The Diamond Batch I. APPLICABLE LAWS II. BASIC PRINCIPLES ATOK BIG WEDGE COMPANY vs. GISON G.R. No. !"#$% &UGUST '% ($ )&CTS* Sometime in )e+r,ary ""(% res-ondent .es,s /. Gison was engaged as -art0time cons,ltant on retainer +asis +y -etitioner &to1 Big 2edge Com-any% 3nc. thro,gh its then &sst. 4ice0/resident and &cting Resident 5anager% R,tillo &. Torres. &s a cons,ltant on retainer +asis% res-ondent assisted -etitioner6s retained legal co,nsel with matters -ertaining to the -rosec,tion of cases against illegal s,rface occ,-ants within the area covered +y the com-any6s mineral claims. Res-ondent was li1ewise tas1ed to -erform liaison wor1 with several government agencies% which he said was his e7-ertise. /etitioner did not re8,ire res-ondent to re-ort to its o9ce on a reg,lar +asis% e7ce-t when occasionally re8,ested +y the management to disc,ss matters needing his e7-ertise as a cons,ltant. &s -ayment for his services% res-ondent received a retainer fee of /:%$$$.$$ a month% which was delivered to him either at his residence or in a local resta,rant. The -arties e7ec,ted a retainer agreement% +,t s,ch agreement was mis-laced and can no longer +e fo,nd. The said arrangement contin,ed for the ne7t eleven years. Sometime thereafter% since res-ondent was getting old% he re8,ested that -etitioner ca,se his registration with the Social Sec,rity System ;SSS<% +,t -etitioner did not accede to his re8,est. =e later reiterated his re8,est +,t it was ignored +y res-ondent considering that he was only a retainer>cons,ltant. ?n )e+r,ary @% ($$:% res-ondent Aled a Com-laint with the SSS against -etitioner for the latter6s ref,sal to ca,se his registration with the SSS. ?n the same date% 5ario D. Cera% in his ca-acity as resident manager of -etitioner% iss,ed a 5emorand,m advising res-ondent that within :$ days from recei-t thereof% -etitioner is terminating his retainer contract with the com-any since his services are no longer necessary. ?n )e+r,ary (% ($$:% res-ondent Aled a Com-laint for illegal dismissal% ,nfair la+or -ractice% ,nder-ayment of wages% non0-ayment of :th month -ay% vacation -ay% and sic1 leave -ay with the National La+or Relations Commission ;NLRC<% Regional &r+itration Branch ;R&B<% Cordillera &dministrative Region% against -etitioner% 5ario D. Cera% and TeoAlo R. &s,ncion% .r. The case was doc1eted as NLRC Case No. R&B0C&R0$(0$$"'0 $:. 3SSUB* 2hether or not there was an em-loyer0em-loyee realationshi- and whether Gison was illegally dismissed. SC RUL3NG* The -etition is meritorio,s. To ascertain the e7istence of an em-loyer0em-loyee relationshi- C,ris-r,dence has invaria+ly adhered to the fo,r0fold test% to wit* ;< the selection and engagement of the em-loyeeD ;(< the -ayment of wagesD ;:< the -ower of dismissalD and ;@< the -ower to control the em-loyee6s cond,ct% or the so0called Econtrol test.E?f these fo,r% the last one is the most im-ortant. The so0called Econtrol testE is commonly regarded as the most cr,cial and determinative indicator of the -resence or a+sence of an em-loyer0em-loyee relationshi-. Under the control test% an em-loyer0 em-loyee relationshi- e7ists where the -erson for whom the services are -erformed reserves the right to control not only the end achieved% +,t also the manner and means to +e ,sed in reaching that end. &--lying the aforementioned test% an em-loyer0em-loyee relationshi- is a--arently a+sent in the case at +ar. &mong other things% res-ondent was not re8,ired to re-ort everyday d,ring reg,lar o9ce ho,rs of -etitioner. Res-ondent6s monthly retainer fees were -aid to him either at his residence or a local resta,rant. 5ore im-ortantly% -etitioner did not -rescri+e the manner in which res-ondent wo,ld accom-lish any of the tas1s in which his e7-ertise as a liaison o9cer was neededD res-ondent was left alone and given the freedom to accom-lish the tas1s ,sing his own means and method. Res-ondent was assigned tas1s to -erform% +,t -etitioner did not control the manner and methods +y which res-ondent -erformed these tas1s. 4erily% the a+sence of the element of control on the -art of the -etitioner engenders a concl,sion that he is not an em-loyee of the -etitioner. 5oreover% the a+sence of the -arties6 retainershi- agreement notwithstanding% res-ondent clearly admitted that -etitioner hired him in a limited ca-acity only and that there will +e no em-loyer0em-loyee relationshi- +etween them. F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch Contrary to the concl,sion of the C&% res-ondent is not an em-loyee% m,ch more a reg,lar em-loyee of -etitioner. The a--ellate co,rt6s -remise that reg,lar em-loyees are those who -erform activities which are desira+le and necessary for the +,siness of the em-loyer is not determinative in this case. 3n fact% any agreement may -rovide that one -arty shall render services for and in +ehalf of another% no matter how necessary for the latter6s +,siness% even witho,t +eing hired as an em-loyee. =ence% res-ondent6s length of service and -etitioner6s re-eated act of assigning res-ondent some tas1s to +e -erformed did not res,lt to res-ondent6s entitlement to the rights and -rivileges of a reg,lar em-loyee. ),rthermore% des-ite the fact that -etitioner made ,se of the services of res-ondent for eleven years% he still cannot +e considered as a reg,lar em-loyee of -etitioner. &rticle ('$ of the La+or Code% in which the lower co,rt ,sed to +,ttress its Andings that res-ondent +ecame a reg,lar em-loyee of the -etitioner% is not a--lica+le in the case at +ar. 3ndeed% the Co,rt has r,led that said -rovision is not the yardstic1 for determining the e7istence of an em-loyment relationshi- +eca,se it merely disting,ishes +etween two 1inds of em-loyees% i.e.% reg,lar em-loyees and cas,al em-loyees% for -,r-oses of determining the right of an em-loyee to certain +eneAts% to Coin or form a ,nion% or to sec,rity of ten,reD it does not a--ly where the e7istence of an em-loyment relationshi- is in dis-,te. 3t is% therefore% erroneo,s on the -art of the Co,rt of &--eals to rely on &rticle ('$ in determining whether an em-loyer0em-loyee relationshi- e7ists +etween res-ondent and the -etitioner Considering that there is no em-loyer0em-loyee relationshi- +etween the -arties% the termination of res-ondent6s services +y the -etitioner after d,e notice did not constit,te illegal dismissal warranting his reinstatement and the -ayment of f,ll +ac1wages% allowances and other +eneAts. SEMBLANTE et al., vs. COURT OF APPEALS, et al. G.R. No. "!@(!% &UGUST #% ($ )&CTS* /etitioners 5articio Sem+lante ;Sem+lante< and D,+ric1 /ilar ;/ilar< assert that they were hired +y res-ondents0s-o,ses 4icente and 5aria L,isa Loot% the owners of Gallera de 5anda,e ;the coc1-it<% as the o9cial masiador and sentenciador% res-ectively% of the coc1-it sometime in "":. /etitioners had +oth +een iss,ed em-loyeesI identiAcation cards that they wear every time they re-ort for d,ty. They alleged never having inc,rred any infraction and>or violation of the coc1-it r,les and reg,lations. -etitioners were denied entry into the coc1-it ,-on the instr,ctions of res-ondents% and were informed of the termination of their services eJective that date. This -rom-ted -etitioners to Ale a com-laint for illegal dismissal against res-ondents. La+or &r+iter .,lie C. Rendo8,e fo,nd -etitioners to +e reg,lar em-loyees of res-ondents as they -erformed wor1 that was necessary and indis-ensa+le to the ,s,al trade or +,siness of res-ondents for a n,m+er of years. NLRC denied the a--eal for its non0-erfection. The NLRC held that there was no em-loyer0em-loyee relationshi- +etween -etitioners and res-ondents% res-ondents having no -art in the selection and engagement of -etitioners% and that no se-arate individ,al contract with res-ondents was ever e7ec,ted +y -etitioners. % the a--ellate co,rt fo,nd for res-ondents% noting that referees and +et0ta1ers in a coc1Aght need to have the 1ind of e7-ertise that is characteristic of the game to inter-ret messages conveyed +y mere gest,res. =ence% -etitioners are a1in to inde-endent contractors who -ossess ,ni8,e s1ills% e7-ertise% and talent to disting,ish them from ordinary em-loyees. ),rther% res-ondents did not s,--ly -etitioners with the tools and instr,mentalities they needed to -erform wor1. /etitioners only needed their ,ni8,e s1ills and talents to -erform their Co+ as masiador and sentenciador. The C& ref,sed to reconsider its Decision. 3SSUB* 2hether or not there is an em-loyer0em-loyee relationshi-. SC RUL3NG* 2hile res-ondents had failed to -ost their +ond within the $0day -eriod -rovided a+ove% it is evident% on the other hand% that -etitioners are N?T em-loyees of res-ondents% since their relationshi- fails to -ass m,ster the fo,r0fold test of em-loyment. &s fo,nd +y +oth the NLRC and the C&% res-ondents had no -art in -etitionersI selection and managementD -etitionersI com-ensation was -aid o,t of the arri+a ;which is a -ercentage ded,cted from the total +ets<% not +y -etitionersD and -etitioners -erformed their f,nctions as masiador and sentenciador free from the direction and control of res-ondents. 3n the cond,ct of their wor1% -etitioners relied mainly on their Ee7-ertise that is characteristic of the coc1Aght gam+ling%E and were never given +y res-ondents any tool needed for the -erformance of their wor1. ( F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch Res-ondents% not +eing -etitionersI em-loyers% co,ld never have dismissed% legally or illegally% -etitioners% since res-ondents were witho,t -ower or -rerogative to do so in the Arst -lace. The r,le on the -osting of an a--eal +ond cannot defeat the s,+stantive rights of res-ondents to +e free from an ,nwarranted +,rden of answering for an illegal dismissal for which they were never res-onsi+le. BERNARTE vs. PHIL. BASKETBALL ASSOCIATION et al. G.R. No. "($'@% SB/TB5BBR @% ($ )&CTS* Com-lainants ;.ose 5el Bernarte and Renato G,evarra< aver that they were invited to Coin the /B& as referees. D,ring the leadershi- of Commissioner Bmilio Bernardino% they were made to sign contracts on a year0to0year +asis. D,ring the term of Commissioner Bala% however% changes were made on the terms of their em-loyment. They contend they were illegally dismissed. Res-ondents aver% on the other hand% that com-lainants entered into two contracts of retainer with the /B&. Com-lainants were not illegally dismissed +eca,se they were not em-loyees of the /B&. Their res-ective contracts of retainer were sim-ly not renewed. /B& had the -rerogative of whether or not to renew their contracts% which they 1new were A7ed. La+or &r+iter declared -etitioner an em-loyee whose dismissal +y res-ondents was illegal. &ccordingly% the La+or &r+iter ordered the reinstatement of -etitioner and the -ayment of +ac1wages% moral and e7em-lary damages and attorneyIs fees. NLRC a9rmed the La+or &r+iterIs C,dgment. Res-ondents Aled a -etition for certiorari with the Co,rt of &--eals% which overt,rned the decisions of the NLRC and La+or &r+iter. 3SSUB* 2hether -etitioner is an em-loyee of res-ondents% which in t,rn determines whether -etitioner was illegally dismissed. SC RUL3NG* To determine the e7istence of an em-loyer0em-loyee relationshi-% case law has consistently a--lied the fo,r0fold test. 3n this case% /B& admits re-eatedly engaging -etitionerIs services% as shown in the retainer contracts. /B& -ays -etitioner a retainer fee% e7cl,sive of -er diem or allowances% as sti-,lated in the retainer contract. /B& can terminate the retainer contract for -etitionerIs violation of its terms and conditions. The contract,al sti-,lations hardly demonstrate control over the means and methods +y which -etitioner -erforms his wor1 as a referee o9ciating a /B& +as1et+all game. The contract,al sti-,lations do not -ertain to% m,ch less dictate% how and when -etitioner will +low the whistle and ma1e calls. ?n the contrary% they merely serve as r,les of cond,ct or g,idelines in order to maintain the integrity of the -rofessional +as1et+all leag,e. &s correctly o+served +y the Co,rt of &--eals% Khow co,ld a s1illed referee -erform his Co+ witho,t +lowing a whistle and ma1ing callsL 7 7 7 M=Now can the /B& control the -erformance of wor1 of a referee witho,t controlling his acts of +lowing the whistle and ma1ing callsLO 2e agree with res-ondents that once in the -laying co,rt% the referees e7ercise their own inde-endent C,dgment% +ased on the r,les of the game% as to when and how a call or decision is to +e made. The referees decide whether an infraction was committed% and the /B& cannot overr,le them once the decision is made on the -laying co,rt. The referees are the only% a+sol,te% and Anal a,thority on the -laying co,rt. Res-ondents or any of the /B& o9cers cannot and do not determine which calls to ma1e or not to ma1e and cannot control the referee when he +lows the whistle +eca,se s,ch a,thority e7cl,sively +elongs to the referees. The very nat,re of -etitionerIs Co+ of o9ciating a -rofessional +as1et+all game ,ndo,+tedly calls for freedom of control +y res-ondents. 5oreover% the following circ,mstances indicate that -etitioner is an inde-endent contractor* ;< the referees are re8,ired to re-ort for wor1 only when /B& games are sched,led% which is three times a wee1 s-read over an average of only $# -laying days a year% and they o9ciate games at an average of two ho,rs -er gameD and ;(< the only ded,ctions from the fees received +y the referees are withholding ta7es. 3n other words% ,nli1e reg,lar em-loyees who ordinarily re-ort for wor1 eight ho,rs -er day for Ave days a wee1% -etitioner is re8,ired to re-ort for wor1 only when /B& games are sched,led or three times a wee1 at two ho,rs -er game. 3n addition% there are no ded,ctions for contri+,tions to the Social Sec,rity System% /hilhealth or /ag03+ig% which are the ,s,al ded,ctions from em-loyeesI salaries. These ,ndis-,ted circ,mstances +,ttress the fact that -etitioner is an inde-endent contractor% and not an em-loyee of res-ondents. : F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch ),rthermore% the a--lica+le foreign case law declares that a referee is an inde-endent contractor whose s-ecial s1ills and inde-endent C,dgment are re8,ired s-eciAcally for s,ch -osition and cannot -ossi+ly +e controlled +y the hiring -arty. 3n addition% the fact that /B& re-eatedly hired -etitioner does not +y itself -rove that -etitioner is an em-loyee of the former. )or a hired -arty to +e considered an em-loyee% the hiring -arty m,st have control over the means and methods +y which the hired -arty is to -erform his wor1% which is a+sent in this case. The contin,o,s rehiring +y /B& of -etitioner sim-ly signiAes the renewal of the contract +etween /B& and -etitioner% and highlights the satisfactory services rendered +y -etitioner warranting s,ch contract renewal. Conversely% if /B& decides to discontin,e -etitionerIs services at the end of the term A7ed in the contract% whether for ,nsatisfactory services% or violation of the terms and conditions of the contract% or for whatever other reason% the same merely res,lts in the non0 renewal of the contract% as in the -resent case. The non0renewal of the contract +etween the -arties does not constit,te illegal dismissal of -etitioner +y res-ondents. LIRIO vs. GENOVIA G.R. No. !"P#P% N?4B5BBR (:% ($ )&CTS* Res-ondent Genovia alleged he was hired as st,dio manager +y -etitioner Lirio% owner of Cel1or &d Sonicmi7 Recording St,dio ;Cel1or<. =e was em-loyed to manage and o-erate Cel1or and to -romote and sell the recording st,dio6s services to m,sic enth,siasts and other -ros-ective clients. Res-ondent stated that a few days after he started wor1ing as a st,dio manager% -etitioner a--roached him and told him a+o,t his -roCect to -rod,ce an al+,m for his #0year0old da,ghter% Celine 5ei Lirio% a former talent of &BS0CBN Star Records. /etitioner as1ed res-ondent to com-ose and arrange songs for Celine and -romised that he ;Lirio< wo,ld draft a contract to ass,re res-ondent of his com-ensation for s,ch services. &s agreed ,-on% the additional services that res-ondent wo,ld render incl,ded com-osing and arranging m,sical scores only% while the technical as-ect in -rod,cing the al+,m% s,ch as digital editing% mi7ing and so,nd engineering wo,ld +e -erformed +y res-ondent in his ca-acity as st,dio manager for which he was -aid on a monthly +asis. /etitioner instr,cted res-ondent that his wor1 on the al+,m as com-oser and arranger wo,ld only +e done d,ring his s-are time% since his other wor1 as st,dio manager was the -riority. Res-ondent then started wor1ing on the al+,m. =e reminded -etitioner a+o,t his com-ensation as com-oser and arranger of the al+,m. Res-ondent again reminded -etitioner a+o,t the contract on his com-ensation as com-oser and arranger of the al+,m. /etitioner told res-ondent that since he was -ractically a no+ody and had -roven nothing yet in the m,sic ind,stry% res-ondent did not deserve a high com-ensation% and he sho,ld +e than1f,l that he was given a Co+ to feed his family. /etitioner informed res-ondent that he was entitled only to ($Q of the net -roAt% and not of the gross sales of the al+,m% and that the salaries he received and wo,ld contin,e to receive as st,dio manager of Cel1or wo,ld +e ded,cted from the said ($Q net -roAt share. Res-ondent o+Cected and insisted that he +e -ro-erly com-ensated. ?n 5arch @% ($$(% -etitioner ver+ally terminated res-ondentIs services% and he was instr,cted not to re-ort for wor1. La+or &r+iter rendered a decision% Anding that an em-loyer0em-loyee relationshi- e7isted +etween -etitioner and res-ondent% and that res-ondent was illegally dismissed. NLRC reversed and set aside the decision of the La+or &r+iter. Res-ondentIs motion for reconsideration was denied +y the NLRC. Co,rt of &--eals rendered a decision reversing and setting aside the resol,tion of the NLRC% and reinstating the decision of the La+or &r+iter. /etitionerIs motion for reconsideration was denied for lac1 of merit +y the Co,rt of &--eals. 3SSUB* 2hether there e7ists an BR0BB relationshi- +etween the -arties. SC RUL3NG* /etitionerIs arg,ment lac1s merit. Before a case for illegal dismissal can -ros-er% it m,st Arst +e esta+lished that an em-loyer0em-loyee relationshi- e7isted +etween -etitioner and res-ondent. 3t is settled that no -artic,lar form of evidence is re8,ired to -rove the e7istence of an em-loyer0em-loyee relationshi-. &ny com-etent and relevant evidence to -rove the relationshi- may +e admitted. 3n this case% the doc,mentary evidence -resented +y res-ondent to -rove that he was an em-loyee of -etitioner are as follows* ;a< a doc,ment denominated as E-ayrollE ;dated .,ly :% ($$ to 5arch #% ($$(< certiAed @ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch correct +y -etitioner% which showed that res-ondent received a monthly salary of /P%$$$.$$ ;/:%#$$.$$ every #th of the month and another /:%#$$.$$ every :$th of the month< with the corres-onding ded,ctions d,e to a+sences inc,rred +y res-ondentD and ;(< co-ies of -etty cash vo,chers% showing the amo,nts he received and signed for in the -ayrolls. The said doc,ments showed that -etitioner hired res-ondent as an em-loyee and he was -aid monthly wages of /P%$$$.$$. /etitioner wielded the -ower to dismiss as res-ondent stated that he was ver+ally dismissed +y -etitioner% and res-ondent% thereafter% Aled an action for illegal dismissal against -etitioner. The -ower of control refers merely to the e7istence of the -ower. 3t is not essential for the em-loyer to act,ally s,-ervise the -erformance of d,ties of the em-loyee% as it is s,9cient that the former has a right to wield the -ower. Nevertheless% -etitioner stated in his /osition /a-er that it was agreed that he wo,ld hel- and teach res-ondent how to ,se the st,dio e8,i-ment. 3n s,ch case% -etitioner certainly had the -ower to chec1 on the -rogress and wor1 of res-ondent. ?n the other hand% -etitioner failed to -rove that his relationshi- with res-ondent was one of -artnershi-. S,ch claim was not s,--orted +y any written agreement. The Co,rt notes that in the -ayroll dated .,ly :% ($$ to 5arch #% ($$(% there were ded,ctions from the wages of res-ondent for his a+sence from wor1% which negates -etitionerIs claim that the wages -aid were advances for res-ondentIs wor1 in the -artnershi-. 3n termination cases% the +,rden is ,-on the em-loyer to show +y s,+stantial evidence that the termination was for lawf,l ca,se and validly made. &rticle (PP ;+< of the La+or Code -,ts the +,rden of -roving that the dismissal of an em-loyee was for a valid or a,thoriRed ca,se on the em-loyer% witho,t distinction whether the em-loyer admits or does not admit the dismissal. )or an em-loyeeIs dismissal to +e valid% ;a< the dismissal m,st +e for a valid ca,se% and ;+< the em-loyee m,st +e aJorded d,e -rocess. /roced,ral d,e -rocess re8,ires the em-loyer to f,rnish an em-loyee with two written notices +efore the latter is dismissed* ;< the notice to a--rise the em-loyee of the -artic,lar acts or omissions for which his dismissal is so,ght% which is the e8,ivalent of a chargeD and ;(< the notice informing the em-loyee of his dismissal% to +e iss,ed after the em-loyee has +een given reasona+le o--ort,nity to answer and to +e heard on his defense. /etitioner failed to com-ly with these legal re8,irementsD hence% the Co,rt of &--eals correctly a9rmed the La+or &r+iterIs Anding that res-ondent was illegally dismissed% and entitled to the -ayment of +ac1wages% and se-aration -ay in lie, of reinstatement. AO vs. BCC PRODUCTS SALES INC. G.R. No. !:P$$% &/R3L '% ($( )&CTS* /etitioner maintained that res-ondent BCC /rod,ct Sales 3nc. ;BCC< and its /resident% res-ondent Terrance Ty ;Ty<% em-loyed him as com-troller starting from Se-tem+er ""# with a monthly salary of /($%$$$.$$ to handle the Anancial as-ect of BCCIs +,sinessD that on ?cto+er "%""#% the sec,rity g,ards of BCC% acting ,-on the instr,ction of Ty% +arred him from entering the -remises of BCC where he then wor1edD that his attem-ts to re-ort to wor1 in Novem+er and Decem+er (% ""# were fr,strated +eca,se he contin,ed to +e +arred from entering the -remises of BCCD and that he Aled a com-laint dated Decem+er ('% ""# for illegal dismissal% reinstatement with f,ll +ac1wages% non0-ayment of wages% damages and attorneyIs fees. Res-ondents co,ntered that -etitioner was not their em-loyee +,t the em-loyee of So+ien )ood Cor-oration ;S)C<% the maCor creditor and s,--lier of BCCD and that S)C had -osted him as its com-troller in BCC to oversee BCCIs Anances and +,siness o-erations and to loo1 after S)CIs interests or investments in BCC. La+or &r+iter r,led in favor of -etitioner NLRC vacated the r,ling and remanded the case for f,rther -roceedings. Thereafter% La+or &r+iter rendered a new decision dismissing -etitionerIs com-laint for want of an em-loyer0em-loyee relationshi- +etween the -arties. NLRC rendered a decision reversing La+or &r+iter 5ayorIs decision% and declaring that -etitioner had +een illegally dismissed. Res-ondents moved for the reconsideration of the NLRC decision% +,t their motion for reconsideration was denied. Thence% res-ondents assailed the NLRC decision on certiorari in the C& which fo,nd that no em-loyer0em-loyee relationshi- e7isted +etween -etitioner BCC and the -rivate res-ondent. 3SSUB* 2hether -etitioner was res-ondentsI em-loyee or not. SC RUL3NG* # F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch 2e cannot side with -etitioner. ?,r -er,sal of the a9davit of -etitioner com-els a concl,sion similar to that reached +y the C& and the La+or &r+iter to the eJect that the a9davit act,ally s,--orted the contention that -etitioner had really wor1ed in BCC as S)CIs re-resentative. 3t does seem more nat,ral and more +elieva+le that -etitionerIs a9davit was referring to his em-loyment +y S)C even while he was re-orting to BCC as a com-troller in +ehalf of S)C. &s res-ondents -ointed o,t% it was im-la,si+le for S)C to still -ost him to oversee and s,-ervise the collections of acco,nts receiva+les d,e from BCC +eyond Decem+er ""# if% as he insisted% BCC had already illegally dismissed him and had even -revented him from entering the -remises of BCC. Given the -atent animosity and strained relations +etween him and res-ondents in s,ch circ,mstances% indeed% how co,ld he still e9ciently -erform in +ehalf of S)C the essential res-onsi+ility to Koversee and s,-ervise collectionsO at BCCL S,rely% res-ondents wo,ld have vigoro,sly o+Cected to any arrangement with S)C involving him. 2e note that -etitioner e7ec,ted the a9davit in 5arch ""! to ref,te a statement Ty himself made in his own a9davit dated Decem+er % ""# to the eJect that -etitioner had illegally a--ro-riated some chec1s witho,t a,thority from BCC. /etitioner there+y so,ght to show that he had the a,thority to receive the chec1s -,rs,ant to the arrangements +etween S)C and BCC. This showing wo,ld aid in fending oJ the criminal charge res-ondents Aled against him arising from his mishandling of the chec1s. ),rther% an a9davit dated Se-tem+er #% ($$$ +y &lfredo So% the /resident of S)C% whom -etitioner oJered as a re+,ttal witness% lent credence to res-ondentsI denial of -etitionerIs em-loyment. So declared in that a9davit% among others% that he had 1nown -etitioner for +eing Kearlier his retained acco,ntant having his own o9ce +,t did not hold o9ceO in S)CIs -remisesD that Ty had a--roached him ;So< Kloo1ing for an acco,ntant or com-troller to +e em-loyed +y him ;Ty< in MBCCIsN distri+,tion +,sinessO of S)CIs general merchandise% and had later as1ed him on his o-inion a+o,t -etitionerD and that he ;So< had s,+se8,ently learned that KTy had already em-loyed M-etitionerN as his com-troller as of Se-tem+er ""#.O The statements of So really s,--orted res-ondentsI -osition in that -etitionerIs association with S)C -rior to his s,--osed em-loyment +y BCC went +eyond mere ac8,aintance with So. That So% who had earlier merely KretainedO -etitioner as his acco,ntant% thereafter em-loyed -etitioner as a KretainedO acco,ntant after his s,--osed illegal dismissal +y BCC raised a do,+t as to his em-loyment +y BCC% and rather conArmed res-ondentsI assertion of -etitioner +eing an em-loyee of S)C while he wor1ed at BCC. 5oreover% in determining the -resence or a+sence of an em-loyer0 em-loyee relationshi-% the Co,rt has consistently loo1ed for the following incidents% to wit* ;a< the selection and engagement of the em-loyeeD ;+< the -ayment of wagesD ;c< the -ower of dismissalD and ;d< the em-loyerIs -ower to control the em-loyee on the means and methods +y which the wor1 is accom-lished. The last element% the so0called control test% is the most im-ortant element. =ere,nder are some of the circ,mstances and incidents occ,rring while -etitioner was s,--osedly em-loyed +y BCC that de+,n1ed his claim against res-ondents.
3t can +e ded,ced from the 5arch ""! a9davit of -etitioner that res-ondents challenged his a,thority to deliver some #' chec1s to S)C. Considering that he contested res-ondentsI challenge +y -ointing to the e7isting arrangements +etween BCC and S)C% it sho,ld +e clear that res-ondents did not e7ercise the -ower of control over him% +eca,se he there+y acted for the +eneAt and in the interest of S)C more than of BCC.
3n addition% -etitioner -resented no doc,ment setting forth the terms of his em-loyment +y BCC. The fail,re to -resent s,ch agreement on terms of em-loyment may +e ,nderstanda+le and e7-ected if he was a common or ordinary la+orer who wo,ld not Ceo-ardiRe his em-loyment +y demanding s,ch doc,ment from the em-loyer% +,t may not s8,are well with his act,al stat,s as a highly ed,cated -rofessional. /etitionerIs admission that he did not receive his salary for the three months of his em-loyment +y BCC% as his com-laint for illegal dismissal and non0-ayment of wages and the criminal case for estafa he later Aled against the res-ondents for non0-ayment of wages indicated% f,rther raised grave do,+ts a+o,t his assertion of em-loyment +y BCC. 3f the assertion was tr,e% we are -,RRled how he co,ld have remained in BCCIs em-loy in that -eriod of time des-ite not +eing -aid the Arst salary of/($%$$$.$$>month. 5oreover% his name did not a--ear in the -ayroll of BCC des-ite him having a--roved the -ayroll as com-troller. Lastly% the conf,sion a+o,t the date of his alleged illegal dismissal -rovides another indici,m of the insincerity of -etitionerIs assertion of em-loyment +y BCC. 3n the -etition for review on certiorari% he averred that he had +een ! F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch +arred from entering the -remises of BCC on ?cto+er "% ""#% and th,s was illegally dismissed. Set% his com-laint for illegal dismissal stated that he had +een illegally dismissed on Decem+er (% ""# when res-ondentsI sec,rity g,ards +arred him from entering the -remises of BCC% ca,sing him to +ring his com-laint only on Decem+er ("% ""#% and after BCC had already Aled the criminal com-laint against him. The wide ga- +etween ?cto+er "% ""# and Decem+er (% ""# cannot +e dismissed as a trivial inconsistency considering that the several incidents aJecting the veracity of his assertion of em-loyment +y BCC earlier noted herein trans-ired in that interval. 2ith all the grave do,+ts th,s raised against -etitionerIs claim% we need not dwell at length on the other -roofs he -resented% li1e the a9davits of some of the em-loyees of BCC% the 3D% and the signed chec1s% +ills and recei-ts. S,9ce it to +e stated that s,ch other -roofs were easily e7-laina+le +y res-ondents and +y the aforestated circ,mstances showing him to +e the em-loyee of S)C% not of BCC. LEGEND HOTEL V. REALUYO G.R. N?. #:#% .ULS '% ($( )&CTS* This la+or case for illegal dismissal involves a -ianist em-loyed to -erform in the resta,rant of a hotel. ?n &,g,st "% """% res-ondent% whose stage name was .oey R. Roa% Aled a com-laint for alleged ,nfair la+or -ractice% constr,ctive illegal dismissal% and the ,nder-ayment>non-ayment of his -remi,m -ay for holidays% se-aration -ay% service incentive leave -ay% and :th month -ay. Res-ondent averred that he had wor1ed as a -ianist at the Legend =otelIs Tanglaw Resta,rant from Se-tem+er ""( with an initial rate of /@$$.$$>night that was given to him after each nightIs -erformanceD that his rate had increased to /P#$.$$>nightD and that d,ring his em-loyment% he co,ld not choose the time of -erformance% which had +een A7ed from P*$$ -m to $*$$ -m for three to si7 times>wee1. =e added that the Legend =otelIs resta,rant manager had re8,ired him to conform with the ven,eIs motifD that he had +een s,+Cected to the r,les on em-loyeesI re-resentation chec1s and chits% a -rivilege granted to other em-loyeesD that on .,ly "% """% the management had notiAed him that as a cost0 c,tting meas,re his services as a -ianist wo,ld no longer +e re8,ired eJective .,ly :$% """D that he dis-,ted the e7c,se% insisting that Legend =otel had +een l,cratively o-erating as of the Aling of his com-laintD and that the loss of his em-loyment made him +ring his com-laint.M(N 3n its defense% -etitioner denied the e7istence of an em-loyer0 em-loyee relationshi- with res-ondent% insisting that he had +een only a talent engaged to -rovide live m,sic at Legend =otelIs 5adison CoJee Sho- for three ho,rs>day on two days each wee1D and stated that the economic crisis that had hit the co,ntry constrained management to dis-ense with his services. 3SSUBS* 2?N there e7ists an Bm-loyee0Bm-loyer relationshi- +etween the -etitioner or the res-ondent RUL3NG* Bm-loyer0em-loyee relationshi- e7isted +etween the -arties & review of the circ,mstances reveals that res-ondent was% indeed% -etitionerIs em-loyee. =e was ,ndenia+ly em-loyed as a -ianist in -etitionerIs 5adison CoJee Sho->Tanglaw Resta,rant from Se-tem+er ""( ,ntil his services were terminated on .,ly "% """. /etitioner co,ld not see1 ref,ge +ehind the service contract entered into with res-ondent. 3t is the law that deAnes and governs an em-loyment relationshi-% whose terms are not restricted to those A7ed in the written contract% for other factors% li1e the nat,re of the wor1 the em-loyee has +een called ,-on to -erform% are also considered. The law aJords -rotection to an em-loyee% and does not co,ntenance any attem-t to s,+vert its s-irit and intent. &ny sti-,lation in writing can +e ignored when the em-loyer ,tiliRes the sti-,lation to de-rive the em-loyee of his sec,rity of ten,re. The ine8,ality that characteriRes em-loyer0em-loyee relations generally ti-s the scales in favor of the em-loyer% s,ch that the em-loyee is often scarcely -rovided real and +etter o-tions. Secondly% -etitioner arg,es that whatever rem,neration was given to res-ondent were only his talent fees that were not incl,ded in the deAnition of wage ,nder theLa+or CodeD and that s,ch talent fees were +,t the consideration for the service contract entered into +etween them. The arg,ment is +aseless. P F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch Res-ondent was -aid /@$$.$$ -er three ho,rs of -erformance from P*$$ -m to $*$$ -m% three to si7 nights a wee1. S,ch rate of rem,neration was later increased to /P#$.$$ ,-on resta,rant manager 4elaRcoIs recommendation. There is no denying that the rem,neration denominated as talent fees was A7ed on the +asis of his talent and s1ill and the 8,ality of the m,sic he -layed d,ring the ho,rs of -erformance each night% ta1ing into acco,nt the -revailing rate for similar talents in the entertainment ind,stry. Res-ondentIs rem,neration% al+eit denominated as talent fees% was still considered as incl,ded in the term wage in the sense and conte7t of the La+or Code% regardless of how -etitioner chose to designate the rem,neration. &nent this% &rticle "P;f< of the La+or Code clearly states* 777 wage -aid to any em-loyee shall mean the rem,neration or earnings% however designated% ca-a+le of +eing e7-ressed in terms of money% whether A7ed or ascertained on a time% tas1% -iece% or commission +asis% or other method of calc,lating the same% which is -aya+le +y an em-loyer to an em-loyee ,nder a written or ,nwritten contract of em-loyment for wor1 done or to +e done% or for services rendered or to +e rendered% and incl,des the fair and reasona+le val,e% as determined +y the Secretary of La+or% of +oard% lodging% or other facilities c,stomarily f,rnished +y the em-loyer to the em-loyee. THE NEW PHILIPPINE SKYLANDERS, INC VS FRANCISCO N. DAKILA SB/TB5BBR (@% ($( )&CTS* Da1ila was em-loyed +y New /hili--ine S1ylanders as early as "'P and terminated for ca,se in &-ril ""P when the cor-oration was sold. 3n 5ay ""P% he was rehired as cons,ltant +y the -etitioners ,nder a Contract for Cons,ltancy Services dated &-ril :$% ""P. 3n a letter dated &-ril "% ($$P% Da1ila informed the cor-oration of his com-,lsory retirement eJective 5ay (% ($$P and so,ght for the -ayment of his retirement +eneAts -,rs,ant to the Collective Bargaining &greement. =owever% his re8,est was not acted ,-on. 3nstead% he was terminated from service eJective 5ay % ($$P. Da1ila Aled a com-laint for constr,ctive illegal dismissal% non0-ayment of retirement +eneAts% ,nder>non0-ayment of wages and other +eneAts of a reg,lar em-loyee. =e contends that the cons,ltancy contract was a scheme to de-rive him of the +eneAts of reg,lariRation. =e s,+mitted% among others% co-ies of his time cards% ?9cial B,siness 3tinerary Sli-s% Daily &ttendance Sheets and other doc,ments in s,--ort of his claim. The cor-oration% on the other hand% asserted that no em-loyer0em-loyee relationshi- e7isted +etween them. 3SSUB* 2as Da1ila an em-loyee of the cor-oration and entitled to the reliefs so,ghtL RUL3NG* The records reveal that +oth the L& and the NLRC% as a9rmed +y the C&% have fo,nd s,+stantial evidence to show that res-ondent Da1ila was a reg,lar em-loyee who was dismissed witho,t ca,se. The L&% as s,stained +y the NLRC% declared res-ondent Da1ila to +e a reg,lar em-loyee on the +asis of the ,nre+,tted doc,mentary evidence showing that he was ,nder the cor-orationIs direct control and s,-ervision and -erformed tas1s that were either incidental or ,s,ally desira+le and necessary in the trade or +,siness of the cor-oration for a -eriod of ten years. There was no showing of -al-a+le error or ar+itrary disregard of evidence in the Andings of the L& and NLRC and th,s s,ch Anding was ado-ted +y the S,-reme Co,rt. Therefore% Da1ila was an em-loyee of the cor-oration th,s entitled to +ac1wages and -ayment of his retirement +eneAts -,rs,ant to the CB&. III. RIGHT TO HIRE IV. WAGES & WAGE RATIONALIZATION V. VIOLATION OF WAGE ORDERS VI. WAGE ENFORCEMENT & RECOVERY A!UINAS SCHOOL, V. SPS. INTON .&NU&RS (!% ($ ' F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch )&CTS* 3n ""' res-ondent .ose L,is 3nton ;.ose L,is< was a grade three st,dent at &8,inas School ;&8,inas<. Res-ondent Sister 5argarita Samyamin ;Samyamin<% a religion teacher who +egan teaching at that school only in .,ne of that year% ta,ght .ose L,is6 grade three religion class. ?n .,ly @% ""'% while Samyamin was writing on the +lac1+oard% .ose L,is left his assigned seat and went over to a classmate to -lay a Co1e of s,r-rising him. Samyamin noticed this and sent .ose L,is +ac1 to his seat. &fter a while% .ose L,is got ,- again and went over to the same classmate. This time% ,na+le to tolerate the child6s +ehavior% Samyamin a--roached .ose L,is and 1ic1ed him on the legs several times. She also -,lled and shoved his head on the classmate6s seat. )inally% she told the child to stay where he was on that s-ot of the room and Anish co-ying the notes on the +lac1+oard while seated on the Toor. .ose and 4ictoria 3nton ;the 3ntons< Aled an action for damages on +ehalf of their son .ose L,is against Samyamin and &8,inas. 3SSUB* whether or not the C& was correct in holding &8,inas solidarily lia+le with Samyamin for the damages awarded to .ose L,is. RUL3NG* The C& fo,nd &8,inas lia+le to .ose L,is +ased on &rticle ('$ of the Civil Code ,-on the C&6s +elief that the school was Samyamin6s em-loyer. &8,inas contests this. The Co,rt has consistently a--lied the Efo,r0fold testE to determine the e7istence of an em-loyer0em-loyee relationshi-* the em-loyer ;a< selects and engages the em-loyeeD ;+< -ays his wagesD ;c< has -ower to dismiss himD and ;d< has control over his wor1. ?f these% the most cr,cial is the element of control. Control refers to the right of the em-loyer% whether act,ally e7ercised or reserved% to control the wor1 of the em-loyee as well as the means and methods +y which he accom-lishes the same. 3n this case% the school directress testiAed that &8,inas had an agreement with a congregation of sisters ,nder which% in order to f,lAll its ministry% the congregation wo,ld send religion teachers to &8,inas to -rovide catechesis to its st,dents. &8,inas insists that it was not the school +,t Samyamin6s religio,s congregation that chose her for the tas1 of catechiRing the school6s grade three st,dents% m,ch li1e the way +isho-s designate the catechists who wo,ld teach religion in -,+lic schools. Under the circ,mstances% it was 8,ite evident that &8,inas did not have control over Samyamin6s teaching methods. The 3ntons had not ref,ted the school directress6 testimony in this regard. Conse8,ently% it was error for the C& to hold &8,inas solidarily lia+le with Samyamin. ?f co,rse% &8,inas still had the res-onsi+ility of ta1ing ste-s to ens,re that only 8,aliAed o,tside catechists are allowed to teach its yo,ng st,dents. 3n this regard% it cannot +e said that &8,inas too1 no ste-s to avoid the occ,rrence of im-ro-er cond,ct towards the st,dents +y their religion teacher. )irst% Samyamin6s transcri-t of records% certiAcates% and di-lomas showed that she was 8,aliAed to teach religion. Second% there is no 8,estion that &8,inas ascertained that Samyamin came from a legitimate religio,s congregation of sisters and that% given her Christian training% the school had reason to ass,me that she wo,ld +ehave -ro-erly towards the st,dents. Third% the school gave Samyamin a co-y of the school6s &dministrative )ac,lty StaJ 5an,al that set the standards for handling st,dents. 3t also re8,ired her to attend a teaching orientation +efore she was allowed to teach +eginning that .,ne of ""'. )o,rth% the school -re0a--roved the content of the co,rse she was to teach to ens,re that she was really catechiRing the st,dents. &nd Afth% the school had a -rogram for s,+Cecting Samyamin to classroom eval,ation. Unfort,nately% since she was new and it was C,st the start of the school year% &8,inas did not have s,9cient o--ort,nity to o+serve her methods. &t any rate% it acted -rom-tly to relieve her of her assignment as soon as the school learned of the incident. 3t cannot +e said that &8,inas was g,ilty of o,tright neglect. SIP FOODHOUSE V. BATOLINA G.R. No. "(@P:% ?CT?BBR % ($$ )&CTS* " F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch The GS3S 5,lti0/,r-ose Coo-erative ;G5/C< is an entity organiRed +y the em-loyees of the Government Service 3ns,rance System ;GS3S<. 3ncidental to its -,r-ose% G5/C wanted to o-erate a canteen in the new GS3S B,ilding% +,t had no ca-a+ility and e7-ertise in this area. Th,s% it engaged the services of the -etitioner S.3./. )ood =o,se ;S3/<% owned +y the s-o,ses &leCandro and Bsther /a+lo% as concessionaire. The res-ondents Restit,to Batolina and nine ;"< others ;the res-ondents< wor1ed as waiters and waitresses in the canteen. 3n )e+r,ary ($$@% G5/C terminated S3/Is Econtract as G5/C concessionaire%E +eca,se of G5/CIs decision Eto ta1e direct investment in and management of the G5/C canteenDE S3/Is contin,ed ref,sal to heed G5/CIs directives for service im-rovementD and the alleged interference of the /a+losI two sons with the o-eration of the canteen.# The termination of the concession contract ca,sed the termination of the res-ondentsI em-loyment% -rom-ting them to Ale a com-laint for illegal dismissal% with money claims 3SSUBS* The -ro-riety of the -etition for review on certiorari raising only 8,estions of fact and not of law as re8,ired +y R,le @# of the R,les of Co,rt. 2?N BB0BR e7ist 2?N the free +oard and lodging S3/ f,rnished the em-loyees cannot o-erate as a set0oJ for the ,nder-ayment of their wages. =BLD* .< 2hile it is the general r,le that the Co,rt may not review fact,al Andings of the C&% we deem it -ro-er to de-art from the r,le and e7amine the facts of the case in view of the conTicting fact,al Andings of the la+or ar+iter% on one hand% and the NLRC and the C&% on the other. 2e now consider the merits of the case. (.< The em-loyer0em-loyee relationshi- iss,e 2hen res-ondents were -revented from entering the -remises as a res,lt of the termination of their concession% they sent a -rotest letter dated &-ril @% ($$@ to G5/C thr, their co,nsel. /ertinent -ortion of the letter* Last 5arch (% ($$@% witho,t any co,rt writ or order% and with the aid of yo,r armed agents% yo, -hysically +arred o,r clients U their em-loyees>hel-ers from entering the said -remises and from -erforming their ,s,al d,ties of serving the food re8,irements of GS3S -ersonnel and others. Clearly% no less than res-ondents% thr, their co,nsel% admitted that com-lainants herein were their em-loyees. That com-lainants were em-loyees of res-ondents is f,rther +olstered +y the fact that res-ondents do not deny that they were the ones who -aid com-lainants salary. 2hen com-lainants charged them of ,nder-ayment% res-ondents even inter-osed the defense of Ale ;sic< +oard and lodging given to com-lainants. The C& r,led o,t S3/Is claim that it was a la+or0only contractor or a mere agent of G5/C. 2e agree with the C&D S3/ and its -ro-rietors co,ld not +e considered as mere agents of G5/C +eca,se they e7ercised the essential elements of an em-loyment relationshi- with the res-ondents s,ch as hiring% -ayment of wages and the -ower of control% not to mention that S3/ o-erated the canteen on its own acco,nt as it -aid a fee for the ,se of the +,ilding and for the -rivilege of r,nning the canteen. The fact that the res-ondents a--lied with G5/C in )e+r,ary ($$@ when it terminated its contract with S3/% is another clear indication that the two entities were se-arate and distinct from each other. 2e th,s see no reason to dist,r+ the C&Is Andings. :.< The res-ondentsIs money claims The free +oard and lodging S3/ f,rnished the em-loyees cannot o-erate as a set0oJ for the ,nder-ayment of their wages. 2e held in 5a+eRa v. National La+or Relations Commission# that the em-loyer cannot sim-ly ded,ct from the em-loyeeIs wages the val,e of the +oard and lodging witho,t satisfying the following re8,irements* ;< -roof that s,ch facilities are c,stomarily f,rnished +y the tradeD ;(< vol,ntary acce-tance in writing +y the em-loyees of the ded,cti+le facilitiesD and ;:< -roof of the fair and reasona+le val,e of the facilities charged. 3t is clear from the records that S3/ failed to com-ly with these re8,irements. SLL VS NLRC 5&RC= (% ($ )&CTS* /rivate res-ondents Roldan Lo-eR ;Lo-eR for +revity< and Danilo CaVete ;CaVete for +revity<% and Bdgardo W,Viga ;W,Viga for +revity< res-ectively% were hired +y -etitioner Lagon in several -roCect for the com-any the last +eing the /LDT &nti-olo% RiRal -roCect. )or this -roCect% W,Viga and CaVete $ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch received only the wage of /@#.$$ daily. The minim,m -rescri+ed wage for RiRal at that time was /!$.$$. Delay in the arrival of the im-orted materials from ),r,1awa Cor-oration the com-any c,t down on overtime wor1 and -rom-ted that anyone who insists on doing overtime wor1 wo,ld have to go home witho,t -ay from the com-any. These -rom-ted res-ondents to go home to Ce+, and their Aled a case for non -ayment of minim,m wage and illegal dismissal against -etitioner. 3SSUB* 2?N allowances given +y -etitioner forms -art of the wage of res-ondents. RUL3NG* 3n an illegal dismissal case against the -etitioner em-loyer% res-ondent em-loyees alleged that they were ,nder-aid. 3n their defence% -etitioner em-loyer alleged that res-ondent em-loyees act,ally received wages higher than the -rescri+ed minim,m. The co,rt r,led that as a general r,le% a -arty who alleged -ayment of wages as a defence has the +,rden of -roving it. 3n la+or cases the +,rden of -roving monetary claims rest with the em-loyer +eca,se the -ertinent -ersonnel Ales% -ayrolls % records and other doc,ments are with the e7cl,sive control and -ossession of the em-loyer. 3n the given case -etioner aside from +are allegation failed to show evidences of -ayment of wages higher than the -rescri+ed minim,m. /etitioner also alleged that the facilities they -rovided sho,ld +e incl,ded in the com-,tation of wages. The co,rt r,led that +efore the val,e of facilities can +e ded,cted from the em-loyeesI wages% the following re8,isites m,st all +e attendant* Arst% -roof m,st +e shown that s,ch facilities are c,stomarily f,rnished +y the tradeD second% the -rovision of ded,cti+le facilities m,st +e vol,ntarily acce-ted in writing +y the em-loyeeD and Anally% facilities m,st +e charged at reasona+le val,e. 5ere availment is not s,9cient to allow ded,ctions from the em-loyees wages. These re8,irements has not +een met in this case. 2herefore% the -etition is denied. PEOPLE"S BROADCASTING SERVICE #BOMBO RADYO PHILS., INC.$, VS. THE SECRETARY OF THE DEPARTMENT OF LABOR AND EMPLOYMENT ET AL., G.R. No. P"!#(% 5arch !% ($( )&CTS* .andeleon .,eRan Aled a com-laint against /eo-leIs Broadcasting Service for illegal ded,ction% non0-ayment of service incentive leave% :th month -ay% -remi,m -ay for holiday and rest day and illegal dimin,tion of +eneAts% delayed -ayment of wages and non0coverage of SSS% /&G03B3G and /hilhealth +efore the De-artment of La+or and Bm-loyment Regional ?9ce. ?n the +asis of the com-laint% the D?LB cond,cted a -lant level ins-ection. D,ring the ins-ection% /BS denied em-loyee0em-loyer relationshi- with .,eRan. 3n the 3ns-ection Re-ort )orm% the La+or 3ns-ector wrote non0dimin,tion of +eneAts. /BS was re8,ired to rectify the violations within Ave days from recei-t% +,t there was no rectiAcation eJected. Th,s% s,mmary investigations were cond,cted. The D?LB Regional Director r,led that .,eRan was an em-loyee of /BS% and was entitled to his money claims. /BS so,ght reconsideration of the DirectorIs ?rder% +,t failed. The &cting D?LB Secretary dismissed /BSI a--eal on the gro,nd that it s,+mitted a Deed of &ssignment of Ban1 De-osit instead of -osting a cash or s,rety +ond. 2hen the matter was +ro,ght +efore the C&% where /BS claimed that it had +een denied d,e -rocess% it was held that it was accorded d,e -rocess as it had +een given the o--ort,nity to +e heard% and that the D?LB Secretary had C,risdiction over the matter% as the C,risdictional limitation im-osed +y &rticle (" of the La+or Code on the -ower of the D?LB Secretary ,nder &rt. (';+< of the Code had +een re-ealed +y Re-,+lic &ct No. PP:$. 3SSUBS* 2hat is the e7tent of the D?LBIs visitorial and enforcement -ower ,nder the La+or Code% as amendedL 5ay the D?LB ma1e a determination of whether or not an em-loyer0 em-loyee relationshi- e7ists% and if so% to what e7tentL RUL3NG* Under &rt. (" of the La+or Code% the -ower of the D?LB and its d,ly a,thoriRed hearing o9cers to hear and decide any matter involving the recovery of wages and other monetary claims and +eneAts was 8,aliAed +y the -roviso that the com-laint not incl,de a claim for reinstatement% or that the aggregate money claims not e7ceed /h/ #%$$$. R& PP:$% or an &ct F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch ),rther Strengthening the 4isitorial and Bnforcement /owers of the Secretary of La+or% did away with the /h/ #%$$$ limitation% allowing the D?LB Secretary to e7ercise its visitorial and enforcement -ower for claims +eyond /h/ #%$$$. The only 8,aliAcation to this e7-anded -ower of the D?LB was only that there still +e an e7isting em-loyer0em-loyee relationshi-. No limitation in the law was -laced ,-on the -ower of the D?LB to determine the e7istence of an em-loyer0em-loyee relationshi-. No -roced,re was laid down where the D?LB wo,ld only ma1e a -reliminary Anding% that the -ower was -rimarily held +y the NLRC. The law did not say that the D?LB wo,ld Arst see1 the NLRCIs determination of the e7istence of an em-loyer0em-loyee relationshi-% or that sho,ld the e7istence of the em-loyer0em-loyee relationshi- +e dis-,ted% the D?LB wo,ld refer the matter to the NLRC. The D?LB m,st have the -ower to determine whether or not an em-loyer0em-loyee relationshi- e7ists% and from there to decide whether or not to iss,e com-liance orders in accordance with &rt. (';+< of the La+or Code% as amended +y R& PP:$. The D?LB% in determining the e7istence of an em-loyer0em-loyee relationshi-% has a ready set of g,idelines to follow% the same g,ide the co,rts themselves ,se. The elements to determine the e7istence of an em-loyment relationshi- are* ;< the selection and engagement of the em-loyeeD ;(< the -ayment of wagesD ;:< the -ower of dismissalD ;@< the em-loyerIs -ower to control the em-loyeeIs cond,ct. The ,se of this test is not solely limited to the NLRC. The D?LB Secretary% or his or her re-resentatives% can ,tiliRe the same test% even in the co,rse of ins-ection% ma1ing ,se of the same evidence that wo,ld have +een -resented +efore the NLRC. The determination of the e7istence of an em-loyer0em-loyee relationshi- +y the D?LB m,st +e res-ected. The e7-anded visitorial and enforcement -ower of the D?LB granted +y R& PP:$ wo,ld +e rendered n,gatory if the alleged em-loyer co,ld% +y the sim-le e7-edient of dis-,ting the em-loyer0 em-loyee relationshi-% force the referral of the matter to the NLRC. The Co,rt iss,ed the declaration that at least a -rima facie showing of the a+sence of an em-loyer0em-loyee relationshi- +e made to o,st the D?LB of C,risdiction. B,t it is -recisely the D?LB that will +e faced with that evidence% and it is the D?LB that will weigh it% to see if the same does s,ccessf,lly ref,te the e7istence of an em-loyer0em-loyee relationshi-. 3f the D?LB ma1es a Anding that there is an e7isting em-loyer0em-loyee relationshi-% it ta1es cogniRance of the matter% to the e7cl,sion of the NLRC. The D?LB wo,ld have no C,risdiction only if the em-loyer0em-loyee relationshi- has already +een terminated% or it a--ears% ,-on review% that no em-loyer0em-loyee relationshi- e7isted in the Arst -lace. The Co,rt% in limiting the -ower of the D?LB% gave the rationale that s,ch limitation wo,ld eliminate the -ros-ect of com-eting concl,sions +etween the D?LB and the NLRC. The -ros-ect of com-eting concl,sions co,ld C,st as well have +een eliminated +y according res-ect to the D?LB Andings% to the e7cl,sion of the NLRC% and this 2e +elieve is the more -r,dent co,rse of action to ta1e. This is not to say that the determination +y the D?LB is +eyond 8,estion or review. S,9ce it to say% there are C,dicial remedies s,ch as a -etition for certiorari ,nder R,le !# that may +e availed of% sho,ld a -arty wish to dis-,te the Andings of the D?LB. 3t m,st also +e remem+ered that the -ower of the D?LB to determine the e7istence of an em-loyer0em-loyee relationshi- need not necessarily res,lt in an a9rmative Anding. The D?LB may well ma1e the determination that no em-loyer0em-loyee relationshi- e7ists% th,s divesting itself of C,risdiction over the case. 3t m,st not +e -recl,ded from +eing a+le to reach its own concl,sions% not +y the -arties% and certainly not +y this Co,rt. Under &rt. (';+< of the La+or Code% as amended +y R& PP:$% the D?LB is f,lly em-owered to ma1e a determination as to the e7istence of an em-loyer0em-loyee relationshi- in the e7ercise of its visitorial and enforcement -ower% s,+Cect to C,dicial review% not review +y the NLRC. There is a view that des-ite &rt. (';+< of the La+or Code% as amended +y R& PP:$% there is still a threshold amo,nt set +y &rts. (" and (P of the La+or Code when money claims are involved% i.e.% that if it is for /h/ #%$$$ and +elow% the C,risdiction is with the regional director of the D?LB% ,nder &rt. ("% and if the amo,nt involved e7ceeds /h/ #%$$$% the C,risdiction is with the la+or ar+iter% ,nder &rt. (P. The view states that des-ite the wording of &rt. (';+<% this wo,ld only a--ly in the co,rse of reg,lar ins-ections ,nderta1en +y the D?LB% as diJerentiated from cases ,nder &rts. (" and (P% which originate from com-laints. There are several cases% however% where the Co,rt has r,led that &rt. (';+< has +een amended to e7-and the -owers of the D?LB Secretary and his d,ly a,thoriRed re-resentatives +y R& PP:$. 3n these cases% the Co,rt resolved ( F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch that the D?LB had the C,risdiction% des-ite the amo,nt of the money claims involved. ),rthermore% in these cases% the ins-ection held +y the D?LB regional director was -rom-ted s-eciAcally +y a com-laint. Therefore% the initiation of a case thro,gh a com-laint does not divest the D?LB Secretary or his d,ly a,thoriRed re-resentative of C,risdiction ,nder &rt. (';+<. To reca-it,late% if a com-laint is +ro,ght +efore the D?LB to give eJect to the la+or standards -rovisions of the La+or Code or other la+or legislation% and there is a Anding +y the D?LB that there is an e7isting em-loyer0 em-loyee relationshi-% the D?LB e7ercises C,risdiction to the e7cl,sion of the NLRC. 3f the D?LB Ands that there is no em-loyer0em-loyee relationshi-% the C,risdiction is -ro-erly with the NLRC. 3f a com-laint is Aled with the D?LB% and it is accom-anied +y a claim for reinstatement% the C,risdiction is -ro-erly with the La+or &r+iter% ,nder &rt. (P;:< of the La+or Code% which -rovides that the La+or &r+iter has original and e7cl,sive C,risdiction over those cases involving wages% rates of -ay% ho,rs of wor1% and other terms and conditions of em-loyment% if accom-anied +y a claim for reinstatement. 3f a com-laint is Aled with the NLRC% and there is still an e7isting em-loyer0em-loyee relationshi-% the C,risdiction is -ro-erly with the D?LB. The Andings of the D?LB% however% may still +e 8,estioned thro,gh a -etition for certiorari ,nder R,le !# of the R,les of Co,rt. 3n the -resent case% the Anding of the D?LB Regional Director that there was an em-loyer0em-loyee relationshi- has +een s,+Cected to review +y this Co,rt% with the Anding +eing that there was no em-loyer0em-loyee relationshi- +etween -etitioner and -rivate res-ondent% +ased on the evidence -resented. /rivate res-ondent -resented self0serving allegations as well as self0 defeating evidence. The Andings of the Regional Director were not +ased on s,+stantial evidence% and -rivate res-ondent failed to -rove the e7istence of an em-loyer0em-loyee relationshi-. The D?LB had no C,risdiction over the case% as there was no em-loyer0em-loyee relationshi- -resent. Th,s% the dismissal of the com-laint against -etitioner is -ro-er. SUPERIOR PACKAGING V. BALAGSAY GR N?. P'"$"% ?CT?BBR $% ($( )&CTS* The -etitioner engaged the services of Lancer to -rovide reliever services to its +,siness% which involves the man,fact,re and sale of commercial and ind,strial corr,gated +o7es. /,rs,ant to a com-laint Aled +y the res-ondents against the -etitioner and its /resident% Cesar L,R ;L,R<% for ,nder-ayment of wages% non0 -ayment of -remi,m -ay for wor1ed rest% overtime -ay and non0-ayment of salary% the De-artment of La+or and Bm-loyment ;D?LB< cond,cted an ins-ection of the -etitionerIs -remises and fo,nd several violations. D?LB% in this case% in the e7ercise of the its visitorial and enforcement -ower% determined em-loyer0em-loyee relationshi-. 3SSUB* 2?N D?LB has the a,thority to ma1e a Anding of an em-loyer0em-loyee relationshi- concomitant to its visitorial and enforcement -ower RUL3NG* Ses. &t any rate% s,ch arg,ment lac1s merit. The D?LB clearly acted within its a,thority when it determined the e7istence of an em-loyer0 em-loyee relationshi- +etween the -etitioner and res-ondents as it falls within the -,rview of its visitorial and enforcement -ower ,nder &rticle (';+< of the La+or Code% which -rovides* Notwithstanding the -rovisions of &rticles (" and (P of this Code to the contrary% and in cases where the relationshi- of em-loyer0em-loyee still e7ists% the Secretary of La+or and Bm-loyment or his d,ly a,thoriRed re-resentatives shall have the -ower to iss,e com-liance orders to give eJect to the la+or standards -rovisions of this Code and other la+or legislation +ased on the Andings of la+or em-loyment and enforcement o9cers or ind,strial safety engineers made in the co,rse of ins-ection. The Secretary or his d,ly a,thoriRed re-resentative shall iss,e writs of e7ec,tion to the a--ro-riate a,thority for the enforcement of their orders% e7ce-t in cases where the em-loyer contests the Andings of the la+or em-loyment and enforcement o9cer and raises iss,es s,--orted +y doc,mentary -roofs which were not considered in the co,rse of ins-ection. 3n /eo-leIs Broadcasting ;Bom+o Radyo /hils.% 3nc.< v. Secretary of the De-artment of La+or and Bm-loyment% the Co,rt stated that it can +e ass,med that the D?LB in the e7ercise of its visitorial and enforcement -ower somehow has to ma1e a determination of the e7istence of an em-loyer0em-loyee relationshi-. S,ch determination% however% is merely -reliminary% incidental and collateral to the D?LBIs -rimary f,nction of enforcing la+or standards -rovisions. S,ch -ower was f,rther e7-lained : F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch recently +y the Co,rt in its Resol,tion dated 5arch !% ($( iss,ed in /eo-leIs Broadcasting% viR* The determination of the e7istence of an em-loyer0em-loyee relationshi- +y the D?LB m,st +e res-ected. The e7-anded visitorial and enforcement -ower of the D?LB granted +y R& PP:$ wo,ld +e rendered n,gatory if the alleged em-loyer co,ld% +y the sim-le e7-edient of dis-,ting the em-loyer0em-loyee relationshi-% force the referral of the matter to the NLRC. The Co,rt iss,ed the declaration that at least a -rima facie showing of the a+sence of an em-loyer0em-loyee relationshi- +e made to o,st the D?LB of C,risdiction. B,t it is -recisely the D?LB that will +e faced with that evidence% and it is the D?LB that will weigh it% to see if the same does s,ccessf,lly ref,te the e7istence of an em-loyer0 em-loyee relationshi-. 7777 7 7 7 MTNhe -ower of the D?LB to determine the e7istence of an em-loyer0em-loyee relationshi- need not necessarily res,lt in an a9rmative Anding. The D?LB may well ma1e the determination that no em-loyer0em-loyee relationshi- e7ists% th,s divesting itself of C,risdiction over the case. 3t m,st not +e -recl,ded from +eing a+le to reach its own concl,sions% not +y the -arties% and certainly not +y this Co,rt. Under &rt. (';+< of the La+or Code% as amended +y R& PP:$% the D?LB is f,lly em-owered to ma1e a determination as to the e7istence of an em-loyer0em-loyee relationshi- in the e7ercise of its visitorial and enforcement -ower% s,+Cect to C,dicial review% not review +y the NLRC. &lso% the e7istence of an em-loyer0em-loyee relationshi- is ,ltimately a 8,estion of fact. The determination made in this case +y the D?LB% al+eit -rovisional% and as a9rmed +y the Secretary of D?LB and the C& is +eyond the am+it of a -etition for review on certiorari. VII. WAGE PROTECTION PROVISIONS KIMBERLY%CLARK PHILIPPINES, INC. vs. DIMAYUGA G.R. N?. PPP$#% SB/TB5BBR '% ($$" )&CTS* Nora% Rosemarie and 5aricar were em-loyees of Xim+erly0Clar1 /hili--ines% 3nc. ;-etitioner<. ?n Se-tem+er "% ($$(% Nora tendered her resignation eJective ?cto+er (% ($$(. ?n ?cto+er P% ($$(% Rosemarie tendered her resignation% also eJective ?cto+er (% ($$(. &s -etitioner had +een e7-eriencing a downward trend in its sales% it created a ta70free early retirement -ac1age for its em-loyees as a cost0 c,tting and streamlining meas,re. Twenty0fo,r of its em-loyees availed of the oJer that was made availa+le from Novem+er $0:$% ($$(. Des-ite their resignation +efore the early retirement -ac1age was oJered% Nora and Rosemarie -leaded with -etitioner that they +e retroactively e7tended the +eneAts there,nder% to which -etitioner acceded. =ence% Nora received a total of /%$(#%:.P: while Rosemarie received a total of /%$$!%@":."@% in consideration of which they e7ec,ted release and 8,itclaim deeds dated .an,ary P% ($$: and .an,ary !% ($$:% res-ectively. ?n Novem+er @% ($$(% 5aricar tendered her resignation eJective Decem+er % ($$(% citing career advancement as the reason therefor. &s at the time of her resignation the early retirement -ac1age was still eJective% she received a total of /#(:%#@$.: for which she signed a release and 8,itclaim. ?n Novem+er ('% ($$(% -etitioner anno,nced that in lie, of the merit increase which it did not give that year% it wo,ld -rovide economic assistance% to +e released the following day% to all monthly0-aid em-loyees on reg,lar stat,s as of Novem+er !% ($$(. Still later or on .an,ary !% ($$:% -etitioner anno,nced that it wo,ld grant a l,m- s,m retirement -ay in the amo,nt of/($$%$$$% in addition to the early retirement -ac1age +eneAt% to those who signed ,- for early retirement and who wo,ld sign ,- ,ntil .an,ary ((% ($$:. 3SSUBS* 2hether or not the res-ondents are entitled to the l,m- s,m retirement -ay of /($$%$$$% 5aricar to the early retirement -ac1age and% Nora and Rosemarie to the economic assistance 2hether or not the release and 8,itclaim deeds are valid RUL3NG* They are not entitled to these +eneAts. Lump sum Retirement Pay 3t is settled that entitlement of em-loyees to retirement +eneAts m,st s-eciAcally +e granted ,nder e7isting laws% a collective +argaining @ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch agreement or em-loyment contract% or an esta+lished em-loyer -olicy. No law or collective +argaining agreement or other a--lica+le contract% or an esta+lished com-any -olicy was e7isting d,ring res-ondentsI em-loyment entitling them to the/($$%$$$ l,m-0s,m retirement -ay. /etitioner was not th,s o+liged to grant them s,ch -ay. Res-ondents nevertheless arg,e that since other em-loyees who resigned +efore the anno,ncement of the grant of the l,m- s,m retirement -ay received the same% they ;res-ondents< sho,ld also receive it. 3n the -resent case% Nora and Rosemarie resigned -rior to -etitionerIs oJer of the l,m- s,m retirement -ay as an incentive to those em-loyees who wo,ld vol,ntarily avail of its early retirement scheme as a cost0c,tting and streamlining meas,re. That res-ondents resigned% and not retrenched% is clear from their res-ective letters to -etitioner. &nd nowhere in the letters is there any allegation that they resigned in view of the com-anyIs downward trend in sales which necessitated downsiRing or streamlining. &s for 5aricarIs claim to the l,m- s,m retirement -ay% the Co,rt Ands that% li1e Nora and Rosemarie% she is not entitled to it. <ho,gh the incentive was oJered when she was still connected with -etitioner% she resigned from em-loyment% citing career advancement as the reason therefor. 3nd,+ita+ly% the incentive was addressed to those em-loyees who% witho,t -rior -lans of resigning% o-ted to terminate their em-loyment in light of the downsiRing +eing ,nderta1en +y -etitioner. 3n other words% 5aricar resigned from -etitioner in order to And gainf,l em-loyment elsewhere a reason which has no +earing on the Anancial via+ility of -etitioner. Early Retirement Package /etitionerIs claim that it allowed Nora and Rosemarie to avail of the early retirement -ac1age des-ite their -revio,s se-aration from the com-any o,t of -,re generosity is well0ta1en in light of NoraIs letter of Se-tem+er #% ($$( as1ing if she co,ld avail of the early retirement -ac1age as Kit wo,ld certainly +e of great assistance to ,s Anancially.O 3t is th,s a+s,rd to fa,lt -etitioner for acceding to s,ch a re8,est o,t of com-assion +y directing it to -ay additional +eneAts to resigned em-loyees who are not entitled thereto. /etitionerIs decision to e7tend the +eneAt to some former em-loyees who had already resigned +efore the oJer of the l,m- s,m -ay incentive was th,s an act of generosity which it is not o+liged to e7tend to res-ondents. &-ro-os is this Co,rtIs r,ling in B,sinessday* 2ith regard to the -rivate res-ondentsI claim for the mid0year +on,s% it is settled doctrine that the grant of a +on,s is a -rerogative% not an o+ligation% of the em-loyer. The matter of giving a +on,s over and a+ove the wor1erIs lawf,l salaries and allowances is entirely de-endent on the Anancial ca-a+ility of the em-loyer to give it. The fact that the com-anyIs +,siness was no longer -roAta+le ;it was in fact mori+,nd< -l,s the fact that the -rivate res-ondents did not wor1 ,- to the middle of the year ;they were discharged in 5ay ""'< were valid reasons for not granting them a mid0year +on,s. Re8,iring the com-any to -ay a mid0year +on,s to them also wo,ld in eJect -enaliRe the com-any for its generosity to those wor1ers who remained with the com-any Ktill the endO of its days. Economic Assistance Neither are Nora and Rosemarie entitled to the economic assistance which -etitioner awarded to Kall monthly em-loyees who are ,nder reg,lar stat,s as of Novem+er !% ($$(%O they having resigned earlier or on ?cto+er (% ($$(. The Co,rt Ands that the economic assistance was a +on,sover and a+ove the em-loyeesI salaries and allowances. The grant of economic assistance to all monthly em-loyees ,nder reg,lar stat,s as of Novem+er !% ($$( was th,s well within -etitionerIs -rerogatives. 5oreover% -etitionerIs decision to give economic assistance was arrived at more than a month after res-ondentsI resignation and% therefore% it was a +eneAt not yet e7isting at the time of their se-aration. 3n any event% ass,ming that Nora and Rosemarie are entitled to the economic assistance% they had signed release and 8,itclaim deeds ,-on their resignation in which they waived. The 8,itclaims are valid and +inding. 2hile 8,itclaims e7ec,ted +y em-loyees are commonly frowned ,-on as +eing contrary to -,+lic -olicy and are ineJective to +ar claims for the f,ll meas,re of their legal rights% where the -erson ma1ing the waiver has done so vol,ntarily% with a f,ll ,nderstanding thereof% and the consideration for the 8,itclaim is credi+le and reasona+le% the transaction m,st +e recogniRed as +eing a valid and +inding ,nderta1ing. 3n the case at +ar% Nora and Rosemarie are &cco,nting grad,ates. They have not alleged having +een com-elled to sign the 8,itclaims% nor that the considerations thereof ;/%$(@%:.P: for Nora and /!'(%P(.(@ for Rosemarie< are ,nconsciona+le. LEPANTO CERAMICS V. LEPANTO CERAMICS EMPLOYEES ASSOC. G.R. No. '$'!!% 5&RC= (% ($$ )&CTS* # F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch /etitioner LC3 is a domestic cor-oration engaged -rimarily to man,fact,re% ma1e% +,y and sell% on wholesale +asis% among others% tiles% mar+les% mosaics and other similar -rod,ctsD while res-ondent LCB& is a legitimate la+or organiRation d,ly registered with D?LB% which is the sole and e7cl,sive +argaining agent of LC3. 3n Se-tem+er """% LC3 and LCB& entered into a CB& which -rovides for% among others% the grant of a Christmas gift -ac1age>+on,s to the mem+ers of the res-ondent &ssociation. The Christmas +on,s was one of the en,merated Ee7isting +eneAt% -ractice of traditional rightsE which Eshall remain in f,ll force and eJect.E 3n the s,cceeding years% """% ($$$ and ($$% the +on,s was not in cash. 3nstead% LC3 gave each of the mem+ers of LCB& Tile Redem-tion CertiAcates e8,ivalent to /:%$$$.$$. The +on,s for the year ($$( is the root of the -resent dis-,te% where LC3 gave a year0end cash +eneAt of !$$ and oJered a cash advance to interested em-loyees e8,ivalent to one ;< month salary -aya+le in one year. LC3 o+Cected to the /!$$.$$ cash +eneAt and arg,ed that this was in violation of the CB&. LCB& insisted that it has +een the traditional -ractice of the com-any to grant its mem+ers Christmas +on,ses d,ring the end of the calendar year% each in the amo,nt of /:%$$$.$$% while LC3 arg,ed that the giving of e7tra com-ensation was +ased on the com-any6s availa+le reso,rces for a given year and the wor1ers are not entitled to a +on,s if the com-any does not ma1e -roAts% th,s a management -rerogative. 3SSUB* 3s LC3 o+liged to give the mem+ers of the LCB& a Christmas +on,s in the amo,nt of /:%$$$.$$ in ($$(L RUL3NG* The -etition was denied. By deAnition% a E+on,sE is a grat,ity or act of li+erality of the giver. 3t is something given in addition to what is ordinarily received +y or strictly d,e the reci-ient. & +on,s is granted and -aid to an em-loyee for his ind,stry and loyalty which contri+,ted to the s,ccess of the em-loyer6s +,siness and made -ossi+le the realiRation of -roAts. & +on,s is also granted +y an enlightened em-loyer to s-,r the em-loyee to greater eJorts for the s,ccess of the +,siness and realiRation of +igger -roAts. Generally% a +on,s is not a demanda+le and enforcea+le o+ligation. )or a +on,s to +e enforcea+le% it m,st have +een -romised +y the em-loyer and e7-ressly agreed ,-on +y the -arties. Given that the +on,s in this case is integrated in the CB&% the same -arta1es the nat,re of a demanda+le o+ligation. 4erily% +y virt,e of its incor-oration in the CB&% the Christmas +on,s d,e to LCB& has +ecome more than C,st an act of generosity on the -art of the -etitioner +,t a contract,al o+ligation it has ,nderta1en. 3t is a familiar and f,ndamental doctrine in la+or law that the CB& is the law +etween the -arties and they are o+liged to com-ly with its -rovisions. This -rinci-le stands strong and tr,e in the case at +ar. & reading of the -rovision of the CB& reveals that the same -rovides for the giving of a EChristmas gift -ac1age>+on,sE witho,t 8,aliAcation. Terse and clear% the said -rovision did not state that the Christmas -ac1age shall +e made to de-end on the -etitioner6s Anancial standing. 3f the -arties intended that the /:%$$$.$$ +on,s wo,ld +e de-endent on the com-any earnings% s,ch intention sho,ld have +een e7-ressed in the CB&. 3t is noteworthy that LC3 cannot insist on +,siness losses as a +asis for disregarding its ,nderta1ing% +eca,se it still granted in ""'0($$ the :%$$$ +on,s des-ite the imminence and -ossi+ility of +,siness losses owing to the ""P Anancial crisis. The r,le is settled that any +eneAt and s,--lement +eing enCoyed +y the em-loyees cannot +e red,ced% diminished% discontin,ed or eliminated +y the em-loyer. The -rinci-le of non0dimin,tion of +eneAts is fo,nded on the constit,tional mandate to -rotect the rights of wor1ers and to -romote their welfare and to aJord la+or f,ll -rotection. SHS PERFORATED VS. DIA& GR No. '#'@D ?cto+er :% ($$ )&CTS* /etitioner S=S /erforated 5aterials% 3nc. (SHS) is a start0,- cor-oration organiRed and e7isting ,nder the laws of the Re-,+lic of the /hili--ines and registered with the /hili--ine Bconomic Wone &,thority. /etitioners% 2infried =artmannshenn (Hartmannshenn) is the /resident of S=S while =inrich .ohann Sch,macher (Schumacher) is the treas,rer and one of the +oard directors. ! F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch 5an,el ). DiaR ;res-ondent< was hired +y -etitioner S=S as 5anager for B,siness Develo-ment.
