TITLE 2

EMPLOYEES COMPENSATION AND

STATE INSURANCE FUND
CHAPTER 1
POLICY AND DEFINITION

ART. 166: POLICY

State shall promote and develop
a
tax-exempt
employees
compensation program whereby
employees
and
their
dependents, in the event of
work-connected disability or
death, may promptly secure
adequate income benefit, and
medical related benefits.
FEATURE OF THE NEW COMPENSATION
SHCEME
The employees compensation
scheme under LC applies the
social security principle in the
handling
of
workmens
compensation cases.
Employer does not intervene in
compensation process and it
has no control over payment of
benefits.
All that is required of an
employer is to give contribution
to the State Insurance Fund
from which the compensation
payments are taken.
Employers duty is to only pay
the regular monthly premiums
to the scheme.
Employee no longer required to
litigate
his
right
to
compensation. He simply files a

claim with the Employees

Compensation
Commission
which then determines WON the
compensation should be paid.
No employer opposes the claim
Payments are more prompt
Labor Code has abandoned the
doctrine
of
presumptive
compensability.
Under present law, illness is
compensable only when it is
classified as an occupational
disease and the conditions that
would
render
them
compensable are met. Diseases
not listed are compensable only
if the claimant proves by
substantial evidence that the
risk of contracting the disease is
increased by the conditions of
employment.

COMPENSATION BENEFITS available

only in case work-connected disability
or death arising from:
a. INJURY
b. ILLNESS
*It is not injury or illness which is
compensated but the death or
disability.
COMPENSABILITY OF DISABILITY OR
DEATH ARISING FROM INJURY
To be compensable, the injury
must be the result of an
employment
accident
that
satisfies
all
the
following
conditions:
a. Employee injured at the
place
where
his
work
requires him to be;
b. Employee been performing
his official functions

c. If injury sustained elsewhere,

employee must have been
executing an order from
employer.
It is not necessary that injury be
sustained
within
place
of
employment.
As
long
the
employee acted within the
purview of his employment.
THE PERSONAL COMFORT DOCTRINE
Acts performed by employees within
the time and space limits of his
employment, to minister to his
personal comfort such as satisfaction
of his thirst, hunger, or other physical
demands
shall
be
DEEMED
INCIDENTAL to his employment and
injuries the employee suffered in the
performance of such acts shall be
CONSIDERED AS COMPENSABLE and
arising out of and in the course of
employment.
LUZON STEVEDORING CO. vs. WCC
Where
a
sailor
of
stevedoring
company whose duty was to look after
the safety of the barge, drowned while
swimming
RULING: He went swimming not
for pleasure nor for fun but in
answer to the daily need of
nature. It may be said that he
died in line of duty for he was
undertaking something that is
necessary
to
his
personal
comfort. It is fair and logical
that
the
happening
be
considered as one occurring in
the course of employment for
under the circumstances it
cannot be undertaken in any
other way.

GOING TO AND COMING FROM PLACE

OF WORK DOCTRINE Injury or death
resulting from an accident while the
employee is going to, or coming from,
the workplace is compensable if the ff.
conditions are met:
a. Act of the employee of going to,
or coming from the workplace
must have been a CONTINUING
ACT.
Not
been
diverted
therefrom
from
any
other
activity and not departed from
usual route.
LAZO vs. EMPLOYEES COMPENSATION
COMMISSION
FACTS: Lazo is a security guard. His regular
tour of duty is from 2PM to 10PM. One day,
Lazo rendered duty from 2PM to 10PM but, as
the security guard who was to relieve him
failed to arrive, Lazo rendered overtime duty
upto 5PM. When he asked permission from his
superior to leave early in order to take home
his sack of rice, on his way home, at about
6AM, the passenger jeepney he was riding in
turned turtle due to slippery road and as a
result, he sustained injuries. For the injuries he
sustained, Lazo filed a claim for disability
benefits
HELD: Lazo is entitled to disability benefits.
Employees shall be protected for a reasonable
period of time prior to or after working hours
and for a reasonable distance before reaching
or after leaving employers premises. There is
no evidence that Lazo deviated from his usual
route.

