JULITO SAGALES, Petitioner, - versus - RUSTAN’S COMMERCIALCORPORATION, Respondent. THIRD DIVISION , G.R. No. 166554, November 27, 2008 REYES, R.T., J.: Facts: Petitioner Julito Sagales was employed by respondent Rustan’s Commercial Corporation from October 1970 until July 26, 2001, when he was terminated. At the time of his dismissal, he was occupying the position of Chief Cook at the Yum Yum Tree Coffee Shop. He was paid a basic monthly salary of P9,880.00. He was also receiving service charge of not less than P3,000.00 a month and other benefits under the law and the existing collective bargaining agreement between respondent and his labor union. In the course of his employment, petitioner was a consistent recipient of numerous citations for his performance. After receiving his latest award on March 27, 2001, petitioner conveyed to respondent his intention of retiring on October 31, 2001, after reaching thirty-one (31) years in service. Petitioner, however, was not allowed to retire with his honor intacts. On June 18, 2001, Security Guard Waldo Magtangob, upon instructions from Senior Guard Bonifacio Aranas, apprehended petitioner in the act of taking out from Rustan’s Supermarket a plastic bag. Upon examination, it was discovered that the plastic bag contained 1.335 kilos of squid heads worth P50.00. Petitioner was not able to show any receipt when confronted. Thus, he was brought to the Security Office of respondent corporation for proper endorsement to the Makati Headquarters of the Philippine National Police. Subsequently, petitioner was brought to the Makati Police Criminal Investigation Division where he was detained. Petitioner was later ordered released pending further investigation. On June 19, 2001, petitioner underwent inquest proceedings for qualified theft before Assistant Prosecutor Amado Y. Pineda. Although petitioner admitted that he was in possession of the plastic bag containing the squid heads, he denied stealing them because he actually paid for them. As proof, petitioner presented a receipt. The only fault he committed was his failure to immediately show the purchase receipt when he was accosted because he misplaced it when he changed his clothes. He also alleged that the squid heads were already “scraps” as these were not intended for cooking. Neither were the squid heads served to customers. He bought the squid heads so that they could be eaten instead of being thrown away. If he intended to steal from respondent, he could have stolen other valuable items instead of scrap. Assistant Prosecutor Pineda believed the version of petitioner and recommended the dismissal of the case for “lack of evidence.” The recommendation was approved upon review by the City Prosecutor. Notwithstanding the dismissal of the complaint, respondent, on June 25, 2001, required petitioner to explain in writing within forty-eight (48) hours why he should not be terminated in view of the June 18, 2001 incident. Respondent also placed petitioner under preventive suspension. Respondent did not find merit in the explanation of petitioner. Thus, petitioner was dismissed from service on July 26, 2001. At that time, petitioner had been under preventive suspension for one (1) month. Aggrieved, petitioner filed a complaint for illegal dismissal against respondent. He also prayed for unpaid salaries/wages, overtime pay, as well as moral and exemplary damages, attorney’s fees, and service charges. Issues: (1) Is the evidence on record sufficient to conclude that petitioner committed the crime charged? and (2) Assuming that the answer is in the affirmative, is the penalty of dismissal proper? Held: 1. YES. The evidence on record is sufficient to conclude that petitioner committed the crime charged. Security of tenure is a paramount right of every employee that is held sacred by the Constitution. The reason for this is that labor is deemed to be “property” within the meaning of constitutional guarantees. Indeed, as it is the policy of the State to guarantee the right of every worker to security of tenure as an act of social justice, such right should not be denied on mere speculation of any similar or unclear nebulous basis. Indeed, the right of every employee to security of tenure is all the more secured by the Labor Code by providing that “the employer shall not terminate the services of an employee except for a just cause or when authorized” by law. Otherwise, an employee who is illegally dismissed “shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages, inclusive of allowances, and to his other benefits or their monetary equivalent computed from the time his compensation was withheld from him up to the time of his actual reinstatement.” Necessarily then, the employer bears the burden of proof to show the basis of the termination of the employee. In the case at bar, respondent has discharged its onus of proving that petitioner committed the crime charged. We stress that the quantum of proof required for the application of the loss of trust and confidence rule is not proof beyond reasonable doubt. It is sufficient that there must only be some basis for the loss of trust and confidence or that there is reasonable ground to believe, if not to entertain the moral conviction, that the employee concerned is responsible for the misconduct and that his participation in the misconduct rendered him absolutely unworthy of trust and confidence. It is also of no moment that the criminal complaint for qualified theft against petitioner was dismissed. It is well settled that the conviction of an employee in a criminal case is not indispensable to the exercise of the employer’s disciplinary authority. 2. NO. The penalty of dismissal is too harsh under the circumstances. The free will of management to conduct its own business affairs to achieve its purpose cannot be denied. The only condition is that the exercise of management prerogatives should not be done in bad faith or with abuse of discretion. Truly, while the employer has the inherent right to discipline, including that of dismissing its employees, this prerogative is subject to the regulation by the State in the exercise of its police power. In this regard, it is a hornbook doctrine that infractions committed by an employee should merit only the corresponding penalty demanded by the circumstance. The penalty must be commensurate with the act, conduct or omission imputed to the employee and must be imposed in connection with the disciplinary authority of the employer. We do not condone dishonesty. After all, honesty is the best policy. However, punishment should be commensurate with the offense committed. The supreme penalty of dismissal is the death penalty to the working man. Thus, care should be exercised by employers in imposing dismissal to erring employees. The penalty of dismissal should be availed of as a last resort. SOLVIC INDUSTRIAL CORP. and ANTONIO C. TAM, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION and DIOSDADO LAUZ, respondents. [G.R. No. 125548. September 25, 1998] FIRST DIVISION PANGANIBAN, J.: Facts: Complainant started his employment with respondent sometime in 1977. He occupied the position as extruder operator. In the course of his employment, he performed his utmost best, and in fact has never been suspended or reprimanded. On 17 January 1994, sans cause or due process, he was arbitrarily terminated from service. Additionally, complainant alleged that he was not paid his service leave pay. Respondent on the other hand, averred that the complainant who was hired in 1977 was actually terminated for cause. That the termination of complainant arose from the incident that transpired on 17 January 1994 at about 7:00 p.m. On said occasion, complainant upon seeing Foreman Carlos Aberin confronted him and thereafter struck him in the shoulder beside the neck with a bladed weapon in the process, inflicting bodily injury on him. That several days after said incident, complainant did not report for work, hence, was issued a memorandum of preventive suspension. Correspondingly, Mr. Aberin executed an affidavit and submitted a medical certificate. Complainant on the other hand, submitted his letter of explanation denying complicity in the acts imputed to him. Thereafter, a series of administrative investigation was conducted where complainant refused to give any further statement or explanation. Subsequently, he was served his letter of termination dated 21 February 1994, which however, he refused to receive. Relatedly, in a meeting/conference held with the union officers by Carlos Aberin and Diosdado Lauz, complainant admitted to attempting to take the life of Mr. Aberin and apologized for the same. Respondents. Such act adversely affects the employer’s interests for it distracts employees. but omitting the award of back wages. The NLRC found that the wrong imputed to the private respondent did not merit the penalty of dismissal. Aberin with a bladed weapon. Issue: Whether or not the reinstatement of private respondent is proper.has already forgiven the private respondent. As found by Respondent NLRC. argued that complainant was given his day in court as an investigation was conducted. In fact. If the party most aggrieved -. and that the incident was not job related. the foreman -. Private respondent was accused of hitting the victim once with the blunt side of a bolo. We agree with the NLRC that the acts of private respondent are not so serious as to warrant the extreme penalty of dismissal. admitted that he assaulted the latter and even apologized in exchange for the withdrawal of the criminal case filed against him. It held that the imposition of the supreme penalty of dismissal is not commensurate with the gravity of the offense he committed. Aberin and with the union officers. on the other hand in reply. Private respondent could have attacked him with the blade of the weapon. Moreover. Fighting within work premises may be deemed a valid ground for the dismissal of an employee. complainant countered that he never struck Mr.In reply. thus negating any intent on his part to inflict fatal injuries. disrupts operations and creates a hostile work atmosphere. Held: YES. do not justify the dismissal of private respondent. ordering his reinstatement. the infraction was committed outside the work premises and did not lead to any disruption of work or any hostile environment in the work premises. hence cannot serve as basis for termination. Besides. then petitioner cannot be more harsh and condemning than the victim. no criminal or civil action has been . Thus. complainant in the course of his meeting with Mr. and he could have struck him several times. Petitioner’s arguments are not persuasive. The facts of this case.namely. But he did not. however. the victim merely sustained a minor abrasion and has since forgiven and reconciled with the private respondent. we do not condone the action of the private respondent. in his twenty years of service in the company. we reiterate that an employer’s power to discipline its workers must be exercised with caution. whatever missteps may be committed by labor ought not to be visited with a consequence so severe. The overly concern of our laws for the welfare of employees is in accord with the social justice philosophy. he has not been charged with any similar misconduct.” In so ruling. Furthermore. We believe. “our Labor Code decrees that an employee cannot be dismissed. lest it erode the constitutional guarantee of security of tenure. which leads to severance of employment ties and the economic dislocation of the employee. except for the most serious causes. however.instituted against private respondent. This is especially true when the penalty being imposed is dismissal. “Where a penalty less punitive would suffice. . Because of the serious implications of this penalty. that the NLRC did not commit grave abuse of discretion in ruling that the penalty of dismissal was too harsh and not commensurate with the said offense. Verily. in a letter. Inc. vs. allowances.. this resolution does not preclude the transfer of assignment of bank officers and employees from the branch office to the head office and vice-versa. the respondent informed petitioner that it was never the intention of management to downgrade his position in the bank considering that his due compensation as Bank Appraiser is maintained and no future reduction was intended.ELMER M. In his letter. MENDOZA. petitioner was one of the employees who were reshuffled to a new assignment without changes in their compensation and other benefits. RURAL BANK OF LUCBAN. petitioner again submitted a letter asking for another leave of absence for twenty days effective on the same date. issued several Board Resolutions which states that all officers and employees are subject to reshuffle of assignments. J. 1999. July 7. petitioner wrote to the management about such assignment. petitioner applied for a leave of absence from work for ten (10) days.: Facts: On April 25. G. the Board of Directors of the Rural Bank of Lucban. petitioner. The new assignments were to be effective on May 1. and other benefits received by the aforementioned employees. 1999.R. He was assigned as an appraiser and later assigned as a Clerk-Meralco Collection. he averred that his assignment is tantamount to a demotion without any legal basis. respondent. 2004. On June 21. . 1999 without changes in salary. No. 155421 . 1999. FIRST DIVISION PANGANIBAN. In its reply. However. On June 7. Pursuant to such Resolution. The respondent also said that the conduct of reshuffle is also a prerogative of bank management. Moreover. The fact that Mendoza was no longer included in the bank's payroll for July 1 to 15. Issue: Whether or not the reshuffling of private respondent's employees was done in good faith and cannot be made as the basis of a finding of constructive dismissal. The CA held that there was no grave abuse of discretion committed by the NLRC in issuing its decision. Jurisprudence recognizes the exercise of management prerogatives. Alejo B. this Petition. underpayment. petitioner brought before the CA. 1999 does not signify that the bank has dismissed the former from its employ. labor laws discourage interference in employers' . he filed the illegal dismissal case against his employer for no apparent reason at all. After the NLRC denied his Motion for Reconsideration. The reshuffling of its employees was done in good faith and cannot be made the basis of a finding of constructive dismissal. petitioner filed a Complaint before the NLRC for illegal dismissal. Indeed. On appeal. It also ordered the reinstatement of the complainant to his former position without loss of seniority rights with full backwages. while on leave. Daya. For this reason. even as the petitioner's demotion in rank is admitted by both parties. 1999.On June 24. Hence. he was not demoted as there was no diminution of his salary benefits and rank. while on his second leave of absence. courts often decline to interfere in legitimate business decisions of employers. Held: NO. 1999. It ruled thus that when Mendoza was reshuffled to the position of clerk at the bank. on June 24. Mendoza separated himself from the bank's employ when. the NLRC reversed the labor arbiter and held that there was no bad faith or malice to the respondent bank for its implementation of its Board Resolution directing the reshuffle of employees at its Tayabas branch to positions other than those they were occupying. The labor arbiter held that respondent is guilty of illegal dismissal. separation pay and damages against the Rural Bank of Lucban and/or its president. or effected as a form of punishment or demotion without sufficient cause. Thus.judgments concerning the conduct of their business. Likewise. constructive dismissal exists when an act of clear discrimination. This privilege is inherent in the right of employers to control and manage their enterprise effectively. management has the prerogative to transfer or assign employees from one office or area of operation to another provided there is no demotion in rank or diminution of salary. The right of employees to security of tenure does not give them vested rights to their positions to the extent of depriving management of its prerogative to change their assignments or to transfer them. and general principles of fair play and justice. The law must protect not only the welfare of employees. NLRC as follows: "Like other rights. there are limits thereto. and other privileges. collective bargaining agreements. inconvenient or prejudicial to the employee. as an offer involving a demotion in rank and diminution in pay. it cannot be used as a subterfuge by the employer to rid himself of an undesirable worker. which has been defined as a quitting because continued employment is rendered impossible. privileges and other benefits. are subject to limitations provided by law. however. The managerial prerogative to transfer personnel must be exercised without grave abuse of discretion. Having the right should not be confused with the manner in which that right is exercised. Managerial prerogatives. the employee's transfer shall be tantamount to constructive dismissal. In particular. insensibility or disdain by an employer has become so unbearable to the employee leaving him with no option but to forego with his continued employment. but also the right of employers. The test for determining the validity of the transfer of employees was explained in Blue Dairy Corporation v. made in bad faith. and the action is not motivated by discrimination. bearing in mind the basic elements of justice and fair play. benefits. Should the employer fail to overcome this burden of proof. the employer must be able to show that the transfer is not unreasonable. nor does it involve a demotion in rank or a diminution of his salaries." . In the pursuit of its legitimate business interest. unreasonable or unlikely. 76645 . G. 1991. Mrs. Sometime in March 1984. simply PT & T). respondents. . Facts: Alicia Laplana was the cashier of the Baguio City Branch Office of the Philippine Telegraph and Telephone Corporation (hereafter. petitioner. other accountable forms and files to Rose Caysido who will be in charge of cashiering in Baguio. and other miscellaneous expenses. No. used and unused official receipts. directed Laplana to transfer to the company's branch office at Laoag City. Laplana refused the reassignment and proposed instead that qualified clerks in the Baguio Branch be trained for the purpose. July 23. J. vs. Arogo reiterated her directive for Laplana's transfer to the Laoag Branch.PHILIPPINE TELEGRAPH AND TELEPHONE CORPORATION. she will be reassigned to Laoag branch assuming the same position of branch cashier and ordering her to turn over your accountabilities such as PCF. RICARDO ENCARNACION. this time in the form of a written Memorandum. 1984. PT & T's treasurer. and NATIONAL LABOR RELATIONS COMMISSION. On April 12. her salary alone will not be enough for her family. Mrs. Hon. As a result. Arogo. FIRST DIVISION NARVASA. informing Laplana that effective April 16. 1984. ALICIA LAPLANA. fare. She set out her reasons therefor in her letter that she have already established Baguio City as her permanent residence and that working in Laoag will involve additional expenses for her part like her board and lodgingly.R. Alicia A. undeposited collections. " although the truth is. the Defendants made good its warning by terminating her services on May 16. 1989 the Court held that it is the employer's prerogative. promulgated on March 8. In answer. and . On October 9." Issue: Whether or not Laplana’s termination is legal. that when she insisted on her right of refusing to be transferred. aptitudes. based on its assessment and perception of its employees' qualifications. Termination of Laplana's employment on account of retrenchment thereupon followed. she was forced to be terminated and that there was no ground at all for the retrenchment.Apparently Laplana was not allowed to resume her work as Cashier of the Baguio Branch when April 16. v. She thereupon wrote again to Mrs. 1984. a complaint against PT & T its Baguio Northwestern Luzon Branch. On July 4. as right of action. and Paraluman Bautista. Lastly. the defendants alleged that Laplana was being transferred to Laoag City because of increase in sales due to the additional installations of vodex line. Laplana signed the quitclaim and received the check representing her 13th month and separation pay. 1984. In her complaint she alleged. In Philippine Japan Active Carbon Corp. Area Manager. Arogo ordering her to report to Manila for a ner job assignment but the same was refused by petitioner and asked that she be retrenched instead. Laplana received a telegram from Mrs. reiterating the reasons already given by her in her first letter. 1984 on alleged ground of "retrenchment. they also alleged that the company was exercising management prerogatives in transferring complainant and there is no showing that this exercise was arbitrarily and whimsically done. that the company's act of transferring is not only without any valid ground but also arbitrary and without any purpose but to harass and force her to eventually resign. Arogo advising that the directed transfer was unacceptable. NLRC. Laplana's services were terminated on her explicit declaration that "she was willing to be retrenched rather than be assigned to Laoag City or Manila. Subsequently. 1984 came. Laplana filed with the Labor Arbiters' Office at Baguio City. Held: YES. thru the CLAO. Baguio City. . the employee may not complain that it amounts to a constructive dismissal. There is no showing whatever that the employer was transferring Laplana to another work place.competence. in response to that plea not to be moved to the Laoag Office. nor inconvenient. When his transfer is not unreasonable. in fact. not because she would be more useful there. but merely as a subterfuge to rid itself of an undesirable worker. it is the employee's wishes that should be made to prevail. or to penalize an employee for union activities. In this case. herself suggesting the reason therefor –– retrenchment. The situation here presented is of an employer transferring an employee to another office in the exercise of what it took to be sound business judgment and in accordance with pre-determined and established office policy and practice. rooted in considerations of personal convenience and difficulties for the family. the Court cannot accept the proposition that when an employee opposes his employer's decision to transfer him to another work place. to move them around in the various areas of its business operations in order to ascertain where they will function with maximum benefit to the company. of her voluntary termination of her employment and the delivery to her of corresponding separation pay. and of the latter having what was believed to be legitimate reasons for declining that transfer. and it does not involve a demotion in rank or diminution of his salaries. nor prejudicial to him. An employee's right to security of tenure does not give him such a vested right in his position as would deprive the company of its prerogative to change his assignment or transfer him where he will be most useful. the main office. Certainly. she accepted separation pay. and other privileges. the solution proposed by the employee herself. When so dismissed. in deciding to transfer her to another office. She had unequivocally asked that she be considered dismissed. The employer was moreover not unmindful of Laplana's initial plea for reconsideration of the directive for her transfer to Laoag. would appear to be the most equitable. there being no bad faith or underhanded motives on the part of either party. the employee (Laplana) had to all intents and purposes resigned from her position. benefits. Under these circumstances. the employer has not been shown to be acting otherwise than in good faith. and in the legitimate pursuit of what it considered its best interests. On the other hand. offering at the same time the normal benefits attendant upon transfers from an office to another. the employer opted instead to transfer her to Manila. ALLIED BANKING CORPORATION.: Facts: Private respondent Potenciano Galanida was hired by petitioner Allied Banking Corporation on 11 January 1978 and rose from accountant-book keeper to assistant manager in 1991. 144412. COURT OF APPEALS and POTENCIANO L. His appointment was covered by a “ notice of personnel action” which provided as one of the conditions of employment the provision on petitioner’s right to transfer employees as the need arises and in the interest of maintaining smooth and uninterrupted service to the public.respondents. petitioner.R. vs. GALANIDA.The termination of services of private respondent is declared legal and proper. 2003] FIRST DIVISION CARPIO. Effecting a rotation/movement of officers assigned in the Cebu homebase. No. petitioner listed respondent as second in the order of priority of assistant managers to be assigned outside of Cebu City having been stationed in Cebu . November 18. Private respondent was promoted several times and was transferred to several branches. [G. J. He then filed a complaint before the Labor Arbiter for constructive dismissal. Cebu City branch After several hearings. Respondent was also given an opportunity to explain why no disciplinary action should be meted against him for refusing to follow instructions concerning the transfer and reassignment. Subsequently. he charged Allied Bank with discrimination and favoritism in ordering his transfer. petitioner bank informed private respondent that he was to report to the Tagbilaran City Branch effective 23 May 1994. the NLRC likewise ruled that Allied Bank terminated Galanida without just cause. On appeal. Petitioner also invoked its right to transfer employees as the need arises and in the interest of maintaining smooth and uninterrupted service to the public. and the anguish that would result if he is away from his family. Petitioner also warned respondent that her refusal to follow instruction concerning his transfer and reassignment to Bacolod City and to Tagbilaran City is penalized under Article XII of the Bank’s Employee Discipline Policy and Procedure. On 16 June 1994. Galanida replied that whether the bank’s penalty for his refusal be Suspension or Dismissal it will all the more establish and fortify his complaint now pending before the NLRC. The NLRC agreed that the transfer order was unreasonable and unjustified. The Labor Arbiter reasoned that Galanida’s transfer was inconvenient and prejudicial because Galanida would have to incur additional expenses for board. In case of refusal. expenses. Private respondent manifested his refusal to be transferred to Bacolod City in a letter citing as reason parental obligations. On 5 October 1994. lodging and travel. In ruling that Galanida’s refusal to transfer did not amount to insubordination. Galanida received an inter-office communication stating that Allied Bank had terminated his services effective 1 September 1994 for his continued refusal to be transferred from the Jakosalem. considering the family considerations .for seven years already. In the same letter. On the other hand. the Labor Arbiter held that Allied Bank failed to show any business urgency that would justify the transfer. Subsequently. the Labor Arbiter held that Allied Bank had abused its management prerogative in ordering the transfer of Galanida to its Bacolod and Tagbilaran branches. the penalty may range from suspension to dismissal as determined by management. petitioner warned and required of private respondent that tthere is no discrimination in her transfer. Private respondent refused. provided the transfer does not result in demotion in rank or diminution of the employee’s salary. The appellate court agreed that Allied Bank did not afford Galanida procedural due process because there was no hearing and no notice of termination. inconvenient and prejudicial to the displaced employee. an assistant manager. The employer exercises the prerogative to transfer an employee for valid reasons and according to the requirement of its business. Allied Bank filed a motion for reconsideration which the appellate court denied. The NLRC found unlawful discrimination since Allied Bank did not transfer several junior accountants in Cebu. The Memo merely stated that the bank would issue a notice of termination but there was no such notice.mentioned by Galanida. The NLRC characterized the transfer as a demotion since the Bacolod and Tagbilaran branches were smaller than the Jakosalem branch. The rule is that the transfer of an employee ordinarily lies within the ambit of the employer’s prerogatives. the employer has the burden of showing that the transfer is not unnecessary. benefits and other privileges. It also enables bank employees to gain the necessary experience for eventual . Dissatisfied. Hence this petition. The constant transfer of bank officers and personnel with accounting responsibilities from one branch to another is a standard practice of Allied Bank. Issue: Whether under the facts presented there is legal basis in petitioner’s exercise of its management prerogative. Allied Bank filed a petition for review questioning the Decision and Resolution of the NLRC before the Court of Appeals. Held: YES. and because the bank wanted Galanida. The appellate court ruled that the transfer from a regional office to the smaller Bacolod or Tagbilaran branches was effectively a demotion. which has more than a hundred branches throughout the country. Allied Bank does this primarily for internal control. a regional office. Allied Bank filed a motion for reconsideration which the NLRC denied. to replace an assistant accountant in the Tagbilaran branch. The Court of Appeals held that Galanida’s refusal to comply with the transfer orders did not warrant his dismissal. In illegal dismissal cases. The employer has the prerogative. and that the transfer would involve the same rank. Neither was Galanida’s transfer in the nature of a demotion. Allied Bank did not single out Galanida.” Galanida was well aware of Allied Bank’s policy of periodically transferring personnel to different branches. Galanida did not present evidence showing that the transfer would diminish his salary. Allied Bank’s letter of 13 June 1994 showed that at least 14 accounting officers and personnel from various branches. based on its assessment of the employees’ qualifications and competence. Instead. in its Manual of Regulations for Banks and Other Financial Intermediaries. were transferred to other branches. including Galanida. . to rotate them in the various areas of its business operations to ascertain where they will function with maximum benefit to the company. The evidence on record contradicts the charge that Allied Bank discriminated against Galanida and was in bad faith when it ordered his transfer.promotion. duties and obligations. Allied Bank assured Galanida that he would not suffer any reduction in rank or grade. Assistant Manager Roberto Isla. benefits or other privileges. The person first in line. The Bangko Sentral ng Pilipinas. Galanida consented to this condition when he signed the Notice of Personnel Action. requires the rotation of these personnel. assignment to the different branches of Allied Bank was a condition of Galanida’s employment. The same letter explained that Galanida was second in line for assignment outside Cebu because he had been in Cebu for seven years already. unannounced and long enough to permit disclosure of any irregularities or manipulations. had already transferred to a branch in Cagayan de Oro City. As the Court of Appeals found. who had been in Cebu for more than ten years. securities and bookkeeping records should be rotated” and that such rotation “should be irregular. We note that none of the other transferees joined Galanida in his complaint or corroborated his allegations of widespread discrimination and favoritism. The Manual directs that the “duties of personnel handling cash. respondent filed against petitioner a complaint for illegal dismissal alleging that he was dismissed from service effective immediately by virtue of a memorandum. 147790. On November 18. after which he was not allowed anymore to enter the company premises. Petitioner countered that he was not illegally dismissed.e.: Facts: Alfonso Magpantay (respondent) was employed as a machine operator with Genuino Ice Company.GENUINE ICE COMPANY INC. . Petitioner. FIRST DIVISION AUSTRIA-MARTINEZ. he led an illegal strike at petitioner’s sister company. Genuino Agro Industrial Development Corporation.. 1996. i. Petitioner also maintained that respondent’s dismissal was made after he was accorded due process. since the dismissal was based on a valid ground. (petitioner) from March 1988 to December 1995. 1995. G. Respondent.R. June 27. Inc. Respondent bewailed that his termination from employment was done without due process.versus – ALFONSO S. J. . MAGPANTAY. No. 2006. resulting in big operation losses on the latter’s part. which lasted from November 18 to 22.. however. and the matter was reported only after the new personnel manager assumed his position in August 1996. and that his four-day absence does not appear to be both gross and habitual.Respondent replied. Cavite Plant constituted insubordination or willful disobedience. Both the Labor Arbiter and the NLRC were one in concluding that petitioner had just cause for dismissing respondent. The Court sustains the CA’s finding that respondent’s four-day absence does not amount to a habitual neglect of duty. however. however. and breach of trust. (c) fraud or willful breach by the employee of the trust reposed in him by his employer or duly authorized representative. make up a cause for habitual neglect of duties. (b) gross and habitual neglect by the employee of his duties. and his failure to perform his duties during such absence. (d) commission of a crime or offense by the employee against the person of his employer or any immediate member of his family or . gross and habitual neglect of duties. that assuming that he led such illegal strike. since it came out during respondent’s cross-examination. The CA. Issue: Whether or not the respondent was illegally dismissed from employment. while his failure to comply with petitioner’s order for him to transfer to the GMA. as amended. differed with said conclusion and found that respondent’s attitude “has not been proved to be visited with any wrongdoing”. Held: No. as his act of leading a strike at petitioner’s company for four days. Under Article 282 of the Labor Code. petitioner amended its position paper to include insubordination among the grounds for his dismissal. the Court finds that respondent was validly dismissed on ground of willful disobedience or insubordination. his absence from work during such time. he could not be liable therefore because it was done in petitioner’s sister company which is a separate and distinct entity from petitioner. Subsequently. Petitioner initially claimed that respondent’s acts were tantamount to serious misconduct or willful disobedience. an employer may terminate an employment for any of the following causes: (a) serious misconduct or willful disobedience by the employee of the lawful orders of his employer or representative in connection with his work. . must be both gross and habitual.his duly authorized representative. to be a ground for dismissal. petitioner. Neglect of duty. Thus. Habitual neglect implies repeated failure to perform one’s duties for a period of time. PHILIPPINE DUPLICATORS. therefore. INC. NATIONAL LABOR RELATIONS COMMISSION and PHILIPPINE DUPLICATORS EMPLOYEES UNION-TUPAS. A productivity bonus is something extra for which no specific additional services are rendered by any particular employee and hence not legally demandable. absent a contractual undertaking to pay it. Productivity bonuses are not directly dependent on the extent an individual employee exerts himself. No. On the other hand. EN BANC FELICIANO. (e) other causes analogous to the foregoing. 1995. The employer has the burden of proving that the dismissal was for a just cause. the single or isolated act of negligence does not constitute a just cause for the dismissal of the employee. G.respondents. J. Gross negligence connotes want of care in the performance of one’s duties.: Facts: This Case differentiates Productivity Bonuses and Commissions Productivity bonuses are generally tied to the productivity or profit generation of the employer corporation. 110068 February 15. Commissions are paid upon the specific results achieved by a salesman- .R. and. fraud and willful neglect of duties imply bad faith on the part of the employee in failing to perform his job to the detriment of the employer and the latter’s business. failure to show this would necessarily mean that the dismissal was unjustified and. illegal. Sales commissions are intimately related to or directly proportional to the extent or energy of an employee's endeavours. depending upon the circumstances. vs. such bonuses closely resemble profitsharing payments and have no clear director necessary relation to the amount of work actually done by each individual employee. – Yes 2. . are properly excluded from the ambit of the term "basic salary" for purposes of computing the 13th month pay due to employees. Issue: 1. Additional payments made to employees.WON Productivity bonus shall be considered as part of wages in 13th month pay – No Held: 1. Overtime pay. to the extent they partake of the nature of profit-sharing payments. then it cannot be considered part of basic salary when time comes to compute 13th month pay. The Supplementary Rules and Regulations Implementing P. More generally.WON The commissions received by the salesmen were part of the”wages” to be considered for their 13thmonth pay.The commissions were an integral part of the pay of the workers. or capacity for revenue production. 4. a bonus is an amount granted and paid ex gratia to the employee.851 subsequently issued by former Labor Minister Ople sought to clarify the scope of items excluded in the computation of the 13thmonth pay.:Sec. No. 2. its payment constitutes an act of enlightened generosity and self-interest on the part of the employer. viz . considering that the fixed wage was only 30% of what they were normally receiving. Such additional payments are not "commissions" within the meaning of the second paragraph of Section 5 (a) of the Revised Guidelines Implementing13th Month Pay.Productivity bonuses are generally tied to the productivity. Since productivity bonus is not demandable.D. It is a percentage of the sales closed by a salesman and operates as an integralpart of such salesman's basic pay. earnings and other remunerations which are not part of the basic salary shall not be included in the computation of the 13th month pay.employee. rather than as a demandable or enforceable obligation. of a corporation. Eastern Telecoms Employees Union (ETEU) is the certified exclusive bargaining agent of the company’s rank and file employees with a strong following of 147 regular members.EASTERN TELECOMS EMPLOYEES UNION. (ETPI) is a corporation engaged in the business of providing telecommunications facilities. regular landlines. February 8. employing approximately 400 employees.: Facts: Eastern Telecommunications Phils. particularly leasing international date lines or circuits. THIRD DIVISION MENDOZA. INC. It has an existing collective bargaining . 185665. internet and data services. 2012.EASTERN TELECOMMUNICATIONS PHILIPPINES.versus . No. Inc. J. G.. Respondent.R. Petitioner.. even when it did not realize any net profits. Likewise. ETEU posited that by reason of its long and regular concession. the NLRC found that ETPI was not guilty of the ULP charge elaborating that no sufficient and substantial evidence was adduced to attribute malice to the company for its refusal to pay the subject bonuses. such refusal was nothing but a ploy to spite the union for bringing the matter of delay in the payment of the subject bonuses to the National Conciliation and Mediation Board (NCMB).agreement with the company to expire in the year 2004 with a Side Agreement signed on September 3. Respondent ETEU moved for reconsideration but the motion was denied by the NLRC. 15th and 16th month bonuses for the year 2003 and the 14th month bonus for the year 2004 inasmuch as the payment of these additional benefits was basically a management prerogative. Inc. The NLRC dismissed ETEU’s complaint and held that ETPI could not be forced to pay the union members the 14th. ETEU contended that the unjustified and malicious refusal of the company to pay the subject bonuses was a clear violation of the economic provision of the CBA and constitutes unfair labor practice (ULP). . (ETPI) had consistently and voluntarily been giving out 14th month bonus during the month of April. According to ETEU. The NLRC pronounced that ETPI may not be obliged to pay these extra compensations in view of the substantial decline in its financial condition. ETEU theorized that the grant of the subject bonuses is not only a company practice but also a contractual obligation of ETPI to the union members. being an act of generosity and munificence on the part of the company and contingent upon the realization of profits. and 15th and 16th month bonuses every December of each year (subject bonuses) to its employees from 1975 to 2002. The Eastern Telecoms Employees Union (ETEU) claimed that Eastern Telecommunications Philippines. It prayed for the award of moral and exemplary damages as well as attorney’s fees for the unfair labor practice allegedly committed by the company. the payment of these monetary benefits had ripened into a company practice which could no longer be unilaterally withdrawn by ETPI. ETEU added that this longstanding company practice had been expressly confirmed in the Side Agreements of the 1998-2001 and 2001-2004 Collective Bargaining Agreements(CBA) which provided for the continuous grant of these bonuses in no uncertain terms. 2001. Inc. then it is part of the wage. If it is additional compensation which the employer promised and agreed to give without any conditions imposed for its payment. v. Issue: 1. Where it is not payable to all but only to some . Whether the members of ETEU are entitled to the payment of 14th. however. can these bonuses be considered part of the wage. where it was written: Whether or not a bonus forms part of wages depends upon the circumstances and conditions for its payment. a bonus is a gratuity or act of liberality of the giver which the recipient has no right to demand as a matter of right. It also found that the grant of said bonuses has already ripened into a company practice and their denial would amount to diminution of the employees’ benefits. Stated differently. it cannot be considered part of the wage. 15th and 16th month bonuses for the year 2003 and 14th month bonus for year 2004.Aggrieved. But if it is paid only if profits are realized or if a certain level of productivity is achieved. Particularly instructive is the ruling of the Court in Metro Transit Organization. such as success of business or greater production or output. YES. 2. A bonus. From a legal point of view. The grant of a bonus is basically a management prerogative which cannot be forced upon the employer who may not be obliged to assume the onerous burden of granting bonuses or other benefits aside from the employee’s basic salaries or wages. salary or compensation making them enforceable obligations? Held: 1. ETEU filed a petition for certiorari before the CA ascribing grave abuse of discretion on the NLRC for disregarding its evidence which allegedly would prove that the subject bonuses were part of the union members’ wages. becomes a demandable or enforceable obligation when it is made part of the wage or salary or compensation of the employee. National Labor Relations Commission. Whether these bonuses are demandable or not. The CA declared that the Side Agreements of the 1998 and 2001 CBA created a contractual obligation on ETPI to confer the subject bonuses to its employees without qualification or condition. salaries or compensations. not a part of the wage. it is presumed that it entered into the Side Agreements voluntarily. Verily. Neither does it state that if the company derives no profits. the grant of 14th. no bonuses are to be given to the employees. In fine. 15th and 16th month bonuses has become more than just an act of generosity on the part of ETPI but a contractual obligation it has undertaken. it is only an inducement for efficiency. The rule is settled that any benefit and supplement being enjoyed by the employees cannot be reduced. 2.employees and only when their labor becomes more efficient or more productive. the continuous conferment of bonuses by ETPI to the union members from 1998 to 2002 by virtue of the Side Agreements evidently negates its argument that the giving of the subject bonuses is a management prerogative. Terse and clear. the said provision does not state that the subject bonuses shall be made to depend on the ETPI’s financial standing or that their payment was contingent upon the realization of profits. A reading of the CBA provision reveals that the same provides for the giving of 14th. such intention should have been expressly declared in the Side Agreements or the bonus provision should have been deleted altogether. There were no conditions specified in the CBA Side Agreements for the grant of the benefits contrary to the claim of ETPI that the same is justified only when there are profits earned by the company. by virtue of its incorporation in the CBA Side Agreements. diminished. Indeed. 15th and 16th month bonuses without qualification. . The wording of the provision does not allow any other interpretation. mistake or duress. The principle of non-diminution of benefits is founded on the constitutional mandate to protect the rights of workers and to promote their welfare and to afford labor full protection. YES. a prize therefore. In the absence of any proof that ETPI’s consent was vitiated by fraud. discontinued or eliminated by the employer. that it had full knowledge of the contents thereof and that it was aware of its commitment under the contract. Moreover. if ETPI and ETEU intended that the subject bonuses would be dependent on the company earnings. The records are also bereft of any showing that the ETPI made it clear before or during the execution of the Side Agreements that the bonuses shall be subject to any condition. the payment of these bonuses was not related to the profitability of business operations. R. entered into a Collective Bargaining . J. -versusMANILA JOCKEY CLUB. FIRST DIVISION GARCIA. Petitioner. Inc.: Facts: Petitioner Manila Jockey Club Employees Labor Union-PTGWO and respondent Manila Jockey Club. No. 167760.MANILA JOCKEY CLUB EMPLOYEES LABOR UNION. operate and maintain horse races.. G. INC.PTGWO. Respondent. March 7. a corporation with a legislative franchise to conduct.. 2007. 1999. On April 3. petitioner and respondent entered into an Amended and Supplemental CBA and clarified that any conflict arising therefrom shall be referred to a voluntary arbitrator for resolution.m. to 9:00 p. every Tuesday and Thursday. when horse races are held. Accordingly. before a panel of voluntary arbitrators of the National Conciliation and Mediation Board (NCMB). to 5:00 p. effective April 20. Article IV. 1999. of the CBA which specified the work schedule of respondent's employees to be from 9:00 a. to 8:00 p. including the determination of the work schedule.m. 2000. .m. while work rendered in excess of seven hours on legally mandated holidays and rest days not falling within the aforestated categories day shall be additionally compensated for the overtime work equivalent to his rate for the first seven hours on a legally mandated holiday or rest day plus thirty percent (30%) thereof. 1999. the hours of work of regular monthly-paid employees shall be from 1:00 p. to 5:00 p. the parties agreed to a 7hour work schedule from 9:00 a. respondent issued an inter-office memorandum declaring that. to 12:00 noon and from1:00 p. maintained the 9:00 a.m. Where the employee is permitted or suffered to work on legally mandated holidays or on his designated rest day which is not a legally mandated holiday. to 5:00 p. schedule for non-race days. The CBA governed the economic rights and obligations of respondent’s regular monthly paid rank-and-file employees. however.m. on a work week of Monday to Saturday. The memorandum.Agreement (CBA) effective January 1.m. the employees are precluded from rendering their usual overtime work from 5:00 p. Subsequently.m.m. Petitioner claimed that as a result of the memorandum.m.m. that is. In the CBA. thirty percent (30%) shall be added to his basic wage for a seven hour work. overtime on an ordinary working day shall be remunerated in an amount equivalent to the worker's regular basic wage plus twenty five percent (25%) thereof. On October 12. The CBA likewise reserved in respondent certain management prerogatives. 1996 to December 31.m. petitioner questioned the memorandum as violative of the prohibition against non-diminution of wages and benefits guaranteed under Section 1. layoff of workers and discipline. We have thus held that management is free to regulate. working methods. including hiring. work assignments. work supervision. petitioner then appealed the panel’s decision to the CA . working regulations. as employer.m. processes to be followed. Evidently. and the general principles of justice and fair play. When the races were moved to 2:00 p. the horse races started at 10:00 a. petitioner’s present recourse. We are not unmindful that every business enterprise endeavors to increase profits. the adjustment in the work schedule of the employees is justified. Petitioner moved for reconsideration but the panel denied the motion. CBAs.The NCMB’s panel of voluntary arbitrators upheld respondent's prerogative to change the work schedule of regular monthly-paid employees. according to its own discretion and judgment. the Court will not interfere with the business judgment of an employer in the exercise of its prerogative to devise means to improve its operation. all aspects of employment. The CA upheld that of the panel and denied petitioner’s subsequent motion for reconsideration. cites the change in the program of horse races as reason for the adjustment of the employees’ work schedule. It rationalizes that when the CBA was signed. place and manner of work. Issues: Whether or not the act of the company is changing the work schedule of the employees is part of management prerogative.. As it is.m. and recall of workers. time. Dissatisfied. Hence. Respondent. there was no other choice for management but to change the employees' work schedule as there was no work to be done in the morning. supervision of workers. . Held: YES. dismissal. transfer of employees. provided that it does not violate the law. 2004. .DUNCAN ASSOCIATION OF DETAILMAN-PTGWO and PEDRO A. TECSON. vs. No. Inc.. 162994.R. Respondent.: Facts: Petitioner Pedro A. SECOND DIVISION TINGA. September 17. as medical representative after Tecson had undergone training and orientation. petitioners. J. INC. Tecson was hired by respondent Glaxo Wellcome Philippines. G. GLAXO WELLCOME PHILIPPINES. Tecson requested for time to comply with the company policy against entering into a relationship with an employee of a competitor company. Tecson was initially assigned to market Glaxo’s products in the Camarines Sur-Camarines Norte sales area. Still. that he agrees to study and abide by existing company rules. He explained that Astra. Bettsy’s employer. another drug company. Tecson’s superiors reminded him that he and Bettsy should decide which one of them would resign from their jobs. Tecson signed a contract of employment which stipulates.Thereafter. was planning to merge with Zeneca. an employee of Astra Pharmaceuticals (Astra). The Employee Code of Conduct of Glaxo similarly provides that an employee is expected to inform management of any existing or future relationship by consanguinity or affinity with co-employees or employees of competing drug companies. . the management and the employee will explore the possibility of a "transfer to another department in a non-counterchecking position" or preparation for employment outside the company after six months. among others. love prevailed. although they told him that they wanted to retain him as much as possible because he was performing his job well. If management perceives a conflict of interest or a potential conflict between such relationship and the employee’s employment with the company. Tecson entered into a romantic relationship with Bettsy. Bettsy was Astra’s Branch Coordinator in Albay. Subsequently. and Bettsy was planning to avail of the redundancy package to be offered by Astra. a competitor of Glaxo. With Bettsy’s separation from her company. and Tecson married Bettsy in September 1998. She supervised the district managers and medical representatives of her company and prepared marketing strategies for Astra in that area. to disclose to management any existing or future relationship by consanguinity or affinity with co-employees or employees of competing drug companies and should management find that such relationship poses a possible conflict of interest. Even before they got married. Tecson received several reminders from his District Manager regarding the conflict of interest which his relationship with Bettsy might engender. In January 1999. to resign from the company. Tecson’s superiors informed him that his marriage to Bettsy gave rise to a conflict of interest. the potential conflict of interest would be eliminated. Aggrieved. Glaxo. Tecson sought Glaxo’s reconsideration regarding his transfer and brought the matter to Glaxo’s Grievance Committee. Tecson again requested for more time resolve the problem. During the pendency of the grievance proceedings. but his request was denied. The Court of Appeals denied the Petition for Review on the ground that the NCMB did not err in rendering its Decision. Tecson applied for a transfer in Glaxo’s milk division. 2000. He was also not included in product conferences regarding such products. they would be able to avail of the attractive redundancy package from Astra. however. His application was denied in view of Glaxo’s "least-movement-possible" policy. Tecson filed a Petition for Review with the Court of Appeals assailing the NCMB Decision. Tecson was paid his salary. they submitted the matter for voluntary arbitration. In November 1999. Tecson defied the transfer order and continued acting as medical representative in the Camarines Sur-Camarines Norte sales area. remained firm in its decision and gave Tescon until February 7. and affirming Glaxo’s right to transfer Tecson to another sales territory. but was not issued samples of products which were competing with similar products manufactured by Astra. Tecson asked Glaxo to reconsider its decision. Glaxo offered Tecson a separation pay of one-half (½) month pay for every year of service. 