& series of events occ,rred which led to the termination of em-loyment of res-ondent. Res-ondent tendered his resignation. /etitioners averred that res-ondent was ,na+le to give a -ro-er e7-lanation for his +ehavior. =artmannshenn then acce-ted res-ondentIs resignation and informed him that his salary wo,ld +e released ,-on e7-lanation of his fail,re to re-ort to wor1% and -roof that he did% in fact% wor1 for the -eriod in 8,estion. Res-ondent sent =artmannshenn and Sch,macher an electronic mail message a--ealing for the release of his salary. ¬her demand letter for res-ondentIs accr,ed salary for Novem+er ! to Novem+er :$% ($$#% : th month -ay% moral and e7em-lary damages% and attorneyIs fees was sent on Decem+er (% ($$#. ?n Decem+er "% ($$#% res-ondent Aled a Com-laintagainst the -etitioners for illegal dismissalD non0-ayment of salaries>wages and : th month -ay with -rayer for reinstatement and f,ll +ac1wagesD e7em-lary damages% and attorneyIs fees% costs of s,it% and legal interest. /etitioners contend that withholding res-ondentIs salary from Novem+er ! to Novem+er :$% ($$#% was C,stiAed +eca,se res-ondent was a+sent and did not show ,- for wor1 d,ring that -eriod. =e also failed to acco,nt for his wherea+o,ts and wor1 accom-lishments d,ring said -eriod. 2hen there is an iss,e as to whether an em-loyee has% in fact% wor1ed and is entitled to his salary% it is within management -rerogative to tem-orarily withhold an em-loyeeIs salary>wages -ending determination of whether or not s,ch em-loyee did indeed wor1.
3SSUB* 2hether or not the withholding of res-ondentIs salary is valid. RUL3NG* 2e disagree with -etitioners.
5anagement -rerogative refers Kto the right of an em-loyer to reg,late all as-ects of em-loyment% s,ch as the freedom to -rescri+e wor1 assignments% wor1ing methods% -rocesses to +e followed% reg,lation regarding transfer of em-loyees% s,-ervision of their wor1% lay0oJ and disci-line% and dismissal and recall of wor1.O <ho,gh management -rerogative refers to Kthe right to reg,late all as-ects of em-loyment%O it cannot +e ,nderstood to incl,de the right to tem-orarily withhold salary>wages witho,t the consent of the em-loyee. To sanction s,ch an inter-retation wo,ld +e contrary to &rticle ! of the La+or Code% which -rovides*
&RT. !.Withholding of wages and kickacks prohiited! 3t shall +e ,nlawf,l for any -erson% directly or indirectly% to withhold any amo,nt from the wages of a wor1er or ind,ce him to give ,- any -art of his wages +y force% stealth% intimidation% threat or +y any other means whatsoever witho,t the wor1erIs consent.
&ny withholding of an em-loyeeIs wages +y an em-loyer may only +e allowed in the form of wage ded,ctions ,nder the circ,mstances -rovided in &rticle : of the La+or Code% as set forth +elow*
&RT. :.Wage "eduction! No em-loyer% in his own +ehalf or in +ehalf of any -erson% shall ma1e any ded,ction from the wages of his em-loyees% e7ce-t*
;a< 3n cases where the wor1er is ins,red with his consent +y the em-loyer% and the ded,ction is to recom-ense the em-loyer for the amo,nt -aid +y him as -remi,m on the ins,ranceD ;+< )or ,nion d,es% in cases where the right of the wor1er or his ,nion to chec10oJ has +een recogniRed +y the em-loyer or a,thoriRed in writing +y the individ,al wor1er concernedD and ;c< 3n cases where the em-loyer is a,thoriRed +y law or reg,lations iss,ed +y the Secretary of La+or.
&s correctly -ointed o,t +y the L&% Ka+sent a showing that the withholding of com-lainantIs wages falls ,nder the e7ce-tions -rovided in &rticle :% the withholding thereof is th,s ,nlawf,l.O
<ho,gh it cannot +e determined with certainty whether res-ondent wor1ed for the entire -eriod from Novem+er ! to Novem+er :$% ($$#% the consistent r,le is that if do,+t e7ists +etween the evidence -resented +y the em-loyer and that +y the em-loyee% the scales of C,stice m,st +e tilted in favor of the latter in line with the -olicy mandated +y &rticles ( and : of the La+or Code to aJord -rotection to la+or and constr,e do,+ts in favor of la+or. )or -etitionersI fail,re to satisfy their +,rden of -roof% res-ondent is -res,med to have wor1ed d,ring the -eriod in 8,estion and is% accordingly% P F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch entitled to his salary. Therefore% the withholding of res-ondentIs salary +y -etitioners is contrary to &rticle ! of the La+or Code and% th,s% ,nlawf,l. NINA EWELRY V. MONTECILLO N?4B5BBR ('% ($ )&CTS* ?n &,g,st :% ($$@% NiVa .ewelry im-osed a -olicy for goldsmiths re8,iring them to -ost cash +onds or de-osits in varying amo,nts +,t in no case e7ceeding #Q of the latter6s salaries -er wee1. The de-osits were intended to answer for any loss or damage which NiVa .ewelry may s,stain +y reason of the goldsmiths6 fa,lt or negligence in handling the gold entr,sted to them. The de-osits shall +e ret,rned ,-on com-letion of the goldsmiths6 wor1 and after an acco,nting of the gold received. Said res-ondents deAed same -olicy and were considered constr,ctively dismissed +y the com-any% who only alleged that they sto--ed re-orting to wor1. Res-ondents then Aled com-laint +,t same was dismissed +y the La+or &r+iter% only awarding them their :th month -ay. They then elevated their com-laint to the NLCR min,s the already0won :th month -ay. &--lying &rticle : and @ of the La+or Code% the C& r,led in favor and awarding res-ondents. =ence this -etition for review 3SSUBS* 2hether or not the re8,irement of -osting cash +onds or have the same ded,cted from the wor1erIs salaries is -ro-er. =BLD* N?. 2hile em-loyers sho,ld generally +e given leeways in their e7ercise of management -rerogatives% we agree with the res-ondents and the C& that in the case at +ar% the -etitioners had failed to -rove that their im-osition of the new -olicy ,-on the goldsmiths ,nder NiVa .ewelry6s em-loy falls ,nder the e7ce-tions s-eciAed in &rticles : and @ of the La+or Code. 2hile the -etitioners are not a+sol,tely -recl,ded from im-osing the new -olicy% they can only do so ,-on com-liance with the re8,irements of the law. 3n other words% the -etitioners sho,ld Arst esta+lish that the ma1ing of ded,ctions from the salaries is a,thoriRed +y law% or reg,lations iss,ed +y the Secretary of La+or. ),rther% the -osting of cash +onds sho,ld +e -roven as a recogniRed -ractice in the Cewelry man,fact,ring +,siness% or alternatively% the -etitioners sho,ld see1 for the determination +y the Secretary of La+or thro,gh the iss,ance of a--ro-riate r,les and reg,lations that the -olicy the former see1s to im-lement is necessary or desira+le in the cond,ct of +,siness. The -etitioners failed in this res-ect. 3t +ears stressing that witho,t -roofs that re8,iring de-osits and eJecting ded,ctions are recogniRed -ractices% or witho,t sec,ring the Secretary of La+or6s determination of the necessity or desira+ility of the same% the im-osition of new -olicies relative to ded,ctions and de-osits can +e made s,+Cect to a+,se +y the em-loyers. This is not what the law intends. VIII. PAYMENT OF WAGES IX. CONDITIONS OF EMPLOYMENT X. MINIMUM LABOR STANDARD BENEFITS RADIO MINDANAO NETWORK, INC. AND ERIC S. CANOY VS. DOMINGO &. YBAROLA, ET AL. G.R. N?. "'!!(. SB/TB5BBR (% ($( )&CTS* Res-ondents Domingo W. S+arola% .r. and &lfonso B. Rivera% .r. were hired on .,ne #% "PP and .,ne % "':% res-ectively% +y R5N. They event,ally +ecame acco,nt managers% soliciting advertisements and servicing vario,s clients of R5N. =owever% the res-ondentsI services were terminated as a res,lt of R5NIs reorganiRation>restr,ct,ringD they were given their se-aration -ay /!:%(#$.$$ for S+arola% and /@'%(#$.$$ for Rivera. Sometime in ($$(% they e7ec,ted release>8,itclaim a9davits. DissatisAed with their se-aration -ay% the res-ondents Aled se-arate com-laints ;which were later consolidated< against R5N and its /resident% Bric S. Canoy% for illegal dismissal with several money claims% incl,ding attorneyIs fees. They indicated that their monthly salary rates were /!$%$$$.$$ for S+arola and /@$%$$$.$$ for Rivera. ' F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch La+or &r+iter /atricio Li+o0on dismissed the illegal dismissal com-laint% +,t ordered the -ayment of additional se-aration -ay to the res-ondents /@"$%$!!.$$ for S+arola and /@("%#P.## for Rivera. ?n a--eal +y the -etitioners to the National La+or Relations Commission ;NLRC<% the NLRC set aside the la+or ar+iterIs decision and dismissed the com-laint for lac1 of merit. B,t the NLRC ,-held the validity of the res-ondentsI 8,itclaim a9davits as they failed to show that they were forced to e7ec,te the doc,ments. )rom the NLRC% the res-ondents so,ght relief from the C& thro,gh a -etition for certiorari ,nder R,le !# of the R,les of Co,rt. 3n its decision% the C& granted the -etition and set aside the assailed NLRC dis-ositions. 3SSUBS* Sho,ld the commissions earned +y the res-ondents +e incl,ded in the com-,tation of their se-aration -ayL 2ere the 8,itclaims iss,ed +y the res-ondents invalidL RUL3NG* The Co,rt is not convinced with -etitioners claim that the commissions were not -art of the salaries. 3f these commissions had +een really -roAt0 sharing +on,ses to the res-ondents% they sho,ld have received the same amo,nts% yet% as the NLRC itself noted% S+arola and Rivera received /:P(%P:. and /#'!%""'.#$ commissions% res-ectively% in($$(. The variance in amo,nts the res-ondents received as commissions s,--orts the C&Is Anding that the salary str,ct,re of the res-ondents was s,ch that they only received a minimal amo,nt as g,aranteed wageD a greater -art of their income was derived from the commissions they get from soliciting advertisementsD these advertisements are the K-rod,ctsO they sell. &s the C& a-tly noted% this 1ind of salary str,ct,re does not detract from the character of the commissions +eing -art of the salary or wage -aid to the em-loyees for services rendered to the com-any 2ith regards to the 8,itclaims% -etitionersI reliance on o,r r,ling in Talam v. National La+orRelations Commission% regarding the K-ro-er a--reciation of 8,itclaims%Oas they -,t it% is mis-laced. 2hile Talam% in the cited case% and S+arola and Rivera% in this case% are not ,nlettered em-loyees% their sit,ations diJer in all other res-ects. 3n Talam% the em-loyee received a val,a+le consideration for his less than two years of service with the com-anyD he was not shortchanged and no essential ,nfairness too1 -lace. 3n the case at +ar% as the C& noted% the se-aration -ay the res-ondents each received was deAcient +y at least /@$$%$$$.$$D th,s% they were given only half of the amo,nt they were legally entitled to. To +e s,re% a settlement ,nder these terms is not and cannot +e a reasona+le one% given es-ecially the res-ondentsI length of service (# years for S+arola and " years for Rivera. The C& was correct when it o-ined that the res-ondents were in dire straits when they e7ec,ted the release>8,itclaim a9davits. 2itho,t Co+s and with families to s,--ort% they dallied in e7ec,ting the 8,itclaim instr,ment% +,t were event,ally forced to sign given their circ,mstances. XI. OTHER SPECIAL BENEFITS XII. RIGHT TO SECURITY OF TENURE ST. PAUL COLLEGE, !UE&ON CITY vs. ANCHETA II G.R. No. !""$#% SB/TB5BBR P% ($ )&CTS* /etitioner St. /a,l College% Y,eRon City ;S/CYC< is a -rivate Catholic ed,cational instit,tion. 3t is re-resented +y its /resident% -etitioner Sr. Lilia Therese Tolentino% S/C% the College Dean% Sr. Bernadette Racadio% S/C% and the 5ass Comm,nication /rogram Director% Sr. Sarah 5ana-ol% S/C. The res-ondents% S-o,ses Remigio 5ichael &. &ncheta 33 and Cynthia &. &ncheta are former teachers of the same school. Res-ondent Remigio 5ichael was hired +y the S/CYC as a teacher in the General Bd,cation De-artment with a -ro+ationary ran1 in the School Sear ;SS< ""!0""P which was renewed in the following SS ""P0""'. =is wife% res-ondent Cynthia was hired +y the same school as a -art time teacher of the 5ass Comm,nication De-artment in the second semester of SS ""!0 ""P and her a--ointment was renewed for SS ""P0""'. ?n )e+r,ary :% ""'% res-ondent Remigio 5ichael wrote a letter to -etitioner Sr. Lilia% signifying his intention to renew his contract with S/CYC for SS ""'0""". & letter of the same tenor was also written +y res-ondent Cynthia addressed to -etitioner Sr. Lilia. /etitioner Sr. Bernadette% on 5arch "% ""'% sent two letters with the same contents to the res-ondent s-o,ses informing them that ,-on the " F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch recommendation of the College Co,ncil% the school is e7tending to them new contracts for SS ""'0""". & letter dated &-ril ((% ""' was sent to -etitioner Sr. Bernadette and signed +y some of the teachers of S/CYC% incl,ding the res-ondent s-o,ses. The said letter contained the teachers6 sentiments regarding two school -olicies% namely* Arst% the -olicy of -enaliRing the delay in encoding Anal grades and% second% the -olicy of withholding salaries of the teachers. 5eanwhile% a letter dated &-ril (% ""' ;the date% later on contested +y res-ondent Remigio 5ichael to +e ante0dated< was written +y -etitioner Sr. Bernadette to res-ondent Remigio 5ichael% reiterating the conversation that too1 -lace +etween them the day +efore the date of the said letter ;&-ril ($% ""'<. The letter en,merated the de-artmental and instr,ctional -olicies that res-ondent Remigio 5ichael failed to com-ly with% s,ch as the late s,+mission of Anal grades% fail,re to s,+mit Anal test 8,estions to the /rogram Coordinator% the giving of tests in the essay form instead of the m,lti-le choice format as mandated +y the school and the high n,m+er of st,dents with failing grades in the classes that he handled. Thereafter% -etitioner Sr. Bernadette wrote a letter dated &-ril :$% ""' to -etitioner Sr. Lilia% endorsing the immediate termination of the teaching services of the res-ondent s-o,ses on the following gro,nds* . Non0com-liance with the de-artmental -olicy to s,+mit their Anal test 8,estions to their res-ective -rogram coordinators for chec1ing>comments ;violating -ar. P.% -. !# of the )ac,lty 5an,al<. (. Non0com-liance with the standard format ;m,lti-le choice< of Anal test 8,estions as agreed ,-on in the de-artment. 5r. &ncheta -re-ared -,rely essay 8,estions for the st,dents. :. )ail,re to encode their mod,lar grade re-orts as re8,ired ;violating -ar. =. '% -. !! of o,r )ac,lty man,al<. @. )ail,re to s,+mit and ,-date re8,ired mod,les ;sylla+i< of their s,+Cect des-ite reminders ;violating D% .#% -. @$ of o,r )ac,lty 5an,al<. #. Both s-o,ses have a gross n,m+er of fail,re in their class !. )ail,re to re-ort to wor1 on time Zre* 5r. &ncheta[ ;violating -ar. % (% -. !: of o,r )ac,lty 5an,al<. P. Both s-o,ses are not o-en to s,ggestions to im-rove themselves as teachers. They C,st see their -oints and their -rinci-les. 2hen 3 tal1ed to 5r. &ncheta the second time telling him of the data 3 gathered% incl,ding the information that statistics -ermits only to (Q fail,res% he still ref,sed to +,dge in to review his grades and his 8,ality of teaching. =e stood Arm in his conviction and gro,nd that the st,dents were to +lame for their fail,res% and reiterated his disagreement with several school -olicies ;which he violated< contained in his letter which he had as1ed his wife to give to the dean6s o9ce. Not content on writing down his -ersonal disagreement on some -olicies% he also as1ed some fac,lty mem+ers to read his letter and -,t their signat,res on it if they were in favor of one or all of his -oints. 3n other words% said s-o,ses had ref,sed and contin,e to ref,se to eval,ate the st,dents6 -erformance on the +ases of an esta+lished grading system to ens,re C,st and fair a--raisal ;violating -ar. .@% -. @$ of o,r )ac,lty 5an,al<. Res-ondent s-o,ses were given an o--ort,nity to comment on the a+ove letter0recommendation of -etitioner Sr. Bernadette. ?n 5ay @% ""'% res-ondent s-o,ses sent their res-ective comments to -etitioner Sr. Lilia. S,+se8,ently% the res-ondent s-o,ses received their res-ective letters of termination on 5ay @% ""'. Res-ondent s-o,ses sent a letter for reconsideration to -etitioner Sr. Lilia% +,t was event,ally denied. Th,s% res-ondent s-o,ses Aled a Com-laint for illegal dismissal with the NLRC. 3SSUB* 2hether or not the res-ondent s-o,ses were illegally dismissed. SC RUL3NG* Before this Co,rt delves into the merits of the -etition% it deems it necessary to disc,ss the nat,re of the em-loyment of the res-ondents. 3t is not dis-,ted that res-ondent Remigio 5ichael was a f,ll0time -ro+ationary em-loyee and his wife% a -art0time teacher of the -etitioner school. & reality we have to face in the consideration of em-loyment on -ro+ationary stat,s of teaching -ersonnel is that they are not governed -,rely +y the La+or Code. The La+or Code is s,--lemented with res-ect to the -eriod of -ro+ation +y s-ecial r,les fo,nd in the 5an,al of Reg,lations for /rivate Schools. ?n the matter of -ro+ationary -eriod% Section "( of these reg,lations -rovides* Section "(./ro+ationary /eriod. 0 S,+Cect in all instances to com-liance with the De-artment and school re8,irements% the -ro+ationary -eriod for academic -ersonnel shall not +e more than three ($ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch ;:< consec,tive years of satisfactory service for those in the elementary and secondary levels% si7 ;!< consec,tive reg,lar semesters of satisfactory service for those in the tertiary level% and nine ;"< consec,tive trimesters of satisfactory service for those in the tertiary level where collegiate co,rses are oJered on a trimester +asis. & -ro+ationary em-loyee or -ro+ationer is one who is on trial for an em-loyer% d,ring which the latter determines whether or not he is 8,aliAed for -ermanent em-loyment. The -ro+ationary em-loyment is intended to aJord the em-loyer an o--ort,nity to o+serve the Atness of a -ro+ationary em-loyee while at wor1% and to ascertain whether he will +ecome an e9cient and -rod,ctive em-loyee. 2hile the em-loyer o+serves the Atness% -ro-riety and e9ciency of a -ro+ationer to ascertain whether he is 8,aliAed for -ermanent em-loyment% the -ro+ationer% on the other hand% see1s to -rove to the em-loyer that he has the 8,aliAcations to meet the reasona+le standards for -ermanent em-loyment. Th,s% the word -ro+ationary% as ,sed to descri+e the -eriod of em-loyment% im-lies the -,r-ose of the term or -eriod% not its length. The common -ractice is for the em-loyer and the teacher to enter into a contract% eJective for one school year. &t the end of the school year% the em-loyer has the o-tion not to renew the contract% -artic,larly considering the teacher6s -erformance. 3f the contract is not renewed% the em-loyment relationshi- terminates. 3f the contract is renewed% ,s,ally for another school year% the -ro+ationary em-loyment contin,es. &gain% at the end of that -eriod% the -arties may o-t to renew or not to renew the contract. 3f renewed% this second renewal of the contract for another school year wo,ld then +e the last year since it wo,ld +e the third school year of -ro+ationary em-loyment. &t the end of this third year% the em-loyer may now decide whether to e7tend a -ermanent a--ointment to the em-loyee% -rimarily on the +asis of the em-loyee having met the reasona+le standards of com-etence and e9ciency set +y the em-loyer. )or the entire d,ration of this three0year -eriod% the teacher remains ,nder -ro+ation. U-on the e7-iration of his contract of em-loyment% +eing sim-ly on -ro+ation% he cannot a,tomatically claim sec,rity of ten,re and com-el the em-loyer to renew his em-loyment contract. /etitioner school contends that it did not e7tend the contracts of res-ondent s-o,ses. 3t claims that% altho,gh% it has sent letters to the s-o,ses informing them that the school is e7tending to them new contracts for the coming school year% the letters do not constit,te as act,al em-loyment contracts +,t merely oJers to teach on the said school year. Section " of the 5an,al of Reg,lations for /rivate Schools% states that* Section ".Bm-loyment Contract. Bvery contract of em-loyment shall s-ecify the designation% 8,aliAcation% salary rate% the -eriod and nat,re of service and its date of eJectivity% and s,ch other terms and condition of em-loyment as may +e consistent with laws and r,les% reg,lations and standards of the school. & co-y of the contract shall +e f,rnished the -ersonnel concerned. 3t is im-ortant that the contract of -ro+ationary em-loyment s-ecify the -eriod or term of its eJectivity. The fail,re to sti-,late its -recise d,ration co,ld lead to the inference that the contract is +inding for the f,ll three0 year -ro+ationary -eriod. Therefore% the letters sent +y -etitioner Sr. Racadio% which were void of any s-eciAcs cannot +e considered as contracts. The closest they can resem+le to are that of informal corres-ondence among the said individ,als. &s s,ch% -etitioner school has the right not to renew the contracts of the res-ondents% the old ones having +een e7-ired at the end of their terms. &ss,ming% arg,endo% that the em-loyment contracts +etween the -etitioner school and the res-ondent s-o,ses were renewed% this Co,rt Ands that there was a valid and C,st ca,se for their dismissal. The La+or Code commands that +efore an em-loyer may legally dismiss an em-loyee from the service% the re8,irement of s,+stantial and -roced,ral d,e -rocess m,st +e com-lied with. Under the re8,irement of s,+stantial d,e -rocess% the gro,nds for termination of em-loyment m,st +e +ased on C,st or a,thoriRed ca,ses. /etitioner school charged res-ondent Remigio 5ichael of non0com-liance with a school -olicy regarding the s,+mission of Anal test 8,estions to his -rogram coordinator for chec1ing or comment. The -lain admissions of the charges against them were the considerations ta1en into acco,nt +y the -etitioner school in their decision not to renew the res-ondent s-o,ses6 em-loyment contracts. This is a right of the school that is mandated +y law and C,ris-r,dence. 3t is the -rerogative of the school to set high standards of e9ciency for its teachers since 8,ality ed,cation is a mandate of the Constit,tion. &s long as the standards A7ed are reasona+le and not ar+itrary% co,rts are not at li+erty to set them aside. Schools cannot +e re8,ired to ado-t standards which +arely satisfy criteria set for government recognition. The same academic freedom grants ( F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch the school the a,tonomy to decide for itself the terms and conditions for hiring its teacher% s,+Cect of co,rse to the overarching limitations ,nder the La+or Code. The a,thority to hire is li1ewise covered and -rotected +y its management -rerogative the right of an em-loyer to reg,late all as-ects of em-loyment% s,ch as hiring% the freedom to -rescri+e wor1 assignments% wor1ing methods% -rocess to +e followed% reg,lation regarding transfer of em-loyees% s,-ervision of their wor1% lay0oJ and disci-line% and dismissal and recall of wor1ers. LYNVIL FISHING ENTERPRISES vs. ARIOLA et al. G.R. No. '"P@% )BBRU&RS % ($( )&CTS* The version of the -etitioners follows* . Lynvil )ishing Bnter-rises% 3nc. ;Lynvil< is a com-any engaged in dee-0sea Ashing% o-erating along the shores of /alawan and other o,tlying islands of the /hili--ines. 3t is o-erated and managed +y Rosendo S. de BorCa. (. ?n &,g,st ""'% Lynvil received a re-ort from Romanito Clarido% one of its em-loyees% that on : .,ly ""'% he witnessed that while on +oard the com-any vessel &nalyn 4333% Lynvil em-loyees% namely* &ndres G. &riola ;&riola<% the ca-tainD .essie D. &lcovendas ;&lcovendas<% Chief 5ateD .immy B. Calinao ;Calinao<% Chief BngineerD 3smael G. N,+la ;N,+la<% coo1D Blorde BaVeR ;BaVeR<% oilerD and Leo-oldo D. Se+,llen ;Se+,llen<% +odegero% cons-ired with one another and stole eight ;'< t,+s of E-am-anoE and Etangig,eE Ash and delivered them to another vessel% to the -reC,dice of Lynvil. :. The said em-loyees were engaged on a -er tri- +asis or E-or viaCeE which terminates at the end of each tri-. &riola% &lcovendas and Calinao were managerial Aeld -ersonnel while the rest of the crew were Aeld -ersonnel. @. By reason of the re-ort and after initial investigation% LynvilIs General 5anager Rosendo S. De BorCa ;De BorCa< s,mmoned res-ondents to e7-lain within Ave ;#< days why they sho,ld not +e dismissed from service. =owever% e7ce-t for &lcovendas and BaVeR% the res-ondents ref,sed to sign the recei-t of the notice. #. )ailing to e7-lain as re8,ired% res-ondentsI em-loyment was terminated. !. Lynvil% thro,gh De BorCa% Aled a criminal com-laint against the dismissed em-loyees for violation of /.D. #:(% or the &nti0/iracy and &nti0=ighway Ro++ery Law of "P@ +efore the ?9ce of the City /rosec,tor of 5ala+on City. P. ?n ( Novem+er ""'% )irst &ssistant City /rosec,tor Rosa,ro Silverio fo,nd -ro+a+le ca,se for the indictment of the dismissed em-loyees for the crime of 8,aliAed theft ,nder the Revised /enal Code. ?n the other hand% the story of the defense is* . The -rivate res-ondents were crew mem+ers of LynvilIs vessel named &nalyn 4333. (. ?n : .,ly ""'% they arrived at the Navotas )ish-ort on +oard &nalyn 4333 loaded with %(@ +aVeras of diJerent 1inds of Ashes. These +aVeras were delivered to a consignee named S&S and Royale. The following day% the -rivate res-ondents re-orted +ac1 to Lynvil o9ce to in8,ire a+o,t their new Co+ assignment +,t were told to wait for f,rther advice. They were not allowed to +oard any vessel. :. ?n # &,g,st ""'% only &lcovendas and BaVeR received a memorand,m from De BorCa ordering them to e7-lain the incident that ha--ened on : .,ly ""'. U-on +eing informed a+o,t this% &riola% Calinao% N,+la and Se+,llen went to the Lynvil o9ce. =owever% they were told that their em-loyments were already terminated. &ggrieved% the em-loyees Aled with the &r+itration Branch of the National La+or Relations Commission0National Ca-ital Region on (# &,g,st ""' a com-laint for illegal dismissal with claims for +ac1wages% salary diJerential reinstatement% service incentive leave% holiday -ay and its -remi,m and :th month -ay from ""! to""'. They also claimed for moral% e7em-lary damages and attorneyIs fees for their dismissal with +ad faith. They added that the ,nwarranted acc,sation of theft stemmed from their oral demand of increase of salaries three months earlier and their re8,est that they sho,ld not +e re8,ired to sign a +lan1 -ayroll and vo,chers. 3SSUBS* 2hether or not the em-loyees of Lynvil )ishing Bnter-rise were validly terminated for a C,st ca,se. (( F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch 2hether or not the em-loyees sec,rity of ten,re were violated. 2hether De BorCa is Cointly and severally lia+le with Lynvil. SC RUL3NG* Nonetheless% even witho,t reliance on the -rosec,torIs Anding% we And that there was valid ca,se for res-ondentsI dismissal. 3n illegal dismissal cases% the em-loyer +ears the +,rden of -roving that the termination was for a valid or a,thoriRed ca,se. .,st ca,se is re8,ired for a valid dismissal. The La+or Code -rovides that an em-loyer may terminate an em-loyment +ased on fra,d or willf,l +reach of the tr,st re-osed on the em-loyee. S,ch +reach is considered willf,l if it is done intentionally% 1nowingly% and -,r-osely% witho,t C,stiAa+le e7c,se% as disting,ished from an act done carelessly% tho,ghtlessly% heedlessly or inadvertently. 3t m,st also +e +ased on s,+stantial evidence and not on the em-loyerIs whims or ca-rices or s,s-icions otherwise% the em-loyee wo,ld eternally remain at the mercy of the em-loyer. Loss of conAdence m,st not +e indiscriminately ,sed as a shield +y the em-loyer against a claim that the dismissal of an em-loyee was ar+itrary. &nd% in order to constit,te a C,st ca,se for dismissal% the act com-lained of m,st +e wor10related and shows that the em-loyee concerned is ,nAt to contin,e wor1ing for the em-loyer. 3n addition% loss of conAdence as a C,st ca,se for termination of em-loyment is -remised on the fact that the em-loyee concerned holds a -osition of res-onsi+ility% tr,st and conAdence or that the em-loyee concerned is entr,sted with conAdence with res-ect to delicate matters% s,ch as the handling or care and -rotection of the -ro-erty and assets of the em-loyer. The +etrayal of this tr,st is the essence of the oJense for which an em-loyee is -enaliRed. Breach of tr,st is -resent in this case. 2e agree with the r,ling of the La+or &r+iter and Co,rt of &--eals that the 8,antity of t,+s e7-ected to +e received was the same as that which was loaded. =owever% what is material is the 1ind of Ash loaded and then ,nloaded. Sameness is li1ewise needed. 2e cannot close o,r eyes to the -ositive and clear narration of facts of the three witnesses to the commission of 8,aliAed theft. .onathan DistaCo% a crew mem+er of the &nalyn 4333% stated in his letter addressed to De BorCa dated ' &,g,st ""'% that while the vessel was traversing San Nicolas% Cavite% he saw a small +oat a--roach them. 2hen the +oat was ne7t to their vessel% &lcovendas went inside the stoc1room while Se+,llen -,shed an estimated fo,r t,+s of Ash away from it. &riola% on the other hand% served as the loo1o,t and negotiator of the transaction. )inally% BaVeR and Calinao hel-ed in -,tting the t,+s in the small +oat. =e f,rther added that he received /'$$.$$ as his share for the transaction. Romanito Clarido% who was also on +oard the vessel% corro+orated the narration of DistaCo on all acco,nts in his (# &,g,st ""' a9davit. =e added that &lcovendas told him to 1ee- silent a+o,t what ha--ened on that day. Sealing tight the credi+ility of the narration of theft is the a9davite7ec,ted +y Blorde BaVeR dated : 5ay """. BaVeR was one of the dismissed em-loyees who actively -artici-ated in the ta1ing of the t,+s. =e clariAed in the a9davit that the fo,r t,+s ta1en o,t of the stoc1room in fact contained Ash ta1en from the eight t,+s. =e f,rther stated that &riola told everyone in the vessel not to say anything and instead Ale a la+or case against the management. Clearly% we cannot fa,lt Lynvil and De BorCa when it dismissed the em-loyees. &rt. ('$. Reg,lar and cas,al em-loyment. The -rovisions of written agreement to the contrary notwithstanding and regardless of the oral agreement of the -arties% an em-loyment shall +e deemed to +e reg,lar where the em-loyee has +een engaged to -erform activities which are ,s,ally necessary or desira+le in the ,s,al +,siness or trade of the em-loyer% e7ce-t where the em-loyment has +een A7ed for a s-eciAc -roCect or ,nderta1ing the com-letion or termination of which has +een determined at the time of the engagement of the em-loyee or where the wor1 or service to +e -erformed is seasonal in nat,re and the em-loyment is for the d,ration of the season. &n em-loyment shall +e deemed to +e cas,al if it is not covered +y the -receding -aragra-h* /rovided% That any em-loyee who has rendered at least one year of service% whether s,ch service is contin,o,s or +ro1en% shall +e considered a reg,lar em-loyee with res-ect to the activity in which he is em-loyed and his em-loyment shall contin,e while s,ch activity e7ists. Lynvil contends that it cannot +e g,ilty of illegal dismissal +eca,se the -rivate res-ondents were em-loyed ,nder a A7ed0term contract which e7-ired at the end of the voyage. &ccordingly% and since the entire -,r-ose +ehind the develo-ment of legislation c,lminating in the -resent &rticle ('$ of the La+or Code clearly a--ears to have +een% as already o+served% to -revent circ,mvention of (: F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch the em-loyee6s right to +e sec,re in his ten,re% the cla,se in said article indiscriminately and com-letely r,ling o,t all written or oral agreements conTicting with the conce-t of reg,lar em-loyment as deAned therein sho,ld +e constr,ed to refer to the s,+stantive evil that the Code itself has singled o,t* agreements entered into -recisely to circ,mvent sec,rity of ten,re. 3t sho,ld have no a--lication to instances where a A7ed -eriod of em-loyment was agreed ,-on 1nowingly and vol,ntarily +y the -arties% witho,t any force% d,ress or im-ro-er -ress,re +eing +ro,ght to +ear ,-on the em-loyee and a+sent any other circ,mstances vitiating his consent% or where it satisfactorily a--ears that the em-loyer and em-loyee dealt with each other on more or less e8,al terms with no moral dominance whatever +eing e7ercised +y the former over the latter. Unless th,s limited in its -,rview% the law wo,ld +e made to a--ly to -,r-oses other than those e7-licitly stated +y its framersD it th,s +ecomes -ointless and ar+itrary% ,nC,st in its eJects and a-t to lead to a+s,rd and ,nintended conse8,ences. Contrarily% the -rivate res-ondents contend that they +ecame reg,lar em-loyees +y reason of their contin,o,s hiring and -erformance of tas1s necessary and desira+le in the ,s,al trade and +,siness of Lynvil. .,ris-r,dence% laid two conditions for the validity of a A7ed0contract agreement +etween the em-loyer and em-loyee* )irst% the A7ed -eriod of em-loyment was 1nowingly and vol,ntarily agreed ,-on +y the -arties witho,t any force% d,ress% or im-ro-er -ress,re +eing +ro,ght to +ear ,-on the em-loyee and a+sent any other circ,mstances vitiating his consentD or Second% it satisfactorily a--ears that the em-loyer and the em-loyee dealt with each other on more or less e8,al terms with no moral dominance e7ercised +y the former or the latter. Te7t,ally% the -rovision that* EN& a1o ay s,masang0ayon na magling1od at g,mawa ng mga gawain sang0ayon sa -ata1arang E-or viaCeE na magm,m,la sa -agalis sa Navotas -a-,nta sa -angisdaan at -ag+a+ali1 sa -ondohan ng lantsa sa Navotas% 5etro 5anilaE is for a A7ed -eriod of em-loyment. 3n the conte7t% however% of the facts that* ;< the res-ondents were doing tas1s necessarily to LynvilIs Ashing +,siness with -ositions ranging from ca-tain of the vessel to +odegeroD ;(< after the end of a tri-% they will again +e hired for another tri- with new contractsD and ;:< this arrangement contin,ed for more than ten years% the clear intention is to go aro,nd the sec,rity of ten,re of the res-ondents as reg,lar em-loyees. &nd res-ondents are so +y the e7-ress -rovisions of the second -aragra-h of &rticle ('$% th,s* 777 /rovided% That any em-loyee who has rendered at least one year of service% whether s,ch service is contin,o,s or +ro1en% shall +e considered a reg,lar em-loyee with res-ect to the activity in which he is em-loyed and his em-loyment shall contin,e while s,ch activity e7ists. The same set of circ,mstances indicate clearly eno,gh that it was the need for a contin,ed so,rce of income that forced the em-loyeesI acce-tance of the E-or viaCeE -rovision. =aving fo,nd that res-ondents are reg,lar em-loyees who may +e% however% dismissed for ca,se as we have so fo,nd in this case% there is a need to loo1 into the -roced,ral re8,irement of d,e -rocess in Section (% R,le \\333% Boo1 4 of the R,les 3m-lementing the La+or Code. 3t is re8,ired that the em-loyer f,rnish the em-loyee with two written notices* ;< a written notice served on the em-loyee s-ecifying the gro,nd or gro,nds for termination% and giving to said em-loyee reasona+le o--ort,nity within which to e7-lain his sideD and ;(< a written notice of termination served on the em-loyee indicating that ,-on d,e consideration of all the circ,mstances% gro,nds have +een esta+lished to C,stify his termination. )rom the records% there was only one written notice which re8,ired res-ondents to e7-lain within Ave ;#< days why they sho,ld not +e dismissed from the service. &lcovendas was the only one who signed the recei-t of the notice. The others% as claimed +y Lynvil% ref,sed to sign. The other em-loyees arg,e that no notice was given to them. Des-ite the inconsistencies% what is clear is that no Anal written notice or notices of termination were sent to the em-loyees. The twin re8,irements of notice and hearing constit,te the elements of Md,eN -rocess in cases of em-loyee6s dismissal. The re8,irement of notice is intended to inform the em-loyee concerned of the em-loyer6s intent to dismiss and the reason for the -ro-osed dismissal. U-on the other hand% the re8,irement of hearing aJords the em-loyee an o--ort,nity to answer his em-loyer6s charges against him and accordingly% to defend himselftherefrom +efore dismissal is eJected. ?+vio,sly% the second written notice% as indis-ensa+le as the Arst% is intended to ens,re the o+servance of d,e -rocess. &--lying the r,le to the facts at hand% we grant a monetary award of /#$%$$$.$$ as nominal damages% this% -,rs,ant to the fresh r,ling of this Co,rt in C,lili v. Bastern Comm,nication /hili--ines% 3nc. D,e to the fail,re (@ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch of Lynvil to follow the -roced,ral re8,irement of two0notice r,le% nominal damages are d,e to res-ondents des-ite their dismissal for C,st ca,se. Given the fact that their dismissal was for C,st ca,se% we cannot grant +ac1wages and se-aration -ay to res-ondents. =owever% following the Andings of the La+or &r+iter who with the e7-ertise -resided over the -roceedings +elow% which Andings were a9rmed +y the Co,rt of &--eals% we grant the :th month -ay and salary diJerential of the dismissed em-loyees. Whether "e #or$a is $ointly and se%erally liale with Lyn%il &s to the last iss,e% this Co,rt has r,led that in la+or cases% the cor-orate directors and o9cers are solidarily lia+le with the cor-oration for the termination of em-loyment of em-loyees done with malice or in +ad faith. 3ndeed% moral damages are recovera+le when the dismissal of an em-loyee is attended +y +ad faith or fra,d or constit,tes an act o--ressive to la+or% or is done in a manner contrary to good morals% good c,stoms or -,+lic -olicy. 3t has also +een disc,ssed in &A& Realty "e%elopment 'orporation %! (LR' that* 7 7 7 & cor-oration +eing a C,ridical entity% may act only thro,gh its directors% o9cers and em-loyees. ?+ligations inc,rred +y them% acting as s,ch cor-orate agents% are not theirs +,t the direct acco,nta+ilities of the cor-oration they re-resent. Tr,e% solidary lia+ilities may at times +e inc,rred +,t only when e7ce-tional circ,mstances warrant s,ch as% generally% in the following cases* . 2hen directors and tr,stees or% in a--ro-riate cases% the o9cers of a cor-oration* 777 ;+< act in +ad faith or with gross negligence in directing the cor-orate aJairsD 7 7 7 The term E+ad faithE contem-lates a Estate of mind a9rmatively o-erating with f,rtive design or with some motive of self0interest or will or for ,lterior -,r-ose.E 2e agree with the r,ling of +oth the NLRC and the Co,rt of &--eals when they -rono,nced that there was no evidence on record that indicates commission of +ad faith on the -art of De BorCa. =e is the general manager of Lynvil% the one tas1ed with the s,-ervision +y the em-loyees and the o-eration of the +,siness. =owever% there is no -roof that he im-osed on the res-ondents the E-or viaCeE -rovision for -,r-ose of eJecting their s,mmary dismissal. D.M. CONSUNI INC. vs. AMIN G.R. No. "(#@% &/R3L '% ($( )&CTS* Res-ondents &ntonio Go+res% 5agellan Dalisay% Godofredo /aragsa% Bmilio &leta and Generoso 5elo wor1ed as car-enters in the constr,ction -roCects of -etitioner D.5. Cons,nCi% 3nc.% a constr,ction com-any% on several occasions and>or at vario,s times. Their termination from em-loyment for each -roCect was re-orted to the De-artment of La+or and Bm-loyment ;D?LB<% in accordance with /olicy 3nstr,ction No. ($% which was later s,-erseded +y De-artment ?rder No. "% series of "":. Res-ondentsI last assignment was at Y,ad @0/roCect in Glorietta% &yala% 5a1ati% where they started wor1ing on Se-tem+er % ""'. ?n ?cto+er @% ""'% res-ondents saw their names incl,ded in the Notice of Termination -osted on the +,lletin +oard at the -roCect -remises. Res-ondents Aled a Com-laint with the &r+itration Branch of the National La+or Relations Commission ;NLRC< against -etitioner D.5. Cons,nCi% 3nc. and David 5. Cons,nCi for illegal dismissal% and non0-ayment of :th month -ay% Ave ;#< days service incentive leave -ay% damages and attorneyIs fees. /etitioner D.5. Cons,nCi% 3nc. and David 5. Cons,nCi co,ntered that res-ondents% +eing -roCect em-loyees% are covered +y /olicy 3nstr,ction No. ($% as s,-erseded +y De-artment ?rder No. "% series of "": with res-ect to their se-aration or dismissal. Res-ondents were em-loyed -er -roCect ,nderta1en +y -etitioner com-any and within varying estimated -eriods indicated in their res-ective -roCect em-loyment contracts. Citing the em-loyment record of each res-ondent% -etitioner and David 5. Cons,Ci averred that res-ondentsI services were terminated when their -hases of wor1 for which their services were engaged were com-leted or when the -roCects themselves were com-leted. /etitioner contended that since res-ondents were terminated +y reason of the com-letion of their res-ective -hases of wor1 in the constr,ction -roCect% their termination was warranted and legal. (# F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch Res-ondents re-lied that the Y,ad @0/roCect at Glorietta% &yala% 5a1ati City was estimated to ta1e two years to Anish% +,t they were dismissed within the two0year -eriod. They had no -rior notice of their termination. =ence% granting that they were -roCect em-loyees% they were still illegally dismissed for non0o+servance of -roced,ral d,e -rocess. ?n ?cto+er @% """% the La+or &r+iter rendered a decision dismissing res-ondentsI com-laint. The La+or &r+iter fo,nd that res-ondents were -roCect em-loyees% that they were dismissed from the last -roCect they were assigned to when their res-ective -hases of wor1 were com-leted% and that -etitioner D.5. Cons,nCi% 3nc. and David 5. Cons,nCi re-orted their termination of services to the D?LB in accordance with the re8,irements of law. The -etition is meritorio,s. Res-ondents were fo,nd to +e -roCect em-loyees +y the La+or &r+iter% the NLRC and the Co,rt of &--eals. Their ,nanimo,s Anding that res-ondents are -roCect em-loyees is +inding on the Co,rt. 3t m,st also +e -ointed o,t that res-ondents have not a--ealed from s,ch Anding +y the Co,rt of &--eals. 3t is only the -etitioner that a--ealed from the decision of the Co,rt of &--eals. 3SSUB* The main iss,e is whether or not res-ondents% as -roCect em-loyees% are entitled to nominal damages for lac1 of advance notice of their dismissal. SC RUL3NG* /rior or advance notice of termination is not -art of -roced,ral d,e -rocess if the termination of a -roCect em-loyee is +ro,ght a+o,t +y the com-letion of the contract or -hase thereof. This is +eca,se com-letion of the wor1 or -roCect a,tomatically terminates the em-loyment% in which case% the em-loyer is% ,nder the law% only o+liged to render a re-ort to the D?LB. Therefore% failing to give -roCect em-loyees advance notice of their termination is not a violation of -roced,ral d,e -rocess and cannot +e the +asis for the -ayment of nominal damages. XIII. MANAGEMENT PREROGATIVE ALERT SECURITY AND INVESTIGATION AGENCY vs. PASAWILAN G.R. No. '(:"P% SB/TB5BBR @% ($ )&CTS* Res-ondents Saidali /asawilan% 2ilfredo 4erceles and 5elchor B,l,san were all reg,lar em-loyees of &lert Sec,rity and 3nvestigation &gency% 3nc. ;&lert Sec,rity<. They were -aid !#.$$ -esos a day as sec,rity g,ards and assigned at the De-artment of Science and Technology ;D?ST<. Beca,se they were ,nder-aid% res-ondents Aled a com-laint for money claims against &lert Sec,rity +efore the La+or &r+iter. &s a res,lt of their com-laint% they were relieved from their -osts in the D?ST and were not given new assignments des-ite the la-se of si7 months. They Aled a Coint com-laint for illegal dismissal against &lert Sec,rity. The com-laint for money claims was dismissed for lac1 of merit +,t &lert Sec,rity was ordered to -ay /asawilan et al their latest salary diJerentials. ?n the other hand% the La+or &r+iter handling the illegal dismissal case r,led that /asawilan et al have +een illegally dismissed and each com-lainant sho,ld +e -aid individ,al awards. &lert Sec,rity a--ealed the decision to the NLRC claiming that com-lainants were not illegally dismissed +,t were only transferred. They claimed that it was the res-ondents who ref,sed to re-ort for wor1 in their new assignment. ?n .an,ary :% ($$P% the NLRC dismissed the com-laint for illegal dismissal after r,ling that the fact of dismissal or termination of em-loyment was not s,9ciently esta+lished. /asawilan et al Aled a -etition for certiorari with the C&. The C& r,led that &lert Sec,rity% as an em-loyer% failed to discharge its +,rden to show that the em-loyee6s se-aration from em-loyment was not motivated +y discrimination% made in +ad faith% or eJected as a form of -,nishment or demotion witho,t s,9cient ca,se. The C& also fo,nd that res-ondents were never informed of the ED,ty Detail ?rdersE transferring them to a new -ost% there+y ma1ing the alleged transfer ineJective. &lert Sec,rity Aled a -etition for review on certiorari to SC. 3SSUB* 2hether or not /asawilan et al were illegally dismissed. SC RUL3NG* /asawilan et al were illegally dismissed. &s a r,le% em-loyment cannot +e terminated +y an em-loyer witho,t any C,st or a,thoriRed ca,se. No less than the"'P Constit,tion in Section :% &rticle : g,arantees sec,rity of ten,re for wor1ers and +eca,se of this% an em-loyee may only +e terminated for C,st or a,thoriRed ca,ses that m,st com-ly with the d,e -rocess re8,irements mandated +y law. (! F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch 3n De G,Rman% .r. v. Commission on Blections% the Co,rt% s-ea1ing of the Constit,tional g,arantee of sec,rity of ten,re to all wor1ers% r,led* . . 3t only means that an em-loyee cannot +e dismissed ;or transferred< from the service for ca,ses other than those -rovided +y law and after d,e -rocess is accorded the em-loyee. 2hat it see1s to -revent is ca-ricio,s e7ercise of the -ower to dismiss. . . There m,st +e a valid and lawf,l reason for terminating the em-loyment of a wor1er. ?therwise% it is illegal and wo,ld +e dealt with +y the co,rts accordingly. &s stated in Bascon v. Co,rt of &--eals* . . . The em-loyer6s -ower to dismiss m,st +e tem-ered with the em-loyee6s right to sec,rity of ten,re. Time and again we have said that the -reservation of the life+lood of the toiling la+orer comes +efore concern for +,siness -roAts. Bm-loyers m,st +e reminded to e7ercise the -ower to dismiss with great ca,tion% for the State will not hesitate to come to the s,ccor of wor1ers wrongly dismissed +y ca-ricio,s em-loyers. 3n the case at +ar% res-ondents were relieved from their -osts +eca,se they Aled with the La+or &r+iter a com-laint against their em-loyer for money claims d,e to ,nder-ayment of wages. This reason is ,nacce-ta+le and illegal. The La+or Code% as amended% en,merates several C,st and a,thoriRed ca,ses for a valid termination of em-loyment. &n em-loyee asserting his right and as1ing for minim,m wage is not among those ca,ses. Dismissing an em-loyee on this gro,nd amo,nts to retaliation +y management for an em-loyee6s legitimate grievance witho,t d,e -rocess. MANILA PAVILION HOTEL vs. DELADA G.R. No. '""@P% .&NU&RS (#% ($( )&CTS* Delada was the Union /resident of the 5anila /avilion S,-ervisors &ssociation at 5/=. =e was originally assigned as =ead 2aiter of Rotisserie% a Ane0dining resta,rant o-erated +y -etitioner. /,rs,ant to a s,-ervisory -ersonnel reorganiRation -rogram% 5/= reassigned him as =ead 2aiter of Seasons CoJee Sho- at the same hotel. Res-ondent declined the inter0o,tlet transfer. The grievance machinery ,nder their CB& was initiated. Delada -ersistently re+,Jed orders for him to re-ort to his new assignment for the time +eing witho,t -reC,dice to the resol,tion of the grievance involving the transfer. &ccording to him% since the grievance machinery ,nder their CB& had already +een initiated% his transfer m,st +e held in a+eyance. 5/= initiated administrative -roceedings against him for his ref,sal to re-ort to his new -ost at Seasons CoJee Sho- and -laced Delada on a :$0 day -reventive s,s-ension. =e attended the hearings together with ,nion re-resentatives. The -arties failed to reach a settlement in the grievance meetings% /eers Reso,rces Develo-ment Director level and the Grievance Committee level. Delada lodged a Com-laint +efore the National Conciliation and 5ediation Board. The iss,es s,+mitted +y the -arties for vol,ntary ar+itration incl,ded ;<2hether or not the transfer of the ,nion -resident from head waiter at Rotisserie to head waiter at seasons resta,rant is valid and C,stiAedD and ;(<. 2hether or not the -reventive s,s-ension of the com-lainant is valid and C,stiAedD 5/= contin,ed with the disci-linary action against him 5/= fo,nd him g,ilty of ins,+ordination +ased on his re-eated and willf,l diso+edience of the transfer order and im-osed on Delada the -enalty of "$0day s,s-ension. =e o--osed the Decision% arg,ing that 5/= had lost its a,thority to -roceed with the disci-linary action against him% since the matter had already +een incl,ded in the vol,ntary ar+itration. the ;/anel of vol,ntary &r+itrators</4& r,led* The transfer of Delada was a valid e7ercise of management -rerogative and he had no valid and C,stiAa+le reason to ref,se or even to delay com-liance with the management6s directive. The transfer order was done in the interest of the e9cient and economic o-erations of 5/=% and that there was no malice% +ad faith% or im-ro-er motive attendant ,-on the transfer of Delada to Seasons CoJee Sho-. The real reason why he ref,sed to o+ey the transfer order was that he as1ed for additional monetary +eneAts as a condition for his transfer. ),rthermore% the -anel r,led that his transfer from Rotisserie to Seasons CoJee Sho- did not -reC,dice or inconvenience him. Neither did it res,lt in dimin,tion of salaries or demotion in ran1. (P F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch There was no legal and fact,al +asis to s,--ort -etitioner6s im-osition of -reventive s,s-ension on Delada. The mere assertion of 5/= that Eit is not far0fetched for =enry Delada to sa+otage the food to +e -re-ared and served to the res-ondent6s dining g,est and em-loyees +eca,se of the hostile relationshi- then e7istingE was more imagined than real. &lso% the 5/= went +eyond the :$0day -eriod of -reventive s,s-ension -rescri+ed +y the 3m-lementing R,les of the La+or Code when -etitioner -roceeded to im-ose a se-arate -enalty of "$0day s,s-ension on him. ),rthermore% 5/= lost its a,thority to contin,e with the administrative -roceedings since the /4& ac8,ired e7cl,sive C,risdiction when the -arties s,+mitted iss,es +efore it. The -anel reasoned that the Coint s,+mission to it of the iss,e on the validity of the transfer order encom-assed% +y necessary im-lication% the iss,e of res-ondent6s ins,+ordination and willf,l diso+edience of the transfer order. Since the :$0day -reventive s,s-ension and the -enalty of "$0day s,s-ension was invalid% then 5/= was lia+le to -ay +ac1 wages and other +eneAts. The C& a9rmed the Decision of the /4& and denied -etitioner6s 5otion for Reconsideration. Conse8,ently% 5/= Aled the instant /etition. 3SSUBS* 2hether 5/= retained the a,thority to contin,e with the administrative case against Delada for ins,+ordination and willf,l diso+edience of the transfer order. 2hether 5/= is lia+le to -ay +ac1 wages. SC RUL3NG* Co,ld the /4& herein view that the iss,e -resented +efore it ] the 8,estion of the validity of the transfer order ] necessarily incl,ded the 8,estion of res-ondent Delada6s ins,+ordination and willf,l diso+edience of the transfer orderL /,rs,ant to the doctrines in Sime Dar+y /ili-inas and L,do U L,ym Cor-oration% the /4& was a,thoriRed to ass,me C,risdiction over the related iss,e of ins,+ordination and willf,l diso+edience of the transfer order. 3n those cases% however% the vol,ntary ar+itrators did in fact ass,me C,risdiction over the related iss,es and made r,lings on the matter. 3n the -resent case% the /4& did not ma1e a r,ling on the s-eciAc iss,e of ins,+ordination and willf,l diso+edience of the transfer order. The /4& merely said that its disagreement with the "$0day -enalty of s,s-ension stemmed from the fact that the -enalty went +eyond the :$0day limit for -reventive s,s-ension* )irst% it m,st +e -ointed o,t that the +asis of the :$0 day -reventive s,s-ension im-osed on Delada was diJerent from that of the "$0day -enalty of s,s-ension. /reventive s,s-ension is a disci-linary meas,re resorted to +y the em-loyer -ending investigation of an alleged malfeasance or misfeasance committed +y an em-loyee. The em-loyer tem-orarily +ars the em-loyee from wor1ing if his contin,ed em-loyment -oses a serio,s and imminent threat to the life or -ro-erty of the em-loyer or of his co0wor1ers. ?n the other hand% the -enalty of s,s-ension refers to the disci-linary action im-osed on the em-loyee after an o9cial investigation or administrative hearing is cond,cted. The em-loyer e7ercises its right to disci-line erring em-loyees -,rs,ant to com-any r,les and reg,lations. Th,s% a Anding of validity of the -enalty of "$0day s,s-ension will not em+race the iss,e of the validity of the :$0 day -reventive s,s-ension. The /4& herein did not ma1e a deAnitive r,ling on the merits of the validity of the "$0day s,s-ension. The -anel only held that 5/= lost its C,risdiction to im-ose disci-linary action on res-ondent. &ccordingly% we r,le in this case that 5/= did not lose its a,thority to disci-line res-ondent for his contin,ed ref,sal to re-ort to his new assignment. 3n relation to this -oint% we recall o,r Decision in &llied Ban1ing Cor-oration v. Co,rt of &--eals. The ref,sal to o+ey a valid transfer order constit,tes willf,l diso+edience of a lawf,l order of an em-loyer. Bm-loyees may o+Cect to% negotiate and see1 redress against em-loyers for r,les or orders that they regard as ,nC,st or illegal. =owever% ,ntil and ,nless these r,les or orders are declared illegal or im-ro-er +y com-etent a,thority% the em-loyees ignore or diso+ey them at their -eril. )or Galanida6s contin,ed ref,sal to o+ey &llied Ban16s transfer orders% we hold that the +an1 dismissed Galanida for C,st ca,se in accordance with &rticle ('(;a< of the La+or Code. Galanida is th,s not entitled to reinstatement or to se-aration -ay. ;Bm-hasis s,--lied% citations omitted<. /,rs,ant to &llied Ban1ing% ,nless the order of 5/= is rendered invalid% there is a -res,m-tion of the validity of that order. Since the /4& event,ally r,led that the transfer order was a valid e7ercise of management -rerogative% 5/= had the a,thority to contin,e with the administrative -roceedings for ins,+ordination and willf,l diso+edience (' F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch against Delada and to im-ose on him the -enalty of s,s-ension. &s a conse8,ence% -etitioner is not lia+le to -ay +ac1 wages and other +eneAts for the -eriod corres-onding to the -enalty of "$0day s,s-ension. 2e r,le that -etitioner 5anila /avilion =otel had the a,thority to contin,e with the administrative -roceedings for ins,+ordination and willf,l diso+edience against Delada and to im-ose on him the -enalty of s,s-ension. Conse8,ently% -etitioner is not lia+le to -ay +ac1 wages and other +eneAts for the -eriod corres-onding to the -enalty of "$0day s,s-ension. XIV. TERMINATION OF EMPLOYMENT LOPE& vs. ALTURAS GROUP OF COMPANIES G.R. No. "$$'% &/R3L % ($ )&CTS* /etitioner Y,irico Lo-eR was hired as a tr,c1 driver +y <,ras Gro,- of Com-anies. Sometime in ""P% he was dismissed after he was allegedly ca,ght +y res-ondent6s sec,rity g,ard in the act of attem-ting to sm,ggle o,t of the com-any -remises !$ 1ilos of scra- iron worth /'@$. 3n com-liance with the Show Ca,se ?rder% -etitioner answered the allegations +y a handwritten e7-lanation. )inding -etitioner6s e7-lanation ,nsatisfactory% res-ondent com-any terminated his em-loyment +y Notice of Termination% on the gro,nds of loss of tr,st and conAdence% and of violation of com-any r,les and reg,lations. /etitioner there,-on Aled a com-laint against res-ondent com-any for illegal dismissal and ,nder-ayment of wages. =e claimed that the sm,ggling charge against him was fa+ricated to C,stify his illegal dismissalD that the Aling of the charge came a+o,t after he re-orted the loss of the original co-y of his -ay sli-% which re-ort% he went on to claim% res-ondent com-any too1 to mean that he co,ld ,se the -ay sli- as evidence for Aling a com-laint for violation of la+or laws. By decision of the La+or &r+iter% it was held that -etitioner6s dismissal was C,stiAed% for he% a tr,c1 driver% held a -osition of tr,st and conAdence% and his act of stealing com-any -ro-erty was a violation of the tr,st re-osed ,-on him. ?n a--eal% the National La+or Relations Commission6s ;NLRC<% reversed the r,ling of the La+or &r+iter ,-on Anding that res-ondent6s evidence did not s,9ce to warrant the termination of -etitioner6s services. 2hen the res-ondent a--ealed the case to the Co,rt of &--eals% it reversed the NLRC r,ling and held that res-ondent com-any was C,stiAed in terminating -etitioner6s em-loyment on the gro,nd of loss of tr,st and conAdence% his alleged act of sm,ggling o,t the scra- iron having +een s,9ciently esta+lished thro,gh the a9davits of s,-erior em-loyees. &l+eit the a--ellate co,rt fo,nd that -etitioner6s dismissal was for a C,st ca,se% it held that d,e -rocess was not o+served when res-ondent com-any failed to give him a chance to defend his side in a -ro-er hearing. 3SSUBS* 2?N the termination was for a C,st ca,se. 2?N the -etitioner was aJorded d,e -rocess. SC RUL3NG* The termination was for a C,st ca,se. Dismissals have two facets* the legality of the act of dismissal% which constit,tes s,+stantive d,e -rocess% and the legality of the manner of dismissal which constit,tes -roced,ral d,e -rocess. &s to s,+stantive d,e -rocess% the Co,rt Ands that res-ondent com-any6s loss of tr,st and conAdence arising from -etitioner6s sm,ggling o,t of the scra- iron% com-o,nded +y his -ast acts of ,na,thoriRed selling cartons +elonging to res-ondent com-any% constit,ted C,st ca,se for terminating his services. /etitioner% a driver assigned with a s-eciAc vehicle% was entr,sted with the trans-ortation of res-ondent com-any6s goods and -ro-erty% and conse8,ently with its handling and -rotection% hence% even if he did not occ,-y a managerial -osition% he can +e said to +e holding a -osition of res-onsi+ility. &s to his act ] -rinci-al gro,nd for his dismissal ] his attem-t to sm,ggle o,t the scra- iron +elonging to res-ondent com-any% the same is ,ndo,+tedly wor10related. The /etitioner was given d,e -rocess. /roced,ral d,e -rocess has +een deAned as giving an o--ort,nity to +e heard +efore C,dgment is rendered. /etitioner was given the o--ort,nity to e7-lain his side when he was informed of the charge against him and re8,ired to s,+mit his written e7-lanation with which he com-lied. There is no violation of d,e -rocess even if no hearing was cond,cted% where the -arty was given a chance to e7-lain his side of the controversy. The right to co,nsel and the assistance of one in investigations involving termination (" F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch cases is neither indis-ensa+le nor mandatory% e7ce-t when the em-loyee himself re8,ests for one or that he manifests that he wants a formal hearing on the charges against him. 3n -etitioner6s case% there is no showing that he re8,ested for a formal hearing to +e cond,cted or that he +e assisted +y co,nsel. =ence% the -etition was denied. APACIBLE vs. MULTIMED INDUSTRIES INC. G.R. No. P'"$:% 5&S :$% ($ )&CTS* /etitioner .,liet &-aci+le was the com-anyIs &ssistant &rea Sales 5anager for Ce+, ?-erations when she was se-arated from service. ?n ($$:% /etitioner was informed that she will +e transferred to the com-any6s main o9ce in /asig City on acco,nt of the ongoing reorganiRation. &t the same time% she was -laced ,nder investigation for the delayed released of BCRs ;cash +,dget for c,stomer re-resentation in sealed envelo-es which are given to loyal clients<. 3n her written e7-lanation% -etitioner% admitting that the delay constit,ted a violation of com-any -olicies% averred that she forgot to endorse the BCRs +eca,se she was thin1ing a+o,t her im-ending transferD and that she did not misa--ro-riate the money as she had already released the BCRs. )inding that the delay in releasing the BCRs amo,nted to loss of tr,st and conAdence% -etitioner was given the o-tion to resign. She there,-on re-orted to the head o9ce in /asig City. 3n the meeting there% she was given the o-tions of resignation% termination% availment of an early retirement -ac1age% or transfer to /asig City. 2itho,t availing of any o-tion% -etitioner too1 a leave of a+sence. /etitioner% thro,gh co,nsel% inform the com-any that the meeting that too1 -lace was Eillegal%E Einsensitive%E Einh,maneE and -etitioner6s dismissals a E,nilateral arrangement and r,thless dis-lay of -ower.E 3n the same letter% her co,nsel demanded -ayment of se-aration -ay and stated that he had advised -etitioner to remain in her c,rrent -osition in Ce+,. The res-ondent com-any then sent -etitioner a memorand,m0directivefor her to immediately re-ort to the head o9ce in /asig City and to ret,rn the com-any vehicle assigned to her to the Ce+, ?9ce within (@ ho,rs. /etitioner did not heed the directive% however. She instead Aled an a--lication for sic1 leave. By 5emorand,m% res-ondent reiterated its directive to -etitioner% +,t her co,nsel sent another letter to the com-any% fa,lting her for -ress,ring -etitioner to resign and reiterating the demand for se-aration -ay. &gain co,nsel stated that he had advised -etitioner to remain in Ce+,. /etitioner then re8,ested that she +e given her daily wor1 assignment in Ce+,% which re8,est was denied +y the res-ondent. Later on% -etitioner was given a show ca,se notice for her to e7-lain in writing why she sho,ld not +e sanctioned for ins,+ordination for fail,re to com-ly with the transfer order. &gain% -etitioner% thro,gh co,nsel% wrote res-ondent com-any% maintaining that she was Enot transferring to 5anilaE and that if the com-any EwantMedN -etitioner o,t of the com-any%E se-aration -ay m,st +e -aid. By letter to the -etitionerIs co,nsel% res-ondent com-any denied having -ress,red -etitioner as it stressed that the transfer was +ased on +,siness demands and did not entail a demotion in ran1 nor dimin,tion of +eneAts. Res-ondent com-any then sent -etitioner a notice of termination for ins,+ordination% -rom-ting -etitioner to Ale a com-laintfor illegal dismissal% non0-ayment of overtime -ay% :th month -ay% service incentive leave -ay% se-aration -ay% damages and attorney6s fees +efore the La+or &r+iter. The La+or &r+iter dismissed -etitioner6s com-laint% r,ling that she was dismissed for C,st ca,se% i.e.% fra,d or loss or tr,st and conAdence ,nder &rticle ('( ;a< and ;c< of the La+or Code. ?n a--eal% the National La+or Relations Commission ;NLRC<% a9rmed the La+or &r+iter6s decision +,t on a diJerent gro,nd ] -etitioner6s ref,sal to o+ey the transfer orders which amo,nted to ins,+ordination. The NLRC% however% granted -etitioner se-aration -ay +y way of Anancial assistance% :th month -ay% and an amo,nt re-resenting salary for Ave ,n-aid days. The Co,rt of &--eals granted res-ondent com-any6s a--eal +y modifying the NLRC Decision. 3t r,led that -etitioner was not entitled to se-aration -ay +eca,se% contrary to the NLRC6s Anding% she Elac1ed good faith.E 3t noted that -etitioner% from the start% 1new and acce-ted the com-any -olicy on transfers whenever so re8,ired% and co,ld not th,s ref,se Eanother valid reassignment +y treating it as an im-osition and +,rden.E The a--ellate co,rt f,rther held that as an &ssistant &rea Sales 5anager% -etitioner was e7-ected to Eshow more e7acting wor1 ethics% a higher degree of loyalty and res-ect as o--osed to her s,+ordinate em-loyees%E :$ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch yet she Eo-enly and contin,ally deAedE the transfer ordersD and that her +elligerent attit,de +ecame even more -rono,nced when her co,nsel sent several ins,lting and threatening letters to res-ondent com-any and its o9cers. The a--ellate co,rt went on to And that -etitioner6s acts were Ehighly insolent% im-ertinent and lac1ing in good faith%E hence% not entitled to se-aration -ay +y way of Anancial assistance. 3SSUB* 2?N -etitioner is entitled se-aration -ay +y way of Anancial assistance. SC RUL3NG* The -etition fails. &s fo,nd +y the La+or &r+iter% the NLRC and the a--ellate co,rt% -etitioner was C,stly dismissed from em-loyment. The law is clear. Se-aration -ay is only warranted when the ca,se for termination is not attri+,ta+le to the em-loyee6s fa,lt s,ch as those -rovided in &rticles (': and ('@ of the La+or Code% as well as in cases of illegal dismissal in which reinstatement is no longer feasi+le. 3t is not allowed when an em-loyee is dismissed for C,st ca,se% s,ch as serio,s miscond,ct. 3n clear and ,nmista1a+le lang,age% it has +een held that the award of Anancial assistance shall not +e given to validly terminated em-loyees% whose oJenses are ini8,ito,s or reTective of some de-ravity in their moral character. 2hen the em-loyee commits an act of dishonesty% de-ravity% or ini8,ity% the grant of Anancial assistance is mis-laced com-assion. /etitioner was% it +ears reiteration% dismissed for willf,lly diso+eying the lawf,l order of her em-loyer to transfer from Ce+, to /asig City. &s correctly noted +y the a--ellate co,rt% -etitioner 1new and acce-ted res-ondent com-any6s -olicy on transfers when she was hired and was in fact even transferred many times from one area of o-erations to another ] Bacolod City% 3loilo City and Ce+,. The act of the /etitioner constit,tes serio,s miscond,ct or willf,l diso+edience. 2illf,l diso+edience of the em-loyer6s lawf,l orders% as a C,st ca,se for dismissal of an em-loyee% envisages the conc,rrence of at least two re8,isites* ;< the em-loyee6s assailed cond,ct m,st have +een willf,l% that is% characteriRed +y a wrongf,l and -erverse attit,deD and ;(< the order violated m,st have +een reasona+le% lawf,l% made 1nown to the em-loyee and m,st -ertain to the d,ties which he had +een engaged to discharge. Clearly% -etitioner6s adamant ref,sal to transfer% co,-led with her fail,re to heed the order for her ret,rn the com-any vehicle assigned to her and% more im-ortantly% allowing her co,nsel to write letters co,ched in harsh lang,age to her s,-eriors ,n8,estiona+ly show that she was g,ilty of ins,+ordination% hence% not entitled to the award of se-aration -ay. BARROGA vs. DATA CENTER COLLEGE OF THE PHILIPPINES G.R. No. P@#'% .UNB (P% ($ )&CTS* /etitioner was em-loyed as an 3nstr,ctor in Data Center College Laoag City +ranch in 3locos Norte. & 5emorand,m was iss,ed +y the res-ondent which transferred him to University of Northern /hili--ines ;UN/< in 4igan% 3locos S,r where the school had a tie0,- -rogram. /etitioner was informed that he wo,ld +e receiving% in addition to his monthly salary% an allowance for +oard and lodging d,ring his stint as instr,ctor in UN/04igan. =e was recalled to Laoag cam-,s afterwards. &gain% -etitioner received a 5emorand,mtransferring him to Data Center College Bang,ed% &+ra +ranch as =ead for Bd,cation>3nstr,ctor d,e to an ,rgent need for an e7-erienced o9cer and com-,ter instr,ctor thereat. =owever% -etitioner declined to acce-t his transfer to &+ra citing among others% the a+sence of additional rem,neration to defray e7-enses for +oard and lodging which constit,tes im-licit dimin,tion of his salary. /etitioner Aled a Com-laint for constr,ctive dismissal against res-ondents. /etitioner alleged that his -ro-osed transfer to &+ra constit,tes a demotion in ran1 and dimin,tion in -ay and wo,ld ca,se -ersonal inconvenience and hardshi-. )or their -art% res-ondents claimed that they were merely e7ercising their management -rerogative to transfer em-loyees for the -,r-ose of advancing the school6s interests. They arg,ed that -etitioner6s ref,sal to +e transferred to &+ra constit,tes ins,+ordination. They claimed that -etitioner6s a--ointment as instr,ctor carries a -roviso of -ossi+le re0 assignments to any +ranch or tie0,- schools as the school6s necessity demands. =ead for Bd,cation in Laoag +ranch was merely tem-orary and : F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch that he wo,ld still occ,-y his original -lantilla item as instr,ctor at his -ro-osed assignment in &+ra +ranch. The La+or &r+iter rendered a Decision dismissing the Com-laint for lac1 of merit. The La+or &r+iter r,led that there was no demotion in ran1 as -etitioner6s original a--ointment as instr,ctor conferred ,-on res-ondents the right to transfer him to any of the school6s +ranches and that -etitioner6s designation as =ead for Bd,cation can +e withdrawn anytime since he held s,ch administrative -osition in a non0-ermanent ca-acity. The NLRC a9rmed the Andings of the La+or &r+iter that there was no constr,ctive dismissal. 3t r,led that the management decision to transfer -etitioner was well within the rights of res-ondents in consonance with -etitioner6s contract of em-loyment and which was not s,9ciently shown to have +een e7ercised ar+itrarily +y res-ondents. The C& dismissed the -etition +eca,se of the non0com-liance of certain -roced,ral re8,irements. 3SSUB* 2?N the transfer of the -etitioner was tantamo,nt to constr,ctive dismissal. SC RUL3NG* /etitioner6s transfer was not tantamo,nt to constr,ctive dismissal. Constr,ctive dismissal is 8,itting +eca,se contin,ed em-loyment is rendered im-ossi+le% ,nreasona+le or ,nli1ely% or +eca,se of a demotion in ran1 or a dimin,tion of -ay. 3t e7ists when there is a clear act of discrimination% insensi+ility or disdain +y an em-loyer which +ecomes ,n+eara+le for the em-loyee to contin,e his em-loyment. /etitioner was originally a--ointed as instr,ctor and was given additional administrative f,nctions as =ead for Bd,cation d,ring his stint in Laoag +ranch. =e did not deny having +een designated as =ead for Bd,cation in a tem-orary ca-acity for which he cannot invo1e any ten,rial sec,rity. =ence% +eing tem-orary in character% s,ch designation is termina+le at the -leas,re of res-ondents who made s,ch a--ointment. 3t is management -rerogative for em-loyers to transfer em-loyees on C,st and valid gro,nds s,ch as gen,ine +,siness necessity. The Co,rt agrees with the La+or &r+iter that there was no violation of the -rohi+ition on dimin,tion of +eneAts. 3ndeed% any +eneAt and -er1s +eing enCoyed +y em-loyees cannot +e red,ced and discontin,edD otherwise% the constit,tional mandate to aJord f,ll -rotection to la+or shall +e oJended.B,t the r,le against dimin,tion of +eneAts is a--lica+le only if the grant or +eneAt is fo,nded on an e7-ress -olicy or has ri-ened into a -ractice over a long -eriod which is consistent and deli+erate. /etitioner failed to -resent any other evidence that res-ondents committed to -rovide the additional allowance or that they were consistently granting s,ch +eneAt as to have ri-ened into a -ractice which cannot +e -erem-torily withdrawn. 5oreover% there is no concl,sive -roof that -etitioner6s +asic salary will +e red,ced as it was not shown that s,ch allowance is -art of -etitioner6s +asic salary. =ence% there will +e no violation of the r,le against dimin,tion of -ay en,nciated ,nder &rticle $$ of the La+or Code. LOPE& vs. KEPEL BANK PHILS. G.R. No. P!'$$% SB/TB5BBR #% ($ )&CTS* /BT3T3?NBR was the +ranch manager of Xe--el Ban1 /hili--ines% 3nc. in 3loilo City. 3n&,g,st ($$:% res-ondent s-eciAcally instr,cted him not to -roceed with =ertR B7cl,sive Cars% 3nc.Is loan a--lication +eca,se of the negative credit rating iss,ed +y the +an1Is credit committee. This% notwithstanding% Lo-eR -rocessed the loan. =e was dismissed from the service. 3SSUB* 2as the dismissal C,stiAedL SC RUL3NG* Ses. Lo-eRIs good intentions% ass,ming them to +e tr,e% are +eside the -oint +eca,se ,ltimately% what comes o,t is his deAance of a direct order of the +an1 on a matter of +,siness C,dgment. The right of an em-loyer to freely select or discharge his em-loyee is a recogniRed -rerogative of managementD an em-loyer cannot +e com-elled to contin,e em-loying one who has +een g,ilty of acts inimical to its interests. 2hen this ha--ens% the em-loyer can dismiss the em-loyee for loss of conAdence. &t the same time% loss of conAdence as a C,st ca,se of dismissal was never intended to -rovide em-loyers with a +lan1 chec1 for terminating em-loyment. Loss of conAdence sho,ld ideally a--ly only ;< to cases :( F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch involving em-loyees occ,-ying -ositions of tr,st and conAdence% or ;(< to sit,ations where the em-loyee is ro,tinely charged with the care and c,stody of the em-loyerIs money or -ro-erty. To the Arst class +elong managerial em-loyees% i.e.% those vested with the -owers and -rerogatives to lay down management -olicies and>or to hire% transfer% s,s-end% lay0oJ% recall% discharge% assign or disci-line em-loyees% or eJectively recommend s,ch managerial actions. To the second class +elong cashiers% a,ditors% -ro-erty c,stodians% or those who% in the normal and ro,tine e7ercise of their f,nctions% reg,larly handle signiAcant amo,nts of money or -ro-erty. &s +ranch manager% Lo-eR clearly occ,-ies a E-osition of tr,st.E =is hold on his -osition and his stay in the service de-end on the em-loyer6s tr,st and conAdence in him and on his managerial services. &ccording to the +an1% Lo-eR +etrayed this tr,st and conAdence when he iss,ed the s,+Cect /?s witho,t a,thority and des-ite the e7-ress directive to -,t the client6s a--lication on hold. 3n res-onse% Lo-eR insists that he had s,9cient a,thority to act as he did% as this a,thority is inherent in his -osition as +an1 manager. =e -oints to his record in the -ast when he iss,ed /?s which were honored and -aid +y the +an1 and which constit,ted the ar+iter6s Eoverwhelming evidenceE in s,--ort of the Anding that Ecom-lainant6s dismissal from wor1 was witho,t C,st ca,se% hence% illegal.E )he due process issue *** &s the NLRC and the C& did% we And Lo-eR to have +een aJorded d,e -rocess when he was dismissed. =e was given the re8,ired notices. 