G.R. No.
153290             September 5, 2007
BMG RECORDS (PHILS.), INC. and JOSE YAP, JR., petitioners,
vs.
AIDA C. APARECIO and NATIONAL LABOR RELATIONS
COMMISSION, respondents.
Facts:
Petitioner BMG Records (Phils.), Inc. (BMG) is engaged in the business of
selling various audio records nationwide. On September 2, 1990, it hired
private respondent Aida C. Aparecio (Aparecio) as one of the promo girls in
its Cebu branch. For working from Monday to Sunday, she received a salary
of P181.00 per day.
On May 25, 1998, Aparecio filed a complaint against BMG and its Branch
Manager, Jose Yap, Jr., co-petitioner herein, for illegal dismissal and non-
payment of overtime pay, holiday pay, premium pay for rest day, 13th month
pay, service incentive leave, and separation pay.
Private Respondent alleged that:
1. That she was illegally dismissed or terminated from employment on
April 30, 1998; that before said date, however, she was asked by
respondent to resign and will be paid (sic) all her benefits due –
like a one-month pay for every year of service, payment of services
rendered, overtime and holiday pay, rest day, 13th month, service
incentive leave and separation pay – and to execute a letter of
resignation;
2. That in view of respondent's insistence to prepare and [execute] a
letter-resignation, even without proper accounting of any
accountability, the complainant was lured, induced and compelled
to submit a letter of resignation believing on respondent's promise
and assurance to pay all the benefits due her as aforesaid;
3. That after executing said resignation letter, the respondent did not
make good its promise and instead did an accounting by themselves in
the absence of herein complainant and arrived on a computation that
complainant's liability per their accounting reached to the staggering
amount of P8,000.00; that since they offered to pay a separation pay of
only P12,000.00, minus complainant's alleged accountability
of P8,000.00, they are ready to pay the balance thereof any time;
4. That herein complainant was under respondent's employ for seven (7)
years, seven (7) months and twenty-eight (28) days when illegally
terminated [from] her employment.
Petitioner alleged that:
A. Aparecio was initially performing well as an employee but as years
passed by she seemed to be complacent in the performance of her job
and had been comparing the salaries of promo girls in other companies.
It appeared that she was no longer interested in her job.
B. In April 1998, Aparecio and two other promo girls (Soco and
Mutya), intimated to their supervisor that they were intending to
resign and were requesting for some financial assistance. BMG
made it clear that, as a company policy, an employee who resigns
from service is not entitled to financial assistance, but considering
the length of their service and due to humanitarian consideration it
would accede to the request after they secure their respective
clearances. Forthwith, the three employees tendered their
resignations, which were accepted.
C. When they processed the required individual clearance, it was found
out that they had incurred some shortages after inventory. Per
agreement, said shortages were deducted from the amounts due
them. Thus, Soco and Mutya received their last salary, a proportion of
the 13th month pay, tax refund and financial assistance less the
deductions, and they executed their releases and quitclaims. Except for
the financial assistance, Aparecio also obtained the same yet
refused to sign the release and quitclaim, protesting the amount
of P9,170.12 deducted from the financial assistance. She was
adamant but BMG stood by the previous agreement.
LA - dismissed Aparecio's complaint.
Since the letter of resignation showed no signs that it was made
through duress or compulsion, it was concluded that the severance of her
employment in BMG was brought about by her resignation and not by
the illegal dismissal supposedly committed by the latter.
NLRC - found that Aparecio was illegally dismissed from service
We find that the elements of a valid resignation are not obtaining in this
case. It must be stressed that resignation is inconsistent with the filing of
the complaint. Moreover, even in the absence of physical force, duress or
compulsion applied upon complainant when she executed the alleged
resignation letter, factual circumstances tend to show the strong and
irresistible economic pressure originating from respondent if only to push
the complainant into accepting the offer.
CA - affirmed in toto the judgment of the NLRC
Issue: WON private respondent voluntarily resigned; if vitiated consent,
illegal dismissal. (Yes; No illegal dismissal)
Ruling:
WHEREFORE, the petition is GRANTED and the November 20, 2001
Decision and April 26, 2002 Resolution of the Court of Appeals in C.A. G.R.
SP No. 65403 affirming the August 23, 2000 Decision of the National Labor
Relations Commission are hereby REVERSED AND SET ASIDE. The
October 27, 1998 Decision of the Labor Arbiter finding that private
respondent was not illegally dismissed is hereby REINSTATED AND
AFFIRMED.
Ratio:
Private Respondent - point out that the finding of the NLRC that private
respondent (employee) did not voluntarily resign but was illegally
dismissed is well-supported by evidence. The following considerations
clearly show this, to wit:
One. It is admitted by both petitioners and the respondents that the supposed
resignation of private respondent was conditional in nature. It was premised
on petitioners' (employers) performance of certain prestations or petitioners'
compliance with certain conditions.
Two. The supposed decision of private respondent to tender a resignation
is vitiated by vices of consent. The resignation letter was wrongfully
obtained from private respondent on petitioners' inducement and promise to
pay employment benefits and financial assistance without any deductions.
However, it is now very clear that right from the start, petitioners did not
intend to comply with their promise. After private respondent handed in a
resignation letter, petitioners raised all obstacles to prevent private respondent
from actually receiving the promised employment benefits and financial
assistance. Accordingly, it can be easily said that fraud vitiated private
respondent's consent.
Three. The resignation letter was also obtained from private respondent
through undue pressure and influence which again vitiates the same. The
respondent NLRC made this finding:
"Moreover, even in the absence of physical force, duress or compulsion
applied upon complainant when she executed the alleged resignation
letter, factual circumstances tend to show the strong and irresistible
economic pressure originating from respondent if only to push the
complainant into accepting the offer." (NLRC Decision, 23 August 2000,
p. 5; underscoring ours)
Four. At the very least, it could be easily said that the decision to resign is
vitiated by mistake. It is unrebutted that private respondent handed in a
resignation letter on the firm belief that petitioners would pay her the
promised employment benefits and financial assistance without deductions.
Resignation is also a form of contract. Like any other contracts, it can be
vitiated by mistake and other vices of consent x x x
Five. Finally, it could also be said that the resignation letter was ineffective
because there was no meeting of the minds on the matter of resignation. As
pointed out earlier, it is an admitted fact that the supposed resignation
was conditional in character in the sense that it was premised on certain
conditions. Accordingly, the resignation letter could only be considered as a
mere offer. Since the petitioners obviously did not accept the conditions
attendant to the offer to resign, there is no resignation to speak of.
In a nutshell, Aparecio submits that fraud, undue influence, intimidation,
and/or mistake were attendant upon her resignation from BMG. As her
consent was allegedly vitiated, the act of resigning became involuntary;
hence, petitioners are guilty of illegal dismissal.
The argument is not tenable. First, Aparecio already communicated to other people that she was about to
resign to look for a better paying job since she had been complaining that
employees like her in other companies were earning much more;
Based on the pleadings, this Court finds nothing to support Aparecio's
allegation that fraud was employed on her to resign.
Second, prior to the submission of her resignation letter, Aparecio and two
other promo girls, Soco and Mutya, approached their supervisor, intimated
Fraud exists only when, through insidious words or machinations, the
their desire to resign, and requested that they be given financial assistance,
other party is induced to act and without which, the latter would not
which petitioners granted on the condition that deductions would be made in
have agreed to.25 This Court has held that the circumstances evidencing fraud
case of shortage after inventory;
and misrepresentation are as varied as the people who perpetrate it, each
assuming different shapes and forms and may be committed in as many
different ways. Fraud and misrepresentation are, therefore, never presumed; it Third, Aparecio, Soco, and Mutya submitted their duly signed resignation
must be proved by clear and convincing evidence and not mere letters, which were accepted by petitioners; and
preponderance of evidence.26 Hence, this Court does not sustain findings of
fraud upon circumstances which, at most, create only suspicion; otherwise, it
Fourth, Aparecio already initiated the processing of her clearance; thus, she
would be indulging in speculations and surmises.27
was able to receive her last salary, 13th month pay, and tax refund but refused
to receive the financial assistance less the deductions made.
In this case, Aparecio alleged that her resignation was wrongfully
obtained when petitioners did not keep the promise of giving her
The foregoing facts were affirmatively narrated and attested to in the
employment benefits and financial assistance without any deductions.
notarized affidavit of Soco and Cinco and have remained
Without a showing of the nature and extent of such "inducement,"
incontrovertible as they were never denied by Aparecio. The NLRC, thus,
however, such submission fails to establish that there was in fact a
erred when it did not give probative weight to their testimonies even if
deception on the part of petitioners. Even if it is considered that there
belatedly presented in petitioners' motion for reconsideration.
was an assurance given by petitioners and that they later reneged on
their promise, this Court still finds no injustice made since Aparecio, who
only questioned the manner by which the inventory was conducted – that Now, the acceptance by petitioners of Aparecio's resignation rendered
it was held without her presence – but did not categorically deny her the same effective.31 Upon such acceptance, it may not be unilaterally
accountabilities with BMG, would unjustly be enriched without the withdrawn without the consent of petitioners. 32 When the employee later
deduction. signified the intention of continuing his or her work, it was already up to
the employer to accept the withdrawal of his or her resignation. The
mere fact that the withdrawal was not accepted does not constitute illegal
Likewise, Aparecio did not adduce any competent evidence to prove that
dismissal, the acceptance of the withdrawal of the resignation being the
force or threat was applied by petitioners. For intimidation to vitiate
employer's sole prerogative.
consent, the following requisites must be present: (1) that the intimidation
caused the consent to be given; (2) that the threatened act be unjust or
unlawful; (3) that the threat be real or serious, there being evident As held in Intertrod Maritime, Inc. v. NLRC:33
disproportion between the evil and the resistance which all men can offer,
leading to the choice of doing the act which is forced on the person to do as
