HSY MARKETING LTD. v. VIRGILIO O.

VILLASTIQUE
GR No. 219569, Aug 17, 2016

FACTS:

On January 10, 2011, respondent figured in an accident when the service vehicle he was driving
in Iligan City bumped a pedestrian, Ryan Dorataryo (Dorataryo). Fabulous Jeans shouldered the
hospitalization and medical expenses of Dorataryo in the amount of P64,157.15, which respondent was
asked to reimburse, but to no avail. On February 24, 2011, respondent was allegedly required to sign a
resignation letter, which he refused to do. A couple of days later, he tried to collect his salary for that
week but was told that it was withheld because of his refusal to resign. Convinced that he was already
terminated on February 26, 2011, he lost no time in filing a complaint for illegal dismissal with money
claims against petitioner before the NLRC.

In their defense, petitioner, et al. contended that respondent had committed several violations
in the course of his employment, and had been found by his superior and fellow employees to be a
negligent and reckless driver, which resulted in the vehicular mishap involving Dorataryo. After they paid
for Dorataryo's hospitalization and medical expenses, respondent went on absence without leave,
presumably to evade liability for his recklessness. Since respondent was the one who refused to report
for work, he should be considered as having voluntarily severed his own employment. Thus, his money
claims cannot prosper as he was not terminated.

ISSUE:

Whether or not the CA correctly:

(a) Found that an employment relationship existed between the parties in this case

(b) Affirmed the findings of the NLRC that respondent did not voluntarily resign from work and
petitioner did not dismiss him from employment, and consequently, awarded respondent separation
pay; and

(c) Declared respondent to be a regular employee and thus, awarded him service incentive leave pay.

RULING:

(a) In this case, the LA, the NLRC, and the CA consistently found petitioner liable as the
employer of respondent, the Court sees no compelling reason to depart from their judgment on
this score.

In fact, it is even worth noting that respondent claimed in his Position Paper before the
LA that he was hired by petitioner and was required to report for work at its store in Cagayan de
Oro City. This was confirmed by petitioner in its own Position Paper, declaring respondent to be
"a field driver for the Cagayan de Oro Branch of (petitioner) HSY MARKETING LTD., CO., (NOVO
 JEANS & SHIRT)." Clearly, petitioner should be bound by such admission and must not be
allowed to continue to deny any employer-employee relationship with respondent.

(b) The Court upholds the unanimous conclusion of the lower tribunals that respondent had
not been dismissed at all. No substantial evidence was presented to show that he was indeed
dismissed or was prevented from returning to his work.

Notably, the reinstatement ordered here should not be construed as a relief proceeding
from illegal dismissal; instead, it should be considered as a declaration or affirmation that the
employee may return to work because he was not dismissed in the first place. For this reason,
the Court agrees with petitioner that the LA, the NLRC, and the CA erred in awarding separation
pay in spite of the finding that respondent had not been dismissed. Properly speaking, liability
for the payment of separation pay is but a legal consequence of illegal dismissal where
reinstatement is no longer viable or feasible. As a relief granted in lieu of reinstatement, it goes
without saying that an award of separation pay is inconsistent with a finding that there was no
illegal dismissal. This is because an employee, who had not been dismissed, much less illegally
dismissed, cannot be reinstated.

Moreover, as there is no reinstatement to speak of, respondent cannot invoke the

doctrine of strained relations

The award of separation pay cannot be justified solely because of the existence of
"strained relations" between the employer and the employee. It must be given to the employee
only as an alternative to reinstatement emanating from illegal dismissal. When there is no illegal
dismissal, even if the relations are strained, separation pay has no legal basis. Besides, the
doctrine on "strained relations" cannot be applied indiscriminately since every labor dispute
almost invariably results in "strained relations;" otherwise, reinstatement can never be possible
simply because some hostility is engendered between the parties as a result of their
disagreement. That is human nature.

(c) The Court has already held that company drivers who are under the control and
supervision of management officers — like respondent herein — are regular employees entitled
to benefits including service incentive leave pay.

