1. ART. 277 –NEW PUERTO COMMERCIAL VS. LOPEZFACTS:

New Puerto Commercial hired respondent Felix Gavan (Gavan) as a delivery panel driver and respondent Rodel Lopez (Lopez) as roving salesman.

Petitioner Richard Lim is the operations manager of New Puerto Commercial.

Under a rolling store scheme, petitioners assigned respondents to sell goods stocked in a van on cash or credit to the sari-sari stores of far-flung barangays and municipalities outside Puerto Princesa City, Palawan. Respondents were duty-bound to collect the accounts receivables and remit the same upon their return to petitioners’ store on a weekly basis.

Respondents filed a complaint for illegal dismissal and non-payment of monetary benefits against petitioners with the RD of DOLE.

Conciliation conference was held but the parties failed to reach an amicable settlement

complaint was endorsed for compulsory arbitration at the Regional Arbitration Branch of the NLRC

Nov 28, 2000- petitioners sent respondents notices to explain why they should not be dismissed for gross misconduct based on (1) the alleged misappropriation of their sales collections, and (2) their absence without leave for more than a month. The notice also required respondents to appear before petitioners’ lawyer on December 2, 2000 to give their side with regard to the foregoing charges. Respondents refused to attend said hearing.

Dec 6, 2000- Petitioners filed a complaint for 3 counts of estafa against respondents

Dec 7, 2000- Petitioners sent another set of notices to attend hearing but resp failed to attend.

Dec 18, 2000- petitioners served notices of termination on respondents on the grounds of gross misconduct and absence without leave for more than one month.

Feb 5, 2001- an info for estafa was filed

LA: DISMISSED (illegal dismissal)1. there is substantial evidence tending to establish that respondents

committed the misappropriation of their sales collections from the rolling store business

2. These acts constituted serious misconduct and formed sufficient bases for loss of confidence which are just causes for termination.

1. 3.The records also showed that respondents were given opportunities to explain their side

3. substantive and procedural due process both complied. dismisall is valid.4. petitioner failed to prove that they paid the 13mo pay due to

respondents. (pay respondents)

NLRC: AFFIRMED1. gross misconduct: misappropriating2. It noted that respondents never denied that

(1) they failed to surrender their collections to petitioners, and (2) they stopped reporting for work during the last week of October 2000

3. resp admitted misapp before the hearing officer during concialiation conference.

CA: AFFIRMED1. respondents were denied procedural due process2. formal investigation of respondents for misappropriation of company

funds was a mere afterthought 3. entitled to nominal damages for failure to comply with twin reqts

ISSUEWON respondents were denied procedural due process justifying the award of nominal damages HELD:YES

When the requirements of procedural due process are satisfied, the award of nominal damages is improper.

the dismissal was valid because it was based on just causes (i.e., grave misconduct and loss of trust and confidence) due to respondents’ misappropriation of their sales collections.

In termination proceedings of employees, procedural due process consists of the twin requirements of notice and hearing. The employer must furnish the employee with two written notices before the termination of employment can be effected:

(1) the first apprises the employee of the particular acts or omissions for which his dismissal is sought; and (2) the second informs the employee of the employer’s decision to dismiss him. The requirement of a hearing is complied with as long as there was an opportunity to be heard, and not necessarily that an actual hearing was conducted

An employee’s right to be heard in termination cases under Article 277 (b) as implemented by Section 2 (d), Rule I of the Implementing Rules of Book VI of the Labor Code should be interpreted in broad strokes. It is satisfied not only by a formal face to face confrontation but by any meaningful opportunity to controvert the charges against him and to submit evidence in support thereof. A hearing means that a party should be given a chance to adduce his evidence to support his side of the case and that the evidence should be taken into account in the adjudication of the controversy. “To be heard” does not mean verbal argumentation alone inasmuch as one may be heard just as effectively through written explanations, submissions or pleadings. Therefore, while the phrase “ample opportunity to be heard” [in Article 277 of the Labor Code] may in fact include an actual hearing, it is not limited to a formal hearing only. In other words, the existence of an actual, formal “trial-type” hearing, although preferred, is not absolutely necessary to satisfy the employee's right to be heard

The mere fact that the notices were sent to respondents after the filing of the labor complaint does not, by itself, establish that the same was a mere afterthought.

The surrounding circumstances of this case adequately explain why the requirements of procedural due process were satisfied only after the filing of the labor complaint. Sometime in the third week of October 2000, petitioners received information that respondents were not remitting their sales collections to the company. Thereafter, petitioners initiated an investigation by sending one of their trusted salesmen, Bagasala, in the route being serviced by respondents. To prevent a possible cover up, respondents were temporarily reassigned to a new route to service.

Subsequently, respondents stopped reporting for work after they got wind of the fact that they were being investigated for misappropriation of their sales collection

respondents filed the subject illegal dismissal case to pre-empt the outcome of the ongoing investigation.

Bagasala returned from his month-long investigation in the far-flung areas previously serviced by respondents and reported that respondents indeed failed to remit P2,257.03 in sales collections.

As a result, on November 28, 2000, termination proceedings were commenced against respondents by sending notices to explain with a notice of hearing scheduled on December 2, 2000. As narrated earlier, respondents failed to give their side despite receipt of said notices. Petitioners sent another set of notices to respondents on December 7, 2000 to attend a hearing on December 15, 2000 but respondents again refused to attend. Thus, on December 18, 2000, petitioners served notices of termination on respondents for gross misconduct in misappropriating their sales collections and absence without leave for more than a month. the award of nominal damages by the appellate court is improper.

it cannot be concluded that the sending of the notices and setting of hearings were a mere afterthought because petitioners were still awaiting the report from Bagasala when respondents pre-empted the results of the ongoing investigation by filing the subject labor complaint. For this reason, there was sufficient compliance with the twin requirements of notice and hearing even if the notices were sent and the hearing conducted after the filing of the labor complaint.

SC: REVERSED AND SETASIDE

.2. ART. 279 – UNITED LABORATORIES VS. DOMINGO

FACTS:Unilab is a prominent domestic corporation engaged in the manufacture, sale, marketing and distribution of pharmaceutical products

Respondents were former employees of Unilab assigned to the Distribution Accounting Department (DAD) servicing all the accounting requirements of Unilab’s sixteen (16) provincial depots—fourteen (14) distribution centers and two (2) area offices—spread nationwide.

2001, under a Physical Distribution Master Plan (PDMP), Unilab consolidated its finished goods inventories and logistics activities (warehousing, order processing and shipping) into one distribution center located in Metro Manila.

As a result, Unilab closed down its sixteen (16) provincial depots.

The job functions of the employees working thereat were declared redundant and their positions were abolished.

Unilab gave the redundant employees a separation package of two and a half (2½) months’ pay for every year of service.

7 January 2002: respondents REQUESTED for their separation or retirement from service under a separation PACKAGE SIMILAR OR EQUIVALENT to that of the redundant employees in the provincial depots. (Bagong Sibol Program)

Respondents were keen on retiring and receiving 2½ months’ pay for every year of service, and all the other benefits which Unilab had extended to the redundant employees in the provincial depots.

their positions are similarly situated [to] the ‘retired employees’ of [Unilab’s] distribution centers under the principle that ‘things that are alike should be treated alike’ since they also hold the position of ‘distribution personnel.’

UNILAB contentions: DENIED1. The PDMP is not a retirement program but a cost restructuring measure

which resulted in the redundancy of the job functions of the employees working in the provincial depots

2. No Bagong Sibol Program, United Retirement Plan (URP)3. Unilab implemented a Shared Services Policy (SSP)

o -which consolidated and centralized all accounting functions of the UNILAB Group of Companies

o -accounting services and requirements of the UNILAB Group of Companies, were merged into a single pool, and performed in Unilab’s main office.

o After the closure of the provincial depots, respondents were transferred and re-assigned to the accounting work pool pursuant to the SSP

RESP: 1. Constructive Dismissal nonpayment/underpayment of separation pay,

damages and attorney’s fees against Unilab2. availment of retirement benefits equivalent to the separation package of

the redundant employees. 3. BUT Cortez AND respondents Domingo and Remigio remained working at

UNILAB.

LA: DISMISSED1. pay separation pay

NLRC: AFFIRMED*Remegio and Cortez-amicable settlement (full settlement and quitclaim)

CA: REVERSED1. Constructively dismissed2. reinstate or sep pay3. full backwages from abolition up to finality4. did not drop Remegio

ISSUE: WON there is constructive dismissalHELD: NOThe closing of the provincial depots did not result in the abolition of respondents’ position as accountants. While they had assignments pertaining to the provincial depots, they did not perform goods distribution or warehousing functions. They were accountants and their work as such was appropriately covered by the SSP that transferred all accounting functions to the Finance Division of Unilab.

PDMP was a “cost restructuring strategy program” and that the SSP was a “recognized management prerogative.”

the legitimacy of Unilab’s plan and policy was not questioned by the respondents.

They wanted to avail of the separation package for employees declared redundant because of the PDMP. They refused their transfer to the centralized Financial Division as planned under the SSP.

When they were not included among those considered as redundant employees, they wanted their transfer to the Financial Division declared as “constructive dismissal,” and Unilab pronounced liable for damages and attorney’s fees, aside from non-payment of separation pay.

CONSTRUCTIVE DISMISSAL Constructive dismissal is a derivative of dismissal without cause; an

involuntary resignation, nay, a dismissal in disguise. It occurs when there is cessation of work because continued employment

is rendered impossible, unreasonable, or unlikely as 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 leaving the latter with no other option but to quit.

dismissal without cause is prohibited because of the Constitutional security of tenure of workers.

It should be remembered, however, that the entitlement of workers to security of tenure is correlative to the right of enterprises to reasonable returns on investments

The right of employees to security of tenure does not give them vested rights to their positions to the extent of depriving management of its prerogative to change their assignments or to transfer them.

Managerial prerogatives, on the other hand, are subject to limitations provided by law, collective bargaining agreements, and general principles of fair play and justice.

Simply put, security of tenure from which springs the concept of constructive dismissal is not an absolute right. It cannot be pleaded to avoid the transfer or assignment of employees according to the requirements of the employer’s business. Such transfer or assignment becomes objectionable only when it is not for “reasonable returns on investments,” and for “expansion and growth” which are constitutionally recognized employer’s rights, but is sought merely as a convenient cover for oppression.

Unilab instituted a cost restructuring strategy program called the Physical Distribution Master Plan (PDMP) which resulted in the closure of [Unilab’s] provincial depots

As a necessary consequence of the closure of [Unilab’s] provincial depots, the positions affected became redundant and were declared to be so

the personnel affected by the redundancy were separated from the service and paid a generous separation pay, i.e., 2.5 months’ pay for every year of service.

The resp were all accountants and/or performing accounting functions who, with the sole exception of complainant Cortez and prior to the implementation of the PDMP, were all assigned to the Distribution Division.

the abolition of departments or positions in the company is one of the recognized management prerogatives.

it is the prerogative of the employer to transfer and reassign employees for valid reasons and according to the requirements of its business. There is therefore nothing irregular or illegal in the transfer of [respondents] to the Finance Division after [Unilab] came up with its Shared Services Policy.

Retirement and redundancy, while both resulting in the cessation of employment relations, are two entirely different things

Petitioner has an elaborate Retirement Plan that lists all possible benefits for retiring and resigning employees, and, significantly to this case, a separate article on involuntary separation due to redundancy

The requirements for, and the benefits from, the several and different manners of termination of employment are, naturally, also distinct and different. The employees cannot mix and match rights and obligations which are set and settled by law or agreement of the parties. This is particularly evident in this case where respondents demanded either the redundancy of their services in the face of the employees’ continuing need for such services, or the benefits from redundancy upon their retirement or resignation

SC SETASIDE

3. ART. 279 – NATIONWIDE SECURITY VS. VALDERAMA

FACTS: Valderama was hired by petitioner as security guard on April 18, 2002. He was assigned at the Philippine Heart Center (PHC), Quezon City, until

his relief on January 30, 2006 Valderama was not given any assignment thereafter August 2, 2006, he filed a complaint for constructive dismissal and

nonpayment of 13th month pay, with prayer for damages against petitioner and Romeo Nolasco.

PETITIONER alleged voluntary resignation committed serious violations of the security rules in the workplace. was charged with conduct unbecoming for which he was required to

explain. failed to attend a mandatory seminar. suspended for 7 days were made to explain their failure to report for duty without informing

the office despite the instruction during their formation day but resp challenged him

abandonment

RESPONDENT relieved from employment

LA: CONSTRUCTIVE DISMISSAL1. involuntary resignation2. burden of proof: employer failed to discharge3. retraining course4. reinstatement plus backwages plus 13mo pay

NLRC: MODIFIED1. neither constructively terminated nor did he voluntarily resign.2. deleted backwages

CA: REVERESED AND SET ASIDE1. constructive dismissal2. floating status for more than six (6) months3. retraining course5. backwages

ISSUE: WON there is constructive dismissal

HELD:

YES

In cases involving security guards, a relief and transfer order in itself does not sever employment relationship between a security guard and his agency.

An employee has the right to security of tenure, but this does not give him a vested right to his position as would deprive the company of its prerogative to change his assignment or transfer him where his service, as security guard, will be most beneficial to the client.

The onus of proving that there is no post available to which the security guard can be assigned rests on the employer

When a security guard is placed on a "floating status," he does not receive any salary or financial benefit provided by law.

Due to the grim economic consequences to the employee, the employer should bear the burden of proving that there are no posts available to which the employee temporarily out of work can be assigned.

floating status for more than 6 months. relieved from January until August temporary inactivity or “floating status” of security guards should

continue only for six months. Otherwise, the security agency concerned could be liable for constructive dismissal.

The failure of petitioner to give respondent a work assignment beyond the reasonable six-month period makes it liable for constructive dismissal.

If there is a surplus of security guards caused by lack of clients or projects, the security agency may resort to retrenchment upon compliance with the requirements set forth in the Labor Code. In this way, the security agency will not to be held liable for constructive dismissal and be burdened with the payment of backwages.

did not present resignation letter March 2006: required resp to report for reassignment Feb 2006: alleged resignation

Petitioner capitalizes on the withdrawal of the cash and firearm bonds by respondent. It contends that the withdrawal of bonds sufficiently proved respondent’s intention to terminate his employment contract with petitioner.

cash bond and firearm bond are never withdrawable for as long as the security guard intends to remain an employee of the security agency.=not binding/not applicable

SC AFFIRMED

4. ART. 279 (BACKWAGES VS. SEPARATION PAY) – BORDOMEO VS. CA

FACTS:IPI Employees Union-Associated Labor Union (Union), representing the workers, had a bargaining deadlock with the IPI management. This deadlock resulted in the Union staging a strike and IPI ordering a lockout.

after assuming jurisdiction over the dispute, DOLE Secretary Ruben D. TorresNo ULP, NO illegal strike, enter into new CBA, union =SEBA

MROrdering the International Pharmaceutical Inc. to reinstate to their former positions with full backwages reckoned from 8 December 1989 until actually reinstated without loss of seniority rights and other benefits the "affected workers"

IP filed a petition for certiorari--> dismissedno grave abuse of discretion had attended the issuance of the assailed decisions--> became final

Union moved in the National Conciliation and Mediation Board in DOLE for their execution.

Regional Director Alan M. Macaraya of DOLE Region VII issued a Notice of Computation/Execution --> directed parties to submit computations--> only the computation from complainants including those that were not specifically mentioned in the Supreme Court decision were submitted and received by this office.

Upon verification of the Computation--> management is hereby directed to pay the employees including those that were not specifically mentioned in the decision but are similarly situated, the aggregate amount of (P43,650,905.87) involving (962) employees

Regional Director Macaraya increased the number of the workers to be benefitted to 962 employees – classified into six groups – and allocated to each group a share in the P43,650,905.87 award,

May 24, 1995 writ of execution was issuedfor the amount of P4,162,361.50 (which covered monetary claims corresponding to the period from January 1, 1989 to March 15, 1995) in favor of the 15 employees represented by Atty. Arnado,

another writ of executionamount of P1,200,378.92 in favor of the second group of employees. Objecting to the reduced computation for them, however, the second group of employees filed a Motion Declaring the Writ of Execution dated June 5, 1995 null and void.

IPI challenged the May 24, 1995 writ of execution

DOLE Secretary Jose Brillante, recalled and quashed the May 24, 1995 writ of execution, and declared and considered the case closed and terminated.15 employees appealed DOLE secretary granted. reinstated the May 24 writ of execution--> subject to the deduction of the sum of P745,959.39 already paid pursuant to quitclaims from the award of P4,162,361.50.22

Secretary Quisumbing declared the quitclaims executed by the employees on December 2, 3, and 17, 1993 without the assistance of the proper office of the DOLE unconscionable for having been entered into under circumstances showing vitiation of consent;

ruled that the execution of the quitclaims should not prevent the employees from recovering their monetary claims under the final and executory decisions dated December 26, 1990 and December 5, 1991, less the amounts received under the quitclaims.

IPI moved for a reconsideration.

Pending IPI MR--> Regional Director Macaraya issued a writ of execution in favor of the 15 employees represented by Atty. Arnado to recover P3,416,402.10 pursuant to the order dated August 27, 1996 of Secretary Quisumbing.

--> sheriff garnished the amount of P3,416,402.10 out of the funds of IPI with China Banking Corporation, which released the amount.

--> Hence, on September 11, 1996, the 15 employees represented by Atty. Arnado executed a Satisfaction of Judgment and Quitclaim/Release upon receipt of their respective portions of the award, subject to the reservation of their right to claim "unsatisfied amounts of separation pay as well as backwages reckoned from the date after 15 March 1995 and up to the present, or until separation pay is fully paid."

Notwithstanding the execution of the satisfaction of judgment and quitclaim/release-Atty. Arnado still filed an omnibus motion not only in behalf of the 15 employees but also in behalf of other employees named in the notice of computation/execution, with the exception of the second group, seeking another writ of execution to recover the further sum of P58,546,767.83.27

The employees belonging to the second group reiterated their Motion Declaring the Writ of Execution dated June 5, 1995 null and void, and filed on May 15, 1996 a Motion for Issuance of Writ, praying for another writ of execution based on the computation by Regional Director Macaraya.