Once an employee resigns and his resignation is accepted, he no longer has
the lesser evil; and (4) that it produces a well-grounded fear from the fact that
any right to the job. If the employee later changes his mind, he must ask for
the person from whom it comes has the necessary means or ability to inflict
approval of the withdrawal of his resignation from his employer, as if he were
the threatened injury to his person or property. In the instant case, not one of
re-applying for the job. It will then be up to the employer to determine
these essential elements was amply proven by Aparecio. Bare allegations
whether or not his service would be continued. If the employer accepts said
of threat or force do not constitute substantial evidence to support a
withdrawal, the employee retains his job. If the employer does not x x x the
finding of forced resignation.
employee cannot claim illegal dismissal for the employer has the right to
determine who his employees will be. To say that an employee who has
On the contrary, petitioners correctly point out that the NLRC finding, resigned is illegally dismissed, is to encroach upon the right of employers to
which the CA erroneously affirmed, of a "strong and irresistible economic hire persons who will be of service to them.34
pressure originating from [petitioners] if only to push [Aparecio] into
accepting the offer" is not supported by any evidence in the records but is
Subsequently, in Philippine Today, Inc. v. NLRC,35 it was further held that:
merely based on conjectures and guesswork. Truly, the factual circumstances
upon which the legal conclusion was based were lacking as no less than the
NLRC itself admitted the absence of proof of any kind of pressure, economic Obviously, this is a recognition of the contractual nature of employment
or otherwise, that petitioners applied to force Aparecio's resignation. What is which requires mutuality of consent between the parties. An employment
clear is that there is no concrete evidence, direct or circumstantial, contract is consensual and voluntary. Hence, if the employee "finds
showing that undue influence was used by petitioners in such a way that himself in a situation where he believes that personal reasons cannot be
it took improper advantage of its power over the will of Aparecio and sacrificed in favor of the exigency of the service, then he has no other
deprived the latter of a reasonable freedom of choice. 29 Granting for the choice but to disassociate himself from his employment". If accepted by
sake of argument that BMG was in a "more advantageous position," as the the employer, the consequent effect of resignation is severance of the
CA had opined, it would nonetheless be unfair to presume that it utilized the contract of employment.
same against Aparecio. Indeed, the allegation of exploitation is a very serious
matter and should not be taken lightly. Proof is absolutely essential.
A resigned employee who desires to take his job back has to re-apply
therefor, and he shall have the status of a stranger who cannot
Resignation unilaterally demand an appointment. He cannot arrogate unto himself
the same position which he earlier decided to leave. To allow him to do so
would be to deprive the employer of his basic right to choose whom to
is the voluntary act of an employee who is in a situation where one
employ. Such is tantamount to undue oppression of the employer. It has been
believes that personal reasons cannot be sacrificed in favor of the
held that an employer is free to regulate, according to his own discretion and
exigency of the service, and one has no other choice but to dissociate
judgment, all aspects of employment including hiring. The law, in protecting
oneself from employment.
the rights of the laborer, impels neither the oppression nor self-destruction of
the employer.36
It is a formal pronouncement or relinquishment of an office, with the
intention of relinquishing the office accompanied by the act of
Certainly, what transpired here was caused by an employee's error of
relinquishment. As the intent to relinquish must concur with the overt
judgment and not by the employer's application of means vitiating the consent
act of relinquishment, the acts of the employee before and after the
to resign. It would be utterly unfair to attribute to petitioners the commission
alleged resignation must be considered in determining whether in fact, he
of illegal dismissal and to impose upon them the burden of accepting back
or she intended to sever from his or her employment.30
Aparecio who unequivocally manifested her intent and willingness to sever
her employment ties.
Thus, this Court agrees with petitioners' contention that the circumstances
surrounding Aparecio's resignation should be given due weight in
determining whether she had intended to resign. In this case, such intent is
very evident:
G.R. No. 177414             November 14, 2008
NOEL E. MORA, petitioner,
vs.
AVESCO MARKETING CORPORATION, respondent.
Facts:
In March 1996, petitioner was hired as a "sales engineer" at Avesco
Marketing Corporation (respondent) to supervise and install sound and
communications systems for its clientele.2 On March 25, 2003, he tendered
his letter of resignation to be effective a month after or on April 25, 2003.
The letter reads verbatim as follows:
Dear Sir:
It is with much reluctance and regret that I must ask to be released
from my position of Sales Engineer at Avesco Marketing. For the past
seven years, I cannot forget how much this company has meant to me.
With this regard, I'm tendering my resignation effective on April 25,
2003. Please extend to Mr. Jimmy Tang my appreciation of his kindness
during the time I served.3 (Emphasis and underscoring supplied)
It appears that petitioner's filing of a resignation letter came about after he
was confronted for "selling competitors' products" to the prejudice and
detriment of respondent and was given the option of either immediately
resigning or face administrative charges.4
It further appears that petitioner changed his mind and withdrew his letter
of resignation on the same day, March 25, 2003, after respondent denied
his request to have his resignation made effective a month after or on April
25, 2003
The following day or on March 26, 2003, respondent's personnel manager
issued to petitioner a notice of disciplinary action
A report by your Superiors has reached our office just recently some
days ago [sic] that you again have committed another breach of trust
[sic] against our Company in violation of our [sic] Company Rules and
Regulations. This time instead of attending to the products you have to
sell, you have surreptitiously undertaken sales transaction [sic], which is
patently inimical to the interest of the Company that results to sales loss
for the company.
As you know very well, earlier[,] you have been disciplined for breach
of trust against the Company . . . where you served a penalty of six days
suspension . . . with a stern warning that commission of similar
offense will eventually lead to your dismissal from the service of the
company. The report that reached us now is a repetition of similar breach
of trust reported upon you as Jr. Sales Engineer and for this, Management is
constrained to dismiss you from the service for loss of trust and
confident [sic] in gross violation of our Company Rules & Regulations on
Dishonesty and Fraud.
On account of the foregoing, you are hereby directed to submit to the
undersigned not later than 48 hours upon receipt of this memo why dismissal
penalty should not be effected against you for the cited violation.
Should you fail to comply with our requirement, the company may have
no other recourse except to initiate dismissal proceedings. Meantime, you
are placed under preventive suspension effective today, March 26,
2003 until further notice pending investigation of your case.
Petitioners Response to the notice of disciplinary action.
In response to your memo with reference no. PD-C003-095 dated
March 26, 2003 regarding to [sic] the preventive suspension you serve to
me [sic], I am not culpable.
The report of my superior that I am surreptitiously selling other
products instead of our products is just speculation and his mere tactics
[sic] for our unfavorable sales output for the month. I sell products only from
Avesco and never transact/deal other products. I know the consequences of
that move and never cross to my mind doing that kind of accusation
[sic].
I have been accused for a thing [sic] that I did not know what
particular transactions [sic], I was not being talked by my superior  [sic]
about this or even asked me [sic], this is just a one[-]sided accusation and I
am willing to know what it is all about. Your office did not explain to me
what this accusation is all about[,] instead offering me an immediate
resignation and your notice is a step for my termination [sic].
Petitioner had not heard from respondent thereafter. He was later to
learn from third party sources that his employment had been terminated
as of April 1, 2003.
Petitioner thereupon filed a complaint for illegal dismissal
LA- dismissed for lack of jurisdiction
The case was thus referred to the National Conciliation and Mediation
Board for voluntary arbitration.
VA - dismissed petitioner's complaint upon the ground that he had
voluntarily resigned.10
CA - denied the same, similarly finding him to have voluntarily
resigned from his job.
Issue: WON petitioner resigned; if no, illegal dismissal.
Petitioner argues that:
That he was only inveigled to file a resignation letter on March 25, 2003 after
he was asked by respondent's vice president to immediately resign and that
respondent's subsequent show cause order cum preventive suspension clearly
proves that he did not resign.
Respondent maintains that petitioner resigned
Ruling:
WHEREFORE, the assailed Decision of the Court of Appeals
is REVERSED and SET ASIDE. Respondent is ordered to reinstate
petitioner with full backwages without loss of seniority rights and privileges
from the time of his dismissal until his actual reinstatement or, if
reinstatement is no longer feasible, to give him separation pay equivalent to at
least one month salary for every year of service.
Ratio:
Resignation
In Mobile Protective & Detective Agency v. Ompad,25 the Court held that
should an employer interpose the defense of resignation, as in the present
case, it is still incumbent upon the employer, respondent herein, to prove
that the employee voluntarily resigned.
Voluntary resignations being unconditional in nature, both the intent and
the overt act of relinquishment should concur. If the employer introduces
evidence purportedly executed by an employee as proof of voluntary
resignation yet the employee specifically denies such evidence, as in
petitioner's case, the employer is burdened to prove the due execution and
genuineness of such evidence.26
Respondent in this case failed to discharge such burden. 
The notice of disciplinary action-"show cause" letter indefinitely suspending
petitioner, even after petitioner had submitted on March 25, 2003 his
letter of resignation, albeit alleged to have withdrawn on even date, negates
respondent's assertion of voluntary separation. If respondent considered
petitioner resigned on account of his March 25, 2003 letter, to be effective
on April 25, 2003, there would have been no more need to preventively
suspend him effective March 26, 2003 "until further notice pending
investigation" of his alleged transgressions.
It is significant to note that in his response to the March 26, 2003 "show
cause" letter of respondent, petitioner denied being "culpable" and sought to
know what were those "particular transactions"-bases of breach of trust. He
had not had the courtesy of any reply from respondents, however. His
preventive suspension effective March 26, 2003 lapsed into termination
six days later or on April 1, 2003, which he was to learn from third
parties.

