[LABOR LAW CASE DIGEST] ATTY.
CARLISLE FABIE
WOMAN NIGHT WORKERS
[RA NO. 10151]
STAR PAPER CORPORATION V. SIMBOL
FACTS:
Petitioner Star Paper Corporation (the company) is a
corporation engaged in trading — principally of paper
products. Josephine Ongsitco is its Manager of the
Personnel and Administration Department while
Sebastian Chua is its Managing Director.
The petitioners show that respondents Ronaldo D.
Simbol (Simbol), Wilfreda N. Comia (Comia) and Lorna
E. Estrella (Estrella) were all regular employees of the
company.
Simbol and Alma Dayrit both employees got married.
Prior to the marriage, Ongsitco advised the couple that
one of them should resign pursuant to a company
policy. Simbol resigned.
Comia also got married with Howard who was also an
employee. They were also advised to resign. Comia
resigned.
Estrella met Luisito Zuniñaga who were both employees.
Zuñiga, a married man, got Estrella pregnant. The
company allegedly could have terminated her services
due to immorality but she opted to resign.
The respondents each signed a Release and
Conrmation Agreement. They stated therein that they
have no money and property accountabilities in the
company and that they release the latter of any claim or
demand of whatever nature.
Respondents offer a different version of their dismissal.
Simbol and Comia allege that they did not resign
voluntarily; they were compelled to resign in view of
an illegal company policy. As to respondent Estrella,
she alleges that she had a relationship with coworker
Zuñiga who misrepresented himself as a married but
separated man.
She met an accident and was advised by the doctor to
recuperate for twenty-one (21) days. She returned for
work but she found out that her name was on-hold at the
gate.
She was asked to sign a memorandum stating that
she was dismissed for immoral conduct. She
refused to sign. She was asked to write and
explanation but was nonetheless dismissed by the
company. Due to her urgent need for money, she later
submitted a letter of resignation in exchange for her
13 month pay.
Respondents later led a complaint for unfair labor
practice, constructive dismissal, separation pay and
attorney's fees. They averred that the aforementioned
company policy is illegal and contravenes Article 136 of
the Labor Code. They also contended that they were
dismissed due to their union membership.
LA dismissed the complaint.
On appeal to the NLRC, the Commission affirmed the
decision of the Labor Arbiter on January 11, 2002.
Respondents led a Motion for Reconsideration but was
denied by the NLRC in a Resolution.
They appealed to respondent court via Petition for
Certiorari.
CA reversed the NLRC decision.
Herein petitioner appealed in this court.
ISSUE:
WHETHER OR NOT THE QUESTIONED COMPANY
POLICY VIOLATED THE RIGHT OF THE EMPLOYEES
UNDER THE CONSITUTION AND LABOR CODE
HELD:
YES.
The 1987 Constitution states our policy towards the
protection of labor under the following provisions,
Article II, Section 18. The State affirms labor as a
primary social economic force. It shall protect the rights
of workers and promote their welfare.
Article XIII, Sec. 3. The State shall afford full protection
to labor, local and overseas, organized and unorganized,
and promote full employment and equality of
employment opportunities for all.
It shall guarantee the rights of all workers to self-
organization, collective bargaining and negotiations, and
peaceful concerted activities, including the right to strike
in accordance with law. They shall be entitled to security
of tenure, humane conditions of work, and a living wage.
 [LABOR LAW CASE DIGEST] ATTY. CARLISLE FABIE
They shall also participate in policy and decision-making
processes affecting their rights and benets as may be
provided by law.
The State shall promote the principle of shared
responsibility between workers and employers,
recognizing the right of labor to its just share in the fruits
of production and the right of enterprises to reasonable
returns on investments, and to expansion and growth.
The Civil Code likewise protects labor with the
following provisions:
Art. 1700. The relation between capital and labor are not
merely contractual. They are so impressed with public
interest that labor contracts must yield to the common
good. Therefore, such contracts are subject to the
special laws on labor unions, collective bargaining,
strikes and lockouts, closed shop, wages, working
conditions, hours of labor and similar subjects.
Art. 1702. In case of doubt, all labor legislation and all
labor contracts shall be construed in favor of the safety
and decent living for the labourer
The Labor Code is the most comprehensive piece of
legislation protecting labor.
The case at bar involves Article 136 of the Labor
Code which provides:
Art. 136. It shall be unlawful for an employer to require
as a condition of employment or continuation of
employment that a woman employee shall not get
married, or to stipulate expressly or tacitly that upon
getting married a woman employee shall be deemed
resigned or separated, or to actually dismiss, discharge,
discriminate or otherwise prejudice a woman employee
merely by reason of her marriage.
Petitioners allege that its policy "may appear to be
contrary to Article 136 of the Labor Code" but it
assumes a new meaning if read together with the
first paragraph of the rule.
The rule does not require the woman employee to
resign. The employee spouses have the right to
choose who between them should resign. Further,
they are free to marry persons other than co-
employees. Hence, it is not the marital status of the
employee, p e r s e , that is being discriminated. It is
only intended to carry out its no-employment-for-
relatives-within-the-third-degree-policy which is within
the ambit of the prerogatives of management.
These policies focus upon the potential employment
problems arising from the perception of favouritism
exhibited towards relatives.