2000 to comply with the transfer order. thinking that since Astra did not have a milk division. At the same time.00 but he declined the offer. Because the parties failed to resolve the issue at the grievance machinery level. In August 1999. In September 1999. The appellate court held that Glaxo’s policy prohibiting its employees from having personal relationships .the potential conflict of interest would be eliminated.000. On November 15. the National Conciliation and Mediation Board (NCMB) rendered its Decision declaring as valid Glaxo’s policy on relationships between its employees and persons employed with competitor companies. or a total of P50. Glaxo transferred Tecson to the Butuan City-Surigao CityAgusan del Sur sales area. The prohibition against personal or marital relationships with employees of competitor companies upon Glaxo’s employees is reasonable under the circumstances because relationships of that nature might compromise the interests of the company. Tecson filed a Motion for Reconsideration of the appellate court’s Decision.with employees of competitor companies is a valid exercise of its management prerogatives. it does not mean that every labor dispute will be decided in favor of the workers. Glaxo only aims to protect its interests against the possibility that a competitor company will gain access to its secrets and procedures. Hence this petition. The law also recognizes that management has rights which are also entitled to respect and enforcement in the interest of fair play. marketing strategies and other confidential programs and information from competitors. That Glaxo possesses the right to protect its economic interests cannot be denied. manufacturing formulas. In laying down the assailed company policy. No reversible error can be ascribed to the Court of Appeals when it ruled that Glaxo’s policy prohibiting an employee from having a relationship with an employee of a competitor company is a valid exercise of management prerogative. while our laws endeavor to give life to the constitutional policy on social justice and the protection of labor. . No less than the Constitution recognizes the right of enterprises to adopt and enforce such a policy to protect its right to reasonable returns on investments and to expansion and growth. Issue: Whether the Glaxo’s policy against its employees marrying employees from competitor companies is valid. but the motion was denied by the appellate court. Held: YES. Glaxo has a right to guard its trade secrets.20 Indeed. especially so that it and Astra are rival companies in the highly competitive pharmaceutical industry. " for a fixed period from November 21. petitioner. vs.PHILIPPINE TELEGRAPH AND TELEPHONE COMPANY. J.F.R. her employment was to be immediately terminated upon expiration of the . 1991 vice one C. 1990 until April 20. specifically as a "Supernumerary Project Worker. respondents. SECOND DIVISION REGALADO. G. May 23. Under the Reliever Agreement which she signed with petitioner company. No. 1997. Facts: Grace de Guzman was initially hired by petitioner as a reliever. 118978. NATIONAL LABOR RELATIONS COMMISSION and GRACE DE GUZMAN. Tenorio who went on maternity leave. 1991. On September 2. and pursuant to their Reliever Agreement. 1991. plus payment of the corresponding back wages and COLA. its branch supervisor in Baguio City. private respondent's services as reliever were again engaged by petitioner. and that all along she had not deliberately hidden her true civil status. was correspondingly ordered. Her reinstatement. 1991. and from July 19. sent to private respondent a memorandum requiring her to explain the discrepancy. on May 26. she was reminded about the company's policy of not accepting married women for employment. Petitioner nonetheless remained unconvinced by her explanations. 1991 and July 8. she indicated in the portion for civil status therein that she was single although she had contracted marriage a few months earlier. On appeal to the National Labor Relations Commission (NLRC). In that memorandum. Oficial. Private respondent was dismissed from the company which she readily contested by initiating a complaint for illegal dismissal. Issue: . Dizon who went on leave during both periods. The Labor Arbiter declared that private respondent. Delia M. When petitioner supposedly learned about the same later.agreed period. coupled with a claim for non-payment of cost of living allowances (COLA). 1991. 1991. 1991. private respondent stated that she was not aware of PT&T's policy regarding married women at the time. Thereafter. from June 10. the probationary period to cover 150 days. 1991 to July 1. said public respondent upheld the labor arbiter and it ruled that private respondent had indeed been the subject of an unjust and unlawful discrimination by her employer. this time in replacement of one Erlinda F. her services were terminated. After August 8. was illegally dismissed by petitioner. private respondent was once more asked to join petitioner company as a probationary employee. that is. It now appears that private respondent had made the same representation in the two successive reliever agreements which she signed on June 10. In the job application form that was furnished her to be filled up for the purpose. who had already gained the status of a regular employee. PT & T. before the Regional Arbitration Branch of the National Labor Relations Commission in Baguio City. In her reply letter. 1991 to August 8. RONALDO D. As put in a case. petitioner's policy of not accepting or considering as disqualified from work any woman worker who contracts marriage runs afoul of the test of. lay-off of workers. Held: YES. so it is claimed. according to his discretion and best business judgment.Whether the act of the petitioner constituted a marital discrimination. Josephine Ongsitco is its Manager of the . and not merely because of her supposed acts of dishonesty. not because the latter got married but because she concealed that fact. ESTRELLA. and the right against. petitioner's expostulations that it dismissed private respondent." except in cases of unlawful discrimination or those which may be provided by law. COMIA & LORNA E. afforded all women workers by our labor laws and by no less than the Constitution. and recall of employees. Her concealment. In the present controversy. JOSEPHINE ONGSITCO & SEBASTIAN CHUA. does have a hollow ring. discrimination. Petitioners. It is recognized that regulation of manpower by the company falls within the so-called management prerogatives. 2006. the record discloses clearly that her ties with the company were dissolved principally because of the company's policy that married women are not qualified for employment in PT & T. In the case at bar. dismissal.: Facts: Petitioner Star Paper Corporation is a corporation engaged in trading – principally of paper products. No. an employer is free to regulate. 164774 . work assignments. as well as regulations on the transfer of employees. which prescriptions encompass the matter of hiring. working methods and assignments. SECOND DIVISION PUNO.R. WILFREDA N. -versus. supervision of workers. Contrary to petitioner's assertion that it dismissed private respondent from employment on account of her dishonesty. G. bespeaks dishonesty hence the consequent loss of confidence in her which justified her dismissal. SIMBOL. Respondents. all aspects of employment. STAR PAPER CORPORATION. J. April 12. and the discipline. "from hiring to firing. also an employee of the company. 1998 pursuant to the company policy. She met Luisito Zuñiga . she alleges that she had a relationship with co-worker Zuñiga who misrepresented himself as a married but separated man. They stated therein that they have no money and property accountabilities in the company and that they release the latter of any claim or demand of whatever nature. they were compelled to resign in view of an illegal company policy. Estrella was hired on July 29. Comia was hired by the company on February 5. 1999 but she found out that her name was on-hold at the gate. Ongsitco likewise reminded them that pursuant to company policy. a married man. 1998. On November 30. 1997. one of them should resign pursuant to a company policy. Comia and Lorna E. 1999. she discovered that he was not separated. She returned to work on December 21. Respondents Ronaldo D. Estrella were all regular employees of the company. whom he married on June 27. She was directed to proceed to the personnel office where one . also a co-worker.Personnel and Administration Department while Sebastian Chua is its Managing Director. Comia resigned on June 30. 1994. Simbol resigned on June 20. The respondents each signed a Release and Confirmation Agreement. 1999. Respondents offer a different version of their dismissal. Thus. The company allegedly could have terminated her services due to immorality but she opted to resign on December 21. Prior to the marriage. He met Alma Dayrit. She was denied entry. a co-employee. Wilfreda N. After he got her pregnant. 2000. Ongsitco advised the couple that should they decide to get married. Simbol was employed by the company on October 27. As to respondent Estrella. 2000. 1993. Simbol and Comia allege that they did not resign voluntarily. she severed her relationship with him to avoid dismissal due to the company policy. Petitioners stated that Zuñiga. Simbol . she met an accident and was advised by the doctor at the Orthopedic Hospital to recuperate for twenty-one (21) days. She met Howard Comia. got Estrella pregnant. one must resign should they decide to get married. whom she married on June 1. or to stipulate expressly or tacitly that upon getting married a woman employee shall be deemed resigned or separated. The case at bar involves Article 136 of the Labor Code which provides: Art. Due to her urgent need for money. The memorandum stated that she was being dismissed for immoral conduct. separation pay and attorney’s fees.of the staff handed her a memorandum. after submission of the explanation. Respondents filed a Motion for Reconsideration but was denied by the NLRC. she later submitted a letter of resignation in exchange for her thirteenth month pay. Respondents later filed a complaint for unfair labor practice. the petitioners’ dismissal from employment and ordering private respondents to reinstate petitioners to their former positions without loss of seniority rights with full backwages from the time of their dismissal until actual reinstatement. The Labor Arbiter dismissed the complaint for lack of merit. constructive dismissal. discharge. she was nonetheless dismissed by the company. The Labor Code is the most comprehensive piece of legislation protecting labor. the Commission affirmed the decision of the Labor Arbiter. 136. or to actually dismiss. It shall be unlawful for an employer to require as a condition of employment or continuation of employment that a woman employee shall not get married. . She refused to sign the memorandum because she was on leave for twenty-one (21) days and has not been given a chance to explain. They averred that the aforementioned company policy is illegal and contravenes Article 136 of the Labor Code. However. discriminate or otherwise prejudice a woman employee merely by reason of her marriage. On appeal to the NLRC. Issue: Whether the policy of the employer banning spouses from working in the same company is a valid exercise of management prerogative. Held: NO. They appealed to the Court of Appeals which reversed the NLRC decision declaring illegal. The management asked her to write an explanation. then an employee of the Repacking Section. but not on the ground of a general principle. We do not find a reasonable business necessity in the case at bar. The policy is premised on the mere fear that employees married to each other will be less efficient. Companies adopt these policies to prevent the hiring of unqualified persons based on their status as a relative. We note that two types of employment policies involve spouses: policies banning only spouses from working in the same company (no-spouse employment policies). then a Production Helper in the Selecting Department. including spouses. A requirement of that nature would be valid provided it reflects an inherent quality reasonably necessary for satisfactory job performance. and those banning all immediate family members. the employer can create policies based on an unproven presumption of a perceived danger at the expense of an employee’s right to security of tenure. where the particular requirements of the job would justify the same.” or BFOQ. Petitioners failed to show how the marriage of Simbol. to Alma Dayrit. Neither did petitioners explain how this detriment will happen in the case of Wilfreda Comia. These policies focus upon the potential employment problems arising from the perception of favoritism exhibited towards relatives. If we uphold the questioned rule without valid justification. then a helper in the cutter-machine. could be detrimental to its business operations. It is significant to note that in the case at bar. then a Sheeting Machine Operator. With more women entering the workforce.It is true that the policy of petitioners prohibiting close relatives from working in the same company takes the nature of an anti-nepotism employment policy. but were asked to resign when they married a coemployee. . A requirement that a woman employee must remain unmarried could be justified as a “bona fide occupational qualification. rather than upon their ability. employers are also enacting employment policies specifically prohibiting spouses from working for the same company. from working in the same company (antinepotism employment policies). respondents were hired after they were found fit for the job. such as the desirability of spreading work in the workplace. who married Howard Comia. L-10712. Thus. defendant-appellant. EN BANC TRENT. CARLOS GSELL. 1916. The protection given to labor in our jurisdiction is vast and extensive that we cannot prudently draw inferences from the legislature’s silence that married persons are not protected under our Constitution and declare valid a policy based on a prejudice or stereotype. the absence of a statute expressly prohibiting marital discrimination in our jurisdiction cannot benefit the petitioners. vs.R. G.Lastly. J.: Facts: . for failure of petitioners to present undisputed proof of a reasonable business necessity. ANSELMO FERRAZZINI. we rule that the questioned policy is an invalid exercise of management prerogative. No. plaintiff-appellee. August 10. The plaintiff had been employed by the defendant for an indefinite time to work in the latter's industrial enterprises involving the manufacture of umbrellas in the city of Manila. whatever. This work was entirely different and disassociated from that engaged in by the defendant Gsell. and for the period of five years after the termination of the employment of the said party of the second part. but alleged that the discharge was lawful on account of absence. The defendant admitted that he discharged the plaintiff without giving him the "written advice of six months in advance" as provided in the contract. The plaintiff admits that he entered the employment of Mr. Philippine currency (P10. unfaithfulness. and shall not assist. save and except after obtaining special written permission therefor from the said party of the first part. advice or suggestions of any kind. It is further stipulated and agreed that the said party of the second part is hereby obligated and bound to pay unto the party of the first part the sum of ten thousand pesos. three or more years.000) as liquidated damages for each and every breach of the present clause of this contract. Whalen in the Philippine Islands as a foreman on some construction work for a cement factory within a few days after his discharge and without the consent. and disobedience of orders. yet this act of the plaintiff was a technical violation of the above-quoted provisions of the contract wherein he expressly agreed and obligated himself "not to enter into the employment of any enterprise in the Philippine Islands. and without regard to the cause of the termination of said employment. . whether such breach occurred during the employment of the said party of the second part or at any time during the period of five years from and after the termination of said employment. That portion of the contract upon which the defendant's counterclaimed is based reads as follows: That during the term of this contract. either written or verbal. whether this contract continue in force for the period of one. or be sooner terminated. two. aid or encourage any such enterprise by the furnishing of information. of the defendant. whatever. the said party of the second party shall not engage or interest himself in any business enterprises similar to or in competition with those conducted. maintained or operated by the said party of the first day in the Philippines. The defendant sought affirmative relief for a further alleged breach of the contract by the plaintiff after his discharge. and shall not enter into the employ of any enterprises in the Philippine Islands. L-21127. It is not necessary for the protection of the defendant. It is limited as to time and space but not as to trade. It would force the plaintiff to leave the Philippine Islands in order to obtain a livelihood in case the defendant declined to give him the written permission to work elsewhere in this country. G.R. SHANNON RICHMOND.: . ALFONSO DEL CASTILLO. February 9.save and except after obtaining special written permission therefor" from the defendant. plaintiff-appellant. No. J. tested by the law. Held: No. vs. rules and principlest forth is clearly one in undue or unreasonable restraint of trade and therefore against public policy. Issue: Whether the provisions of the contract are valid and binding upon the plaintiff. EN BANC JOHNSON. as this is provided for in another part of the clause. The contract under consideration. defendant-appellee. 1924. nor own nor have any interest directly or indirectly in any other drugstore either in his own name or in the name of another. as plaintiff has announced his intention to do. and asked that the same be declared null and void and of no effect. are contrary to public policy. Province of Albay. The plaintiff alleges that the provisions and conditions contained in the third paragraph of said contract constitute an illegal and unreasonable restriction upon his liberty to contract. The defendant interposed a general and special defense. the following stipulation appeared: 3. and Daraga of the municipality of Albay. In his special defense he alleges "that during the time the plaintiff was in the defendant's employ he obtained knowledge of his trade and professional secrets and came to know and became acquainted and established friendly relations with his customers so that to now annul the contract and permit plaintiff to establish a competing drugstore in the town of Legaspi. while the said Shannon Richmond or his heirs may own or have open a drugstore. The said contract was acknowledge before a notary on the same day of its execution. Albay. Held: . would be extremely prejudicial to defendant's interest. the said Alfonso del Castillo also agrees not to open. and are unnecessary in order to constitute a just and reasonable protection to the defendant. nor have any connection with or be employed by any other drugstore situated within a radius of our miles from the district of Legaspi. In their agreement. municipality and Province of Albay.Facts: Shannon Richmond hired Alfonso del Castillo as pharmacist of the former’s drugstore known as the Botica Americana situated in the district of Legaspi of the municipality and Province of Albay." Issue: Whether or not the qestioned stipulation is valid. or have an interest in any other one within the limits of the districts of Legaspi. That in consideration of the fact that the said Alfonso del Castillo has just graduated as a pharmacist and up to the present time has not been employed in the capacity of a pharmacist and in consideration of this employment and the monthly salary mentioned in this contract. April 19. in relation with the limitation placed upon the plaintiff both as to time and place. we are of the opinion. 2006. Petitioner. SOLIDBANK CORPORATION. is not void as being in restraint of trade if the restraint imposed is not greater than that which is necessary to afford a reasonable protection. No. FIRST DIVISION . Respondent. A contract by which an employee agrees to refrain for a given lenght of time. Considering the nature of the business in which the defendant is engaged. Of course in establishing whether the contract is a reasonable or unreasonable one. after the expiration of the term of his employment. the nature of the business must also be considered.YES. the contract is.R. under the particular circumstances of the case and the nature of the particular contract involved in it. What would be a reasonable restriction as to time and place upon the manufacture of railway locomotive engines might be a very unreasonable restriction when imposed upon the employment of a day laborer. In all cases like the present. vs. competitive with that of his employer. 163269 . RIVERA. from engaging in a business. unreasonable. the question is whether. ROLANDO C. and so decide. that such limitation is legal and reasonable and not contrary to public policy. or is not. G. which contains the following provisions: I will not. Waiver and Quitclaim. at any time. I hereby expressly undertake that I will not seek employment with any competitor bank or financial institution within one (1) year from February 28.CALLEJO. 1995. agents or employees. he became the Manager of the Credit Investigation and Appraisal Division of the Consumer’s Banking Group.619. Senior Clerk. He was initially employed as an Audit Clerk. Prior to his retirement. In December 1994. Assistant Accountant. then as Credit Investigator.045. its plans. Solidbank offered two retirement programs to its employees. Deciding to devote his time and attention to his poultry business in Cavite. their stockholders. Rivera applied for retirement under the SRP. 1977. I executed in favor of Solidbank on FEBRUARY 28. he was entitled to receive P1. Upon discovering this.95 by way of benefits. Solidbank wrote a letter informing Rivera that he had violated the Undertaking. SR. in any manner whatsoever. The second undertaking is incorporated in the Undertaking following petitioner’s execution of the Release. Waiver and Quitclaim which reads: That as a supplement to the Release and Quitclaim.: Facts: Petitioner had been working for Solidbank Corporation since July 1. officers. its parent. She likewise demanded the . Under the SRP. directors.28.. processes or data of any kind. he was not qualified for retirement under the ORP. 1995. the Equitable Banking Corporation employed Rivera as Manager of its Credit Investigation and Appraisal Division of its Consumers’ Banking Group. Subsequently. Since Rivera was only 45 years old.258. directly or indirectly engage in any unlawful activity prejudicial to the interest of the BANK. 1995. Solidbank required Rivera to sign an undated Release. affiliate or subsidiary companies. 1995. and their successors-in-interest and will not disclose any information concerning the business of the BANK. its manner or operation. J. Rivera received the amount and confirmed his separation from Solidbank on February 25. Solidbank approved the application and Rivera was entitled to receive the net amount of P963. and Assistant Manager. On May 1. When Rivera refused to return the amount demanded within the given period. Although the period of one year may appear reasonable.return of all the monetary benefits he received in consideration of the SRP within five (5) days from receipt. appropriate legal action would be taken against him. the matter of whether the restriction is reasonable or unreasonable cannot be ascertained with finality solely from the terms and conditions of the Undertaking. oppressive. hence. . otherwise. On the face of the Undertaking. or even in tandem with the Release. Waiver and Quitclaim. the post-retirement competitive employment ban is unreasonable because it has no geographical limits. Held: Yes. respondent is barred from accepting any kind of employment in any competitive bank within the proscribed period. Issue: Whether the employment ban incorporated in the Undertaking which petitioner executed upon his retirement is unreasonable. contrary to public policy. Solidbank filed a complaint for Sum of Money with Prayer for Writ of Preliminary Attachment before the Regional Trial Court. Petitioner. Respondents. petitioner filed with the NLRC a complaint for illegal suspension. J.versus . as well as the students’ learning.A. G. The employer may place the . and that the suspension will allow petitioner to “prepare himself for the investigation and will prevent his influences to other members of the community. Petitioner questioned the validity of the administrative proceedings with the Regional Trial Court in a petition for certiorari but the case was terminated on May 21. FIRST DIVISION AUSTRIA-MARTINEZ. NO.” Thus. disregard the previous administrative proceedings and conduct anew an investigation on the charges againstpetitioner.: Facts: Petitioner Renato S. 7877 (R. 2006. as well as the authority of respondent to investigate. 1999 when the parties entered into a compromise agreement wherein respondent MIT agreed to publish in the school organ the rules and regulations implementing Republic Act No.R. Some time in November 1998. 7877) or the AntiSexualHarassment Act. 1999.NATIONAL LABOR RELATIONS COMMISSION. sexual harassment and conduct unbecoming of an academician. MAPUA INSTITUTE OF TECHNOLOGY and JOSE CALDERON. Petitioner agreed to recognize the validity of the published rules and regulations. Issue: Whether or not the preventive suspension is valid. a civil engineering student of respondent MIT filed a letter-complaint against petitioner for unfair/unjust grading system. The committee believed that petitioner’s continued stay during the investigation affects his performance as a faculty member. January 23. Pending investigation of the complaint. 146779. Faculty of Civil Engineering. .RENATO S. Gatbonton is an associate professor of respondent Mapua Institute of Technology (MIT). Held: NO. Preventive suspension is a disciplinary measure for the protection of the company’s property pending investigation of any alleged malfeasance or misfeasance committed by the employee. GATBONTON. No. hear and decide the administrative case against him. respondent MIT placed petitioner under a 30day preventive suspension effective January 11. 150660.: . when it is determined that there is no sufficient basis to justify an employee’s preventive suspension. However.R. J. the latter is entitled to the payment of salaries during the time of preventive suspension.worker concerned under preventive suspension if his continued employment poses a serious and imminent threat to the life or property of the employer or of his co-workers. No. July 30. respondents. [G. ALFREDO ROCO and CANDELARIA ROCO. 2002] FIRST DIVISION KAPUNAN. hence. However. there is no dispute that she was employed on probationary basis. Issue: What is the proper computation of the probationary employment period. 1995 and her services were terminated on November 15. Held: . it hired Candelaria Roco as helper. 1995. She was hired on May 16. The Labor Arbiter sustained CALS in terminating her employment. The NLRC affirmed the Labor Arbiter’s ruling. the Court of Appeals set aside the NLRC ruling on the ground that at the time Candelaria’s services were terminated. The Court of Appeals did not disagree with the NLRC’s finding that Candelaria was dismissed because she did not qualify as a regular employee in accordance with the reasonable standards made known by the company to her at the time of her employment. she had attained the status of a regular employee as the termination on November 15. On May 16. She did not measure up to the work standards on the dressing of chicken.Facts: CALS Poultry Supply Corporation is engaged in the business of selling dressed chicken and other related products and managed by Danilo Yap. With respect to Candelaria Roco. 1995 was effected four (4) days after the 6-month probationary period had expired. at its chicken dressing plant on a probationary basis. 1995 due to poor work performance. she is entitled to security of tenure in accordance with Article 281 of the Labor Code. Deputy Minister of Labor. 149859. vs. our computation of the 6-month probationary period is reckoned from the date of appointment up to the same calendar date of the 6th month. No. [G. June 9. NATIONAL LABOR RELATIONS COMMISSION. MIDDLEBY PHILIPPINES CORPORATION/FRANK .R. 2004] RADIN C.In Cebu Royal v. petitioner. ALCIRA. THOMAS, XAVIER G. PEÑA and TRIFONA F. MAMARADLO, respondents. CORONA, J.: Facts: The petitioner, Radin Alcira, was hired by the respondent Middleby Philippines Corporation as engineering support services supervisor under probationary status for 6 months. Afterwards, the service of the petitioner was terminated by the respondent on the ground that the latter was not satisfied on the performance of the former. As a result, the petitioner filed a complaint foe illegal dismissal in the National Labor Relations Commission (NLRC) against the respondent. Petitioner contended that his termination in the service tantamount to illegal dismissal since he attained the status of a regular employee as of the time of dismissal. He presented the appointment paper showing that he was hired on May 20, 1996, consequently, his dismissal on November 20, 1996 was illegal because at that time, he was already a regular employee since the 6-month probationary period ended on November 16, 1996. The respondent, on the other hand, asserted that during the petitioner’s probationary period, he showed poor performance on his assigned tasks, was late couple of times and violated the company’s rule. Thus, the petitioner was terminated and his application to become a regular employment was disapproved. The respondent also insisted that the removal of the petitioner from office was within the probationary period. The Labor Arbiter dismissed the complaint on the ground that the dismissal of the petitioner was done before his regularization because the 6- month probationary period, counting from May 20, 1996 shall end on November 20, 1996. The NLRC affirmed the decision of the Labor Arbiter. The Court of Appeals affirmed the decision of NLRC. Hence, the present recourse. Issue: Whether the petitioner was already a regular employee in respondent’s company at the time of his dismissal from the service Held: The Supreme Court ruled in the negative. The status of the petitioner at the time of his termination was still probationary. His dismissal on November 20, 1996 was within the 6- month probationary period. Article 13 of the Civil Code provides that when the law speaks of years, months, and days and nights, it shall be understood that years are of 365 days, months of 30 days, days of 24 hours and nights are from sunset to sunrise. Since, one month is composed of 30 days, then, 6 months shall be understood to be composed of 180 days. And the computation of the 6- month period is reckoned from the date of appointment up to the same calendar date of the 6th month following. Since, the number of days of a particular month is irrelevant, petitioner was still a probationary employee at the time of his dismissal. Wherefore, the petition is dismissed. G.R. No. 148738 MITSUBISHI MOTORS PHILIPPINES CORPORATION, Petitioner, - versus CHRYSLER PHILIPPINES LABOR UNION and NELSON PARAS, Respondents. PUNO, J., FACTS Private respondent Nelson Paras first worked with Mitsubishi Philippines as a shuttle bus driver on March 19, 1976. He resigned on June 16, 1982 because he went to Saudi Arabia and worked there as a diesel mechanic and heavy machine operator from 1982 to 1993. Upon his return, Mitsubishi Philippines re-hired him as a welder-fabricator at a tooling shop from November 1, 1994 to March 3, 1995. On May 1996, Paras was re-hired again, this time as a probationary manufacturing trainee at the Plant Engineering Maintenance Department. He had an orientation on May 15, 1996 and afterwhich, with respect to the company’s rules and guidelines, started reporting for work on May 27, 1996. Paras was evaluated by his immediate supervisors after six months of working. The supervisors rating Paras’ performance were Lito R. Lacambacal and Wilfredo J. Lopez, as part of the MMPC’s company policies. Upon this evaluation, Paras garnered an average rating. Later, respondent Paras was informed by his supervisor, Lacambacal, that he received an average performance rating but it is a rate which would still qualify him to be regularized. But as part of the company protocols, the Division Managers namely A.C. Velando, H.T. Victoria and Dante Ong reviewed the performance evaluation made on Paras. Despite the recommendations of the supervisors, they unanimously agreed that the performance was unsatisfactory. As a consequence, Paras was not considered for regularization. Paras received a Notice of Termination on November 26, 1996 which was dated November 25, 1996. This letter’s intent is to formally relieve him off of his services and position effective the date since he failed to meet the company’s standards. ISSUE: Whether or not respondent Paras’ termination was legal or not. HELD: The Court holds that a company employer may indeed hire an employee on a probationary basis in order to determine his fitness to perform work. The Court stresses the existence of the statements under Article 281 of the Labor Code which specifies that the employer must inform the employee of the standards they were to meet in order to be granted regularization and that such probationary period shall not exceed six (6) months from the date the employee started working, unless specified in the apprenticeship agreement. Respondent Paras was employed on a probationary basis and was apprised of the standards upon which his regularization would be based during the orientation. His first day to report for work was on May 27, 1996. As per the company's policy, the probationary period was from three (3) months to a maximum of six (6) months. Applying Article 13 of the Civil Code, the probationary period of six (6) months consists of one hundred eighty (180) days. The Court conforms with paragraph one, Article 13 of the Civil Code providing that the months which are not designated by their names shall be understood as consisting of thirty (30) days each. This case, the Labor Code pertains to 180 days. Also, as clearly provided for in the last paragraph of Article 13, it is said that in computing a period, the first day shall be excluded and the last day included. Thus, the one hundred eighty (180) days commenced on May 27, 1996, and ended on November 23, 1996. The termination letter dated November 25, 1996 was served on respondent Paras only at 3:00 a.m. of November 26, 1996. The Court held that by that time, he was actually already a regular employee of the petitioner under Article 281 of the Labor Code. His position as a regularized employee is thus secured until further notice. [G.R. No. 149371. April 13, 2005] ABERDEEN COURT, INC., and RICHARD NG, petitioners, vs. MATEO C. AGUSTIN JR., respondent. AZCUNA, J.: 1997 the personnel of Centigrade Industries. employed Mateo C. ventilating and air conditioning (HVAC) which are within the realm of field of work of mechanical engineers. Agustin was engaged on a six-month probationary basis. Agustin asserts that Engr. . After the Centigrade personnel finished their job. Aberdeen Court. There were no other specific instructions from Engr. Abad merely requested him to accompany the aforesaid personnel to show the location of the exhaust air outlet at the fifth and sixth floors of the premises. (Aberdeen). Abad. 1996. Abad to petitioner with respect to the conduct or actual reading to be made by the Centigrade personnel. even before the termination of the agreed six-month period. Abad is not a part of his job since he is not a mechanical engineer and there were three (3) other mechanical engineers on duty in the company premises. for the purpose of trouble shooting the electrical problems in said petitioner’s establishment. On the other hand. I understand and agree that the management can terminate my services at any time. petitioner [herein respondent]. being a subordinate of Engr. performed a reading of the exhaust air balancing at the fifth and sixth floors of Aberdeen’s premises. Being an electrical engineer. obliged and accompanied the aforementioned personnel to the location. they submitted their report to Agustin.FACTS: On September 16. On January 12 and 13. petitioner obviously has no knowledge of the procedure and the equipment used by mechanical engineers in the conduct of the reading of the exhaust air balancing. It must be noted that the reading of exhaust air balancing is under the category of heating. that: Should my performance be considered unsatisfactory at any time by management during my probationary period. Petitioners allege that Agustin accepted and signed the report. Petitioners claim that Agustin was placed in charge of the undertaking. Inc. He avers that: The request of Engr. Despite the fact that the request of Engr. Inc. one of the petitioners. Abad is actually the responsibility of the company’s mechanical engineers. herein respondent. Agustin (Agustin). inter alia. The employment contract provided. petitioner did not sign the offered documents. Allegedly. He was then hurriedly led to the door by Ms. 1997. petitioner reported for work on the same day. on the condition that he will sign some documents which provides that the company has no more liability and that he is voluntarily resigning from Aberdeen Court. instead of signing it himself. more or less. Ms. which made it impossible for Aberdeen to transmit any further notice to him. petitioner requested assistance from the Department of Labor and Employment (DOLE). As instructed. Carlos then informed him that he could get his two (2) weeks salary in the amount of P4. Engineer Abad later checked the work of the Centigrade employees only to find out that four rooms in the fifth floor and five rooms in the sixth floor were incorrectly done. According to petitioners. However. In the afternoon of that day. At about seven p. Upon arriving at the company premises. Abad.000. Petitioner was flabbergasted. but he now points out that his signature was not accompanied by any qualification that he accepted the report on behalf of Aberdeen. Agustin allegedly ignored management and left the company. at the personnel office. 1997. Lani Carlos of the Personnel Department. The following day or on January 16. Abad directed respondent to sign it. petitioner asked Ms. Agustin states that after the report was handed to him. petitioner [herein respondent] was summarily dismissed. informed him that Aberdeen Court is terminating his services as electrical engineer. 1997 or two days after the report was submitted by Centigrade Industries. In contrast. . he took the same to Engr.m. Engr. he received a telephone call from the personnel office of respondent company ordering him to report to that office after his tour of duty. The parties also differ on the occurrences two days after the signing of the report or on January 15. who he claims was responsible for evaluating and confirming the said report. He claims that he signed merely to evidence that he received a copy of the report. giving the reason that Agustin was present when the reading was conducted. A DOLE personnel told him to report for work since private respondents did not serve him a notice of termination. Ms. Aware of his rights. Respondent Agustin complied. Aberdeen management confronted Agustin with his failure to check the job and asked him to explain his side. Agustin claims that: On January 15.without verifying its correctness. Carlos. Section 6. In Servidad v.. Rule I. Petitioners say that Agustin was terminated because he failed to qualify as a regular employee. in Secon Philippines Ltd. also provides: . of the reasonable standards under which he could qualify as a regular employee. the Court stated: If the nature of the job did actually necessitate at least one year for the employee to acquire the requisite training and experience. Similarly. The Implementing Rules of the Labor Code in Book VI. ISSUE: Whether or not Agustin qualified as a regular employee Ruling: It can be gleaned from Article 281 of the Labor Code that there are two grounds to legally terminate a probationary employee.Carlos if he could still report for work but private respondent’s personnel officer told him that he cannot do so. however. naturally. NLRC. the same could not be a valid probationary employment as it falls short of the requirement of Article 281 of the Labor Code. the dismissal of the employee was declared illegal by the Court because the employer did not prove that the employee was properly apprised of the standards of the job at the time of his engagement and. Petitioners. v. still. NLRC et al. where effectively the probationary period was for one year. the employer could not show that the employee failed to meet such standards. The rudiments of due process demand that an employee should be apprised beforehand of the conditions of his employment and the basis for his advancement. It was not brought to light that the petitioner was duly informed at the start of his employment. It may be done either: a) for a just cause or b) when employee fails to qualify as a regular employee in accordance with reasonable standards made known by the employer to the employee at the start of the employment. allegedly did not show that respondent was apprised of these reasonable standards at the start of the employment. It is in this regard that We concur with the respondents that by his omission. Said the NLRC: It bears stressing that even if technically the reading of air exhaust balancing is not within the realm of expertise of the complainant. This is what the NLRC found to be the fact in this case. problems fixed and otherwise observe for himself the progress and/or condition/quality of the work performed. -. when he fails to qualify as a regular employee in accordance with the reasonable standards prescribed by the employer.There is probationary employment where the employee. in regard to which there is no need to spell out a policy or standard to be met. Where no standards are made known to the employee at that time. however. still it ought not to be missed that prudence and due diligence imposed upon him not to readily accept the report handed to him by the workers of Centigrade Industries. should not be used to exculpate a probationary employee who acts in a manner contrary to basic knowledge and common sense. By saying so. complainant has shown himself to be undeserving of continued employment from probationary employee to regular employee. complainant is inadvertently degrading himself from an electrical engineer to a mere watchdog. he shall be deemed a regular employee. Required of the complainant was that he himself proceed to the work area. 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. (d) In all cases of probationary employment. . inquire from the workers as to any difficulties encountered. The above rule. Probationary employment shall be governed by the following rules: (c) The services of an employee who has been engaged on probationary basis may be terminated only for a just cause. 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. lack of concern and grasp of basic knowledge and common sense.Probationary employment. We find it hard to believe that complainant would just have been made to sign the report to signify his presence. upon his engagement. As it is. 1996. Ernesto Dacay. The position of senior sales manager was then newly created in line with Shemberg’s objective of product positioning in the consumer market. CORONA. Shemberg was engaged in the business of manufacturing. non-payment of salary.. the supervision and control of the sales force of the company. summoned petitioner and informed him of the management’s decision to terminate his services. NATIONAL LABOR RELATIONS COMMISSION (4th Division) SHEMBERG MARKETING CORPORATION and ERNESTO U. Ms. trading.. 1996. Ruel O. His request to be furnished a 30-day written notice was also denied by the management. J. was hired by private respondent Shemberg Marketing Corporation (Shemberg) as senior sales manager with a monthly salary of P40. Respondents answered that petitioner’s dismissal was premised on the following: (1) his poor performance as evidenced by the steady and substantial drop in company sales since his assumption as senior sales manager. petitioner Florencio M. 145417. distributing and importing various consumer products. as evidenced by the joint affidavit of two of his subordinates. No. Salgado and Joel D. JR. Dacay. backwages. including the appointment of district sales representatives and the reshuffling of salesmen to achieve sales targets. However. JR. petitioner. vs. 2003] FLORENCIO M. Ernesto U. petitioner filed a complaint for illegal dismissal.[G. Jr. (3) his unauthorized use .: FACTS: On May 27. Hence. among others. December 11. Petitioner then requested a meeting with Shemberg’s vice president. (2) the dissatisfaction of his subordinates over his management style and dealings with the company’s distributors which resulted in the low morale of Shemberg’s sales force. Jr.. The senior sales manager was also vested with some discretion to decide on matters within the scope of his functions. Its duties included. Petitioner asked Llanto for the reason but the latter merely informed him that it had something to do with the drop in the company’s sales. Jr. Shemberg’s human resource department manager. on September 14. and Lilybeth Llanto. DACAY. 13th month pay and damages against Shemberg. respondents. but was told that the decision of the management was final.500. Lilybeth Y. Llanto. Sol.R. DE LA CRUZ. de la Cruz. ISSUES: Whether or not De la Cruz is a probationary employee RULING: Petitioner was holding a managerial position in which he was tasked to perform key functions in accordance with an exacting work ethic. Article 281 of the Labor Code provides: Probationary employment – Probationary employment shall not exceed six (6) months from the date the employee started working. His act amounted to fraud or deceit which led to the loss of trust and confidence of his employer. this obviously did not cover acts for his own personal benefit. His position required the full trust and confidence of his employer. Petitioner failed to present any persuasive evidence or argument to prove otherwise. We reiterate the well-established rule that findings of fact of the Court of Appeals are conclusive on the parties and are not generally reviewable by this Court when supported by substantial evidence. Petitioner vigorously contends that he was not a probationary employee since Shemberg failed to disclose to him the reasonable standards for qualifying as a regular employee. Petitioner was hired by respondent Shemberg Marketing Corporation on May 27. unless it is covered by an apprenticeship agreement stipulating a longer period. he committed a transgression that betrayed the trust and confidence of his employer ― reimbursing his family’s personal travel expenses out of company funds. In short. An employee who is allowed to work after a probationary period shall be considered a regular employee. made known by the employer to the employee at the time of his engagement. As found by the court a quo. .of company cellular phone for overseas personal calls and (4) the unauthorized reimbursement of the plane tickets of his wife and child. 1996 and was terminated on September 14. The services of an employee who has been engaged on a probationary basis may be terminated for a just cause or when he fails to qualify as a regular employee in accordance with reasonable standards. petitioner was terminated for his failure to meet the required company standards and for loss of trust and confidence. While petitioner could exercise some discretion. 1996. Ltd. COURT OF APPEALS (Former First Division). and attorney's fees. petitioner.A." It was also understood that Marin "had accepted the [recognized] terms of employment. [he] will receive the salary due [him] at the time of the termination of [his] services. he was interviewed by the following: Senior Supervisor Nenita Montallana. No. including holidays and rest days. and Country Manager (Philippines) Peter W. the evidence on record clearly showing that petitioner was well informed of the standards to be met before he could qualify as a regular employee. with a promise of a salary review upon satisfactory completion of the probationary period. Staff and Administrative Supervisor M. 148931 September 12." and that he would be "reconfirmed as a member of [the] regular staff upon completion of the probationary period. Foster confirmed Marin's appointment as Reservations Officer effective April 6.00. 1992.: FACTS: Marin used to work for Saudia Airlines as a ticketing agent. (Cathay).. MARIN and THE HON. He was to receive a monthly salary of P5. Foster. Reservations Manager Elizabeth Leviste. In a letter dated March 30. J. vs. PHILIP LUIS F. When he applied for employment as a Reservation Officer in Cathay Pacific Airways.334. ISSUE: . moral and exemplary damages. however." On October 15. SR. LIMITED. respondents. Marin filed a complaint6 for illegal dismissal against Cathay and Foster before the NLRC. The letter also stated that Cathay reserved the right to "terminate [Marin's] services during the probationary period if [his] performance proves to be unsatisfactory.R. The complaint was later amended to include claims for 13th month pay.This Court notes. Canizares. in which case. G. 1992. 2006 CATHAY PACIFIC AIRWAYS. CALLEJO. 1992 for a probationary period of six months. 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 his employment. v. In such case. . (2) the dissatisfaction on the part of the employer must be real and in good faith. the contract merely expired. Thus.Whether or not Marin is a probationary employee RULING It is settled that a probationary employee enjoys only a temporary employment status. it was held that the constitutional protection on the probationary employee ends upon the expiration of the period provided for in the probationary contract of employment. he is terminable anytime as long as such termination is made before the expiration of the six-month probationary period. or for the employer to extend to such employee a regular or permanent employment. a probationary employee remains secure in his or her employment during the time that the employment contract remains in effect. it cannot be said that he was illegally dismissed. Thereafter. The employment of a probationary employee may only be terminated either (1) for a just cause. the parties are free to renew the contract or not. in Manlimos v. this Court held that the probationary employment of an employee may be terminated when he fails to qualify as regular employee in accordance with reasonable standards made known to him by his employer at the time of employment and after due process. In general terms. Ltd. but the moment the probationary employment period expires. National Labor Relations Commission. the employee can no longer invoke the constitutional protection. If the employee is not given a permanent or regular employment contract on account of his unsatisfactory work performance. The power of the employer to terminate an employee on probation is thus subject to the following conditions: (1) it must be exercised in accordance with the specific requirements of the contract. not a permanent status. The burden of proving just or valid cause for dismissing an employee rests on the employer. not prejudicial so as to violate the contract or the law. In Secon Philippines. and (3) there must be no unlawful discrimination in the dismissal. NLRC. DAISY V.Y.Y. JR.Y. LOURDES ALFONSO Q. CHICO-NAZARIO. Respondents. DONATO M. 2007 PILAR ESPINA. San Biscuits. 164582 March 28. BENJAMIN PAZ. ELEANOR G. MRS. CLAUDIO DE LOS REYES.: FACTS: Respondent M. San Sales Force Union-PTGWO was informed of the closure or cessation of business operations of respondent M. DEOCAREZA. JULIO M. DE BORJA. PATERNO FERNANDEZ. SAN BISCUIT CORP. G. AQUINO.Y. San Worker’s Union-PTGWO and M.. San Corporation (Monde) and was notified of their termination. CELIS. KENG SUN MAR.Y. San) was previously engaged in the business of manufacturing biscuits and other related products.. CORAZON T. EBREO. . MATEO D. BLANCO. in a conciliation proceeding before the Department of Labor and Employment (DOLE) NCMB-NCR Director Leopoldo de Jesus. HON. COURT OF APPEALS. PETALIO. REMEGIO P.We agree with the rulings of the Labor Arbiter and NLRC that respondent's employment was not terminated during the period of his probationary employment. Petitioners. On 27 December 2000. ALLAN PANLILIO. LEONORA PAZ. vs. ARCEO. DIOSCORO FAJANILAG.. LORENE C. SAN BISCUIT INC. CRISTITO S. PUNZALAN. RODRIGUEZ.Y. BASCO. EMILIANO A. ABELA. MA. BANDINO.Y. MARICRIS S. and AGUSTIN WONG. M. J. PASCUAL. No.Y.. San as a result of the intended sale of the business and all the assets of respondent M. and that he was not extended a regular employment by petitioner Cathay on account of his unsatisfactory work performance during the probationary period. effective 31 January 2001. MONDE M. MHEW WHA LIM and MR. BAJO. the duly authorized representative of M. J. ANICETO M. ARNOLD M. San to respondent Monde M. BARNUEVO. (M. LEANDRO R. ALEJANDRO D.Y. Inc. NOEL T.R. Y. if qualified. San shall provide respondent Monde a list of all its present employees who shall be given preference in employment by the latter.Y. an Asset Purchase Agreement was executed between respondents M. SAN CORPORATION and/or the new owner of the COMPANY. all the employees of respondent M. dated 27 December 2000. the covered employees shall be given hiring preference. In the rehiring. San received their separation pay and the cash equivalent of their vacation and sick leaves. Embodied in the MOA is an agreement that the existing Collective Bargaining Agreement shall cease to be effective on 31 January 2001 and shall in no way be binding upon the buyer. respondent Monde. San and Monde. The continued existence of the UNION in the company and/or MONDE M.5 On 22 January 2001.Y. All employees hired by MONDE M. through its National President. and that respondent M. they signed their respective Quitclaims. subject to such criteria as the new corporation may impose. Pertinent provisions of the Agreement: The Company agrees to submit the list of all its present employees to the new corporation for purposes of rehiring if said employee applies and qualifies. San were filed before the DOLE Regional Office No.Y. or his authorized representative.Y. become members of the UNION. the written notice of the sale and purchase of the assets of respondent M. the PTGWO. San and the Union signed a Memorandum of Agreement (MOA) embodying the agreements set forth in the Minutes/Agreement. shall act as the TRUSTEE of the UNION.6 On 31 January 2001.Y. 2001. subject to the terms and conditions of their probationary employment. On 1 February 2001. respondent M. . Thereafter. IV.Y San to respondent Monde and of the termination of all the employees of respondent M.On 28 December 2000. During the entire rehiring process and until the election and qualification of the new officers. SAN CORPORATION shall not be interrupted by the payment of the Company’s employees of their separation package or the temporary closure of the Company’s operations.Y. shall upon hiring. The corresponding Notice as to whom of the covered employees have been hired by the new corporation shall be issued immediately after January 31. San who were terminated upon its closure and who applied and qualified for probationary employment. petitioners were terminated on various dates. However. retrenchment to prevent losses or the closing or cessation of operation of the establishment or undertaking unless the closing is for the purpose of circumventing the provisions of this Title. All the former employees of respondent M. employers are also accorded rights and privileges to assure their self-determination and independence and reasonable return of capital. This mass of privileges comprises the so-called management prerogatives. 