[G.R. No. 182848 : October 05, 2011]

EMIRATE SECURITY AND MAINTENANCE SYSTEMS, INC. AND ROBERTO A. YAN, PETITIONERS, VS. GLENDA M. MENESE, RESPONDENT.

On June 5, 2001, respondent Glenda M. Menese (Menese) filed a

complaint for constructive dismissal; illegal reduction of salaries

and allowances; separation pay; refund of contribution to cash

bond; overtime, holiday, rest day and premium pay; damages;

and attorney’s fees against the petitioners, Emirate Security and

Maintenance Systems, Inc. (agency) and its General Manager,

Robert A. Yan (Yan).

 

          Menese alleged in the compulsory arbitration proceedings

that on April 1, 1999, the agency engaged her services as payroll

and billing clerk. She was assigned to the agency’s security

detachment at the Philippine General Hospital (PGH). She was

given a monthly salary of P9,200.00 and an allowance of

P2,500.00, for a total of P11,700.00 in compensation. Effective

May 2001, her allowance was allegedly reduced to P1,500.00

without notice, and P100.00 was deducted from her salary every

month as her contribution to a cash bond which lasted throughout

her employment. She was required to work seven (7) days a

week, from 8:00 a.m. to 5:00 p.m.  She was also required to

report for work on holidays, except on New Year’s Day and

Christmas. She claimed that she was never given overtime,

holiday, rest day and premium pay.

 

          Menese further alleged that on May 4, 2001, she started

getting pressures from the agency for her to resign from her

position because it had been committed to a certain Amy Claro, a

protégée of Mrs. Violeta G. Dapula (Dapula) the new chief of the

Security Division of the University of the Philippines (UP) Manila

and PGH.  Menese raised the matter with Yan who told her that

the agency was in the process of establishing goodwill with

Dapula, so it had to sacrifice her position to accommodate

Dapula’s request to hire Claro.

 

          Menese claimed that she was told not to worry because if

she was still interested in working with the agency, she could still

be retained as a lady guard with a salary equivalent to the

minimum wage. She would then be detailed to another

detachment because Dapula did not like to see her around

anymore.  If the offer was acceptable to her, she should report to

the agency’s personnel officer for the issuance of the necessary

duty detail order.  Menese thought about the offer and soon

realized that  she was actually being demoted in rank and salary.

She eventually decided to decline the offer. She continued

reporting to the PGH detachment and performed her usual

functions as if nothing happened.

 

          Menese alleged that at this juncture, Claro reported at the

agency’s PGH detachment and performed the functions she was

doing. She bewailed that thereafter she continuously received

harassment calls and letters. She was also publicly humiliated

and badly treated at the detachment. The agency, through

Security Officer Alton Acab, prohibited her from using the office

computer.  On May 18, 2001, Jose Dante Chan, the agency’s

PGH detachment commander, arrogantly told her to leave PGH.

Again on May 25, 2001, Chan shouted at her and told her to pack

her things and to leave immediately, and not to return to the

detachment anymore; otherwise, she would be physically driven

out of the office.

 

          Still not satisfied with what they did, the petitioners

allegedly withheld her salary for May 16-31, 2001. She claimed

that the petitioners dismissed her from the service without just

cause and due process.

 

          The petitioners, for their part, denied liability. They alleged

that on May 8, 2001, Dapula informed the agency in writing,

through Yan, that she had been receiving numerous complaints

from security guards and other agency employees about

Menese’s unprofessional conduct. She told the petitioners that

she was not tolerating Menese’s negative work attitude despite

the fact that she is the wife of Special Police Major Divino Menese

who is a member of the UP Manila police force, and that as a

matter of policy and out of delicadeza, she does not condone

nepotism in her division.

 

          On the basis of Dapula’s letter, Yan sent Menese a

memorandum dated May 16, 2001, instructing her to report to the

agency’s head office and, there and then, discussed with her

Dapula’s letter. Yan informed Menese that upon Dapula’s request,

she would be transferred to another assignment which would not

involve any demotion in rank or diminution in her salary and other

benefits. Although Menese said that she would think about the

matter, the petitioners were surprised to receive summons from

the labor arbiter regarding the complaint.

Whether or not there has been illegal dismissal

Whether or not overtime pay may be awarded

Yes.   As Menese noted, the petitioners did not submit as annex to the petition Yan’s letter to Dapula, and the reason appears to be obvious — they were trying to avoid calling attention to the absence of proof of Menese’s alleged unprofessionalism and her involvement in nepotism. Evidently, the basis for Dapula’s request did not exist. We thus find credible Menese’s contention that her transfer was a ploy to remove her from the PGH detachment to accommodate the entry of Dapula’s protégée. In short, the agency wanted to create a vacancy for Claro, the protégée.  Confronted with this clear intent of the petitioners, we cannot see how Menese’s transfer could be considered a valid exercise of management prerogative. As Menese rightly put it, her transfer was arbitrarily done, motivated no less by ill will and bad faith. 

No. In Global Incorporated v. Commissioner Atienza, a claim for overtime pay will not be granted for want of factual and legal basis. In this respect, the records indicate that the labor arbiter

granted Menese’s claim for holiday pay, rest day and premium pay on the basis of payrolls.  There is no such proof in support of Menese’s claim for overtime pay other than her contention that she worked from 8:00 a.m. up to 5:00 p.m.  She presented no evidence to show that she was working during the entire one hour meal break. We thus find the NLRC’s deletion of the overtime pay award in order.

[G.R. No. 195033 : October 12, 2011]

AGG TRUCKING AND/OR ALEX ANG GAEID, PETITIONERS, VS. MELANIO B. YUAG, RESPONDENT.

The facts of the case are simple. Petitioner Alex Ang Gaeid had

employed respondent Melanio Yuag as a driver since 28 February

2002.  He alleged that he had a trucking business, for which he

had 41 delivery trucks  driven by 41 drivers, one of whom was

respondent.   His clients were Busco Sugar Milling Co., Inc.,

operating in Quezon, Bukidnon; and Coca-cola Bottlers Company

in Davao City and Cagayan de Oro City.  Respondent received

his salary on commission basis of 9% of his gross delivery per

trip.  He was assigned to a ten-wheeler truck and was tasked to

deliver sacks of sugar from the Busco Sugar Mill to the port of

Cagayan de Oro.  Petitioner noticed that respondent had started

incurring substantial shortages since 30 September 2004, when

he allegedly had a shortage of 32 bags, equivalent to ₱48,000;

followed by 50 bags, equivalent to ₱75,000, on 11 November

2004.  It was also reported that he had illegally sold bags of sugar

along the way at a lower price, and that he was banned from

entering the premises of the Busco Sugar Mill.  Petitioner asked

for an explanation from respondent who remained quiet.

         Alarmed at the delivery shortages, petitioner took it upon

himself to monitor all his drivers, including respondent, by

instructing them to report to him their location from time to time

through their mobile phones.  He also required them to make their

delivery trips in convoy, in order to avoid illegal sale of cargo

along the way.

         Respondent, along with 20 other drivers, was tasked to

deliver bags of sugar from Cagayan de Oro City to Coca-Cola

Bottlers Plant in Davao City on 4 December 2004.  All drivers,

with the exception of Yuag who could not be reached through his

cellphone, reported their location as instructed.  Their reported

location gave evidence that they were indeed in convoy. 

Afterwards, everyone, except Yuag, communicated that the

delivery of their respective cargoes had been completed.  The

Coca-Cola Plant in Davao later reported that the delivery had a

suspiciously enormous shortage.   

        

Respondent reported to the office of the petitioner on 6

December 2004.  Allegedly in a calm and polite manner, petitioner

asked respondent to explain why the latter had not contacted

petitioner for two days, and he had  not gone in convoy with the

other trucks, as he was told to do.  Respondent replied that the

battery of his cellphone had broken down.  Petitioner then

confronted him allegedly still in a polite and civilized  manner,

regarding the large shortages, but the latter did not answer. 

Petitioner afterwards told him to “just take a  rest” or, in their

vernacular, “pahulay lang una.”  This exchange started the

dispute since respondent construed it as a dismissal.  He

demanded that it be done in writing, but petitioner merely

reiterated that respondent should just take a rest in the

meanwhile.  The former alleged that respondent had offered to

resign and demanded separation pay.  At that time, petitioner

could not grant the demand, as it would entail computation which

was the duty of the cashier.  Petitioner asked him to come back

the next day.

         Instead of waiting for another day to go back to his

employer, Respondent went to the Department of Labor-Regional

Arbitration Board X, that very day of the confrontation or on 6

December 2004. There he filed a Complaint for illegal dismissal,

claiming his separation pay and 13th month pay.  Subsequently,

after the delivered goods to the Coca-Cola Plant were weighed on

9 December 2004, it was found out that there was a shortage of

111 bags of sugar, equivalent to ₱166,000.

         Respondent argued that he was whimsically dismissed, just

because he had not been able to answer his employer's call

during the time of the delivery.  His reason for not answering was

that the battery pack of his cellphone had broken down.  Allegedly

enraged by that incident, his employer, petitioner herein,

supposedly shouted at him and told him,  “pahuway naka.”  When

he asked for a clarification, petitioner allegedly told him, “wala nay

daghan istorya, pahulay na!” This statement was  translated by

the CA thus: “No more talking! Take a rest!”  He then realized that

he was being dismissed.  When he asked for his separation pay,

petitioner refused.  Respondent thus filed a Complaint for illegal

dismissal.

Whether or not employee is a regular employee

Whether or not there was a valid dismissal

Yes.  It is most disturbing to see how the CA regarded labor terms “paid on commission,” “pakyaw” and “seasonal worker” as one and the same.  In labor law, they are different and have distinct meanings, which we do not need to elaborate on in this Petition as they are not the issue here.  It should also be remembered that a regular status of employment is not based on how the salary is paid to an employee.  An employee may be paid purely on commission and still be considered a regular employee.  Moreover, a seasonal employee may also be considered a regular employee. 

No.   Further, the appreciation by the CA of the NLRC Resolution

was erroneous.  The fact is that the refusal by the NLRC to grant

separation pay was merely consistent with its ruling that there

was no dismissal.   Since respondent was not dismissed, much

less illegally dismissed,  separation pay was unnecessary.  The

CA looked at the issue differently and erroneously, as it held that

the NLRC refused to grant the award of separation pay because

respondent had not been found to be a regular employee.  The

NLRC had in fact made no such ruling.  These are flagrant errors

that are reversible by this

Court.  They should be corrected for the sake not only of the

litigants, but also of the CA, so that it would become more

circumspect in its appreciation of the records before it.          

         We reviewed the NLRC Resolution that reversed the LA

Decision and found nothing in it that was whimsical, unreasonable

or patently violative of the law.  It was the CA which erred in

finding faults that were inexistent in the NLRC Resolution.

[G.R. No. 195419 : October 12, 2011]

PEOPLE OF THE PHILIPPINES, PLAINTIFF-APPELLEE, VS. HADJA JARMA LALLI Y PURIH, RONNIE ARINGOY Y MASION, AND NESTOR RELAMPAGOS (AT LARGE), ACCUSED.

HADJA JARMA LALLI Y PURIH AND RONNIE ARINGOY Y MASION, ACCUSED-APPELLANTS.

In the evening of June 3, 2005, while Lolita Sagadsad Plando, 23 years old, single, was in Tumaga, Zamboanga City on her way to the house of her grandfather, she met Ronnie Masion Aringoy and Rachel Aringoy Cañete. Ronnie

greeted Lolita, “Oy, it’s good you are here” (“oy, maayo kay dia ka”). Rachel asked Lolita if she is interested to work in Malaysia. x x x Lolita was interested so she gave her cellphone number to Ronnie. After their conversation, Lolita proceeded to her grandfather’s house.

 

x x x

 

On June 4, 2005, at about 7:00 o’clock in the morning, Lolita received a text message from Ronnie Aringoy inviting her to go to the latter’s house. At 7:30 in the morning, they met at Tumaga on the road near the place where they had a conversation the night before. Ronnie brought Lolita to the house of his sister in Tumaga. Lolita inquired what job is available in Malaysia. Ronnie told her that she will work as a restaurant entertainer. All that is needed is a passport. She will be paid 500 Malaysian ringgits which is equivalent to P7,000.00 pesos in Philippine currency. Lolita told Ronnie that she does not have a passport. Ronnie said that they will look for a passport so she could leave immediately. Lolita informed him that her younger sister, Marife Plando, has a passport. Ronnie chided her for not telling him immediately. He told Lolita that she will leave for Malaysia on June 6, 2005 and they will go to Hadja Jarma Lalli who will bring her to Malaysia. Ronnie sent a text message to Lalli but the latter replied that she was not in her house. She was at the city proper.

 

On June 5, 2005, at about 6:00 o’clock in the evening, Ronnie Aringoy and Rachel Aringoy Cañete arrived on board

a tricycle driven by Ronnie at the house where Lolita was staying at Southcom Village. Ronnie asked if Lolita already had a passport. Lolita said that she will borrow her sister’s passport. Ronnie, Rachel and Lolita went to Buenavista where Lolita’s other sister, Gina Plando was staying. Her sister Marife Plando was there at that time. Lolita asked Marife to let her use Marife’s passport. Marife refused but Lolita got the passport. Marife cried. Ronnie, Rachel and Lolita proceeded to Tumaga. Ronnie, Rachel and Lolita went to the house of Hadja Jarma Lalli just two hundred meters away from the house of Ronnie in Tumaga. Ronnie introduced Lolita to Hadja Jarma, saying “Ji, she is also interested in going to Malaysia.” Lolita handed a passport to Hadja Jarma telling her that it belongs to her sister Marife Plando. Hadja Jarma told her it is not a problem because they have a connection with the DFA (Department of Foreign Affairs) and Marife’s picture in the passport will be substituted with Lolita’s picture. Nestor Relampagos arrived driving an owner-type jeep. Hadja Jarma introduced Nestor to Lolita as their financier who will accompany them to Malaysia. x x x Lolita noticed three other women in Hadja Jarma’s house. They were Honey, about 20 years old; Michele, 19 years old, and another woman who is about 28 years old. The women said that they are from Ipil, Sibugay Province. Ronnie told Lolita that she will have many companions going to Malaysia to work. They will leave the next day, June 6, and will meet at the wharf at 2:30 in the afternoon.

 

On June 6, 2005, Lolita went to Zamboanga City wharf at 2:00 o’clock in the afternoon bringing a bag containing her make-up and powder. She met at the wharf Hadja Jarma Lalli, Ronnie Aringoy, Honey and Michele. Ronnie gave to

Lolita her boat ticket for the vessel M/V Mary Joy bound for Sandakan, Malaysia; a passport in the name of Marife Plando but with Lolita’s picture on it, and P1,000.00 in cash. Hadja Jarma, Lolita, Honey, Michele and two other women boarded the boat M/V Mary Joy bound for Sandakan. Ronnie Aringoy did not go with them. He did not board the boat. x x x After the boat sailed, Hadja Jarma Lalli and Nestor Relampagos approached Lolita and her companions. Nestor told them that they will have a good job in Malaysia as restaurant entertainers. They will serve food to customers. They will not be harmed.

 

M/V Mary Joy arrived at the port of Sandakan, Malaysia at 10:00 o’clock in the morning of June 7, 2005. After passing through the immigration office, Hadja Jarma Lalli, Nestor Relampagos, Lolita, Honey, Michele and two other women boarded a van for Kota Kinabalu. x x x At the hotel, Nestor Relampagos introduced to Lolita and her companions a Chinese Malay called “Boss” as their employer. After looking at the women, “Boss” brought Lolita, Honey, Diane and Lorraine to a restaurant near the hotel. Diane and Lorraine were also on baord M/V Mary Joy when it left the port of Zamboanga for Sandakan on June 6, 2005. When they were already at the restaurant, a Filipina woman working there said that the place is a prostitution den and the women there are used as prostitutes. Lolita and her companions went back to the hotel. They told Hadja Jarma and Nestor that they do not like to work as prostitutes. x x x After about five minutes, another person called “boss” arrived. x x x [T]hey were fetched by a van at about 7:00 o’clock in the evening and brought to Pipen Club owned by “Boss Awa”, a Malaysian. At the club, they were told that they owe the club 2,000 ringgits each as payment for the amount given by the

club to Hadja Jarma Lalli and Nestor Relampagos. They will pay for the said amount by entertaining customers. The customers will pay 300 ringgits for short time services of which 50 ringgits will go to the entertainer, and 500 ringgits for over night service of which 100 ringgits will be given to the entertainer. Pipen Club is a big club in a two-storey building. There were about 100 women working in the club, many of them were Filipina women.

