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Table of Contents

THE APPLICABLE LAWS .................................................................................................................................................................... 1

GENERAL PRINCIPLES ...................................................................................................................................................................... 1
1. Singer Sewing Machine vs. NLRC, 193 SCRA 271 ..................................................................................................................... 1
2. Manila Golf Club vs. IAC, 237 SCRA 207 .................................................................................................................................... 1
3. Encyclopedia Britanica vs. NLRC, 264 SCRA 4 [1996] ................................................................................................................ 2
4. Carungcong vs. Sunlife, 283 SCRA 319 ...................................................................................................................................... 3
5. Ramos vs CA, 380 SCRA 467 ..................................................................................................................................................... 4
6. Sonza vs. ABS-CBN, G.R. No. 138051, June 10, 2004 ............................................................................................................... 5
7. Lazaro vs. Social Security Commission, 435 SCRA 472 [2004] .................................................................................................. 6
8. Phil. Global Communications v. De Vera, 459 SCRA 260 [2005] ................................................................................................ 6
9. ABS-CBN vs. Nazareno, G.R. No. 164156, Sept. 26, 2006 ......................................................................................................... 7
10. Francisco vs. NLRC, 500 SCRA 690 [2006]............................................................................................................................... 9
11. Nogales et. al., vs. Capitol Medical Center et al., G.R. No. 142625, December 19, 2006 ....................................................... 10
12. Coca-Cola Bottlers Phils., vs. Dr. Climaco, G.R. No. 146881, February 15, 2007 ................................................................... 10
13. Consolidated Broadcasting System vs. Oberio, G.R. No. 168424, June 8, 2007..................................................................... 12
14. Dumpit-Morillo vs. CA, G.R. No. 164652, June 8, 2007, citing 2004 Sonza............................................................................. 13
15. Lopez vs. Bodega City, G.R. No. 155731, Sept. 3, 2007, citing 2004 Abante & 2005 Consulta .............................................. 14
16. Calamba Medical Center vs. NLRC et al., G.R. No. 176484, Nov. 25, 2008............................................................................ 15
17. Escasinas et al., vs. Shangri-las Mactan Island Resort et al., G.R. No. 178827, March 4, 2009 ............................................. 16
18. Tongko v. Manufacturer Life Insurance Co. (MANULIFE) Inc., et al., G.R. No 167622, January 25, 2011 .............................. 18
19. Caong, Jr. v. Begualos, G.R. No. 179428, January 26, 2011 .................................................................................................. 21
20. Atok Big Wedge Company vs. Gison, G.R. No. 169510, August 8, 2011 ................................................................................ 22
21. Semblante vs. CA, G.R. No. 196426, August 15, 2011............................................................................................................ 24
22. Bernarte vs. Phil. Basketball Assoc., G.R. No. 192084, September 14, 2011 ......................................................................... 25
23. Lirio vs. Genovia, G.R. No. 169757, November 23, 2011 ........................................................................................................ 27
24. Jao vs. BCC Product Sales Inc., G.R. No. 163700, April 18, 2012 .......................................................................................... 30

RIGHT TO SECURITY OF TENURE .................................................................................................................................................. 31
1. ALU-TUCP vs. NLRC, 234 SCRA 678 [1994] ............................................................................................................................ 31
2. Cosmos Bottling Corp., vs NLRC, 255 SCRA 358 [1996] .......................................................................................................... 32
3. Purefoods v. NLRC 283 SCRA 136 [1997] ................................................................................................................................ 32
4. Phil. Fruit and Vegetable Industries v. NLRC, 310 SCRA 680 [1999] ........................................................................................ 35
5. Philips Semiconductor vs. Fardiquela, G.R. No. 141717, April 14, 2004 ................................................................................... 36
6. Alcira vs. NLRC, G.R. No. 149859, June 9, 2004 ...................................................................................................................... 38
7. Mitsubishi Motors Phils. vs. Chrysler Phil Labor Union, G.R. No. 148738, June 29, 2004 ......................................................... 39
8. Pangilinan vs. General Milling Co., G.R. No. 149329, July 2, 2004 ........................................................................................... 40
9. Ravago vs. Esso Eastern Marine Ltd., G.R. No. 158324, March 14, 2005 ................................................................................ 41
10. Hacienda Bino/Hortencia Stark vs. Cuenca, G.R. No. 150478, April 15, 2005, citing 2003 Hacienda Fatima ......................... 43
11. Phil Global Communication v. De Vera, G.R. No. 157214, June 7, 2005................................................................................. 44
12. Integrated Contractor and Plumbing Works, Inc. vs. National Labor Relations Commission and Glen Solon, G.R. No. 152427.
August 9, 2005 ............................................................................................................................................................................... 48
13. Lacuesta vs. Ateneo de Manila, G.R. No. 152777, December 9, 2005 .................................................................................... 49
14. Poseidon Fishing/Terry De Jesus v. NLRC, G.R. No. 168052, February 20. 2006 .................................................................. 50
15. Abesco Construction vs. Ramirez, G.R. No. 141168, April 10, 2006 ....................................................................................... 53
16. Cebu Metal Corp., vs. Saliling, G.R. No. 154463, September 5, 2006 ..................................................................................... 53
17. Liganza v. RBL Shipyard Corp., G.R. No. 159682, October 17, 2006...................................................................................... 54
18. Fabeza v. San Miguel Corp., G.R. No. 150658, February 9, 2007 ........................................................................................... 56
19. Soriano vs. NLRC, G.R. No. 165594, April 23, 2007, citing 2005 Filipina Pre-fabricated Bldg. System (Filisystem) ............... 58
20. Caseres vs. Universal Robina Sugar Milling Corp., et al., G.R. No. 159343, September 28, 2007.......................................... 59
21. Pier 8 Arrastre & Stevedoring Services, Inc. vs Boclot, G.R. No. 173849, September 28, 2007 ............................................. 61
22. Pacquing vs. Coca-Cola Bottlers Phils., Inc., G.R. No. 157966, January 31, 2008, citing Magsalin vs. National Organization of
Workingmen, G.R. No. 148492, May 9, 2003................................................................................................................................. 64

23. Cocomangas Hotel Beach Resort v. Visca, G.R. No. 167045, August 29, 2008...................................................................... 66
24. Price, et al., v Innodata Phils., G.R. No. 178505, September 30, 2008.................................................................................... 69
25. Agusan del Norte Electric Cooperative v. Cagampang, G.R. No. 167627, October 10, 2008 .................................................. 72
26. William Uy Construction et. al vs. Trinidad, GR No. 183250, March 10, 2010 ......................................................................... 74
27. Dacuital vs. L.M. Camus Engineering Corp.,G.R. No. 176748, September 1, 2010 ................................................................ 75
28. Millenium Erectors Corp. vs. Magallanes, G.R. No. 184362, November 15, 2010 ................................................................... 76
29. EXODUS INTERNATIONAL CONSTRUCTION CORPORATION vs. GUILLERMO BISCOCHO et. al.G.R. No. 166109,
February 23, 2011 .......................................................................................................................................................................... 77
30. Leyte Geothermal Power Progressive Employees Union v. Phil National Oil Co., G.R. No. 176351, March 30, 2011 ............ 79
31. St. Paul College Quezon City vs. Ancheta II, G.R. No. 169905, September 7, 2011 ............................................................... 82
32. Lynvil Fishing Enterprises vs. Ariola, G.R. No. 181974, February 1, 2012............................................................................... 84
33. D.M. Consunji Inc. vs. Jamin, G.R. No. 192514, April 18, 2012 citing Maraguinot................................................................... 86

MANAGEMENT PREROGATIVE ....................................................................................................................................................... 89
1. Dosch vs. NLRC, 123 SCRA 296 [1983] .................................................................................................................................... 89
2. PT&T v. Court of Appeals, G.R. No. 152057, September 23, 2003 ........................................................................................... 90
3. Mendoza vs. Rural Bank of Lucban, G.R. No. 155421, July 7, 2004 ......................................................................................... 92
4. Duncan Assn. of Detailman-PTFWO vs Glaxo Wellcome Phils. G.R. 162994 ........................................................................... 93
5. Norkis Trading Co., vs. NLRC, G.R. No. 168159, August 19, 2005 ........................................................................................... 94
6. PLDT vs. Paquio, G.R. No. 152689, October 12, 2005 .............................................................................................................. 95
7. Star Paper Corp., vs. Simbol, G.R. No. 164774, April 12, 2006 ................................................................................................. 97
8. Rivera vs. Solidbank, G.R. No. 163269, April 19, 2006.............................................................................................................. 99
9. Tiu v. Platinum Plans, Inc., G.R. No. 163512, February 28, 2007 ............................................................................................ 100
10. Duldulao vs. Court of Appeals, G.R. No. 164893, March 1, 2007 .......................................................................................... 102
11. Almario v. Philippine Airlines, G.R. No. 170928, September 11, 2007 ................................................................................... 103
12. San Miguel Corp. v. Pontillas, G.R. No. 155178, May 07, 2008 ............................................................................................. 104
13. Bisig Manggagawa sa Tryco vs. NLRC, G.R. No. 151309, Oct. 15, 2008.............................................................................. 105
14. Coca-Cola Bottler’s Philippines, Inc. v. Del Villar, G.R. No. 163091, October 6, 2010........................................................... 107
15. Manila Electric Co. vs. Lim, G.R. No. 184769, October 5, 2010 ............................................................................................ 111
16. Bello vs. Bonifacio Security Services, G.R. No. 188086, August 3, 2011 .............................................................................. 112
17. Alert Security and Investigation Agency vs. Pasawilan, G.R. No. 182397, September 14, 2011 ........................................... 113
18. Manila Pavilion Hotel vs. Delada, G.R. No. 189947, January 25, 2012 ................................................................................. 115

TERMINATION OF EMPLOYMENT ................................................................................................................................................. 117
1. Retuya v. NLRC, G.R. No. 148848, August 5, 2003, citing Bustamante .................................................................................. 117
2. Agabon vs. NLRC, G.R. No. 158693, November 17, 2004 ...................................................................................................... 118
3. Jaka Food Processing vs. Pacot, G.R. No. 151378, March 28, 2005 ...................................................................................... 121
4. Mauricio v. NLRC, G.R. No. 164635, November 17, 2005 ....................................................................................................... 122
5. Industrial Timber Corp. vs. Ababon, G.R. No. 164518, Janury 25, 2006 and March 28, 2007................................................. 124
6. Equitable Bank vs Sadac, G.R. No. 164772, June 8, 2006 ...................................................................................................... 125
7. Heirs of Sara Lee vs. Rey, G.R. No. 1499013, August 31, 2006 ............................................................................................. 126
8. Galaxi Steel Workers Union vs. NLRC, G.R. No. 165757, October 17, 2006, citing North Davao Mining ............................... 128
9. Sy vs. Metro Bank, G.R. No. 160618, November 2, 2006 ....................................................................................................... 129
10. King of Kings Transport vs. NLRC, G.R. No. 166208, June 29, 2007 .................................................................................... 130
11. Johnson & Johnson v. Johnson Office & Sales Union, G.R. No. 172799, July 6, 2007 ......................................................... 133
12. Asian Terminal vs. NLRC, G.R. No. 158458, December 19, 2007, citing Standard Electric Mfg. vs. Standard Electric
Employees Union, G.R. No. 166111, August 25, 2005 ................................................................................................................ 135
13. Smart Communications v. Astorga, G.R. No. 148142, January 28, 2008 .............................................................................. 136
14. Enriquez v. Bank of the Philippine Islands, G.R. No. 172812, February 12, 2008 ................................................................. 140
15. RB Michael Press vs. Galit, G.R. No. 153510, February 13, 2008 ......................................................................................... 142
16. Cosmos Bottling Corporation v. Nagrama, G.R. No 164403, March 4, 2008 ......................................................................... 145
17. School of the Holy Spirit of Q.C. vs. Taguiam, G.R. No. 165565, July 14, 2008 .................................................................... 146
18. Universal Staffing Services Inc. v. NLRC, G.R. No. 177576, July 21, 2008 ........................................................................... 148
19. Flight Attendants and Steward Association of the Philippines (FASAP) v. Philippine Airlines, G.R. No. 178083, G.R. No.
178083, July 22, 2008 .................................................................................................................................................................. 149
20. John Hancock Life Insurance Corp. vs. Davis, G.R. No. 169549, Sept. 3, 2008.................................................................... 155

21. Merin vs. NLRC, G.R. No. 171790, October 17, 2008 ........................................................................................................... 156
22. Yrasuegui vs. Phil Airlines, G.R. No. 168081, Oct. 17, 2008 ................................................................................................. 159
23. Sagales v. Rustans Commercial Corporation, G.R. No. 166554, November 27, 2008 .......................................................... 161
24. Garcia vs. PAL, G.R. No. 164856, Jan. 20, 2009, En Banc, citing Genuino vs. NLRC, G.R. No. 142732-33, December 4,
2007 ............................................................................................................................................................................................. 164
25. La Union Cement Workers Union et al., vs NLRC et al., G.R. No. 174621, January 30, 2009 .............................................. 166
26. Mendros, Jr. vs. Mitsubishi Motors Phils Corp., G.R. No. 169780, Feb. 16, 2009 ................................................................. 167
27. Rosa vs. Ambassador Hotel, G.R. No. 177059, March 13, 2009 ........................................................................................... 169
28. Motorola Phils. v. Ambrocio, G.R. No. 173279, March 30, 2009 ............................................................................................ 170
29. Perez et al., vs. Phil Telegraph & Telephone Company et al., G.R. No. 152048, April 7, 2009 ............................................. 171
30. Telecommunications Distributors Specialists Inc. et al., vs. Garriel, G.R. No. 174981, May 25, 2009, citing 2009 Perez ..... 173
31. Triumph International Philippines v. Apostol, G.R. No. 164423, June 16, 2009 ..................................................................... 175
32. Technological Institute of the Phils Teachers and Employees Organization vs. Court of Appeals, et al., G.R. No. 158703,
June 26, 2009 .............................................................................................................................................................................. 177
33. Llamas v. Ocean Gateway Maritime and Management Services Inc., G.R. No. 179293, August 14, 2009 ........................... 179
34. Lowe Inc., v. CA, G.R. 164813 & 174590, August 14, 2009 .................................................................................................. 180
35. Estacio v. Pampanga I Electric Cooperative, G.R. No. 183196, August 19, 2009 ................................................................. 182
36. Maralit v. PNB, G.R. No. 163788, August 24, 2009 ............................................................................................................... 183
37. Quevedo v. Benguet Electric Cooperative, G.R. No. 168927, September 11, 2009 .............................................................. 186
38. Placido et al. v. NLRC, G.R. No. 180888, September 18, 2009 ............................................................................................. 187
39. Martinez v. B&B Fish Broker, G.R. No. 179985, September 18, 2009 ................................................................................... 189
40. Flight Attendants and Steward Association of the Phils vs. Phil Airlines, G.R. No. 178083, October 2, 2009, see July 22,
2008, main decision ..................................................................................................................................................................... 191
41. Eats-Cetera Food Services Outlet v. Letran, G.R. No. 179507, October 2, 2009 .................................................................. 192
42. Plantation Bay Resort and Spa, et al. vs. Dubrico, G.R. No. 182216, December 4, 2009 ..................................................... 195
43. Fulache v. ABS-CBN Broadcasting Corporation, G.R. No. 183810, January 21, 2010 .......................................................... 196
44. Ancheta vs. Destiny Financial Plans Inc. et al., G.R. No. 179702, Feb. 16, 2010 .................................................................. 198
45. Javellana, Jr. vs. Belen, G.R. Nos. 181913 & 182158, March 5, 2010................................................................................... 200
46. WPP Marketing Communications Inc., et al., vs. Galera, G.R. No. 169207, March 25, 2010 ................................................ 201
47. Mercado v. AMA Computer College, G.R. No. 183572, April 13, 2010 .................................................................................. 202
48. Pantoja vs. SCA Hygiene Products Corp., G.R. No. 163554, April 23, 2010 ......................................................................... 204
49. BPI v. NLRC, G.R. No. 179801, June 18, 2010 ..................................................................................................................... 205
50. Phil. Rural Reconstruction Movement vs. Pulgar, G.R. No. 169227, July 5, 2010 ................................................................. 207
51. Maribago Bluewater Beach Resort v. Dual, G.R. No. 180660, July 20, 2010 ........................................................................ 209
52. New Puerto Commercial vs. Lopez, G.R. No. 169999, July 26, 2010 .................................................................................... 212
53. Artificio vs. NLRC, G.R. No. 172988, July 26, 2010 ............................................................................................................... 214
54. Calipay vs. NLRC, G.R. No. 166411, August 3, 2010 ............................................................................................................ 216
55. Nacague v. Sulpicio Lines, G.R. No. 172589, August 8, 2010 ............................................................................................... 218
56. Century Canning Corp. vs. Ramil, G.R. No. 171630, August 8, 2010 .................................................................................... 220
57. D.M Consunji vs. Gobres, G.R. No. 169170, August 8, 2010 ................................................................................................ 222
58. Nagkaka-sang Lakas ng Manggagawa sa Keihin vs. Keihin Phils. Corp., G.R. No. 171115, August 9, 2010 ....................... 224
59. Garcia v. Molina, G.R. No. 157383, August 18, 2010 ............................................................................................................ 225
60. Escario v. NLRC, G.R. No. 160302, September 27, 2010 ..................................................................................................... 227
61. Simizu Phils Contractors v. Callanta, G.R. No. 165923, September 29, 2010 ....................................................................... 229
62. Solidbank Corporation v. Gamier, G.R. No. 159461, November 15, 2010 ............................................................................. 232
63. Coca-Cola Export Corp. v. Gacayan, G.R. No. 149433, December 15, 2010 ........................................................................ 234
64. Robinsons Galleria/Robinsons Supermarket v. Ranchez, G.R. No. 177937, January 19, 2011 ............................................ 236
65. Hospital Management Services v. HMSI-Medical Center Manila Employees Asso., G.R. No. 176287, January 31, 2011 ... 238
66. Culili v. Eastern Telecommunications Phils., G.R. No. 165381, February 9, 2011 ................................................................. 241
67. Plastimer Industrial Corp. v. Gopo, G.R. No. 183390, February 16, 2011 ............................................................................. 242
68. St. Mary’s Academy of Dipolog City vs. Palacio, G.R. No. 164913, September 8, 2010 ....................................................... 245
69. PLDT vs. Teves, G.R. No. 143511, November 15, 2010 ....................................................................................................... 246
70. University of the Immaculate Concepcion vs. NLRC, G.R. No. 181146, January 26, 2011 ................................................... 248
71. Simizu Phils Contractors v. Callanta, G.R. No. 165923, September 29, 2010 ....................................................................... 249
72. Manila Mining Corp. Employees Association-FFW vs. Manila Mining Corp., G.R. No. 178222-23, September 29, 2010...... 252

73. Lopez vs. Alturas Group of Companies, G.R. No. 191008, April 11, 2011 ............................................................................. 253
74. Apacible vs. Multimed Industries Inc., G.R. No. 178903, May 30, 2011................................................................................. 255
75. Barroga vs. Data Center College, G.R. No. 174158, June 27, 2011 ...................................................................................... 257
76. Lopez vs. Keppel Bank Phils., G.R. No. 176800, September 5, 2011.................................................................................... 258
77. St. Paul College Quezon City vs. Ancheta II, G.R. No. 169905, September 7, 2011 ............................................................. 259
78. Jumuad vs. Hi-Flyer Food, G.R. No. 187887, September 7, 2011 ......................................................................................... 261
79. Nissan Motor Phils. Angelo, G.R. No. 164181, September 14, 2011 ..................................................................................... 262
80. Phil. National Bank vs. Padao, G.R. No. 180849, November 16, 2011 .................................................................................. 263
81. Tamsons Enterprises Inc. vs. CA, G.R. No. 192881, November 16, 2011 ............................................................................. 265
82. Concepcion vs. Minex Import Corp., G.R. No. 153569, January 24, 2012 ............................................................................. 267
83. Morales vs. Harbour Centre Port Terminal Inc., G.R. No. 174208, January 25, 2012 ........................................................... 269
84. Mansion Printing Center vs. Bitara, G.R. No. 168120, January 25, 2012 .............................................................................. 270
85. Manila Electric Co. vs. Beltran, G.R. No. 173774, January 30, 2012 ..................................................................................... 271
86. Bank of Lubao vs. Manabat, G.R. No. 188722, February 1, 2012 ......................................................................................... 273
87. Canadian Opportunities Unlimited vs. Dalangin, G.R. No. 172223, February 6, 2012 ........................................................... 275
88. Manila Electric Co. vs. Gala, G.R. No. 191288 & 191304, March 7, 2012 ............................................................................. 277
89. Aro vs. NLRC, G.R. No. 174792, March 7, 2012.................................................................................................................... 278
90. Ymbong vs. ABS-CBN Broadcasting Corp., G.R. No. 184885, March 7, 2012 ...................................................................... 279
91. Blue Sky Trading Co. vs. Blas, G.R. No. 190559, March 7, 2012 .......................................................................................... 281
92. Internation management Services vs. Logarta, G.R. No. 163657, April 18, 2012 .................................................................. 283
93. Jiao vs. NLRC, G.R. No. 182331, April 18, 2012 ................................................................................................................... 286
94. Realda vs. New Age Graphics Inc., G.R. No. 192190, April 25, 2012 .................................................................................... 288
95. Kakampi and Its Members Panuelos vs. Kingspoint Express & Logistics, G.R. No. 194813, April 25, 2012 ......................... 289

SUSPENSION OF BUSINESS OPERATIONS................................................................................................................................. 292
1. JPL Marketing Promotion vs. Court of Appeals, G.R. No. 151966, July 8, 2005...................................................................... 292
2. Pido vs NLRC, G.R. No. 169812, February 23, 2007............................................................................................................... 293
3. Megaforce Security & Allied Services vs. Lactao, G.R. No. 160940, July 21, 2008 ................................................................. 294
4. National Mines and Allied Workers Union vs. Marcopper Mining Corp., G.R. No. 174641, Nov. 11, 2008 .............................. 296
5. Eagle Star Security Services Inc. vs. Mirando et al., G.R. No. 179512, July 30, 2009............................................................. 298
6. Nationwide Security & Allied Services v. Valderama, G.R. No. 186614, February 23, 2011 ................................................... 300
7. Nippon Housing Phils. vs. Leynes, G.R. No. 177816, August 3, 2011 ..................................................................................... 302

DISEASE AS A GROUND FOR TERMINATION .............................................................................................................................. 305
1. Sy vs. Court of Appeals, G.R. No. 142293, February 27, 2003 ................................................................................................ 305
2. Manly Express vs. Payong, G.R. No. 167462, October 25, 2005 ............................................................................................ 306
3. Duterte vs. Kingswood Trading Co., G.R. No. 160325, October 4, 2007 ................................................................................. 307
4. Villaruel vs. Yeo Han Guan, G.R. No. 169191, June 1, 2011 ................................................................................................... 308

OTHER CAUSES OF SEVERANCE OF EMPLOYMENT RELATION ............................................................................................. 310
1. Pantranco North Express vs. NLRC, 259 SCRA 161 [1996] .................................................................................................... 310
2. Phil. Airlines vs. Airline Pilots Asso. Of Phils., G.R. No. 143686, January 15, 2002 ................................................................ 312
3. Cainta Catholic School vs. Cainta Catholic School Employees Union, G.R. No. 151021, May 4, 2006 citing 1996 Pantranco
North Express .............................................................................................................................................................................. 312
4. Jaculbe vs. Silliman University, G.R. No. 156934, March 16, 2007 ......................................................................................... 315
5. Globe Telecom vs. Crisologo, G.R. No. 17644, August 10, 2007 ............................................................................................ 318
6. BMG Records Phils et al., vs. Aparecio, et al., G.R. No. 153290, September 5, 2007, citing Phil Today vs. NLRC, 267 SCRA
202 [1996] .................................................................................................................................................................................... 320
7. Blue Angel Manpower and Security Services vs. CA, G.R. No. 161196, July 28, 2008 ........................................................... 322
8. Guerzon Jr et al vs. Pasig Industries Inc., et al., G.R. No. 170266, Sept. 12, 2008 ................................................................. 323
9. Suarez Jr. et al., vs. National Steel Corp., G.R. No. 150180, Oct. 17, 2008 ............................................................................ 325
10. Goodrich Mfg Corp vs. Ativo et al., G.R. No. 188002, Feb. 1, 2010 ....................................................................................... 326
11. Korean Air Co. Ltd. v. Yuson, G.R. No. 170369, June 16, 2010 ............................................................................................ 328
12. Cercado v. Uniprom Inc., G.R. No. 188154, October 13, 2010 .............................................................................................. 329
13. Bilbao vs. Saudi Arabian Airlines, G.R. No. 183915, December 14, 2011 ............................................................................. 331
14. San Miguel Properties vs. Gucaban, G.R. No. 153982, July 18, 2011 ................................................................................... 332

15. Skippers United Pacific vs. Doza, G.R. No. 175558, February 8, 2012 ................................................................................. 334

PRESCRIPTION OF CLAIMS .......................................................................................................................................................... 337
1. Ludo & Luym Corp. vs Saornido, G.R. No. 140960, January 20, 2003 .................................................................................... 337
2. Degamo vs. Avantgarde Shipping corp., G.R. no. 154460, November 22, 2005 ..................................................................... 338
3. Intercontinental Broadcasting Corp. vs. Panganiban, G.R. No. 151407, February 6, 2007 .................................................... 339
4. Far East Agricultural Supply vs. Lebatique, G.R. No. 162813, February 12, 2007 ................................................................. 341
5. Victory Liner, Inc. vs. Race, G.R. No. 164820, March 28, 2007 ............................................................................................... 342
6. J.K. Mercado & Sons Agricultural Enterprises vs. Sto. Tomas, G.R. No. 158084, August 29, 2008 ........................................ 343
7. Reyes vs. Nlrc, G.R. No. 180551, February 10, 2009 .............................................................................................................. 344
8. LWV Construction Corp. vs. Dupo, G.R. No. 172342, July 13, 2009 ....................................................................................... 345
9. PLDT v. Pingol, G.R. No. 182622, September 8, 2010 ............................................................................................................ 347
10. Medline Management Inc. vs. Roslinda, G.R. No. 168715, September 15, 2010 .................................................................. 350
11. University of East vs. University of East Employees Assoc., G.R. No. 179593, September 14, 2011 ................................... 351

LABOR RELATIONS
Atty. Jefferson M. Marquez

THE APPLICABLE LAWS

GENERAL PRINCIPLES

CASES:

1. Singer Sewing Machine vs. NLRC, 193 SCRA 271

Facts:

Singer Machine Collectors Union-Baguio filed a petition for direct certification as the sole and exclusive bargaining agent of all collectors of
Singer Sewing Machine. The company opposed the petition mainly because the union members are not employees but independent contractors
as evidenced by the collection agency agreement which they signed.

Med-Arbiter ruled that there exists an employee-employer relationship and granted the certification election which was affirmed by Sec. Drilon.
The company files the present petition on the determination of the relationship. The union insists that the provisions of the Collection Agreement
belie the company’s position that the union members are independent contractors.

Ruling:

The present case calls for the application of the control test, which if not satisfied, would lead to the conclusion that no employee-employer
relationship exists. If the union members are not employees, no right to organize for the purpose of bargaining or as a bargaining agent cannot
be recognized. The following elements are generally considered in the determination of the relationship: the selection and engagement of the
employee, payment of wages, power of dismissal and the power to control the employee’s conduct which is the most important element. The
nature of the relationship between a company and its collecting agents depends on the circumstances of each particular relationship. Not all
collecting agents are employees and neither are all collecting agents independent contractors. The agreement confirms the status of the
collecting agents as independent contractor. The requirement that collection agents utilize only receipt forms and report forms issued by the
company and that reports shall be submitted at least once a week is not necessarily an indication of control over the means by which the job
collection is to be performed. Even if report requirements are to be called control measures, any control is only with respect to the end result of
the collection since the requirements regulate the things to be done after the performance of the collection job or the rendition of service.

The plain language of the agreement reveals that the designation as collection agent does not create an employment relationship and that the
applicant is to be considered at all times as an independent contractor. The court finds that since private respondents are not employees of the
company, they are not entitled to the constitutional right to form or join a labor organization for the purposes of collective bargaining. There is no
constitutional and legal basis for their union to be granted their petition for direct certification.

2. Manila Golf Club vs. IAC, 237 SCRA 207

Facts:

Page 1

LABOR RELATIONS
Atty. Jefferson M. Marquez

This is originally filed with the Social Security Commission (SSC) via petition of 17 persons who styled themselves as “ Caddies of Manila Golf
and Country Club-PTCCEA” for the coverage and availment of benefits of the Social Security Act as amended, PTCCEA (Philippine Technical,
Clerical, Commercial Employees Association) a labor organization where which they claim for membership. The same time two other
proceedings were filed and pending. These are certification election case filed by PTCCEA on behalf of the same caddies of Manila Golf and
Country club which was in favor of the caddies and compulsory arbitration case involving PTCCEA and Manila Golf and Country Club which was
dismissed and ruled that there was no employer-employee relationship between the caddies and the club.

The question involved in the case is whether or not rendering caddying services for members of golf clubs and their guests in said clubs’ courses
or premises are the employees of such clubs and therefore within the compulsory coverage of the Social Security System (SSS).

Ruling:

The Court does not agree that the facts logically point to the employer-employee relationship. In the very nature of things, caddies must submit
to some supervision of their conduct while enjoying the privilege of pursuing their occupation within the premises and grounds of whatever club
they do work in. They work for the club to which they attach themselves on sufferance but, on the other hand, also without having to observe any
working hours, free to leave anytime they please, to stay away for as long they like.

These considerations clash frontally with the concept of employment.

It can happen that a caddy who has rendered services to a player on one day may still find sufficient time to work elsewhere. Under such
circumstances, the caddy may leave the premises and to go to such other place of work that he wishes. These are things beyond the control of
the petitioner. The caddy (LLamar) is not an employee of petitioner Manila Golf and Country Club and the petitioner is under no obligation to
report him for compulsory coverage of SSS.

3. Encyclopedia Britanica vs. NLRC, 264 SCRA 4 [1996]

Facts:

Limjoco was a Sales Divison of Encyclopaedia Britannica and was in charge of selling the products through some sales representatives. As
compensation, he would receive commissions from the products sold by his agents. He was also allowed to use the petitioner’s name, goodwill
and logo. It was agreed that office expenses would be deducted from Limjoco’s commissions. In 1974, Limjoco resigned to pursue his private
business and filed a complaint against petitioner for alleged non-payment of separation pay and other benefits and also illegal deduction from
sales commissions. Petitioner alleged that Limjoco was not an employee of the company but an independent dealer authorized to promote and
sell its products and in return, received commissions therein. Petitioner also claims that it had no control and supervision over the complainant as
to the manners and means he conducted his business operations. Limjoco maintained otherwise. He alleged he was hired by the petitioner and
was assigned in the sales department.

The Labor Arbiter ruled that Limjoco was an employee of the company. NLRC also affirmed the decision and opined that there was no evidence
supporting allegation that Limjoco was an independent contractor or dealer. On appeal, petitioner assails that there was no employee-employer

Page 2

and in turn is compensated in according to the result of his efforts and not the amount thereof. the following elements must be present: selection and engagement of the employee. Sunlife. Ruling: There was no employee-employer relationship. limitations on his authority. The issuance of guidelines by the petitioner was merely guidelines on company policies which sales managers follow and impose on their respective agents. Hence. LABOR RELATIONS Atty. had been receiving reports of anomalies in relation thereto from unit managers and agents. There she succeeded in obtaining a favorable judgment. Deveza. It affirmed that no employment relationship existed between Carungcong and Sun Life. Labor Arbiter found that there existed an employer-employee relationship between her and Sun Life. CLU. which advised of the termination of her relationship with Sun Life. In determining the relationship. Marquez relationship. In virtue of which she was designated the latter’s agent to solicit applications for its insurance and annuity policies. Carungcong and Sun Life executed another Agreement named New Business Manager with the function generally to manage a New Business Office established. the National Labor Relations Commission reversed the Arbiter’s judgment. commenced an inquiry into the special fund availments of Carungcong and other New Business Managers. there was no employee-employer relationship. Director. Carungcong vs. 4. and termination of the agreement by death. Under the control test. The element of control is absent where a person who works for another does so more or less at his own pleasure and is not subject to definite hours or conditions of work. 283 SCRA 319 Facts: Susan Carungcong began her career in the insurance industry in 1974 as an agent of Sun Life Assurance Company of Canada. He was merely an agent or an independent dealer of the petitioner. 1990. Jefferson M. The power of control is commonly regarded as the most crucial and determinative indicator of the presence or absence of an employee-employer relationship. Manager’s Supplementary Agreement. Carungcong was confronted with and asked to explain the discrepancies set out in Sibayan’s report. dealt with such matters as the agent’s commissions. Eleizer Sibayan. Carungcong promptly instituted proceedings for vindication in the Arbitration Branch of the National Labor Relations Commissions on January 16. It explicitly described as a “further agreement”. She contented that she was an employee subject to control and supervision by Sun Life. On appeal. Ruling: Page 3 . Manager of Sun Life’s Internal Audit Department. the factual circumstances must be considered. an employee-employer relationship exists where the person for whom the services are performed reserves a right to control not only the end to be achieved. but also the manner and means to be employed in reaching that end. He was free to conduct his work and he was free to engage in other means of livelihood. This latest Agreement stressed that the New Business Manager in performance of his duties defined herein. denominated Career Agent’s or Unit Manager’s Agreement. or by written notice with or without cause. Thereafter. In ascertaining the employee-employer relationship. The first. power of dismissal and power to control the employee’s conduct. Respondent Lance Kemp. payment of wages. Ms. The second was titled. She signed an Agent Agreement with Sun Life. This contract was superseded some five years later when she signed two (2) new agreements. She was given a letter signed by Metron V. shall be considered an independent contractor and not an employee of Sun Life. on January 1990. and that under no circumstance shall the New Business Manager and/or his employees be considered employees of Sun Life. Marketing. his obligations. Limjoco was not an employee of the company since he had the free rein in the means and methods for conducting the marketing operations.

By 10 am. but the means to be used in reaching such an end. fire and exercise real control over their attending and visiting consultant staff. LABOR RELATIONS Atty. Dr. It does not necessarily create any employer-employee relationship where the employers’ controls have to interfere in the methods and means by which employee would like employ to arrive at the desired results. She was not paid to a fixed salary and was mainly paid by commissions depending on the volume of her performance. Carungcong admitted that she was free to work as she pleases. Marquez Noteworthy is that this last agreement which emphasized. It has been consistently held that in determining whether an employer-employee relationship exists between the parties. On the following day. She was not an employee of Sun Life Co. Erlinda remained in comatose condition until she died. It was indicated in the very face of the contract. Page 4 . Ramos vs CA. she was ready for operation as early as 7:30 am. Since the ill-fated operation. The court finds that there is no employer-employee relationship between the doctors and the hospital. Around 9:30. (3) the power to hire and fire. Jefferson M. At 3 pm. In applying the four fold test. Dr. Rogelio wanted to pull out his wife from the operating room. DLSMC cannot be considered an employer of the respondent doctors. She was referred to Dr. Carungcong is an independent contractor. The nail beds of Erlinda were bluish discoloration in her left hand. and (4) the power to control not only the end to be achieved. The operation was scheduled on June 17. Ruling: Private Hospitals hire. While consultants are not technically employees. at the place and time she felt convenient for her to do so. Hosaka has not yet arrived. Erlinda was admitted to the medical center the day before the operation. who agreed to do the operation. It is the patient who pays the consultants. that in performance of her duties defined herein. and that under no circumstance shall the New Business Manager and/or his employees be considered employees of Sun Life. like the “Career Agent’s or Unit Manager’s Agreement” first signed by her. The control test is determining. the hiring and the right to terminate consultants fulfill the hallmarks of an employer-employee relationship with the exception of payment of wages. 380 SCRA 467 Facts: Petitioner Erlinda Ramos was advised to undergo an operation for the removal of her stone in the gall bladder. The hospital’s obligation is limited to providing the patient with the preferred room accommodation and other things that will ensure that the doctor’s orders are carried out. Erlinda was being wheeled to the Intensive care Unit and stayed there for a month. 5. The hospital does not hire consultants but it accredits and grants him the privilege of maintaining a clinic and/or admitting patients. The hospital cannot dismiss the consultant but he may lose his privileges granted by the hospital. Hosaka and Guiterrez. Hosaka. 1985 in the De los Santos Medical Center. Carungcong would be considered an independent contractor and not an employee of Sun Life. Guiterres tried to intubate Erlinda. (2) payment of wages. One of the issues involved was that there was an employee-employer relationship that existed between the medical center and Drs. The rules and regulations of the company is not sufficient to establish an employer-employee relationship. the control exercised. a surgeon. the following elements must be present: (1) selection and engagement of services. The family of Ramos sued them for damages. Dr. Hosaka finally arrived at 12:10 pm more than 3 hours of the scheduled operation.

ABS-CBN did not exercise control over the means and methods of performance of Sonza’s work. ABS-CBN did not instruct SONZA how to perform his job. travel allowance and amounts under the Employees Stock Option Plan (ESOP). either party may terminate their relationship. 000 for the second and third year. 000 for the first year and P317. Referred to in the agreement as agent." ABS-CBN’s sole concern was the quality of the shows and their standing in the ratings. The right of labor to security of tenure cannot operate to deprive an individual. 2004 Facts: In May 1994. 138051. as President and general manager. The control test is the most important test our courts apply in distinguishing an employee from an independent contractor. For violation of any provision of the Agreement. Sonza’s work as television and radio program host required special skills and talent. CA also affirmed the decision of NLRC. The right of labor to security of tenure as guaranteed in the Constitution arises only if there is an employer-employee relationship under labor laws. the so-called "control test". ABS-CBN claims that there exists a prevailing practice in the broadcast and entertainment industries to treat talents like Sonza as independent contractors. The converse holds true as well – the less control the hirer exercises.13th month pay. appeared on television. This test is based on the extent of control the hirer exercises over a worker. Marquez 6. Sonza vs. we find that SONZA is not an employee but an independent contractor. of an independent contractual relationship. is a circumstance indicative. However. June 10. but not conclusive. and Tiangco as its EVP and treasurer. G. The greater the supervision and control the hirer exercises. How SONZA delivered his lines. Page 5 . Independent contractors often present themselves to possess unique skills. separation pay. and sounded on radio were outside ABS-CBN’s control. NLRC affirmed the decision of the Labor Arbiter. the power of dismissal and the employer’s power to control the employee on the means and methods by which the work is accomplished. ABS-CBN agreed to pay Sonza a monthly talent fee of P310.R. On April 1996. ABS-CBN was represented by its corporate officers while MJMDC was represented by Sonza. The Labor Arbiter dismissed the complaint and found that there is no employee-employer relationship. the payment of wages. ABS- CBN contended that no employee-employer relationship existed between the parties. Jefferson M. A radio broadcast specialist who works under minimal supervision is an independent contractor. LABOR RELATIONS Atty. All the talent fees and benefits paid to SONZA were the result of negotiations that led to the Agreement. Sonza filed with the Department of Labor and Employment a complaint alleging that ABS-CBN did not pay his salaries. the more likely the worker is considered an independent contractor. After the said letter. ABS-CBN. No. expertise or talent to distinguish them from ordinary employees. ABS-CBN signed an agreement with the Mel and Jay Management and Development Corporation (MJMDC). MJMDC agreed to provide Sonza’s services exclusively to ABS-CBN as talent for radio and television. possessed with special skills. The right to life and livelihood guarantees this freedom to contract as independent contractors. Applying the control test to the present case. SONZA only needed his skills and talent. Sonza’s services to co-host its television and radio programs are because of his peculiar talents. signing bonus. talent and celebrity status not possessed by ordinary employees. Ruling: Case law has consistently held that the elements of an employee-employer relationship are selection and engagement of the employee. ABS-CBN merely reserved the right to modify the program format and airtime schedule "for more effective programming. skills and celebrity status. The specific selection and hiring of SONZA. expertise or talent enjoy the freedom to offer their services as independent contractors. To perform his work. Individuals with special skills. the more likely the worker is deemed an employee. of his right to contract as an independent contractor. Clearly. because of his unique skills. expertise and talent. which SONZA admittedly possesses. is the most important element. The last element. service incentive pay. ABS-CBN continued to remit Sonza’s monthly talent fees but opened another account for the same purpose. Sonza wrote a letter to ABS-CBN where he irrevocably resigned in view of the recent events concerning his program and career.

the Court upheld the existence of an employer-employee relationship between the insurance company and its agents. Social Security Commission. Among the respondents was herein petitioner Angelito L. In the case of Cosmopolitan Funeral Homes. Neither does it follow that a person who does not observe normal hours of work cannot be deemed an employee. Laudato filed a petition before the SSC for social security coverage and remittance of unpaid monthly social security contributions against her three (3) employers. The Court agrees with the findings of the SSC and the CA. as the claimant according to it. whether the employer controls or has reserved the right to control the employee. SSC promulgated a decision rendering that Laudato is a regular employee of Royal Star Marketing and entitled to social security contributions. despite the fact that the compensation that the agents on commission received was not paid by the company but by the investor or the person insured. whether the "employer" controls or has reserved the right to control the "employee" not only as to the result of the work to be done but also as to the means and methods by which the same is to be accomplished. The relevant factor remains. as stated earlier. not only as to the result of the work done. The SSC. Maalat. 435 SCRA 472 [2004] Facts: Respondent Rosalina M. Jefferson M. the company of Lazaro. was a “supervisor on commission basis” who did not observe normal hours of work. the employer similarly denied the existence of an employer-employee relationship.” that is. Marquez 7. For the purpose of determining whether the respondent is entitled to social security contributions. She raised that Laudato was not an employee of Royal Star Marketing since Royal Star had no control over the activities of Laudato. LABOR RELATIONS Atty. [is] exempt from the observance of normal hours of work for his compensation is measured by the number of sales he makes.” 8. Lazaro denied that Laudato was an employee but instead claimed that she was an agent of the company. applying the control test found that Laudato was an employee of Royal Star. it must be shown that Laudato was a regular employee of Royal Star Marketing. which is engaged in the business of selling home appliances. Global Communications v. v. but also as to the means and methods by which the same is accomplished. proprietor of Royal Star Marketing (“Royal Star”). although compensated on commission basis. Inc. In the case of Grepalife v. The fact that Laudato was paid by way of commission does not preclude the establishment of an employer-employee relationship. De Vera. This petition before the Court assails same arguments raised by Lazaro in SSC. Lazaro. the determination of employer-employee relationship warrants the application of the “control test. This Court declared that there was an employer-employee relationship. noting that “[the] supervisor. Judico. Ruling: It is an accepted doctrine that for the purposes of coverage under the Social Security Act. 459 SCRA 260 [2005] Facts: Page 6 . Lazaro vs. Phil. Lazaro also maintained that she was not mandated to work of definite work hours and thus not deemed to be a regular employee of Royal Star Marketing. Lazaro filed a petition for review before the CA where CA ruled that Laudato was an employee of Royal Star Marketing.

Petitioner had no control over the means and methods by which respondent went about performing his work at the company premises. On January 1997. it was renewed verbally. It simply runs against the grain of common experience to imagine that an ordinary employee has yet to bill his employer to receive his salary. Remarkably absent is the element of control whereby the employer has reserved the right to control the employee not only as to the result of the work done but also as to the means and methods by which the same is to be accomplished. Sept. The controversy rose when petitioner terminated his engagement. is a corporation engaged in the business of communication services and allied activities while Ricardo de Vera is a physician by profession whom petitioner enlisted to attend to the medical needs of its employees. Philcom filed this petition involving the difference of a job contracting agreements from employee-employer relationship. Eulau.R. which thereby negates the element of control in their relationship. the parties themselves practically agreed on every terms and conditions of the engagement. Dr. alleging that he had been actually employed by the company as its company physician since 1991. it reversed the decision of the Labor Arbiter stating that de Vera is a regular employee and directed the company to reinstate him. No. The record are replete with evidence showing that respondent had to bill petitioner for his monthly professional fees. ABS-CBN vs. G. de Vera fileda complaint for illegal dismissal before the NLRC. Jefferson M. The parties agreed and formalized the respondent’s proposal in a document denominated as retainership contract which will be for a period of one year. Philcom appealed to the CA where it rendered decision deleting the award but reinstating de Vera. 26. Marquez Philippine Global Communications inc. The agreement went until 1994. de Vera of its decision to discontinue the latter’s retainer contract because the management has decided that it would be more practical to provide medical services to its employees through accredited hospitals near the company premises. 164156. Either may terminate the arrangement at will. Issue: Whether or not there is an employer-employee relationship between the parties. 9. in the years 1995-1996. Nazareno. The commission rendered decision in favor of Philcom and dismissed the complaint saying that de Vera was an independent contractor. 2006 Page 7 . with or without cause. subject to renewal and clearly stated that respondent will cover the retainership the company previously with Dr. In fine. The power to terminate the parties’ relationship was mutually vested on both. The turning point of the parties’ relationship was when petitioner. thru a letter bearing the subject TERMINATION – RETAINERSHIP CONTRACT. On appeal to NLRC. de Vera offered his services to petitioner. informed Dr. SC Ruling: The elements of an employer-employee relationship is wanting in this case. LABOR RELATIONS Atty. In 1981.

The Labor Arbiter rendered judgment in favor of the respondents. It was held that where a person has rendered at least one year of service. and relay of telecommunication signals. a circumstance negating independent contractual relationship. Premium Pay. The issue involved is whether the respondents were considered regular employees of ABS-CBN. respondents were not included to the CBA. Sick Leave Pay. such work is a regular employment of such employee and not an independent contractor.” Page 8 . 1996 to December 11. On December 19. Petitioner employed respondents Nazareno. Moreover. however. Gerzon. no peculiar or unique skill. if the employee has been performing the job for at least a year. since petitioner refused to recognize PAs as part of the bargaining unit. only talent-artists were excluded from the CBA and not production assistants who are regular employees of the respondents. 1999. In Universal Robina Corporation v. Deiparine. or where the work is continuous or intermittent. 2000. As regular employees. 1996. the reason being that a customary appointment is not indispensable before one may be formally declared as having attained regular status. NLRC affirmed the decision of the Labor Arbiter. Underpayment of Overtime Pay. the employer-employee relationship between petitioner and respondents has been proven. They were assigned at the news and public affairs. However. of determining regular employment is the reasonable connection between the particular activity performed by the employee in relation to the usual trade or business of the employer. and was likewise issued a license and authority to operate by the National Telecommunications Commission. respondents filed a Complaint for Recognition of Regular Employment Status. Petitioner filed a motion for reconsideration but CA dismissed it. Also. all labor legislation and all labor contracts shall be construed in favor of the safety and decent living of the laborer. the employment is considered regular. relative to the employer. for various radio programs in the Cebu Broadcasting Station. Respondents did not have the power to bargain for huge talent fees. The test is whether the former is usually necessary or desirable in the usual business or trade of the employer. Jefferson M. talent or celebrity status was required from them because they were merely hired through petitioner’s personnel department just like any ordinary employee. The degree of control and supervision exercised by petitioner over respondents through its supervisors negates the allegation that respondents are independent contractors. In the selection and engagement of respondents. therefore. Service Incentive Pay. whose operations revolve around the broadcast. Catapang. and Lerasan as production assistants (PAs) on different dates. Respondents are highly dependent on the petitioner for continued work. the Court states that the primary standard. It has a franchise as a broadcasting company. regardless of the nature of the activity performed. they were awarded monetary benefits. respondents are entitled to the benefits granted to all other regular employees of petitioner under the CBA . even if the performance is not continuous and merely intermittent. under Article 1702 of the New Civil Code: “In case of doubt. the law deems repeated and continuing need for its performance as sufficient evidence of the necessity if not indispensability of that activity to the business. Besides. The presumption is that when the work done is an integral part of the regular business of the employer and when the worker. The connection can be determined by considering the nature of work performed and its relation to the scheme of the particular business or trade in its entirety. On October 12. It sells and deals in or otherwise utilizes the airtime it generates from its radio and television operations. does not furnish an independent business or professional service. In the case at bar. and declared that they were regular employees of petitioner as such. the employment is considered regular as long as the activity exists. LABOR RELATIONS Atty. Marquez Facts: Petitioner ABS-CBN Broadcasting Corporation (ABS-CBN) is engaged in the broadcasting business and owns a network of television and radio stations. and 13th Month Pay with Damages against the petitioner before the NLRC. respondents cannot be considered as project or program employees because no evidence was presented to show that the duration and scope of the project were determined or specified at the time of their engagement. Holiday Pay. Ruling: The respondents are regular employees of ABS-CBN. petitioner and the ABS-CBN Rank-and-File Employees executed a Collective Bargaining Agreement (CBA) to be effective during the period from December 11. but only with respect to such activity and while such activity exists. Additionally. transmission. Hence.

Francisco vs. Court of Appeals. whether there was an employer-employee relationship. She was also designated as Liason Officer to the City of Manila to secure permits for the operation of the company. to give a clearer picture in determining the existence of an employer-employee relationship based on an analysis of the totality of economic circumstances of the worker. 500 SCRA 690 [2006] Facts: Petitoner was hired by Kasei Corporation during the incorporation stage. NLRC. Thus. It is therefore apparent that petitioner is economically dependent on Respondent Corporation for her continued employment in the latter’s line of business. In 2001. and (2) the underlying economic realities of the activity or relationship. there is no doubt that petitioner is an employee of Kasei Corporation because she was under the direct control and supervision of Seiji Kamura. (2) the extent of the worker’s investment in equipment and facilities. Marquez 10. Kasei Corporation reduced her salary to P2. (3) the nature and degree of control exercised by the employer.500 per month which was until September. courts have relied on the so-called right of control test where the person for whom the services are performed reserves a right to control not only the end to be achieved but also the means to be used in reaching such end. (6) the permanency and duration of the relationship between the worker and the employer. LABOR RELATIONS Atty. like the inclusion of the employee in the payrolls. (4) the worker’s opportunity for profit and loss. Ruling: The court held that in this jurisdiction. She was assigned to handle recruitment of all employees and perform management administration functions.In 1996. the court observed the need to consider the existing economic conditions prevailing between the parties. can help in determining the existence of an employer-employee relationship. Jefferson M. The Labor Arbiter found that the petitioner was illegally dismissed. She filed an action for constructive dismissal with the Labor Arbiter. judgment or foresight required for the success of the claimed independent enterprise. She asked for her salary but was informed that she was no longer connected to the company. skill. She was selected and engaged by the company for compensation. In Sevilla v. She did not anymore report to work since she was not paid for her salary. in addition to the standard of right-of-control like the inclusion of the employee in the payrolls. Petitioner was designated as Acting Manager. the existing economic conditions prevailing between the parties. the corporation’s Technical Consultant. she was replaced by Liza Fuentes as Manager. In addition to the standard of right-of-control. there has been no uniform test to determine the existence of an employer-employee relation. The proper standard of economic dependence is whether the worker is dependent on the alleged employer for his continued employment in that line of business. such as: (1) the extent to which the services performed are an integral part of the employer’s business. (5) the amount of initiative. NLRC affirmed the decision while CA reversed it. the determination of the relationship between employer and employee depends upon the circumstances of the whole economic activity. The better approach would therefore be to adopt a two-tiered test involving: (1) the putative employer’s power to control the employee with respect to the means and methods by which the work is to be accomplished. and is economically dependent upon respondent for her continued employment in that line of business. The following issue is to be discussed. Generally. Her main job function involved accounting and tax services rendered to Page 9 . and (7) the degree of dependency of the worker upon the employer for his continued employment in that line of business. By applying the control test. She was designated as accountant and corporate secretary and was assigned to handle all the accounting needs of the company. There can be no other conclusion that petitioner is an employee of respondent Kasei Corporation.

2007 Facts: Page 10 . post partum. LABOR RELATIONS Atty. Coca-Cola Bottlers Phils. Estrada as a member of its medical staff. vs. 142625.m. Estrada at his home. Estrada with apparent authority thereby leading the Spouses Nogales to believe that Dr. Estrada."In the instant case. At the time of Corazon's admission at CMC and during her delivery. a hospital is not liable for the negligence of an independent contractor-physician. the Court finds no single evidence pointing to CMC's exercise of control over Dr. The Court also believes that a determination of the extent of liability of the other respondents is inevitable to finally and completely dispose of the present controversy. there is no basis to hold Nurse Dumlao liable for negligence.m. G. 2006 Facts: Pregnant with her fourth child.. While Corazon was on her last trimester of pregnancy. It is undisputed that throughout Corazon's pregnancy. she was under the exclusive prenatal care of Dr. In general. G. with the power to dismiss her for cause.R. on the other hand. on the ascertainment of the relationship between Dr. There was no showing that CMC had a part in diagnosing Corazon's condition. 11. al. Marquez Respondent Corporation on a regular basis over an indefinite period of engagement. which is a dangerous complication of pregnancy. Dr. CMC cannot now repudiate such authority. 146881. After a thorough examination of the voluminous records of this case. Dr. February 15.R. CMC clothed Dr. Estrada noted an increase in her blood pressure and development of leg edema indicating preeclampsia. Estrada. Dr. No. assisted by Dr. Climaco. This exception is also known as the "doctrine of apparent authority. it was Dr. Estrada was an employee or agent of CMC. which CMC considered an emergency. Through CMC's acts. but an independent contractor.. Therefore. Estrada's order. Considering these circumstances. Respondent Corporation hired and engaged petitioner for compensation. Espinola's efforts. Oscar Estrada. Estrada and CMC. who attended to Corazon. While Dr. No. who was fetched from his residence by an ambulance. there is no evidence of Nurse Dumlao's alleged failure to follow Dr. No evidence linking Corazon's death and the alleged wrongful hemacel administration was introduced. Nogales et.. who was then 37 years old. Corazon Nogales. He examined the patient and ordered some resuscitative measures to be administered. There is. was under the exclusive prenatal care of Dr. Estrada enjoyed staff privileges at CMC. In the present case. CMC impliedly held out Dr. Villaflor. Estrada's treatment and management of Corazon's condition. Estrada's specific instructions. CMC merely allowed Dr. Jefferson M. The cause of death was "hemorrhage. Corazon started to experience mild labor pains prompting Corazon and Rogelio Nogales ("Spouses Nogales") to see Dr. Estrada. Espinola. Despite Dr. Estrada advised her immediate admission to the Capitol Medical Center ("CMC"). an exception to this principle. however. The hospital may be liable if the physician is the "ostensible" agent of the hospital. December 19. Due to the inclement weather then. 12. Dr. Ruling: The resolution of this issue rests. arrived at the CMC about an hour later or at 9:00 a. More importantly. The question now is whether CMC is automatically exempt from liability considering that Dr. Respondent Corporation had the power to control petitioner with the means and methods by which the work is to be accomplished. Capitol Medical Center et al. Corazon died at 9:15 a. Around midnight of 25 May 1976. Estrada is not an employee of CMC. After examining Corazon. Even assuming Nurse Dumlao defied Dr. Oscar Estrada. Dr. such fact alone did not make him an employee of CMC. Estrada is an independent contractor-physician. there is no showing that side-drip administration of hemacel proximately caused Corazon's death." Issue in this case is whether CMC is vicariously liable for the negligence of Dr. The Court finds respondent CMC vicariously liable for the negligence of Dr. vs. Estrada to use its facilities when Corazon was about to give birth.

In fact. Dean N. he is not at all further required to just sit around in the premises and wait for an emergency to occur so as to enable him from using such hours for his own benefit and advantage. which began on January 1. there is no basis for the moral and exemplary damages granted by the Court of Appeals to respondent due to his alleged illegal dismissal. It did not. Climaco inquired from the management of the company whether it was agreeable to recognizing him as a regular employee. More often than not. Considering that there is no employer-employee relationship between the parties. that the daily incoming and outgoing telegraphic transfer of funds received and relayed by her. (2) the payment of wages. The…Comprehensive Medical Plan. However. National Labor Relations Commission “…It is admitted that FEBTC issued a job description which detailed her functions as a radio/telex operator.” Through the Comprehensive Medical Plan..g. Marquez Dr. respondent filed a Complaint before the NLRC. tell Neri how the radio/telex machine should be operated. LABOR RELATIONS Atty. Petitioner Company did not wield the sole power of dismissal or termination. The last one expired on December 31. e. Despite the non-renewal of the Retainer Agreement. the allegation of complainant that since he is on call at anytime of the day and night makes him a regular employee is off-tangent. complainant maintains his own private clinic attending to his private practice in the city. The management refused to do so. in determining the existence of an employer-employee relationship. 1988. tallies with that of the register. Likewise. a cursory reading of the job description shows that what was sought to be controlled by FEBTC was actually the end result of the task. does not constitute illegal dismissal of respondent. Page 11 . respondent received a letter dated March 9. Hence. seeking recognition as a regular employee of the company and prayed for the payment of all benefits of a regular employee. or how to diagnose and treat his patients. The Retainership Agreement granted to both parties the power to terminate their relationship upon giving a 30-day notice. Ruling: The Court." considered to be the most important element.and if it is an employee of respondent company who is attended to by him for special treatment that needs hospitalization or operation. this is subject to a special billing. the termination of the Retainership Agreement. however. was renewed annually. The guidelines were laid down merely to ensure that the desired end result was achieved. Issue: Whether or not there exists an employer-employee relationship. has invariably adhered to the four-fold test: (1) the selection and engagement of the employee." Neri v. 1994. by virtue of a Retainer Agreement. Inc. or the so-called "control test. respondent continued to perform his functions as company doctor to Coca-Cola until he received a letter dated March 9. employees of [petitioner] company. 1995 from Petitioner Company concluding their retainership agreement effective thirty (30) days from receipt thereof. provided guidelines merely to ensure that the end result was achieved. Complainant does not dispute the fact that outside of the two (2) hours that he is required to be at respondent company’s premises. 1995 from the company concluding their retainership agreement effective 30 days from receipt thereof. but did not control the means and methods by which respondent performed his assigned tasks. and (4) the power to control the employee’s conduct. (3) the power of dismissal. in each case. Such is not the prevailing situation here. The…company lacked the power of control over the performance by respondent of his duties. 1993. which is in accordance with the provisions of the Agreement. No employer-employee relationship exists between the parties. an employee is required to stay in the employer’s workplace or proximately close thereto that he cannot utilize his time effectively and gainfully for his own purpose. respectively. Bacolod City. Dr. On February 24. Consequently. The Retainer Agreement. bills them accordingly -. how to immunize. Jefferson M. does not tell respondent "how to conduct his physical examination.. which contains the respondent’s objectives. where he services his patients. While the complaint was pending before the Labor Arbiter. duties and obligations. Climaco is a medical doctor who was hired by Coca-Cola Bottlers Phils.

respondents’ employment with petitioner passed the "four-fold test" on employer-employee relations. a radio station owned and operated by petitioner Consolidated Broadcasting System. This was not complied with by the petitioner. Some of them were employed by petitioner since 1974. but was opposed by respondents. They reported for work daily for six days in a week and were required to record their drama production in advance. an inspection of DWYB station. 168424. and (4) the power to control the employee. After the negotiations failed. the employer has the burden of proving that the dismissal was for a just cause. we find that respondents were illegally dismissed. Furthermore. petitioner is obliged to execute the necessary contract specifying the nature of the work to be performed. being in possession of the records. while the latest one was hired in 1997. Consolidated Broadcasting System vs. 1999.Note that under Policy Instruction No. No. It is a time-honored rule that in controversies between a laborer and his master. Ruling: 1. Whether respondents were employees of petitioner. If petitioner did not hire respondents and if it was the director alone who chose the talents. thus. Inc. the scales of justice must be tilted in favor of the latter -the employer must affirmatively show rationally adequate evidence that the dismissal was for a justifiable cause. In this case. the former claimed constructive dismissal. In labor cases. 40. on February 3. rates of pay. Petitioner contended that respondents are not its employees and refused to submit the payroll and daily time records despite the subpoena duces tecum issued by the DOLE Regional Director. LABOR RELATIONS Atty. Vexed by the respondents' complaint. Their drama programs were aired not only in Bacolod City but also in the sister stations of DYWB in the Visayas and Mindanao areas. The results thereof revealed that petitioner is guilty of violation of labor standard laws. project or contractual employees are required to be apprised of the project they will undertake under a written contract. petitioner merely relied on its contention that respondents were piece rate contractors who were paid by results. illegal. Petitioner failed to controvert with substantial evidence the allegation of respondents that they were hired by the former on various dates from 1974 to 1997. (3) the power to dismiss. Eventually. The test to determine whether employment is regular or not is the reasonable connection between the particular activity performed by the employee in relation to the usual business or trade of the employer. pending the outcome of the inspection case with the Regional Director. which on November 12. Issues: 1. Jefferson M. 2007 Facts: Respondents alleged that they were employed as drama talents by DYWB-Bombo Radyo. However. June 8. 2. petitioner merely contended that it was respondents who ceased to report to work. Moreover. the latter sought the intervention of the Department of Labor and Employment (DOLE). undoubtedly show that their work is necessary and indispensable to the usual business or trade of petitioner. (2) the payment of wages. therefore. Sometime in August 1998. 1998. 2. petitioner could have easily shown. justifying the reasonable conclusion that no such contracts exist and that respondents were in fact regular employees. Yes. Oberio. and never presented any substantial evidence to support said allegation. petitioner reduced the number of its drama productions from 14 to 11.R. the engagement of respondents for a period ranging from 2 to 25 years and the fact that their drama programs were aired not only in Bacolod City but also in the sister stations of DYWB in the Visayas and Mindanao areas. a contract to such effect. G. Petitioner further argued that the case should be referred to the NLRC because the Regional Director has no jurisdiction over the determination of the existence of employer-employee relationship which involves evidentiary matters that are not verifiable in the normal course of inspection. petitioner allegedly pressured and intimidated respondents. if doubts exist between the evidence presented by the employer and the employee. Respondents Oberio and Delta were suspended for minor lapses and the payment of their salaries were purportedly delayed. or the power to hire. doubts reasonably arising from the evidence should be resolved in the former's Page 12 . Whether respondents’ dismissal was illegal. namely: (1) the selection and engagement of the employee. Marquez 13. respondents were barred by petitioner from reporting for work. conducted through its Regional Office. Finally. failure to show this would necessarily mean that the dismissal was unjustified and. and the programs in which they will work. Moreover.

Aside from control. The practice of having fixed-term contracts in the industry does not automatically make all talent contracts valid and compliant with labor law. No. ABC also had power to dismiss her. there was an illegal dismissal. Jose Javier. ABC had control over the performance of petitioner’s work. an early evening news program. All these being present. the television station did not exercise control over the means and methods of the performance of Sonza’s work. 164652. NLRC reversed. Ruling: Thelma Dumpit-Murillo was a regular employee under contemplation of law.R. petitioner stopped reporting for work. Concerning regular employment. Page 13 . In Sonza. 2007. The contract was for a period of three months. The duties of petitioner as enumerated in her employment contract indicate that ABC had control over the work of petitioner. payment of 13th month pay. The Labor Arbiter dismissed the complaint for illegal constructive dismissal. demanding reinstatement. Since private respondents did not observe due process in constructively dismissing the petitioner. In the case at bar. This repeated engagement under contract of hire is indicative of the necessity and desirability of the petitioner’s work in private respondent ABC’s business. Issue: Whether or not Murillo is an employee of Associated Broadcasting Company. Marquez favor. but that the other claims of petitioner had no basis in fact or in law. The policy is to extend the doctrine to a greater number of employees who can avail of the benefits under the law. She sent a demand letter to ABC. petitioner’s talent contract expired. vacation/sick/service incentive leaves and other monetary benefits due to a regular employee. is the comparatively low P28. informing the latter that she was still interested in renewing her contract subject to a salary increase. Further. CA. ABC also dictated the work assignments and payment of petitioner’s wages. which is in consonance with the avowed policy of the State to give maximum aid and protection of labor.000 a month salary of Sonza. Noteworthy too. petitioner is entitled to security of tenure and can be dismissed only for just cause and after due compliance with procedural due process. as a pre-condition for its enfranchisement. The assertion that a talent contract exists does not necessarily prevent a regular employment status. LABOR RELATIONS Atty. citing 2004 Sonza Facts: Associated Broadcasting Company (ABC) hired Thelma Dumpit-Murillo under a talent contract as a newscaster and co-anchor for Balitang- Balita. payment of unpaid wages and full backwages. there existed an employment relationship between petitioner and ABC. 14. petitioner sent a letter to Mr. the requisites for regularity of employment have been met in the instant case. Petitioner’s work was necessary or desirable in the usual business or trade of the employer which includes. After four years of repeated renewals. G. her work was continuous for a period of four years. its participation in the government’s news and public information dissemination. ABC replied that a check covering petitioner’s talent fees had been processed and prepared. the Sonza case is not applicable.000 monthly pay of petitioner vis the P300. June 8. Vice President for News and Public Affairs of ABC. Thereafter. Two weeks after the expiration of the last contract. In addition. Dumpit-Morillo vs. clearly. As a regular employee. Jefferson M. that all the more bolsters the conclusion that petitioner was not in the same situation as Sonza.

The principle of estoppel in pais applies wherein -. Lamadrid Bearing and Parts Corp. Sept. Jefferson M. it is true that the words "EMPLOYEE'S NAME" appear printed below petitioner's name. In a subsequent letter dated February 25. 1995. representations or admissions. an employer-employee relationship exists where the person for whom the services are performed reserves the right to control not only the end achieved. 1995. be allowed to later disown the same through her allegation that she was an employee of the respondents when the said agreement was terminated by reason of her violation of the terms and conditions thereof. that he and the other "contractors" of Bodega City such as the singers and band performers. 1995. In a letter signed by Yap dated February 10. Petitioner is likewise estopped from denying the existence of the subject concessionaire agreement. (2) the payment of wages. Issue: Whether or not employer-employee relationship exists Ruling: The Court applies the four-fold test expounded in Abante v. (3) the presence or absence of the power of dismissal. she failed to dispute respondents' evidence consisting of Habitan's testimony. This is not the situation in the present case…As to the ID card. this was imposed upon petitioner as part of the terms and conditions in the concessionaire agreement. National Labor Relations Commission. Lopez vs. 1995.to wit: To ascertain the existence of an employer-employee relationship. However. LABOR RELATIONS Atty. Under the control test.by one's acts. Bodega City. so as to be prejudiced if the former is permitted to deny the existence of those facts. this Court held that the complainant's ID card and the cash vouchers covering his salaries for the months indicated therein were substantial evidence that he was an employee of respondents. wherein petitioner was seen to have acted in a hostile manner against a lady customer of Bodega City who informed the management that she saw petitioner sleeping while on duty. 3.. Of these four. 155731. jurisprudence has invariably applied the four-fold test. However. The so-called "control test" is commonly regarded as the most crucial and determinative indicator of the presence or absence of an employer-employee relationship. citing 2004 Abante & 2005 Consulta Facts: Petitioner was the "lady keeper" of Bodega City tasked with manning its ladies' comfort room. and (4) the presence or absence of the power of control. induces another to believe certain facts to exist and to rightfully rely and act on such belief. after enjoying the benefits of the concessionaire agreement with respondents.intentionally or through culpable negligence. the last one is the most important. G. In Domasig v. It is true that petitioner was required to follow rules and regulations prescribing appropriate conduct while within the premises of Bodega City.R. Petitioner insists that her ID card is sufficient proof of her employment. Marquez 15. 2007. but also the manner and means to be used in reaching that end. petitioner was made to explain why the concessionaire agreement between her and respondents should not be terminated or suspended in view of an incident that happened on February 3. or silence when one ought to speak out -. She should not. Page 14 . were also issued the same ID cards for the purpose of enabling them to enter the premises of Bodega City. especially in light of the fact that the latter failed to deny said evidence. No. Petitioner failed to cite a single instance to prove that she was subject to the control of respondents insofar as the manner in which she should perform her job as a "lady keeper" was concerned. namely: (1) the manner of selection and engagement. respondents had decided to terminate the concessionaire agreement between them. Yap informed petitioner that because of the incident that happened on February 3.

NLRC et al. Meluz Trinidad (Dr. Calamba Medical Center vs. you are hereby terminated for cause from employment effective today. going back to the element of control. In the meantime. 16. 1998. In fact. 1998 return-to-work Order to the striking union officers and employees of petitioner pending resolution of the labor dispute. through an extension telephone line. Lanzanas a Memorandum of March 7. Nov. Desipeda whose attention was called to the above-said telephone conversation issued to Dr. as shown by the letter of Yap to her dated February 15. Merceditha) in March 1992 and August 1995. Moreover. LABOR RELATIONS Atty. 1998. G. also a resident physician at the hospital. the last paragraph of the concessionaire agreement even allowed petitioner to engage persons to work with or assist her in the discharge of her functions. April 25. Instead. Lastly. you still did not report for work despite memorandum issued by the CMC Medical Director implementing the Labor Secretary's ORDER…You are likewise aware that you were observed (re: signatories [sic] to the Saligang Batas of BMCMC-UWP) to be unlawfully participating as member in the rank-and-file union's concerted activities despite knowledge that your position in the hospital is managerial in nature (Nurses. and staff of the Emergency Room carry out your orders using your independent judgment) which participation is expressly prohibited by the New Labor Code… For these reasons as grounds for termination. Diosdado Miscala. respectively.. Jefferson M. No. Neither did respondents determine the means and methods by which petitioner could ensure the satisfaction of respondent company's customers.R. Apparently. without prejudice to further action for revocation of your license before the Philippine [sic] Regulations [sic] Commission. petitioner was not dismissed by respondents. The fact that she was expected to maintain the cleanliness of respondent company's ladies' comfort room during Bodega City's operating hours does not indicate that her performance of her job was subject to the control of respondents as to make her an employee of the latter. indicating as grounds therefor his failure to report back to work despite the DOLE order and his supposed role in the striking union. which was to give assistance to the users of the ladies' comfort room. Lanzanas a notice of termination which he received on April 25. thus: On April 23. 176484. 2008 Facts: The Calamba Medical Center (petitioner). Marquez Hence. Petitioner later sent Dr. There is nothing in the agreement which specifies the methods by which petitioner should achieve these results. Issue: Whether or not employer-employee relationship exists Page 15 . Dr. Lanzanas with a fellow employee. Dr. engaged the services of medical doctors-spouses Ronaldo Lanzanas (Dr. the concessionaire agreement merely stated that petitioner shall maintain the cleanliness of the ladies' comfort room and observe courtesy guidelines that would help her obtain the results they wanted to achieve. Orderlies. It has been established that there has been no employer-employee relationship between respondents and petitioner. as part of its team of resident physicians. Respondents did not indicate the manner in which she should go about in maintaining the cleanliness of the ladies' comfort room. the Court finds that the elements of selection and engagement as well as the power of dismissal are not present in the instant case. 1998. Instead. 1995. inadvertently overheard a telephone conversation of respondent Dr. which was in accordance with the provisions of the agreement in case of violation of its terms and conditions. Dr. On March 7. petitioner was not subjected to definite hours or conditions of work. their contractual relationship was terminated by reason of respondents' termination of the subject concessionaire agreement. Lanzanas thus amended his original complaint to include illegal dismissal. 25. Cresenciano Trajano of the Department of Labor and Employment (DOLE) certified the labor dispute to the NLRC for compulsory arbitration and issued on April 21. the requirement that she had to render her services while Bodega City was open for business was dictated simply by the very nature of her undertaking. Their contractual relationship was governed by the concessionaire agreement embodied in the 1992 letter. a privately-owned hospital. 1998. Lanzanas) and Merceditha Lanzanas (Dr. then Sec. Thus. 1998. Dr. Trinidad). Lanzanas and Miscala were discussing the low "census" or admission of patients to the hospital.

G. night shift differential and 13th month Page 16 . LABOR RELATIONS Atty. however. task. it is not essential for the employer to actually supervise the performance of duties of the employee. Dr. and the classification as "salary" of their remuneration. or any department or ward for that matter. Escasinas et al. For control test to apply." an employment relationship exists between a physician and a hospital if the hospital controls both the means and the details of the process by which the physician is to accomplish his task. which the petitioner [the union] is seeking to represent in the instant case. With respect to respondents' sharing in some hospital fees.R. vs. under Section 15. In late 2002. Jessica Joyce R. non-payment of holiday pay. unless there is a training agreement between them. their job is merely routinary in nature and consequently. They were considered non-training general practitioners. petitioner never proferred any valid cause for her dismissal except its view that "her marriage to [Dr. respondents' work is monitored through its nursing supervisors. They are not therefore barred from membership in the union of rank[-]and[-]file. Turning now to the issue of dismissal. Shangri-las Mactan Island Resort et al." 17. thus: …whether fixed or ascertained on a time. an employer-employee relationship exists between the resident physicians and the training hospitals. Jefferson M. they cannot be considered supervisory employees.. Merceditha. Participation in a strike and intransigence to a return-to-work order must. no operations can be undertaken in those areas. this scheme does not sever the employment tie between them and petitioner as this merely mirrors additional form or another form of compensation or incentive similar to what commission-based employees receive as contemplated in Article 97 (f) of the Labor Code. Lanzanas] has given rise to the presumption that her sympath[y] [is] with her husband. and the training program is duly accredited or approved by the appropriate government agency. Pepito (respondent doctor) to work in her clinic at respondent Shangri-la’s Mactan Island Resort (Shangri-la) in Cebu of which she was a retained physician. Escasinas and Evan Rigor Singco (petitioners) were engaged in 1999 and 1996. namely. which consisted of 24-hour shifts totaling forty-eight hours each week and which were strictly to be observed under pain of administrative sanctions. underpayment of wages. petitioner itself provided incontrovertible proof of the employment status of respondents. petitioners filed with the National Labor Relations Commission (NLRC) Regional Arbitration Branch No. In fact. as determined by petitioner through its medical director. Finally. Lanzanas was neither a managerial nor supervisory employee but part of the rank-and-file. or other method of calculating the same… Respondents were in fact made subject to petitioner-hospital's Code of Ethics. they were not undergoing any specialization training. respectively. piece. the employer (CMC) alleged that 24 members of petitioner are supervisors. it having been effected without any just or authorized cause and without observance of due process. It bears noting at this juncture that mandatory coverage under the SSS Law is premised on the existence of an employer-employee relationship. her dismissal was worse. except in cases of compulsory coverage of the self-employed. they do not however recommend any managerial action. private respondents maintained specific work- schedules. 2009 Facts: Registered nurses Jeromie D. charge nurses and orderlies. Without the approval or consent of petitioner or its medical director. the provisions of which cover administrative and disciplinary measures on negligence of duties. More importantly. Lanzanas] declared that he was going to boycott the scheduling of their workload by the medical doctor. the operating room. it being enough that it has the right to wield the power.. the Court upholds the appellate court's conclusion that private respondents were illegally dismissed. assigned at the emergency rooms and ward sections. the identification cards it issued them. 178827. namely Rolando Lanzonas. This is the import of the Secretary of Labor's Resolution of May 22. Moreover. 1998 in OS A-05-15-98 which reads: In the motion to dismiss it filed before the Med-Arbiter. VII (NLRC-RAB No.That petitioner exercised control over respondents gains light from the undisputed fact that in the emergency room. Marquez Ruling: YES. As for the case of Dr. March 4. and offenses against persons. or commission basis. Under the "control test. At most. VII) a complaint for regularization. the payslips and BIR W-2 (now 2316) Forms which reflect their status as employees. be duly proved in order to justify immediate dismissal in a "national interest" case. [and that when [Dr. he was presumed to be speaking for himself [and] for his wife Merceditha. No. In respondents' case. personnel conduct and behavior. Mere membership in a labor union does not ipso facto mean participation in a strike. it enrolled respondents in the SSS and Medicare (Philhealth) program. Rule X of Book III of the Implementing Rules of the Labor Code. by Dr. A close scrutiny of the job descriptions of the alleged supervisors narrated by the employer only proves that except for the contention that these employees allegedly supervise. property and the hospital's interest. As priorly stated.

Emergency medical and dental services. i. and that she maintained petitioners’ services upon their request. This set-up is precisely true in the case of an independent contractorship as well as in an agency agreement. on the correct interpretation of Art. Issue: Whether or not employer-employee relationship exists Ruling: The resolution of the case hinges. is mandated to "furnish" its employees with the services of a full-time registered nurse. Thus. As to whether respondent doctor can be considered a legitimate independent contractor. Article 280 of the Labor Code. a part-time physician who needed to stay in the premises of the non-hazardous workplace for two (2) hours. nothing is there in the law which says that medical practitioners so engaged be actually hired as employees. that petitioners were not its employees but of respondent doctor whom it retained via Memorandum of Agreement (MOA) pursuant to Article 157 of the Labor Code. and Under the foregoing provision. not employ. quoted by the appellate court. Art. claiming that they are regular employees of Shangri-la. when the number of employees exceeds two hundred (200) but not more than three hundred (300). and an emergency clinic which means that it should provide or make available such medical and allied services to its employees. even without being hired as an employee. LABOR RELATIONS Atty. as amended. as written. De Vera: x x x while it is true that the provision requires employers to engage the services of medical practitioners in certain establishments depending on the number of their employees. As held in Philippine Global Communications vs. illuminate: Sec. 8. Marquez pay differential against respondents. Shangri-la. for Article 157 must not be read alongside Art. a part-time physician and dentist.e. and an emergency clinic. the pertinent sections of DOLE Department Order No. The term "full-time" in Art. So De Vera teaches: x x x For. only requires the employer "to retain". series of 1997. Job contracting. contrary to petitioners’ postulation. Jefferson M. As it is. regular and casual. – It shall be the duty of every employer to furnish his employees in any locality with free medical and dental attendance and facilities consisting of: (b) The services of a full-time registered nurse. not the manner of his engagement. 10. – There is job contracting permissible under the Code if the following conditions are met: (1) The contractor carries on an independent business and undertakes the contract work on his own account under his own responsibility Page 17 .. as amended. 157 does not require the engagement of full-time nurses as regular employees of a company employing not less than 50 workers. x x x The phrase "services of a full-time registered nurse" should thus be taken to refer to the kind of services that the nurse will render in the company’s premises and to its employees. is not the yardstick for determining the existence of an employment relationship. The Court holds that. adding that the law. 280 and the provisions on permissible job contracting of the Labor Code. 280 in order to vest employer-employee relationship on the employer and the person so engaged. Respondent doctor for her part claimed that petitioners were already working for the previous retained physicians of Shangri-la before she was retained by Shangri-la. which employs more than 200 workers. no matter how necessary for the latter’s business. a part-time physician and dentist. 157 cannot be construed as referring to the type of employment of the person engaged to provide the services. we take it that any agreement may provide that one party shall render services for and in behalf of another. however. in the main. Shangri-la claimed. the Article provides: ART. 157 vis a vis Art. the provision merely distinguishes between two (2) kinds of employees. Indeed. 157. not necessarily to hire or employ a service provider.

administrative in nature. the duty to supply the premises. at most. (3) the payment of wages by whatever means.000. Lotlot Dagat. No 167622. and (4) the power to control the worker's conduct. 18. Tongko v. appliances. governs how they perform their respective tasks and responsibilities. as Shangri-la does not control how the work should be performed by petitioners. (b) Labor-only contracting as defined herein is hereby prohibited and the person acting as contractor shall be considered merely as an agent or intermediary of the employer who shall be responsible to the workers in the same manner and extent as if the latter were directly employed by him… The existence of an independent and permissible contractor relationship is generally established by considering the following determinants: whether the contractor is carrying on an independent business. related as it is to safety matters. work premises and other materials. 9. The letter addressed to respondent doctor dated February 7. considering that Shangri-la and respondent doctor share in the guests’ payments for medical services rendered. firing and payment of the contractor's workers. That Shangri-la provides the clinic premises and medical supplies for use of its employees and guests do not necessarily prove that respondent doctor lacks substantial capital and investment. the various office directives issued by Shangri-la’s officers do not imply that it is Shangri-la’s management and not respondent doctor who exercises control over them or that Shangri-la has control over how the doctor and the nurses perform their work. machineries. as well as value added taxes and withholding taxes. forbidding the clinic from receiving cash payments from the resort’s guests is a matter of financial policy in order to ensure proper sharing of the proceeds. and the mode. It is thus presumed that said document. while the letter dated May 17.. with the latter assuming primacy in the overall consideration. materials and labor. the control of the premises. 2011 Facts: Page 18 . free from the control and direction of his employer or principal in all matters connected with the performance of the work except as to the results thereof. Marquez according to his own manner and method. which are not directly related to Shangri-la’s principal business – operation of hotels and restaurants. Labor-only contracting. the nature and extent of the work. equipment. G. LABOR RELATIONS Atty. On the other hand. 2004 from Shangri-la’s Assistant Financial Controller. – (a) Any person who undertakes to supply workers to an employer shall be deemed to be engaged in labor-only contracting where such person: (1) Does not have substantial capital or investment in the form of tools. et al. In fine. group life. group personal accident insurance and life/death insurance for the staff with minimum benefit payable at 12 times the employee’s last drawn salary. Besides. pay their SSS premium as well as their wages if they were not indeed her employees. "Clinic Policies and Employee Manual" claimed to have been prepared by respondent doctor exists. Jefferson M. Reyes giving instructions regarding the replenishment of emergency kits is. (2) power of dismissal. the term and duration of the relationship. the employer's power with respect to the hiring. equipment.R. respondent doctor is the one who underwrites the following: salaries. machineries. With respect to the supervision and control of the nurses and clinic staff. 2003 from a certain Tata L. tools. and (2) The contractor has substantial capital or investment in the form of tools. manner and terms of payment. sourced from her P60. Against the above-listed determinants. 157. and not the employee manual being followed by Shangri-la’s regular workers. work premises. As to payment of wages. it is not petitioners’ employer. and (2) The workers recruited and placed by such persons are performing activities which are directly related to the principal business or operations of the employer in which workers are habitually employed. It is unlikely that respondent doctor would report petitioners as workers. Contrary to petitioners’ contention. the skill required. and other materials which are necessary in the conduct of his business. Sec.. the maintenance of a clinic and provision of medical services to its employees is required under Art.00 monthly retainer fee and 70% share of the service charges from Shangri-la’s guests who avail of the clinic services. existence of an employer. SSS contributions and other benefits of the staff. January 25. Manufacturer Life Insurance Co. the right to assign the performance of a specified piece of work. the Court holds that respondent doctor is a legitimate independent contractor. to which petitioners gave their conformity and in which they acknowledged their co-terminus employment status. (MANULIFE) Inc.employee relationship is established by the presence of the following determinants: (1) the selection and engagement of the workers. the control and supervision of the work to another. it is not disputed that a document.