Secretary Quisumbing, affirming his August 27, 1996 order-denied IPI’s Motion for Reconsideration for being rendered moot and academic by the full satisfaction of the May 24, 1995 writ of execution. -denied Atty. Arnado’s omnibus motion for lack of merit; and dealt with the issue involving the June 5, 1995 writ of execution issued in favor of the second group of employees, which the Court eventually resolved

Atty. Arnado filed a Motion for Execution with the DOLE Regional Office demanding the following amounts from IPI, to wit:

For Roberto Bordomeo and 14 others P4,990,401.00The rest of complainants 33,824,820.41Total P 38,815,221.41

DOLE Secretary Patricia Sto. Tomas Order affirming the order issued on March 27, 1998, and declaring that the full

execution of the order of March 27, 1998 "completely CLOSED and TERMINATED this case."

Petitioners Appealed to CA--> dismissed = case between petitioners and private respondent IPI have long attained finality.

PETITIONERSsix groups of employees classified under the April 12, 1995 notice of computation/execution issued by Regional Director Macaraya, only the first two groups, that is, the 15 employees initially represented by Atty. Arnado; and the nine salesmen led by Geronimo S. Banquirigo, had been granted a writ of execution.

May 24, 1995 writ of execution issued in favor of the first group of employee partially satisfied because no backwages or separation pay from March 16, 1995 onwards had yet been paid to them; that the reduced award granted to the second group of employees was in violation of the April 12, 1995 notice of computation/execution; that no writ of execution had been issued in favor of the other groups of employees; and that DOLE Secretary Sto. Tomas thus committed grave abuse of discretion in refusing to fully execute the December 26, 1990 and December 5, 1991 orders.

IPI--> petition for certiorari not proper remedy--> the more appropriate remedy being a petition for review on certiorari; that a petition for review on certiorari should have been filed within 15 days from receipt of the denial of the motion for reconsideration, as provided in Section 1 and Section 2 of Rule 45; -->and that the petition must also be outrightly dismissed for being filed out of time.

ISSUE: WON THE PETITIONERS ARE STILL ENTITLED TO SEPARATION PAY AND BACKWAGES (WRIT OF EXECUTION PARTIALLY SATISIFED?)

HELD: NO. THEIR DEMAND HAS BEEN FULLY COMPLIED WITH.

SC--> appeal by petition for review on certiorari under Rule 45 of the Rules of Court, to be taken to this Court within 15 days from notice of the judgment or final order raising only questions of law = PROPER REMEDY

*two writs of execution were NOT only partially satisfied. the two writs of execution issued were the one for P4,162,361.50, later reduced to P3,416,402.10, in favor of the 15 employees represented by Atty. Arnado, and that for P1,200,378.92 in favor of the second group of employees led by Banquerigo.

15 EMPLOYEES received P3,416,402.10 through the release of the garnished deposit of IPI at China Banking Corporation.--> then they executed satisfaction of judgment and quitclaim/release

--> DOLE secretary basis for the decision that writ of execution was fully satisfied case completed and terminated.

BUT STILL--> 15 employees demand payment of their separation pay and backwages from March 16, 1995 onwards pursuant to their reservation reflected in the satisfaction of judgment and quitclaim/release they executed

SC DEMAND OF 15 EMPLOYEE LACKED BASISDECISION OF DOLE SEC --> required IPI to reinstate the affected workers to their former positions with full backwages reckoned from December 8, 1989 until actually reinstated without loss of seniority rights and other benefits

--> REINSTATEMENT NO LONGER POSSIBLE - separation pay was instead paid-- "separation pay may avail in lieu of reinstatement if reinstatement is no

longer practical or in the best interest of the parties. Separation pay in lieu of reinstatement may likewise be awarded if the employee decides not to be reinstated. the employment of the 15 employees or the possibility of their reinstatement terminated by March 15, 1995 claim for separation pay and backwages beyond March 15, 1995 would be unwarranted. --> The computation of separation pay and backwages should not go beyond the date when they were deemed to have been actually separated from their employment, or beyond the date when their reinstatement was rendered impossible.

"The basis for the payment of backwages is different from that for the award of separation pay. Separation pay is granted where reinstatement is no longer advisable because of strained relations between the employee and the employer. Backwages represent compensation that should have been earned but were not collected because of the unjust dismissal. The basis for computing backwages is usually the length of the employee’s service while that for separation pay is the actual period when the employee was unlawfully prevented from working."

THUS an illegally dismissed employee is entitled to two reliefs:

backwages and reinstatement. - SEPARATE AND DISTINCT

SEPARATION PAY GRANTED WHEN--reinstatement is no longer feasible because of strained relations between the employee and the employerIn effect, an

The normal consequences of respondents’ illegal dismissal--> reinstatement without loss of seniority rights, and payment of backwages 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 (1) month salary for every year of service should be awarded as an alternative. The payment of separation pay is in addition to payment of backwages.

THUS, petitioner IS ENTITLED TO BACKWAGES AND SEPARATION PAY (reinstatement rendered impossible due to strained relations)

COMPUTATIONcomputed from the time he was unjustly dismissed until his actual reinstatement, or from February 1999 until June 30, 2005 when his reinstatement was rendered impossible without fault on his part

CA computation incorrectCA- only 8 yearsSC--> Petitioner was hired in 1990, however, and he must be considered to have been in the service not only until 1999, when he was unjustly dismissed, but until June 30, 2005, the day he is deemed to have been actually separated (his reinstatement having been rendered impossible) from petitioner company or for a total of 15 years.

SC dismissed petition

5. ART. 280 – ATOK BIG WEDGE COMPANY, INC. VS. GISONFACTS:RESP Jesus Gison part time consultant retainer basis by Atok Big Wedge Co.assisted petitioner's retained legal counsel with matters pertaining to the prosecution of cases against illegal surface occupants within the area covered by the company's mineral claims.tasked to perform liaison work with several government agencies, which he said was his expertise.

--required to report to its office on a regular basis, except when occasionally requested by the management to discuss matters needing his expertise as a consultant. As payment for his services, respondent received a retainer fee of P3,000.00 a month, which was delivered to him either at his residence or in a local restaurant.

The parties executed a retainer agreement, but such agreement was misplaced and can no longer be found. --> continued for 11 years

RESP getting old, requested pet to register him with SSS-- PET refused since RESP was only retainer or consultant

PET filed complaint with SSS for pet refusal to cause his registration

Resident manager of Pet issued a Memo advising resp that within 30 days from receipt his retainer contract will be terminated; services not necessary

RESP filed a Complaint for illegal dismissal, unfair labor practice, underpayment of wages, non-payment of 13th month pay, vacation pay, and sick leave pay

RESP allegations resident manager (Torres) approached him and asked him if he can help the company’s problem involving the 700 million pesos crop damage claims of the residents living at the minesite of Atok. participated in a series of dialogues conducted with the residents. Mr. Torres offered to pay him P3,000.00 per month plus representation expenses. AGREED that his participation in resolving the problem was temporary and there will be no employer-employee relationship between him and Atok. his compensation, allowances and other expenses will be paid through disbursement vouchers.

He joined Atok. After a week the aggrieved crop damage claimants barricaded the only passage to and from the minesite. a dialogue was made by Atok and the crop damage claimants. They were virtually held hostage by the irate claimants who demanded on the spot payment of their claims. He was able to convince the claimants to release the company representatives pending referral of the issue to higher management.

Another case erupted. Involved Atok's partner, benguet Corporation, Controversy was resolved. Atok received its share of 5Mworth of equipment and condonation of its accountabilities 900k.Crop damage claimants didi not pursue their claims

After the crop damage claims and the controversy were resolved, he was permanently assigned by Atok to take charge of some liaison matters and public relations in Baguio and Benguet Province, and to report regularly to Atok’s office in Manila to attend meetings and so he had to stay in Manila at least one week a month.

his length of service invited the attention of the top officers of the company that he is already entitled to the benefits due an employee under the law, but management ignored his requests. BUT he continued to avail of his representation expenses and reimbursement of company-related expenses.also enjoyed the privilege of securing interest free salary loans payable in one year through salary deduction.

RESP getting older (56y/o), requested to cause his registration. IGNORED. So he filed a complaint with SSS. RESP then terminated his services.

LAin favor of PET. NO EE. DISMISSED COMPLAINT

NLRCaffirmed

CA IN FAVOR of RESPset aside NLRCORDERED to reinstate petitioner Jesus P. Gison to his former or equivalent position without loss of seniority rights and to pay him full backwages, inclusive of allowances and other benefits or their monetary equivalent computed from the time these were withheld from him up to the time of his actual and effective reinstatementremanded to LA for proper computation

--> NLRC may have overlooked Article 280 or the provision which distinguishes between two kinds of employees, i.e., regular and casual employees.

--> respondent= regular after the lapse of 1 yr from his employment

=worked for 11 years. Entitled to right and privileges of a regular employee

=even if with agreement that employment is temporary, petitioner disregarded it by repeatedly giving RESP several tasks. =although respondent may have waived his right to attain a regular status of employment when he agreed to perform these tasks on a temporary employment status, still, it was the law that recognized and considered him a regular employee after his first year of rendering service to petitioner. WAIVER - INEFFECTIVE

PETITIONER= petition for review under RUle 65 --> CA should have limited the issue on whether or not there was grave abuse of discretion on the part of the NLRC

when existence of EE in dispute, ART 280 not applicable

=article only set the distinction between a casual employee from a regular employee for purposes of determining the rights of an employee to be entitled to certain benefits.=respondent is not a regular employee and not entitled to reinstatement.

RESPONDENT=maintains that he is an employee of the petitioner and that the CA did not err in ruling in his favor.

ISSUE: whether or not an employer-employee relationship exists between petitioner and respondent.Whether or not respondent is a regular employee (ART 280 applicable?) NO

HELD:NO.FOUR FOLD TEST(1) the selection and engagement of the employee; (2) the payment of wages; (3) the power of dismissal; and (4) the power to control the employee's conduct, or the so-called "control test." most important.The so-called “control test” is commonly regarded as the most crucial and determinative indicator of the presence or absence of an employer-employee relationship. Under the control test, an employer-employee relationship exists where the person for whom the services are performed reserves the right to control not only the end achieved, but also the manner and means to be used in reaching that end

NO EErespondent was not required to report everyday during regular office hours of petitioner. monthly retainer fees were paid to him either at his residence or a local restaurant. petitioner did not prescribe the manner in which respondent would accomplish any of the tasks in which his expertise as a liaison officer was needed; respondent was left alone and given the freedom to accomplish the tasks using his own means and method. Respondent was assigned tasks to perform, but petitioner did not control the manner and methods by which respondent performed these tasks.

AGREEMENT-services temporary. NO EE-complainant's compensations, allowances, representation expenses and reimbursement of company- related expenses will be processed and paid through disbursement vouchers

RESP aware that he is temporaryrespondent anchors his claim that he became a regular employee of the petitioner based on his contention that the “temporary” aspect of his job and its “limited” nature could not have lasted for eleven years unless some time during that period, he became a regular employee of the petitioner by continually performing services for the company.

SC- RESP not an employee; not regularappellate court's premise that regular employees are those who perform activities which are desirable and necessary for the business of the employer is not determinative in this case.

any agreement may provide that one party shall render services for and in behalf of another, no matter how necessary for the latter's business, even without being hired as an employee.

--> respondent's length of service (11 YEARS) and petitioner's repeated act of assigning respondent some tasks to be performed DID NOT result to respondent's entitlement to the rights and privileges of a regular employee

Article 280 NOT APPLICABLE (the lower court used to buttress its findings that respondent became a regular employee of the petitioner)

=Not the yardstick for determining the existence of an employment relationship because it merely distinguishes between two kinds of employees, i.e., regular employees and casual employees, for purposes of determining the right of an

employee to certain benefits, to join or form a union, or to security of tenure; it does not apply where the existence of an employment relationship is in dispute.

SC= NO ILLEGAL DISMISSAL.CA DECISION REVERSED AND SET ASIDE

6. ART 281 – ROBINSONS GALLERIA VS. RANCHEZFACTS:RESP probationary employee of Robinsons for 5 months.underwent 6 weeks of training as a cashier before she was hired.2 weeks after she was hired, she reported the loss of 20, 299 which she placed in the company locker

PET ordered that she be strip-searched =nothing was foundRESP acknowledged her responsibility to settle and pay the amount.

PET still reported her to the police.

An information for qualified theft was filed. She was jailed for two weeks,

RESP filed a complaint for Illegal dismissal and damages.

PET sent to respondent by mail a notice of termination and/or notice of expiration of probationary employment dated March 9, 1998

LAno illegal dismissalRespondents are ordered to accept complainant to her former or equivalent work without prejudice to any action they may take in the premises in connection with the missing money of P20,299.00.at the time respondent filed the complaint for illegal dismissal, she was not yet dismissed by petitioners. When she was strip- searched by the security personnel of petitioner Supermarket, the guards were merely conducting an investigation. The subsequent referral of the loss to the police authorities might be considered routine. Respondent’s non-reporting for work after her release from detention could be taken against her in the investigation that petitioner supermarket would conduct

NLRCreversed LArespondent was denied due process by petitioners. Strip-searching respondent and sending her to jail for two weeks certainly amounted to constructive dismissal because continued employment had been rendered impossible, unreasonable, and unlikely. The wedge that had been driven between the parties was impossible to ignore. Although respondent was only a probationary employee, the subsequent lapse of her probationary contract of employment did not have the effect of validly terminating her employment because constructive dismissal had already been effected earlier by petitioners

CAaffirmed NLRC

PETITIONERSassailed the reinstatementRESP only probationary employee. probationary contract of employment lapsed on March 14, 1998. Reinstatement=moot and academiceven if her probationary contract had not yet expired, the offense that she committed would nonetheless militate against her regularization

RESPONDENTalleged that she was constructively dismissed

when she was strip-searched, divested of her dignity, and summarily thrown in jail. She could not have been expected to go back to work after being allowed to post bail because her continued employment had been rendered impossible, unreasonable, and unlikely.

at the time the money was discovered missing, it was not with her but locked in the company locker. The company failed to provide its cashiers with strong locks and proper security in the work place.

she was not caught in the act and even reported that the money was missing.

denied due process

ISSUE: whether respondent was illegally terminated from employment by petitioners.

HELD:YES

There is probationary employment when the employee upon his engagement is made to undergo a trial period during which the employer determines his fitness to qualify for regular employment based on reasonable standards made known to him at the time of engagement

A probationary employee, like a regular employee, enjoys security of tenure. However, in cases of probationary employment, aside from just or authorized

causes of termination, an additional ground is provided under Article 281 of the Labor Code, i.e., the probationary employee may also be terminated for failure to qualify as a regular employee in accordance with reasonable standards made known by the employer to the employee at the time of the engagement.

Thus, the services of an employee who has been engaged on probationary basis may be terminated for any of the following: (1) a just or (2) an authorized cause; and (3) when he fails to qualify as a regular employee in accordance with reasonable standards prescribed by the employer. Article 277(b) of the Labor Code mandates that subject to the constitutional right of workers to security of tenure and their right to be protected against dismissal, except for just and authorized cause and without prejudice to the requirement of notice under Article 283 of the same Code, the employer shall furnish the worker, whose employment is sought to be terminated, a written notice containing a statement of the causes of termination, and shall afford the latter ample opportunity to be heard and to defend himself with the assistance of a representative if he so desires, in accordance with company rules and regulations pursuant to the guidelines set by the Department of Labor and Employment.

petitioners failed to accord respondent substantive and procedural due process. The haphazard manner in the investigation of the missing cash, which was left to the determination of the police authorities and the Prosecutor’s Office, left respondent with no choice but to cry foul.

Administrative investigation was not conducted by petitioner Supermarket. On the same day that the missing money was reported by respondent to her immediate superior, the company already pre-judged her guilt without proper investigation, and instantly reported her to the police as the suspected thief, which resulted in her languishing in jail for two weeks.

the due process requirements under the Labor Code are mandatory and may not be supplanted by police investigation or court proceedings. The criminal aspect of the case is considered independent of the administrative aspect.

employers should not rely solely on the findings of the Prosecutor’s Office. They are mandated to conduct their own separate investigation, and to accord the employee every opportunity to defend himself.

respondent was not represented by counsel when she was strip-searched inside the company premises or during the police investigation, and in the preliminary investigation before the Prosecutor’s Office. Respondent was constructively dismissed unreasonable to charge her with abandonment for not reporting for work upon her release in jail. It would be the height of callousness to expect her to return to work after suffering in jail for two weeks. Work had been rendered unreasonable, unlikely, and definitely impossible, considering the treatment that was accorded respondent by petitioners.

RESPONDENT’S MONETARY CLAIMSArticle 279 of the Labor Code provides that an employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges, to full backwages, inclusive of allowances, and to other benefits or their monetary equivalent computed from the time his compensation was withheld from him up to the time of his actual reinstatement.

BUT DUE TO STRAINED relationsseparation pay has been considered an acceptable alternative to reinstatementsuch payment liberates the employee from what could be a highly oppressive work environment. On the other, the payment releases the employer from the grossly unpalatable obligation of maintaining in its employ a worker it could no longer trust.

illegally or constructively dismissed employee, entitled to: (1) either reinstatement, if viable, or separation pay, if reinstatement is no longer viable; and (2) backwages. These two reliefs are separate and distinct from each other and are awarded conjunctively

RESP entitled to separation pay and backwagesreckoned from the time of her constructive dismissal until the date of the termination of her employment, i.e., from October 30, 1997 to March 14, 1998. The computation should not cover the entire period from the time her compensation was withheld up to the time of her actual reinstatement. because respondent was a probationary employee, and the lapse of her probationary employment without her appointment as a regular employee of petitioner Supermarket effectively severed the employer-employee relationship between the parties.

PROBATIONARY EMPLOYMENTIn all cases involving employees engaged on probationary basis, the employer shall make known to its employees the standards under which they will qualify as regular employees at the time of their engagement.

Where no standards are made known to an employee at the time, he shall be deemed a regular employee, unless the job is self-descriptive, like maid, cook, driver, or messenger. However, the constitutional policy of providing full protection to labor is not intended to oppress or destroy management.

Naturally, petitioner Supermarket cannot be expected to retain respondent as a regular employee considering that she lost P20,299.00 while acting as a cashier during the probationary period.

The rules on probationary employment should not be used to exculpate a probationary employee who acts in a manner contrary to basic knowledge and common sense, in regard to which, there is no need to spell out a policy or standard to be met.

SC- CA affirmed.