 

Lolita Plando was forced to work as entertainer at Pipen Club. She started working at 8:30 in the evening of June 14, 2005. She was given the number 60 which was pinned on her. That night, she had her first customer who selected her among the other women at the club. He was a very big man, about 32 years old, a Chinese-Malay who looked like a wrestler. The man paid for short time service at the counter. Lolita was given by the cashier a small pink paper. She was instructed to keep it. A small yellow paper is given to the entertainer for overnight services. The customer brought Lolita to a hotel. She did not like to go with him but a “boss” at the club told her that she could not do anything. At the hotel, the man poked a gun at Lolita and instructed her to undress. She refused. The man boxed her on the side of her body. She could not bear the pain. The man undressed her and had sexual intercourse with her. He had sexual intercourse with her every fifteen minutes or four times in one hour. When the customer went inside the comfort room, Lolita put on her clothes and left. The customer followed her and wanted to bring her back to the hotel but Lolita refused. At about 1:00 o’clock in the morning of June 15, 2005, Lolita was chosen by another customer, a tall dark man, about 40 years old. The customer paid for an overnight service at the counter and brought Lolita to Mariner Hotel which is far from

Pipen Club. At the hotel, the man told Lolita to undress. When she refused, the man brought her to the comfort room and bumped her head on the wall. Lolita felt dizzy. The man opened the shower and said that both of them will take a bath. Lolita’s clothes got wet. She was crying. The man undressed her and had sexual intercourse with her. They stayed at the hotel until 11:00 o’clock in the morning of June 15, 2005. The customer used Lolita many times. He had sexual intercourse with her every hour.

 

Lolita worked at Pipen Club from June 14 to July 8, 2005. Every night, a customer used her. She had at least one customer or more a night, and at most, she had around five customers a night. They all had sexual intercourse with her. On July 9, 2005, Lolita was able to contact by cellphone at about 10:00 o’clock in the morning her sister Janet Plando who is staying at Sipangkot Felda x x x. Janet is married to Said Abubakar, an Indonesian national who is working as a driver in the factory. x x x Lolita told Janet that she is in Labuan, Malaysia and beg Janet to save her because she was sold as a prostitute. Janet told Lolita to wait because her husband will go to Pipen Club to fetch Lolita at 9:00 o’clock that evening of that day. x x x She told Janet to instruct her husband to ask for No. 60 at Pipen Club. x x x At 9:00 o’clock in the evening, Lolita was told by Daddy Richard, one of the bosses at the club, that a customer requested for No. 60. The man was seated at one of the tables. Lolita approached the man and said, “good evening.” The man asked her is she is the sister of Janet Plando. Lolita replied that she is, and asked the man if he is the husband of her sister. He said, “yes.” The man had already paid at the counter. He stood up and left the place. Lolita got her wallet and followed him. x x x Lolita told her sister about her ordeal.

She stayed at her sister’s house until July 22, 2005. On July 21, 2005 at 7:00 o’clock in the evening, a policeman went to her sisters house and asked if there is a woman staying in the house without a passport. Her sister told the policeman that she will send Lolita home on July 22. At dawn on July 22, Lolita and her brother-in-law took a taxi from Sipangkot Felda to Mananamblas where Lolita will board a speedboat to Sibuto, Tawi-Tawi. x x x

 

Upon arrival in Zamboanga City on July 24, 2005, Lolita went directly to the house of her eldest sister Alejandra Plando Maywila at Sta. Catalina, Zamboanga City. She left her things at her sister’s house and immediately went to the sister of Ronnie Aringoy in Tumaga. Ronnie was not there. She asked Russel, niece of Ronnie, to call for the latter. Ronnie arrived and said to her, “so you are here, you arrived already.” He said he is not involved in what happened to her. Lolita asked Ronnie to accompany her to the house of Nestor Relampagos because she has something to get from him. Ronnie refused. He told Lolita not to let them know that she had already arrived from Malaysia.

Whether or not there has been illegal recruitment

Yes. It is clear that a person or entity engaged in recruitment and placement activities without the requisite authority from the Department of Labor and Employment (DOLE), whether for profit or not, is engaged in illegal recruitment.39 The Philippine

Overseas Employment Administration (POEA), an agency under DOLE created by Executive Order No. 797 to take over the duties of the Overseas Employment Development Board, issues the authority to recruit under the Labor Code. The commission of illegal recruitment by three or more persons conspiring or confederating with one another is deemed committed by a syndicate and constitutes economic sabotage,40 for which the penalty of life imprisonment and a fine of not less than ₱500,000 but not more than ₱1,000,000 shall be imposed.41

 

The penalties in Section 7 of RA 8042 have already been amended by Section 6 of Republic Act No. 10022, and have been increased to a fine of not less than ₱2,000,000 but not more than ₱5,000,000. However, since the crime was committed in 2005, we shall apply the penalties in the old law, RA 8042.

 

In People v. Gallo,42 the Court enumerated the elements of syndicated illegal recruitment, to wit:

 

1.      the offender undertakes either any activity within the meaning of “recruitment and placement” defined under Article 13(b), or any of the prohibited practices enumerated under Art. 34 of the Labor Code;

2.      he has no valid license or authority required by law to enable one to lawfully engage in recruitment and placement of workers; and

 

3.      the illegal recruitment is committed by a group of three (3) or more persons conspiring or confederating with one another.43

Article 13(b) of the Labor Code of the Philippines defines recruitment and placement as “any act of canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring workers, and includes referrals, contract services, promising or advertising for employment, locally or abroad, whether for profit or not, provided, that any person or entity which, in any manner, offers or promises for a fee, employment to two or more persons shall be deemed engaged in recruitment and placement.”

Clearly, given the broad definition of recruitment and placement, even the mere act of referring someone for placement abroad can be considered recruitment. Such act of referral, in connivance with someone without the requisite authority or POEA license, constitutes illegal recruitment. In its simplest terms, illegal recruitment is committed by persons who, without authority from the government, give the impression that they have the power to send workers abroad for employment purposes.44

In this case, the trial court, as affirmed by the appellate court, found Lalli, Aringoy and Relampagos to have conspired and confederated with one another to recruit and place Lolita for work in Malaysia, without a POEA license. The three elements of syndicated illegal recruitment are present in this case, in particular: (1) the accused have no valid license or authority required by law to enable them to lawfully engage in the recruitment and placement of workers; (2) the accused engaged in this activity of recruitment and placement by actually recruiting, deploying and transporting Lolita to Malaysia; and (3) illegal recruitment was committed by three persons (Aringoy, Lalli and Relampagos), conspiring and confederating with one another.

 

Aringoy claims and admits that he only referred Lolita to Lalli for job opportunities to Malaysia. Such act of referring, whether for profit or not, in connivance with someone without a POEA license, is already considered illegal recruitment, given the broad definition of recruitment and placement in the Labor Code.

Lalli, on the other hand, completely denies any involvement in the recruitment and placement of Lolita to Malaysia, and claims she only met Lolita for the first time by coincidence on board the ship M/V Mary Joy. Lalli’s denial does not deserve credence because it completely conflicts with the testimony of Aringoy who claims he referred Lolita to Lalli who had knowledge of the job opportunities in Malaysia.

 

The conflicting testimonies of Lalli and Aringoy on material facts give doubt to the truth and veracity of their stories, and strengthens the credibility of the testimony of Lolita, despite allegations of irrelevant inconsistencies.

 

No improper motive could be imputed to Lolita to show that she would falsely testify against the accused. The absence of evidence as to an improper motive entitles Lolita’s testimony to full faith and credit.45

Aringoy claims that no conspiracy existed in illegal recruitment, as he denies even knowing Relampagos, who is currently at-large. Lalli denies any involvement in the illegal recruitment, and claims that she only met Relampagos through Lolita on board the ship M/V Mary Joy on 6 June 2005, and learned that Relampagos was bringing Lolita and their other girl companions to Malaysia to work as sales ladies.

[G.R. No. 176884 : October 19, 2011]

CARMELITO N. VALENZONA, PETITIONER, VS. FAIR SHIPPING CORPORATION AND/OR SEJIN LINES COMPANY LIMITED, RESPONDENTS.

On May 5, 2001, respondent Fair Shipping Corporation, for and on

behalf of its principal, respondent Sejin Lines Company Limited, hired

petitioner as 2nd Assistant Engineer aboard its vessel M/V Morelos for

a duration of nine months. Before his embarkation on May 23, 2001,

he was declared medically “fit to work.”

 

            However, while aboard the vessel on September 29, 2001,

petitioner complained of chest pain.  He was thus brought to Centro

Medico Quirurgico Echauri in Mexico where he was confined up to

October 6, 2001 and diagnosed with “hypertensive crisis, high blood

pressure.”   

 

            A day after his repatriation to the Philippines on October 8,

2001, petitioner was examined by Dr. Nicomedes G. Cruz (Dr. Cruz),

the company-designated physician who diagnosed his illness as

hypertension. Dr. Cruz continuously treated petitioner for six months,

i.e., from October 9, 2001 until April 25, 2002.

 

            On April 18, 2002, however, petitioner consulted another

doctor, a certain Dr. Mapapala at the Jose Reyes Memorial Medical

Center who diagnosed him with “Hypertensive Cardiovascular

Disease”.  Considering his prolonged sickness, petitioner, on April 18,

2002, through Atty. Anastacio P. Marcelo, wrote a letter to

respondents demanding payment of the balance of his sickness

allowance and permanent disability benefits.  However, same went

unheeded.

 

            Thereafter, or on April 25, 2002, Dr. Cruz issued a certification

declaring petitioner as fit to work. 

 

            Unconvinced, on April 27, 2002, petitioner consulted Dr.

Rodrigo F. Guanlao, an Internist-Cardiologist at the Philippine Heart

Center who diagnosed him with “Ischemic heart disease,

Hypertensive cardiovascular disease and congestive heart failure”

and also declared him unfit to work in any capacity. 

 

            Hence, petitioner filed a complaint for recovery of disability

benefits, sickness allowance, attorney's fees and moral damages.

 

Whether or not petitioner is entitled to disability benefits

Yes. Petitioner’s Employment Contract specifically provides that

the same shall be deemed an “integral part of the Standard Terms

and Conditions Governing the Employment of Filipino Seafarers On

Board Ocean-Going Vessels” otherwise known as the POEA

Standard Employment Contract.  Section 20(B) of the POEA

Standard Employment Contract provides:  

 

B. COMPENSATION AND BENEFITS FOR INJURY OR ILLNESS x x x x 3. Upon sign-off from the vessel for medical treatment, the seafarer is entitled to sickness allowance equivalent to his basic wage until he is declared fit to work or the degree of permanent disability has been assessed by the company-designated physician but in no case shall this period exceed one hundred twenty (120) days. 

x x x x

 

            The Labor Code's provision on permanent total disability

applies with equal force to seafarers.  Article 192 (c) (1) of the Labor

Code provides, viz;

 

         Art. 192.  Permanent total disability. - x x x                x x x x                              

(c)          The following disabilities shall be deemed total and permanent:

 (1)         Temporary total disability lasting

continuously for more than one hundred twenty days, except as otherwise provided for in the Rules;

 x x x x

           

           

            Thus, in Quitoriano v. Jebsens Maritime, Inc., we held that:

 

         Thus, Court has applied the Labor Code concept of permanent total disability to the case of seafarers. x x x

                x x x x                There are three kinds of disability benefits under the Labor Code, as amended by P.D. No. 626:  (1) temporary total disability, (2) permanent total disability, and (3) permanent partial disability. Section 2, Rule VII of the Implementing Rules of Book V of the Labor Code differentiates the disabilities as follows: 

Sec. 2. Disability. - (a) A total disability is temporary if as a result of the injury or sickness the employee is unable to perform any gainful occupation for a continuous period not exceeding 120 days, except as otherwise provided for in Rule X of these Rules.

 (b)   A disability is total and permanent if as

a result of the injury or sickness the employee is unable to perform any gainful occupation for a continuous period exceeding 120 days, except as otherwise provided for in Rule X of these Rules.

 (c)  A disability is partial and permanent if

as a result of the injury or sickness the employee suffers a permanent partial loss of the use of any part of his body.

                In Vicente v. ECC (G.R. No. 85024, January 23, 1991, 193 SCRA 190, 195): 

x x x the test of whether or not an employee suffers from 'permanent total disability' is a showing of the capacity of the employee to

continue performing his work notwithstanding the disability                 he incurred.  Thus, if by reason of the injury or sickness he sustained, the employee is unable to perform his customary job for more than 120 days and he does not come within the coverage of Rule X of the Amended Rules on Employees Compensability (which, in more detailed manner, describes what constitutes temporary total disability), then the said employee undoubtedly suffers from 'permanent total disability' regardless of whether or not he loses the use of any part of his body.

                A total disability does not require that the employee be absolutely disabled or totally paralyzed.  What is necessary is that the injury must be such that the employee cannot pursue his usual work and earn therefrom (Austria v. Court of Appeals, G.R. No. 146636, Aug. 12, 2002, 387 SCRA 216, 221).  On the other hand, a total disability is considered permanent if it lasts continuously for more than 120 days. Thus, in the very recent case of Crystal Shipping, Inc. v. Natividad (G.R. No. 134028, December 17, 1999, 321 SCRA 268, 270-271), we held:                Permanent disability is inability of a worker to perform his job for more than 120 days, regardless of whether or not he lose[s] the use of any part of his body. x x x                Total disability, on the other hand, means the disablement of an employee to earn wages in the same kind of work of similar nature that he was trained for, or accustomed to perform, or any kind of work which a

person of his mentality and attainments could do.  It does not mean absolute helplessness.  In disability compensation, it is not the injury which is compensated, but rather it is the incapacity to work resulting in the impairment of one's earning capacity.

 

 

            In Quitoriano, the seafarer therein was medically repatriated

to the Philippines on May 30, 2001 and upon arrival, he underwent

several tests at the Medical Center Manila under the care of Dr. Cruz,

the company-designated physician, who incidentally is the same Dr.

Cruz who treated petitioner in the instant case.  After a lapse of 169

days from his repatriation, or on November 16, 2001, Dr. Cruz

declared the seafarer therein fit to work.  Unconvinced, the seafarer

consulted an independent internist-cardiologist who diagnosed him as

suffering from “hypertension cardiovascular disease and

hyperlipidemia”.  The seafarer thus demanded from the shipping

company payment of his permanent disability benefits but he was

rebuffed on the ground that he was declared fit to work by Dr. Cruz. 

The seafarer thus filed a complaint to recover his permanent

disability benefits and attorney's fees. The case eventually reached

this Court raising the issue of whether the CA erred in not finding the

disability of the seafarer as permanent and total and for not awarding

him attorney's fees.  The Court ruled in favor of the seafarer holding

that “the fact that it was only on November 16, 2001 that the 'fit to

work' certification was issued by Dr. Cruz or more than five months

from the time petitioner was medically repatriated on May 30, 2001,

petitioner's disability is considered permanent and total.” 

 

            The ruling in Quitoriano applies in the instant case.  Similarly,

petitioner herein was medically repatriated to the Philippines on

October 8, 2001.  However, it was only on April 25, 2002 or after a

lapse of 199 days that Dr. Cruz issued a certification declaring him fit

to work. Thus, we declare herein, just as we pronounced in

Quitoriano, that petitioner’s disability is considered permanent and

total because the “fit to work” certification was issued by Dr. Cruz only

on April 25, 2002, or more than 120 days after he was medically

repatriated on October 8, 2001.

[G.R. Nos. 191138-39 : October 19, 2011]

MAGDALA MULTIPURPOSE & LIVELIHOOD COOPERATIVE AND SANLOR MOTORS CORP., PETITIONERS, VS. KILUSANG MANGGAGAWA NG LGS, MAGDALA MULTIPURPOSE & LIVELIHOOD CORPERATIVE (KMLMS)

AND UNION MEMBERS/ STRIKERS, NAMELY: THOMAS PADULLON, HERBERT BAUTISTA, ARIEL DADIA, AVELINO PARENAS, DENNIS MONTEALEGRE, SONNY CONSTANTINO, SHANDY CONSTANTINO, JOSEPH PERNIA, PETER ALCOY, EDILBERTO CERILLE, FERNANDO LEONOR, TEOTIMAR REGINIO, ALBERTO BAJETA, ALLAN MENESES, RONEL FABUL, JESUS COMENDADOR, JERRY PERNIA, OSCAR RIVERA, LEO MELGAR, ENRICO LAYGO, RICKY PALMERO, ROWELL GARCIA, LEOPITO MERANO, ALEJANDRO DE LARA, JOEL GARCIA, BONIFACIO PEREDA, REMEGIO CONSTANTINO, DICKSON PILAPIL, RANDY CORDANO, DARIUS PILAPIL, VENICE LUCERO, GREGORIO REANZARES, EULOGIO REGINIO, MICHAEL JAVIER, DENNIS MOSQUERA, FREDDIE AZORES, ROGELIO CABRERA, AURELIO TAGUINOD, OSCAR TAGUINOD, DEWELL PILAPIL, JOEL MAS-ING, EDUARDO LOPEZ, GLICERIO REANZAREZ, JOSEPH FLORES,BUENATO CASAS, ROMEO AZAGRA, ALFREDO ROSALES, ESTELITO BAJETA, PEDY GEMINA, FERNANDO VELASCO, ALBERTO CANEZA, ALEJANDRO CERVANTES, ERICK CARVAJAL, RONALDO BERNADEZ, JERRY COROSA, JAYSON COROSA, JAYSON JUANSON, SHELLY NAREZ, EDGARDO GARCIA, ARIEL LLOSALA, ROMMEL ILAYA, RODRIGO PAULETE, MERVIN PANGUINTO, MARVIN SENATIN, JAYSON RILLORA, RAFAEL SARMIENTO, FREDERICK PERMEJO, NICOLAS BERNARDO, LEONCIO PAZ DE LEON, EDWARD DENNIS MANAHAN, ANTONIO BALDAGO, ALEXANDER BAJETA, RESPONDENTS.