Petitioner, as the employer of respondent, and having complete control over the
records of the company, could have easily rebutted the said monetary claim against it by
presenting the vouchers or payrolls showing payment of the same. However, since petitioner
opted not to lift a finger in providing the required documentary evidence, the ineluctable
conclusion that may be derived therefrom is that it never paid said benefit and must, perforce,
be ordered to settle its obligation to respondent.
XAVIER C. RAMOS vs. BPI FAMILY SAVINGS BANK INC. and/or ALFONSO L. SALCEDO, JR.,
G.R. No. 203186, December 4, 2013

FACTS:

Ramos was employed by BPI Family in 1995 and eventually became its Vice-President for Dealer
Network Marketing/Auto Loans Division. During his tenure, a client named Trezita B. Acosta (Acosta)
entered into and obtained several auto and real estate loans from BPI Family which were duly approved
and promptly paid.

On December 15, 2004, Acosta secured another auto loan from BPI Family in the amount of
₱3,097,392.00 for the purchase of a Toyota Prado vehicle (subject loan) which had remained unpaid. As
it turned out, Acosta did not authorize nor personally apply for the subject loan, rendering the
transaction fraudulent.

BPI Family lost ₱2,294,080.00, which amount was divided between Ramos and his three (3)
other subordinates, with Ramos shouldering the proportionate amount of ₱546,000.00.

The foregoing amount was subsequently deducted from Ramos’s benefits which accrued upon
his retirement. In relation thereto, he executed a Release, Waiver and Quitclaim dated June 21, 2006,
agreeing to release the bank from any claim or liability with respect to, inter alia, his separation pay or
retirement benefits.

Claiming that the deductions made by BPI Family were illegal, Ramos filed a complaint for
underpayment of retirement benefits and non- payment of overtime and holiday pay and premium pay
against BPI Family and/or its President at that time, Alfonso L. Salcedo, Jr., before the Regional
Arbitration Branch of the NLRC.

The Labor Arbiter (LA) dismissed Ramos’s complaint, ruling that the deduction made on his
retirement benefits was "legal and even reasonable" since Ramos was negligent in running his
department.

On appeal, the NLRC reversed the LA in a Decision, holding that the deduction complained of
was "illegal and unreasonable"

The CA affirmed the finding of negligence on the part of Ramos, holding that Ramos was remiss
in his duty as head of Dealer Network Marketing/Auto Loans Division in failing to determine the true
identity of the person who availed of the auto loan under the name "Trezita Acosta". It also attributed
negligence on the part of BPI Family since it sanctioned the practice of issuing the PO and ATD prior to
the approval of the credit committee. Such relaxed supervision over its divisions contributed to a large
extent to its defraudation.
 Thus, finding BPI Family’s negligence to be concurrent with Ramos, the CA found it improper to
deduct the entire ₱546,000.00 from Ramos’s retirement benefits and, instead, equitably reduced the
same to the amount of ₱200,000.00.

ISSUE:

Whether or not the CA erred in attributing grave abuse of discretion on the part of the NLRC
when it found the deduction made from Ramos’s retirement benefits to be illegal and unreasonable?

RULING:

The petition is meritorious.

The Court finds the CA to have erred in attributing grave abuse of discretion on the part of the
NLRC in finding that the deduction made from Ramos’s retirement benefits was improper. Two (2)
reasons impel the foregoing conclusion:

First, as correctly observed by the NLRC, BPI Family was not able to substantially prove its
imputation of negligence against Ramos.

In this case, BPI Family failed to establish that the duty to confirm and validate information in
credit applications and determine credit worthiness of prospective loan applicants rests with the Dealer
Network Marketing Department, which is the department under the supervision of Ramos. Quite the
contrary, records show that these responsibilities lie with the bank’s Credit Services Department,
namely its Credit Evaluation Section and Loans Review and Documentation Section, of which Ramos was
not part of.