With more women entering the workforce, employers
are also enacting employment policies specifically
prohibiting spouses from working for the same
company.
We note that two types of employment policies
involve spouses: policies banning only spouses from
working in the same company (no-spouse employment
policies no-spouse employment policies), and those
banning all immediate family members, including
spouses, from working in the same company (anti-
nepotism employment policies anti-nepotism
employment policies).
In challenging the anti-nepotism employment policies in
the United States, complainants utilize two theories of
employment discrimination: the disparate treatment
and the disparate impact.
Under the disparate treatment analysis disparate
treatment analysis, the plaintiff must prove that an
employment policy is discriminatory on its face.
No-spouse employment policies requiring an
employee of a particular sex to either quit, transfer,
or be fired are facially discriminatory.
For example, an employment policy prohibiting the
employer from hiring wives of male employees, but
not husbands of female employees, is discriminatory
on its face.
On the other hand, to establish disparate impact, the
complainants must prove that a facially neutral
policy has a disproportionate effect on a particular
class.
For example, although most employment policies do
not expressly indicate which spouse will be required
to transfer or leave the company, the policy often
disproportionately affects one sex.
*They reason that the no-spouse employment policy
violate the marital status provision because it
arbitrarily discriminates against all spouses of
present employees without regard to the actual
effect on the individual's qualifications or work
performance.
 [LABOR LAW CASE DIGEST] ATTY. CARLISLE FABIE
These courts also find the no-spouse employment
policy invalid for failure of the employer to present
any evidence of BUSINESS NECESSITY other than
the general perception that spouses in the same
workplace might adversely affect the business.
They hold that the absence of such a bona fide
occupational qualification invalidates a rule denying
employment to one spouse due to the current
employment of the other spouse in the same office.
Thus, they rule that unless the employer can prove that
the reasonable demands of the business require a
distinction based on marital status and there is no
better available or acceptable policy which would better
accomplish the business purpose, an employer may
not discriminate against an employee based on the
identity of the employee's spouse. (BONA FIDE
OCCUPATIONAL EXCEPTION)
A bona fide occupational qualification justifies an
employer's no-spouse rule.
There must be a compelling business necessity for
which no alternative exists other than the discriminatory
practice.
To justify a bona fide occupational qualification, the
employer must prove two factors:
(1) that the employment qualification is reasonably
related to the essential operation of the job involved;
and,
(2) that there is a factual basis for believing that all or
substantially all persons meeting the qualification
would be unable to properly perform the duties of
the job.
IN THE CASE OF DUNCUN ASSOC. VS GLAXO, we
passed on the validity of the policy of a
pharmaceutical company prohibiting its employees
from marrying employees of any competitor
company. We held that Glaxo has a right to guard its
trade secrets, manufacturing formulas, marketing
strategies and other confidential programs and
information from competitors.
We considered the prohibition against personal or
marital relationships with employees of competitor
companies upon Glaxo's employees reasonable under
the circumstances because relationships of that
nature might compromise the interests of Glaxo. In
laying down the assailed company policy, we recognized
that Glaxo only aims to protect its interests against
the possibility that a competitor company will gain
access to its secrets and procedures.
The requirement of reasonableness must be clearly
clearly established to uphold the questioned
employment policy. The employer has the burden to
prove the existence of a reasonable business
necessity. The burden was successfully discharged in
Duncan but not in PT&T.
WE DO NOT FIND A REASONABLE BUSINESS
NECESSITY IN THE CASE AT BAR.
Petitioners' sole contention that "the company did not
just want to have two (2) or more of its employees
related between the third degree by affinity and/or
consanguinity" is lame. That the second paragraph
was meant to give teeth to the first paragraph of the
questioned rule is evidently not the valid reasonable
business necessity required by the law.
It is significant to note that in the case at bar,
respondents were hired after they were found fit for the
job, but were asked to resign when they married a co-
employee. Petitioners failed to show how the
marriage of Simbol, then a Sheeting Machine Operator,
to Alma Dayrit, then an employee of the Repacking
Section, could be detrimental to its business
operations.
Neither did petitioners explain how this detriment will
happen in the case of Wilfreda Comia, then a
Production Helper in the Selecting Department, who
married Howard Comia, then a helper in the cutter-
machine.
The policy is premised on the mere fear that
employees married to each other will be less
efficient. If we uphold the questioned rule without
valid justification, the employer can create policies
based on an unproven presumption of a perceived
danger at the expense of an employee's right to
security of tenure.
The questioned policy may not facially violate Article
136 of the Labor Code but it creates a
disproportionate effect and under the disparate
impact theory, the only way it could pass judicial
scrutiny is a showing that it is reasonable despite the
discriminatory, albeit disproportionate, effect. The failure
of petitioners to prove a legitimate business concern
in imposing the questioned policy cannot prejudice
 [LABOR LAW CASE DIGEST] ATTY. CARLISLE FABIE
the employee's right to be free from arbitrary
discrimination based upon stereotypes of married
persons working together in one company.
Thus, for failure of petitioners to present undisputed
proof of a reasonable business necessity, we rule that
the questioned policy is an invalid exercise of
management prerogative.
MA. LOURDES T. DOMINGO VS ROGELIO I.
