OTHER CAUSES OF TERMINATION

Constructive Discharge

PHILIPPINE JAPAN ACTIVE CARBON CORPORATION v.

NLRC
Facts:

The private respondent OLGA S. QUIÑANOLA, who had been employed in PHILIPPINE JAPAN
ACTIVE CARBON CORPORATION since 1982, as Assistant Secretary/Export Coordinator, was
promoted on 1983 to the position of Executive Secretary to the Executive Vice President and General
Manager.

On 1986, for no apparent reason at all and without prior notice to her, she was transferred to the
Production Department as Production Secretary, swapping positions with Ester Tamayo.

Although the transfer did not amount to a demotion because her salary and workload remained the
same, she believed otherwise so she rejected the assignment and filed a complaint for illegal dismissal.

Issue: Won or not Respondent was constructively dismissed;

Held: NO

A constructive discharge is defined as: "A quitting because continued employment is rendered
impossible, unreasonable or unlikely; as, an offer involving a demotion in rank and a diminution in
pay."

In this case, the private respondent's assignment as Production Secretary of the Production Department
was not unreasonable as it did not involve a demotion in rank (her rank was still that of a department
secretary) nor a change in her place of work (the office is in the same building), nor a diminution in
pay, benefits, and privileges. It did not constitute a constructive dismissal.

It is the employer's prerogative, based on its assessment and perception of its employees' qualifications,
aptitudes, and competence, 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. 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. When his
transfer is not unreasonable, nor inconvenient, nor prejudicial to him, and it does not involve a
demotion in rank or a diminution of his salaries, benefits, and other privileges, the employee may not
complain that it amounts to a constructive dismissal.

CONSTRUCTIVE DISMISSAL REQUISITES

DIVINE WORD COLLEGE OF LAOAG, PETITIONER, VS. SHIRLEY B.

MINA, AS HEIR-SUBSTITUTE OF THE LATE DELFIN A. MINA,
RESPONDENT.

FACTS:

DWCL is a non-stock educational institution offering catholic education to the public. It is run by the
Society of Divine Word (SVD), a congregation of Catholic priests that maintains several other member
educational institutions throughout the country.

Mina was first employed in 1971 as a high school teacher, and later on a high school principal, at the
Academy of St. Joseph (ASJ), a school run by the SVD.

On 1979, he transferred to DWCL and was accorded a permanent status after a year of probationary
status. He was subsequently transferred in 2002 to DWCL's college department as an Associate
Professor III.

Thereafter, on 2003, Mina was assigned as the College Laboratory Custodian of the School of Nursing
and was divested of his teaching load, effective 2003 until 2004, subject to automatic termination
and without need for any further notification.

In early June 2004, Mina was offered early retirement by Professor Noreen dela Rosa, Officer-in-
Charge of DWCL's School of Nursing. He initially declined the offer because of his family's
dependence on him for support.

It was made to appear that his services were terminated by reason of redundancy to avoid any tax
implications.

ISSUE: WON THERE WAS CONSTRUCTIVE DISMISSAL?

HELD: YES

Constructive dismissal is a dismissal in disguise. There is cessation of work in constructive dismissal

because '"continued employment is rendered impossible, unreasonable or unlikely, as an offer involving
a demotion in rank or a diminution in pay' and other benefits."

To be considered as such, an act must be a display of utter discrimination or insensibility on the part of
the employer so intense that it becomes unbearable for the employee to continue with his employment.

In this case, Mina's transfer clearly amounted to a constructive dismissal. For almost 22 years, he was a
high school teacher enjoying a permanent status in DWCL's high school department. In 2002, he was
appointed as an associate professor at the college department but shortly thereafter, or on June 1, 2003,
he was appointed as a college laboratory custodian, which is a clear relegation from his previous
position. Not only that. He was also divested of his teaching load. His appointment even became
contractual in nature and was subject to automatic termination after one year "without any further
notification.