He alleged the existence of an employment relationship. He was tasked with numerous administrative functions and supervisory authority over Manulife’s employees. sufficient to characterize him as an employee. In 1996. SC Ruling: Rules regarding the desired results (e. LABOR RELATIONS Atty. where he earned commissions. On the other hand. Since the beginning. dated December 18. his tasks were to canvass for applications for insurance products and collect money due to the Company. terminating his services. the required volume to continue to qualify as a company agent & legal/ ethical rules to be followed) are built-in elements of control specific to an insurance agency and should not and cannot be read as elements of control that attend an employment Page 19 . Manulife instituted manpower development programs which directed the managers to increase the number of agents to at least 1. Issue: Whether or not there exists an employer-employee relationship. initially an insurance agent of Manulife who was promoted to the role of a manager. NLRC: It found the existence of an employer-employee relationship. Tongko consistently declared himself self-employed in his income tax returns. Hence. Decisions of the Judicial Tribunals LA: No employer-employee relationship existed between the parties. 1977under a Career Agent’s Agreement which regarded him as an independent contractor.. 2001. He was required to follow at least three codes of conduct. Marquez Tongko was. not an employee. SC: In reversing the CA ruling. Tongko became a Regional Sales Manager. Subsequently. he was paid an annual over-rider. Also. The contractual relationship between Tongko and Manulife had two basic phases.g. he became a Branch Manager. Manulife had the power of control over Tongko. Tongko then filed an illegal dismissal complaint with the NLRC Arbitration Branch. Tongko was tasked to recruit some agents in addition to his other administrative functions. In 1990. there exists the possibility of an insurance agent becoming an employee of an insurance company if evidence shows that the company promulgated rules or regulations that effectively controlled or restricted an insurance agent’s choice of methods or the methods themselves in selling insurance. Tongko received another letter. as shown by the fact that he complied with 3 different codes of conduct and that he performed administrative duties. a Motion for Reconsideration was filed by Manulife and was granted by the SC. in 2001. Jefferson M. Manulife contended that what existed between them was a mere agency relationship. First. The second phase started in 1983 when Tongko was named Unit Manager.000 strong for a start. CA: It reverted to the labor arbiter’s decision that no employer-employee relationship existed between them. The initial phase began on July 1. persistency income and management overrides. It was found that Tongko’s region was the lowest performer in terms of recruiting in 2000. As an agent. However. There was illegal dismissal. In support of this he asserted that as Unit Manager. Second. it declared that an employment relationship existed between them. a travel and entertainment allowance in addition to his overriding commissions.

over Tongko during his ascent in Manulife’s sales ladder. Hence. as a ground for termination of Tongko’s agency. Secondly. not indicative of control Page 20 . is a matter that the labor tribunals cannot rule upon in the absence of an employer-employee relationship. agency and contracts. and Regional Sales Manager in 1996. The concept of estoppel – a legal and equitable concept – necessarily must come into play. they must have the nature of dictating the means or methods to be employed in attaining the result. evidence shows that Tongko’s role as an insurance agent never changed during his relationship with Manulife. For this reason. In this case. as against his belated claim that he was all along an employee. are too diametrically opposed to be simply dismissed or ignored. Based on decided cases. Tongko perhaps could be labeled as a "lead agent" who guided under his wing other Manulife agents. Marquez relationship governed by the Labor Code. Branch Manager in 1990. an agency relationship prevails in the insurance industry for the purpose of selling insurance. should not merely relate to the mutually desirable result intended by the contractual relationship. Jefferson M. In addition. which is absent in the case at bar. The directive of De Dios to Tongko (in increasing the number of agents) was merely suggestive. but also in guiding the agents under his wing. LABOR RELATIONS Atty. the failure of Tongko to comply with the guidelines & directives of Manulife is recruiting more agents. the SC is telling us that. or of fixing the methodology and of binding or restricting the party hired to the use of these means. we can take judicial notice that as a matter of Insurance Code-based business practice. There was." based on the case of Insular Life. Tongko essentially remained an agent. SC: Tongko is just an AGENT. no formal contract regarding these undertakings appears in the records of the case. Evidence indicates that Tongko consistently clung to the view that he was an independent agent since he invariably declared himself a business or self-employed person in his income tax returns. prior to the directives sent by De Dios. indicative of control when it merely controls the desired results and not the means and the manner by which agents are to conduct their sales. but moved up in this role through Manulife’s recognition that he could use other agents approved by Manulife but operating under his guidance. For want of a better term. could have at the very least provided the bases for properly ascertaining the juridical relationship established between the parties. The codes of conduct do not intrude into the insurance agents’ means and manner of conducting their sales and only control them as to the desired results. first. In effect. adherence to a code of conduct is not. there must be an evidence of a contract that shows that the relationship has been converted from contract of agency to that of employment. while Tongko was later on designated unit manager in 1983. Any such contract or agreement. Jurisdiction over the matter belongs to the courts applying the laws of insurance. Significantly. per se. Tongko’s previous admissions in several years of tax returns as an independent agent. Guidelines indicative of labor law "control. the mere presentation of codes or of rules and regulations is not per se indicative of labor law control. indeed. lack of evidence on record showing that Manulife ever exercised means-and-manner control. Manulife had practically left Tongko alone not only in doing the business of selling insurance. a determination of the presence of the Labor Code element of control was made on the basis of the stipulations of the subsequent contracts. even to a limited extent. The reality is. had there been any. Hence.

Jr. the suspension dragged on for years because of petitioners’ stubborn refusal to pay. He had to put a stop to it as he also relied on these boundary payments to raise the full amount of his monthly amortizations on the jeepneys. including the prerogative to instill discipline on his employees and to impose penalties.ph/jurisprudence/2011/january2011/179428. Issue: Whether or not the policy of suspending drivers pending payment of arrears in their boundary obligations is reasonable._ftn2 for illegal dismissal against respondent who barred them from driving the vehicles due to deficiencies in their boundary payments. v. when prescribed. The only limitation on the exercise of management prerogative is that the policies. When Page 21 . Caong. (Caong). Then there would have been a clear act of dismissal. Petitioners’ suspension cannot be categorized as dismissal. considering that there was no intent on the part of respondent to sever the employer-employee relationship between him and petitioners. G. petitioners even filed a complaint for illegal dismissal against respondent. and Loriano D. It would have been different if petitioners complied with the condition and respondent still refused to readmit them to work. 2011 Facts: Petitioners Primo E. Alexander J. It is acknowledged that an employer has free rein and enjoys a wide latitude of discretion to regulate all aspects of employment. Respondent’s policy of suspending drivers who fail to remit the full amount of the boundary was fair and reasonable under the circumstances. as drivers of his jeepneys. Respondent explained that he noticed that his drivers were getting lax in remitting their boundary payments and. rules. they filed separate complaintshttp://sc. Begualos. Jefferson M. January 26. and the corresponding penalties. No. Ruling: It is already settled that the relationship between jeepney owners/operators and jeepney drivers under the boundary system is that of employer- employee and not of lessor-lessee. A company policy must be implemented in such manner as will accord social justice and compassion to the employee. In fact. But such was not the case. in fact. Demonstrating their obstinacy. Tresquio (Tresquio). including dismissal. it was made clear that petitioners could put an end to the suspension if they only pay their recent arrears.R. In case of noncompliance with the company policy. if warranted. 179428. the manner in which management conducts its own affairs to achieve its purpose is within the management’s discretion.judiciary.gov. and regulations on work-related activities of the employees must always be fair and reasonable. petitioners. on the days immediately following the implementation of the policy. Jr.htm . Indeed. Caong. upon erring employees. Daluyon (Daluyon) were employed by respondent Avelino Regualos under a boundary agreement. the employer must consider the surrounding circumstances and the reasons why the employee failed to comply. As it was. LABOR RELATIONS Atty. In November 2001. herein petitioners had already incurred a considerable amount of arrears. This is a management prerogative. commensurate to the offense involved and to the degree of the infraction. The fact that the drivers do not receive fixed wages but only get the amount in excess of the so-called “boundary” that they pay to the owner/operator is not sufficient to negate the relationship between them as employer and employee. incurred deficiencies in their boundary remittances. Marquez 19. Instead of paying.

both the Labor Arbiter and NLRC overlooked Article 280 of the Labor Code. As a result.. The respondent is deemed a regular employee of the petitioner after the lapse of one year from his employment. an explanation as to why passengers were scarce at that time. 20. The Resident Manager of the petitioner issued then a Memorandum advising respondent that within 30 days from receipt thereof. August 8. except when occassionally requested by the management to discuss the matters which needs of his expertise as a consultant. filed a complaint with SSS against petitioner’s refusal to cause his registration with the SSS. Jefferson M. The CA opined that. still it was the law that recognized and considered him a regular employee after his first year of rendering service to petitioner. he requested petitioner to cause his registration with the Social Security System but petitioner did not accede to his request considering the former only a retainer/consultant. This kind of arrangement continued on for the next 11 years. Jesus P. Atok Big Wedge Company vs. LABOR RELATIONS Atty. The said article only set the distinction between a casual employee from a regular employee for purposes of determining the rights Page 22 . Petitioner herein posits that CA erred in applying Article 280 of the Labor Code in determining whether there exists an employer-employee relationship. They have also executed a retainer agreement however was misplaced and can no longer be found. vacation pay and sick leave with the NLRC. regular and casual employees. An appeal was made before the NLRC but same was dismissed and affirmed the decision of the Labor Arbiter. the waiver is ineffective. unfair labor practice. Torres. The Court of Appeals annuled and has set aside the decision of NLRC. Since respondent was getting old. petitioners merely alleged that there were only few passengers during the dates in question. G. A petition for review was filed under Rule 65 before the Court of Appeals. VP and Acting Resident Manager. Gison. which distinguishes between the two kinds of employees. In the present case. non-payment of 13th Month pay. Respondent is not required to report to its office on a regular basis. Gison. Such excuse is not acceptable without any proof or. and it appears that only petitioners failed to remit the full boundary payment on said dates. respondent filed a complaint for illegal dismissal. Atok Big Wedge Company thorugh its then Asst. He is paid a retainer fee of 3. As such. 169510. it clearly disregarded the same by repeatedly giving petitioner several tasks to perform.000Php a month and delivered to him either in his residence or in a local restaurant. No. 2011 Facts: The respondent in this case.e. Regional Arbitration Branch and Cordillera Administrative Region against the petitioner. the former assisted the petitioner’s retained legal counsel with matters pertaining to the prosecution of cases against illegal surface occupants within the area covered by the company’s mineral claims. i. Petitioner contends that where the existence of an employer-employee relationship is in dispute. The CA added that although there was an agreement between the parties that the employment of the respondent will be only temporary. petitioner’s services as a retainer/consultant will be terminated since his services are no longer necessary.R. Moreover. then its noncompliance must be excused. Article 280 of the Labor Code is inapplicable. not worthy of belief. although the respondent may have waived his right to attain a regular status when he agreed to perform these tasks on a temporary employment status. Considering also that the respondent had been performing services for the petitioner for the last 11 years entitling him to the rights and privileges of a regular employee. underpayment of wages. He also tasked to perform liason work with government agencies which he said his expertise. at least. We also find the excuse unbelievable considering that petitioners incurred the shortages on separate days. was engaged as part-time consultant of the petitioner. Marquez the circumstances merit the relaxation of the application of the policy. As a consultant on retainer basis. Rutillo A. It is simply a bare allegation. Respondent herein. The Labor Arbiter rendered a decision in favor of the petitioner ruling that there is no employer-employee relationship and dismissed the complaint for lack of merit.

to join or form a union. and (4) the power to control the employee's conduct. for purposes of determining the right of an employee to certain benefits. but petitioner did not control the manner and methods by which respondent performed these tasks. More importantly. Being supported by substantial evidence. an employer-employee relationship is apparently absent in the case at bar. the absence of the element of control on the part of the petitioner engenders a conclusion that he is not an employee of the petitioner. To ascertain the existence of an employer-employee relationship jurisprudence has invariably adhered to the four-fold test." The so-called "control test" is commonly regarded as the most crucial and determinative indicator of the presence or absence of an employer-employee relationship Applying the aforementioned test.. is not applicable in the case at bar. erroneous on the part of the Court of Appeals to rely on Article 280 in determining whether an employer-employee relationship exists between respondent and the petitioner. (2) the payment of wages. respondent was not required to report everyday during regular office hours of petitioner. In fact. such determination should have been accorded great weight by the CA in resolving the issue.e. the termination of respondent's services by the petitioner after due notice did not constitute illegal dismissal warranting his reinstatement and the payment of full backwages. he became a regular employee of the petitioner by continually performing services for the company. Considering that there is no employer-employee relationship between the parties. petitioner did not prescribe the manner in which respondent would accomplish any of the tasks in which his expertise as a liaison officer was needed. Respondent was well aware of the agreement that he was hired merely as a liaison or consultant of the petitioner and he agreed to perform tasks for the petitioner on a temporary employment status only. Marquez of an employee to be entitled to certain benefits. to wit: (1) the selection and engagement of the employee. respondent anchors his claim that he became a regular employee of the petitioner based on his contention that the "temporary" aspect of his job and its "limited" nature could not have lasted for eleven years unless some time during that period. despite the fact that petitioner made use of the services of respondent for eleven years. Page 23 . LABOR RELATIONS Atty. in which the lower court used to buttress its findings that respondent became a regular employee of the petitioner. therefore. The appellate court's premise that regular employees are those who perform activities which are desirable and necessary for the business of the employer is not determinative in this case. Hence. respondent clearly admitted that petitioner hired him in a limited capacity only and that there will be no employer-employee relationship between them. Respondent's monthly retainer fees were paid to him either at his residence or a local restaurant. or to security of tenure. the absence of the parties' retainership agreement notwithstanding. Furthermore. or the so-called "control test. even without being hired as an employee. it does not apply where the existence of an employment relationship is in dispute. no matter how necessary for the latter's business. Issue: Whether or not CA erred in applying Article 280? Ruling: Well-entrenched is the doctrine that the existence of an employer-employee relationship is ultimately a question of fact and that the findings thereon by the Labor Arbiter and the NLRC shall be accorded not only respect but even finality when supported by substantial evidence. Moreover. Verily.respondent's length of service and petitioner's repeated act of assigning respondent some tasks to be performed did not result to respondent's entitlement to the rights and privileges of a regular employee. he still cannot be considered as a regular employee of petitioner. any agreement may provide that one party shall render services for and in behalf of another. Among other things.It is. Being a question of fact. regular employees and casual employees. Respondent is not an employee. much more a regular employee of petitioner. Indeed. However. Article 280 of the Labor Code. the Court has ruled that said provision is not the yardstick for determining the existence of an employment relationship because it merely distinguishes between two kinds of employees. (3) the power of dismissal. Jefferson M. Respondent was assigned tasks to perform. i. allowances and other benefits. respondent was left alone and given the freedom to accomplish the tasks using his own means and method. the determination whether such a relationship exists between petitioner and respondent was well within the province of the Labor Arbiter and the NLRC.

LABOR RELATIONS
Atty. Jefferson M. Marquez

21. Semblante vs. CA, G.R. No. 196426, August 15, 2011

Facts:

Petitioners Marticio Semblante and Dubrick Pilar worked in the Gallera de Mandaue owned by the respondents-spouses Vicente and Maria Luisa
Loot. The petitioners rendered their services as the official massiador and sentenciador in 1993. As the masiador, Semblante calls and takes the
bets from the gamecock owners and other bettors and orders the start of the cockfight. He also distributes the winnings after deducting
the arriba, or the commission for the cockpit. Meanwhile, as the sentenciador, Pilar oversees the proper gaffing of fighting cocks, determines the
fighting cocks' physical condition and capabilities to continue the cockfight, and eventually declares the result of the
cockfight. As masiador and sentenciador, Semblante receives PhP2,000 per week or a total of PhP8,000 per month, while Pilar gets PhP3,500 a
week or PhP14,000 per month. They work every Tuesday, Wednesday, Saturday, and Sunday every week, excluding monthly derbies and
cockfights held on special holidays. Their working days start at 1:00 p.m. and last until 12:00 midnight, or until the early hours of the morning
depending on the needs of the cockpit. Petitioners had both been issued employees' identification cards that they wear every time they report for
duty. However on November 14,1993, petitioners were denied entry into the cockpit upon the instructions of respondents and were informed of
the termination of their employment effective that date.

Respondents denied that petitioners were their employees and alleged that they were associates of respondents’ independent contractor, Tomas
Vega. They claimed that petitioners have no regular working time or day and they are free to decide for themselves whether to report for work or
not on any cockfighting day. And the identification card issued was only to free them from the normal entrance fees and to differentiate them from
the general public.

The Labor Arbiter found that there exist an employer-employee relationship between the petitioner and the respondents because the latter
performed the works necessary and indispensable to the usual trade or business of the respondents for a number of years. It has ruled that
petitioners were illegally dismissed and are entitled to their backwages and separation pay. However, the NLRC reversed the Labor Arbiter’s
decision. It held that respondents having no power on the selection and engagement of petitioners and that no separate individual contract with
respondents was ever executed by petitioners. In its appeal to the CA, the latter ruled in favor for the respondents and held that referees and
bet-takers in a cockfight need to have the kind of expertise that is characteristic of the game to interpret messages conveyed by mere gestures.
Hence, petitioners are akin to independent contractors who possess unique skills , expertise and talent to distinguish them from ordinary
employees. Further, petitioners were not provided by tools and instrumentalities they needed to perform their work. They only need their unique
skills and talents in the performance of their job as masiador and sentenciador.

Issue:

Whether or not the dismissal of the petitioners is illegal on the ground that that they are regular employees of the respondents?

Ruling:

Respondents had no part in petitioners' selection and management; petitioners' compensation was paid out of the arriba (which is a percentage
deducted from the total bets), not by petitioners; and petitioners performed their functions as masiador and sentenciador free from the direction
and control of respondents. In the conduct of their work, petitioners relied mainly on their "expertise that is characteristic of the cockfight

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LABOR RELATIONS
Atty. Jefferson M. Marquez

gambling," and were never given by respondents any tool needed for the performance of their work. Respondents, not being petitioners'
employers, could never have dismissed, legally or illegally, petitioners, since respondents were without power or prerogative to do so in the first
place. The rule on the posting of an appeal bond cannot defeat the substantive rights of respondents to be free from an unwarranted burden of
answering for an illegal dismissal for which they were never responsible.

22. Bernarte vs. Phil. Basketball Assoc., G.R. No. 192084, September 14, 2011

Facts:

Complainants (Jose Mel Bernarte and Renato Guevarra) aver that they were invited to join the PBA as referees. During the leadership of
Commissioner Emilio Bernardino, they were made to sign contracts on a year-to-year basis. During the term of Commissioner Eala, however,
changes were made on the terms of their employment.

Complainant Bernarte, for instance, was not made to sign a contract during the first conference of the All-Filipino Cup which was from February
23, 2003 to June 2003. It was only during the second conference when he was made to sign a one and a half month contract for the period July
1 to August 5, 2003.

On January 15, 2004, Bernarte received a letter from the Office of the Commissioner advising him that his contract would not be renewed citing
his unsatisfactory performance on and off the court. It was a total shock for Bernarte who was awarded Referee of the year in 2003. He felt that
the dismissal was caused by his refusal to fix a game upon order of Ernie De Leon.

On the other hand, complainant Guevarra alleges that he was invited to join the PBA pool of referees in February 2001. On March 1, 2001, he
signed a contract as trainee. Beginning 2002, he signed a yearly contract as Regular Class C referee. On May 6, 2003, respondent Martinez
issued a memorandum to Guevarra expressing dissatisfaction over his questioning on the assignment of referees officiating out-of-town games.
Beginning February 2004, he was no longer made to sign a contract.

Respondents aver, on the other hand, that complainants entered into two contracts of retainer with the PBA in the year 2003. The first contract
was for the period January 1, 2003 to July 15, 2003; and the second was for September 1 to December 2003. After the lapse of the latter period,
PBA decided not to renew their contracts.

Complainants were not illegally dismissed because they were not employees of the PBA. Their respective contracts of retainer were simply not
renewed. PBA had the prerogative of whether or not to renew their contracts, which they knew were fixed.

Both the Labor Arbiter and NLRC decided that the petitioners were employees whose dismissals by respondents were illegal.

However, the Court of Appeals overturned the decisions of the NLRC and Labor Arbiter on the ground that the petitioner is an independent
contractor since respondents did not exercise any form of control over the means and methods by which petitioner performed his work as a
basketball referee.

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LABOR RELATIONS
Atty. Jefferson M. Marquez

Issue:

Whether petitioner is an employee of respondents, which in turn determines whether petitioner was illegally dismissed.

Ruling

The Supreme Court affirmed the assailed decision of the Court of Appeals.

To determine the existence of an employer-employee relationship, case law has consistently applied the four-fold test, to wit: (a) the selection
and engagement of the employee; (b) the payment of wages; (c) the power of dismissal; and (d) the employer's power to control the employee
on the means and methods by which the work is accomplished. The so-called "control test" is the most important indicator of the presence or
absence of an employer-employee relationship.

In this case, PBA admits repeatedly engaging petitioner's services, as shown in the retainer contracts. PBA pays petitioner a retainer fee,
exclusive of per diem or allowances, as stipulated in the retainer contract. PBA can terminate the retainer contract for petitioner's violation of its
terms and conditions.

However, respondents argue that the all-important element of control is lacking in this case, making petitioner an independent contractor and not
an employee of respondents.

We agree with respondents that once in the playing court, the referees exercise their own independent judgment, based on the rules of the
game, as to when and how a call or decision is to be made. The referees decide whether an infraction was committed, and the PBA cannot
overrule them once the decision is made on the playing court. The referees are the only, absolute, and final authority on the playing court.
Respondents or any of the PBA officers cannot and do not determine which calls to make or not to make and cannot control the referee when he
blows the whistle because such authority exclusively belongs to the referees. The very nature of petitioner's job of officiating a professional
basketball game undoubtedly calls for freedom of control by respondents.

Moreover, the following circumstances indicate that petitioner is an independent contractor: (1) the referees are required to report for work only
when PBA games are scheduled, which is three times a week spread over an average of only 105 playing days a year, and they officiate games
at an average of two hours per game; and (2) the only deductions from the fees received by the referees are withholding taxes.

In other words, unlike regular employees who ordinarily report for work eight hours per day for five days a week, petitioner is required to report
for work only when PBA games are scheduled or three times a week at two hours per game. In addition, there are no deductions for
contributions to the Social Security System, Philhealth or Pag-Ibig, which are the usual deductions from employees' salaries. These undisputed
circumstances buttress the fact that petitioner is an independent contractor, and not an employee of respondents.

Furthermore, the applicable foreign case law declares that a referee is an independent contractor, whose special skills and independent
judgment is required specifically for such position and cannot possibly be controlled by the hiring party.

In addition, the fact that PBA repeatedly hired petitioner does not by itself prove that petitioner is an employee of the former. For a hired party to
be considered an employee, the hiring party must have control over the means and methods by which the hired party is to perform his work,
which is absent in this case. The continuous rehiring by PBA of petitioner simply signifies the renewal of the contract between PBA and petitioner,

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LABOR RELATIONS
Atty. Jefferson M. Marquez

and highlights the satisfactory services rendered by petitioner warranting such contract renewal. Conversely, if PBA decides to discontinue
petitioner's services at the end of the term fixed in the contract, whether for unsatisfactory services, or violation of the terms and conditions of the
contract, or for whatever other reason, the same merely results in the non-renewal of the contract, as in the present case. The non-renewal of
the contract between the parties does not constitute illegal dismissal of petitioner by respondents.

23. Lirio vs. Genovia, G.R. No. 169757, November 23, 2011

Facts:

Respondent Wilmer D. Genovia filed a complaint against petitioner Cesar Lirio and/or Celkor Ad Sonicmix Recording Studio for illegal dismissal,
non-payment of commission and award of moral and exemplary damages.

Respondent Genovia alleged in his position paper that on August 15, 2001, he was hired as studio manager by petitioner Lirio, owner of Celkor
Ad Sonicmix Recording Studio (Celkor). He was employed to manage and operate Celkor and to promote and sell the recording studio's services
to music enthusiasts and other prospective clients. He received a monthly salary of P7,000.00. They also agreed that he was entitled to an
additional commission of P100.00 per hour as recording technician whenever a client uses the studio for recording, editing or any related work.
He was made to report for work from Monday to Friday from 9:00 a.m. to 6 p.m. On Saturdays, he was required to work half-day only, but most of
the time, he still rendered eight hours of work or more. All the employees of petitioner, including respondent, rendered overtime work almost
everyday, but petitioner never kept a daily time record to avoid paying the employees overtime pay.

He also alleged that petitioner approached him and told him about his project to produce an album for his daughter, Celine Mei Lirio. Petitioner
asked respondent to compose and arrange songs for Celine and promised that he (Lirio) would draft a contract to assure respondent of his
compensation for such services. As agreed upon, the additional services that respondent would render included composing and arranging
musical scores only, while the technical aspect in producing the album, such as digital editing, mixing and sound engineering would be
performed by respondent in his capacity as studio manager for which he was paid on a monthly basis. Petitioner instructed respondent that his
work on the album as composer and arranger would only be done during his spare time, since his other work as studio manager was the priority.
Respondent then started working on the album.

After the album was completed and released, respondent again reminded petitioner about the contract on his compensation as composer and
arranger of the album. Petitioner told respondent that since he was practically a nobody and had proven nothing yet in the music industry,
respondent did not deserve a high compensation, and he should be thankful that he was given a job to feed his family. Petitioner informed
respondent that he was entitled only to 20% of the net profit, and not of the gross sales of the album, and that the salaries he received and would
continue to receive as studio manager of Celkor would be deducted from the said 20% net profit share. Respondent objected and insisted that
he be properly compensated. On March 14, 2002, petitioner verbally terminated respondent’s services, and he was instructed not to report for
work.

Respondent asserts that he was illegally dismissed as he was terminated without any valid grounds, and no hearing was conducted before he
was terminated, in violation of his constitutional right to due process. Having worked for more than six months, he was already a regular
employee. Although he was a so called “studio manager,” he had no managerial powers, but was merely an ordinary employee.

Respondent prayed for his reinstatement without loss of seniority rights, or, in the alternative, that he be paid separation pay, backwages and

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LABOR RELATIONS
Atty. Jefferson M. Marquez

overtime pay; and that he be awarded unpaid commission for services rendered as a studio technician as well as moral and exemplary
damages.

Respondent’s evidence consisted of the Payroll dated July 31, 2001 to March 15, 2002, which was certified correct by petitioner, and Petty Cash
Voucher evidencing receipt of payroll payments by respondent from Celkor.

In defense, petitioner stated in his Position Paper that respondent was not hired as studio manager, composer, technician or as an employee in
any other capacity of Celkor. Respondent could not have been hired as a studio manager, since the recording studio has no personnel except
petitioner.

According to petitioner, respondent had no track record as a composer, and he was not known in the field of music. Nevertheless, after some
discussion, respondent verbally agreed with petitioner to co-produce the album.

Petitioner asserted that his relationship with respondent is one of an informal partnership and that he had no control over the time and manner by
which respondent composed or arranged the songs, except on the result thereof. Respondent reported to the recording studio between 10:00
a.m. and 12:00 noon. Hence, petitioner contended that no employer-employee relationship existed between him and the respondent, and there
was no illegal dismissal to speak of.

The Labor Arbiter rendered a decision finding that an employer-employee relationship existed between petitioner and respondent, and that
respondent was illegally dismissed.

However, the NLRC reversed and set aside the decision of the Labor Arbiter on the ground that respondent failed to prove his employment tale
with substantial evidence. It held that respondent failed to proved with substantial evidence that he was selected and engaged by petitioner, that
petitioner had the power to dismiss him, and that they had the power to control him not only as to the result of his work, but also as to the means
and methods of accomplishing his work.

The Court of Appeals rendered a decision reversing and setting aside the resolution of the NLRC, and reinstating the decision of the Labor
Arbiter.

Hence, petitioner Lirio filed this petition.

Issue:

Whether respondent is an employee of the petitioner, which in turn determines whether respondent was illegally dismissed.

Ruling:

The Supreme Court affirmed the assailed decision of the Court of Appeals.

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LABOR RELATIONS
Atty. Jefferson M. Marquez

Before a case for illegal dismissal can prosper, it must first be established that an employer-employee relationship existed between petitioner
and respondent.

The elements to determine the existence of an employment relationship are: (a) the selection and engagement of the employee; (b) the payment
of wages; (c) the power of dismissal; and (d) the employer’s power to control the employee’s conduct. The most important element is the
employer’s control of the employee’s conduct, not only as to the result of the work to be done, but also as to the means and methods to
accomplish it.

It is settled that no particular form of evidence is required to prove the existence of an employer-employee relationship. Any competent and
relevant evidence to prove the relationship may be admitted.

In this case, the documentary evidence presented by respondent to prove that he was an employee of petitioner are as follows: (a) a document
denominated as "payroll" (dated July 31, 2001 to March 15, 2002) certified correct by petitioner, which showed that respondent received a
monthly salary of P7,000.00 (P3,500.00 every 15th of the month and another P3,500.00 every 30th of the month) with the corresponding
deductions due to absences incurred by respondent; and (2) copies of petty cash vouchers, showing the amounts he received and signed for in
the payrolls.

The said documents showed that petitioner hired respondent as an employee and he was paid monthly wages of P7,000.00. Petitioner wielded
the power to dismiss as respondent stated that he was verbally dismissed by petitioner, and respondent, thereafter, filed an action for illegal
dismissal against petitioner. The power of control refers merely to the existence of the power. It is not essential for the employer to actually
supervise the performance of duties of the employee, as it is sufficient that the former has a right to wield the power. Nevertheless, petitioner
stated in his Position Paper that it was agreed that he would help and teach respondent how to use the studio equipment. In such case,
petitioner certainly had the power to check on the progress and work of respondent.

On the other hand, petitioner failed to prove that his relationship with respondent was one of partnership. Such claim was not supported by any
written agreement. The Court notes that in the payroll dated July 31, 2001 to March 15, 2002, there were deductions from the wages of
respondent for his absence from work, which negates petitioner’s claim that the wages paid were advances for respondent’s work in the
partnership.

The Court agrees with the Court of Appeals that the evidence presented by the parties showed that an employer-employee relationship existed
between petitioner and respondent.

In termination cases, the burden is upon the employer to show by substantial evidence that the termination was for lawful cause and validly
made.Article 277 (b) of the Labor Code puts the burden of proving that the dismissal of an employee was for a valid or authorized cause on the
employer, without distinction whether the employer admits or does not admit the dismissal. For an employee’s dismissal to be valid, (a) the
dismissal must be for a valid cause, and (b) the employee must be afforded due process. Procedural due process requires the employer to
furnish an employee with two written notices before the latter is dismissed: (1) the notice to apprise the employee of the particular acts or
omissions for which his sought, which is the equivalent of a charge; and (2) the notice informing the employee of his dismissal, to be issued after
the employee has been given reasonable opportunity to answer and to be heard on his defense. Petitioner failed to comply with these legal
requirements; hence, the Court of Appeals correctly affirmed the Labor Arbiter’s finding that respondent was illegally dismissed, and entitled to
the payment of backwages, and separation pay in lieu of reinstatement.

Page 29

LABOR RELATIONS
Atty. Jefferson M. Marquez

24. Jao vs. BCC Product Sales Inc., G.R. No. 163700, April 18, 2012

Facts:

Petitioner maintained that respondent BCC Product Sales Inc. (BCC) and its President, Terrance Ty, employed him as comptroller
starting from September 1995 with a monthly salary of P20,000.00 to handle the financial aspect of BCC’s business. On October 19,1995, the
security guards of BCC, acting upon the instruction of Ty, barred him from entering the premises of BCC where he then worked. His attempts to
report to work in November and December 12, 1995 were frustrated because he continued to be barred from entering the premises of BCC. He
then filed a complaint for illegal dismissal, reinstatement with full backwages, non-payment of wages, damages and attorney’s fees.

Respondents countered that petitioner was not their employee but the employee of Sobien Food Corporation (SFC), the major creditor
and supplier of BCC; and that SFC had posted him as its comptroller in BCC to oversee BCC’s finances and business operations and to look
after SFC’s interests or investments in BCC.

Issue:

Whether or not an employer-employee relationship existed between petitioner Jao and BCC

Ruling:

The Supreme Court speaking through Justice Bersamin declared that the court cannot side with petitioner.

In determining the presence or absence of an employer-employee relationship, the Court has consistently looked for the following
incidents, to wit: (a) the selection and engagement of the employee; (b) the payment of wages; (c) the power of dismissal; and (d) the employer’s
power to control the employee on the means and methods by which the work is accomplished. The last element, the so-called control test, is the
most important element.

Hereunder are some of the circumstances and incidents occurring while petitioner was supposedly employed by BCC that debunked his claim
against respondents. It can be deduced from the March 1996 affidavit of petitioner that respondents challenged his authority to deliver some 158
checks to SFC. Considering that he contested respondents’ challenge by pointing to the existing arrangements between BCC and SFC, it should
be clear that respondents did not exercise the power of control over him, because he thereby acted for the benefit and in the interest of SFC
more than of BCC.

Page 30

The carrying out of the Five Year Expansion Program constitutes a distinct undertaking identifiable from the ordinary business and activity of NSC. ALU-TUCP vs. Each component project. regular employees are legally entitled to remain in the service of their employer until that service is terminated by one or another of the recognized modes or termination of service under the Labor Code. and not merely as a Page 31 . desirable and work related to NSC’s main business which is steel making and that they have rendered service for more than six years. There are two types of project activities. Petitioners were then terminated. The simple fact that the employment of petitioners as project employees had gone beyond one year does not detract from or legally dissolve their status as project employees. the length of service of a project employee is not the controlling test of employment of tenure. The services of these project employees may be lawfully terminated at the completion of the project. their work was limited to one or another of the specific component projects which made up the Five Year Expansion Program. The case at bar falls on the second type of project activity. 234 SCRA 678 [1994] Facts: National Steel Corporation (NSC) employed petitioners in connection with its Five Year Expansion Program. of course. a common basic requisite is that the designation of named employees as "project employees" and their assignment to a specific project. Issue: Whether or not petitioners were properly characterized as regular employees rather than project employees. begins and ends at specified times which had already been determined by the time petitioners were engaged. regularization and monetary benefits. It undertook this program with the end in view of expanding the volume and increasing the kinds of products that it may offer for sale to the public. the duration and the scope of which were specified at the time the employees were engaged for that project. The principal test for determining whether an employee is properly characterized as project employees is whether or not the project employees were carrying out a specific project or undertaking. Their contention was that they should be considered regular employees because their jobs are necessary. NLRC. It is dependent and coterminous with the completion or termination of the specific undertaking or activity for which the employee was hired which has been pre-determined at the time of the engagement. Ruling: Petitioners are project employees. Second is a particular job or undertaking that is not within the regular business of the corporation. are effected and implemented in good faith. but which is distinct and separate and identifiable as such. from the other undertakings of the company. During the time petitioners rendered services to NSC. Jefferson M. Such a job or undertaking must also be identifiably separate and distinct from the ordinary or regular business operations of the employer. Furthermore. Whichever type of project employment is found in a particular case. LABOR RELATIONS Atty. Project employees are those employed for a fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee. Marquez RIGHT TO SECURITY OF TENURE CASES: 1. It must also begin and end at determined or determinable times. They were not hired or assigned to any other purpose. They filed a complaint for unfair labor practice. On the other hand. Such job or undertaking begins and ends at determined or determinable times. First is that a project could refer to a particular job or undertaking that is within the regular or usual business of the employer company.

Purefoods v. 2. Marquez means of evading otherwise applicable requirements of labor laws. he could not be dismissed without a just and valid cause. NLRC 283 SCRA 136 [1997] Facts: The private respondents (numbering 906) were hired by petitioner Pure Foods Corporation to work for a fixed period of five months at its tuna cannery plant. Having satisfactorily served the company for two (2) terms.. considering that his employment was limited to the installation and dismantling of petitioner’s annex plant machines after which there was no more work to do. For obvious reasons. Castro’s employment was terminated due to the completion of the special project. Ruling: Private respondent being a project employee. a complaint for illegal dismissal against the petitioner and its plant manager. seasonal employee. he was re-hired and assigned to the Maintenance Division of the Davao Project tasked to install the private respondent’s annex plant machines in its Davao plant. or to use the correct term. Castro was recommended for reemployment with the company’s Maintenance Team for the Davao Project. 1990 prior to the termination of the other regular employees of Cosmos by reason of retrenchment. The company alleged that Castro was a mere project employee whose employment was co- terminous with the project for which he was hired. Castro was employed by Cosmos Bottling Corporation for a specific period. They thenexecuted a “Release and Quitclaim” stating that they had no claim whatsoever against Pure Foods. Castro is a regular employee or was a mere project employee of petitioner Cosmos Bottling Corporation. Neither should it constitute retrenchment as private respondent was a seasonal employee whose services were already terminated on May 21. Issue: Whether or not private respondent Gil C. Page 32 . 255 SCRA 358 [1996] Facts: Gil C. Castro filed a complaint for illegal dismissal against Cosmos Bottling Corporation with the Labor Arbiter contending that being a regular employee. vs NLRC. The private respondents filed before the NLRC Sub-Regional Arbitration Branch. Cosmos Bottling Corp. Castro was not among the list of those regular employees whose services were terminated by reason of retrenchment or those who voluntarily resigned. After the expiration of their respective contracts of employment. 3. LABOR RELATIONS Atty. his employment legally ended upon completion of the project. That being so. the termination of his employment cannot and should not constitute an illegal dismissal. their services were terminated. Cosmos Bottling Corporation in valid exercise of its management prerogative terminated the services of some 228 regular employees by reason of retrenchment. Jefferson M.

” which is a clear circumvention of the law on security of tenure. Ruling: We find the petition devoid of merit. In any event. on the other hand. whether continuous or broken. An employment shall be deemed to be casual if it is not covered by the preceding paragraph. LABOR RELATIONS Atty. Provided. however. which reads: “Provided that any employee who has rendered at least one year of service. private respondents' prayer for reinstatement is well within the purview of the “Release and Quitclaim” they had executed wherein they unconditionally released the petitioner from any and all other claims which might have arisen from their past employment with the petitioner. with respect to the activity in which they are employed. Article 280 of the Labor Code defines regular and casual employment as follows: ART. That. 280. argue that contracts with a specific period of employment may be given legal effect provided. whether such service is continuous or broken. Marquez Pure Foods Corp submits that the private respondents are now estopped from questioning their separation from petitioner’s employ in view of their express conformity with the five-month duration of their employment contracts. Page 33 .” In the instant case. except where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season.. They submit that the practice of the petitioner in hiring workers to work for a fixed duration of five months only to replace them with other workers of the same employment duration was apparently to prevent the regularization of these so-called “casuals. they fell within the exception provided in Article 280 of the Labor Code which reads: “[E]xcept where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee. Besides.. shall be considered a regular employee with respect to the activity in which he is employed and his employment shall continue while such activity exists. the two kinds of regular employees are (1) those who are engaged to perform activities which are necessary or desirable in the usual business or trade of the employer. Issue: Whether employees hired for a definite period and whose services are necessary and desirable in the usual business or trade of the employer are regular employees. Regular and Casual Employment. any employee who has rendered at least one year of service. Moreover. Thus. the first paragraph of the said article must be read and interpreted in conjunction with the proviso in the second paragraph.. shall be considered a regular employee with respect to the activity in which he is employed. whether such service is continuous or broken.-. The private respondents. and (2) those casual employees who have rendered at least one year of service. the private respondents were employed for a period of five months only. that they are not intended to circumvent the constitutional guarantee on security of tenure. Jefferson M. an employment shall be deemed to be regular where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer.The provisions of written agreement to the contrary notwithstanding and regardless of the oral argument of the parties.

the services employed are then necessary and desirable in the employer’s usual business only for the period of time it takes to complete the project. xxx Where from the circumstances it is apparent that the periods have been imposed to preclude acquisition of tenurial security by the employee. the private respondents’ activities consisted in the receiving. duress. It was a clear circumvention of the employees’ right to security of tenure and to other benefits like minimum wage. The term “specific project or undertaking” under Article 280 of the Labor Code contemplates an activity which is not commonly or habitually performed or such type of work which is not done on a daily basis but only for a specific duration of time or until completion. or 2) It satisfactorily appears that the employer and the employee dealt with each other on more or less equal terms with no moral dominance exercised by the former or the latter. Jefferson M. This scheme of the petitioner was apparently designed to prevent the private respondents and the other “casual” employees from attaining the status of a regular employee. the petitioner succeeded in evading the application of labor laws. Marquez In the instant case. cost-of-living allowance. xxx …criteria under which term employment cannot be said to be in circumvention of the law on security of tenure: 1) The fixed period of employment was knowingly and voluntarily agreed upon by the parties without any force. it saved itself from the trouble or burden of establishing a just cause for terminating employees by the simple expedient of refusing to renew the employment contracts. skinning. holiday pay. xxx Contrary to petitioner's submission. the private respondents could not be regarded as having been hired for a specific project or undertaking. they should be struck down or disregarded as contrary to public policy and morals. or improper pressure being brought to bear upon the employee and absent any other circumstances vitiating his consent. therefore. packing. Indisputably. and casing-up of tuna fish which were then exported by the petitioner. loining. None of these criteria had been met in the present case. sick leave. The fact that the petitioner repeatedly and continuously hired workers to do the same kind of work as that performed by those whose contracts had expired negates petitioner’s contention that those workers were hired for a specific project or undertaking only. LABOR RELATIONS Atty. Also. The five-month period specified in private respondents’ employment contracts having been imposed precisely to circumvent the constitutional guarantee on security of tenure should. be struck down or disregarded as contrary to public policy or morals Page 34 . they were performing activities which were necessary and desirable in petitioner’s business or trade. Indeed. and 13th month pay.

NLRC. filed a complaint for unfair labor practice and/or illegal dismissal with damages against Petitioner Corporation. 310 SCRA 680 [1999] Facts: Private respondent Philippine Fruit and Vegetable Workers Union-Tupas Local Chapter. Jefferson M. NLRC set aside the Labor Arbiter’s decision and remanded the said case to the Arbitration Branch for further proceedings. Arbitration Branch rendered a decision finding PFVII liable for illegal dismissal. According to them. LABOR RELATIONS Atty. and since complainants are seasonal workers as defined by the Labor Code. Labor Arbiter rendered judgment that Philippine Fruit & Vegetable Industries. The severance of complainants' employment from petitioner corporation was a necessary consequence of the nature of seasonal employment. its operation starts only in February with the processing of tomatoes into tomato paste and ceases by the end of the same month when the supply is consumed. for and in behalf of 127 of its members. They alleged that the dismissals were due to complainants' involvement in union activities and were without just cause. Fruit and Vegetable Industries v. Inc (PFVII) were indeed guilty of Illegal Dismissal. PFVII filed a motion for reconsideration which was denied by NLRC Issue: Whether or not the complainants were illegal dismissed by PFVII One of PFVII’s contentions is that the complainants are seasonal workers. they cannot invoke any tenurial benefit Ruling: Page 35 . NLRC affirmed the Arbitration Branch’s decision but modified the awards of attorney’s fees. It then resumes operations at the end of April or early May. On appeal. On appeal. Phil. Marquez 4. depending on the availability of supply with the processing of mangoes into purees and ceases operation in June.

An employment shall be deemed to be casual if it is not covered by the preceding paragraph. Neither is their employment seasonal in nature. 1992. indeed. Line supervisor Shirley F. She. Fardiquela.). the petitioner employed 1. 1992. On May 8. 2004 Facts: The petitioner Philips Semiconductors (Phils.4. The Labor Code provides an employment shall be deemed to be regular where the employee has been engaged to perform activities that are usually necessary or desirable in the usual business or trade of the employers. more than six (6) months a year. drivers. is a domestic corporation engaged in the production and assembly of semiconductors such as power devices.R. 141717. the work of complainants as seeders. telecommunications equipment and cars. COMPLAINANTS ARE REGULAR EMPLOYEES BY VIRTUE OF THE FACT THAT THEY PERFORMED FUNCTIONS WHICH ARE NECESSARY AND DESIRABLE IN THE USUAL BUSINESS OF PFVII. sorters. the other equally important aspects of its business. the services of the complainants are. The fact is that large-scale food processing companies such as Petitioner Company continue to operate and do business throughout the year even if the availability of fruits and vegetables is seasonal. that is. except where the employment has been fixed for a specific project. pineapple. 1993. any employee who has rendered at least one year of service whether such service is continuous or broken. the respondent’s contract was extended for another three months. The employees were subjected to periodic performance appraisal based on output. Jefferson M. however.0 for the period covered by the performance appraisal to maintain good standing as an employee. RF modules. but the latter Page 36 .029 regular workers. It also processed guyabano. After garnering a performance rating of 3. respondent Eloisa Fadriquela executed a Contract of Employment with the petitioner in which she was hired as a production operator with a daily salary of P118. 1993 to April 4. entitled to security of tenure. Marquez By the very nature of things in a business enterprise like PFVII.15. they have the office of administrative functions. 5. Aside from contractual employees. quality. truck helpers. 1993 to June 4. cleaning and upkeeping of machines and other duties and tasks to keep up a big food processing corporation. In the case at bar. 1992. Considering. It should be noted that complainants' employment has not been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of their appointment or hiring. The company did not confine itself just to the processing of tomatoes and mangoes. from April 5. operators. when she received a performance rating of 3. LABOR RELATIONS Atty. slicers. but was extended for two months when she garnered a performance rating of 3. 1993.After the expiration of her third contract. that. CATV modules. Philips Semiconductor vs. such as manufacturing and marketing are not seasonal. attendance and work attitude. from January 4. Inc. G. Her initial contract was for a period of three months up to August 8. It caters to domestic and foreign corporations that manufacture computers. RF and metal transistors and glass diods. janitors. While it may be true that some phases of petitioner company's processing operations is dependent on the supply of fruits for a particular season. that under Article 280 of the Labor Code "the provisions of written agreement to the contrary notwithstanding and considering further that the tasks which complainants performed were usually necessary and desirable in the employers usual business or trade. Supreme Court held that complainants are regular seasonal employees. etc. April 14. mechanics and office personnel is without doubt necessary in the usual business of a food processing company like petitioner PFVII. provided. Velayo asked the respondent why she incurred the said absences. that is. incurred five absences in the month of April. Her contract was again renewed for two months or up to December 16. shall be considered a regular employee with respect to the activity in which he is employed and his employment shall continue while such actually exists. therefore. PETITION DENIED.8. thus. for three months. No. three absences in the month of May and four absences in the month of June. papaya. calamansi. it was extended anew. Besides. One was required to obtain a performance rating of at least 3.

we grant petitioner’s Page 37 . the respondent’s contract of employment was no longer renewed. the employment is also considered regular. In pursuance of Article 279 of the Labor Code. The two kinds of regular employees under the law are (1) those engaged to perform activities which are necessary or desirable in the usual business or trade of the employer. is too harsh a penalty. The court concludes that petitioner’s dismissal is illegal because. the respondent was employed by the petitioner on May 8.Also. The respondent was warned that if she offered no valid justification for her absences. and second. The primary standard to determine a regular employment is the reasonable connection between the particular activity performed by the employee in relation to the business or trade of the employer. the respondent had attained the regular status of her employment with the petitioner. (c)whether or not the respondent is entitled to reinstatement and full payment of backwages as well as attorney’s fees. to the same position. and On the second and third issues. For. She was assigned to wirebuilding at the transistor division. we deem it proper to order the reinstatement of petitioner to her former job and the payment of her full backwages. The respondent still failed to respond. even if the performance is not continuous or merely intermittent.[22] The law does not provide the qualification that the employee must first be issued a regular appointment or must be declared as such before he can acquire a regular employee status. she was not afforded procedural due process. 1992 as production operator. Such a continuing need for the services of the respondent is sufficient evidence of the necessity and indispensability of her services to the petitioner’s business. If the employee has been performing the job for at least one year. 1993. By operation of law. whatever missteps may have been committed by the worker ought not to be visited with a consequence so severe such as dismissal from employment. We do agree that an employee may be dismissed for violation of reasonable regulations/rules promulgated by the employer. the Constitution guarantees the right of workers to “security of tenure. as a consequence of which her performance rating declined to 2. Hence. the law deems the repeated and continuing need for its performance as sufficient evidence of the necessity. but only with respect to such activity and while such activity exists. Issues and Rulings: (a) whether or not the respondent was still a contractual employee of the petitioner as of June 4. Where a penalty less punitive would suffice. we agree with the appellate court that the respondent was dismissed by the petitioner without the requisite notice and without any formal investigation. if not indispensability of that activity to the business of the employer. first. even if true. 1992 to June 4. Dismissal is the ultimate penalty that can be meted to an employee. having been compelled to come to court to protect her rights. and (2) those casual employees who have rendered at least one year of service. Velayo recommended to the petitioner that the respondent’s employment be terminated due to habitual absenteeism. she was dismissed in the absence of a just cause. Given the factual milieu in this case. the respondent’s dismissal from employment for incurring five (5) absences in April 1993. The original contract of employment had been extended or renewed for four times. She remained under the employ of the petitioner without any interruption since May 8. and is thus entitled to security of tenure as provided for in Article 279 of the Labor Code which reads: (b) whether or not the petitioner dismissed the respondent from her employment. Thus. Marquez failed to explain her side. LABOR RELATIONS Atty. with the same chores. then. 1993 or for one (1) year and twenty-eight (28) days. The test is whether the former is usually necessary or desirable in the usual business or trade of the employer. three (3) absences in May 1993 and four (4) absences in June 1993.” The misery and pain attendant to the loss of jobs then could be avoided if there be acceptance of the view that under certain circumstances of the case the workers should not be deprived of their means of livelihood. if so. There is no dispute that the work of the respondent was necessary or desirable in the business or trade of the petitioner. whether or not she was accorded the requisite notice and investigation prior to her dismissal. Jefferson M.8. in accordance with the Company Rules and Regulations. with respect to the activities in which they are employed.In this case. whether continuous or broken. Velayo would have no other recourse but to recommend the non-renewal of her contract.

he was already a regular employee. On 20 November 1996. 6. respondents claim that. Section 6 (d) of Rule 1 of the Implementing Rules of Book VI of the Labor Code (Department Order No. Alcira vs. No. It is only but natural that the evaluation should be made vis-à-vis the performance standards for the job. was late several times and violated company rules on the wearing of uniform. 1996. petitioner cannot successfully say that he was never informed by private respondent of the standards that he must satisfy in order to be converted into regular status. Jefferson M. In short. when he was dismissed on November 20. We hold that respondent Middleby substantially notified petitioner of the standards to qualify as a regular employee when it apprised him. This runs counter to the agreement between the parties that after five months of service the petitioner’s performance would be evaluated. six months total one hundred eighty days. Since he failed to meet company standards. Petitioner insists that he already attained the status of a regular employee when he was dismissed on November 20. during petitioner’s probationary employment. petitioner was still a probationary employee when respondent Middleby opted not to “regularize” him on November 20. hired petitioner as engineering support services supervisor on a probationary basis for six months.R. 10. 149859. 1996. According to petitioner’s computation. Marquez prayer for attorney’s fees. We agree with the labor arbiter when he ruled that: In the instant case. Series of 1997) provides that: In all cases of probationary employment. the 180th day fell on November 16. Page 38 . Our computation of the 6-month probationary period is reckoned from the date of appointment up to the same calendar date of the 6th month following. 1996 because. 2004 Facts: Middleby Philippines Corp. NLRC. a senior officer of Middleby withheld his time card and did not allow him to work. incurred ten absences. Petitioner’s contention is incorrect. In their defense. that it would evaluate his supervisory skills after five months.)” without any specific date of termination. June 9. G. an employer is deemed to substantially comply with the rule on notification of standards if he apprises the employee that he will be subjected to a performance evaluation on a particular date after his hiring. the six-month probationary period ended on November 16. petitioner’s application to become a regular employee was disapproved and his employment was terminated. 1996. having started work on May 20. since Article 13 of the Civil Code provides that one month is composed of thirty days. Issues and Rulings: (1) Whether petitioner was allowed to work beyond his probationary period and was therefore already a regular employee at the time of his alleged dismissal. 1996. LABOR RELATIONS Atty. since the number of days in each particular month was irrelevant. Thus. Alcira filed with the NLRC a complaint for illegal dismissal on the contention that he had become a regular employee when he was illegally dismissed. As the appointment provided that petitioner’s status was “probationary (6 mos. at the start of his employment. (2) Whether respondent Middleby informed petitioner of the standards for “regularization” at the start of his employment. he shall be deemed a regular employee. Where no standards are made known to the employee at that time. he showed poor performance in his assigned tasks. Private respondent Trifona Mamaradlo speaks of such standard in her affidavit referring to the fact that petitioner did not perform well in his assigned work and his attitude was below par compared to the company’s standard required of him. the employer shall make known to the employee the standards under which he will qualify as a regular employee at the time of his engagement. 1996.

he was already a regular employee on the date of the termination of his probationary employment. On that date. the same cannot be deemed illegal. 2004 Facts: Nelson Paras first worked for Mitsubishi Motors Philippines Corporation (MMPC) as a shuttle bus driver from March 19. the NLRC and the Court of Appeals. argued that Paras was dismissed on his one hundred eighty third (183rd) day of employment. informing him that his services were terminated effective the said date since he failed to meet the required company standards for regularization. G. petitioner (1) incurred ten absences (2) was tardy several times (3) failed to wear the proper uniform many times and (4) showed inferior supervisory skills. 1996 would expire on November 27. including the company standards for regularization. Middleby exercised its option not to renew the contract when it informed petitioner on the last day of his probationary employment that it did not intend to grant him a regular status. No. corporate philosophy. 1994 to October 31. Meanwhile. As found by the labor arbiter. 1994. MMPC argued that under Article 13 of the New Civil Code. the parties are free to either renew or terminate their contract of employment. Paras started reporting for work. CPLU. Chrysler Phil Labor Union. On October 29. the Department and Division Managers reviewed the performance evaluation made on Paras. his contract was renewed from November 1. On May 27. 1996. As part of the MMPC’s policy. 1994 up to March 3. Mitsubishi Motors Phils. respondent Middleby was clearly justified to end its employment relationship with petitioner. June 29. along with Paras’ immediate supervisors. air make-up and conveyors. But this constitutional protection ends on the expiration of the probationary period. Taking all this in its entirety. Petitioner failed to satisfactorily refute these substantiated allegations. 7. Later. 1994. Jefferson M. LABOR RELATIONS Atty. 1976 to June 16. Paras was later re-hired on a probationary basis as a manufacturing trainee at the Plant Engineering Maintenance Department sometime in May of 1996. He was assigned at the paint ovens. As a consequence. and received an average rating. hence. Issue: Page 39 . the supervisors informed Paras that based on his performance rating. organizational structure. and company rules and regulations. They unanimously agreed. However. 1995. or three (3) days after the expiration of the probationary period of six (6) months. code of conduct and company- provided benefits. This means they may only be terminated for just cause or when they otherwise fail to qualify as regular employees in accordance with reasonable standards made known to them by the employer at the time of their engagement. Paras’ probationary employment which commenced on May 27. This development has rendered moot the question of whether there was a just cause for the dismissal of the petitioners. Marquez (3) Whether petitioner was illegally dismissed when respondent Middleby opted not to renew his contract on the last day of his probationary employment. After working in Saudi Arabia from 1982 to 1993. 1996. He and the new and re-hired employees were then given an orientation about the company’s history. 1996. vs. It is settled that even if probationary employees do not enjoy permanent status. 148738. he would be regularized. Although we can regard petitioner’s severance from work as dismissal. he was re-hired as a welder-fabricator at the MMPC tooling shop from October 3. when he resigned to work abroad. the same should be considered to have been served within the six-month probationary period. 1996. he received a Notice of Termination dated November 25. they are accorded the constitutional protection of security of tenure. Since he received the notice of termination of his employment on November 25. that his performance was unsatisfactory. 1982. 1996. a legitimate labor organization and the duly certified bargaining agent of the hourly-paid regular rank and file employees of MMPC in which Paras was a member. Paras was not considered for regularization.R. On November 26. Paras was evaluated by his immediate supervisors after six (6) months.

Such probationary period. Upon the expiration of their respective contracts. the period of one hundred eighty (180) days. Applying Article 13 of the Civil Code. the probationary period of six (6) months consists of one hundred eighty (180) days. six (6). 1996.. in the exercise of its management prerogative. Indeed. Jefferson M. It is. The employee’s services may be terminated for just cause or for his failure to qualify as a regular employee based on reasonable standards made known to him. Ruling: Yes. which provides that the months which are not designated by their names shall be understood as consisting of thirty (30) days each. The number of months in the probationary period. 13th month pay. As clearly provided for in the last paragraph of Article 13. it employs hundreds of employees. as "emergency workers. During the orientation conducted on May 15. and ended on November 23. They stressed that based on the nature of their work. their services were terminated.This is in conformity with paragraph one. He reported for work on May 27.m. unless covered by an apprenticeship agreement. the distributor of dressed chicken to various restaurants and establishments nationwide. Marquez Whether or not Paras was already a regular employee when he was terminated. As per the company’s policy. Pangilinan vs.R. the one hundred eighty (180) days commenced on May 27. likewise. Article 13 of the Civil Code. The petitioners alleged that their work as chicken dressers was necessary and desirable in the usual business of the respondent. the first day shall be excluded and the last day included. hence. Most of them worked as chicken dressers. may hire an employee on a probationary basis in order to determine his fitness to perform work. LABOR RELATIONS Atty. No. the probationary period was from three (3) months to a maximum of six (6) months. some on a regular basis and others on a casual basis. he was apprised of the standards upon which his regularization would be based. while the others served as packers or helpers. Respondent Paras was employed as a management trainee on a probationary basis. could not be dismissed from their employment unless for just cause and after due notice. should then be multiplied by the number of days within a month. The termination letter dated November 25. thirty (30). Page 40 . G. by then. They later filed separate complaints for illegal dismissal and non-payment of holiday pay. hence. of November 26. 1996. 8. He was. 1996. 1996 was served on respondent Paras only at 3:00 a. cannot be dismissed without just cause and the required due process. Thus. they were regular employees of the respondent. already a regular employee of the petitioner under Article 281 of the Labor Code." The petitioners were employed by the respondent on different dates as emergency workers at its poultry plant under separate "temporary/casual contracts of employment" for a period of five months. As such. July 2. night-shift differential and service incentive leave pay against the respondent. 1996. in computing a period. 2004 Facts: The respondent General Milling Corporation is a domestic corporation engaged in the production and sale of livestock and poultry. shall not exceed six (6) months from the date the employee started working. an employer. Under Article 281 of the Labor Code. thus. 1996. 149329. the employer must inform the employee of the standards for which his employment may be considered for regularization. Issue: Whether or not petitioners are regular employees and. General Milling Co.

Ravago commenced Page 41 .. (c) casual employees or those who are neither regular nor project employees. In any case. Ravago vs. and This Temporary/Casual Employment contract. nothing therein shows that these contracts were used as a subterfuge by the respondent GMC to evade the provisions of Articles 279 and 280 of the Labor Code. it terminates on the expiration of such period. they cannot be said to be regular employees. or if she/he has violated any of the established rules and regulations of the Company. without the necessity of any prior notice to the employee concerned. The employee aforementioned may be laid off or separated from the Firm. duress or improper pressure. and. 2005 Facts: Roberto Ravago was hired by Trans-Global to work as a seaman on board various Esso vessels. Jefferson M. 4. they were employed on a mere temporary basis. 3. Lack of notice of termination is of no consequence. Esso Eastern Marine Ltd. EVEN BEFORE THE EXPIRY DATE OF THIS CONTRACT. No. (b) project employees or those whose employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season. Similarly. the period of employment shall not go beyond the duration of the work or purpose for which the aforementioned employee has been engaged. since their employment was limited to a fixed period. A regular employee is one who is engaged to perform activities which are necessary and desirable in the usual business or trade of the employer as against those which are undertaken for a specific project or are seasonal. March 14. G. IT IS CLEARLY STIPULATED THAT THE CONDITION OF THE EMPLOYMENT CONTRACT SHALL BE AS FOLLOWS: 1. but are merely "contractual employees. On February 13. 9." Consequently. 2. While the petitioners' employment as chicken dressers is necessary and desirable in the usual business of the respondent. LABOR RELATIONS Atty. Marquez Ruling: Article 280 of the Labor Code comprehends three kinds of employees: (a) regular employees or those whose work is necessary or desirable to the usual business of the employer. (2) if the employee has been performing the job for at least a year. because when the contract specifies the period of its duration. 1970. or any circumstances that vitiated their consent. and is a distributor of dressed chicken. The records reveal that the stipulations in the employment contracts were knowingly and voluntarily agreed to by the petitioners without force. packers and helpers at the Cainta Processing Plant. This employment contract shall be on a DAY-TO-DAY BASIS and shall not extend beyond the period specified therein. there was no illegal dismissal when the petitioners' services were terminated by reason of the expiration of their contracts. if his/her services are no longer needed. 158324. or if such services are found to be unsatisfactory.R. The petitioners were hired as "emergency workers" and assigned as chicken dressers. and. There are two separate instances whereby it can be determined that an employment is regular: (1) if the particular activity performed by the employee is necessary or desirable in the usual business or trade of the employer. That the employee hereby agrees to work in any work shift schedule that may be assigned to him by the Firm during the period of this contract. The respondent GMC is a domestic corporation engaged in the production and sale of livestock and poultry. unless sooner terminated for any of the causes above-cited. shall then automatically cease on its expiry date. As such. A contract for employment for a definite period terminates by its own term at the end of such period.

Ravago was granted a vacation leave with pay. and countenanced unwarranted discrimination when it ruled that petitioner cannot become a regular employee. (ETI). For this reason. this Court has consistently ruled that seafarers are contractual. making him walk with a limp. Page 42 . petitioner is governed by the Rules and Regulations Governing Overseas Employment and the said Rules do not provide for separation or termination pay. likewise. namely. the fact that Ravago was not rehired upon the completion of his contract did not result in his illegal dismissal. each for a fixed period. He was employed under a total of 34 separate and unconnected contracts. Shortly after completing his latest contract with EIS. damages and attorney's fees against Trans-Global and EIS with the Philippine Overseas Employment Administration Adjudication Office. that "at present. wherein it was ruled that seamen are contractual employees. Issue: Whether or not the Court of Appeals gravely erred. And in no case should the contract of seamen be longer than 12 months. Any extension of the Contract period shall be subject to the mutual consent of the parties. blatantly disregarded the constitutional mandate on protection to Filipino overseas workers. he was not entitled to reinstatement or payment of separation pay. v. After deducting his Social Security System and medical contributions. Respondents denied that Ravago was dismissed without notice and just cause. LABOR RELATIONS Atty. In Brent School. a stray bullet hit Ravago on the left leg while he was waiting for a bus ride in Cubao. Rather. Ravago's left leg had become apparently shorter. Singapore Branch." Ravago. C. The Standard Employment Contract governing the Employment of All Filipino Seamen on Board Ocean-Going Vessels of the POEA. Ltd. (EIS). instead of rehiring Ravago. Virginia G. for his continuous service. Consequently. he was assigned to work in different Esso vessels where he was designated diverse tasks. such as oiler. not regular. EEM and Esso International Shipping (Bahamas) Co. As a result of his injury. asserted that he was not a mere contractual employee because the respondents regularly and continuously rehired him for 23 years and. making him unfit to work once again as a seaman. Marquez his duty as S/N wiper on board the Esso Bataan under a contract that lasted until February 10. However. Esso Tankers. particularly in Part I. Inc. Zamora. National Labor Relations Commission. specifically provides that the contract of seamen shall be for a fixed period. Dr. Ravago worked with Esso vessels until August 22. by three different companies. a period spanning more than 22 years. one of his attending physicians at the Philippine Orthopedic Hospital. As a Filipino seaman.. hence.D. his services were no longer engaged in view of the disability he suffered which rendered him unfit to work as a seafarer. EIS remitted the net amount of P162. They averred that Ravago was a contractual employee and was hired under 34 separate contracts by different companies. Ravago insisted that he was fit to resume pre-injury activities as evidenced by the certification issued by Dr. backwages. found him to have lost his dexterity. He fractured his left proximal tibia and was hospitalized at the Philippine Orthopedic Hospital. fracture of tibia has completely healed and patient is fit to resume pre-injury activities anytime. Jefferson M. Quezon City. Sec.. then assistant engineer. In his position paper.232. EIS paid him his Career Employment Incentive Plan (CEIP) and his final tax refund for 1992. Manzo. Thereafter. According to the CA. The Court of Appeals decided that the employment status of seafarers has been established with finality by the Court's reconsideration of its decision in Millares v. Marciano Foronda M. One the night.65. the Court ruled that seamen and overseas contract workers are not covered by the term "regular employment" as defined in Article 280 of the Labor Code. Ravago filed a complaint for illegal dismissal with prayer for reinstatement. Ruling: In a catena of cases. Ravago's doctor opined that he would not be able to cope with the job of a seaman and suggested that he be given a desk job. 1971. employees. 1992. the company physician. was awarded a CEIP payment upon his termination from employment. following Ravago's execution of a Deed of Quitclaim and/or Release. It reads: Section C. Duration of Contract The period of employment shall be for a fixed period but in no case to exceed 12 months and shall be stated in the Crew Contract. Inc.

they can properly be classified as regular employees. such as cultivation. she issued the order giving preference to those who supported the re-classification. During the off milling season of 1996 he issued an Order or Notice which stated. They further alleged that they were dismissed because they applied as beneficiaries under the Comprehensive Agrarian Reform Program (CARP) over the land owned by petitioner Starke. No. simply does not allow for the respondents to work for a definite period only. planting of cane points. 2005. including the respondents. 10. Although the petitioners assert that the respondents made their services available to the neighboring haciendas. weeding. They allege that they are regular and permanent workers of the hacienda and that they were dismissed without just and lawful cause. Issue: Whether or not the respondents are regular employee? Ruling: It held that the ruling in Mercado. herein petitioner. the records do not. and so. on account of the seasonal nature of the work. that all Hacienda Employees who signed in favor of CARP are expressing their desire to get out of employment on their own volition and wherefore. However. Cuenca. Petitioner Starke alleged that in there was little work in the plantation as it was off-season. no proof that they Page 43 . Starke. Hence. The primary standard for determining regular employment is the reasonable connection between the particular activity performed by the employee in relation to the usual trade or business of the employer. the respondents refused to report back to work. Jefferson M. April 15. Their employment is contractually fixed for a certain period of time. is the owner and operator of the Hacienda Bino. fertilization. the work was plentiful again and she issued notices to all workers. They must have been employed only for the duration of one season. citing 2003 Hacienda Fatima Facts: Hortencia L. LABOR RELATIONS Atty. In this case. The petitioners did not present any evidence that the respondents were required to perform certain phases of agricultural work for a definite period of time. it is not enough that they perform work or services that are seasonal in nature. 150478. While the records sufficiently show that the respondents’ work in the hacienda was seasonal in nature. support such assertion. In the Mercado case. v. They fall under the exception of Article 280 whose employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season. G. after which they offer their services to other farm owners. informing them of the availability of work. however. Herein respondents are employees of the hacienda performing various works. considering that there are facts peculiar in that case which are not present in the case at bar. however. Marquez Their employment is governed by the contracts they sign every time they are rehired and their employment is terminated when the contract expires. NLRC does not operate to abandon the settled doctrine that sugar workers are considered regular and permanent farm workers of a sugar plantation owner.R. She pointed out that when the milling season began. harvesting and loading of harvested sugarcanes to cargo trucks are those who signed in favor of CARP. Sr. which is 236 hectares. Hacienda Bino/Hortencia Stark vs. there was. There is no doubt that the respondents were performing work necessary and desirable in the usual trade or business of an employer. For respondents to be excluded from those classified as regular employees. the area of the hacienda. only those who did not sign for CARP will be given employment by the hacienda. watering. the farm laborers worked only for a definite period for a farm owner since the area of the land was comparatively small.

on the rationale that as a “retained physician” under a valid contract mutually agreed upon by the parties. the payrolls. show that they availed the services of the respondents since 1991.R. In December 1996 Philcom. submitted in evidence by the petitioners. like any other regular employees of Philcom. G. thru a letter bearing on the subject boldly written as “TERMINATION – RETAINERSHIP CONTRACT”. LABOR RELATIONS Atty. Marquez were hired for the duration of one season only. via a letter offered his services to the petitioner. to include [CERTAIN TASKS]. On 15 May 1981. for the years 1995 and 1996. It bears stressing that the employer has the burden of proving the lawfulness of his employee’s dismissal. therefore. alleging that he had been actually employed by Philcom as its company physician since 1981 and was dismissed without due process. 11. 2005 Facts: Petitioner Philippine Global Communications. De Vera. Jefferson M.000. he did not give much attention to the designation as anyway he worked on a full-time basis and was paid a basic monthly salary plus fringe benefits. NLRC reversed on a finding that . Labor Arbiter dismissed De Vera’s complaint for lack of merit. while respondent Ricardo De Vera is a physician by profession whom petitioner enlisted to attend to the medical needs of its employees. 1996”. modifying that of the NLRC by deleting the award of traveling allowance. 1996” because management has decided that it would be more practical to provide medical services to its employees through accredited hospitals near the company premises. the general rule of regular employment should. 157214. He likewise professed that since he was not conversant with labor laws.00 a month. No. Absent any proof to the contrary. The retainership arrangement went on from 1981 to 1994 with changes in the retainer’s fee. Said contract was renewed yearly. Philcom then went to the Court of Appeals which rendered a decision. June 7. He averred that he was designated as a “company physician on retainer basis” for reasons allegedly known only to Philcom. De Vera was an “independent contractor” and that he “was not dismissed but rather his contract with [PHILCOM] ended when said contract was not renewed after December 31. De Vera. In fact. renewal of the contract was only made verbally. and ordering payment of separation pay to De Vera in lieu of reinstatement. The parties agreed and formalized respondent’s proposal in a document denominated as RETAINERSHIP CONTRACT–which will be for a period of one year subject to renewal. is a corporation engaged in the business of communication services and allied activities.De Vera is Philcom’s “regular employee” and accordingly directed the company to reinstate him to his former position without loss of seniority rights and privileges and with full backwages from the date of his dismissal until actual reinstatement. De Vera filed a complaint for illegal dismissal before the National Labor Relations Commission (NLRC). Phil Global Communication v. therein proposing his plan of works required of a practitioner in industrial medicine. Issue: Whether the case is one of a LEGITIMATE JOB CONTRACTING AGREEMENT Page 44 . stand. informed De Vera of its decision to discontinue the latter’s “retainer’s contract with the Company effective at the close of business hours of December 31. However. (PhilCom). and that respondent’s “retainer fee” will be at P4. Inc.

in itself. Jefferson M. Marquez or an EMPLOYER-EMPLOYEE RELATIONSHIP. As a literate person and educated person. APPLYING THE FOUR-FOLD TEST TO THIS CASE. as borne by no less than his own letter which was substantially the basis of the labor arbiter’s finding that –there existed no employer-employee relationship between petitioner and respondent in addition to the following factual settings: [AS TO SELECTION OR HIRING] The fact that –the complainant was not considered an employee was recognized by the complainant himself in a signed LETTER to the respondent. the complainant cannot claim that he does not know what contract he signed and that it was renewed on a year to year basis. The complainant is a Doctor of Medicine. If he were an employee he could not negotiate as to his hours of work. as he signed the same without any objections. An ordinary employee would consider the SSS payments important and thus make sure they would be paid. matters which are simply inconsistent with an employer-employee relationship. a question of fact well within the province of the NLRC. the existence of which is. given the reality that the NLRC’s findings are at odds with those of the labor arbiter. and the duration of the contract for one year is also clearly indicated in paragraph 5 of the Retainership Contract. The retainer fee is indicated on the RETAINERSHIP CONTRACT. This clearly shows that the complainant never considered himself an employee of PHILCOM and thus. The complainant cannot claim that he was unaware that the ‘contract’ was good only for one year. [AS TO WAGES] from the time he started to work with petitioner. respondent need not remit anything to the SSS in favor of the complainant. But he never raised those issues. and was in fact subjected by petitioner to the ten (10%) percent withholding tax for his professional fee. LABOR RELATIONS Atty. and presumably. he never was included in its payroll. This shows that the respondent PHILCOM did not have control over the schedule of the complainant as it [is] the complainant who is proposing his own schedule and asking to be paid for the same. Ruling: The primordial issue of whether an employer-employee relationship exists between petitioner and respondent. This is proof that the complainant understood that his relationship with the respondent PHILCOM was a retained physician and not as an employee. it was respondent himself who sets the parameters of what his duties would be in offering his services to petitioner. The complainant also accepted its renewal every year thereafter until 1994. The complainant never bothered to ask the respondent to remit his SSS contributions. was never deducted any contribution for remittance to the Social Security System (SSS).” Clearly. the elements of an employer-employee relationship are wanting in this case. the Court is constrained to look deeper into the attendant circumstances obtaining in this case. as appearing on record. Page 45 . a well-educated person. in accordance with the National Internal Revenue Code. The tenor of this letter indicates that –the complainant was proposing to extend his time with the respondent and seeking additional compensation for said extension. Nonetheless.

ARTICLE 280 OF THE LABOR CODE (sic) provides: ‘The provisions of written agreement to the contrary notwithstanding and regardless of the oral agreements of the parties. Either may terminate the arrangement at will. the position of company physician. EXCEPT where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season. the parties themselves practically agreed on every terms and conditions of respondent’s engagement.’ ‘An employment shall be deemed to be CASUAL if it is not covered by the preceding paragraph: Provided. not to mention the fact that respondent’s work hours and the additional compensation therefor were negotiated upon by the parties. In fact. with or without cause.’ Parenthetically. shall be considered a REGULAR with respect to the activity in which he is employed and his employment shall continue while such activity exists. it is necessary to have a physician at hand. any employee who has rendered at least one (1) year of service. whether such is continuous or broken. Marquez the records are replete with evidence showing that –respondent had to bill petitioner for his monthly professional fees. the importance and desirability of a physician in a company premises is recognized by Page 46 . respondent has never cited even a single instance when petitioner interfered with his work. In fine. He could even embark in the private practice of his profession. an employment shall be deemed to be REGULAR where the employee has been engaged to perform in the usual business or trade of the employer. Here. hence. remarkably absent from the parties’ arrangement is the ELEMENT OF CONTROL. [AS TO DISMISSAL] the power to terminate the parties’ relationship was mutually vested on both. is usually necessary and desirable because the need for medical attention of employees cannot be foreseen. For sure. petitioner had no control over the means and methods by which respondent went about performing his work at the company premises. It simply runs against the grain of common experience to imagine that – an ordinary employee has yet to bill his employer to receive his salary. LABOR RELATIONS Atty. That. whereby the employer has reserved the right to control the employee not only as to the result of the work done but also as to the means and methods by which the same is to be accomplished. Jefferson M. Finally. which thereby negates the element of control in their relationship. in the case of petitioner.

ARTICLE 280 OF THE LABOR CODE. Marquez ART. the very existence of an employment relationship is in dispute. that . provides that – the employer may engage the services of a physician and dentist “on retained basis”. not employ. the provision merely distinguishes between two (2) kinds of employees. as found by public respondent. to stress. regular and casual. The appellate court’s premise that –REGULAR EMPLOYEES are those who perform activities which are desirable and necessary for the business of the employer – is not determinative in this case. a part-time physician who needed to stay in the premises of the non-hazardous workplace for two (2) hours. we take it that any agreement may provide that – one party shall render services for and in behalf of another. Page 47 . petitioner employs more than 500 employees.e. ARTICLE 157 OF THE LABOR CODE clearly and unequivocally allows employers in non-hazardous establishments to engage “on retained basis” the service of a dentist or physician. no matter how necessary for the latter’s business. The very phrase that they may be engaged “on retained basis”. Nowhere does the law provide that the physician or dentist so engaged thereby becomes a regular employee. 157 OF THE LABOR CODE. what applies here is the last paragraph of Article 157 which.. For. Jefferson M. with or without cause. as shown by their various “retainership contracts”. This set-up is precisely true in the case of an INDEPENDENT CONTRACTORSHIP as well as in an AGENCY AGREEMENT. however. subject to such regulations as the Secretary of Labor may prescribe. as here. LABOR RELATIONS Atty. nothing is there in the law which says that medical practitioners so engaged be actually hired as employees.even as the contracts entered into by the parties invariably provide for a 60-DAY NOTICE REQUIREMENT prior to termination. It does not apply where. as written. to their retainership agreement as therein provided. adding that the law. The successive “retainership” agreements of the parties definitely hue to the very statutory provision relied upon by respondent. even without being hired as an employee. the same was not complied with by petitioner when it terminated the verbally-renewed retainership agreement. [MOOT AND ACADEMIC] We note. in petitioner’s case. As it is. revolts against the idea that this engagement gives rise to an employer-employee relationship. is not the yardstick for determining the existence of an employment relationship. so can petitioner put an end. only requires the employer “to retain”. ART. With the recognition of the fact that –petitioner consistently engaged the services of respondent on a retainer basis. i. 157 OF THE LABOR CODE while it is true that the provision requires employers to engage the services of medical practitioners in certain establishments depending on the number of their employees. which requires the presence of a physician depending on the number of employees and in the case at bench.

