LABOR RELATIONS
SECURITY OF TENURE
(July 22, 2017 coverage)
__________________________________________________
29. JENNY AGABON, ET AL VS NLRC
Facts: Riviera Home Improvements, Inc. is
engaged in the business of selling and
installing ornamental and construction
materials. It employed Virgilio Agabon and
Jenny Agabon as gypsum board and cornice
installers on January 2, 1992 until February
23, 1999 when they were dismissed for
abandonment of work. The Agabons filed a
complaint for illegal dismissal before the LA,
who ruled in their favor. The NLRC reversed
on appeal. The CA sustained the NLRCs
decision. The Agabons further appealed to the
SC, disputing the finding of abandonment, and
claiming that the company did not comply
with the twin requirements of notice and
hearing.
Issue: WON the Agabons were illegally
dismissed?
Ruling: No. The dismissal should be upheld
because it was established that the Agabons
abandoned their jobs to work for another
company. Riviera Home, however, did not
follow the notice requirements and instead
argued that sending notices to the last known
addresses would have been useless because
they did not reside there anymore.
Unfortunately, this is not a valid excuse
because the law mandates the twin notice
requirements to the employees last known
address. Thus, it should be held liable for non-
compliance with the procedural requirements
of due process.
When the dismissal is for a just cause,
the lack of statutory due process should not
nullify the dismissal, or render it illegal, or
ineffectual. However, the employer should
indemnify the employee for the violation of
his statutory rights.
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30. JAKA FOOD PROCESSING
CORPORATION, vs. DARWIN PACOT
Facts: Respondents were earlier hired by
petitioner JAKA Foods Processing
Corporation until the latter terminated their
employment because the corporation was in
dire financial straits. It is not disputed,
however, that the termination was effected
without JAKA complying with the
requirement under Article 283 of the Labor
Code regarding the service of a written notice
upon the employees and the Department of
Labor and Employment at least one (1)
month before the intended date of
termination. Respondents filed complaints for
illegal dismissal, underpayment of wages and
nonpayment of service incentive leave and
13th month pay against JAKA. The Labor
Arbiter rendered a decision declaring the
termination illegal and ordering JAKA to
reinstate respondents with full backwages,
and separation pay if reinstatement is not
possible. The Court of Appeals reversed said
decision and ordered respondent JAKA to pay
petitioners separation pay equivalent to one
(1) month salary, the proportionate 13th
month pay and, in addition, full backwages
from the time their employment was
terminated.
Issue: What are the legal implications of a
situation where an employee is dismissed for
cause but such dismissal was effected without
the employers compliance with the notice
requirement under the Labor Code?
Ruling: It was established that there was
ground for respondents dismissal, i.e.,
retrenchment, which is one of the authorized
causes enumerated under Article 283 of the
Labor Code. Likewise, it is established that
JAKA failed to comply with the notice
requirement under the same Article.
Considering the factual circumstances in the
instant case, the Court deem it proper to fix
the indemnity at P50, 000.00. The Court of
Appeals have been in error when it ordered
JAKA to pay respondents separation pay
equivalent to one (1) month salary for every
year of service. In all cases of business
closure or cessation of operation or
undertaking of the employer, the affected
employee is entitled to separation pay. This is
consistent with the state policy of treating
labor as a primary social economic force,
affording full protection to its rights as well as
its welfare. The exception is when the closure
of business or cessation of operations is due
to serious business losses or financial
reverses; duly proved, in which case, the right
of affected employees to separation pay is lost
for obvious reasons.
31. ABBOTT VS. ALCARAZ
Facts: On June 27, 2004, Abbott Laboratories,
Philippines (Abbott) caused the publication in
a major broadsheet newspaper of its need for
a Medical and Regulatory Affairs Manager.
Alcaraz showed interest and submitted her
application on October 4, 2004. On December
7, 2004, Abbott formally offered Alcaraz the
above-mentioned position which was an item
under the companys Hospira Affiliate Local
Surveillance Unit (ALSU) department. In
Abbotts offer sheet, it was stated that Alcaraz
was to be employed on a probationary basis.
Later that day, she accepted the said offer and
received an electronic mail (e-mail) from
Abbotts Recruitment Officer, Teresita C.
Bernardo (Bernardo), confirming the same.
Attached to Bernardos e-mail were Abbotts
organizational chart and a job description of
Alcarazs work. On February 12, 2005,
Alcaraz signed an employment contract
which stated that she was to be placed on
probation for a period of six (6) months
beginning February 15, 2005 to August 14,
2005. On March 3, 2005, Maria Olivia T.
Yabut-Misa, Abbotts Human Resources (HR)
Director, sent Alcaraz an e-mail which
contained an explanation of the procedure for
evaluating the performance of probationary
employees and further indicated that Abbott
had only one evaluation system for all of its
employees. Alcaraz was also given copies of
Abbotts Code of Conduct and Probationary
Performance Standards and Evaluation
(PPSE) and Performance Excellence
Orientation Modules (Performance Modules)
which she had to apply in line with her task of
evaluating the Hospira ALSU staff. On May 23,
2005, Walsh, Almazar, and Bernardo
personally handed to Alcaraz a letter stating
that her services had been terminated
effective May 19, 2005. Alcaraz felt that she
was unjustly terminated from her
employment and thus, filed a complaint for
illegal dismissal and damages against Abbott
and its officers, namely, Misa, Bernardo,
Almazar, Walsh, Terrible, and Feist. She
claimed that she should have already been
considered as a regular and not a
probationary employee given Abbotts failure
to inform her of the reasonable standards for
her regularization upon her engagement as
required under Article 295 of the Labor Code.
