessons can be drawn from the
claims should also be simplified in order to avoid delay in the Philippine experience that may be considered by other
administration of justice for the litigants. labor-sending countries in protecting their own migrant
workers.
(b) expand legal assistance of the Public Attorneys
Office (PAO) to migrant workers by expanding the scope of
assistance and increasing the number of lawyers for migrant
workers;
2. Catholic Institute for International Relations, The Labour Trade: Filipino Migrant Workers Around the World. (1987)
4. Philippine Overseas Employment Administration, POEA Rules and Regulations Governing the Recruitment and Employment of Land-based
Overseas Workers. Retrieved from http://www.poea.gov.ph/rules/POEA%20Rules.pdf
5. Republic Act No. 8042, otherwise known as The Migrant Workers and Overseas Filipinos Act of 1995. Retrieved from http://www.poea.gov.
ph/rules/ra8042.html
7. Supreme Court of the Philippines, Ambraque International Placement & Services v. NLRC, (G.R. No. 77970, 28 January 1988). Retrieved
from http://www.lawphil.net/judjuris/juri1988/jan1988/gr_77970_1988.html
8. Supreme Court of the Philippines, Manuela S. Catan/M. S. Catan Placement Agency vs. The National Labor Relations Commission, Philippine
Overseas Employment Administration and Francisco D. Reyes (G. R. No. 77279 15 April 1988). Retrieved from http://www.lawphil.net/judjuris/
juri1988/apr1988/gr_77279_1988.html
9. Supreme Court of the Philippines, Sameer Overseas Placement Agency, Inc. vs.
Joy C. Cabiles, (G. R. No. 170139, 05 August 2014). Retrieved from http://sc.judiciary.gov.ph/pdf/web/viewer.html?file=/jurisprudence/2014/
august2014/170139.pdf
10. Supreme Court of the Philippines, ATCI Overseas Corporation, et al. vs. Ma. Josefa Echin, (G.R. No. 178551, 10 October 2010). Retrieved
from http://www.lawphil.net/judjuris/juri2010/oct2010/gr_178551_2010.html
11. Philippine Overseas Employment Administration, POEA Memorandum Circular No. 14, series of 1996. Retrieved from http://www.poea.gov.
ph/MCs/mc1996.htm
12. Philippine Overseas Employment Administration, POEA Memorandum Circular No. 13, series of 2012. Retrieved from http://www.poea.gov.
ph/MCs/mc2012.htm
If you are interested in joining the Open Working Group on Labour Migration & Recruitment, please email us at mfa@
mfasia.org to express your interest. Please check recruitmentreform.org/contribute-to-the-open-working-group/ to see how
members can contribute to the working group!
Step It Up: Dignity, Rights, Development is the global campaign launched by the
Migrant Forum in Asia network and affiliated civil society organizations, trade unions, the
Committee on the Protection of the Rights of All Migrant Workers and Members of their
Families, and the International Labour Organization, which highlights the significance
of the International Convention on the Protection of the Rights of All Migrant Workers
and Members of their Families (CMW / UN Migrant Workers Convention). 18 December
2015 marks the 25th anniversary of the adoption of the Convention that specifically
guarantees the rights of all migrant workers and members of their families.
The 25th anniversary of the UN Migrant Workers Convention is the perfect occasion
for the migrants rights movement to magnify the unwavering advocacy for further
ratification and implementation of this international human rights instrument, which
looks after the human rights and labor rights of migrant workers and extends protection
to members of their families.
Launched on 18 December 2014, the Step It Up campaign encourages all stakeholders States parties, trade unions, employers
organizations, civil society organizations, migrant workers and members of their families to take part in this year long global
initiative, beginning on 18 December 2014 to 18 December 2015. Activities relating to the promotion of the human rights of
migrant workers and members of their families as well as engagements with States to ratify the CMW will find space here, in
the online platform of the Step It Up campaign.
The online platform of the Step It Up campaign centers on the following themes: promotion of the ratification of the UN
Migrant Workers Convention, children of migrant workers, particularly ending immigration detention of children, migrant
domestic workers, contributions of migrant workers in the countries of origin and destination, and situations of forced labor,
human tracking and slavery-like practices that migrant workers experience. The campaign also links up with other ratification
efforts, including the ILO Convention on Domestic Work No. 189 (C189), ILO Convention No. 97 (Migration for Employment
Convention), ILO Convention No. 143 (Migrant Workers Convention) and the ILO Forced Labour Protocol. These themes and
the ratification of international human rights and labor rights treaties directly impact the lives and the realization of the
rights of all migrant workers and members of their families. The Step It Up campaign through the online platform strives
to weave together these interrelated issues and underscores that migration is not an isolated matter but is tied to various
dimensions of peoples struggles for equality, dignity, decent work and human rights.