12. August 9. Petitioner was ordered to reinstate private respondent to his former position with full backwages from the time his salary was withheld until his actual reinstatement. National Labor Relations Commission and Glen Solon. while private respondent was about to log out from work. It filed an appeal before the CA but it was subsequently dismissed for lack of merit. Jefferson M. and pay him service incentive leave pay. Inc. NLRC 12 that the principal test in determining whether an employee is a "project employee" or "regular employee. whether he is assigned to carry out a "specific project or undertaking. HELD No. Integrated Contractor and Plumbing Works. 152427. the Labor Arbiter ruled that private respondent was a regular employee and could only be removed for cause. the 60-day notice requirement has become moot and academic if not waived by the respondent himself. He was considered as a regular employee.R. G. the petition is GRANTED and the challenged decision of the Court of Appeals REVERSED and SET ASIDE. To all intents and purposes. that execution of the NLRC decision had already been made at the NLRC despite the pendency of the present recourse. WHEREFORE. therefore. he was informed by the warehouseman that the main office had instructed them to tell him it was his last day of work as he had been terminated. the record shows. LABOR RELATIONS Atty. he found out that indeed. Its business depends on the number and frequency of the projects it is able to contract with its clients. 13 "Project" refers to a particular job or undertaking that is within the regular or usual business of the employer. No." the duration (and scope) of which are specified at the time the employee is engaged in the project. Issue: Whether the respondent is a project employee of the petitioner or a regular employee. 1998 to verify his status. For sure." is. he had been terminated. Such job or undertaking begins and ends at determined or determinable times. We held in Tomas Lao Construction v. Marquez Be that as it may. He filed a complaint alleging that he was illegally dismissed without just cause and without due process. On February 23. Petitioner further filed a motion for reconsideration which was denied. and 13th month pay for three years. When private respondent went to the petitioner's office on February 24. A review of private respondent's work assignments patently showed he belonged to a work pool tapped from where workers are and assigned Page 48 . 1998. accounts of petitioner had already been garnished and released to respondent despite the previous Status Quo Order[29] issued by this Court. The 21 December 1998 decision of the labor arbiter is REINSTATED. but which is distinct and separate and identifiable from the undertakings of the company. 2005 Facts: Petitioner is a plumbing contractor. and this is admitted by both parties. vs.

1990. 20 Where from the circumstances it is apparent that periods have been imposed to preclude the acquisition of tenurial security by the employee. Thereafter. it is vital in determining if the employee was hired for a specific undertaking or tasked to perform functions vital. re-hired by the same employer for the same tasks or nature of tasks. 1990 until March 31. 20 also expressly provides that the report of termination is one of the indications of project employment. LABOR RELATIONS Atty. Ateneo de Manila. They are like regular seasonal workers insofar as the effect of temporary cessation of work is concerned. This arrangement is beneficial to both the employer and employee for it prevents the unjust situation of "coddling labor at the expense of capital" and at the same time enables the workers to attain the status of regular employees. The failure of the employer to file termination reports is an indication that the employee is not a project employee. G. Jefferson M. 19 superseding Policy Instructions No. even if the performance is not continuous or merely intermittent. She was re-hired. and moral and exemplary damages. Garcia. then the employee must be deemed a regular employee. 1991 until March 31. 24 If private respondent was a project employee. Also. we held that where the employment of project employees is extended long after the supposed project has been finished. still on a contractual basis. 2005 Facts: Respondent Ateneo de Manila University (Ateneo) hired. on a contractual basis. not the Page 49 . Lacuesta vs. 23 In the case at bar. they should be struck down as contrary to public policy. 152777. good customs or public order. No. During these three years she was on probation status. NLRC we ruled that once a project or work pool employee has been: (1) continuously. the workers do not receive salaries and are free to seek other employment during temporary breaks in the business. Lacuesta as a part-time lecturer in its English Department for the second semester of school year 1988-1989. 22 Department Order No. the law deems the repeated and continuing need for its performance as sufficient evidence of the necessity. morals. The test to determine whether employment is regular or not is the reasonable connection between the particular activity performed by the employee in relation to the usual business or trade of the employer. Jr. there was only one list of terminated workers submitted to the Department of Labor and Employment. 1993. and (2) these tasks are vital. back wages. December 9. 20 requires employers to submit a report of an employee's termination to the nearest public employment office every time his employment was terminated due to a completion of a project. Policy Instructions No. if not indispensability of that activity to the business. petitioner should have submitted a termination report for every completion of a project to which the former was assigned. the petitioner was first appointed as full-time instructor on probation. necessary and indispensable to the usual business or trade of the employer. her contract as faculty on probation was renewed effective April 1. notified petitioner that her contract would no longer be renewed because she did not integrate well with the English Department. if the employee has been performing the job for at least one year. necessary and indispensable to the usual business or trade of the employer. 1992. as opposed to intermittently. Marquez whenever their services were needed. for the first and second semesters of school year 1989-1990. the pattern of re-hiring and the recurring need for his services are sufficient evidence of the necessity and indispensability of such services to petitioner's business or trade. In a work pool. 15 Nonetheless. While length of time may not be the controlling test for project employment. In Maraguinot. She was again hired for a third year effective April 1. the employees are removed from the scope of project employees and are considered regular employees.R. Thus. His employment ceased to be coterminous with specific projects when he was repeatedly re-hired due to the demands of petitioner's business. Leovino Ma. in the same department effective June 1.Petitioner filed a complaint for illegal dismissal with prayer for reinstatement. Here. Further. 13. On July 13. Respondent Dr. 1992 until March 31. v. 1991. Dean of Ateneo’s Graduate School and College of Arts and Sciences. petitioner Lolita R. She contends that Articles 280 and 281 of the Labor Code. private respondent had been a project employee several times over.

Whether or not the Court of Appeals erred in ruling that it is the Manual of Regulations For Private Schools. the decision to re-hire an employee on probation. NLRC. (2) the teacher must have rendered three consecutive years of service. for those teaching in the tertiary level. “the probationary employment of professors. and not the Labor Code. not the Labor Code. And completing the probation period does not automatically qualify her to become a permanent employee of the university. and (3) such service must have been satisfactory. (2) under Article 280. February 20. probationary employment shall not exceed six (6) months from date of employment unless a longer period had been stipulated by an apprenticeship agreement. is the applicable law to determine whether or not an employee in an educational institution has acquired regular or permanent status. LABOR RELATIONS Atty. are (1) the teacher is a full-time teacher. A part-time teacher cannot acquire permanent status. The Manual of Regulations for Private Schools. Rulings: 1. if the apprenticeship agreement stipulates a period longer than one year and the employee rendered at least one year of service. Consistent with academic freedom and constitutional autonomy. Thus. Under Policy Instructions No. Only when one has served as a full-time teacher can he acquire permanent or regular status. the three semesters she served as part-time lecturer could not be credited to her in computing the number of years she has served to qualify her for permanent status. She argues that (1) under Article 281.” Section 93of the 1992 Manual of Regulations for Private Schools provides that full-time teachers who have satisfactorily completed their probationary period shall be considered regular or permanent. The petitioner was a part-time lecturer before she was appointed as a full-time instructor on probation. petitioner already acquired permanent status. Petitioner could only qualify to become a permanent employee upon fulfilling the reasonable standards for permanent employment as faculty member. No. 2. Issues: 1. and (3) it is with more reason that petitioner be made regular since she had rendered services as part-time and full-time English teacher for four and a half years. Whether or not after completing the three-year probation with an above-average performance.At the end of the probation period.The requisites to acquire permanent employment. the probationary period shall not be more than six consecutive regular semesters of satisfactory service. determines whether or not a faculty member in an educational institution has attained regular or permanent status. services which are necessary and desirable to the usual business of Ateneo. an institution of higher learning has the prerogative to provide standards for its teachers and determine whether these standards have been met. Jefferson M. 11 issued by the Department of Labor and Employment. the employee shall be considered as regular employee with respect to the activity in which he is employed while such activity exists. her employment as such had ended when her contract expired. As a part-time lecturer.R. that determines the acquisition of regular or permanent status of faculty members in an educational institution. Moreover. 14. Poseidon Fishing/Terry De Jesus v. instructors and teachers shall be subject to the standards established by the Department of Education and Culture. belongs to the university as the employer alone. 168052. 2. or security of tenure. G. Marquez Manual of Regulations for Private Schools. 2006 Page 50 . whether continuous or broken.

necessary and important to the business of his employer. There is nothing in the contract that says complainant is a casual. As a Radio Operator. and later as Radio Operator. He was promoted to Boat Captain but was later demoted to Radio Operator. On the same day. Marquez Facts: Petitioner Poseidon Fishing is a fishing company engaged in the deep-sea fishing industry with Terry de Jesus as the manager. and 2) those who have rendered at least one year of service whether such service is continuous or broken. The date July 1 to 31. 1998 under the heading "Pagdating" had been placed there merely to indicate the possible date of arrival of the vessel and is not an indication of the status of employment of the crew of the vessel.m. Eustoquia was a regular employee. LABOR RELATIONS Atty. His work was. Jefferson M. Poseidon and Terry de Jesus asserted that Estoquia was a contractual or a casual employee employed only on a"por viaje" or per trip basis and that his employment would be terminated at the end of the trip for which he was being hired. then Boat Captain. Estoquia was asked to prepare an incident report to explain the reason for the said oversight. seasonal or a project worker. call after the 7:30 a. Estoquia was employed as Chief Mate in January 1988 and after five years. The provision enumerates two (2) kinds of employees. petitioner detected the error in the entry in the logbook. Eustoquia worked for petitioner first as a Chief Mate. he noticed that he was not able to record the said call in one of the logbooks so he immediately recorded the 7:25 a. the regular employees and the casual employees. In the morning of 4 July 2000. Poseidon’s secretary summoned Estoquia to get his separation pay Estoquia filed a complaint for illegal dismissal with the Labor Arbiter. therefore. entry. call in one of the logbooks. Such being the scenario involved. In a span of 12 years.m. Issue:S: WON Eustoqia was a regular employee WON deep -sea fishing is a seasonal industry WON Eustoqia was illegally dismissed Ruling: Yes. The regular employees consist of the following: 1) those engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer. he monitored the daily activities in their office and recorded in the duty logbook the names of the callers and time of their calls. Page 51 . Estoquia failed to record a 7:25 a. there was a provision stating that he was being employed only on a ‘’por viaje’’ basis and that his employment would be terminated at the end of the trip for which he was being hired. His job was directly related to the deep-sea fishing business of petitioner Poseidon. Eustoquia is considered a regular employee. Article 280 draws a line between regular and casual employment. When he reviewed the two logbooks. On 3 July 2000. Jimmy S.m. The contract with Eustoqia per the "Kasunduan".

Once a project or work pool employee has been: (1) continuously. Such pattern of re-hiring and the recurring need for his services are testament to the necessity and indispensability of such services to petitioners’ business or trade. in the performance of his duties to warrant a reduction of six months salary and be summarily dismissed. The principal test for determining whether particular employees are "project employees" as distinguished from "regular employees. re-hired by the same employer for the same tasks or nature of tasks. Eustoquia was never informed that he will be assigned to a "specific project or undertaking” at the time of their engagement. and (2) the completion or termination of such project has been determined at the time of the engagement of the employee. the worker is entitled to back wages and other similar benefits without deductions or conditions. necessary and indispensable to the usual business or trade of the employer. if the employee has been performing the job for at least one year. Marquez The test to determine whether employment is regular or not is the reasonable connection between the particular activity performed by the employee in relation to the usual business or trade of the employer. as opposed to intermittently." is whether or not the "project employees" were assigned to carry out a "specific project or undertaking. the law deems the repeated and continuing need for its performance as sufficient evidence of the necessity. the activity of catching fish is a continuous process and could hardly be considered as seasonal in nature. His dismissal was without valid cause and where illegal dismissal is proven. And. No. Yes. Hence. Page 52 . LABOR RELATIONS Atty. There is no sufficient evidence on record to prove Eustoqia’s negligence. he was of regular employee. and (2) these tasks are vital. gross or simple. the simple negligence is punishable only with admonition or suspension for a day or two. Jefferson M. Project employees is defined as those workers hired: (1) for a specific project or undertaking. Eustoquia’s functions were usually necessary or desirable in the usual business or trade of petitioner fishing company and he was hired continuously for 12 years for the same nature of tasks. At best. then the employee must be deemed a regular employee. Eustoqia was illegally dismissed. if not indispensability of that activity to the business." the duration and scope of which were specified at the time the employees were engaged for that project. the act of hiring and re-hiring in various capacities is a mere gambit employed by petitioner to thwart the tenurial protection of private respondent. In the case at bar. even if the performance is not continuous or merely intermittent. In this case.

The supply of scrap metal is not steady as it depends upon many factors. whose salaries are paid directly by its main office in Cebu. There are weeks were there are no delivery while there are weeks were a quite of number of trucks are delivered to the stockyard. Jefferson M. CA dismissed the petition for petitioner is barred from raising a new defense at this stage of the case. In the Bacolod branch it has (3) regular employees holding such positions as Officer-in-Charge. Petition is denied. Gregorio Saliling. rest days. September 5. who would enjoy security of tenure and entitlement of separation pay.R. Sometimes. Abesco Construction vs. Benjie Amparado are the one who undertakes pakiao work in the unloading of scrap iron. 16. April 10. road roller operators. LABOR RELATIONS Atty. The Bacolod buying station is mainly a stockyard where scrap metal delivered by its suppliers are stockpiled. Marquez 15. and moral and exemplary damages. Petitioners alleged that respondents were only project employees whose employment was coterminous with the project they are assigned. Manuel Alquiza. No. such as availability of supplies.R. The complainants. LA declared judgment declaring respondents as regular employees belonged to a “workpool” and where hired and rehired over a period of 18 years and petitioners are guilty of illegal dismissal. These trucks have their own driver and truck boys employed by the different suppliers. Saliling. They were not regular employees. 5-days’ service incentive leave pay. Petitioner then file petition for review to CA alleging that they were not guilty of illegal dismissal since respondents’ services were merely put on hold until the resumption of their business operations. Ruling: Respondents are regular employees. (2) a notice advising them of the decision to terminate the employment. vs. competition and demand among others. G. 2006 Facts: Petitioner company was engaged in a construction business where respondents where hired on different dates from 1976 to 1992 either as laborers. and a yardman. Duration as well as particular work/service to be performed must be defined in an Employment Agreement and is made clear to the employees at the time of hiring. 2006 Facts: Cebu Metal Corporation is a corporation engaged in buying and selling of scrap iron. Petitioner appealed to NLRC which affirmed LA’s decision. The complaints included claims for non-payment of 13th month pay. Issue: Whether or not respondents are project employees or regular employees. G. painters or drivers. these trucks do not have any Page 53 . 154463. Petitioner failed to adhere the two-notice rule: (1) a notice informing them of the particular acts for which they are being dismissed and. No. Respondents filed two separate complaints for illegal dismissal against the company and its General Manager before Labor Arbiter. price.. Petitioners inconsistent and conflicting position on their true relation with the respondents made it all the more evident that the latter were indeed their regular employees. a scaler. Ramirez. Petitioners failed to comply with this requirement. premium pay for holidays. Cebu Metal Corp. Respondents were never given such notices. Elias Bolido. The arrivals of these trucks and the deliveries of scrap metal iron are not regular and the schedules of deliveries to the stockyard are not known before hand by the respondent Cebu Metal Corporation. 141168.

1997 a complaint with the regional arbitration in Bacolod City for underpayment of wages and non-payment of the following benefits 1. They were then free to offer their services to others. the applicable law. The Labor Arbiter rendered a decision in favor of the complainants. It is this leader who distributes the individual takes of each member of the particular group unloading the scrap metal from a particular work The complainants maintained that they are hired by Cebu Metal Corparation as employees and filed on January 10. And whenever required. and in these instances. nevertheless mandates the policy of social justice so as to strike a balance between an avowed predilection for labor. on the one hand. 159682. thus. October 17. petitioner's employment was terminated on 30 October 1999. the latter’s working relationship with Cebu Metal Corporation legally ended. and it rendered the decision annulling the decision of the NLRC and reinstated the decision made by the Labor Arbiter. No. Usually. quite telling is the fact that not every truck delivery of scrap metal requires the services of respondent complainants when particular truck is accompanied by its own unloader. On March 6. service incentive leave pay.R. the corporation hires the services of people for the unloading of the scrap metal from these trucks.. there is a leader for a particular group who is tasked to unload the scrap metal from a particular truck. Hence. Besides. RBL Shipyard Corp. 1998 includes the claim for illegal dismissal because they were dismissed after the filing of the complaint. an existing jurisprudence. 17. holiday pay. This is confirmed in the Petty Cash Vouchers which are in the names of different leaders who are apportion the amount earned among its members. they could not have been illegally dismissed. Jefferson M. it necessarily follows that after the job of unloading was completed and unloaders are paid the contract price. 13th month pay. Cebu Metal Corporation filed an appeal with the NLRC.00 per metric ton. And. Ruling: The Supreme Court ruled there can be no illegal dismissal to speak of. 2. 3. and the maintenance of the legal rights of capital. The NLRC reversed and set aside the decision of the Labor Arbiter and held that the complainants were not regular employees. respondent complainants were not always the ones contracted to undertake the unloading of the trucks since the work was offered to whomever were available at a given time. this petition. LABOR RELATIONS Atty. Indeed we should not be mindful of the legal norm that justice is in every case for the deserving. the complainants cannot claim regularity in the hiring every time a truck comes loaded with scrap metal. The Commission further rationalized that with the irregular nature of the work involved in the stoppage and resumption of which depended solely on the availability or supply of scrap metal. Marquez truck boys. Issue: Whether or not the complainant respondents are regular employees. the proverbial hen that lays the golden egg. It should be remembered that the Philippine Constitution. They are hired whenever there are trucks of suppliers do not have any accompanying truck boys. It is for this reason that the unloaders hired by the respondent to unload are basically seasonal workers. 2006 Facts: After working as a carpenter for respondent since August 1991. Aggrieved. while inexorably committed towards the protection of the working class from exploitation and unfair treatment. Such event Page 54 . on the other. Liganza v. G. to be dispensed with in the light of established facts. The complainants challenged the decision of the NLRC with the Court of Appeals. The order of the reversal was based on the Commission’s finding that the petty cash vouchers submitted by Cebu Metal Corporation confirmed the fact that unloaders were paid on “pakiao” or task basis at Php 15. Whoever is available and whoever are willing to help unload on a particular occasion are hired to unload.

Respondent failed to present the contracts purportedly covering petitioner's employment from 1991 to July 1997. Such contention is clearly unconvincing. In termination cases. v. the Page 55 . This Court has held that an employment ceases to be co-terminous with specific projects when the employee is continuously rehired due to the demands of employer's business and re-engaged for many more projects without interruption. Thus. respondent claims that the records and contracts covering said period were destroyed by rains and flashfloods that hit the company's office. A certificate from the owner of the vessel serviced by the company. a report must be made to the nearest employment office of the termination of the services of the workers every time it completed a project. the burden of proof rests on the employer to show that the dismissal is for a just cause. the completion or termination of which has been determined at the time of the engagement of the employee or where the work or service to be performed is seasonal in nature and the employment is for the duration of the season. Issue: 1. respondent seeks to prove the status of petitioner's employment through four (4) employment contracts covering a period of only two (2) years to declare petitioner as a project employee. NLRC (Second Division). While it is true that the employment contract states that the contract ends upon a specific date. Jr. Even assuming that petitioner is a project employee. However. respondent insisted that petitioner was a mere project employee who was terminated upon completion of the project for which he was hired. respondent failed to prove that his termination was for a just and valid cause. In Maraguinot. Whether or not the Court of Appeals seriously erred in concluding that "petitioner is a project employee. While the appropriate evidence to show that a person is a project employee is the employment contract specifying the project and the duration of such project. A project employee is one whose "employment has been fixed for a specific project or undertaking. the existence of such contract is not always conclusive of the nature of one's employment. Respondent could have easily proved that the project or phase for which petitioner was hired has already been completed." Before an employee hired on a per project basis can be dismissed. or upon completion of the project. Marquez prompted petitioner to file a complaint for illegal dismissal. all that we have is respondent's self-serving assertion that the project has been completed. 20. LABOR RELATIONS Atty. and other proof of completion could have been procured by respondent. he was told to look for another job. To explain its failure in this regard. not a regular employee? Ruling: Petitioner is a regular employee. he claimed that he was unceremoniously terminated from employment without any valid or authorized cause. On the same occasion. pictures perhaps. On the other hand. In the instant case. pursuant to Policy Instruction No. of the work accomplished. spanning six (6) years of the total eight (8) years of his employment. Jefferson M. respondent failed to prove that the last project was indeed completed so as to justify petitioner's termination from employment. alleging that on said date he was verbally informed that he was already terminated from employment and barred from entering the premises.

rehired by the same employer for the same tasks or nature of tasks. as carpenter. morals. Respondent capitalizes on our ruling in D. they should be struck down as contrary to public policy. doors. pursuant to Article 280 of the Labor Code and jurisprudence. 150658. the services of petitioners. Where from the circumstances it is apparent that periods have been imposed to preclude the acquisition of tenurial security by the employee.R. good customs or public order. The 22 February 2001 Decision of the Labor Arbiter is REINSTATED. kitchen and other parts of the vessel that needs to be repaired. All considered. ceiling. February 9. SMC and its co-respondent Arman Hicarte. the repeated re-hiring and continuing need for his services for over eight (8) years have undeniably made him a regular employee. as opposed to intermittently. LABOR RELATIONS Atty. No. necessary and indispensable to the usual business or trade of the employer. were terminated after SMC no longer agreed to forge another contract with them. and (2) these tasks are vital. as the same was merely occasioned by the need to fill in a vacuum arising from SMC’s gradual transition to a new system of selling Page 56 ." Petitioner. windows. These doubts shall be resolved in favor of petitioner. without granting that petitioner was initially hired for specific projects or undertakings. length of time is not the controlling test for project employment. Fabeza v. flooring. In the case at bar.. quarters. it is vital in determining if the employee was hired for a specific undertaking or tasked to perform functions vital. who was its Human Resources Manager.M." After having entered into successive contracts of the same nature with SMC. in line with the policy of the law to afford protection to labor and construe doubts in favor of labor. petitioner's work was necessary or desirable to respondent's business. 2007 Facts: Petitioners were hired by respondent San Miguel Corporation (SMC) as "Relief Salesmen" for the Greater Manila Area (GMA) under separate but almost similarly worded "Contracts of Employment With Fixed Period." Surely. v. there are serious doubts in the evidence on record that petitioner is a project employee. NLRC27 which reiterates the rule that the length of service of a project employee is not the controlling test of employment tenure but whether or not "the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee. Consunji. 18. was tasked to "make and repair cabinet. Marquez Court ruled that "once a project or work pool employee has been: (1) continuously. Inc. Jefferson M. G. respondent had been a project employee several times over." As such. necessary and indispensable to the usual business or trade of the employer. Nevertheless. His employment ceased to be coterminous with specific projects when he was repeatedly re-hired due to the demands of petitioner's business. WHEREFORE. or that he was terminated for just cause. the petition is GRANTED and the challenged decision of the Court of Appeals is REVERSED and SET ASIDE. claimed that the hiring of petitioners was not intended to be permanent. Assuming. then the employee must be deemed a regular employee. as well as de Lara and Alovera. San Miguel Corp.

Inc. an employment shall be deemed to be regular where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer. Court of Appeals reversed the decision of the Labor Arbiter and of the NLRC Issue: WON the termination of the petitioners is valid. Marquez and delivering its products. v. the hiring of petitioners and others for a fixed period. While some of the qualified regular salesmen were readily upgraded to the position of Accounts Specialist. namely: (1) those who are engaged to perform activities which are necessary or desirable in the usual business or trade of the employer. – The provisions of written agreement to the contrary notwithstanding and regardless of the oral agreement of the parties. without any force. Supreme Court held that under the above-quoted provision. It should have no application to instances where a fixed period of employment was agreed upon knowingly and voluntarily by the parties. The Labor Arbiter held petitioners were illegally dismissed. LABOR RELATIONS Atty. whether continuous or broken. In Pure Foods Corp. except where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season. v. and (2) those casual employees who have rendered at least one year of service. Regular and casual employment. there are two kinds of regular employees. and the members of the regular Route Crew then existing were required to undergo a training program to determine whether they possessed or could be trained for the necessary attitude and aptitude required of an Accounts Specialist. respondents claimed that SMC still had to sell its beer products using the conventional routing system during the transition stage. Jefferson M. In Brent School. hence. the Supreme Court laid out that Article 280 of the Labor Code appears to prevent circumvention of the employee’s right to be secure in his tenure. co-terminus with the completion of the transition period and Training Program for all prospective Accounts Specialists The petitioners alleged that they were illegally dismissed by SMC. duress or improper pressure being brought to bear upon the employee and absent any other circumstances vitiating his consent. Page 57 . thus giving rise to the need for temporary employees. the clause in said article indiscriminately and completely ruling out all written or oral agreements conflicting with the concept of regular employment as defined therein should be construed to refer to the substantive evil that the Code itself has singled out: agreements entered into precisely to circumvent security of tenure. or where it satisfactorily appears that the employer and employee dealt with each other on more or less equal terms with no moral dominance whatever being exercised by the former over the latter. NLRC. The Decision of the Labor Arbiter was affirmed on appeal by the NLRC. Ruling: Article 280 of the Labor Code defines regular employment as follows: ART. with respect to the activity in which they are employed. 280. Zamora.

It is evident from the foregoing facts that respondent PLDT’s utilization of high technology equipment in its operation such as computers and digital switches necessarily resulted in the reduction of the demand for the services of a Switchman since computers and digital switches can aptly perform the function of several Switchmen.10 They requested the respondent PLDT for transfer to some vacant positions but their requests were denied since all positions were already filled up. Benjamin. The records show that respondent PLDT had sufficiently established the existence of redundancy in the position of Switchman. Hence. It is clear that the foregoing documentary evidence constituted substantial evidence to support the findings of Labor Arbiter Lustria and the NLRC that petitioner’s employment was terminated by respondent PLDT due to a valid or legal redundancy program since substantial evidence merely refers to that amount of evidence which a reasonable mind might accept as adequate to support a conclusion. respondent PLDT dismissed the four from employment. 19. petitioner. duress or improper pressure having been exerted against them is in order. Jefferson M. a determination of whether petitioners were hired as project or seasonal employees. then indeed their termination follows from the expiration of their contracts. G. Subsequently. and the Court of Appeals all found that substantial evidence supports the absence of illegal dismissal in the present case. the position of Switchman has become redundant. In November 1995. was elevated to the position of Frameman. Moreover. 165594. The NLRC had sufficient basis to believe that the shift of SMC to the Pre-Selling System was not the real basis for the forging of fixed-term contracts of employment with petitioners and that the periods were fixed only as a means to preclude petitioners from acquiring security of tenure. After participating in several trainings and seminars. on the other hand. As to whether Lazam was competent to testify on the effects of respondent PLDT’s adoption of new technology vis-à-vis the petitioner’s position of Switchman. Indubitably. Soriano vs. That petitioners themselves insisted on the one-year fixed-term is not even alleged by respondents. and Noel Apostol (Apostol) were employed by the respondent as Switchman Helpers in its Tondo Exchange Office (TEO). If petitioners fall under any of these categories. 2007. Maximino Gonzales (Gonzales). the records show that Lazam was highly qualified to do so. respondent PLDT implemented a company-wide redundancy program. on 16 August 1996. NLRC. the NLRC. Gonzales. Apostol. In fact. which is not in the nature of a project employment. One of their duties as Switchmen and Frameman was the manual operation and maintenance of the Electronic Mechanical Device (EMD) of the TEO. Ruling: The Labor Arbiter. Benjamin. and Gonzales were promoted as Switchmen. and Apostol informing them that their respective positions were deemed redundant due to the above-cited reasons and that their services will be terminated on 16 August 1996. Marquez Since respondents attribute the termination of petitioners’ employment to the expiration of their respective contracts. April 23. the sustained desire of each of the petitioners to enter into another employment contract upon the termination of the earlier ones clearly indicates their interest in continuing to work for SMC.R. System (Filisystem) Facts: Petitioner and certain individuals namely Sergio Benjamin (Benjamin). LABOR RELATIONS Atty. or as fixed-term employees without any force. He is a licensed electrical engineer and has been Page 58 . The same provision also states the procedural requirements for the validity of the dismissal. required a definite date of termination as a sine qua non. the respondent PLDT gave separate letters dated 15 July 1996 to petitioner. citing 2005 Filipina Pre-fabricated Bldg. respondents have not established that the engagement of petitioners’ services. No. Article 283 of the Labor Code provides that an employer may dismiss from work an employee by reason of redundancy.

. 280. and such determination was made in good faith and in furtherance of its business interest. Jefferson M. an employment shall be deemed to be regular where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer. Petitioners' contracts were renewed from time to time. – The provision of written agreement to the contrary notwithstanding and regardless of the oral agreement of the parties. Marquez employed by the respondent PLDT since 1971. the petition is DENIED. such hiring was intended solely for winding up operations using the old system. Petitioners filed a complaint for illegal dismissal.. et al. As amply stated by the respondent PLDT. Pedy Caseres (petitioner Caseres) started working for respondent in 1989. whether such service is continuous or broken. LABOR RELATIONS Atty. No. damages and attorney’s fees. Issue: Whether or not the petitioners are seasonal/project/term employees and not regular employees of respondents Ruling: Article 280 of the Labor Code provides: ART. any employee who has rendered at least one year of service. At the start of their respective employments. except where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season. That. they were made to sign a Contract of Employment for Specific Project or Undertaking. Universal Robina Sugar Milling Corp. G. 159343. 20. WHEREFORE. 13th month pay. September 28. SO ORDERED. Since the respondent PLDT determined that petitioner’s services are no longer necessary either as a Switchman or in any other position. He was also a training instructor of Switchmen in the respondent’s office. and had attended multiple training programs on Electronic Switching Systems in progressive countries. regularization. The foregoing provision provides for three kinds of employees: (a) regular employees or those who have been “engaged to perform activities Page 59 . Caseres vs.R. An employment shall be deemed to be casual if it is not covered by the preceding paragraph: Provided. 2007 Facts: Universal Robina Sugar Milling Corporation (respondent) is a corporation engaged in the cane sugar milling business. The fact that respondent PLDT hired contractual employees after implementing its redundancy program does not necessarily negate the existence of redundancy. while Andito Pael (petitioner Pael) in 1993. He was a Senior Manager for Switching Division in several offices of the respondent PLDT. Regular and Casual Employees. shall be considered a regular employee with respect to the activity in which he is employed and his employment shall continue while such actually exists. until May 1999 when they were informed that their contracts will not be renewed anymore. the petitioner’s contention that he should be the last switchman to be laid-off by reason of his qualifications and outstanding work must fail. incentive leave pay.

Finally. Marquez which are usually necessary or desirable in the usual business or trade of the employer”. The NLRC. (b) project employees or those “whose employment has been fixed for a specific project or undertaking. After an absence of more than five (5) months. would clearly reveal that the very nature of the terms and conditions of their hiring would show that complainants were required to perform phases of special projects which are not related to the main operation of the respondent for a definite period. x x x it is clear that the contracts of employment are valid and binding on the complainants. Upon application. Petitioners' repeated and successive re-employment on the basis of a contract of employment for more than one year cannot and does not make them regular employees. As in the first contract. Caseres was interviewed and made to understand that his employment would be co-terminus with the phase of work to which he would be then assigned. the completion or termination of which has been determined at the time of the engagement of the employee or where the work or service to be performed is seasonal in nature and the employment is for the duration of the season. Neither was there any showing that respondents exercised moral dominance on the complainants. This is so because the planting of sugar does not entail a whole year operation. The nature and terms and conditions of employment of petitioner Andito Pael were the same as that of his co-petitioner Caseres. Petitioners contend that respondent's repeated hiring of their services qualifies them to the status of regular employees. NLRC. after which their services are available to any farm owner. further ruled that: In the case at bar. The very nature of the terms and conditions of complainants' hiring reveals that they were required to perform phases of special projects for a definite period after. Caseres agreed and signed the contract of employment for specific project or undertaking. the employment of URSUMCO's work force was not permanent but co-terminous with the projects to which the employees were assigned and from whose payrolls they were paid (Palomares vs. 1989 as a worker assisting the crane operator at the transloading station. Length of service is not the controlling determinant of the employment tenure of a project employee (Rada vs. the CA noted: Petitioner Pedy Caseres first applied with private respondent URSUMCO on January 9. It should be stressed that contracts for project employment are valid under the law. Caseres' services were co-terminus with the work to which he was assigned. NLRC. he was free to seek employment with other sugar millers or elsewhere. Caseres re-applied with respondent as a seasonal project worker assisting in the general underchassis reconditioning to transport units on July 17. National Labor Relations Page 60 . LABOR RELATIONS Atty. In Villa v. Consequently. and utility works are comparatively small during the off-milling season. A project employee is one whose employment has been fixed for a specific project or undertaking. agreeing with the LA. and that thereafter. the completion or termination of which has been determined at the time of the engagement of the employee. We note that complainants never bothered to deny that they voluntarily. 1989 and that thereafter he is free to seek employment elsewhere to which Caseres agreed and readily signed the contract of employment for specific project or undertaking issued to him. It must be noted that there were intervals in petitioners' respective employment contracts. The execution of these contracts in the case at bar is necessitated by the peculiar nature of the work in the sugar industry which has an off milling season. and that their work depended on the availability of such contracts or projects. that is until February 5. the completion or termination of which has been determined at the time of the engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season”. Caseres was made to understand that his services would be co-terminus with the work to which he would be then assigned that is from July 17. and be informed thereof at the time of hiring. 205 SCRA 69). The principal test for determining whether an employee is a project employee or a regular employee is whether the employment has been fixed for a specific project or undertaking. Like his first assignment. and (c) casual employees or those who are neither regular nor project employees. On this score. 1989 and thereafter he would be free to seek employment elsewhere. A true project employee should be assigned to a project which begins and ends at determined or determinable times. Jefferson M. knowingly and willfully executed the contracts of employment. their services are available to other farm owners. 1989 to July 20. the LA ruled: This is further buttressed by the fact that the relationship between complainants and the respondent URSUMCO. 277 SCRA 439). Thereafter Caseres voluntarily signed several other employment contracts for various undertakings with a determinable period. 1989.

December 1999 (4 months) 21 days January . Inc.[16] the Court stated that: by entering into such contract. an employee is deemed to understand that his employment is coterminous with the project. necessarily the employment of respondent’s work force was not permanent but co-terminous with the projects to which they were assigned and from whose payrolls they were paid. his employment never lasted for more than a month at a time. Further. 21. while his employment lasted from August 1989 to May 1999. petitioners cannot complain of illegal dismissal inasmuch as the completion of the contract or phase thereof for which they have been engaged automatically terminates their employment. National Labor Relations Commission. It is of judicial notice that project employees engaged for manual services or those for special skills like those of carpenters or masons. PASSI has been rendering arrastre and stevedoring services at the port area since 1974 and employs stevedores who assist in the loading and unloading of cargoes to and from the vessels. as a rule. Project employment contracts are not lopsided agreements in favor of only one party thereto. These support the conclusion that they were indeed project employees. stating that an employee who has rendered service for at least one (1) year shall be considered a regular employee. are. Marquez Commission. this fact alone is not a valid reason for bestowing special treatment on them or for invalidating a contract of employment. but whether the employment has been fixed for a specific project or undertaking.R. The facts show that respondent rendered actual services to PASSI during the following periods: Period Duration September . still it did not qualify them as regular employees. The employer’s interest is equally important as that of the employee’s for theirs is the interest that propels economic activity. Neither is the employee left helpless by a prejudicial employment contract. As ruled in Palomares v. under the law. With regard to petitioner Pael. In petitioner Caseres's case. LABOR RELATIONS Atty. 2007 Facts: Petitioner Pier 8 Arrastre and Stevedoring Services. He may not expect to be employed continuously beyond the completion of the project. and such successive employments were not continuous. prejudice the employee. its completion has been determined at the time of the engagement of the employee. No. it would be extremely burdensome for their employer to retain them as permanent employees and pay them wages even if there were no projects to work on. of necessity. even if petitioners were repeatedly and successively re-hired. pertains to casual employees and not to project employees. Inc. vs Boclot. September 28. Cruz is its Vice-President and General Manager.December 2001 (10 months) 85 days January . unschooled. as length of service is not the controlling determinant of the employment tenure of a project employee. the proviso in Article 280. and since their work depended on the availability of such contracts or projects. Boclot was hired by PASSI to perform the functions of a stevedore starting 20 September 1999. Respondent Jeff B.5 days January . 173849. After all. G. Petitioner Eliodoro C.June 2003 (6 months) 32 days Page 61 . the interest of the worker is paramount.December 2002 (12 months) 70. (PASSI) is a domestic corporation engaged in the business of providing arrastre and stevedoring services[5] at Pier 8 in the Manila North Harbor. While it may be true that it is the employer who drafts project employment contracts with its business interest as overriding consideration. Moreover.April 2000 (4 months) 20 days March . Jefferson M. However. The fact that petitioners were constantly re-hired does not ipso facto establish that they became regular employees. Their respective contracts with respondent show that there were intervals in their employment. Accordingly. Pier 8 Arrastre & Stevedoring Services. the duration of his employment ranged from one day to several months at a time. such contracts do not.

special separation pays. Thus. During rotation proper as petitioners term it. and attorney’s fees. In fact. discharging of cargoes from ship to truck or dock. He maintains that under paragraph 2 of Article 280. absorbing PASSI workers as well as their relievers. moral.5 days (or only for an average of 6. Petitioners insist that respondent was hired as a mere stevedore and. He argued on the basis of Articles 280[9] and 281 of the Labor Code. could not become a regular stevedore. postulating that the hiring of respondent as a reliever is akin to a situation in which a worker goes on vacation leave. National Labor Relations Commission succinctly explains the delineation of the foregoing employee classification. 304. contend that this in itself does not make him a regular stevedore. sick leave. petitioners were able to regain control of their arrastre and stevedoring operations at Pier 8 on 12 March 2001. however. Stevedoring. respondent performed services for a total of 228. Ruling: De Leon v. and other related work. to support its claim that respondent is a reliever. dock and arrastre operations include. the Philippine Ports Authority (PPA) seized the facilities and took over the operations of PASSI through its Special Takeover Unit. is a mere extra worker whose work is dependent on the absence of regular stevedores during any given shift. claiming regularization. since it was his sixth continuous month in service in PASSI’s regular course of business. In the instant petition. a PPA Pass and SSS documents. Respondent alleged that he was hired by PASSI in October 1999 and was issued company ID No. if the employee has been performing the job for at least one year. the law deems the repeated and continuing need for its performance as sufficient evidence of the necessity if not indispensability of that activity to the business. The connection can be determined by considering the nature of the work performed and its relation to the scheme of the particular business or trade in its entirety. movement of cargoes inside vessels. to wit: The primary standard. terminals and docks. and vice-versa. Christmas gifts. productivity bonus. all regular employees are first called and given work before any reliever is assigned. LABOR RELATIONS Atty. The test is whether the former is usually necessary or desirable in the usual business or trade of the employer. maternity leave or paternity leave. Also. therefore. Marquez Total 36 months 228. as a reliever stevedore. petitioners hire stevedores who assist in the loading and unloading of cargoes to and from the vessels. respondent claimed he was denied the rights and privileges of a regular employee. including those granted under the Collective Bargaining Agreement (CBA) such as wage increase. For the same reasons. petitioners maintain that the foregoing provisions are inapplicable on the postulation that respondent is neither a probationary nor a casual employee. and the employer is constrained to hire another worker from outside the establishment to ensure Page 62 . Petitioners aver that the employment of the stevedores is governed by a system of rotation.34 days a month) from September 1999 to June 2003. he performed tasks that are usually necessary and desirable to their business. petitioners are vehemently denying that respondent has become PASSI regular employee. (Emphasis supplied. Hence. In defense of the Court of Appeals ruling grounded on Articles 280 and 281 of the Labor Code. On 9 May 2003. petitioners argue that Article XXV of the CBA cannot be used to support respondents’ contention that he is a regular employee since the CBA provision he invokes refers to all incumbent probationary or casual employees and workers in the company and not to respondent who is neither a casual nor a probationary employee. the opening and closing of a vessel’s hatches. In line with this. lighters and barges. even if the performance is not continuous or merely intermittent. Petitioners presented a list of the days when respondent’s services as stevedore were engaged. and others. but only with respect to such activity and while such activity exists. medical. By virtue of a Decision dated 9 January 2001 of the Court of Appeals. but are not limited to. uniforms. Petitioners assert that while the regular stevedores work an average of 4 days a week (or 16 days a month). he should be deemed a regular employee having rendered at least one year of service with the company. accident insurance. According to respondent. Petitioners concede that whenever respondent worked as a reliever stevedore due to the absence of a regular stevedore. Petitioners posit that respondent. vacation and sick leaves. warehouses. Petitioners.5 days On 15 April 2000. the employment is also considered regular. payment of service incentive leave and 13th month pays.) PASSI is engaged in providing stevedoring and arrastre services in the port area in Manila. he remained a casual employee from the time he was first hired to perform the services of a stevedore. respondent filed a Complaint with the Labor Arbiter of the NLRC. thus. of determining a regular employment is the reasonable connection between the particular activity performed by the employee in relation to the usual business or trade of the employer. Based on this system of rotation. Jefferson M. the work available to reliever stevedores is dependent on the actual stevedoring and arrastre requirements at a current given time. respondent contended that he became a regular employee by April 2000. dental and hospitalization benefits. exemplary and actual damages.

[25] Not qualifying under any of the kinds of employees covered by the first paragraph of Article 280 of the Labor Code. Petitioners were crucified on this argument raised by respondent. unless the working days in the establishment as a matter of practice or policy. Respondent also does not allege. the law deems the repeated and continuing need for its performance as sufficient evidence of the necessity. gang bosses. however. the situation of respondent is akin to that of a seasonal or project or term employee. in which case said period shall be considered one year. whether continuous or broken. renders service for an average of 16 days a month. Jefferson M. while a regular stevedore working for petitioners. carpenter. Rule V. are deemed casual employees. The union which negotiated the existing CBA is the sole and exclusive bargaining representative of all the stevedores. including authorized absences and paid regular holidays. and its offices. Section 3. The probationary period for all future workers or employees shall be the following: (a) All skilled workers such as crane operator. this Court agrees. this Court again refers to Article 280 of the Labor Code. albeit on a daily basis. Anent petitioners’ contention that respondent is neither a probationary nor a casual employee. then respondent is a casual employee under the second paragraph of the same provision. it should be deemed part of the nature of his work that he can only work as a stevedore in the absence of the employee regularly employed for the very same function. NONETHELESS. (b) All semi-skilled personnel shall become regular after four (4) months of continuous employment. project and seasonal employees. Moreover. respondent does not contest that he was well aware that he would only be given work when there are absent or unavailable employees.5 days in 36 months. The second paragraph thereof stipulates in unequivocal terms that all other employees who do not fall under the definitions in the first paragraph of regular. whether continuous or intermittent. The NLRC ruled that respondents’ reliance on the CBA to show that he has become a regular employee is misplaced for the reason that the CBA Page 63 . signalman and checkers shall become regular after three (3) months continuous employment. Based on the circumstances of the instant case. (c) All non-skilled personnel shall be regular after six (6) months continuous employment. even if the performance is not continuous or merely intermittent. As aforestated. LABOR RELATIONS Atty.5 days does not fall under the classification of a casual turned regular employee after rendering at least one year of service. Applying the foregoing. mechanic. which was effective from 4 March 1998 to 3 March 2003: The Company agrees to convert to regular status all incumbent probationary or casual employees and workers in the Company who have served the Company for an accumulated service term of employment of not less than six (6) months from his original date of hiring. that he was disallowed or prevented from offering his services to other cargo handlers in the other piers at the North Harbor other than petitioners. winchman. or roughly an average of 6. on the other hand. serving as a stevedore. Bearing in mind that respondent performed services from September 1999 until June 2003 for a period of only 228. if not indispensability.34 days a month. of that activity to the business of the employer. nor is there any showing. demonstrates that respondents employment is subject to the availability of work. reckoned from the date the employee started working. rank and file employees working at Pier 8. However. Book II of the Implementing Rules and Regulations of the Labor Code clearly defines the term at least one year of service to mean service within 12 months. If the employee has been performing the job for at least one year. is less than 12 months. It takes judicial notice that it is an industry practice in port services to hire reliever stevedores in order to ensure smooth-flowing 24-hour stevedoring and arrastre operations in the port area. No doubt. this Court still finds respondent to be a regular employee on the basis of pertinent provisions under the CBA between PASSI and its Workers union. respondent performs tasks necessary or desirable to the usual business of petitioners. depending on the absences of the regular stevedores. Marquez the smooth flow of its operations. or that provided in the employment contract. who has performed actual stevedoring services for petitioners only for an accumulated period of 228. respondent. The same provision. provides that a casual employee can be considered as regular employee if said casual employee has rendered at least one year of service regardless of the fact that such service may be continuous or broken. dock workers.

[36] The same article of the CBA stipulates that employment in PASSI cannot be obtained without prior membership in the union. January 31. applying the foregoing provisions of the CBA. 148492. 1996. recovery of benefits under the Collective Bargaining Agreement (CBA). National Organization of Workingmen. G. 22.. Marquez applies only to regular workers of the company. 1987 January 30. Coca-Cola Bottlers Phils. This requirement applies to present and future employees.. sales offices. Having rendered 228. in order to retain employment. then respondent is entitled to regularization by virtue of the said CBA provisions. 1980 February 20. They worked exclusively at respondent's plants. Respondent assents that he is not a member of the union. culling from Article II of the CBA which stipulates: The Union and the Company (PASSI) hereby agree to adopt the Union Shop as a condition of employment to the position (sic) covered by this Agreement. In light of the foregoing.R. Louie Centeno. with the length of employment as follows: Name Date Hired Date Dismissed Eddie P. David Reblora. 1988 October 15. 1995 David R. as he was not recognized by PASSI as its regular employee.. March 1. Guerra June 16. G. 1995 Juanito M. or eight months of service to petitioners since 1999. an employee is required to become a union member after a certain period. Pacquing vs. Raymundo Andrade (petitioners) were sales route helpers or cargadores-pahinantes of Coca-Cola Bottlers Philippines. for every delivery truck. 157966. Reblora September 15. Inc. Jr. respondent denied liability to petitioners and countered that petitioners were temporary workers who were engaged for a five-month period to act as substitutes for an absent regular Page 64 . No. petitioners filed a Complaint against respondent for unfair labor practice and illegal dismissal with claims for regularization. On October 22. Inc. 1995 Petitioners were part of a complement of three personnel comprised of a driver. petitioners must accord respondent the status of a regular employee. Claro Dupilad. a salesman and a regular route helper.5 days. citing Magsalin vs. 1985 January 15. 1995 Claro Dupilad. 1995 Louie Centeno September 15. although nonmembers may be hired.R. respondent should be considered a regular employee after six months of accumulated service. 2008. LABOR RELATIONS Atty. It is clearly stipulated therein that petitioners shall agree to convert to regular status all incumbent probationary or casual employees and workers in PASSI who have served PASSI for an accumulated service term of employment of not less than six months from the original date of hiring. Under a union-shop agreement. Jr. 1988 December 15. 2003 Facts: Eddie Pacquing. May 9. Apropos. and attorney's fees. Guerra. 1992 June 30. petitioners alleged that they should be declared regular employees of respondent since the nature of their work as cargadores-pahinantes was necessary or desirable to respondent's usual business and was directly related to respondent's business and trade. Pacquing June 14. 1988 March 15.. (respondent). No. and company premises. Juanito M. Roderick Centeno. In its Position Paper. Jefferson M. 1988 Roderick Centeno November 15. but this Court notes that PASSI adopts a union-shop agreement. In their Position Paper. 1996 Raymundo Andrade January 15. moral and exemplary damages.

The provisions of written agreement to the contrary notwithstanding and regardless of the oral agreement of the parties. any employee who has rendered at least one year of service. Issue: What is their status as employees? Ruling: The pivotal question of whether respondent's sales route helpers or cargadores or pahinantes are regular workers of respondent has already been resolved in Magsalin v. It is distinguished from a specific undertaking that is divorced from the normal activities required in carrying on the particular business or trade. when hired. Marquez employee. In determining whether an employment should be considered regular or non-regular. where a person thus engaged has been performing the job for at least one year. Its pertinent provisions read: Art. The standard. If.. i. although the work to be performed is only for a specific project or seasonal. the applicable test is the reasonable connection between the particular activity performed by the employee in relation to the usual business or trade of the employer. LABOR RELATIONS Atty. the law deems the repeated and continuing need for its performance as being sufficient to indicate the necessity or desirability of that activity to the business or trade of the employer. The nature of the work performed must be viewed from a perspective of the business or trade in its entirety and not on a confined scope. to ensure a regular workers’ security of tenure. Even while the language of law might have been more definitive. is one of the leading and largest manufacturers of softdrinks in the country. Respondent workers. even if the performance is not continuous or is merely intermittent. can hardly be doubted. supplied by the law itself.― one which is not indispensable in the manufacture of its products. The argument of petitioner that its usual business or trade is softdrink manufacturing and that the work assigned to respondent workers as sales route helpers so involves merely “post production activities. An employment shall be deemed to be casual if it is not covered by the preceding paragraph: Provided. a fact that can be assessed by looking into the nature of the services rendered and its relation to the general scheme under which the business or trade is pursued in the usual course. 280. an employment shall be deemed to be regular where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer. except where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season. would go with route salesmen on board delivery trucks and undertake the laborious task of loading and unloading softdrink products of Petitioner Company to its various delivery points. Coca-Cola Bottlers Phils. Regular and Casual Employment. scarcely can be persuasive.. shall be considered a regular employee with respect to the activity in which he is employed and his employment shall continue while such activity exists. thus: The basic law on the case is Article 280 of the Labor Code. Jefferson M. Page 65 . there would have then been no need for it to even maintain regular truck sales route helpers. only those whose work are directly involved in the production of softdrinks may be held performing functions necessary and desirable in its usual business or trade. That. The employment of such person is also then deemed to be regular with respect to such activity and while such activity exists. National Organization of Working Men.e. however. Respondent workers have long been in the service of petitioner company. whether such service is continuous or broken. Inc. is whether the work undertaken is necessary or desirable in the usual business or trade of the employer. But. as so argued by petitioner company. the clarity of its spirit and intent..

1987 Johnny G. however. Cocomangas Hotel Beach Resort v. LABOR RELATIONS Atty. then it should be struck down as being contrary to law. Inc. subsequently visited respondent foreman Visca and informed him that the work suspension was due to budgetary constraints. Zamora. Jefferson M. August 29. workers and laborers. 1996 Richard G. the Front Desk Officer/Sales Manager. Visca Mason/Carpenter March 27. informed them not to report for work since the ongoing constructions and repairs would be temporarily suspended because they caused irritation and annoyance to the resort's guests. Visca Carpenter April 1998 Raffie G. husband of petitioner Susan Munro. with designations and dates of employment as follows: Name Designation Date Employed Federico F. John Munro. Susan Munro (petitioners) before Sub-Regional Arbitration Branch No. While this Court. short of the normal six-month probationary period of employment.has upheld the legality of a fixed-term employment. The fact that respondent workers have agreed to be employed on such basis and to forego the protection given to them on their security of tenure. they did not report for work the succeeding days. Richard G. 1993 Ronald Q. No. A contract of employment is impressed with public interest. morals. Barredo Carpenter April 23. VI of the National Labor Relations Commission (NLRC) in Kalibo. in Brent School. to be hired on a day-to-day basis. Page 66 . as instructed. The provisions of applicable statutes are deemed written into the contract. 167045. Ronald Q. it has done so. Any obvious circumvention of the law cannot be countenanced.R. Johnny G. engaged for a fixed period of few months. Tibus. with a stern admonition that where from the circumstances it is apparent that the period has been imposed to preclude the acquisition of tenurial security by the employee. Tibus Mason November 9. and the parties are not at liberty to insulate themselves and their relationships from the impact of labor laws and regulations by simply contracting with each other. vs. Visca and Raffie G. 23. G. The pernicious practice of having employees. 2008 Facts: The present controversy stemmed from five individual complaints for illegal dismissal filed on by Federico F. Visa Foreman October 1. good customs. Barredo. Visca (Visca). Marquez The repeated rehiring of respondent workers and the continuing need for their services clearly attest to the necessity or desirability of their services in the regular conduct of the business or trade of petitioner company. Aklan. demonstrate nothing more than the serious problem of impoverishment of so many of our people and the resulting unevenness between labor and capital. public order and public policy. mocks the law. 1993 tasked with the maintenance and repair of the resort facilities. The Court of Appeals has found each of respondents to have worked for at least one year with petitioner company. Visca. thereafter. Maria Nida Iñigo-Tañala. In their consolidated Position Paper respondents alleged that they were regular employees of petitioners. Visca (respondents) against Cocomangas Hotel Beach Resort and/or its owner-manager. and.

Marquez When respondent Visca later discovered that four new workers were hired to do respondents' tasks. the NLRC made a complete turnabout from its original decision and issued a Resolution dismissing the complaint. that the repeated hiring of respondents established that the services rendered by them were necessary and desirable to petitioners' resort business. he confronted petitioner Munro who explained that respondents' resumption of work was not possible due to budgetary constraints. NLRC: set aside the Decision of the LA and ordering the payment to respondents of backwages. 13 th month pay and service incentive leave pay for three years. it ordered payment of P10. they filed their individual complaints for illegal dismissal.000. specific periods when the employment relationship would be terminated.00 to each complainant as financial assistance.000. (b) all of the respondents were certified to by petitioner Munro as workers and even commended for their satisfactory performance. It took into account the following: (a) respondent Visca was reported by petitioners as an employee in the Quarterly Social Security System (SSS) report.00 as damages. respondents prayed for payment of premium pay for rest day. that there was no illegal dismissal but completion of projects. In addition. holding that respondent Visca was an independent contractor and the other respondents were hired by him to help him with his contracted works at the resort. in addition to 10% attorney's fees. even once. not regular employees. hired depending on the tourist season and when the need arose in maintaining petitioners' resort for the benefit of guests. petitioners denied any employer-employee relationship with respondents and countered that respondent Visca was an independent contractor who was called upon from time to time when some repairs in the resort facilities were needed and the other respondents were selected and hired by him. In addition to reinstatement with payment of full backwages. arguing that respondents were project employees. the former failed to set. Nonetheless. respondents were regular seasonal employees. in that petitioners not only gave respondents the run-around but also blatantly hired others to take respondents' place despite their claim that the so-called temporary stoppage of work was due to budgetary constraints. Jefferson M. at the least. hired for a short period of time to do some repair jobs in petitioners' resort business. The NLRC held that respondents were regular employees of petitioners since all the factors determinative of employer-employee relationship were present and the work done by respondents was clearly related to petitioners' resort business. CA: The CA held respondents were regular employees. (c) respondents were paid their holiday and overtime pay. holding that respondents were not regular employees but project employees. Hence. NLRC (Motion for Reconsideration): Acting upon the petitioners’ motion. and cost-of-living allowance. plus moral and exemplary damages and attorney's fees. Issue: Page 67 . that respondents were project workers. service incentive leave pay. 13th month pay. the CA awarded respondents P50. not project workers. In their Position Paper. since in the years that petitioners repeatedly hired respondents' services. and (d) respondents had been continuously in petitioners' employ from three to twelve years and were all paid by daily wage given weekly. Petitioners then filed a Motion for Reconsideration. since their termination was attended by bad faith. LABOR RELATIONS Atty. Labor Arbiter: dismissed the complaint.

Marquez Whether respondents are regular employees or project employees. A project employee is one whose "employment has been fixed for a specific project or undertaking. Department Order No. petitioners classified respondent Visca as an independent contractor and the other respondents as his employees. At any rate." Before an employee hired on a per-project basis can be dismissed. there is no evidence that petitioners reported the termination of respondents' supposed project employment to the DOLE as project employees. sang a different tune. The petitioners were ambivalent in categorizing respondents. This Court has held that an employment ceases to be coterminous with specific projects when the employee is continuously rehired due to the demands of employer's business and re-engaged for many more projects without interruption. Jefferson M. Further. In their Position Paper filed before the LA. The NLRC should not have considered the new theory offered by the petitioners in their Motion for Reconsideration. and windbreakers and other resort facilities. so to speak. since they worked continuously for petitioners from three to twelve years without any mention of a "project" to which they were specifically assigned. Ruling: Respondents are regular employees and not project employees. More importantly. cottages. 20. motor boats. They were tasked with the maintenance and repair of the furniture. of their services to Page 68 . LABOR RELATIONS Atty. It is a matter of law that when a party adopts a particular theory and the case is tried and decided upon that theory in the court below. While initially advancing the absence of an employer-employee relationship. Petitioners' failure to file termination reports is an indication that the respondents were not project employees but regular employees. 20. To permit a party to change his theory on appeal will be unfair to the adverse party. the Court finds that the CA did not err in finding that respondents were regular employees. The repeated and continuing need for their services is sufficient evidence of the necessity. of the termination of the services of the workers every time completes a project. as well as the old Policy Instructions No. while in their Motion for Reconsideration before the NLRC. not project employees. the completion or termination of which has been determined at the time of the engagement of the employee or where the work or service to be performed is seasonal in nature and the employment is for the duration of the season. he will not be permitted to change his theory on appeal." they performed work other than carpentry or masonry. 19. In the present case. if not indispensability. respondents cannot be classified as project employees. requires employers to submit a report of an employee's termination to the nearest public employment office every time his employment is terminated due to a completion of a project. after a careful examination of the records. The Court is not persuaded by petitioners' submission that respondents' services are not necessary or desirable to the usual trade or business of the resort. pursuant to Policy Instruction No. There is likewise no evidence of the project employment contracts covering respondents' alleged periods of employment. While they had designations as "foreman. essentially invoking the termination of the period of their employer-employee relationship. petitioners treated respondents as project employees. petitioners on appeal. petitioners' position in their Motion for Reconsideration before the NLRC runs contrary to their earlier submission in their Position Paper before the LA. a report must be made to the nearest employment office." "carpenter" and "mason.

Page 69 . Thus. they were entitled to security of tenure. as amended. Price. On 16 February 2000. 16. 1999 to July 31. for their employment was terminated due to the expiration of their terms of employment. It is evident that respondents' backwages should not be limited to said period. 2000 a period of ONE YEAR. September 30. 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. computed the award for backwages from May 8. full backwages. 2000. (c) petty cash vouchers showing payment of respondents' salaries and holiday and overtime pays. and (2) these tasks are vital. Jr. at the end of the close of business hours onFebruary 16. et al.” That respondents were regular employees is further bolstered by the following evidence: (a) the SSS Quarterly Summary of Contribution Payments listing respondents as employees of petitioners. necessary and indispensable to the usual business or trade of the employer. 2002 only. substantial evidence supported the CA finding that respondents were regular employees. the termination of which was predetermined. 178505. Petitioners Cherry J. Article 279 of the Labor Code. The parties executed an employment contract denominated as a Contract of Employment for a Fixed Period. its obligation to respondents. the HRAD Manager of INNODATA wrote petitioners informing them of their last day of work. Petitioners finally argued that they could not be considered project employees considering that their employment was not coterminous with any project or undertaking. Thus. Petitioners claimed that they should be considered regular employees since their positions as formatters were necessary and desirable to the usual business of INNODATA as an encoding. continues to accumulate. Domingo. LABOR RELATIONS Atty. 2008 Facts: INNODATA had since ceased operations due to business losses in June 2002. 16. then the employee must be deemed a regular employee. G. Being regular employees. In Maraguinot. According to INNODATA. stipulating that the contract shall be effective from FEB. No. in its earlier Decision which was affirmed by the CA. insofar as accrued backwages and other benefits are concerned.R. Respondents asserted that petitioners were not illegally dismissed. pursuant to Article 280 of the Labor Code and jurisprudence. provides that an illegally dismissed employee shall be entitled to reinstatement. conversion and data processing company. until petitioners implement the reinstatement aspect... Jefferson M. the Court ruled that "once a project or work pool employee has been: (1) continuously. The Court notes that the NLRC. National Labor Relations Commission. inclusive of allowances. The backwages due respondents must be computed from the time they were unjustly dismissed until actual reinstatement to their former positions. and their services may not be terminated except for causes provided by law. as opposed to intermittently. Price. rehired by the same employer for the same tasks or nature of tasks. 24. v Innodata Phils. petitioners filed a Complaint for illegal dismissal and damages against respondents. 1999 to FEB. On 22 May 2000. Marquez petitioners' resort business. Stephanie G. (b) the Service Record Certificates stating that respondents were employees of petitioners for periods ranging from three to twelve years and all have given "very satisfactory performance". v. petitioners employment already ceased due to the end of their contract. and Lolita Arbilera were employed as formatters by INNODATA.

and absolved INNODATA of the charge of illegal dismissal. On 25 September 2006. shall be considered a regular employee with respect to the activity in which he is employed and his employment shall continue while such activity exists. whether continuous or broken. Regular and Casual Employment. Thus. An employment shall be deemed to be casual if it is not covered by the preceding paragraph. Equally important to consider is that a contract of employment is impressed with public interest such that labor contracts must yield to the common good. which reads: Art. The employment status of a person is defined and prescribed by law and not by what the parties say it should be. Jefferson M. That. There were no valid fixed-term contracts and petitioners were regular employees of the INNODATA who could not be dismissed except for just or authorized cause. 280. Regular employment has been defined by Article 280 of the Labor Code. Respondent INNODATA appealed the Labor Arbiters Decision to the NLRC. Based on the afore-quoted provision. whether such service is continuous or broken. The provisions of written agreement to the contrary notwithstanding and regardless of the oral agreement of the parties. except where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of engagement of the employee or where the work or services to be performed is seasonal in nature and employment is for the duration of the season. regardless of the length of their employment. Hence. The NLRC reversed the Labor Arbiters Decision dated 17 October 2000. Marquez The Labor Arbiter issued its Decision finding petitioners complaint for illegal dismissal and damages meritorious. and (2) those who were initially hired as casual employees. this petition. LABOR RELATIONS Atty. Provided. but have rendered at least one year of service. Issues: Whether petitioners were illegally dismissed by respondents Whether petitioners were hired by INNODATA under valid fixed-term employment contracts Ruling: The Court finds merit in the present Petition. any employee who has rendered at least one year of service. provisions of applicable statutes are deemed written into the contract. as amended. Page 70 . the Court of Appeals promulgated its Decision sustaining the ruling of the NLRC that petitioners were not illegally dismissed. with respect to the activity in which they are employed. the following employees are accorded regular status: (1) those who are engaged to perform activities which are necessary or desirable in the usual business or trade of the employer. (Underscoring ours). an employment shall be deemed to be regular where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer. and the parties are not at liberty to insulate themselves and their relationships from the impact of labor laws and regulations by simply contracting with each other.

the applicable test to determine whether an employment should be considered regular or non-regular is the reasonable connection between the particular activity performed by the employee in relation to the usual business or trade of the employer. executive vice-president or vice president. which are by practice or tradition rotated among the faculty members. Petitioners were merely rehired on 6 September 1999 for a new project. they also include those to which the parties by free choice have assigned a specific date of termination. although it may not be known when. as well as the circumstances surrounding petitioners employment at INNODATA. Similarly. invalid. to which. Jefferson M. "x x may lose their jobs as president. where not expressly set down. petitioners were employed by INNODATA on 17 February 1999 as formatters. etc. The contracts of employment submitted by respondents are highly suspect for not only being ambiguous. therefore. the Court identified several circumstances wherein a fixed-term is an essential and natural appurtenance. petitioners belong to the first type of regular employees. The decisive determinant in term employment is the day certain agreed upon by the parties for the commencement and termination of their employment relationship. Under Article 280 of the Labor Code. and where fixed terms are a necessity without which no reasonable rotation would be possible. Article 280 of the Labor Code notwithstanding. to wit: Some familiar examples may be cited of employment contracts which may be neither for seasonal work nor for specific projects. these do not necessarily result in regular employment under Article 280 of the Labor Code. Under the Civil Code. and the formatting of the data entered into the computers is an essential part of the process of data encoding. More importantly. the concept of regular employment with all that it implies does not appear ever to have been applied. the work performed by petitioners was necessary or desirable in the business or trade of INNODATA. as they are under the present Labor Code. the very same case invoked by respondents. whatever the nature of the engagement. for one. In the case at bar. it is obvious that in one of Page 71 . Formatting organizes the data encoded. and other administrative offices in educational institutions.They later on admitted in their Memorandum filed with this Court that petitioners were originally hired on 16 February 1999 but the project for which they were employed was completed before the expiration of one year. Seasonal employment and employment for a particular project are instances of employment in which a period. a day certain being understood to be that which must necessarily come. the Court is convinced that the terms fixed therein were meant only to circumvent petitioners right to security of tenure and are. because the stockholders or the board of directors for one reason or another did not reelect them. assistant dean. at the expiration of which they would have to stand down. Marquez Undoubtedly. but to which a fixed term is an essential and natural appurtenance: overseas employment contracts. principal. it has consistently held that this is the exception rather than the general rule. LABOR RELATIONS Atty. While respondents submitted employment contracts with 6 September 1999 as beginning date of effectivity. 8 of the Minister of Labor implicitly recognize that certain company officials may be elected for what would amount to fixed periods. The primary business of INNODATA is data encoding. in providing that these officials. to those by nature seasonal or for specific projects with predetermined dates of completion. making it easier to understand for the clients and/or the intended end users thereof. despite the provisions of Article 280. it is also true that while certain forms of employment require the performance of usual or desirable functions and exceed one year. Undeniably. fixed-term employment contracts are not limited. is necessarily implied. a fixed-term employment is valid only under certain circumstances. While this Court has recognized the validity of fixed-term employment contracts. college secretary. also appointments to the positions of dean. but also for appearing to be tampered with. Policy Instructions No. However. In Brent." After considering petitioners contracts in their entirety.

279. the employer shall not terminate the services of an employee except for a just cause or when authorized by this Title. In the words of Article 279 of the Labor Code: ART. respondents insistence that it can legally dismiss petitioners on the ground that their term of employment has expired is untenable. More importantly. G. 25. 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. October 10. cralaIn all. petitioners alleged . the original beginning date of effectivity. If the contracts took effect only on 6 September 1999. 167627. 16 February 1999. the total period of their employment becomes irrelevant. This contention is specious and devoid of merit. This was exactly the purpose of the legislators in drafting Article 280 of the Labor Code to prevent the circumvention by unscrupulous employers of the employees right to be secure in his tenure by indiscriminately and completely ruling out all written and oral agreements inconsistent with the concept of regular employment. In fact. LABOR RELATIONS Atty. 2008 Facts: Page 72 . Obviously. An employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages. Security of Tenure. Although the contracts made general references to a project. inclusive of allowances. Under Section 3. In cases of regular employment. are entitled to security of tenure. petitioners. Cagampang. Scrutinizing petitioners employment contracts with INNODATA. failed to reveal any mention therein of what specific project or undertaking petitioners were hired for. Nonetheless. INNODATA contends that petitioners were project employees whose employment ceased at the end of a specific project or undertaking. was merely crossed out and replaced with 6 September 1999. then its period of effectivity would obviously be less than one year. Further attempting to exonerate itself from any liability for illegal dismissal. such project was neither named nor described at all therein. Article XVI of the Constitution. however. the Court emphasizes that it has already found that petitioners should be considered regular employees of INNODATA by the nature of the work they performed as formatters. Such modification and denial by respondents as to the real beginning date of petitioners employment contracts render the said contracts ambiguous. there is also a dearth of evidence that such project or undertaking had already been completed or terminated to justify the dismissal of petitioners. The conclusion by the Court of Appeals that petitioners were hired for the Earthweb project is not supported by any evidence on record. To reiterate.R. which was necessary in the business or trade of INNODATA.and respondents failed to dispute that petitioners did not work on just one project. The only reason the Court can discern from such a move on respondents part is so that they can preclude petitioners from acquiring regular status based on their employment for one year. The contracts themselves state that they would be effective until 16 February 2000 for a period of one year. Agusan del Norte Electric Cooperative v. Jefferson M. respondents wanted to make it appear that petitioners worked for INNODATA for a period of less than one year.Hence. The one-year period for which petitioners were hired was simply fixed in the employment contracts without reference or connection to the period required for the completion of a project. The Petition for Review on Certiorari is GRANTED. Marquez them. No. or for a period of only about five months. it is the policy of the State to assure the workers of security of tenure and free them from the bondage of uncertainty of tenure woven by some employers into their contracts of employment. but continuously worked for a series of projects for various clients of INNODATA. being regular employees of INNODATA.

and separation pay. Issue: WON Cagampang and Garzon are regular employees/workers of the petitioner. and as such were illegally dismissed. even if the performance is not continuous or merely intermittent. They prayed for payment of backwages.00. LA ruled that there was illegal dismissal. (ANECO) on October 1. we held that where the employment of project employees is extended long after the supposed project has been finished. It held that respondents Cagampang and Garzon are deemed regular workers. Inc. under an employment contract which was for a period not exceeding three months. if not indispensability of that activity to the business. the two were laid-off for one to five days and then ordered to report back to work but on the basis of job orders. Thus. premium for alleged work during holidays and rest days. National Labor Relations Commission: [11] The test to determine whether employment is regular or not is the reasonable connection between the particular activity performed by the employee in relation to the usual business or trade of the employer. morals. they should be struck down as contrary to public policy. it is vital in determining if the employee was hired for a specific undertaking or tasked to perform functions vital. allowances. Also. if not indispensability. Here. salary differential. Thus. [12] Respondents in the present case being regular employees. His employment ceased to be coterminous with specific projects when he was repeatedly re-hired due to the demands of petitioner's business. Additionally. the respondents have been performing the job for at least one year. necessary and indispensable to the usual business or trade of the employer. Where from the circumstances it is apparent that periods have been imposed to preclude the acquisition of tenurial security by the employee. Ruling: SC denied the petition. good customs or public order. NLRC reversed the LA’s decision. ANECO as the employer had the burden of proof to show that the respondents' Page 73 . While length of time may not be the controlling test for project employment. on January 11. As held in Integrated Contractor and Plumbing Works. Inc. CA however set aside NLRC’s decision. resulting in their loss of employment. if the employee has been performing the job for at least one year. After several renewals of their job contracts in the form of job orders for similar employment periods of about three months each. service incentive leave. Marquez Respondents Joel Cagampang and Glenn Garzon started working as linemen for petitioner Agusan del Norte Electric Cooperative. 1998 and July 30. of that activity to the business. private respondent had been a project employee several times over. However. respondents filed an illegal dismissal case against petitioners before the LA. The law deems the repeated and continuing need for its performance as sufficient evidence of the necessity. the said contracts eventually expired on April 31. getting a daily salary of P122. the employees are removed from the scope of project employees and are considered regular employees. the law deems the repeated and continuing need for its performance as sufficient evidence of the necessity. Respondents' contracts were no longer renewed. LABOR RELATIONS Atty. There is no dispute that the respondents' work as linemen was necessary or desirable in the usual business of ANECO. 1999. 1990. Jefferson M. They were both allegedly required to work eight hours a day and sometimes on Sundays. 2001. When the contract expired. v.

including respondent Trinidad.” with the duration and scope of his engagement specified at the time his service is contracted. Ruling: The test for distinguishing a “project employee” from a “regular employee” is whether or not he has been assigned to carry out a “specific project or undertaking. Petitioner company counteredhttp://sc.judiciary. dump truck.htm .htm .gov.http://sc. 26. Issue: Whether or not petitioner company’s repeated rehiring of respondent Trinidad over several years as project employee for its various projects automatically entitled him to the status of a regular employee. to renew respondents' work contracts for the performance of what would otherwise be regular jobs in relation to the trade or business of the former. [13]Such conduct dismally falls short of the requirements of our labor laws regarding dismissals. Respondent Trinidad further alleged that petitioner company terminated him from work after it shut down operations because of lack of projects. he had to execute an employment contract with it. He had signed several employment contracts with the company that identified him as a project employee although he had always been assigned to work on one project after another with some intervals. al vs. He learned later. 2010 Facts: Respondent Jorge R. The weakness of the employee's defense should not operate to relieve nor discharge the employer of its burden to prove its charges pursuant to the guaranty of tenure granted by the Constitution to employees under the Labor Code.ph/jurisprudence/2010/march2010/183250. called Appointment as Project Worker. Unfortunately.htm . The case of the employer must stand or fall on its own merits. it did not hire him back for that project. what petitioners did was merely to refuse. By the nature of such business. hence the employer did not observe due process in dismissing them from their employment. whose employments had to be co-terminous with the completion of specific company projects.gov.judiciary. it is not disputed that petitioner company Page 74 . every time the company employed Trinidad. his loss of work cannot be regarded as unjust dismissal. Trinidad. however. The Labor Arbiter. however. without justifiable reason. GR No. since Trinidad was a project employee and since his company submitted the appropriate establishment termination report to DOLE.judiciary. The Labor Arbiter rendered a decision.ph/jurisprudence/2010/march2010/183250. that although it opened up a project in Batangas. ordered petitioner company to pay Trinidad P1. Jefferson M. Marquez termination was for a just cause. Petitioner company stressed that employment intervals or gaps were inherent in the construction business. Trinidad claimed that he had been working with the latter company for 16 years since 1988 as driver of its service vehicle._ftn5 Here. In compliance with labor rules.gov. March 10._ftn2 The Labor Arbiter held that. the company submitted an establishment termination report to the Department of Labor and Employment (DOLE).ph/jurisprudence/2010/march2010/183250. Employer is burdened to prove just cause for terminating the employment of its employee with clear and convincing evidence. taking into consideration the three-year prescriptive period for money claims. 183250._ftn1 that it was in the construction business. Their dismissals were patently illegal.00 in unpaid service incentive leave. LABOR RELATIONS Atty. William Uy Construction et. it had to hire and engage the services of project construction workers.500. and transit mixer. Trinidad filed a complaint for illegal dismissal and unpaid benefits against petitioner William Uy Construction Corporation. dismissing respondent Trinidad’s complaint for unjust dismissal. For this reason.http://sc. however. No twin notices of termination were issued to the employees.

Construction companies have no control over the decisions and resources of project proponents or owners. The NLRC modified the decision of the Labor Arbiter and ordered the reinstatement of the complainants with limited backwages. there was no illegal dismissal. 27. they were served notices of project completion. both the Labor Arbiter and the NLRC were satisfied that the fact of petitioner company’s compliance with DOLE Order 19 had been proved in this case.gov. 2010 Facts: Petitioners (LMCEC Employees) filed a complaint for illegal dismissal and non-payment of monetary benefits against respondent LM Camus Engineering Corp. however. is that work depended on decisions and developments over which construction companies have no say.M._ftn6 He remained a project employee regardless of the number of years and the various projects he worked for the company. But this standard will not be fair._ftn9 Petitioner company needed only to show the last status of Trinidad’s employment.ph/jurisprudence/2010/march2010/183250. There is no construction company that does not wish it has such control but the reality.htm . Respondent Trinidad’s series of employments with petitioner company were co-terminous with its projects. upon the completion of each project. entitled to the security and benefits of regularization. they maintained that they were part of a work pool from which LMCEC drew its workers for its various projects.judiciary. LABOR RELATIONS Atty. Marquez contracted respondent Trinidad’s service by specific projects with the duration of his work clearly set out in his employment contracts. WHEREFORE._ftn7 Generally.R. Petitioners. rest day.. When its Boni Serrano-Katipunan Interchange Project was finished. service incentive leave pay. understood by construction workers. They claimed that petitioners were project employees and. Camus Engineering Corp. The respondents appealed the decision to the Court of Appeals and the appellate court held that the complainants are PROJECT EMPLOYEES and hence.htm .judiciary. premium pay for holiday. Finally. They denied that they were project or contractual employees because their employment was continuous and uninterrupted for more than one (1) year. September 1.G. namely. Respondents denied that petitioners were illegally dismissed from employment. if applied to the construction industry. L. He was not dismissed. Indeed. Intervals or gaps separated one contract from another.gov.http://sc.ph/jurisprudence/2010/march2010/183250.http://sc. Dacuital vs. His employment history belies the claim that he continuously worked for the company. His employment contract simply ended with the project for which he had signed up. the Court GRANTS the petition. and 13th month pay during the existence and duration of their employment. They also averred that they were not provided with sick and vacation leaves. length of service provides a fair yardstick for determining when an employee initially hired on a temporary basis becomes a permanent one. Page 75 . and REINSTATES the decision of the National Labor Relations Commission which affirmed the decision of the Labor Arbiter. Jefferson M. 176748. They clarified that the termination of petitioners’ employment was due to the completion of the projects for which they were hired.htm . No.ph/jurisprudence/2010/march2010/183250. And getting projects is not a matter of course.judiciary. The employees alleged that they were illegally dismissed from employment and that their employer failed to pay them their holiday pay. Trinidad’s employment ended with it.gov. simply because construction firms cannot guarantee work and funding for its payrolls beyond the life of each project. The Labor Arbiter rendered a decision declaring the dismissal of the complainant-employees as ILLEGAL and the complainants are entitled to reinstatement without back wages. that of a project employee under a contract that had ended and the company’s compliance with the reporting requirement for the termination of that employment.http://sc. before the National Labor Relations Commission (NLRC). countered that they were regular employees as they had been engaged to perform activities which are usually necessary or desirable in the usual business or trade of LMCEC.