7. RADIN C. ALCIRA, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION, MIDDLEBY PHILIPPINES CORPORATION/FRANK THOMAS, XAVIER G. PEÑA and TRIFONA F. MAMARADLO, respondents.

LA, NLRC, CA- dismissed the complaint of Radin Acira for illegal dismissal with prayer for reinstatement, back wages, moral damages, exemplary damages and attorney’s fees.

Facts:

Petitioner Radin Alcira- hired as engineering support services supervisor of a probationary basis for 6 mos.

Respondent Middleby hilipppines Corporations (Middleby)- terminated R.Alcira’s services. Reason: unhappy with the performance of the petitioner.

Parties both showed a copy of appointment paper presenting conflicting starting dates.

o Alcira- May 20, 1996. Middledby- May 27, 1996o Status: probationary… after 5 mos his performance must be

evaluated and any adjustment with his salary shall depend on his work performance.

Nov 20, 1996- petitioner asserts that a senior officer of respondent Middleby in bad faith withheld his time card and did not allow him to work.

Nov 21, 1996- R. Alcira filed a complaint in NLRC. he contended that he was illegally dismissed and that he already became a regular employee because his probationary status had lapsed

Defense of Middleby- during petitioner’s probationary employment, he showed poor performance in his assigned tasks, incurred ten absences, was late several times and violated company rules on the wearing of uniform. Since he failed to meet company standards, petitioner’s application to become a regular employee was disapproved and his employment was terminated.

Ruling of Labor Arbiter - dismissed the complaint. Ground: (1) respondents were able to prove that petitioner was apprised of the standards for becoming a regular employee; (2) respondent Mamaradlo’s affidavit showed that petitioner “did not perform well in his assigned work and his attitude was below par compared to the company’s standard required of him” and (3) petitioner’s dismissal on November 20, 1996 was before his “regularization,” considering that, counting from May 20, 1996, the six-month probationary period ended on November 20, 1996.

Ruling of NLRC and CA affirmed. CA: no termination only expiration of contact. Probationary employment only, contractual in nature and employment is within a definite period. At the expiration of the contract his appointment was deemed terminated and no notice of non-renewal in necessary. Security of tenure can only be invoked during the period of probationary period. Upon expiration of the probationary period the constitutional protection of security of tenure could no longer be invoked.

Supreme Court – 3 issues

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.

1 st issue: WON Petitioner became a regular employee. NO

Petitioner claimed that his probationary period is only 5 mos. Because of the provision that he will be evaluated after 5 mos.

SC: petitioners argument lacks merit because it is stated in his appointment paper that his employment status was “probationary (6mos)”. The five month period he was referring was for the evaluation of his work.

Alcira(petitioner) insisted that he was already a regular employee- Petitioner insists that he already attained the status of a regular employee when he was dismissed on November 20, 1996 because, having started work on May 20, 1996, the six-month probationary period ended on November 16, 1996. According to petitioner’s computation, since Article 13 of the Civil Code provides that one month is composed of thirty days, six months total one hundred eighty days. As the appointment provided that petitioner’s status was “probationary (6 mos.)” without any specific date of termination, the 180th day fell on November 16, 1996. Thus, when he was dismissed on November 20, 1996, he was already a regular employee.

SC: Alcira is incorrect. SC’s computation of 6-month probationary period is reckoned from the date of appointment up to the same calendar date of the 6th month following.

o The number of days of each month is irrelevant. He is still a probationary employee when Middleby opted not to “regularized” him on Nov 20, 1996

2 nd issue: WON the respondent informed the petitioner of the standards for “regularization” at the start of his employment. YES

Section 6 (d) of Rule 1 of the Implementing Rules of Book VI of the Labor Code (Department Order No. 10, Series of 1997) provides that: (d) In all cases of probationary employment, the employer shall make known to the employee the standards under which he will qualify as a regular employee at the time of his engagement. Where no standards are made known to the employee at that time, he shall be deemed a regular employee.

SC held yes: Middleby substantially notified petitioner of the standards to qualify as a regular employee when it apprised him, at the start of his employment, that it would evaluate his supervisory skills after five months.

o an employer is deemed to substantially comply with the rule on notification of standards if he apprises the employee that he will be subjected to a performance evaluation on a particular date after his hiring.

o SC agreed with the LA in saying that petitioner cannot claim that the respondent did not inform him of the standards, because it is clear in their agreement that after 5 mos his performance would be evaluated.

3 rd issue: WON petitioner was illegally dismissed when respondent opted not to renew his contract on the last day of his probationary employment. NO

SC: the dismissal cannot be deemed illegal. It is settled that even if probationary employees do not enjoy

permanent status, they are accorded the constitutional protection of security of tenure. This means they may only be terminated for just cause or when they otherwise fail to qualify as regular employees in accordance with reasonable standards made known to them by the employer at the time of their engagement.

But we have also ruled in Manlimos, et. al. vs. National Labor Relations Commission[15] that this constitutional protection ends on the expiration of the probationary period. On that date, the parties are free to either renew or terminate their contract of employment. Manlimos concluded that “(t)his development has rendered moot the question of whether there was a just cause for the dismissal of the petitioners xxx.”[16] In the case at bar, respondent Middleby exercised its option not to renew the contract when it informed petitioner on the last day of his probationary employment that it did not intend to grant him a regular status.

As found by the labor arbiter, the NLRC and the Court of Appeals, petitioner (1) incurred ten absences (2) was tardy several times (3) failed to wear the proper uniform many times and (4) showed inferior supervisory skills. Petitioner failed to satisfactorily refute these substantiated allegations. Taking all this in its entirety, respondent Middleby was clearly justified to end its employment relationship with petitioner.

8. CALS POULTRY SUPPLY CORPORATION and DANILO YAP, petitioners, vs. ALFREDO ROCO and CANDELARIA ROCO, respondents.

CA reversed NLRC, NLRC affirmed LA.

LA- dismissed the case of respondent for illegal dismissal.

CA- ruled in favor or respondents

Facts:

Petitioner - CALS Poultry Supply Corporation is engaged in the business of selling dressed chicken and other related products and managed by Danilo Yap.

Respondent/s: Alfredo Roco- was hired as driver and Edna Roco(sister) as helper in the dressing room of CALS both hired on March 15, 1984. Candelaria Roco, another sister, was hired on March 16, 1984 as helper, also at its chicken dressing plant on a probationary basis.

Mach 5, 1996- Alfredo and Candeleria filed a complaint for illegal dismissal against CALS and D. Yap. They allege that they were illegally dismissed on Jan 20, 1996 and November 5, 1996. They both claimed to be underpaid.

Edna also filed a complaint for illegal dismissal- she allege that that on June 26, 1996, she was reassigned to the task of washing dirty sacks and for this reason, in addition to her being transferred from night shift to day time duties, which she considered as management act of harassment, she did not report for work.

Alfredo- claimed that he was dismissed for refusing to accept the 30000 php offered to him by the lawyer of CALS, in exchange for his executing a letter of voluntary resignation.

Candelaria Roco- averred that she was terminated without cause from her job as helper after serving more than six (6) months as probationary employee.

Labor Arbiter in favor of petitioner- o Alfredo Roco’s case- Ruling: dismissed the complaint for

Illegal dismissal for lack of merit. Ground: he applied for leave of absence and was granted. He never returned for work. A notice to inquire was sent to him if he still has intention of resuming his work. He did not respond. he was not dismissed; it was he who unilaterally severed his relation with his employer.

o Candelaria’s case- Ruling: upheld CALS’ decision not to continue with her probationary employment having been found her unsuited for the work for which her services were engaged. She was hired on May 16, 1995 and her services were terminated on November 15, 1995.

o Edna Roco’s case- according to the Labor Arbiter, began absenting herself on June 25, 1996. She was sent a memo on July 1, 1996 requiring her to report for work immediately, but she did not respond.

NLRC affirmed LA- in favor of CALS

Court of Appeals: in favor of respondents. Alfredo and Candelaria to be reinstated etc. Except for EDNA she abandoned her work

CA: Alfredo and Candelaria was illegally dismissed.

Supreme Court: in favor of CALS (petitioner)

1. WON Alfredo was illegally dismissed. NO

Alfredo was not able to establish convincingly that he was dismissed. No notice of termination was given to him by CALS.

private respondent’s failure to work was due to the misunderstanding between the petitioner’s management and private respondent. As correctly observed by the Labor Arbiter, private respondent must have construed the October 28 incident as his dismissal so that he opted not to work for many days thereafter and instead filed a complaint for illegal dismissal. On the other hand, petitioner interpreted private respondent’s failure to report for work as an intentional abandonment. However, there was no intent to dismiss private respondent since the petitioner is willing to reinstate him. Nor was there an intent to abandon on the part of private respondent since he immediately filed a complaint for illegal dismissal soon after the October 28 incident. It would be illogical for private respondent to abandon his work and then immediately file an action seeking his reinstatement xxx. Under these circumstances, it is but fair that each party must bear his own loss, thus placing the parties on equal footing.

2. WON CANDELRIA’s termination of employment is within the probationary period of her employment. YES

Her employment was in a probationary basis. She was hired on May 16, 1995 and her services were terminated on

November 15, 1995 due to poor work performance. She did not measure up to the work standards on the dressing of chicken. The Labor Arbiter sustained CALS in terminating her employment. The NLRC affirmed the Labor Arbiter’s ruling.

She did not meet the required standards by the National Meat Inspection Commission. (dressing plants with Double “AA” Rating to which CALS’ employee were brief and with regard to)

We agree with CALS’ contention as upheld by both the Labor Arbiter and the NLRC that Candelaria’s services was terminated within and not beyond the 6-month probationary period.

The computation of the 6-month probationary period is reckoned from the date of appointment up to the same calendar date of the 6th month following.

9. MITSUBISHI MOTORSPHILIPPINES CORPORATION vs. CHRYSLER PHILIPPINESLABOR UNION and NELSON PARAS

FACTS:

Mistsubishi(MMPC, petitioner)- domestic corporation engaged in the assembly and distribution of Mitsubishi motor vehicles.

Chrysler Philippines Labor Union (CPLU, respondent)- legitimate labor organization and the duly certified bargaining agent of the hourly-paid regular rand and file employees of MMPC.

Nelson Paras(Respondent)- member of CPLU. His wife Cecile Paras, was the President of t he CP Salaried Employees Union (CPSU). Employment history:

o Nelson was first employed as shuttle bus driver on March 19, 1976. Resigned on June 16, 1982

o He worked at Saudi Arabia, 1982- 1993o He was re-hired as a welder- fabricator at the MMPC

tooling shop from Oct 3, 1994 – Oct 31,1994. On oct 29, 1994,his contract was renewed from Nov 1, 1994 up to march 3, 1995.

o May of 1996, he was re-hired on a probationary basis as a manufacturing trainee at the Plant Engineering Maintenance Department. They were given orientation of may 15, 1996 re: company’s standards for regularizating etc.

o On May 27, 1996 he started reporting for work. He was evaluated by his immediate supervisor after 6 months and received an average rating. He was informed by his immediate supervisor that based on his performance rating he would be regularized.

The managers reviewed and unanimously agreed with Paras’ immediate supervisors that Paras performance was unsatisfactory. Paras was not considered for regularization. (contradicting)

On November 26, 1996- paras received a notice of termination dated Nov 25,1996 for failure to meet the required company standards for regularization.

Grievance Machinery and Voluntary Arbitration: the dismissal of Paras was valid for failure to pass the probationary standards of MMPC. – VA in favor or Mistsubishi/ MMPC

The VA declared that hiring an employee on a probationary basis to determine his or her fitness for regular employment was in accord with the MMPC’s exercise of its management prerogative. The VA pointed out that MMPC had complied with the requirement of apprising Paras of the standards of performance evaluation and regularization at the inception of his probationary employment. The VA agreed with the MMPC that the termination of Paras’ employment was effected prior to the expiration of the six-month probationary period. As to Paras’ contention that he was already a regular employee before he was dismissed in 1994 considering that he had an accumulated service of eleven (11) months, the VA ruled that Paras’ delay in filing a complaint for regularization only in 1996, for services rendered in October 1994 to March 1995, militated against him. The VA stated that Paras’ dismissal was based on the unsatisfactory performance rating given to him by his direct supervisors Lito Lacambacal and Wilfredo Lopez. The VA also found that the alleged heated argument between Atty. Carlos S. Cao, the Labor Relations Manager of MMPC, and Cecille Paras, the President of CPSU, was irrelevant in the termination of Paras’ services.[15]

Court of Appeals- Paras and CPLU filed a petitioner for review under rule 45

OSG- his employment was terminated within the 6 months probationary period. Expiration Nov 27, 1996. The notice was served on Nov 25,1996. And that failure of Paras to get a satisfactory performance rating justified the termination. Inclusion of his 5 months contractual employment as welder fabricator did not qualify him for regular employment. Appointment of a probationary employee to a regular status is voluntary and discretionary on the part of the employer.

Ruling of CA- used the computation of Civil code, agreed with Paras and CPLU that 6 months is equivalent to 180 days, may 27, 1996 to November 23, 1996. Therefore when he received his notice on November 26, 1996, it was already on his 183rd day or after the expiration of the 6 months probationary period. Therefore he became a regular employee and he was illegally dismissed for non compliant of 2-notice requirement. CA ordered reinstatement.

Issues:

(a) whether or not respondent Paras was already a regular employee on November 26, 1996; YES

(b) whether or not he was legally dismissed; NO. he was Illegally dismissed

Held:

a. Regularization of employment – Yes already a regular employee

Indeed, an employer, in the exercise of its management prerogative, may hire an employee on a probationary basis in order to determine his fitness to perform work.[29] Under Article 281 of the Labor Code, the employer must inform the employee of the standards for which his employment may be considered for regularization. Such probationary period, unless covered by an apprenticeship agreement, shall not exceed six (6) months from the date the employee started working. The employee’s services may be terminated for just cause or for his failure to qualify as a regular employee based on reasonable standards made known to him.[30]

Respondent Paras was employed as a management trainee on a

probationary basis. During the orientation conducted on May 15, 1996, he was apprised of the standards upon which his regularization would be based. He reported for work on May 27, 1996. As per the company’s policy, the probationary period was from three (3) months to a maximum of six (6) months.

Applying Article 13 of the Civil Code, [31] the probationary period

of six (6) months consists of one hundred eighty (180) days.[32] This is in conformity with paragraph one, Article 13 of the Civil Code, which provides that the months which are not designated by their names shall be understood as consisting of thirty (30) days each. The number of months in the probationary period, six (6), should then be multiplied by the number of days within a month, thirty (30); hence, the period of one hundred eighty (180) days.

As clearly provided for in the last paragraph of Article 13, in

computing a period, the first day shall be excluded and the last day included. Thus, the one hundred eighty (180) days commenced on May 27, 1996, and ended on November 23, 1996. The termination letter dated November 25, 1996 was served on respondent Paras only at 3:00 a.m. of November 26, 1996. He was, by then, already a regular employee of the petitioner under Article 281 of the Labor Code

b. Legality of the Dismissal – the ground of his dismissal was not under the enumeration given by labor code

An employee cannot be dismissed except for just or authorized cause as found in the Labor Code and after due process. The following grounds would justify the dismissal of an employee: (a) Serious misconduct or willful disobedience by the employee of the lawful orders of the employer or 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 duly authorized representative; (d) Commission of a crime or offense by the employee against the person of his employer or of any immediate member of his family or his duly authorized representative; and (e) Other causes analogous to the foregoing.

The ground of his dismissal was alleged unsatisfactory rating arising from poor performance. The company has the burden of proof to prove the legality of the dismissal and the validity must be clearly established in a manner consistent with due process.

Under Article 282 of the Labor Code, an unsatisfactory rating can be a just cause for dismissal only if it amounts to gross and habitual neglect of duties. Gross negligence has been defined to be the want or absence of even slight care or diligence as to amount to a reckless disregard of the safety of person or property. Grossly negligent in the performance of his duties was not proved.

It was stated in their company policy that after the evaluation they must discussed the results with the employee and the department heads. There was no compliance with the company policy. At first the immediate supervisor of Paras informed him that he was average and that he will be regularize. However, in a complete turn around, the petitioner made it appear that after the performance evaluation of respondent Paras was reviewed by the department and division

heads, it was unanimously agreed that the respondent’s performance rating was unsatisfactory, making him unfit for regularization.

Considering that respondent Paras was not dismissed for a just or authorized cause, his dismissal from employment was illegal. Furthermore, the petitioner’s failure to inform him of any charges against him deprived him of due process. Clearly, the termination of his employment based on his alleged unsatisfactory performance rating was effected merely to cover up and “deodorize” the illegality of his dismissal.

c. Reinstatement and Backwages – there was retrenchment, the unafavorable financial conditions of the petitioner may not justify reinstatement. Paras is entitled to backwages.

10. GRANDTEQ INDUSTRIAL v ANNALIZA ESTRELLA

- Sometime in January 2004, Grandteq and Estrella entered into a Purchase/Assignment of Car Agreement, whereby the former undertook to purchase a car for Estrella, who would in turn refund the purchase price to Grandteq in 100 monthly installments. The agreement likewise stated that the "company shall retain the ownership of the car until the car loan is fully paid." To complement the terms of the agreement, Estrella executed a Promissory Note.

- When she defaulted in her payments Grandteq instructed her to leave the car in the office premisies (Sept. 15, 2004)

- Estrella failed to abide- Sept. 18, 2004, Grandteq sent her another memorandum requiring her

to explain he “insubordination”- In her reply memorandum, she asserted that she had already paid the

50,000 DP, and Grandteq has no valid cause to deman its surrender.- Estrella also filed a complaint for recovery of sales commissions,

allowances, and other benefits before the LA (Sept 17, 2004)- On Sept. 20, 2004 she filed for leave of absence and submitted a

medical certificate recommending that she go on rest for 3 weeks. - Grandteq denied the request, nonetheless, she still went on leave

effective Sept 22 – Oct 14.- On Oct 1, she tries to withdraw her salary but to her dismay it was not

remitted. - On Oct 4, 2004 she amended her complaint to include non-payment of

wages- On Oct 15 Estrella returned to work but the security guard refused her

entry upon order of the VP De Leon- Estrella thus amended her complaint to include illegal dismissal and

likewise demanded for moral damages and attorneys fees- Traversing the complaint, Grandteq averred that Estrella was validly

dismissed because:o she abandoned her job when she did not report for work

for three weeks despite the disapproval of her leave application;

o that she committed insubordination when she failed to obey an official order directing her to return a company vehicle;

o that she violated the confidence and trust reposed in her by the company when she negotiated in her personal capacity with a client, Philex Mining Corporation, at the time when she was allegedly sick; and

o that she failed to attend the administrative hearing initiated by the company on October 29, 2004;

o thus, Grandteq deemed her to have waived her right to be heard. Estrella was furnished with a Notice of Termination22

on November 12, 2004, indicating that she was being dismissed for gross and habitual neglect of duty and fraud or willful breach of trust. Grandteq denied any outstanding sales commissions or incentives due Estrella.23

- - La ruled in favor of Strella- NLRC ruled in favor of Gradteq, held that there was a valid cause for

dismissing Estrella- On appeal to CA, CA reinstated LA decision- A judicious review of the records discloses that Grandteq failed to

prove that Estrella was justifiably dismissed due to lack of trust and confidence and gross and habitual neglect of duty.

