Escolar Documentos
Profissional Documentos
Cultura Documentos
- versus - Present:
FLORENTINO ABUAN, JOSELITO YNARES-SANTIAGO, J.
RAZON, JERRY ASENSE, HERCULES Chairperson
RICAFUENTE, MARIO GURAY, AUSTRIA-MARTINEZ,
ROLANDO NAELGA, JUAN VILLARUZ, CHICO-NAZARIO,
MARIO SANTIAGO, ROGELIO NACHURA, and
MOCORRO, CALPITO MENDOLES, REYES, JJ.
RENE CORALES, FRANCISCO
ABENTAJADO, BONNIE ESPAOLA,
ERNESTO DE JESUS and RODRIGO
RUZGAL, Promulgated:
Respondents. July 30, 2008
x----------------------------------------------------------x
The Regional Director based his Order on the results of the inspection conducted
on April 23, 1997 by one of its inspectors who found that petitioner New Bay Haven
Restaurant, located at the Army and Navy Club, Kalaw St., Manila, under the
ownership or management of petitioner Te, committed the following violations:
Labor Standards Law:
1.
Underpayment of minimum wage.
2.
Underpayment of thirteenth month pay.
3.
Underpayment of regular holiday pay.
4.
Underpayment of special holiday pay.
5.
Non-payment of night shift differential pay.
DECISION
AUSTRIA-MARTINEZ, J.:
Before us is a Petition for Review on Certiorari under Rule 45 of the Rules of Court,
On December 18, 1997, New Bay-Haven Restaurant and its co-petitioner Te filed
seeking a reversal of the Decision[1] of the Court of Appeals (CA) dated July 15, 2003,
with the DOLE-NCR Regional Office a Motion for Reconsideration of the November 7,
which denied the petition for certiorari filed by Bay Haven, Inc., Johnny T. Co and
1997 order, alleging that the office had no jurisdiction over the case and that the
order was issued in denial of petitioners' right to due process. [5] They argued that
dated April 18, 2000 and September 19, 2001, issued by Undersecretary Jose
jurisdiction over the case was lodged with the National Labor Relations Commission
M. Espaol, Jr. (DOLE Undersecretary) and Secretary Patricia Sto. Tomas (DOLE
(NLRC), and not the DOLE-NCR, due to the amount of the claims involved. They
added that their right to due process was also denied because the order was issued
well as the Resolution[2] dated November 5, 2003 of the CA, which denied
without them being furnished copies of the complaint and the inspection report and
exercise of its visitorial, inspection and enforcement powers, through its Regional
Director for the National Capital Region (NCR), issued an Order dated November 7,
the first order.[7] The order, however, stated that the DOLE had jurisdiction over the
case, pursuant to the Labor Code, as amended by Republic Act (R.A.) No. 7730, that
discharged and that the DOLE had no jurisdiction over the case.[15]
of Labor and Employment.[8] Consequently, another hearing for the case was set.
Treating the motion for reconsideration as an appeal, the DOLE Undersecretary
During the hearing on September 14, 1998, petitioners submitted their Position
issued a Resolution dated April 18, 2000, denying the appeal filed by petitioners,
Paper attaching thereto payroll sheets and waivers and quitclaims allegedly signed
[16]
by the respondents to prove that petitioner properly paid respondents the amounts
upon to deny respondents' claims, and reiterating that the DOLE had jurisdiction to
due them.
[9]
upholding the Regional Director's finding that the quitclaims could not be relied
On May 12, 2000, petitioners filed a Motion for Reconsideration [18] of the April 18,
Jerry Asense and Joselito Razon, however, outrightly denied the validity of the
payroll sheets and quitclaims.In their Joint Affidavit dated October 29, 1998,
respondents claimed that the actual daily pay they received was much smaller than
the amounts stated in the payroll and they denied having received the cash amount
Aggrieved, petitioners filed a Petition for Certiorari under Rule 65 of the Rules of
stated in the quitclaims.[10] They added that they were merely forced to sign the
Court with the CA, seeking to annul and set aside the April 18, 2000 Resolution and
payrolls and quitclaims in blank and in one sitting after they were accepted as
On July 15, 2003, the CA rendered its Decision,[21] dismissing the petition, ruling that
the DOLE had jurisdiction over the labor standards case and that petitioners did not
On December 29, 1998, the DOLE-NCR Regional Director, giving credence to the
affidavit of the respondents denying the validity of the payroll sheets and quitclaims,
issued an Order denying petitioners' motion for reconsideration of the Order
Petitioners filed a Motion for Reconsideration of the Decision which the CA denied in
[12]
Bay Haven, Inc., its President Johnny T. Co, and/or Vivian Te as the ones liable as
employers of respondents. However, the liability of petitioners was reduced
to P468,444.16.[13]
On January 18, 1999, petitioners filed a Motion for Reconsideration of the Order
dated December 29, 1998.[14] In the motion, petitioners insisted that their
3.
4.
Respondents did not file a comment on the petition, but instead filed a
Memorandum[23] simultaneous with petitioners' filing of their Memorandum.[24]
We summarize the issues as follows: 1) whether the DOLE Secretary and her
authorized representatives have jurisdiction to impose the monetary liability against
petitioners; and 2) whether the DOLE-NCR, as upheld by the DOLE Secretary and
the CA committed an error in awarding the claims of respondents.
The DOLE Secretary and her authorized representatives such as the DOLE-NCR
Regional Director, have jurisdiction to enforce compliance with labor standards laws
under the broad visitorialand enforcement powers conferred by Article 128 of
the Labor Code, and expanded by R.A. No. 7730, to wit:
Art. 128. Visitorial and Enforcement Power. (a) The Secretary of Labor and Employment or his duly
authorized representatives, including labor regulation officers,
shall have access to employer's records and premises at any time
of the day or night whenever work is being undertaken therein,
and the right to copy therefrom, to question any employee and
investigate any fact, condition or matter which may be necessary
to determine violations or which may aid in the enforcement of
this Code and of any labor law, wage order or rules and
regulations issued pursuant thereto.
(b) Notwithstanding the provisions of Articles 129 and 217
of this Code to the contrary, and in cases where the
relationship of employer-employee still exists, the
Secretary of Labor and Employment or his duly
authorized representatives shall have the power to issue
compliance orders to give effect to the labor standards
provisions of this Code and other labor legislation based
on the findings of laboremployment and enforcement
officers or industrial safety engineers made in the course
of inspection. The Secretary or his duly authorized
representatives shall issue writs of execution to the appropriate
authority for the enforcement of their orders, except in cases
where
the
employer
contests
the
findings
of
the labor employment and enforcement officer and raises issues
supported by documentary proofs which were not considered in
the course of inspection.
An order issued by the duly authorized representative of the
Secretary of Labor and Employment under this article may be
appealed to the latter. In case said order involves a monetary
award, an appeal by the employer may be perfected only upon
the posting of a cash or surety bond issued by a reputable
bonding company duly accredited by the Secretary of Labor and
Employment and Employment in the amount equivalent to the
monetary award in the order appealed from. (Emphasis supplied)
The Court has held that the visitorial and enforcement powers of the Secretary,
The records also clearly indicate that the Regional Director and the DOLE Secretary
exercised
resolved
through
his
representatives,
encompass
compliance
with
all labor standards laws and other laborlegislation, regardless of the amount of the
claims filed by workers.
[27]
the
case
based
only
on
the
following
violations
found
by
the labor inspection officer, which do not include illegal dismissal, thus:
This has been the rule since R.A. No. 7730 was enacted
1.
2.
3.
4.
5.
6.
and his representatives to address. The questioned Orders dated December 29,
case, because in respondent Abuan's complaint, one of the entries reads as follows:
1998, April 18, 2000 and September 19, 2001 did not mention illegal dismissal, and
properly so, because there was no such finding in the inspector's report.[31] Being in
the nature of compliance orders, said orders, under Art. 128(b) of the Labor Code,
are strictly based on the findings of labor employment and enforcement officers
Petitioners contend that the complaint's own allegation of illegal dismissal meant
x x x made in the course of inspection, and not on any complaint filed. Though a
complaint may initiate the case or an inspection, its allegations may not necessarily
Moreover, Abuan's allegation of illegal dismissal was his personal accusation, and
did not necessarily apply to all the other employees. The records also do not
respondent Abuan is concerned, his allegation of illegal dismissal had deprived the
other potential violations of labor laws and regulations were within the obligation of
DOLE of jurisdiction as per Art. 217 of the Labor Code,[30] the same does not hold for
the
the rest of the respondents, who do not claim to have been illegally dismissed. For
affect Abuan's remaining co-workers. Under Art. 128, the Regional Director can
one, petitioners failed to raise this matter with the Regional Director or even the
conduct inspections and check all violations of labor laws, and enforce compliance
Regional
Director
to
investigate,
especially
insofar
as
they
complaint that has been filed or its allegations. In fact, the article is silent on
whether the filing of a complaint is even required to initiate the exercise of the
inspection and enforcement powers.
Art. 128. Visitorial and Enforcement Power. (b) Notwithstanding the provisions of Articles 129 and 217 of this
Code to the contrary, and in cases where the relationship of
employer-employee still exists, the Secretary of Labor and
Employment or his duly authorized representatives shall have the
power to issue compliance orders to give effect to
the labor standards
provisions
of
this
Code
and
other labor legislation based on the findings of labor employment
and enforcement officers or industrial safety engineers made in
the course of inspection. The Secretary or his duly authorized
representatives shall issue writs of execution to the appropriate
authority for the enforcement of their orders, except in cases
where the employer contests the findings of
the labor employment and enforcement officer and raises
issues supported by documentary proofs which were not
considered in the course of inspection.
Petitioners also insinuate that they were effectively denied due process at the earlier
stages of the controversy, as they claim that during the inspection, the inspector did
not even bother to talk to any them. [32] Again, petitioners are raising serious, factual
allegations in this late stage of their appeal. They never mentioned this alleged
infraction in the very
Reconsideration[33] of
the
first
Regional
Director's
or in their
Order
[34]
Motion
for
dated November
7,
depriving the concerned officer, that is, the labor inspector, of the chance to deny or
refute such serious allegations.
x x x x (Emphasis supplied)
Petitioners themselves cannot deny that due process was afforded them after the
inspection. For one thing, their motion for reconsideration of the Order
Again, petitioners fail to persuade. The mere disagreement by the employer with
dated November 7, 1997 was granted, which resulted in the re-opening of the
the
were given the chance to air their side. Petitioners also submitted their position
paper, in which they summarized all their arguments and presented their
jurisdiction
findings
to
of
exercise
or
the
simple
enforcement
act
powers
of
under
refute the respondents' claims, as well as the inspector's findings. In the petition
now before us, petitioners themselves claim that they seasonably contested the
findings of the labor inspector.
[35]
conclusion is that the demands of due process were satisfied, as petitioners had
been
given
all
the
opportunity
to
be
heard. It
has
been
held
that
Next, petitioners argue that the regional director was divested of jurisdiction
because petitioners contested the findings of the labor inspection officer. This,
Thus, in SSK Parts Corporation v. Camas,[38] in which the employer contested the
allegedly, is in accordance with Art. 128(b) of the Labor Code, which states:
Regional Director's finding of violations of labor standards, but such issue was
DOLE Secretary. For these reasons, the exclusion clause of Art.128(b) does not
ordinary course of inspection, it was held that there was no more need to indorse
apply.
Thus, the key requirement for the Regional Director and the DOLE Secretary to be
divested of jurisdiction is that the evidentiary matters are not verifiable in the
course of inspection. Where the evidence presented was verifiable in the normal
course of inspection, even if presented belatedly by the employer, the Regional
Director, and later the DOLE Secretary, may still examine them; and these officers
are not divested of jurisdiction to decide the case.
In addition, the findings of the said officers on the invalidity or low probative value of
these documents are findings of a factual nature which this Court will accord with
great respect.[41]
As to the quitclaims, we need only to reiterate the policy laid down in AFP Mutual
Benefit Association, Inc. v. AFP-MBAI-EU,[42] which states:
In labor jurisprudence, it is well established that quitclaims and/or
complete releases executed by the employees do not estop them
from pursuing their claims arising from the unfair labor practice of
the employer.The basic reason for this is that such quitclaims
and/or complete releases are against public policy and, therefore,
null and void. The acceptance of termination pay does not divest
a laborer of the right to prosecute his employer for
unfair labor practice acts. (Cario vs. ACCFA, L-19808, September
29, 1966, 18 SCRA 163; Philippine Sugar Institute vs. CIR, L13475, September 29, 1960, 109 Phil. 452; Mercury Drug Co. vs.
CIR, L-23357, April 30, 1974, 56 SCRA 694, 704)
In the Cario case, supra, the Supreme Court, speaking thru Justice
Sanchez, said:
Acceptance of those benefits would not amount
to estoppel. The reason is plain. Employer and
employee, obviously, do not stand on the same
footing. The employer drove the employee to
the wall. The latter must have to get hold of
money. Because, out of job, he had to face the
harsh necessities of life. He thus found himself
in no position to resist money proffered. His,
then, is a case of adherence, not of choice. One
thing sure, however, is that petitioners did not
relent their claim. They pressed it. They are
deemed not to have waived any of their
rights. Renuntiatio non praesumitur.
inspection and, granting that they were not examined by the labor inspector, they
have nevertheless been thoroughly examined by the Regional Director and the
The principle enunciated above, however, should benefit only the respondents in
the present case who outrightly denied the quitclaims' validity, because it may be
supposed that those who did not protest petitioners' presentation of the quitclaims
their status,[47] but failed to do so. We can only conclude, therefore, that there is no
in evidence have admitted the same by their silence. [43] In such instance, only
respondents
Francisco Abentajado,
Mario Guray,
Juan Villaruz,
Jerry Asense and Joselito Razon are deemed to have blocked the quitclaims'
However, we do not sustain petitioners' allegation that the Regional Director and the
DOLE Secretary erroneously awarded overtime pay to the respondents, despite the
lack of proof that overtime work had been rendered. Suffice it to state that
Anent the second issue, petitioners contend that the Regional Director and the
petitioners' own evidence, which are the payroll sheets they submitted to the
DOLE Secretary committed error in their award of the various claims of respondents,
Regional Director,[48] show that respondents indeed rendered overtime work. This
specifically citing the award to certain respondents whom they deny having worked
as their employees.
them.[49] Aptly, this then became one of the bases of the Regional Director's award
of overtime pay to respondents.
Here, there is merit in petitioners' contentions. Although the basic rule is that
questions of facts like this may not be addressed in a petition for review, there are
In summary, we hold that only the awards granted to the following respondents be
affirmed:
facts.[45] At the earliest possible opportunity, that is, as early as the position paper
1.
2.
3.
4.
5.
filed on September 14, 1998, petitioners already denied being the employers of the
respondents Calpito Mendoles and
Reconsideration
[46]
in
their
Motion
for
to Rolando Naelga, who was not in the labor inspector's and Regional Director's
original list of petitioners' workers and against whom petitioners were not afforded
the chance to present countervailing evidence.Since then, petitioners have
consistently denied liability as employers of these respondents. These respondents,
however, not only failed to controvert this denial by petitioners, they also did not
participate in the proceedings of the case, as shown by the records. Thus, there was
a failure to prove the existence of an employer-employee relationship between
petitioners and these particular respondents. Respondents could have easily proven
their relationship by presenting any of the following: their appointment letters or
employment contracts, payrolls, organization charts, Social Security System
registration, personnel list, as well as the testimonies of co-employees to confirm
Juan Villaruz
Francisco Abentajado
Jerry Asense
Mario Guray
Joselito Razon
The award in favor of Florentino Abuan is deleted, as his claim for illegal dismissal
is within the original and exclusive jurisdiction of the Labor Arbiter, and outside of
the jurisdiction of the DOLE Secretary and the Regional Director. The awards
granted to the rest of the respondents are likewise deleted for lack of evidence to
prove petitioners' liability as to them.
WHEREFORE,
the
decision
appealed
from
is AFFIRMED,
with
No costs.
SO ORDERED.
EX-BATAAN
VETERANS
SECURITY
AGENCY,
INC., petitioner,
vs.
THE SECRETARY OF LABOR BIENVENIDO E. LAGUESMA, REGIONAL
DIRECTOR BRENDA A. VILLAFUERTE, ALEXANDER POCDING, FIDEL
BALANGAY, BUAGEN CLYDE, DENNIS EPI, DAVID MENDOZA, JR.,
GABRIEL TAMULONG, ANTON PEDRO, FRANCISCO PINEDA, GASTON
DUYAO, HULLARUB, NOLI DIONEDA, ATONG CENON, JR., TOMMY
BAUCAS, WILLIAM PAPSONGAY, RICKY DORIA, GEOFREY MINO,
ORLANDO RILLASE, SIMPLICIO TELLO, M. G. NOCES, R. D. ALEJO,
and P. C. DINTAN, respondents.
DECISION
CARPIO, J.:
The Case
This is a petition for review 1 with prayer for the issuance of a temporary
restraining order or writ of preliminary injunction of the 29 May 2001
Decision2 and the 26 February 2002 Resolution 3 of the Court of Appeals in
CA-G.R. SP No. 57653. The 29 May 2001 Decision of the Court of Appeals
affirmed the 4 October 1999 Order of the Secretary of Labor in OS-LS-04-4097-280. The 26 February 2002 Resolution denied the motion for
reconsideration.
NAME
DEFICIENCY
1. ALEXANDER POCDING
P 36,380.85
2. FIDEL BALANGAY
36,380.85
3. BUAGEN CLYDE
36,380.85
4. DENNIS EPI
36,380.85
36,380.85
6. GABRIEL TAMULONG
36,380.85
The Facts
Ex-Bataan Veterans Security Agency, Inc. (EBVSAI) is in the business of
providing security services while private respondents are EBVSAI's
employees assigned to the National Power Corporation at Ambuklao Hydro
Electric Plant, Bokod, Benguet (Ambuklao Plant).
On 20 February 1996, private respondents led by Alexander Pocding
(Pocding) instituted a complaint4 for underpayment of wages against
EBVSAI before the Regional Office of the Department of Labor and
Employment (DOLE).
On 7 March 1996, the Regional Office conducted a complaint inspection at
the Ambuklao Plant where the following violations were noted: (1) nonpresentation of records; (2) non-payment of holiday pay; (3) non-payment
of rest day premium; (4) underpayment of night shift differential pay; (5)
non-payment of service incentive leave; (6) underpayment of 13 th month
pay; (7) no registration; (8) no annual medical report; (9) no annual work
10
7. ANTON PEDRO
36,380.85
36,380.85
8. FRANCISCO PINEDA
36,380.85
36,380.85
9. GASTON DUYAO
36,380.85
36,380.85
10. HULLARUB
36,380.85
TOTAL
P 763,997.85
36,380.85
xxxx
SO ORDERED.7
36,380.85
36,380.85
36,380.85
36,380.85
36,380.85
36,380.85
EBVSAI filed a motion for reconsideration 8 and alleged that the Regional
Director does not have jurisdiction over the subject matter of the case
because the money claim of each private respondent exceeded P5,000.
EBVSAI pointed out that the Regional Director should have endorsed the
case to the Labor Arbiter.
In a supplemental motion for reconsideration, 9 EBVSAI questioned the
Regional Director's basis for the computation of the deficiencies due to
each private respondent.
In an Order10 dated 16 January 1997, the Regional Director denied EBVSAI's
motion for reconsideration and supplemental motion for reconsideration.
The Regional Director stated that, pursuant to Republic Act No. 7730 (RA
7730),11 the limitations under Articles 12912 and 217(6)13 of the Labor Code
no longer apply to the Secretary of Labor's visitorial and enforcement
powers under Article 128(b). 14 The Secretary of Labor or his duly
authorized representatives are now empowered to hear and decide, in a
summary proceeding, any matter involving the recovery of any amount of
wages and other monetary claims arising out of employer-employee
relations at the time of the inspection.
EBVSAI appealed to the Secretary of Labor.
36,380.85
11
12
This was further affirmed in our ruling in Cirineo Bowling Plaza, Inc. v.
Sensing,24 where we sustained the jurisdiction of the DOLE Regional
Director and held that "the visitorial and enforcement powers of the
DOLE Regional Director to order and enforce compliance with
labor standard laws can be exercised even where the individual
claim exceeds P5,000."
However, if the labor standards case is covered by the exception clause in
Article 128(b) of the Labor Code, then the Regional Director will have to
endorse the case to the appropriate Arbitration Branch of the NLRC. In
order to divest the Regional Director or his representatives of jurisdiction,
the following elements must be present: (a) that the employer contests the
findings of the labor regulations officer and raises issues thereon; (b) that
in order to resolve such issues, there is a need to examine evidentiary
matters; and (c) that such matters are not verifiable in the normal course
of inspection.25 The rules also provide that the employer shall raise such
objections during the hearing of the case or at any time after receipt of the
notice of inspection results.26
In this case, the Regional Director validly assumed jurisdiction over the
money claims of private respondents even if the claims exceeded P5,000
because such jurisdiction was exercised in accordance with Article 128(b)
of the Labor Code and the case does not fall under the exception clause.
The Court notes that EBVSAI did not contest the findings of the labor
regulations officer during the hearing or after receipt of the notice of
inspection results. It was only in its supplemental motion for
reconsideration before the Regional Director that EBVSAI questioned the
findings of the labor regulations officer and presented documentary
evidence to controvert the claims of private respondents. But even if this
was the case, the Regional Director and the Secretary of Labor still looked
into and considered EBVSAI's documentary evidence and found that such
did not warrant the reversal of the Regional Director's order. The Secretary
of Labor also doubted the veracity and authenticity of EBVSAI's
documentary evidence. Moreover, the pieces of evidence presented by
EBVSAI were verifiable in the normal course of inspection because all
employment records of the employees should be kept and maintained in or
about the premises of the workplace, which in this case is in Ambuklao
Plant, the establishment where private respondents were regularly
assigned.27
WHEREFORE, we DENY the petition. We AFFIRM the 29 May 2001
Decision and the 26 February 2002 Resolution of the Court of Appeals in
CA-G.R. SP No. 57653.
SO ORDERED.
13
MEDIALDEA, J.:
This petition for review on certiorari (which We treat as a special civil
action for certiorari) seeks to annul the decision of the National Labor
Relations Commission dated November 29, 1988, which reversed the
decision of the Labor Arbiter dated February 10, 1988 in NLRC NCR Case
No. 12-4861-86 (Filomena Barcenas v. Rev. Sim See, etc., et al.) on the
ground that no employer-employee relationship exists between the parties.
Petitioner alleged in her position paper the following facts:
In 1978, Chua Se Su (Su for short) in his capacity as the Head Monk of the
Buddhist Temple of Manila and Baguio City and as President and Chairman
of the Board of Directors of the Poh Toh Buddhist Association of the Phils.
Inc. hired the petitioner who speaks the Chinese language as secretary and
interpreter. Petitioner's position required her to receive and assist Chinese
visitors to the temple, act as tourist guide for foreign Chinese visitors,
attend to the callers of the Head Monk as well as to the food for the temple
visitors, run errands for the Head Monk such as paying the Meralco, PLDT,
MWSS bills and act as liaison in some government offices. Aside from her
pay and allowances under the law, she received an amount of P500.00 per
month plus free board and lodging in the temple. In December, 1979, Su
assumed the responsibility of paying for the education of petitioner's
nephew. In 1981, Su and petitioner had amorous relations. In May, 1982, of
five months before giving birth to the alleged son of Su on October 12,
1982, petitioner was sent home to Bicol. Upon the death of Su in July,
14
In spite of this finding, her status as a regular employee ended upon her
return to Bicol in May, 1982 to await the birth of her love-child allegedly by
Su The records do not show that petitioner filed any leave from work or
that a leave was granted her. Neither did she return to work after the birth
of her child on October 12, 1982, whom she named Robert Chua alias Chua
Sim Tiong. The NLRC found that it was only in July, 1983 after Su died that
she went back to the Manila Buddhist Temple. Petitioner's pleadings failed
to rebut this finding. Clearly, her return could not be deemed as a
resumption of her old position which she had already abandoned.
Petitioner herself supplied the reason for her return. She stated:
. . . (I)t was the death-bed instruction to her by Chua Se Su
to stay at the temple and to take care of the two boys and
to see to it that they finish their studies to become monks
and when they are monks to eventually take over the two
temples as their inheritance from their father Chua Se Su. 4
Thus, her return to the temple was no longer as an employee but rather as
Su's mistress who is bent on protecting the proprietary and hereditary
rights of her son and nephew. In her pleadings, the petitioner claims that
they were forcefully evicted from the temple, harassed and threatened by
respondents and that the Poh Toh Buddhist Association is a trustee
corporation with the children as cestui que trust. These claims are not
proper in this labor case. They should be appropriately threshed out in the
complaints already filed by the petitioner before the civil courts. Due to
these claims, We view the respondents' offer of P10,000.00 as indicative
more of their desire to evict the petitioner and her son from the temple
rather than an admission of an employer-employee relations.
Anent the petitioner's claim for unpaid wages since May, 1982 which she
filed only in 1986, We hold that the same has already prescribed. Under
Article 292 of the Labor Code, all money claims arising from employeremployee relations must be filed within three years from the time the
cause of action accrued, otherwise they shall forever be barred.
Finally, while petitioner contends that she continued to work in the temple
after Su died, there is, however, no proof that she was re-hired by the new
Head Monk. In fact, she herself manifested that respondents made it clear
to her in no uncertain terms that her services as well as her presence and
that of her son were no longer needed. 5 However, she persisted and
continued to work in the temple without receiving her salary because she
expected Chua and Dee to relent and permit the studies of the two
15
16
asked her to come closer, and when she did, held her hand, then touched
and fondled her breast. She stated that he fondled her breast five times,
and that she felt afraid. [3] A classmate of hers, one Vincent B. Sorrabas,
claiming to have witnessed the incident, testified that the fondling incident
did happen just as AAA related it.[4]
that the incident happened in about two or three seconds, and that the girl
left his office without any complaint.[7]
January 28, 1999, both issued by the Civil Service Commission (CSC),
dismissing petitioner from the service for Grave Misconduct.
In Resolution No. 98-0521 dated March 11, 1998, the CSC found petitioner
guilty of Grave Misconduct (Acts of Sexual Harassment), and dismissed him
Republic Act No. (RA) 7877, the Anti-Sexual Harassment Act of 1995.
Petitioner filed a motion for reconsideration, but the same was denied in
Resolution No. 99-0273 dated January 28, 1999.
AAA claimed that on August 16, 1995, petitioner asked her to be at his
office to do an errand.[2] Once inside, she saw him get a folder from one of
the cartons on the floor near his table, and place it on his table. He then
17
Petitioner then brought the matter to the CA under Rule 43 of the 1997
Rules of Civil Procedure, the recourse docketed as CA-G.R. SP No. 51900.
2.
3.
3.
Petitioner argues that the CSC cannot validly adjudge him guilty
He further argues that the offense of Misconduct does not include the
around petitioners right to due process, and based on its finding that
different from that specified in the formal charge which was Misconduct.
charged with disgraceful and immoral conduct and misconduct, the CSC
found that the allegations and evidence sufficiently proved petitioners guilt
of grave misconduct, punishable by dismissal from the service.
The petitioner now raises the following issues in the present petition:
1.
2.
18
[14]
It may be
discerned, with equal certitude, from the acts of the offender. The CSC
found, as did the CA, that even without an explicit demand from
molesting a child is, by any norm, a revolting act that it cannot but be
petitioner his act of mashing the breast of AAA was sufficient to constitute
school. Petitioner has violated that trust. The charge of grave misconduct
that she felt fear at the time petitioner touched her. [12] It cannot then be
said that the CSC lacked basis for its ruling, when it had both the facts
was rightly found guilty of grave misconduct. Under Rule IV, Section 52 of
and the law. The CSC found the evidence presented by the complainant
with it the penalty of dismissal for the first offense. Thus, the penalty
ruling complained of.[15] These elements are present in this case, where
CSC, it is clear that there is misconduct on the part of petitioner. The term
petitioner was properly informed of the charge and had a chance to refute
it, but failed.
19
WHEREFORE,
in
view
of
the
foregoing,
this
petition
is
SO ORDERED.
20
OCEAN
BUILDERS
CONSTRUCTION
CORP., and/or DENNIS HAO,
Petitioners,
Present:
- versus SPOUSES
ANTONIO
CUBACUB,
Respondents.
and
ANICIA
Promulgated:
April 13, 2011
The hospital did not allow Bladimir to leave the hospital. He was
x--------------------------------------------------x
DECISION
then confined, with Narding keeping watch over him. The next day, April
13, 1995, a doctor of the hospital informed Narding that they needed to
talk to Bladimirs parents, hence, on Silanggas request, their co-workers
June Matias and Joel Edrene fetched Bladimirs parents from Tarlac.
At about 8 oclock in the evening of the same day, April 13, 1995,
Caloocan City.
Hermes Frias (Dr. Frias), arrived at the Caybiga Hospital and transferred
Bladimir to the Quezon City General Hospital (QCGH) where he was placed
in the intensive care unit and died the following day, April 14, 1995.
manager, to rest for three days which he did at the companys barracks
where he lives free of charge.
Three days later or on April 12, 1995, Bladimir went about his usual
chores of manning the gate of the company premises and even cleaned
Frias recorded the causes of death as cardiac arrest, multiple organ system
failure, septicemia and chicken pox.
the company vehicles. Later in the afternoon, however, he asked a coworker, Ignacio Silangga (Silangga), to accompany him to his house in
the
Tarlac
Regional
Trial
Court
(RTC)
at
Capas
a complaint
for
21
4.
5.
death.
By Decision of April 14, 1997, [1] Branch 66 of the Tarlac RTC at Capas
6.
dismissed the complaint, holding that Hao was not negligent. It ruled that
Hao was not under any obligation to bring Bladimir to better tertiary
7.
8.
9.
Labor Code. It went on to state that Hao should have foreseen that
Bladimir, an adult, could suffer complications from chicken pox and, had he
been brought to hospitals like St. Lukes, Capitol Medical Center, Philippine
Petitioners maintain that Hao exercised the diligence more than what the
General Hospital and the like, Bladimir could have been saved.
At the onset, the Court notes that the present case is one for damages
based
on torts,
the
employer-employee
relationship
being
merely
1.
2.
elements must be present, viz: (1) duty (2) breach (3) injury and proximate
3.
causation. The assailed decision of the appellate court held that it was the
employees under Art. 161 of the Labor Code, failing which a breach is
committed.
22
(b)
(c)
when
Bladimir
became
ill
amounted
to
the
necessary
23
QCGH, septicemia and chicken pox per Dr. Frias. In fact, Dr. Frias admitted
efficient intervening cause, produces injury, and without which, the result
that the causes of death in both certificates were the same. [8]
actually causing the injury or damage, and that the injury or damage was
omission.
[6]
anymore once the latter was brought to the ICU at QCGH. [9]
apart from adopting the appellate courts findings, finds that Bladimir
contracted chicken pox from a co-worker and Hao was negligent in not
well. This finding is not, however, borne by the records. Nowhere in the
correct, unless the party who contests its accuracy can produce positive
appellate courts or even the trial courts decision is there any such definite
finding that Bladimir contracted chicken pox from a co-worker. At best, the
received by the City Civil Registrar on April 17, 1995. Not only was the
only allusion to another employee being afflicted with chicken pox was
when Hao testified that he knew it to heal within three days as was the
more than that issued by Dr. Frias, becomes more pronounced as note is
taken of the fact that he was not around at the time of death.
happened.
[7]
the dissent, noting that Dr. Frias attended to Bladimir during his last illness,
holds that the certificate which he issued citing chicken pox as
antecedent cause deserves more credence.
the
Court
of
hereby DISMISSED.
There appears, however, to be no conflict in the two death
certificates on the immediate cause of Bladimirs death since both cite
cardio-respiratory arrest due to complications from pneumonia per
Appeals
is REVERSED,
and
the
complaint
is
24
amended.
Present:
QUISUMBING, J., Chairperson,
CARPIO MORALES,
NACHURA,*
BRION, and
PERALTA,** JJ.
- versus -
Promulgated:
March 4, 2009
x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
Shangri-la to grant them the wages and benefits due them as regular
DECISION
Arbiter noted that they usually perform work which is necessary and
desirable to Shangri-las business; that they observe clinic hours and render
services only to Shangri-las guests and employees; that payment for their
salaries were recommended to Shangri-las Human Resource Department
(HRD); that respondent doctor was Shangri-las in-house physician, hence,
also an employee; and that the MOA between Shangri-la and respondent
Shangri-la
claimed,
however,
that
petitioners
were
not
its
25
petitioner and Shangri-la. In so deciding, the NLRC held that the Arbiter
employer-employee
relationship
erred in interpreting Article 157 in relation to Article 280 of the Labor Code,
petitioners. The
as what is required under Article 157 is that the employer should provide
to the finding of the Arbiter, even if Article 280 states that if a worker
appellate
court
exists
between
concluded
that
all
Shangri-la
and
aspects
the
of
Shangri-la on a retainer basis, under which she could hire her own nurses
and other clinic personnel.
Petitioners insist that under Article 157 of the Labor Code, Shangrila is required to hire a full-time registered nurse, apart from a physician,
hired them and not respondent doctor, the NLRC noted that the
applications for employment were made by persons who are not parties to
struck down as being void ab initio. At most, they argue, the MOA is a mere
the case and were not shown to have been actually hired by Shangri-la.
job contract.
On the issue of payment of wages, the NLRC held that the fact
contractor for she has no license or business permit and no business name
by Shangri-las HRD did not prove that it was Shangri-la which pays their
wages. It
thus
credited
respondent
doctors
explanation
that
the
recommendations for payment were based on the billings she prepared for
contracting.
retained physician; that respondent doctor has no control over how the
which, by Decision[5] of May 22, 2007, affirmed the NLRC Decision that no
26
(a)
(b)
The
services
of
a fulltime registered nurse, a parttime physician and dentist, and
an emergency clinic, when the
number of employees exceeds
two hundred (200) but not
more than three hundred (300);
and
(c)
ART.
157. Emergency
medical
and
dental
services. It shall be the duty of every employer to
furnish his employees in any locality with free medical
and dental attendance and facilities consisting of:
27
emergency
clinic
which
means
that it
should provide
or
make
refer to the kind of services that the nurse will render in the companys
[8]
Vera teaches:
x x x For, we take it that any
agreement may provide that one party
28
On
the
other
hand,
existence
of an
of
the
(2) power of dismissal; (3) the payment of wages by whatever means; and
(4) the power to control the worker's conduct, with the latter assuming
primacy in the overall consideration.[12]
which
are
not
directly
related
to
Shangri-las
principal
is
generally
the staff[13]; group life, group personal accident insurance and life/death
insurance[14] for the staff with minimum benefit payable at 12 times the
business; the nature and extent of the work; the skill required; the term
employees last drawn salary, as well as value added taxes and withholding
taxes, sourced from her P60,000.00 monthly retainer fee and 70% share of
specified piece of work; the control and supervision of the work to another;
the service charges from Shangri-las guests who avail of the clinic
the employer's power with respect to the hiring, firing and payment of the
contractor's workers; the control of the premises; the duty to supply the
workers, pay their SSS premium as well as their wages if they were not
premises, tools, appliances, materials and labor; and the mode, manner
by
considering
the
following
[11]
established
29
With respect to the supervision and control of the nurses and clinic
staff, it is not disputed that a document, Clinic Policies and Employee
Manual[16] claimed to have been prepared by respondent doctor exists, to
which petitioners gave their conformity [17] and in which they acknowledged
their co-terminus employment status. It is thus presumed that said
document, and not the employee manual being followed by Shangri-las
regular workers, governs how they perform their respective tasks and
responsibilities.
by
Shangri-las
officers
do
not
imply
that
it is
Shangri-las
management and not respondent doctor who exercises control over them
or that Shangri-la has control over how the doctor and the nurses perform
their work. The letter[18] addressed to respondent doctor dated February 7,
2003 from a certain Tata L. Reyes giving instructions regarding the
replenishment of emergency kits is, at most, administrative in nature,
related as it is to safety matters; while the letter [19] dated May 17, 2004
from Shangri-las Assistant Financial Controller, Lotlot Dagat, forbidding the
clinic from receiving cash payments from the resorts guests is a matter of
financial policy in order to ensure proper sharing of the proceeds,
considering that Shangri-la and respondent doctor share in the guests
payments for medical services rendered. In fine, as Shangri-la does not
control how the work should be performed by petitioners, it is not
petitioners employer.
WHEREFORE, the petition is hereby DENIED. The Decision of the
Court of Appeals dated May 22, 2007 and the Resolution dated July 10,
2007 are AFFIRMED.
SO ORDERED.
30
x------------------------------------------------------------------------------------x
shop workers, technicians, trailer drivers, and mechanics. Six years later,
or on May 1, 2003, LSC entered into another contract with BMSI, this time,
DECISION
a service contract.[5]
NACHURA, J.:
In September 2003, petitioners filed with the Labor Arbiter (LA) a
complaint for regularization against LSC and BMSI. On October 1, 2003,
Petitioners Emmanuel Babas, Danilo T. Banag, Arturo V. Villarin, Sr., Edwin
Javier, Sandi Bermeo, Rex Allesa, Maximo Soriano, Jr., Arsenio Estorque,
Court the October 10, 2008 Decision [1] of the Court of Appeals (CA) in CA-
G.R. SP. No. 103804, and the January 21, 2009 Resolution, [2] denying its
requisite qualifications for the job. BMSI was willing to reassign petitioners
reconsideration.
who were willing to accept reassignment. BMSI denied petitioners claim for
underpayment of wages and non-payment of 13thmonth pay and other
benefits.
LSC, on the other hand, averred that petitioners were employees of BMSI
31
On January 16, 2008, the NLRC promulgated its decision. [7] Reversing the
LA, the NLRC held:
We find from the records of this case that respondent BMSI
is not engaged in legitimate job contracting.
First, respondent BMSI has no equipment, no office
premises, no capital and no investments as shown in the
Agreement itself which states:
xxxx
VI. RENTAL OF EQUIPMENT
[6.01.] That the CLIENT has several forklifts
and truck tractor, and has
offered to the CONTRACTOR
the use of the same by way
of lease, the monthly rental
of which shall be deducted
from the total monthly
billings of the CONTRACTOR
for the services covered by
this Agreement.
32
3.
4.
5.
6.
7.
8.
9.
Edwin L. Javier
Rex Allesa
Arturo Villarin, [Sr.]
Felixberto C. Anajao
Arsenio Estorque
Maximo N. Soriano, Jr.
Sandi G. Bermeo
LSC went to the CA via certiorari. On October 10, 2008, the CA rendered
the now challenged Decision,[10] reversing the NLRC. In holding that BMSI
was an independentcontractor, the CA relied on the provisions of
Emmanuel B. Babas
Danilo Banag
33
independent contractor. It added that even under the control test, BMSI
would be the real employer of petitioners, since it had assumed the entire
Ombudsman,[17] we
charge and control of petitioners services. The CA further held that BMSIs
requirements only with regard to the petitioner who signed the petition,
but not his co-petitioner who did not sign nor authorize the other petitioner
to sign it on his behalf. Thus, the petition can be given due course only as
to the parties who signed it. The other petitioners who did not sign the
stated
that
the
petition
satisfies
the
formal
petitioners and have no legal standing before the Court. The petition
should
dismissed
outright
with
respect
to
the
non-conforming
petitioners.
be
that
BMSI
is
not
an
independent
contractor,
but
labor-only
Before resolving the petition, we note that only seven (7) of the
by their co-petitioners.
be measured in terms of, and determined by, the criteria set by statute.
[15]
34
In San
Miguel
Semillano, Nelson
Merlyn N. Policarpio,
[19]
Corporation
v.
Vicente
B.
permissible job contracting, the totality of the facts and the surrounding
(b) The contractor has substantial capital or investment; and
labor and occupational safety and health standards, free exercise of the
does not have substantial capital or investment to actually perform the job,
work, or service under its own account and responsibility; and (b) the
employees
recruited,
supplied,
or
placed
by
such
contractor
or
35
There was absolute lack of evidence that BMSI exercised control over them
or their work, except for the fact that petitioners were hired by BMSI.
Second, LSC was unable to present proof that BMSI had substantial
Indubitably,
BMSI
can
only
be
classified
as
labor-only
Petitioners
its Agreement with
lost
their
employment
BMSI. However,
when
the
LSC
terminated
termination
of
least clearly related to, and in the pursuit of, LSCs business. Logically,
when petitioners were assigned by BMSI to LSC, BMSI acted merely as a
labor-only contractor.
Lastly, as found by the NLRC, BMSI had no other client except for
LSC, and neither BMSI nor LSC refuted this finding, thereby bolstering the
NLRC finding that BMSI is a labor-only contractor.
36
of
the
Court
of
Appeals
in
CA-G.R.
SP.
No.
103804
No pronouncement as to costs.
SO ORDERED.
37
38
against forum shopping in view of the fact that the determination of the
issues in the second case hinged on the resolution of those raised in the
first.10 On 19 December 2007, however, Labor Arbiter Jesus Orlando
Quiones (Labor Arbiter Quiones) resolved Sub-RAB 05-04-00041-07 in
favor of petitioners who, having rendered services necessary and related to
ABS-CBNs business for more than a year, were determined to be its
regular employees. With said conclusion found to be buttressed by, among
others, the exclusivity clause and prohibitions under petitioners Talent
Contracts and/or Project Assignment Forms which evinced respondents
control over them,11 Labor Arbiter Quiones disposed of the case in the
following wise:
WHEREFORE, finding merit in the causes of action set forth by the
complainants, judgment is hereby rendered declaring complainants
MONINA AVILA-LLORIN, GENER L. DEL VALLE, NELSON V. BEGINO and MA.
CRISTINA V. SUMAYAO, as regular employees of respondent company, ABSCBN BROADCASTING CORPORATION.
Accordingly, respondent ABS-CBN Broadcasting Corporation is hereby
ORDERED to pay complainants, subject to the prescriptive period provided
under Article 291 of the Labor Code, however applicable, the total amount
of Php2,440,908.36, representing salaries/wage differentials, holiday pay,
service incentive leave pay and 13th month pay, to include 10% of the
judgment award as attorneys fees of the judgment award (computation of
the monetary awards are attached hereto as integral part of this decision).
Moreover, respondents are directed to admit back complainants to work
under the same terms and conditions prevailing prior to their separation
or, at respondents' option, merely reinstated in the payroll.
Other than the above, all other claims and charges are ordered DISMISSED
for lack of merit.12
Aggrieved by the foregoing decision, respondents elevated the case on
appeal before the NLRC, during the pendency of which petitioners filed a
third complaint against the former, for illegal dismissal, regularization,
nonpayment of salaries and 13th month pay, unfair labor practice,
damages and attorneys fees. In turn docketed as NLRC Case No. Sub-RABV-05-03-00039-08, the complaint was raffled to Labor Arbiter Quiones
who issued an Order dated 30 April 2008, inhibiting himself from the case
and denying respondents motion to dismiss on the grounds of res judicata
and forum shopping.13 Finding that respondents control over petitioners
was indeed manifest from the exclusivity clause and prohibitions in the
39
Talent Contracts and/or Project Assignment Forms, on the other hand, the
NLRC rendered a Decision dated 31 March 2010, affirming said Labor
Arbiters appealed decision.14 Undeterred by the NLRCs 31 August 2010
denial of their motion for reconsideration,15 respondents filed the Rule 65
petition for certiorari docketed before the CA as CA-G.R. SP No. 116928
which, in addition to taking exceptions to the findings of the assailed
decision, faulted petitioners for violating the rule against forum shopping. 16
On 29 June 2011, the CA rendered the herein assailed decision, reversing
the findings of the Labor Arbiter and the NLRC. Ruling out the existence of
forum shopping on the ground that petitioners' second and third
complaints were primarily anchored on their termination from employment
after the filing of their first complaint, the CA nevertheless discounted the
existence of an employer-employee relation between the parties upon the
following findings and conclusions: (a) petitioners, were engaged by
respondents as talents for periods, work and the program specified in the
Talent Contracts and/or Project Assignment Forms concluded between
them; (b) instead of fixed salaries, petitioners were paid talent fees
depending on the budget allocated for the program to which they were
assigned; (c) being mainly concerned with the result, respondents did not
exercise control over the manner and method by which petitioner
accomplished their work and, at most, ensured that they complied with the
standards of the company, the KBP and the industry; and, (d) the existence
of an employer-employee relationship is not necessarily established by the
exclusivity clause and prohibitions which are but terms and conditions on
which the parties are allowed to freely stipulate. 17
Petitioners motion for reconsideration of the foregoing decision was
denied in the CA's 3 October 2011 Resolution, 18 hence, this petition.
The Issues
Petitioners seek the reversal of the CAs assailed Decision and Resolution
on the affirmative of the following issues:
40
41
performance and its continued existence. 32 In the same manner that the
practice of having fixed-term contracts in the industry does not
automatically make all talent contracts valid and compliant with labor law,
it has, consequently, been ruled that the assertion that a talent contract
exists does not necessarily prevent a regular employment status. 33
As cameramen/editors and reporters, it also appears that petitioners were
subject to the control and supervision of respondents which, first and
foremost, provided them with the equipments essential for the discharge of
their functions. Prepared at the instance of respondents, petitioners Talent
Contracts tellingly provided that ABS-CBN retained "all creative,
administrative, financial and legal control" of the program to which they
were assigned. Aside from having the right to require petitioners "to attend
and participate in all promotional or merchandising campaigns, activities or
events for the Program," ABS-CBN required the former to perform their
functions "at such locations and Performance/Exhibition Schedules" it
provided or, subject to prior notice, as it chose determine, modify or
change. Even if they were unable to comply with said schedule, petitioners
were required to give advance notice, subject to respondents
approval.34 However obliquely worded, the Court finds the foregoing terms
and conditions demonstrative of the control respondents exercised not only
over the results of petitioners work but also the means employed to
achieve the same.
In finding that petitioners were regular employees, the NLRC further ruled
that the exclusivity clause and prohibitions in their Talent Contracts and/or
Project Assignment Forms were likewise indicative of respondents control
over them. Brushing aside said finding, however, the CA applied the ruling
in Sonza v. ABS-CBN Broadcasting Corporation 35 where similar restrictions
were considered not necessarily determinative of the existence of an
employer-employee relationship. Recognizing that independent contractors
can validly provide his exclusive services to the hiring party, said case
enunciated that guidelines for the achievement of mutually desired results
are not tantamount to control. As correctly pointed out by petitioners,
however, parallels cannot be expediently drawn between this case and
that of Sonza case which involved a well-known television and radio
personality who was legitimately considered a talent and amply
compensated as such. While possessed of skills for which they were
modestly recompensed by respondents, petitioners lay no claim to fame
and/or unique talents for which talents like actors and personalities are
hired and generally compensated in the broadcast industry.
42
43
- versus -
Promulgated:
July 5, 2010
x ------------------------------------------------------------------------------------------------x
DECISION
MENDOZA, J.:
The facts of the case, as found by the Court of Appeals, [3] are as follows:
44
On April 30, 1998, the Labor Arbiter (LA) rendered his decision.
[6]
2.
Per
our
computation
complainants
Vicente
Semillano, Nelson Mondejar and Jovito Remada are entitled
to the amount of P122,085.88 each as full backwages
covering the period June 6, 1995 up to April 30, 1998.
b.
c.
SO ORDERED.[7]
motion and reversed its earlier ruling. It absolved petitioner from liability
and instead held AMPCO, as employer of respondents, liable to pay for
45
the view that the law only required substantial capital or investment. Since
AMPCO had substantial capital of nearly one (1) million then it qualified as
an independent contractor. The NLRC added that even under the control
test, AMPCO would be the real employer of the respondents, since it had
assumed the entire charge and control of respondents services. Hence, an
employer-employee
relationship
existed
between
AMPCO
and
the
respondents.
Feeling
aggrieved
over
the
turnaround
by
the
NLRC,
the
respondents filed a petition for review on certiorari under Rule 65 with the
Court of Appeals (CA), which favorably acted on it.
performed their work within SMCs premises. In advocacy of its claim that
AMPCO is an independent contractor, petitioner relies on the provisions of
the service contract between petitioner and AMPCO, wherein the latter
undertook to provide the materials, tools and equipment to accomplish the
services contracted out by petitioner. The same contract provides that
AMPCO shall have exclusive discretion in the selection, engagement and
discharge of its employees/personnel or otherwise in the direction and
46
control thereof. Petitioner also adds that AMPCO determines the wages of
finality, when supported by ample evidence [14] and affirmed by the CA. The
fact that the NLRC, in its subsequent resolution, reversed its original
decision does not render the foregoing inapplicable where the resolution
itself is not supported by substantial evidence.
Department
of
Labor
and
Employment
(DOLE)
Department
Order No. 10, Series of 1997, defines job contracting and labor-only
contracting as follows:
47
(c) For cases not falling under this Article, the Secretary of
Labor shall determine through appropriate orders whether
or not the contracting out of labor is permissible in the light
of the circumstances of each case and after considering the
operating needs of the employer and the rights of the
workers involved. In such case, he may prescribe conditions
and restrictions to insure the protection and welfare of the
workers.
power with respect to the hiring, firing and payment of the contractor's
workers; the control of the premises; the duty to supply the premises,
tools, appliances, materials, and labor; and the mode, manner and terms
that:
Substantial capital or investment refers to capital
stocks and subscribed capitalization in the case of
corporations, tools, equipment, implements, machineries
and work premises, actually and directly used by the
contractor or subcontractor in the performance or
completion of the job work or service contracted
out. (emphasis supplied)
of payment.[16]
48
neither petitioner nor AMPCO has shown that the latter had clients other
Petitioners averment that AMPCO had total assets amounting
to P932,599.22 and income of P2,777,603.46 in 1994 was squarely
debunked by the LA. Thus:
Furthermore, there are no pieces of evidence that
AMPCO has substantial capital or investment. An
examination its Statement of Income and Changes in
Undivided Savings show that its income for the year 1994
was P2,777,603.46 while its operating expenses for said
year is P2,718,315.33 or a net income of P59,288.13 for the
year 1994; that its cash on hand for 1994 is P22,154.80.
In the case at bench, petitioner faults the CA for holding that the
respondents were under the control of petitioner whenever they performed
the task of loading in the delivery trucks and unloading from them. It,
however, fails to show how AMPCO took entire charge, control and
supervision of the work and service agreed upon. AMPCOs Comment on the
Petition is likewise utterly silent on this point. Notably, both petitioner and
AMPCO chose to ignore the uniform finding of the LA, NLRC (in its original
decision) and the CA that one of the assigned jobs of respondents was to
perform other acts as may be ordered by SMCs officers. Significantly,
Neither
did
petitioner
prove
that
AMPCO
had
substantial
AMPCO, opted not to challenge the original decision of the NLRC that found
it a mere labor-only contractor.
its contracted job, work or service with petitioner. For said reason, there can
be no other logical conclusion but that the tools and equipment utilized by
respondents are owned by petitioner SMC. It is likewise noteworthy that
49
no other logical conclusion can be reached than that it was petitioner, not
Despite the fact that the service contracts [20] contain stipulations
Lastly, petitioner claims that the present case is outside the jurisdiction of
AMPCO, not SMC. Precisely, he has joined the others in filing this complaint
because it is his position that petitioner SMC is his true employer and liable
for all his claims under the Labor Code.
DOLE to prove its claim. It is not conclusive evidence of such status. The
the principal (SMC). The law makes the principal responsible over the
[22]
50
SO ORDERED.
51
to sign a
Cup which
during the
and a half
52
to (a) reinstate complainants within thirty (30) days from the date
of receipt of this decision and to solidarily pay complainants:
SO ORDERED.10
JOSE
MELRENATO GUEVARRA
The Court of Appeals Ruling
BERNARTE
P536,250.00
100,000.00
50,000.00
P211,250.00
The Court of Appeals found petitioner an independent contractor since
respondents did not exercise any form of control over the means and
100,000.00
methods by which petitioner performed his work as a basketball referee.
50,000.00 The Court of Appeals held:
3. exemplary damages
4. 10% attorneys fees
68,625.00
36,125.00
TOTAL
P754,875.00
P397,375.00
or a total of P1,152,250.00
The rest of the claims are hereby dismissed for lack of merit or basis.
While the NLRC agreed that the PBA has no control over the
referees acts of blowing the whistle and making calls during
basketball games, it, nevertheless, theorized that the said acts
refer to the means and methods employed by the referees in
officiating basketball games for the illogical reason that said acts
refer only to the referees skills. How could a skilled referee perform
his job without blowing a whistle and making calls? Worse, how can
the PBA control the performance of work of a referee without
controlling his acts of blowing the whistle and making calls?
SO ORDERED.7
In its 28 January 2008 Decision,8 the NLRC affirmed the Labor Arbiters
judgment. The dispositive portion of the NLRCs decision reads:
WHEREFORE, the appeal is hereby DISMISSED. The Decision of
Labor Arbiter Teresita D. Castillon-Lora dated March 31, 2005 is
AFFIRMED.
Moreover, this Court disagrees with the Labor Arbiters finding (as
affirmed by the NLRC) that the Contracts of Retainer show that
petitioners have control over private respondents.
xxxx
SO ORDERED.9
Respondents filed a petition for certiorari with the Court of Appeals, which
overturned the decisions of the NLRC and Labor Arbiter. The dispositive
portion of the Court of Appeals decision reads:
The Issues
WHEREFORE,
the
petition
is
hereby GRANTED.
The
assailed Decision dated January 28, 2008 and Resolution dated
August 26, 2008 of the National Labor Relations Commission
areANNULLED and SET ASIDE. Private respondents complaint
before the Labor Arbiter is DISMISSED.
53
expiration of ten (10) days after mailing, unless the court otherwise
provides. Service by registered mail is complete upon actual
receipt by the addressee, or after five (5) days from the date he
received the first notice of the postmaster, whichever date is
earlier.
54
55
the PBA officers cannot and do not determine which calls to make or not to
make and cannot control the referee when he blows the whistle because
such authority exclusively belongs to the referees. The very nature of
petitioners job of officiating a professional basketball game undoubtedly
calls for freedom of control by respondents.
Moreover, the following circumstances indicate that petitioner is an
independent contractor: (1) the referees are required to report for work
only when PBA games are scheduled, which is three times a week spread
over an average of only 105 playing days a year, and they officiate games
at an average of two hours per game; and (2) the only deductions from the
fees received by the referees are withholding taxes.
In other words, unlike regular employees who ordinarily report for work
eight hours per day for five days a week, petitioner is required to report for
work only when PBA games are scheduled or three times a week at two
hours per game. In addition, there are no deductions for contributions to
the Social Security System, Philhealth or Pag-Ibig, which are the usual
deductions from employees salaries. These undisputed circumstances
buttress the fact that petitioner is an independent contractor, and not an
employee of respondents.
Furthermore, the applicable foreign case law declares that a referee is an
independent contractor, whose special skills and independent judgment
are required specifically for such position and cannot possibly be controlled
by the hiring party.
In Yonan v. United States Soccer Federation, Inc.,23 the United States
District Court of Illinois held that plaintiff, a soccer referee, is an
independent contractor, and not an employee of defendant which is the
statutory body that governs soccer in the United States. As such, plaintiff
was not entitled to protection by the Age Discrimination in Employment
Act. The U.S. District Court ruled:
Generally, if an employer has the right to control and direct the
work of an individual, not only as to the result to be achieved, but
also as to details by which the result is achieved, an
employer/employee relationship is likely to exist. The Court must
be careful to distinguish between control[ling] the conduct of
another party contracting party by setting out in detail his
obligations consistent with the freedom of contract, on the one
hand, and the discretionary control an employer daily exercises
over its employees conduct on the other.
56
57
were not illegally dismissed. As a matter of fact, they were the ones who
refused to renew their contract and that they voluntarily complied with the
requirements for them to claim their corresponding monetary benefits in
relation thereto; and (2) they were consecutively employed by Zytron and
A.C. Sicat, not by Fonterra. The dispositive portion of the Decision 2 reads:
WHEREFORE, in view of the foregoing, judgment is hereby rendered
DISMISSING
the
instant
case
for
utter
lack
of
merit.
SO ORDERED.
The Case
The NLRC affirmed the Labor Arbiter, finding that respondents separation
from Zytron was brought about by the execution of the contract between
Fonterra and A.C. Sicat where the parties agreed to absorb Zytrons
personnel, including respondents. Too, respondents failed to present any
evidence that they protested this set-up. Furthermore, respondents failed
to refute the allegation that they voluntarily refused to renew their contract
with A.C. Sicat. Also, respondents did not assert any claim against Zytron
and A.C. Sicat. The NLRC disposed of the case in this wise:
WHEREFORE, premises
considered,
the
appeals
are
hereby
ordered DISMISSED and the Decision of the Labor Arbiter is AFFIRMED
[in]toto.
SO ORDERED.3
The NLRC decision was assailed in a petition under Rule 65 before the CA.
Ruling on the petition, the CA, in the questioned Decision, 4 found that A.C.
Sicat satisfies the requirements of legitimate job contracting, but Zytron
does not. According to the CA: (1) Zytrons paid-in capital of P250,000
cannot be considered as substantial capital; (2) its Certificate of
Registration was issued by the DOLE months after respondents supposed
employment ended; and (3) its claim that it has the necessary tools and
equipment for its business is unsubstantiated. Therefore, according to the
CA,
respondents
were
Fonterras
employees.
Additionally, the CA held that respondents were illegally dismissed since
Fonterra itself failed to prove that their dismissal is lawful. However, the
illegal dismissal should be reckoned from the termination of their supposed
employment with Zytron on June 6, 2006. Furthermore, respondents
transfer to A.C. Sicat is tantamount to a completely new engagement by
another employer. Lastly, the termination of their contract with A.C. Sicat
arose from the expiration of their respective contracts with the latter. The
CA, thus, ruled that Fonterra is liable to respondents and ordered the
reinstatement of respondents without loss of seniority rights, with full
58
backwages, and other benefits from the time of their illegal dismissal up to
the time of their actual reinstatement. The fallo of the Decision reads:
WHEREFORE, premises considered, the petition is hereby GRANTED. The
assailed Decision dated 20 November 2009 and Resolution dated 5 March
2010 of the National Labor Relations Commission (NLRC), Seventh Division,
are hereby ANULLED and SET ASIDE. Private respondent Fonterra Brand,
Inc. is hereby ordered to REINSTATE [respondents] without loss of seniority
rights. Private respondents Fonterra Brand, Inc. and Zytron Marketing and
Promotional Corp. are hereby further ORDERED to jointly and severally
pay petitioners their full backwages and other benefits from the time of
their illegal dismissal up to the time of their actual reinstatement; and
attorneys
fees.
II.
Succinctly, the issues in the case at bar are: (1) whether or not Zytron and
A.C. Sicat are labor-only contractors, making Fonterra the employer of
herein respondents; and (2) whether or not respondents were illegally
dismissed.
Our Ruling
We
SO ORDERED.
find
merit
in
the
petition.
The Issues
Zytron and Fonterra moved for reconsideration, but to no avail. Hence, this
petition.
I.
b.
c.
As correctly held by the Labor Arbiter and the NLRC, the termination of
respondents employment with Zytron was brought about by the cessation
of their contracts with the latter. We give credence to the Labor Arbiters
conclusion that respondents were the ones who refused to renew their
contracts with Zytron, and the NLRCs finding that they themselves
acquiesced
to
their
transfer
to
A.C.
Sicat.
By refusing to renew their contracts with Zytron, respondents effectively
resigned from the latter. Resignation is the voluntary act of employees who
are compelled by personal reasons to dissociate themselves from their
employment, done with the intention of relinquishing an office,
accompanied
by
the
act
of
abandonment. 5
Here, it is obvious that respondents were no longer interested in continuing
their employment with Zytron. Their voluntary refusal to renew their
contracts was brought about by their desire to continue their assignment in
Fonterra which could not happen in view of the conclusion of Zytrons
contract with Fonterra. Hence, to be able to continue with their
assignment, they applied for work with A.C. Sicat with the hope that they
will be able to continue rendering services as TMRs at Fonterra since A.C.
Sicat is Fonterras new manpower supplier. This fact is even acknowledged
by the CA in the assailed Decision where it recognized the reason why
respondents applied for work at A.C. Sicat. The CA stated that [t]o
continuously work as merchandisers of Fonterra products, [respondents]
submitted their job applications to A.C. Sicat xxx. 6 This is further bolstered
59
by the fact that respondents voluntarily complied with the requirements for
them to claim their corresponding monetary benefits in relation to the
cessation
of
their
employment
contract
with
Zytron.
In short, respondents voluntarily terminated their employment with Zytron
by refusing to renew their employment contracts with the latter, applying
with A.C. Sicat, and working as the latters employees, thereby abandoning
their previous employment with Zytron. Too, it is well to mention that for
obvious reasons, resignation is inconsistent with illegal dismissal. This
being the case, Zytron cannot be said to have illegally dismissed
respondents,
contrary
to
the
findings
of
the
CA.
As regards respondents employment with A.C. Sicat and its termination via
non-renewal of their contracts, considering that in labor-only contracting,
the law creates an employer-employee relationship between the principal
and the labor-only contractors employee as if such employees are directly
employed by the principal employer, and considers the contractor as
merely the agent of the principal,7 it is proper to dispose of the issue on
A.C. Sicats status as a job contractor first before resolving the issue on the
legality
of
the
cessation
of
respondents
employment.
In this regard, We defer to the findings of the CA anent A.C. Sicats status
as a legitimate job contractor, seeing that it is consistent with the rules on
job contracting and is sufficiently supported by the evidence on record.
A person is considered engaged in legitimate job contracting or
subcontracting if the following conditions concur:
1.
2.
The contractor or
investment; and
subcontractor
has
substantial
capital
or
3.
1.
2.
The contractor does not exercise the right to control over the
performance of the work of the contractual employee.9
2.
3.
Mayors Permit;
4.
5.
6.
7.
60
hereby REINSTATED.
These sufficiently show that A.C. Sicat carries out its merchandising and
promotions business, independent of Fonterras business. Thus, having
settled that A.C. Sicat is a legitimate job contractor, We now determine
whether the termination of respondents employment with the former is
valid.
We agree with the findings of the CA that the termination of respondents
employment with the latter was simply brought about by the expiration of
their
employment
contracts.
Foremost, respondents were fixed-term employees. As previously held by
this Court, fixed-term employment contracts are not limited, as they are
under the present Labor Code, to those by nature seasonal or for specific
projects with predetermined dates of completion; they also include those
to which the parties by free choice have assigned a specific date of
termination.11 The determining factor of such contracts is not the duty of
the employee but the day certain agreed upon by the parties for the
commencement and termination of the employment relationship.12
In the case at bar, it is clear that respondents were employed by A.C. Sicat
as project employees. In their employment contract with the latter, it is
clearly stated that [A.C. Sicat is] temporarily employing [respondents] as
TMR[s] effective June 6[, 2006] under the following terms and conditions:
The need for your service being only for a specific project, your temporary
employment will be for the duration only of said project of our client,
namely to promote FONTERRA BRANDS products xxx which is expected to
be
finished
on
or
before
Nov.
06,
2006. 13
Respondents, by accepting the conditions of the contract with A.C. Sicat,
were well aware of and even acceded to the condition that their
employment thereat will end on said pre-determined date of termination.
They cannot now argue that they were illegally dismissed by the latter
when it refused to renew their contracts after its expiration. This is so since
the non-renewal of their contracts by A.C. Sicat is a management
prerogative, and failure of respondents to prove that such was done in bad
faith militates against their contention that they were illegally dismissed.
The expiration of their contract with A.C. Sicat simply caused the natural
cessation of their fixed-term employment there at. We, thus, see no reason
to
disturb
the
ruling
of
the
CA
in
this
respect.
With
these,
We
need
not
belabor
the
other
assigned
errors.
SO ORDERED.
61
HACIENDA
LEDDY/RICARDO
vs.
PAQUITA VILLEGAS, Respondent.
GAMBOA,
JR., Petitioner,
DECISION
PERALTA, J.:
This is a Petition for Review on Certiorari under Rule 45 of the Rules of
Court seeking the reversal of the Decision 1 dated May 25, 2007 and
Resolution2 dated August 10, 2007 of the Court of Appeals in CA-G.R. SP
No. 01923,3 which granted the Petition for Certiorari under Rule 65 of the
1997 Rules of Civil Procedure filed by Villegas, and reversed the January
26, 2006 and March 31, 2006 Orders of the National Labor Relations
Commission (NLRC). These two Orders issued by the NLRC reversed the
December 3, 2003 Decision of Executive Labor Arbiter Danilo Acosta.
The facts, as culled from the records, are as follows:
Villegas is an employee at the Hacienda Leddy as early as 1960, when it
was still named Hacienda Teresa. Later on named Hacienda Leddy owned
by Ricardo Gamboa Sr., the same was succeeded by his son Ricardo
Gamboa, Jr. During his employment up to the time of his dismissal, Villegas
performed sugar farming job 8 hours a day, 6 days a week work,
continuously for not less than 302 days a year, and for which services he
was paidP45.00 per day. He likewise worked in petitioner's coconut lumber
business where he was paid P34.00 a day for 8 hours work.
On June 9, 1993, Gamboa went toVillegas' house and told him that his
services were no longer needed without prior notice or valid reason.
Hence, Villegas filed the instant complaint for illegal dismissal.
Gamboa, on the other hand, denied having dismissed Villegas but admitted
in his earlier position paper thatVillegas indeed worked with the said farm
owned by his father, doing casual and odd jobs until the latter's death in
1993.4 He was even given the benefit of occupying a small portion of the
land where his house was erected. He, however, maintained that Villegas
ceased working at the farm as early as 1992, contrary to his allegation that
he was dismissed.5
62
63
manifest acts unerringly pointing to the fact that the employee simply does
not want to work anymore.20
Petitioner failed to discharge this burden. Other than the self-serving
declarations in the affidavit of his employee, petitioner did not adduce
proof of overt acts of Villegas showing his intention to abandon his work.
Abandonment is a matter of intention;it cannot be inferred or presumed
from equivocal acts. On the contrary, the filing of the instant illegal
dismissal complaint negates any intention on his part to sever their
employment relationship. The delay of morethan 1 year infiling the instant
illegal dismissal case likewise is non-issue considering that the complaint
was filed within a reasonable period during the three-year period provided
under Article 291 of the Labor Code. 21 As aptly observed by the appellate
court, Villegas appeared tobe without educational attainment. He could not
have known that he has rights as a regular employee that is protected by
law.
The Labor Code draws a fine line between regular and casual employees to
protect the interests of labor. We ruled in Baguio Country Club Corporation
v. NLRC22 that "its language evidently manifests the intent to safeguard the
tenurial interest of the worker who may be denied the rights and benefits
due a regular employee by virtue of lopsided agreements with the
economically powerful employer who can maneuver to keep an employee
on a casual status for as long as convenient." Thus, notwithstanding any
agreements to the contrary, what determines whether a certain
employment is regular or casual is not the will and word of the employer,
to which the desperate worker often accedes, much less the procedure of
hiring the employee or the manner of paying his salary. It is the nature of
the activities performed in relation to the particular business or trades
considering all circumstances, and in some cases the length of time of its
performance and itscontinued existence.23
All these having discussed, as a regular worker, Villegas is entitled to
security of tenure under Article 279 ofthe Labor Code and can only be
removed for cause. We found no valid cause attending to his dismissal and
found also that his dismissal was without due process.
Article 277(b) of the Labor Code provides that:
x x x Subject to the constitutional right of workers to security of tenure and
their right to be protected against dismissal except for a just and
authorized cause and without prejudice to the requirement of notice under
Article 283 of this Code, the employer shall furnish the worker whose
64
65
2. Jovert R. Seva
Supervisor
August 1, 1999
Leadman
4. Michael Pantano
Janitor
5. Marlon C. Consorte
May 6, 1999
Janitor
6. Lord Galisim
Janitor
Janitor
8. Joel G. Junio
May 4, 2000
Service Crew
9. ZaldyR. Marra
Janitor
Janitor
January 6, 2003
Janitor
August 15,2003
Janitor/Sanitation Aide
Factual Antecedents
Respondents
1. Edito Culdora
Date of Hiring
Position
Janitor
66
13.Roel P. Ranee
Janitor/Sanitation Aide
February 1, 2007
January 1, 2004
Janitor
February 1, 2007
Janitor/Sanitation Aide
Janitor
Janitor/Sanitation Aide
February 2, 2004
Service Crew
Supervisor
August 5, 2004
February 1, 2007
Service Crew
Janitor
Service Crew
Halfway through the service contract, the petitioner asked the respondents
to execute individual contracts which stipulated that their respective
employments shall end on December 31, 2008, unless earlier terminated. 10
Janitor
Janitor
Aide
February 1, 2007
Janitor
March 1, 2007
Janitor
February 1, 2007
Janitor
Aide/Sanitation
The LA ruled in the petitioner's favor. He held that the respondents were
not regular employees. They were project employees whose employment
was dependent on the petitioner's service contract with Robinsons. Since
this contract was not renewed, the respondents' employment contracts
67
must
also
be
terminated.13
The petitioner now submits that the CA erred in ruling that the respondents
were regular employees and that they had been illegally dismissed. The
respondents' contracts of employments did not only provide for a fixed
term, but were also dependent on the continued existence of the
Robinsons' service contract.19 Since this main contract had not been
renewed, the respondents' respective employment contracts were properly
terminated. Based on this reasoning, no illegal dismissal took place, only
the
expiration
of
the
respondents'
fixed
term
contracts.
In the absence of any illegal dismissal, the CA also erred in affirming the
NLRC's
award
of
separation
pay
to
the
respondents.
Lastly, the petitioner asserts that Rana and Burgos should not be held
solidarily liable with the corporation for respondents' monetary claims;
they have personalities separate and distinct from the corporation.
The CA also ruled that the fixed term employment contracts signed by the
respondents had no binding effect. The petitioner only used these
contracts to justify the respondents' illegal dismissal; the petitioner never
asked the respondents to execute any contract since their initial hiring.
Only after it became apparent that the petitioner's service contract with
Robinsons would not be renewed (after its expiration on December 31,
2008), did the petitioner ask the respondents to sign their employment
contracts.17 This circumstance, coupled with the threat that the
respondents would not be given their salaries if they would not sign the
contracts, showed the petitioner's intent to use the contracts to prevent
the
respondents
from
attaining
regular
status.
Lastly, the CA held that petitioners Fulgencio V. Rana (Rana) and Monina R.
Burgos (Burgos), the president and general manager of FVR Skills and
Services Exponents, Inc., respectively, are solidarily liable with the
corporation for the payment of the respondents' monetary awards. As
corporate officers, they acted in bad faith when they intimidated the
They further argue that the employment contracts they executed were
void since these were signed under duress; the petitioner threatened not to
release
their
salaries
if
they
would
refuse
to
sign. 21
Lastly, the respondents assert that the CA did not err in holding Rana and
Burgos solidarily liable with the corporation. These officers acted in bad
faith when they obliged the respondents to execute the employment
contracts under threat.22
The Court's Ruling
We
resolve
The
employees,
Article
280
respondents
not
(now
Article
294)23 of
to DENY the
petition.
are
project
regular
employees.
the
Labor
Code
governs
the
68
respondents'
which
are
were
employment
belatedly
voidable.
The records show that at the time of the respondents' dismissal, they had
already been continuously working for the petitioner for more than a year.
Despite this, they never signed any employment contracts with the
petitioner, except the contracts they belatedly signed when the petitioner's
own contract of janitorial services with Robinsons neared expiration.
As already discussed, for an employee to be validly categorized as a
project employee, it is necessary that the specific project or
undertaking had been identified and its period and completion
date determined and made known to the employee at the time of
his engagement. This provision ensures that the employee is completely
apprised of the terms of his hiring and the corresponding rights and
obligations arising from his undertaking. Notably, the petitioner's service
contract with Robinsons was from January 1 to December 31, 2008. The
respondents were only asked to sign their employment contracts for their
deployment with Robinsons halfway through 2008, when the petitioner's
service
contract
was
about
to
expire.