No. except where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season. where no other evidence was offered. 184362. He was assigned to different construction projects undertaken by petitioner in Metro Manila. In July of 2004 he was told not to report for work anymore allegedly due to old age. prompting him to file on August 6. the last of which was for a building in Libis.R. vs. Tiu's family. LABOR RELATIONS Atty. Page 76 . as well as the duration of his employment. Hence. the absence of the employment contracts raises a serious question of whether the employees were properly informed at the onset of their employment of their status as project employees. the duration of the project for which he was allegedly hired was not specified in the contract..xxx The principal test used to determine whether employees are project employees is whether or not the employees were assigned to carry out a specific project or undertaking. In this case. the duration or scope of which was specified at the time the employees were engaged for that project. November 15.. an employment shall be deemed to be regular where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer. and Kenneth Construction Corporation. Chief Executive Officer of Millennium Erectors Corporation (petitioner). Quezon City. Article 280 of the Labor Code distinguishes a "project employee" from a "regular employee" in this wise: Article 280. In fact. Jefferson M. Marquez ISSUE: Whether or not the Court of Appeals is correct in concluding that the petitioners are PROJECT EMPLOYEES and that their dismissal from employment was legal RULING: The Supreme Court speaking through Justice Nachura answered in the NEGATIVE. 28. Even though the absence of a written contract does not by itself grant regular status to petitioners. the Dismissal of the petitioners are declared ILLEGAL. 2004 an illegal dismissal complaint 1 before the Labor Arbiter. the contract does not show that he was informed of the nature. G. Magallanes. such a contract is evidence that petitioners were informed of the duration and scope of their work and their status as project employees. 2010 Facts: Respondent Virgilio Magallanes started working in 1988 as a utility man for Laurencito Tiu (Tiu). Millenium Erectors Corp.—The provisions of written agreement to the contrary notwithstanding and regardless of the oral agreement of the parties. Regular and casual employment. While it is true that respondents presented the employment contract of Dacuital.

the petition is DENIED. enjoy security of tenure and are entitled to hold on to their work or position until their services are terminated by any of the modes recognized under the Labor Code. (emphasis and underscoring supplied) Assuming arguendo that petitioner hired respondent initially on a per project basis. contending that respondent's motion for reconsideration which it treated as an appeal was not perfected. as shown by the sample payrolls converted his status to that of a regular employee 2. Dutch Boy awarded another contract to Exodus for the painting of Pacific Plaza. for the painting of the Imperial Sky Garden located in Binondo. WHEREFORE. the completion or termination of which has been determined at the time of the engagement of the employee or where the work or service to be performed is seasonal in nature and the employment is for the duration of the season. the application of technical rules of procedure may be relaxed. GUILLERMO BISCOCHO et. the service of project employees are coterminus [sic] with the project and may be terminated upon the end or completion of that project or project phase for which they were hired. In labor cases. rules of procedure should not be applied in a very rigid and technical sense. 2004. when services were terminated. Jefferson M. Petitioner moved for reconsideration of the NLRC decision. Marquez Issue: Whether or not Magallanes’ dismissal violates security of tenure. After all. February 23. In the furtherance of its business. No. 166109. A project employee is one whose "employment has been fixed for a specific project or undertaking.G. LABOR RELATIONS Atty. Page 77 . Manila. Arguments: MEC Respondent was a project employee whom it hired for a building project in Libis on January 30 and which was in near completion on August 3. Taguig City. Said all DOLE requirements were complied. Regular employees. Technicalities should not be permitted to stand in the way of equitably and completely resolving the rights and obligations of the parties. 29. Where the ends of substantial justice shall be better served. that there was no statement of the date of receipt of the appealed decision. the same liberality applies." As the Court has consistently held. in contrast. 2011 Facts: Exodus International Construction Corporation obtained a contract from Dutch Boy Philippines. it having been belatedly filed. EXODUS INTERNATIONAL CONSTRUCTION CORPORATION vs. As to the defective verification in the appeal memorandum before the NLRC. Inc. his continued rehiring. not jurisdictional. Exodus hired respondents as painters on different dates.R. the requirement regarding verification of a pleading is formal. and that it lacked verification and copies thereof were not furnished the adverse parties RULING: 1. Towers in Fort Bonifacio. al.

Indeed. thus entitled to reinstatement Ruling: (1) No. Fernando. respondents could not name the particular person who effected their dismissal and under what particular circumstances. Ferdinand. Marquez On November 27. much less illegal. petitioners averred that he absented himself from work and applied as a painter with SAEI-EEI which is the general building contractor of Pacific Plaza Towers. When he reported for work the following day. there was no evidence that respondents were dismissed nor were they prevented from returning to their work. Absent any showing of an overt or positive act proving that petitioners had dismissed respondents. As found by the Labor Arbiter. It was only respondents' unsubstantiated conclusion that they were dismissed. Page 78 . service incentive leave pay. As a matter of fact. There was no dismissal. Jefferson M. To constitute abandonment of work. Abandonment is the deliberate and unjustified refusal of an employee to resume his employment. and Miguel were caught eating during working hours for which they were reprimanded by their foreman. It is a settled rule that mere absence or failure to report for work is not enough to amount to abandonment of work. Guillermo absented himself from work without leave. and there was also no abandonment of job to speak of. a cursory examination of the records reveal no illegal dismissal to speak of. the latters' claim of illegal dismissal cannot be sustained. respondents were ordered be reinstated but without any backwages. Petitioners denied respondents' allegations. Since then they no longer reported for work. 13th month pay and night-shift differential pay. he was reprimanded so he worked only half- day and thereafter was unheard of until the filing of the instant complaint. Since there is neither illegal dismissal nor abandonment of job. The Labor Arbiter is also correct in ruling that there was no abandonment on the part of respondents that would justify their dismissal from their employment. he never reported back to work. The Labor Arbiter exonerated Exodus from the charge of illegal dismissal as respondents chose not to report for work. 2000. LABOR RELATIONS Atty. respondents filed a complaint for illegal dismissal and non-payment of holiday pay. As regards Gregorio. two elements must concur: the employee must have failed to report for work or must have been absent without valid or justifiable reason and there must have been a clear intention on the part of the employee to sever the employer-employee relationship manifested by some overt act. Issues: WON respondents were illegally dismissed for abandonment of work WON they are regular employees. Since then.

there were no more positions where they can be reinstated as painters. It is now too late for petitioners to claim that respondents are project employees whose employment is coterminous with each project or phase of the project to which they are assigned. Among [respondent's] geothermal projects is the Leyte Geothermal Power Project located at the Greater Tongonan Geothermal Reservation in Leyte. Petitioner is a legitimate labor organization. Leyte Geothermal Power Progressive Employees Union v. Thus. There was no employment agreement given to respondents which clearly spelled out the duration of their employment. The evidence on record shows that respondents were employed and assigned continuously to the various projects of petitioners. who are engaged in subcontracting jobs for painting of residential units. highly unfair and unjust. (2) Respondents are regular employees of petitioners. condominium and commercial buildings. Nonetheless. they performed activities which were necessary and desirable in the usual business of petitioners. In cases where there is no evidence of dismissal. However. Phil National Oil Co. As painters. 176351." It is therefore incumbent upon petitioners to ascertain the respondents' interest or non-interest in the continuance of their employment. generation and distribution of energy resources like geothermal energy. the specific work to be performed and that such is made clear to them at the time of hiring. G. is impossible. Jefferson M. duly registered with the Department of Labor and Employment (DOLE) Regional Office No. and 13th month pay. respondents are entitled to be reinstated without loss of seniority rights. The project was already completed by petitioners. respondents were automatically transferred to the next project awarded to petitioners. Respondents are also entitled to their money claims such as the payment of holiday pay. petitioners failed to do so. whereby. March 30. a project employee may acquire the status of a regular employee. their positions automatically ceased to exist. No. As regular employees. Petitioners posit that the reinstatement of respondents to their former positions. which were no longer existing. but also in the island of Luzon as well. development. 2011 Facts: [Respondent Philippine National Oil Corporation]-Energy Development Corporation [PNOC-EDC] is a government-owned and controlled corporation engaged in exploration. utilization. It is clear from the records that when one project is completed. having completed their tasks. However. The said Project is composed of the Tongonan 1 Geothermal Project (T1GP) and the Leyte Geothermal Production Field Project (LGPF) which provide the power and electricity needed not only in the provinces and cities of Central and Eastern Visayas (Region VII and VIII). they cannot be entitled to backwages. 30. LABOR RELATIONS Atty. the [respondent] hired and employed hundreds of employees on a contractual basis.R. Marquez It is the employer who has the burden of proof to show a deliberate and unjustified refusal of the employee to resume his employment without any intention of returning. Consequently. the remedy is reinstatement but without backwages. service incentive leave pay. Tacloban City.. assuming that respondents were initially hired as project employees. VIII. their employment was only good up to the completion or termination of the project and would automatically expire upon the completion of such Page 79 .

That. all the striking workers were directed to return to work within twelve (12) hours from receipt of the Order and for the [respondent] to accept them back under the same terms and conditions of employment prior to the strike. paragraph 1. VIII-1-0019-99)." We cannot subscribe to the view taken by petitioner Union. the petitioner did not abide by [the] assumption order issued by the Secretary of Labor. the parties were directed to cease and desist from committing any act that would exacerbate the situation. filed a Petition for Cancellation of Petitioner's Certificate of Registration with DOLE. Issue:S Whether the officers and members of petitioner Union are project employees of respondent. However. Declaration of Loss of Employment and Damages at the NLRC-RAB VIII in Tacloban City and at the same time. and to other jobs pursuant to civil works. the petitioner declared a strike and staged such strike. an employment shall be deemed to be regular where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer. petitioner Union contends that its officers and members performed activities that were usually necessary and desirable to respondent's usual business. VIII. Further. shall be considered a regular employee with respect to the activity in Page 80 . of the Labor Code: ART. 1998.The provisions of written agreement to the contrary notwithstanding and regardless of the oral agreement of the parties. Sometime in 1998 when the project was about to be completed. certifying the labor dispute to the NLRC for compulsory arbitration. 280. the petitioner remained adamant and unreasonable in its position. which lack of interval. causing the failure of the negotiation towards a peaceful compromise. On December 28. In view of that circumstance. any employee who has rendered at least one year of service. Laguesma intervened and issued the Order. 1999. and Whether the officers and members of petitioner Union engaged in an illegal strike. 1999 for the proper disposition thereof. Regular and Casual Employment." On the same day. 1999. except where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee or where the work or service to be performed is seasonal in nature and the employment is for the duration of the season. Accordingly. Regional Office No. on January 15. whether such service is continuous or broken. Majority of the employees hired by [respondent] in its Leyte Geothermal Power Projects had become members of petitioner. Jefferson M. The said certified case was indorsed to the NLRC 4th Division in Cebu City on June 21. "manifests that the `undertaking' is usually necessary and desirable to the usual trade or business of the employer. Petitioner Union likewise points out that there was no interval in the employment contract of its officers and members. despite earnest efforts on the part of the Secretary of Labor and Employment to settle the dispute amicably. Ruling: On the first issue. dated January 4. which are usually necessary and desirable to the department. who were all employees of respondent. V- 02-99 (NCMB-RAB VIII-NS-12-0190-98. the [respondent] proceeded to serve Notices of Termination of Employment upon the employees who are members of the petitioner. union busting and mass termination. In effect. LABOR RELATIONS Atty. Consequently. The distinction between a regular and a project employment is provided in Article 280. Marquez project. The consolidated case was docketed as NLRC Certified Case No. The two cases were later on consolidated pursuant to the New NLRC Rules of Procedure. An employment shall be deemed to be casual if it is not covered by the preceding paragraph: Provided. the petitioner filed a Notice of Strike with DOLE against the [respondent] on the ground of purported commission by the latter of unfair labor practice for "refusal to bargain collectively. However. then Secretary of Labor Bienvenido E. RAB Case No. the petitioner demands from the [respondent] for recognition of it as the collective bargaining agent of said employees and for a CBA negotiation with it. In fact. To avert any work stoppage. petitioner Union reiterates that its officers and members were assigned to the Construction Department of respondent as carpenters and masons. for petitioner Union. the [respondent] filed a Complaint for Strike Illegality. the [respondent] did not heed such demands of the petitioner.-.

LABOR RELATIONS
Atty. Jefferson M. Marquez

which he is employed and his employment shall continue while such actually exists.

The foregoing contemplates four (4) kinds of employees: (a) regular employees or those who have been "engaged to perform activities which are
usually necessary or desirable in the usual business or trade of the employer"; (b) project employees or those "whose employment has been
fixed for a specific project or undertaking[,] the completion or termination of which has been determined at the time of the engagement of the
employee"; (c) seasonal employees or those who work or perform services which are seasonal in nature, and the employment is for the duration
of the season; and (d) casual employees or those who are not regular, project, or seasonal employees. Jurisprudence has added a fifth kind-- a
fixed-term employee.

Article 280 of the Labor Code, as worded, establishes that the nature of the employment is determined by law, regardless of any contract
expressing otherwise. The supremacy of the law over the nomenclature of the contract and the stipulations contained therein is to bring to life the
policy enshrined in the Constitution to "afford full protection to labor." Thus, labor contracts are placed on a higher plane than ordinary contracts;
these are imbued with public interest and therefore subject to the police power of the State.

However, notwithstanding the foregoing iterations, project employment contracts which fix the employment for a specific project or undertaking
remain valid under the law: x x x By entering into such a contract, an employee is deemed to understand that his employment is coterminous
with the project. He may not expect to be employed continuously beyond the completion of the project. It is of judicial notice that project
employees engaged for manual services or those for special skills like those of carpenters or masons, are, as a rule, unschooled. However, this
fact alone is not a valid reason for bestowing special treatment on them or for invalidating a contract of employment. Project employment
contracts are not lopsided agreements in favor of only one party thereto. The employer's interest is equally important as that of the employee[s']
for theirs is the interest that propels economic activity. While it may be true that it is the employer who drafts project employment contracts with
its business interest as overriding consideration, such contracts do not, of necessity, prejudice the employee. Neither is the employee left
helpless by a prejudicial employment contract. After all, under the law, the interest of the worker is paramount.

In the case at bar, the records reveal that the officers and the members of petitioner Union signed employment contracts indicating the specific
project or phase of work for which they were hired, with a fixed period of employment. The NLRC correctly disposed of this issue: A deeper
examination also shows that [the individual members of petitioner Union] indeed signed and accepted the [employment contracts] freely and
voluntarily. No evidence was presented by [petitioner] Union to prove improper pressure or undue influence when they entered, perfected and
consummated [the employment] contracts. In fact, it was clearly established in the course of the trial of this case, as explained by no less than
the President of [petitioner] Union, that the contracts of employment were read, comprehended, and voluntarily accepted by them. x x x.

As clearly shown by [petitioner] Union's own admission, both parties had executed the contracts freely and voluntarily without force, duress or
acts tending to vitiate the worker[s'] consent. Thus, we see no reason not to honor and give effect to the terms and conditions stipulated therein.
x x x.

Thus, we are hard pressed to find cause to disturb the findings of the NLRC which are supported by substantial evidence.

It is well-settled in jurisprudence that factual findings of administrative or quasi-judicial bodies, which are deemed to have acquired expertise in
matters within their respective jurisdictions, are generally accorded not only respect but even finality, and bind the Court when supported by
substantial evidence. Rule 133, Section 5 defines substantial evidence as "that amount of relevant evidence which a reasonable mind might
accept as adequate to justify a conclusion."

Consistent therewith is the doctrine that this Court is not a trier of facts, and this is strictly adhered to in labor cases. We may take cognizance of
and resolve factual issues, only when the findings of fact and conclusions of law of the Labor Arbiter or the NLRC are inconsistent with those of

Page 81

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Atty. Jefferson M. Marquez

the CA.

In the case at bar, both the NLRC and the CA were one in the conclusion that the officers and the members of petitioner Union were project
employees. Nonetheless, petitioner Union insists that they were regular employees since they performed work which was usually necessary or
desirable to the usual business or trade of the Construction Department of respondent.

Policy Instruction No. 12 of the Department of Labor and Employment discloses that the concept of regular and casual employees was designed
to put an end to casual employment in regular jobs, which has been abused by many employers to prevent so - called casuals from enjoying the
benefits of regular employees or to prevent casuals from joining unions. The same instructions show that the proviso in the second paragraph of
Art. 280 was not designed to stifle small-scale businesses nor to oppress agricultural land owners to further the interests of laborers, whether
agricultural or industrial. What it seeks to eliminate are abuses of employers against their employees and not, as petitioners would have us
believe, to prevent small-scale businesses from engaging in legitimate methods to realize profit. Hence, the proviso is applicable only to the
employees who are deemed "casuals" but not to the "project" employees nor the regular employees treated in paragraph one of Art. 280.

Clearly, therefore, petitioners being project employees, or, to use the correct term, seasonal employees, their employment legally ends upon
completion of the project or the [end of the] season. The termination of their employment cannot and should not constitute an illegal dismissal.

31. St. Paul College Quezon City vs. Ancheta II, G.R. No. 169905, September 7, 2011

Facts:

Remigio Michael Ancheta was a full-time probationary teacher in the School Year 1996-1997 which was renewed in the following SY 1997-1998.
His wife, Cynthia was hired as a part time teacher of the Mass Communication Department in the second semester of SY 1996-1997 and her
appointment was renewed for SY 1997-1998.

On February 13, 1998, respondents signified their intentions to renew their contracts for SY 1998-1999. They were later sent two letters
informing them that the school is extending to them new contracts for SY 1998-1999.

Thereafter, a letter was written to Remigio Michael, enumerating the departmental and instructional policies that spouses failed to comply with,
such as the late submission of final grades, failure to submit final test questions to the Program Coordinator, the giving of tests in the essay form
instead of the multiple choice format as mandated by the school, failure to report to work on time; the high number of students with failing grades
in the classes that they handled, and not being open to suggestions to improve themselves as teachers, among others.

Thereafter, Sr. Bernadette (Department Coordinator) endorsed the immediate termination of the teaching services of the spouses. Respondent
spouses were given an opportunity to comment on the letter-recommendation. Subsequently however, they received their respective letters of
termination. Thus, spouses filed a Complaint for illegal dismissal.

St. Paul contends that it did not extend the contracts of respondent spouses. Although, it has sent letters to the spouses informing them that the
school is extending to them new contracts for the coming school year, the letters do not constitute as actual employment contracts but merely
offers to teach on the said school year.

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LABOR RELATIONS
Atty. Jefferson M. Marquez

Issues:

WON respondents were considered regular employees

WON they were illegally dismissed

Ruling:

(1) Employment on probationary status of teaching personnel is that they are not governed purely by the Labor Code. The Labor Code is
supplemented with respect to the period of probation by special rules found in the Manual of Regulations for Private Schools. On the matter of
probationary period, Section 92 of these regulations provides:

Section 92.Probationary Period. — Subject in all instances to compliance with the Department and school requirements, the probationary period
for academic personnel shall not be more than three (3) consecutive years of satisfactory service for those in the elementary and secondary
levels, six (6) consecutive regular semesters of satisfactory service for those in the tertiary level, and nine (9) consecutive trimesters of
satisfactory service for those in the tertiary level where collegiate courses are offered on a trimester basis.

A probationary employee or probationer is one who is on trial for an employer, during which the latter determines whether or not he is qualified
for permanent employment. The probationary employment is intended to afford the employer an opportunity to observe the fitness of a
probationary employee while at work, and to ascertain whether he will become an efficient and productive employee. While the employer
observes the fitness, propriety and efficiency of a probationer to ascertain whether he is qualified for permanent employment, the probationer, on
the other hand, seeks to prove to the employer that he has the qualifications to meet the reasonable standards for permanent employment.
Thus, the word probationary, as used to describe the period of employment, implies the purpose of the term or period, not its length.

The common practice is for the employer and the teacher to enter into a contract, effective for one school year. At the end of the school year, the
employer has the option not to renew the contract, particularly considering the teacher's performance. If the contract is not renewed, the
employment relationship terminates. If the contract is renewed, usually for another school year, the probationary employment continues. Again,
at the end of that period, the parties may opt to renew or not to renew the contract. If renewed, this second renewal of the contract for another
school year would then be the last year — since it would be the third school year — of probationary employment. At the end of this third year, the
employer may now decide whether to extend a permanent appointment to the employee, primarily on the basis of the employee having met the
reasonable standards of competence and efficiency set by the employer. For the entire duration of this three-year period, the teacher remains
under probation. Upon the expiration of his contract of employment, being simply on probation, he cannot automatically claim security of tenure
and compel the employer to renew his employment contract.

(2) No.

Section 91 of the Manual of Regulations for Private Schools, states that:

Section 91.Employment Contract. — Every contract of employment shall specify the designation, qualification, salary rate, the period and nature
of service and its date of effectivity, and such other terms and condition of employment as may be consistent with laws and rules, regulations and
standards of the school. A copy of the contract shall be furnished the personnel concerned.

It is important that the contract of probationary employment specify the period or term of its effectivity. The failure to stipulate its precise duration
could lead to the inference that the contract is binding for the full three-year probationary period. Therefore, the letters sent by petitioner Sr.

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LABOR RELATIONS
Atty. Jefferson M. Marquez

Bernadette, which were void of any specifics cannot be considered as contracts. The closest they can resemble to are that of informal
correspondence among the said individuals. As such, petitioner school has the right not to renew the contracts of the respondents, the old ones
having been expired at the end of their terms.

Assuming, arguendo, that the employment contracts between the school and the spouses were renewed, this Court finds that there was a valid
and just cause for their dismissal. The Labor Code commands that before an employer may legally dismiss an employee from the service, the
requirement of substantial and procedural due process must be complied with. Under the requirement of substantial due process, the grounds
for termination of employment must be based on just or authorized causes.

Of the charges against Remigio Michael, his spouse also shared the same defenses and admissions as to the charges against her.

The plain admissions of the charges against them were the considerations taken into account by the petitioner school in their decision not to
renew the respondent spouses' employment contracts. This is a right of the school that is mandated by law and jurisprudence. 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. Schools cannot be required to adopt standards
which barely satisfy criteria set for government recognition. The same academic freedom grants the school the autonomy to decide for itself the
terms and conditions for hiring its teacher, subject of course to the overarching limitations under the Labor Code. The authority to hire is likewise
covered and protected by its management prerogative — the right of an employer to regulate all aspects of employment, such as hiring, the
freedom to prescribe work assignments, working methods, process to be followed, regulation regarding transfer of employees, supervision of
their work, lay-off and discipline, and dismissal and recall of workers.

32. Lynvil Fishing Enterprises vs. Ariola, G.R. No. 181974, February 1, 2012

Facts:

Petitioner Lynvil Fishing Enterprises, Inc. (Lynvil) is engaged in deep-sea fishing. Respondents’ services were engaged in various capacities:
Andres G. Ariola, captain; Jessie D. Alcovendas, chief mate; Jimmy B. Calinao, chief engineer; Ismael G. Nubla, cook; Elorde Bañez, oiler; and
Leopoldo G. Sebullen, bodegero.

On Aug. 1, 1998, Lynvil received a report from Ramonito Clarido, one of its employees, that on July 31, 1998, he witnessed that while on board
the company vessel Analyn VIII, respondents conspired with one another and stole eight tubs of “pampano” and “tangigue” fish and delivered
them to another vessel.

Petitioner filed a criminal complaint against respondents before the office of the City Prosecutor of Malabon City which found probable cause for
indictment of respondents for the crime of qualified theft. Relying on the finding and Nasipit Lumber Company v. NLRC, 257 Phil. 937 (1989),
Lynvil asserted there was sufficient basis for valid termination of employment of respondents based on serious misconduct and/or loss of trust
and confidence.

Issues:

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LABOR RELATIONS
Atty. Jefferson M. Marquez

Whether a finding of the city prosecutor of probable cause to indict employees of qualified theft is sufficient basis for valid termination for serious
misconduct and/or loss of trust or confidence?

Whether the employees were validly terminated?

Ruling:

On the first issue, the Supreme Court ruled in the negative. We ruled that proof beyond reasonable doubt of an employee’s misconduct is not
required when loss of confidence is the ground for dismissal. It is sufficient if the employer has “some basis” to lose confidence or that the
employer has reasonable ground to believe or to entertain the moral conviction that the employee concerned is responsible for the misconduct
and that the nature of his participation therein rendered him absolutely unworthy of the trust and confidence demanded by his position.

Lynvil cannot argue that since the Office of the Prosecutor found probable cause for theft the Labor Arbiter must follow the finding as a valid
reason for the termination of respondents’ employment. The proof required for purposes that differ from one and the other are likewise different.

On the second question, the Court stated that nonetheless, even without reliance on the prosecutor’s finding, we find that there was valid cause
for respondents’ dismissal.

Just cause is required for a valid dismissal. The Labor Code provides that an employer may terminate an employment based on fraud or willful
breach of the trust reposed on the employee. Such breach is considered willful if it is done intentionally, knowingly, and purposely, without
justifiable excuse, as distinguished from an act done carelessly, thoughtlessly, heedlessly or inadvertently. It must also be based on substantial
evidence and not on the employer’s whims or caprices or suspicions otherwise, the employee would eternally remain at the mercy of the
employer. Loss of confidence must not be indiscriminately used as a shield by the employer against a claim that the dismissal of an employee
was arbitrary. And, in order to constitute a just cause for dismissal, the act complained of must be work-related and shows that the employee
concerned is unfit to continue working for the employer. In addition, loss of confidence as a just cause for termination of employment is premised
on the fact that the employee concerned holds a position of responsibility, trust and confidence or that the employee concerned is entrusted with
confidence with respect to delicate matters, such as the handling or care and protection of the property and assets of the employer. The betrayal
of this trust is the essence of the offense for which an employee is penalized. Breach of trust is present in this case.

However, Lynvil contends that it cannot be guilty of illegal dismissal because the private respondents were employed under a fixed-term contract
which expired at the end of the voyage. Contrarily, the private respondents (employees) contend that they became regular employees by reason
of their continuous hiring and performance of tasks necessary and desirable in the usual trade and business of Lynvil.

Jurisprudence, laid two conditions for the validity of a fixed-contract agreement between the employer and employee: first, the fixed period of
employment was knowingly and voluntarily agreed upon by the parties without any force, duress, or improper pressure being brought to bear
upon the employee and absent any other circumstances vitiating his consent; or second, it satisfactorily appears that the employer and the
employee dealt with each other on more or less equal terms with no moral dominance exercised by the former or the latter.

In the context of the facts that: (1) the respondents were doing tasks necessarily to Lynvil’s fishing business with positions ranging from captain
of the vessel to bodegero; (2) after the end of a trip, they will again be hired for another trip with new contracts; and (3) this arrangement

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LABOR RELATIONS
Atty. Jefferson M. Marquez

continued for more than ten years, the clear intention is to go around the security of tenure of the respondents as regular employees. And
respondents are so by the express provisions of the second paragraph of Article 280, thus: xxx Provided, That any employee who has rendered
at least one year of service, whether such service is continuous or broken, shall be considered a regular employee with respect to the activity in
which he is employed and his employment shall continue while such activity exists.

Having found that respondents are regular employees who may be, however, dismissed for cause as we have so found in this case, there is a
need to look into the procedural requirement of due process in Section 2, Rule XXIII, Book V of the Rules Implementing the Labor Code. It is
required that the employer furnish the employee with two written notices: (1) a written notice served on the employee specifying the ground or
grounds for termination, and giving to said employee reasonable opportunity within which to explain his side; and (2) 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. In this case, it is clear that the employees were not given the final written notices of dismissal.

The Court ruled that since employees were dismissed for just cause, they were not entitle to separation pay and backwages. However, they were
to be granted nominal damages for failure of the employer to comply with statutory due process.

33. D.M. Consunji Inc. vs. Jamin, G.R. No. 192514, April 18, 2012 citing Maraguinot

Facts:

On December 17, 1968, petitioner D.M. Consunji, Inc. (DMCI), a construction company, hired respondent Estelito L. Jamin as a laborer.
Sometime in 1975, Jamin became a helper carpenter. Since his initial hiring, Jamin’s employment contract had been renewed a number of times.
On March 20, 1999, his work at DMCI was terminated due to the completion of the SM Manila project. This termination marked the end of his
employment with DMCI as he was not rehired again.

On April 5, 1999, Jamin filed a complaint for illegal dismissal, with several money claims (including attorney’s fees), against DMCI and its
President/General Manager, David M. Consunji. Jamin alleged that DMCI terminated his employment without a just and authorized cause at a
time when he was already 55 years old and had no independent source of livelihood. He claimed that he rendered service to DMCI continuously
for almost 31 years. In addition to the schedule of projects (where he was assigned) submitted by DMCI to the labor arbiter, he alleged that he
worked for three other DMCI projects: Twin Towers, Ritz Towers, from July 29, 1980 to June 12, 1982; New Istana Project, B.S.B. Brunei, from
June 23, 1982 to February 16, 1984; and New Istana Project, B.S.B. Brunei, from January 24, 1986 to May 25, 1986.

DMCI denied liability. It argued that it hired Jamin on a project-to-project basis, from the start of his engagement in 1968 until the completion of
its SM Manila project on March 20, 1999 where Jamin last worked. With the completion of the project, it terminated Jamin’s employment. It
alleged that it submitted a report to the Department of Labor and Employment (DOLE) everytime it terminated Jamin’s services.

ISSUE

Whether there was violation of security of tenure.

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LABOR RELATIONS
Atty. Jefferson M. Marquez

RULING

Jamin worked for DMCI for almost 31 years, initially as a laborer and, for the most part, as a carpenter. Through all those years, DMCI treated
him as a project employee, so that he never obtained tenure. On the surface and at first glance, DMCI appears to be correct. Jamin entered into
a contract of employment (actually an appointment paper to which he signified his conformity) with DMCI either as a field worker, a temporary
worker, a casual employee, or a project employee everytime DMCI needed his services and a termination of employment paper was served on
him upon completion of every project or phase of the project where he worked.

The CA pierced the cover of Jamin’s project employment contract and declared him a regular employee who had been dismissed without cause
and without notice. To reiterate, the CA’s findings were based on: (1) Jamin’s repeated and successive engagements in DMCI’s construction
projects, and (2) Jamin’s performance of activities necessary or desirable in DMCI’s usual trade or business.

We agree with the CA. In Liganza v. RBL Shipyard Corporation, the Court held that "[a]ssuming, without granting[,] that [the] petitioner was
initially hired for specific projects or undertakings, the repeated re-hiring and continuing need for his services for over eight (8) years have
undeniably made him a regular employee." We find the Liganza ruling squarely applicable to this case, considering that for almost 31 years,
DMCI had repeatedly, continuously and successively engaged Jamin’s services since he was hired on December 17, 1968 or for a total of 38
times — 35 as shown by the schedule of projects submitted by DMCI to the labor arbiter and three more projects or engagements added by
Jamin, which he claimed DMCI intentionally did not include in its schedule so as to make it appear that there were wide gaps in his
engagements.

We reviewed Jamin’s employment contracts as the CA did and we noted that while the contracts indeed show that Jamin had been engaged as a
project employee, there was an almost unbroken string of Jamin’s rehiring from December 17, 1968 up to the termination of his employment on
March 20, 1999. While the history of Jamin’s employment (schedule of projects) relied upon by DMCI shows a gap of almost four years in his
employment for the period between July 28, 1980 (the supposed completion date of the Midtown Plaza project) and June 13, 1984 (the start of
the IRRI Dorm IV project), the gap was caused by the company’s omission of the three projects.

For not disclosing that there had been other projects where DMCI engaged his services, Jamin accuses the company of suppressing vital
evidence that supports his contention that he rendered service in the company’s construction projects continuously and repeatedly for more than
three decades. The non-disclosure might not have constituted suppression of evidence — it could just have been overlooked by the company —
but the oversight is unfair to Jamin as the non-inclusion of the three projects gives the impression that there were substantial gaps not only of
several months but years in his employment with DMCI.

To reiterate, Jamin’s employment history with DMCI stands out for his continuous, repeated and successive rehiring in the company’s
construction projects. In all the 38 projects where DMCI engaged Jamin’s services, the tasks he performed as a carpenter were indisputably
necessary and desirable in DMCI’s construction business. He might not have been a member of a work pool as DMCI insisted that it does not
maintain a work pool, but his continuous rehiring and the nature of his work unmistakably made him a regular employee. In Maraguinot, Jr. v.
NLRC, the Court held that once a project or work pool employee has been: (1) continuously, as opposed to intermittently, rehired by the same
employer for the same tasks or nature of tasks; and (2) these tasks are vital, necessary and indispensable to the usual business or trade of the
employer, then the employee must be deemed a regular employee.

Further, as we stressed in Liganza, "[r]espondent capitalizes on our ruling in D.M. Consunji, Inc. v. NLRC which reiterates the rule that the length
of service of a project employee is not the controlling test of employment tenure but whether or not ‘the employment has been fixed for a specific
project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee.’"

Page 87

Jamin’s case fits squarely into the employment situation just quoted. Page 88 . His employment ceased to be coterminous with specific projects when he was repeatedly re-hired due to the demands of petitioner’s business. LABOR RELATIONS Atty. it is vital in determining if the employee was hired for a specific undertaking or tasked to perform functions vital." Without doubt. Marquez "Surely. necessary and indispensable to the usual business or trade of the employer. Nevertheless. Jefferson M. length of time is not the controlling test for project employment. [private] respondent had been a project employee several times over. Here.

Marquez MANAGEMENT PREROGATIVE 1. assuming for the sake of argument that the communication or letter of Mr. prefer to remain in his position. Jefferson M. on the other hand. of Manager-Philippines until such time that his services in that capacity are no longer required by the company." The inter-office communication of Vice President Jenkins is captioned "Transfer" but it is basically and essentially a promotion for the nature of an instrument is characterized not by the title given to it but by its body and contents. 1975. petitioner's inability or his refusal to be transferred was not a valid cause for dismissal. higher either in rank or salary. LABOR RELATIONS Atty.A. the Supreme Court. Jenkins was basically a transfer. Dosch vs. Issues: Does the employer’s letter constitute a transfer as a valid exercise of a management prerogative? Assuming arguendo that the communication or letter of Mr. Promotion. is the advancement from one position to another with an increase in duties and responsibilities as authorized by law. the latter being merely incidental to such promotion. he was to be promoted to the position of Director of International Sales. He received an inter-office communication from R. Dosch in his letter. Whereas. and his compensation would be upgraded and the payroll accordingly adjusted. without break in the service. speaking thru Acting Chief Justice J. Jenkins was basically a transfer. He has to his credit eleven (11) years of continuous service with the company. he was exercising a right and he cannot be punished for it as qui jure suo utitur neminem laedit. effective immediately. his status as an employee of the company ceased on the close of business and the company therefore considers his letter to be a resignation without notice. promoting him to the position of Director of International Sales and transferring him to Northwest's General Office in Minneapolis. In the Millares case above. distinguished between transfer and promotion as follows: "A transfer is a movement from one position to another of equivalent rank. Petitioner tried to resume his duties as Manager after an authorized vacation but the Vice-President for the Orient Region of Northwest advised petitioner that in view of his letter. Reyes.S.. "it is more in the nature of a promotion that a transfer. which a person has a right to refuse. an American citizen. under the particular and peculiar facts obtaining in the case at bar. 123 SCRA 296 [1983] Facts: Helmut Dosch. was the resident Manager of Northwest Airlines.A. U. as a promotion is in the nature of a gift or a reward. Jenkins. therefore. transfer refers to lateral movement from one position to another. therefore. level or salary. higher either in rank or salary. married to a Filipina. U. Northwest's Vice President for Orient Region based in Tokyo.B. does Dosch's inability or refusal to be transferred a valid cause for dismissal? Rulings: No. It has been held that promotion denotes a scalar ascent of an officer or an employee to another position. including nine (9) years as Northwest Manager with station at Manila. promotion denotes a scalar ascent of a senior officer or employee to another position. No. under the particular and peculiar facts obtaining in the case at bar.S. he is unable to accept a transfer from the Philippines and that he would. It is not merely a transfer order alone but as the Solicitor General correctly observes. level or salary. When petitioner refused to accept his promotion to Director of International Sales. Jenkins’ letter is a letter directing the promotion of Dosch from his position as Philippine manager to Director of International Sales in Minneapolis. advanced to a higher position and rank and his salary was increased and that is a promotion. of equivalent rank. He who uses his own legal right injures no one." There is no law that compels an employee to accept a promotion. expressed appreciation for the promotion and at the same time regretted that "for personal reasons and reasons involving his family. NLRC. in the Philippines. Petitioner was.L. While it may be true that Page 89 . Inc. and usually accompanied by an increase in salary.C. The communication informed the petitioner that effective August 18.

L-48235-36. PT&T v. its existing branches and the number of employees. Unemployment brings untold hardships and sorrows on those dependent on the wage-earner. to quote from Bultmann. the private respondents and other petitioner’s employees were directed to “relocate” to their new PT&T Branches. International Ceramics Manufacturing Co. 152057. Discretionary Justice. And neither capital nor labor shall act oppressively against each other (Article 1701. It employed various employees. such right is not absolute. No. Thereafter.F. 1979. giving them the option to choose the branch to which they could be transferred. in addition his family to consider. It is not only because of the law's concern for the workingman. petitioners should not be deprived of their means of livelihood. considering the length of service that petitioner has rendered for eleven (11) fruitful and loyal years. (b) decongest surplus workforce in some branches. For all this to condone what had been done by them. Their main concern is the proximity of their transfer. New Civil Code). The private respondents rejected the petitioner’s offer. Goodrich Philippines. Jefferson M. G.. Such an order constitutes removal without just cause and is illegal." (This excerpt was cited in Almira vs. Inc. The petitioner offered benefits/allowances to those employees who would agree to be transferred under its new program. a strong and vital factor that must be taken into account in labor law determinations which this Court. they had not been paid. Dissatisfied with this explanation. the private respondents were dismissed from work. (c) lower expenses incidental to hiring and training new personnel. 92 SCRA 412 emphasized should not only be secundum rationem but also secundum caritatem. hence. They forthwith filed their Page 90 . There can be no dispute that the constitutional guarantee of security of tenure mandated under Section 9. New Civil Code). to promote efficiency and productivity. LABOR RELATIONS Atty. the petitioner came up with a Relocation and Restructuring Program designed to (a) sustain its (PT&T’s) retail operations. 131. The misery and pain attendant on the loss of jobs then could be avoided if there be acceptance of the view that under all the circumstances of this case. speaking thru Chief Justice Fernando in Meracap vs.. 1973 Constitution applies to all employees and laborers. Court of Appeals. to decline a promotion where. September 23. among whom were herein private respondents. since private respondent considered them separated from the service. Nor is this to condone what had been done by them. On August 11. Sometime in 1997. The fact that petitioner is a managerial employee does not by itself exclude him from the protection of the constitutional guarantee of security of tenure. Even a manager in a private concern has the right to be secure in his position. 2003 Facts: The petitioner is a domestic corporation engaged in the business of providing telegraph and communication services thru its branches all over the country. Inc. The affected employees were directed to report to their respective relocation assignments in a Letter dated September 16. Indeed. 58 SCRA 120. to follow Davis in his masterly work. the outright dismissal of petitioner from his position as Manager- Philippines of Northwest Airlines is much too severe. B.) 2. all the equities of the case must be accorded their due weight. For the strictly juridical standpoint. private respondents received separate letters from the petitioner. The right of an employer to freely select or discharge his employee is limited by the paramount police power for the relations between capital and labor are not merely contractual but impressed with public interest (Article 1700. 1997. although the promotion carries an increase in his salary and rank but results in his transfer to a new place of assignment or station and away from his family.R. whether in the government service or in the private sector. For all this while. Article 2. Marquez the right to transfer or reassign an employee is an employer's exclusive right and the prerogative of management. 1997.. Finally. after conducting a series of studies regarding the profitability of its retail operations. that it would be burdensome for them to leave their families and relocate to those areas. to wit: "It would imply at the very least that where a penalty less punitive would suffice. whatever missteps may be committed by labor ought not to be visited with a consequence so severe. it cannot be too strongly stressed. labor law determinations. should be not only secundum rationem but also secundum caritatem. that where a decision may be made to rest on informed judgment rather than rigid rules. and (d) avoid retrenchment of employees occupying redundant positions. the petitioner considered the private respondents’ refusal as insubordination and willful disobedience to a lawful order. July 30. There is.

as their transfer was prejudicial and inconvenient. the petitioner adverted that when the private respondents were transferred. Ruling: The petition is denied due course. They are being moved to branches where the complainants will function with maximum benefit to the company and they were in fact promoted not demoted from a lower job-grade to a higher job-grade and receive even higher salaries than before. as we defined in Millares v. Although the increase in the pay is not significant this however would be translated into an increase rather than decrease in their salary because the complainants who were transferred from the city to the province would greatly benefit because it is of judicial notice that the cost of living in the province is much lower than in the city. there can be no valid justification in dismissing the private respondents. LABOR RELATIONS Atty. Issue: WON the transfer was tantamount to a promotion. there can be no insubordination in refusing such promotion and subsequently. Jefferson M. thus: Clearly. following the ruling enunciated in Homeowners Savings and Loan Association. the transfer was indeed in a nature of a promotion. transfer of the complainants would not also result in diminution in pay benefit and privilege since the salaries of the complainant would be receiving a bigger salary if not the same salary plus additional special relocation package.” Apparently. filed a complaint against the petitioner for illegal dismissal and unfair labor practice before the arbitration branch of the NLRC. the indispensable element for there to be a promotion is that there must be an “advancement from one position to another” or an upward vertical movement of the employee’s rank or position. YES. Inc. With or without a corresponding increase in salary. v. In its position with the labor arbiter. they were also promoted. the private respondents’ bargaining agent. and usually accompanied by an increase in salary. In their position paper. Thus. the petitioner (respondent therein) alleged that the private respondent’s transfers were made in the lawful exercise of its management prerogative and were done in good faith. The transfers were aimed at decongesting surplus employees and detailing them to a more demanding branch. the transfer of the complainants is not unreasonable nor does it involve demotion in rank. For its part. Page 91 . Hence. the respective transfer of the private respondents was in fact promotions. is “the advancement from one position to another with an increase in duties and responsibilities as authorized by law. PT&T Workers Union-NAFLU-KMU. the complainants (herein private respondents) declared that their refusal to transfer could not possibly give rise to a valid dismissal on the ground of willful disobedience. Marquez respective complaints against the petitioner before the appropriate sub-regional branches of the NLRC. WON private respondents committed insubordination in refusing such promotion/transfer which would then justify PT&T’s act of dismissing them in exercise of management prerogative. Subsequently. the increase in the respondents’ responsibility can be ascertained from the scalar ascent of their job grades. NLRC: … [P]romotion. This would mean a higher purchasing power of the same salary previously being received by the complainants. thus unreasonable. Indeed. Subido. And if it is.

without his consent. 99-52 and 99-53. Rural Bank of Lucban. This can be likened to the upgrading of salaries of government employees without conferring upon the. this resolution does not preclude the transfer of assignment of bank officers and employees from the branch office to the head office and vice-versa. 99-52 “‘RESOLVED AS IT IS HEREBY RESOLVED’ that in line with the policy of the bank to familiarize bank employees with the various phases of bank operations and further strengthen the existing internal control system[. 1999. That it resulted to unfair labor practice. which read: “Board Res. There is no law that compels an employee to accept a promotion for the reason that a promotion is in the nature of a gift or reward. the NLRC correctly ordered the private respondents’ reinstatement without loss of seniority rights and the payment of backwages from the time of their dismissal up to their actual reinstatement. the Decision of the Court of Appeals dated June 15. SO ORDERED. even if merely as a result of a transfer.. Daya replied that it was never the intention (of management) to downgrade Page 92 . No. advancement or reduction or a transfer that aims to ‘lure the employee away from his permanent position cannot be done without the employees’ consent. The admissions of the petitioner are conclusive on it. A transfer that results in promotion or demotion. Mendoza vs. the exercise by the private respondents of their right cannot be considered in law as insubordination. Hence. the Board of Directors of the Rural Bank of Lucban. G. that the reshuffling deemed to be a demotion without any legal basis and is a blatant harassment on from the employer as a prelude petitioners termination in due time. LABOR RELATIONS Atty. Jefferson M. or willful disobedience of a lawful order of the employer. No. which a person has a right to refuse. An employee cannot be promoted. Inc. 2001 is hereby AFFIRMED. the concomitant elevation to the higher positions…. 2004 Facts: On April 25. IN LIGHT OF THE ALL THE FOREGOING. there was no valid cause for the private respondents’ dismissal. Moreover. Marquez Any increase in salary should only be considered incidental but never determinative of whether or not a promotion is bestowed upon an employee. issued Board Resolution Nos.] all officers and employees are subject to reshuffle of assignments. As the questioned dismissal is not based on any of the just or valid grounds under Article 282 of the Labor Code. As such. 3.” Petitioner Elmer Mendoza expressed his opinion on the reshuffle in an undated letter addressed to Daya. July 7. bank board chairman.R. 155421.

Tecson signed a contract of employment. 4. or any diminution of his salary. but also the right of employers. Tecson and Bettsy.R. The law must protect not only the welfare of employees. 1999 letter of Daya to petitioner. LABOR RELATIONS Atty. that he agrees to disclose existing or future relationship with co-employees and employees of competing companies that should such relationship poses a conflict of interest. which stipulates among others. got married. and other privileges. privileges and other benefits. management has the prerogative to transfer or assign employees from one office or area of operation to another -.provided there is no demotion in rank or diminution of salary. Despite repeated warnings. Alejo B. We have previously held that employees may be transferred -. Marquez petitioner’s position. separation pay and damages against the Rural Bank of Lucban and/or its president. Ruling: Management Prerogative to Transfer Employees. and the May 10. aptitudes and competencies -. 1999 letter of Bank President Daya to Branch Manager Cada. of Detailman-PTFWO vs Glaxo Wellcome Phils. Duncan Assn. and the action is not motivated by discrimination. For this reason. Issue: Whether or not the reshuffling or transfer is deemed to be a demotion on petitioner’s position. underpayment. Petitioner’s Transfer Lawful. other employees were also reassigned without their express consent. In the pursuit of its legitimate business interest. as medical representative. Jefferson M. This privilege is inherent in the right of employers to control and manage their enterprise effectively. This fact is clear in respondent’s Board Resolutions. There appears no justification for denying an employer the right to transfer employees to expand their competence and maximize their full potential for the advancement of the establishment. 1999 petitioner filed a Complaint for illegal dismissal. and that the reshuffle will also afford management an effective tool in providing the bank a sound internal control system/check and balance and a basis in evaluating the performance of each employee. Glaxo transferred Tecson to Butuan. Petitioner availed 30 days in total leave of absence and on June 24. to resign from the company. Cada. Indeed. Issue: Page 93 . labor laws discourage interference in employers’ judgments concerning the conduct of their business. Petitioner was not singled out. the April 30. an employee of a competing company. Jurisprudence recognizes the exercise of management prerogatives. but he defied such orders and continued acting as medical representative in Camarines area. The right of employees to security of tenure does not give them vested rights to their positions to the extent of depriving management of its prerogative to change their assignments or to transfer them. benefits. Daya. Neither was there any demotion in the rank of petitioner. The National Conciliation and Mediation board rendered as valid the policy and the right to transfer. G.based on their qualifications. and its Tayabas branch manager. courts often decline to interfere in legitimate business decisions of employers. 162994 Facts: Petitioner Tecson was hired by respondent Glaxo Wellcome Phils.to positions in which they can function with maximum benefit to the company. Petitioner’s transfer was made in pursuit of respondent’s policy to “familiarize bank employees with the various phases of bank operations and further strengthen the existing internal control system” of all officers and employees. or effected as a form of punishment or demotion without sufficient cause. made in bad faith. Briccio V.

she reiterated this request to be assigned anew in Naga City while waiting for the resolution of her case. 2002. employed private respondent Ma. The company did not accede to her requests and she continued reporting at the main office performing whatever work assigned to her. Glaxo has a right to guard its trade secrets. 5. she had no choice but to stick to her appointment as Senior BCO-Bicol Region and Samar there being no superseding memo changing her assignment. She expressed that the situation has become unbearable for her so that she is forced to report back to Naga City effective March 24. 2002. Ruling: No. 2003. LABOR RELATIONS Atty. carries the penalty of dismissal. maintained her position that she could no longer report to the Home Office after the company withdrew her monthly “TNT. G. the company withheld the Transportation and Travel Allowance (TNT) being received by private respondent amounting to P7. private respondent received a memo from the IAP for an investigation on the charges of abandonment of work. The policy being questioned is not a policy against marriage. marketing strategies and other confidential programs and information for competitors. In August and September 2002. Jefferson M. Glaxo’s policy prohibiting an employee from having a relationship is a valid exercise of management prerogatives as relationships of that nature might compromise the interests of the company. however.. however. The right to protect its economic interests is recognized by the constitution which recognizes the right of enterprises to adopt and enforce such a policy to protect its right to reasonable returns on investments and for expansion and growth. and directing Page 94 . Indeed. 2001. initially trained as administration and finance officer assigned to the company’s branch at Calamba.” She asserted that considering her difficult situation. However. The policy is aimed at restricting a personal prerogative that belongs only to the individual. On July 29. 2003. On January 24. private respondent made a written “Request for Re-assignment” to be assigned as Cashier of the Naga Branch which is vacant and considering that she is a resident of Naga City and a mother of three growing kids. 1990. 2005 Facts: Petitioner Norkis Trading Co. while our laws endeavor to give life to the constitutional policy on social justice and the protection of labor. No. For the period March 18-April 1. As such.R. NLRC. private respondent was informed about a recent company audit which disclosed that she had disregarded the detailed instructions of her superior and failed to perform her duties as a Senior Branch Control Officer. She was ordered to report back to the main office and to explain why no disciplinary action should be taken against her for abandonment of work. she was promoted as Acting Senior Branch Control Officer for Bicol Region. In a memorandum dated May 22.00. August 19. such as monitoring of collections at Cubao Branch.555. She wrote a letter to the management criticizing them for wanting to ease her out of the company due to a labor case filed by her husband. she was instructed by her immediate superior to confirm transactions pertaining to collections and deposits of BCO Marivic Faura at Polangui. An employee of the company remains free to marry anyone of his or her choosing. which under existing company policy. Arlene C. Inc. an employee’s personal decision does not detract the employer from exercising management prerogatives to ensure maximum profit and business success. private respondent also requested to be furnished a copy of the minutes and audit report of the IAP investigation.. 2003. The challenged company policy does not violate the equal protection clause of the constitution as such clause is addressed only to the state or those acting under color of its authority. 168159. Marquez Whether or not the policy constitutes a prohibition against marriage. The law also recognized that management has rights which are also entitled to respect and enforcement in the interest of fair play. and such withdrawal of her travel allowances is calculated to cause suffering on her part. insubordination and refusal to report back to the place of work. private respondent learned that the management instructed to deny her entry to the branch premises and access to company records.” After the hearing of the IAP was concluded. prompting her to formally protest her “questionable assignment” at the Home Office in Mandaluyong City which she insisted is against her appointment as Senior BCO for Bicol Region and Samar. Norkis Trading Co. manufacturing formulas. Laguna. there being no written order issued by the management for her to stay in the main office. An investigation by the company’s Internal Audit Group ensued and private respondent was formally charged with “Negligence Resulting to Material Loss. vs. Upon returning to Naga City. who also worked at Norkis for more than 13 years. it does not mean that every labor dispute will be decided in favor of the workers. Gnilo on March 8. Private respondent. On April 14.

processes to be followed. On April 30. is not absolute as it is subject to limitations imposed by law. which she failed to attend because the company did not act on her request to allow her cash advances to defray her travel expenses. time. collective bargaining agreements. and moral and exemplary damages. (PLDT) has 27 Exchanges in its Greater Metro Manila (GMM) Network. VP criticizing the PLDT criteria for performance rating as unfair because they depended on manpower after receiving its appraisal rating. He also suggested that the criteria failed Page 95 . The management’s right to transfer or re-assign its personnel. Petitioner contends that its acts were legitimate exercises of the corporation’s management prerogative and that the private respondent was guilty of insubordination and willful disobedience justifying her the termination. however. 152689. PLDT vs. working methods. under the broad concept of management prerogative. with claims for nonpayment of salaries. and praying for reinstatement with full back wages. Issues: What are the scope and the limitations on the exercise of management prerogatives. the company terminated her services effective May 2. place and manner of work. 2005 Facts: Petitioner Philippine Long Distance Telephone Company. The managerial prerogative to transfer personnel must be exercised without grave abuse of discretion. It is the employer’s prerogative. transfer of employees. G. and the dismissal and recall of workers. inconvenient or prejudicial to the employee. tools to be used. benefits. No. on appeal. the employer must be able to show that the transfer is not unreasonable. aptitudes. and attorney’s fees. supervision of workers. nor prejudicial to him. work supervision. 13th month pay. service incentive leave pay. 2003. prompting her to file a case with the NLRC on April 21. bearing in mind the basic elements of justice and fair play. In particular. to move them around in the various areas of its business operations in order to ascertain where they will function with maximum benefit to the company. privileges and other benefits. October 12. Alfredo S. Should the employer fail to overcome this burden of proof. and general principles of fair play and justice. affirmed the decision. nor does it involve a demotion in rank or a diminution of his salaries. particularly on the transfer of employees? What is the test to determine the validity of the transfer of employees? Ruling: Concededly. work assignments.R. it cannot be used as a subterfuge by the employer to rid himself of an undesirable worker. and other privileges. The Labor Arbiter found Norkis guilty of illegal dismissal and the NLRC and the Court of Appeals. 2003 at the main office. Marquez her to attend a hearing set on April 16. and competence. Inc. Having the right should not be confused with the manner in which that right is exercised. nor inconvenient. Paguio was the Head of the Garnet Exchange who sent a letter to his immediate supervisor and Asst. When his transfer is not unreasonable. Thus. and it does not involve a demotion in rank or a diminution of his salaries. to regulate all aspects of personnel administration including hiring. 2003. An employee’s right to security of tenure does not give him such a vested right in his position as would deprive the company of its prerogative to change his assignment or transfer him where he will be most useful. employers are allowed. the employee’s transfer shall be tantamount to constructive dismissal. lay-off of workers. 2003 for the reason that the situation had become unbearable for her tantamount to constructive dismissal. Paquio. Jefferson M. based on its assessment and perception of its employees’ qualifications. 6. LABOR RELATIONS Atty. Her salary then was withheld. the employee may not complain that it amounts to a constructive dismissal. working regulations.

It is the employer’s prerogative. By its very nature. we see no credible reason for Paguio’s transfer except his criticisms of the company’s performance evaluation methods. the petitioner asks this Court to resolve now the legality of Paguio’s transfer. An employee’s right to security of tenure does not give him such a vested right in his position as would deprive the company of its prerogative to change his assignment or transfer him where he will be most useful. That prerogative accorded management should not defeat the very purpose for which our labor laws exist: to balance the conflicting interests of labor and management. obtained the top rating in the GMM. He was then advised to transfer to any group in the company that may avail of his services.” Illegal demotion is a type of illegal transfer. Garnet Exchange was doing well and excelled in the performance rating. The employer bears the burden of proving that the transfer of the employee has complied with the foregoing test. Findings were that the memo was in order as it was based on the finding that Paguio was not a team player and cannot accept decisions of management. An employer is free to regulate. Believing that his transfer was a disciplinary action. Issue: In brief. In the present case. Based on the undisputed facts. there are limits to the management prerogative. and competence. aptitudes. inconvenient or prejudicial to the employee. In the same way. Despite Paguio’s criticism. we note from the records that there has been no change of cause of action from “illegal demotion” to “illegal transfer. damages and attorney’s fees. LABOR RELATIONS Atty. Neither was it because he was needed in the new post for the new assignment was functionless and it was nothing but a title. management prerogative must be exercised always with the principles of fair play and justice. Marquez to recognize that exchanges with new plants could easily meet the objectives of GMM compared to those with old plants. the employer must be able to show that the transfer is not unreasonable. There was also no proof that Paguio refused to comply with any management policy. claiming it was unfair to Garnet Exchange because as the oldest exchange in the East Center. it was disallowed to use contractors for new installations and was not made beneficiary of the cut-over bonus. PLDT rebalanced the manpower of the East Center. In particular. another memo informed Paguio that his transfer was not in the nature of a disciplinary action that required investigation and that he agreed with the reasons of the transfer. Aggrieved. his transfer could not be due to poor performance. to deploy its employees in the various areas of its business operations in order to ascertain where they will function with maximum benefit to the company. the exercise of management prerogative cannot be utilized to circumvent the law and public policy on labor and social justice. Nonetheless. the oldest plant in GMM. Paguio files a complaint for illegal dismissal with prayer for reinstatement and damages which was later amended to illegal demotion with prayer for reversion to old position. Jefferson M. it is familiar and fundamental doctrine that it is not the title of the action but the allegations in the pleading that determines the nature of the action. based on its assessment and perception of its employees’ qualifications. Likewise. Paguio’s transfer could only be caused by the management’s negative reception of his comments. Ruling: PLDT alleges that the NLRC ruling would allow a change of cause of action since the complaint alleged “illegal demotion” while the decision involved “illegal transfer. It is prejudicial to Paguio because it left him out for a possible promotion as he was assigned to a functionless position with neither office nor staff. He also filed a complaint against his supervisor for grave abuse of authority and manipulation of the East Center performance. according to his own discretion and judgment. all aspects of employment. Paguio reiterated his letter to Santos and objected to the performance rating as it was based only on the attainment of objectives. without considering other relevant factors. Paguio’s performance was consistently rated as outstanding. Two years later on June 1996.” Prefatorily. which is short of insubordination. including the transfer of employees. Paguio wrote Santos and requested reconsideration of the manpower rebalancing. Patently. Garnet Exchange. privileges and other benefits. nor does it involve a demotion in rank or a diminution of his salaries. He was then was reassigned as Head for Special Assignment at the Office of the GMM East Center and asked to turn over his functions as Garnet Exchange Head to Tessie Go. Nevertheless. Paguio requested the first VP for a formal hearing of the charges against him and asked that his reassignment be deferred. While it may be conceded that management is in the best position to know its operational needs. Moreover. Page 96 .

April 12. 7. 164774. Simbol and Comia allege that they did not resign voluntarily. As to respondent Estrella. Simbol. Page 97 . After he got her pregnant. No. On November 30. LABOR RELATIONS Atty. after submission of the explanation. However. or to actually dismiss. 1999 but she found out that her name was on-hold at the gate. she met an accident and was advised by the doctor at the Orthopedic Hospital to recuperate for twenty-one (21) days. She returned to work on December 21. Marquez Hence. Respondents later filed a complaint for unfair labor practice. They averred that the aforementioned company policy is illegal and contravenes Article 136 of the Labor Code. discharge. she discovered that he was not separated. or to stipulate expressly or tacitly that upon getting married a woman employee shall be deemed resigned or separated. The memorandum stated that she was being dismissed for immoral conduct. 1999. The Civil Code likewise protects labor with the following provisions such as articles 1700 and 1702. 136. Jefferson M. The Labor Code is the most comprehensive piece of legislation protecting labor. Article XIII. She was denied entry. The case at bar involves Article 136 of the Labor Code which provides: Art. constructive dismissal.R. Thus. Ruling: The Supreme Court held that The 1987 Constitution under Article II. they were compelled to resign in view of an illegal company policy. Issue: Whether or not the 1995 Policy/Regulation of the company is violative of the Constitutional rights towards marriage and the family of employees and of article 136 of the Labor Code. 2006 Facts: According to the respondents. G. Due to her urgent need for money. Star Paper Corp. It shall be unlawful for an employer to require as a condition of employment or continuation of employment that a woman employee shall not get married. She refused to sign the memorandum because she was on leave for twenty-one (21) days and has not been given a chance to explain. separation pay and attorney’s fees. transfer was not valid. she later submitted a letter of resignation in exchange for her thirteenth month pay.. discriminate or otherwise prejudice a woman employee merely by reason of her marriage. she was nonetheless dismissed by the company. The management asked her to write an explanation. She was directed to proceed to the personnel office where one of the staff handed her a memorandum. she severed her relationship with him to avoid dismissal due to the company policy. Section 3 state our policy towards the protection of labor under the following provisions. she alleges that she had a relationship with co-worker Zuñiga who misrepresented himself as a married but separated man. Section 18. vs.

where the particular requirements of the job would justify the same. LABOR RELATIONS Atty. albeit disproportionate. but were asked to resign when they married a co-employee. NLRC. In said case. Marquez In denying the contention of the petitioner company. The requirement that a company policy must be reasonable under the circumstances to qualify as a valid exercise of management prerogative was also at issue in the 1997 case of Philippine Telegraph and Telephone Company v. Petitioners contend that their policy will apply only when one employee marries a co-employee. If we uphold the questioned rule without valid justification. Jefferson M. The cases of Duncan and PT&T instruct us that the requirement of reasonableness must be clearly established to uphold the questioned employment policy. Decision Page 98 . The employer has the burden to prove the existence of a reasonable business necessity. could be detrimental to its business operations. Neither did petitioners explain how this detriment will happen in the case of Wilfreda Comia. but not on the ground of a general principle. the employer must prove two factors: (1) that the employment qualification is reasonably related to the essential operation of the job involved. That the second paragraph was meant to give teeth to the first paragraph of the questioned rule is evidently not the valid reasonable business necessity required by the law. respondents were hired after they were found fit for the job. Petitioners failed to show how the marriage of Simbol. We held that the company policy violates the right against discrimination afforded all women workers under Article 136 of the Labor Code. who married Howard Comia. but they are free to marry persons other than co- employees. then a Sheeting Machine Operator.: A requirement that a woman employee must remain unmarried could be justified as a “bona fide occupational qualification. the SC applied the two factors to justify a bona fide occupational qualification: Since the finding of a bona fide occupational qualification justifies an employer’s no-spouse rule. (2) that there is a factual basis for believing that all or substantially all persons meeting the qualification would be unable to properly perform the duties of the job. the employer can create policies based on an unproven presumption of a perceived danger at the expense of an employee’s right to security of tenure. The failure of petitioners to prove a legitimate business concern in imposing the questioned policy cannot prejudice the employee’s right to be free from arbitrary discrimination based upon stereotypes of married persons working together in one company. A requirement of that nature would be valid provided it reflects an inherent quality reasonably necessary for satisfactory job performance. effect. The SC does not find a reasonable business necessity in the case at bar. then a Production Helper in the Selecting Department. The policy is premised on the mere fear that employees married to each other will be less efficient. To justify a bona fide occupational qualification. but established a permissible exception. the only way it could pass judicial scrutiny is a showing that it is reasonable despite the discriminatory. Petitioners’ sole contention that “the company did not just want to have two (2) or more of its employees related between the third degree by affinity and/or consanguinity” is lame. The questioned policy may not facially violate Article 136 of the Labor Code but it creates a disproportionate effect and under the disparate impact theory. the employee was dismissed in violation of petitioner’s policy of disqualifying from work any woman worker who contracts marriage. The burden was successfully discharged in Duncan but not in PT&T. It is significant to note that in the case at bar. then an employee of the Repacking Section. the exception is interpreted strictly and narrowly. to Alma Dayrit. viz. There must be a compelling business necessity for which no alternative exists other than the discriminatory practice. such as the desirability of spreading work in the workplace. then a helper in the cutter-machine. and.” or BFOQ.

and finally as assistant manager. Solidbank. Waiver and Quitclaim. requiring the parties to present evidence to support their respective claims. 1995. he became the Manager of the bank’s Credit Investigation and Appraisal Division of the Consumer's Banking Group. and that any breach of the Undertaking or the provisions of the Release. directly or indirectly engage in any unlawful activity prejudicial to the interest of Solidbank. 1995. Upon learning this. Jefferson M. foolish or disastrous contract. its plans. Ruling: The petition is meritorious. Courts have no jurisdiction to look into the wisdom of the contract entered into by and between the parties or to render a decision different therefrom. 1995. senior clerk. petitioner executed the Release. Page 99 .28 from respondent. officers. In the meantime. Marquez of the CA affirmed. He acknowledged receipt of the net proceeds of his separation and retirement benefits and promised that "he would not. Then promoted as credit investigator. assistant accountant. agents or employees. informing Rivera that he had violated the Undertaking and demanded the return of all the monetary benefits he received in consideration of the SRP within five (5) days from receipt. otherwise. and the Undertaking as supplement thereto. Such a contract will not be discarded even if there was a mistake of law or fact. under which an employee would receive 85% of his monthly basic salary multiplied by the number of years in service. We agree with petitioner's contention that the issue as to whether the post-retirement competitive employment ban incorporated in the Undertaking is against public policy is a genuine issue of fact. their stockholders. 1977. Solidbank wrote a letter dated May 18. 163269. In December 1994. its parent. entered into with full awareness of what he was doing and entered into and carried out in good faith. appropriate legal action would be taken against him. under which a retiring employee would receive 250% of the gross monthly salary multiplied by the number of years in service. and their successors-in-interest and will not disclose any information concerning the business of Solidbank. Waiver and Quitclaim would entitle Solidbank to a cause of action against him before the appropriate courts of law”. G. LABOR RELATIONS Atty. which was notarized on March 1.619. in consideration for his availment of the SRP. simply because their contracts turned out to be disastrous deals. Rivera got employed with Equitable Banking Corporation (Equitable) as Manager of its Credit Investigation and Appraisal Division of its Consumers' Banking Group. and that he received retirement pay amounting to P963. processes. Rivera vs. The well-entrenched doctrine is that the law does not relieve a party from the effects of an unwise. or data of any kind. affiliate or subsidiary companies. its manner or operation. No. contrary to public policy. Rivera decided to devote his time and attention to his poultry business in Cavite and applied for retirement under the SRP. and (b) the Special Retirement Program (SRP). directors. 1995. Issue: Whether the employment ban incorporated in the Undertaking which petitioner executed upon his retirement is unreasonable. 2006 Facts: Rivera started working with Solidbank Corporation as an audit clerk since July 1. Prior to his retirement.R. There is no dispute between the parties that. Solidbank approved the application and confirmed his separation from Solidbank on February 25. at any time. oppressive. However. Waiver and Quitclaim. Solidbank required Rivera to sign an undated Release. April 19. 8. hence." He also signed in an Undertaking upon which he promised that "not to seek employment with a competitor bank or financial institution within one (1) year from February 28. Solidbank offered two retirement programs to its employees: (a) the Ordinary Retirement Program (ORP). They have no power to relieve parties from obligation voluntarily assailed. 1995. in any manner whatsoever. But on May 1. Rivera and his brother-in-law put up a poultry business in Cavite.

Branch 261.. Tiu was its Division Marketing Director. 163512. thus. skill and good judgment has built up. after all. petitioner stopped reporting for work. A provision on territorial limitation is necessary to guide an employee of what constitutes as violation of a restrictive covenant and whether the geographic scope is co-extensive with that in which the employer is doing business. 56 Freedom to contract must not be unreasonably abridged. engage in competitive employment. Inc. 2007 Facts: Platinum Plans Philippines. No. Consideration must be given to the employee's right to earn a living and to his ability to determine with certainty the area within which his employment ban is restituted. What one creates by his own labor is his. from assailing the post-retirement competitive employment ban since under Article 1409 of the New Civil Code. Inc. But it is just as important to protect the enjoyment of an establishment in trade or profession. A post-retirement competitive employment restriction is designed to protect the employer against competition by former employees who may retire and obtain retirement or pension benefits and. From 1987 to 1989. the facts and circumstances surrounding the case must be considered. which its employer has built up by his own honest application to every day duty and the faithful performance of the tasks which every day imposes upon the ordinary man. The parties executed a contract of employment valid for five years. she became the Vice-President for Sales of Professional Pension Plans. Undeniably. public order or public policy are inexistent or void from the beginning. Neither must the right to protect by reasonable restrictions that which a man by industry. good customs. object or purpose is contrary to law. are intended to help the employee enjoy the remaining years of his life. We are not impervious of the distinction between restrictive covenants barring an employee to accept a post-employment competitive employment or restraint on trade in employment contracts and restraints on post-retirement competitive employment in pension and retirement plans either incorporated in employment contracts or in collective bargaining agreements between the employer and the union of employees. that Page 100 . alleging. Retirement benefits. In considering a territorial restriction.619. petitioner retired under the SRP and received P963. is burdened to establish that a restrictive covenant barring an employee from accepting a competitive employment after retirement or resignation is not an unreasonable or oppressive. (d) whether the time and territorial limitations contained in the covenant are reasonable.R. retirement plans. or separate from said contracts or collective bargaining agreements which provide that an employee who accepts post retirement competitive employment will forfeit retirement and other benefits or will be obliged to restitute the same to the employer. is a domestic corporation engaged in the pre-need industry. and are a form of reward for being loyal to the employer. (c) whether the covenant is injurious to the public welfare. G. February 28. those contracts whose cause. and (e) whether the restraint is reasonable from the standpoint of public policy. Public policy does not intend that another than the producer shall reap the fruits of labor. rehired Tiu as Senior Assistant Vice-President and Territorial Operations Head in charge of its Hongkong and Asean operations. or in undue or unreasonable restraint of trade. Platinum Inc. among others. Estoppel cannot give validity to an act that is prohibited by law or one that is against public policy. it being the general rule that pension or retirement plans formulated by the employer are to be construed against it. petitioner is not proscribed. Thus. the trial court should consider the following factors: (a) whether the covenant protects a legitimate business interest of the employer. Jefferson M. at the same time.28 from respondent. Platinum Plans sued Tiu for damages before the RTC of Pasig City. Marquez On the other hand. unenforceable for being repugnant to public policy. However. Tiu v. On September 16. Respondent. Courts should carefully scrutinize all contracts limiting a man's natural right to follow any trade or profession anywhere he pleases and in any lawful manner.. in light of the constitutional mandate of affording full protection to labor. Inc. 1995. rather. morals. by waiver or estoppel. LABOR RELATIONS Atty. it gives to him who labors the right by every legitimate means to protect the fruits of his labor and secure the enjoyment of them to himself. in determining whether the contract is reasonable or not. be denied. as employer. (b) whether the covenant creates an undue burden on the employee. a corporation engaged also in the pre-need industry. 9. must be liberally construed in favor of the employee. Platinum Plans. releasing him from the burden of worrying for his financial support. In November 1995. petitioner Daisy B.

and place. engaged in the same business or belonging to the same pre-need industry as the EMPLOYER.000. trade. association or entity.13 Page 101 . and law. Jefferson M. Court of Appeals and trial court ruled against Tiu. Since petitioner was the Senior Assistant Vice-President and Territorial Operations Head in charge of respondent’s Hongkong and Asean operations. for the next TWO (2) years thereafter. she had been privy to confidential and highly sensitive marketing strategies of respondent’s business. It reasoned that petitioner entered into the contract on her own will and volition. since it only prohibits petitioner from engaging in any pre-need business akin to respondent’s. the restraint imposed was much greater than what was necessary to afford respondent a fair and reasonable protection. whether directly or indirectly. The appellate court also ruled that the stipulation prohibiting non-employment for two years was valid and enforceable considering the nature of respondent’s business. she bound herself to fulfill not only what was expressly stipulated in the contract. violated the non-involvement clause in her contract of employment: The EMPLOYEE further undertakes that during his/her engagement with EMPLOYER and in case of separation from the Company. Petitioner contended that the transfer to a rival company was an accepted practice in the pre-need industry. engage in or be involved with any corporation. Thus. Tiu countered that the non-involvement clause was unenforceable for being against public order or public policy: First.00) for and as liquidated damages. Ruling: The petition is DENIED for lack of merit. usage. he/she shall not. in this case. a non- involvement clause is not necessarily void for being in restraint of trade as long as there are reasonable limitations as to time. but also all its consequences that were not against good faith. whether voluntary or for cause. the non-involvement clause has a time limit: two years from the time petitioner’s employment with respondent ends. To allow her to engage in a rival business soon after she leaves would make respondent’s trade secrets vulnerable especially in a highly competitive marketing environment. In sum. Nevertheless. Supreme Court held that said that such clause was unreasonable restraint of trade and therefore against public policy. LABOR RELATIONS Atty. Inc. we find the non-involvement clause not contrary to public welfare and not greater than is necessary to afford a fair and reasonable protection to respondent. Any breach of the foregoing provision shall render the EMPLOYEE liable to the EMPLOYER in the amount of One Hundred Thousand Pesos (P100. Marquez petitioner’s employment with Professional Pension Plans. It is also limited as to trade. Issue: WON the non-involvement clause is valid. However.

On 1 October 1996. which petitioner and respondent freely agreed upon. for to do so would be to alter the real intent of the parties. the Administrative Investigating Committee found the Department Order appropriate since it was intended to prevent the controversy between petitioner and the complaining student from adversely affecting a harmonious relationship within the College of Law among all its constituents. provided they are not contrary to law. 164893. a certain law student filed a complaint against petitioner for alleged irregularities in the performance of her work. morals. Leonardo S. G. respondent’s Vice President for Administration. Dean Honorato V. Marquez In any event. Jefferson M. since it appears that even from the start. Duldulao vs. On 21 January 1997. and thus. Duldulao informing her of her transfer to the Office of the Principals of the High School and Elementary Departments. insensibility. dela Cruz. the non-involvement clause. or disdain by an employer Page 102 . of petitioner’s failure to file her answer and recommended the assignment of petitioner outside the College of Law. public order or public policy. Petitioner was told to submit her answer to the complaint and given several extensions within which to do so. 2007 Facts: Petitioner Constancia P. good customs. morals. as held by the trial court and the Court of Appeals. should be complied with in good faith. Edilberto B. good customs. Courts cannot stipulate for the parties nor amend their agreement where the same does not contravene law. not only because of such failure to answer but also her having admitted fraternizing with students of the College. Thus. Article 1306 of the Civil Code provides that parties to a contract may establish such stipulations. Tenefrancia.R. On the same day. LABOR RELATIONS Atty. March 1. The NLRC dismissed the complaint for lack of merit which decision was affirmed by the Court of Appeals. has the force of law between them. she failed to submit her answer. petitioner is bound to pay respondent P100. petitioner had not shown the least intention to fulfill the non-involvement clause in good faith. and would run contrary to the function of the courts to give force and effect thereto. or public policy.000 as liquidated damages. issued a Department Order to Mrs. petitioner filed a complaint for constructive dismissal with prayer for moral and exemplary damages and attorney’s fees before the NLRC Regional Arbitration Branch-Cordillera Administrative Region. On 17 February 1997. There is constructive dismissal if an act of clear discrimination. Ruling: There was no constructive dismissal. While we have equitably reduced liquidated damages in certain cases. Court of Appeals. Article 115914 of the same Code also provides that obligations arising from contracts have the force of law between the contracting parties and should be complied with in good faith. She stated that aside from being tainted with procedural lapses in violation of her right to due process. 10. terms and conditions as they may deem convenient. clauses. the transfer also amounted to her demotion in rank. Despite the extensions.15 Not being contrary to public policy. Issue: Whether petitioner’s transfer as secretary/clerk-typist from the College of Law to the High School and Elementary Departments amounts to constructive dismissal. Duldulao was hired by respondent Baguio Colleges Foundation (BCF) as secretary/clerk-typist and assigned to the College of Law sometime in June of 1987. In August 1996. public order. Atty. Aquino of the College of Law informed respondent’s President. No. we cannot do so in this case.

Article 22 of the Civil Code applies. nor inconvenient. or technical competence so that he could efficiently discharge the position of A-300 First Officer. as a Boeing 747 Systems Engineer. It exists where there is cessation of work because "continued employment is rendered impossible. As such secretary/clerk-typist. she would only have to perform the same duties in the Office of the Principals of the High School and Elementary Departments. Since said higher position required additional training. The expectation of PAL was not fully realized. Given that. and competence." The factual milieu in this case is different. (PAL). as an offer involving a demotion in rank and a diminution in pay. He successfully bid for the higher position of Airbus 300 (A-300) First Officer. was hired by respondent. refuse to reimburse the costs of training without violating the principle of unjust enrichment. Page 103 . PAL invested for the training of Almario to enable him to acquire a higher level of skill. at PAL’s expense. but after eight months of service. G. September 11. The purpose of reassignments is no different from that of preventive suspension which management could validly impose as a measure of protection of the company’s property pending investigation of any malfeasance or misfeasance committed by the employee. but rather a preventive measure to avoid further damage to the College of Law. Almario v. He cannot. contrary to Almario’s claim. while incidental to the pending charges against petitioner. Issue: WON Almario should reimburse the training cost. No. the employee may not complain that it amounts to a constructive dismissal. for “personal reasons. therefore. benefits. It is the employer’s prerogative. he underwent. Australia. Inc. After completing the training course.” PAL sent Almario a letter informing that his proposed resignation will make him reimburse the training costs plus damages as he is required to render 3 years of service because the company invested heavily on his professional training. 11. 170928. Reassignments made by management pending investigation of irregularities allegedly committed by an employee fall within the ambit of management prerogative. was not meant to be a penalty. Almario served as A-300 First Officer of PAL. nor prejudicial to him. An employee’s right to security of tenure does not give him such a vested right in his position as would deprive the company of its prerogative to change his assignment or transfer him where he will be most useful.R. The transfer. and it does not involve a demotion in rank or a diminution of his salaries. Marquez becomes so unbearable on the part of the employee that it would foreclose any choice by him except to forego his continued employment. LABOR RELATIONS Atty. aptitudes. The transfer of petitioner does not amount to a demotion in rank and status. Philippine Airlines. however. Almario denied the existence of any agreement with PAL and pointed out that the CBA between PAL and Airline’s Pilot Association carried no such agreement. Almario (Almario). unreasonable or unlikely. hence this petition. RTC rendered judgment in favor of Almario and CA reversed the decision. Ruling: Yes. 2007 Facts: Vicente S. to move them around in the various areas of its business operations in order to ascertain where they will function with maximum benefit to the company. more than five months of training consisting of ground schooling in Manila and flight simulation in Melbourne. he tendered his resignation. Philippine Airlines. and other privileges. When his transfer is not unreasonable. Petitioner was not denied due process. proficiency. Jefferson M. based on its assessment and perception of its employees’ qualifications. due to Almario’s resignation after only eight months of service following the completion of his training course. Petitioner was a secretary/clerk-typist of the College of Law. PAL expected to recover the training costs by availing of Almario’s services for at least three years. The pertinent provision of the CBA and its rationale aside.

In a letter. the transfer of responsibility of the Oro Verde Warehouse to the newly-organized VisMin Logistics Operations effecting the formal transfer of responsibility of the security personnel and equipment in the Oro Verde Warehouse. NLRC: Set aside the Labor Arbiter's Decision. 12. Pontillas (respondent) as a daily wage company guard. In 1984 respondent became a monthly-paid employee which entitled him to yearly increases in salary. issued a Memorandum ordering. termination pay. and attorney's fees. Labor Arbiter ruled that respondent was accorded due process before his termination from the service. and he was able to confront petitioner's witnesses and present evidence in his favor. moral and exemplary damages. LABOR RELATIONS Atty. Pontillas. as well as for recovery of salary differential and backwages. respondent filed an amended complaint against petitioner for illegal dismissal and payment of backwages. Marquez Art. Simultaneously. San Miguel Corporation (petitioner) employed Angel C. The Labor Arbiter recognized the management prerogative to transfer its employees from one station to another.R. The NLRC declared that petitioner failed to justify why respondent was not entitled to the full rate of salary increases enjoyed by other security guards. Every person who through an act of performance by another. No. petitioner informed respondent that an administrative investigation would be conducted on relative to his alleged offenses of Insubordination or Wilful Disobedience in Carrying out Reasonable Instructions of his superior. . Jefferson M. San Miguel Corp. the manager gave the same information to his Supervising Security Guards for them to relay the information to the company security guards. 155178. NLRC further ruled that respondent was a victim of discrimination. G. 22. respondent filed an action for recovery of damages due to discrimination under Article 100 4 of the Labor Code. shall return the same to him. Respondent alleged that his yearly salary increases were only a percentage of what the other security guards received. He alleged that he was not properly notified of the transfer and that he did not receive any written order Petitioner alleged that respondent was properly notified of the transfer but he refused to receive Petitioner also alleged that respondent was given notices of Guard Detail separately dated. The notices allegedly sent to respondent did not indicate any receipt from respondent. against petitioner. LA: Ruled in favour of the company and against Pontillas. He was investigated with the assistance of counsel. unjust. The NLRC ruled that respondent was not informed of his transfer from Oro Verde Warehouse to VisMin Logistics Operations. or unreasonable to petitioner's decision to merge the functions of the Materials Management of the Mandaue Brewery and the Physical Distribution Group which resulted to the forming of the VisMin Logistics Operations. The Labor Arbiter further ruled that petitioner did not violate Article 100 of the Labor Code. but he still refused to report for duty at the VisMin Logistics Operations. Page 104 . or any other means. v. among others. Petitioner alleged that respondent was properly notified of the transfer but he refused to receive Respondent continued to report at Oro Verde Warehouse. May 07. Manager. The Labor Arbiter found nothing prejudicial. acquires or comes into possession of something at the expense of the latter without just or legal ground. 2008 Facts: On 24 October 1980. On 19 October 1993.