5ore im-ortantly% he was act,ally given the o--ort,nity to +e heardD when he moved for reconsideration of the +an16s decision to terminate his em-loyment% it sched,led a hearing where he a--eared together with his lawyer and a military man. This was an o--ort,nity to +e heard that the law recogniRes. La+or &r+iter* 3llegal dismissal NLRC* Legal dismissal C&* Legal dismissal ST. PAUL COLLEGE !UE&ON CITY, ET. AL., vs. ANCHETA II G.R. No. !""$#% SB/TB5BBR P% ($ )&CTS* RBS/?NDBNT Remigio 5ichael was hired +y the -etitioner St. /a,l College Y,eRon City ;S/CYC< as a teacher in the General Bd,cation De-artment% with a -ro+ationary ran1% in the school year ;SS< ""!0""P. This was renewed in the following SS ""P0""'. =is wife% res-ondent Cynthia% was hired +y the same school as a -art0time teacher of the 5ass Comm,nication De-artment in the second semester of SS ""!0""P and her a--ointment was renewed for SS ""P0""'. 3n res-onse to res-ondent s-o,sesI re8,est for renewal of contract% -etitioner S/CYC thro,gh Sr. Bernadete Racadio sent each of them letters +oth dated 5arch "% ""'% informing them that the school was e7tending to them new contracts for SS ""'0""". ?n &-ril :$% ""'% Sr. Racadio endorsed the immediate termination of the teaching services of res-ondent s-o,ses for fail,re to com-ly with en,merated de-artmental and instr,ctional -olicies of S/CYC. ?n 5ay @% ""'% the s-o,ses received their letters of termination. Both the la+or ar+iter and the National La+or Relations Commission ;NLRC< dismissed the res-ondentsI com-laint for illegal dismissal. The Co,rt of &--eals ;C&< granted their -etition for certiorari and reversed the decisions of the la+or ar+iter and the NLRC. 3SSUB* Did the C& errL SC RUL3NG* Ses. The common -ractice is for the em-loyer and the teacher to enter into a contract% eJective for one school year. &t the end of the school year% the em-loyer has the o-tion not to renew the contract% -artic,larly considering the teacherIs -erformance. 3f the contract is not renewed% the em-loyment relationshi- terminates. 3f the contract is renewed% ,s,ally for another school year% the -ro+ationary em-loyment contin,es. &gain% at the end of that -eriod% the -arties may o-t to renew or not to renew the contract. 3f renewed% this second renewal of the contract for another school year wo,ld then +e the last year since it wo,ld +e the third school year of -ro+ationary em-loyment. &t the end of this third year% the em-loyer may now decide whether to e7tend a -ermanent a--ointment to the em-loyee% -rimarily on the +asis of the em-loyee having met the reasona+le standards of com-etence and e9ciency set +y the em-loyer. )or the entire d,ration of this three0year -eriod% the teacher remains ,nder -ro+ation. U-on the e7-iration of his contract of em-loyment% +eing sim-ly on -ro+ation% he cannot a,tomatically claim sec,rity of ten,re and com-el the em-loyer to renew his em-loyment contract. 7 7 7 :: F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch 3t is im-ortant that the contract of -ro+ationary em-loyment s-ecify the -eriod or term of its eJectivity. The fail,re to sti-,late its -recise d,ration co,ld lead to the inference that the contract is +inding for the f,ll three0 year -ro+ationary -eriod. Therefore% the letters sent +y -etitioner Sr. Racadio% which were void of any s-eciAcs cannot +e considered as contracts. The closest they can resem+le to are that of informal corres-ondence among the said individ,als. &s s,ch% -etitioner school has the right not to renew the contracts of the res-ondents% the old ones having +een e7-ired at the end of their terms. ;St. /a,l College Y,eRon City% et. al. vs. Remigio 5ichael &. &ncheta 33% G.R. No. !""$#% Se-t. P% ($<. UMUAD vs. HI%FLYER FOOD G.R. No. 'P''P% SB/TB5BBR P% ($ .,m,ad was fo,nd to have willf,lly +reached her d,ties as to +e ,nworthy of the tr,st and conAdence of =i0)lyer. )irst% .,m,ad was a managerial em-loyeeD she e7ec,ted management -olicies and had the -ower to disci-line the em-loyees of X)C +ranches in her area. She recommended actions on em-loyees to the head o9ce. &ccording to the S,-reme Co,rt% +ased on esta+lished facts% the mere e7istence of the gro,nds for the loss of tr,st and conAdence C,stiAes -etitionerIs dismissal. 3n the -resent case% the CBRIs re-orts of =i0)lyer show that there were anomalies committed in the X)C +ranches managed +y .,m,ad. ?n the -rinci-le ofres-ondeat s,-erior or command res-onsi+ility alone% .,m,ad may +e held lia+le for negligence in the -erformance of her managerial d,ties. She may not have +een directly involved in ca,sing the cash shortages in X)C0Bohol% +,t her involvement in not -erforming her d,ty monitoring and s,--orting the day to day o-erations of the +ranches and ens,re that all the facilities and e8,i-ment at the resta,rant were -ro-erly maintained and serviced% co,ld have -revented the whole de+acle from occ,rring. NISSAN MORTOR PHILS. vs. ANGELO G.R. No. !@'% SB/TB5BBR @% ($ Neglect of d,ty% to +e a gro,nd for dismissal% m,st +e +oth gross and ha+it,al. 3n this case% Res-ondentIs re-eated fail,re to t,rn over his tas1 of -re-aring the -ayroll of the -etitionerIs em-loyees to someone ca-a+le of -erforming the vital tas1s which he co,ld not eJectively -erform or ,nderta1e +eca,se of his heart ailment or condition constit,tes gross neglect. =owever% altho,gh the dismissal was legal% res-ondent was still held to +e entitled to a se-aration -ay as a meas,re of com-assionate C,stice% considering his length of service and his -oor -hysical condition which was one of the reasons he Aled a leave of a+sence. &s a general r,le% an em-loyee who has +een dismissed for any of the C,st ca,ses en,merated ,nder &rticle ('( of the La+or Code is not entitled to se-aration -ay. By way of e7ce-tion% however% the grant of se-aration -ay or some other Anancial assistance may +e allowed to an em-loyee dismissed for C,st ca,ses on the +asis of e8,ity. PHILIPPINE NATIONAL BANK vs. PADAO G.R. No. '$'@"% N?4B5BBR !% ($ )&CTS* /adao was a credit investigator at /NB% Di-olog City +ranch. Sometime in ""@% /NB +ecame em+roiled in a scandal involving E+ehest loans.E The 8,estiona+le loans were re-ortedly +eing e7tended to select +an1 clients that the collateral -rovided in n,mero,s loan accommodations were grossly over0a--raised. The credit standing of the loan a--licants was also fa+ricated% allowing them to o+tain larger loan -ortfolios from /NB. These +orrowers event,ally defa,lted on the -ayment of their loans% ca,sing /NB to s,Jer millions in losses. /adao was administratively charged. &fter d,e investigation% /NB fo,nd /adao g,ilty of gross and ha+it,al neglect of d,ty and ordered him dismissed from the +an1. SC RUL3NG* DismissalD gross and ha+it,al neglect of d,ties. Gross negligence connotes want of care in the -erformance of oneIs d,ties% while ha+it,al neglect im-lies re-eated fail,re to -erform oneIs d,ties for a -eriod of time% de-ending on the circ,mstances. 3n the case at +ench% /adao was acc,sed of having -resented a fra,d,lently -ositive eval,ation of the +,siness% credit standing>rating and Anancial ca-a+ility of Reynaldo and L,Rvilla Bal,ma and eleven other loan a--licants. Some +,sinesses were event,ally fo,nd not to e7ist at all% while in other transactions% the Anancial stat,s of the +orrowers sim-ly co,ld not s,--ort the grant of loans in the a--roved amo,nts. 5oreover% /adao over0a--raised the collateral of s-o,ses Gardito and &lma &Cero% and that of s-o,ses 3ha+a and Rolly /ango. /adaoIs re-eated fail,re to discharge his d,ties as a credit :@ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch investigator of the +an1 amo,nted to gross and ha+it,al neglect of d,ties ,nder &rticle ('( ;+< of the La+or Code. =e not only failed to -erform what he was em-loyed to do% +,t also did so re-etitively and ha+it,ally% ca,sing millions of -esos in damage to /NB. Th,s% /NB acted within the +o,nds of the law +y meting o,t the -enalty of dismissal% which it deemed a--ro-riate given the circ,mstances. That there is no -roof that /adao derived any +eneAt from the scheme is immaterial. 2hat is cr,cial is that his gross and ha+it,al negligence ca,sed great damage to his em-loyer. /adao was aware that there was something irreg,lar a+o,t the -ractices +eing im-lemented +y his s,-eriors% +,t he went along with% +ecame -art of% and -artici-ated in the scheme. Dismissed em-loyeesD se-aration -ay. /adao is not entitled to Anancial assistance. The r,le regarding se-aration -ay as a meas,re of social C,stice is that it shall +e -aid only in those instances where the em-loyee is validly dismissed for ca,ses other than serio,s miscond,ct% willf,l diso+edience% gross and ha+it,al neglect of d,ty% fra,d or willf,l +reach of tr,st% commission of a crime against the em-loyer or his family% or those reTecting on his moral character. 3n this case% /adao was g,ilty of gross and ha+it,al neglect of d,ties. Termination of em-loymentD when com-any tolerated violation of com-any -olicy. The C& was correct in stating that when the violation of com-any -olicy or +reach of com-any r,les and reg,lations is tolerated +y management% it cannot serve as a +asis for termination. This -rinci-le% however% only a--lies when the +reach or violation is one which neither amo,nts to nor involves fra,d or illegal activities. 3n s,ch a case% one cannot evade lia+ility or c,l-a+ility +ased on o+edience to the cor-orate chain of command. 3n this case% /adao% in a97ing his signat,re on the fra,d,lent re-orts% attested to the falsehoods contained therein. 5oreover% +y doing so% he re-eatedly failed to -erform his d,ties as a credit investigator. Th,s% the termination of his em-loyment is C,stiAed. TAMSONS ENTERPRISES INC. vs. COURT OF APPEALS G.R. No. "(''% N?4B5BBR !% ($ )&CTS* ?n Se-tem+er % ($$!% Rosemarie L. Sy was hired +y Tamson6s as &ssistant to the /resident. Des-ite the title% she did not act as s,ch +eca,se% -er instr,ction of the com-any /resident% she was directed to act as -ayroll o9cer% tho,gh she act,ally wor1ed as a -ayroll cler1. ?n )e+r,ary (@% ($$P% fo,r days +efore she com-leted her si7th month of wor1ing in Tamson6s% Sy was informed that her services wo,ld +e terminated d,e to ine9ciency. She was as1ed to sign a letter of resignation and 8,itclaim. She was told not to re-ort for wor1 anymore +eca,se her services were no longer needed. D,ring her -re0em-loyment interview% Lee had nice comments a+o,t her good wor1 e7-erience and ed,cational +ac1gro,nd. She was ass,red of a long0term em-loyment with +eneAts. Thro,gho,t her em-loyment% she earnestly -erformed her d,ties% had a -erfect attendance record% wor1ed even d,ring +rowno,ts and ty-hoons% and wo,ld often wor1 overtime C,st to Anish her wor1. 3SSUB* 2?N her dismissal was valid. SC RUL3NG* /ro+ationary em-loymentD sec,rity of ten,re. 3t is settled that even if -ro+ationary em-loyees do not enCoy -ermanent stat,s% they are accorded the constit,tional -rotection of sec,rity of ten,re. This means they may only +e terminated for a C,st ca,se or when they otherwise fail to 8,alify as reg,lar em-loyees in accordance with reasona+le standards made 1nown to them +y the em-loyer at the time of their engagement. 3n this case% the C,stiAcation given +y the -etitioners for SyIs dismissal was her alleged fail,re to 8,alify +y the com-anyIs standard. ?ther than the general allegation that said standards were made 1nown to her at the time of her em-loyment% however% no evidence% doc,mentary or otherwise% was -resented to s,+stantiate the same. Neither was there any -erformance eval,ation -resented to -rove that indeed hers was ,nsatisfactory. =ence% for fail,re of the -etitioners to s,--ort their claim of ,nsatisfactory -erformance +y Sy% the SC held that SyIs em-loyment was ,nC,stly terminated to -revent her from ac8,iring a reg,lar stat,s in circ,mvention of the law on sec,rity of ten,re. /ro+ationary em-loymentD termination. Bven on the ass,m-tion that Sy indeed failed to meet the standards set +y the -etitioner0em-loyer and made 1nown to the former at the time of her engagement% still% the :# F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch termination was Tawed for fail,re to give the re8,ired notice to Sy. Section (% R,le 3% Boo1 43 of the 3m-lementing R,les -rovides that* K3f the termination is +ro,ght a+o,t +y the com-letion of a contract or -hase thereof% or +y fail,re of an em-loyee to meet the standards of the em-loyer in the case of -ro+ationary em-loyment% it shall +e s,9cient that a written notice is served the em-loyee% within a reasona+le time from the eJective date of termination.O CONCEPCION vs. MINE' IMPORT CORP. G.R. No. #:#!"% .&NU&RS (@% ($( )&CTS* Res-ondent 5ine7 3m-ort0B7-ort Cor-oration is engaged in the retail of semi0-recio,s stones% selling them in 1ios1s or stalls installed in vario,s sho--ing centers within 5etro 5anila. 3t em-loyed -etitioner Conce-cion initially as a salesgirl and then made her a s,-ervisor. ?ne day% -etitioner determined their total for three days to +e /#$%"(.$$. The ne7t day% -etitioner -honed the assistant manager to re-ort that the said amo,nt was missing% e7-laining how she and her salesgirls had -laced the wra--ed amo,nt at the +ottom of the ca+inet the night +efore% and how she had fo,nd ,-on re-orting to wor1 that morning that the contents of the ca+inet were in disarray and the money already missing. 2hile -etitioner was giving a detailed statement on the theft to the sec,rity investigator of the sho--ing center% her s,-eriors arrived with a -oliceman who immediately -laced her ,nder arrest and +ro,ght her to the -olice station where she was investigated and detained for a day. /etitioner com-lained against the res-ondents for illegal dismissal in the De-artment of La+or and Bm-loyment. 5ine7 Aled a com-laint for 8,aliAed theft against the -etitioner in the ?9ce of the City /rosec,tor in 5anila. SC RUL3NG* Bm-loyee dismissalD C,st ca,seD loss of conAdence. To dismiss an em-loyee% the law re8,ires the e7istence of a C,st and valid ca,se. &rticle ('( of the La+or Code en,merates the C,st ca,ses for termination +y the em-loyer. 3t is ,nfair to re8,ire an em-loyer to Arst +e morally certain of the g,ilt of the em-loyee +y awaiting a conviction +efore terminating him when there is already s,9cient showing of the wrongdoing. Re8,iring that certainty may -rove too late for the em-loyer% whose loss may -otentially +e +eyond re-air. 3n the -resent case% no less than the D?. Secretary fo,nd -ro+a+le ca,se for 8,aliAed theft against Conce-cion. That Anding was eno,gh to C,stify her termination for loss of conAdence. 3ndeed% the em-loyer is not e7-ected to +e as strict and rigoro,s as a C,dge in a criminal trial in weighing all the -ro+a+ilities of g,ilt +efore terminating the em-loyee. Unli1e a criminal case% which necessitates a moral certainty of g,ilt d,e to the loss of the -ersonal li+erty of the acc,sed +eing the iss,e% a case concerning an em-loyee s,s-ected of wrongdoing leads only to his termination as a conse8,ence. The 8,ant,m of -roof re8,ired for convicting an acc,sed is th,s higher ] -roof of g,ilt +eyond reasona+le do,+t ] than the 8,ant,m -rescri+ed for dismissing an em-loyee ] s,+stantial evidence. Bm-loyee dismissalD d,e -rocess. Bven if there is a C,st or valid ca,se for terminating an em-loyee% it is necessary to com-ly with the re8,irements of d,e -rocess -rior to the termination. The -etitioner -lainly demonstrated how 8,ic1ly and s,mmarily her dismissal was carried o,t witho,t Arst re8,iring her to e7-lain anything in her defense as demanded ,nder Section ( ;d< of R,le 3 of the 3m-lementing R,les of Boo1 43 of the La+or Code. 3nstead% the res-ondents forthwith had her arrested and investigated +y the -olice a,thorities for 8,aliAed theft. This% we thin1% was a denial of her right to d,e -rocess of law% consisting in the o--ort,nity to +e heard and to defend herself. 3n &ga+on v. NLRC the Co,rt said* K2here the dismissal is for a C,st ca,se% as in the instant case% the lac1 of stat,tory d,e -rocess sho,ld not n,llify the dismissal% or render it illegal% or ineJect,al. =owever% the em-loyer sho,ld indemnify the em-loyee for the violation of his stat,tory rights% as r,led in Reta v. National La+or Relations Commission.O MORALES vs. HARBOUR CENTRE PORT TERMINAL INC. G.R. No. P@($'.&NU&RS (#% ($( )&CTS* /etitioner 5orales was a Division 5anager of the &cco,nting De-artment of res-ondent =ar+o,r Centre /ort Terminal% 3nc. ;=C/T3<. S,+se8,ent to =C/T36s transfer to its new o9ces% 5orales received an inter0o9ce memorand,m reassigning him to ?-erations Cost &cco,nting. 5orales wrote Singson% =C/T3Is &dministration 5anager% -rotesting that his :! F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch reassignment was a clear demotion since the -osition to which he was transferred was not even incl,ded in =C/T36s -lantilla. 3n res-onse to 5orales6 grievance that he had +een eJectively -laced on Toating stat,s% Singson iss,ed a inter0o9ce memorand,m to the eJect that Etransfer of em-loyees is a management -rerogative.E )or the whole of the ens,ing month 5orales was a+sent from wor1 and>or tardy. &s a conse8,ence% Singson iss,ed to 5orales the following inter0o9ce memoranda* )irst 2arning% Second 2arning and a Notice to Re-ort for 2or1 and )inal 2arning. 3n the meantime% 5orales Aled a com-laint against =C/T3 for constr,ctive dismissal. =e alleged that s,+se8,ent to its transfer to its new o9ces% =C/T3 had s,s-ended all the -rivileges enCoyed +y its 5anagers% Division Chiefs and Section =eads. =C/T3 arg,ed that 5orales a+andoned his em-loyment and was not constr,ctively dismissed. SC RUL3NG* Constr,ctive dismissalD change in -osition. Constr,ctive dismissal e7ists where there is cessation of wor1 +eca,se Kcontin,ed em-loyment is rendered im-ossi+le% ,nreasona+le or ,nli1ely% as an oJer involving a demotion in ran1 or a dimin,tion in -ayO and other +eneAts. &-tly called a dismissal in disg,ise of an act amo,nting to dismissal +,t made to a--ear as if it were not% constr,ctive dismissal may% li1ewise% e7ist if an act of clear discrimination% insensi+ility% or disdain +y an em-loyer +ecomes so ,n+eara+le on the -art of the em-loyee that it co,ld foreclose any choice +y him e7ce-t to forego his contin,ed em-loyment.3n cases of a transfer of an em-loyee% the r,le is settled that the em-loyer is charged with the +,rden of -roving that its cond,ct and action are for valid and legitimate gro,nds s,ch as gen,ine +,siness necessity and that the transfer is not ,nreasona+le% inconvenient or -reC,dicial to the em-loyee. 3f the em-loyer cannot overcome this +,rden of -roof% the em-loyeeIs transfer shall +e tantamo,nt to ,nlawf,l constr,ctive dismissal. DismissalD a+andonment. &s a C,st and valid gro,nd for dismissal% at any rate% a+andonment re8,ires the deli+erate% ,nC,stiAed ref,sal of the em-loyee to res,me his em-loyment% witho,t any intention of ret,rning. Since an em-loyee li1e 5orales who ta1es ste-s to -rotest his dismissal cannot logically +e said to have a+andoned his wor1% it is a settled doctrine that the Aling of a com-laint for illegal dismissal is inconsistent with a+andonment of em-loyment. MANSION PRINTING CENTER vs. BITARA, R. G.R. No. !'($% .&NU&RS (#% ($( )&CTS* /etitioner 5ansion /rinting Center is engaged in the -rinting of 8,ality self0 adhesive la+els and the li1e. Res-ondent Bitara was the com-any6s sole driver tas1ed to -ic10,- raw materials% collect acco,nt receiva+les and deliver the -rod,cts within the delivery sched,les. /etitioner noted his ha+it,al tardiness and a+senteeism. /etitioner iss,ed several memoranda to res-ondent re8,iring the latter to s,+mit written e7-lanations* Arst% as to why no administrative sanction sho,ld +e im-osed on him for his ha+it,al tardinessD and then several months later% after BitaraIs a-ology and a failed ,nderta1ing to adhere to the attendance -olicies% why his services sho,ld not +e terminated. The last memoranda was -ersonally handed to him% +,t the latter% after reading the directive% ref,sed to ac1nowledge recei-t thereof. =e did not s,+mit any e7-lanation and% thereafter% never re-orted for wor1. &s a conse8,ence% Davis Cheng% General 5anager% -ersonally served another 5emorand,m ;Notice of Termination< ,-on him informing him that the com-any fo,nd him grossly negligent of his d,ties% for which reason% his services were terminated. Res-ondent met with the management re8,esting for reconsideration of his termination. =owever% after hearing his -osition% the management decided to im-lement the last 5emorand,m. Res-ondent Aled a com-laint for illegal dismissal. SC RUL3NG* Bm-loyee dismissalD gross negligenceD ha+it,al neglect. Gross negligence has +een deAned as the Kwant of care in the -erformance of oneIs d,tiesO and ha+it,al neglect has +een deAned as Kre-eated fail,re to -erform oneIs d,ties for a -eriod of time% de-ending ,-on the circ,mstances.O These are not overly technical terms% which% in the Arst -lace% are e7-ressly sanctioned +y the La+or Code of the /hili--ines% to wit* &RT. ('(. Termination +y em-loyer. &n em-loyer may terminate an em-loyment for any of the following ca,ses* M777N;+< Gross and ha+it,al neglect +y the em-loyee of his d,tiesD M777N Diosdado Bitara was dismissed from service d,e to ha+it,al tardiness and a+senteeism% and for having contin,ed disregarding attendance -olicies des-ite his ,nderta1ing to re-ort on time. =is wee1ly time record for the Arst 8,arter of the year ($$$ revealed that he came late " times o,t of the @P times he re-orted for wor1. =e also inc,rred " a+sences o,t of the !! wor1ing days d,ring the 8,arter. =is :P F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch a+sences witho,t -rior notice and a--roval from 5arch 0!% ($$$ were considered to +e the most serio,s infraction of all +eca,se of its adverse eJect on +,siness o-erations. The S,-reme Co,rt held that even in the a+sence of a written com-any r,le deAning gross and ha+it,al neglect of d,ties% BitaraIs omissions 8,alify as s,ch warranting his dismissal from the service. DismissalD -roced,ral d,e -rocess. /roced,ral d,e -rocess entails com-liance with the two0notice r,le in dismissing an em-loyee% to wit* ;< the em-loyer m,st inform the em-loyee of the s-eciAc acts or omissions for which his dismissal is so,ghtD and ;(< after the em-loyee has +een given the o--ort,nity to +e heard% the em-loyer m,st inform him of the decision to terminate his em-loyment. 3n B,ghaw v. Treas,re 3sland 3nd,strial Cor-oration% this Co,rt% in verifying the veracity of the allegation that res-ondent ref,sed to receive the Notice of Termination% essentially loo1ed for the following* ;< a9davit of service stating the reason for fail,re to serve the notice ,-on the reci-ientD and ;(< a notation to that eJect% which shall +e written on the notice itself. 2e are convinced that the notices have +een validly served. MANILA ELECTRIC CO. vs. BELTRAN G.R. No. P:PP@% .&NU&RS :$% ($( )&CTS* /etitioner% the res-ondentIs em-loyer% dismissed the latter on the gro,nd of +reach of tr,st and conAdence for allegedly having withheld and misa--ro-riated for her -ersonal -,r-ose or +eneAt an electric +ill -ayment of a 5eralco c,stomer. Res-ondent Aled for illegal dismissal against -etitioner and arg,ed that Kshe had no intention to withhold com-any f,nds. Besides% it was not her c,stomary d,ty to collect and remit -ayments from c,stomers. She claimed good faith% +elieving that her acce-tance of Chang6s -ayment is considered goodwill in favor of +oth 5BR&LC? and its c,stomer. 3f at all% her only violation was a sim-le delay in remitting the -ayment% which ca,sed no considera+le harm to the com-any. ),rther% her nine years of ,n+lemished service to the com-any sho,ld +e ta1en into acco,nt s,ch that the -enalty of dismissal is not a commens,rate -enalty for the ,nintentional act committed.O 5BR&LC?% on the other hand% maintained that ,nder com-any -olicy% Beltran had the d,ty to remit -ayment for electric +ills +y any c,stomer on the day the same was received. 3t o-ined that if indeed the money was 1e-t intact inside the drawer and was not -,t to -ersonal ,se% Beltran co,ld have easily t,rned over the same when Garcia instr,cted her to do so on .an,ary P% ""P. =owever% Beltran failed to remit the money on said date and even on the following day% .an,ary '% when she re-orted for wor1. 2orse% in the two s,cceeding days% she went on leave. Th,s% there was a clear sign of misa--ro-riation of com-any f,nds% considered a serio,s miscond,ct and -,nisha+le +y dismissal from the service. ),rther% Beltran6s reason for her fail,re to -erform s,ch o+ligation on acco,nt of family -ro+lems deserves scant consideration. 5BR&LC? insisted that Beltran6s act renders her ,nworthy of the tr,st and conAdence demanded of her -osition. L& r,led for res-ondent stating that the -enalty of dismissal as not commens,rate to the degree of infraction committed as there was no ade8,ate -roof of misa--ro-riation on the -art of Beltran and that it was ,nintentional and same cannot serve as s,9cient +asis to concl,de that there was misa--ro-riation of com-any f,nds. 2hile the La+or &r+iter commiserated with Beltran6s circ,mstances and too1 into acco,nt her long and ,ntainted service% he nonetheless im-osed disci-linary action in the form of forfeit,re of salary for her neglect in remitting the f,nds at once. NLRC reversed and fo,nd that Beltran withheld com-any f,nds +y failing to remit it for almost fo,r months. 3t disregarded Beltran6s assertion of family -ro+lems as the same cannot +e ,sed as an e7c,se for committing a serio,s miscond,ct in violation of the tr,st re-osed on her as a Senior Branch Cler1. The NLRC was convinced that Beltran ,sed the money for her -ersonal needs since her act of ta1ing a leave of a+sence right after her confrontation with Garcia s,ggested that she needed time to -rod,ce it. The NLRC th,s r,led that 5BR&LC? validly dismissed Beltran from the service in the e7ercise of its inherent right to disci-line its em-loyees. 3t li1ewise denied BeltranIs 5R. C& a9rmed L&. 3SSUB* 2=BT=BR ?R N?T C& SBR3?USLS BRRBD 3N ?RDBR3NG T=B RB3NST&TB5BNT ?) BBLTR&N DBS/3TB T=B UND3S/UTBD )3ND3NG T=&T S=B 3S GU3LTS ?) 23T==?LD3NG C?5/&NS )UNDS. SC RUL3NG* :' F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch Co,rt Ands for res-ondent% a9rms C&. )or loss of tr,st and conAdence to +e a valid gro,nd for dismissal% it m,st +e +ased on a willf,l +reach of tr,st and fo,nded on clearly esta+lished facts. & +reach is willf,l if it is done intentionally% 1nowingly and -,r-osely% witho,t C,stiAa+le e7c,se% as disting,ished from an act done carelessly% tho,ghtlessly% heedlessly or inadvertently. 3n addition% loss of tr,st and conAdence m,st rest on s,+stantial gro,nds and not on the em-loyer6s ar+itrariness% whims% ca-rices or s,s-icion. 3n the case at +ench% Beltran attri+,ted her delay in t,rning over Chang6s -ayment to her di9c,lt family sit,ation as she and her h,s+and were having marital -ro+lems and her child was s,Jering from an illness. &dmittedly% she was reminded of Chang6s -ayment +y her s,-ervisor on .an,ary P% ""P +,t denied having +een ordered to remit the money on that day. She then reasoned that her contin,ed delay was ca,sed +y an inevita+le need to ta1e a leave of a+sence for her to attend to the needs of her child who was s,Jering from asthma. 3t sho,ld +e em-hasiRed at this -oint that the +,rden of -roving the legality of an em-loyee6s dismissal lies with the em-loyer. EUns,+stantiated s,s-icions% acc,sations% and concl,sions of em-loyers do not -rovide legal C,stiAcation for dismissing em-loyees.E E5ere conCect,res cannot wor1 to de-rive em-loyees of their means of livelihood.E To +egin with% 5BR&LC? cannot claim or concl,de that Beltran misa--ro-riated the money +ased on mere s,s-icion. The NLRC th,s erred in concl,ding that Beltran made ,se of the money from the mere fact that she too1 a leave of a+sence after having +een reminded of the ,nremitted f,nds. &nd even if Beltran delayed handing over the f,nds to the com-any% 5BR&LC? still has the +,rden of -roof to show clearly that s,ch act of negligence is s,9cient to C,stify termination from em-loyment. 5oreover% we And that Beltran6s delay does not clearly and convincingly esta+lish a willf,l +reach on her -art% that is% which is done Eintentionally% 1nowingly and -,r-osely% witho,t any C,stiAa+le e7c,se.E Tr,e% the reasons Beltran -roJered for her delay in remitting the cash -ayment are mere allegations witho,t any concrete -roof. Nonetheless% we em-hasiRe that as the em-loyer% the +,rden still lies on 5BR&LC? to -rovide clear and convincing facts ,-on which the alleged loss of conAdence is to +e made to rest. Undo,+tedly% Beltran was remiss in her d,ties for her fail,re to immediately t,rn over Chang6s -ayment to the com-any. S,ch negligence% however% is not s,9cient to warrant se-aration from em-loyment. To C,stify removal from service% the negligence sho,ld +e gross and ha+it,al. EGross negligence . . . is the want of even slight care% acting or omitting to act in a sit,ation where there is d,ty to act% not inadvertently +,t willf,lly and intentionally% with a conscio,s indiJerence to conse8,ences insofar as other -ersons may +e aJected.E :$ =a+it,al neglect% on the other hand% connotes re-eated fail,re to -erform one6s d,ties for a -eriod of time% de-ending ,-on the circ,mstances. No concrete evidence was -resented +y 5BR&LC? to show that Beltran6s delay in remitting the f,nds was done intentionally. Neither was it shown that same is willf,l% ,nlawf,l and felonio,s contrary to 5BR&LC?6s Anding as stated in the letter of termination it sent to Beltran. S,rely% Beltran6s single and isolated act of negligence cannot C,stify her dismissal from service. 5oreover% Beltran6s sim-le negligence did not res,lt in any loss. )rom the time she received the -ayment on Se-tem+er ('% ""! ,ntil .an,ary P% ""P when she was a--rised +y her s,-ervisor a+o,t Chang6s -ayment% no harm or damage to the com-any or to its c,stomers attri+,ta+le to Beltran6s negligence was alleged +y 5BR&LC?. &lso% from the time she was a--rised of the non0remittance +y her s,-erior on .an,ary P% ""P% ,ntil the t,rn0over of the amo,nt on .an,ary :% ""P% no s,ch harm or damage was ever claimed +y 5BR&LC?. Under the circ,mstances% 5BR&LC?6s sanction of dismissal will not +e commens,rate to Beltran6s inadvertence not only +eca,se there was no clear showing of +ad faith and malice +,t also in consideration of her ,ntainted record of long and dedicated service to 5BR&LC?. 3n the similar case of /hili--ine Long Distance Tele-hone Com-any v. Ber+ano% .r.% we held that* The magnit,de of the infraction committed +y an em-loyee m,st +e weighed and e8,ated with the -enalty -rescri+ed and m,st +e commens,rate thereto% in view of the gravity of the -enalty of dismissal or termination from the service. The em-loyer sho,ld +ear in mind that in termination cases% what is at sta1e is not sim-ly the em-loyee6s Co+ or -osition +,t MherN very livelihood. 2here a -enalty less -,nitive wo,ld s,9ce% whatever misste-s may +e committed +y an em-loyee o,ght not to +e visited with a conse8,ence so severe s,ch as dismissal from em-loyment. =ence% we And no reversi+le error or any grave a+,se of discretion on the -art of the C& in ordering Beltran6s reinstatement witho,t +ac1wages. The forfeit,re of her salary is an e8,ita+le -,nishment for the sim-le negligence committed. :" F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch BANK OF LUBAO vs. MANABAT, ET. AL. G.R. No. ''P((% )BBRU&RS % ($( )&CTS* Res-ondent which was a mar1et collector and s,+se8,ently assigned as an encoder of the Ban1 of L,+ao6s Sta. Cr,R B7tension ?9ce% was terminated from his em-loyment +y reason of serio,s miscond,ct tantamo,nt to willf,l +reach of tr,st and was li1ewise charged with criminal com-laints for Y,aliAed Theft with a certain Lingad. Res-ondent6s -rimary d,ty is to encode the clients6 de-osits on the +an16s com-,ter after the same are received +y Lingad. /etitioner after investigation had Andings of discre-ancies d,ring the a,dit that showed a misa--ro-riation of f,nds in the amo,nt of / :%$$$%$$$.$$% hence the dismissal from service. Res-ondent Aled a Com-laint : for illegal dismissal with the Regional &r+itration Branch of the National La+or Relations Commission ;NLRC< in San )ernando City% /am-anga. 3n the said com-laint% the res-ondent% to +olster his claim that there was no valid gro,nd for his dismissal% averred that the charge against him for 8,aliAed theft was dismissed for lac1 of s,9cient +asis to concl,de that he cons-ired with Lingad. The res-ondent so,ght an award for se-aration -ay% f,ll +ac1wages% :th month -ay for ($$@ and moral and e7em-lary damages. )or its -art% the -etitioner insists that the dismissal of the res-ondent is C,stiAed% asserting the )e+r,ary @% ($$! &,dit Re-ort which conArmed the -artici-ation of the res-ondent in the alleged misa--ro-riations. Li1ewise% the -etitioner asserted that the dismissal of the 8,aliAed theft charge against the res-ondent is immaterial to the validity of the gro,nd for the latter6s dismissal. L& s,stained res-ondent6s claim of illegal dismissal th,s ordering the -etitioner to reinstate the res-ondent to his former -osition and awarding the latter +ac1wages in the amo,nt of /%"!$.$$ and :th month -ay in the amo,nt of /!%(($.$$. The L& o-ined that the -etitioner failed to add,ce s,+stantial evidence that there was a valid gro,nd for the res-ondent6s dismissal. NLRC a9rmed decision of L&* Kit was s,9ciently esta+lished that only Lingad was the one res-onsi+le for the said misa--ro-riations. ),rther% the NLRC asserted that the )e+r,ary @% ($$! and &-ril :$% ($$P a,dit re-orts -resented +y the -etitioner co,ld not +e given evidentiary weight as the same were e7ec,ted after the res-ondent had already +een dismissed.O NLRC denied 5R of -etitioner. C& denied -etitionerIs Certiorari% C& agreed with the L& and the NLRC that the -etitioner failed to esta+lish +y s,+stantial evidence that there was indeed a valid gro,nd for the res-ondent6s dismissal. Nevertheless% the C& held that the -etitioner sho,ld -ay the res-ondent se-aration -ay since the latter did not -ray for reinstatement +efore the L& and that the same wo,ld +e in the +est interest of the -arties considering the animosity and antagonism that e7ist +etween them. 3SSUBS* 2hether or not the C& erred in ordering the -etitioner to -ay the res-ondent se-aration -ay in lie, of reinstatementD 2hether or not the res-ondent is entitled to -ayment of +ac1wages. SC RUL3NG* Co,rt Ands for res-ondent% ,-held ,nanimo,s decisions of L&% NLRC and C&. Doctrine of Strained Relations. Under the law and -revailing C,ris-r,dence% an illegally dismissed em-loyee is entitled to reinstatement as a matter of right. =owever% if reinstatement wo,ld only e7acer+ate the tension and strained relations +etween the -arties% or where the relationshi- +etween the em-loyer and the em-loyee has +een ,nd,ly strained +y reason of their irreconcila+le diJerences% -artic,larly where the illegally dismissed em-loyee held a managerial or 1ey -osition in the com-any% it wo,ld +e more -r,dent to order -ayment of se-aration -ay instead of reinstatement. Under the doctrine of strained relations% the -ayment of se-aration -ay is considered an acce-ta+le alternative to reinstatement when the latter o-tion is no longer desira+le or via+le. ?n one hand% s,ch -ayment li+erates the em-loyee from what co,ld +e a highly o--ressive wor1 environment. ?n the other hand% it releases the em-loyer from the grossly ,n-alata+le o+ligation of maintaining in its em-loy a wor1er it co,ld no longer tr,st. 3n s,ch cases% it sho,ld +e -roved that the em-loyee concerned occ,-ies a -osition where he enCoys the tr,st and conAdence of his em-loyerD and that it is li1ely that if reinstated% an atmos-here of anti-athy and antagonism @$ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch may +e generated as to adversely aJect the e9ciency and -rod,ctivity of the em-loyee concerned. =ere% we agree with the C& that the relations +etween the -arties had +een already strained there+y C,stifying the grant of se-aration -ay in lie, of reinstatement in favor of the res-ondent. )irst% it cannot +e gainsaid that the -etitioner6s reinstatement to his former -osition wo,ld only serve to intensify the atmos-here of anti-athy and antagonism +etween the -arties. Undo,+tedly% the -etitioner6s Aling of vario,s criminal com-laints against the res-ondent for 8,aliAed theft and the s,+se8,ent Aling +y the latter of the com-laint for illegal dismissal against the latter% ta1en together with the -endency of the instant case for more than si7 years% had ca,sed strained relations +etween the -arties. Second% considering that the res-ondent6s former -osition as +an1 encoder involves the handling of acco,nts of the de-ositors of the Ban1 of L,+ao% it wo,ld not +e e8,ita+le on the -art of the -etitioner to +e ordered to maintain the former in its em-loy since it may only ins-ire vindictiveness on the -art of the res-ondent. Third% the ref,sal of the res-ondent to +e re0 admitted to wor1 is in itself indicative of the e7istence of strained relations +etween him and the -etitioner. 3n the case of Lagniton% Sr. v. National La+or Relations Commission% the Co,rt held that the ref,sal of the dismissed em-loyee to +e re0admitted is constit,tive of strained relations* 3t a--ears that relations +etween the -etitioner and the com-lainants have +een so strained that the com-lainants are no longer willing to +e reinstated. &s s,ch reinstatement wo,ld only e7acer+ate the animosities that have develo-ed +etween the -arties% the -,+lic res-ondents were correct in ordering instead the grant of se-aration -ay to the dismissed em-loyees in the interest of ind,strial -eace. Time and again% this Co,rt has recogniRed that strained relations +etween the em-loyer and em-loyee is an e7ce-tion to the r,le re8,iring act,al reinstatement for illegally dismissed em-loyees for the -ractical reason that the already e7isting antagonism will only fester and deteriorate% and will only worsen with -ossi+le adverse eJects on the -arties% if we shall com-el reinstatementD th,s% the ,se of a via+le s,+stit,te that -rotects the interests of +oth -arties while ens,ring that the law is res-ected. #ackwages. The arg,ments raised +y the -etitioner with regard to the iss,e of +ac1wages% essentially% attac1s the fact,al Andings of the C&% the NLRC and the L&. &s stated earlier% s,+Cect to well0deAned e7ce-tions% fact,al 8,estions may not +e raised in a -etition for review on certiorari ,nder R,le @# as this Co,rt is not a trier of facts. The -etitioner failed to assert any circ,mstance which wo,ld im-el this Co,rt to disregard the Andings of fact of the lower tri+,nals on the -ro-riety of the award of +ac1wages in favor of the res-ondent. =owever% the +ac1wages that sho,ld +e awarded to the res-ondent sho,ld +e modiAed. Bm-loyees who are illegally dismissed are entitled to f,ll +ac1wages% incl,sive of allowances and other +eneAts or their monetary e8,ivalent% com-,ted from the time their act,al com-ensation was withheld from them ,- to the time of their act,al reinstatement. B,t if reinstatement is no longer -ossi+le% the +ac1wages shall +e com-,ted from the time of their illegal termination ,- to the Anality of the decision. Th,s% when there is an order of reinstatement% the com-,tation of +ac1wages shall +e rec1oned from the time of illegal dismissal ,- to the time that the em-loyee is act,ally reinstated to his former -osition. /,rs,ant to the order of reinstatement rendered +y the L&% the -etitioner sent the res-ondent a letter re8,iring him to re-ort +ac1 to wor1 on 5ay @% ($$P. Notwithstanding the said letter% the res-ondent o-ted not to re-ort for wor1. Th,s% it is +,t fair that the +ac1wages that sho,ld +e awarded to the res-ondent +e com-,ted from the time that the res-ondent was illegally dismissed ,ntil the time when he was re8,ired to re-ort for wor1% i.e.% from Se-tem+er % ($$# ,ntil 5ay @% ($$P. 3t is only d,ring the said -eriod that the res-ondent is deemed to +e entitled to the -ayment of +ac1wages. The fact that the C&% in its &-ril @% ($$" decision% ordered the -ayment of se-aration -ay in lie, of the res-ondent6s reinstatement wo,ld not entitle the latter to +ac1wages. 3t +ears stressing that decisions of the C&% ,nli1e that of the L&% are not immediately e7ec,tory. &ccordingly% the -etitioner sho,ld only -ay the res-ondent +ac1wages from Se-tem+er % ($$#% the date when the res-ondent was illegally dismissed% ,ntil 5ay @% ($$P% the date when the -etitioner re8,ired the former to re-ort to wor1. CANADIAN OPPORTUNITIES UNLIMITED vs. DALANGIN G.R. No. P(((:% )BBRU&RS !% ($( )&CTS* @ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch Res-ondent was hired as 3mmigration and Legal 5anager of -etitioner com-any. =e was -laced on -ro+ation for si7 months. =e was to re-ort directly to the Chief ?-erations ?9cer% &nnie LlamanRares &+ad. =is tas1s involved -rinci-ally the review of the clients6 a--lications for immigration to Canada to ens,re that they are in accordance with Canadian and /hili--ine laws. The com-any terminated Dalangin6s em-loyment% declaring him E,nAtE and E,n8,aliAedE to contin,e as 3mmigration and Legal 5anager on the gro,nds of* a. ?+stinacy and ,tter disregard of com-any -olicies. /ro-ensity to ta1e -rolonged and e7tended l,nch +rea1s% shows no interest in familiariRing oneself with the -olicies and o+Cectives. +. Lac1 of concern for the com-any6s interest des-ite having C,st +een em-loyed in the com-any. ;Declined to attend com-any s-onsored activities% seminars intended to familiariRe com-any em-loyees with 5anagement o+Cectives and enhancement of com-any interest and o+Cectives.< c. Showed lac1 of enth,siasm toward wor1. d. Showed lac1 of interest in fostering relationshi- with his co0 em-loyees. Res-ondent Aled a com-laint for illegal dismissal with -rayer for reinstatement and +ac1wages% as well as damages ;moral and e7em-lary< and attorney6s fees% against -etitioner. =e arg,es that the seminar he was re8,ired to attend +ears no connection with his d,ties and f,nctions and that it is +eyond his wor1 ho,rs as sti-,lated in his em-loyment contract. &side from that he -osits that he sho,ld not +e treated similarly with other em-loyees ;re8,ired to attend s,ch seminars< as they are diJerently sit,ated in terms of -ositions and d,ties. Thro,gh their -osition -a-er% the com-any and its -rinci-al o9cers alleged that at the time of Dalangin6s engagement% he was advised that he was ,nder -ro+ation for si7 months and his em-loyment co,ld +e terminated sho,ld he fail to meet the standards to 8,alify him as a reg,lar em-loyee. =e was informed that he wo,ld +e eval,ated on the +asis of the res,lts of his wor1D on his attit,de towards the com-any% his wor1 and his co0 em-loyees% as s-elled o,t in his Co+ descri-tion. The com-any arg,ed that since Dalangin failed to 8,alify for the -osition of 3mmigration and Legal 5anager% the com-any decided to terminate his services% after d,ly notifying him of the com-any6s decision and the reason for his se-aration. L& declared Dalangin6s dismissal illegal% and awarded him +ac1wages of /P#%$$$.$$% moral damages of /#$%$$$.$$ and e7em-lary damages of /#$%$$$.$$% -l,s $Q attorney6s fees. The la+or ar+iter fo,nd that the charges against Dalangin% which led to his dismissal% were not esta+lished +y clear and s,+stantial -roof. NLRC rendered a decision on 5arch (!% ($$@ granting the a--eal% there+y reversing the la+or ar+iter6s r,ling. 3t fo,nd Dalangin6s dismissal to +e a valid e7ercise of the com-any6s management -rerogative +eca,se Dalangin failed to meet the standards for reg,lar em-loyment. NLRC denied 5R. C& fo,nd for res-ondent agreeing with L& that he was illegally dismissed. C& fo,nd that the com-any failed to s,--ort% with s,+stantial evidence% its claim that Dalangin failed to meet the standards to 8,alify as a reg,lar em-loyee. C& -ointed o,t that the com-any did not allow Dalangin to -rove that he -ossessed the 8,aliAcations to meet the reasona+le standards for his reg,lar em-loymentD instead% it dismissed Dalangin -erem-torily from the service. 3t o-ined that it was 8,ite im-ro+a+le that the com-any co,ld f,lly determine Dalangin6s -erformance +arely one month into his em-loyment. C& denied 5R. 3SSUB* 2hether or not res-ondent as a -ro+ationary em-loyee was validly dismissed. SC RUL3NG* Co,rt Ands for -etitionerAnding s,+stantial evidence indicating that the com-any was C,stiAed in terminating Dalangin6s em-loyment% however +rief it had +een. ?ne month eno,gh to determine res-ondentIs ,nAtness% -ro+ationary term or -eriod denotes its -,r-ose +,t not its length. Dalangin admitted in com-,lsory ar+itration that the -ro7imate ca,se for his dismissal was his ref,sal to attend the com-any6s E4al,es )ormation SeminarE sched,led for ?cto+er (P% ($$% a Sat,rday. =e ref,sed to attend the seminar after he learned that it had no relation to his d,ties% as he claimed% and that he had to leave at (*$$ -.m. +eca,se he wanted to +e with his family in the -rovince. 2hen &+ad insisted that he attend the seminar to enco,rage his co0em-loyees to attend% he stood -at on not attending% arg,ing that mar1ed diJerences e7ist +etween their -ositions and d,ties% and @( F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch insin,ating that he did not want to Coin the other em-loyees. =e also 8,estioned the sched,led (*$$ -.m. seminars on Sat,rdays as they were not s,--osed to +e doing a com-any activity +eyond (*$$ -.m. =e considers (*$$ -.m. as the close of wor1ing ho,rs on Sat,rdaysD th,s% holding them +eyond (*$$ -.m. wo,ld +e in violation of the law. The E4al,es )ormation SeminarE incident is an eye0o-ener on the 1ind of -erson and em-loyee Dalangin was. =is ref,sal to attend the seminar +rings into foc,s and validates what was wrong with him% as &+ad narrated in her a9davit and as reTected in the termination of em-loyment memorand,m. 3t highlights his lac1 of interest in familiariRing himself with the com-any6s o+Cectives and -olicies. SigniAcantly% the seminar involved ac8,ainting and ,-dating the em-loyees with the com-any6s -olicies and o+Cectives. =ad he attended the seminar% Dalangin co,ld have +roadened his awareness of the com-any6s -olicies% in addition to &+ad6s +rieAng him a+o,t the com-any6s -olicies on -,nct,ality and attendance% and the -roced,res to +e followed in handling the clients6 a--lications. No wonder the com-any charged him with o+stinacy. The incident also reveals Dalangin6s lac1 of interest in esta+lishing good wor1ing relationshi- with his co0em-loyees% es-ecially the ran1 and AleD he did not want to Coin them +eca,se of his view that the seminar was not relevant to his -osition and d,ties. 3t also +etrays an arrogant and condescending attit,de on his -art towards his co0em-loyees% and a lac1 of s,--ort for the com-any o+Cective that com-any managers +e e7am-les to the ran1 and Ale em-loyees. &dditionally% very early in his em-loyment% Dalangin e7hi+ited negative wor1ing ha+its% -artic,larly with res-ect to the one ho,r l,nch +rea1 -olicy of the com-any and the o+servance of the com-any6s wor1ing ho,rs. Th,s% &+ad stated that Dalangin wo,ld ta1e -rolonged l,nch +rea1s or wo,ld go o,t of the o9ce ] witho,t leave of the com-any ] only to call the -ersonnel manager later to inform the latter that he wo,ld +e ,na+le to ret,rn as he had to attend to -ersonal matters. 2itho,t e7-ressly co,ntering or denying &+ad6s statement% Dalangin dismissed the charge for the com-any6s fail,re to -rod,ce his daily time record. The same thing is tr,e with Dalangin6s handling of Tecson6s a--lication for immigration to Canada% es-ecially his fail,re to And ways to a--eal the denial of Tecson6s a--lication% as &+ad stated in her a9davit. &gain% witho,t e7-ressly denying &+ad6s statement or e7-laining e7actly what he did with Tecson6s a--lication% Dalangin +r,shes aside &+ad6s insin,ation that he was not doing his Co+ well% with the ready arg,ment that the com-any did not even +other to -resent Tecson6s testimony. 3n the face of &+ad6s direct statements% as well as those of his co0 em-loyees% it is -,RRling that Dalangin chose to +e silent a+o,t the charges% other than saying that the com-any co,ld not cite any -olicy he violated. &ll along% he had +een com-laining that he was not a+le to e7-lain his side% yet from the la+or ar+iter6s level% all the way to this Co,rt% he oJered no satisfactory e7-lanation of the charges. 3n this light% co,-led with Dalangin6s adamant ref,sal to attend the com-any6s E4al,es )ormation SeminarE and a similar -rogram sched,led earlier% we And credence in the com-any6s s,+mission that Dalangin was ,nAt to contin,e as its 3mmigration and Legal 5anager. &s we stressed earlier% we are convinced that the com-any had seen eno,gh from Dalangin6s act,ations% +ehavior and de-ortment d,ring a fo,r0wee1 -eriod to realiRe that Dalangin wo,ld +e a lia+ility rather than an asset to its o-erations. 2e% therefore% disagree with the C& that the com-any co,ld not have f,lly determined Dalangin6s -erformance +arely one month into his em-loyment. &s we said in 3nternational Catholic 5igration Commission% the -ro+ationary term or -eriod denotes its -,r-ose +,t not its length. To o,r mind% fo,r wee1s was eno,gh for the com-any to assess Dalangin6s Atness for the Co+ and he was fo,nd wanting. 3n se-arating Dalangin from the service +efore the sit,ation got worse% we And the com-any not lia+le for illegal dismissal. /roced,ral D,e /rocess. The notice served on him did not give him a reasona+le time% from the eJective date of his se-aration% as re8,ired +y the r,les. =e was dismissed on the very day the notice was given to him% or% on ?cto+er (P% ($$. <ho,gh we cannot invalidate his dismissal in light of the valid ca,se for his se-aration% the com-any6s non0com-liance with the notice re8,irement entitles Dalangin to indemnity% in the form of nominal damages in an amo,nt s,+Cect to o,r discretion. @$ Under the circ,mstances% we consider a--ro-riate an award of nominal damages of /$%$$$.$$ to Dalangin. MANILA ELECTRIC COMPANY vs. GALA G.R. No. "('' U ":$@% )BBRU&RS ("% ($( )&CTS* @: F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch Res-ondent was em-loyed as a -ro+ationary lineman of -etitioner com-any% +arely @ months on the Co+ he was dismissed for alleged com-licity in -ilferages of 5eralco6s electrical s,--lies% -artic,larly% for the incident which too1 -lace on 5ay (#% ($$!. ?n that day% Gala and other 5eralco wor1ers were instr,cted to re-lace a worn0o,t electrical -ole at the /acheco S,+division in 4alenR,ela City. 2hile the 5eralco crew was at wor1% one No+erto EBingE Llanes% a non0 5eralco em-loyee% arrived. =e a--eared to +e 1nown to the 5eralco foremen as they were seen conversing with him. Llanes +oarded the tr,c1s% witho,t +eing sto--ed% and too1 o,t what were later fo,nd as electrical s,--lies. &side from Gala% the foremen and the other linemen who were at the wor1site when the -ilferage ha--ened were later charged with miscond,ct and dishonesty for their involvement in the incident. Un1nown to them the whole incident was +eing videoed +y 5eralco s,rveillance tas1 force. 5eralco called for an investigation of the incident and as1ed Gala to e7-lain. Gala denied involvement in the -ilferage% contending that even if his s,-eriors might have committed a wrongdoing% he had no -artici-ation in what they did. =e claimed that* ;< he was at some distance away from the tr,c1s when the -ilferage ha--enedD ;(< he did not have an in1ling that an illegal activity was ta1ing -lace since his s,-ervisors were conversing with Llanes% giving him the im-ression that they 1new himD ;:< he did not call the attention of his s,-eriors +eca,se he was not in a -osition to do so as he was a mere linemanD and ;@< he was C,st following instr,ctions in connection with his wor1 and had no control in the dis-osition of com-any s,--lies and materials. =e maintained that his mere -resence at the scene of the incident was not s,9cient to hold him lia+le as a cons-irator. Des-ite Gala6s e7-lanation% 5eralco -roceeded with the investigation and event,ally terminated his em-loyment on .,ly (P% ($$!. Gala res-onded +y Aling an illegal dismissal com-laint against 5eralco. L& dismissed the com-laint for lac1 of merit. She held that Gala6s -artici-ation in the -ilferage of 5eralco6s -ro-erty rendered him ,n8,aliAed to +ecome a reg,lar em-loyee. NLRC reversed the la+or ar+iter6s r,ling. 3t fo,nd that Gala had +een illegally dismissed% since there was Eno concrete showing of com-licity with the alleged miscond,ct>dishonestyM.NE The NLRC% however% r,led o,t Gala6s reinstatement% stating that his ten,re lasted only ,- to the end of his -ro+ationary -eriod. 3t awarded him +ac1wages and attorney6s fees. Both -arties moved for -artial reconsiderationD Gala% on the gro,nd that he sho,ld have +een reinstated with f,ll +ac1wages% damages and interestsD and 5eralco% on the gro,nd that the NLRC erred in Anding that Gala had +een illegally dismissed. The NLRC denied the motions. C& denied 5eralco6s -etition for lac1 of merit and -artially granted Gala6s -etition. 3t conc,rred with the NLRC that Gala had +een illegally dismissed% a r,ling that was s,--orted +y the evidence. 3t o-ined that nothing in the records show Gala6s 1nowledge of or com-licity in the -ilferage. 3t ordered Gala6s reinstatement with f,ll +ac1wages and other +eneAts. The C& also denied 5eralco6s motion for reconsideration. 3SSUB* 2hether or not res-ondent was illegaly dismissed. SC RUL3NG* Co,rt Ands for -etitioner% contrary to concl,sions of NLRC and C&. Res-ondent failed to meet standards and 8,aliAcation of com-any. Gala misses the -oint. =e forgets that as a -ro+ationary em-loyee% his overall Co+ -erformance and his +ehavior were +eing monitored and meas,red in accordance with the standards ;i.e.% the terms and conditions< laid down in his -ro+ationary em-loyment agreement. (( Under -aragra-h ' of the agreement% he was s,+Cect to strict com-liance with% and non0violation of the Com-any Code on Bm-loyee Disci-line% Safety Code% r,les and reg,lations and e7isting -olicies. /ar. $ re8,ired him to o+serve at all times the highest degree of trans-arency% selTessness and integrity in the -erformance of his d,ties and res-onsi+ilities% free from any form of conTict or contradicting with his own -ersonal interest. TD&=CS The evidence on record esta+lished Gala6s -resence in the wor1site where the -ilferage of com-any -ro-erty ha--ened. 3t also esta+lished that it was not only on 5ay (#% ($$! that Llanes% the -ilferer% had +een seen d,ring a 5eralco o-eration. =e had +een -revio,sly noticed +y 5eralco em-loyees% incl,ding Gala ;+ased on his admission<% in -ast o-erations. 3f Gala had seen Llanes in earlier -roCects or o-erations of the com-any% it is incred,lo,s for him to say that he did not 1now why Llanes was there or what W,Viga and Llanes were tal1ing a+o,t. To o,r mind% the 5eralco crew ;the foremen and the linemen< allowed or co,ld have even as1ed Llanes to +e there d,ring their o-erations for one and only -,r-ose ] to serve as their cond,it for -ilfered com-any s,--lies to +e sold to ready +,yers o,tside 5eralco wor1sites. @@ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch The familiarity of the 5eralco crew with Llanes% a non05eralco em-loyee who had +een -resent in 5eralco Aeld o-erations% does not contradict at all +,t rather s,--ort the 5eralco s,+mission that there had +een Ere-orted -ilferageE or Eram-ant theft%E +y the crew% of com-any -ro-erty even +efore 5ay (#% ($$!. The esta+lished fact that Llanes% a non05eralco em-loyee% was often seen d,ring com-any o-erations% conversing with the foremen% for reason or reasons connected with the ongoing com-any o-erations% gives rise to the 8,estion* what was he doing thereL &--arently% he had +een visiting 5eralco wor1sites% at least in the 4alenR,ela Sector% not sim-ly to socialiRe% +,t to do something else. &s testiAed to +y witnesses% he was -ic1ing ,- ,n,sed s,--lies and materials that were not ret,rned to the com-any. )rom these fact,al -remises% it is not hard to concl,de that this activity was for the m,t,al -ec,niary +eneAt of himself and the crew who tolerated the -ractice. )or one wor1ing at the scene who had seen or who had shown familiarity with Llanes ;a non05eralco em-loyee<% not to have 1nown the reason for his -resence is to disregard the o+vio,s% or at least the very s,s-icio,s. 2e consider% too% and we And credi+le the com-any s,+mission that the 5eralco crew who wor1ed at the /acheco S,+division in 4alenR,ela City on 5ay (#% ($$! had not +een ret,rning ,n,sed s,--lies and materials% to the -reC,dice of the com-any. )rom all these% the allegedly hearsay evidence that is not com-etent in C,dicial -roceedings ;as noted a+ove<% ta1es on s-ecial meaning and relevance. ?n the whole% the totality of the circ,mstances o+taining in the case convinces ,s that Gala co,ld not +,t have 1nowledge of the -ilferage of com-any electrical s,--lies on 5ay (#% ($$!D he was com-licit in its commission% if not +y direct -artici-ation% certainly% +y his inaction while it was +eing -er-etrated and +y not re-orting the incident to com-any a,thorities. Th,s% we And s,+stantial evidence to s,--ort the concl,sion that Gala does not deserve to remain in 5eralco6s em-loy as a reg,lar em-loyee. =e violated his -ro+ationary em-loyment agreement% es-ecially the re8,irement for him Eto o+serve at all times the highest degree of trans-arency% selTessness and integrity in the -erformance of their d,ties and res-onsi+ilitiesM.NE =e failed to 8,alify as a reg,lar em-loyee. Com-laint dismissed for lac1 of merit. ARO, ET. AL. vs. NLRC, ET. AL. G.R. No. P@P"(% 5&RC= P% ($( )&CTS* Several em-loyees of -rivate res-ondent Benthel Develo-ment Cor-oration% incl,ding the -etitioners% Aled a Com-laint for illegal dismissal with vario,s money claims and -rayer for damages against the res-ondent. L& fo,nd for the -rivate res-ondents% r,led illegal dismissal and ordered to -ay their se-aration -ay. NLRC a9rmed decision of the L& +,t with the modiAcation that -rivate res-ondent -ay +ac1wages com-,ted from the res-ective dates of dismissal ,ntil Anality of the decision. /rivate res-ondent% ,nsatisAed with the modiAcation made +y the NLRC% Aled a motion for reconsideration with the contention that% since it has +een fo,nd +y the La+or &r+iter and a9rmed in the assailed decision that the em-loyees were -roCect em-loyees% the com-,tation of +ac1wages sho,ld +e limited to the date of the com-letion of the -roCect and not to the Anality of the decision. The NLRC% however% denied the motion r,ling that -rivate res-ondent failed to esta+lish the date of the com-letion of the -roCect. C& denied -etition for certiorari and 5R. /rivate Res-ondent a--ealed to NLRC contending that the com-,tation for +ac1wages m,st +e only ,ntil the com-letion of the -roCect and not ,ntil the Anality of the decision. /,+lic res-ondent% in its Decision dated .,ne (#% ($$@% a9rmed the ?rder of La+or &r+iter Bant,g% +,t red,ced the total amo,nt to /@%$P:%'#'.$$% incl,sive of attorney6s fees. Thereafter -rivate res-ondent Aled another 5R which was denied +y -,+lic res-ondent% hence% -rivate res-ondent Aled a -etition for certiorari with the C&% alleging that -,+lic res-ondent committed grave a+,se of discretion in -rom,lgating its assailed decision and denying its motion for reconsideration. The C& granted the -etition% therefore% ann,lling and setting aside the decision and resol,tion of the NLRC as to the award for +ac1wages and remanded the case to the same -,+lic res-ondent for the -ro-er com-,tation of the +ac1wages d,e to each of the -etitioners herein. =ence the -resent -etition. 3SSUBS* 2hether or not em-loyees were -roCect em-loyees. @# F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch 2hether or not the com-,tation of their +ac1wages was to +e rec1oned from the time of their illegal dismissal ,- to the time of the Anality of C,dgment. SC RUL3NG* Co,rt Ands for -rivate res-ondent% denied -etitioners -etition for review and a9rming decision of C& dated 5arch P% ($$! and Resol,tion dated .,ly (P% ($$! in toto. Termination of -roCect em-loyees and their +ac1wages. &ccording to the C&% -etitioners are -roCect em-loyees as fo,nd +y La+or &r+iter Brnesto Carreon in his Decision dated 5ay ('% ""'% +eca,se they were hired for the constr,ction of the Cordova Reef 4illage Resort in Cordova% Ce+,% which was later on a9rmed +y the NLRC in its .an,ary (% """ decision. The only discre-ancy is the ?rder of the NLRC that -etitioners are entitled to +ac1wages ,- to the Anality of its decision% when as -roCect em-loyees% -rivate res-ondents are only entitled to -ayment of +ac1wages ,ntil the date of the com-letion of the -roCect. 3n a later resol,tion on -rivate res-ondent6s motion for reconsideration of its .an,ary (% """ decision% the NLRC changed its Andings +y r,ling that -etitioners herein were reg,lar em-loyees and% therefore% entitled to f,ll +ac1wages% ,ntil Anality of the decision% citing that -etitioners6 re-eated rehiring over a long s-an of time made them reg,lar em-loyees. This Co,rt agrees with the Andings of the C& that -etitioners were -roCect em-loyees. 3t is not dis-,ted that -etitioners were hired for the constr,ction of the Cordova Reef 4illage Resort in Cordova% Ce+,. By the nat,re of the contract alone% it is clear that -etitioners6 em-loyment was to carry o,t a s-eciAc -roCect. =ence% the C& did not commit grave a+,se of discretion when it a9rmed the Andings of the La+or &r+iter. The C& correctly r,led* & review of the facts and the evidence in this case readily shows that a Anding had +een made +y La+or &r+iter Brnesto Carreon% in his decision dated 5ay ('% ""'% that com-lainants% incl,ding -rivate res-ondents% are -roCect em-loyees. They were hired for the constr,ction of the Cordova Reef 4illage Resort in Cordova% Ce+,. 2e note that no a--eal had +een made +y the com-lainants% incl,ding herein -rivate res-ondents% from the said Anding. Th,s% that -rivate res-ondents are -roCect em-loyees has already +een eJectively esta+lished. Li1ewise% a review of the -,+lic res-ondent6s .an,ary (% """ decision shows that it a9rmed the la+or ar+iter6s Anding of the -rivate res-ondents6 +eing -roCect em-loyees. 2e therefore cannot fathom how the -,+lic res-ondent co,ld have ordered +ac1wages ,- to the Anality of its decision when% as -roCect em-loyees% -rivate res-ondents are only entitled to -ayment of the same ,ntil the date of the com-letion of the -roCect. 3t is settled that% witho,t a valid ca,se% the em-loyment of -roCect em-loyees cannot +e terminated -rior to e7-iration. ?therwise% they shall +e entitled to reinstatement with f,ll +ac1wages. =owever% if the -roCect or wor1 is com-leted d,ring the -endency of the ens,ing s,it for illegal dismissal% the em-loyees shall +e entitled only to f,ll +ac1wages from the date of the termination of their em-loyment ,ntil the act,al com-letion of the wor1. 2hile it may +e tr,e that in the -roceedings +elow the date of com-letion of the -roCect for which the -rivate res-ondents were hired had not +een clearly esta+lished% it constit,tes grave a+,se of discretion on the -art of the -,+lic res-ondent for not determining for itself the date of said com-letion instead of merely ordering -ayment of +ac1wages ,ntil Anality of its decision. 777 777 777 The decision of the la+or ar+iter% as a9rmed +y the -,+lic res-ondent in its .an,ary (% """ decision% clearly esta+lished that -rivate res-ondents were -roCect em-loyees. Beca,se there was no showing then that the -roCect for which their services were engaged had already +een com-leted% the -,+lic res-ondent li1ewise fo,nd that -rivate res-ondents were illegally dismissed and th,s entitled to +ac1wages. =owever% in ,tter disregard of the law and -revailing C,ris-r,dence% the -,+lic res-ondents ca-ricio,sly and ar+itrarily ordered that the said +ac1wages +e com-,ted ,ntil the Anality of its decision instead of only ,ntil the date of the -roCect com-letion. 3n grave a+,se of its discretion% the -,+lic res-ondent ref,sed to consider the evidence -resented +efore it as to the date of com-letion of the Cordova Reef 4illage Resort -roCect. The records show that a9davits have +een e7ec,ted +y the -etitioner6s manager% cor-orate architect and -roCect engineer as to the fact of the com-letion of the -roCect in ?cto+er ""!. &s these evidences were already a matter of record% the -,+lic res-ondent sho,ld not have closed its eyes and sho,ld have endeavored to render a correct and C,st C,dgment. 777 777 777 @! F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch ),rthermore% as earlier noted% -rivate res-ondents did not a--eal from the La+or &r+iter6s Andings that they were ind,+ita+ly -roCect em-loyees. =owever% they were entitled to the -ayment of se-aration -ay only for the reason that the date of the com-letion of the -roCect for which they were hired had not +een clearly esta+lished. Th,s% in a9rming the la+or ar+iter6s decision% the -,+lic res-ondent in eJect s,stained the Anding that -rivate res-ondents are -roCect em-loyees. The statement% therefore% contained in the resol,tion of the -etitioner6s motion for reconsideration of its .an,ary (% """ decision that re-eated rehiring ma1es the wor1er a reg,lar em-loyee% is at +est an o+iter% es-ecially considering that s,ch concl,sion had not +een shown to a--ly to the circ,mstances then o+taining with the -rivate res-ondents6 em-loyment with the -etitioner. Therefore% +eing -roCect em-loyees% -etitioners are only entitled to f,ll +ac1wages% com-,ted from the date of the termination of their em-loyment ,ntil the act,al com-letion of the wor1. 3llegally dismissed wor1ers are entitled to the -ayment of their salaries corres-onding to the ,ne7-ired -ortion of their em-loyment where the em-loyment is for a deAnite -eriod. 3n this case% as fo,nd +y the C&% the Cordova Reef 4illage Resort -roCect had +een com-leted in ?cto+er ""! and -rivate res-ondent herein had signiAed its willingness% +y way of concession to -etitioners% to set the date of com-letion of the -roCect as 5arch '% ""PD hence% the latter date sho,ld +e considered as the date of com-letion of the -roCect for -,r-oses of com-,ting the f,ll +ac1wages of -etitioners. YMBONG vs. ABS%CBN BROADCASTING CORP. G.R. No. '@''#% 5&RC= P% ($( )&CTS* /etitioner Brnesto G. Sm+ong started wor1ing for &BS0CBN Broadcasting Cor-oration ;&BS0CBN< in "": at its regional station in Ce+, as a television talent% co0anchoring =oy Gising and T4 /atrol Ce+,. =is stint in &BS0CBN later e7tended to radio when &BS0CBN Ce+, la,nched its &5 station DS&B in ""# where he wor1ed as drama and voice talent% s-inner% scri-twriter and -,+lic aJairs -rogram anchor. Li1e Sm+ong% Leandro /atalingh,g also wor1ed for &BS0CBN Ce+,. Starting ""#% he wor1ed as talent% director and scri-twriter for vario,s radio -rograms aired over DS&B. ?n .an,ary % ""!% the &BS0CBN =ead ?9ce in 5anila iss,ed /olicy No. =R0BR0$! or the E/olicy on Bm-loyees See1ing /,+lic ?9ce.E The -ertinent -ortions read* .&ny em-loyee who intends to r,n for any -,+lic o9ce -osition% m,st Ale his>her letter of resignation% at least thirty ;:$< days -rior to the o9cial Aling of the certiAcate of candidacy either for national or local election. 777 777 777 :.),rther% any em-loyee who intends to Coin a -olitical gro,->-arty or even with no -olitical a9liation +,t who intends to o-enly and aggressively cam-aign for a candidate or gro,- of candidates ;e.g.% -,+licly s-ea1ing>endorsing candidate% recr,iting cam-aign wor1ers% etc.< m,st Ale a re8,est for leave of a+sence s,+Cect to management6s a--roval. )or this -artic,lar reason% the em-loyee sho,ld Ale the leave re8,est at least thirty ;:$< days -rior to the start of the -lanned leave -eriod. Beca,se of the im-ending 5ay ""' elections and +ased on his immediate recollection of the -olicy at that time% Dante L,Ron% &ssistant Station 5anager of DS&B iss,ed the following memorand,m* T?*&LL C?NCBRNBD )R?5*D&NTB LUW?N D&TB*5&RC= (#% ""' SUB.BCT*&S ST&TBD /lease +e informed that -er com-any -olicy% any em-loyee>talent who wants to r,n for any -osition in the coming election will have to Ale a leave of a+sence the moment he>she Ales his>her certiAcate of candidacy. The services rendered +y the concerned em-loyee>talent to this com-any will then +e tem-orarily s,s-ended for the entire cam-aign>election -eriod. &fter the iss,ance of the 5arch (#% ""' 5emorand,m% Sm+ong got in to,ch with L,Ron. L,Ron claims that Sm+ong a--roached him and told him that he wo,ld leave radio for a co,-le of months +eca,se he will cam-aign for the administration tic1et. 3t was only after the elections that they fo,nd o,t that Sm+ong act,ally ran for -,+lic o9ce himself at the eleventh ho,r. Sm+ong% on the other hand% claims that in accordance with the 5arch (#% ""' 5emorand,m% he informed L,Ron thro,gh a letter that he wo,ld ta1e a few months leave of a+sence from 5arch '% ""' to 5ay '% ""' since he was r,nning for co,ncilor of La-,0La-, City. &s regards /atalingh,g% /atalingh,g a--roached L,Ron and advised him that he will r,n as co,ncilor for Naga% Ce+,. &ccording to L,Ron% he clariAed to /atalingh,g that he will +e considered resigned and not C,st on leave once he Ales a certiAcate of candidacy. Later% Sm+ong and /atalingh,g +oth tried to come +ac1 to &BS0CBN Ce+,. &ccording to L,Ron% he informed @P F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch them that they cannot wor1 there anymore +eca,se of com-any -olicy. &s a res,lt% they Aled as illegal dismissal s,it against &BS0CBN. 3SSUBS* ;< 2hether /olicy No. =R0BR0$! is validD ;(< 2hether the 5arch (#% ""' 5emorand,m iss,ed +y L,Ron s,-erseded /olicy No. =R0BR0$!D and ;:< 2hether Sm+ong% +y see1ing an elective -ost% is deemed to have resigned and not dismissed +y &BS0CBN. SC RUL3NGS* /olicy No. =R0BR0$! is valid. 2e have consistently held that so long as a com-any6s management -rerogatives are e7ercised in good faith for the advancement of the em-loyer6s interest and not for the -,r-ose of defeating or circ,mventing the rights of the em-loyees ,nder s-ecial laws or ,nder valid agreements% this Co,rt will ,-hold them. 3n the instant case% &BS0CBN validly C,stiAed the im-lementation of /olicy No. =R0BR0$!. 3t is well within its rights to ens,re that it maintains its o+Cectivity and credi+ility and freeing itself from any a--earance of im-artiality so that the conAdence of the viewing and listening -,+lic in it will not +e in any way eroded. Bven as the law is solicito,s of the welfare of the em-loyees% it m,st also -rotect the right of an em-loyer to e7ercise what are clearly management -rerogatives. The free will of management to cond,ct its own +,siness aJairs to achieve its -,r-ose cannot +e denied. /olicy No. =R0BR0$! was not s,-erseded +y the 5arch (#% ""' 5emorand,m The C& correctly r,led that tho,gh L,Ron% as &ssistant Station 5anager for Radio of &BS0CBN% has -olicy0ma1ing -owers in relation to his -rinci-al tas1 of administering the networ16s radio station in the Ce+, region% the e7ercise of s,ch -ower sho,ld +e in accord with the general r,les and reg,lations im-osed +y the &BS0CBN =ead ?9ce to its em-loyees. Clearly% the 5arch (#% ""' 5emorand,m iss,ed +y L,Ron which only re8,ires em-loyees to go on leave if they intend to r,n for any elective -osition is in a+sol,te contradiction with /olicy No. =R0BR0$! iss,ed +y the &BS0CBN =ead ?9ce in 5anila which re8,ires the resignation% not only the Aling of a leave of a+sence% of any em-loyee who intends to r,n for -,+lic o9ce. =aving +een iss,ed +eyond the sco-e of his a,thority% the 5arch (#% ""' 5emorand,m is therefore void and did not s,-ersede /olicy No.=R0BR0$!. Sm+ong is deemed resigned when he ran for co,ncilor. &s /olicy No. =R0BR0$! is the s,+sisting com-any -olicy and not L,Ron6s 5arch (#% ""' 5emorand,m% Sm+ong is deemed resigned when he ran for co,ncilor. Sm+ong6s overt act of r,nning for co,ncilor of La-,0La-, City is tantamo,nt to resignation on his -art. =e was se-arated from &BS0CBN not +eca,se he was dismissed +,t +eca,se he resigned. Since there was no termination to s-ea1 of% the re8,irement of d,e -rocess in dismissal cases cannot +e a--lied to Sm+ong. Th,s% &BS0CBN is not d,ty0+o,nd to as1 him to e7-lain why he did not tender his resignation +efore he ran for -,+lic o9ce as mandated +y the s,+Cect com-any -olicy. 3n addition% we do not s,+scri+e to Sm+ong6s claim that he was not in a -osition to 1now which of the two iss,ances was correct. Sm+ong most li1ely than not% is f,lly aware that the s,+sisting -olicy is /olicy No. =R0BR0 $! and not the 5arch (#% ""' 5emorand,m and it was for this reason that% as stated +y L,Ron in his Sworn Statement% he only told the latter that he will only cam-aign for the administration tic1et and not act,ally r,n for an elective -ost. BLUE SKY TRADING CO. vs. BLAS, ET. AL. G.R. No. "$#""% 5&RC= P% ($( )&CTS* /etitioner Bl,e S1y Trading Com-any% 3nc. ;Bl,e S1y< is a d,ly registered domestic cor-oration engaged in the im-ortation and sale of medical s,--lies and e8,i-ment. The res-ondents &rlene /. Blas ;&rlene< and .ose-h D. Silvano ;.ose-h< were reg,lar em-loyees of Bl,e S1y and they res-ectively held the -ositions of stoc1 cler1 and wareho,se hel-er +efore they were dismissed from service on )e+r,ary #% ($$#. &n incident occ,rred where si7 -airs of intensifying screens were missing. ?n )e+r,ary :% ($$#% .ean B. De La /aR ;.ean<% =,man Reso,rce De-artment =ead iss,ed notices to e7-lain>-reventive s,s-ension to &rlene% .ose-h% delivery -ersonnel .ayde Tano0an ;.ayde< and maintenance -ersonnel>driver 2ilfredo )asonilao ;2ilfredo<. The notices informed them that they were +eing acc,sed of gross dishonesty in connection with their alleged -artici-ation in and cons-iracy with other em-loyees in committing @' F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch theft against com-any -ro-erty% s-eciAcally relative to the loss of the si7 intensifying screens. ?n )e+r,ary #% ($$#% .ean iss,ed to &rlene% .ose-h% .ayde and 2ilfredo notices of dismissal for ca,se stating therein that evidence that they had cons-ired with each other to commit theft against com-any -ro-erty was too glaring to ignore. Bl,e S1y had lost its tr,st and conAdence on them and as an act of self0-reservation% their termination from service was in order. ?n )e+r,ary '% ($$#% &rlene% .ose-h% =elario% .ayde and 2ilfredo Aled with the National La+or Relations Commission ;NLRC< a com-laint for illegal dismissal and s,s-ension% ,nder-ayment of overtime -ay% and non0 -ayment of emergency cost of living allowance ;BC?L&<% with -rayers for reinstatement and -ayment of f,ll +ac1wages. 