Respondent Kilusang Manggagawa ng LGS, Magdala

Multipurpose and Livelihood Cooperative (KMLMS) is the union

operating in Magdala Multipurpose & Livelihood Cooperative and

Sanlor Motors Corp.

 

KMLMS filed a notice of strike on March 5, 2002 and

conducted its strike-vote on April 8, 2002. However, KMLMS only

acquired legal personality when its registration as an independent

labor organization was granted on April 9, 2002 by the

Department of Labor and Employment under Registration No.

RO-400-200204-UR-002.  On April 19, 2002, it became officially

affiliated as a local chapter of the Pambansang Kaisahan ng

Manggagawang Pilipino when its application was granted by the

Bureau of Labor Relations.

 

Thereafter, on May 6, 2002, KMLMS––now a legitimate

labor organization (LLO)––staged a strike where several

prohibited and illegal acts were committed by its participating

members.  

 

On the ground of lack of valid notice of strike, ineffective

conduct of a strike-vote and commission of prohibited and illegal

acts, petitioners filed their Petition to Declare the Strike of May 6,

2002 Illegal before the NLRC Regional Arbitration Board (RAB)

No. IV in Quezon City, docketed as NLRC RAB IV-9-1265-02-R. 

In their petition, as well as their Position Paper, petitioners

prayed, inter alia, that the officers and members of respondent

KMLMS who participated in the illegal strike and who knowingly

committed prohibited and illegal activities, respectively, be

declared to have lost or forfeited their employment status.

Whether or not THE COURT OF APPEALS ERRED IN REFUSING TO SIMILARLY DECLARE AS HAVING LOST THEIR EMPLOYMENT STATUS THE REST OF THE UNION STRIKERS WHO HAVE PARTICIPATED IN THE ILLEGAL STRIKE AND COMMITTED PROHIBITED/ILLEGAL ACTS, TO THE PREJUDICE OF PETITIONERS[’] BUSINESS OPERATIONS.

 

No. the CA is correct. There is no question that the May 6,

2002 strike was illegal, first, because when KMLMS filed the

notice of strike on March 5 or 14, 2002, it had not yet acquired

legal personality and, thus, could not legally represent the

eventual union and its members.  And second, similarly when

KMLMS conducted the strike-vote on April 8, 2002, there was still

no union to speak of, since KMLMS only acquired legal

personality as an independent LLO only on April 9, 2002 or the

day after it conducted the strike-vote.  These factual findings are

undisputed and borne out by the records.

 

Consequently, the mandatory notice of strike and the

conduct of the strike-vote report were ineffective for having been

filed and conducted before KMLMS acquired legal personality as

an LLO, violating Art. 263(c), (d) and (f) of the Labor Code and

Rule XXII, Book V of the Omnibus Rules Implementing the Labor

Code.  The Labor Code provisos pertinently provide:

 

ART. 263.  Strikes, Picketing and Lockouts. — (a)  x x x

 (c)  In case of bargaining deadlocks, the duly

certified or recognized bargaining agent may file a notice of strike or the employer may file a notice of lockout with the Ministry at least 30 days before the intended date thereof.  In case of unfair labor practice, the period of notice shall be 15 days and in absence of a duly certified or recognized bargaining agent, the notice of strike may be filed by any legitimate labor organization in behalf of its members.  However, in

case of dismissal from employment of union officers duly elected in accordance with the union constitution and by-laws, which may constitute union busting, where the existence of the union is threatened, the 15-day cooling-off period shall not apply and the union may take action immediately.  (As amended by Executive Order No. 111, December 24, 1986.)

 (d)  The notice must be in accordance with such

implementing rules and regulations as the Ministry of Labor and Employment may promulgate.

 x x x x  (f)  A decision to declare a strike must be

approved by a majority of the total union membership in the bargaining unit concerned, obtained by secret ballot in meetings or referenda called for that purpose.  A decision to declare a lockout must be approved by a majority of the board of directors of the corporation or association or of the partners in a partnership, obtained by secret ballot in a meeting called for that purpose.  The decision shall be valid for the duration of the dispute based on substantially the same grounds considered when the strike or lockout vote was taken.  The Ministry may, at its own initiative or upon the request of any affected party, supervise the conduct of the secret balloting.  In every case, the union or the employer shall furnish the Ministry the results of the voting at least seven days before the intended strike or lockout, subject to the cooling-off period herein provided.  (As amended by Batas Pambansa Bilang 130, August 21, 1981 and further amended by Executive Order No. 111, December 24, 1986.)

 

 

On the other hand, Rule XXII, Book V of the Omnibus Rules

Implementing the Labor Code likewise pertinently provides:

 

RULE XXII 

CONCILIATION, STRIKES AND LOCKOUTS 

x x x x  SEC. 6.  Who may declare a strike or lockout. —

Any certified or duly recognized bargaining representative may declare a strike in cases of bargaining deadlocks and unfair labor practices.  The employer may declare a lockout in the same cases.  In the absence of a certified or duly recognized bargaining representative, any legitimate labor organization in the establishment may declare a strike but only on grounds of unfair labor practice.  (Emphasis supplied.)

 

 

It is, thus, clear that the filing of the notice of strike and the

conduct of the strike-vote by KMLMS did not comply with the

aforequoted mandatory requirements of law and its implementing

rules. Consequently, the May 6, 2002 strike is illegal.  As the

Court held in Hotel Enterprises of the Philippines, Inc. (HEPI) v.

Samahan ng mga Manggagawa sa Hyatt-National Union of

Workers in the Hotel and Restaurant and Allied Industries

(SAMASAH-NUWHRAIN), these requirements are mandatory and

failure of a union to comply renders the strike illegal.

 

Striking KMLMS Members Committed Prohibited Acts

 

 

There is likewise no dispute that when the May 6, 2002

illegal strike was conducted, the members of respondent KMLMS

committed prohibited and illegal acts which doubly constituted the

strike illegal.  This is the unanimous factual finding of the courts a

quo which the Court accords finality, as supported by evidence on

record.

 

The proscribed acts during a strike are provided under Art.

264 of the Labor Code, thus:

 

ART. 264.  Prohibited Activities. — (a) No Labor organization or employer shall declare a strike or lockout without first having bargained collectively in accordance with Title VII of this Book or without first having filed the notice required in the preceding Article or without the necessary strike or lockout vote first having been obtained and reported to the Ministry.

 No strike or lockout shall be declared after

assumption of jurisdiction by the President or the Minister or after certification or submission of the dispute to compulsory or voluntary arbitration or during the pendency of case involving the same grounds for the strike or lockout.

 Any worker whose employment has been

terminated as a consequence of any unlawful lockout shall be entitled to reinstatement with full backwages.  Any union officer who knowingly participates in an illegal strike and any worker or union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost his employment status:  Provided, That mere participation of a worker in a lawful strike shall not constitute sufficient ground for termination of his employment, even if a replacement had been hired by the employer during such lawful strike.

 x x x x (e)  No person engaged in picketing shall commit

any act of violence, coercion or intimidation or obstruct the free ingress to or egress from the employer’s premises for lawful purposes, or obstruct public

thoroughfares.  (As amended by Batas Pambansa Bilang 227, June 1, 1982).

 

 

Here, the striking workers committed acts of (1) interference

by obstructing the free ingress to or egress from petitioners’

compound and (2) coercion and intimidation. As aptly pointed out

by the appellate court:

 

This is clear from the Police Blotter Certifications, including a Complaint for Grave Coercion, Affidavits from several workers, including one from a proprietor, all of whom were prevented from entering the company premises and doing their work or conducting their business, and the countless photographs which show the striking workers blocking the gates of the company premises which became the basis of the judgment of the Labor Arbiter and NLRC.

 

 

Thus, We agree with the CA that the arguments of respondent KMLMS are bereft of merit as the May 6, 2002 strike was properly declared an illegal strike and the prohibited and illegal acts committed by union members during said strike were duly proved by substantial evidence on record.  Substantial evidence is that

amount of relevant evidence which a reasonable mind might accept as adequate to justify a conclusion.

[G.R. No. 174631 : October 19, 2011]

JHORIZALDY UY, PETITIONER, VS. CENTRO CERAMICA CORPORATION AND/OR RAMONITA Y. SY AND MILAGROS U. GARCIA, RESPONDENTS.

Petitioner Jhorizaldy Uy was hired by respondent Centro Ceramica Corporation as full-time sales executive on March 21, 1999 under probationary employment for six months.  He became a regular employee on May 1, 2000 with monthly salary of P7,000.00 and P1,500.00 transportation allowance, plus commission.

On March 18, 2002, petitioner filed a complaint for illegal dismissal against the respondent company, its President Ramonita Y. Sy (Sy) and Vice-President Milagros Uy-Garcia (Garcia).

Petitioner alleged that his predicament began when former VP Garcia was rehired by respondent company in the last quarter of 2001.  Certain incidents involving longtime clients led to a strained working relationship between him and Garcia.  On February 19, 2002 after their weekly sales meeting, he was informed by his superior, Sales Supervisor Richard Agcaoili, that he (petitioner)

was to assume a new position in the marketing department, to which he replied that he will think it over. His friends had warned him to be careful saying "mainit ka kay Ms. Garcia." That same day, he was summoned by Sy and Garcia for a closed-door meeting during which Sy informed him of the termination of his services due to "insubordination" and advised him to turn over his samples and files immediately.  Sy even commented that "member ka pa naman ng [S]ingles for [C]hrist pero napakatigas naman ng ulo mo." On February 21, 2002,  he was summoned again by Sy but prior to this he was already informed by Agcaoili that the spouses Sy will give him all that is due to him plus goodwill money to settle everything.  However, during his meeting with Sy, he asked for his termination paper and thereupon Sy told him that "If that's what you want I will give it to you".  She added that "pag-isipan mo ang gagawin mo dahil kilala mo naman kami we are powerful."[4]

whether or not petitioner was dismissed by the respondents or voluntarily severed his employment by abandoning his job.

Yes. Scrutinizing the records, we find that the NLRC's finding of illegal dismissal is supported by the totality of evidence and more consistent with logic and ordinary human experience than the common finding of the CA and Labor Arbiter that petitioner informally severed his employment relationship with the company.  It hardly convinces us that after declining his supposed transfer to another department as per the information relayed to him by his supervisor, petitioner would readily turn over his files

and samples unless something critical indeed took place in his subsequent closed-door meeting with Sy and Garcia.  As correctly pointed out by petitioner, it is irrelevant whether or not he had earlier inquired from his supervisor what he will receive if he offers instead to resign upon being told of his impending transfer, for what matters is the action of Sy on his employment status. If ever petitioner momentarily contemplated resignation and such was the impression he conveyed in his talk with his supervisor prior to the meeting with Sy, such is borne by circumstances indicating Garcia's antagonism towards petitioner. In any event, whether such perception of a strained working relationship with Garcia was mistaken or not is beside the point.  The crucial factor is the verbal order directly given by Sy, the company president, for petitioner to immediately turn over his accountabilities. Notably, Sy got irked when petitioner asked for his termination paper.  Petitioner apparently wanted to ascertain whether such summary dismissal was official, and it was well within his right to demand that he be furnished with a written notice in order to apprise him of the real ground for his termination.

Contrary to respondents' theory that petitioner's act of  turning over the company files and samples is proof of his voluntary informal resignation rather than of the summary dismissal effected by management, no other plausible explanation can be made of such immediate turn over except that petitioner directly confirmed from the company president herself that he was already being dismissed.  The subsequent memos sent to petitioner's residence after he did not anymore report for work only reinforce the conclusion that the belated written notice of the charge against him - his alleged failure to meet the prescribed sales quota - was

an afterthought on the part of respondents who may have realized that they failed to observe due process in terminating him.  That respondents would still require a written explanation for petitioner's poor sales performance after the latter already complied with Sy's directive to turn over all his accountabilities is simply inconsistent with their claim that petitioner offered to resign and voluntarily relinquished possession of company files and samples when told of his impending transfer.  In other words, petitioner was not given any opportunity to defend himself from whatever charges hurled by management against him, such as poor sales performance as relayed to him by his supervisor, when Sy unceremoniously terminated him which must have shocked him considering that his supervisor earlier advised that he would just be transferred to another department.  Under this scenario, petitioner's decision not to report for work anymore was perfectly understandable, as the sensible reaction of an employee fired by no less than the company president.  It was indeed a classic case of dismissal without just cause and due process, which is proscribed under our labor laws.

As to the affidavits submitted by the respondents, these are at best self-serving having been executed by employees beholden to their employer and which evidence by themselves did not refute petitioner's main cause of action -- the fact of his summary dismissal on February 19, 2002.  Respondents' effort to present the case as one of an erring employee about to be investigated for poor sales performance must likewise fail. The NLRC duly noted the discriminatory treatment accorded to petitioner when it declared that there is no evidence at all that other sales personnel who failed to meet the prescribed sales quota were similarly

reprimanded or penalized.  Incidentally, the question may be asked if petitioner whose performance was assessed by management as "poor" yet admittedly ranked second to the top sales agent of the company, why was it that no evidence was submitted by respondents  to show the comparative sales performance of all sales agents? Given the strained working relationship with Garcia, or at least a perception of such gap on the part of petitioner, the latter could not have been properly informed of the actual ground for his dismissal. But more importantly, respondents terminated petitioner first and only belatedly sent him written notices of the charge against him. Fairness requires that dismissal, being the ultimate penalty that can be meted out to an employee, must have a clear basis. Any ambiguity in the ground for the termination of an employee should be interpreted against the employer, who ordained such ground in the first place.[14]

Resignation is defined as"the voluntary act of employees who are compelled by personal reasons to disassociate themselves from their employment. It must be done with the intention of relinquishing an office, accompanied by the act of abandonment."[15] In this case, the evidence on record suggests that petitioner did not resign; he was orally dismissed by Sy.  It is this lack of clear, valid and legal cause, not to mention due process, that made his dismissal illegal, warranting reinstatement and the award of backwages.[16]  Moreover, the filing of a complaint for illegal dismissal just three weeks later is difficult to reconcile with voluntary resignation.  Had petitioner intended to voluntarily relinquish his employment after being unceremoniously dismissed by no less than the company president, he would not

have sought redress from the NLRC and vigorously pursued this case against the respondents.[17]

When there is no showing of a clear, valid and legal cause for the termination of employment, the law considers it a case of illegal dismissal. Furthermore, Article 4 of the Labor Code expresses the basic principle that all doubts in the interpretation and implementation of the Labor Code should be interpreted in favor of the workingman.  This principle has been extended by jurisprudence to cover doubts in the evidence presented by the employer and the employee.[18]  Thus we have held that if the evidence presented by the employer and the employee are in equipoise, the scales of justice must be tilted in favor of the latter.[19] Accordingly, the NLRC's finding of illegal dismissal must be upheld.

[G.R. No. 164301 : October 19, 2011]

BANK OF THE PHILIPPINE ISLANDS, PETITIONER, VS. BPI EMPLOYEES UNION-DAVAO CHAPTER-FEDERATION OF UNIONS IN BPI UNIBANK, RESPONDENT.

[G.R. No. 151993, October 19, 2011]

MARITIME FACTORS INC., PETITIONER, VS. BIENVENIDO R. HINDANG, RESPONDENT.

On June 10, 1994, petitioner Maritime Factors Inc., a domestic manning agency, for and in behalf of its foreign principal Bahrain Marine Contracting/Panama, engaged the services of Danilo R. Hindang (Danilo) to work as GP/Deckhand on board the M/T "Reya," a Panamanian-registered ocean-going vessel.  Danilo's contract of employment was for a period of 12 months with a basic monthly salary of US$230.00.[3]

On July 27, 1994, while within the territorial jurisdiction of the Kingdom of Saudi Arabia and on board the vessel, Chief Mate Marcial Lauron, Jr., AB Jaime Aguinaldo and Oiler Allan P. Sarabia forced open Danilo's cabin door by taking out the screws on the door lock with a screw driver.  They found Danilo's body inside the locker (wardrobe) of his cabin.[4] Danilo was found hanging by a strap on his neck in a kneeling position.[5] Upon arriving at West Pier, Ras Tanurah, they turned over Danilo's body to the Saudi police authorities, who then brought the body to Dr. Ossman Abdel Hameed, the Medical Examiner of the Eastern Region, Kingdom of Saudi Arabia.  It was alleged that Dr. Hameed conducted an autopsy on Danilo's remains and concluded that Danilo committed suicide by hanging himself.[6]

Danilo's remains were repatriated to the Philippines where an autopsy was requested by Danilo's family. The autopsy was conducted by Dr. Maximo L. Reyes, a Medico-Legal Officer of the National Bureau of Investigation (NBI) and concluded that the cause of Danilo's death was Asphyxia by Strangulation, Ligature.

[7]  Dr. Reyes subsequently issued a Certification[8] dated December 27, 1994 clarifying that Danilo died of Asphyxia by strangulation which meant that somebody caused his death based on his autopsy findings.