In this case. Employer exercises the prerogative to transfer an employee for valid reasons and according to the requirements of its business.m.m. The MOA specifically stated that the employee waives the right to claim overtime pay for work rendered after 5:00 p. that is. Tryco received the Letter dated March 26. The MOA was entered into pursuant to Department of Labor and Employment Department Order (D. provided the transfer does not result in demotion in rank or diminution of the employee's salary.m. BMT and Tryco negotiated for the renewal of their collective bargaining agreement (CBA) but failed to arrive at a new agreement. and must pertain to the duties which he had been engaged to discharge.. characterized by a wrongful and perverse attitude. 151309. BMT declared a strike on May 26. G.O. an employer may terminate an employment for serious misconduct or willful disobedience by the employee of the lawful orders of his employer or his representative in connection with his work. However. 1997 from the Bureau of Animal Industry of the Department of Agriculture reminding it that its production should be conducted in San Rafael. and (2) the order violated must have been reasonable. Bisig Manggagawa sa Tryco vs. Respondent was properly informed of the transfer but he refused to receive the notices on the pretext that he was wary because of his pending case against petitioner. lawful. In protest. from Monday to Friday. Bulacan. Petitioners then filed their complaints to the labor arbiter alleging that Tryco negotiated in bad faith and unfair labor practice of Tryco by transferring the members of the union in order to paralyze it and that therefore it amounted to constructive dismissal.. The Court of Appeals ruled that there was no sufficient evidence that would show that respondent's failure to report to his new superior was willful and characterized by a perverse and wrongful attitude. 1997. 1996. In January 1997. NLRC. Series of 1990. 13. Bulacan.) No. Guidelines on the Implementation of Compressed Workweek. No. BMT opposed the transfer of its members to San Rafael. 8:00 a. Tryco informed the Bureau of Working Conditions of the Department of Labor and Employment of the implementation of a compressed workweek in the company. Tryco issued a Memorandum dated April 7. REINSTATE Decision of the Labor Arbiter. as amended. 2008 Facts: Petitioners are employees of Tryco Pharmaceuticals Corporation. not in Caloocan City since its operating permit was licensed there. Wilful disobedience requires the concurrence of two elements: (1) the employee's assailed conduct must have been wilful. should an employee be permitted or required to work beyond 6:12 p. benefits. LABOR RELATIONS Atty. and other privileges. Tryco and the petitioners signed a Memorandum of Agreement (MOA). made known to the employee. shall be considered as the regular working hours. maker of veterinary medicines and products. 21. to 6:12 p. until 6:12 p. such employee shall be entitled to overtime pay. 15. Issue: Legality of respondent's dismissal from employment. Meantime. providing for a compressed workweek schedule to be implemented in the company effective May 20. we found that the order of transfer was reasonable and lawful considering the integration of Oro Verde Warehouse with VisMin Logistics Operations. An employer may terminate an employment for serious misconduct or wilful disobedience by the employee of the lawful orders of his employer or representative in connection with his work. from Monday to Friday considering that the compressed workweek schedule is adopted in lieu of the regular workweek schedule which also consists of 46 hours. Court of Appeals ruled that under Article 282(a) of the Labor Code. 1997 which directed petitioners to report to the company's plant site in Bulacan. and no overtime pay shall be due and payable to the employee for work rendered during those hours. contending that it constitutes unfair labor practice. Page 105 . Accordingly. Oct. Marquez CA: Court of Appeals affirmed with modification the NLRC's Decision. Ruling: Respondent was dismissed for a just cause.m.m. As provided in the MOA.R. Jefferson M.

regardless of whether it was made pursuant to the letter of the Bureau of Animal Industry. Findings of fact of labor officials. privileges and other benefits. or prejudicial to the employee. inconvenient. While the law is solicitous of the welfare of employees. therefore. Indisputably. Jefferson M. Marquez Issue: Was there constructive dismissal due to the transfer of the petitioners from Caloocan City to San Rafael Bulacan? Ruling: The petition has no merit. according to its own discretion and judgment. benefits. and bind us when supported by substantial evidence. the employer has the burden of proving that the transfer of an employee is for valid and legitimate grounds. Bulacan. This prerogative extends to the management's right to regulate. Thus. generally not constitutive of constructive dismissal. benefits and other privileges of the petitioners. who are deemed to have acquired expertise in matters within their respective jurisdiction. Page 106 . assigned to the Production Department was well within the scope of its management prerogative. Petitioners. all aspects of employment. Tryco's decision to transfer its production activities to San Rafael. anchor their objection solely on the ground that it would cause them great inconvenience since they are all residents of Metro Manila and they would incur additional expenses to travel daily from Manila to Bulacan. therefore.This is particularly true when the findings of the Labor Arbiter. The free will of management to conduct its own business affairs to achieve its purpose cannot be denied. However. or prejudicial to the employee. and other privileges. The employer must show that the transfer is not unreasonable. it must also protect the right of an employer to exercise what are clearly management prerogatives. In this case. and the CA uniformly agreed that the petitioners were not constructively dismissed. the transfer orders do not entail a demotion in rank or diminution of salaries. Objection to a transfer that is grounded solely upon the personal inconvenience or hardship that will be caused to the employee by reason of the transfer is not a valid reason to disobey an order of transfer. are generally accorded not only respect but even finality. LABOR RELATIONS Atty. When the transfer is not unreasonable. The Court has previously declared that mere incidental inconvenience is not sufficient to warrant a claim of constructive dismissal. or inconvenient. was within the scope of its inherent right to control and manage its enterprise effectively. in the instant case. and it does not involve a demotion in rank or diminution of salaries. the NLRC and the CA are in absolute agreement. the consequent transfer of Tryco's personnel. nor does it involve a demotion in rank or a diminution of his salaries. Hence petition was denied for lack of merit. the NLRC. including the freedom to transfer and reassign employees according to the requirements of its business. the employee may not complain that it amounts to a constructive dismissal. the Labor Arbiter.Management's prerogative of transferring and reassigning employees from one area of operation to another in order to meet the requirements of the business is.

in good faith the Company has initiated a special program called "Project New Start". Marquez 14. despite due notice. informing him that (1) he was designated as Staff Assistant to the Corporate Purchasing and Materials Control Manager. Pineda then served as the Executive Assistant in the Business Logistic Directorate in charge of the Refrigeration Services of the Company. Del Villar continued to receive the same salary as Transportation Services Manager. under the Business Logistic Directorate. LABOR RELATIONS Atty. as part of the conspiracy. According to Coca-Cola [Del Villar] was not outrightly dismissed. As a result. the functions related to Refrigeration were assigned to the Transportation Services Manager. detailing an alleged fraudulent scheme undertaken by certain Company officials in conspiracy with local truck manufacturers. This program is intended to assist employees whose positions will be declared redundant with the implementation of new distribution systems. from his former position as Transportation Services Manager. Although as the Staff Assistant of the Corporate Purchasing and Materials Control Manager. No. gasoline allowance. Jefferson M.000. headed by Director Edgardo I. which was renamed the Transportation and Refrigeration Services Manager. del Villar (Del Villar) on May 1. Unable to endure any further the harassment. Del Villar filed with the Arbitration Branch of the NLRC on November 11.R. 163091. Pineda. The Company reasoned that in appointing Del Villar as the Staff Assistant of the Corporate Purchasing and Materials Control Manager. Del Villar submitted a Report to the Company President. G. The Labor Arbiter held that the allegations in Del Villars complaint sufficiently presented a Page 107 . utilization of improved operational processes and functional re-organizations. The Company failed to appear. Del Villar prepares the budget for the vehicles of the Company nationwide. he ceased to be entitled to the benefits accruing to an S-7 position under existing company rules and policies." Del Villar believed that he was demoted by the Company to force him to resign.000. as part of the reorganization of the Company. aside from the use of a company car. Del Villar received a Memorandum from San Juan. among other Company officials. They contended that Del Villar had no vested right to the privileges he previously enjoyed as Transportation Services Manager. 1990 as Physical Distribution Fleet Manager with a job grade of S-7 and monthly salary of P50. San Juan (San Juan). he was removed from his former position as Transportation Services Manager. 1996. Coca-Cola Bottler’s Philippines. among other benefits.00 each.. the Company was merely exercising its inherent management prerogative to transfer an employee from one position to another. and demoted to Staff Assistant to the Corporate Purchasing and Materials Control Manager. Del Villar. instead. Del Villar implicated San Juan and Jose L.00. and annual foreign travel. In 1992. October 6. Since the various programs will affect some of its employees. As Transportation Services Manager. Labor Arbiter rendered a Decision in Del Villars favor. Del Villar became the Transportation Services Manager. 1996 a complaint against the Company for illegal demotion and forfeiture of company privileges. The Company embarked on a reorganization of the Business Logistic Directorate. overpricing the trucks purchased by the Company by as much as P70. v. 2010 Facts: Coca-Cola hired respondent Angel U. with a job grade of NS-VII. Inc. but his car and other privileges were withdrawn and he spent his time at his new post sitting "at a desk with no meaningful work whatsoever. and (3) Del Villar was to turn over the vehicle assigned to him as Transportation Services Manager to Pineda by July 10. at the scheduled preliminary conference before the NLRC Arbitration Branch. (2) with Del Villars new assignment. Seven months after the submission of his Report on the fraudulent scheme of several company officials. Jr.

there are limits thereto. As it is. NLRC reversed the Labor Arbiter. Accordingly. A company cannot.virtuallawlibrary Managerial prerogatives. Issue: Whether or not Company. This is amply supported by the fact that the [the Company] conducted a thorough investigation of the reported scam and even obtained the services of an independent auditor to determine whether the alleged anomalous transactions were actually irregular and/or questionable. privileges and perquisites that attach to a certain position do not provide sufficient bases for determining the superiority or inferiority of the position so held. This manifests that [Del Villars] disclosure was taken seriously contrary to his claims of discrimination. in transferring Del Villar from the position of Transportation Services Manager to Staff Assistant to the Corporate Purchasing and Materials Control Manager. [the Company] would not have given grave attention to the disclosure of [Del Villar]. however. management has the prerogative to transfer or assign employees from one office or area of operation to another provided there is no demotion in rank or diminution of salary. The right of employees to security of tenure does not give them vested rights to their positions to the extent of depriving management of its prerogative to change their assignments or to transfer them. validly exercised its management prerogative or committed constructive dismissal. and general principles of fair play and justice. we do not even see any disclosure of the scam and his alleged demotion. and other privileges. are subject to limitations provided by law. Benefits. it cannot be said that the act of the [Company] was retaliatory or penal in nature nor tainted with bad faith and/or malice. Otherwise. made in bad faith. reasoning that:virtualaw Contrary to the Labor Arbiters pronouncement that [the Company] should have rebutted allegations of bad faith and malice. Del Villar appears to have been singled out or discriminated upon due to his having reported the 1996 truck scam. Otherwise. Mere conclusions of fact and law should not be used as bases for an automatic finding of bad faith. or demotion? Whether or not there has been redundancy in the position held by Del Villar that justified the company from the act of taking the position from him? Ruling: In the pursuit of its legitimate business interest. like other rights. collective bargaining agreements. Jefferson M. The managerial prerogative to transfer personnel must be exercised without grave Page 108 . the logical consequence of such disclosure is for the president of the company to dismiss the erring employees and officers for their highly irregular acts and not to penalize [Del Villar] for making such disclosure. If indeed the so-called "great grandmother of Coca cola scams of 1996" were true. be reasonably expected to provide the same benefits to an employee whose position for example. as a "Staff Assistant" [Del Villar] should have been given some meaningful or responsible work appurtenant to the job designation. LABOR RELATIONS Atty. or effected as a form of punishment or demotion without sufficient cause. we are more inclined to apply the presumption of good faith. benefits. Marquez cause of action against the Company. requires that he stays in the office during working hours. But. however. and his present isolation can be seen as a punishment for acting in a righteous and forthright manner. and the action is not motivated by discrimination.

Likewise. with a corresponding decrease in duties and responsibilities. Page 109 . particularly. Del Villar could no longer enjoy the use of a company car. Should the employer fail to overcome this burden of proof. without break in service. is the advancement from one position to another with an increase in duties and responsibilities as authorized by law. there was a diminution in his benefits. the employees transfer shall be tantamount to constructive dismissal. he was evidently demoted. while Del Villars transfer did not result in the reduction of his salary. constructive dismissal exists when an act of clear discrimination. Del Villar contended that he was not assigned any meaningful work at all. Formerly. then he was made a Staff Assistant a subordinate to another manager. on the other hand. he was the Transportation Services Manager. and annual foreign travel. unreasonable or unlikely. Marquez abuse of discretion. The Company and its officials attempt to justify the transfer of Del Villar by alleging his unsatisfactory performance as Transportation Services Manager. Conversely. he being in charge of preparing the budget for all of the vehicles of the Company nationwide. we give weight to the following instances establishing that Del Villar was not merely transferred from the position of Transportation Services Manager to the position of Staff Assistant to the Corporate Purchasing and Materials Control Manager. Second. He merited a mediocre grade of 2 in a scale of one (1) to five (5). Thus. nor does it involve a demotion in rank or a diminution of his salaries. 1996 in an alleged fraudulent scheme against the Company. as an offer involving a demotion in rank and diminution in pay. He was unable to submit basic data as to type and brand of vehicles with highest/lowest maintenance cost as requested. He could not work with minimum or no supervision. which has been defined as a quitting because continued employment is rendered impossible. [Del Villar] lacked initiative and had to be constantly reminded of what to do. demotion involves a situation where an employee is relegated to a subordinate or less important position constituting a reduction to a lower grade or rank. Del Villars demotion is readily apparent in his new designation. level or salary. the two posts are not of the same weight in terms of duties and responsibilities. LABOR RELATIONS Atty. Third. Promotion. His activities needed to be closely and constantly monitored by his superiors. the Corporate Purchasing and Materials Control Manager. which Del Villar previously enjoyed as Transportation Services Manager. privileges and other benefits. gasoline allowance. it cannot be used as a subterfuge by the employer to rid himself of an undesirable worker. Having the right should not be confused with the manner in which that right is exercised. The dismal performance evaluations of Del Villar were prepared by San Juan and Pineda after Del Villar already implicated his two superiors in his Report dated January 4.uallawlibrary After a careful scrutiny of the records. insensibility or disdain by an employer has become so unbearable to the employee leaving him with no option but to forego with his continued employment. Del Villars position as Transportation Services Manager involved a high degree of responsibility. The Company disclosed that: [Del Villar] displayed an utterly woeful performance. Jefferson M. and usually accompanied by an increase in salary. inconvenient or prejudicial to the employee. The Company admits that as Staff Assistant of the Corporate Purchasing and Materials Control Manager. and usually accompanied by a decrease in salary. More importantly. bearing in mind the basic elements of justice and fair play. the employer must be able to show that the transfer is not unreasonable. the latter number being the highest grade We are unconvinced. As Staff Assistant of the Corporate Purchasing and Materials Control Manager. A transfer is a movement from one position to another which is of equivalent rank. In particular. we agree with the Labor Arbiter and the Court of Appeals that the Company failed to discharge this burden of proof. [Del Villar] could not even update the records of his office.

as his position was no longer necessary or was considered redundant due to the reorganization of the Business Logistic Directorate. such as overhiring of workers. There is constructive dismissal when there is a demotion in rank and/or diminution in pay. the Company actually terminated Del Villars services effective May 31. The situation would be more oppressive for Del Villar because of his subordinate position vis-à-vis Pineda. In case of termination due to the installation of labor-saving devices or redundancy. decreased volume of business. Eventually. Del Villars poor employee performance is irrelevant as regards the issue on redundancy. Succinctly put. In other words. by serving a written notice on the workers and the Department of Labor and Employment at least one (1) month before the intended date thereof. Marquez Fourth. a position is redundant where it is superfluous. it was not bad enough that Del Villar was demoted. and Pineda. and superfluity of a position or positions may be the outcome of a number of factors. the worker affected thereby shall be entitled to a separation pay equivalent to at least his one (1) month pay or to at least one (1) month pay for every year of service. Fifth. The employer may also terminate the employment of any employee due to the installation of labor-saving devices. Closure of establishment and reduction of personnel. The wisdom or soundness of this judgment is not subject to discretionary review of the Labor Arbiter and the NLRC. 1998. had been strained and hostile. A fraction of at least six (6) months shall be considered one (1) whole year. it is not enough for a company to merely declare that it has become overmanned. whichever is higher. It is governed by Article 283 of the Labor Code. redundancy. It is not too difficult to imagine that the working relations between Del Villar. 283. whichever is higher. the separation pay shall be equivalent to one (1) month pay or to at least one-half (1/2) month pay for every year of service. Neither did the Company present proof that it had complied with the procedural requirement in Article 283 of prior notice to the Department of Labor and Employment (DOLE) of the termination of Del Villars employment due to redundancy one month prior to May 31. the accuser. It must produce adequate proof of such redundancy to justify the dismissal of the affected employees. but he was even placed by the Company under the control and supervision of Pineda as the latters Staff Assistant. Redundancy. The Labor Arbiter was correct in his observation that had Del Villar resigned immediately after his "transfer. The determination that the employee's services are no longer necessary or sustainable and. LABOR RELATIONS Atty. 1996. or dropping of a particular product line or service activity previously manufactured or undertaken by the enterprise. however. properly terminable for being redundant is an exercise of business judgment of the employer. Pineda was one of the Company officials who Del Villar accused of defrauding the Company in his Report dated January 4. retrenchment to prevent losses or the closing or cessation of operation of the establishment or undertaking unless the closing is for the purpose of circumventing the provisions of this Title. Coca Cola presented no other evidence . To recall." he could be said to have been constructively dismissed. 1998. Redundancy is one of the authorized causes for the dismissal of an employee. Jefferson M. therefore. or when a clear discrimination. Redundancy arises because there is no more need for the employees position in relation to the whole business organization. which reads: ART. insensibility or disdain by an employer becomes unbearable to the employee. for purposes of the Labor Code. and not because the employee unsatisfactorily performed the duties and Page 110 . the accused. In case of retrenchment to prevent losses and in cases of closures or cessation of operations of establishment or undertaking not due to serious business losses or financial reverses. provided there is no violation of law and no showing that it was prompted by an arbitrary or malicious act. all the foregoing caused Del Villar inconvenience and prejudice. exists where the services of an employee are in excess of what is reasonably demanded by the actual requirements of the enterprise. so unbearable for him that he was constrained to seek remedy from the NLRC.

Sapitula. Also. denouncing respondent. G. and violation of the provisions on job security of their Collective Bargaining Agreement (CBA). vs. Respondent filed a petition for the issuance of a writ of habeas data against petitioners before the Regional Trial Court (RTC) of Bulacan. Lim. at which respondent is assigned. 6715. In awarding separation pay to an illegally dismissed employee. Bulacan Sector. 15. Under Republic Act No. Respondent is essentially questioning the transfer of her place of work by her employer and the terms and conditions of her employment which arise from an employer-employee relationship over which the NLRC and the Labor Arbiters under Article 217 of the Labor Code have jurisdiction. . 184769. Marquez responsibilities required by his position. also known as Cherry Lim. in lieu of reinstatement." effective July 18. the backwages shall be computed from the time of their illegal termination up to the finality of the decision." Respondent. We note that Del Villars reinstatement is no longer possible because the position he previously occupied no longer exists. October 5. employees who are illegally dismissed are entitled to full backwages. claiming that the "punitive" nature of the transfer amounted to a denial of due process. liberty and security. LABOR RELATIONS Atty. NGAYON NAMAN AY GUSTO MONG PALAMON ANG BUONG KUMPANYA SA MGA BUWAYA NG GOBYERNO. An employee who is illegally dismissed is entitled to the twin reliefs of full backwages and reinstatement. Citing the grueling travel from her residence in Pampanga to Alabang and back entails. per San Juans Affidavit dated October 15. separation pay is awarded to the employee. KAPAL NG MUKHA MO. Del Villar had already received his separation pay sometime in October 1998. inclusive of allowances and other benefits or their monetary equivalent. On June 4. inter alia. The letter reads: Cherry Lim: MATAPOS MONG LAMUNIN LAHAT NG BIYAYA NG MERALCO. 2008. Petitioners moved for the dismissal of the petition and recall of the TRO on the grounds that. WALANG UTANG NA LOOB Resource Staffing. computed from the time their actual compensation was withheld from them up to the time of their actual reinstatement but if reinstatement is no longer possible. directed the transfer of respondent to MERALCO's Alabang Sector in Muntinlupa as "A/F OTMS Clerk. by letter of July 10. reports that there were accusations and threats directed against her from unknown individuals and which could possibly compromise her safety and security. Vice-President and Head of MERALCO's Human Resource Administration. appealed her transfer and requested for a dialogue so she could voice her concerns and misgivings on the matter. No. By respondent's allegation. . the amount to be awarded shall be equivalent to one month salary for every year of service. LUMAYAS KA RITO. If reinstatement is not viable. 1998. Manila Electric Co. 2010 Facts: Rosario G. and the RTC lacked jurisdiction over the case which properly belongs to the National Labor Relations Commission Page 111 . correctible by habeas data. 2008 addressed to petitioner Ruben A.R. resort to a petition for writ of habeas data was not in order. is an administrative clerk at the Manila Electric Company (MERALCO). Jefferson M. 2008 in light of the receipt of ". an anonymous letter was posted at the door of the Metering Office of the Administration building of MERALCO Plaridel. Lim (respondent). petitioners' unlawful act and omission consisting of their continued failure and refusal to provide her with details or information about the alleged report which MERALCO purportedly received concerning threats to her safety and security amount to a violation of her right to privacy in life.

After a week. he was assigned at BGC as assistant detachment commander. he was transferred to Pacific Plaza Towers as assistant detachment commander and later as detachment commander. the BSSI hired a new operations manager. 188086. LABOR RELATIONS Atty. Bello was assigned as roving traffic marshal at the BGC. In July 2001. Bello vs. he was assigned at Pier 2. Bonifacio Security Services. Issue: Whether or not. Labor Arbiter Cresencio G. It is evident that respondent's reservations on the real reasons for her transfer — a legitimate concern respecting the terms and conditions of one's employment — are what prompted her to adopt the extraordinary remedy of habeas data. Jurisdiction over such concerns is inarguably lodged by law with the NLRC and the Labor Arbiters. Ruling: Respondent's plea that she be spared from complying with MERALCO's Memorandum directing her reassignment to the Alabang Sector. Ramos. with the National Labor Relations Commission (NLRC). Marquez (NLRC). North Harbor as assistant detachment commander. he filed an indefinite leave of absence when his new assignment took effect. to assistant detachment commander. under the guise of a quest for information or data allegedly in possession of petitioners. Jefferson M. does not fall within the province of a writ of habeas data. to supervise sectoral operations. 2011 Facts: Respondent Bonifacio Security Services. and to detachment commander. In June 2002. Bello abandoned his job when he went on an indefinite leave of absence and did not report for work. resulting in the reorganization of posts. G. RTC has jurisdiction. 2002. but later reassigned to BGC. Bello filed a complaint against the BSSI and its General Manager.R. North Harbor. Page 112 . He alleged that he received a series of promotions from 2001 to 2002. from traffic marshal to supervisor. The BSSI denied Bello's claim of constructive dismissal. noting that the BSSI failed to adduce evidence that Bello abandoned his employment. claiming that he had been constructively dismissed when he was demoted from a detachment commander to a mere traffic marshal. arguing that no promotion took place. 16. Inc. 2002. In August 2002. respondent Samuel Tomas. In October 2002. In November 2001. On October 25. found that Bello was illegally dismissed. the BSSI hired Bello as a roving traffic marshal to manage traffic and to conduct security and safety-related operations in the Bonifacio Global City (BGC). On November 5. Bello was posted at the Negros Navigation Company in Pier 2. (BSSI) is a domestic private corporation engaged in the business of providing security services. Bello's designation as assistant detachment commander or detachment commander was not an employment position but a duty-related assignment. In August 2001. Jr. August 3. No.

January 14. the BSSI merely changed his assignment or transferred him to the post where his service would be most beneficial to its clients. Marquez In its March 26. It noted that Bello offered no evidence to prove that there was a series of promotions that would justify his claim of subsequent demotion. 1997. as when there is a demotion in rank or diminution in pay. 182397. Page 113 .00 pesos a day as regular employees. Issue: Whether or not. or unlikely. 17. Alert Security and Investigation Agency vs. The CA nullified the NLRC resolutions. they were relieved from their posts in the DOST and were not given new assignments despite the lapse of six months. As a result of their complaint. 1999. Inc. they filed a joint complaint for illegal dismissal against petitioners. insensibility. finding that Bello had been constructively dismissed when he was demoted to the rank-and-file position of traffic marshal after occupying the supervisory position of assistant detachment commander and detachment commander. They were paid 165. paving the way for the present petition. 1997. 2008 resolution. On January 26. Respondents aver that because they were underpaid. Other than his bare and self-serving allegations. and assigned at the Department of Science and Technology (DOST) pursuant to a security service contract between the DOST and Alert Security. (Alert Security) as security guards beginning March 31.R. The management's prerogative of transferring and reassigning employees from one area of operation to another in order to meet the requirements of the business is generally not constitutive of constructive dismissal. The CA denied the BSSI's motion for reconsideration. Case law defines constructive dismissal as a cessation of work because continued employment has been rendered impossible. and three months later to assistant detachment commander and to detachment commander in November 2001. Wilfredo Verceles and Melchor Bulusan were all employed by petitioner Alert Security and Investigation Agency. unreasonable. finding the records bereft of evidence substantiating the labor arbiter's and the NLRC's conclusions that Bello had been constructively dismissed. respectively. Santos. Dasig. they filed a complaint for money claims against Alert Security and its president and general manager. or when a clear discrimination. before Labor Arbiter Ariel C. or both. No. 1996. from a traffic marshal in July 2001 to supervisor in August 2001. and January 24. Ruling: We find no reason to disturb the CA conclusion that there was no constructive dismissal. Pasawilan. At most. September 14. G. petitioner Manuel D. We see this to be the case in the present dispute so that the consequent reassignment of Bello to a traffic marshal post was well within the scope of the BSSI's management prerogative. or disdain by an employer becomes unbearable to the employee. it is highly improbable that Bello would be promoted after just a month of employment. Bello was illegally dismissed. During his six-month probationary period of employment. the NLRC affirmed the labor arbiter's decision. Jefferson M. Bello has not offered any evidence that he was promoted in a span of four months since his employment as traffic marshal in July 2001 to a detachment commander in November 2001. LABOR RELATIONS Atty. 2011 Facts: Respondents Saidali Pasawilan.

Article 13 guarantees security of tenure for workers and because of this. employers are barred from arbitrarily removing their workers whenever and however they want. on August 3. We acknowledge and recognize the right of an employer to transfer employees in the interest of the service. deny that they dismissed the respondents. x x x Page 114 . Alert Security filed a "termination report" with the Department of Labor and Employment relative to the termination of the respondents. An employee asserting his right and asking for minimum wage is not among those causes. however. Jefferson M. Otherwise. they served no purpose unless the intended recipients of the orders are informed of such. an employee may only be terminated for just or authorized causes that must comply with the due process requirements mandated by law. 1998. Although we recognize the right of employers to shape their own work force. Hence. LABOR RELATIONS Atty. However. On the element of the failure of the employee to report for work. bearing in mind the basic elements of justice and fair play. it cannot be used as a subterfuge by the employer to rid himself of an undesirable worker. Such stroke of retribution has no place in Philippine Labor Laws. the failure of an employee to report for work at the new location cannot be taken against him as an element of abandonment. Granting that the "Duty Detail Orders" were indeed issued. as amended. As a rule. this management prerogative must not curtail the basic right of employees to security of tenure. we also cannot accept the allegations of petitioners that respondents unjustifiably refused to report for duty in their new posts. employment cannot be terminated by an employer without any just or authorized cause. Having the right should not be confused with the manner in which that right is exercised. enumerates several just and authorized causes for a valid termination of employment. Thus. failed to report at the LRTA and instead kept loitering at the DOST and tried to convince other security guards to file complaints against Alert Security. In particular. Issue: Whether respondents were illegally dismissed Rulings: We rule in the affirmative. A careful review of the records reveals that there is no showing that respondents were notified of their new assignments. The Labor Code. there are limitations to the right to transfer employees. Hence. The employer cannot simply conclude that an employee is ipso facto notified of a transfer when there is no evidence to indicate that the employee had knowledge of the transfer order. like all rights. No less than the 1987 Constitution in Section 3. As ruled in the case of Blue Dairy Corporation v. Petitioners presented "Duty Detail Orders" that Alert Security issued to show that respondents were in fact assigned to LRTA. the employer must be able to show that the transfer is not unreasonable. There must be a valid and lawful reason for terminating the employment of a worker. Marquez Petitioners. privileges and other benefits. The law sets the valid grounds for termination as well as the proper procedure to take when terminating the services of an employee. nor does it involve a demotion in rank or a diminution of his salaries. Respondents. Dismissing an employee on this ground amounts to retaliation by management for an employee’s legitimate grievance without due process. on the other hand. inconvenient or prejudicial to the employee. it is illegal and would be dealt with by the courts accordingly. NLRC: x x x The managerial prerogative to transfer personnel must be exercised without grave abuse of discretion. Thus. This exercise is a management prerogative which is a lawful right of an employer.

Pursuant to a supervisory personnel reorganization program. He refused to follow the transfer order and instead filed a Complaint before the Labor Arbiter for constructive dismissal. While the case was pending. pursuant to their Collective Bargaining Agreement (CBA). we rule in this case that MPH did not lose its authority to discipline respondent for his continued refusal to report to his new assignment. Manila Pavilion Hotel vs. a fine-dining restaurant operated by petitioner. MPH replied and told respondent to report to his new assignment for the time being. January 25. Jefferson M. Marquez In addition to these tests for a valid transfer. 189947. we recall our Decision in Allied Banking Corporation v. requiring him to explain in writing why he should not be penalized for the following offenses: serious misconduct. Verily. When he continued to refuse. G. He was originally assigned as Head Waiter of Rotisserie. Petitioners’ insistence on the sufficiency of mere issuance of the transfer order is indicative of bad faith on their part. Despite the notices from MPH. Delada. employer Allied Bank reassigned respondent Galanida from its Cebu City branch to its Bacolod and Tagbilaran branches. No. on 9 May 2007. Court of Appeals. gross and habitual neglect of duties. his transfer must be held in abeyance. since the grievance machinery under their CBA had already been initiated. According to him. there should be proper and effective notice to the employee concerned. we ruled thus: Page 115 . an employer cannot reasonably expect an employee to report for work in a new location without first informing said employee of the transfer. Allied Bank eventually terminated his services. He also requested his retention as Head Waiter of Rotisserie while the grievance procedure was ongoing. Rulings: Accordingly. Delada persistently rebuffed orders for him to report to his new assignment. MPH initiated administrative proceedings against him. Issue: Whether MPH retained the authority to continue with the administrative case against Delada for insubordination and willful disobedience of the transfer order. MPH sent him several memoranda on various dates. Due to his continued refusal to report to his new assignment. 2012 Facts: Delada was the Union President of the Manila Pavilion Supervisors Association at MPH. gross insubordination. Thus. When the issue of whether he could validly refuse to obey the transfer orders was brought before this Court. Thus. and willful breach of trust.R. It is the employer’s burden to show that the employee was duly notified of the transfer. another restaurant operated by petitioner at the same hotel. In Allied Banking Corporation. Respondent declined the inter-outlet transfer and instead asked for a grievance meeting on the matter. MPH reassigned him as Head Waiter of Seasons Coffee Shop. 18. without prejudice to the resolution of the grievance involving the transfer. In relation to this point. Allied Bank insisted that he report to his new assignment. willful disobedience of the lawful orders of the employer. it directed him to explain in writing why no disciplinary action should be meted out to him. LABOR RELATIONS Atty. He adamantly refused to assume his new post at the Seasons Coffee Shop and instead continued to report to his previous assignment at Rotisserie.

MPH had the authority to continue with the administrative proceedings for insubordination and willful disobedience against Delada and to impose on him the penalty of suspension. While it is true that Delada’s transfer to Seasons is the subject of the grievance machinery in accordance with the provisions of their CBA. citations omitted). This issue falls squarely in the case of Allied Banking Corporation vs. Jefferson M. negotiate and seek redress against employers for rules or orders that they regard as unjust or illegal. petitioner is not liable to pay back wages and other benefits for the period corresponding to the penalty of 90-day suspension. LABOR RELATIONS Atty. there is a presumption of the validity of that order. Since the PVA eventually ruled that the transfer order was a valid exercise of management prerogative. For Galanida’s continued refusal to obey Allied Bank's transfer orders. Employees may object to. As a consequence. unless the order of MPH is rendered invalid. until and unless these rules or orders are declared illegal or improper by competent authority. It is important to note what the PVA said on Delada’s defiance of the transfer order: In fact. Galanida is thus not entitled to reinstatement or to separation pay. Page 116 . Delada is expected to comply first with the said lawful directive while awaiting the results of the decision in the grievance proceedings. However. we hereby reverse the Decision and the Resolution of the CA affirming the Decision of the PVA in this respect. the employees ignore or disobey them at their peril. (Emphasis supplied. Pursuant to Allied Banking. Court of Appeals x x x. Marquez The refusal to obey a valid transfer order constitutes willful disobedience of a lawful order of an employer. we hold that the bank dismissed Galanida for just cause in accordance with Article 282(a) of the Labor Code. Delada cannot hide under the legal cloak of the grievance machinery of the CBA or the voluntary arbitration proceedings to disobey a valid order of transfer from the management of the hotel.

The fact that they worked Page 117 . were workers who have rendered services in various corporations of private respondents. Davao City. their employers must pay them full back wages. This rule has been uniformly applied in subsequent cases. Inc. petitioners were dismissed because of a "change of management. petitioners filed with the NLRC. No.R. a complaint for illegal dismissal. Jefferson M. On August 3. non-payment of wages. or on July 26. Petitioners found themselves in the middle of the crossfire and were told to temporarily stop working. 148848. the CA was correct in upholding the labor arbiter's finding that they had been illegally dismissed. rendering the same services. Insular Builders. father.. 1993 without prior notice and also in absence of any valid cause. Petitioners." They were not given any prior written notice. and Queen City Builders. is a family-owned corporation managed and operated principally by Antonio Murillo. citing Bustamante Facts: Private respondent. Sta. managed and controlled by private respondent Rodolfo Murillo. at the height of the feud between private respondents Antonio Murillo and Rodolfo Murillo. but simply told that their services were terminated on the day they stopped working for Insular Builders. Inc. namely Mindanao Integrated Builders. Having been illegally dismissed. 1993. Inc. and retirement pay as regards petitioner Abdon Dayson.. Rodolfo Murillo. 1993. private respondent Antonio Murillo dismissed petitioners and reported the matter to the Department of Labor and Employment (DOLE). Inc. While litigating. and assumed control of the company. Retuya v. Inc. Inc. Under the circumstances. as penalty for their illegal dismissal. NLRC. on the other hand. Inc. It is engaged in the construction business. the Queen City Builders. locality and at the same office but under a different company. NLRC held that illegally dismissed employees were entitled to full back wages that should not be diminished or reduced by the amount they had earned from another employment during the period of their illegal dismissal. Clara Plywood. Insular Builders. Regional Arbitration Branch No. Petitioners averred that they were terminated from employment on July 26. G. They alleged that their termination was an off-shoot of the supposed personal rift and disagreements between private respondents Antonio Murillo and Rodolfo Murillo. Petitioners were however made to continue their work. Issue: Whether petitioners are entitled to full back wages and separation pay in accordance with Article 279 of the Labor Code HELD Bustamante v. the former discharged the latter from his position as manager of Insular Builders. in the same place. 2003. Early 1993... employees must still earn a living. and his son. NLRC. petitioners should be awarded back wages in accordance with Bustamante v. Marquez TERMINATION OF EMPLOYMENT 1. X. LABOR RELATIONS Atty. In the present case. Furthermore. Inc. Later. August 5. 13th month pay.

were deprived of seniority and other employment benefits they had when they were still with their former employer. G. the CA was correct in upholding the labor arbiter's finding that they had been illegally dismissed. employees must still earn a living. their employers must pay them full back wages. Inc. They became new employees of the latter firm and. without their consent. Having been illegally dismissed. CA: reversed the decision of the NLRC. and were not entitled to backwages and separation pay. Inc. 2. 1999. their employment was changed. Inc. This rule has been uniformly applied in subsequent cases. It employed petitioners Virgilio Agabon and Jenny Agabon as gypsum board and cornice installers on January 2. LABOR RELATIONS Atty. Bustamante v. should not preclude such award.R. Petitioners then filed a complaint for illegal dismissal and payment of money claims and on December 28. Page 118 . The other money claims awarded by the Labor Arbiter were also denied for lack of evidence. is engaged in the business of selling and installing ornamental and construction materials. Be it noted that. as penalty for their illegal dismissal. they lost their former work status and benefits in a manner violative of the law. While it may be true that petitioners continued to work in the same place and office as in their previous employment. Jefferson M. Hence this petition. NLRC. it is equally true that they had in fact been illegally dismissed by their previous employer. 1999 when they were dismissed for abandonment of work. While litigating. Furthermore. should not preclude such award. The fact that they worked for a sister company immediately after being dismissed from Insular Builders." They were not given any prior written notice. petitioners should be awarded back wages in accordance with Bustamante v. Inc. 158693. petitioners were dismissed because of a "change of management. No. Under the circumstances. NLRC: reversed the Labor Arbiter because it found that the petitioners had abandoned their work. as such. NLRC. Marquez for a sister company immediately after being dismissed from Insular Builders. In the present case. The Labor Arbiter: declared the dismissals illegal and ordered private respondent to pay the monetary claims. NLRC held that illegally dismissed employees were entitled to full back wages that should not be diminished or reduced by the amount they had earned from another employment during the period of their illegal dismissal. 1992 until February 23. November 17. but simply told that their services were terminated on the day they stopped working for Insular Builders. Agabon vs. Thus. 2004 Facts: Riviera Home Improvements.

and (e) other causes analogous to the foregoing. these two factors should be present: (1) the failure to report for work or absence without valid or justifiable reason. “In February 1999. A termination for an authorized cause requires Page 119 . with the second as the more determinative factor which is manifested by overt acts from which it may be deduced that the employees has no more intention to work. “The procedure for terminating an employee is found in Book VI. (d) commission of a crime or offense by the employee against the person of his employer or any immediate member of his family or his duly authorized representative. hence. the law also recognizes the right of the employer to expect from its workers not only good performance. Rule I. – In all cases of termination of employment. Jefferson M. The record of an employee is a relevant consideration in determining the penalty that should be meted out to him. a just cause for termination of employment by the employer. they did not report for work because they were working for another company. and (2) a clear intention to sever employer-employee relationship. “Dismissals based on just causes contemplate acts or omissions attributable to the employee while dismissals based on authorized causes involve grounds under the Labor Code which allow the employer to terminate employees. (c) fraud or willful breach by the employee of the trust reposed in him by his employer or his duly authorized representative. “The law imposes many obligations on the employer such as providing just compensation to workers. “Abandonment is the deliberate and unjustified refusal of an employee to resume his employment. The intent to discontinue the employment must be shown by clear proof that it was deliberate and unjustified. Section 2(d) of the Omnibus Rules Implementing the Labor Code: Standards of due process: requirements of notice. observance of the procedural requirements of notice and hearing in the termination of employment. with the assistance of counsel if the employee so desires. adequate work and diligence. Article 282 of the Labor Code enumerates the just causes for termination by the employer: (a) serious misconduct or willful disobedience by the employee of the lawful orders of his employer or the latter’s representative in connection with the employee’s work. and giving to said employee reasonable opportunity within which to explain his side. grounds have been established to justify his termination. Subcontracting for another company clearly showed the intention to sever the employer-employee relationship with private respondent. The employer may not be compelled to continue to employ such persons whose continuance in the service will patently be inimical to his interests. “To dismiss an employee. (b) gross and habitual neglect by the employee of his duties. the foregoing notices shall be served on the employee’s last known address. we now determine if the procedures for dismissal were observed. Ruling: Negative. the law requires not only the existence of a just and valid cause but also enjoins the employer to give the employee the opportunity to be heard and to defend himself. Marquez Issue: Whether petitioners were illegally dismissed. For termination of employment based on just causes as defined in Article 282 of the Code: (a) A written notice served on the employee specifying the ground or grounds for termination. LABOR RELATIONS Atty. It is a form of neglect of duty. the following standards of due process shall be substantially observed: I. In case of termination. petitioners were frequently absent having subcontracted for an installation work for another company. but also good conduct and loyalty. (b) A hearing or conference during which the employee concerned. is given opportunity to respond to the charge. On the other hand. For a valid finding of abandonment. In January 1996. Petitioners disregarded the warning and exhibited a clear intention to sever their employer-employee relationship. and (c) A written notice of termination served on the employee indicating that upon due consideration of all the circumstances. “After establishing that the terminations were for a just and valid cause. Private respondent at that time warned petitioners that they would be dismissed if this happened again. present his evidence or rebut the evidence presented against him. This was not the first time they did this.

But it did not. “In the second and third situations where the dismissals are illegal. if private respondent indeed paid petitioners’ holiday pay and service incentive leave pay. The reason for the rule is that the pertinent personnel files. i.. the manner of dismissal. While the procedural infirmity cannot be cured. Laurel observed. and other benefits or their monetary equivalent computed from the time the compensation was not paid up to the time of actual reinstatement. Even where the employee must allege non-payment. however. for an authorized cause under Article 283. and due process was observed. payrolls. “The employer should not be compelled to continue employing a person who is admittedly guilty of misfeasance or malfeasance and whose continued employment is patently inimical to the employer. (1) if the dismissal is based on a just cause under Article 282. i. the dismissal is undoubtedly valid and the employer will not suffer any liability. a notice of the decision to dismiss. “As a general rule. and (2) if the dismissal is based on authorized causes under Articles 283 and 284. It is a constitutional restraint on the legislative as well as on the executive and judicial powers of the government provided by the Bill of Rights. the employer must give the employee and the Department of Labor and Employment written notices 30 days prior to the effectivity of his separation. this is not a valid excuse because the law mandates the twin notice requirements to the employee’s last known address. the valid and authorized causes of employment termination under the Labor Code. the petitioners committed a grave offense. service incentive leave pay and 13th month pay without deductions. “The present case squarely falls under the fourth situation. would undoubtedly result in a valid dismissal. rather than on the employee to prove non-payment. as the term suggests. and of bringing about “the greatest good to the greatest number. “In the first situation. consistent with the fundamental and paramount objective of the state of promoting the health. Private respondent is liable for petitioners’ holiday pay. as amended by Department Order Nos. Section 1 of the Constitution embodies a system of rights based on moral principles so deeply imbedded in the traditions and feelings of our people as to be deemed fundamental to a civilized society as conceived by our entire history. inclusive of allowances. Consequently. Private respondent. one who pleads payment has the burden of proving it. like Constitutional due process. Thus. which. if the requirements of due process were complied with. “Due process under the Labor Code. the general rule is that the burden rests on the employer to prove payment.. Allegations by private respondent that it does not operate during holidays and that it allows its employees 10 days leave with pay. service incentive leave pay and 13th month pay. as amended. 9 and 10. “Procedurally. other than being self-serving. comfort. and procedural. 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. Marquez payment of separation pay. i. it should not invalidate the dismissal. it could have easily presented documentary proofs of such monetary benefits to disprove the claims of the petitioners. it failed to Page 120 .” “Private respondent claims that the Court of Appeals erred in holding that it failed to pay petitioners’ holiday pay. civil or administrative proceedings.D. remittances and other similar documents – which will show that overtime. “Constitutional due process protects the individual from the government and assures him of his rights in criminal. “In the fourth situation. Breaches of these due process requirements violate the Labor Code. Article 279 mandates that the employee is entitled to reinstatement without loss of seniority rights and other privileges and full backwages. and (4) the dismissal is for just or authorized cause but due process was not observed. the dismissal should be upheld. Rule I. while statutory due process found in the Labor Code and Implementing Rules protects employees from being unjustly terminated without just cause after notice and hearing. The dismissal should be upheld because it was established that the petitioners abandoned their jobs to work for another company. or for health reasons under Article 284. abandonment.e. The law protecting the rights of the laborer authorizes neither oppression nor self-destruction of the employer. When the termination of employment is declared illegal. “To be sure.e. As the eminent Justice Jose P. 2. do not constitute proof of payment. 442. Unfortunately for the private respondent. “We affirm the ruling of the appellate court on petitioners’ money claims. differentials. it should be held liable for non-compliance with the procedural requirements of due process. (2) the dismissal is without just or authorized cause but due process was observed.. If reinstatement is no longer possible where the dismissal was unjust. Due process is that which comports with the deepest notions of what is fair and right and just. Therefore statutory due process should be differentiated from failure to comply with constitutional due process. the Due Process Clause in Article III. and quiet of all persons. “In the case at bar. social justice must be founded on the recognition of the necessity of interdependence among diverse units of a society and of the protection that should be equally and evenly extended to all groups as a combined force in our social and economic life. Social justice. reinstatement and full backwages are mandated under Article 279. the employer should be held liable for non-compliance with the procedural requirements of due process.e. Sec. has two aspects: substantive. (3) the dismissal is without just or authorized cause and there was no due process. “From the foregoing rules four possible situations may be derived: (1) the dismissal is for a just cause under Article 282 of the Labor Code. except with respect to the 13th month pay wherein it presented cash vouchers showing payments of the benefit in the years disputed. However. otherwise known as the Labor Code of the Philippines in Book VI. Procedural due process requirements for dismissal are found in the Implementing Rules of P. service incentive leave and other claims of workers have been paid – are not in the possession of the worker but in the custody and absolute control of the employer. “We are not persuaded. should be used only to correct an injustice. “It must be stressed that in the present case. Jefferson M. the employer must give the employee two written notices and a hearing or opportunity to be heard if requested by the employee before terminating the employment: a notice specifying the grounds for which dismissal is sought a hearing or an opportunity to be heard and after hearing or opportunity to be heard. “An employee who is clearly guilty of conduct violative of Article 282 should not be protected by the Social Justice Clause of the Constitution. separation pay may be granted. records. LABOR RELATIONS Atty.

3. to wit: (f) “Wage” paid to any employee shall mean the remuneration or earnings. or commission basis. In time. or other method of calculating the same.520. No. lodging. for short) until the latter terminated their employment on August 29. however designated. Issues: Does the absence of the notice of hearing in dismissal due to authorize cause amounts to illegal dismissal? Page 121 . Marlon Domingo. 1997 because the corporation was “in dire financial straits”. respondents separately filed with the regional Arbitration Branch of the National Labor Relations Commission (NLRC) complaints for illegal dismissal. 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. G. private respondent failed to show that the deduction of the SSS loan and the value of the shoes from petitioner Virgilio Agabon’s 13th month pay was authorized by the latter. or other facilities customarily furnished by the employer to the employee…” from which an employer is prohibited under Article 113 of the same Code from making any deductions without the employee’s knowledge and consent. which is payable by an employer to an employee under a written or unwritten contract of employment for work done or to be done. Rosana Castelo. we find the same to be unauthorized. the Labor Arbiter rendered a decision declaring the termination illegal and ordering JAKA and its HRD Manager to reinstate respondents with full backwages.00 and the balance of Virgilio Agabon’s thirteenth month pay for 1998 in the amount of P2. underpayment of wages and nonpayment of service incentive leave and 13th month pay against JAKA and its HRD Manager. and separation pay if reinstatement is not possible. March 28. LABOR RELATIONS Atty. In the instant case. service incentive leave pay for the same period in the amount of P3. Robert Parohinog. or for services rendered or to be rendered and includes the fair and reasonable value. It is not disputed. respondents separately filed with the regional Arbitration Branch of the National Labor Relations Commission (NLRC) complaints for illegal dismissal. Jaka Food Processing vs. After due proceedings. “The Court of Appeals properly reinstated the monetary claims awarded by the Labor Arbiter ordering the private respondent to pay each of the petitioners holiday pay for four regular holidays from 1996 to 1998. The evident intention of Presidential Decree No. 851 is to grant an additional income in the form of the 13th month pay to employees not already receiving the same so as “to further protect the level of real wages from the ravages of world-wide inflation. After due proceedings. More specifically the decision dispositively reads: In time. David Bisnar. task. The lack of authority to deduct is further bolstered by the fact that petitioner Virgilio Agabon included the same as one of his money claims against private respondent. in the amount of P6. the Labor Arbiter rendered a decision declaring the termination illegal and ordering JAKA and its HRD Manager to reinstate respondents with full backwages.00. as determined by the Secretary of Labor. 151378. piece . however.255. as additional income. of board. “Anent the deduction of SSS loan and the value of the shoes from petitioner Virgilio Agabon’s 13 th month pay. capable of being expressed in terms of money whether fixed or ascertained on a time.R.” Clearly. Pacot.150. Jefferson M. the 13th month pay is included in the definition of wage under Article 97(f) of the Labor Code. Marquez discharge the onus probandi thereby making it liable for such claims to the petitioners.00. Rosana Castelo. Rhoel Lescano and Jonathan Cagabcab were earlier hired by petitioner JAKA Foods Processing Corporation (JAKA. 2005 Facts: Respondents Darwin Pacot. and separation pay if reinstatement is not possible. underpayment of wages and nonpayment of service incentive leave and 13th month pay against JAKA and its HRD Manager.

e. it is established that JAKA failed to comply with the notice requirement under the same Article. is that in all cases of business closure or cessation of operation or undertaking of the employer. is guilty of some fraud against the employer. Petitioner failed to submit the required documents. The exception is when the closure of business or cessation of operations is due to serious business losses or financial reverses. a 1x1 ID picture. while in the second. and (2) if the dismissal is based on an authorized cause under Article 283 but the employer failed to comply with the notice requirement. The clear-cut distinction between a dismissal for just cause under Article 282 and a dismissal for authorized cause under Article 283 is further reinforced by the fact that in the first. retrenchment. duly proved. or is guilty of. NLRC. when the employer opts to install labor saving devices. he has neglected his duties. we. it can be said that the employee himself initiated the dismissal process. it is wise to hold that: (1) if the dismissal is based on a just cause under Article 282 but the employer failed to comply with the notice requirement. 1999 to comply. LABOR RELATIONS Atty. as in this case. therefore. when he decides to cease business operations or when. 4. and clearance from the employee's previous employment. Mauricio v. the affected employee is entitled to separation pay. i. 164635.000. November 17. 3. i. initiated by an act imputable to the employee. the law requires payment of separation pay. therefore. NLRC we made the following declaration: “The rule. 1999 as a probationary employee. G. and when based on one of the authorized causes under Article 283. 2 x 2 ID picture. the sanction to be imposed upon him should be tempered because the dismissal process was. affording full protection to its rights as well as its welfare. Accordingly. Considering the factual circumstances in the instant case and the above ratiocination. as in Agabon. therefore. as a rule. For these reasons. which is one of the authorized causes enumerated under Article 283 of the Labor Code. the right of affected employees to separation pay is lost for obvious reasons. Page 122 . established that there was ground for respondents’ dismissal. On another breath. The bank gave her up to December 15. a dismissal for an authorized cause under Article 283 does not necessarily imply delinquency or culpability on the part of the employee. Marquez Are the dismissed employees. i. the employee has committed some serious misconduct. Jefferson M.e. is not required. entitled to separation pay? Ruling: A dismissal for just cause under Article 282 implies that the employee concerned has committed. in which case.R.e. 2005 Facts: 1. Thus. or.. among other things. he undertakes to implement a retrenchment program. Instead.00. and advised her that the processing of her regularization as employee would be held in abeyance. 2. As a pre-employment requirement. Likewise. We likewise find the Court of Appeals to have been in error when it ordered JAKA to pay respondents separation pay equivalent to one (1) month salary for every year of service. payment of separation pay. Petitioner Mauricio. deem it proper to fix the indemnity at P50. the sanction should be stiffer because the dismissal process was initiated by the employer’s exercise of his management prerogative. two reference letters. started working as an Administrative Assistant in the Legal Department of the Manila Banking Corporation on July 1. This is consistent with the state policy of treating labor as a primary social economic force. It is. the dismissal process is initiated by the employer’s exercise of his management prerogative. This is because in Reahs Corporation vs. there ought to be a difference in treatment when the ground for dismissal is one of the just causes under Article 282. because of company’s serious losses. some violation against the employer. in effect. xxx”. No. the bank directed the submission by petitioner of.

by letter of December 28.” In the case of San Miguel Brewery Sales Force Union vs. informed the bank that she could not secure a clearance from her previous employer. Petitioner filed on January 21. is a standing policy of Manilabank applicable especially to bank officers. to allow an exemption to the rule that the same should be submitted prior to the expiration of the 6- month probationary employment will create a precedent which will prejudice an established hiring policy. However. Marquez 4. no employer in his right mind would engage the regular service of an employee unless he is certain of the moral character of a probationary employee applying as regular employee. one of which is a clearance from the previous employer if one is previously employed. Ople (170 SCRA 25). For sure. the Honorable Supreme Court ruled that: “Except as limited by special laws.” Page 123 . SC affirmed the Labor Arbiter’s decision. an employer is free to regulate according to his own discretion and judgment. The bank further reasoned that. 6. 1999 to submit the requirements. including hiring. and informing that her failure to do so would cause the termination of her employment effective December 29. the Manila Bankers Life Insurance Corporation. 5. and moral and exemplary damages against the bank. Petitioner. petitioner still failed to comply with the requirements. Mauricio’s probationary employment was validly terminated by the bank. 7. drawing the bank to send her a Memorandum giving her until December 29. the bank denied petitioner's request on the ground that the submission of the pre-employment requirements. a sister company of the bank. Issue: W/N Mauricio’s probationary employment was validly terminated by Manila Banking Corporation Ruling: Yes. By reply memorandum. Jefferson M. 1999. In denying Muricio’s petition. To quote: “The submission of clearance from a previous employer is a reasonable requirement to qualify as a regular employee upon the expiration of the six months probationary employment. Despite the deadline given her. To say that the requirement is a mere formality is an oversimplification of the long standing policy in the bank industry. LABOR RELATIONS Atty. 2000 a complaint for illegal dismissal. She thus requested that any action relative to her employment be held in abeyance as she was still following up the early resolution of the case. This reasonable regulation is mandatory in the sense that it speaks of the employee's character before he or she becomes a regular employee. as she had a pending case with it. 1999. unpaid salary. the bank was still open in the event that petitioner will secure the required clearance form (sic) Manila Bankers Life and would consider her future employment with Manilabank. all aspects of employment. not to mention the legal implication of waiver on the part of the bank to further require submission of the clearance after the lapse of the probationary employment.

2007 Facts: Industrial Plywood Group Corporation (IPGC) is the owner of a plywood plant located at Agusan. 1990. and whether they are entitled to separation pay. This was followed by a final notice of closure or cessation of business operations on August 17. 1999. ITC commenced operation of the plywood plant and hired 387 workers. Ababon. 1990. It was only on December 28. to file a complaint against ITC and IPGC for illegal dismissal. were illegally dismissed due to the closure of ITC’s business. 1990 it will undergo a “no plant operation” due to lack of raw materials and will resume only after it can secure logs for milling. This fact and the alleged lack of logs for milling constrained ITC to lay off all its workers until further notice. three requirements are necessary for a valid cessation of business operations: (a) service of a written notice to the employees and to the DOLE at least one month before the intended date thereof. IPGC notified ITC of the expiration of the lease contract in August 1990 and its intention not to renew the same. 1990 with an advice for all the workers to collect the benefits due them under the law and CBA. (b) the cessation of business must be bona fide in Page 124 . No. In fact. it is within the province of respondents to deny the regularization of complainant. 1990.R. Janury 25. 164518. WPR-1004-081791-042. Meanwhile. complainant was directed to submit the documents required for regularization but she dilly-dallied. This prompted Virgilio Ababon. backwages. ITC notified the Department of Labor and Employment (DOLE) and its workers that effective March 19. leased to Industrial Timber Corporation (ITC) on August 30. G. which included the anti- pollution permit. complainant was given a six month period to produce the clearance requirement and as early as November 26. 5. et al. Ruling: Under Article 283 of the Labor Code. On June 26. among others. 2006 and March 28. ITC notified the DOLE and its workers of the plant’s shutdown due to the non-renewal of anti-pollution permit that expired in April 1990. and other monetary awards. by the Department of Environment and Natural Resources (DENR) coincidentally on the same day the ITC ceased operation of the plant. They alleged. LABOR RELATIONS Atty. Jefferson M. Pequeño. On October 15. et al. On March 16. unfair labor practice and damages. 1999 or a day before the deadline that complainant wrote her previous employer about the issuance of the clearance requirement but considering that complainant has a pending questionably petty cash liquidation problem upon audit. Thereafter. The fact that complainant's previous employer cannot issue a clearance because of pending questionable transaction in which complainant is involved. Industrial Timber Corp. Butuan City. Marquez The pre-employment requirements of respondent bank which was made known to complainant upon the inception of her employment were not shown to be unreasonable so as to render ineffectual complainant's denial as regular employee. that the cessation of ITC’s operation was intended to bust the union and that both corporations are one and the same entity being controlled by one owner. vs. 1985 for a period of five years. IPGC took over the plywood plant after it was issued a Wood Processing Plant Permit No. the clearance cannot be issued before the expiration of the six months probationary period. Issue: Whether or not Ababon.

the sanction should be stiff as the dismissal process was initiated by the employer’s exercise of his management prerogative. In the case at bar. Ababon. to invalidate a dismissal merely because of a procedural defect creates absurdity and runs counter to public interest. in a letter-petition to the Chairman of the Board of Directors. 102467. petitioner Bank terminated the services of respondent Sadac. neglect of duty and retrenchment. On August 17. whichever is higher. as opposed to a dismissal based on a just cause under Article 282 with the same procedural infirmity where the sanction to be imposed upon the employer should be tempered as the dismissal process was. Pacot. the ITC sent its employees a final notice of closure or cessation of business operations to take effect on the same day it was released. remained valid because the non-compliance with the notice and hearing requirement in the Labor Code did not undermine the validity of the grounds for the dismissals. 2006 Facts: Respondent Sadac was appointed Vice President of the Legal Department of petitioner Bank effective 1 August 1981. Since then several subsequent incidents prevented respondent ITC to resume its business operations e.R. whichever is higher. Although the closure was done in good faith and for valid reasons. however. the conclusion is inevitable that said closure is valid. In reaction thereto.g. G. respondent Sadac filed a complaint for illegal dismissal with damages against petitioner Bank and individual members of the Board of Directors thereof. After learning of the filing of the complaint. on 10 August 1989. we find it no longer necessary to discuss the issue regarding the computation of their backwages. As borne out from the records. G.R. in effect. namely. initiated by an act imputable to the employee. anti-pollution permit. accused respondent Sadac of abusive conduct and petitioned for a change in leadership of the department. Marquez character. Where the dismissal is based on an authorized cause under Article 283 of the Labor Code but the employer failed to comply with the notice requirement. This fact is admitted by complainants (Minutes of hearing. and subsequently General Counsel thereof on 8 December 1981. respondent Sadac was removed from his office and ordered disentitled to any compensation and other benefits. expiration and non-renewal of the wood processing plant permit. Thus. LABOR RELATIONS Atty. Consequently. et al. petitioner Bank instructed respondent Sadac to deliver all materials in his custody in all cases in which the latter was appearing as its counsel of record. his dismissal not being grounded on any of the causes stated in Article 282 of the Labor Code and there being Page 125 . However. No. 1997. National Labor Relations Commission and Jaka Food Processing Corporation v. And without the contract of lease respondent ITC has no option but to cease operation and turn over the plant to the lessor. The Supreme Court find that ITC did not comply with the notice requirement. this shutdown was only temporary as ITC assured its employees that they could return to work once the renewal is acted upon by the DENR. 6. Without the permits it cannot lawfully operate the plant. under the rules of client and lawyer relationship. 1990 due to lack of raw materials. Having established that ITC’s closure of the plywood plant was done in good faith and that it was due to causes beyond its control. and the lease contract on the plywood plant. 28 October 1991). On the ground of lack of confidence in respondent Sadac. and (c) payment to the employees of termination pay amounting to one month pay or at least one-half month pay for every year of service. The issues on the existence of employer-employee relationship as well as the legality of the dismissal were decided by the Court in the case of Equitable Banking Corporation vs. wherein it was held that there was employer-employee relationship between petitioner Bank and respondent Sadac and that Sadac's dismissal was illegal. This was followed by a ‘shut down’ notice dated June 26. 1990. June 8. respondent Sadac requested for a full hearing and formal investigation but the same remained unheeded. While an employer is under no obligation to conduct hearings before effecting termination of employment due to authorized cause. The grounds for the dismissals in those cases. We find that this falls short of the notice requirement for termination of employment due to authorized cause considering that the DOLE was not furnished and the notice should have been furnished both the employees and the DOLE at least one month before the intended date of closure. However. nine lawyers of petitioner Bank’s Legal Department. 1990 due to the expiration of the anti-pollution permit. On 9 November 1989. ITC notified its employees and the DOLE of the ‘no plant operation’ on March 16. Without the raw materials respondent ITC has nothing to produce. NLRC. June 13. Equitable Bank vs Sadac. the Court sustained the dismissals for just cause under Article 282 and for authorized cause under Article 283 of the Labor Code. Jefferson M. they are entitled to separation pay equivalent to one month pay or at least one-half month pay for every year of service. On 26 June 1989. 164772. respondent ITC actually underwent ‘no plant operation’ since 19 March 1990 due to lack of log supply. Finally. respectively. despite non-compliance with the statutory requirement of notice and hearing. No. Indeed. In Agabon v. could not have been illegally dismissed to be entitled to full backwages. the law requires that it must notify the DOLE and its employees at least one month before the intended date of closure.

7. Judicial precedents tell us that an unqualified award of backwages means that the employee is paid at the wage rate at the time of his dismissal. there is no vested right to salary increases. the plain conclusion is that respondent Sadac’s computation of his full backwages which includes his prospective salary increases cannot be permitted. Thus. the same should have been explicitly stated in the same manner that the law used clear and unambiguous terms in expressly providing for the inclusion of allowances and other benefits. they are deemed part of the employee’s salary." Indeed. and sometimes in the nature of reimbursement. Marquez disregard of the procedural requirements in terminating Sadac's employment. In contrast. including cosmetics. Rey. salary increases are amounts which are added to the employee’s salary as an increment thereto for varied reasons deemed appropriate by the employer. The term "allowances" is sometimes used synonymously with "emoluments. perfumes. That respondent Sadac may have received salary increases in the past only proves fact of receipt but does not establish a degree of assuredness that is inherent in backwages. Jefferson M. A salary increase cannot be interpreted as either an allowance or a benefit.000. to retirement benefits in accordance with law. intimate apparels. Article 279 mandates that an employee’s full backwages shall be inclusive of allowances and other benefits or their monetary equivalent. or the employee’s continued stay in a position subject to management prerogative to transfer him to another position where his services are needed. Ruling: General salary increases are not included in the base figure to be used in the computation of backwages. August 31. salary increases are a mere expectancy. through its various outlets nationwide. but which is sometimes in the nature of compensation. the petitioner engages and contracts with dealers to sell the aforementioned merchandise.R.R. which may or may not be earned. thereupon. 102467. ready to wear clothes and other novelty items. inclusive of regular allowances that the employee had been receiving such as the emergency living allowances and the 13th month pay mandated under the law. No. if the intent were to include salary increases as basis in the computation of backwages. shows that the award of backwages therein is unqualified. G." as indirect or contingent remuneration. He shall also be paid an additional amount of P5. In said case. No.00. From the foregoing. "to otherwise give the meaning other than what the law speaks for by itself. known either as “Independent Business Page 126 . will open the floodgates to various interpretations. In the pursuit of its business. Salary increases are not separate grants by themselves but once granted. and in addition to the wage or salary. These dealers. 1499013. The controversy in the present case arises on the computation of backwages wherein respondent Sadac included the general salary increases in said computation while petitioner Bank insists that the general salary increases should not be included in the computation of backwages but rather the computation should be based on the wage rate at the time of dismissal. Furthermore. LABOR RELATIONS Atty. Allowances and benefits are granted to the employee apart or separate from. the base figure to be used in the computation of backwages is pegged at the wage rate at the time of the employee’s dismissal. To extend the coverage of an allowance or a benefit to include salary increases would be to strain both the imagination of the Court and the language of law. including the company’s fiscal situation and even the employee’s future performance on the job. 2006 Facts: The House of Sara Lee (petitioner) is engaged in the direct selling of a variety of product lines for men and women. They are. respondent Sadac was held to be entitled to backwages from termination of employment until turning sixty (60) years of age (in 1995) and. and cannot be confused with either. by its nature volatile and are dependent on numerous variables. Salary increases are not akin to allowances or benefits. Issue: Whether or not general salary increases should be included in the base figure to be used in the computation of backwages. In addition. a cursory reading of the dispositive portion of the Court’s Decision of 13 June 1997 in G. awarding backwages to respondent Sadac. In short. As observed by the NLRC. Heirs of Sara Lee vs.

generally. Employers. management undertook an audit of the Cagayan de Oro City and Butuan City branches. 1996. backwages and damages. The nature of her work requires a substantial amount of trust and confidence on the part of the employer. the petitioner. But. the CA dismissed the Petition on the sole ground that factual issues are not proper subjects for a special civil action of certiorari. on June 25. Law and jurisprudence have long recognized the right of employers to dismiss employees by reason of loss of trust and confidence. Respondent’s unauthorized extensions of the credit periods of the dealers are prejudicial to the interest of the petitioner and bear serious financial implications. 1998. for the law. On October 29. the NLRC rendered its decision dismissing the appeal. The duties of the respondent included the strict monitoring of the 38. Aggrieved. than in the case of ordinary rank- and-file employees. while respondent was still working in Butuan City. to change the credit term of one of the IBMs of the petitioner. in protecting the rights of the employee. Magi Caroline Mendoza. such as the custody. would obtain at discounted rates the merchandise from the petitioner on credit and then sell the same products to their own customers at fixed prices also determined by the petitioner. Loss of confidence as a just cause for dismissal is premised on the fact that an employee concerned holds a position of trust and confidence. It would be oppressive and unjust to order the petitioner to take her back. the alleged voluntary admissions of respondent. There can be no doubt continuance in the sensitive fiduciary position of Credit Administration Supervisor would be patently inimical to the interests of the petitioner. as well as the supervision of the credit and collection of payments and outstanding accounts due to the petitioner from its dealers. at the time of her dismissal from employment. and the findings of the auditor’s report. respondent’s position involves a high degree of responsibility requiring trust and confidence. held the position of Credit Administration Supervisor or CAS at the Cagayan de Oro City branch of the petitioner. the petitioner appealed to the NLRC. or care and protection of the employer’s property. More importantly. respondent occupied a highly sensitive and critical position and may thus be dismissed on the ground of loss of trust and confidence. as it relates closely to the financial interests of the company. On August 25. The computation of these commissions depends on whether the dealer concerned was able to remit the sales proceeds within the 38-day or 52-day rolling deadline. 2000. Page 127 . More so. with the Labor Arbiter. Sometime in June 1995. the act complained of must be “work-related. authorizes neither oppression nor self-destruction of the employer. Jefferson M. handling. Mariam Rey-Petilla. a certain Ms. respondent filed her Complaint for illegal dismissal. Cynthia Rey (respondent). LABOR RELATIONS Atty. On September 24. are allowed a wider latitude of discretion in terminating the employment of managerial personnel or those of similar rank performing functions which by their nature require the employer’s trust and confidence. as stated above. in the case of supervisors or personnel occupying positions of responsibility. in order to constitute a just cause for dismissal. The petitioner appealed to the CA under Rule 65. who happens to be respondent’s sister-in-law. depending on whether they sell individually or through their own group. respondent has a direct hand in the preparation and computation of the Service Fees or sales commissions accruing to each dealer. or on June 25. The position carried with it the duty to observe proper company procedures in the fulfillment of her job. Clearly. Issue: Is the respondent dismissed for a just cause? Ruling: Contrary to the findings of the NLRC and the CA. the Labor Arbiter rendered a decision in favor of the respondent. 1996. Being the Credit Administration Supervisor of the Cagayan de Oro and Butuan City branches of the petitioner.” such that the employee concerned is unfit to continue working for the employer. the Court holds that respondent was dismissed for a just cause. she allegedly instructed the Accounts Receivable Clerk of the Cagayan de Oro outlet. . On the basis of the hearing. the respondent is not an ordinary rank-and-file employee. On April 30. loss of trust justifies termination. 1996. formally dismissed the respondent for breach of trust and confidence. In the present case. from the 52-day limit to an “unauthorized” term of 60 days. This situation applies where a person is entrusted with confidence on delicate matters.” As a consequence of the discovery of the foregoing alleged “anomalous practice” of extending the credit terms of certain IBMs. a certain Ms.or 52-day “rolling due date” of each of its IBMs and IGSs. Marquez Managers” (IBMs) or “Independent Group Supervisors” (IGSs). 1998.

204.R.785. to wit: P65. Jefferson M.89 in 1998. On account of serious business losses which occurred in 1997 up to mid-1999 totaling around P127.429. petitioners contend that Galaxie did not serve written notices of the closure of business operations upon its employees. 2006. Galaxie’s documentary evidence shows that it had been experiencing serious financial losses at the time it closed business operations. nor did they establish that the closure was motivated by Galaxie’s anti-union stance. the same amount given to the employees who had executed quitclaims. Galaxie decided to close down its business operations. Whether or not the written notice posted by Galaxie on the company bulletin board sufficiently complies with the notice requirement under Article 283 of the Labor Code. and money claims against Galaxie. Galaxie thus filed on July 30. The Court finds no reason to modify such finding.753. Issues: Whether or not Galaxie is guilty of unfair labor practice in closing its business operations shortly after petitioner union filed for certification election. Besides. Their motion for reconsideration having been denied. Unfair labor practice refers to acts that violate the workers’ right to organize. And it reversed too the award for separation pay.000. the NLRC. 165757. True. In any event. was not sufficient to attribute anti-unionism against Galaxie. The NLRC upheld the Labor Arbiter’s decision but reversed the award of pro-rata 13th month pay and vacation and sick leave credits.480.00. as long as they are supported by substantial evidence from which an independent evaluation of the facts may be made. 1999 a written notice with the DOLE informing the latter of its intended closure and the consequent termination of its employees effective August 31.97 in 1999. Marquez 8. Petitioners Galaxie Steel Workers Union and Galaxie employees filed a complaint for illegal dismissal.389. Hence. citing North Davao Mining Facts: Galaxie is a corporation engaged in the business of manufacturing and sale of re-bars and steel billets which are used primarily in the construction of high-rise buildings. The Labor Arbiter declared valid Galaxie’s closure of business but nevertheless ordered it to pay the employees separation pay. Nevertheless. Upon the other hand. it having merely posted a notice on the company bulletin board. the union was seeking the holding of a certification election at the time that Galaxie closed its business operation. the petitioners had not presented evidence to the contrary. Galaxi Steel Workers Union vs. and are defined in Articles 248 and 261 of the Labor Code. petitioners filed a petition for certiorari with the Court of Appeals. the same not being among petitioners’ causes of action as in fact they were not even mentioned in their pleadings. As aptly found by the Court of Appeals: The NLRC’s finding on the legality of the closure should be upheld for it is supported by substantial evidence consisting of the audited financial statements showing that Galaxie continuously incurred losses from 1997 up to mid-1999. LABOR RELATIONS Atty. a rule which applies with greater force in labor cases where the findings of fact of the NLRC are accorded respect and even finality. and the CA were unanimous in ruling that Galaxie’s closure or cessation of business operations was due to serious business losses or financial reverses. the Labor Arbiter. the closure of Galaxie’s business being due to serious business losses. Indeed. the NLRC directed Galaxie to grant petitioners. petitioners failed to present concrete evidence supporting their claim of unfair labor practice.65 in 1997. It is settled that SC is not a trier of facts. P48.000. without more. In this case. arguing that the NLRC acted with grave abuse of discretion in not finding Galaxie guilty of unfair labor practice and of violating petitioners’ right to notice of closure. Ruling: Petitioners contend that the Court of Appeals erred in not finding that Galaxie’s closure of business operations was motivated not by serious business losses but by their anti-union stance. October 17. by way of financial assistance. NLRC. No. and in deleting the award of separation pay. pro-rata 13th month pay. CA upheld the NLRC decision. the present petition for review. 1999. but that. And it posted the notice of closure on the corporate bulletin board. and of the various demand notices of payments from creditor banks. unfair labor practice. and not because of any alleged anti-union position. G. and P13. and vacation and sick leave credits. Whether or not petitioners are entitled to separation pay. The prohibited acts relate to the workers’ right to self-organization and to the observance of Collective Bargaining Page 128 .

" The purpose of the written notice is to inform the employees of the specific date of termination or closure of business operations. the bank reappointed him as branch manager for a term of one year from August 18. Inc. With regard to the notice requirement. this Court held that where the dismissal is for an authorized cause. wherein he requested the timely release of his retirement pay and other benefits. Unconvinced of Sy explanation. 2006 Facts: Petitioner Dennis Sy was the branch manager in Bajada.R." Where. Nevertheless. . the lack of statutory due process should not nullify the dismissal. the Labor Arbiter found. 2000. the labor arbiter’s decision was reinstated. the bank released the results of the audit conducted. for the violation of his right to statutory due process. Jefferson M. on November 15. 160618. the bank dismissed Sy. the Labor Code does not impose any obligation upon the employer to pay separation benefits. which reiterated the ruling in Agabon v. Sy. the better rule is to declare that the dismissal was for cause but imposing sanctions on the employer. notified Sy of other violations of company policies. LABOR RELATIONS Atty. By so doing. in North Davao Mining Corporation v. G. 1999 under the bank’s retirement plan. 1999. Respecting petitioners’ claim for separation pay. whichever comes earlier. v. Davao City of respondent Metropolitan Bank and Trust Company. this Court held that Article 283 governs the grant of separation benefits "in case of closures or cessation of operation" of business establishments "NOT due to serious business losses or financial reverses . On appeal. however. in the form of nominal damages. the validity of termination of services can exist independently of the procedural infirmity in the dismissal. 1999 until August 18. 1999. When brought up to the Court of Appeals. His request was denied. The denial of petitioners’ claim for separation pay was thus in order. National Labor Relations Commission. but without observance of statutory due process. the NLRC deemed Sy compulsorily retired. on February 5. Sy would have rendered 30 years of service by August 18. No. Sy vs. Metro Bank. Issues: Page 129 . National Labor Relations Commission. Marquez Agreement without which relation the acts. The bank placed Sy on preventive suspension. service of the written notice must be made individually upon each and every employee of the company. a few months before he was supposed to retire. The mere posting on the company bulletin board does not. tendered an irrevocable letter of retirement. 1999. and must be served upon them at least one month before the date of effectivity to give them sufficient time to make the necessary arrangements. the closure then is due to serious business losses. that the written notice of closure or cessation of Galaxie’s business operations was posted on the company bulletin board one month prior to its effectivity. not satisfied with his answer. Sy responded that he only made a wrong credit judgment. The bank. or render it illegal. However. or ineffectual. November 2. are not deemed unfair labor practices. After analyzing the consequences of the divergent doctrines on employment termination. In order to meet the foregoing purpose. which was dismissed by the labor arbiter for lack of merit. Sy then filed a case for illegal dismissal. . The bank averred that Sy has allowed client-Spouses Ong to conduct “kiting” activities in their account. dispensing justice not just to employees but to employers as well is achieved. with a corresponding salary increase effective August 16. In November 1999. However. which provides that an employee must retire upon reaching 55 years of age or after rendering 30 years of service. meet the requirement under Article 283 of "serving a written notice on the workers. the Court held that in cases involving dismissals for cause. Court of Appeals. 9. the employer should indemnify the employee. and it was upheld by the NLRC and the Court of Appeals. no matter how unfair. In Business Services of the Future Today.

Thus. Jefferson M. he authorized “kiting” or drawing of checks against uncollected funds in wanton violation of the bank’s policies. 2001 incident. King of Kings Transport vs. Since petitioner’s dismissal was for a just cause. In his letter. 2001 Conductor's Report of respondent. the company issues an "Irregularity Report" against the employee. would he still be entitled to retirement benefits? Ruling: No. respondent said that the erroneous declaration in his October 28. Petitioner. Indeed. he got confused in making the trip report. while serving such extended term. He explained that during that day's trip. in effect. That decision shall be stated on said Irregularity Report and will be furnished to the employee. 2001. No. and they had to cut short the trip in order to immediately report the matter to the police. June 29. Records show that as bank manager. Upon audit of the October 28. G. No.R. the windshield of the bus assigned to them was smashed. 2001. 2007 Facts: Respondent Mamac was hired as bus conductor of Don Mariano Transit Corporation (DMTC) on April 29. 1999. theorizes that having been compulsorily retired. only unjustly dismissed employees are entitled to retirement benefits and other privileges including reinstatement and backwages. KKTI nevertheless asked respondent to explain the discrepancy. the company audits the reports. 166208. this report indicates the ticket opening and closing for the particular day of duty. Sy was validly dismissed on the ground of fraud and willful breach of trust under Article 282 of the Labor Code. As a result of the incident. indicating the nature and details of the irregularity. he opted to accept the bank’s offer of extending his employment for another year with a corresponding salary increase. It discovered that respondent declared several sold tickets as returned tickets causing KKTI to lose an income of eight hundred and ninety pesos. 10. Once an irregularity is discovered. the company then makes a determination of whether to accept the explanation or impose upon the employee a penalty for committing an infraction. he had never retired. LABOR RELATIONS Atty. The dismissal letter alleged that the October 28. Under the Labor Code. While no irregularity report was prepared on the October 28. On November 26. where breach of trust as a ground for valid dismissal requires proof of involvement in the alleged anomaly and where mere uncorroborated accusation by the employer will not suffice. NLRC. the sheer existence of a basis for believing that the employer’s trust has been breach is enough for the dismissal of a managerial employee. 2001 irregularity was an act of fraud against the company. After submission. he could no longer be dismissed by the bank. KKTI also cited as basis for respondent's dismissal the other offenses Page 130 . Respondent was required to accomplish a "Conductor's Trip Report" and submit it to the company after each trip. It was sufficient basis for the bank to lose trust in him. His premise is absurd. however. KKTI noted an irregularity. he is not entitled to any retirement benefit. However. Marquez Was Sy illegally terminated? If his dismissal was valid. Thereafter. the bank discovered his unauthorized grant of accommodation to accounts engaged in “kiting” activity. He cannot now elude dismissal for a just cause by claiming he was already retired compulsorily. the concerned employee is asked to explain the incident by making a written statement or counter-affidavit at the back of the same Irregularity Report. After considering the explanation of the employee. Unlike a rank-and-file worker. 2001 Trip Report was unintentional. Unfortunately for him. he would have qualified for compulsory retirement under the bank’s Retirement Plan. respondent received a letter terminating his employment effective November 29. Such act is a clear breach of the trust in him by the bank. As a background.