Second, as similarly observed by the NLRC, Ramos merely followed standing company practice
when he issued the PO and ATD without prior approval from the bank’s Credit Services Department. In
fact, as the CA itself notes, BPI Family adopted the practice of processing loans with extraordinary haste
in order to overcome arduous competition with other banks and lending institutions, despite
compromising procedural safeguards, viz.

Based on the foregoing, it is readily apparent that Ramos’s action of issuing the PO and ATD
ahead of the approval of the credit committee was actually conformant to regular company practice
which BPI Family itself sanctioned. As such, Ramos cannot be said to have been negligent ion his duties.
CRISPIN B. LOPEZ vs. IRVINE CONSTRUCTION CORP. and TOMAS SY SANTOS
G.R. No. 207253, August 20, 2014

FACTS:

Respondent Irvine Construction Corp. (Irvine) initially hired Lopez as laborer in November 1994
and, thereafter, designated him as a guard at its warehouse in Dasmarifias, Cavite in the year 2000, with
a salary of ₱238.00 per day and working hours from 7 o'clock in the morning until 4 o'clock in the
afternoon, without any rest day.

On December 18, 2005, Lopez was purportedly terminated from his employment, whereupon
he was told "Ikaw ay lay-off muna." Thus, on January 10, 2006, he filed a complaint for illegal dismissal
with prayer for the payment of separation benefits against Irvine.

For its part, Irvine denied Lopez's claims, alleging that he was employed only as a laborer who,
however, sometimes doubled as a guard. As laborer, Lopez's duty was to bring construction materials
from the suppliers' vehicles to the company warehouse when there is a construction project in Cavite.
As evidenced by an Establishment Termination Report11 dated December 28, 2005 which Irvine
previously submitted before the Department of Labor and Employment (DOLE), Lopez was, however,
temporarily laid-off on December 27, 2005 after the Cavite project was finished. Eventually, Lopez was
asked to return to work through a letter 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.

The Labor Arbiter ruled that Lopez was illegally dismissed.

The NLRC upheld 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
tenure

The CA granted Irvine's certiorari petition 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. 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.
ISSUE:

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.

RULING:

The petition is meritorious.

The NLRC correctly ruled in this case, Lopez, as 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.

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 employer, 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.

In this case, Irvine failed to prove compliance with the parameters of Article 286 of the Labor
Code. As the records would show, it merely completed one of its numerous construction projects which
do not, by and of itself, amount to a bona fide suspension of business operations or undertaking. In
invoking Article 286 of the Labor Code, the paramount consideration should be the dire exigency of the
business of the employer that compels it to put some of its employees temporarily out of work. This
means that the employer should be able to prove that it is faced with a clear and compelling economic
reason which reasonably forces it to temporarily shut down its business operations or a particular
undertaking, incidentally resulting to the temporary lay-off of its employees.
MAERSK-FILIPINAS CREWING v. TORIBIO C. AVESTRUZ
GR No. 207010, Feb 18, 2015

FACTS:

In the course of the weekly inspection of the vessel's galley, Captain Charles C. Woodward
(Captain Woodward) noticed that the cover of the garbage bin in the kitchen near the washing area was
oily. As part of Avestruz's job was to ensure the cleanliness of the galley, Captain Woodward called
Avestruz and asked him to stand near the garbage bin where the former took the latter's right hand and
swiped it on the oily cover of the garbage bin, telling Avestruz to feel it. An argument ensued between
them.

Later that afternoon, Captain Woodward required Avestruz to state in writing what transpired in
the galley that morning. Avestruz complied and submitted his written statement on that same day.
Captain Woodward likewise asked Messman Jomilyn P. Kong (Kong) to submit his own written
statement regarding the incident, to which the latter immediately complied. On the very same day,
Captain Woodward informed Avestruz that he would be dismissed from service and be disembarked in
India.