VDA. DE TORBELA vs. EMPLOYEES

COMPENSATION COMMISSION
FACTS: Torbela was employed as school
principal/ he died at about 5:45am due to
injuries sustained by him in vehicular accident
while he was on his way to school from Bacolod
where he lived to Hinigaran where the school of
which is located. In his possession at time of

accident were official papers he allegedly

worked on in his residence on the eve of his
death.
HELD: Claim is compensable. Employee is
accidentally injured at a point reasonably
proximate to the place of work, while he is
going to and from his work, such injury is
deemed to have arisen out of and in the course
of employment.

ALANO vs. EMPLOYEES

COMPENSATION COMMISSION
FACTS: De Vera was employed as school
principal. Her tour of duty was from 7:30AM
5:30PM. One day, at 7AM, while she was
waiting for a ride at Plaza Jaycee on her way to
school, she was bumped and run over by a
speeding Toyota mini-bus which resulted in her
instantaneous death.
HELD: Death is compensable. The deceased
died while going to her place of work. She was
at the place where her job necessarily required
her to be if she was to reach her place of work
on time. She was there because of her
employment required her to be there.

LENTEJAS vs. EMPLOYEES

COMPENSATION COMMISSION
FACTS: Lentejas was employed as general
foreman and his working hours were from 8AM
to 5PM. He went to barangay Banti to inspect
work being done on a damaged seawall. At
around 4:30PM, when he was on his way home
from that place, he was attacked and stabbed
with a knife by Arnulfo Luaton who inflicted
upon him multiple stab wounds that caused his
instantaneous death. Police showed that the
killing was brought about a personal grudge.
HELD: The killing took place at 4:30 PM during
his official hours of work. He was on official
time and in the course of performing his official
functions when he was attacked. The deceased
was at a place where his work required him to
be. There is no evidence to show that the route
he took in leaving the situs of the damaged
seawall was not a usual or convenient route
from that place.

ENAO vs. EMPLOYEES COMPENSATION

COMMISSION
FACTS: Enao, a teacher was on her way from
official station at Sergio Osmena, ZDN to
Dipolog City for the purpose of securing
supplies and other training and school aids
necessary for the furtherance of her services
as school teacher. Upon reaching ZDN, they
were fired upon by a band or armed men
believed to be communist insurgents. As a
result of the ambush, Enao sustained gunshot
wounds which compelled her confinement.
HELD: Enao is entitled to compensation
because she was actually performing her
official functions when the ambush took place.
The fact that the task was done outside of her
regular working hours and outside of her place
of work, is beside the point. The fact that
Dipolog City where she was going is also her
residence does not by itself defeat her claim
for compensation because this fact is at most
simply incidental and/or purely coincidental.
What is significant is that the injuries she
sustained are work-connected.

LOPEZ vs. EMPLOYEES

COMPENSATION COMMISSION
FACTS: Lopez as school teacher, he was
intrusted by the Head of the schools Science
Department to prepare a Model Dam for a
certain contest. To enable him to finish the
Model Dam, he brought it home, and while he
was engrossed in his project, he came in
contact with a live wire and was electrocuted
and died as a result.
HELD: Death is compensable. While the
accident took place in his house and not in his
official work station, he was still discharging his
function as the on in-charge of the project.

VALERIANO vs. EMPLOYEES

COMPENSATION COMMISSION
FACTS: Valeriano was a fire truck driver.
Sometime in the evening, he was standing
along Santolan road QC when he met a friend
and thereafter they decided to proceed to
Binanza Restaurant in EDSA for dinner. On their
way home around 9PM, the owner-type jeepney

there were riding figured in a head-on collision

with another vehicle at the intersection of
N.Domingo and Broadway St. Valeriano was
thrown out of the vehicle and was severely
injured.
HELD: Not compensable. Injuries sustained
after pursuing a purely personal and social
function having dinner with some friends. His
injuries were not acquired at the workplace. For
injury to be compensable, the standard of
work-connection must be substantially satisfied
even by one who invokes the 24-hpurs duty
doctrine.

NITURA vs. EMPLOYEES

COMPENSATION COMMISSION
FACTS: Nitura was a member of the Philippine
Army assigned in ZDN. In the evening, he was
instructed by his battalion Commander to go to
Barangay San Jose which is more or less one
kilometre from the Command Post to check on
several personnel of the Command who were
attending a dance party. On his way back to
the camp, he passed, crossed and fell from a
hanging wooden bridge, as a result of which,
he died.
HELD: Death is compensable. Nitura was
performing an official function when he died.
He was directed by his superior to check on
several personnel of the command then
attending a dance party.

