No AEP, void employment

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Is an employment contract valid if a non-resident alien has no alien employment permit?

  • No, the employment contract is void as AEP is specifically required by law.

McBurnie v. Ganzon, EGI-Managers, Inc.
G.R. Nos. 178934 & 178117, 186984-85, 17 October 2013

BACKGROUND:

  • The complainant, an Australian national, instituted a complaint for illegal dismissal and other monetary claims against the (respondents/Company). (The complainant) claimed that on May 11, 1999, he signed a five-year employment agreement with the company… as an Executive Vice-President who shall oversee the management of the company’s hotels and resorts within the Philippines. He performed work for the company until sometime in November 1999, when he figured in an accident that compelled him to go back to Australia while recuperating from his injuries. While in Australia, he was informed by respondent Ganzon that his services were no longer needed because their intended project would no longer push through.
  • The (respondents/Company) opposed the complaint, contending that their agreement with (the complainant) was to jointly invest in and establish a company for the management of hotels. They did not intend to create an employer-employee relationship, and the execution of the employment contract that was being invoked by (the complainant) was solely for the purpose of allowing (him) to obtain an alien work permit in the Philippines. At the time (the complainant) left for Australia for his medical treatment, he had not yet obtained a work permit.

HELD:

  • The employment contract is void.
  • Absent an employment permit, any employment relationship that (the foreign national) contemplated with (the Company) was void for being contrary to law. A void or inexistent contract, in turn, has no force and effect from the beginning as if it had never been entered into. Thus, without an Alien Employment Permit, the “Employment Agreement” is void and could not be the source of a right or obligation. In support thereof, the DOLE issued a certification that McBurnie has neither applied nor been issued an Alien Employment Permit.

References

  • Jurisprudence or Supreme Court Decisions