We find the timing of the execution of the respondents' respective
employment contracts to be indicative of the petitioner's calculated plan to
evade the respondents' right to security of tenure, to ensure their easy
dismissal as soon as the Robinsons' contract expired. The attendant
circumstances cannot but raise doubts as to the petitioner's good faith.
If the petitioner really intended the respondents to be project
employees, then the contracts should have been executed right
from the time of hiring, or when the respondents were first
assigned to Robinsons, not when the petitioner's service contract
was winding up. The terms and conditions of the respondents'
engagement should have been disclosed and explained to them from the
commencement of their employment. The petitioner's failure to do so
supports the conclusion that it had been in bad faith in evading the
respondents'
right
to
security
of
tenure.
In Glory Philippines, Inc. v. Vergara,30 the Court rejected the validity of a
fixed term contract belatedly executed, and ruled that its belated signing
was a deliberate employer ploy to evade the employees' right to security
of tenure. As the Court explained:ChanRoblesVirtualawlibrary
69
To us, the private respondent's illegal intention became clearer from such
acts. Its making the petitioners sign written employment contracts
a few days before the purported end of their employment periods
(as stated in such contracts) was a diaphanous ploy to set periods
with a view for their possible severance from employment should
the private respondent so willed it. If the term of the employment
was truly determined at the beginning of the employment, why
was there delay in the signing of the ready-made contracts that
were entirely prepared by the employer? Also, the changes in the
positions supposedly held by the petitioners in the company belied the
private respondent's adamant contention that the petitioners were hired
solely for the purpose of manning PIS during its alleged dry run period that
ended on October 20, 1998. We view such situation as a very obvious ploy
of the private respondent to evade the petitioner's eventual
regularization.31 [Emphasis ours]
Moreover, under Article 1390 of the Civil Code, contracts where the
consent of a party was vitiated by mistake, violence, intimidation, undue
influence or fraud, are voidable or annullable. The petitioner's threat of
nonpayment of the respondents' salaries clearly amounted to intimidation.
Under this situation, and the suspect timing when these contracts were
executed, we rule that these employment contracts were voidable and
were effectively questioned when the respondents filed their illegal
dismissal
complaint.
The
illegally
respondents
were
dismissed.
do
not
agree
with
the
petitioner.
70
liability
of
the
petitioner's
officers
Finally, we modify the CA's ruling that Rana and Burgos, as the petitioner's
president and general manager, should be held solidarity liable with the
corporation for its monetary liabilities with the respondents.
A corporation is a juridical entity with legal personality separate and
distinct from those acting for and in its behalf and, in general, from the
people comprising it. The general rule is that, obligations incurred by
the corporation, acting through its directors, officers and
employees,
are
its
sole
liabilities. 39
A director or officer shall only be personally liable for the obligations of the
corporation, if the following conditions concur: (l)the complainant alleged
in the complaint that the director or officer assented to patently unlawful
acts of the corporation, or that the officer was guilty of gross negligence or
bad faith; and (2) the complainant clearly and convincingly proved such
unlawful
acts,
negligence
or
bad
faith. 40
In the present case, the respondents failed to show the existence of the
first requisite. They did not specifically allege in their complaint that Rana
and Burgos willfully and knowingly assented to the petitioner's patently
unlawful act of forcing the respondents to sign the dubious employment
contracts in exchange for their salaries. The respondents also failed to
prove that Rana and Burgos had been guilty of gross negligence or bad
faith
in
directing
the
affairs
of
the
corporation.
To hold an officer personally liable for the debts of the corporation, and
thus pierce the veil of corporate fiction, it is necessary to clearly and
convincingly establish the bad faith or wrongdoing of such officer, since
bad faith is never presumed. 41 Because the respondents were not able to
clearly show the definite participation of Burgos and Rana in their illegal
dismissal, we uphold the general rule that corporate officers are not
personally liable for the money claims of the discharged employees, unless
they acted with evident malice and bad faith in terminating their
employment.42
WHEREFORE, in light of these considerations, we hereby DENY the
petition. We AFFIRM withMODIFICATION the Court of Appeals' decision
dated December 22, 2011 and resolution dated March 2, 2012 in CA-G.R.
SP No. 120991, which also AFFIRMED the National Labor Relation
Commission's decision dated April 28, 2011 and resolution dated June 16,
71
tracking projects would be pulled out eventually and replaced by new FIs
contracted from an agency. Old FIs would be assigned only to adhoc
projects which were seasonal. This prompted petitioners to file a
consolidated
complaint
for
regularization
before
the
LA. 11
On October 20, 2008, petitioners and TNS were required to file their
respective position papers. On October 21, 2008, petitioners were advised
by TNS not to report for work anymore because they were being pulled out
from their current assignments and that they were not being lined up for
any continuing or incoming projects because it no longer needed their
services. They were also asked to surrender their company
IDs.12 Petitioners, thereafter, filed a complaint for illegal dismissal, overtime
pay, damages, and attorneys fees against TNS. Later, the labor cases for
regularization
and
illegal
dismissal
were
consolidated.
On May 29, 2009, the LA rendered a decision, 13dismissing the complaint on
the ground that petitioners were found to be project employees who knew
the nature of their positions as such at the time of their employment and
who agreed with full understanding that the contracts would lapse upon
completion of the project stated in their respective contracts. 14 The LA
further ruled that even if petitioners were continuously rehired for several
and different projects, the determining factor was whether, at the time of
hiring, the employment was fixed for a specific project or undertaking and
its
completion
was
predetermined.15
The LA was also of the view that petitioners were not illegally dismissed
because as project employees, the employer-employee relationship was
terminated upon completion of the project or phase for which they were
hired. The term of their employment was coterminus with the duration and
until
the
accomplishment
of
the
project. 16
As to the claim for overtime pay and damages, the LA held that petitioners
were not entitled to them.Field personnel were excluded from the coverage
of the minimum requirements on hours of work and overtime pay.
Aggrieved, petitioners filed an appeal before the NLRC. Consequently, the
NLRC rendered its judgment17 in favor of petitioners and reversed the LA
ruling. Thus:
We note that, initially, complainants used to be project employees as
shown by the samples of project-to-project employment contracts, project
clearance slips, and the establishment termination reports adduced in
evidence. Case records, however, show that the last time respondent
company filed an establishment termination report was in
November 2007 indicating project completion on November 30,
2007. What is clear though is that complainants were allowed to
continue working after November 30, 2007. Respondent company did
not adduce in evidence employment contracts relating to the latest
72
EMPLOYEES
[Emphases supplied]
The NLRC further ruled that, being regular employees, petitioners were
illegally dismissed because TNS, who had the burden of proving legality in
dismissal cases, failed to show how and why the employment of petitioners
was terminated on October 21, 2008. 19 Thus, the NLRC set aside the LA
decision and held TNS liable for illegal dismissal, ordering the latter to pay
petitioners
their
respective
backwages
and
separation
pay. 20
TNS moved for reconsideration, but its motion was denied. Thus, it filed a
petition for certiorari with prayer for preliminary injunction and/or
temporary
restraining
order
before
the
CA.
On January 29, 2013, the CA ruled in favor of TNS and opined that the
projects assigned to petitioners were distinct and separate from the other
undertakings of TNS; that they were required to sign project-to-project
employment contracts; and that a corresponding termination report was
made to DOLE for every accomplished project.Further, it stated that the
repeated re-hiring of petitioners for at least one (1) year did not ipso
facto convert their status to regular employees. According to the CA, the
mere fact that a project employee had worked on a specific project for
more than one (1) year did not necessarily change his status from project
employee
to
regular
or
permanent
employee.21
As to the issue of grave abuse of discretion, the CA held that the NLRC
committed such abuse when it refused to consider the pieces of evidence
submitted by TNS during its determination of the merits of the latters
motion for reconsideration. It stressed that the technical rules of evidence
were not binding in labor cases, 22 that even if the evidence was not
submitted to the LA, the fact that it was duly introduced on appeal before
the
NLRC
was
enough
basis
for
it
to
admit
them. 23
Not in conformity, petitioners filed a motion for reconsideration but it was
eventually
denied.
Hence, this petition presenting the following
ARGUMENTS:
WITH DUE RESPECT, THE HONORABLE COURT OF APPEALS ERRED
IN HOLDING THAT THE PETITIONERS ARE NOT REGULAR
OF
THE
RESPONDENT
COMPANY.
At the outset, it must be stressed that the Court is not a trier of facts. In
petitions for review under Rule 45, the Court only resolves pure questions
of law and is precluded from reviewing factual findings of the lower
tribunals,subject to certain exceptions.This case is an exception as this
Court may review factual conclusions of the CA when they are contrary to
those
of
the
NLRC
or
of
the
Labor
Arbiter. 25
Upon review of the records, the evidence failed to clearly, accurately,
consistently, and convincingly show that petitioners were still project
employees
of
TNS.
Article 280 of the Labor Code, as amended, clearly defined a project
employee as one whoseemployment has been fixed for a specific
project or undertaking the completion or termination of which has
been determined at the time of the engagement of the
employee or where the work or service to be performed is seasonal in
nature and the employment is for the duration of the season.Additionally, a
project employee is one whose termination of his employment contract is
reported to the DOLE everytime the project for which he was engaged has
been
completed.
In their Comment,26 the respondents stressed that the NLRC decision was
mainly anchored upon the supposed lack of compliance with the
termination report requirement under the applicable DOLE Department
Orders. The NLRC ruled that petitioners were regular employees for having
been allowed to continue working after the last submitted termination
report. Thus, TNS submitted, albeit belatedly, the termination reports from
November 2007 up to the last termination report filed on November 18,
2008, by attaching it to the motion for reconsideration filed before the
NLRC.27
Although TNS belatedly submitted the supposed lacking termination
reports, it failed to show the corresponding project employment contracts
of petitioners covering the period indicated in the said termination
73
reports.TNS itself stated in its motion for reconsideration 28 before the NLRC
that the project employee status of the employee could be proved by the
employment contracts signed voluntarily by the employees and by the
termination report filed with the DOLE after the completion of every
project.29Yet, no project employment contracts were shown. It is wellsettled that rules of evidence shall be liberally applied in labor cases, but
this does not detract from the principle that piecemeal presentation of
evidence is simply not in accord with orderly justice. 30The NLRC was correct
in saying that in the absence of proof that the subsequent employment of
petitioners continued to be on a project-to-project basis under a contract of
employment, petitioners were considered to have become regular
employees.31
TNS contended that the repeated and successive rehiring of project
employees does not qualify petitioners as regular employees, as length of
service is not the controlling determinant of the employment tenure of a
project employee, but whether the employment has been fixed for a
specific project or undertaking and its completion has been determined at
the time of the engagement of the employee. The repeated rehiring was
only a natural consequence of the experience gained from past service
rendered
in
other
projects.32
In Maraguinot, Jr. v. NLRC,33 the Court held that once a project or work pool
employee has been: (1) continuously, as opposed to intermittently, rehired
by the same employer for the same tasks or nature of tasks; and (2) these
tasks are vital, necessary and indispensable to the usual business or trade
of the employer, then the employee must be deemed a regular employee.
Although it is true that the length of time of the employees service is not a
controlling determinant of project employment, it is vital in determining
whether he was hired for a specific undertaking or in fact tasked to perform
functions vital, necessary and indispensable to the usual business or trade
of the employer.34 Petitioners successive re-engagement in order to
perform the same kind of work firmly manifested the necessity and
desirability of their work in the usual business of TNS as a market research
facility.35 Undisputed also is the fact that the petitioners were assigned
office-based tasks from 9:00 oclock in the morning up to 6:00 oclock in
the evening, at the earliest, without any corresponding remuneration.
The project employment scheme used by TNS easily circumvented the law
and precluded its employees from attaining regular employment status in
the subtlest way possible.Petitioners were rehired not intermittently, but
continuously,contract after contract, month after month, involving the very
same tasks. They practically performed exactly the same functions over
several years. Ultimately,without a doubt, the functions they performed
were indeed vital and necessary to the very business or trade of TNS.
Granting arguendo that petitioners were rehired intermittently, a careful
review of the project employment contracts of petitioners reveals some
other vague provisions. Oddly, one of the terms and conditions in the said
contract stated that:
1.
The need for your services being determinable and for a specific
project starting ____________ your employment will be for the
duration of said project of the Company, namely Project ___________
which is expected to be finished on _____________. The Company
shall have the option of renewing or extending the period
of this agreement for such time as it may be necessary to
complete the project or because we need further time to
determine your competence on the job.
To the Court, the phrase because we need further time to determine your
competence on the job would refer to a probationary employment. Such
phrase changes the tenor of the contract and runs counter to the very
nature of a project employment. TNS can, therefore, extend the contract
which was already fixed when it deemed it necessary to determine
whether or not the employee was qualified and fit for the job. Corollarily,
TNS can likewise pre-terminate the contract not because the specific
project was completed ahead of time, but because of failure to qualify for
the job.Consistently, the terms and conditions of the contract, reads:
4. It is expressly agreed and understood that the Company may terminate
your employment after compliance with procedural requirements of law,
without benefit of termination pay and without any obligation on the part
of the Company, in the event of any breach of any conditions hereof:
xxx
For said reason, at the outset, the supposed project employment contract
was highly doubtful. In determining the true nature of an employment, the
entirety of the contract, not merely its designation or by which it was
denominated, is controlling.Though there is a rule that conflicting
74
SO ORDERED.
a) Backwages:
P72, 205.64
b) Separation Pay:
P4,908.10
P77,113.80
75
February 4, 2015
Basan
Donor
Nicolas
Falguera
April 1996
DECISION
PERALTA, J.:
Before the Court is a petition for review on certiorari under Rule 45 of the
Rules of Court seeking to reverse and set aside the Decision 1 dated August
31, 2005 and Resolution 2 dated August 24, 2006 of the Court of Appeals
(CA) in CA-G.R. SP Nos. 80977 & 87071, which reversed the Resolutions
dated January 30, 20033 and September 24, 20034 of the National Labor
Relations Commission (NLRC) in NLRC 00-02-01419-97.
The factual antecedents are as follows.
On February 18, 1997, petitioners Romeo Basan, Danilo Dizon, Jaime L.
Tumabiao, Jr., Roberto Dela Rama,Jr., Ricky S. Nicolas, Crispulo D. Donor,
Galo Falguera filed a complaint for illegal dismissal with money claims
against respondent Coca-Cola Bottlers Philippines, alleging that respondent
dismissed them without just cause and prior written notice required by law.
In their position paper, petitioners provided for the following material
dates:5
Name of Petitioner
Date of Hiring
Date of Dismissal
Dela Rama
Dizon
October 1988
Tumabiao
February 2, 1992
76
contract of project or other similar proof thereof. 9 It also noted that neither
can petitioners be considered as probationary employees for the fact that
they had performed their services for more than six (6) months. In
addition, the NLRC upheld the Labor Arbiters ruling that petitioners, as
route helpers, performed work directly connected or necessary and
desirable in respondents ordinary business of manufacturing and
distributing its softdrink products. Thus, respondent failed to overcome
petitioners assertion that they were regular employees. As such, their
employment could only be terminated with just cause and after the
observance of the required due process. Thereafter, the subsequent
motion for reconsideration filed by respondent was further denied by the
NLRC on September 24, 2003.
On December 9, 2003, respondent filed a petition for certiorari 10 with the
CA alleging grave abuse of discretion on the part of the NLRC in finding
that petitioners were regular employees. In the meantime, petitioners filed
before the Labor Arbiter a Motion for Issuance of a Writ of
Execution11 dated December 15, 2003, to which respondent filed a
Manifestation and Motion with attached Opposition.12 On March 25, 2004,
the Labor Arbiter ordered that the Writ of Execution be issued, which was
affirmed by the NLRC on June 21, 2004. Consequently, respondent filed
another petition for Certiorari 13 on October 22, 2004, claiming that the
NLRC committed grave abuse of discretion in directing the execution of a
judgment, the propriety and validity of which was still under determination
of the appellate court.
In its Decision dated August 31, 2005, the CA consolidated respondents
two (2) petitions for certiorari and reversed the rulings of the NLRC and the
Labor Arbiter in the following wise:
That the respondents "performed duties which are necessary or desirable
in the usual trade or business of Coca-Cola," is of no moment. This is not
the only standard for determining the status of ones employment. Such
fact does not prevent them from being considered as fixed term employees
of Coca-Cola whose engagement was "fixed" for a specific period. The
respondents repeated hiring for various periods (ranging from more than
six months for private respondent Basan to eight years in the case of
private respondent Dizon) would not automatically categorize them as
REGULAR EMPLOYEES.
xxxx
It being supported by facts on record and there being no showing that the
employment terms were foisted on the employees through circumstances
vitiating or diminishing their consent, following Brent School, Inc. vs.
Zamora(G.R. No. 48494, Feb. 5, 1990), the respondents must be
considered as fixed term employees whose "seasonal employment" or
employment for a "period" have been "set down." After all, as conceded by
Petitioners essentially maintain that contrary to the findings of the CA, they
were continuously hired by respondent company to perform duties
necessary and desirable in the usual trade or business and are, therefore,
regular employees. They allege that if their services had really been
engaged for fixed specific periods, respondent should have at least
provided the contracts of employment evidencing the same.
77
For its part, respondent contends that the petition should be denied due
course for its verification and certification of non-forum shopping was
signed by only one of the petitioners. It alleges that even assuming the
validity of the same, it should still be dismissed for the appellate court
aptly found that petitioners were fixed-term employees who were hired
intermittently. Respondent also asserts that petitioners failed to completely
substantiate their claims, for during the hearing conducted before the
Labor Arbiter on March 11, 1998, the payslips presented by petitioners
merely established the following employment terms:
Name
of Length of Service
Petitioner
Dates
Between
November
And March 31, 1996
Dizon
4
2
9 months
Tumabiao
3 months
Basan
6.5
1 month
Donor
1 month
1 month
30,
months In
months In
In 1996
From
November
To January 31, 1997
months From
May
To
December
From
January
To January 31, 1997
1995
1993
1994
15,
15,
31,
15,
From
February
15,
To
March
15,
From
December
15,
To January 15, 1997
1996
1996
1996
1997
1996
1996
1996
Nicolas
8.5 months
Falguera
6 months
From
To 1997
1992
78
79
xxxx
Accordingly, and since the entire purpose behind the development of
legislation culminating in the present Article 280 of the Labor Code clearly
appears to have been, as already observed, to prevent circumvention of
the employee's right to be secure in his tenure, the clause in said article
indiscriminately and completely ruling out all written or oral agreements
conflicting with the concept of regular employment as defined therein
should be construed to refer to the substantive evil that the Code itself has
singled out: agreements entered into precisely to circumvent security of
tenure. It should have no application to instances where a fixed period of
employment was agreed upon knowingly and voluntarily by the parties,
without any force, duress or improper pressure being brought to bear upon
the employee and absent any other circumstances vitiating his consent, or
where it satisfactorily appears that the employer and employee dealt with
each other on more or less equal terms with no moral dominance whatever
being exercised by the former over the latter. Unless thus limited in its
purview, the law would be made to apply to purposes other than those
explicitly stated by its framers; it thus becomes pointless and arbitrary,
unjust in its effects and apt to lead to absurd and unintended
consequences.27
Thus, under the above Brent doctrine, while it was not expressly
mentioned in the Labor Code, this Court has recognized a fixed-term type
of employment embodied in a contract specifying that the services of the
employee shall be engaged only for a definite period, the termination of
which occurs upon the expiration of said period irrespective of the
existence of just cause and regardless of the activity the employee is
called upon to perform.28Considering, however, the possibility of abuse by
employers in the utilization of fixed-term employment contracts, this Court,
in Brent, laid down the following criteria to prevent the circumvention of
the employees security of tenure:
1) The fixed period of employment was knowingly and voluntarily
agreed upon by the parties without any force, duress, or improper
pressure being brought to bear upon the employee and absent any
other circumstances vitiating his consent; or
2) It satisfactorily appears that the employer and the employee
dealt with each other on more or less equal terms with no moral
dominance exercised by the former or the latter. 29 Unfortunately,
however, the records of this case is bereft of any proof which will
show that petitioners freely entered into agreements with
respondent to perform services for a specified length of time. In
fact, there is nothing in the records to show that there was any
agreement at all, the contracts of employment not having been
presented. While respondent company persistently asserted that
petitioners knowingly agreed upon a fixed period of employment
80
the date their salaries were withheld from them until their actual
reinstatement; (2) allowances and other benefits, or their monetary
equivalent, at the time of their dismissal; (3) attorney's fees equivalent to
ten percent ( 10%) of the monetary awards; and (4) interest at six percent
( 6%) per annum of the total monetary awards, computed from the finality
of this Decision until their full satisfaction. For this purpose, the records of
this case are hereby REMANDED to the Labor Arbiter for proper
computation of said awards, deducting amounts already received. Costs
against petitioner.
SO ORDERED.
81
Consequently, the SSC rendered its Resolution dated October 12, 2005,
thus:
Before this Court is a petition for review on certiorari dated September 28,
2007 of petitioner Hacienda Cataywa, Manuel Villanueva, et al.,
(petitioners) seeking to reverse and set aside the Resolutions, dated
October 17, 20061 and August 10, 2007,2 respectively, of the Court of
Appeals (CA) and the Resolution and Order, dated October 12, 2005 and
March 8, 2006, respectively, of the Social Security Commission, ordering
petitioners to pay jointly and severally all delinquent contributions, 3%
penalty per month of delayed payment and damages to respondent
Rosario
Lorezo.
The
antecedent
facts
follow:
ORDERED.7
82
2.
The
petition
is
partially
meritorious.
Petitioners argues that the CA has been too rigid in the application of the
rules of procedure in dismissing the appeal without evaluation of the
merits.
This Court has emphasized that procedural rules should be treated with
utmost respect and due regard, since they are designed to facilitate the
adjudication of cases to remedy the worsening problem of delay in the
resolution of rival claims and in the administration of justice. However, this
Court has recognized exceptions to the Rules, but only for the most
compelling reasons where stubborn obedience to the Rules would defeat
rather
than
serve
the
ends
of
justice.10
As in the case of Obut v. Court of Appeals,11 this Court held that "judicial
orders are issued to be obeyed, nonetheless a non-compliance is to be
dealt with as the circumstances attending the case may warrant. What
should guide judicial action is the principle that a party-litigant is to be
given the fullest opportunity to establish the merits of his complaint of
defense rather than for him to lose life, liberty, honor or property on
technicalities."12
When the CA dismisses a petition outright and the petitioner files a motion
for the reconsideration of such dismissal, appending thereto the requisite
pleadings, documents or order/resolution, this would constitute substantial
compliance with the Revised Rules of Court. 13 Thus, in the present case,
there was substantial compliance when in their Motion for Reconsideration,
they attached a secretary certificate giving Joemarie's authority to sign on
behalf of the corporation. Petitioners also included the necessary
attachment.14
At the outset, it is settled that this Court is not a trier of facts and will not
weigh evidence all over again. 15 However, considering the issues raised
which can be resolved on the basis of the pleadings and documents filed,
and the fact that respondent herself has asked this Court for early
resolution, this Court deems it more practical and in the greater interest of
justice not to remand the case to the CA but, instead, to resolve the
controversy
once
and
for
all.
Petitioners are of the opinion that the SSC committed reversible error in
making conclusions founded on speculations and surmises that respondent
worked from 1970 to February 25, 1990. Petitioners argue that the SSC did
not give credence nor weight at all to the existing SSS Form R-1A and farm
bookkeeper Wilfredo Ibalobor. Petitioners insist that after thirty long years,
all the records of the farm were already destroyed by termites and
elements, thus, they relied on the SSS Form R-1A as the only remaining
source of information available. Petitioners also alleged that respondent
was
a
very
casual
worker.
This
Court
disagrees.
83
passage of time, SSS Form R-1A is the only remaining source of information
available to prove when respondent started working for them. However,
such form merely reflected the time in which the petitioners reported the
respondent for coverage of the SSS benefit. They failed to substantiate
their claim that it was only in 1978 that respondent reported for work.
The records are bereft of any showing that Demetria Denaga and Susano
Jugue harbored any ill will against the petitioners prompting them to
execute false affidavit. There lies no reason for this Court not to afford full
faith and credit to their testimonies. Denaga, in her Joint Affidavit with
Jugue, stated that she and respondent started working in Hda. Cataywa in
1970 and like her, she was reported to the SSS on December 19, 1978. 18 It
was also revealed in the records that the SSC found that Denaga was
employed by Manuel Villanueva at Hda. Cataywa from 1970 to December
1987.19
Jurisprudence has identified the three types of employees mentioned in the
provision20 of the Labor Code: (1) regular employees or those who have
been engaged to perform activities that are usually necessary or desirable
in the usual business or trade of the employer; (2) project employees or
those whose employment has been fixed for a specific project or
undertaking, the completion or termination of which has been determined
at the time of their engagement, or those whose work or service is
seasonal in nature and is performed for the duration of the season; and (3)
casual employees or those who are neither regular nor project
employees.21
Farm workers generally fall under the definition of seasonal employees. 22 It
was also consistently held that seasonal employees may be considered as
regular employees when they are called to work from time to time. 23 They
are in regular employment because of the nature of the job, and not
because of the length of time they have worked. However, seasonal
workers who have worked for one season only may not be considered
regular
employees.24
The nature of the services performed and not the duration thereof, is
determinative of coverage under the law. 25 To be exempted on the basis of
casual employment, the services must not merely be irregular, temporary
or intermittent, but the same must not also be in connection with the
business or occupation of the employer. 26 Thus, it is erroneous for the
petitioners to conclude that the respondent was a very casual worker
simply because the SSS form revealed that she had 16 months of
contributions. It does not, in any way, prove that the respondent performed
a job which is not in connection with the business or occupation of the
employer
to
be
considered
as
casual
employee.
The test for regular employees to be considered as such has been
thoroughly explained in De Leon v. NLRC,27viz.:
A reading of the records would reveal that petitioners failed to dispute the
allegation that the respondent performed hacienda work, such as planting
sugarcane point, fertilizing, weeding, replanting dead sugarcane fields and
routine miscellaneous hacienda work. 29 They merely alleged that
respondent was a very casual worker because she only rendered work for
16 months.30 Thus, respondent is considered a regular seasonal worker and
not
a
casual
worker
as
the
petitioners
alleged.
Petitioners also assert that the sugarcane cultivation covers only a period
of six months, thus, disproving the allegation of the respondent that she
worked for 11 months a year for 25 years. This Court has classified farm
workers as regular seasonal employees who are called to work from time to
time and the nature of their relationship with the employer is such that
during the off season, they are temporarily laid off; but reemployed during
the summer season or when their services may be needed.31 Respondent,
therefore, as a farm worker is only a seasonal employee. Since petitioners
provided that the cultivation of sugarcane is only for six] months,
respondent cannot be considered as regular employee during the months
when
there
is
no
cultivation.
Based on the foregoing facts and evidence on record, petitioners are liable
for delinquent contributions. It being proven by sufficient evidence that
respondent started working for the hacienda in 1970, it follows that
petitioners are liable for deficiency in the SSS contributions.
The imposition upon and payment by the delinquent employer of the three
percent (3%) penalty for the late remittance of premium contributions is
mandatory and cannot be waived by the System. The law merely gives to
the Commission the power to prescribe the manner of paying the
premiums. Thus, the power to remit or condone the penalty for late
remittance of premium contributions is not embraced therein. 32 Petitioners
erred in alleging that the imposition of penalty is not proper.
84
appeared as employer. However, this does not prove, in any way, that the
corporation is used to defeat public convenience, justify wrong, protect
fraud, or defend crime, or when it is made as a shield to confuse the
legitimate issues, warranting that its separate and distinct personality be
set aside. Also, it was not alleged nor proven that Mancy and Sons
Enterprises, Inc. functions only for the benefit of Manuel Villanueva, thus,
one
cannot
be
an
alter
ego
of
the
other.
WHEREFORE, the petition for review on certiorari dated September 28,
2007 of petitioners Hda. Cataywa, Manuel Villanueva, et al. is
hereby DENIED. Consequently, the resolution by the Social Security
Commission
is
hereby AFFIRMED with MODIFICATIONS that
the
delinquent contributions should be computed as six months per year of
service, and the case against Manuel and Jose Marie Villanueva
be DISMISSED.
SO ORDERED
It was held in Rivera v. United Laboratories, Inc.34 that While a corporation may exist for any lawful purpose, the law will regard it
as an association of persons or, in case of two corporations, merge them
into one, when its corporate legal entity is used as a cloak for fraud or
illegality. This is the doctrine of piercing the veil of corporate fiction. The
doctrine applies only when such corporate fiction is used to defeat public
convenience, justify wrong, protect fraud, or defend crime, or when it is
made as a shield to confuse the legitimate issues, or where a corporation is
the mere alter ego or business conduit of a person, or where the
corporation is so organized and controlled and its affairs are so conducted
as to make it merely an instrumentality, agency, conduit or adjunct of
another corporation. To disregard the separate juridical personality of a
corporation, the wrongdoing must be established clearly and convincingly.
It cannot be presumed.35
This Court has cautioned against the inordinate application of this doctrine,
reiterating the basic rule that "the corporate veil may be pierced only if it
becomes a shield for fraud, illegality or inequity committed against a third
person.36
The Court has expressed the language of piercing doctrine when applied to
alter ego cases, as follows: Where the stock of a corporation is owned by
one person whereby the corporation functions only for the benefit of such
individual owner, the corporation and the individual should be deemed the
same.37
This Court agrees with the petitioners that there is no need to pierce the
corporate veil. Respondent failed to substantiate her claim that Mancy and
Sons Enterprises, Inc. and Manuel and Jose Marie Villanueva are one and
the same. She based her claim on the SSS form wherein Manuel Villanueva
85
The Labor Arbiter in his Decision16 dated July 26, 2005 [c]onfirm[ed] that
the correct retirement pay of Zenaida M. Paz [was] ?12,487.50. 17
The National Labor Relations Commission in its Decision 18 dated December
8, 2008 modified the Labor Arbiters Decision. It likewise denied
reconsideration. The Decisions dispositive portion reads:
WHEREFORE, premises considered, the decision of the labor arbiter is
herebyMODIFIED. Complainant Appellant Zenaida Paz[s] retirement pay
should be computed pursuant to RA 7641 and that all the months she was
engaged to work for respondent for the last twenty eight (28) years should
be added and divide[d] by six (for a fraction of six months is considered as
one year) to get the number of years [for] her retirement pay[.]
Complainant Teresa Lopez is hereby entitled to her separation pay
computed at one half month pay for every year of service, a fraction of six
months shall be considered as one year, plus backwages from the time she
was illegally dismissed up to the filing of her complaint.
The
NTRCI hired Zenaida Paz (Paz) sometime in 1974 as a seasonal sorter, paid
P185.00 daily. NTRCI regularly re-hired her every tobacco season since
then. She signed a seasonal job contract at the start of her employment
and a pro-forma application letter prepared by NTRCI in order to qualify for
the
next
season.5
On May 18, 2003,6 Paz was 63 years old when NTRCI informed her that she
was considered retired under company policy.7 A year later, NTRCI told her
she
would
receive
P12,000.00
as
retirement
pay. 8
rest
of
the
decision
stays.
SO ORDERED.19
The Court of Appeals in its Decision20 dated May 25, 2011 dismissed the
Petition and modified the National Labor Relations Commissions Decision
in that financial assistance is awarded to . . . Zenaida Paz in the amount of
P60,356.25:21
Paz, with two other complainants, filed a Complaint for illegal dismissal
against NTRCI on March 4, 2004.9 She amended her Complaint on April 27,
2004 into a Complaint for payment of retirement benefits, damages, and
attorneys fees10 as P12,000.00 seemed inadequate for her 29 years of
service.11 The Complaint impleaded NTRCIs Plant Manager, Angelo Ang, as
respondent.12 The Complaint was part of the consolidated Complaints of
17
NTRCI
workers.13
SO ORDERED.22
NTRCI raised the requirement of at least six months of service a year for
that year to be considered in the retirement pay computation. It claimed
that Paz only worked for at least six months in 1995, 1999, and 2000 out of
the 29 years she rendered service. Thus, Pazs retirement pay amounted
to P12,487.50 after multiplying her ?185.00 daily salary by 22 working
days
in
a
month,
for
three
years. 15
The Court of Appeals found that while applying the clear text of Article 287
resulted in the amount of P12,487.50 as retirement pay, this amount
[was] so meager that it could hardly support . . . Paz, now that she is weak
and old, unable to find employment.23 It discussed jurisprudence on
financial assistance and deemed it appropriate to apply the formula: Onehalf-month pay multiplied by 29 years of service divided by two yielded
P60,356.25
as
Pazs
retirement
pay. 24
86
Paz comes before this court seeking to reinstate the National Labor
Relations Commissions computation.25 NTRCI filed its Comment,26 and this
court
deemed
waived
the
filing
of
a
Reply. 27
Petitioner Paz contends that respondent NTRCI failed to prove the alleged
company policy on compulsory retirement for employees who reached 60
years of age or who rendered 30 years of service, whichever came first. 28
Consequently, Article 287, as amended by Republic Act No. 7641, 29applies
and entitles her to retirement pay . . . equivalent to [at least] one-half
month salary for every year of service, a fraction of at least six (6) months
being considered as one whole year. 30 She adds that she was then 63
years old, and while one may opt to retire at 60 years old, the compulsory
retirement age is 65 years old under Article 287, as amended. 31
Petitioner Paz then argues respondent NTRCIs misplaced reliance
on Philippine Tobacco Flue-Curing & Redrying Corp. v. National Labor
Relations
Commission32 as
that
case
involved
separation
pay
computation.33
Lastly, petitioner Paz contends lack of legal basis that an employee should
have at least worked for six (6) months for a particular season for that
season to be included in the computation of retirement pay[.] 34 She
submits that regular seasonal employees are still considered employees
during off-season, and length of service determination should be applied in
retirees
favor.35
Respondent NTRCI counters that in retirement pay computation this court
should consider its ruling inPhilippine Tobacco on computing separation
pay of seasonal employees. It submits that the proviso a fraction of at
least six (6) months being considered as one (1) whole year appears in
both Article 287 on retirement pay and Articles 283 and 284 on separation
pay.36
Respondent NTRCI argues that unlike regular employees, seasonal workers
like petitioner Paz can offer their services to other employers during offseason. Thus, the six-month rule avoids the situation where seasonal
workers receive retirement pay twice an even more favorable position
compared
with
regular
employees.37
Both parties appear to agree on petitioner Pazs entitlement to retirement
pay. The issue before this court involves its proper computation. We also
resolve
whether
there
was
illegal
dismissal.
We
affirm
Regular
the
Court
of
Appeals
seasonal
decision
with
modification.
employees
Article 28038 of the Labor Code and jurisprudence identified three types of
employees, namely: (1) regular employees or those who have been
87
Thus, the nature of ones employment does not depend solely on the will or
word of the employer. Nor on the procedure for hiring and the manner of
designating the employee, but on the nature of the activities to be
performed by the employee, considering the employer's nature of business
and
the
duration
and
scope
of
work
to
be
done.
In the case at bar, while it may appear that the work of petitioners is
seasonal, inasmuch as petitioners have served the company for
many years, some for over 20 years, performing services
necessary and indispensable to LUTORCOs business, serve as
badges of regular employment.
Moreover, the fact that
petitioners do not work continuously for one whole year but only
for the duration of the tobacco season does not detract from
considering them in regular employment since in a litany of cases this
Court has already settled that seasonal workers who are called to work
from time to time and are temporarily laid off during off-season are not
separated from service in said period, but are merely considered on leave
until
re-employed.
Private respondent's reliance on the case of Mercado v. NLRC is misplaced
considering that since in said case of Mercado, although the respondent
company therein consistently availed of the services of the petitioners
therein from year to year, it was clear that petitioners therein were not in
respondent company's regular employ. Petitioners therein performed
different phases of agricultural work in a given year. However, during that
period, they were free to contract their services to work for other farm
owners, as in fact they did. Thus, the Court ruled in that case that their
employment would naturally end upon the completion of each project or
phase of farm work for which they have been contracted. 47 (Emphasis
supplied, citations omitted)
The CA did not err when it ruled that Mercado v. NLRC was not applicable
to the case at bar. In the earlier case, the workers were required to
perform phases of agricultural work for a definite period of time, after
which their services would be available to any other farm owner. They
were not hired regularly and repeatedly for the same phase/s of
agricultural work, but on and off for any single phase thereof. On the other
hand, herein respondents, having performed the same tasks for
petitioners every season for several years, are considered the
latters regular employees for their respective tasks. Petitioners
eventual refusal to use their services even if they were ready, able and
willing to perform their usual duties whenever these were available and
hiring of other workers to perform the tasks originally assigned to
respondents amounted to illegal dismissal of the latter. 49 (Emphasis
supplied, citation omitted)
Illegal
dismissal
and
backwages
88
process
and
nominal
damages
The Labor Code requires employers to comply with both procedural and
substantive due process in dismissing employees. Agabon v. National
Labor Relations Commission69 discussed these rules and enumerated the
four possible situations considering these rules:
Dismissals based on just causes contemplate acts or omissions attributable
to the employee while dismissals based on authorized causes involve
grounds under the Labor Code which allow the employer to terminate
employees. A termination for an authorized cause requires payment of
separation pay. When the termination of employment is declared illegal,
reinstatement and full backwages are mandated under Article 279. If
reinstatement is no longer possible where the dismissal was unjust,
separation
pay
may
be
granted.
Procedurally, (1) if the dismissal is based on a just cause under Article 282,
the employer must give the employee two written notices and a hearing or
opportunity to be heard if requested by the employee before terminating
the employment: a notice specifying the grounds for which dismissal is
sought a hearing or an opportunity to be heard and after hearing or
opportunity to be heard, a notice of the decision to dismiss; and (2) if the
dismissal is based on authorized causes under Articles 283 and 284, the
employer must give the employee and the Department of Labor and
Employment written notices 30 days prior to the effectivity of his
separation.
From the foregoing rules four possible situations may be derived: (1) the
dismissal is for a just cause under Article 282 of the Labor Code, for an
authorized cause under Article 283, or for health reasons under Article 284,
and due process was observed; (2) the dismissal is without just or
authorized cause but due process was observed; (3) the dismissal is
without just or authorized cause and there was no due process; and (4) the
89
dismissal is for just or authorized cause but due process was not observed.
In the first situation, the dismissal is undoubtedly valid and the employer
will
not
suffer
any
liability.
In the second and third situations where the dismissals are illegal, Article
279 mandates that the employee is entitled to reinstatement without loss
of seniority rights and other privileges and full backwages, inclusive of
allowances, and other benefits or their monetary equivalent computed
from the time the compensation was not paid up to the time of actual
reinstatement.
In the fourth situation, the dismissal should be upheld. While the
procedural infirmity cannot be cured, it should not invalidate the dismissal.
However, the employer should be held liable for non-compliance with the
procedural requirements of due process.70 (Emphasis in the original)
Agabon focused on the fourth situation when dismissal was for just or
authorized cause, but due process was not observed.71 Agabon involved a
dismissal for just cause, and this court awarded P30,000.00 as nominal
damages for the employers non-compliance with statutory due
process.72 Jaka Food Processing Corporation v. Pacot73 involved a dismissal
for authorized cause, and this court awarded P50,000.00 as nominal
damages for the employers non-compliance with statutory due process. 74
The difference in amounts is based on the difference in dismissal ground. 75
Nevertheless, this court has sound discretion in determining the amount
based on the relevant circumstances.76 In De Jesus v. Aquino,77 this court
awarded P50,000.00 as nominal damages albeit the dismissal was for just
cause.78
Petitioner Pazs case does not fall under the fourth situation but under the
third situation on illegal dismissal for having no just or authorized cause
and
violation
of
due
process.
Respondent NTRCI had considered petitioner Paz retired at the age of 63
before she reached the compulsory age of 65. This does not fall under the
just causes for termination in Article 282 of the Labor Code, the authorized
causes for termination in Article 283, or disease as a ground for
termination
in
Article
284.
As regards due process, the Omnibus Rules Implementing the Labor Code
provides:
Section 2. Standard of due process: requirements of notice. In all cases of
termination of employment, the following standards of due process shall be
substantially
observed.
There was no showing that respondent NTRCI complied with these due
process requisites. Thus, consistent with jurisprudence, 80 petitioner Paz
should
be
awarded
P30,000.00
as
nominal
damages.
Retirement
pay
90
. . . . Finally, Manila Hotel Company v. CIR did not rule that seasonal
workers are considered at work during off-season with regard to the
computation of separation pay. Said case merely held that, in regard to
seasonal workers, the employer-employee relationship is not severed
during off-season but merely suspended.92 (Citations omitted)
Philippine Tobacco considered Articles 283 and 284 of the Labor Code on
separation pay, and these articles include the proviso a fraction of at least
six (6) months shall be considered one (1) whole year.
While the present case involves retirement pay and not separation pay,
Article 287 of the Labor Code on retirement pay similarly provides that a
fraction of at least six (6) months being considered as one whole year.
Thus, this courts reading of this proviso in the Labor Code in Philippine
Tobacco applies in this case. An employee must have rendered at least six
months in a year for said year to be considered in the computation.
Petitions for review pursuant to Rule 45 of the Rules of Court can raise only
questions of law.93 Generally, this court accords great respect for factual
findings by quasi-judicial bodies, even according such findings with finality
when
supported
by
substantial
evidence.94
The Court of Appeals found no positive proof o[n] the total number of
months [petitioner Paz] actually rendered work [for respondent NTRCI]. 95
On the other hand, both the Labor Arbiter and the Court of Appeals
established from the records that she rendered at least six months of
service
for
1995,
1999,
and
2000
only. 96
Based on these factual findings, retirement pay pursuant to Article 287 of
the Labor Code was correctly computed at P12,487.50 and was awarded to
petitioner
Paz.
Financial
assistance
In addition, this court agrees with the Court of Appeals award of financial
assistance in the amount of P60,356.25 97 by applying the following
formula: one-half-month pay98 multiplied by 29 years in service and then
divided
by
2.99
91
At most, the Petition alleges that [p]etitioner [was] regularly hired every
season by respondents, her employment periods ranging from three (3) to
seven (7) months.104 None of the lower courts, not even the National
Labor Relations Commission that proposed the formula, made a factual
determination on the total number of months petitioner Paz rendered
actual
service.
In any event, this court has awarded financial assistance as a measure of
social justice [in] exceptional circumstances, and as an equitable
concession.105
In Eastern Shipping Lines, Inc. v. Sedan,106 Sedan was granted equitable
assistance equal to one-half-month pay for each year of his 23 years of
service with no derogatory record.107 This court discussed jurisprudence on
the grant of financial assistance:
We are not unmindful of the rule that financial assistance is allowed only in
instances where the employee is validly dismissed for causes other than
serious misconduct or those reflecting on his moral character. Neither are
we unmindful of this Courts pronouncements in Arc-Men Food Industries
Corporation v. NLRC, and Lemery Savings and Loan Bank v. NLRC, where
the Court ruled that when there is no dismissal to speak of, an award of
financial
assistance
is
not
in
order.
But we must stress that this Court did allow, in several instances, the grant
of financial assistance. In the words of Justice Sabino de Leon, Jr., now
deceased, financial assistance may be allowed as a measure of social
justice and exceptional circumstances, and as an equitable concession.
The instant case equally calls for balancing the interests of the employer
with those of the worker, if only to approximate what Justice Laurel calls
justice
in
its
secular
sense.
In this instance, our attention has been called to the following
circumstances: that private respondent joined the company when he was a
young man of 25 years and stayed on until he was 48 years old; that he
had given to the company the best years of his youth, working on board
ship for almost 24 years; that in those years there was not a single report
of him transgressing any of the company rules and regulations; that he
applied for optional retirement under the companys non-contributory plan
when his daughter died and for his own health reasons; and that it would
appear that he had served the company well, since even the company said
that the reason it refused his application for optional retirement was that it
still needed his services; that he denies receiving the telegram asking him
to report back to work; but that considering his age and health, he
preferred to stay home rather than risk further working in a ship at sea.
In our view, with these special circumstances, we can call upon the same
social and compassionate justice cited in several cases allowing financial
assistance. These circumstances indubitably merit equitable concessions,
via the principle of compassionate justice for the working class. Thus,
we agree with the Court of Appeals to grant financial assistance to private
respondent.108
(Citations
omitted)
We agree with the Court of Appeals that petitioner Pazs circumstances
indubitably merit equitable concessions, via the principle of
compassionate
justice
for
the
working
class. 109
Petitioner Paz worked for respondent NTRCI for close to three decades. She
had no record of any malfeasance or violation of company rules in her long
years of service.110 Her advanced age has rendered her weak and lessened
her
employment
opportunities.
Eastern Shipping Lines awarded Sedan with financial assistance equal to
one-half-month pay for every year of service. Sedan was hired as a 3rd
92
marine engineer and oiler from 1973 until his last voyage in 1997. 111 On
the other hand, petitioner Paz was a seasonal employee who worked for
periods ranging from three to seven months a year. 112 This court thus finds
the following Court of Appeals formula for financial assistance as equitable:
one-half-month pay multiplied by 29 years in service and then divided by
2.
This court has discussed that labor law determinations are not
only secundum rationem but alsosecundum caritatem.113 The award of
P60,356.25 as financial assistance will serve its purpose in providing
petitioner Paz sustenance and comfort after her long years of service.
Finally, legal interest of 6% per annum shall be imposed on the award of
full backwages beginning May 18, 2003 when petitioner Paz was deemed
retired, until 2005 when she reached compulsory retirement age, in the
amount of P2,664.00114 Legal interest of 6% per annum shall also be
imposed on the award of retirement pay beginning 2005 until full
satisfaction.
WHEREFORE,
the
Court
of
Appeals
Decision
is AFFIRMED with MODIFICATION in that respondent Northern Tobacco
Redrying Co., Inc. is hereby ordered to pay petitioner Zenaida Paz the
following:
(1)
P22,200.00
as
full
backwages;ChanRoblesVirtualawlibrary
P12,487.50
P60,356.25
as
retirement
as
pay;ChanRoblesVirtualawlibrary
financial
assistance;
and
(5) P2,664.00 as legal interest for the award of full backwages, and legal
interest of 6% per annum for the award of retirement pay beginning 2005
until
full
satisfaction.
SO ORDERED
93
CRUZ, petitioner,
To: 3rd engineer Dante D. de la Cruz
CREWING,
INC.
and
ELITE
SHIPPING
DECISION
CORONA, J.:
This petition for review on certiorari 1 seeks to set aside the November 26,
2004 decision2 and March 9, 2006 resolution 3 of the Court of Appeals (CA)
in CA-G.R. SP No. 74097.
Respondent Elite Shipping A.S. hired petitioner Dante D. de la Cruz as third
engineer for the vessel M/S Arktis Morning through its local agency in the
Philippines, co-respondent Maersk Filipinas Crewing Inc. The contract of
employment was for a period of nine months, starting April 19, 1999, with
a monthly basic salary of US$1,004.00 plus other benefits.
Petitioner was deployed to Jebel Ali, United Arab Emirates and boarded M/S
Arktis Morning on May 14, 1999.
In a logbook entry dated June 18, 1999, chief engineer Normann Per
Nielsen expressed his dissatisfaction over petitioner's performance:
3rd Eng. Dante D. de la Cruz has[,] since he signed on[,] not been
able to live up to the company's SMS job describtion (sic) for
3rd Engineer[.] Today he has been informed that if he do[es] not
improve his Job/Working performance within [a] short time he will
be signed off according to CBA Article 1 (7).
Said Article 1 (7) of the collective bargaining agreement (CBA) between
respondent Elite Shipping A.S. and its employees reads:
(7) The first sixty (60) days of service is to be considered a
probationary period which entitles a shipowner or his
representative, i.e.[,] the master of the vessel[,] to terminate the
contract by giving fourteen (14) days of written notice.
This entry was followed by another one dated June 26, 1999 which was
similar in content.
94
case, the filing of the said pleading on the next working day is
deemed on time;
Whereas, the question has been raised if the period is
extended ipso jure to the next working day immediately following
where the last day of the period is a Saturday, Sunday or legal
holiday so that when a motion for extension of time is filed, the
period of extension is to be reckoned from the next working day
and not from the original expiration of the period.
NOW THEREFORE, the Court Resolves, for the guidance of the
Bench and the Bar, to declare that Section 1, Rule 22 speaks only
of "the last day of the period" so that when a party seeks an
extension and the same is granted, the due date ceases to be the
last day and hence, the provision no longer applies. Any
extension of time to file the required pleading should
therefore be counted from the expiration of the period
regardless of the fact that said due date is a Saturday,
Sunday or legal holiday. (emphasis supplied)
Section 1, Rule 22, as clarified by the circular, is clear. Should a party
desire to file any pleading, even a motion for extension of time to file a
pleading, and the last day falls on a Saturday, Sunday or a legal holiday, he
may do so on the next working day. This is what petitioner did in the case
at bar.
However, according to the same circular, the petition for review on
certiorari was indeed filed out of time. The provision states that in case a
motion for extension is granted, the due date for the extended period shall
be counted from the original due date, not from the next working day on
which the motion for extension was filed. In Luz v. National Amnesty
Commission,4 we had occasion to expound on the matter. In that case, we
held that the extension granted by the court should be tacked to the
original period and commences immediately after the expiration of such
period.
In the case at bar, although petitioner's filing of the motion for extension
was within the period provided by law, the filing of the petition itself was
not on time. Petitioner was granted an additional period of 30 days within
which to file the petition. Reckoned from the original period, he should
have filed it on May 8, 2006. Instead, he did so only on May 11, 2006, that
is, 3 days late.
xxx
Whereas, the aforecited provision [Section 1, Rule 22 of the Rules
of Court] applies in the matter of filing of pleadings in courts when
the due date falls on a Saturday, Sunday or legal holiday, in which
Nevertheless, we will gloss over this technicality and resolve the case on
its merits in the exercise of this Court's equity jurisdiction as we have done
in a number of cases.5
95
xxx
xxx
Furthermore, the notice must state with particularity the acts or omissions
for which his dismissal is being sought.15
Contrary to respondents' claim, the logbook entries did not substantially
comply with the first notice, or the written notice of charge(s). It did not
state the particular acts or omissions for which petitioner was charged. The
statement therein that petitioner had "not been able to live up to the
company's SMS job description for 3 rd Engineer" and that he had "been
informed that if he [does] not improve his job/working performance within
[a] short time he will have to be signed off according to CBA Article 1 (7)"
was couched in terms too general for legal comfort.
The CA held that the logbook entries were sufficient to enable petitioner to
explain his side or to contest the negative assessment of his performance
and were clearly intended to inform him to improve the same. We cannot
fathom how the CA arrived at such a conclusion. The entries did not
96
97
98
99
The primordial issue for the Courts resolution is whether or not the CA
correctly granted respondents petition for certiorari, thereby setting aside
the NLRCs decision holding that petitioners were regular employees and
reinstating the LA ruling that petitioners were merely project-based
employees, and thus, validly dismissed from service.
Contrary to the LAs finding, the NLRC found that petitioners could not be
properly characterized as project-based employees, ratiocinating that while
it was made known to petitioners that their employment would be coterminus to the Alltel Project, it was neither determined nor made known to
petitioners, at the time of hiring, when the said project would end, be
terminated, or be completed.32In this relation, the NLRC concluded that
inasmuch as petitioners had been engaged to perform activities which are
necessary or desirable in respondents usual business or trade of BPO,
petitioners should be deemed regular employees of Sykes Asia. 33 This
notwithstanding, and in view of the cessation of the Alltel Project, the NLRC
found petitioners employment with Sykes Asia to be redundant; hence,
declared that they were legally dismissed from service and were only
entitled
to
receive
their
respective
separation
pay. 34
In a Decision39 dated April 29, 2013, the CA annulled and set aside the
ruling of the NLRC, and accordingly, reinstated that of the LA. 40 It held that
a perusal of petitioners respective employment contracts readily shows
that they were hired exclusively for the Alltel Project and that it was
specifically stated therein that their employment would be projectbased.41 The CA further held that petitioners employment contracts need
not state an actual date as to when their employment would end, opining
that
it
is
enough
that
such
date
is
determinable. 42
Petitioners moved for reconsideration, 43 which was, however, denied in a
Resolution44 dated October 3, 2013, hence, this petition.
The Issue Before the Court
The
petition
is
without
merit.
100
nature
and
the
employment
is
for
the
duration
of
the
season.
As regards the second requisite, the CA correctly stressed that [t]he law
and jurisprudence dictate that the duration of the undertaking begins and
ends at determined or determinable times while clarifying that [t]he
phrase determinable times simply means capable of being determined or
fixed.51 In this case, Sykes Asia substantially complied with this requisite
when it expressly indicated in petitioners employment contracts that their
positions were co-terminus with the project. To the mind of the Court,
this caveat sufficiently apprised petitioners that their security of tenure
with Sykes Asia would only last as long as the Alltel Project was subsisting.
In other words, when the Alltel Project was terminated, petitioners no
longer had any project to work on, and hence, Sykes Asia may validly
terminate them from employment.
Further, the Court likewise notes the fact that Sykes Asia duly submitted an
Establishment Employment Report52 and an Establishment Termination
Report53 to the Department of Labor and Employment Makati-Pasay Field
Office regarding the cessation of the Alltel Project and the list of employees
that would be affected by such cessation. As correctly pointed out by the
CA, case law deems such submission as an indication that the employment
was indeed project-based.54
In sum, respondents have shown by substantial evidence that petitioners
were merely project-based employees, and as such, their services were
lawfully terminated upon the cessation of the Alltel Project.
WHEREFORE, the petition is DENIED. Accordingly, the Decision dated
April 29, 2013 and the Resolution dated October 3, 2013 of the Court of
Appeals in CA-G.R. SP No. 120433 are herebyAFFIRMED. SO ORDERED.
101
WILFREDO
ARO,
RONILO
TIROL,
JOSE
PACALDO, PRIMITIVO CASQUEJO and MARCIAL
ABGO,
Petitioners,
-
versus
the NLRC Arbitration Branch No. VII in Cebu City and docketed as RAB Case
No.
Present:
07-09-1222-97/12-1609-97. Thereafter,
Labor
Arbiter
Ernesto
F.
decision. The NLRC, in NLRC Case No. V-000399-98, affirmed the decision
March 7, 2012
of Labor Arbiter Carreon in its Decision dated January 12, 1999, with the
modification that private respondent pay backwages computed from the
x-----------------------------------------------------------------------------------------x
DECISION
filed a motion for reconsideration with the contention that, since it has
been found by the Labor Arbiter and affirmed in the assailed decision that
PERALTA, J.:
should be limited to the date of the completion of the project and not to
the finality of the decision. The NLRC, however, denied the motion ruling
that private respondent failed to establish the date of the completion of
the project.
and Resolution[2] dated July 27, 2006, of the Court of Appeals (CA) in CAG.R. CEB-SP No. 01012 which reversed the Decision and Resolution dated
June 25, 2004 and June 30, 2005, respectively, of the National Labor
Aggrieved, private respondent filed a Petition for Certiorari with the CA,
docketed as CA-G.R. SP No. UDK 3092 assailing the January 12, 1999
decision of the NLRC and the denial of its motion for reconsideration which
filed a motion for reconsideration, but the latter was also denied.
Several
employees
of
private
respondent
Benthel
Development
Thus, private respondent filed with this Court, docketed as G.R. No. 144433
a Petition for Review on Certiorari. In a Resolution dated September 20,
102
2000, this Court denied the petition for having been filed out of time and
project and not until the finality of the decision. Public respondent, in its
Decision dated June 25, 2004, affirmed the Order of Labor Arbiter Bantug,
but reduced the total amount to P4,073,858.00, inclusive of attorney's
The employees, including the petitioners, upon the finality of this Court's
resolution, filed a Motion for Execution before the Labor Arbiter of the
the June 25, 2004 decision which was denied by the public respondent, but
January 12, 1999 decision.Thereafter, the Labor Arbiter ordered for the
Afterwards, private respondent filed an appeal from the said Order with an
preliminary injunction with public respondent NLRC. The said appeal was
fees.
denied. The NLRC held that the appeal was premature, there having been
no computation yet made by the Labor Arbiter as to the exact amount to
As a recourse, private respondent filed a petition for certiorari with the CA,
promulgating
its
assailed
decision
and
denying
its
motion
for
setting aside the decision and resolution of the NLRC as to the award for
backwages and remanded the case to the same public respondent for the
issued an Order dated July 31, 2003 for the issuance of a writ of execution
only for the payment of the claims of the twenty-one (21) remaining
employees in the total amount of P4,383,225.00, which included attorney's
fees equivalent to ten (10%) percent of the sum received as settlement by
the fifteen (15) employees who had earlier settled with the private
respondent.
103
First of all, this Court has to address the nature of the petition filed by
petitioners. As pointed out by private respondent, and not disputed by
petitioners, the present petition was filed out of time. Petitioners received,
on August 4, 2006, a copy of the CA Resolution dated July 27, 2006. The
period within which to file a petition for review under Rule 45 is within
fifteen (15) days from notice of the judgment or final order or resolution
GROUND/ASSIGNMENT OF ERRORS
appealed from, or from the denial of the petitioners' motion for new trial or
case, not later than August 19, 2006. Under Rule 65, a petition
for certiorari may be filed not later than sixty (60) days from notice of the
judgment, order or resolution, or in this case, not later than October 3,
2006. However, the present petition is dated October 7, 2006 and as it
appears on the records, this Court received the said petition on October
17, 2006. Thus, on its face and in reality, the present petition was filed out
of time, whether it be under Rule 45 or Rule 65 of the Rules of
Court. Nevertheless, this Court did not dismiss the present petition and
required private respondent to file its Comment. Consequently, a Reply
from petitioners and eventually, both parties' respective memorandum
were filed. In view of that premise and in the interest of justice, this Court
In its Comment[5] dated January 24, 2007, private respondent stated the
following counter-arguments:
1. The issues presented in CA-G.R. SP No. UDK
3092 and SC G.R. No. 144433 are not the same issues
recently raised in the Petition for Certiorari before the
Court of Appeals.
2. There is no final and executory ruling that
herein petitioners were regular employees and not just
project employees.[6]
Resolution
dismissing
private
respondent's
petition
104
bind the Court when supported by substantial evidence. [7] Section 5, Rule
denied
2000. Not
contented, private respondent filed a petition with this Court, which the
latter denied, through its Second Division (G.R. No. 144433), in its
not a trier of facts, and this is strictly adhered to in labor cases. [8] We [this
Court] may take cognizance of and resolve factual issues, only when the
findings of fact and conclusions of law of the Labor Arbiter or the NLRC are
judgment.
inconsistent with those of the CA.[9] In the present case, the NLRC and the
by
the
CA
in
its
Resolution
dated
June
8,
Labor Arbiter and the NLRC. Basically, according to private respondent, the
Arbiter Ernesto Carreon in his Decision dated May 28, 1998, because they
CA merely sought to correct the NLRC's and the Labor Arbiter's one-sided
were hired for the construction of the Cordova Reef Village Resort in
Cordova, Cebu, which was later on affirmed by the NLRC in its January 12,
1999 decision. The only discrepancy is the Order of the NLRC that
further claims that the issues presented in their earlier petitions with the
CA and this Court (CA-G.R. SP No. UDK 3092 and SC G.R. No. 144433,
respectively)
petition
for certiorari later filed with the CA and the decision of which is now the
12, 1999 decision, the NLRC changed its findings by ruling that petitioners
and executory ruling that petitioners were regular and not just project
employees, hence, there was a need to file a petition with the CA.
until finality of the decision, citing that petitioners repeated rehiring over a
are
not
the
same
issues
raised
in
the
105
In Hanjin Heavy Industries and Construction Co. Ltd. v. Ibaez, [10] this Court
extensively discussed the above distinction, thus:
x x x [T]he principal test for determining whether particular
employees are properly characterized as "project
employees" as distinguished from "regular employees" is
whether or not the project employees were assigned to
carry out a "specific project or undertaking," the duration
and scope of which were specified at the time the
employees were engaged for that project.[11]
In a number of cases,[12] the Court has held that the length
of service or the re-hiring of construction workers on a
project-to-project basis does not confer upon them regular
employment status, since their re-hiring is only a natural
consequence of the fact that experienced construction
workers are preferred. Employees who are hired for
carrying out a separate job, distinct from the other
undertakings of the company, the scope and duration of
which has been determined and made known to the
employees at the time of the employment , are properly
treated as projectemployees and their services may be
lawfully terminated upon the completion of a project.
[13]
Should the terms of their employment fail to comply
with
this
standard,
considered project employees.
they
cannot
be
106
Applying the above disquisition, this Court agrees with the findings of the
CA that petitioners were project employees. It is not disputed that
petitioners were hired for the construction of the Cordova Reef Village
Resort in Cordova, Cebu. By the nature of the contract alone, it is clear
that petitioners' employment was to carry out a specific project.Hence, the
CA did not commit grave abuse of discretion when it affirmed the findings
of the Labor Arbiter. The CA correctly ruled:
A review of the facts and the evidence in this case readily
shows that a finding had been made by Labor Arbiter
Ernesto Carreon, in his decision dated May 28, 1998, that
complainants, including private respondents, are project
employees. They were hired for the construction of the
Cordova Reef Village Resort in Cordova, Cebu. We note
that no appeal had been made by the complainants,
including herein private respondents, from the said
finding. Thus, that private respondents are project
employees has already been effectively established.
Likewise, a review of the public respondent's January 12,
1999 decision shows that it affirmed the labor arbiter's
finding of the private respondents' being project
employees.
We therefore cannot fathom how the public respondent
could have ordered backwages up to the finality of its
decision when, as project employees, private respondents
are only entitled to payment of the same until the date of
the completion of the project. It is settled that, without a
valid cause, the employment of project employees cannot
be terminated prior to expiration.Otherwise, they shall be
entitled to reinstatement with full backwages. However, if
the project or work is completed during the pendency of
the ensuing suit for illegal dismissal, the employees shall
be entitled only to full backwages from the date of the
termination of their employment until the actual
completion of the work.
While it may be true that in the proceedings below the
date of completion of the project for which the private
respondents were hired had not been clearly established,
107
-versus-
their
ANDRES
G.
ARIOLA,
JESSIE
D.
ALCOVENDAS, JIMMY B. CALINAO AND
LEOPOLDO G. SEBULLEN,
Respondents.
Village Resort project had been completed in October 1996 and private
respondent herein had signified its willingness, by way of concession to
petitioners, to set the date of completion of the project as March 18, 1997;
hence, the latter date should be considered as the date of completion of
the project for purposes of computing the full backwages of petitioners.
x------------------------------------------------x
DECISION
PEREZ, J.:
Petition
for
Review dated
October
7,
2006,
of
petitioners Wilfredo Aro, Ronilo Tirol, Jose Pacaldo, Primitivo Casquejo and
for under Rule 65 of the 1997 Revised Rules of Civil Procedure by herein
2006 and Resolution dated July 27, 2006 of the Court of Appeals are
108
Highway Robbery Law of 1974 before the Office of the City Prosecutor of
Malabon City.[8]
[4]
Borja.
Clarido, one of its employees, that on 31 July 1998, he witnessed that while
on board the company vessel Analyn VIII, Lynvil employees, namely:
Andres G. Ariola (Ariola), the captain; Jessie D. Alcovendas (Alcovendas),
(Sebullen), bodegero, conspired with one another and stole eight (8) tubs
Analyn
fishes. These baeras were delivered to a consignee named SAS and Royale.
prejudice of Lynvil.
[11]
[5]
VIII
loaded
with
1,241 baeras of
different
kinds
of
viaje which terminates at the end of each trip. Ariola, Alcovendas and
office to inquire about their new job assignment but were told to wait for
Calinao were managerial field personnel while the rest of the crew were
field personnel.[6]
3. On 5 August 1998, only Alcovendas and Baez received a
4. By reason of the report and after initial investigation, Lynvils
happened on 31 July 1998. Upon being informed about this, Ariola, Calinao,
to explain within five (5) days why they should not be dismissed from
Nubla and Sebullen went to the Lynvil office. However, they were told that
[7]
the respondents
109
Backwages P234,000.00
(P6,500.00 x 36 = P234,000.00)
moral, exemplary damages and attorneys fees for their dismissal with bad
faith.[14]
from their oral demand of increase of salaries three months earlier and
their request that they should not be required to sign a blank payroll and
vouchers.[15]
Backwages P199,640.12
Separation Pay P58,149.00
13th Month Pay 2,473.12
Salary Differential P5,538.00
P265, 28.12
___________
TOTAL P 1, 341, 650.76
All other claims are dismissed for lack of merit. [17]
The Labor Arbiter found that there was no evidence showing that the
private respondents received the 41 baeras of pampano as alleged by De
2) Jessie Alcovendas
Backwages P195,328.00
(P5,148.00 x 36 = P195,328.00)
Separation Pay P44,304.00
13th Month Pay 5,538.00
Borja in his reply-affidavit; and that no proof was presented that the
8 baeras of pampano [and tangigue]
were
missing
at
the
place
of
destination.[18]
The Labor Arbiter disregarded the Resolution of Assistant City Prosecutor
Rosauro Silverio on the theft case. He reasoned out that the Labor Office is
3) Jimmy Calinao
dismissal of employees.[19]
110
actual quantities of the missing kinds of fish loaded to Analyn VIII. [25]It also
employment terminates upon the end of each trip does not make the
reversed the finding of the NLRC that the dismissed employees were
merely contractual employees and added that they were regular ones
did not negotiate on equal terms because of the moral dominance of the
employer.
business and trade of Lynvil. Finally, it ruled that the two-notice rule
[20]
The Labor Arbiter found that the procedural due process was not complied
with and that the mere notice given to the private respondents fell short of
[21]
Court by Lynvil:
process and that De Borja did not commit bad faith in dismissing the
employees so as to warrant his joint liability with Lynvil.
[22]
On 31 March 2004, the NLRC reversed and set aside the Decision
of the Labor Arbiter. The dispositive portion reads:
WHEREFORE, judgment
is
hereby
rendered REVERSING AND SETTING ASIDE the Decision
of the Labor Arbiter a quo and a new one entered
DISMISSING the present complaints for utter lack of merit;
II
THE HONORABLE COURT OF APPEALS ERRED IN RULING
THAT THE TERMINATION OF RESPONDENTS EMPLOYMENT
WAS NOT SUPPORTED BY SUBSTANTIAL EVIDENCE.
private respondents
except
Elorde
Baez
filed
III
Petition
IV
THE HONORABLE COURT OF APPEALS ERRED IN RULING
THAT THE RESPONDENTS WERE NOT ACCORDED
PROCEDURAL DUE PROCESS.
Decision of the Labor Arbiter except as to the award of attorneys fees. The
appellate court held that the allegation of theft did not warrant the
111
The contrariety of the findings of the Labor Arbiter and the NLRC
prevents reliance on the principle of special administrative expertise and
provides the reason for judicial review, at first instance by the appellate
court, and on final study through the present petition.
112
this trust is the essence of the offense for which an employee is penalized.
[36]
We agree with the ruling of the Labor Arbiter and Court of Appeals
found probable cause for theft the Labor Arbiter must follow the finding as
that the quantity of tubs expected to be received was the same as that
which was loaded. However, what is material is the kind of fish loaded and
required for purposes that differ from one and the other are likewise
different.
is
required
for
valid
dismissal. The
Distajo, a crew member of the Analyn VIII, stated in his letter addressed to
De Borja[37] dated 8 August 1998, that while the vessel was traversing San
Nicolas, Cavite, he saw a small boat approach them.When the boat was
Just
next to their vessel, Alcovendas went inside the stockroom while Sebullen
pushed an estimated four tubs of fish away from it. Ariola, on the other
hand, served as the lookout and negotiator of the transaction. Finally, Baez
Labor
and Calinao helped in putting the tubs in the small boat. He further added
that he received P800.00 as his share for the transaction. Romanito
Clarido, who was also on board the vessel, corroborated the narration of
Distajo on all accounts in his 25 August 1998 affidavit. [38] He added that
Alcovendas told him to keep silent about what happened on that
day. Sealing
affidavit
[39]
tight
the
credibility
of
the
narration
of
theft
is
the
113
tasks necessary and desirable in the usual trade and business of Lynvil.
Jurisprudence,[42] laid two conditions for the validity of a fixedcontract agreement between the employer and employee:
First, the fixed period of employment was
knowingly and voluntarily agreed upon by the
parties without any force, duress, or improper
pressure being brought to bear upon the employee
and absent any other circumstances vitiating his
consent; or
Second, it satisfactorily appears that the employer
and the employee dealt with each other on more or
less equal terms with no moral dominance
exercised by the former or the latter.[43]
Textually, the provision that: NA ako ay sumasang-ayon na maglingkod at
gumawa
ng
mga
gawain
sang-ayon
sa
patakarang
por
viaje
na
employment. In
the
context,
however,
of
the
facts
that: (1)
the
114
Upon the other hand, the requirement of hearing affords the employee an
The same set of circumstances indicate clearly enough that it was the need
for a continued source of income that forced the employees acceptance of
the por viaje provision.
Having found that respondents are regular employees who may be,
however, dismissed for cause as we have so found in this case, there is a
Given the fact that their dismissal was for just cause, we cannot
Rule XXIII, Book V of the Rules Implementing the Labor Code. It is required
the findings of the Labor Arbiter who with the expertise presided over the
that the employer furnish the employee with two written notices: (1) a
we grant the 13th month pay and salary differential of the dismissed
employees.
which to explain his side; and (2) a written notice of termination served on
the
employee
indicating
that
upon
due
consideration
of
all
the
As to the last issue, this Court has ruled that in labor cases, the
corporate directors and officers are solidarily liable with the corporation for
the termination of employment of employees done with malice or in bad
faith.[46] Indeed, moral damages are recoverable when the dismissal of an
employee is attended by bad faith or fraud or constitutes an act oppressive
to labor, or is done in a manner contrary to good morals, good customs or
public policy.
The
v. NLRC
[47]
that:
115
the
petition
is partially
GRANTED. The
10
116
117
for
regularization;
Alcaraz posits that, contrary to the Courts Decision, ones job description
cannot by and of itself be treated as a standard for regularization as a
standard denotes a measure of quantity or quality. By way of example,
Alcaraz cites the case of a probationary salesperson and asks how does
such employee achieve regular status if he does not know how much he
needs to sell to reach the same.
The argument is untenable.
First off, the Court must correct Alcarazs mistaken notion: it is not the
probationary employees job description but the adequate performance of
his duties and responsibilities which constitutes the inherent and implied
standard for regularization. To echo the fundamental point of the Decision,
118
119
120
versus -
The background facts are not disputed and are summarized below.
AMA
COMPUTER
CITY, INC. ,
COLLEGE-PARAAQUE
Promulgated:
Alba, Jr., were all engaged as Instructor 1. [5] The petitioners executed
individual Teachers Contracts for each of the trimesters that they were
engaged to teach, with the following common stipulation: [6]
Respondent.