THE
TWENTY-FOUR-HOUR
DOCTRINE

DUTY

A soldier on active duty status is

really on a 24-hour official duty
status and is subject to military
discipline and military law 24
hours a day. He is subject to call
and to the orders of his superior
officers at all times, 7 days a
week, except when he is on
VACATION LEAVE STATUS.

Perceptible that on account of

the nature of their work,
policemen
and
limitary
personnel
have
become
marked
men
insofar
as
insurgents and other lawless
elements are concerned and are
therefore killed by insurgents at
every opportunity.
Moment a policeman or military
personnel suffers a contingency,
it is presumed that it arose from
the nature of his work.
To be entitled to compensation,
the standard of work-connection
must still be established by
substantial evidence.
DEATH OR INJURY WHILE ON VACATION
LEAVE
Not compensable because an
employee who is on leave does
not perform his usual duties.
DE LA REA VS. ECC
FACTS: De La Rea, a member of the Philippine
Navy was granted his vacation leave for 25
days. While enjoying his leave, he was shot to
death for unknown motive by a resident of the
same place. He died instantly from the gunshot
wound.
HELD: Death is not compensable because de la
Rea was not at the time and place where his
work required him to be. Neither was he
performing official functions. His death is not
work-connected. While the days when an
employee is on vacation leave are considered
part of the period of employment, not
everything that transpires during a vacation
leave may be attributed to employment.

MILITARY MEN ON PASS OR ON REST

AND RECREATION
Disability or death arising from
injury by a member of the

military while on pass for a

period not exceeding 72 hours
is compensable. If the soldier
was unable to report himself
back for duty after 72-hour
period, the disability or death is
still compensable if such failure
to report was due to legitimate
and valid reasons such as
fortuitous
event
or
force
majeure.
HINOGUIN VS. ECC
FACTS: Sgt Hinoguin, a member of the
Philippine Army, and 2 other soldiers, sought
permission from Commanding Officer to go on
overnight pass to Aritao to settle an important
matter thereat. They were orally granted
permission and were allowed to take their
issued firearms with them, considering that
Aritao was regarded as a critical place due to
the presence of elements of the NPA in or in
the vicinity of Aritao. Upon reaching the
poblacion of Aritao, he was accidentally shot by
his companion, as a result of which he died.
HELD: Death of Hinoguin is compensable
because it arose out of and in the course of his
employment as a soldier on active duty. A
soldier on active duty is really on 24 hours a
day on official duty status and is subject to
military discipline and military law 24 hours a
day. He is subject to call ad to the orders of his
superior officers at all times, 7 days a week,
except of course when he is on vacation leave
status. The mere fact that Hinoguin was on
overnight pass did not alter the workconnected character of his death because he
did not cease to perform official functions while
on overnight pass.

**Disability or death arising from

injury by a member of the military
while on rest and recreation, which is
considered part of the soldiers
military activities, after having gone
on actual combat duty, as certified to
by the proper commanding officer, is
compensable.

COMPENSABILITY
OF
DEATH
OR
DISABILITY ARISING FROM ILLNESS
DEATH OR DISABILITY ARISING FROM
ILLNESS IS COMPENSABLE:
a. Illness is classifies as an
occupational disease
b. If not classified, the risk of
contracting the same is proven
by substantial evidence to have
been increased by the working
conditions.
COMPENSABILITY OF OCCUPATIONAL
DISEASES
a. Employees work must involve
the described risk
b. Disease was contracted as a
result
of
the
employees
exposure to the described risks
c. Disease was contracted within a
period of exposure and under
such
factors necessary to
contract it
d. Was no notorious negligence on
the part of the employee

THE INCREASED RISK DOCTRINE

Diseases
which
are
not
classified
as
occupational
disease are compensable only
if the claimant can prove that
the risk of contracting the
disease was increased by the
working conditions.
There is increased risk if the
illness
is
caused
by
or
precipitated by factors inherent
in the employees nature of
work and working conditions. It

does not include aggravation of

pre-existing illness.
Not require that there should be
a direct causal connection
between the disease and the
employment. All that is required
is reasonable work-connection,
which could be established by
mere substantial evidence.
It is essential for the claimant to
show that the development of
the disease was brought largely
by the conditions present in the
nature of the job.
Law does not require that the
employment should be the sole
factor
in
the
growth,
development and acceleration
of the illness to entitle him to
compensation benefits. It is
enough that his employment
had contributed, even in a small
degree to the development of
the disease.
Test of evidence: Probability not
certainty.