Subsequently, he filed a complaint for illegal dismissal

In their defense, Maersk, A.P. Moller, and Agbayani (petitioners) claimed that during his stint on
the vessel, Avestruz failed to attend to his tasks, specifically to maintain the cleanliness of the galley,
which prompted Captain Woodward to issue weekly reminders. Unfortunately, despite the reminders,
Avestruz still failed to perform his duties properly. On June 22, 2011, when again asked to comply with
the aforesaid duty, Avestruz became angry and snapped, retorting that he did not have time to do all
the tasks required of him. As a result, Captain Woodward initiated disciplinary proceedings and
informed Avestruz during the hearing of the offenses he committed, i.e., his repeated failure to follow
directives pertaining to his duty to maintain the cleanliness of the galley, as well as his act of insulting an
officer. Thereafter, he was informed of his dismissal from service due to insubordination. Relative
thereto, Captain Woodward sent two (2) electronic mail messages (e-mails) to Maersk explaining the
decision to terminate Avestruz's employment and requesting for Avestruz's replacement. Avestruz was
discharged from the vessel and arrived in the Philippines on July 4, 2011.

The Labor Arbiter (LA) dismissed Avestruz's complaint for lack of merit. The LA found that he
failed to perform his duty of maintaining cleanliness in the galley, and that he also repeatedly failed to
obey the directives of his superior, which was tantamount to insubordination. In support of its finding,
the LA cited the Collective Bargaining Agreement (CBA) between the parties which considers the act of
insulting a superior officer by words or deed as an act of insubordination.

The NLRC sustained the validity of Avestruz's dismissal but found that petitioners failed to
observe the procedures laid down in Section 17 of the POEA-SEC
 The CA Ruled in a decision dated January 4, 2013, the CA reversed and set aside the rulings of
the NLRC and instead, found Avestruz to have been illegally dismissed.

ISSUE:

Whether or not the CA erred when it reversed and set aside the ruling of the NLRC finding that
Avestruz was legally dismissed and accordingly, dismissing the complaint, albeit with payment of
nominal damages for violation of procedural due process?

RULING:

Petitioners maintain that Avestruz was dismissed on the ground of insubordination, consisting of
his "repeated failure to obey his superior's order to maintain cleanliness in the galley of the vessel" as
well as his act of "insulting a superior officer by words or deeds." In support of this contention,
petitioners presented as evidence the e-mails sent by Captain Woodward, both dated June 22, 2011,
and time-stamped 10:07 a.m. and 11:40 a.m., respectively, which they claim chronicled the relevant
circumstances that eventually led to Avestruz's dismissal.

Petitioners failed to prove that he committed acts of insubordination which would warrant his
dismissal.

Insubordination, as a just cause for the dismissal of an employee, necessitates the concurrence
of at least two requisites: (1) the employee's assailed conduct must have been willful, that is,
characterized by a wrongful and perverse attitude; and (2) the order violated must have been
reasonable, lawful, made known to the employee, and must pertain to the duties which he had been
engaged to discharge.[

In this case, the contents of Captain Woodward's e-mails do not establish that Avestruz's
conduct had been willful, or characterized by a wrongful and perverse attitude. The Court concurs with
the CA's observation that Avestruz's statement regarding the incident in the galley deserves more
credence, being corroborated by Kong, a messman who witnessed the same.

Conversely, apart from Captain Woodward's e-mails, no other evidence was presented by the
petitioners to support their claims. While rules of evidence are not strictly observed in proceedings
before administrative bodies, petitioners should have offered additional proof to corroborate the
statements described therein

As in this case, it was incumbent upon the petitioners to present other substantial evidence to
bolster their claim that Avestruz committed acts that constitute insubordination as would warrant his
dismissal. At the least, they could have offered in evidence entries in the ship's official logbook showing
the infractions or acts of insubordination purportedly committed by Avestruz, the ship's logbook being
the official repository of the day-to-day transactions and occurrences on board the vessel. Having failed
to do so, their position that Avestruz was lawfully dismissed cannot be sustained.
 Similarly, the Court affirms the finding of the CA that Avestruz was not accorded procedural due
process, there being no compliance with the provisions of Section 17 of the POEA-SEC as above-cited,
which requires the "two-notice rule."

WHEREFORE, the petition is DENIED.