1.
x-----------------------------------------------------------------------------------------x
DECISION
POSITION. The TEACHER has agreed to accept a nontenured appointment to work in the College of xxx
effective xxx to xxx or for the duration of the last
term that the TEACHER is given a teaching
load based on the assignment duly approved by the
DEAN/SAVP-COO. [Emphasis supplied]
BRION, J.:
For the school year 2000-2001, AMACC implemented new faculty
The petitioners Yolanda M. Mercado (Mercado), Charito S. De Leon
(De Leon), Diana R. Lachica (Lachica), Margarito M. Alba, Jr. (Alba, Jr.,), and
Felix A. Tonog (Tonog), all former faculty members of AMA Computer
College-Paraaque City, Inc. (AMACC) assail in this petition for review
on certiorari[1] the
Court
of
Appeals
(CA)
decision
of
November
29,2007[2] and its resolution of June 20, 2008 [3] that set aside the National
Labor Relations Commissions (NLRC) resolution dated July 18, 2005.[4]
potential,
The
high
academic
qualifications
performance standards
under
and
research
the new
screening
121
renewed for the following term because they failed to pass the
th
[9]
increase in salary. This move, according to AMACC, was justified since the
Grace Beronia, informing them that with the expiration of their contract to
teach,
their
contract
would
no
longer
be
and who among them did not comply with the other requirements of
regularization, promotions or increase in salary; and that the petitioners
Paper, the petitioners claimed that their dismissal was illegal because it
found no discrimination in the adjustments for the salary rate of the faculty
was made in retaliation for their complaint for monetary benefits and
that AMACC failed to give them adequate notice; hence, their dismissal
was ineffectual.
[12]
122
On appeal, the NLRC in a Resolution dated July 18, 2005 [17] denied
petitioners valid term of employment; (3) ruling that AMACC cannot apply
AMACCs appeal for lack of merit and affirmed in toto the LAs ruling. The
The CA Ruling
trimester basis), not Article 281 of the Labor Code (which prescribes a
probationary period of
six months) as
the LA
observation, the NLRC affirmed the LAs finding of illegal dismissal since the
AMACCs petition for certiorari and dismissed the petitioners complaint for
illegal dismissal.
be a full time teacher; (2) must have rendered three consecutive years of
employment contracts since the new guidelines were not imposed when
service; and (3) such service must be satisfactory before he or she can
the petitioners were first employed in 1998. According to the NLRC, the
The CA noted that the petitioners had not completed three (3)
period; their teaching stints only covered a period of two (2) years and
three (3) months when AMACC decided not to renew their contracts on
[18]
September 7, 2000.
elevated
the
case
to
the
CA via a
petition
the petitioners contracts. To the CA, the petitioners were not actually
for certiorari under Rule 65 of the Rules of Court. It charged that the NLRC
committed grave abuse of discretion in: (1) ruling that the petitioners were
renewed by AMACC because they failed to satisfy the schools standards for
the school year 2000-2001 that measured their fitness and aptitude to
123
1)
of any evidence of bad faith on AMACCs part, the court would not disturb
or nullify its discretion to set standards and to select for regularization only
2)
guidelines.
The petitioners submit that the CA should not have disturbed the
The CA disagreed with the NLRCs ruling that the new guidelines for
findings of the LA and the NLRC that they were illegally dismissed; instead,
the school year 2000-20001 could not be imposed on the petitioners and
the CA should have accorded great respect, if not finality, to the findings of
[22]
evaluation
academic
the Rules of Court, the CA does not assess and weigh the sufficiency of
evidence upon which the Labor Arbiter and the NLRC based their
standards for its faculty to ensure that they keep pace with the rapid
judgment for that of the Labor Arbiter and the NLRC who were the triers of
and
screening
of
its
faculty
members
for
tenured basis and for a fixed and predetermined term based on the
Labor Code which mandates a period of six (6) months as the maximum
Lachica and AMACC. The CA ruled that the non-renewal of the petitioners
contrary; that the CA should not have disturbed the LAs conclusion that
the AMACC failed to support its allegation that they did not qualify under
the new guidelines adopted for the school year 2000-2001; and that they
THE PETITION
124
In
their
Comment,[23] AMACC
notes
that
the
petitioners
raised
no
We
agree
with
the
petitioners
that,
as
rule
concluding that no actual dismissal transpired; it simply did not renew the
not assess and weigh each piece of evidence introduced in the case. The
AMACC also asserts that the petitioners knew very well that the
applicable standards would be revised and updated from time to time
given the nature of the teaching profession. The petitioners also knew at
the time of their engagement that they must comply with the schools
regularization policies as stated in the Faculty Manual. Specifically, they
must obtain a passing rating on the Performance Appraisal for
Teachers
(PAST)
the
primary
instrument
to
measure
the
we emphasized that:
As a general rule, in certiorari proceedings under
Rule 65 of the Rules of Court, the appellate court does not
assess and weigh the sufficiency of evidence upon which
the Labor Arbiter and the NLRC based their conclusion. The
query in this proceeding is limited to the determination of
whether or not the NLRC acted without or in excess of its
jurisdiction or with grave abuse of discretion in rendering
its decision. However, as an exception, the appellate
court may examine and measure the factual findings
of the NLRC if the same are not supported by
substantial evidence. The Court has not hesitated to
affirm the appellate courts reversals of the decisions
of labor tribunals if they are not supported by
substantial evidence.[Emphasis supplied]
125
purely by the Labor Code. The Labor Code is supplemented with respect
as follows:
[26]
The CA pointed this out in its decision (as the NLRC also did), and
we confirm the correctness of this conclusion. Other than on the period,
the following quoted portion of Article 281 of the Labor Code still fully
applies:
126
We have long settled the validity of a fixed-term contract in the case Brent
context of this case as Brent did not involve any probationary employment
employment under the terms of the Labor Code, then newly issued and
[28]
Last but not the least factor in the academic world, is that a school
enjoys academic freedom a guarantee that enjoys protection from the
Constitution no less. Section 5(2) Article XIV of the Constitution guarantees
all institutions of higher learning academic freedom. [30]
127
The
existence
of
the
term-to-term
contracts
covering
the
teachers and to determine whether or not these standards have been met
on probationary status not permanent or regular status from the time they
were employed on May 25, 1998 and until the expiration of their Teaching
[32]
two (2) years and three (3) months of service. This case, however,
brings to the fore the essential question of which, between the
two factors affecting employment, should prevail given AMACCs
position that the teachers contracts expired and it had the right
not to renew them. In other words, should the teachers probationary
decide for itself the terms and conditions for hiring its teacher, subject of
course to the overarching limitations under the Labor Code. Academic
freedom, too, is not the only legal basis for AMACCs issuance of screening
of
employment,
such
as
hiring,
the
freedom
to
prescribe
work
regulation
discipline, and dismissal and recall of workers. [34] Thus, AMACC has every
personnel before the full force of the security of tenure guarantee of the
Constitution comes into play.[37] Based on the standards set at the start of
contracts as its medium for hiring its teachers. It also acted within the
during the probationary period to reject hirees who fail to meet its own
nine trimesters.
assignments,
to be followed,
128
this regard, although the same attendance or compliance record may not
probationary period rules, the situation as in the present case may at first
the same just and authorizes causes for dismissal under the Labor Code
employment mode under Philippine law and jurisprudence. [45] The conflict,
however, is more apparent than real when the respective nature of fixed-
if the school does not have enough students for a given semester or
examined.
[41]
period agreed
upon
between
the
employer
and
the
employee;
period of knowing the company standards the new hires have to meet
employment exists only for the duration of the term and ends on its own
they achieve permanent status. Under the terms of the Labor Code, these
period of three years for those engaged in teaching jobs. Their similarity
the start of their probationary period, or at the very least under the
Understood
the
above
sense,
probationary
status
for
the essentially
character
appreciated. But
countervailing but equally protective rule that the probationary period can
furtherance, too, of the basic rule in employee dismissal that the employer
only last for a specific maximum period and under reasonable, well-laid
carries
rules ensure
the
this
probation,
same
any
protective
employer
management can
protective
process how these standards have been applied. This is effectively the
the burden of
of
in
character
on
the
rise
to
be
the
compliance with the limited security of tenure guarantee the law extends
of
to probationary employees.[44]
move based
gives
readily
probationary
129
Under the given facts where the school year is divided into
trimesters, the school apparently utilizes its fixed-term contracts as a
contracts are renewable unless the petitioners fail to pass the schools
standards.
relationship to any fixed term and to finish this relationship at the end of
used for the fixed term it offers, a replacement teacher, for example, may
that term. If we pierce the veil, so to speak, of the parties so-called fixed-
particular focus on the term and with every intent to end her teaching
relationship with the school upon expiration of this term.
says it did in the present case), these standards must not only be
reasonable but must have also been communicated to the teachers at the
start of the probationary period, or at the very least, at the start of the
course is to wreck the scheme that the Constitution and the Labor
expressly provided by the Labor Code, would serve as the just cause for
management.
fixed-term contract not specifically used for the fixed term it offers, Article
281 should assume primacy and the fixed-period character of the contract
Appraisal System
although the school also admits that these were standards under the
for Teachers
for
130
Appeals dated November 29, 2007 and its Resolution dated June 20, 2008 in
CA-G.R. SP No. 96599. The Labor Arbiters decision of March 15, 2002,
school year 2000-2001, glaring and very basic gaps in the schools
evidence still exist. The exact terms of the standards were never
Commission,
computation to take into account the date of the finality of this Decision.
stands
and
should
be
enforced
with
appropriate
re-
(b)
Given the period that has lapsed and the inevitable change of
circumstances that must have taken place in the interim in the academic
Decision.
The labor arbiter is hereby ORDERED to make another recomputation according to the above directives. No costs.
131
SO ORDERED.
132
April 2, 2014
UNIVERSIDAD
DE
STA.
vs.
MARVIN-JULIAN L. SAMBAJON, JR., Respondent.
ISABEL, Petitioner,
DECISION
VILLARAMA, JR., J.:
Before us is a petition for review on certiorari under Rule 45 urging this
Court to set aside the Decision 1 dated March 25, 2011 of the Court of
Appeals (CA) in CA-GR. SP Nos. 108103 and 108168 which affirmed with
modification the Decision2 dated August 1, 2008 of the National Labor
Relations Commission (NLRC). The NLRC affirmed the Decision 3 dated
August 22, 2006 of the Labor Arbiter in NLRC Sub-RAB V-05-04-00053-05)
declaring petitioner liable for illegal dismissal of respondent.
The Facts
Universidad de Sta. Isabel (petitioner) is a non-stock, non-profit religious
educational institution in Naga City. Petitioner hired Marvin-Julian L.
Sambajon, Jr. (respondent) as a full-time college faculty member with the
rank of Assistant Professor on probationary status, as evidenced by an
Appointment Contract4 dated November 1, 2002, effective November 1,
2002 up to March 30, 2003.
After the aforesaid contract expired, petitioner continued to give teaching
loads to respondent who remained a full-time faculty member of the
Department of Religious Education for the two semesters of school-year
(SY) 2003-2004 (June 1, 2003 to March 31, 2004); and two semesters of SY
2004-2005 (June 2004 to March 31, 2005).5
Sometime in June 2003, after respondent completed his course in Master of
Arts in Education, major in Guidance and Counseling, he submitted the
corresponding Special Order from the Commission on Higher Education
(CHED), together with his credentials for the said masters degree, to the
Human Resources Department of petitioner for the purpose of salary
adjustment/increase. Subsequently, respondents salary was increased, as
reflected in his pay slips starting October 1-15, 2004. 6 He was likewise reranked from Assistant Professor to Associate Professor.
In a letter dated October 15, 2004 addressed to the President of petitioner,
Sr. Ma. Asuncion G. Evidente, D.C., respondent vigorously argued that his
salary increase should be made effective as of June 2003 and demanded
the payment of his salary differential. The school administration thru Sr.
Purita Gatongay, D.C., replied by explaining its policy on re-ranking of
faculty members7, viz:
xxxx
Please be informed that teachers in the Universidad are not re-ranked
during their probationary period. The Faculty Manual as revised for school
year 2002-2003 provides (page 38) "Re-ranking is done every two years,
hence the personnel hold their present rank for two years. Those
undergoing probationary period and those on part-time basis of
employment are not covered by this provision." This provision is found also
in the 2000-2001 Operations Manual.
Your personnel file shows that you were hired as a probationary teacher in
the second semester of school year 2002-2003. By October 2004, you will
be completing four (4) semesters (two school years) of service. Even
permanent teachers are re-ranked only every two years, and you are not
even a permanent teacher. I am informed that you have been told several
times and made to read the Provision in the Faculty Manual by the
personnel office that you cannot be re-ranked because you are still a
probationary teacher.
x x x x8
Respondent insisted on his demand for retroactive pay. In a letter dated
January 10, 2005, Sr. Evidente reiterated the school policy on re-ranking of
teachers, viz:
xxx
Under the Faculty Manual a permanent teacher is not entitled to re-ranking
oftener than once every two years. From this it should be obvious that,
with all the more reason, a probationary teacher would not be entitled to
"evaluation," which could result in re-ranking or "adjustment in salary"
oftener than once every two years.
Since you are a probationary teacher, the University is under no obligation
to re-rank you or adjust your salary after what you refer to as "evaluation."
Nevertheless, considering that in October 2004 you were completing two
years of service, the University adjusted your salary in the light of the
CHED Special Order you submitted showing that you had obtained the
degree of Master of Arts in Education. Instead of being grateful for the
adjustment, you insist that the adjustment be made retroactive to June
2003. Simply stated, you want your salary adjusted after one semester of
probationary service. We do not think a probationary teacher has better
133
On April 14, 2005, respondent filed a complaint for illegal dismissal against
the petitioner.
In his Decision dated August 22, 2006, Labor Arbiter Jesus Orlando M.
Quinones ruled that there was no just or authorized cause in the
termination of respondents probationary employment. Consequently,
petitioner was found liable for illegal dismissal, thus:
Accordingly, and consistent with Article 279 of the Labor Code, respondent
school is hereby directed to pay complainant full backwages covering the
period/duration of the 1st semester of academic year 2005-2006.
Reinstatement being rendered moot by the expiration of the probationary
period, respondent school is directed to pay complainant separation pay in
lieu of reinstatement computed at one (1) months pay for every year of
service. An award of 10% attorneys fees in favor of complainant is also
held in order.
134
135
xxxx
(d) Subject to the provisions of Article 218 of the Labor Code, once the
appeal is perfected in accordance with these Rules, the Commission shall
limit itself to reviewing and deciding only the specific issues that were
elevated on appeal.
We have clarified that the clear import of the aforementioned procedural
rule is that the NLRC shall, in cases of perfected appeals, limit itself to
reviewing those issues which are raised on appeal. As a consequence
thereof, any other issues which were not included in the appeal shall
become final and executory.18
In this case, petitioner sets forth the following issues in its appeal
memorandum:
5.01
Probationary Employment Period
WHETHER THE MARVIN JULIAN L. SAMBAJON, JR. WAS ILLEGALLY DISMISSED
FROM THE UNIVERSIDAD DE STA. ISABEL.
5.02
WHETHER THE UNIVERSIDAD DE STA. ISABEL SHORTENED
PROBATIONARY PERIOD OF MARVIN JULIAN L. SAMBAJON.
THE
5.03
WHETHER RESPONDENTS-APPELLANTS ARE ENTITLED TO DAMAGES. 19
Specifically, petitioner sought the correct interpretation of the Manual of
Regulations for Private School Teachers and DOLE-DECS-CHED-TESDA
Order No. 01, series of 1996, insofar as the probationary period for
teachers.
It is well settled that the employer has the right or is at liberty to choose
who will be hired and who will be denied employment. In that sense, it is
within the exercise of the right to select his employees that the employer
may set or fix a probationary period within which the latter may test and
observe the conduct of the former before hiring him permanently. 22 The
law, however, regulates the exercise of this prerogative to fix the period of
probationary employment. While there is no statutory cap on the minimum
term of probation, the law sets a maximum "trial period" during which the
employer may test the fitness and efficiency of the employee. 23
136
which he signed was dated November 2002 for the period November 1,
2002 to March 30, 2003, as Assistant Professor 10 on probationary status.
x x x The second appointment-contract which Sambajon, Jr. executed was
dated February 26, 2004, for the period November 1, 2003 to March 31,
2004. x x x Compared with the first appointment-contract, it was not
indicated in the February 26, 2004 appointment-contract that Sambajon, Jr.
was hired on probationary status, which explains the NLRCs conclusion
that Sambajon, Jr. already attained permanent status. At this juncture, it is
worthy to emphasize that other than the period provided under Article 281
of the Labor Code, the following quoted portion of Article 281 of the Labor
Code still applies:
"ART. 281. PROBATIONARY EMPLOYMENT.
x x x x An employee who is allowed to work after a probationary period
shall be considered a regular employee."
Thus, We sustain the NLRCs conclusion that Sambajon, Jr. acquired
permanent status on the first day of the first semester of SY 2003-2004
when he was allowed to continue with his teaching stint after the
expiration of his first appointment-contract on March 30, 2003. 27
On record are five appointment contracts28 of respondent:
Date
Contract Period
November 1, 2002
Only the first and third contracts were signed by the respondent. However,
such lack of signature in the second contract appears not to be the crucial
element considered by the CA but the fact that the third contract dated
February 26, 2004, unlike the previous contracts, does not indicate the
nature of the appointment as probationary employment. According to the
CA, this implies, as concluded by the NLRC, that respondent was already a
regular employee.
We disagree.
The third appointment contract dated February 26, 2004 reads:
137
MR.
MARVIN
Religious Education Department
JULIAN
SAMBAJON
Received and Conforme:
Since it was explicitly provided in the above contract that unless renewed
in writing respondents appointment automatically expires at the end of
the stipulated period of employment, the CA erred in concluding that
simply because the word "probationary" no longer appears below the
designation (Full-Time Faculty Member), respondent had already become a
permanent employee. Noteworthy is respondents admission of being still
under probationary period in his January 12, 2005 letter to Sr. Evidente
reiterating his demand for salary differential, which letter was sent almost
one year after he signed the February 26, 2004 appointment contract, to
wit:
FULL
TIME
FACULTY
MEMBER
of the Religious Education Department from November 1, 2003 to March
31, 2004.
Unless otherwise renewed in writing, this designation automatically
terminates as of the date expiration above states without further notice.
As a member of the academic/clinical community, you are expected to live
by and give your full support to the promotion and attainment of the
Vision-Mission, goals and objectives, the rules and regulations, the Core
Values which the University professes to believe and live by.
Congratulations and keep your work full in the spirit of the Lord for the
Charity of Christ urges us to live life to the fullest.
God bless
In Christ,
Sr.
Ma.
USI President
Asuncion
G.
Evidente,
D.C.
Witness:
Sr.
HR Officer
Stella
O.
Real,
The problem is that your good office has never categorically resolved
whether or not probationary teachers can also be evaluated for salary
adjustment. Nevertheless, inferring from your statement that evaluation
precedes re-ranking and in fact is the basis for re-ranking, may I
categorically ask: does it really mean that since, it precedes re-ranking,
evaluation should not take place among probationary teachers for they can
not yet be re-ranked? If so, then how pitiful are we, probationary teachers
for our credentials are never evaluated since we cannot yet be re-ranked.
Oh my goodness! Can your good office not give me a clearer and more
convincing argument shedding light on this matter?30
Respondent nonetheless claims that subsequently, the probationary period
of three years under the regulations was shortened by petitioner as
relayed to him by Sr. Evidente herself. However, the latter, together with
Sr. Real, categorically denied having informed respondent that his
probationary period was abbreviated, allegedly the reason his salary
adjustment was not made retroactive. Apart from his bare assertion,
respondent has not adduced proof of any decision of the school
administration to shorten his probationary period.
D.C.
138
139
stating that November 2004 marks his second year of full-time teaching,
which means he had one more year to become a permanent employee. 36
The circumstance that respondents services were hired on semester basis
did not negate the applicable probationary period, which is three school
years or six consecutive semesters. In Magis Young Achievers Learning
Center37 the Court explained the three years probationary period rule in
this wise:
The common practice is for the employer and the teacher to enter into a
contract, effective for one school year. At the end of the school year, the
employer has the option not to renew the contract, particularly considering
the teachers performance. If the contract is not renewed, the employment
relationship terminates. If the contract is renewed, usually for another
school year, the probationary employment continues. Again, at the end of
that period, the parties may opt to renew or not to renew the contract. If
renewed, this second renewal of the contract for another school year would
then be the last year since it would be the third school year of
probationary employment. At the end of this third year, the employer may
now decide whether to extend a permanent appointment to the employee,
primarily on the basis of the employee having met the reasonable
standards of competence and efficiency set by the employer. For the entire
duration of this three-year period, the teacher remains under probation.
Upon the expiration of his contract of employment, being simply on
probation, he cannot automatically claim security of tenure and compel the
employer to renew his employment contract. It is when the yearly contract
is renewed for the third time that Section 93 of the Manual becomes
operative, and the teacher then is entitled to regular or permanent
employment status.38 (Emphasis supplied.)
Petitioner argues that respondents probationary period expires after each
semester he was contracted to teach and hence it was not obligated to
renew his services at the end of the fifth semester (March 2005) of his
probationary employment. It asserts that the practice of issuing
appointment contracts for every semester was legal and therefore
respondent was not terminated when petitioner did not renew his contract
for another semester as his probationary contract merely expired. Plainly,
petitioner considered the subject appointment contracts as fixed-term
contracts such that it can validly dismiss respondent at the end of each
semester for the reason that his contract had expired.
The Court finds no merit in petitioners interpretation of the Manual of
Regulations, supplemented by DOLE-DECS-CHED-TESDA Order No. 01,
series of 1996. As we made clear in the afore-cited case of Magis Young
Achievers Learning Center, the teacher remains under probation for the
entire duration of the three-year period. Subsequently, in the case of
Mercado v. AMA Computer College-Paraaque City, Inc. 39 the Court,
speaking through Justice Arturo D. Brion, recognized the right of
Probationary
Status
140
141
142
DECISION
PANGANIBAN, J.:
Generally, separation pay need not be paid to an employee who
voluntarily resigns. However, an employer who agrees to expend such
benefit as an incident of the resignation should not be allowed to renege in
the performance of such commitment.
The Case
Before us is a Petition for Review on Certiorari[1] under Rule 45 of the
Rules of Court, seeking to set aside the Decision [2] of the Court of Appeals
(CA), which affirmed the June 16, 1998 Decision of the National Labor
Relations Commission (NLRC).[3]
The documents forced upon the petitioner to sign were a resignation letter,
and a Release and Quit Claim. Said resignation letter read, thus:
To the Personal Manager
The Facts
143
144
145
To our mind, therefore, the foregoing coupled with the fact that there is
practically no evidence on record which shows that complainant was
pressured and made to sign a resignation letter and Release and Quitclaim
against his will [and] better judgment only shows that his claim of illegal
dismissal is unsubstantiated and is a mere afterthought.
Moreover, if indeed complainant was illegally dismissed, he should have
pursued his claim against the respondent corporation by immediately filing
a complaint for illegal dismissal. As it is, however, complainant filed a
complaint for separation pay against the respondent corporation only after
two (2) years from his alleged dismissal which complaint was amended for
the purpose of claiming illegal dismissal almost two (2) months thereafter.
facts and applicable law and doctrine. [22] An employee who resigns and
executes a quitclaim in favor of the employer isgenerally estopped from
filing any further money claims against the employer arising from the
employment.[23]
However, private respondent has not complied with its obligation to
give petitioners separation pay in the amount of P8,542.50. It was this
deliberate withholding of monetary benefits that necessitated the long,
litigious and lethargic proceedings in this case. Had private respondent
simply paid the measly amount of P8,452.50 as separation pay to
petitioner, this legal controversy could have been avoided and the court
dockets unclogged.
[20]
146
INTERTROD
MARITIME,
INC.
and
TROODOS
SHIPPING
CO., petitioners,
vs.
NATIONAL LABOR RELATIONS COMMISSION and ERNESTO DE LA
CRUZ, respondents.
Del Rosario & Del Rosario for petitioners.
PADILLA, J.:
This petition seeks the annulment and/or modification of the resolution * of
the First Division of the National Labor Relations Commission promulgated
on 11 December 1987 in NSB Case No. 3997-82 entitled "Ernesto de la
Cruz vs. Intertrod Maritime, Inc. and Troodos Shipping Company," which
reversed the decision of then POEA Administrator Patricia Sto. Tomas dated
20 December 1983.
On 10 May 1982, private respondent Ernesto de la Cruz signed a shipboard
employment contract with petitioner Troodos Shipping Company as
principal and petitioner Intertrod Maritime, Inc., as agent to serve as Third
Engineer on board the M/T "BREEDEN" for a period of twelve (12) months
with a basic monthly salary of US$950.00.1
Private respondent eventually boarded a sister vessel, M/T "AFAMIS" and
proceeded to work as the vessel's Third Engineer under the same terms
and conditions of his employment contract previously referred to. 2
On 26 August 1982, while the ship (M/T "Afamis") was at Port Pylos,
Greece, private respondent requested for relief, due to "personal
reason."3 The Master of the ship approved his request but informed private
respondent that repatriation expenses were for his account and that he
had to give thirty (30) days notice in view of the Clause 5 of the
employment contract so that a replacement for him (private respondent)
could be arranged.4
On 30 August 1982, while the vessel was at Port Said in Egypt and despite
the fact that it was only four (4) days after private respondent's request for
relief, the Master "signed him off" and paid him in cash all amounts due
him less the amount of US$780.00 for his repatriation expenses, as
evidenced by the wages account signed by the private respondent. 5
147
In its resolution, the NLRC held that the immediate approval of private
respondent's request for relief should have resulted in his disembarkation
in Port Pylos, Greece; that failure of the Master to allow disembarkation in
Greece nullified the request for relief and its approval, such that private
respondent's subsequent disembarkation in Egypt is no longer his doing
but rather an illegal dismissal on the part of the Master. 13 We cannot
support such a ruling for it fails to consider the clear import of the
provisions of the employment contract between petitioners and private
respondent.
Resignations, once accepted and being the sole act of the employee, may
not be withdrawn without the consent of the employer. In the instant case,
the Master had already accepted the resignation and, although the private
respondent was being required to serve the thirty (30) days notice
provided in the contract, his resignation was already approved. Private
respondent cannot claim that his resignation ceased to be effective
because he was not immediately discharged in Port Pylos, Greece, for he
could no longer unilaterally withdraw such resignation. When he later
signified his intention of continuing his work, it was already up to the
petitioners to accept his withdrawal of his resignation. The mere fact that
they did not accept such withdrawal did not constitute illegal dismissal for
acceptance of the withdrawal of the resignation was their (petitioners') sole
prerogative.
148
protecting the rights of the laborer, authorizes neither oppression nor selfdestruction of the employer."19
WHEREFORE, the petition is GRANTED. The questioned resolution of the
National Labor Relations Commission dated 11 December 1987 is hereby
REVERSED and SET ASIDE and the decision of then POEA Administrator
Patricia Sto. Tomas dated 20 December 1983 is REVIVED. No
pronouncement as to costs.
SO ORDERED.
149
up, but not Mercader who had since stopped reporting for work and thus
considered on AWOL. Continuing, Blue Angel alleged that when told that
they would be subjected to an investigation, Castillo, Ciriaco, and Garces
pleaded that they be allowed to resign instead. The three, so Blue Angel
claimed, then tendered their pro-forma letters of resignation followed by
handwritten resignation letters in the nature of quitclaims. To refute the
guards claims of non-payment of what was due them, Blue Angel
presented the payrolls and vouchers from July 1997 to April 1999 that
showed the four guards respective gross salaries and deductions.
In a Decision2 dated May 31, 2000, the labor arbiter, in part, found for the
guards, Blue Angel being ordered to immediately reinstate them with
backwages. The dispositive portion of the labor arbiters decision reads:
WHEREFORE, premises considered, judgment is hereby rendered ordering
Blue Angel Security and Manpower Services, Inc. to immediately reinstate
the complainants to their former positions pursuant to the ruling in the
Pioneer Texturing case that an order of reinstatement is self-executory
even pending appeal.
Respondent is hereby ordered to pay the backwages of the complainants
tentatively computed as follows:
Rommel Castillo --------
Php 82,971.00
Php 86,139.00
Php 86,337.00
Chesterfield Mercader
Php 82,971.00
SO ORDERED.
Dissatisfied, Blue Angel, on one hand, and Castillo, et al., on the other,
interposed separate appeals to the NLRC, the former faulting the labor
arbiter mainly for his finding that the four guards in question were illegally
dismissed. The guards, for their part, took exception to the arbiters
holding that some items of their money claim had already been paid.
By the Decision dated May 9, 2001, the NLRC affirmed with modification
that of the labor arbiter. The NLRC predicated its modificatory action on the
finding that Castillo, Ciriaco, and Garces were not terminated from the
service as they had indeed voluntarily resigned, and that only Mercader
was illegally dismissed. In net effect, the NLRC ruled that, of the four
complaining guards, only Mercader deserved to be reinstated with
150
II.
x x x IN NOT HOLDING THAT PRIVATE RESPONDENTS ARE NOT
ENTITLED TO THEIR CLAIMS FOR BACKWAGES OR ANY OTHER
MONETARY BENEFIT AS THEY HAVE ALREADY RECEIVED ALL THE
SALARIES AND BENEFITS THAT THEY ARE ENTITLED TO.
All other reliefs herein sought and prayed for are DENIED for lack of merit.
SO ORDERED.3
According to the NLRC, the two sets of letters of resignation, the pro-forma
resignations and the handwritten resignations, were never disputed.
Besides, the NLRC reasoned, the fact that the later resignation letters were
handwritten in Pilipino, a dialect known to them, militated against the
claims of Castillo, Ciriaco, and Garces that they were coerced and
pressured to writing the letters.
On certiorari before the CA, the CA first noted that Blue Angel did not
appeal the portion of the NLRC Decision affirming the labor arbiters ruling
that Mercader was illegally dismissed; hence, said portion of the decision
of the labor arbiter became final and binding on Blue Angel.
Now to the case of Castillo, Ciriaco, and Garces. In its February 26, 2003
Decision, the CA found incredulous the claim of Blue Angel that the guards
pleaded that they be allowed to resign and had voluntarily resigned after
they were told that an investigation would ensue. The CA concluded that
Blue Angel had illegally terminated Castillo, Ciriaco, and Garces. The fallo
of its Decision reads:
WHEREFORE, THE PETITION is hereby GRANTED. The decision of the
National Labor Relations Commission dated May 9, 2001 is ANNULLED AND
SET ASIDE except insofar as it sustained the labor arbiters ruling that
petitioner Chesterfield Mercader was illegally dismissed, with the result
that the decision of the labor arbiter dated May 31, 2000 is reinstated.
SO ORDERED.
Now before us, petitioner Blue Angel raises that the CA committed
palpable and reversible error of law in:
I.
151
pay equivalent to at least one month pay, or one month pay for every year
of service, whichever is higher, in addition to full backwages, inclusive of
allowances, and benefits or their monetary equivalent, computed from the
time the employees compensation was withheld up to the time of the
employees actual reinstatement.12
As to the other money claims of private respondents, the
vouchers,13 payrolls,14 and other documentary evidence15 show that the
other monetary benefits being claimed by private respondents have
already been duly paid.
WHEREFORE, the petition is DISMISSED for lack of merit. The Decision of
the CA in CA-G.R. SP No. 67478 reinstating the Decision dated May 31,
2000 of the labor arbiter is AFFIRMED with the MODIFICATION that
petitioner Blue Angel Security and Manpower Services, Inc. is ordered to
reinstate complainants Romel Castillo, Wilson Ciriaco, and Gary Garces to
their former positions without loss of seniority rights and other privileges
and with full backwages, inclusive of allowances and other benefits or their
monetary equivalent computed from the time their compensations were
withheld from them up to the time of their actual reinstatements. In the
event reinstatement is not feasible, they shall be paid separation pay in
the amount equivalent to at least one month pay or one month pay for
every year of service whichever is higher.
With respect to Chesterfield Mercader, the NLRC Decision dated May 9,
2001, affirming the labor arbiters Decision dated May 31, 2000 which
ordered petitioner to reinstate him to his former position and pay him
backwages of PhP 82,971, had become final on November 2, 2001, in the
absence of an appeal thereon to the CA.
SO ORDERED.
152
Reyes, JJ.
1990. Prior to her resignation in February 2000, she held the position of
Consignment Operations Manager with a salary of P27,000.00 a month.
[5]
She was tasked with the oversight, supervision and management of the
of Cinderella to obtain cash advances by charging the amount from the net
sales of Cinderellas suppliers/consignors. Mr. Miguel Tecson (AVP-Finance)
DECISION
approves the requests for cash advances, Mr. Arthur Coronel (AVPMerchandising) issues the memos instructing the accounting department
YNARES-SANTIAGO, J.:
to issue the corporate checks and finally, Ms. Theresa Santos (General
Manager) rediscounts them by issuing her personal checks. [7]
Resolution of the Court of Appeals dated August 18, 2006 [1] and December
13, 2006,[2] respectively, in CA-G.R. SP No. 88140 which reversed and set
dated June 21, 2004[3] and its Resolution dated October 14, 2004, [4] and
153
the resignation was fabricated and without evidentiary weight since it does
Petitioner alleged that Mr. Tecson demanded her resignation on
several occasions. On February 15, 2000, Mr. Tecson allegedly told her
MAG-RESIGN KANA AGAD KASI MAIIPIT KAMI, in the presence of Lizz
Villafuerte, the Accounting Manager.[9] As a result of this alleged force and
intimidation, petitioner tendered her resignation letter.
[10]
completed and before any formal investigation was initiated. She tendered
her resignation on February 7, 2000, then submitted another resignation
SO ORDERED.[13]
letter on February 15, 2000 where she confirmed the first resignation
letter. Respondent alleged that the complaint for constructive dismissal
was a mere afterthought demonstrated by the long delay of filing the
same.[11]
On
Decision
[12]
October
finding
21,
that
2003,
petitioner
the
was
Labor
Arbiter
constructively
rendered
and
illegally
dismissed. The Labor Arbiter ruled that Cinderella was not able to
controvert petitioners assertion that she was forced to resign; that the
resignation letter relied upon by respondent to show the voluntariness of
154
Appeals.
I.
On August 18, 2006, the Court of Appeals rendered its decision
finding that the totality of evidence on record showed that petitioner
II.
THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR
IN RULING THAT PETITIONER VOLUNTARILY RESIGNED
FROM PRIVATE RESPONDENT.[15]
to
petitioners
allegation
that
Mr.
Tecson
demanded
her
resignation. (4) The delay in filing the complaint for illegal dismissal cannot
be taken against her as the same was filed within the prescriptive period
SO ORDERED.
[14]
155
dismissed
relying
on
the
principle
of
finality
and
conclusiveness of the decisions of the labor tribunals. However, it is wellsettled that for want of substantial basis, in fact or in law, factual findings
of an administrative agency, such as the NLRC, cannot be given the stamp
of finality and conclusiveness normally accorded to it, as even decisions of
administrative agencies which are declared final by law are not exempt
from the judicial review when so warranted.[16]
Petitioner argues that the employer bears the burden of proof that
the
resignation is
of
coercion or
From
the
totality
of
evidence
on
record,
it
was
clearly
the
employee
is
compelled
by
personal
reason(s)
to
156
employer who bears the burden of proof that the resignation is voluntary
The resignation letter contained words of gratitude which can hardly come
her into resigning to exculpate other officers of the company from the
erroneous for the Labor Arbiter not to give evidentiary weight on the
anomaly; and that in the course of the internal investigation, Mr. Tecson
resignation letter on the ground that it was fabricated as it was not signed
by petitioner. A careful scrutiny of the said letter shows that it bears the
this caused confusion and fear which led to her uninformed decision of
We agree with the Court of Appeals that it was grave error on the
Subsequently, petitioner stopped reporting for work although she
part of the NLRC to rely on the allegation that Mr. Tecson threatened and
met with the officers of the corporation to settle her accountabilities but
never raised the alleged intimidation employed on her. Also, though the
serving, the allegation does not suffice to support the finding of force,
complaint was filed within the 4-year prescriptive period, its belated filing
Taken
together,
these
circumstances
are
substantial
proof
that
Bare allegations of constructive dismissal, when uncorroborated by
the evidence on record, cannot be given credence. [27] In St. Michael
Academy v. National Labor Relations Commission,[28] we ruled that mere
allegations of threat or force do not constitute substantial evidence to
157
dismissed by respondent.
as
form
of
harassment
against
petitioner. Said
SO ORDERED.
158
1,
General
x
24
(c),
Disturbing
x
Others,
which
x
states
that:
159
had been justified and valid upon taking into account that Northwest had
been engaged in the airline business in which a good public image had
been demanded, and in which flight attendants had been expected to
maintain an image of sweetness and amiability; that fighting among its
employees even in the form of heated arguments or discussions were very
contradictory to that expected image;4 and that it could validly dismiss its
employees like the respondent because it had been entitled to protect its
business interests by putting up an impeccable image to the public.
Ruling of the NLRC
Upon appeal, the NLRC reversed the decision of the Labor Arbiter, and
ruled in favor of Del Rosario, declaring that the incident between her and
Gamboa could not be considered as synonymous with fighting as the
activity prohibited by Northwests Rules of Conduct; that based on Blacks
Law Dictionary, fight referred to a hostile encounter, affray, or altercation;
a physical or verbal struggle for victory, pugilistic combat; that according
to Bouviers Law Dictionary, fighting did not necessarily imply that both
parties should exchange blows, for it was sufficient that they voluntarily
put their bodies in position with that intent; 5 and that the incident between
Del Rosario and Gamboa could not be held similar to the fight that
Northwest
penalized
under
its
Rules
of
Conduct.
WHEREFORE,
for
lack
of
merit,
the
instant
petition
is DISMISSED. Accordingly, the decision of the NLRC dated January 11,
2000, is hereby AFFIRMED with theMODIFICATION that in lieu of
reinstatement, petitioner is ordered to pay private respondent separation
pay equivalent to one month's salary for every year of service plus full
backwages without deduction or qualification, counted from the date of
dismissal until finality of this decision including other benefits to which she
is entitled under the law. Petitioner is likewise ordered to pay respondent
Del Rosario attorneys fees consisting of five (5%) per cent of the adjudged
relief.
SO ORDERED.
Issues
The issues are the following, namely: (1) Was Del Rosarios dismissal from
the service valid?; and (2) Were the monetary awards appropriate?
Ruling
The NLRC ordered the reinstatement of Del Rosario to her former position
without loss of seniority rights and with payment of backwages, per diems,
other lost income and benefits from June 19, 1998; as well as the payment
of attorneys fees equivalent to 10% of the monetary award.
Decision of the CA
The
decision
of
the
CA.
160
Art.
282. TERMINATION
BY
EMPLOYER
not just a merely verbal tussle but a physical combat between two
opposing parties, to wit:
Gross
and
habitual
neglect
by
the
employee
of
his
duties;
(c) Fraud or willful breach by the employee of the trust reposed in him by
his
employer
or
duly
authorized
representative;
(d) Commission of a crime or offense by the employee against the person
of his employer or any immediate member of his family or his duly
authorized
representative;
and
Well into their second bottle of gin, at about eleven o'clock that morning,
Fernando Aquino and Peregrino had a verbal tussle. Fernando Aquino
declared that he was going to run for councilor of Alcala, Pangasinan.
Peregrino countered by saying: If you will run for that post, cousin, I
will fight you. After a brief exchange of words, Fernando Aquino, laughing,
went to sit beside Abagat. As Aquino continued with his mirth, Abagat
stared
at
Peregrino
with
contempt.
xxx. A few minutes later, he heard a commotion in the plantation some two
hundred meters away. He claims to have seen several people fighting each
other with pieces of wood but did not go to the field to check what was
happening.13 (Italics supplied.)
161
162
163
since the grievance committee could not reach a decision, the case was
referred for voluntary arbitration.
Respondent then filed a case for illegal dismissal and the case was
assigned to VA Mayuga who found that respondent was illegally dismissed,
thus:
164
Appeals are conclusive on the parties and are not reviewable by the
Supreme Court. And they carry even more weight when the Court of
Appeals affirms the factual findings of a lower fact-finding body, in this
case the Voluntary Arbitrator.[15] Likewise, findings of fact of administrative
agencies and quasi-judicial bodies which have acquired expertise because
their jurisdiction is confined to specific matters, are generally accorded not
only great respect but even finality. They are binding upon this Court
unless there is a showing of grave abuse of discretion or where it is clearly
shown that they were arrived at arbitrarily or in utter disregard of the
evidence on record.[16]
Assuming arguendo that she did fail to report for work on April 1, 1996
and enroll during the first semester, the most respondent could be charged
with was simple misconduct. In both instances, there was evidence of
substantial compliance by respondent.
Her alleged failure to report for work exactly on April 1, 1996 is not
equivalent to failure to return for work, a sanctionable offense under the
Faculty Manual. As correctly pointed out by the VA, petitioner failed to
establish that there was a distinct and definite assignment that needed to
be done personally by respondent, and specifically on April 1, 1996, which
she failed to do on said date. Although we give credence to
petitioners argument that a private high school teacher still has work at
the end of the schoolyear to assist in the graduation preparations and in
the beginning of the school year to assist in the enrollment such tasks
cannot be considered a teachers main duties, the failure to perform which
would be tantamount to dereliction of duty or abandonment. Besides, there
is no disagreement that respondent reported for work on May 15, 1996 at
which time petitioner School could have asked her to assist in the
enrollment period. At most, respondent failed to help out during the
preparations for graduation and this, to us, was not a significant reason for
terminating or dismissing her from her job.
With regard to her alleged failure to enroll during the first semester,
although we agree with the President and Rector, Fr. Mendez, that
respondent should have first ascertained whether she was still eligible to
study at the PWU before applying for a study leave, [17] such lapse was more
of an error in judgment rather than an act of serious misconduct. If
respondent intended to use her study leave for other unauthorized
purposes, as petitioner would like us to believe, she would not have
enrolled at the Golden Gate Colleges during the second semester. Yet she
did, as borne out by the certification [18] prepared by the Registrar of Golden
Gate Colleges.
165
166
167
adherence to the same is called for and where the reputation of the school
is at stake. x x x.17
The LA further held that teachers and school employees, both in their
official and personal conduct, must display exemplary behavior and act in
a
manner
that
is
beyond
reproach.
The petitioner appealed to the NLRC, insisting that there was no valid
ground for the termination of her employment. She maintained that her
pregnancy out of wedlock cannot be considered as serious misconduct
under Article 282 of the Labor Code since the same was not of such a
grave and aggravated character. She asserted that SSCW did not present
any evidence to establish that her pregnancy out of wedlock indeed eroded
the moral principles that it teaches its students.18
The Ruling of the NLRC
On February 28, 2007, the NLRC issued a Resolution, 19 which affirmed the
LA Decision dated February 28, 2006. The NLRC pointed out that the
termination of the employment of the personnel of private schools is
governed by the 1992 MRPS; that Section 94(e) thereof cites disgraceful
or immoral conduct as a just cause for dismissal, in addition to the
grounds for termination of employment provided for under Article 282 of
the Labor Code. The NLRC held that the petitioners pregnancy out of
wedlock is a disgraceful or immoral conduct within the contemplation of
Section 94(e) of the 1992 MRPS and, thus, SSCW had a valid reason to
terminate
her
employment.
The petitioner sought reconsideration 20 of the Resolution dated February
28, 2007 but it was denied by the NLRC in its Resolution 21 dated May 21,
2007.
Further, a deep analysis of the facts would lead us to disagree with the
complainant that she was dismissed simply because she violate[d] a
Catholic [teaching]. It should not be taken in isolation but rather it should
be analyzed in the light of the surrounding circumstances as a whole. We
must also take into [consideration] the nature of her work and the nature
of her employer-school. For us, it is not just an ordinary violation. It was
committed by the complainant in an environment where her strict
Unperturbed, the petitioner filed a petition 22 for certiorari with the CA,
alleging that the NLRC gravely abused its discretion in ruling that there was
a valid ground for her dismissal. She maintained that pregnancy out of
wedlock cannot be considered as a disgraceful or immoral conduct; that
SSCW failed to prove that its students were indeed gravely scandalized by
her pregnancy out of wedlock. She likewise asserted that the NLRC erred in
applying Section 94(e) of the 1992 MRPS.
The Ruling of the CA
On September 24, 2008, the CA rendered the herein assailed
Decision,23 which denied the petition forcertiorari filed by the petitioner.
The CA held that it is the provisions of the 1992 MRPS and not the Labor
Code which governs the termination of employment of teaching and nonteaching personnel of private schools, explaining that:
168
Petitioner contends that her pre-marital sexual relations with her boyfriend
and her pregnancy prior to marriage was not disgraceful or immoral
conduct sufficient for her dismissal because she was not a member of the
schools faculty and there is no evidence that her pregnancy scandalized
the
school
community.
We are not persuaded. Petitioners pregnancy prior to marriage is
scandalous in itself given the work environment and social milieu she was
in. Respondent school for young ladies precisely seeks to prevent its
students from situations like this, inculcating in them strict moral values
and standards. Being part of the institution, petitioners private and public
life could not be separated. Her admitted pre-marital sexual relations was a
violation of private respondents prescribed standards of conduct that
views pre-marital sex as immoral because sex between a man and a
woman must only take place within the bounds of marriage.
Finally, petitioners dismissal is a valid exercise of the employer-schools
management prerogative to discipline and impose penalties on erring
employees pursuant to its policies, rules and regulations. x x x. 25 (Citations
omitted)
The petitioner moved for reconsideration26 but it was denied by the CA in
its
Resolution27 dated
March
2,
2009.
Court
does
not
agree.
The Court notes that the argument against the validity of the 1992 MRPS,
specifically Section 94 thereof, is raised by the petitioner for the first time
in the instant petition for review. Nowhere in the proceedings before the
LA, the NLRC or the CA did the petitioner assail the validity of the
provisions
of
the
1992
MRPS.
It is well established that issues raised for the first time on appeal and not
raised in the proceedings in the lower court are barred by estoppel. Points
of law, theories, issues, and arguments not brought to the attention of the
trial court ought not to be considered by a reviewing court, as these cannot
be raised for the first time on appeal. To consider the alleged facts and
arguments belatedly raised would amount to trampling on the basic
principles
of
fair
play,
justice,
and
due
process. 28
In any case, even if the Court were to disregard the petitioners belated
claim of the invalidity of the 1992 MRPS, the Court still finds the same
untenable.
169
The 1992 MRPS, the regulation in force at the time of the instant
controversy, was issued by the Secretary of Education pursuant to BP 232.
Section 7029 of BP 232 vests the Secretary of Education with the authority
to issue rules and regulations to implement the provisions of BP 232.
Concomitantly, Section 5730 specifically empowers the Department of
Education to promulgate rules and regulations necessary for the
administration, supervision and regulation of the educational system in
accordance
with
the
declared
policy
of
BP
232.
The qualifications of teaching and non-teaching personnel of private
schools, as well as the causes for the termination of their employment, are
an integral aspect of the educational system of private schools.
Indubitably, ensuring that the teaching and non-teaching personnel of
private schools are not only qualified, but competent and efficient as well
goes hand in hand with the declared objective of BP 232 establishing and
maintaining relevant quality education. 31 It is thus within the authority of
the Secretary of Education to issue a rule, which provides for the dismissal
of teaching and non-teaching personnel of private schools based on their
incompetence,
inefficiency,
or
some
other
disqualification.
Moreover, Section 69 of BP 232 specifically authorizes the Secretary of
Education to prescribe and impose such administrative sanction as he
may deem reasonable and appropriate in the implementing rules and
regulations for the [g]ross inefficiency of the teaching or non-teaching
personnel of private schools. 32 Accordingly, contrary to the petitioners
claim, the Court sees no reason to invalidate the provisions of the 1992
MRPS, specifically Section 94 thereof.
Second Issue: Validity of the Petitioners Dismissal
The validity of the petitioners dismissal hinges on the determination of
whether pregnancy out of wedlock by an employee of a catholic
educational institution is a cause for the termination of her employment.
In resolving the foregoing question, the Court will assess the matter from a
strictly neutral and secular point of view the relationship between SSCW
as employer and the petitioner as an employee, the causes provided for by
law in the termination of such relationship, and the evidence on record.
The ground cited for the petitioners dismissal, i.e., pre-marital sexual
relations and, consequently, pregnancy out of wedlock, will be assessed as
to whether the same constitutes a valid ground for dismissal pursuant to
Section 94(e) of the 1992 MRPS.
correctness, the Court has to view the CA decision in the same context that
the petition forcertiorari it ruled upon was presented to it; the Court has to
examine the CA decision from the prism of whether it correctly determined
the presence or absence of grave abuse of discretion in the NLRC decision
before it, not on the basis of whether the NLRC decision on the merits of
the case was correct.33
The phrase grave abuse of discretion is well-defined in the Courts
jurisprudence. It exists where an act of a court or tribunal is performed with
a capricious or whimsical exercise of judgment equivalent to lack of
jurisdiction.34 The determination of the presence or absence of grave abuse
of discretion does not include an inquiry into the correctness of the
evaluation of evidence, which was the basis of the labor agency in
reaching its conclusion.35
Nevertheless, while a certiorari proceeding does not strictly include an
inquiry as to the correctness of the evaluation of evidence (that was the
basis of the labor tribunals in determining their conclusion), the
incorrectness of its evidentiary evaluation should not result in negating the
requirement of substantial evidence. Indeed, when there is a showing
that the findings or conclusions, drawn from the same pieces of
evidence, were arrived at arbitrarily or in disregard of the
evidence on record, they may be reviewed by the courts. In
particular, the CA can grant the petition for certiorari if it finds that the
NLRC, in its assailed decision or resolution, made a factual finding not
supported by substantial evidence. A decision that is not supported by
substantial evidence is definitely a decision tainted with grave abuse of
discretion.36
The labor tribunals respective
conclusions that the petitioners pregnancy
is a disgraceful or immoral conduct
were arrived at arbitrarily.
The CA and the labor tribunals affirmed the validity of the petitioners
dismissal pursuant to Section 94(e) of the 1992 MRPS, which provides that:
Sec. 94. Causes of Terminating Employment In addition to the just causes
enumerated in the Labor Code, the employment of school personnel,
including faculty, may be terminated for any of the following causes:
xxxx
e. Disgraceful or immoral conduct;
xxxx
The labor tribunals concluded that the petitioners pregnancy out of
wedlock, per se, is disgraceful and immoral considering that she is
employed in a Catholic educational institution. In arriving at such
conclusion, the labor tribunals merely assessed the fact of the petitioners
170
171
case. Estrada and Radam also required the Court to delineate what
conducts are considered disgraceful and/or immoral as would constitute a
ground for dismissal. More importantly, as in the said administrative cases,
the instant case involves an employees security of tenure; this case
likewise concerns employment, which is not merely a specie of property
right, but also the means by which the employee and those who depend on
him
live.45
It bears stressing that the right of an employee to security of tenure is
protected by the Constitution. Perfunctorily, a regular employee may not
be dismissed unless for cause provided under the Labor Code and other
relevant laws, in this case, the 1992 MRPS. As stated above, when the law
refers to morality, it necessarily pertains to public and secular morality and
not religious morality. Thus, the proscription against disgraceful or
immoral conduct under Section 94(e) of the 1992 MRPS, which is made as
a cause for dismissal, must necessarily refer to public and secular morality.
Accordingly, in order for a conduct to be considered as disgraceful or
immoral, it must be detrimental (or dangerous) to those conditions upon
which depend the existence and progress of human society and not
because the conduct is proscribed by the beliefs of one religion or the
other.
Thus, in Santos v. NLRC,46 the Court upheld the dismissal of a teacher who
had an extra-marital affair with his co-teacher, who is likewise married, on
the ground of disgraceful and immoral conduct under Section 94(e) of the
1992 MRPS. The Court pointed out that extra-marital affair is considered as
a disgraceful and immoral conduct is an afront to the sanctity of marriage,
which is a basic institution of society, viz:
We cannot overemphasize that having an extra-marital affair is an afront to
the sanctity of marriage, which is a basic institution of society. Even our
Family Code provides that husband and wife must live together, observe
mutual love, respect and fidelity. This is rooted in the fact that both our
Constitution and our laws cherish the validity of marriage and unity of the
family. Our laws, in implementing this constitutional edict on marriage and
the family underscore their permanence, inviolability and solidarity. 47
The petitioners pregnancy out of
wedlock is not a disgraceful or immoral
conduct since she and the father of her
child have no impediment to marry each
other.
In stark contrast to Santos, the Court does not find any circumstance in
this case which would lead the Court to conclude that the petitioner
committed a disgraceful or immoral conduct. It bears stressing that the
petitioner and her boyfriend, at the time they conceived a child, had no
legal impediment to marry. Indeed, even prior to her dismissal, the
petitioner married her boyfriend, the father of her child. As the Court held
in Radam, there is no law which penalizes an unmarried mother by reason
172
173
Having established that the petitioner was illegally dismissed, the Court
now determines the reliefs that she is entitled to and their extent. Under
the law and prevailing jurisprudence, an illegally dismissed employee is
entitled to reinstatement as a matter of right.54 Aside from the instances
provided under Articles 28355 and 28456 of the Labor Code, separation pay
is, however, granted when reinstatement is no longer feasible because of
strained relations between the employer and the employee. In cases of
illegal dismissal, the accepted doctrine is that separation pay is available in
lieu of reinstatement when the latter recourse is no longer practical or in
the best interest of the parties.57
In Divine Word High School v. NLRC,58 the Court ordered the employer
Catholic school to pay the illegally dismissed high school teacher
separation pay in lieu of actual reinstatement since her continued presence
as a teacher in the school may well be met with antipathy and
antagonism by some sectors in the school community. 59
In view of the particular circumstances of this case, it would be more
prudent to direct SSCW to pay the petitioner separation pay in lieu of
actual reinstatement. The continued employment of the petitioner with
SSCW would only serve to intensify the atmosphere of antipathy and
antagonism between the parties. Consequently, the Court awards
separation pay to the petitioner equivalent to one (1) month pay for every
year of service, with a fraction of at least six (6) months considered as one
(1) whole year, from the time of her illegal dismissal up to the finality of
this judgment, as an alternative to reinstatement.
Also, employees who are illegally dismissed are entitled to full backwages,
inclusive of allowances and other benefits or their monetary equivalent,
computed from the time their actual compensation was withheld from
them up to the time of their actual reinstatement but if reinstatement is no
longer possible, the backwages shall be computed from the time of their
illegal termination up to the finality of the decision. 60 Accordingly, the
petitioner is entitled to an award of full backwages from the time she was
illegally dismissed up to the finality of this decision.
Nevertheless, the petitioner is not entitled to moral and exemplary
damages. A dismissed employee is entitled to moral damages when the
dismissal is attended by bad faith or fraud or constitutes an act oppressive
to labor, or is done in a manner contrary to good morals, good customs or
public policy. Exemplary damages may be awarded if the dismissal is
effected in a wanton, oppressive or malevolent manner. 61
Bad faith, under the law, does not simply connote bad judgment or
negligence. It imports a dishonest purpose or some moral obliquity and
conscious doing of a wrong, or a breach of a known duty through some
motive or interest or ill will that partakes of the nature of fraud. 62
It must be noted that the burden of proving bad faith rests on the one
alleging it63 since basic is the principle that good faith is presumed and he
174
who alleges bad faith has the duty to prove the same. 64Allegations of bad
faith and fraud must be proved by clear and convincing evidence.65
The records of this case are bereft of any clear and convincing evidence
showing that the respondents acted in bad faith or in a wanton or
fraudulent manner in dismissing the petitioner. That the petitioner was
illegally dismissed is insufficient to prove bad faith. A dismissal may be
contrary to law but by itself alone, it does not establish bad faith to entitle
the dismissed employee to moral damages. The award of moral and
exemplary damages cannot be justified solely upon the premise that the
employer dismissed his employee without cause. 66
However, the petitioner is entitled to attorneys fees in the amount of 10%
of the total monetary award pursuant to Article 11167 of the Labor Code. It
is settled that where an employee was forced to litigate and, thus, incur
expenses to protect his rights and interest, the award of attorneys fees is
legally and morally justifiable.68
Finally, legal interest shall be imposed on the monetary awards herein
granted at the rate of six percent (6%) per annum from the finality of this
judgment until fully paid.69
WHEREFORE, in consideration of the foregoing disquisitions, the petition
is GRANTED. The Decision dated September 24, 2008 and Resolution
dated March 2, 2009 of the Court of Appeals in CA-G.R. SP No. 100188 are
hereby REVERSED and SET ASIDE.
The respondent, St. Scholasticas College Westgrove, is hereby declared
guilty of illegal dismissal and is hereby ORDERED to pay the petitioner,
Cheryll Santos Leus, the following: (a) separation pay in lieu of actual
reinstatement equivalent to one (1) month pay for every year of service,
with a fraction of at least six (6) months considered as one (1) whole year
from the time of her dismissal up to the finality of this Decision; (b) full
backwages from the time of her illegal dismissal up to the finality of this
Decision; and (c) attorneys fees equivalent to ten percent (10%) of the
total monetary award. The monetary awards herein granted shall earn
legal interest at the rate of six percent (6%) per annum from the date of
the finality of this Decision until fully paid. The case is REMANDED to the
Labor Arbiter for the computation of petitioners monetary awards.
SO ORDERED.
175
connection
The company and Kurangil denied liability. They maintained that the
company has developed a world-renowned reputation for unsurpassed
customer service and quality in its line of business. They averred that
during the Christmas Party on December 18, 2010, Benitez berated and
maligned Kurangil by throwing foul and offensive words at him, such as
"putang ina mo ka VK, gago ka!" Benitez's tirade, they added, included the
company and it officers. Moreover, the incident happened in front of the
company's employees, their families, as well as company clients and
guests.
DECISION
BRION, J.:
We resolve the present petition for review on certiorari1 which seeks to
annul the November 7, 2012 decision 2 and July 10, 2013 resolution 3 of the
Court of Appeals in CA-G.R. SP No. 126213.
The Antecedents
On February 8, 2011, petitioners Roque V. Benitez (Benitez) and Santa Fe
Labor Union (union) filed a complaint for unfair labor practice and illegal
dismissal, with money claims,4 against respondents Santa Fe Moving and
Relocation Services (company) and its Managing Director, Vedit Kurangil
(Kurangil), an Australian citizen. The company is engaged in providing
relocation and moving services, including visa, immigration and real estate
services. Benitez (the union's Vice-President at the time), was its former
packing and moving operator (crew leader) since June 2001.5
Benitez alleged that on December 20, 2010, the company served him a
memorandum6 advising him not to report for work effective immediately,
thereby terminating his employment, supposedly on grounds of serious
misconduct or willful disobedience. He allegedly uttered abusive words
against Kurangil during the company's Christmas Party on December 18,
2010. He bewailed that he was not given the opportunity to defend
himself.
Benitez claimed that during the party, he noticed that the raffle committee
members were putting back the names of those who were already drawn,
giving them more chances of winning. He appealed to the committee to
put a stop to what they were doing, but they replied they would not "in the
spirit of Christmas." He denied having verbally abused Kurangil. He
presented the affidavits of co-employees Jhun Bulan, Romualdo Elib,
Carlos Morata and Raul Ramirez,7 attesting that Benitez, who was with
them at one table, did not commit the offense which led to his dismissal.
Benitez argued that his dismissal constituted an unfair labor practice as he
was a union officer and that it was undertaken to derail the conclusion of a
collective bargaining agreement with the company. He further argued that
the penalty of dismissal is disproportionate to his alleged offense,
considering that it was committed during a casual gathering and had no
to
his
work.
The company confirmed Benitez's claim that the incident involved the
conduct of the Christmas raffle. However, they differed on what triggered
his unruly behavior. It alleged that while the raffle was going on, Benitez
climbed up the stage and questioned the management's decision to allow
contractual employees to join the raffle. This resulted in only 80% of the
employees winning raffle prizes. Benitez then started hurling invectives
and foul language while still on stage, mostly directed at Kurangil.
The company further alleged that even when Benitez stormed out of the
stage, he kept on berating Kurangil, such that people he passed by
overheard him cursing Kurangil and the company and that he even
attempted to a throw a beer bottle at Kurangil, but he was restrained by
other
employees.
The
respondents
presented
in
evidence
the
affidavits
of
Kurangil,8 Reynaldo Delavin (Delavin),9 a company driver, and Diana Claros
Urmeneta10 (Urmeneta),11 a guest at the party. Their statements were
corroborated by the depositions 12 of company employees Jim Robert Afos
(Afos) and Marciano Atienza, Jr. (Atienza). The two disputed the
statements13 of Bulan, Elib, Morata and Ramirez witnesses for Benitez
that they were seated together with Benitez at one table and that he
caused no disturbance during the Christmas Party. Afos and Atienza stated
that they were the ones who were seated with Benitez, not Bulan, Elib,
Morata and Ramirez who were at a separate table with another group of
employees.
Afos and Atienza added that Benitez's tirade started when the raffle for the
grand prize was being conducted. All of a sudden, Benitez, who had not yet
won a prize at that time, stood up and proceeded to the stage, fuming mad
and
complaining
about
the
conduct
of
the
raffle. 14
The company required Benitez to explain in writing why he should not be
disciplined for serious misconduct and willful disobedience of its lawful
orders in connection with the incident. Benitez failed to comply and neither
did
he
show
remorse
for
what
he
did.
176
expenses. They submit in the main that the CA committed grave and
palpable error in misappreciating the facts and applicable jurisprudence in
this
case,
especially
the Samson
v.
NLRC24 ruling.
They contend that contrary to the appellate court's opinion, Benitez was
not liable for serious misconduct. They insist that Benitez did not malign
Kurangil, during the Christmas Party and that if he indeed became unruly
on that day, the company guards should have restrained him and made a
report about it, but there was no such intervention from the guards.
At any rate, they argue, Benitez should not have been dismissed for the
serious misconduct he allegedly committed since it was not in connection
with his work as moving and relocation operator. Moreover, for misconduct
to be serious, it must be of such a grave and aggravated character and not
merely trivial and unimportant as the Court declared in Samson which,
they claim, has factual similarities with the present case.
The Respondents' Case
Benitez and the union appealed, reiterating that his dismissal is illegal.
Moreover, they claimed, he was denied due process as he was not given
the
opportunity
to
explain
his
side.
The National Labor Relations Commission (NLRC) dismissed the appeal,
likewise for lack of merit, in its decision 18 of March 15, 2012. It sustained LA
Franco's finding that Benitez was validly dismissed for serious misconduct.
However, it noted "that the respondents failed to comply with the twonotice requirement as mandated by the Labor Code in validly dismissing an
employee."19 Accordingly, it affirmed LA Franco's ruling with modification
by awarding Benitez nominal damages of P50,000.00 for the violation of
his
right
to
procedural
due
process.
Benitez and the union moved for reconsideration, to no avail. The NLRC
denied the motion,20prompting them to file a petition for certiorari21 with
the CA.
In their Comment (on the Petition), 25 the respondents pray that the petition
be dismissed and the assailed CA rulings modified through a deletion of the
award of nominal damages to Benitez and the reinstatement of LA Franco's
September 14, 2011 decision. In the alternative, they ask that the nominal
damages
award
be
tempered.
They argue that the petitioners have not made out a case showing that
there are special and compelling reasons requiring the exercise by this
Court of its discretionary power of judicial review. They submit that the
petition virtually raises the same arguments that had already been duly
resolved, based on evidence supporting Benitez's dismissal for cause.
Thus, the petition should be rejected outright for it raises only questions of
facts and not of law.
The Court's Ruling
The CA Decision
Are the questions raised by the petitioners factual in nature, or are they of
law? The respondents contend that they are questions of fact and are
therefore not allowed in a petition for review oncertiorari under Rule 45,
Section 1 of the Rules of Court. Thus, they ask for an outright dismissal of
the petition as the Court is not a trier of facts.26
The Petition
Benitez and the union now ask the Court to reverse his dismissal and order
his reinstatement with full backwages, grant his money claims, award him
moral and exemplary damages, attorney's fees, as well as litigation
177
Again, we find this argument unpersuasive. There was no need for the
guards to intervene because Benitez was restrained by people near the
stage and who escorted him outside the premises where the party was
going on as attested to by Kurangil himself,37 as well as by Afos and
Atienza.38
xxxx
1. On or about 17 December 1993, during the Sales and Marketing
Christmas gathering, you made utterances of obscene, insulting,
and offensive words, referring to or directed against SPC's
Management Committee, in the presence of several co-employees.
2. On that same occasion, and again in the presence of several coemployees,you uttered obscene, insulting and offensive words,
and made malicious and lewd gestures, all of which referred to or
were directed against Mr. Epitacio D. Titong, Jr., President and
General
Manager
of
SPC.
3. Also on that occasion, you repeated your malicious utterances
and threatened to disrupt or otherwise create violence during
SPC's forthcoming National Sales Conference, and enjoined your
co- employees not to prepare for the said conference.
4. Subsequently, on or about 3 January 1994, you repeated your
threats to some co-employees, advising them to watch out for
some disruptive actions to happen during the National Sales
Conference. (Emphasis ours.)
xxxx
178
and disrespectful behavior, in utter disregard of the time and place of its
occurrence, had very much to do with his work. He set a bad example as a
union officer and as a crew leader of a vital division of the company. His
actuations during the company's Christmas Party on December 18, 2010,
to our mind, could have had negative repercussions for his employer had
he been allowed to stay on the job. His standing before those clients who
witnessed the incident and those who would hear of it would surely be
diminished, to the detriment of the company.
Finally, we agree with the NLRC ruling that the company failed to observe
the two-notice requirement in employee dismissals as Benitez was
dismissed on the same day that the memorandum was served on him. The
verbal directive for him to explain why he should not be dismissed,
assuming that there was indeed such a directive, clearly was not in
compliance with the law. Nonetheless, considering the gravity of Benitez's
offense, we deem it reasonable to award him P30,000.00 in nominal
damages for violation of his right to procedural due process.
WHEREFORE, premises considered, the petition is DISMISSED for lack of
merit. The assailed decision and resolution of the Court of Appeals
are AFFIRMED, with modification. The award of nominal damages to
Benitez is reduced from P50,000.00 to P30,000.00. The complaint is
DISMISSED.
SO ORDERED.
G.R. No. 208908, March 11, 2015
THE COFFEE BEAN AND TEA LEAF PHILIPPINES, INC. AND WALDEN
CHU, Petitioners, v. ROLLY P. ARENAS, Respondent.
DECISION
BRION, J.:
We resolve in this petition for review on certiorari1 the challenge to the
Court of Appeals (CA) decision 2 dated March 26, 2013 and
resolution3 dated August 30, 2013 in CA-G.R. SP No. 117822. These
assailed CA rulings affirmed the National Labor Relations Commissions
(NLRC) decision4 dated August 13, 2010, which also affirmed the Labor
Arbiters (LA) February 28, 2010 decision.
The Antecedent Facts
On April 1, 2008, the Coffee Bean and Tea Leaf Philippines, Inc. (CBTL)
hired Rolly P. Arenas (Arenas) to work as a barista at its Paseo Center
Branch. His principal functions included taking orders from customers and
preparing their ordered food and beverages.5 Upon signing the
employment contract,6 Arenas was informed of CBTLs existing
179
employment
policies.
chips
in
an
2.
3.
Placing an iced tea bottle in the ice bin despite having knowledge
of company policy prohibiting the same (April 28, 2009). 10
Based on the mystery guest shopper and duty managers reports, Arenas
was required to explain his alleged violations. However, CBTL found
Arenas written explanation unsatisfactory, hence CBTL terminated his
employment.11
Arenas filed a complaint for illegal dismissal. After due proceedings, the LA
ruled in his favor, declaring that he had been illegally dismissed. On
appeal,
the
NLRC
affirmed
the
LAs
decision.
CBTL filed a petition for certiorari under Rule 65 before the CA. CBTL
insisted that Arenas infractions amounted to serious misconduct or willful
disobedience, gross and habitual neglect of duties, and breach of trust and
confidence. To support these allegations, CBTL presented Arenas
letter12 where he admitted his commission of the imputed violations.
On March 26, 2013, the CA issued its decision dismissing the petition. The
CA ruled that Arenas offenses fell short of the required legal standards to
justify his dismissal; and that these do not constitute serious misconduct or
willful disobedience, and gross negligence, to merit his termination from
service. The CA denied CBTLs motion for reconsideration opening the way
for this present appeal via a petition for review on certiorari.
The main issue before us is whether CBTL illegally dismissed Arenas from
employment.
The Petition
CBTL argues that under the terms and conditions of the employment
contract, Arenas agreed to abide and comply with CBTLs policies,
procedures, rules and regulations, as provided for under CBTLs table
of
offenses
and
penalties and/or employee handbook. 13 CBTL
cites serious misconduct as the primary reason for terminating Arenas
employment. CBTL also imputes dishonesty on the part of Arenas for not
immediately admitting that he indeed left his bottled iced tea inside the ice
bin.
Our Ruling
We
DENY
the
petition.
180
disagree
with
CBTL.
continue
working
for
the
employer. 22
However, the facts on record reveal that there was no active dishonesty on
the part of Arenas. When questioned about who placed the bottled iced tea
inside the ice bin, his immediate reaction was not to deny his mistake, but
to remove the bottle inside the bin and throw it outside. More importantly,
when he was asked to make a written explanation of his action, he
admitted
that
the
bottled
iced
tea
was
his.
Thus, even if there was an initial reticence on Arenas part, his subsequent
act of owing to his mistake only shows the absence of a deliberate intent to
lie or deceive his CBTL superiors. On this score, we conclude that Arenas
action
did
not
amount
to
serious
misconduct.
Moreover, the imputed violations of Arenas, whether taken singly or as a
whole, do not necessitate the imposition of the strict and harsh penalty of
dismissal from service. The LA, NLRC and the CA all consistently
ruled that these offenses are not grave enough to qualify as just causes
for dismissal.Factual findings of the labor tribunals especially if
affirmed by the CA must be given great weight, and merit the
Courts
respect.
CBTL also imputes gross and habitual neglect of duty to Arenas for coming
in
late
in
three
separate
instances.
As a final remark, we note that petitioner Walden Chu (Chu) should not be
held jointly and severally liable with CBTL for Arenas adjudged monetary
awards. The LA and the NLRC ruled for their solidary liability but the CA
failed
to
dispose
this
issue
in
its
decision.
In the present case, there was no showing of any evident malice or bad
faith on Chus part as CBTLs president. His participation in Arenas
termination was not even sufficiently alleged and argued. Hence, he
cannot be held solidarily liable for CBTLs liabilities to Arenas.
181
PERLAS-BERNABE, J.:
Assailed in this petition for review on certiorari1 are the Decision2 dated
November 21, 2013 and the Resolution 3 dated April 4, 2014 of the Court of
Appeals (CA) in CA-G.R. SP No. 129108 which affirmed the Decision 4 dated
November 19, 2012 and the Resolution 5 dated January 14, 2013 of the
National Labor Relations Commission (NLRC) in NLRC LAC No. 06-00185812, declaring the dismissal of respondent Maria Theresa V. Sanchez
(Sanchez) illegal.
The Facts
On June 29, 2009, Sanchez was hired by petitioner St. Lukes Medical
Center, Inc. (SLMC) as a Staff Nurse, and was eventually assigned at SLMC,
Quezon Citys Pediatric Unit until her termination on July 6, 2011 for her
purported violation of SLMCs Code of Discipline, particularly Section 1,
Rule 1 on Acts of Dishonesty, i.e., Robbery, Theft, Pilferage, and
Misappropriation
of
Funds. 6
Records reveal that at the end of her shift on May 29, 2011, Sanchez
passed through the SLMC Centralization Entrance/Exit where she was
subjected to the standard inspection procedure by the security personnel.