RAYALA
FACTS:
Ma. Lourdes T. Domingo (Domingo), then
Stenographic Reporter III at the NLRC, led a
Complaint for sexual harassment against Rayala
before Secretary Bienvenido Laguesma of the
Department of Labor and Employment (DOLE).
Upon receipt of the Complaint, the DOLE
Secretary referred the Complaint to the OP,
Rayala being a presidential appointee. The OP,
through then Executive Secretary Ronaldo
Zamora, ordered Secretary Laguesma to
investigate the allegations in the Complaint and
create a committee for such purpose in accordance
with the RA 7877, The Anti-Sexual Harassment
Act of 1995.
It found Rayala guilty of the offense charged and
recommended the imposition of the minimum
penalty provided under AO 250.
“What aggravates respondent's situation is
the undeniable circumstance that he took
advantage of his position as the superior of the
complainant. Respondent occupies the highest
position in the NLRC, being its Chairman. As head
of said office, it was incumbent upon
respondent to set an example to the others as
to how they should conduct themselves in
public office, to see to it that his subordinates work
efficiently in accordance with Civil Service Rules
and Regulations, and to provide them with
healthy working atmosphere wherein co-
workers treat each other with respect, courtesy
and cooperation, so that in the end the public
interest will be benefited ( City Mayor of
Zamboanga vs. Court of Appeals) , 182 SCRA
785 [1990]).
“What is more, public service requires the
utmost integrity and strictest discipline( Gano
vs. Leonen), 232 SCRA 99 [1994]). Thus, a public
servant must exhibit at all times the highest
sense of honesty and integrity, and "utmost
devotion and dedication to duty" (Sec. 4 (g), RA
6713), respect the rights of others and shall
refrain from doing acts contrary to law, and
good morals (Sec. 4 (c)). No less than the
Constitution sanctifies the principle that a public
office is a public trust, and enjoins all public
officers and employees to serve with the
highest degree of responsibility, integrity,
loyalty and efficiency (Section 1, Article XI, 1987
Constitution).
Rayala filed a Motion for Reconsideration, which
the OP denied in a Resolution.
He then led a Petition for Certiorari and
Prohibition with Prayer for Temporary Restraining.
However, the same was dismissed in a
Resolution for disregarding the hierarchy of courts.
Rayala led a Motion for Reconsideration.
The CA rendered its Decision. It held that there
was sufficient evidence on record to create moral
certainty that Rayala committed the acts he was
charged with.
Rayala likewise led a Petition for Review with
this Court essentially arguing that he is not guilty
of any act of sexual harassment.
Rayala timely led a Motion for Reconsideration
and the penalty was modified to the effect that the
penalty of dismissal is DELETED and instead the
penalty of suspension from service for the
maximum period of one (1) year.
Domingo assails the CA's resolution modifying
the penalty imposed by the Office of the
President.
PETITIONERS CONTENTION
 [LABOR LAW CASE DIGEST] ATTY. CARLISLE FABIE
She argues that the power to remove Rayala, a
presidential appointee, is lodged with the
President who has control of the entire Executive
Department, its bureaus and offices. The OP's
decision was arrived at after affording Rayala due
process. Hence, his dismissal from the service is
a prerogative that is entirely with the President.
RESPONDENTS CONTENTION
Invoking Aquino v Acosta , Rayala argues that the
case is the definitive ruling on what constitutes
sexual harassment. Thus, he posits that for sexual
harassment to exist under RA 7877, there must
be:
(a) demand, request, or requirement of a sexual
favor;
(b) the same is made a pre-condition to hiring, re-
employment, or continued employment; or
(c) the denial thereof results in discrimination
against the employee.
Rayala asserts that Domingo has failed to allege
and establish any sexual favor, demand, or
request from petitioner in exchange for her
continued employment or for her promotion.
According to Rayala, the acts imputed to him are
without malice or ulterior motive. It was merely
Domingo's perception of malice in his alleged acts
— a "product of her own imagination”.
Likewise, Rayala assails the OP's interpretation,
as upheld by the CA, that RA 7877 is malum
prohibitum such that the defense of absence of
malice is unavailing. He argues that sexual
harassment is considered an offense against a
particular person, not against society as a
whole. Thus, he claims that intent is an
essential element of the offense because the law
requires as a conditio sine qua non that a sexual
favor be first sought by the offender in order to
achieve certain specific results. Sexual
harassment is committed with the perpetrator's
deliberate intent to commit the offense.
Rule IV FORMS OF SEXUAL HARASSMENT
FORMS OF SEXUAL HARASSMENT
Section 1. Forms of Sexual Harassment .
— Sexual harassment may be committed in any of
the following forms:
a) Overt sexual advances;
b) Unwelcome or improper gestures of
affection; c) Request or demand for sexual favors
including but not limited to going out on dates,
outings or the like for the same purpose;
d) Any other act or conduct of a sexual
nature or for purposes of sexual gratification which
is generally annoying, disgusting or offensive to the
victim.
He posits that these acts alone without
corresponding demand, request, or requirement
do not constitute sexual harassment as
contemplated by the law. He alleges that the rule-
making power granted to the employer in Section 4
(a) of RA 7877 is limited only to procedural
matters. The law did not delegate to the employer
the power to promulgate rules which would provide
other or additional forms of sexual harassment, or
to come up with its own definition of sexual
harassment.