For a resignation tendered by an employee to take effect, it should first be

accepted or approved by the employer.27 Petitioner's receipt by respondent's
personnel department of his resignation letter is not equivalent to approval.
Since petitioner requested that his resignation was to be effective a month
later or on April 25, 2003, respondent's approval was a fortiori necessary.

That respondent issued the "show cause" letter a day after petitioner filed the
controversial letter of resignation could only mean that it did not accept the
same.

Petitioner's "resignation" being premised on a qualification ─ that it be

effective April 25, 2003 ─ was conditional in character. It is thus only
considered as a mere offer. Since respondent did not accept the condition
attendant to the offer as, it bears repeating, he was in fact given a "show
cause" letter a day after, there was no resignation to speak of.

Illegal Dismissal

This brings the Court to the issue of whether petitioner was illegally
dismissed. The Court finds in the affirmative.

While selling of respondent's competitors' products is a valid ground for

termination of employment, an employer cannot just hurl generalized
accusations but should at least cite specific instances and proof in
support thereof. Respondent relied on a "report by [petitioner's] superiors" in
faulting petitioner. What this alleged "report" was and what it contained, no
testimonial or documentary proof thereof was proffered. And while
respondent gave the impression that it conducted or was going to conduct
an investigation on the basis of the "report," there is no showing that one
such was conducted and, if there was, what the result was.

The tenor of respondent's "show cause" letter sent to petitioner ─ it was

"constrained to dismiss" petitioner ─ shows that it was terminating his
services, the incongruent directive for him to explain notwithstanding.

While the appellate court's ratio that "preventive suspension is a disciplinary

measure for the protection of the company's property pending investigation of
any alleged malfeasance or misfeasance committed by the employee," 28 is
well-taken, it overlooked that the preventive suspension of petitioner effective
on March 26, 2003 "until further notice" lapsed into dismissal six days later
without petitioner substantiating the basis therefor.

Petitioner's questioned filing of the illegal dismissal case three months and 20
days after he withdrew his letter of resignation does not dent his case. Under
the law,29 he has four years to file his complaint.

In fine, petitioner's dismissal was illegal. His claim for damages and
attorney's fees must, however, be denied in light of his failure to prove the
bases therefor. Moral damages are meant to compensate the claimant for any
physical suffering, mental anguish, fright, serious anxiety, besmirched
reputation, wounded feelings, moral shock, social humiliation and similar
injuries unjustly caused.30 Broad allegations, bereft of proof, cannot sustain
the award of moral damages, as well as attorney's fees.
G.R. No. 188711 |  July 8, 2013
TAN BROTHERS CORPORATION OF BASILAN CITY THROUGH
ITS OWNER/MANAGER, MAURO F. TAN, PETITIONERS, vs. EDNA
R. ESCUDERO, RESPONDENT.
PEREZ, J.:
SUMMARY: Respondent Edna R. Escudero (Escudero) was hired as
bookkeeper by petitioner Tan Brothers Corporation. On 1 September 2004,
Escudero filed against Tan Brothers a complaint for illegal dismissal,
underpayment of wages, cost of living allowance and 13th month pay.
Escudero alleged that starting July 2003, her monthly salary of ₱2,500.00 was
not paid on time by Tan Brothers. After having the corporation’s office
remodeled in the early part of 2004, Tan Brothers allegedly rented out the
office space Escudero used to occupy and ceased giving her further
assignments. Eventually constrained to stop reporting for work because of her
dire financial condition, Escudero claimed that Tan Brothers "shrewdly
maneuvered" her illegal dismissal from employment. On the other hand, Tan
Brothers averred that Escudero abandoned her employment when she stopped
reporting for work in July 2003. Aside from taking with her most of the
corporation’s payrolls, vouchers and other material documents evidencing due
payment of wages and labor standard benefits, Tan Brothers maintained that,
without its knowledge and consent, Escudero appropriated for herself an
Olivetti typewriter worth ₱15,000.00. With Escudero’s refusal to heed its
demands for the return of the typewriter, Tan Brothers asseverated that it was
left with no choice but to lodge a complaint with the barangay authorities.
LA: rendered a decision, finding Tan Brothers guilty of constructively
dismissing Escudero from employment. NLRC: AFFIRMED LA’S
DECISION IN TOTO. CA: DENIED Tan Brothers’ petition and affirming the
NLRC’s resolution of its appeal. Tan Brothers contended that Escudero
abandoned her employment and that the same was not negated by the filing of
her complaint for illegal dismissal more than one year after she stopped
reporting for work
ISSUE: W/N ESCUDERO WAS ILLEGALLY DISMISSED (or W/N
ESCUDERO ABANDONED HER EMPLOYMENT)
SC: As defined under established jurisprudence, abandonment is the
deliberate and unjustified refusal of an employee to resume his employment.
It constitutes neglect of duty and is a just cause for termination of
employment under paragraph (b) of Article 282 of the Labor Code.To
constitute abandonment, however, there must be a clear and deliberate intent
to discontinue one's employment without any intention of returning. In this
regard, two elements must concur: (1) failure to report for work or absence
without valid or justifiable reason, and (2) a clear intention to sever the
employer-employee relationship, with the second element as the more
determinative factor and being manifested by some overt acts. Otherwise
stated, absence must be accompanied by overt acts unerringly pointing to the
fact that the employee simply does not want to work anymore. It has been
ruled that the employer has the burden of proof to show a deliberate and
unjustified refusal of the employee to resume his employment without any
intention of returning.
On the theory that the same is proof enough of the desire to return to work,
the immediate filing of a complaint for illegal dismissal – more so when it
includes a prayer for reinstatement – has been held to be totally inconsistent
with a charge of abandonment. While it is true that Escudero’s complaint
prayed for separation pay in lieu of reinstatement, Tan Brothers loses sight of
the fact, however, that it had the burden of proving its own allegation that
Escudero had abandoned her employment in July 2003. As allegation is not
evidence, the rule has always been to the effect that a party alleging a critical
fact must support his allegation with substantial evidence which has been
construed to mean such relevant evidence as a reasonable mind will accept as
adequate to support a conclusion. Confronted with Escudero’s assertion that
she reported for work despite irregular payment of her salaries and was forced
to stop doing so after her wages were not paid in May 2004, the record shows
that Tan Brothers proffered nothing beyond bare allegations to prove that
Escudero had abandoned her employment in July 2003.
It is, on the other hand, doctrinal that abandonment is a matter of intention
and cannot, for said reason, be lightly inferred, much less legally presumed
from certain equivocal acts. Viewed in the light of Escudero’s persistence in
reporting for work despite the irregular payment of her salaries starting July
2003, we find that her subsequent failure to do so as a consequence of Tan
Brothers’ non-payment of her salaries in May 2004 is hardly evincive of an
intention to abandon her employment. Indeed, mere absence or failure to
report for work, even after a notice to return work has been served, is not
enough to amount to an abandonment of employment. Considering that a
notice directing Escudero to return to work was not even issued in the
premises, we find that the CA committed no reversible error in ruling out Tan
Brother’s defense of abandonment.
The same may be said of the CA’s rejection of the employer’s contention that
the employee signified her intention to sever the parties’ employer-employee
relationship when she illegally appropriated for herself the corporation’s
typewriter and took its payrolls, vouchers and other material documents.
Since unsubstantiated accusation, without more, is not synonymous with
guilt, the CA correctly brushed aside Escudero’s supposed infraction which
Tan Brothers reported to the barangay authorities of Seaside, Isabela City
only on 6 September 2004 or after the filing of the complaint a quo
FACTS:
In July 1991, respondent Edna R. Escudero (Escudero) was hired as
bookkeeper by petitioner Tan Brothers Corporation of Basilan City (Tan
Brothers), a corporation primarily engaged in the real estate business. On 1
September 2004, Escudero filed against Tan Brothers a complaint for
illegal dismissal, underpayment of wages, cost of living allowance and
13th month pay. Escudero alleged in her position paper that, starting July
2003, her monthly salary of ₱2,500.00 was not paid on time by Tan
Brothers. After having the corporation’s office remodeled in the early
part of 2004, Tan Brothers allegedly rented out the office space Escudero
used to occupy and ceased giving her further assignments. Eventually
constrained to stop reporting for work because of her dire financial
condition, Escudero claimed that Tan Brothers "shrewdly maneuvered"
her illegal dismissal from employment.
On the other hand, Tan Brothers averred that Escudero was paid a daily
wage of ₱155.00, and she abandoned her employment when she stopped
reporting for work in July 2003. Aside from taking with her most of the
corporation’s payrolls, vouchers and other material documents
evidencing due payment of wages and labor standard benefits, Tan
Brothers maintained that, without its knowledge and consent, Escudero
appropriated for herself an Olivetti typewriter worth ₱15,000.00. With
Escudero’s refusal to heed its demands for the return of the typewriter,
Tan Brothers asseverated that it was left with no choice but to lodge a
complaint with the barangay authorities of Seaside, Isabela City on 6
September 2004. In support of its claim of due payment of its employees’
wages and benefits, Tan Brothers submitted copies of its remaining vouchers
and payrolls from 24 December 1997 to 31 July 2000 which were prepared by
Escudero and the result of the inspection conducted by the Department of
Labor and Employment (DOLE) Regional Office No. 9 that cleared it of
violations of labor standard laws.
LA: rendered a decision, finding Tan Brothers guilty of constructively
dismissing Escudero from employment. Rejecting Tan Brothers’ claim that
Escudero resigned from and/or abandoned her employment, the Labor Arbiter
ruled that the former circumvented the substantive and procedural
requirements of due process when it withheld the latter’s salaries and
stopped utilizing her services despite her presence at work. Also brushed
aside was Tan Brother’s claim regarding the typewriter allegedly taken by
Escudero on the ground that the cause of action relative thereto, if any,
pertained to the regular courts. While giving credence to the pieces of
documentary evidence adduced by Tan Brothers to prove due payment of
wages and labor standard benefits to its employees, the Labor Arbiter ruled
that, as a consequence of her constructive dismissal, Escudero was entitled to
separation pay in the sum of ₱48,508.80 and backwages in the sum of
₱68,720.80 or a total of ₱117,229.60 in monetary awards.
NLRC: AFFIRMED LA’S DECISION IN TOTO. Echoing the Labor
Arbiter’s conclusion that Escudero was constructively dismissed, the
NLRC further ruled that Tan Brother’s claim of loss of the typewriter,
having been made after said employee’s institution of the case a quo, was
retaliatory and a mere afterthought.
Its motion for reconsideration of the foregoing resolution denied for lack of
merit, Tan Brothers filed the Rule 65 petition for certiorari before the
CA. In support of its petition, Tan Brothers faulted the NLRC with grave
abuse of discretion for not finding that Escudero abandoned her
employment despite her admission that she unilaterally stopped
reporting for work. On the theory that abandonment is a serious misconduct
which constituted a just cause for termination of employment under Article
282 of the Labor Code of the Philippines, it was, likewise, argued that the
award of backwages and separation pay in favor of Escudero were bereft of
legal basis.
CA: DENIED Tan Brothers’ petition and affirming the NLRC’s
resolution of its appeal. Finding that Escudero was constructively
dismissed when Tan Brothers stopped paying her salaries and giving her
work assignments, the CA ruled out abandonment absent any showing
that the former intended to sever the employer-employee relationship
with the latter. Considered not established by an employee’s mere
absence or failure to report to work, abandonment was likewise held to
be contradicted by the filing of an action for illegal dismissal. The CA also
gave a short shrift to Tan Brothers’ claim that Escudero took its typewriter
and corporate records for lack of showing that the latter was confronted with
and was given an opportunity to refute the charges against her.
CONTENTION OF TAN BROS: Escudero abandoned her employment and
that the same was not negated by the filing of her complaint for illegal
dismissal more than one year after she stopped reporting for work.
ISSUE: W/N ESCUDERO WAS ILLEGALLY DISMISSED–YES (or
W/N ESCUDERO ABANDONED HER EMPLOYMENT–NO)
RATIO:
In order to terminate an employee’s services for a just cause, moreover, it is
essential that the two-notice requirement must be complied with by the
employer, to wit: a) a written notice containing a statement of the cause for
the termination to afford the employee ample opportunity to be heard and
defend himself with the assistance of his representative, if he so desires; and
b) if the employer decides to terminate the services of the employee, the
employer must notify him in writing of the decision to dismiss him, stating
clearly the reason therefor. The requirement of these notices is not a mere
technicality, but a requirement of due process to which every employee is
entitled.