In the course thereof, the Security Guard on-duty, Jaime Manzanade (SG
Manzanade), noticed a pouch in her bag and asked her to open the
same.7 When opened, said pouch contained the following assortment of
medical stocks which were subsequently confiscated: (a) Syringe 10cl [4
pieces]; (b) Syringe 5cl [3 pieces]; (c) Syringe 3cl [3 pieces]; (d) Micropore
[1 piece]; (e) Cotton Balls [1 pack]; (f) Neoflon g26 [1 piece]; (g) Venofix 25
[2 pieces]; and (h) Gloves [4 pieces] (questioned items). 8 Sanchez asked
SG Manzanade if she could just return the pouch inside the treatment
room; however, she was not allowed to do so. 9 Instead, she was brought to
the SLMC In-House Security Department (IHSD) where she was directed to
write an Incident Report explaining why she had the questioned items in
her possession.10 She complied11 with the directive and also submitted an
undated handwritten letter of apology 12 (handwritten letter) which reads as
follows:
To
In-House
Security,
I am very sorry for bringing things from [SLMC] inside my bag. Pasensya na
182
The NLRC declared that the alleged violation of Sanchez was a unique
case, considering that keeping excess hospital stocks or hoarding was an
admitted practice amongst nurses in the Pediatric Unit which had been
tolerated by SLMC management for a long time. 40 The NLRC held that while
Sanchez expressed remorse for her misconduct in her handwritten letter,
she manifested that she only hoarded the questioned items for future
use in case their medical supplies are depleted, and not for her personal
benefit.41 It further held that SLMC failed to establish that Sanchez was
motivated by ill-will when she brought out the questioned items, noting: (a)
the testimony of SG Manzanade during the conference before the ELRD of
Sanchezs demeanor when she was apprehended, i.e., [d]i naman siya
masyado nataranta,42 and her consequent offer to return the pouch; 43 and
(b) that the said pouch was not hidden underneath the bag. 44 Finally, the
NLRC concluded that the punishment of dismissal was too harsh and the
one (1) month preventive suspension already imposed on and served by
Sanchez was the appropriate penalty. 45 Accordingly, the NLRC ordered her
reinstatement, and the payment of backwages, other benefits, and
attorneys
fees.46
For its part,27 SLMC contended that Sanchez was validly dismissed for just
cause as she had committed theft in violation of Section 1, 28 Rule I of the
SLMC Code of Discipline, 29 which punishes acts of dishonesty, i.e., robbery,
theft, pilferage, and misappropriation of funds, with termination from
service.
The LA Ruling
In a Decision dated May 27, 2012, the Labor Arbiter (LA) ruled that
Sanchez was validly dismissed 31 for intentionally taking the property of
SLMCs clients for her own personal benefit, 32which constitutes an act of
dishonesty
as
provided
under
SLMCs
Code
of
Discipline.
30
According to the LA, Sanchezs act of theft was evinced by her attempt to
bring the questioned items that did not belong to her out of SLMCs
premises; this was found to be analogous to serious misconduct which is a
just cause to dismiss her. 33 The fact that the items she took were neither
SLMCs nor her co-employees property was not found by the LA to be
material since the SLMC Code of Discipline clearly provides that acts of
dishonesty committed to SLMC, its doctors, its employees, as well as its
customers, are punishable by a penalty of termination from service. 34 To
this, the LA opined that [i]t is rather illogical to distinguish the persons
with whom the [said] acts may be committed as SLMC is also answerable
to the properties of its patients. 35 Moreover, the LA observed that Sanchez
was aware of SLMCs strict policy regarding the taking of hospital/medical
items as evidenced by her handwritten letter, 36 but nonetheless committed
the said misconduct. Finally, the LA pointed out that SLMCs non-filing of a
criminal case against Sanchez did not preclude a determination of her
serious misconduct, considering that the filing of a criminal case is entirely
separate and distinct from the determination of just cause for termination
of
employment.37
Aggrieved, Sanchez appealed38 to the NLRC.
In a Decision39 dated November 19, 2012, the NLRC reversed and set aside
the LA ruling, and held that Sanchez was illegally dismissed.
183
connection with the duties which the employee has been engaged
to
discharge.59
Tested against the foregoing, the Court finds that Sanchez was validly
dismissed by SLMC for her willful disregard and disobedience of Section 1,
Rule I of the SLMC Code of Discipline, which reasonably punishes acts of
dishonesty, i.e., theft, pilferage of hospital or co-employee property, x x x
or its attempt in any form or manner from the hospital, co-employees,
doctors, visitors, [and] customers (external and internal) with termination
from employment.60 Such act is obviously connected with Sanchezs work,
who, as a staff nurse, is tasked with the proper stewardship of medical
supplies. Significantly, records show that Sanchez made a categorical
admission61 in her handwritten letter62 i.e., [k]ahit alam kong bawal ay
nagawa kong [makapag-uwi] ng gamit63 that despite her knowledge of
its express prohibition under the SLMC Code of Discipline, she still
knowingly brought out the subject medical items with her. It is apt to clarify
that SLMC cannot be faulted in construing the taking of the questioned
items as an act of dishonesty (particularly, as theft, pilferage, or its
attempt in any form or manner) considering that the intent to gain may be
reasonably presumed from the furtive taking of useful property
appertaining to another.64 Note that Section 1, Rule 1 of the SLMC Code of
Discipline is further supplemented by the company policy requiring the
turn-over of excess medical supplies/items for proper handling 65 and
providing a restriction on taking and bringing such items out of the SLMC
premises without the proper authorization or pass from the official
concerned,66 which Sanchez was equally aware thereof.67Nevertheless,
Sanchez failed to turn-over the questioned items and, instead, hoarded
them, as purportedly practiced by the other staff members in the Pediatric
Unit. As it is clear that the company policies subject of this case are
reasonable and lawful, sufficiently known to the employee, and evidently
connected with the latters work, the Court concludes that SLMC dismissed
Sanchez
for
a
just
cause.
On a related point, the Court observes that there lies no competent basis
to support the common observation of the NLRC and the CA that the
retention of excess medical supplies was a tolerated practice among the
nurses at the Pediatric Unit. While there were previous incidents of
hoarding, it appears that such acts were in similar fashion furtively
made and the items secretly kept, as any excess items found in the
concerned nurses possession would have to be confiscated. 68 Hence, the
fact that no one was caught and/or sanctioned for transgressing the
prohibition therefor does not mean that the so-called hoarding practice
was tolerated by SLMC. Besides, whatever maybe the justification behind
the violation of the company rules regarding excess medical supplies is
immaterial since it has been established that an infraction was deliberately
committed.69 Doubtless, the deliberate disregard or disobedience of rules
by the employee cannot be countenanced as it may encourage him or her
to do even worse and will render a mockery of the rules of discipline that
employees
are
required
to
observe. 70
184
Finally, the Court finds it inconsequential that SLMC has not suffered any
actual damage. While damage aggravates the charge, its absence does not
mitigate nor negate the employees liability. 71Neither is SLMCs non-filing of
the appropriate criminal charges relevant to this analysis. An employees
guilt or innocence in a criminal case is not determinative of the existence
of a just or authorized cause for his or her dismissal. 72 It is well-settled that
conviction in a criminal case is not necessary to find just cause for
termination of employment,73 as in this case. Criminal and labor cases
involving an employee arising from the same infraction are separate and
distinct proceedings which should not arrest any judgment from one to the
other.
As it stands, the Court thus holds that the dismissal of Sanchez was for a
just cause, supported by substantial evidence, and is therefore in order. By
declaring otherwise, bereft of any substantial bases, the NLRC issued a
patently and grossly erroneous ruling tantamount to grave abuse of
discretion, which, in turn, means that the CA erred when it affirmed the
same. In consequence, the grant of the present petition is warranted.
WHEREFORE, the petition is GRANTED. The Decision dated November
21, 2013 and the Resolution dated April 4, 2014 of the Court of Appeals in
CA-G.R. SP No. 129108 are REVERSED and SET ASIDE. The Labor
Arbiters Decision dated May 27, 2012 in NLRC Case No. NCR 07-11042-11
finding respondent Maria Theresa V. Sanchez to have been validly
dismissed
by
petitioner
St.
Lukes
Medical
Center,
Inc.
is
hereby REINSTATED.
SO ORDERED
185
MANSION
PRINTING
CLEMENT CHENG,
Petitioners,
CENTER
-versus-
and
reversed
the
findings
of
the
National
Labor
Relations
Present:
Commission3 and the Labor Arbiter4 that respondent was validly dismissed
CARPIO, J.
Chairperson,
PEREZ,
SERENO,
REYES, and
PERLAS-BERNABE, JJ.*
Promulgated:
January 25, 2012
The Antecedents
2. D E C I S I O N
PEREZ, J.:
Thus,
as
early
as
23
June
1999,
petitioners
issued
186
Explain to respondent but the latter, after reading the directive, refused to
acknowledge receipt thereof.13 He did not submit any explanation and,
thereafter, never reported for work.
29 NOV. 1999
MR. CLEMENT CHENG
SIR:
company found him grossly negligent of his duties, for which reason, his
services were terminated effective 1 April 2000.
continued to disregard attendance policies. His weekly time record for the
first quarter of the year 200010revealed that he came late nineteen (19)
given the amount equivalent to two (2) months salary but the
times out of the forty-seven (47) times he reported for work. He also
incurred nineteen (19) absences out of the sixty-six (66) working days
during the quarter. His absences without prior notice and approval from
March 11-16, 2000 were considered to be the most serious infraction of
reinstatement and for the payment of full backwages, legal holiday pay,
Consequently, Davis Cheng, General Manager of the company and
son
of
petitioner
Cheng,
issued
on
17
March
2000
another
claimed that he took a leave of absence from March 17-23, 2000 19 due to
an urgent family problem. He returned to work on 24 March 2000 20 but
187
Motion
for
Reconsideration
of
the
informed the office that he will be absent for a week. The management
Before the Court of Appeals, respondent sought the annulment of
1.
2.
3.
188
The core issue in this case is whether or not the Court of Appeals
correctly found that the Commission acted without and/or in excess of
jurisdiction and with grave abuse of discretion amounting to lack or excess
of jurisdiction (a) in upholding the termination of respondents employment
and (b) in affirming the denial of his claim for non-payment of holiday pay,
service incentive leave pay, moral and exemplary damages.
Our Ruling
We hold otherwise.
The petition is meritorious.
Upon examination of the documents presented by the parties, we
The special civil action for certiorari seeks to correct errors of
jurisdiction and not errors of judgment.
32
are convinced that the finding of facts on which the conclusions of the
Commission and the Labor Arbiter were based was actually supported
by substantial evidence that amount of relevant evidence as a
reasonable mind might accept as adequate to support a conclusion, even
if other minds, equally reasonable, might conceivably opine
otherwise.36 (Emphasis supplied.)
189
We cannot agree with the Court of Appeals that the sole basis of
the termination of respondents employment was his absences from March
11-16, 2000.
Indeed, the Notice to Explain
38
clearly stated:
To give full meaning and substance to the Notice to Explain, however, the
paragraph should be read together with its preceding paragraph, to wit:
narrated
in
his
Affidavit
that,
upon
instruction
of
the
already left the house but that she did not know where he was going. 41
190
Appeals that the petitioners themselves are not certain of the official time
the statement of the petitioners that there is no need for written rules
since even the [respondent] is aware that his job starts from 8 am to 5
where he admitted that his tardiness has affected the delivery schedules of
pm47 and its Memorandum of 23 June 1999, where it was mentioned that
respondents official time was from 8:30 a.m. to 5:30 p.m. On the contrary,
himself from work or report late during the first quarter of 2000.
his official time from 8:00 a.m. to 5:00 p.m. to 8:30 a.m. to 5:30 p.m. to
hopefully solve the problem on his tardiness.48
191
circumstances.51 These are not overly technical terms, which, in the first
place, are expressly sanctioned by the Labor Code of the Philippines, to
wit:
ART. 282. Termination by employer. - An employer may
terminate an employment for any of the following causes:
(a) xxx
(b) Gross and habitual neglect by the employee of
his duties;
xxx
Clearly, even in the absence of a written company rule defining gross and
And, in the words of then Associate Justice Ma. Alicia AustriaMartinez in Philippine Long Distance and Telephone Company, Inc. v.
Balbastro:
53
192
July 2000 stating that: (1) he is the General Manager of the company; (2)
he personally served each notice upon respondent, when respondent went
to the office/factory on 17 March 2000 and 21 March 2000, respectively;
and (3) on both occasions, after reading the contents of the memoranda,
respondent refused to acknowledge receipt thereof. We are, thus,
convinced that the notices have been validly served.
Premises considered, we find that respondent was accorded both
substantive and procedural due process.
II
We rule otherwise.
In Bughaw v. Treasure Island Industrial Corporation,59 this Court, in
the Notice of Termination, essentially looked for the following: (1) affidavit
of service stating the reason for failure to serve the notice upon the
elucidated:
recipient; and (2) a notation to that effect, which shall be written on the
notice itself.60 Thus:
xxx Bare and vague allegations as to the manner of
service and the circumstances surrounding the same would
not suffice. A mere copy of the notice of termination
allegedly sent by respondent to petitioner, without proof of
receipt, or in the very least, actual service thereof upon
petitioner, does not constitute substantial evidence. It was
unilaterally prepared by the petitioner and, thus, evidently
self-serving and insufficient to convince even an
unreasonable mind.61
Davis Cheng, on the other hand, did both. First, he indicated in the
notices the notation that respondent refused to sign together with the
corresponding dates of service. Second,he executed an Affidavit dated 29
193
pay for every year of service from the commencement of his employment
Be that as it may, petitioners failed to establish by evidence that
respondent had already used the service incentive leave when he incurred
NLRC
money equivalent of the five-day service incentive leave for every year of
NCR
CASE
No.
027871-01are
service covering his employment period from August 1988 to 1 April 2000.
We thus quote with approval the findings of the Court of Appeals
on the following:
[P]rivate respondents bear the burden to prove that
employees have received these benefits in accordance with
law. It is incumbent upon the employer to present the
necessary documents to prove such claim. Although private
respondents labored to show that they paid petitioner his
holiday pay, no similar effort was shown with regard to his
service incentive leave pay. We do not agree with the Labor
Arbiters conclusion that petitioners service incentive leave
pay has been used up by his numerous absences, there
being no proof to that effect.68
This case is hereby REMANDED to the Labor Arbiter for the computation
of respondents service incentive leave pay.
SO ORDERED.
194
ARMANDO ALILING,
Petitioner,
Status.
On
DECISION
Contract
June
[7]
11,
2004,
Aliling
and
WWWEC
inked
an Employment
seeks to set aside the July 3, 2008 Decision [1] and December 15, 2008
Resolution[2] of the Court of Appeals (CA), in CA-G.R. SP No. 101309,
entitled Armando Aliling v. National Labor Relations Commission, Wide
Wide World Express Corporation, Jose B. Feliciano, Manuel F. San Mateo III
and Joseph R. Lariosa. The assailed issuances modified the Resolutions
dated May 31, 2007[3] and August 31, 2007[4] rendered by the National
Labor Relations Commission (NLRC) in NLRC NCR Case No. 00-10-111662004, affirming the Decision dated April 25, 2006[5] of the Labor Arbiter.
The Facts
Barely a month after, Manuel F. San Mateo III (San Mateo), WWWEC
Sales and Marketing Director, emailed Aliling [9] to express dissatisfaction
with the latters performance, thus:
Via a letter dated June 2, 2004,[6] respondent Wide Wide World Express
Armand,
195
Aliling responded two days later. He denied being absent on the days in
question, attaching to his reply-letter [11] a copy of his timesheet[12] which
showed that he worked from September 20 to 24, 2004. Alilings
explanation came with a query regarding the withholding of his salary
corresponding to September 11 to 25, 2004.
In a separate letter dated September 27, 2004, [13] Aliling wrote San
Mateo stating: Pursuant to your instruction on September 20, 2004, I
hereby tender my resignation effective October 15, 2004. While WWWEC
took no action on his tender, Aliling nonetheless demanded reinstatement
and a written apology, claiming in a subsequent letter dated October 1,
2004[14] to management that San Mateo had forced him to resign.
Lariosa again wrote, this time to advise Aliling of the termination of his
services
effective
as
of
that
date
owing
to
his non-satisfactory
performance during his probationary period. Records show that Aliling, for
the period indicated, was paid his outstanding salary which consisted of:
WWWEC also attached to its Position Paper a memo dated September 20,
2004[21] in which San Mateo asked Aliling to explain why he should not be
terminated for failure to meet the expected job performance, considering
that the load factor for the GX Shuttles for the period July to September
was only 0.18% as opposed to the allegedly agreed upon load of 80%
196
Issues having been joined, the Labor Arbiter issued on April 25, 2006
[23]
Both parties appealed the above decision to the NLRC, which affirmed the
Decision in toto in its Resolution dated May 31, 2007. The separate
motions for reconsideration were also denied by the NLRC in its Resolution
10/06/04 12/07/04
P17,300.00 x 2.7 mos. = P35,811.00
197
employee; and (c) the strained relationship existing between the parties
On a procedural matter, petitioner Aliling argues that WWWEC, not
throws the entire case open to review, and that this Court has the authority
case.
198
The Labor Arbiter cryptically held in his decision dated April 25,
2006 that:
From our review, it appears that the labor arbiter, and later the
NLRC, considered Aliling a probationary employee despite finding that he
was not informed of the reasonable standards by which his probationary
employment was to be judged.
The CA, on the other hand, citing Cielo v. National Labor Relations
Commission,[29] ruled that petitioner was a regular employee from the
outset inasmuch as he was not informed of the standards by which his
probationary employment would be measured. The CA wrote:
199
of
the
regularizing
standards
does
not
obtain.
As
To repeat, the labor arbiter, NLRC and the CA are agreed, on the
enjoyed is correct. So was the NLRC ruling, affirmatory of that of the labor
arbiter. In the final analysis, one common thread runs through the holding
of the labor arbiter, the NLRC and the CA, i.e., petitioner Aliling, albeit hired
200
Respondents further allege that San Mateos email dated July 16,
2004 shows that the standards for his regularization were made known to
petitioner Aliling at the time of his engagement. To recall, in that email
message, San Mateo reminded Aliling of the sales quota he ought to meet
as a condition for his continued employment, i.e., that the GX trucks should
explicit provision of Article 281 of the Labor Code, Section 6(d) of the
Implementing Rules of Book VI, Rule VIII-A of the Labor Code and settled
201
the employer has the onus of proving with clear, accurate, consistent, and
convincing evidence the validity of the dismissal.
[34]
Article 282 of the Labor Code considers any of the following acts or
omission on the part of the employee as just cause or ground for
terminating employment:
WWWEC had failed to discharge its twin burden in the instant case.
habitual
neglect
by
the
analogous
to
the
dated October 6, 2004 did not even specifically state Alilings nonsatisfactory performance, or that Alilings termination was by reason of his
failure to achieve his set quota.
In Lim
v.
National
Labor
Relations
Commission,[35] the
Court
202
It
did
so
anew
in Leonardo
v.
National
Labor
Relations
Commission
on the following rationale:
An employer is entitled to impose productivity
standards for its workers, and in fact, non-compliance may
be visited with a penalty even more severe than demotion.
Thus,
[36]
matter is that the alleged imposition of the quota was a desperate attempt
to lend a semblance of validity to Alilings illegal dismissal. It must be
stressed that even WWWECs sales manager, Eve Amador (Amador), in an
internal e-mail to San Mateo, hedged on whether petitioner performed
below or above expectation:
Could not quantify level of performance as he as was
tasked to handle a new product (GX). Revenue report is not
yet administered by IT on a month-to-month basis.
Moreover, this in a way is an experimental activity.
Practically you have a close monitoring with Armand with
regards to his performance. Your assessment of him would
be more accurate.
neglect of duty that is a just cause for dismissal under Article 282 of the
security of tenure. They can only be terminated for cause or when they
prerogative of fixing the quota must be exercised in good faith for the
miserably failed to prove the termination of petitioner was for a just cause
advancement of its interest. The duty to prove good faith, however, rests
with WWWEC as part of its burden to show that the dismissal was for a just
cause. WWWEC must show that such quota was imposed in good faith. This
WWWEC failed to do, perceptibly because it could not. The fact of the
203
has properly been observed. When the Labor Code speaks of procedural
due process, the reference is usually to the two (2)-written notice rule
[38]
204
Here, the first and second notice requirements have not been
properly observed, thus tainting petitioners dismissal with illegality.
at the end of the probationary period. Thus, the appellate court merely
affirmed the monetary award made by the NLRC, which consisted of the
payment of that amount corresponding to the unserved portion of the
contract of employment.
proof such letter had been sent to and received by him. In fact, in his
the contract of employment dated June 11, 2004 was of no moment. In net
effect, as of that date June 11, 2004, Aliling became part of the WWWEC
show that a copy of the letter was duly served upon Aliling. Clearly enough,
salary, until the finality of this Decision. This disposition hews with the
Courts ensuing holding in Javellana v. Belen:[40]
Article 279 of the Labor Code, as amended by
Section 34 of Republic Act 6715 instructs:
Art. 279. Security of Tenure. - In cases of
regular employment, the employer shall not
terminate the services of an employee except for a
just cause or when authorized by this Title. An
employee who is unjustly dismissed from
work shall be entitled to reinstatement
without loss of seniority rights and other
privileges and to his full backwages, inclusive
of allowances, and to his other benefits or
their monetary equivalent computed from the
time his compensation was withheld from
him
up
to
the
time
of
his
actual
reinstatement. (Emphasis supplied)
205
both
awards
should
be
Southern
Industrial
Gases
206
In alleging that WWWEC acted in bad faith, Aliling has the burden
of proof to present evidence in support of his claim, as ruled in Culili v.
Eastern Telecommunications Philippines, Inc.:[46]
According to jurisprudence, basic is the principle
that good faith is presumed and he who alleges bad faith
has the duty to prove the same. By imputing bad faith to
the actuations of ETPI, Culili has the burden of proof to
present substantial evidence to support the allegation of
207
Aliling on the ground that the officers are considered employers acting in
the interest of the corporation. The CA cited NYK International Knitwear
Corporation Philippines (NYK) v. National Labor Relations Commission [50] in
Court ruled:
A dismissal may be contrary to law but by itself
alone, it does not establish bad faith to entitle the
dismissed employee to moral damages. The award of
moral and exemplary damages cannot be justified solely
upon the premise that the employer dismissed his
employee without authorized cause and due process.
support of its argument. Notably, NYK in turn cited A.C. Ransom Labor
Union-CCLU v. NLRC.[51]
208
the
Labor
Code
and
following
our
[53]
ruling
in Exodus
International
to wit:
xxxx
In labor cases, for instance, the Court has held
corporate directors and officers solidarily liable with the
corporation for the termination of employment of
employees done with malice or in bad faith.
A review of the facts of the case does not reveal ample and
satisfactory proof that respondent officers of WWEC acted in bad faith or
with malice in effecting the termination of petitioner Aliling. Even
assuming arguendo that the actions of WWWEC are ill-conceived and
209
WHEREFORE, the
petition
is PARTIALLY
GRANTED. The assailed Resolutions of respondent (Third
Division)
National
Labor
Relations
Commission
are AFFIRMED,
with
the
following MODIFICATION/CLARIFICATION:
Respondent
Wide Wide World Express Corp. is liable to pay Armando
Aliling the following: (a) backwages reckoned from October
6, 2004 up to the finality of this Decision based on a salary
of PhP 17,300 a month, with interest at 6% per annum on
the principal amount from October 6, 2004 until fully paid;
(b) the additional sum equivalent to one (1) month salary
for every year of service, with a fraction of at least six (6)
months considered as one whole year based on the period
from June 11, 2004 (date of employment contract) until the
finality of this Decision, as separation pay; (c) PhP 30,000
as nominal damages; and (d) Attorneys Fees equivalent to
10% of the total award.
SO ORDERED.
210
FLORDELIZA
MARIA
REYES-RAYEL, Petitioner,
vs.
PHILIPPINE
LUEN
THAI
HOLDINGS,
CORPORATION/L&T
INTERNATIONAL GROUP PHILIPPINES, INC.,Respondents.
DECISION
211
confidence on her ability to promote the interests of the company. This led
petitioner to file a Complaint 11 for illegal dismissal, payment of separation
pay, 13th month pay, moral and exemplary damages, attorneys fees, and
other unpaid company benefits against respondents and its officers,
namely, Sauceda, Edles and Willie
Tan (Tan), the Executive Vice-President of PLTHC.
Proceedings before the Labor Arbiter
In her Position Paper, 12 petitioner argued that her dismissal was without
valid or just cause and was effected without due process. According to her,
the causes for her dismissal as stated in the Prerequisite Notice and Notice
of Termination are not proper grounds for termination under the Labor
Code and the same do not even pertain to any willful violation of the
companys code of discipline or any other company policy. Even the
alleged loss of confidence was not supported by any evidence of
wrongdoing on her part. She likewise claimed that due process was not
observed since she was not afforded a hearing, investigation and right to
appeal as per company procedure for disciplining employees. Furthermore,
respondents were guilty of violating the termination provision under the
employment contract which stipulated that employment after probationary
period shall be terminated by giving the employee a three-month notice in
writing or by paying three months salary in lieu of notice. Petitioner also
accused respondents of having acted in bad faith by subjecting her to
public humiliation and embarrassment when she was ordered to
immediately turn over the company car, vacate her office and remove all
her belongings on the same day she received the termination notice, in full
view of all the other employees.
Respondents, on the other hand, claimed that they have a wide discretion
in dismissing petitioner as she was occupying a managerial position. They
claimed in their Position Paper 13 that petitioners inefficiency and
lackadaisical attitude in performing her work were just and valid grounds
for termination. In the same token, her gross and habitual neglect of duties
were enough bases for respondents to lose all their confidence in
petitioners ability to perform her job satisfactorily. Also, petitioner was
accorded due process as she was furnished with two notices - the first
requiring her to explain why she should not be terminated, and the second
apprising her of the managements decision to terminate her from
employment.
Further in their Reply 14 to petitioners position paper, respondents
enumerated the various instances which manifested petitioners poor work
attitude and dismal performance, to wit: 1) her failure to perform in
accordance with management directives such as when she unreasonably
delayed the hiring of a Human Rights and Compliance Manager; failed to
establish communication with superiors and co-workers; failed to regularly
212
1.
SO ORDERED.
2.
3.
Salaries
and
P80,000 x 13.30 months =
13th
month
P1,064,000.00 / 12 =
VL
P80,000 / 26 x 10 days =
Wages
P1,064,000.00
pay
88,666.67
34,102.56
P1,186,769.23
118,676.92
P1,305,446.15
SO ORDERED,
17
22
213
Moreover, the CA did not subscribe to petitioners allegation that she was
denied due process.1wphi1 On the contrary, said court found that she
was adequately notified of the charges against her through the show cause
notice which clearly stated the instances that served as sufficient bases for
the loss of trust and confidence, to wit: her failure to perform in
accordance with management directives and her actions of undermining
company goals and causing disharmony among her co-workers. After
finding her written response to be unsatisfactory, petitioner was likewise
properly notified of the companys decision to terminate her services.
Clearly, respondents observed the requirements of procedural due process.
Nevertheless, respondents, in effecting the dismissal, should have paid
petitioner her salary for three months as provided for in the employment
contract. For its failure to do so, the CA ordered respondents to pay
petitioner three months salary in accordance with their contractual
undertaking. The dispositive portion of the CA Decision states:
ALLEGATIONS
AGAINST
PETITIONER
IN
RESPONDENTS OWN COMPANY POLICIES.33
VIOLATION
OF
The petition is devoid of merit. The Court finds no cogent reason to depart
from the ruling of the CA that petitioner was validly dismissed.
SO ORDERED.30
denied
in
the
CA
Issues
Hence, the present petition raising the following issues:
THAT PETITIONER WAS ILLEGALLY DISMISSED FROM HER
EMPLOYMENT BY RESPONDENTS.I. WHETHER X X X THE COURT OF
APPEALS COMMITTED AN ERROR WHEN IT REVERSED THE
DECISION OF THE NLRC ON CERTIORARI DESPITE THE FACT THAT
THE NLRC DID NOT COMMIT GRAVE ABUSE OF DISCRETION WHEN
IT AFFIRMED THE FACTUAL FINDINGS OF THE LABOR ARBITER
II. WHETHER X X X THE ALLEGED VALID OR JUST CAUSE FOR
TERMINATION OF PETITIONER FROM HER EMPLOYMENT WAS
PROVEN AND ESTABLISHED BY SUBSTANTIAL EVIDENCE ON
RECORD.
III. WHETHER X X X RESPONDENTS DEPRIVED PETITIONER OF HER
RIGHT TO DUE PROCESS WHEN RESPONDENTS DISMISSED
PETITIONER WITHOUT CONDUCTING ANY INVESTIGATION TO
DETERMINE THE VERACITY AND TRUTHFULNESS OF THE
Petitioner, in the present case, was L&Ts CHR Director for Manufacturing.
As such, she was directly responsible for managing her own departmental
staff. It is therefore without question that the CHR Director for
Manufacturing is a managerial position saddled with great responsibility.
Because of this, petitioner must enjoy the full trust and confidence of her
superiors. Not only that, she ought to know that she is "bound by more
exacting work ethics"37and should live up to thishigh standard of
responsibility. However, petitioner delivered dismal performance and
displayed poor work attitude which constitute sufficient reasons for an
employer to terminate an employee on the ground of loss of trust and
confidence. Respondents also impute upon petitioner gross negligence and
incompetence which are likewise justifiable grounds for dismissal. 38 The
burden of proving that the termination was for a valid cause lies on the
employer.39 Here, respondents were able to overcome this burden as the
evidence presented clearly support the validity of petitioners dismissal.
214
215
Neither can there be any denial of due process due to the absence of a
hearing or investigation at the company level. It has been held in a
plethora of cases that due process requirement is met when there is simply
an opportunity to be heard and to explain ones side even if no hearing is
conducted.49 In the case of Perez v. Philippine Telegraph and Telephone
Company,50 this Court pronounced that an employee may be afforded
ample opportunity to be heard by means of any method, verbal or written,
whether in a hearing, conference or some other fair, just and reasonable
way, in that:
xxxx
As she was served with a notice apprising her of the changes against her
and also a subsequent notice informing her of the management's decision
to terminate her services alter respondents found her written response to
the first notice unsatisfactory, petitioner was clearly afforded her right to
due process.
After receiving the first notice apprising him of the charges against him,
the employee may submit a written explanation (which may be in the form
of a letter, memorandum, affidavit or position paper) and offer evidence in
support thereof, like relevant company records (such as his 201 file and
daily time records) and the sworn statements of his witnesses. For this
purpose, he may prepare his explanation personally or with the assistance
of a representative or counsel. He may also ask the employer to provide
him copy of records material to his defense. His written explanation may
also include a request that a formal hearing or conference be held. In such
a case, the conduct of a formal hearing or conference becomes mandatory,
just as it is where there exist substantial evidentiary disputes or where
company rules or practice requires an actual hearing as part of
employment pretermination procedure. To this extent, we refine the
decisions we have rendered so far on this point of law.
xxxx
In sum, the following are the guiding principles in connection with the
hearing requirement in dismissal cases:
(a) ample opportunity to be heard means any meaningful
opportunity (verbal or written) given to the employee to answer
WHEREFORE, the petition is DENIED. The assailed Decision dated July 18,
2006 of the Court of Appeals in CA-GR. SP No. 86937 is AFFIRMED.
SO ORDERED.
216
Present:
Since 1990, Villanueva had been employed with Meralco as bill collector,
teller and branch representative. Sometime in June 2002, Francisco
- versus -
Promulgated:
June 13, 2012
x
-------------------------------------------------------------------------------------------------------x
DECISION
MENDOZA, J.:
Santos (Santos), office team leader and assistant office team leader of the
This petition for review on certiorari assails the December 13, 2006
Decision[1] of the Court of Appeals (CA) in CA-G.R. SP. No. 95826 which
dismissed the petition challenging the November 30, 2004 [2] and June 20,
2006[3] Resolutions
of
the
National
that
Labor
petitioner
Relations
Vicente
Nepomuceno stated that in the course of the routine checking of his men
for March 2002, he found the unusual additional deposit payments
accepted by Villanueva. When he made further verification on the
collection reports of the latter, he also discovered additional deposits he
received from other customers. Upon confirming Villanuevas act of
contract modification with a customer named Sherwin Borja, Nepomuceno
217
User ID. Corporate Audit was also asked to investigate his irregular
end of the day. He claimed that there were instances when initial entries of
order that the customers deposit payment could be entered. In cases when
the customer was no longer in the office premises, he would just record
Villanuevas
service application.
counsel
to
cross-examine
the
witnesses
(complaining
advised that the case would be considered submitted for decision as the
issues had already been joined with the submission of his counter-affidavit.
collections on the same day they were collected. Santos claimed that
Villanueva had never reported a case of overage in his collections since
2001.
reads:
deposit
charged
from
applicants
for
electric
service
218
grievous error for not giving him a chance to confront the customers who
stood as witnesses against him. There being no financial report relied on
during the investigation save for mere affidavits executed by said
customers, the investigative process was a sham, entitling him not only to
backwages but also moral and exemplary damages.
For its part, Meralco defended Villanuevas dismissal as valid and for
a just cause. The evidence consisting of sworn statements of the customers,
corporate
audits,
field
reports,
and
affidavits
of
Nepomuceno
and Santos sufficiently substantiated the case against him. After evaluating
the pieces of evidence and the merits of Villanuevas defense, the assigned
denied both substantive and procedural due process because there was no
formal charge yet when Meralco effected his termination. He argued that
approved
Villanuevas modus
charge. He thus waited for the formal charge against him as signed by the
Chairman.
and tarnished Meralcos good name, Villanueva was justly terminated from
by
management. The
operandi in
evidence
the
presented
processing
of
exposed
customer
employment.
Anent the charge of misappropriation of company funds, Villanueva
claimed that the amount was intact with the office and it was only during
the preparation of forms that sometimes confusion would occur, but this
was promptly corrected upon discovery to reflect the correct amount for the
kind of service paid for. He further claimed that even assuming that the
error was committed, the offense could not have warranted a penalty of
mention of his case in a specific manner. At most, his case was one of
simple
negligence
because
the
company
was
not
prejudiced
219
amount
involved
that
he
indeed
reported
his
overages
to
his
proof
c) failure
of
the
company
to
reasonably establish that the act of
the employee is inimical to its interest
or has caused undue prejudice to its
operation.
trust and confidence. The dispositive portion of the NLRC Resolution reads:
WHEREFORE, the appealed Decision of Labor
Arbiter a quo dated June 30, 2004 is hereby ordered
VACATED and SET ASIDE, and a new one entered declaring
complainants dismissal from service as VALID and
JUSTIFIED.
xxx
merit.[13]
one
(1)
sack
of
rice
per
month
and
bonuses
for
two
(2)
[12]
220
GROUNDS
I.
THE HONORABLE COURT OF APPEALS ERRED IN NOT
FINDING GRAVE ABUSE OF DISCRETION AMOUNTING
TO LACK OR EXCESS OF JURISDICTION ON THE PART
OF THE PUBLIC RESPONDENTS ACT OF REVERSING
THE DECISION OF THE LABOR ARBITER A QUO, AND
DECLARING PETITIONERS DISMISSAL AS VALID AND
JUSTIFIED,
AND
SUBSEQUENTLY
DENYING
PETITIONERS MOTION FOR RECONSIDERATION.
II.
xxx
xxx in this case, the amount of discrepancy or money
misappropriated by petitioner may be minimal, even
inconsequential (1,600.00). But what is reprehensible is
petitioners irregular and anomalous practice of requiring
applicants for electric service connection to pay amounts in
excess of the minimum deposit charge but indicating only
the said minimum charge in the Contract of Electric
Service, making it appear later that the omission was only
a mistake if the customer comes back to the office and
asks about the discrepancy and substituting another
contract with the full payment tendered already reflected
therein, and not reporting any overage at all to the branch
supervisor with respect to those excess payments which
were no longer questioned by the customers.
xxx
WHEREFORE, premises considered, the present
petition is hereby DENIED DUE COURSE and accordingly
DISMISSED for lack of merit. The challenged Resolutions
dated November 30, 2004 and June 20, 2006 of the
National Labor Relations Commission in NLRC-NCR CA No.
040992-04 (NLRC-NCR Case No. 00-01-00977-03) are
hereby AFFIRMED.[17]
221
for the application of the doctrine: (1) loss of confidence should not be
simulated; (2) it should not be used as a subterfuge for causes which are
improper, illegal or unjustified; (3) it may not be arbitrarily asserted in the
face of overwhelming evidence to the contrary; and (4) it must be genuine,
not a mere afterthought, to justify an earlier action taken in bad faith. [21]
of
the
amount
due
for
service
connection
from
222
the care and custody of the employers money or property. To the first class
belong managerial employees, that is, those vested with the powers and
that there was a mistake in the initial transaction with the customers
personal gain, why did Villanueva exact from customers amounts in excess
of what was required by the company? What would have Villanueva done
had the customers failed to discover the discrepancy between the amount
they paid and that appearing in the receipts issued to them? Why were
amount less than the actual payment made by the customers and,
employee like Villanueva. These doubts sway the Court away from
Villanuevas claim that his errors were promptly corrected upon discovery.
certainly work-related. This is, in fact, the core of his position as a Branch
Representative.
the
specific
acts
constituting
the
charge
against
him. In
fact,
no
223
they are exercised in good faith for the advancement of the employers
affidavit. He was able to submit it, where he denied the charges against
interest and not for the purpose of defeating or circumventing the rights of
the
Meralco. Where a party is given the opportunity to explain his side of the
case, the right to due process is deemed recognized for what is frowned
cross-examination
of
the
witnesses
was
not
permitted
by
The Court commiserates with the heirs of Villanueva for his death
workers not only good performance, adequate work and diligence, but also
last 2007. The Court, as dispenser of justice, however, has to apply the law
good conduct and loyalty. The employer may not be compelled to continue
based on the facts of the case. Considering that the employer has proved a
just and valid cause for Villanuevas termination, the Court has no option
[25]
as there was no dispute that it had lost trust and confidence in Villanueva
and his abilities to perform his tasks with utmost efficiency and honesty
expected of an employee trusted to handle customers and funds. With
substantial evidence presented and Villanuevas failure to proffer plausible
explanation denying the charges against him, there can be no other
conclusion for the Court but to affirm his dismissal.
SO ORDERED.
224
PHILIPPINE
PLAZA
HOLDINGS,
vs.
MA. FLORA M. EPISCOPE, Respondent.
INC., Petitioner,
DECISION
PERLAS-BERNABE, J.:
This is a petition for review on certiorari under Rule 45 of the Rules of Court
assailing
the
March
26,
2010
Decision 1 and
July
5,
2010
2
Resolution rendered by the Court of Appeals (CA) in CA-G.R. SP No.
102188. The CA reversed and set aside the Resolutions 3 of the National
Labor Relations Commission (NLRC) dared May 30, 2007 and November 14,
2007 in NLRC NCR CA No. 047187-06/NLRC NCR-12-13621-04 and thereby
declared respondent to have been illegally dismissed.
Petitioner Philippine Plaza Holdings, Inc. (PPHI) is the owner and operator of
the Westin Philippine Plaza Hotel (Hotel). Respondent Ma. Flora M. Episcope
(Episcope) was employedby PPHI since July 24, 1984 until she was
terminated on November 4, 2004 for dishonesty, willful disobedience and
serious misconduct amounting to loss of trust and confidence.
In order to check the performance of the employees and the services in the
different outlets of the Hotel, PPHI regularly employed the services of
independent auditors and/or professional shoppers.For this purpose,Sycip,
Gorres and Velayoauditors dined at the Hotels Caf Plaza on August 28,
2004. After dining, the auditors were billed the total amount of P2,306.65,
representing the cost of the food and drinks they had ordered under Check
No. 565938.4 Based on the audit report 5 submitted to PPHI, Episcope was
one of those who attended to the auditors and was the one who handed
the check and received the payment of P2,400.00. She thereafter returned
Check No. 565938, which was stamp marked "paid," together with the
change.
Upon verification of the foregoing check receipt with the sales report of
Caf Plaza, it was discovered that the Hotel's copy of the receipt bore a
discount of P906.456on account of the use of a Starwood Privilege Discount
Card registered in the name of Peter A. Pamintuan, while the receipt issued
by Episcope to the auditors reflected the undiscounted amount
of P2,306.65considering that none of the auditors had such discount card.
In view of the foregoing, the amount actually remitted to the Hotel was
only P1,400.20thus, leaving a shortage of P906.45.
On September 30, 2004, the Hotel issued a Show-Cause Memo 7 directing
Episcope to explain in writing why no disciplinary action should be taken
against her for the questionable and invaliddiscount application on the
settlement check issued to the auditors on August 28, 2004.
In her handwritten letter,8 Episcope admitted that she was on duty on the
date and time in question but alleged that she could no longer recall if the
concerned guests presented a Starwood Privilege Discount Card.
On October 4, 2004, Episcope was placed on preventive suspension
without pay.9 During the administrative hearing on October 6, 2004,
Episcope, who was therein assisted by the Union President and four union
representatives from National Union of Workers in Hotel Restaurant and
Allied Industries (NUWHRAIN)-Philippine Plaza Hotel Chapter, confirmed the
fact that she was the one who presented the subject check and received
the corresponding payment from the guests. She, however, denied
stampingthe said check as "paid" or that she gaveany discount without a
discount card, explaining that she could not have committed such acts
given that all receipts and discount applications were handled by the
cashier. But when asked why the discounted receipt was not given to the
guests, she merely replied that she could no longer remember. In a
separate inquiry, the cashier of Caf Plaza, however, maintained that a
Starwood Privilege Discount Card must have been presented during the
said incident given that there was a Discount Slip 10 and a stamped receipt
indicating such discounted payment.11
Finding Episcope to have failed to sufficiently explain the questionable
discount application on the settlement bill of the auditors, her employment
was terminated for committing acts ofdishonesty, which was classified as a
Class D offense under the Hotel's Code of Discipline, as well as for willful
disobedience, serious misconduct and loss of trust and confidence. 12
225
Aggrieved, Episcope filed a complaint13 for illegal dismissal with prayer for
payment of damages and attorney's fees against PPHI before the NLRC
docketed as NLRC-NCR Case No. 00-12-13621-04.
226
227
228
ROLANDO
DS.TORRES, Petitioner,
vs.
RURAL BANK OF SAN JUAN, INC., ANDRES CANO CHUA, JOBEL GO
CHUA, JESUS CANO CHUA, MEINRADO DALISAY, JOSE MANALANSAN
III, OFELIA GINA BE and NATY ASTRERO, Respondents.
DECISION
REYES, J.:
This Petition for Review on Certiorari, 1 under Rule 45 of the Rules of Court,
seeks to reverse and set aside the Decision 2 dated February 21, 2008 of
the Court of Appeals (CA) in CA-G.R. SP No. 94690 dismissing the
complaint for illegal dismissal filed by petitioner Rolando OS. Torres
(petitioner) against respondent Rural Bank of San Juan, Inc. (RBSJT) and its
officers who are the herein individual respondents, namely: Andres Cano
Chua (Andres), Jobel Go Chua (Jobel), Jesus Cano Chua (Jesus), Meinrado
Dalisay, Jose Manalansan III (Jose), Ofelia Ginabe (Ofelia) and Naty Astrero
(collectively referred to as respondents).3
Likewise assailed is the CA Resolution 4 dated June 3, 2008 which denied
reconsideration.
The antecedents
Culled from the rulings of the labor tribunals and the appellate court are
the ensuing factual milieu:5
The petitioner was initially hired by RBSJI as Personnel and Marketing
Manager in 1991. After a six-month probationary period and finding his
performance to be satisfactory, RBSJI renewed his employment for the
same post to a permanent/regular status. In June 1996, the petitioner was
offered the position of Vice-President for RBSJIs newly created department,
Allied Business Ventures. He accepted the offer and concomitantly
relinquished his post. The vacancy created was filled by respondent Jobel
who temporarily held the position concurrently as a Corporate Planning
and Human Resources Development Head.
229
The petitioner claimed that on March 19, 1997, respondent Jesus verbally
terminated him from employment but he later on retracted the same and
instead asked the petitioner to tender a resignation letter. The petitioner
refused. A month thereafter, the petitioner received the memorandum
asking him to explain why he cleared Jacinto of financial accountabilities
and thereafter another memorandum terminating him from employment.
For their part, the respondents maintained that the petitioner was validly
dismissed for loss of trust and confidence precipitated by his unauthorized
issuance of a financial accountability clearance sans audit to a resigned
employee. They averred that a copy of the clearance mysteriously
disappeared from RBSJIs records hence, the petitioners claim that it
pertained only to Jacintos paid cash advances and salary loan cannot
stand for being uncorroborated.
Attempts at an amicable settlement were made but the same proved futile
hence, the Labor Arbiter11 (LA) proceeded to rule on the complaint.
Ruling of LA
In its Decision12 dated November 27, 1998, the LA sustained the claims of
the petitioner as against the factually unsubstantiated allegation of loss of
trust and confidence propounded by the respondents. The LA observed
that the petitioners selfless dedication to his job and efforts to achieve
RBSJIs stability, which the respondents failed to dispute, negate any
finding of bad faith on his part when he issued a clearance of
accountabilities in favor of Jacinto. As such, the said act cannot serve as a
valid and justifiable ground for the respondents to lose trust and
confidence in him.
The LA further held that the failure of both parties to present a copy of the
subject clearance amidst the petitioners explanation that it did not
absolutely release Jacinto from liability, should work against the
respondents since it is the proof that will provide basis for their supposed
loss of trust and confidence.
The LA upheld the petitioners contention that the loss of trust and
confidence in him was indeed a mere afterthought to justify the
respondents premeditated plan to ease him out of RBSJI. The LAs
conclusion was premised on the convergence of the following
circumstances: (1) the petitioners stint from 1991-1996 was not marred
with any controversy or complaint regarding his performance; (2) when
230
Jobel joined RBSJI in the latter part of 1996, he took over the department
led by the petitioner thus placing the latter in a floating status; and (3) the
petitioners temporary transfer to the N. Domingo branch was designed to
deliberately put him in a bind and blame him on whatever course of action
he may take to resolve the same.
Accordingly, the petitioner was found to have been illegally dismissed and
thus accorded the following reliefs in the decretal portion of the LA
Decision, viz:
WHEREFORE, premises considered, judgment is hereby rendered ordering
respondent Bank and individual respondents, to reinstate [the petitioner to
his previous or equivalent position, without loss of seniority rights and
other benefits and privileges appurtaining [sic] to him, and to pay the
petitioner the following:
1. The petitioners partial backwages and other emoluments in the
form of allowances, as gasoline, maintenance, representation,
uniform and membership allowances, from the time of his
dismissal up to his actual date of reinstatement, which as of this
date amount to:
Backwages (Partial) P244,800.00
Gasoline Allowances .. 63,000.00
Maintenance Allowance . 45,000.00
Representation Allowance .. 54,000.00
Membership Allowance .. 12,000.00
Uniform Allowance 8,000.00
Total P426,800.00
2. The petitioners 13th month pay from the time of his dismissal
up to actual date of reinstatement, which as of this date amounts
to Twenty-Seven Thousand Two Hundred (P27,200.00) Pesos;
231
Traversing both motions, the NLRC issued its Decision 18 dated March 3,
2006: (1) granting the petitioners plea for the reconsideration of its
Resolution dated April 14, 2000 thus effectively reversing and nullifying the
same; and (2) denying the respondents motion for reconsideration of the
Order dated September 30, 2005.
Anent the first disposition, the NLRC accorded weight to the explanations
proffered by the petitioner that the clearance issued to Jacinto was limited
only to his paid cash advances and salary loan. The NLRC further held that
the offense imputed to the petitioner is not covered by Category B, Grave
Offense No. 1 of RBSJIs Code of Conduct and Discipline as it does not
appear that he falsified or misrepresented personal or other company
records, documents or papers.19
Taking an entirely opposite stance, the NLRC declared that the clearance
issued by the petitioner did not prejudice RBSJIs interest as it was limited
in scope and did not entirely clear Jacinto from all his financial
accountabilities. Also, the petitioner was only "a day old" at the N.
Domingo branch and thus he cannot be reasonably expected to be aware
of the misdeeds purportedly committed by Jacinto.20
For the foregoing reasons, the NLRC reversed its earlier ruling and
reinstated the LAs Decision dated November 27, 1998, thus:
WHEREFORE, the Arbiters decision of 27 November 1998 is hereby
AFFIRMED and REINSTATED.
Accordingly, the Resolution of 14 April 2000 is REVERSED and SET ASIDE.
Finally, the respondents Motion for Reconsideration dated 2 November
2005 is DENIED for lack of merit.
SO ORDERED.21
Ruling of the CA
The respondents sought recourse with the CA, 22 which in its
Decision23 dated February 21, 2008 reversed and set aside the NLRC
Decision dated March 3, 2006 and ruled that the petitioner was dismissed
for a just cause. The appellate court articulated that as the Acting Manager
of RBSJIs N. Domingo branch, the petitioner held a highly sensitive and
critical position which entailed the conscientious observance of company
On the other hand, the respondents invoke the ratiocinations of the CA that
they were justified in losing the trust and confidence reposed on the
petitioner since he failed to exercise the degree of care expected of his
managerial position. They reiterate the petitioners admission that no audit
was yet conducted as to the accountabilities of Jacinto when he issued the
clearance.
The respondents further assert that as a former Personnel Manager, the
petitioner is well-aware of RBSJIs policy that before a resigned employee
232
To temper the exercise of such prerogative and to reconcile the same with
the employees Constitutional guarantee of security of tenure, the law
imposes the burden of proof upon the employer to show that the dismissal
of the employee is for just cause failing which would mean that the
dismissal is not justified. Proof beyond reasonable doubt is not necessary
but the factual basis for the dismissal must be clearly and convincingly
established.34
Further, the law mandates that before validity can be accorded to a
dismissal premised on loss of trust and confidence, two requisites must
concur, viz: (1) the employee concerned must be holding a position of
trust; and (2) the loss of trust must be based on willful breach of trust
founded on clearly established facts.35
There is no arguing that the petitioner was part of the upper echelons of
RBSJIs management from whom greater fidelity to trust is expected. At the
time when he committed the act which allegedly led to the loss of RBSJIs
trust and confidence in him, he was the Acting Manager of N. Domingo
branch. It was part of the petitioners responsibilities to effect a smooth
turn-over of pending transactions and to sign and approve instructions
within the limits assigned to the position under existing regulations. 36 Prior
thereto and ever since he was employed, he has occupied positions that
entail the power or prerogative to dictate management policies as
Personnel and Marketing Manager and thereafter as Vice-President.
The presence of the first requisite is thus certain. Anent the second
requisite, the Court finds that the respondents failed to meet their burden
of proving that the petitioners dismissal was for a just cause.
The act alleged to have caused the loss of trust and confidence of the
respondents in the petitioner was his issuance, without prior authority and
audit, of a clearance to Jacinto who turned out to be still liable for unpaid
cash advances and for an P11-million fraudulent transaction that exposed
RBSJI to suit. According to the respondents, the clearance barred RBSJI
from running after Jacinto. The records are, however, barren of any
evidence in support of these claims.
As correctly argued by the petitioner and as above set forth, the onus of
submitting a copy of the clearance allegedly exonerating Jacinto from all
his accountabilities fell on the respondents. It was the single and absolute
evidence of the petitioners act that purportedly kindled the respondents
loss of trust. Without it, the respondents allegation of loss of trust and
confidence has no leg to stand on and must thus be rejected. Moreover,
one can reasonably expect that a copy of the clearance, an essential
personnel document, is with the respondents. Their failure to present it and
the lack of explanation for such failure or the documents unavailability
props up the presumption that its contents are unfavorable to the
respondents assertions.
At any rate, the absence of the clearance upon which the contradicting
claims of the parties could ideally be resolved, should work against the
respondents. With only sworn pleadings as proof of their opposite claims
on the true contents of the clearance, the Court is bound to apply the
principle that the scales of justice should be tilted in favor of labor in case
of doubt in the evidence presented.37
RBSJI also failed to substantiate its claim that the petitioners act estopped
them from pursuing Jacinto for his standing obligations. There is no proof
that RBSJI attempted or at least considered to demand from Jacinto the
233
payment of his unpaid cash advances. Neither was RBSJI able to show that
it filed a civil or criminal suit against Jacinto to make him responsible for
the alleged fraud. There is thus no factual basis for RBSJIs allegation that it
incurred damages or was financially prejudiced by the clearance issued by
the petitioner.
More importantly, the complained act of the petitioner did not evince
intentional breach of the respondents trust and confidence. Neither was
the petitioner grossly negligent or unjustified in pursuing the course of
action he took.
It must be pointed out that the petitioner was caught in the quandary of
signing on the spot a standard employment clearance for the furious
Jacinto sans any information on his outstanding accountabilities, and
refusing to so sign but risk alarming or scandalizing RBSJI, its employees
and clients. Contrary to the respondents allegation, the petitioner did not
concede to Jacintos demands. He was, in fact, able to equalize two equally
undesirable options by bargaining to instead clear Jacinto only of his
settled financial obligations after proper verification with branch cashier
Lily. It was only after Lily confirmed Jacintos recorded payments that the
petitioner signed the clearance. The absence of an audit was precisely
what impelled the petitioner to decline signing a standard employment
clearance to Jacinto and instead issue a different one pertaining only to his
paid accountabilities.
Under these circumstances, it cannot be concluded that the petitioner was
in any way prompted by malicious motive in issuing the clearance. He was
also able to ensure that RBSJIs interests are protected and that Jacinto is
pacified. He did what any person placed in a similar situation can prudently
do. He was able to competently evaluate and control Jacintos demands
and thus prevent compromising RBSJIs image, employees and clients to an
alarming scene.
The Court has repeatedly emphasized that the act that breached the trust
must be willful such that it was done intentionally, knowingly, and
purposely, without justifiable excuse, as distinguished from an act done
carelessly, thoughtlessly, heedlessly or inadvertently. 38 The conditions
under which the clearance was issued exclude any finding of deliberate or
conscious effort on the part of the petitioner to prejudice his employer.
Also, the petitioner did not commit an irregular or prohibited act. He did
not falsify or misrepresent any company record as it was officially
confirmed by Lily that the items covered by the clearance were truly
234
The disposition of the case made by the LA in its Decision dated November
27, 1998, as affirmed by the NLRC in its Decision dated March 6, 2006, is
most in accord with the above disquisitions hence, must be reinstated.
However, the monetary awards therein should be clarified.
The petitioner is entitled to separation pay in lieu of reinstatement and his
back wages shall earn legal interest.
In accordance with current jurisprudence, the award of back wages shall
earn legal interest at the rate of six percent (6%) per annum from the date
of the petitioners illegal dismissal until the finality of this
decision.41Thereafter, it shall earn 12% legal interest until fully paid 42 in
accordance with the guidelines in Eastern Shipping Lines, Inc., v. Court of
Appeals.43
In addition to his back wages, the petitioner is also entitled to separation
pay. It cannot be gainsaid that animosity and antagonism have been
brewing between the parties since the petitioner was gradually eased out
of key positions in RBSJI and to reinstate him will only intensify their hostile
working atmosphere.44 Thus, based on strained relations, separation pay
equivalent to one (1) month salary for every year of service, with a fraction
of a year of at least six (6) months to be considered as one (1) whole year,
should be awarded in lieu of reinstatement, to be computed from date of
his engagement by RBSJI up to the finality of this decision. 45
The award of separation pay in case of strained relations is more beneficial
to both parties in that it liberates the employee from what could be a
highly oppressive work environment in as much as it releases the employer
from the grossly unpalatable obligation of maintaining in its employ a
worker it could no longer trust.46
employer fired his employee without just cause or due process. Additional
facts must be pleaded and proven to warrant the grant of moral damages
under the Civil Code, i.e., that the act of dismissal was attended by bad
faith or fraud, or constituted an act oppressive to labor, or was done in a
manner contrary to morals, good customs or public policy; and, of course,
that social humiliation, wounded feelings, grave anxiety, and similar injury
resulted therefrom.48 (Citations omitted)
Bad faith does not connote bad judgment or negligence; it imports a
dishonest purpose or some moral obliquity and conscious doing of wrong;
it means breach of a known duty through some motive or interest or ill will;
it partakes of the nature of fraud.49
Here, the petitioner failed to prove that his dismissal was attended by
explicit oppressive, humiliating or demeaning acts. The following events
merely sketch the struggle for power within the upper management of
RBSJI between the "old guys" and the "new guys"; they do not convincingly
prove that the respondents schemed to gradually ease the petitioner out,
viz: (1) his promotion as Vice-President; (2) his replacement by Jobel as
Personnel and Marketing Manager; (2) his designation as Acting Manager of
N. Domingo branch and the recall thereof on the very next day; (3) the
presence of Andres, Jose and Ofelia at the N. Domingo branch in the
morning of
September 27, 1996; and (4) Georges inaction on the petitioners request
to be transferred to the operations or marketing department. As
disagreeable as they may seem, these acts cannot be equated with bad
faith that can justify an award of damages.
Since no moral damages can be granted under the facts of the case,
exemplary damages cannot also be awarded.50
235
236
RAMON
LUDENA, Petitioners,
DECISION
REYES, J.:
Before this Court is a petition for review on certiorari 1 under Rule 45 of the
Decision2 dated June 30, 2011 of the Court of Appeals (CA) in CA-GR. SP
No. 03069, affirming the finding of the National Labor Relations
Commission (NLRC) that respondent Flordeliz Velayo (respondent) was
illegally dismissed. The Resolution 3 dated September 14, 2011 denied the
motion for reconsideration thereof.
tracing the overage; and that the omission or failure to report immediately
the overage (sic) was just a simple mistake without intent to defraud her
employer. On March 10, 2008, after the conduct of a formal investigation
and
after
finding
complainants
(herein
private
respondents)
[explanations] without merit, PJ LHUILLIER (herein petitioner) terminated
her employment as per Notice of Termination on grounds of serious
misconduct and breach of trust.4 (Citation omitted)
On March 14, 2008, the respondent filed a complaint for illegal dismissal,
separation pay and other damages against P.J. Lhuillier, Inc. (PJLI) and
Mario Ramon Ludea, Area Operations Manager (petitioners). On July 23,
2008, the Labor Arbiter (LA) rendered judgment, the dispositive portion of
which reads as follows:
WHEREFORE, in view of all the foregoing, judgment is hereby entered
ordering the dismissal of the instant complaint for lack of merit.
The Facts
SO ORDERED.5
The LA found that the respondents termination was valid and based not on
a mere act of simple negligence in the performance of her duties as
cashier:
This is not a case of simple negligence as the facts show that complainant,
instead of reporting the matter immediately, had set aside the P540.00 for
her personal use instead of reporting the overage or recording it in the
operating system of the company.
Complainant is not entitled to moral as well as exemplary damages for lack
of basis.6
On appeal, the NLRC in its Decision dated March 19, 2009 countermanded
the LA, holding that the respondent was illegally dismissed since the
petitioners failed to prove a just cause of serious misconduct and willful
breach of trust:
In fine, the Labor Arbiter a quoutterly disregarded the rule on
proportionality that has been observed in a number of cases, that is, "the
penalty imposed should be commensurate to the gravity of his offense." x
xx
xxxx
237
In the instant case, PJ LHUILLIER was not able to discharge the burden of
proving that the dismissal of the complainant was for valid or just causes
of serious misconduct and willful breach of trust. Thus, We disagree with
the Labor Arbiters findings and conclusion that complainant was validly
dismissed from service.
xxxx
... Significantly, the complainants omission or procedural lapse did not
cause any loss or damage to the company.7
Nonetheless, finding that the relations between the petitioners and the
respondent have become strained, the NLRC did not order the
reinstatement of the respondent. Thus:
WHEREFORE, the instant appealis GRANTED. The assailed decision is
hereby SET ASIDE and REVERSED, and a new one entered declaring that
complainant was ILLEGALLY DISMISSED. Accordingly, respondent PJ (CEBU)
LHUILLIER, INC. is hereby ORDERED:
We concur with the NLRC in finding for private respondent. Time and again,
the Supreme Court has held that it is cruel and unjust to impose the drastic
penalty of dismissal if not commensurate to the gravity of the misdeed.
238
Private respondents lapse was not a "serious" one, let alone indicative of
serious misconduct. In fact, she (herein private respondent) admitted that
she was not able to report the overage to the supervisor since the latter
was on leave on that day and that she was still tracing the overage; and
that the omission or failure to report immediately the overage was just a
simple mistake without intent to defraud her employer. As found by the
NLRC, private respondent worked for petitioner for almost six (6) years,
and it is not shown that she committed any infraction of company rules
during her employment. In fact, private respondent was once awarded by
petitioner due to her heroic act of defending her Manager, Ms. Lilibeth
Cortez, while resisting a hold-upper.
The settled rule is that when supported by substantial evidence, factual
findings made by quasi-judicial and administrative bodies are accorded
great respect and even finality by the courts. These findings are not
infallible, though; when there is a showing that they were arrived at
arbitrarily or in disregard of the evidence on record, they may be examined
by the courts. Hence, when factual findings of the Labor Arbiter and the
NLRC are contrary to each other, there is a necessity to review the records
to determine which conclusions are more conformable to the evidentiary
facts. The case before Us shows that the finding of the NLRC is supported
by substantive evidence as compared to the finding of the Labor Arbiter
with respect to the issue of illegal dismissal. Moreover, in case of doubt,
such cases should be resolved in favor of labor, pursuant to the social
justice policy of labor laws and the Constitution.
Finally, it is a time-honored principle that although it is the prerogative of
management to employ the services of a person and likewise to discharge
him, such is not without limitations and restrictions. The dismissal of an
employee must be done with just cause and without abuse of discretion. It
must not bedone in an arbitrary and despotic manner. To hold otherwise
would render nugatory the security of tenure clause enshrined in the
Constitution.10 (Citations omitted and emphasis ours)
Invoking Article 27911 of the Labor Code, the CA agreed with the NLRC that
the respondent should have been reinstated without loss of seniority rights
and other privileges, with payment of her full backwages, inclusive of
allowances and other benefits or their monetary equivalent computed from
the time her compensation was withheld up to the time of actual
reinstatement. However, with the parties relations now strained, the CA
conceded that the payment of a separation pay, along with backwages as
a separate and distinct relief, is an acceptable alternative to reinstatement.
The CA further awarded the respondent attorneys fees since she was
239
over the country. On October 29, 2007, a customer sent P500.00 through
its branch in Capistrano, Cagayan de Oro City, and paid a remittance fee
of P40.00. Inexplicably, however, no corresponding entry was made to
recognize the cash receipt of P540.00 in the computerized accounting
system (operating system) ofthe PJLI. The respondent claimed that she
tried very hard but could not trace the source of her unexplained cash
surplus ofP540.00, but a branch audit conducted sometime in December
2007 showed that it came from a "Pera Padala" customer.
To be sure, no significant financial injury was sustained by the PJLI in the
loss of a mere P540.00 in cash, which, according to the respondent she
sincerely wanted to account for except that she was pre-empted by fear of
what her branch manager might do once she learned of it. But in treating
the respondents misconduct as a simple negligence or a simple mistake,
both the CA and the NLRC grossly failed to consider that she held a
position of utmost trust and confidence in the company.
There are two classes of corporate positions of trust: on the one hand are
the managerial employees whose primary duty consists of the
management of the establishment in which they are employed or of a
department or a subdivision thereof, and other officers or members of the
managerial staff;on the other hand are the fiduciary rank-and-file
employees, such as cashiers, auditors, property custodians, or those who,
in the normal exercise of their functions, regularly handle significant
amounts of money or property. These employees, though rank-and-file, are
routinely charged with the care and custody of the employers money or
property, and are thus classified as occupying positions of trust and
confidence.16
The respondent was first hired by the petitioners as an accounting clerk on
June 13, 2003, for which she received a basic monthly salary of P9,353.00.
On October 29, 2007, the date of the subject incident, she performed the
function of vault custodian and cashier in the petitioners Branch 4
pawnshop in Capistrano, Cagayan de Oro City. In addition to her custodial
duties, it was the respondent who electronically posted the days
transactions in the books of accounts of the branch, a function that is
essentially separate from that of cashier or custodian. It is plain to see then
that when both functions are assigned to one person to perform, a very
risky situation of conflicting interests is created whereby the cashier can
purloin the money in her custody and effectively cover her tracks, at least
temporarily, by simply not recording in the books the cash receipt she
misappropriated. This is commonly referred to as lapping of
240
accounts.17 Only a most trusted clerk would be allowed to perform the two
functions, and the respondent enjoyed this trust.
The series of willful misconduct committed by the respondent in
mishandling the unaccounted cash receipt exposes her as unworthy of the
utmost trust inherent in her position as branch cashier and vault custodian
and bookkeeper.
The respondent insists that she never intended to appropriate the money
but was afraid that Tuling would scold her, and that she kept the money for
a long time in her drawer and only decided to take it home after her search
for the cause of the cash overage had proved futile. Both the CA and the
NLRC agreed with her, and held that what she committed was a simple
mistake or simple negligence.
The Court disagrees.
Granting arguendothat for some reason not due to her fault, the
respondent could not trace the source of the cash surplus, she nonetheless
well knew and understood the companys policy that unexplained cash
must be treated as miscellaneous income under the account "Other
Income," and that the same must be so recognized and recorded at the
end of the day in the branch books or "operating system." No such entry
was made by the respondent, resulting in unrecorded cash in her
possession of P540.00, which the company learned about only two months
thereafter through a branch audit.
Significantly, when Tuling returned on November 3, 2007 from her leave of
absence, the respondent did not just withhold from her the fact that she
had an unaccounted overage, but she refused to seek her help on what to
do about it, despite having had five days to mull over the matter until
Tulings return.
241
242
243
M.
b.
c.
d.
e.
DECISION
REYES, J.:
Before this Court on Petition for Review on Certiorari1 is the Decision2 dated
October 17, 2013 of the Court of Appeals (CA) in CA-G.R. SP No. 125103,
which
reversed
the
Decision3 dated
February
29,
2012
and
Resolution4 dated May 7, 2012 of the National Labor Relations Commission
(NLRC) in NLRC LAC No. 08-002249-11, and reinstated with modifications
the Decision5 dated April 29, 2011 of the Labor Arbiter (LA) in NLRC Case
No. RAB-IV-03-00618-10-C, which found that respondent Antonio M.
Farrales (Farrales) was illegally dismissed by Hocheng Philippines
Corporation (HPC). The fallo of the appellate decision reads:
WHEREFORE, premises considered, the Decision of the Labor Arbiter
dated April 29, 2011 in NLRC Case No. RAB-IV-03-00618-10-C is reinstated
with modifications. Private respondent Hocheng Philippines Corporation
is liable to pay [Farrales] the following:
(1) Full backwages from date of dismissal on February 15, 2010 until date
of decision equivalent to P276,466.67;
(2) Separation pay of one (1) month salary per year of service for a period
of twelve years equivalent to P228,800.00;
(3) Appraisal year-end bonus in the sum of P11,000.00; and,
(4) Attorneys fees equivalent to 10% of the total award.
SO ORDERED.
The Facts
Later that day, HPC sent Farrales a notice to explain his involvement in the
alleged theft. The investigation was supported by the employees union,
ULO-Hocheng.9Below is Farrales explanation, as summarized by the CA:
On November 27, 2009, [Farrales] borrowed a helmet from his co-worker
Eric Libutan (Eric) since they reside in the same barangay. They agreed
that Eric could get it at the house of [Farrales] or the latter could return it
the next time that they will see each other. Eric told him that his
motorcycle was black in color. As there were many motorcycles with
helmets, he asked another employee, Andy Lopega (Andy) who was in
the parking area where he could find Erics helmet. Andy handed over to
him the supposed helmet which he believed to be owned by Eric, then he
went
home.
On November 28, 2009, at around 6 oclock in the morning, he saw Eric at
theirbarangay and told him to get the helmet. But Eric was in a rush to go
to
work,
he
did
not
bother
to
get
it.
In the morning of December 3, 2009, upon seeing Eric in the workplace,
[Farrales] asked him why he did not get the helmet from his house. Eric
told him that, Hindi po sa akin yung nakuha nyong helmet. [Farrales] was
shocked and he immediately phoned the HPCs guard to report the
situation that he mistook the helmet which he thought belonged to Eric.
After several employees were asked as to the ownership of the helmet, he
finally found the owner thereof, which is Jun Reyess (Jun) nephew,
Reymar, who was with him on November 27, 2009. [Farrales] promptly
apologized to Jun and undertook to return the helmet the following day and
explained that it was an honest mistake. These all happened in the
244
morning of December 3, 2009; [Farrales] did not know yet that HPC will
send a letter demanding him to explain. 10
A hearing was held on December 10, 2009 at 1:00 p.m. Present were
Farrales, Eric Libutan (Eric), Andy Lopega (Andy), Jun Reyes, Antonio Alinda,
a witness, and Rolando Garciso, representing ULO-Hocheng. From Andy it
was learned that at the time of the alleged incident, he was already seated
on his motorcycle and about to leave the company compound when
Farrales approached and asked him to hand to him a yellow helmet
hanging from a motorcycle parked next to him. When Andy hesitated,
Farrales explained that he owned it, and so Andy complied. But Eric had
specifically told Farrales that his helmet was colored red and black and his
motorcycle was a black Honda XRM-125 with plate number 8746-DI,
parked near the perimeter fence away from the walkway to the pedestrian
gate. The CCTV showed Farrales instructing Andy to fetch a yellow helmet
from a blue Rossi 110 motorcycle with plate number 3653-DN parked in the
middle of the parking lot, opposite the location given by Eric. Farrales in his
defense claimed he could no longer remember the details of what
transpired that time, nor could he explain why he missed Erics specific
directions.11
On February 15, 2010, the HPC issued a Notice of Termination 12 to Farrales
dismissing him for violation of Article 69, Class A, Item No. 29 of the HPC
Code of Discipline, which provides that stealing from the company, its
employees and officials, or from its contractors, visitors or clients, is akin
to serious misconduct and fraud or willful breach by the employee
of the trust reposed in him by his employer or duly authorized
representative, which are just causes for termination of employment
under
Article
282
of
the
Labor
Code.
On March 25, 2010, Farrales filed a complaint for illegal dismissal, nonpayment of appraisal and mid-year bonuses, service incentive leave pay
and 13th month pay. He also prayed for reinstatement, or in lieu thereof,
separation pay with full backwages, plus moral and exemplary damages
and attorneys fees. During the mandatory conference, HPC paid Farrales ?
10,914.51, representing his 13th month pay for the period of January to
February 2010 and vacation leave/sick leave conversion. Farrales agreed to
waive
his
claim
for
incentive
bonus. 13
On April 29, 2011, the LA ruled in favor of Farrales, 14 the fallo of which is as
follows:
WHEREFORE, PREMISES CONSIDERED, all the respondents Hocheng Phils.
Corporation, Inc. Sam Chen[g] and Judy Geregale are found guilty of illegal
dismissal and ordered jointly and severally to pay complainant the
following:
1. Full backwages from date of dismissal on February 15, 2010 until date
of decision equivalent to P276,466.67.
2. Separation pay of one (1) month salary per year of service for a period
of twelve years equivalent to P228,800.00.
THEFT
IS
JUST
CAUSE
FOR
TERMINATION.
245
The Court has always taken care, therefore, that the employer does not
invoke any baseless justification, much less management prerogative, as a
subterfuge by which to rid himself of an undesirable worker, 28 and thus in
exceptional cases the Court has never hesitated to delve into the NLRCs
factual conclusions where evidence was found insufficient to support them,
or too much was deduced from the bare facts submitted by the parties, or
the LA and the NLRC came up with conflicting positions, as is true in this
case.29
Court
resolves
to
deny
the
petition.