REPUBLIC CONTENTION
The Republic argues that Rayala's acts constitute
sexual harassment under AO 250. His acts
constitute unwelcome or improper gestures of
affection and are acts or conduct of a sexual
nature, which are generally annoying or offensive to
the victim
It also contends that there is no legal basis for the
CA's reduction of the penalty imposed by the
OP . Rayala's dismissal is valid and warranted
under the circumstances. The power to remove
the NLRC Chairman solely rests upon the
President, limited only by the requirements under
the law and the due process clause.
*The Republic further claims that, ALTHOUGH AO
250 provides only a one (1) year suspension, it will
 [LABOR LAW CASE DIGEST] ATTY. CARLISLE FABIE
not prevent the OP from validly imposing the
penalty of dismissal on Rayala. It argues that
EVEN THOUGH Rayala is a presidential
appointee, he is still subject to the Civil Service
Law. Under the Civil Service Law, disgraceful
and immoral conduct, the acts imputed to
Rayala, constitute grave misconduct
punishable by dismissal from the service. The
Republic adds that Rayala's position is invested
with public trust and his acts violated that trust;
thus, he should be dismissed from the service.
This argument, according to the Republic, is also
supported by Article 215 of the Labor Code,
which states that the Chairman of the NLRC holds
office until he reaches the age of 65 only during
good behavior. Since Rayala's security of tenure
is conditioned upon his good behavior, he may be
removed from office if it is proven that he has failed
to live up to this standard.
Rayala also raised a procedural issue as he
accuses the OSG, as counsel for the Republic, of
forum shopping because if filed a motion for
reconsideration.
ISSUE:
1. WON THE OSG WAS GUILTY OF FORUM
SHOPPING
2. WON RAYAL COMMITTED SEXUAL
HARASSMENT
3. IF HE DID, WHAT IS THE APPLICAPLE
PENALTY
HELD:
1. NO.
Based on the foregoing, it cannot be said that the
OSG is guilty of forum shopping. We must point
out that it was Rayala who led the petition in the
CA, with the Republic as the adverse party.
Rayala himself led a motion for reconsideration
of the CA's December 21, 2001 Decision, which
led to a more favorable ruling, i.e., the lowering
of the penalty from dismissal to one-year
suspension.
The parties adversely affected by this ruling
(Domingo and the Republic) had the right to
question the same on motion for
reconsideration. But Domingo directly led a
Petition for Review with this Court, as did
Rayala. When the Republic opted to file a
motion for reconsideration, it was merely
exercising a right. That Rayala and Domingo had
by then already led cases before the SC did not
take away this right. Thus, when this Court
directed the Republic to file its Comment on
Rayala's petition, it had to comply, even if it had
an unresolved motion for reconsideration with the
CA, lest it be cited for contempt.
Forum shopping is an act of a party, against
whom an adverse judgment or order has been
rendered in one forum, of seeking and possibly
securing a favorable opinion in another forum,
other than by appeal or special civil action for
certiorari. It consists of filing multiple suits
involving the same parties for the same cause of
action, either simultaneously or successively,
for the purpose of obtaining a favorable
judgment.
There is forum shopping when the following
elements concur:
(1) Identity of the parties or, at least, of
the parties who represent the same interest
in both actions;
(2) Identity of the rights asserted and relief
prayed for, as the latter is founded on the
same set of facts; and
(3) Identity of the two preceding
particulars such that any judgment
rendered in the other action will amount to
res judicata in the action under
consideration or will constitute litis
pendentia
2. YES.
 [LABOR LAW CASE DIGEST] ATTY. CARLISLE FABIE
It is noteworthy that the five CA Justices who
deliberated on the case were unanimous in
upholding the findings of the Committee and
the OP. They found the assessment made by the
Committee and the OP to be a "meticulous and
dispassionate analysis of the testimonies of the
complainant (Domingo), the respondent (Rayala),
and their respective witnesses."
That Rayala committed the acts complained of
— and was guilty of sexual harassment — is,
therefore, the common factual finding of not just
one, but three independent bodies: the
Committee, the OP and the CA. It should be
remembered 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. The
principle, therefore, dictates that such findings
should bind us.
He insists, however, that these acts do not
constitute sexual harassment, because Domingo
did not allege in her complaint that there was a
demand, request, or requirement of a sexual
favor as a condition for her continued employment
or for her promotion to a higher position. Rayala
urges us to apply to his case our ruling in
Aquino vs. Acosta.
We find respondent's insistence unconvincing.
Basic in the law of public officers is the three-fold
liabity rule , which states that the wrongful acts
or omissions of a public officer may give rise to
civil, criminal and administrative liability. An
action for each can proceed independently of the
others. This rule applies with full force to sexual
harassment.
The CA, thus, correctly ruled that Rayala's
culpability is not to be determined solely on the
basis of Section 3, RA 7877, because he is
charged with the administrative offense, not the
criminal infraction, of sexual harassment.
It should be enough that the CA, along with the
INVESTIGATION COMMITTEE and OFFICE OF
THE PRESIDENT, found substantial evidence to
support the administrative charge.