— . 2. Non-compliance with the Due Process Requirements Art. . Accordingly. illegal deductions. and second. Respondent filed a Complaint for illegal dismissal. Miscellaneous Provisions.Standards of due process. Issue: Whether or not procedural requirements were complied with. thus: Art. he claimed that his dismissal was effected without due process. service incentive leave. 277 of the Labor Code provides the manner of termination of employment. It claimed that respondent had violated the trust and confidence reposed upon him by KKTI. nonpayment of 13th-month pay. — In all cases of termination of employment. and separation pay. Moreover. Jefferson M. the following standards of due process shall be substantially observed: Page 131 . Any decision taken by the employer shall be without prejudice to the right of the worker to contest the validity or legality of his dismissal by filing a complaint with the regional branch of the National Labor Relations Commission. requirements of notice. substantive — the valid and authorized causes of termination of employment under the Labor Code. procedural — the manner of dismissal. He denied committing any infraction and alleged that his dismissal was intended to bust union activities. Also. . the employer shall furnish the worker whose employment is sought to be terminated a written notice containing a statement of the causes for termination and shall afford the latter ample opportunity to be heard and to defend himself with the assistance of his representative if he so desires in accordance with company rules and regulations promulgated pursuant to guidelines set by the Department of Labor and Employment. Ruling: Due process under the Labor Code involves two aspects: first. 277. LABOR RELATIONS Atty. (b)Subject to the constitutional right of workers to security of tenure and their right to be protected against dismissal except for a just and authorized cause without prejudice to the requirement of notice under Article 283 of this Code. KKTI contended that respondent was legally dismissed after his commission of a series of misconducts and misdeeds. the implementing rule of the aforesaid provision states: SEC. The burden of proving that the termination was for a valid or authorized cause shall rest on the employer. it averred that it had observed due process in dismissing respondent and maintained that respondent was not entitled to his money claims such as service incentive leave and 13th-month pay because he was paid on commission or percentage basis. Marquez he allegedly committed since 1999.

are violated and/or which among the grounds under Art. (2) present evidence in support of their defenses. Jefferson M. (3)After determining that termination of employment is justified. grounds have been established to justify his termination. v. it maintains that it had substantially complied with the rules. (2)After serving the first notice. and (2) grounds have been established to justify the severance of their employment. Moreover. the employers shall serve the employees a written notice of termination indicating that: (1) all circumstances involving the charge against the employees have been considered. in order to enable the employees to intelligently prepare their explanation and defenses. present his evidence. Lastly. In the instant case. "Reasonable opportunity" under the Omnibus Rules means every kind of assistance that management must accord to the employees to enable them to prepare adequately for their defense. with the assistance of counsel if he so desires is given opportunity to respond to the charge. The law is clear on the matter." We are not convinced. the Court held that Page 132 . the employees are given the chance to defend themselves personally. consult a union official or lawyer. During the hearing or conference. (b)A hearing or conference during which the employee concerned. the employers should schedule and conduct a hearing or conference wherein the employees will be given the opportunity to: (1) explain and clarify their defenses to the charge against them. 282 is being charged against the employees." However. and (3) rebut the evidence presented against them by the management. In case of termination. this conference or hearing could be used by the parties as an opportunity to come to an amicable settlement. the following should be considered in terminating the services of employees: (1)The first written notice to be served on the employees should contain the specific causes or grounds for termination against them. (c)A written notice of termination served on the employee. KKTI admits that it had failed to provide respondent with a "charge sheet. the foregoing notices shall be served on the employee's last known address. A general description of the charge will not suffice. To clarify. NLRC. gather data and evidence. the notice should specifically mention which company rules. with the assistance of a representative or counsel of their choice. the notice should contain a detailed narration of the facts and circumstances that will serve as basis for the charge against the employees. if any. claiming that "respondent would not have issued a written explanation had he not been informed of the charges against him. This should be construed as a period of at least five (5) calendar days from receipt of the notice to give the employees an opportunity to study the accusation against them. and giving said employee reasonable opportunity within which to explain his side. indicating that upon due consideration of all the circumstances. or rebut the evidence presented against him. A verbal appraisal of the charges against an employee does not comply with the first notice requirement. and a directive that the employees are given the opportunity to submit their written explanation within a reasonable period. respondent was not issued a written notice charging him of committing an infraction.For termination of employment based on just causes as defined in Article 282 of the Code: (a)A written notice served on the employee specifying the ground or grounds for termination. In Pepsi Cola Bottling Co. Moreover. First. and decide on the defenses they will raise against the complaint. LABOR RELATIONS Atty. Marquez I.

2007 Facts: A complaint for illegal dismissal was filed by respondents Ma. Inc. respondent made the letter merely to explain the circumstances relating to the irregularity. Johnson Office & Sales Union. the doctrine in Serrano had already been abandoned in Agabon v. prompting respondents to elevate the matter to the NLRC. no hearing was conducted. one of the former’s divisions. The reports did not even state a company rule or policy that the employee had allegedly violated. Third. after a finding that petitioners failed to comply with the due process requirements. Johnson and Johnson sought partial reconsideration but the NLRC denied the motion in a Resolution dated 11 February 2002. Likewise. Regardless of respondent's written explanation. He was unaware that a dismissal proceeding was already being effected. Neither party appealed from the resolution decision of the NLRC within the reglementary period. there is no mention of any of the grounds for termination of employment under Art. NLRC by ruling that if the dismissal is done without due process. 172799. The Labor Arbiter dismissed the complaint. LABOR RELATIONS Atty. Jesusa Bonsol and Rizalinda Hirondo against petitioners Johnson & Johnson (Phils. respondents were entitled to reinstatement.). the NLRC rendered a Resolution. NLRC. Thus. Jefferson M. petitioner KKTI is sanctioned to pay respondent the amount of thirty thousand pesos (PhP30. 282 of the Labor Code. Sanction for Non-compliance with Due Process Requirements As stated earlier.R. the employer should indemnify the employee with nominal damages. 11. July 6. for non-compliance with the due process requirements in the termination of respondent's employment. the CA awarded full backwages in favor of respondent in accordance with the doctrine in Serrano v. petitioner Johnson and Johnson reiterated their intention to satisfy respondents monetary award but the Page 133 . Marquez consultations or conferences are not a substitute for the actual observance of notice and hearing. modifying the decision of the Labor Arbiter. the Court observed the irregularity reports against respondent for his other offenses that such contained merely a general description of the charges against him. KKTI's "standard" charge sheet is not sufficient notice to the employee. and Janssen Pharmaceutica. Second. Thus. a hearing was still necessary in order for him to clarify and present evidence in support of his defense. No. hence. Johnson & Johnson v. On 14 December 2001.000) as damages. The Resolution dated 14 December 2001 became final and executory. G. However. 31 March 2004 At a conference held. The NLRC ruled that the violations of company procedure committed by respondents did not constitute serious misconduct or willful disobedience warranting their dismissal. Moreover.

the dispositive portion of said resolution ordered respondents reinstatement without. particularly where the illegally dismissed employee held a managerial or key position in the company. the payment of separation compensation in lieu of the reinstatement of an employee who was illegally dismissed from work shall be allowed if and only if the employer can prove the existence of circumstances showing that reinstatement will no longer be for the mutual benefit of the employer and employee. Well-entrenched is the rule that an illegally dismissed employee is entitled to reinstatement as a matter of right. as where reinstatement would only exacerbate the tension and strained relations between the parties. the NLRC erred and modified the Resolution dated 14 December 2001. Johnson and Johnson contends that the intent of the 14 December 2001 Resolution was to grant them the option to reinstate respondents to their former positions without the payment of backwages. Page 134 . petitioner filed a Manifestation and Motion. Issue: Whether or not Johnson and Johnson. Thus. In other words. to pay them separation pay Ruling: The petition has no merit. or in the alternative. Petitioners motion for reconsideration was denied in the Resolution dated 28 July 2004. or where the relationship between the employer and employee has been unduly strained by reason of their irreconcilable differences. According to petitioners. it would be more prudent to order payment of separation pay instead of reinstatement. has the option to reinstate respondents to their former positions without the payment of backwages. Marquez latter refused and insisted on their reinstatement. however. the payment of backwages as a primary relief. respondents were not entirely faultless as they did not follow the exact procedure in the performance of their duties. arguing that the 14 December 2001 Resolution granted them the right to choose between the payment of separation pay and the reinstatement of respondents based on the finding that while their termination was illegal. which directed the reinstatement of respondents pursuant to the 14 December 2001 Resolution. who are legally obliged to implement the ruling. case law developed that where reinstatement is not feasible. expedient or practical. however. The Court of Appeals affirmed the resolutions of the NLRC dated 18 June 2004 and 8 July 2004. 18 June 2004 the NLRC issued a Resolution. The NLRC recognized respondents right to choose between reinstatement and separation pay and disregarded petitioners claim of strained relations. to pay them separation pay. The NLRC Resolution dated 14 December 2001 expressly recognized respondents right to reinstatement in view of the illegality of their termination. Thus in a petitioner for certiorari before the SC. Over the years. Jefferson M. because the dispositive portion of the Resolution was directed toward or addressed to them (Johnson and Johnson). Thereafter. Petitioners also claimed that reinstatement was no longer feasible in view of the strained relations between the parties. LABOR RELATIONS Atty. which had become final and executory. or in the alternative. when it stated in its 18 June 2004 Resolution that respondents have the right to choose between their reinstatement and getting paid the monetary award when no such categorical pronouncement can be gathered from the 14 December 2001 Resolution. as the employer.

12. your employment is hereby terminated for cause effective IMMEDIATELY. Jr. separation pay. NLRC and LA is that the latter's prolonged absence was excusable. It is of record that in the February 8. 2005 Facts: Romeo Labrague (respondent) was a stevedore antigo employed with Asian Terminals. Effectively. at his last known address at Area H. the NLRC properly exercised its authority to resolve the controversy when it issued the Resolution dated 18 June 2004. where it categorically ordered the reinstatement of respondents to their former positions. the NLRC and the Court of Appeals disregarded petitioners claim that the relation between the parties was so strained that only the payment of the monetary award was feasible under the circumstances. 1996 but was advised by petitioners to file a new application so that he may be rehired.” It clearly indicates that petitioners knew early on of the situation of respondent. Jefferson M. G. dated December 27. 1995. non-payment of labor standard benefits. The following month. citing Standard Electric Mfg. vs. NLRC. damages and attorney's fees. Asian Terminal vs. in consonance with its earlier ruling. 1993. respondent failed to report for work allegedly because he was arrested and placed in detention for reasons not related to his work. Neither party can claim that it has the categorical right to choose between reinstatement and the payment of the monetary award. The NLRC upheld the continuing primacy of reinstatement as the available relief and made short shrift of petitioners avowal that separation pay should be awarded in lieu of reinstatement. the concurrent view of the CA. Petitioners argue that they were justified in dismissing respondent after the latter incurred a three-year absence without leave. It also explains why in its reply before the LA. The Court defers. December 19. more importantly. although the opposing parties yielded to the judgment of the NLRC and did not anymore elevate the labor dispute to the appellate court. through Atty. respondent reported for work on July 3. to the common finding of the NLRC and Court of Appeals since the issue of the existence of strained relations between the parties is factual in nature. Ultimately. Corvite. appeal before the NLRC and petition for certiorari before CA. Tondo. Thus. respondent filed with the NLRC a complaint for illegal dismissal. Inc. petitioners never questioned the truth about respondent's detention..R. Rodolfo G. LABOR RELATIONS Atty. Petitioners argue that respondent's prolonged absence was not justified or excused by his so-called detention. The foregoing arguments of petitioners are specious. for it was brought about by his detention for almost three years for a criminal charge that was later declared baseless. Beginning September 9.. which remained a mere allegation that was never quite substantiated by any form of official documentation. (petitioners) sent him (respondent) a letter. that his situation was known to petitioners. 158458. Marquez Petitioners are mistaken in holding that they have the prerogative to choose whether to reinstate respondents to their former positions or to just pay their monetary award. as it should. on February 8. 1994. Parola. petitioner issued a memorandum stating: For having incurred absence without official leave (AWOL) from 03 September 1993 up to the present after you were put behind bars due to your involvement in a killing incident. petitioners expressly acknowledged that respondent began incurring absences without leave “after [he was] put behind bars due to [his] involvement in a killing incident. They held that his prolonged absence was not coupled with an intention to relinquish his employment. and therefore did not constitute abandonment.Thus. Ruling: In declaring the dismissal of respondent illegal. 166111. After respondent had been absent for more than one year. G.R. since the 1980's. In the instant case. Finally. Inc. Standard Electric Employees Union. 1995 termination notice it issued. and refused to report for work despite several notices. they are now at odds as to how the 14 December 2001 Resolution should be implemented. It cannot be gainsaid that respondent was in detention during the entire period of his absence from work and. Asian Terminals. No. 2007. August 25. Following his acquittal and release from detention. No. Petitioners' skepticism about respondent's detention is a mere afterthought not proper for consideration in a petition for review under Rule 45. Manila. the NLRC has the authority to execute its judgment and to settle any issue that may arise pertaining to the manner or details of implementing its judgment. requiring him to explain within 72 hours why he should not suffer disciplinary penalty for his prolonged absence. petitioner sent respondent another notice of similar tenor. which bars reappraisal of facts Page 135 .

even after notice to return to work. since their separation from employment was founded on a false or non-existent cause. The trial court dismissed the case for “insufficiency of evidence. respondent herein was prevented from reporting for work by reason of his detention. Standard Electric Employees Union-NAFLU-KMU. We recently reiterated this ruling in Standard Electric Manufacturing Corporation v. 2008 Facts: Regina M. January 28. As a result. hence. illegal. Nevertheless. The CA. we declared such absences as not constitutive of abandonment. in that the criminal charge against him is not at all supported by sufficient evidence. for the absences he incurred by reason of his unwarranted detention did not amount to abandonment. To constitute as such. the employee must have failed to report for work or must have been absent without valid or justifiable reason. Similarly. Astorga. their employer hired substitute workers to avoid disruption of work and business operations. Abandonment is a matter of intention and cannot lightly be inferred or legally presumed from certain equivocal acts.: The facts in Pedroso v. They were released when the charges against them were not proven. In February 1998. 148142. and unanimously at that. No. two requisites must concur: first. 1997 as District Sales Manager of the Corporate Sales Marketing Group/ Fixed Services Division (CSMG/FSD). respondent Javier’s acquittal for rape makes it more compelling to view the illegality of his dismissal. LABOR RELATIONS Atty. National Labor Relations Commission as well as Pedroso v. To justify the dismissal of respondent for abandonment. It was certainly not the intention of respondent to absent himself. Absences incurred by an employee who is prevented from reporting for work due to his detention to answer some criminal charge is excusable if his detention is baseless. and unjustified refusal of the employee to resume his employment.” and such ruling is tantamount to an acquittal of the crime charged. After incarceration. and held the dismissal of the employee-detainee invalid. with the second element being the more determinative factor. that respondent performed overt acts from which it may be deduced that he no longer intended to work. Petitioners failed to discharge such burden of proof. and second. cannot be equated with abandonment. even after notice to return. petitioners should have established by concrete evidence the concurrence of two elements: first. deliberate. The petitioners therein were arrested and detained by the military authorities by virtue of a Presidential Commitment Order allegedly for the commission of Conspiracy to Commit Rebellion under Article 136 of the RPC. or his fault that he was detained on an erroneous charge. especially when we take into account that the latter incurred said absences unwillingly and without fault. Page 136 . Smart Communications v. The Labor Arbiter and the NLRC sustained the validity of their dismissal. this Court again held that the dismissed employees should be reinstated to their former positions. Respondent's absences. Respondent Javier’s absence from August 9. Moreover. they reported back to work. as the criminal charge upon which said detention was ordered was later dismissed for lack of evidence. is not tantamount to abandonment.R. correctly held that the dismissal of respondent was illegal. SMART launched an organizational realignment to achieve more efficient operations. that respondent had the intention to deliberately and without justification abandon his employment or refuse to resume his work. In no way may the absences he incurred under such circumstances be likened to abandonment. G. In Magtoto v. made the absences he incurred as a consequence thereof not only involuntary but also excusable. Jefferson M. viz. Castro are similar to the set of facts in the present case. there must have been a clear intention on the part of the employee to sever the employer-employee relationship as manifested by some overt acts. 1995 cannot be deemed as an abandonment of his work. Castro. The question is whether the CA erred in holding that such absences did not amount to abandonment as to furnish petitioners cause to dismiss respondent. Astorga (Astorga) was employed by respondent SMART on May 8. Abandonment as a just ground for dismissal requires clear. but were refused admission by their employer. 13. willful. Marquez not disputed before the lower courts or already settled in their proceedings. This was made known to the employees. and proof that respondent Javier’s arrest and detention were without factual and legal basis in the first place. Mere absence or failure to report for work. therefore. It is beyond dispute then that the underlying reason for respondent's absences was his detention. That his detention turned out to be without basis. and second.

Ruling: YES. Astorga continued reporting for work. and the dismissal was effected in accordance with the requirements of the Labor Code. thus. We believe that redundancy. Jefferson M. Issue: WON the dismissal of Astorga is valid. Succinctly put. non-payment of salaries and other benefits with prayer for moral and exemplary damages against SMART and Ann Margaret V. But on March 3. Marquez Part of the reorganization was the outsourcing of the marketing and sales force. National Labor Relations Commission. 1998. That no other person was holding the same position that private respondent held prior to termination of his services does not show that his position had not become redundant. She also posited that it was illegal for an employer. Incorporated (SNMI). Astorga’s dismissal is founded upon authorized cause. SMART responded that there was valid termination. 1998. Despite the abolition of the CSMG/FSD. effective April 3. Astorga was terminated due to redundancy. and superfluity of a position or positions may be the outcome of a number of factors. to contract out services which will displace the employees. nonetheless. LABOR RELATIONS Atty. The redundancy of Astorgas position was the result of the abolition of CSMG and the creation of a specialized and more technically equipped SNMI. Since SNMI was formed to do the sales and marketing work. and formed SMART-NTT Multimedia. Santiago (Santiago). consequently. SMART issued a memorandum advising Astorga of the termination of her employment on ground of redundancy. especially if the contractor is an in-house agency. The nature of redundancy as an authorized cause for dismissal is explained in the leading case of Wiltshire File Co. Thus. terminating her employment was illegal for it violated her right to security of tenure. which is a valid and legitimate exercise of management prerogative. she was not recommended by SMART. Astorga’s division. such as overhiring of workers. Inc.. Astorga landed last in the performance evaluation. offered her a supervisory position in the Customer Care Department. in any well organized business enterprise. a position is redundant where it is superfluous. The termination of her employment prompted Astorga to file a Complaint for illegal dismissal. SMART. Page 137 . viz: x x x redundancy in an employers personnel force necessarily or even ordinarily refers to duplication of work. it would be surprising to find duplication of work and two (2) or more people doing the work of one person. which is one of the authorized causes for the dismissal of an employee. or dropping of a particular product line or service activity previously manufactured or undertaken by the enterprise. Indeed. SMART entered into a joint venture agreement with NTT of Japan. It argued that Astorga was dismissed by reason of redundancy. SMART then conducted a performance evaluation of CSMG personnel and those who garnered the highest ratings were favorably recommended to SNMI. for purposes of the Labor Code. v. SNMI agreed to absorb the CSMG personnel who would be recommended by SMART. exists where the services of an employee are in excess of what is reasonably demanded by the actual requirements of the enterprise. 1998. She claimed that abolishing CSMG and. which is an authorized cause for termination of employment. Astorga received it on March 16. but she refused the offer because the position carried lower salary rank and rate. SMART abolished the CSMG/FSD. To soften the blow of the realignment. decreased volume of business. like SMART.

The record is clear that Astorga received the notice of termination only on March 16. but she refused the offer because the position carried a lower salary rank and rate. as aptly found by the CA. to Our mind. such as Astorga. reduce overhead costs and enhance prospects of economic gains. Indeed. By transferring the duties of CSMG/FSD to SNMI. that a violation of law or arbitrary or malicious action is not shown. Page 138 . an employer is not precluded from adopting a new policy conducive to a more economical and effective management even if it is not experiencing economic reverses. it would not have offered her a position in any department in the enterprise. The determination to outsource the duties of the CSMG/FSD to SNMI was. SMART has created a more competent and specialized organization to perform the work required for corporate accounts. we must acknowledge the prerogative of the employer to adopt such measures as will promote greater efficiency. We agree with the CA that the organizational realignment introduced by SMART. efficiently and flexibly to its customers requirement. Indeed. time and money-needed in maintaining the CSMG/FSD. properly terminable. we sustain the reorganization and redundancy program undertaken by SMART. 1998 or less than a month prior to its effectivity on April 3. However. Astorga never denied that SMART offered her a supervisory position in the Customer Care Department. In this light. no convincing evidence was offered to prove it. This Court finds it extremely difficult to believe that SMART would enter into a joint venture agreement with NTT. out of our concern for those lesser circumstanced in life. Astorga claims that the termination of her employment was illegal and tainted with bad faith. 1998. therefore. Accordingly. which culminated in the abolition of CSMG/FSD and termination of Astorgas employment was an honest effort to make SMARTs sales and marketing departments more efficient and competitive. It is also relieved SMART of all administrative costs management. Likewise. As the CA had taken pains to elucidate: x x x a careful and assiduous review of the records will yield no other conclusion than that the reorganization undertaken by SMART is for no purpose other than its declared objective as a labor and cost savings device. [Astorga] belonged to the Sales Marketing Group under the Fixed Services Division (CSMG/FSD). this Court has inclined towards the worker and upheld his cause in most of his conflicts with his employer. abolished CSMG/FSD and shortly thereafter assigned its functions to newly-created SNMI Multimedia Incorporated. This favored treatment is consonant with the social justice policy of the Constitution. 1998. Moreover. SMART failed to comply with the mandated one (1) month notice prior to termination. a distinct sales force of SMART in charge of selling SMARTs telecommunications services to the corporate market. a sound business judgment based on relevant criteria and is therefore a legitimate exercise of management prerogative. for the reason that CSMG/FSD does not have the necessary technical expertise required for the value added services. Marquez The characterization of an employees services as superfluous or no longer necessary and. of course. If indeed SMART simply wanted to get rid of her. this Court finds no fault in SMARTs decision to outsource the corporate sales market to SNMI in order to attain greater productivity. She asserts that the reorganization was done in order to get rid of her. to ensure it can respond quickly. a joint venture company of SMART and NTT of Japan. The wisdom and soundness of such characterization or decision is not subject to discretionary review provided. But except for her barefaced allegation. But while tilting the scales of justice in favor of workers. form SNMI and abolish CSMG/FSD simply for the sole purpose of easing out a particular employee. is an exercise of business judgment on the part of the employer. the Department of Labor and Employment was notified of the redundancy program only on March 6. LABOR RELATIONS Atty. Neither does the law require that the employer should suffer financial losses before he can terminate the services of the employee on the ground of redundancy. albeit always within the framework of existing laws. Jefferson M. Astorga also states that the justification advanced by SMART is not true because there was no compelling economic reason for redundancy. the fundamental law also guarantees the right of the employer to reasonable returns for his investment. But contrary to her claim. SMART.

retrenchment to prevent losses or the closing or cessation of operation of the establishment or undertaking unless the closing is for the purpose of circumventing the provisions of this Title. awarding indemnity for violation of Astorga's statutory rights. the sanction should be stiffer because the dismissal process was initiated by the employers exercise of his management prerogative. As provided in Article 283 of the Labor Code. in light of our ruling in Jaka Food Processing Corporation v. therefore. Thus. likewise.00. 283. Be that as it may. She is. Page 139 . Jefferson M. by serving a written notice on the workers and the Ministry of Labor and Employment at least one (1) month before the intended date thereof x x x. before backwages may be granted. and (2) if the dismissal is based on an authorized cause under Article 283 but the employer failed to comply with the notice requirement. as a sanction on SMART for non-compliance with the one-month mandatory notice requirement. to give them sufficient time to find other suitable employment or to make whatever arrangements are needed to cushion the impact of termination. initiated by an act imputable to the employee. this procedural infirmity would not render the termination of Astorgas employment illegal. In this case. Marquez Article 283 of the Labor Code clearly provides: Art. the employees are informed of the specific date of the termination. the sanction to be imposed upon him should be tempered because the dismissal process was. Astorgas actual knowledge of the reorganization cannot replace the formal and written notice required by the law. entitled to separation pay equivalent to at least one (1) month salary or to at least one (1) months pay for every year of service. notwithstanding Astorgas knowledge of the reorganization. However. we find the need to modify. Backwages is a relief given to an illegally dismissed employee. by increasing. LABOR RELATIONS Atty. The validity of termination can exist independently of the procedural infirmity of the dismissal. However.000. redundancy. the indemnity awarded by the CA to Astorga. a period very much shorter than that required by law. We deem it proper to increase the amount of the penalty on SMART to P50. in effect. she is not entitled to backwages. whichever is higher. The CAs award of backwages is totally inconsistent with its finding of valid dismissal. The employer may also terminate the employment of any employee due to the installation of labor saving devices. Astorga is. there must be a finding of unjust or illegal dismissal from work. viz. the award of backwages to Astorga by the CA should be deleted for lack of basis. The records show that Astorgas length of service is less than a year. In the written notice. Pacot. But such notice was received by Astorga barely two (2) weeks before the effective date of termination. SMARTs assertion that Astorga cannot complain of lack of notice because the organizational realignment was made known to all the employees as early as February 1998 fails to persuade. Since Astorgas dismissal is for an authorized cause. committed no reversible error in sustaining Astorgas dismissal and at the same time. she remained uncertain about the status of her employment until SMART gave her formal notice of termination. therefore. also entitled to separation pay equivalent to one (1) month pay.: [I]f the dismissal is based on a just cause under Article 282 but the employer failed to comply with the notice requirement. The CA. Closure of establishment and reduction of personnel. at least a month prior to the effectivity of such termination.

in turn. Respondent Luis A. Enriquez v. Enriquez was first employed by BPI in 1971 and had been an employee thereof for 32 years at the time of her termination.m. either Enriquez or Sia approved the transaction at 5:22 p. Respondents assert that the investigation conducted by the Auditing Division of BPI bolstered teller Fregils claims of irregularity as the audit report disclosed that petitioners failed to make the necessary report on the shortage and instead assisted in covering-up teller Descartins wrongdoing.00 earlier that day. to sign the withdrawal slip when the latter withdrew P36. Sia. with the signed withdrawal slip. Puentevella (Puentevella) is one of respondents principal officers and was impleaded in his personal capacity. No. Teller Descartin thereafter left the bank to secure the signature of her mother-in-law Remedios and returned at past 7:00 p.00.m. at 5:21 p. they put the matter to rest.R.00 and informed Sia about it. sometime in February 2003. was incurred because she had temporarily borrowed the money that week to pay her financial obligations but intended to return the same on the first week of January. G. Petitioner’s version of the facts: Petitioners maintain that on 27 December 2002. Sia began to wind up his affairs as 27 December 2002 was his last working day with the bank before going on terminal leave prior to his optional retirement. petitioners aver. as reflected on the account records. on 3 March 2003. Teller Fregil reported the matter to Sia and Enriquez. With that explanation. When banking hours came to a close. which she confided to her co-teller Fregil. of the BPI-Bacolod Singcang Branch. Thus. teller Descartins shortage of P36. Teller Descartin replied that her family did not have the money. According to them. 2008 Facts: Enriquez and Sia were the branch manager and assistant branch manager. whereas Sia had been with since 1974. LABOR RELATIONS Atty. At around 7:00 p. teller Geraldine Descartin (Descartin) purportedly discovered that she had a cash shortage of P36. Enriquez directed Descartin and her co-teller Evelyn Fregil (Fregil) to submit their written memorandum of the incident. or for a total of 29 years at the time of his dismissal.m. Descartin was permitted to leave the bank to look for Remedios so that the latter could sign the withdrawal slip. teller Fregil retracted her original statement and instead executed another letter claiming that there was a cover-up of the shortage on the day in question. Thus. she instead borrowed the amount from her in-laws.m. informed Enriquez of the problem and was directed to review the days transactions to trace its cause. Thus. teller Descartin posted the unsigned withdrawal slip for the amount of P36. their branch experienced a heavy volume of transactions owing to the fact that it was the last banking day of the year. Marquez 14.. both of whom suggested that teller Descartin fill the shortage with a loan from her family.000. Page 140 . she returned to the bank with the signed withdrawal slip and debited the amount from the clients account. In the meantime.000.000. respectively.00 against the joint account of her parents-in-law. February 12.. As the amount exceeded the floor limit for tellers which would require the approval of a superior officer.000. Jefferson M. BPI’s version: BPI has a different version of what transpired on 27 December 2002. Later. Descartin claimed that the discrepancy was due to an innocent oversight and recalled that the unaccounted shortage was due to the failure of her mother-in-law. respondent Puentevella initiated further investigation on the incident. Remedios Descartin (Remedios). Bank of the Philippine Islands. the transaction was regularized before the end of the day. It is the position of petitioners that as there was neither shortage nor loss to the bank because the initial discrepancy was accounted for and that it was due to a mere oversight. 172812.

since the term trust and confidence is restricted to said class of employees. failure to report a shortage is not a ground to terminate employment. On 3 September 2003. The argument is short-sighted. Furthermore. even if done in good faith. Also. Even assuming the version of petitioners as the truth. While they expressed their willingness to be interviewed. On14 July 2003. in either situation. Under the personnel policies of BPI. Moreover. Issue: Whether or not there were valid grounds for termination of employment. petitioners objected to the polygraph test. the same must be reported by the branch head to the designated bank officers and departments not later than the second banking day from the date of booking. separately interviewed petitioners and tellers Descartin and Fregil. There is no denying that loss of trust and confidence is a valid ground for termination of employment. a review of the tellers transaction summary of teller Descartin reinforces the conclusion that the shortage in her pico box was due to a temporary borrowing. Their participation in the cover-up of the misconduct of teller Descartin makes them unworthy of the trust and confidence demanded by their positions. LABOR RELATIONS Atty. it must be shown that the employee is a managerial employee. nonetheless resulted in their abetting the dishonesty committed by the latter. Moreover. The independent audit conducted by the auditing division of BPI notably supports her claim that the wrongdoing was concealed by petitioners from respondent bank. petitioners received show-cause memos directing them to explain in writing why they should not be sanctioned for conflict of interest and breach of trust. petitioners were instructed to report to the BPI head office for polygraph testing. the cover-up of which was sanctioned by petitioners. Ruling: BPI had just cause to terminate their employment. Hence. Jefferson M. BPIs policy on tellers shortages is unambiguous. The SC found sufficient basis in evidence to accord full probative value to Teller Fregils retraction letter which she later affirmed through subsequent affidavits. Page 141 . petitioners acts have caused respondents to have a legitimate reason to lose the trust reposed in them as senior managerial employees. It requires that all shortages be declared properly and booked accordingly on the same day they are incurred. Taken together with the attending circumstances of the case. a committee of respondent bank conducted a hearing of the case and as part of the investigation. Petitioners submitted their respective replies in which they denied the charges against them. the fact remains that they willfully decided against reporting the shortage that occurred. As a result. petitioners were dismissed from employment on grounds of breach of trust and confidence and dishonesty. the basic requisite for dismissal on the ground of loss of confidence is that the employee concerned holds a position of trust and confidence or is routinely charged with the care and custody of the employers money or property. It is likewise asserted by petitioners that under BPIs bank policy. On 27 June 2003. this act of petitioners justifies their dismissal even on the first offense. Marquez On 25 April 2003. the failure of petitioners to report the cash shortage of teller Descartin. the breach must be related to the performance of the employees function.

An employer cannot be expected to retain an employee whose lack of morals. disrespect in addressing superiors (3)failure to work overtime after having been instructed to do so Page 142 . 2008 Facts: Respondent was employed by petitioner R. On February 22. During his employment. respect and loyalty to his employer or regard for his employers rules and appreciation of the dignity and responsibility of his office has so plainly and completely been bared. Management also has its own rights which. Mondays to Saturdays. To be able to fulfill this duty. Michael Press as an offset machine operator. Their manifest condonation and even concealment of an offense prejudicial to their employers interest committed by a subordinate under their supervision reflect a regrettable lack of loyalty which they should have reinforced.m. instead of betrayed. whose work schedule was from 8:00 a. LABOR RELATIONS Atty. it in turn must rely on the honesty and loyalty of its employees. February 13. NOTICE OF HEARING This warning for dismissal is being issued for the following offenses: (1)habitual and excessive tardiness (2)committing acts of discourtesy. 1999. Clearly. totaling to 6. The banking industry is imbued with public interest and is mandated by law to serve its clients with extraordinary care and diligence. Jefferson M. Thus. Nicasio Galit From:ANNALENE REYES-ESCOBIA Re:WARNING FOR DISMISSAL. and to return later in the afternoon for a hearing.. as follows: To:Mr. to 5:00 p. as a measure of self-preservation against acts patently inimical to its interests. should be taken against them. respondent reported for work but petitioner Escobia told him not to work. Indeed. the fact that petitioners had been employees of BPI for a long time. in cases of this nature. Galit was tardy for a total of 190 times.m. 15. No.117 minutes. and he was paid PhP230 a day. are entitled to respect and enforcement in the interest of simple fair play. The following day. if it is to be considered at all. G. and was absent without leave for a total of nine and a half days. RB Michael Press vs. Marquez It is well-settled that the power to dismiss an employee is a recognized prerogative that is inherent in the employers right to freely manage and regulate his business. but he refused to do so. respondent was ordered to render overtime service in order to comply with a job order deadline. respondent bank had every right to dismiss petitioners for breach of trust. While the Constitution is committed to the policy of social justice and the protection of the working class. as such. to compel respondent bank to keep petitioners in its employ after the latter have betrayed the confidence given to them would be unjust to respondent bank. a copy of an Office Memorandum was served on him. 153510. When he returned.R. loss of confidence and dishonesty.B. Galit. The expectation of trust is more so magnified in the instant case in light of the nature of respondent banks business. it should not be supposed that every labor dispute will be automatically decided in favor of labor.

and discipline to come to work on time everyday exhibit the employee's deportment towards work. Further investigation of this matter is required." Hence. the management prerogative to discipline employees and impose punishment is a legal right which cannot. gave him his two-day salary and a termination letter averring that Galit was dismissed due to the following offenses: (1) habitual and excessive tardiness.. The employer. Issues: (1) WON there was just cause to terminate the employment of respondent. (SGD) ANNALENE REYES-ESCOBIA Manager On February 24. and whether due process was observed in the dismissal process. It has been ruled that "a waiver to be valid and effective must be couched in clear and unequivocal terms which leave no doubt as to the intention of a party to give up a right or benefit which legally pertains to him. You were given verbal warnings before. The mere fact that the numerous infractions of respondent have not been immediately subjected to sanctions cannot be interpreted as condonation of the offenses or waiver of the company to enforce company rules. The hearing will determine your employment status with this company. Marquez (4)Insubordination — willfully disobeying. In the case at bar. Respondent subsequently filed a complaint for illegal dismissal and money claims before the National Labor Relations Commission (NLRC). Ruling: Respondent's tardiness cannot be considered condoned by petitioners Habitual tardiness is a form of neglect of duty. as a general rule. Habitual and excessive tardiness is inimical to the general productivity and business of the employer. 1999. A waiver is a voluntary and intentional relinquishment or abandonment of a known legal right or privilege. through petitioner Escobia. defiance to. willful disobedience of. This is especially true when the tardiness and/or absenteeism occurred frequently and repeatedly within an extensive period of time. Jefferson M. Page 143 .m. diligence. defying or disregarding company authority The offenses you've committed are just causes for termination of employment as provided by the Labor Code. (2) commission of discourteous acts and disrespectful conduct when addressing superiors. (2) WON respondent is entitled to backwages and other benefits despite his refusal to be reinstated. respondent did not adduce any evidence to show waiver or condonation on the part of petitioners. Lack of initiative. that is. today. therefore. you are summoned to a hearing at 4:00 p. and (4) insubordination. respondent was terminated from employment. but there had been no improvement on your conduct. or disregard of company authority. be impliedly waived. Thus it is incumbent upon the employee to adduce substantial evidence to demonstrate condonation or waiver on the part of management to forego the exercise of its right to impose sanctions for breach of company rules. LABOR RELATIONS Atty. (3) failure to render overtime work despite instruction to do so.

the offset machine operator. In Lakpue Drug Inc. His refusal to render overtime work was the final straw that broke the camel's back. shows his wrongful and perverse mental attitude. that is. in order to avoid serious loss or damage to the employer or some other cause of similar nature. The issue now is. would merit dismissal from service. Jefferson M. Belga. 89 of the Labor Code empowers the employer to legally compel his employees to perform overtime work against their will to prevent serious loss or damage: Art. made known to the employee." The fact that respondent refused to provide overtime work despite his knowledge that there is a production deadline that needs to be met. We held in Agabon v. In the present case. installations. the employer must give the employee two written notices and a hearing or opportunity to be heard if requested by the employee before terminating the employment: a notice specifying the grounds for which dismissal is sought a hearing or an opportunity to be heard and after hearing or opportunity to be heard. Michael Press shows that he was a difficult employee. The totality of his offenses against petitioner R. Art. lawful. whether respondent's refusal or failure to render overtime work was willful. Marquez Insubordination or willful disobedience For willful disobedience to be a valid cause for dismissal. and must pertain to the duties which he had been engaged to discharge.B. there is willfulness. After a re-examination of the facts. these two elements must concur: (1) the employee's assailed conduct must have been willful. no further printing can be had. 89. characterized by a wrongful and perverse attitude. and that without him. or equipment. a notice of the decision to dismiss.EMERGENCY OVERTIME WORK Any employee may be required by the employer to perform overtime work in any of the following cases: xxx xxx xxx (c)When there is urgent work to be performed on machines. willfulness was described as "characterized by a wrongful and perverse mental attitude rendering the employee's act inconsistent with proper subordination. Petitioners maintain that they had observed due process when they gave respondent two notices and that they had even scheduled a hearing where he could have had explained his side and defended himself. we rule that respondent unjustifiably refused to render overtime work despite a valid order to do so. v. and Page 144 . that is. xxx xxx xxx In the present case. and. (1) if the dismissal is based on a just cause under Article 282. petitioners claim that they had afforded respondent due process. It is only reasonable that workers are sometimes asked to render overtime work in order to meet production deadlines. with his gross and habitual tardiness and absences. there is no question that petitioners' order for respondent to render overtime service to meet a production deadline complies with the second requisite. thus. Due process: twin notice and hearing requirement On the issue of due process. We are not persuaded. NLRC: Procedurally. and (2) the order violated must have been reasonable. LABOR RELATIONS Atty. petitioners' business is a printing press whose production schedule is sometimes flexible and varying. whether such refusal or failure was characterized by a wrongful and perverse attitude.

Calacien. 16. to prepare for his defense. he was elected by the local union as chief shop steward. Nagrama. Jr. Respondent was instructed to attend the seminar to be held on September 27-30. Respondent was designated by petitioner as waste water treatment operator effective September 27. he was not given any opportunity at all to consult a union official or lawyer. respondent was informed that charges of abandonment of duty and gross insubordination had been lodged against him. but respondent was not really given a real opportunity to defend himself. G. The hearing was immediately set in the afternoon of February 23. 1999. Therefore. to conduct training seminars to acquaint petitioner’s personnel on the operations of the water treatment plant. 1999. 1996. Anent the written notice of charges and hearing. Jefferson M. On September 17. the employees must be given two (2) notices before his employment could be terminated: (1) a first notice to apprise the employees of their fault. Isabela. He failed to attend the first two (2) days of the seminar. In a letter by his immediate supervisor. The undue haste in effecting respondent's termination shows that the termination process was a mere simulation — the required notices were given. 2008 Facts: Respondent Pablo Nagrama. Marquez (2) if the dismissal is based on authorized causes under Articles 283 and 284. it is plain to see that there was merely a general description of the claimed offenses of respondent. he is obligated to attend to the problems of his fellow union members. worse. LABOR RELATIONS Atty. 1999 — the day respondent received the first notice. He contended that he had to attend to an administrative hearing for fellow unionists which were held at Santiago. He was required to submit his written explanation. even before the first notice had been given. was initially employed by petitioner as a maintenance mechanic on June 24. Respondent filed his explanation on September 30. that before he went. and. March 4. 1993 at the Cosmos Plant in Cauayan. he first secured permission from the plant controller. Cosmos Bottling Corporation v. 1999. 1999. Isabela. Petitioner hired Clean Flow Philippines. Page 145 . and it seems that petitioners had already decided to dismiss respondent from service. Josephine D. Inc. Not to be taken lightly of course is the hearing or opportunity for the employee to defend himself personally or by counsel of his choice. the employer must give the employee and the Department of Labor and Employment written notices 30 days prior to the effectivity of his separation Under the twin notice requirement. and (2) a second notice to communicate to the employees that their employment is being terminated. He averred that as a union official. A scrutiny of the disciplinary process undertaken by petitioners leads us to conclude that they only paid lip service to the due process requirements.R. dated September 29. a hearing was even scheduled and held. No 164403.

_ftn83 There is no question that orders to attend the seminar are lawful instructions by petitioner. First.R. Moreover. The first is the failure to report for work or absence without valid or justifiable reason.ph/jurisprudence/2008/march2008/164403.C. two (2) requisites are also necessary. July 14. is lacking. there is no gross insubordination. Jefferson M. LABOR RELATIONS Atty.” to lie. Hence. he had a valid reason to attend the hearing of his union brothers. Likewise. His failure to secure a clearance from Clean Flow was due to his attendance to his union duties. also called “willful disobedience of a lawful order. the order violated must have been reasonable. Marquez Issue: Is the dismissal based on the grounds of abandonment and gross insubordination valid? Ruling: There is no abandonment and gross insubordination. No. He was a shop steward. As to the second requisite. and made known to the employee and should pertain to the duties which he has been engaged to discharge. G. The first element of gross insubordination. however. Petitioner does not contest this fact. respondent filed a complaint for illegal dismissal. Two (2) elements must be satisfied for an employee to be guilty of abandonment. which recent jurisprudence qualifies as a union officer. the assailed conduct must have been intentional and characterized by a wrongful and perverse attitude.] A complaint for illegal dismissal shows a desire to continue work. Taguiam. 2008 Facts: Page 146 . First. vs. He also asked for and was given permission as can be seen from the minutes of his hearing. The second is a clear intention to sever the employer-employee relationship. School of the Holy Spirit of Q.http://sc. lawful. The second element is the more determinative factor and must be evinced by overt acts. He immediately complied with the memo requiring him to explain his absence. His failure to report directly to his Quality Assurance Supervisor and Analyst can be dismissed as failure to properly understand the instructions he was given. 17. the burden of proof is on the employer to show the employee’s clear and deliberate intent to discontinue his employment without any intention of returning.gov.judiciary. As an officer. a review of the evidence shows that both elements of abandonment are lacking. Permission negates any possibility of respondent abandoning his job. For gross insubordination. We are not convinced that respondent intended to sever the employer-employee relationship with Cosmos. Verily. mere absence is not sufficient. A review of the records shows that respondent’s failure to report to his quality assurance supervisor and failure to fully attend the seminar was in no way tainted by a wrongful or perverse attitude. respondent’s absence was justified under the circumstances.htm . 165565. ] Second.

without justifiable excuse. we noted that a mere delay on PAL's flight schedule due to aircraft damage entails problems like hotel accommodations for its passengers. or the entire absence of care. This is not the first time that the SC have departed from the requirements laid down by the law that neglect of duties must be both gross and habitual. Before the activity started. Fuentes v. On March 10. Habitual neglect implies repeated failure to perform one's duties for a period of time. otherwise. Under Article 282 of the Labor Code. we observed that although the teller's infraction was not habitual. In this case. Gross negligence implies a want or absence of or a failure to exercise slight care or diligence. School of the Holy Spirit of Quezon City. it would be impossible for her by herself alone to keep an eye on each one of them. In view of the considerable resultant damage. as distinguished from an act done carelessly. Loss of trust and confidence to be a valid ground for dismissal must be based on a willful breach of trust and founded on clearly established facts. Otherwise stated. wrote a letter to the grade school principal requesting permission to hold a year-end celebration at the school grounds. we held that it would be unfair to compel Philippine Banking Corporation to continue employing its bank teller. Issue: Was the dismissal based on the ground as stated valid? Ruling: Yes the dismissal was valid. re-booking. knowingly and purposely. Notably. was not habitual. she should have coordinated with the school to ensure that proper safeguards. As a result of gross negligence in the present case. the sufficiency of the evidence as well as the resultant damage to the employer should be considered in the dismissal of the employee. It evinces a thoughtless disregard of consequences without exerting any effort to avoid them. Respondent admitted that she was around when Chiara Mae and her mother arrived. Jefferson M. Page 147 . Taguiam was the Class Adviser of Grade 5-Esmeralda of the petitioner. the employee would eternally remain at the mercy of the employer. thoughtlessly. depending upon the circumstances. it is undisputed that Chiara Mae's permit form was unsigned. and payment of special landing fees not to mention the soaring costs of replacing aircraft parts. Unfortunately. First . the cause is sufficient to dismiss respondent. heedlessly or inadvertently. Indeed. the possibility of law suits. When she returned. In another case. two of them sneaked out. a substantial amount of money was lost. she warned the pupils who did not know how to swim to avoid the deeper area. Nevertheless. such as adequate first aid and sufficient adult personnel. although gross. The principal authorized the activity and allowed the pupils to use the swimming pool. we ruled that Philippine Airlines (PAL) cannot be legally compelled to continue with the employment of a person admittedly guilty of gross negligence in the performance of his duties although it was his first offense. Chiara Mae drowned. Marquez Corazon P. National Labor Relations Commission. gross and habitual neglect of duties is a valid ground for an employer to terminate an employee. Respondent went after them to verify where they were going. however. respondent allowed her to join the activity because she assumed that Chiara Mae's mother has allowed her to join it by personally bringing her to the school with her packed lunch and swimsuit. In this connection. The deposit slip had already been validated prior to its loss and the amount reflected thereon is already considered as current liabilities in the bank's balance sheet. In that case. while respondent was away. Corazon P. she concluded that Chiara Mae was allowed by her mother to join the activity since her mother personally brought her to the school with her packed lunch and swimsuit. The purpose of a permit form is precisely to ensure that the parents have allowed their child to join the school activity involved. Thus. it must rest on substantial grounds and not on the employer's arbitrariness. v. In Philippine Airlines. She should have been mindful of the fact that with the number of pupils involved. Yet. Respondent had been grossly negligent. Taguiam was dismissed for gross negligence resulting to loss of confidence. petitioners lost its trust and confidence in respondent. In that case. Second. the damage went as far as claiming the life of a child. However. A breach is willful if it is done intentionally. respondent distributed the parent's/guardian's permit forms to the pupils. She could have requested the mother to sign the permit form before she left the school or at least called her up to obtain her conformity. while the pupils were swimming. LABOR RELATIONS Atty. Inc. The child was still alive when respondent rushed her to the General Malvar Hospital where she was pronounced dead on arrival. Taguiam admitted that Chiara Mae Federico's permit form was unsigned. Respondent cannot simply ignore this by resorting to assumptions. NLRC. Corazon P. it was respondent's responsibility as Class Adviser to supervise her class in all activities sanctioned by the school. respondent's negligence. 2000. whims. the maintenance man was already administering cardiopulmonary resuscitation on Chiara Mae. the class president. caprices or suspicion. were present during their activity.

G. No. 2003.300. Gross negligence implies a want or absence of or failure to exercise slight care or diligence. or the entire absence of care. USSI failed to cite particular acts or instances that would validate its claim of Morales’ poor performance. 2003.00. Universal Staffing Services Inc. therefore. Issue: Whether or not Morales is illegally dismissed Ruling: USSI insists that Morales’ dismissal was based on a valid and legal ground. Marquez It should be genuine and not simulated.A. "poor performance" is equivalent to inefficiency and incompetence in the performance of official duties. the fact that an employee's performance is found to be poor or unsatisfactory does not necessarily mean that the employee is grossly and habitually negligent of his duties. 2008 Facts: Respondent Grace M. Jefferson M. Second. illegal or unjustified. an unsatisfactory rating can be a just cause for dismissal only if it amounts to gross and habitual neglect of duties.R.). First. 18. but the NLRC and the CA reversed the Arbiter’s findings. Morales’ employment was terminated allegedly due to her poor work performance. provided for an employment term of two (2) years with a monthly salary of Dhs1. v. It evinces a thoughtless disregard of consequences without exerting any effort to avoid them. There must. As a general concept. Under Article 282 of the Labor Code. Morales received Dhs1.E. LABOR RELATIONS Atty. Claiming that she was illegally terminated. After Ten (10) months of work in Al Sandos Suites (Al Sandos) Abu Dhabi. be an actual breach of duty committed by the employee which must be established by substantial evidence. No substantial evidence was presented to substantiate the cause of Morales’ dismissal. 100. Thus. All told. Morales (Morales) applied for and was hired as receptionist by petitioner Universal Staffing Services. The Labor Arbiter lent credence to USSI’s posture and dismissed Morales’ complaint. no convincing proof was offered to substantiate Morales’ alleged poor Page 148 . and was repatriated on January 7. nor should it appear as a mere afterthought to justify earlier action taken in bad faith or a subterfuge for causes which are improper. Morales was dismissed for her alleged poor performance. It has never been intended to afford an occasion for abuse because of its subjective nature. July 21.00 as full and final settlement of all her claims on January 1. her dismissal was valid and legal. Inc. NLRC. 177576. The contract duly approved by the Philippine Overseas Employment Administration (POEA). Morales filed a complaint for illegal dismissal and non-payment of overtime and vacation pay against USSI and Al Sandos Hotel Management with the Labor Arbiter.A. (USSI) in behalf of its principal Jin Xiang International Labour Supply of United Arab Emirates (U. there being a clear showing that respondent was culpable for gross negligence resulting to loss of trust and confidence. U.E.

Morales is declared illegally dismissed. is ordered to pay Morales’ three (3) months’ salary or Dhs3. PAL adopted its so-called Plan 14 whereby PALs fleet of aircraft would be reduced from 54 to 14. it is imperative that Morales be granted the monetary benefits due her. including more than 1. PAL adopted the retrenchment scheme allegedly to cut costs and mitigate huge financial losses as a result of a downturn in the airline industry brought about by the Asian financial crisis. WHEREFORE. During said period. and the latter’s failure to discharge that burden would result in a finding that the dismissal is unjustified. or collectively known as PAL cabin crew personnel. thus requiring the services of only 654 cabin crew personnel. With this finding. 178083. the employer must send the employee who is about to be terminated. On June 15. Certainly. as well as attorney’s fees. 2008 Facts: Petitioner FASAP is the duly certified collective bargaining representative of PAL flight attendants and stewards. The only notice given to Morales was the letter dated December 14. 1998.300. are DELETED.400 of its cabin crew personnel. LABOR RELATIONS Atty.00. Flight Attendants and Steward Association of the Philippines (FASAP) v. to take effect on July 15. Respondent PAL is a domestic corporation organized and existing under the laws of the Republic of the Philippines. the petition is PARTIALLY GRANTED. There was no showing that Al Sandos warned Morales of her alleged poor performance. PAL claims that the scheme resulted in savings x x x amounting to approximately P24 million per month savings that would greatly alleviate PALs financial crisis. Page 149 . Morales was not served the first notice apprising her of the particular acts or omissions on which her dismissal was based together with the opportunity to explain her side. Morales was not accorded due process. Petitioner Universal Staffing Services. 19. Philippine Airlines. PAL retrenched 5. No. 2002 informing her that she was already terminated. No. Likewise. 178083. July 22. Jefferson M.R.000 of its employees. a written notice stating the cause/s for termination and must give the employee the opportunity to be heard and to defend himself. operating as a common carrier transporting passengers and cargo through aircraft. Under Article 277(b) of the Labor Code. PAL admits that the retrenchment is wholly premised upon such reduction in fleet.R. PAL claims to have incurred P90 billion in liabilities. there can be no other conclusion than that Morales was illegally dismissed and her employment contract was illegally terminated. In implementing the retrenchment scheme. or its peso equivalent. The principle echoed and reechoed in jurisprudence is that the onus of proving that the employee was dismissed for a just cause rests on the employer. The awards of overtime and holiday pay. G. Furthermore. while its assets stood at P85 billion. G. and to the strike staged by PAL pilots since this action also translated into a reduction of flights. Marquez performance. Grace M. Inc. 1998.

In case of termination due to the installation of labor- saving devices or redundancy. retrenchment to prevent losses or the closing or cessation of operation of the establishment or undertaking unless the closing is for the purpose of circumventing the provisions of this Title. whichever is higher. PAL claims to have recalled 820 of the retrenched cabin crew personnel. whichever is higher. To date. the Court has authorized valid reductions in the work force to forestall business losses. actual. moral and exemplary damages with a prayer to enjoin the retrenchment program then being implemented. 1998 mass dismissal of its cabin crew personnel. claims that only 80 were recalled as of January 2001. Under the Labor Code. FASAP. FASAP filed a Complaint against PAL and Patria T. Where appropriate and where conditions are in accord with law and jurisprudence. before any reduction of personnel becomes legal. Closure of establishment and reduction of personnel. LABOR RELATIONS Atty. the worker affected thereby shall be entitled to a separation pay equivalent to at least his one (1) month pay or to at least one (1) month pay for every year of service. Retrenchment is only a measure of last resort. Any claim of actual or potential business losses must satisfy certain established standards. 1998. Jefferson M. the hemorrhaging of capital. when other less drastic means have been tried and found to be inadequate. Nevertheless. by serving a written notice on the workers and the Ministry of Labor and Employment at least one (1) month before the intended date thereof. Issue: Whether PALs retrenchment scheme was justified. there must be faithful compliance with substantive and procedural requirements of the law and jurisprudence. Its failure to prove these reverses or losses necessarily means that the employees dismissal was not justified. Ruling: No. the separation pay shall be equivalent to one (1) month pay or at least one-half (1/2) month pay for every year of service. for retrenchment strikes at the very heart of the workers employment. redundancy. in November 1998 and up to March 1999 several of those retrenched were called back to service. PAL began recalling to service those it had previously retrenched.The employer may also terminate the employment of any employee due to the installation of labor-saving devices. The law recognizes the right of every business entity to reduce its work force if the same is made necessary by compelling economic factors which would endanger its existence or stability. however. Chiong (Chiong) for unfair labor practice. allowances and backwages of affected FASAP members. retrenchment or reduction of employees is authorized as follows: ART. the lifeblood upon which he and his family owe their survival. Page 150 . while it is true that the exercise of this right is a prerogative of management. illegal retrenchment with claims for reinstatement and payment of salaries. . In case of retrenchment to prevent losses and in cases of closures or cessation of operations of establishment or undertaking not due to serious business losses or financial reverses. Marquez On June 22. Thus. Meanwhile. 283. all of which must concur. months after the June 15. The burden clearly falls upon the employer to prove economic or business losses with sufficient supporting evidence. or even to recognize an obvious reduction in the volume of business which has rendered certain employees redundant. A fraction of at least six (6) months shall be considered one (1) whole year.

(3) That the employer pays the retrenched employees separation pay equivalent to one (1) month pay or at least one-half (1/2) month pay for every year of service. Jefferson M. such as cost reduction. the resolution of the instant petition hinges on a determination of the existence of the first. nor on expected losses that would have been incurred had operations been continued. or that it expected no abatement of its losses in the coming years. (4) That the employer exercises its prerogative to retrench employees in good faith for the advancement of its interest and not to defeat or circumvent the employees right to security of tenure. as well as compliance therewith by PAL. physical fitness. In view of the facts and the issues raised. are reasonably imminent as perceived objectively and in good faith by the employer. if already incurred. age. Even assuming that the employer has actually incurred losses by reason of the Asian economic crisis. it is justified only when all other less drastic means have been tried and found insufficient. Retrenchment is a means of last resort. and it did not endeavor at other measures. LABOR RELATIONS Atty. Where the only less drastic measure that the employer undertook was the rotation work scheme. whichever is higher. lesser investment on raw materials. and financial hardship for certain workers. such loss. The law speaks of serious business losses or financial reverses. and. improvement of manufacturing efficiency. the retrenchment is not completely justified if there is no showing that the retrenchment was the last recourse resorted to. the claim that retrenchment was done in Page 151 . taking to mind that the burden of proof in retrenchment cases lies with the employer in showing valid cause for dismissal: that legitimate business reasons exist to justify retrenchment. Put simply. reduction of the bonuses and salaries of both management and rank- and-file. The employer must also exhaust all other means to avoid further losses without retrenching its employees. are not merely de minimis. such as status. but substantial. (2) That the employer served written notice both to the employees and to the Department of Labor and Employment at least one month prior to the intended date of retrenchment. or if only expected. The fact that an employer may have sustained a net loss. seniority. The employer must show that its losses increased through a period of time and that the condition of the company will not likely improve in the near future. much less serious business losses within the meaning of the law. adjustment of the work routine to avoid scheduled power failure. absent any other evidence on its impact on the business. per se. fourth and the fifth elements set forth above. efficiency. may not amount to serious business losses mentioned in the law. serious. Sliding incomes or decreasing gross revenues are not necessarily losses. or the three- day-work-per-employee-per-week schedule. FIRST ELEMENT: The employers prerogative to layoff employees is subject to certain limitations. (5) That the employer used fair and reasonable criteria in ascertaining who would be dismissed and who would be retained among the employees. actual and real. not every loss incurred or expected to be incurred by a company will justify retrenchment. Marquez These are: (1) That retrenchment is reasonably necessary and likely to prevent business losses which. and trimming of marketing and advertising costs.

2003 and 2004. LABOR RELATIONS Atty. PAL should have submitted its financial statements for the years 1997 up to 1999. Marquez good faith to avoid losses is belied. must be proved by sufficient and convincing evidence. It must not be oppressive and abusive since it affects one's person and property. that it was due to its good corporate nature that the decision to consider recalling employees was made. and not for the years 2002 up to 2004 because these financial statements cover a period markedly distant to the years in question. instead of Plan 14. To prove that PAL was financially distressed. financial statements audited by independent external auditors constitute the normal method of proof of profit and loss performance of a company. it cannot be assumed that it has likewise brought PAL to the brink of bankruptcy. Likewise. and the expected imminent losses sought to be forestalled. On the requirement that the prerogative to retrench must be exercised in good faith. is that it was unfair for PAL to have made such a move. PAL submitted its audited financial statements only when the case was the subject of certiorari proceedings in the Court of Appeals by attaching in its Comment a copy of its consolidated audited financial statements for the years 2002. scheming employers might be merely feigning business losses or reverses in order to ease out employees. PAL failed to substantiate its claim of actual and imminent substantial losses which would justify the retrenchment of more than 1. it Page 152 . instead. It offered no satisfactory explanation why it abandoned Plan 14. In establishing a unilateral claim of actual or potential losses. Jefferson M. Interestingly. these are not the financial statements that would have shown PALs alleged precarious position at the time it implemented the massive retrenchment scheme in 1998. Although the Philippine economy was gravely affected by the Asian financial crisis. the fact that PAL underwent corporate rehabilitation does not automatically justify the retrenchment of its cabin crew personnel. The truth. it justified its actions of subsequently recalling to duty retrenched employees by making it appear that it was a show of good faith. Instead. we have ruled that the hiring of new employees and subsequent rehiring of retrenched employees constitute bad faith. The reason for requiring this is readily apparent: any less exacting standard of proof would render too easy the abuse of this ground for termination of services of employees. it could have submitted its audited financial statements but it failed to present the same with the Labor Arbiter. not to mention its bad faith. without the accompanying signature of a certified public accountant or audited by an independent auditor. however. which make them irrelevant and unacceptable. the right of an employer to dismiss an employee differs from and should not be confused with the manner in which such right is exercised.400 of its cabin crew personnel. FOURTH ELEMENT: Concededly. that the failure of the employer to resort to other less drastic measures than retrenchment seriously belies its claim that retrenchment was done in good faith to avoid losses. When PAL implemented Plan 22. which was what it had originally made known to its employees. however. However. In the instant case. and that the demonstrated arbitrariness in the selection of which of its employees to retrench is further proof of the illegality of the employers retrenchment program. retrenchment to prevent losses is an authorized cause for terminating employment and the decision whether to resort to such move or not is a management prerogative. it narrated a litany of woes without offering any evidence to show that they translated into specific and substantial losses that would necessitate retrenchment. Alleged losses if already realized. A Statement of Profit and Loss submitted to prove alleged losses. is nothing but a self-serving document which ought to be treated as a mere scrap of paper devoid of any probative value. it could not be said that it acted in a manner compatible with good faith. However.

fair and reasonable criteria must be used. Suspension (-20). FIFTH ELEMENT: In selecting employees to be dismissed. such as but not limited to: (a) less preferred status (e. demoted).g. considering that several thousand employees who had long been working for PAL had lost their jobs. JOB PERFORMANCE 35% Special Award +5 Commendations +2 Appreciation +1 Disciplinary Actions Reminder (-3). In sum. and yet proceeded to terminate the services of its permanent cabin crew personnel. (b) efficiency and (c) seniority. ATTENDANCE 35% Perfect Attendance +2 Missed Assignment -30 Sick Leaves in excess of allotment and other leaves in excess of allotment -20 Tardiness -10 1[93] Page 153 . we find that PAL had implemented its retrenchment program in an arbitrary manner and with evident bad faith. Appearance (-10) C. The irregularity of PALs implementation of Plan 14 becomes more apparent when it rehired 140 probationary cabin attendants whose services it had previously terminated. Jefferson M. some as new hires.. INFLIGHT PROFICIENCY EVALUATION 30% B. which prejudiced the tenurial rights of the cabin crew personnel.e. LABOR RELATIONS Atty. temporary employee). and. PAL evaluated the cabin crew personnels performance during the year preceding the retrenchment (1997). Passenger Complaints (-30). only to be recalled but assigned to lower positions (i. Warning/Admonition & Reprimands (-5). based on the following set of criteria or rating variables found in the Performance Evaluation Form of the cabin crew personnels Grooming and Appearance Handbook: A. worse.. Marquez was capricious and arbitrary. without due regard for their long years of service with the airline. In the implementation of its retrenchment scheme.

It failed to take into account each cabin attendants respective service record. 87956 dated August 23. Number of employees who were retrenched due to other reasons -.473. PALs retrenchment program is illegal because it was based on wrongful premise (Plan 14. LABOR RELATIONS Atty. SP No. 2006. and that the criteria actually used which was unilaterally formulated by PAL using its Performance Evaluation Form in its Grooming and Appearance Handbook was reasonable and fair.107 5. This makes the evaluation of each cabin attendants efficiency rating capricious and prejudicial to PAL employees covered by it. Number of employees retrenched due to inverse seniority rule and other reasons -. and treated all cabin attendants as if they were on equal footing.1. PAL only considered the year 1997. Indeed. Jefferson M. however. Moreover. It found the following: 1. thereby disregarding seniority and loyalty in the evaluation of overall employee performance. DISPOSITION: WHEREFORE. Number of employees retrenched due to excess sick leaves -. Indeed. the criteria utilized by PAL in the actual retrenchment were not reasonable and fair. This is not allowed because it has no basis in fact and in law. By discarding the cabin crew personnels previous years of service and taking into consideration only one years worth of job performance for evaluation. FINDING respondent Philippine Airlines. PAL virtually did away with the concept of seniority.454 2. Page 154 .61 4.4 Prominent from the above data is the retrenchment of cabin crew personnel due to other reasons which. with no one more senior than the other. PAL was not obligated to consult FASAP regarding the standards it would use in evaluating the performance of the each cabin crew. In sum. Marquez The appellate court held that there was no need for PAL to consult with FASAP regarding standards or criteria that the airline would utilize in the implementation of the retrenchment program. Inc. which affirmed the Decision of the NLRC setting aside the Labor Arbiters findings of illegal retrenchment and its Resolution of May 29. Number of employees who were retrenched due to excess sick leave and other reasons -. However.552 Total -.299 3. loyalty and past efficiency. the NLRC made a detailed listing of the retrenchment scheme based on the ICCD Masterank and Seniority 1997 Ratings. the instant petition is GRANTED. 2007 denying the motion for reconsideration. are REVERSED and SET ASIDE and a new one is rendered: 1. in assessing the overall performance of each cabin crew personnel.R. The assailed Decision of the Court of Appeals in CA-G. which in reality turned out to be Plan 22. resulting in retrenchment of more cabin attendants than was necessary) and in a set of criteria or rating variables that is unfair and unreasonable when implemented. Number of employees who were demoted -. GUILTY of illegal dismissal. are not specifically stated and shown to be for a valid cause.

Where reinstatement is no longer feasible because the positions previously held no longer exist. No. The labor arbiter. Inc. JHLIC’s corporate affairs manager. Hence. the complaint was dismissed for lack of merit. 2002. CA on July 4. discovered that her wallet was missing. On October 18. Petitioner moved for reconsideration but it was denied. Thus. vs. inclusive of allowances and other monetary benefits computed from the time of their separation up to the time of their actual reinstatement. The labor arbiter and NLRC should have assessed evidence independently as "unsubstantiated suspicions. found that Davis committed serious misconduct (she was the principal suspect for qualified theft committed inside petitioner's office during work hours). to reinstate the cabin crew personnel who were covered by the retrenchment and demotion scheme of June 15. Costs against respondent PAL. this petition where petitioner argues that the ground for an employee's dismissal need only be proven by substantial evidence. Because the affidavits of the witnesses were not verified. The NBI. Upon petition for certiorari filed with the CA. Sept. 2003 and denied her motion for reconsideration in October 30. Meanwhile. Because loss of personal property among its employees had become rampant in its office. ORDERING Philippine Airlines. 2008 Facts: Joanna Cantre Davis was agency administration officer of John Hancock Life Insurance Corporation. NLRC affirmed the labor arbiter in July 31. separation pay equal to one (1) month pay for every year of service. provided that with respect to those who had received their respective separation pay. in lieu of reinstatement. Davis filed a complaint for illegal dismissal alleging that petitioner terminated her employment without cause. and to pay them full backwages. to pay attorneys fees equivalent to ten percent (10%) of the total monetary award. She immediately reported the loss of her credit cards to AIG and BPI Express. petitioner placed Davis under preventive suspension and instructed her to cooperate with its ongoing investigation. the dropping of charges against an employee (especially on a technicality such as lack of proper verification) or his subsequent acquittal does not preclude an employer from dismissing him due to serious misconduct.R. Issue: Whether or not petitioner substantially proved the presence of valid cause for respondent's termination. 3. 1998 made effective on July 15. There was a valid cause for her dismissal. they did not constitute substantial evidence. respondent Corporation shall pay backwages plus. ORDERING Philippine Air Lines. 2003. she was informed that "Patricia Yuseco" had just made substantial purchases using her credit cards in various stores in the City of Manila. 2005 granted the petition holding that the labor arbiter and NLRC merely adopted the findings of the NBI regarding respondent's culpability. 169549. in May 21. Thus. Page 155 . Yuseco and other witnesses positively identified the person in the video as Davis NBI and Yuseco filed a complaint for qualified theft against Davis but because the affidavits presented by the NBI (identifying respondent as the culprit) were not properly verified. petitioner sought the assistance of NBI. accusations and conclusions of employers (did) not provide legal justification for dismissing an employee". LABOR RELATIONS Atty. Patricia Yuseco. without loss of seniority rights and other privileges. 20. 2000. 1998. Inc. Davis. John Hancock Life Insurance Corp. To her surprise. G. Marquez 2. obtained a security video from Abenson's showing the person who used Yuseco's credit cards. Jefferson M. the city prosecutor dismissed the complaint due to insufficiency of evidence. 3. the amounts of payments shall be deducted from their backwages. Upon appeal. She was also told that a proposed transaction in Abenson's-Robinsons Place was disapproved because "she" gave the wrong information upon verification.

In his letter. Upon audit of the October 28. Nonetheless. and implies wrongful intent and not mere error in judgment". a dereliction of duty. The labor arbiter and the NLRC relied not only on the affidavits of the NBI's witnesses but also on that of respondent. As a background. respondent said that the erroneous Page 156 . she could not be dismissed for serious misconduct.R. Article 282 (e) of the Labor Code talks of other analogous causes or those which are susceptible of comparison to another in general or in specific detail. (e) Other causes analogous to the foregoing. petitioner dismissed Davis based on the NBI's finding that the latter stole and used Yuseco's credit cards. this report indicates the ticket opening and closing for the particular day of duty. Did petitioner substantially prove the existence of valid cause for respondent's separation? Yes. the company issues an "Irregularity Report" against the employee. In this case. 2001 Conductor's Report of respondent. — An employer may terminate an employment for any of the following causes: (a) Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or his representatives in connection with his work. They likewise considered petitioner's own investigative findings. is a cause analogous to serious misconduct. KKTI nevertheless asked respondent to explain the discrepancy. A cause analogous to serious misconduct is a voluntary and/or willful act or omission attesting to an employee's moral depravity. 1999. forbidden act. G. KKTI noted an irregularity. After submission. Merin vs. 171790. Marquez Ruling: Supreme Court granted the petition and ruled that petitioner validly dismissed Davis for cause analogous to serious misconduct. No. Respondent was required to accomplish a "Conductor's Trip Report" and submit it to the company after each trip. the concerned employee is asked to explain the incident by making a written statement or counter-affidavit at the back of the same Irregularity Report. 2001 incident. the company then makes a determination of whether to accept the explanation or impose upon the employee a penalty for committing an infraction. That decision shall be stated on said Irregularity Report and will be furnished to the employee. But since the theft was not committed against petitioner itself but against one of its employees. the cause must involve a voluntary and/or willful act or omission of the employee. the company audits the reports. if proven by substantial evidence. For misconduct to be serious and therefore a valid ground for dismissal. It discovered that respondent declared several sold tickets as returned tickets causing KKTI to lose an income of eight hundred and ninety pesos. willful in character. While no irregularity report was prepared on the October 28. Misconduct involves "the transgression of some established and definite rule of action. indicating the nature and details of the irregularity. it must be: of grave and aggravated character and not merely trivial or unimportant and connected with the work of the employee. LABOR RELATIONS Atty. Theft committed by an employee against a person other than his employer. they did not merely adopt the findings of the NBI but independently assessed evidence presented by the parties. Thereafter. Clearly. After considering the explanation of the employee. Article 282 of the Labor Code provides: Termination by Employer. respondent's misconduct was not work-related and therefore. 2008 Facts: Respondent Mamac was hired as bus conductor of Don Mariano Transit Corporation (DMTC) on April 29. 21. NLRC. October 17. Jefferson M. Once an irregularity is discovered. Their conclusion (that there was valid cause for respondent's separation from employment) was therefore supported by substantial evidence. For an employee to be validly dismissed for a cause analogous to those enumerated in Article 282.

It claimed that respondent had violated the trust and confidence reposed upon him by KKTI. respondent received a letter terminating his employment effective November 29. . The dismissal letter alleged that the October 28. . he claimed that his dismissal was effected without due process. Marquez declaration in his October 28. nonpayment of 13th-month pay. 2001 Trip Report was unintentional. the windshield of the bus assigned to them was smashed. 277 of the Labor Code provides the manner of termination of employment. service incentive leave. Non-compliance with the Due Process Requirements Art. Miscellaneous Provisions. Ruling: Due process under the Labor Code involves two aspects: first. Jefferson M. 2001 irregularity was an act of fraud against the company. the employer shall furnish the worker whose employment is sought to be terminated a written notice containing a statement of the causes for termination and shall afford the latter ample opportunity to be heard and to defend himself with the assistance of his representative if he so desires in accordance with company rules and regulations promulgated pursuant to guidelines set by the Department of Labor and Employment. and separation pay. (b)Subject to the constitutional right of workers to security of tenure and their right to be protected against dismissal except for a just and authorized cause without prejudice to the requirement of notice under Article 283 of this Code. 2001. 277. On November 26. substantive — the valid and authorized causes of termination of employment under the Labor Code. procedural — the manner of dismissal. KKTI contended that respondent was legally dismissed after his commission of a series of misconducts and misdeeds. he got confused in making the trip report. As a result of the incident. Also. it averred that it had observed due process in dismissing respondent and maintained that respondent was not entitled to his money claims such as service incentive leave and 13th-month pay because he was paid on commission or percentage basis. thus: Art. — . Issue: Whether or not procedural requirements were complied with. Moreover. He denied committing any infraction and alleged that his dismissal was intended to bust union activities. and they had to cut short the trip in order to immediately report the matter to the police. illegal deductions. and second. He explained that during that day's trip. Respondent filed a Complaint for illegal dismissal. Page 157 . 2001. The burden of proving that the termination was for a valid or authorized cause shall rest on the employer. LABOR RELATIONS Atty. KKTI also cited as basis for respondent's dismissal the other offenses he allegedly committed since 1999. Any decision taken by the employer shall be without prejudice to the right of the worker to contest the validity or legality of his dismissal by filing a complaint with the regional branch of the National Labor Relations Commission.

(2) present evidence in support of their defenses." However. the notice should contain a detailed narration of the facts and circumstances that will serve as basis for the charge against the employees. the foregoing notices shall be served on the employee's last known address. with the assistance of a representative or counsel of their choice. the implementing rule of the aforesaid provision states: SEC. 282 is being charged against the employees. To clarify. consult a union official or lawyer. this conference or hearing could be used by the parties as an opportunity to come to an amicable settlement. This should be construed as a period of at least five (5) calendar days from receipt of the notice to give the employees an opportunity to study the accusation against them. and a directive that the employees are given the opportunity to submit their written explanation within a reasonable period. Lastly. or rebut the evidence presented against him. requirements of notice. it maintains that it had substantially complied with the rules. the employees are given the chance to defend themselves personally. the notice should specifically mention which company rules. A general description of the charge will not suffice. 2. the following standards of due process shall be substantially observed: I. indicating that upon due consideration of all the circumstances. with the assistance of counsel if he so desires is given opportunity to respond to the charge. and decide on the defenses they will raise against the complaint. (3)After determining that termination of employment is justified. "Reasonable opportunity" under the Omnibus Rules means every kind of assistance that management must accord to the employees to enable them to prepare adequately for their defense. gather data and evidence. and giving said employee reasonable opportunity within which to explain his side. Marquez Accordingly. the employers shall serve the employees a written notice of termination indicating that: (1) all circumstances involving the charge against the employees have been considered. and (2) grounds have been established to justify the severance of their employment. present his evidence. — In all cases of termination of employment. In the instant case." Page 158 . LABOR RELATIONS Atty. and (3) rebut the evidence presented against them by the management. (b)A hearing or conference during which the employee concerned. the following should be considered in terminating the services of employees: (1)The first written notice to be served on the employees should contain the specific causes or grounds for termination against them. KKTI admits that it had failed to provide respondent with a "charge sheet.Standards of due process. During the hearing or conference. (c)A written notice of termination served on the employee.For termination of employment based on just causes as defined in Article 282 of the Code: (a)A written notice served on the employee specifying the ground or grounds for termination. Moreover. Jefferson M. are violated and/or which among the grounds under Art. Moreover. if any. in order to enable the employees to intelligently prepare their explanation and defenses. (2)After serving the first notice. claiming that "respondent would not have issued a written explanation had he not been informed of the charges against him. grounds have been established to justify his termination. the employers should schedule and conduct a hearing or conference wherein the employees will be given the opportunity to: (1) explain and clarify their defenses to the charge against them. In case of termination.

First. 2008 Facts: Armando G. NLRC. 215lb. 212lb. “and considering the utmost leniency” extended to him “which spanned a period covering a total of almost five (5) years. During that period he was requested to lose weight and to report for weight checks which he constantly failed to do. Inc. LABOR RELATIONS Atty.000) as damages. Second. Jefferson M. 17. 22. Likewise. He met the required weight and was allowed to work but his weight problem recurred. The reports did not even state a company rule or policy that the employee had allegedly violated. the ideal weight being 166 pounds. Third. However. Thus. In Pepsi Cola Bottling Co. Sanction for Non-compliance with Due Process Requirements As stated earlier. His weight problem dates back to 1984 when PAL advised him to go on an extended vacation leave from December 29. The NLRC affirmed the LA. and 205. v. 168081. 282 of the Labor Code. The CA reversed the NLRC. A verbal appraisal of the charges against an employee does not comply with the first notice requirement.R. Phil Airlines. For failure to meet the weight standards another leave without pay from March 5. Yrasuegui vs. In the meantime his status was “off-duty. NLRC. He was unaware that a dismissal proceeding was already being effected. Regardless of respondent's written explanation. Marquez We are not convinced. 1985 to November 1985 was imposed. the Court observed the irregularity reports against respondent for his other offenses that such contained merely a general description of the charges against him. the employer should indemnify the employee with nominal damages. (PAL). Page 159 .” his services were considered terminated “effective immediately. No. no hearing was conducted. respondent made the letter merely to explain the circumstances relating to the irregularity. the CA awarded full backwages in favor of respondent in accordance with the doctrine in Serrano v. thus another leave without pay from October 17. for non-compliance with the due process requirements in the termination of respondent's employment. after a finding that petitioners failed to comply with the due process requirements. 1985 to address his weight concerns.” Finally in 1993. petitioner KKTI is sanctioned to pay respondent the amount of thirty thousand pesos (PhP30. The proper weight for a man of his height and body structure is from 147 to 166 pounds. the Court held that consultations or conferences are not a substitute for the actual observance of notice and hearing. From 1989 to 1992 his weight fluctuated from 209lb. Thus. Yrasuegui was a former international flight steward of Philippine Airlines. The law is clear on the matter. respondent was not issued a written notice charging him of committing an infraction. the doctrine in Serrano had already been abandoned in Agabon v. petitioner was formally informed by PAL that due to his inability to attain his ideal weight. Moreover. KKTI's "standard" charge sheet is not sufficient notice to the employee. The Labor Arbiter ruled that he was illegally dismissed and entitles to reinstatement. Oct. backwages and attorney’s fees. G. 217lb. as mandated by the Cabin and Crew Administration Manual of PAL. there is no mention of any of the grounds for termination of employment under Art. He stands five feet and eight inches (5’8”) with a large body frame. a hearing was still necessary in order for him to clarify and present evidence in support of his defense. 1984 to March 4. NLRC by ruling that if the dismissal is done without due process. 1988 to February 1989.” He then filed a complaint for illegal dismissal against PAL.

Jefferson M. religion. they were the “prescribed weights” that a cabin crew must maintain in order to qualify for and keep his or her position in the company. Passenger safety goes to the core of the job of a cabin attendant. when placed in the context of his work as flight attendant. or national origin is an actual qualification for performing the job. Truly. in an emergency situation. these “qualifying standards” are norms that apply prior to and after an employee is hired. Aircrafts have constricted cabin space. the agility to attend to passengers in cramped working conditions. In other words. x x x We hold that the obesity of petitioner. not minutes. On board an aircraft. an employee may be dismissed the moment he is unable to comply with his ideal weight as prescribed by the weight standards. a legally dismissed employee is not entitled to separation pay. … The failure to meet the employer’s qualifying standards is in fact a ground that does not squarely fall under grounds (a) to (d) and is therefore one that falls under Article 282(e) – the “other causes analogous to the foregoing. The dismissal of petitioner can be predicated on the bona fide occupational qualification defense. A common carrier. Ruling: The obesity of petitioner is a ground for dismissal under Article 282(e) of the Labor Code. and the stamina to withstand grueling flight schedules. Being overweight necessarily impedes mobility. The weight standards of PAL constitute a continuing qualification of an employee in order to keep the job. Employment in particular jobs may not be limited to persons of a particular sex. As explained by the CA: x x x [T]he standards violated in this case were not mere “orders” of the employer. from the nature of its business and for reasons of public policy. The job of a cabin attendant during emergencies is to speedily get the passengers out of the aircraft safely. His obesity may not be unintended. The primary objective of PAL in the imposition of the weight standards for cabin crew is flight safety. or national origin unless the employer can show that sex. The task of a cabin crew or flight attendant is not limited to serving meals or attending to the whims and caprices of the passengers. Petitioner is entitled to separation pay.” must fail.” By its nature. religion. II. and that the weight standards “has nothing to do with airworthiness of respondent’s airlines. but is nonetheless voluntary. This may be deduced from the Page 160 . Three lost seconds can translate into three lost lives. Marquez Issue: Whether or not petitioner was illegally dismissed. LABOR RELATIONS Atty. seconds are what cabin attendants are dealing with. they were standards that establish continuing qualifications for an employee’s position. it is only logical to hold that the weight standards of PAL show its effort to comply with the exacting obligations imposed upon it by law by virtue of being a common carrier. Thus. Tersely put. the body weight and size of a cabin attendant are important factors to consider in case of emergency. airlines need cabin attendants who have the necessary strength to open emergency doors. Thus. is bound to observe extraordinary diligence for the safety of the passengers it transports. the arguments of respondent that “[w]hether the airline’s flight attendants are overweight or not has no direct relation to its mission of transporting passengers to their destination”. The qualification is called a bona fide occupational qualification (BFOQ). Evacuation might slow down just because a wide-bodied cabin attendant is blocking the narrow aisles. The most important activity of the cabin crew is to care for the safety of passengers and the evacuation of the aircraft when an emergency occurs. Normally. The dismissal would fall under Article 282(e) of the Labor Code. and narrow aisles and exit doors. Indeed. becomes an analogous cause under Article 282(e) of the Labor Code that justifies his dismissal from the service.