283.—The employer may also terminate the employment of any employee due to the installation of labor saving devices. Article 283 of the Labor Code reads: ART. started working for respondent Monde on a contractual basis for a period of six months. respondent Monde commenced its operations. One of the rights accorded an employer is the right to close an establishment or undertaking.On 2 February 2001. including petitioners herein. redundancy. Subsequently. Closure of establishment and reduction of personnel. the State has the right to determine whether an employer’s privilege is exercised in a manner that complies with the legal requirements and does not offend the protected rights of labor. no law can compel anybody to continue the same.Y. by serving a written notice on the worker and the . The right to close the operations of an establishment or undertaking is explicitly recognized under the Labor Code as one of the authorized causes in terminating employment of workers. Although they may be broad and unlimited in scope. The provisions on social justice and protection to labor in the Constitution dictate so. ISSUE: Whether or not petitioners were illegally terminated HELD: Work is a necessity that has economic significance deserving legal protection. Just as no law forces anyone to go into business. the only limitation being that the closure must not be for the purpose of circumventing the provisions on terminations of employment embodied in the Labor Code. It is a basic rule in evidence that each party must prove his affirmative allegation.) The phrase "closure or cessation of operations of establishment or undertaking" includes a partial or total closure or cessation. Other than their mere allegations. whichever is higher.Y. . A fraction of at least six (6) months shall be considered as one (1) whole year. San was not tainted with bad faith or other circumstance that would give rise to suspicions of malicious intent. (Emphasis supplied. San was without factual basis and done in utter bad faith. petitioners failed to present independent evidence that would otherwise show that the closure of M. x x x.Y. therefore. Mere allegation is not evidence. of the business operation of respondent M. the separation pay shall be equivalent to one (1) month pay or at least one-half (1/2) month pay for every year of service.Ministry of Labor and Employment at least one (1) month before the intended date thereof. In case of retrenchment to prevent losses and in cases of closures or cessation of operations of establishment or undertaking not due to serious business losses or financial reverses. The closure. Servidad was employed on May 9. reads: Sec. J. under a contract of employment Section 2 of which. PURISIMA. . until May 10. the EMPLOYEE shall be contractual during which the EMPLOYER can terminate the EMPLOYEE's services by serving written notice to that effect.G. Such termination shall be immediate. INNODATA PHILIPPINES. NATIONAL LABOR RELATIONS COMMISSION. or for a period of six (6) months. This Contract shall be effective for a period of 1 years commencing on May 10. 1994. 1999 JOAQUIN T. 1994. If the EMPLOYEE fails to demonstrate the ability to master his task during the first six months he can be placed on probation for another six (6) months after which he will be evaluated for promotion as a regular employee.R. 1994. INC. SERVIDAD. 1994 to November 10. 1994 by respondent INNODATA as a "Data Control Clerk". 128682 March 18. 1995 unless sooner terminated pursuant to the provisions hereof. Should the EMPLOYEE continue his employment beyond November 10. vs. 2. TODD SOLOMON. No./ INNODATA CORPORATION. respondents. he shall become a regular employee upon demonstration of sufficient skill in the terms of his ability to meet the standards set by the EMPLOYER. From May 10. or at whatever date within the sixmonth period. petitioner.: FACTS: Petitioner Joaquin T. as the EMPLOYER may determine. 1995. closed shops. The law relating to labor and employment is clearly such an area and parties are not at liberty to insulate . The utter disregard of public policy by the contract in question negates the ruling of NLRC that said contract is the law between the parties. the governing principle is that the parties may not contract away applicable provisions of law especially peremptory provisions dealing with matters heavily impressed with public interest. wages. 1995. petitioner received a rating of 98. 1700. They are so impressed with public interest that labor contracts must yield to the common good. collective bargaining. especially provisions relating to matters affected with public policy. et al. it was said: . On July 7. working conditions. the petitioner was given an overall rating of 100% and 98% in the work evaluations conducted by the company. 20 There. which provides: Art. are deemed written into the contract. Put a little differently. On May 9. ISSUE: Whether or not Servidad is a probationary employee? RULING: The private respondent sought to alternatively avail of probationary employment and employment for a fixed term so as to preclude the regularization of the status of petitioner. or after working for six (6) months. provisions of applicable law. . . The relation between capital and labor are not merely contractual.On November 9. such contracts are subject to special laws on labor unions. strikes and lockouts. Pole. petitioner was dismissed from the service on the ground of alleged termination of contract of employment. he was made to sign a three-month probationary employment and later. Similarly telling is the case of Pakistan Airlines Corporation vs. 1994. hours of labor and similar subjects.5% given by the private respondent. In another evaluation. Therefore. an extended threemonth probationary employment good until May 9. The private agreement of the parties cannot prevail over Article 1700 of the Civil Code. 1995. themselves and their relationships from the impact of labor laws and regulations by simply contracting with each other. the petitioner. . Should the EMPLOYEE continue employment beyond November 10. still. it is stipulated that: ". On the averment that NLRC gravely abused its discretion in finding that petitioner failed to meet the standards of the company. . By the provisions of the very contract itself. that the contract litigated upon is valid. The public respondent overlooked the undisputed satisfactory ratings of the performance of petitioner in the two job evaluations conducted by the respondent company. petitioner has become a regular employee of private respondent. Therein. . who was permitted to work beyond six months could not be dismissed on the ground of failure to meet the standards of Innodata. he shall become a regular employee upon demonstration of sufficient skill in the terms of his ability to meet the standards set by the EMPLOYER. 1994. therefore. . we find for petitioner. . The decision at NLRC on the matter simply stated that the petitioner fell short of the expectations of the company without specifying factual basis therefor. . Even granting." . . . allegedly for two reasons: 1) the expiration of their employment contracts. said management contract between Corfarm and MERALCO expired. CARLITO J.[G. . from private respondents terminating their services effective on said date. dated 12 January 1993. Corfarm continued to operate the MERALCO commissary despite the non-renewal of said contract. BARAYANG. RABANG and CIPRIANO Q. On 13 January 1993. April 10. vs. In their respective employment contracts with Corfarm. petitioners.: FACTS: Petitioner Amor Conti was employed by respondent Corfarm as cashier on 2 February 1991. and. J. Petitioner Leopoldo Cruz was employed by the same respondent corporation as a warehouseman on 16 May 1991. 2) the on-going evaluation of their past performances. petitioners received a memorandum. 1997] AMOR CONTI and LEOPOLDO CRUZ.R. 119253. However. PADILLA. On 31 December 1992. and investigation of the internal auditor of Corfarm of certain anomalous transactions involving them (petitioners). NATIONAL LABOR RELATIONS COMMISSION (Third Division). respectively. respondents. Both Amor Conti and Leopoldo Cruz were subsequently promoted to the positions of Head of Commissary and Store Supervisor. these being coterminous with the management contract between Corfarm and MERALCO. it was stipulated that their employment shall be coterminous with the effectivity of the contract executed by and between Corfarm and MERALCO for the management of the latter's commissary (hereinafter referred to as the "management contract"). CORFARM HOLDINGS CORPORATION. No. (b) subsequent notice which informs the employee of the employer's decision to dismiss him. said memorandum did not specify the particular acts or omissions of petitioners. This Court has consistently held that the twin requirements of notice and hearing constitute essential elements of due process in the dismissal of employees. be set aside. and prayed of this Court that the questioned NLRC decision dated 24 November 1994 and resolution dated 26 January 1995. it has been held that the employer must furnish the worker with two written notices before termination of employment can be legally effected: (a) notice which apprises the employee of the particular acts or omissions for which his dismissal is sought. in its "Manifestation and Motion in lieu of Comment". They further contend that the memorandum dated 11 January 1993.ISSUE: Whether or not petitioners were illegally dismissed? RULING: At the outset.As to the requirement of notice. and. With regard to the requirement of a hearing. this Court has held that the essence of due process is simply an opportunity to be heard. Petitioners contend that they were denied due process when they were dismissed without a written notice (specifying the particular charges constituting the grounds for their dismissal). Besides. Petitioners' contentions are meritorious. supposedly issued by Corfarm to petitioners directing them "to explain why they should not be dismissed for alleged acts of negligence and carelessness" was never received by them. dated 19 June 1995. and not that an actual hearing should always and indispensably be held. as required by law. agreed with the findings of the labor arbiter that the petitioners were illegally dismissed. and a hearing. It merely stated that based on the results of the investigation conducted by Corfarm's internal audit staff. petitioners were found to have been negligent in the performance of their duties. . it will be noted that the Office of the Solicitor General (OSG). R.” After having entered into successive contracts of the same nature with SMC. Claiming that they were illegally dismissed. Respondents.” but began implementing in 1993 the “Pre-Selling System” in which the salesmen under the earlier system would be replaced by Accounts Specialists which called for upgraded qualifications. hence. Petitioners. and the members of the regular Route Crew then existing were required to undergo a training program to determine whether they possessed or could be trained for the necessary attitude and aptitude required of an Accounts Specialist. as the same was merely occasioned by the need to fill in a vacuum arising from SMC’s gradual transition to a new system of selling and delivering its products. MARCELO DELA CRUZ III. 150658 February 9. HENRY MALIWANAG. ROGELIO LASAT. co-terminus with the completion of the transition period and Training Program for all prospective Accounts Specialists. the services of petitioners were terminated after SMC no longer agreed to forge another contract with them. MANUEL DELOS SANTOS. Respondents explained that SMC previously operated under the “Route System.FABELA vs SAN MIGUEL CORPORATION Case Digest [G. FACTS: Petitioners were hired by respondent San Miguel Corporation (SMC) as “Relief Salesmen” for the Greater Manila Area (GMA) under separate but almost similarly worded “ Contracts of Employment with Fixed Period. Respondent SMC claimed that the hiring of petitioners was not intended to be permanent. vs. SAN MIGUEL CORPORATION and ARMAN HICARTE. While some of the qualified regular salesmen were readily upgraded to the position of Accounts Specialist. No. ISSUE: . and ROMMEL QUINES. petitioners filed complaints for illegal dismissal against respondents. thus giving rise to the need for temporary employees. 2007] NOELITO FABELA. the hiring of petitioners and others for a fixed period. respondents claimed that SMC still had to sell its beer products using the conventional routing system during the transition stage. Unfortunately. . whether continuous or broken. it has been clarified that employment for a fixed period is not in itself illegal.Whether or not petitioners were validly hired for a fixed period. that petitioner Fabela. those whose “employment has been fixed for a specific project or undertaking. 1995. and should thus be ignored.” Project employment is distinct from casual employment referred to in the second paragraph of Article 280 for the proviso that “any employee who has rendered at least one year of service .The contract of employment of petitioner Fabela. even if clear as regards the existence of a period. states that the transition period from the Route System to the Pre-Selling System would be twelve (12) months from April 4. however. Although Article 280 does not expressly recognize employment for a fixed period. besides being hired again for another fixed period of four (4) months after the lapse in April 1996 of the one-year contract. had already been working for respondent SMC on a fixed-term basis as early as . namely: (1) those who are engaged to perform activities which are necessary or desirable in the usual business or trade of the employer. shall be considered a regular employee” does not apply to project employees. Even if the duties of an employee consist of activities usually necessary or desirable in the usual business of the employer. it does not necessarily follow that the parties are forbidden from agreeing on a period of time for the performance of such activities through a contract of employment for a fixed term. HELD: The SC held that under article 280 of the Labor Code. respondents’ contention that there are fixed periods stated in the contracts of employment does not lie. Article 280 also recognizes project employees. for instance. with respect to the activity in which they are employed. Brent instructs that a contract of employment stipulating a fixed-term. is invalid if it can be shown that the same was executed with the intention of circumventing security of tenure. It bears noting. . but only to casual employees. Indeed. there are two kinds of regular employees. which is distinct from employment which has been fixed for a specific project or undertaking. and (2) those casual employees who have rendered at least one year of service. substantial evidence exists in the present case showing that the subject contracts were utilized to deprive petitioners of their security of tenure. ROMEO MOJELLO. DONALD ALPUERTO. MARITESS MOJELLO. NANCY VINGNO. such as when the employee himself insists upon the period. JR. G.. GENE FERNANDO. DIOLITO SENELONG. JOVEN FERNANDO. LORNA PORRAS. April 15. ERNESTO MOJELLO. LUCIA LOMBO. ANTONIO PORRAS. there is sufficient basis to believe that the shift of SMC to the Pre-Selling System was not the real basis for the forging of fixed-term contracts of employment with petitioners and that the periods were fixed only as a means to preclude petitioners from acquiring security of tenure. ALMA YANSON. Petitioners. INC. MERCEDES EMPERADO. 2005 HACIENDA BINO/HORTENCIA STARKE.. 150478. ANA. JESSICA MOJELLO. CANDIDO CUENCA. ELMO DULINGGIS. ELIAS LOMBO. ROGELIO CHAVEZ. REYNALDO PEDUHAN. ZALDY PABALINAS. ARGENE SERON. JR. JOHN PEDUHAN. EMMA LOMBO. HERNANI FERNANDO. JARDIOLINA PABALINAS. EDNA TADLAS. NOLI PABALINAS. FEDERICO STA. MARIA SANGGA. TERESITA FERNANDO. ADELA MOJELLO.1992. REYNALDO SENELONG. RODRIGO SANGGA. JOSE MOJELLO. vs. JOAQUIN PEDUHAN. MARCOS ROBERTO. . ARMANDO SENELONG. JULIANA ENCARNADO. a definite date of termination is a sine qua non. ALICIA ROBERTO. VALERIANA MOJELLO. or where the nature of the engagement is such that. ANTONIO LOMBO. NIDA BANGALISAN. LAURO PABALINAS./HORTENCIA L. without being seasonal or for a specific project. FRANCISCO ACULIT. Respondents. TORIBIO EMPERADO. JOSE TITONG. JOSEPHINE PEDUHAN. and RAMELO TIONGCO. ARTURO TITONG.R. JOEL MALACAPAY. RODOLFO NAPABLE. ANGELINA ALMONIA. A fixed-term employment is valid only under certain circumstances. No. JIMMY REYES. SALVADOR MALACAPAY. MERLITA MOJELLO. ROGELIO SUASIM. BONIFACIO GADON. or one year before respondent SMC even began its shift to the Preselling System in 1993. SEGUNDIA OCDEN.. VICENTE SENELONG. JAIME NEMENZO. FRUCTOSO MOJELLO.. RONALDO MOJELLO. ANGELINO SENELONG. Thus. ALFREDO PANOLINO. RUBEN PABALINAS. MYRNA VILLANUEVA BELENARIO.. SAMUEL SERON. Petition is granted. JOSE GALLADA. STARKE. RAMONITO KILAYKO. REYNALDO ENCARNADO. ALFREDO LASTIMOSO. LAURENCIA LOMBO. JR. JIMMY YANSON. SR. JR. ROGELIO PEDUHAN. ROLANDO KILAYKO. the petitioner refused to sit down to negotiate a CBA. they are regular and not seasonal employees. the workers were merely required to perform phases of agricultural work for a definite period of time. the complainants staged a strike to protest but was settled through a memorandum of agreement which contained a list of those considered as regular employees for the payroll.. NLRC is not applicable since in that case.CALLEJO. The evidence only proved the first but not the second requirement. . Moreover. When the union became the collective bargaining representative in the certification election.: FACTS: The petitioner disfavored the fact that the private respondent employees have formed a union. The ruling in Mercado v. J. after which. As a result. it is likewise guilty of ULP. The management's sudden change of assignment reeks of bad faith. it is not enough that they perform work that is seasonal in nature but they also are employed for the duration of one season. For them to be excluded as regulars. the respondents were not given work for a month amounting to unjustified dismissal. The NLRC held that there was illegal dismissal and this was affirmed by the Court of Appeals. ISSUE: W/N the employees are regular workers RULING: Yes. their services are available to other employers. SR. RONALD Q. AUSTRIA-MARTINEZ.: Facts: The respondents alleged that they were regular employees of petitioners tasked with the maintenance and repair of the resort facilities.R. 2008 COCOMANGAS HOTEL BEACH RESORT and/or SUSAN MUNRO. JOHNNY G. No.G. petitioners. They later on discovered that not less than ten workers were subsequently hired by petitioners to do repairs in two cottages of the resort and two workers were retained after the completion without respondents being allowed to resume work. TIBUS. Issue: Whether respondents are regular or project employees Held: . VISCA and RAFFIE G. RICHARD G. respondents. VISCA. vs. BAREDO. FEDERICO F. J. 167045 August 29. They did not report for work after they were informed that the ongoing constructions and repairs would be temporarily suspended because they caused irritation and annoyance to the resort's guests and due to budgetary constraints. VISCA. and windbreakers and other resort facilities." "carpenter" and "mason. Petitioners' failure to file termination reports is an indication that the respondents were not project employees but regular employees. motor boats. The repeated and continuing need for their services is sufficient evidence of the necessity. cottages. While they had designations as "foreman. 20. More importantly. of their services to petitioners' resort business. the completion or termination of which has been determined at the time of the engagement of the employee or where the work or service to be performed is seasonal in nature and the employment is for the duration of the season.They are regular employees. A project employee is one whose "employment has been fixed for a specific project or undertaking. of the termination of the services of the workers every time completes a project. not project employees. In the present case. a report must be made to the nearest employment office. as well as the old Policy Instructions No. 19." they performed work other than carpentry or masonry. They were tasked with the maintenance and repair of the furniture. There is likewise no evidence of the project employment contracts covering respondents' alleged periods of employment. since they worked continuously for petitioners from three to twelve years without any mention of a "project" to which they were specifically assigned. That respondents were regular employees is further bolstered by the following evidence: . if not indispensability. there is no evidence that petitioners reported the termination of respondents' supposed project employment to the DOLE as project employees." Before an employee hired on a per-project basis can be dismissed. This Court has held that an employment ceases to be coterminous with specific projects when the employee is continuously rehired due to the demands of employer’s business and re-engaged for many more projects without interruption. requires employers to submit a report of an employee’s termination to the nearest public employment office every time his employment is terminated due to a completion of a project. Department Order No. respondents cannot be classified as project employees. JULIUS ABANES. CHRISTOPHER BIOL. Among its clients was Uniwide Sales. J. . Petitioner Joseph James Dequito was. SAMMY MESAGAL. 157680 October 8. ALEX ALBINO. and CONRADO SULIBAGA. On various occasions involving different projects.(a) the SSS Quarterly Summary of Contribution Payments listing respondents as employees of petitioners. ETS was only able to pay its employees 13th month pay equivalent to two weeks’ salary. (b) the Service Record Certificates stating that respondents were employees of petitioners for periods ranging from three to twelve years and all have given "very satisfactory performance". Inc. REYNALDO LIMA. ETS hired the services of private respondents as pipe fitters. ETS experienced financial difficulties when Uniwide.1 albeit the CA referred to him as ETS’ president. ERNESTO PADILLA. MARCELITO GAMAS. MIGUEL ALINAB. FLORO PACUNDO. NELSON CATONG. In December 1998. 2008 EQUIPMENT TECHNICAL SERVICES or JOSEPH JAMES DEQUITO.R. (Uniwide). respondents. during the period material. REY ALBINO. COURT OF APPEALS. JR. As a result. failed to pay for the plumbing work being done at its Coastal Mall. its client at the time. or threaders. plumbers. vs. occupying the position of manager of ETS. RENATO DULOT.. petitioners. G. (c) petty cash vouchers showing payment of respondents' salaries and holiday and overtime pays. No.: FACTS: Petitioner Equipment Technical Services (ETS) is primarily engaged in the business of sub-contracting plumbing works of on-going building construction. VELASCO. Floro Pacundo v. their respective position papers. ETS was constrained to deny employment to private . docketed as NLRC NCR Case No. (2) they were not illegally dismissed. Equipment Technical Services or Joseph James Dequito. Marcelito Gamas. (3) ETS has not paid them their salaries. and (4) they are entitled to reinstatement to their former positions with paid backwages in addition to their money claims and payment of attorney’s fees. Conrado Sulibaga. Christopher Lamayon v. 00-0100571-99 and entitled as Alex Albino. i. Julius Abanes. Ernesto Padilla. Sammy Mesagal. and Rey Albino. overtime pay. Richville project. all concerned.Unhappy over what they thought was ETS’ failure to release the balance of their 13th month pay. two other cases were filed against ETS for illegal dismissal and payment of money claims when the complainants thereat were refused work in another ETS project. Miguel Alinab. private respondents brought their case before the Arbitration Branch of the NLRC. Equipment Technical Services or Joseph James Dequito. (5) ETS asked private respondents to sign employment contracts to formalize their previous agreement but said private respondents refused. (2) ETS dismissed them without cause and without due process after they filed cases for money claims against ETS in the arbitration branch of the NLRC. docketed as NLRC NCR Case No. These two other cases were Nelson Catong. Reynaldo Lima v. except Roger and Christopher Lamayon. Private respondents’ position2 is summed up as follows: (1) they are regular employees of ETS. service incentive leave pay. having been hired on a per project basis. ETS’ position may be summed up as follows: (1) private respondents were its contractual/project employees engaged for different projects of the company. 00-02-01429-99. and premium pay for holidays and rest days. Roger Lamayon. Christopher Biol. the Richville project. submitted. 00-02-01615-99. because the chances of being paid by Uniwide were dim.. Equipment Technical Services or Joseph James Dequito. allegedly because they refused to sign individual employment contracts with ETS. The three cases were consolidated before the labor arbiter. 13th month pay.e. (3) ETS was unable to fully release private respondents’ 13th month pay because Uniwide failed to pay for its contracted plumbing project. Later. (4) ETS was forced to abandon the Uniwide project and undertake another project. as the labor arbiter directed. Renato Dulot. and (6) as a result. Following failed conciliation efforts. docketed as NLRC NCR Case No. defining a regular employee vis-à-vis a project employee." as distinguished from "regular employee. 280. – The provisions of written agreement to the contrary notwithstanding and regardless of the oral agreement of the parties." the duration and scope of which were specified at the time the employees were engaged for that project. confirmatory for the most part of that of the labor arbiter. an employment shall be deemed to be regular where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer. was submitted by ETS despite the latter’s allegations that private respondents were merely contractual employees. that is. ISSUE: Whether or not employees were project employees? RULING: The principal test for determining whether an employee is properly characterized as "project employee.8 And as Article 280 of the Labor Code. except where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee x x x. Records of payroll and other pertinent documents. Given this postulate. . But the categorical finding of the CA. or any other project. Regular and casual employment. were also not submitted by ETS.respondents as it considered the execution of employment contracts part of management prerogative before employment commences. such as job contracts secured by ETS showing that private respondents were hired for specific projects. It bears to stress at the outset that ETS admits hiring or employing private respondents to perform plumbing works for various projects. regular employment may reasonably be presumed and it behooves ETS to prove otherwise. is that not a single written contract of employment fixing the terms of employment for the duration of the Uniwide project. that the employment in question was contractual in nature ending upon the expiration of the term fixed in the contract or for a specific project or undertaking." is whether or not "the project employee" was assigned to carry out "a specific project or undertaking. would have it: Art. the fact that petitioners had rendered more than one year of service at the time of their dismissal overturns private respondent’s allegations that petitioners were hired for a specific or fixed undertaking for a limited period of time. Its failure to submit reports of termination cannot but sufficiently convince us further that petitioners are truly regular employees. Under Policy Instruction No. Series of 1977. As correctly held by the CA in its Amended Decision. if private respondents were indeed employed as project employees. NLRC is also apropos. NLRC.Moreover. the report must be made to the nearest public office employment. The decision in Violeta v. 20. ETS’ failure to report the employment termination and file the necessary papers after every project completion tends to support the claim of private respondents about their not being project employees. considering that petitioners were hired and again [hired] for various projects or phases of work therein. particularly when it held: [The employer] should have filed as many reports of termination as there were construction projects actually finished if petitioners [employees] were indeed project employees. citing Tomas Lao Construction v. . petitioners should have had submitted a report of termination every time their employment was terminated owing to the completion of each plumbing project. Just as important. Petitioners filed a complaint for illegal dismissal. UNIVERSAL ROBINA SUGAR MILLING CORPORATION G. 2007 FACTS: Universal Robina Sugar Milling Corporation (respondent) is a corporation engaged in the cane sugar milling business. 159343. regularization. Regular and Casual Employees.CACERES VS. – The provision of written agreement to the contrary notwithstanding and regardless of the oral agreement of the parties. an employment shall be deemed to be regular where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer. incentive leave pay. September 28. they were made to sign a Contract of Employment for Specific Project or Undertaking. No. At the start of their respective employments. . 280. while Andito Pael (petitioner Pael) in 1993. damages and attorney‘s fees.R. 13th month pay. Issue: Whether or not the petitioners are seasonal/project/term employees and not regular employees of respondents Ruling: Article 280 of the Labor Code provides: ART. until May 1999 when they were informed that their contracts will not be renewed anymore. Petitioners' contracts were renewed from time to time. Pedy Caseres (petitioner Caseres) started working for respondent in 1989. shall be considered a regular employee with respect to the activity in which he is employed and his employment shall continue while such actually exists. the completion or termination of which has been determined at the time of the engagement of the employee. and be informed thereof at the time of hiring. An employment shall be deemed to be casual if it is not covered by the preceding paragraph: Provided. (b) project employees or those ―whose employment has been fixed for a specific project or undertaking. would clearly reveal that the very nature of the terms and conditions of their hiring would show that complainants were required to perform phases of special projects which are . whether such service is continuous or broken. and (c) casual employees or those who are neither regular nor project employees. On this score. The foregoing provision provides for three kinds of employees: (a) regular employees or those who have been ―engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer‖. A true project employee should be assigned to a project which begins and ends at determined or determinable times. the completion or termination of which has been determined at the time of the engagement of the employee or where the work or service to be performed is seasonal in nature and the employment is for the duration of the season.except where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season. That. The principal test for determining whether an employee is a project employee or a regular employee is whether the employment has been fixed for a specific project or undertaking. the LA ruled: This is further buttressed by the fact that the relationship between complainants and the respondent URSUMCO. any employee who has rendered at least one year of service. Petitioners contend that respondent's repeated hiring of their services qualifies them to the status of regular employees. the completion or termination of which has been determined at the time of the engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season‖. A project employee is one whose employment has been fixed for a specific project or undertaking. Caseres was made to understand that his services would be co-terminus with the work to which he would be then assigned that is from July 17. The NLRC. further ruled that: In the case at bar. . that is until February 5. Upon application. 1989 to July 20. and that thereafter. 1989 as a worker assisting the crane operator at the transloading station. This is so because the planting of sugar does not entail a whole year operation. Finally. As in the first contract. Like his first assignment. Caseres' services were co-terminus with the work to which he was assigned. We note that complainants never bothered to deny that they voluntarily. the CA noted: Petitioner Pedy Caseres first applied with private respondent URSUMCO on January 9. x x x it is clear that the contracts of employment are valid and binding on the complainants. Neither was there any showing that respondents exercised moral dominance on the complainants. Caseres was interviewed and made to understand that his employment would be co-terminus with the phase of work to which he would be then assigned. 1989. their services are available to other farm owners. 1989 and that thereafter he is free to seek employment elsewhere to which Caseres agreed and readily signed the contract of employment for specific project or undertaking issued to him.not related to the main operation of the respondent for a definite period. Caseres re-applied with respondent as a seasonal project worker assisting in the general underchassis reconditioning to transport units on July 17. and utility works are comparatively small during the off-milling season. 1989 and thereafter he would be free to seek employment elsewhere. Caseres agreed and signed the contract of employment for specific project or undertaking. Thereafter Caseres voluntarily signed several other employment contracts for various undertakings with a determinable period. knowingly and willfully executed the contracts of employment. The execution of these contracts in the case at bar is necessitated by the peculiar nature of the work in the sugar industry which has an off milling season. The very nature of the terms and conditions of complainants' hiring reveals that they were required to perform phases of special projects for a definite period after. he was free to seek employment with other sugar millers or elsewhere. agreeing with the LA. After an absence of more than five (5) months. after which their services are available to any farm owner. J.The nature and terms and conditions of employment of petitioner Andito Pael were the same as that of his co-petitioner Caseres. 003767-92 dismissing for lack of merit the appeal from the decision 2 of the Philippine Overseas and Employment Administration (POEA) in POEA Case No. BONIFACIO M. et al. DAVILA. 277 SCRA 439). It must be noted that there were intervals in petitioners' respective employment contracts.R. the employment of URSUMCO's work force was not permanent but co-terminous with the projects to which the employees were assigned and from whose payrolls they were paid (Palomares vs.: FACTS: Petitioner Philippine National Construction Corporation (PNCC) asks that we set aside the resolution 1 of public respondent National Labor Relations Commission (NLRC) in NLRC NCR CA No. ROQUERO. respondents. and that their work depended on the availability of such contracts or projects. and completion bonus differentials. Length of service is not the controlling determinant of the employment tenure of a project employee (Rada vs. vacation and sick leave. petitioner. private respondents Alfredo Davila and Bonifacio Roquero sought to recover from the petitioner salary.) G. Davila further asked for payment of his salary corresponding to the unexpired portion of his contract. PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION. NLRC. Consequently. No. Petitioners' repeated and successive re-employment on the basis of a contract of employment for more than one year cannot and does not make them regular employees. Philippine National Construction Corporation (PNCC). vs. NATIONAL LABOR RELATIONS COMMISSION. They therein alleged that they had been working as security guards . and ALFREDO I. DAVIDE. JR. 90-10-1183 entitled "Alfredo Davila and Bonifacio Roquero vs." In the complaint filed with the POEA. overtime pay.. NLRC. 112629 July 7. 1995 PHILIPPINE NATIONAL CONSTRUCTION CORPORATION (PNCC).. of PNCC since 1980. however.00/month Jobsite : Samawah. .00 a month. Thus. The contracts which bound them were those providing for a salary of US$260. before they left they were made to sign printed forms in blank. The PNCC resisted the complaint by claiming that the so-called Master Employment Contracts relied upon by the private respondents were but notices or offers for overseas employment. the printed forms they had earlier signed in blank already contain an entry that their salary rate is US$260. other relevant data are as follows: Position :Company Guard Salary : US$350. They found out to their disgust that contrary to the master employment plan. Their contracts are evidenced by master employment contracts approved by the POEA which explicitly state: This is to confirm your employment with the Philippine National Construction Corporation-Iraq Expressway Project (Employer/Principal) . and mere offers without acceptance by them do not constitute contracts of employment. they were assigned as company security guards at PNCC Iraq Expressway Project with a salary of US$350. . private respondent Roquero received only US$260. they were paid only two-hour overtime pay at the rate of US$260. The necessary papers for their overseas assignment were not given to them not until they were already at the Manila International Airport. For their four-hour daily overtime work. Private respondent Davila received the same salary until he was repatriated prior to the expiration of his contract due to a reduction of work force.00 as monthly salary during his entire two-year assignment in Iraq and three-week extended period of assignment therein.00 per month.00 per month. Having passed the criteria set by PNCC for overseas workers.00 a month each. Iraq Commencement of contract: Upon Departure They departed for Iraq on 14 May 1985. ISSUE: Whether or not the private respondents are employees of PNCC RULING: . they can no longer be disturbed by this Court. and there is no appeal. nor any plain.00 a month or US$260. speedy. and adequate remedy in the ordinary course of law. however. which was affirmed by the NLRC. or with grave abuse of discretion. At any rate. The only dispute which remains unsolved is whether or not the monthly salary of herein complainants is US$350. discloses that the findings of facts therein are supported by substantial evidence. It is settled that before certiorari may be availed of. or decision of the Commission based on palpable or patent errors. . It is doctrinally entrenched that the factual findings of labor officials are conclusive and binding on this Court when supported by substantial evidence. 9 Section 14. . be shown that the NLRC has acted without or in excess of jurisdiction.00. board. in an earlier case brought by the petitioner and involving the same issue but with other employees similarly situated as the private respondents. resolution.It is true that the only way by which a labor case may reach this Court is through a petition for certiorari under Rule 65 of the Rules of Court. 8 It must. 10 The petitioner has not endeavored to show any justifiable reason why it did not file a motion for reconsideration to give the NLRC an opportunity to re-examine its resolution. 12 this Court upheld the resolution of the NLRC affirming the POEA findings as follows: . or office concerned to pass upon and correct its mistakes without the intervention of the higher court. Such a motion constitutes a plain. 11 An examination of the decision of the POEA. the petitioner must have filed a motion for the reconsideration of the order or act complained of to enable the tribunal. Besides. As correctly invoked by complainants paragraph (i) of Article 34 of the Labor Code prohibits the substitution or alteration of employment contracts approved and verified by the Department of Labor from the time (of) the actual signing thereof by the parties up to and including the period of expiration of the same without the approval of the Department of Labor. and adequate remedy which the aggrieved party may avail of. Rule VII of the New Rules of Procedure of the NLRC allows an aggrieved party to file a motion for the reconsideration of any order. at the bottom of the petitioner's grievance is an issue of fact. Hence. speedy. . CONSUNJI. Skeptic of private respondent's reason. This being so. are also entitled to be paid thereto based on the monthly salaries of US$350. Consunji. He became a skilled welder and worked for private respondent until March 23. 106090 February 28. on November 5. 1986 when his employment was terminated on the ground that the project petitioner had been assigned to was already completed and there was no more work for him to do.00 and not US$260. J. G.00.With regard to the first issue in this case the approved contract of employment of the herein complainants with the respondent is US$350. This can be inferred from the POEA approved contract of employment and by the certification issued by respondent's chief recruiting officer. 1974. "G-1") during the durations of their contract. INC. vs. Complainants having been granted voluntarily by the respondent a two-hour daily overtime (Exh. After filing their respective position papers and other documents pertinent to their causes/defenses. NATIONAL LABOR RELATIONS COMMISSION and D. a construction firm.. .: FACTS: Petitioner was hired as a laborer at the D. M. petitioner brought his plight before the Labor Arbiter who consolidated the same with three (3) other separate complaints for illegal dismissal and various money claims against private respondent.00 a month. No.M. the parties agreed to submit the case for decision based on record. "G". NOCON. The petitioner's contention that the private respondents' claims are barred by laches do not deserve even a short shrift. 1994 RICARDO FERNANDEZ. Inc. herein complainants have the right to be paid as monthly salaries the aforementioned amount. petitioner.. respondents.R. finding that complainants worked continuously in various projects ranging from five (5) to twenty (20) years and belonged to a work pool. National Labor Relations. ISSUE: Whether or not petitioner belonged in a work pool? RULING: Noteworthy in this case is the fact that herein private respondent's lay-off reports and the termination reports were duly submitted to the then Ministry of Labor and Employment everytime a project was completed in accordance with Policy Instruction No. regardless of the number of projects in which they have been employed by a particular construction company. the faithful and regular effort of private respondent in reporting every completion of its project and submitting the lay-off list of its employees proves the nature of employment of the workers involved therein as project employees. 8 uniformly held that the failure of the employer to report to the nearest employment office the termination of workers everytime a project is completed proves that the employees are not project employees. it is clear that he does not belong to the work pool from which the private respondent would draw workers for assignment to other projects at its discretion. Given this added circumstance behind petitioner's employment. The presence of this factor makes this case different from the cases decided by the Court where the employees were deemed regular employees. 5 Philippine National Construction Corporation v. 20. . 7 and Philippine National Construction Corporation v. National Labor Relations Commission. Contrariwise. Labor Arbiter Fernando V. which provides: Project employees are not entitled to termination pay if they are terminated as a result of the completion of the project or any phase thereof in which they are employed. 1988. The cases of Ochoco v. Moreover. National Labor Relations Commission. 6 Magante v. Cinco rendered a decision. National Labor Relations Commission.On May 12. the company is not required to obtain a clearance from the Secretary of Labor in connection with such termination. What is required of the company is a report to the nearest Public Employment Office for statistical purposes.. et al. AND PAUILINO ENERO v. 120969 Facts: Maraguinot and Enero were separately hired by Vic Del Rosario under Viva Films as part of the filming crew. On June 1992. The private respondents claim the following: (a) that VIVA FILMS is the trade name of VIVA PRODUCTIONS. NLRC. INC. sought the assistance of their supervisor to facilitate their request that their salary be adjusted in accordance with the minimum wage law. Mr.ALEJANDRO MARAGUINOT. Sometime in May 1992. Vic Del Rosario would agree to their request only if they sign a blank employment contract. (b) That they hire contractors called “producers” who act as independent contractors as that of Vic Del Rosario. After which. VIC DEL ROSARIO. he was terminated. the Mr. Cesario. Mrs. Maraguinot on the other hand was dropped from the payroll but was returned days after. and (c) As such.but not then making of movies. there is no employee-employer relation between petitioners and private respondents. Petitioners refused to sign such document. JR. Enero was forced to go on leave on the same month and refused to take him back when he reported for work. . told them that Mr. Consequently. their supervisor. the petitioners sued for illegal dismissal before the Labor Arbiter. He was again asked to sign a blank employment contract but when he refused. and that it was primarily engaged in the distribution & exhibition of movies. VIVA FILMS GR No. The Labor Arbiter held that the complainants are employees of the private respondents. they filed an instant petition claiming that NLRC committed a grave abuse of discretion in: (a) Finding that petitioners were project employees. As a result. (b) Ruling that petitioners were not illegally dismissed. the total working hours logged extremely varied. reasons: (a) Complainants were hired for specific movie projects and their employment was co-terminus with each movie project. The private respondents appealed to the NLRC which reversed the decision of the Labor Arbiter declaring that the complainants were project employees due to the ff. Held: There exist an employee.employer relationship between the petitioners and the private respondents. In effect. (b) W/N the private respondents are engaged in the business of making movies. (c) W/N the producer is a job contractor. the said employees are illegally dismissed. In the instant case. (b)The work is dependent on the availability of projects. and (d) The respondents alleged that the complainants are not prohibited from working with other movie companies whenever they are not working for the independent movie producers engaged by the respondents. Thus. A motion for reconsideration was filed by the complainants but was denied by NLRC. (c) The extremely irregular working days and hours of complainants work explains the lump sum payment for their service. That the producers are not independent contractor but should be considered as labor-only contractors and as such act as mere agent of the real employer. reasons that nowhere in the appointment slip does it appear that it was the producer who hired the crew . the petitioners allege that the NLRC acted in total disregard of evidence material or decisive of the controversy. and (c) Reversing the decision of the Labor Arbiter.employer relationship between the petitioners and the private respondents because of the ff. Issues: (a) W/N there exist an employee. necessary and indispensable to the usual business or trade of the employer. The said producer.) a. Under Article 106 of the Labor Code (reworded) where the contractor does not have the requisites as that of the job contractors. Respondents also admit that the petitioners were part of a work pool wherein they attained the status of regular employees because of the ff. The producer is not a job contractor because of the ff. machinery. reasons: (Sec. A contractor carries on an independent business and undertakes the contract work on his own account under his own responsibility according to his own manner and method. It can be said that VIVA is engaged of making movies and not on the mere distribution of such. requisites: (a) There is a continuous rehiring of project employees even after cessation of a project. does not have his own tools. The contractor should have substantial capital and materials necessary to conduct his business. the length of time which the employees are continually re-hired is not controlling but merely serves as a badge of regular employment. b. Since the producer and the crew members are employees of VIVA and that these employees’ works deal with the making of movies. . and (c) However. Book III of the Omnibus Rules Implementing the Labor Code. work premises and other materials to make motion pictures. (b) The tasks performed by the alleged “project employees” are vital. it was VIVA’s corporate name appearing on heading of the slip. The said producer has a fix time frame and budget to make the movies.members. Del Rosario. Moreover. free from the control and direction of his employer or principal in all matters connected with the performance of the work except as to the results thereof. equipment. It can likewise be said that it was VIVA who paid for the petitioners’ salaries. It can be said that the producers are labor-only contractors. Such materials were provided by VIVA. Rule VII. nêt . including private respondent. petitioners. (2) to call the laundry woman to wash dirty linen. The barbers got two-thirds (2/3) of the fee paid for every haircut or shaving job done. respondents. (3) to recommend applicants for interview and hiring. 121605 February 2. while one-third (1/3) went to the owners of the shop. vs. Dina Tan. No.1âwphi1. All the employees. J. 2000 PAZ MARTIN JO and CESAR JO. For this additional job. sold the barbershop to petitioners Paz Martin Jo and Cesar Jo. Private respondent's duties as caretaker. were absorbed by the new owners. In 1970.G. were: (1) to report to the owners of the barbershop whenever the airconditioning units malfunctioned and/or whenever water or electric power supply was interrupted. (4) to attend to other needs of the shop. The owners and the barbers shared in the earnings of the barber shop. NATIONAL LABOR RELATIONS COMMISSION and PETER MEJILA. In 1977.R.: FACTS: Private respondent Peter Mejila worked as barber on a piece rate basis at Dina's Barber Shop. he was given an honorarium equivalent to one-third (1/3) of the net income of the shop. the owner. in addition to his being a barber. petitioners designated private respondent as caretaker of the shop because the former caretaker became physically unfit. QUISUMBING. The name of the barbershop was changed to Windfield Barber Shop. In this new location. attorney's fees and damages. In order to give the parties enough time to cool off. from February 1990 to March 1991 — P800. became serious so that private respondent reported the matter to Atty. Meanwhile. Abragan's office a new twist was added. it was found out that the dispute was not between private respondent and petitioners. Significantly.300. Atty. Accordingly. the barbershop closed. But. the complaint did not seek reinstatement as a positive relief. Abragan set another conference but private respondent did not appear in such meeting anymore. to wit: from February 1986 to 1990 — P700. But soon a place nearby was rented by petitioners and the barbershop resumed operations as Cesar's Palace Barbershop and Massage Clinic. Upon investigation. 1993. private respondent demanded payment for several thousand pesos as his separation pay and other monetary benefits. Allan Macaraya of the labor department. The bickerings. ISSUE: . Prudencio Abragan. but with a fixed monthly honorarium as caretaker. private respondent continued to be a barber and caretaker. on January 2. On January 12. In November 1992. The labor official immediately summoned private respondent and petitioners to a conference. Despite the assurance that he was not being driven out as caretakerbarber. 1993. to thresh out the problem.When the building occupied by the shop was demolished in 1986. characterized by constant exchange of personal insults during working hours. On January 8. During the mediation meeting held at Atty. private respondent had an altercation with his co-barber. Atty. private respondent filed a complaint2 for illegal dismissal with prayer for payment of separation pay. Macaraya directed petitioners' counsel. and from July 1992 P1. 1993. private respondent continued reporting for work at the barbershop. rather. Atty. other monetary benefits. he began working as a regular barber at the newly opened Goldilocks Barbershop also in Iligan City. Jorge Tinoy. it was between the former and his fellow barber. he turned over the duplicate keys of the shop to the cashier and took away all his belongings therefrom. albeit contested by the latter. With regard to the second issue. the following facts indubitably reveal that petitioners controlled private respondent's work performance. (3) he had to be at the shop at 9:00 a.Whether or not Magcalas is a regular employee. Hence. we entertain no doubt that private respondent was employed by petitioners as caretaker-barber. and could leave only at 9:00 p. there must be concurrence of the intention to abandon and some overt acts from which it may be inferred that the employee concerned has no more interest in working. private respondent was paid by petitioners wages in the form of honorarium. Initially. as new owners of the barbershop. Undoubtedly. (2) he could only recommend the hiring of barbers and masseuses. the services performed by private respondent as barber is related to. On the contrary. In fact.7 These duties were complied with by the private respondent upon instructions of petitioners. there was enough basis to declare private respondent an employee of petitioners. originally. Moreover. private respondent earned two-thirds (2/3) of the fee paid per haircut or shaving job done. Accordingly. Certainly. it was crucial to the business operation of petitioners as shown in the preceding discussion.8 In other words. such task was far from being negligible as claimed by petitioners. being the one entrusted with the key. at the rate of one-third (1/3) of the shop's net income but subsequently pegged at a fixed amount per month. Furthermore. As a barber. there is no cogent reason to disturb the findings of the labor arbiter and NLRC on the existence of employer-employee relationship between herein private parties. private respondent sued petitioners for illegal dismissal. there must be a clear.m. because he was the one who opened and closed it. in that: (1) private respondent had to inform petitioners of the things needed in the shop. deliberate and .m. hired private respondent as barber by absorbing the latter in their employ. Later on. jurisprudence has laid out the rules and valid ground for termination of employment. As a caretaker. petitioners had the power to dismiss private respondent being the ones who engaged the services of the latter. petitioners. petitioners tapped private respondent to serve concurrently as caretaker of the shop. not just a project employee RULING: Absent a clear showing that petitioners and private respondent had intended to pursue a relationship of industrial partnership. and in the pursuit of the principal business activity of petitioners. with petitioners having the final decision. To constitute abandonment. five (5) years. 