**INSERT
P.553**

CASES

PROGRESSION/
ILLNESS/INJURY

HERE

P.

542

TO

DETERIORATION

OF

When the primary illness or

injury is shown to have arisen in
the course of the employment,
every natural consequence that
flows from the illness or injury
shall be deemed employmentrelated, hence, compensable.
ART. 167: DEFINITION OF TERMS
"Code" means the Labor Code of the
Philippines

"Commission"
means
the
Compensation Commission.

Employees

"SSS" means the Social Security System

"GSIS" means the
Insurance System

Government

Service

"System" means the SSS or GSIS, as the case

may be.
"Employer" means any person, natural or
juridical, employing the services of the
employee.

"Employee" means any person compulsorily

covered by the GSIS, including the members of
the Armed Forces of the Philippines, and any
person employed as casual, emergency,
temporary, substitute or contractual, or any
person compulsorily covered by the SSS .
"Person" means any individual, partnership,
firm, association, trust, corporation or legal
representative thereof.
"Dependent" means the legitimate, legitimated
or legally adopted or acknowledged natural
child who is unmarried, not gainfully employed,
and not over twenty-one (21) years of age or
over twenty-one (21) years of age provided he
is incapacitated and incapable of self-support
due to a physical or mental defect which is
congenital or acquired during minority; the
legitimate spouse living with the employee and
the parents of said employee wholly dependent
upon him for regular support.
"Beneficiaries" means the dependent spouse
until he/she remarries and dependent children,
who are the primary beneficiaries. In their
absence, the dependent parents and subject to
the restrictions imposed on dependent
children,
the
illegitimate
children
and
legitimate descendants, who are the secondary
beneficiaries: Provided, That the dependent
acknowledged natural child shall be considered
as a primary beneficiary when there are no
other dependent children who are qualified and
eligible for monthly income benefit.
"Injury" means any harmful change in the
human organism from any accident arising out
of and in the course of the employment.
"Sickness" means any illness definitely
accepted as an occupational disease listed by
the Commission, or any illness caused by
employment subject to proof that the risk of
contracting the same is increased by working

conditions. For this purpose, the Commission is

empowered to determine and approve
occupational
diseases
and
work-related
illnesses that may be considered compensable
based on peculiar hazards of employment.
"Death" means loss of life resulting from injury
or sickness.
"Disability" means loss or impairment of a
physical or mental function resulting from
injury or sickness.
"Compensation" means all payments made
under this Title for income benefits and
medical or related benefits.
"Income benefit" means all payments made
under this Title to the providers of medical
care, rehabilitation services and hospital care.

"Medical benefit" means all payments made

under this Title to the providers of medical
care, rehabilitation services and hospital care.
"Related benefit" means all payments made
under this Title for appliances and supplies.
"Appliances" means crutches, artificial aids
and other similar devices.
"Supplies" means medicine and other medical,
dental or surgical items.
"Hospital" means any medical facility,
government or private, authorized by law, an
active member in good standing of the
Philippine Hospital Association and accredited
by the Commission.
"Physician" means any doctor of medicine duly
licensed to practice in the Philippines, an active
member in good standing of the Philippine
Medical Association and accredited by the
Commission.
"Wages" or "Salary", insofar as they refer to
the computation of benefits defined in Republic
Act No. 1161, as amended, for SSS and
Presidential Decree No. 1146, as amended, for
GSIS, respectively, except that part in excess of
Three Thousand Pesos.
"Monthly salary credit" means the wage or
salary base for contributions
"Average monthly salary credit" in the case of
the SSS means the result obtained by dividing
the sum of the monthly salary credits in the
sixty-month period immediately following the

