ATCI OVERSEAS CORPORATION, AMALIA G. IKDAL AND MINISTRY OF PUBLIC HEALTH-KUWAIT PETITIONERS, VS. MA. JOSEFA ECHIN, RESPONDENT.

ATCI Overseas versus Echin

The Case

This is a petition for review on certiorari brought by ATCI Overseas Corporation, its officer Amalia Ikdal, and the Ministry of Public Health of Kuwait against Ma. Josefa Echin, an overseas Filipino worker deployed to Kuwait as a medical technologist. Echin was terminated before her one-year probationary period ended, and she sued for illegal dismissal. The case matters because it settles two questions every recruiter and every overseas worker must know: can a local recruitment agency hide behind the sovereign immunity of its foreign principal, and who bears the burden of proving the foreign law that supposedly governs the employment? The Supreme Court answered both against the agency.

Procedural History

Echin filed a complaint for illegal dismissal with the National Labor Relations Commission against ATCI, Amalia Ikdal, and the Ministry. The Labor Arbiter ruled that she was illegally dismissed and ordered the petitioners to pay her the salary corresponding to the three months of her contract that remained unexpired. ATCI and Ikdal appealed, and the National Labor Relations Commission affirmed the Labor Arbiter. Their motion for reconsideration was denied, so they elevated the matter to the Court of Appeals. The Court of Appeals affirmed the Commission, holding that a private employment agency assumes all responsibilities for the implementation of the overseas worker's contract and may be sued jointly and solidarily with the foreign principal, and that under Section 10 of Republic Act Number 8042 corporate officers may themselves be held jointly and solidarily liable. After the Court of Appeals denied their motion for reconsideration, the petitioners came to the Supreme Court by petition for review on certiorari.

Facts

ATCI Overseas Corporation, acting for its foreign principal the Ministry of Public Health of Kuwait, hired Ma. Josefa Echin as a medical technologist under a two-year contract denominated as a Memorandum of Agreement, with a monthly salary of 1,200 dollars. The agreement provided that all newly hired employees undergo a probationary period of one year and are covered by Kuwait's Civil Service Board Employment Contract Number 2.

Echin was deployed on February 17, 2000. On February 11, 2001, before the probationary year had run its course, she was terminated on the ground that she had allegedly not passed the probationary period. The Ministry denied her request for reconsideration, and she returned to the Philippines on March 17, 2001, paying her own air fare.

On July 27, 2001, she filed her complaint for illegal dismissal. Before the Supreme Court, the petitioners argued that the contract expressly made Kuwaiti civil service law govern, that the Philippine rules on probationary employment therefore did not apply, and that because the Ministry is a foreign government agency immune from suit, no liability could attach to ATCI either.

Issues

• Whether or not the local recruitment agency may escape joint and solidary liability with its foreign principal by invoking the foreign principal's immunity from suit, or by insisting that the foreign principal's liability must first be judicially established.
• Whether or not Philippine labor law on probationary employment applies, given the contractual stipulation that Kuwaiti civil service laws govern the employment.
• Whether or not Amalia Ikdal, as a corporate officer of the recruitment agency, may be held jointly and solidarily liable with the agency for the money claims awarded to the overseas worker.

Applicable Provisions

Section 10 of Republic Act Number 8042, the Migrant Workers and Overseas Filipinos Act of 1995, provides:

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 damages. 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 be 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.

This is the provision that fastens joint and solidary liability on the agency and, where the agency is a corporation, on its responsible officers.

Section 24 of Rule 132 of the Revised Rules of Court, on proof of official records, provides:

SEC. 24. Proof of official record. -- The record of public documents referred to in paragraph (a) of Section 19, when admissible for any purpose, may be evidenced by an official publication thereof or by a copy attested by the officer having the legal custody of the record, or by his deputy, and accompanied, if the record is not kept in the Philippines, with a certificate that such officer has the custody. If the office in which the record is kept is in a foreign country, the certificate may be made by a secretary of the embassy or legation, consul general, consul, vice consul, or consular agent or by any officer in the foreign service of the Philippines stationed in the foreign country in which the record is kept, and authenticated by the seal of his office.