1990 en banc FACTS: Private respondent Doroteo R.000. to July 17.therefore he had acquired the status of regular employee .71. BRENT SCHOOL. 1976.00. ALEGRE G. Inc. to July 17. as those contained in the original contract of July 18. 1971." The Regional Director considered Brent School's report as an application for clearance to terminate employment (not a report of termination). and signed a receipt therefor containing the phrase.DIMACHE vs.177. L-48494 February 5. Alegre was given a copy of the report filed by Brent School with the Department of Labor advising of the termination of his services effective on July 16. 1973. "in full payment of services for the period May 16. 1976 as full payment of contract.e. RONALDO ZAMORA and DOROTEO R.Alegre accepted the amount of P3.R. 1973. and . 1974 reiterated the same terms and conditions. and his employment lasted for 5 years . The contract fixed a specific term for its existence. INC. The stated ground for the termination was "completion of contract. the date of execution of the agreement. at a yearly compensation of P20. and September 14. August 28. No. 1976. 1971. Alegre was engaged as athletic director by petitioner Brent School.unjustified refusal to resume employment and a clear intention to sever the employer-employee relationship on the part of the employee. expiration of the definite period of employment.1976. Subsequent subsidiary agreements dated March 15. i. from July 18. including the expiry date. On April 20.." Although protesting the announced termination stating that his services were necessary and desirable in the usual business of his employer. RULING: Respondent Alegre's contract of employment with Brent School having lawfully terminated with and by reason of the expiration of the agreed term of period thereof. as amended. or employment with a fixed or definite period. itself deals with obligations with a period. Nevertheless. The status of legitimacy continued to be enjoyed by fixed-period employment contracts under the Labor Code (PD 442). It is plain then that when the employment contract was signed between Brent School and Alegre. the validity of term employment was impliedly recognized by the Termination Pay Law. as amended by R. which was approved on June 18. .A. he is declared not entitled to reinstatement. at a time when the Labor Code of the Philippines (P. have anathematized "fixed period employment" or employment for a term. 1971.D. The Civil Code of the Philippines. Prior. it was the Code of Commerce (Article 302) which governed employment without a fixed period. which went into effect on November 1. as a "permanent employee. 1974. 1949 and became effective on August 30. The Code contained explicit references to fixed period employment. 442) had not yet been promulgated.1950." to his former position without loss of seniority rights and with full back wages. 1052. it was perfectly legitimate for them to include in it a stipulation fixing the duration thereof Stipulations for a term were explicitly recognized as valid by this Court. refused to give such clearance and instead required the reinstatement of Alegre. No prohibition against term-or fixed-period employment is contained in any of its articles or is otherwise deducible therefrom. 1787. R. obscuration of the principle of licitness of term employment began to take place at about this time. The employment contract between Brent School and Alegre was executed on July 18.accepting the recommendation of the Labor Conciliator. thereto. At that time.A. and also implicitly acknowledged the propriety of employment with a fixed period. ISSUE: Whether or not the provisions of the Labor Code. Outlawing the whole concept of term employment and subverting to boot the principle of freedom of contract to remedy the evil of employer's using it as a means to prevent their employees from obtaining security of tenure is like cutting off the nose to spite the face or. the foregoing articles regarding employment with "a definite period" and "regular" employment were amended by Presidential Decree No. 850. except where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee or where the work or service to be performed is seasonal in nature and the employment is for the duration of the season.Article 320 originally stated that the "termination of employment of probationary employees and those employed WITH A FIXED PERIOD shall be subject to such regulations as the Secretary of Labor may prescribe. No. As it is evident that Article 280 of the Labor Code. Article 320. Subsequently." was altered by eliminating the reference to persons "employed with a fixed period. but would also appear to restrict. April 26. not only fails to exhaust the gamut of employment contracts to which the lack of a fixed period would be an anomaly. curing a headache by lopping off the head. 57822. 1989) where. dealing with "Probationary and fixed period employment. in the fairly analogous case of a teacher being served by her . to preclude absurdity in its application." and was renumbered (becoming Article 271)." And Article 319 undertook to define "employment without a fixed period" in the following manner: …where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer. Office of the President (G." Article 321 prescribed the just causes for which an employer could terminate "an employment without a definite period. under a narrow and literal interpretation. Such interpretation puts the seal on Bibiso upon the effect of the expiry of an agreed period of employment as still good rule—a rule reaffirmed in the recent case of Escudero vs. effective December 16.R. it logically follows that such a literal interpretation should be eschewed or avoided. the right of an employee to freely stipulate with his employer the duration of his engagement. 1975. The law must be given a reasonable interpretation. without reasonable distinctions. more relevantly. It loses sight of the fact that her employment was probationary. nor an application for clearance to terminate which needed the approval of the Department of Labor to make the termination of his services effective. not denied. respondent Alegre's employment was terminated upon the expiration of his last contract with Brent School on July 16. not a letter of termination. 1976 without the necessity of any notice. In any case. and one with a definitive period. . It is not a letter of termination. At the expiration of the period stipulated in the contract. the Court held: Reyes (the teacher's) argument is not persuasive. Paraphrasing Escudero. her appointment was deemed terminated and the letter informing her of the non-renewal of her contract is not a condition sine qua non before Reyes may be deemed to have ceased in the employ of petitioner UST. such clearance should properly have been given. The notice is a mere reminder that Reyes' contract of employment was due to expire and that the contract would no longer be renewed. contractual in nature. The advance written advice given the Department of Labor with copy to said petitioner was a mere reminder of the impending expiration of his contract.school a notice of termination following the expiration of the last of three successive fixed-term employment contracts. respondents. No. and as a subsidiary. vs. 1991 PNOC-ENERGY DEVELOPMENT CORPORATION. a government owned or controlled corporation. it is also a GOCC and as such. PARAS. ISSUE: Whether or not PBOC-EDC is correct. Mercado then filed a complaint for illegal dismissal against PNOC-EDC. HELD: . NATIONAL LABOR RELATIONS COMMISSION (Third Division) and DANILO MERCADO. J. 79182 September 11.G. the proper forum for Mercado’s suit is the Civil Service Commission.R. FACTS: In June 1985. Danilo Mercado was dismissed by PNOC-Energy Development Corporation (PNOC-EDC) due to serious acts of dishonesty allegedly committed by Mercado. PNOC-EDC filed a motion to dismiss on the ground that the Labor arbiter and/or the National Labor Relations Commission (NLRC) has no jurisdiction over PNOC-EDC because it is a subsidiary of the Philippine National Oil Company (PNOC). petitioner. However. It is also true that under the 1973 Constitution. the provisions of the 1987 Constitution regarding the legal matters [procedural aspect] are applicable because it is the law in force at the time of the decision. subdivisions. PNOC-EDC. was incorporated under the general Corporation Law – it does not have its own charter. It is true that PNOC is a GOCC and that PNOC-EDC. . Section 2 ) Hence. being a subsidiary of PNOC. it is under the jurisdiction of the MOLE. (Article IX-B. Under this provision. is likewise a GOCC. the above provision sets the rule that the mere fact that a corporation is a GOCC does not automatically place it under the CSC.No. including government-owned or controlled corporations with original charters. Even though the facts of this case occurred while the 1973 Constitution was still in force. the test in determining whether a GOCC is subject to the Civil Service Law is the manner of its creation such that government corporations created by special charter are subject to its provisions while those incorporated under the general Corporation Law are not within its coverage. all GOCCs are under the jurisdiction of the CSC. In the case at bar. instrumentalities and agencies of the Government. even though it is a GOCC. the 1987 Constitution change all this as it now provides: The Civil Service embraces all branches. The issue in this case has been decided already in the case of PNOC-EDC vs Leogardo. hence. Minister Blas F.: FACTS: On March 15. KARGANILLA and LYDIA S. but with the requirement that the implementation thereof shall be instituted without prejudice to whatever benefits may have accrued in favor of the employees concerned. 1993 ABRAHAM B. Ople approved the RRR Program without any serious objection. ANASTACIO T. herein .G. NATIONAL LABOR RELATIONS COMMISSION. No. 1984. department heads and institute secretaries therein. ANA B. Mijares. the former president of respondent Gregorio Araneta University Foundation (GAUF). vs. sent a letter to the then Minister of Labor and Employment requesting approval of the Reorganization. YUSAY. 101013 February 2. MARVIN B. BLANCAFLOR. petitioners. LEONARDO DANTES. In the implementation of the RRR Program effective January 1. 2 Petitioners in the case at bar are regular members of the faculty of respondent university and were concurrently holding administrative positions as dean. VICENTE. Retrenchment and Restructuring (hereinafter referred to as RRR) Program of the GAUF on the ground of serious business losses and financial reverses being experienced by the university. 1 In a letter dated March 29. J. CALICA. Cesar A.R. 1983. GREGORIO ARANETA UNIVERSITY FOUNDATION and ILUMINADO G. MERCADO. VALENCIA. 1983. respondents. AGAIN. MARYLYN M. ROBERTO Z. REGALADO. petitioners were retired but subsequently rehired. When the contract specifies the period of its duration it terminates on the expiration of such period. which all expired on the same date. 1988. 4 Petitioners motion for reconsideration and related reliefs was denied in the resolution of the NLRC dated July 23. department heads and institute secretaries were for fixed terms of definite periods as shown by their respective contracts of employment. had been extended by private respondent from time to time until the expiration of their last appointment on May 31. Their appointment to their administrative positions as dean. respectively. principal. The alleged lack of notice of termination to petitioners is of no consequence. ISSUE: Whether the termination of Blancaflor is valid? RULING: Yes. reversing the labor arbiter's aforestated decision and dismissing petitioners' complaint for lack of merit. 1991. Herein petitioners voluntarily signed the appointments extended to them as attested by their signature over the word "conforme" in their contracts of employment. Petitioners herein were dismissed by reason of the expiration of their contracts of employment. 1991. it is the practice and policy of educational institutions that appointment to the positions of department heads and other high administrative offices are held by faculty members only on a temporary or non-permanent basis either within a specified term or at the pleasure of the school head or board of regents. there was no illegal dismissal. or administrative officer of one type or another. Petitioners' appointments as dean. As we observed in Brent. There is nothing whatever amiss in said practice of having teachers serve as administrative officials for a fixed term or in a non-permanent capacity in order to accord to as many of the teaching staff as possible the opportunity to serve as dean. Petitioners were lawfully terminated upon the expiration of their contracts with respondent without the necessity of any notice. Private respondent GAUF appealed the decision to the National Labor Relations Commission (NLRC) which rendered its decision dated May 24. department heads and institute secretaries. A contract for employment for a definite period terminates by its own . No. respondent Eloisa Fadriquela executed a Contract of Employment with the petitioner in which she was hired as a production operator with a daily salary of P118.R. 141717. 1992.4. Aside from contractual employees. that is. from January 4. however. The right of herein petitioners to claim the said benefits under the 1984 RRR Program of respondent university is unquestionably evident. telecommunications equipment and cars. G.0 for the period covered by the performance appraisal to maintain good standing as an employee. Line supervisor Shirley F. the contention of private respondents that petitioners are not entitled to the same.After the expiration of her third contract. since they were not separated. attendance and work attitude. Her contract was again renewed for two months or up to December 16. three absences in the month of May and four absences in the month of June. the petitioner employed 1. 1993 to June 4. 2004 Facts: The petitioner Philips Semiconductors (Phils. quality. 1993. from April 5. 1993 to April 4. RF modules. Velayo asked the respondent .term at the end of such period. After garnering a performance rating of 3. April 14. the respondent‘s contract was extended for another three months. 1993. incurred five absences in the month of April.029 regular workers. The employees were subjected to periodic performance appraisal based on output. Inc. that is. it was extended anew. It caters to domestic and foreign corporations that manufacture computers. 14 The general notice of termination given by respondent university to petitioners was a mere reminder that their contracts of employment were due to expire and that the contract would no longer be renewed. Fardiquela. One was required to obtain a performance rating of at least 3. for three months. On the claims of herein petitioners for separation or retirement pay by reason of the RRR Program of 1984. 1992.). RF and metal transistors and glass diods. She. CATV modules. is a domestic corporation engaged in the production and assembly of semiconductors such as power devices. when she received a performance rating of 3.8. Her initial contract was for a period of three months up to August 8. Philips Semiconductor vs. but was extended for two months when she garnered a performance rating of 3.15. 15 Further. it must be noted that after the employment contracts of herein petitioners as administrative officers expired. 1992. On May 8. is not well-taken. they were retained as faculty members by private respondent. Thus. The primary standard to determine a regular employment is the reasonable connection between the particular activity performed by the employee in relation to the business or trade of the employer. Hence. whether continuous or broken. Velayo recommended to the petitioner that the respondent‘s employment be terminated due to habitual absenteeism. the respondent‘s contract of employment was no longer renewed. The respondent still failed to respond. but the latter failed to explain her side. She was assigned to wire building at the transistor division. even if the performance is not continuous or merely intermittent.why she incurred the said absences. 1992 to June 4. and (2) those casual employees who have rendered at least one year of service. If the employee has been performing the job for at least one year. There is no dispute that the work of the respondent was necessary or desirable in the business or trade of the petitioner. Velayo would have no other recourse but to recommend the nonrenewal of her contract. Issues and Rulings: (a) whether or not the respondent was still a contractual employee of the petitioner as of June 4. but only with respect to such activity and while such activity exists. In this case.8. 1993. The respondent was warned that if she offered no valid justification for her absences. as a consequence of which her performance rating declined to 2. The test is whether the former is usually necessary or desirable in the usual business or trade of the employer. The law does not provide the qualification that the employee must first be issued a regular appointment or must be declared as such before he can acquire a regular employee status. if not indispensability of that activity to the business of the employer. the law deems the repeated and continuing need for its performance as sufficient evidence of the necessity. She remained under the employ of the petitioner without any interruption since May 8. The two kinds of regular employees under the law are (1) those engaged to perform activities which are necessary or desirable in the usual business or trade of the employer. with respect to the activities in which they are employed. in accordance with the Company Rules and Regulations. the employment is also considered regular. the respondent was employed by the petitioner on May 8. 1992 as production operator. 1993 or for one (1) year and twenty-eight (28) . We do agree that an employee may be dismissed for violation of reasonable regulations/rules promulgated by the employer. For. is too harsh a penalty. Where a penalty less punitive would suffice. if so. The original contract of employment had been extended or renewed for four times. with the same chores. the Constitution guarantees the right of workers to ―security of tenure. three (3) absences in May 1993 and four (4) absences in June 1993. whether or not she was accorded the requisite notice and investigation prior to her dismissal. the respondent had attained the regular status of her employment with the petitioner. the respondent‘s dismissal from employment for incurring five (5) absences in April 1993. to the same position. then. . Given the factual milieu in this case. whatever missteps may have been committed by the worker ought not to be visited with a consequence so severe such as dismissal from employment.‖ The misery and pain attendant to the loss of jobs then could be avoided if there be acceptance of the view that under certain circumstances of the case the workers should not be deprived of their means of livelihood. Such a continuing need for the services of the respondent is sufficient evidence of the necessity and indispensability of her services to the petitioner‘s business. Dismissal is the ultimate penalty that can be meted to an employee. even if true. we agree with the appellate court that the respondent was dismissed by the petitioner without the requisite notice and without any formal investigation.days. and On the second and third issues. By operation of law. and is thus entitled to security of tenure as provided for in Article 279 of the Labor Code which reads: (b) whether or not the petitioner dismissed the respondent from her employment. Stephanie G. Respondents asserted that . 178505. the HRAD Manager of INNODATA wrote petitioners informing them of their last day of work. 1999 to FEB. at the end of the close of business hours On February 16. Petitioners Cherry J. 2000 a period of ONE YEAR. et al. 2008 Facts: INNODATA had since ceased operations due to business losses in June 2002. On 22 May 2000.. stipulating that the contract shall be effective from FEB. 16. September 30. No. conversion and data processing company. Petitioners finally argued that they could not be considered project employees considering that their employment was not coterminous with any project or undertaking. The parties executed an employment contract denominated as a Contract of Employment for a Fixed Period. According to INNODATA. Petitioners claimed that they should be considered regular employees since their positions as formatters were necessary and desirable to the usual business of INNODATA as an encoding. Domingo.. 2000. and Lolita Arbilera were employed as formatters by INNODATA. 16. G. Price. petitioners employment already ceased due to the end of their contract. petitioners filed a Complaint for illegal dismissal and damages against respondents.R.Price. On 16 February 2000. the termination of which was predetermined. v Innodata Phils. The Labor Arbiter issued its Decision finding petitioners complaint for illegal dismissal and damages meritorious. the Court of Appeals promulgated its Decision sustaining the ruling of the NLRC that petitioners were not illegally dismissed. an employment shall be deemed to be regular where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer. for their employment was terminated due to the expiration of their terms of employment. and absolved INNODATA of the charge of illegal dismissal. The employment status of a person is defined and prescribed by law and not by what the parties say it should be. this petition. The provisions of written agreement to the contrary notwithstanding and regardless of the oral agreement of the parties. Respondent INNODATA appealed the Labor Arbiters Decision to the NLRC. provisions of applicable statutes are deemed written into the contract. and the parties are not at liberty to insulate themselves and their relationships from the impact of labor laws and regulations by simply contracting with each other. Hence. Issues: Whether petitioners were illegally dismissed by respondents Whether petitioners were hired by INNODATA under valid fixed-term employment contracts Ruling: The Court finds merit in the present Petition. 280.petitioners were not illegally dismissed. On 25 September 2006. as amended. The NLRC reversed the Labor Arbiters Decision dated 17 October 2000. except where the employment has been fixed for a . Regular employment has been defined by Article 280 of the Labor Code. There were no valid fixed-term contracts and petitioners were regular employees of the INNODATA who could not be dismissed except for just or authorized cause. Thus. Regular and Casual Employment. which reads: Art. Equally important to consider is that a contract of employment is impressed with public interest such that labor contracts must yield to the common good. specific project or undertaking the completion or termination of which has been determined at the time of engagement of the employee or where the work or services to be performed is seasonal in nature and employment is for the duration of the season. making it easier to understand for the clients and/or the intended end users thereof. An employment shall be deemed to be casual if it is not covered by the preceding paragraph. with respect to the activity in which they are employed. Based on the afore-quoted provision. the work performed by petitioners was necessary or desirable in the business or trade of INNODATA. any employee who has rendered at least one year of service. However. petitioners belong to the first type of regular employees. to those by nature seasonal or for specific projects with predetermined dates of completion. they also include . the applicable test to determine whether an employment should be considered regular or non-regular is the reasonable connection between the particular activity performed by the employee in relation to the usual business or trade of the employer. these do not necessarily result in regular employment under Article 280 of the Labor Code. whether such service is continuous or broken. petitioners were employed by INNODATA on 17 February 1999 as formatters. Formatting organizes the data encoded. That. the following employees are accorded regular status: (1) those who are engaged to perform activities which are necessary or desirable in the usual business or trade of the employer. Under the Civil Code. The primary business of INNODATA is data encoding. In the case at bar. Provided. regardless of the length of their employment. fixed-term employment contracts are not limited. Under Article 280 of the Labor Code. shall be considered a regular employee with respect to the activity in which he is employed and his employment shall continue while such activity exists. but have rendered at least one year of service. whether continuous or broken. Undoubtedly. Undeniably. as they are under the present Labor Code. it is also true that while certain forms of employment require the performance of usual or desirable functions and exceed one year. and (2) those who were initially hired as casual employees. and the formatting of the data entered into the computers is an essential part of the process of data encoding. which are by practice or tradition rotated among the faculty members. although it may not be known when." . college secretary. the concept of regular employment with all that it implies does not appear ever to have been applied. etc. despite the provisions of Article 280. The decisive determinant in term employment is the day certain agreed upon by the parties for the commencement and termination of their employment relationship. Article 280 of the Labor Code notwithstanding. Policy Instructions No. also appointments to the positions of dean. is necessarily implied. In Brent. to which. in providing that these officials. More importantly. it has consistently held that this is the exception rather than the general rule. the very same case invoked by respondents. principal.those to which the parties by free choice have assigned a specific date of termination. 8 of the Minister of Labor implicitly recognize that certain company officials may be elected for what would amount to fixed periods. because the stockholders or the board of directors for one reason or another did not reelect them. and where fixed terms are a necessity without which no reasonable rotation would be possible. a fixed-term employment is valid only under certain circumstances. to wit: Some familiar examples may be cited of employment contracts which may be neither for seasonal work nor for specific projects. whatever the nature of the engagement. for one. at the expiration of which they would have to stand down. "x x may lose their jobs as president. executive vice-president or vice president. Seasonal employment and employment for a particular project are instances of employment in which a period. Similarly. and other administrative offices in educational institutions. but to which a fixed term is an essential and natural appurtenance: overseas employment contracts. assistant dean. a day certain being understood to be that which must necessarily come. where not expressly set down. While this Court has recognized the validity of fixed-term employment contracts. the Court identified several circumstances wherein a fixed-term is an essential and natural appurtenance. with prior permission first obtained from his checker. J. vs. and CHENG SUY EH. On 5 April 1983 it employed petitioner with the specific task of operating the roller. is engaged in the manufacture of biscuits with private respondent Cheng Suy Eh as its General Manager. February 25. 122178. 1999] DANILO DIMABAYAO. Inc. cutting biscuits. No. BELLOSILLO. mashing flour and feeding the flour mass into its thinning machine. while petitioner was assigned to sort out rejects.R.: FACTS: DANILO DIMABAYAO seeks to set aside through this petition for certiorari under Rule 65 of the 1997 Rules of Civil Procedure the 15 March 1995 Decision and 23 June 1995 Resolution of the National Labor Relations Commission (NLRC) which modified the Decision of the Labor Arbiter finding private respondents guilty of having illegally dismissed petitioner from their employ. On 30 July 1992. NATIONAL LABOR RELATIONS COMMISSION. respondents. he went to the comfort room to . ISLAND BISCUIT INC. Private respondent Island Biscuit. sorting out rejects.[G.. petitioner.  Believing that this denial was enough he did not anymore submit any written explanation. Marcela Lok.answer the call of nature and relieve himself. Petitioner complied. respondent company's Personnel Manager. but because of the strained relationship between the parties. handed petitioner a letter asking him to explain in writing why he left his work station on 17 and 30 July 1992. His dismissal however was found illegal. Finding petitioner's explanation not satisfactory. 31 July 1992. afterwhich he returned to his work place. respondent company discourages its employees from going to the comfort room during working hours for sanitary or hygienic purposes as the company is engaged in the food business. The following day. respondent company through its Personnel Officer Marcela Lok served petitioner a notice of termination. On 21 September 1994 the Labor Arbiter declared the suspension of petitioner valid and legal not because he left his production area to relieve himself but for his utter disregard of the directive of the manager to submit his written explanation. Petitioner verbally explained that he never left his station on 17 July while on 30 July he only went to the comfort room for a short while to answer the call of nature. petitioner was suspended for fifteen (15) days which he contested before the Arbitration Branch of the NLRC. Petitioner thereafter amended his complaint before the NLRC to include illegal dismissal among his causes of action in view of his termination from the service. But private respondent Cheng Suy Eh was unhappy seeing petitioner away from his work station and immediately demanded from him a written explanation allegedly for abandoning his work. As a matter of policy. On 20 October 1992 petitioner requested a fellow worker to replace him in his work station so he could go to the comfort room to relieve himself. Again private respondent Cheng Suy Eh noticed petitioner's brief absence and so. the Labor Arbiter further held that reinstatement was no longer feasible and thereafter awarded petitioner a limited back wages for six (6) months without . his manager berated him again and required him to submit once more a written explanation for allegedly abandoning his work. upon his return. for his inability to submit a written explanation. But. and 10% attorney's fees of P3. 30 July and 20 October 1992 incidents. While it may be true that complainant has been leaving his work area without permission.reinstatement. RULING: No.00. separation pay of P14. without reference to any infraction committed before then. the infraction committed by the complainant is not so grave that would warrant the ultimate penalty of dismissal . Whether or not the complainant relieved himself is not the issue. opined that a grave injustice would be committed against the employee if the penalty imposed was grossly disproportionate to the wrong he committed.00. petitioner's dismissal was based merely on the 17 July.391.for not asking permission from his supervisor before answering a call of nature.632.132. in effect. Thus private respondents were in addition required to pay petitioner service incentive leave pay of P615. These offenses as enumerated in the NLRC decision were infractions imputed to petitioner prior to the 17 July. this Arbitration Board finds that complainant's habit of going to the toilet in the morning during production is merely a call of nature and by force of habit he had to relieve himself. The Labor Arbiter. At most. The call of nature is a reasonable reason for him to leave his work area. if that be considered an infraction at all! should have been sufficient penalty for petitioner. As such.60.00. . a 7-day suspension without pay . proportionate thirteenth month pay of P2. . as may be gleaned from the termination letter. The NLRC also endeavored to justify its decision by taking into account offenses allegedly committed by petitioner way back in 1990. Although complainant is not entirely without fault since he has been leaving his workplace without permission from his supervisor and his disrespect towards his superiors as borne out by the reports of his supervisor and guards. This only shows that the offenses attributed to petitioner before 17 July 1992 were mere afterthoughts . 30 July and 20 October 1992 alleged incidents. ISSUE: Whether or not the acts of Dimabayao constitute willful neglect of duties. they should have been outrightly ignored by the NLRC in determining and upholding the validity of petitioner's dismissal since. February 5. petitioner is entitled to reinstatement.R. and management was clearly on an impersonal level. The other petitioner. petitioners. No. Inc. COLE. Strained relationship may be invoked only against employees whose positions demand trust and confidence. Cole. denied petitioner procedural due process and deprived him of his right to be heard. Bascon had been employed as a nurse by respondent MCCH since May 1984. (MCCH) and members of the Nagkahiusang Mamumuo sa Metro Cebu Community Hospital (NAMA-MCCH). Petitioner Elizabeth C. As a consequence. obviously. Noemi V. To refer to those alleged earlier violations as further grounds for dismissal is undoubtedly prejudicial to petitioner. and GREGORIO IYOY. however. [G. 144899. petitioner himself was praying for his reinstatement. METRO CEBU COMMUNITY HOSPITAL. interestingly. a labor union of MCCH employees. vs. INC. respondents. BASCON and NOEMI V.: FACTS: The petitioners in the instant case were employees of private respondent Metro Cebu Community Hospital. thus barring reinstatement of petitioner. This. she already held the position of Head Nurse.. The postulate advanced by the Labor Arbiter that there existed "strained relationship" between the parties. But. does not hold water. At the time of her termination from employment in April 1996. to refute and present evidence to controvert such accusations prior to his actual dismissal from employment. QUISUMBING. Significantly. J. Petitioner did not occupy such a sensitive position as would require complete trust and confidence. had been working as a . the relationship between petitioner. and where personal ill will would foreclose his reinstatement. an ordinary employee. 2004] ELIZABETH C. it would also be doubly prejudicial to him to penalize him for those committed on 17 and 30 July 1992 as he was already suspended for fifteen (15) days for those infractions. In the instant case. or whose differences with their employer are of such nature or degree as to preclude reinstatement. HONORABLE COURT OF APPEALS.conceived in the course of the trial to further justify his dismissal. notices were served on all union members. They marched around the hospital putting up streamers. petitioners included. which was set to expire on December 31. Both petitioners were dismissed by the respondent hospital for allegedly participating in an illegal strike. MCCH notified the petitioners that they were to be investigated for their activities in the mass actions. Meanwhile. Said notice was. 1996. the Department of Labor and Employment (DOLE) office in Region 7 issued two (2) certifications stating that NAMAMCCH was not a registered labor organization. 1996. the members and officers of NAMA-MCCH staged a series of mass actions inside MCCH’s premises starting February 27. Petitioners. on March 28. The instant controversy arose from an intra-union conflict between the NAMA-MCCH and the National Labor Federation (NFL). denied receiving said notices. Mindful of the apparent intra-union dispute. the mother federation of NAMA-MCCH. did not deter NAMA-MCCH from filing a notice of strike with the Region 7 Office of the National Conciliation and Mediation Board (NCMB). 1996 and April 1. however. Consequently. In a notice dated April 8. the union members. including petitioners. placards and posters. MCCH decided to defer the CBA negotiations until there was a determination as to which of said unions had the right to negotiate a new CBA. the MCCH management received reports that petitioners participated in NAMA-MCCH’s mass actions. NAMA-MCCH asked MCCH to renew their Collective Bargaining Agreement (CBA). 1996. with the hearings being scheduled on March 28. 1996. 1995. however. Petitioners . In November 1995.nursing aide with MCCH since August 1974. opposed this move by its local affiliate. This finding. asking them to explain in writing why they were wearing red and black ribbons and roaming around the hospital with placards. explained that wearing armbands and putting up placards was their answer to MCCH’s illegal refusal to negotiate with NAMA-MCCH. On March 13 and 19. Subsequently. MCCH ordered petitioners to desist from participating in the mass actions conducted in the hospital premises with a warning that non-compliance therewith would result in the imposition of disciplinary measures. 1996. In their collective response dated March 18. disregarded by the NCMB for want of legal personality of the union. however. 1996. Believing that their union was the certified collective bargaining agent. NFL. however. the Court of Appeals found that petitioners’ actual participation in the illegal strike was limited to wearing armbands and putting up placards. they are within the mantle of constitutional protection under freedom of speech.again claimed they did not receive said order. while a union officer can be terminated for mere participation in an illegal strike. the real issue is whether or not petitioners were validly terminated for (1) allegedly participating in an illegal strike and/or (2) gross insubordination to the order to stop wearing armbands and putting up placards. 1996 and April 19. As to the first ground. 1996. . an ordinary striking employee. the acts of the did not constitute petitioners were terminated for allegedly participating in an illegal strike and gross insubordination to the order prohibiting them from wearing armbands and putting up placards. In this case. Thus. like petitioners herein. Substantial evidence. not for ipso facto failing to show up in the scheduled investigation. Petitioners Bascon and Cole were then served notices terminating their employment effective April 12. may suffice. which may justify the imposition of the penalty of dismissal. respectively. must have participated in the commission of illegal acts during the strike (underscoring supplied). In fact. But proof beyond reasonable doubt is not required. neither such wearing of armbands nor said putting up of placards can be construed as an illegal act. There was no finding that the armbands or the placards contained offensive words or symbols. There must be proof that they committed illegal acts during the strike. Article 264 (a) of the Labor Code provides in part that: …Any union officer who knowingly participates in 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… (Emphasis ours) Thus. ISSUE: Whether or not the acts of the Petitioners were just cause for their termination? RULING: No. Thus. per se. However.Evidence on record shows that various illegal acts were committed by unidentified union members in the course of the protracted mass action. that an ordinary union member must have knowingly participated in the commission of illegal acts during a strike. lawful. In this case. as a just cause for dismissal of an employee. patients. obviously solicitous of the welfare of the common worker. Thus. are legal per se and even constitutionally protected. we find lacking the element of willfulness characterized by a perverse mental attitude on the part of petitioners in disobeying their employer’s order as to warrant the ultimate penalty of dismissal. willful disobedience of the employer’s lawful orders. And we commiserate with MCCH. characterized by a wrongful and perverse attitude. . before termination may be considered. and (2) the order violated must have been reasonable. requires. envisages the concurrence of at least two requisites: (1) the employee's assailed conduct must have been willful. made known to the employee and must pertain to the duties which he had been engaged to discharge. Article 282 of the Labor Code provides in part: An employer may terminate an employment for any of the following causes: (a) Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or representative in connection with his work. MCCH could have done well to respect petitioners’ right to freedom of speech instead of threatening them with disciplinary action and eventually terminating them. Wearing armbands and putting up placards to express one’s views without violating the rights of third parties. and third parties for the damage they suffered. that is. As regards the appellate court’s finding that petitioners were justly terminated for gross insubordination or willful disobedience. But we cannot hold petitioners responsible for acts they did not commit. The law. August 9. No. while Helen was about to leave the company . 171115. 2003. It is a standard operating procedure of Keihin to subject all its employees to reasonable search before they leave the company premises.NAGKAKAISANG LAKAS NG MANGGAGAWA SA KEIHIN (NLMK-OLALIAKMU) and HELEN VALENZUELA vs. G.R. KEIHIN PHILIPPINES CORPORATION. a company engaged in the production of intake manifold and throttle body used in motor vehicles manufactured by Honda. 2010 FACTS: Petitioner Helen Valenzuela (Helen) was a production associate in respondent Keihin Philippines Corporation (Keihin). On September 5. Although Helen admitted that she took the packing tape. Respondent company also claimed that motive and value of the thing stolen are irrelevant in this case. The guard confiscated it and submitted an incident report dated September 5. she saw a packing tape near her work area and placed it inside her bag because it would be useful in her transfer of residence. of any company property or other associate’s property. Helen. maintained that Helen was guilty of serious misconduct because there was a deliberate act of stealing from the company. When the lady guard on duty inspected Helen’s bag. On September 26. 2003 to the Guard-in-Charge. They believed that the tape was not of great value and of no further use to respondent company since it was already half used. she found the packing tape inside her bag. petitioners claimed that her punishment was disproportionate to her infraction. petitioners filed a complaint against respondent for illegal dismissal. as well as moral and exemplary damages. admitted the offense and even manifested that she would accept whatever penalty would be imposed upon her. called her to his office and directed her to explain in writing why no disciplinary action should be taken against her. Helen received a notice of disciplinary action informing her that Keihin has decided to terminate her services. or any attempt to commit theft or robbery. in her explanation. in turn. 2003. 2003. Penalty: D (dismissal). She. Petitioners alleged that Helen’s act of taking the packing tape did not constitute serious misconduct. 2003. because the same was done with no malicious intent. who.premises. did not reckon that respondent company would terminate her services for her admitted offense.” Paul Cupon. with a prayer for reinstatement and payment of full backwages. or on September 6. The following day. respondent company issued a show cause notice to Helen accusing her of violating F. Keihin. however. on the other hand. .2 of the company’s Code of Conduct. submitted a memorandum regarding the incident to the Human Resources and Administration Department on the same date. Helen’s supervisor. “Any act constituting theft or robbery. On October 15. non-payment of 13th month pay. which says. especially an appeal by a worker who was terminated and whose livelihood depends on the speedy disposition of her case. It is “precisely ‘when an indispensable party is not before the court (that) an action should be dismissed. the CA rightly dismissed the petition based on a formal defect.” If there is a failure to implead an indispensable party.” The purpose of the rules on joinder of indispensable parties is a complete determination of all issues not only between the parties themselves. . while we affirm the CA’s dismissal of the petition for certiorari. A decision valid on its face cannot attain real finality where there is want of indispensable parties. Thus. At any rate. Rule 3 of the Rules of Court. they only indicated the name of the labor union Nagkakaisang Lakas ng Manggagawa sa Keihin (NLMK-OLALIA) as the party acting on behalf of Helen. Dismissal of appeals purely on technical grounds. but also as regards other persons who may be affected by the judgment. “parties in interest without whom no final determination can be had of an action shall be joined as plaintiffs or defendants.’ The absence of an indispensable party renders all subsequent actions of the court null and void for want of authority to act. any judgment rendered would have no effectiveness. we shall still discuss the substantive aspect of the case and go into the merits.ISSUE: Whether or not the dismissal of Helen was valid based on serious misconduct RULING: It is clear that petitioners failed to include the name of the dismissed employee Helen Valenzuela in the caption of their petition for certiorari filed with the CA as well as in the body of the said petition. Instead. Under Section 7. not only as to the absent parties but even to those present. is frowned upon. we are aware that it is the policy of courts to encourage full adjudication of the merits of an appeal. As a result. CALLEJO. March 31. MR heads and other computer storage devices for export. It is engaged in the manufacture of hard disc drives. respondents. Canlubang. Carmelray. Calamba. 158232. J..: FACTS: Petitioner Fujitsu Computer Products Corporation of the Philippines (FCPP) is a corporation organized and existing under Philippine laws with business address at the Special Export Processing Zone. vs. . Laguna. VICTOR DE GUZMAN and ANTHONY P.[G. ALVAREZ. 2005] FUJITSU COMPUTER PRODUCTS CORPORATION OF THE PHILIPPINES and ERNESTO ESPINOSA. No. petitioners. THE HONORABLE COURT OF APPEALS.R. SR. Respondent Victor de Guzman began working for FCPP on September 21, 1997 as Facilities Section Manager. As of 1999, he was also holding in a concurrent capacity the position of Coordinator ISO 14000 Secretariat and was receiving a monthly salary of P43,100.00 Respondent Allan Alvarez, on the other hand, was employed as a Senior Engineer on April 21, 1998. He was assigned at the Facilities Department under the supervision of respondent De Guzman, and was then earning P16,800.00. The garbage and scrap materials of FCPP were collected and bought by the Saro’s Trucking Services and Enterprises (Saro’s). On January 15, 1999, respondent De Guzman as Facilities Section Manager, for and in behalf of FCPP, signed a Garbage Collection Agreement with Saro’s, and the latter’s signatory therein was its owner and general manager, Larry Manaig. Sometime in the third week of July 1999, petitioner Ernesto Espinosa, HRD and General Affairs Director of FCPP, received a disturbing report from Manaig. Manaig reported that respondent De Guzman had caused the “anomalous disposal of steel [purlins] owned by FCPP.” Two of Manaig’s employees, Roberto Pumarez and Ma. Theresa S. Felipe, executed written statements detailing how respondent De Guzman had ordered the steel purlins to be brought out. ISSUE: Whether or not the acts of Victor De Guzman constitute serious misconduct? RULING: After a careful and painstaking study of the records of the case, the Court rules that the respondents’ dismissal from employment was not grounded on any of the just causes enumerated under Article 282 of the Labor Code. The term “trust and confidence” is restricted to managerial employees. In this case, it is undisputed that respondent De Guzman, as the Facilities Section Manager, occupied a position of responsibility, a position imbued with trust and confidence. Among others, it was his responsibility to see to it that the garbage and scrap materials of petitioner FCPP were adequately managed and disposed of. Thus, respondent De Guzman was entrusted with the duty of handling or taking care of the property of his employer, i.e., the steel purlins which the petitioners allege the respondent prematurely declared as scrap materials. However, to be valid ground for dismissal, loss of trust and confidence must be based on a willful breach of trust and founded on clearly established facts. A breach is willful if it is done intentionally, knowingly and purposely, without justifiable excuse, as distinguished from an act done carelessly, thoughtlessly, heedlessly, or inadvertently. It must rest on substantial grounds and not on the employer’s arbitrariness, whims, caprices or suspicion; otherwise, the employee would eternally remain at the mercy of the employer. Loss of confidence must not be indiscriminately used as a shield by the employer against a claim that the dismissal of an employee was arbitrary. And, in order to constitute a just cause for dismissal, the act complained of must be work-related and shows that the employee concerned is unfit to continue working for the employer. The Court had the occasion to reiterate in Nokom v. National Labor Relations Commission the guidelines for the application of the doctrine of loss of confidencea. loss of confidence should not be simulated; b. it should not be used as a subterfuge for causes which are improper, illegal or unjustified; c. it may not be arbitrarily asserted in the face of overwhelming evidence to the contrary; and d. it must be genuine, not a mere afterthought to justify earlier action taken in bad faith. In the case at bar, the grounds relied upon by petitioner FCPP in terminating the employment of respondent De Guzman are contained in the Inter-Office Memorandum dated August 23, 1999 which effectively terminated the latter’s employment: We have carefully evaluated your case and we are convinced that you have committed grave abuse of authority amounting to serious misconduct and willful breach of trust and confidence. Based on our findings, as supported by strong and competent evidences, and contrary to your explanation per your Letter dated July 26, 1999, the following facts were satisfactorily established: 1. That sometime in the first week of July 1999, you intimated to Mr. Roberto Pumarez, Supervisor of Saro’s Trucking Services, your intention to buy from Saro’s the metals which were then piled up and kept inside the Fuji Electric Philippines’ compound; 2. Thereafter, you ordered the metals to be sold to Saro’s Trucking Services so that you can buy them (metals) later from Saro’s at the price of P3.00 per kg., which price you yourself imposed on them; 3. However, it turned out later some pieces of metals which you have earlier declared as scraps and ordered to be sold to Saro’s were still to be used in the construction of FCPP’s Building B. Thus, on July 10, 1999, while Saro’s employees were initially loading the metals, an Engineer of SNK Philippines, Inc., FCPP’s building contractor, stopped them. It was only later after they were prevented from further loading the metals that you checked with the SNK personnel if the metals can already be disposed of as scraps which prove that you have prematurely declared the metals as scrap; 4. That through Mr. [Adrian] Camcaman, your subordinate Technician, you instructed the personnel of Saro’s to deliver the metals to Sta. Rosa Baptist Church, where you are an active Church member; 5. That, as of this date, you have not yet settled/paid your obligation to Saro’s. That immediately after you were placed under preventive suspension and to support your explanation that the transaction was between Saro’s and Sta. Rosa Baptist Church, you caused, through some people representing to be members of the Baptist Church and who are unknown to Saro’s, to issue a check in favor of Saro’s. When this failed, another person, representing to be a member of the Baptist church and who appeared for the first time, went to the office of Saro’s and tried to serve a letter addressed to Mr. Larry Manaig, Saro’s Proprietor, allegedly inquiring about the total obligation of the Baptist Church to Saro’s but, which was again not accepted as, in truth and in fact, there was really no transaction between Saro’s and the Sta. Rosa Baptist Church. All along, it was you and Mr. Camcaman who dealt directly with Saro’s. 6. That in previous occasions, it was reported by Mr. Manaig that you solicited from him empty drums, pails and corrugated cartons which were all part of those scraps picked up from FCPP and you never paid any of them, a fact which you never denied in your explanation which is tantamount to admission. Based on the foregoing, it is our well-discerned view that the transaction was exclusively limited between you and Saro’s. Except for your self-serving explanation, you failed miserably to present direct evidence that it was the Sta. Rosa Baptist church which bought the subject metals from Saro’s, as what you want us to believe. At best, your explanation is a mere afterthought desperately concocted to exculpate yourself. As Facilities Manager, a very sensitive and confidential position, the nature of your work demands of you that your actions should not be tainted with any suspicion or impropriety. However, you failed in this regard and abused your position to advance your self-interest. G.R. No. 166039 June 26, 2006 DIGITEL* TELECOMMUNICATIONS PHILIPPINES, INC., JOHNSON ROBERT L. GO** and ERIC J. SEVERINO,*** Petitioners, vs. MARIQUIT SORIANO, Respondent. CARPIO MORALES, J.: FACTS: Mariquit Soriano (Soriano) was hired as Director of Marketing by Digitel Telecommunications Philippines, Inc. (Digitel). Soriano worked under Vice President for Business Division Eric J. Severino (Severino) and Senior Executive Vice President Johnson Robert L. Go (Go). Following a professional dispute against Severino and Go, Soriano filed a resignation letter which was accepted by her superiors. Hence. reveals. who was never an employee nor present at the party of Digitel.After her resignation. thus amounting to constructive dismissal. appear incredible if not downright puny. She alleged that her superiors are preventing her former colleagues in testifying to the sexual harassment. due to professional and sexual harassment. conjectures. ISSUE: Whether or not the Soriano was forced to resign. Soriano filed a suit for illegal termination alleging that she was forced to resign due to professional and sexual harassment. As to the facts allegedly constituting “sexual harassment” advanced by Go and Severino. after an objective analysis over their assertions as stated in their respective counter-affidavits and further considering the other supporting documents attached to the respondents’ pleadings. She could not satisfactorily explain her allegation that she was consistently professionally harassed by respondent Severino. a Digitel . The Labor Arbiter held that Mariquit voluntarily resigned. the complainant could only venture to allege instances in general and vague terms. The latter’s alleged words: “How come you claim you know so much yet nothing ever gets done in your department?” do not jurisprudentially constitute nor clearly establish “professional harassment. In defense. The Court of Appeals reversed the decision of NLRC. She produced an affidavit by one of the persons involved with Digitel stating that the employees of the company were being forced not to testify against Go and Severino. the NLRC affirmed the findings of the Labor Arbiter. On appeal. thus dismissing the complaint.” Aside from these words. that she merely “concluded” that the employees of Digitel were instructed or harassed not to testify in favor of Soriano when they failed to meet one Matet Ruiz.this petition. although they are so detailed. and surmises. HELD: Soriano’s own allegation. An analysis of her statements shows that her own conclusion that she was being sexually and professionally harassed was on the basis of her own suppositions. however. it is found that these far out weigh the Soriano’s own evidence A reading of the affidavit of the witness. Go and Severino provided witnesses that testified that the acts alleged by Soriano din not happen. CORTEZ. J. No. 124617. 