6/7/2020
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considerations of law, morals, good customs, public order, or public policy that underlie
the contract central to the controversy. As the dispute in that case related to the illegal
termination of the employees due to their pregnancy, then it involved a matter of public
interest and public policy. Thus, it was ruled that Philippine laws properly found
application and that Philippine tribunals could assume jurisdiction.
Based on the foregoing, the general rule is that Philippine laws apply even to overseas
employment contracts. This rule is rooted in the constitutional provision of Section 3,
Article XIII that the State shall afford full protection to labor, whether local or overseas.
Hence, even if the OFW has his employment abroad, it does not strip him of his rights
to security of tenure, humane conditions of work and a living wage under our
Constitution.[39]
As an exception, the parties may agree that a foreign law shall govern the employment
contract. A synthesis of the existing laws and jurisprudence reveals that this exception
is subject to the following requisites:
1. That it is expressly stipulated in the overseas employment contract
that a specific foreign law shall govern;
2. That the foreign law invoked must be proven before the courts
pursuant to the Philippine rules on evidence;
3. That the foreign law stipulated in the overseas employment contract
must not be contrary to law, morals, good customs, public order, or
public policy of the Philippines; and
4. That the overseas employment contract must be processed through
the POEA.
The Court is of the view that these four (4) requisites must be complied with before the
employer could invoke the applicability of a foreign law to an overseas employment
contract. With these requisites, the State would be able to abide by its constitutional
obligation to ensure that the rights and well-being of our OFWs are fully protected.
These conditions would also invigorate the policy under R.A. No. 8042 that the State
shall, at all times, uphold the dignity of its citizens whether in country or overseas, in
general, and the Filipino migrant workers, in particular.[40] Further, these strict terms
are pursuant to the jurisprudential doctrine that "parties may not contract away
applicable provisions of law especially peremptory provisions dealing with matters
heavily impressed with public interest,"[41] such as laws relating to labor. At the same
time, foreign employers are not at all helpless to apply their own laws to overseas
employment contracts provided that they faithfully comply with these requisites.
If the first requisite is absent, or that no foreign law was expressly stipulated in the
employment contract which was executed in the Philippines, then the domestic labor
laws shall apply in accordance with the principle of lex loci contractus. This is based on
the cases of Sameer Overseas and PCL Shipping.
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