5eanwhile% an entra-ment o-eration was cond,cted +y the -olice d,ring which .ayde and =elario were ca,ght allegedly attem-ting to sell to an o-erative an ,ltraso,nd -ro+e worth aro,nd /@$$%$$$.$$ +elonging to Bl,e S1y. Tho,gh event,ally% .ayde and =elario e7ec,ted a9davits of desistance stating that their dismissal was for ca,se. The La+or &r+iter denied the claims of the res-ondents of illegal s,s-ension and dismissal since they failed in their d,ties to e7ercise ,tmost -rotection% care% or c,stody of res-ondent6s -ro-erty. =ence% their dismissal from the service is warranted.The Arst decision of the NLRC r,led that res-ondents were not holding -ositions of tr,st and m,st therefore +e reinstated and +e -aid their +ac1wages. Their second decision on the other hand reversed the -revio,s one which in t,rn reinstated the La+or &r+iterIs dismissal of the com-laint saying that res-ondents were holding -ositions of tr,st and that the loss of the com-anyIs -ro-erty are s,+stantially -roven. The C& on the other hand fo,nd merit on their claims% tho,gh fo,nd res-ondents to have -ositions of tr,st and conAdence% -etitioner in this case failed to s,9ciently esta+lish the charge against res-ondents which was the +asis for its loss of tr,st and conAdence that warranted their dismissal. 3SSUB* 2hether or not res-ondents Blas and Silvano committed a +reach of tr,st SC RUL3NG* The r,le is long and well settled that% in illegal dismissal cases li1e the one at +ench% the +,rden of -roof is ,-on the em-loyer to show that the em-loyee6s termination from service is for a C,st and valid ca,se. The em-loyer6s case s,cceeds or fails on the strength of its evidence and not on the wea1ness of that add,ced +y the em-loyee% in 1ee-ing with the -rinci-le that the scales of C,stice sho,ld +e tilted in favor of the latter in case of do,+t in the evidence -resented +y them. ?ften descri+ed as more than a mere scintilla% the 8,ant,m of -roof is s,+stantial evidence which is ,nderstood as s,ch relevant evidence as a reasona+le mind might acce-t as ade8,ate to s,--ort a concl,sion% even if other e8,ally reasona+le minds might conceiva+ly o-ine otherwise. )ail,re of the em-loyer to discharge the foregoing on,s wo,ld mean that the dismissal is not C,stiAed and therefore illegal. 2e And no error in the C&6s Andings that the -etitioners had not ade8,ately -roven +y s,+stantial evidence that &rlene and .ose-h indeed -artici-ated or coo-erated in the commission of theft relative to the si7 missing intensifying screens so as to C,stify the latter6s termination from em-loyment on the gro,nd of loss of tr,st and conAdence. 2e note that the -arties disagree as to what tas1s were act,ally and reg,larly -erformed +y &rlene and .ose-h. They are at odds as to the iss,e of whether or not &rlene and .ose-h had c,stody of the missing screens. 2e o+serve tho,gh that neither of the -arties -resented any doc,mentary evidence% s,ch as em-loyment contracts% to esta+lish their claims relative to the act,al nat,re of &rlene and .ose-h6s daily tas1s. The -etitioners also arg,e that if &rlene and .ose-h had not +een grossly negligent in the -erformance of their d,ties% Bl,e S1y wo,ld not have inc,rred the loss. 2e o+serve tho,gh that in the notices sent to &rlene and .ose-h% Arst charging them with theft% and later% informing them of their dismissal from service% gross negligence was not stated therein as a gro,nd. =ence% &rlene and .ose-h co,ld not have defended themselves against the charge of gross negligence. They cannot +e dismissed on that gro,nd lest d,e -rocess +e violated. ?ther 5atters* ;)or Disc,ssion /,r-oses< +mpropriety of the Pre%enti%e Suspension The -,r-ose of the s,s-ension is to -revent an em-loyee from ca,sing harm or inC,ry to his colleag,es and to the em-loyer. The ma7im,m -eriod of s,s-ension is :$ days% +eyond which the em-loyee sho,ld either +e reinstated or +e -aid wages and +eneAts d,e to him. @" F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch 2hile we do not agree with Bl,e S1y6s s,+se8,ent decision to terminate them from service% we And no im-ro-riety in its act of im-osing -reventive s,s-ension ,-on the res-ondents since the -eriod did not e7ceed the ma7im,m im-osed +y law and there was a valid -,r-ose for the same. 3n lie, of reinstatement% se-aration -ay 3f reinstatement -roves im-ractica+le% and hardly in the +est interest of the -arties% -erha-s d,e to the la-se of time since the em-loyee6s dismissal% or if the em-loyee decides not to +e reinstated% the latter sho,ld +e awarded se-aration -ay in lie, of reinstatement. 3n the case at +ar% &rlene and .ose-h were dismissed from service on )e+r,ary #% ($$#. 2e And that the la-se of more than seven years already renders their reinstatement im-ractica+le. ),rther% from the st,++orn stances of the -arties% to wit% the -etitioners6 insistence that dismissal was valid on one hand% and the res-ondents6 e7-ress -rayer for the -ayment of se-aration -ay on the other% we And that reinstatement wo,ld no longer +e in the +est interest of the contending -arties. Liaility of 'orporate ,-cers &s a general r,le% a cor-orate o9cer cannot +e held lia+le for acts done in his o9cial ca-acity +eca,se a cor-oration% +y legal Action% has a -ersonality se-arate and distinct from its o9cers% stoc1holders% and mem+ers. 3n illegal dismissal cases% cor-orate o9cers may only +e held solidarily lia+le with the cor-oration if the termination was done with malice or +ad faith. 2e And that the aforementioned circ,mstance did not o+tain in the case of .ose ;vice0-resident< and Linda ;secretary< relative to &rlene and .ose-h6s dismissal from service. INTERNATIONAL MANAGEMENT SERVICES vs. LOGARTA G.R. No. !:!#P% &/R3L '% ($( )&CTS* Recr,itment agency% 3nternational 5anagement Services ;35S<% owned and o-erated +y 5arilyn C. /asc,al% de-loyed res-ondent Roel /. Logarta to wor1 for /etrocon &ra+ia Limited ;/etrocon< in &l1ho+ar% Xingdom of Sa,di &ra+ia% in connection with general engineering services of /etrocon for the Sa,di &ra+ian ?il Com-any ;Sa,di &ramco<. Res-ondent was em-loyed for a -eriod of two ;(< years% commencing on ?cto+er (% ""P% with a monthly salary of eight h,ndred US Dollars ;US^'$$.$$<. ?n &-ril ("% ""'% Sa,di &ramco notiAed /etrocon that d,e to changes in the general engineering services wor1 forecast for ""'% the man0ho,rs that were formerly allotted to /etrocon is going to +e red,ced +y @$Q which constrained /etrocon to red,ce its -ersonnel. Th,s% on .,ne % ""'% /etrocon gave res-ondent a written notice informing the latter that d,e to the lac1 of -roCect wor1s related to his e7-ertise% he is given a :$0day notice of termination% and that his last day of wor1 with /etrocon will +e on .,ly % ""'. /etrocon also informed res-ondent that all d,e +eneAts in accordance with the terms and conditions of his em-loyment contract will +e -aid to res-ondent% incl,ding his tic1et +ac1 to the /hili--ines. Before his de-art,re from Sa,di &ra+ia% res-ondent received his Anal -aychec1 from /etrocon amo,nting SRP%@''.#P. U-on his ret,rn% res-ondent Aled a com-laint with the Regional &r+itration Branch 433% National La+or Relations Commission ;NLRC<% Ce+, City% against -etitioner as the recr,itment agency which em-loyed him for em-loyment a+road. 3n Aling the com-laint% res-ondent so,ght to recover his ,nearned salaries covering the ,ne7-ired -ortion of his em-loyment contract with /etrocon on the gro,nd that he was illegally dismissed. The La+or &r+iter rendered C,dgment in favor of the res-ondent and ordered -etitioner to -ay the -eso e8,ivalent of US^#%!$$.$$ +ased on the rate at the time of act,al -ayment% as -ayment of his wages for the ,ne7-ired -ortion of his contract of em-loyment. The NLRC on a--eal a9rmed the La+or &r+iterIs decision +,t red,ced the award to only US^@%'$$.$$ or its -eso e8,ivalent at the time of -ayment. The C& li1ewise dismissed the -etition and a9rmed the NLRC decision. 3SSUB* 2hether or not res-ondents dismissal thro,gh retrenchment illegal. SC RUL3NG* No Retrenchment is the red,ction of wor1 -ersonnel ,s,ally d,e to -oor Anancial ret,rns% aimed to c,t down costs for o-eration -artic,larly on salaries and wages. 3t is one of the economic gro,nds to dismiss em-loyees and is resorted +y an em-loyer -rimarily to avoid or minimiRe +,siness losses. #$ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch Retrenchment -rograms are -,rely +,siness decisions within the -,rview of a valid and reasona+le e7ercise of management -rerogative. 3t is one way of downsiRing an em-loyer6s wor1force and is often resorted to +y the em-loyer d,ring -eriods of +,siness recession% ind,strial de-ression% or seasonal T,ct,ations% and d,ring l,lls in -rod,ction occasioned +y lac1 of orders% shortage of materials% conversion of the -lant for a new -rod,ction -rogram% or introd,ction of new methods or more e9cient machinery or a,tomation. 3t is a valid management -rerogative% -rovided it is done in good faith and the em-loyer faithf,lly com-lies with the s,+stantive and -roced,ral re8,irements laid down +y law and C,ris-r,dence. /hili--ine Law recogniRes retrenchment as a valid ca,se for the dismissal of a migrant or overseas )ili-ino wor1er ,nder &rticle (': of the La+or Code. Th,s% retrenchment is a valid e7ercise of management -rerogative s,+Cect to the strict re8,irements set +y C,ris-r,dence% to wit* ;<That the retrenchment is reasona+ly necessary and li1ely to -revent +,siness losses which% if already inc,rred% are not merely de minimis% +,t s,+stantial% serio,s% act,al and real% or if only e7-ected% are reasona+ly imminent as -erceived o+Cectively and in good faith +y the em-loyerD ;(<That the em-loyer served written notice +oth to the em-loyees and to the De-artment of La+or and Bm-loyment at least one month -rior to the intended date of retrenchmentD ;:<That the em-loyer -ays the retrenched em-loyees se-aration -ay e8,ivalent to one month -ay or at least >( month -ay for every year of service% whichever is higherD ;@<That the em-loyer e7ercises its -rerogative to retrench em-loyees in good faith for the advancement of its interest and not to defeat or circ,mvent the em-loyees6 right to sec,rity of ten,reD and ;#<That the em-loyer ,sed fair and reasona+le criteria in ascertaining who wo,ld +e dismissed and who wo,ld +e retained among the em-loyees% s,ch as stat,s%_e9ciency% seniority% -hysical Atness% age% and Anancial hardshi- for certain wor1ers. &--lying the a+ove0stated re8,isites for a valid retrenchment in the case at +ar% it is a--arent that the Arst% fo,rth and Afth re8,irements were com-lied with +y res-ondent6s em-loyer. =owever% the second and third re8,isites were a+sent when /etrocon terminated the services of res-ondent. &s a-tly fo,nd +y the NLRC and C,stly s,stained +y the C&% /etrocon e7ercised its -rerogative to retrench its em-loyees in good faith and the considera+le red,ction of wor1 allotments of /etrocon +y Sa,di &ramco was s,9cient +asis for /etrocon to red,ce the n,m+er of its -ersonnel. &s for the notice re8,irement% however% contrary to -etitioner6s contention% -ro-er notice to the D?LB within :$ days -rior to the intended date of retrenchment is necessary and m,st +e com-lied with des-ite the fact that res-ondent is an overseas )ili-ino wor1er. 3n the -resent case% altho,gh res-ondent was d,ly notiAed of his termination +y /etrocon :$ days +efore its eJectivity% no allegation or -roof was advanced +y -etitioner to esta+lish that /etrocon ever sent a notice to the D?LB :$ days +efore the res-ondent was terminated. Th,s% this re8,irement of the law was not com-lied with. 3n the case at +ar% des-ite the fact that res-ondent was em-loyed +y /etrocon as an ?)2 in Sa,di &ra+ia% still +oth he and his em-loyer are s,+Cect to the -rovisions of the La+or Code when a--lica+le. The +asic -olicy in this C,risdiction is that all )ili-ino wor1ers% whether em-loyed locally or overseas% enCoy the -rotective mantle of /hili--ine la+or and social legislations. &lso% res-ondent is entitled to the -ayment of his se-aration -ay. =owever% this Co,rt disagrees with the concl,sion of the La+or &r+iter% the NLRC and the C&% that res-ondent sho,ld +e -aid his se-aration -ay in accordance with the -rovision of Section $ of R.&. No. '$@(. & -lain reading of the said -rovision clearly reveals that it a--lies only to an illegally dismissed overseas contract wor1er or a wor1er dismissed from overseas em-loyment witho,t C,st% valid or a,thoriRed ca,se. 3n the case at +ar% notwithstanding the fact that res-ondent6s termination from his em-loyment was -roced,rally inArm% having not com-lied with the notice re8,irement% nevertheless the same remains to +e for a C,st% valid and a,thoriRed ca,se% i.e.% retrenchment as a valid e7ercise of management -rerogative. To stress% des-ite the em-loyer6s fail,re to com-ly with the one0month notice to the D?LB -rior to res-ondent6s termination% it is only a -roced,ral inArmity which does not render the retrenchment illegal. 3n &ga+on v. NLRC% this Co,rt r,led that when the dismissal is for a C,st ca,se% the a+sence of -ro-er notice sho,ld not n,llify the dismissal or render it illegal or ineJect,al. 3nstead% the em-loyer sho,ld indemnify the em-loyee for violation of his stat,tory rights. # F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch Conse8,ently% it is &rticle (': of the La+or Code and not Section $ of R.&. No. '$@( that is controlling. Th,s% res-ondent is entitled to -ayment of se-aration -ay e8,ivalent to one ;< month -ay% or at least one0half ;>(< month -ay for every year of service% whichever is higher. Considering that res-ondent was em-loyed +y /etrocon for a -eriod of eight ;'< months% he is entitled to receive one ;< month -ay as se-aration -ay. 3n addition% -,rs,ant to c,rrent C,ris-r,dence% for fail,re to f,lly com-ly with the stat,tory d,e -rocess of s,9cient notice% res-ondent is entitled to nominal damages in the amo,nt /#$%$$$.$$. IAO, ET. AL. vs. NLRC G.R. No. '(::% &/R3L '% ($( )&CTS* The -etitioners were reg,lar em-loyees of the /hili--ine Ban1ing Cor-oration ;/hil+an1<% each with at least ten years of service in the com-any. /,rs,ant to its 5emorand,m dated &,g,st ('% "P$% /hil+an1 esta+lished a Grat,ity /ay /lan ;?ld /lan< for its em-loyees. The ?ld /lan -rovided* Any employee who has reached the compulsory retirement age of ./ years0 or who wishes to retire or resign prior to the attainment of such age or who is separated from ser%ice y reason of death0 sickness or other causes eyond his1her control shall for himself or thru his1her heirs 2le with the personnel o-ce an application for the payment of ene2ts under the plan! ?n 5arch '% ""% /hil+an1 im-lemented a new Grat,ity /ay /lan ;New Grat,ity /lan<. 3n -artic,lar% the New Grat,ity /lan stated th,s* 7 7 7 &n Bm-loyee who is invol,ntarily se-arated from the service +y reason of death% sic1ness or -hysical disa+ility% or for any a,thoriRed ca,se ,nder the law s,ch as red,ndancy% or other ca,ses not d,e to his own fa,lt% miscond,ct or vol,ntary resignation% shall +e entitled to either one h,ndred -ercent ;$$Q< of his accr,ed grat,ity +eneAt or the act,al +eneAt d,e him ,nder the /lan% whichever is greater. 3n )e+r,ary ($$$% /hil+an1 merged with Glo+al B,siness Ban1% 3nc. ;Glo+al+an1<% with the former as the s,rviving cor-oration and the latter as the a+sor+ed cor-oration% +,t the +an1 o-erated ,nder the name Glo+al B,siness Ban1% 3nc. &s a res,lt of the merger% com-lainantsI res-ective -ositions +ecame red,ndant. & S-ecial Se-aration /rogram ;SS/< was im-lemented and the -etitioners were granted a se-aration -ac1age e8,ivalent to one and a half monthIs -ay ;or #$Q of one monthIs salary< for every year of service +ased on their c,rrent salary. Before the -etitioners co,ld avail of this -rogram% they were re8,ired to sign two doc,ments% namely% an &cce-tance Letter and a Release% 2aiver% Y,itclaim ;8,itclaim<. &s their -ositions were incl,ded in the red,ndancy declaration% the -etitioners availed of the SS/% signed acce-tance letters and e7ec,ted 8,itclaims in Glo+al+an1Is favor in consideration of their recei-t of se-aration -ay e8,ivalent to #$Q of their monthly salaries for every year of service. S,+se8,ently% the -etitioners Aled se-arate com-laints for non0-ayment of se-aration -ay with -rayer for damages and attorneyIs fees +efore the National La+or Relations Commission ;NLRC<. The -etitioners asserted that% ,nder the ?ld /lan% they were entitled to an additional #$Q of their grat,ity -ay on to- of #$Q of one monthIs salary for every year of service they had already received. They insisted that $$Q of the #$Q rightf,lly +elongs to them as their se-aration -ay. Th,s% the remaining #$Q was only half of the grat,ity -ay that they are entitled to ,nder the ?ld /lan. The -etitioners f,rther arg,ed that the 8,itclaims they signed sho,ld not +ar them from claiming their f,ll entitlement ,nder the law. They also claimed that they were defra,ded into signing the same witho,t f,ll 1nowledge of its legal im-lications. 3SSUBS* The -etitioners are now +efore this Co,rt raising the following errors s,--osedly committed +y the C&* a. 3n holding that Kthe +an1 had a+andoned the old -lanO ;referring to the old Grat,ity /ay /lan< and re-laced it with a S-ecial Se-aration /rogram ,nder which the -etitioners Kwo,ld +e receiving more than the rate in the old -lan and higher than the legal rate for red,ndant em-loyees. +. 3n holding that the +eneAts ,nder the S-ecial Se-aration /rogram legally re-laced not only the grat,ity -ay -lan to which the -etitioners were entitled ,nder the old and new Grat,ity /ay /lans +,t also all other +eneAts incl,ding se-aration -ay ,nder the law. c. 3n not holding that when MtheN -etitioners were se-arated d,e to red,ndancy they were entitled -er -rovision of &rticle (': of the La+or Code to se-aration -ay e8,ivalent to one month -ay for every year of service. #( F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch d. 3n holding that the -etitioners are +o,nd ,nder the &cce-tance and Release% 2aiver and Y,itclaim that they had e7ec,ted and McannotN 8,estion the same% hence they cannot claim +eneAts in addition to those they had received from the +an1. SC RUL3NG* The -etitionersI recei-t of se-aration -ay e8,ivalent to their one and a half months salary for every year of service as -rovided in the SS/ and the New Grat,ity /lan more than s,9ciently com-lies with the La+or Code% which only re8,ires the -ayment of se-aration -ay at the rate of one month salary for every year of service. Glo+al+an1Is right to re-lace the ?ld /lan and the New Grat,ity /lan is within legal +o,nds as the terms thereof are in accordance with the -rovisions of the La+or Code and com-lies with the minim,m re8,irements thereof. Contrary to the -etitionersI claim% they had no vested right over the +eneAts ,nder the ?ld /lan considering that none of the events contem-lated there,nder occ,rred -rior to the re-eal thereof +y the ado-tion of the New Grat,ity /lan. S,ch right accr,es only ,-on their se-aration from service for ca,ses contem-lated ,nder the ?ld /lan and the -etitioners can only avail the +eneAts ,nder the -lan that is eJective at the time of their dismissal. 3n this case% when the merger and the red,ndancy -rogram were im-lemented% what was in eJect were the New Grat,ity /lan and the SS/D the -etitioners cannot% th,s% insist on the -rovisions of the ?ld /lan which is no longer e7istent. The SS/ did not revo1e or s,-ersede the New Grat,ity /lan. The SS/ was not intended to s,-ersede the New Grat,ity /lan. ?n the contrary% the SS/ was iss,ed to ma1e the +eneAts ,nder the New Grat,ity /lan availa+le to em-loyees whose -ositions had +ecome red,ndant +eca,se of the merger +etween /hil+an1 and Glo+al+an1% s,+Cect to com-liance with certain re8,irements s,ch as age and length of service% and to im-rove s,ch +eneAts +y increasing or ro,nding it ,- to an amo,nt e8,ivalent to the aJected em-loyeesI one and a half monthly salary for every year of service. 3n other words% the +eneAts to which the red,ndated em-loyees are entitled to% incl,ding the -etitioners% are the +eneAts ,nder the New Grat,ity /lan% al+eit increased +y the SS/. Considering that the New Grat,ity /lan still stands and has not +een revo1ed +y the SS/% does this mean that the -etitioners can claim the +eneAts there,nder in addition to or on to- of what is re8,ired ,nder the &rticle (': of the La+or CodeL )or as long as the minim,m re8,irements of the La+or Code are met% it is within the management -rerogatives of em-loyers to come ,- with se-aration -ac1ages that will +e given in lie, of what is -rovided ,nder the La+or Code. &rticle (': of the La+or Code -rovides only the re8,ired minim,m amo,nt of se-aration -ay% which em-loyees dismissed for any of the a,thoriRed ca,ses are entitled to receive. Bm-loyers% therefore% have the right to create -lans% -roviding for se-aration -ay in an amo,nt over and a+ove what is im-osed +y &rticle (':. There is nothing therein that -rohi+its em-loyers and em-loyees from contracting on the terms of em-loyment% or from entering into agreements on em-loyee +eneAts% so long as they do not violate the La+or Code or any other law% and are not contrary to morals% good c,stoms% -,+lic order% or -,+lic -olicy. 3n the a+sence of -roof that any of the vices of consent are -resent% the -etitionersI acce-tance letters and 8,itclaims are validD th,s% +arring them from claiming additional se-aration -ay. The Co,rt% in other cases% has ,-held 8,itclaims if fo,nd to com-ly with the following re8,isites* ;< the em-loyee e7ec,tes a deed of 8,itclaim vol,ntarilyD ;(< there is no fra,d or deceit on the -art of any of the -artiesD ;:< the consideration of the 8,itclaim is credi+le and reasona+leD and ;@< the contract is not contrary to law% -,+lic order% -,+lic -olicy% morals or good c,stoms or -reC,dicial to a third -erson with a right recogniRed +y law. 2e hold that 5etro+an1 cannot +e held lia+le for the -etitionersI claims. 2=BRB)?RB% the foregoing -remises considered% the -etition is DBN3BD. REALDA vs. NEW AGE GRAPHICS INC. G.R. No. "("$% &/R3L (#% ($( )&CTS* /etitioner Realda was dismissed +y Res-ondent New &ge Gra-hics 3nc. for ,nC,stiAed ref,sal to render overtime wor1% ,ne7-lained fail,re to o+serve -rescri+ed wor1 standards% ha+it,al tardiness and chronic a+senteeism des-ite warning and non0com-liance with the directive for him to e7-lain his n,mero,s ,na,thoriRed a+sences. The Co,rt of &--eals recogniRed the e7istence of C,st ca,ses for -etitionerIs dismissal% however% the a--ellate co,rt fo,nd that the res-ondent failed to o+serve the -roced,ral #: F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch re8,irements of d,e -rocess and% as a conse8,ence% awarded the -etitioner /#%$$$.$$ as Nominal Damages. 3SSUBS* 2hether or not the dismissal +ased on the gro,nds cited constit,ted C,st ca,sesD and 2hether or not the amo,nt awarded as Nominal Damages of /#%$$$.$$ was valid SC RUL3NG* )irst% the -etitionerIs ar+itrary deAance to Gra-hics% 3nc.Is order for him to render overtime wor1 constit,tes willf,l diso+edience. Ta1ing this in conC,nction with his inclination to a+sent himself and to re-ort late for wor1 des-ite +eing -revio,sly -enaliRed% the C& correctly r,led that the -etitioner is indeed ,tterly deAant of the lawf,l orders and the reasona+le wor1 standards -rescri+ed +y his em-loyer. Second% the -etitionerIs fail,re to o+serve Gra-hics% 3nc.Is wor1 standards constit,tes ine9ciency that is a valid ca,se for dismissal. )ail,re to o+serve -rescri+ed standards of wor1% or to f,lAll reasona+le wor1 assignments d,e to ine9ciency may constit,te C,st ca,se for dismissal. S,ch ine9ciency is ,nderstood to mean fail,re to attain wor1 goals or wor1 8,otas% either +y failing to com-lete the same within the alloted reasona+le -eriod% or +y -rod,cing ,nsatisfactory res,lts. &s the o-erator of Gra-hics% 3nc.Is -rinter% he is mandated to chec1 whether the colors that wo,ld +e -rinted are in accordance with the clientIs s-eciAcations and for him to do so% he m,st cons,lt the General 5anager and the color g,ide ,sed +y Gra-hics% 3nc. +efore ma1ing a f,ll r,n. Unfort,nately% he failed to o+serve this sim-le -roced,re and -roceeded to -rint witho,t ma1ing s,re that the colors were at -ar with the clientIs demands. This res,lted to delays in the delivery of o,t-,t% client dissatisfaction% and additional costs on Gra-hics% 3nc.Is -art. 2hile a -enalty in the form of s,s-ension had already +een im-osed on the -etitioner for his ha+it,al tardiness and re-eated a+senteeism% the -rinci-le of Ktotality of infractionsO sanctions the act of Gra-hics% 3nc. of considering s,ch -revio,s infractions in decreeing dismissal as the -ro-er -enalty for his tardiness and ,na,thoriRed a+sences inc,rred afterwards% in addition to his ref,sal to render overtime wor1 and conform to the -rescri+ed wor1 standards. This Co,rt cannot li1ewise agree to the -etitionerIs attem-t to +r,sh aside his ref,sal to render overtime wor1 as inconse8,ential when Gra-hics% 3nc.Is order for him to do so is C,stiAed +y Gra-hics% 3nc.Is contract,al commitments to its clients. S,ch an order is legal ,nder &rticle '" of the La+or Code and the -etitionerIs ,ne7-lained ref,sal to o+ey is ins,+ordination that merits dismissal from service. Nonetheless% while the C& Anding that the -etitioner is entitled to nominal damages as his right to -roced,ral d,e -rocess was not res-ected des-ite the -resence of C,st ca,ses for his dismissal is a9rmed% this Co,rt Ands the C& to have erred in A7ing the amo,nt that the Com-any is lia+le to -ay. The C& sho,ld have ta1en cogniRance of the n,mero,s cases decided +y this Co,rt where the amo,nt of nominal damages was A7ed at /:$%$$$.$$ if the dismissal was for a C,st ca,se. 2=BRB)?RB% -remises considered% the -etition is DBN3BD. The Decision of the Co,rt of &--eals in C&0G.R. S/ No. $!"(' is &))3R5BD with 5?D3)3C&T3?N in that res-ondent New &ge Gra-hics% 3nc. is here+y ordered to -ay -etitioner Billy 5. Realda nominal damages in the amo,nt of Thirty Tho,sand /esos ;/:$%$$$.$$<. KAKAMPI AND ITS MEMBERS, VICTOR PANUELOS, ET. AL. vs. KINGSPOINT E'PRESS G.R. No. "@':. &/R3L (#% ($(. )&CTS* 4ictor /aV,elos ;/aV,elos<% Bo++y Dacara ;Dacara<% &lson DiRon ;DiRon<% Saldy Dima+ayao ;Dima+ayao<% )ernando L,-angco% .r. ;L,-angco<% Sandy /aRi ;/aRi<% Camilo Ta+arangao% .r. ;Ta+arangao<% Bd,ardo =iRole ;=iRole< and Reginald Carillo ;Carillo< were the former drivers of Xings-oint B7-ress and Logistic ;Xings-oint B7-ress<% a sole -ro-rietorshi- registered in the name of 5ary &nn Co ;Co< and engaged in the +,siness of trans-ort of goods. ?n .an,ary !% ($$!% Xings-oint B7-ress iss,ed se-arate notices to individ,al -etitioners ,niformly stating that they have +een charged with dishonesty% serio,s miscond,ct% loss of conAdence% and acts inimical to the com-any% +y Aling with the NLRC false% malicio,s% and fa+ricated cases against the com-any. 3n addition% Xings-oint stated that the -etitionersI ref,sal to ,ndergo dr,g testing is ,nwarranted and against com-any -olicy. The -etitioners were given @' hrs ;( days< to s,+mit their answers and e7-lanation to the charges. #@ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch The individ,al -etitioners failed to s,+mit their written e7-lanation within the stated -eriod. S,+se8,ently% Xings-oint B7-ress iss,ed to them se-arate yet ,niformly worded notices informing them of their dismissal. The charges were allegedly +ased on these acts* )&BR3C&T3?N ?) B&SBLBSS 5?NBS CL&35S against the com-anyD 53SLB&D3NG )BLL?2 C?02?RXBRS to sign the 5&L3C3?US C?5/L&3NT )?R 5?NBS CL&35S against the com-anyD RB)US&L T? UNDBRG? T=B C?5/&NSIS GBNBR&L DRUG TBST B\T?RT3NG 5?NBS )R?5 C?02?RXBRS T? )UND &CT343T3BS T=&T T=BS 2BRB NB4BR )ULLS 3N)?R5BD ?). & com-laint for illegal dismissal was s,+se8,ently Aled +y -etitioners% alleging that the charges against them were fa+ricated and that their dismissal was -rom-ted +y Xings-oint B7-ressI aversion to their ,nion activities. The La+or &r+iter fo,nd Dacara% L,-angco% /aRi% Ta+arangao% =iRole and Carillo illegally dismissed. ?n the other hand% the com-laint was dismissed insofar as /an,elos% DiRon and Dima+ayao are concerned as they were deemed not to have Aled their -osition -a-ers. 2hile the allegation of anti0,nionism as the -rimordial motivation for the dismissal is considered ,nfo,nded% the res-ondents failed to -rove that the dismissal was for a C,st ca,se. ?n a--eal% the NLRC a9rmed the La+or &r+iterIs Decision. 3n addition% the NLRC r,led that the res-ondents failed to com-ly with the -roced,ral re8,irements of d,e -rocess considering that the ,niformly worded Arst notice sent +y Xings-oint to the -etitioners% did not a--rise them of the -artic,lar acts or omission for which their dismissal were so,ght. Res-ondents moved for reconsideration and the NLRC reversed itself and declared the individ,al -etitioners legally dismissed. S,+se8,ently% the -etitioners Aled a -etition for certiorari with the C&. The C& reversed and set aside the NLRC Decision. Res-ondents -rom-tly Aled a motion for reconsideration. Similar to the NLRC% the C& reversed itself and retracted its earlier Anding that the individ,al -etitioners were illegally dismissed. The C& concl,ded that the ( notices iss,ed +y Xings-oint B7-ress com-lied with the re8,irements of the law. 3SSUB* 2hether or not the individ,al -etitionersI dismissal is valid. SC RUL3NG* Ses% the -etitioners were legally dismissed. 3t is f,ndamental that in order to validly dismiss an em-loyee% the em-loyer is re8,ired to o+serve +oth s,+stantive and -roced,ral d,e -rocess the termination of em-loyment m,st +e +ased on a C,st or a,thoriRed ca,se and the dismissal m,st +e eJected after d,e notice and hearing. The Co,rt agreed with the C& that the -etitionersI ref,sal to s,+mit themselves to dr,g test is a C,st ca,se for their dismissal. &n em-loyer may terminate an em-loyment on the gro,nd of serio,s miscond,ct or willf,l diso+edience +y the em-loyee of the lawf,l orders of his em-loyer or re-resentative in connection with his wor1. 2illf,l diso+edience re8,ires the conc,rrence of two elements* ;< the em-loyee6s assailed cond,ct m,st have +een willf,l% that is% characteriRed +y a wrongf,l and -erverse attit,deD and ;(< the order violated m,st have +een reasona+le% lawf,l% made 1nown to the em-loyee% and m,st -ertain to the d,ties which he had +een engaged to discharge. Both elements are -resent in this case. &t no -oint did the dismissed em-loyees deny Xings-oint B7-ressI claim that they ref,sed to com-ly with the directive for them to s,+mit to a dr,g test or% at the very least% e7-lain their ref,sal. Th,s% this gives rise to the im-ression that their non0com-liance is deli+erate. The ,tter lac1 of reason or C,stiAcation for their ins,+ordination indicates that it was -rom-ted +y mere o+stinacy% hence% willf,l and warranting of dismissal. Drivers are indis-ensa+le to Xings-oint B7-ressI -rimary +,siness of rendering door0to0 door delivery services. 3t is common 1nowledge that the ,se of dangero,s dr,gs has adverse eJects on driving a+ilities that may render the dismissed em-loyees inca-a+le of -erforming their d,ties to Xings-oint B7-ress and acting against its interests% in addition to the threat they -ose to the -,+lic. Nonetheless% while Xings-oint B7-ress had reason to sever their em-loyment relations% the Co,rt fo,nd its s,--osed o+servance of the re8,irements of -roced,ral d,e -rocess -retentio,s. 2hile Xings-oint B7-ress re8,ired the dismissed em-loyees to e7-lain their ref,sal to s,+mit to a dr,g test% the ( days aJorded to them to do so cannot 8,alify as Kreasona+le o--ort,nityO% which the Co,rt constr,ed in Xing of Xings Trans-ort% 3nc. v. 5amac as a -eriod of at least # calendar days from recei-t of the notice. Th,s% even if Xings-oint B7-ressI defective attem-t to com-ly with -roced,ral d,e -rocess does not negate the e7istence of a C,st ca,se for their dismissal% it was held that Xings-oint B7-ress is still lia+le to indemnify the dismissed em-loyees. ## F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch EVER ELECTRICAL V. SAMAHANG MANGGAGAWA NG EVER ELECTRICAL G.R. N?. "@P"#% .UNB :% ($( )&CTS* Bver Blectrical 5an,fact,ring% 3nc. ;BB53< is a cor-oration engaged in the +,siness of man,fact,ring electrical -arts and s,--lies. The res-ondents are mem+ers of Samahang 5anggagawa ng Bver Blectrical>N&5&2U Local ((@. The controversy started when BB53 closed its +,siness o-erations res,lting in the termination of the services of its em-loyees. Res-ondents Aled a com-laint for illegal dismissal. They alleged that the clos,re was made witho,t any warning% notice or memorand,m and in f,ll disregard of the re8,irements of the La+or Code. BB53% in its defense% e7-lained that it had closed the +,siness d,e to vario,s factors. 3t alleged that it inc,rred serio,s losses when ?rient Ban1% one of the com-anies that it invested% s,Jered losses +eca,se of the then -revailing asian crisis. 3t also o+tained a loan from UC/B which it failed to -ay and as a conse8,ence UC/B Aled an ,nlawf,l detainer case against BB53. The 5eTC r,led in favor of UC/B and a writ of e7ec,tion was iss,ed as a res,lt BB53Is em-loyees were -revented from entering the com-anyIs factory. The L& r,led in favor of the em-loyees. U-on a--eal% the NLRC reversed the decision of the L&. 2hen it reached the C&% it reinstated the r,ling of the L&. The C& held that res-ondents were entitled to se-aration -ay and :th month -ay +eca,se the clos,re of BB53Is +,siness o-eration was eJected +y the enforcement of a writ of e7ec,tion and not +y reason of +,siness losses. =ence this -etition. 3SSUB* 2hether the clos,re was validly carried o,t as a res,lt of +,siness losses. =BLD* N?% the clos,re was not validly carried o,t. &rticle (': of the La+or Code identiAes clos,re or cessation of o-eration of the esta+lishment as an a,thoriRed ca,se for terminating an em-loyee. Similarly% the said -rovision mandates that em-loyees who are laid oJ from wor1 d,e to clos,res that are not d,e to +,siness insolvency sho,ld +e -aid se-aration -ay e8,ivalent to one0month -ay or to at least one0half month -ay for every year of service% whichever is higher. & fraction of at least si7 months shall +e considered one whole year. <ho,gh +,siness reverses or losses are recogniRed +y law as an a,thoriRed ca,se% it is still essential that the alleged losses in the +,siness o-erations +e -roven convincinglyD otherwise% this gro,nd for termination of em-loyment wo,ld +e s,sce-ti+le to a+,se +y conniving em-loyers% who might +e merely feigning +,siness losses or reverses in their +,siness vent,res in order to ease o,t em-loyees. 3n this case% BB53 failed to esta+lish that the main reason for its clos,re was +,siness reverses. &s a-tly o+served +y the C&% the cessation of BB53Is +,siness was not directly +ro,ght a+o,t +y serio,s +,siness losses or Anancial reverses% +,t +y reason of the enforcement of a C,dgment against it. Th,s% BB53 sho,ld +e re8,ired to -ay se-aration -ay to its aJected em-loyees. 3ts -resident cannot +e held solidarily lia+le +eca,se of lac1 of malice or +ad faith on his -art. WATERFRONT CEBU CITY HOTEL, VS. MA. MELANIE P. IMENE& et al. .UNB :% ($( )&CTS* The res-ondents were laid oJ as a res,lt of the s,s-ension of the Cl,+Is o-eration. Under &rt. ('! of the La+or Code% a +ona Ade s,s-ension of +,siness o-erations for not more than si7 ;!< months does not terminate em-loyment. &fter si7 ;!< months% the em-loyee may +e recalled to wor1 or +e -ermanently laid oJ. 3n this case% more than si7 ;!< months have ela-sed from the time the Cl,+ ceased to o-erate. =ence% res-ondentsI termination +ecame -ermanent. /etitioner anchors its arg,ments mainly on the thesis that retrenchment to -revent losses was ,nderta1en to C,stify the dismissal of res-ondents. /etitioner li1ened the clos,re of the Cl,+% which it deemed as a division>de-artment% to retrenchment. &cting on the same -remise that the Cl,+ is a division of -etitioner% res-ondents demanded that they sho,ld +e transferred to another de-artment of -etitioner% instead of +eing dismissed from em-loyment. Res-ondents also claim that -etitioner failed to -rove losses to s,--ort retrenchment. &t the o,tset% it sho,ld +e stated that the res-ondents cannot +e accommodated in other de-artments of the =otel. #! F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch The d,ties and f,nctions they -erform are -ec,liar to the -ositions they hold in the Cl,+. 3t is li1ewise ,ndis-,ted that the Cl,+ remained closed and there is no other de-artment in the =otel similar to the Cl,+ and which catered to foreign high sta1es gam+lers. 4erily% reinstatement cannot +e and co,ld not have +een an o-tion for -etitioner =otel. La+or &r+iter Brnesto ). Carreon r,led in favor of -etitioner and ,-held the clos,re of the Cl,+Is +,siness o-erations as a management -rerogative. =owever% the -etitioner was directed to com-ly with &rticle (': of the La+or Code and to -ay com-lainants their se-aration -ay e8,ivalent to one0half month -ay for every year of service% a fraction of at least ! months +eing considered as one year. Res-ondents a--ealed to the NLRC which iss,ed a Decision a9rming the r,ling of the La+or &r+iter. The NLRC o+served that -etitioner was a+le to s,+stantiate the losses s,Jered +y the Cl,+ thro,gh Anancial statements -ro-erly a,dited +y an inde-endent a,ditor. &fter the denial of res-ondentsI motion for reconsideration% they elevated the case to the Co,rt of &--eals. The Co,rt of &--eals rendered a Decision reversing the Andings and concl,sions of the NLRC. =ence% this -etition for review on certiorari. =BLD* 2aterfront /romotion% Ltd. is a wholly0owned s,+sidiary of 2aterfront /hili--ines. /etitioner =otel% as shown in the o9cial records% is also another s,+sidiary of 2aterfront /hili--ines. & review of the consolidated Anancial statement shows that for the Ascal years ($$( and ($$:% the -arent com-any and the consolidated com-anies reTect the same amo,nts of losses* United States ;U.S.< ^(%P"%$@.$$ for ($$( and U.S. ^P!#%(((.$$ for ($$:. This -roves -etitionerIs assertion that the losses there reTected refer to the losses of the Cl,+. The consolidated Anancial statement and the cor-orate relationshi-s it indicates% cannot% however% +e relied ,-on +y -etitioner to avoid this -artic,lar la+or dis-,te +eca,se% as already stated% -etitioner itself has +een claiming from the very +eginning that the Cl,+ is only a division>de-artment of the hotel. 4erily% retrenchment and not clos,re was eJected to warrant the valid dismissal of res-ondents. /etitioner has not totally ceased its o-erations. 3t merely closed down a de-artment. Retrenchment is the termination of em-loyment initiated +y the em-loyer thro,gh no fa,lt of and witho,t -reC,dice to the em-loyees. 3t is resorted to d,ring -eriods of +,siness recession% ind,strial de-ression% or seasonal T,ct,ations or d,ring l,lls occasioned +y lac1 of orders% shortage of materials% conversion of the -lant for a new -rod,ction -rogram or the introd,ction of new methods or more e9cient machinery or of a,tomation. 3t is an act of the em-loyer of dismissing em-loyees +eca,se of losses in the o-eration of a +,siness% lac1 of wor1% and considera+le red,ction on the vol,me of his +,siness. 3n case of retrenchment% -roof of Anancial losses +ecomes the determining factor in -roving its legitimacy. 3n esta+lishing a ,nilateral claim of act,al or -otential losses% Anancial statements a,dited +y inde-endent e7ternal a,ditors constit,te the normal method of -roof of -roAt and loss -erformance of a com-any. The condition of +,siness losses C,stifying retrenchment is normally shown +y a,dited Anancial doc,ments li1e yearly +alance sheets and -roAt and loss statements as well as ann,al income ta7 ret,rns. Retrenchment is s,+Cect to faithf,l com-liance with the s,+stantative and -roced,ral re8,irements laid down +y law and C,ris-r,dence. )or a valid retrenchment% the following elements m,st +e -resent* . That retrenchment is reasona+ly necessary and li1ely to -revent +,siness losses which% if already inc,rred% are not merely de minimis% +,t s,+stantial% serio,s% act,al and real% or if only e7-ected% are reasona+ly imminent as -erceived o+Cectively and in good faith +y the em-loyerD (. That the em-loyer served written notice +oth to the em-loyees and to the De-artment of La+or and Bm-loyment at least one month -rior to the intended date of retrenchmentD :. That the em-loyer -ays the retrenched em-loyees se-aration -ay e8,ivalent to one ;< month -ay or at least ` month -ay for every year of service% whichever is higherD @. That the em-loyer e7ercises its -rerogative to retrench em-loyees in good faith for the advancement of its interest and not to defeat or circ,mvent the em-loyeesI right to sec,rity of ten,reD and #P F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch #. That the em-loyer ,sed fair and reasona+le criteria in ascertaining who wo,ld +e dismissed and who wo,ld +e retained among the em-loyees% s,ch as stat,s% e9ciency% seniority% -hysical Atness% age% and Anancial hardshi- for certain wor1ers. &ll these elements were s,ccessf,lly -roven +y -etitioner. )irst% the h,ge losses s,Jered +y the Cl,+ for the -ast two years had forced -etitioner to close it down to avert f,rther losses which wo,ld event,ally aJect the o-erations of -etitioner. Second% all @# em-loyees wor1ing ,nder the Cl,+ were served with notice of termination. The corres-onding notice was li1ewise served to the D?LB one month -rior to retrenchment. Third% the em-loyees were oJered se-aration -ay% most of whom have acce-ted and o-ted not to Coin in this com-laint. )o,rth% cessation of or withdrawal from +,siness o-erations was +ona Ade in character and not im-elled +y a motive to defeat or circ,mvent the ten,rial rights of em-loyees. &s a matter of fact% as of this writing% the Cl,+ has not res,med o-erations. Neither is there a showing that -etitioner carried o,t the clos,re of the +,siness in +ad faith. No la+or dis-,te e7isted +etween management and the em-loyees when the latter were terminated. )inally% we a9rm the NLRCIs award and com-,tation of se-aration -ay in favor of res-ondents. ($$# Resol,tion of the National La+or Relations Commission in are RB3NST&TBD. COSMOS BOTTLING CORP. vs. WILSON FERMIN G.R. No. "@:$:% .,ne ($% ($( )&CTS* 2ilson B. )ermin ;)ermin< was a for1lift o-erator at Cosmos Bottling Cor-oration ;C?S5?S<% where he started his em-loyment on (P &,g,st "P!. ?n ! Decem+er ($$(% he was acc,sed of stealing the cell-hone of his fellow em-loyee% L,is Braga ;Braga<. )ermin was then given a Show Ca,se 5emorand,m% re8,iring him to e7-lain why the cell-hone was fo,nd inside his loc1er. 3n com-liance therewith% he s,+mitted an a9davit the following day% e7-laining that he only hid the -hone as a -ractical Co1e and had every intention of ret,rning it to Braga. &fter cond,cting an investigation% C?S5?S fo,nd )ermin g,ilty of stealing Braga6s -hone in violation of com-any r,les and reg,lations. Conse8,ently% on ( ?cto+er ($$:% the com-any terminated )ermin from em-loyment after (P years of service% eJective on ! ?cto+er ($$:. )ollowing the dismissal of )ermin from em-loyment% Braga e7ec,ted an a9davit% which stated the +elief that the former had merely -,lled a -ran1 witho,t any intention of stealing the cell-hone% and withdrew from C?S5?S his com-laint against )ermin. 5eanwhile% )ermin Aled a Com-laint for 3llegal Dismissal% which the La+or &r+iter ;L&< dismissed for lac1 of merit on the gro,nd that the act of ta1ing a fellow em-loyee6s cell-hone amo,nted to gross miscond,ct. ),rther% the L& li1ewise too1 into consideration )ermin6s other infractions% namely* ;a< committing acts of disres-ect to a s,-erior o9cer% and ;+< slee-ing on d,ty and a+andonment of d,ty. 3SSUB* 2hether the im-osition of -enalty of dismissal was a--ro-riate. RUL3NG* Theft committed against a co0em-loyee is considered as a case analogo,s to serio,s miscond,ct% for which the -enalty of dismissal from service may +e meted o,t to the erring em-loyee% (! viR.* &rticle ('( of the La+or Code -rovides* Article 343!)ermination y Employer! 5 An employer may terminate an employment for any of the following causes6 (a)Serious misconduct or willful disoedience y the employee of the lawful orders of his employer or his representati%es in connection with his work7 cSH+aA 888 888 888 (e),ther causes analogous to the foregoing. 5iscond,ct involves Ethe transgression of some esta+lished and deAnite r,le of action% for+idden act% a dereliction of d,ty% willf,l in character% and im-lies wrongf,l intent and not mere error in C,dgment.E )or miscond,ct to +e serio,s and therefore a valid gro,nd for dismissal% it m,st +e* . of grave and aggravated character and not merely trivial or ,nim-ortant and (. connected with the wor1 of the em-loyee. 3n this case% -etitioner dismissed res-ondent +ased on the NB36s Anding that the latter stole and ,sed S,seco6s credit cards. B,t since the theft was not committed against -etitioner itself +,t against one of its em-loyees% #' F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch res-ondent6s miscond,ct was not wor10related and therefore% she co,ld not +e dismissed for serio,s miscond,ct. & ca,se analogo,s to serio,s miscond,ct is a vol,ntary and>or willf,l act or omission attesting to an em-loyee6s moral de-ravity. Theft committed +y an em-loyee against a -erson other than his em-loyer% if -roven +y s,+stantial evidence% is a ca,se analogo,s to serio,s miscond,ct. (P ;Bm-hasis s,--lied.< 3n this case% the L& has already made a fact,al Anding% which was a9rmed +y +oth the NLRC and the C&% that )ermin had committed theft when he too1 Braga6s cell-hone. Th,s% this act is deemed analogo,s to serio,s miscond,ct% rendering )ermin6s dismissal from service C,st and valid. APO CEMENT CORPORATION vs. &ALDY E. BAPTISMA G.R. N?. P!!P .UNB ($% ($( )&CTS* Waldy B. Ba-tisma was em-loyed +y &-o Cement Cor-oration% a d,ly registered cor-oration maintaining and o-erating a cement man,fact,ring -lant in Naga% Ce+,. Sometime in Se-tem+er ($$:% the com-any received information that some of its -ersonnel% incl,ding Ba-tisma who was then the manager of the /ower /lant De-artment% were receiving commissions or E1ic1+ac1sE from s,--liers. The to- management cond,cted an investigation d,ring which one of the accredited s,--liers% Lo+itaVa% came forward and testiAed that $Q to ($Q of the 8,oted -rice is ,s,ally set aside as +ri+e money for certain -ersonnel. &mong those who receive +ri+es from s,--liers are 5r. .ose Cr,R% the 5echanical 5aintenance 5anager and Waldy Ba-tisma% &-o /ower /lant 5anager. =aving +een im-licated in the irreg,larities% Ba-tisma received a Show Ca,se Letter with Notice of /reventive S,s-ension. =e then s,+mitted his written e7-lanation denying the acc,sations h,rled against him. To f,rther aJord res-ondent am-le o--ort,nity to defend himself% -etitioner cond,cted a series of administrative investigation hearings. =owever% on 5arch ((% ($$@% Ba-tisma received the Notice of Termination dated 5arch "% ($$@ informing him of his dismissal from em-loyment eJective immediately on the gro,nd of loss of tr,st and conAdence. Thereafter% a com-laint for illegal dismissal was Aled +efore the La+or &r+iter. ?n .an,ary #% ($$#% La+or &r+iter declared Ba-tisma illegally0dismissed. =e o-ined that since Ba-tisma was not involved in the canvassing and -,rchasing of s,--lies% he co,ld not have entered into any irreg,lar arrangement with s,--liers. =owever% the NLRC reversed the r,ling of the La+or &r+iter. 3t r,led that his E-ersonal and direct involvement in the irreg,larities com-lained of renders him ,nworthy of the tr,st and conAdence demanded MofN his -osition.E Thereafter% the C& reinstated the Decision of the La+or &r+iter. 3t r,led that -etitioner failed to -rove the e7istence of a C,st ca,se to warrant the termination of res-ondent as the alleged loss of tr,st and conAdence was not +ased on esta+lished facts. 3SSUBS* 2hether or not there was C,st ca,se for the dismissal of Ba-tisma. SC RUL3NG* To validly dismiss an em-loyee on the gro,nd of loss of tr,st and conAdence ,nder &rticle ('( ;c<#: of the La+or Code of the /hili--ines% the following g,idelines m,st +e o+served* < loss of conAdence sho,ld not +e sim,latedD (< it sho,ld not +e ,sed as s,+terf,ge for ca,ses which are im-ro-er% illegal or ,nC,stiAedD :< it may not +e ar+itrarily asserted in the face of overwhelming evidence to the contraryD and @< it m,st +e gen,ine% not a mere aftertho,ght to C,stify earlier action ta1en in +ad faith.E 5ore im-ortant% it Em,st +e +ased on a willf,l +reach of tr,st and fo,nded on clearly esta+lished facts.E 3n this case% we agree with the NLRC that the termination of Ba-tisma on the gro,nd of loss of tr,st and conAdence was C,stiAed. Unli1e the La+or &r+iter and the C&% we And the testimony of Lo+itaVa% the s,--lier% as credi+le and tr,thf,l. To +egin with% we And no inconsistencies +etween the Arst and the second a9davits of Lo+itaVa. &lso% there a--ears to +e no ill0motive on the -art of Lo+itaVa to falsely acc,se Ba-tisma of acce-ting commissions and>or E1ic1+ac1s.E 5oreover% as +etween the -ositive testimony of Lo+itaVa that he gave Ba-tisma commissions and>or E1ic1+ac1sE on two se-arate #" F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch occasions% and the negative testimony of res-ondentIs witnesses CedeVo and BanRon that no s,ch meeting too1 -lace% we are more inclined to give credence to the former. 3t +ears stressing that a -ositive testimony -revails over a negative one% more es-ecially in this case where res-ondentIs witnesses did not even e7ec,te a9davits to attest to the tr,thf,lness of their statements. Li1ewise erroneo,s is the reasoning of the La+or &r+iter and the C& that since Ba-tisma was not involved in the -roc,rement -rocess% he co,ld not +e g,ilty of violating Section (.$@#P of the Com-any R,les and Reg,lations. <ho,gh he was not directly involved in the -roc,rement -rocess% Ba-tisma% as the then /ower /lant 5anager% act,ally wielded some a,thority which is vital and indis-ensa+le to the E-roc,rement -rocess.E Being then the manager of the /ower /lant% it was Mres-ondentIsN d,ty to a--rove -,rchase re8,isitionMsN and -re-are or ca,sed to +e -re-ared the desired s-eciAcations of the item so,ght to +e -roc,red for the /ower /lant% es-ecially on the technical side of the items. U-on the delivery% Mres-ondentN has the a,thority to determine if the items or e8,i-ment delivered are in accordance with the s-eciAcations given. 3n -erforming this f,nction% Mres-ondentN wo,ld e7ercise some discretion either to acce-t the items delivered if he Ands them to have com-lied with the desired s-eciAcations or reCect the same if to his C,dgment the items delivered failed to meet the desired s-eciAcations. Conse8,ently% C,st +eca,se Mres-ondentIsN signat,re cannot +e fo,nd in &nne7es E$%E E$0&%E E$0B%E E(%E E(0&%E E:E and E:0&E% it does not necessarily mean that Ehe has a+sol,tely nothing to doE with the entire -roc,rement -rocess. &s said% while Mres-ondentN may not have +een em-owered% Eto canvass and award -,rchase orders to s,--liers%E he was em-owered% as an end0,ser% to determine whether to acce-t or reCect any item delivered +y any s,--lier% which a,thority is -art and -arcel of the entire -roc,rement mechanism -,t in -lace +y the com-any. =ence% the testimony of Lo+itaVa constit,tes s,+stantial evidence to -rove that res-ondent% as the then /ower /lant 5anager% acce-ted commissions and>or E1ic1+ac1sE from s,--liers% which is a clear violation of Section (.$@ of -etitionerIs Com-any R,les and Reg,lations. .,ris-r,dence consistently holds that for managerial em-loyees Ethe mere e7istence of a +asis for +elieving that s,ch em-loyee has +reached the tr,st of his em-loyer wo,ld s,9ce for his dismissal.E Therefore% Ba-tismaIs termination was for a C,st and valid ca,se. REYES%RAYEL vs. PHILIPPINE LUEN THAI HOLDINGS, CORPORATION(L)T INTERNATIONAL GROUP PHILIPPINES, INC G.R. No. P@'":% .,ly % ($( )he law is fair and $ust to oth laor and management! )hus0 while the 'onstitution accords an employee security or tenure0 it ahors oppression to an employer who cannot e compelled to retain an employee whose continued employment would e patently inimical to its interest! )&CTS* 3n )e+r,ary ($$$% /LT=C hired Reyes0Rayel as Cor-orate =,man Reso,rces ;C=R< Director for 5an,fact,ring for its s,+sidiary>a9liate com-any% LUT. 3n the em-loyment contract% she was tas1ed to -erform f,nctions in relation to administration% recr,itment% +eneAts% a,dit>com-liance% -olicy develo-ment> str,ct,re% -roCect -lan% and s,ch other wor1s as may +e assigned +y her immediate s,-erior% Sa,ceda% /LT=CIs Cor-orate Director for =,man Reso,rces. ?n Se-tem+er !% ($$% -etitioner received a /rere8,isite Notice from Sa,ceda and the Cor-orate Legal Co,nsel of /LT=C% 5a. Lorelie T. Bdles ;Bdles<. The /RBRBRBYU3S3TB N?T3CB contained averments to her fail,re to -erform in accordance with management directives in vario,s instances% s,ch as* < She made -rono,ncements against the =R( -rogram which is for the enhancement of -ersonnel management in the com-any. (< =er ina+ility to incite colla+oration U harmony within the Cor-orate =,man Reso,rces Division ;C=RD<.Com-laints of her negative attit,de towards the com-any. :< =er negative acts led to the de-art,re of -romising em-loyees who co,ld not wor1 with her. The Notice said that these acts led to L?SS ?) C?N)3DBNCB in her ca-a+ility to -romote the interests of the com-any. The com-any gave her the o--ort,nity to s,+mit her written re-ly to the memo within @' ho,rs from recei-t. 3t f,rther read* K)ail,re to so s,+mit shall +e constr,ed as waiver of yo,r right to +e heard. Conse8,ently% the Com-any shall immediately decide on this matter.O !$ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch 3n her written res-onse dated Se-tem+er $% ($$% Reyes0Rayel e7-lained that* =er alleged fail,re to -erform management directives co,ld +e attri+,ted to the lac1 of eJective comm,nication with her s,-eriors d,e to malf,nctioning email system. She denied ,ttering negative comments a+o,t the =R( /rogram and instead claimed to have intimated her s,--ort for it. She f,rther denied ca,sing disharmony in her division. She em-hasiRed that in .,ne ($$% she received a relatively good rating of '$.(Q in her overall -erformance a--raisal which meant that she dis-layed de-enda+le wor1 level -erformance as well as good cor-orate relationshi- with her s,-eriors and s,+ordinates. Reyes0Rayel was given termination notice on Se-tem+er (%($$. She was dismissed from the service for loss of conAdence on her a+ility to -romote the interests of the com-any. /etitioner arg,es that* There is no s,+stantial evidence to esta+lish valid gro,nds for her dismissal since vario,s emails from her s,-eriors ill,strating her accom-lishments and commendations% as well as her EgoodE overall -erformance rating negate loss of tr,st and conAdence. She also insists that she was not aJorded d,e -rocess at the com-any level. She claims that she was not -ro-erly informed of the oJenses charged against her d,e to the vag,eness of the terms written in the termination notices and that no investigation and hearing was cond,cted as re8,ired +y com-any -olicy. 3SSUBS* a. 2?N -etitioner was illegally dismissed. +. 2?N -etitioner was accorded d,e -rocess. RUL3NG* The -etition is devoid of merit. Reyes0Rayel was validly dismissed. A! )here e8ists a %alid ground for petitioner9s termination from employment! .,ris-r,dence -rovides that an em-loyer has a distinct -rerogative and wider latit,de of discretion in dismissing a managerial -ersonnel who -erforms f,nctions which +y their nat,re re8,ire the em-loyerIs f,ll tr,st and conAdence. &s disting,ished from a ran1 and Ale -ersonnel% mere e7istence of a +asis for +elieving that a managerial em-loyee has +reached the tr,st of the em-loyer C,stiAes dismissal. EMLNoss of conAdence as a gro,nd for dismissal does not re8,ire -roof +eyond reasona+le do,+t as the law re8,ires only that there +e at least some +asis to C,stify it.E /etitioner holds a managerial -osition. She was com-anyIs C=R Director for 5an,fact,ring. She was directly res-onsi+le for managing her own staJ. She was the KfaceO of the com-any to its em-loyees. D,e to her -osition% she m,st enCoy the f,ll tr,st U conAdence of her s,-eriors. She o,ght to 1now that she is E+o,nd +y more e7acting wor1 ethicsE and sho,ld live ,- to this high standard of res-onsi+ility. Res-ondents also im-,te ,-on -etitioner gross negligence and incom-etence which are li1ewise C,stiAa+le gro,nds for dismissal. The +,rden of -roving that the termination was for a valid ca,se lies on the em-loyer. =ere% res-ondents were a+le to overcome this +,rden as the evidence -resented clearly s,--ort the validity of -etitionerIs dismissal* . Records show that -etitioner indeed ,nreasona+ly failed to eJectively comm,nicate with her immediate s,-erior in order to ens,re that her wor1 is ,- to -ar. (. &9davits of her co0wor1ers revealed her negative attit,de U ,n-rofessional +ehavior towards them U the com-any. They all descri+ed her as having an KirrationalO +ehavior and Es,-erior and condescendingE attit,de in the wor1-lace. :. =er dis-lay of ine9ciency and ine-tit,de in her Co+ as a C=R Director. She% on two occasions% gave wrong information regarding iss,es on leave and holiday -ay which generated conf,sion among em-loyees in the com-,tation of salaries and wages. D,e to the nat,re of her f,nctions% -etitioner is e7-ected to have strong wor1ing 1nowledge of la+or laws and reg,lations to hel- shed light on iss,es and 8,estions regarding the same instead of com-licating them. /etitioner o+vio,sly failed in this res-ect. The C& is correct in saying that her '$.(Q rating are low mar1s which revealed the Edegree of M-etitionerIsN wor1 handica-.O She delivered dismal -erformance U dis-layed -oor wor1 attit,de which constit,te s,9cient reasons for an BR to terminate an BB on the gro,nd of L?SS ?) TRUST &ND C?N)3DBNCB. &n em-loyer Ehas the right to reg,late% according to its discretion and +est C,dgment% all as-ects of em-loyment% incl,ding wor1 assignment% wor1ing methods% -rocesses to +e followed% wor1ing reg,lations% transfer of em-loyees% wor1 s,-ervision% lay0oJ of wor1ers and the disci-line% ! F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch dismissal and recall of wor1ers.E EMSNo long as they are e7ercised in good faith for the advancement of the em-loyerIs interest and not for the -,r-ose of defeating or circ,mventing the rights of the em-loyees ,nder s-ecial laws or ,nder valid agreements%E the e7ercise of this management -rerogative m,st +e ,-held. #! Petitioner was accorded due process! /etitioner insists that she was not -ro-erly a--rised of the s-eciAc gro,nds for her termination as to give her a reasona+le o--ort,nity to e7-lain +eca,se the /rere8,isite Notice and Notice of Termination did not mention any valid or a,thoriRed ca,se for dismissal +,t rather merely contained general allegations and vag,e terms. The SC e7amined that /rere8,isite Notice and held that it was free from any am+ig,ity. The said notice -ro-erly advised -etitioner to e7-lain thro,gh a written res-onse her fail,re to -erform in accordance with management directives% which deAciency res,lted in the com-anyIs loss of conAdence in her ca-a+ility to -romote its interest. The notice cited s-eciAc incidents from vario,s instances which showed -etitionerIs Ere-eated fail,re to com-ly with wor1 directives% her inclination to ma1e negative remar1s a+o,t com-any goals and her di9c,lt -ersonality%E that have collectively contri+,ted to the com-anyIs loss of tr,st and conAdence in her. These s-eciAed acts% in addition to her low -erformance rating% demonstrated -etitionerIs neglect of d,ty and incom-etence which s,--ort the termination for loss of tr,st and conAdence. Neither can there +e any denial of d,e -rocess d,e to the a+sence of a hearing or investigation at the com-any level. 3t has +een held in a -lethora of cases that d,e -rocess re8,irement is met when there is sim-ly an o--ort,nity to +e heard and to e7-lain oneIs side even if no hearing is cond,cted. 3n the case of Pere: %! Philippine )elegraph and )elephone 'ompany0 this Co,rt -rono,nced that an em-loyee may +e aJorded am-le o--ort,nity to +e heard +y means of any method% ver+al or written% whether in a hearing% conference or some other fair% C,st and reasona+le way. The following are the GU3D3NG /R3NC3/LBS in connection with T=B =B&R3NG RBYU3RB5BNT 3N D3S53SS&L C&SBS* ;a< aam-le o--ort,nity to +e heardI means any meaningf,l o--ort,nity ;ver+al or written< given to the em-loyee to answer the charges against him and s,+mit evidence in s,--ort of his defense% whether in a hearing% conference or some other fair% C,st and reasona+le way. ;+< a formal hearing or conference +ecomes mandatory only when re8,ested +y the em-loyee in writing or s,+stantial evidentiary dis-,tes e7ist or a com-any r,le or -ractice re8,ires it% or when similar circ,mstances C,stify it. ;c< the aam-le o--ort,nity to +e heardI standard in the La+or Code -revails over the ahearing or conferenceI re8,irement in the im-lementing r,les and reg,lations. 3n this case% -etitioner6s written res-onse to the /rere8,isite Notice -rovided her with an aven,e to e7-lain and defend her side and th,s served the -,r-ose of d,e -rocess. That there was no hearing. investigation or right to a--eal which -etitioner o-ined to +e violation of com-any -olicies% is of no moment since the records is +ereft of any showing that there is an e7isting com-any -olicy that re8,ires these -roced,res with res-ect to the termination of a C=R Director li1e -etitioner or that com-any -ractice calls for the same. There was also no re8,est for a formal hearing on the -art of -etitioner. &s she was served with a notice a--rising her of the changes against her and also a s,+se8,ent notice informing her of the management6s decision to terminate her services alter res-ondents fo,nd her written res-onse to the Arst notice ,nsatisfactory% -etitioner was clearly aJorded her right to d,e -rocess. NARANO V. BIOMEDICAL HEALTH CARE SB/TB5BBR "% ($( )&CTS* Res-ondent Biomedica =ealth Care% 3nc. ;Biomedica< was% d,ring the material -eriod% engaged in the distri+,tion of medical e8,i-ment. Res-ondent Carina KXarenO .. 5otol ;5otol< was then its /resident. /etitioners were former em-loyees of Biomedica. ?n 5otolIs +irthday% -etitioners were a+sent for vario,s reasons. These same em-loyees or res-ondents were the ones who Aled a case against Biomedica in the De-artment of La+orfor lac1 of salary increases% fail,re to remit Social !( F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch Sec,rity System and /ag03B3G contri+,tions% and violation of the minim,m wage law% among other grievances. /er availa+le records% the com-laint has not +een acted ,-on.Later that day% -etitioners re-orted for wor1 after receiving te7t messages for them to -roceed to Biomedica. They were% however% ref,sed entry and told to start loo1ing for another wor1-lace./etitioners allegedly came in for wor1 +,t were not allowed to enter the -remises. The following day%on Novem+er "% ($$!% Biomedica iss,ed a notice of -reventive s,s-ension and notices to e7-lain within (@ ho,rs ;Notices<to -etitioners. 3n the Notices% Biomedica acc,sed the -etitioners of having cond,cted an illegal stri1e and were accordingly directed to e7-lain why they sho,ld not +e held g,ilty of and dismissed for violating the com-any -olicy against illegal stri1es ./etitioners were re8,ired to -roceed to the Biomedica o9ce where they were each served their Notices.?nly &ngeles and Casimiro s,+mitted their written e7-lanation for their a+sence whereinthey alleged that -etitioners forced them to go on a Kmass leaveO while as1ing Biomedica for forgiveness for their actions. % -etitioners Aled a Com-laint with the NLRC for constr,ctive dismissal and non-ayment of salaries% overtime -ay% :thmonth -ay as well as non0remittance of SSS% /ag03B3G and /hilhealth contri+,tions as well as loan -ayments. Thereafter% Biomedica served Notices of Termination on -etitioners. La+or ar+iter held that -etitioners -erformed an illegal stri1e and g,ilty of s,ch miscond,ct. ?n a--eal% NLRC r,led that they were illegally dismissed. ?n a--eal of C&% the decision of the La+or &r+iter was ,-held. =ence this case. 3SSUB* 2?N the -etitioners were illegally dismissed. =BLD* They were illegally dismissed. 3t +ears -ointing o,t that in the dismissal of an em-loyee% the law re8,ires that d,e -rocess +e o+served. S,ch d,e -rocess re8,irement is twofold% -roced,ral and s,+stantive% that is% Kthe termination of em-loyment m,st +e +ased on a C,st or a,thoriRed ca,se of dismissal and the dismissal m,st +e eJected after d,e notice and hearing.O 3n the instant case% -etitioners were not aJorded +oth -roced,ral and s,+stantive d,e -rocess. Th,s% the Co,rt ela+orated in Xing of Xings Trans-ort% 3nc. v. 5amac that a mere general descri-tion of the charges against an em-loyee +y the em-loyer is ins,9cient to com-ly with the a+ove -rovisions of the law. 3n the instant case% the notice s-ecifying the gro,nds for termination are as follows* BJective ,-on recei-t hereof% yo, are -laced ,nder -reventive s,s-ension for willf,lly organiRing and>or engaging in illegal stri1e on Novem+er P% ($$!. So,r said illegal act0in cons-iracy with yo,r other co0em-loyees% -aralyRed the com-any o-eration on that day and res,lted to ,nd,e damage and -reC,dice to the com-any and is direct violation of &rticle \3% Category )o,r Section !% '% (% ' U (# of o,r Com-any /olicy% which if fo,nd g,ilty% yo, will +e meted a -enalty of dismissal. /lease e7-lain in writing within (@ ho,rs from recei-t hereof why yo, sho,ld not +e held g,ilty of violating the com-any -olicy considering f,rther that yo, committed and timed s,ch act d,ring the +irthday of o,r Com-any -resident. Clearly% -etitioners were charged with cond,cting an illegal stri1e% not a mass leave% witho,t s-ecifying the e7act acts that the com-any considers as constit,ting an illegal stri1e or violative of com-any -olicies. S,ch allegation falls short of the re8,irement in Xing of Xings Trans-ort% 3nc. of Ka detailed narration of the facts and circ,mstances that will serve as +asisfor the charge against the em-loyees.O & +are mention of an Killegal stri1eO will not s,9ce),rther% while Biomedica cites the -rovisions of the com-any -olicy which -etitioners -,r-ortedly violated% it failed to 8,ote said -rovisions in the notice so -etitioners can +e ade8,ately informed of the nat,re of the charges against them and intelligently Ale their e7-lanation and defenses to said acc,sations. The notice is +are of s,ch descri-tion of the com-any -olicies. 5oreover% it is inc,m+ent ,-on res-ondent com-any to show that -etitioners were d,ly informed of said com-any -olicies at the time of their em-loyment and were given co-ies of these -olicies. No s,ch -roof was -resented +y res-ondents. There was even no mention at all that s,ch re8,irement was met. 2orse% res-ondent Biomedica did not even 8,ote or re-rod,ce the com-any -olicies referred to in the notice as -ointed o,t +y the C& stating* 3t m,st +e noted that the com-any -olicy which the -etitioner was referring to was not 8,oted or re-rod,ced in the -etition% a co-y of which is not also a--ended in the -etition% as s,ch we cannot determine the veracity of the e7istence of said -olicy. 5oreover% the -eriod of (@ ho,rs allotted to -etitioners to answer the notice was severely ins,9cient and in violation of the im-lementing r,les !: F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch of the La+or Code. Under the im-lementing r,le of &rt. (PP% an em-loyee sho,ld +e given Kreasona+le o--ort,nityO to Ale a res-onse to the notice. Xing of Xings Trans-ort% 3nc. el,cidates in this wise* To clarify% the following sho,ld +e considered in terminating the services of em-loyees* ;< The Arst written notice to +e served on the em-loyees sho,ld contain the s-eciAc ca,ses or gro,nds for termination against them% and a directive that the em-loyees are given the o--ort,nity to s,+mit their written e7-lanation within a reasona+le -eriod. KReasona+le o--ort,nityO ,nder the ?mni+,s R,les means every 1ind of assistance that management m,st accord to the em-loyees to ena+le them to -re-are ade8,ately for their defense. This sho,ld +e constr,ed as a -eriod of at least Ave ;#< calendar days from recei-t of the notice to give the em-loyees an o--ort,nity to st,dy the acc,sation against them% cons,lt a ,nion o9cial or lawyer% gather data and evidence% and decide on the defenses they will raise against the com-laint. 3n addition% Biomedica did not set the charges against -etitioners for hearing or conference in accordance with Sec. (% Boo1 4% R,le \333 of the 3m-lementing R,les and Reg,lations of the La+or Code and in line with r,ling in Xing of Xings Trans-ort% 3nc.% where the Co,rt e7-lained* ;(< &fter serving the Arst notice% the em-loyers sho,ld sched,le and cond,ct a hearing or conference wherein the em-loyees will +e given the o--ort,nity to* ;< e7-lain and clarify their defenses to the charge against themD ;(< -resent evidence in s,--ort of their defensesD and ;:< re+,t the evidence -resented against them +y the management. D,ring the hearing or conference% the em-loyees are given the chance to defend themselves -ersonally% with the assistance of a re-resentative or co,nsel of their choice. 5oreover% this conference or hearing co,ld +e ,sed +y the-arties as an o--ort,nity to come to an amica+le settlement. 2hile -etitioners did not s,+mit any written e7-lanation to the charges% it is inc,m+ent for Biomedica to set the matter for hearing or conference to hear the defenses and receive evidence of the em-loyees. 5ore im-ortantly% Biomedica is d,ty0+o,nd to e7ert eJorts% d,ring said hearing or conference% to hammer o,t a settlement of its diJerences with -etitioners. These -rescri-tions Biomedica failed to satisfy. Lastly% Biomedica again deviated from the dictated contents of a written notice of termination as laid down in Sec. (% Boo1 4% R,le \333 of the 3m-lementing R,les that it sho,ld em+ody the facts and circ,mstances to s,--ort the gro,nds C,stifying the termination. &s am-liAed in Xing of Xings Trans-ort% 3nc.* ;:< &fter determining that termination of em-loyment is C,stiAed% the em-loyers shall serve the em-loyees a written notice of termination indicating that* ;< all circ,mstances involving the charge against the em-loyees have +een consideredD and ;(< gro,nds have +een esta+lished to C,stify the severance of their em-loyment. The Novem+er (!% ($$! Notice of Termination iss,ed +y Biomedica misera+ly failed to satisfy the re8,isite contents of a valid notice of termination% as it sim-ly mentioned the fail,re of -etitioners to s,+mit their res-ective written e7-lanations witho,t disc,ssing the facts and circ,mstances to s,--ort the alleged violations of Secs. !% '% (% ' and (# of Category )o,r% &rt.\3 of the alleged com-any r,les. &ll told% Biomedica made mincemeat of the d,e -rocess re8,irements ,nder the 3m-lementing R,les and the Xing of Xings Trans-ort% 3nc. r,ling +y sim-ly not following any of their dictates% to the e7treme -reC,dice of -etitioners. /etitioners were also denied of s,+stantive d,e -rocess.Clearly% to C,stify the dismissal of an em-loyee on the gro,nd of serio,s miscond,ct% the em-loyer m,st Arst esta+lish that the em-loyee is g,ilty of im-ro-er cond,ct% that the em-loyee violated an e7isting and valid com-any r,le or reg,lation% or that the em-loyee is g,ilty of a wrongdoing. 3n the instant case% Biomedica failed to even esta+lish that -etitioners indeed violated com-any r,les% failing to even -resent a co-y of the r,les and to -rove that -etitioners were made aware of s,ch reg,lations. 3n fact% from the records of the case% Biomedica has failed to -rove that -etitioners are g,ilty of a wrongdoing that is -,nisha+le with termination from em-loyment. &rt. (PP;+< of the La+or Code states% KThe +,rden of -roving that the termination was for a valid or a,thoriRed ca,se shall rest on the em-loyer.O 3n the instant case% Biomedica failed to overcomes,ch +,rden. &s will +e shown% -etitionersI a+sence on Novem+er P% ($$! cannot +e considered a massleave% m,ch less a stri1e and% th,s% cannot C,stify their dismissal fromem-loyment. The acc,sation is for engaging in a mass leave tantamo,nt to an illegal stri1e. The term K5ass LeaveO has +een left ,ndeAned +y the La+or Code. !@ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch /lainly% the legislat,re intended that thetermIs ordinary sense +e ,sed. K5assO is deAned as K-artici-ated in% attended +y% or aJecting a large n,m+er of individ,alsD having a large0scale character% 2hile the term KLeaveO is deAned as Kan a,thoriRed a+sence or vacation from d,ty or em-loyment ,s,ally with -ay.OTh,s% the -hrase Kmass leaveO may refer to a sim,ltaneo,s availmentof a,thoriRed leave +eneAts +y a large n,m+er of em-loyee in a com-any. XV. SUSPENSION OF BUSINESS OPERATIONS XVI. DISEASE AS A GROUND OF TERMINATION VILLARUEL vs. YEO HAN GUAN G.R. No. !""% .UNB % ($ )&CTS* ?n )e+r,ary #% """% herein -etitioner Aled with the NLRC% National Ca-ital Region% Y,eRon City a Com-laintM:N for -ayment of se-aration -ay against S,hans Bnter-rises. S,+se8,ently% in his &mended Com-laint and /osition /a-er dated Decem+er !