On August 24, 1994, respondent Bienvenido R. Hindang, brother of the deceased seaman Danilo, filed for death compensation benefits pursuant to the POEA Standard Employment Contract Governing the Employment of All Filipino Seamen on Board Ocean-Going Vessels. The case was docketed as POEA Case No. 94-08-2599.[9]  Since efforts to settle the case amicably proved futile, the Labor Arbiter (LA) directed the parties to submit their respective position papers.

Petitioner filed its Position Paper claiming that based on Dr. Hameed's medical jurisprudence report, Danilo committed suicide by hanging himself; thus, his death is not compensable.  Petitioner submitted a photocopy of the fax transmission of a purported English translation of a 4-page medical jurisprudence report of Dr. Hameed where the latter stated that the cause of Danilo's death was suicide by hanging himself.  Petitioner also submitted the written report dated September 21, 1994 of Danilo's fellow crew members stating that Danilo's cabin door was locked, thus, they forced open it and found Danilo inside the locker room hanging by his neck in a kneeling position.

In his Position Paper, respondent contended that the NBI autopsy report categorically declared that the cause of Danilo's death was Asphyxia by strangulation, ligature; that the alleged Dr. Hameed's medical report cannot be given legal effect, since the report was a

mere photocopy of a fax transmission from petitioner's foreign principal, hence, the document was unreliable as to its due execution and genuineness.

Whether or not death benefits may be appreciated

Yes. In order to avail of death benefits, the death of the employee should occur during the effectivity of the employment contract. The death of a seaman during the term of employment makes the employer liable to his heirs for death compensation benefits. Once it is established that the seaman died during the effectivity of his employment contract, the employer is liable.[22]  This rule, however, is not absolute. The employer may be exempt from liability if he can successfully prove that the seaman's death was caused by an injury directly attributable to his deliberate or willful act.[23]    Clearly, respondent's entitlement to any death benefit depends on whether petitioner's evidence suffices to prove that Danilo committed suicide, and the burden of proof rests on petitioner.[24]

The LA, the NLRC and the CA found that Danilo died of Asphyxia by strangulation as proved by the NBI post-mortem findings and certification issued by the medico-legal officer, Dr. Reyes. These three tribunals did not consider the photocopy of the fax transmission of the  purported English translation of Dr. Hameed's medical report to prove that Danilo committed suicide, since the medical report's genuineness and due execution were unverifiable.

Notably, petitioner stated in all its pleadings filed that the medical report is the English translation of Dr. Hameed's report. However, the existence of the original medical report, which was written in the arabic language, was not even attached to the records and has not been proved.[25]

Moreover, the identity of the person who made the translation and whether the translator has the recognized competence in both English and the language the medical report was originally written are not established.[26] Thus, there is no clear assurance that the translated words are the accurate translation of the original medical report of Dr. Hameed.

More importantly, the alleged translated medical report was not even signed by Dr. Hameed which creates doubt as to its authenticity. The unsigned translated medical report is nothing but a self-serving document which ought to be treated as a mere scrap of paper devoid of any evidentiary value even in administrative proceedings.

Thus, based on the foregoing, the photocopy of the fax transmission of an alleged translated medical report was correctly denied consideration, since it is required that there be some proof of authenticity or reliability as condition for the admission of documents.[27]

[G.R. No. 185412 :November 16, 2011]

GILBERT QUIZORA, PETITIONER, VS. DENHOLM CREW MANAGEMENT (PHILIPPINES), INC., RESPONDENT.

Records show that in 1992, Denholm Crew Management

(Philippines), Inc. (respondent company), a domestic manning

agency that supplied manpower to Denklav Maritime Services,

Ltd. (Denklav), a foreign maritime corporation, hired the services

of Gilbert Quizora (petitioner) to work as a messman on board the

international vessels of Denklav. Based on Article 4.2 of the

Collective Bargaining Agreement (CBA) entered into by and

between the Association of Marine Officers and Seamen Union of

the Philippines (AMOSUP) and Denholm Ship Management

(Singapore) Ltd., represented by Denklav, his contractual work as

messman was considered terminated upon the expiration of each

contract. Article 5.1 thereof provided that the duration of his sea

service with respondent company was nine (9) months depending

on the requirements of the foreign principal. After the end of a

contract for a particular vessel, he would be given his next

assignment on a different vessel. His last assignment was from

November 4, 1999 to July 16, 2000 on board the vessel “MV

Leopard.”

 

 After the expiration of his contract with “MV Leopard,”

petitioner was lined up for another assignment to a different

vessel, but he was later disqualified for employment and declared

unfit for sea duty after he was medically diagnosed to be suffering

from “venous duplex scan (lower extremities) deep venous

insufficiency, bilateral femoral and superficial femoral veins and

the (L) popliteal vein.” In layman’s terms, he was medically found

to have varicose veins.

 

 

         

Subsequently, petitioner demanded from respondent

company the payment of disability benefits, separation pay and

reimbursement of medical expenses.  His demands, however,

were denied. He then submitted his claim before the AMOSUP,

but it was likewise denied. Thereafter, he filed with the LA a

complaint for payment of disability benefits, medical expenses,

separation pay, damages, and attorney’s fees.

WHETHER PETITIONER IS ENTITLED TO DISABILITY BENEFITS

No. Unfortunately for petitioner, he failed to prove that his

varicose veins arose out of his employment with respondent

company. Except for his bare allegation that it was work-related,

he did not narrate in detail the nature of his work as a messman

aboard Denklav’s vessels. He likewise failed to particularly

describe his working conditions while on sea duty. He also failed

to specifically state how he contracted or developed varicose

veins while on sea duty and how and why his working conditions

aggravated it. Neither did he present any expert medical opinion

regarding the cause of his varicose veins.  No written document

whatsoever was presented that would clearly validate his claim or

visibly demonstrate that the working conditions on board the

vessels he served increased the risk of acquiring varicose veins.

 

Moreover, although petitioner was rehired by respondent

company several times, his eight-year service as a seaman was

not actually without a “sign-off” period. His contract with

respondent company was considered automatically terminated

after the expiration of each overseas employment contract. Upon

the termination of each contract, he was considered “signed-off”

and he would have to go back and re-apply by informing

respondent company as to his availability. Thereafter, he would

have to sign an Availability Advise Form. Meanwhile, he would

have to wait for a certain period of time, probably months, before

he would be called again for sea service.

 

 

Thus, respondent company can argue that petitioner’s eight

(8) years of service with it did not automatically mean that he

acquired his varicose veins by reason of such employment. His

sea service was not an unbroken service. The fact that he never

applied for a job with any other employer is of no moment. He

enjoyed month-long “sign-off” vacations when his contract

expired. It is possible that he acquired his condition during one of

his “sign-off” periods.

 

 As discussed in the decision of the CA, varicose veins may

be caused by trauma, thrombosis, inflammation or heredity.

Although the exact cause of varicose veins is still unknown, a

number of factors contribute to it which include heredity, advance

aging, prolonged standing, being overweight, hormonal influences

during pregnancy, use of birth control pills, post-menopausal

hormonal replacement therapy, prolonged sitting with legs

crossed, wearing tight undergarments or clothes, history of blood

clots, injury to the veins, conditions that cause increased pressure

in the abdomen including liver disease, fluid in the abdomen,

previous groin injury, heart failure, topical steroids, trauma or

injury to the skin, previous venous surgery and exposure to ultra-

violet rays.

 

Lastly, there is also no proof that petitioner’s varicose veins

caused him to suffer total and permanent disability. The Pre-

Employment Medical Examination (PEME) he underwent cannot

serve as enough basis to justify a finding of a total and permanent

disability because of its non-exploratory nature.

The fact that respondent passed the company’s PEME is of no moment. We have ruled that in the past the PEME is not exploratory in nature. It was not intended to be a totally in-depth and thorough examination of an applicant’s medical condition. The PEME merely determines whether one is "fit to work" at sea or "fit for sea service," it does not state the real state of health of an applicant. In short, the "fit to work" declaration in the respondent’s PEME cannot be a

conclusive proof to show that he was free from any ailment prior to his deployment. Thus we held in NYK-FIL Ship Management, Inc. v. NLRC:

While a PEME may reveal enough for the petitioner (vessel) to decide whether a seafarer is fit for overseas employment, it may not be relied upon to inform petitioners of a seafarer’s true state of health. The PEME could not have divulged respondent’s illness considering that the examinations were not exploratory.

 

Besides, it was not expressly stated in his medical diagnosis

that his illness was equivalent to a total and permanent disability.

Absent any indication, the Court cannot accommodate him.

[G.R. Nos. 180849 and 187143 : November 16, 2011]

PHILIPPINE NATIONAL BANK, PETITIONER, VS. DAN PADAO, RESPONDENT.

On August 21, 1981, Padao was hired by PNB as a clerk at its

Dipolog City Branch. He was later designated as a credit

investigator in an acting capacity on November 9, 1993. On

March 23, 1995, he was appointed regular Credit Investigator III,

and was ultimately promoted to the position of Loan and Credit

Officer IV.

 

          Sometime in 1994, PNB became embroiled in a scandal

involving “behest loans.”  A certain Sih Wat Kai complained to the

Provincial Office of the Commission on Audit (COA) of

Zamboanga del Norte that anomalous loans were being granted

by its officers: Assistant Vice President (AVP) and Branch

Manager Aurelio De Guzman (AVP de Guzman), Assistant

Department Manager and Cashier Olson Sala (Sala), and Loans

and Senior Credit Investigator Primitivo Virtudazo (Virtudazo).

 

 

          The questionable loans were reportedly being extended to

select bank clients, among them Joseph Liong, Danilo Dangcalan,

Jacinto Salac, Catherine Opulentisima, and Virgie Pango. The

exposé triggered the conduct of separate investigations by the

COA and PNB’s Internal Audit Department (IAD) from January to

August 1995. Both investigations confirmed that the collateral

provided in numerous loan accommodations were grossly over-

appraised. The credit standing of the loan applicants was also

fabricated, allowing them to obtain larger loan portfolios from

PNB. These borrowers eventually defaulted on the payment of

their loans, causing PNB to suffer millions in losses.

 

          In August 1995, Credit Investigators Rolando Palomares

(Palomares) and Cayo Dagpin (Dagpin) were administratively

charged with Dishonesty, Grave Misconduct, Gross Neglect of

Duty, Conduct Prejudicial to the Best Interest of the Service, and

violation of Republic Act (R.A.) No. 3019 (Anti-Graft and Corrupt

Practices Act), in connection with an anomalous loan granted to

the spouses, Jaime and Allyn Lim (the Lims). These charges,

however, were later ordered dropped by PNB, citing its findings

that Dagpin and Palomares signed the Inspection and Appraisal

Report (IAR) and the Credit Inspection Report (CIR) in support of

the Lims’ loan application in good faith, and upon the instruction

of their superior officers. PNB also considered using Dagpin and

Palomares as prosecution witnesses against AVP de Guzman,

Loan Division Chief Melindo Bidad (Bidad) and Sala.

 

          The following month, September 1995, administrative

charges for Grave Misconduct, Gross Neglect of Duty and Gross

Violations of Bank Rules and Regulations and criminal cases for

violation of R.A. No. 3019 were filed against AVP de Guzman,

Sala, Virtudazo, and Bidad. Consequently, they were all

dismissed from the service by PNB in November 1996. Later,

Virtudazo was ordered reinstated.   

 

On June 14, 1996, Padao and Division Chief Wilma Velasco

(Velasco) were similarly administratively charged with Dishonesty,

Grave Misconduct, Gross Neglect of Duty, Conduct Prejudicial to

the Best Interest of the Service, and violation of R.A. No. 3019.

 

          The case against Padao was grounded on his having

allegedly presented a deceptively positive status of the business,

credit standing/rating and financial capability of loan applicants

Reynaldo and Luzvilla Baluma and eleven (11) others. It was later

found that either said borrowers’ businesses were inadequate to

meet their loan obligations, or that the projects they sought to be

financed did not exist.

 

          Padao was also accused of having over-appraised the

collateral of the spouses Gardito and Alma Ajero, the spouses

Ibaba, and Rolly Pango.

 

          On January 10, 1997, after due investigation, PNB found

Padao guilty of gross and habitual neglect of duty and ordered

him dismissed from the bank. Padao appealed to the bank’s

Board of Directors. On January 20, 1997, Velasco was also held

guilty of the offenses charged against her, and was similarly

meted the penalty of dismissal. Her motion for reconsideration,

however, was later granted by the bank, and she was reinstated.

 

On October 11, 1999, after almost three (3) years of inaction

on the part of the Board, Padao instituted a complaint against

PNB and its then AVP, Napoleon Matienzo (Matienzo), with the

Labor Arbitration Branch of the NLRC Regional Arbitration Branch

(RAB) No. IX in Zamboanga City for 1] Reinstatement; 2]

Backwages; 3] Illegal Dismissal; and 4] Treachery/Bad Faith and

Palpable Discrimination in the Treatment of Employees with

administrative cases.  The case was docketed as RAB 09-04-

00098-01.

Whether or not employee was illegally dismissed

No. In this case, Padao was dismissed by PNB for gross and

habitual neglect of duties under Article 282 (b) of the Labor Code.

 

Gross negligence 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. Gross negligence has been defined as the want or

absence of or failure to exercise slight care or diligence, or the

entire absence of care. It evinces a thoughtless disregard of

consequences without exerting any effort to avoid them.

 

In the case at bench, Padao was accused of having

presented a fraudulently positive evaluation of the business, credit

standing/rating and financial capability of Reynaldo and Luzvilla

Baluma and eleven other loan applicants. Some businesses were

eventually found not to exist at all, while in other transactions, the

financial status of the borrowers simply could not support the

grant of loans in the approved amounts. Moreover, Padao over-

appraised the collateral of spouses Gardito and Alma Ajero, and

that of spouses Ihaba and Rolly Pango.

 

The role that a credit investigator plays in the conduct of a

bank’s business cannot be overestimated. The amount of loans to

be extended by a bank depends upon the report of the credit

investigator on the collateral being offered.  If a loan is not fairly

secured, the bank is at the mercy of the borrower who may just

opt to have the collateral foreclosed. If the scheme is repeated a

hundredfold, it may lead to the collapse of the bank. In the case of

Sawadjaan v. Court of Appeals, the Court stressed the crucial role

that a credit investigator or an appraiser plays.  Thus:

 

Petitioner himself admits that the position of appraiser/inspector is "one of the most serious [and] sensitive job[s] in the banking operations." He should have been aware that accepting such a designation, he is obliged to perform the task at hand by the exercise of more than ordinary prudence. As appraiser/investigator, the petitioner was expected to conduct an ocular inspection of the properties offered by CAMEC as collaterals and check the copies of the certificates of title against those on file with the Registry of Deeds.  Not only did he fail to conduct these routine checks, but he also deliberately misrepresented in his appraisal

report that after reviewing the documents and conducting a site inspection, he found the CAMEC loan application to be in order.  Despite the number of pleadings he has filed, he has failed to offer an alternative explanation for his actions. [Emphasis supplied]

 

In fact, banks are mandated to exercise more care and

prudence in dealing with registered lands:

 [B]anks are cautioned to exercise more care and

prudence in dealing even with registered lands, than private individuals, "for their business is one affected with public interest, keeping in trust money belonging to their depositors, which they should guard against loss by not committing any act of negligence which amounts to lack of good faith by which they would be denied the protective mantle of the land registration statute Act 496, extended only to purchasers for value and in good faith, as well as to mortgagees of the same character and description. It is for this reason that banks before approving a loan send representatives to the premises of the land offered as collateral and investigate who are the true owners thereof.

 

Padao’s repeated failure to discharge his duties as a credit

investigator of the bank amounted to gross and habitual neglect of

duties under Article 282 (b) of the Labor Code. He not only failed

to perform what he was employed to do, but also did so

repetitively and habitually, causing millions of pesos in damage to

PNB. Thus, PNB acted within the bounds of the law by meting out

the penalty of dismissal, which it deemed appropriate given the

circumstances. 

 

The CA was correct in stating that when the violation of

company policy or breach of company rules and regulations is

tolerated by management, it cannot serve as a basis for

termination.  Such ruling, however, does not apply here. The

principle only applies when the breach or violation is one which

neither amounts to nor involves fraud or illegal activities. In such a

case, one cannot evade liability or culpability based on obedience

to the corporate chain of command.

[G.R. No. 176377 : November 16, 2011]

FUNCTIONAL, INC. PETITIONER, VS. SAMUEL C. GRANFIL, RESPONDENT.

Sometime in 1992, respondent Samuel C. Granfil was hired as

key operator by petitioner Functional, Inc. (FI), a domestic

corporation engaged in the business of sale and rental of various

business equipments, including photocopying machines.  As Key

Operator, Granfil was tasked to operate the photocopying

machine rented by the National Bookstore (NBS) at its SM

Megamall Branch.  There is no dispute regarding the fact that, in

the evening of 30 July 2002, Granfil attended to a customer by the

name of Cosme Cavaldeja (Cavaldeja) who, together with his

wife, asked to have their flyers photocopied.  It appears that

Bonnel Dechavez, the security guard assigned at said

establishment, saw Cavaldeja handing money to Granfil after the

transaction was finished.  After investigating the matter, Dechavez

submitted the following incident report to NBS Branch Manager

Lucy Genegaban (Genegaban), to wit:

            At around 1940 on July 30, 2002 at NBS SM

Megamall Dona Julia Vargas Ave., Mandaluyong City, I checked one customer and asked if he already paid for his xerox[ed] item’s (sic) and he said “yes.”  Upon asking for a receipt, he pointed to Sammy the Xerox operator [to] whom he g[a]ve payment, instead of paying to the cashier.  Sammy came and it was only then that he brought the customer to the counter 09 for

payment [of] the amount of [the] xerox[ed] item’s (sic) is P250.    