In this relation, she contended that while her
employment contract stated that she was to
be engaged on a probationary status, the
same did not indicate the standards on which
her regularization would be based.
Issue: WON Alcaraz was validly terminated
from her employment
Ruling: NO. Abbott failed to follow the above-
stated procedure in evaluating Alcaraz. For
one, there lies a hiatus of evidence that a
signed copy of Alcarazs PPSE form was
submitted to the HRD. It was not even shown
that a PPSE form was completed to formally
assess her performance. Neither was the
performance evaluation discussed with her
during the third and fifth months of her
employment. Nor did Abbott come up with
the necessary Performance Improvement
Plan to properly gauge Alcarazs performance
with the set company standards. The Court
modified Agabon v. NLRC in the case of Jaka
Food Processing Corporation v. Pacot where it
created a distinction between procedurally
defective dismissals due to a just cause, on
one hand, and those due to an authorized
cause, on the other. If the dismissal is based
on a just cause under Article 296 of the Labor
Code but the employer failed to comply with
the notice requirement, the sanction to be
imposed upon him should be tempered
because the dismissal process was, in effect,
initiated by an act imputable to the employee
If the dismissal is based on an authorized
cause under Article 297 but the employer
failed to comply with the notice requirement,
the sanction should be stiffer because the
dismissal process was initiated by the
employers exercise of his management
prerogative.
Alcarazs dismissal proceeded from her
failure to comply with the standards required
for her regularization. As such, it is
undeniable that the dismissal process was, in
effect, initiated by an act imputable to the
employee, akin to dismissals due to just
causes under Article 296 of the Labor Code.
_______________________________________________
65. ANTONIO E. UNICA vs. ANSCOR SWIRE
SHIP MANAGEMENT CORPORATION
Duron
FACTS: Since the late 1980s, petitioner
Antonio Unica was employed by respondent
Anscor Swire Management Corp (a manning
agency) under various contracts. In his last
contract, petitioner was deployed for a period
of 9 months, from January 29, 2000 to
October 25, 2000. Since the vessel was at sea,
petitioner was only repatriated on November
14, 2000, or 20 days after the expiration of
his contract of employment.
Petitioner claims that since he was allowed to
stay in the vessel for another 20 days, there
was an implied renewal of his employment
contract. Hence, when he was repatriated on
November 14, 2000 without a valid cause, he
was illegally dismissed. Petitioner filed a case
against the respondent for illegal dismissal,
payment of retirement, disability and
medical benefits, separation and holiday pay.
Respondent, in its defense, argues that
petitioner was hired for a fixed period, the
duration of which depends upon the mutual
agreement of the parties. Petitioners
employment was, therefore, co-terminus with
the term of his contract. Hence when he was
repatriated, the term of his contract was
completed.
LA ruled in petitioner's favor. It held that
since petitioner was not repatriated at the
expiration of his contract on October 25 and
was allowed to continue working on board
respondent's vessel until November 14, his
contract with respondent was impliedly
renewed for another 9 months.
NRLC affirmed LA's decision with
modification. NLRC ruled that the contract
did not expire on October 25, 2000, but was
impliedly extended for another nine months.
This is because it was only on November 14,
2000 when petitioner was told by respondent
to disembark because he would be
repatriated. Since there was an implied
extension of the contract for another nine
months, petitioner is, therefore, entitled to
payment of the unexpired term of his implied
contract.
CA set aside the decision of the NLRC. The CA
ruled that there was no implied renewal of
contract and the 20 days extension was due
to the fact that the ship was still at sea.
ISSUE: WON there was an implied renewal of
Petitioner's contract of employment with
respondent
RULING: No implied renewal.
Petitioner's late disembarkation was not
without valid reason (note: employment
contract ended on Oct. 25 2000, disembarked
on November 14 2000). Respondent could
not have disembarked petitioner on the date
of the termination of his employment
contract as the vessel was still in the middle
of the sea. Clearly, it was impossible for
petitioner to safely disembark immediately
upon the expiration of his contract, since he
must disembark at a convenient port. Thus,
petitioner's stay in the vessel for another 20
days should not be interpreted as an implied
extension of his contract. A seaman need not
physically disembark from a vessel at the
expiration of his employment contract to
have such contract considered terminated.
As a rule, seafarers are considered
contractual employees. Their employment is
governed by the contracts they sign
everytime they are rehired and their
employment is terminated when the contract
expires. Their employment is contractually
fixed for a certain period of time.
Thus, when petitioner's contract ended on
October 25, 2000, his employment is deemed
automatically terminated, there being no
mutually-agreed renewal or extension of the
expired contract. However, petitioner is
entitled to be paid his wages after the
expiration of his contract until the vessel's
arrival at a convenient port. Section 19 of the
Standard Terms and Conditions Governing
the Employment of Filipino Seafarers On-
Board Ocean-Going Vessels is clear on this
point:
REPATRIATION. A. If the
vessel is outside the
Philippines upon the
expiration of the contract,
the seafarer shall continue
his service on board until the
vessel's arrival at a
convenient port and/or after
arrival of the replacement
crew, provided that, in any
case, the continuance of such
service shall not exceed
three months. The seafarer
shall be entitled to earned
wages and benefits as
provided in his contract.
CA affirmed. Petition denied. Respondent
is DIRECTED to PAY petitioner his salary
from October 26, 2000 until November 14,
2000.