Yet, even if we were to test Rayala's acts strictly
by the standards set in Section 3, RA 7877, he
would still be administratively liable. It is true
that this provision calls for a "demand, request
or requirement of a sexual favor." But it is not
necessary that the demand, request or
requirement of a sexual favor be articulated in a
categorical oral or written statement. It may be
discerned, with equal certitude, from the acts of
the offender.
Holding and squeezing Domingo's shoulders,
running his fingers across her neck and tickling her
ear, having inappropriate conversations with her,
giving her money allegedly for school expenses
with a promise of future privileges, and making
statements with unmistakable sexual overtones —
all these acts of Rayala resound with deafening
clarity the unspoken request for a sexual favor.
Likewise, contrary to Rayala's claim, it is not
essential that the demand, request or
requirement be made as a condition for
continued employment or for promotion to a
higher position. It is enough that the respondent's
acts result in creating an intimidating, hostile or
offensive environment for the employee. That the
acts of Rayala generated an intimidating and
hostile environment for Domingo is clearly
shown by the common factual finding of the
Investigating Committee, the OP and the CA that
Domingo reported the matter to an officemate and,
after the last incident, led for a leave of absence
and requested transfer to another unit.
Rayala's invocation of Aquino vs. Acosta is
misplaced, because the factual setting in that
case is different from that in the case at bench. In
Aquino, Atty. Susan Aquino, Chief of the Legal and
Technical Staff of the Court of Tax Appeals
(CTA), charged then CTA Presiding Judge (now
Presiding Justice) Ernesto Acosta of sexual
harassment. She complained of several incidents
when Judge Acosta allegedly kissed her, embraced
her, and put his arm around her shoulder. The case
 [LABOR LAW CASE DIGEST] ATTY. CARLISLE FABIE
was referred to CA Justice Josena G. Salonga for
investigation. In her report, Justice Salonga found
that "the complainant failed to show by
convincing evidence that the acts of Judge
Acosta in greeting her with a kiss on the cheek, in a
'beso-beso' fashion, were carried out with lustful
and lascivious desires or were motivated by malice
or ill motive. It is clear from the circumstances
that most of the kissing incidents were done on
festive and special occasions", and they "took
place in the presence of other people and the
same was by reason of the exaltation or
happiness of the moment.
In the instant case, Rayala's acts of holding and
squeezing Domingo's shoulders, running his fingers
across her neck and tickling her ear, and the
inappropriate comments, were all made in the
confines of Rayala's office when no other
members of his staff were around. More
importantly, and a circumstance is absent in
Aquino.
What is before us is an administrative case for
sexual harassment. Thus, whether the c rim e of
sexual harassment is mala in se or malum
prohibitum is immaterial.
Furthermore, Rayala decries the alleged violation
of his right to due process. He accuses the
Committee on Decorum of railroading his trial for
violation of RA 7877. He also scored the OP's
decision finding him guilty of "disgraceful and
immoral conduct" under the Revised Administrative
Code and not for violation of RA 7877.
Considering that he was not tried for
"disgraceful and immoral conduct", he argues
that the verdict is a "sham and total nullity".
Rayala was properly accorded due process.
[i]n administrative proceedings, due process
has been recognized to include the following:
(1) the right to actual or constructive notice of
the institution of proceedings which may affect a
respondent's legal rights;
(2) a real opportunity to be heard personally or
with the assistance of counsel, to present
witnesses and evidence in one's favor, and to
defend one's rights;
(3) a tribunal vested with competent jurisdiction
and so constituted as to afford a person charged
administratively a reasonable guarantee of honesty
as well as impartiality; and
(4) a finding by said tribunal which is supported
by substantial evidence submitted for
consideration during the hearing or contained in the
records or made known to the parties affected.
It is noteworthy that under AO 250, sexual
harassment amounts to disgraceful and immoral
conduct. Thus,any finding of liability for sexual
harassment may also be the basis of culpability for
disgraceful and immoral conduct.
3.
Under AO 250, the penalty for the first offense is
suspension for six (6) months and one (1) day
to one (1) year, while the penalty for the second
offense is dismissal.
On the other hand, Section 22 (o), Rule XVI of the
Omnibus Rules Implementing Book V of the
Administrative Code of 1987 and Section 52 A
(15) of the Revised Uniform Rules on
Administrative Cases both provide that the first
offense of disgraceful and immoral conduct is
punishable by suspension of six (6) months and
one (1) day to one (1) year. A second offense is
punishable by dismissal.
*Under the Labor Code, the Chairman of the
NLRC shall hold office during good during good
behavior behavior until he or she reaches the
age of sixty-five, unless sooner removed for
unless sooner removed for cause as provided
by law cause as provided by law or becomes
incapacitated to discharge the duties of the
office.
In this case, it is the President of the Philippines, as
the proper disciplining authority, who would
 [LABOR LAW CASE DIGEST] ATTY. CARLISLE FABIE
determine whether there is a valid cause for the
removal of Rayala as NLRC Chairman. This
power, however, is qualified by the phrase "for
cause as provided by law". Thus, when the
President found that Rayala was indeed guilty of
disgraceful and immoral conduct, the Chief
Executive did not have unfettered discretion to
impose a penalty other than the penalty
provided by law for such offense. As cited
above, the imposable penalty for the first offense of
either the administrative offense of sexual
harassment or for disgraceful and immoral conduct
is suspension of six (6) months and one (1) day to
one (1) year.