 

          On 3 September 2002, Granfil filed a complaint against FI,

its President, Romeo Bautista (Bautista), its Marketing Manager,

Freddie Tenorio (Tenorio), its Office Supervisor, Julius Ballesteros

(Ballesteros), and its Area Supervisor, Joel Dizon (Dizon), for

illegal dismissal, unpaid 13th month pay, moral and exemplary

damages and attorney’s fees.  In support of his complaint which

was docketed as NLRC NCR Case No. 09-07126-2002 before the

arbitral level of the National Labor Relations Commission (NLRC),

Granfil alleged, among other matters, that the money which

Dechavez saw him receive from Cavaldeja was a P200 tip said

customer gave him in appreciation of his assistance in xeroxing

and organizing the batches of voluminous materials he asked to

be photocopied; that payment for the materials was, however,

already paid per batch by Cavaldeja’s wife who, by that time, had

already left the premises; and, that rather than listening to his

explanation and simply verifying the meter of the photocopy

machine as well as the paper allotted to it, Dechavez submitted

his incident report which, in turn, caused Tenorio to tell him, “Mr.

Granfil, magpahinga ka muna.  Mabuti pa, pumirma ka nalang ng

resignation letter para may makuha ka pa.”

 

          Granfil further asseverated that, with said incident report

having been telefaxed to FI’s head office, he was asked to report

thereat in the morning of 31 July 2002; that instead of allowing

him to explain, however, Ballesteros peremptorily ordered his

termination from employment; that wishing to explain his side, he

sought out Dizon who merely ignored and tersely advised him,

“Magpahinga ka na lang”; that refused entry when he tried to

report for work on 1 August 2002, he subsequently sought out

Cavaldeja whose corroboration of his version of the incident also

fell on deaf ears; that having been terminated without just cause

and observance of due process, he was constrained to file the 3

September 2002 complaint from which the instant suit originated;

that aside from the reinstatement to which he is clearly entitled as

an illegally dismissed employee, he should be paid full

backwages and 13th month pay for the year 2002; and, that in

view of the malice and bad faith which characterized his dismissal

from employment, Bautista, Tenorio, Ballesteros and Dizon

should be held jointly and severally liable with FI for the payment

of said indemnities as well as his claims for moral and exemplary

damages and attorney’s fees.

 

          In their position paper, FI and its corporate officers, in turn,

averred that having been apprised of the incident, Genegaban

requested for Granfil’s relief as Key Operator of the photocopying

machine installed at the NBS SM Megamall Branch; that for the

good of all concerned, FI informed Granfil that he was going to be

transferred to a different assignment, without demotion in rank or

diminution of his salaries, benefits and other privileges; that

required to report to FI’s main office to act as emergency reliever

to other Key Operators while waiting for his new assignment,

Granfil misconstrued his transfer as a punishment for his guilt and

refused to heed said directive which was within the

management’s prerogative to issue; that an employee’s right to

security of tenure does not give him such vested right to his

position as would deprive his employer of its prerogative to

change his assignment or transfer him where he will be most

useful; and, that aside from being guilty of insubordination, Granfil

clearly abandoned his employment rather than illegally dismissed

therefrom.

 

          On 29 April 2003, Labor Arbiter Eduardo Carpio rendered a

decision discounting Granfil’s illegal dismissal from employment in

view of his failure to prove with substantial evidence overt acts of

termination on the part of FI and its officers.  Simply awarded the

sum of P3,966.65 as proportionate 13th month pay for services

rendered from January to July 2002, Granfil perfected the appeal

which was docketed before the First Division of the NLRC as

NLRC NCR CA No. 035887-03.  With the affirmance of the Labor

Arbiter’s decision in the 20 April 2005 Resolution issued by the

NLRC and the subsequent denial of his motion seeking the

reconsideration of said decision, Granfil elevated the case

through the Rule 65 petition for certiorari docketed before the CA

as CA-G.R. SP No. 94851.  On 22 November 2006, the CA

rendered the herein assailed 22 November 2006 Decision,

reversing the NLRC’s 20 April 2005 Resolution on the ground that

FI failed to satisfactorily prove Granfil’s supposed abandonment

of his employment which, by itself, was negated by his filing of a

case for illegal employment. Ordering FI to reinstate Granfil and to

pay his full backwages, allowances and other benefits from 31

July 2002 until his actual reinstatement, the CA denied said

employee’s claims for moral and exemplary damages as well as

attorney’s fees for lack of factual basis.

 

          FI’s motion for reconsideration of the CA’s 22 November

2006 decision was denied for lack of merit in said court’s 22

January 2007 resolution, hence, this petition.

Whether or not employee was illegally dismissed

Yes. The rule is long and well settled that, in illegal dismissal

cases like the one at bench, the burden of proof is upon the

employer to show that the employee’s termination from service is

for a just and valid cause.  The employer’s case succeeds or fails

on the strength of its evidence and not the weakness of that

adduced by the employee, in keeping with the principle that the

scales of justice should be tilted in favor of the latter in case of

doubt in the evidence presented by them. Often described as

more than a mere scintilla, the quantum of proof is substantial

evidence which is understood as such relevant evidence as a

reasonable mind might accept as adequate to support a

conclusion, even if other equally reasonable minds might

conceivably opine otherwise.  Failure of the employer to

discharge the foregoing onus would mean that the dismissal is not

justified and therefore illegal.

 

          Denying the charge of illegal dismissal, FI insists that

Granfil abandoned his employment after he was transferred from

his assignment at the NBS Megamall Branch as a consequence

of the latter’s request for his relief.  In the same manner that it

cannot be said to have discharged the above-discussed burden

by merely alleging that it did not dismiss the employee, it has

been ruled that an employer cannot expediently escape liability

for illegal dismissal by claiming that the former abandoned his

work.   This applies to FI which adduced no evidence to prove

Granfil’s supposed abandonment beyond submitting copies of

NBS’ 31 July 2002 request for said employee’s transfer and its 1

August 2002 written acquiescence thereto.  While these

documents may have buttressed the claim that Granfil was indeed

recalled from his assignment, however, we find that the CA

correctly discounted their probative value insofar as FI’s theory of

abandonment is concerned. 

 

          Being a matter of intention, moreover, abandonment cannot

be inferred or presumed from equivocal acts.  As a just and valid

ground for dismissal, it requires the deliberate, unjustified refusal

of the employee to resume his employment, without any intention

of returning.  Two elements must concur: (1) failure to report for

work or absence without valid or justifiable reason, and (2) a clear

intention to sever the employer-employee relationship, with the

second element as the more determinative factor and being

manifested by some overt acts.  The burden of proving

abandonment is once again upon the employer who, whether

pleading the same as a ground for dismissing an employee or as

a mere defense, additionally has the legal duty to observe due

process.  Settled is the rule that mere absence or failure to report

to work is not tantamount to abandonment of work.

 

          Viewed in the light of the foregoing principles, we find that

the CA correctly ruled out FI’s position that Granfil had

abandoned his employment.  Aside from the fact that Bautista,

Tenorio, Ballesteros and Dizon did not even execute sworn

statements to refute the overt acts of dismissal imputed against

them, the record is wholly bereft of any showing that FI required

Granfil to report to its main office or, for that matter, to explain his

supposed unauthorized absences.  Absence must be

accompanied by overt acts unerringly pointing to the fact that the

employee simply does not want to work anymore.  Even then, FI’s

theory of abandonment was likewise negated by Granfil’s filing

the complaint for illegal dismissal which evinced his desire to

return to work.  In vigorously pursuing his action against FI before

the Labor Arbiter, the NLRC and the CA, Granfil clearly

manifested that he has no intention of relinquishing his

employment.   In any case, the fact that Granfil prayed for his

reinstatement speaks against any intent to sever the employer-

employee relationship with FI.

 

[G.R. No. 174179 : November 16, 2011]

KAISAHAN AT KAPATIRAN NG MGA MANGGAGAWA AT KAWANI SA MWC-EAST ZONE UNION AND EDUARDO BORELA, REPRESENTING ITS MEMBERS, PETITIONERS, VS. MANILA WATER COMPANY, INC., RESPONDENT.

The background facts are not disputed and are summarized

below.

 

          The Union is the duly-recognized bargaining agent of the

rank-and-file employees of the respondent Manila Water

Company, Inc. (Company) while Borela is the Union President.

On February 21, 1997, the Metropolitan Waterworks and

Sewerage System (MWSS) entered into a Concession Agreement

(Agreement) with the Company to privatize the operations of the

MWSS.  Article 6.1.3 of the Agreement provides that “the

Concessionaire shall grant [its] employees benefits no less

favorable than those granted to MWSS employees at the time of

[their] separation from MWSS.” Among the benefits enjoyed by

the employees of the MWSS were the amelioration allowance

(AA) and the cost-of-living allowance (COLA) granted in August

1979, pursuant to Letter of Implementation No. 97 issued by the

Office of the President.

 

The payment of the AA and the COLA was discontinued

pursuant to Republic Act No. 6758, otherwise known as the

“Salary Standardization Law,” which integrated the allowances

into the standardized salary.  Nonetheless, in 2001, the Union

demanded from the Company the payment of the AA and the

COLA during the renegotiation of the parties’ Collective

Bargaining Agreement (CBA).  The Company initially turned down

this demand, however, it subsequently agreed to an amendment

of the CBA on the matter, which provides:

 

The Company shall implement the payment of the Amelioration Allowance and Cost of Living [A]llowance retroactive August 1, 1997 should the MWSS decide to pay its employees and all its former employees or upon award of a favorable order by the MWSS Regulatory Office or upon receipt of [a] final court judgment.

  

          Thereafter, the Company integrated the AA into the monthly

payroll of all its employees beginning August 1, 2002, payment of

the AA and the COLA after an appropriation was made and

approved by the MWSS Board of Trustees.  The Company,

however, did not subsequently include the COLA since the

Commission on Audit disapproved its payment because the

Company had no funds to cover this benefit.

 

As a result, the Union and Borela filed on April 15, 2003 a complaint against the Company for payment of the AA, COLA, moral and exemplary damages, legal interest, and attorney’s fees before the National Labor Relations Commission (NLRC).

Whether or not the amount of attorney’s fees is tenable

No.    In the present case, the ten percent (10%) attorney’s fees

awarded by the NLRC on the basis of Article 111 of the Labor

Code accrue to the Union’s members as indemnity for damages

and not to the Union’s counsel as compensation for his legal

services, unless, they agreed that the award shall be given to

their counsel as additional or part of his compensation; in this

case the Union bound itself to pay 10% attorney’s fees to its

counsel under the MOA and also gave up the attorney’s fees

awarded to the Union’s members in favor of their counsel.  This is

supported by Borela’s affidavit which stated that “[t]he 10%

attorney’s fees paid by the members/employees is separate and

distinct from the obligation of the company to pay the 10%

awarded attorney’s fees which we also gave to our counsel as

part of our contingent fee agreement.”  The limit to this agreement

is that the indemnity for damages imposed by the NLRC on the

losing party (i.e., the Company) cannot exceed ten percent

(10%). 

 

Properly viewed from this perspective, the award cannot be

taken to mean an additional grant of attorney’s fees, in violation of

the ten percent (10%) limit under Article 111 of the Labor Code

since it rests on an entirely different legal obligation than the one

contracted under the MOA.  Simply stated, the attorney’s fees

contracted under the MOA do not refer to the amount of attorney’s

fees awarded by the NLRC; the MOA provision on attorney’s fees

does not have any bearing at all to the attorney’s fees awarded by

the NLRC under Article 111 of the Labor Code.  Based on these

considerations, it is clear that the CA erred in ruling that the LA’s

award of attorney’s fees violated the maximum limit of ten percent

(10%) fixed by Article 111 of the Labor Code.

 

Under this interpretation, the Company’s argument that the attorney’s fees are unconscionable as they represent 20% of the amount due or about P21.4 million is more apparent than real.  Since the attorney’s fees awarded by the LA pertained to the Union’s members as indemnity for damages, it was totally within their right to waive the amount and give it to their counsel as part of their contingent fee agreement.  Beyond the limit fixed by Article 111 of the Labor Code, such as between the lawyer and the client, the attorney’s fees may exceed ten percent (10%) on the basis of quantum meruit, as in the present case.

[G.R. No. 171644 : November 23, 2011]

DELIA D. ROMERO, PETITIONER, VS. PEOPLE OF THE PHILIPPINES, ROMULO PADLAN AND ARTURO SIAPNO, RESPONDENTS.

Private respondent Romulo Padlan (Romulo) was a former

classmate of petitioner in college.  Sometime in September 2000

Romulo went to petitioner's stall (wedding gown rentals) at W. A.

Jones St., Calasiao, Pangasinan to inquire about securing a job in

Israel. Convinced by petitioner's words of encouragement and

inspired by the potential salary of US$700.00 to US$1,200.00 a

month, Romulo asked petitioner the amount of money required in

order for him to be able to go to Israel. Petitioner informed him

that as soon as he could give her US$3,600.00, his papers would

be immediately processed.  To raise the amount, Romulo secured

a loan from a bank and borrowed some more from his friends. 

When he was able to raise the amount, Romulo went back to

petitioner and handed her the money.  Petitioner contacted

Jonney Erez Mokra who instructed Romulo to attend a briefing at

his (Jonney's) house in Dau, Mabalacat, Pampanga.  Romulo was

able to leave for Israel on October 26, 2000 and was able to

secure a job with a monthly salary of US$650.00.  Unfortunately,

after two and a half months, he was caught by Israel's

immigration police and detained for 25 days. He was

subsequently deported because he did not possess a working

visa.  On his return, Romulo demanded from petitioner the return

of his money, but the latter refused and failed to do so.

 

         On the other hand, private respondent Arturo Siapno is

petitioner's nephew.  Sometime in August 2000, he went to

petitioner's stall. He was convinced by the petitioner that if he

could give her US$3,600.00 for the processing of his papers, he

could leave the country within 1 to 2 weeks for a job placement in

Israel.  Arturo contacted a relative in the U.S. to ask the latter to

cover the expenses for the former's overseas job placement.  The

relative sent the US$3,000.00 to Teresita D. Visperas, petitioner's

sister in Israel. Petitioner processed Arturo's papers and

contacted Jonney Erez Mokra.  Jonney instructed Arturo to attend

a briefing in Dau, Mabalacat, Pampanga.  Afterwards, Arturo left

for Israel sometime in September 2000.  He was able to work and

receive US$800.00 salary per month.  After three months of stay

in Israel, he was caught by the immigration officials, incarcerated

for ten days and was eventually deported.  After arriving in the

country, Arturo immediately sought the petitioner.  Petitioner

promised him that she would send him back to Israel, which did

not happen.

 

         Arturo, after learning that Romulo suffered the same fate,

checked with the Department of Labor and Employment (DOLE)

Dagupan District Office whether petitioner, Teresita D. Visperas

and Jonney Erez Mokra had any license or authority to recruit

employees for overseas employment.  Finding that petitioner and

the others were not authorized to recruit for overseas

employment, Arturo and Romulo filed a complaint against

petitioner, Teresita and Jonney before the National Bureau of

Investigation (NBI). 

 

         Consequently, an Information dated June 18, 2001 was filed

against petitioner and Jonney Erez Mokra for the crime of Illegal

Recruitment which reads as follows:

 

That sometime in the month of August and September 2000 in the Municipality  of Calasiao, Province of Pangasinan, Philippines, and within the jurisdiction of this Honorable Court, the above-named accused, not being licensee or holder of authority, conspiring, confederating and mutually helping one another, did then and there, wilfully, unlawfully and feloniously undertake and perform recruitment activity by recruiting ARTURO SIAPNO and ROMULO

PADLAN to a supposed job abroad particularly in Israel, for a fee, without first securing the necessary license and permit to do the same.

 CONTRARY to Art. 38 (a) of P.D. 442, as

amended by P.D. 2018. 

 

         Upon arraignment on August 20, 2001, petitioner, with the

assistance of her counsel pleaded not guilty, whereas accused

Jonney Erez Mokra was and is still at-large.  Thereafter, trial on

the merits ensued.

 

         To establish the facts earlier mentioned, the prosecution

presented the testimonies of Romulo Padlan and Arturo Siapno.

Petitioner, on the other hand, offered her own testimony, as well

as Satchi Co Pontace’s to prove that petitioner did not recruit the

private respondents.  According to petitioner, private respondents

went to her to inquire about the working status of her sister in

Israel.  She told them that her sister was doing well.  When

private respondents asked her how her sister was able to go to

Israel, petitioner told them that she does not know and that she

will have to ask her sister about that matter.  Petitioner then

called her sister and told her that the private respondents wanted

to ask for her help in going to Israel.  It was petitioner's sister and

the private respondents who communicated with each other, and

the petitioner had no knowledge as to the content of the former's

conversations and agreements.