- Grandteq attributes loss of trust and confidence to the following acts:

(1) insubordination when Estrella disobeyed a company directive ordering her to return a company vehicle; and

(2) transacting, in her personal capacity, with a client of Grandteq.

- 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.

- Facts of the case do not show presence of the second requisite.- The failure to return the vehicle and the Purchase/Assignment of Car

Agreement, from which Grandteq derives its claim of ownership over the car, had no relation at all to the discharge of respondent’s duties as a sales engineer.

- There is likewise no basis for a finding of legitimate loss of confidence because Grandteq failed to show that Estrella held a position of trust and confidence

- Firm is the rule that loss of confidence as a just cause for termination of employment is premised on the fact that the employee concerned holds a position of trust and confidence, where greater trust is placed by management and from whom greater fidelity to duty is correspondingly expected. The betrayal of this trust is the essence of the offense for which an employee is penalized

- There was no showing that she betrayed the trust reposed to her or that she holds a position of trust and confidence.

- As to GROSS NEGLIGENCE, it connotes want of care in the performance of one's duties, while habitual neglect implies repeated failure to perform one's duties for a period of time, depending on the circumstances. The single or isolated act of negligence does not constitute a just cause for the dismissal of an employee.

- SC found no gross and habitual neglect in this case- As to ABANDONMENT, abandonment, as a just and valid ground for

termination, means the deliberate, unjustified refusal of an employee to resume his employment. For abandonment to be a valid ground for dismissal, two (2) elements must be proved:

o the intention of an employee to abandon, o coupled with an overt act from which it may be inferred

that the employee has no more intention to resume his work.

- Burden of proof is with the employer to show a clear and deliberate intent on the part of the employee to discontinue employment.

- Estrella’s actions after her absences negate an intent to abandon her job. Estrella’s application for sick leave, the Medical Certificate she secured, and the letter from her lawyer that she was going on sick leave and more importantly, her going back to the company premises on October 15, 2004 – all indicate her intention to resume work after the lapse of the period of her leave of absence. It would be the height of inequity and injustice to declare Estrella to have abandoned her job on the mere pretext that her sick leave application was not approved. Especially so that prior to her dismissal, she had no record of infraction of company rules for which she could have been sanctioned by either warning, reprimand or suspension. Besides, her filing of an illegal dismissal case clearly contradicts Grandteq’s allegation that she abandoned her job.40

- Employer has the burden of proof of establishing that the termination was based on a just cause.

- As t money claims, there is firther need to adduce evidence to establish the amout hence case was remanded to Labor Arbiter.

- As to liability of Officers. 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. True, solidary liabilities may at times be incurred but only when exceptional circumstances warrant such as, generally, in the following cases:

- 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.

-- nnns there is no indication that Estrella’s dismissal was effected with

malice or bad faith on the part of Grandteq’s officers. Their liability for Estrella’s illegal dismissal, the consequential monetary award arising from such dismissal and the other money claims awarded in the LA’s decision, as correctly affirmed by the CA, could thus only be joint, not solidary.

11. LORES REALTY ENTERPRISES INC v PACIA

- Pacia was hired as assistant manager and officer in charge of LREI’s accounting department under Finance Administrative Division.

- October 28, 1998, LREI’s acting general manager, petitioner Sumulong, through Ms. Julie Ontal, directed Pacia to prepare Check Voucher No. 16477 worth P150,000.00 as partial payment for LREI’s outstanding obligation to the Bank of the Philippine Islands-Family Bank (BPI-FB). Pacia did not immediately comply with the instruction. After two repeated directives, Pacia eventually prepared Check No. 0000737526 in the amount of P150,000.00. Later, Sumulong again directed Pacia to prepare Check Voucher No. 16478 in the amount of P175,000.00 to settle the balance of LREI’s outstanding indebtedness with BPI-FB. Pacia once again was slow in obeying the order. Due to the insistence of Sumulong, however, Pacia eventually prepared Check No. 0000737527 in the amount of P175,000.00.

- To explain her refusal to immediately follow the directive, Pacia reasoned out that the funds in LREI’s account were not sufficient to cover the amounts to be indicated in the checks.

- October 29, 1998, Sumulong issued a memorandum3 ordering Pacia to explain in writing why she refused to follow a clear and lawful directive.

- On the same day, Pacia replied in writing and explained that her initial refusal to prepare the checks was due to the unavailability of funds to cover the amounts and that she only wanted to protect LREI from liability under the Bouncing Checks Law.

- On November 6, 1998, Pacia received a notice of termination5 stating, among others, that she was being dismissed because of her willful disobedience and their loss of trust and confidence in her.

- Pacia then filed a Complaint for Unfair Labor Practice due to Harassment, Constructive Dismissal, Moral and Exemplary Damages6

against LREI and Sumulong. Subsequently, Pacia filed an Amended Complaint7 to include the charges of illegal dismissal and non-payment of salaries.

- the Labor Arbiter (LA) rendered a decision8 finding that the dismissal of Pacia was for a just and valid cause but ordering payment of what was due her.

- On appeal, the NLRC in its March 31, 2000 Decision9 reversed the LA’s Decision and found LREI and Sumulong guilty of illegal dismissal.

- On November 25, 2005, the CA found no merit in the petition and dismissed it.

- SC finds no merit in the petition.- ARTICLE 282. Termination by employer. – An employer may terminate

an employment for any of the following causes:

(a) Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or 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 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.

- Pacia’s initial reluctance to prepare the checks, however, which was seemingly an act of disrespect and defiance, was for honest and well intentioned reasons. Protecting LREI and Sumulong from liability under the Bouncing Checks Law18 was foremost in her mind. It was not wrongful or willful. Neither can it be considered an obstinate defiance of company authority. The Court takes into consideration that Pacia, despite her initial reluctance, eventually did prepare the checks on the same day she was tasked to do it.

- Pacia’s apprehension was justified when the check was dishonored. This clearly affirms her assertion that she was just being cautious and circumspect for the company’s sake. Thus, her actuation should not be construed as improper conduct.

- the Court is guided by the time-honored principle 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. The rule in controversies between a laborer and his master distinctly states that doubts reasonably arising from the evidence, or in the interpretation of agreements and writing, should be resolved in the former's favor.

12. SAMAHAN NG MGA MANGGAGAWA SA HYATT v VOLUNTARY ARBITRATOR MAGSALIN and HOTEL ENTERPRISES OF THE PHILS. INC.

- On January 31, 2001, Hyatt’s General Manager, David C. Pacey, issued a Memorandum5 informing all hotel employees that hotel security have been instructed to conduct a thorough bag inspection and body frisking in every entrance and exit of the hotel. He enjoined employees to comply therewith. Copies of the Memorandum were furnished petitioner.

- February 3, 2001, Angelito Caragdag, a waiter at the hotel’s Cafe Al Fresco restaurant and a director of the union, refused to be frisked by the security personnel. The incident was reported to the hotel’s Human Resources Department (HRD), which issued a Memorandum6

to Caragdag on February 5, 2001, requiring him to explain in writing within forty-eight (48) hours from notice why no disciplinary action should be taken against him. The following day, on February 6, 2001, Caragdag again refused to be frisked by the security personnel. Thus, on February 8, 2001, the HRD issued another Memorandum7 requiring him to explain.

- On February 14, 2001, the HRD imposed on Caragdag the penalty of reprimand for the February 3, 2001 incident, which was considered a first offense, and suspended him for three days for the February 6, 2001 incident, which was considered as a second offense.8 Both penalties were in accordance with the hotel’s Code of Discipline.

- February 22, 2001, when Mike Moral, the manager of Hyatt’s Cafe Al Fresco and Caragdag’s immediate superior, was about to counsel two staff members, Larry Lacambacal and Allan Alvaro, at the training room, Caragdag suddenly opened the door and yelled at the two with an enraged look. In a disturbing voice he said, "Ang titigas talaga ng ulo n’yo. Sinabi ko na sa inyo na huwag kayong makikipagusap sa management habang ongoing pa ang kaso!" (You are very stubborn. I told you not to speak to management while the case is ongoing!) Moral asked Caragdag what the problem was and informed him that he was simply talking to his staff. Moral also told Caragdag that he did not have the right to interrupt and intimidate him during his counseling session with his staff.

- February 23, 2001, Moral issued a Memorandum9 requiring Caragdag to explain his actions in the training room. Caragdag submitted his written explanation on February 25, 200110 narrating that he was informed by someone that Lacambacal and Alvaro were requesting for his assistance because Moral had invited them to the training room. Believing that he should advise the two that they should be accompanied by a union officer to any inquisition, he went to the training room. However, before he could enter the door, Moral blocked him. Thus, he told Lacambacal and Alvaro that they should be assisted by a union representative before giving any statement to management. Caragdag also prayed that Moral be investigated for harassing union officers and union members.

- February 28, 2001, Moral found the explanations unsatisfactory. In a Memorandum11 issued on the same date, Moral held Caragdag liable for Offenses Subject to Disciplinary Action (OSDA) 3.01 of the hotel’s Code of Discipline, i.e., "threatening, intimidating, coercing, and provoking to a fight your superior for reasons directly connected with his discharge of official duty." Thus, Caragdag was imposed the penalty of seven days suspension in accordance with the hotel’s Code of Discipline.

- March 2, 2001, Caragdag committed another infraction. At 9:35 a.m. on the said date, Caragdag left his work assignment during official hours without prior permission from his Department Head. He was required to submit an explanation, but the explanation12 he submitted was found unsatisfactory. On March 17, 2001, Moral found Caragdag liable for violating OSDA 3.07, i.e., "leaving work assignment during official working hours without prior permission from the department head or immediate superior," and suspended him for three days.

- Because of the succession of infractions he committed, the HRD also required Caragdag to explain on May 11, 2001 why the hotel’s OSDA 4.32 (Committing offenses which are penalized with three [3] suspensions during a 12-month period) should not be enforced against him.14 An investigation board was formed after receipt of Caragdag’s written explanation, and the matter was set for hearing on May 19, 2001. However, despite notice of the scheduled hearing, both Caragdag and the Union President failed to attend. Thereafter, the investigating board resolved on the said date to dismiss Caragdag for violation of OSDA 4.32.15 Caragdag appealed but the investigating board affirmed its resolution after hearing on May 24, 2001.

- June 1, 2001, the hotel, through Atty. Juancho A. Baltazar, sent Caragdag a Notice of Dismissal

- Caragdag’s dismissal was questioned by petitioner, and the dispute was referred to voluntary arbitration upon agreement of the parties.

- VA ruled that all the actions of HYATT were in accordance with law but granted financial assiatnce in the maount of 100,000

- Petitioner assailed the decision through an appeal before the CA thorugh a petition for certiorari which was outrightly dismissed being an improper remedy.

- Rule 43 is the proper remedy and should be filed within the 15-day reglementary period.

- They filed another petition for review of Vas order based on grave abuse of discretion.

- CA rendered decision deleting the award for financial assistance and affirming VA decision.

- SC held that proper recourse for appeal from judgment of VA is via rule 43

- As to financial assistance/severance pay, SC held that: separation pay shall be allowed as a measure of social justice only in those instances

where the employee is validly dismissed for causes other than serious misconduct or those reflecting on his moral character. Where the reason for the valid dismissal is, for example, habitual intoxication or an offense involving moral turpitude, like theft or illicit sexual relations with a fellow worker, the employer may not be required to give the dismissed employee separation pay, or financial assistance, or whatever other name it is called, on the ground of social justice.

- The policy of social justice is not intended to countenance wrongdoing simply because it is committed by the underprivileged. At best it may mitigate the penalty but it certainly will not condone the offense. Compassion for the poor is an imperative of every humane society but only when the recipient is not a rascal claiming an undeserved privilege.

- Caragdag’s dismissal was due to several instances of willful disobedience to the reasonable rules and regulations prescribed by his employer. The Voluntary Arbitrator pointed out that according to the hotel’s Code of Discipline, an employee who commits three different acts of misconduct within a twelve (12)-month period commits serious misconduct. He stressed that Caragdag’s infractions were not even spread in a period of twelve (12) months, but rather in a period of a little over a month. Records show the various violations of the hotel’s rules and regulations were committed by Caragdag.

o He was suspended for violating the hotel policy on bag inspection and body frisking.

o He was likewise suspended for threatening and intimidating a superior while the latter was counseling his staff.

o He was again suspended for leaving his work assignment without permission.

- Evidently, Caragdag’s acts constitute serious misconduct.- Caragdag’s dismissal being due to serious misconduct, it follows that

he should not be entitled to financial assistance. To rule otherwise would be to reward him for the grave misconduct he committed. We must emphasize that social justice is extended only to those who deserve its compassion

- Petition denied, CA decision affirmed.

13. JERRY MAPILI vs. PHILIPPINE RABBIT BUS LINES, INC./NATIVIDAD NISCE

G.R. No. 172506, July 27, 2011

Facts:

Respondent Nisce, President of PRBLI, an entity engaged in the transportation business hired petitioner as bus conductor. However while on duty, petitioner was caught by PRBLI’s field inspector extending a free ride to a lady passenger. Upon order of the field inspector, the lady passenger, who happened to be the wife of Julio Ricardo, petitioner’s co-employee and one of PRBLI’s drivers, was immediately issued a passenger ticket for which she paid P50.00.

Because of the incident, petitioner was preventively suspended and was directed to appear in an administrative investigation. A formal hearing was conducted in which he was given an opportunity to present and explain his side. Consequently, through a memorandum, petitioner was terminated from employment for committing a serious irregularity by extending a free ride to a passenger in violation of company rules. Notably, that was already the third time that petitioner committed said violation.

Petitioner alleged that his two previous violations of the same company regulation cannot be considered in the imposition of the penalty of dismissal since those previous infractions were not too serious. The first involved a police officer supposedly on official duty who refused to pay for a passenger ticket, while the second involved a former employee of PRBLI who misrepresented himself to be a current employee by virtue of a company ID duly presented. Moreover, he has already been penalized for these previous violations and to consider them anew would be tantamount to penalizing him twice for the same offense.

LA held that petitioner had no intention to defraud the company by his failure to issue a ticket to the wife of a co-employee as the same was done out of gratitude and under the wrong impression that she is entitled to such privilege.

The NLRC set aside the findings of the LA.

CA affirmed the decision of the NLRC.

Issues:

Whether or not the petitioner has been validly dismissed from employment because of repeated infractions.

Ruling:

Yes. Petitioner’s violation of company rules was intentional, willful, serious and a just cause for dismissal. The provision of Section 13, Article VIII of the CBA is clear and unequivocal that free rides are available only to employees of PRBLI. The benefit is not automatically extended to members of the employee’s immediate family as passes must first be requested for them. Petitioner should be conversant of this provision considering his previous infractions of this same provision for which he was duly penalized. Besides, petitioner’s claim of good faith is belied by his testimony to the effect that he extended a free ride out of gratitude to the wife of a co-employee who assisted him in his financial troubles. There was deliberate intent on the part of the petitioner to commit the violation in order to repay a personal debt at the expense of the company. Petitioner chose to violate company rules for his benefit without regard to his responsibilities to the company. Also, if not for the inspector who discovered the incident, the company would have been defrauded by the amount of fare. Moreover, since the petitioner has been employed for more than 8 years, he ought to know the specific company rules pertaining to his line of work as a bus conductor. His length of service has even aggravated the resulting consequences of his transgressions. Also as a bus conductor whose duties primarily include the collection of transportation fares, which is the lifeblood of the PRBLI, petitioner should have exercised the required diligence in the performance thereof. His position is imbued with trust and confidence because it involves handling of money and failure to collect the proper fare from the riding public constitutes a grave offense which justifies his dismissal. Moreover, petitioner’s "series of irregularities when put together may constitute serious misconduct."

Petitioner’s record of offenses of the same nature as his present infraction justifies his dismissal. As petitioner’s employment record shows, this is not the first time that petitioner refused to collect fares from passengers. In fact, this is already the third instance that he failed to collect fares from the riding public. Although petitioner already suffered the corresponding penalties for his past misconduct, those infractions are still relevant and may be considered in assessing his liability for his present infraction. We thus held in Philippine Rabbit Bus Lines, Inc. v. National Labor Relations Commission that:

Nor can it be plausibly argued that because the offenses were already given the appropriate sanctions, they cannot be taken against him. They are relevant in assessing private respondent’s liability for the present violation for the purpose of determining the appropriate penalty. To sustain private respondent’s argument that the past violation should not be considered is to disregard the warnings previously issued to him.

14. CAVITE APPAREL, INCORPORATED and ADRIANO TIMOTEO vs. MICHELLE MARQUEZ

G.R. No. 172044, February 06, 2013

Facts:

Cavite Apparel is a domestic corporation engaged in the manufacture of garments for export. Michelle was hired as a regular employee in its Finishing Department. She enjoyed, among other benefits, vacation and sick leaves of seven (7) days each per annum. Prior to her dismissal, Michelle committed the following infractions (with their corresponding penalties):

a. First Offense: Absence without leave (AWOL) on December 6, 1999 – written warning

b. Second Offense: AWOL on January 12, 2000 – stern warning with three (3) days suspension

c. Third Offense: AWOL on April 27, 2000 – suspension for six (6) days.

Michelle got sick and did not report for work. When she returned, she submitted a medical certificate. Cavite Apparel, however, denied receipt of the certificate. Michelle did not report for work on May 15-27, 2000 due to illness. When she reported back to work, she submitted the necessary medical certificates. Nonetheless, Cavite Apparel suspended Michelle for six (6) days (June 1-7, 2000). When Michelle returned on June 8, 2000, Cavite Apparel terminated her employment for habitual absenteeism.