semester of death or permanent disability by

sixty (60), except where the month of death or
permanent disability falls within eighteen (18)
calendar months from the month of coverage,
in which case, it is the result obtained by
dividing the sum of all monthly salary credits
paid prior to the month of contingency by the
total number of calendar months of coverage
in the same period.
"Average daily salary credit" in the case of the
SSS means the result obtained by dividing the
sum of the six (6) highest monthly salary
credits in the twelve-month period immediately
preceding the semester of sickness or injury by
one hundred eighty (180), except where the
month of injury falls within twelve (12)
calendar months from the first month of
coverage, in which case it is the result obtained
by dividing the sum of all monthly salary
credits by thirty (30) times the number of
calendar months of coverage in the period.
In the case of the GSIS, the average daily
salary credit shall be the actual daily salary or
wage, or the monthly salary or wage divided by
the actual number of working days of the
month of contingency.
"Quarter" means a period of three (3)
consecutive months ending on the last days of
March, June, September and December.
"Semester" means a period of two consecutive
quarters ending in the quarter of death,
permanent disability, injury or sickness.
"Replacement ratio" - The sum of twenty
percent and the quotient obtained by dividing
three hundred by the sum of three hundred
forty and the average monthly salary credit.
"Credited years of service" - For a member
covered prior to January, 1975, nineteen
hundred seventy-five minus the calendar year
of coverage, plus the number of calendar years
in which six or more contributions have been
paid from January, 1975 up to the calendar
year containing the semester prior to the
contingency. For a member covered on or after
January, 1975, the number of calendar years in
which six or more contributions have been paid
from the year of coverage up to the calendar
year containing the semester prior to the
contingency.
"Monthly income benefit" means the amount
equivalent to one hundred fifteen percent of
the sum of the average monthly salary credit
multiplied by the replacement ratio, and one
and a half percent of the average monthly
salary credit for each credited year of service

in excess of ten years: Provided, That the

monthly income benefit shall in no case be less
than two hundred fifty pesos.

CHAPTER 2
COVERAGE AND LIABILITY
ART. 168: COMPULSORY COVERAGE
Coverage in the State Insurance
Fund shall be compulsory upon
all
employers
and
their
employees not over sixty (60)
years of age: Provided, That an
employee who is over (60)
years of age and paying
contributions to qualify for the
retirement or life insurance
benefit administered by the
System shall be subject to
compulsory coverage.
COVERED EMPLOYEES
All
employers,
whether
belonging to the public or
private sector are covered
Public sector employers are
those
covered
by
the
Government Service Insurance
System (GSIS) including GOCC,
Phil.
Tuberculosis
Society,
National Red Cross and the Phil.
Veterans Bank.
Private sector employers are
covered by Social Security
System (SSS)
Employees not over 60 years
old whether public or private
sectors are covered.
Employees over 60 years old
are covered if they have been
paying contributions to SSS or
GSIS prior to the age of 60 and
have not been compulsorily
retired.
Employees coverable by both
the SSS and GSIS shall be
coverable by both systems.

ART. 169: FOREIGN EMPLOYMENT

The commission shall ensure
adequate coverage of Filipino
employees employed abroad,
subject to regulations as it may
prescribe
COVERAGE
ABROAD

OF

FILIPINOS

WORKING

Filipinos working abroad for an

employer who carries on in the
Philippine any trade, entitled to
the same benefits given to
employees working in the
Philippines
ART. 170:
COVERAGE

EFFECTIVE

DATE

OF

EFFECTIVE DATE OF COVERAGE

Coverage om employers shall
take effect on the 1st day of
operation but nor earlier than
January 1, 1975
Coverage of employees shall
take effect on the first day of
employment
ART. 171: REGISTRATION
Each
employer
and
his
employees shall register with
the System in accordance with
its regulations

REGISTRATION PROCEDURE
Section 1. Nature
compulsory.

Coverage

shall

be

Sec. 2. Scope (a) Every employer shall be

covered.
(b) Every employee not over sixty (60) years of
age shall be covered.
(c) An employee over sixty (60) years of age
shall be covered if he had been paying
contributions to the System prior to age sixty
(60) and has not been compulsorily retired.