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66. IMASEN PHILIPPINE MANUFACTURING
CORPORATION v. ALCON
Facts: Imasen is a domestic corporation
engaged in the manufacture of auto seat-
recliners and slide-adjusters. It hired the
respondents as manual welders in 2001.
On October 5, 2002, the respondents
reported for work on the second shift - from
8:00 pm to 5:00 am of the following day. At
around 12:40 am, Cyrus A. Altiche, Imasen's
security guard on duty, went to patrol and
inspect the production plant's premises.
When Altiche reached Imasen's Press Area, he
heard the sound of a running industrial fan.
Intending to turn the fan off, he followed the
sound that led him to the plant's "Tool and
Die" section. At the "Tool and Die" section,
Altiche saw the respondents having sexual
intercourse on the floor, using a piece of
carton as mattress. Altiche immediately went
back to the guard house and relayed what he
saw to Ogana, another security guard on
duty. Ogana made a follow-up inspection.
Ogana went to the "Tool and Die" section and
saw several employees, including the
respondents, already leaving the area. He
noticed, however, that Alcon picked up the
carton that Altiche claimed the respondents
used as mattress during their sexual act, and
returned it to the place where the cartons
were kept. Altiche then submitted a
handwritten report of the incident to
Imasen's Finance and Administration
Manager.
On October 14, 2002, Imasen issued the
respondents separate interoffice
memoranda informing them of Altiche's
report on the October 5, 2002 incident and
directing them to submit their individual
explanation. The respondents complied with
the directive; they claimed that they were
merely sleeping in the "Tool and Die" section
at the time of the incident. They also claimed
that other employees were near the area,
making the commission of the act charged
impossible.
On October 22, 2002, Imasen issued the
respondents another interoffice
memorandum directing them to appear at the
formal hearing of the administrative charge
against them. The hearing was conducted on
October 30, 2002, presided by a mediator and
attended by the representatives of Imasen,
the respondents, Altiche and Ogana. Altiche
and Ogana reiterated the narrations in
Altiche's handwritten report.
On December 4, 2002, Imasen issued the
respondents separate interoffice
memoranda terminating their services. It
found the respondents guilty of the act
charged which it considered as "gross
misconduct contrary to the existing policies,
rules and regulations of the company."
ISSUE: WON the act of engaging in sexual
intercourse inside company premises during
work hours is serious misconduct?
HELD: Yes. Misconduct is defined as an
improper or wrong conduct. It is a
transgression of some established and
definite rule of action, a forbidden act, a
dereliction of duty, willful in character, and
implies wrongful intent and not mere error in
judgment. For misconduct or improper
behavior to be a just cause for dismissal, the
following elements must concur: (a) the
misconduct must be serious; (b) it must
relate to the performance of the employee's
duties showing that the employee has become
unfit to continue working for the employer;
and (c) it must have been performed with
wrongful intent.
Sexual acts and intimacies between two
consenting adults belong, as a principled
ideal, to the realm of purely private relations.
Whether aroused by lust or inflamed by
sincere affection, sexual acts should be
carried out at such place, time and
circumstance that, by the generally accepted
norms of conduct, will not offend public
decency nor disturb the generally held or
accepted social morals. Under these
parameters, sexual acts between two
consenting adults do not have a place in the
work environment.
Indisputably, the respondents engaged in
sexual intercourse inside company
premises and during work hours. These
circumstances, by themselves, are already
punishable misconduct. Added to these
considerations, however, is the implication
that the respondents did not only disregard
company rules but flaunted their disregard in
a manner that could reflect adversely on the
status of ethics and morality in the company.
Additionally, the respondents engaged in
sexual intercourse in an area where co-
employees or other company personnel have
ready and available access. The respondents
likewise committed their act at a time when
the employees were expected to be and had,
in fact, been at their respective posts, and
when they themselves were supposed to be,
as all other employees had in fact been,
working.
Under these factual premises and in the
context of legal parameters we discussed, we
cannot help but consider the respondents'
misconduct to be of grave and aggravated
character so that the company was justified in
imposing the highest penalty available
dismissal. Their infraction transgressed the
bounds of socially and morally accepted
human public behavior, and at the same time
showed brazen disregard for the respect that
their employer expected of them as
employees. By their misconduct, the
respondents, in effect, issued an open
invitation for others to commit the same
infraction, with like disregard for their
employer's rules, for the respect owed to
their employer, and for their co-employees'
sensitivities. Taken together, these
considerations reveal a depraved disposition
that the Court cannot but consider as a valid
cause for dismissal.
__________________________________________________
67. CHERYLL SANTOS LEUS VS, ST.
SCHOLASTICAS COLLEGE, G.R. NO. 187226,
JANUARY 28, 2015
Facts: Cheryll was a non-teaching personnel
at St. Scholaticas College, a Catholic School.
They adapt the teaching of the Roman
Catholic faith. Cheryll became pregnant out of
wedlock with her boyfriend. The school
dismissed her since under the 1992 Manual
for Regulation of Public Schools (1992 MRPS),
one of the grounds for dismissal is
disgraceful or immoral conduct.
Issue: May an employer dismiss an employee
on the ground that the latter got pregnant out
of wedlock? (What if the employer is a strict
Catholic school that imposes strict religious
regulations, will this alone validate the
dismissal made to the erring employee?)
Ruling: No. Her pregnancy out of wedlock
does not constitute a valid ground to
terminate her employment.
Disgraceful conduct is viewed in two ways,
the public and secular view and religious
view. Our laws concern the first view. The
jurisdiction of the court is limited to the first
view. Disgraceful conduct per se will not
amount to violation of the law the conduct
must affect or poses a danger to the
conditions of society, for example, the
sanctity of marriage, right to privacy and the
like. If the Court will entertain the second
view then it would limit religious freedom.