2001. however.335 kilos of squid heads worth P50. G. 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. He also alleged that the squid heads were already “scraps” as these were not intended for cooking. he could have stolen other valuable items instead of scrap. was not allowed to retire with his honor intact. Exceptionally. it is required that the dismissal (1) was not for serious misconduct.” In both instances. Labor Arbiter Pati dismissed the complaint. At that time. Jefferson M. Marquez language of Article 279 of the Labor Code that “[a]n employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages. Here. According to the Labor Arbiter. inclusive of allowances. petitioner conveyed to respondent his intention of retiring. Neither were the squid heads served to customers. During the inquest proceedings for qualified theft before Assistant Prosecutor Pineda. 2008 Facts: Petitioner Julito Sagales was employed by respondent Rustan’s Commercial Corporation occupying the position of Chief Cook at the Yum Yum Tree Coffee Shop from October 1970 until July 26. petitioner contended that although he was in possession of the plastic bag containing the squid heads. The only fault he committed was his failure to immediately show the purchase receipt when he was accosted because he misplaced it when he changed his clothes. We grant petitioner separation pay equivalent to one-half (1/2) month’s pay for every year of service. After receiving his latest award. Thus. On June 18. Pineda believed the version of petitioner and recommended the dismissal of the case for “lack of evidence. 2001. Respondent did not find merit in the explanation of petitioner. Security Guard Magtangob apprehended petitioner in the act of taking out from Rustan’s Supermarket a plastic bag containing 1. 2001. If he intended to steal from respondent. He was also receiving service charge of not less than P3. LABOR RELATIONS Atty. petitioner was dismissed from service on July 26.000. he did not steal them because he actually paid for them. No. attorney’s fees.880. It should include regular allowances which he might have been receiving.00. petitioner had been under preventive suspension for 1 month. He bought the squid heads so that they could be eaten instead of being thrown away. 23. 166554. and (2) does not reflect on the moral character of the employee. 2001. Aggrieved.” Per the evidence presented by respondent. and service charges. this is not an ironclad rule.” A formal investigation was conducted by the Legal Department on July 6. the nature of the responsibility of petitioner “was not that of an ordinary employee. after reaching 31 years in service. He also prayed for unpaid salaries/wages. Petitioner. it behooved him “to be more knowledgeable if not the most knowledgeable in company policies on employee purchases of food scrap items in the kitchen. Thus. Petitioner was not able to show any receipt when confronted.00 a month and other benefits under the law. petitioner presented a receipt. Page 161 .” or based on “equity. Petitioner was also a consistent recipient of numerous citations for his performance. Petitioner was later ordered released pending further investigation but respondent placed petitioner under preventive suspension.” It then went on to categorize petitioner as a supervisor in “a position of responsibility where trust and confidence is inherently infused.” Luckily for petitioner. when he was terminated. as well as moral and exemplary damages. November 27.” As such. separation pay is granted to a legally dismissed employee as an act “social justice. As proof.R. Sagales v. petitioner was brought to the Makati Police Criminal Investigation Division where he was detained. overtime pay. petitioner filed a complaint for illegal dismissal against respondent.00. petitioner breached company policy which justified his dismissal. He was paid a basic monthly salary of P9. Rustans Commercial Corporation.

however. The same holds true for supervisory employees occupying positions of responsibility. he was “Chief Cook. and inspects galley and equipment for cleanliness and proper storage and preparation of food.” Petitioner left with no other recourse. Naturally. Ruling: I. as he would still be covered by the trust and confidence rule. The CA also held that the evidence presented by respondent clearly established loss of trust and confidence on petitioner. The position of petitioner is supervisory in nature which is covered by the trust and confidence rule. However. in the interest of the employer. a chief cook falls under the definition of a supervisor. (3) WON the penalty of dismissal is proper.00 worth of squid heads. The nature of the job of an employee becomes relevant in termination of employment by the employer because the rules on termination of managerial and supervisory employees are different from those on the rank-and-file. refused to award separation pay in his favor. The NLRC did not believe that petitioner would trade off almost 31 years of service for P50. Page 162 . According to the CA. (2) WON the evidence on record sufficient to conclude that petitioner committed the crime charged. It has not escaped Our attention that petitioner changed his stance as far as his actual position is concerned. The NLRC held that the petitioner is a mere rank-and-file employee. in his memorandum.. and thus are bound by more exacting work ethics. he now claimed that he was an “Asst. he alleged that at the time of his dismissal. Cook. the CA. Respondent brought the matter to the CA. Marquez On appeal. “the award of separation pay cannot be sustained under the social justice theory” because the instant case “involves theft of the employer’s property. one who. As a consequence. Managerial employees are tasked to perform key and sensitive functions. determines timing and sequence of operations required to meet serving times. Jefferson M. In his position paper. the claim for damages was denied for lack of evidence. In reversing the NLRC. LABOR RELATIONS Atty.e. help petitioner. NLRC reversed the decision of the Labor Arbiter. There is no doubt that the position of petitioner as chief cook is supervisory in nature. availed of the present remedy.”[46] However.” The ploy is clearly aimed at giving the impression that petitioner is merely a rank-and-file employee. managerial employees are covered by the trust and confidence rule. The change in nomenclature does not. Lastly. the CA opined that the position of petitioner was supervisory in nature. i. The evidence is also wanting that petitioner committed the crime charged. Issue:S: (1) WON petitioner’s position is supervisory in nature which is covered by the trust and confidence rule. effectively recommends managerial actions which would require the use of independent judgment and is not merely routinary or clerical. Hence. petitioner was illegally dismissed as respondent failed to establish a just cause for dismissal. A chief cook directs and participates in the preparation and serving of meals. although taking note of the long years of service of petitioner and his numerous awards.

Jefferson M. as it is the policy of the State to guarantee the right of every worker to security of tenure as an act of social justice. The reason for this is that labor is deemed to be “property” within the meaning of constitutional guarantees. Security of tenure is a paramount right of every employee that is held sacred by the Constitution. Marquez Of course. store manager of petitioner corporation who is in charge of all personnel. respondent has discharged its onus of proving that petitioner committed the crime charged. the ruling assumes greater significance if petitioner is the chief cook. petitioner presents as evidence the verified statement of security guard Aranas. In the case at bar. cashier of petitioner corporation’s supermarket. We quote with approval the observation of the CA in this regard: On this matter. Further.” Necessarily then. Ang malawak ay laging sumasakop sa maliit. It is well settled that the conviction of an employee in a criminal case is not indispensable to the exercise of the employer’s disciplinary authority. such right should not be denied on mere speculation of any similar or unclear nebulous basis. II. that the employee concerned is responsible for the misconduct and that his participation in the misconduct rendered him absolutely unworthy of trust and confidence. the right of every employee to security of tenure is all the more secured by the Labor Code by providing that “the employer shall not terminate the services of an employee except for a just cause or when authorized” by law. The evidence on record is sufficient to conclude that petitioner committed the crime charged. including employees of the Yum Yum Tree Coffee Shop of which private respondent was a former assistant cook. We stress that the quantum of proof required for the application of the loss of trust and confidence rule is not proof beyond reasonable doubt. if not to entertain the moral conviction. attested to the fact of private respondent seeking apology for the commission of the act. the employer bears the burden of proof to show the basis of the termination of the employee. Ayala Center. A chief cook naturally performs greater functions and has more responsibilities than an assistant cook. to believe. the verified statement of Samson. Likewise.00)per kilo. It is sufficient that there must only be some basis for the loss of trust and confidence or that there is reasonable ground to believe. 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.335 kilos of squid heads amounting to fifty pesos (P50. Indeed. Page 163 . In eo quod plus sit simper inest et minimus. had not been paid for. Worth noting is the fact that petitioner failed to impute any ill will or motive on the part of the witnesses against him. if not impossible. Makati City. The contention of petitioner that respondent merely imputed the crime against him because he was set to retire is difficult. Makati Branch. Indeed. the statement of security guard Magtangob attested to the commission by private respondent of the offense charged. Otherwise. It is also of no moment that the criminal complaint for qualified theft against petitioner was dismissed. the statement of Zenaida Castro (Castro). Aranas positively saw the private in the act of bringing out the purloined squid heads. The greater always includes the less. confirmed that indeed the 1. LABOR RELATIONS Atty. an employee who is illegally dismissed “shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages. Similarly. inclusive of allowances.

Thus. NLRC. considering that he would have been retired by now.R. petitioner deserves compassion more than condemnation. (4) the value of the squid heads worth P50. citing Genuino vs. PAL. (2) his tireless and faithful service is attested by the numerous awards he has received from respondent. 24. 2007 Facts: This case stemmed from an administrative charge filed by PAL against employees. conduct or omission imputed to the employee and must be imposed in connection with the disciplinary authority of the employer. 2001 was his first offense in his long years of service. it is but proper to award petitioner separation pay computed at one-month salary for every year of service. however momentary. In the case at bar. Truly. the period where backwages are awarded must be included. Whether a subsequent finding of a valid dismissal by NLRC removes the basis for implementing the reinstatement aspect of the Labor Arbiter’s decision? 2. (5) respondent practically did not lose anything as the squid heads were considered scrap goods and usually thrown away in the wastebasket. After due notice. No. In the computation of separation pay.R. in lieu of reinstatement. while the employer has the inherent right to discipline. G. Whether respondent company is justified in refusing to comply with such reinstatement order in view of its corporate rehabilitation? Page 164 . From the Labor Arbiter. it is undisputed that: (1) petitioner has worked for respondent for almost thirty-one (31) years. Subsequently. it would be useless to order the reinstatement of petitioner. The penalty must be commensurate with the act. PAL dismissed petitioners prompting the latter to file a complaint for illegal dismissal which was resolved by the Labor Arbiter in their favor ordering inter alia their reinstatement. G. In any case. (6) the ignominy and shame undergone by petitioner in being imprisoned. petitioner has more than paid his due. Truly. Marquez III. respondent appealed to NLRC which reversed said decision. herein petitioners after allegedly being caught in the act of sniffing shabu in the workplace. Garcia vs. including that of dismissing its employees.00 is negligible. is punishment in itself. it is a hornbook doctrine that infractions committed by an employee should merit only the corresponding penalty demanded by the circumstance. At the end of the day. Jan. 20. 164856. Jefferson M. In this regard. respondent company was placed under corporate rehabilitation. 2009. 142732-33. Later. The only condition is that the exercise of management prerogatives should not be done in bad faith or with abuse of discretion. a fraction of at least six (6) months considered as one whole year. Issues: 1. this prerogative is subject to the regulation by the State in the exercise of its police power. a writ of execution as regards the reinstatement was issued by the Labor Arbiter. En Banc. and (7) petitioner was preventively suspended for one month. The penalty of dismissal is too harsh under the circumstances. No. which is already a commensurate punishment for the infraction committed. (3) the incident on June 18. The free will of management to conduct its own business affairs to achieve its purpose cannot be denied. LABOR RELATIONS Atty. December 4. Respondent then filed an urgent petition for injunction on the ground that it cannot comply with the reinstatement order due to its corporate rehabilitation.

Page 165 . Respondent’s failure to exercise the alternative options of actual reinstatement and payroll reinstatement was thus justified. and her dismissal is based on a just cause. The legislative intent is quite obvious i. Case law recognizes that unless there is a restraining order. The new NLRC Rules of Procedure which took effect on Jan. The petition is denied. 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. to make an award of reinstatement immediately enforceable. the employer may still be required to pay the salaries notwithstanding the reversal of the labor arbiter’s decision. After the labor arbiter’s decision is reversed by a higher court. then she is not entitled to be paid the salaries xxx. 2006 now require the employer to submit a report of compliance within 10 calendar days from receipt of the labor arbiter’s decision. making it difficult to establish that the employer actually refused to comply. If the delay is due to employer’s unjustified refusal. 223 is clear that an award by the Labor Arbiter for reinstatement shall be immediately executory even pending appeal and the posting of a bond by the employer shall not stay the execution for reinstatement. would necessarily have to use up the salaries received during the pendency of the appeal. The opposite view is articulated in Genuino vs NLRC which states: “If the decision of the Labor Arbiter is later reversed on appeal upon the finding that the ground for dismissal is valid. Jefferson M. The Court reaffirms such prevailing principle that even if the order of reinstatement is reversed on appeal. The test is two-fold: a) there must be actual delay or the fact that the order of reinstatement pending appeal was not executed prior to its reversal and b) the delay must not be due to the employer’s unjustified act or omission. the “Refund Doctrine” easily demonstrates how a favorable decision by the Labor Arbiter could harm more than help a dismissed employee. The employee. Pursuant to police power. all actions for claims before any tribunal against the corporation shall ipso jure be suspended. then the employer has the right to require the dismissed employee on payroll reinstatement to refund the salaries he or she received while the case was pending appeal. In Genuino. even pending appeal. It is settled that upon appointment by SEC of a rehabilitation receiver. The employee need not file a motion for the issuance of a writ of execution since the labor arbiter shall thereafter motu proprio issues the writ. jurisprudential trend has maintained that even if the order of reinstatement of the Labor Arbiter is reversed on appeal. The CA decision annulling the NLRC resolutions affirming the validity of the Writ of Execution and Notice of Garnishment is affirmed. to make both ends meet.e. Thus. pending appeal of a decision reinstating a dismissed or separated employee since that saving act is designed to stop.” However. the implementation of the order of reinstatement is ministerial and mandatory. xxx. the employee may be barred from collecting the accrued wages if it is shown that the delay in enforcing the reinstatement was without fault of the employer. only to end up having to refund the sum in case of a final unfavorable decision. The employee is not required to reimburse whatever salary he may have received for he is entitled to such. although temporarily since the appeal may be decided in favor of the appellant. The suspension of claims partakes of the nature of a restraining order that constitutes legal justification for respondent’s non-compliance with the reinstatement order. a continuing threat or danger to the survival or even the life of the dismissed or separated employee and his family. the former NLRC Rules of Procedure was still applied in which it did not lay down a mechanism to promptly effectuate the self-executory order of reinstatement. the dearth of authority supporting Genuino renders inutile the rationale of reinstatement pending appeal. The provision of Art. LABOR RELATIONS Atty. Marquez Ruling: On the first issue. Considering that Genuino was not reinstated to work or placed on payroll reinstatement. the State may authorize an immediate implementation. 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. 7.

notified the employees of the its decision to mothball the wet line and the termination of those whose employment would become unnecessary as a result of the closure.. They further alleged that after the closure of the wet line. Ruling: In a Resolution dated 13 December 2006. Petitioner Almoite’s work as an oiler for both the wet line and dry line has become redundant or superfluous following the closure of the Page 166 . petitioner Union and some 80 of its members including petitioner Almoite filed complaints for unfair labor practice. is engaged in the manufacture of cement. informing him about respondent company’s decision to shut down the wet line and furnishing him the list of affected employees. Albarracin. respondent company and petitioner La Union Cement Workers Union (petitioner Union) entered into a Memorandum of Agreement on 19 July 1997. G. January 30. Rule 7 of the Rules of Court.. the termination of petitioner Almoite was a necessary consequence of the partial closure of operations of respondent company. After submission of the parties’ position papers and pleadings. It concluded that the scaling down of activities requiring support services was a consequence of the closure of the wet line. now known as Holcim Philippines. The judgment of dismissal has become final and executory with respect to petitioner Union on 08 February 2007. respondent company sent notices of termination to more or less 200 employees including petitioner Almoite. It held that the appeal was brought by petitioner Union and not by its members who were the real parties-in-interest and. Marquez 25. respondent company discovered that the "dry process technology" or the dry line proved to be more efficient as the cost was minimized by P15. To implement the closure of the wet line. Labor Arbiter Rimando found that respondent company complied with the requisite notice and severance pay mandated under Article 283 of the Labor Code. 2009 Facts: Private respondent Bacnotan Cement Corporation (respondent company). the new "dry process technology" became fully operational. Upon the receipt of the separation pay. Prior to 1994. In any event.R. respondent company introduced the "dry process technology" as part of its modernization program. La Union Cement Workers Union et al. 174621.. must be dismissed outright.00 per cement bag while the "wet process technology" or the wet line consumed more fuel and had to undergo frequent repairs and shutdowns due to its obsolescence. In an open letter dated 11 August 1997. The instant petition raises two issues: namely. After a comparative study of the two production lines. Regional Director of the Department of Labor and Employment (DOLE). whether petitioner Union is the real party-in-interest in this case and whether petitioner Almoite’s termination was valid. respondent company had been utilizing the "wet process technology" in its operations. thus. LABOR RELATIONS Atty. Labor Arbiter Irenarco R. among the employees terminated were operating the dry line or performing support services for both wet and dry lines. respondent company sent a letter to the office of Ricardo S. Magdaleno B. vs NLRC et al. Sometime in November 1997. In 1995. hence. Only 31 of the 80 employees pursued the complaints before the Labor Arbiter. Martinez. The question of petitioner Union’s capacity to sue on behalf of its members has become moot and academic in view of the judgment of dismissal of the instant petition which has already become final and executory with respect to petitioner Union. No. The NLRC held that the retrenchment on the ground of redundancy was valid in any case. On 15 August 1997. Rimando rendered a Decision on 19 March 1999 dismissing the complaints. As regards the claim that the services performed by the complainants were eventually assumed by employees who were retained or were contracted out. the remaining issue to be resolved in this petition pertains to petitioner Almoite’s claim that petitioner Union has failed to prove that his work as an oiler for both the wet and dry lines has become redundant with the closure of the wet line. a number of the affected employees signed individual Release Waiver and Quitclaim. As explained by the NLRC. the termination of the excess employees performing such support services followed as a matter of course. whereby respondent company committed to grant separation pay equivalent to 150% of the monthly basic pay for every year of service plus the additional fixed amount of P27. the respondent company’s Senior Executive Vice President. The petitioners alleged that while the closure affected only the wet line. arguing that respondent company failed to prove with substantial evidence that the retrenchment was absolutely necessary and unavoidable mainly because the affected employees were also performing support services in the wet line. Public respondent NLRC affirmed in toto the decision of Labor Arbiter Rimando.000. Jefferson M. Jr. La Union. Petitioner Almoite’s claim is clearly a factual question which is beyond the province of a Rule 45 petition. as only the president of petitioner Union signed the same in violation of Sections 4 and 5..00 to employees who would be terminated as a result of the closure of the wet line. Inc. respondent company contracted out the services performed by the employees who were terminated. the Court dismissed the petition with respect to petitioner Union for insufficiency or defective verification and certification of non-forum shopping. Labor Arbiter Rimando ruled that the employer had the prerogative to utilize its remaining workforce to the maximum. illegal lay-off and illegal dismissal against respondent company before the NLRC Regional Arbitration Branch 1 in San Fernando. Sometime in 1992. Thus. the Court finds no cogent reason to disturb the judgment of the Court of Appeals affirming the Labor Arbiter and NLRC rulings that the termination of petitioner Almoite and the other employees of respondent company. On 16 August 1997. Petitioners appealed to the NLRC.

and reinstated the LA’s ruling. hence. Mendros filed for a case of illegal dismissal. It proceeds from the erroneous premise that only those exclusively assigned to the wet line can be declared redundant. 1999. 2009 Facts: MMPC hired Mendros in 1994 as regular body repman. manpower services reduction. 90597 are AFFIRMED. The NLRC said that MMPC had not notified Mendros of the additional criterion and of the findings of the merit evaluation. Due to severe drastic slump of its vehicle sales brought about by the financial crisis in 1997. he was updated of the business conditions by MMPC. Thus. 26. the NLRC reversed said decision and declared that the dismissal was illegal stating that the merit rating system adopted by MMPC as additional criterion for retrenchment was erroneous and arbitrary. vs. being against the CBA. By and large. Page 167 .R. sustained a loss of PhP 470 million in 1997. Respondent had therefore all the reason to include such employees among those whom it considered redundant. some of which are employment-hiring freezing. the CBA listed only “seniority” and “needs of the company” as determinative factors. On the contrary. Jr. The Labor Arbiter decided in favor of MMPC. which proved in adequate. MMPC as per audited financial statements. the instant petition for review on certiorari is DENIED and the decision and resolution of the Court of Appeals in CA-G. it stands to reason that there was already an excess of employees performing support services. thus nullifying the retrenchment. certain activities were rendered either excess or no longer necessary. his termination on the ground of redundancy is an authorized cause for termination under Article 283 of the Labor Code. Upon appeal. The mere fact that an employee was performing support services for both the wet and the dry line does not in any way exclude him from being declared as redundant. SP No. 1999 due to continuing adverse market conditions. WHEREFORE. The latter received a letter informing him of the temporary suspension of his employment for six months from Jan 4 to July 2. Mitsubishi Motors Phils Corp. 1999. separation of casuals and trainees. In the interim. According to the NLRC. and attached its financial statements for 1997-1996 and 1998-1997 prepared by SGV & Co. Marquez wet line. In June 1. they argue that they could not be declared redundant by virtue of the closure of the wet line alone. In Feb 1998. The Court quotes with approval the following conclusions of the NLRC: x x x There is no dispute as to the fact that there was a partial closure or cessation of operations with the mothballing of the old wet-process production line of the company – a situation which falls among the authorized causes for termination allowed under Article 283 of the Labor Code.. the determination of whether to maintain or phase out an entire department or section or to reduce personnel lies with the management. 16. and PhP 771 million in 1998. x x x Neither is there any dispute that the logical and consequence [sic]of such partial cessation of operations was to render certain employees redundant.R. LABOR RELATIONS Atty. redundant. No. plant shutdowns. MMPC implemented various cost-cutting measures. including Mendros. This line of argument is non sequitur. Feb. since there was a curtailment in operations. and reduced work week for managerial and other monthly salaried personnel. Obviously enough. It then launched a temporary lay-off program of 170 hourly employees. Therefore. with the closure of the wet line and the consequent scaling down of activities requiring support services. MMPC defined the criteria used in considering employees for retrenchment. later promoted to assembler major in the company’s manufacturing division. 169780. G. MMPC notified DOLE that the temporary lay-off is being made permanent effective July 2. fallacious and totally untenable. Jefferson M. Mendros. The CA decided in favor of MMPC. Issue: Whether or not the temporary lay-off and eventual retrenchment was valid. it instituted the first stage of its retrenchment program affecting 531 hourly manufacturing employees. The only ostensible argument presented by appellant is the bare allegation that most of them were not exclusively assigned to the wet process line but were performing support services for both the wet line and the dry line. In its position papers.

as such imminence can be perceived objectively and in good faith by the employer. 1 is fair and reasonable. if not unreasonable. going on reduced time. if already incurred. if viewed by its self without linking it to the Sec. is that the Sec. It bears to state that Art. are reasonably imminent as perceived objectively and in good faith by the employer. Mendros argues that since Art. after less drastic means—e. All other things being equal. There can hardly be any dispute that MMPC suffered substantial and heavy losses in FY 1997 and continued to bleed in 1998. 283 of the LC. In the case at bench. and attendance as among the factors that should guide the company in choosing the employees to be laid-off or kept.” And to complement this prerogative. provides seniority.g. The right or management to retrench workers to meet clear and continuing economic threats or during periods of economic recession to prevent losses is recognized by Art. MMPC was already financially hemorrhaging before finally resorting to retrenchment. cut other costs than labor costs. Marquez Ruling: The retrenchment was valid. and potential hew with company standards. the employer’s prerogative to bring down labor costs by retrenching must be exercised essentially as a measure of last resort. Accordingly. the bonafide nature of the retrenchment would appear to be seriously in question. etc. Jefferson M. must be proved by sufficient and convincing evidence. To impart operational meaning to the constitutional policy of providing “full protection” to labor. in the exercise of its customary management functions and prerogatives on matters of promotions.” meaning that the company is accorded a reasonable latitude to assign a corresponding weight to each factor. If the loss purportedly sought to be forestalled by retrenchment is clearly shown to be insubstantial and inconsequential in character.. and that it uses fair and reasonable criteria in ascertaining who would be retrenched or retained. the merit rating used by MMPC based on Sec. alleged losses if already realized. (1) seniority (last-in. to be sure. Art. The requirements for a valid retrenchment are: that the retrenchment is reasonably necessary and likely to prevent business losses which. 1.e. which is after all a drastic recourse with serious consequences. The employer should have taken other measures prior or parallel to retrenchment to forestall losses. LABOR RELATIONS Atty. the substantial loss apprehended must be reasonably imminent. V of the CBA. first-out) and (2) the needs of the company. can scarcely claim to be retrenching in good faith to avoid losses. 5(c). 5(c) should be understood in the light of Sec. i. reduction of both management and rank-and-file bonuses and salaries. efficiency and attitude. and the expected imminent losses sought to be forestalled. The Court is not persuaded. As shown in its AFS for those fiscal years. Sec. are not merely de minimis. 5(c) “needs of the company” factor. in the same section. that the employer serves written notice both to the employees concerned and the DOLE at least a month before the intended date of retrenchment. There should be a certain degree of urgency for the retrenchment. Any suggestion that a billion peso plus loss is de minimis in extent has to be dismissed for sheer absurdity. Lastly. 283 of the Code uses the phrase “retrenchment to prevent losses. a company would necessarily need to retain those who had rendered dedicated and highly efficient service and whose knowledge. to consider as guiding norms the following factors or criteria: “Seniority.242 billion for its two-year operation. Sec 5(c) of the CBA provides for only two factors. Job Knowledge and Potential. 1 criteria qualify the factors of “seniority and needs of the company” in Sec. thirdly. V. job knowledge and potential. Because of the consequential nature of retrenchment. is given the discretion to “exercise just and fair evaluation of such factors. attendance. allows MMPC. Secondly. 5 in conjunction with and as qualified by the factors provided under Sec. would be a meaningless. 1 criteria. The Sec. and recall. that the employer exercises its prerogative to retrench in good faith. to stress.. The employer need not wait for substantial losses to materialize before exercising ultimate and drastic option to prevent such losses. or expected losses. the company. or only if expected. The reason for requiring this quantum of proof is readily apparent: any less exacting standard of proof would render too easy the abuse of this ground for termination of services of employees. and. The losses expected should be substantial and not merely de minimis in extent. An employer who lays off substantial numbers of workers while continuing to dispense fat executive bonuses and perquisites or so-called “golden parachutes”. Efficiency and Attitude. and Attendance. serious. be reasonably necessary and likely to effectively prevent the expected losses. it incurred an aggregate loss of PhP 1. but substantial. therefore. standard. that the employer pays the retrenched employee separation pay in an amount prescribed by the Code. it must. Sec. lay- off. Any other measure would be senseless in the business viewpoint. transfer. and real. the company is bereft of authority to arbitrarily impose other factors or criteria in effecting his retrenchment. 1 which.—have been tried and found wanting. costs. impending. The proper view.” The phrase necessarily implies that retrenchment may be effected even in the event only of imminent. to be considered in retrenching MMPC employees. well within the Page 168 .

This purportedly angered respondent’s management which retaliated by suspending and/or constructively dismissing them by drastically reducing their work days through the adoption of a work reduction/rotation scheme. Respecting the appellate court’s ruling that petitioners “simply disappeared” from their work. the same does not lie. at the time he was notified of his lay-off cannot be accorded tenability. Mendro’s lament about not being furnished a copy of the 1997-1996 and 1998-1997 AFS and other financial documents. two requisites must concur: first. and that in their position paper submitted before the NLRC. hence. 2002 by virtue of respondent’s memorandum of even date. when there is a demotion in rank or diminution in pay or both. petitioners only prayed for separation pay and not for reinstatement. Jefferson M. which affirmed the labor arbiter’s ruling with the modification that five of the complainants. hence. Rosa vs. there must have been a clear intention on the part of the Page 169 . Respondent appealed to the NLRC. they were constructively dismissed on April 15. The appropriate forum for an employee to contest the reality or good faith character of the retrenchment asserted as ground for dismissal from employment is before the DOLE.R. Criminal cases for estafa were likewise allegedly filed against several of the employees involved. Castillo. And the burden of proof to show that there was unjustified refusal to go back to work rests on the employer. namely Diana P. were directed to report back to work. Abandonment is a matter of intention and cannot lightly be inferred or legally presumed from certain equivocal acts. Hildao. Marquez contemplation of the parties’ CBA. among other things. March 13. absolving respondent’s manager Yolanda L. Respondent appealed and maintained that its act of reducing the number of work days per week was valid. insensibility. following settled jurisprudence. the employee must have failed to report for work or must have been absent without valid or justifiable reason. the NLRC held that Edgar de Leon was “actually dismissed but illegally” on November 7. Chan of any personal liability. There is no law or rule that requires an employer to furnish an employee to be retrenched copies of its AFS and other documents. 27. The appellate court reversed the NLRC decision and dismissed petitioners’ complaints holding that there was no constructive dismissal because petitioners “simply disappeared from work” upon learning of the work reduction/rotation scheme. G. Gilbert Ongjoco. or disdain by an employer becomes unbearable to the employee. No. On respondent’s motion for reconsideration. Absence must be accompanied by overt acts unerringly pointing to the fact that the employee simply does not want to work anymore. as it was done to save its business from bankruptcy due to economic reverses. and 10% of the monetary award as attorney’s fees. 2009 Facts: Petitioners file a complaint with the Department of Labor and Employment-NCR which prompted an inspection of the hotel’s premises by a labor inspector. Issue: Whether or not petitioners “simply disappeared” from their work constitute abandonment? Ruling: Case law holds that constructive dismissal occurs when there is cessation of work because continued employment is rendered impossible. Salvador So and Ma. Respondent’s sudden. arbitrary and unfounded adoption of the two-day work scheme which greatly reduced petitioners’ salaries renders it liable for constructive dismissal. Chan guilty of illegal dismissal and ordered them to pay petitioners’ separation pay at ½ month for every year of service with full backwages. respondent was found to have been violating labor standards laws and was thus ordered to pay them some money claims. LABOR RELATIONS Atty. The labor arbiter found respondent and its manager Yolanda L. Ambassador Hotel. 2001 and that with respect to the four other petitioners. the NLRC modified its decision by. With respect to petitioners. or when a clear discrimination. they are guilty of abandonment. 177059. as well as the finding of the merit evaluation rating. For abandonment to exist. the latter relief has been foreclosed. unreasonable or unlikely. Lorena L. and second. and respondent was directed to accept them without having to pay them backwages. some of which cases were eventually dismissed by the prosecutor’s office for lack of merit. Barcenilla. Pilar A.

The second element is the more determinative factor. (MPI). III-B of the Retirement Plan or Policy 1215 which both grant exactly the same benefit in case of involuntary separation – one month’s pay for every year of service. deliberate. G. paid to them. NLRC however has a reversed ruling holding that the benefits received by respondents for involuntary separation under MPI’s retirement plan included the service pay benefits under either Sec. which provides that In case of voluntary separation from the company due to Labor Saving devices or redundancy. 2009 Facts: Sometime in 1997. offering to its affected employees a redundancy/separation package consisting benefits and emoluments. Jefferson M. Issue: WON respondent-employees are entitled to their claim of another separate one-month pay per year of service in pursuant to Sec. Motorola Philippines. III-B of MPI’s Retirement Plan. 28. MPI alleged that the applicable retirement plan was not Sec. III-B of MPI’s Retirement Plan. March 30. CA reversed NLRC's decision. Inc. and unjustified refusal of the employee to resume employment. which consisted of two-months pay per year of service. the company shall provide a separation pay equivalent to one (1) month’s pay per year of service. Upon the other hand. which has the onus of proving that petitioners abandoned their work. Mere absence or failure to report for work. Motorola Phils. is not tantamount to abandonment. Out of about 900 employees who availed of the package and were consequently separated from employment. Ambrocio. negates respondent’s claim of abandonment. 173279. failed to discharge the same. retrenchment program initiated by the Company as a result of a merger or to prevent losses or other similar causes. v. LA ruled in favor of the respondents.R. however. Abandonment as a just ground for dismissal thus requires clear. but Policy 1215. for payment of retirement pay equivalent to one month salary per year of service. even after notice to return. petitioners’ immediate filing of complaints for illegal suspension and illegal dismissal after the implementation of the questioned work scheme. MPI thus insisted that respondents had already received such one-month pay. and since none of respondents retired but were actually involuntarily separated due to redundancy. Ruling: Petition granted. Cavite plant. No. Page 170 . An employee who takes steps to protest his dismissal cannot by logic be said to have abandoned his work. Marquez employee to sever the employer-employee relationship as manifested by some overt acts. the same having been included in the cash component of the separation/redundancy package. filed two separate complaints against MPI. 236 employees including respondents herein. decided to close its Parañaque plant in order to consolidate its operations at its Carmona. LABOR RELATIONS Atty. willful. inclusive of any service benefit eligibility under the Retirement Plan. Respondent. which scheme was adopted soon after petitioners’ complaints against respondent for violation of labor standards laws were found meritorious. alleging that they were entitled thereto under Sec. then they cannot avail of such pay. III-B.

LABOR RELATIONS
Atty. Jefferson M. Marquez

Respondents have no cause of action as against petitioners with respect to their claim for additional retirement benefits. Article 283 of the Labor
Code, as amended, provides:

ART. 283. Closure of establishment and reduction of personnel. – The employer may also terminate the employment of any employee due to the
installation of labor saving devices, redundancy, retrenchment to prevent losses or the closing or cessation of operation of the establishment or
undertaking unless the closing is for the purpose of circumventing the provisions of this Title, by serving a written notice on the workers and the
[Department] of Labor and Employment at least one (1) month before the intended date thereof. In case of termination due to the installation of
labor-saving devices or redundancy, the worker affected thereby shall be entitled to a separation pay equivalent to at least his one (1) month pay
or to at least one (1) month pay for every year of service, whichever is higher. In case of retrenchment to prevent losses and in cases of closures
or cessation of operations of establishment or undertaking not due to serious business losses or financial reverses, the separation pay shall be
equivalent to one (1) month pay or at least one-half (1/2) month pay for every year of service, whichever is higher. A fraction of at least six (6)
months shall be considered one (1) whole year." (Emphasis supplied)

Separation pay has been defined as the amount that an employee receives at the time of his severance and is designed to provide the employee
with the wherewithal during the period he is looking for another employment,16and is recoverable only in the instances enumerated under
Articles 283 and 284 of the Labor Code, as amended, or in illegal dismissal cases when reinstatement is no longer possible.

Retirement pay, on the other hand, presupposes that the employee entitled to it has reached the compulsory retirement age or has rendered the
required number of years as provided for in the collective bargaining agreement (CBA), the employment contract or company policy, or in the
absence thereof, in Republic Act No. 7641 or the Retirement Law.

It is admitted that respondents were terminated pursuant to a redundancy, and not due to retirement program, hence, they were entitled to a
separation pay of one month salary per year of service.

As correctly ruled by the NLRC, by whatever version of MPI’s Retirement Plan would be made applicable, respondents are entitled to a
separation pay of one month salary per year of service.

Thus, when respondents were paid a separation pay of two months salary for every year of service under the Redundancy Package, they
already received what was due them under the law and in accordance with MPI’s plan.

29. Perez et al., vs. Phil Telegraph & Telephone Company et al., G.R. No. 152048, April 7, 2009

Facts:

Felix B. Perez and Amante G. Doria were employed by Philippine Telegraph and Telephone Company (PT&T) as shipping clerk and supervisor,
respectively, in PT&T’s Shipping Section, Materials Management Group. Acting on an alleged unsigned letter regarding anomalous transactions
at the Shipping Section, PT&T formed a special audit team to investigate the matter. It was discovered that the Shipping Section jacked up the
value of the freight costs for goods shipped and that the duplicates of the shipping documents allegedly showed traces of tampering, alteration
and superimposition. Perez and Doria were placed on preventive suspension for 30 days for their alleged involvement in the anomaly. Their
suspension was extended for 15 days twice. A memorandum was issued by PT&T dismissing them from service for having falsified company

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documents. Perez and Doria filed a complaint for illegal suspension and illegal dismissal, alleging that they were dismissed on the date they
received the memorandum. They likewise contended that due process was not observed in the absence of a hearing in which they could have
explained their side and refuted the evidence against them.

Issue:

Whether or not the dismissal of Perez and Doria was legal.

Ruling:

The dismissal is illegal. PT&T did not observe due process when it failed to comply with the two-notice requirement for terminating employees.
ART. 277. Miscellaneous provisions. — x x x (b) Subject to the constitutional right of workers to security of tenure and their right to be protected
against dismissal except for a just and authorized cause and without prejudice to the requirement of notice under Article 283 of this Code, the
employer shall furnish the worker whose employment is sought to be terminated a written notice containing a statement of the causes for
termination and shall afford the latter ample opportunity to be heard and to defend himself with the assistance of his representative if he so
desires in accordance with company rules and regulations promulgated pursuant to guidelines set by the Department of Labor and Employment.
Any decision taken by the employer shall be without prejudice to the right of the worker to contest the validity or legality of his dismissal by filing
a complaint with the regional branch of the National Labor Relations Commission. The burden of proving that the termination was for a valid or
authorized cause shall rest on the employer.

Perez and Doria were neither apprised of the charges against them nor given a chance to defend themselves. They were simply and arbitrarily
separated from work and served notices of termination in total disregard of their rights to due process and security of tenure. Where the
dismissal was without just or authorized cause and there was no due process, Article 279 of the Labor Code, mandates that the employee is
entitled to reinstatement without loss of seniority rights and other privileges and full backwages, inclusive of allowances, and other benefits or
their monetary equivalent computed from the time the compensation was not paid up to the time of actual reinstatement. However, reinstatement
is no longer possible because of the length of time that has passed from the date of the incident to final resolution.

*** In this case, due process was not observed because of the violation of the twin – notice requirement. However, the absence of a hearing
does not always result to a denial of due process. The court had the following to say:

While a formal hearing or conference is ideal, it is not an absolute, mandatory or exclusive avenue of due process. An employee’s right to be
heard in termination cases is satisfied not only by a formal face to face confrontation but by any meaningful opportunity to controvert the charges
against him and to submit evidence in support thereof. "To be heard" does not mean verbal argumentation alone inasmuch as one may be heard
just as effectively through written explanations, submissions or pleadings. Therefore, while the phrase "ample opportunity to be heard" may in
fact include an actual hearing, it is not limited to a formal hearing only. In other words, the existence of an actual, formal "trial-type" hearing,
although preferred, is not absolutely necessary to satisfy the employee’s right to be heard. The employer may provide an employee with ample
opportunity to be heard and defend himself with the assistance of a representative or counsel in ways other than a formal hearing. The employee
can be fully afforded a chance to respond to the charges against him, adduce his evidence or rebut the evidence against him through a wide
array of methods, verbal or written. The following are the guiding principles in connection with the hearing requirement in dismissal cases:

(a) "ample opportunity to be heard" means any meaningful opportunity (verbal or written) given to the employee to answer the charges against
him and submit evidence in support of his defense, whether in a hearing, conference or some other fair, just and reasonable way.

(b) a formal hearing or conference becomes mandatory only when requested by the employee in writing or substantial evidentiary disputes exist
or a company rule or practice requires it, or when similar circumstances justify it.

(c) the "ample opportunity to be heard" standard in the Labor Code prevails over the "hearing or conference" requirement in the implementing

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Atty. Jefferson M. Marquez

rules and regulations.

Petitioners likewise contended that due process was not observed in the absence of a hearing in which they could have explained their side and
refuted the evidence against them. There is no need for a hearing or conference. We note a marked difference in the standards of due process
to be followed as prescribed in the Labor Code and its implementing rules. The Labor Code, on one hand, provides that an employer must
provide the employee ample opportunity to be heard and to defend himself with the assistance of his representative if he so desires:
Nonetheless, Section 2(d), Rule I of the Implementing Rules of Book VI of the Labor Code should not be taken to mean that holding an actual
hearing or conference is a condition sine qua non for compliance with the due process requirement in termination of employment. The test for the
fair procedure guaranteed under Article 277(b) cannot be whether there has been a formal pretermination confrontation between the employer
and the employee. The "ample opportunity to be heard" standard is neither synonymous nor similar to a formal hearing. To confine the
employee’s right to be heard to a solitary form narrows down that right. It deprives him of other equally effective forms of adducing evidence in
his defense. Certainly, such an exclusivist and absolutist interpretation is overly restrictive. The "very nature of due process negates any concept
of inflexible procedures universally applicable to every imaginable situation." Significantly, Section 2(d), Rule I of the Implementing Rules of Book
VI of the Labor Code itself provides that the so-called standards of due process outlined therein shall be observed "substantially," not strictly. This
is a recognition that while a formal hearing or conference is ideal, it is not an absolute, mandatory or exclusive avenue of due process.

An employee’s right to be heard in termination cases under Article 277(b) as implemented by Section 2(d), Rule I of the Implementing Rules of
Book VI of the Labor Code should be interpreted in broad strokes. It is satisfied not only by a formal face to face confrontation but by any
meaningful opportunity to controvert the charges against him and to submit evidence in support thereof. A hearing means that a party should be
given a chance to adduce his evidence to support his side of the case and that the evidence should be taken into account in the adjudication of
the controversy. "To be heard" does not mean verbal argumentation alone inasmuch as one may be heard just as effectively through written
explanations, submissions or pleadings. Therefore, while the phrase "ample opportunity to be heard" may in fact include an actual hearing, it is
not limited to a formal hearing only. In other words, the existence of an actual, formal "trial-type" hearing, although preferred, is not absolutely
necessary to satisfy the employee’s right to be heard.

30. Telecommunications Distributors Specialists Inc. et al., vs. Garriel, G.R. No. 174981, May 25, 2009, citing 2009 Perez

Facts:

Raymund Garriel was a Customer Service Assistant (CSA) working at Telecommunications Distributors Specialists Inc.(TDSI). He was in charge
of selling cellphones to customers as well as cellphone line accounts to subscribers from which he collected cash payments for. During these
various transactions, three notable incidents occurred. The first was when he forged the signature of a subscriber, Ms. Ratcliffe, when she forgot
to sign the coverage waiver in her application. The second incident was similar to the first, involving one Mila Huilar, where again, Garriel forged
her signature on her coverage waiver. The third incident involved Garriel in selling a defective cellphone personally owned by him to a subscriber
named Helcon Mabesa. He did not issue any official receipt for the transaction. These incidents were brought to the attention of the human
resource department by these three customers. Garriel was then given a notice to explain why he violated company rules and procedures.
Garriel denies all the accusations before him. An investigation ensued. Thereafter, Garriel was dismissed on grounds of serious misconduct and
loss of trust and confidence. Garriel files an illegal dismissal case against the company.

Issue:

1. Was Garriel illegally dismissed?

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Atty. Jefferson M. Marquez

2. Was due process observed in dismissing Garriel?

Ruling:

There was a valid dismissal. An employee entrusted with the company’s goods and properties, who thereafter violates company policies with
regard to the making fictitious documentation, willfully and knowingly selling defective products, and conniving with co-employees in creating a
cash shortage on the report to pay for his own cellphone constitute serious misconduct as well as loss of trust and confidence as grounds for a
valid dismissal. The company had complied with the twin due process requirement in terminating an employee. He was given a notice to explain
coupled with the list of violations of its company policy. The essence of due process is simply the opportunity to be heard. After being heard, an
investigation was conducted to determine the veracity of the facts alleged on both sides. The notice of dismissal was effected thereafter.

Principles:

1. Grounds for Loss of Trust and Confidence apply only to employees occupying positions of trust and confidence or those who are routinely
charged with the care and custody of the employer’s money or property. Requisites:

a. the loss of confidence must not be simulated;

b. it should not be used as a subterfuge for causes which are illegal, improper or unjustified;

c. it may not be arbitrarily asserted in the face of overwhelming evidence to the contrary;

d. it must be genuine, not a mere afterthought, to justify earlier action taken in bad faith, and,

e. the employee involved holds a position of trust and confidence.

2. Guiding principles in connection with the hearing requirement in dismissal cases:

A. ample opportunity to be heard means any meaningful opportunity, verbal or written, given to the employee to answer the charges
against him and submit evidence in support of his defense, whether in a hearing, conference or some other fair, just and reasonable way.

B. a formal hearing or conference becomes MANDATORY only when:

1. requested by the employee in writing or

2. substantial evidentiary disputes exist, or

3. a company rule or practice requires it, or

4. similar circumstances justify it.

C. the amply opportunity to be heard standards in the Labor Code PREVAILS over the hearing or conference requirement in the IRR.

3. Comment on Social Justice:

The policy of social justice is not intended to countenance wrongdoing simply because it is committed by the underprivileged. At best it may
mitigate the penalty but it certainly will not condone the offense. xxx Those who invoke social justice may do so only if their hands are clean and
their motives blameless and not simply because they happen to be poor. This great policy of our Constitution is not meant for the protection of
those who have proved they are not worthy of it, like the workers who have tainted the cause of labor with the blemishes of their own character.

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(Ha Yuan Restaurant v. NLRC)

31. Triumph International Philippines v. Apostol, G.R. No. 164423, June 16, 2009

Facts:

Respondent Apostol was hired as assistant manager by petitioner Triumph International (Phils.), Inc. (TIPI) in March 1991, and was terminated
by TIPI on 21 January 2000. On the other hand, respondent Opulencia was hired as a warehouse helper by TIPI sometime in 1990, and was the
company’s warehouse supervisor at the time of the termination of his employment on 21 January 2000. Apostol was the immediate superior of
Opulencia. On 14 and 15 August 1999, TIPI conducted an inventory cycle count of its direct and retail sales in its Muñoz warehouse. The
inventory cycle count yielded discrepancies between its result and the stock list balance Sugue (TIPI’s Marketing Services Manager) sent a
“show-cause letter” to Apostol, TIPI’s Assistant Manager-Warehouse and Distribution, requiring him to explain in writing the negative variance
based on the inventory cycle count.

On 21 January 2000, TIPI, through Sugue, served notices to Apostol and Opulencia, stating that their employment had been terminated for
committing infractions of the company’s rules and regulations. Specifically, Apostol was found to have committed Offense No. 3 (Fraud or willful
breach by an employee of the trust reposed in him by the Company) and Offense No. 25 (Using, uttering or saying profane, indecent, abusive,
derogatory and/or indecorous words or language against the employer or supervisor), while Opulencia was found to have committed Offense No.
3 only. On 28 January 2000, Apostol and Opulencia filed with the Labor Arbiter a complaint for illegal dismissal and non-payment of salaries and
other benefits against TIPI. Labor Arbiter rendered a Decision dismissing the Complaint for lack of merit. On appeal, the NLRC affirmed the
Decision of the Labor Arbiter. On 20 February 2004, the Court of Appeals rendered judgment, reversing and setting aside the NLRC Decision.

Issues:

WON respondents were illegally dismissed.

Ruling:

NO. We find the appeal meritorious.

In cases of termination of employees, the well-entrenched policy is that no worker shall be dismissed except for just or authorized cause
provided by law and after due process. Dismissals of employees have two facets: first, the legality of the act of dismissal, which constitutes
substantive due process; and second, the legality in the manner of dismissal, which constitutes procedural due process.

TIPI complied with the Procedural Due Process

The grounds to which respondents were held liable are among the just causes for termination of employment under Article 282 of the Labor

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Atty. Jefferson M. Marquez

Code.

Termination of employment based on Article 282 mandates that the employer substantially comply with the requirements of due process under
the rules implementing the Labor Code (Sec. 2(d), Rule 1, Book VI of the Omnibus Rules), to wit:

x x x

(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; and

(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.

x x x

There is no question that TIPI, in dismissing Apostol and Opulencia, complied with the above requirements of procedural due process. The
Court of Appeals even pointed out in its decision some of the documentary proofs of such compliance. We quote the pertinent portion of the
Court of Appeals’ decision, viz:

x x x In the present case, the evidence shows that the private respondent [TIPI] had substantially complied with the requirements of procedural
due process. The private respondent sent the following to the petitioners: (a) show cause letters addressed to the petitioners [Apostol and
Opulencia] requiring them to explain in writing within 48 hours upon receipt, the discrepancy on the cycle count conducted on the Muñoz
warehouse on August 14-15, 1999 and placing both of them on leave with pay until further notice pending investigation on the matter; (b)
memorandum dated October 22, 1999 addressed to petitioner Apostol showing the findings after the investigation was conducted by the private
respondent, requiring him to explain within 24 hours from receipt why he should not be terminated from his employment for loss of confidence;
and (c) the notices of termination dated January 21, 2000.

Substantive Due Process- R were dismissed for valid and just cause

Thus, we are left with the question on whether the alleged causes for dismissal of respondents Apostol and Opulencia are supported by
substantial evidence.

Apostol and Opulencia were dismissed mainly on ground of fraud or willful breach of trust. As previously mentioned, fraud or willful breach of the
employer’s trust is a just cause for termination of employment under Article 282(c) of the Labor Code. This provision is premised on the fact that
the employee concerned holds a position of trust and confidence, a situation which exists where such employee is entrusted by the employer
with confidence on delicate matters, such as care and protection, handling or custody of the employer’s property. But, in order to constitute a
just cause for dismissal, the act complained of must be “work-related” such as would show the employee concerned to be unfit to continue
working for the employer.

Recent decisions of this Court have distinguished the treatment of managerial employees from that of the rank-and-file personnel, insofar as the
application of the doctrine of loss of trust and confidence is concerned. Thus, with respect to rank-and-file personnel, loss of trust and
confidence, as ground for valid dismissal, requires proof of involvement in the alleged events in question, and that mere uncorroborated
assertions and accusations by the employer will not be sufficient. But as regards a managerial employee, the mere existence of a basis for

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Atty. Jefferson M. Marquez

believing that such employee has breached the trust of his employer would suffice for his dismissal. Hence, in the case of managerial
employees, proof beyond reasonable doubt is not required. It is sufficient that there is some basis for the employer’s loss of trust and
confidence, such as when the employer has reasonable ground to believe that the employee concerned is responsible for the purported
misconduct, and the nature of his participation therein renders him unworthy of the trust and confidence demanded of his position. Nonetheless,
the evidence must be substantial and must establish clearly and convincingly the facts on which the loss of confidence rests and not on the
employer’s arbitrariness, whims, and caprices or suspicion.

In this case, Apostol and Opulencia were not ordinary rank and file employees; they were managerial and supervisory employees. Apostol was
TIPI’s assistant manager for warehouse and distribution, while Opulencia was a warehouse supervisor. They were entrusted with the
management and handling of the company’s warehouse goods.

Thus, respondents were found by TIPI to have made unauthorized and unreported adjusting entries to the stocklist without proper investigation
and reconciliation with the Accounting Department, without prior authorization by management, and without preparation of formal reports
indicating the parties responsible for the adjustments and those who approved the same. This, according to TIPI, is a clear violation of the
company’s internal control procedures, which resulted to the loss of the company’s trust and confidence in the respondents.

Respondents do not deny making adjustment entries to the stocklist. In fact, both admitted making such adjustments in the office memoranda
and affidavits submitted as evidence in this case. The question, therefore, is whether respondents Apostol and Opulencia, in making such
adjustments, violated TIPI internal control procedures.

After a careful evaluation of the evidence on record, we are convinced that the respondents made unauthorized adjustments in TIPI’s stocklist, in
violation of the company’s internal control procedures. This act warrants respondents’ dismissal for willful breach of employer’s trust.

Considering the foregoing, we find that respondents Apostol and Opulencia were dismissed by TIPI for a valid and just cause. The relationship
of employer and employee, especially where the employee has access to the employer’s property, necessarily involves trust and confidence.
Where the rules laid down by the employer to protect its property are violated by the very employee who is entrusted and expected to follow and
implement the rules, the employee may be validly dismissed from service.

Finding the dismissal of respondents Apostol and Opulencia, based on willful breach of employer’s trust, valid, we deem it unnecessary to further
rule on TIPI’s other ground for Apostol’s dismissal, i.e., uttering indecent, abusive and derogatory words against his supervisor. Note, however,
that such act of an employee, if substantially proven, may be considered as serious misconduct which would warrant the termination of his
employment.

32. Technological Institute of the Phils Teachers and Employees Organization vs. Court of Appeals, et al., G.R. No. 158703, June 26,
2009

Facts:

Petitioner Magdalena T. Salon (Salon) was a College Instructor 3 of the Humanities and Social Science Department (HSSD) of respondent
Technological Institute of the Philippines (TIP) and a member of the Technological Institute of the Philippines Teachers and Employees

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Whether or not Salon is guilty of serious misconduct for falsifying Manalo’s (the son a co-faculty member) grade and violating the grading rules under the Manual of Regulations for Private Schools Ruling: Salon is guilty of the two valid causes.0 instead of a failing grade. P-66. However. and the allegation that there was no malice or bad intention on her part are misplaced arguments. Jefferson M. which requires a prior permission from the proper school authority should the teacher directly sell his/her examination papers to students. provided. She reportedly asked her students not to write on the test papers.0 (dropped). The final grade or rating given to a pupil or student in a subject should be based on his scholastic record. ruling in favor of TIP and against Salon. Page 178 . LABOR RELATIONS Atty. usually for reimbursement. In the process. the cost shall be within the rate prescribed by the school. Salon answered that she only collected P0. a condition precedent required by TIP Memorandum no. On separation pay: CA erred on this matter. for unauthorized selling of examination papers 2. But what is really determinative is TIP Memorandum No. geared towards avoidance of unduly burdening the students from unreasonable finances. The present violation involves elements of falsification and dishonesty. Any addition or diminution to the grade x x x shall not be allowed. this is Serious Misconduct under Article 282(a) of the Labor Code. Whether or not Salon is guilty of violating TIP’s Memorandum No. Salon gave him a grade of 6.0 (failed) to 6. said decision was affirmed by CA. The violation constituted serious misconduct or a cause relating to the employee’s moral character. On the sale of Papers: The cost of the sale of test papers by Salon to her students was within the prescribed parameters of the school. the TIP received complaints from students claiming that Salon was collecting P1. falsified – her own records by changing the submitted record and the supporting documents. Further. Issue: 1. P-66. P-66. On grade tampering: It is a violation against the Manual of Regulation for Private Schools whose Section 79 provides: Sec. In addition. CA reversed itself. Sometime in year 2000. The fact that Salon committed an offense for the first time. or she has served for 10 years in TIP. Thus. she admitted of having changed the grade in order to vindicate the student from the wrath of his father. However. it cannot be denied that Salon did not first obtain the prior permission of the proper school authority. Marquez Organization (TIPTEO). separation pay is not proper. on motion for reconsideration. Viewed in any light. On appeal under Rule 43. The Voluntary Arbitrator ruled in favor of Salon.50 per page for the test paper used in the subject she was teaching at the time. Clearly. a complaint was filed against her for anomalously changing the grade of a particular student who was at the same time a son of a co-faculty member from 5. she changed – in short. There were enumerated TIP Memoranda in the case. Basis for Grading. Knowing fully what Manalo deserved. but granted separation pay. she transgressed the school regulation. these test papers were not returned to the students after the test. 79. and a just cause for termination of employment. Salon believed that a “dropped” grade is better than a “failed” mark.50 per page to reimburse herself from personal expenses.

Macaraig sent a memorandum to petitioner charging her with gross and habitual neglect of duty and/or misconduct or willful disobedience and insubordination. we hereby DENY the petition for lack of merit. Inc (OGMM). Jefferson M. Ocean Gateway Maritime and Management Services Inc. 179293. resulting in respondent’s incurring of penalties totaling P18. hired Eden Llamas as an accounting manager. Moreover.. Llamas. detailing therein the bases of the charges. Costs against the petitioners. Under Article 282 (b) of the Labor Code. Malaysian Merchant Marine Bhd. and requiring her to submit a written explanation why she should not be penalized or dismissed from employment but OMGG found the explanation unsatisfactory Issues: WON the dismissal was for a just cause WON due process was observed Ruling: THE DISMISSAL WAS FOR A JUST CAUSE. not to mention the employees/members’ contributions being unupdated. hence. Gross negligence is characterized by want of even slight care. No.R. negligence must be both gross and habitual to justify the dismissal of an employee. LABOR RELATIONS Atty. however. failed to discharge her important duty of remitting SSS/PhilHealth contributions not once but quadruple times.41. on-the-job Page 179 . In the present case. August 14. 2003. Her claim of being overworked and undermanned does not persuade. 2009 Facts: Ocean Gateway Maritime and Management. Llamas v. with only a few transactions and only with one principal. she failed to remit the contributions as early as November 2001 during which time. as respondent’s Accounting Manager. but DELETE the award of separation pay. But Llamas failed to comply with the instruction as money for the purpose was not credited to the company’s account at the bank. OGMM's Chief Executive Officer Macaraig called petitioner’s attention because of her failure. premises considered. We hereby AFFIRM the amended decision of the Court of Appeals promulgated on May 22.580. its financial and accounting books should not have been difficult to prepare. as claimed by respondent which was not refuted by petitioner. 33. the company had been in operation for less than three (3) months at the time the negligence and delays were committed. not inadvertently but willfully and intentionally with a conscious indifference to consequences insofar as other persons may be affected.. Marquez WHEREFORE. despite repeated demands. As noted by respondent. G. to accomplish the long overdue monthly and annual company financial reports and to remit the company’s contributions to the SSS and PhilHealth. acting or omitting to act in a situation where there is a duty to act.

Lowe hired Mutuc as a Creative Director to help out the four other Creative Directors of Lowe. v. Jefferson M. submit her explanation on why she should not be disciplined or dismissed. but of the law itself. Thus. 2002 due to hypertension.000 a month and Mutuc became a regular employee. willful in character. which petitioner claims to be due to the fact that the money intended for payment was not yet credited as of February 20. At the height of the influx of advertising projects. she had already been in delay in the performance of her duties. was supposed to benefit respondent. (a) it must be serious. Both were included in the complaint for illegal dismissal in their capacity as officers of Lowe. as she did. On petitioner’s declaration that “I believe that I did something good for our office when our declaration of gross income submitted to City Hall for the renewal of our municipal license was lower than our actual gross income for which the office had paid a lower amount. CA. (b) must relate to the performance of the employee’s duties. x x x Misconduct has been defined as improper or wrong conduct. however. for misconduct or improper behavior to be a just cause for dismissal. a forbidden act. the termination of her services was effected after she was afforded the opportunity to. Mutuc was given a salary of P100. 2002 to respondent’s bank account. and Maria Elizabeth "Mariles" L. and implies wrongful intent and not mere error of judgment. for as correctly ruled by the appellate court. Far from being arbitrary. the Court rules in the affirmative. LABOR RELATIONS Atty. Page 180 . her claim of being undermanned behind such failure does not lie. Castro (Castro) is the Executive Creative Director . It is the transgression of some established and definite rule of action. given that at that time. the Court is not persuaded. Lowe Inc. was. Verily. it bears reiteration.. which explanation. Such misconduct. Marquez trainees were still with the company. Gustilo (Gustilo) 9 is the Chief Executive Officer and President of Lowe. and put respondent at risk of being made legally liable. August 14.R. an employer cannot be compelled to retain in its employ someone whose services is inimical to its interests.” the Court finds the same as betraying a streak of dishonesty in her. which to her warped mind. Indeed. a dereliction of duty. 34. It was not merely a violation of company policy. As to the second issue of whether due process was accorded petitioner. 164813 & 174590. The misconduct to be serious must be of such grave and aggravated character and not merely trivial and unimportant. As to the delay in the remittance of SSS/PhilHealth contributions for January 2002. while Raul M.[12] (Emphasis supplied) For her act of understating the company’s profits or financial position was willful and not a mere error of judgment. it warrants her dismissal from employment as respondent’s Accounting Manager. found unsatisfactory. as well as to her absence the following day or on February 21. and (c) must show that the employee has become unfit to continue working for the employer. It partakes of serious misconduct. must nevertheless be in connection with the employee’s work to constitute just cause for his separation. 2009 Facts: Lowe is an advertising agency. G. however serious. 2. committed as it was in order to “save” costs. an employer may not be compelled to continue to employ such person whose continuance in the service would be patently inimical to his employer’s interest. hence.

Mutuc also did not present contrary evidence to disprove that she was the least efficient and least competent among all the Creative Directors. The determination of the continuing necessity of a particular officer or position in a business corporation is a management prerogative. an employer has no legal obligation to keep more employees than are necessary for the operation of its business. (2) efficiency. whichever is higher. WON Mutuc was validly dismissed by reason of redundancy 2. Mutuc filed a complaint for illegal dismissal. hence this petition. 283) The controversy lies on whether Lowe used any fair and reasonable criteria in declaring Mutuc’s position redundant and whether there was bad faith in the abolition of her position. and the courts will not interfere unless arbitrary or malicious action on the part of management is shown. The Court of Appeals modified the NLRC’s decision rendered in favor of Mutuc. WON Mutuc is entitled only to separation pay and proportionate 13th month pay Ruling: Yes. Both Lowe and Mutuc filed petitions for certiorari before the Court of Appeals. the employer must comply with the following requisites: (1) written notice served on both the employee and the DOLE at least one month prior to the intended date of termination. Marquez A year after. who was hired only on 23 June 2000. Among the accepted criteria in implementing a redundancy program are: (1) preferred status. Indeed. nonpayment of 13th month pay with prayer for the award of moral and exemplary damages plus attorney’s fees against Lowe. and (4) fair and reasonable criteria in ascertaining what positions are to be declared redundant. Lowe implemented cost-cutting measures including a redundancy program and Lowe terminated Mutuc’s services because her position was declared redundant. (2) payment of separation pay equivalent to at least one month pay or at least one month pay for every year of service. most of Lowe’s clients reduced their advertising budget. Lowe employed fair and reasonable criteria in declaring Mutuc’s position redundant. (See Art. Redundancy exists when the service of an employee is in excess of what is reasonably demanded by the actual requirements of the business. and (3) seniority. (3) good faith in abolishing the redundant position. For a valid implementation of a redundancy program. Page 181 . Labor Arbiter dismissed Mutuc’s complaint NLRC reversed the decision. In response to the situation. LABOR RELATIONS Atty. The Court recognizes that a host of relevant factors comes into play in determining who among the employees should be retained or separated. Issues: 1. did not deny that she was the most junior of all the executices of Lowe. Mutuc. Jefferson M.

Jefferson M. and registered pursuant to Presidential Decree No. Petitioner Estacio sought a reconsideration of the said decision but it was denied by respondent Engr. the Internal Auditor of respondent PELCO I. with the modification deleting the charge of dishonesty. August 19. Allas rendered a Decision which adopted the recommendation of the investigation committee dismissing petitioner Estacio from service. with forfeiture of her benefits. Allas. Estacio v. submitted her Audit Findings: Evaluation of the results of physical inventory of bills through reconciliation of records such as aging schedule of consumer accounts receivable balance. while petitioner Manliclic had been working for respondent PELCO I as a bill collector since June 1992.93) remained unremitted as of August 20.R. petitioner Estacio averred that she had no control over and should not be held answerable for the failure of the bill collectors at the San Luis Area Office to remit their daily collections. Unsatisfied with petitioner Estacios explanation. within 72 hours upon receipt thereof. On 22 August 2002. Respondent Engr. respondent Engr. incorporated. Allas issued a Memorandum to petitioner Estacio informing her of the audit findings.807. 2009 Facts: This is a Petition for Review on Certiorari. In her written explanation. Nelia D. 269. Pampanga I Electric Cooperative.2[5] Respondent Engr. Estacio amounting to One Hundred Twenty Three Thousand Eight Hundred Seven and 14/100 (P123.14) representing 86 bills. G. collection reports and other related documents revealed 87 bills amounting to One Hundred Twenty Six Thousand Seven Hundred Fifty and 93/100 (P126. No. 2002. Labor Arbiter ruled in favor of respondents.750. why no disciplinary action should be imposed upon her for Gross Negligence of Duty. Accounting of which includes the accountability of Ms. A formal investigation/hearing then ensued. Allas is the General Manager Petitioner Estacio had been employed at respondent PELCO I as a bill custodian since 1977. 183196. Allas issued a Memorandum charging Estacio with gross negligence of duty. Marquez Yes 35. Respondent PELCO I is an electric cooperative duly organized. LABOR RELATIONS Atty. Lorenzo (Lorenzo). Page 182 . Respondent Engr. and directing her to explain in writing. NLRC disagreed with the Labor Arbiter. during which petitioner Estacio was duly represented by counsel.

Petitioner Manliclics honesty and integrity are the primary considerations for his position as a bill collector because. Court rules that there is valid cause for petitioner Manliclic dismissal from service. It evinces a thoughtless disregard of consequences without exerting any effort to avoid them. that personnel with pending administrative cases or who are under preliminary investigation may avail of the SSIP. payment of their benefits shall be made only after the resolution of their cases and only if they are not disqualified from receiving such benefits. gross violation of bank rules and regulations. It is undisputed that petitioners were accorded due process. More than the resulting material damage or prejudice. Jefferson M. Petitioner Estacio. and conduct prejudicial to the best interest of the bank. Her only reason for failing to comply with the requisite daily accounting and reporting of the bill collections was the terrible weather condition. the guidelines for the availment of the SSIP. 163788. G. despite the opportunities given to her. No. Special Separation Incentive Plan (SSIP). did not offer any satisfactory explanation or evidence in her defense. the negligence should not merely be gross. advantage or benefit to a private party through manifest partiality and evident bad faith committed Page 183 . This constitutes valid cause for his dismissal from service Court of Appeals is AFFIRMED 36. Through the Memoranda issued by respondent Engr. PNB stated: By giving undue and unwarranted preference. There was a legal dismissal of petitioner Estacio.prior to remittance -. respondent PELCO I. Maralit v.R. August 24. However. Allas. 2009 Facts: Ester B.a highly essential property of the cooperative. Maralit (Maralit) worked for respondent Philippine National Bank (PNB) from 27 August 1968 to 31 December 1998(30 years). To warrant removal from service. The amount misappropriated by petitioner Manliclic is irrelevant. but also habitual. it is petitioner Manliclic’s very act of misappropriation that is offensive to respondent PELCO petitioner Manliclic committed a breach of the trust reposed in him by his employer. The Court also finds that there was valid cause for petitioner Estacios dismissal. She began as a casual clerk and climbed her way to become branch manager. petitioners were duly informed of the results of the audit conducted by Internal Auditor Lazaro. he has in his absolute control and possession -. Marquez Issue: WON Estacio and Manliclic were legally dismissed? Ruling: Yes. PNB charged Maralit with serious misconduct. or the total absence of care. PNB. Gross negligence connotes want or absence of or failure to exercise even slight care or diligence. LABOR RELATIONS Atty. which were unfavorable to petitioners. as such. offered its personnel an early retirement plan known as . Petitioner Estacio’s failure to make a complete accounting and reporting of the bill collections plainly demonstrated her disregard for one of her fundamental duties as a bill custodian. PNB.

(2) in a memorandum dated 9 July 1998. (3) Maralit submitted a memorandum dated 9 July 1998 admitting the irregular transactions. (5) on 15 July 1998. Lat of Branch Operations and Consumer Banking Division for Southern Luzon and Bicol referred Maralit’s irregular transactions to the IAG for immediate investigation. the IAG found that Maralit violated bank policies which resulted in the return of unfunded checks amounting to P54.” Under the SSIP. Maralit filed with the arbitration branch of the NLRC a complaint for non-payment of retirement benefits and separation pay. “Attached is the Internal Audit report dated September 8.000 drawings against uncollected deposits.000 and recommended that Maralit be required to submit her written answer under oath. and conduct prejudicial to the best interest of the bank. PNB placed Maralit under preventive suspension. Maralit submitted her answer dated 11 January 1999.359. (9) in its 29 September 1998 memorandum. Maralit was entitled to P1. (7) in a memorandum dated 8 September 1998. 1998. and (10) in its 16 October 1998 memorandum. finding her guilty of serious misconduct. PNB stated. (6) on 28 July 1998. (4) on 9 July 1998. In its 16 October 1998 memorandum. Jefferson M. provided that the decision in said investigation does not disqualify you from the enjoyment of said benefits. (8) on 15 September 1998. On 20 November 1998. Willful Breach of Trust and Gross Violation of Bank Rules and Regulations under Article 282 of the Labor Code. “In connection with the Special Audit report of Internal Audit Group dated September 8. Maralit assumed her new assignment at the Naga Branch. In 2000 PNB found Maralit. a certain Gay Ophelia T.950. PNB stated that. Vice President Florencio C. PNB conditionally approved Maralit’s application for early retirement effective at the close of business hours on 31 December 1998. Rule XIV of the Omnibus Rules Implementing the Labor Code. Marquez by you while performing the duties as Manager as follows: (1) in a memorandum dated 8 July 1998. She stated that “The favorable accommodations granted. PNB stated.950. gross violation of bank rules and regulations. She admitted that the accommodations were “deviations from Bank’s policies.02 retirement benefits. and PNB’s interest was unreasonably put at risk.086. Maralit filed her application for early retirement.” Internal Audit Group (IAG) asks Maralit for a written answer under oath to the above charges together with whatever affidavits and other documentary evidence you may wish to submit within five (5) days from receipt of this memorandum why she should not be penalized for Serious Misconduct. Vice President Milagros Pastrana of Branch Administrative Office for Southern Luzon and Bicol recommended that Maralit be temporarily assigned to the Naga Branch. and for damages Page 184 . uncollected deposits were a wanton violation of the policy of the Bangko Sentral ng Pilipinas (BSP) and PNB. claiming that were made in good faith and intended for the higher interests of the Bank. PNB reported to the BSP the P54. She had no discretion to do prohibited acts. LABOR RELATIONS Atty. “Payment of Special Separation Incentive and other Benefits shall be made only upon final resolution of the administrative case against you. PNB stated: Maralit placed under preventive suspension for thirty (30) days effective upon receipt hereof pursuant to Section 3. 1998”. PNB dismissed Maralit from the service with forfeiture of her retirement benefits effective at the close of business hours on 31 December 1998. Alano reported Maralit’s irregular transactions.

1998? Whether or not she has committed Serious Misconduct. (2) the material facts as found by the Labor Arbiter were consistent with the evidence. or rebut the evidence presented against her. claiming that the Labor Arbiter gravely abused his discretion and erred in his factual findings. Each is a distinct and separate mode of extinguishing an employer-employee relationship. and P155. PNB gave Maralit ample opportunity to explain her side.P200. Three investigative bodies are separate and independent from each other.359. and (5) PNB illegally dismissed Maralit and committed an act oppressive to labor. In its 29 September 1998 memorandum. PNB directed Maralit to submit her written answer under oath together with affidavits and other documentary evidence: The administrative investigation in PNB undergoes a three-tiered process which commences with an audit report made by the Internal Audit Division (IAD). an opportunity to explain one’s side. Page 185 . “Retirement” and “Dismissal” are entirely different and incompatible from each other. The NLRC held that (1) there was no grave abuse of discretion on the part of the Labor Arbiter. and they proceed without influence from the other bodies having their own respective mandates and processes.000 exemplary damages. Maralit invoking the principle on estoppel. The Court of Appeals found that Maralit was under preliminary investigation when she filed her application for early retirement and that she was afforded due process. that an employer who accepts or approves the retirement of an employee loses the right to dismiss such employee in a subsequent action. (3) when PNB approved Maralit’s application for early retirement. The NLRC deleted the award of P200. and (3) Maralit was not entitled to attorney’s fees. Consequently. The Labor Arbiter held that Maralit was entitled to P1.086. present her evidence. Willful Breach of Trust and Gross Violation of Bank Rules and Regulations under Article 282 of the Labor Code that will forfeit her retirement benefits? Ruling: The evidence shows that Maralit was afforded due process. Issues: Whether or not Ester Maralit has retired or was dismissed from the service effective December 31.908.02 retirement benefits. NLRC affirmed with modification the Labor Arbiter’s 22 January 2001 Decision. Marquez against PNB. The Court of Appeals held that the NLRC committed grave abuse of discretion when it affirmed the Labor Arbiter’s 22 January 2001 Decision. as applied to administrative proceedings. the Administrative Adjudication Panel had not decided the administrative case against her. PNB claimed that the NLRC committed grave abuse of discretion when it affirmed the Labor Arbiter’s 22 January 2001 Decision because (1) Maralit was not entitled to retirement benefits. PNB appealed to the NLRC.000 exemplary damages. they cannot be taken together for the purpose of terminating employment relation. A formal or trial-type hearing is not essential. The Labor Arbiter found that (1) Maralit was not under preliminary investigation when she filed her application for early retirement. she would not have availed of the SSIP so that she could continue receiving her monthly salary. and (3) the award of exemplary damages lacked basis. (2) had Maralit known that she would be administratively charged. LABOR RELATIONS Atty. (2) Maralit was afforded due process. and has its own legal effects in our jurisdiction.60 attorney’s fees. Jefferson M. The essence of due process is an opportunity to be heard or. (4) there was no hearing or conference held where Maralit could respond to the charge.

PNB may rightfully terminate Maralit’s services for a just cause. a transgression of some established and definite rule of action. including petitioners. Maralit is not entitled to her retirement benefits. Issue: Whether or not petitioners were illegally dismissed from their employment by the respondent Ruling: Page 186 . Incorporated (BENECO). PNB consistently stated that payment of Maralit’s retirement benefits shall be paid only after final resolution of the administrative case against her. 37. They also questioned the validity of BENECO’s downsizing measure. Petitioners accepted respondent’s offer and thereby received benefits. almost P4. petitioners filed a complaint for illegal termination of employment against BENECO. The Labor Abiter dismissed their claims for lack of merit. The evidence shows that Maralit was under preliminary investigation when she filed her application for early retirement. 168927. including serious misconduct. Having been dismissed for a just cause. No. Serious misconduct is improper conduct. Petitioner was a bank accountant. BENECO offered them an option to retire under a newly created optional retirement program which would provide them with more benefits than what is statutorily required. provided that she is not disqualified to receive such benefits. a forbidden act. LABOR RELATIONS Atty. BENECO started automating its operations. said court found for them and ordered BENECO to reinstate them. Nearly four months after their severance from their employment however. reversed NLRC decision which prompted petitioner to file the instant case. The amount involved is significant. Benguet Electric Cooperative. They claimed that notwithstanding the fact that they had no intention of retiring.5 million. The Court of Appeals. 2009 Facts: Petitioners are former employees of respondent Benguet Electric Cooperative. they were forced to do so because BENECO would have them terminated had they insisted otherwise. or a dereliction of duty. Quevedo v. which is a position of trust and confidence. in a petition for certiorari made by herein respondent. However. Marquez The Court is unimpressed. Jefferson M. rendering redundant the functions performed by some employees.R. There is substantial evidence showing that there was valid cause for the bank to dismiss petitioner’s employment for loss of trust and confidence. Instead however of terminating outright petitioners and paying them statutory benefits under the Labor Code. G. upon reaching the NLRC. September 11.

e. Placido et al. For retirement. depending on the cause. Marquez There was no illegal dismissal. 2009 Facts: Petitioners Placido and Caragay had been employed as cable splicers by PLDT. they simply chose. involuntary retirement amounts to a discharge. petitioners accepted BENECO’s offer without reservation and received payments without protest. Finally.e. Furthermore. In determining such intent. LABOR RELATIONS Atty. responding to a report that cables were being stripped and burned in one of the residences. Although superficially appealing. and the absence of badges of intimidation or coercion are relevant parameters. NLRC. this argument rests on an unfair. No. Voluntary retirement cuts employment ties leaving no residual employer liability. Petitioners nevertheless argue that their inevitable termination forced their hands. will not efface such privilege if only to protect the person holding that office. As already decided by this Court in Benguet Electric Cooperative v. albeit without success as BENECO stood pat on its management decision. PLDT had been receiving reports of theft and destruction of its cables. petitioners requested BENECO to reconsider its decision to abolish their positions but this is a natural inclination to keep one’s livelihood. the exit route offering bigger benefits. they are mutually exclusive. It does not rise to that level of intimidation or coercion sufficient to vitiate consent. Nor were petitioners here denied the stipulated benefits. while termination of employment is statutory (i. leaving them no choice but to retire from service. proceeded to the said area where they saw petitioners’ service vehicle parked infront of the house. the payment of stipulated benefits. 180888. The records show that on average. The employee’s intent is the focal point of analysis. Petitioners were seen stripping and burning cables inside the compound of the house which turned out to belong to Caragay’s mother. The marked difference between these two bundles of benefits not only factored in petitioners’ decision to retire under the EVR program but also explained the lapse of nearly four months before petitioners sued BENECO. but predictably biased. As to whether the retirement in this case was done voluntarily. benefits and procedure). September 18. transparent and fully documented. True. While termination of employment and retirement from service are common modes of ending employment. between two equally valid options. with varying juridical bases and resulting benefits. the line between voluntary and involuntary retirement is thin but it is one which this Court has drawn. G. Fianza : [T]he abolition of a position deemed no longer necessary is a management prerogative. It is inappropriate to discuss whether the requirements for terminating an employee had been complied with since the petition is focused on whether the retirement was made voluntarily. assumption. rendering the employer liable for termination without cause. governed by the Labor Code and other related laws as to its grounds. based on the bilateral agreement of the employer and employee). absent any findings of malice and arbitrariness on the part of management. v. and this Court. Petitioners were afforded opportunity to seek reconsideration of BENECO’s decision to downsize. The records presented show sufficient compliance with the criteria. PLDT inspector and security guard. the fairness of the process governing the retirement decision. Retirement from service is contractual (i. the manner by which BENECO arrived at its decision to downsize and at the same time spare petitioners the lesser benefits under Article 283 of the Labor Code by creating a more generous retirement package was regular.R. With the Page 187 . Article 287 of the Labor Code gives leeway to the parties to stipulate above a floor of benefits. the benefits each of the petitioners received were more than twice their statutory counterpart under Article 183. petitioners were not compelled to retire. 38. Jefferson M. The benefits resulting from termination vary.