Whether or not there has been illegal recruitment

Yes.         Illegal recruitment is defined in Article 38 of the Labor

Code, as amended, as follows:

 

ART. 38. Illegal Recruitment. - (a) Any recruitment activities, including the prohibited practices enumerated under Article 34 of this Code, to be undertaken by non-licensees or non-holders of authority, shall be deemed illegal and punishable under Article 39 of this Code. The [Department] of Labor and Employment or any law enforcement officer may initiate complaints under this Article.

                        (b) Illegal recruitment when committed by a syndicate or in large scale shall be considered an offense involving economic sabotage and shall be penalized in accordance with Article 39 hereof.

                        Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or more persons conspiring and/or confederating with one

another in carrying out any unlawful or illegal transaction, enterprise or scheme defined under the first paragraph hereof. Illegal recruitment is deemed committed in large scale if committed against three (3) or more persons individually or as a group.

 

            Article 13 (b) of the same Code defines, “recruitment and

placement” as: “any act of canvassing, enlisting, contracting,

transporting, utilizing, hiring or procuring workers, and includes

referrals, contract services, promising or advertising for

employment, locally or abroad, whether for profit or not: Provided,

that any person or entity which, in any manner, offers or promises

for a fee, employment to two or more persons shall be deemed

engaged in recruitment and placement.”

 

         The crime of illegal recruitment is committed when two

elements concur, namely: (1) the offender has no valid license or

authority required by law to enable one to lawfully engage in

recruitment and placement of workers; and (2) he undertakes

either any activity within the meaning of "recruitment and

placement" defined under Article 13 (b), or any prohibited

practices enumerated under Article 34 of the Labor Code.

 

         In disputing the absence of the first element, petitioner

offers her opinion that the CA erred in affirming the trial court's

reliance on a mere certification from the DOLE Dagupan District

Office that she does not have the necessary licence to recruit

workers for abroad.  She claims that the prosecution committed a

procedural lapse in not procuring a certification from the agency

primarily involved, the Philippine Overseas Employment

Administration (POEA).  The said argument, however, is flawed.

 

         Under the first element, a non-licensee or non-holder of

authority is any person, corporation or entity which has not been

issued a valid license or authority to engage in recruitment and

placement by the Secretary of Labor, or whose license or

authority has been suspended, revoked or cancelled by the POEA

or the Secretary.  Clearly, the creation of the POEA did not divest

the Secretary of Labor of his/her jurisdiction over recruitment and

placement of activities.  The governing rule is still Article 35 of the

Labor Code. This is further discussed in this Court's ruling in

Trans Action Overseas Corp. v. Secretary of Labor, wherein it

was ruled that:

 

                   In the case of Eastern Assurance and Surety Corp. v. Secretary of Labor, we held that: 

The penalties of suspension and cancellation of license or authority are prescribed for violations of the above-quoted provisions, among others.  And the Secretary of Labor has the power under Section 35 of the law to apply these sanctions, as well as the authority, conferred by Section 36, not only to “restrict and regulate the recruitment and placement activities of all agencies,” but also to “promulgate rules and regulations to carry out the objectives and implement the provisions” governing said activities.  Pursuant to this rule-making power thus granted, the Secretary of Labor gave the POEA, on its own initiative or upon a filing of a complaint or report or upon request for investigation by any aggrieved person, “xxx (authority to) conduct the necessary proceedings for the suspension or cancellation of the license or authority of any agency or entity” for certain enumerated offenses including -

 1) the imposition or acceptance, directly

or indirectly, of any amount of money, goods or services, or any fee  or bond in excess of what is prescribed by the Administration, and

 

2)   any other violation of pertinent provisions of the Labor Code and other relevant laws, rules and regulations.

             The Administrator was also given the power to “order the dismissal of the case or the suspension of the license or authority of the respondent agency or contractor or recommend to the Minister the cancellation thereof.”                         This power conferred upon the Secretary of Labor and Employment was echoed in People v. Diaz, viz.: 

A non-licensee or non-holder of authority means any person, corporation or entity which has not been issued a valid license or authority to engage in recruitment and placement by the Secretary of Labor, or whose license or authority has been suspended, revoked or cancelled by the POEA or the Secretary.

[G.R. No. 169757 : November 23, 2011]

CESAR C. LIRIO, DOING BUSINESS UNDER THE NAME AND STYLE OF CELKOR AD SONICMIX, PETITIONER, VS. WILMER D. GENOVIA, RESPONDENT.

On July 9, 2002, respondent Wilmer D. Genovia filed a

complaint against petitioner Cesar Lirio and/or Celkor Ad

Sonicmix Recording Studio for illegal dismissal, non-payment of

commission and award of moral and exemplary damages.

 

In his Position Paper, respondent Genovia alleged, among

others, that on August 15, 2001, he was hired as studio manager

by petitioner Lirio, owner of Celkor Ad Sonicmix Recording Studio

(Celkor). He was employed to manage and operate Celkor and to

promote and sell the recording studio's services to music

enthusiasts and other prospective clients. He received a monthly

salary of P7,000.00. They also agreed that he was entitled to an

additional commission of P100.00 per hour as recording

technician whenever a client uses the studio for recording, editing

or any related work. He was made to report for work from Monday

to Friday from 9:00 a.m. to 6 p.m. On Saturdays, he was required

to work half-day only, but most of the time, he still rendered eight

hours of work or more. All the employees of petitioner, including

respondent, rendered overtime work almost everyday, but

petitioner never kept a daily time record to avoid paying the

employees overtime pay.

 

Respondent stated that a few days after he started working

as a studio manager, petitioner approached him and told him

about his project to produce an album for his 15-year-old

daughter, Celine Mei Lirio, a former talent of ABS-CBN Star

Records. Petitioner asked respondent to compose and arrange

songs for Celine and promised that he (Lirio) would draft a

contract to assure respondent of his compensation for such

services. As agreed upon, the additional services that respondent

would render included composing and arranging musical scores

only, while the technical aspect in producing the album, such as

digital editing, mixing and sound engineering would be performed

by respondent in his capacity as studio manager for which he

was paid on a monthly basis.  Petitioner instructed respondent

that his work on the album as composer and arranger would only

be done during his spare time, since his other work as studio

manager was the priority. Respondent then started working on

the album.

 

Respondent alleged that before the end of September 2001,

he reminded petitioner about his compensation as composer and

arranger of the album. Petitioner verbally assured him that he

would be duly compensated. By mid-November 2001, respondent

finally finished the compositions and musical arrangements of the

songs to be included in the album. Before the month ended, the

lead and back-up vocals in the ten (10) songs were finally

recorded and completed. From December 2001 to January 2002,

respondent, in his capacity as studio manager, worked on digital

editing, mixing and sound engineering of the vocal and

instrumental audio files.

 

Thereafter, respondent was tasked by petitioner to prepare

official correspondence, establish contacts and negotiate with

various radio stations, malls, publishers, record companies and

manufacturers, record bars and other outlets in preparation for

the promotion of the said album. By early February 2002, the

album was in its manufacturing stage. ELECTROMAT,

manufacturer of CDs and cassette tapes, was tapped to do the

job. The carrier single of the album, which respondent composed

and arranged, was finally aired over the radio on February 22,

2002.

 

On February 26, 2002, respondent again reminded

petitioner about the contract on his compensation as composer

and arranger of the album. Petitioner told respondent that since

he was practically a nobody and had proven nothing yet in the

music industry, respondent did not deserve a high compensation,

and he should be thankful that he was given a job to feed his

family. Petitioner informed respondent that he was entitled only to

20% of the net profit, and not of the gross sales of the album, and

that the salaries he received and would continue to receive as

studio manager of Celkor would be deducted from the said 20%

net profit share. Respondent objected and insisted that he be

properly compensated. On March 14, 2002, petitioner verbally

terminated respondent’s services, and he was instructed not to

report for work.

 

Respondent asserts that he was illegally dismissed as he

was terminated without any valid grounds, and no hearing was

conducted before he was terminated, in violation of his

constitutional right to due process. Having worked for more than

six months, he was already a regular employee. Although he was

a so called “studio manager,” he had no managerial powers, but

was merely an ordinary employee.

 

Respondent prayed for his reinstatement without loss of

seniority rights, or, in the alternative, that he be paid separation

pay, backwages and overtime pay; and that he be awarded

unpaid commission in the amount of P2,000.00 for services

rendered as a studio technician as well as moral and exemplary

damages.

 

Respondent’s evidence consisted of the Payroll dated July

31, 2001 to March 15, 2002, which was certified correct by

petitioner, and Petty Cash Vouchers evidencing receipt of payroll

payments by respondent from Celkor.

 

In defense, petitioner stated in his Position Paper that

respondent was not hired as studio manager, composer,

technician or as an employee in any other capacity of Celkor.

Respondent could not have been hired as a studio manager,

since the recording studio has no personnel except petitioner.

Petitioner further claimed that his daughter Celine Mei Lirio, a

former contract artist of ABS-CBN Star Records, failed to come

up with an album as the latter aborted its project to produce one. 

Thus, he decided to produce an album for his daughter and

established a recording studio, which he named Celkor Ad

Sonicmix Recording Studio.  He looked for a composer/arranger

who would compose the songs for the said album. In July 2001,

Bob Santiago, his son-in-law, introduced him to respondent, who

claimed to be an amateur composer, an arranger with limited

experience and musician without any formal musical training.

According to petitioner, respondent had no track record as a

composer, and he was not known in the field of music.

Nevertheless, after some discussion, respondent verbally agreed

with petitioner to co-produce the album based on the following

terms and conditions:  (1) petitioner shall provide all the financing,

equipment and recording studio;   (2) Celine Mei Lirio shall sing

all the songs; (3) respondent shall act as composer and arranger

of all the lyrics and the music of the five songs he already

composed and the revival songs; (4) petitioner shall have

exclusive right to market the album; (5) petitioner  was entitled to

60% of the net profit, while respondent and Celine Mei Lirio were

each entitled to 20% of the net profit; and (6) respondent  shall be

entitled to draw advances of P7,000.00 a month, which shall be

deductible from his share of the net profits and only until such

time that the album has been produced.    

According to petitioner, they arrived at the foregoing sharing

of profits based on the mutual understanding that respondent was

just an amateur composer with no track record whatsoever in the

music industry, had no definite source of income, had limited

experience as an arranger, had no knowledge of the use of sound

mixers or digital arranger and that petitioner  would  help and

teach him how to use the studio equipment; that petitioner would

shoulder all the expenses of production and provide the studio

and equipment as well as his knowledge in the use thereof; and

Celine Mei Lirio would sing the songs. They embarked on the

production of the album on or about the third week of August

2002. 

 

Petitioner asserted that from the aforesaid terms and

conditions, his relationship with respondent is one of an informal

partnership under Article 1767 of the New Civil Code, since they

agreed to contribute money, property or industry to a common

fund with the intention of dividing the profits among themselves.

Petitioner had no control over the time and manner by which

respondent composed or arranged the songs, except on the result

thereof.  Respondent reported to the recording studio between

10:00 a.m. and 12:00 noon. Hence, petitioner contended that no

employer-employee relationship existed between him and the

respondent, and there was no illegal dismissal to speak of.

Whether or not there had been an illegal dismissal

Yes. Before a case for illegal dismissal can prosper, it must

first be established that an employer-employee relationship

existed between petitioner and respondent.

 

The elements to determine the existence of an employment

relationship are: (a) the selection and engagement of the

employee; (b) the payment of wages; (c) the power of dismissal;

and (d) the employer’s power to control the employee’s conduct.

The most important element is the employer’s control of the

employee’s conduct, not only as to the result of the work to be

done, but also as to the means and methods to accomplish it.

 

 

It is settled that no particular form of evidence is required to

prove the existence of an employer-employee relationship. Any

competent and relevant evidence to prove the relationship may be

admitted.

 

In this case, the documentary evidence presented by

respondent to prove that he was an employee of petitioner are as

follows:  (a) a document denominated as "payroll" (dated July 31,

2001 to March 15, 2002) certified correct by petitioner, which

showed that respondent received a monthly salary of P7,000.00

(P3,500.00 every 15th of the month and another P3,500.00 every

30th of the month) with the corresponding deductions due to

absences incurred by respondent; and (2) copies of petty cash

vouchers, showing the amounts he received and signed for in the

payrolls.

 

The said documents showed that petitioner hired respondent

as an employee and he was paid monthly wages of P7,000.00. 

Petitioner wielded the power to dismiss as respondent stated that

he was verbally dismissed by petitioner, and respondent,

thereafter, filed an action for illegal dismissal against petitioner. 

The power of control refers merely to the existence of the power. 

It is not essential for the employer to actually supervise the

performance of duties of the employee, as it is sufficient that the

former has a right to wield the power.  Nevertheless, petitioner

stated in his Position Paper that it was agreed that he would help

and teach respondent how to use the studio equipment. In such

case, petitioner certainly had the power to check on the progress

and work of respondent.

 

On the other hand, petitioner failed to prove that his

relationship with respondent was one of partnership. Such claim

was not supported by any written agreement.  The Court notes

that in the payroll dated July 31, 2001 to March 15, 2002, there

were deductions from the wages of respondent for his absence

from work, which negates petitioner’s claim that the wages paid

were advances for respondent’s work in the partnership.  In

Nicario v. National Labor Relations Commission, the Court held:

 

It is a well-settled doctrine, that if doubts exist between the evidence presented by the employer and the employee, the scales of justice must be tilted in favor of the latter. It is a time-honored rule that in controversies between a laborer and his master, doubts reasonably arising from the evidence, or in the interpretation of agreements and writing should be resolved in the former’s favor. The policy is to extend the doctrine to a greater number of employees who can avail of the benefits under the law, which is in consonance with the avowed policy of the State to give maximum aid and protection of labor. This rule should be applied in the case at bar, especially since the evidence presented by the private respondent company is not convincing. x x x

 

 

Based on the foregoing, the Court agrees with the Court of

Appeals that the evidence presented by the parties showed that

an employer-employee relationship existed between petitioner

and respondent. 

 

 In termination cases, the burden is upon the employer to

show by substantial evidence that the termination was for lawful

cause and validly made. Article 277 (b) of the Labor Code puts

the burden of proving that the dismissal of an employee was for a

valid or authorized cause on the employer, without distinction

whether the employer admits or does not admit the dismissal. For

an employee’s dismissal to be valid, (a) the dismissal must be for

a valid cause, and (b) the employee must be afforded due

process.  Procedural due process requires the employer to furnish

an employee with two written notices before the latter is

dismissed: (1) the notice to apprise the employee of the particular

acts or omissions for which his dismissal is sought, which is the

equivalent of a charge; and (2) the notice informing the employee

of his dismissal, to be issued after the employee has been given

reasonable opportunity to answer and to be heard on his

defense.  Petitioner failed to comply with these legal

requirements; hence, the Court of Appeals correctly affirmed the

Labor Arbiter’s finding that respondent was illegally dismissed,

and entitled to the payment of backwages, and separation pay in

lieu of reinstatement.

G.R. No. 168317 : November 21, 2011

DUP SOUND PHILS. and/or MANUEL TAN, Petitioners, v. COURT OF APPEALS and CIRILO A. PIAL, Respondents.