The Court cited Estrada vs. Escritur in the
said case, stating the following relevant
explanation;
(1) if the father of the child is himself
unmarried, the woman is not ordinarily
administratively liable for disgraceful and
immoral conduct. It may be a not-so-ideal
situation and may cause complications for
both mother and child but it does not give
cause for administrative sanction. There is no
law which penalizes an unmarried mother
under those circumstances by reason of her
sexual conduct or proscribes the consensual
sexual activity between two unmarried
persons. Neither does the situation
contravene any fundamental state policy as
expressed in the Constitution, a document
that accommodates various belief systems
irrespective of dogmatic origins.
(2) if the father of the child born out of
wedlock is himself married to a woman other
than the mother, then there is a cause for
administrative sanction against either the
father or the mother. In such a case, the
disgraceful and immoral conduct consists of
having extramarital relations with a married
person. The sanctity of marriage is
constitutionally recognized and likewise
affirmed by our statutes as a special contract of termination on March 10, 2006.
of permanent union. Accordingly, judicial
employees have been sanctioned for their
dalliances with married persons or for their
own betrayals of the marital vow of fidelity.
In this case, it was not disputed that, like
respondent, the father of her child was
unmarried. Therefore, respondent cannot be
held liable for disgraceful and immoral
conduct simply because she gave birth to the
child Christian Jeon out of wedlock.
___________________________________________________
68. DEOFERIO VS. INTEL TECH
PHILIPPINES (R-U, Glenna)
Facts:
Intel Technology Philippines, Inc. employed
Deoferio as a product quality and reliability
engineer. Intel assigned him to the United
States as a validation engineer for an agreed
period of two years. However, Deoferio was
repatriated to the Philippines after being
confined at Providence St. Vincent Medical
Center for major depression with psychosis.
In the Philippines, he worked as a product
engineer.
Deoferio underwent a series of medical and
psychiatric treatment at Intels expense after
his confinement in the United States. He was
diagnosed by several physicians that
suffering from mood disorder, major
depression and auditory hallucination. After
several consultations, Dr. Lee issued a
psychiatric report concluding and stating that
Deoferios psychotic symptoms are not
curable within a period of six months and
will negatively affect his work and social
relation with his co-workers. Pursuant to
these findings, Intel issued Deoferio a notice
Deoferio responded to his termination of
employment by filing a complaint for illegal
dismissal with prayer for money claims
against respondents Intel and Mike Wentling
(respondents). He denied that he ever had
mental illness and insisted that he
satisfactorily performed his duties as product
engineer. He argued that Intel violated his
statutory right to procedural due process
when it summarily issued a notice of
termination.
In defense, the respondents argued that
Deoferios dismissal was based on Dr. Lees
certification that: (1) His schizophrenia was
not curable within a period of six months
even with proper medical treatment; and (2)
His continued employment would be
prejudicial to his and to the other employees
health. The respondents also insisted that
Deoferios presence at Intels premises would
pose an actual harm to his co-employees as
shown by his previous acts. On May 8, 2003,
Deoferio emailed an Intel employee with this
message: All souls day back to work Monday
WW45.1 On January 18, 2005, he cut the
mouse cables, stepped on the keyboards, and
disarranged the desks of his co-employees.
The respondents also highlighted that
Deoferio incurred numerous absences from
work due to his mental condition, specifically,
from January 31, 2002 until February 28,
2002, from August 2002 until September
2002, and from May 2003 until July 2003.
Deoferio also took an administrative leave
with pay from January 2005 until December
2005.
The respondents further asserted that the
twin-notice requirement in dismissals does
not apply to terminations under Article 284
of the Labor Code. They emphasized that the
Labor Codes implementing rules (IRR) only
requires a competent public health
authoritys certification to effectively
terminate the services of an employee.
Issues:
1. Whether Deoferio was suffering from
schizophrenia and whether his
continued employment was
prejudicial to his health, as well as to
the health of his co-employees;
2. Whether the twin notice requirement
in dismissals applies to terminations
due to disease; and
3. Whether Deoferio is entitled to salary
differential, backwages, separation
pay, moral and exemplary damages,
as well as attorneys fees.
Ruling:
Labor Arbiter ruled that Deoferio had been
validly dimissed.
NLRC affirmed LAs ruling.
CA affirmed NLRCs decision.
1. Yes. The third element substantiates the
contention that the employee has indeed
been suffering from a disease that: (1) is
prejudicial to his health as well as to the
health of his co-employees; and (2) cannot be
cured within a period of six months even with
proper medical treatment. Without the
medical certificate, there can be no
authorized cause for the employees
dismissal. The absence of this element thus
renders the dismissal void and illegal.
The present case involves termination due to
disease an authorized cause for dismissal
under Article 284 of the Labor Code. As
substantive requirements, the Labor Code
and its IRR33 require the presence of the
following elements:
(1) An employer has been found to be
suffering from any disease.
(2) His continued employment is
prohibited by law or prejudicial to his
health, as well as to the health of his
co-employees.
(3) A competent public health
authority certifies that the disease is
of such nature or at such a stage that
it cannot be cured within a period of
six months even with proper medical
treatment. With respect to the first
and second elements, the Court
liberally construed the phrase
"prejudicial to his health as well as to
the health of his co-employees" to
mean "prejudicial to his health or to
the health of his co-employees." We
did not limit the scope of this phrase
to contagious diseases for the reason
that this phrase is preceded by the
phrase "any disease" under Article
284 of the Labor Code, to wit:
Art. 284. Disease as ground for
termination. An employer may
terminate the services of an employee
who has been found to be suffering
from any disease and whose
continued employment is prohibited
by law or is prejudicial to his health as
well as to the health of his co-
employees: Provided, That he is paid
separation pay equivalent to at least
one (1) month salary or to one-half
(1/2) month salary for every year of
service, whichever is greater, a
 fraction of at least six (6) months
being considered as one (1) whole
year.
