IN RE PETITION FOR EXEMPTION FROM COVERAGE BY THE SOCIAL SECURITY SYSTEM. CATHOLIC ARCHBISHOP OF MANILA, PETITIONER AND APPELLANT VS. SOCIAL SECURITY COMMISSION, RESPONDENT AND …

On September 1, 1958, the Roman Catholic Archbishop of Manila, thru
counsel, filed with the Social Security Commission a request that
“Catholic Charities, and all religious and charitable institutions
and/or organizations, which are directly or indirectly, wholly or
partially, operated by the Roman Catholic Archbishop of Manila,” be
exempted from compulsory coverage of Republic Act No. 1161, as amended,
otherwise known as the Social Security Law of 1954. The request was
based on the claim that the said Act is a labor law and does not cover
religious and charitable institutions but is limited to businesses and
activities organized for profit. Acting upon the recommendation of its
Legal Staff, the Social Security Commission in its Resolution No. 572,
series of 1958, denied the request. The Roman Catholic Archbishop of
Manila, reiterating its arguments and raising constitutional
objections, requested for reconsideration of the resolution. The
request, however, was denied by the Commission in its Resolution No.
767, series of 1958; hence, this appeal taken in pursuance of section 5
(c) of Republic Act No. 1161, as amended.

Section 9 of the
Social Security Law, as amended, provides that coverage “in the System
shall be compulsory upon all employees between the age of sixteen and
sixty years inclusive, if they have been for at least six months in the
service of an employer who is a member of the System, Provided, that
the Commission may not compel any employer to become a member of the
System unless he shall have been in operation for at least two years
and has at the time of admission, if admitted for membership during the
first year of the System’s operation at least fifty employees, and if
admitted for membership the following year of operation and thereafter,
at least six employees * * *.” The term “employer” as used in the law
is defined as “any person, natural or juridical, domestic or foreign,
who carries in the Philippines any trade, business, industry,
undertaking, or activity of any kind and uses the services of another
person who is under his orders as regards the employment, except the
Government and any of its political subdivisions, branches or
instrumentalities, including corporations owned or controlled by the
Government” (par. [c], sec. 8), while an “employee” refers to “any
person who performs services for an ’employer’ in which either or both
mental and physical efforts are used and who receives compensation for
such services” (par. [d] sec. 8). “Employment”, according to paragraph [j]
of said section 8, covers any service performed by an employer except
those expressly enumerated thereunder, like employment under the
Government, or any of its political subdivisions, branches or
instrumentalities including corporations owned and controlled by the
Government, domestic service in a private home, employment purely
casual, etc.

From the above legal provisions, it is apparent
that the coverage of the Social Security Law is predicated on the
existence of an employer-employee relationship of more or less
permanent nature and extends to employment of all kinds except those
expressly excluded.

Appellant contends that the term “employer” as defined in the law should—following the principle of ejusdem generis—be
limited to those who carry on “undertakings or activities which have
the element of profit or gain, or which are pursued for profit or
gain,” because the phrase “activity of any kind” in the definition is
preceded by the words “any trade, business, industry, undertaking.” The
contention cannot be sustained. The rule ejusdem generis
applies only where there is uncertainty. It is not controlling where
the plain purpose and intent of the Legislature would thereby be
hindered and defeated. Grosjean vs. American Paints Works [La],
160 So. 449). In the case at bar, the definition of the term “employer”
is, we think, sufficiently comprehensive as to include religious and
charitable institutions or entities not organized for profit, like
herein appellant, within its meaning. This is made more evident by the
fact that it contains an exception in which said institutions or
entities are not included. And, certainly, had the Legislature really
intended to limit the operation of the law to entities organized for
profit or gain, it would not have defined an “employer” in such a way
as to include the Government and yet make an express exception of it.

It is significant to note that when Republic Act No. 1161 was enacted,
services performed in the employ of institutions organized for
religious or charitable purposes were by express provisions of said Act
excluded from coverage thereof (sec. 8, par. [j], subpars. 7 and
8). That portion of the law, however, has been deleted by express
provision of Republic Act No. 1792, which took effect in 1957. This is
clear indication that the Legislature intended to include charitable
and religious institutions within the scope of the law.

In
support of its contention that the Social Security Law was intended to
cover only employment for profit or gain, appellant also cites the
discussions of the Senate, portions of which were quoted in its brief.
There is, however, nothing whatsoever in those discussions touching
upon the question of whether the law should be limited to organizations
for profit or gain. Of course, the said discussions dwelt at length
upon the need of a law to meet the problems of industrializing society
and upon the plight of an employer who fails to make a profit. But this
is readily explained by the fact that the majority of those to be
affected by the operation of the law are corporations and industries
which are established primarily for profit or gain.

Appellant further argues that the Social Security Law is a labor law
and, consequently, following the rule laid down in the case of Boy
Scouts of the Philippines vs. Araos (102 Phil., 1080) and other cases^[1],
applies only to industry and occupation for purposes of profit and
gain. The cases cited, however, are not in point, for the reason that
the law therein involved expressly limits its application either to
commercial, industrial or agricultural establishments or enterprises.

Upon the other hand, the Social Security Law was enacted pursuant to
the “policy of the Republic of the Philippines to develop, establish
gradually and perfect a social security system which shall be suitable
to the needs of the people throughout the Philippines and shall provide
protection to employees against the hazards of disability, sickness,
old age and death.” (Sec. 2, Republic Act No. 1161, as amended.) Such
enactment is a legitimate exercise of the police power. It affords
protection to labor, especially to working women and minors, and is in
full accord with the constitutional provisions on the “promotion of
social justice to insure the well being and economic security of all
the people.” Being in fact a social legislation, compatible with the
policy of the Church to ameliorate living conditions of the working
class, appellant cannot arbitrarily delimit the extent of its
provisions to relations between capital and labor in industry and
agriculture.

There is no merit in the claim that the
inclusion of religious organizations under the coverage of the Social
Security Law violates the constitutional prohibition against the
application of public funds for the use, benefit or support of any
priest who might be employed by appellant. The funds contributed to the
System created by the law are not public funds, but funds belonging to
the members which are merely held in trust by the Government. At any
rate, assuming that said funds are impressed with the character of
public funds, their payment as retirement, death or disability benefits
would not constitute a violation of the cited provision of the
Constitution, since such payment shall be made to the priest not
because he is a priest but because he is an employee.

Neither may it be validly argued that the enforcement of the Social
Security Law impairs appellant’s right to disseminate religious
information. All that is required of appellant is to make monthly
contributions to the System for covered employees in its employ. These
contributions, contrary to appellant’s contention, are not “in the
nature of taxes on employment.” Together with the contributions imposed
upon the employees and the Government, they are intended for the
protection of said employees against the hazards of disability,
sickness, old age and death in line with the constitutional mandate to
promote social justice to insure the well-being and economic security
of all the people.

In view of the foregoing, Resolutions
Nos. 572 and 767, series of 1958, of the Social Security Commission are
hereby affirmed. So ordered with costs against appellant.

Paras, C. J., Padilla, Bautista Angelo, Paredes, and Dizon, JJ., concur.

Concepcion, Reyes, J. B. L., and Barrera, JJ., concur in the result.

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^[1] UST Hospital Employees Association vs. UST Hospital, 95 Phil., 40; San Beda College vs. National Labor Union, 97 Phil., 787; 51 Off. Gaz., (11) 5636; Quezon Institute vs. Velasco and Quezon Institute vs. Paraso, 97 Phil., 905; 51 Off. Gaz., (12) 6175.