GREAT PACIFIC LIFE ASSURANCE CORPORATION, PETITIONER, VS. NATIONAL LABOR RELATIONS COMMISSION AND VICTOR T. SAREN, RESPONDENTS.

Great Pacific Life Assurance Corporation (GREPALIFE) questions
the finding of the public respondent that Victor T. Saren was its regular
employee who was unjustly dismissed and who should be reinstated with backwages
and other benefits.

The facts of the case are stated in the Comments filed by the
Solicitor General.^[1]
They are:

“Sometime in June 1976, private respondent Victor T. Saren
filed his application for a Certificate of Authority as an Insurance Agent of
petitioner GREPALIFE. It is a condition
precedent, however, that private
respondent first pass the examination given by the Insurance Commission before
he could be issued a Certificate of Authority (Section 290, Insurance Code of
the Phil.).

“In order to prepare private respondent for the examination to
be given by the Insurance Commission, private respondent was taken in as a
TRAINEE effective July 26, 1976, as per letter of GREPALIFE dated August 9,
1976. The letter reads:

‘TO    :           Victor
T. Saren                                                                                    GP-HSO-A-76-1556

Campagao, Bilar        

B o h o l

‘SUBJECT:   YOUR APPLICATION FOR CA                                                          Date:
9 August 1976

‘This is to acknowledge your applica­tion
for Certificate of Authority. We shall
process the same in the course of your training and inform you of the schedule
for examination.

‘Effective 26 July 1976 you are
hereby considered as a TRAINEE for Home Ser­vice Agent assigned in the
territory specified below with Zone Training Supervisor: Mr. Susano Penaflor, who shall give
you extensive training in preparation to your taking and passing the IC
examination.

TERRITORY:    62-02-04

‘You shall be reporting directly to your
Zone Training Supervisor under whose supervision the above territory falls and
be responsible to him for any assignment and task in the course of your training.

‘You shall receive a training subsidy from
your Zone Training Supervisor. You
shall not be entitled to any bonus and collection commission until you are
issued a CA.

‘Congratulations and we
wish you success.

Sgd.
REUBEN M. ABENOJAR

Production Manager

Home Service Operations’

“Apparently, GREPALIFE was dissatisfied with private
respondent’s performance forcing the former to sever its relations with the
latter on February 12, 1977. (There is
also no showing whether private respondent took the examination given by the
Insurance Commission and whether or not he passed the same.)

“On June 15, 1977, private respondent filed a complaint for
‘Unjust Dismissal with claims for Labor Standard Benefits provided by the Labor
Code of the Philippines’, alleging among others that he (private respondent)
was an employee of GREPALIFE.

“On May 31, 1978, Regional Director Francisco P. Armado issued
an Order finding Victor T. Saren as an employee of petitioner who was unjustly
dismissed without prior clearance. The
Regional Director also ordered the reinstatement of Victor T. Saren with ‘full
backwages from March 1977 up to the actual date of reinstatement to be computed
in accordance with their agreement but not to contravene the provisions of the
minimum wage law and other decrees applicable thereto and without loss of
seniority rights.’

“Dissatisfied with the above Order, petitioner appealed and on
August 11, 1981, Deputy Minister Vicente Leogardo, Jr. issued an Order finding
Victor T. Saren as a Trainee thus setting aside the Order of Regional Director
Francisco P. Armado.

“The case then was ‘indorsed to the Arbitration Branch of
Regional Office No. 7 for compulsory arbitration on the money claims of
complainant.’

“At this point, we wish to stress that private respondent
Victor T. Saren did not appeal the Order of Deputy Minister Vicente Leogardo,
Jr.

“On November 8, 1982, Labor Arbiter Potenciano Cenizares, Jr.,
although cognizant of the limits of his jurisdiction, i.e. money claims, went
further to state that Victor T. Saren was a regular employee and as such should
be entitled to full salary, not just P40.00 per week training subsidy, and the
other benefits under labor standard laws.

“Petitioner appealed to respondent NLRC, but in a resolution
promulgated on November 20, 1985, the latter dismissed the former’s appeal and
affirmed the Order of November 8, 1982, rendered by Labor Arbiter Potenciano
Cenizares, Jr.

“Petitioner
moved to reconsider the resolution but to no avail.”

(Rollo, pp-94-96)

The Solicitor-General,   who
appeared for the National Labor Relations Commission (NLRC), agrees with the
petitioner that the respondent NLRC committed reversible error when it
dismissed the petitioner’s appeal and affirmed the decision of Labor Arbiter Potenciano Cenizares, Jr.

A review of the records of this petition shows that it is
meritorious.

Mr. Saren applied for a certificate of authority as an insurance
agent of GREPALIFE.