The instant petition arose from a complaint for illegal dismissal

filed by herein private respondent Cirilo A. Pial (Pial) on

November 5, 2001 with the NLRC, Quezon City. In his Position

Paper, Pial alleged that he was an employee of herein petitioner

DUP Sound Phils. (DUP), which is an entity engaged in the

business of recording cassette tapes for various recording

companies; petitioner Manuel Tan (Tan) is the owner and

manager of DUP; Pial was first employed in May 1988 until

December 1988; on October 11, 1991, he was re-employed by

DUP and was given the job of “mastering tape”; his main function

was to adjust the sound level and intensity of the music to be

recorded as well as arrange the sequence of the songs to be

recorded in the cassette tapes; on August 21, 2001, Pial got

absent from work because he got sick; when he got well the

following day and was ready for work, he called up their office in

accordance with his employer's policy that any employee who

gets absent shall first call their office before reporting back to

work; to his surprise, he was informed by the office secretary that

the latter was instructed by Tan to tell him not to report for work

until such time that they will advise him to do so; after three

weeks, without receiving any notice, Pial again called up their

office; this time the office secretary advised him to look for

another job because, per instruction of Tan, he is no longer

allowed to work at DUP; Pial asked the office secretary regarding

the reason why he was not allowed to return to his job and

pleaded with her to accept him back, but the secretary simply

reiterated Tan's order not to allow him to go back to work. Pial

prayed for the payment of his unpaid service incentive leave pay,

full backwages, separation pay, moral and exemplary damages

as well as attorney's fees.3

 

In their Position Paper, herein petitioners DUP and Tan denied

the material allegations of Pial contending that on or about

January 1996 they hired Pial as a laborer; on August 21, 2001,

the latter failed to report for work following an altercation with his

supervisor the previous day; on September 12, 2001, Pial called

up their office and informed the office secretary that he will be

going back to work on September 17, 2001; however, he failed to

report for work on the said date; petitioners were subsequently

surprised when they learned that Pial filed a complaint for illegal

dismissal against them; Pial was never dismissed, instead, it was

his unilateral decision not to work at DUP anymore; Tan even

offered him his old post during one of the hearings before the

NLRC hearing officer, but Pial refused such offer or any other

offer of amicable settlement.4

Whether or not there had been an illegal dismissal

Yes. The settled rule in labor cases is that the employer has the

burden of proving that the employee was not dismissed, or, if

dismissed, that the dismissal was not illegal, and failure to

discharge the same would mean that the dismissal is not justified

and, therefore, illegal.13 In the instant case, what betrays

petitioners' claim that private respondent was not dismissed from

his employment but instead abandoned his job is their failure to

prove that the latter indeed stopped reporting for work without any

justifiable cause or a valid leave of absence. Petitioners merely

presented the affidavits of their office secretary which narrated

their version of the facts. These affidavits, however, are not only

insufficient to prove their defense but also undeserving of

credence because they are self-serving.14

 

Moreover, considering the hard times in which we are in, it is

incongruous for private respondent to simply give up his work

without any apparent reason at all. No employee would recklessly

abandon his job knowing fully well the acute unemployment

problem and the difficulty of looking for a means of livelihood

nowadays. Certainly, no man in his right mind would do such

thing.15

 

Petitioners further claim that private respondent's absence

caused interruption in the workflow which caused damages to the

company. It is, thus, logical that petitioners would have wanted

private respondent to return to work in order to prevent further

loss on their part. In such a case, they could have immediately

sent private respondent a notice or show-cause letter at his last

known address requiring him to report for work, or to explain his

absence with a warning that his failure to do so would be

construed as abandonment of his work. However, petitioners

failed to do so. Moreover, if private respondent indeed abandoned

his job, petitioners should have afforded him due process by

serving him written notices, as well as a chance to explain his

side, as required by law. It is settled that, procedurally, if the

dismissal is based on a just cause under Article 28216 of the Labor

Code, the employer must give the employee two written notices

and a hearing or opportunity to be heard if requested by the

employee before terminating the employment: a notice specifying

the grounds for which dismissal is sought, a hearing or an

opportunity to be heard and, after hearing or opportunity to be

heard, a notice of the decision to dismiss.17 Again, petitioners

failed to do these. Thus, the foregoing bolsters private

respondent's claim that he did not abandon his work but was, in

fact, dismissed.

 

The consistent rule is that the employer must affirmatively show

rationally adequate evidence that the dismissal was for a

justifiable cause.18 In addition, the employer must also observe

the requirements of procedural due process. In the present case,

petitioners failed to submit sufficient evidence to show that private

respondent's dismissal was for a justifiable cause and in

accordance with due process.

 

The Court also agrees with private respondent that petitioners'

earnestness in offering re-employment to the former is suspect. It

was only after two months following the filing of the complaint for

illegal dismissal that it occurred to petitioners, in a belated gesture

of goodwill during one of the hearings conducted before the

NLRC, to invite private respondent back to work. If petitioners

were indeed sincere, they should have made their offer much

sooner. Under circumstances established in the instant case, the

Court doubts that petitioners' offer would have been made if

private respondent had not filed a complaint against them.

 

Neither may private respondent's refusal to report for work

subsequent to the Labor Arbiter's issuance of an order for his

reinstatement be considered as another abandonment of his job.

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.19 As defined under established jurisprudence,

abandonment is the deliberate and unjustified refusal of an

employee to resume his employment.20 It is a form of neglect of

duty, hence, a just cause for termination of employment by the

employer.21 For a valid finding of abandonment, these two factors

should be present: (1) the failure to report for work or absence

without valid or justifiable reason; and (2) a clear intention to

sever employer-employee relationship, with the second as the

more determinative factor which is manifested by overt acts from

which it may be deduced that the employee has no more intention

to work.22 The intent to discontinue the employment must be

shown by clear proof that it was deliberate and unjustified.23 In the

instant case, private respondent claimed that his subsequent

refusal to report for work despite the Labor Arbiter's order for his

reinstatement is due to the fact that he was subsequently made to

perform the job of a “bodegero” of which he is unfamiliar and

which is totally different from his previous task of “mastering

tape.” Moreover, he was assigned to a different workplace, which

is a warehouse, where he was isolated from all other employees.

The Court notes that petitioners failed to refute the foregoing

claims of private respondent in their pleadings filed with the CA. It

is only in their Reply filed with this Court that they simply denied

and brushed off private respondent's assertion that he was made

to work as a “bodegero.” The Court is, thus, led to conclude that

petitioners' failure to immediately refute the claims of private

respondent is an implied admission thereof. In the same vein, the

Court treats petitioners' belated denial of the same claims of

private respondent as mere afterthought which is not worthy of

credence.

 

G.R. No. 188169 : November 28, 2011

NIÑA JEWELRY MANUFACTURING OF METAL ARTS, INC. (otherwise known as NIÑA MANUFACTURING AND METAL ARTS, INC.) and ELISEA B. ABELLA, Petitioners, v. MADELINE C. MONTECILLO and LIZA M. TRINIDAD, Respondents.

Madeline Montecillo (Madeline) and Liza Trinidad (Liza), hereinafter

referred to collectively as the respondents, were first employed as goldsmiths by

the petitioner Niña Jewelry Manufacturing of Metal Arts, Inc. (Niña Jewelry) in

1996 and 1994, respectively. Madeline's weekly rate was P1,500.00 while Liza's

was P2,500.00. Petitioner Elisea Abella (Elisea) is Niña Jewelry's president and

general manager.

 

There were incidents of theft involving goldsmiths in Niña Jewelry's

employ.

 

On August 13, 2004, Niña Jewelry imposed a policy for goldsmiths

requiring them to post cash bonds or deposits in varying amounts but in no case

exceeding 15% of the latter's salaries per week. The deposits were intended to

answer for any loss or damage which Niña Jewelry may sustain by reason of the

goldsmiths' fault or negligence in handling the gold entrusted to them. The deposits

shall be returned upon completion of the goldsmiths' work and after an accounting

of the gold received.

 

Niña Jewelry alleged that the goldsmiths were given the option not to post

deposits, but to sign authorizations allowing the former to deduct from the latter's

salaries amounts not exceeding 15% of their take home pay should it be found that

they lost the gold entrusted to them. The respondents claimed otherwise insisting

that Niña Jewelry left the goldsmiths with no option but to post the deposits. The

respondents alleged that they were constructively dismissed by Niña Jewelry as

their continued employments were made dependent on their readiness to post the

required deposits.

 

Niña Jewelry averred that on August 14, 2004, the respondents no longer

reported for work and signified their defiance against the new policy which at that

point had not even been implemented yet.

 

On September 7, 2004, the respondents filed against Niña Jewelry

complaints for illegal dismissal and for the award of separation pay.

Whether there has been an illegal dismissal

No. Madeline Montecillo (Madeline) and Liza Trinidad (Liza), hereinafter

referred to collectively as the respondents, were first employed as goldsmiths by

the petitioner Niña Jewelry Manufacturing of Metal Arts, Inc. (Niña Jewelry) in

1996 and 1994, respectively. Madeline's weekly rate was P1,500.00 while Liza's

was P2,500.00. Petitioner Elisea Abella (Elisea) is Niña Jewelry's president and

general manager.

 

There were incidents of theft involving goldsmiths in Niña Jewelry's

employ.

 

On August 13, 2004, Niña Jewelry imposed a policy for goldsmiths

requiring them to post cash bonds or deposits in varying amounts but in no case

exceeding 15% of the latter's salaries per week. The deposits were intended to

answer for any loss or damage which Niña Jewelry may sustain by reason of the

goldsmiths' fault or negligence in handling the gold entrusted to them. The deposits

shall be returned upon completion of the goldsmiths' work and after an accounting

of the gold received.

 

Niña Jewelry alleged that the goldsmiths were given the option not to post

deposits, but to sign authorizations allowing the former to deduct from the latter's

salaries amounts not exceeding 15% of their take home pay should it be found that

they lost the gold entrusted to them. The respondents claimed otherwise insisting

that Niña Jewelry left the goldsmiths with no option but to post the deposits. The

respondents alleged that they were constructively dismissed by Niña Jewelry as

their continued employments were made dependent on their readiness to post the

required deposits.

 

Niña Jewelry averred that on August 14, 2004, the respondents no longer

reported for work and signified their defiance against the new policy which at that

point had not even been implemented yet.

 

On September 7, 2004, the respondents filed against Niña Jewelry

complaints for illegal dismissal and for the award of separation pay.

G.R. No. 191053 : November 28, 2011

MARIO B. DIMAGAN, Petitioner, v. DACWORKS UNITED, INCORPORATED AND/OR DEAN A. CANCINO, Respondents.

Sometime in 2002, petitioner was downgraded from his post as OIC to supervisor.

Then, in March of the following year, he was made to work as a mere technician.

When he vocally expressed his concerns regarding his assignments, one Loida

Aquino, who was in charge of servicing/personnel under the direct supervision of

respondent Dean A. Cancino, told him not to report for work anymore. Thereafter, a

certain Carlito Diaz, Operations Manager of respondent company, castigated

petitioner for not following Aquino's instruction to work as a technician. This

prompted petitioner to file a complaint for illegal dismissal, non-payment of overtime

pay, holiday pay, service incentive leave and separation pay against respondents.

 

 

Respondents denied that petitioner was illegally dismissed arguing that, since April 4,

2003 up to the time of the filing of the complaint, petitioner never reported for work

and continuously violated the company policy on absence without official leave

(AWOL). They allegedly sent a total of four (4) memoranda for the period August

2002 to March 2003 informing petitioner of his offenses, including being AWOL, but

he nonetheless unjustifiably refused to return to work.

In reply, petitioner denied ever receiving any one of the four memoranda allegedly

sent by respondents.

Wheter or not there had been constructive dismissal

Yes. Constructive dismissal is defined as a quitting because continued employment

is rendered impossible, unreasonable or unlikely; when there is a demotion in rank or

a diminution of pay.24 The test of constructive dismissal is whether a reasonable person

in the employee's position would have felt compelled to give up his position under the

circumstances. It is an act amounting to dismissal but is made to appear as if it were

not. Constructive dismissal is therefore a dismissal in disguise. The law recognizes

and resolves this situation in favor of employees in order to protect their rights and

interests from the coercive acts of the employer.25

 

 

As held in the case of Coca-Cola Bottlers Philippines, Inc. vs. Del Villar,26 the burden

falls upon the company to prove that the employee's assignment from one position to

another was not tantamount to constructive dismissal. In the case at bar, respondents

failed to discharge said burden. In fact, respondents never even disputed that petitioner

was relegated from the position of OIC to supervisor and, subsequently, to an ordinary

technician. Clearly, the reduction in petitioner's responsibilities and duties,

particularly from supervisor to ordinary technician, constituted a demotion in rank

tantamount to constructive dismissal.

 

 

Thus, contrary to the position of the CA, it is of no consequence that petitioner failed

to substantiate his allegation that Loida Aquino, an employee of respondent company,

informed him that he will be working as an ordinary technician, and that when he

openly voiced out his concern regarding the transfer, he was told not to report for

work anymore. As with all the other allegations made by petitioner, respondents never

disputed or rebutted this fact.

 

 

Similarly, We cannot concur with the finding of the CA that it was petitioner who

abandoned his employment by failing to report for work or having gone AWOL.

 

“Abandonment is the deliberate and unjustified refusal of an employee to resume his

employment.”27 To constitute abandonment of work, two elements must concur: “(1) the

employee must have failed to report for work or must have been absent without valid or

justifiable reason; and (2) there must have been a clear intention on the part of the employee to

sever the employer-employee relationship manifested by some overt act.”28 The employer bears

the burden of proof to show the deliberate and unjustified refusal of the employee to resume his

employment without any intention of returning.29

 

In the case of Hodieng Concrete Products, Inc. v. Emilia30, citing Samarca v. Arc-Men Industries,

Inc.31, the Court has ruled thus:

 

“x x x.  Absence must be accompanied by overt acts unerringly pointing to the fact that the employee simply does not want to work anymore.  And the burden of proof to show that there was unjustified refusal to go back to work rests on the employer.

 

x x x

 

Abandonment is a matter of intention and cannot lightly be presumed from certain equivocal acts.  To constitute abandonment, there must be clear proof of deliberate and unjustified intent to sever the employer-employee relationship. Clearly, the operative act is still the employee’s ultimate act of putting an end to his employment.

 

Settled is the rule that mere absence or failure to report for work is not tantamount to abandonment of work.  x x x.” (Emphasis supplied)

 

 

In this case, petitioner's failure to report for work was caused by the unwarranted demotion in

rank that was imposed upon him by respondents, not by any intention to sever employment ties

with them. And his filing of the instant complaint for illegal dismissal indubitably negates the

allegation of abandonment. Had petitioner intended to forsake his job, then he would not have

found it necessary to institute this case against respondents.

G.R. No. 192686 : November 23, 2011

FIL-STAR MARITIME CORPORATION, CAPTAIN VICTORIO S. MIGALLOS and GRANDSLAM ENTERPRISE CORPORATION, Petitioners, v. HANZIEL O. ROSETE, Respondent.

In 2005, petitioner Fil-Star Maritime Corporation (Fil-Star), the local

manning agency of co-petitioner Grandslam Enterprise Corporation (Grandslam),

hired respondent as third officer on board the ocean-going vessel “M/V Ansac

Asia.”  He was in charge of the loading and unloading operations of the vessel’s

cargo primarily consisting of soda ash in bulk.  Respondent stated that the nature of

his work exposed him to minute particles of soda ash during the loading and

unloading operations.  On November 22, 2005, respondent finished his contract

and returned to the Philippines.

 

 Thereafter, the petitioners re-hired respondent to work as second officer on

their vessel for a period of nine (9) months.  On January 5, 2006, respondent

underwent a pre-employment medical examination (PEME) with First Medical

Team Health Care Specialist Group, the company accredited physician, and was

pronounced “fit to work.”  On board the vessel, he was tasked to make an

inventory of the vessel’s property for annual inspection.  According to respondent,

he worked diligently and oftentimes worked odd hours just to familiarize himself

with his new job.  He averred that overtime work and the violent motions of the

vessel due to weather inclemency caused undue strain to his eyes and his physical

well-being.

 

 On February 14, 2006 or a little over a month from his embarkation,

respondent experienced an abrupt blurring of his left eye.  He reported it to his

captain and was advised to do an eye wash to relieve his pain until they reached

Chiba, Japan.  After the vessel arrived in Chiba, respondent was not able to seek

medical advice because he was tasked to man the ship’s navigation equipment. 

Five days later, respondent was able to receive medical attention in Kawasaki,

Japan.  Respondent was diagnosed with Central Retinal Vein Occlusion and

immediately underwent three rounds of laser surgery on February 28, 2006, March

2, 2006 and March 4, 2006.

 

On March 9, 2006, respondent was declared fit for travel and was

subsequently repatriated to the Philippines.  Upon arrival in Manila, respondent

went to the Metropolitan Hospital but could not get immediate treatment.  On

March 19, 2006, he experienced severe pain in his left eye so he insisted that he be

admitted to the hospital.  Respondent underwent another series of laser surgery on

March 22 and 25, April 6, 18, and 25, 2006. 

 

On August 11, 2006, Dr. Antonio Say declared respondent’s left eye to be

legally blind with poor possibility of recovery.  Relevant portions of the medical

certificate read:

 

A.   Left eye is legally blindB.   Partial permanent disability

        Partial because the visual activity of the right eye is 20/20.        It is permanent because the poor visual activity of the left eye,

hand movement, has poor prognosis for visual recovery.

 

The petitioners denied his claim for permanent total disability and only rated

his incapacity as Grade 7.  Respondent stressed that, under their Collective

Bargaining Agreement (CBA), he should be considered legally blind meriting

entitlement to permanent total disability benefits in the sum of US$105,000.00 for

being unable to perform his job for more than 120 days from his repatriation.

 

          Thus, on August 29, 2006, respondent filed a complaint against Fil-Star,

Capt. Victorio S. Migallos and Grandslam for disability benefits, damages and

attorney’s fees.

 

The petitioners averred that after almost a month aboard the vessel,

respondent complained of a sudden blurring of his left eye.  They referred him to

the Honmoku Hospital where a Dr. Yasuhiko Tomita diagnosed him with Central

Retinal Vein Occlusion, left eye and Neo-Vascular Glaucoma, left eye, suspicion.

After his repatriation, they immediately referred him to the Metropolitan Medical

Center where he was treated and underwent a series of Panretinal Photocoagulation

Session to prevent further neovascular formation.  They shouldered the expenses

for all these procedures.  They, however, argued that respondent was not qualified

for disability benefits, damages and attorney’s fees because his illness was not an

occupational disease or work-related.

Whether or not employee is entitled to disability benefits

Yes. There is no quibble that respondent is entitled to disability benefits.  The Standard

Employment Contract (SEC) for seafarers was created by the Philippine Overseas Employment

Administration (POEA) pursuant to its mandate under Executive Order (E.O.) No. 247 dated July

21, 1987 to “secure the best terms and conditions of employment of Filipino contract workers

and ensure compliance therewith” and to “promote and protect the well-being of Filipino

workers overseas.”