As defined under established jurisprudence, abandonment is the deliberate
and unjustified refusal of an employee to resume his employment. It
constitutes neglect of duty and is a just cause for termination of
employment under paragraph (b) of Article 282 of the Labor Code.To
constitute abandonment, however, there must be a clear and deliberate
intent to discontinue one's employment without any intention of
returning. In this regard, two elements must concur: (1) failure to report for
work or absence without valid or justifiable reason, and (2) a clear
intention to sever the employer-employee relationship, with the second
element as the more determinative factor and being manifested by some
overt acts. Otherwise stated, absence must be accompanied by overt acts
unerringly pointing to the fact that the employee simply does not want to
work anymore. It has been ruled that the employer has the burden of
proof to show a deliberate and unjustified refusal of the employee to
resume his employment without any intention of returning.
Neither are we inclined to disturb the CA’s finding that Escudero was
constructively dismissed by Tan Brothers which, as employer, had the
burden of proving that said employee was dismissed for a just and valid
cause. Constructive dismissal occurs when there is cessation of work
because continued employment is rendered impossible, unreasonable, or
unlikely as when there is a demotion in rank or diminution in pay or
when a clear discrimination, insensibility, or disdain by an employer
becomes unbearable to the employee leaving the latter with no other
option but to quit. The test is whether a reasonable person in the
employee's position would have felt compelled to give up his position
under the circumstances. Much though Tan Brothers may now be inclined
to disparage the same as mere alibis, the fact that Escudero was deprived of
office space, was not given further work assignment and was not paid her
salaries until she was left with no choice but stop reporting for work all
combine to make out a clear case of constructive dismissal.

Defense of Tan Brothers: argues that Escudero unilaterally stopped
reporting for work in July 2003. In addition to the latter’s prolonged absence
from work, Tan Brothers calls our attention to Escudero ’s supposed
appropriation of the corporation’s typewriter and records which supposedly
evinced her intention to sever the parties’ employer-employee relations. It is
argued that, having committed the foregoing infraction to get even with her
employer, it would have been unthinkable for Escudero to plan on further
reporting for work. Considering that the complaint did not pray for
reinstatement and was filed only on 1 September 2004 or more than one year
after Escudero’s supposed last attendance at work, Tan Brothers also fault the
CA for applying the rule that abandonment is negated by the employee ’s
filing of a complaint for illegal dismissal. Ultimately, Tan Brothers maintains
that the award of backwages and separation pay should have been disallowed
in view of Escudero’s abandonment of her employment.
Having been constructively dismissed, Escudero was correctly found entitled
to backwages and attorney’s fees by the Labor Arbiter, the NLRC and the
CA. Under Article 279 of the Labor Code, as amended, employees who have
been illegally terminated from employment are entitled to the twin reliefs of
reinstatement without loss of seniority rights and to the payment of full back
wages corresponding to the period from their illegal dismissal up to actual
reinstatement. Reinstatement is a restoration to the state from which one has
been removed or separated, while the payment of backwages is a form of
relief that restores the income that was lost by reason of the unlawful
dismissal. Proper where reinstatement is not advisable or feasible as when
antagonism already caused a severe strain in the relationship between the
employer and the employee, separation pay may also be awarded where, as
here, reinstatement is no longer practical or in the best interest of the parties
or when the employee decides not to be reinstated anymore.

On the theory that the same is proof enough of the desire to return to work,
the immediate filing of a complaint for illegal dismissal – more so when it
includes a prayer for reinstatement – has been held to be totally
inconsistent with a charge of abandonment. While it is true that
Escudero’s complaint prayed for separation pay in lieu of reinstatement,
Tan Brothers loses sight of the fact, however, that it had the burden of
proving its own allegation that Escudero had abandoned her employment
in July 2003. As allegation is not evidence, the rule has always been to the
effect that a party alleging a critical fact must support his allegation with
substantial evidence which has been construed to mean such relevant
evidence as a reasonable mind will accept as adequate to support a
conclusion. Confronted with Escudero’s assertion that she reported for work
despite irregular payment of her salaries and was forced to stop doing so after
her wages were not paid in May 2004, the record shows that Tan Brothers
proffered nothing beyond bare allegations to prove that Escudero had
abandoned her employment in July 2003.

It is, on the other hand, doctrinal that abandonment is a matter of

intention and cannot, for said reason, be lightly inferred, much less
legally presumed from certain equivocal acts. Viewed in the light of
Escudero’s persistence in reporting for work despite the irregular
payment of her salaries starting July 2003, we find that her subsequent
failure to do so as a consequence of Tan Brothers’ non-payment of her
salaries in May 2004 is hardly evincive of an intention to abandon her
employment. Indeed, mere absence or failure to report for work, even
after a notice to return work has been served, is not enough to amount to
an abandonment of employment. Considering that a notice directing
Escudero to return to work was not even issued in the premises, we find
that the CA committed no reversible error in ruling out Tan Brother’s
defense of abandonment.