%"""% -etitioner alleged that in .,ne "!:% he was em-loyed as a machine o-erator +y Ri+onette 5an,fact,ring Com-any% an enter-rise engaged in the +,siness of man,fact,ring and selling /4C -i-es and is owned and managed +y herein res-ondent Seo =an G,an. ?ver a -eriod of almost twenty ;($< years% the com-any changed its name fo,r times. Starting in "": ,- to the time of the Aling of -etitioner6s com-laint in """% the com-any was o-erating ,nder the name of S,hans Bnter-rises. Des-ite the changes in the com-any6s name% -etitioner remained in the em-loy of res-ondent. /etitioner f,rther alleged that on ?cto+er #% ""'% he got sic1 and was conAned in a hos-italD on Decem+er(% ""'% he re-orted for wor1 +,t was no longer -ermitted to go +ac1 +eca,se of his illnessD he as1ed that res-ondent allow him to contin,e wor1ing +,t +e assigned a lighter 1ind of wor1 +,t his re8,est was deniedD instead% he was oJered a s,m of /#%$$$.$$ as his se-aration -ayD however% the said amo,nt corres-onds only to the -eriod +etween "": and """D -etitioner -rayed that he +e granted se-aration -ay com-,ted from his Arst day of em-loyment in .,ne "!:% +,t res-ondent ref,sed. &side from se-aration -ay% -etitioner -rayed for the -ayment of service incentive leave for three years as well as attorney6s fees. ?n the other hand% res-ondent averred in his /osition /a-erM#N that -etitioner was hired as machine o-erator from 5arch % "": ,ntil he sto--ed wor1ing sometime in )e+r,ary """ on the gro,nd that he was s,Jering from illnessD after his recovery% -etitioner was directed to re-ort for wor1% +,t he never showed ,-. Res-ondent was later ca,ght +y s,r-rise when -etitioner Aled the instant case for recovery of se-aration -ay. Res-ondent claimed that he never terminated the services of -etitioner and that d,ring their mandatory conference% he even told the latter that he co,ld go +ac1 to wor1 anytime +,t -etitioner clearly manifested that he was no longer interested in ret,rning to wor1 and instead as1ed for se-aration -ay. ?n Novem+er (P% ($$$% the La+or &r+iter handling the case rendered C,dgment in favor of -etitioner. &ggrieved% res-ondent Aled an a--eal with the NLRC which also dismissed the -etition. ?n 5arch :% ($$:% the Third Division of the NLRC rendered its Decision dismissing res-ondent6s a--eal and a9rming the La+or &r+iter6s Decision. 3n theC&% -etition was -artially granted. 3SSUB* 2hether or not res-ondent% in fact% dismissed -etitioner from his em-loyment. SC RUL3NG* The Co,rt Ands no convincing C,stiAcation% in the Decision of the La+or &r+iter on why -etitioner is entitled to s,ch -ay. 3n the same manner% the NLRC Decision did not give any rationaliRation as the gist thereof sim-ly consisted of a 8,oted -ortion of the a--ealed Decision of the La+or &r+iter. ?n the other hand% the Co,rt agrees with the C& in its o+servation of the following circ,mstances as -roof that res-ondent did not terminate -etitioner6s em-loyment* Arst % the only ca,se of action in -etitioner6s original com-laint is that he was EoJered a very low se-aration -ayED second % there was no allegation of illegal dismissal% +oth in -etitioner6s original and amended com-laints and -osition -a-erD and% third % there was no -rayer for reinstatement. in consonance with the a+ove Andings% the Co,rt Ands that -etitioner was the one who initiated the severance of his em-loyment relations with res-ondent. 3t is evident from the vario,s -leadings Aled +y -etitioner that he never intended to ret,rn to his em-loyment with res-ondent on the gro,nd that his health is failing. 3ndeed% -etitioner did not as1 for reinstatement. 3n fact% he reCected res-ondent6s oJer for him to ret,rn to wor1. This is tantamo,nt to resignation. !# F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch Resignation is deAned as the vol,ntary act of an em-loyee who Ands himself in a sit,ation where he +elieves that -ersonal reasons cannot +e sacriAced in favor of the e7igency of the service and he has no other choice +,t to disassociate himself from his em-loyment. By way of e7ce-tion% this Co,rt has allowed grants of se-aration -ay to stand as Ea meas,re of social C,sticeE where the em-loyee is validly dismissed for ca,ses other than serio,s miscond,ct or those reTecting on his moral character. =owever% there is no -rovision in the La+or Code which grants se-aration -ay to vol,ntarily resigning em-loyees. 3n fact% the r,le is that an em-loyee who vol,ntarily resigns from em-loyment is not entitled to se-aration -ay% e7ce-t when it is sti-,lated in the em-loyment contract or CB&% or it is sanctioned +y esta+lished em-loyer -ractice or -olicy. 3n the -resent case% neither the a+ovementioned -rovisions of the La+or Code and its im-lementing r,les and reg,lations nor the e7ce-tions a--ly +eca,se -etitioner was not dismissed from his em-loyment and there is no evidence to show that -ayment of se-aration -ay is sti-,lated in his em-loyment contractor sanctioned +y esta+lished -ractice or -olicy of herein res-ondent% his em-loyer. Since -etitioner was not terminated from his em-loyment and% instead% is deemed to have resigned there from% he is not entitled to se-aration -ay ,nder the -rovisions of the La+or Code. B,t we m,st stress that this Co,rt did allow% in several instances% the grant of Anancial assistance as a meas,re of social C,stice and e7ce-tional circ,mstances% and as an e8,ita+le concession. The instant case e8,ally calls for +alancing the interests of the em-loyer with those of the wor1er% if only to a--ro7imate what .,stice La,rel calls C,stice in its sec,lar sense. 3n the -resent case% res-ondent had +een em-loyed with the -etitioner for almost twelve ;(< years. ?n )e+r,ary :% ""!% he s,Jered from a Efract,red left transverse -rocess of fo,rth l,m+ar verte+ra%E while their vessel was at the -ort of So1ohama% .a-an. &fter cons,lting a doctor% he was re8,ired to rest for a month. 2hen he was re-atriated to 5anila and e7amined +y a com-any doctor% he was declared At to contin,e his wor1. 2hen he re-orted for wor1% -etitioner ref,sed to em-loy him des-ite the ass,rance of its -ersonnel manager. Res-ondent -atiently waited for more than one year to em+ar1 on the vessel as(nd Bngineer% +,t the -osition was not given to him% as it was occ,-ied +y another -erson 1nown to one of the stoc1holders. Conse8,ently% for having +een de-rived of contin,ed em-loyment with -etitioner6s vessel% res-ondent o-ted to a--ly for o-tional retirement. 3n addition% records show that res-ondent6s seaman6s +oo1% as d,ly noted and signed +y the ca-tain of the vessel was mar1ed E4ery Good%E and Erecommended for hire.E 5oreover% res-ondent had no derogatory record on Ale over his long years of service with the -etitioner. Considering all of the foregoing and in line with Bastern% the ends of social and com-assionate C,stice wo,ld +e served +est if res-ondent will +e given some e8,ita+le relief. Th,s% the award of /$$% $$$.$$ to res-ondent as Anancial assistance is deemed e8,ita+le ,nder the circ,mstances. /etition denied. XVII. OTHER CAUSES OF SEVERANCE OF EMPLOYMENT SKIPPERS UNITED PACIFIC, INC. vs. DO&A, ET. AL. G.R. No. P###'% )BBRU&RS '% ($( )&CTS* S1i--ers United /aciAc% 3nc. de-loyed% in +ehalf of S1i--ers% De Gracia% Lata% and &-rosta to wor1 on +oard the vessel 54 2isdom Star. De Gracia% et al. claimed that S1i--ers failed to remit their res-ective allotments for almost Ave months% com-elling them to air their grievances with the Romanian Seafarers )ree Union.?n ! Decem+er ""'% 3T) 3ns-ector &drian 5ihalcioi, of the Romanian Seafarers Union sent Ca-tain Savvas of Cosmos Shi--ing a fa7 letter% relaying the com-laints of his crew% namely* home allotment delay% ,n-aid salaries ;only advances<% late -rovisions% lac1 of la,ndry services ;only one washing machine<% and lac1 of maintenance of the vessel ;-erforated and ,nre-aired dec1<.To date% however% S1i--ers only failed to remit the home allotment for the month of Decem+er ""'.?n (' .an,ary """% De Gracia% et al. were ,nceremonio,sly discharged from 54 2isdom Stars and immediately re-atriated.U-on arrival in the /hili--ines% De Gracia% et al. Aled a com-laint for illegal dismissal with the La+or &r+iter on @ &-ril """ and -rayed for -ayment of their home allotment for the month of Decem+er ""'% salaries for the ,ne7-ired -ortion of their contracts% moral damages% e7em-lary damages% and attorney6s fees. S1i--ers% on the other hand% claims% as evidenced +y a tele7 re-ort to S1i--ers that on : Decem+er ""'% De Gracia% smelling strongly of alcohol% went to the ca+in of Ga+riel ?lesRe1% 5aster of 54 2isdom Stars% and was r,de% sho,ting noisily to the master. 3t also claims that on (( .an,ary """% fo,r )ili-ino seafarers% namely &-rosta% De Gracia% Lata and DoRa% arrived in !! F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch the master6s ca+in and demanded immediate re-atriation +eca,se they were not satisAed with the shi-% as evidenced +y a tele7 of Cosmoshi- 54 2isdom to S1i--ers% which however +ears conTicting dates of (( .an,ary ""' and (( .an,ary """. S1i--ers also claims that% d,e to the disem+ar1ation of De Gracia% et al.% P other seafarers disem+ar1ed ,nder a+normal circ,mstsances% which was again evidenced +y a fa7 of Cosmoshi- 54 2isdom to S1i--ers% which +ears conTicting dates of (@ .an,ary ""' and (@ .an,ary """. S1i--ers% in its /osition /a-er% also admitted non0-ayment of home allotment for the month of Decem+er ""'% +,t -rayed for the oJsetting of s,ch amo,nt with the re-atriation e7-enses. Since De Gracia% et al. -re0terminated their contracts% S1i--ers claims they are lia+le for their re-atriation e7-ensesin accordance with Section ";G< of /hili--ine ?verseas Bm-loyment &dministration ;/?B&< 5emorand,m Circ,lar No. ##% series of ""! and f,rther -rayed for moral and e7em-lary damages. L& dismissed De Gracia% et al.6s com-laint for illegal dismissal +eca,se the seafarers vol,ntarily -re0terminated their em-loyment contracts +y demanding for immediate re-atriation d,e to dissatisfaction with the shi-. The La+or &r+iter held that s,ch vol,ntary -re0termination of em-loyment contract is a1in to resignation% a form of termination +y em-loyee of his em-loyment contract ,nder &rticle ('# of the La+or Code. The La+or &r+iter gave weight and credi+ility to the tele7 of the master of the vessel to S1i--ers. NRLC a9rmed L&Is decision. C& reversed the decisions of the La+or &r+iter and NLRC. 3SSUB* 2hether or not the seafarers were illegally dismissed or was there vol,ntary -re0termination of em-loyment contract. SC RUL3NG* )or a wor1er6s dismissal to +e considered valid% it m,st com-ly with +oth -roced,ral and s,+stantive d,e -rocess. The legality of the manner of dismissal constit,tes -roced,ral d,e -rocess% while the legality of the act of dismissal constit,tes s,+stantive d,e -rocess. /roced,ral d,e -rocess in dismissal cases consists of the twin re8,irements of notice and hearing. The em-loyer m,st f,rnish the em-loyee with two written notices +efore the termination of em-loyment can +e eJected* ;< the Arst notice a--rises the em-loyee of the -artic,lar acts or omissions for which his dismissal is so,ghtD and ;(< the second notice informs the em-loyee of the em-loyer6s decision to dismiss him. Before the iss,ance of the second notice% the re8,irement of a hearing m,st +e com-lied with +y giving the wor1er an o--ort,nity to +e heard. 3t is not necessary that an act,al hearing +e cond,cted. S,+stantive d,e -rocess% on the other hand% re8,ires that dismissal +y the em-loyer +e made ,nder a C,st or a,thoriRed ca,se ,nder &rticles ('( to ('@ of the La+or Code. 3n this case% there was no written notice f,rnished to De Gracia% et al. regarding the ca,se of their dismissal. Cosmoshi- f,rnished a written notice ;tele7< to S1i--ers% the local manning agency% claiming that De Gracia% et al. were re-atriated +eca,se the latter vol,ntarily -re0terminated their contracts. This tele7 was given credi+ility and weight +y the La+or &r+iter and NLRC in deciding that there was -re0termination of the em-loyment contract Ea1in to resignationE and no illegal dismissal. =owever% as correctly r,led +y the C&% the tele7 message is Ea +iased and self0serving doc,ment that does not satisfy the re8,irement of s,+stantial evidence.E 3f% indeed% De Gracia% et al. vol,ntarily -re0terminated their contracts% then De Gracia% et al. sho,ld have s,+mitted their written resignations. &rticle ('# of the La+or Code recogniRes termination +y the em-loyee of the em-loyment contract +y Eserving written notice on the em-loyer at least one ;< month in advance.E Given that -rovision% the law contem-lates the re8,irement of a written notice of resignation. 3n the a+sence of a written resignation% it is safe to -res,me that the em-loyer terminated the seafarers. 3n addition% the tele7 message relied ,-on +y the La+or &r+iter and NLRC +ore conTicting dates of (( .an,ary ""' and (( .an,ary """% giving do,+t to the veracity and a,thenticity of the doc,ment. 3n (( .an,ary ""'% De Gracia% et al. were not even em-loyed yet +y the foreign -rinci-al. )or these reasons% the dismissal of De Gracia% et al. was illegal. ?n the iss,e of home allotment -ay% S1i--ers eJectively admitted non0 remittance of home allotment -ay for the month of Decem+er ""' in its /osition /a-er. S1i--ers so,ght the re-atriation e7-enses to +e oJset with the home allotment -ay. =owever% since De Gracia% et al.6s dismissal was illegal% their re-atriation e7-enses were for the acco,nt of S1i--ers and co,ld not +e oJset with the home allotment -ay. !P F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch Contrary to the claim of the La+or &r+iter and NLRC that the home allotment -ay is in Ethe nat,re of e7traordinary money where the +,rden of -roof is shifted to the wor1er who m,st -rove he is entitled to s,ch monetary +eneAt%E Section ' of /?B& 5emorand,m Circ,lar No. ##% series of ""!% states that the allotment act,ally constit,tes at least eighty -ercent ;'$Q< of the seafarer6s salary. /aragra-h ( of the em-loyment contracts of De Gracia% Lata and &-rosta incor-orated the -rovisions of a+ove 5emorand,m Circ,lar No. ##% series of ""!% in the em-loyment contracts. Since said memorand,m states that home allotment of seafarers act,ally constit,tes at least eighty -ercent ;'$Q< of their salary% home allotment -ay is not in the nat,re of an e7traordinary money or +eneAt% +,t sho,ld act,ally +e considered as salary. . )or this reason% s,ch non0 remittance of home allotment -ay sho,ld +e considered as ,n-aid salaries% and S1i--ers shall +e lia+le to -ay the home allotment -ay of De Gracia% et al. for the month of Decem+er ""'. C& decision is &))3R5BD and S1i--ers United /aciAc% 3nc. and S1i--ers 5aritime Services 3nc.% Ltd. are Cointly and severally lia+le for -ayment of the following* < Unremitted home allotment -ay for the month of Decem+er ""' in its e8,ivalent rate in /hili--ine /esos at the time of termination on (' .an,ary """D (< Salary for the ,ne7-ired -ortion of the em-loyment contract or its c,rrent e8,ivalent in /hili--ine /esosD :< &ttorney6s fees and litigation e7-enses e8,ivalent to $Q of the total claims. XVIII. PRESCRIPTION OF CLAIMS MEDLINE MANAGEMENT INC., vs. ROSLINDA G.R. No. !'P#% SB/TB5BBR #% ($$ )&CTS* /etitioner 5edline 5anagement% 3nc. ;553<% on +ehalf of its foreign -rinci-al% -etitioner Grecomar Shi--ing &gency ;GS&<% hired .,liano Roslinda ;.,liano< to wor1 on +oard the vessel 54 E4ictory.E =is contract was a--roved +y the /?B& on Se-tem+er "% ""' for a d,ration of nine months. 3n accordance with which% he +oarded the vessel 54 E4ictoryE on ?cto+er (#% ""' as an oiler and% after several months of e7tension% was discharged on .an,ary ($% ($$$. 5onths after his re-atriation% or on 5arch !% ($$$% .,liano cons,lted Dr. /amela R. Lloren ;Dr. Lloren< of 5etro-olitan =os-ital. =e com-lained a+o,t a+dominal distention which is the medical term for a -atient who vomits -revio,sly ingested foods. 3n a 5edical CertiAcate iss,ed +y Dr. Lloren% the condition of .,liano re8,ired hemodialysis. =owever% on &,g,st (P% ($$% .,liano died. ?n Se-tem+er @% ($$:% his wife Gliceria Roslinda and son &riel Roslinda% res-ondents herein% Aled a com-laint against 553 and GS& for -ayment of death com-ensation% reim+,rsement of medical e7-enses% damages% and attorney6s fees +efore the La+or &r+itration Branch of the NLRC. /etitioners% instead of Aling an answer to the com-laint% they Aled a 5otion to Dismiss on the gro,nds of -rescri-tion% lac1 of C,risdiction and -remat,rity. /etitioners contended that the action has already -rescri+ed +eca,se it was Aled three years% seven months and (( days from the time the deceased seafarer reached the -oint of hire. 3SSUB* 2hether or not the action has -rescri+ed. SC RUL3NG* The action has not yet -rescri+ed. The em-loyment contract signed +y .,liano stated that EU-on a--roval% the same shall +e deemed an integral -art of the Standard Bm-loyment Contract ;SBC< for seafarers.E' Section (' of the /?B& SBC states* SE')+,( 34! ;<R+S"+')+,( )he Philippine ,%erseas Employment Administration (P,EA) or the (ational Laor Relations 'ommission ((LR') shall ha%e original and e8clusi%e $urisdiction o%er any and all disputes or contro%ersies arising out of or y %irtue of this 'ontract!Recogni:ing the peculiar nature of o%erseas shipoard employment0 the employer and the seafarer agree that all claims arising from this contract shall e made within one (=) year from the date of the seafarer>s return to the point of hire! ?n the other hand% the La+or Code states* AR)! 3?=! &oney claims! @ All money claims arising from employer*employee relations accruing during the eAecti%ity of this 'ode shall e 2led within three (B) years from the time the cause of action accrued7 otherwise they shall fore%er e arred! 3n So,theastern Shi--ing v. Navarra% .r.% we r,led that E&rticle (" is the law governing the -rescri-tion of money claims of seafarers% a class of overseas contract wor1ers. This law -revails over Section (' of the Standard Bm-loyment Contract for Seafarers which -rovides for claims to +e +ro,ght only within one year from the date of the seafarer6s ret,rn to !' F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch the -oint of hire.E 2e f,rther declared that Efor the g,idance of all% Section (' of the Standard Bm-loyment Contract for Seafarers% insofar as it limits the -rescri-tive -eriod within which the seafarers may Ale their money claims% is here+y declared n,ll and void. The a--lica+le -rovision is &rticle (" of the La+or Code% it +eing more favora+le to the seafarers and more in accord with the State6s declared -olicy to aJord f,ll -rotection to la+or. The -rescri-tive -eriod in the -resent case is th,s three years from the time the ca,se of action accr,es.E 3n the -resent case% the ca,se of action accr,ed on &,g,st (P% ($$ when .,liano died. =ence% the claim has not yet -rescri+ed% since the com-laint was Aled with the ar+itration +ranch of the NLRC on Se-tem+er @% ($$:. The -etition was dismissed. UNIVERSITY OF EAST vs. UNIVERSITY OF EAST EMPLOYEES ASSOCIATION G.R. No. P"#":% SB/TB5BBR @% ($ )&CTS* /etitioner University of the Bast ;UB< is an ed,cational instit,tion d,ly organiRed and e7isting ,nder /hili--ine laws. ?n the other hand% res-ondent University of the Bast Bm-loyees6 &ssociation ;UBB&< is a d,ly registered la+or ,nion of the ran10and0Ale em-loyees of UB. 3t a--ears from the records that -rior to school year ;SS< "':0"'@% the P$Q incremental -roceeds from t,ition fee increases as mandated +y /residential Decree No. @# ;/.D. No. @#<% as amended% was distri+,ted +y UB in -ro-ortion to the average n,m+er of academic and non0academic -ersonnel. The distri+,tion scheme +ecame the s,+Cect of an &greement dated ?cto+er '% "': signed +y the management% fac,lty association and res-ondent. Starting SS ""@0""#% however% the P$Q incremental -roceeds from the t,ition fee increase was distri+,ted +y UB to its covered em-loyees +ased on a new form,la of -ercentage of salary. Not in conformity% UBB&% thr, its -resident Brnesto C. 4erceles ;4erceles<% sent a letterdated Decem+er ((% ""@ to then UB /resident% Dr. Rosalina S. CaC,com ;Dr. CaC,com<% 8,estioning the manner of distri+,tion of the em-loyees6 share in the ""@0""# t,ition fee increase. ?n )e+r,ary (:% ""#% UBB& sent another letter to the UB /resident reiterating its earlier o+Cection to the distri+,tion scheme of the P$Q incremental -roceeds from the t,ition fee increase and re8,ested a tri-artite conference among management% fac,lty% administration% and ran10and0Ale re-resentatives to address the iss,e. ?n .,ne "% ""#% a tri-artite meeting was held among the re-resentatives of management% fac,lty ,nion and UBB&. 3n the said meeting% it was agreed that the distri+,tion of the incremental -roceeds wo,ld now +e +ased on -ercentage of salary% and not anymore on the average n,m+er of -ersonnel. The 5in,tesof the .,ne "% ""# meeting was signed and attested to +y UBB& o9cers who attended. ?n &-ril (P% """% UBB& Aled a com-laint +efore the NLRC for non0-ayment>,nder-ayment of the ran10 and0Ale em-loyees6 share of the t,ition fee increases against UB -,rs,ant to /.D. No. @#% as amended% and Re-,+lic &ct ;R.&.<No. !P(' otherwise 1nown as Government &ssistance to St,dents and Teachers in /rivate Bd,cation &ct. 3SSUBS* 2hether or not the change in the scheme of distri+,tion of the incremental -roceeds from t,ition fee increase is a dimin,tion of +eneAtD and 2hether or not the claim has -rescri+ed. SC RUL3NG* No. The Co,rt agrees with -etitioner UB that the change in the distri+,tion of the P$Q incremental -roceeds from t,ition fee increase from e8,al sharing to -ercentage of salaries is not a dimin,tion of +eneAts. 3ts distri+,tion to covered em-loyees +ased on e8,al sharing scheme cannot +e considered to have ri-ened into a com-any -ractice that the res-ondents have a right to demand. Generally% em-loyees have a vested right over e7isting +eneAts vol,ntarily granted to them +y their em-loyer% th,s% said +eneAts cannot +e red,ced% diminished% discontin,ed or eliminated +y the latter. This -rinci-le against dimin,tion of +eneAts% however% is a--lica+le only if the grant or +eneAt is fo,nded on an e7-ress -olicy or has ri-ened into a -ractice over a long -eriod of time which is consistent and deli+erate. 3t does not contem-late the contin,o,s grant of ,na,thoriRed or irreg,lar com-ensation +,t it -res,--oses that a com-any -ractice% -olicy and tradition favo,ra+le to the em-loyees has +een clearly esta+lishedD and that the -ayments made +y the com-any -,rs,ant to it have ri-ened into +eneAts enCoyed +y them. 3n the case at +ench% contrary to UBB&6s claim% the distri+,tion of the P$Q incremental -roceeds +ased on e8,al sharing scheme cannot +e held to !" F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch have ri-ened into a com-any -ractice that the res-ondents have a right to demand. Ses% the claim has -rescri+ed. The Co,rt agrees with UB and holds that UBB&6s right to 8,estion the distri+,tion of the incremental -roceeds for SS ""@0""# has already -rescri+ed. &rticle (" of the La+or Code -rovides that money claims arising from an em-loyer0em-loyee relationshi- m,st +e Aled within three ;:< years from the time the ca,se of action accr,ed. 3n the -resent case% the ca,se of action accr,ed when the distri+,tion of the incremental -roceeds +ased on -ercentage of salary of the covered em-loyees was disc,ssed in the tri-artite meeting held on .,ne "% ""#. UBB& did not 8,estion the manner of its distri+,tion and only on &-ril (P% """ did it Ale an action +ased therein. =ence% -rescri-tion had set in. XIX. JURISDICTION OF THE LA XX. 2011 NLRC RULES RODOLFO LUNA, vs. ALLADO CONSTRUCTION CO., INC., a*+(,- RAMON ALLADO% G.R. N?. P#(#% 5&S :$% ($ )&CTS* /etitioner L,na was the em-loyee of the constr,ctions com-any of the Res-ondent. =e was assigned in Saranggani /rovince. &s he was ca,ght -ilfering the res-ondentIs -ro-erty% he was dismissed from his em-loyment% and there+y Aled a case of illegal dismissal against the res-ondent. The La+or &r+iter r,led that there was no illegal dismissal% +,t awarded Anancial assistance in favo,r of the -etitioner. The res-ondent then a--ealed to the NLRC 8,estioning solely the L&Is decision in awarding Anancial assistance. The NLRC reversed the L&Is decision% Anding o,t that there was illegal dismissal and awarded the +ac1wages to the -etitioner. &ggrieved +y s,ch an ,nfavo,ra+le decision% the res-ondent via R,le !# -osed in its a--eal the validity of the NLRCIs decision on the gro,nd that it has no C,risdiction to entertain 8,estions not alleged in the a--eal. The res-ondentIs gro,nd was only 8,estioning the -ro-riety of the award of the Anancial assistance% yet NLRC entertained iss,es other than that -osed in the a--eal. 2ith the same adverse decision +y the C&% the res-ondents came +efore the SC via -etition for certiorari still 8,estioning the validity of the decision. Res-ondent arg,ed that the NLRC does not have a,thority to review iss,es not +ro,ght +efore it for a--eal. 3SSUB* 2?N the NLRC has C,risdiction to review iss,es not +ro,ght +efore it for a--eal SC RUL3NG* N?. Section @;c<% R,le 43 of the ($$( R,les of /roced,re of the NLRC% which was in eJect at the time res-ondents a--ealed the La+or &r+iterIs decision% e7-ressly -rovided that% on a--eal% the NLRC shall limit itself only to the s-eciAc iss,es that were elevated for review% to wit* R<LE C+ Appeals Section D!ReEuisites for Perfection of Appeal! 8 8 8 8 (c) Su$ect to the pro%isions of Article 3=40 once the appeal is perfected in accordance with these Rules0 the 'ommission shall limit itself to re%iewing and deciding speci2c issues that were ele%ated on appeal! (Emphasis supplied!) &s a testament to its eJectivity and the NLRCIs contin,ed im-lementation of this -roced,ral -olicy% the same -rovision was retained as Section @;d<% R,le 43 of the ($$# Revised R,les of /roced,re of the NLRC. 3n the case at +ar% the NLRC evidently went against its own r,les of -roced,re when it -assed ,-on the iss,e of illegal dismissal altho,gh the 8,estion raised +y res-ondents in their a--eal was concerned solely with the legality of the la+or ar+iterIs award of Anancial assistance des-ite the Anding that -etitioner was lawf,lly terminated. &n a--eal from a decision% award or order of the la+or ar+iter m,st +e +ro,ght to the NLRC within ten ;$< calendar days from recei-t of s,ch decision% award or order% otherwise% the same +ecomes Anal and e7ec,tory M&rt. ((:% La+or CodeD R,le 4333% Sec. ;a<% Revised R,les of the NLRCN. 5oreover% the r,les of the NLRC e7-ressly -rovide that on a--eal% the Commission shall limit itself only to the s-eciAc iss,es that were elevated for review% all other matters +eing Anal and e7ec,tory MR,le 4333% Sec. #;c<% Revised R,les of the NLRC% italics s,--liedN. P$ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch 3n the -resent case% -etitioner% aggrieved +y the la+or ar+iterIs decision ordering the e7tension of Anancial assistance to Galagar des-ite the Anding that his termination was for C,st ca,se% s-eciAcally limited his a--eal to a single legal 8,estion% i.e.% the validity of the award of Anancial assistance to an em-loyee dismissed for -ilfering com-any -ro-erty. ?n the other hand% -rivate res-ondent did not a--eal. 2hen -etitioner limited the iss,e on a--eal% necessarily the NLRC may review only that iss,e raised. &ll other matters% incl,ding the iss,e of the validity of -rivate res-ondentIs dismissal% are Anal. 3f -rivate res-ondent wanted to challenge the Anding of a valid dismissal% he sho,ld have a--ealed his case seasona+ly to the NLRC. By raising new iss,es in the re-ly to a--eal% -rivate res-ondent is in eJect a--ealing his case altho,gh he has% in fact% allowed his case to +ecome Anal +y not a--ealing within the reglementary -eriod. & re-ly>o--osition to a--eal cannot ta1e the -lace of an a--eal. Therefore% in this case% the dismissal of the com-laint for illegal dismissal and the denial of the -rayer for reinstatement% having +ecome Anal% can no longer +e reviewed. The La+or Code -rovision% read in its entirety% states that the NLRCIs -ower to correct errors% whether s,+stantial or formal% may +e e7ercised only in the determination of a 8,estion% matter or controversywithin its C,risdiction M&rt. ('% La+or CodeN. Therefore% +y considering the arg,ments and iss,es in the re-ly>o--osition to a--eal which were not -ro-erly raised +y timely a--eal nor com-rehended within the sco-e of the iss,e raised in -etitionerIs a--eal% -,+lic res-ondent committed grave a+,se of discretion amo,nting to e7cess of C,risdiction. The contention that the NLRC may nevertheless loo1 into other iss,es altho,gh not raised on a--eal since it is not +o,nd +y technical r,les of -roced,re% is li1ewise devoid of merit. The law does not -rovide that the NLRC is totally free from Etechnical r,les of -roced,reE% +,t only that the r,les of evidence -revailing in co,rts of law or e8,ity shall not +e controlling in -roceedings +efore the NLRC M&rt. ((% La+or CodeN. This is hardly license for the NLRC to disregard and violate the im-lementing r,les it has itself -rom,lgated. =aving done so% the NLRC committed grave a+,se of discretion. BANAHAW BROADCASTING vs. PACANA III, ET. AL. G.R. N?. P!P:% 5&S :$% ($ )&CTS* ?n &,g,st ("% ""#% the D\2G -ersonnel ;/acana 333 et al.< Aled with the La+or &r+iter a com-laint for illegal dismissal% ,nfair la+or -ractice% reim+,rsement of ,n-aid Collective Bargaining &greement ;CB&< +eneAts% and attorneyIs fees against 3BC and BBC. ?n .,ne (% ""!% La+or &r+iter &+d,llah L. &l,g rendered his Decision awarding the D\2G -ersonnel a total of/(%$$(%#P.(' as ,n-aid CB& +eneAts consisting of ,n-aid wages and increases% :th month -ay% longevity -ay% sic1 leave cash conversion% rice and s,gar s,+sidy% retirement -ay% loyalty reward and se-aration -ay. The La+or &r+iter denied the other claims of the D\2G -ersonnel for Christmas +on,s% ed,cational assistance% medical chec10,- and o-tical e7-enses. Both sets of -arties a--ealed to the National La+or Relations Commission ;NLRC<. The NLRC iss,ed a resol,tion vacating the decision of the La+or &r+iter and remanded the case to ar+itration +ranch of origin. ?n ?cto+er #% ""'% La+or &r+iter Nicodem,s G. /alangan rendered a Decision adC,dging BBC to +e lia+le for the same amo,nt in the vacated Decision of La+or &r+iter &l,g. Both BBC and res-ondents a--ealed to the NLRC anew. 3n their a--eal% the D\2G -ersonnel reasserted their claim for the remaining CB& +eneAts not awarded to them% and alleged error in the rec1oning date of the com-,tation of the monetary award. BBC% in its own 5emorand,m of &--eal% challenged the monetary award itself% claiming that s,ch +eneAts were only d,e to 3BC% not BBC% em-loyees. 3n the same 5emorand,m of &--eal% BBC incor-orated a 5otion for the Recom-,tation of the 5onetary &ward ;of the La+or &r+iter<% in order that the a--eal +ond may +e red,ced. The NLRC iss,ed an ?rder denying the 5otion for the Recom-,tation of the 5onetary &ward. &ccording to the NLRC% s,ch recom-,tation wo,ld res,lt in the -remat,re resol,tion of the iss,e raised on a--eal. The NLRC ordered BBC to -ost the re8,ired +ond within $ days from recei-t of said ?rder% with a warning that noncom-liance will ca,se the dismissal of the a--eal for non0-erfection. 3nstead of com-lying with the ?rder to -ost the re8,ired +ond% BBC Aled a 5otion for Reconsideration% alleging this time that since it is wholly owned +y the Re-,+lic of the /hili--ines% it need not -ost an a--eal +ond. 3SSUB* 2hether or not Banahaw Broadcasting Cor-oration ;BBC<% a Government ?wned and Controlled Cor-oration is e7em-t from -osting an a--eal +ond P F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch SC RUL3NG* 2e can infer from the foregoing C,ris-r,dential -recedents that% as a general r,le% the government and all the attached agencies with no legal -ersonality distinct from the former are e7em-t from -osting a--eal +onds% whereas government0owned and controlled cor-orations ;G?CCs< are not similarly e7em-ted. This distinction is +ro,ght a+o,t +y the very reason of the a--eal +ond itself* to -rotect the -res,m-tive C,dgment creditor against the insolvency of the -res,m-tive C,dgment de+tor. 2hen the State litigates% it is not re8,ired to -,t ,- an a--eal +ond +eca,se it is -res,med to +e always solvent. This e7em-tion% however% does not% as a general r,le% a--ly to G?CCs for the reason that the latter has a -ersonality distinct from its shareholders. 3n the case at +ar% BBC was organiRed as a -rivate cor-oration% se8,estered in the "'$Is and the ownershi- of which was s,+se8,ently transferred to the government in a com-romise agreement. ),rther% it is stated in its &mended &rticles of 3ncor-oration that BBC has the following -rimary f,nction* )o engage in commercial radio and tele%ision roadcasting0 and for this purpose0 to estalish0 operate and maintain such stations0 oth terrestrial and satellite or interplanetary0 as may e necessary for roadcasting on a network wide or international asis! 3t is therefore crystal clear that BBCIs f,nction is -,rely commercial or -ro-rietary and not governmental. &s s,ch% BBC cannot +e deemed entitled to an e7em-tion from the -osting of an a--eal +ond. Conse8,ently% the NLRC did not commit an error% and m,ch less grave a+,se of discretion% in dismissing the a--eal of BBC on acco,nt of non0 -erfection of the same. SOCIAL SECURITY COMMISSION, vs. RI&AL POULTRY a*+ LIVESTOCK ASSOCIATION, INC., BSD AGRO INDUSTRIAL DEVELOPMENT CORPORATION a*+ BENAMIN SAN DIEGO% G.R. No. !P$#$% .,ne % ($ )&CTS* The instant case stemmed from a -etition Aled +y &l+erto &ngeles ;&ngeles< +efore the Social Sec,rity Commission ;SSC< to com-el res-ondents RiRal /o,ltry and Livestoc1 &ssociation% 3nc. ;RiRal /o,ltry< or BSD &gro 3nd,strial Develo-ment Cor-oration ;BSD &gro< to remit to the Social Sec,rity System ;SSS< all contri+,tions d,e for and in his +ehalf. &ngeles had earlier Aled a com-laint for illegal dismissal against BSD &gro and>or its owner% BenCamin San Diego ;San Diego<. The La+or &r+iter initially fo,nd that &ngeles was an em-loyee and that he was illegally dismissed. ?n a--eal% however% the NLRC reversed the La+or &r+iterIs Decision and held that no em-loyer0em-loyee relationshi- e7isted +etween &ngeles and res-ondents. The r,ling was anchored on the Anding that the d,ties -erformed +y &ngeles% s,ch as car-entry% -l,m+ing% -ainting and electrical wor1s% were not inde-endent and integral ste-s in the essential o-erations of the com-any% which is engaged in the -o,ltry +,siness. &ngeles elevated the case to the Co,rt of &--eals via -etition for certiorari. The a--ellate co,rt a9rmed the NLRC r,ling and ,-held the a+sence of em-loyer0em-loyee relationshi-. &ngeles moved for reconsideration +,t it was denied +y the Co,rt of &--eals. No f,rther a--eal was ,nderta1en% hence% an entry of C,dgment was made on (! 5ay ($$. &t any rate% the SSC did not ta1e into consideration the decision of the NLRC. 3t denied res-ondentsI motion to dismiss in an ?rder dated " )e+r,ary ($$(. The SSC ratiocinated% th,s* Decisions of the NLRC and other tri+,nals on the iss,e of e7istence of em-loyer0em-loyee relationshi- +etween -arties are not +inding on the Commission. &t most% s,ch Anding has only a -ers,asive eJect and does not constit,te res C,dicata as a gro,nd for dismissal of an action -ending +efore Us. 2hile it is tr,e that the -arties +efore the NLRC and in this case are the same% the iss,es and s,+Cect matter are entirely diJerent. The la+or case is for illegal dismissal with demand for +ac1wages and other monetary claims% while the -resent action is for remittance of ,n-aid SSMSN contri+,tions. 3n other words% altho,gh in +oth s,its the res-ondents invo1e lac1 of em-loyer0em-loyee relationshi-% the same does not -roceed from identical ca,ses of action as one is for violation of the La+or Code while the instant case is for violation of the SSMSN Law. Res-ondents so,ght reco,rse +efore the Co,rt of &--eals +y way of a -etition for certiorari. The Co,rt of &--eals reversed the r,lings of the SSC and held that there is a common iss,e +etween the cases +efore the SSC and in the NLRCD and it is whether there e7isted an em-loyer0em-loyee relationshi- +etween &ngeles and res-ondents. Th,s% the case falls s8,arely ,nder the -rinci-le of res C,dicata% -artic,larly ,nder the r,le on concl,siveness of C,dgment% as en,nciated in Smith Bell and Co. v. Co,rt of &--eals. P( F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch 3SSUB* 2=BT=BR ?R N?T T=B DBC3S3?N ?) T=B NLRC &ND T=B C?URT ?) &//B&LS% )3ND3NG N? B5/L?SBR0B5/L?SBB RBL&T3?NS=3/% C?NST3TUTBS RBS .UD3C&T& &S & RULB ?N C?NCLUS34BNBSS ?) .UDG5BNT &S T? /RBCLUDB T=B RBL3T3G&T3?N ?) T=B 3SSUB ?) B5/L?SBR0B5/L?SBB RBL&T3?NS=3/ 3N & SUBSBYUBNT C&SB )3LBD BB)?RB T=B /BT3T3?NBR. SC RUL3NG* The elements of res C,dicata are* ;< the C,dgment so,ght to +ar the new action m,st +e AnalD ;(< the decision m,st have +een rendered +y a co,rt having C,risdiction over the s,+Cect matter and the -artiesD ;:< the dis-osition of the case m,st +e a C,dgment on the meritsD and ;@< there m,st +e as +etween the Arst and second action% identity of -arties% s,+Cect matter% and ca,ses of action. Sho,ld identity of -arties% s,+Cect matter% and ca,ses of action +e shown in the two cases% then res C,dicata in its as-ect as a E+ar +y -rior C,dgmentE wo,ld a--ly. 3f as +etween the two cases% only identity of -arties can +e shown% +,t not identical ca,ses of action% then res C,dicata as Econcl,siveness of C,dgmentE a--lies. 4erily% the -rinci-le of res C,dicata in the mode of Econcl,siveness of C,dgmentE a--lies in this case. The Arst element is -resent in this case. The NLRC r,ling was a9rmed +y the Co,rt of &--eals. 3t was a C,dicial a9rmation thro,gh a decision d,ly -rom,lgated and rendered Anal and e7ec,tory when no a--eal was ,nderta1en within the reglementary -eriod. The C,risdiction of the NLRC% which is a 8,asi0C,dicial +ody% was ,ndis-,ted. Neither can the C,risdiction of the Co,rt of &--eals over the NLRC decision +e the s,+Cect of a dis-,te. The NLRC case was clearly decided on its meritsD li1ewise on the merits was the a9rmance of the NLRC +y the Co,rt of &--eals. 2ith res-ect to the fo,rth element of identity of -arties% we hold that there is s,+stantial com-liance. The -arties in SSC and NLRC cases are not strictly identical. RiRal /o,ltry was im-leaded as additional res-ondent in the SSC case. .,ris-r,dence however does not dictate a+sol,te identity +,t only s,+stantial identity. There is s,+stantial identity of -arties when there is a comm,nity of interest +etween a -arty in the Arst case and a -arty in the second case% even if the latter was not im-leaded in the Arst case. & case in -oint is Smith Bell and Co. v. Co,rt of &--eals(# which% contrary to SSC% is a-t and -ro-er reference. Smith Bell availed of the services of -rivate res-ondents to trans-ort cargoes from the -ier to the com-any6s wareho,se. Cases were Aled against Smith Bell% one for illegal dismissal +efore the NLRC and the other one with the SSC% to direct Smith Bell to re-ort all -rivate res-ondents to the SSS for coverage. 2hile the SSC case was -ending +efore the Co,rt of &--eals% Smith Bell -resented the resol,tion of the S,-reme Co,rt in G.R. No. L0@@!($% which a9rmed the NLRC% Secretary of La+or% and Co,rt of &--ealsI Anding that no em-loyer0 em-loyee relationshi- e7isted +etween the -arties% to constit,te as +ar to the SSC case. 2e granted the -etition of Smith Bell and ordered the dismissal of the case. 2e held that the controversy is s8,arely covered +y the -rinci-le of res C,dicata% -artic,larly ,nder the r,le on Econcl,siveness of C,dgment.E Therefore% the C,dgment in G.R. No. L0@@!($ +ars the SSC case% as the relief so,ght in the latter case is ine7trica+ly related to the r,ling in G.R. No. L0@@!($ to the eJect that -rivate res-ondents are not em-loyees of Smith Bell. UNIVERSITY PLANS INCORPORATED% vs. BELINDA P. SOLANO, TERRY A. LAMUG, GLENDA S. BELGA, MELBA S. ALVARE&, WELMA R. NAMATA, MARIETTA D. BACHO a*+ MANOLO L. CENIDO% G.R. No. P$@!% .UNB ((% ($ )&CTS* Res-ondents Aled +efore the La+or &r+iter com-laints for illegal dismissal% illegal ded,ctions% overriding commissions% ,nfair la+or -ractice% moral and e7em-lary damages% and act,al damages against -etitioner University /lans 3ncor-orated. The La+or &r+iter fo,nd -etitioner g,ilty of illegal dismissal and ordered res-ondents6 reinstatement as well as the -ayment of their f,ll +ac1wages% -ro-ortionate :th month -ay% moral>e7em-lary damages% and attorney6s fees. /etitioner a--ealed the Decision of the L& to the NLRC and Aled its 5emorand,m on &--eal as well as a 5otion to Red,ce Bond. Sim,ltaneo,s with the Aling of said -leadings% it -osted a cash +ond in the amo,nt of /:$%$$$.$$. P: F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch 3n its 5otion to Red,ce Bond% -etitioner alleged that it was ,nder receivershi- and that it cannot dis-ose of its assets at s,ch a short notice. Beca,se of this% it co,ld not -ost the re8,ired +ond. Nevertheless% it has /:$%$$$.$$ availa+le for immediate dis-osition and th,s -rayed that said amo,nt +e deemed s,9cient to satisfy the re8,ired +ond for the -erfection of its a--eal. The NLRC denied -etitioner6s 5otion to Red,ce Bond and directed it to -ost an additional a--eal +ond in the amo,nt of /:%$:%#"".#$ within an ,ne7tendi+le -eriod of $ days from notice% otherwise the a--eal shall +e dismissed for non0-erfection. The NLRC denied -etitioner6s motion for reconsideration ratiocinating that while it has the discretion to red,ce the a--eal +ond% it is nevertheless not -ers,aded that -etitioner was inca-a+le of -osting the re8,ired +ond. 3t noted that -etitioner failed to s,+mit any Anancial statement or -rovide details anent its alleged receivershi- or its so,rces of income. UnsatisAed% -etitioner went to the C& thro,gh a /etition for Certiorari. The C& ,-held the NLRC Resol,tion. 3SSUB* 2hether or not the NLRC erred in not considering the merit or lac1 of merit of -etitionerIs 5otion to Red,ce Bond. SC RUL3NG* There is merit in the -etition. The NLRC erred in not considering the merit or lac1 of merit of -etitioner6s 5otion to Red,ce Bond. /etitioner attached to its 5otion to Red,ce Bond the SBC ?rders dated &,g,st (:% """ and 5ay (:% ($$$. The ?rder of &,g,st (:% """ is a Cease and Desist ?rder which% among others% -rohi+ited the o9cers and agents of -etitioner from withdrawing from its tr,st f,nds or from ma1ing any dis-osition thereof and% ordered the freeRe of all its assets and -ro-erties. ?n the other hand% the 5ay (:% ($$$ ?rder -laced U/3% 3nc. ,nder the management and control of a RBCB34BR. )rom the said SBC ?rders% it is ,nmista1a+le that -etitioner was ,nder receivershi-. &nd from the tenor and contents of said ?rders% it is -ossi+le that -etitioner has no li8,id asset which it co,ld ,se to -ost the re8,ired amo,nt of +ond. &lso% it is 8,ite ,nderstanda+le that +eca,se of -etitioner6s Anancial state% it cannot raise the amo,nt of more than /: million within a -eriod of $ days from recei-t of the La+or &r+iter6s C,dgment. =owever% the NLRC ignored -etitioner6s allegations and instead remained adamant that since the amo,nt of +ond is A7ed +y law% -etitioner m,st -ost an additional +ond of more than /: million. This% to ,s% is an ,tter disregard of the -rovision of the La+or Code and of the NLRC Revised R,les of /roced,re allowing the red,ction of +ond in meritorio,s cases. 2hile the NLRC tried to correct this error in its 5arch (% ($$: Resol,tion +y f,rther e7-laining that it was not -ers,aded +y -etitioner6s alleged inca-a+ility of -osting the re8,ired amo,nt of +ond for fail,re to s,+mit Anancial statement% list of so,rces of income and other details with res-ect to the alleged receivershi-% we still And the hasty denial of the motion to red,ce +ond not -ro-er. Notwithstanding -etitioner6s fail,re to s,+mit its Anancial statement and list of so,rces of income and to give more details relative to its receivershi-% it was nevertheless a+le to show thro,gh the a+ovementioned SBC ?rders that it was indeed ,nder a state of receivershi-. This sho,ld have +een s,9cient reason for the NLRC to not o,trightly deny -etitioner6s motion. &s to the lac1ing doc,ments and details on the receivershi-% it is tr,e that they are needed +y the NLRC in determining -etitioner6s ca-acity to -ost the re8,ired amo,nt of +ond. =owever% their a+sence sho,ld not lead to the o,tright denial of the motion since as earlier disc,ssed% the NLRC is not -recl,ded from cond,cting a -reliminary determination on the merit or lac1 of merit of a motion to red,ce +ond. =ere% considering the clear showing of -etitioner6s state of receivershi-% the NLRC sho,ld have cond,cted s,ch -reliminary determination and therein re8,ire the s,+mission of said doc,ments and other necessary evidence +efore -roceeding to resolve the s,+Cect motion. &fter all% the -resent case falls ,nder those cases where the +ond re8,irement on a--eal may +e rela7ed considering that ;< there was s,+stantial com-liance with the R,lesD ;(< the s,rro,nding facts and circ,mstances constit,te meritorio,s gro,nds to red,ce the +ondD and ;:< the -etitioner% at the very least% e7hi+ited its willingness and>or good faith +y -osting a -artial +ond d,ring the reglementary -eriod. &lso% s,ch a -roced,re wo,ld +e in 1ee-ing with the La+or Code6s mandate to ,se every and all reasona+le means to ascertain the facts in each case s-eedily and o+Cectively% witho,t regard to technicalities of law or -roced,re% all in the interest of d,e -rocess. 2e th,s And error on the -art of the NLRC when it denied -etitioner6s 5otion to P@ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch Red,ce Bond and li1ewise on the -art of the C& when it a9rmed said denial. 3n view of the foregoing% a remand of this case to the NLRC for the cond,ct of -reliminary determination of the merit or lac1 of merit of -etitioner6s 5otion to Red,ce Bond is -ro-er. BPI EMPLOYEES UNION . METRO MANILA a*+ &ENAIDA UY vs. BANK OF THE PHILIPPINE ISLANDS G.R. No. P'!""% SB/TB5BBR (% ($ )&CTS* /etitioner Uy was a +an1 teller of the res-ondent B/3. She was se-arated from her Co+ allegedly +eca,se of ins,+ordination% disres-ect and a+sence witho,t leave. She together with the Union% Aled a case for illegal dismissal against res-ondent in the 4ol,ntary &r+itrator. The 4& r,led in favo,r of her% ordering the res-ondent to reinstate her and award f,ll +ac1wages. Both a--ealed to the C& which a9rmed the 4&Is decision with modiAcations. Still ,nsatisAed% Uy and the Union went to SC and alleged that B/3Is remedy is not a certiorari -etition ,nder R,le !# of the R,les of Co,rt +,t an a--eal from C,dgments% Anal orders and resol,tions of vol,ntary ar+itrators ,nder R,le @: of the R,les of Co,rt. They also contended that B/3Is -etition is wanting in s,+stance. 3SSUB* 2?N B/3Is remedy of certiorari -etition ,nder R,le !# is -ro-er SC RUL3NG* SBS. Section % R,le @ of the R,les of Co,rt e7-licitly -rovides that no a--eal may +e ta1en from an order of e7ec,tion% the remedy of an aggrieved -arty +eing an a--ro-riate s-ecial civil action ,nder R,le !# of the R,les of Co,rt. Th,s% B/3 correctly availed of the remedy of certiorari ,nder R,le !# of the R,les of Co,rt when it assailed the Decem+er !% ($$# order of e7ec,tion of the 4ol,ntary &r+itrator. DUP SOUND PHILS. a*+(,- MANUEL TAN vs. COURT OF APPEALS a*+ CIRILO A. PIAL G.R. No. !':P% N?4B5BBR (% ($ )&CTS* /rivate res-ondent% /ial is an em-loyee of herein -etitioner DU/ So,nd /hils. ;DU/<D -etitioner Tan is the owner and manager of DU/. /ial was given the Co+ of Emastering ta-eED his main f,nction was to adC,st the so,nd level and intensity of the m,sic to +e recorded as well as arrange the se8,ence of the songs to +e recorded in the cassette ta-es. /ial got a+sent from wor1 +eca,se he got sic1. The following day when he was ready for wor1% he was informed +y the o9ce secretary not to re-ort for wor1 ,ntil s,ch time that they will advise him to do so. &fter three wee1s witho,t receiving any notice% /ial again called ,- their o9ce. This time the o9ce secretary advised him to loo1 for another Co+ +eca,se% -er instr,ction of Tan% he is no longer allowed to wor1 at DU/. /ial Aled a com-laint for illegal dismissal and -rayed for the -ayment of his ,n-aid service incentive leave -ay% f,ll +ac1wages% se-aration -ay% moral and e7em-lary damages as well as attorney6s fees. /etitioners DU/ and Tan denied the material allegations of /ialD that the latter failed to re-ort for wor1 following an altercation with his s,-ervisor the -revio,s day and that /ial called ,- their o9ce and informed the o9ce secretary that he will +e going +ac1 to wor1 on Se-tem+er P% ($$. =owever% he failed to re-ort for wor1 on the said date. /etitioners were s,+se8,ently s,r-rised when they learned that /ial Aled a com-laint for illegal dismissal against themD /ial was never dismissed% instead% it was his ,nilateral decision not to wor1 at DU/ anymore. The La+or &r+iter rendered a decision declaring /ial to have +een illegally dismissed and ordering DU/ and Tan to reinstate him to his former -osition and -ay him +ac1wages% cost of living allowance% service incentive leave -ay and attorney6s fees. ?n a--eal% the NLRC modiAed the decision +y deleting the award of +ac1wages and attorney6s fees. The NLRC r,led that there was no illegal dismissal on the -art of DU/ and Tan% +,t neither was there a+andonment on the -art of /ial. /ial then Aled a s-ecial civil action for certiorari with the C&. The C& set aside the decision of the NLRC and reinstated the decision of the L&. 3SSUB* 2hether or not /ial was illegally dismissed. SC RUL3NG* This Co,rt cannot give credence to -etitioners6 claim that -rivate res-ondent a+andoned his Co+. /ial was illegally dismissed. The settled r,le in la+or cases is that the em-loyer has the +,rden of -roving that the P# F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch em-loyee was not dismissed% or% if dismissed% that the dismissal was not illegal% and fail,re to discharge the same wo,ld mean that the dismissal is not C,stiAed and% therefore% illegal.3n the instant case% what +etrays -etitioners6 claim that -rivate res-ondent was not dismissed from his em-loyment +,t instead a+andoned his Co+ is their fail,re to -rove that the latter indeed sto--ed re-orting for wor1 witho,t any C,stiAa+le ca,se or a valid leave of a+sence. 3f -rivate res-ondent indeed a+andoned his Co+% -etitioners sho,ld have aJorded him d,e -rocess +y serving him written notices% as well as a chance to e7-lain his side% as re8,ired +y law. 3t is settled that% -roced,rally% if the dismissal is +ased on a C,st ca,se ,nder &rticle ('( of the La+or Code% the em-loyer m,st give the em-loyee two written notices and a hearing or o--ort,nity to +e heard if re8,ested +y the em-loyee +efore terminating the em-loyment* a notice s-ecifying the gro,nds for which dismissal is so,ght% a hearing or an o--ort,nity to +e heard and% after hearing or o--ort,nity to +e heard% a notice of the decision to dismiss. &gain% -etitioners failed to do these. Th,s% the foregoing +olsters -rivate res-ondent6s claim that he did not a+andon his wor1 +,t was% in fact% dismissed. Neither may -rivate res-ondent6s ref,sal to re-ort for wor1 s,+se8,ent to the L&6s iss,ance of an order for his reinstatement +e considered as another a+andonment of his Co+. 3t is a settled r,le that fail,re to re-ort for wor1 after a notice to ret,rn to wor1 has +een served does not necessarily constit,te a+andonment. &s deAned ,nder esta+lished C,ris-r,dence% a+andonment is the deli+erate and ,nC,stiAed ref,sal of an em-loyee to res,me his em-loyment. 3t is a form of neglect of d,ty% hence% a C,st ca,se for termination of em-loyment +y the em-loyer. )or a valid Anding of a+andonment% these two factors sho,ld +e -resent* ;< the fail,re to re-ort for wor1 or a+sence witho,t valid or C,stiAa+le reasonD and ;(< a clear intention to sever em-loyer0em-loyee relationshi-% with the second as the more determinative factor which is manifested +y overt acts from which it may +e ded,ced that the em-loyee has no more intention to wor1. The intent to discontin,e the em-loyment m,st +e shown +y clear -roof that it was deli+erate and ,nC,stiAed. 3n the instant case% -rivate res-ondent claimed that his s,+se8,ent ref,sal to re-ort for wor1 des-ite the La+or &r+iter6s order for his reinstatement is d,e to the fact that he was s,+se8,ently made to -erform the Co+ of a E+odegeroE of which he is ,nfamiliar and which is totally diJerent from his -revio,s tas1 of Emastering ta-e.E 5oreover% he was assigned to a diJerent wor1-lace% which is a wareho,se% where he was isolated from all other em-loyees. The Co,rt notes that -etitioners failed to ref,te the foregoing claims of -rivate res-ondent Under the e7isting law% an em-loyee who is ,nC,stly dismissed from wor1 shall +e entitled to reinstatement witho,t loss of seniority rights. &rticle (P" of the La+or Code clearly -rovides that an em-loyee who is dismissed witho,t C,st ca,se and witho,t d,e -rocess is entitled to +ac1wages and reinstatement or -ayment of se-aration -ay in lie, thereof. &rticle ((: of the same Code also -rovides that an em-loyee entitled to reinstatement shall either +e admitted +ac1 to wor1 ,nder the same terms and conditions -revailing -rior to his dismissal or se-aration% or% at the o-tion of the em-loyer% merely reinstated in the -ayroll. 3t is esta+lished in C,ris-r,dence that reinstatement means restoration to a state or condition from which one had +een removed or se-arated. The -erson reinstated ass,mes the -osition he had occ,-ied -rior to his dismissal. Reinstatement -res,--oses that the -revio,s -osition from which one had +een removed still e7ists% or that there is an ,nAlled -osition which is s,+stantially e8,ivalent or of similar nat,re as the one -revio,sly occ,-ied +y the em-loyee. This Co,rt has r,led in many instances that reinstatement is no longer via+le where% among others% the relations +etween the em-loyer and the em-loyee have +een so severely strained% that it is not in the +est interest of the -arties% nor is it advisa+le or -ractical to order reinstatement% or where the em-loyee decides not to +e reinstated. 3n the instant case% the res,lting circ,mstances show that reinstatement wo,ld +e im-ractical and wo,ld hardly -romote the +est interest of the -arties. Resentment and enmity +etween -etitioners and -rivate res-ondent necessarily strained the relationshi- +etween them or even -rovo1ed anti-athy and antagonism as shown +y the acts of the -arties s,+se8,ent to the order of reinstatement. Besides% -rivate res-ondent e7-ressly -rayed for an award of se-aration -ay in lie, of reinstatement from the very start of the -roceedings +efore the La+or &r+iter. By so doing% he forecloses reinstatement as a relief +y im-lication. 2here reinstatement is no longer via+le as an o-tion% se-aration -ay e8,ivalent to one ;< month salary for every year of service sho,ld +e awarded as an alternative. This has +een the consistent r,ling in the award of se-aration -ay to illegally dismissed em-loyees in lie, of reinstatement. P! F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch HYPTE R. AUERO VS. PHILIPPINE COMMUNICATIONS SATELLITE CORPORATION G.R. No. ":@'@% .&NU&RS '% ($( )&CTS* /etitioner started wor1ing for /hilcomsat in "!P as an acco,ntant. ?n &,g,st #% ($$ or after :@ years of service% he a--lied for early retirement and the same was a--roved on Se-tem+er #% ($$. D,ring that time% he was the Senior 4ice0/resident. =e e7ec,ted a Deed of Release andY,itclaim in /hilcomsatIs favor on Se-tem+er (% ($$( with arecei-t from the latter of a chec1 in the amo,nt of / "%@:"% :(P.".&fter almost : years% -etitioner Aled a com-laint for ,n-aid retirement +eneAts claiming that the act,al amo,nt of his retirement -ay is / @% $#% $##.$$ and the / "% @:"% :(P." that he received as s,--osed settlement is ,nconsciona+le. Th,s% his 8,itclaim m,st +e declared as n,ll and void. =e said that he had no choice +,t to acce-t said amo,nt +eca,se he was in dire need thereof and he was ready to ret,rn to his hometown so he signed the 8,itclaim des-ite the deAciency as no money wo,ld +e released if he did not e7ec,te a release and waiver in /hilcomsatIs favor. &ccording to him% the letterof /hilcomsatIschairman and -resident addressed to UC/B for the release of / "%@:"%:(P." to him and / @%#P#%P(P.$" to /hilcomsat% which -redated the e7ec,tion of his 8,itclaim% indicates thecom-anyIs -re0conceived -lans to de-rive him of a -ortion of his retirement -ay. The L& decided in favor of the -etitioner and ordered /hilcomsat to -ay him / @%#P#%P(P.$"and / (P@%'$#.$$ as +alance of his retirement +eneAts and salary for the -eriod from &,g,st # to Se-tem+er #% ($$. /etitionerIs com-laint for ,n-aidretirement +eneAts and salary was dismissed +eca,se he failed to -rove that /hilcomsat em-loyed means to vitiate his consent to the 8,itclaim. /hilcomsatIs a--eal to the NLRC from L&Is decision was Aled and its s,rety +ond -osted+eyond the -rescri+ed -eriod of $ days +,t since it was only one day delayed% the NLRC disregard the -roced,ral la-se U -roceeded with the a--eal. /etitioner later Aled for a -etition for certiorari acc,sing NRLC with grave a+,se of discretion for -roceeding des-ite res-ondentIs +elated a--eal. =e claimed that when /hilcomsat Aledits a--eal and -osted its s,rety +ond% L&Is decision +ecame Anal and e7ec,tory and the fail,re of /hilcomsatIs co,nsel to verify the co-y does not constit,te e7c,sa+le negligence. The C& however% fo,nd no merit in the claim of -etitioner and r,led that the NLRC was correct in ,-holding the validity of the 8,itclaim +eca,se the terms of the Deed of Release and Y,itclaim were reasona+le and there was no showing that /hilcomsat em-loyed coercion% fra,d or ,nd,e inT,ence ,-on -etitioner to com-el him to sign the same. 3SSUBS* . 2hether or notthe delay in the Aling of /hilcomsatIs a--eal and -osting of s,rety +ond isine7c,sa+leD and (. 2hether or notthe 8,itclaim e7ec,ted +y the -etitioner in /hilcomsatIs favor is valid% there+yforeclosing his right to instit,te any claim against /hilcomsat SC RUL3NG* The Co,rt r,lesin /hilcomsatIs favor since -roced,ral r,les may +e waived or dis-ensed with in a+sol,tely meritorio,s cases. &ccording to /hilcomsat% when -etitioner made the e7ec,tion of the 8,itclaim% it was vol,ntary. =is ed,cational attainment and the -osition he occ,-ied also militate against his claim that he was -ress,red or coerced into signing the 8,itclaim. &+sent any evidence that any vices of consent is -resent and considering the -etitionerIs -ositionand ed,cation% the 8,itclaim e7ec,ted +y the -etitioner constit,tes a valid and +inding agreement. Since -etitionerIs claim of fra,d and +ad faith against /hilcomsat is ,ns,+stantiated% this Co,rt th,s% Ands the 8,itclaim to +e legitimate waiver. The fact,al iss,es were determined +y the NLRC and were a9rmed +y the C&. /etition is denied. TIMOTEO H. SARONA VS.NATIONAL LABOR RELATIONS COMMISSION, ROYALE SECURITY AGENCY AND CESAR S. TAN G.R. No. '#('$% .&NU&RS '% ($( )&CTS* /etitioner% a sec,rity g,ard in Sce-tre since &-ril "P!% was as1ed +y Sce-treIs o-erations manager on .,ne ($$:% to s,+mit a resignation letter as a re8,irement for an a--lication in Royale and to All ,- an em-loyment a--lication form for the said com-any. =e was then assigned at =ighlight 5etal Craft 3nc. from .,ly (" to &,g,st '% ($$: and was later transferred to 2ide 2ide 2orld B7-ress 3nc. ?n Se-tem+er ($$:% he was informed that his assignment at 222B 3nc. was withdrawn +eca,se Royale has +een allegedly re-laced +y another sec,rity agency which he later discovered to +e ,ntr,e. Nevertheless% he was once again assigned at =ighlight 5etal sometime in Se-tem+er ($$: and when he re-orted at RoyaleIs o9ce on ?cto+er % ($$:% he was informed that he wo,ld no longer +e given any PP F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch assignment as instr,cted +y Sce-treIs general manager. =e th,s Aled a com-laint for illegal dismissal. The L& r,led in -etitionerIs favor as he fo,nd him illegally dismissed and was not convinced +y the res-ondentIs claim on -etitionerIs a+andonment. Res-ondents were ordered to -ay +ac1wages com-,ted from the day he was dismissed ,- to the -rom,lgation of his decision on 5ay % ($$#.The L& also ordered for the -ayment of se-aration -ay +,t ref,sed to -ierce RoyaleIs cor-orate veil. Res-ondents a--ealed to the NLRC claiming that the L& acted with grave a+,se of discretion ,-on r,ling on the illegal dismissal of -etitioner. NLRC -artially a9rmed the L&Is decision with regard to -etitionerIs illegal dismissal and se-aration -ay +,t modiAed the amo,nt of +ac1wages and limited it to only : months of his last month salary red,cing /"#% !$$ to /#% !$$ since he wor1ed for Royale for only month and : days. /etitioner did not a--eal to L& +,t raised the validity of L&Is Andings on -iercing RoyaleIs cor-orate -ersonality and com-,tation of his se-aration -ay and s,ch -etition was dismissed +y the NLRC. /etitioner elevated NLRCIs decision to the C& on a -etition for certiorari% and the C& disagreed with the NLRCIs decision of not -roceeding to review the evidence for determining if Royale is Sce-treIs alter ego that wo,ld warrant the -iercing of its cor-orate veil. 3SSUBS* 2hether or not RoyaleIs cor-orate Action sho,ld +e -ierced for the -,r-ose of com-elling it to recogniRe the -etitionerIs length of service with Sce-tre and for holding it lia+le for the +eneAts that have accr,ed to him arising from his em-loyment with Sce-treD and 2hether or not -etitionerIs +ac1wages sho,ld +e limited to his salary for : months SC RUL3NG* The doctrine of -iercing the cor-orate veil is a--lica+le on alter ego cases% where a cor-oration is merely a farce since it is a mere alter ego or +,siness cond,it of a -erson% or where the cor-oration is so organiRed and controlled and its aJairs are so cond,cted as to ma1e it merely an instr,mentality% agency% cond,it or adC,nct of another cor-oration. The way on how -etitioner was made to resign from Sce-tre then later on made an em-loyee of Royale% reTects the ,se of the legal Action of the se-arate cor-orate -ersonality and is an im-lication of contin,ed em-loyment. Royale is a contin,ation or s,ccessor or Sce-tre since the em-loyees of Sce-tre and of Royale are the same and said com-anies have the same -rinci-al -lace of +,siness. Beca,se -etitionerIs rights were violated and his em-loyer has not changed% he is entitled to se-aration -ay which m,st +e com-,ted from the time he was hired ,ntil the Anality of this decision. Royale is also ordered to -ay him +ac1wages from his dismissal on ?cto+er % ($$: ,ntil the Anality of this decision. =owever% the amo,nt already received +y -etitioner from the res-ondents shall +e ded,cted. =e is also awarded moral and e7em-lary damages amo,nting to / (#% $$$.$$ each for his dismissal which was tainted with +ad faith and fra,d. /etition is granted. C&Is decision is reversed and set aside. SALENGA, ET. AL., vs. CA G.R. No. P@"@% )BBRU&RS % ($( )&CTS* /resident>Chief B7ec,tive ?9cer ;CB?< R,fo Colayco iss,ed an ?rder informing -etitioner that% -,rs,ant to the decision of the +oard of directors of res-ondent CDC% the -osition of head e7ec,tive assistant the -osition held +y -etitioner was declared red,ndant. /etitioner Aled a Com-laint for illegal dismissal with a claim for reinstatement and -ayment of +ac1 wages% +eneAts% and moral and e7em-lary damages against res-ondent CDC and Colayco. Res-ondents% re-resented +y the ?9ce of the Government Cor-orate Co,nsel ;?GCC<% alleged that the NLRC had no C,risdiction to entertain the case on the gro,nd that -etitioner was a cor-orate o9cer and% th,s% his dismissal was an intra0cor-orate matter falling -ro-erly within the C,risdiction of the Sec,rities and B7change Commission ;SBC<. L& Darl,cio rendered a Decision in favor of -etitioner. )rom the decision% the ?CGCC Aled an a--eal with the National La+or Relations Commission ;NLRC< via a 5emorand,m of &--eal veriAed and certiAed +y =ilana Tim+ol0Roman% the e7ec,tive vice -resident of res-ondent CDC. The -etitioner o--osed the a--eal on the gro,nd that the 5emorand,m of &--eal and .oint &9davit were not accom-anied +y a +oard resol,tion from res-ondentIs +oard of directors a,thoriRing either Tim+ol0Roman or &tty. 5allare% or +oth% to -,rs,e the case or to Ale the a--eal on +ehalf of res-ondent. P' F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch 3SSUB* 2hether or not the NLRC has C,risdiction to entertain the a--eal. SC RUL3NG* NLRC has no C,risdiction to entertain the a--eal. 3t is clear from the NLRC R,les of /roced,re that a--eals m,st +e veriAed and certiAed against for,m0sho--ing +y the -arties0in0interest themselves. & cor-oration can only e7ercise its -owers and transact its +,siness thro,gh its +oard of directors and thro,gh its o9cers and agents when a,thoriRed +y a +oard resol,tion or its +ylaws. &+sent the re8,isite +oard resol,tion% neither Tim+ol0Roman nor &tty. 5allari% who signed the 5emorand,m of &--eal and .oint &9davit of Declaration allegedly on +ehalf of res-ondent cor-oration% may +e considered as the Ka--ellantO and Kem-loyerO referred to +y R,le 43% Sections @ to ! of the NLRC R,les of /roced,re. The co,rt cannot agree with the ?GCCIs attem-t to down-lay this -roced,ral Taw +y claiming that% as the stat,torily assigned co,nsel for G?CCs% it does not need s,ch a,thoriRation. 3n Constantino0David v. /angandaman0Gania% @#! /hil. (P:% ("@0("' ;($$:<% the co,rt e7ha,stively e7-lained why it was necessary for government agencies or instr,mentalities to e7ec,te the veriAcation and the certiAcation against for,m0sho--ing thro,gh their d,ly a,thoriRed re-resentatives. The -,r-ose of veriAcation is to sec,re an ass,rance that the allegations in the -leading are tr,e and correct and have +een Aled in good faith. Unless e8,ita+le circ,mstances which are manifest from the record of a case -revail% it therefore +ecomes necessary for the concerned government agency or its a,thoriRed re-resentatives to certify for non0for,m sho--ing if only to +e s,re that no other similar case or incident is -ending +efore any other co,rt. &nent the cor-orationIs lia+ility% the decision of the L& still stands. 3n the case at +ar% res-ondents failed to add,ce any evidence showing that the -osition of =ead B7ec,tive &ssistant is s,-erT,o,s. There is no evidence on record to show that the -osition of =ead B7ec,tive &ssistant was a+olished +y the Board of Directors in its meetings. =ence% the gro,nd of red,ndancy is merely a device made +y res-ondent Colayco in order to ease o,t the com-lainant from the res-ondent cor-oration. 5oreover% the com-lainant was not accorded his right to d,e -rocess -rior to his termination. =e was not given the o--ort,nity to +e heard and defend himself. =owever% the co,rt notes that with regards to res-ondent ColaycoIs solidary lia+ility with the cor-oration% -etitioner nota+ly in the case at hand% did not 8,estion the r,ling made +y NLRC in Anding that res-ondent Colayco may not +e held solidarily res-onsi+le to him. &s a res,lt% it dro--ed him as a res-ondent. Based on the foregoing% all other s,+se8,ent -roceedings regarding the iss,e of -etitionerIs dismissal are n,ll and void for having +een cond,cted witho,t C,risdiction. LOCKHEED DETECTIVE AND WATCHMAN AGENCY, INC vs. UNIVERSITY OF THE PHILIPPINES% G.R. No. '#"'% &/R3L '% ($( )&CTS* /etitioner entered into a contract for sec,rity services with res-ondent University of the /hili--ines and they were +oth s,ed +y several sec,rity g,ards in ""' for -ayment of ,nder-aid wages and other +eneAts. The la+or ar+iter fo,nd the claims meritorio,s and held +oth -etitioner and res-ondent solidarily lia+le as Co+ contractor and -rinci-al. U-on a--eal +y +oth% the decision was only modiAed +y dismissing some claims ;-remi,m -ay and service incentive leave -ay< for lac1 of +asis +,t they were still held solidarily lia+le. &n 5R on this was also denied +y the NLRC. The NLRC decision +ecame Anal and e7ec,tor on ($$( and a writ of e7ec,tion was iss,ed +,t later 8,ashed +y the L& on motion of U/ d,e to the dis-,tes regarding the amo,nt of the award. B,t% s,ch order 8,ashing the writ was reversed +y the NLRC. U/ moved to reconsider the NLRC resol,tion +,t it was ,-held with the modiAcation that the satisfaction of the C,dgment award in favor of Loc1heed will +e only against the f,nds of U/ which are not identiAed as -,+lic f,nds. The order and resol,tion +ecame Anal and an alias writ of e7ec,tion was iss,ed. /,rs,ant to s,ch order% a notice of garnishment was iss,ed to /NB for the satisfaction of the award. U/ Aled a motion to 8,ash the writ of garnishment and arg,ed that the f,nds are -,+lic in nat,re and are earmar1ed for ed,cational -,r-oses. &fter $ days from the recei-t of the notice% /NB released the garnished f,nds in favor of the NLRC. U/ Aled a -etition for certiorari +efore the C& on the garnishment order which was initially ,-held +y the C& +,t ,-on reconsideration% it reversed itself and r,led in favor of U/ after a--lying the -rinci-les in the NB& case. Th,s% Loc1heed Aled the -etition +efore the SC. 3SSUB* 2?N the money claim against U/% +eing a Government instr,mentality% sho,ld have +een co,rsed to the C?& Arst. P" F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch SC RUL3NG* Ses. This Co,rt held that li1e in the NBD case% U/ is a C,ridical -ersonality se-arate and distinct from the government and has the ca-acity to s,e and +e s,ed and +eing s,ch% it cannot evade e7ec,tion% and its f,nds may +e s,+Cect to garnishment or levy. =owever% +efore e7ec,tion may +e had% a claim for -ayment of the C,dgment award m,st Arst +e Aled with the C?&. Under Commonwealth &ct No. :(P as amended +y Section (! of /.D. No. @@#% it is the C?& which has -rimary C,risdiction to e7amine% a,dit and settle Eall de+ts and claims of any sortE d,e from or owing the Government or any of its s,+divisions% agencies and instr,mentalities% incl,ding government0owned or controlled cor-orations and their s,+sidiaries. 2ith res-ect to money claims arising from the im-lementation of Re-,+lic &ct No. !P#'% their allowance or disallowance is for C?& to decide% s,+Cect only to the remedy of a--eal +y -etition for certiorari to this Co,rt. &s to the fait accom-li arg,ment of Loc1heed% contrary to its claim that there is nothing that can +e done since the f,nds of U/ had already +een garnished% since the garnishment was erroneo,sly carried o,t and did not go thro,gh the -ro-er -roced,re ;the Aling of a claim with the C?&<% U/ is entitled to reim+,rsement of the garnished f,nds -l,s interest of !Q -er ann,m% to +e com-,ted from the time of C,dicial demand to +e rec1oned from the time U/ Aled a -etition for certiorari +efore the C& which occ,rred right after the withdrawal of the garnished f,nds from /NB. /etitioner Loc1heed Detective and 2atchman &gency% 3nc. was ordered to reim+,rse University of the /hili--ines the amo,nt of /(%$!(%:"'.P -l,s interest of !Q -er ann,m% to +e com-,ted from Se-tem+er (% ($$# ,- to the Anality of the decision% and (Q interest on the entire amo,nt from date of Anality of the co,rtIs decision ,ntil f,lly -aid. ESTATE OF NELSON R. DULAY, REPRESENTED BY HIS WIFE MERRIDY ANE P. DULAY, PETITIONER, VS.ABOITI& EBSEN MARITIME, INC. AND GENERAL CHARTERERS, INC., RESPONDENTS. G.R. No. P(!@(% .,ne :% ($(
)&CTS* Nelson R. D,lay was em-loyed +y General Charterers 3nc. ;GC3<% a s,+sidiary of &+oitiR .e+sen 5aritime 3nc. since "'!. ?n &,g,st :% ($$$% or (# days after the com-letion of his em-loyment contract% Nelson died d,e to ac,te renal fail,re secondary to se-ticemia. NelsonIs widow% 5erridy .ane% thereafter claimed for death +eneAts thro,gh the grievance -roced,re of the Collective Bargaining &greement ;CB&< +etween &5?SU/ and GC3. =owever% on .an,ary ("% ($$% the grievance -roced,re was Kdeclared deadloc1edO as -etitioners ref,sed to grant the +eneAts so,ght +y the widow. /etitioner contends that Section $ of Re-,+lic &ct ;R.&.< '$@(% otherwise 1nown as the 5igrant 2or1ers and ?verseas )ili-inos &ct of ""#% vests C,risdiction on the a--ro-riate +ranches of the NLRC to entertain dis-,tes regarding the inter-retation of a collective +argaining agreement involving migrant or overseas )ili-ino wor1ers. ?n their -art% res-ondents insist that in the -resent case% &rticle (P% -aragra-h ;c< as well as &rticle (! of the La+or Code remain to +e the governing -rovisions of law with res-ect to ,nresolved grievances arising from the inter-retation and im-lementation of collective +argaining agreements. Under these -rovisions of law% C,risdiction remains with vol,ntary ar+itrators. 3SSUB* 2hether or not the C& committed error in r,ling that the La+or &r+iter has no C,risdiction over the case. RUL3NG* The -etition is witho,t merit. 3t is tr,e that R.&. '$@( is a s-ecial law governing overseas )ili-ino wor1ers. =owever% a caref,l reading of this s-ecial law wo,ld readily show that there is no s-eciAc -rovision there,nder which -rovides for C,risdiction over dis-,tes or ,nresolved grievances regarding the inter-retation or im-lementation of a CB&. Section $ of R.&. '$@(% which is cited +y -etitioner% sim-ly s-ea1s% in general% of Kclaims arising o,t of an em-loyer0em-loyee relationshi- or +y virt,e of any law or contract involving )ili-ino wor1ers for overseas de-loyment incl,ding claims for act,al% moral% e7em-lary and other forms of damages.O ?n the other hand% &rticles (P;c< and (! of the La+or Code are very s-eciAc in stating that vol,ntary ar+itrators have C,risdiction over cases arising from the inter-retation or im-lementation of collective +argaining agreements. Stated diJerently% the instant case involves a sit,ation where the s-ecial stat,te ;R.&. '$@(< refers to a s,+Cect in general% which the general stat,te ;La+or Code< treats in -artic,lar. 3n the -resent case% the +asic iss,e raised +y 5erridy .ane in her com-laint Aled with the NLRC is* which -rovision of the s,+Cect CB& a--lies insofar as death +eneAts d,e to the heirs of Nelson are concerned. The Co,rt agrees with the C& in holding that this iss,e clearly involves the inter-retation or '$ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch im-lementation of the said CB&. Th,s% the s-eciAc or s-ecial -rovisions of the La+or Code govern.