Labor Arbiter held that petitioners were illegally dismissed which was reversed by the NLRC. and present his evidence or rebut the evidence presented against him. Their request for a copy of the Security Investigation was denied. Any decision taken by the employer shall be without prejudice to the right of the worker to contest the validity or legality of his dismissal by filing a complaint with the regional branch of the National Labor Relations Commission. 2001 hearing. but the same was denied. hence. Section 2(d). By their claim. Pettitioners appealed to CA which affirmed the NLRC Decision holding that since the cables bore the "PLDT" marking. PLDT recovered the cables bearing the "PLDT" marking. A third time request for another hearing was likewise denied. Thus Rule I. the following standards of due process shall be substantially observed: 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. PLDT filed an Information for Qualified Theft against petitioners. a formal hearing was scheduled. but they failed. petitioners were not denied due process. the employer shall furnish the workers whose employment is sought to be terminated a written notice containing a statement of the causes for termination and shall afford the latter ample opportunity to be heard and defend himself with the assistance of his representative if he so desires in accordance with company rules and regulations promulgated pursuant to the guidelines set by the Department of Labor and Employment. Issue: WON petitioners were denied due process and were illegally dismissed Ruling: No. The burden of proving that the termination was for a valid or authorized cause shall rest on the employer. Article 277 of the Labor Code provides: (b) Subject to the constitutional right of workers to security of tenure and their right to be protected against dismissal except for a just or authorized cause and without prejudice to the requirement of notice under Article 283 of this Code. They were legally dismissed. Security of Tenure. and giving said employee reasonable opportunity Page 188 . and they cannot demand for the report as it is still on the confidential stage. LABOR RELATIONS Atty. Jefferson M. provides: Section 2. the burden of evidence shifted on petitioners to prove that they were no longer owned by PLDT. however. On petitioners’ request. — (d) In all cases of termination of employment. on the ground that they are only entitled to "be informed of the charges. they were on their way back from the house of one Quezada from whom they were inquiring about a vehicle when they were detained by the PLDT investigator. And the Omnibus Rules Implementing the Labor Code require a hearing and conference during which the employee concerned is given the opportunity to respond to the charge. PLDT also required petitioners to explain within 72 hours why no severe disciplinary action should be taken against them for Serious Misconduct and Dishonesty. Petitioners submitted a joint explanation denying the charges against them. Petitioners’ counsel later reiterated the request for a setting of a hearing and an audiotape of the June 25. PLDT sent notices of termination to petitioners. they were presumed to be owned by PLDT. prompting them to file a complaint for illegal dismissal before the Labor Arbiter. Marquez assistance of police and barangay officials.

is given opportunity to respond to the charge. Martinez v. Lucinario (Lucinario) and Jose Suico.R. however. B&B Fish Broker. as he did. Jefferson M. 39. A hearing was conducted where petitioners attended along with their union MKP representatives during which the principal witnesses to the incident were presented. petitioners were. Petitioners were thus afforded the opportunity to confront those witnesses and present evidence in their behalf.1avvphi1 (iii) A written notice of termination served on the employee. When petitioner reported back for work. Page 189 . but they failed to do so. As cashier. a partnership owned and managed by respondent Norberto M. Marquez within which to explain his side. Martinez (petitioner) was employed as a cashier by B&B Fish Broker. No. as applied to administrative proceedings. The abovequoted provision of Section 2(d) should not be taken to mean. 179985. the requirements of which are satisfied where the parties are afforded fair and reasonable opportunity to explain their side of the controversy. G. The "ample opportunity to be heard" standard is neither synonymous nor similar to a formal hearing. September 18. To confine the employee’s right to be heard to a solitary form narrows down that right. A formal or trial type hearing is not at all times and in all instances essential to due process. (ii) A hearing or conference during which the employee concerned. For the test for the fair procedure guaranteed under the above-quoted Article 277(b) of the Labor Code is not whether there has been a formal pretermination confrontation between the employer and the employee. grounds have been established to justify his termination. Lucinario called petitioner’s attention to his alleged shortages in his cash collections and ordered him to. SC found that as the cables bore the "PLDT" marking. The essence of due process is simply an opportunity to be heard or. present his evidence or rebut the evidence presented against him. take a leave the following day. In the present case. that holding an actual hearing or conference is a condition sine qua non for compliance with the due process requirement in case of termination of employment. but they failed to heed them. What the law prohibits is absolute absence of the opportunity to be heard. a party cannot feign denial of due process where he had been afforded the opportunity to present his side. given several written invitations to submit themselves to PLDT’s Investigation Unit to explain their side. the presumption is that PLDT owned them. petitioner’s duties consisted of issuing receipts on items taken and bought and balancing of the cash on hand and receipts issued at the close of the business day. an opportunity to explain one's side or an opportunity to seek a reconsideration of the action or ruling complained of. indicating that upon due consideration of all the circumstances. 2009 Facts: Odilon L. with the assistance of counsel if he so desires. hence. LABOR RELATIONS Atty. The burden of evidence thus lay on petitioners to prove that they acquired the cables lawfully but this they failed to discharge. among other things. he was relieved of his position and reassigned as company custodian.

For a valid termination of employment on the ground of abandonment. having understood that the removal of his name from the logbook amounted to the termination of his employment. one of the just causes for an employer to terminate an employee. petitioner discovered that his name had been removed from the company logbook and was prevented from logging in. for illegal dismissal. the employer bears the burden of proof. Denying petitioner’s charge that his services were illegally terminated. On to Lucinario’s claim that petitioner abandoned his employment: It is axiomatic that in a petition for review on certiorari. hence. He thereupon exerted efforts to communicate with Lucinario on the status of his employment. yet she ordered petitioner’s reinstatement. addressed to Lucinario. however. he discovered that his name was erased from the logbook. filed a complaint against B&B Fish Broker and/or Lucinario. Arielle Penaranda. tried to confer with Lucinario but to no avail. To the Court. It is a hornbook precept that in illegal dismissal cases. Parenthetically. in effect. Lucinario must prove. He later applied for a 4-day leave of absence. The NLRC found otherwise – that petitioner was illegally dismissed. documentary evidence relating thereto. The following day petitioner. the bulk of his (Lucinario’s) evidence relates to petitioner’s incurring of shortages in his collections to justify the transfer of petitioner’s assignment from cashier to company custodian and his alleged previous suspension. the Labor Arbiter ruled that there is no illegal dismissal. Lucinario. after being informed of his alleged shortages in collections and despite his relegation to that of company custodian. failed to establish any overt act on the part of petitioner to show his intention to abandon employment. LABOR RELATIONS Atty. underpayment and non-payment of wages with prayer for reinstatement. however. And he was informed that his application for a four-day leave of absence had been denied. While Lucinario contends that petitioner abandoned his job. by substantial evidence. Abandonment is a form of neglect of duty. these circumstances do not indicate abandonment. which could lend light on petitioner’s performance. On appeal. petitioner filed an application for a four-day leave effective on even date due to an inflamed jaw. Lucinario claimed. His application. As reflected above. Subsequently. On his return. the appellate court reversed the findings of the NLRC. and learned that his application for a 4-day leave was not approved. the concurrence of petitioner’s failure to report for work for no valid reason and his categorical intention to discontinue employment. The rule admits of certain exceptions. In the present case. was received by a co-employee. Issue: Whether or not Petitioner was illegally dismissed? Ruling: The petition is impressed with merit. before the Arbitration Branch of the National Labor Relations Commission. petitioner. This constrains the Court to reassess the evidence of the parties. but to no avail. Page 190 . was refused entry into the company premises. was not presented. that petitioner abandoned his job. Jefferson M. only questions of law may be raised. still reported for work. one of which is when there is variance on the appreciation of facts of the case. Marquez After a few days.

No. Marquez Finally. Jefferson M. actual and real. Respondent PAL is a domestic corporation organized and existing under the laws of the Republic of the Philippines. PAL retrenched 5. PAL adopted the retrenchment scheme allegedly to cut costs and mitigate huge financial losses as a result of a downturn in the airline industry brought about by the Asian financial crisis. Prior to the full implementation of the assailed retrenchment program. actual. Any claim of actual or potential business losses must satisfy certain established standards. FASAP filed a Complaint against PAL for unfair labor practice. all of which must concur. serious. Flight Attendants and Steward Association of the Phils vs. (2) That the employer served written notice both to the employees and to the Department of Labor and Employment at least one month prior to the intended date of retrenchment. petitioner having been placed in a position where continued employment was rendered impossible and unreasonable by the circumstances indicated above. are reasonably imminent as perceived objectively and in good faith by the employer. the parties failed to agree on how the scheme would be implemented. However. allowances and backwages of affected FASAP members. Phil Airlines. Issue: Whether or not PAL’s retrenchment scheme was justified Ruling: While it is true that the exercise of this right is a prerogative of management. if already incurred. including more than 1.400 of its cabin crew personnel.R. 40. 178083. The burden falls upon the employer to prove economic or business losses with sufficient supporting evidence. moral and exemplary damages with a prayer to enjoin the retrenchment program then being implemented. 2009. that retrenchment shall be based on the individual employee’s efficiency rating and seniority. or collectively known as PAL cabin crew personnel. are not merely de minimis. there must be faithful compliance with substantive and procedural requirements of the law and jurisprudence. before any reduction of personnel becomes legal. LABOR RELATIONS Atty. On June 1998. illegal retrenchment with claims for reinstatement and payment of salaries. Page 191 . but substantial. Thus PAL unilaterally resolved to utilize the criteria set forth in the Collective Bargaining Agreement in retrenching cabin crew personnel: that is. FASAP and PAL conducted a series of consultations and meetings and explored all possibilities of cushioning the impact of the impending reduction in cabin crew personnel. October 2. What thus surfaces is that petitioner was constructively dismissed. main decision Facts: Petitioner FASAP is the duly certified collective bargaining representative of PAL flight attendants and stewards. that petitioner immediately filed the illegal dismissal complaint with prayer for reinstatement should dissipate any doubts that he wanted to return to work. but there was constructive dismissal. 2008. On June 1998. No actual dismissal might have occurred in the sense that petitioner was not served with a notice of termination.000 of its employees. or if only expected. operating as a common carrier transporting passengers and cargo through aircraft. G. see July 22. These are: (1) That retrenchment is reasonably necessary and likely to prevent business losses which.

PAL failed to comply with the first requirement as in the instant case. PAL failed to substantiate its claim of actual and imminent substantial losses which would justify the retrenchment of more than 1. Clarissa Reduca (Reduca). which prejudiced the tenurial rights of the cabin crew personnel. After writing a letter [of apology about not being able to report the incident immediately]. 2002. respondents filed a petition for certiorari before the CA. Greta dela Hostria. and financial hardship for certain workers. For this reason. This makes the evaluation of each cabin attendant’s efficiency rating capricious and prejudicial to PAL employees covered by it. petitioners called her and asked her to make a letter of admission as a condition for her reemployment. (4) That the employer exercises its prerogative to retrench employees in good faith for the advancement of its interest and not to defeat or circumvent the employees’ right to security of tenure. PAL had implemented its retrenchment program in an arbitrary manner and with evident bad faith. in assessing the overall performance of each cabin crew personnel. the instant petition is GRANTED. and presented the affidavit of supervisor Reduca [containing the incident report]. As to the fourth requirement. Issues: whether Espadero was afforded her right to due process prior to being dismissed from her job. WHEREFORE. Marquez (3) That the employer pays the retrenched employees separation pay equivalent to one (1) month pay or at least one-half (½) month pay for every year of service. As to the fifth requirement. The following day. Page 192 . Aggrieved. (5) That the employer used fair and reasonable criteria in ascertaining who would be dismissed and who would be retained among the employees.R. G. Espadero decided to file a complaint for illegal dismissal before the NLRC. failed to report the incident to her supervisor. the company issued a Memorandum terminating her for violation of Rule 24 of the company rules and regulations. were made known to Espadero before and upon her actual employment as cashier. and. October 2. whichever is higher. physical fitness. Letran. Espadero discovered that her time card was already punched in.400 of its cabin crew personnel. the NLRC reversed the Labor Arbiter’s findings. they conducted an impartial investigation of the incident and found substantial evidence that Espadero was in cahoots with a co-worker in punching in her time card. Labor Arbiter declared petitioners liable for illegally terminating Espadero. 2002. petitioners decided to terminate her. she found out that a certain Joselito Cahayagan was the one who punched in her time card. PAL only considered the year 1997. such as status. 41. 2001 as cashier. She claimed that on November 21. Upon appeal. age. LABOR RELATIONS Atty. When she reported for duty. that contrary to her claim. No. who rendered a ruling affirming the Labor Arbiter’s pronouncement that Espadero was not afforded due process. who reported the incident to the personnel manager. Espadero contended that she was dismissed outright without being given ample opportunity to explain her side. Espadero. on November 22. After asking around. however. petitioners gave Espadero ample opportunity to explain her side. seniority. 179507. as well as the corresponding penalties in case of violation thereof. The appellate court also observed that the punishment of dismissal was too harsh and unjustified. Espadero was told to wait for an assignment. efficiency. Jefferson M. Because of this. Eats-Cetera Food Services Outlet v. 2009 Facts: Espadero had been employed by Eats-cetera Food Services Outlet since June 30. Petitioners maintained that – the company rules and regulations.

is one that requires a high degree of trust and confidence. SUBSTANTIVELY. A POSITION OF TRUST AND CONFIDENCE . fraud and willful breach of trust among the just causes for termination. but the dismissal must be for a just or authorized cause as provided by law. the following standards of due process shall be substantially observed: For termination of employment based on just causes as defined in Article 282 of the Labor Code: A written notice served on the employee specifying the ground or grounds for termination. But prior to termination on such grounds. grounds have been established to justify his termination. Ruling: Article 282 of the Labor Code includes – serious misconduct. Not only must the employee be afforded a reasonable opportunity to be heard and to submit any evidence he may have in support of his defense. Jefferson M. to wit: SEC. as personnel manager. and that her infraction reasonably taints such trust and confidence reposed upon her by her employer. indicating that upon due consideration of all the circumstances. 2. issued a Memorandum stating with clarity the reason for Espadero’s dismissal. we also sustain petitioners’ reasoning that – Espadero’s position as a cashier . Rule I of the Implementing Rules of Book VI of the Labor Code. present his evidence. THE PROCEDURAL REQUIREMENTS are set forth in Section 2(d).has been defined as one – where a person is entrusted with confidence on delicate matters. x x x. or Page 193 . Petitioners complied with the second notice requirement. LABOR RELATIONS Atty. and giving said employee reasonable opportunity within which to explain his side. with the assistance of counsel if he so desires is given opportunity to respond to the charge. x x x x (d) In all cases of termination of employment. Greta dela Hostria. or rebut the evidence presented against him. A written notice of termination served on the employee. Marquez whether Espadero’s infraction was serious enough to warrant the penalty of dismissal. A hearing or conference during which the employee concerned. Security of Tenure. the employer must satisfy both substantive and procedural due process.

and whether Espadero was or was not .has ample reason to distrust him.the tampering of her time card. National Labor Relations Commission. In one case. is that . must be of such a grave character and not merely trivial or unimportant. or that his employer . Her failure to promptly report the incident reflects a cavalier regard for the responsibility required of her in the discharge of the duties of her position. very likely. Whether her failure was deliberate . it must be in connection with the employee’s work. Moreover. It is enough that there be “some basis” for such loss of confidence or that “the employer has reasonable grounds to believe.as a ground for dismissal – does not entail proof beyond reasonable doubt of the employee’s misconduct. willful in character. the peculiar nature of Espadero’s position aggravates her misconduct. Jefferson M. With the degree of trust expected of Espadero. The rule. could have been discovered at a much later period. we explained: LOSS OF CONFIDENCE . if it had not been reported by Espadero’s supervisor . Marquez with the custody. or. the Court upheld the validity of the dismissal of a school cashier despite her 19 years of service after evidence showed that – there was a discrepancy in the amount she was entrusted to deposit with a bank. cannot be blamed for losing their trust in Espadero. she failed to report to her immediate supervisor .if there is sufficient evidence to show that – the employee occupying .is guilty of a breach of trust. Petitioners. To constitute just cause for termination.in cahoots with a co-worker. or care and protection of the employer’s property and/or funds. A cashier is a highly sensitive position which requires absolute trust and honesty on the part of the employee. at least. It is for this reason that the Court has sustained the dismissal of cashiers who have been found to have breached the trust and confidence of their employers. a dereliction of duty. if not to entertain the moral conviction[. the labor tribunal cannot justly deny the employer . In the instant case. therefore. Page 194 . the fact remains that . In Metro Drug Corporation v.] that the employee concerned is responsible for the misconduct and that the nature of his participation therein rendered him absolutely unworthy of the trust and confidence demanded by his position. to be serious. and implies wrongful intent and not mere error in judgment. One such position is that of a cashier. not have been known by petitioners. As an employee occupying a job .a position of trust and confidence . LABOR RELATIONS Atty. MISCONDUCT has been defined as improper or wrong conduct. the transgression of some established or definite rule of action.the authority to dismiss such employee. such infraction can hardly be classified as one that is trivial or unimportant.or due to sheer negligence. petitioners cannot be faulted for losing their trust in Espadero.which requires utmost fidelity to her employers. handling.the tampering was not promptly reported and could. The misconduct.to the personnel manager. therefore. a forbidden act.

” (b)Yes. which Plantation Bay found unsatisfactory hence. 182216. Dubrico. Issue: 1. they were dismissed. No. Plantation Bay conducted surprise random drug tests on 122 unsuspecting victims. Respondents Romel Dubrico. . Issued on 09/29/04 at 3:57 p.m. by giving the opposing party sufficient opportunity to meet and rebut the new or additional evidence introduced. Technical rules of procedure are not strictly adhered to in labor cases. NLRC reversed saying there was illegal dismissal and that respondents were not really using drugs! CA affirmed NLRC decision based on evidence which showed a discrepancy between the tests conducted by Phil. (a) NLRC did not err. Jefferson M. Plantation Bay objected to the employees’ questioning the veracity of the tests only in the NLRC Motion for Recon. vs. 2. The tests were done with the assistance of PNP SOCO (scene of the crime operations) with 2 labs conducting the tests: (1) MARTELL drug lab administered the initial tests and (2) PHIL. provided due process is observed. Technical rules of procedure are not strictly adhered to in labor cases consistent with the Constitutional mandate to afford protection to labor.errr. Ruling: Petition is bereft of merit. December 4. et al. Page 195 . Godfrey Ngujo Urine sample received on 09/29/04 at 5:24 p. Illegal dismissal. G. Such move is proper.employees. “The NLRC did not err in considering the issue of the veracity of the confirmatory tests even if the same was raised only in respondents’ Motion for Reconsideration of its Decision. new or additional evidence may be introduced on appeal before the NLRC. Issued on 09/29/04 at 3:57 p. DRUG SCREENING LAB conducted the confirmatory tests. In the interest of substantial justice. they submitted their explanations on the results of the tests. In compliance with several memoranda. as was the case here. Whether or not there was illegal dismissal on the part of Plantation Bay. Plantation Bay failed to prove that employees used drugs based on the doubtful test results. 2009 Facts: In compliance with RA 9165 (Comprehensive Dangerous Drugs Act). Additionally. . Exhibit A (Note that the confirmatory test showed earlier results that the initial test LOL) Name Drug Test Confirmatory Test Romel Dubrico Urine sample received on 09/29/04 at 5:14 p. LABOR RELATIONS Atty. Petition likewise fails on the merits. and if the results turned out to be questionable or erroneous.m. Marquez 42. Labor Arbiter found them guilty of serious misconduct and ruled that there was no illegal dismissal. Drug and Martell. it being crucial in determining the validity of respondents’ dismissal from their employment. they relied on the results of the random drug tests undertaken by an accredited and licensed drug testing facility. they should not be made liable therefor.R. Plantation Bay Resort and Spa.m. Godfrey Ngujo and Julius Villaflor were among 21 employees found positive for use of methamphetamine hydrochloride (shabu).m. Whether or not the NLRC erred in considering the new issue on the veracity of the tests conducted. an issue not raised during the proceedings. they maintain that in terminating the services of respondents. .

make-up. the Petition is DENIED. NLRC made a JOINT DECISION regarding the regularization and the illegal dismissal case. Labor Arbiter upheld the validity of ABS-CBN's contracting out of certain work or services in its operations. WHEREFORE. and several money claims. messengerial. were dismissed by ABSCBN. not independent contractors. differential. regular employees. personal assistants. and they were not entitled to regularization in these one (1) month’s salary for every year of service.m.m. Page 196 . and are entitled to the benefits and privileges of regular employees. It then decided to from its coverage as ABS-CBN considered them temporary and not course through legitimate service contractors all driving. Jefferson M. editors. They also prayed for an award of moral damages and attorney’s fees. 43. ABSCBN appealed the above decision to the NLRC.R. should have been recognized as regular employees entitled make them more economically viable. G. the law considers the case a matter of illegal dismissal. and VTR editors. they were dismissed because they belonged regular employees. to improve its operations and to therefore. night shift to a job category that had already been contracted out. petitioners regularization. unfair labor practice. They asked that they be paid overtime. In defense. ABSCBN appealed such decision to the NLRC. 183810. cameraman. They claimed they janitorial. and rest day and service incentive leave pay. Metro Manila and provincial stations. wardrobe and security services for both the had already rendered more than a year of service in the company and. Where there is no showing of a clear. capacities. undertaken a comprehensive review of its existing organizational File Employees Union executed a CBA where they had been excluded structure to address its operational requirements. The first one is with regards to the regularization of the petitioners while the second one is with regards to the illegal dismissal of such petitioners REGULARIZATION CASE ILLEGAL DISMISSAL CASE Petitioners filed two separate complaints against ABSCBN for While the appeal of ABSCBN to the NLRC was PENDING. valid and legal cause for termination. ABS-CBN Broadcasting Corporation. utility. Fulache v. teleprompters. Petitioners were drivers. No. LABOR RELATIONS Atty. Labor Arbiter rendered a decision holding that the petitioners were regular employees of ABS-CBN. ABS-CBN alleged that even before the labor arbiter rendered his decision in the regularization case. Marquez Julius Villaflor Urine sample received on 09/29/04 at 5:32 p. it had already The petitioners alleged that ABS-CBN and the ABS-CBN Rank-and. Labor Arbiter awarded them separation pay of camera talents. 2010 Facts: Involved in this case are two separate cases. January 21. The burden is on the employer to prove that the termination was for a valid and legal cause. as drivers. holiday. The labor arbiter found that ABS-CBN alleged that the petitioners’ services were contracted on petitioners had been dismissed due to redundancy. Issued on 09/29/04 at 4:15 p. Petitioners were not singled out to security of tenure and to the privileges and benefits enjoyed by for dismissal. in violation of the Labor Code. an authorized various dates by its Cebu station as independent contractors/off cause under the law.

Jefferson M. LABOR RELATIONS Atty. the petitioners. Marquez NLRC ruled that there was an employer-employee relationship NLRC reversed the labor arbiter’s ruling in the illegal dismissal case. were declared legally dismissed due to redundancy. while recognized as entitled to the benefits and privileges of regular employees. they cannot be considered contractual employees since they were not paid for the result of their work. but on a monthly basis and were required to do their work in accordance with the company’s schedule. Petitioners and ABSCBN both filed for a MOTION FOR RECONSIDERATION of the above decision before the NLRC. it between the petitioners and ABS-CBN as the company exercised found that petitioners had been illegally dismissed and awarded them control over the petitioners in the performance of their work. NLRC stood by the ruling that the petitioners were regular employees On the illegal dismissal case. Issue:/S: Whether or not petitioners were regular employees of ABSCBN? Whether or not petitioners were illegally dismissed by ABSCBN? Ruling: REGULARIZATION CASE ILLEGAL DISMISSAL CASE Page 197 . regular employees. the backwages and separation pay in lieu of reinstatement. petitioners were regular employees because they were engaged to perform activities usually necessary or desirable in ABS-CBN's trade or business.

On February 13. by law. 2004. ABS-CBN appealed the decision and maintained its position that the petitioners were independent contractors.. Marquez Supreme Court agreed with the earlier decisions that petitioners were The termination of employment of the four drivers occurred under indeed regular employees of ABSCBN. of law and contract. respondent Bartolome announced that petitioner was to resign from the respondent company. The records show that the regularization case was in fact the As regular employees.R. with a compensation package of Ninety Thousand Pesos (P90. to the surprise of petitioner. On February 2. as well as moral damages for the attendance of bad faith in such dismissal. Jefferson M. clearly disregarding its own appeal then pending with the NLRC. Destiny Financial Plans Inc. petitioner submitted his letter of explanation to respondent company. Petitioners were likewise illegally dismissed and are thus entitled to reinstatement. a pre-need insurance company. No. Feb. the petitioners fall within the coverage of the root of the resulting bad faith as this case gave rise and led to the bargaining unit and are therefore entitled to CBA benefits as a matter dismissal case. G. 2004. 179702. Thus. Petitioners are regular employees of ABSCBN and they are thus entitled to the benefits under the CBA.. ABS-CBN fell into a downward spiral of irreconcilable legal positions. Page 198 . the company cited redundancy as its authorized cause but offered no justificatory supporting evidence. the regularization case was filed leading to the labor arbiter’s decision declaring the petitioners to be regular employees. 2004. On February 17. respondent Bartolome. can only be terminated for the just and authorized causes defined under the Labor Code. It similarly forgot that an exercise of management prerogative can be valid only if it is undertaken in good faith and with no intent to defeat or circumvent the rights of its employees under the laws or under valid agreements. on March 16. and the operations director of the company. Present at the meeting were petitioner. Inc. 16. It merely claimed that it was contracting out the petitioners’ activities in the exercise of its management prerogative. asking him to explain within forty-eight (48) hours why his services should not be terminated for loss of confidence in his ability to perform the functions of Marketing Director of the company. 2010 Facts: On December 1. respondent Bartolome made several announcements. In the course of this appeal. petitioner received a letter from respondent company. ABS-CBN forgot labor law and its realities. it impliedly admitted that the petitioners were regular employees whose services. 2002. 2004.00) a month. various leaders of the marketing team. respondent Destiny Financial Plans. During the meeting. et al. backwages. The dismissal was clearly attended by bad faith. hired petitioner as Head of its Marketing Group. It forgot that by claiming redundancy as authorized cause for dismissal. attorney’s fees. the board of directors of respondent company terminated petitioner’s services on the ground of loss of confidence. Ancheta vs. a Marketing Committee meeting was called by respondent Arsenio Bartolome (Bartolome) at the conference room of respondent company. However. 44. First. PETITION GRANTED. To justify the termination of service. On February 11. highly questionable circumstances and with plain and unadulterated bad faith.000. LABOR RELATIONS Atty. ABS-CBN took matters into its own hands and terminated the petitioners’ services. 2004.

Marquez petitioner filed before the Labor Arbiter a complaint for illegal dismissal. affirming with modification the decision of the NLRC. The power to dismiss an employee is a recognized prerogative inherent in the employer’s right to freely manage and regulate his business. for the law provides that he may be dismissed for cause. In this case. The law. among others. the company could have collapsed. Page 199 . as admitted by petitioner. Under Article 282(c) of the Labor Code. In order to constitute a just cause for dismissal. Petitioner was a managerial employee of respondent company. with prayer for reinstatement. the act complained of must be "work-related" such as would show the employee concerned to be unfit to continue working for the employer. (4) it must be genuine. The SC agrees to CA that private respondents did not strictly comply with the “two notice” requirement in dismissing petitioner Ancheta. Petitioner’s inability to perform the functions of his office to the satisfaction of his employer and the former’s poor judgment as marketing head caused the company huge financial losses. of the over-all production and sales performance of the company. the Labor Arbiter rendered a Decision in favor of petitioner Ancheta. Petition Denied. taking into account the relevant circumstances. Thus. illegal. If these were not timely addressed and corrected. an employer can terminate the employment of the employee concerned for "fraud or willful breach by an employee of the trust reposed in him by his employer or duly authorized representative. thus. even as petitioner Ancheta had yet to answer and air his side. such as the custody. authorizes neither oppression nor self-destruction of the employer. payment of full backwages. as a just cause for termination of employment. National Labor Relations Commission (NLRC) reversed the decision of the Labor Arbiter. and (2) the employee must be given an opportunity to be heard and to defend himself. demanded the return of the Executive elevator key which allows petitioner Ancheta access to the office premises and the surrender of the company car assigned to him. trust and confidence. 2005..e. On April 19. employees. is premised on the fact that the employee concerned holds a position of responsibility. and the public in general. i. he was hired because of his expertise in the pre-need industry. (2) it should not be used as a subterfuge for causes which are improper. holding a highly sensitive position. the CA rendered a Decision. Being the Head of the Marketing Group of respondent company. While private respondents sent a show cause letter to petitioner Ancheta. or unjustified. to the detriment of its policy holders. because its earnings depended on the sales of the marketing group. Issue: Whether petitioner’s employment was validly terminated because of loss of confidence. his performance was practically the lifeblood of the corporation. in protecting the rights of the laborers. LABOR RELATIONS Atty. Loss of confidence. and protection of the employer's property and/or funds. against respondent. namely: (1) the dismissal must be for any of the causes expressed in Article 282 of the Labor Code. The position held by petitioner required the highest degree of trust and confidence of his employer in the former’s exercise of managerial discretion insofar as the conduct of the latter’s business was concerned. care. he was in charge. Respondents’ failure to observe due process in the termination of employment of petitioner for a just cause does not invalidate the dismissal but makes respondent company liable for non-compliance with the procedural requirements of due process. Such betrays the fact that the said show cause letter was but a formality and petitioner Ancheta’s dismissal is a foregone conclusion. the same letter precipitately implemented termination procedures. To be sure. Jefferson M. He must be invested with confidence on delicate matters. On April 28. It is thus apparent that private respondents did not comply with the procedural requirements of due process in dismissing petitioner Ancheta. (3) it may not be arbitrarily asserted in the face of overwhelming evidence to the contrary." The doctrine of loss of confidence requires the concurrence of the following: (1) loss of confidence should not be simulated. an employer cannot be compelled to continue with the employment of workers when continued employment will prove inimical to the employer’s interest. and (5) the employee involved holds a position of trust and confidence. handling. moral and exemplary damages. it was not wise for the company to continue his services. not a mere afterthought to justify an earlier action taken in bad faith. 2007. as aptly pointed out by the CA. which he used to head. His dismal performance was causing the company financial losses. The worker's right to security of tenure is not an absolute right. and attorney’s fees. payment of 13th month pay. petitioner filed a petition for certiorari under Rule 65 of the Rules of Court before the CA. His competence and satisfactory performance as head of the marketing group assumed primordial importance for his continued employment in the company. the amount of which is addressed to the sound discretion of the court. Ruling: Two requisites must concur in order that there be a valid dismissal from employment. The violation of petitioner’s right to statutory due process warrants the payment of nominal damages. Aggrieved. stockholders.

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. Belen did not do work for his farm on a regular basis. of the following day. Javellana. the law intends the award of backwages and similar benefits to accumulate past the date of the Labor Arbiter's decision until the dismissed employee is actually reinstated. As it happens. respondent Javellana insisted that he did it for a reason. Belen decided to go home and get some more sleep.. to September 22. Petitioner Belen further alleged that his long and arduous day finally ended at 4:30 a. 1999 Javellana gave him instructions to (a) pick up lime stones in Tayabas. But after just three hours of sleep. 279. filed by petitioner Belen. 2010 Facts: Belen was hired by Javellana as company driver and assigned him the tasks of picking up and delivering live hogs. Javellana claimed.R. Deeply worried that he might not soon get another job. the second is the subject of the present case. the employer shall not terminate the services of an employee except for a just cause or when authorized by this Title.m. but picked up feeds or delivered livestock only on rare occasions when the farm driver and vehicle were unavailable. After being told that the latter would not be back until 4:00 p. 1999 and this warranted his dismissal. .In cases of regular employment.. 181913.000. that he hired petitioner Belen in 1995. Javellana had left. not as a company driver. Regarding petitioner Belen's dismissal from work. Talisay.R. when the Page 200 . Belen asked for a separation pay. but respondent Javellana suddenly blurted out that he was firing Belen from work. An employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages. Petitioner Belen was promptly at the office at 4:00 p. Marquez 45. March 5. Belen intentionally failed to report for work on August 20. on the other hand. But if.m. leaving room for increase up to the date the decision in the case becomes final? Ruling: Article 279 of the Labor Code. When he arrived at 8:20 a. but as family driver. LABOR RELATIONS Atty. Security of Tenure. Bulacan. Jr. and lime stones used for cleaning the pigpens. and (d) pick up a boar at Joliza Farms in Norzagaray.R. 181913 & 182158. as amended by Section 34 of Republic Act 6715 instructs: Art. (c) have the delivery truck repaired. 1999. August 20. feeds. Batangas. respondent Javellana summoned him to the office. this Court has consistently ruled that backwages shall be computed from the time of illegal dismissal until the date the decision becomes final. 2008. as in this case. Jefferson M. reinstatement is no longer possible. he did not accept it. The petition in G. inclusive of allowances. (b) deliver live hogs at Barrio Quiling.m. When Javellana offered him only P5. filed by respondent Javellana. Consequently. vs. questioned the CA's finding of illegality of dismissal while the petition in G. Nos. 2008. 1999. when he was dismissed. Quezon. The Court denied the first with finality in its resolution of September 22. 182158. Belen should be entitled to backwages from August 20. Issue: Does the amount that the Labor Arbiter awarded petitioner Belen represent all that he will get when the decision in his case becomes final or does it represent only the amount that he was entitled to at the time the Labor Arbiter rendered his decision. Clearly.00. G. On August 19.m. the parties filed separate petitions before this Court. challenged the amounts of money claims awarded to him. Belen.

169207. any controversy regarding her dismissal is under the jurisdiction of the Regional Trial Court. Technically the computation of his separation pay would end on the day he was dismissed on August 20. since Belen was entitled to collect backwages until the judgment for illegal dismissal in his favor became final.R. and attorney's fees against WPP and/or John Steedman (Steedman). 2008. On 3 January 2001. Another indicator that she was a regular employee and not a corporate officer is Section 14 of the contract. 1999 when he supposedly ceased to render service and his wages ended. since the monetary awards remained unpaid even after it became final on September 22. vs. WPP Marketing Communications Inc. on the other hand. Marquez judgment for unjust dismissal in G. Mark Webster (Webster) and Nominada Lansang (Lansang). China. is equivalent to one month pay for every year of service. which clearly states that she is a permanent employee — not a Vice-President or a member of the Board of Directors. The First Division of the NLRC reversed the ruling of Arbiter Madriaga. WPP already had one Vice-President in the person of Webster and all five directorship positions provided in the by-laws are already occupied.. 1994 when petitioner Belen began his service. 2008. actual and moral damages. holiday pay. 2008 because of issues raised respecting the correct computation of such awards. Co. Here that would begin from January 31. LABOR RELATIONS Atty. WPP. What is decisive is that the issue of illegal dismissal from which the order to pay monetary awards to petitioner Belen stemmed had been long terminated. Galera's appointment as a corporate officer (Vice-President with the operational title of Managing Director of Mindshare) during a special meeting of WPP's Board of Directors is an appointment to a non-existent corporate office. Webster and Lansang contend that Galera is a corporate officer. GALERA alleged she was verbally notified by private STEEDMAN that her services had been terminated from private respondent WPP. a fraction of six months to be considered as one whole year. This implies that she was not under the disciplinary control of private respondent WPP's Board of Directors (BOD). The Labor Arbiter's Ruling for illegal dismissal and damages in favor of GALERA. A termination letter followed the next day. it is but fair that respondent Javellana be required to pay 12% interest per annum on those awards from September 22. Galera. Inc. On the other hand. service incentive leave pay. to work in the Philippines for private respondent WPP Marketing Communications. a corporation based in Hong Kong. 181913 became final. Galera filed a complaint for illegal dismissal. which should have been the case if in fact she was a corporate officer because only the Board of Directors could appoint and terminate such a corporate Page 201 . Separation pay. here on September 22. Another convincing indication that she was only a regular employee and not a corporate officer is the disciplinary procedure. It matters not that the amounts of the claims were still in question on September 22. filed her complaint before the Labor Arbiter. March 25. 2010 Facts: Petitioner is Jocelyn Galera. No. incentive plan. On December 14.. Jefferson M. Yet it was reversed again by CA. the computation of his separation pay should also end on that date. At the time of Galera's appointment. 2008 until they are paid. Whether WPP illegally dismissed Galera. Chairman-WPP Worldwide and Chief Executive Officer of Mindshare.R. Ruling: Employee.. 46. hence. Corporate officers are given such character either by the Corporation Code or by the corporation's by-laws. But. (WPP). et al. on the belief that she is an employee. Steedman. which states that her right of redress is through Mindshare's Chief Executive Officer for the Asia-Pacific. We agree with Galera. Issue: Whether Galera is an Employee or a Corporate Officer. 13th month pay. Galera. 2000. The 12% interest is proper because the Court treats monetary claims in labor cases the equivalent of a forbearance of credit. Further. G. an American citizen who was recruited from the US by private respondent John Steedman.

23 WPP's acts clearly show that Galera's dismissal did not comply with the two-notice rule. my directive was for you to lead and review all business pitches. AMACC did not give them any salary increase. however. the petitioners failed to obtain a passing rating based on the performance standards. It is obvious [that] confusion existed internally right up until the day of the pitch. on the other hand. AMA Computer College. Marquez officer. G. Most of the staff I spoke with felt they got more guidance and direction from Minda than yourself. The CA dismissed the action for illegal dismissal ruling that under the Manual for Regulations for Private Schools. (2) must have rendered three consecutive years of service. failed to substantiate the allegations in Steedman's letter. including one from Steedman. I believe your priorities are mismanaged. No. Due to this. they were dismissed as their contracts have expired & were not renewed. April 13. You failed to lead and advise on the two new business pitches. presented documentary evidence 22 in the form of congratulatory letters. Page 202 . The recent situation where you felt an internal strategy meeting was more important than a new business pitch is a good example. Webster. six regular semesters or nine consecutive trimesters of satisfactory service) and were still within their probationary period. and (2) the subsequent notice which informs the employee of the employer's decision to dismiss him. they filed a complaint for underpayment of wages. however. As I discussed with you back in July. Since they had not completed three (3) consecutive years of service (i. then they cannot acquire permanent status. Consequently. Despite this. Apart from Steedman's letter dated 15 December 2000 to Galera. The Labor Arbiter ruled that they had been illegally dismissed. those involved sort (sic) Minda's input. WPP's dismissal of Galera lacked both substantive and procedural due process. our agency partners and some clients. In both cases. The law further requires that the employer must furnish the worker sought to be dismissed with two written notices before termination of employment can be legally effected: (1) notice which apprises the employee of the particular acts or omissions for which his dismissal is sought. and Lansang. Steedman. 183572. Jefferson M. not Article 281 of the Labor Code (which prescribes a probationary period of six months) as the LA ruled. Steedman's letter to Galera reads: The operations are currently in a shamble. Thus. which was also part of my directive that you needed to focus on back in July. the NLRC still affirmed the LA’s finding of illegal dismissal on the basis of standards that were only introduced near the end of their probationary period and not at the time of engagement. I do not believe you understand the basic skills and industry knowledge required to run a media special operation. Mercado v. 47.e. Failure to comply with the requirements taints the dismissal with illegality. that is just not acceptable. WPP failed to prove any just or authorized cause for Galera's dismissal. The NLRC affirmed the LA’s decision.R. Galera. a teaching personnel in a private educational institution (1) must be a full time teacher. when AMACC implemented new faculty screening guidelines. For the school year 2000-2001. LABOR RELATIONS Atty. 2010 Facts: Five former faculty members of AMA Computer College in Parañaque City executed individual Teacher’s Contracts for each of the trimesters they were engaged to teach. which contents are diametrically opposed to the 15 December 2000 letter. it observed that the applicable law is Section 92 of the Manual of Regulations for Private Schools (which mandates a probationary period of nine consecutive trimesters of satisfactory service for academic personnel in the tertiary level where collegiate courses are offered on a trimester basis). and (3) such service must be satisfactory before he or she can acquire permanent status. The non-renewal of contract is a valid management prerogative. WPP. There is lack of leadership and confidence in your abilities from within. In your role as Managing Director. In addition. The quality output is still not to an acceptable standard.

Upon the expiration of his contract of employment. the employer has the option not to renew the contract. the employment relationship terminates. six (6) consecutive regular semesters of satisfactory service for those in the tertiary level. glaring and very basic gaps in the school’s evidence still exist. effective for one school year. Marquez Issue: Whether or not the dismissal is valid. Ruling: AMACC failed to prove by substantial evidence that there was just cause for the non-renewal of the petitioners’ contracts. – Subject in all instances to compliance with the Department and school requirements. An employee who is allowed to work after a probationary period shall be considered a regular employee. the probationary employment continues. If the contract is renewed. primarily on the basis of the employee having met the reasonable standards of competence and efficiency set by the employer. usually for another school year. If the contract is not renewed. At the end of this third year. he cannot automatically claim security of tenure and compel the employer to renew his employment contract. the employer may now decide whether to extend a permanent appointment to the employee. the dismissal was illegal. At the end of the school year. Article 281 should assume primacy and the fixed-period character of the contract must give way. While we can grant that the standards were duly communicated to the petitioners and could be applied beginning the 1st trimester of the school year 2000-2001. Again. and nine (9) consecutive trimesters of satisfactory service for those in the tertiary level where collegiate courses are offered on a trimester basis. at the end of that period. the probationary period for academic personnel shall not be more than three (3) consecutive years of satisfactory service for those in the elementary and secondary levels. On the matter of probationary period. particularly considering the teacher’s performance. The common practice is for the employer and the teacher to enter into a contract. Page 203 . the teacher remains under probation. Jefferson M. neither does the evidence show how these standards were applied to the petitioners. the parties may opt to renew or not to renew the contract. Section 92 of these regulations provides: Section 92. The school. Hence. LABOR RELATIONS Atty. If renewed. however. Other than on the period. being simply on probation. cannot forget that its system of fixed-term contract is a system that operates during the probationary period and for this reason is subject to the terms of Article 281 of the Labor Code. the following quoted portion of Article 281 of the Labor Code still fully applies: The services of an employee who has been engaged on a probationary basis may be terminated for a just cause when he fails to qualify as a regular employee in accordance with reasonable standards made known by the employer to the employee at the time of his engagement. we cannot but conclude that in a situation where the probationary status overlaps with a fixed-term contract not specifically used for the fixed term it offers. The exact terms of the standards were never introduced as evidence. For the entire duration of this three-year period. Given the clear constitutional and statutory intents. The Labor Code is supplemented with respect to the period of probation by special rules found in the Manual of Regulations for Private Schools. Probationary Period. this second renewal of the contract for another school year would then be the last year – since it would be the third school year – of probationary employment.

CA reinstated Labor Arbiter’s decision. Pantoja filed a complaint for illegal dismissal against SCA Hygiene for lack of valid cause. 4 but gave them an option to be transferred to posts of equal rank and pay. But Pantoja (and some others offered with transfers ) refused to be transferred of which his services were terminated by reason of redundancy of position. 4 was a business judgment arrived at due to low demand for the production of industrial paper at the time. presenting in evidence Paper Mill Personnel Schedule for Mill No. In International Harvester Macleod. Jefferson M.. was in bad faith trying to circumvent his tenurial security when no substantial reason exist.4 for June. Pantoja interposed that no permanent shutdown of Paper Mill No. ( SCA Hygiene for short). hired Pantoja on March 1987 as back tender taking charge of operations in one of SCA Hygiene’s mill ( Paper Mill No. Issue: Whether or not Pantoja was illegally dismissed Ruling: Pantoja is not illegally dismissed. 163554. NLRC reversed the Arbiter’s decision stating the redundancy program is legally infirm on feigned shutdown of operations. corp. As can be seen. NLRC remain unpersuaded. SCA Hygiene Products Corp. there was a necessity to occasionally run from time to time the machines only for the purpose of maintaining and preserving the same and does not mean that Paper Mill No.4 due to financial difficulties brought about by the low volume of sales and orders for industrial paper products. Labor Arbiter dismissed Pantoja’s complaint stating his rejection of transfer and receipt of the separation pay belie Pantoja’s illegal dismissal. Besides. was presented to prove that there was continuous operation after the shutdown in the year 1999. Inc. Intermediate Appellate Court. No. 4 in 1999 was a business judgment arrived at to Page 204 . Yet. making and distribution of tissue products and industrial paper. 4 continued to be operational.4 was shut down due to low production output. April 23. 2010 Facts: SCA Hygiene Products Corp. Paper Mill No. 4 due to its continuous operation since his termination. on June 2000. Pantoja vs. again. a corporation engaged in sale. Pantoja received a Notice of Transfer offering him a position at Paper Mill No. On appeal by SCA Hygiene. G. July and August 2000. SCA Hygiene did not proceed directly to retrench. the absence of bad faith. On appeal by Pantoja. to our mind. Marquez 48. No evidence. On record. Despite an apparent reason to implement a retrenchment program as a cost-cutting measure.On March 1999.4 to streamline and phase out the company’s industrial paper manufacturing operations in Paper Mill No. LABOR RELATIONS Atty. This.the abolishment of Paper Mill No. 4 resumed its operation in 2000 due to a more favorable business climate. make respondent’s streamlining/reorganization plan illegal because. SCA Hygiene’s right of management prerogative was exercised in good faith. thus.R. is an indication of good faith on respondent’s part as it exhausted other possible measures other than retrenchment. v. thus. Circumstances pointing good faith on SCA Hygiene’s part . however. The resumption of its industrial paper manufacturing operations does not. the determination of the need to phase out a particular department and consequent reduction of personnel and reorganization as a labor and cost saving device is a recognized management prerogative which the courts will not generally interfere with. Giving the workers an option to be transferred without any diminution in rank and pay specifically belie petitioner’s allegation that the alleged streamlining scheme was implemented as a ploy to ease out employees. Pantoja then received separation pay (which was handsomely over and above what was provided by law) and executed a release and quitclaim in the corp’s favor. retrenchment was utilized by respondent only as an available option in case the affected employee would not want to be transferred. the abolishment of Paper Mill No. the employer’s prerogative to bring down labor costs by retrenching must be exercised essentially as a measure of last resort. after less drastic means have been tried and found wanting. did not outrightly dismiss the workers affected by the closure of Paper Mill No. SCA Hygiene. On reconsideration by SCA Hygiene asseverating that on 1999 when Mill No. However. 5 under the same terms and conditions of employment for an anticipated shutdown of Paper Mill No.4). however.

She was transferred to BPI Family Bank in Los Baños.00 pass through her. Laguna Branch in 1996. The corp. was initially employed as Clerk in 1972 at Citytrust Banking Corporation. to expedite his transaction with the bank. would make temporary cash borrowings and would return the money at the end of the day through withdrawals from her own or other clients’ accounts. Azucena added that the same practice was continued by her son. BPI conducted a thorough investigation and discovered that respondent had approved several withdrawals from various accounts of clients whose signatures were forged. She later became Lead Teller. in that the latter. Marquez prevent a possible financial drain at that time. There were times when respondent would fail to return the money withdrawn resulting in shortages on the part of Azucena. In her written response. June 18. Jefferson M. which eventually merged with the Bank of Philippine Islands (BPI). She argued that the posting is done by the teller and only amounts over P150. Work reassignment of an employee as a genuine business necessity is a valid management prerogative. NLRC. the wisdom of a business judgment to implement a cost saving device is beyond this court’s determination. Teotima Helen Azucena (Azucena) was making unauthorized withdrawals. still Pantoja refused the transfer and instead. the waiver represents a valid and binding undertaking.000. BPI v. As long as no arbitrary or malicious action on the part of an employer is shown. Arambulo admitted that she prepared the unsigned withdrawal slips on the account of Mr. accepted the separation pay voluntarily. Emeterio Dikitan. Laguna on 21 November 2001. Amante) totalingP700. she was reprimanded for the improper handling and retention of a client’s account. Her balance reflected an amount less than the actual amount deposited. BPI conducted an investigation and discovered that its bank teller. Azucena implicated respondent. 2003. Laguna Branch requested for a certification of her savings account. even gave Pantoja a separation pay more than what the law requires from respondent. on many occasions. Arambulo. then as Sales Manager. She also explained that she processed the withdrawal slips of Mr. On 26 April 2002. Amante that were supposedly deposited to other depositor’s account.000. LABOR RELATIONS Atty.00 upon request of the latter. A show cause memorandum was served to Azucena asking her to explain the unauthorized withdrawals. a client of BPI-San Pablo. and subsequently. Arambulo was served with notice of termination on the ground of LOSS OF TRUST AND CONFIDENCE for gross violation of policies and procedures. The consideration for the quitclaim is credible and reasonable. Artie Arambulo. Page 205 . Hence. No. with the latter signing later on. Laguna. G. On 4 October 2001. 2010 Facts: Records show that respondent.R. Vicente Amante (Mr. The assistant branch manager of the said branch also imputed fault to Arambulo. as Bank Manager in BPI-San Pablo. She denied any knowledge with regard to the unfunded checks of Mr. 49. BPI conducted a hearing and on January 13. No force and duress attended in its execution. Even though the transfer would not involve any diminution of rank and pay. 179801. When respondent was transferred to Los Baños.

and purposely. However. commission of a crime against the employer or his family. Jefferson M. (Court applied its ruling in Toyota vs NLRC) While as a general rule. or those reflecting on his moral character. fraud or willful breach of trust. willful disobedience. Workers Association v. NLRC reaffirmed the general rule that separation pay shall be allowed as a measure of social justice only in those instances where the employee is validly dismissed for causes other than serious misconduct. it may not be amiss to emphasize that if an employee has been dismissed for a just cause under Article 282 of the Labor Code. The NLRC and CA ruled that respondent’s dismissal for cause in accordance with the law. Issue: WON ARAMBULO IS ENTITLED TO SEPARATION PAY. he is not entitled to separation pay. It is significant to stress that for there to be a valid dismissal based on loss of trust and confidence: the breach of trust must be willful. In the leading case of Philippine Long Distance Telephone Co. The basic premise for dismissal on the ground of loss of confidence is that the employees concerned hold a position of trust and confidence. It was established that respondent had approved withdrawals which were later proven to be forged but ordered the payment of separation pay. the Court stated that separation pay shall be allowed as a measure of social justice only in those instances where the employee is validly dismissed for causes other than serious misconduct or those reflecting on his moral character. In granting separation pay to respondent. v. In the instant case. Verily. Corp. It is Page 206 . These five grounds are just causes for dismissal as provided in Article 282 of the Labor Code. knowingly. Marquez Arambulo filed a complaint for illegal dismissal. the Court has allowed in numerous cases the grant of separation pay or some other financial assistance to an employee dismissed for just causes on the basis of equity. meaning it must be done intentionally. NLRC. Ruling: NO. gross and habitual neglect of duty. respondent was dismissed on the ground of loss of trust and confidence. the succeeding case of Toyota Motor Phils. LABOR RELATIONS Atty. the NLRC and Court of Appeals both adhered to this jurisprudential precept and cleared respondent of bad faith. without justifiable excuse. an employee who has been dismissed for any of the just causes enumerated under Article 282 of the Labor Code is not entitled to separation pay.

July 5. Invoking the pronouncement in Toyota. 50. opened a separate bank account at the Capitol Bank 6 for TBFO's savings. G. there were instances when he used the funds intended for one project to sustain the activities of other projects. through Goyena Solis (Solis). No. Believing he was constructively dismissed by PRRM's actions. 1997. Pulgar no longer reported to work. Rural Reconstruction Movement vs. otherwise the release of TBFO's subsequent funds would be delayed. The case of Aromin v. Pulgar filed a complaint against PRRM on April 3. Pulgar manifested his willingness to attend a meeting with the senior officers. the account had a remaining balance of P206. After the lapse of his last leave on April 15. When Pulgar was reassigned to PRRM's central office. Pulgar tells another tale. he claimed that he had to produce fake receipts to comply with the central office's requirements and deadlines. In said case. Lastly. and April 1-15. 1997. He explained that as field manager. Solis stated that part of the funds allotted to the TBFO was missing or not properly accounted for. conducted an investigation into alleged financial anomalies committed at the TBFO. Pulgar further admitted that some of the receipts he submitted to liquidate TBFO's expenses were not genuine. March 20-25. PRRM maintains that while the investigation was ongoing. 1997. 1997 for illegal dismissal. 1997. leading PRRM to believe that Pulgar had abandoned his work to evade any liability arising from the investigation. According to him. on his own initiative. Thus. 1997. but his letter went unanswered. 1997. scheduled on February 28. placed them in boxes and kept them in storage. he submitted a letter to PRRM to complain that he was not given the right to confront and question Solis.958. Phil. 1997. on March 31. 2010 Facts: Pulgar was the manager of PRRM's branch office — the Tayabas Bay Field Office (TBFO) — in Quezon Province. he was not allowed to enter the premises of the organization. Pulgar admitted that TBFO's reported expenses did not reflect its actual expenses. asking him to explain these findings. illegal Page 207 . the Court disallowed the payment of separation pay on the ground that Aromin was found guilty of willful betrayal of trust. Pulgar also alleges that PRRM's representatives removed his personal properties and records from his office. PRRM. Pulgar also disclosed that he had. PRRM was therefore surprised to learn that Pulgar had filed an illegal dismissal case on April 3. 169227. together with a memorandum. Aromin was the assistant vice-president of BPI when he was validly dismissed for loss of trust and confidence. he presumed he had the discretion to determine when and how the funds would be used. LABOR RELATIONS Atty. to further explain his side. NLRC is in all fours. Pulgar. The report also stated that some of the receipts that the TBFO submitted to liquidate the organization's financial transactions were fictitious and manufactured. Jefferson M. on March 17. Marquez the breach of this trust that results in the employer’s loss of confidence in the employee.R. Pulgar went on leave on March 3-10. a serious offense akin to dishonesty. Thereafter.50. as long as the use was devoted to the implementation of TBFO projects. In her investigation report. The PRRM management sent Pulgar a copy of the report. In a letter dated February 24.

To bolster his contention that he was constructively dismissed. Pulgar also asked for actual damages. Marquez suspension. LABOR RELATIONS Atty. he was still on leave from the organization. The timing and frequency of these leaves. there is nothing in the photographs that proves that the boxes in the storage room even contain Pulgar's personal things. Ruling: No. Pulgar was still its employee when he filed the illegal dismissal case against the organization. But the facts are not as simple as they appear to be. from PRRM's standpoint. Primarily. 1997. then on March 20-25. 1997. we cannot use these pictures to prove that Pulgar was constructively dismissed from employment. 1997. imply Pulgar's active efforts to evade the organization's ongoing investigation. At first glance. The fact alone that Pulgar was able to return to the office to file his application for leave for April 1-15. moral damages. Pulgar claims that he was forced to file an illegal dismissal complaint against PRRM while he was on leave because he was not allowed to enter the office premises on March 31. the CA relied on two main factors: (a) Pulgar's claim that he was barred from entering the premises on March 31. and (b) the fact that Pulgar immediately filed a complaint for illegal dismissal against PRRM. Jefferson M. The CA observed that PRRM presented no evidence to prove that Pulgar abandoned his job. the CA's decision appears correct. we underscore the fact that when Pulgar filed an illegal dismissal complaint on April 3. In concluding that Pulgar was constructively dismissed from employment. In other words. the appellate court concluded that Pulgar had been illegally dismissed. Was he physically prevented from entering the premises by a security guard? Did the senior officers of PRRM refuse to let him into the office when he reported to work? We are left to guess the particulars of how PRRM prevented Pulgar from entering the premises. Issue: Whether or not Pulgar was illegally dismissed from employment. But the only thing seen in these photographs is a storage room with sealed boxes on the floor. Taken at face value. at the very least. and finally on April 1-15. he attached three photographs. 1997. Absent such proof. 1997. 1997 raises doubt as to his purported ban from the premises. Pulgar asserts that his personal things were taken from his office. leaving us to doubt the veracity of this allegation. 1997. We further note that at the time PRRM was conducting an investigation into the alleged anomalies committed in the liquidation and use of PRRM funds at the TBFO during Pulgar's management. But aside from making this allegation. 1997. and attorney's fees. he still filed his application for leave for April 1-15. placed in boxes and put in storage. Page 208 . and nonpayment of service incentive leave pay and 13th month pay. while Pulgar claims he was constructively dismissed when he was barred from the premises on March 31. specifically on March 3-10. To support this allegation. Pulgar failed to provide any other details on how he was prevented from entering the premises. Significantly. Reasoning that filing an illegal dismissal complaint is inconsistent with the charge of abandonment. 1997. Pulgar went on a number of leaves. while not indicative of Pulgar's intention to sever his employment.

While the Constitution is committed to the policy of social justice and the protection of the working class. served twelve (12) set dinners to the guests. Hiyas and waiter Genaro Mission. No. through its Human Resource Development (HRD) Page 209 . lead us to conclude that PRRM did not terminate Pulgar's employment. G. Before the employer must bear the burden of proving that the dismissal was legal. an employee's act of filing an illegal dismissal complaint against his employer is inconsistent with abandonment. Marquez Also worth mentioning is the fact that Pulgar continued to receive his salary from PRRM even after March 31. Captain waiter Hiyas took their dinner orders comprising of six (6) sets of lamb and six (6) sets of fish. if there is no dismissal. petitioner Maribago. The guests paid the amount indicated on the receipt and thereafter left in a hurry. Pulgar received his salary up until April 15. fourteen (14) sets of dinner were prepared by the chef. a group of Japanese guests and their companions dined at Allegro. In view of the discrepancy between the order slip and the receipt issued. Dual. 2010 Facts: Petitioner Maribago is a corporation operating a resort hotel and restaurant in Barangay Maribago. 51. After dinner. in the present case. then there can be no question as to its legality or illegality. we simply cannot use that one act to conclude that Pulgar did not terminate his employment with PRRM. the facts and the evidence do not establish a prima facie case that the employee was dismissed from employment. taken together. Hiyas forwarded one copy of the order slip to the kitchen and another copy to respondent. cannot be given credence. the guests asked for their bill. The receipt printed at 10:40 p. when uncorroborated by the evidence on record. in the present case. Jr. Mission asked respondent Dual for the sales transaction receipt and presented this to the guests. and another two (2) sets to their guides free of charge (total of 14 sets of dinner). Maribago Bluewater Beach Resort v.036. the employee must first establish by substantial evidence the fact of his dismissal from service. Management also has its rights which are entitled to respect and enforcement in the interest of simple fair play. Sometime in 2005. substantial evidence presented by PRRM that proves otherwise. Jefferson M. Since Hiyas was attending to other guests. While we recognize the rule that in illegal dismissal cases. it hired respondent Dual as waiter and promoted him later as outlet cashier of its Poolbar/Allegro Restaurant. however. LABOR RELATIONS Atty. 1997. July 20. Lapu-Lapu City. including those of the employer. As per company procedure. We have previously ruled on the Labor Arbiter's jurisdiction to rule on all money claims. Logically.m. it should not be supposed that every labor dispute will be automatically decided in favor of labor. 180660. These circumstances. the employer bears the burden of proving that the termination was for a valid or authorized cause. when his vacation and sick leaves had been consumed. he gave a signal to Mission to give the bill. Bare allegations of constructive dismissal.R. arising out of the employer-employee relationship. On the contrary.00 was remitted by cashier Dual corresponding to six (6) sets of dinner. In 19953. Although under normal circumstances. Pursuant to the order slip. 1997. shows that – only P3. or the date of his alleged constructive dismissal. In fact. and in the process ignore the clear. what appears from the evidence is that it was Pulgar himself who terminated his employment with PRRM when he filed an illegal dismissal complaint against the organization while he was on leave.

reiterates his story that – the order slip was already altered when Mission gave it to him. He was terminated per memorandum dated 22 January 2005. that Mission gave him P3. illegal dismissal.00 as payment and he returned P64. Alcoseba was also terminated for dishonesty based on his admission that he altered the order slip.00 as change. non-payment of 13th month and separation pay. Finding no sufficient valid cause to justify respondent's dismissal. waiter Alcoseba caused the alteration of the order slip to reflect that six (6) orders were cancelled. that the receipt he printed was based on the order slip for six (6) sets of dinner.on the proven tampering of the transaction receipt which happened in respondent's workstation. on the other hand. Alegrado allegedly asked Alcoseba if the cook was already aware of the cancellation. he is already aware).he saw the cancelled food orders at the waiter's station but insists that . the issue is – whether the Court of Appeals erred in ruling that respondent was illegally dismissed. Jefferson M.. Petitioner places . to which the latter answered "oo. LABOR RELATIONS Atty.he did not have any part in the alteration of the order slip.1 (dishonesty in any nature). issued memoranda. that he was able to confirm the cancellation of some orders from Alcoseba and Hiyas. kahibaw na" (yes. During the clarificatory hearing. Ruling: Page 210 . up to the finality of [its] decision and separation pay of one month salary for every year of service. requiring respondent Dual. During the clarificatory hearing.the crux of the controversy . he admitted that he altered the order slip by cancelling six (6) set dinners. Issue: Whether or not the court of appeals committed a grave and reversible error in reversing the national labor relations commission and directing petitioner to pay respondent full backwages from the time he was illegally dismissed. After the investigation. respondent Dual was found guilty of dishonesty for his fabricated statements and for asking one of the waiters (Mission) to corroborate his allegations. He claims that . 113. and damages. Alvin Hiyas. saying that complainant's act of depriving respondent of its lawful revenue is tantamount to fraud against the company which warrants dismissal from the service. At around 9:45 p. In essence. Marquez manager. butcher Alegrado testified that – waiter Alcoseba went to the butchery looking for the order slip for table no.m. Ernesto Avenido and Basilio Alcoseba to explain why they should not be penalized for violating House Rule 4. Falsification of commercial documents as a means to malverse company funds constitutes fraud against the company. The Court of Appeals reversed the decision and resolution of the NLRC. the Court of Appeals ordered petitioner to pay respondent full backwages and separation pay. Dual filed a complaint for unfair labor practice. Alcoseba stated that – he was not privy to the cancellation of orders since he was busy attending to his room service duty. The Labor Arbiter found that respondent's termination was without valid cause and ruled that respondent is entitled to separation pay. Respondent. The NLRC set aside the Labor Arbiter's decision and dismissed the complaint for lack of merit.100. however.

As established during the clarificatory hearing.00 only and gave Mission P64. These testimonies coincide with the claim of waiters Hiyas and Mission that fourteen (14) sets of dinner were served.has to be countersigned by the attending Page 211 . respondent's claim that . The receipt which bears his name "NITO" was printed at "22:40" (10:40 p.00 as change is not shown by the receipt that he issued. Butcher Alegrado and Dessert-in-charge John Marollano) that twelve (12) set meals were served and consumed. LABOR RELATIONS Atty. If such were the case.100.100.he received P3. twelve (12) sets of dinner were served to guests and two (2) dinner sets were given to the tour guides free of charge.00 as shown by the receipt which he admitted to have issued.036. the order slip . Two other receipts were issued for the same amount at "22:39:55" and "22:40:01". The law further requires that – the burden of proving the cause for termination rests with the employer. then the amount charged to the guests should have been for eight (8) sets of dinner and not six (6) sets.m. Instead of reporting P10. an employee unjustly dismissed from work is entitled to reinstatement and full backwages.to observe due process in termination cases. The law also requires – the employer . The allegation of Dual that . In addition.m.) or 1 hour and 40 minutes after the guests had left at 9:00 p.six (6) dinner sets were indeed cancelled as evidenced by the dishes he allegedly saw in the utensil station is negated by the testimonies of the kitchen staff (Chef Armand Galica. we are in agreement that petitioner's evidence proved that respondent is guilty of DISHONESTY and of stealing money entrusted to him as cashier.violation of the employee's statutory right to due process makes the employer liable to pay indemnity in the form of nominal damages. Otherwise. National Labor Relations Commission. the amount indicated in the receipt does not coincide with Dual's contention that only four (4) dishes were cancelled and two (2) dishes were given free of charge. w In Agabon v.34cralaw we ruled that. Jefferson M.cra35 In this case. The standard operating procedure of Maribago dictates that in cases of cancellation.00 as payment by the guests for their dinner. The issued receipt does not show that – change was given. It is clearly indicated in the altered order slip that six (6) out of the twelve (12) sets of dinner were cancelled. Moreover. respondent cashier only reported P3. Marquez The law requires that – an employer shall not terminate the services of an employee except for a just or authorized cause. The serving of food eliminates the argument of cancellation. The alibi of cancellation has no leg to stand on.

Jefferson M.explain why Dual and Alcoseba tried twice to convince Mission to cover up their crime. The foregoing facts . Respondent's acts constitute SERIOUS MISCONDUCT – which is a just cause for termination under the law. They even asked Mission to take the fall by asking him to admit that he altered the order slip from twelve (12) sets of dinner to six (6) sets. authorizes neither oppression nor self-destruction of the employer. Even if the aforesaid procedure is conducted after the filing of the illegal dismissal case. No. Such fact led us to the conclusion that . has not blinded the Court to the rule that – justice is in every case for the deserving.) and after the alteration of the order slip (9:45 p. New Puerto Commercial vs.) was done. it should not be supposed that every labor dispute will be automatically decided in favor of labor. Procedural due process requires that the employee be given a notice of the charge against him. ACTS OF DISHONESTY . petitioner's income in this case. 52. the law. are a different matter.m.in the handling of company property. In fine. to be dispensed in the light of the established facts and applicable law and doctrine. Marquez waiter (which in this case should have been Chief Waiter Hiyas) but such was not so in this case. the legality of the dismissal. he must be accorded both substantive and procedural due process by the employer. The receipt was issued long after the guests had left (9:00 p. Such favoritism.toward the worker and upheld his cause . however. Out of its concern for those with less privileges in life. THEFT committed by an employee is a valid reason for his dismissal by the employer. what is damning to the cause of Dual . The management also has its own rights.m. as such. an ample opportunity to be heard. July 26. While the Constitution is committed to the policy of social justice and the protection of the working class. Although as a rule this Court leans over backwards to help workers and employees continue with their employment or to mitigate the penalties imposed on them. will be upheld provided that the employer is able to show that compliance with these requirements was not a mere afterthought.” Page 212 . Withal.in his conflicts with the employer. G.is the receipt which he admittedly issued. as to its procedural aspect.R. and a notice of termination.he consented to and participated in the anomaly. are entitled to respect and enforcement in the interest of simple fair play. in protecting the rights of the laborers. 169999. the Supreme Court has inclined more often than not . Lopez. 2010 “In order to validly dismiss an employee. LABOR RELATIONS Atty.

When the requirements of procedural due process are satisfied. National Labor Relations Commission Ruling: The petition is meritorious. to wit. Philippine Telegraph and Telephone Company: An employee's right to be heard in termination cases under Article 277 (b) as implemented by Section 2 (d). the complaint was endorsed for compulsory arbitration at the RAB of the NLRC. and not necessarily that an actual hearing was conducted. a conciliation conference was held but the parties failed to reach an amicable settlement. respondents filed a Complaint for illegal dismissal and non-payment of monetary benefits against petitioners with the Regional Office of the DOLE in Puerto Princesa City. Jefferson M. petitioners sent respondents notices to explain why they should not be dismissed for gross misconduct based on (1) the alleged misappropriation of their sales collections. In 2000. It is satisfied not only by a formal face to face confrontation but by any Page 213 . 2000. The employer must furnish the employee with two written notices before the termination of employment can be effected: (1) the first apprises the employee of the particular acts or omissions for which his dismissal is sought. It ruled that damages cannot be awarded in favor of respondents because their dismissal was for just causes. Previously or on November 28. and (2) the second informs the employee of the employer's decision to dismiss him. Under a rolling store scheme. 2000. The NLRC affirmed the ruling of the Labor Arbiter. As we explained in Perez v. it awarded nominal damages of P30. Respondents refused to attend said hearing. LABOR RELATIONS Atty. The notice also required respondents to appear before petitioners' lawyer on December 2. petitioners served notices of termination on respondents on the grounds of gross misconduct and absence without leave for more than one month. and (2) their absence without leave for more than a month. petitioners assigned respondents to sell goods stocked in a van on cash or credit to the sari-sari stores of far-flung barangays and municipalities outside Puerto Princesa City. Rule I of the Implementing Rules of Book VI of the Labor Code should be interpreted in broad strokes. Respondents were duty-bound to collect the accounts receivables and remit the same upon their return to petitioners' store on a weekly basis. The Labor Arbiter dismissed the complaint for illegal dismissal. 2000 to give their side with regard to the foregoing charges. The requirement of a hearing is complied with as long as there was an opportunity to be heard. petitioner New Puerto Commercial hired respondents Felix Gavan and Rodel Lopez as a delivery panel driver and as a roving salesman. As a result. Issue: Whether the respondents were denied procedural due process justifying the award of nominal damages in accordance with the ruling in Agabon v.000. Marquez Facts: In 1999. In termination proceedings of employees. 2000. respectively. Palawan. the award of nominal damages is improper. On November 20. On December 18. procedural due process consists of the twin requirements of notice and hearing.00 each to petitioners because they were denied due process. The CA affirmed with modification the ruling of the NLRC.

LABOR RELATIONS Atty. Artificio was employed as security guard by respondent RP Guardians Security Agency.R. under the peculiar circumstances of this case. A hearing means that a party should be given a chance to adduce his evidence to support his side of the case and that the evidence should be taken into account in the adjudication of the controversy. Bagasala returned from his month-long investigation in the far-flung areas previously serviced by respondents and reported that respondents indeed failed to remit P2. As can be seen. On 25 July 2002. submissions or pleadings. by itself. 2000. there was sufficient compliance with the twin requirements of notice and hearing even if the notices were sent and the hearing conducted after the filing of the labor complaint. 2000. G. Artificio had a heated argument with a fellow security guard. then at the time of the filing of the complaint with the labor office on November 3. 2000 for respondent Gavan. there was. petitioners served notices of termination on respondents for gross misconduct in misappropriating their sales collections and absence without leave for more than a month. petitioners initiated an investigation by sending one of their trusted salesmen. Thus. NLRC.e. respondents were temporarily reassigned to a new route to service. although preferred. Merlino B. no necessity to comply with the twin requirements of notice and hearing. on November 28. Sometime in the third week of October 2000. The mere fact that the notices were sent to respondents after the filing of the labor complaint does not. on December 18. Jefferson M. Sometime in June 2002. For this reason. termination proceedings were commenced against respondents by sending notices to explain with a notice of hearing scheduled on December 2. respondents filed the subject illegal dismissal case to pre-empt the outcome of the ongoing investigation.. Inc. Prior to this point in time. 2000 for respondent Lopez and October 28.257. Thereafter. Subsequently. 2000. As narrated earlier. It was duly established. Edu submitted a Page 214 . On November 18. 53. In other words. July 26. No. formal "trial-type" hearing. as affirmed by the appellate court itself. 2000 but respondents again refused to attend. 2000 to attend a hearing on December 15. Petitioners sent another set of notices to respondents on December 7. the award of nominal damages by the appellate court is improper. Artificio vs. respondents were not yet dismissed from employment. petitioners received information that respondents were not remitting their sales collections to the company. 2000. Therefore. in the route being serviced by respondents. "To be heard" does not mean verbal argumentation alone inasmuch as one may be heard just as effectively through written explanations. 2000. thus. Edu (Edu). Thus. Bagasala. it cannot be concluded that the sending of the notices and setting of hearings were a mere afterthought because petitioners were still awaiting the report from Bagasala when respondents pre-empted the results of the ongoing investigation by filing the subject labor complaint. Marquez meaningful opportunity to controvert the charges against him and to submit evidence in support thereof. 2010 Facts: Petitioner Jose P. starting from October 22.. respondents failed to give their side despite receipt of said notices. The surrounding circumstances of this case adequately explain why the requirements of procedural due process were satisfied only after the filing of the labor complaint. while the phrase "ample opportunity to be heard" [in Article 277 of the Labor Code] may in fact include an actual hearing. 2000 for respondent Gavan) after they got wind of the fact that they were being investigated for misappropriation of their sales collection. 172988. it is not limited to a formal hearing only. establish that the same was a mere afterthought. that respondents failed to report for work starting from October 22. is not absolutely necessary to satisfy the employee's right to be heard. on November 3. 2000 for respondent Lopez and October 28. and. a corporation duly organized and existing under Philippine Laws and likewise duly licensed to engage in the security agency business. 2000.03 in sales collections. the existence of an actual. respondents stopped reporting for work (i. As a result. To prevent a possible cover up.

and damages. Yes. illegal suspension. he is entitled to limited backwages and separation pay. His continued presence in respondents' or its client's premises poses a serious threat to respondents. Artificio's preventive suspension was justified since he was employed as a security guard tasked precisely to safeguard respondents' client. and threatened to "arson" their office. Jefferson M. he is entitled to backwages and separation pay Ruling: 1. Andres issued a Memorandum temporarily relieving Artificio from his post and placing him under preventive suspension pending investigation for conduct unbecoming a security guard. requesting that Artificio be investigated for maliciously machinating Edu's hasty relief from his post and for leaving his post during night shift duty to see his girlfriend at a nearby beerhouse. 13th month pay. In another memorandum. 10 Labor Arbiter rendered a decision dated 6 October 2003. He also prayed for payment of separation pay in lieu of reinstatement. Since the complainant does not seek reinstatement. Andres (Andres). Marquez confidential report 5 to Antonio A. It was also held that Artificio should have been allowed to confront Edu and Err before he was preventively suspended. finding respondents guilty of illegal suspension and dismissal. preventive suspension is not proper. abandonment of post during night shift duty. and submit his written answer immediately upon receipt of the memorandum. Inc. non-payment of overtime pay. Artificio filed on 5 August 2002. light threats Page 215 . light threats and irregularities in the observance of proper relieving time. under the influence of liquor. Without waiting for the hearing to be held. holiday pay. on 25 June 2002. On 29 July 2002. LABOR RELATIONS Atty. The motion for reconsideration filed by Artificio was denied for lack of merit Artificio next filed a petition for certiorari before the Court of Appeals which rendered a decision affirming the NLRC decision. Gutierrez Err (Err). Sections 8 and 9 of Rule XXIII. Inc. Artificio filed a motion for reconsideration which the Court of Appeals again denied. Wether or not Petitioner Artificio's preventive suspension was justified 2. its employees and client in light of the serious allegation of conduct unbecoming a security guard such as abandonment of post during night shift duty. premium pay for holiday and rest days. Without this kind of threat. a complaint for illegal dismissal. such as. Issues: 1. Inc. Implementing Book V of the Omnibus Rules Implementing the Labor Code provides that preventive suspension is justified where the employee's continued employment poses a serious and imminent threat to the life or property of the employer or of the employee's co-workers. he bad- mouthed the employees of RP Guardians Security Agency. When Artificio learned that no salaries would be given that day. Administration & Operations Manager. On appeal. another security guard. Whether or not. the NLRC. In this case. Andres informed Artificio that a hearing will be held on 12 August 2002. He also directed Artificio to report to the office of RP Guardians Security Agency. On even date. sent a report 6 to Andres stating that Artificio arrived at the office of RP Guardians Security Agency. set aside the decision of the Labor Arbiter ruling that the Labor Arbiter erred in considering preventive suspension as a penalty.

Yes for Backwages. That resolved. Artificio would even reject reinstatement revealing his bent to have his own way through his own means. Artificio himself has never. they were not paid any wage due to Page 216 . 2010 Facts: On July 16.00 even during holidays. This Court has upheld a company's management prerogatives so long as they are exercised in good faith for the advancement of the employer's interest and not for the purpose of defeating or circumventing the rights of the employees under special laws or under valid agreements. for work performed on Sundays. As aptly noted by the NLRC. they were not given any specific work assignment. 20 Significantly. that Artificio had been working with the company for a period of sixteen (16) years and without any previous derogatory record. Having determined that the imposition on Artificio of preventive suspension was proper and that such suspension did not amount to illegal dismissal. 54. he avoided the investigation into the charges by filing his illegal dismissal complaint ahead of the scheduled investigation. Jefferson M. 1999. overtime pay.m. Artificio preempted the investigation that could have afforded him the due process of which he would then say he was denied. He. 22 Artificio is entitled to separation pay considering that while reinstatement is an option. for work rendered from Mondays to Saturdays beyond the normal eight (8) working hours in a day. No for separation pay. they performed various kinds of work imposed upon them by Lee. Calipay vs. at anytime after the notice of preventive suspension intended to remain in the employ of private respondents. non-payment of service incentive leave pay. they were paid a uniform daily wage in the amount of P140. Marquez and irregularities in the observance of proper relieving time. August 3. in discharging their functions. premium pay for holiday. they were required by Lee to work for nine (9) hours a day. Besides. underpayment of wages and 13th month pay. and ending at 6:00 p. night shift allowances and separation pay was filed by herein petitioner Elpidio Calipay. 2. we next proceed to the benefits due Artificio. unfair labor practice. No. on his own decided that his preventive suspension was in fact illegal dismissal and that he is entitled to backwages and separation pay.R. they were also required to report from Monday to Sunday. Artificio regrettably chose not to present his side at the administrative hearing scheduled to look into the factual issues that accompanied the accusation against him.m. with a break of one hour at 12:00 noon. together with Alfredo Mission and Ernesto Dimalanta against herein private respondents Triangle Ace Corporation (Triangle) and Jose Lee. a Complaint 3 for illegal dismissal. Calipay and the other complainants alleged in their Position Paper that in the course of their employment. Nonetheless. Indeed. namely. 166411. NLRC. we see no basis for the grant of backwages. Management has the prerogative to discipline its employees and to impose appropriate penalties on erring workers pursuant to company rules and regulations. In fact. G. given the attendant circumstances in this case. LABOR RELATIONS Atty. the ends of social and compassionate justice would be served if Artificio be given some equitable relief in the form of separation pay. beginning from 7:00 a. rest day.

Marquez the policy of Lee that his workers must provide work without pay at least a day in the week under his so-called "bayanihan system". It was further alleged that in May 1998. Lee scolded Calipay and Mission. however. private respondents were able to present the DTRs and Salary Vouchers of Calipay and the other complainants showing that they indeed reported for work even after their alleged termination from employment. On the other hand. they were forced to sign a blank form of their daily time records and salary vouchers. the instant petition of Calipay raising the following issues: Issue: Whether or not there was abandonment of work a just ground for dismissal Held: Calipay and the other complainants failed to sufficiently refute these findings of the Labor Arbiter in their appeal filed with the NLRC. Appealed to CA which rendered its Decision dismissing the petition. petitioner filed his complaint more than one year Page 217 . as held by the Labor Arbiter. Calipay filed a Motion for Reconsideration. more so if the same is accompanied by a prayer for reinstatement. private respondents filed a Motion for Reconsideration was Given due course and the decision of the Labor Arbiter was reinstated and affirmed. Aggrieved. Lee confronted Calipay and Mission regarding their alleged participation and assistance in Dimalanta's claim for disability benefits with the Social Security System. 26 Calipay and the other complainants also failed to present evidence to prove their allegation that they were forced to sign blank forms of their DTRs and Salary Vouchers. but the CA denied Hence. but the same was denied by the NLRC. Calipay and the other complainants filed an appeal with the National Labor Relations Commission (NLRC) modifying the Labor Arbiter's decision and ordering respondents Triangle Ace Corporation Inc. Jurisprudence has held time and again that abandonment is totally inconsistent with the immediate filing of a complaint for illegal dismissal. they were not given any duly accomplished payslips. despite their denials. instead. they did not present any evidence to prove their allegation. in receiving their wages. On the basis of the foregoing. They simply insisted that they did not report for work. However. 27 In the present case. because they were already terminated./Jose Lee to reinstatement. Calipay and the other complainants moved for the reconsideration. LABOR RELATIONS Atty. As a consequence. the Court arrives at the conclusion that the filing of the complaint for illegal dismissal appears only as a convenient afterthought on the part of petitioner and the other complainants after they were dismissed in accordance with law. Jefferson M. this incident later led to their dismissal in the same month. Labor Arbiter handling the case rendered a Decision dismissing the Complaint for lack of merit.

Marquez after his alleged termination from employment. On 15 February 2003. They did not ask for reinstatement. This is an indication that petitioner and the other complainants never had the intention or desire to return to their jobs.M. with a warning that their failure would be construed as abandonment of work. It is only in their Position Paper later prepared by their counsel that they asked for reinstatement. Ceasar T. management finds you culpable of grave misconduct and loss of trust and confidence. Nacague submitted this test result to Sulpicio Lines. G. 2010 Facts: On 15 June 1995. Sulpicio Lines subjected Nacague to a formal investigation. Sulpicio Lines. they only asked for payment of separation pay and other monetary claims. In view thereof. The memorandum reads: After a careful consideration of your case with the evidence available. The result of the random drug test revealed that Nacague was positive for methamphetamine hydrochloride or shabu. Private respondents' compliance with said requirements. were subjected to a random drug test. Chico. illegal dismissal and for reinstatement with backwages. They were taken to S. The drug test with Chong Hua Hospital yielded a negative result. On 20 February 2003. Lazo Clinic) and were required to submit urine samples. the company is constrained to terminate your employment effective today.M.R. taken together with the other circumstances above-discussed. together with Nacague. (Sulpicio Lines) hired Nacague as “hepe de viaje” or the representative of Sulpicio Lines on board its vessel M/V Princess of the World (the ship). When the ship docked in the port of Manila on 18 February 2003. Jefferson M. However. Sulpicio Lines. 55. Nacague v. a housekeeper on the ship. March 7. Lazo Medical Clinic (S. Feeling aggrieved. petitioner and the other complainants' inconsistency in their stand is also shown by the fact that in the complaint form which they personally filled up