(d) An employee who is coverable by both the

GSIS and SSS shall be compulsorily covered by
both Systems.
Sec. 3. Employer (a) The term shall mean
any person, natural or juridical, domestic or
foreign, who carries on 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.
(b) Any employer shall belong to either:
(1) The public sector covered by the GSIS,
comprising the National Government, including
government-owned or controlled corporations,
the Philippine Tuberculosis Society, the
Philippine National Red Cross and the Philippine
Veterans Bank; or
(2) The private sector covered by the SSS,
comprising all employers other than those
defined
in
the
immediately
preceding
paragraph

WHEN AN
REPORTED

EMPLOYEE

IS

DEEMED

If the SSS or GSIS has received

a
report
or
written
communication about him from
his employer and Employees
Compensation contribution paid
in
his
name
before
a
compensable
contingency
occurs.
EFFECT OF FAILURE TO REPORT
(1) In case of failure or refusal to register
employees, the employer or responsible official
who committed the violation shall be punished
with a fine of not less than P1,000 nor more
than P10,000 and/or imprisonment for the
duration of the violation or non-compliance or
until such time that rectification of the violation
has been made, at the discretion of the Court.
(2) In case a compensable contingency occurs
after thirty (30) days from employment and
before the System receives any report for
coverage
about
the
employee
or
EC
contribution on his behalf, his employer shall
be liable to the System for the lump sum
equivalent of the benefits to which he or his
dependents may be entitled.

ART. 172: LIMITATION OF LIABILITY

The State Insurance Fund shall

be liable for compensation to
the
employee
or
his
dependents, except when the
disability
or
death
was
occasioned by the employees
intoxication, willful intention to
injure or kill himself or another,
notorious
negligence,
or
otherwise provided under this
Title.
FACTORS THAT BAR COMPENSABILITY
1. Intoxication
2. Wilful intention to injure or kill
himself or another
3. Notorious negligence

INTOXICATION Refers to a persons

condition in being under influence of
liquor or prohibited drugs to the extent
that his acts, words or conduct is
impaired visibly, as to prevent him
from physically and mentally engaging
in the duties of his employment
To constitute a ground for denial
of compensation, the degree of
intoxication must be such that it
rendered
the
employee
incapable of doing work. The
accident or injury must be
shown that it arose out of his
drunken condition and not
because of work.
Intoxication which does not
incapacitate the employee from
following his occupation is not
sufficient to defeat the recovery
of
compensation,
although
intoxication
may
be
a
contributory cause to his injury.
WILLFUL INTENTION TO INJURE/KILL
HIMSELF OR ANOTHER
Contemplates
a
deliberate
intent on the part of the

employee to inflict injuries to

himself or another.
The resulting injury, disability or
death was not caused by the
employment
but
by
the
employees own voluntary act.
NOTORIOUS NEGLIGENCE
Something more than mere or
simple
negligence
or
contributory
negligence.
It
signifies a deliberate act of the
employee to disregard his own
personal safety.
More than mere carelessness or
lack
of
foresight
and
is
tantamount to gross negligence.
To constitute ground for denial
of compensation: must be
shown by clear and convincing
proof that it was the cause of
the injury. Disobedience to
rules, orders, and/or prohibition
does not per se constitute
notorious negligence, if no
intention can be attributed to
the injured to end his life.
ART. 173: EXTENT OF LIABILITY
Unless otherwise provided, the
liability of the State Insurance
Fund under this Title shall be
exclusive and in place of all
other liabilities of the employer
to
the
employee,
his
dependents
or
anyone
otherwise entitled to receive
damages on behalf of the
employee or his dependents.
The payment of compensation
under this Title shall not bar the
recovery of benefits as provided
for in Section 699 of the Revised
Administrative Code.
EXCLUSIVENESS OF LIABILITY
The liability of the State
Insurance Fund is exclusive and

in place of all other liabilities

which the employer may have
to the employee
This relieves the employer from
any further obligation to directly
pay compensation benefits to
its
employees
for
workconnected sickness or injury.
New
compensation
scheme
merely
imposes
upon
an
employer the sole obligation to
remit its contribution to State
Insurance Fund
An employer can no longer be
obliged to continue with its
practice of giving compensation
benefits to its employees for
work-connected
injury
or
sickness
SAN MIGUEL CORPORATION vs. NLRC
FACTS: Prior effectivity of LC, It has been a
practice of San Mig to grant to its salesmen
and helpers suffering work-connected sickness
or disability, their basic salary and other
benefits. The aggregate value of these benefits
was higher than the corresponding benefits
under the Workmens Compensation Act. When
new compensation scheme under LC took
effect, San Mig discontinued the practice.
HELD: San Miguel cannot be compelled to
continue with its practice of directly paying
compensation benefits to its employees for
work-connected illness or injury. The new
scheme relieved an employer from obligation
directly paying compensation to his employees
for work-connected illness or injury. It would be
manifestly unfair to require the employer to
maintain 2 systems of compensation.