The same may be said of the CA’s rejection of the employer’s contention
that the employee signified her intention to sever the parties’ employer-
employee relationship when she illegally appropriated for herself the
corporation’s typewriter and took its payrolls, vouchers and other
material documents. Since unsubstantiated accusation, without more, is
not synonymous with guilt, the CA correctly brushed aside Escudero’s
supposed infraction which Tan Brothers reported to the barangay
authorities of Seaside, Isabela City only on 6 September 2004 or after the
filing of the complaint a quo.
G. R. No. 163061, June 26, 2013
ALFONSO L. FIANZA, Petitioner, v. NATIONAL LABOR RELATIONS
COMMISSION (SECOND DIVISION), BINGA HYDROELECTRIC
PLANT, INC., ANTHONY C. ESCOLAR, ROLAND M. LAUTCHANG,
Respondents.
SERENO, C.J.:
SUMMARY: Petitioner Fianza was employed as Officer for Social
Acceptance of respondent Binga Hydroelectric Plant, Inc. In February 1999,
petitioner did not receive his salary of P15,000 for the first 15 days of the
month of February. He was advised not to report for work until his status was
officially clarified by the Manila office. After petitioner made several other
inquiries concerning his status, he was told by a supervisor to report for work.
However, he was also told that the new management committee had to concur
in his reappointment before he could be reinstated in the payroll. It also
wanted an opportunity to determine whether his services would still be
necessary to the company. Meanwhile, the chief of the rehabilitation
department of the company recommended his return. As the management
committee did not act on his inquiries for several months, on 24 May 1999
petitioner filed a Complaint for illegal dismissal before the LA. LA: RULED
IN FAVOR OF PETITIONER. NLRC: REVERSED LA’s decision.CA:
AFFIRMED NLRC’s reversal, and denied his motion for reconsideration.
ISSUE: W/N PETITIONER ABANDONED HIS WORK- NO
SC: At the outset, it is clear that the requisites for a judicial declaration of
abandonment are absent in this case. Suffice it to say that abandonment is a
fact that must be proven in accordance with the standard set by this Court:
It is well-settled in our jurisprudence that “For abandonment to
constitute a valid cause for termination of employment, there must
be a deliberate, unjustified refusal of the employee to resume his
employment. This refusal must be clearly shown. Mere absence is
not sufficient, it must be accompanied by overt acts unerringly
pointing to the fact that the employee does not want to work
anymore” (Emphasis and italics supplied).
Abandonment as a fact and a defense can only be claimed as a ground for
dismissal if the employer follows the procedure set by law. In line with the
burden of proof set by law, the employer who alleges abandonment “has the
burden of proof to show a deliberate and unjustified refusal of the employee
to resume his employment without any intention of returning.” As this Court
has stated in Agabon v. National Labor Relations Commission:
For a valid finding of abandonment, these two factors should be
present: (1) the failure to report for work or absence without valid or
justifiable reason; and (2) a clear intention to sever employer-
employee relationship, 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
intent to discontinue the employment must be shown by clear proof
that it was deliberate and unjustified.
From the foregoing, it is clear that respondent company failed to prove the
necessary elements of abandonment. Additionally, the NLRC and the CA
failed to take into account the strict requirements set by jurisprudence when
they determined the existence of abandonment on the basis of mere
allegations that were contradicted by the evidence shown.
The very act of filing the Complaint for illegal dismissal should have negated
any intention on petitioner’s part to sever his employment. In fact, it should
already have been sufficient evidence to declare that there was no
abandonment of work. Moreover, petitioner went back to the company
several times to inquire about the status of his employment. The fact that his
inquiries were not answered does not prejudice this position.
Throughout the entire ordeal, petitioner was vigilant in protecting himself
from any claim that he had abandoned his work. The following circumstances
evinced his intent to return to work:
1. His continuous inquiry with respondent about the status of his work.
2. His willingness to return to work at any time, subject to the
approval of respondent, and his visits to the plant to apply for work.
3. His filing of an illegal dismissal case.
Considering all these facts, established by the LA and confirmed by the
NLRC and the CA, we conclude that both appellate bodies were remiss in
declaring the existence of abandonment.
FACTS:
On 3 June 1997, petitioner Fianza was employed as Officer for Social
Acceptance of respondent Binga Hydroelectric Plant, Inc. The details of
his employment are embodied in Memorandum 97-103 dated 2 June 19974
issued by Mr. Catalino Tan, the president and chairperson of the board at that
time.
In February 1999, petitioner did not receive his salary of P15,000 for the
first 15 days of the month of February. He was advised not to report for
work until his status was officially clarified by the Manila office. After
petitioner made several other inquiries concerning his status, he was told
by a supervisor to report for work. However, he was also told that the new
management committee had to concur in his reappointment before he
could be reinstated in the payroll. It also wanted an opportunity to
determine whether his services would still be necessary to the company.
Meanwhile, the chief of the rehabilitation department of the company
recommended his return. As the management committee did not act on his
inquiries for several months, on 24 May 1999 petitioner filed a Complaint
for illegal dismissal before the LA.
LA: RULED IN FAVOR OF PETITIONER. It applied the
jurisprudentially-established control test to show that the petitioner and
respondent company had a prevailing employer-employee relationship. The
arbiter thought that since petitioner was hired directly by the president of the
company, he was entitled to a fixed income of P30,000. Moreover, despite the
existence of a controversy in respect of the corporation’s ownership and
rehabilitation, the employer-employee relationship subsisted on the basis of
the doctrine of successor employer. As to petitioner’s dismissal, the LA
recognized the obligation of the company to maintain complete records of its
personnel and transactions. It was further opined that there was no
abandonment because of respondent company’s failure to comply with
the strict requirements of the law for a declaration of abandonment.
Finally, for purposes of determining liability, the LA deemed petitioner a
“supervisory employee” and accordingly granted the benefits pertaining
thereto. The LA nonetheless denied the prayer for moral damages, having
seen no proof of malice on the part of respondent.
NLRC: REVERSED LA’s decision. It decided that the employer-employee
relationship was not sufficiently established, since the appointment letter
recognized the probationary status of petitioner. It found circumstances that
allegedly negated his permanent and regular employment, such as his direct
reporting to the hiring authority, his direct hiring which bypassed the existing
hiring procedures of the company, his lack of a daily time record, the absence
of the position “Social Acceptance Officer” from the organizational table of
the company, the characterization of his salary as “retainer’s fees,” and the
non-inclusion of his appointment in the company records.
CA: AFFIRMED NLRC’s reversal, and denied his motion for
reconsideration
CONTENTIONS OF PETITIONER: he was a supervisory employee, as
shown by the evidence he presented and the nature of his work. He further
contends that he did not abandon his work, because he always made sure
he followed up the status of his employment, and he was willing to go
back to work once he was re-enrolled in the payroll.
CONTENTION OF RESPONDENT COMPANY: asserts in its
Memorandum that petitioner was a confidential consultant of its former
president and chairperson Catalino Tan. As such, petitioner’s tenure was
therefore co-terminus with that of Mr. Tan.
ISSUE: W/N PETITIONER ABANDONED HIS WORK- NO
(NOTE: the nature of the employment is also an issue in this case. W/N
PETITIONER IS A REGULAR EMPLOYEE- YES. PETITIONER IS
ILLEGALLY DISMISSED)
RATIO:
1ST ISSUE: W/N PETITIONER ABANDONED HIS WORK
At the outset, it is clear that the requisites for a judicial declaration of
abandonment are absent in this case. Suffice it to say that abandonment is a
fact that must be proven in accordance with the standard set by this Court:
It is well-settled in our jurisprudence that “For abandonment to
constitute a valid cause for termination of employment, there
must be a deliberate, unjustified refusal of the employee to
resume his employment. This refusal must be clearly shown.
Mere absence is not sufficient, it must be accompanied by overt
acts unerringly pointing to the fact that the employee does not
want to work anymore” (Emphasis and italics supplied).
Abandonment as a fact and a defense can only be claimed as a ground for
dismissal if the employer follows the procedure set by law. In line with the
burden of proof set by law, the employer who alleges abandonment “has
the burden of proof to show a deliberate and unjustified refusal of the
employee to resume his employment without any intention of returning.”
As this Court has stated in Agabon v. National Labor Relations Commission:
For a valid finding of abandonment, these two factors should be
present: (1) the failure to report for work or absence without
valid or justifiable reason; and (2) a clear intention to sever
employer-employee relationship, 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 intent to discontinue the employment must
be shown by clear proof that it was deliberate and unjustified.
From the foregoing, it is clear that respondent company failed to prove the
necessary elements of abandonment. Additionally, the NLRC and the CA
failed to take into account the strict requirements set by jurisprudence when
they determined the existence of abandonment on the basis of mere
allegations that were contradicted by the evidence shown.
The very act of filing the Complaint for illegal dismissal should have
negated any intention on petitioner’s part to sever his employment. In
fact, it should already have been sufficient evidence to declare that there
was no abandonment of work. Moreover, petitioner went back to the
company several times to inquire about the status of his employment.
The fact that his inquiries were not answered does not prejudice this
position.
2. Identify problems in implementing ROL projects and offer
possible solutions that the company may adopt in resolving
conflicts.
3. Assist in monitoring the success and failure of the company’s
sponsored projects designed to help the social and economic
well-being of the people in the Itogon community.
4. Submit monthly report covering the above mentioned work.
5. In addition to the above, you may suggest to the management for
their consideration any program that will help attain the
corporation objectives as a partner for progress of the whole
province by the year 2000.
You will be under employment probation for two months during
which we will evaluate your performance and will serve as the basis
for permanent employment. Your compensation will be P25,000
monthly inclusive of all benefits.
Allow me to welcome you to the BHEPI family.

Throughout the entire ordeal, petitioner was vigilant in protecting himself
from any claim that he had abandoned his work. The following
circumstances evinced his intent to return to work:
1. His continuous inquiry with respondent about the status of his work.
2. His willingness to return to work at any time, subject to the
approval of respondent, and his visits to the plant to apply for work.
3. His filing of an illegal dismissal case.
Considering all these facts, established by the LA and confirmed by the
NLRC and the CA, we conclude that both appellate bodies were remiss in
declaring the existence of abandonment.
2ND ISSUE: W/N PETITIONER IS A REGULAR EMPLOYEE
Since the first question has been disposed of, the second one now becomes
the core issue, because the existence of an employer-employee relationship
in the nature of regular employment will determine whether or not the
company dismissed petitioner illegally.
Respondent company claims that because petitioner was a confidential
employee of its former president, his tenure was co-terminus with that of his
employer. To establish this contention, respondent cites the CA’s
determination of the facts, as follows:
1. Petitioner directly reported to Mr. Tan, the hiring authority.
4. The hiring did not pass through the existing procedure.
5. The position of officer for social acceptance was absent from the
company’s table of organization and position title.
6. Petitioner did not submit any daily time record.
7. Monthly fees received from Mr. Tan were denominated as retainer
fees and subjected to 10% deductions.
8. Petitioner was not included in the payroll.
9. The taxes on the fees were paid by respondent company on behalf
of petitioner.
10. Petitioner’s name was absent from respondent’s records.
SGD. Catalino Tan
Several things stand out in this appointment paper. First, its letterhead is
that of respondent company, indicating the official nature of the
document. Second, there is no indication that the employment is co-
terminus with that of the appointing power, or that the position was a
confidential one. In fact, alongside the obligation of petitioner to report to
Mr. Tan, is that of reporting to those whom the latter had designated as
well as to the management in case petitioner had any suggestion. This
description evinces a supervisory function, by which the employee will
carry out company policy, but can only give suggestions to management
as to the creation or implementation of a new policy.
Finally, the appointment paper recognizes that the petitioner would
initially be on probation status for two months, at the end of which he
would be made a permanent employee should his services be found
satisfactory by respondent. All these circumstances are evident from the
appointment paper itself, which belies the claim of respondent that it had
no employer-employee relationship with petitioner.
For the foregoing reasons, this Court must assess whether it was a reversible
error of law for the appellate court to rule that there was no grave abuse of
discretion that amounted to a lack or an excess of jurisdiction on the part of
the NLRC when it reversed the findings of the LA. Since what is at stake in
this case is the proper application of the doctrine of abandonment and the
legal concept of regular employment, it is clear to this Court that the CA
indeed committed a reversible error, and that petitioner was therefore
unjustly and illegally dismissed.

These facts allegedly proved that petitioner was the confidential employee of
Mr. Tan, respondent’s former president. All of this occurred in the context of
a rehabilitation receivership conducted by the Securities and Exchange
Commission Management Committee.