LA dismissed the complaint filed by Michelle for illegal dismissal.

NLRC reversed the decision of LA Ramos and concluded that Michelle had been illegally dismissed.

CA found no grave abuse of discretion on the part of the NLRC and accordingly dismissed Cavite Apparel’s petition.

Issue:

Whether or not Michelle has been validly dismissed from employment based on totality of infractions.

Held:

No. Michelle’s four absences were not habitual; "totality of infractions" doctrine not applicable. Neglect of duty, to be a ground for dismissal under Article 282 of the Labor Code, must be both gross and habitual. Gross negligence implies want of care in the performance of one’s duties. Habitual neglect imparts repeated failure to perform one’s duties for a period of time, depending on the circumstances. Under these standards and the circumstances obtaining in the case, we agree with the CA that Michelle is not guilty of gross and habitual neglect of duties.

Michelle’s penalty of dismissal too harsh or not proportionate to the infractions she commited. The court held that "[e]ven when there exist some rules agreed upon between the employer and employee on the subject of dismissal, x x x the same cannot preclude the State from inquiring on whether [their] rigid application would work too harshly on the employee." This Court will not hesitate to disregard a penalty that is manifestly disproportionate to the infraction committed. Michelle might have been guilty of violating company rules on leaves of absence and employee discipline, still we find the penalty of dismissal imposed on her unjustified under the circumstances. As earlier mentioned, Michelle had been in Cavite Apparel’s employ for six years, with no derogatory record other than the four absences without official leave in question, not to mention that she had already been penalized for the first three absences, the most serious penalty being a six-day suspension for her third absence on April 27, 2000.

While previous infractions may be used to support an employee’s dismissal from work in connection with a subsequent similar offense, we cautioned employers in an earlier case that although they enjoy a wide latitude of discretion in the formulation of work-related policies, rules and regulations, their directives and the implementation of their policies must be fair and reasonable; at the very least, penalties must be commensurate to the offense involved and to the degree of the infraction.

Finally, we find no evidence supporting Cavite Apparel’s claim that Michelle’s absences prejudiced its operations; there is no indication in the records of any damage it sustained because of Michelle’s absences. Also, we are not convinced that allowing Michelle to remain in employment even after her fourth absence or the imposition of a lighter penalty would result in a breakdown of discipline in the employee ranks.

In fine, we hold that Cavite Apparel failed to discharge the burden of proving that Michelle’s dismissal was for a lawful cause. We, therefore, find her to have been illegally dismissed.

15. E.G & I. CONSTRUCTION CORPORATION and Sato, et al, G.R. No. 182070

February 16, 2011

Facts:

Sato was hired by petitioner as a grader operator, which is considered as technical labor for more than thirteen (13) years. However, Sato discovered that petitioner corporation had not been remitting his premium contributions to the Social Security System (SSS). When Sato kept on telling petitioners to update his premium contributions, he was removed as a grader operator and made to perform manual labor, such as tilling the land in a private cemetery and/or digging earthworks in petitioner corporation’s construction projects. An inspection team from the SSS went to petitioner corporation’s office to check its compliance with the SSS law. Consequently, petitioners told Sato that they could no longer afford to pay his wages, and he was advised to look for employment in other construction companies. Sato, however, found difficulty in finding a job because he had been blacklisted in other construction companies and was prevented from entering the project sites of petitioners.

On the other hand, Berdin, Parantar, and Lacida were hired by petitioners as a steelman/laborer, steelman, and laborer respectively. At the start of their employment, they were required to sign several documents purporting to be employment contracts to which they immediately signed without verifying their contents for fear of forfeiting their employment. However in 2004, when the project engineer instructed them to affix their signatures on various documents, they refused to sign the same because they were written in English, a language that they did not understand. Irked by their disobedience, the project engineer terminated their employment.

Respondents then filed their respective complaints for illegal dismissal, underpayment of wages (wage differentials), holiday pay, thirteenth (13th) month pay, and service incentive leave pay.

Petitioners alleged that respondents abandoned their work when they failed to report for work starting on July 22, 2004. Petitioner corporation sent letters advising respondents to report for work, but they refused. They also maintained that respondents are still welcome, if they desire to work.

As to respondent Sato, petitioner corporation alleged that it admonished respondent for having an illicit affair with another woman; that, in retaliation, Sato complained to the SSS for alleged non-remittance of his premium contributions; that Sato’s work was substandard; and that he also incurred unexplained absences and was constantly reprimanded for habitual tardiness.

LA rendered decision finding that the respondents were illegally dismissed from employment.

NLRC reversed the decision of the LA.

CA affirmed the decision of the LA.

Issue:

Whether or not respondents has been validly dismissed from employment on the ground of abandonment of duty.

Held:

No. Petitioner corporation failed to prove that respondents were dismissed for just or authorized cause. In an illegal dismissal case, the onus probandi rests on the employer to prove that the dismissal of an employee is for a valid cause. For abandonment to exist, it is essential (a) that the employee must have failed to report for work or must have been absent without valid or justifiable reason; and (b) that there must have been a clear intention to sever the employer-employee relationship manifested by some overt acts. The employer has the burden of proof to show the employee's deliberate and unjustified refusal to resume his employment without any intention of returning. Mere absence is not sufficient. There must be an unequivocal intent on the part of the employee to discontinue his employment.

In this case, petitioner corporation claims that respondent Sato committed unexplained absences on May 20, 24, and 25, 2004 and on June 7, 18, and 23, 2004. However, based on the findings of fact of the CA, respondent Sato worked on May 20, June 18 and 23, 2004. This was based on the weekly time record and payroll of respondent Sato that were presented by petitioner corporation in its appeal before the NLRC. On respondent Sato’s alleged absences on May 24 and 25 and on June 7, 2004, no time record and payroll documents were presented by petitioner corporation. With regard to respondents Berdin, Lacida, and Parantar, petitioner corporation alleges that they failed to report for work starting on July 22, 2004, and that petitioner even sent them letters advising them to report for work, but to no avail.

The reason why respondents failed to report for work was because petitioner corporation barred them from entering its construction sites. It is a

settled rule that failure to report for work after a notice to return to work has been served does not necessarily constitute abandonment. The intent to discontinue the employment must be shown by clear proof that it was deliberate and unjustified. Petitioner corporation failed to show overt acts committed by respondents from which it may be deduced that they had no more intention to work. Respondents’ filing of the case for illegal dismissal barely four (4) days from their alleged abandonment is totally inconsistent with our known concept of what constitutes abandonment.

16. Hospital Management Services, Inc. - Medical Center Manila, vs. Hospital Management Services, Inc. - Medical Center Manila Employees Association

G.R. No. 176287 January 31, 2011

FACTS:

Respondent De Castro started working as a staff nurse at petitioner hospital since September 28, 1990, until she was dismissed on July 20, 1999

Rufina Causaren, an 81-year-old patient confined at Room 724-1 of petitioner hospital for "gangrenous wound on her right anterior leg and right forefoot" and scheduled for operation, fell from the right side of the bed as she was trying to reach for the bedpan.

Instead of personally seeing the patient, respondent De Castro directed ward-clerk orientee Guillergan to check the patient. The vital signs of the patient were normal.

The legal counsel of petitioner hospital directed respondent De Castro and three other nurses on duty, Staff Nurse Janith V. Paderes and Nursing Assistants Marilou Respicio and Bertilla T. Tatad, to appear before the Investigation Committee at the conference room of petitioner hospital.

HRD Officer of petitioner hospital issued a notice of termination, duly noted by Dr. Abaya-Morido, upon respondent De Castro, effective at the close of office hours of July 20, 1999, for alleged violation of company rules and regulations, particularly paragraph 16 (a), Item 3, Chapter XI of the Employee's Handbook and Policy Manual of 1996 (Employee's Handbook):

(1) negligence to follow company policy on what to do with patient Rufina Causaren who fell from a hospital bed; (2) failure to record and refer the incident to the physician-[on- duty and] allow[ing] a significant lapse of time before reporting the incident; (3) deliberately instructing the staff to follow her version of the incident in order to cover up the lapse; and (4) negligence and carelessness in carrying out her duty as staff nurse-on-duty when the incident happened.

De Castro filed a Complaint for illegal dismissal against petitioners.LA decision: Hospital to reinstate respondent De Castro to her former position or by payroll reinstatement.

NLRC decision: Reversed the findings of the LA and dismissing the complaint against the petitioners.

CA decision: Reversed and set aside the Decision of the NLRC and reinstated the Decision of the LA, with modification.

ISSUE:

WON the failure of De Castro to attend to patient Causaren after the latter fell from the bed constitutes gross negligence

HELD:

Article 282 (b) of the Labor Code provides that an employer may terminate an employment for gross and habitual neglect by the employee of his duties. The CA ruled that per the Employee’s Handbook of petitioner hospital, respondent De Castro’s infraction is classified as a less serious offense for "commission of negligent acts during working time" as set forth in subparagraph 11, paragraph 3 (B) of Chapter XI10 thereof. Petitioners anchor respondent De Castro’s termination of employment on the ground of serious misconduct for failure to personally attend to patient Causaren who fell from the bed as she was trying to reach for the bedpan. Based on her evaluation of the situation, respondent De Castro saw no necessity to record in the chart of patient Causaren the fact that she fell from the bed as the patient did not suffer any injury and her vital signs were normal. She surmised that the incident was not of a magnitude that would require medical intervention as even the patient and her niece did not press charges against her by reason of the subject incident.

Neglect of duty, to be a ground for dismissal, must be both gross and habitual. Gross negligence connotes want of care in the performance of one's duties. Habitual neglect implies repeated failure to perform one's duties for a period of time, depending upon the circumstances. A single or isolated act of negligence does not constitute a just cause for the dismissal of the employee. Despite our finding of culpability

against respondent De Castro; however, we do not see any wrongful intent, deliberate refusal, or bad faith on her part when, instead of personally attending to patient Causaren, she requested Nursing Assistant Tatad and ward-clerk orientee Guillergan to see the patient, as she was then attending to a newly-admitted patient at Room 710. It was her judgment call, albeit an error of judgment, being the staff nurse with presumably more work experience and better learning curve, to send Nursing Assistant Tatad and ward-clerk orientee Guillergan to check on the health condition of the patient, as she deemed it best, under the given situation, to attend to a newly-admitted patient who had more concerns that needed to be addressed accordingly. Being her first offense, respondent De Castro cannot be said to be grossly negligent so as to justify her termination of employment. Moreover, petitioners’ allegation, that respondent De Castro exerted undue pressure upon her co-nurses to alter the actual time of the incident so as to exculpate her from any liability, was not clearly substantiated.

Considering that this was the first offense of respondent De Castro in her nine (9) years of employment with petitioner hospital as a staff nurse without any previous derogatory record and, further, as her lapse was not characterized by any wrongful motive or deceitful conduct, the Court deems it appropriate that, instead of the harsh penalty of dismissal, she would be suspended for a period of six (6) months without pay, inclusive of the suspension for a period of 14 days which she had earlier served.

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17. Nissan Motors Phils., Inc. vs AngeloG.R. No. 164181, September 14, 2011

FACTS:

Respondent Victorino Angelo was employed by Nissan on March 11, 1989 as one of its payroll staff. On April 7 to 17, 2000, respondent was on sick leave, thus, he was not able to prepare the payroll for the said period. Again, on April 27 and 28, 2000, respondent was on an approved vacation leave which again resulted in the non-preparation of the payroll for that particular period.

On May 8, 2000, respondent received a Memorandum from the petitioner to inform him that the Company is considering his dismissal from employment on the grounds of serious misconduct, willful disobedience and gross neglect of duties.

1. On April 11, Tuesday, you did not report for work, without any notice to the company

2. On April 12, Wednesday, you reported for work but went home early claiming that you were again not feeling well.

3. On April 13, Thursday, you again did not report for work without any notice to the company just like what you did last Tuesday

4. On April 14, Friday (payday), we were still doing the payroll thru IT because we could not contact you. The amount released to the employees were not accurate as some got more than (sic), while some got less than what they were supposed to receive.

5. On April 18, Tuesday, you filed an application for vacation leave due to your son's graduation on April 27 and 28. Because it is again payroll time, we advised that your leave will be approved on the condition that you will ensure that the payroll is finished on time and [you] will make a proper turn over to your immediate superior before your leave. You agreed and your leave was approved.

6. On April 24 & 25 & 26, you were reminded on finishing the payroll and the turn over again and you said yes.

7. On April 27, Thursday, you were already on leave and your superior, Mr. M. Panela, found out that the diskette only contained the amount and name of employees, but not the account number.

8. On April 28, Friday, after exhaustive joint efforts done by Welfare Management Section and IT Division, we were able to finally release the payroll thru the bank, but many employees got lower amount than what they have expected, as in fact at least 43 employees out of 360 got salaries below P1,000.00, among them about 10 people got no salary primarily due to wrong deduction and computation done by you. Again, many people got angry to the management's inefficient handling of their payroll.

9. On May 2, Tuesday, you did not report for work, again you said you are not feeling well, but the information to us came very late at about noon

time.10. On May 3, Wednesday, you reported for work,

and was instructed to finish the payslips for the payroll periods April 15 and April 30. Later, you decided on your own to just compute the payslip on a monthly basis instead of the usual semi-monthly basis as is the customary thing to do. As a result thereof, an error in the tax withholding happened and again resulted in another confusion and anger among employees.

As a consequence of all these, the manufacturing employees, numbering about 350 people or about 65% of [Nissan's total population], since April 16, have started to decline rendering overtime work, saying after their 15 days of work they received only less than P200 while some even received only P80.

Petitioner conducted an investigation and concluded that respondent's explanation was untrue and insufficient. Thus, petitioner issued a Notice of Termination.

LA decision: Dismissed respondent's complaint for lack of merit

NLRC decision: Dismissed the appeal and affirmed the LA’s Decision.

CA decision: Petition was granted.

ISSUE:WON the Angelo’s non-preparation of payroll during the specific period amounts to serious misconducts and insubordination warranting dismissal

HELD: One of the just causes enumerated in the Labor Code is serious

misconduct. Misconduct is improper or wrong conduct. It is the transgression of some established and definite rule of action, a forbidden act, a dereliction of duty, willful in character, and implies wrongful intent and not mere error in judgment. Such misconduct, however serious, must nevertheless be in connection with the employee's work to constitute just cause for his separation. Thus, for misconduct or improper behavior to be a just cause for dismissal, (a) it must be serious; (b) it must relate to the performance of the employee’s duties; and (c) it must show that the employee has become unfit to continue working for the employer.

The Court found evidence to support the allegation of serious misconduct or insubordination. Petitioner claims that the language used by respondent in his Letter-Explanation is akin to a manifest refusal to cooperate with company officers, and resorted to conduct which smacks of outright disrespect and willful defiance of authority or insubordination. The misconduct to be serious within the meaning of the Labor Code must be of such a grave and aggravated character and not merely trivial or unimportant. The Letter-Explanation partly reads:

Again, it's not negligence on my part and I'm not alone to be blamed. It's negligence on your part [Perla Go] and A.A. Del Rosario kasi, noong pang April 1999 ay alam ninyo na hindi ako ang dapat may responsibilidad ng payroll kundi ang Section Head eh bakit hindi ninyo pinahawak sa Section Head noon pa. Pati kaming dalawa sa payroll, kasama ko si Thelma. Tinanggal nyo si Thelma. Hindi nyo ba naisip na kailangan dalawa ang tao sa payroll para pag absent ang isa ay may gagawa. Dapat noon nyo pa naisip iyan. Ang tagal kong gumawa ng trabahong hindi ko naman dapat ginagawa.

This Court finds the above to be grossly discourteous in content and tenor. The most appropriate thing he could have done was simply to state his facts without resorting to such strong language. Past decisions of this Court have been one in ruling that accusatory and inflammatory language used by an employee to the employer or superior can be a ground for dismissal or termination.

Another just cause cited by the petitioner is willful disobedience. One of the fundamental duties of an employee is to obey all reasonable rules, orders and instructions of the employer. Disobedience, to be a just cause for termination, must be willful or intentional, willfulness being characterized by a wrongful and perverse mental attitude rendering the employee’s act inconsistent with proper subordination. A willful or intentional disobedience of such rule, order or instruction justifies dismissal only where such rule, order or instruction is (1) reasonable and lawful, (2) sufficiently known to the employee, and (3) connected with the duties which the employee has been engaged to discharge.

Petitioner also dismissed respondent because of gross or habitual negligence. Neglect of duty, to be a ground for dismissal, must be both gross and habitual. In finding that petitioner was able to adduce evidence that would justify its dismissal of respondent, the NLRC correctly ruled that the latter's failure to turn over his functions to someone capable of performing the vital tasks which he could not effectively perform or undertake because of his heart ailment or condition constitutes gross neglect.

However, although the dismissal was legal, respondent is still entitled

to a separation pay as a measure of financial assistance, considering his length of service and his poor physical condition which was one of the reasons he filed a leave of absence.

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18. Lopez vs Keppel Bank Philippines

G.R. No. 176800, September 5, 2011

FACTS: Petitioner Elmer Lopez was the Branch Manager of the respondent

Keppel Bank Philippines, Inc. (bank) in Iloilo City. Allegedly, through his efforts, Hertz Exclusive Cars, Inc. (Hertz) became a client of the bank.

By notice dated August 12, 2003, the bank asked Lopez to explain in writing why he should not be disciplined for issuing, without authority, two purchase orders (POs) for the Hertz account amounting to a total of P6,493,000.00, representing the purchase price of 13 Suzuki Bravo and two Nissan Exalta vehicles.

Lopez alleged before the labor arbiter that he issued the POs as part of his strategy to enhance the bank’s business, in line with his duty as branch manager to promote the growth of the bank. He claimed that the bank honored the first PO for P1.8M from which the bank derived an income of P142,000.00. He added that the second PO did not materialize because Mr. James Puyat Concepcion, a Hertz incorporator and director who opened the Hertz account, stopped depositing with the bank because of the negative credit rating he received from the bank’s credit committee. Allegedly, the committee discovered that James Puyat Concepcion had several pending court cases.

For its part, the bank denied approving the first PO, arguing that Lopez did not have the authority to issue the POs for the Hertz account as there was a standing advice that no Hertz loan application was to be approved. It stressed that Lopez committed a serious violation of company rules when he issued the POs.

LA decision: Lopez was illegally dismissed.