MINA'S APPOINTMENT AS LABORATORY CUSTODIAN WAS A DEMOTION. There is

demotion when an employee occupying a highly technical position requiring the use of one's mental
faculty is transferred to another position, where the employee performed mere mechanical work —
virtually a transfer from a position of dignity to a servile or menial job. The assessment whether Mina's
transfer amounted to a demotion must be done in relation to his previous position, that is, from an
associate college professor, he was made a keeper and inventory-taker of laboratory materials. Clearly,
Mina's new duties as laboratory custodian were merely perfunctory and a far cry from his previous
teaching job, which involved the use of his mental faculties. And while there was no proof adduced
showing that his salaries and benefits were diminished, there was clearly a demotion in rank.

MISAMIS ORIENTAL II ELECTRIC SERVICE COOPERATIVE (MORESCO

II), PETITIONER, VS. VIRGILIO M. CAGALAWAN

FACTS:
On September 1993, MORESCO II, a rural electric cooperative, hired Cagalawan as a Disconnection
Lineman on a probationary basis.

On 1994 Cagalawan was appointed to the same post this time on a permanent basis.

On 2001, he was designated as Acting Head of the disconnection crew in Area III sub-office of
MORESCO II in Balingasag, Misamis Oriental (Balingasag sub-office).

In a Memorandum dated 2002, MORESCO II General Manager Amado B. Ke-e (Ke-e) transferred
Cagalawan to Area I sub-office in Gingoog City, Misamis Oriental (Gingoog sub-office) as a member
of the disconnection crew. Said memorandum stated that the transfer was done "in the exigency of the
service."

Cagalawan assailed his transfer claiming he was effectively demoted from his position as head of the
disconnection crew to a mere member thereof. He also averred that his transfer to the Gingoog sub-
office is inconvenient and prejudicial to him as it would entail additional travel expenses to and from
work.

Ke-e explained that Cagalawan's transfer was not a demotion since he was holding the position of
Disconnection Head only by mere designation and not by appointment. Ke-e did not, however, state the
basis of the transfer but instead advised Cagalawan to just comply with the order and not to question
management's legitimate prerogative to reassign him.

Cagalawan eventually stopped reporting for work. 2002, he filed a Complaint for constructive
dismissal before the Arbitration branch of the NLRC against MORESCO II.

ISSUE: WON there was constructive dismissal in this case.

HELD:
YES

The rule is that it is within the ambit of the employer's prerogative to transfer an employee for valid
reasons and according to the requirement of its business, provided that the transfer does not result in
demotion in rank or diminution of salary, benefits and other privileges.

This Court has always considered the management's prerogative to transfer its employees in pursuit of
its legitimate interests. But this prerogative should be exercised without grave abuse of discretion and
with due regard to the basic elements of justice and fair play, such that if there is a showing that the
transfer was unnecessary or inconvenient and prejudicial to the employee, it cannot be upheld.
While we find that the transfer of Cagalawan neither entails any demotion in rank since he did not have
tenurial security over the position of head of the disconnection crew, nor result to diminution in pay as
this was not sufficiently proven by him, MORESCO II's evidence is nevertheless not enough to show
that said transfer was required by the exigency of the electric cooperative's business interest. Simply
stated, the evidence sought to be admitted by MORESCO II is not substantial to prove that there was a
genuine business urgency that necessitated the transfer.

The only evidence adduced by MORESCO II to support the legitimacy of the transfer was the letter-
request of Engr. Canada. However, this piece of evidence cannot in itself sufficiently establish that the
Gingoog sub-office was indeed suffering from losses due to collection deficiency so as to justify the
assignment of additional personnel in the area. Engr. Canada's letter is nothing more than a mere
request for additional personnel to augment the number of disconnection crew assigned in the area.

MORESCO II could have at least presented financial documents or any other concrete documentary
evidence showing that the collection quota of the Gingoog sub- office has not been met or could not be
reached. It should have also submitted such other documents which would show the lack of sufficient
personnel in the area. Unfortunately, the area manager's letter provides no more than bare allegations
which deserve not even the slightest credit.