Respondent company failed to realize however that Mr. Tan, being its
president, was clothed with authority to hire employees on its behalf.
This was precisely the import of petitioner’s appointment papers, which
even carried the letterhead of the company. There is no indication from
the facts that his employment was of a confidential nature. The wording of
his appointment itself does not bear out that conclusion, viz:
To: Mr. Alfonso Fianza
From: Mr. Catalino Tan
Subject: Job and Responsibilities
Date: June 2, 1997
No: Mem97-10

This is to confirm your appointment as officer for social acceptance

of BHEPI projects effective June 3, 1997. In this position, you will
be directly reporting to me and to those whom I will designate to
assure compliance and attainment of our corporate objectives in
relation to the reforestation program, silt control, and the social and
livelihood projects to lift up the [unintelligible word] condition of
the residence in your area of operations. Specifically, your job and
responsibilities are:cralavvonlinelawlibrary
1. Promote social acceptance by the local residence of the Itogon
and the nearby municipalities of the corporate projects as
required in the ROL contract and the Supplemental Agreement
signed by the company with the National Power Corporation.
G.R. No. 140555 July 14, 2005 Petitioner also asserted that it validly terminated the services of respondents
due to abandonment of work and that the matter had been reported to the
Department of Labor and Employment. Calacday pointed out that he should
NEW EVER MARKETING, INC., Petitioners, vs.
be excluded from being a party to the case as petitioner has a separate and
HON. COURT OF APPEALS, ESPIRITU YLANAN, CESAR FULO,
distinct personality.
and WILFREDO BILASA, Respondents.

On May 3, 1996, the Labor Arbiter (LA) rendered a decision dismissing the
DECISION
complaint for illegal dismissal on the ground that petitioner had a just cause to
dismiss respondents, i.e., for abandonment of work, and that petitioner had
AZCUNA, J.: complied with the notice requirement prior to terminating their employment.
However, the labor arbiter ordered petitioner to pay the monetary claims of
respondents for unpaid wages, 13th month pay, and service incentive leave
Petitioner New Ever Marketing, Inc. hired respondents Espiritu Ylanan and pay for the year 1994 since there was no proof that the same had been paid.
Cesar Fulo as drivers and Wilfredo Bilasa as delivery man (pahinante)
commencing in February 1987, November 1988, and June 1989, respectively.
Respondents filed against petitioner and Marcelo Calacday, its General Respondents interposed a partial appeal to the National Labor Relations
Manager, a complaint for illegal dismissal and sought the payment of Commission (NLRC) on the dismissal of the complaint for illegal dismissal
overtime pay, premium pay for services rendered during holidays, service and the other monetary claims against petitioner.
incentive leave, and 13th month pay for the year 1994. They also filed a
separate case against petitioner with the Social Security System for alleged
On June 16, 1997, the NLRC modified the decision of the LA. It found
non-remittance of SSS premiums.
petitioner guilty of constructively dismissing respondents. The NLRC ordered
petitioner to reinstate respondents to their positions without loss of seniority
In their complaints, respondents alleged, as follows: rights and other privileges appurtenant thereto, with the payment of full
backwages from the time they were illegally dismissed until actual
reinstatement. The pertinent portions of the NLRC’s decision state:
Respondent Ylanan: That a fine of ₱500.00 for a traffic violation he
committed on September 12, 1994, supposedly for the account of the
petitioner, was deducted from his salary for September 17, 1994; that for his In his Decision, however, the Labor Arbiter a quo gave undue credence to
October 15, 1994 salary, deductions were made for SSS premiums respondents’ claims that complainants herein abandoned their jobs after
corresponding to the months of January and February 1993, but apparently, memoranda were allegedly sent to them directing them to explain why no
the same were not accordingly remitted; that from October 17-22, 1994, he disciplinary action should be taken against them for having been absent
did not report for work because he attended to an errand; that when he without the necessary leave application (Annexes "1," "3" and "7,"
reported back for work on October 24, 1994 and October 25, 1994 (with Respondent’s Position Paper).
respondents Fulo and Bilasa), he was barred from entering the premises and
instructed to wait for a certain Ding who later arrived at noon time, after he
A close examination of the aforesaid memos, however, readily reveals the
had left the premises; that when he called the office the next day, October 26,
absence of proof that they were indeed sent to, much less received by, the
1994, Sally, the office secretary, told him to report for work on October 31,
herein complainants. Certainly, such absence is fatal, more so under
1994; that when he reported for work on October 31, 1994, petitioner
complainants’ vehement denial that they ever received such memos. Clearly,
company was closed and the company guard told him to come back on
under this fact, such memos cannot take the place of notice to comply with
November 2, 1994; that when he arrived on November 2, 1994, the company
the requisite of a valid notice in administrative due process.
guard again told him to wait for Ding who arrived at noon time after he had
left; and that on November 3, 1994, Calacday informed him and respondent
Fulo that they were considered as "AWOL [absent without official leave]." Moreover, in cases of abandonment, the absence of "animus revertendi" must
be clearly proven. Respondent, We find, failed to discharge this burden. It
failed to show that complainants indeed no longer intended to return to their
Respondent Fulo: That on October 15, 1994, petitioner asked him to secure a
jobs inspite of due notice afforded to them to do so.
new Community Tax Certificate; that as October 16, 1994 was a Sunday, he
did not report for work the following day, October 17, 1994, to be able to
secure one; that when he reported for work on October 18, 1994, he was On the contrary, We are convinced that the proximity of the filing of their
prevented by the company guard from entering the company premises and complaint with what they perceive to be the unreasonable arrival of "Ding" as
asked to wait for Ding who did not arrive until noon that day, so he went they were instructed to wait for, is concrete proof sufficient to show that they
home; that from October 19 to November 2, 1994, he reported for work daily, have the least intention to give up their job, much less abandon the same.
but was made to wait for Ding; and that because of the foregoing, he and the
two other respondents were constrained to file a complaint for illegal
It is not amiss to state at this juncture that during the period they were waiting
dismissal against the petitioner and Calacday.
for the said "Ding" to arrive, they were not allowed to work and their daily
time records would show no attendance, but such cannot be taken against
Respondent Bilasa: That on October 17, 1994, he was sent home due to his them.
allergies; that because of his condition, he informed Calacday that he may not
be able to report for work the following day; that the next day, October 18,
Suffice it to state that We are far from convinced of respondents’ claims that
1994, he was absent as his allergy had not subsided; that after seeking
complainants[‘] services were terminated for cause. Conversely, we are
medical attention, the doctor advised him to take a leave of absence for one
convinced that complainants were indeed instructed to wait for a certain
week; that when he reported for work on October 24, 1994, he was denied
"Ding" as a condition precedent for their resumption of work. The waiting for
entry to the premises until Ding arrived; and that he never received any letter
the said "Ding" for an unreasonable length of time certainly cannot prevent[,]
from the petitioner informing him that he had abandoned his work.
much less preclude[,] herein complainants from filing the instant case. They
were undoubtedly constructively dismissed at the time of the filing of their
For its part, as to respondents Fulo and Ylanan, petitioner countered: That complaint.
starting October 17, 1994, they failed to report for work without filing a leave
of absence; that on October 21, 1994, Calacday sent a letter requiring them to
WHEREFORE, the decision appealed from is hereby MODIFIED in that
explain why no disciplinary action should be taken against them for violating
Respondents are hereby declared guilty of illegally and constructively
company rules on absences and tardiness; that despite receipt of the said
terminating the services of complainants Espiritu Ylanan, Cesar Fulo and
letter, respondents did not submit any written explanation; and that on
Wilfredo Bilasa. Further, respondents are ordered to reinstate them to their
November 4, 1994, petitioner sent another letter informing them that they
former position[s] without loss of seniority rights and other privileges
were deemed to have abandoned their jobs.
appurtenant thereto with full backwages from the time of their dismissal until
actually reinstated. The other dispositions in the appealed decision are
As to respondent Bilasa, petitioner averred: That on October 19, 1994, deemed final and executory.
respondent Bilasa was absent from work without filing a leave of absence;
that on October 23, 1994, petitioner sent him a memorandum, directing him to
SO ORDERED.1
explain why no disciplinary action should be taken against him for being
absent, but he failed to do so; and that on November 4, 1994, petitioner gave
another memorandum informing Bilasa that he was deemed to have On petition for review, the Court of Appeals (CA) dismissed petitioner’s
abandoned his job for failure to explain his unexcused absences. action and later denied its motions for reconsideration.
Petitioner seeks to annul the Resolution of the Court of Appeals dismissing its respondents, before the filing of said petition. The clear import of the
petition, dated March 16, 1999, and the Resolutions denying reconsiderations, provisions does not reasonably admit of any other interpretation.
dated September 24, 1999 and October 27, 1999, by "invok[ing] the power of