To validly dismiss an employee, the law requires the employer to prove the
existence of any of the valid or authorized causes, 24 which, as enumerated
in Article 282 of the Labor Code, are: (a) serious misconduct or willful
disobedience by the employee of the lawful orders of his employer or the
latters representative in connection with his work; (b) gross and habitual
neglect by the employee of his duties; (c) fraud or willful breach by the
employee of the trust reposed in him by his employer or his duly
authorized representative; (d) commission of a crime or offense by the
employee against the person of his employer or any immediate member of
his family or his duly authorized representative; and (e) other causes
analogous to the foregoing.25 As a supervisorial employee, Farrales is
admittedly subject to stricter rules of trust and confidence, and thus
pursuant to its management prerogative HPC enjoys a wider latitude of
discretion to assess his continuing trustworthiness, than if he were an
ordinary rank-and-file employee.26 HPC therefore insists that only
substantial proof of Farrales guilt for theft is needed to establish the just
causes to dismiss him, as the NLRC lengthily asserted in its decision.
Article 4 of the Labor Code mandates that all doubts in the implementation
and interpretation of the provisions thereof shall be resolved in favor of
labor. Consistent with the States avowed policy to afford protection to
labor, as Article 3 of the Labor Code and Section 3, Article XIII of the 1987
Constitution have enunciated, particularly in relation to the workers
security of tenure, the Court held that [t]o be lawful, the cause for
termination must be a serious and grave malfeasance to justify the
deprivation of a means of livelihood. This is merely in keeping with the
spirit of our Constitution and laws which lean over backwards in favor of
the working class, and mandate that every doubt must be resolved in their
As aptly pointed out by the LA, while HPC has the onus probandi that the
taking of Reymars helmet by Farrales was with intent to gain, it failed to
discharge this burden, as shown by the following circumstances: Farrales
sought and obtained the permission of Eric, his co-employee as well
asbarangay co-resident, to borrow his helmet; at the parking lot, Farrales
asked another employee, Andy, to fetch a yellow helmet from one of the
parked motorcycles, mistakenly thinking it belonged to Eric (whom he
knew owned two helmets); the following day, November 28, Farrales asked
Eric why he had not dropped by his house to get his helmet, and Eric
replied that Farrales got the wrong helmet because he still had his other
helmet with him; Farrales immediately sought the help of the company
guards to locate the owner of the yellow helmet, who turned out to be
Reymar; Farrales apologized to Reymar for his mistake, and his apology
was promptly accepted.30 All these circumstances belie HPCs claim that
Farrales took Reymars helmet with intent to gain, the LA said.
In ruling that Farrales dismissal by HPC was attended with utmost malice
and bad faith as to justify an award of moral and exemplary damages and
attorneys fees, the LA stated that [i]t is succinctly clear that [the]
respondents [therein] tried to blow out of proportions the indiscretion of
[Farrales] for reasons known only to them, and moreover, [f]inding that
the dismissal on the ground of theft is unavailing, [the] respondents
[therein] immediately offered [Farrales] his former position when he filed
[his] complaint. What does this act of [the] respondents [therein] speak
[of]?31
On the other hand, the NLRC found that Farrales lied, first, when he told
Andy, then already astride his motorbike at the parking area and about to
leave the company premises, that the yellow helmet belonged to
him,32 and second, when he claimed that Eric was his neighbor, although
they were not. It ruled as doubtful Farrales hazy recollection about what
happened that afternoon at the parking lot, since he could not even give a
description of the motorcycle from which he took the yellow helmet. These
circumstances, the NLRC determined, comprise substantial proof belying
Farrales claim of good faith. As a supervisory employee, he held a position
of high responsibility in the company making him accountable to stricter
rules of trust and confidence than an ordinary employee, and under Article
246
He is now before
this
Court
via
petition
for
review
247
his ideal weight. In line with company policy, he was removed from flight
trim down to his ideal weight and report for weight checks on several
dates. He was also told that he may avail of the services of the company
physician should he wish to do so. He was advised that his case will be
evaluated on July 3, 1989.[2]
The Facts
On February 25, 1989, petitioner underwent weight check. It was
Petitioner Armando G. Yrasuegui was a former international flight
steward of Philippine Airlines, Inc. (PAL). He stands five feet and eight
at 215 pounds, which is 49 pounds beyond the limit. Consequently, his off-
inches (58) with a large body frame. The proper weight for a man of his
height and body structure is from 147 to 166 pounds, the ideal weight
being 166 pounds, as mandated by the Cabin and Crew Administration
Manual[1] of PAL.
On October
17,
Administrator
gaining 2 pounds from his previous weight. After the visit, petitioner made
petitioner
failed
to
meet
the
companys
weight
Dear Sir:
I would like to guaranty my commitment towards a
weight loss from 217 pounds to 200 pounds from today
until 31 Dec. 1989.
From thereon, I promise to continue reducing at a
reasonable percentage until such time that my ideal weight
is achieved.
248
directive and did not report for weight checks. On June 26, 1990, petitioner
was required to explain his refusal to undergo weight checks. [7]
From then on, nothing was heard from petitioner until he followed
up his case requesting for leniency on the latter part of 1992. He weighed
informed of the PAL decision for him to remain grounded until such time
at 219 pounds on August 20, 1992 and 205 pounds on November 5, 1992.
he did not deny being overweight. What he claimed, instead, is that his
violation, if any, had already been condoned by PAL since no action has
been taken by the company regarding his case since 1988. He also claimed
that PAL discriminated against him because the company has not been fair
in treating the cabin crew members who are similarly situated.
Division.
On December 8, 1992, a clarificatory hearing was held where
On April 17, 1990, petitioner was formally warned that a repeated
refusal to report for weight check would be dealt with accordingly. He was
given another set of weight check dates. [6] Again, petitioner ignored the
249
On June 15, 1993, petitioner was formally informed by PAL that due
his weight did not hamper the performance of his duties. [16] Assuming that
to his inability to attain his ideal weight, and considering the utmost
almost five (5) years, his services were considered terminated effective
i.e., Mr. Palacios, Mr. Cui, and Mr. Barrios, were promoted instead of being
immediately.[11]
disciplined.[18]
[19]
On November
18,
1998,
Labor
Arbiter Valentin C.
Reyes
ruled[13] that petitioner was illegally dismissed. The dispositive part of the
Arbiter ruling runs as follows:
WHEREFORE, in view of the foregoing, judgment is
hereby rendered, declaring the complainants dismissal
illegal, and ordering the respondent to reinstate him to his
former position or substantially equivalent one, and to pay
him:
a. Backwages of Php10,500.00 per month from his
dismissal on June 15, 1993 until reinstated, which for
purposes of appeal is hereby set from June 15, 1993 up
to August 15, 1998 atP651,000.00;
b. Attorneys fees of five percent (5%) of the total
award.
SO ORDERED.[14]
The Labor Arbiter held that the weight standards of PAL are
reasonable in view of the nature of the job of petitioner. [15] However, the
weight standards need not be complied with under pain of dismissal since
250
ten (10) days from notice failing which, the same shall be
deemed as complainants reinstatement through payroll
and execution in case of non-payment shall accordingly be
issued by the Arbiter. Both appeals of respondent thus,
are DISMISSED for utter lack of merit.[25]
The CA opined that there was grave abuse of discretion on the part
of the NLRC because it looked at wrong and irrelevant considerations [33] in
evaluating the evidence ofthe parties. Contrary to the NLRC ruling, the
weight standards of PAL are meant to be a continuing qualification for an
misconduct by petitioner to the lawful order of PAL for him to lose weight.
as the NLRC seemed to suggest. [35] Said the CA, the element of willfulness
[27]
[26]
conclusion on whether the dismissal is legally proper. [36] In other words, the
Like the Labor Arbiter, the NLRC found the weight standards
Arbiter holding that petitioner was not remiss in the performance of his
Just like the Labor Arbiter and the NLRC, the CA held that the weight
[29]
for purposes of escaping the result of his dismissal for being overweight. [40]
the matter to the Court of Appeals (CA) via a petition for certiorari under
Rule 65 of the 1997 Rules of Civil Procedure.[30]
On May
reconsideration.
[31]
the NLRC:
10,
[41]
2005,
the
CA
denied
petitioners
motion
for
Issues
SO ORDERED.[32]
In this Rule 45 petition for review, the following issues are posed for
resolution:
251
I.
WHETHER OR NOT THE COURT OF APPEALS
GRAVELY ERRED IN HOLDING THAT PETITIONERS OBESITY
CAN BE A GROUND FOR DISMISSAL UNDER PARAGRAPH (e)
OF ARTICLE 282 OF THE LABOR CODE OF THE PHILIPPINES;
II.
WHETHER OR NOT THE COURT OF APPEALS
GRAVELY ERRED IN HOLDING THAT PETITIONERS DISMISSAL
FOR OBESITY CAN BE PREDICATED ON THE BONA FIDE
OCCUPATIONAL QUALIFICATION (BFOQ) DEFENSE;
III.
WHETHER OR NOT THE COURT OF APPEALS GRAVELY
ERRED IN HOLDING THAT PETITIONER WAS NOT UNDULY
DISCRIMINATED AGAINST WHEN HE WAS DISMISSED WHILE
OTHER OVERWEIGHT CABIN ATTENDANTS WERE EITHER
GIVEN FLYING DUTIES OR PROMOTED;
IV.
WHETHER OR NOT THE COURT OF APPEALS
GRAVELY ERRED WHEN IT BRUSHED ASIDE PETITIONERS
CLAIMS FOR REINSTATEMENT [AND] WAGES ALLEGEDLY
FOR
BEING
MOOT AND ACADEMIC.[43] (Underscoring
supplied)
Our Ruling
is
physical
abnormality
and/or
standards. The dismissal of the employee would thus fall under Article
282(e) of the Labor Code. As explained by the CA:
It is clear that, except the just cause mentioned in subparagraph 1(a), all the others expressly enumerated in the
law are due to the voluntary and/or willful act of the
employee. How Nadurasillness could be considered as
252
easily availed the assistance of the company physician, per the advice
of PAL.[51] He chose to ignore the suggestion. In fact, he repeatedly failed to
report when required to undergo weight checks, without offering a valid
substantially different from the case at bar. First, Nadura was not decided
under the Labor Code. The law applied in that case was Republic Act (RA)
No. 1787. Second, the issue of flight safety is absent in Nadura, thus, the
rationale there cannot apply here. Third, in Nadura, the employee who was
a miner, was laid off from work because of illness, i.e., asthma. Here,
States Court of Appeals (First Circuit). In that case, Cook worked from 1978
petitioner was dismissed for his failure to meet the weight standards
of PAL. He was not dismissed due to illness. Fourth, the issue in Nadura is
respondent. She
record. Even respondent admitted that her performance met the Centers
petitioner for his failure to meet the weight standards of PAL. Fifth,
in Nadura, the employee was not accorded due process. Here, petitioner
that time, she stood 52 tall and weighed over 320 pounds. Respondent
was accorded utmost leniency. He was given more than four (4) years to
evacuate patients in case of emergency and it also put her at greater risk
twice
resigned
voluntarily
with
an
unblemished
of serious diseases.
In the case at bar, the evidence on record militates against
petitioners claims that obesity is a disease. That he was able to reduce his
weight from 1984 to 1992 clearly shows that it is possible for him to lose
claimed that [t]he issue is could I bring my weight down to ideal weight
[50]
concomitant disability.
253
the
musculoskeletal,
respiratory,
and
cardiovascular
sex, religion, or national origin unless the employer can show that sex,
(BFOQ).[55] In the United States, there are a few federal and many state job
discrimination laws that contain an exception allowing an employer to
words of the District Court for the District of Rhode Island, Cook was
sometime before 1978 at least one hundred pounds more than what is
business or enterprise.[56]
weighed over 320 pounds in 1988. Clearly, that is not the case here.At his
exist if there is no statute providing for it. [57] Further, there is no existing
heaviest, petitioner was only less than 50 pounds over his ideal weight.
obesity
may
not
be
unintended,
but
is
nonetheless
Second,
in British
Columbia Public
Service
Employee
Commission
254
safely as far as human care and foresight can provide, using the utmost
[64]
diligence
of
circumstances.
very
cautious
persons,
with
due
regard
for
all
the
[75]
BFOQ, the employer must prove that (1) the employment qualification is
common carrier. Thus, it is only logical to hold that the weight standards
reasonably related to the essential operation of the job involved; and (2)
of PAL show its effort to comply with the exacting obligations imposed
that there is factual basis for believing that all or substantially all persons
[68]
crew who are on board the aircraft. The weight standards of PAL should be
viewed as imposing strict norms of discipline upon its employees.
Association
of Detailman-PTGWTO
weight standards for cabin crew is flight safety. It cannot be gainsaid that
upon the validity of a company policy which prohibits its employees from
just like all common carriers, thrive due to public confidence on their safety
records. People, especially the riding public, expect no less than that
airline companiestransport
[70]
their
passengers
to
their
respective
and CA[73] are one in holding that the weight standards of PAL are
meals or attending to the whims and caprices of the passengers. The most
reasonable. A common carrier, from the nature of its business and for
important activity of the cabin crew is to care for the safety of passengers
[72]
255
safety goes to the core of the job of a cabin attendant.Truly, airlines need
aisles and exit doors just to accommodate overweight cabin attendants like
petitioner.
occasion call for it. The job of a cabin attendant during emergencies is to
constricted cabin space, and narrow aisles and exit doors. Thus, the
speedily get the passengers out of the aircraft safely. Being overweight
are what cabin attendants are dealing with, not minutes. Three lost
passengers to their destination; and that the weight standards has nothing
seconds can translate into three lost lives. Evacuation might slow down
[76]
relied upon by
petitioner cannot apply to his case. What was involved there were two (2)
airline pilots who were denied reassignment as flight engineers upon
reaching the age of 60, and a flight engineer who was forced to retire at
age 60. They sued the airline company, alleging that the age-60 retirement
presumed to know the weight limit that he must maintain at all times. [78] In
1967. Age-based BFOQ and being overweight are not the same. The case
fact, never did he question the authority of PAL when he was repeatedly
asked to trim down his weight. Bona fides exigit ut quodconvenit fiat. Good
space and narrow aisles and emergency exit doors of the airplane, any
faith
an.
demands
that
what
is
agreed
upon
shall
be
perform their task. That an obese cabin attendant occupies more space
limitations based on height and body frame for both male and female
256
standards. Thus,
the
clear-cut
rules
obviate
any
ideal weights; weights over their ideal weights; the periods they were
of PAL.
assigned to them; the discriminating treatment they got from PAL; and
other relevant data that could have adequately established a case of
III. Petitioner failed to substantiate his claim that he was
discriminatory treatment by PAL. In the words of the CA, PAL really had no
substantial case of discrimination to meet.[82]
agencies, like the Labor Arbiter and the NLRC, are accorded respect, even
discrimination came into play in this case as a secondary position for the
matters within their specific and specialized jurisdiction. [84] But the
principle is not a hard and fast rule. It only applies if the findings of facts
the applicable standard and the private respondents failure to comply. [80] It
is a basic rule in evidence that each party must prove his affirmative
allegation.[81]
have infallibility and must be set aside when they fail the test of
Since the burden of evidence lies with the party who asserts an
affirmative
allegation,
petitioner
has
to
prove
his
allegation
arbitrariness.[85]
with
of
discriminatory
treatment.
Petitioner
cannot
establish
Here,
the
Labor
Arbiter
and
the
NLRC
to how and why they are similarly situated and the differential treatment
petitioner got from PAL despite the similarity of his situation with other
employees.
against
acts
of
private
the
United
Indeed, except for pointing out the names of the supposed overweight
[89]
which
257
however
Labor Arbiter.[95] In fact, petitioner duly received the return to work notice
on February 23, 2001, as shown by his signature.[96]
As his last contention, petitioner avers that his claims for reinstatement
the time the employer failed to reinstate him despite the issuance of a writ
and wages have not been mooted. He is entitled to reinstatement and his
full backwages, from the time he was illegally dismissed up to the time
reinstate and pay the wages of the employee during the period of appeal
[92]
until reversal by the higher court. [99] He failed to prove that he complied
At this point, Article 223 of the Labor Code finds relevance:
with
the
return
to
work
order
rendered
of PAL. Neither
services
does
it
the
again, the Court ruled that the law does not exact compliance with the
impossible.[100]
Normally,
legally
dismissed
employee
is
not
entitled
to
separation pay. This may be deduced from the language of Article 279 of
the Labor Code that [a]n employee who is unjustly dismissed from work
[94]
258
SO ORDERED.
259
- versus -
Promulgated:
The letter also notified her that she was being relieved of her other
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
Subsequently, on August 16, 1999, Galay was terminated for alleged loss
DECISION
of confidence. Thereafter, she filed with the Labor Arbiter a complaint for
QUISUMBING, J.:
August
30,
2001
and
Before the labor arbiter, petitioners alleged that Galay had an attitude
problem and did not get along with her co-employees for which she was
constantly warned to improve. Petitioners aver that Galays attitude
resulted to the decline in the companys efficiency and productivity.
Petitioners presented a letter[4] dated February 23, 1999 and a notice of
termination[5] dated August 16, 1999.
The Labor Arbiter found that Galay was illegally terminated for petitioners
failure to prove that she violated any company regulation, and for failure to
give the proper notice as required by law.[6]
260
Petitioner appealed to the NLRC. The latter, however, denied the appeal for
lack of merit and affirmed the decision of the Labor Arbiter. [7] A motion for
reconsideration was subsequently filed but which was likewise denied. [8]
relationship between
Galay and petitioners.
respondent
Simply, the issues are (1) Were the petitioners denied due process with the
because the attached board resolution was issued after the petition was
filed.[10]
in the affirmative, was this sufficiently proved? (4) Were the procedural
requirements for an effectual dismissal present? and (5) Were the awards
Anent the first issue, petitioners posit that instead of denying outright their
petition on technicalities, the Court of Appeals should have given it due
course. Petitioners explain that only the name and address of petitioner
Heavylift were stated in the petition because it was the real party in
interest, while the rest were mere nominal parties. They also reasoned that
261
it was not necessary to attach the pleadings submitted to the Labor Arbiter
pleading are true and correct and not the product of the imagination or a
matter of speculation, and that the pleading is filed in good faith. [15]
not present any persuasive reason for a liberal application of the Rules.
The Rules of Court require that the petition for certiorari shall be verified,
contain the full names and actual addresses of all the petitioners and
[12]
[13]
ventilate their cases on the merits. In that way, the ends of justice would
be better served.[14]
trust and confidence. They aver that respondent did not deny the strained
and irreconcilable relationship between them, in effect, admitting the
262
same. Further, petitioners aver that having lost their trust and confidence
on Galay, they could no longer make her in-charge of the confidential Crew
the company for he can upset and strain the working environment. Without
well. Thus, management has the prerogative to take the necessary action
the companys work atmosphere had become very strained and had
differences
gravely affected the workers and their outputs. Galays dismissal, according
between
employees
and
management
affect
the
work
analogous to loss of trust and confidence that must be duly proved by the
Petitioners explained that they sent Galay a letter of notice dated February
employer. Similarly, compliance with the twin requirement of notice and
23, 1999, apprising her of her low performance and her attitude problem,
hearing must also be proven by the employer.
before the letter of her termination dated August 16, 1999. Petitioners
claim that the company waited for six months, to give Galay a chance to
However, we are not convinced that in the present case, petitioners have
Galay counters that petitioners failed to show a just and valid cause for her
beyond reasonable doubt is not required, still there must be substantial
termination, and that letters of notice and termination did not comply with
evidence to support the termination on the ground of attitude. [19] The mere
the twin requirement of notice and hearing. Galay argues that the letter
mention of negative feedback from her team members, and the letter
dated February 23, 1999 neither informed her of her infraction of any
dated February 23, 1999, are not proof of her attitude problem. Likewise,
company rule that warrants disciplinary action; nor required her to submit
her failure to refute petitioners allegations of her negative attitude does
an explanation.
not amount to admission. Technical rules of procedure are not binding in
labor cases.[20] Besides, the burden of proof is not on the employee but on
263
the employer who must affirmatively show adequate evidence that the
evidence that these benefits were already paid. Moreover, this issue
involves
question
of
fact
which
is
not
proper
in
petition
for certiorari and the determinations of the Labor Arbiter and the NLRC are
In our view, neither does the February 23, 1999 letter constitute the
afforded great weight and respect by the courts on these matters, when
required notice. The letter did not inform her of the specific acts
these findings are supported by substantial evidence, and devoid of any
complained of and their corresponding penalty. The law requires the
unfairness or arbitrariness. [23] Hence, their findings must be sustained.
employer to give the worker to be dismissed two written notices before
terminating his employment, namely, (1) a notice which apprises the
WHEREFORE, the Decision dated September 16, 2000 of the Labor Arbiter
sought; and (2) the subsequent notice which informs the employee of the
30, 2001 and the Resolution dated September 28, 2001 of the National
employers decision to dismiss him. [22] Additionally, the letter never gave
hereby AFFIRMED.
process.
Costs against petitioners.
In sum, we find that Galay was illegally dismissed, because petitioners
failed to show adequately that a valid cause for terminating respondent
exists, and because petitioners failed to comply with the twin requirement
of notice and hearing.
Apropos the award of service incentive pay and 13 th month pay, we find
that they were properly prayed for by Galay. These were subsumed in the
complaint and under the position papers general prayer of such other relief
as are just and equitable under the law. Petitioners failed to present
SO ORDERED.
264
ELPIDIO CALIPAY,
Before the Court is a petition for review on certiorari seeking to annul and
Petitioner,
set aside the Decision[1] and Resolution[2] of the Court of Appeals (CA),
dated August 24, 2004 andDecember 10, 2004, respectively, in CA-G.R. SP
Present:
No.
79277. The
CA
Decision
dismissed
the
special
civil
action
- versus -
MENDOZA, JJ.
On July 16, 1999, a Complaint[3] for illegal dismissal, unfair labor practice,
underpayment of wages and 13th month pay, non-payment of service
incentive leave pay, overtime pay, premium pay for holiday, rest day, night
Promulgated:
shift allowances and separation pay was filed by herein petitioner Elpidio
Calipay, together with Alfredo Mission and Ernesto Dimalanta against
herein private respondents Triangle Ace Corporation (Triangle) and Jose
August 3, 2010
Lee.
x-----------------------------------------------------------------------------------------x
Calipay and the other complainants alleged in their Position Paper
that in the course of their employment, they were not given any specific
work assignment; they performed various kinds of work imposed upon
DECISION
PERALTA, J.:
265
wages, they were not given any duly accomplished payslips; instead, they
were forced to sign a blank form of their daily time records and salary
vouchers.
their
alleged
participation
and
assistance
in
provided in Article 282 of the Labor Code; (3) the complainants failure to
report
for
work
were
justified
by
their
sudden
termination
from
Dimalantas claim for disability benefits with the Social Security System;
despite their denials, Lee scolded Calipay and Mission; this incident later
266
PETITION
FOR
CERTIORARI
AND
AFFIRMING
THE
RESOLUTIONS OF PUBLIC RESPONDENT NLRC DATED 30
JUNE
2003
AND
24
SEPTEMBER
2002,
WHICH
RESOLUTIONS DISMISSED PETITIONERS COMPLAINT FOR
ILLEGAL DISMISSAL BY REVERSING RESPONDENT NLRCS
PREVIOUS RESOLUTION DATED 01 FEBRUARY 2002.
II.
WHETHER OR NOT PUBLIC RESPONDENT COURT OF
APPEALS COMMITTED A REVERSIBLE ERROR WHEN IT
AFFIRMED THE SUBJECT RESOLUTIONS OF PUBLIC
RESPONDENT NLRC DISMISSING THE APPEAL FILED BY
PETITIONER AND REINSTATED THE DECISION OF LABOR
ARBITER PANGANIBAN ORDERING THE DISMISSAL OF THE
COMPLAINT
FOR
ILLEGAL
TERMINATION
NOTWITHSTANDING THE PREVIOUS RESOLUTION OF PUBLIC
RESPONDENT NLRC DATED 01 FEBRUARY 2002 DECLARING
THE ILLEGALITY OF PETITIONERS DISMISSAL FROM
EMPLOYMENT.
Calipay and the other complainants then filed a special civil action
for certiorari, with the CA assailing the September 24, 2002 and June 30,
2003 Resolutions of the NLRC.
On August 24, 2004, the CA rendered its presently disputed Decision
dismissing the abovementioned petition for certiorari.
III.
WHETHER OR NOT SUBSTANTIAL JUSTICE WAS UNDULY
COMPROMISED WHEN PUBLIC RESPONDENT COURT OF
APPEALS AFFIRMED NLRCS DISMISSAL OF PETITIONERS
APPEAL DATED 06 SEPTEMBER 2000 AND RULED AGAINST
PETITIONERS COMPLAINT FOR ILLEGAL DISMISSAL BASED
SOLELY ON TECHNICAL RULES OF PROCEDURE WHEN THE
SAME SHOULD HAVE BEEN RELAXED TO GIVE WAY TO
MERITORIOUS AND JUDICIOUS CASES SUCH AS THIS
INVOLVING DISMISSAL FROM WORK OF AN EMPLOYEE. [10]
267
timely file his appeal with the NLRC, considering that his former counsel
an appeal within the prescribed period, so does the winner also have the
suddenly and unexpectedly withdrew his services at the time that said
counsel should have been preparing his appeal, leaving petitioner without
anyone to help him prepare his appeal on time. Petitioner avers that in a
number of cases, this Court allowed the late filing of an appeal where such
appeal by a dismissed worker is, like in the present case, impressed with
the interest of substantial justice. [21] This Court may deign to veer away
from the general rule if, on its face, the appeal appears to be absolutely
meritorious.[22] Indeed, in a number of instances, procedural rules are
It bears to reiterate the settled rule that the timely perfection of an appeal
Hence, parties who seek to avail themselves of it must comply with the
statutes or rules allowing it. [15] The requirements for perfecting an appeal
within the reglementary period specified in law must, as a rule, be strictly
followed.[16] Such requirements are considered indispensable interdictions
against needless delays and are necessary for the orderly discharge of the
judicial business.[17] Furthermore, the perfection of an appeal in the manner
and within the period permitted by law is not only mandatory, but also
jurisdictional.[18] Failure to perfect the appeal renders the judgment of the
court final and executory.[19] Just as a losing party has the privilege to file
268
Resolution dated September 24, 2002, the NLRC reversed itself and
reinstated the Decision of the Labor Arbiter dismissing the complaint filed
of the case, would show that on its merits, the present petition should still
fail.
A perusal of the assailed Decision of the CA would readily confirm that the
appellate courts dismissal of the petition filed by herein petitioner was not
based solely on procedural or technical grounds. Thus, the CA held:
Be that as it may, even if We would set aside the
technicalities in the interest of substantial justice as
proffered by petitioner Calipay that the belated filing of his
appeal should nevertheless be considered in order to
completely resolve the case on its merits, We opine that
the instant case would likewise fail.
We agree with the Labor Arbiters finding that petitioner
Calipay had abandoned his work. x x x
In the instant case, petitioner Calipay had failed to report
for work for unknown reasons x x x His continued absences
without the private respondents approval constituted gross
and habitual neglect which is a just cause for termination
under Article 282 of the Labor Code of the Philippines. [24]
Petitioner harps on the fact that on February 1, 2002, the NLRC issued a
already terminated. However, they did not present any evidence to prove
Resolution which was in his favor. While petitioner relies heavily on the said
their allegation. On the other hand, as held by the Labor Arbiter, private
269
respondents were able to present the DTRs and Salary Vouchers of Calipay
reinstatement. This
is
an
indication
that
petitioner
and
the
other
and the other complainants showing that they indeed reported for work
even after their alleged termination from employment. [26] Calipay and the
fact, there is no evidence to prove that petitioner and his former co-
that they were forced to sign blank forms of their DTRs and Salary
from employment.
Vouchers.
On the other hand, private respondents were able to present
Indeed, if petitioner was dismissed, as he claims, on May 27, 1998,
why did the DTRs and Salary Vouchers presented by private respondents
show
absence,
that
he
continued
to
receive
wages
until October
31,
with
warning
that
their
failure
would
be
construed
1998? Moreover, why did petitioner file his complaint for illegal dismissal
only on July 16, 1999, or more than one year after he claims to have been
illegally dismissed?
law. Private
respondents
compliance
with
said
requirements,
taken
that the filing of the complaint for illegal dismissal appears only as a
convenient
afterthought
on
the
part
of
petitioner
and
the
other
Finally, it bears to point out that the Decision of the Labor Arbiter
was affirmed by the NLRC and the CA. The settled rule is that the factual
findings of the Labor Arbiter and the NLRC, especially when affirmed by the
CA, are accorded not only great respect but also finality, and are deemed
[27]
In the
present case, however, petitioner filed his complaint more than one year
WHEREFORE,
fact that in the complaint form which they personally filled up and filed
Resolution of the Court of Appeals, dated August 24, 2004 and December
with the NLRC, they only asked for payment of separation pay and other
monetary claims. They did not ask for reinstatement. It is only in their
Position Paper later prepared by their counsel that they asked for
SO ORDERED.
the
petition
is DENIED. The
assailed
Decision
and
270
Present:
CARPIO, J.,
Chairperson,
BRION,
PEREZ,
SERENO, and
REYES, JJ.
- versus -
Promulgated:
JAN CARLO GALA,
Respondent.
March 7, 2012
x------------------------------------------------------------------------------------x
DECISION
BRION, J.:
The Antecedents
271
foremen as they were seen conversing with him. Llanes boarded the
trucks, without being stopped, and took out what were later found as
electrical supplies. Aside from Gala, the foremen and the other linemen
who were at the worksite when the pilferage happened were later charged
Unknown to Gala and the rest of the crew, a Meralco surveillance task force
was monitoring their activities and recording everything with a Sony video
camera. The task force was composed of Joseph Aguilar, Ariel Dola and
On July 27, 2006, barely four months on the job, Gala was dismissed for
Frederick Riano.
at the Pacheco Subdivision in Valenzuela City. Gala and the other linemen
were directed to join Truck No. 1891, under the supervision of Foreman
in what they did. He claimed that: (1) he was at some distance away from
Nemecio Hipolito.
the trucks when the pilferage happened; (2) he did not have an inkling that
an illegal activity was taking place since his supervisors were conversing
When they arrived at the worksite, Gala and the other workers saw that
with Llanes, giving him the impression that they knew him; (3) he did not
Truck No. 1837, supervised by Zuiga, was already there. The linemen of
Truck No. 1837 were already at work. Gala and the other members of the
crew of Truck No. 1891 were instructed to help in the digging of a hole for
connection with his work and had no control in the disposition of company
supplies and materials. He maintained that his mere presence at the scene
of the incident was not sufficient to hold him liable as a conspirator.
While the Meralco crew was at work, one Noberto Bing Llanes, a nonMeralco employee, arrived. He appeared to be known to the Meralco
272
The CA Decision
lack of merit and partially granted Galas petition. It concurred with the
NLRC that Gala had been illegally dismissed, a ruling that was supported
Castillon-Lora dismissed the complaint for lack of merit. She held that
affidavit[10] of the members of Meralcos task force testifying that Gala and
reinstatement with full backwages and other benefits. The CA also denied
decision
Meralcos motion for reconsideration. Hence, the present petition for review
of May
2,
2008,[7] the
NLRC
reversed
the
labor
arbiters
ruling. It found that Gala had beenillegally dismissed, since there was no
on certiorari.[12]
The NLRC, however, ruled out Galas reinstatement, stating that his
The Petition
tenure lasted only up to the end of his probationary period. It awarded him
backwages and attorneys fees.
The petition is anchored on the ground that the CA seriously erred and
gravely abused its discretion in -
Both parties moved for partial reconsideration; Gala, on the ground that he
should have been reinstated with full backwages, damages and interests;
1.
and Meralco, on the ground that the NLRC erred in finding that Gala had
2.
been illegally dismissed. The NLRC denied the motions. Relying on the
same grounds, Gala and Meralco elevated the case to the CA through a
petition for certiorari under Rule 65 of the Rules of Court.
status.
273
Meralco faults the CA for not giving credit to its witnesses Aguilar,
Dola and Riano, and instead treated their joint affidavit (Samasamang
participation in, the pilferage activities done by their group, the company
Sinumpaang
participation
in the pilferage of company property on May 25, 2006. It submits that the
employee for his failure to meet the basic standards for his regularization.
The standards, it points out, were duly explained to him and outlined in his
the incident during their day-long surveillance on May 25, 2006. It points
the
to Aguilar, Dola and Riano, the trucks crew, including Gala, was familiar
was entitled to just his backwages for the unexpired portion of his
Meralco
Galas Case
own
By way of his Comment (to the Petition) dated September 2, 2010, [15] Gala
testimony[13] that he had been familiar with Llanes even before the May 25,
asks for a denial of the petition because of (1) serious and fatal infirmities
2006 incident where he saw Zuiga, the foreman of Truck No. 1837,
demonstrating
maintains
his
feigned
that
Gala
himself
admitted
in
highlights
his
his
guilt,
pilfering company property; Gala neither intervened to stop Llanes, nor did
274
trucks, he was not aware that a wrongdoing was being committed or was
With respect to the merits of the case, Gala bewails Meralcos reliance on
the joint affidavit[16] of Aguilar, Dola and Riano not only because it was
a hole. He presumed at the time that his own superiors, being the more
senior employees, could be trusted to protect company property.
presented for the first time on appeal to the CA, but also because it was a
mere afterthought. He explains that Aguilar and Dola were the very same
Finally, Gala posits that his reinstatement with full backwages is but a
dated July 7, 2006. This earlier statement did not even mention Gala, but
the later joint affidavit splashes GALAs name in a desperate attempt to link
pilferage committed prior to May 25, 2006 by his superiors were not
established, for even the labor arbiter did not make a finding on the
contain the details of the Community Tax Certificates of the affiants, and
that the lawyers who signed the petition failed to indicate their updated
Gala further submits that even if he saw Llanes on May 25, 2006 at about
the time of the occurrence of the pilferage near or around the Meralco
275
legislation that the NLRC and the labor arbiters shall use every reasonable
means to ascertain the facts in each case speedily and objectively, without
in the incident and that he was not aware that an illegal activity was going
on as he was at some distance from the trucks when the alleged theft was
being committed. He adds that he did not call the attention of the foremen
because he was a mere lineman and he was focused on what he was doing
view of the conflict between the findings of the labor arbiter, on the one
at the time. He argues that in any event, his mere presence in the area
hand, and the NLRC and the CA, on the other. As we said in S.S. Ventures
pilferage.
measured in accordance with the standards (i.e., the terms and conditions)
laid down in his probationary employment agreement. [22] Under paragraph
8 of the agreement, he was subject to strict compliance with, and nonviolation of the Company Code on Employee Discipline, Safety Code, rules
and regulations and existing policies. Par. 10 required him to observe at all
unfit to continue his employment with the company. Gala was found, after
expected of him to become a regular employee and this failure was mainly
due to his undeniable knowledge, if not participation, in the pilferage
interests.[21]
not only on May 25, 2006that Llanes, the pilferer, had been seen during a
Meralco operation. He had been previously noticed by Meralco employees,
276
including Gala (based on his admission), [23] in past operations. If Gala had
question:
what
was
he
doing
there?
Apparently,
he
had
been
incredulous for him to say that he did not know why Llanes was there or
what Zuiga and Llanes were talking about. To our mind, the Meralco crew
picking up unused supplies and materials that were not returned to the
(the foremen and the linemen) allowed or could have even asked Llanes to
company. From these factual premises, it is not hard to conclude that this
be there during their operations for one and only purpose to serve as their
activity was for the mutual pecuniary benefit of himself and the crew who
tolerated the practice. For one working at the scene who had seen or who
Meralco worksites.
who had been present in Meralco field operations, does not contradict at all
but rather support the Meralco submission that there had been reported
We consider, too, and we find credible the company submission that the
Meralco
crew
who
worked
at
the
Pacheco
Subdivision
before May 25, 2006. Gala downplays this particular point with the
in Valenzuela City on May 25, 2006 had not been returning unused supplies
argument that the labor arbiter made no such finding as she merely
and materials, to the prejudice of the company. From all these, the
assumed it to be a fact, [24] her only basis being the statement that may
With respect to the video footage of the May 25, 2006 incident,
Gala himself admitted that he viewed the tape during the administrative
wonders why Meralcos supposed video footage of the incident on May 25,
The established fact that Llanes, a non-Meralco employee, was often seen
fact that the video was shown to Gala indicates that the video was not an
evidence that Meralco was trying to suppress. Gala could have, if he had
reasons connected with the ongoing company operations, gives rise to the
wanted to, served a subpoena for the production of the video footage as
277
evidence. The fact that he did not does not strengthen his case nor weaken
the case of Meralco.
For ignoring the evidence in this case, the NLRC committed grave abuse
of discretion and, in sustaining the NLRC, the CA committed a reversible
error.
WHEREFORE,
premises
considered,
the
petition
is GRANTED. The
assailed decision and resolution of the Court of Appeals are SET ASIDE.
The complaint is DISMISSEDfor lack of merit.
SO ORDERED.
278
- versus -
Present:
CARPIO, J.,
Chairperson,
BRION,
PEREZ,
SERENO, and
REYES, JJ.
The
assailed
resolution
denied
the
petitioners'
Motion
for
Antecedent Facts
Petitioner Blue Sky Trading Company, Inc. (Blue Sky) is a duly registered
domestic corporation engaged in the importation and sale of medical
Promulgated:
supplies and equipment. Petitioner Jose G. Tantiansu, Jr. (Jose) is Blue Sky's
March 7, 2012
x----------------------------------------------------------------------------------------x
and Joseph D. Silvano (Joseph) were regular employees of Blue Sky and
they respectively held the positions of stock clerk and warehouse helper
DECISION
REYES, J.:
supervisor, wrote Jose a memorandum [6] informing the latter that six pairs
The Case
of Court assailing the October 26, 2009 Decision[2] and the December 14,
2009 Resolution[3] of the Court of Appeals (CA) in CA G.R. SP No. 108432.
The dispositive portion of the assailed decision reads:
279
On
February
suspension
[9]
3,
2005,
Jean
issued
notices
to
explain/preventive
On
the
other
hand,
Joseph
proffered
the
following
explanation:
On
February
4,
2005,
Arlene
submitted
to
Jean
handwritten
Jayde and Wilfredo also filed their written explanations denying any
involvement in the theft which took place and professing their dedication
280
order.
dismissal and for payment of ECOLA and overtime pay based on the
and Wilfredo.
following grounds:
[14]
On February 8, 2005, Arlene, Joseph, Helario, Jayde and Wilfredo filed with
the National Labor Relations Commission (NLRC) a complaint for illegal
dismissal and suspension, underpayment of overtime pay, and nonpayment of emergency cost of living allowance (ECOLA), with prayers for
reinstatement and payment of full backwages. The complaint was
docketed as NLRC NCR Case No. 00-02-01351-05.
[15]
On May 2005, before the complaint which was filed with the NLRC can be
resolved,
desistance
Helario,
[16]
Jayde
and
Wilfredo
executed
affidavits
of
actual
breach
of
duty
281
xxx
The basis, for the dismissal of the complainants, is the fact
that six (6) pairs of assorted sizes of Intensifying Screen of
the company at the bodega were lost x x x.
An entrapment was conducted against Tano-an [Jayde] and
Adonis [Helario] x x x:
xxx
Simply put, the contention, about the missing items or
supplies, is credible and reliable.
It is not necessary that proof of taking or conspiracy must
exist.
The existence of the fact, that items or supplies were
missing at the bodega of the company, would suffice to
prove loss of confidence.
Complainants failed in their duties to exercise utmost
protection, care, or custody of respondent's property.
Hence, their dismissal from the service is warranted.
xxx
Claims for ECOLA and overtime pay were not discussed by
the complainants[,] hence, they should be denied.[17]
Arlene and Joseph assailed before the NLRC the decision rendered by LA
Demaisip.[18]
On November 29, 2007, the NLRC ordered the reinstatement of Arlene and
Joseph and the payment to them of full backwages and ten percent
attorney's fees. The decision, in part, reads:
[T]he respondents [Blue Sky, Jose and Linda] accused
complainants [Arlene and Joseph] of theft of company
282
Claiming that their relations with Blue Sky had been strained, Arlene and
Joseph sought the payment of separation pay, in lieu of reinstatement.
Further, they lamented that the NLRC failed to specifically address the
issue relative to their monetary claims. Hence, they reiterated the said
claims, in addition to service incentive leave and 13 th month pay for the
year 2005, arguing that the burden to prove payment of benefits pertained
support its claim that Arlene and Joseph participated in, or at the least
xxx
On the other hand, Blue Sky averred that substantial evidence existed to
On January 30, 2009, the NLRC issued a resolution reversing its earlier
decision and reinstating LA Demaisip's dismissal of the complaint filed by
Arlene and Joseph on the basis of the following:
In our Decision promulgated on November 29, 2007, we
advanced the view that complainants Blas [Arlene] and
Silvano [Joseph] were ordinary employees not occupying
positions of trust, without however taking a profound
appreciation of the fact that complainants' duties as stock
clerk and warehouse helper routinely involved having
unlimited access to company's properties and stocks. The
fact that same properties which were subject of losses and
Aggrieved,
Arlene
and
Joseph
filed
before
the
CA
Petition
for Certiorari[22] under Rule 65 of the Rules of Court to challenge the above
quoted NLRC resolution.
283
284
former
co-workers
Tano-an
and
Adonis,
thievery
or
losses
of
company's property could not have
been committed. x x x
beyond
reasonable
doubt
of
the
employee's
misconduct
or
xxx
that there is substantial basis for loss of trust. Thus, an employer should
instant petition.
It is immaterial that Arlene and Joseph were not among those who were
The Issues
screens dictated Arlene and Joseph's liabilities. Arlene's daily work routine
involved (a) receiving and releasing of stocks; and (b) preparing stock
cards
for purposes of checking and monitoring the items in the warehouse. On
the other hand, Joseph carried and moved stocks in and out of the
warehouse. The six intensifying screens were discovered missing while
Arlene, Joseph, Helario, Jayde and Wilfredo were supposedly performing
their tasks, hence, the logical inference that they conspired to commit the
theft or at least, knowingly allowed it to happen. Had the employees
exercised due or even ordinary diligence to protect company property, no
loss would have been incurred. Further, the defense interposed by Arlene
in her written explanation that she was not employed by Blue Sky as a
security guard, showed her utter lack of concern for the company's
285
Findings of fact of quasi-judicial agencies, like the NLRC, are accorded not
only respect but even finality when they are supported by substantial
evidence.
law raised against the assailed CA decision. [29] Further, the Court is
[27]
Thus, the CA erred when it ruled that the NLRC gravely abused
generally bound by the CA's factual findings. The foregoing rules, however,
admit of exceptions, among which is when the CA's findings are contrary to
under the aforementioned exception as the LA, NLRC and the CA were at
of Court to argue that only questions of law can be raised in a petition for
Substantial evidence of
actual breach by an
employee is required
from an employer to be
able
to
justify
the
former's dismissal from
service on the basis of
an alleged participation
in theft of company
property. However, in
the case at bar, Blue Sky
had failed to discharge
the burden of proof
imposed upon it.
We note that the petitioners essentially raise the sole question of whether
they had proven by substantial evidence the charges of theft against
Arlene and Joseph which led to the latter's termination from service on the
ground of loss of trust and confidence.
286
warehouse helper, had free access to the missing items. Arlene, who kept
the stock cards, was supposed to be monitoring on a daily basis the
We note that the parties disagree as to what tasks were actually and
Further, in Baron v. NLRC,
regularly performed by Arlene and Joseph. They are at odds as to the issue
based on loss of trust and confidence, the breach of trust must be willful,
of whether or not Arlene and Joseph had custody of the missing screens.
justifiable excuse.
[32]
evidence and not proof beyond reasonable doubt is required to justify the
by Blue Sky, which were annexed to the respondents' position paper filed
with the LA, indicated that Arlene was assigned at the customer service
property. However, we find no error in the CA's findings that the petitioners
had not adequately proven by substantial evidence that Arlene and Joseph
indeed participated or cooperated in the commission of theft relative to the
287
their complaints for illegal dismissal against the company. Arlene and
The petitioners also argue that if Arlene and Joseph had not been grossly
negligent in the performance of their duties, Blue Sky would not have
incurred the loss. We observe though that in the notices sent to Arlene and
Joseph, first charging them with theft, and later, informing them of their
paper filed before the LA, the former alleged that in a letter, Jayde, Helario
ground. Hence, Arlene and Joseph could not have defended themselves
[34]
allegation was bare since the letter supposedly written by Jayde, Helario
and Wilfredo was not offered as evidence. Further, Blue Sky alleged that
Only the following had been established without dispute: (a) the fact of loss
the ultrasound probe was among the items found missing in the inventory
belonged to Blue Sky; and (c) Jayde, Helario and Wilfredo filed their
ultrasound probe.
In its November 29, 2007 Decision, the NLRC found that Arlene and Joseph,
a stock clerk and a warehouse helper, respectively, did not have unlimited
for. Further, Arlene and Joseph claimed that it was Lorna who had control
access to or custody over Blue Sky's property. The CA, in the decision and
and custody of the stocks as she was the warehouse supervisor. Boy and
Lorna were not called upon by either of the parties to corroborate their
November 29, 2007 NLRC Decision, found that Arlene and Joseph exercised
claims. Boy and Lorna could have provided important information as to the
time line and the manner the intensifying screens were lost. If Boy and
nature of Arlene and Joseph's regular duties while under Blue Sky's employ
better position to require the two to execute affidavits relative to what they
Joseph had actual custody over company property, we agree with the CA
that the petitioners had failed to establish by substantial evidence the
charges which led to Arlene and Joseph's dismissal from service.
288
[35]
case succeeds or fails on the strength of its evidence and not on the
In Arlene and Joseph's case, Blue Sky issued to them notices to explain on
February 3, 2005. They submitted their written explanation the day after
that the scales of justice should be tilted in favor of the latter in case of
not agree with Blue Sky's subsequent decision to terminate them from
service, we find no impropriety in its act of imposing preventive suspension
Notwithstanding our affirmation of the CA's finding that the petitioners had
upon the respondents since the period did not exceed the maximum
failed to discharge the burden of proof imposed upon them to justify the
imposed by law and there was a valid purpose for the same.
We, however, find no merit in the challenge made by Arlene and Joseph
against the legality of the preventive suspension imposed by Blue Sky
upon them pending the investigation of the alleged theft.
In lieu of reinstatement,
Arlene and Joseph are
entitled to an award of
separation pay.
In the case at bar, Arlene and Joseph were dismissed from service on
February 5, 2005. We find that the lapse of more than seven years already
renders their reinstatement impracticable. Further, from the stubborn
stances of the parties, to wit, the petitioners' insistence that dismissal was
valid on one hand, and the respondents' express prayer for the payment of
289
[38]
We find nothing in the records to indicate that the petitioners had indeed
In the case at bar, albeit we find Arlene and Joseph's dismissal from service
as illegal, we cannot attribute bad faith on the part of Blue Sky which
merely acted with an intent to protect its interest. Hence, we find as
In the resolution issued on January 30, 2009, the NLRC found proof by way
lacking in basis the NLRC's award of ten percent attorney's fees in the
of the petitioners' annex to their position paper that Arlene and Joseph
respondents' favor.
already received their 13 month and service incentive leave pay for the
th
year 2005.[39] The respondents had not specifically refuted the NLRC's
findings, hence, we sustain the same.
Anent the respondents' claim for overtime pay, we find no ample basis to
grant it as they had not offered any proof to show that they in fact
rendered such service.
As a general rule, a corporate officer cannot be held liable for acts done in
his official capacity because a corporation, by legal fiction, has a
290
(a) Blue Sky is directed to pay ECOLA and separation pay to the
respondents;
(b) The award in favor of the respondents of ten percent attorney's fees
made by the National Labor Relations Commission in its November 29,
2007 Decision and which was affirmed by the Court of Appeals in the
herein assailed decision and resolution is deleted; and
to
awarded in
accordance with this Decision and to submit its compliance thereon within
thirty (30) days from notice hereof.
SO ORDERED.
291
- versus -
Present:
CARPIO, J.,
Chairperson,
BRION,
PEREZ,
SERENO, and
REYES, JJ.
Promulgated:
report directly to the Chief Operations Officer, Annie Llamanzares Abad. His
tasks involved principally the review of the clients applications for
immigration to Canada to ensure that they are in accordance with
February 6, 2012
x------------------------------------------------------------------------------------x
DECISION
BRION, J.:
following reasons:
a)
b)
c)
For resolution is the petition for review on certiorari[1] to nullify the decision
dated December 19, 2005 [2] and the resolution dated March 30, 2006 [3] of
the Court of Appeals (CA) rendered in CA-G.R. SP No. 84907.
The Antecedents
d)
fostering
Dalangins submission
292
could not keep in his company people who are hard-headed and who
onwards. He inquired from Abad about the subject and purpose of the
refuse to follow orders from management.[9] Sichani also told him that since
seminar and when he learned that it bore no relation to his duties, he told
Abad that he would not attend the seminar. He said that he would have to
any time and at will. Sichani refused to accept his letter-reply to the
leave at 2:00 p.m. in order to be with his family in the province. Dalangin
company memorandum dated October 26, 2001 and instead told him to
claimed that Abad insisted that he attend the seminar so that the other
Through their position paper,[10] the company and its principal officers
Dalangin further alleged that Abad refused his request and stressed that all
Saturdays which she considered still part of office hours. Under his
results of his work; on his attitude towards the company, his work and his
employment contract,
co-employees, as spelled out in his job description; [11] and on the basis of
[7]
Abads affidavit.[12]
They further alleged that during his brief employment in the company,
made to stay in the office beyond office hours, except under circumstances
Dalangin showed lack of enthusiasm towards his work and was indifferent
On
October
lunch breaks, exceeding the one hour allotted to employees, and leaving
seminar scheduled for October 27, 2001 and the other forthcoming
call the office later and say that he would be unable to return because he
seminars. The following day, October 27, 2001, Abad informed him that Mr.
Yadi N. Sichani, the companys Managing Director, wanted to meet with him
interpersonal
hear from Sichani that his services were being terminated because Sichani
memorandum
26,
[8]
2001,
Dalangin
claimed
that
Abad
issued
skills
and
initiative
which
he
manifested
when
the
293
Tecson; he also should have found a way to appeal her denied application,
but he did not. As it turned out, the explanation he gave to Tecson led her
The CA Decision
to believe that the company did not handle her application well. Dalangins
lack of interest in the company was further manifested when he refused to
In its now assailed decision, [15] the CA held that the NLRC erred when it
ruled that Dalangin was not illegally dismissed. As the labor arbiter did, the
CA found that the company failed to support, with substantial evidence, its
claim that Dalangin failed to meet the standards to qualify as a regular
The company argued that since Dalangin failed to qualify for the position of
employee.
Citing a ruling of the Court in an earlier case, [16] the CA pointed out that the
to
meet
the
reasonable
standards
for
his
regular
In his decision dated April 23, 2003,[13] Labor Arbiter Eduardo G. Magno
declared
[17]
Dalangins
dismissal
illegal,
and
awarded
him
backwages
charges against Dalangin, which led to his dismissal, were not established
Through
Memorandum
the following issues: (1) whether the requirements of notice and hearing in
moved for reconsideration, but the NLRC denied the motion, prompting him
its
[21]
submissions
the
Petition,[19] the
Reply[20] and
the
294
On the first issue, the company argues that the notice and hearing
existing laws and jurisprudence, are entitled to notice and hearing prior to
dismissal, it maintains, was not based on a just cause under Article 282,
but was due to his failure to meet the companys standards for regular
Dalangin disputes the companys submission that under the Labor Codes
clearly mandate the employer to (1) serve the employee a written notice
and (2) within a reasonable time before effecting the dismissal. He stresses
served the employee within a reasonable time from the effective date of
termination.[22] It
hand.
points
out
that
it
properly
observed
the
notice
He explains that in the present case, the company did not observe the
why he could not attend the seminar scheduled for October 27, 2001;
above two requirements as he was dismissed the day after he was asked,
Dalangin failed to submit his explanation. It posits that contrary to the CAs
twenty-four hours why he could not attend the October 27, 2001 seminar.
With respect to the second issue, the company submits that Dalangin is
27, 2001 refers to the written notice contemplated under the rules, still the
good faith with the belief that he would not contribute any good to the
dismissal reveals that none of the charges leveled against him is supported
by concrete and tangible evidence. He maintains that the company
and defied. He refutes the companys claim that his job description and his
[24]
and Memorandum,
[25]
295
As a rule, the Court is not a trier of facts, the resolution of factual issues
companys general averments regarding his failure to meet its standards for
being the function of lower courts whose findings are received with respect
and are binding on the Court subject to certain exceptions. [30] A recognized
damages, as well as attorneys fees, claiming that his dismissal was unjust,
factual findings of the NLRC on the dispute between Dalangin and the
oppressive, tainted with bad faith, and contrary to existing morals, good
company are at variance with those of the CA, thus necessitating our
customs and public policy. There was bad faith, he argues, because he was
dismissed without the requisite notice and hearing required under the law;
and merely on the basis of the companys bare, sweeping and general
We
now
resolve
the
core
issue
of
whether
Dalangin,
his rights.
latter
employment.
prepared two memoranda, both dated October 26, 2001, one is the memo
[28]
determines
A
whether
or
probationary
not
he
is
appointment
qualified
gives
the
for
permanent
employer
an
Sichani, recommending his dismissal. [29] He was surprised that Sichani did
Dalangin was barely a month on the job when the company terminated his
not bother to ask Abad why she gave him two conflicting memos on the
proper and efficient employee or, as the company put it, he was unfit and
circumstances on the matter nor did they give him the opportunity to
296
Dalangins dismissal was viewed differently by the NLRC and the CA. The
NLRC upheld the dismissal as it was, it declared, in the exercise of the
companys management prerogative. On the other hand, the CA found that
the dismissal was not supported by substantial evidence and that the
company did not allow Dalangin to prove that he had the qualifications to
meet the companys standards for his regular employment. The CA did not
believe that the company could fully assess Dalangins performance within
the purpose of the term or period, but not its length. [34] Thus, the fact that
Dalangin was separated from the service after only about four weeks does
company had very little time to determine his fitness for the job.
not necessarily mean that his separation from the service is without basis.
We disagree.
the purpose or objective of both the employer and the employee during
the period. While the employer observes the fitness, propriety and
offered glimpses of his own behavior and actuations during his four-week
employment.
stay with the company; he betrayed his negative attitude and regard for
[33]
(6) months under Article 281 of the Labor Code, unless it is covered by an
cause for his dismissal was his refusal to attend the companys Values
to attend the seminar after he learned that it had no relation to his duties,
as he claimed, and that he had to leave at 2:00 p.m. because he wanted to
be with his family in the province. When Abad insisted that he attend the
seminar to encourage his co-employees to attend, he stood pat on not
attending, arguing that marked differences exist between their positions
297
and duties, and insinuating that he did not want to join the other
negative working habits, particularly with respect to the one hour lunch
break policy of the company and the observance of the companys working
beyond 2:00 p.m. He considers 2:00 p.m. as the close of working hours on
hours. Thus, Abad stated that Dalangin would take prolonged lunch breaks
or would go out of the office without leave of the company only to call the
the law.
kind of person and employee Dalangin was. His refusal to attend the
seminar brings into focus and validates what was wrong with him, as Abad
narrated in her affidavit [36] and as reflected in the termination of
employment
memorandum.
[37]
familiarizing
himself with
the
Significantly,
the
seminar
It
highlights
companys
involved
his
lack
objectives
acquainting
and
of
interest
and
in
policies.
updating
the
Abads insinuation that he was not doing his job well, with the ready
argument that the company did not even bother to present Tecsons
testimony.
In the face of Abads direct statements, as well as those of his coemployees, it is puzzling that Dalangin chose to be silent about the
charges, other than saying that the company could not cite any policy he
good working relationship with his co-employees, especially the rank and
violated. All along, he had been complaining that he was not able to
file; he did not want to join them because of his view that the seminar was
explain his side, yet from the labor arbiters level, all the way to this Court,
not relevant to his position and duties. It also betrays an arrogant and
298
that the company had seen enough from Dalangins actuations, behavior
We, therefore, disagree with the CA that the company could not
The records support Dalangins contention. The notice served on him did
have fully determined Dalangins performance barely one month into his
not give him a reasonable time, from the effective date of his separation,
employment.
Migration
as required by the rules. He was dismissed on the very day the notice was
Commission, the probationary term or period denotes its purpose but not
given to him, or, on October 27, 2001. Although we cannot invalidate his
its length. To our mind, four weeks was enough for the company to assess
dismissal in light of the valid cause for his separation, the companys non-
Dalangins fitness for the job and he was found wanting. In separating
Dalangin from the service before the situation got worse, we find
[40]
As
we
said
inInternational
Catholic
Finally, given the valid reason for Dalangins dismissal, the claim for moral
and exemplary damages, as well as attorneys fees, must necessarily fail.
The company contends that it complied with the above rule when it asked
Dalangin, through Abads Memorandum dated October 26, 2001, [39] to
explain why he could not attend the seminar scheduled for October 27,
299
300
301
_____________
P 422,188.00
302
303
workers resulted in the latters untimely separation from the service not to
their own liking, hence, not construable as resignation. [7] Resignation must
be voluntary and made with the intention of relinquishing the office,
accompanied with an act of relinquishment.[8] Indeed, it would have been
illogical for private respondents herein to resign and then file a complaint
for illegal dismissal. Resignation is inconsistent with the filing of the said
complaint.[9]
As to petitioners assertion that private respondents resorted to forum
shopping, the same deserves scant consideration. As noted by the Solicitor
General, private respondents claims in this case are based on
underpayment of wages, legal holiday pay, service incentive leave pay and
13th month pay. On the other hand, the other cases separately filed in
different fora by Danilo Canares, Aurelia Gabucan, Dexter Mitschek and
Ruel Viray involved different issues which are distinct and have no bearing
on the case at bar.[10] The case pursued by Canares is for diminution of
salary on account of his demotion which was decided in his favor with
finality by this Court;[11] Gabucans case involves reinstatement to her job;
Mitscheks case pertains to diminution of his salary; and Virays complaint
was dismissed without prejudice for failure to prosecute. Thus, there is no
basis for petitioners forum shopping charge as the instant case and the
others do not raise identical causes of action, subject matter and issues. [12]
Lastly, petitioner alleges that claims of other private respondents have
already been paid upon the enforcement of the order dated February 26,
1992 in case number NRC-00-9112-CI-001. This is not correct. As correctly
pointed out by the Solicitor General, the aforesaid order refers to the
enforcement of Wage Order No. NCR-02 mandating P2.00 wage increase.
[13]
Certainly, the wage differential received by private respondents by
virtue of the mandated wage increase is different from the monetary
benefits herein being claimed by private respondents. Hence, public
respondent cannot be faulted for grave abuse of discretion on this score.
WHEREFORE, the instant petition is DENIED, and the assailed
RESOLUTIONS of public respondent are AFFIRMED. Costs against petitioner.
SO ORDERED.
304
In the Decision dated May 7, 2004, the Labor Arbiter (LA) declared the
petitioners to have been illegally dismissed, among others. According to
the LA, the respondents alleged losses were not serious as its financial
statements even showed a net surplus. Thus, the LA ordered the
respondent to pay the petitioners separation pay in lieu of reinstatement,
plus attorneys fees.5
The dispositive portion of the LA Decision provides:
DECISION
REYES, J.:
This is a petition for review assailing the Decision 1 dated November 19,
2008 of the Court of Appeals (CA) and the Resolution dated March 25, 2009
denying the motion for reconsideration thereof in CA-G.R. SP No. 02237.
Facts
The petitioners were elementary and high school academic and nonacademic personnel employed by Mount Carmel College (respondent),
located in New Escalante, Negros Occidental. In April 1999, the petitioners
were informed of their retrenchment by the respondent due to the closure
of the elementary and high school departments of the school. The
petitioners contend that such closure was merely a subterfuge of their
termination due to their union activities. According to the petitioners, they
organized a union in 1997 (Mount Carmel College Employees Union
[MCCEU]), and were in the process of negotiating with the respondent as
regards their collective bargaining agreement when the respondent
decided to close the two departments in June 1999. 2 The petitioners
alleged that such closure was motivated by ill-will just to get rid of the
petitioners who were all union members because in June 2001, the school
re-opened its elementary and high school departments with newly-hired
teachers. They claimed for the remaining separation pay differentials
since what they received was only computed at 15 days for every year of
service when they were retrenched.3
The respondent, on the other hand, denied committing any act of unfair
labor practice and alleged that their retrenchment was valid as it was due
to the financial losses it suffered as result of a decline in its enrolment.
The respondent claimed that as it was, the expenses for its academic and
non-academic personnel were already eating into its budget portion
allocated for capital and administrative development, and that the
teachers demand for increased salaries and benefits, coupled with the
decline in the enrolment, left the school with no choice but to close down
its grade school and high school departments.4
2.
3.
4.
305
which, it turned out, was blacklisted at that time (March 15, 2004); and
since CBIC was already included in the list of the Supreme Courts
accredited bonding companies from February 1, 2005 until July 31, 2005,
there is no more impediment for CBIC to make good its bond; and (3) the
petitioners retrenchment is an exercise by the respondent of its
management prerogative and the latters state of finances justifies the
same.7
Ruling of the Court of Appeals
In the assailed decision promulgated on November 19, 2008, the CA did
not find any grave abuse of discretion committed by the NLRC and thus,
affirmed its decision. The CA found no factual basis for the petitioners
allegation that the school closed down for purposes of union busting, and
that the school cannot be compelled to operate at a loss, as shown by its
financial statements. The CA also ruled that the respondent cannot be
compelled to re-hire the petitioners when it later re-opened as it has the
discretion in the hiring of its employees.8
The petitioners sought reconsideration of the assailed decision, which was
denied by the CA in its Resolution dated March 25, 2009. 9
II.
III.
xxxx
In case of a judgment involving a monetary award, an appeal by the
employer may be perfected only upon the posting of a cash or surety
bond issued by a reputable bonding company duly accredited by
the Commission in the amount equivalent to the monetary award in the
judgment appealed from. (Emphasis ours)
At the time of the respondents filing of its appeal from the LA decision in
2004, the rules of procedure in force was the New Rules of Procedure of the
NLRC, as amended by NLRC Resolution No. 01-02, Series of 2002, Section 6
of which provides:
Sec. 6. BOND. - In case the decision of the Labor Arbiter or the Regional
Director involves a monetary award, an appeal by the employer may be
perfected only upon the posting of a cash or surety bond. The appeal bond
shall either be in cash or surety in an amount equivalent to the monetary
award, exclusive of damages and attorneys fees.
In case of surety bond, the same shall be issued by a reputable
bonding companyduly accredited by the Commission or the
Supreme Court, and shall be accompanied by:
(a) a joint declaration under oath by the employer, his counsel, and the
306
bonding company, attesting that the bond posted is genuine, and shall be
in effect until final disposition of the case.
(b) a copy of the indemnity agreement between the employer-appellant
and bonding company; and
(c) a copy of security deposit or collateral securing the bond.
A certified true copy of the bond shall be furnished by the appellant to the
appellee who shall verify the regularity and genuineness thereof and
immediately report to the Commission any irregularity.
Upon verification by the Commission that the bond is irregular or not
genuine, the Commission shall cause the immediate dismissal of the
appeal.
xxxx
Section 6 requiring the issuance of a bond by a reputable bonding
company duly accredited by the NLRC or the Supreme Court was
substantially carried over to the 2005 Revised Rules of Procedure of the
NLRC13 and the 2011 NLRC Rules of Procedure.14 In this regard, the Court
has ruled that in a judgment involving a monetary award, the appeal shall
be perfected only upon: (1) proof of payment of the required appeal fee;
(2) posting of a cash or surety bond issued by a reputable bonding
company; and (3) filing of a memorandum of appeal.15
In this case, it was not disputed that at the time CBIC issued the appeal
bond, it was already blacklisted by the NLRC. The latter, however, opined
that respondents should not be faulted if the Bacolod branch office of the
bonding company issued the surety bond and that [r]espondents acted
in good faith when they transacted with the bonding company for the
issuance of the surety bond.16
Good faith, however, is not an excuse for setting aside the mandatory and
jurisdictional requirement of the law. In Cawaling v. Menese,17 the Court
categorically ruled that the defense of good faith does not render the
issued bond valid. The Court further ruled that
It was improper to honor the appeal bond issued by a surety company
which was no longer accredited by this Court. Having no authority to issue
judicial bonds not only does Intra Strata cease to be a reputable surety
company the bond it likewise issued was null and void.
x x x It is not within respondents discretion to allow the filing of the
appeal bond issued by a bonding company with expired accreditation
regardless of its pending application for renewal of accreditation. x x
x.18 (Emphasis ours)
The condition of posting a cash or surety bond is not a meaningless
307
half (1/2) month pay for every year of service, whichever is higher. A
fraction of at least six (6) months shall be considered one (1) whole year.
Standards25 have been laid down by the Court in order to prevent its abuse
by an employer, to wit:
(1) That retrenchment is reasonably necessary and likely to prevent
business losses which, if already incurred, are not merely de minimis,
but substantial, serious, actual and real, or if only expected, are
reasonably imminent as perceived objectively and in good faith by the
employer;
(2) That the employer served written notice both to the employees and to
the Department of Labor and Employment at least one month prior to
the intended date of retrenchment;
(3) That the employer pays the retrenched employees separation pay
equivalent to one (1) month pay or at least one-half () month pay for
every year of service, whichever is higher;
(4) That the employer exercises its prerogative to retrench employees in
good faith for the advancement of its interest and not to defeat or
circumvent the employees right to security of tenure; and
(5) That the employer used fair and reasonable criteria in ascertaining who
would be dismissed and who would be retained among the employees,
such as status, efficiency, seniority, physical fitness, age, and financial
hardship for certain workers.26 (Emphasis ours)
In the present case, the respondents justification for implementing the
retrenchment of the petitioners was due to the alleged closure or cessation
of its elementary and high school departments. According to them, the
continued operations of these departments was an exercise of
management prerogative to protect its business and it was no longer
viable to maintain the two departments as it was already being subsidized
by the college department. As proof thereof, the respondent submitted its
audited Financial Statements for the years 1997, 1998 and 1999.
Respondent also alleged that such closure was recognized by the Tuition
Fee Law, which mandates that 70% of the tuition incremental proceeds
should be allocated for salaries, wages and other benefits of its personnel.
Respondent claimed that in its case, personnel benefits are already eating
into the portion of the budget allocated for capital and administrative
development, and faced further with the demands of the employees of
additional increase in salaries and benefits, it had no choice but to close
down.27
The burden of proving that the termination of services is for a valid or
authorized cause rests upon the employer. In termination by
retrenchment, not every loss incurred or expected to be incurred by an
employer can justify retrenchment.28 The employer must prove, among
others, that the losses are substantial and that the retrenchment is
reasonably necessary to avert such losses.29 In this case, while the
respondent may have presented its Financial Statements, the respondent,
nevertheless, failed to establish with reasonable certainty that the
proportion of its revenues are largely expended for its elementary and high
school personnel salaries, wages and other benefits. Its Financial
Statements30 showed the following figures, among others:
Financial Statement
Gross Revenues
Personnel Expenses
Net Surplus
1997
1998
1999
10,529,810.39
12,603,283.12
12,438,060.00
6,273,646.00
7,199,859.58
6,688,710.32
405,091.76
769,460.93
130,681.44
308
309
about the same later, its branch supervisor in Baguio City, Delia M. Oficial,
sent to private respondent a memorandum dated January 15, 1992
requiring her to explain the discrepancy. In that memorandum, she was
reminded about the companys policy of not accepting married women for
employment.[4]
In her reply letter dated January 17, 1992, private respondent stated
that she was not aware of PT&Ts policy regarding married women at the
time, and that all along she had not deliberately hidden her true civil
status.[5] Petitioner
nonetheless
remained
unconvinced
by
her
explanations. Private respondent was dismissed from the company
effective January 29, 1992, [6] which she readily contested by initiating a
complaint for illegal dismissal, coupled with a claim for non-payment of
cost of living allowances (COLA), before the Regional Arbitration Branch of
the National Labor Relations Commission in Baguio City.
At the preliminary conference conducted in connection therewith,
private respondent volunteered the information, and this was incorporated
in the stipulation of facts between the parties, that she had failed to remit
the amount of P2,380.75 of her collections. She then executed a
promissory note for that amount in favor of petitioner. [7] All of these took
place in a formal proceeding and with the agreement of the parties and/or
their counsel.
On November 23, 1993, Labor Arbiter Irenarco R. Rimando handed
down a decision declaring that private respondent, who had already gained
the status of a regular employee, was illegally dismissed by petitioner. Her
reinstatement, plus payment of the corresponding back wages and COLA,
was correspondingly ordered, the labor arbiter being of the firmly
expressed view that the ground relied upon by petitioner in dismissing
private respondent was clearly insufficient, and that it was apparent that
she had been discriminated against on account of her having contracted
marriage in violation of company rules.
On appeal to the National Labor Relations Commission (NLRC), said
public respondent upheld the labor arbiter and, in its decision dated April
29, 1994, it ruled that private respondent had indeed been the subject of
an unjust and unlawful discrimination by her employer, PT&T. However, the
decision of the labor arbiter was modified with the qualification that Grace
de Guzman deserved to be suspended for three months in view of the
dishonest nature of her acts which should not be condoned. In all other
respects, the NLRC affirmed the decision of the labor arbiter, including the
310
Act No. 6955[13] which bans the mail-order-bride practice for a fee and the
export of female labor to countries that cannot guarantee protection to the
rights of women workers; Republic Act No. 7192, [14] also known as the
Women in Development and Nation Building Act, which affords women
equal opportunities with men to act and to enter into contracts, and for
appointment, admission, training, graduation, and commissioning in all
military or similar schools of the Armed Forces of the Philippines and the
Philippine National Police; Republic Act No. 7322[15] increasing the
maternity benefits granted to women in the private sector; Republic Act
No. 7877[16] which outlaws and punishes sexual harassment in the
workplace and in the education and training environment; and Republic Act
No. 8042,[17] or the Migrant Workers and Overseas Filipinos Act of 1995,
which prescribes as a matter of policy,inter alia, the deployment of migrant
workers, with emphasis on women, only in countries where their rights are
secure. Likewise, it would not be amiss to point out that in the Family Code,
[18]
womens rights in the field of civil law have been greatly enhanced and
expanded.
In the Labor Code, provisions governing the rights of women workers
are found in Articles 130 to 138 thereof. Article 130 involves the right
against particular kinds of night work while Article 132 ensures the right of
women to be provided with facilities and standards which the Secretary of
Labor may establish to ensure their health and safety. For purposes of
labor and social legislation, a woman working in a nightclub, cocktail
lounge, massage clinic, bar or other similar establishments shall be
considered as an employee under Article 138. Article 135, on the other
hand, recognizes a womans right against discrimination with respect to
terms and conditions of employment on account simply of sex. Finally, and
this brings us to the issue at hand, Article 136 explicitly prohibits
discrimination merely by reason of the marriage of a female employee.
3. Acknowledged as paramount in the due process scheme is the
constitutional guarantee of protection to labor and security of tenure. Thus,
an employer is required, as a conditionsine qua non prior to severance of
the employment ties of an individual under his employ, to convincingly
establish, through substantial evidence, the existence of a valid and just
cause in dispensing with the services of such employee, ones labor being
regarded as constitutionally protected property.
On the other hand, it is recognized that regulation of manpower by the
company falls within the so-called management prerogatives, which
prescriptions encompass the matter of hiring, supervision of workers, work
assignments, working methods and assignments, as well as regulations on
311
312
that supposed defalcation of company funds. That the labor arbiter would
thus consider petitioners submissions on this supposed dishonesty as a
mere afterthought, just to bolster its case for dismissal, is a perceptive
conclusion born of experience in labor cases. For, there was no showing
that private respondent deliberately misappropriated the amount or
whether her failure to remit the same was through negligence and, if so,
whether the negligence was in nature simple or grave. In fact, it was
merely agreed that private respondent execute a promissory note to
refund the same, which she did, and the matter was deemed settled as a
peripheral issue in the labor case.