When there is doubt between the evidence submitted by the employer and that submitted by the
employee, the scales of justice must be tilted in favor of the employee.

This is consistent with the rule that an employer's cause could only succeed on the strength of its own
evidence and not on the weakness of the employee's evidence.

Thus, MORESCO II cannot rely on the weakness of Ortiz's certification in order to give more credit to
its own evidence. Self-serving and unsubstantiated declarations are not sufficient where the quantum of
evidence required to establish a fact is substantial evidence, described as more than a mere scintilla.

"The evidence must be real and substantial, and not merely apparent."

MORESCO II has miserably failed to discharge the onus of proving the validity of Cagalawan's
transfer.
JOMAR S. VERDADERO, PETITIONER, VS. BARNEY AUTOLINES GROUP
OF COMPANIES TRANSPORT, INC., AND/OR BARNEY D. CHITO, ROSELA
F. CHITO AND GEIURDO GIMENEZ, RESPONDENTS.

Facts:

On September 10, 2004, respondent Barney Autolines Group of Companies Transport, Inc. (BALGCO)
hired Verdadero as bus conductor.

On 2008, an altercation took place between Verdadero and respondent Atty. Gerardo Gimenez
(Gimenez), BALGCO's Disciplinary Officer.

Gimenez was on board BALGCO Bus. together with his wife and four other companions, travelling
from Mulanay to Macalelon, Quezon. Verdadero was then the assigned bus conductor.

BALGCO has a company policy of granting free rides to company employees and their wives.

The story started when Verdadero began issuing fare tickets to passengers, including the wife of
Gimenez. The wife informed Verdadero who she was and the incidents thereafter took two versions as
both parties told a different story.

Gimenez filed an unverified complaint for serious misconduct against Verdadero before the BALGCO
Management.

Verdadero was said to have shown willingness to be penalized for his misconduct provided no record of
the proceedings would be made. Gimenez, on the other hand, was willing to waive the imposition of
any penalty if Verdadero would give a simple letter of apology, which the latter supposedly agreed with
his father guaranteeing the same.

On March 28, 2008, Verdadero submitted his Letter-Reply, explaining that he had been receiving
threats. He likewise believed he was already illegally dismissed as he was not given any work
assignment since January 28, 2008. Rosela responded to Verdadero's letter and reminded him of the
letter of apology which he was yet to submit as compliance. On April 15, 2008, however, Verdadero
filed a complaint for illegal dismissal before the Labor Arbiter.

ISSUE: WON Verdadero was constructively dismissed?

HELD: NO
Constructive dismissal exists where there is cessation of work, because "continued employment is
rendered impossible, unreasonable or unlikely, as an offer involving a demotion in rank or a
diminution in pay" and other benefits. Aptly called a dismissal in disguise or an act amounting to
dismissal but made to appear as if it were not, constructive dismissal may, likewise, exist if an act of
clear discrimination, insensibility, or disdain by an employer becomes so unbearable on the part
of the employee that it could foreclose any choice by him except to forego his continued
employment.

In this case, Verdadero cannot be deemed constructively dismissed.

Records do not show any demotion in rank or a diminution in pay made against him. Neither was there
any act of clear discrimination, insensibility or disdain committed by BALGCO against Verdadero
which would justify or force him to terminate his employment from the company.

To support his contention of constructive dismissal, Verdadero considers the verbal abuse by Gimenez
against him as an act which rendered his continued employment impossible, unreasonable or unlikely.
The claimed abuse was corroborated by the sworn written statement executed by Mascariña, which was
given credence by the NLRC and the CA. With the alleged threats of Gimenez, Verdadero believed that
he could no longer stay and work for BALGCO.

It is to be emphasized that the abovementioned acts should have been committed by the employer
against the employee. UNLAWFUL ACTS COMMITTED BY A CO-EMPLOYEE WILL NOT
BRING THE MATTER WITHIN THE AMBIT OF CONSTRUCTIVE DISMISSAL.