the Court under Rule 65 of the 1997 Rules of Civil Procedure because there is
Finally, even if this Court were to treat the present petition as a petition for
no appeal or any plain, speedy and adequate remedy in the ordinary course of
review on certiorari under Rule 45 and overlook its procedural infirmity, the
law" and stating that "this petition is not in any way intended to delay the
same would still be denied for lack of merit.
decision of the [NLRC] dated June [16], 1997, but the undersigned new
counsel for the petitioner is exhausting all legal remedies available to the
petitioner." First. Petitioner asserts that through its General Manager, Marcelo Calacday,
it had sent a letter requiring the respondents to explain why it should not take
disciplinary actions against them for violation of company rules on absences
A perusal of the antecedents shows that petitioner’s petition
and tardiness; that despite receipt of the said letter, respondents did not submit
for certiorari (with prayer for the issuance of a writ of preliminary injunction)
any written explanation thereto; and that, thereafter, it sent another letter
filed with the CA was dismissed outright in a Resolution dated March 16,
informing them that they were deemed to have abandoned their jobs.
1999 on two grounds, namely, failure to attach an affidavit of service as proof
that a copy of its petition had been duly served upon the NLRC and the
respondents, and lack of allegations as to material dates to show the These allegations have not been sufficiently proven. Under the Labor Code,
timeliness of the filing of the petition pursuant to Section 3, Rule 46 in there are twin requirements to justify a valid dismissal from employment: (a)
relation to Section 4, Rule 65 of the Rules of Civil Procedure. the dismissal must be for any of the causes provided in Article 282 of the
Labor Code (substantive aspect) and (b) the employee must be given an
opportunity to be heard and defend himself (procedural aspect). 4 As to
After receiving a copy of the Resolution dated March 16, 1999 on March 26,
procedural aspect, two notices are required: (a) written notice containing a
1999, petitioner, on April 7, 1999 (through its former counsel), filed a motion
statement of the cause for termination, to afford the employee an opportunity
for reconsideration and supplement to the motion for reconsideration.
to be heard and defend himself with the assistance of his representative, if he
Petitioner’s motion alleged that its failure to furnish the NLRC and the
desires; and (b) if the employer decides to terminate the services of the
respondents with copies of the petition was due to "an honest but excusable
employee, written notice must be given to the employee stating clearly the
mistake in the interpretation and application of Section 6, Rule 65 of the
reason therefor.5 The records reveal that petitioner did not
Rules of Court." It insisted that its interpretation of the provision was that the
adduce evidence that it had served the respondents with copies of the
copies of the petition would be furnished to the NLRC and the respondents
memoranda (re explanation for their unauthorized absences) and the
only after the Court of Appeals finds its petition to be sufficient in form and
subsequent memoranda (re its decision to terminate their employment due to
substance.
abandonment) and that the same were actually received by each of the
respondents. Petitioner’s bare assertion failed to overcome the declarations of
On September 24, 1999, the appeals court denied petitioner’s motion for the respondents that they never received copies of the memoranda.
reconsideration for lack of merit, stating that it was bound by the negligence
and mistake of its counsel and, likewise, denied its prayer for the issuance of
Second. Petitioner maintains that it had validly dismissed the respondents for
a temporary restraining order for being moot and academic. Petitioner
incurring absences without filing the application for leave which was
received a copy of the said Resolution on October 13, 1999. On October 21,
tantamount to an abandonment of work and that the respondents did not
1999, petitioner’s former counsel filed a notice of withdrawal of appearance.
report for work after the two memoranda had been sent to them individually.
On the same day, October 21, 1999, petitioner’s new counsel filed an entry of
appearance and sought another reconsideration invoking substantial justice
and its subsequent compliance with the procedural rules. On October 27, This contention has no merit. The substantive aspect for a valid dismissal
1999, the CA denied the second motion for reconsideration for being a provides that to constitute abandonment of work, two (2) requisites must
prohibited pleading under Section 2, Rule 52 of the Rules of Court. Petitioner concur: (a) the employee must have failed to report for work or must have
received a copy of the Resolution on November 8, 1999. On November 17, been absent without justifiable reason; and (b) there must have been a clear
1999, petitioner filed with this Court its petition for certiorari under Rule 65 intention on the part of the employee to sever the employer-employee
of the Rules of Court. relationship as manifested by overt acts. Abandonment as a just ground for
dismissal requires deliberate, unjustified refusal of the employee to resume
his employment. Mere absence or failure to report for work, after notice to
The petition is based on a misapprehension of procedural rules. It bears
return, is not enough to amount to abandonment. Moreover, abandonment is a
stressing that when petitioner, on October 13, 1999, received a copy of the
matter of intention; it cannot be inferred or presumed from equivocal acts.6 In
CA Resolution dated September 24, 1999 denying its motion for
this case, respondents had sought permission and had informed petitioner of
reconsideration, it had fifteen (15) days from receipt thereof within which to
their reasons for being absent and had reported back to petitioner's office the
file a petition for review on certiorari under Sections 1 and 2, Rule 45 of the
following day. It cannot be said that respondents had abandoned their work
Rules of Court. Section 2 thereof also allows petitioner to file, within the 15-
during the period the absences in question were incurred. It became a strange
day period, a motion for extension of time of thirty (30) days within which to
scenario for them to be reporting for work early in the morning only to be told
file such petition. This is because the CA Resolution dated March 16, 1999
to wait for Ding who would arrive at noon time. In the meantime, they were
which outrightly dismissed its petition for non-compliance with the
not even allowed to enter the premises or do their assigned tasks. This being
procedural rules, and the Resolution dated September 24, 1999, which denied
so, respondents sought recourse by filing an illegal dismissal case against
its motion for reconsideration, partake of the nature of a final disposition of
petitioner. Clearly, respondents never intended to sever the employer-
the case. Hence, the appropriate remedy to this Court is a petition for review
employee relation and abandon their work. On the contrary, they clearly
on certiorari under Rule 45, not a petition for certiorari  under Rule 65. In
showed their desire to continue their employment with petitioner and to be
this case, petitioner filed a second motion for reconsideration which the CA
reinstated to their former positions. Indeed, an employee who loses no time in
correctly denied for being a prohibited motion. The filing of a prohibited
protesting his layoff cannot by any reasoning be said to have abandoned his
motion did not interrupt the running of the 15-day reglementary
work, for it is well-settled that the filing by an employee of a complaint for
period2 within which petitioner should have filed the petition under Rule 45.
illegal dismissal with a prayer for reinstatement is proof enough of his desire
to return to work, thus, negating the employer’s charge of abandonment.7
This petition for certiorari under Rule 65 should, therefore, be dismissed for
being the wrong remedy. The rule is that the special civil action
All the antecedents show that petitioner had constructively dismissed the
of certiorari under Rule 65 is not, and cannot be, a substitute for a lost
respondents. Constructive dismissal is defined as quitting when continued
remedy of appeal, especially if the loss is occasioned by the petitioner’s own
employment is rendered impossible, unreasonable or unlikely as the offer of
neglect or error in the choice of remedies.3
employment involves a demotion in rank and diminution of pay. 8 In this case,
respondents were deemed constructively dismissed because whenever they
Petitioner, however, invokes substantial justice on the reasoning that the would report for work in the morning, they were barred, without any
failure of its former counsel to furnish copies of the petition to the NLRC and justifiable reason, by petitioner’s guard from entering the premises and were
the private respondents was not due to an error of law, but to an error in the made to wait for Ding who would arrive in the office at around noon, after
interpretation of the provision of Section 6, Rule 65 of the Rules of Court they had waited for a long time and had left.
which should be considered as an excusable mistake.
Petitioner, therefore, failed to prove by clear and convincing evidence that
The submission is untenable. Section 1, Rule 65 in relation to Section 3, Rule there was just cause for terminating the employment of respondents and that
46 of the Rules of Court, clearly states that in a petition filed originally in the there was compliance with the two-notice rule. Article 277(b) of the Labor
Court of Appeals, the petitioner is required to serve copies of the petition, Code places the burden of proving that the termination of employment was
together with the annexes thereto, on the lower court or tribunal concerned, in for a valid or authorized cause on the employer. The employer’s failure to
this case, the NLRC, and on the adverse parties, the herein discharge this burden means that the dismissal is not justified and the
employee is entitled to reinstatement. In this case, petitioner failed to establish
that respondents deliberately and unjustifiably refused to resume their
employment without any intention of returning thereto.