 

In this case, respondent was diagnosed with Central Retinal Vein Occlusion of his left

eye.  Central retinal vein occlusion is medically defined as the blockage of the central retinal

vein by a thrombus. It causes painless vision loss which is usually sudden, but it can also occur

gradually over a period of days to weeks.  This condition, despite numerous medical procedures

undertaken, eventually led to a total loss of sight of respondent’s left eye.  Loss of one bodily

function falls within the definition of disability which is essentially "loss or impairment of a

physical or mental function resulting from injury or sickness."

 

Although Central Retinal Vein Occlusion is not listed as one of the occupational diseases

under Section 32-A of the 2000 Amended Terms of POEA-SEC, the resulting disability which is

loss of sight of one eye, is specifically mentioned in Section 32 thereof (Schedule of Disability or

Impediment for Injuries Suffered and Diseases Including Occupational Diseases or Illness

Contracted).  More importantly, Section 20 (B), paragraph (4) states that “those illnesses not

listed in Section 32 of this Contract are disputably presumed as work-related.”

 

The disputable presumption that a particular injury or illness that results in disability, or

in some cases death, is work-related stands in the absence of contrary evidence.  In the case at

bench, the said presumption was not overturned by the petitioners.  Although, the employer is

not the insurer of the health of his employees, he takes them as he finds them and assumes the

risk of liability.  Consequently, the Court concurs with the finding of the courts below that

respondent’s disability is compensable.

 

Now, the Court shall determine whether respondent is entitled to be awarded permanent

total or permanent partial disability benefits.

 

It should be noted that the company-designated physician assessed the loss of

respondent’s left eye as a permanent partial disability while respondent’s own physician

indicated his disability as Grade 7.

 

The Court is more inclined to rule, however, that respondent is suffering from a

permanent total disability as he was unable to return to his job that he was trained to do

for more than one hundred twenty days already.  The recent case of Valenzona v. Fair

Shipping Corporation, et al., citing Quitoriano v. Jebsens Maritime, Inc.,  elucidated the

concept of permanent total disability, in this wise:

 

          Thus, Court has applied the Labor Code concept of permanent total disability to the case of seafarers. x x x                 x x x x                 There are three kinds of disability benefits under the Labor Code, as amended by P.D. No. 626: (1) temporary total disability, (2) permanent total disability, and (3) permanent partial disability. Section 2, Rule VII of the Implementing Rules of Book V of the Labor Code differentiates the disabilities as follows: 

Sec. 2. Disability. - (a) A total disability is temporary if as a result of the injury or sickness the employee is unable to

perform any gainful occupation for a continuous period not exceeding 120 days, except as otherwise provided for in Rule X of these Rules.

 (b) A disability is total and permanent if as a result of the

injury or sickness the employee is unable to perform any gainful occupation for a continuous period exceeding 120 days, except as otherwise provided for in Rule X of these Rules.

 

 (c) A disability is partial and permanent if as a result of

the injury or sickness the employee suffers a permanent partial loss of the use of any part of his body.

                 In Vicente v. ECC (G.R. No. 85024, January 23, 1991, 193 SCRA 190, 195): 

x x x the test of whether or not an employee suffers from 'permanent total disability' is a showing of the capacity of the employee to continue performing his work notwithstanding the disability he incurred. Thus, if by reason of the injury or sickness he sustained, the employee is unable to perform his customary job for more than 120 days and he does not come within the coverage of Rule X of the Amended Rules on Employees Compensability (which, in more detailed manner, describes what constitutes temporary total disability), then the said employee undoubtedly suffers from 'permanent total disability' regardless of whether or not he loses the use of any part of his body.

                 A total disability does not require that the employee be absolutely disabled or totally paralyzed. What is necessary is that the injury must be such that the employee cannot pursue his usual work and earn therefrom (Austria v. Court of Appeals, G.R. No. 146636, Aug. 12, 2002, 387 SCRA 216, 221). On the other hand, a total disability is considered permanent if it lasts continuously for more than 120 days. Thus, in the very recent case of Crystal Shipping, Inc. v. Natividad (G.R. No. 134028, December 17, 1999, 321 SCRA 268, 270-271), we held:                 Permanent disability is inability of a worker to perform his job for more than 120 days, regardless of whether or not he lose[s] the use of any part of his body. x x x                 Total disability, on the other hand, means the disablement of an employee to earn wages in the same kind of work of similar

nature that he was trained for, or accustomed to perform, or any kind of work which a person of his mentality and attainments could do. It does not mean absolute helplessness. In disability compensation, it is not the injury which is compensated, but rather it is the incapacity to work resulting in the impairment of one's earning capacity. [Emphasis and underscoring supplied]

 

A total disability does not require that the employee be completely disabled, or totally

paralyzed. What is necessary is that the injury must be such that the employee cannot pursue his

or her usual work and earn from it. On the other hand, a total disability is considered permanent

if it lasts continuously for more than 120 days.  What is crucial is whether the employee who suffers

from disability could still perform his work notwithstanding the disability he incurred.  Evidently,

respondent was not able to return to his job as a seafarer after his left eye was declared legally blind. 

Records show that the petitioners did not give him a new overseas assignment after his disability.  This

only shows that his disability effectively barred his chances to be deployed abroad as an officer of an

ocean-going vessel.

 

Therefore, it is fitting that respondent be entitled to permanent total disability benefits

considering that he would not able to resume his position as a maritime officer and the

probability that he would be hired by other maritime employers would be close to impossible. 

Indeed, a sight-impaired maritime applicant cannot stand in the same footing as his healthy co-

applicant.

 

G.R. No. 192881 : November 16, 2011

TAMSON’S ENTERPRISES, INC., NELSON LEE, LILIBETH ONG and JOHNSON NG, Petitioners, v. COURT OF APPEALS and ROSEMARIE L. SY, Respondents.

On February 24, 2007, four days before she completed her sixth month of

working in Tamson’s, Ng, the Sales Project Manager, called her to a meeting with

him and Lee.  During the meeting, they informed Sy that her services would be

terminated due to inefficiency.  She was asked to sign a letter of resignation and

quitclaim.  She was told not to report for work anymore because her services were

no longer needed.  On her last day of work, Ong humiliated her in front of her

officemates by shouting at her and preventing her from getting her personal things

or any other document from the office. 

 

          During her pre-employment interview, Lee had nice comments about her

good work experience and educational background.  She was assured of a long-

term employment with benefits.  Throughout her employment, she earnestly

performed her duties, had a perfect attendance record, worked even during

brownouts and typhoons, and would often work overtime just to finish her work.

 

Sy claimed that the remarks of her superiors about her alleged inefficiency

were ill-motivated and made without any basis.  She had been rendering services

for almost six (6) months before she was arbitrarily and summarily dismissed.  Her

dismissal was highly suspicious as it took place barely four (4) days prior to the

completion of her six-month probationary period.  The petitioners did not show her

any evaluation or appraisal report regarding her alleged inefficient performance.

As she was terminated without an evaluation on her performance, she was deprived

of the opportunity to be regularly part of the company and to be entitled to the

benefits and privileges of a regular employee.  Worse, she was deprived of her

only means of livelihood.

 

          For their part, the petitioners asserted that before Sy was hired, she was

apprised that she was being hired as a probationary employee for six months from

September 1, 2006 to February 28, 2007, subject to extension as a regular

employee conditioned on her meeting the standards of permanent employment set

by the company.  Her work performance was thereafter monitored and evaluated. 

On February 1, 2007, she was formally informed that her employment would end

on February 28, 2007 because she failed to meet the company’s standards. From

then on, Sy started threatening the families of the petitioners with bodily harm. 

They pointed out that the unpredictable attitude of Sy was one of the reasons for

her not being considered for regular employment.

 

          The foregoing circumstances prompted Sy to file a case for illegal dismissal

with claims for back wages, unpaid salary, service incentive leave, overtime pay,

13th month pay, and moral and exemplary damages, and attorney’s fees.

Whether or not a probationary employee has been illegally dismissed

No. The petitioners pray for the reversal of the CA decision arguing that Sy

was a probationary employee with a limited tenure of six months subject to

regularization conditioned on her satisfactory performance.  They insist that they

substantially complied with the requirements of the law having apprised Sy of her

status as probationary employee.  The standard, though not written, was clear that

her continued employment would depend on her over-all performance of the

assigned tasks, and that the same was made known to her since day one of her

employment.  According to the petitioners, reasonable standard of employment

does not require written evaluation of Sy’s function.   It is enough that she was

informed of her duties and that her performance was later rated below satisfactory

by the Management.

 

Citing Alcira v. NLRC and Colegio San Agustin v. NLRC, the petitioners

further argue that Sy’s constitutional protection to security of tenure ended on the

last day of her probationary tenure or on February 28, 2007.  It is unfair to compel

regularization of an employee who was found by the Management to be unfit for

the job.  As they were not under obligation to extend Sy’s employment, there was

no illegal dismissal, but merely an expiration of the probationary contract.   As

such, she was not entitled to any benefits like separation pay or backwages.    

 

  Sy counters that she was illegally terminated from service and insists that

the petitioners cannot invoke her failure to qualify as she was not informed of the

standards or criteria which she should have met for regular employment.

Moreover, no proof was shown as to her alleged poor work performance. She was

unceremoniously terminated to prevent her from becoming a regular employee and

be entitled to the benefits as such.

 

The Court finds the petition devoid of merit.

 

The pertinent law governing the present case is Article 281 of the Labor

Code which provides as follows:

 

Art. 281.  Probationary employment. — Probationary employment shall not exceed six 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 in 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. (Underscoring supplied)  

 

There is probationary employment where 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. The probationary

employment is intended to afford the employer an opportunity to observe the

fitness of a probationary employee while at work, and to ascertain whether he will

become an efficient and productive employee. While the employer observes the

fitness, propriety and efficiency of a probationer to ascertain whether he is

qualified for permanent employment, the probationer, on the other hand, seeks to

prove to the employer that he has the qualifications to meet the reasonable

standards for permanent employment. Thus, the word probationary, as used to

describe the period of employment, implies the purpose of the term or period, not

its length.

 

On the basis of the aforequoted provisions and definition, there is no dispute

that Sy’s employment with Tamson’s on September 1, 2006 was probationary in

character. As a probationary employee, her employment status was only

temporary.  Although a probationary or temporary employee with a limited tenure,

she was still entitled to a security of tenure. 

 

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 a 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.  Consistently, in Mercado

v. AMA Computer College-Paranaque City, Inc., this Court clearly stressed that:

Labor, for its part, is given the protection during the probationary period of knowing the company standards the new hires have to meet during the probationary period, and to be judged on the basis of these standards, aside from the usual standards applicable to employees after they achieve permanent status. Under the terms of the Labor Code, these standards should be made known to the [employees] on probationary status at the start of their probationary period, or xxx during which the probationary standards are to be applied. Of critical importance in invoking a failure to meet the probationary standards, is that the [employer] should show – as a matter of due process – how these standards have been applied. This is effectively the second notice in a dismissal situation that the law requires as a due process guarantee supporting the security of tenure provision, and is in furtherance, too, of the basic rule in employee dismissal that the employer carries the burden of justifying a dismissal. These

rules ensure compliance with the limited security of tenure guarantee the law extends to probationary employees. [Emphases supplied]

 

In this case, the justification given by the petitioners for Sy’s dismissal was

her alleged failure to qualify by the company’s standard.  Other than the general

allegation that said standards were made known to her at the time of her

employment, however, no evidence, documentary or otherwise, was presented to

substantiate the same.  Neither was there any performance evaluation presented to

prove that indeed hers was unsatisfactory.  Thus, this Court is in full accord with

the ruling of the CA when it wrote that:

 

Private respondents were remiss in showing that petitioner failed to qualify as a regular employee.  Except for their allegations that she was apprised of her status as probationary and that she would be accorded regular status once she meets their standards, no evidence was presented of these standards and that petitioner had been apprised of them at the time she was hired as a probationary employee.  Neither was it shown that petitioner failed to meet such standards.

 Petitioner should have been informed as to the basis of

private respondents’ decision not to extend her regular or permanent employment.  This case is bereft of any proof like an evaluation or assessment report which would support private respondents’ claim that she failed to comply with the standards in order to become a regular employee.

 One of the conditions before an employer can terminate a

probationary employee is dissatisfaction on the part of the employer which must be real and in good faith, not feigned so as to circumvent the contract or the law.  In the case at bar, absent any proof showing that the work performance of petitioner was unsatisfactory, We cannot conclude that petitioner failed to meet the standards of performance set by private respondents.  This absence of proof, in fact, leads Us to infer that their

dissatisfaction with her work performance was contrived so as not to regularize her employment.

 

For failure of the petitioners to support their claim of unsatisfactory

performance by Sy, this Court shares the view of the CA that Sy’s employment

was unjustly terminated to prevent her from acquiring a regular status in

circumvention of the law on security of tenure.  As the Court previously stated, this

is a common and convenient practice of unscrupulous employers to circumvent the

law on security of tenure. Security of tenure, which is a right of paramount value

guaranteed by the Constitution, should not be denied to the workers by such a

stratagem. The Court can not permit such a subterfuge, if it is to be true to the law

and social justice.   

 

          In its attempt to justify Sy’s dismissal, the petitioners relied heavily on the

case of Alcira v. NLRC where the Court stressed that the constitutional protection

ends on the expiration of the probationary period when the parties are free to either

renew or terminate their contract of employment.

 

          Indeed, the Court recognizes the employer’s power to terminate as an

exercise of management prerogative.  The petitioners, however, must be reminded

that such right is not without limitations.  In this connection,         it is well to quote

the ruling of the Court in the case of Dusit Hotel Nikko v. Gatbonton, where it was

written:

 

As Article 281 clearly states, a probationary employee can be legally terminated either: (1) for a just cause; or (2) when the employee fails to qualify as a regular employee in accordance with the reasonable standards made known to him by the employer at the start of the employment. Nonetheless, the power of the employer to terminate an employee on probation is not without limitations. First, this power must be exercised in accordance with the specific requirements of the contract. Second, the dissatisfaction on the part of the employer must be real and in good faith, not feigned so as to circumvent the contract or the law; and third, there must be no unlawful discrimination in the dismissal. In termination cases, the burden of proving just or valid cause for dismissing an employee rests on the employer. [Emphases supplied]

 

Here, the petitioners failed to convey to Sy the standards upon which she

should measure up to be considered for regularization and how the standards had

been applied in her case.  As correctly pointed out by Sy, the dissatisfaction on the

part of the petitioners was at best self-serving and dubious as they could not

present concrete and competent evidence establishing her alleged incompetence. 

Failure on the part of the petitioners to discharge the burden of proof is indicative

that the dismissal was not justified. 

 

The law is clear that 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. The

standards under which she would qualify as a regular employee not having been

communicated to her at the start of her probationary period, Sy qualified as a

regular employee.  As held by this Court in the very recent case of Hacienda

Primera Development Corporation v. Villegas,:

 

            In this case, petitioner Hacienda fails to specify the reasonable standards by which respondent’s alleged poor performance was evaluated, much less to prove that such standards were made known to him at the start of his employment.  Thus, he is deemed to have been hired from day one as a regular employee. Due process dictates that an employee be apprised beforehand of the condition of his employment and of the terms of advancement therein. [Emphasis supplied]

 

 

 

Even on the assumption that Sy indeed failed to meet the standards set by

them and made known to the former at the time of her engagement, still, the

termination was flawed for failure to give the required notice to Sy.  Section 2,

Rule I, Book VI of the Implementing Rules provides:

 

Section 2.  Security of tenure. – (a) In cases of regular employment, the employer shall not terminate the services of an employee except for just or authorized causes as provided by law, and subject to the requirements of due process.

 (b)  The foregoing shall also apply in cases of probationary

employment; Provided however, that in such cases, termination of employment due to failure of the employee to qualify in accordance with the standards of the employer made known to the former at the time of engagement may also be a ground for termination of employment. 

xxx

 (d)  In all cases of termination of employment, the

following standards of due process shall be substantially observed:

 xxx

 If the termination is brought about by the completion of a

contract or phase thereof, or by failure of an employee to meet the standards of the employer in the case of probationary employment, it shall be sufficient that a written notice is served the employee, within a reasonable time from the effective date of termination.  [Emphasis and Underscoring supplied]

 

In this case, the petitioners failed to comply with the requirement of a

written notice.  Notably, Sy was merely verbally informed that her employment

would be terminated on February 28, 2007, as admitted by the petitioners.

Considering that the petitioners failed to observe due process in dismissing her, the

dismissal had no legal sanction.  It bears stressing that a worker’s employment is

property in the constitutional sense. 

 

 

 

 

Being a regular employee whose termination was illegal, Sy is entitled to the

twin relief of reinstatement and backwages granted by the Labor Code.  Article

279 provides that an employee who is unjustly dismissed from work shall be

entitled to reinstatement without loss of seniority rights and other privileges, to her

full backwages, inclusive of allowances, and to her other benefits or their monetary

equivalent computed from the time her compensation was withheld from her up to

the time of actual reinstatement.  Likewise, having been compelled to come to

court and to incur expenses to protect her rights and interests, the award of

attorney’s fees is in order.

 

G.R. No. 195167 : November 16, 2011

FERNANDO CO (formerly doing business under the name “Nathaniel Mami House”*), Petitioner, v. LINA B. VARGAS, Respondent.