NLRC decision: The NLRC found merit in the bank’s submission that by issuing the questioned POs without authority and against the bank’s express orders, Lopez thereby committed a willful disobedience against his superiors — a sufficient basis for the bank to lose its trust and confidence in him as branch manager. It thus found that Lopez had been dismissed for cause after the observance of due process.

CA decision: It fully agreed with the NLRC finding that Lopez had not been illegally dismissed.

ISSUE:WON Lopez is liable for loss of trust and confidence for issuing the two disputed POsHELD:

The right of an employer to freely select or discharge his employee is a recognized prerogative of management; an employer cannot be compelled to continue employing one who has been guilty of acts inimical to its interests. When this happens, the employer can dismiss the employee for loss of confidence.

Loss of confidence should ideally apply only (1) to cases involving employees occupying positions of trust and confidence, or (2) to situations where the employee is routinely charged with the care and custody of the employer’s money or property. To the first class belong managerial employees, i.e., those vested with the powers and prerogatives to lay down management polices and/or to hire, transfer, suspend, lay-off, recall, discharge, assign or discipline employees, or effectively recommend such managerial actions. To the second class belong cashiers, auditors, property custodians, or those who, in the normal and routine exercise of their functions, regularly handle significant amounts of money or property.

Despite evidence of his past exercise of authority (as found by the labor arbiter), we cannot disregard evidence showing that in August 2003, the bank specifically instructed Lopez not to proceed with the Hertz loan application because of the negative credit rating issued by the bank’s credit committee. We find it undisputed that Lopez processed the loan despite the adverse credit rating. In fact, he admitted that he overlooked the “control aspects” of the transaction as far as the bank was concerned because of his eagerness to get a bigger share of the market.

As a bank official, the petitioner must have been aware that it is basic

in every sound management that people under one’s supervision and direction are bound to follow instructions or to inform their superior of what is going on in their respective areas of concern, especially regarding matters of vital interest to the enterprise. Under these facts, we find it undisputed that Lopez disobeyed the bank’s directive to put the Hertz loan application on hold, and did not wait until its negative credit rating was cleared before proceeding to act. That he might have been proven right is immaterial.

Under the circumstances of this case, we are convinced that the bank was justified in terminating Lopez’s employment by reason of loss of trust and confidence.

19

G.R. No. 169260 March 23, 2011

SANDEN AIRCON PHILIPPINES and ANTONIO ANG, Petitioners, vs.LORESSA P. ROSALES, Respondent.

DEL CASTILLO, J.:

Principle - An employer has the discretion to dismiss an employee for loss of trust and confidence but the former may not use the same to cloak an illegal dismissal.

Facts

August 1992 - Sanden Aircon Philippines (Sanden) employed Loressa as Management Information System (MIS) Department Secretary.

December 26, 1996, she was promoted as Data Custodian and Coordinator. Loressa had access to all computer programs and marketing computer data, including the Delivery Receipt Transaction files.

May 16, 1997, Sanden discovered that the marketing delivery receipt transactions computer files were missing.

Technical investigation was conducted. Findings:

-Before the incident, Marketing Staff are still using the said file until 12:00 noon, when they were instructed by the Data Custodian (Ms. Loressa Rosales) to log out from the system because a back-up was to be conducted. Back-up activities never took place

-The incident can only happen when only one user [was] using the file and found out that Loressa was the only one log[ged] in on the system at 12:05 noon to 12:21 noon with 16 minutes of usage time

-The Data Custodian [has] all the rights of Add, Edit, Delete on all the files found in the system.

-It is highly probable that Ms. Loressa Rosales was the culprit in the said incident.

Loressa was charged of data sabotage and AWOL. She was given 24 hours to explain.

Loressa denied the allegations of data sabotage. According to her, only a computer programmer equipped with the necessary expertise and not a mere data custodian like her would be capable of such an act.

Sanden notified Loressa that management is terminating Loressa’s employment effective upon receipt of the said communication. The reason cited by Sanden was the loss of trust on her capability to continue as its Coordinator and Data Custodian. Loressa caused the deliberate sabotage of the marketing data involving the Delivery Receipts.

September 9, 1997, Loressa filed a complaint12 for illegal dismissal

Ruling of the Labor Arbiter

Sanden is guilty of illegal dismissal. There exists no justifiable basis for Sanden’s act of terminating the services of Loressa. Nowhere in the records can be found evidence, documentary or otherwise (i) that will directly point to Loressa’s having committed "data sabotage" or (ii) that she absented herself without leave.

Ruling of the National Labor Relations Commission

Affirmed then reversed, dismissed for lack of merit

Ruling of the Court of Appeals

CA granted the petition and reversed and set aside Resolution of the NLRC

Issue: whether Sanden legally terminated Loressa’s employment on the ground of willful breach of trust and confidence as Coordinator and Data Custodian.

Ruling: petition is bereft of merit.

ART. 282. TERMINATION BY EMPLOYER. – An employer may terminate an employment for any of the following causes:

(a) Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or 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 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.

Article 282(c) of the Labor Code prescribes two separate and distinct grounds for termination of employment, namely: (1) fraud or (2) willful breach by the employee of the trust reposed in him by his employer or duly authorized representative.

Breach of trust must be willful. Ordinary breach will not suffice. "A breach is willful if it is done intentionally and knowingly without any justifiable excuse, as distinguished from an act done carelessly, thoughtlessly or inadvertently."

"As firmly entrenched in our jurisprudence, loss of trust and confidence as a just cause for termination of employment is premised on the fact that an employee concerned holds a position where greater trust is placed by management and from whom greater fidelity to duty is correspondingly expected.""The betrayal of this trust is the essence of the offense for which an employee is penalized."

Sanden has the burden of proof to prove its allegations.

the burden of establishing facts as bases for an employer’s loss of confidence in an employee – facts which reasonably generate belief by the employer that the employee was connected with some misconduct and the nature of his participation therein is such as to render him unworthy of trust and confidence demanded of his position – is on the employer."

While it is true that loss of trust and confidence is one of the just causes for termination, such loss of trust and confidence must, however, have some basis. Proof beyond reasonable doubt is not required. It is sufficient that there must only be some basis for such loss of confidence or that there is reasonable ground to believe if not to entertain the moral conviction that the concerned employee is responsible for the misconduct and that the nature of his participation therein rendered him absolutely unworthy of trust and confidence demanded by his position.

Sanden failed to discharge the burden of proof that the dismissal of Loressa is for a just cause.

1st requisite for dismissal on the ground of loss of trust and confidence -employee concerned must be holding a position of trust and confidence. (Loressa held a position of trust and confidence as Coordinator and Data Custodian of the MIS Department.)

2nd requisite - there must be an act that would justify the loss of trust and confidence. Loss of trust and confidence, to be a valid cause for dismissal, must be based on a willful breach of trust and founded on clearly established facts. The basis for the dismissal must be clearly and convincingly established but proof beyond reasonable doubt is not necessary." (Sanden’s evidence against Loressa fails to meet this standard.)

LA - nowhere in the records can be found evidence that directly point to complainant as having committed acts of sabotage. Also, during the administrative investigation, the guilt of complainant-appellee was based on mere allegations not supported by documentary evidence nor any factual basis. Even appellants cannot directly pinpoint appellee as the culprit. They were only thinking of her as the one probably responsible thereto, considering that when she used the computer, she told the other users to log out and thereafter, used the computer for 16 minutes, with only 1 minute as usage time. But these allegations would not suffice (sic) termination of employment of appellee. Note that security of tenure is protected by constitutional mandate.

there was no evidence presented to prove that Loressa indeed committed "data sabotage. It is therefore a mere theory with no apparent factual basis, testimonial or documentary evidence, that would establish the guilt of Loressa for the charges of "data sabotage."

Loressa was able to provide documentary evidence to show that Sanden’s computer system was experiencing some problems even before May 16, 1997.

problem of missing data already existed as early as 1995, when Loressa was still an MIS Secretary and was not yet tasked to back up the Marketing Delivery Receipt Transaction files.

It is not difficult to see that the imputed guilt of the petitioner was based on mere allegations and theories held by private respondents as possible causes for the deletion of the subject files. In the first place, if

the subject delivery receipt files were as crucial to the operations of the company as what the private respondents claimed them to be, then sound business judgment would dictate that it keep a record or paper trail of all its delivery transactions which could still be made available to the Finance Department for its billing and collection activities. It is common knowledge that no computer system is absolutely ‘crash proof" or "bug-free" and that a total obliteration of a particular computer file could be attributed to so many other causes other than the deliberate deletion of the same. In the second place, the deletion of the subject files could have occurred at any one point or time and not necessarily during the time at which the petitioner was the only registered user in the system. In this case, the private respondents failed to determine with absolute certainty and to show proof of the exact date or time when it occurred. Third and last, while it may be true that the petitioner had access to the subject files as well as the code to delete the same, it is hardly believable that she would be the sole person in the company who could access the same. It is noted that the petitioner worked under the supervision of an MIS Manager as well as other company officers, who in all probability also had access to the same files and codes available to the petitioner.

Sanden failed in discharging the burden of proof that the dismissal of Loressa is for a just cause, we have no other recourse but to declare that she was illegally dismissed based on the ground of loss of trust and confidence. This is in consonance with the constitutional guarantee of security of tenure.

G.R. No. 164662 February 18, 2013

MARIA LOURDES C. DE JESUS, Petitioner, vs.HON. RAUL T. AQUINO, PRESIDING COMMISSIONER, NATIONAL LABOR RELATIONS COMMISSION, SECOND DIVISION, QUEZON CITY, and SUPERSONIC SERVICES, INC., Respondents.

x - - - - - - - - - - - - - - - - - - - - - - - x

G.R. No. 165787

SUPERSONIC SERVICES, INC., Petitioner vs. MARIA LOURDES C. DE JESUS, Respondent.

BERSAMIN, J.:

Principle - The dismissal of an employee for a just or authorized cause is valid despite the employer's non-observance of the due process of law the Labor Code has guaranteed to the employee. The dismissal is effective against the employee subject to the payment by the employer of an indemnity.

Facts

February 20, 2002, De Jesus filed with LA a complaint for illegal dismissal against Supersonic for brevity, Pakistan Airlines, Gil Puyat, Jr. and Divina Abad Santos

De Jesus allege-she was employed by Supersonic since February 1976 until her illegal dismissal of March 15, 2001; from 1976 to 1992, she held the position of reservation staff, and from 1992 until her illegal dismissal on March 15, 2001, she held the position of Sales Promotion Officer where she solicited clients for Supersonic and sold plane tickets to various travel agencies on credit; on March 12, 2001, she had an emergency hysterectomy operation preceded by continuous bleeding; she stayed at the Makati Medical Center for three (3) days and applied for a sixty-(60) day leave in the meantime; on June 1, 2001, she went to Supersonic and found the drawers of her desk opened and her personal belongings packed, without her knowledge and consent; while there, Abad Santos, general manager, asked her to sign a promissory note and directed her secretary not to allow her to leave unless she execute a promissory note; she was later forced to execute a promissory note which she merely copied from the draft prepared by Santos and Malubay; she was also forced to indorse to Supersonic her SSS check in the amount of P25,000.00 which represents her benefits from the hysterectomy operation; there was no notice and hearing nor any opportunity given her to explain her side prior to the termination of her employment; Supersonic even filed a case for Estafa against her for her alleged failure to remit collections despite the fact that she had completely remitted all her collections; and the termination was done in bad faith and in violation of due process.

Supersonic said- as Sales Promotion Officer, De Jesus was fully authorized to solicit clients and receive payments for and in its behalf, and as such, she occupied a highly confidential and financially sensitive position in the company; based on the company records, an outstanding balance of U.S.$36,168.39 accumulated under the account of De Jesus; after verifications with its clients, it discovered that the amount of U.S.$36, 168.39 were already paid to De Jesus but this was not turned over and duly accounted for by her; hence, another memorandum was issued to De Jesus directing her to explain in writing why she should not be dismissed for cause for failure to

account for the total amount of U.S.$36, 168.39; De Jesus was informed that her failure to explain in writing shall be construed that she misappropriated said amount for her own use and benefit to the damage of the company; De Jesus was likewise verbally notified of the company’s intention to dismiss her for cause; after due investigation and confrontation, De Jesus admitted that she received the U.S.$36,168.39 from their clients and even executed a promissory note in her own handwriting acknowledging her obligation; she was fully aware of her dismissal and even obligated herself to offset her obligation with any amount she would receive from her retirement; when De Jesus failed to comply with her promise to settle her obligation, a demand letter was sent to her; because of her persistent failure to settle the unremitted collections, it was constrained to suspend her as a precautionary measure and to protect its interests; despite demands, De Jesus failed to fulfill her promise, hence, a criminal case for estafa was filed against her; and in retaliation to the criminal case filed against her, she filed this illegal dismissal case.

LA Ruling

-ruled against De Jesus, declaring her dismissal to be for just cause and finding that she had been accorded due process of law.

NLRC Ruling

-Affirmed. Records show complainant was required to explain in writing why she should not be dismissed from employment for her failure to account for the cash collections in her custody. Complainant acknowledged her failure to effect a turn-over of the amount of US$36,168.39 to the respondent. More than this, she offered no explanation for her failure to immediately account for her collections. Further, her allegation of duress may not be accorded credence, there being no evidence as to the circumstances under which her consent was allegedly vitiated. Having been given the opportunity to explain her side, complainant may not successfully claim that she was denied due process. Further, her admission and other related evidence, particularly the finding of a prima facie case for estafa against her, and corroborative statements from respondent’s client, sufficiently controvert complainant’s assertion that no just cause existed for the dismissal.

CA- partly meritorious

Issues: (1) Whether or not Supersonic was justified in terminating De Jesus’ employment; (2) Whether or not Supersonic complied with the two-written notice rule

Ruling

- first issue, Supersonic substantially proved that De Jesus had failed to remit and had misappropriated the amounts she had collected in behalf of Supersonic. the dismissal of De Jesus was valid.

Article 282 of the Labor Code enumerates the causes by which the employer may validly terminate the employment of the employee

Article 282.Termination by employer. - An employer may terminate an employment for any of the following causes:

(c) Fraud or willful breach by the employee of the trust reposed in him by his employer or duly authorized representative;

The CA observed that De Jesus had not disputed her failure to remit and account for some of her collections, for, in fact, she herself had expressly admitted her failure to do so through her letters dated April 5, 2001 and May 15, 2001 sent to Supersonic’s general manager.

She defrauded her employer or willfully violated the trust reposed in her by Supersonic.

Proof beyond reasonable doubt of her violation of the trust was not required, for it was sufficient that the employer had "reasonable grounds to believe that the employee concerned is responsible for the misconduct as to be unworthy of the trust and confidence demanded by [her] position."11

- Second issue, affirm the decision of the CA holding that Supersonic had not complied with the twowritten notice rule.

- the betrayal of the trust the employer reposed in De Jesus was the essence of the offense for which she was to be validly penalized with the supreme penalty of dismissal. She was still entitled to due process in order to effectively safeguard her security of tenure. The law affording to her due process as an employee imposed on Supersonic as the employer the obligation to send to her two written notices before finally dismissing her. This requirement of two written notices is enunciated in Article 277of the Labor Code. The requirement was mandatory.

- The memoranda did not satisfy the requirement for the two written notices under the law. The March 26, 2001 memorandum did not specify the

grounds for which her dismissal would be sought, and for that reason was at best a mere reminder to De Jesus to submit her report on the status of her accounts. The May 12, 2001 memorandum did not provide the notice of dismissal under the law because it only directed her to explain why she should not be dismissed for cause. The latter memorandum was apparently only the first written notice under the requirement. Insufficiency of the two memoranda as compliance with the two-written notices requirement of due process . The various memoranda given her were not the same notices required by law, as they were mere internal correspondences intended to remind De Jesus of her outstanding accountabilities to the company. Assuming for the sake of argument that the memoranda furnished to De Jesus may have satisfied the minimum requirements of due process, still, the same did not satisfy the notice requirement under the Labor Code because the intention to sever the employee’s services must be made clear in the notice. Such was not apparent from the memoranda.

- As the Supreme Court held in Serrano, the violation of the notice requirement is not strictly a denial of due process. This is because such notice is precisely intended to enable the employee not only to prepare himself for the legal battle to protect his tenure of employment, but also to find other means of employment and ease the impact of the loss of his job and, necessarily, his income.

-The dismissal of De Jesus should therefore be struck (down) as ineffectual.

-Under Agabon, the new doctrine is that the failure of the employer to observe the requirements of due process in favor of the dismissed employee (that is, the two-written notices rule) should not invalidate or render ineffectual the dismissal for just or authorized cause. The Agabon Court plainly saw the likelihood of Serrano producing unfair butfar-reaching consequences, such as, but not limited to, encouraging frivolous suits where even the most notorious violators of company policies would be rewarded by invoking due process; to having the constitutional policy of providing protection to labor be used as a sword to oppress the employers; and to compelling the employers to continue employing persons who were admittedly guilty of misfeasance or malfeasance and whose continued employment would be patently inimical to the interest of employers.28

Even so, the Agabon Court still deplored the employer's violation of the employee's right to statutory due process by directing the payment of indemnity in the form of nominal damages, the amount of which would be addressed to the sound discretion of the labor tribunal upon taking into account the relevant circumstances. Thus, the Agabon Court designed such form of damages as a deterrent to employers from committing in the future violations of the statutory due process rights of employees, and, at the same time, as at the very least a vindication or recognition of the fundamental right granted to the employees under the Labor Code and its implementing rules.29 Accordingly, consistent with precedent30 the amount of P50,000.00 as nominal damages is hereby fixed for the purpose of indemnifying De Jesus for the violation of her right to due process.

WHEREFORE, the Court DECLARES the dismissal of Maria Lourdes C. De Jesus for just or authorized cause as valid and effectual; and ORDERS Supersonic Services, Inc. to pay to Maria Lourdes C. De Jesus P50,000.00 as nominal damages to indemnify her for the violation of her right to due process. No pronouncements on costs of suit.

G.R. No. 187232 April 17, 2013

ZENAIDA D. MENDOZA, Petitioner, vs. HMS CREDIT CORPORATION and/or FELIPE R. DIEGO, MA. LUISA B. DIEGO, HONDA MOTOR SPORTS CORPORATION and/or FELIPE R. DIEGO, MA. LUISA B. DIEGO, BETA MOTOR TRADING INCORPORATED and/or FELIPE DIEGO, MA. LUISA B. DIEGO, JIANSHE CYCLE WORLD IN CORPORATED and/or JOSE B. DIEGO, Respondents.