This provision had a studied history for its origin can be traced to
Section 8 of Presidential Decree No. 148, [31] better known as the Women
and Child Labor Law, which amended paragraph (c), Section 12 of Republic
Act No. 679,[32] entitled An Act to Regulate the Employment of Women and
Children, to Provide Penalties for Violations Thereof, and for Other
Purposes. The forerunner to Republic Act No. 679, on the other hand, was
Act No. 3071 which became law on March 16, 1923 and which regulated
the employment of women and children in shops, factories, industrial,
agricultural, and mercantile establishments and other places of labor in the
then Philippine Islands.
313
the policy, the same was able to obtain a momentary reprieve. A close look
at Section 8 of said decree, which amended paragraph (c) of Section 12 of
Republic Act No. 679, reveals that it is exactly the same provision
reproduced verbatim in Article 136 of the Labor Code, which was
promulgated on May 1, 1974 to take effect six (6) months later, or on
November 1, 1974.
It cannot be gainsaid that, with the reiteration of the same provision in the
new Labor Code, all policies and acts against it are deemed illegal and
therefore abrogated. True, Article 132 enjoins the Secretary of Labor to
establish standards that will ensure the safety and health of women
employees and in appropriate cases shall by regulation require employers
to determine appropriate minimum standards for termination in special
occupations, such as those of flight attendants, but that is precisely the
factor that militates against the policy of respondent. The standards have
not yet been established as set forth in the first paragraph, nor has the
Secretary of Labor issued any regulation affecting flight attendants.
It is logical to presume that, in the absence of said standards or regulations
which are as yet to be established, the policy of respondent against
marriage is patently illegal. This finds support in Section 9 of the New
Constitution, which provides:
Sec. 9. The State shall afford protection to labor, promote full employment
and equality in employment, ensure equal work opportunities regardless of
sex, race, or creed, and regulate the relations between workers and
employees. The State shall assure the rights of workers to selforganization, collective bargaining, security of tenure, and just and
humane conditions of work x x x.
Moreover, we cannot agree to the respondents proposition that termination
from employment of flight attendants on account of marriage is a fair and
reasonable standard designed for their own health, safety, protection and
welfare, as no basis has been laid therefor. Actually, respondent claims that
its concern is not so much against the continued employment of the flight
attendant merely by reason of marriage as observed by the Secretary of
Labor, but rather on the consequence of marriage-pregnancy. Respondent
discussed at length in the instant appeal the supposed ill effects of
pregnancy on flight attendants in the course of their employment. We feel
that this needs no further discussion as it had been adequately explained
by the Secretary of Labor in his decision of May 2, 1976.
314
315
KAPUNAN, J.:
This petition for review on certiorari seeks to set aside the decision of
public respondent National Labor Relations Commission (NLRC) which
upheld the legality of the separation of sixty-six (66) employees who are
members of petitioner unions, thereby dismissing petitioners' complaint
against private respondents for violation of collective bargaining
agreement (CBA) and unfair labor practice.
On January 24, 1992, a notice of strike was filed by the petitioners which
accused private respondents, among others, of unfair labor practice,
violation of CBA and discrimination. Conciliation proceedings were held by
the National Conciliation and Mediation Board (NCMB) but the parties failed
to arrive at a settlement.
Private respondents Maya Farms, Inc. and Maya Realty and Livestock
Corporation belong to the Liberty Mills group of companies whose
undertakings include the operation of a meat processing plant which
produces ham, bacon, cold cuts, sausages and other meat and poultry
products.
On February 6, 1992, the two companies filed a petition with the Secretary
of Labor and Employment asking the latter to assume jurisdiction over the
case and/or certify the same for compulsory arbitration. Thus, on February
12, 1992, the then Acting Labor Secretary (now Secretary) Nieves Confesor
certified the case to herein public respondent for compulsory arbitration.
Petitioners, on the other hand, are the exclusive bargaining agents of the
employees of Maya Farms, Inc. and the Maya Realty and Livestock
Corporation.
316
the dispositive
SO ORDERED. 4
Not satisfied with the above-quoted decision, petitioners interposed the
instant petition.
Petitioners maintain that public respondent grossly erred and gravely
abused its discretion when it ruled that: (a) the termination of the sixty-six
(66) employees was in accordance with the LIFO rule in the CBA; (b) the
termination of the sixty-six (66) employees was in accordance with Article
283 of the Labor Code; and (c) the payment or offer of payment can
substitute for the 30-day required notice prior to termination. 5
A close scrutiny of these assigned errors however, shows that the same
primarily deal with the factual findings of public respondent which we are
not at liberty to set aside in the absence of grave abuse of discretion
amounting to lack or in excess of jurisdiction.
This Court has consistently ruled that findings of fact of administrative
agencies and quasi-judicial bodies which have acquired expertise because
their jurisdiction is confined to specific matters are generally accorded not
only respect but even finality 6 and are binding upon this Court unless there
is a showing of grave abuse of discretion, 7 or where it is clearly shown that
they were arrived at arbitrarily or in disregard of the evidence on record. 8
Nevertheless, we will look into the factual findings of public respondent if
only to determine whether there was grave abuse of discretion amounting
to lack or in excess of jurisdiction.
The termination of the sixty-six employees was done in accordance with
Article 283 of the Labor Code. The basis for this was the companies' study
to streamline operations so as to make them more viable. Positions which
overlapped each other, or which are in excess of the requirements of the
service, were declared redundant.
Article 283 provides:
Art. 283. Closure of establishment and reduction of
personnel. The employer may also terminate the
employment of any employee due to the installation of
labor-saving devises, redundancy, retrenchment to prevent
losses or the closing or cessation of operation of the
establishment or undertaking unless the closing is for the
317
318
319
320
SYLLABUS
1.
2.
321
of union member and union busting, by Flora Balbino, Mary Ann Macaspac,
Rossie Rejuso, Rosalie Cachucha, Lolita Geraldez, Angelina Albasin, Ma.
Luisa Balbino, Vilma Ballesteros and Carmen Balingit; the third, on 24
August 1992, for unfair labor practice and withholding of wages filed by
Deogracias Balingit; and the fourth, on 2 September 1992, for unfair labor
practice and illegal dismissal, by Gilbert Rivera and Mary Ann
Macaspac. Thereafter, the four (4) complaints had to be, as they in fact
were, consolidated.
During the pendency of these cases, Lolita Geraldez, Perlita Matias,
Mila Santos and Angelina Albasin moved that they be dropped as
complainants in view of their subsequent resignation/ separation from
employment.
The complainants alleged that in the first week of May 1992 they
organized a labor union. On 22 May 1992 Cristina Balingit, wife of the
union Chairman, was dismissed from employment as sewer. In the last
week of May union Chairman Deogracias Balingit himself was suspended
from work as knitting operator. On 1 June 1992 petitioners shortened the
number of working days of the union officers and members from six (6) to
three (3) days a week.
On 1 July 1992 the union filed a petition for certification election.
On 6 July 1992 union members Romulo Albasin, Melchor Cachucha
and George Macaspac, who worked as printers, were barred from entering
the
company
premises. On
5
August
1992
Flora
Balbino
was suspended, then on the same day terminated from her job as
sewer. On 14 August 1992 union Vice Chairman Gilbert Rivera, as artist,
was dismissed from employment together with union Secretary Mary Ann
Macaspac. On 10 September 1992 Mila Santos was suspended. The
complainants thus considered the foregoing acts as retaliatory measures of
petitioners on account of the former having established a union.
Petitioners contended that they resorted to rotation of work, which
affected practically all employees, because of the low demand for their
towels and shirts. Petitioners also avowed that they validly dismissed five
(5) of the complainants, namely, Romulo Albasin, George Macaspac, Gilbert
Rivera, Mary Ann Macaspac and Flora Balbino. According to petitioners,
Romulo Albasin and George Macaspac slashed several bundles of towels on
3 July 1992, while the positions of Gilbert Rivera and Mary Ann Macaspac
became redundant. Flora Balbino threatened the Personnel Manager and
violated company rules by removing her time card from the rack, while
322
Petitioners maintain that valid causes exist for the termination of the
five (5) complainants earlier mentioned. Romulo Albasin and George
Macaspac were caught by security guards M. Abelgas and E. Antonio
slashing with razor blades several bundles of towels in the warehouse at
about 12:30 o'clock in the afternoon of 3 July 1992. The incident, which
constituted serious misconduct, was witnessed by another employee, Jose
Arnel Mejia. Gilbert Rivera and Mary Ann Macaspac were terminated on 14
August 1992 due to redundancy, i.e., the Design Section where they
worked as artists became overmanned when the volume of work was
drastically reduced. Flora Balbino was guilty of serious misconduct by
hurling invectives at petitioner Bico and threatening him in front of several
workers, and taking her time card off the rack on 5 August 1992.
In the case of Melchor Cachucha, petitioners insist that he
unjustifiably left his employment on 7 July 1992 and refused to return to
work despite notice sent through his wife, who was also employed by
petitioner company, through a memorandum dated 22 July 1992[3] and
personal notification by another employee, Nilo Wales. [4] Petitioners insist
that private respondents are not entitled to holiday pay on the basis of
bare allegations and without specifying the unpaid holidays.
Clearly, there are only two (2) issues that confront this
Court: (1) whether respondent NLRC committed grave abuse of discretion
in ordering petitioners to reinstate private respondents Romulo Albasin,
George Macaspac, Gilbert Rivera, Mary Ann Macaspac, Flora Balbino and
Melchor Cachucha; and, (2) whether these private respondents are entitled
to holiday pay.
The factual findings of administrative bodies, being considered
experts in their field, are binding on this Court. But this is a general rule
which holds true only when established exceptions do not obtain.One of
these exceptions is where the findings of the Labor Arbiter and the NLRC
are contrary to each other, as in the present case. Thus, there is a
necessity to review the records to determine which conclusions are more
conformable to the evidentiary facts.[5]
With regard to George Macaspac and Romulo Albasin, security guards
M. Abelgas and E. Antonio submitted an incident report to the Manager of
petitioner company regarding the destruction of several bundles of towels
by Macaspac and Albasin with the use of razor blades. [6] In fact, on 20 July
1992 petitioner Bico as Supervisor of petitioner company filed a complaint
for malicious mischief against them the property destroyed being
worth P3,800.00.[7] In this connection, another employee of petitioners,
323
Jose Arnel Mejia, executed a sworn statement on the same day before the
State Prosecutor regarding the incident -
xxxx
NLRC did not find lawful cause for the dismissal of Macaspac and
Albasin since x x x x Records show that respondents failed to give the aforenamed
complainants an opportunity to be heard. There was no investigation
conducted, calling the attention of the aforenamed complainants (to) the
charge imputed against them and requiring them to explain and/or answer
the same. Respondents' lone witness in the person of Jose Arnel Mejia was
not presented for confrontation by the said complainants. Thus, with the
vehement denial of the complainants, together with their own
witnesses (pp. 157-163, Records), We find the charge imputed against
them of questionable veracity x x x x[12]
The ruling is correct. We find that petitioners were unable to
substantiate the charge of serious misconduct against Macaspac and
Albasin. The incident report of the two (2) security guards was on its face
categorical on the culpability of subject respondents, yet it is perplexing
that the report was not utilized as supporting evidence in the criminal
proceedings. The affidavit of petitioner Bico sworn to before the State
Prosecutor only mentioned that xxxx
08. T: Alam mo ba ang dahilan at kung bakit ginawa nila ang bagay na
iyon?
324
325
[24]
Balbino might have taken the time card in her name but the Court
considers this act as a mere emotional outburst and an offshoot of her
suspension. Anyway, no material damage was demonstrated to have been
suffered by petitioners on account thereof. A time card shows the actual
number of hours and days in a certain period performed by an employee
such that the loss thereof will surely pose a problem. But not so in the case
of Balbino since only her work performed on 31 July and 3 August 1992
was unpaid. These circumstances on non-payment were uncontroverted by
petitioners, rightfully entitling Balbino to an award therefor which the NLRC
determined to be P236.00. Also worth mentioning is the fact that Balbino
was denied procedural due process when she was summarily dismissed. [31]
326
The award of compensation for ten (10) regular holidays for 1990,
1991 and 1992 by the NLRC is proper. The dismissed workers distinctly set
forth in their Position Paper that they were not remunerated for ten (10)
regular holidays for the years 1990, 1991 and 1992. [37] This claim stands
undisputed.
WHEREFORE, the Resolution of public respondent National Labor
Relations Commission of 22 November 1994 directing petitioners GOLDEN
THREAD KNITTING INDUSTRIES, INC., GEORGE NG and WILFREDO BICO to
immediately reinstate private respondents George Macaspac, Mary Ann
Macaspac, Romulo Albasin, Melchor Cachucha, Gilbert Rivera and Flora
Balbino to their former positions without loss of seniority rights and other
privileges and with full back wages, inclusive of allowances, and to their
other benefits or their monetary equivalent computed from the time of
their dismissal up to actual reinstatement, is AFFIRMED but
with modification as regards private respondent Balbino whose date of
termination should be 12 August 1992, taking into account her one (1)
week
suspension. All
the
rest
of
the
dispositive portion, particularly the order to petitioners to pay private
respondents for ten (10) regular holidays for 1990, 1991 and 1992; to pay
private respondent Balbino her wages for two (2) days amounting
to P236.00; and, to pay private respondents attorney's fees
equivalent to ten per cent (10%) of the total monetary awards, is
likewise AFFIRMED. Costs against petitioners.
SO ORDERED.
SYNOPSIS
The NLRC reversed the decision of the Labor Arbiter upholding the
dismissals of private respondents by declaring that they were illegally
dismissed and thus, directed petitioners to immediately reinstate said
private respondents with full back wages and other benefits.
The Court agreed with the ruling of the NLRC. The charge of serious
misconduct against Romulo Albasin and George Macaspac was not
substantiated. Further, they were denied procedural due process because
they were not afforded the benefit of hearing and investigation before
termination. Neither did they receive notice to that effect. They were
summarily eased out of employment when they were refused entry into
327
the company premises after allegedly slashing with razor blades several
bundles of towels in the warehouse.
As regards Gilbert Rivera and Mary Ann Macaspac who were
terminated on the ground of redundancy, there existed serious doubt on
the validity and propriety of their termination. It was not shown why their
positions were indeed unnecessary and no criterion whatsoever was
adopted in their dismissal. Further, the dismissal was not reported to the
DOLE as required by law.
On the part of Flora Balbino who was terminated for serious
misconduct for hurling invectives and threats to his employer, and taking
her time card off the rack, the Court ruled that the same was provoked by
the employer who imposed baseless suspension on her. Hence, dismissal
was too harsh a penalty. One week suspension would have sufficed. Then
again, she was denied procedural due process when she was summarily
dismissed.
On the termination of Melchor Cachucha for abandonment of work,
the Court noted that Cachucha lost no time in filing a complaint for illegal
dismissal against petitioners. This was incompatible with the charge of
abandonment and confirmed his allegation that he was refused entry into
the company premises.
328
Russell, and Benjamin filed a Complaint for illegal dismissal before the
Labor Arbiter. They prayed for payment of allowance, separation pay, and
attorneys fees.10
In their defense, G.J.T. Rebuilders and the Trillana spouses argued that
G.J.T. Rebuilders suffered serious business losses and financial reverses,
forcing it to close its machine shop. Therefore, Ricardo, Russell, and
Benjamin were not entitled to separation pay.11
Labor Arbiter Facundo L. Leda (Labor Arbiter Leda) decided the Complaint,
finding no convincing proof of G.J.T. Rebuilders alleged serious business
losses. Labor Arbiter Leda, in the Decision12 dated December 28, 1999,
found that Ricardo, Russell, and Benjamin were entitled to separation pay
under Article 283 of the Labor Code.13 In addition, they were awarded
attorneys fees, having been constrained to litigate their claims. 14
Even assuming that G.J.T. Rebuilders closure was due to serious business
losses, Labor Arbiter Leda held that the employees affected were still
entitled to separation pay based on social justice and equity. 15
G.J.T. Rebuilders and the Trillana spouses appealed Labor Arbiter Ledas
Decision before the National Labor Relations Commission.16
In contrast with the Labor Arbiters finding, the National Labor Relations
Commission found G.J.T. Rebuilders to have suffered serious business
losses. Because of the fire that destroyed the building where G.J.T.
Rebuilders was renting space, the demand for its services allegedly
declined as no same customer would dare to entrust machine works to be
done for them in a machine shop lying in a ruined and condemned
building.17 The National Labor Relations Commission then concluded that
the fire proximately caused18 G.J.T. Rebuilders serious business losses,
with its financial statement for the fiscal year 1997 showing a net loss of
P316,210.00.19
In the Decision20 dated January 25, 2001, the National Labor Relations
Commission vacated and set aside Labor Arbiter Ledas Decision and
dismissed the Complaint for lack of merit. Since the Commission found
that G.J.T. Rebuilders ceased operations due to serious business losses, it
held that G.J.T. Rebuilders and the Trillana spouses need not pay Ricardo,
Russell, and Benjamin separation pay.
Ricardo, Russell, and Benjamin filed a Motion for Reconsideration, which
the National Labor Relations Commission denied in the Resolution 21 dated
March 5, 2001.
Because of the alleged grave abuse of discretion of the National Labor
Relations Commission, a Petition for Certiorari was filed before the Court of
Appeals.22
329
I
G.J.T. Rebuilders must pay respondents
their separation pay for failure to prove
its alleged serious business losses
Article 283 of the Labor Code allows an employer to dismiss an employee
due to the cessation of operation or closure of its establishment or
undertaking, thus:
Art. 283. Closure of establishment and reduction of personnel.
The employer may also terminate the employment of any employee due to
the installation of labor saving devices, redundancy, retrenchment to
prevent losses or the closing or cessation of operation of the establishment
or undertaking unless the closing is for the purpose of circumventing the
provisions of this Title, by serving a written notice on the workers and the
Department of Labor and Employment at least one (1) month before the
intended date thereof. In case of termination due to installation of labor
saving devices or redundancy, the worker affected thereby shall be entitled
to a separation pay equivalent to at least his one (1) month pay or to at
least one (1) month pay for every year of service, whichever is higher. In
case of retrenchment to prevent losses and in cases of closures or
cessation of operations of establishment or undertaking not due to serious
business losses or financial reverses, the separation pay shall be
equivalent to one (1) month pay or to at least one-half (1/2) month pay for
every year of service, whichever is higher. A fraction of at least six (6)
months shall be considered one (1) whole year.
The decision to close ones business is a management prerogative that
courts cannot interfere with.35 Employers can lawfully close shop at
anytime,36 even for reasons of their own. Just as no law forces anyone to
go into business, no law can compel anybody to continue in it. 37 In Mac
Adams Metal Engineering Workers Union-Independent v. Mac Adams Metal
Engineering,38 this court said:
It would indeed be stretching the intent and spirit of the law if [courts]
were to unjustly interfere with the managements prerogative to close or
330
with the notice requirement under Article 283 of the Labor Code.
Employers must serve a written notice on the affected employees and on
the Department of Labor and Employment at least one month before the
intended date of closure. Failure to comply with this requirement renders
the employer liable for nominal damages.55
We uphold G.J.T. Rebuilders decision to close its establishment as a valid
exercise of its management prerogative. G.J.T. Rebuilders closed its
machine shop, believing that its former customers . . . seriously doubted
[its] capacity . . . to perform the same quality [of service] 56 after the fire
had partially damaged the building where it was renting space.
Nevertheless, we find that G.J.T. Rebuilders failed to sufficiently prove its
alleged serious business losses.
The financial statement G.J.T. Rebuilders submitted in evidence covers the
fiscal years 1996 and 1997. Based on the financial statement, G.J.T.
Rebuilders earned a net income of P61,157.00 in 1996 and incurred a net
loss of P316,210.00 in 1997.57
We find the two-year period covered by the financial statement insufficient
for G.J.T. Rebuilders to have objectively perceived that the business would
not recover from the loss. Unlike in North Davao Mining Corporation,
Manatad, and LVN Pictures Employees and Workers Association (NLU), no
continuing pattern of loss within a sufficient period of time is present in this
case. In fact, in one of the two fiscal years covered by the financial
statement presented in evidence, G.J.T. Rebuilders earned a net income.
We, therefore, agree with the Labor Arbiter and the Court of Appeals that
G.J.T. Rebuilders closed its machine shop to prevent losses, not because of
serious business losses.58
Considering that G.J.T. Rebuilders failed to prove its alleged serious
business losses, it must pay respondents their separation pay equivalent to
one-month pay or at least one-half-month pay for every year of service,
whichever is higher. In computing the period of service, a fraction of at
least six months is considered a year.59
Ricardo began working as a machinist on February 9, 1978. 60 Since he last
worked for G.J.T. Rebuilders on December 15, 1997, he worked a total of 19
years, 10 months, and six days. This period is rounded off to 20 years,
with the last 10 months and six days being considered a year. 61
Ricardo had a daily salary of P230.00 and worked 13 days a month. 62 His
one-month pay, therefore, is equal to P2,990.00. On the other hand, his
one-half-month pay for every year of service is equal to P29,250.00. The
latter amount being higher, Ricardo must receive P29,250.00 as separation
pay.
With respect to Russell, he began his employment on September 1,
1992.63 Since he last worked for G.J.T. Rebuilders on December 15, 1997,
331
he worked a total of five years, three months, and 14 days. This period is
rounded off to five years, not six years, since the last three months and 14
days are less than the six months required to be considered a year. 64
Russell had a daily salary of P225.00 and worked 13 days a month. 65 His
one-month pay, therefore, is equal to P2,925.00. On the other hand, his
one-half-month pay for every year of service is equal to P7,312.50. The
latter amount being higher, Russell must receive P7,312.50 as separation
pay.
As for Benjamin, he began working as a machinist on February 1, 1994. 66
Since he last worked for G.J.T. Rebuilders on December 15, 1997, he
worked a total of three years, 10 months, and 14 days. This period is
rounded off to four years, with the last 10 months and 14 days being
considered a year.67
Benjamin had a daily salary of P225.00 and worked 13 days a month. 68 His
one-month pay, therefore, is equal to P2,925.00. On the other hand, his
one-half-month pay for every year of service is equal to P5,850.00. The
latter amount being higher, Benjamin must receive P5,850.00 as
separation pay.
II
G.J.T. Rebuilders must pay respondents
nominal damages for failure to comply
with the procedural requirements for
closing its business
In addition to separation pay, G.J.T. Rebuilders must pay each of the
respondents nominal damages for failure to comply with the notice
requirement under Article 283 of the Labor Code.
Notice of the eventual closure of establishment is a personal right of the
employee to be personally informed of his [or her] proposed dismissal as
well as the reasons therefor.69 The reason for this requirement is to give
the employee some time to prepare for the eventual loss of his [or her]
job.70
The requirement is not a mere technicality or formality which the
employer may dispense with.71 Should employers fail to properly notify
their employees, they shall be liable for nominal damages even if they
validly closed their businesses.72
Generally, employers that validly closed their businesses but failed to
comply with the notice requirement are liable in the amount of
P50,000.00.73 This amount of nominal damages, however, may be reduced
depending on the sound discretion of the court.74 In Sangwoo
Philippines, Inc. v. Sangwoo Philippines, Inc. Employees Union-OLALIA,75 we
said that:
332
P29,250.00
P7,312.50
P5,850.00.
333
SHIMIZU PHILS.
CONTRACTORS, INC.,
Petitioner,
- versus -
Present:
Respondent then filed an illegal dismissal complaint against petitioner assailing his
VIRGILIO P. CALLANTA,
Promulgated:
Respondent.
September 29, 2010
x------------------------------------------------------------------x
DECISION
DEL CASTILLO, J.:
(petitioner) assails the Decision[2] dated June 10, 2004 and Resolution[3] dated
October 5, 2004 of the Court of Appeals (CA) in CA-G.R. SP. No. 66888, which
reversed the Decision[4] dated December 14, 2000 of the National Labor Relations
respondent his separation pay which the latter refused to accept and instead filed
(respondent) and pay him his backwages for not having been validly dismissed.
Respondent claimed that petitioner failed to comply with the requirements called
Antecedent Facts
mandating the service of notice of retrenchment. He pointed out that the notice
sent to him never mentioned retrenchment but only project completion as the
cause of termination. Also, the notice sent to the Department of Labor and
Employment
(DOLE)
did
not
conform
to
the
30-day
prior
notice
services will be terminated effective July 9, 1997 due to the lack of any vacancy in
termination report[6] submitted to DOLE, he was the only one dismissed out of 333
other projects and the need to re-align the companys personnel requirements
334
in his stead to new projects thus also ignoring seniority in hiring and firing
employees.
In reply, petitioner reiterated its progressive implementation of the retrenchment
program and finds this as basis why respondents termination coincided with
project completion. Petitioner argued that when it submitted the retrenchment
notice/termination report to DOLE, there was already substantial compliance with
the requirement. It explained that such termination report reflects only the
number of employees retrenched for the particular month of July of 1997 and
cannot be deemed as evidence of the total number of employees affected by the
retrenchment program. Petitioner also accused respondent of giving false
In
terminating
the
services
of
complainant,
respondent Shimizu had complied with the requirements of law
on retrenchment. It had prepared a check for the amount
of P 29,320.30 as payment for his separation pay and other
entitlements. However, as afore-stated, complainant refused to
receive the amount, for reasons known only to him. Also,
respondent company had duly notified the Department of Labor
and Employment (DOLE) about the retrenchment of the
complainant.
WHEREFORE, in view of the foregoing premises, judgment is
hereby rendered dismissing the instant complaint for lack of
merit.
SO ORDERED.[12]
narration of facts about his employment position and further disclosed that
respondent has been saddled with complaints subject of administrative
investigations for violations of several company rules, i.e., cited for discrepancies
in his time sheet,[7] unauthorized use of company vehicle, [8] stealing of company
Upon appeal, the NLRC upheld the ruling that there was valid ground for
respondents termination but modified the Labor Arbiters Decision by holding that
appoint more competent and more senior employees in his stead cannot be
petitioner violated respondents right to procedural due process. The NLRC found
questioned.
that petitioner failed to comply with the 30-day prior notice to the DOLE and that
there is no proof that petitioner used fair and reasonable criteria in the selection of
employees to be retrenched. The dispositive portion of the NLRC Decision reads:
On April 14, 2000, the Labor Arbiter rendered a Decision[11] holding that
respondent was validly retrenched. He found that sufficient evidence was
presented to establish company losses; that petitioner offered respondent his
separation
pay;
and
that
petitioner
duly
notified
DOLE
about
the
SO ORDERED.[13]
behavioral conduct.
Both parties sought reconsideration of the NLRCs Decision. Respondent, in his
Pertinent portions of the Labor Arbiters Decision read:
Motion for Reconsideration,[14] attributed grave error upon the NLRC in ruling that
335
the absence of fair and reasonable criteria in effecting the retrenchment affected
only the requirements of due process, arguing that such failure should have
CA, petitioners failure to produce evidence raises the presumption that such
invalidated the entire retrenchment program. Petitioner, for its part, filed a Motion
[15]
to respondent.
The NLRC, in its Resolution[16] dated June 29, 2001, denied respondents motion
and found merit in petitioners motion by modifying the amount of separation pay
to an amount equivalent to one month or one-half month pay for every year of
service, whichever is higher, in consonance with Article 283 of the Labor Code.
Thus:
WHEREFORE, premises considered, the complainants Motion for
Reconsideration is hereby DENIED for lack of merit. The
respondents partial motion for reconsideration is hereby
GRANTED.Consequently, our Decision promulgated on
December 14, 2000 is hereby MODIFIED in that the separation
pay granted to complainant should be one (1) month pay or
one-half (1/2) month pay for every year of service, whichever is
higher, a fraction of at least six months to be considered one (1)
whole year.
Other dispositions in our said Decision stand Affirmed.
SO ORDERED.
[17]
The CA denied petitioners Motion for Reconsideration [19] and reiterated that
petitioner offered no proof of any standard or program intended to implement the
retrenchment program.
Issues
Ruling of the Court of Appeals
Thus, the instant petition raising the following issues:
Undaunted, respondent filed a petition for certiorari with the CA. On June 10,
2004, the CA reversed and set aside the NLRCs ruling. The CA opined that
petitioner failed to prove that there were employees other than respondent who
were similarly dismissed due to retrenchment and that respondents alleged
replacements
held
much
higher
ranks
and
were
more
deserving
employees. Moreover, there were no proofs to sustain that petitioner used fair and
A.
WHETHER X X X THE HONORABLE COURT OF APPEALS
EXCEEDED ITS JURISDICTION WHEN IT REVERSED THE FACTUAL
FINDINGS OF THE LABOR ARBITER AND THE NLRC BY REEVALUATING THE EVIDENCE ON RECORD.
B.
336
[21]
findings or the legal conclusions of the NLRC in order to determine whether these
findings are supported by the evidence presented and the conclusions derived
Petitioner contends that the CAs corrective power in petitions for certiorari is
confined only to jurisdictional issues and a determination of whether there is grave
abuse of discretion amounting to lack or excess of jurisdiction. It does not
encompass the reevaluation and reassessment of factual findings and conclusions
of the Labor Arbiter which should be accorded great weight and respect when
affirmed by the NLRC. According to petitioner, the CA gravely erred in finding that
no valid retrenchment exists contrary to the prior findings of the Labor Arbiter and
NLRC.
Petitioner also insists that all the requisites for a valid retrenchment have been
established by substantial evidence and that it observed fair and reasonable
therefrom are accurately ascertained.[22] It has been held that [i]t is within the
jurisdiction of the CA x x x to review the findings of the NLRC.[23]
From the foregoing, the CA, in the present case, cannot be faulted in re-evaluating
the NLRCs findings as it can undoubtedly affirm, modify or reverse the same if the
evidence warrants.Having settled thus, we shall now proceed to review whether
the CA correctly appreciated the NLRCs finding and if the CAs resultant decision
was in accord with law and evidentiary facts.
There
was
substantial
compliance for a valid
retrenchment; petitioner used
fair and reasonable criteria in
effecting retrenchment.
(2)
(3)
Our Ruling
337
(4)
(5)
In the present case, both the Labor Arbiter and the NLRC found sufficient
foregoing facts. Respondents argument that he was singled out for termination as
prove that petitioner was sustaining business losses, that separation pay was
allegedly shown in petitioners monthly termination report for the month of July
1997 filed with the DOLE does not persuade this Court. Standing alone, this
respondent and DOLE. However, the NLRC modified the Decision of the Labor
Arbiter by granting respondent indemnity since the notice to DOLE was served
respondent was the only one retrenched. It merely serves as notice to DOLE of
short of the 30-day notice requirement and that there is no proof of the use of fair
the names of employees terminated/ retrenched only for the month of July. In
retained. The CA, then, reversed the Decision of the NLRC by ruling that the
Respondent then claimed that petitioner did not observe seniority in retrenching
him. He further alleged that he is more qualified and efficient than those retained
by petitioner. Notably, however, the records do not bear any proof that these
its financial statements and that it substantially complied with the requirements of
serving written notices of retrenchment. It was also shown that it offered to pay
respondents separation pay. The CA, however, ruled that petitioner failed to show
that it implemented its retrenchment program in a just and proper manner in the
By advancing that other employees were less efficient, qualified and senior than
him, respondent has the burden of proving these allegations which he failed to
progressive manner in order not to jeopardize the completion of its projects. Thus,
discharge.
338
compliance with this rule clearly violates the employees right to statutory due
On the contrary, we find that petitioner implemented its retrenchment program in
process.
good faith because it undertook several measures in cutting down its costs, to wit,
withdrawing certain privileges of petitioners executives and expatriates; limiting
want of sufficient due notice. But to be consistent with our ruling in Jaka Food
down expenses; selling of company vehicles; and infusing fresh capital into the
company. Respondent did not attempt to refute that petitioner adopted these
WHERFORE, the petition is GRANTED. The challenged June 10, 2004 Decision
and October 5, 2004 Resolution of the Court of Appeals in CA- G.R. SP. No. 66888
In fine, we hold that petitioner was able to prove that it incurred substantial
are REVERSED and SET ASIDE. The Decision and Resolution of the National
business losses, that it offered to pay respondent his separation pay, that the
Labor Relations Commission dated December 14, 2000 and June 29, 2001,
retrenchment scheme was arrived at in good faith, and lastly, that the criteria or
separation pay equivalent to one (1) month pay or one-half (1/2) month pay for
every
year
of
service,
whichever
is
higher,
However, although there was authorized cause to dismiss respondent from the
service, we find that petitioner did not comply with the 30-day notice
requirement. Petitioner maintains that it substantially complied with the
requirement of the law in that it, in fact, submitted two notices or reports with the
DOLE. However, petitioner admitted that the reports were submitted 21 days, in
the case of the first notice, and 16 days, in the case of the second notice, before
the intended date of respondents dismissal.
The purpose of the one month prior notice rule is to give DOLE an
opportunity to ascertain the veracity of the cause of termination. [26] Non-
SO ORDERED.
339
INTERNATIONAL
MANAGEMENT
SERVICES/MARILYN C. PASCUAL,
Petitioner,
- versus -
ROEL P. LOGARTA,
Respondent.
x-----------------------------------------------------------------------------------------x
PERALTA, J.:
However, in a letter[4] dated April 29, 1998, Saudi Aramco notified Petrocon
This
is
petition
for
review
on certiorari assailing
the
that due to changes in the general engineering services work forecast for
1998, the man-hours that were formerly allotted to Petrocon is going to be
reduced by 40%.
340
Thus,
on June
1,
1998,
Petrocon
gave
respondent
written
After the parties filed their respective position papers, the Labor
notice[5] informing the latter that due to the lack of project works related to
his expertise, he is given a 30-day notice of termination, and that his last
day of work with Petrocon will be on July 1, 1998. Petrocon also informed
respondent that all due benefits in accordance with the terms and
conditions of his employment contract will be paid to respondent, including
his ticket back to the Philippines.
Petrocon to issue them a letter of Intent stating that the latter will issue
So Ordered.[10]
Before his departure from Saudi Arabia, respondent received his final
Branch
VII,
National
Labor
Relations
Commission
his employment contract with Petrocon on the ground that he was illegally
dismissed.
Not satisfied, petitioner sought recourse before the CA, [15] arguing
that the NLRC gravely abused its discretion:
341
given a 30-day notice of his termination, there was no showing that the
(a)
Department of Labor and Employment (DOLE) was also sent a copy of the
said notice as required by law. Moreover, the CA found that a perusal of the
check payroll details would readily show that respondent was not paid his
separation pay.
I.
THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR
IN RULING THAT THE 30-DAY NOTICE TO DOLE PRIOR TO
RETRENCHMENT IS NOT APPLICABLE IN THIS CASE.
SO ORDERED.[17]
II.
THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR
IN RULING THAT RESPONDENT EMPLOYEE DID NOT
CONSENT TO HIS SEPARATION FROM THE PRINCIPAL
COMPANY.
III.
THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR
IN RULING THAT JARIOL VS. IMS IS NOT APPLICABLE TO THE
INSTANT CASE.
affected
by
the
reduced
work
allocation
from
IV.
THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR
IN RULING THAT RESPONDENT DID NOT RECEIVE THE
SEPARATION PAY REQUIRED BY LAW.[19]
Saudi
Petitioner argues that the 30-day notice of termination, as required
Aramco. However, although there was a valid ground for retrenchment, the
in Serrano v. NLRC,[20] is not applicable in the case at bar, considering that
same was implemented without complying with the requisites of a valid
respondent was in fact given the 30-day notice. More importantly, Republic
retrenchment. Also, the CA concluded that although the respondent was
342
Act (R.A.) No. 8042, or the Migrant Workers and Overseas Filipino Act of
(1) month pay or at least one-half (1/2) month pay for every year of
1995 nor its Implementing Rules do not require the sending of notice to the
Code.
employers.
Petitioner also posits that the CA should have applied the case of Jariol v.
IMS[21] even if the said case was only decided by the NLRC, a quasi-judicial
agency. The
said
case
involved
similar
facts,
wherein
the
NLRC
categorically ruled that employers of OFWs are not required to furnish the
by
employee.
the
employer
during
periods
of
business
recession,
industrial
petitioner
insists
that
respondent
received
his
separation
pay. Moreover, petitioner contends that Section 10 of R.A. No. 8042 does
not apply in the present case, since the termination of respondent was due
provided it is done in good faith and the employer faithfully complies with
separation pay in accordance with Article 283 of the Labor Code, i.e., one
jurisprudence.[24]
343
In the case at bar, despite the fact that respondent was employed by
Petrocon as an OFW in Saudi Arabia, still both he and his employer are
subject to the provisions of the Labor Code when applicable. The basic
policy in this jurisdiction is that all Filipino workers, whether employed
Thus, retrenchment is a valid exercise of management prerogative
locally or overseas, enjoy the protective mantle of Philippine labor and
social legislations.[25] In the case of Royal Crown Internationale v. NLRC,
[26]
344
personnel, thus:
Moreover, from the standard form of employment
contract relied upon by the Labor Arbiter, it is clear that
unilateral cancellation (sic) may be effected for legal, just
and valid cause or causes. Clearly, contrary to the Labor
Arbiters
perception,
the
enumerated
causes
for
employment termination by the employer in the standard
form of employment contract is not exclusive in the same
manner that the listed grounds for termination by the
employer is not exclusive. As pointed out above, under
Sec. 10 of RA 8042, it is clear that termination of
employment may be for just, valid or authorized cause as
defined by law or contract. Retrenchment being indubitably
a legal and authorized cause may be availed of by the
respondent.
From the records, it is clearly shown that there was
a drastic reduction in Petrocons 1998 work allocation from
250,000 man-hours to only 80,000 man-hours. Under these
circumstances over which respondents principal, Petrocon
had no control, it was clearly a valid exercise of
management prerogative to reduce personnel particularly
those without projects to work on. To force Petrocon to
continue maintaining all its workers even those without
projects is tantamount to oppression. The determination to
cease operation is a prerogative of management which the
state does not usually interfere with as no business or
undertaking must be required to continue at a loss simply
because it has to maintain its employees in
employment. Such an act would be tantamount to a taking
of property without due process of law. (Industrial Timber
Corp. vs. NLRC, 273 SCRA 200)[29]
345
[33]
petitioner to establish that Petrocon ever sent a notice to the DOLE 30 days
month prior to his departure, and hence, was justly due to him as his
before the respondent was terminated. Thus, this requirement of the law
Benefit and Other Earning/Allowances: for July 1998 [34] form part of his
clearly reveals that what he received was his compensation for the
pay.
his dismissal and eventual return to the Philippines is but logical and
However, this Court disagrees with the conclusion of the Labor Arbiter, the
NLRC and the CA, that respondent should be paid his separation pay in
in Saudi Arabia.
in the case at bar. Suffice it to state that although Article 8 of the Civil
Code[31] recognizes judicial decisions, applying or interpreting statutes as
In the case at bar, notwithstanding the fact that respondents
part of the legal system of the country, such level of recognition is not
termination from his employment was procedurally infirm, having not
afforded to administrative decisions.[32]
complied with the notice requirement, nevertheless the same remains to
be for a just, valid and authorized cause, i.e., retrenchment as a valid
Anent the proper amount of separation pay to be paid to
exercise of
respondent, petitioner maintains that respondent was paid the appropriate
346
SYLLABUS
management prerogative. To stress, despite the employers failure to
comply with the one-month notice to the DOLE prior to respondents
termination, it is only a procedural infirmity which does not render the
retrenchment illegal. In Agabon v. NLRC,[35] this Court ruled that when the
dismissal is for a just cause, the absence of proper notice should not nullify
the dismissal or render it illegal or ineffectual. Instead, the employer
should indemnify the employee for violation of his statutory rights. [36]
Court
of
Appeals
is ORDERED to pay Roel P. Logarta one (1) month salary as separation pay
and P50,000.00 as nominal damages.
SO ORDERED.
347
DECISION
PANGANIBAN, J.:
Is a company which is forced by huge business losses to close its
business, legally required to pay separation benefits to its employees at
the time of its closure in an amount equivalent to the separation pay paid
to those who were separated when the company was still a going
concern? This is the main question brought before this Court in this petition
for certiorari under Rule 65 of the Revised Rules of Court, which seeks to
reverse and set aside the Resolutions dated July 29, 1993 [1] and September
27, 1993[2] of the National Labor Relations Commision [3] (NLRC) in NLRC-CA
No. M-001395-93.
The Resolution dated July 29, 1993 affirmed in tow the decision of the
Labor Arbiter in RAB-1 1-08-00672-92 and RAB- 11-08-00713-92 ordering
petitioners to pay the complainants therein certain monetary claims.
The Resolution dated September 27, 1993 denied the motion for
reconsideration of the said July 29, 1993 Resolution.
The Facts
Petitioner North Davao Mining Corporation (North Davao) was
incorporated in 1974 as a 100% privately-owned company. Later, the
Philippine National Bank (PNB) became part owner thereof as a result of a
conversion into equity of a portion of loans obtained by North Davao from
said bank. On June 30, 1986, PNB transferred all its loans to and equity in
North Davao in favor of the national government which, by virtue of
Proclamation No. 50 dated December 8, 1986, later turned them over to
petitioner Asset Privatization Trust (APT). As of December 31, 1990 the
national government held 81.8% of the common stock and 100% of the
preferred stock of said company. [4]
Respondent Wilfredo Guillema is one among several employees of
North Davao who were separated by reason of the companys closure on
May 31, 1992, and who were the complainants in the cases before the
respondent labor arbiter.
On May 31, 1992, petitioner North Davao completely ceased
operations due to serious business reverses. From 1988 until its closure in
1992, North Davao suffered net losses averaging three billion pesos
(P3,000,000,000.00) per year, for each of the five years prior to its
closure. All told, as of December 31, 1991, or five months prior to its
closure, its total liabilities had exceeded its assets by 20.392 billion pesos,
as shown by its financial statements audited by the Commission on
Audit. When it ceased operations, its remaining employees were separated
and given the equivalent of 12.5 days pay for every year of service,
computed on their basic monthly pay, in addition to the commutation to
cash of their unused vacation and sick leaves. However, it appears that,
during the life of the petitioner corporation, from the beginning of its
operations in 1981 until its closure in 1992, it had been giving separation
pay equivalent to thirty (30) days pay for every year of service. Moreover,
inasmuch as the region where North Davao operated was plagued by
insurgency and other peace and order problems, the employees had to
collect their salaries at a bank in Tagum, Davao del Norte, some 58
kilometers from their workplace and about 2 hours travel time by public
transportation; this arrangement lasted from 1981 up to 1990.
Subsequently, a complaint was filed with respondent labor arbiter by
respondent Wilfredo Guillema and 271 other seperated employees for: (1)
additional separation pay of 17.5 days for every year of service; (2) back
wages equivalent to two days a month; (3) transportation allowance; (4)
hazard pay; (5) housing allowance; (6) food allowance; (7) postemployment medical clearance; and (8) future medical allowance, all of
which amounted to P58,022,878.31 as computed by private respondent. [5]
On May 6, 1993, respondent Labor Arbiter rendered a decision
ordering petitioner North Davao to pay the complainants the following:
(a) Additional separation pay of 17.5 days for every year of service;
(b) Backwages equivalent to two (2) days a month times the number of
years of service but not to exceed three (3) years;
(c) Transportation allowance at P80 a month times the number of years of
service but not to exceed three (3) years.
The benefits awarded by respondent Labor Arbiter amounted to
P10,240,517.75. Attorneys fees equivalent to ten percent (10%) thereof
were also granted.[6]
348
349
350
351
whenever not possible, through the bank in Tagum, Davao del Norte as
already been practiced subject, however to the provisions of Section 4 of
Rule VIII, Book III of the rules implementing the Labor Code as amended.
Thus, public respondent Labor Arbiter Antonio M. Villanueva correctly
held that:
From the evidence on record, we find that the hours spent by complainants
in collecting salaries at a bank in Tagum, Davao del Norte shall be
considered compensable hours worked. Considering further the distance
between Amacan, Maco to Tagum which is 2 hours by travel and the risks
in commuting all the time in collecting complainants salaries, would justify
the granting of backwages equivalent to two (2) days in a month as prayed
for.
Corollary to the above findings, and for equitable reasons, we likewise hold
respondents liable for the transportation expenses incurred by
complainants at P40.00 round trip fare during pay days.
(p. 10, Decision; p. 207, Vol. 1, Record)
On the contrary, it will be petitioners burden or duty to present
evidence of compliance of the law on labor standards, rather than for
private respondents to prove that they were not paid/provided by
petitioners of their backwages and transportation expenses.
Other than the bare denials of petitioners, the above findings stands
uncontradicted. Indeed we are not at liberty to set aside findings of facts of
the NLRC, absent any capriciousness, arbitrariness, or abuse or complete
lack of basis. In Maya Farms Employees Organizations vs. NLRC, [16] we
held:
This Court has consistently ruled that findings of fact of administrative
agencies and quasi-judicial bodies which have acquired expertise because
their jurisdiction is confined to specific matters are generally accorded not
only respect but even finality and are binding upon this Court unless there
is a showing of grave abuse of discretion, or where it is clearly shown that
they were arrived at arbitrarily or in disregard of the evidence on record.
352
August 6, 2014
353
354
requires the same only when the closure is not due to serious business
losses; conversely, the obligation is maintained when the employers
closure is not due to serious business losses. For a similar exemption to
obtain against a contract, such as a CBA, the tenor ofthe parties
agreement ought to be similar to the laws tenor. When the parties,
however, agree to deviate therefrom, and unqualifiedly covenant the
payment of separation benefits irrespective of the employersfinancial
position, thenthe obligatory force of that contract prevails and its terms
should be carried out to its full effect. Verily, it is fundamental that
obligations arising from contracts have the force of law between the
contracting parties and thus should be complied with in good faith; 24 and
parties are bound by the stipulations, clauses, terms and conditions they
have agreed to, the only limitation being that these stipulations, clauses,
terms and conditions are not contrary to law, morals, public order or public
policy.25 Hence, if the terms of a CBA are clear and there is no doubt as to
the intention ofthe contracting parties, the literal meaning of its
stipulations shall prevail.26 As enunciated in Honda Phils., Inc. v. Samahan
ng Malayang Manggagawa sa Honda:27
A collective bargaining agreement refers to the negotiated contract
between a legitimate labor organization and the employer concerning
wages, hours of work and all other terms and conditions of employment in
a bargaining unit. As in all contracts, the parties in a CBA may establish
such stipulations, clauses, terms and conditions as they may deem
convenient provided these are not contrary to law, morals, good customs,
public order or public policy. Thus, where the CBA is clear and
unambiguous, it becomes the law between the parties and compliance
therewith is mandated by the express policy of the law. 28
In this case, it is undisputed thata CBA was forged by the employer,
Benson, and its employees, through the Union, to govern their relations
effective July 1, 2005 to June 30, 2010.It is equally undisputed that Benson
agreed to and was thus obligated under the CBA to pay its employees who
had been terminated without any fault attributable to them separation
benefits at the rate of 19 days for every year of service. This is particularly
found in Section 1, Article VIII of the same contract, to wit:
Section 1. Separation Pay The Company shall pay to any
employee/laborer who is terminated from the service without any fault
attributable to him, a "Separation Pay"equivalent to not less than nineteen
(19) days pay for every year of service based upon the latest rate of pay
of the employee/laborer concerned.29
355
is contrary to law, morals, public order orpublic policy, or that the same
can be interpreted as one with a condition for instance, that the parties
actually contemplated non-payment of separation benefits in the event of
closure due to serious business losses the Court isconstrained to
reinstate the October 24, 2008 VA Decision ordering Benson to pay each of
the petitioners separation benefits in "an amount equivalent to four (4)
days for every year of service based on the latest rate of pay of the
[individual petitioner] concerned, subject to whatever legallyvalid
deductions chargeable against [said individual petitioner], whenever
applicable."33
Analogous to the foregoing is the Courts disquisition in Lepanto Ceramics,
Inc. v. Lepanto Ceramics Employees Association, 34 whereby the employer
therein was held liable for the payment of Christmas bonus benefits,
considering that the grant thereof was voluntarily and unqualifiedly agreed
upon by the parties under the CBA despite the employers full awareness
of its distressed financial position (as Benson in this case), viz.:
It is a familiar and fundamental doctrine in labor law that the CBA is the
law between the parties and they are obliged to comply with its provisions.
This principle stands strong and true in the case at bar.
A reading of the provision of the CBA reveals that the same provides for
the giving of a "Christmas gift package/bonus" without qualification. Terse
and clear, the said provision did not state that the Christmas package shall
be made to depend on the petitioners financial standing. The records are
also bereft of any showing that the petitioner made it clear during the CBA
negotiations that the bonus was dependent on any condition. Indeed, if the
petitioner and respondent Association intended that the 3,000.00 bonus
would be dependent on the company earnings, such intention should have
been expressed in the CBA.
It is noteworthy that in petitioners 1998 and 1999 financial Statements, it
took note that"the 1997 financial crisis in the Asian region adversely
affected the Philippine economy."
From the foregoing, petitioner cannot insist on business losses as a basis
for disregarding its undertaking. It is manifestly clear that petitioner was
very much aware of the imminence and possibility of business losses owing
to the 1997 financial crisis.In 1998, petitioner suffered a net loss
of P14,347,548.00. Yet it gave a P3,000.00 bonus to the members of the
Association. In 1999, when petitioners very own financial statement
reflected that "the positive developments in the economy have yet to
356
357
letter13 dated June 5, 2006 (return to work order), allegedly sent to him
within the six ( 6) month period under Article 286 of the Labor Code which
pertinently provides that "[t]he bona-fide suspension of the operation of a
business or undertaking for a period not exceeding six (6) months x x x
shall not terminate employment." As such, Irvine argued that Lopez's filing
of the complaint for illegal dismissal was premature. 14
The LA Ruling
On December 6, 2007, the Labor Arbiter (LA) rendered a Decision15 ruling
that Lopez was illegally dismissed. The LA did not give credence to Irvine's
argument that the lack of its project in Cavite resulted in the interruption of
Lopez's employment in view of Irvine's contradictory averment that Lopez
was merely employed on temporary detail and that he only doubled as a
guard. Granting that Lopez's work as a laborer or as a guard was really
affected by the suspension of the operations of Irvine in Cavite, the LA still
discredited Irvine's lay-off claims considering that the return to work order
Irvine supposedly sent to Lopez was not even attached to its pleadings.
Hence, without any proof that Lopez was asked to return to work, the LA
concluded that the dismissal of Lopez went beyond the six-month period
fixed by Article 286 of the Labor Code and was therefore deemed to be a
permanent one effectuated without a valid cause and due
process.16 Accordingly, Irvine was ordered to pay Lopez the sum
of P272,222.l 7, consisting of Pl 76,905.70 as backwages and other
statutory benefits, andP95,316.00 as separation pay. 17
At odds with the LA's ruling, Irvine elevated the matter on appeal 18 to the
NLRC.
The NLRC Ruling
On October 31, 2008, the NLRC rendered a Resolution 19 upholding the LA's
ruling.
It debunked Irvine's contention that Lopez was not illegally dismissed since
he was merely placed on temporary lay-off due to the lack of project in
Cavite for the reason that there was no indication, much less substantial
evidence, that Lopez was a project employee who was assigned to carry
out a specific project or undertaking, with the duration and scope specified
at the time of the engagement. In this relation, it observed that Lopez
worked with Irvine since 1994 and therefore earned the disputable
presumption that he was a regular employee entitled to security of
358
tenure.20 Thus, since Lopez was not relieved for any just or authorized
cause under Articles 282 and 283 of the Labor Code, the NLRC upheld the
LA's finding that he was illegally dismissed. 21
Dissatisfied, Irvine filed a motion for reconsideration 22 which was, however,
denied in a Resolution23 dated February 12, 2009; hence, it filed a petition
for certiorari24 before the CA.
The CA Ruling
The CA granted Irvine's certiorari petition in a Decision 25 dated September
14, 2012, thereby reversing the NLRC.
It held that Lopez's complaint for illegal dismissal was prematurely filed
since there was no indicia that Lopez was actually prevented by Irvine from
returning to work or was deprived of any work assignments or duties. 26 On
the contrary, the CA found that Lopez was asked to return to work within
the six-month period under Article 286 of the Labor Code. Accordingly, it
concluded that Lopez was merely temporarily laid off, and, thus, he could
not have been dismissed.27
Aggrieved, Lopez sought reconsideration28 but the same was denied in a
Resolution29 dated April 12, 2013, hence, this petition.
The Issue Before the Court
The core issue for the Court's resolution is whether or not the CA erred in
finding that the NLRC gravely abused its discretion in affirming the LA's
ruling that Lopez was illegally dismissed.
The Court's Ruling
The petition is meritorious.
Ruling on the propriety of Irvine's course of action in this case preliminarily
calls for a determination of Lopez's employment status - that is, whether
Lopez was a project or a regular employee.
Case law states that the principal test for determining whether particular
employees are properly characterized as "project employees" as
distinguished from "regular employees," is whether or not the "project
employees" were assigned to carry out a "specific project or undertaking,"
the duration and scope of which were specified at the time the employees
were engaged for that project. The project could either be (1) a particular
job or undertaking that is within the regular or usual business of the
employer company, but which is distinct and separate, and identifiable as
such, from the other undertakings of the company; or (2) a particular job or
undertaking that is not within the regular business of the corporation. In
order to safeguard the rights of workers against the arbitrary use of the
word "project" to prevent employees from attaining the status of regular
employees, employers claiming that their workers are project employees
should not only prove that the duration and scope of the employment was
specified at the time they were engaged, but also that there was indeed a
project.30
In this case, the NLRC found that no substantial evidence had been
presented by Irvine to show that Lopez had been assigned to carry out a
"specific project or undertaking," with its duration and scope specified at
the time of engagement. In view of the weight accorded by the courts to
factual findings of labor tribunals such as the NLRC, the Court, absent any
cogent reason to hold otherwise, concurs with its ruling that Lopez was not
a project but a regular employee.31 This conclusion is bolstered by the
undisputed fact that Lopez had been employed by Irvine since November
1994,32 or more than 10 years from the time he was laid off on December
27, 2005.33 Article 280 of the Labor Code provides that any employee who
has rendered at least one year of service, whether such service is
continuous or broken, shall be considered a regular employee:
Art. 280. Regular and casual employment. The provisions of written
agreement to the contrary notwithstanding and regardless of the oral
agreement of the parties, an employment shall be deemed to be regular
where the employee has been engaged to perform activities which are
usually necessary or desirable in the usual business or trade of the
employer, except where the employment has been fixed for a specific
project or undertaking the completion or termination of which has been
determined at the time of the engagement of the employee or where the
work or service to be performed is seasonal in nature and the employment
is for the duration of the season.
An employment shall be deemed to be casual if it is not covered by the
preceding paragraph: Provided, That any employee who has rendered at
least one year of service, whether such service is continuous or broken,
shall be considered a regular employee x x x. (Emphasis supplied)
359
Pursuant to Article 286 of the Labor Code, the suspension of the operation
of business or undertaking in a temporary lay-off situation must not exceed
six (6) months:37
Among the authorized causes for termination under Article 283 of the
Labor Code is retrenchment, or what is sometimes referred to as a "lay-off':
Art. 283. Closure of Establishment and Reduction of Personnel. The
employer may also terminate the employment of any employee due to the
installation of labor-saving devices, redundancy, retrenchment to prevent
losses or the closing or cessation of operation of the establishment or
undertaking unless the closing is for the purpose of circumventing the
provisions of this Title, by serving a written notice on the workers and the
Ministry of Labor and Employment at least one (1) month before the
intended date thereof. In case of termination due to the installation of
labor-saving devices or redundancy, the worker affected thereby shall be
entitled to a separation pay equivalent to at least his one (1) month pay or
to at least one (1) month pay for every year of service, whichever is higher.
In case of retrenchment to prevent losses and in cases of closures or
cessation of operations of establishment or undertaking not due to serious
business losses or financial reverses, the separation pay shall be
equivalent to one (1) month pay or at least one-half (1/2) month pay for
every year of service, whichever is higher. A fraction of at least six (6)
months shall be considered one (1) whole year. (Emphases supplied)
It is defined as the severance of employment, through no fault of and
without prejudice to the employee, resorted to by management during the
periods of business recession, industrial depression, or seasonal
fluctuations, or during lulls caused by lack of orders, shortage of materials,
conversion of the plant to a new production program or the introduction of
new methods or more efficient machinery, or of automation. 34 Elsewise
stated, lay-off is an act of the employer of dismissing employees because
of losses in the operation, lack of work, and considerable reduction on the
volume of its business, a right recognized and affirmed by the
360
prerogative, must be exercised in good faith - that is, one which is intended
for the advancement of employers' interest and not for the purpose of
defeating or circumventing the rights of the employees under special laws
or under valid agreements.41 Instructive on the nature of a lay-off as a
management prerogative is the following excerpt from the case of
Industrial Timber Corporation v. NLRC:42
employer,47 Irvine should have established the bona fide suspension of its
business operations or undertaking that would have resulted in the
temporary lay-off of its employees for a period not exceeding six (6)
months in accordance with Article 286 of the Labor Code. As enunciated in
Nasipit Lumber Co. v. National Organization of Workingmen
(NOWM),48 citing Somerville Stainless Steel Corporation v. NLRC: 49
[T]he burden of proving, with sufficient and convincing evidence, that such
closure or suspension is bona fide falls upon the employer. As we ruled in
Somerville Stainless Steel Corporation v. NLRC:
In the case at bar, Irvine asserts that it only temporarily laid-off Lopez from
work on December 27, 2005 for the reason that its project in Cavite had
already been finished. To support its claim, it submitted the following
pieces of evidence: (a) a copy of an Establishment Termination
Report44 evidencing Lopez's lay-off; (b) a copy of the return to work order
dated June 5, 2006;45 and (c) an affidavit46 from Irvine's personnel
manager, Aguinaldo Santos, which purports that said return to work order
was sent to Lopez by ordinary mail on June 5, 2006. The CA gave credence
to the foregoing and thus granted Irvine's certiorari petition against the
NLRC ruling which affirmed the LA's finding of illegal dismissal.
The CA is mistaken.
As the NLRC correctly ruled in this case, Lopez, who, as earlier discussed
was a regular employee of Irvine, was not merely temporarily laid off from
work but was terminated from his employment without any valid cause
therefor; thus, the proper disposition is to affirm the LA's ruling that Lopez
had been illegally dismissed.
Although the NLRC did not expound on the matter, it is readily apparent
that the supposed lay-off of Lopez was hardly justified considering the
absence of any causal relation between the cessation of Irvine's project in
Cavite with the suspension of Lopez's work. To repeat, Lopez is a regular
and not a project employee. Hence, the continuation of his engagement
with Irvine, either in Cavite, or possibly, in any of its business locations,
should not have been affected by the culmination of the Cavite project
alone. In light of the well-entrenched rule that the burden to prove the
validity and legality of the termination of employment falls on the
361
such compliance, the resulting legal conclusion is that Lopez had been
constructively dismissed; and since the same was effected without any
valid cause and due process, the NLRC properly affirmed the LA's ruling
that Lopez's dismissal was illegal.
In light of the foregoing, the CA therefore erred in granting Irvine's
certiorari petition. Indeed, a petition for certiorari should only be granted
when grave abuse of discretion exists - that. is, when a court or tribunal
acts in a capricious or whimsical exercise of judgment as is equivalent to
lack of jurisdiction.55 These qualities of capriciousness and whimsicality the
Court finds wanting in any of the NLRC's actions in this case; as such, the
reversal of the CA's Decision is hereby warranted.
WHEREFORE, the petition is GRANTED. The Decision dated September 14,
2012 and the Resolution dated April 12, 2013 of the Court of Appeals in
CA-G.R. SP No. 108385-MIN are hereby REVERSED and SET ASIDE. The
Resolutions dated October 31, 2008 and February 12, 2009 of the National
Labor Relations Commission in NLRC LAC No. 01-000428-2008 are
REINSTATED.
SO ORDERED.
362
363
right to appeal is merely a statutory remedy and that the party who seeks
to avail of the same must strictly follow the requirements therefor, the CA
decreed that the Labor Arbiters Decision had already attained finality and,
for said reason, had been placed beyond the NLRCs power of
review.19 Petitioners motion for reconsideration of the foregoing decision
was denied for lack of merit in the CAs 2 May 2008 Resolution, 20 hence,
this Rule 45 petition for review on certiorari.21 Petitioner seeks the reversal
of the CAs 29 November 2007 Decision and 2 May 2008 Resolution on the
following grounds:
THE COURT OF APPEALS GRAVELY ERRED IN RULING THAT PETITIONERS
APPEAL FILED WITH THE NATIONAL LABOR RELATIONS COMMISSION WAS
FATALLY DEFECTIVE [SINCE IT] HAD FULLY COMPLIED WITH THE
REQUIREMENTS OF THE LABOR CODE FOR PERFECTING AN APPEAL.
THE COURT OF APPEALS COMMITTED A GRAVE ABUSE OF DISCRETION IN
IMMEDIATELY SETTING ASIDE THE DECISION OF THE NLRC WITHOUT
REVIEWING THE MERITS OF THE CASE.
AT THE TIME OF THE PROMULGATION OF THE ASSAILED DECISION BY THE
COURT OFAPPEALS, THE HONORABLE SUPREME COURT HAD ALREADY
AFFIRMED THE FINDING THAT PETITIONER WAS ALREADY PERMANENTLY
CLOSED DUE TO MASSIVE FINANCIAL LOSSES.22
Time and again, it has been held that the right to appeal is not a natural
right or a part of due process; it is merely a statutory privilege, and may be
exercised only in the manner and in accordance with the provisions of
law.23 A party who seeks to avail of the right must, therefore, comply with
the requirements of the rules, failing which the right to appeal is invariably
lost.24 Insofar as appeals from decisions of the Labor Arbiter are concerned,
Article 223 of the Labor Code of the Philippines25 provides that,
"(d)ecisions, awards, or orders of the Labor Arbiter are final and executory
unless appealed to the [NLRC] by any or both parties within ten (10)
calendar days from the receipt of such decisions, awards or orders." In
case of a judgment involving a monetary award, the same provision
mandates that, "an appeal by the employer may be perfected only upon
the posting of a cash or surety bond issued by a reputable bonding
company duly accredited by the [NLRC] in the amount equivalent to the
monetary award in the judgment appealed from." Alongside the
requirement that "the appellant shall furnish a copy of the memorandum of
appeal to the other party," the foregoing requisites for the perfection of an
appeal are reiterated under Sections 1, 4 and 6, Rule VI of the NLRC Rules
364
365
366
Neither can petitioner evade said liabilities on the strength of the 28 July
2005 Decision rendered by the CA's Twenty-Second Division in CAG.R. SP
SO ORDERED.
367
II (Section 6) - - Sabotage
II (Section 12) - - Loss of Confidence
III (Section 2) - - Libel/Slander
III (Section 8 par. e) - - Other acts of Insubordination
On August 7, 2000, petitioner filed a complaint for illegal dismissal, nonpayment of overtime pay, holiday pay, service incentive leave pay,
unexpired vacation leave and 13th month pay and with prayer for moral
and actual damages. Subsequently, petitioner amended her complaint to
state the true date of her dismissal which is July 27, 2000 and not August
31, 2000. She averred that on the same day she was served with notice of
company closure, respondents barred her from reporting for work and paid
her last salary up to the end of July 2000.8
On September 18, 2000, petitioner received the following
memorandum9:ChanRoblesVirtualawlibrary
September 15, 2000
MEMO TO : MS. ESSENCIA MANARPIIS
Sales and Marketing Manager
Aroma Division
368
business losses were belied by TPIs financial documents. But despite her
pleas, she was asked to pack up her things and by the end of the month
her salary was discontinued. She then received the memorandum
regarding the company closure and was required to turn over the company
car, pager and cellphone. She was told not to report for work anymore. 10
After receiving the September 15, 2000 memorandum, petitioners counsel
sent a reply stating that there was no point in the investigation because
respondents already dismissed petitioner purportedly on the ground of
cessation of business due to insurmountable losses, and also it was
impossible for petitioner to respond to the charges which are devoid of
particulars as to the alleged irregularities she committed. It was pointed
out that respondents should have investigated the supposed violations of
company rules and fraudulent acts earlier and not when petitioner had
filed an illegal dismissal complaint.11
Subsequently, petitioner received the following
memorandum12:ChanRoblesVirtualawlibrary
September 25, 2000
TO : MS. ESSENCIA MANARPIIS
Sales and Marketing Manager
Aroma Division
SUBJECT : NOTICE OF TERMINATION
Ms. Manarpiis,
This is to inform you that your employment with the Company is
terminated effective today, September 25, 2000, due to Dishonesty, Loss
of Confidence, and Abandonment of Work.
An internal audit of the Company shows that several obligations of the
Company were paid twice to the same supplier. Considering the level of
your position, the inescapable conclusion is that you have colluded with
the Company supplier to defraud the Company of its finances.
Moreover, you have fraudulently caused to be reimbursed representation
expenses and other expense statements purporting to be that of your sales
representatives while in truth and in fact they were yours, and you
received the corresponding payments therefor.
Also, your attendance record showed that you have been absent without
official leave (AWOL) since August 3, 2000 up to date.
A notice of AWOL dated September 14, 2000 has been sent to you but you
refused to accept the same, much less, refused to act on it.
For your information and guidance
369
By Decision dated March 24, 2010, the CA reversed the NLRC and ruled
that petitioner was validly dismissed:ChanRoblesVirtualawlibrary
WHEREFORE, the petition is hereby GRANTED. The assailed Decision
dated January 25, 2008 and the Resolution dated September 22, 2008 of
the National Labor Relations Commission are hereby REVERSED and SET
ASIDE. Resultantly, Essencia Manarpiis complaint for illegal dismissal
against Texan Philippines, Inc., Richard Tan and Catherine Realubin-Tan is
hereby DISMISSED for lack of merit. No costs.
SO ORDERED.16
Petitioner filed a motion for reconsideration but it was denied by the CA.
Hence, this petition arguing that the CA committed patent reversible errors
when it: (1) granted the unverified/unsworn certification of non-forum
shopping accompanying respondents petition for certiorari; (2) granted
respondents petition for certiorari without finding any grave abuse of
discretion on the part of NLRC; (3) disturbed the consistent factual findings
of the LA and NLRC which were duly supported by substantial evidence and
devoid of any unfairness and arbitrariness; and (4) substituted its own
findings of facts to those of the LA and NLRC, the CAs findings being
unsupported by substantial evidence.17
The petition is meritorious.
We first address petitioners contention on the alleged formal infirmity of
the petition for certiorari filed before the CA. Petitioner argued that the
same was defective as the jurat therein was based on the mere community
tax certificate of respondent Rialubin-Tan, instead of a government-issued
identification card required under the 2004 Rules on Notarial Practice. Such
ground was never raised by herein petitioner in her comment on the CA
petition, thus, it cannot be validly raised by the petitioner at this stage. 18
Furthermore, we have consistently held that verification of a pleading is a
formal, not a jurisdictional, requirement intended to secure the assurance
that the matters alleged in a pleading are true and correct. Thus, the court
may simply order the correction of unverified pleadings or act on them and
waive strict compliance with the rules. It is deemed substantially complied
with when one who has ample knowledge to swear to the truth of the
allegations in the complaint or petition signs the verification; and when
matters alleged in the petition have been made in good faith or are true
and correct.19
Under the Rules of Court and settled doctrine, a petition for review on
certiorari under Rule 45 of the Rules of Court is limited to questions of law.
As a rule, the findings of fact of the CA are final and conclusive, and this
Court will not review them on appeal.20
However, there are instances in which factual issues may be resolved by
this Court, to wit: (1) the conclusion is a finding grounded entirely on
speculation, surmise and conjecture; (2) the inference made is manifestly
mistaken; (3) there is grave abuse of discretion; (4) the judgment is based
on a misapprehension of facts; (5) the findings of fact are conflicting; (6)
the CA goes beyond the issues of the case and its findings are contrary to
the admissions of both appellant and appellee; (7) the findings of fact of
the CA are contrary to those of the trial court; (8) said findings of facts are
conclusions without citation of specific evidence on which they are based;
(9) the facts set forth in the petition as well as in the petitioners main and
reply briefs are not disputed by the respondent; and (10) the findings of
fact of the CA are premised on the supposed absence of evidence and
contradicted by the evidence on record.21
Considering that the findings of facts and the conclusions of the CA are
contrary to those of the LA and the NLRC, we find it necessary to evaluate
such findings.
On the issue of illegal dismissal, both the LA and NLRC found no just or
authorized cause for the termination of petitioners employment.
LA Del Rosario observed that respondents flip-flopped on the issue of
petitioners termination as when they claimed she was dismissed due to
insurmountable losses so that TPIs personnel were notified of the
company closure effective August 31, 2000, and at the same time they
accused petitioner of fraudulent acts and abandonment of work resulting in
loss of trust and confidence which caused her dismissal. He also found
there was no compliance with the legal requisites of the said grounds for
dismissal under Article 283 (business closure) such as the lack of
termination report sent to the Department of Labor and Employment
(DOLE), financial documents which are audited and signed by an
independent auditor, and the two-notice requirement sent to the last
known address of the employee alleged to have abandoned work under
Book V, Rule XIV, Section 2 of the Omnibus Rules Implementing the Labor
Code. It was noted that while TPIs financial documents have BIR
stampmark, they were not shown to have been prepared by an
independent auditor.
The NLRC upheld the LAs ruling that petitioners dismissal was not
valid, viz:ChanRoblesVirtualawlibrary
As between the above, conflicting allegations, We find the version of the
complainant more credible. Record of the instant case would provide that
other than respondents bare allegations that complainant was instructed
to continue working even beyond 31 August 2000, no evidence was
presented to substantiate the same. If respondents could easily issue a
notice of business closure to all its employees, and at the same time,
immediately require the complainant to surrender all company properties
assigned to her, We could not understand why they could not easily issue
another letter, this time, intended only for the complainant informing her
that her employment was still necessary.
Relative to the companys closure due to business losses, prevailing
jurisprudence would dictate that the same should be substantiated by
370
371
372
employee, the scales of justice must be tilted in favor of the latter. The
employer must affirmatively show rationally adequate evidence that the
dismissal was for justifiable cause. Thus, when the breach of trust or
loss of confidence alleged is not borne by clearly established
facts, as in this case, such dismissal on the cited grounds cannot
be allowed.34 (Emphasis supplied)
The normal consequences of petitioners illegal dismissal are reinstatement
without loss of seniority rights, and payment of back wages computed from
the time compensation was withheld up to the date of actual
reinstatement. Where reinstatement is no longer viable as an option,
separation pay equivalent to one month salary for every year of service
should be awarded as an alternative. The payment of separation pay is in
addition to payment of back wages.35 Given the strained relations between
the parties, the award of separation pay, in lieu of reinstatement, is in
order.
Finally, on the solidary liability of respondents Richard Tan and Catherine
Rialubin-Tan for the monetary awards. It is basic that a corporation being a
juridical entity, may act only through its directors, officers and employees.
Obligations incurred by them, acting as such corporate agents are not
theirs but the direct accountabilities of the corporation they represent.
However, in certain exceptional situations, solidary liability may be
incurred by corporate officers. In labor cases for instance, this Court has
held corporate directors and officers solidarily liable with the corporation
for the termination of employment of employees done with malice or bad
faith.36
We sustain the NLRCs conclusion that the schemes implemented by the
respondents to justify petitioners baseless dismissal, and the manner by
which such schemes were effected showed malice and bad faith on their
part. Consequently, its affirmance of the order of the LA that the amounts
awarded to petitioner are payable in solidum by respondents is proper.
The NLRC likewise correctly upheld the award of attorneys fees
considering that petitioner was assisted by a private counsel to prosecute
her illegal dismissal complaint and enforce her rights under our labor laws.