2000] PHILIPPINE AEOLUS AUTOMOTIVE UNITED CORPORATION and/or FRANCIS CHUA. her subordinates. April 28. be transferred to other departments. petitioner Francis Chua is its President while private respondent Rosalinda C. BELLOSILLO. we therefore have no doubt that complainant voluntarily resigned when respondent Severino refused to heed her demand that Ms. Cortez was a company nurse of petitioner corporation until her termination on 7 November 1994. We also have no doubt that such resignation does not constitute constructive dismissal. Inductivo.employee “who kept avoiding to meet with such tendency to threaten resignation every time higher management would refuse her demand to transfer subordinates who had administrative differences with her.R. Jlexj .: FACTS: Petitioner Philippine Aeolus Automotive United Corporation (PAAUC) is a corporation duly organized and existing under Philippine laws. respondents. vs. Arnedo and Ms. much less an illegal one. petitioners. NATIONAL LABOR RELATIONS COMMISSION and ROSALINDA C. [G. Jurismis Meanwhile. serious misconduct and fraud or willful breach of trust. She did not also submit the required explanation. (c) for asking a co-employee to punch-in her time card thus making it appear that she was in the office in the morning of 6 September 1994 when in fact she was not. (b) for losing the amount of P1. Fang of the CLMC Department on 23 August 1994. her superior. ISSUE: Whether or not Rosalinda Cortez was sexually harassed? RULING: . On 3 November 1994 a third memorandum was issued to private respondent. and uttering invectives against him on 2 August 1994.On 5 October 1994 a memorandum was issued by Ms. Lexjuris On 20 October 1994. private respondent submitted a written explanation with respect to the loss of the P1.488.00 and the punching-in of her time card by a coemployee. Personnel Manager of petitioner corporation.00 entrusted to her by Plant Manager Chua to be given to Mr. The memorandum however was refused by private respondent although it was read to her and discussed with her by a co-employee. On 21 October 1994 private respondent also refused to receive the second memorandum although it was read to her by a co-employee. Cortez requiring her to explain within forty-eight (48) hours why no disciplinary action should be taken against her (a) for throwing a stapler at Plant Manager William Chua. another memorandum was issued by petitioner corporation giving her seventy-two (72) hours to explain why no disciplinary action should be taken against her for allegedly failing to process the ATM applications of her nine (9) co-employees with the Allied Banking Corporation. while Cortez was still under preventive suspension. this time informing her of her termination from the service effective 7 November 1994 on grounds of gross and habitual neglect of duties. so that while her case was pending investigation the company placed her under preventive suspension for thirty (30) days effective 9 October 1994 to 7 November 1994. A copy of the memorandum was also sent by the Personnel Manager to private respondent at her last known address by registered mail.488. and. addressed to private respondent Rosalinda C. Myrna Palomares. scandal. Not many women. there is no time period within which he or she is expected to complain through the proper channels. moral damages "by way of example or correction for the public good" if the employer "acted in a wanton. by all tolerable means. he "found" the perfect reason to terminate her. Since he had no place in private respondent's heart. The gravamen of the offense in sexual harassment is not the violation of the employee's sexuality but the abuse of power by the employer. especially in this country. may rightfully cry "foul" provided the claim is well substantiated. so to speak. Strictly speaking. Exemplary damages. inter alia. If petitioner corporation had not issued the third memorandum that terminated the services of private respondent. harassed her. But William Chua faced reality soon enough. few persons are privileged indeed to transfer from one employer to another. reckless. Perhaps. are made of the stuff that can endure the agony and trauma of a public. for as long as she could outwit her employer's ploys she would continue on her job and consider them as mere occupational hazards. besmirched reputation and social humiliation by reason of the act complained of. if not bitterness. we could only speculate how much longer she would keep her silence. Moreover. the emotional threshold of the employee. we restate the bases therefor. Any employee. circumstances. on the other hand. and for finally venting her pent-up anger for years." . This uneasiness in her place of work thrived in an atmosphere of tolerance for four (4) years. so must she have no place in his office. Mseä sm In determining entitlement to moral and exemplary damages. and finally dislodged her. he provoked her. that beset her all that time. So. it suffices to prove that the claimant has suffered anxiety. In moral damages. to private respondent's mind. The dearth of quality employment has become a daily "monster" roaming the streets that one may not be expected to give up one's employment easily but to hang on to it. The time to do so may vary depending upon the needs. even corporate. oppressive or malevolent manner. are granted in addition to.We are not persuaded. sleepless nights. Esmsoâ Private respondent admittedly allowed four (4) years to pass before finally coming out with her employer's sexual impositions. and one could only imagine the prevailing anxiety and resentment. fraudulent. male or female. and more importantly. saying he will get something in her office.On the first working day in . he embraced her and kissed her.: Facts: On November 21. while respondent was on official leave. bringing giftsfor the three judges of the CTA. vs. No. J. Suddenly. he pulled her towards him andkissed her on her cheek. heentered her room and greeted her by shaking her hand. including respondent." Thereupon. 2000.M. SUSAN M.[A. HON. 2002] ATTY. SANDOVAL-GUTIERREZ. ACOSTA.. respondent. Shortly thereafter. shook her hand and greeted her. 2000. Presiding Judge. CTA-01-1. She wasable to free herself by slightly pushing him away. he entered her room.S. In the afternoon of the same day. Court of Tax Appeals. April 2.On December 28. "Merry Christmas. he called complainant by phone. ERNESTO D. complainant. she reported for work after her vacation in the U. AQUINO. Meantime. to accompany her. respondent called complainant andasked her to see him in his office to discuss the Senate bill on the CTA. pulled her towards him and kissed her. Education or Training .agent of the employer. Respondentseemed to be at a loss for words and kept glancing at Ruby who was searching for something atthe secretary's desk. “A mere casual buss on the cheek is not a sexual conduct or favor and does not fallwithin the purview of sexual harassment under R. sorry. complainant left crying and locked herself inside a comfortroom. respondent had left. he tried to grab her. a clerk in the Records Section. towit:'Sec.Weeks later. 2001. supervisor.January. it wonthappen again. respondent went to her office and tossed a note stating. respondent approached Ruby. Ruby said she found what she was looking for and left. manager. requesting her to go to hisoffice. Complainant instinctively raised her hands to protect herself but respondent held her arms tightly. She then asked Ruby Lanuza. Thereupon.The last incident happened the next day. Thereafter. At around 8:30 a. Forthwith.In the morning of February 14. employee. respondent sat on his chair and covered hisface with his hands. teacher. The latter agreed but suggested that they should act as if they met byaccident in respondents office. After that incident.Held: No. education or training-related sexual harassment is committed by an employer. When complainant arrived there. then slumped on a chair trembling. Respondent then approached complainant saying. respondent called complainant. me gusto akong gawin sa iyo kahapon pa. Ruby then approached the secretarys table which was separatedfrom respondents office by a transparent glass.Issue: Whether or not Judge Acosta is guilty of sexually harassment. when they reached his chambers.m. He is exonerated of the chargesagainst him and is advised to be more circumspect in his deportment. Section 3 (a) thereof provides.Fortunately.. She again requestedRuby to accompany her. When he returned. coach.having authority. respondent phoned complainant. instructor. Judge Acosta is not guilty of sexual harassment. complainant sat in front of respondent's table and asked him what he wanted to know about the Senate bill. 7877. influence or moral ascendancy over another in a work or training .A. after the Senate approved the proposed bill expanding the jurisdiction of the CTA.respondent tried to kiss her but she was able to evade his sexual attempt. Work. trainor.related Sexual Harassment Defined . She pushed himaway. 2001. For her part.while complainant and her companions were congratulating and kissing each other. asked her what she was looking for and stepped out of the office. or any other person who. . professor.Work. No. asking if she couldsee him in his chambers in order to discuss some matters. respondentsuddenly placed his arms around her shoulders and kissed her. 3. teacher. petitioner.2) The above acts would impair the employee's right or privileges under existing labor laws. or any other person having authority. Lourdes T. employee. influence or moral ascendancy exists in a working environment. NACHURA.A. DOMINGO. then Stenographic Reporter III at the NLRC. coach.: FACTS: On November 16. agent of the employer.”Indeed. Domingo (Domingo).a)In a workrelated or employment environment. segregating or classifying the employee which inanyway would discriminate. conditions. promotion or privileges specified under Section 3 of R. 2008 MA. filed a Complaint for sexual . 155831 February 18. demands. re-employment or continued employment of said individual. there is no showing that respondent judge demanded. influence or moral ascendancymakes a demand. supervisor.requested or required any sexual favor from complainant in exchange for favorablecompensation. the elements of sexual harassment are as follows:1)The employer. employee. promotions or privileges. supervisor. G. hostile. vs. Ma. 1998. from the records on hand.2)The authority. or offensive environment for theemployee. professor.or educationenvironment. instructor. requests or otherwise requires any sexual favor from the other.'"Clearly. professor. influence or moralascendancy over another. terms. 3) The employer. respondent. or any other person has authority. RAYALA. manager. request or requirement for submission is accepted by the object of saidAct. LOURDES T. trainor. terms. under the foregoing provisions.or 3) The above acts would result in an intimidating. deprive or diminish employment opportunities or otherwiseadversely affect said employees. conditions. or the refusal togrant sexual favor results in limiting. agent of the employer. J. sexual harassment is committed when:1)The sexual favor is made as a condition in the hiring or in the employment. coach. manager.R. request or requirement of a sexual favor. or in granting said individualfavorable compensation. regardlessof whether the demand. ROGELIO I. No. 7877. instructor. teacher. On May 8. .Likewise. but with the recommendation that the penalty should be suspension for six (6) months and one (1) day. Domingo filed a Petition for Review before the SC. According to Rayala. in accordance with AO 250. disagreeing with there commendation that respondent be meted only the penalty of suspension for six (6) months and one (1) day considering the circumstances of the case because of the nature of the position of Reyala as occupying the highest position in the NLRC. It was merely Domingo¶s perception of malice in his alleged acts ± a "product of her own imagination" that led her to file the sexual harassment complaint . as upheld by the CA. Rayala likewise filed a Petition for Review with this Court essentially arguing that he is not guilty of any act of sexual harassment. he assails the definition of the forms of sexual harassment: FORMS OFSEXUAL HARASSMENT Section 1.It was ordered that Rayala be dismissed from service for being found guilty of grave offense of disgraceful and immoral conduct.The committee constituted found Rayala guilty of the offense charged. the OP issued AO 119. Rayala next argues that AO 250 expands the acts proscribed in RA7877. or request from petitioner in exchange for her continued employment or for her promotion. Rayala assails the OP¶s interpretation. demand. Rayala filed Motions for Reconsideration until the case was finally referred to the Court of Appeals for appropriate action. Long digest by Ernani Tadili. He argues that sexual harassment is considered an offense against a particular person. The Republic then filed its own Petition for Review ISSUE: Whether or not there was sexual harassment? RULING: Rayala asserts that Domingo has failed to allege and establish any sexual favor. Secretary Laguesma submitted a copy of the Committee Report and Recommendation to the OP. not against society as a whole. 2000. that RA 7877 is malum prohibitum such that the defense of absence of malice is unavailing. being its Chairman.harassment against Rayala before Secretary Bienvenido Laguesma of the Department of Labor and Employment (DOLE). In particular. The CA found Reyala guilty and imposed the penalty of suspension of service for th emaximum period of one (1) year. the acts imputed to him are without malice or ulterior motive. petitioner. or requirement do not constitute sexual harassment as contemplated by the law.b) Unwelcome or improper gestures of affection. Belagan. SANDOVAL-GUTIERREZ. the Superintendent of DECS . disgusting or offensive to the victim.Forms of Sexual Harassment. respondent. vs.R. request. c) Request or demand for sexual favors including but not limited to going out on dates. J.: FACTS: 2 separate complaints for sexual harassment and various malfeasances were filed against Dr. 2004] CIVIL SERVICE COMMISSION. He posits that these acts alone without corresponding demand. 132164. Sexual harassment may be committed in any of the following forms: a) Overt sexual advances . He alleges that the rule-making power granted to the employer in Section 4(a) of RA 7877 is limited only to procedural matters. ALLYSON BELAGAN. or to come up with its own definition of sexual harassment. No. d) Any other act or conduct of a sexual nature or for purposes of sexual gratification which is generally annoying. [G. The law did not delegate to the employer the power to promulgate rules which would provide other or additional forms of sexual harassment. October 19. outings or the like for the same purpose. WON Magdalena is a credible witness WON Belegan is guilty of grave misconduct.” 2nd (LIGAYA ANNAWI): She alleged in her complaint that on four separate occasions. When she followed up her application.1st (MAGDALENA’s): She was applying for a permit to operate a pre -school and during the inspection of the pre-school. “she is not one whom any male would attempt to steal a kiss. YES. respondent touched her breasts. CSC: affirm DECS Sec but dismissed complaint of Ligaya. “Given her aggressiveness and propensity for trouble. her character being questionable. Rules on character evidence provision pertain only to criminal cases. Presented evidence against admin acts. not to administrative offenses. Transgression against Magdalena constitutes grave misconduct. Absolved of admin malfeasance and dereliction of duty. his organ pressing the lower part of her back. Magdalena was previously charged with 22 offenses before MTC Baguio and 23 complaints before brgy captains of Brgy Silang and Hillside in Baguio. HELD1. “Magdate muna tayo. Even if it is applicable to admin cases. DECS Sec: GUILTY of 4 counts of sexual “indignities or harassments” committed against Ligaya. Belagan placed his arms around her shoulders and kissed her cheeks. Magdalena is an unreliable witness. Belagan replied. only character evidence that would establish the probability or improbability of the offense charged may be proved. CA: dismissed Magdalena’s complaint. DISMISSED from service. DECS joint investigation: Belagan denied sexual harassment accusations.” ISSUE1. Character evidence must be limited to . and two (2)counts of “sexual advances or indignities” against Magdalena. kissed her cheek. touched her groins. embraced her from behind and pulled her close to him. reversed CSC Resolutions. physical injuries.” The general rule prevailing in a great majority of jurisdictions is that it is not permissible to show that a witness has been arrested or that he has been charged with or prosecuted for a criminal offense. malicious mischief. what is to be determined is the character or reputation of the person at the time of the trial and prior thereto. grave threats. QUISUMBING. unjust vexation. no evidence bearing on Magdalena’s chastity. filed against her. J. every person is capable to change or reform. 165565 July 14. (b)that innocent persons are often arrested or accused of a crime. etc. 2008 SCHOOL OF THE HOLY SPIRIT OF QUEZON CITY and/or SR. Regarding Magdalena’s credibility as a witness. but not at a period remote from the commencement of the suit. or confined in jail for the purpose of impairing his credibility.: . Certainly. the charges and complaints against her happened way back in the70s and 80s while the act complained of happened in 1994. TAGUIAM.the traits and characteristics involved in the type of offense charged. TOLENTINO.. Petitioners. This view has usually been based upon one or more of the following grounds or theories: (a) that a mere unproven charge against the witness does not logically tend to affect his credibility. In this case. CRISPINA A. In other words. thus. What were presented were charges for grave oral defamation. S. “It is unfair to presume that a person who has wandered from the path of moral righteousness can never retrace his steps again. vs.Sp.S.R. Evidence of one’s character or reputation must be confined to a time not too remote from the time in question. CORAZON P. G. Respondent. (c) that one accused of a crime is presumed to be innocent until his guilt is legally established. and (d) that a witness may not be impeached or discredited by evidence of particular acts of misconduct. No. the said charges are no longer reliable proofs of Magdalena’s character or reputation. The principal authorized the activity and allowed the pupils to use the swimming pool. Taguiam admitted that Chiara Mae Federico's permit form was unsigned. Taguiam was the Class Adviser of Grade 5-Esmeralda of the petitioner. Corazon P. the maintenance man was already administering cardiopulmonary resuscitation on Chiara Mae. Before the activity started. It evinces a thoughtless disregard of consequences without exerting any effort to avoid them. However. Under Article 282 of the Labor Code. Respondent went after them to verify where they were going. she concluded that Chiara Mae was allowed by her mother to join the activity since her mother personally brought her to the school with her packed lunch and swimsuit. two of them sneaked out. Issue: Was the dismissal based on the ground as stated valid? Ruling: Yes the dismissal was valid. First . Habitual neglect implies repeated failure to perform one's duties for a period of time. 2000. The child was still alive when respondent rushed her to the General Malvar Hospital where she was pronounced dead on arrival. Nevertheless. it is undisputed that Chiara Mae's permit form was unsigned. respondent allowed her to join the activity because she assumed that Chiara Mae's mother has allowed her to join it by personally . while respondent was away. the class president. Unfortunately. Chiara Mae drowned. School of the Holy Spirit of Quezon City. gross and habitual neglect of duties is a valid ground for an employer to terminate an employee. she warned the pupils who did not know how to swim to avoid the deeper area. while the pupils were swimming. Yet. respondent distributed the parent's/guardian's permit forms to the pupils. Respondent had been grossly negligent. or the entire absence of care. Gross negligence implies a want or absence of or a failure to exercise slight care or diligence. depending upon the circumstances. Taguiam was dismissed for gross negligence resulting to loss of confidence. In this connection. wrote a letter to the grade school principal requesting permission to hold a year-end celebration at the school grounds.Facts: Corazon P. On March 10. Corazon P. When she returned. petitioners lost its trust and confidence in respondent. Second. we observed that although the teller's infraction was not habitual. Loss of trust and confidence to be a valid ground for dismissal must be based on a willful breach of trust and founded on clearly established facts. without justifiable excuse. The deposit slip had already been validated prior to its loss and the amount reflected thereon is already considered as current liabilities in the bank's balance sheet. were present during their activity. was not habitual. Thus. respondent's negligence. it would be impossible for her by herself alone to keep an eye on each one of them. we ruled that Philippine Airlines (PAL) cannot be legally compelled to continue with the employment of a person admittedly guilty of gross negligence in the performance of his duties although it was his first offense. As a result of gross negligence in the present case. Respondent admitted that she was around when Chiara Mae and her mother arrived. Notably. National Labor Relations Commission. the cause is sufficient to dismiss respondent. In Philippine Airlines. Fuentes v. however. such as adequate first aid and sufficient adult personnel. A breach is willful if it is done intentionally. she should have coordinated with the school to ensure that proper safeguards. In another case. Indeed. re-booking. v. the damage went as far as claiming the life of a child. .bringing her to the school with her packed lunch and swimsuit. She should have been mindful of the fact that with the number of pupils involved. Inc. the sufficiency of the evidence as well as the resultant damage to the employer should be considered in the dismissal of the employee. a substantial amount of money was lost. The purpose of a permit form is precisely to ensure that the parents have allowed their child to join the school activity involved. Respondent cannot simply ignore this by resorting to assumptions. although gross. In this case. This is not the first time that the SC have departed from the requirements laid down by the law that neglect of duties must be both gross and habitual. we held that it would be unfair to compel Philippine Banking Corporation to continue employing its bank teller. and payment of special landing fees not to mention the soaring costs of replacing aircraft parts. She could have requested the mother to sign the permit form before she left the school or at least called her up to obtain her conformity. In that case. the possibility of law suits. In that case. NLRC. In view of the considerable resultant damage. knowingly and purposely. it was respondent's responsibility as Class Adviser to supervise her class in all activities sanctioned by the school. we noted that a mere delay on PAL's flight schedule due to aircraft damage entails problems like hotel accommodations for its passengers. No. there being a clear showing that respondent was culpable for gross negligence resulting to loss of trust and confidence.R. caprices or suspicion. her dismissal was valid and legal. heedlessly or inadvertently.as distinguished from an act done carelessly. it must rest on substantial grounds and not on the employer's arbitrariness. All told. 1991 PHILIPPINE AIRLINES. There must. vs. be an actual breach of duty committed by the employee which must be established by substantial evidence. the employee would eternally remain at the mercy of the employer. It has never been intended to afford an occasion for abuse because of its subjective nature. petitioner. otherwise. illegal or unjustified. It should be genuine and not simulated. whims. Otherwise stated. nor should it appear as a mere afterthought to justify earlier action taken in bad faith or a subterfuge for causes which are improper. 82471 February 18. INC. .. thoughtlessly. G. therefore. NATIONAL LABOR RELATIONS COMMISSION, NATHANIEL PINUELA and PHILIPPINE AIRLINES EMPLOYEES ASSOCIATION, respondents. FERNAN, C.J.:p FACTS: Private respondent Nathaniel Pinuela was ground equipment and tug operator of petitioner Philippine Air Lines (PAL), responsible for towing aircraft from the hangar to the ramp area and vice-versa. In line with his function, he held a professional driver's license and an operator's permit issued by PAL after he had passed corresponding theoretical and practical tests to operate PAL vehicles used for towing aircraft. He was already five (5) years in this particular line of work when the incident in question arose. On May 31, 1985, Pinuela was assigned as a member of the group tasked to park and position the Boeing 747 aircraft registered as N-745 at the Manila International Airport (now Ninoy Aquino International Airport, [NAIA]) for a flight to the United States. The group members and their respective assignments were: Pinuela –– tow tug operator, Rolando Manalaysay –– leadman and wingtip guide; Rodrigo Camina-headsetman; Arturo Balagat –– breakman, and a certain Tañada –– guide. The head of the group in charge of the parking/positioning of said aircraft was Nolie Domingo. On or about 12:55 in the afternoon, the aircraft was towed from the PAL technical center to Bay 16 area at the NAIA. While the Boeing 747 was being towed, the airplane collided with the bridge at Bay 16 causing damage to the plane's left landing light and the left wing flop and scratching its No. 2 engine. Consequently, on June 1, 1985, Pinuela was placed under preventive suspension and was charged administratively. After investigation by the PAL Administrative Board, he was dismissed from the service effective July 1, 1985. Thereafter, Pinuela filed a complaint for illegal dismissal and unfair labor practice against PAL. On July 21, 1987, the Labor Arbiter ruled in favor of Pinuela and ordered PAL to reinstate him to his former position without loss of seniority rights with full backwages until actual reinstatement. 1 On appeal, the National Labor Relations Commission (NLRC) on January 29, 1988 affirmed the decision of the Labor Arbiter but limited the award of backwages to two (2) years only. 2 The Labor Tribunal opined that "Pinuela could not be blamed for the accident as he relied on the signal of the headsetman (Camina) who still signaled to him despite the fact that the nose of the aircraft being towed was about to overshoot the yellow line and the aircraft wing was about to hit the airbridge." 3 Hence, this recourse, the issue being whether or not the NLRC gravely abused its discretion in appreciating the facts of the case. Petitioner PAL contends that the records do not reveal that a tow operator can rely only on a headsetman. According to the Engineering Manual of petitioner, a tug operator must tipguide positive visual contact with the wing tipguide when towing aircraft in congested areas. Thus, PAL avers that Pinuela should have relied on the signal of Manalaysay, then wing tipguide, and not on Camina, the headsetman. ISSUE: Whether or not the acts of Nathaniel Pinuela constitute gross and habitual neglect of duties RULING: One must admit that towing an aircraft is a group activity necessitating group coordination. This is explicit in petitioner's Engineering and Maintenance Manual which states, "that the tug operator must undertake and/or continue on towing/pushing procedure only when positive visual contact with all guidemen is possible." The use of, "all necessary guidemen" indicates plurality or group coordination. Thus, instead of relying solely on the signals of Camina, Pinuela should have also checked with the other ground crew personnel. Particularly, Pinuela should have relied on Manalaysay, Exhibit 2 distinctly shows the relative position of the plane, ground crew personnel and the airport's aerobridge when the incident happened. Manalaysay, who was near the marked line and the nearest obstruction which was the aerobridge and the parked service vehicle, was strategically located. For Pinuela to claim that he relied on Camina for signals is not credible, for he demonstrated before the Labor Arbiter that he had to turn 180 degrees to see Camina who was directly at his back. 9 In contradiction to the Labor Arbiter's opinion that petitioner's stance is weak because PAL failed to tipguide normal towing speed, we say that there is no necessity of determining the exact numerical towing speed. From daily operations, we can safely assume that the ground crew knows what "creeping" speed means. Through their working experience, they must certainly have gained a sufficient degree of competence to determine whether a Boeing 747, weighing tons, was being towed beyond normal speed or not. Indeed, the Labor Arbiter acted with grave abuse of discretion in ignoring this vital piece of evidence for the petitioner. Pinuela's act of towing beyond normal speed, his failure to observe proper parking procedure as provided in the Engineering and Maintenance Manual, and the unanimous statement of the members of the towing crew that he completely disregarded their warning shouts indicate that Pinuela is grossly negligent of his responsibilities as a tug operator. Pinuela's dismissal must therefore follow for a company has the right to dismiss its erring employees if only as a measure of self-protection against acts inimical to its interest. 10 Philippine Airlines, as employer, cannot be legally compelled to continue with the employment of a person admittedly guilty of gross negligence in the performance of his duties. 11 Lastly, Pinuela should not compare the penalty of dismissal imposed on him in relation to lesser sanctions previously meted by PAL on its other employees. We are solely concerned here with the sufficiency of the evidence surrounding Pinuela's dismissal. Besides, Pinuela's examples do not involve a plane with a scheduled flight. A mere delay on petitioner's flight schedule due to aircraft damage entails problems like hotel accommodations for its passengers, re-booking, the possibility of law suits, and payment of special landing fees not to mention the soaring costs of replacing aircraft. parts. All told, Pinuela's gross negligence which called for dismissal is evident and it was grave abuse of discretion on the part of the labor tribunal to have ruled otherwise. G.R. No. 75955 October 28, 1988 MARIA LINDA FUENTES, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION (NLRC), PHILIPPINE BANKING CORPORATION and JOSE LAUREL IV, as its President, respondents. FERNAN, C.J.: FACTS: Petitioner was employed as a teller at the Philbanking's office at Ayala Avenue, Makati, Metro Manila. On May 28, 1982, at about 10:30 a.m., petitioner, who was acting as an overnight teller, received a cash deposit of P200,000.00. She counted the money with the assistance of a co-teller, finishing the task at 10:40 a.m. or ten (10) minutes after her closing time. Before she could start balancing her transactions, the Chief Teller handed her several payroll checks for validation. Finding the checks to be incomplete, petitioner left her cage to get other checks, without, however, bothering to put the P200,000.00 cash on her counter inside her drawer. When she returned to her cubicle after three (3) to five (5) minutes, she found that the checks for validation were still lacking, so she went out of her cubicle again to get the rest of the checks. On her way to a co-teller's cubicle, she noticed that the P200,000.00 pile on her counter had been re-arranged. She thus returned to her cage, counted the money and discovered that one (1) big bundle worth P50,000.00 was missing therefrom. She immediately asked her co-teller about it and getting a negative reply, she reported the matter to the Chief Teller. A search for the P50,000.00 having proved unavailing, petitioner was asked to explain why she should not be held liable for the loss. She submitted her explanation on June 24, 1982. Subsequently, on June 3, 1983, petitioner was dismissed for gross negligence. On June 21, 1983, she filed a complaint for illegal dismissal with reinstatement and backwages. Private respondent bank seasonably filed an answer with counterclaim that petitioner be ordered to restitute the amount of P50,000. ISSUE: Whether or not the dismissal of Fuentes on the ground of gross and habitual neglect of duties valid? Regardless of whether there was a failure to investigate. the bank's inaction merely created a condition under which the loss was sustained. her responsibility over the cash entrusted to her remained. the petitioner's position is anathema to banking operations. . Besides.000 in his possession would be a likely suspect.00 had already been validated prior to the loss. the bank had already assumed the deposit as a liability to its depositors. management holds suspect each depositor within its premises. Petitioner argues further that the NLRC failed to consider that petitioner left her cage at the instance of the Chief Teller. Again we are not persuaded. the act of depositing had already been complete and from thereon. any innocent depositor with P50. By conducting an instant search on its depositors for every loss that occurs. Ultimately it will result in the loss of valued depositors. Considering that currency in the form of money bills bears no distinct earmarks which would distinguish it from other similar bills of similar denominations except as to its serial numbers. irrespective of who summoned her.000. Although petitioner's infraction was not habitual. Petitioner left at her own volition to approach her Chief Teller to ask for the remaining checks to ascertain their authenticity and completeness. Such act would do violence to the fiduciary relationship between a bank and its depositors.RULING: In the case at bar. the fact is that the money was lost in the first place due to petitioner's gross negligence. we took into account the substantial amount lost. Cash deposits are not assets to banks but are recognized as current liabilities in its balance sheet. Since the deposit slip for P200. The findings of the NLRC are clear. Besides. Such gross negligence was the immediate and determining factor in the loss. he received another letter. is a ground for termination of employment.. this time informing him that his employment in the company was to be terminated effective June 23. the respondent alleged..: FACTS: On July 18. On June 13. Except for the plane fare which the petitioner paid prior to his departure. Nineteen (19) years later. J. vs. as a company policy. the respondent received a letter2 dated June 3. 1975." Claiming that his dismissal was without just cause. the respondent. 1994. filed a complaint for illegal dismissal before the National Labor Relations Commission (NLRC). The respondent contended that his absences were justified. 2004 PROCTER AND GAMBLE PHILIPPINES. Inc.R. respondent Edgardo Bondesto started work in the employ of petitioner Procter and Gamble Philippines. the events which preceded the respondent’s dismissal from work unfolded. asking him to explain why his absences consisting of 35 days3 should not be classified as "unauthorized absence. No. both dated June 16.G." Unauthorized absence. TINGA. represented by the United Employees Union of Procter and Gamble Phils. Manila. Sometime in November 1993. 1994. petitioner. he was working as production technician at the company’s Tondo Plant in Tondo.4 The respondent presented his explanation in two (2) separate letters5. 1994. 1994 on the ground of "unauthorized absences. 1994. However. 139847 March 5. on June 22. At that time. the petitioner directed him to go to Mindanao for field assignment. One of the petitioner’s Staff District Managers issued a check in the amount of Ten . respondent. Inc. the respondent advanced all the other work-related expenses incurred during the assignment. EDGARDO BONDESTO. On January 31. or on April 13. He immediately worked on the reimbursement of his advances. "Misconduct" has been defined as "the transgression of some established . He claimed that the seventeen (17) days should be considered as compensable working time since he was then at the Makati office working on the reimbursement of his money. the failure to locate the physician cannot amount to "serious misconduct or willful disobedience. The delay in the release of his reimbursement even forced him to apply for wage advances under the collective bargaining agreement between the company and the union. ISSUE: Whether or not habitual absences constitute gross and habitual neglect of duties RULING The Court agrees. however. included the days he worked on his reimbursements. 1994. One week later. 1994. And as he needed money. the petitioner finally released the respondent’s reimbursements. he was constrained to go to the petitioner’s General Office located in Makati to follow-up the reimbursement. but it bounced after he presented it to the bank. the respondent was re-assigned in Manila. or after more than two months. he also went to the company’s Makati office to follow-up the reimbursement process. which according to him. He spent time attending to them. But as the reimbursements were not immediately released. with the petitioner that the respondent failed to justify his prolonged absences during the months of May to June.000. he regrettably failed to show that he exerted any effort to locate his physician. the respondent received a letter asking him to explain his "excessive absences"7. Meanwhile.Thousand Pesos (P10." as the petitioner would like this Court to believe. The respondent demurred. Nevertheless. On April 6. While his intention to go back to work was manifest. the children of the respondent became sick. 1994.00) supposedly to cover respondent’s traveling expenses. "22 On the other hand. In sum. While the Court recognizes the rights of an employer to terminate the services of an employee for a just or authorized cause. a dereliction of duty. dismissal is too harsh a sanction." and the order violated must have been reasonable. The petitioner claims that the existence of strained relationship between the parties militates against the reinstatement of the respondent. made known to the employee and must pertain to the duties which he had been engaged to discharge. the respondent had worked with the petitioner for nineteen (19) years. the dismissal of an employee must be made within the parameters of law and pursuant to the tenets of equity and fair play. The normal consequences of illegal dismissal are reinstatement without loss of seniority rights and the payment of back wages computed from the time the employee’s compensation was withheld from him. There must be a reasonable proportionality between the offense and the penalty. Truly. and implies wrongful intent and not mere error in judgment. "willful disobedience" envisages the concurrence of at least two (2) requisites: the employee’s assailed conduct has been willful or intentional. Undoubtedly. in view of the Court’s finding that some of the respondent’s absences were not wholly justified. lawful. Not every case of insubordination or willful disobedience by an employee reasonably deserves the penalty of dismissal. a forbidden act. Even assuming that the respondent’s absenteeism constitutes willful disobedience. This command the Court has to heed and cannot disregard.and definite rule of action.The Constitution mandates the protection of labor. At the time of the filing of the complaint. the Court is convinced that the respondent has been illegally terminated from employment. such offense does not warrant the respondent’s dismissal. While the . the Court agrees with the NLRC and the Court of Appeals that backwages should be limited to one (1) year. the employer’s power to discipline its workers may not be exercised in such an arbitrary manner as to erode the constitutional guarantee of security of tenure. However. Dismissal has always been regarded as the ultimate penalty. the willfulness being characterized by a "wrongful and perverse attitude. willful in character. It has not been shown that the respondent committed any infraction of company rules during his two (2) – decade stint in the company. a certain degree of hostility as a result of litigation. more specifically. On appeal. As aptly put by the Court of Appeals. No. She declared that she did not file the adequate leave of absence because a medical certificate was already sufficient per company policy. Respondent’s rule penalizing with discharge any employee incurring six (6) or more absences without permission or subsequent justification is admittedly within the .Court agrees that human nature engenders. reinstatement would thus become the exception rather than the rule in cases of illegal dismissal. On 17 September 1994. V." [G. The respondent filed a case for illegal dismissal. for violating the Absence Without Official Leave Rule.R. The Labor Arbiter dismissed the complaint. both the NLRC and the CA declared the dismissal of complainant as illegal for being contrary to Art. in the normal course of things. 2007] DEL MONTE PHILIPPINES. ISSUE: Whether the absences of the respondent constitute gross and habitual neglect of duties Held: The Court affirmed the ruling of the Court of Appeals. LOLITA VELASCO Facts: Respondent was a regular employee of petitioner. asserting that her dismissal was illegal because she was suffering from a urinary tract infection related to her pregnancy and that her doctor had advised her to stay home for a few days. prohibiting the discharge of a woman on account of her pregnancy. Del Monte Philippines. 153477 : July 04. a notice of hearing was sent to respondent notifying her of the charges filed against her by the company. "if petitioner’s contention should be sustained. the strained relations are not necessarily sufficient to rule out reinstatement. INC. 137 (2) of the Labor Code. She was subsequently dismissed. ) To discharge such woman on account of her pregnancy. a prohibited act. vs. Atermination letter followed the next day. Issue: Whether Galera is an Employee or a Corporate Officer. No. while on leave or in confinement due to her pregnancy. 169207. On December 14. service incentive leave pay. that the respondent attempted to file leaves of absence but the petitioner’s supervisor refused to received them. actual and moral damages. a corporation based in Hong Kong.R. an American citizen who was recruited from the US by private respondent John Steedman. 2010 Facts: Petitioner is Jocelyn Galera. et al. Mark Webster (Webster) and Nominada Lansang (Lansang). G. x x x.. that the fact of pregnancy and its related illnesses had been duly proven through substantial evidence. (WPP). that she could not have filed prior leaves due to her continuing condition. On 3 January 2001. Inc. respondent was able to subsequently justify her absences in accordance with company rules and policy: that she was pregnant at the time she incurred the absences. and attorney's fees against WPP and/or John Steedman (Steedman).” WPP Marketing Communications Inc. Galera filed a complaint for illegal dismissal. Co.purview of the labor standard. and that petitioner dismissed the respondent on account of her pregnancy. Galera.. Chairman-WPP Worldwide and Chief Executive Officer of Mindshare. The Labor Arbiter's Ruling for illegal dismissal and damages in favor of GALERA. China. incentive plan. The First Division of the NLRC reversed the ruling of Arbiter Madriaga. 13th month pay.. while it is not disputed that complainant incurred absences exceeding 6 days. Whether WPP illegally dismissed Galera. Yet it was reversed again by CA. to work in the Philippines for private respondent WPP Marketing Communications. GALERA alleged she was verbally notified by private STEEDMAN that her services had been terminated from private respondent WPP. March 25. Art. holiday pay. 137 of the Labor Code provides: “It shall be unlawful for any employer: x x x (2. 2000. However. Ruling: . In your role as Managing Director. In both cases. We agree with Galera. Most of the staff I spoke with felt they got more guidance and direction from Minda than yourself. that is just not acceptable. Another indicator that she was a regular employee and not a corporate officer is Section 14 of the contract. I believe your priorities are mismanaged. those involved sort (sic) Minda's input. on the belief that she is an employee. As I discussed with you back in July. Corporate officers are given such character either by the Corporation Code or by the corporation's by-laws. Steedman. This implies that she was not under the disciplinary control of private respondent WPP's Board of Directors (BOD). hence. There is lack of leadership and confidence in your abilities from within. Galera. Webster and Lansang contend that Galera is a corporate officer. which states that her right of redress is through Mindshare's Chief Executive Officer for the Asia-Pacific. which should have been the case if in fact she was a corporate officer because only the Board of Directors could appoint and terminate such a corporate officer. which clearly states that she is a permanent employee — not a Vice-President or a member of the Board of Directors.Employee. You failed to lead and advise on the two new business pitches. which was also part of my directive that you needed to . WPP's dismissal of Galera lacked both substantive and procedural due process. At the time of Galera's appointment. Galera's appointment as a corporate officer (Vice-President with the operational title of Managing Director of Mindshare) during a special meeting of WPP's Board of Directors is an appointment to a non-existent corporate office. filed her complaint before the Labor Arbiter. Steedman's letter to Galera reads: The operations are currently in a shamble. The recent situation where you felt an internal strategy meeting was more important than a new business pitch is a good example. any controversy regarding her dismissal is under the jurisdiction of the Regional Trial Court. WPP. Apart from Steedman's letter dated 15 December 2000 to Galera. The quality output is still not to an acceptable standard. our agency partners and some clients. Another convincing indication that she was only a regular employee and not a corporate officer is the disciplinary procedure. my directive was for you to lead and review all business pitches. On the other hand. WPP already had one Vice-President in the person of Webster and all five directorship positions provided in the by-laws are already occupied. It is obvious [that] confusion existed internally right up until the day of the pitch. WPP failed to prove any just or authorized cause for Galera's dismissal. focus on back in July. I do not believe you understand the basic skills and industry knowledge required to run a media special operation. WPP, Steedman, Webster, and Lansang, however, failed to substantiate the allegations in Steedman's letter. Galera, on the other hand, presented documentary evidence 22 in the form of congratulatory letters, including one from Steedman, which contents are diametrically opposed to the 15 December 2000 letter. The law further requires that the employer must furnish the worker sought to be dismissed with two written notices before termination of employment can be legally effected: (1) notice which apprises the employee of the particular acts or omissions for which his dismissal is sought; and (2) the subsequent notice which informs the employee of the employer's decision to dismiss him. Failure to comply with the requirements taints the dismissal with illegality. 23 WPP's acts clearly show that Galera's dismissal did not comply with the two-notice rule. ARSENIO S. QUIAMBAO, vs.MANILA ELECTRIC COMPANY G.R. No. 171023 December 18, 2009 FACTS: Petitioner was employed as branch teller by respondent Manila Electric Company-Mandaluyong Office for the handling and processing of payments. Petitioner has repeatedly violated the Company Code of Employee Discipline specifically excessive unauthorized absences. Through a Notice of Dismissal, petitioner’s employment was terminated effective March 29, 2000. On July 3, 2001, petitioner filed a complaint before the Arbitration Branch of the NLRC against respondent assailing the legality of his dismissal. He also claimed that he was denied due process. The Labor Arbiter dismissed the complaint for a lack of merit. Petitioner appealed to the NLRC which affirmed the legality of his dismissal due to habitual absenteeism. On appeal to the Court of Appeals, the CA nullified the NLRC’s Decision and reinstated the Labor Arbiter’s Decision dismissing the complaint. It ruled that the award of separation pay is neither justified nor warranted under the circumstances The Motion for Reconsideration was denied, hence this petition for review on certiorari. ISSUE: Whether or not a validly dismissed employee may be entitled to separation pay. RULING: The Supreme Court DENIED petition for lack of merit. The Labor Arbiter, the NLRC and the Court of Appeals found that petitioner’s unauthorized absences and repeated infractions of company rules on employee discipline manifest gross and habitual neglect of duty that merited the imposition of the supreme penalty of dismissal from work. Serious misconduct is said to be a transgression of some established and definite rule of action, a forbidden act, a dereliction of duty, willful in character, and indicative of wrongful intent and not mere error of judgment. Oddly, petitioner never advanced any valid reason to justify his absences. Following jurisprudence, it is held that a series of irregularities when put together may constitute serious misconduct. Hence, the petitioner is not entitled to separation pay. The liberality of the law can never be extended to the unworthy and undeserving. G.R. No. 112206 December 11, 1995 GONZALO D. LABUDAHON, KAPATIRANG ANAK-PAWIS SA PIONEER TEXTURIZING, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION, PIONEER TEXTURIZING CORPORATION, and MR. JULIANO LIM, respondents. PADILLA, J.: FACTS: On 27 April 1990, petitioner applied for a 13-day paternity leave, but respondent company allowed him only five (5) days of leave effective on 30 April 1990 and until 5 May 1990 because of lack of manpower at the Texturizing Preparatory Section. From 7 May 1990 to 12 May 1990, petitioner absented himself from work without respondent company's approval. On 11 May 1990, Venus Dy, the personnel manager of respondent company, wrote petitioner a letter directing him to report to work lest his absences be considered as abandonment of duty. On 12 May 1990, petitioner asked for two (2) weeks of vacation leave from 7 May to 20 May 1990, but the same was disapproved except for two (2) days of leave on 14 and 15 of May 1990 to enable petitioner to attend to family problems. Petitioner did not report for work from 16 to 19 of May 1990. Upon orders of respondent company, petitioner submitted a written explanation citing his wife's childbirth and family problems as reasons for his absences. Petitioner was meted five (5) days suspension for unexcused absences and for insubordination. In spite of his previous absences, petitioner, as union officer, asked for fiftyfour (54) days of leave from 9 July 1990 to 31 August 1990 to prepare for CBA negotiations and union activities. The request was denied and instead the management advised petitioner to file his leave on a weekly basis, as approval thereof was contingent on the necessity of his presence in the operations of the Texturizing Department of respondent company. Petitioner completely ignored this directive and absented himself from work starting 21 July 1990 until 16 August 1990. In a memorandum of the personnel department dated 3 August 1990, petitioner was asked to submit a written explanation for his absences. Respondent company never received any letter of explanation. In a memorandum dated 28 August 1990, the company, through its personnel manager, terminated petitioner's services to take effect on 29 August 1990 "for excessive absences, insubordination, and violation of existing company rules and regulations". ISSUE: Whether or not the excessive absences of the petitioner a valid ground for his termination. RULING: The NLRC found that petitioner had no regard for his work. His applications for a series of leaves of absence attest to his unconcern for his duties in respondent company. On the other hand, respondent company has to protect its interests in order to have an efficient and productive enterprise. It is in this light that the law recognizes what are clearly "management prerogatives", or the right of the employer to hire, fire, transfer, demote or promote employees. Doubtless, what respondent did in this case was a management prerogative. The need for petitioner's presence in the This decision. In the case at bar. petitioner was given only a letter of dismissal without earlier informing him of the charges against him and without giving him the opportunity to defend himself. NLRC 5 ruled: It is evident from the said provisions that the employer is required to furnish an employee who is to be dismissed two (2) written notices before such termination. must come only after the employee is given a reasonable period from receipt of the first notice within which to answer the charge. The second is the notice informing the employee of the employer's decision to dismiss him. The NLRC decision to indemnify petitioner is also affirmed. if he so desires. the continuous and unauthorized absences of petitioner adversely affected the operations of respondent company. The petitioner left the company with no other choice but to terminate his employment. Non-compliance by private respondent with these requirements is a violation of the petitioner's right to due process. this Court in the case of Tiu vs. . Therefore. This may be loosely considered as the proper charge. however. Applying the Omnibus Rules Implementing the Labor Code 4 on the requirements of notice and hearing.company's Texturizing Department cannot be denied. as there is no evidence in the records to show that respondent company observed the twonotice requirement and hearing before dismissing petitioner. and ample opportunity to be heard and defend himself with the assistance of his representative. The first is the notice to apprise the employee of the particular acts or omissions for which his dismissal is sought. 