December 13, 1996
DAR OPINION NO. 119-96
Atty. Jeremias U . Montemayor
41 Highland Drive, Blue Ridge
Quezon City
Dear Atty. Montemayor:
This has reference to your letter addressed to then Secretary Ma. Nieves R. Confessor of the Department of Labor and Employment but indorsed to the Department of Agrarian Reform for the reason that some of the queries posed therein deals with R.A. 6657 (Comprehensive Agrarian Reform Law), to wit:
a) Are schemes employed by corporate farms legal or in avoidance of CARP coverage?
b) What remedies can be provided to the workers to protect their rights as CARP beneficiaries?
You state that it came to your knowledge that some of the plantations under CARP deferment have implemented several ingenious schemes apparently to avoid coverage by CARP; that some employees have been forcibly terminated or pressured into resigning with the promise that they will be rehired, albeit on casual or contractual basis; that as a result of these schemes, the retrenched employees are relegated to a mere labor contractor who provides labor services to the company which will eventually disqualify them as beneficiaries under R.A. 6657; that there is a possibility that the companies may put in dummy workers to take their place, or work for the subdivision of the plantations into smaller plots in order to place said landholding beyond the scope of CARP; and that these schemes will effectively shield the companies from complying in the profit sharing arrangements as mandated by CARL.
Anent your first query, it is submitted that the interim schemes employed or adopted by corporate farms pending final distribution of the land to the farmer-beneficiaries are legal. These are the production and profit sharing mandated under Section 16 of Executive Order No. 229 and Sections 13 and 32 of RA 6657, and Commercial Farm Deferment as provided in Section 11 of RA 6657 as implemented by DAR Administrative Order No. 16, Series of 1988. Any other scheme employed by corporate farms purposely to place the subject property outside CARP coverage is a clear circumvention of R.A. 6657. Likewise, if it should be proven that the landowner filed fraudulent declarations and/or that there was clear intent to circumvent the law, all agricultural landholdings of the landowner shall be subject to immediate acquisition and distribution by DAR without prejudice to the application of Section 74 of R.A. 6657 on Penalties.
Anent your second query, to safeguard the rights of farmer-beneficiaries the DAR has adopted several measures to ensure the coverage and distribution of landholdings under CARP deferment to qualified farmer-beneficiaries. Aside from monitoring the farm as to compliance with the commercial farm deferment and production and profit sharing, the DAR shall undertake the necessary steps towards the acquisition and distribution of the property. These include valuation of the land, and, more importantly, facilitating the organization of the farmers by partner NGOs/People's Organization in the area. Likewise, the DAR can avert the circumvention of R.A. 6657 on deferment of commercial farming by requiring the landowner to make available to DAR the farm's premises for ocular inspection, his personnel for interview and his records for examination during normal business hours.
We hope to have clarified matters with you.
Very truly yours,
(SGD.) LORENZO R. REYES
OIC-Undersecretary
LAFMA