WHEREFORE, the petition is GRANTED. The Decision dated March 24,
2010 and Resolution dated May 19, 2011 of the Court of Appeals in CA-G.R.
SP No. 106661 are hereby REVERSED and SET ASIDE.
The Decision dated June 28, 2001 of the Labor Arbiter in NLRC Case No. 0008-04110-2000, as affirmed by the Decision dated January 25, 2008 of the
National Labor Relations Commission in NLRC CA No. 029806-01, is
hereby REINSTATED.
No pronouncement as to costs.
SO ORDERED
373
April 7, 2014
while they were working very hard," and that she was "frequently absent,
under timing, and coming in late every time [Maquera] goes on leave or on
vacation."7
On November 16, 2006, Mapua obtained a summary of her attendance for
the last six months to prove that she did not have frequent absences or
under time when Maquera would be on leave or vacation. When shown to
Nolan, she was merely told not to give the matter any more importance
and to just move on.8
In December 2006, Mapua noticed that her colleagues began to ostracize
and avoid her. Nolan and Raina started giving out majority of her research
work and other duties under Healthcare and Legal Division to the rank-andfile staff. Mapua lost about 95% of her work projects and job
responsibilities.9
Mapua consulted these work problems with SPIs Human Resource Director,
Lea Villanueva (Villanueva), and asked if she can be transferred to another
department within SPI. Subsequently, Villanueva informed Mapua that
there is an intra-office opening and that she would schedule an exploratory
interview for her. However, due to postponements not made by Mapua, the
interview did not materialize.
On February 28, 2007, Mapua allegedly saw the new table of organization
of the Corporate Development Division which would be renamed as the
Marketing Division. The new structure showed that Mapuas level will be
again downgraded because a new manager will be hired and positioned
between her rank and Rainas.10
On March 21, 2007, Raina informed Mapua over the phone that her
position was considered redundant and that she is terminated from
employment effective immediately. Villanueva notified Mapua that she
should cease reporting for work the next day. Her laptop computer and
company mobile phone were taken right away and her office phone ceased
to function.11
Mapua was shocked and told Raina and Villanueva that she would sue
them. Mapua subsequently called her lawyer to narrate the contents of the
termination letter,12 which reads:
March 21, 2007
xxxx
Dear Ms. MAPUA,
374
xxxx
This notice of separation, effective March 21, 2007 should be regarded as
redundancy. Your separation pay will be computed as one months salary
for every year of service, a fraction of at least six months will be
considered as one year.
Your separation pay will be released on April 20, 2007 subject to your
clearance of accountabilities and as per Company policy.
x x x x13
Mapuas lawyer, in a phone call, advised Villanueva that SPI violated
Mapuas right to a 30-day notice.
On March 27, 2007, Mapua filed with the Labor Arbiter (LA) a complaint for
illegal dismissal, claiming reinstatement or if deemed impossible, for
separation pay. Afterwards, she went to a meeting with SPI, where she was
given a second termination letter,14 the contents of which were similar to
the first one.15
On April 25, 2007, Mapua received through mail, a third Notice of
Termination16 dated March 21, 2007 but the date of effectivity of the
termination was changed from March 21 to April 21, 2007. It further stated
that her separation pay will be released on May 20, 2007 and a notation
was inscribed, "refused to sign and acknowledge" with unintelligible
signatures of witnesses.
On May 13, 2007, a recruitment advertisement17 of SPI was published in
the Philippine Daily Inquirer (Inquirer advertisement, for brevity). It listed
all vacancies in SPI, including a position for Marketing Communications
Manager under Corporate Support the same group where Mapua
previously belonged.
SPI also sent a demand letter18 dated May 15, 2007 to Mapua, asking her
to pay for the remaining net book value of the company car assigned to
her under SPIs car plan policy. Under the said plan, Mapua should pay the
remaining net book value of her car if she resigns within five years from
start of her employment date.
In her Reply19 and Rejoinder,20 Mapua submitted an affidavit21 and alleged
that on July 16, 2007, Prime Manpower Resources Development (Prime
Manpower) posted an advertisement on the website of Jobstreet Philippines
for the employment of a Corporate Development Manager in an unnamed
Business Process Outsourcing (BPO) company located in Paraaque City.
Mapua suspected that this advertisement was for SPI because the writing
style used was similar to Rainas. She also claimed that SPI is the only BPO
office in Paraaque City at that time. Thereafter, she applied for the
position under the pseudonym of "Jeanne Tesoro". On the day of her
interview with Prime Manpowers consultant, Ms. Portia Dimatulac
(Dimatulac), the latter allegedly revealed to Mapua that SPI contracted
Prime Manpowers services to search for applicants for the Corporate
Development Manager position.
Because of these developments, Mapua was convinced that her former
position is not redundant. According to her, she underwent psychiatric
counseling and incurred medical expenses as a result of emotional
anguish, sleepless nights, humiliation and shame from being jobless. She
also averred that the manner of her dismissal was unprofessional and
incongruous with her rank and stature as a manager as other employees
have witnessed how she was forced to vacate the premises on the same
day of her termination.
On the other hand, SPI stated that the company regularly makes an
evaluation and assessment of its corporate/organizational structure due to
the unexpected growth of its business along with its partnership with
ePLDT and the acquisition of CyMed.22 As a result, SPI underwent a
reorganization of its structure with the objective of streamlining its
operations. This was embodied in an Inter-Office Memorandum 23 dated
August 28, 2006 issued by the companys Chief Executive Officer. 24 It was
then discovered after assessment and evaluation that the duties of a
Corporate Development Manager could be performed/were actually being
performed by other officers/managers/departments of the company. As
proof that the duties of Mapua are being/could be performed by other SPI
officers and employees, Villanueva executed an affidavit 25 attesting that
Mapuas functions are being performed by other SPI managers and
employees.
On March 21, 2007, the company, through Villanueva, served a written
notice to Mapua, informing her of her termination effective April 21, 2007.
Mapua refused to receive the notice, thus, Villanueva made a notation
"refused to sign and acknowledge" on the letter. On that same day, SPI
filed an Establishment Termination Report with the Office of the Regional
Director of the Department of Labor and Employment-National Capital
Region (DOLE-NCR) informing the latter of Mapuas termination. Mapua
was offered her separation and final pay, which she refused to receive.
Before the effective date of her termination, she no longer reported for
work. SPI has not hired a Corporate Development Manager since then.
SPI denied contracting the services of Prime Manpower for the hiring of a
Corporate Development Manager and emphasized that Prime Manpower
did not even state the name of its client in the Jobstreet website. SPI also
countered that Dimatulacs alleged revelation to Mapua that its client is SPI
must be struck down as mere hearsay because only Mapua executed an
affidavit to prove that such disclosure was made. While SPI admitted the
375
LA Decision
On October 24, 2008, the NLRC rendered its Decision,29 with the
fallo, as follows:
Backwages:
NLRC Ruling
03/21/07-06/30/08
P67,996 x 15.30 mos. =
P1,040,338.8
0
P520,169.40 P1,560,508.20
407,976.00
c)
Moral Damages:
P500,000.00
d)
Exemplary Damages:
250,000.00
e)
Attorneys Fees:
196,848.42
Total Award
P2,915,332.6
2
SO ORDERED.30
In ruling so, the NLRC held that "[t]he determination of whether
[Mapuas] position as Corporate Development Manager is
redundant is not for her to decide. It essentially and necessarily
lies within the sound business management."31 As early as August
28, 2006, Ernest Cu, SPIs Chief Executive Officer, announced the
corporate changes in the company.
A month earlier, the officers held their Senior Management
Strategic Planning Session with the theme, "Transformation" or reinvention of SPI purposely to create an organizational structure
that is streamlined, clear and efficient.32 In fact, Nolan and Raina,
Mapuas superiors were actually doing her functions with the
assistance of the pool of analysts, as attested to by Villanueva.
At odds with the NLRC decision, Mapua elevated the case to the
CA by way of petition for certiorari, arguing that based on
evidence, the LA decision should be reinstated.
CA Ruling
SO ORDERED.28
376
V
THE CA UPHELD THE [LAS] DECISION HOLDING INDIVIDUAL
PETITIONER SOLIDARILY AND PERSONALLY LIABLE TO
[MAPUA] WITHOUT SHOWING ANY BASIS THEREFOR37
Our Ruling
The Court sustains the CAs ruling.
Mapua was dismissed from employment supposedly due to
redundancy. However, she contended that her position as
Corporate Development Manager is not redundant. She cited that
SPI was in fact actively looking for her replacement after she was
terminated. Furthermore, SPI violated her right to procedural due
process when her termination was made effective on the same day
she was notified of it.
I
Article 283 of the Labor Code provides for the following:
THE CA DECLARED AS ILLEGAL [MAPUAS] SEPARATION
FROM SERVICE SOLELY ON THE BASIS OF HER SELFSERVING AND UNFOUNDED ALLEGATION OF A SUPPOSED
JOB ADVERTISEMENT
II
THE CA COMPLETELY DISREGARDED THE FACT THAT
[MAPUA] WAS VALIDLY SEPARATED FROM SERVICE ON THE
GROUND OF REDUNDANCY WHICH IS AN AUTHORIZED
CAUSE FOR TERMINATION OF EMPLOYMENT UNDER ARTICLE
283 OF THE LABOR CODE AND PREVAILING JURISPRUDENCE
III
THE CA FOUND THAT [MAPUA] WAS NOT ACCORDED HER
RIGHT TO DUE PROCESS IN UTTER DEROGATION OF THE
APPLICABLE PROVISIONS OF THE LABOR CODE AND THE
PERTINENT JURISPRUDENCE
IV
377
was taken away from her that very same day.41 To counter these
statements, SPI merely stated that before the effective date of
Mapuas termination on April 21, 2007, she no longer reported for
work. To this Court, this is insufficient rebuttal to the precise
narrative of Mapua.
On the matter of separation pay, there is no question that SPI
indeed offered separation pay to Mapua, but the offer must be
accompanied with good faith in the abolishment of the redundant
position and fair and reasonable criteria in ascertaining the
redundant position. It is insignificant that the amount offered to
Mapua is higher than what the law requires because the Court has
previously noted that "a job is more than the salary that it carries.
There is a psychological effect or a stigma in immediately finding
ones self laid off from work."42
Moving on to the issue of the validity of redundancy program, SPI
asserted that an employer has the unbridled right to conduct its
own business in order to achieve the results it desires. To prove
that Villanuevas functions are redundant, SPI submitted an InterOffice Memorandum43 and affidavit executed by its Human
Resources Director, Villanueva. The pertinent portions of the
memorandum read:
ORGANIZATION STRUCTURE
One of the most important elements of successfully effecting
change is to create an organization structure that is streamlined,
clear and efficient. We think we have done that and the new
format is illustrated in Attachment A. The upper part shows my
direct reports who are heads of the various shared services
departments and the lower part shows the set up of the business
units. The important features of the structure are discussed in the
following sections. For brevity, I have purposely not summarized
the roles that will remain the same.
xxxx
Corporate Development
Peter Maquera will continue to head Corporate Development but
the groups scope will be expanded to include Marketing across
the whole company. Essentially, Marketing will be taken out of the
business units and centralized under Corporate Development.
Elizabeth Nolan will move from her role as Publishings VP of Sales
and Marketing to become the head of Global Marketing. The unit
will continue to focus on strengthening the SPI brand, while at the
378
379
380
February 7, 1991
FELICIANO, J.:
Private respondent Vicente T. Ong was the Sales Manager of petitioner
Wiltshire File Co., Inc. ("Wiltshire") from 16 March 1981 up to 18 June 1985.
As such, he received a monthly salary of P14,375.00 excluding
commissions from sales which averaged P5,000.00 a month. He also
enjoyed vacation leave with pay equivalent to P7,187,50 per year, as well
as hospitalization privileges to the extent of P10,000.00 per year.
On 13 June 1985, upon private respondent's return from a business and
pleasure trip abroad, he was informed by the President of petitioner
Wiltshire that his services were being terminated. Private respondent
maintains that he tried to get an explanation from management of his
dismissal but to no avail. On 18 June 1985, when private respondent again
tried to speak with the President of Wiltshire, the company's security guard
handed him a letter which formally informed him that his services were
being terminated upon the ground of redundancy.
Private respondent filed, on 21 October 1985, a complaint before the Labor
Arbiter for illegal dismissal alleging that his position could not possibly be
redundant because nobody (save himself) in the company was then
performing the same duties. Private respondent further contended that
retrenching him could not prevent further losses because it was in fact
through his remarkable performance as Sales Manager that the Company
had an unprecedented increase in domestic market share the preceding
year. For that accomplishment, he continued, he was promoted to
Marketing Manager and was authorized by the President to hire four (4)
Sales Executives five (5) months prior to his termination.
In its answer, petitioner company alleged that the termination of
respondent's services was a cost-cutting measure: that in December 1984,
the company had experienced an unusually low volume of orders: and that
it was in fact forced to rotate its employees in order to save the company.
Despite the rotation of employees, petitioner alleged; it continued to
experience financial losses and private respondent's position, Sales
Manager of the company, became redundant.
On 2 December 1986, during the proceedings before the Labor Arbiter,
petitioner, in a letter1 addressed to the Regional Director of the then
Ministry of Labor and Employment, notified that official that effective 2
January 1987, petitioner would close its doors permanently due to
substantial business losses.
In a decision dated 11 March 1987, the Labor Arbiter declared the
termination of private respondent's services illegal and ordered petitioner
to pay private respondent backwages in the amount of P299,000.00,
unpaid salaries in the amount of P22,352.11, accumulated sick and
vacation leaves in the amount of P12,543.91, hospitalization benefit
package in the amount of P10,000.00, unpaid commission in the amount of
P57,500,00, moral damages in the amount of P100,000.00 and attorney's
fees in the amount of P51,639.60.
On appeal by petitioner Wiltshire, the National Labor Relations Commission
("NLRC") affirmed in toto on 9 February 1988 the decision of the Labor
Arbiter. The NLRC held that:
The termination letter clearly spelled out that the main reason in
terminating the services of complainant isREDUNDANT and not
retrenchment.
The supposed duplication of work of herein complainant and Mr.
Deliva, the Vice-President is absent that would justify redundancy. .
..
On the claim for moral damages, the NLRC pointed out that the effective
date of private respondent's termination was 18 July 1985, although it was
only 18 June 1985 that he received the letter of termination, and concluded
that he was not given any opportunity to explain his position on the matter.
The NLRC held that the termination was attended by malice and bad faith
on the part of petitioner, considering the manner of private respondent
was ordered by the President to pack up and remove his personal
belongings from the office. Private respondent was said to have been
embarrassed before his immediate family and other acquaintance due to
his inability to explain the reasons behind the termination of his services.
In this Petition for Certiorari, it is submitted that private respondent's
dismissal was justified and not illegal. Petitioner maintains that it had been
incurring business losses beginning 1984 and that it was compelled to
381
reduce the size of its personnel force. Petitioner also contends that
redundancy as a cause for termination does not necessarily mean
duplication of work but a "situation where the services of an employee are
in excess of what is demanded by the needs of an undertaking . . ."
Having reviewed the record of this case, the Court has satisfied itself that
indeed petitioner had serious financial difficulties before, during and after
the termination of the services of private respondent. For one thing, the
audited financial statements of the petitioner for its fiscal year ending on
31 July 1985 prepared by a firm of independent auditors, showed a net loss
in the amount of P4,431,321.00 and a total deficit or capital impairment at
the end of year of P6,776,493.00. 2
The employer has no legal obligation to keep in its payroll more employees
than are necessarily for the operation of its business.
In the preceding fiscal year (1983-1984), while the company showed a net
after tax income of P843,506.00, it actually suffered a deficit or capital
impairment of P2,345,172.00. Most importantly, petitioner Wiltshire finally
closed its doors and terminated all operations in the Philippines on January
1987, barely two (2) years after the termination of private respondent's
employment. We consider that finally shutting down business operations
constitutes strong confirmatory evidence of petitioner's previous financial
distress. The Court finds it very difficult to suppose that petitioner Wiltshire
would take the final and irrevocable step of closing down its operations in
the Philippines simply for the sole purpose of easing out a particular officer
or employee, such as the private respondent.
Turning to the legality of the termination of private respondent's
employment, we find merit in petitioner's basic argument. We are unable
to sustain public respondent NLRC's holding that private respondent's
dismissal was not justified by redundancy and hence illegal. In the first
place, we note that while the letter informing private respondent of the
termination of his services used the word "redundant", that letter also
referred to the company having "incur[red] financial losses which [in] fact
has compelled [it] to resort to retrenchment to prevent further losses". 3
Thus, what the letter was in effect saying was that because of financial
losses, retrenchment was necessary, which retrenchment in turn resulted
in the redundancy of private respondent's position.
In the second place, we do not believe that redundancy in an employer's
personnel force necessarily or even ordinarily refers to duplication of work.
That no other person was holding the same position that private
respondent held prior to the termination of his services, does not show that
his position had not become redundant. Indeed, in any well-organized
business enterprise, it would be surprising to find duplication of work and
two (2) or more people doing the work of one person. We believe that
redundancy, for purposes of our Labor Code, exists where the services of
an employee are in excess of what is reasonably demanded by the actual
requirements of the enterprise. Succinctly put, a position is redundant
In the third place, in the case at bar, petitioner Wiltshire, in view of the
contraction of its volume of sales and in order to cut down its operating
expenses, effected some changes in its organization by abolishing some
positions and thereby effecting a reduction of its personnel. Thus, the
position of Sales Manager was abolished and the duties previously
discharged by the Sales Manager simply added to the duties of the General
Manager, to whom the Sales Manager used to report.
It is of no legal moment that the financial troubles of the company were
not of private respondent's making. Private respondent cannot insist on the
retention of his position upon the ground that he had not contributed to the
financial problems of Wiltshire. The characterization of private
respondent's services as no longer necessary or sustainable, and therefore
properly terminable, was an exercise of business judgment on the part of
petitioner company. The wisdom or soundness of such characterization or
decision was not subject to discretionary review on the part of the Labor
Arbiter nor of the NLRC so long, of course, as violation of law or merely
arbitrary and malicious action is not shown. It should also be noted that the
position held by private respondent, Sales Manager, was clearly
managerial in character. In D.M. Consunji, Inc. v. National Labor Relations
Commission,5the Court held:
An employer has a much wider discretion in terminating the
employment relationship of managerial personnel as compared to
rank and file employees. However, such prerogative of
management to dismiss or lay off an employee must be made
without abuse of discretion, for what is at stake is not only the
private respondent's position but also his means of livelihood . . . . 6
The determination of the continuing necessity of a particular officer or
position in a business corporation is management's prerogative, and the
courts will not interfere with the exercise of such so long as no abuse of
discretion or merely arbitrary or malicious action on the part of
management is shown.7
On the issue of moral damages, petitioner assails the finding of the NLRC
that the dismissal was done in bad faith. Petitioner argues that it had
complied with the one-month notice required by law; that there was no
need for private respondent to be heard in his own defense considering
that the termination of his services was for a statutory or authorized cause;
382
xxx
xxx
383
This is not to say that the employee may not contest the reality or good
faith character of the retrenchment or redundancy asserted as grounds for
termination of services. The appropriate forum for such controversion
would, however, be the Department of Labor and Employment and not an
investigation or hearing to be held by the employer itself. It is precisely for
this reason that an employer seeking to terminate services of an employee
or employees because of "closure of establishment and reduction of
personnel", is legally required to give a written notice not only to the
employee but also to the Department of Labor and Employment at least
one month before effectivity date of the termination. In the instant case,
private respondent did controvert before the appropriate labor authorities
the grounds for termination of services set out in petitioner's letter to him
dated 17 June 1985.
We hold, therefore, that the NLRC's finding that private respondent had not
been accorded due process, is bereft of factual and legal bases. The award
of moral damages that rests on such ground must accordingly fall.
While private respondent may well have suffered personal embarrassment
by reason of termination of his services, such fact alone cannot justify the
award of moral damages. Moral damages are simply a species of damages
awarded to compensate one for injuries brought about by a wrongful
act.8 As discussed above, the termination of private respondent's services
was not a wrongful act. There is in this case no clear and convincing
evidence of record showing that the termination of private respondent's
services, while due to an authorized or statutory cause, had been carried
out in an arbitrary, capricious and malicious manner, with evident personal
ill-will. Embarrassment, even humiliation, that is not proximately caused by
a wrongful act does not constitute a basis for an award of moral damages.
Private respondent is, of course, entitled to separation pay and other
benefits under Act 283 of the Labor Code and petitioner's letter dated 17
June 1985.
ACCORDINGLY, the Court Resolved to GRANT due course to the Petition
for Certiorari. The Resolutions of the National Labor Relations Commission
dated 9 February 1988 and 7 March 1988 are hereby SET ASIDE and
NULLIFIED. The Temporary Restraining Order issued by this Court on 21
March 1988 is hereby made PERMANENT. No pronouncement as to costs.
SO ORDERED.
384
SYLLABUS
the functions of the pollution control and safety officer with the duties of
the Industrial Engineering Manager, as private respondent postulates, such
substitution was done in bad faith for as had already been pointed out,
Miguelito S. Navarro was hardly qualified for the position. If the aim was to
generate savings in terms of the salaries that PRC would not be paying the
petitioner any more as a result of the streamlining of operations for
improved efficiency, such a move could hardly be justified in the face of
PRCs hiring of ten (10) fresh graduates for the position of Management
Trainee and advertising for vacant positions in the Engineering/Technical
Division at around the time of the termination. Besides, there would seem
to be no compelling reason to save money by removing such an important
position. As shown by their recent financial statements, PRCs year-end net
profits had steadily increased from 1987 to 1990. While concededly, Article
283 of the Labor Code does not require that the employer should be
suffering financial losses before he can terminate the services of the
employee on the ground of redundancy, it does not mean either that a
company which is doing well can effect such a dismissal whimsically or
capriciously. The fact that a company is suffering from business losses
merely provides stronger justification for the termination.
3. ID.; ID.; RIGHT OF EMPLOYEE ILLEGALLY DISMISSED; RULE; CASE AT BAR.
Since We have concluded that the petitioners dismissal was illegal and
can not be justified under a valid redundancy initiative, Article 283 of the
Labor Code, as amended, on the benefits to be received by the dismissed
employee in the case of redundancy, retrenchment to prevent losses,
closure of business or the installation of labor saving devices, is not
applicable. Instead, We apply Article 279 thereof which provides, in part,
that an "employee who is unjustly dismissed from work shall be entitled to
reinstatement without loss of seniority rights and other privileges and to
his full backwages, inclusive of allowances, and to his other benefits or
their monetary equivalent computed from the time his compensation was
withheld from him up to the time of his actual reinstatement.
4. ID.; RIGHT OF EMPLOYEE TO SECURITY OF TENURE; CONSTRUED IN CASE
AT BAR. It is evident that petitioners right to security of tenure was
violated by the private respondent PRC. Both the Constitution (Section 3,
Article XIII) and the Labor Code (Article 279, P.D. 442, as amended)
enunciate this right as available to an employee. In a host of cases, this
Court has upheld the employees right to security of tenure in the face of
oppressive management behavior and management prerogative. (Dosch v.
NLRC, 123 SCRA 296 [1983]; Tolentino v. NLRC, 152 SCRA 717 [1987]; Cebu
Royal Plant v. Deputy Minister of Labor, 153 SCRA 38 [1987]; PT&T v. NLRC,
183 SCRA 451 [1990]; Filipinas Manufacturers Bank v. NLRC, 182 SCRA 848
[1990]; Batongbacal v. Associated Bank, 168 SCRA 600 [1988];
International Harvester Macleod v. NLRC, 149 SCRA 641 [1987]; Remerco
Garments v. Minister of Labor, 135 SCRA 167 [1985]; Cebu Royal Plant v.
Deputy Minister of Labor, 153 SCRA 38 [1987]) Security of tenure is a right
which may not be denied on mere speculation of any unclear and nebulous
basis. (Tolentino v. NLRC, 152 SCRA 717 [1987]) In this regard, it could be
concluded that the respondent PRC was merely in a hurry to terminate the
385
Petitioner seeks to set aside the Decision 1 dated 14 January 1991 and the
Resolution 2 dated 13 May 1991 of the respondent National Labor
Relations Commission (hereinafter, NLRC) in NLRC Case No. 00-08-0341288 entitled Orlando M. Escareal v. Philippine Refining Company, Inc. The
said Decision affirmed with modification the 19 February 1990 Decision 3
of the respondent Labor Arbiter Manuel P. Asuncion while the Resolution
denied the motion for a reconsideration of the former.cralawnad
The dispositive portion of the respondent Labor Arbiters Decision
reads:jgc:chanrobles.com.ph
"WHEREFORE, the respondent is hereby ordered to pay the complainant his
redundancy pay in accordance with existing company policy on the matter.
This is without prejudice to the grant of additional benefits offered by the
respondent during the negotiation stage of the case, though it never
materialized for failure of the parties to reach an agreement.
SO ORDERED."cralaw virtua1aw library
The controversy stemmed from the dismissal of the petitioner from the
private respondent Philippine Refining Company, Inc. (hereinafter, PRC)
after almost eleven (11) years of gainful employment.
Petitioner was hired by the PRC for the position of Pollution Control
Manager effective on 16 September 1977 with a starting monthly pay of
P4,230 00; 4 the employment was made permanent effective on 16 March
1978. 5 The contract of employment provides, inter alia, that his
"retirement date will be the day you reach your 60th birthday, but there is
provision (sic) for voluntary retirement when you reach your 50th birthday.
Bases for the hiring of the petitioner are Letter of Instruction (LOI) No. 588
implementing the National Pollution Control Decree, P.D No. 984, dated 19
August 1977, the pertinent portion of which reads:jgc:chanrobles.com.ph
"1. All local governments, development authorities, government-owned or
controlled corporations, industrial, commercial and manufacturing
establishments, and all other public and private entities, whose functions
involve the discharge or emission of pollutants into the water, air and/or
land resources or the operation, installation or construction of any antipollution device, treatment work or facility, sewerage or sewerage disposal
system, shall each appoint and/or designate a Pollution Control
Officer." chanrobles law library
and Memorandum Circular No. 02, 6 dated 3 August 1981 and
implementing LOI No. 588, which amended Memorandum Circular No. 007,
Series of 1977, issued by the National Pollution Control Commission
(NPCC), the pertinent portions of which read:jgc:chanrobles.com.ph
DECISION
386
Petitioner protested his dismissal via his 22 June 1988 letter to Javelona. 10
This notwithstanding, the PRC unilaterally circulated a clearance 11 dated
12 July 1988, to take effect on 15 July 1988, indicating therein that its
purpose is for the petitioners "early retirement" and not redundancy.
Petitioner confronted Javelona; the latter, in his letter dated 13 July 1988,
advised the former that the employment would be extended for another
month, or up to 15 August 1988. 12 Petitioner responded with a letter
dated 25 July 1988 threatening legal action. 13
ARTICLE 162. Safety and Health Standard. The Secretary of Labor shall,
by appropriate orders, set and enforce mandatory occupational safety and
health standards to eliminate or reduce occupational safety and health
hazards in all workplaces and institute new, and update existing, programs
to ensure safe and healthful working conditions in all places of
387
388
TOTAL P445,321.80"
389
390
specific point, all that the private respondent has to say is that the
declaration of redundancy was made pursuant to its continuing program,
which has been ongoing for the past ten (10) years, of streamlining the
personnel complement and maintaining a lean and effective organization.
35
Furthermore, if PRC felt that either the petitioner was incompetent or that
the task could be performed by someone more qualified, then why is it that
the person designated to the position hardly had any experience in the
field concerned? And why reward the petitioner, barely five (5) months
before the dismissal, with an increase in salary? Assuming PRCs good
faith, it would still seem quite surprising that it did not at least provide a
transition period wherein the Industrial Engineering Manager would be
adequately trained for his new assignment; such reckless conduct is not
the expected behavior of a well-oiled and progressive multinational
company. Petitioner himself could have very well supervised a training and
familiarization program which could have taken the remaining three (3)
years of his employment. But no such move was initiated. Instead, a clever
scheme to oust the petitioner from a position held for so long was hatched
and implemented. On the very same day of petitioners termination, the
position vacated was resurrected and reconstituted as a component of the
position of Industrial Engineering Manager. After more than ten (10) years
of unwavering service and loyalty to the company, the petitioner was so
cruelly and callously dismissed.chanrobles.com:cralaw:red
What transpired then was a substitution of the petitioner by Miguelito S.
Navarro. If based on the ground of redundancy, such a move would be
invalid as the creation of said position is mandated by the law; the same
cannot therefore be declared redundant. If the change was effected to
consolidate the functions of the pollution control and safety officer with the
duties of the Industrial Engineering Manager, as private respondent
postulates, such substitution was done in bad faith for as had already been
pointed out, Miguelito S. Navarro was hardly qualified for the position. If
the aim was to generate savings in terms of the salaries that PRC would
not be paying the petitioner any more as a result of the streamlining of
operations for improved efficiency, such a move could hardly be justified in
the face of PRCs hiring of ten (10) fresh graduates for the position of
Management Trainee 36 and advertising for vacant positions in the
Engineering/Technical Division at around the time of the termination. 37
Besides, there would seem to be no compelling reason to save money by
removing such an important position. As shown by their recent financial
statements, PRCs year-end net profits had steadily increased from 1987 to
1990. 38 While concededly, Article 283 of the Labor Code does not require
that the employer should be suffering financial losses before he can
terminate the services of the employee on the ground of redundancy, it
does not mean either that a company which is doing well can effect such a
dismissal whimsically or capriciously. The fact that a company is suffering
from business losses merely provides stronger justification for the
termination.
391
be availed of when the employee reaches his 50th birthday. Clearly, the
cited provision is limited solely to the pertinent issue of retirement." 45
is correct.
An examination of the contents of the contract of employment 46 yields
the conclusion arrived at by the Solicitor General. There is no indication
that PRC intended to offer uninterrupted employment until the petitioner
reached the mandatory retirement age, it merely informs the petitioner of
the compulsory retirement age and the terms pertaining to the retirement.
In Brent School, Inc. v. Zamora, 47 this Court, in upholding the validity of a
contract of employment with a fixed or specific period, declared that the
"decisive determinant in term employment should not be the activities that
the employee is called upon to perform, but the day certain agreed upon
by the parties for the commencement and termination of their employment
relationship, a day certain being understood to be that which must
necessarily come, although it may not be known when." 48 The term
period was further defined to be, "Length of existence; duration. A point of
time marking a termination as of a cause or an activity; an end, a limit, a
bound; conclusion; termination. A series of years, months or days in which
something is completed. A time of definite length. . . . the period from one
fixed date to another fixed date . . ." 49
The letter to the petitioner confirming his appointment does not
categorically state when the period of employment would end. It stands to
reason then that petitioners employment was not one with a specific
period.chanrobles law library
Coming to the third assigned error, since We have concluded that the
petitioners dismissal was illegal and can not be justified under a valid
redundancy initiative, Article 283 of the Labor Code, as amended, on the
benefits to be received by the dismissed employee in the case of
redundancy, retrenchment to prevent losses, closure of business or the
installation of labor saving devices, is not applicable. Instead, We apply
Article 279 thereof which provides, in part, that an "employee who is
unjustly dismissed from work shall be entitled to reinstatement without
loss of seniority rights and other privileges and to his full backwages,
inclusive of allowances, and to his other benefits or their monetary
equivalent computed from the time his compensation was withheld from
him up to the time of his actual reinstatement."cralaw virtua1aw library
In Torillo v. Leagardo, Jr., 50 an amplification was made on Article 279 of
the Labor Code and the distinction between separation pay and
backwages. Citing the case of Santos v. NLRC, 51 We held in the
former:jgc:chanrobles.com.ph
"The normal consequences of a finding that an employee has been illegally
dismissed are, firstly, that the employee becomes entitled to reinstatement
to his former position without loss of seniority rights and, secondly, the
392
SO ORDERED
393
MEDIALDEA, J.:
This Petition for certiorari seeks to annul and set aside the resolution
issued by the respondent National Labor Relations Commission on July 8,
1991, in Certified Case No. 0548 entitled "In Re: Labor Dispute at Baliwag
Mahogany Corporation," affirming with modification its previous decision
dated October 23, 1990, declaring the union officers and/or members who
participated in the illegal strike staged on February 6, 1990 to have lost
their status of employment; and directing private respondent Baliwag
Mahogany Corporation to pay separation pay to certain employees and to
reinstate without backwages all union Members not found to have
committed prohibited acts.
The antecedent facts are as follows:
Petitioners Cecile de Ocampo, Wilfredo San Pedro, Reynaldo Dovicar, Bien
Medina, Cesar Abriol, Artemio Castro, Larry Alcantara, Michael Nocum,
Jesus Deo, Jr., Publeo Darag, Eduardo Bino, Eduardo Veles, Ervin David,
Prostacio Perez, Noel Victor, Eleno Dacatimban, Antonio Bernardo, Carlito
Victoria, Timoteo Mijares, Alex Ramos, Reynaldo Cruz, Modesto Mamesia,
Domingo Silarde, Renato Puertas, Rene Villanueva, Marcelo dela Cruz and
Hernando Legaspi are employees of private respondent Baliwag Mahogany
Corporation. They are either officers or members of the Baliwag Mahogany
Corporation Union-CFW, the existing collective bargaining agent of the
rank and file employees in the company. Private respondent Baliwag
394
On February 25, 1990, the company caused the publication of his return to
work order in two (2) newspapers, namely NGAYON and ABANTE.
In its letter dated February 27, 1990, the union, through its President Cecile
de Ocampo, requested the Regional Director of DOLE, Region III to
intervene in the existing dispute with management.
Subsequently, in a letter dated January 28, 1990, the union requested for
the presence of a NCMB representative during a strike vote held by the
union. The strike vote resulted to 388 votes out of 415 total votes in favor
of the strike.
Meanwhile, the company extended the February 26, 1990 deadline for the
workers to return to work until March 15, 1990.
The respondent Commission rendered a decision on October 23, 1990,
declaring the strikes staged on January 18, 1990 and February 6, 1990
illegal, the dispositive portion of which provides as follows, to wit:
395
1. Cecile de Ocampo
2. Wilfredo San Pedro
3. Reynaldo Aguilar
4. Bren Medina (Bien Medina)
5. Cesar Abriol
6. Artemio Castro
7. Larry Alcantara
8. Melie Nocum (Michael Nocum)
9. Jesus Deo, Jr.
10. Publeo Darag
11. Eduardo Bino
12. Eduardo Vices (Eduardo Veles)
13. Abroin David (Ervin David)
14. Protacio Perez (Prostacio Perez)
15. Celso Sarmiento
16. Neol Vicbon (Noel Victor)
17. Alano Dacatimban (Eleno Dacatimban)
18. Antonio Bernardo
19. Carlito Victoria
20. Timoteo Mijares
21. Alex Ramos
22. Reynaldo Cruz
23. Modesto Manesia
24. Domingo Silarde
25. Renato Puertas
26. Hernando Legaspi
2. The Baliwag Mahogany Corporation is directed to pay
Cecile de Ocampo, Rene Villanueva and Marcelo Cruz
separation pay computed at one month per year of service
in addition to one month pay as indemnification pay for
lack of notice (Art. 283, Labor Code).
3. The Baliwag Mahogany Corporation is directed to pay
Alex Ramos, Reynaldo Cruz, Renato Puertas, Hernando
Legaspi separation pay computed at one (1) month per
year of service in addition to backwages limited to six (6)
months.
4. The Baliwag Mahogany Corporation is directed to
reinstate but without backwages all Union members not
found herein to have committed prohibited acts nor found
396
Moreover, the Solicitor General maintains that the illegality of the strike
likewise stems from the failure of the petitioners to honor the certification
order and heed the return-to-work order issued by the Secretary of Labor.
Answering this contention, the petitioners argued that their failure to
immediately return to work was not impelled by any malicious or
malevolent motive but rather, by their apprehension regarding their
physical safety due to the presence of military men in the factory who
might cause them harm.
The law on the matter is Article 264 (a) of the Labor Code, to wit:
Article 264. (a) Prohibited activities. (a)
No strike or lockout shall be declared after assumption of
jurisdiction by the President or the Minister or after
certification or submission of the dispute to compulsory or
voluntary arbitration or during the pendency of cases
involving the same grounds for the strike or lockout.
Any worker whose employment has been terminated as a
consequence of an unlawful lockout shall be entitled to
reinstatement with full backwages. Any union officer who
knowingly participates in an illegal strike and any worker or
union officer who knowingly participates in the commission
of illegal acts during a strike may be declared to have lost
his employment status: Provided, That mere participation
of a worker in a lawful strike shall not constitute sufficient
ground for termination of his employment, even if a
replacement had been hired by the employer during such
lawful strike.
The clear mandate of the aforequoted article was stressed in the case
of Union of Filipro Employees v. Nestle Philippines, Inc. (G.R. Nos. 8871013, December 19, 1990, 192 SCRA 396, 411) where it was held that a
strike that is undertaken despite the issuance by the Secretary of Labor of
an assumption or certification order becomes a prohibited activity and thus
illegal, pursuant to the second paragraph of Art. 264 of the Labor Code as
Amended and the Union officers and members, as a result, are deemed to
have lost their employment status for having knowingly participated in an
illegal act.
397
398
SO ORDERED.
399
extension of his leave. At the end of his week-long absence, Sahot applied
for extension of his leave for the whole month of June, 1994. It was at this
time when petitioners allegedly threatened to terminate his employment
should he refuse to go back to work.
At this point, Sahot found himself in a dilemma. He was facing
dismissal if he refused to work, But he could not retire on pension because
petitioners never paid his correct SSS premiums. The fact remained he
could no longer work as his left thigh hurt abominably. Petitioners ended
his dilemma. They carried out their threat and dismissed him from work,
effective June 30, 1994. He ended up sick, jobless and penniless.
On September 13, 1994, Sahot filed with the NLRC NCR Arbitration
Branch, a complaint for illegal dismissal, docketed as NLRC NCR Case No.
00-09-06717-94. He prayed for the recovery of separation pay and
attorneys fees against Vicente Sy and Trinidad Paulino-Sy, Belen Paulino,
Vicente Sy Trucking, T. Paulino Trucking Service, 6Bs Trucking and SBT
Trucking, herein petitioners.
For their part, petitioners admitted they had a trucking business in the
1950s but denied employing helpers and drivers. They contend that
private respondent was not illegally dismissed as a driver because he was
in fact petitioners industrial partner. They add that it was not until the year
1994, when SBT Trucking Corporation was established, and only then did
respondent Sahot become an employee of the company, with a monthly
salary that reached P4,160.00 at the time of his separation.
Petitioners further claimed that sometime prior to June 1, 1994, Sahot
went on leave and was not able to report for work for almost seven
days. On June 1, 1994, Sahot asked permission to extend his leave of
absence until June 30, 1994. It appeared that from the expiration of his
leave, private respondent never reported back to work nor did he file an
extension of his leave. Instead, he filed the complaint for illegal dismissal
against the trucking company and its owners.
Petitioners add that due to Sahots refusal to work after the expiration
of his authorized leave of absence, he should be deemed to have
voluntarily resigned from his work. They contended that Sahot had all the
time to extend his leave or at least inform petitioners of his health
condition. Lastly, they cited NLRC Case No. RE-4997-76, entitled Manuelito
Jimenez et al. vs. T. Paulino Trucking Service, as a defense in view of the
400
alleged similarity in the factual milieu and issues of said case to that of
Sahots, hence they are in pari material and Sahots complaint ought also to
be dismissed.
The NLRC NCR Arbitration Branch, through Labor Arbiter Ariel
Cadiente Santos, ruled that there was no illegal dismissal in Sahots case.
Private respondent had failed to report to work. Moreover, said the Labor
Arbiter, petitioners and private respondent were industrial partners before
January 1994. The Labor Arbiter concluded by ordering petitioners to pay
financial assistance of P15,000 to Sahot for having served the company as
a regular employee since January 1994 only.
On appeal, the National Labor Relations Commission modified the
judgment of the Labor Arbiter. It declared that private respondent was an
employee, not an industrial partner, since the start. Private respondent
Sahot did not abandon his job but his employment was terminated on
account of his illness, pursuant to Article 284 [9] of the Labor Code.
Accordingly, the NLRC ordered petitioners to pay private respondent
separation pay in the amount of P60,320.00, at the rate of P2,080.00 per
year for 29 years of service.
Petitioners assailed the decision of the NLRC before the Court of
Appeals. In its decision dated February 29, 2000, the appellate court
affirmed with modification the judgment of the NLRC. It held that private
respondent was indeed an employee of petitioners since 1958. It also
increased the amount of separation pay awarded to private respondent to
P74,880, computed at the rate of P2,080 per year for 36 years of service
from 1958 to 1994. It decreed:
WHEREFORE, the assailed decision is hereby AFFIRMED with
MODIFICATION. SB Trucking Corporation is hereby directed to pay
complainant Jaime Sahot the sum of SEVENTY-FOUR THOUSAND EIGHT
HUNDRED EIGHTY (P74,880.00) PESOS as and for his separation pay. [10]
Hence, the instant petition anchored on the following contentions:
I
RESPONDENT COURT OF APPEALS IN PROMULGATING THE QUESTION[ED]
DECISION AFFIRMING WITH MODIFICATION THE DECISION OF NATIONAL
LABOR RELATIONS COMMISSION DECIDED NOT IN ACCORD WITH LAW AND
PUT AT NAUGHT ARTICLE 402 OF THE CIVIL CODE. [11]
II
RESPONDENT COURT OF APPEALS VIOLATED SUPREME COURT RULING
THAT THE NATIONAL LABOR RELATIONS COMMISSION IS BOUND BY THE
FACTUAL FINDINGS OF THE LABOR ARBITER AS THE LATTER WAS IN A
BETTER POSITION TO OBSERVE THE DEMEANOR AND DEPORTMENT OF THE
WITNESSES IN THE CASE OF ASSOCIATION OF INDEPENDENT UNIONS IN
THE PHILIPPINES VERSUS NATIONAL CAPITAL REGION (305 SCRA 233).[12]
III
PRIVATE RESPONDENT WAS NOT DISMISS[ED] BY RESPONDENT SBT
TRUCKING CORPORATION.[13]
Three issues are to be resolved: (1) Whether or not an employeremployee relationship existed between petitioners and respondent Sahot;
(2) Whether or not there was valid dismissal; and (3) Whether or not
respondent Sahot is entitled to separation pay.
Crucial to the resolution of this case is the determination of the first
issue. Before a case for illegal dismissal can prosper, an employeremployee relationship must first be established.[14]
Petitioners invoke the decision of the Labor Arbiter Ariel Cadiente
Santos which found that respondent Sahot was not an employee but was in
fact, petitioners industrial partner.[15] It is contended that it was the Labor
Arbiter who heard the case and had the opportunity to observe the
demeanor and deportment of the parties. The same conclusion, aver
petitioners, is supported by substantial evidence. [16] Moreover, it is argued
that the findings of fact of the Labor Arbiter was wrongly overturned by the
NLRC when the latter made the following pronouncement:
We agree with complainant that there was error committed by the Labor
Arbiter when he concluded that complainant was an industrial partner prior
to 1994. A computation of the age of complainant shows that he was only
twenty-three (23) years when he started working with respondent as truck
helper. How can we entertain in our mind that a twenty-three (23) year old
man, working as a truck helper, be considered an industrial partner. Hence
we rule that complainant was only an employee, not a partner of
respondents from the time complainant started working for respondent. [17]
401
On this point, we affirm the findings of the appellate court and the
NLRC. Private respondent Jaime Sahot was not an industrial partner but an
employee of petitioners from 1958 to 1994. The existence of an employeremployee relationship is ultimately a question of fact [23] and the findings
thereon by the NLRC, as affirmed by the Court of Appeals, deserve not only
respect but finality when supported by substantial evidence. Substantial
evidence is such amount of relevant evidence which a reasonable mind
might accept as adequate to justify a conclusion. [24]
Time and again this Court has said that if doubt exists between the
evidence presented by the employer and the employee, the scales of
justice must be tilted in favor of the latter. [25]Here, we entertain no
doubt. Private respondent since the beginning was an employee of, not an
industrial partner in, the trucking business.
Coming now to the second issue, was private respondent validly
dismissed by petitioners?
Petitioners contend that it was private respondent who refused to go
back to work. The decision of the Labor Arbiter pointed out that during the
conciliation proceedings, petitioners requested respondent Sahot to report
back for work. However, in the same proceedings, Sahot stated that he
was no longer fit to continue working, and instead he demanded
separation pay. Petitioners then retorted that if Sahot did not like to work
as a driver anymore, then he could be given a job that was less strenuous,
such as working as a checker. However, Sahot declined that suggestion.
Based on the foregoing recitals, petitioners assert that it is clear that Sahot
was not dismissed but it was of his own volition that he did not report for
work anymore.
In his decision, the Labor Arbiter concluded that:
While it may be true that respondents insisted that complainant continue
working with respondents despite his alleged illness, there is no direct
evidence that will prove that complainants illness prevents or incapacitates
him from performing the function of a driver. The fact remains that
complainant suddenly stopped working due to boredom or otherwise when
he refused to work as a checker which certainly is a much less strenuous
job than a driver.[26]
But dealing the Labor Arbiter a reversal on this score the NLRC,
concurred in by the Court of Appeals, held that:
402
While it was very obvious that complainant did not have any intention to
report back to work due to his illness which incapacitated him to perform
his job, such intention cannot be construed to be an abandonment.
Instead, the same should have been considered as one of those falling
under the just causes of terminating an employment. The insistence of
respondent in making complainant work did not change the scenario.
It is worthy to note that respondent is engaged in the trucking business
where physical strength is of utmost requirement (sic). Complainant
started working with respondent as truck helper at age twenty-three (23),
then as truck driver since 1965. Complainant was already fifty-nine
(59) when the complaint was filed and suffering from various illness
triggered by his work and age.
x x x[27]
In termination cases, the burden is upon the employer to show by
substantial evidence that the termination was for lawful cause and validly
made.[28] Article 277(b) of the Labor Code puts the burden of proving that
the dismissal of an employee was for a valid or authorized cause on the
employer, without distinction whether the employer admits or does not
admit the dismissal.[29] For an employees dismissal to be valid, (a) the
dismissal must be for a valid cause and (b) the employee must be afforded
due process.[30]
Article 284 of the Labor Code authorizes an employer to terminate an
employee on the ground of disease, viz:
Art. 284. Disease as a ground for termination- An employer may terminate
the services of an employee who has been found to be suffering from any
disease and whose continued employment is prohibited by law or
prejudicial to his health as well as the health of his co-employees: xxx
However, in order to validly terminate employment on this ground,
Book VI, Rule I, Section 8 of the Omnibus Implementing Rules of the Labor
Code requires:
Sec. 8. Disease as a ground for dismissal- Where the employee suffers
from a disease and his continued employment is prohibited by law or
prejudicial to his health or to the health of his co-employees, the employer
shall not terminate his employment unless there is a certification by
competent public health authority that the disease is of such nature or at
such a stage that it cannot be cured within a period of six (6) months even
with proper medical treatment. If the disease or ailment can be cured
within the period, the employer shall not terminate the employee but shall
ask the employee to take a leave. The employer shall reinstate such
employee to his former position immediately upon the restoration of his
normal health. (Italics supplied).
As this Court stated in Triple Eight integrated Services, Inc. vs. NLRC,
the requirement for a medical certificate under Article 284 of the Labor
Code cannot be dispensed with; otherwise, it would sanction the unilateral
and arbitrary determination by the employer of the gravity or extent of the
employees illness and thus defeat the public policy in the protection of
labor.
[31]
In the case at bar, the employer clearly did not comply with the
medical certificate requirement before Sahots dismissal was effected. In
the same case of Sevillana vs. I.T. (International) Corp., we ruled:
Since the burden of proving the validity of the dismissal of the employee
rests on the employer, the latter should likewise bear the burden of
showing that the requisites for a valid dismissal due to a disease have
been complied with. In the absence of the required certification by a
competent public health authority, this Court has ruled against the validity
of the employees dismissal. It is therefore incumbent upon the private
respondents to prove by the quantum of evidence required by law that
petitioner was not dismissed, or if dismissed, that the dismissal was not
illegal; otherwise, the dismissal would be unjustified. This Court will not
sanction a dismissal premised on mere conjectures and suspicions, the
evidence must be substantial and not arbitrary and must be founded on
clearly established facts sufficient to warrant his separation from work. [32]
In addition, we must likewise determine if the procedural aspect of
due process had been complied with by the employer.
From the records, it clearly appears that procedural due process was
not observed in the separation of private respondent by the management
of the trucking company. The employer is required to furnish an employee
with two written notices before the latter is dismissed: (1) the notice to
apprise the employee of the particular acts or omissions for which his
dismissal is sought, which is the equivalent of a charge; and (2) the notice
informing the employee of his dismissal, to be issued after the employee
has been given reasonable opportunity to answer and to be heard on his
defense.[33] These, the petitioners failed to do, even only for record
403
404
ROMEO VILLARUEL,
Petitioner,
-versus-
Present:
Promulgated:
almost twenty (20) years, the company changed its name four times.
June 1, 2011
the
company
was
operating
under
the
name
of
Yuhans
12, 1998, he reported for work but was no longer permitted to go back
because of his illness; he asked that respondent allow him to continue
DECISION
working but be assigned a lighter kind of work but his request was denied;
instead, he was offered a sum of P15,000.00 as his separation pay;
PERALTA, J.:
however, the said amount corresponds only to the period between 1993
Assailed in the present petition are the Decision
of the
Court of Appeals (CA) dated February 16, 2005 and August 2, 2005,
from his first day of employment in June 1963, but respondent refused.
Aside from separation pay, petitioner prayed for the payment of service
[1]
and Resolution
[2]
On the other hand, respondent averred in his Position Paper [5] that
petitioner was hired as machine operator from March 1, 1993 until he
On February 15, 1999, herein petitioner filed with the NLRC, National
for work, but he never showed up. Respondent was later caught by
surprise when petitioner filed the instant case for recovery of separation
[3]
405
petitioner and that during their mandatory conference, he even told the
Respondent filed a Motion for Reconsideration, [8] but the same was denied
Respondent then filed with the CA a petition for certiorari under Rule 65 of
the Rules of Court.
On November 27, 2000, the Labor Arbiter handling the case rendered
judgment in favor of petitioner. The dispositive portion of the Labor
disposing as follows:
Herein petitioner filed his Motion for Reconsideration [11] of the CA Decision,
but it was denied by the CA via a Resolution[12] dated August 2, 2005.
On March 31, 2003, the Third Division of the NLRC rendered its
Decision[7] dismissing respondent's appeal and affirming the Labor Arbiter's
Decision.
II
406
by law or is prejudicial to his health as well as to the health of his coemployees. It does not contemplate a situation where it is the employee
who severs his or her employment ties. This is precisely the reason why
Section 8,[14] Rule 1, Book VI of the Omnibus Rules Implementing the Labor
Code, directs that an employer shall not terminate the services of the
employee unless there is a certification by a competent public health
authority that the disease is of such nature or at such a stage that it
cannot be cured within a period of six (6) months even with proper medical
treatment.
Hence, the pivotal question that should be settled in the present case is
The Court finds the petition without merit.
The assigned errors in the instant petition essentially boil down to the
question of whether petitioner is entitled to separation pay under the
provisions of the Labor Code, particularly Article 284 thereof, which reads
as follows:
An employer may terminate the services of an employee
who has been found to be suffering from any disease and
whose continued employment is prohibited by law or is
prejudicial to his health as well as to the health of his coemployees: Provided, That he is paid separation pay
equivalent to at least one (1) month salary or to one-half ()
month salary for every year of service whichever is greater,
a fraction of at least six months being considered as one
(1) whole year.
A perusal of the Decisions of the Labor Arbiter and the NLRC would show,
however, that there was no discussion with respect to the abovementioned
issue. Both lower tribunals merely concluded that petitioner is entitled to
separation pay under Article 284 of the Labor Code without any
explanation. The Court finds no convincing justification, in the Decision of
the Labor Arbiter on why petitioner is entitled to such pay. In the same
manner, the NLRC Decision did not give any rationalization as the gist
thereof simply consisted of a quoted portion of the appealed Decision of
the Labor Arbiter.
On the other hand, the Court agrees with the CA in its observation of the
following circumstances as proof that respondent did not terminate
407
petitioner's
original
and
amended
complaints
and
position
paper;
Labor Code and its implementing rules and regulations nor the exceptions
apply because petitioner was not dismissed from his employment and
In consonance with the above findings, the Court finds that petitioner was
the one who initiated the severance of his employment relations with
Since petitioner was not terminated from his employment and, instead, is
[15]
Citing Eastern Shipping Lines, Inc. v. Sedan,[20] this Court, in the more
situations dealt with in Article 283[16] of the same Code and under Section 4
(b), Rule I, Book VI of the Implementing Rules and Regulations of the said
Code[17] where there is illegal dismissal and reinstatement is no longer
feasible. By way of exception, this Court has allowed grants of separation
pay to stand as a measure of social justice where the employee is validly
dismissed for causes other than serious misconduct or those reflecting on
his moral character.[18] However, there is no provision in the Labor Code
which grants separation pay to voluntarily resigning employees. In fact, the
rule is that an employee who voluntarily resigns from employment is not
entitled to separation pay, except when it is stipulated in the employment
contract or CBA, or it is sanctioned by established employer practice or
policy.[19] In the present case, neither the abovementioned provisions of the
408
409
him financial assistance. Hence, based on the foregoing, the Court finds
that the award of P50,000.00 to petitioner as financial assistance is
deemed equitable under the circumstances.
SO ORDERED.
410
versus
RODANTE YNSON,
Respondent.
x-----------------------------------------------------------------------------------------x
DECISION
PERALTA, J.:
Before this Court is a Petition for Review on Certiorari under Rule 45 of the
Rules of Court, seeking to set aside the Decision [1] dated July 13, 2006 and
On
March
27,
2003,
Dr.
Daniel
de
la
Paz,
Neurologist-
June 4, 2003, Dr. De la Paz certified that respondent may return to work,
but advised him to continue with his rehabilitation regimen for another
411
him that his request for detail in Davao was disapproved, as petitioner did
was diagnosed with primary hypertension, diabetes mellitus II, S/P stroke
not have any branch in Davao and there was no available administrative
on June 4, 2003, and recommended that the latter should continue with his
work for him. Meanwhile, petitioner company bewailed that its sales
suffered, as nobody was performing the duties of the NSM and the office
space reserved for respondent remained vacant.
Later, Ricanor sent two letters, [12] dated July 4, 2003 and July 31,
a.m., and August 18, 2003, respectively. Both letters reiterated the
work be given to him while in Davao City, until completion of his therapy.
contents of his first letter to respondent dated June 12, 2003, but included
dismissal.
In his letters[13] dated July 21, 2003 and August 12, 2003,
respondent
reiterated
the
reasons
for
his
inability
to
attend
the
the following alleged violations: (1) absences without leave since January
24, 2003 to date, and (2) abandonment of work. In a letter[10] dated June
26, 2003, respondent replied that his attending physician advised him to
refrain from traveling, in order not to disrupt his daily schedule for therapy
and medication.
412
Petitioner and Ricanor appealed to the NLRC (Cagayan de Oro City), which
Resolution[17] dated July 29, 2005, reducing the total awards of moral and
illegal dismissal and non-payment of allowances, with claim for moral and
On August 26, 2005, petitioner and Ricanor filed their Motion for
Reconsideration.[18]
petitioner
and
Ricanor
filed
before
the
CA
Petition
On July 13, 2006, the CA rendered a Decision, [20] finding the petition partly
meritorious. It found that petitioner had the right to terminate the
employment of respondent, and that it had observed due process in
terminating his
of
to
pay
respondent
the
following
amounts: P1,225,000.00
413
(representing his salary from February 2003 to August 29, 2003), medical
expenses of P94,100.00, temperate damages of P100,000.00, 13th month
award.
The CA ruled that pursuant to Article 284 of the Labor Code, respondents
illness is considered an authorized cause to justify his termination from
Petitioner filed this present Petition for Review on Certiorari, raising the
following assignment of errors:
employment. The CA ruled that although petitioner did not comply with the
medical certificate requirement before respondents dismissal was effected,
this was offset by respondent's absence for more than the six (6)-month
period that the law allows an employee to be on leave in order to recover
I.
THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR
WHEN IT AWARDED P1,225,000.00 REPRESENTING THE
PRIVATE RESPONDENTS MONTHLY SALARY OFP175,000.00
FROM FEBRUARY 2003 TO AUGUST 29, 2003.
II.
THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR
WHEN IT AWARDED MEDICAL EXPENSES OF P94,100.00 TO
THE PRIVATE RESPONDENT.
III.
THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR
WHEN IT AWARDED TEMPERATE DAMAGES OF P100,000.00
IN FAVOR OF THE PRIVATE RESPONDENT.
IV.
THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR
WHEN IT AWARDED 13TH MONTH PAY OF P175,000.00 IN
FAVOR OF THE PRIVATE RESPONDENT.
V.
from an ailment.
We agree. With regard to disease as a ground for termination, Article 284
of the Labor Code provides that an employer may terminate the services of
an employee who has been found to be suffering from any disease and
whose continued employment is prohibited by law or is prejudicial to his
health, as well as to the health of his co-employees.
414
In Triple Eight Integrated Services, Inc. v. NLRC,[23] the Court held that the
requirement for a medical certificate under Article 284 of the Labor Code
cannot be dispensed with; otherwise, it would sanction the unilateral and
arbitrary determination by the employer of the gravity or extent of the
employees illness and, thus, defeat the public policy on the protection of
labor. In the present case, there was no showing that prior to terminating
respondent's employment, petitioner secured the required certification
from a competent public health authority that the disease he suffered was
of such nature or at such a stage that it cannot be cured within six months
despite proper medical treatment, pursuant to Section 8, Rule I, Book VI of
the Omnibus Rules Implementing the Labor Code.
July 25, 2003 for investigation; and letter [27] dated July 31, 2003, requiring
respondent to appear for the hearing and investigation on August 18,
2003, respondent refused to report to his office, either to resume work or
attend the investigations set by the petitioner. Even considering the
directive of respondent's doctor to continue with his present regimen for at
least another month and a half, it could be safely deduced that, counted
from June 4, 2003, respondent's rehabilitation regimen ended on July 19,
2003. Despite the completion of his treatment, respondent failed to attend
the investigations set on July 25, 2003 and August 18, 2003. Thus, his
unexplained absence in the proceedings should be construed as waiver of
his right to be present therein in order to adduce evidence that would have
justified his continued absence from work.
had
been
undergoing
physical
rehabilitation,
and
recommended that he may resume work, but the nature of his work had to
be modified so as to give time for his strengthening and maintenance
program. Thus,
415
Being the NSM, respondent should have reported back to work or attended
the investigations conducted by petitioner immediately upon being
permitted to work by his doctors, knowing that his position remained
protecting the rights of the laborers, authorizes neither oppression nor selfdestruction of the employer. The worker's right to security of tenure is not
an absolute right, for the law provides that he may be dismissed for cause.
[31]
vacant for a considerable length of time. During his absence, nobody was
performing the duties of NSM, which included, among others, supervising
416
confidence of his employer would suffice for his dismissal. [32] Needless to
that where the employee's failure to work was occasioned neither by his
rightfully shifted to the employer; each party must bear his own loss. [36] In
2003, was neither due to petitioners fault nor due to his willful conduct, but
because he suffered a stroke on January 24, 2003. Hence, each must bear
employer should uniformly apply so that it can expect compliance with the
same rules and regulations by its other employees. Otherwise, the rules
necessary and proper for the operation of its business would be gradually
allow respondent to recover something he has not earned and count not
have earned, since he could not discharge his work as NSM. Petitioner
business.
rule governing the relation between labor and capital, or management and
employee, of a fair day's wage for a fair day's labor remains as the basic
the employee, there can be no wage or pay unless, of course, the laborer
was able, willing and ready to work but was illegally locked out, suspended
attorneys fees of 10% of the total monetary award, but deleted the award
417
leave for the duration that he did not report to work, the period should
but must be actually proved with a reasonable degree of certainty. [41] The
We agree. Being entitled to sick leave pay during the time that respondent
for the purchase of medicines and other medical supplies necessary for his
was incapable of working, the Court deems it best that the reckoning date
should be from January 24, 2003 [38] to June 4, 2003[39] (not from February
the form of official receipts, to show the exact cost of his medication, and
2003 to August 29, 2003 as ruled by the CA), he may be entitled to salary,
chargeable against his accrued sick leave benefits and other similar leave
petitioner.
the amount of P94,100.00, merely on the basis of the Certification [40] dated
other competent evidence to prove the actual expenses incurred, the CA's
March 27, 2003 of Dr. De la Paz, which states that respondent spent
approximately P350.00
daily
on
medicines
and
that
his
continued
rehabilitation would cost P250.00 per day. It contends that the bare
Under Article 2224 of the Civil Code, temperate or moderate damages are
more than nominal but less than compensatory, and may be recovered
when the court finds that some pecuniary loss has been suffered, but the
amount cannot, from the nature of the case, be proved with certainty. The
CA found that respondent paid for the doctor's professional fees and
incurred other hospital expenses; however, the records failed to show that
competent proof and on the best evidence obtainable by the injured party,
of P100,000.00.
418
reckoned from June 5, 2003 (i.e., the day after he was declared fit to return
However, We reduce the amount of temperate damages awarded by the
to work, but failed to do so), and lack of evidence that his dismissal was
tainted with bad faith, the grant of 10% of the total monetary award as
by respondent was not debilitating in nature and the records showed that
Anent the CA's ruling that respondent should be entitled to 13 th month pay,
We clarify that the 13th Month Pay Law, which provides the rules on the
amount either full or pro-rated amount of the 13 th month pay, if any, that
he would be entitled to. Thus, reference should be made in consonance
with the existing company policy on the payment of the 13 th month
pay vis--vis the number of days that he actually worked.
On the matter of attorney's fees, We have ruled that attorney's fees may
be awarded only when the employee is illegally dismissed in bad faith, and
is compelled to litigate or incur expenses to protect his rights by reason of
the unjustified acts of his employer. [45] In view of Our findings that
respondent was validly dismissed for unauthorized absences, amounting to
gross dereliction of duties under Article 282 (e) of the Labor Code,
419
420
On 8 August 1996 Singson filed a complaint with the Labor Arbiter for
illegal dismissal with prayer for reinstatement asserting that he was
dismissed from his employment without prior notice and hearing. [2] On the
contrary, HANTEX averred that Singson was not dismissed but abandoned
his job after he was reprimanded.
On 5 May 1998 the Labor Arbiter rendered a decision finding private
respondent Singson to have been illegally dismissed and ordering HANTEX
to reinstate him to his former or substantially equivalent position, as well
as to pay him P234,848.38 as backwages and P8,992.60 as 13th month
pay.[3]
HANTEX appealed to the National Labor Relations Commission (NLRC),
which affirmed the Labor Arbiter's finding of illegal dismissal but ordered
the reduction of backwages, holding that the computation thereof should
start not from the date complainant was hired in 1994 as held by the Labor
Arbiter, but from the date he was illegally dismissed in 1996. The NLRC
observed The respondents would want us to believe that on August 5, 1996, they
merely reprimanded complainant for his poor performance (p. 10, Appeal,
p. 109, Record). However, they have not submitted any proof thereon,
unlike on November 21, 1995 when they sent him a memorandum, which
he duly received, calling attention to his work deportment x x x x Just
because respondent asked him to assume duties during the hearing before
the Labor Arbiter on September 30, 1996 (p. 7, Record) does not
necessarily prove that they in fact did not dismiss him in the first place. On
the contrary, that offer could be a tacit admission of respondents that they
erred in dismissing him verbally and without observance of both
substantive and procedural due process x x x x On the matter of
complainants alleged abandonment x x x xsuffice it to say that his mere
filing of a case for illegal dismissal already negates the theory of
abandonment x x x x However, we find merit in respondents argument
regarding the award of backwages. Indeed, it was glaring error to base the
computation thereof from the date complainant was hired in 1994. Rather,
the computation should
start from the date he was found to have been illegally dismissed x x x x [4]
On 8 June 2000 HANTEX and/or Mariano Chua, undaunted by reverses,
elevated the case to the Court of Appeals on a petition for
certiorari[5] arguing that: (a) the complaint for illegal dismissal was a mere
ploy of private respondent to get back at them; (b) there was no
421
422
423
in the amount equivalent to one (1) month pay for every year of service,
backwages computed from 5 August 2002, the time his compensation was
withheld from him, up to the finality of this decision, plus the accrued 13th
month pay.
SO ORDERED.
424
formed
theDamayan
at Conductor-Transport
Department
of
Labor
Workers
and
ng
Union
mga
and
Manggagawa,
registered
Employment. Pending
the
it
Tsuper
with
holding
the
of
DECISION
The KKTI employees later organized the Kaisahan ng mga Kawani sa King
VELASCO, JR., J.:
of Kings (KKKK) which was registered with DOLE. Respondent was elected
KKKK president.
of the
and submit it to the company after each trip. As a background, this report
Court of Appeals (CA) in CA-GR SP No. 81961. Said judgment affirmed the
indicates the ticket opening and closing for the particular day of duty. After
Kings Transport, Inc. (KKTI), but ordered the bus company to pay full
[2]
[1]
rejecting
The Facts
the employee.
audit
of
the October
28,
2001 Conductors
Report
of
425
income of eight hundred and ninety pesos. While no irregularity report was
percentage basis.
unintentional. He explained that during that days trip, the windshield of the
bus assigned to them was smashed; and they had to cut short the trip in
order to immediately report the matter to the police. As a result of the
Aggrieved,
respondent
appealed
to
the
National
Labor
Relations
company. KKTI also cited as basis for respondents dismissal the other
SO ORDERED.[7]
alleged
that
his
dismissal
was
intended
to
bust
union
due process.
The Ruling of the Court of Appeals
In
its April
3,
2002 Position
Paper,[5] KKTI
contended
that
Affirming the NLRC, the CA held that there was just cause for respondents
dismissal. It ruled that respondents act in declaring sold tickets as returned
tickets x x x constituted fraud or acts of dishonesty justifying his dismissal.
[9]
426
[10]
In the present case, the CA affirmed the findings of the labor arbiter and
a just cause. This ruling is not at issue in this case. The question to be
determined is whether the procedural requirements were complied with.
employment, thus:
Art. 277. Miscellaneous Provisions.x x x
(b) Subject to the constitutional right of workers to
security of tenure and their right to be protected against
dismissal except for a just and authorized cause without
prejudice to the requirement of notice under Article 283 of
this Code, the employer shall furnish the worker whose
employment is sought to be terminated a written notice
containing a statement of the causes for termination and
shall afford the latter ample opportunity to be heard and to
defend himself with the assistance of his representative if
he so desires in accordance with company rules and
regulations promulgated pursuant to guidelines set by the
Department of Labor and Employment. Any decision taken
by the employer shall be without prejudice to the right of
the worker to contest the validity or legality of his dismissal
by filing a complaint with the regional branch of the
427
the
Omnibus
Rules
means
every
kind
of
assistance
that
(a)
A written notice served on the
employee specifying the ground or grounds
for termination, and giving said employee
reasonable opportunity within which to
explain his side.
defenses they will raise against the complaint. Moreover, in order to enable
description of the charge will not suffice. Lastly, the notice should
specifically mention which company rules, if any, are violated and/or which
among the grounds under Art. 282 is being charged against the
employees.
(2) After serving the first notice, the employers should schedule and
conduct a hearing or conference wherein the employees will be given
the opportunity to: (1) explain and clarify their defenses to the charge
against them; (2) present evidence in support of their defenses; and (3)
rebut the evidence presented against them by the management. During
the hearing or conference, the employees are given the chance to defend
employees:
428
reports did not even state a company rule or policy that the employee had
employers
of
termination of employment under Art. 282 of the Labor Code. Thus, KKTIs
against the employees have been considered; and (2) grounds have been
shall
serve
the
employees
a written
notice
hearing
was
conducted. Regardless
of
respondents
written explanation, a hearing was still necessary in order for him to clarify
substantially complied with the rules, claiming that respondent would not
have issued a written explanation had he not been informed of the charges
against him.[17]
[16]
indicating as grounds, not only hisOctober 28, 2001 infraction, but also his
previous infractions.
of the charges against an employee does not comply with the first notice
As stated earlier, after a finding that petitioners failed to comply
requirement. In Pepsi Cola Bottling Co. v. NLRC,[18] the Court held that
consultations or conferences are not a substitute for the actual observance
of notice and hearing. Also, in Loadstar Shipping Co., Inc. v. Mesano,[19] the
with the due process requirements, the CA awarded full backwages in favor
of respondent in accordance with the doctrine in Serrano v. NLRC.
[20]
Court,
sanctioning
the employer
for
disregarding
the
due
process
requirements, held that the employees written explanation did not excuse
the fact that there was a complete absence of the first notice.
However,
the
doctrine
in Serrano had
already
been
abandoned
429
Section
of
the
Rules
Implementing
Presidential
Decree
No.
On the other hand, in his Complaint, [24] respondent admitted that he was
851[22] provides the exceptions in the coverage of the payment of the 13th-
pay benefit.
WHEREFORE, the petition is PARTLY GRANTED and the September 16,
xxxx
No costs.
Petitioner KKTI maintains that respondent was paid on purely
commission basis; thus, the latter is not entitled to receive the 13th-month
pay
benefit. However,
applying
the
ruling
in Philippine
Agricultural
SO ORDERED.
430
After
due
proceedings,
the
Labor
Arbiter
rendered
a
decision[3] declaring the termination illegal and ordering JAKA and its HRD
Manager to reinstate respondents with full backwages, and separation pay
if reinstatement is not possible. More specifically the decision dispositively
reads:
WHEREFORE, judgment is hereby rendered declaring as illegal the
termination of complainants and ordering respondents to reinstate them to
their positions with full backwages which as of July 30, 1998 have already
amounted to P339,768.00. Respondents are also ordered to pay
complainants the amount of P2,775.00 representing the unpaid service
incentive leave pay of Parohinog, Lescano and Cagabcab an the amount of
P19,239.96 as payment for 1997 13th month pay as alluded in the above
computation.
If complainants could not be reinstated, respondents are ordered to pay
them separation pay equivalent to one month salary for very (sic) year of
service.
SO ORDERED.
Therefrom, JAKA went on appeal to the NLRC, which, in a decision
dated August 30, 1999,[4] affirmed in toto that of the Labor Arbiter.
JAKA filed a motion for reconsideration. Acting thereon, the NLRC
came out with another decision dated January 28, 2000,[5] this time
modifying its earlier decision, thus:
WHEREFORE, premises considered, the instant motion for reconsideration
is hereby GRANTED and the challenged decision of this Commission
[dated] 30 August 1999 and the decision of the Labor Arbiter xxx are
hereby modified by reversing an setting aside the awards of backwages,
service incentive leave pay. Each of the complainants-appellees shall be
entitled to a separation pay equivalent to one month. In addition,
respondents-appellants is (sic) ordered to pay each of the complainantsappellees the sum of P2,000.00 as indemnification for its failure to observe
due process in effecting the retrenchment.
SO ORDERED.