This governs how a party proves a foreign law, and the petitioners failed to comply with it.

Section 25 of Rule 132, on what an attestation of a copy must state, provides:

SEC. 25. What attestation of copy must state. -- Whenever a copy of a document or record is attested for the purpose of the evidence, the attestation must state, in substance, that the copy is a correct copy of the original, or a specific part thereof, as the case may be. The attestation must be under the official seal of the attesting officer, if there be any, or if he be the clerk of a court having a seal, under the seal of such court.

This completes the proof requirement that the petitioners did not satisfy.

Ruling

On the first issue, the Court held that ATCI, as a private recruitment agency, cannot evade responsibility for the money claims of overseas Filipino workers by the mere expediency of claiming that its foreign principal is a government agency clothed with immunity from suit, or that the foreign principal's liability must first be established before the agency can be held liable. Republic Act Number 8042 precisely affords the worker a recourse and assures immediate and sufficient payment. The Court quoted its earlier ruling in Skippers United Pacific versus Maguad:

[T]he obligations covenanted in the recruitment agreement entered into by and between the local agent and its foreign principal are not coterminous with the term of such agreement so that if either or both of the parties decide to end the agreement, the responsibilities of such parties towards the contracted employees under the agreement do not at all end, but the same extends up to and until the expiration of the employment contracts of the employees recruited and employed pursuant to the said recruitment agreement. Otherwise, this will render nugatory the very purpose for which the law governing the employment of workers for foreign jobs abroad was enacted.

To allow the agency to invoke immunity, or to wait for the judicial determination of the foreign principal's liability, would render the law on joint and solidary liability inutile.

On the second issue, the Court accepted that a contract freely entered into is the law between the parties, who may choose the law to govern their obligations, provided it is not contrary to law, morals, good customs, public order, or public policy. But the party invoking a foreign law bears the burden of proving it, under the doctrine of processual presumption: where a foreign law is not pleaded, or is pleaded but not proved, the presumption is that the foreign law is the same as ours, and Philippine labor law applies. The Philippines does not take judicial notice of foreign laws. What the petitioners submitted were mere certifications of the correctness of translations, which expressly assumed no responsibility for the contents, and which did not prove that Kuwaiti civil service law differs from Philippine law or that the dismissal was valid under it. The Court therefore applied Philippine labor law and sustained the finding of illegal dismissal.

On the third issue, the Court held that Ikdal's joint and solidary liability as a corporate officer is in order, following the express provision of Section 10 of Republic Act Number 8042 that corporate officers and directors shall themselves be jointly and solidarily liable with the corporation for the claims and damages awarded.

Doctrine

A private recruitment agency is jointly and solidarily liable with its foreign principal for the money claims of the overseas worker it deploys, and it cannot escape that liability by invoking the foreign principal's immunity from suit or by demanding that the principal's liability first be judicially established. Where the agency is a corporation, its corporate officers and directors are themselves jointly and solidarily liable under Section 10 of Republic Act Number 8042. A party who invokes a foreign law to govern the employment bears the burden of proving that law as a question of fact, by an authenticated copy complying with Sections 24 and 25 of Rule 132; failing that proof, the processual presumption applies and the foreign law is presumed identical to Philippine law.

Disposition

The Supreme Court denied the petition and affirmed the rulings holding the petitioners jointly and solidarily liable to Echin for the three months of unexpired salary under her contract.

Remember This

The one line to memorize: the local recruiter cannot hide behind the foreign principal's sovereign immunity, and whoever invokes a foreign law must prove it or Philippine law applies. Examiners use this case on joint and solidary liability of recruitment agencies and corporate officers under Section 10 of Republic Act Number 8042, and on the processual presumption requiring proof of foreign law under Rule 132.