RECOVERY UNDER OTHER LAWS

Payment of compensation under
this Title shall not bar recovery
of benefits as provided for Sec.
699
of
the
Revised
Administrative Code.
EXCLUSIVENESS Whenever other
laws provide similar benefits for the
same contingency covered by
these rules, the employee who

qualifies for the benefits shall have

the option to choose under which
law benefits will be paid to him.
However,
if
the
benefits
provided by the law chosen are
less than the benefits provided
under these Rules, Employees
Compensation shall pay only
the difference in benefits
Employees shall not be qualified
to avail himself at the time of
similar benefits provided by
different
laws,
except
the
difference
in
benefits
mentioned.
The employer may however
continue to grant benefits
already
earned
by
the
employees under any collective
bargaining agreement or any
other agreement.
THE LABOR CODE VIS--VIS THE CIVIL
CODE
Can the injured employee (or his heir
in case of death), avail of the
compensation benefits under LC and
sue the employer for damages under
Civil Code.
YSMAEL MARITIME CORPORATION vs.
AVELINO
FACTS: Lim, a licensed 2nd mate, was on board
the vessel owned by YMC when the same ran
aground and sank near Batanes. Lim died and
as a result of the incident, a claim for death
benefits was filed by the heirs before
Workmens Compensation Commission, for
which they were paid the sum of P 4,160.00.
Claiming that the death was caused by the
negligence of YMC, the heirs subsequently filed
an action for damages before regular courts.
HELD: Action will not prosper. Heirs of Lim
cannot be allowed to maintain an action for
additional damages under Civil Code because
they had already opted to avail under WCTA. A
sense of fair play would demand that if a
person entitled to a choice of remedies made a
1st election and accepted the benefits thereof,
he should no longer be allowed to exercise the
2nd option.

FLORESCA vs. PHILEX MINING

FACTS:Floresca et al are the heirs of the
deceased employees of Philex, who, while
working at its copper mines underground
operations at Tuba, Benguet, died as a result of
the cave-in that buried them in the tunnels of
the mine. Specifically, the complaint alleges
that Philex, in violation of government rules
and regulations, negligently and deliberately
failed to take the required precautions for the
protection of the lives of its men working
underground. Floresca et al moved to claim
their benefits pursuant to the Workmens
Compensation Act before the Workmens
Compensation
Commission.
They
also
petitioned before the regular courts and sue
Philex for additional damages. Philex invoked
that they can no longer be sued because the
petitioners have already claimed benefits
under the WCA.
HELD: Floresca et al could only do either one. If
they filed for benefits under the WCA then they
will be estopped from proceeding with a civil
case before the regular courts. Conversely, if
they sued before the civil courts then they
would also be estopped from claiming benefits
under the WCA. The SC however ruled that
Floresca et al are excused from this deficiency
due to ignorance of the fact. Had they been
aware of such then they may have not availed
of such a remedy. However, if in case theyll
win in the lower court whatever award may be
granted, the amount given to them under the
WCA should be deducted. The SC emphasized
that if they would go strictly by the book in this
case then the purpose of the law may be
defeated. Idolatrous reverence for the letter of
the law sacrifices the human being. The spirit
of the law insures mans survival and ennobles
him. As Shakespeare said, the letter of the law
killeth but its spirit giveth life.

DISTINCTION
BETWEEN
COMPENSATION AND DAMAGES
COMPENSATION Given to mitigate
the harshness and insecurity of
industrial life for the workman and his
family. So long as the death, injury or
illness is work-connected, entitlement
to compensation exists, regardless of
the negligence of the employer.
DAMAGES Given in order to vindicate
a wrongful invasion of a right. It is

recoverable by a person who has

sustained injury either in person,

property or relative rights, through the

act of default of another.