2. Yes. Section 2, Rule 1, Book VI of the IRR
expressly states that the employee should be
afforded procedural due process in all cases
of dismissals.
3. Yes. Intels violation of Deoferios right to
statutory procedural due process warrants
the payment of indemnity in the form of
nominal damages. In Jaka Food Processing
Corp. v. Pacot,41 we distinguished between
terminations based on Article 282 of the
Labor Code42 and dismissals under Article
283 of the Labor Code.43 We then pegged the
nominal damages at P30,000.00 if the
dismissal is based on a just cause but the
employer failed to comply with the twin-
notice requirement. On the other hand, we
fixed the nominal damages at P50,000.00 if
the dismissal is due to an authorized cause
under Article 283 of the Labor Code but the
employer failed to comply with the notice
requirement. The reason is that dismissals for
just cause imply that the employee has
committed a violation against the employer,
while terminations under Article 283 of the
Labor Code are initiated by the employer in
the exercise of his management prerogative.
With respect to Article 284 of the Labor Code,
terminations due to disease do not entail any
wrongdoing on the part of the employee. It
also does not purely involve the employers
willful and voluntary exercise of management
prerogative a function associated with the
employer's inherent right to control and
effectively manage its enterprise.44 Rather,
terminations due to disease are occasioned
by matters generally beyond the worker and
the employer's control.
In fixing the amount of nominal damages
whose determination is addressed to our
sound discretion, the Court should take into
account several factors surrounding the case,
such as: (1) the employers financial, medical,
and/or moral assistance to the sick employee;
(2) the flexibility and leeway that the
employer allowed the sick employee in
performing his duties while attending to his
medical needs; (3) the employers grant of
other termination benefits in favor of the
employee; and (4) whether there was a bona
fide attempt on the part of the employer to
comply with the twin-notice requirement as
opposed to giving no notice at all.
___________________________________________________
69. EMIRITUS SECURITY (2014)
Facts: In August 2000, petitioner hired
respondent as one of its security guards.
During his employment, respondent was
assigned to petitioner's various clients. On 10
December 2005, respondent was relieved
from his post.On 27 January 2006,
respondent filed a complaint for
underpayment of wages, non-payment of
legal and special holiday pay, premium pay
for rest day and underpayment of ECOLA
before the Department of Labor and
Employment, National Capital Region. The
hearing officer recommended the dismissal of
the complaint since the claims were already
paid.
On 16 June 2006, respondent filed a
complaint for illegal dismissal and payment of
separation pay against petitioner before the
Conciliation and Mediation Center of the
NLRC. On 14 July 2006, respondent filed
another complaint for illegal dismissal,
underpayment of salaries and non-payment
of full backwages before the NLRC.
Respondent claimed that on various dates in
December 2005 and from January to May
2006,4 he went to petitioners office to follow-
up his next assignment. After more than six
months since his last assignment, still
respondent was not given a new assignment.
Respondent argued that if an employee is on
floating status for more than six months, such
employee is deemed illegally dismissed.
Petitioner denied dismissing respondent.
Petitioner admitted that it relieved
respondent from his last assignment and
petitioner required respondent to report to
the head office within 48 hours from receipt
of the order of relief. Respondent allegedly
failed to comply. Petitioner also claimed that
there was no showing that respondent was
prevented from returning to his work..
Issue: W/N respondent was illegally
dismissed?
Ruling: Yes. Petitioner admits relieving
respondent from his post as security guard on
10 December 2005. There is also no dispute
that respondent remained on floating status
at the time he filed his complaint for illegal
dismissal on 16 June 2006. In other words,
respondent was on floating status from 10
December 2005 to 16 June 2006 or more than
six months. Petitioners allegation of sending
respondent a notice sometime in January
2006, requiring him to report for work, is
unsubstantiated, and thus, self-serving.
The Court agrees with the ruling of the Labor
Arbiter, NLRC and Court of Appeals that a
floating status of a security guard, such as
respondent, for more than six months
constitutes constructive dismissal. In
Nationwide Security and Allied Services, Inc.
v. Valderama,8 the Court held:
x x x the temporary inactivity or "floating
status" of security guards should continue
only for six months. Otherwise, the security
agency concerned could be liable for
constructive dismissal. The failure of
petitioner to give respondent a work
assignment beyond the reasonable six-month
period makes it liable for constructive
dismissal.
Issue: W/N he is entitled to separation pay?
Ruling: Article 279 of the Labor Code of the
Philippines mandates the reinstatement of an
illegally dismissed employee, to wit:
Security of Tenure. - x x x An employee who is
unjustly dismissed from work shall be
entitled to reinstatement without loss of
seniority rights and other privileges and to
his full back wages, inclusive of allowances,
and to his other benefits or their monetary
equivalent computed from the time his
compensation was withheld from him up to
the time of his actual reinstatement.
Thus, reinstatement is the general rule, while
the award of separation pay is the exception.