3n any case% the Co,rt agrees with -etitioner6s contention that the CB& is the law or contract +etween the -arties. 3t is settled that when the -arties have validly agreed on a -roced,re for resolving grievances and to s,+mit a dis-,te to vol,ntary ar+itration then that -roced,re sho,ld +e strictly o+served. 3t may not +e amiss to -oint o,t that the a+ove8,oted -rovisions of the CB& are in consonance with R,le 433% Section P of the -resent ?mni+,s R,les and Reg,lations 3m-lementing the 5igrant 2or1ers and ?verseas )ili-inos &ct of ""#% as amended +y Re-,+lic &ct No. $$((% which states that KMfNor ?)2s with collective +argaining agreements% the case shall +e s,+mitted for vol,ntary ar+itration in accordance with &rticles (! and (!( of the La+or Code.O ?n the +asis of the foregoing% the Co,rt Ands no error in the r,ling of the C& that the vol,ntary ar+itrator has C,risdiction over the instant case. 2=BRB)?RB% the -etition is DBN3BD. The Decision and Resol,tion of the Co,rt of &--eals in C&0G.R. S/ No. P!@'" dated .,ly % ($$# and &-ril '% ($$!% res-ectively% are &))3R5BD. S? ?RDBRBD. PRUDENTIAL GUARANTEE V. NLRC G.R. N?. '#::#% .UNB :% ($( )&CTS* 4allota commenced his em-loyment with res-ondent /r,dential G,arantee and &ss,rance% 3nc. ;/G&3< on 5ay !% ""# as a .,nior /rogrammer. ?n Novem+er % ($$#% /G&3Is =,man Reso,rce 5anager% &tty. .oa8,in R. Rillo informed Union /resident% 5i1e &-ostol that /G&3 was going to cond,ct an on0the0s-ot sec,rity chec1 in the 3nformation and Technology ;3T< De-artment. &tty. Rillo also re8,ested that Union re-resentatives witness the ins-ection to which &-ostol agreed. The ins-ection team -roceeded to the 3T De-artment and initiated the s-ot chec1 of 3T De-artment com-,ters% +eginning with the one assigned to 4allota. &fter e7-loring the contents of all the folders and s,+folders in the K5y Doc,mentsO folder% G,tierreR a--arently did not And anything ,n,s,al with 4allotaIs com-,ter however% RetiRos insisted and too1 over the ins-ection ,ntil she fo,nd a folder named K5&&.O & co-y of the contents of the 5&& folder was saved in a To--y dis1. ?n Novem+er @% ($$#% 4allota received a memorand,m directing him to e7-lain within P( ho,rs why highly conAdential Ales were stored in his com-,ter. =e was then informed and -laced ,nder -reventive s,s-ension for :$ days which was e7tended for another :$ days. 3n a letter dated Decem+er !% ($$#% 4allota re8,ested a conference% to +e attended +y a Union re-resentative and co,nsel. 3n re-ly% /G&3 sent 4allota another memorand,m% which% among others% set a new deadline for 4allota to s,+mit his re-ly and evidence in his defense. 3n com-liance with the deadline set% 4allota s,+mitted his re-ly0memorand,m. 5eanwhile% the Union sent a letter to /G&3 /resident /hili- X. Rico ;Rico< re8,esting that a grievance committee +e convened and that the contents of the com-,ters of other 3T -ersonnel +e similarly -rod,ced. The re8,est for the convening of a grievance committee was ignored. ?n Decem+er (% ($$#% 4allota was given a notice of termination of his em-loyment eJective .an,ary $% ($$! on the gro,nd of loss of tr,st and conAdence. Th,s% -etitioner Aled a com-laint for illegal dismissal. The L& held that /G&3 failed to meet its +,rden of evidence% and the conTicting claims of the -arties were resolved in favor of 4allota for fail,re of /G&3 to add,ce s,+stantial evidence to s,--ort its claim. The L& li1ewise r,led that 4allota was denied d,e -rocess since the res-ondents ref,sed to cond,ct a hearing% des-ite 4allotaIs re8,est% to thresh o,t the matters raised +y him in his memoranda. 3SSUB* 2=BT=BR ?R N?T T=B =?N?R&BLB C?URT ?) &//B&LS C?553TTBD GR&4B &BUSB ?) D3SCRBT3?N 3N G343NG L3BBR&L3TS T? /R34&TB RBS/?NDBNTSM6N )?UR BL&T&NT 43?L&T3?NS ?) T=B NLRC RULBS ?) /R?CBDURB. Mnote* another iss,e was 2?N there were circ,mstances C,stifying the dismissal of 4allota 000 no longer disc,ssed as the case fell ,nder the to-ic NLRC r,les of -roced,reN RUL3NG* ' F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch )irst% the allegation of grave a+,se of discretion is mis-laced% as this is an iss,e a--ro-riate for a -etition for certiorari ,nder R,le !#% not a -etition for review on certiorari ,nder R,le @#. There is no 8,estion that grave a+,se of discretion or errors of C,risdiction may +e corrected only +y the s-ecial civil action of certiorari. S,ch s-ecial remedy does not avail in instances of error of C,dgment which can +e corrected +y a--eal or +y a -etition for review. Beca,se the -etitioners availed of the remedy ,nder R,le @#% reco,rse to R,le !# cannot +e allowed either as an add0on or as a s,+stit,te for a--eal. Whether the procedural due process reEuirements for termination were oser%ed! The -etitioners allege that 4allota was denied d,e -rocess of law% as the records of the case clearly show that his re8,est for an administrative hearing was denied witho,t reason +y /G&3. Citing R,le % Section (;d< of the 3m-lementing R,les of Boo1 43 of the La+or Code% the -etitioners arg,e that a hearing or conference m,st +e cond,cted to aJord the em-loyee an o--ort,nity to res-ond to the charge% and to -resent or re+,t evidence -resented against him. The -etitioners are of the -osition that the ,nC,stiAed ref,sal of /G&3 to cond,ct a hearing violated the said -rovision of the R,les im-lementing the La+or Code% as well as 4allotaIs right to defend himself +efore an im-artial investigating +ody. The Co,rt e7-lained the conce-t of the o--ort,nity to +e heard in the case of /ereR v. /hili--ine Telegra-h and Tele-hone Com-any* )his interpretation of Section 3(d)0 Rule + of the +mplementing Rules of #ook C+ of the Laor 'ode reasonaly implements the Fample opportunity to e heardG standard under Article 3HH() of the Laor 'ode without unduly restricting the language of the law or e8cessi%ely urdening the employer! )his not only respects the power %ested in the Secretary of Laor and Employment to promulgate rules and regulations that will lay down the guidelines for the implementation of Article 3HH()! &ore importantly0 this is faithful to the mandate of Article D of the Laor 'ode that FIaJll douts in the implementation and interpretation of the pro%isions of Ithe Laor 'odeJ0 including its implementing rules and regulations shall e resol%ed in fa%or of laor!G
3n s,m% the following are the g,iding -rinci-les in connection with the hearing re8,irement in dismissal cases*
;a< Kam-le o--ort,nity to +e heardO means any meaningf,l o--ort,nity ;ver+al or written< given to the em-loyee to answer the charges against him and s,+mit evidence in s,--ort of his defense% whether in a hearing% conference or some other fair% C,st and reasona+le way. ;+< a formal hearing or conference +ecomes mandatory only when re8,ested +y the em-loyee in writing or s,+stantial evidentiary dis-,tes e7ist or a com-any r,le or -ractice re8,ires it% or when similar circ,mstances C,stify it. ;c< the Kam-le o--ort,nity to +e heardO standard in the La+or Code -revails over the Khearing or conferenceO re8,irement in the im-lementing r,les and reg,lations.
3n this case% the two0notice re8,irement was com-lied with. By the -etitionersI own admission% /G&3 iss,ed to 4allota a written Notice of Charges U /reventive S,s-ension. &fter an e7change of memoranda% /G&3 then informed 4allota of his dismissal in its decision dated Decem+er (% ($$#. Given% however% that the -etitioners e7-ressly re8,ested a conference or a convening of a grievance committee% following the Co,rtIs r,ling in the /ereR case% which was later cited in the recent case of Lo-eR v. <,ras Gro,- of Com-anies% s,ch formal hearing +ecame mandatory. &fter /G&3 failed to a9rmatively res-ond to s,ch re8,est% it follows that the hearing re8,irement was not com-lied with and% therefore% 4allota was denied his right to -roced,ral d,e -rocess. 3n light of the a+ove disc,ssion% 4allota is entitled to reinstatement and +ac1wages% rec1oned from the date he was illegally dismissed ,ntil the Anality of this decision in accordance with C,ris-r,dence. Mnote f,rther disc,ssion +,t not related to the to-ic assigned* 3n view of the strained relations +etween 4allota and /G&3% however% it is not in the +est interest of the -arties% nor is it advisa+le or -ractical to order reinstatement. 2here reinstatement is no longer via+le as an o-tion% se-aration -ay e8,ivalent to one ;< month salary for every year of service sho,ld +e awarded as an alternative.
/RD ALERT SECURITY AND DETECTIVE SERVICES, INC. vs.ROMUALDO NAVIA .UNB :% ($( '( F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch )&CTS* The la+or ar+iter iss,ed a decision that NaviaIs dismissal was illegal. :rd &lert a--ealed to the National La+or Relations Commission ;NLRC< which a9rmed the r,ling of the la+or ar+iter. :rd &lert Aled an a--eal with the C& with a -rayer for the iss,ance of a tem-orary restraining order. The C& denied the a--ealD :rd &lert moved for a motion for reconsideration +,t the motion was also denied. The writ of e7ec,tion ?n .an,ary ("% ($$"% the NLRC iss,ed an Bntry of .,dgment certifying that the NLRC resol,tion dated ?cto+er "% ($$' has +ecome Anal and e7ec,tory. Th,s% Navia Aled with the la+or ar+iter an e70-arte motion for recom-,tation of +ac1 wages and an e70-arte motion for e7ec,tion +ased on the recom-,ted +ac1 wages. The la+or ar+iter iss,ed a writ of e7ec,tion to enforce the recom-,ted monetary awards. :rd &lert a--ealed the recom-,ted amo,nt stated in the writ of e7ec,tion to the NLRC. :rd &lert also alleged that the writ was iss,ed with grave a+,se of discretion since there was already a notice of reinstatement sent to Navia. The NLRC dismissed the a--eal% r,ling that :rd &lert is g,ilty of +ad faith since there was no earnest eJort to reinstate Navia. The NLRC also r,led that there was no notice or reinstatement sent to NaviaIs co,nsel. :rd &lert Aled a -etition for certiorari with the C& which fo,nd the -etition witho,t merit +eca,se Navia had not +een reinstated either -hysically or in the -ayroll. 3SSUB* whether the C& erred in r,ling that the NLRC did not commit any grave a+,se of discretion. =BLD* No. &rticle ((: of the La+or Code -rovides that in case there is an order of reinstatement% the em-loyer m,st admit the dismissed em-loyee ,nder the same terms and conditions% or merely reinstate the em-loyee in the -ayroll. The order shall +e immediately e7ec,tory. Th,s% :rd &lert cannot esca-e lia+ility +y sim-ly invo1ing that Navia did not re-ort for wor1. The law states that the em-loyer m,st still reinstate the em-loyee in the -ayroll. 2here reinstatement is no longer via+le as an o-tion% se-aration -ay e8,ivalent to one ;< month salary for every year of service co,ld +e awarded as an alternative.# Since the -roceedings +elow indicate that :rd &lert failed to add,ce additional evidence to show that it tried to reinstate Navia% either -hysically or in the -ayroll% we ado-t as correct the Anding that there was no earnest eJort to reinstate Navia. The C& was correct in a9rming the C,dgment of the NLRC in this regard. 2e also ta1e note that :rd &lert resorted to legal tactics to fr,strate the e7ec,tion of the la+or ar+iterIs orderD for a+o,t fo,r ;@< years% it evaded the o+ligation to reinstate Navia. By so doing% :rd &lert has made a moc1ery of C,stice. 2e th,s And it -ro-er% ,nder the circ,mstances% to im-ose tre+le costs against :rd &lert for its ,tter disregard to com-ly with the writ of e7ec,tion. To reiterate% no indication e7ists showing that :rd &lert e7erted any eJorts to reinstate NaviaD worse% :rd &lertIs lame e7c,se of having sent a notice of reinstatement to a certain EBiRnarE only com-o,nded the intent to mislead the co,rts. &lso% the main iss,e of this case% Anding Navia to have +een illegally dismissed% has already attained Anality. Litigation m,st end and terminate sometime and somewhere% and it is essential for an eJective and e9cient administration of C,stice that% once a C,dgment has +ecome Anal% the winning -arty +e not de-rived of the fr,its of the verdict.! The order is to reinstate NaviaD sadly% the mere e7ec,tion of this C,dgment has to even reach the highest co,rt of the land% there+y fr,strating the entire C,dicial -rocess. This C,stiAes the tre+le costs we now im-ose against :rd &lert. RADIO MINDANAO NETWORK, INC. AND ERIC S. CANOY VS. DOMINGO &. YBAROLA, ET AL. G.R. N?. "'!!(. SB/TB5BBR (% ($( )&CTS* Res-ondents Domingo W. S+arola% .r. and &lfonso B. Rivera% .r. were hired on .,ne #% "PP and .,ne % "':% res-ectively% +y R5N. They event,ally ': F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch +ecame acco,nt managers% soliciting advertisements and servicing vario,s clients of R5N. =owever% the res-ondentsI services were terminated as a res,lt of R5NIs reorganiRation>restr,ct,ringD they were given their se-aration -ay /!:%(#$.$$ for S+arola% and /@'%(#$.$$ for Rivera. Sometime in ($$(% they e7ec,ted release>8,itclaim a9davits. DissatisAed with their se-aration -ay% the res-ondents Aled se-arate com-laints ;which were later consolidated< against R5N and its /resident% Bric S. Canoy% for illegal dismissal with several money claims% incl,ding attorneyIs fees. They indicated that their monthly salary rates were /!$%$$$.$$ for S+arola and /@$%$$$.$$ for Rivera. La+or &r+iter /atricio Li+o0on dismissed the illegal dismissal com-laint% +,t ordered the -ayment of additional se-aration -ay to the res-ondents /@"$%$!!.$$ for S+arola and /@("%#P.## for Rivera. ?n a--eal +y the -etitioners to the National La+or Relations Commission ;NLRC<% the NLRC set aside the la+or ar+iterIs decision and dismissed the com-laint for lac1 of merit. B,t the NLRC ,-held the validity of the res-ondentsI 8,itclaim a9davits as they failed to show that they were forced to e7ec,te the doc,ments. )rom the NLRC% the res-ondents so,ght relief from the C& thro,gh a -etition for certiorari ,nder R,le !# of the R,les of Co,rt. 3n its decision% the C& granted the -etition and set aside the assailed NLRC dis-ositions. 3SSUBS* Sho,ld the commissions earned +y the res-ondents +e incl,ded in the com-,tation of their se-aration -ayL 2ere the 8,itclaims iss,ed +y the res-ondents invalidL RUL3NG* The Co,rt is not convinced with -etitioners claim that the commissions were not -art of the salaries. 3f these commissions had +een really -roAt0 sharing +on,ses to the res-ondents% they sho,ld have received the same amo,nts% yet% as the NLRC itself noted% S+arola and Rivera received /:P(%P:. and /#'!%""'.#$ commissions% res-ectively% in($$(. The variance in amo,nts the res-ondents received as commissions s,--orts the C&Is Anding that the salary str,ct,re of the res-ondents was s,ch that they only received a minimal amo,nt as g,aranteed wageD a greater -art of their income was derived from the commissions they get from soliciting advertisementsD these advertisements are the K-rod,ctsO they sell. &s the C& a-tly noted% this 1ind of salary str,ct,re does not detract from the character of the commissions +eing -art of the salary or wage -aid to the em-loyees for services rendered to the com-any 2ith regards to the 8,itclaims% -etitionersI reliance on o,r r,ling in Talam v. National La+orRelations Commission% regarding the K-ro-er a--reciation of 8,itclaims%Oas they -,t it% is mis-laced. 2hile Talam% in the cited case% and S+arola and Rivera% in this case% are not ,nlettered em-loyees% their sit,ations diJer in all other res-ects. 3n Talam% the em-loyee received a val,a+le consideration for his less than two years of service with the com-anyD he was not shortchanged and no essential ,nfairness too1 -lace. 3n the case at +ar% as the C& noted% the se-aration -ay the res-ondents each received was deAcient +y at least /@$$%$$$.$$D th,s% they were given only half of the amo,nt they were legally entitled to. To +e s,re% a settlement ,nder these terms is not and cannot +e a reasona+le one% given es-ecially the res-ondentsI length of service (# years for S+arola and " years for Rivera. The C& was correct when it o-ined that the res-ondents were in dire straits when they e7ec,ted the release>8,itclaim a9davits. 2itho,t Co+s and with families to s,--ort% they dallied in e7ec,ting the 8,itclaim instr,ment% +,t were event,ally forced to sign given their circ,mstances. PORTILLO V. LIET& ?CT?BBR $% ($( )&CTS* & letter agreement was e7ec,ted +etween individ,al res-ondent R,dolf LietR ;R,dolf< and /ortillo% where the /ortillo was hired +y R,dolf LietR ;LietR% 3nc.< ,nder the condition that /ortillo will not engage in any other gainf,l em-loyment +y yo,rself or with any other com-any either directly or indirectly witho,t written consent of LietR% 3nc. and +reach thereof will render /ortillo lia+le for damages. /ortillo was -romoted to Sales Re-resentative and received a corres-onding increase in +asic monthly salary and sales 8,ota. 3n this regard% /ortillo signed another letter agreement containing a EGoodwill Cla,se*E '@ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch +t remains understood and you agreed that0 on the termination of your employment y act of either you or ILiet:0 +nc!J0 and for a period of three (B) years thereafter0 you shall not engage directly or indirectly as employee0 manager0 proprietor0 or solicitor for yourself or others in a similar or competiti%e usiness or the same character of work which you were employed y ILiet:0 +nc!J to do and perform! Three years after% /ortillo resigned. D,ring her e7it interview% she declared that she intended to engage in +,siness ] a rice dealershi-% selling rice in wholesale. LietR 3nc acce-ted and reminded her of the goodwill cla,se. S,+se8,ently% LietR% 3nc. learned that /ortillo had +een hired +y Bd Xeller /hili--ines% Limited. Bd Xeller Limited is -,r-ortedly a direct com-etitor of LietR% 3nc. 5eanwhile% /ortillo6s demands from LietR% 3nc. for the -ayment of her remaining salaries and commissions went ,nheeded. LietR% 3nc. gave /ortillo the r,n aro,nd% on the -rete7t that her salaries and commissions were still +eing com-,ted. /ortillo Aled com-laint with NLRC. LietR 3nc admitted lia+ility for money claims +,t claims that it sho,ld +e oJset with /ortilloIs lia+ility for damages for violating goodwill cla,se. 3SSUB* whether /ortillo6s money claims for ,n-aid salaries may +e oJset against res-ondents6 claim for li8,idated damages. RUL3NG* &s early as Singa-ore &irlines Limited v. /aVo% we esta+lished that not all dis-,tes +etween an em-loyer and his em-loyee;s< fall within the C,risdiction of the la+or tri+,nals. 2e diJerentiated +etween a+andonment -er se and the manner and conse8,ent eJects of s,ch a+andonment and r,led that the Arst% is a la+or case% while the second% is a civil law case. 2e thereafter r,led that the Ereasona+le ca,sal connection with the em-loyer0em-loyee relationshi-E is a re8,irement not only in em-loyees6 money claims against the em-loyer +,t is% li1ewise% a condition when the claimant is the em-loyer. 3n Dai0Chi Blectronics 5an,fact,ring Cor-oration v. 4illarama% .r.% which reiterated the San 5ig,el r,ling and allied C,ris-r,dence% we -rono,nced that a non0com-ete cla,se% as in the EGoodwill Cla,seE referred to in the -resent case% with a sti-,lation that a violation thereof ma1es the em-loyee lia+le to his former em-loyer for li8,idated damages% refers to -ost0em-loyment relations of the -arties. That the EGoodwill Cla,seE in this case is li1ewise a -ost0em-loyment iss,e sho,ld +roo1 no arg,ment. There is no dis-,te as to the cessation of /ortillo6s em-loyment with LietR% 3nc. She sim-ly claims her ,n-aid salaries and commissions% which LietR% 3nc. does not contest. &t that C,nct,re% /ortillo was no longer an em-loyee of LietR% 3nc. The EGoodwill Cla,seE or the ENon0Com-ete Cla,seE is a contract,al ,nderta1ing eJective after the cessation of the em-loyment relationshi- +etween the -arties. 3n accordance with C,ris-r,dence% +reach of the ,nderta1ing is a civil law dis-,te% not a la+or law case. 3t is clear% therefore% that while /ortillo6s claim for ,n-aid salaries is a money claim that arises o,t of or in connection with an em-loyer0em-loyee relationshi-% LietR% 3nc.6s claim against /ortillo for violation of the goodwill cla,se is a money claim +ased on an act done after the cessation of the em-loyment relationshi-. &nd% while the C,risdiction over /ortillo6s claim is vested in the la+or ar+iter% the C,risdiction over LietR% 3nc.6s claim rests on the reg,lar co,rts. 3n the case at +ar% the diJerence in the nat,re of the credits that one has against the other% conversely% the nat,re of the de+t one owes another% which diJerence in t,rn res,lts in the diJerence of the for,m where the diJerent credits can +e enforced% -revents the a--lication of com-ensation. Sim-ly% the la+or tri+,nal in an em-loyee6s claim for ,n-aid wages is witho,t a,thority to allow the com-ensation of s,ch claims against the -ost em-loyment claim of the former em-loyer for +reach of a -ost em-loyment condition. The la+or tri+,nal does not have C,risdiction over the civil case of +reach of contract. There is no ca,sal connection +etween the -etitioner em-loyees6 claim for ,n-aid wages and the res-ondent em-loyers6 claim for damages for the alleged EGoodwill Cla,seE violation. /ortillo6s claim for ,n-aid salaries did not have anything to do with her alleged violation of the em-loyment contract as% in fact% her se-aration from em-loyment is not ErootedE in the alleged contract,al violation. She resigned from her em-loyment. She was not dismissed. /ortillo6s entitlement to the ,n-aid salaries is not even contested. 3ndeed% LietR% 3nc.6s arg,ment a+o,t legal com-ensation necessarily admits that it owes the money claimed +y /ortillo. '# F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch The alleged contract,al violation did not arise d,ring the e7istence of the em-loyer0em-loyee relationshi-. 3t was a -ost0em-loyment matter% a -ost0 em-loyment violation. ACE NAVIGATION CO. INC. VS. FERNANDE& G.R. N?. "P:$"% ?CT?BBR $% ($( )&CTS* ?n ?cto+er "% ($$'% seaman Teodorico )ernandeR ;)ernandeR<% assisted +y his wife% Glenita )ernandeR% Aled with the National La+or Relations Commission ;NLRC< a com-laint for disa+ility +eneAts% with -rayer for moral and e7em-lary damages% -l,s attorneyIs fees% against &ce Navigation Co.% 3nc.% 4ela 3nternational 5arine Ltd.% and>or Rodolfo /amint,an ;-etitioners<. The -etitioners moved to dismiss the com-laint% contending that the la+or ar+iter had no C,risdiction over the dis-,te. They arg,ed that e7cl,sive original C,risdiction is with the vol,ntary ar+itrator or -anel of vol,ntary ar+itrators% -,rs,ant to Section (" of the /?B& Standard Bm-loyment Contract ;/?B&0SBC<% since the -arties are covered +y the &5?SU/0TCC or &5?SU/04BL& ;as later cited +y the -etitioners< collective +argaining agreement ;CB&<. Under Section @ of the CB&% a dis-,te +etween a seafarer and the com-any shall +e settled thro,gh the grievance machinery and mandatory vol,ntary ar+itration. )ernandeR o--osed the motion. =e arg,ed that inasm,ch as his com-laint involves a money claim% original and e7cl,sive C,risdiction over the case is vested with the la+or ar+iter. ?n Decem+er "% ($$'% La+or &r+iter Romelita N. RioTorido denied the motion to dismiss% holding that ,nder Section $ of Re-,+lic &ct ;R.&.< No. '$@(% the 5igrant 2or1ers and ?verseas )ili-inos &ct of ""#% the la+or ar+iter has original and e7cl,sive C,risdiction over money claims arising o,t of an em-loyer0em-loyee relationshi- or +y virt,e of any law or contract% notwithstanding any -rovision of law to the contrary. The -etitioners a--ealed to the NLRC% +,t the la+or agency denied the a--eal. 3t agreed with the la+or ar+iter that the case involves a money claim and is within the C,risdiction of the la+or ar+iter% in accordance with Section $ of R.&. No. '$@(. &dditionally% it declared that the denial of the motion to dismiss is an interloc,tory order which is not a--eala+le. &ccordingly% it remanded the case to the la+or ar+iter for f,rther -roceedings. The -etitioners moved for reconsideration% +,t the NLRC denied the motion% -rom-ting the -etitioners to elevate the case to the C& thro,gh a -etition for certiorari ,nder R,le !# of the R,les of Co,rt. Thro,gh its decision of Se-tem+er ((% ($$% the C& denied the -etition on -roced,ral and s,+stantive gro,nds. ?n the merits of the case% the C& +elieved that the -etition cannot also -ros-er. 3t reCected the -etitionersI s,+mission that the grievance and vol,ntary ar+itration -roced,re of the -artiesI CB& has C,risdiction over the case% to the e7cl,sion of the la+or ar+iter and the NLRC. &s the la+or ar+iter and the NLRC did% it o-ined that ,nder Section $ of R.&. No. '$@(% the la+or ar+iter has the original and e7cl,sive C,risdiction to hear )ernandeRIs money claims. ),rther% the C& clariAed that while the law allows -arties to s,+mit to vol,ntary ar+itration other la+or dis-,tes% incl,ding matters falling within the original and e7cl,sive C,risdiction of the la+or ar+iters ,nder &rticle (P of the La+or Code as this Co,rt recogniRed in 4ivero v. Co,rt of &--eals% the -artiesI s,+mission agreement m,st +e e7-ressed in ,ne8,ivocal lang,age. 3t fo,nd no s,ch ,ne8,ivocal lang,age in the &5?SU/>TCC CB& that the -arties agreed to s,+mit money claims or% more s-eciAcally% claims for disa+ility +eneAts to vol,ntary ar+itration. 3SSUB* 2ho has the original and e7cl,sive C,risdiction over )ernandeRIs disa+ility claim ] the la+or ar+iter ,nder Section $ of R.&. No. '$@(% as amended% or the vol,ntary ar+itration mechanism as -rescri+ed in the -artiesI CB& and the /?B&0SBCL =BLD* The answer lies in the StateIs la+or relations -olicy laid down in the Constit,tion and Teshed o,t in the ena+ling stat,te% the La+or Code. Section :% &rticle \333 ;on Social .,stice and =,man Rights< of the Constit,tion declares* 8 8 8 8 )he State shall promote the principle of shared responsiility etween workers and employers and the preferential use of %oluntary modes in settling disputes0 including conciliation0 and shall enforce their mutual compliance therewith to foster industrial peace! '! F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch &rticle (!$ of the La+or Code ;Grievance machinery and vol,ntary ar+itration< states* )he parties to a 'ollecti%e #argaining Agreement shall include therein pro%isions that will ensure the mutual oser%ance of its terms and conditions! )hey shall estalish a machinery for the ad$ustment and resolution of grie%ances arising from the interpretation or implementation of their 'ollecti%e #argaining Agreement and those arising from the interpretation or enforcement of company personnel policies! &rticle (! of the La+or Code ;.,risdiction of 4ol,ntary &r+itrators or -anel of 4ol,ntary &r+itrators<% on the other hand% reads in -art* )he Coluntary Aritrator or panel of Coluntary Aritrators shall ha%e original and e8clusi%e $urisdiction to hear and decide all unresol%ed grie%ances arising from the interpretation or implementation of the 'ollecti%e #argaining Agreement and those arising from the interpretation or enforcement of company personnel policiesI!J &rticle (!( of the La+or Code ;.,risdiction over other la+or dis-,tes< declares* )he Coluntary Aritrator or panel of Coluntary Aritrators0 upon agreement of the parties0 shall also hear and decide all other laor disputes including unfair laor practices and argaining deadlocks! ),rther% the /?B&0SBC% which governs the em-loyment of )ili-ino seafarers% -rovides in its Section (" on Dis-,te Settlement /roced,res* +n cases of claims and disputes arising from this employment0 the parties co%ered y a collecti%e argaining agreement shall sumit the claim or dispute to the original and e8clusi%e $urisdiction of the %oluntary aritrator or panel of %oluntary aritrators! +f the parties are not co%ered y a collecti%e argaining agreement0 the parties may at their option sumit the claim or dispute to either the original and e8clusi%e $urisdiction of the (ational Laor Relations 'ommission ;(LR')0 pursuant to Repulic Act (RA) 4/D3 otherwise known as the "ecision == K!R! (o! =?HB/? &igrant Workers and ,%erseas Lilipinos Act of =??M or to the original and e8clusi%e $urisdiction of the %oluntary aritrator or panel of %oluntary aritrators! +f there is no pro%ision as to the %oluntary aritrators to e appointed y the parties0 the same shall e appointed from the accredited %oluntary aritrators of the (ational 'onciliation and &ediation #oard of the "epartment of Laor and Employment! Iemphasis oursJ 2e And merit in the -etition. Under the a+ove08,oted constit,tional and legal -rovisions% the vol,ntary ar+itrator or -anel of vol,ntary ar+itrators has original and e7cl,sive C,risdiction over )ernandeRIs disa+ility claim. There is no dis-,te that the claim arose o,t of )ernandeRIs em-loyment with the -etitioners and that their relationshi- is covered +y a CB& ] the &5?SU/>TCC or the &5?SU/0 4BL& CB&. The CB& -rovides for a grievance -roced,re for the resol,tion of grievances or dis-,tes which occ,r d,ring the em-loyment relationshi- and% li1e the grievance machinery created ,nder &rticle (! of the La+or Code% it is a two0tiered mechanism% with vol,ntary ar+itration as the last ste-. Contrary to the C&Is reading of the CB&Is &rticle @% there is ,ne8,ivocal or ,nmista1a+le lang,age in the agreement which mandatorily re8,ires the -arties to s,+mit to the grievance -roced,re any dis-,te or ca,se of action they may have against each other. Read in its entirety% the CB&Is &rticle @ ;Grievance /roced,re< ,nmista1a+ly reTects the -artiesI agreement to s,+mit any ,nresolved dis-,te at the grievance resol,tion stage to mandatory vol,ntary ar+itration ,nder &rticle @.P;h< of the CB&. &nd% it sho,ld +e added that% in com-liance with Section (" of the /?B&0SBC which re8,ires that in cases of claims and dis-,tes arising from a seafarerIs em-loyment% the -arties covered +y a CB& shall s,+mit the claim or dis-,te to the original and e7cl,sive C,risdiction of the vol,ntary ar+itrator or -anel of vol,ntary ar+itrators. Since the -arties ,sed ,ne8,ivocal lang,age in their CB& for the s,+mission of their dis-,tes to vol,ntary ar+itration ;a condition laid down in 4ivero for the recognition of the s,+mission to vol,ntary ar+itration of matters within the original and e7cl,sive C,risdiction of la+or ar+iters<% we And that the C& committed a reversi+le error in its r,lingD it disregarded the clear mandate of the CB& +etween the -arties and the /?B&0SBC for s,+mission of the -resent dis-,te to vol,ntary ar+itration. 3t +ears stressing at this -oint that we are ,-holding the C,risdiction of the vol,ntary ar+itrator or -anel of vol,ntary ar+itrators over the -resent dis-,te% not only +eca,se of the clear lang,age of the -artiesI CB& on the matterD more im-ortantly% we so ,-hold the vol,ntary ar+itratorIs C,risdiction% in recognition of the StateIs e7-ress -reference for vol,ntary modes of dis-,te settlement% s,ch as conciliation and vol,ntary ar+itration as e7-ressed in the Constit,tion% the law and the r,les. 3n closing% we 8,ote with a--roval a most recent Co,rt -rono,ncement on the same iss,e% th,s 3t is settled that when the -arties have validly agreed on a -roced,re for resolving grievances and to s,+mit a dis-,te to vol,ntary ar+itration then that -roced,re sho,ld +e strictly o+served.: ;em-hasis o,rs< 'P F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch 2=BRB)?RB% -remises considered% the -etition is GR&NTBD. The assailed decision and resol,tion of the Co,rt of &--eals are SBT &S3DB. Teodorico )ernandeR6s disa+ility claim is RB)BRRBD to the Grievance Resol,tion bCommittee of the -arties6 collective +argaining agreement and>or the 5andatory &r+itration Committee% if warranted. XXI. RIGHT TO SELF-ORGANIZATION XXII. RIGHTS OF LEGITIMATE LABOR ORGANIZATIONS XXIII. REVISED GUIDELINES OF THE NCMB XXIV.UNFAIR LABOR PRACTICE PARK HOTEL VS. SORIANO G.R. N?. P'% SB/TB5BBR $% ($( )&CTS* /etitioners Gregg =ar+,tt ;=ar+,tt< and Bill /ercy ;/ercy< are the General 5anager and owner% res-ectively% of /ar1 =otel. /ercy% =ar+,tt and &tty. Ro+erto Bnri8,eR are also the o9cers and stoc1holders of B,rgos Cor-oration ;B,rgos<% a sister com-any of /ar1 =otel. Res-ondent 5anolo Soriano ;Soriano< was hired +y /ar1 =otel in .,ly ""$ as 5aintenance Blectrician% and then transferred to B,rgos in ""(. Res-ondent Lester GonRales ;GonRales< was em-loyed +y B,rgos as Doorman% and later -romoted as S,-ervisor. Res-ondent Solanda Badilla ;Badilla< was a +artender of .6s /layho,se o-erated +y B,rgos. Res-ondents were dismissed from wor1 for allegedly stealing com-any -ro-erties. &s a res,lt% res-ondents Aled com-laints for illegal dismissal% ,nfair la+or -ractice% and -ayment of moral and e7em-lary damages and attorney6s fees% +efore the La+or &r+iter ;L&<. 3n their com-laints% res-ondents alleged that the real reason for their dismissal was that they were organiRing a ,nion for the com-any6s em-loyees. The L&% the NLRC and the C& were ,nanimo,s in Anding -etitioners lia+le for illegal dismissal and ,nfair la+or -ractice +eca,se the res-ondents were dismissed witho,t d,e -rocess and that the main ca,se of their termination was that they were organiRing a ,nion s,--ressing their right to self0 organiRation. 3n fact% the theft case Aled +y B,rgos against Soriano and GonRales were dismissed +y the 5a1ati City /rosec,torIs ?9ce for ins,9ciency of evidence. RUL3NG* SC agreed with the L&% the NLRC and the C& e7ce-t on the Anding that /ar1 =otel was solidarily lia+le with B,rgos% the sister com-any. SC said that res-ondents K,tterly failed to -rove +y com-etent evidence that /ar1 =otel was a mere instr,mentality% agency% cond,it or adC,nct of B,rgos% or that its se-arate cor-orate veil had +een ,sed to cover any fra,d or illegality committed +y B,rgos against the res-ondents. &ccordingly% /ar1 =otel and B,rgos cannot +e considered as one and the same entity% and /ar1 =otel cannot +e held solidary lia+le with B,rgos.O &lso% SC also stated that /ar1 =otel was no longer the em-loyer of Soriano at the time he was dismissed in ""P. =owever KSection : of the Cor-oration Code ma1es a director -ersonally lia+le for cor-orate de+ts if he willf,lly and 1nowingly votes for or assents to -atently ,nlawf,l acts of the cor-oration. 3t also ma1es a director -ersonally lia+le if he is g,ilty of gross negligence or +ad faith in directing the aJairs of the cor-oration. Th,s% /ercy and =ar+,tt% having acted in +ad faith in directing the aJairs of B,rgos% are Cointly and severally lia+le with the latter for res-ondents6 dismissal.O 2ith res-ect to the iss,e of illegal dismissal% the SC had this to say* KThe re8,isites for a valid dismissal are* ;a< the em-loyee m,st +e aJorded d,e -rocess% i.e.% he m,st +e given an o--ort,nity to +e heard and defend himselfD and ;+< the dismissal m,st +e for a valid ca,se as -rovided in &rticle ('( of the La+or Code% or for any of the a,thoriRed ca,ses ,nder &rticles (': and ('@ of the same Code.O K3n the case +efore ,s% +oth elements are com-letely lac1ing. Res-ondents were dismissed witho,t any C,st or a,thoriRed ca,se and witho,t +eing given the o--ort,nity to +e heard and defend themselves. The law mandates that the +,rden of -roving the validity of the termination of em-loyment rests with the em-loyer. )ail,re to discharge this evidentiary +,rden wo,ld necessarily mean that the dismissal was not C,stiAed and% therefore% illegal. Uns,+stantiated s,s-icions% acc,sations% and concl,sions of em-loyers do not -rovide for legal C,stiAcation for dismissing em-loyees. 3n case of do,+t% s,ch cases sho,ld +e resolved in favor of la+or% -,rs,ant to the social C,stice -olicy of la+or laws and the Constit,tion.O '' F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch K&nent the ,nfair la+or -ractice% &rticle (@' ;a< of the La+or Code considers it an ,nfair la+or -ractice when an em-loyer interferes% restrains or coerces em-loyees in the e7ercise of their right to self0organiRation or the right to form an association. 3n order to show that the em-loyer committed ,nfair la+or -ractice ,nder the La+or Code% s,+stantial evidence is re8,ired to s,--ort the claim. S,+stantial evidence has +een deAned as s,ch relevant evidence as a reasona+le mind might acce-t as ade8,ate to s,--ort a concl,sion. 3n the case at +ar% res-ondents were indeed ,nceremonio,sly dismissed from wor1 +y reason of their intent to form and organiRe a ,nion.O So% K3n cases when an em-loyee is ,nC,stly dismissed from wor1% he shall +e entitled to reinstatement witho,t loss of seniority rights and other -rivileges% incl,sive of allowances% and other +eneAts or their monetary e8,ivalent from the time the com-ensation was withheld ,- to the time of act,al reinstatement.O K3n the case at +ar% the Co,rt Ands that it wo,ld +e +est to award se-aration -ay instead of reinstatement% in view of the -assage of a long -eriod of time since res-ondents6 dismissal. 7 7 7 7 7 7 7 7 7.O XXV. OTHER IMPORTANT LABOR PROVISIONS 1. CONTRACTING ARRANGEMENT MARIALY O. SY, ET AL., PETITIONERS, VS. FAIRLAND KNITCRAFT CO., INC., RESPONDENT. G.R. '"!#'% DBCB5BBR (% ($
The iss,es of L&B?R0?NLS C?NTR&CT3NG and the ac8,isition of a la+or tri+,nal of .UR3SD3CT3?N over the -erson of a res-ondent are the matters ,- for consideration in these consolidated /etitions for Review on 'ertiorari! )&CTU&L* )airland is a domestic cor-oration engaged in garments +,siness% while S,san de Leon ;S,san< is the owner>-ro-rietress of 2eesan Garments ;2eesan<. ?n the other hand% the com-laining wor1ers ;wor1ers< are sewers% trimmers% hel-ers% a g,ard and a secretary who were hired +y 2eesan. 3SSUBS* 3n G.R. No. '"!#'% S,san im-,tes ,-on the C& the following errors* 3. T=&T /BT3T3?NBR 3S & L&B?R0?NLS C?NTR&CT?R 0 &CT3NG &S &N &GBNT ?) RBS/?NDBNT )&3RL&ND. 33. T=&T T=B 3ND343DU&L /R34&TB RBS/?NDBNTS 2BRB 3LLBG&LLS D3S53SSBD. SC RUL3NG* 2e grant the wor1ersI -etition ;G.R. No. '("#< +,t deny the -etition of S,san ;G.R. No. '"!#'<. Susan1Weesan is a mere LA#,R*,(LN ',()RA'),R! KThere is L&B?R0?NLS C?NTR&CT3NG when the contractor or s,+contractor merely recr,its% s,--lies or -laces wor1ers to -erform a Co+% wor1 or service for a -rinci-al. 3n la+or0only contracting% the following elements are -resent* ;a< The -erson s,--lying wor1ers to an em-loyer does not have s,+stantial ca-ital or investment in the form of tools% e8,i-ment% machineries% wor1 -remises% among othersD and ;+< The wor1ers recr,ited and -laced +y s,ch -erson are -erforming activities which are directly related to the -rinci-al +,siness of the em-loyer.O
=ere% there is no 8,estion that the wor1ers% maCority of whom are sewers% were recr,ited +y S,san>2eesan and that they -erformed activities which are directly related to )airlandIs -rinci-al +,siness of garments. 2hat m,st +e determined is whether S,san>2eesan has SUBST&NT3&L C&/3T&L ?R 3N4BST5BNT in the form of tools% e8,i-ment% machineries% wor1 -remises% among others. 0 nothing in the records show that 0 2eesan has investment in the form of tools% e8,i-ment or machineries. 0 The records show that )airland has to f,rnish 2eesan with sewing machines for it to +e a+le to -rovide the sewing needs of the former. 0 &lso% save for the Balance Sheets -,r-ortedly s,+mitted +y 2eesan to the B,rea, of 3nternal Reven,e ;B3R< indicating its A7ed assets ;factory e8,i-ment< in the amo,nt of /(@:%$$$.$$% 2eesan was ,na+le to show that 0 a-art from the +orrowed sewing machines% it owned and -ossessed any other tools% e8,i-ment% and machineries necessary to its +eing a contractor or s,+0contractor for garments. '" F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch 0 Neither was 2eesan a+le to -rove that it has s,+stantial ca-ital for its +,siness.
Li1ewise signiAcant is the fact that 0 there is do,+t as to who really owns the 2?RX /RB53SBS occ,-ied +y 2eesan. 0 the wor1 -remises ,tiliRed +y 2eesan is owned +y )airland% which signiAcantly% was not in the +,siness of renting -ro-erties. 0 there was no showing that S,san>2eesan -aid any rentals for the ,se of the -remises. 0 S,san had a 5ayorIs /ermit for 2eesan indicating P# Ricafort Street% Tondo% 5anila as its address. 0 /etitioner tried to dis-rove this +y -resenting a -,r-orted Contract of Lease with another entity% De L,7e Shirt )actory Co.% 3nc. =owever% there is no com-etent -roof it -aid the s,--osed rentals to said aownerI. C,rio,sly% ,nder the item aRent B7-ensesI in its a,dited Anancial statement% only e8,i-ment rental was listed therein witho,t any dis+,rsement>e7-ense for rental of factory -remises% 0 T=US% the place where they reported to and performed sewing $os for petitioner ISusanJ and Lairland at (o! H=M Ricafort St!0 )ondo0 &anila0 elonged to Lairland! (Emphasis supplied!)
FItJhe presumption is that a contractor is a LA#,R*,(LN ',()RA'),R <(LESS such contractor o%ercomes the urden of pro%ing that it has sustantial capital0 in%estment0 tools and the like!G I &s S,san>2eesan was not a+le to add,ce evidence that 2eesan had any s,+stantial ca-ital% investment or assets to -erform the wor1 contracted for% the -res,m-tion that 2eesan is a la+or0only contractor stands. The National La+or Relations Commission and the Co,rt of &--eals did not err in their Andings of 3LLBG&L D3S53SS&L.
&rticle (': of the La+or Code 0 allows as a mode of termination of em-loyment 0 the clos,re or termination of +,siness. KClos,re or cessation of +,siness 0 is the com-lete or -artial cessation of the o-erations and>or sh,t0down of the esta+lishment of the em-loyer. 0 3t is carried o,t to either stave oJ the Anancial r,in or -romote the +,siness interest of the em-loyer.O 0 KThe decision to close +,siness Mor to tem-orarily s,s-end o-erationN is a management -rerogative e7cl,sive to the em-loyer% the e7ercise of which no co,rt or tri+,nal can meddle with% 0 B\CB/T only when the em-loyer fails to -rove com-liance with the RBYU3RB5BNTS ?) &RT. (':% to wit* a< that the clos,re>cessation of +,siness is ona 2de0 i!e.% its -,r-ose is to advance the interest of the em-loyer and not to defeat or circ,mvent the rights of em-loyees ,nder the law or a valid agreement7 +< that written notice was served on the em-loyees and the D?LB at least one month +efore the intended date of clos,re or cessation of +,sinessD and c< in case of clos,re>cessation of +,siness not d,e to Anancial losses% that the em-loyees aJected have +een given se-aration -ay e8,ivalent to ` month -ay for every year of service or one month -ay% whichever is higher.O
=ere% 2eesan Aled its BST&BL3S=5BNT TBR53N&T3?N RB/?RT 0 allegedly d,e to serio,s +,siness losses and other economic reasons. =owever% we are mindf,l of the do,+tf,l character of 2eesanIs a--lication for clos,re given the circ,mstances s,rro,nding the same. )irst% named wor1ers Sy% et al.% Aled +efore the La+or &r+iter their com-laint for ,nder-ayment of salary% non0-ayment of +eneAts% damages and attorneyIs fees against 2eesan 0 S,mmons was accordingly iss,ed and same was received +y S,san. 0 5eanwhile% other wor1ers followed s,it and Aled their res-ective com-laints. 0 Shortly thereafter or merely eight days after the Aling of the last com-laint% 2eesan Aled with the D?LB0NCR its Bsta+lishment Termination Re-ort. Second% the 3ncome Ta7 Ret,rns for the years ($$$% ($$ and ($$( attached to the Bsta+lishment Termination Re-ort% 0 altho,gh +earing the stam-ed recei-t of the Reven,e District ?9ce where they were -,r-ortedly Aled% contain no signat,re or initials of the receiving o9cer. The same holds tr,e with 2eesanIs a,dited Anancial statements. 0 This engenders do,+t as to whether these doc,ments were indeed Aled with the -ro-er a,thorities. Third% there was no showing that 2eesan served ,-on the wor1ers written notice at least one month +efore the intended date of clos,re of +,siness% as re8,ired ,nder &rt. (': of the La+or Code. "$ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch 0 3n fact% the wor1ers alleged that when 2eesan Aled its Bsta+lishment Termination Re-ort% it already closed the wor1 -remises and did not anymore allow them to re-ort for wor1. 0 This is the reason why the wor1ers amended their com-laint to incl,de the charge of illegal dismissal. M'N
FItJhe urden of pro%ing that 8 8 8 a )E&P,RARN S<SPE(S+,( +S #,(A L+"E falls upon the employer!G I43J
Clearly here% S,san>2eesan was not a+le to discharge this +,rden. S,san failed to -rove that the s,s-ension of o-erations of 2eesan was ona 2de and that it com-lied with the mandatory re8,irement of notice ,nder the lawD failed to discharge her +,rden of -roving that the termination of the wor1ers was for a lawf,l ca,se. Therefore% the NLRC and the C& did not err in their Andings that the wor1ers were illegally dismissed +y S,san>2eesan.
RE6 Lairland9s claim of PRES'R+P)+,( the Co,rt notes that the records are +ereft of anything that -rovides for s,ch alleged contract,al relationshi- and the -eriod covered +y it. &+sent anything to s,--ort )airlandIs claim% same deserves scant consideration.
3nterestingly% we noticed )airlandIs letter N dated .an,ary :% ($$: informing 2eesan that it wo,ld tem-orarily not +e availing of the latterIs sewing services and at the same time re8,esting for the ret,rn of the sewing machines it lent to 2eesan. &ss,ming said letter to +e tr,e% why was )airland terminating 2eesanIs services only on .an,ary :% ($$: when it is now claiming that its contract,al relationshi- with the latter only lasted ,ntil ""PL Th,s% we And the contentions rather a+str,se. RB* )3N&L3TS ?) NLRC DBC3S3?ND RBCB3/T BS C?UNSBL C& =BLD* 3N L&B?R C&SBS% +oth the -arty and his co,nsel m,st +e d,ly served their se-arate co-ies of the order% decision or resol,tion 0 Unli1e 3N ?RD3N&RS /R?CBBD3NGS where notice to co,nsel is deemed notice to the -arty. &rticle ((@ of the La+or Code. B7ec,tion of decisions% orders or awards. ;a< \ \ \ . . . it shall +e the d,ty of the res-onsi+le o9cer to se-arately f,rnish immediately the co,nsels of record and the -arties with co-ies of said decision% orders or awards. )ail,re to com-ly with the d,ty -rescri+ed herein shall s,+Cect s,ch res-onsi+le o9cer to a--ro-riate administrative sanctions 7 7 7 ;Bm-hasis in the original<. . . . since )airland and its co,nsel were not se-arately f,rnished with a co-y of the NLRC Resol,tion denying the motions for reconsideration of its Decision% said Decision cannot +e enforced against )airland00which held that S,san>2eesan and )airland solidarily lia+le to the wor1ers% as it has not attained Anality. SC =BLD* 2e cannot agree. &rticle ((@ of the La+or Code 0 does not govern the -roced,re for Aling a -etition for certiorari with the Co,rt of &--eals from the decision of the NLRC 0 +,t rather% it refers to the e8ecution of O2nal decisions0 orders or awards9 and re8,ires the sheriJ or a d,ly de-,tiRed o9cer to f,rnish +oth the -arties and their co,nsel with co-ies of the decision or award for that -,r-ose. 0 There is no reference% e7-ress or im-lied% to the -eriod to a--eal or to Ale a -etition for certiorari as indeed the ca-tion is ae7ec,tion of decisions% orders or awardsI. 0 Ta1en in -ro-er conte7t% &rticle ((@ contem-lates 0 the f,rnishing of co-ies of aAnal decisions% orders or awardsI and co,ld not have +een intended to refer to 0 the -eriod for com-,ting the -eriod for a--eal to the Co,rt of &--eals from a non0Anal C,dgment or order. The -eriod or manner of aa--ealI from the NLRC to the Co,rt of &--eals is governed +y R,le !# 0 -,rs,ant to the r,ling of the Co,rt in the case of St. 5artin ),neral =omes vs. NLRC. 0 Section @ of R,le !#% as amended% states that the a-etition may +e Aled not later than si7ty ;!$< days from notice of the C,dgment% or resol,tion so,ght to +e assailedI. " F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch
Corollarily% Section @% R,le 333 of the New R,les of /roced,re of the NLRC* 0 a;)<or the -,r-oses of com-,ting the /BR3?D ?) &//B&L% the same shall +e co,nted from recei-t of s,ch decisions% awards or orders +y the co,nsel of record.I <ho,gh this r,le e7-licitly contem-lates an a--eal +efore the La+or &r+iter and the NLRC% 0 we do not see any cogent reason why the same r,le sho,ld not a--ly to -etitions for certiorari Aled with the Co,rt of &--eals from decisions of the NLRC. 0 This -roced,re is in line with the esta+lished r,le that 0 notice to counsel is notice to party and when a -arty is re-resented +y co,nsel% notices sho,ld +e made ,-on the co,nsel of record at his given address to which notices of all 1inds emanating from the co,rt sho,ld +e sent. 0 3t is to +e noted also that Section P of the NLRC R,les of /roced,re -rovides that 0 O(A)ttorneys and other representati%es of parties shall ha%e authority to ind their clients in all matters of procedure99 0 a -rovision which is similar to Section (:% R,le :' of the R,les of Co,rt. 0 5ore im-ortantly% Section (% R,le : of the ""P R,les of Civil /roced,re 0 analogo,sly -rovides that 0 if any party has appeared y counsel0 ser%ice upon him shall e made upon his counsel!