SERENO, CJ.:

Facts:

- (Mendoza) was the Chief Accountant of (HMS Credit) beginning 1 August 1999.2 During her employment, she simultaneously serviced three other respondent companies, all part of the Honda Motor Sports Group (HMS Group),

- Respondent (Luisa) was the Managing Director of HMS Credit, while respondent (Felipe) was the company officer to whom Mendoza directly reported.

- Mendoza avers that on 11 April 2002, after she submitted to Luisa the audited financial statements, Felipe summoned Mendoza to advise her of her termination from service. She claims that she was even told to leave the

premises without being given the opportunity to collect her personal belongings.

- She was stopped by the security guards and barred from entering the building

- Respondents maintain that Mendoza was hired on the basis of her qualification as a (CPA), which turned out to be a misrepresentation.They likewise contend that not only did she fail to disclose knowledge of the resignations of two HMS Group officers, (Labasan) and (de la Cruz), and their subsequent transfer to a competitor company, but she also had a hand in pirating them. Thus, on 12 April 2002, they supposedly confronted her about these matters. In turn, she allegedly told them that if they had lost their trust in her, it would be best for them to part ways.12 Accordingly, they purportedly asked her to propose an amount representing her entitlement to separation benefits. Before she left that night, they allegedly handed her P30,000 as payment for the external auditor she had contracted to examine the books of the HMS Group.

- Mendoza filed with the (NLRC) a Complaint for Illegal Dismissal

LA Decision

- Mendoza had been illegally dismissed, and that the dismissal had been effected in violation of due process requirements.

NLRC Decision

- Reversed, declared that Mendoza had not been summarily dismissed.

CA

- There was no dismissal, as the parties had entered into a compromise agreement whereby respondents offered to pay Mendoza separation benefits in exchange for her voluntary resignation.

ISSUE: W/N the CA erred in ruling that there was no illegal dismissal.

Ruling:

Art. 282. Termination by employer. An employer may terminate an employment for any of the following causes:

a. Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or 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 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 representatives; and

e. Other causes analogous to the foregoing.

Art. 285. Termination by employee.

a. An employee may terminate without just cause the employee-employer relationship by serving a written notice on the employer at least one (1) month in advance. The employer upon whom no such notice was served may hold the employee liable for damages.

b. An employee may put an end to the relationship without serving any notice on the employer for any of the following just causes:

1. Serious insult by the employer or his representative on the honor and person of the employee;

2. Inhuman and unbearable treatment accorded the employee by the employer or his representative;

3. Commission of a crime or offense by the employer or his representative against the person of the employee or any of the immediate members of his family; and

4. Other causes analogous to any of the foregoing.

In instances in which the termination of employment by the employer is based on breach of trust, a distinction must be made between rank-and-file employees and managerial employees, thus:

The degree of proof required in labor cases is not as stringent as in other types of cases. It must be noted, however, that recent decisions of this Court have distinguished the treatment of managerial employees from that of rank-and-file personnel, insofar as the application of the doctrine of loss of trust and confidence is concerned. Thus, with respect to rank-and-file personnel, loss of trust and confidence as ground for valid dismissal requires proof of involvement in the alleged events in question, and that mere uncorroborated assertions and accusations by the employer will not be sufficient. But as regards a managerial employee, the mere existence of a basis for believing that such employee has breached the trust of his employer would suffice for his dismissal. Hence, in the case of managerial employees, proof beyond reasonable doubt is not required, it being sufficient that there is some basis for such loss of confidence, such as when the employer has reasonable ground to believe that the employee concerned is responsible for the purported misconduct, and the nature of his participation therein renders him unworthy of the trust and confidence demanded by his position.

Further, in the case of termination by the employer, it is not enough that there exists a just cause therefor, as procedural due process dictates compliance with the two-notice rule in effecting a dismissal.

On the other hand, if the termination of employment is by the employee, the resignation must show the concurrence of the intent to relinquish and the overt act of relinquishment.

She was a managerial employee. In securing this position, she fraudulently misrepresented her professional qualifications by stating in her Personal Information Sheet that she was a CPA. Based on the records, she never controverted this imputation of dishonesty or, at the very least, provided any explanation therefor. Thus, this deceitful action alone was sufficient basis for respondents’ loss of confidence in her as a managerial employee.

In sum, the commission finds that Mendoza was not illegally dismissed. Respondents could have validly dismissed her for just cause because she had forfeited her employment by having incurred breach of trust that they had reposed in her. These were acts of disloyalty for which [they] would have been justified in terminating her service on the ground of loss of confidence.

However, despite the existence of a just cause for termination, Mendoza was nevertheless dismissed from service in violation of procedural due process, as respondents failed to observe the two-notice requirement.

Respondents were unable to discharge their burden to prove the contemporaneous existence of an intention on the part of Mendoza to resign and an overt act of resignation. Aside from their self-serving allegation that she had offered to resign after they had expressed their loss of trust in her, there is nothing in the records to show that she voluntarily resigned from her position in their company. In this regard, it is worthy to underscore the established rule that the filing of a complaint for illegal dismissal is inconsistent with resignation or abandonment.

Moreover, the conclusion of the NLRC and the CA that Mendoza voluntarily resigned in consideration of respondents’ supposed payment of a settlement is bereft of any basis. The lower tribunals merely surmised that the parties forged a compromise agreement despite respondents’ own admission that they never decided thereon. In fact, the records are clear that none of the parties claimed the existence of any settlement in exchange for her resignation.

From the foregoing discussion, it is evident that although there was a just cause for terminating the services of Mendoza, respondents were amiss in complying with the two-notice requirement. Following the prevailing jurisprudence on the matter, if the dismissal is based on a just cause, then the non-compliance with procedural due process should not render the termination from employment illegal or ineffectual. Instead, the employer must indemnify the employee in the form of nominal damages. Therefore, the dismissal of Mendoza should be upheld, and respondents cannot be held liable for the payment of either backwages or separation pay. Considering all the circumstances surrounding this case, this Courts finds the award of nominal damages in the amount of P30,000 to be in order.

-Petition DENIED. AFFIRMED WITH MODIFICATION: the award of separation pay is deleted and nominal damages in the amount of P30,000 is awarded to petitioner.

22 ROLANDO DS. TORRES, PETITIONER, VS. RURAL BANK OF SAN JUAN, INC., ANDRES CANO CHUA, JOBEL GO CHUA, JESUS CANO CHUA, MEINRADO DALISAY, JOSE MANALANSAN ILL, OFELIA GINABE AND NATY ASTRERO,

RESPONDENTS.

D E C I S I O N

The antecedents The petitioner was initially hired by RBSJI as Personnel and Marketing

Manager in 1991.

Petitioner accepted the position of Vice-President for RBSJI’s newly created department, Allied Business Ventures.

The vacancy created was filled by respondent Jobel Petitioner was temporarily assigned as the manager of RBSJI’s N.

Domingo branch Jacinto requested the petitioner to sign a standard employment

clearance but declined his request. Jacinto threw a fit and shouted foul invectives. To pacify him, the petitioner bargained to issue a clearance but only

for Jacinto’s paid cash advances and salary loan. Jacinto was later found to have unliquidated cash advances and was

responsible for a questionable transaction involving P11 million. The petitioner submitted his explanation clarifying that the clearance

was limited only to Jacinto’s paid cash advances and salary loan based on the receipts presented by Lily, the cashier of N. Domingo branch.

After conducting an investigation, RBSJI’s Human Resources Department recommended the petitioner’s termination from employment.

RBSJI’s Board of Directors adopted. Petitioner filed the herein complaint for illegal dismissal, illegal

deduction, non-payment of service incentive, leave pay and retirement benefits.

He claimed that he was deceived to accept a Vice-President position, which turned out to be a mere clerical and menial work, so the respondents can install Jobel, the son of a major stockholder of RBSJI, as Personnel and Marketing Manager.

The petitioner further alleged that he was cunningly assigned at N. Domingo branch so he can be implicated in the anomalous transaction perpetrated by Jacinto.

Accdg to RESPONDENTS: Respondents maintained that the petitioner was validly dismissed for

loss of trust and confidence precipitated by his unauthorized issuance of a financial accountability clearance.

They averred that a copy of the clearance mysteriously disappeared from RBSJI’s records hence, the petitioner’s claim that it pertained only to Jacinto’s paid cash advances and salary loan cannot stand for being uncorroborated.

Ruling of LA and NLRC sustained the claims of the petitioner as against the factually

unsubstantiated allegation of loss of trust and confidence propounded by the respondents.

petitioner was found to have been illegally dismissed

Ruling of the CA As the Acting Manager of RBSJI’s N. Domingo branch, the petitioner

held a highly sensitive and critical position which entailed the conscientious observance of company procedures. Not only was he unauthorized to issue the clearance, he also failed to exercise prudence in clearing Jacinto of his accountabilities given the fact that the same were yet to be audited. Such omission financially prejudiced RBSJI and it amounted to gross negligence and incompetence sufficient to sow in his employer the seed of mistrust and loss of confidence

The Court’s Ruling

The respondents failed to provethat the petitioner was dismissedfor a just cause.

The law mandates that before validity can be accorded to a dismissal premised on loss of trust and confidence, two requisites must concur, (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]

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 petitioner’s 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.The absence of the clearance upon which the contradicting claims of the parties could ideally be resolved, should work against the respondents.

RBSJI also failed to substantiate its claim that the petitioner’s 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 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 RBSJI’s 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 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 RBSJI’s 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 Jacinto’s demands and thus prevent compromising RBSJI’s image, employees and clients to an alarming scene.

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 settled by Jacinto.

The petitioner is entitled to separation pay in lieu of reinstatement and his back wages shall earn legal interest. (MAIN ISSUE based on case list)

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 petitioner’s illegal dismissal until the finality of this decision.[41]

Thereafter, it shall earn 12% legal interest until fully paidThus, 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 moral and exemplarydamages is not warranted.

Illegal dismissal, by itself alone, does not entitle the dismissed employee to moral damages; additional facts must be pleaded and proven to warrant the grant of moral damages, thus:

[M]oral damages are recoverable only where the dismissal of the employee 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. Here, the petitioner failed to prove that his dismissal was attended by explicit oppressive, humiliating or demeaning acts. Since no moral damages can be granted under the facts of the case, exemplary damages cannot also be awarded.[50]

The solidary liability of individual respondents as corporate officersmust be recalled.

individual respondents cannot be made solidarily liable with RBSJI for the illegal dismissal. A corporation has its own legal personality separate and distinct from those of its stockholders, directors or officers. Hence, absent any evidence that they have exceeded their authority, corporate officers are not personally liable for their official acts. Corporate directors and officers may be held solidarily liable with the corporation for the termination of employment only if done with malice or in bad faith.

The award of 13th month pay is incorrect.

Being a managerial employee, the petitioner is not entitled to 13th month pay.

The award of attorney’s fees is proper.It is settled that where an employee was forced to litigate and, thus, incur expenses to protect his rights and interest, the award of attorney’s fees is legally and morally justifiable.[54] Pursuant to Article 111 of the Labor Code, ten percent (10%) of the total award is the reasonable amount of attorney’s fees that can be awarded.

23.BERNADETH LONDONIO AND JOAN CORCORO, PETITIONERS, VS. BIO RESEARCH, INC. AND WILSON Y. ANG, RESPONDENTS.

Petitioners Bernadeth E. Londonio (Bernadeth) and Joan T. Corcoro (Joan) were hired by respondent Bio Research Inc. (Bio Research) as graphic/visual artists.

Bio Research informed its employees including petitioners it would be severing their employment with the company.

Bio Research filed an Establishment Termination Report[2] with the Department of Labor and Employment (DOLE) stating that it was retrenching 18 of its employees including petitioners due to redundancy and to prevent losses.

Joan accepted her retrenchment pay in the sum of P9,990.14 and executed a Quitclaim and Waiver

Bernadeth refused to accept hers. Petitioners later filed a complaint for illegal dismissal, moral and

exemplary damages and attorney's fees against respondent Bio Research and its co-respondent President/CEO Wilson Y. Ang (Ang).

Petitioners claimed that their dismissal was done in bad faith and tainted with malice, being retaliatory in nature, following the filing by Bernadeth of a complaint against Jose Ang, Jr. (Jose), one of Bio

Research's managers, for a sexual harassment incident that occurred in his office on February 19, 2005.

To refute Bio Research's claim that it had been incurring business losses, Joan cited the recommendation for her regularization on April 12, 2005, 18 days before she received a copy of the Memorandum of April 30, 2005.

Labor Arbiter and NLRC ruled in favor of petitioners Court of Appeals pronounced that Joan could no longer question the

legality of her dismissal in light of her execution of the quitclaim and waiver. It deleted the award of moral and exemplary damages.[11]

HELD: Bio Research did not only fail to "submit in evidence its audited financial statements to show its financial condition prior to and at the time it enforced its retrenchment program"; it also failed to show that it adopted fair and reasonable standards in ascertaining who would be retained or dismissed among it employees.[16]

It is, however, with respect to the appellate court's ruling that Joan is, on account of her execution of the waiver and quitclaim, estopped from questioning her dismissal that this Court takes exception.

An employee's execution of a final settlement and receipt of amounts agreed upon do not foreclose his right to pursue a claim for illegal dismissal.[17] For, as reflected above, Joan was illegally retrenched. She is thus entitled to reinstatement without loss of seniority rights and privileges, as well as to payment of full backwages from the time of her separation until actual reinstatement, less the amount of P9,990.14 which she received as retrenchment pay.

As for the deletion by the appellate court of the award of moral and exemplary damages, the same is in order too, petitioners having failed to substantiate their claim that their dismissal was made in bad faith.

24

PLASTIMER INDUSTRIAL CORPORATION AND TEO KEE BIN, PETITIONERS, VS. NATALIA C. GOPO, KLEENIA R. VELEZ, FILEDELFA T. AMPARADO, MIGNON H.

JOSEPH, AMELIA L. CANDA, MARISSA D. LABUNOS, MELANIE T. CAYABYAB, MA. CORAZON DELA CRUZ, AND LUZVIMINDA CABASA, RESPONDENTS.

The Antecedent Facts The Personnel and Administration Manager of Plastimer issued a

Memorandum informing all its employees to downsize and reorganize its business operations due to withdrawal of investments and shares of stocks which resulted in the change of its corporate structure.

Plastimer and PICCB, the incumbent sole and exclusive collective bargaining representative of all rank and file employees, entered into a Memorandum of Agreement (MOA)

Plastimer submitted to the Department of Labor and Employment (DOLE) an Establishment Termination Report containing the list of the employees affected by the reorganization and downsizing.

Respondents, signed individual "Release Waiver and Quitclaim." Respondents filed a complaint for illegal dismissal with prayer for

reinstatement and full backwages, underpayment of separation pay, moral and exemplary damages and attorney's fees.

Respondents alleged that they did not voluntarily relinquish their jobs and that they were required to sign the waivers and quitclaims without giving them an opportunity to read them and without explaining their contents.

Respondents further alleged that Plastimer failed to establish the causes/valid reasons for the retrenchment and to comply with the one-month notice to the DOLE as well as the standard prescribed under the Collective Bargaining Agreement between Plastimer and the employees.

Petitioners countered that the retrenchment was a management prerogative and that respondents got their retrenchment or separation pay even before the effective date of their separation from service.

The Decisions of the Labor Arbiter and the NLRC

Petitioners were able to prove that there was a substantial withdrawal of stocks that led to the downsizing of the workforce and respondents claimed their separation pay in accordance with the MOA. Respondents could not claim ignorance of the contents of the waivers and quitclaims because they were assisted by the union President and their counsel in signing them.

The Decision of the Court of Appeals

Reversed the NLRC decision. there was no valid cause for retrenchment. Plastimer failed to use a reasonable and fair standard or criteria in ascertaining who would be dismissed and who would be retained among its employees. MOA between Plastimer and PICCB only recognized the need for partial retrenchment

and the computation of retrenchment pay without disclosing the criteria in the selection of the employees to be retrenched.

The Ruling of this CourtOne-Month Notice of Termination of Employment

Plastimer submitted the notice of termination of employment to the DOLE on 26 May 2004. However, notice to the affected employees were given to them on 14 May 2004 or 30 days before the effectivity of their termination from employment on 13 June 2004. While notice to the DOLE was short of the one-month notice requirement, the affected employees were sufficiently informed of their retrenchment 30 days before its effectivity. Petitioners' failure to comply with the one-month notice to the DOLE is only a procedural infirmity and does not render the retrenchment illegal.

The failure to fully comply with the one-month notice of termination of employment did not render the retrenchment illegal but it entitles respondents to nominal damages.

Validity of Retrenchment

An independent auditor confirmed petitioners' losses for the years 2001 and 2002. Records showed that the net income of P6,185,707.05 for 2003 was not

even enough for petitioners to recover from the P52,904,297.88 loss in 2002.[15]

Article 283 of the Labor Code recognizes retrenchment to prevent losses as a right of the management to meet clear and continuing economic threats or

during periods of economic recession to prevent losses.[16] There is no need for the employer to wait for substantial losses to materialize before exercising

ultimate and drastic option to prevent such losses.[17]

Validity of Waivers and Quitclaims

The Court has ruled that a waiver or quitclaim is a valid and binding agreement between the parties, provided that it constitutes a credible and reasonable settlement, and that the one accomplishing it has done so voluntarily and with a full understanding of its import.[18]

Respondents were sufficiently apprised of their rights under the waivers and quitclaims that they signed.

. Art. 283 (Retrenchment) – Genuino Ice Company vs. Lava, GR#190001 (March 23, 2011)Republic of the Philippines

G.R. No. 190001 March 23, 2011GENUINO ICE COMPANY, INC., HECTOR S. GENUINO and EDGAR A. CARRIAGA, Petitioners, vs.ERIC Y. LAVA and EDDIE BOY SODELA, Respondents.

Petitioner GICI hired the respondents Eric Y. Lava and Eddie Boy Sodela (respondents) as ice plant machine operators

due to the continuous decline of demand for ice products, the company was forced to shut down a part of its plant facilities and operations, and to implement a work rotation or reduction of workdays program affecting its seven (7) workers (including the present respondents).