Contrary to the arguments of Verdadero, Gimenez is not the employer. He may be the "disciplinary
officer," but his functions as such, as can be gleaned from the BALGCO Rules and Regulations,[27] do
not involve the power or authority to dismiss or even suspend an employee. Such power is exclusively
lodged in the BALGCO management. Gimenez remains to be a mere employee of BALGCO and, thus,
cannot cause the dismissal or even the constructive dismissal of Verdadero.

Moreover, it was not established that BALGCO itself or its owners had been, in any way, forcing
Verdadero to resign from his employment. In fact, records show that the management had been urging
him to report back to work, not only to face the administrative charge against him, but also because of
the scarcity and necessity of bus conductors in the company.
It was Verdadero himself who terminated his employment. It was, in fact, his position that the January
27, 2008 bus incident gave rise to constructive dismissal.

Well-settled is the rule in illegal dismissal case that while the employer bears the burden of proving that
the termination was for a valid or authorized cause, the employee must first establish by substantial
evidence the fact of his dismissal from service.

SUPERSTAR SECURITY AGENCY, INC. AND/OR COL. ARTURO ANDRADA,

PETITIONERS, VS. NATIONAL LABOR RELATIONS COMMISSION

Facts:
Filomena Hermosa (Hermosa, for short) was hired by petitioner Superstar Security Agency (Agency,
for short) as a Security Guard.

She was assigned to different detachments in premises owned by the Agency's clients such as the
Supergarment Malugay Yakal (SMY) or Rustan Commercial Corporation Warehouse, Rustan Group of
Companies consisting of Rustan Commercial Corporation (Cubao and Makati Detachments), Tourist
Duty Free Shop (FTI Detachment, Hyatt, Hilton and Sheraton Detachments), and Rustan Supermarket
Warehouse (Rockefeller Detachment).

On February 1, 1985, the Agency placed Hermosa on a temporary "offdetail."

On March 5, 1985, Hermosa filed a complaint for illegal dismissal. She claimed that she was
unceremoniously dismissed on suspicion that she was the author of an anonymous report about the
irregularities committed by her fellow lady security guards;

Petitioners, on the other hand, claimed that Hermosa was relieved of her SMY post due to the cost-
cutting program of its clients; that while she was on temporary "off-detail" since February 1, 1985, the
Agency continued to look for an available assignment for her with the other detachments; that,
however, the respective Security Directors of the said detachments signified their unwillingness to
accept her because of her poor performance and undesirable conduct and behavior .

Issue: WON there was constructive dismissal.

HELD:

NO.
The charge of illegal dismissal was prematurely filed. The records show that a month after Hermosa
was placed on a temporary "off-detail," she readily filed a complaint against the petitioners on the
presumption that her services were already terminated.

Temporary "off-detail" is not equivalent to dismissal. In security parlance, it means waiting to

be posted.

It is a recognized fact that security guards employed in a security agency may be temporarily sidelined
as their assignments primarily depend on the contracts entered into by the agency with third parties.

However, it must be emphasized that such temporary inactivity should continue only for six months.
Otherwise the security agency concerned could be liable for constructive dismissal under Article 287
(now Article 286) of the Labor Code.

Moreover, the defenses raised by the petitioners, namely, their clients' cost reduction program and their
refusal to accept the complainant's services do not appear to Us as a "scheme to camouflage
(Hermosa's) illegal dismissal.

We simply cannot ignore the reality of the situation obtaining in this case. In the business world,
companies which offer contracts for services cater to the whims and wishes of clients whether the same
are reasonable or not. Clients are not expected to explain the reasons for their demands while these
companies are not only expected but also are bound to comply with their clients' directives. In the case
at bar, We do not find it unusual for clients to resort to a cost-cutting program in view of the prevailing
economic condition and then to manifest their preferences of people they want to work with in their
establishments.