To stress% &rticle ((@ contem-lates the f,rnishing of co-ies of Anal decisions% orders or awards oth to the -arties and their co,nsel in connection with the e7ec,tion of s,ch Anal decisions% orders or awards. 0 =owever% for the -,r-ose of com-,ting the -eriod for Aling an a--eal from the NLRC to the C&% same shall +e co,nted from recei-t of the decision% order or award +y the co,nsel of record -,rs,ant to the esta+lished r,le that 0 notice to counsel is notice to party! 0 &nd since the -eriod for Aling of an a--eal is rec1oned from the co,nselIs recei-t of the decision% order or award% 0 it necessarily follows that the rec1oning -eriod for their Anality is li1ewise the co,nselIs date of recei-t thereof% if a -arty is re-resented +y co,nsel. 0 =ence% the Kdate of recei-tO referred to in Sec. @% R,le 433 of the then in force New R,les of /roced,re of the NLRC decisions0 resolutions or orders of the (LR' shall ecome e8ecutory after =/ calendar days from receipt of the same0 refers to the date of recei-t +y co,nsel. 0 Th,s the said NLRC Decision +ecame Anal% as to )airland% $ calendar days after &tty. TecsonIs recei-t thereof. 3n s,m% we hold that the La+or &r+iter had validly ac8,ired .UR3SD3CT3?N over )airland and its manager% De++ie% 0 thro,gh the a--earance of &tty. Geronimo as their co,nsel and li1ewise% thro,gh the latterIs Aling of -leadings on their +ehalf. Lairland is Weesan9s principal! . . . other telling facts that )airland is S,san>2eesanIs -rinci-al% to wit* ;< aside from sewing machines% )airland also lent 2eesan other e8,i-ment s,ch as Are e7ting,ishers% o9ce ta+les and chairs% and -lastic chairsD M$"N
;(< no -roof evidencing the contract,al arrangement +etween 2eesan and )airland was ever s,+mitted +y )airlandD ;:< while +oth 2eesan and )airland assert that the former had other clients aside from the latter% no -roof of 2eesanIs contract,al relationshi- with its other alleged client is e7tant on the recordsD and ;@< there is no showing that any of the wor1ers were assigned to other clients aside from )airland. 5oreover% as fo,nd +y the NLRC% the manner of wor1 and the movement of the wor1ers were s,+Cect to )airlandIs control. Kfact,al Andings of 8,asi0C,dicial agencies li1e the NLRC% when a9rmed +y the Co,rt of &--eals% as in the -resent case% are concl,sive ,-on the -arties and +inding on this Co,rt.O M$N
"( F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch 4iewed in its entirety% we th,s declare that )airland is the -rinci-al of the la+or0only contractor% 2eesan.
)airland% therefore% as the -rinci-al em-loyer% is solidarily lia+le with S,san>2eesan% the la+or0only contractor% for the rightf,l claims of the em-loyees. Under this set0,-% S,san>2eesan% as the Ela+or0onlyE contractor% is deemed an agent of the -rinci-al% )airland% and the law ma1es the -rinci-al res-onsi+le to the em-loyees of the Ela+or0onlyE contractor as if the -rinci-al itself directly hired or em-loyed the em-loyees. MN POLYFOAM%RGC INTERNATIONAL CORPORATION AND PRECILLA GRAMAE VS. EDGARDO CONCEPCION G.R. N?.P(:@" .UNB :% ($( )&CTS* ?n )e+r,ary '% ($$$% res-ondent Aled a Com-laint for illegal dismissal% non0-ayment of wages% -remi,m -ay for rest day% se-aration -ay% service incentive leave -ay% :th month -ay% damages% and attorneyIs fees against /olyfoam and 5s. Natividad Cheng ;Cheng<. Res-ondent alleged that he was hired +y /olyfoam as an Kall0aro,ndO factory wor1er and served as s,ch for almost si7 years. ?n .an,ary @% ($$$% he allegedly discovered that his time card was not in the rac1 and was later informed +y the sec,rity g,ard that he co,ld no longer -,nch his time card. 2hen he -rotested to his s,-ervisor% the latter allegedly told him that the management decided to dismiss him d,e to an infraction of a com-any r,le. Res-ondentIs co,nsel later wrote a letter to /olyfoamIs manager re8,esting that res-ondent +e re0admitted to wor1% +,t the re8,est remained ,nheeded -rom-ting the latter to Ale the com-laint for illegal dismissal. ?n &-ril ('% ($$$% GramaCe Aled a 5otion for 3ntervention claiming to +e the real em-loyer of res-ondent. ?n the other hand% /olyfoam and Cheng Aled a 5otion to Dismiss on the gro,nds that the NLRC has no C,risdiction over the case% +eca,se of the a+sence of em-loyer0em-loyee relationshi- +etween /olyfoam and res-ondent and that the money claims had already -rescri+ed. 3SSUBS* 2hether or not GramaCe is an inde-endent Co+ contractorD 2hether or not an em-loyer0em-loyee relationshi- e7ists +etween /olyfoam and res-ondentD and 2hether or not res-ondent was illegally dismissed from em-loyment. SC RUL3NG* Krama$e is a Laor*,nly 'ontractor The test of inde-endent contractorshi- is Kwhether one claiming to +e an inde-endent contractor has contracted to do the wor1 according to his own methods and witho,t +eing s,+Cect to the control of the em-loyer% e7ce-t only as to the res,lts of the wor1.O The totality of the facts and the s,rro,nding circ,mstances of the case are to +e considered. &--lying the foregoing% GramaCe is not an inde-endent Co+ contractor% +,t a Kla+or0onlyO contractor. )irst% GramaCe has no s,+stantial ca-ital or investment. The -res,m-tion is that a contractor is a la+or0only contractor ,nless he overcomes the +,rden of -roving that it has s,+stantial ca-ital% investment% tools% and the li1e. Neither GramaCe nor /olyfoam -resented evidence showing GramaCeIs ownershi- of the e8,i-ment and machineries ,sed in the -erformance of the alleged contracted Co+. Considering that these machineries are fo,nd in /olyfoamIs -remises% there can +e no other logical concl,sion +,t that the tools and e8,i-ment ,tiliRed +y GramaCe and her Kem-loyeesO are owned +y /olyfoam. Neither did /olyfoam nor GramaCe show that the latter had clients other than the former. Second% GramaCe did not carry on an inde-endent +,siness or ,nderta1e the -erformance of its service contract according to its own manner and method% free from the control and s,-ervision of its -rinci-al% /olyfoam% its a--arent role having +een merely to recr,it -ersons to wor1 for /olyfoam. /rior to his termination% res-ondent had +een -erforming the same Co+ in /olyfoamIs +,siness for almost si7 ;!< years. =e was even f,rnished a co-y of /olyfoamIs K5ga &lit,nt,nin at Xaram-atang /ar,sa%O which em+odied /olyfoamIs r,les on attendance% the manner of -erforming the em-loyeeIs d,ties% ethical standards% cleanliness% health% safety% -eace and order. These r,les carried with them the corres-onding -enalties in case of violation. An Employer*Employee Relationship E8ists #etween Respondent and Polyfoam ": F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch & Anding that a contractor is a Kla+or0onlyO contractor% as o--osed to -ermissi+le Co+ contracting% is e8,ivalent to declaring that there is an em-loyer0em-loyee relationshi- +etween the -rinci-al and the em-loyees of the s,--osed contractor% and the Kla+or0onlyO contractor is considered as a mere agent of the -rinci-al% the real em-loyer. 3n this case% /olyfoam is the -rinci-al em-loyer and GramaCe is the la+or0only contractor. /olyfoam and GramaCe are% therefore% solidarily lia+le for the rightf,l claims of res-ondent. Respondent Was +llegally "ismissed Lrom Employment Res-ondent insisted that he was dismissed from em-loyment witho,t C,st or lawf,l ca,se and witho,t d,e -rocess. /olyfoam did not oJer any e7-lanation of s,ch dismissal. 3t% instead% e7-lained that res-ondentIs real em-loyer is GramaCe. GramaCe% on the other hand% denied the claim of illegal dismissal. She shifted the +lame on res-ondent claiming that the latter in fact a+andoned his wor1. &+andonment cannot +e inferred from the act,ations of res-ondent. 2hen he discovered that his time card was oJ the rac1% he immediately in8,ired from his s,-ervisor. =e later so,ght the assistance of his co,nsel% who wrote a letter addressed to /olyfoam re8,esting that he +e re0admitted to wor1. 2hen said re8,est was not acted ,-on% he Aled the instant illegal dismissal case. These circ,mstances clearly negate the intention to a+andon his wor1. /etitioners failed to show any valid or a,thoriRed ca,se ,nder the La+or Code which allowed it to terminate the services of res-ondent. Neither was it shown that res-ondent was given am-le o--ort,nity to contest the legality of his dismissal. No notice of termination was given to him. Clearly% res-ondent was not aJorded d,e -rocess. =aving failed to esta+lish com-liance with the re8,irements of termination of em-loyment ,nder the La+or Code% the dismissal of res-ondent was tainted with illegality. DIGITEL TELECOM PHILS. VS. DIGITEL EMPLOYEES UNION G.R. '@"$:0$@% ?ct. $% ($( )&CTS* Digitel Bm-loyees Union ;Union< is the e7cl,sive +argaining agent of all ran1 and Ale em-loyees of Digitel in ""@. The Union and Digitel then commenced collective +argaining negotiations which res,lted in a +argaining deadloc1. The Union threatened to go on stri1e% +,t then &cting La+or Secretary Lag,esma ass,med C,risdiction over the dis-,te and event,ally directed the -arties to e7ec,te a CB&.=owever% no CB& was forged +etween Digitel and the Union. The Union later +ecame dormant. $ years thereafter or on ($$@% Digitel received from Bs-lana% who claimed to +e /resident of the Union% a letter containing the list of o9cers% CB& -ro-osals and gro,nd r,les. Digitel demanded that the latter com-ly with the -rovisions of the UnionIs Constit,tion and By0laws on ,nion mem+ershi- and election of o9cers. ?n @ Novem+er ($$@% Bs-lana Aled a case for /reventive 5ediation +efore the NC5B +ased on DigitelIs violation of the d,ty to +argain. The ,nion Aled a notice of stri1e. ?n ($$#% S?LB% Sto. Tomas iss,ed an ?rder ass,ming C,risdiction over the la+or dis-,te. D,ring the -endency of the controversy% Digiserv% a non0-roAt enter-rise engaged in call center servicing% Aled with the D?LB an Bsta+lishment Termination Re-ort stating that it will cease its +,siness o-eration. The clos,re aJected at least $$ em-loyees% @( of whom are mem+ers of the res-ondent Union. &lleging that the aJected em-loyees are its mem+ers and in reaction to DigiservIs action% Bs-lana and his gro,- Aled another Notice of Stri1e for ,nion +,sting% illegal loc10o,t% and violation of the ass,m-tion order. ?n 5ay ($$#% the S?LB ordered the second notice of stri1e s,+s,med +y the -revio,s &ss,m-tion ?rder. 5eanwhile% on @ 5arch ($$#% Digitel Aled a -etition with the BLR see1ing cancellation of the UnionIs registration on the following gro,nds* < fail,re to Ale the re8,ired re-orts from ""@0($$@D (< misre-resentation of its alleged o9cersD :< mem+ershi- of the Union is com-osed of ran1 and Ale% s,-ervisory and managerial em-loyeesD and @< s,+stantial n,m+er of ,nion mem+ers are not Digitel em-loyees. The RD of the D?LB dismissed the -etition for lac1 of merit. The Regional Director held that Digitel failed to add,ce s,+stantial evidence to -rove misre-resentation and the mi7ing of non0Digitel em-loyees with the Union. )inally% he declared that the incl,sion of s,-ervisory and managerial em-loyees with the ran1 and Ale em-loyees is no longer a gro,nd for cancellation of the UnionIs certiAcate of registration. "@ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch The a--eal Aled +y Digitel with the BLR was event,ally dismissed for lac1 of merit. The S?LB directed Digitel to commence the CB& negotiation with the Union. Digitel moved for reconsideration on the contention that the -endency of the -etition for cancellation of the UnionIs certiAcate of registration is a -reC,dicial 8,estion. The 5R was denied. Digitel Aled a -etition+efore the C&. 3n accordance with ?rder of the Secretary of La+or% the ,nfair la+or -ractice iss,e was certiAed for com-,lsory ar+itration +efore the NLRC which dismissed the ,nfair la+or -ractice charge against Digitel +,t declaring the dismissal of the : em-loyees of Digiserv as illegal and ordering their reinstatement. Digitel Aled another -etition in ($$! +efore the Co,rt of &--eals% challenging the a+ove NLRC Decision and Resol,tion and arg,ing mainly that Digiserv em-loyees are not em-loyees of Digitel. C& dismissed the -etition s,staining the Anding that Digiserv is engaged in la+or0only contracting and that its em-loyees are act,ally em-loyees of Digitel. &n 5R Aled +y the Com-any was dismissed. =ence% this -etition for review on certiorari. 3SSUBS* < whether the Secretary of La+or erred in iss,ing the ass,m-tion order des-ite the -endency of the -etition for cancellation of ,nion registrationD (< whether Digiserv is a legitimate contractorD :< whether there was a valid dismissal. RUL3NG* The -endency of a -etition for cancellation of ,nion registration does not -recl,de collective +argaining. 3f a certiAcation election may still +e ordered des-ite the -endency of a -etition to cancel the ,nionIs registration certiAcate more so sho,ld the collective +argaining -rocess contin,e des-ite its -endency. 2e m,st em-hasiRe that the maCority stat,s of the res-ondent Union is not aJected +y the -endency of the /etition for Cancellation -ending against it. Unless its certiAcate of registration and its stat,s as the certiAed +argaining agent are revo1ed% the Com-any is% +y e7-ress -rovision of the law% d,ty +o,nd to collectively +argain with the Union. Digiserv is a la+or0only contractor. La+or0only contracting is e7-ressly -rohi+ited +y &rt $! of o,r La+or Code. 00deAning la+or0only contracting as Ks,--lying wor1ers to an em-loyer MwhoN does not have s,+stantial ca-ital or investment in the form of tools% e8,i-ment% machineries% wor1 -remises% among others% and the wor1ers recr,ited and -laced +y s,ch -erson are -erforming activities which are directly related to the -rinci-al +,siness of s,ch em-loyer.O Section #% R,le 43330&% Boo1 333 of the 3RR as amended +y D? No. '0$(* Section #. /rohi+ition against la+or0only contracting. c La+or0only contracting is here+y declared -rohi+ited. )or this -,r-ose% la+or0only contracting shall refer to an arrangement where the contractor or s,+contractor merely recr,its% s,--lies or -laces wor1ers to -erform a Co+% wor1 or service for a -rinci-al% and any of the following elements are -resent* i< The contractor or s,+contractor does not have s,+stantial ca-ital or investment which relates to the Co+% wor1 or service to +e -erformed and the em-loyees recr,ited% s,--lied or -laced +y s,ch contractor or s,+contractor are -erforming activities which are directly related to the main +,siness of the -rinci-alD or ii< The contractor does not e7ercise the right to control over the -erformance of the wor1 of the contract,al em-loyee. The law and its im-lementing r,les allow contracting arrangements for the -erformance of s-eciAc Co+s% wor1s or services. =owever% in order for s,ch o,tso,rcing to +e valid% it m,st +e made to an inde-endent contractor +eca,se the c,rrent la+or r,les e7-ressly -rohi+it la+or0only contracting. There is no showing that Digiserv has s,+stantial investment in the form of ca-ital% e8,i-ment or tools. Under the 3m-lementing R,les% s,+stantial ca-ital or investment refers to Kca-ital stoc1s and s,+scri+ed ca-italiRation in the case of cor-orations% tools% e8,i-ment% im-lements% machineries and wor1 -remises% act,ally and directly ,sed +y the contractor or s,+contractor in the -erformance or com-letion of the Co+% wor1 or service contracted o,t.O "# F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch The NLRC% as echoed +y the Co,rt of &--eals% did not And s,+stantial DigiservIs a,thoriRed ca-ital stoc1 of /5. 3t -ointed o,t that /(#$X had +een s,+scri+ed and /!(%#$$. There was no increase in ca-italiRation for the last $ years. 3n the &mended &rticles of 3ncor-oration% the -rimary -,r-ose of Digiserv is to -rovide man-ower services. The legitimate Co+ contractor -rovides services while the la+or0only contractor -rovides only man-ower. The legitimate Co+ contractor ,nderta1es to -erform a s-eciAc Co+ for the -rinci-al em-loyer while the la+or0only contractor merely -rovides the -ersonnel to wor1 for the -rinci-al em-loyer.O The services -rovided +y em-loyees of Digiserv are directly related to the +,siness of Digitel. Digiserv does not e7ercise control over the aJected em-loyees. The NLRC highlighted the fact that Digiserv shared the same =,man Reso,rces% &cco,nting% &,dit and Legal De-artments with Digitel which manifested that it was Digitel who e7ercised control over the -erformance of the aJected em-loyees. The NLRC also relied on the letters of commendation% -la8,es of a--reciation and certiAcation iss,ed +y Digitel to the C,stomer Service Re-resentatives as evidence of control. Th,s% the dismissed em-loyees are deemed em-loyees of their -rinci-al em-loyer Digitel.
Section P of the 3m-lementing R,les holds that la+or0only contracting wo,ld give rise to* ;< the creation of an em-loyer0em-loyee relationshi- +etween the -rinci-al and the em-loyees of the contractor or s,+0contractorD and ;(< the solidary lia+ility of the -rinci-aland the contractor to the em-loyees in the event of any violation of the La+or Code. )he aAected employees were illegally dismissed! 3t is ,ndis-,ted that the remaining aJected em-loyees% e7ce-t for two ;(<% were already hired +y D3G3TBL even +efore the e7istence of D3G3SBR4. 3t is e8,ally ,ndis-,ted that the remaining% aJected em-loyees contin,o,sly held the -osition of C,stomer Service Re-resentative% which was earlier 1nown as Tra9c ?-erator% from the time they were a--ointed on 5arch % ""@ ,ntil they were terminated on 5ay :$% ($$#. )or a valid retrenchment% the following elements m,st +e -resent* ;< That retrenchment is reasona+ly necessary and li1ely to -revent +,siness losses which% if already inc,rred% are not merely de minimis% +,t s,+stantial% serio,s% act,al and real% or if only e7-ected% are reasona+ly imminent as -erceived o+Cectively and in good faith +y the em-loyerD ;(< That the em-loyer served written notice +oth to the em-loyees and to the De-artment of La+or and Bm-loyment at least one month -rior the intended date of retrenchmentD ;:< That the em-loyer -ays the retrenched em-loyees se-aration -ay e8,ivalent to one ;< month -ay or at least ` month -ay for every year of service% whichever is higherD ;@< That the em-loyer e7ercises its -rerogative to retrench em-loyees in good faith for the advancement of its interest and not to defeat or circ,mvent the em-loyeesI right to sec,rity of ten,reD and ;#< That the em-loyer ,sed fair and reasona+le criteria in ascertaining who wo,ld +e dismissed and who wo,ld +e retained among the em-loyees% s,ch as stat,s% e9ciency% seniority% -hysical Atness% age% and Anancial hardshi- for certain wor1ers. ?nly the Arst : elements of a valid retrenchment had +een here satisAed. 3ndeed% it is management -rerogative to close a de-artment of the com-any. DigitelIs decision to o,tso,rce the call center o-eration of the com-any is a valid reason to close down the o-erations of a de-artment ,nder which the aJected em-loyees were em-loyed. The instant case is all a+o,t the fo,rth element% SC held that there was no good faith in the retrenchment. The eJects of the ass,m-tion order iss,ed +y the Secretary of La+or are two0fold. 3t enCoins an im-ending stri1e on the -art of the em-loyees and orders the em-loyer to maintain the stat,s 8,o.
There is no do,+t that Digitel deAed the ass,m-tion order +y a+r,-tly closing down Digiserv. The clos,re of a de-artment is not illegal -er se. 2hat ma1es it ,nlawf,l is when the clos,re is ,nderta1en in +ad faith. Bad faith was evidenced +y the timing of and reasons for the clos,re and the s,+se8,ent o-ening. Bad faith was manifested +y the timing of the clos,re of Digiserv and the rehiring of some em-loyees to 3nteractive Technology Sol,tions% 3nc. ;30 tech<% a cor-orate arm of Digitel. The ass,m-tion order directs em-loyees "! F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch to ret,rn to wor1% and the em-loyer to reinstate the em-loyees. The e7istence of the ass,m-tion order sho,ld have -rom-ted Digitel to o+serve the stat,s 8,o. 3nstead% Digitel -roceeded to close down Digiserv. The Secretary of La+or had to s,+s,me the second notice of stri1e in the ass,m-tion order. This order notwithstanding% Digitel -roceeded to dismiss the em-loyees. The timing of the creation of 30tech is d,+io,s. 3t was incor-orated while the la+or dis-,te within Digitel was -ending. The former head of Digiserv% is also an o9cer of 30tech. Th,s% when Digiserv was closed down% some of the em-loyees -res,ma+ly non0,nion mem+ers were rehired +y 30tech. Th,s% the clos,re of Digiserv -ending the e7istence of an ass,m-tion order co,-led with the creation of a new cor-oration -erforming similar f,nctions as Digiserv leaves no iota of do,+t that the target of the clos,re are the ,nion mem+er0em-loyees. These fact,al circ,mstances -rove that Digitel terminated the services of the aJected em-loyees to defeat their sec,rity of ten,re. The termination of service was not a valid retrenchmentD it was an illegal dismissal of em-loyees. 2. WORER!S PREFERENCE ". ATTY!S FEES AND APPEARANCE OF LAWYERS KAISAHAN AT KAPATIRAN NG MGA MANGGAGAWA V. MANILA WATER COMPANY GR N?. P@P"% N?4B5BBR !% ($ )&CTS* The Union is the d,ly0recogniRed +argaining agent of the ran10and0Ale em-loyees of the res-ondent 5anila 2ater Com-any% 3nc. ;'ompany< while Borela is the Union /resident. ?n )e+r,ary (% ""P% the 5etro-olitan 2aterwor1s and Sewerage System ;&WSS< entered into a Concession &greement ;Agreement< with the Com-any to -rivatiRe the o-erations of the 52SS. &rticle !..: of the &greement -rovides that Kthe Concessionaire shall grant MitsN em-loyees +eneAts no less favora+le than those granted to 52SS em-loyees at the time of MtheirN se-aration from 52SS.O &mong the +eneAts enCoyed +y the em-loyees of the 52SS were the amelioration allowance ;AA< and the cost0of0living allowance ;',LA< granted in &,g,st "P"% -,rs,ant to Letter of 3m-lementation No. "P iss,ed +y the ?9ce of the /resident.
The -ayment of the && and the C?L& was discontin,ed -,rs,ant to Re-,+lic &ct No. !P#'% otherwise 1nown as the KSalary StandardiRation Law%O which integrated the allowances into the standardiRed salary. Nonetheless% in ($$% the Union demanded from the Com-any the -ayment of the && and the C?L& d,ring the renegotiation of the -artiesI Collective Bargaining &greement ;'#A<. The Com-any initially t,rned down this demand% however% it s,+se8,ently agreed to an amendment of the CB&.
Thereafter% the Com-any integrated the && into the monthly -ayroll of all its em-loyees +eginning &,g,st % ($$(% -ayment of the && and the C?L& after an a--ro-riation was made and a--roved +y the 52SS Board of Tr,stees. The Com-any% however% did not s,+se8,ently incl,de the C?L& since the Commission on &,dit disa--roved its -ayment +eca,se the Com-any had no f,nds to cover this +eneAt.
&s a res,lt% the Union and Borela Aled on &-ril #% ($$: a com-laint against the Com-any for -ayment of the &&% C?L&% moral and e7em-lary damages% legal interest% and attorneyIs fees +efore the National La+or Relations Commission ;(LR'<.
The La+or &r+iter r,led in favor of the -etitioners and ordered the -ayment of their && and C?L&% si7 -ercent ;!Q< interest of the total amo,nt awarded% and ten -ercent ;$Q< attorneyIs fees. ?n a--eal +y the Com-any% the NLRC a9rmed with modiAcation the L&Is decision. 3t set aside the award of the C?L& +eneAts +eca,se the claim was not -roven and esta+lished% +,t ordered the Com-any to -ay the -etitioners their accr,ed && of a+o,t /$P%:$$%$$$.$$ in l,m- s,m and to contin,e -aying the && starting &,g,st % ($$(. 3t also ,-held the award of $Q attorneyIs fees to the -etitioners.
3n its 5otion for /artial Reconsideration of the NLRCIs Decem+er "% ($$: decision% the Com-any -ointed o,t that the award of ten -ercent ;$Q< attorneyIs fees to the -etitioners is already -rovided for in their Decem+er "% ($$: 5emorand,m of &greement ;&,A< which mandated that attorneyIs fees shall +e ded,cted from the && and CB& receiva+les. The NLRC s,+se8,ently denied +oth -artiesI 5otions for /artial Reconsideration% -rom-ting the Com-any to elevate t0e 1ase t, t0e "P F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch CA #$% a 2et3t3,* 4,- &'()$*(%($ 5*+e- R5le 67 ,4 t0e R5les ,4 C,5-t. 3n its Decision -rom,lgated on 5arch !% ($$!% the C& modiAed the assailed NLRC r,lings +y deleting KMtNhe order for res-ondent 52C3 to -ay attorneyIs fees e8,ivalent to $Q of the total C,dgment awards.O The C& recogniRed the +inding eJect of the 5?& +etween the Com-any and the UnionD it stressed that any f,rther award of attorneyIs fees is ,nfo,nded considering that it did not And anything in the &greement that is contrary to law% morals% good c,stoms% -,+lic -olicy or -,+lic order. 3SSUBS* ;< 2hether the C& can review the fact,al Andings of the NLRC in a R,le !# -etitionD and ;(< 2hether the NLRC gravely a+,sed its discretion in awarding ten -ercent ;$Q< attorneyIs fees to the -etitioners. RUL3NG* 2e agree with the -etitioners that as a r,le% the C& cannot ,nderta1e a re0 assessment of the evidence -resented in the case in certiorari -roceedings ,nder R,le !# of the R,les of Co,rt. =owever% the r,le admits of e7ce-tions. 3n &ercado %! A&A 'omputer 'ollege*ParaPaEue 'ity0 +nc.% we held that the C& may e7amine the fact,al Andings of the NLRC to determine whether or not its concl,sions are s,--orted +y s,+stantial evidence% whose a+sence C,stiAes a Anding of grave a+,se of discretion. 2e r,led* We agree with the petitioners that0 as a rule in certiorari proceedings under Rule .M of the Rules of 'ourt0 the 'A does not assess and weigh each piece of e%idence introduced in the case! )he 'A only e8amines the factual 2ndings of the (LR' to determine whether or not the conclusions are supported y sustantial e%idence whose asence points to gra%e ause of discretion amounting to lack or e8cess of $urisdiction! +n the recent case of Protacio %! Laya&ananghayaQ 'o!0 we emphasi:ed that6
Howe%er0 as an e8ception0 the appellate court may e8amine and measure the factual 2ndings of the (LR' if the same are not supported y sustantial e%idence! )he 'ourt has not hesitated to a-rm the appellate court9s re%ersals of the decisions of laor triunals if they are not supported y sustantial e%idence! (italics and emphasis supplied7 citation omitted)
3n the -resent case% we are therefore tas1ed to determine whether the C& correctly r,led that the NLRC committed grave a+,se of discretion in awarding $Q attorneyIs fees to the -etitioners. &rticle of the La+or Code% as amended% governs the grant of attorneyIs fees in la+or cases*
&rt. . Attorney9s fees!* ;a< 3n cases of ,nlawf,l withholding of wages% the c,l-a+le -arty may +e assessed attorneyIs fees e8,ivalent to ten -ercent of the amo,nt of wages recovered. ;+< 3t shall +e ,nlawf,l for any -erson to demand or acce-t% in any C,dicial or administrative -roceedings for the recovery of wages% attorneyIs fees which e7ceed ten -ercent of the amo,nt of wages recovered.
Section '% R,le 4333% Boo1 333 of its 3m-lementing R,les also -rovides% %i:!* Section '. Attorney9s fees! @ &ttorneyIs fees in any C,dicial or administrative -roceedings for the recovery of wages shall not e7ceed $Q of the amo,nt awarded. The fees may +e ded,cted from the total amo,nt d,e the winning -arty.
2e e7-lained in P'L Shipping Philippines0 +nc! %! (ational Laor Relations 'ommission M:@N that there are two commonly acce-ted 1,*1e2ts ,4 att,-*e89s 4ees . the ordinary and e7traordinary. 3n its ,-+3*a-8 1,*1e2t% an attorneyIs fee is the reasona+le com-ensation -aid to a lawyer +y his client for the legal services the former rendersD com-ensation is -aid for the cost and>or res,lts of legal services -er agreement or as may +e assessed. 3n its e:t-a,-+3*a-8 1,*1e2t% att,-*e89s 4ees a-e +ee;e+ 3*+e;*3t8 4,- +a;a<es ,-+e-e+ =8 t0e 1,5-t t, =e 2a3+ =8 t0e l,s3*< 2a-t8 t, t0e >3**3*< 2a-t8. The instances when these may +e awarded are en,merated in &rticle (($' of the Civil Code% s-eciAcally in its -aragra-h P on actions for recovery of wages% and is +%,%-.' /*) )* )0' .%1,'( -2) )* )0' &.$'/)% 5*less t0e 1l3e*t a*+ 03s la>8e- 0ave a<-ee+ t0at t0e a>a-+ s0all a11-5e t, t0e la>8e- as a++3t3,*al ,- 2a-t ,4 1,;2e*sat3,*. M:#N
2e also held in P'L Shipping that &rticle of the La+or Code% as amended% contem-lates the e:t-a,-+3*a-8 1,*1e2t of attorneyIs fees and that A-t31le ??? 3s a* e:1e2t3,* t, t0e +e1la-e+ 2,l318 ,4 st-31t "' F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch 1,*st-51t3,* 3* t0e a>a-+ ,4 att,-*e89s 4ees. Alt0,5<0 a* e:2-ess @*+3*< ,4 4a1ts a*+ la> 3s st3ll *e1essa-8 t, 2-,ve t0e ;e-3t ,4 t0e a>a-+, t0e-e *ee+ *,t =e a*8 s0,>3*< t0at t0e e;2l,8e- a1te+ ;al313,5sl8 ,- 3* =a+ 4a3t0 >0e* 3t >3t00el+ t0e >a<es. 3n carrying o,t and inter-reting the La+or Code6s -rovisions and im-lementing reg,lations% the em-loyee6s welfare sho,ld +e the -rimary and -aramo,nt consideration. This 1ind of inter-retation gives meaning and s,+stance to the li+eral and com-assionate s-irit of the law as em+odied in &rticle @ of the La+or Code ;which -rovides that EMaNll do,+ts in the im-lementation and inter-retation of the -rovisions of Mthe La+or CodeN% incl,ding its im-lementing r,les and reg,lations% shall +e resolved in favor of la+orE< and &rticle P$( of the Civil Code ;which -rovides that EMiNn case of do,+t% all la+or legislation and all la+or contracts shall +e constr,ed in favor of the safety and decent living for the la+orerO<.
2e similarly so r,led in R)K 'onstruction0 +nc! %! Lacto M:PN and in ,rti: %! San &iguel 'orporation! M:'N 3n R)K 'onstruction% we s-eciAcally stated* Settled is the rule that in actions for reco%ery of wages0 or where an employee was forced to litigate and0 thus0 incur e8penses to protect his rights and interests0 a monetary award y way of attorney9s fees is $usti2ale under Article === of the Laor 'ode7 Section 40 Rule C+++0 #ook +++ of its +mplementing Rules7 and paragraph H0 Article 33/4 of the 'i%il 'ode! T0' %1%(3 *4 %))*(/',!5 4''5 $5 +(*+'(6 %/3 )0'(' /''3 /*) -' %/, 50*1$/7 )0%) )0' '8+.*,'( %&)'3 8%.$&$*25., *( $/ -%3 4%$)0 10'/ $) 1$)00'.3 )0' 1%7'5. T0'(' /''3 */., -' % 50*1$/7 )0%) )0' .%142. 1%7'5 1'(' /*) +%$3 %&&*(3$/7.,. IB?J (emphasis ours) )rom this -ers-ective and the a+ove -recedents% we concl,de that the C& erred in r,ling that a Anding of the em-loyerIs malice or +ad faith in withholding wages m,st -recede an award of attorneyIs fees ,nder &rticle of the La+or Code. To reiterate% a -lain showing that the lawf,l wages were not -aid witho,t C,stiAcation is s,9cient.
3n the -resent case% we And it ,ndis-,ted that the ,nion mem+ers are entitled to their && +eneAts and that these +eneAts were not -aid +y the Com-any. That the Com-any had no f,nds is not a defense as this was not an ins,-era+le ca,se that was cited and -ro-erly invo1ed. &s a conse8,ence% the ,nion mem+ers re-resented +y the Union were com-elled to litigate and inc,r legal e7-enses. ?n these +ases% we And no di9c,lty in ,-holding the NLRCIs award of ten -ercent ;$Q< attorneyIs fees. The more signiAcant iss,e in this case is the eJect of the 5?& -rovision that attorneyIs fees shall +e ded,cted from the && and CB& receiva+les. 3n this regard% the C& held that the additional grant of $Q attorneyIs fees +y the NLRC violates &rticle of the La+or Code% considering that the 5?& +etween the -arties already ens,red the -ayment of $Q attorneyIs fees ded,cti+le from the && and CB& receiva+les of the UnionIs mem+ers. 3n addition% the Com-any also arg,es that the UnionIs demand% together with the NLRC award% is ,nconsciona+le as it re-resents ($Q of the amo,nt d,e or a+o,t /(.@ million.
3n )raders Royal #ank Employees <nion*+ndependent %! (LR'% M@N we e7-o,nded on the conce-t of attorneyIs fees in the conte7t of &rticle of the La+or Code% as follows* +n the 2rst place0 the fees mentioned here are the e8traordinary attorney9s fees reco%erale as $/3'8/$), 4*( 3%8%7'5 525)%$/'3 -, %/3 +%,%-.' )* )0' +('#%$.$/7 +%()9,:! +n the second place6 )0' )'/ +'(&'/) (=/R) attorney9s fees pro%ided for in Article === of the Laor 'ode and Section ==0 Rule C+++0 #ook +++ of the +mplementing Rules $5 )0' 8%;$828 *4 )0' %1%(3 )0%) 8%, )025 -' 7(%/)'3! A()$&.' 111 )025 <;'5 */., )0' .$8$) */ )0' %8*2/) *4 %))*(/',!5 4''5 )0' #$&)*($*25 +%(), 8%, ('&*#'( in any $udicial or administrati%e proceedings and it does not e%en pre%ent the (LR' from 28ing an amount lower than the ten percent (=/R) ceiling prescried y the article when circumstances warrant it! ID3J (emphases ours7 citation omitted)
3n the -resent case% the ten -ercent ;$Q< attorneyIs fees awarded +y the NLRC on the +asis of &rticle of the La+or Code accr,e to the UnionIs mem+ers as indemnity for damages and not to the UnionIs co,nsel as com-ensation for his legal services% 5*less, t0e8 a<-ee+ t0at t0e a>a-+ s0all =e <3ve* t, t0e3- 1,5*sel as a++3t3,*al ,- 2a-t ,4 03s 1,;2e*sat3,*A 3* t03s 1ase the Union +o,nd itself to -ay $Q attorneyIs fees to its co,nsel ,nder the 5?& and also gave ,- the attorneyIs fees awarded to the UnionIs mem+ers in favor of their co,nsel. This is s,--orted +y BorelaIs a9davit which stated that KMtNhe $Q attorneyIs fees -aid +y the mem+ers>em-loyees is se-arate and distinct from the o+ligation of the com-any to -ay the $Q awarded attorneyIs fees which we also gave to o,r co,nsel as -art of o,r contingent fee agreement.O The limit to this agreement is that the 3*+e;*3t8 4,- +a;a<es 3;2,se+ =8 t0e NLRC ,* t0e l,s3*< 2a-t8 #$.'., t0e C,;2a*8< cannot e7ceed ten -ercent ;$Q<.
"" F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch /ro-erly viewed from this -ers-ective% the award cannot +e ta1en to mean an additional grant of attorneyIs fees% in violation of the ten -ercent ;$Q< limit ,nder &rticle of the La+or Code since it rests on an entirely diJerent legal o+ligation than the one contracted ,nder the 5?&. Sim-ly stated% t0e att,-*e89s 4ees 1,*t-a1te+ 5*+e- t0e MOA +, *,t -e4e- t, t0e a;,5*t ,4 att,-*e89s 4ees a>a-+e+ =8 t0e NLRCA t0e MOA 2-,v3s3,* ,* att,-*e89s 4ees +,es *,t 0ave a*8 =ea-3*< at all t, t0e att,-*e89s 4ees a>a-+e+ =8 t0e NLRC 5*+e- A-t31le ??? ,4 t0e La=,- C,+e. Based on these considerations% it is clear that the C& erred in r,ling that the L&Is award of attorneyIs fees violated the ma7im,m limit of ten -ercent ;$Q< A7ed +y &rticle of the La+or Code.
Under this inter-retation% the Com-anyIs arg,ment that the attorneyIs fees are ,nconsciona+le as they re-resent ($Q of the amo,nt d,e or a+o,t /(.@ million is more a--arent than real. Since the attorneyIs fees awarded +y the L& -ertained to the UnionIs mem+ers as indemnity for damages% it was totally within their right to waive the amo,nt and give it to their co,nsel as -art of their contingent fee agreement. Beyond the limit A7ed +y &rticle of the La+or Code% s,ch as +etween the lawyer and the client% the attorneyIs fees may e7ceed ten -ercent ;$Q< on the +asis of Euantum meruit% as in the -resent case. XXVI. MISCELLANEOUS PROVISIONS 1. SPECIAL TYPES OF WORERS ATLANTA INDUSTRIES, INC. a*+(,- ROBERT CHAN, Pet3t3,*e-s, vs. APRILITO R. SEBOLINO, KHIM V. COSTALES, ALVIN V. ALMOITE, a*+ OSEPH S. SAGUN, Res2,*+e*ts. G.R. No. 'P:($% .an,ary (!% ($ )&CTS* &lfredo Se+olino and his co0res-ondents Ales several com-laints for illegal dismissal% reg,lariRation% ,nder-ayment% non-ayment of wages and other money claims% as well as claims for moral and e7em-lary damages and attorneyIs fees against the -etitioners &tlanta 3nd,stries% 3nc. ;&tlanta< and its /resident and Chief ?-erating ?9cer. &tlanta is a domestic cor-oration engaged in the man,fact,re of steel -i-es. The com-lainants alleged that they had attained reg,lar stat,s as they were allowed to wor1 with &tlanta for more than si7 ;!< months from the start of a -,r-orted a--renticeshi- agreement +etween them and the com-any. They claimed that they were illegally dismissed when the a--renticeshi- agreement e7-ired. 3n defense% &tlanta and Chan arg,ed that the wor1ers were not entitled to reg,lariRation and to their money claims +eca,se they were engaged as a--rentices ,nder a government0a--roved a--renticeshi- -rogram. The com-any oJered to hire them as reg,lar em-loyees in the event vacancies for reg,lar -ositions occ,r in the section of the -lant where they had trained. They also claimed that their names did not a--ear in the list of em-loyees ;5aster List< -rior to their engagement as a--rentices. 3SSUB* 2hether or not Se+olino and co0res-ondents are em-loyees of &tlanta. RUL3NG* The C& correctly r,led that the fo,r were illegally dismissed +eca,se ;< they were already em-loyees when they were re8,ired to ,ndergo a--renticeshi- and ;(< a--renticeshi- agreements were invalid. Based on com-any o-erations at the time material to the case% Costales% &lmoite% Se+olino and Sag,n were already rendering service to the com-any as em-loyees +efore they were made to ,ndergo a--renticeshi-. The com-any itself recogniRed the res-ondentsI stat,s thro,gh relevant o-erational records. The C& correctly recogniRed the a,thenticity of the o-erational doc,ments% for the fail,re of &tlanta to raise a challenge against these doc,ments +efore the la+or ar+iter% the NLRC and the C& itself. The a--ellate co,rt% th,s% fo,nd the said doc,ments s,9cient to esta+lish the em-loyment of the res-ondents +efore their engagement as a--rentices. The fact that Costales% &lmoite% Se+olino and Sag,n were already rendering service to the com-any when they were made to ,ndergo a--renticeshi- ;as esta+lished +y the evidence< renders the a--renticeshi- agreements irrelevant as far as the fo,r are concerned. This reality is highlighted +y the C& Anding that the res-ondents occ,-ied -ositions s,ch as machine o-erator% scaleman and e7tr,der o-erator 0 tas1s that are ,s,ally $$ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch necessary and desira+le in &tlantaIs ,s,al +,siness or trade as man,fact,rer of -lastic +,ilding materials. These tas1s and their nat,re characteriRed the fo,r as reg,lar em-loyees ,nder &rticle ('$ of the La+or Code. Th,s% when they were dismissed witho,t C,st or a,thoriRed ca,se% witho,t notice% and witho,t the o--ort,nity to +e heard% their dismissal was illegal ,nder the law. Bven if the com-anyIs need to train its em-loyees thro,gh a--renticeshi- is recogniRed% only the Arst a--renticeshi- agreement can +e considered for the -,r-ose. 2ith the e7-iration of the Arst agreement and the retention of the em-loyees% &tlanta had% to all intents and -,r-oses% recogniRed the com-letion of their training and their ac8,isition of a reg,lar em-loyee stat,s. To foist ,-on them the second a--renticeshi- agreement for a second s1ill which was not even mentioned in the agreement itself% is a violation of the La+or CodeIs im-lementing r,les and is an act manifestly ,nfair to the em-loyees% to say the least. 2. EMPLOYMENT OF WOMEN ". =CHILDREN >. =HOUSEHELPERS ?. =HOMEWORERS @. =NON-RESIDENT ALIENS WPP MARKETING COMMUNICATIONS INC., ET. AL., vs. GALERA G.R. No. !"($P% 5&RC= (#% ($$ )&CTS* /etitioner is .ocelyn Galera% an &merican citiRen who was recr,ited from the US +y -rivate res-ondent .ohn Steedman% Chairman02// 2orldwide and Chief B7ec,tive ?9cer of 5indshare% Co.% a cor-oration +ased in =ong Xong% China% to wor1 in the /hili--ines for -rivate res-ondent 2// 5ar1eting Comm,nications% 3nc. ;2//<. ?n Decem+er @% ($$$% G&LBR& alleged she was ver+ally notiAed +y -rivate STBBD5&N that her services had +een terminated from -rivate res-ondent 2//. & termination letter followed the ne7t day. ?n : .an,ary ($$% Galera Aled a com-laint for illegal dismissal% holiday -ay% service incentive leave -ay% :th month -ay% incentive -lan% act,al and moral damages% and attorney6s fees against 2// and>or .ohn Steedman ;Steedman<% 5ar1 2e+ster ;2e+ster< and Nominada Lansang ;Lansang<. The La+or &r+iter6s R,ling for illegal dismissal and damages in favor of G&LBR&. The )irst Division of the NLRC reversed the r,ling of &r+iter 5adriaga. Set it was reversed again +y C&. 3SSUBS* 2hether Galera is an Bm-loyee or a Cor-orate ?9cer. 2hether 2// illegally dismissed Galera. SC RUL3NG* Bm-loyee. Galera% on the +elief that she is an em-loyee% Aled her com-laint +efore the La+or &r+iter. ?n the other hand% 2//% Steedman% 2e+ster and Lansang contend that Galera is a cor-orate o9cerD hence% any controversy regarding her dismissal is ,nder the C,risdiction of the Regional Trial Co,rt. 2e agree with Galera. Cor-orate o9cers are given s,ch character either +y the Cor-oration Code or +y the cor-oration6s +y0laws. Galera6s a--ointment as a cor-orate o9cer ;4ice0/resident with the o-erational title of 5anaging Director of 5indshare< d,ring a s-ecial meeting of 2//6s Board of Directors is an a--ointment to a non0e7istent cor-orate o9ce. &t the time of Galera6s a--ointment% 2// already had one 4ice0/resident in the -erson of 2e+ster and all Ave directorshi- -ositions -rovided in the +y0laws are already occ,-ied. ¬her indicator that she was a reg,lar em-loyee and not a cor-orate o9cer is Section @ of the contract% which clearly states that she is a -ermanent em-loyee ] not a 4ice0/resident or a mem+er of the Board of Directors. ¬her convincing indication that she was only a reg,lar em-loyee and not a cor-orate o9cer is the disci-linary -roced,re% which states that her right of redress is thro,gh 5indshare6s Chief B7ec,tive ?9cer for the &sia0/aciAc. This im-lies that she was not ,nder the disci-linary control of -rivate res-ondent 2//6s Board of Directors ;B?D<% which sho,ld have +een the case if in fact she was a cor-orate o9cer +eca,se only the Board of Directors co,ld a--oint and terminate s,ch a cor-orate o9cer. 2//6s dismissal of Galera lac1ed +oth s,+stantive and -roced,ral d,e -rocess. &-art from Steedman6s letter dated # Decem+er ($$$ to Galera% 2// failed to -rove any C,st or a,thoriRed ca,se for Galera6s dismissal. Steedman6s letter to Galera reads* The o-erations are c,rrently in a sham+le. There is lac1 of leadershi- and conAdence in yo,r a+ilities from within% o,r agency -artners and some clients. 5ost of the staJ 3 s-o1e with felt they got more g,idance and direction from 5inda than yo,rself. 3n yo,r role as 5anaging Director% that is C,st not acce-ta+le. 3 +elieve yo,r -riorities are mismanaged. The recent sit,ation where yo, felt an internal strategy meeting was more im-ortant than a new +,siness -itch is a good $ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch e7am-le. So, failed to lead and advise on the two new +,siness -itches. 3n +oth cases% those involved sort ;sic< 5inda6s in-,t. &s 3 disc,ssed with yo, +ac1 in .,ly% my directive was for yo, to lead and review all +,siness -itches. 3t is o+vio,s MthatN conf,sion e7isted internally right ,- ,ntil the day of the -itch. The 8,ality o,t-,t is still not to an acce-ta+le standard% which was also -art of my directive that yo, needed to foc,s on +ac1 in .,ly. 3 do not +elieve yo, ,nderstand the +asic s1ills and ind,stry 1nowledge re8,ired to r,n a media s-ecial o-eration. 2//% Steedman% 2e+ster% and Lansang% however% failed to s,+stantiate the allegations in Steedman6s letter. Galera% on the other hand% -resented doc,mentary evidence (( in the form of congrat,latory letters% incl,ding one from Steedman% which contents are diametrically o--osed to the # Decem+er ($$$ letter. The law f,rther re8,ires that the em-loyer m,st f,rnish the wor1er so,ght to +e dismissed with two written notices +efore termination of em-loyment can +e legally eJected* ;< notice which a--rises the em-loyee of the -artic,lar acts or omissions for which his dismissal is so,ghtD and ;(< the s,+se8,ent notice which informs the em-loyee of the em-loyer6s decision to dismiss him. )ail,re to com-ly with the re8,irements taints the dismissal with illegality. (: 2//6s acts clearly show that Galera6s dismissal did not com-ly with the two0notice r,le. A. =STUDENTS & WORING SCHOLARS B. =ACADEMIC & NON-ACADEMIC PERSONNEL IN PRIVATE EDUCATIONAL INSTITUTIONS MERCADO ET. AL., vs. AMA COMPUTER COLLEGE%PARABA!UE CITY G.R. No. ':#P(% &/R3L :% ($$ )&CTS* The -etitioners were fac,lty mem+ers who started teaching at &5&CC on 5ay (#% ""'. The -etitioners e7ec,ted individ,al TeacherIs Contracts for each of the trimesters that they were engaged to teach% with the following common sti-,lation* )he )EA'HER has agreed to accept a non*tenured appointment to work in the 'ollege of 888 eAecti%e 888 to 888 or for the duration of the last term that the )EA'HER is gi%en a teaching load ased on the assignment duly appro%ed y the "EA(1SACP*',,! )or the school year ($$$0($$% &5&CC im-lemented new fac,lty screening g,idelines% set forth in its G,idelines on the 3m-lementation of &5&CC )ac,lty /lantilla. Under the new screening g,idelines% teachers were to +e hired or maintained +ased on e7tensive teaching e7-erience% ca-a+ility% -otential% high academic 8,aliAcations and research +ac1gro,nd. The -etitioners failed to o+tain a -assing rating +ased on the -erformance standardsD hence &5&CC did not give them any salary increase. ?n Se-tem+er P% ($$$% the -etitioners individ,ally received a memorand,m from &5&CC% thro,gh =,man Reso,rces S,-ervisor 5ary Grace Beronia% informing them that with the e7-iration of their contract to teach% their contract wo,ld no longer +e renewed. 3SSUB* Sho,ld the teachersI -ro+ationary stat,s +e disregarded sim-ly +eca,se the contracts were A7ed0termL SC RUL3NG* The La+or Code is s,--lemented with res-ect to the -eriod of -ro+ation +y s-ecial r,les fo,nd in the 5an,al of Reg,lations for /rivate Schools. ?n the matter of -ro+ationary -eriod% Section "( of these reg,lations -rovides* S'&)$*/ C2.P(*-%)$*/%(, P'($*3. @ Su$ect in all instances to compliance with the "epartment and school reEuirements0 the proationary period for academic personnel shall not e more than three (B) consecuti%e years of satisfactory ser%ice for those in the elementary and secondary le%els0 si8 (.) consecuti%e regular semesters of satisfactory ser%ice for those in the tertiary le%el0 and nine (?) consecuti%e trimesters of satisfactory ser%ice for those in the tertiary le%el where collegiate courses are oAered on a trimester asis! )or the entire d,ration of this three0year -eriod% the teacher remains ,nder -ro+ation. U-on the e7-iration of his contract of em-loyment% +eing sim-ly on -ro+ation% he cannot a,tomatically claim sec,rity of ten,re and com-el the em-loyer to renew his em-loyment contract. ?ther than on the -eriod% the following 8,oted -ortion of &rticle (' of the La+or Code still f,lly a--lies* 8 8 8 )he ser%ices of an employee who has een engaged on a proationary asis may e terminated for a $ust cause when he fails to Eualify as a regular employee in accordance with reasonale standards made known y the employer to the employee at the time of his $( F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch engagement! An employee who is allowed to work after a proationary period shall e considered a regular employee! &5&CCIs right to academic freedom is -artic,larly im-ortant in the -resent case% +eca,se of the new screening g,idelines for &5&CC fac,lty -,t in -lace for the school year ($$$0($$. 2e agree with the C& that &5&CC has the inherent right to esta+lish high standards of com-etency and e9ciency for its fac,lty mem+ers in order to achieve and maintain academic e7cellence. 3f we -ierce the veil% so to s-ea1% of the -artiesI so0called A7ed0 term em-loyment contracts% what ,ndenia+ly comes o,t at the core is a A7ed0term contract conveniently ,sed +y the school to deAne and reg,late its relations with its teachers d,ring their -ro+ationary -eriod. To +e s,re% nothing is illegitimate in deAning the school0teacher relationshi- in this manner. The school% however% cannot forget that its system of A7ed0term contract is a system that o-erates d,ring the -ro+ationary -eriod and for this reason is s,+Cect to the terms of &rticle (' of the La+or Code. Given the clear constit,tional and stat,tory intents% we cannot +,t concl,de that in a sit,ation where the -ro+ationary stat,s overla-s with a A7ed0term contract not s-eciAcally ,sed for the A7ed term it oJers% &rticle (' sho,ld ass,me -rimacy and the A7ed0-eriod character of the contract m,st give way. This concl,sion is immeas,ra+ly strengthened +y the -etitionersI and the &5&CCIs hardly concealed e7-ectation that the em-loyment on -ro+ation co,ld lead to -ermanent stat,s% and that the contracts are renewa+le ,nless the -etitioners fail to -ass the schoolIs standards. To highlight what we mean +y a A7ed0term contract s-eciAcally ,sed for the A7ed term it oJers% a re-lacement teacher% for e7am-le% may +e contracted for a -eriod of one year to tem-orarily ta1e the -lace of a -ermanent teacher on a one0year st,dy leave. The e7-iration of the re-lacement teacherIs contracted term% ,nder the circ,mstances% leads to no -ro+ationary stat,s im-lications as she was never em-loyed on -ro+ationary +asisD her em-loyment is for a s-eciAc -,r-ose with -artic,lar foc,s on the term and with every intent to end her teaching relationshi- with the school ,-on e7-iration of this term. 2hile we can grant that the standards were d,ly comm,nicated to the -etitioners and co,ld +e a--lied +eginning the st trimester of the school year ($$$0($$% glaring and very +asic ga-s in the schoolIs evidence still e7ist. The e7act terms of the standards were never introd,ced as evidenceD neither does the evidence show how these standards were a--lied to the -etitioners. 2itho,t these -ieces of evidence ;eJectively% the Anding of C,st ca,se for the non0renewal of the -etitionersI contracts<% we have nothing to consider and -ass ,-on as valid or invalid for each of the -etitioners. 3nevita+ly% the non0renewal ;or eJectively% the termination of em-loyment of em-loyees on -ro+ationary stat,s< lac1s the s,--orting Anding of C,st ca,se that the law re8,ires and% hence% is illegal. C. MEDICAL6 DENTAL6 & OCCUPATIONAL SAFETY 10. MIGRANT WORER!S ACTDRECRUITMENT AND PLACEMENT PANGANIBAN V. TARA TRADING G.R. N?. 'P$:(% ?CT?BBR '% ($( )his is a petition for re%iew under Rule DM of the Rules of 'ourt challenging the "ecision of the 'A0 and its Resolution0 re%ersing the "ecision of the (LR' which a-rmed the decision of the Laor Ariter (LA) fa%oring the petitioner!
)&CTS* /etitioner was hired +y res-ondent Tara Trading Shi-management% 3nc. ()ara)0 in +ehalf of its foreign -rinci-al% res-ondent Shinline SDN B=D(Shinline) to wor1 as an ?iler on +oard 54 KThailine #O with a monthly salary of US^@$".$$.
Sometime in &-ril ($$!% -etitioner +egan e7hi+iting signs of mental insta+ility. =e was re-atriated on 5ay (@% ($$! for f,rther medical eval,ation and management. /etitioner was referred +y res-ondents to the 5etro-olitan 5edical Center where he was diagnosed to +e s,Jering from K+rief -sychotic disorder.O Des-ite his s,--osed total and -ermanent disa+ility and des-ite re-eated demands for -ayment of disa+ility com-ensation% res-ondents allegedly failed and ref,sed to com-ly with their contract,al o+ligations.
=ence% -etitioner Aled a Com-laint against res-ondents -raying for the -ayment of US^!$%$$$.$$ as total and -ermanent disa+ility +eneAts% reim+,rsement of medical and hos-ital e7-enses% moral and e7em-lary damages% and attorneyIs fees e8,ivalent to $Q of total claims.
The L& ruled in fa%or of the petitioner. $: F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch Res-ondents a--ealed to the NLRC. ?n 5arch (#% ($$'% the NLRC a9rmed the decision of the L&. The a--eal of res-ondents was dismissed for lac1 of merit. The motion for reconsideration was li1ewise denied.
&ggrieved% res-ondents Aled a /etition for Certiorari with -rayer for the iss,ance of a writ of -reliminary inC,nction and>or tem-orary restraining order with the C&. 3n their -etition% res-ondents -resented the following gro,nds*
A! Pulic respondent gra%ely aused its discretion and committed serious error in ruling that the petitioners are liale to pri%ate respondent for the payment of disaility compensation in the amount of <SS ./0///!// considering the facts as orne out y the e%idence on record and the applicale laws!
?n ?cto+er ("% ($$'% the C& re%ersed the decision of the NLRC.
The -ivotal iss,e to +e resolved is whether or not the C& is correct in denying -etitionerIs entitlement to f,ll and total disa+ility +eneAts amo,nting to US^!$%$$$.$$ and attorneyIs fees in the amo,nt of US^!%$$$.$$.
The Co,rt resolves the iss,e in the a9rmative.
3t need not +e overem-hasiRed that in the a+sence of s,+stantial evidence% wor1ing conditions cannot +e acce-ted to have ca,sed or at least increased the ris1 of contracting the disease% in this case% +rief -sychotic disorder. S,+stantial evidence is more than a mere scintilla. The evidence m,st +e real and s,+stantial% and not merely a--arentD for the d,ty to -rove wor10ca,sation or wor10aggravation im-osed +y law is real and not merely a--arent.
Bven in case of death of a seafarer% the grant of +eneAts in favor of the heirs of the deceased is not a,tomatic. &s in the case of Ri%era v. Wallem &aritime Ser%ices0 +nc.% witho,t a -ost0medical e7amination or its e8,ivalent to show that the disease for which the seaman died was contracted d,ring his em-loyment or that his wor1ing conditions increased the ris1 of contracting the ailment% the em-loyer>s cannot +e made lia+le for death com-ensation. 3n fact% in &auhay Shipping Ser%ices0 +nc! %! (LR'% the Co,rt held that the death of a seaman even d,ring the term of em-loyment does not a,tomatically give rise to com-ensation. Several factors m,st +e ta1en into acco,nt s,ch as the circ,mstances which led to the death% the -rovisions of the contract% and the right and o+ligation of the em-loyer and the seaman with d,e regard to the -rovisions of the Constit,tion on the d,e -rocess and e8,al -rotection cla,ses. /etitioner -oints o,t that his illness is wor10related sim-ly +eca,se had it +een a land0+ased em-loyment% -etitioner wo,ld have easily gone home and attended to the needs of his family.
The Co,rt cannot s,+mit to this arg,ment. This is not the Kwor10relatedO instance contem-lated +y the -rovisions of the em-loyment contract in order to +e entitled to the +eneAts. ?therwise% every seaman wo,ld a,tomatically +e entitled to com-ensation +eca,se the nat,re of his wor1 is not land0+ased and the s,+mission of the seaman to the com-any0 designated -hysician as to the nat,re of the illness s,Jered +y him wo,ld C,st +e an e7ercise of f,tility.
The fact is that the -etitioner failed to esta+lish% +y s,+stantial evidence% that his +rief -sychotic disorder was ca,sed +y the nat,re of his wor1 as oiler of the com-any0owned vessel. 3n fact% he failed to ela+orate on the nat,re of his Co+ or to s-ecify his f,nctions as oiler of res-ondent com-any. The Co,rt% therefore% has di9c,lty in Anding any lin1 +etween his -osition as oiler and his illness. $@ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch
The Co,rt cannot give less im-ortance either to the fact that -etitioner was a seaman for $ years serving $ to '0month contracts and never did he have any -ro+lems with his earlier contracts. The Co,rt can only s,rmise that the +rief -sychotic disorder s,Jered +y him was +ro,ght a+o,t +y a family -ro+lem. =is da,ghter was sic1 and% as a seafarer% he co,ld not C,st decide to go home and +e with his family. Bven the -sychiatric re-ort -re-ared +y the eval,ating -rivate -sychiatrist of -etitioner shows that the hos-italiRation of -etitionerIs yo,ngest da,ghter ca,sed him -oor slee- and a--etite. Later% he started hearing voices and develo-ed fearf,lness.
<ho,gh strict r,les of evidence are not a--lica+le in claims for com-ensation and disa+ility +eneAts% the Co,rt cannot C,st disregard the -rovisions of the /?B& SBC. SigniAcantly% a seaman is a contract,al and not a reg,lar em-loyee. =is em-loyment is contract,ally A7ed for a certain -eriod of time. /etitioner and res-ondents entered into a contract of em-loyment. 3t was a--roved +y the /?B& on ?cto+er (#% ($$# and% th,s% served as the law +etween the -arties. Undis-,tedly% Section ($0B of the /?B& &mended Standard Terms and Conditions Governing the Bm-loyment of )ili-ino Seafarers on Board ?cean0Going 4essels ;/?B&0SBC< -rovides for com-ensation and +eneAts for inC,ry or illness s,Jered +y a seafarer. 3t says that% in order to claim disa+ility +eneAts ,nder the Standard Bm-loyment Contract% it is the acom-any0designatedI -hysician who m,st -roclaim that the seaman s,Jered a -ermanent disa+ility% whether total or -artial% d,e to either inC,ry or illness% d,ring the term of the latterIs em-loyment. 3n this case% the Andings of res-ondentsI designated -hysician that -etitioner has +een s,Jering from +rief -sychotic disorder and that it is not wor10related m,st +e res-ected.
