MANAGEMENT PREROGATIVE: Fraud, requisites:

 Committed against the ER or his rep

 In connection with EE work
 Position must be with trust and confidence
examples
Loss of Confidence, requisites:
 Work related
 Position must be impressed with trust & confidence such as custody of money, property

Loss of Confidence, requisites (in negative):

Promotion:  Not simulated. Not insubstantial, not inadequate.
 Not be used as subterfuge for causes which are improper, illegal, or unjustified
 Not be arbitrarily asserted in the face of overwhelming evidence to the contrary
 Genuine. Not mere afterthought to justify earlier bad faith.
Demotion:  EE holds a position of trust and confidence.

AUTHORIZE CAUSES
1. Installation of Labor-Saving Devices – reduction of the number of workers in a
company’s factory made necessary by the introduction of machinery.

2. Redundancy – where the services of an EE are in excess of what is reasonably demanded

by the actual requirements of enterprise. SHOULD BE OBSERVED IN GOOD FAITH.
A position is redundant when it is superfluous and superfluity of a position or positions
may be the outcome of a number of factors, such as overhiring. ER no legal obligation to
keep it its payroll more EE that are necessary for the operation of its business.
Constructive Dismissal: Demotion without valid cause, plus unbearable/inhuman DO NOT necessarily refer to duplication of work.
treatment
REMEDY for Constructive Dismissal: 1. Reinstatement, 2. Backwages, 3. Damages Redundancy requisites:
1. Written notice served on both the employees and DOLE – 1 month prior to date
Transfer: 2. Payment of separation pay – 1 month, 1 month rule
It is the lateral movement from one position to another of equivalent rank, level, salary 3. Good faith in abolishing redundant positions
without break of service to maximize the service of employee. CONSENT NOT REQUIRED 3. Fair and reasonable criteria:
 Reasonable – to augment work force 1. Less preferred status (temporary employee)
 Not inconvenient to welfare of EE 2. Efficiency
 Not prejudicial 3. Seniority
 No demotion of rank or status or diminution of salary
 No discrimination Replacing a Regular EE with an Independent Contractor – VALID. Exercise of
 No bad faith management’s prerogative.
 Not effected as a form of punishment/demotion without sufficient cause
2. Retrenchment – linked with loss, cost cutting measure made immediately necessary by
Dismissal: business reduction or reverses. LAY OFF.
Termination of Employment – Art 282 – Requisites:
1. Losses are substantial and not merely de minimis extent
 Not arbitrarily
2. Losses must be reasonably imminent
 Not capricious
3. it must be reasonably necessary
 Observe due process 4. losses my be proved by sufficient and convincing evidence
JUST CAUSE OF DISMISSAL
1. Serious Misconduct – improper or wrong conduct. It is a transgression f some 2. Closure of Business – Not necessary that the entire business will close.
established and definite rule of action, a forbidden act, a dereliction of duty, willful in Exemptions to the rule of prior notice and hearing before closure order:
character, and implies wrongful intent and not mere a judgment of error. 1. violation of RA 9231 has resulted in death, insanity, or physical injury of a child EE
Elements 2. Such firm or establishment is employing a child for prostitution or obscene lewd
 An improper act 3. imminent danger of life and limb of child.
 Willful in nature
 Grave and aggravated character, not merely trivial or unimportant
 Work related

Requisites
 Serious and not minor
 Work related
 Show that EE become unfit to continue working for ER

2. Willful Disobedience – wanton disregard to follow the order, rules of ER

V. Disease as a ground for termination
Requisites: Requirements:
 Intentional. Wrongful. Perverse attitude 1. An employee been found to be suffering from any disease
 Order violated must be reasonable, lawful 2. His continued employment is prohibited by law or prejudicial to his health or to the
 Order made known from start health of his co-employees
 Order pertain to duties engaged to discharge 3. A competent public health authority certifies that the disease is of such nature or at
such a stage that it cannot be cured within a period of six months even with proper
Order must be: medical treatment.
 Reasonable and lawful 4. Payment of separation pay equivalent to at least 1 mo. Salary or to ½ mo. salary for
 Sufficiently known to EE every year of service, whichever is greater, a fraction of at least six months being
considered as one whole year (Deofrio vs Intel)
 Work related

3. Gross and Habitual Neglect of Duties

Gross Negligence –
The want or absence of or failure to exercise slight care of diligence, or the entire absence
of care. Thoughtless disregard of consequences without exerting any effort to avoid them.

Habitual Neglect –
Repeated failure to perform one’s duties for a period of time, case2 case basis.

Abandonment – form of neglect of duty. Must have a clear and deliberate intent to
discontinue one’s employment without any intention of returning back.
1. failure to report for work or absence without valid or justifiable reason
2. clear intention to sever the EE-ER relationship

Attitude Problem – when personal differences between EE and ER affect the work, peace
of company is affected. Analogous to loss of trust and confidence.

4. Fraud or Willful Breach of Trust reposed in him – commission or concealment which

involves a breach of legal duty, trust and confidence and is injurious to the other

Positions of Trust and Confidence:

 Managerial, those vested with powers or prerogatives to lay down policies, control EE
 Those incharge with care and custody of ER’s money or property
 Those in normal duty or function regularly handle significant amounts of money