Accordingly, it was error for the Office of the
President to impose upon Rayala the penalty of
dismissal from the service, a penalty which can
only be imposed upon commission of a second
offense. Even if the OP properly considered the
fact that Rayala took advantage of his high
government position, it still could not validly
dismiss him from the service. Under the Under
the Revised Uniform Rules on Administrative
Cases in the civil service, taking undue
advantage of a subordinate may be considered
as an aggravating circumstance and where only
aggravating and no mitigating circumstances
are present, the maximum penalty shall be
imposed. Hence, the maximum penalty that can be
imposed on Rayala is suspension for one (1)
year.
DUNCAN ASSOCIATION OF DETAILMAN-
PTGWO VS. GLAXO
G.R. 162994. SEPTEMBER 17, 2004.
TINGA, J:
FACTS
On October 24, 1995 petitioner Tecson was hired
by respondent Glaxo Wellcome Philippines, Inc.
as medical representative. Thereafter, Tecson
signed a contract of employment which
stipulates, among others, that he agrees to study
and abide by existing company rules; to disclose
to management any existing or future
relationship by consanguinity or affinity with
co-employees or employees of competing drug
companies and should management find that such
relationship poses a possible conflict of interest,
to resign from the company.
The Employee Code of Conduct of Glaxo
similarly provides such stipulation but it poses
that if the management perceives a conflict of
interest or a potential conflict between such
relationship and the employee’s employment with
the company, the management and the employee
will explore the possibility of a “transfer to
another department in a non-counterchecking
position” or preparation for employment outside
the company after 6 months.
Subsequently, Tecson entered into a romantic
relationship with Bettsy, an employee of Astra
Pharmaceuticals, a competitor of Glaxo. Even
before they got married, Tecson received several
reminders from his District Manager regarding
the conflict of interest which his relationship
with Betssy might engender. Still, love prevailed,
and Tecson married Bettsy in September 1998.
In January 1999, Tecson’s superiors informed
him that his marriage to Betssy gave rise to
conflict of interest. Tecson’s superiors reminded
him that he and Betssy should decide which one
of them would resign from their jobs, although
they told him that they wanted to retain him as
much as possible because he was performing his
job well.
In September 1999, Tecson applied for a transfer
in Glaxo’s milk division, thinking that since Astra
did not have a milk division, the potential
conflict of interest would be eliminated. His
application was denied in view of Glaxo’s “least-
moment-possible” policy. In November 1999,
Glaxo transferred Tecson to the Butuan City-
Surigao City-Agusan del Sur sales area. Tecson
asked Glaxo to reconsider its decision. Glaxo
remained firm in its decision. Tecson defied the
transfer order and continued as acting medical
representative in the Camarines Sur-Camarines
Norte sales area.
 [LABOR LAW CASE DIGEST] ATTY. CARLISLE FABIE
On November 15, 2000, the National Conciliation
and Mediation Board rendered its Decision
declaraing as valid Glaxo’s policy on
relationships between its employees and
persons employed with competitor companies,
and affirming Glaxo’s right to transfer Tecson to
another sales territory.
Tecson filed a petitioner for review with the
Court of Appeals. On May 19, 2003 the Court of
Appeals denied the petitioner for review on the
ground that the NCMB did not err in rendering its
Decision. The appellate court held that Glaxo’s
policy prohibiting its employees from having
personal relationship with employees of
competitor companies is a valid exercise of its
management prerogatives.
ISSUE:
WHETHER OR NOT THE POLICY OF A
PHARMACEUTICAL COMPANY PROHIBITING
ITS EMPLOYEES FROM MARRYING
EMPLOYEES OF ANY COMPETITOR COMPANY
IS VALID.
RULING: YES
No reversible error can be ascribed to the Court
of Appeals when it ruled that Glaxo’s policy
prohibiting an employee from having a relationship
with an employee of a competitor company is a
valid exercise of management prerogative.
Glaxo has a right to guard its trade secrets,
manufacturing formulas, marketing strategies and
other confidential programs and information from
competitors, especially so that it and Astra are
rival companies in the highly competitive
pharmaceutical industry. Astra’s products were in
direct competition with 67% of the products sold by
Glaxo.
The prohibition against personal or marital
relationships with employees of competitor
companies upon Glaxo’s employees is reasonable
under the circumstances because relationships
of that nature might compromise the interest of
the company. Glaxo only aims to protect its
interests against the possibility that a competitor
company will gain access to its secrets and
procedures.
Indeed, while our laws endeavor to give life to
the constitutional policy on social justice and
the protection of labor, it does not mean that
every labor dispute will be decided in favor of
the workers. The law also recognizes that
management has rights which are also entitled
to respect and enforcement in the interests of
fair play.
It is clear that Glaxo does not impose an
absolute prohibition against relationships
between its employees and those of competitor
companies. Its employees are free to cultivate
relationships with and marry persons of their own
choosing. What the company merely seeks to
avoid is a conflict of interest between the
employee and the company that may arise out of
such relationships.