On September 30, 2005, GICI, through its personal manager, issued a memorandum ordering the deletion of the respondents’ names from the work schedule. The memorandum had the effect of banning the respondents from entering the company premises. The respondents reacted to this move by filing a complaint for illegal dismissal with the Labor Arbiter (LA).

petitioners alleged that the respondents were contractual employees who were under the control of VICAR General Contractor & Management Services (VICAR), and L.C. Moreno General Contractor & Management Services (MORENO), argue that there is no employer-employee relationship between GICI and the respondents so that the latter have no cause of action against the petitioners

petitioners reason that due to the partial shut-down of the company, GICI was excused from complying with the 30-day notice or clearance requirement under the law

LA - rejected the petitioner’s argument and declared that the respondents adduced convincing evidence that they were the employees of GICI - ruled that the respondents were validly retrenched - due to the continuous decline in the sales output of the ice plant, the temporary shut down had become permanent and GICI had no alternative but to trim-down its manpower requirements - found that GICI failed to comply with the procedural requirements for a valid retrenchment. - awarded the respondents their separation pay equivalent to one-half (1/2) month salary for every year of service in accordance with Art. 283 of the Labor CodE

NLRC – reversed – illegally dismissed CA - petitioners failed to prove that GICI incurred or was about to incur

financial losses leading to the retrenchment it undertook; no documentary evidence was in fact presented to support the

retrenchment claim - no documentary evidence was in fact presented to support the retrenchment claim

ISSUE : whether there had been a valid retrenchment (and hence, a valid termination of the respondents’ service).RULING: AFFIRMED

Under Article 283 of the Labor Code, there are three (3) basic requisites for a valid retrenchment, namely: (a) proof that the retrenchment is necessary to prevent losses or impending losses; (b) service of written notices to the employees and to the DOLE at least one (1) month prior to the intended date of retrenchment; and (c) payment of separation pay equivalent to one (1) month pay, or at least one-half (1/2) month pay for every year of service, whichever is higher

no reason to reverse the NLRC and CA findings that no documentary evidence exists in the records to substantiate the claimed business losses; in fact, the petitioners also failed to show its financial conditions prior to and at the time GICI enforced its retrenchment program

full backwages and separation pay in lieu of reinstatement respondents were illegally dismissed as the employer failed to prove

that their dismissal was for a duly authorized cause CA decision is incomplete as it failed to specify the separation pay to

be awarded to the respondents as well as the reckoning point for the computation of the backwages

FF Marine Corporation11 tells us that the separation pay shall be computed at one (1) month pay (for those with one year or less of service), or one-half (1/2) month pay for every year of service (for those with more than a year of service), whichever is higher, a fraction of at least six (6) months being considered one whole year.12 The backwages shall be computed from the date of termination of service (September 30, 2005) until the finality of this Court’s decision

Eric Lava shall be awarded full backwages from September 30, 2005 until the finality of this Court’s Decision. Separation pay in lieu of reinstatement shall be computed at 1 month pay for every year of service, with years of service reckoned from the respondents’ first day of employment up to the finality of this Decision

26. Art. 283 (Separation pay) – Reno Foods vs. Nagkakaisang Lakas ng Manggagawa, GR#164016 (March 15, 2010)

RENO FOODS, INC., AND/OR VICENTE KHU, PETITIONERS, VS. NAGKAKAISANG LAKAS NG MANGGAGAWA (NLM) - KATIPUNAN ON BEHALF OF ITS MEMBER, NENITA CAPOR, RESPONDENT

There is no legal or equitable justification for awarding financial assistance to an employee who was dismissed for stealing company property. Social justice and equity are not magical formulas to erase the unjust acts committed by the employee against his employer. While compassion for the poor is desirable, it is not meant to coddle those who are unworthy of such consideration

FACTS:

Reno Foods, Inc. (Reno Foods) is a manufacturer of canned meat products of which Vicente Khu is the president

Respondent Nenita Capor (Capor) was an employee of Reno Foods until her dismissal on October 27, 1998

On October 19, 1998, the guard on duty found six Reno canned goods wrapped in nylon leggings inside Capor's fabric clutch bag

filed a complaint-affidavit against Capor for qualified theft, On April 5, 1999, a Resolution[3] was issued finding probable cause for the crime charged

(NLM) - Katipunan filed on behalf of Capor a complaint for illegal dismissal and money claims against petitioners AND prayed that Capor be paid her full backwages as well as moral and exemplary damages

Capor alleged that she was unaware that her clutch bag contained the pilfered canned products - claimed that petitioners might have planted the evidence against her so it could avoid payment of her retirement benefits, as she was set to retire in about a year's time

LA – Capor guilty of Serious Misconduct (just cause for termination) Under Article 232 of the Labor Code, an employer may terminate the

services of an employee for just cause, such as serious misconduct LA- theft of company property is tantamount to serious misconduct; as

such, Capor is not entitled to reinstatement and backwages, as well as moral and exemplary damages. - not entitled to separation pay

NLRC affirmed - but added an award of financial assistance CA – affirmed award of financial assistance despite claim of petitioner

citing PLDT v NLRC that theft of company property is a form of serious misconduct under Article 282(a) of the Labor Code for which no financial assistance in the form of separation pay should be allowed

ISSUE: whether the NLRC committed grave abuse of discretion amounting to lack or excess of jurisdiction in granting financial assistance to an employee who was validly dismissed for theft of company property

RULING: CA and NLRC Annuled and Set Aside , LA -reinstated

Conviction in a criminal case is not necessary to find just cause for termination of employment

Capor thus claims that her acquittal in the criminal case proves that petitioners failed to presentsubstantial evidence to justify her termination from the company. She therefore asks for a finding of illegal dismissal and an award of separation pay equivalent to one month pay for every year of service

petitioners argue that the dismissal of a criminal action should not carry a corresponding dismissal of the labor action since a criminal conviction is unnecessary in warranting a valid dismissal for employment.

Capor was acquitted in criminal case based on reasonable doubt the trial judge entertained doubts regarding the guilt of Capor because

of two circumstances: (1) an ensuing labor dispute (though it omitted to state the parties involved), and (2) the upcoming retirement of Capor. The trial judge made room for the possibility that these circumstances couldhave motivated petitioners to plant evidence against Capor so as to avoid paying her retirement benefits. The trial court did not categorically rule that the acts imputed to Capor did not occur

Where doubt exists, even if only a shred, the Court must and should set the accused free."

Criminal cases require proof beyond reasonable doubt while labor disputes require only substantial evidence, which means such relevant evidence as a reasonable mind might accept as adequate to justify a conclusion.

The lower courts found substantial evidence to conclude that Capor had been validly dismissed for dishonesty or serious misconduct

The award of separation pay is not warranted under the law and jurisprudence

We find no justification for the award of separation pay to Capor. This award is a deviation from established law and jurisprudence

The law is clear. Separation pay is only warranted when the cause for termination is not attributable to the employee's fault, such as those provided in Articles 283 and 284 of the Labor Code, as well as in cases of illegal dismissal in which reinstatement is no longer feasible

It is not allowed when an employee is dismissed for just cause – such as serious misconduct

Jurisprudence has classified theft of company property as a serious misconduct and denied the award of separation pay to the erring employee

It is true that there have been instances when the Court awarded financial assistance to employees who were terminated for just causes, on grounds of equity and social justice – like in the case of PLDT v NLRC - In that case, the court recognized the harsh realities faced by employees that forced them, despite their good intentions, to violate company policies, for which the employer can rightfully terminate their employment. For these instances, the award of financial assistance was allowed. But, in clear and unmistakable language, we also held that the award of financial assistance shall not be given to validly terminated employees, whose offenses are iniquitous or reflective of some depravity in their moral character. When the employee commits an act of dishonesty, depravity, or iniquity, the grant of financial assistance is misplaced compassion. It is tantamount not only to condoning a patently illegal or dishonest act, but an endorsement thereof. It will be an insult to all the laborers who, despite their economic difficulties, strive to maintain good values and moral conduct

Court not persuaded by Capor's argument that despite the finding of theft, she should still be granted separation pay in light of her long years of service with petitioners

Although long years of service might generally be considered for the award of separation benefits or some form of financial assistance to mitigate the effects of termination, this case is not the appropriate instance for generosity

length of service and a previously clean employment record cannot simply erase the gravity of the betrayal exhibited by a malfeasant employee

it may be said that betrayal by a long-time employee is more insulting and odious for a fair employer

SC - While we sympathize with Capor's plight, being of retirement age and having served petitioners for 39 years, we cannot award any financial assistance in her favor because it is not only against the law but also a retrogressive public policy. We have already explained the folly of granting financial assistance in the guise of compassion in the following pronouncements:

x x x Certainly, a dishonest employee cannot be rewarded with separation pay or any financial benefit after his culpability is established in two decisions by competent labor tribunals, which decisions appear to be well-supported by evidence. To hold otherwise, even in the name of compassion, would be to send a wrong signal not only that "crime pays" but also that one can enrich himself at the expense of another in the name of social justice. And courts as well as quasi-judicial entities will be overrun by petitioners mouthing dubious pleas for misplaced social justice. Indeed, before there can be an occasion for compassion and mercy, there must first be justice for all. Otherwise, employees will be encouraged to steal and misappropriate in the expectation that eventually, in the name of social justice and compassion, they will not be penalized but instead financially rewarded. Verily, a contrary holding will merely encourage

lawlessness, dishonesty, and duplicity. These are not the values that society cherishes; these are the habits that it abhors

27. Art. 284 (Disease-related separation) – Villaruel vs. Guan, GR#169191 (June 1, 2011)

ROMEO VILLARUEL, PETITIONER, VS. YEO HAN GUAN, DOING BUSINESS UNDER THE NAME AND STYLE YUHANS ENTERPRISES, RESPONDENT

Facts: Petitioner filed for payment of separation pay against Yuhans

Enterprises Petitioners allegations:

o that in June 1963, he was employed as a machine operator by Ribonette Manufacturing Company, an enterprise engaged in the business of manufacturing and selling PVC pipes and is owned and managed by herein respondent Yeo Han Guan

o ver a period of almost twenty (20) years, the company changed its name four times

o Starting in 1993 up to the time of the filing of petitioner's complaint in 1999, the company was operating under the name of Yuhans Enterprises

o He remained in the employ of respondento on October 5, 1998, he got sick and was confined in a

hospitalo on December 12, 1998, he reported for work but was no

longer permitted to go back because of his illnesso he asked that respondent allow him to continue 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; however, the said amount corresponds only to the period between 1993 and 1999

petitioner prayed that he be granted separation pay computed from his first day of employment in June 1963 - respondent refused

Aside from separation pay, petitioner prayed for the payment of service incentive leave for three years

Respondent: petitioner was hired as machine operator from March 1,

1993 until he stopped working sometime in February 1999 – ground - he was suffering from illness

after his recovery, petitioner was directed to report for work, but he never showed up

Respondent was later caught by surprise when petitioner filed the instant case for recovery of separation pay

Respondent claimed that he never terminated the services of petitioner and that during their mandatory conference, he even told the latter that he could go back to work anytime but petitioner clearly manifested that he was no longer interested in returning to work and instead asked for separation pay

LA – in favor of petitioner Ordered respondents to pay separation benefits equivalent to one-

half (½) month salary per year of service, a fraction of six months equivalent to one year to herein complainant based on the complainant's length of service reckoned from June 1963 up to October 1998 as provided under Article 284 of the Labor Code, the same computed by the Computation and Examination Unit which we hereby adopt and approved (sic) as our own in the amount of NINETY-ONE THOUSAND FOUR HUNDRED FORTY-FIVE PESOS (P91,445.00); and to pay service incentive leave equivalent to fifteen days' salary in the amount of THREE THOUSAND FIFTEEN PESOS (P3,015.00).

NLRC – affirmed CA – partially granted – deleted award of separation and retained the

award for service incentive leaveISSUE: whether petitioner is entitled to separation pay under the provisions of the Labor Code and whether respondent, in fact, dismissed petitioner from his employment

Article 284 - 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: Provided, That he is paid separation pay equivalent to at least one (1) month salary or to one-half (½) month salary for every year of service whichever is greater, a fraction of at least six months being considered as one (1) whole year.

clearly presupposes that it is the employer who terminates the services of the employee 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. It does not contemplate a situation where it is the employee who severs his or her employment ties

Both lower tribunals merely concluded that petitioner is entitled to separation pay under Article 284 of the Labor Code without any explanation – no convincing justification and rationalization

Court agrees with the CA in its observation of the following circumstances as proof that respondent did not terminate petitioner's employment: first, the only cause of action in petitioner's original complaint is that he was "offered a very low separation pay"; second, there was no allegation of illegal dismissal,

both in petitioner's original and amended complaints and position paper; and, third, there was no prayer for reinstatement

Court finds that petitioner was the one who initiated the severance of his employment relations with respondent. It is evident from the various pleadings filed by petitioner that he never intended to return to his employment with respondent on the ground that his health is failing

petitioner did not ask for reinstatement. In fact, he rejected respondent's offer for him to return to work – tantamount to resignation

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 is defined as the voluntary act of an employee who finds himself in a situation where he believes that personal reasons cannot be sacrificed in favor of the exigency of the service and he has no other choice but to disassociate himself from his employment.

there is no provision in the Labor Code which grants separation pay to voluntarily resigning employees

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

Since petitioner was not terminated from his employment and, instead, is deemed to have resigned therefrom, he is not entitled to separation pay under the provisions of the Labor Code.

The court however, in a number of cases, has granted financial assistance to separated employees as a measure of social and compassionate justice and as an equitable concession. Taking into consideration the factual circumstances obtaining in the present case, the Court finds that petitioner is entitled to this kind of assistanceo Reasons: he is in the employ of respondent for more than 35

years, there is no evidence on record to show that petitioner has any derogatory record during his long years of service with respondent and that his employment was severed not by reason of any infraction on his part but because of his failing physical condition and the willingness of respondent to give him financial assistance

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

affirmed CA

28. NELSON A. CULILI v EASTERN TELECOMMUNICATIONS PHILIPPINES, INC.

Facts:

Petitioner was employed as Technician in Field Operations Department; and was promoted to Senior Technician in Service Quality Department. His basic Salary increased.

Under RA7925 and EO109, Respondent was required to establish landlines to Metro Manila and certain provinces.

Due to interconnection problems with PLDT, poor subscriptions, cancellations thereof and other business difficulties, respondent was forced to halt its roll out of 129,000 landlines already allocated to a number of its employees.

Due to business losses, respondent implemented "Right Sizing Program" (RSP) which has two phases: first, reduction of its workforce to only those necessary and which could be sustained; second, a company-wide reorganization.

In the first phase, respondent offered its employees who rendered at least 15 years of service a Special Retirement Program which comprise of the following:

o option to voluntary retire at an earlier age; ando 2.5 months' salary for every year of service

Petitioner did not avail of the package offered by the respondent In the second phase, the Service Quality Department was abolished.

Petitioner's unit was absorbed by the Business Consumer Accounts Department. This abolition rendered the petitioner's function unnecessary due to redundancy.

Respondent terminated the services of petitioner due to redundancy. Petitioner filed a complaint against respondent and its officers for

Illegal dismissal, unfair labor practice, and money claims.

ISSUE/s:

1. WON there is illegal dismissal2. WON dismissal constituted unfair labor practice3. WON there is procedural due process to as basis for the award for

nominal damages

HELD:

ILLEGAL DISMISSAL

Under the law, as a rule, an employee may be terminated for reasons involving measures taken by the employer due to installation of labor saving device, redundancy, retrenchment to prevent losses, or the cessation of operation. Except when the purpose was to circumvent the provisions of this chapter.

The requirements of a valid redundancy are the following: first, good faith of the employer in abolishing the redundant position; second, fair and reasonable criteria in ascertaining what positions are to be declared redundant, such as but not limited to: preferred status, efficiency and seniority.

In this case, respondent's being upfront with its employees about its plan to implement RSP will evidently rule out bad faith on its part. It also chose positions based on efficiency, economy, versatility and flexibility. It split the Service Quality Department into two different departments, abolished the position of Senior technician, and transferred its functions to different positions who are capable of performing the task which belonged to petitioner.

Therefore, since the respondent satisfied the requisites for valid termination due to redundancy, there was no illegal dismissal on the part of the respondent.

UNFAIR LABOR PRACTICE

Under the law, unfair labor practice are the practices of the employee, or the bargaining agent, that violates the rights of its employees to self-organization. In this case, respondent's RSP did not deprive the rights of its employees to self organization. RSP was not motivated by ill-will. Moreover, the burden of proving is from the one who alleges. Petitioner has no proof of bad faith on the part of the respondent. Therefore, there was no unfair labor practice.

DUE PROCESS

Under the case law, employer who have authorized cause to terminate employees may do so for as long as it conforms to procedural due process. Otherwise, the employer may be liable for nominal damages. In this case, redundancy is proven to be existent; and redundancy is an authorized cause for terminating an employee. However, respondent did not comply with the notice requirements. THere is no procedural due process. Hence, respondent was liable for nominal damages.

29. GENERAL MILLING CORPORATION v VIOLETA VIAJAR

FACTS:

Petitioner was gradually downsizing its VisMin operations on Cebu which led to the termination of the services of 13 employees for redundancy .

Respondent was one of the 13 employees. On Oct. 30, 2003, respondent received a Letter-Memorandum

informing her that her services were no longer needed. Effective Nov. 30, 2003.

The following day, respondent was barred from entering the premises of the respondent; and denied access to her office computer.

On Nov. 7, 2003, she was asked to sign "Application for Retirement and Benefits." Respondent refused.

The respondent hired 15 new employees. Respondent filed for Illegal dismissal and damages.

ISSUE:

WON there was redundancy

HELD:

Under Art 283 of the Labor Code, redundancy was one of the authorized causes for dismissal. Factors which indicates redundancy were the following: over hiring of workers, decreased volume of business, and dropping of product line or service activity previously manufactured or undertaken by the enterprise. Moreover, determination whether a particular position is redundant is an exercise of business judgment on the part of the employer. Except, if it violates the law, arbitrary or malicious. It should also be based on evidence to substantiate redundancy.

In this case, the proof submitted by the petitioner were insufficient to terminate the respondent for redundancy. It did not submitted proof of business slowdown. Moreover, respondent substantiated the proof that the petitioner hired several employees after the prior employees were laid off. Further, the demand for her to sign the "Application for Retirement and Benefits" also contravenes the fact that she was terminated due to redundancy.

Therefore, there was no valid redundancy to speak of. Respondent was illegally dismissed.