G.R. No. 205703 - Industrial Personnel and Management Services, Inc. vs. De Vera

SNC-Lavalin offered Arriola a 19-month contract (June 9, 2008–December 31, 2009) as Safety Officer at CA$32/hr.
Contract and letter of understanding were executed in the Philippines and processed by POEA.
After three months of work, Arriola received pre-termination notice (September 9, 2009) citing diminishing workload; he was repatriated September 15, 2009.
SNC-Lavalin credited CA$2,636.80 to Arriola’s bank account under Canadian law.
Arriola filed for illegal dismissal and unpaid benefits, claiming entitlement to unpaid salaries for the unexpired contract term (P1,062,936.00).

Labor Arbiter (LA) dismissed the complaint, applying Ontario’s Employment Standards Act (ESA) under EDI-Staffbuilders.
National Labor Relations Commission (NLRC) reversed, ruling Philippine law applied and finding dismissal illegal; awarded CA$81,920.00 (later reduced to three months, three weeks’ pay).
Court of Appeals (CA) partially granted petitioners’ certiorari, applied Philippine law, declared dismissal illegal, and computed backpay at CA$19,200.00.
Supreme Court petition challenges CA’s rejection of ESA and confirms Philippine law governs.

Philippine labor and social legislation are matters of public policy and protect OFWs (1987 Constitution, Article XIII, Section 3).
A foreign law may govern an overseas contract only if all four requisites are met:
1. Express stipulation of the foreign law in the contract.
2. Proof of the foreign law in accordance with Philippine Rules of Evidence.
3. Foreign law not contrary to Philippine law, morals, public order or public policy.
4. Contract processed through POEA.
In the absence or failure of any requisite, Philippine law applies (lex loci contractus; processual presumption).

Foreign Law Applicability

Requisites 2 and 4 (proof of ESA; POEA processing) were satisfied.
Requisite 1 failed: the contract did not expressly specify the application of Canadian law or the ESA.
Requisite 3 failed: key ESA provisions (no requirement of just cause for termination; allowance to dispense with notice by payment of severance) conflict with the Filipino employee’s right to security of tenure (Labor Code Articles 279–281) and due process (Constitution, Article III, Section 1).
Conclusion: ESA cannot govern; Philippine law applies.

Validity of Dismissal

Under Article 279 of the Labor Code, dismissal requires just or authorized cause and compliance with due process.
Petitioners invoked financial losses and redundancy but offered only hearsay (news article) without credible evidence or identification of specific authorized cause.
Failure to substantiate authorized cause renders the dismiss

Petitioner IPAMS is a Philippine-registered placement agency; Angelito C. Hernandez is its president and managing director.
Petitioner SNC Lavalin is a Canadian construction and engineering company and principal of IPAMS.
Respondent Alberto B. Arriola, a licensed Philippine general surgeon, was offered employment by SNC Lavalin as Safety Officer in the Ambatovy Project, Madagascar.
The contract, signed in the Philippines and processed through the POEA, provided CA$32.00/hour for 40 hours/week, plus overtime, running from June 9, 2008 to December 31, 2009 (19 months).
On September 9, 2009, SNC Lavalin issued a pre-termination notice effective September 11, 2009, citing diminished workload and lack of alternative assignments; Arriola was repatriated on September 15 and paid CA$2,636.80 under Canadian law.
Aggrieved, Arriola filed for illegal dismissal and nonpayment of various benefits, claiming roughly P 1,062,936.00 in unpaid salary for the unexpired contract period and insisting that Canadian law be proven applicable before use.

Denied illegal dismissal, attributing the termination to the 2008 global financial crisis and economic slowdown in Madagascar.
Presented a March 5, 2009 Financial Post article on SNC Lavalin’s stock decline as proof of financial distress.
Cited EDI-Staffbuilders International, Inc. v. NLRC: parties may validly incorporate foreign law in an OFW contract.
Argued lex loci celebrationis applies since documents were processed in Canada and the Ontario office drafted the Expatriate Policy.
Contended Canadian law (ESA of Ontario), which they authenticated and certified, requires no particular grounds for early termination—only written notice—and permits dismissal by severance pay alone.
Added that, even under Philippine law, redundancy and retrenchment are valid grounds for dismissal.

May 31, 2010 Decision by Labor Arbiter Jose G. De Vera dismissed Arriola’s complaint for lack of merit.
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