[G.R. No. 161654 May 5, 2006]
DUSIT HOTEL NIKKO, Petitioner, vs. RENATO M. GATBONTON, Respondent.


On November 21, 1998, respondent Renato M. Gatbonton was hired as Chief Steward in
petitioner Dusit Hotel Nikko’s Food and Beverage Department. He signed a three-month
probationary employment contract until February 21, 1999, with a monthly salary of
P25,000. At the start of his employment, the standards by which he would be assessed
to qualify for regular employment were explained to him.

The hotel alleged that at the end of the probation period, Ingo Rauber, Director of its
Food and Beverage Department, observed that Gatbonton failed to meet the
qualification standards for Chief Steward, and Rauber recommended a two-month
extension of Gatbonton’s probationary period, or until April 22, 1999. At the end of the
4th month, on March 24, 1999, Rauber informed Gatbonton that the latter had poor
ratings on staff supervision, productivity, quantity of work, and overall efficiency and did
not qualify as Chief Steward. Gatbonton requested another month or until April 22,
1999 to improve his performance, to which Rauber agreed but allegedly refused to sign
the Performance Evaluation Form. Neither did he sign the Memorandum on the

On March 31, 1999, a notice of termination of probationary employment effective April
9, 1999, on the above alleged grounds was served on Gatbonton. On April 12, 1999, he
filed a complaint for illegal dismissal and non-payment of wages, with prayers for
reinstatement, full backwages, and damages, including attorney’s fees.

Whether or not respondent was a regular employee at the time of his dismissal.


The SC held that as Article 281 clearly states, a probationary employee can be legally
terminated either: (1) for a just cause; or (2) when the employee fails to qualify as a
regular employee in accordance with the reasonable standards made known to him by
the employer at the start of the employment. Nonetheless, the power of the employer
to terminate an employee on probation is not without limitations. First, this power must
be exercised in accordance with the specific requirements of the contract. Second, the
dissatisfaction on the part of the employer must be real and in good faith, not feigned
so as to circumvent the contract or the law; and third, there must be no unlawful
discrimination in the dismissal. In termination cases, the burden of proving just or valid
cause for dismissing an employee rests on the employer.

Here, the petitioner did not present proof that the respondent was evaluated from
November 21, 1998 to February 21, 1999, nor that his probationary employment was
validly extended. The petitioner alleged that at the end of the respondent’s three-month
probationary employment, Rauber recommended that the period be extended for two
months since respondent Gatbonton was not yet ready for regular employment. The
petitioner presented a Personnel Action Form containing the recommendation. We

1999.R. recommending the extension of the respondent’s probation period for two months.” Yet. 148738 June 29. 2004 Petitioner: Mitsubishi Motors Philippines Corporation Respondents: Chrysler Philippines Labor Union and Nelson Paras FACTS: Private respondent Nelson Paras first worked with Mitsubishi Philippines as a shuttle bus driver on March 19. Third. or for any length of time set forth by the employer (in this case. This is clear in the last sentence of Article 281. showing that the respondent’s probationary employment was extended for two months effective February 23. Since respondent was not dismissed for a just or authorized cause. and other privileges as well as to full backwages. Gatbonton had become a regular employee. the end of the 4th month of the respondent’s employment. three months). In fact. 1994 to March 3. Again. that this document was prepared on March 31. 1999. No. Any circumvention of this provision would put to naught the State’s avowed protection for labor. He resigned on June 16. shall be considered a regular employee.observed. Mitsubishi Philippines re-hired him as a welder-fabricator at a tooling shop from November 1. inclusive of allowances. First. Petition is denied. the supposed Memorandum was not presented. however. 1999. contained the following remarks: “subject to undergo extension of probation for two (2) months as per attached memo. 1999. we cannot conclude that respondent failed to meet the standards of performance set by the hotel for a chief steward. 1976. 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. It is an elementary rule in the law on labor relations that a probationary employee engaged to work beyond the probationary period of six months. we find this document inconclusive. the recommended action was termination of probationary employment effective April 9. the action form did not contain the results of the respondent’s evaluation. Mitsubishi Motors vs Chrysler Philippines Labor Union G. In the absence of any evaluation or valid extension. the petitioner presented another Personnel Action Form prepared on March 2. . 1982 because he went to Saudi Arabia and worked there as a diesel mechanic and heavy machine operator from 1982 to 1993. the action form spoke of an attached memo which the petitioner identified as Rauber’s Memorandum. the action form did not bear the respondent’s signature. as provided under Article 281 of the Labor Code. Upon his return. Second. 1999. Upon appeal to the NLRC. Without the evaluation. his dismissal was illegal. 1995. At the expiration of the three-month period. and not extension of probation period. the action form had no basis. The Personnel Action Form dated March 2. and he is entitled to reinstatement without loss of seniority rights.

Paras was re-hired again. He had an orientation on May 15. with respect to the company’s rules and guidelines.T.On May 1996. Velando. Applying Article 13 of the Civil Code. ISSUE: Whether or not respondent Paras’ termination was legal or not. This letter’s intent is to formally relieve him off of his services and position effective the date since he failed to meet the company’s standards. 1996. As per the company's policy. Paras received a Notice of Termination on November 26. Lopez. 1996. The supervisors rating Paras’ performance were Lito R. The Court conforms with paragraph one. 1996 and afterwhich. started reporting for work on May 27. Victoria and Dante Ong reviewed the performance evaluation made on Paras. The Court stresses the existence of the statements under Article 281 of the Labor Code which specifies that the employer must inform the employee of the standards they were to meet in order to be granted regularization and that such probationary period shall not exceed six (6) months from the date the employee started working. they unanimously agreed that the performance was unsatisfactory. HELD: The Court holds that a company employer may indeed hire an employee on a probationary basis in order to determine his fitness to perform work. But as part of the company protocols. respondent Paras was informed by his supervisor. 1996. the probationary period of six (6) months consists of one hundred eighty (180) days. Article 13 of the Civil Code providing that the months which are not designated by their names shall be understood as consisting of thirty (30) days each. H. unless specified in the apprenticeship agreement. this time as a probationary manufacturing trainee at the Plant Engineering Maintenance Department. Paras was evaluated by his immediate supervisors after six months of working. His first day to report for work was on May 27. as part of the MMPC’s company policies. Paras was not considered for regularization. This case. Lacambacal. that he received an average performance rating but it is a rate which would still qualify him to be regularized. the Division Managers namely A. Later. Respondent Paras was employed on a probationary basis and was apprised of the standards upon which his regularization would be based during the orientation. Upon this evaluation. 1996 which was dated November 25. . Lacambacal and Wilfredo J. Despite the recommendations of the supervisors.C. As a consequence. the probationary period was from three (3) months to a maximum of six (6) months. Paras garnered an average rating.

and ended on November 23. 1996. it is said that in computing a period. Also. he was actually already a regular employee of the petitioner under Article 281 of the Labor Code. 1996. of November 26. His position as a regularized employee is thus secured until further notice. 1996. the first day shall be excluded and the last day included. The Court held that by that time.m.the Labor Code pertains to 180 days. the one hundred eighty (180) days commenced on May 27. The termination letter dated November 25. as clearly provided for in the last paragraph of Article 13. 1996 was served on respondent Paras only at 3:00 a. . Thus.