In this case, petitioner claims that it complied
with the reinstatement order of the Labor
Arbiter.1wphi1 On 23 January 2008,
petitioner sent respondent a notice informing
him of the Labor Arbiters decision to
reinstate him. Accordingly, in February 2008,
respondent was assigned by petitioner to
Canlubang Sugar Estate, Inc. in Canlubang,
Laguna, and to various posts thereafter. At
the time of the filing of the petition,
respondent was assigned by petitioner to MD
Distripark Manila, Inc. in Bian, Laguna.
Respondent admits receiving a reinstatement
notice from petitioner. Thereafter,
respondent was assigned to one of
petitioner's clients. However, respondent
points out that he was not reinstated by
petitioner Emeritus Security and
Maintenance Systems, Inc. but was employed
by another company, Emme Security and
Maintenance Systems, Inc. (Emme). Thus,
according to respondent, he was not
reinstated at all.
Petitioner counters that Emeritus and Emme
are sister companies with the same Board of
Directors and officers, arguing that Emeritus
and Emme are in effect one and the same
corporation.
Considering petitioner's undisputed claim
that Emeritus and Emme are one and the
same, there is no basis in respondent's
allegation that he was not reinstated to his
previous employment. Besides, respondent
assails the corporate personalities of
Emeritus and Emme only in his Comment
filed before this Court. Further, respondent
did not appeal the Labor Arbiter's
reinstatement order.
Contrary to the Court of Appeals' ruling, there
is nothing in the records showing any
strained relations between the parties to
warrant the award of separation pay. There is
neither allegation nor proof that such
animosity existed between petitioner and
respondent. In fact, petitioner complied with
the Labor Arbiter's reinstatement order.
Considering that (1) petitioner reinstated
respondent in compliance with the Labor
Arbiter's decision, and (2) there is no ground,
particularly strained relations between the
parties, to justify the grant of separation pay,
the Court of Appeals erred in ordering the
payment thereof, in lieu of reinstatement.
___________________________________________________
70. WENPHIL CORPORATION,
vs.
ALMER R. ABING and ANABELLE M.
TUAZON,
Facts: Labor Arbiter Geobel A. Bartolabac
ruled that the respondents had been illegally
dismissed by Wenphil. According to him, the
allegation of serious misconduct against the
respondents had no factual and legal
basis. Consequently, he ordered Wenphil to
immediately reinstate the respondents to
their respective positions or to equivalent
ones. Also, he ordered Wenphil to pay the
respondents their backwages from February
3, 2000 until the date of their actual
reinstatement
Because of the unfavorable LA decision,
Wenphil appealed to the NLRC. In the
meantime, the respondents moved for the
immediate execution of the LAs decision.
On October 29, 2001, Wenphil and the
respondents entered into a compromise
agreement before LA Bartolabac. They agreed
to the respondents payroll reinstatement
while Wenphils appeal with the NLRC was
ongoing. Wenphil also agreed to pay the
accumulated salaries of the respondents for
the payroll.
The NLRC issued a resolution affirming LA
Bartolabacs decision with modifications.
Instead of ordering the respondents
reinstatement, the NLRC directed Wenphil to
pay the respondents their respective
separation pay. Also, the NLRC found that
while the respondents had been illegally
dismissed, they had not been illegally
suspended. Thus, the period from February 3
to February 28, 2000 during which the
respondents were on preventive suspension
was excluded by the NLRC in the computation
of the respondents backwages.
CA reversed the NLRCs finding that the
respondents had been illegally dismissed.
According to the CA, there was enough
evidence to show that the respondents had
been guilty of serious misconduct; thus, their
dismissal was for a valid cause. Also, the CA
ruled that the NLRC committed grave abuse
of discretion when it affirmed the LAs
computed period which was from February
15, 2002 to November 8, 2002. In arriving at
this conclusion, the CA cited the case of Pfizer
v. Velasco where this Court ruled that even if
the order of reinstatement of the Labor
Arbiter is reversed on appeal, it is obligatory
on the part of the employer to reinstate and
pay the dismissed employees wages during
the period of appeal until reversal by the
higher court. The CA construed this "higher
court" to be the CA, not the SC.
The CA reasoned out that it was a "higher
court" than the NLRC when it reversed the
NLRCs rulings; thus, the period for
computation should end when it promulgated
its decision reversing that of the NLRC, and
not on the date when the SC affirmed its
decision
Issue: Is the CA correct?
Ruling: Yes. As we held in the case of Garcia
v. Philippine Airlines:
The Court reaffirms the prevailing principle
that even if the order of reinstatement of the
Labor Arbiter is reversed on appeal, it is
obligatory on the part of the employer to
reinstate and pay the wages of the dismissed
employee during the period of appeal until
reversal by the higher court. It settles the
view that the Labor Arbiter's order of
reinstatement is immediately executory and
the employer has to either re-admit them to
work under the same terms and conditions
prevailing prior to their dismissal, or to
reinstate them in the payroll, and that failing
to exercise the options in the alternative,
employer must pay the employees salaries.
__________________________________________________
71. MANILA WATER COMPANY VS DEL
ROSARIO
G.R. NO. 188747, JANUARY 29, 2014
Facts: Del Rosario was employed as
Instrument Technician by Metropolitan
Waterworks and Sewerage System (MWSS).
Sometime in 1996, MWSS was reorganized
pursuant to Republic Act No. 8041 or the
National Water Crisis Act of 1995, and its
implementing guidelines Executive Order
No. 286. Because of the reorganization,
Manila Water absorbed some employees of
MWSS including Del Rosario. In August 1997,
Del Rosario officially became an employee of
Manila Water.