00. JR. the company issued a Notice of Termination: “.we regret to inform youthat we do not consider it valid. 1997 FACTS . You are aware of the company Rules and Regulations that absence without permission for 6 consecutive working days is considered abandonment of work.”Finding said explanation unsatisfactory...Private respondent NAFLU. V NATIONAL FEDERATION OF LABOR UNIONS (NAFLU) DAVIDE.that the penalty of dismissal for such violation is too severe. 1993.”.”. 1993 are unjustified.. that it was notsufficiently established that individual complainant’s absence from April 19. April 17.. 1993 up to May 19. complainant went on absent without permission(AWOP). 1993 to June 16. is a labor union of which complainant is amember. Kaya naman hindi ako naka long distance or telegrama dahilwala akong pera at ibinili ko ng gamot ay puro utang pa. that .. complainant explained:“Sa dahilan po na ako ay hindi nakapagpaalam sainyo dahil inuwi ko ang mga anak ko sa Samar dahil ang asawa koay lumayas at walang magaalaga sa mga anak ko..In answer to the aforesaid memo.Complainants contend that individual complainant’s dismissal was done without just cause. Brew master sent him a Memo: “Please explain in writing within 24 hours of your receipt of thismemo why no disciplinary action should be taken against you for the following offense: You were absent sinceApril 19. a co-complainant in the labor case.BREW MASTER INTERNATIONAL INC.On 20 May 1993. for a period of 1 month.From 19 April 1993 up to 19 May 1993.Complainant was first employed by Brew Master on 16 September 1991 as route helper with the latest daily wageof P119.. may not amount to gross neglect or abandonment of work to warrant outright termination of employment..the NLRC modified the Labor Arbiter's decision and held that complainant’s dismissal was invalid for thefollowing reasons:Complainant-appellant’s prolonged absences. under the law and jurisprudence which upholds the right of an employer to discharge an employee whoincurs frequent... that the act of complainant in absenting from work for 1month without official leave is deleterious to the business of respondent..Relianceon the ruling enunciated in the cited case of Shoemart is quite misplaced because of the obvious dissimilarities--complainant in the Shoemart Case was “an inveterate absentee who does not deserve reinstatement” compared toherein complainant-appellant who is a first offender ISSUE WON the NLRC committed grave abuse of discretion in modifying the decision of the Labor Arbiter HELD .Upon the other hand. Dismissal is too severe a penalty.. Inc. respondent contends that individual complainant was dismissed for cause allowed by thecompany Rules and Regulations and the Labor Code. An employee is deemed to have abandoned his position or to have resigned from thesame..in imposing such penalty. citing the principle of managerial control. respondent should havetaken into consideration complainant’s length of service and as a first offender.The Labor Arbiter dismissed the complaint for lack of merit.that individual complainant has indeed abandoned his work.. “. although unauthorized. a penalty less punitive will sufficesuch as suspension for a definite period. whichrecognizes the employer’s prerogative to prescribe reasonable rules and regulations to govern the conduct of hisemployees.. that it will result to stoppage of productionwhich will not only destructive to respondent’s interests but also to the interest of its employees in general. vs. that thedismissal of complainant from the service is legal.therefore. dismissed for cause. NLRC : “. He relied on Shoemart. whenever he has been absent therefrom without previous permission of the employer for three consecutivedays or more. prolonged and unexplained absences as being grossly remiss in his duties to the employer and istherefore. and (2) a clear intention to sever the employer-employee relationship. there was no one to whom he could entrust thechildren and he was thus compelled to bring them to the province. complainant's absence was justified under the circumstances. unjustified refusal of the employee to resume his employment. As to the second requisite. psychological.complainant’s absence was precipitated by a grave family problem as his wife unexpectedly deserted him andabandoned the family.. Considering that he had a full-time job. Whilehis failure to inform and seek petitioner's approval was an omission which must be corrected and chastised. what is plain is that it was wielded with undue haste resulting in a deprivation of due process. Reasoning . They are impressed with public interestand labor contracts must. thus placing labor contracts ona higher plane and with greater safeguards.our Constitution looks with compassion on the workingman and protects his rights not only under a generalstatement of a state policy. perforce. b) Verily. This isnot to say that his absence should go unpunished. relations between capital and labor are not merely contractual. but under the Article on Social Justice and Human Rights. First. justified.While we do not decide here the validity of petitioner's Rules and Regulations on continuous. In this light.the elements of abandonment are not present here. immediately sued for illegal dismissal. yield to the common good. unauthorizedabsences. as impliedly noted by the NLRC in declining to award back wages. as held above. under these circumstances.NO. and upon knowledge of his termination. Petitioner’s finding that complainant was guilty of abandonment is misplaced. he didnot merit the severest penalty of dismissal from the service. These plainlyrefuted any claim that he was no longer interested in returning to work. just and reasonable. petitioner's dismissal was illegal.spiritual and physical stress and strain.. He was then under emotional.these rules and their implementation must be fair. complainant immediately complied with the memo requiring him toexplain his absence. thus notallowing for a determination of just cause or abandonment. .Two elements must then be satisfied: (1) the failure to report for work or absence without valid or justifiable reason..While the employer is not precluded from prescribing rules and regulations to govern the conduct of his employees. Abandonment as a just andvalid ground for dismissal requires the deliberate. The reason for his absence is. 1992. He needed a 15-day leave because his hometown was a remote area. 1992. Kalinga-Apayao. 168931 September 12.R. FACTS: Petitioner. wherein he . Respondents. Petitioner was registered as a member of the Social Security System (SSS). a Monday.. petitioner asked permission from U-Need Manager Virginia Tan for a 15-day leave of absence.G. 1992 national and local elections. petitioner was promoted as regular driver. was employed on January 3.versus U-NEED LUMBER & HARDWARE. No. private respondent’s business in Baguio City. 2006 PAULINO ALITEN. Petitioner signed a typewritten application for a one-week vacation leave starting May 4. On April 30. He planned to go to his hometown to visit his parents and vote for his uncle Elias Balot who was running for congressman in the May 11. a native of Calanasan. Petitioner. travel could be very difficult and could take roughly 12 days. and COURT OF APPEALS. and considering the mountains and rivers he had to cross. 1988 as helper in U-Need. On October 22. 1990. 00 as alleged by private respondent because as far as he knew. It turned out that. it is understood that he would be automatically terminated by his employer. 1992. Eventually. When he left U-Need on May 4. They claimed that sometime in 1987. This prompted petitioners to terminate his services effective January 2. he asked petitioners’ secretary if he is entitled to 13th month pay and other benefits. Later. However. petitioners. 1997. He signed the typewritten application without reading its contents because he was being scolded by Virginia Tan. vs.00. not Calanasan. he reported the matter to the Department of Labor and Employment. DANTE EMILIA. he took some of his belongings from the lumber’s bunkhouse and left with his brother using a government vehicle.R. it was not in the sum of P1. amounts had been automatically deducted from his wages. SANDOVAL-GUTIERREZ. When he reported for work on May 14.00 per trip. Petitioners denied respondent’s allegations in his complaint. he became a regular truck driver with a salary of P76. 149180. Thereafter. No. GO. Feeling that he was underpaid. J. [G.: FACTS: Respondent.750. Baguio City. 2005] HODIENG CONCRETE PRODUCTS and/or HENRY GO and ERIC B.declared that should he fail to report back for work at the end of his vacation. he recklessly drove and damaged . February 14. he was employed as a truck helper by petitioner with a daily salary of P40. he was a registered voter of Middle Rock Quarry. 1992. in his complaint. he was told that he had already been dismissed from employment. alleged that sometime in January 1985. as gleaned from the records of the Election Registrar. he had an outstanding account. respondent was employed as a truck helper with a salary of P40. He claimed that he only registered therein so that he could cast his vote in Baguio should he fail to return to his domicile. in 1991. respondent. who likewise forced him to sign. Baguio City.00 per trip. Upon receiving a negative response. 1998. and considering that there was no legal cause for private respondent’s termination from employment. ISSUE: Whether or not the dismissal was valid? RULING: “On the alleged abandonment of employment by private respondent. he is entitled under Articles 279 of the Labor Code. an act which negates any intention on the part of the employee to forsake his work. he abandoned his work. By virtue however of private respondent’s refusal to be reinstated. 59-61. the harmonious relationship between him and petitioners had been severed such that reinstatement would no longer be beneficial to either party in which case. a separation pay equivalent to one (1) month pay for every year of service be paid. Moreover. On March 30. Considering our finding that private respondent is a regular employee of petitioners. For failure of petitioners to submit the . another company. As a consequence of the illegal dismissal of the private respondent. separation pay.00 per trip. the contention is not meritorious. ibid). petitioners failed to adduce other evidence on any overt act of private respondent showing an actual intent to abandon his employment. We so hold that petitioners violated the constitutional right of private respondent to security of tenure and due process. jointly and severally. x x x. in 1995. In 1997. The burden of proof is on the employer to show unequivocal intent on the part of the employee to discontinue employment. without deduction of earnings derived elsewhere from the time his compensation was withheld from him up to the time of his actual reinstatement. Petitioners then came to know that he was employed by Vortex. and attorney’s fee equivalent to 10% of the monetary awards.petitioner’s truck. he failed to report for work. As a consequence. to his full backwages. x x x. to pay his backwages and other benefits. Other than the self-serving declarations in the affidavits of their two witnesses (pp. But. he was re-hired as a truck driver with a salary of P76. private respondent filed an illegal dismissal case against petitioners. the Labor Arbiter rendered a Decision holding that respondent was illegally dismissed from employment and ordering petitioners. petitioner verified as correct RCPI’s Field Auditor’s report that there was a shortage of P50. On June 18. petitioner. . petitioner was required by the Field Auditor to explain the cash shortage within 24 hours from notice. Consequently. Petty and General Cash Funds. vs. J. respondents. [G. 1993. 1993.: FACTS: Petitioner Wenifredo Farrol was employed as station cashier at respondent RCPI’s Cotabato City station. 2000] WENIFREDO FARROL. 133259.00 of the cash shortage.985.37 in their branch’s Peragram. petitioner paid to RCPI P25. The next day. The HONORABLE COURT OF APPEALS and RADIO COMUNICATIONS of the PHILIPPINES INC.000.R. On October 1. No. YNARES_SANTIAGO.corresponding employment records such as the payroll to controvert the private respondent’s claim for service incentive leave pay and holiday pay. February 10. respondent RCPI’s district manager in Cotabato City informed their main office that "Peragram funds" from said branch were used for the payment of retirement benefits of five employees. We find the award for the said claim proper. (RCPI). is penalized by immediate dismissal. Two days thereafter. RCPI required petitioner to explain why he should not be dismissed from employment. Respondent RCPI claims that it sent a letter to petitioner on November 22. The conflict was submitted to the grievance committee. Sometime in September 1995. as emphasized under Section No. "c) Deliberate withholding of collections to hide shortages/malversation or misappropriation in any form.00 to RCPI. 1993 informing him of the termination of his services as of November 20. 1993. he again paid two more sums on different dates to RCPI leaving a balance of P6. 63 which strictly requires the daily and up-to-date preparation of Statistical Report and depositing of cash collections twice a day. petitioner requested that he be reinstated considering that the period of his preventive suspension had expired. petitioner wrote a letter to the Field Auditor stating that the missing funds were used for the payment of the retirement benefits earlier referred to by the branch manager and that he had already paid P25. "b) As Station Cashier you must be aware of our company Circular No.995.On October 16. After making two more payments of the cash shortage to RCPI. petitioner was informed by the district manager that he is being placed under preventive suspension. Thereafter. "d) The position of Station Cashier is one which requires utmost trust and confidence. petitioner manifested to RCPI his willingness to settle his case provided he is given his retirement benefits. 1993 due to the following reasons: "a) Your allegation that part of your cash shortages was used for payment of salaries/wages and retirement benefits is not true because these have been accounted previously per auditor’s report. 20 of our Rules and Regulations. Despite the lapse of more than two . Unaware of the termination letter. 1993. However. But these procedures more particularly on depositing of cash collections twice a day .37 of the shortage.was completely disregarded by you.000. RCPI informed petitioner that his employment had already been terminated earlier as contained in the letter dated November 22. On the assumption that there was indeed a breach. However. there is also a corresponding breach of trust. Petitioner has no previous record in his . employer’s rules cannot preclude the State from inquiring whether the strict and rigid application or interpretation thereof would be harsh to the employee. It further mentioned that the position of cashier requires utmost trust and confidence but failed to allege the breach of trust on the part of petitioner and how the alleged breach was committed.years. Assuming further that there was breach of trust and confidence. it was submitted for voluntary arbitration. It should be noted that the term "trust and confidence" is restricted to managerial employees. however. it cannot constitute breach of trust so as to render the dismissal from work invalid. Although the employer has the prerogative to discipline or dismiss its employee. Cash shortages in a cashier’s work may happen. it appears that this is the first infraction committed by petitioner. ISSUE: Whether or not the acts committed by Farrol constituted fraud or willful breach of trust RULING: A perusal of RCPI’s dismissal notice reveals that it merely stated a conclusion to the effect that the withholding was deliberately done to hide alleged malversation or misappropriation without. and when there is no proof that the same was deliberately done for a fraudulent or wrongful purpose. Infractions committed by an employee should merit only the corresponding sanction demanded by the circumstances. but must be controlled by substantive due process and tempered by the fundamental policy of protection to labor enshrined in the Constitution. such prerogative cannot be exercised wantonly. petitioner’s infraction is punishable by dismissal. the case remained unresolved before the grievance committee. conduct or omission imputed to the employee and imposed in connection with the employer’s disciplinary authority. hence. stating the facts and circumstances in support thereof. RCPI alleged that under its rules. there is no evidence that petitioner was a managerial employee of respondent RCPI.  It may not even be presumed that when there is a shortage. The penalty must be commensurate with the act. however. 2005] P. [G. and PHILIPPE J. The Court thus holds that the dismissal imposed on petitioner is unduly harsh and grossly disproportionate to the infraction which led to the termination of his services. petitioner paid back the cash shortage in his accounts. LHUILLIER INC.: FACTS: Vincent “Vicente” Montenegro was the appraiser/manager of the petitioner corporation’s Bauan Branch in Batangas. A lighter penalty would have been more just. respondents. In any case. No. petitioners. Considering. 158758. it would no longer be practical to order his reinstatement. Lailanie Palma. J.J. the Chairman of the Investigation Committee issued a Notice of Disciplinary Action dated 06 September 1997 wherein said employee was meted a ten (10)-day suspension and transfer of assignment . NATIONAL LABOR RELATIONS COMMISSION and HERMINIA MONTENEGRO.this would have been his first offense. LHUILLIER.twenty-four long years of service . CHICO-NAZARIO. a trainee of the company. A committee was formed to investigate him for the alleged sexual harassment. charged him with sexual harassment.R. vs. if not humane. that the latter is about to retire or may have retired from work. On the basis of the formal investigation conducted. April 29. ISSUE: Whether or not the termination of the respondents were with just cause? . Carlos Pedro Sara was charged with incompetence and dishonesty. A formal administrative investigation was conducted on 15 October 1997. Findings of said investigation showed that respondent Herminia Montenegro committed dishonesty and misconduct violative of Rule 22. he was transferred to Makati. Herminia Montenegro averred. Herminia Montenegro was charged with dishonest acts committed by causing the redemption of two (2) pieces of jewelry specifically described in pawn tickets 008664 and 008665. the investigating committee reported that Sara admitted having intentionally overweighed an item in favor of a customer but the report about which he refused to sign. that her only participation was the approval of the redemption of the pawned items by a certain Agnes Moradas who submitted an affidavit of loss of pawnshop tickets. As for the fake item she accepted. She claims that she had to accept the over-appraised item to attract customers as the branch has just opened. with a warning that a repetition of said violation will be penalized with the supreme sanction of dismissal. hence. Section 2 of the Handbook on Company Policies. Noble avers that the item is so thickly plated that it could not be detected by merely applying the usual procedure. It was also discovered that Sara was directly responsible for the loss of certain jewelry as disclosed in an audit report. however. he was meted 35 days suspension which he contends is a violation of the 30day suspension. Thereafter. effective the next working day from receipt thereof for violation of Section 9 of the Handbook on Company Policies and Guidelines and Employee’s Code of Conduct. she was dismissed from employment. During the formal investigation conducted on 05 December 1997. Makati City. through the use of falsified affidavit of loss. it was discovered and admitted by Noble that she intentionally overappraised the subject pawned fake item by increasing their true weights. Later. During the administrative investigation conducted on 05 December 1997. it turned out that the fake items belong to Noble herself. Vincent Montenegro claims that for the sexual harassment case.to the CLH-Zobel Branch. Marites Noble was charged with having involved in the over-appraisal of an item and having accepted a gold plated item. allegedly. the issue of the veracity of the signature appearing on the questioned Affidavit of Loss has been undoubtedly passed upon by. This clearly involves a factual inquiry.RULING: At the onset. Be that as it may. the determination of which is the statutory function of the NLRC. are conclusive upon the parties and binding on this Court. as affirmed by the NLRC and the Court of Appeals. The petitioners are fundamentally raising a question of fact regarding the appellate court’s finding that the charge of falsification was not substantially proved. not two. Elementary is the principle that this court is not a trier of facts. We find no basis for deviating from the aforestated doctrine without any clear showing that the findings of the labor arbiter. “Well-settled is the rule that the jurisdiction of this Court in a petition for review on certiorari under Rule 45 of the Revised Rules of Court is limited to reviewing only errors of law. it is pertinent to note that the second issue raised in the instant petition inquires into the factual findings of the court a quo. In the case at bar. not of fact. the findings of facts and conclusion of the NLRC are generally accorded not only great weight and respect but even clothed with finality and deemed binding on this Court as long as they are supported by substantial evidence. we believe it proper to address and clarify petitioners’ postulation that the Court of Appeals adopted the view that the degree of proof required in Labor cases is proof beyond reasonable doubt instead of merely substantial evidence. unless the factual findings complained of are completely devoid of support from the evidence on record or the assailed judgment is based on a gross misapprehension of facts. Judicial review of labor cases does not go beyond the evaluation of the sufficiency of the evidence upon which its labor officials’ findings rest. As such. not one. but three tribunals all having the same findings that there is no evident showing that the said document is indeed falsified. . are bereft of sufficient substantiation. factual findings of quasi-judicial agencies like the NLRC. The petitioner would have us sift through the evidence on record and pass upon whether the signatures found on the Affidavit of Loss vis-à-vis the pawn tickets are similar or not. when affirmed by the Court of Appeals.” What is more. INC.versus Carpio. The NLRC. Montenegro was the one who caused the execution thereof. There is no showing that the affidavit of loss was a falsified one. Petitioners. . Neither is there any competent evidence submitted by the respondents to prove that Mrs. PHILIPPINE PIZZA. Quisumbing. . said affidavit stands and cannot be said to have been forged or a fake one. granting that the same is a falsified one. JJ. C. found it hard to see the basis of the loss of trust and confidence in the light of the insufficiency of evidence presented by the petitioners. succinctly put thus: . .Petitioners allege that they have lost trust and confidence in the respondent due to the latter’s actions. Promulgated: Respondent. No.J. Ynares-Santiago. KIM M. and JANET RUTH M. however. Henceforth. SOLSOLOY. formerly G. PIZZA HUT DIVISION. The Labor Arbiter. added that: The Affidavit of Loss not having been repudiated by the one who executed the same. Davide. (Chairman). and Azcuna.. Jr.. we sustain the findings and ruling of the Labor Arbiter relative to complainant Ms.. May 9.R. Hence. BUNGABONG.. 154315 PHILIPPINE FRANCHISE PROGRESSIVE DEVELOPMENT Present: CORP. affirming the aforequoted pronouncement of the Labor Arbiter. Montenegro. her dismissal from employment based on the charge against her is illegal. 2005 . . and then told him to file an incident report. Criselda Cusi.x--------------------------------------------------x DECISION QUISUMBING. Respondent denied any involvement in the theft of beer. On December 15. which followed after the investigation. She told respondent he should no longer report for work. also reported on how the respondent bragged how much beer he could drink on his way passing out of the beer dispenser area.. a certain Ms. driver Andra was with the Vice-President for HRD. A crew member of the outlet. Solsoloy. J. Daniel Gatdula. the outlet’s unit manager. inquiring about the latter’s involvement. allegedly caught one Felix Sabado. Respondent was advised to go home. another employee. at around 11:30 to 12:00 p. He then refused to receive his letter of termination. Andra then pointed to respondent. respondent stated. A guard on duty. he concluded that respondent was involved too. a driver. consuming some beer from the establishment’s beer dispenser. While the duty manager did not actually see respondent. On December 6. 1997 at around 1:30 a. also stated that on the evening of said date. the duty manager called respondent. 1997. Jonathan Andra. respondent was informed of his preventive suspension. reported that he saw respondent with Sabado drinking beer from the dispenser. During the investigation. asserting that only Sabado was involved and was caught. co-petitioner Janet Ruth M. he confronted respondent and asked why respondent smelled of beer. the Duty Manager Alvin Biscocho. After the investigation. but respondent ignored the inquiry and hurriedly left. Rossman Manaloto. because earlier that night. and showed him a letter of Sabado admitting to the offense of drinking beer. Ellen of the HRD explained to the respondent the penalty for his alleged offense.m.m. and stated that respondent was with Sabado in drinking the company’s beer on December 5. issued an offense notice. The next day. Thereafter.: FACTS: Respondent Bungabong had been working for five years as a food attendant in petitioners’ Ermita outlet. Cusi reported the incident to the head office of Pizza Hut. He was told to report to the Human Resources Department (HRD) of the company for investigation. the petitioners could be justly faulted.ISSUE: Whether or not respondent held a position entrusted with trust and confidence? RULING: Contrary to the ruling of the Labor Arbiter and the NLRC. Answer and hearing. 6. established the existence of just cause to terminate respondent on the ground of loss of trust and confidence. outlines the procedure for termination of employment. Notice of Dismissal. Sec. the relationship of the employer and the employee necessarily involves trust and confidence. 1. Decision to dismiss. – No worker shall be dis missed except for a just or authorized cause provided by law and after due process. Book V. as regards violations of the procedural requirement for valid dismissal. – Any employer who seeks to dismiss a worker shall furnish him a written notice stating the particular acts or omissions constituting the grounds for his dismissal. Now. if he so desires. . Sec. In cases of abandonment of work. . he gave cause for his termination and his termination was within the ambit of Article 282 of the Labor Code. Inc. . however. . Rule XIV of the Omnibus Rules Implementing Batas Pambansa Blg. we find that petitioner Philippine Pizza. Sec. 2. – The worker may answer the allegations stated against him in the notice of dismissal within a reasonable period from receipt of such notice. which eventually the Court of Appeals affirmed. The employer shall afford the worker ample opportunity to be heard and to defend himself with the assistance of his representatives. Where the employee has access to the employer’s property in the form of merchandise and articles for sale. 1997. when respondent drank stolen beer from the dispenser of Pizza Hut-Ermita on December 6. the notice shall be served at the worker’s last known address. Hence. It provides as follows: Sec. 130 in effect at the time respondent was terminated. Security of tenure and due process. 5. – The employer shall immediately no tify a worker in writing of a decision to dismiss him stating clearly the reasons therefor. The offense notice petitioners gave to respondent is insufficient first notice because it did not comply with the requirement of the law that the first written notice must apprise the employee that his termination is being considered due to the acts stated in the notice. Petitioners . we find that petitioners violated respondent’s right to due process. G. Respondents. 165407 . around 11:30 to 11:45 p. 1997. No. particularly the requirement of first notice.versus FIRST PHILIPPINE SCALES.. The first notice issued in this case merely stated that respondent is being charged of dispensing and drinking beer on December 5. HERMINIGILDO INGUILLO AND ZENAIDA BERGANTE. INC.m.In this case.R. and nothing more. MANAGER. and/or AMPARO POLICARPIO. 444. 1986.72 of which came from the salary of Grutas. Amparo Policarpio (Policarpio). Shirley Tapang.18. NLM-KATIPUNAN filed with the Department of Labor and Employment (DOLE) an intra-union dispute against FPSILU and FPSI. 1996. During the lifetime of the CBA. signed the said document. In said case. seeking the termination of the services of the following employees. the members of FPSILU ratified the CBA in a document entitled RATIPIKASYON NG KASUNDUAN. In 1991. Gilbert Lucero. 1991. the amount of P5. P1. the duration of which was for a period of five (5) years starting on September 12. Inc. It also ordered the officers and members of NLM-KATIPUNAN to return to FPSILU the amount of P90.000.032. Inguillo and several FPSI employees joined another union. (Grutas) and Inguillo. Upon finality of the Med-Arbiter's Decision. for brevity). (FPSI). a Writ of Execution was issued to collect the adjudged amount from NLM-KATIPUNAN. 1996 denominated as “Petisyon” to FPSI's general manager. Gerry Trinidad. 1996. namely: Grutas.55 was collected. FPSI and First Philippine Scales Industries Labor Union (FPSILU)  entered into a Collective Bargaining Agreement (CBA). notices of garnishment were issued to United Coconut Planters Bank (Kalookan City Branch) and to FPSI for the latter to hold for FPSILU the earnings of Domingo Grutas. Yolanda Tapang.695. Resultantly. to the extent of P13. 1977 and September 10. However. respectively. formerly FPSILU's President and Secretary for Finance. Bergante and Inguillo. employed Bergante and Inguillo as assemblers on August 15.140. respectively. On September 19. as no amount was recovered. while the P3. a domestic corporation engaged in the manufacturing of weighing scales.FACTS: First Philippine Scales. on March 29. Jr. . the Nagkakaisang Lakas ng Manggagawa (NLM). 1991 until September 12. the Med-Arbiter decided in favor of FPSILU. which was affiliated with a federation called KATIPUNAN (NLMKATIPUNAN. Bergante. Meanwhile.83 came from that of Inguillo. Subsequently.00 pertaining to the union dues erroneously collected from the employees. who were members of FPSILU. the executive board and members of the FPSILU addressed a document dated March 18. care of the President. We hold that all the requisites have been sufficiently met and FPSI was justified in enforcing the Union Security Clause. i. petitioners were among the 93 employees who affixed their signatures to the document that ratified the CBA. and (5) poisoning the minds of the rest of the members of the Union so that they would be enticed to join the rival union. ISSUE: Whether or not the security union clause was valid RULING: In terminating the employment of an employee by enforcing the Union Security Clause. the employer needs only to determine and prove that: (1) the union security clause is applicable.by failing to call periodic membership meetings and to give financial reports. FPSI was justified in applying the Union Security Clause.e. FPSILU cited other grounds committed by petitioners and the other employees which tend to prejudice FPSI’s interests. for the following reasons: First. dereliction of duty . the existence and validity of which was not questioned by either party.Inguillo.. They cannot now turn their back and deny knowledge of such provision. as it was a valid provision in the CBA. (2) dereliction of duty by failing to call periodic membership meetings and to give financial reports. on the following grounds: (1) disloyalty to the Union by separating from it and affiliating with a rival Union. and (3) there is sufficient evidence to support the union's decision to expel the employee from the union or company. the NLM-KATIPUNAN. Second. preventing the Union to even attempt to ask for an increase in benefits from the former. and Vicente Go. Bergante. (3) depositing Union funds in the names of Grutas and former Vice-President Yolanda Tapang. Aside from joining another rival union. instead of in the name of FPSILU. FPSILU acted on its prerogative to recommend to FPSI the dismissal of the members who failed to maintain their membership with the Union. (2) the union is requesting for the enforcement of the union security provision in the CBA. depositing union funds in . Moreover. (4) causing damage to FPSI by deliberately slowing down production. Once affiliated with NLM-KATIPUNAN. This is evident from the intra-union dispute filed by NLMKATIPUNAN against FPSILU. 1987 TANDUAY DISTILLERY LABOR UNION VS NLRC FACTS: Private respondents were all employees of Tanduay Distillery. Their then affiliation with FPSILU was also clearly shown by their signatures in the document which ratified the CBA. and poisoning the minds of the rest of the members of the Union so that they would be enticed to join the rival union. causing damage to FPSI by deliberately slowing down production. Inguillo was the Secretary of Finance. No. they committed acts of disloyalty to the Union when they failed not only to maintain their membership but also disaffiliated from it. Third. 75037 April 30. Without a doubt. the underlying reason why his salary was garnished to satisfy the judgment of the Med-Arbiter who ordered NLMKATIPUNAN to return the Union dues it erroneously collected from the employees. Inc. FPSILU's decision to ask for the termination of the employees in the “Petisyon” was justified and supported by the evidence on record.the names of Grutas and former Vice-President Yolanda Tapang. They abandoned FPSILU and even joined another union which works against the former's interests. a duly organized and . Bergante and Inguillo were undisputably former members of FPSILU. (TDI) and members of the Tanduay Distillery Labor Union (TDLU).. \ G. preventing the Union from even attempting to ask for an increase in benefits from the former.R. instead of in the name of FPSILU care of the President. Bergante and Inguillo proceeded to recruit other employees to disaffiliate from FPSILU and even collected Union dues from them. In fact. and b) whether or not TDI is guilty of unfair labor practice in complying with TDLU's demand for the dismissal of private respondents. as a condition of their continued employment. By letter. expelled the private respondents from TDLU for disloyalty to the Union.registered labor organization and the exclusive bargaining agent of the rank and file employees of the petitioner company. private respondents contend that their act of organizing a local chapter of KAMPIL and eventual filing of a petition for certification election was pursuant to their constitutional right to self-organization. was executed between TDI and TDLU. TDLU. The CBA was duly ratified by a majority of the workers in TDI including herein private respondents and contained a union security clause which provides that “all workers who are or may during the effectivity of the CBA. KAMPIL filed a petition for certification election to determine union representation in TDI. TDLU notified TDI that private respondents had been expelled from TDLU and demanded that TDI terminate the employment of private. become members of the Union in accordance with its Constitution and ByLaws shall. Thereafter. A Collective Bargaining Agreement (CBA). respondents because they had lost their membership with TDLU. In their petition. maintain membership in good standing in the Union for the duration of the agreement. The private respondents were later on terminated. the Kaisahan Ng Manggagawang Pilipino (KAMPIL) and organized its local chapter in TDI. ISSUES: a) whether or not TDI was justified in terminating private respondents' employment in the company on the basis of TDLU's demand for the enforcement of the Union Security Clause of the CBA between TDI and TDLU. through the Investigating Committee and approved by TDLU's Board of Directors. HELD: .” While the CBA was in effect and within the contract bar period the private respondents joined another union. which development compelled TDI to file a grievance with TDLU. TDLU created a committee to investigate its erring members in accordance with its by-laws which are not disputed by the private respondents. They do not constitute unfair labor practice nor are they violations of the freedom of association clause of the Constitution. VALIAO. There is no showing in these petitions of any arbitrariness or a violation of the safeguards enunciated in the decisions of this Court interpreting union security arrangements brought to us for review. the union shop. [G.R. the maintenance of treasury shop. July 30.The dismissal of an employee pursuant to a demand of the majority union in accordance with a union security agreement following the loss of seniority rights is valid and privileged and does not constitute an unfair labor practice. No. The closed shop. FACTS: . vs. and check-off provisions are valid forms of union security and strength. Article 249 (e) of the Labor Code as amended specifically recognizes the closed shop arrangement as a form of union security. respondents. the maintenance of membership shop. petitioner. NATIONAL LABOR RELATIONS COMMISSION-FOURTH DIVISION (Cebu City). WEST NEGROS COLLEGE. HON. the preferential shop. 2004] RENE P. COURT OF APPEALS. 146621. 1992. The petitioner was then appointed as Information Assistant effective immediately.On February 5. 1992. 1990. which showed him to have been absent or late for work from a minimum of seven (7) to a maximum of seventy-five (75) minutes for the period March to October 31. However.800 per month. and to have reported late almost every day for the period November to December 1991. 1992. 1990. Subsequent reports also showed that he did not change his habits resulting in tardiness and absences. who gave petitioner another chance. 1991. 1991. petitioner was transferred to a staff position and designated as Records Chief at the Registrar’s Office but was again re-assigned as a typist on June 24. After serving the suspension. Alumni Affairs Office. Copies of his tardiness/absences reports were furnished petitioner. because of dishonesty in reporting his actual attendance. On December 10. On June 20. On May 14. he was assigned as Acting Director. Suzette Arbolario-Agustin. calling his attention on his tardiness and absences for the period February to April 1992. petitioner received a suspension order without pay for fifteen (15) days effective January 1. along with memoranda requiring him to explain but his explanations were either unacceptable or unsatisfactory. thus necessitating another memorandum to him asking him to explain his dishonest actuations in accomplishing the daily attendance logbook and in using the bundy clock. On July 29. the petitioner did not immediately assume the post of Information Assistant prompting the President of private . 1990. He was even caught one time manipulating the bundy clock. The latest re-assignment was due to his tardiness and absences. another adverse report on tardiness and absences from the Registrar was made against the petitioner prompting WNC to send him another memorandum with an attached tardiness and absences report. 1991. as reflected in the summary of tardiness and absences report. the petitioner reported back to office on January 16. On June 15. with a starting salary of P2. 1992. petitioner sent a letter of appeal and explained his side to the new college president. petitioner Rene Valiao was appointed by private respondent West Negros College (WNC) as Student Affairs Office (SAO) Director. (a) the dismissal must be for a valid cause and (b) the employee must be afforded due process. Petitioner’s repeated acts of absences without leave and his frequent tardiness reflect his indifferent . we find the petition without merit. When petitioner reported for work on the first day of January 1993.respondent WNC to call his attention. depending upon the circumstances. Habitual neglect implies repeated failure to perform one’s duties for a period of time. Gross negligence connotes want of care in the performance of one’s duties. he was relieved from his post and transferred to the College of Liberal Arts as Records Evaluator. he was allowed a part-time teaching job in the same school to augment his income. Not for long. the Dean of the Liberal Arts sent a letter to the Human Resources Manager complaining about the petitioner’s poor performance and habitual absenteeism. Petitioner’s dismissal from employment is valid and justified. When the petitioner finally assumed his post. ISSUE: Whether or not the acts of the petitioner constitute gross and habitual neglect of duties RULING Considering the submissions of the parties as well as the records before us. Serious misconduct and habitual neglect of duties are among the just causes for terminating an employee under the Labor Code of the Philippines. For an employee’s dismissal to be valid. as shown in the daily absence reports. Petitioner was ordered to prepare a media blitz of this victory but the petitioner did not comply with the order on the ground that such a press release would only worsen the already aggravated situation and strained relations between WNC management and the union officials. WNC won a case against the officials of the union before the NLRC. Sometime in December 1992. The Labor Arbiter’s findings that petitioner’s habitual absenteeism and tardiness constitute gross and habitual neglect of duties that justified his termination of employment are sufficiently supported by evidence on record. petitioner claims that he was dismissed not for his tardiness or absences but for his arrest as a suspected drug user. but petitioner failed to controvert said reports. he was not punctual in reporting for work. due process was properly observed. First. we held that where the records clearly show that the employee has not only been charged with the offense of highgrading but also has been warned 21 times for absences without official leave. 6425 but on the totality of the number of infractions incurred by the petitioner during the period of his employment in different positions he occupied at WNC. constitute gross misconduct unexpected from an employee of petitioner’s stature.  (Emphasis and italics supplied) Indeed. the NLRC. the decisions of the Labor Arbiter. contrary to petitioner’s assertion. however. his repeated and habitual infractions. In one case. However. WNC had more than enough basis for terminating petitioner from employment. committed despite several warnings. it hardly needs reminding that. In exercising such management prerogative. His claim. these repeated acts of misconduct and willful breach of . More importantly. Act No. We find such contention devoid of basis. They show that indeed petitioner had incurred numerous and repeated absences without any leave. even without the arrest incident. This Court has held that habitual absenteeism without leave constitute gross negligence and is sufficient to justify termination of an employee. 1993 incident. he must demonstrate a scrupulous regard for rules and policies befitting those who would be role models for their young charges. the NLRC did not base its conclusions on the fact of the arrest of petitioner for violation of Rep. These unexplained absences and tardiness were reflected on the summary reports submitted by WNC before the labor arbiter. It bears stressing that petitioner’s absences and tardiness were not isolated incidents but manifested a pattern of habituality. Private respondent took into consideration the totality of the infractions or the number of violations committed by petitioner during the period of employment. his services were terminated by private respondent after having been found guilty of serious misconduct and gross habitual neglect of duty which was aggravated by the January 28. Furthermore. Private respondent presented sufficient evidence to support its act in terminating the services of petitioner. Thus: In the case of petitioner Valiao. and the Court of Appeals are indubitable. in view of petitioner’s position and responsibilities.attitude to and lack of motivation in his work. Second. is merely speculative. Moreover. conduct. The totality of infractions or the number of violations committed during the period of employment shall be considered in determining the penalty to be imposed upon an erring employee. Fitness for continued employment cannot be compartmentalized into tight little cubicles of aspects of character. and ability separate and independent of each other. Alvarez vs. Needless to say.. No. 2013 FACTS: . September 25. Even as the law is solicitous of the welfare of employees.R. it must also protect the rights of an employer to exercise what are clearly management prerogatives. G. such exercise will be upheld.trust by an employee justify his dismissal and forfeiture of his right to security of tenure. The offenses committed by him should not be taken singly and separately but in their totality. Golden Tri Bloc Inc. so irresponsible an employee like petitioner does not deserve a place in the workplace. 202158. As long as the company’s exercise of those rights and prerogative is in good faith to advance its interest and not for the purpose of defeating or circumventing the rights of employees under the laws or valid agreements. and it is within the management’s prerogative of WNC to terminate his employment. the petitioner’s senior officer called the Super 8. and requested her to “punch-in” his time card to reflect that he is already on duty. he attained the status of a regular employee. Since his time card was at the San Roque branch. On May 27. After which the petitioner was placed on preventive suspension for 30 days without pay. Super 8. She obliged. He was thereafter promoted as Shift Leader and served as such for four (4) years. Cogeo and Super 8. the petitioner reported for duty at around 12:30 in the afternoon at Dunkin Donuts. all in Antipolo City. the petitioner admitted instructing Sambo to punch-in his timecard. he telephoned Chastine3 Kaye Sambo (Sambo). He explained that he went straight to and arrived at the Super 8. On June 5. 2009.Sometime in November 1996. On June 23. Masinag branch and verified that he has indeed reported for work. Rizal. respondent GTBI hired the petitioner as a Service Crew in one of its Dunkin Donuts franchise store in Antipolo City. however. GTBI sent him a letter directing him to report to the main office for a dialogue on June 9. Masinag branch. Roland Salindog (Salindog). shift leader. He owned up to his fault and stated that he should have instead recorded the time of his arrival by writing on the time card and that he should have brought it with him. He received a monthly salary of P10. he was again promoted as Outlet Supervisor and was assigned to three (3) Dunkin Donuts outlets located at San Roque. Sometime in 2001. In his incident report4 dated May 29.000. Masinag. 2009. . GTBI notified the petitioner of its decision to terminate his employment effective that day on the ground of loss of trust.00. 2009. Six (6) months later.5 The dialogue pushed through. He inspected the stocks in the branch and taught a certain ‘Ritz’ on how to prepare stocks acquisition report for June 2009. the petitioner was informed by Sambo that both of them are suspended and that he had to prepare an incident report regarding his time card. 2009. Masinag branch at around 12:35 p. The following day. 2009 failing which would amount to the waiver of his right to be heard and the management may make a decision based only on his written explanation. He apologized and promised that a similar incident will not happen again.m. ISSUE: Whether or not the termination on the ground of loss was valid? RULING: "In Merin v. It has the right to dismiss such an employee if only as a measure of selfprotection. G. conduct and ability separate and independent of each other. the record of an employee is a relevant consideration in determining the penalty that should be meted out since an employee's past misconduct and present behavior must be taken together in determining the proper imposable penalty. this does not and should not mean that his employment record would be wiped clean of his infractions. Phil Airlines. Fitness for continued employment cannot be compartmentalized into tight little cubicles of aspects of character. he continued to commit misconduct and exhibit undesirable behavior on board. Despite the sanctions imposed upon petitioner. the employee may consider and weigh his other past infractions. No. 17. 168081. 2008 . While it may be true that petitioner was penalized for his previous infractions. NLRC. thus: "'The totality of infractions or the number of violations committed during the period of employment shall be considered in determining the penalty to be imposed upon an erring employee. Oct. Indeed. (Citations omitted)'" The NLRC and the CA were thus correct in applying the totality of infractions rule and in adjudging that the petitioner's dismissal was grounded on a just and valid cause. or one who is guilty of acts inimical to its interests." Yrasuegui vs. the employer cannot be compelled to retain a misbehaving employee.R. The offenses committed by petitioner should not be taken singly and separately. the Court ruled that in determining the sanction imposable to an employee. After all. 1984 to March 4. as mandated by the Cabin and Crew Administration Manual of PAL. Tersely put. 1985 to address his weight concerns.‖ Finally in 1993. The proper weight for a man of his height and body structure is from 147 to 166 pounds. 215lb.Facts: Armando G. The CA reversed the NLRC. 1985 to November 1985 was imposed. ―and considering the utmost leniency‖ extended to him ―which spanned a period covering a total of almost five (5) years. As explained by the CA: x x x [T]he standards violated in this case were not mere ―orders‖ of the employer. they were the ―prescribed weights‖ that a cabin crew must . an employee may be dismissed the moment he is unable to comply with his ideal weight as prescribed by the weight standards. The weight standards of PAL constitute a continuing qualification of an employee in order to keep the job. backwages and attorney‘s fees. During that period he was requested to lose weight and to report for weight checks which he constantly failed to do.‖ his services were considered terminated ―effective immediately. and 205. In the meantime his status was ―off-duty. 1988 to February 1989. (PAL). petitioner was formally informed by PAL that due to his inability to attain his ideal weight. Inc. Yrasuegui was a former international flight steward of Philippine Airlines. For failure to meet the weight standards another leave without pay from March 5. Ruling: The obesity of petitioner is a ground for dismissal under Article 282(e) of the Labor Code. From 1989 to 1992 his weight fluctuated from 209lb. The NLRC affirmed the LA. the ideal weight being 166 pounds. 217lb. Issue: Whether or not petitioner was illegally dismissed. The dismissal would fall under Article 282(e) of the Labor Code. He met the required weight and was allowed to work but his weight problem recurred. 212lb. He stands five feet and eight inches (5‘8‖) with a large body frame. His weight problem dates back to 1984 when PAL advised him to go on an extended vacation leave from December 29. thus another leave without pay from October 17.‖ He then filed a complaint for illegal dismissal against PAL. The Labor Arbiter ruled that he was illegally dismissed and entitles to reinstatement. but is nonetheless voluntary. 169549. when placed in the context of his work as flight attendant. Sept. vs. … The failure to meet the employer‘s qualifying standards is in fact a ground that does not squarely fall under grounds (a) to (d) and is therefore one that falls under Article 282(e) – the ―other causes analogous to the foregoing. John Hancock Life Insurance Corp. they were standards that establish continuing qualifications for an employee‘s position. Davis.‖ By its nature.R. 3. No. In other words. x x x We hold that the obesity of petitioner. G. His obesity may not be unintended. these ―qualifying standards‖ are norms that apply prior to and after an employee is hired. 