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Condo Suite Club Travel, Inc. vs.

Facts: Petitioner Florencio Lalo was employed as a housekeeper at the Sunette Realty Development
Corporation with a monthly salary of P8,000.00. After his employment with SRD, he signed a new
employment contract with Condo Suite Club under the same terms of employment. Both companies are
owned by the Arcon Group of Companies. Subsequently, petitioner’s salary was reduced to P6,000.00
because of financial distress and to placate him, it was increased to P6,500.00. He was receiving this
amount until the termination of his services. Beside this day job, petitioner owned a rent-a-car service
with Landrigan as his driver. One incident cost his employment, when Landrigan went to the hotel
petitioner was working at and demanded payment of car rental services to one of its guests. The front
desk clerk charged the said expense to the account of the guest with his permission. The guest found
out the discrepancy and reported the overbilling. Petitioner was then terminated by the hotel and
forced him to file a complaint for illegal dismissal. The Labor Arbiter dismissed the complaint for lack of
merit. The NLRC however, found out that there was illegal dismissal because it was never proved by
substantial evidence that petitioner was guilty of loss of trust and confidence due to the said incident.
The hotel failed to establish that petitioner was part of the overbilling incident and was only made a
party because he owned the rental car services.
Issue: WON petitioner was guilty of loss of trust and confidence.
Ruling: No. Termination of an employment on this ground does not require proof beyond reasonable
doubt of the employee’s misconduct. It is sufficient that there is some basis for the loss of trust or that
the employer has reasonable ground to believe that the employee is responsible for the misconduct
which renders him unworthy of the trust and confidence demanded by his position. The Court, however,
has repeatedly stressed that the right of an employer to dismiss employees on account of loss of trust
and confidence must not be exercised arbitrarily. Just cause must be shown, so as not to render the
employee’s constitutional right to security of tenure nugatory. Besides, for loss of confidence to be a
valid ground for dismissal, the basis thereof must arise from particular proven facts. In other words, this
ground must be founded on facts established by the employer who must clearly and convincingly prove
by substantial evidence the facts and incidents upon which loss of confidence in the employee may be
fairly made to rest; otherwise the dismissal will be rendered illegal. In the instant case, the hotel failed
to prove by ample evidence that Florencio Lalo intended to defraud Mr. Hu (the guest), as herein
explained. Hence, there is no basis for petitioner to claim it lost the trust and confidence it had reposed
upon private respondent. In sum, there is no valid and just cause in terminating the employment of
Florencio Lalo. With the finding that Florencio Lalo was illegally dismissed, he is entitled to
reinstatement without loss of seniority rights and other privileges and to his full backwages inclusive of
allowances, and to other benefits or their monetary equivalent computed from the time his
compensation was withheld from him up to the time of his actual reinstatement.