NPM No. 049-2015

Requesting Entity: City of Valenzuela

Issues Concern: Final Judgment of Violation of Labor Law or Social Legislation



Effect of a final judgment against a contractor for a violation of labor law or social legislation.

[I]n GPPB Circular No. 01-2008, a final judgment against a contractor for a violation of labor law or social legislation is included as one of the means to verify the bidder's compliance with existing labor laws and standards, such that an affirmative finding of the existence of such final judgment is considered as a valid and lawful cause to post-disqualify a bidder, thereby forfeiting its right to enter into a procurement contract with government

[T]he inclusion of "final judgment involving violation of labor law or social legislation" as one of the recitals in the Sworn Statement is not intended to be a ground to "perpetually disqualify" a market operator or private entity from participating in public bidding. Instead, the goal is to ensure that government only transacts with contractors that promote and protect the welfare of laborers; and there is no clearer indication of a violation of labor law or social legislation than a final judgment by a competent court to that effect.

The Supreme Court, in the case of Jacinto v. Gumaru, Jr , held that "[w]hen a judgment has been satisfied, it passes beyond review, satisfaction being the last act and the end of the proceedings, and payment or satisfaction of the obligation thereby established produces permanent and irrevocable discharge." Consequently, a final judgment relative to the violation of labor laws or social legislations, once proven to have been fully satisfied, shall discharge the adjudged violator from the effects of such judgment, and shall no longer serve as a ground for disqualification or to prevent its participation in the government procurement opportunity, unless there are other valid grounds to disqualify the bidder.