Lastly% it a--ears -remat,re at this time to consider -etitionerIs disa+ility as -ermanent and total +eca,se the severity of his ailment has not +een esta+lished with Anality to render him already inca-a+le of -erforming the wor1 of a seafarer. 3n fact% the medical e7-ert termed his condition as rief psychotic disorder. The Co,rt also ta1es note% as the C& correctly did% that -etitioner did not Anish his treatment with the com-any0 designated -hysician% hence% there is no Anal eval,ation yet on -etitioner. &ll told% no reversi+le error was committed +y the C& in rendering the assailed Decision and iss,ing the 8,estioned Resol,tion. YAP VS. THENAMARIS SHIP9S MANAGEMENT AND INTERMARE MARITIME AGENCIES, INC. G.R. N?. P"#:(% 5&S :$% ($ T0e D,1t-3*e ,4 O2e-at3ve Fa1t )&CTS* /etitioner Cla,dio S. Sa- was em-loyed as electrician of the vessel% 5>T SB&SC?UT on @ &,g,st ($$ +y 3ntermare 5aritime &gencies% 3nc. in +ehalf of its -rinci-al% 4,lt,re Shi--ing Limited. The contract of em-loyment entered into +y Sa- and Ca-t. )rancisco B. &dviento% the General 5anager of 3ntermare% was for a d,ration of ( months. ?n (: &,g,st ($$% Sa- +oarded 5>T SB&SC?UT and commenced his Co+ as electrician. =owever% on or a+o,t $' Novem+er ($$% the vessel was sold. The /hili--ine ?verseas Bm-loyment &dministration ;/?B&< was informed a+o,t the sale on $! Decem+er ($$ in a letter signed +y Ca-t. &dviento. Sa-% along with the other crewmem+ers% was informed +y the 5aster of their vessel that the same was sold and will +e scra--ed. They were also informed a+o,t the Ad%isory sent +y Ca-t. Constatino,% which states% among others* K _/LB&SB &SX SR ?))3CBRS &ND R&T3NGS 3) T=BS 23S= T? BB TR&NS)BRRBD T? ?T=BR 4BSSBLS &)TBR 4BSSBL S DBL34BRS ;GRBBX 43& &T=BNS0/=3L3/3N?S 43& 5&N3L&_ _)?R CRB2 N?T 23S= TR&NS)BR T? DBCL&RB T=B3R /R?S/BCTBD T35B )?R RBB5B&RX&T3?N 3N ?RDBR T? SC=BDULB T=B5 &CCLS_O Sa- received his seniority +on,s% vacation +on,s% e7tra +on,s along with the scra--ing +on,s. =owever% with res-ect to the -ayment of his wage% he ref,sed to acce-t the -ayment of one0month +asic wage. =e insisted that he was entitled to the -ayment of the ,ne7-ired -ortion of his contract since he was illegally dismissed from em-loyment. =e alleged that he o-ted for immediate transfer +,t none was made. Res-ondents% for their -art% contended that Sa- was not illegally dismissed. They alleged that following the sale of the 5>T SB&SC?UT% Sa- signed oJ from the vessel on $ Novem+er ($$ and was -aid his wages corres-onding to the months he wor1ed or ,ntil $ Novem+er ($$ -l,s his seniority +on,s% vacation +on,s and e7tra +on,s. They f,rther alleged that Sa-Is em-loyment contract was validly terminated d,e to the sale of the $# F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch vessel and no arrangement was made for Sa-Is transfer to ThenamarisI other vessels. 3SSUB* 2?N -etitioner is entitled to the -ayment of the ,ne7-ired -ortion of his contract since he was illegally dismissed from em-loyment. RUL3NG* The S,-reme Co,rt r,led that% Under Section $ of Re-,+lic &ct '$@(% the lia+ility of the em-loyer for illegal termination of the em-loyment of an overseas wor1er is* his salaries for the ,ne7-ired -ortion of his em-loyment contract or for three ;:< months for every year of the ,ne7-ired term% whichever is less. ;3ncidentally% this same -rovision was also incor-orated in Re-,+lic &ct $$(( 1nown as the &mended 5igrant 2or1ers &ct<. The S,-reme Co,rt ,-held the r,ling on illegal dismissal +,t r,led that seafarer sho,ld +e -aid his salaries for the ,ne7-ired -ortion of the em-loyment contract. Th,s% seafarer sho,ld +e -aid his remaining nine monthsI salary and not C,st three months as r,led +y the Co,rt of &--eals. The doctrine of o-erative fact serves as an e7ce-tion to the aforementioned general r,le. 3n Planters Products0 +nc! %! Lertiphil 'orporation% the Co,rt held* )he doctrine of operati%e fact0 as an e8ception to the general rule0 only applies as a matter of eEuity and fair play! +t nulli2es the eAects of an unconstitutional law y recogni:ing that the e8istence of a statute prior to a determination of unconstitutionality is an operati%e fact and may ha%e conseEuences which cannot always e ignored! )he past cannot always e erased y a new $udicial declaration! The doctrine is a--lica+le when a declaration of ,nconstit,tionality will im-ose an ,nd,e +,rden on those who have relied on the invalid law. Th,s% it was a--lied to a criminal case when a declaration of ,nconstit,tionality wo,ld -,t the acc,sed in do,+le Ceo-ardy or wo,ld -,t in lim+o the acts done +y a m,nici-ality in reliance ,-on a law creating it. )ollowing Serrano% the Co,rt held that this case sho,ld not +e incl,ded in the aforementioned e7ce-tion. &fter all% it was not the fa,lt of -etitioner that he lost his Co+ d,e to an act of illegal dismissal committed +y res-ondents. To r,le otherwise wo,ld +e ini8,ito,s to -etitioner and other ?)2s% and wo,ld% in eJect% send a wrong signal that -rinci-als>em-loyers and recr,itment>manning agencies may violate an ?)2Is sec,rity of ten,re which an em-loyment contract em+odies and act,ally -roAt from s,ch violation +ased on an ,nconstit,tional -rovision of law. SKIPPERS UNITED PACIFIC, INC. vs. DO&A, ET. AL. G.R. No. P###'% )BBRU&RS '% ($( )&CTS* S1i--ers United /aciAc% 3nc. de-loyed% in +ehalf of S1i--ers% De Gracia% Lata% and &-rosta to wor1 on +oard the vessel 54 2isdom Star. De Gracia% et al. claimed that S1i--ers failed to remit their res-ective allotments for almost Ave months% com-elling them to air their grievances with the Romanian Seafarers )ree Union.?n ! Decem+er ""'% 3T) 3ns-ector &drian 5ihalcioi, of the Romanian Seafarers Union sent Ca-tain Savvas of Cosmos Shi--ing a fa7 letter% relaying the com-laints of his crew% namely* home allotment delay% ,n-aid salaries ;only advances<% late -rovisions% lac1 of la,ndry services ;only one washing machine<% and lac1 of maintenance of the vessel ;-erforated and ,nre-aired dec1<.To date% however% S1i--ers only failed to remit the home allotment for the month of Decem+er ""'.?n (' .an,ary """% De Gracia% et al. were ,nceremonio,sly discharged from 54 2isdom Stars and immediately re-atriated.U-on arrival in the /hili--ines% De Gracia% et al. Aled a com-laint for illegal dismissal with the La+or &r+iter on @ &-ril """ and -rayed for -ayment of their home allotment for the month of Decem+er ""'% salaries for the ,ne7-ired -ortion of their contracts% moral damages% e7em-lary damages% and attorney6s fees. S1i--ers% on the other hand% claims% as evidenced +y a tele7 re-ort to S1i--ers that on : Decem+er ""'% De Gracia% smelling strongly of alcohol% went to the ca+in of Ga+riel ?lesRe1% 5aster of 54 2isdom Stars% and was r,de% sho,ting noisily to the master. 3t also claims that on (( .an,ary """% fo,r )ili-ino seafarers% namely &-rosta% De Gracia% Lata and DoRa% arrived in the master6s ca+in and demanded immediate re-atriation +eca,se they were not satisAed with the shi-% as evidenced +y a tele7 of Cosmoshi- 54 2isdom to S1i--ers% which however +ears conTicting dates of (( .an,ary ""' and (( .an,ary """. S1i--ers also claims that% d,e to the disem+ar1ation of De Gracia% et al.% P other seafarers disem+ar1ed ,nder a+normal circ,mstsances% which was again evidenced +y a fa7 of Cosmoshi- 54 2isdom to S1i--ers% which +ears conTicting dates of (@ .an,ary ""' and (@ .an,ary """. S1i--ers% in its /osition /a-er% also admitted non0-ayment of home allotment for the month of Decem+er $! F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch ""'% +,t -rayed for the oJsetting of s,ch amo,nt with the re-atriation e7-enses. Since De Gracia% et al. -re0terminated their contracts% S1i--ers claims they are lia+le for their re-atriation e7-ensesin accordance with Section ";G< of /hili--ine ?verseas Bm-loyment &dministration ;/?B&< 5emorand,m Circ,lar No. ##% series of ""! and f,rther -rayed for moral and e7em-lary damages. L& dismissed De Gracia% et al.6s com-laint for illegal dismissal +eca,se the seafarers vol,ntarily -re0terminated their em-loyment contracts +y demanding for immediate re-atriation d,e to dissatisfaction with the shi-. The La+or &r+iter held that s,ch vol,ntary -re0termination of em-loyment contract is a1in to resignation% a form of termination +y em-loyee of his em-loyment contract ,nder &rticle ('# of the La+or Code. The La+or &r+iter gave weight and credi+ility to the tele7 of the master of the vessel to S1i--ers. NRLC a9rmed L&Is decision. C& reversed the decisions of the La+or &r+iter and NLRC. 3SSUB* 2hether or not the seafarers were illegally dismissed or was there vol,ntary -re0termination of em-loyment contract. SC RUL3NG* )or a wor1er6s dismissal to +e considered valid% it m,st com-ly with +oth -roced,ral and s,+stantive d,e -rocess. The legality of the manner of dismissal constit,tes -roced,ral d,e -rocess% while the legality of the act of dismissal constit,tes s,+stantive d,e -rocess. /roced,ral d,e -rocess in dismissal cases consists of the twin re8,irements of notice and hearing. The em-loyer m,st f,rnish the em-loyee with two written notices +efore the termination of em-loyment can +e eJected* ;< the Arst notice a--rises the em-loyee of the -artic,lar acts or omissions for which his dismissal is so,ghtD and ;(< the second notice informs the em-loyee of the em-loyer6s decision to dismiss him. Before the iss,ance of the second notice% the re8,irement of a hearing m,st +e com-lied with +y giving the wor1er an o--ort,nity to +e heard. 3t is not necessary that an act,al hearing +e cond,cted. S,+stantive d,e -rocess% on the other hand% re8,ires that dismissal +y the em-loyer +e made ,nder a C,st or a,thoriRed ca,se ,nder &rticles ('( to ('@ of the La+or Code. 3n this case% there was no written notice f,rnished to De Gracia% et al. regarding the ca,se of their dismissal. Cosmoshi- f,rnished a written notice ;tele7< to S1i--ers% the local manning agency% claiming that De Gracia% et al. were re-atriated +eca,se the latter vol,ntarily -re0terminated their contracts. This tele7 was given credi+ility and weight +y the La+or &r+iter and NLRC in deciding that there was -re0termination of the em-loyment contract Ea1in to resignationE and no illegal dismissal. =owever% as correctly r,led +y the C&% the tele7 message is Ea +iased and self0serving doc,ment that does not satisfy the re8,irement of s,+stantial evidence.E 3f% indeed% De Gracia% et al. vol,ntarily -re0terminated their contracts% then De Gracia% et al. sho,ld have s,+mitted their written resignations. &rticle ('# of the La+or Code recogniRes termination +y the em-loyee of the em-loyment contract +y Eserving written notice on the em-loyer at least one ;< month in advance.E Given that -rovision% the law contem-lates the re8,irement of a written notice of resignation. 3n the a+sence of a written resignation% it is safe to -res,me that the em-loyer terminated the seafarers. 3n addition% the tele7 message relied ,-on +y the La+or &r+iter and NLRC +ore conTicting dates of (( .an,ary ""' and (( .an,ary """% giving do,+t to the veracity and a,thenticity of the doc,ment. 3n (( .an,ary ""'% De Gracia% et al. were not even em-loyed yet +y the foreign -rinci-al. )or these reasons% the dismissal of De Gracia% et al. was illegal. ?n the iss,e of home allotment -ay% S1i--ers eJectively admitted non0 remittance of home allotment -ay for the month of Decem+er ""' in its /osition /a-er. S1i--ers so,ght the re-atriation e7-enses to +e oJset with the home allotment -ay. =owever% since De Gracia% et al.6s dismissal was illegal% their re-atriation e7-enses were for the acco,nt of S1i--ers and co,ld not +e oJset with the home allotment -ay. Contrary to the claim of the La+or &r+iter and NLRC that the home allotment -ay is in Ethe nat,re of e7traordinary money where the +,rden of -roof is shifted to the wor1er who m,st -rove he is entitled to s,ch monetary +eneAt%E Section ' of /?B& 5emorand,m Circ,lar No. ##% series of ""!% states that the allotment act,ally constit,tes at least eighty -ercent ;'$Q< of the seafarer6s salary. /aragra-h ( of the em-loyment contracts of De Gracia% Lata and &-rosta incor-orated the -rovisions of a+ove 5emorand,m Circ,lar No. ##% series of ""!% in the em-loyment contracts. Since said memorand,m states that home allotment of seafarers $P F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch act,ally constit,tes at least eighty -ercent ;'$Q< of their salary% home allotment -ay is not in the nat,re of an e7traordinary money or +eneAt% +,t sho,ld act,ally +e considered as salary. . )or this reason% s,ch non0 remittance of home allotment -ay sho,ld +e considered as ,n-aid salaries% and S1i--ers shall +e lia+le to -ay the home allotment -ay of De Gracia% et al. for the month of Decem+er ""'. C& decision is &))3R5BD and S1i--ers United /aciAc% 3nc. and S1i--ers 5aritime Services 3nc.% Ltd. are Cointly and severally lia+le for -ayment of the following* < Unremitted home allotment -ay for the month of Decem+er ""' in its e8,ivalent rate in /hili--ine /esos at the time of termination on (' .an,ary """D (< Salary for the ,ne7-ired -ortion of the em-loyment contract or its c,rrent e8,ivalent in /hili--ine /esosD :< &ttorney6s fees and litigation e7-enses e8,ivalent to $Q of the total claims. INTERNATIONAL MANAGEMENT SERVICES vs. LOGARTA G.R. No. !:!#P% &/R3L '% ($( )&CTS* Recr,itment agency% 3nternational 5anagement Services ;35S<% owned and o-erated +y 5arilyn C. /asc,al% de-loyed res-ondent Roel /. Logarta to wor1 for /etrocon &ra+ia Limited ;/etrocon< in &l1ho+ar% Xingdom of Sa,di &ra+ia% in connection with general engineering services of /etrocon for the Sa,di &ra+ian ?il Com-any ;Sa,di &ramco<. Res-ondent was em-loyed for a -eriod of two ;(< years% commencing on ?cto+er (% ""P% with a monthly salary of eight h,ndred US Dollars ;US^'$$.$$<. ?n &-ril ("% ""'% Sa,di &ramco notiAed /etrocon that d,e to changes in the general engineering services wor1 forecast for ""'% the man0ho,rs that were formerly allotted to /etrocon is going to +e red,ced +y @$Q which constrained /etrocon to red,ce its -ersonnel. Th,s% on .,ne % ""'% /etrocon gave res-ondent a written notice informing the latter that d,e to the lac1 of -roCect wor1s related to his e7-ertise% he is given a :$0day notice of termination% and that his last day of wor1 with /etrocon will +e on .,ly % ""'. /etrocon also informed res-ondent that all d,e +eneAts in accordance with the terms and conditions of his em-loyment contract will +e -aid to res-ondent% incl,ding his tic1et +ac1 to the /hili--ines. Before his de-art,re from Sa,di &ra+ia% res-ondent received his Anal -aychec1 from /etrocon amo,nting SRP%@''.#P. U-on his ret,rn% res-ondent Aled a com-laint with the Regional &r+itration Branch 433% National La+or Relations Commission ;NLRC<% Ce+, City% against -etitioner as the recr,itment agency which em-loyed him for em-loyment a+road. 3n Aling the com-laint% res-ondent so,ght to recover his ,nearned salaries covering the ,ne7-ired -ortion of his em-loyment contract with /etrocon on the gro,nd that he was illegally dismissed. The La+or &r+iter rendered C,dgment in favor of the res-ondent and ordered -etitioner to -ay the -eso e8,ivalent of US^#%!$$.$$ +ased on the rate at the time of act,al -ayment% as -ayment of his wages for the ,ne7-ired -ortion of his contract of em-loyment. The NLRC on a--eal a9rmed the La+or &r+iterIs decision +,t red,ced the award to only US^@%'$$.$$ or its -eso e8,ivalent at the time of -ayment. The C& li1ewise dismissed the -etition and a9rmed the NLRC decision. 3SSUB* 2hether or not res-ondents dismissal thro,gh retrenchment illegal. SC RUL3NG* No Retrenchment is the red,ction of wor1 -ersonnel ,s,ally d,e to -oor Anancial ret,rns% aimed to c,t down costs for o-eration -artic,larly on salaries and wages. 3t is one of the economic gro,nds to dismiss em-loyees and is resorted +y an em-loyer -rimarily to avoid or minimiRe +,siness losses. Retrenchment -rograms are -,rely +,siness decisions within the -,rview of a valid and reasona+le e7ercise of management -rerogative. 3t is one way of downsiRing an em-loyer6s wor1force and is often resorted to +y the em-loyer d,ring -eriods of +,siness recession% ind,strial de-ression% or seasonal T,ct,ations% and d,ring l,lls in -rod,ction occasioned +y lac1 of orders% shortage of materials% conversion of the -lant for a new -rod,ction -rogram% or introd,ction of new methods or more e9cient machinery or a,tomation. 3t is a valid management -rerogative% -rovided it is done in good faith and the em-loyer faithf,lly com-lies with the s,+stantive and -roced,ral re8,irements laid down +y law and C,ris-r,dence. $' F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch /hili--ine Law recogniRes retrenchment as a valid ca,se for the dismissal of a migrant or overseas )ili-ino wor1er ,nder &rticle (': of the La+or Code. Th,s% retrenchment is a valid e7ercise of management -rerogative s,+Cect to the strict re8,irements set +y C,ris-r,dence% to wit* a< That the retrenchment is reasona+ly necessary and li1ely to -revent +,siness losses which% if already inc,rred% are not merely de minimis% +,t s,+stantial% serio,s% act,al and real% or if only e7-ected% are reasona+ly imminent as -erceived o+Cectively and in good faith +y the em-loyerD +< That the em-loyer served written notice +oth to the em-loyees and to the De-artment of La+or and Bm-loyment at least one month -rior to the intended date of retrenchmentD c< That the em-loyer -ays the retrenched em-loyees se-aration -ay e8,ivalent to one month -ay or at least >( month -ay for every year of service% whichever is higherD d< That the em-loyer e7ercises its -rerogative to retrench em-loyees in good faith for the advancement of its interest and not to defeat or circ,mvent the em-loyees6 right to sec,rity of ten,reD and e< That the em-loyer ,sed fair and reasona+le criteria in ascertaining who wo,ld +e dismissed and who wo,ld +e retained among the em-loyees% s,ch as stat,s%_e9ciency% seniority% -hysical Atness% age% and Anancial hardshi- for certain wor1ers. &--lying the a+ove0stated re8,isites for a valid retrenchment in the case at +ar% it is a--arent that the Arst% fo,rth and Afth re8,irements were com-lied with +y res-ondent6s em-loyer. =owever% the second and third re8,isites were a+sent when /etrocon terminated the services of res-ondent. &s a-tly fo,nd +y the NLRC and C,stly s,stained +y the C&% /etrocon e7ercised its -rerogative to retrench its em-loyees in good faith and the considera+le red,ction of wor1 allotments of /etrocon +y Sa,di &ramco was s,9cient +asis for /etrocon to red,ce the n,m+er of its -ersonnel. &s for the notice re8,irement% however% contrary to -etitioner6s contention% -ro-er notice to the D?LB within :$ days -rior to the intended date of retrenchment is necessary and m,st +e com-lied with des-ite the fact that res-ondent is an overseas )ili-ino wor1er. 3n the -resent case% altho,gh res-ondent was d,ly notiAed of his termination +y /etrocon :$ days +efore its eJectivity% no allegation or -roof was advanced +y -etitioner to esta+lish that /etrocon ever sent a notice to the D?LB :$ days +efore the res-ondent was terminated. Th,s% this re8,irement of the law was not com-lied with. 3n the case at +ar% des-ite the fact that res-ondent was em-loyed +y /etrocon as an ?)2 in Sa,di &ra+ia% still +oth he and his em-loyer are s,+Cect to the -rovisions of the La+or Code when a--lica+le. The +asic -olicy in this C,risdiction is that all )ili-ino wor1ers% whether em-loyed locally or overseas% enCoy the -rotective mantle of /hili--ine la+or and social legislations. &lso% res-ondent is entitled to the -ayment of his se-aration -ay. =owever% this Co,rt disagrees with the concl,sion of the La+or &r+iter% the NLRC and the C&% that res-ondent sho,ld +e -aid his se-aration -ay in accordance with the -rovision of Section $ of R.&. No. '$@(. & -lain reading of the said -rovision clearly reveals that it a--lies only to an illegally dismissed overseas contract wor1er or a wor1er dismissed from overseas em-loyment witho,t C,st% valid or a,thoriRed ca,se. n the case at +ar% notwithstanding the fact that res-ondent6s termination from his em-loyment was -roced,rally inArm% having not com-lied with the notice re8,irement% nevertheless the same remains to +e for a C,st% valid and a,thoriRed ca,se% i.e.% retrenchment as a valid e7ercise of management -rerogative. To stress% des-ite the em-loyer6s fail,re to com-ly with the one0month notice to the D?LB -rior to res-ondent6s termination% it is only a -roced,ral inArmity which does not render the retrenchment illegal. 3n &ga+on v. NLRC% this Co,rt r,led that when the dismissal is for a C,st ca,se% the a+sence of -ro-er notice sho,ld not n,llify the dismissal or render it illegal or ineJect,al. 3nstead% the em-loyer sho,ld indemnify the em-loyee for violation of his stat,tory rights. Conse8,ently% it is &rticle (': of the La+or Code and not Section $ of R.&. No. '$@( that is controlling. Th,s% res-ondent is entitled to -ayment of se-aration -ay e8,ivalent to one ;< month -ay% or at least one0half ;>(< month -ay for every year of service% whichever is higher. Considering that res-ondent was em-loyed +y /etrocon for a -eriod of eight ;'< months% he is entitled to receive one ;< month -ay as se-aration -ay. 3n addition% -,rs,ant to c,rrent C,ris-r,dence% for fail,re to f,lly com-ly with the stat,tory d,e -rocess of s,9cient notice% res-ondent is entitled to nominal damages in the amo,nt /#$%$$$.$$. $" F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch PERT(CPM MANPOWER E'PONENT CO., INC., VS. ARMANDO A. VINUY A, ET AL. G.R. N?. "P#('% SB/TB5BBR #% ($( )&CTS* ?n 5arch #% ($$'% res-ondents &rmando &. 4in,ya together with his co0 wor1ers ;res-ondents< Aled a com-laint for illegal dismissal against the -etitioner /ert>C/5 5an-ower B7-onent Co.% 3nc. ;agency<. The res-ondents alleged that the agency de-loyed them +etween 5arch ("% ($$P and 5ay (% ($$P to wor1 as al,min,m fa+ricator>installer for the agencyIs -rinci-al% 5etal Sol,tion LLC ;5odern 5etal< in D,+ai% United &ra+ Bmirates. The res-ondentsI em-loyment contracts% /?B&0a--roved two0 year em-loyment% nine ho,rs a day% salary of %:#$ &BD with overtime -ay% food allowance free ho,sing and la,ndry. The res-ondents claimed that they were shoc1ed to And o,t what their wor1ing and living conditions were in D,+ai. They were re8,ired to wor1 from !*:$ a.m. to !*:$ -.m.% with a +rea1 of only one ho,r to one and a half ho,rs. 2hen they rendered overtime wor1% they were most of the time either ,nder-aid or not -aid at all. S,+standard ho,sing% air -oll,ted and no -ota+le water. Defenses raised +y the agency that the res-ondents were not illegally dismissedD they vol,ntarily resigned from their em-loyment to see1 a +etter -aying Co+. 3t claimed that the res-ondents% while still wor1ing for 5odern 5etal% a--lied with another com-any which oJered them a higher -ay which did not materialiRe. The agency f,rther alleged that the res-ondents even vol,ntarily signed a9davits of 8,itclaim and release after they resigned. 3t th,s arg,ed that their claim for +eneAts% ,nder Section $ of Re-,+lic &ct No. ;R.&.< '$@(% damages and attorneyIs fees is ,nfo,nded. )he 'ompulsory Aritration Rulings ?n &-ril :$% ($$'% La+or &r+iter r,led in favor of the agency and held that there was no illegal dismissal +asing the decision the 8,it claims signed +y the wor1ers. The NLRC granted the a--eal. 3t r,led that the res-ondents had +een illegally dismissed. 3t stressed that it is illegal for an em-loyer to re8,ire its em-loyees to e7ec,te new em-loyment -a-ers% es-ecially those which -rovide +eneAts that are inferior to the /?B&0a--roved contracts% reCected the 8,itclaim and release e7ec,ted +y the res-ondents in D,+ai. 3t +elieved that the res-ondents e7ec,ted the 8,itclaim doc,ments ,nder d,ress as they were afraid that they wo,ld not +e allowed to ret,rn to the /hili--ines. )he 'A "ecision *** The C& dismissed the -etition for lac1 of merit. 3t ,-held the NLRC r,ling that the res-ondents were illegally dismissed. 3t fo,nd no grave a+,se of discretion in the NLRCIs reCection of the res-ondentsI resignation letters% and the accom-anying 8,itclaim and release a9davits% as -roof of their vol,ntary termination of em-loyment. The C& stressed that the Aling of a com-laint for illegal dismissal is inconsistent with resignation 3SSUBS* . C& in a9rming the NLRCIs Anding that the res-ondents were illegally dismissedD (. holding that the com-romise agreements +efore the /?B& -ertain only to the res-ondentsI charge of recr,itment violations against the agencyD :. a9rming the NLRCIs award to the res-ondents of their salaries for the ,ne7-ired -ortion of their em-loyment contracts% -,rs,ant to the Serrano r,ling. SC RUL3NG* 2e And no merit in the -etition. The C& committed no reversi+le error and neither did it commit grave a+,se of discretion in a9rming the NLRCIs illegal dismissal r,ling. The agency and its -rinci-al% 5odern 5etal% committed Tagrant violations of the law on overseas em-loyment% as well as +asic norms of decency and fair -lay in an em-loyment relationshi-% -,shing the res-ondents to loo1 for a +etter em-loyment and% ,ltimately% to resign from their Co+s. F3-st. The agency and 5odern 5etal are g,ilty of contract s,+stit,tion. Bm-loyees were hired for a longer three0year -eriod and a red,ced salary% from %:#$&BD to %$$$ &BD% among other -rovisions. Then% on 5ay #% ($$P% they were re8,ired to sign new em-loyment contracts:: reTecting the same terms contained in their a--ointment letters% e7ce-t that this time% they were hired as Kordinary la+orer%O no longer al,min,m $ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch fa+ricator>installer. The res-ondents com-lained with the agency a+o,t the contract s,+stit,tion% +,t the agency ref,sed or failed to act on the matter. 'learly0 the agency and &odern &etal committed a prohiited practice and engaged in illegal recruitment under the law! Article BD of the Laor 'ode pro%ides6 Art! BD! Prohiited Practices! +t shall e unlawful for any indi%idual0 entity0 licensee0 or holder of authority6 (i) )o sustitute or alter employment contracts appro%ed and %eri2ed y the "epartment of Laor from the time of actual signing thereof y the parties up to and including the periods of e8piration of the same without the appro%al of the Secretary of LaorI!J Lurther0 Article B4 of the Laor 'ode0 as amended y R!A! 4/D30BM de2ned Fillegal recruitmentG to include the following act6 (i) )o sustitute or alter to the pre$udice of the worker0 employment contracts appro%ed and %eri2ed y the "epartment of Laor and Employment from the time of actual signing thereof y the parties upto and including the period of the e8piration of the same without the appro%al of the "epartment of Laor and EmploymentI!J Se1,*+. The agency and 5odern 5etal committed +reach of contract .&ggravating the contract s,+stit,tion im-osed ,-on them +y their em-loyer% the res-ondents were made to s,Jer s,+standard ;shoc1ing% as they -,t it< wor1ing and living arrangements. Both the original contracts the res-ondents signed in the /hili--ines and the a--ointment letters iss,ed to them +y 5odern 5etal in D,+ai -rovided for free ho,sing and trans-ortation to and from the Co+site. The original contract mentioned free and s,ita+le ho,sing. &s earlier -ointed o,t% the res-ondents were made to wor1 from !*:$a.m. to !*:$ -.m.% with a meal +rea1 of one to one and a half ho,rs% and their overtime wor1 was mostly not -aid or ,nder-aid. Their living 8,arters were cram-ed as they shared them with (P other wor1ers. The lodging ho,se was in SharCah% far from the Co+site in D,+ai% leaving them only three to fo,r ho,rs of slee- every wor1day +eca,se of the long ho,rs of travel to and from their -lace of wor1% not to mention that there was no -ota+le water in the lodging ho,se which was located in an area where the air was -oll,ted. T03-+. 2ith their original contracts s,+stit,ted and their o--ressive wor1ing and living conditions ,nmitigated or ,nresolved% the res-ondentsI decision to resign is not s,r-rising. They were com-elled +y the dismal state of their em-loyment to give ,- their Co+sD eJectively% they were constr,ctively dismissed. & constr,ctive dismissal or discharge is Ka 8,itting +eca,se contin,ed em-loyment is rendered im-ossi+le% ,nreasona+le or ,nli1ely% as% an oJer involving a demotion in ran1 and a dimin,tion in -ay.O 2itho,t do,+t% the res-ondentsI contin,ed em-loyment with 5odern 5etal had +ecome ,nreasona+le. & reasona+le mind wo,ld not a--rove of a s,+stit,ted contract that -ays a diminished salary ] from :#$ &BD a month in the original contract to %$$$ &BD to %($$ &BD in the a--ointment letters% a diJerence of #$ &BD to (#$ &BD ;not C,st #$ &BD as the agency claimed< or an e7tended em-loyment ;from ( to : years< at s,ch inferior terms% or a Kfree and s,ita+leO ho,sing which is ho,rs away from the Co+ site% cram-ed and crowded% witho,t -ota+le water and e7-osed to air -oll,tion. 2e th,s cannot acce-t the agencyIs insistence that the res-ondents vol,ntarily resigned since they -ersonally -re-ared their resignation. 2e li1ewise And the a9davits of 8,itclaim and release which the res-ondents e7ec,ted s,s-ect. ?+vio,sly% the a9davits were -re-ared as a follow thro,gh of the res-ondentsI s,--osed vol,ntary resignation. Unli1e the resignation letters% the res-ondents had no hand in the -re-aration of the a9davits. They m,st have +een -re-ared +y a re-resentative of 5odern 5etal as they a--ear to come from a standard form and were a--arently introd,ced for only one -,r-ose ] to lend credence to the resignation letters. F,5-t0. The com-romise agreements ;with 8,itclaim and release< +etween the res-ondents and the agency +efore the /?B& did not foreclose their em-loyer0em-loyee relationshi- claims +efore the NLRC. The com-romise agreement% a--arently% was intended +y the agency as a settlement with the res-ondents and others with similar claims% which e7-lains the incl,sion of the two ;Nangolinolaand Gatchalian< who were not involved in the case with the NLRC. Under the circ,mstances% we cannot see how the com-romise agreements can +e considered to have f,lly settled the res-ondentsI claims +efore the NLRC illegal dismissal and F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch monetary +eneAts arising from em-loyment. 2e th,s And no reversi+le error nor grave a+,se of discretion in the reCection +y the NLRC and the C& of said agreements. F34t0. The agencyIs o+Cection to the a--lication of the Serrano r,ling in the -resent case is of no moment. 3ts arg,ment that the r,ling cannot +e given retroactive eJect% +eca,se it is c,rative and remedial% is ,ntena+le. 3t -oints o,t the Serrano r,ling which declared ,nconstit,tional the s,+Cect cla,se in Section $% -aragra-h # of R.&. '$@(% limiting to three months the -ayment of salaries to illegally dismissed ?verseas )ili-ino 2or1ers. Unda,nted% the agency -osits that in any event% the Serrano r,ling has +een n,lliAed +y R.&. No. $$((% entitled KAn Act Amending Repulic Act (o!4/D30 ,therwise Tnown as the &igrant Workers and ,%erseas Lilipinos Act of =??M0 As Amended0 Lurther +mpro%ing the Standard of Protection and Promotion of the Welfare of &igrant Workers0 )heir Lamilies and ,%erseas Lilipinos in "istress0 and Lor ,ther Purposes.O 3t arg,es that R.&. $$((% which la-sed into law ;witho,t the Signat,re of the /resident< on 5arch '% ($$% restored the s,+Cect cla,se in the # th -aragra-h% Section $ of R.&. '$@(. The amendment% contained in Section P of R.&. $$((% reads as follows* 3n case of termination of overseas em-loyment witho,t C,st% valid or a,thoriRed ca,se as deAned +y law or contract% or any ,n a,thoriRedded,ctions from the migrant wor1erIs salary% the wor1er shall +e entitled to the f,ll reim+,rsement KofO his -lacement fee and the ded,ctions made with interest at twelve -ercent ;(Q< per annum % -l,s his salaries for the ,ne7-ired -ortion of his em-loyment contract or for three ;:< months for every year of the ,ne7-ired term% whichever is less. This arg,ment fails to -ers,ade ,s. Laws shall have no retroactive eJect% ,nless the contrary is -rovided. By its very nat,re% the amendment introd,ced +y R.&. $$(( ] restoring a -rovision of R.&. '$@( declared ,nconstit,tional ] cannot +e given retroactive eJect% not only +eca,se there is no e7-ress declaration of retroactivity in the law% +,t +eca,se retroactive a--lication will res,lt in an im-airment of a right that had accr,ed to the res-ondents +y virt,e of the Serrano r,ling 0 entitlement to their salaries for the ,ne7-ired -ortion of their em-loyment contracts. 2hether or not R.&. $$(( is constit,tional is not for ,s to r,le ,-on in the -resent case as this isb an iss,e that is not s8,arely +efore ,s. 3n other words% this is an iss,e that awaits its -ro-er day in co,rtD in the meanwhile% we ma1e no -rono,ncement on it. C& decision a9rmed% -etition dismissed. XXVII. SOCIAL LEGISLATION SSS V. ALBA G.R. N?. !#@'(% .ULS (:% ($$' )&CTS* Sometime in ""% -etitioner &-olonio Lam+oso ;Lam+oso< Aled a claim for retirement +eneAt +efore the Social Sec,rity System ;SSS<. =owever% his claim was denied on the gro,nd that he co,ld not 8,alify for monthly -ension ,nder Re-,+lic &ct ;R.&.< No. ! ;the Social Sec,rity &ct of "#@< as he then had only thirty0nine ;:"< -aid contri+,tions. Lam+oso a--ealed the denial of his claim +y Aling a -etition +efore the Commission wherein he alleged that he sho,ld +e entitled to monthly retirement -ension. &-olonio Lam+oso herein alleged that he wor1ed in =da. La Roca ;owned +y )ar &l+a< from "!$ to "P: as aca+o%I in =da. &li+asao from "P: to "P" as overseer and in =da. Xamandag from "P" to "'@D that the latter two ;(< haciendas are +oth owned +y Ramon S. BenedictoD and that when he Aled a claim for retirement -ension +eneAt with the SSS% however% the same was denied on the gro,nd that he had :" monthly contri+,tions to his credit. The Commission ordered )ar &l+a to -ay to the SSS the delin8,ent monthly contri+,tions of &-olonio Lam+oso from .,ne '% "!$ to &-ril "P:D Ramon Benedicto to -ay to SSS the delin8,ent monthly contri+,tions d,e the -etitioner for the -eriod 5ay "P: to "'@. The SSS% on the other hand% is ordered to -ay &-olonio Lam+oso his retirement +eneAt ,-on the Aling of the claim therefor% s,+Cect to e7isting r,les and reg,lations% and to inform this Commission of its com-liance herewith. &l+a s,+se8,ently Aled a /etition for Review +efore the Co,rt of &--eals. The Co,rt of &--eals reversed and set aside +oth the resol,tion and the order of the Commission. 3t held that )ar &l+a cannot +e considered as an em-loyer of Lam+oso -rior to "P$ +eca,se as administrator of the family0 owned hacienda% he is not an em-loyer ,nder Section ';c< of the Social Sec,rity &ct of "#@ who carries on a Etrade or +,siness% ind,stry% ,nderta1ing or activity of any 1ind and ,ses the services of another -erson ( F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch who is ,nder his orders as regards the em-loyment%E ,nli1e ,nder &rticle ((;e< of the La+or Code which deAnes an em-loyer as% among others% any -erson acting directly or indirectly in the interest of the em-loyer. &s s,ch% the a--ellate co,rt declared% )ar &l+a had no o+ligation to remit to SSS the monthly contri+,tions of Lam+oso -rior to "P$. 3SSUB* 2hether an administrator co,ld +e considered an em-loyer within the sco-e of the Social Sec,rity &ct of "#@. =BLD* 2e answer in the a9rmative. )irst% the Co,rt o+serves that )ar &l+a was no ordinary administrator. =e was no less than the son of the haciendaIs owner and as s,ch he was an owner0in0waiting -rior to his fatherIs death. =e was a mem+er of the ownerIs family assigned to actively manage the o-erations of the hacienda. &s he stood to +eneAt from the haciendaIs s,ccessf,l o-eration% he inel,cta+ly too1 his Co+ and his fatherIs wishes to heart. &s em-hasiRed +y the Commission his and the ownerIs interests in the +,siness were -lainly and ine7trica+ly lin1ed +y Alial +ond. =e more than C,st acted in the interests of his father as em-loyer% and co,ld himself -ass oJ as the em-loyer% the one carrying on the ,nderta1ing. Second% nomenclat,re aside% )ar &l+a was not merely an administrator of the hacienda. &--lying the control test which is ,sed to determine the e7istence of em-loyer0em-loyee relationshi- for -,r-oses of com-,lsory coverage ,nder the SSS law% )ar &l+a is technically Lam+osoIs em-loyer. The essential elements of an em-loyer0em-loyee relationshi- are* ;a< the selection and engagement of the em-loyeeD ;+< the -ayment of wagesD ;c< the -ower of dismissalD and ;d< the -ower of control with regard to the means and methods +y which the wor1 is to +e accom-lished% with the -ower of control +eing the most determinative factor. Lam+oso testiAed that he was selected and his services were engaged +y )ar &l+a himself. Corollarily% )ar &l+a held the -rerogative of terminating Lam+osoIs em-loyment. Lam+oso also testiAed in a direct manner that he had +een -aid his wages +y )ar &l+a. This testimony was seconded +y Lam+osoIs co0wor1er% Rodolfo Sales. &nent the -ower of control with regard to the wor1 of the em-loyee% the element refers merely to the e7istence of the -ower and not the act,al e7ercise thereof. 3t is not essential for the em-loyer to act,ally s,-ervise the -erformance of d,ties of the em-loyeeD it is s,9cient that the former has a right to wield the -ower. Third% not to +e forgotten is the deAnition of an em-loyer ,nder &rticle !P;f< of the La+or Code which deals with em-loyeesI com-ensation and state ins,rance f,nd. The said -rovision of the law deAnes an em-loyer as Eany -erson% nat,ral or C,ridical% em-loying the services of the em-loyee.E 3t also deAnes a -erson as Eany individ,al% -artnershi-% Arm% association% tr,st% cor-oration or legal re-resentative thereof.E /lainly% )ar &l+a% as the hacienda administrator% acts as the legal re-resentative of the em-loyer and is th,s an em-loyer within the meaning of the law lia+le to -ay the SS contri+,tions. )inally% the Co,rt +elieves that Section ';c< of the Social Sec,rity &ct of "#@ is +road eno,gh to incl,de those -ersons acting directly or indirectly in the interest of the em-loyer. &s -ointed o,t +y the Co,rt of &--eals% that the said -rovision does not contain the deAnitive -hrase contained in &rticle ((;e< of the La+or Code sho,ld not +e ta1en to mean that administrators s,ch as )ar &l+a% whose interests are closely lin1ed with his father0em-loyer% do not come within the -,rview of the law. 3f ,nder &rticle ((;e<% -ersons acting in the interest of the em-loyer% directly or indirectly% are o+liged to follow the government la+or relations -olicy% it co,ld +e reasona+ly concl,ded that s,ch -ersons may li1ewise +e held lia+le for the remittance of SS contri+,tions which is an o+ligation created +y law and an is em-loyeeIs right -rotected +y law. MARLENE L. RODRIN vs. GOVERNMENT SERVICE INSURANCE SYSTEM G.R. No. !(':P% .,ly ('% ($$' )&CTS* /etitioner 5arlene L. Rodrin Aled a claim for com-ensation +eneAts ,nder /residential Decree !(!% as amended% relative to the death of her h,s+and S/? )eli7+erto 5. Rodrin +efore the GS3S. 3n a letter dated Decem+er ($% ($$$% the Government Service 3ns,rance System denied -etitioner6s claim for com-ensation +eneAts ,nder /residential Decree !(!% as amended% on the gro,nd that the death of S/? )eli7+erto 5. Rodrin did not arise o,t nor was it in the co,rse of his em-loyment. : F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch U-on a--eal to the BCC% the Commission a9rmed the decision of the GS3S. C& had dismissed the /etition for Review Aled +y Rodrin and it li1ewise denied her 5otion for Reconsideration. 3SSUB* 2hether the death of Senior /olice ?9cer ;S/?< Rodrin is com-ensa+le ,nder the -rovisions of /residential Decree ;/.D.< No. !(! as amended. =BLD* The Co,rt Ands the death of S/? Rodrin com-ensa+le ,nder the -rovisions of /D !(! as amended. )or the com-ensa+ility of an inC,ry to an em-loyee which res,lts in his disa+ility or death% Section ;a<% R,le 333 of the &mended R,les on Bm-loyees6 Com-ensation im-oses the following conditions* . The em-loyee m,st have +een inC,red at the -lace where his wor1 re8,ired him to +eD (. The em-loyee m,st have +een -erforming his o9cial f,nctionsD and :. 3f the inC,ry was s,stained elsewhere% the em-loyee m,st have +een e7ec,ting an order of the em-loyer. The Arst condition has +een met +y -etitioner. The GS3S and the BCC as well as the C& acce-ted the claim that S/? Rodrin may have +een in the line of d,ty or on a s,rveillance mission at the time and -lace of his shooting. The BCC conceded that there was no 8,estion that S/? Rodrin was a mem+er of the /N/ at the time of his deathD and that +eing so% he was considered to +e at his -lace of wor1 regardless of whether or not he was Eon or oJ0d,ty.E Both assertions are correctly +ased on this Co,rt6s r,ling in Government Service 3ns,rance System v. Co,rt of &--eals that mem+ers of the national -olice% ,nless they are on o9cial leave% are% +y the nat,re of their f,nctions% technically on d,ty (@ ho,rs a day% +eca,se -olicemen are s,+Cect to call at any time and may +e as1ed +y their s,-eriors or +y any distressed citiRen to assist in maintaining the -eace and sec,rity of the comm,nity. &nent the second and third conditions% the GS3S% BCC and the C& fo,nd that S/? Rodrin% at the time of his death% was not in the -erformance of his o9cial d,ties -,rs,ant to an o9cial order from his s,-erior. The GS3S and the BCC concl,ded that the death of S/? Rodrin is not com-ensa+le ,nder the -rovisions of /.D. No. !(! as his death did not arise from% nor was it in the co,rse of% his em-loyment. =owever% +oth the GS3S and the BCC did not ela+orate on how they arrived at s,ch a concl,sion. ?n the other hand% the C& itself fo,nd that -etitioner s,9ciently esta+lished that her h,s+and was on a mission and was cond,cting s,rveillance when he was 1illedD +,t% nonetheless% the C& concl,ded that S/? Rodrin was not -erforming his o9cial f,nctions nor was he e7ec,ting an order for his em-loyer at the time of his death. Section :;m<% R,le : of the R,les of Co,rt -rovides the -res,m-tion that o9cial d,ty has +een reg,larly -erformed. The said R,le treats this -res,m-tion as satisfactory ,nless contradicted and overcome +y other evidence. The Co,rt is not -ers,aded +y the contention of the ?SG and the GS3S that S/? Rodrin6s reason or reasons for intending to go to San /edro% Lag,na involved a -,rely -rivate matter% as this is -,re s-ec,lation. There is nothing in the X,sang Loo+ na Salaysay of his +rothers0in0law to indicate that their +,siness in going to San /edro was not related to S/? RodrinIs wor1 as an intelligence o9cer. 3t sho,ld +e noted that% at the time of his death% he came from Carmona% Cavite which is a -lace s-eciAed in the Letter0?rders from his s,-erior. 5oreover% he was 1illed in BiVan% which is also a -lace s-eciAed in the said Letter0?rders. ),rthermore% he was 1illed on .,ly @% ($$$ which is within the -eriod a,thoriRed +y the s,+Cect Letter0 ?rders for him to cond,ct s,rveillance% monitoring and arrest. ?ther than the fact the S/? Rodrin had intended to go to San /edro% Lag,na% a -lace which is not covered +y his Letter0?rders% there is no +asis to concl,de that S/? Rodrin6s +,siness in going to San /edro was -rivate in nat,re and was not related to his Co+ as an intelligence o9cer of the /N/. 3ntelligence wor1 covers a +road s-ectr,m of activities that% more often than not% wo,ld necessarily involve secret -lans or ,ne7-ected co,rses of action to attain its o+Cectives. 2ith res-ect to the contention that San /edro% Lag,na was a -lace which was not covered +y the s,+Cect Letter0?rders% the Co,rt ta1es cogniRance of the fact that the nat,re of wor1 of a -olice o9cer who is an intelligence o-erative does not conAne him to s-eciAc -laces and ho,rs% more so with res-ect to a -olice o9cer involved in intelligence wor1. =is actions may not +e com-artmentaliRed% as they de-end to a large e7tent on the e7igencies of the assignment given him. 3n the -resent case% the fact that the Letter0 @ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch ?rders indicated the -ossi+le location of the criminal s,s-ects he was tas1ed to a--rehend does not limit the cond,ct of his o-eration within the +o,ndaries of these -laces. =e was not -revented from immediately going to other locations if he had gathered information that these criminal elements were in said -laces. =ence% to concl,de that S/? Rodrin was not in the -erformance of his o9cial d,ty sim-ly +eca,se% at the time of his death% he was then on his way to a -lace which was not s-eciAed in the s,+Cect Letter0?rders is a+sol,tely erroneo,s. 3n the a+sence of s,9cient evidence to -rove otherwise% the -res,m-tion that S/? Rodrin was in the reg,lar -erformance of his o9cial d,ty when he was 1illed remains. 3n addition% res-ondents% incl,ding the C&% dwelt on s-ec,lations and s,rmises when they concl,ded that S/? Rodrin was not -erforming his o9cial f,nctions when he was shot. The fact that the BiVan /olice failed to state in their 3nvestigation Re-ort dated .,ly P% ($$$ that S/? Rodrin was on o9cial mission when he was 1illed does not militate against the claim of herein -etitioner. The 3nvestigation Re-ort of the BiVan /olice foc,sed only on the shooting incident and the circ,mstances s,rro,nding the death of S/? Rodrin. The a+sence of any statement or indication which shows that S/? Rodrin was then on o9cial mission does not mean that he% in fact% was not in the co,rse of -erforming his d,ties as o,tlined in the s,+Cect Letter0?rders. There is no evidence to -rove the claims of res-ondents that the matter S/? Rodrin was attending to when he was shot to death was intrinsically -rivate and ,no9cial in nat,re. The fact remains that he died at a -lace and within the time s-eciAed in his Letter0?rders. Th,s% in the a+sence of contrary evidence% /? Rodrin is -res,med to +e in the -erformance of his o9cial d,ties at the time of his death. The arg,ment that the ca,se of S/? Rodrin6s death was not in any way related to his mission as o,tlined in the s,+Cect Letter0?rders is not -la,si+le. 3n the -resent case% evidence shows that% at the time that S/? Rodrin was g,nned down% he was -erforming his d,ty as a -olice o9cer. The 3nvestigation Re-ort of the BiVan /N/ as well as the X,sang Loo+ na Salaysay of +oth the +rothers0in0law of S/? Rodrin show that when the latter was shot to death he was in the co,rse of in8,iring why the sec,rity g,ards of the s,+division they were -assing thro,gh were aiming their g,ns at them. &t that -oint% it cannot +e denied that he was ca,ght in a sit,ation where he co,ld not avoid e7ercising his a,thority and d,ty as -oliceman to maintain -eace and sec,rity of the comm,nity. 2hile his main mission was to a--rehend certain criminal elements named in the s,+Cect Letter0?rders% he was not e7c,sed from -erforming his +asic f,nction as a -eace o9cer. =is act of trying to And o,t the reason why the sec,rity g,ards were acting hostile cannot +e said to +e foreign and ,nrelated to his Co+ as a mem+er of the -olice force. )inally it is well to echo the Co,rt6s r,ling in Bm-loyeesI Com-ensation Commission v. Co,rt of &--eals% wherein it was held that* 7 7 7 in case of do,+t% the sym-athy of the law on social sec,rity is toward its +eneAciaries% and the law% +y its own terms% re8,ires a constr,ction of ,tmost li+erality in their favor. )or this reason% this Co,rt lends a very sym-athetic ear to the cries of the -oor widows and or-hans of -olice o9cers. 3f we m,st demand 0 as we o,ght to strict acco,nta+ility from o,r -olicemen in safeg,arding -eace and order day and night% we m,st also to the same e7tent +e ready to com-ensate their loved ones who% +y their ,ntimely death% are left witho,t any means of s,--orting themselves. GSIS VS CASCO G.R. N?.P:@:$% .ULS ('% ($$' )&CTS* Teacher Casco was diagnosed to +e hy-ertensive in ""@ and e7-erienced attac1s in ""# and """ which forced him to retire from the government service at an early age. =e re8,ested GS3S to convert his /ermanent /artial Disa+ility ;//D< to /ermanent Total Disa+ility ;/TD< -,rs,ant to /D !(! +,t the same was denied. 3SSUB* 2?N res-ondentIs claim for conversion of //D to /TD sho,ld +e granted. RUL3NG* The Co,rt held that denying res-ondent Casco the /TD +eneAts to which he is indis-,ta+ly entitled% who had rendered more than ( years of service +,t was forced to retire d,e to his ailment% wo,ld +e contrary to the s-irit of /D !(! and the social C,stice -rinci-le enshrined in the Constit,tion. SSS V. DE LOS SANTOS G.R. N?. !@P"$.&UGUST ("% ($$' # F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch )&CTS* Res-ondent Gloria de los Santos and &ntonio de los Santos were married in "!@. Then% she left &ntonio and contracted another marriage with a certain Domingo. Sometime in "!"% Gloria went +ac1 to &ntonio and lived with him ,ntil "':. They had three children. 3n "':% Gloria left &ntonio and went to the US. 3n "'!% she Aled for divorce against &ntonio with the S,-erior Co,rt of ?range% Sta. &na% California. The divorce was granted. Thereafter% +oth of them contracted s,+se8,ent marriages. &ntonio married Cirila% and their ,nion -rod,ced one child% 5ay0&nn. ?n the other hand% Gloria married an &merican citiRen in the US. 3n "'"% &ntonio amended his records at ;SSS<. =e changed his +eneAciaries from 5rs. 5argarita de los Santos to CirilaD from Gloria to 5ay0 &nnD and from Brlinda to &rmine de los Santos. &ntonio retired in ""!% and from then on +egan receiving monthly -ension. =e died in """. U-on his death% Cirila a--lied for and +egan receiving his SSS -ension +eneAt .?n the other hand% res-ondent Aled a claim for &ntonioIs death +eneAts with the SSS. =er claim was denied +eca,se she was not a 8,aliAed +eneAciary of &ntonio. These circ,mstances are s,9cient gro,nd for denial as the SSS law s-eciAcally deAnes +eneAciaries as Ethe de-endent s-o,se% ,ntil he or she remarries% the de-endent legitimate% legitimated or legally ado-ted and illegitimate children who shall +e the -rimary +eneAciary.E 7 7 7( Gloria elevated her claim to the ;SSC<. =owever% her -etition was dismissed. C& a9rmed SSCIs resol,tion. 3SSUB* 2?N RBS/?NDBNT 3S ST3LL YU&L3)3BD &S & /R35&RS BBNB)3C3&RS ?) DBCB&SBD SSS 5B5BBR &NT?N3?% UNDBR SBCT3?N (0B 3N RBL&T3?N T? SBCT3?N ';e< and ;1< ?) T=B SS L&2. =BLD* The rec1oning -oint in determining the +eneAciaries of the deceased &ntonio sho,ld +e the time of his death. There is no need to loo1 into the time of his retirement% as was the co,rse followed +y the SSC in resolving the claim of res-ondent. 3n deciding that death +eneAts sho,ld not +e denied to the wife who was married to the deceased retiree only after the latterIs retirement% this Co,rt in Dycaico reasoned* 7 7 7 3n -artic,lar% the -roviso was a--arently intended to -revent sham marriages or those contracted +y -ersons solely to ena+le one s-o,se to claim +eneAts ,-on the antici-ated death of the other s-o,se. 7 7 7 =owever% classifying de-endent s-o,ses and determining their entitlement to s,rvivorIs -ension +ased on whether the marriage was contracted +efore or after the retirement of the other s-o,se% regardless of the d,ration of the said marriage% +ears no relation to the achievement of the -olicy o+Cective of the law% i.e.% E-rovide meaningf,l -rotection to mem+ers and their +eneAciaries against the haRard of disa+ility% sic1ness% maternity% old age% death and other contingencies res,lting in loss of income or Anancial +,rden.E 7 7 7 &s fo,nd +y +oth the SSC and the C&% the divorce o+tained +y res-ondent against the deceased &ntonio was not +inding in this C,risdiction. Under /hili--ine law% only aliens may o+tain divorces a+road% -rovided they are valid according to their national law. The divorce was o+tained +y res-ondent Gloria while she was still a )ili-ino citiRen and th,s covered +y the -olicy against a+sol,te divorces. 3t did not sever her marriage ties with &ntonio. =owever% altho,gh res-ondent was the legal s-o,se of the deceased% 2e And that she is still dis8,aliAed to +e his -rimary +eneAciary ,nder the SS Law. She fails to f,lAll the re8,irement of de-endency ,-on her deceased h,s+and &ntonio. Social Sec,rity System v. &g,as is instr,ctive in determining the e7tent of the re8,ired Ede-endencyE ,nder the SS Law. 3n &g,as% the Co,rt r,led that altho,gh a h,s+and and wife are o+liged to s,--ort each other% whether one is act,ally de-endent for s,--ort ,-on the other cannot +e -res,med from the fact of marriage alone. 777 de-endent as Eone who derives his or her main s,--ort from another. 5eaning% relying on% or s,+Cect to% someone else for s,--ortD not a+le to e7ist or s,stain oneself% or to -erform anything witho,t the will% -ower% or aid of someone else.E 3t sho,ld +e noted that the GS3S law li1ewise deAnes ade-endent s-o,se as Ethe legitimate s-o,se de-endent for s,--ort ,-on the mem+er or -ensioner.E 3n that case% the Co,rt fo,nd it o+vio,s that a ! F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch wife who a+andoned the family for more than P years ,ntil her h,s+and died% and lived with other men% was not de-endent on her h,s+and for s,--ort% Anancial or otherwise% d,ring that entire -eriod. =ence% the Co,rt denied her claim for death +eneAts. 3n Ane% these ,ncontroverted facts remove her from 8,alifying as a -rimary +eneAciary of her deceased h,s+and. 2=BRB)?RB% the -etition is GR&NTBD and the a--ealed Decision RB4BRSBD and SBT &S3DB. The Resol,tion of the Social Sec,rity Commission is RB3NST&TBD. BECMEN SERVICE E'PORTER AND PROMOTION, INC., vs. CUARESMA G.R. Nos. '("P'0P"% &-ril P% ($$" )&CTS* .asmin C,aresma ;.asmin< was de-loyed +y Becmen Service B7-orter and /romotion% 3nc. ;Becmen< to serve as assistant n,rse in &l0Bir1 =os-ital in the Xingdom of Sa,di &ra+ia ;XS&<% for a contract d,ration of three years% with a corres-onding salary of US^(@P.$$ -er month. ?ver a year later% she died allegedly of -oisoning. .essie )aCardo% a co0wor1er of .asmin% narrated that .asmin was fo,nd dead +y a female cleaner lying on the Toor inside her dormitory room with her mo,th foaming and smelling of -oison. .asminIs +ody was re-atriated to 5anila. The following day% the City =ealth ?9cer of Ca+anat,an City cond,cted an a,to-sy and the res,lting medical re-ort indicated that .asmin died ,nder violent circ,mstances% and not -oisoning as originally fo,nd +y the XS& e7amining -hysician. .asminIs remains were e7h,med and e7amined +y the National B,rea, of 3nvestigation ;NB3<. The to7icology re-ort of the NB3% however% tested negative for non0volatile% metallic -oison and insecticides. The C,aresmas Aled a com-laint against Becmen and its -rinci-al in the XS&% RaCa+ U Silsilah Com-any ;RaCa+<% claiming death and ins,rance +eneAts% as well as moral and e7em-lary damages for .asminIs death. 3n their com-laint% the C,aresmas claim that .asminIs death was wor10 related% having occ,rred at the em-loyerIs -remises% that ,nder .asminIs contract with Becmen% she is entitled to Ei8ama ins,ranceE coverageD that .asmin is entitled to com-ensatory damages. Becmen and RaCa+ insist that .asmin committed s,icide% citing a -rior ,ns,ccessf,l s,icide attem-t sometime in 5arch or &-ril ""' and relying on the medical re-ort of the e7amining -hysician of the &l0Bir1 =os-ital. They li1ewise deny lia+ility +eca,se the C,aresmas already recovered death and other +eneAts. They insist that the C,aresmas are not entitled to Ei8ama ins,ranceE +eca,se this refers to the Eiss,anceE not ins,rance of i8ama% or residency>wor1 -ermit re8,ired in the XS&. Becmen Aled a manifestation and motion for s,+stit,tion alleging that RaCa+ terminated their agency relationshi- and had a--ointed 2hite )alcon Services% 3nc. ;2hite )alcon< as its new recr,itment agent in the /hili--ines. Th,s% 2hite )alcon was im-leaded as res-ondent as well% and it ado-ted and reiterated BecmenIs arg,ments in the -osition -a-er it s,+se8,ently Aled. The La+or &r+iter ;L&< r,led against the C,aresmas giving weight on the evidence that .asmine died of -oisoning% th,s% she commited s,icide. ?n the other hand% NLRC reversed the decicion of L& and +elieved on the Andings that on the evidence add,ced% was the victim of com-ensa+le wor10connected criminal aggression. 3SSUB* . 2hether the a+sence of any ins,rance -rovisions in case of death -recl,de the C,aresmas from recovery for monetary +eneAt. (. 2hether the fail,re of the em-loyer to assist in ,nravelling the case and f,rther averting lia+ility violates the social legislation laws. :. 2hether S-o,ses C,aresmas are entitled to moral and e7em-lary damages. RUL3NG* NO% it will not -recl,de recovery. The terms and conditions of .asminIs ""! Bm-loyment &greement does not incl,de -rovisions for ins,rance% or for accident% death or other +eneAts that the C,aresmas see1 to recover% and which the la+or tri+,nals and a--ellate co,rt granted varia+ly in the g,ise of com-ensatory damages. P F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch =owever% the a+sence of -rovisions for social sec,rity and other +eneAts does not ma1e .asminIs em-loyment contract inArm. Under XS& law% her foreign em-loyer is not o+liged to -rovide her these +eneAtsD and neither is .asmin entitled to minim,m wage ,nless of co,rse the XS& la+or laws have +een amended to the o--osite eJect% or that a +ilateral wage agreement has +een entered into. .asmineIs death was not wor1 connected. &t the time of her death% she was not on d,ty% or else evidence to the contrary wo,ld have +een add,ced. Neither was she within hos-ital -remises at the time. 3nstead% she was at her dormitory room on -ersonal time when she died. Neither has it +een shown% nor does the evidence s,ggest% that at the time she died% .asmin was -erforming an act reasona+ly necessary or incidental to her em-loyment as n,rse% +eca,se she was at her dormitory room. 3t is not fair to re8,ire em-loyers to answer even for their em-loyeesI -ersonal time away from wor1% which the latter are free to s-end of their own choosing. 2hether they choose to s-end their free time in the -,rs,it of safe or -erilo,s ,nderta1ings% in the com-any of friends or strangers% lovers or enemies% this is not one area which their em-loyers sho,ld +e made acco,nta+le for. 2hile we have em-hasiRed the need to o+serve o9cial wor1 time strictly% what an em-loyee does on free time is +eyond the em-loyerIs s-here of in8,iry. 2hile the Eem-loyerIs -remisesE may +e deAned very +roadly not only to incl,de -remises owned +y it% +,t also -remises it leases% hires% s,--lies or ,ses% we are not -re-ared to r,le that the dormitory wherein .asmin stayed sho,ld constit,te em-loyerIs -remises as wo,ld allow a Anding that death or inC,ry therein is considered to have +een inc,rred or s,stained in the co,rse of or arose o,t of her em-loyment. There are certainly e7ce-tions% +,t they do not a--ear to a--ly here. 5oreover% a com-lete determination wo,ld have to de-end on the ,ni8,e circ,mstances o+taining and the overall fact,al environment of the case% which are here lac1ing. YES. Under Re-,+lic &ct No. '$@( ;R.&. '$@(<% or the 5igrant 2or1ers and ?verseas )ili-inos &ct of ""#% the State shall% at all times% ,-hold the dignity of its citiRens whether in co,ntry or overseas% in general% and )ili-ino migrant wor1ers% in -artic,lar. The State shall -rovide ade8,ate and timely social% economic and legal services to )ili-ino migrant wor1ers. The rights and interest of distressed overseas )ili-inos% in general% and )ili-ino migrant wor1ers% in -artic,lar% doc,mented or ,ndoc,mented% are ade8,ately -rotected and safeg,arded. Becmen and 2hite )alcon% as licensed local recr,itment agencies% misera+ly failed to a+ide +y the -rovisions of R.&. '$@(. Recr,itment agencies are e7-ected to e7tend assistance to their de-loyed ?)2s% es-ecially those in distress. 3nstead% they a+andoned .asminIs case and allowed it to remain ,nsolved to f,rther their interests and avoid antici-ated lia+ility which -arents or relatives of .asmin wo,ld certainly e7act from them. They willf,lly ref,sed to -rotect and tend to the welfare of the deceased .asmin% treating her case as C,st one of those ,nsolved crimes that is not worth wasting their time and reso,rces on. The evidence does not even show that Becmen and RaCa+ lifted a Anger to -rovide legal re-resentation and see1 an investigation of .asminIs case. 2orst of all% they ,nnecessarily tram-led ,-on the -erson and dignity of .asmin +y standing -at on the arg,ment that .asmin committed s,icide% which is a grave acc,sation given its ,n0Christian nat,re. 3n 3nterorient 5aritime Bnter-rises% 3nc. v. NLRC% a seaman who was +eing re-atriated after his em-loyment contract e7-ired% failed to ma1e his Bang1o1 to 5anila connecting Tight as he +egan to wander the streets of Bang1o1 aimlessly. =e was shot to death +y Thai -olice fo,r days after% on acco,nt of r,nning am,c1 with a 1nife in hand and threatening to harm any+ody within sight. The em-loyer% s,ed for death and other +eneAts as well as damages% inter-osed as defense the -rovision in the seafarer agreement which -rovides that Eno com-ensation shall +e -aya+le in res-ect of any inC,ry% inca-acity% disa+ility or death res,lting from a willf,l act on his own life +y the seaman.E The Co,rt reCected the defense on the view% among others% that the recr,itment agency sho,ld have o+served some -reca,tionary meas,res and sho,ld not have allowed the seaman% who was later on fo,nd to +e mentally ill% to travel home alone% and its fail,re to do so rendered it lia+le for the seamanIs death. 2e r,led therein that )he foreign employer may not ha%e een oligated y its contract to pro%ide a companion for a returning employee0 ut it cannot deny that it was e8pressly tasked y its agreement to assure the safe return of said worker! )he uncaring attitude displayed y petitioners who0 knowing fully well that its employee had een suAering from some mental disorder0 ne%ertheless still allowed him to tra%el home alone0 is appalling to say the least! Such attitude harks ack to another time when the landed gentry ' F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch practically owned the serfs0 and disposed of them when the latter had grown old0 sick or otherwise lost their usefulness! (Emphasis supplied) 2hether em-loyed locally or overseas% all )ili-ino wor1ers enCoy the -rotective mantle of /hili--ine la+or and social legislation% contract sti-,lations to the contrary notwithstanding. This -rono,ncement is in 1ee-ing with the +asic -,+lic -olicy of the State to aJord -rotection to la+or% -romote f,ll em-loyment% ens,re e8,al wor1 o--ort,nities regardless of se7% race or creed% and reg,late the relations +etween wor1ers and em-loyers. This r,ling is li1ewise rendered im-erative +y &rticle P of the Civil Code which states that laws which have for their o+Cect -,+lic order% -,+lic -olicy and good c,stoms shall not +e rendered ineJective +y laws or C,dgments -rom,lgated% or +y determinations or conventions agreed ,-on in a foreign co,ntry. The relations +etween ca-ital and la+or are so im-ressed with -,+lic interest% and neither shall act o--ressively against the other% or im-air the interest or convenience of the -,+lic. 3n case of do,+t% all la+or legislation and all la+or contracts shall +e constr,ed in favor of the safety and decent living for the la+orer. YES. The C,aresmas are entitled to moral damages% which Becmen and 2hite )alcon are Cointly and solidarily lia+le to -ay% together with e7em-lary damages for wanton and o--ressive +ehavior% and +y way of e7am-le for the -,+lic good. /rivate em-loyment agencies are held Cointly and severally lia+le with the foreign0+ased em-loyer for any violation of the recr,itment agreement or contract of em-loyment. This Coint and solidary lia+ility im-osed +y law against recr,itment agencies and foreign em-loyers is meant to ass,re the aggrieved wor1er of immediate and s,9cient -ayment of what is d,e him. 3f the recr,itment>-lacement agency is a C,ridical +eing% the cor-orate o9cers and directors and -artners as the case may +e% shall themselves +e Cointly and solidarily lia+le with the cor-oration or -artnershi- for the aforesaid claims and damages. 2hite )alconIs ass,m-tion of BecmenIs lia+ility does not a,tomatically res,lt in BecmenIs freedom or release from lia+ility. This has +een r,led in &BD ?verseas 5an-ower Cor-oration v. NLRC. 3nstead% +oth Becmen and 2hite )alcon sho,ld +e held lia+le solidarily% witho,t -reC,dice to each having the right to +e reim+,rsed ,nder the -rovision of the Civil Code that whoever -ays for another may demand from the de+tor what he has -aid. GOVERNMENT SERVICE INSURANCE SYSTEM V. SALVADOR A. DE CASTRO G.R. N?. '#$:#% .ULS #% ($$" )&CTS* Res-ondent De Castro rendered service in the /hili--ine &ir )orce ;/&)< from &-ril % "P@ ,ntil his retirement on 5arch (% ($$!. ?n Decem+er ((% ($$@% De Castro was admitted at the 4. L,na General =os-ital% &)/ 5edical Center d,e to chest -ains. =e also ,nderwent coronary angiogram -roced,re which showed that he had signiAcant sim-le vessel coronary artery disease ;C&D<. =e was diagnosed to +e s,Jering from ;< @\0D( 0 Coronary artery disease and ;(< @$$0#:: 0 =y-ertensive cardiovasc,lar disease. De Castro retired from the service on 5arch (% ($$! with a ECertiAcate of Disa+ility Discharge.E ?n this +asis% he Aled a claim for -ermanent total disa+ility +eneAts with the GS3S. 3n a decision dated .,ne ($% ($$!% the GS3S denied De Castro6s claim +ased on the Anding that De Castro6s illnesses were non0occ,-ational. De Castro a--ealed to the Bm-loyees6 Com-ensation Commission ;BCC<. The BCC a9rmed the r,ling of the GS3S and denied the claim des-ite the o+servation that C&D is an occ,-ational disease +eca,se of Ethe -resence of factors which are not wor10related% s,ch as smo1ing and alcohol cons,m-tion.E De Castro so,ght relief from the C& thro,gh a -etition for review ,nder R,le @: of the R,les of Co,rt. The C& granted the -etition. The C& e7-lained that it is not necessary that there +e -roof of ca,sal relation +etween the wor1 and the illness which res,lted in De Castro6s disa+ility. =ence% this -etition. 3SSUBS* ;< 2?N the diseases of the res-ondent are wor1 related and com-ensa+le. RUL3NG* ;< SBS. " F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch The ailments that -reci-itated De Castro6s se-aration from the military service 0 C&D and hy-ertensive cardiovasc,lar disease are occ,-ational diseases. No less than the BCC itself conArmed the stat,s of these ailments when it declared that EContrary to the r,ling of the System% C&D is a form of cardiovasc,lar disease which is incl,ded in the list of ?cc,-ational Diseases.E B,t des-ite the com-ensa+le character of his ailments% +oth the GS3S and the BCC fo,nd De Castro6s C&D to +e non0wor1 related and% therefore% non0com-ensa+le. 3n any determination of com-ensa+ility% the nat,re and characteristics of the Co+ are as im-ortant as raw medical Andings and a claimant6s -ersonal and social history. This is a +asic legal reality in wor1ers6 com-ensation law. 2e are therefore s,r-rised that the BCC and the GS3S sim-ly +r,shed aside the disa+ility certiAcation that the military iss,ed with res-ect to De Castro6s disa+ility% +ased mainly on their -rimacy as the agencies with e7-ertise on wor1ers6 com-ensation and disa+ility iss,es. 2hile BCC and GS3S are admittedly the government entities with C,risdiction over the administration of wor1ers6 disa+ility com-ensation and can th,s claim -rimacy in these areas% they cannot however claim infalli+ility% -artic,larly when they ,se wrong or limited considerations in determining com-ensa+ility. This holds tr,e in this case where neither the GS3S nor the BCC cond,cted a medical e7amination of De Castro on their ownD they merely relied on the res,lts of De Castro6s medical e7amination cond,cted at the 4. L,na General =os-ital% a government military hos-ital. 3t was from these same medical Andings that the GS3S and BCC derived their concl,sion that De Castro6s drin1ing and smo1ing ha+its and -ersonal lifestyle ca,sed his ailments. 3nto7ication which does not inca-acitate the em-loyee from following his occ,-ation is not s,9cient to defeat the recovery of com-ensation% altho,gh into7ication may +e a contri+,tory ca,se to his inC,ry. 2hile smo1ing may contri+,te to the develo-ment of a heart ailment% heart ailment may +e ca,se +y other factors s,ch as wor1ing and living ,nder stressf,l conditions. Th,s% the -erem-tory -res,m-tion that -etitioner6s ha+it of smo1ing heavily was the wilf,ll act which ca,ses his illness and res,lting disa+ility% witho,t more% cannot s,9ce to +ar -etitioner6s claim for disa+ility +eneAts. 2e consider it signiAcant that De Castro entered military service as a At and healthy new soldier. 2e note% too% De Castro6s service record and the medals% awards% and commendations he earned% all attesting to :( years of very active and -rod,ctive service in the military. Th,s% the C&D and the hy-ertension came while he was engaged in these endeavors. To say% as the GS3S and the BCC did% that his ailments are concl,sively non0wor1 related +eca,se he smo1ed and dran1% is to close o,r eyes to the rigors of military service and to the demands of De Castro6s s-eciAc -ositions in the military service% and to single o,t factors that wo,ld deny the res-ondent6s claim. This is far from the +alancing that the GS3S invo1es +etween sym-athy for the wor1ingman and the e8,ally vital interest of denying ,nderserving claims. Th,s% +ased on the totality of the circ,mstances s,rro,nding De Castro6s case% we are convinced that his long years of military service% with its attendant stresses and -ress,res% contri+,ted in no small meas,re to the ailments that led to his disa+ility retirement. 2e% therefore% agree with the C& when it concl,ded that De Castro6s Eillness was contracted d,ring and +y reason of his em-loyment% and any non0wor1 related factor that contri+,ted to its aggravation is immaterial.E 2e close +y reiterating that what the law re8,ires is a reasona+le wor1 connection and not direct ca,sal relation. /ro+a+ility% not the ,ltimate degree of certainty% is the test of -roof in com-ensation -roceedings. )or% in inter-reting and carrying o,t the -rovisions of the La+or Code and its 3m-lementing R,les and Reg,lations% the -rimordial and -aramo,nt consideration is the em-loyee6s welfare. To safeg,ard the wor1er6s rights% any do,+t on the -ro-er inter-retation and a--lication m,st +e resolved in favor of la+or. 2e reiterate these same -rinci-les in the -resent case. &ccordingly% we hold that De Castro6s ailments 0 C&D and hy-ertensive cardiovasc,lar disease 0 are wor10connected ,nder the circ,mstances of the -resent case and are% therefore% com-ensa+le. 2=BRB)?RB% -remises considered% the -etition for review on certiorari Aled +y the Government Service 3ns,rance System ;GS3S< is here+y DBN3BD for lac1 of merit. The challenged decision and resol,tion of the Co,rt of &--eals in C&0G.R. S/ No. $$:P# are here+y &))3R5BD. S? ?RDBRBD. GREAT SOUTHERN MARITIME SERVICES CORP. a*+ IMC SHIPPING CO., PTE. LTD., vs. LEONILA SURIGAO 4,- He-sel4 a*+ I* Be0al4 ,4 He- M3*,- C03l+-e*, Na;el8 KAYE ANGELI a*+ MIRIAM, B,t0 S5-*a;e+ SURIGAO ($ F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch G.R. No. ':!@!% Se-tem+er '% ($$" )&CTS* MRes-ondent Leonila S,rigaoIsN h,s+and% the late Salvador 5. S,rigao% was hired as )itter +y M-etitionerN Great So,thern 5aritime Services Cor-oration% for and in +ehalf of Mco0-etitionerN 35C Shi--ing Co. /te.% Ltd. ;Singa-ore< for a -eriod of ten ;$< months. 3n his -re0em-loyment medical e7amination% he was fo,nd At for sea d,ty. Th,s% on &-ril ("% ($$% he commenced his wor1 a+oard 54 Selendang Nilam. =owever% on &,g,st ((% ($$% as -er Shi- 5asterIs advice% a doctor was sent on +oard the vessel to medically attend to Salvador d,e to com-laints of e7tensive ne,ro dermatitis% nec1 region viral% aetiology% ,rticaria% mac,lo -o-,lar% rash e7tending to the face% chest and a+domen. &fter e7amination% Salvador was advised to ta1e a +lood test. =is condition having worsened% he was conAned at the Seven =ills =os-ital. Not long thereafter% the Shi- 5aster decided to sign him oJ from the vessel on &,g,st (#% ($$ for treatment in the hos-ital and for re-atriation ,-on certiAcation of the doctor that he was At to travel. /rior to his re-atriation% tho,gh% or on &,g,st (!% ($$% at aro,nd seven oIcloc1 in the morning% Salvador was fo,nd dead inside the +athroom of his hos-ital room. Later% his +ody was transferred to a government hos-ital% the Ling George =os-ital 5ort,ary =all% for -ost0mortem e7amination. The /ost05ortem CertiAcate iss,ed +y the De-artment of )orensic 5edicine% 4isa1ha-atnam City% stated that the ca,se of death of Salvador was as-hy7ia d,e to hanging. &s an heir of the deceased seaman% -etitioner% for in +ehalf of her minor children% Aled for death com-ensation +eneAts ,nder the terms of the standard em-loyment contract% +,t her claims were denied +y the M-etitionersN. 3SSUBS* 2=BT=BR ?R N?T /R34&TB RBS/?NDBNT 3S BNT3TLBD T? DB&T= BBNB)3TS )?R T=B DB&T= ?) =BR =USB&ND UNDBR T=B /?B& ST&ND&RD B5/L?S5BNT C?NTR&CT )?R SB&)&RBRS. =BLD* The -ertinent -rovisions of the Standard Terms and Conditions Governing the Bm-loyment of )ili-ino Seafarers ?n0Board ?cean0Going 4essels% or the /?B& Standard Bm-loyment Contract% which Salvador and the -etitioners incor-orated into their contract% -rovide that* SE')+,( 3/! ',&PE(SA)+,( A(" #E(EL+)S A! ',&PE(SA)+,( A(" #E(EL+)S L,R "EA)H =! +n case of death of the seafarer during the term of his contract0 the employer shall pay his ene2ciaries the Philippine 'urrency eEui%alent to the amount of Lifty )housand <S dollars (<SSM/0///) and an additional amount of Se%en )housand <S dollars (<SSH0///) to each child under the age of twenty*one (3=) ut not e8ceeding four (D) children at the e8change rate pre%ailing during the time of payment! 8 8 8 8 "! (o compensation and ene2ts shall e payale in respect of any in$ury0 incapacity0 disaility or death of the seafarer resulting from his willful or criminal act or intentional reach of his duties0 pro%ided howe%er0 that the employer can pro%e that such in$ury0 incapacity0 disaility or death is directly attriutale to the seafarer! The general r,le is that the em-loyer is lia+le to -ay the heirs of the deceased seafarer for death +eneAts once it is esta+lished that he died d,ring the eJectivity of his em-loyment contract. =owever% the em-loyer may +e e7em-ted from lia+ility if he can s,ccessf,lly -rove that the seafarerIs death was ca,sed +y an inC,ry directly attri+,ta+le to his deli+erate or willf,l act. 3n s,m% res-ondentsI entitlement to any death +eneAts de-ends on whether the evidence of the -etitioners s,9ces to -rove that the deceased committed s,icideD the +,rden of -roof rests on his em-loyer. /etitioners insist that res-ondents are not entitled to death +eneAts +eca,se Salvador committed s,icide. &s -roof% they -resented the Death CertiAcate iss,ed +y Dr. B,tchi RaC, stating that Salvador was s,s-ected to have committed s,icideD the -ost0mortem e7amination res,lts stating that the deceased a--eared to have died of E&S/=S\3& DUB T? =&NG3NGED the 3ndian /olice 3n8,est Re-ort also stating that he died d,e to hangingD the a9davit of the n,rse on d,ty of Seven =ills hos-ital% 5s. /. 4. Ramanamma% wherein she stated that as the entrance doors to the +athroom main room was +olted from the inside and no other -erson was in the near -hysical vicinity of the deceased% it was concl,ded that seafarer committed s,icideD as well as -hotos ta1en immediately after the discovery of the +ody with a +elt aro,nd his nec1. They contend that the a--ellate co,rt erred in disregarding these -ieces of evidence which convincingly r,le o,t s,s-icions of fo,l -lay. The -etition is im-ressed with merit. 2e And the foregoing circ,mstances as constit,ting s,+stantial evidence s,--orting a concl,sion that SalvadorIs death was attri+,ta+le to himself* ( F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch . Salvador was last seen alive +y the attending n,rse in Room No. !" at a+o,t @*$$ a.m. of &,g,st (!% ($$D (. &t !*:$ a.m. of the same day% when no one answered to the re-eated 1noc1s of the attending n,rse% the hos-ital staJ forci+ly o-ened the main door of the roomD :. Things inside the room were fo,nd in orderD @. The +athroom door was loc1ed from inside and the hos-ital staJ gained entrance therein only thro,gh a closed door with a mesh leading to the ceiling of the +athroomD #. The window in the +athroom has grillsD !. Salvador was fo,nd dead inside with a +elt tied aro,nd his nec1D P. & +ro1en -i-e and showerhead were fo,nd near the +odyD and '. The -ost0mortem e7amination res,lt stating an o-inion on the ca,se of death as &s-hy7ia d,e to hanging. The -ost0mortem e7amination concl,sively esta+lished that the tr,e ca,se of death was as-hy7ia or s,Jocation. The a--ellate co,rtIs r,ling that while it may +e consistent with the theory that the deceased hanged himself +,t it does not r,le o,t the -ossi+ility that he might have died of other ca,ses% does not -ers,ade. &side from +eing -,rely s-ec,lative% we And it hard to +elieve that someone strangled Salvador inside the +athroom then loc1ed the door thereof on his way o,t ,ndetected. &s shown +y the evidence -resented +y the -etitioners% the +athroom door was loc1ed or +olted from the inside and co,ld not +e o-ened from o,tside. 3n order to gain entrance% the hos-ital staJ had to -ass thro,gh a closed door with a mess leading to the ceiling of the +athroom. Bntry co,ld not li1ewise +e eJected thro,gh the +athroom window as it has grills. 5oreover% the concl,sion that Salvador co,ld not have hanged himself to the showerhead as he was fo,nd lying on the Toor with a +elt tied aro,nd his nec1D or that he co,ld not have died since the -i-e +ro1e down and he fell therefrom% are +ased on s-ec,lations and hy-othetical in nat,re. This conf,sion co,ld have +een avoided had +oth the Co,rt of &--eals and the La+or &r+iter considered the most logical -ossi+ility that Salvador died hanging on the showerhead +efore the -i-e +ro1e down d,e to his +ody weight% and th,s% e7-laining why he was fo,nd on the Toor with the +elt still on his nec1 and +ro1en -i-e and showerhead near his lifeless +ody. That the -ost0mortem e7amination% the CertiAcation of Dr. RaC, and the -olice in8,est re-ort% all stated that SalvadorIs ca,se of death was as-hy7ia d,e to hanging% and not d,e to any other inC,ry% lead to a fair and C,st concl,sion that Salvador was already dead +efore the showerhead +ro1e. 3n 5a+,hay Shi--ing Services% 3nc. v. National La+or Relations Commission% the Co,rt held that the death of a seaman even d,ring the term of em-loyment does not a,tomatically give rise to com-ensation. The circ,mstances which led to the death as well as the -rovisions of the contract% and the right and o+ligation of the em-loyer and the seaman m,st +e ta1en into consideration% in consonance with the d,e -rocess and e8,al -rotection cla,ses of the Constit,tion. 3t is tr,e that the +eneAcent -rovisions of the Standard Bm-loyment Contract are li+erally constr,ed in favor of )ili-ino seafarers and their de-endents. 2e commiserate with res-ondents for the ,nfort,nate fate that +efell their loved oneD however% we And that the fact,al circ,mstances in this case do not C,stify the grant of death +eneAts as -rayed for +y them as +eneAciaries of Salvador. \\\ N?T=3NG )?LL?2S \\\ GODSPEED, BATCH CD?/E (( F / a g e USC L&2. Batch ($:. $$ G H University of San Carlos College of Law LABOR LAW REVIEW CASE DIGESTS The Diamond Batch (: F / a g e USC L&2. Batch ($:. $$ G H