Sometime in May 2000, Manila Water
discovered that 24 water meters were
missing in its stockroom. Upon initial
investigation, it appeared that Del Rosario
and his co-employee were involved in the
pilferage and the sale of water meters to the
companys contractor. Consequently, Manila
Water issued a Memorandum, directing Del
Rosario to explain in writing within 72 hours
why he should not be dealt with
administratively for the loss of the said water
meters. In his letter-explanation, Del Rosario
confessed his involvement in the act charged
and pleaded for forgiveness, promising not to
commit similar acts in the future.
In June 2000, Manila Water conducted
a hearing to afford Del Rosario the
opportunity to personally defend himself and
to explain and clarify his defenses to the
charge against him. During the formal
investigation Del Rosario was found
responsible for the loss of the water meters
and therefore liable for violating Section 11.1
of the Companys Code of Conduct. Manila
Water proceeded to dismiss Del Rosario from
employment.
This prompted Del Rosario to file an
action for illegal dismissal claiming that his
severance from employment is without just
cause. In his Position Paper submitted before
the labor officer, Del Rosario averred that his
admission to the misconduct charged was not
voluntary but was coerced by the company.
Such admission therefore, made without the
assistance of a counsel, could not be made
basis in terminating his employment.
Refuting the allegations of Del
Rosario, Manila Water pointed out that he
was indeed involved in the taking of the
water meters from the companys stock room
and of selling these to a private contractor for
personal gain. Invoking Section 11.1 of the
Companys Code of Conduct, Manila Water
averred that such act of stealing the
companys property is punishable by
dismissal. The company invited the attention
of this Court to the fact that Del Rosario
himself confessed his involvement to the loss
of the water meters not only in his letter-
explanation, but also during the formal
investigation, and in both instances, pleaded
for his employers forgiveness.
The Labor Arbiter issued a Decision
dismissing for lack of merit the complaint
filed by Del Rosario who was, however,
awarded separation pay. According to the
Labor Arbiter, Del Rosarios length of service
for 21 years, without previous derogatory
record, warrants the award of separation pay.
Issue: WON the court erred in awarding
separation pay to respondent
Ruling: YES. As a general rule, an employee
who has been dismissed for any of the just
causes enumerated under Article 282 of the
Labor Code is not entitled to a separation pay.
Section 7, Rule I, Book VI of the Omnibus
Rules implementing the Labor Code provides:
Sec. 7. Termination of employment by
employer. The just causes for
terminating the services of an
employee shall be those provided in
Article 282 of the Code. The separation
from work of an employee for a just
cause does not entitle him to the
termination pay provided in the Code,
without prejudice, however, to
whatever rights, benefits and privileges
he may have under the applicable
individual or collective agreement with
the employer or voluntary employer
policy or practice.
In exceptional cases, however, the
Court has granted separation pay to a legally
dismissed employee as an act of "social
justice" or on "equitable grounds." In both
instances, it is required that the dismissal (1)
was not for serious misconduct; and (2) did not
reflect on the moral character of the employee.
The attendant circumstances in the
present case considered, we are constrained
to deny Del Rosario separation pay since the
admitted cause of his dismissal amounts to
serious misconduct. He is not only
responsible for the loss of the water meters in
flagrant violation of the companys policy but
his act is in utter disregard of his partnership
with his employer in the pursuit of mutual
benefits.
That Del Rosario rendered 21 years of
service to the company will not save the day
for him. Indubitably, the appellate court erred
in awarding separation pay to Del Rosario
without taking into consideration that the
transgression he committed constitutes a
serious offense. The grant of separation pay
to a dismissed employee is determined by the
cause of the dismissal. The years of service
may determine how much separation pay
may be awarded. It is, however, not the
reason why such pay should be granted at all.
In sum, we hold that the award of
separation pay or any other kind of financial
assistance to Del Rosario, under the
nomenclature of compassionate justice, is not
warranted in the instant case. A contrary rule
would have the effect of rewarding rather
than punishing an erring employee,
disturbing the noble concept of social justice.
___________________________________________________
72. INTERNATIONAL SCHOOL MANILA
AND/OR BRIAN McCAULEY
vs.
INTERNATIONAL SCHOOL ALLIANCE OF
EDUCATORS (ISAE)
Facts: Respondent Evangeline Santos was a
faculty of the International School Manila
since 1978. In 1992 she applied for a leave of
absence. When she returned in 1993, only
one teaching load for Spanish was available,
thus she agreed to teach 4 Filipino classes. As
per evaluation during the year 1993,
respondents evaluation stated that she
needed improvement in key areas such as use
of effective questioning techniques and
enforcement of academic and classroom
behavior among others. The following school
year, Santos expressed that she will be
teaching for the school year and that she did
not prefer a change in the teaching
assignments. For that school year, she was
again evaluated and her evaluation results
mirrored those areas in which she needed
improvement. The situation was the same for
school year 1995-1996. In 1996, a
Professional Growth Plan was signed by
Santos wherein she undertook to focus and
improve on the specifically stated areas of her
teaching that she need to improve on. Phase 1
was Planning. But even with the Plan and the
series of meetings and consultations
conducted her benefit, her over-all
performance did not improve. In fact, 8
months into the implementation of the
Professional Growth Plan, she was still in
Phase 1. In April 10, 1997, the school then
wrote a letter to Santos asking her to explain
why her services should not be terminated in
view of her performance way below the
standards set by said school. Santos was
given the chance to answer. A meeting was
then conducted where Santos was allowed to
bring counsel or representative. Santos was
accompanied by Raquel Ching, President of
the International School Alliance of
Educators. Santos was being charged by the
school with gross inefficiency or negligence in
the performance of duties. An administrative
investigation followed. The committee who
conducted the investigation recommended
that the employment of Santos cannot be
continued. Santos was informed in a letter of
her termination effective June 7, 1997, based
on the finding of the committee that despite 3
years of consultations with her supervisors,
no appreciable improvement was seen in her
performance.