431
turn, is one of the just causes enumerated under Article 282 of the Labor
Code. In said case, we upheld the validity of the dismissal despite noncompliance with the notice requirement of the Labor Code. However, we
required the employer to pay the dismissed employees the amount of
P30,000.00, representing nominal damages for non-compliance with
statutory due process, thus:
Where the dismissal is for a just cause, as in the instant case, the lack of
statutory due process should not nullify the dismissal, or render it illegal, or
ineffectual. However, the employer should indemnify the employee for the
violation of his statutory rights, as ruled in Reta vs. National Labor
Relations Commission. The indemnity to be imposed should be stiffer to
discourage the abhorrent practice of dismiss now, pay later, which we
sought to deter in the Serrano ruling. The sanction should be in the nature
of indemnification or penalty and should depend on the facts of each case,
taking into special consideration the gravity of the due process violation of
the employer.
xxx xxx xxx
The violation of petitioners right to statutory due process by the private
respondent warrants the payment of indemnity in the form of nominal
damages. The amount of such damages is addressed to the sound
discretion of the court, taking into account the relevant
circumstances. Considering the prevailing circumstances in the case
at bar, we deem it proper to fix it at P30,000.00. We believe this form
of damages would serve to deter employers from future violations of the
statutory due process rights of employees. At the very least, it provides a
vindication or recognition of this fundamental right granted to the latter
under the Labor Code and its Implementing Rules, (Emphasis supplied).
The difference between Agabon and the instant case is that in the
former, the dismissal was based on a just cause under Article 282 of the
Labor Code while in the present case, respondents were dismissed due to
retrenchment, which is one of the authorized causes under Article 283 of
the same Code.
At this point, we note that there are divergent implications of a
dismissal for just cause under Article 282, on one hand, and a dismissal for
authorized cause under Article 283, on the other.
432
A dismissal for just cause under Article 282 implies that the
employee concerned has committed, or is guilty of, some violation against
the employer, i.e. the employee has committed some serious misconduct,
is guilty of some fraud against the employer, or, as in Agabon, he has
neglected his duties. Thus, it can be said that the employee himself
initiated the dismissal process.
On another breath, a dismissal for an authorized cause under Article
283 does not necessarily imply delinquency or culpability on the part of the
employee. Instead, the dismissal process is initiated by the employers
exercise of his management prerogative, i.e. when the employer opts to
install labor saving devices, when he decides to cease business operations
or when, as in this case, he undertakes to implement a retrenchment
program.
The clear-cut distinction between a dismissal for just cause under
Article 282 and a dismissal for authorized cause under Article 283 is further
reinforced by the fact that in the first, payment of separation pay, as a
rule, is not required, while in the second, the law requires payment of
separation pay.[9]
For these reasons, there ought to be a difference in treatment when
the ground for dismissal is one of the just causes under Article 282, and
when based on one of the authorized causes under Article 283.
Accordingly, it is wise to hold that: (1) if the dismissal is based on a
just cause under Article 282 but the employer failed to comply with the
notice requirement, the sanction to be imposed upon him should
be tempered because the dismissal process was, in effect, initiated by an
act imputable to the employee; and (2) if the dismissal is based on an
authorized cause under Article 283 but the employer failed to comply with
the notice requirement, the sanction should be stiffer because the
dismissal process was initiated by the employers exercise of his
management prerogative.
The records before us reveal that, indeed, JAKA was suffering from
serious business losses at the time it terminated respondents employment.
As aptly found by the NLRC:
A careful study of the evidence presented by the respondent-appellant
corporation shows that the audited Financial Statement of the corporation
for the periods 1996, 1997 and 1998 were submitted by the respondent-
433
434
EN BANC
Acting
on
an alleged
unsigned
letter
regarding
anomalous
team to investigate the matter. It was discovered that the Shipping Section
jacked up the value of the freight costs for goods shipped and that the
duplicates
of
of
- v e r s u s - CORONA,
CARPIO MORALES,
TINGA,
CHICO-NAZARIO,
VELASCO, JR.,
NACHURA,
LEONARDO-DE CASTRO,
BRION and
PERALTA, JJ.
PHILIPPINE TELEGRAPH AND
TELEPHONE COMPANY and
JOSE LUIS SANTIAGO,
Respondents. Promulgated:
April 7, 2009
x-------------------------------------------------x
DECISION
CORONA, J.:
435
tampering
with
the
shipping
documents.
Respondents
we
find
respondents
evidence
insufficient
to
clearly
and
suspended for only 15 days (without stating the reason for the reduction of
convincingly establish the facts from which the loss of confidence resulted.
the period of petitioners illegal suspension).[6]
[10]
Other than their bare allegations and the fact that such documents
illegal suspension for 15 days and dismissal for just cause were concerned.
procedure in the handling and approval of shipping requests and the fact
436
worker with two written notices: (1) a written notice specifying the grounds
employee.[11]
explain his side and (2) another written notice indicating that, upon due
consideration of all circumstances, grounds have been established to
enjoy under the Constitution and the Labor Code. The employers evidence
in the absence of a hearing in which they could have explained their side
must clearly and convincingly show the facts on which the loss of
437
conflict,
the
law
prevails
over
the
administrative
regulations
proceeds from the law itself. To be valid, a rule or regulation must conform
to and be consistent with the provisions of the enabling statute. [19]As such,
it cannot amend the law either by abridging or expanding its scope. [20]
438
this extent, Section 2(d), Rule I of the Implementing Rules of Book VI of the
Labor Code is in conformity with Article 277(b).
[24]
439
This Court has consistently ruled that the due process requirement
in cases of termination of employment does not require an actual or formal
hearing. Thus, we categorically declared in Skippers United Pacific, Inc. v.
Maguad:[25]
The Labor Code does not, of course, require a formal
or trial type proceeding before an erring employee
may be dismissed. (emphasis supplied)
440
employer. This not only respects the power vested in the Secretary of
respond to the charges against him, adduce his evidence or rebut the
Labor and Employment to promulgate rules and regulations that will lay
After receiving the first notice apprising him of the charges against
that [a]ll doubts in the implementation and interpretation of the provisions
him, the employee may submit a written explanation (which may be in the
of [the Labor Code], including its implementing rules and regulations shall
form of a letter, memorandum, affidavit or position paper) and offer
be resolved in favor of labor.
evidence in support thereof, like relevant company records (such as his
201 file and daily time records) and the sworn statements of his witnesses.
For this purpose, he may prepare his explanation personally or with the
441
from the time the compensation was not paid up to the time of actual
because of the length of time that has passed from the date of the incident
December
27,
there was no due process, Article 279 of the Labor Code, as amended,
mandates that the employee is entitled to reinstatement without loss of
seniority rights and other privileges and full backwages, inclusive of
NLRC
NCR
SO ORDERED
in
CN.
11-06930-93
is
1995
442
SYLLABUS
1. REMEDIAL LAW; EVIDENCE; HEARSAY EVIDENCE RULE; THE COPY OF AN
OFFICIAL ENTRY IN THE SHIP CAPTAIN'S LOGBOOK CAN BE USED AS A
VITAL EVIDENCE IN THE DISMISSAL OF RESPONDENT SEAMEN
PROVIDED THAT AN INVESTIGATION WAS CONDUCTED BEFORE THE
DISMISSAL. - We agree with petitioners that the ship captain's logbook
is a vital evidence as Article 612 of the Code of Commerce requires
him to keep a record of the decisions he had adopted as the vessel's
head. Thus, in Haverton Shipping Ltd. v. NLRC, the Court held that a
copy of an official entry in the logbook is legally binding and serves as
an exception to the hearsay rule. However, the Haverton Shipping
ruling does not find unqualified application in the case at bar. In said
case, an investigation of the incident which led to the seamen's
dismissal was conducted before he was dismissed.Consequently, the
facts appearing in the logbook were supported by the facts gathered
at the investigation. In this case, because no investigation was
conducted by the ship captain before repartriating private respondent,
the contents of the logbook have to be duly identified and
authenticated lest an injustice result from a blind adoption of such
contents which merely serve as prima facie evidence of the incident in
question. Moreover, what was presented in the Haverton Shipping
case was a copy of the official entry from the logbook itself. In this
case, petitioners did not submit as evidence to the POEA the logbook
itself, or even authenticated copies of pertinent pages thereof, which
could have been easily xeroxed or photocopied considering the
present technology on reproduction of documents. What was offered
in evidence was merely a typewritten collation of excerpts from what
could be the logbook because by their format, they could have been
lifted from other records kept in the vessel in accordance with Article
612 of the Code of Commerce.
2. LABOR AND SOCIAL LEGISLATION; LABOR CODE; TERMINATION OF
EMPLOYMENT; EMPLOYER'S PREROGATIVE TO DISMISS OR LAY-OFF AN
EMPLOYEE; SUBJECT TO REGULATION BY THE STATE IN THE EXERCISE
OF ITS POLICE POWER. - An employer may dismiss or lay off an
employee only for the just an authorized causes enumerated in
Articles 282 and 283 of the Labor Code. However, this basic and
normal prerogative of an employer is subject to regulation by the
State in the exercise of its paramount police power inasmuch as the
preservation of lives of citizens, as well as their means of lievelihood,
is a basic duty of the State more vital than the preservation of
443
5. ID.; ID.; ID.; ID.; CANNOT BE DISPENSED WITH BY THE MERE FACT THAT
THE SHIP CAPTAIN WITNESSED THE ALTERCATION. - Neither is the ship
captain's having witnessed the altercation an excuse for dispensing
with the notice and hearing requirements. Serving notice to private
respondent under the circumstances cannot be regarded as an
"absurdity and superfluity."
6. ID.; ID.; CONTRACT OF EMPLOYMENT; STRICTLY INTERPRETED IN FAVOR
OF LABOR. - In this regard, it should be clarified that this Court does
not tolerate nor sanction assault in any form. Physical violence against
anyone at anytime and any place is reprehensible. However, in cases
such as this, where a person's livelihood is at stake, strict
interpretation of the contract of employment in favor of the worker
must be observed to affirm the constitutional provision on protection
to labor.
[G.R. No. 108433. October 15, 1996]
WALLEM
MARITIME
SERVICES,
INC.
and
WALLEM
SHIPMANAGEMENT LTD., petitioners, vs. NATIONAL LABOR
RELATIONS
COMMISSION
and
JOSELITO
V.
MACATUNO, respondents.
DECISION
ROMERO, J.:
This petition for certiorari seeks to annul and set aside the
Resolution[1] of the National Labor Relations Commission (NLRC) affirming
the Decision[2] of the Philippine Overseas Employment Administration
(POEA) which disposed of POEA Case No. (M)89-09-865 as follows:
WHEREFORE, in view of the foregoing, respondents Wallem Maritime
Services, Inc. and Wallem Shipmanagement Ltd. are hereby ordered jointly
and severally, to pay complainant the following in Philippine currency at
the prevailing rate of exchange at the time of payment:
a) THREE HUNDRED THREE US DOLLARS
(US$303.00) representing salary for the month of June
1989;
444
445
446
[18]
In other words, Mr. V.S. Sason was merely a learner or a trainee and not
a regular officer on board M/T Fortuna.
In this regard, it should be clarified that this Court does not tolerate
nor sanction assault in any form. Physical violence against anyone at any
time and any place is reprehensible.However, in cases such as this, where
a persons livelihood is at stake, strict interpretation of the contract of
employment in favor of the worker must be observed to affirm the
constitutional provision on protection to labor.
On the issue of due process . . ., the law requires the employer to furnish
the worker whose employment is sought to be terminated a written notice
containing a statement of the cause or causes for termination and shall
afford him ample opportunity to be heard and to defend himself with the
assistance of a representative. Specifically, the employer must furnish the
worker with two (2) written notices before termination of employment can
be legally effected: (a) notice which apprises the employee of the
particular acts or omissions for which his dismissal is sought; and (b) the
subsequent notice which informs the employee of the employers decision
to dismiss him. (Underscoring supplied.)[22]
447
QUIRICO LOPEZ,
Petitioner,
- versus
ALTURAS
GROUP
OF
COMPANIES
and/or MARLITO UY,
Respondents.
Finding
petitioners
explanation
unsatisfactory,
respondent
Notice,
Promulgated:
sold, in conspiracy with one Maritess Alaba, for his own benefit to thus
prompt it to file a criminal case for Qualified Theft [3] against him before the
Regional Trial Court (RTC) of Bohol. It had in fact earlier filed another
criminal case for Qualified Theft[4] against petitioner arising from the theft
DECISION
CARPIO MORALES, J.:
dismissal; that the filing of the charge came about after he reported the
loss of the original copy of his pay slip, which report, he went on to claim,
respondent company took to mean that he could use the pay slip as
evidence for filing a complaint for violation of labor laws; and that on
Isuzu Cargo Aluminum Van with Plate Number PHP 271 that was then
into executing an affidavit that if the pay slip is eventually found, it could
security guard that he was taking out the scrap iron consisting of lift
pendency of the criminal case involving the scrap iron did not warrant the
was justified, for he, a truck driver, held a position of trust and confidence,
and his act of stealing company property was a violation of the trust
reposed upon him.
448
supervisor
Arbiter noted that on the basis of the records, petitioner had been paid the
Motorpool.
and
junior
supervisor,
respectively,
of
its
Supermarket
Division
by
(Cebu
Decision
[6]
City) set
aside the
Labor
Arbiters
Decision
did not suffice to warrant the termination of petitioners services; and that
petitioners alleged admission of taking the scrap iron was belied by his
vehement denial, as even the security guard, one Gerardo Luega, who
Albeit the appellate court found that petitioners dismissal was for a
just cause, it held that due process was not observed when respondent
admission was made, did not even execute an affidavit in support thereof.
show-cause
letter
and
any
so-called
investigation but
without
By Report[9] of December 18, 2009, the appellate court reversed the NLRC
ruling. It held that respondent company was justified in terminating
petitioners employment on the ground of loss of trust and confidence, his
alleged act of smuggling out the scrap iron having been sufficiently
449
constitutes
substantive
due
process,
and
the
legality
of
breached
Petitioner, a driver assigned with a specific vehicle, was entrusted with the
transportation
of
respondent
companys
goods
and
property,
and
consequently with its handling and protection, hence, even if he did not
occupy a managerial position, he can be said to be holding a position of
responsibility. As to his actprincipal ground for his dismissal his attempt to
to
the
trust
and
[13]
confidence
reposed
on
smuggle out the scrap iron belonging to respondent company, the same is
undoubtedly work-related.
petitioner,
Gerardo
Luega,
actually
executed
450
opine that petitioner should have been afforded counsel or advised of the
right to counsel. The right to counsel and the assistance of one in
investigations involving termination cases is neither indispensable nor
mandatory, except when the employee himself requests for one or that he
manifests that he wants a formal hearing on the charges against him. In
petitioners case, there is no showing that he requested for a formal hearing
to be conducted or that he be assisted by counsel. Verily, since he was
furnished a second notice informing him of his dismissal and the grounds
therefor, the twin-notice requirement had been complied with to call for a
deletion of the appellate courts award of nominal damages to petitioner.
As for the subsequent dismissal of the criminal cases [18] filed
against petitioner, criminal and labor proceedings are distinct and separate
from each other. Each requires a different quantum of proof, arising though
they are from the same set of facts or circumstances. As Vergara v.
NLRC[19] holds:
An employees acquittal in a criminal case does not
automatically preclude a determination that he has been
guilty of acts inimical to the employers interest resulting in
loss of trust and confidence. Corollarily, the ground for the
dismissal of an employee does not require proof beyond
reasonable doubt; as noted earlier, the quantum of proof
required is merely substantial evidence. More importantly,
the trial court acquitted petitioner not because he did not
commit the offense, but merely because of the failure of
the prosecution to prove his guilt beyond reasonable
doubt.. In other words, while the evidence presented
against petitioner did not satisfy the quantum of
proof required for conviction in a criminal case, it
substantially proved his culpability which warranted
his dismissal from employment. (emphasis supplied)
451
in that the
SO ORDERED.
award
of
nominal
452
Present:
- versus -
DECISION
telephone
operator
who
would
undergo
probationary
and setting aside of the decision [1] dated May 25, 2004 of the Court of
Appeals (CA) in CA G.R. SP No. 78963, affirming the resolution dated
September 23, 2002 of the National Labor Relations Commission (NLRC) in
After the usual interview for the second telephone operator slot, PDI chose
to hire Magtibay on a probationary basis for a period of six (6) months. The
earlier decision dated July 29, 1996 of the Labor Arbiter in NLRC Case No.
011800-96, which dismissed the complaint for illegal dismissal filed by the
herein respondent Leon Magtibay, Jr. against the petitioner.
453
On March
13,
1996,
6-month
probationary period, PDI officer Benita del Rosario handed Magtibay his
termination paper, grounded on his alleged failure to meet company
standards. Aggrieved, Magtibay immediately filed a complaint for illegal
dismissal and damages before the Labor Arbiter. PDIEU later joined the fray
by filing a supplemental complaint for unfair labor practice.
After due proceedings, the Labor Arbiter found for PDI and accordingly
dismissed Magtibays complaint for illegal dismissal. The Labor Arbiter
premised
his
holding
on
the
validity
of
the
previous
contractual
been employed by and had worked for PDI for a total period of ten
months, i.e., four months more than the maximum six-month period
when his services were terminated inasmuch as the reckoning period for
standards of the company, hence, there was no basis for his dismissal.
Finally, he described his dismissal as tainted with bad faith and effected
PDI, for its part, denied all the factual allegations of Magtibay, adding that
Apart from the foregoing consideration, the Labor Arbiter further ruled that
expiration of the period stated therein. Pressing the point, PDI alleged that
reason. Albeit the basis for termination was couched in the abstract, i.e.,
you did not meet the standards of the company, there were three specific
company
Magtibay was dismissed for violation of company rules and policies, such
as allowing his lover to enter and linger inside the telephone operators
application form his having a dependent child; and (3) he exhibited lack of
booth and for failure to meet prescribed company standards which were
on March 10, 1996 without switching the proper lines to the company
rule
prohibiting
unauthorized
persons
from
entering
the
454
xxxxxxxxx
PDIEU and Magtibay appealed the decision of the Labor Arbiter to the
NLRC. As stated earlier, the NLRC reversed and set aside said decision,
effectively ruling that Magtibay was illegally dismissed. According to the
NLRC, Magtibays probationary employment had ripened into a regular one.
With the NLRCs denial of its motion for reconsideration, PDI went to the CA
on a petition for certiorari. Eventually, the CA denied due course to PDIs
petition on the strength of the following observations:
I.
II.
455
envisaged to give those who have less in life more in law. Article 279 of the
Labor Code which gives employees the security of tenure is one playing
field leveling measure:
But hand in hand with the restraining effect of Section 279, the
same Labor Code also gives the employer a period within which to
determine whether a particular employee is fit to work for him or not. This
[2]
Art.
281.
Probationary
employment. Probationary employment shall not exceed
six (6) months from the date the employee started
working, unless it is covered by an apprenticeship
agreement stipulating a longer period. The services of an
employee who has been engaged on a probationary basis
may be terminated for a just cause or when he fails to
qualify as a regular employee in accordance with
reasonable standards made known by the employer to the
employee at the time of his engagement. An employee
who is allowed to work after a probationary period shall be
considered a regular employee.
456
Within
the
limited
probationary employees
x x x. A probationary employee, as understood
under Article 282 (now Article 281) of the Labor Code, is
one who is on trial by an employer during which the
employer determines whether or not he is qualified for
permanent employment. A probationary appointment is
made to afford the employer an opportunity to observe the
fitness of a probationer while at work, and to ascertain
whether he will become a proper and efficient
employee. The word probationary, as used to describe the
period of employment, implies the purpose of the term or
period but not its length.
legal
six-month
probationary
period,
It is
We do not agree with the appellate court when it cleared the NLRC
of commission of grave abuse of discretion despite the latters disregard of
clear and convincing evidence that there were reasonable standards made
457
It does not.
Magtibay ought to have been made to understand during his briefing and
probationary employment which is for just cause, the second ground does
not require notice and hearing. Due process of law for this second ground
and regulations strains credulity for acceptance. The CAs observation that
during his probationary period known to him at the time of his probationary
the duties, rules and regulations that he has allegedly violated is a strained
employee knows from the very start that he will be under close
industry practice and ordinary human experience do not support the CAs
assessed where due process regarding the second ground lies, and not in
he
underwent
one-on-one
orientation
with
nor rebutted PDIsfurther claim that his direct superior, Benita del Rosario,
458
employee. Thus, the Court entertains no doubt that when PDI took him in
on September 21, 1995, Magtibay was already very much aware of the
level of competency and professionalism PDI wanted out of him for the
entire duration of his probationary employment.
probationary
period.
This
was
established
during
the
proceedings before the labor arbiter and borne out by the records and the
pleadings before the Court. When the NLRC disregarded the substantial
evidence establishing the legal termination of Magtibays probationary
employment and rendered judgment grossly and directly contradicting
such
clear
of
discretion
is
decision
dated July 29, 1996 of the Labor Arbiter in NLRC Case No. 011800-96,
dismissing respondent Leon Magtibay, Jr.s complaint for alleged illegal
dismissal, is REINSTATED.
No pronouncement as to costs.
SO ORDERED.
459
460
461
462
463
464
privileges and paid his full backwages inclusive of allowances and other
benefits computed from June 12, 1998 up to his actual reinstatement. The
dispositive portion of the decision reads, as follows:
465
refused to accept [the respondent] when he reported for work on June 26,
1998. This is consistent with the finding[s] of the DOLE Secretary when he
declared the strikers to have lost their employment status. x x x.
Unperturbed, PAL filed a petition for certiorari with the CA, questioning the
NLRC Resolution dated June 28, 2002. Subsequently, in a Decision 20 dated
January 31, 2005, the CA affirmed with modification the NLRC Resolution
dated June 28, 2002, the dispositive portion of which reads, as follows:
xxxx
WHEREFORE, premises considered, the appeal is hereby GRANTED, and the
decision dated March 5, 2001, is REVERSED and SET ASIDE for utter lack of
merit.
SO ORDERED.14
Notwithstanding the reversal of the LA decision, the respondent pursued
his move for the issuance of a writ of execution, claiming that he was
entitled to reinstatement salaries which he supposedly earned during the
pendency of the appeal to the NLRC. On August 28, 2001, the LA granted
the motion and issued the corresponding writ of execution. 15
On September 17, 2001, the LA issued an Order, 16 clarifying the
respondents entitlement to reinstatement salaries. He ratiocinated that
the order of reinstatement is immediately executory even pending appeal
and that under Article 223 of the Labor Code, the employer has the option
to admit the employee back towork or merely reinstate him in the payroll.
Considering, however, that there was no physical reinstatement, the
respondent, as a matter of right, must be reinstated in the payroll. The
accrued salaries may now be the subject of execution despite the NLRCs
reversal of the decision.
PAL appealed the LA Order dated September 17, 2001 to the NLRC, arguing
that the writ of execution lackedfactual and legal basis considering that the
NLRC reversed and set aside the LA decision and categorically declared the
order of reinstatement as totally devoid of merit. It contended that
entitlement to salaries pending appeal presupposes a finding that the
employee is entitled to reinstatement. Absent such finding, the employee
is not entitled to reinstatement salaries and the writ of execution issued
pursuant thereto is a complete nullity.17
On June 28, 2002, the NLRC rendered a Resolution,18 sustaining the award
of reinstatement salaries to the respondent albeit suspending its execution
in view of the fact that PAL was under rehabilitation receivership. PAL filed
a motion for reconsideration but the NLRC denied the same in its
Resolution19 dated November 22, 2002.
WHEREFORE, the NLRC Resolution dated June 28, 2002 is AFFIRMED with
the MODIFICATION that, in lieu of reinstatement salaries, petitioner
Philippine Airlines, Inc. is ordered to pay respondent Paz separation pay
equivalent to one month salary for every year of service, to be computed
from the time respondent commenced employment with petitioner PAL
until the time the Labor Arbiter issued the writ ordering respondents
reinstatement, i.e., on May 25, 2001.
SO ORDERED.21
The CA ruled that while the respondent is entitled to reinstatement, the
prevailing circumstances rendered the same difficult if not impossible to
execute. It noted that at the time the reinstatement was ordered, there
was no vacant B747-400 pilot position available for the respondent. Further
complicating the situation is the fact that PAL has been under receivership
since July 1998. Thus, in lieu of reinstatement salaries, the CA ordered PAL
to pay the respondent separation pay equivalent to one (1) month salary
for every year of service.22
PAL filed a motion for reconsideration of the CA decision. Subsequently, the
CA rendered the assailed Amended Decision 23 dated June 29, 2010, holding
thus:
Accordingly, compliance with the reinstatement order is not affected by the
fact that private respondents previous position had been filled-up. In
reinstatement pending appeal, payroll reinstatement is an alternative to
actual reinstatement. Hence, public respondent did not err when it upheld
the Labor Arbiter that private respondent is entitled to reinstatement
salaries during the period of appeal.
WHEREFORE, premises considered, the modification contained in Our
January 31, 2005 Decision is DELETED and SET ASIDE. The June 28, 2002
Resolution of the National Labor Relations Commission is hereby
REINSTATED in toto.
SO ORDERED.24
466
On August 3, 2010, PAL filed the instant petition with the Court, contending
that the CA acted in a manner contrary to law and jurisprudence when it
upheld the award of reinstatement salaries to the respondent. 25
The petition is meritorious.
The same issue had been raised and addressed by the Court in the case of
Garcia v. Philippine Airlines, Inc.26 In the said case, the Court deliberated on
the application of Paragraph 3, Article 223 of the Labor Code in light of the
apparent divergence in its interpretation, specifically on the contemplation
of the reinstatement aspectof the LA decision. The pertinent portion of the
provision reads, thus:
In any event, the decision of the Labor Arbiter reinstating a dismissed or
separated employee, insofar as the reinstatement aspectis concerned,
shall immediately be executory, pending appeal. The employee shall either
be admitted back to work under the same terms and conditions prevailing
prior to his dismissal or separation or, at the option of the employer,
merely reinstated inthe payroll. The posting of a bond by the employer
shall not stay the execution for reinstatement provided herein. 27 (Emphasis
and underscoring in the original)
Briefly, in Garcia, the petitioners were dismissed by their employer,
respondent PAL, after they were allegedly caught in the act of sniffing
shabu when a team of company security personnel and law enforcers
raided the PAL Technical Centers Toolroom Section. After they filed a
complaint for illegal dismissal, respondent PAL was placed under
rehabilitation receivership due to serious financial losses. Eventually, the
LA resolved the case in favor of the petitioners and ordered their
immediate reinstatement. Upon appeal, however, the NLRC reversed the
LA decision and dismissed the complaint. Even then, the LA issued a writ of
execution, with respect to the reinstatement aspect of the decision, and
issued a notice of garnishment. Respondent PAL filed an urgent petition for
injunction with the NLRC but the latter, by way of Resolutions dated
November 26, 2001 and January 28, 2002, affirmed the validity of the writ
and the notice issued by the LA but suspended and referred the action to
the rehabilitation receiver. On appeal, the CA ruled in favor of respondent
PAL and nullified the NLRC resolutions, holding that (1) a subsequent
finding of a valid dismissal removes the basis for the reinstatement aspect
of a LA decision, and (2) the impossibility to comply with the reinstatement
order due to corporate rehabilitation justifies respondent PALs failure to
exercise the options under Article 223 of the Labor Code. When the case
was further elevated to this Court, the petition was partially granted and
467
In light of the fact that PAL's failure to comply with the reinstatement order
was justified by the exigencies of corporation rehabilitation, the respondent
may no longer claim salaries which he should have received during the
period that the LA decision ordering his reinstatement is still pending
appeal until it was overturned by the NLRC. Thus, the CA committed a
reversible error in recognizing the respondent's right to collect
reinstatement salaries albeit suspending its execution while PAL is still
under corporate rehabilitation.
WHEREFORE, the petition is GRANTED. The Amended Decision dated June
29, 2010 of the Court of Appeals in CA-G.R. SP No. 75618 is hereby
REVERSED and SET ASIDE. Respondent Reynaldo V. Paz is not entitled to
the payment of reinstatement salaries.
SO ORDERED.
468
- versus -
SO ORDERED.[2]
PUNO, C.J.,
QUISUMBING,
YNARES-SANTIAGO,
CARPIO,
AUSTRIA-MARTINEZ,
CORONA,
CARPIO MORALES,
AZCUNA,
TINGA,
CHICO-NAZARIO,
VELASCO, JR.,
NACHURA,
LEONARDO-DE CASTRO, and
BRION, JJ.
The case stemmed from the administrative charge filed by PAL against its
employees-herein petitioners[3] after they were allegedly caught in the act
of sniffing shabu when a team of company security personnel and law
enforcers raided the PAL Technical Centers Toolroom Section on July 24,
1995.
Promulgated:
January 11, 1999,[5] resolved by the Labor Arbiter in their favor, thus
ordering PAL to, inter alia, immediately comply with the reinstatement
aspect of the decision.
DECISION
Prior to the promulgation of the Labor Arbiters decision, the Securities and
Exchange Commission
(SEC)
placed
PAL (hereafter
referred to
as
2003 Decision and April 16, 2004 Resolution of the Court of Appeals
[1]
in
respondent, Philippine Airlines, Inc. (PAL), and denied petitioners Motion for
Reconsideration, respectively. The dispositive portion of the assailed
From the Labor Arbiters decision, respondent appealed to the NLRC which,
Decision reads:
469
1999 Decision,
and
on October
25,
2000,
he
issued
Notice
of
Respondent elevated the matter to the appellate court which issued the
herein challenged Decision and Resolution nullifying the NLRC Resolutions
on two grounds, essentially espousing that: (1) a subsequent finding of a
valid dismissal removes the basis for implementing the reinstatement
aspect of a labor arbiters decision (the first ground), and (2) the
impossibility to comply with the reinstatement order due to corporate
rehabilitation provides a reasonable justification for the failure to exercise
to
resolve
the remaining
issue for
consideration, which
the options under Article 223 of the Labor Code (the second ground).
By Decision of August 29, 2007, this Court PARTIALLY GRANTED the present
petition
and
effectively
reinstated the
NLRC
Resolutions insofar
as
concerning
of
reinstatement
payroll
pending
reinstatement. On
appeal
the
one
or, particularly,
hand
is
the
470
It has thus been advanced that there is no point in releasing the wages to
petitioners since their dismissal was found to be valid, and to do so would
constitute unjust enrichment.
reinstatement,
order.
which
is
immediately
executory. Unless
there
is
471
xxxx
These duties and responsibilities of the State are imposed
not so much to express sympathy for the workingman as to
forcefully and meaningfully underscore labor as a primary
social and economic force, which the Constitution also
expressly affirms with equal intensity. Labor is an
indispensable partner for the nation's progress and stability.
Advisably, the sum is better left unspent. It becomes more logical and
practical for the employee to refuse payroll reinstatement and simply find
xxxx
x x x In short, with respect to decisions reinstating
employees, the law itself has determined a sufficiently
overwhelming reason for its execution pending appeal.
xxxx
x x x Then, by and pursuant to the same power (police
power), the State may authorize an immediate
implementation, pending appeal, of a decision reinstating a
dismissed or separated employee since that saving act is
designed to stop, although temporarily since the appeal
may be decided in favor of the appellant, a continuing
threat or danger to the survival or even the life of the
dismissed or separated employee and his family. [16]
to refuse payroll reinstatement. In the face of the grim possibilities, the rise
Further, the Genuino ruling not only disregards the social justice principles
behind the rule, but also institutes a scheme unduly favorable to
management. Under
such
scheme,
the
salaries
dispensed pendente
Even outside the theoretical trappings of the discussion and into the
mundane realities of human experience, the refund doctrine easily
demonstrates how a favorable decision by the Labor Arbiter could harm,
more than help, a dismissed employee. The employee, to make both ends
meet, would necessarily have to use up the salaries received during the
pendency of the appeal, only to end up having to refund the sum in case of
the
event
of
reversal
of
the
Labor
Arbiters
decision
ordering
reinstatement, the employer gets back the same amount without having to
spend ordinarily for bond premiums. This circumvents, if not directly
contradicts, the proscription that the posting of a bond [even a cash bond]
by the employer shall not stay the execution for reinstatement. [17]
472
this
argument
and
finds
the
prevailing
doctrine
in Air
Philippines and allied cases inapplicable because, unlike the present case,
the writ of execution therein was secured prior to the reversal of the Labor
The Court reaffirms the prevailing principle that even if the order of
Arbiters decision.
the part of the employer to reinstate and pay the wages of the dismissed
against time. The discussion stopped there without considering the cause
employee during the period of appeal until reversal by the higher court.
[21]
decision. In Pioneer
work under the same terms and conditions prevailing prior to their
Texturing
Corp.
v.
NLRC,[18] which
was
cited
473
execution during the pendency of the appeal, if the law is to serve its noble
NLRC[27] where it was alleged that the employer was willing to comply with
purpose. At the same time, any attempt on the part of the employer to
the order and that the employee opted not to pursue the execution of the
actually
order and ruled that the salary automatically accrued from notice of the
[25]
transpired
and Roquero,
[26]
issuance of a writ but was not acted upon by the Labor Arbiter. In that
scenario where the delay was caused by the Labor Arbiter, it was ruled that
the inaction of the Labor Arbiter who failed to act upon the employees
motion for the issuance of a writ of execution may no longer adversely
affect the cause of the dismissed employee in view of the self-executory
The test is two-fold: (1) there must be actual delay or the fact that the
The new NLRC Rules of Procedure, which took effect on January 7, 2006,
now require the employer to submit a report of compliance within 10
calendar days from receipt of the Labor Arbiters decision, [29] disobedience
to which clearly denotes a refusal to reinstate. The employee need not file
a motion for the issuance of the writ of execution since the Labor
Arbiter shall thereafter motu proprio issue the writ. With the new rules
in
place,
there
is
hardly
any
difficulty
in
determining
the
474
reinstate them, but whether such omission was justified depends on the
justification for the non-exercise of its options, on the one hand, and a
claim
of
actual
and
imminent
substantial
losses
as
ground
for
retrenchment, on the other hand, stops at the red line on the financial
It is settled that upon appointment by the SEC of a rehabilitation receiver,
all actions for claims before any court, tribunal or board against the
corporation shall ipso jure be suspended.[31] As stated early on, during the
more
pendency of petitioners complaint before the Labor Arbiter, the SEC placed
rendered his decision, the SEC replaced the Interim Rehabilitation Receiver
salient
distinctions. Unlike
the
ground
of
substantial
losses
under Article 223 of the Labor Code, not only by virtue of the statutory
control to give way to the full exercise of the powers of the rehabilitation
payroll reinstatement was thus justified. Such being the case, respondents
obligation to pay the salaries pending appeal, as the normal effect of the
this wise, the rehabilitation receiver may decide otherwise, not to mention
[32]
In sum, the obligation to pay the employees salaries upon the employers
failure to exercise the alternative options under Article 223 of the Labor
Code is not a hard and fast rule, considering the inherent constraints of
order to survive.
corporate rehabilitation.
475
SO ORDERED.
476
477
The appeal before us has reference to the decision of the National Labor
Relations Commission (NLRC) dated March 27, 1991 which modified the
decision of the Labor Arbiter involving petitioner's charge of illegal
dismissal. The reviewing authority merely awarded separation pay
equivalent to one-half month pay for every year of service and denied
petitioner's prayer for reinstatement, backwages, moral and exemplary
damages, including attorney's fees (p. 89, Rollo).
Petitioner started as clinical instructor of the College of Nursing of
Northwestern College (NWC) in June 1917 with a basic salary of P600.00 a
month. In October 1979, petitioner was appointed Dean of the College of
Nursing with a starting salary of P3,000.00 a month. In September 1981,
petitioner was promoted to College Administrator or Vice-President for
Administration, retaining concurrently her position of Dean of the College
of Nursing, with an increased salary of P3,500.00 per month. She was later
promoted to Executive Vice-President with the corresponding salary of
P7,500.00.
On April 10, 1988, petitioner's husband, Oscar Aurelio, a stockholder of
respondent NWC, was elected Auditor. On May 1, 1988, the individual
respondents, as Board of Directors, took over the management of
respondent NWC. This new management unleashed a series of
reorganization affecting the petitioner and her husband, Oscar Aurelio, to
wit:
(a) On May 30, 1988, petitioner's husband, then in the United States, was
removed as Auditor of the college;
(b) Without prior notice, petitioner's office was stripped of its facilities.
First, the airconditioner, then the refrigerator;
(c) Respondents asked petitioner, "to justify," the continued use of the
conference room which was used for team teaching; the librarian of the
College of Nursing was removed and assigned as secretary of the
Chairman of Academic Matters and all the facilities of the College of
Nursing were taken over by the individual respondents;
(d) Petitioner's salary was reduced from P7,500.00 to P5,000.00 then to
P2,500.00 a month;
478
Yours truly,
On April 30, 1988, the annual regular meeting of stockholders was held at
the principal office of the corporation in Laoag City. Elected Directors were
the following: Alva Caday, Lucidia Flores, Nicolas Nicolas, Oscar Aurelio,
Cherry Caday, Lilia Paz, Ben Nicolas, Joffrey Aurelio, Francisco Santella,
Glenn Aquino, and Wilfredo Nicolas. The following members were elected
as officers of the Northwestern College: Alva Caday, Chairman of the
Board; Ben Nicolas, Vice-Chairman and President; Joffrey Aurelio, Treasurer;
Oscar Aurelio, Corporate Auditor and Lucidia Flores, Corporate Secretary.
Nicolas Nicolas, Oscar Aurelio, and Cherry Caday later resigned and in their
stead, Atty. Ernesto Asuncion, Atty. Jose Castro, and Dr. Juanito Chan were
elected by the stockholders.
Since their election into office, the Board members have taken effective
control of the management of the college and have regularly exercised
their corporate powers. The new Board conducted a preliminary audit
which revealed that the college was financially distressed, unable to meet
its maturing obligations with its creditor bank. The new management
headed by its President, Ben Nicolas, embarked on a realignment of
positions and functions of the different department in order to minimize
expenditures.
As a result of the audit, NWC was compelled to abolish the administrative
positions held by petitioner, which she did not contest, because of the
following reasons:
479
a) In 1988, NWC realized that it was violating the Administrative Manual for
Private Schools. Thus, the position of Administrator/Vice President had to
be eliminated;
b) At that time, NWC was reeling from the effects of ,j its failure to meet its
obligations with its creditors and all efforts to minimize expenditures were
being undertaken;
c) NWC realized after a study of the realignment of the positions that the
functions and duties of Administrator/Vice President for Administration
were being performed by the President. Consequently, the former positions
had become redundant.
During the first semester of the school year 1988-1989, Northwestern
College uncovered irregularities allegedly committed by the petitioner, to
wit:
a) She personally exacted without receipt P25.00 from every student in the
College of Nursing for the maintenance of the College Library.
b) She did not remit nor liquidate the sum of P600.00 out of the P1,295.91
Related Learning Experience (RLE) fee paid by all students in the College of
Nursing. The total sum thereof in the amount of P114,280.00 suspiciously
remained unremitted and unliquidated for an unreasonable length of time.
c) She drew salaries for teaching in the College of Nursing although she did
not have a teaching load. Before the investigation could be concluded,
petitioner sent a letter to the President of the college on September 20,
1988 manifesting that she is on an indefinite leave of absence.
On December 29, 1989, the labor arbiter dismissed the complaint on the
basis of these findings which were adopted by the NLRC:
. . . Undoubtedly, complainant had occupied managerial positions, thus the
rule of loss of trust and confidence applies. This office is however aware
that allegations of loss of trust and confidence must have some basis and
such is not lacking on record.
Respondent had alleged and submitted evidence of irregularities of
complainant during her tenure at the college. The complainant instead of
refuting the charges cited alleged irregularities committed by the
respondents in their respective offices. Needless to state, the allegation
does not detract anything from the charges of irregularities against her by
the respondent school. As the records of this case stand, our complainant
has not sufficiently explained the substantiated charges of Northwestern
College anent exaction of P25.00 from every student of the College of
nursing, receipt of salaries for alleged teaching services for which she did
not have any teaching load and failure to remit nor liquidate a total
amount of P120,000.00. (p. 29 and 94, Rollo.)
It must be emphasized that the rules of dismissal for managerial
employees are different from those governing ordinary employees for it
would be unjust and inequitable to compel an employer to continue with
the employment of a person who occupies a managerial and sensitive
position despite loss of trust and confidence. At the very least, the
relationship must be considered seriously strained, foreclosing the remedy
of reinstatement. We find that the allegations of irregularities were
sufficiently substantiated thus justifying petitioner's separation.
Moreover, and still on the issue of dismissal, the records disclose that in
holding on to the two positions, petitioner violated the Administrative
Manual for Private Schools. Thus, the respondent had no other recourse but
to take away one of the positions from her or abolish the same.
Undoubtedly, the College Board of Directors has the authority to reorganize
and streamline the operations of the college with the end in view of
minimizing expenditures.
We believe that the instant case was an offshoot of a corporate
reorganization, a prerogative reposed on the Board of Directors of the
College.
The NLRC found that:
Admittedly, complainant was a managerial employee who has to have the
complete trust and confidence of respondents. While it may be true that
complainant was not strictly an accountable employee primarily
responsible for disbursement of whatever funds, respondents had some
basis in losing its trust and confidence in complainant. Respondents'
evidence showed that under the principle of command responsibility,
complainant was in a sense responsible in the monitoring of monetary
transactions involving funds from library collections and from Related
Learning Science collection (pp. 29-32, 136). For it has been held that in
case of termination due to loss of trust and confidence proof beyond
reasonable doubt of misconduct is not necessary but some basis being
sufficient (Villadolid vs. Inciong, 121 SCRA 205).
480
481
Private School which requires that all collegiate departments should have a
full-time head.
In Philippine School of Business Administration, et al. vs. Labor Arbiter
Lacandola S. Leano and Rufino R. Tan (127 SCRA 778 [1984]), this Court
held:
This is not a case of dismissal. The situation is that of a corporate office
having been declared vacant, and of TAN's not having been elected
thereafter, The matter of whom to elect is a prerogative that belongs to the
Board, and involves the exercise of deliberate choice and the faculty of
discriminative selection. Generally speaking, the relationship of a person to
a corporation, whether as officer or agent or employee, is not determined
by the nature of the services performed, but by the incidents of the
relationship as they actually exist. (At p. 783.).
The Board of Directors of NWC merely exercised rights vested in it by the
Articles of Incorporation. Petitioner failed to refute the evidence proffered
by NWC before the labor arbiter. In her appeal to the NLRC, petitioner also
failed to rebut the findings of the labor arbiter. In the instant petition, she
has again failed to overturn private respondents' evidence as well as the
findings of the labor arbiter which were affirmed by the NLRC.
Petitioner's application for an indefinite leave of absence was not approved
by the college authorities, but this notwithstanding, she failed to follow-up
her application and did not report for work. Believing she was dismissed,
petitioner filed the complaint for illegal dismissal, illegal deductions,
underpayment, unpaid wages or commissions and for moral damages and
attorney's fees on November 16, 1988.
As pointed out earlier, the rules on termination of employment, penalties
for infractions, and resort to concerted actions, insofar as managerial
employees are concerned, are not necessarily the same as those
applicable to termination of employment of ordinary employees.
Employers, generally, are allowed a wider latitude of discretion in
terminating the employment of managerial personnel or those of similar
rank performing functions which by their nature require the employer's
trust and confidence, than in the case of ordinary rank-and-file employees
(Cruz vs. Medina, 177 SCRA S65 [1989]).
Article 282(c) of the Labor Code provides that an employer may terminate
an employment for "fraud or willful breach by the employee of the trust
reposed in him by his employer or his duly authorized representative."
Under this provision, loss of trust and confidence is a valid ground for
dismissing an employee. Termination of employment on this ground does
not require proof beyond reasonable doubt. All that is needed is for the
employer to establish sufficient basis for the dismissal of the employee
(Cruz vs. Medina, supra)
Both the labor arbiter and the public respondent NLRC found that there is
some basis for respondent NWC's loss of trust and confidence on
petitioner.
The dismissal of the petitioner was for a just and valid cause. However,
public respondent gave credence to petitioner's allegation that she was not
accorded notice and hearing prior to termination. It appears on record that
the investigation of petitioner's alleged irregularities was conducted after
the filing of the complaint for illegal dismissal.
Under Section 1, Rule XIV of the Implementing Rules and Regulations of the
Labor Code, the dismissal of an employee must be for a just or authorized
cause and after due process.
The two requirements of this legal provision are:
1. The legality of the act of dismissal, that is, dismissal under the ground
provided under Article 283 of the New Labor Code; and
2. The legality in the manner of dismissal, that is, with due observance of
the procedural requirements of Sections 2, 5, and 6 of Batas Pambansa
Blg. 130 (Shoemart vs. NLRC, 176 SCRA 385 [1989]).
While the Labor Code treats of the nature and the remedies available with
regard to the first, such as: (a) reinstatement to his former position without
loss of seniority rights, and (b) payment of backwages corresponding to the
period from his illegal dismissal up to actual reinstatement, said Code does
not deal at all with the second, that is, the manner of dismissal, which is
therefore, governed exclusively by the Civil Code (Primero vs. IAC, 156
SCRA 436 [1987]; Shoemart vs. NLRC, supra).
482
In cases where there was a valid ground to dismiss an employee but there
was non-observance of due process, this Court held that only a sanction
must be imposed upon the employer for failure to give formal notice and to
conduct an investigation required by law before dismissing the employee
in consonance with the ruling in Wenphil v. NLRC, 170 SCRA 69 (1989);
Shoemart, Inc. vs. NLRC, supra; and in Pacific Mills, Inc. vs. Zenaida Alonzo,
199 SCRA 617 (1991).
In Wenphil, we held:
However, the petitioner must nevertheless be held to account for failure to
extend to private respondent his right to an investigation before causing
his dismissal. The rule is explicit as discussed above. The dismissal of an
employee must be for just or authorized cause and after due process
(Emphasis in the original). Petitioner committed an infraction of the second
requirement. Thus, it must be imposed a sanction for its failure to give a
formal notice and conduct an investigation as required by law before
dismissing petitioner from employment. Considering the circumstance of
this case petitioner must indemnify the private respondent the amount of
P1,000.00. The measure of this award depends on the facts of each case
and the gravity of the omission committed by the employer. (at p. 76,
reiterated in Pacific Mills, supra, at p. 261.)
Public respondent's finding that petitioner was not afforded due process is
correct but the Commission erred when it awarded separation pay in the
amount of P32,750.00. In the Pacific Mills, Inc. and Wenphil cases, this
Court merely awarded P1,000.00 as penalty for non-observance of due
process.
The Board of Directors, composed of the individual private respondents
herein, has the power granted by the Corporation Code to implement a
reorganization of respondent college's offices, including the abolition of
various positions, since it is implied or incidental to its power to conduct
the regular business affairs of the corporation.
The prerogative of management to conduct its own business affairs to
achieve its purposes cannot be denied (San Miguel Brewery Sales Force
Union [FTGHWO] vs. Ople, 110 SCRA 25 [1981]; Abbot Laboratories vs.
NLRC, 154 SCRA 713 [1987]). Management is at liberty, absent any malice
on its part, to abolish positions which it deems no longer necessary (Great
Pacific Life Assurance Corp. vs. NLRC, 188 SCRA 139 [1990]).
483
REYNALDO G. CABIGTING,
G.R. No. 167706
Petitioner,
Before this Court is a Petition for Review on certiorari[1] under Rule 45 of the Rul
assailing the August 31, 2004 Decision[2] and April 5, 2005 Resolution[3] of the
Appeals (CA) in CA-G.R. SP No. 82810. The CA declared the dismissal of petitione
and ordered the payment of his full backwages, but did not decree his reinstateme
Present:
The facts of the case:
- versus -
QUISUMBING,* J.,
CARPIO, J., Chairperson,
CHICO-NAZARIO,
PERALTA, and
SAN MIGUEL FOODS, INC.,
ABAD,** JJ.
Respondent.
On June 26, 2000, respondent San Miguel Foods, Inc., through its President,
Mr. Arnaldo Africa, sent petitioner a letter informing him that his position as
sales office coordinator under its logistic department has been declared
Promulgated:
November 5, 2009
redundant.
Simultaneously,
respondent
terminated
the
services
of
petitioner effective July 31, 2000, and offered him an early retirement
package. Thereafter, petitioner was included in the list of retrenched
x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
DECISION
Petitioner was surprised upon receipt of the letter because he was
not a sales office coordinator, and yet he was being terminated as such.
PERALTA, J.:
484
On October 14, 2002, the Labor Arbiter (LA) rendered a Decision, [12] where
With the support of his union,[8] petitioner filed a Complaint questioning his
reads:
[9]
SO ORDERED.[13]
as to his non-reinstatement to his previous post and for not awarding him
On June 30, 2003, the NLRC rendered a Decision [15] affirming the LAs
finding that petitioner was illegally dismissed by respondent. More
importantly, the NLRC modified the LAs Decision by ordering the
reinstatement of petitioner to his previous post, without loss of seniority
rights. The dispositive portion of said Decision reads:
485
SO ORDERED.[18]
SO ORDERED.[16]
Respondent filed a Motion for Reconsideration [19] of the said Decision.
Likewise, petitioner filed a Partial Motion for Reconsideration [20] assailing
Respondent
appealed
the
NLRC
Decision
to
the
CA via a
Petition
Hence, herein petition, with petitioner raising the lone assignment of error,
to wit:
486
petitioners reinstatement.
At the outset, this Court shall address respondents plea to re-open
the issue of illegal dismissal. Respondent argues that it is axiomatic that an
appeal, once accepted by the Supreme Court, throws the entire case open
to review.[23] Accordingly, respondent posits that petitioner was not illegally
dismissed, but was separated due to a valid redundancy/retrenchment
program.
[24]
It bears to stress that the LA, the NLRC and the CA all ruled that petitioner
was illegally dismissed. Such being the case, factual findings of quasijudicial bodies like the NLRC, particularly when they coincide with those of
the Labor Arbiter and, if supported by substantial evidence, are accorded
respect and even finality by this Court.[26] Moreover, it is not the function of
this Court to assess and evaluate the evidence all over again, particularly
where the findings of the LA, the NLRC and the CA coincide. Thus, absent a
showing of an error of law committed by the court below, or of whimsical or
conclusions, this Court may not disturb its factual findings. [27]
rule, however, is not ironclad and admits certain exceptions, such as when
(1) the conclusion is grounded on speculations, surmises or conjectures; (2)
the inference is manifestly mistaken, absurd or impossible; (3) there is
grave abuse of discretion; (4) the judgment is based on a misapprehension
Having settled the foregoing, this Court shall now address the lone issue of
strained relations.
of facts; (5) the findings of fact are conflicting; (6) there is no citation of
specific evidence on which the factual findings are based;
(7) the
Article 279 of the Labor Code of the Philippines provides the law on
reinstatement, viz.:
487
488
proper subject of herein petition, this Court shall address said issue in light
of the conflicting findings of the LA and the NLRC.
The
LA
ruled
that
strained
relations
barred
petitioners
reinstatement, to wit:
Moreover, Chief Justice Reynato S. Puno, in his dissenting opinion
in MGG Marine Services, Inc. v. National Labor Relations Commission,
[33]
strained relations:
After a perusal of the LA Decision, this Court finds that the LA had
no hard facts upon which to base the application of the doctrine of strained
relations, as the same was not squarely discussed nor elaborated on. Also,
it is of notice that said issue was addressed by the LA in just one sentence
without indicating factual circumstances why strained relations exist.
The same is also true for the CA Decision which disposed of the
issue in just one sentence without any elaboration, to wit:
489
Accordingly, this Court is of the opinion that both the LA and the CA based
their conclusions on impression alone. It bears to stress that reinstatement
is the rule and, for the exception of strained relations to apply, it should be
proved that it is likely that if reinstated, an atmosphere of antipathy and
antagonism would be generated as to adversely affect the efficiency and
productivity of the employee concerned. However, both the LA and the CA
failed to state the basis for their finding that a strained relationship exists.
Based on the foregoing, this Court upholds the ruling of the NLRC
finding the doctrine of strained relations inapplicable to the factual
circumstances of the case at bar, to wit:
490
xxxx
On
the
argument
that
Cabigting
was
merely
accommodated by the respondent after the closure of the
Tacoma Warehouse, it, however, appears that no such
accommodation existed. x x x[42]
view that the words allegedly imputing malice and bad faith towards the
respondent cannot be made a basis for denying his reinstatement.
Respondents perceived antipathy and antagonism is not of such degree as
would preclude reinstatement of petitioner to his former position. [39] In
addition, by themselves alone, the words used by petitioner in his
pleadings are insufficient to prove the presence of strained relations. Thus,
Lastly, this Court takes note of the findings of fact of the NLRC that the
position of inventory controller and warehouseman is still existing up to
date.[44] Petitioner has been an inventory controller for so many years, and
there should be no problem in ordering the reinstatement with facility of a
laborer, clerk, or other rank-and-file employee.[45]
this Court finds that one should not fault petitioner for his choice of words,
especially in light of overwhelming evidence showing he was illegally
In conclusion, it bears to stress that it is human nature that some
dismissed.
SP
No.
82810
are
491
Respondent
is ORDERED toIMMEDIATELY
492
Promulgated:
February 1, 2012
of the clients but were not entered in the banks book of accounts. Further
audit showed that there were various deposits which were entered in the
x------------------------------------------------------------------------------------x
DECISION
On November 17, 2004, the respondent, through a memorandum
REYES, J.:
Court
filed
the Decision
[1]
by
the
Bank
of
Lubao,
Inc.
(petitioner)
[2]
assailing
for qualified theft against Lingad and the respondent with the Municipal
Trial
Court
(MTC)
of
Lubao,
Pampanga.
Thereafter,
citing
serious
493
illegal dismissal with the Regional Arbitration Branch of the National Labor
submitting a new audit report dated April 30, 2007. Pending appeal, the
petitioner sent the respondent a letter [5] dated April 30, 2007 requiring him
complaint, the respondent, to bolster his claim that there was no valid
ground for his dismissal, averred that the charge against him for qualified
the LA. The said letter was served to the respondent on May 3, 2007 but he
conspired with Lingad. The respondent sought an award for separation pay,
full backwages, 13th month pay for 2004 and moral and exemplary
damages.
On July 21, 2008, the NLRC rendered a Decision [6] affirming the
For its part, the petitioner insists that the dismissal of the
February 28, 2007 Decision of the LA. The NLRC held that it was sufficiently
respondent is justified, asserting the February 14, 2006 Audit Report which
established that only Lingad was the one responsible for the said
confirmed
alleged
misappropriations. Further, the NLRC asserted that the February 14, 2006
and April 30, 2007 audit reports presented by the petitioner could not be
given evidentiary weight as the same were executed after the respondent
the
participation
of
the
respondent
in
the
said July 21, 2008 Decision but it was denied by the NLRC in its
The Labor Arbiters Decision
CA alleging that the NLRC and the LA gravely abused their discretion in
494
April
decision[9] denying
24,
the
2009,
the
petition
CA
rendered
the
by
herein
the
assailed
petitioner.
The CA agreed with the LA and the NLRC that the petitioner failed
to establish by substantial evidence that there was indeed a valid ground
for the respondents dismissal. Nevertheless, the CA held that the petitioner
should pay the respondent separation pay since the latter did not pray for
reinstatement before the LA and that the same would be in the best
interest of the parties considering the animosity and antagonism that exist
between them. The CA stated the following:
With respect to monetary awards, a finding that an
employee has been illegally dismissed ordinarily entitles
him to reinstatement to his former position without loss of
seniority rights and to the payment of backwages. In this
case, however, private respondent did not pray for
reinstatement before the Labor Arbiter. This being the
case, the employer should pay him separation pay in lieu
[of] reinstatement. This is only just and practical because
reinstatement of private respondent will no longer be in the
best interest of both parties considering the animosity and
antagonism that exist between them brought about by the
filing of charges in the criminal as well as in the labor
proceedings. Consequently, private respondent is entitled
to separation pay equivalent to one month pay for every
year of service up to the finality of this judgment, as an
alternative to reinstatement. With respect to his
backwages, where reinstatement is no longer possible, it
shall be computed from the time of the employees illegal
In his Comment,[14] the respondent asserted that the CA did not err
in ordering the payment of separation pay in his favor in lieu of
reinstatement since there is already a strained relationship between him
495
and the petitioner. He intimated that the petitioner had previously filed
various criminal charges against him for qualified theft thus effectively
This rule, however, is not ironclad and admits certain exceptions, such as
impracticable.
Issues
Here, in view of the conflicting findings of the NLRC and the CA,
this Court is constrained to pass upon the propriety of the application of
the following: (1) whether the CA erred in ordering the petitioner to pay the
respondent separation pay in lieu of reinstatement; and (2) whether the
respondent is entitled to payment of backwages.
This Court notes that the LA, the NLRC and the CA unanimously
ruled that the respondent was illegally dismissed. Factual findings of quasijudicial bodies like the NLRC, if supported by substantial evidence, are
accorded respect and even finality by this Court, more so when they
coincide with those of the LA. Such factual findings are given more weight
when the same are affirmed by the CA. We find no reason to depart from
the foregoing rule.
between the parties, or where the relationship between the employer and
the employee has been unduly strained by reason of their irreconcilable
[15]
496
environment. On the other hand, it releases the employer from the grossly
itself indicative of the existence of strained relations between him and the
longer trust.[18]
Commission,[20] the Court held that the refusal of the dismissed employee
to be re-admitted is constitutive of strained relations:
Here, we agree with the CA that the relations between the parties
had been already strained thereby justifying the grant of separation pay in
lieu of reinstatement in favor of the respondent.
Time and again, this Court has recognized that strained relations
between the employer and employee is an exception to the rule requiring
actual reinstatement for illegally dismissed employees for the practical
reason that the already existing antagonism will only fester and
deteriorate, and will only worsen with possible adverse effects on the
various criminal complaints against the respondent for qualified theft and
substitute that protects the interests of both parties while ensuring that the
the subsequent filing by the latter of the complaint for illegal dismissal
law is respected.[22]
against the latter, taken together with the pendency of the instant case for
more than six years, had caused strained relations between the parties.
Anent the second issue, the petitioner claimed that the respondent
bad faith on its part when it terminated the latters employment. The
497
on May 4, 2007. Notwithstanding the said letter, the respondent opted not
to report for work. Thus, it is but fair that the backwages that should be
awarded to the respondent be computed from the time that the
We do not agree.
respondent was illegally dismissed until the time when he was required to
report for work, i.e. from September 1, 2005 until May 4, 2007. It is only
during the said period that the respondent is deemed to be entitled to the
payment of backwages.
The fact that the CA, in its April 4, 2009 decision, ordered the
Rule 45 as this Court is not a trier of facts. The petitioner failed to assert
any circumstance which would impel this Court to disregard the findings of
not entitle the latter to backwages. It bears stressing that decisions of the
CA, unlike that of the LA, are not immediately executory. Accordingly, the
However,
the
backwages
that
should
be
awarded
to
the
2007, the date when the petitioner required the former to report to work.
monetary
equivalent,
computed
from
the
time
their
actual
2009 and Resolution dated July 7, 2009 of the Court of Appeals in CA-G.R.
May 4, 2007. For this purpose, the case is hereby REMANDED to the Labor
[23]
SO ORDERED.
498
SYLLABUS
LABOR AND SOCIAL LEGISLATION; RECOVERY OF WAGES; COMPUTATION OF
BACKWAGES; BACKWAGES TO BE AWARDED TO AN ILLEGALLY
DISMISSED EMPLOYEE, SHOULD NOT, AS A GENERAL RULE, BE
DIMINISHED OR REDUCED BY THE EARNINGS DERIVED BY HIM
ELSEWHERE DURING THE PERIOD OF HIS ILLEGAL DISMISSAL;
RATIONALE THEREFOR. -- The Court deems it appropriate, to
reconsider such earlier ruling on the computation of backwages as
enunciated in said Pines City Educational Center case, by now holding
that comformably with the evident legislative intent as expressed in
Rep. Act No. 6715, above-quoted, backwages to be awarded to an
illegally dismissed employee, should not, as a general rule, be
diminished or reduced by the earnings derived by him elsewhere
during the period of his illegal dismissal. the underlying reason for this
ruling is that the employee, while litigating the legality (illegality) of
his dismissal, must still earn a living to support himself and family,
while full backwages have to be paid by the employer as part of the
price or penalty he has to pay for illegally dismissing his employee.
The clear legislative intent of the amendment in Rep. Act No. 6715 is
to give more benefits to workers than was previously given them
under the Mercury Drug rule or the "deduction of earnings elsewhere"
rule. Thus, a closer adherence to the legislative policy behind Rep. Act
No. 6715 points to "full backwages" as meaning exactly that, i.e.,
without deducting from backwages the earnings derived elsewhere by
the concerned employee during the period of his illegal dismissal. In
other words, the provision calling for "full backwages" to illegally
dismissed employees is clear, plain and free from ambiguity and,
therefore, must be applied without attempted or strained
interpretation. Index animi sermo est.
[G.R. No. 111651. November 28, 1996]
OSMALIK S. BUSTAMANTE, PAULINO A. BANTAYAN, FERNANDO L.
BUSTAMANTE, MARIO D. SUMONOD, and SABU J.
LAMARAN, petitioners, vs.NATIONAL LABOR RELATIONS
COMMISSION, FIFTH DIVISION and EVERGREEN FARMS,
INC., respondents.
RESOLUTION
PADILLA, J.:
499
500
501
502
503
Both Lim and HMR filed their respective petitions for certiorari before the
CA, docketed as CA-G.R. SP No. 80379 and CA-G.R. SP No. 80630,
respectively, which were consolidated. Pending resolution of the petitions,
the CA issued the Temporary Restraining Order (TRO) enjoining the
execution of the NLRC decision.
On November 15, 2005, the CA affirmed the NLRC decision with
modification as follows:
DECISION
MENDOZA, J.:
Before the Court is a petition for review on certiorari under Rule 45 of the
Rules of Court assailing the March 30, 2012 1 Decision of the Court of
Appeals (CA), in CA G.R. SP No. 112708, a case involving the computation
of the backwages of an illegally dismissed employee.
The Facts
On February 8, 2001, petitioner Conrado A. Lim (Lim) filed a case for illegal
dismissal and money claims against respondents, HMR Philippines,
Inc. (HMR) and its officers, Teresa G. Santos-Castro, Henry G. Bunag and
Nelson S. Camiller. The Labor Arbiter (LA) dismissed the complaint for lack
of merit. On April 11, 2003, the National Labor Relations
Commission (NLRC) in NLRC NCR No. 02-00926-01, reversed the LA and
declared Lim to have been illegally dismissed. The dispositive portion of
the NLRC decision reads:
WHEREFORE, premises considered, judgment is hereby rendered declaring
the appealed Decision REVERSED and SET ASIDE; that the dismissal of
herein complainant-appellant was illegal and the respondent-appellee
Company is hereby ordered to reinstate immediately the said employee to
his former position without loss of seniority rights and other privileges.
Furthermore, the respondent-appellee Company is hereby ordered to pay
the complainant-appellant his full backwages, reckoned from his
dismissal on February 3, 2001 up to the promulgation of this
Decision.
All other claims are hereby DISMISSED for lack of merit.
The Computation and Research Unit (CRU) of this Commission is hereby
directed tocompute the backwages and the 10% annual increase
from 1998 to 2000.
SO ORDERED.2]
[Emphases supplied]
504
In its assailed March 30, 2012 Decision,14 the CA dismissed the petition. It
emphasized that the April 11, 2003 NLRC decision had long become final
and executory after it was affirmed by the Court and, as such, it may no
longer be amended or corrected. While noting that the body of the NLRC
decision stated that petitioner was entitled to backwages until his actual
reinstatement, the CA ruled that when there was a conflict between the
dispositive portion and the body of the decision, the former must prevail as
the dispositive portion was the final order, and that it was the dispositive
portion which was the subject of execution. It wrote that the fallo was clear
and unequivocal and could, therefore, be given effect without going to the
body of the decision or further interpretation or construction.
The CA found that although the NLRC had recognized that petitioner was
entitled to backwages until actual reinstatement, nonetheless, it expressly
limited the computation of backwages to the promulgation date of its
decision. It wrote that the issue of whether such limitation was lawful or
improper could no longer be ventilated due to the finality of the judgment.
Hence, the present petition.
A. Backwages:
2/3/01 to 4/11/03 = 26.26
P13,750.00 x 26.26
13th month pay (P366,575.00/12)
Vacation Leave (P687.50 x 15 x
26.26/12)
B. Moral Damages
C. Exemplary Damages
D. Attorneys Fees
P361,075.00
30,089.58
22,859.37
I
P414,023.95
50,000.00
20,000.00
P484,023.95
48,402.39
P532,426.34
505
In their Comment,17 the respondents argue that the August 28, 2009 NLRC
Resolution had already become final and executory and could no longer be
modified as the petitioner belatedly filed his motion for reconsideration. In
the same vein, they argue that the April 21, 2009 LA Order had also
become final and executory considering that the petitioners motion ad
cautelam/appeal was not seasonably filed.
The respondents insist that the decretal portion of the NLRC decision,
dated April 11, 2003 limited the amount of petitioners backwages from
February 3, 2001 and up to promulgation of such Decision on April 11,
2003 only.18 Granting that the body of such decision controls, they aver
that the recoverable backwages cannot go beyond December 26, 2007,
the date HMR offered to reinstate Lim, who refused to be reinstated and
abandoned his job. They add that it was also clear from the dispositive
portion that the 10% annual salary increase awarded was only for the
years 1998 to 2000.
They also point out that the P12,500.00 base pay of Lim was already
inclusive of holiday pay, and that the conversion of sick leave to cash was
subject to management discretion in accordance with company policy.
Preliminarily, the Court shall first dispose of the lone procedural issue. The
respondents argue that the August 28, 2009 NLRC Resolution was already
final and executory and could no longer be modified as the petitioner
belatedly filed his motion for reconsideration thereto. In the same vein,
they aver that the April 21, 2009 LA Order was also final and executory
considering that petitioners motion ad cautelam/appeal was not
seasonably filed. The petitioner counters that his pleadings were timely
filed because the aforementioned NLRC Resolution and LA Order were not
duly received by an authorized representative.
They further argue that the claims for legal interest and additional moral
and exemplary damages are without merit because these were not
awarded in the decision and they simply acted in good faith in pursuing the
legal remedies available to them.
Petitioners Reply
In his Reply,19 Lim counters that his pleadings before the NLRC and the LA
were timely filed as the notices of their respective orders had not been
It appears that the respondents raised this issue before the NLRC and the
CA. The lower courts, nonetheless, ruled on the merits of the assailed
pleadings of the petitioner. The lower courts, thus, gave credence to the
506
507
508
509
replied to the petitioners letter. It did not make any further attempt to
reinstate the petitioner either. The recoverable backwages, thus, continue
to run, and must be reckoned up until the petitioners actual
reinstatement.
1999
2000
Total
13,750.00
15,125.00
10%
10%
1,375.00
1,512.50
16,500.00
18,150.00
49,650.00
Second, based on the above, the applicable base rate for the computation
of the petitioners backwages from the time he was illegally dismissed on
February 3, 2001 should be P15,125.00.
Lim cannot, however, insist that the 10% annual salary increase be applied
to his backwages past the year 2000 up to his actual reinstatement.
In Equitable Banking Corporation v. Sadac, 41 the Court held that although
Article 279 of the Labor Code mandates that an employees full backwages
be inclusive of allowances and other benefits, salary increases cannot be
interpreted as either an allowance or a benefit, as allowances and benefits
are separate from salary, while a salary increase is added to salary as an
increment thereto.42 It was further held therein that the base figure to be
used in the computation of backwages was pegged at the wage rate at the
time of the employees dismissal, inclusive of regular allowances that the
employee had been receiving such as the emergency living allowances and
the 13th month pay mandated by law. The award of salary differentials was
not allowed, the rule being that upon reinstatement, illegally dismissed
employees were to be paid their backwages without deduction and
qualification as to any wage increases or other benefits that might have
been received by their co-workers who were not dismissed. 43
Lim is, thus, entitled to be paid his unpaid 10% annual salary increase for
the years 1998-2000.
It must be noted that the NLRC did not err in awarding the unpaid salary
increase for the years 1998-2000 as such did not constitute backwages as
a consequence of the petitioners illegal dismissal, but was earned and
owing to the petitioner before he was illegally terminated.
A reading of the assailed order of the LA would reveal that it made the
following adjustment in connection to the 10% annual salary increase:
Holiday pay
The respondents insist that the base pay of Lim is already inclusive of
holiday pay. The records, however, are insufficient to determine whether
holiday pay is indeed included in the petitioners base pay.
This is incorrect on two counts. First, the LA failed to include the actual
unpaid 10% annual increase from 1998-2000. The first computation of the
LA,39 as well as the suggested computation of respondent HMR
itself,40 gave the correct computation of the unpaid salary increase from
1998-2000, as follows:cralawlawlibrary
Under Article 94 of the Labor Code, every worker shall be paid his regular
daily wage during regular holidays. Thus, an employee must receive his
daily wage even if he does not work on a regular holiday. The purpose of
holiday pay is to prevent diminution of the monthly income of workers on
account of work interruptions declared by the State.44
Year
Rate (P)
Increase
1998
12,500.00
10%
Monthly
Increase
(P)
1,250.00
Annual
Increase (P)
15,000.00
510
holidays.45 Hence, if the petitioners base pay does not yet include holiday
pay, it must be added to his monetary award.
This matter is clearly for the LA to determine being the labor official
charged with the implementation of decision 46 and concomitant
computations.
Sick leave pay
The LA found that that the petitioner was not entitled to have his sick
leaves converted to cash because such was subject to the discretion of
management in accordance with company policy.
The pertinent provision on sick leave conversion in the Personnel Policy
handbook of HMR reads:
d) Accumulated days of unused sick leave may be converted into cash,
time-off or vacation allowance at the end of the calendar year, any of these
upon the discretion of the General Manager.47
It is clear from the above that the provision does not give HMR the
absolute discretion to decide whether or not to grant sick leave conversion.
The discretion of the general manager only pertains to what form the sick
leave conversion may take, and not to whether or not sick leave
conversion will be granted at all. An HMR employee is, therefore, entitled
to conversion of unused sick leave, subject only to the general managers
discretion as to the form it will take, namely cash, time-off, or vacation
allowance. Considering that the conversion options of time-off and
vacation allowance are no longer feasible because the petitioner was
illegally dismissed, he is now entitled to have his unused sick leaves
converted to cash.
Additional moral and exemplary damages
Petitioner Lim prays that the respondents be made to pay, jointly and
severally, additional moral and exemplary damages on account of their
bad faith in delaying the payment and his reinstatement.
There appears, however, no basis to award additional damages considering
that the respondents simply availed of the remedies available to them
under the law in good faith.
Legal interest
The petitioner argues that legal interest in accordance with the case
of Eastern Shipping must also be awarded, as follows:
1.
the unpaid 10% annual increase from 1998 to 2000 shall earn a 6%
interest annually starting 1998 until October 23, 2003 (Entry of
Judgment of the April 11, 2003 NLRC decision); and 12% legal
interest per annum thereafter until the same is fully paid;
andChanRoblesVirtualawlibrary
2.
the backwages, 13th month pay as well as unpaid vacation and sick
leaves shall earn a 6% per annum interest starting at the time of
petitioners illegal dismissal on February 3, 2001 until October 23,
2003; and 12% legal interest per annumthereafter until the same is
fully paid.48
511
(2) the unpaid 10% annual salary increase from 1998-2000 in the amount
of P49,650.00;
(3) 13th month pay;
(4) vacation pay in accordance with the personnel policy handbook;
(5) the cash value of his unused sick leaves;
(6) holiday pay, provided that the Labor Arbiter finds that such is not yet
included in the base pay;
(7) moral damages in the amount of P50,000.00;
(8) exemplary damages in the amount of P20,000.00;
(9) attorneys fees equivalent to 10% of the total amount due to the
petitioner; and
(10) legal interest of 12% per annum of the total monetary awards
computed from July 27, 2007 to June 30, 2013, and 6% per
annum from July 1, 2013 until their full satisfaction.
The Labor Arbiter is ORDERED to compute the total monetary benefits
awarded and due the petitioner in accordance with this decision.
SO ORDERED.