The letter accepting him as Trainee shows that he was not hired
as a regular employee. He was taken in
as a trainee to be given extensive training prepa­ratory to his taking the
examinations given by the Insurance Commission.

Section 299 of the Insurance Code provides:

“Sec. 299. No
insurance company doing business in the Philippines, nor any agent, thereof, shall pay any commission or other
compensation to any other person for ser­vices in obtaining insurance, unless
such person shall have first procured from the Commissioner a license to act as
an insurance agent of such company or as an insurance broker as hereinafter
provided.

“No person shall act
as an insurance agent or as an insurance broker in the solicitation or
procurement of applications for insurance, or receive for services in obtaining
insurance, any commission or other compensation from any insurance company
doing business in the Philippines, or any agent thereof, without first
procuring a license so to act from the Commissioner, which must be renewed
annually on the first day of January, or within six months thereafter. Such license shall be issued by the
Commissioner only upon the written application of the person desiring it, such
application if for a license to act as insurance agent, being approved and
countersigned by the company such person desires to represent, and shall be
upon a form prescribed by the Commis­sioner giving such information as he may
require and upon payment of the corresponding fee hereinafter prescribed. The Commissioner shall satisfy himself as to
the competence and trustworthiness of
the applicant and shall have
the right to refuse to issue or renew and to suspend or revoke any such
license in his discretion. No such
license shall be valid after the
thirtieth day of June of the year following its issuance unless it is
renewed.” (As amended by Presidential Decree No. 1455).

It is obvious from the above provision that before Mr. Saren can
be hired as an insurance agent, he must first qualify and get the necessary
license. No regular employee-employer
relationship could exist between the petitioner and the private respondent
until the legal requirements were first met. The petitioner would have been violating
the law if it hired Mr. Saren as an insurance agent before he had
complied with the necessary requirements.

The one page comment filed by the private respondent presents
only one argument, “that private respondent is performing a function truly
indispensable and necessary to the business of petitioner which fact makes his
work regular as purviewed
by the Labor Code of the Philippines.” (Rollo, p. 85).

We fail to see what is so indispensable and necessary in the work of a trainee who was only
being prepared to take the government examinations for insurance agents. Mr. Saren was given a “training
subsidy” and not a salary. He was
not hired as a clerk, officer manager, accountant, or house counsel or to fill
any other regular job in the firm.

One other point mentioned by the Solicitor General refers to the
strange procedure in this case, followed in the then Ministry of Labor and
Employment, where a Labor
Arbiter alters an order of the Deputy Minister which is not only correct but is already final.

The Solicitor-General
states:

“The resolution of the issue, we submit, hinges on whether or
not Labor Arbiter Potenciano Cenizares, Jr. had the juris­diction to alter the
Order issued by Deputy Minister Vicente Leogardo, Jr. finding private respondent Victor R. Saren as a mere
Trainee and not a regular employee of petitioner.

“The maxim is ‘a judgment whether correct or wrong becomes
final when not appealed’ (Malia v. Intermediate
Appellate Court, 138 SCRA 117), ‘which deprives the court jurisdiction to alter
final judgment’ (Soliven v. WCC, 77 SCRA 518).

“It is a matter
of record that on August 11, 1981, Deputy Minister Vicente Leogardo, Jr. issued
an Order finding Victor T. Saren as a mere trainee and NOT a regular employee
of GREPALIFE. The above Order was not
appealed by private respondent and therefore became final and executory. Such being the case, Labor Arbiter
Potenciano Cenizares acted with grave abuse of discretion in altering such
final order. That Labor Arbiter
Potenciano Cenizares, Jr. committed a grave abuse of discretion is more glaring
consider­ing that he altered a judgment coming from an appellate body. The Order, therefore, of Labor Arbiter
Potenciano Cenizares, Jr. finding Victor T. Saren as a regular employee and on
the basis of which he (Labor Arbiter) ordered petitioner to pay additional
benefits to Victor T. Saren is NULL and VOID and in legal effect no judgment. By it, no rights are divested. From them, no rights can be obtained. Being worthless in itself, all proceedings founded upon them are
equally worthless. They neither bind
nor bar anyone (Abbain v. Chua, 22 SCRA 748).” (Rollo, pp. 106-107).

There has to be a measure
of finality to unappealed administrative decisions insofar as the Department or
agency is concerned. More so, if the
decision is correct as in this case.

WHEREFORE, the petition is hereby granted. The resolution of the National Labor
Relations Commission dated December 20, 1985 is set aside. The private respondent’s complaint is
dismissed. The temporary restraining order issued on April 28,
1986 is made permanent.

SO ORDERED.

Fernan, (Chairman), Paras, Padilla, Bidin, and Cortes, JJ., concur.

^[1]
The Solicitor General was assisted by Assistant Solicitor General Ramon H.
Barcelona and Solicitor Romeo R. Ramolete.