As succinctly explained by the appellate court, thus:
The policy being questions is not a
policy against marriage. An employee of the
company remains free to marry anyone of his or
her choosing. The policy is not aimed at
restricting a personal prerogative that belongs
only to the individual. However, an employee’s
personal decision does not detract the employer
from exercising management prerogatives to
ensure maximum profit and business success . .
.
[*Constructive dismissal is dened as a quitting,
an involuntary resignation resorted to when
continued employment becomes impossible,
unreasonable, or unlikely; when there is a demotion
in rank or diminution in pay; or when a clear
discrimination, insensibility or disdain by an
employer becomes unbearable to the employee]
 [LABOR LAW CASE DIGEST] ATTY. CARLISLE FABIE
PHILIPPINE TELEGRAPH AND TELEPHONE
COMPAB0NY VS NLRC AND GRACE DE
GUZMAN
FACTS:
Grace de Guzman was initially hired by
petitioner as a reliever, specifically as a
"Supernumerary Project Worker," for a fixed
period from November 21, 1990 until April 20,
1991 vice one C.F . Tenorio who went on
maternity leave. Under the Reliever Agreement
which she signed with petitioner company, her
employment was to be immediately terminated
upon expiration of the agreed period. Thereafter,
from June 10, 1991 to July 1, 1991, and from July
19, 1991 to August 8, 1991, private respondent'
s services as reliever were again engaged by
petitioner, this time in replacement of one Erlinda
F. Dizon who went on leave during both
periods. After August 8, 1991, and pursuant to
their Reliever Agreement, her services were
terminated.
On September 2, 1991, private respondent was
once more asked to join petitioner company as a
probationary employee, the probationary period
to cover 150 days. In the job application form that
was furnished her to be filled up for the purpose,
she indicated in the portion for civil status
therein that she was single although she had
contracted marriage a few months earlier, that
is, on May 26, 1991.
It now appears that private respondent had made
the same representation in the two successive
reliever agreements which she signed on June 10,
1991 and July 8, 1991. When petitioner
supposedly learned 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 company's policy of not
accepting married women for employment.
Private respondent stated that she was not
aware of PT&T's policy regarding married
women at the time, and that all along she had not
deliberately hidden her true civil status. Petitioner
nonetheless remained unconvinced by her
explanations. Private respondent was dismissed
from the company.
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.
LA handed down decision that the private
respondent had already gained the status of a
regular employee, and was illegally dismissed by
petitioner.
On appeal to the National Labor Relations
Commission (NLRC), said public respondent
upheld the labor arbiter
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 modied 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 order for the reinstatement of private
respondent in her employment with PT&T.
ISSUE:
WHETHER THE COMPANY POLICY IS
VIOLATIVE OF THE EQUAL PROTECTION LAW
AND DISCRIMINATE MARRIED WOMAN
HELD:
YES.
In the case at bar, petitioner's policy of not
accepting or considering as disqualified from
work any woman worker who contracts
marriage runs afoul of the test of, and the right
against, discrimination, afforded all women
workers by our labor laws and by no less than the
 [LABOR LAW CASE DIGEST] ATTY. CARLISLE FABIE
Constitution. Petitioner's policy is not only in
derogation of the provisions of Article 136 of
the Labor Code on the right of a woman to be
free from any kind of stipulation against
marriage in connection with her employment, but it
likewise assaults good morals and public
policy, tending as it does to deprive a woman of
the freedom to choose her status, a privilege
that by all accounts inheres in the individual as an
intangible and inalienable right.
Hence, while it is true that the parties to a
contract may establish any agreements, terms,
and conditions that they may deem convenient the
same should not be contrary to law, morals, good
customs, public order, or public policy. Carried to its
logical consequences, it may even be said that
petitioner's policy against legitimate marital
bonds would encourage illicit or common-law
relations and subvert the sacrament of
marriage.
While loss of confidence is a just cause of
termination of employment, it should not be
simulated. It must rest on an actual breach of
duty committed by the employee and not on the
employer's caprices. Furthermore, it should never
be used as a subterfuge for causes which are
improper, illegal, or unjustified.
Private respondent, it must be observed, had
gained regular status at the time of her
dismissal. When she was served her walking
papers on January 29, 1992, she was about to
complete the probationary period of 150 days
as she was contracted as a probationary
employee on September 2, 1991.
That her dismissal would be effected just when
her probationary period was winding down
clearly raises the plausible conclusion that it
was done in order to prevent her from earning
security of tenure. On the other hand, her earlier
stints with the company as reliever were
undoubtedly those of a regular employee, even if
the same were for fixed periods, as she performed
activities which were essential or necessary in
the usual trade and business of PT & T. The
primary standard of determining regular
employment is the reasonable connection
between the activity performed by the employee
in relation to the business or trade of the
employer.
As an employee who had therefore gained regular
status, and as she had been dismissed without just
cause, she is entitled to reinstatement without loss
of seniority rights and other privileges and to full
back wages, inclusive of allowances and other
benefits or their monetary equivalent.
