G.R. No. 81551 . April 27, 1989.
PHILIPPINE NATIONAL CONSTRUCTION CORPORATION, petitioner, vs. PHILIPPINE NATIONAL LABOR RELATIONS COMMISSION (THIRD DIVISION) AND NICOLAS SACEDA, respondents.

FACTS

Petitioner Philippine National Construction Corporation (PNCC) hired private respondent Nicolas Saceda as a driver/operator for a road project in Saudi Arabia under a two-year contract. Upon the completion of his contract on January 27, 1984, Saceda was scheduled for repatriation. However, his departure was delayed. PNCC booked him for a flight on February 21, 1984, but Saceda refused to depart at that time because he was awaiting the resolution of a separate complaint he had filed against PNCC before Saudi labor authorities for unpaid benefits.
The Saudi labor authorities eventually ruled in Saceda’s favor on March 24, 1984. After PNCC paid the awarded claims, Saceda agreed to be repatriated and returned to the Philippines on March 27, 1984. Subsequently, Saceda filed a complaint with the Philippine Overseas Employment Administration (POEA) seeking payment for his withheld salary allotment and “stand-by pay” for the period from January 27 to March 27, 1984, claiming he was made to wait idle for two months after his contract ended.

ISSUE

Whether the Philippine National Construction Corporation is liable to pay Nicolas Saceda stand-by pay for the period of delay in his repatriation.

RULING

Yes, the Supreme Court affirmed PNCC’s liability for stand-by pay. The legal basis is rooted in the employment contract and the provisions of the Civil Code on obligations. The contract required PNCC to notify the employee two months before the contract’s end regarding extension or repatriation. Within this period, PNCC, which held Saceda’s passport and travel documents, was obligated to process his exit papers for immediate repatriation upon contract termination. The Court found that the stipulated two-month period was sufficient for this purpose. PNCC’s failure to secure the travel documents on time constituted delay in the performance of its contractual obligation.
Under Article 1170 of the Civil Code, those guilty of delay in the performance of their obligations are liable for damages. PNCC’s delay compelled Saceda to remain idle in a foreign land, and the stand-by pay represents the damages for the income he could have earned had he been promptly repatriated. The Court rejected PNCC’s argument that Saceda’s refusal to depart on February 21 absolved it of liability. Saceda’s refusal was to await the outcome of his justified complaint against PNCC, which the Saudi authorities later upheld. Therefore, the necessity for that litigation arose from PNCC’s own unjust refusal to pay his valid claims. Consequently, PNCC is liable for stand-by compensation covering the entire period from January 28 to March 27, 1984. The petition was dismissed and the NLRC decision was affirmed with modification as to the period covered.