2008 Facts: .maintain in order to qualify for and keep his or her position in the company. becomes an analogous cause under Article 282(e) of the Labor Code that justifies his dismissal from the service. found that Davis committed serious misconduct (she was the principal suspect for qualified theft committed inside petitioner's office during work hours). Davis filed a complaint for illegal dismissal alleging that petitioner terminated her employment without cause. they did not constitute substantial evidence. Because the affidavits of the witnesses were not verified. Patricia Yuseco. Because loss of personal property among its employees had become rampant in its office. the city prosecutor dismissed the complaint due to insufficiency of evidence. Thus. 2003 and denied her motion for reconsideration in October 30. she was informed that "Patricia Yuseco" had just made substantial purchases using her credit cards in various stores in the City of Manila. Upon petition for certiorari filed with the CA. Meanwhile. NLRC affirmed the labor arbiter in July 31. Yuseco and other witnesses positively identified the person in the video as Davis NBI and Yuseco filed a complaint for qualified theft against Davis but because the affidavits presented by the NBI (identifying respondent as the culprit) were not properly verified.Joanna Cantre Davis was agency administration officer of John Hancock Life Insurance Corporation. JHLIC‘s corporate affairs manager. the dropping of charges against an employee (especially on a technicality such as lack of proper verification) or his subsequent acquittal does not preclude an employer from dismissing him due to serious misconduct. petitioner sought the assistance of NBI. Hence. Petitioner moved for reconsideration but it was denied. Upon appeal. in May 21. accusations and conclusions of employers (did) not provide legal justification for dismissing an employee". the complaint was dismissed for lack of merit. 2003. 2000. There was a valid cause for her dismissal. The labor arbiter. 2002. discovered that her wallet was missing. The labor arbiter and NLRC should have assessed evidence independently as "unsubstantiated suspicions. 2005 granted the petition holding that the labor arbiter and NLRC merely adopted the findings of the NBI regarding respondent's culpability. obtained a security video from Abenson's showing the person who used Yuseco's credit cards. She immediately reported the loss of her credit cards to AIG and BPI Express. On October 18. Thus. this petition where petitioner argues that the ground for an employee's dismissal need only be proven by substantial evidence. To her surprise. The NBI. CA on July 4. She was also told that a proposed transaction in Abenson's-Robinsons Place was disapproved because "she" gave the wrong information upon verification. petitioner placed Davis under preventive suspension and instructed her to cooperate with its ongoing investigation. . Issue: Whether or not petitioner substantially proved the presence of valid cause for respondent's termination. A cause analogous to serious misconduct is a voluntary and/or willful act or omission attesting to an employee's moral depravity. she could not be dismissed for serious misconduct. petitioner dismissed Davis based on the NBI's finding that the latter stole and used Yuseco's credit cards. they did not merely adopt the findings of the NBI but independently assessed . willful in character. Nonetheless. For an employee to be validly dismissed for a cause analogous to those enumerated in Article 282. the cause must involve a voluntary and/or willful act or omission of the employee. Misconduct involves "the transgression of some established and definite rule of action. In this case. The labor arbiter and the NLRC relied not only on the affidavits of the NBI's witnesses but also on that of respondent. and implies wrongful intent and not mere error in judgment". forbidden act. They likewise considered petitioner's own investigative findings. it must be: of grave and aggravated character and not merely trivial or unimportant and connected with the work of the employee. if proven by substantial evidence. (e) Other causes analogous to the foregoing. Article 282 (e) of the Labor Code talks of other analogous causes or those which are susceptible of comparison to another in general or in specific detail. respondent's misconduct was not work-related and therefore. Did petitioner substantially prove the existence of valid cause for respondent's separation? Yes. is a cause analogous to serious misconduct. But since the theft was not committed against petitioner itself but against one of its employees. — An employer may terminate an employment for any of the following causes: (a) Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or his representatives in connection with his work. Clearly. a dereliction of duty. Article 282 of the Labor Code provides: Termination by Employer. For misconduct to be serious and therefore a valid ground for dismissal. Ruling: Supreme Court granted the petition and ruled that petitioner validly dismissed Davis for cause analogous to serious misconduct. Theft committed by an employee against a person other than his employer. NLRC G. Magnolia Dairy Products Corporation v. NO. 1996 .R.evidence presented by the parties. Their conclusion (that there was valid cause for respondent's separation from employment) was therefore supported by substantial evidence. 114952. January 29. Lippercon Services. a division of San Miguel Corporation (SMC). In answer thereto. but assigned her back on May 2. assigned her to petitioner’s Tetra Paster Division as a cleaning aide.. Inc. and (iv)to clean leftovers of leaking tetra pack by mopping or washing the contaminated premises. as amended.. Inc. and Lippercon Services. to terminate the employment of any employee due to the installation of labor saving devices. Nonetheless.. Skillpower.. Inc. 1983.” In September 1986. private respondent applied with Lippercon Services. this did not excuse petitioner from complying with the required written notice to the employee and to the . Inc. The installation of these devices is a management prerogative. Skillpower.. In December 1987. 1987 with the same functions. (ii)to replace damaged goods and re-paste the carton thereof.Facts: Petitioner. Calibo to petitioner’s Tetra Paster Division with these functions: “(i)to remove “bulgings” (damaged goods) from dilapidated cartons. but the Labor Arbiter emphasized that this did not exculpate petitioner from the charge of illegal dismissal for its failure to observe the due process of law in terminating from service its employee. as in this case. like the herein petitioner. When petitioner’s contract with Skillpower. private respondent instituted a complaint for illegal dismissal against petitioner. The Labor Arbiter ruled that petitioner is the private respondent’s employer because Skilipower. The installation of labor saving devices was also ruled a valid ground for the termination of private respondent’s employment. or maliciousness on the part of management. a duly organized corporation engaged in the business of offering and providing manpower services to the public. Inc. Issue: Was there an authorized cause for the termination? Ruling: The law authorizes an employer... Book III of the Omnibus Rules Implementing the Labor Code. she was terminated from service due to petitioner’s installation of automated machines. also a corporation engaged in providing manpower services. In July 1987. (iii)to dispose the damaged goods or returned goods from Magnolia’s warehouse to avoid bad odors. were mere “labor-only” contractors falling under Section 9. On June 11. pulled-out private respondent from petitioner’s Tetra Paster Division. 1989. Inc. assigned private respondent Jenny A. and the courts will not interfere with its exercise in the absence of abuse of discretion..an authorized cause for dismissal under the Labor Code. Inc. entered into a contract of service with Skillpower. On July 11. arbitrariness. Inc. Rule VIII. petitioner averred that it has no employeremployee relationship with private respondent and that the dismissal was prompted by the installation of labor saving devices . expired. Inc. Irrefutable was the fact that losses have bled Asian Alcohol incessantly over a span of several years. Of these positions. were driven by mounting business losses to sell their majority rights to prior Holdings. Prior Holdings implemented a reorganizational plan and other cost-saving measures. Private respondents Carias. who originally owned the controlling stocks in Asian Alcohol. 1991. Ultimately. they received individual notices of termination effective November 30. and Sendon were water pump tenders. To thwart further losses. In October. NLRC G. Prior Holdings took over its management and operation. Verayo was a briquetting plant operator while Tormo was a plant helper under him. 131108. Redundancy Asian Alcohol Corporation v.R. No. it is Prior Holding that will absorb all the losses. Seventy two (72) of them occupied redundant positions that were abolished. Prior Holdings took over the operations of Asian Alcohol in October 1991. The next month. The law gives the new management every right to undertake measures to save the company from bankruptcy. The six (6) private respondents are among those union members whose positions were abolished due to redundancy. Amacio was a machine shop mechanic. twenty one (21) were held by union members and fifty one (51) by non-union members. This procedure enables an employee to contest the reality or good faith character of the asserted ground for the termination of his services before the DOLE. 1992. March 25. the Parsons family. Martinez. Issue: Was the termination valid due to redundancy? Ruling: In the case at bar. We find that the . 1999 Facts: In September. the last quarter losses in 1991 were already incurred under the new management. Plain to see. 1992. including those incurred under the former owners of the company.Department of Labor and Employment (DOLE) at least one month before the intended date of termination. There were no signs that these losses would abate. They were incurred under the management of the Parsons family and continued to be suffered under the new management of Prior Holdings. Some one hundred seventeen (117) employees out of a total workforce of three hundred sixty (360) were separated. They were all assigned at the Repair and Maintenance Section of the Pulupandan plant. (hereinafter referred to as Prior Holdings). A redundant position is one rendered superfluous by any number of factors. He also enjoyed vacation leave with pay equivalent to P7. Wiltshire File Co. the company's security guard handed him a letter which formally informed him that his services were being terminated upon the ground of redundancy.00 a month. In this context. and (4) fair and reasonable criteria in ascertaining what positions are to be declared redundant and accordingly abolished.000. Their positions had to be declared redundant to cut losses. 82249 February 7.00 per year. Under these conditions. dropping of a particular product line previously manufactured by the company or phasing out of a service activity priorly undertaken by the business. he was informed by the President of petitioner Wiltshire that his services were being terminated. the employer must comply with the following requisites: (1) written notice served on both the employees and the Department of Labor and Employment at least one moth prior to the intended date of retrenchment. Retrenched were one hundred seventeen (117) employees. NLRC G. Private respondent maintains that he tried to get an explanation from management of his dismissal but to no avail. when private respondent again tried to speak with the President of Wiltshire.. as well as hospitalization privileges to the extent of P10. (2) payment of separation pay equivalent to at least one month pay or at least one month pay for every year of service whichever is higher. On 13 June 1985. upon private respondent's return from a business and pleasure trip abroad. such as overhiring of workers. Inc.187. decreased volume of business. Redundancy exists when the service capability of the work is in excess of what is reasonably needed to meet the demands on the enterprise..00 excluding commissions from sales which averaged P5. . On 18 June 1985. Seventy two (72) of them including private respondent were separated because their positions had become redundant. Inc. For the implementation of a redundancy program to be valid.50 per year. ("Wiltshire") from 16 March 1981 up to 18 June 1985. what may technically be considered as redundancy may verily be considered as retrenchment measures. No.reorganizational plan and comprehensive cost-saving program to turn the business around were nor designed to bust the union of the private respondent. he received a monthly salary of P14.000. the employer has no legal obligation to keep in its payroll more employees than are necessary for the operation of its business. v. As such.R.. (3) good faith in abolishing the redundant positions.375. Ong was the Sales Manager of petitioner Wiltshire File Co. 1991 Facts: Private respondent Vicente T. he continued. SMART entered into a joint venture agreement with NTT of Japan. The Court finds merit in petitioner's basic argument. January 28. Smart Communications. For that accomplishment. This was made known to the employees on February 27. Private respondent further contended that retrenching him could not prevent further losses because it was in fact through his remarkable performance as Sales Manager that the Company had an unprecedented increase in domestic market share the preceding year. Astorga enjoyed additional benefits. The Court was unable to sustain public respondent NLRC's holding that private respondent's dismissal was not justified by redundancy and hence illegal. what the letter was in effect saying was that because of financial losses. 1997 as District Sales Manager of the Corporate Sales Marketing Group/ Fixed Services Division (CSMG/FSD). a group life and hospitalization insurance coverage. In the first place.00. SMART launched an organizational realignment to achieve more efficient operations. retrenchment was necessary. 3 Thus. namely. In February 1998..6 Part of the reorganization was the outsourcing of the marketing and sales force. Incorporated (SMART) on May 8. on 21 October 1985. Thus. that letter also referred to the company having "incur[red] financial losses which [in] fact has compelled [it] to resort to retrenchment to prevent further losses". v. annual performance incentive equivalent to 30% of her annual gross salary. She was receiving a monthly salary of P33.650. a complaint before the Labor Arbiter for illegal dismissal alleging that his position could not possibly be redundant because nobody (save himself) in the company was then performing the same duties. and formed SMART-NTT . and a car plan in the amount of P455. we note that while the letter informing private respondent of the termination of his services used the word "redundant".000. he was promoted to Marketing Manager and was authorized by the President to hire four (4) Sales Executives five (5) months prior to his termination. Issue: Is the termination valid due to redundancy? Ruling: Turning to the legality of the termination of private respondent's employment. 2008 Facts: Regina M.R. Inc. No.00.Private respondent filed. Astorga (Astorga) was employed by respondent Smart Communications. Astorga G. As District Sales Manager. which retrenchment in turn resulted in the redundancy of private respondent's position. 1998. offered her a supervisory position in the Customer Care Department. 1998. Retrenchment . albeit always within the framework of existing laws. SMART failed to comply with the mandated one (1) month notice prior to termination. the Department of Labor and Employment was notified of the redundancy program only on March 6. the fundamental law also guarantees the right of the employer to reasonable returns for his investment. 1998. Accordingly. Indeed. SMART. out of our concern for those lesser circumstanced in life. effective April 3. Astorga received it on March 16. However. she was not recommended by SMART. this Court has inclined towards the worker and upheld his cause in most of his conflicts with his employer. 1998. This favored treatment is consonant with the social justice policy of the Constitution. 1998. reduce overhead costs and enhance prospects of economic gains. But while tilting the scales of justice in favor of workers. Astorga landed last in the performance evaluation. thus. Astorga’s division. Issue: Was there redundancy to justify the termination of Astorga? Ruling: The Court agrees with the CA that the organizational realignment introduced by SMART. but she refused the offer because the position carried lower salary rank and rate. The record is clear that Astorga received the notice of termination only on March 16.Multimedia. Incorporated (SNMI). But on March 3. SMART then conducted a performance evaluation of CSMG personnel and those who garnered the highest ratings were favorably recommended to SNMI. Likewise. Despite the abolition of the CSMG/FSD. SNMI agreed to absorb the CSMG personnel who would be recommended by SMART. 1998. nonetheless. which culminated in the abolition of CSMG/FSD and termination of Astorga’s employment was an honest effort to make SMART’s sales and marketing departments more efficient and competitive. Astorga continued reporting for work. SMART issued a memorandum advising Astorga of the termination of her employment on ground of redundancy. as aptly found by the CA. SMART abolished the CSMG/FSD. we sustain the reorganization and redundancy program undertaken by SMART. we must acknowledge the prerogative of the employer to adopt such measures as will promote greater efficiency.38 In this light. To soften the blow of the realignment. Since SNMI was formed to do the sales and marketing work. 199839 or less than a month prior to its effectivity on April 3. 1998.400 of its cabin crew personnel. to take effect on July 15. 178083.” PAL claims that the scheme resulted in “savings x x x amounting to approximately P24 million per month – savings that would greatly alleviate PAL’s financial crisis. including more than 1. While consultations between FASAP and PAL were ongoing. PAL admits that the retrenchment is wholly premised upon such reduction in fleet. their employment was made permanent and regular. No. However. PAL adopted the retrenchment scheme allegedly to cut costs and mitigate huge financial losses as a result of a downturn in the airline industry brought about by the Asian financial crisis. PAL retrenched 5. PAL adopted its so-called “Plan 14” whereby PAL’s fleet of aircraft would be reduced from 54 to 14.000 of its employees.Flight Attendants and Stewards Association of the Philippines (FASAP) v. the latter began implementing its retrenchment program by initially terminating the services of 140 probationary cabin attendants only to rehire them in April 1998. In implementing the retrenchment scheme. PAL claims to have incurred P90 billion in liabilities. Respondent PAL is a domestic corporation organized and existing under the laws of the Republic of the Philippines. During said period.” Prior to the full implementation of the assailed retrenchment program. Thus PAL unilaterally resolved to utilize the criteria set forth in Section 112 of the PAL-FASAP Collective Bargaining Agreement (CBA) in retrenching cabin crew personnel: that is. the parties failed to agree on how the scheme would be implemented. or collectively known as PAL cabin crew personnel. Issue: Was the termination valid due to retrenchment? Ruling: The burden clearly falls upon the employer to prove economic or business losses with sufficient supporting evidence. On June 15. PAL G. while its assets stood at P85 billion. 2008 Facts: Petitioner FASAP is the duly certified collective bargaining representative of PAL flight attendants and stewards. operating as a common carrier transporting passengers and cargo through aircraft. and to “the strike staged by PAL pilots since this action also translated into a reduction of flights. 1998. FASAP and PAL conducted a series of consultations and meetings and explored all possibilities of cushioning the impact of the impending reduction in cabin crew personnel. Its failure to prove these reverses or losses necessarily means that the employee’s dismissal was not . July 22.R. that retrenchment shall be based on the individual employee’s efficiency rating and seniority. Moreover. thus requiring the services of only 654 cabin crew personnel. justified. whichever is higher. AG & P ) terminated the services of 178 employees. that pursuant to Presidential Directive No. but substantial. (5) That the employer used fair and reasonable criteria in ascertaining who would be dismissed and who would be retained among the employees. Meaning of “retrenchment to prevent losses” Revidad v. private respondent Atlantic. the resolution of the instant petition hinges on a determination of the existence of the first. such as status. including herein petitioners. (2) That the employer served written notice both to the employees and to the Department of Labor and Employment at least one month prior to the intended date of retrenchment. are not merely de minimis. a complaint for illegal dismissal with prayer for reinstatement was filed by herein petitioners (except Jose Español) with public respondent. all of which must concur. Inc. under a redundancy program. serious. physical fitness. as a result of which they were reinstated on July 8. taking to mind that the burden of proof in retrenchment cases lies with the employer in showing valid cause for dismissal. 0191 2 issued on July 25. 1988. Any claim of actual or potential business losses must satisfy certain established standards. and. as well as compliance therewith by PAL. NLRC G. and financial hardship for certain workers. however. As a consequence. if already incurred. that legitimate business reasons exist to justify retrenchment. efficiency. 1991 and assigned to the Batangas plant of private respondent. fourth and the fifth elements set forth above. seniority. (hereafter. These cases were subsequently decided in favor of petitioners. These are: (1) That retrenchment is reasonably necessary and likely to prevent business losses which. before any reduction of personnel becomes legal. No. June 27. are reasonably imminent as perceived objectively and in good faith by the employer. The records show. actual and real. age. (3) That the employer pays the retrenched employees separation pay equivalent to one (1) month pay or at least one-half (½) month pay for every year of service. 1995 Facts: It appears that sometime in March. 1991 by the company's president and containing management's decision to . 111105.R. (4) That the employer exercises its prerogative to retrench employees in good faith for the advancement of its interest and not to defeat or circumvent the employees’ right to security of tenure. Gulf and Pacific Company of Manila. In view of the facts and the issues raised. or if only expected. proof of actual financial losses incurred by the company is not a condition sine qua non. for retrenchment. AG & P implemented and effected. the AG & P United Rank and File Association (URFA. the voluntary arbitrator considered this as an admission that indeed AG & P was actually experiencing adverse business conditions which would justify the exercise of its management prerogative to retrench in order to avoid the not so remote possibility of the closure of the entire business which. In its ordinary connotation. Hence. contrary to petitioners' asseverations. in other words. First. would in the last analysis be adverse to both the management and the union. which is resorted to by an employer primarily to avoid or minimize business losses. Second. Even the rank and file union at AG & P did not contest the fact that management had been undergoing financial difficulties for the past several years. the parties agreed to submit the legality of the lay-offs to voluntary arbitration. 14 These. Issue: Was there a need for retrenchment to prevent losses? Ruling: The Court is accordingly convinced. If such an intent were expressly written into the law. financial statements audited by independent external auditors constitute the normal and reliable method of proof of the profit and loss performance of a company. and so hold. which was the employees' union. Third. the voluntary arbitrator's conclusions were premised upon and substantiated by the audited financial statements and the auditor's reports of AG & P for the years 1987 to 1991. By reason thereof. for facility). the temporary lay-off of some 705 employees. in the opinion of the voluntary arbitrator. staged a strike. the phrase "to prevent losses" means that retrenchment or termination of the services of some employees is authorized to be undertaken by the employer sometime before the anticipated losses are actually sustained or realized.lay off 40% of the employees due to financial losses incurred from 19891990. 1991. the intention of the lawmaker to compel the employer to stay his hand and keep all his employees until after losses shall have in fact materialized. starting August 3. It is not. In a conciliation conference over the labor dispute held before the National Conciliation and Mediation Board on August 13. that law may well be vulnerable to . it has been sufficiently and convincingly established by AG & P before the voluntary arbitrator that it was suffering financial reverses. 1991. Retrenchment is one of the economic grounds to dismiss employees. that both the retrenchment program of private respondent and the dismissal of petitioners were valid and legal. 1996 Facts: On April 23. Wilberto Amparado and Fidel Manaog. including herein petitioners Juan Saballa. on “forced leave without pay for a period of three (3) months. 1988. priorities and effective dates under Memo No. 1988 granted authority to terminate the employment of the said 30 employees “pursuant to the categories.constitutional attack as unduly taking property from one man to be given to another. General Manager of the Camarines Sur III Electric Cooperative.” On June 20. (private respondent herein). The Regional Director in his Resolution dated June 6. 60-88 declaring some fiftytwo (52) employees.” The memo assured the subject employees of rehiring “as soon as the Coop shall have financially recovered/regained its financial viability expected within the above specified period. Arturo Margallo. NLRC G. Helen Quiambao.R. 24-88 providing for “austerity measures (retrenchment). 1988. Nos.” A copy of said memorandum was furnished the Regional Office of the DOLE in Legaspi City on June 23.” effective five (5) days after receipt by the employees concerned. Issue: Is the termination justified? Ruling: Given the preceding discussion. 1988. 102472-84. it is indisputable that private respondent failed to meet the abovestated requirements for a valid retrenchment due to imminent business losses. Best evidence of losses Saballa v. Lailani Miranda. private respondent filed with the Department of Labor and Employment’s Regional Office No. Nelia Ibarrientos. V in Legaspi City a Notice of Retrenchment covering some thirty (30) employees on the basis of the guidelines and priorities specified in the abovementioned memorandum. Inc. Margallo issued Memorandum No. (2) the expected losses were not shown to be imminent as private respondent was able to afford re-hiring of some of the non-tenurial employees on “forced leave”. issued Memorandum No. Such “forced leave” was purportedly part of the cost-saving measures instituted to enable the Coop “to meet (its) financial obligations especially with NPC and NEA. since (1) the expected losses were not proven to be substantial.” On the same date. August 22. 24-88. and (3) the retrenchment was . contrary to the public respondent’s finding. it is ineludible that we should agree with petitioners’ contention that. not to mention private respondent’s bad faith. This militates strongly against private respondent’s claim of good faith in implementing reductions of its work force to reduce costs. being regular employees. Article XI of the Collective Bargaining Agreement of September 13. This allegation. the retrenchment of petitioners by private respondent constituted illegal dismissal. but discarded these self-imposed criteria when it came to the retrenchment of petitioners. supported by the affidavit of petitioners’ witness Marlene Cerillo. neither the losses already realized nor the imminent losses sought to be forestalled were proven by sufficient and convincing evidence. the subject retrenchment is violative of this stipulation as well. the same was not applied to the petitioners. remained unrebutted and uncontroverted by private respondent. Further. it is undisputed that Sec. And. during the pendency of the complaints for illegal dismissal. when there were still a number of regular employees in the same situation. Thus.” Thus. 24-88 a set of criteria in retrenching employees in accordance with its cost-reduction program. we note that the termination was made effective five (5) days after receipt of notice. The private respondent adopted in its Memo No. although Memorandum No. 1. This Court has repeatedly enjoined employers to adopt and observe fair and reasonable standards to effect retrenchment. the private respondent admitted but failed to explain why it rehired previously retrenched employees who were even non-tenurial. Moreover. and who therefore ought not have been retrenched — at least not under said memorandum. The private respondent’s demonstrated arbitrariness in the selection of which of its employees to retrench is further proof of the illegality of the subject retrenchment. did not fall under any of the categories mentioned in said memorandum. And lastly. who. 1988 between private respondent and the employees’ union stipulates that “seniority in service to the company shall be x x x considered in lay-off or reduction of working force. private respondent hired replacements to fill their positions. thus rendering its action arbitrary. 24-88 set out the priorities/categories to be observed in implementing the personnel reduction program. Petitioners also alleged that. immediately after their termination. .not shown to be reasonably necessary and likely to effectively prevent the expected losses. And. The lack of the thirty (30) days notice prior to retrenchment as required under Article 283 of the Labor Code further bolster the conclusion that the subject retrenchment was illegal. The determination that the employee’s services are no longer necessary or sustainable and therefore properly terminable is an exercise of business judgment by the employer. Legend sent the 34 employees their respective notices of retrenchment. Thus. December 28. Retrenchment and redundancy are two different concepts. Flordeliza Maria Reyes Rayel. Jr. Hwa Puay. No. (2) completion of the temporary casino in Cubi by mid-February 1998. NLRC G. Issue: Whether or not redundancy is established in this case at bar? Ruling: The Court ruled that Legend failed to establish redundancy. 173231. and other corporate officers are impleaded in this case in their official capacities as officers of Legend. and (6) abolition of the Personnel and Administrative Department of the Project Development Division and transfer of its function back to Legend’s Human Resources Department. Bernaldo delos Santos. Legend explained that it would be retrenching its employees on a last-in-first-out basis on the strength of the updated status report of its Project Development Division. and Joven Pabustan were hired on various dates from 1995 up to 1997 and worked as architects. (3) subcontracting the super structure work of Grand Legend to a third party. 1998. and surveyors in the Subic Legend Resorts and Casino. 1998. Inc. as follows: (1) shelving of the condotel project until economic conditions in the Philippines improve. engineers. Vicente Mantala. operators. The declaration of redundant positions is a management prerogative. Jovencio Poblete. stating the same reasons for their retrenchment. in the Project Development Division.Redundancy vs. they are not synonymous and therefore should not be used interchangeably. On January 6. simply put. 2007 Facts: Petitioners Ruben Andrada.R. draftsmen.. (Legend) Project Development Division on various projects. The following day. Legend sent notice to the Department of Labor and Employment of its intention to retrench and terminate the employment of thirty-four (34) of its employees. Filamer Alfonso. (5) completion of the temporary casino in Cubi. Harvey Cayetano. The wisdom or soundness of this judgment is not subject to the discretionary . Retrenchment Andrada v. redundancy exists when the number of employees is in excess of what is reasonably necessary to operate the business. which include petitioners. (4) completion of most of the rectification work at the Legenda Hotel. on January 7. unfair labor practice and payment of 13th month pay. or an over supply of employees. They claimed that their dismissal was not based on any of the causes allowed by law. we held that the basis for retrenchment was not established by substantial evidence. petitioner terminated the employment of respondents on the ground that the operations of the F&B Department had been turned over to concessionaire Mother's Choice Meat Shop & Food Services..” According to the CA.review of the Labor Arbiter and NLRC. Closure or Cessation of Business Operations Eastridge Golf Club. Effective October 1. In Panlilio v. NLRC. Petitioner filed with the Department of Labor and Employment (DOLE) an Establishment Termination Report. draftsmen. 1999. petitioners’ termination from employment was illegal. job description and the approval by the management of the restructuring. Thus. explaining the reasons and necessities for the implementation of the redundancy program. Respondents filed with the National Labor Relations Commission (NLRC). we also rule that Legend failed to establish by the same quantum of proof the fact of redundancy. Regional Arbitration Branch. and interior designers. it was held that the company sufficiently established the fact of redundancy through “affidavits executed by the officers of the respondent PLDT. Petitioner denied respondents' claims.” In another case. It is however not enough for a company to merely declare that positions have become redundant. It must produce adequate proof of such redundancy to justify the dismissal of the affected employees. and that it was effected without due process. we said that the following evidence may be proffered to substantiate redundancy: “the new staffing pattern. feasibility studies/proposal. especially among architects. v. hence. The report further stated that there was duplication of functions and positions. 166760. 2008 Facts: Petitioner employed respondents as kitchen staff in its Food and Beverage (F&B) Department. a complaint for illegal dismissal. engineers. No. Labor UnionSuper G. Inc. pointing out that . Inc. on the viability of the newly created positions. stating that it laid off the respondents due to company reorganization/downsizing and transfer of operations to a concessionaire. August 22. in the same way.R. Legend proved the existence of redundancy when it submitted a status review of its project division where it reported that the 78-man personnel exceeded the needs of the company.. Eastridge Golf Club. to wit: a) that the closure/cessation of business is bona fide. It is carried out to either stave off the financial ruin or promote the business interest of the employer. it issued various office memoranda informing respondents that.e. Unlike retrenchment. it need not present evidence of financial losses to justify such business decision. the management decided to bid out a part of its operations. b) that written notice was served on the employees and the DOLE at least one month before the intended date of closure or cessation of business. the cause invoked by petitioner in terminating the employment of respondents is not retrenchment but cessation of a single aspect of its business undertaking. the exercise of which no court or tribunal can meddle with. In the case under review. regardless of the underlying reasons and motivations therefor. in the various office memoranda it posted.. petitioner explained that the underlying reason for the cessation of its F&B undertaking was that the economic depression had affected its sales and operations and resulted in increased overhead expenses and decreased incomes. Article 283 authorizes termination of employment due to business closure. petitioner's cessation of its F&B operations was not a valid cause to terminate the employment of respondents. This is evident in the notices of termination it sent to respondents where petitioner indicated that it had withdrawn from the direct operation of the F&B Department and had transferred the management thereof to the concessionaire. and c) in case of closure/cessation of business not due to financial . the F&B Department. specifically the F&B Department. for lack of evidence of financial losses. to a concessionaire. as an authorized cause of termination of employment. Thus. Cessation of its F&B operations being the cause invoked by petitioner to terminate the employment of respondents.. Also. i. the Court agrees with petitioner that the CA erred when it declared that. i. be it financial losses or not. Issue: Was there a valid cessation to justify the dismissal of n employee? Ruling: Closure or cessation of business is the complete or partial cessation of the operations and/or shut-down of the establishment of the employer.e. The partial cessation of operations was bonafide.several months before their dismissal. need not depend for validity on evidence of actual or imminent reversal of the employer's fortune. 283. to minimize company losses. closure or cessation of business. except only when the employer fails to prove compliance with the requirements of Art. The decision to close business is a management prerogative exclusive to the employer. its purpose is to advance the interest of the employer and not to defeat or circumvent the rights of employees under the law or a valid agreement. 1989 or thirty (30) days thereafter. 1989.e. whichever is higher. to wit: a) that the closure/cessation of business is bona fide. ITC decided to permanently stop and close its veneer production at its Butuan Logs Plant “due to impending heavy financial losses resulting from high production costs.losses. ITC served a written notice to all its employees in the said plant and to the Butuan District Office of the Department of Labor and Employment (DOLE) stating that effective December 10. No. the exercise of which no court or tribunal can meddle with. filed a formal objection to the intended shutdown. NLRC G.. Both plants occupied a single compound with a common point for ingress and egress and were both leased from Industrial Plywood Group Corporation. b) that written notice was served on the employees and the DOLE at least one month before the intended date of closure or cessation of business. 1997 Facts: Industrial Timber Corporation (ITC) is a corporation registered under Philippine laws and is engaged in the business of manufacturing and processing veneer and plywood products. on November 9. 283. June 10. and c) in case of closure/cessation of business not due to financial losses. whichever is higher. except only when the employer fails to prove compliance with the requirements of Art. ITC Butuan Logs Workers Union-WATU (Union) represented the rank and file employees of the Butuan Logs Plant. through their union representative. Sometime in 1989. Industrial Timber Corporation v. Both plants had also two (2) distinct bargaining units represented by separate labor unions and had separate collective bargaining agreements with their respective principals. The decision to close business is a management prerogative exclusive to the employer. that the employees affected have been given separation pay equivalent to ½ month pay for every year of service or one month pay.R. Consequently. It used to operate a veneer processing plant known as the Butuan Logs Plant and a veneer and plywood processing plant known as the Stanply Plant. i.” Accordingly. 107302 and 107306. After receiving the notice. conciliation proceedings were conducted at the DOLE District Office pursuant to the provisions of the . its purpose is to advance the interest of the employer and not to defeat or circumvent the rights of employees under the law or a valid agreement. the employees therein. it would cease operations at said plant. that the employees affected have been given separation pay equivalent to ½ month pay for every year of service or one month pay. erratic supply of raw materials and depressed prices and market conditions for its wood products. Unfortunately. as no business or undertaking must be required to continue operating at a loss simply because it has to maintain its workers in employment. the fact that petitioner company has ceased operations and has not resumed to do so only reinforces its claim to a valid closure. not to mention the other established fact that its Stanply Plant has also the capacity and capability to produce veneer. with a fraction of at least six (6) months to be considered one (1) whole year. recognized as a valid exercise of management prerogative. The records bear out that petitioner had sufficiently complied with the aforecited requirements. however. 1989. petitioner corporation complied with the requirements mandated by law to effectuate valid termination of employment on account of closure. Issue: Was there an established valid cessation? Ruling: Article 283 of the Labor Code clearly provides inter alia that the employer may terminate the employment of his employees to prevent losses. Under the law. not past or actual ones. showing in detail the imminent losses it would suffer should it continue its operations. only 63 employees availed of the benefits. The employees were. The foregoing notwithstanding.Collective Bargaining Agreement (CBA) on grievances. Closure or cessation of operations for economic reasons is. The parties. likewise. whichever is higher. the burden of proving that such closure is bona fide falls upon the employer. for an employer to validly terminate the service of his employees under the aforesaid ground. 1989 in a Letter dated November 9. namely: (a) serving a written notice on the workers and the DOLE at least one (1) month before the effective date of the closure and (b) payment of separation pay equivalent to one (1) month pay or at least one-half (1/2) month pay for every year of service. failed to settle their differences. . petitioner corporation presented the analysis of an independent certified public accountant. It informed its employees and the DOLE District Office at Butuan of the termination of service of the employees effective December 10. Moreover. the product it solely manufactured in its now closed plant. therefore. The rest chose to file the instant action. he has to comply with two (2) requirements. informed of the availability for release of the funds for their separation pay and other CBA benefits. Such an act would be tantamount to a taking of property without due process of law. In this case. However. It is understandable that no audited financial statements or other similar documents were presented as the company is claiming impending future losses. The determination to cease operations is a prerogative of management which the State does not usually interfere with. NLRC. armed with a certification from his physician that he was “fit to work. on 20 June 2000. Recto. No. Pula was advised by his attending physician to take a leave of absence from work and rest for three (3) months. Subsequently. Upon his discharge from the hospital. “it is only where there is a prior certification from a competent public . Paul Lee. who advised him to take a twoweek leave from work. suffered a heart attack and was rushed to the hospital. respondent was certified as “fit to work” by Dr. on 25 February 2000. Pula claimed that he was not given any post or assignment.Disease or illness Crayons Processing. where he was confined for around a week. but 13 days later. 2007 Facts: Petitioner Crayons Processing. (Crayons) employed respondent Felipe Pula (Pula) as a Preparation Machine Operator beginning June 1993. he was taken to the company clinic after complaining of dizziness.. but instead. the dismissal must necessarily be declared illegal. Clothman Knitting Corp. and Ellen Caluag. Pula. Issue: Was the dismissal valid on account of illness? Ruling: For a dismissal on the ground of disease to be considered valid. Diagnosed as having suffered a relapse. The burden falls upon the employer to establish these requisites and in the absence of such certification. Following the angiogram procedure. two requisites must concur: (a) the employee must be suffering from a disease which cannot be cured within six months and his continued employment is prohibited by law or prejudicial to his health or to the health of his coemployees. Nixon Lee. v. Recto. and (b) a certification to that effect must be issued by a competent public health authority. he was advised by his physician to take a leave of absence from work for one (1) month. On 27 November 1999.000 as financial assistance. 5 days service incentive leave pay. then aged 34. Pula returned to work. he was asked to resign with an offer from Crayons of P12. On 11 April 2000.. Inc.R. Pula G. July 30. and 13th month pay for 1999. 167727. Inc. Pula’s wife duly notified Crayons of her husband’s medical condition. The complaint was filed against Crayons. Pula reported back for work on 13 June 2000. Peter Su.” However. Pula refused the offer and instead filed a complaint for illegal dismissal with prayer for damages and the payment of holiday premium. Pula underwent an Angiogram Test at the Philippine Heart Center under the supervision of a Dr. As succinctly stressed in Tan v. Granting reinstatement. 1978 on a probationary period of employment for six (6) months with petitioner CRP. otherwise. as required by the regulations then in force. the characterization or even diagnosis of the disease would primarily be shaped according to the interests of the parties rather than the studied analysis of the appropriate medical professionals. to wit.R. No. The alleged ground for his removal. “pulmonary tuberculosis minimal.authority that the disease afflicting the employee sought to be dismissed is of such nature or at such stage that it cannot be cured within six (6) months even with proper medical treatment that the latter could be validly terminated from his job. L-58639. it would sanction the unilateral and arbitrary determination by the employer of the gravity or extent of the employee's illness and thus defeat the public policy in the protection of labor. he was informed of the termination of his employment by respondent since his illness was not curable within 6 months. the public respondent argues that Pilones was already a permanent employee at the time of his dismissal and so was entitled to security of tenure. The requirement of a medical certificate under Article 284 cannot be dispensed with. Competent Public Health Authority Cebu Royal Plant v. for the termination of his employment. August 12. The dismissal was reversed by the public respondent who ordered the reinstatement and payment of back wages. was employed on February 16. he underwent medical examination for qualification as regular employee but the results showed that he is suffering from PTB minimal. Minister of Labor G. private respondent. Issue: Was the dismissal proper? . 1987 Facts: Ramon Pilones. CRP claims that the private respondent was still on probation at the time of his dismissal and so had no security of tenure.” was not certified as incurable within six months as to justify his separation and that the petitioner should have first obtained a clearance. Pilones complained against his termination before the Ministry of Labor which dismissed the same. The dismissal was necessary for the protection of the public health. as he was handling ingredients in the processing of soft drinks which were being sold to the public. After said period. Consequently.” Without the required certification. It is also worth noting that the petitioner’s application for clearance to terminate the employment of the private respondent was filed with the Ministry of Labor only on August 28. the prior clearance rule (which was in force at that time) was not a “trivial technicality. Rule I. Book VI. and the results were not immediately available. February 15.31 a day.” It required “not just the mere filing of a petition or the mere attempt to procure a clearance” but that “the said clearance be obtained prior to the operative act of termination.Ruling: No. As such. His duties. this must be conditioned on his fitness to resume his work. 84193. he could validly claim the security of tenure guaranteed to him by the Constitution and the Labor Code. 1990 Facts: The complainant was employed in December 1977 by the respondent with the salary of P37. dismissal was illegal. Hence. We note that when the petitioner had all of six months during which to conduct such examination. were to verify and check incoming materials and supplies and issuing requisitioned materials and supplies to authorized personnel of the . Under Article 282 of the Labor Code. He was assigned in the Materials and Supply Section.” The record does not contain the certification required by the above rule. 1978. Procedural due process 1) Procedure to be observed in just causes termination Twin-Notice Rule Ruffy v. NLRC G. The petitioner claims it could not have dismissed the private respondent earlier because the x-ray examination was made only on August 17. 1978.R. 1978. it chose to wait until exactly the last day of the probation period. That excuse is untenable. The dismissal was not proper. or seven days after his dismissal. No. of the Rules and Regulations Implementing the Labor Code which states that “the employer shall not terminate his employment unless there is a certification by a competent public health authority that the disease is of such nature or at such a stage that it cannot be cured within a period of six (6) months even with proper medical treatment. Supply and Warehousing Department of the respondent. The applicable rule on the ground for dismissal invoked against him is Section 8. As the NLRC has repeatedly and correctly said. or four days after he ceased to be a probationer.” Pilones was already on permanent status when he was dismissed on August 21. among others. “an employee who is allowed to work after a probationary period shall be considered a regular employee. Although we must rule in favor of his reinstatement. as certified by competent authority. before dismissal may be validly effected. The Court has held that the procedure under Batas Blg. Respondent Mamac was hired as bus conductor of Don Mariano Transit Corporation (DMTC) on April 29. 1984. Mamac G. the petitioner was informed that his services had been terminated. June 29. Respondent was required to accomplish a “Conductor’s Trip Report” and submit it to the company after each trip. No. 2007 Facts: Petitioner KKTI is a corporation engaged in public transportation and managed by Claire Dela Fuente and Melissa Lim. prior to investigation. Issue: Was the procedure for dismissal proper? Ruling: The law lays down the procedure prior to the dismissal of an employee. hearing and judgment. complainant issued twenty-five (25) sets of roller bearings valued at P15.S. In the case at bar. if an opportunity it was. yet the stubborn fact remains that notwithstanding such an opportunity. 166208. on December 31. gross negligence and flagrant inefficiency with forfeiture of all rights and privileges.. 1984. Jr.I. It need not be observed to the letter. Once an irregularity is discovered. 1999. an employee of the respondent whose employment was terminated in connection with this case.00 covered by Material Issue Slip (M. the company issues an “Irregularity . this report indicates the ticket opening and closing for the particular day of duty. As a background. Role on his part denied having received said bearings. In the process.) No. was the same person who received said bearings. complainant answered that he could not remember. The KKTI employees later organized the Kaisahan ng mga Kawani sa King of Kings (KKKK) which was registered with DOLE. In reply. In the investigation that ensued. that is. there is no doubt that at the very outset.650. On November 3. After submission. Inc. 130 and the rules implementing it are conditions sine qua non. it must be done in the natural sequence of notice. 121676 to a person who signed his name as Role.R. the company audits the reports. Respondent was elected KKKK president. King of Kings Transport. v. but at least.250 by Anastacio Maulleon. it is true. he had been dismissed from the firm. the complainant was asked whether Alfredo Role. it was gathered by the respondent that the bearings were sold to factoria de Nasugbu for P8. also an employee of respondent. Consequently..various departments. He was made to air his side subsequently. These bearings were never received by the requisitioning section concerned. the complainant was dismissed from the service for breach of trust. respondent received a letter terminating his employment effective November 29. In Pepsi Cola Bottling Co. Second.. Also. indicating the nature and details of the irregularity. In his letter.Report” against the employee. in Loadstar Shipping Co. Likewise. even assuming that petitioner KKTI was able to furnish respondent an Irregularity Report notifying him of his offense. 2001 incident. respondent said that the erroneous declaration in his October 28. Thereafter. A verbal appraisal of the charges against an employee does not comply with the first notice requirement. It discovered that respondent declared several sold tickets as returned tickets causing KKTI to lose an income of eight hundred and ninety pesos. sanctioning the employer for disregarding the due process requirements. First. 2001. 2001 irregularity was an act of fraud against the company. the Court. KKTI nevertheless asked respondent to explain the discrepancy. the Court held that consultations or conferences are not a substitute for the actual observance of notice and hearing. v. 2001 Conductor’s Report of respondent. After considering the explanation of the employee. He explained that during that day’s trip. respondent was not issued a written notice charging him of committing an infraction. 2001. v. such would not comply with the requirements of the law. The reports did not even state a company rule or policy that the employee had allegedly violated. The law is clear on the matter. the concerned employee is asked to explain the incident by making a written statement or counter-affidavit at the back of the same Irregularity Report. NLRC. 2001 Trip Report was unintentional. there is no mention of any of the grounds for termination of employment . he got confused in making the trip report. the company then makes a determination of whether to accept the explanation or impose upon the employee a penalty for committing an infraction. As a result of the incident. That decision shall be stated on said Irregularity Report and will be furnished to the employee. KKTI noted an irregularity. We observe from the irregularity reports against respondent for his other offenses that such contained merely a general description of the charges against him. The dismissal letter alleged that the October 28. Inc. and they had to cut short the trip in order to immediately report the matter to the police. held that the employee’s written explanation did not excuse the fact that there was a complete absence of the first notice. On November 26. Upon audit of the October 28. the windshield of the bus assigned to them was smashed. Issue: Was there compliance with the procedural due process for dismissal? Ruling: None. While no irregularity report was prepared on the October 28. Mesano. private respondent claimed that he was not given the opportunity to be heard and was summarily dismissed. 