Issue: Was Santos illegally dismissed?
Ruling: No. To constitute a valid dismissal
from employment, two requisites must
concur: (1) the dismissal must be for any of
the causes provided in Article 282 of the
Labor Code; and, (2) the employee must be
given an opportunity to be heard and to
defend himself.
In the collective bargaining
agreement (CBA) between the School and
ISAE for the years 1992-1995, Section 13 of
Appendix A thereof expressly states that
"termination of employment shall be in
accordance with the laws of the Philippines as
presented in the LABOR CODE.
In Century Iron Works, Inc. v. Baas,
the concept of gross and habitual neglect of
duties is explained as:
Gross negligence connotes want or
absence of or failure to exercise slight
care or diligence, or the entire
absence of care. It evinces a
thoughtless disregard of
consequences without exerting any
effort to avoid them. Fraud and willful
neglect of duties imply bad faith of the
employee in failing to perform his job,
to the detriment of the employer and
the latters business. Habitual neglect,
on the other hand, implies repeated
failure to perform ones duties for a
period of time, depending upon the
circumstances.
In Lim v. National Labor Relations
Commission:
Gross inefficiency falls within the
purview of "other causes analogous to
the foregoing," and constitutes,
therefore, just cause to terminate an
employee under Article 282 of the
Labor Code. One is analogous to
another if it is susceptible of
comparison with the latter either in
general or in some specific detail; or
has a close relationship with the
latter. "Gross inefficiency" is closely
related to "gross neglect," for both
involve specific acts of omission on
the part of the employee resulting in
damage to the employer or to his
business.
In Buiser vs. Leogardo, the Court
ruled that failure to observe prescribed
standards of work, or to fulfill reasonable
work assignments due to inefficiency may
constitute just cause for dismissal.
Viewed in light of the above doctrines,
the Court is not convinced that the actuations
of Santos complained of by the petitioners
constituted gross and habitual neglect of her
duties.
What can be gathered from a
thorough review of the records of this case is
that the inadequacies of Santos as a teacher
did not stem from a reckless disregard of the
welfare of her students or of the issues raised
by the School regarding her teaching. Far
from being tainted with bad faith, Santoss
failings appeared to have resulted from her
lack of necessary skills, in-depth knowledge,
and expertise to teach the Filipino language at
the standards required of her by the School.
The petitioners had sufficiently
proved the charge of gross inefficiency, which
warranted the dismissal of Santos from the
School.
The Court enunciated in Pea v.
National Labor Relations Commission73 that
"it is the prerogative of the school to set high
standards of efficiency for its teachers since
quality education is a mandate of the
Constitution. As long as the standards fixed
are reasonable and not arbitrary, courts are
not at liberty to set them aside." Moreover,
the prerogative of a school to provide
standards for its teachers and to determine
whether these standards have been met is in
accordance with academic freedom, which
gives the educational institution the right to
choose who should teach.
The Court finds that, not only did the
petitioners documentary evidence
sufficiently prove Santoss inefficient
performance of duties, but the same also
remained unrebutted by respondents own
evidence. On the contrary, Santos admits in
her pleadings that her performance as a
teacher of Filipino had not been satisfactory
but she prays for leniency on account of her
prior good record as a Spanish teacher at the
School. Indeed, even the Labor Arbiter, the
NLRC and the Court of Appeals agreed that
Santos was not without fault but the lower
tribunals deemed that termination was too
harsh a penalty.
Nonetheless, the Court finds that
petitioners had satisfactorily discharged
the burden of proving the existence of
gross inefficiency on the part of Santos,
warranting her separation from the
school.
As regards the requirements of
procedural due process, Section 2(d) of Rule
1 of The Implementing Rules of Book VI states
that:
For termination of employment based on just
causes as defined in Article 282 of the Labor
Code:
(i) A written notice served on the employee
specifying the ground or grounds for
termination, and giving said employee
reasonable opportunity within which to
explain his side.
(ii) A hearing or conference during which the
employee concerned, with the assistance of
counsel if he so desires is given opportunity
to respond to the charge, present his
evidence, or rebut the evidence presented
against him.
(iii) A written notice of termination served on
the employee, indicating that upon due
consideration of all the circumstances,
grounds have been established to justify his
termination
The School complied with the above
requirements. After a thorough evaluation of
Santoss performance, the School held a series
of conferences and meetings with Santos, in
order to improve her performance. On March
29, 1996, the School required Santos to
undertake a Professional Growth Plan.
Thereafter, when the intervention of the
School failed to yield any considerable
improvement on Santos, McCauley wrote her
a letter on April 10, 1997, which required her
to explain in writing within forty-eight (48)
hours why her employment should not be
terminated in view of her failure to meet the
standards of the School on very specific areas
of concern. On April 16, 1997, Santos
responded to McCauleys letter, asking why
she was being required to explain. On April
21, 1997, McCauley wrote Santos a letter
informing her that an administrative
investigation would be conducted on April 23,
1997 where she would be given the
opportunity to be heard. On April 23, 1997,
an administrative investigation was
conducted. Santos appeared therein with the
assistance of ISAE President Ching. In a letter
dated May 29, 1997, the School informed
Santos of its decision to terminate her
employment on the ground of her failure to
meet the standards of the School, which as
discussed was tantamount to gross
inefficiency.