*The Constitution, cognizant of the disparity in
rights between men and women in almost all
phases of social and political life, provides a
gamut of protective provisions. To cite a few of
the primordial ones, Section 14, Article II on the
Declaration of Principles and State Policies,
expressly recognizes the role of women in nation-
building and commands the State to ensure, at all
times, the fundamental equality before the law of
women and men. Corollary thereto, Section 3 of
Article XIII (the progenitor whereof dates back to
both the 1935 and 1973 Constitution) pointedly
requires the State to afford full protection to
labor and to promote full employment and
equality of employment opportunities for all,
including an assurance of entitlement to
tenurial security of all workers. Similarly,
Section 14 of Article XIII mandates that the State
shall protect working women through provisions for
opportunities that would enable them to reach their
full potential.
KASAMBAHAY
APEX MINING COMPANY, INC VS. NLRC AND
SINLITICA
FACTS:
Private respondent Sinclitica Candido was
employed by petitioner Apex Mining Company,
Inc. on May 18, 1973 to perform laundry services
at its staff house located at Masara, Maco, Davao
del Norte. In the beginning, she was paid on a
piece rate basis. However, on January 17, 1982,
she was paid on a monthly basis at P250.00 a
 [LABOR LAW CASE DIGEST] ATTY. CARLISLE FABIE
month which was ultimately increased to
P575.00 a month.
On December 18, 1987, while she was attending to
her assigned task and she was hanging her
laundry, she accidentally slipped and hit her
back on a stone. She reported the accident to
her immediate supervisor Mila de la Rosa and to
the personnel officer, Florendo D. Asirit. As a result
of the accident she was not able to continue with
her work. She was permitted to go on leave for
medication. De la Rosa offered her the amount of
P2,000.00 which was eventually increased to
P5,000.00 to persuade her to quit her job, but
she refused the offer and preferred to return to
work. Petitioner did not allow her to return to
work and dismissed her on February 4, 1988.
Private respondent filed a request for assistance
with the Department of Labor and Employment.
The latter rendered decision in favour of the
Sintlitica.
Not satisfied therewith, petitioner appealed to the
public respondent National Labor Relations
Commission (NLRC), wherein in due course a
decision was rendered by the Fifth Division thereof
on July 20, 1989 dismissing the appeal for lack
of merit and affirming the appealed decision. A
motion for reconsideration thereof was denied
in a resolution of the NLRC dated June 29, 1990.
Hence, the herein petition for review certiorari,
which appropriately should be a special civil action
for certiorari , and which in the interest of justice, is
hereby treated as such.
ISSUE:
WHETHER OR NOT THE PRIVATE
RESPONDENT SHOULD BE TREATED AS A
MERE HOUSEHELPER OR DOMESTIC
SERVANT AND NOT AS A REGULAR
EMPLOYEE OF PETITIONER
HELD:
Under Rule XIII, Section 1(b), Book 3 of the
Labor Code, as amended, the terms
"househelper" or "domestic servant" are defined
as follows:
"The term 'househelper' as used herein is
synonymous to the term 'domestic servant' and
shall refer to any person, whether male or female,
who renders services in and about the
employer's home and which services are usually
necessary or desirable for the maintenance and
enjoyment thereof, and ministers exclusively to the
personal comfort and enjoyment of the employer's
family."
The foregoing definition clearly contemplates
such househelper or domestic servant who is
employed in the employer's home to minister
exclusively to the personal comfort and
enjoyment of the employer's family. Such
definition covers family drivers, domestic
servants, laundry women, yayas, gardeners,
houseboys and other similar househelps.
The definition cannot be interpreted to include
househelp or laundry women working in
staffhouses of a company, like petitioner who
attends to the needs of the company's guest
and other persons availing of said facilities. By
the same token, it cannot be considered to extend
to the driver, houseboy, or gardener exclusively
working in the company, the staffhouses and its
premises. They may not be considered as within
the meaning of a "househelper" or "domestic
servant" as above-defined by law.
The criteria is the personal comfort and
enjoyment of the family of the employer in the
home of said employer. While it may be true that
the nature of the work of a househelper,
domestic servant or laundrywoman in a home or
in a company staffhouse may be similar in nature,
the difference in their circumstances is that in the
former instance they are actually serving the
family while in the latter case, whether it is a
corporation or a single proprietorship engaged
in business or industry or any other agricultural
or similar pursuit, service is being rendered in
the staffhouses or within the premises of the
business of the employer. In such instance, they
 [LABOR LAW CASE DIGEST] ATTY. CARLISLE FABIE

are employees of the company or employer in the

business concerned entitled to the privileges of a
regular employee.

The mere fact that the househelper or domestic

servant is working within the premises of the
business of the employer and in relation to or in
connection with its business, as in its
staffhouses for its guest or even for its officers
and employees, warrants the conclusion that
such househelper or domestic servant is and
should be considered as a regular employee of
the employer and not as a mere family
househelper or domestic servant as
contemplated in Rule XIII, Section 1(b), Book 3 of
the Labor Code, as amended.

Petitioner denies having illegally dismissed

private respondent and maintains that
respondent abandoned her work. This argument
notwithstanding, there is enough evidence to show
that because of an accident which took place while
private respondent was performing her laundry
services, she was not able to work and was
ultimately separated from the service. She is,
therefore, entitled to appropriate relief as a
regular employee of petitioner. Inasmuch as
private respondent appears not to be interested
in returning to her work for valid reasons, the
payment of separation pay to her is in order.