1999 Facts: Private Respondent filed a complaint before the Arbitration Branch of the Department of Labor and Employment (DOLE) for an illegal dismissal by herein petitioner. Aggrieved with the decision private respondent appealed to the NLRC which ordered reinstatement to complainant to its former position with his seniority rights. 516. a hearing was still necessary in order for him to clarify and present evidence in support of his defense. no hearing was conducted. The Labor arbiter’s decision upheld the print-out attached by petitioner as evidence and promulgated a resolution ordering petitioner to pay private respondent salary from June 1 to August 31. Thus. . he was surprised to receive the November 26. this petition. NLRC G. respondent made the letter merely to explain the circumstances relating to the irregularity in his October 28.R. but also his previous infractions. Petitioner attached to its position papers copies of print-outs which allegedly contains computer message/entries sent by petitioner to private respondent thru IBM’s internal computer system. not only his October 28. Prior to the release of the labor arbiter’s decision private respondent filed a “Motion to admit attached new evidence for the complainant”. Regardless of respondent’s written explanation. Moreover. 65 a month including all its benefits and bonuses. KKTI’s “standard” charge sheet is not sufficient notice to the employee. it also pointed out that as an employee of IBM they are assigned ID’s and passwords. backwages from August 31. April 13. Hence. Petitioner contend that he was given a chance or warning to improve his attitude toward attendance but never did. Through this computer print-outs petitioner sought to prove that private respondent was sufficiently notified of the charges and was guilty thereof for failure to deny the same.under Art. 2001 Conductor’s Trip Report. 2001 infraction. 2001 termination letter indicating as grounds. 1990 in the amount of P40. 282 of the Labor Code. No. IBM Philippines v. He was unaware that a dismissal proceeding was already being effected. 1990 excluding all benefits. 117221. Thus. and was duly informed thru emails. employees may also respond/reply thru email by encoding his messageresponse and admits also that the system automatically records the time and date of each message was sent or received including the identification of the sender and the receiver thereof. Third. he found respondents liable for refusal to work penalized by dismissal from the service considering that they committed the same offense for the second time. 2006 Facts: Asian Terminals. Jr. respondents and other stevedores. Article 22 of the Labor Code which states that “…DUE PROCESS MUST NEVER BE SUBORDINATED TO EXPEDIENCY OR DISPATCH” Administrative Hearing Asia Terminals. Respondents are employees as stevedores of Asian Terminals. . however. On September 23. August 10. The evidence presented before us must be at least have a modicum of admissibility for it to be given some probative value. were assigned to unload the cargo of the M/V Huang Jin Shua. The liberal view in the conduct of proceedings before administrative agencies. 1994. the liberality of procedure in administrative actions is subject to limitations imposed by basic requirements of due process. (Asian Terminals) petitioner. have nonetheless consistently required some PROOF OF AUTHENTICITY OR RELIABILITY as condition for the admission of documents. The computer print-outs..Issue: Did NLRC commit grave abuse of discretion in holding that no just cause or due process was observed in dismissing private respondent because computer print-outs are inadmissible in evidence? Ruling: Petitioner contend that in administrative /labor cases the technical rules on evidence are not binding hence. The procedural technicality and concerns are more paramount principles and requirements of due process. Inc. v. the computer print-outs need not be identified nor authenticated. 149074. 1994. Marbella G. who formed one group. It is not disputed that early in the evening of April 30. afford no assurance of their authenticity since they are unsigned. Inc. Salazar of Asian Terminals Legal Department conducted an investigation of the incident. also a petitioner. same reason why private respondent was allowed to submit additional evidences even after the case was deemed submitted for resolution. Rodolfo G. However. Officer-in-charge R. Corvite.F. have opposing versions of what transpired next. In his report and investigation dated May 15. The work of the group could not be completed if one stevedore was absent.. is a domestic corporation and the exclusive provider of arrastre and stevedoring services at the Manila South Harbor.R. is its President. The parties. 1994. which may not be sacrificed to speed or expediency. No. this procedural rule should not be construed as a license to disregard certain fundamental evidenciary rules. which constitute only evidence of petitioners. Settled is the rule that in an illegal dismissal case. sales lady. On December 14. The offense of willful disobedience requires the concurrence of two (2) requisites: (1) the employee’s assailed conduct must have been willful. in its Decision dated November 26. It was an officer of Asian Terminals who ordered respondents to stop working when no personnel could replace the absent employee. On appeal. NLRC G. petitioner constrained to stop its business and consequently terminate its contract with the three (3) manpower service companies.R. Private respondents were part of a pool of workers supplied by three (3) manpower service companies under "labor-only" contracts. Asian Terminals filed a motion for reconsideration. lawful. July 26. . private respondents had worked in the Shoppers Gain Supermarket in various capacities as "merchandiser. On appeal. 1996 Facts: From 1982 to 1990. Petitioner was able to pay separation pays for its regular employees but not for private respondents. the National Labor Relations Commission affirmed said decision. A complaint for illegal dismissal was filed for which the Labor Arbiter rendered a decision finding Shoppers Gain Supermarket guilty of labor-only contracting and ordered it to pay separation pay and backwages to respondents. respondents filed with the Arbitration Branch of the National Labor Relations Commission (NLRC) a complaint for illegal dismissal. but it was denied by the NLRC. Shoppers Gain Supermart v. bagger. the onus probandi is on the employer to prove that the dismissal of an employee is for a valid cause. In December of 1990. the NLRC. that is characterized by a wrongful and perverse attitude. In this case. made known to the employee and must pertain to the duties which he had been engaged to discharge. we agree with the Court of Appeals that Asian Terminals failed to prove willful disobedience on the part of respondents. Asian Terminals cited as a just cause respondents’ willful disobedience or refusal to work. Impleaded as respondents were herein petitioners. check-out personnel. printer/film and warehouseman" for at least one year each. cashier. due to an unavoidable circumstance. 1994.respondents were dismissed from the service. Asian Terminals then seasonably filed a petition for certiorari with this Court. No. Its own Position Paper states that they did not refuse to work. Issue: Was the dismissal proper? Ruling: Here. 1997. The NLRC found that respondents were denied due process and that they did not refuse to work. reversed the Labor Arbiter’s judgment. and (2) the order violated must have been reasonable. 110731. Lucia Realty and Development. The former clearly defines what constitute labor-only contractor as differentiated from a direct contractor. Night Hawk Security and Investigation Agency. and (b) Since the manpower agencies themselves admitted per their respective position papers that they selected. Inc. private respondents are considered employees of petitioner Shoppers Gain Supermart. dismissed and controlled the private respondents. while the latter is merely for the purpose of determining whether or not an employee is considered regular. (3) the power of dismissal. it followed that the latter are not the employees of the petitioner corporation but of the agencies only. (SLRDI) as the General Manager of SLRDI’s sister companies. Inc. Issue: Was the dismissal illegal? Ruling: The Supreme Court held that what was controlling in the issue is the provisions of Artcile 106 of the Labor Code and not that of Article 208.S. Based on the provision of Article 106. cashiers. both organized to service the malls and subdivisions owned by SLRDI. March 10.. NLRC G. petitioners raised the following grounds inter alia: (a) That for employer-employee to exist.R. (2) the payment of wages. In connection with this. 154308. Caingat v. necessary and vital to the day-to-day operations of the supermarket and that their jobs involved normal and regular functions in the ordinary business of the petitioner corporation. R. Caingat was hired by respondent Sta.S. warehousemen and so forth were directly related. he was allowed to use 10% of the total payroll of respondent R. No. baggers. Later. paid. and R. Maintenance to defray operating expenses. the Finance Manager discovered that petitioner deposited company funds in the latter’s personal account and used the funds . Maintenance and Services Inc. check-out personnel. sales ladies. and (4) the power to control employees' conduct. the following requirements must be satisfied. hired. namely: (1) selection and engagement of the employees. Consequently. the Supreme Court ruled that the petitioner was indeed the direct employer of private respondents and was therefore 0bliged to pay them separation pay.S. disciplined.Elevating the case to the Supreme Court. the provision of Article 106 clearly applied thus making the manpower agencies merely agents of petitioner corporation. The Supreme Court reasoned that since it is undeniable that the private respondents' work as merchandisers. 2005 Facts: Petitioner Benardino A. including the legal effects of each. NLRC G. Maintenance filed a complaint for sum of money and damages with prayer for writ of preliminary attachment. 000.000. or care and protection of the employer’s property. Thus. The respondents only sent the first notice. utility bills. loss of trust and confidence as a just cause for termination of employment is premised on the fact that an employee concerned holds a position where greater trust is placed by management and from whom greater fidelity to duty is correspondingly expected. Without conducting any investigation.M. 1989 Facts: Private respondent was hired by petitioner on January 18. as a result of which he and Barrameda were suspended on the following morning and in the afternoon of the same day a memorandum was issued by the Operations Manager advising private respondent of his dismissal from the service in accordance with their Personnel Manual. handling. Private respondents had every right to dismiss petitioner. respondent R. Nonetheless. Petitioner in turn filed a complaint for illegal dismissal against the respondents. The betrayal of this trust is the essence of the offense for which an employee is penalized. the management failed to observe fully the procedural requirement of due process for the termination of petitioner’s employment. Petitioner’s long period of disappearance from the scene and departure for abroad before making a claim of illegal dismissal does not contribute to its credibility. No. complainant received a memorandum stating that upon verification of financial records. on May 20. Management’s loss of trust and confidence on petitioner was well justified. while dismissal may truly be justified by loss of confidence. The .R.00 and is hereby suspended from his duties as Manager of the stated companies. such as the custody. 80587. At about 2:30 P. Wenphil Corporation v. He thereafter became the assistant head of the Backroom department of the same branch. trips abroad and acquisition of a lot in Laguna.to pay his credit card purchases. Issue: Did respondents illegally dismiss petitioner? Ruling: As firmly entrenched in our jurisprudence. Job Barrameda. 1985 private respondent had an altercation with a co-employee. February 8. gleaned from the memorandum. it was found that the latter have misappropriated company funds in the sum of about P5. Two notices should be sent to the employee. This includes managerial personnel entrusted with confidence on delicate matters. 1984 as a crew member at its Cubao Branch.S. There was no second notice. The second call was also unanswered. the case was submitted for resolution. The call was unanswered. a fellow telephone operator. she immediately placed it inside the machine which stamped the date “February 15. When petitioner saw that the second RLDC form was not time-stamped. After a search. 1985. 1998 Facts: Petitioner Rosario Maneja worked with private respondent Manila Midtown Hotel beginning January.00 inserted in the guest folio while the second deposit was eventually discovered inside the folder for cancelled calls with deposit and official receipts. NLRC G. No. In the afternoon of February 13.notice of dismissal was served on private respondent on May 25. Loleng passed on the RLDC to petitioner for follow-up.” Realizing that the RLDC was filed 2 days .00 from a page boy of the hotel for a call by a Japanese guest named Hirota Ieda. On February 15. She was a member of the National Union of Workers in Hotels. Rowena Loleng received a Request for Long Distance Call (RLDC) form and a deposit of P500. 1985 as a telephone operator. 1990.R. Restaurants and Allied Industries (NUWHRAIN) with an existing Collective Bargaining Agreement (CBA) with private respondent. Thus private respondent filed a complaint against petitioner for unfair labor practice. After submitting their respective position papers to the Labor Arbiter and as the hearing could not be conducted due to repeated absence of counsel for respondent. Petitioner monitored the call. 1990. 124013. In the evening. In its bare minimum due process of law simply means giving notice and opportunity to be heard before judgment is rendered. The standards of due process in judicial as well as administrative proceedings have long been established.00 deposit made by Ieda. The P500. Ieda again made an RLDC and the page boy collected another P500. illegal suspension and illegal dismissal. Issue: Was there compliance with the procedural due process for dismissal? Ruling: The failure of petitioner to give private respondent the benefit of a hearing before he was dismissed constitutes an infringement of his constitutional right to due process of law and equal protection of the laws. June 5. Loleng found the first deposit of P500.00 which was also given to the operator Loleng. a hotel cashier inquired about the P1. 1986 dismissing the complaint for lack of merit.000. Maneja v.00 deposit was forwarded to the cashier. Thereafter a decision was rendered by the Labor Arbiter on December 3. 1990. 1990. as divesting the Labor Arbiter of jurisdiction in a termination dispute. 372)” THE Court finds that the respondent Commission has erroneously interpreted the aforequoted portion of our ruling in the case of Sanyo. They shall establish a machinery for the adjustment and resolution of grievances arising from the interpretation or implementation of their Collective Bargaining Agreement and those arising from the interpretation or enforcement of company personnel policies. Moreover. 1990. a written report was submitted by the chief telephone operator. petitioner was served a notice of dismissal effective April 1. with the recommendation that the offenses committed by the operators concerned covered violations of the Offenses Subject to Disciplinary Actions (OSDA): (1) OSDA 2. Cañizares. 1990.earlier. 1990.01: forging.” the jurisdiction of which pertains to the grievance machinery or thereafter. Petitioner and Loleng thereafter submitted their written explanation.00 by Ieda was later returned to him. to a panel of voluntary arbitrators outlined in CBAs does not only include grievances arising from the interpretation or implementation of the CBA but applies as well to those arising from the implementation of company personnel policies. The second deposit of P500. 211 SCRA 361.’ (Sanyo v. Petitioner refused to sign the notice and wrote therein "under protest. No other body shall take cognizance of these cases.” Article 260 further provides that the parties to a CBA shall name or designate their respective representative to the grievance . Loleng then delivered the RLDC and the money to the cashier. On March 20. and (2) OSDA 1. It is to be stressed that under Article 260 of the Labor Code. to a voluntary arbitrator or panel of voluntary arbitrators." Issue: Whether or not the Labor Arbiter has jurisdiction over the illegal dismissal case.11: culpable carelessness negligence or failure to follow specific instruction(s) or established procedure(s). which explains the function of the grievance machinery and voluntary arbitrator. she wrote and changed the date to February 13. Ruling: The procedure introduced in RA 6715 of referring certain grievances originally and exclusively to the grievance machinery. “(T)he parties to a Collective Bargaining Agreement shall include therein provisions that will ensure the mutual observance of its terms and conditions. and when not settled at this level. falsifying official document(s). On March 23. the dismissal of petitioner does not fall within the phrase “grievances arising from the interpretation or implementation of collective bargaining agreement and those arising from the interpretation or enforcement of company personnel policies. x x x. It can deduced that only disputes involving the union and the company referred to the grievance machinery or voluntary arbitrators. interference and intimidation committed by [petitioner] company GLAXO-WELLCOME prior to and during the conduct of the certification elections. It argued that the suspension and dismissal were effected without any prior hearing. GLAXO-WELLCOME. No. Issue: Did petitioner observe due process in dismissing the employees? . resulted in a stand-off or a tie between ‘NO UNION’ and ‘NEW-DFA’. NagkakaisangxEmpleyadongWellcome-DFA G. 1990. 1990. [respondent] union NAGKAKAISANG EMPLEYADO NG WELLCOME-DFA (NEW-DFA) filed a Petition for Certification Election with the DOLE-NCR seeking to represent the bargaining unit comprised of all the regular rank-and-file employees of [petitioner] company GLAXO-WELLCOME.machinery and if the grievance is unsettled in that level.R. NEW-DFA likewise averred that the new Car Allocation Policy adopted by the company was intended to harass. March 11. As a consequence thereof. Acting upon such petition. The election. [Respondent] union also challenged the legality of the suspension and dismissal of two of its officers. NEW-DFA filed an election protest with the Medarbitration Branch of the Department of Labor and Employment. however. According to the [respondent] union. Jossie De Guzman and Norman Cerezo lodged a complaint before the Labor Arbiter against [petitioner] company. the ‘massive electioneering and manipulative acts’ of GLAXO-WELLCOME prior to and during the certification election unduly interfered with the workers’ right to self-organization and are constitutive of unfair labor practice. Inc. 149349. illegal dismissal and illegal suspension. v. for unfair labor practice. retaliate and discriminate against union officers and members. automatically be referred to the voluntary arbitrators designated in by the parties to a CBA of the union and the company. namely: Norman Cerezo and Jossie Roda de Guzman. Perceiving the enumerated events to be unduly oppressive to labor. it shall advance thus be shall be Eastern Overseas Employment Center. the Med-Arbiter ordered that a Certification Election be conducted on September 10. 2005 Facts: On July 20. [respondent] union NEW-DFA. [Respondent] union claimed that its failure to obtain the required majority vote can be ascribed to several acts of manipulation. 1984 as a crew member at its Cubao Branch. No. The only question to be determined is whether the notice and hearing requirements were complied with. the Labor Code and related laws. from receipt of the first notice. must come only after the employee has been given a reasonable period. if the dismissal is based on a just cause under Article 282 of the Labor Code. To stress. En Banc Facts: Private respondent was hired by petitioner on January 18. within which to answer the charge. The notices to be given and the hearing to be conducted generally constitute the two-part due process requirement of law that the employer must accord the employee. on May 20. The notice of dismissal was served on private respondent on May 25. the Court held that this requirement was “not a mere technicality but a requirement of due process to which every employee is entitled to insure that the employer’s prerogative to dismiss or lay-off is not abused or exercised in an arbitrary manner. and ample opportunity to be heard with the assistance of counsel. In Kingsize Manufacturing Corporation v. an opportunity to be heard). however. as a result of which he and Barrameda were suspended on the following morning and in the afternoon of the same day a memorandum was issued by the Operations Manager advising private respondent of his dismissal from the service in accordance with their Personnel Manual.M. 1989. Thus private respondent filed a complaint against petitioner for unfair labor practice. which is enshrined in the Constitution. The second notice is intended to inform the employee of the employer’s decision to dismiss. He thereafter became the assistant head of the Backroom department of the same branch.Ruling: The CA affirmed the findings of the labor arbiter and the NLRC that the termination of the employment of De Guzman and the suspension of Cerezo were based on a “just cause. Job Barrameda. NLRC G. After submitting their .R. The twin requirements of (a) two notices and (b) hearing are necessary to protect the employee’s security of tenure. 80587 February 8. NLRC.” Development of Doctrines Wenphil Corporation v. The first notice is intended to inform the employee of the employer’s intent to dismiss and the particular acts or omissions for which the dismissal is sought. 1985. illegal suspension and illegal dismissal. 1985 private respondent had an altercation with a co-employee. the employer must give the employee (1) two written notices and (2) a hearing (or at least.” These findings are not at issue here. if the employee so desires. At about 2:30 P. This decision. He presented his position paper as did the petitioner. The Court is bound by this finding of the labor arbiter. No. The motion is opposed by petitioner. The labor arbiter concluded that the dismissal of private respondent was for just cause. 2 The standards of due process in judicial as well as administrative proceedings have long been established.employees and supervisors is without merit. The basic requirement of due process is that which hears before it condemns. Kycalrâ In support . 1986 dismissing the complaint for lack of merit. However. which proceeds upon inquiry and renders judgment only after trial.R. it was the fault of private respondent as his counsel failed to appear at the scheduled hearings. If no hearing was had. NLRC G. In its bare minimum due process of law simply means giving notice and opportunity to be heard before judgment is rendered. Issue: Was the dismissal proper without compliance with the requirements of due process? Ruling: The failure of petitioner to give private respondent the benefit of a hearing before he was dismissed constitutes an infringement of his constitutional right to due process of law and equal protection of the laws. it is a matter of fact that when the private respondent filed a complaint against petitioner he was afforded the right to an investigation by the labor arbiter. May 4. 117040. 3 The claim of petitioner that a formal investigation was not necessary because the incident which gave rise to the termination of private respondent was witnessed by his co. 283 the Labor Code. 2000. Serrano v.respective position papers to the Labor Arbiter and as the hearing could not be conducted due to repeated absence of counsel for respondent. The decision is based on private respondent's failure to give petitioner a written notice of termination at least thirty (30) days before the termination of his employment as required by Art. En Banc Facts: Respondent Isetann Department Store moves for reconsideration of the decision in this case insofar as it is ordered to pay petitioner full backwages from the time the latter's employment was terminated on October 11. This is borne by the sworn statements of witnesses. Thereafter a decision was rendered by the Labor Arbiter on December 3. the case was submitted for resolution. 1991 up to the time it is determined that the termination of employment is for an authorized cause. He was found guilty of grave misconduct and insubordination. Indeed. Issue: Was the dismissal valid? Ruling: The decision in Columbia Pictures does not mean that if a new rule is laid down in a case. which we reverse in this case. private respondent puts forth three principal arguments. and petitioner accepted this form of notice although he did not receive payment. 283 of the Labor Code is not in issue in this case because. the Court did not defer application of the rule laid down imposing a fine on the employer for failure to give notice in a case of dismissal for cause. the employee can look for another job while being paid by the company. in the very same case of 20th Century Fox in which the new requirement was laid down. The new rule was applied in opinion of the Court written by Justice Hugo E. where the accused was charged with illegal possession of firearms. when the Court formulated the Wenphil doctrine. in 20th Century Fox Film Corp. the court must require the production of the master tapes of copyrighted films in order to compare them with the "pirated" copies. To the contrary. and (3) that in any event the new ruling announced in this case should only be applied prospectively. The accused invoked the ruling in an earlier case that . Where the new rule was held to be prospective in application was in Columbia Pictures and that was because at the time the search warrant in that case was issued. Jr. Private respondent's view of the principle of prospective application of new judicial doctrines would turn the judicial function into a mere academic exercise with the result that the doctrine laid down would be no more than a dictum and would deprive the holding in the case of any force. For that matter. v. as a matter of fact. Gutierrez. (2) that payment of thirty (30) days pay in lieu of the thirty (30) days prior formal notice is more advantageous to an employee because instead of being required to work for thirty (30) days. Court of Appeals the Court laid down the rule that in determining the existence of probable cause for the issuance of a search warrant in copyright infringement cases. it gave its employees in the affected security section thirty (30) days pay which effectively gave them thirty (30) days notice. the new standard had not yet been announced so it would be unreasonable to expect the judge issuing the search warrant to apply a rule that had not been announced at the time. the new rule was applied right then and there. it should not be applied in that case but that said rule should apply prospectively to cases arising afterwards. A good illustration of the scope of overruling decisions is People v. Mapa. to wit: (1) that its failure to give a written notice to petitioner at least thirty (30) days in advance in accordance with Art.of its motion. nonetheless it applied the new ruling (that secret agents of provincial governors were not authorized to possess firearms) in the very case in which the new rule was announced and convicted the accused. November 17. It employed petitioners Virgilio Agabon and Jenny Agabon as gypsum board and cornice installers on January 2. for this reason. there is no reason not to apply the new standard to this case. No. Issue: Was the termination valid? Ruling: The rule thus evolved: where the employer had a valid reason to dismiss an employee but did not follow the due process requirement. En Banc Facts: Private respondent Riviera Home Improvements.appointment as a secret agent of a provincial governor to assist in the maintenance of peace and order sufficiently put the appointee in the category of a "peace officer" equal to a member of the municipal police authorized under §879 of the Administrative Code of 1917 to carry firearms. because the new doctrine "should not apply to parties who had relied on the old doctrine and acted in good faith thereon" and. the dismissal may be upheld but the employer will be penalized to pay an indemnity to the employee. the Labor Arbiter rendered a decision declaring the dismissals illegal and ordered private respondent to pay the monetary claims. In the case at bar. 1999. Inc. Petitioners then filed a complaint for illegal dismissal and payment of money claims and on December 28. We held that the violation by the employer of the notice requirement in termination for just or authorized causes was not a . 158693. Macarandang on the ground that §879 of the Administrative Code of 1917 was explicit and only those expressly mentioned therein were entitled to possess firearms. 2004. NLRC. This became known as the Wenphil or Belated Due Process Rule. Although in People v. 1992 until February 23. since private respondent does not even claim that it has relied in good faith on the former doctrine of Wenphil and its progeny Sebuguero v. is engaged in the business of selling and installing ornamental and construction materials. Since secret agents were not among those mentioned. The Court rejected the accused's contention and overruled the prior decision in People v. On January 27. NLRC G. they were not authorized to possess firearms. Agabon v.R. 1999 when they were dismissed for abandonment of work. in Serrano. Jabinal the Court refused to give retro active effect to its decision in Mapa. 2000. the rule on the extent of the sanction was changed. it acquitted the accused of illegal possession of firearms. the MPSI issued a memorandum to respondents terminating them effective . however. the dismissal is ineffectual and the employer must pay full backwages from the time of termination until it is judicially declared that the dismissal was for a just or authorized cause. An employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages. Inc. On 11 June 1993. Payment of backwages and other benefits. Villanueva G. v.R. Serrano was confronting the practice of employers to “dismiss now and pay later” by imposing full backwages. Hence. No. Inc.denial of due process that will nullify the termination. the employer shall not terminate the services of an employee except for a just cause or when authorized by this Title. the AWU president sought the dismissal from service of respondents who were expelled from AWU. that the ruling in Serrano did not consider the full meaning of Article 279 of the Labor Code which states: ART.. Security of Tenure. This means that the termination is illegal only if it is not for any of the justified or authorized causes provided by law. 2006 Facts: Respondents were employees of Marina Port Services. including reinstatement. In a letter dated 9 June 1993 to MPSI. November 28. The rationale for the re-examination of the Wenphil doctrine in Serrano was the significant number of cases involving dismissals without requisite notices. Reinstatement to previous position or substantially equivalent position Asian Terminals. (MPSI) and members of the Associated Workers Union of the Philippines (AWU). we now required payment of full backwages from the time of dismissal until the time the Court finds the dismissal was for a just or authorized cause. and to his other benefits or their monetary equivalent computed from the time his compensation was withheld from him up to the time of his actual reinstatement. inclusive of allowances. However. – In cases of regular employment. We concluded that the imposition of penalty by way of damages for violation of the notice requirement was not serving as a deterrent. is justified only if the employee was unjustly dismissed. 143219. We believe. 279. Respondents filed a complaint for constructive illegal dismissal and unfair labor practice with the Arbitration Branch of the NLRC. En Banc Facts: Marilyn Abucay. After consideration of the evidence and arguments of the parties. Issue: Should she be awarded with separation pay? Ruling: The Court holds that henceforth separation pay shall be allowed as a measure of social justice only in those instances where the employee is validly dismissed for causes other than serious misconduct or those reflecting on his moral character. Where the reason for the valid dismissal is. 1 Investigated and heard. Ruling: Reinstatement means restoration to a state or condition from which one had been removed or separated. Promotion is based primarily on an employee’s performance during a certain period. August 23. was accused by two complainants of having demanded and received from them the total amount of P3. Reinstatement means restoration to the former position occupied prior to dismissal or to substantially equivalent position. L-80609. No. NLRC G. The person reinstated assumes the position he had occupied prior to his dismissal.immediately pursuant to the closed-shop provision of the MPSI-AWU Collective Bargaining Agreement. Reinstatement presupposes that the previous position from which one had been removed still exists. . the company was sustained and the complaint was dismissed for lack of merit. 1988. Issue: Whether MPSI reinstated respondents to their former or equivalent positions. Separation pay as financial assistance PLDT v. a traffic operator of the Philippine Long Distance Telephone Company. she was found guilty as charged and accordingly separated from the service.00 in consideration of her promise to facilitate approval of their applications for telephone installation. She went to the Ministry of Labor and Employment claiming she had been illegally removed. Reinstatement does not mean promotion. or that there is an unfilled position which is substantially equivalent or of similar nature as the one previously occupied by the employee. Just because their contemporaries are already occupying higher positions does not automatically entitle respondents to similar positions.800.R. Talde G. A contrary rule would. Arnold Azul. on the ground of social justice. as the petitioner correctly argues. The company questioned the recomputation before the NLRC. The company brought the case to the National Labor Relations Commission (NLRC) for review. the re-computation . Of course it has. the employer may not be required to give the dismissed employee separation pay. manifested to the Labor Arbiter that due to actual animosity between him and the company and threats to his life and his family’s safety. The company denied there was such an animosity. Golden Ace Builders hired Jose A. thus. or whatever other name it is called. Separation pay in lieu of reinstatement – Strained relation rule Golden Ace Builders v. The company’s appeal to the Court of Appeals was likewise dismissed.R. Indeed. however. The Labor Arbiter ruled in Talde’s favor and ordered his immediate reinstatement without loss of seniority rights. Pending such appeal. 187200. the owner-manager. as recomputed by the NLRC’s Fiscal Examiner. the company advised Talde to report for work within 10 days from notice. arguing that since Talde refused to report back to work as the company advised. The monetary award. he should be deemed to have abandoned the same.for example. Talde filed a complaint for illegal dismissal. or financial assistance. service incentive leave pay and 13th month pay. it is not unlikely that he will commit a similar offense in his next employment because he thinks he can expect a like leniency if he is again found out. was approved by the Labor Arbiter who thereupon issued the writ of execution. The NLRC later dismissed the company’s appeal. stopped giving Talde work assignment due allegedly to the unavailability of construction projects. with payment of full backwages as well as premium pay for rest days. of rewarding rather than punishing the erring employee for his offense. In February 1999. Talde (Talde) as a carpenter. Talde. habitual intoxication or an offense involving moral turpitude. Consequently. This kind of misplaced compassion is not going to do labor in general any good as it will encourage the infiltration of its ranks by those who do not deserve the protection and concern of the Constitution. May 5. No. The Court of Appeals’ decision attained finality. 2010 Facts: In 1990. if the employee who steals from the company is granted separation pay even as he is validly dismissed. have the effect. And we do not agree that the punishment is his dismissal only and that the separation pay has nothing to do with the wrong he has committed. like theft or illicit sexual relations with a fellow worker. he opted for payment of separation pay. Strained relations must be demonstrated as a fact and must be supported by substantial evidence showing that the relationship between the employer and the employee is indeed strained as a necessary consequence of the judicial controversy. the company filed a petition for review on certiorari before the Supreme Court. or separation pay if reinstatement is nolonger viable. he may not be afforded affirmative relief. especially when affirmed by the appellate court as in the case at bar. (Citing Macasero v. Ruling: An illegally dismissed employee is entitled to two reliefs: backwages and reinstatement. Consequently.R. the payment of separation pay is considered an acceptable alternative to reinstatement when the latter option is no longer desirable or viable. the Labor Arbiter found that actual animosity existed between the owner-manager Azul and Talde as a result of the filing of the illegal dismissal case. On the other hand. The Court of Appeals set aside the NLRC findings and held that Talde was entitled to both backwages and separation pay. such payment liberates the employee from what could be a highly oppressive work environment. it releases the employer from the grossly unpalatable obligation of maintaining in its employ a worker it could no longer trust. On one hand. even if separation pay was not granted by the Labor Arbiter. Southern Industrial Gases Philippines. not separation pay in lieu of reinstatement. in view of the strained relations between the parties. The two reliefs are separate and distinct. 178524. When reinstatement is no longer feasible because of strained relations between the employee and the employer. separation pay equivalent to one (1) month salary for every year of service should be awarded as an alternative. the day he manifested his refusal to be reinstated. if viable. Issue: Whether or not Talde was entitled to separation pay in lieu of actual reinstatement on account of strained relations between him and the company. 30 January 2009) Under the doctrine of strained relations.should not be beyond 15 May 2001. he may recover backwages only up to 20 May 2001. T he NLRC vacated the re-computation. In this case. an illegally dismissed employee is entitled to either reinstatement. and backwages. is binding upon . The payment of separation pay is in addition to payment of backwages. No. he filed a petition for certiorari with the Court of Appeals. the day he was supposed to return to the job site. In effect. Such finding. G. holding that since Talde did not appeal the Labor Arbiter’s decision granting him only reinstatement and backwages. and since he refused to go back to work. When Talde’s motion for reconsideration was denied by the NLRC. Standing alone. consistent with the prevailing rules that the Supreme Court will not try facts anew and that findings of facts of quasi-judicial bodies are accorded great respect. No. the doctrine of strained relations will not justify an award of separation pay. or for a total of 15 years. Union Bank’s Chief Security Officer. Issue: Are respondents entitled to separatin pay and reinstatement? Ruling: As a relief granted in lieu of reinstatement. Raul Sabang and Diego Morales were hired as security guards by petitioner Leopard Security and Investigation Agency (LSIA). Thru its representative. it has likewise been ruled that the understandable strain in the parties’ relations would not necessarily . respondents went to the Union Bank Cebu Business Park Branch on 30 April 2005. Although litigation may also engender a certain degree of hostility. the day he is deemed to have been actually separated (his reinstatement having been rendered impossible) from the company. 186344. He must be considered to have been in the service of the company not only until 1999. a relief granted in instances where the common denominator is the fact that the employee was dismissed by the employer.the Supreme Court. it consequently goes without saying that an award of separation pay is inconsistent with a finding that there was no illegal dismissal. especially when the employee has not indicated an aversion to returning to work or does not occupy a position of trust and confidence in or has no say in the operation of the employer’s business. Quitoy G. Upon Morales’ instruction. On 3 May 2005.R. The Court of Appeals erroneously computed his separation pay from 1990 (when he was hired to 1999 (when he was unjustly dismissed). Even in cases of illegal dismissal. moral and exemplary damages as well as attorney’s fees. Rogelio Morales. covering a period of 8 years. respondents Tomas Quitoy. even finality. LSIA informed respondents on 29 April 2005 of the termination of its contract with Union Bank which had decided to change its security provider. for the turnover of their service firearms to Arnel Cortes. the doctrine of strained relations is not applied indiscriminately as to bar reinstatement. 2013 Facts: Alongside Numeriano Ondong. but until 30 June 2005. February 20. respondents and Ondong filed a complaint for illegal dismissal. Leopard Security and Investigation Agency v. however. unpaid 13th month pay and service incentive leave pay (SILP). The Labor Arbiter ruled in Talde’s favor and ordered his immediate reinstatement without loss of seniority rights. even for the first time on appeal. Considering that labor officials are. in order. The company brought the case to the National Labor Relations Commission (NLRC) for review. we find that the latter’s reinstatement without backwages is. The company’s appeal to the Court of Appeals was likewise dismissed. Consequently. as recomputed by the NLRC’s Fiscal Examiner. Talde. Pending such appeal. in fact. The company denied there was such an animosity. The NLRC later dismissed the company’s appeal.rule out reinstatement which would. service incentive leave pay and 13th month pay. 187200. manifested to the Labor Arbiter that due to actual animosity between him and the company and threats to his life and his family’s safety. encouraged to use all reasonable means to ascertain the facts speedily and objectively. instead. Arnold Azul. May 5. he opted for payment of separation pay. Absent illegal dismissal on the part of LSIA and abandonment of employment on the part of respondents. the company advised Talde to report for work within 10 days from notice. Talde (Talde) as a carpenter.R. suffice it to say that the NLRC is not precluded from receiving evidence. was . stopped giving Talde work assignment due allegedly to the unavailability of construction projects. because technical rules of procedure are not binding in labor cases. Talde G. In February 1999. LSIA correctly faults the CA for likewise brushing aside the evidence of SILP payments it submitted during the appeal stage before the NLRC. In addition to respondent’s alternative prayer therefor in their position paper. otherwise. The monetary award. reinstatement is justified by LSIA’s directive for them to report for work at its Mandaluyong City office as early of 10 May 2005. 2010 Facts: In 1990. however. Backwages and Separation Pay. the owner-manager. with little resort to technicalities of law or procedure. The Court of Appeals’ decision attained finality. As for the error ascribed the CA for failing to correct the NLRC’s disregard of the evidence showing LSIA’s payment of respondents’ SILP. Talde filed a complaint for illegal dismissal. with payment of full backwages as well as premium pay for rest days. Golden Ace Builders hired Jose A. No. Distinguished Golden Ace Builders v. become the rule rather than the exception in illegal dismissal cases. The NLRC vacated the re-computation. The normal consequences . Issue: Is respondent entitled to backwages? Ruling: The basis for the payment of backwages is different from that for the award of separation pay. an employee who is dismissed without just cause and without due process is entitled to backwages and reinstatement or payment of separation pay in lieu thereof: Thus.approved by the Labor Arbiter who thereupon issued the writ of execution. even if separation pay was not granted by the Labor Arbiter. When Talde’s motion for reconsideration was denied by the NLRC. an illegally dismissed employee is entitled to either reinstatement. and backwages. the day he was supposed to return to the job site. In instances where reinstatement is no longer feasible because of strained relations between the employee and the employer. an illegally dismissed employee is entitled to two reliefs: backwages and reinstatement. or separation pay if reinstatement is no longer viable. the day he manifested his refusal to be reinstated. Southern Industrial Gases Philippines instructs: [T]he award of separation pay is inconsistent with a finding that there was no illegal dismissal. As to how both awards should be computed. not separation pay in lieu of reinstatement. Separation pay is granted where reinstatement is no longer advisable because of strained relations between the employee and the employer. the company filed a petition for review on certiorari before the Supreme Court. he may not be afforded affirmative relief. The two reliefs provided are separate and distinct. The basis for computing backwages is usually the length of the employee’s service while that for separation pay is the actual period when the employee was unlawfully prevented from working. arguing that since Talde refused to report back to work as the company advised. for under Article 279 of the Labor Code and as held in a catena of cases. The company questioned the recomputation before the NLRC. if viable. he should be deemed to have abandoned the same. Consequently. Backwages represent compensation that should have been earned but were not collected because of the unjust dismissal. holding that since Talde did not appeal the Labor Arbiter’s decision granting him only reinstatement and backwages. the re-computation should not be beyond 15 May 2001. he filed a petition for certiorari with the Court of Appeals. he may recover backwages only up to 20 May 2001. and since he refused to go back to work. in view of the strained relations between the parties. In effect. The Court of Appeals set aside the NLRC findings and held that Talde was entitled to both backwages and separation pay. thus. Macasero v. separation pay is granted. NLRC G. on March 15. issued a Memorandum addressed to the private respondent summarizing the various reported incidents signifying unsatisfactory performance on the latter’s part which include the commingling of good and damaged items. February 29. sale of a voluminous quantity of damaged toys and ready-to-wear items at unreasonable prices. private respondent answered all the allegations contained in the March . through Store Manager Apduhan. Constructive dismissal Uniwide Sales Warehouse Club v. In a letterdated March 23.000. 1998. Uniwide received reports from the other employees regarding some problems in the departments managed by the private respondent.R. and payment of backwages computed from the time compensation was withheld up to the date of actual reinstatement. No. Over the years. 1998. Uniwide. Uniwide asked private respondent for concrete plans on how she can effectively perform her job. 2008 Facts: Amalia P. and failure to submit inventory reports. then. As a Full Assistant Store Manager. separation pay equivalent to one (1) month salary for every year of service should be awarded as an alternative. to ensure its continuous profitability as well as to see to it that the established company policies and procedures were properly complied with and implemented in her departments. are reinstatement without loss of seniority rights. private respondent’s primary function was to manage and oversee the operation of the Fashion and Personal Care. Sometime in 1998. and Home Furnishing Departments of Uniwide. Kawada (private respondent) started her employment with Uniwide sometime in 1981 as a saleslady.of respondents’ illegal dismissal. 154503.00 in 1995. Where reinstatement is no longer viable as an option. private respondent worked herself within Uniwide’s corporate ladder until she attained the rank of Full Assistant Store Manager with a monthly compensation of P13. The payment of separation pay is in addition to payment of backwages. GSR Toys. Thus. In a letter dated July 9. the employee who is constructively dismissed may be allowed to keep on coming to work. On June 30. 1998. The last straw of the imputed harassment was the July 31.15. 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. taking advantage of buying damaged items in large quantity. In the present case. with the hope that the latter can get the private respondent to resign. cannot be given credence. The Court finds that private respondent’s allegation of harassment is a specious statement which contains nothing but empty imputation of a fact that could hardly be given any evidentiary weight by this Court. 1998 Memorandum. when uncorroborated by the evidence on record. It is an act amounting to dismissal but made to appear as if it were not. The harassment allegedly came in the form of successive memoranda which private respondent would receive almost every week. Apduhan sent another Memorandum seeking from the private respondent an explanation regarding the incidents reported by Uniwide employees and security personnel for alleged irregularities committed by the private respondent such as allowing the entry of unauthorized persons inside a restricted area during non-office hours. 1998. private respondent claims that from the months of February to June 1998. ridicule and inhumane treatment by Apduhan. Private respondent’s bare allegations of constructive dismissal. . enumerating a litany of offenses and maligning her reputation and spreading rumors among the employees that private respondent shall be dismissed soon. sleeping and allowing a non-employee to sleep inside the private office. Issue: Was there constructive dismissal in this case? Ruling: 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. private respondent answered the allegations made against her. purchase of damaged home furnishing items without the approval from superior. alteration of approval slips for the purchase of damaged items and abandonment of work. falsification of or inducing another employee to falsify personnel or company records. unauthorized search and bringing out of company records. In fact. 1998 incident wherein private respondent’s life was put in danger when she lost consciousness due to hypertension as a result of Apduhan’s alleged hostility and shouting. she had been subjected to constant harassment. Constructive dismissal is therefore a dismissal in disguise. Petitioners Delfin Lazaro Jr. her immediate superior. was its President and Roberto Galang its former Director-Regional Sales. INC. bonuses and other incentives which other employees of the same rank had been receiving. and Cacholo M. Respondent Joan Florendo-Flores was the Senior Account Manager for Northern Luzon. Florendo-Flores bared that Cacholo M. . (GLOBE) is a corporation duly organized and existing under the laws of the Philippines. On 1 July 1998 Joan Florendo-Flores filed with the Regional Arbitration Branch of the National Labor Relations Commission (NLRC) an amended complaint for constructive dismissal against GLOBE. and. i. September 27. 2002 Facts: Petitioner GLOBE TELECOM. In her affidavit submitted as evidence during the arbitration proceedings. 150092.Globe Telecom v. reduced her to a house-tohouse selling agent (person-to-person sales agent or direct sales agent) of company products ("handyphone") despite her rank as supervisor of company dealers and agents.R. Santos. Galang. Florendo-Flores G. Luzon HeadRegional Sales.e. never supported her in the sales programs and recommendations she presented. Lazaro. withheld all her other benefits.. No. Santos never accomplished and submitted her performance evaluation report thereby depriving her of salary increases.  While the body of the decision. She might not have suffered any diminution in her basic salary but petitioners did not dispute her allegation that she was deprived of all benefits due to another of her rank and position. and withholding from her the enjoyment of bonuses. to her extreme pain and humiliation. diminishing her supervisor stature by assigning her to house-to-house sales or direct sales. This was tantamount to a demotion. as an offer involving a demotion in rank and a diminution in pay. and imposes the corresponding duties or obligations. and car Issue: Was there constructive dismissal in this case? Ruling: Where there is conflict between the dispositive portion of the decision and the body thereof. allowances and other similar benefits that were necessary for her efficient sales performance. the dispositive portion controls irrespective of what appears in the body. . She was singularly edged out of employment by the unbearable or undesirable treatment she received from her immediate superior Cacholo M. for the Court of Appeals to have affirmed the assailed judgment is to adopt and uphold the NLRC finding of abandonment and its award of full back wages to respondent as an "act of grace" from petitioners. sets conditions for the exercise of those rights. Although respondent continued to have the rank of a supervisor.not preparing and submitting her performance evaluation report that would have been the basis for her increased salary. unreasonable or unlikely. benefits which she apparently used to receive. her functions were reduced to a mere house-to-house sales agent or direct sales agent. allowance." All these are discernible in respondent's situation. Constructive dismissal exists where there is cessation of work because "continued employment is rendered impossible. However. Hence. it is the dispositive portion thereof that finally invests rights upon the parties. representation maintenance. Santos who discriminated against her without reason . the Court believes this is not the proper view as the records reveal that respondent was constructively dismissed from service. per diems.gasoline allowance. order or resolution might create some ambiguity in the manner the court's reasoning preponderates. not forwarding her project proposals to management that would have been the source of commendation.