Under Article 279 of the Labor Code, an employee who is unjustly dismissed
is entitled to reinstatement, without loss of seniority rights and other
privileges, and to the payment of his full backwages, inclusive of allowances,
and other benefits or their monetary equivalent, computed from the time his
compensation was withheld up to the time of his actual reinstatement. 9 Thus,
respondents are entitled to reinstatement with the payment of full backwages
from the time their compensations were withheld, i.e., from the time of their
illegal dismissal, up to the time of their actual reinstatement.

WHEREFORE, the petition is DISMISSED, without costs.

G.R. No. 172670               January 20, 2009
RBC CABLE MASTER SYSTEM AND/OR EVELYN
CINENSE, Petitioners, vs.
MARCIAL BALUYOT, Respondent.
DECISION
PUNO, C.J.:
This is a petition for review of the Decision 1 of the Court of Appeals in CA-
G.R. SP No. 85254 which modified the Decision2 of the National Labor
Relations Commission (NLRC) in NLRC NCR CA No. 034129-03. The
NLRC reversed the Decision3 of the Labor Arbiter in RAB II CN. 01-0007-02
dismissing the complaint for illegal dismissal filed by respondent Marcial
Baluyot against petitioners RBC Cable Master System and/or Evelyn
Cinense. On certiorari, the Court of Appeals affirmed the NLRC’s finding
that respondent was illegally dismissed with modification of the award of
separation pay.
As found by the Court of Appeals, the facts are as follows:
Herein petitioner RBC Cable Master System (petitioner RBC) is a cable firm
engaged in the business of providing home cable service, owned and managed
by Engr. Reynaldo Cinense and his wife, co-petitioner Evelyn Cinense.
Sometime in March 1996, petitioner RBC hired herein private respondent
Marcial Baluyot as a Lineman. As lineman, private respondent received a
compensation of P110.00 per day plus an allowance of P100 as driver of the
motorcycle he leased to petitioner. He was also given free gasoline and
maintenance allowance, free cable subscription and other benefits accorded
by law. In 1999, private respondent was appointed as collector, which
position he held up to March 2001 when he was allegedly illegally dismissed.
Beginning March 2000, petitioner RBC imposed a new salary scheme for
collectors where they are no longer paid monthly salaries and instead their
remuneration was computed at the rate of 5% percent (sic) based on the total
collections for a given month.
In the middle part of the year 2000, private respondent learned that his
outstanding loan from cash advances accumulated to P18,000.00. The cash
advances he made [were] pursuant to a long time practice for the employees
of petitioner RBC to advance amounts of money in the form of cash vales
with the condition that the same be deducted from their monthly salaries on a
staggered or periodic basis.
Private respondent averred that upon the urgings of petitioner for him to
promptly settled (sic) his obligations, the latter delivered a Yamaha
motorcycle registered in his name, valued at P40,000.00 as a security for the
loan. This agreement was evidenced by a Deed of Chattel mortgage executed
in favor of petitioner RBC.
Petitioner RBC, on the other hand, alleged that it leased the said motorcycle
from private respondent in connection with its various cable TV operations,
for an agreed price of P100.00 per day. The lease of the motorcycle was
terminated only after private respondent ceased owning the said motorcycle
for failing to pay Eagle Financial Services, Group inc. (sic), his monthly
amortizations for the same and after the motorcycle was re-possessed by said
financing company. Petitioner RBC eventually purchased from Eagle
Financial Services the said motorcycle for use in its Cable TV business.
On February 1, 2001, when private respondent reported for work, he was
informed that no blank official receipts could be issued to him for his
collection job for that day or for a month because he is being suspended.
Thus, for one month, he did not report for work and when he reported back to
duty, he was told by petitioner RBC that he is now out of job and is
considered terminated.
Petitioner RBC denied dismissing private respondent by contending that it
was private respondent who abandoned his work, when, sometime in March
2001, he left without any notice and never returned back for work. Petitioner
RBC also alleged that private respondent in the course of his employment,
committed several infractions, to wit:
a) On several occasions, private respondent Marcial Baluyot did
not issue Official Receipts to subscribers for the monthly
subscriptions and dues he collected from them;
b) Worst, private respondent willfully and deliberately did not
remit to petitioner the amounts he collected from said subscribers.
c) That private respondent misappropriated said amounts for his
own personal use. Because of private respondent’s
misappropriation of his collection of monthly cable rentals and
subscription fees and theft of money belonging to petitioner, the
latter filed a criminal case for Estafa against private respondent.
d) In order to cover up his misappropriations, private respondent
falsified documents by making it appear that three customers paid
to him in checks. The said checks were remitted to petitioner RBC
but which all bounced because the account was already closed.
And upon inquiry it was discovered that said checks were drawn
against the current account of private respondent’s wife who was
then abroad. Because of this incident, petitioner RBC filed another
Criminal case against private respondent for Falsification arising
from his acts of forging and falsifying the aforementioned checks
to be able to cover up for the amounts he misappropriated.
e) That private respondent was also engaged in illegal installation
of cable lines to TV sets of persons who are not clients of
petitioner.
f) That private respondent also twice stole a motorcycle belonging
to petitioner RBC resulting in the filing of a criminal case against
him for qualified theft.
Because of the foregoing infractions and misdeeds allegedly committed by
private respondent, petitioner RBC was forced to suspend private respondent
for one (1) month effective February 1, 2001 to February 28, 2001.
Thereafter, private respondent was recalled back to work on March 1, 2001
and he executed a promissory note for the amount of his unremitted
collections which included an undertaking that he will not repeat his various
infractions, otherwise, he submits himself to automatic termination of his
employment. Petitioner RBC, however alleged that sometime in the same
month of March 2001, private respondent did not report for work without
permission from and/or prior notice to petitioner that is why petitioner
considered private respondent absent without official leave (AWOL).
Private respondent however contended that after his suspension, he reported
back to work. Upon his return, petitioner RBC told him that he is now out of
job and is considered terminated. Thus, on January 8, 2002, private
respondent filed a case for illegal dismissal before the Regional Arbitration
Board in Tuguegarao City, Cagayan.
On November 5, 2002, the labor arbiter rendered a decision dismissing the
complaint for illegal dismissal for lack [of] merit. The Labor Arbiter anchored
his decision on the strength of his finding that private respondent abandoned
his job and committed acts of dishonesty such as theft of company funds and
property.
On appeal, the National Labor Relations Commission (NLRC), in the now
assailed Decision dated December 10, 2003 reversed and set aside the
decision of the labor arbiter and ruled that private respondent did not abandon
his job but was illegally dismissed. The dispositive portion of the said assailed
decision reads as follows:
WHEREFORE, finding merit in the appeal, the decision dated November 5,
2002 is hereby reversed and set aside. A new judgment is entered finding
respondents to have illegally dismissed complainant from his employment.
Accordingly, respondents are hereby ordered to pay complainant his
backwages from March 1, 2001 to November 5, 2002, the date of the decision
of the labor arbiter. In addition complainant is entitled to separation pay in
lieu of reinstatement equivalent to one-half (1/2) pay for every year of service
from March 1996 to March 2001 based on his wage rate of P4,200. (Rollo,
pp. 23-24)4
As aforestated, the Court of Appeals affirmed the decision of the NLRC with
the modification that the award of separation pay be computed at one (1)
month pay for every year of service reckoned from March 1, 2001 up to
finality of its decision as follows:
WHEREFORE, in view of the foregoing, the instant Petition for Certiorari is
DENIED and the assailed Decision of the National Labor Relations
Commission dated December 10, 2003 is hereby AFFIRMED with
modification that the award of separation pay be computed at one (1) month
pay for every year of service reckoned from March 1, 2001 up to the finality
of this decision.5
A motion for reconsideration of the Court of Appeals’ decision was filed but
the same was denied in a Resolution6 dated April 10, 2006.
Hence, this Petition, raising the following grounds:
A. The Court of Appeals abused its discretion amounting to lack
or excess of jurisdiction in impliedly acknowledging that the
NLRC can pass upon and resolve an un-litigated issue
(abandonment) by making use of the same un-litigated issue to
justify its finding of illegal dismissal.
B. The Court of Appeals abused its discretion amounting to lack or
excess of jurisdiction in ruling that there was no abandonment
even if it had no factual or legal basis for such finding.
C. The Court of Appeals abused its discretion amounting to lack or
excess of jurisdiction in ruling that private respondent was
illegally dismissed despite overwhelming evidence of acts of
dishonesty such as misappropriation of collections, falsification of
documents to cover up said misappropriation, theft of company
funds and property as well as abandonment – all Just Causes for
Dismissal under Article 282 of the Labor Code of the Philippines
as amended.
D. The Court of Appeals abused its discretion amounting to lack
or excess of jurisdiction in ruling that the acts of dishonesty and
other infractions were already condoned by petitioner since private
respondent was already suspended and was even required to report
back to work after his suspension.
E. The Court of Appeals abused its discretion amounting to lack or
excess of jurisdiction in affirming the NLRC’s award of
Backwages and Separation Pay.7
The petition is unmeritorious.
There are two key issues in this case: (1) whether the issue of abandonment
cannot be passed upon by the NLRC for not being raised on appeal; and (2)
on the basis of other grounds, whether respondent was illegally dismissed.
On the first issue, we hold that the NLRC did not abuse its discretion when it
resolved the issue on abandonment. Petitioners argue that the NLRC
committed grave abuse of discretion when it went beyond the issues raised
before it on appeal. Petitioners contend that Rule IV, Section 3-C of the 1990
NLRC Rules of Procedure limits the review powers of the NLRC in cases of
perfected appeals, to those specific issues raised on appeal. According to
petitioners, the assignment of errors in respondent’s Appeal
Memorandum8 before the NLRC did not question the fact that he abandoned
his job since nowhere therein did he raise any issue regarding the matter of
abandonment.
We disagree. Respondent’s Appeal Memorandum states:
GROUNDS FOR APPEAL:
1. THERE IS EVIDENCE OF GRAVE ABUSE OF
DISCRETION ON THE PART OF THE LABOR ARBITER;
AND
2. THERE ARE SERIOUS ERRORS IN HIS FINDINGS OF
FACT WHICH WOULD CAUSE GRAVE OR IRREPARABLE
DAMAGE OR INJURY TO THE APPELLANTS.
ASSIGNMENT OF ERRORS:
1. The Honorable Executive Labor Arbiter committed serious error
in dismissing the above-entitled case for lack of merit;
2. The Honorable Executive Labor Arbiter erred seriously IN
admitting respondent’s position paper after issuing an order
submitting the case for resolution;
3. The Honorable Executive Labor Arbiter gravely erred in not
expunging the respondent’s position paper from the records;
4. The Executive Labor Arbiter committed serious error in
misconstruing Annexes "L" and "M" presented by Appellee as
admission of the offenses imputed against appellant;
5. the executive labor arbiter committed serious error in failing to
appreciate the evidences presented by appellant[.]9 (Emphasis
added)
Although respondent did not specifically cite abandonment above, it is
evident from the foregoing that he questioned the Labor Arbiter’s factual
finding that he was not illegally dismissed in his appeal before the NLRC.
Moreover, contrary to petitioners’ assertion, respondent never admitted that
he abandoned his job. A perusal of respondent’s pleadings filed in the
proceedings below shows that he maintained that he did not abandon his job
and the reason why he did not report to work for a month was because he was
suspended by petitioners. Indeed, the pivotal issue in this case is whether or
not he was illegally dismissed. The matter of abandonment has to be
necessarily discussed for being corollary to the main issue of illegal dismissal.
Petitioners’ argument that the issue of abandonment was not properly raised
on appeal is therefore incorrect. At any rate, an unassigned error closely
related to the error properly assigned, or upon which the determination of the
question raised by the error properly assigned is dependent, will be
considered by the appellate court notwithstanding the failure to assign it as
error.10
Now, on the other issues.
It is elementary rule that the Supreme Court is not a trier of facts. However,
since the findings of the Labor Arbiter, on one hand, and the NLRC and the
Court of Appeals, on the other, are conflicting, we are constrained to
determine the facts of the case.
There are two reasons given by petitioners to support their contention that
respondent was not illegally dismissed. First, respondent committed several
infractions during the course of his employment. Second, respondent
abandoned his job.
After a careful review of the case, we find sufficient evidence to warrant the
finding that respondent was illegally dismissed.
First, we note that the memoranda11 covering the alleged infractions
committed by respondent during the course of his employment and
respondent’s written explanations12 thereto were all executed prior to the
Promissory Note13 dated March 5, 2001 signed by respondent which states:
I, Marcial Baluyot, an authorized collector commission basis of RBC CABLE
has been earlier suspended due to unauthorized spending of my collection
worth P6,330.00 pesos.
On March 1, 2001, I had been (sic) reported back to work with a promised
(sic) not to repeat the abovementioned violation, otherwise, I will submit
myself for automatic termination from my work.
Furthermore, I promised (sic) to pay the amount of P7,279.50 pesos including
the interest equivalent to the amount spent with in (sic) a period of 3 (three)
months which will be deducted from my commission, every 15th and 30th of
the month.
As can be gleaned above, after respondent was punished with suspension by
petitioners, he was admitted back to work on the condition that he will not
repeat the same violations and he will pay back the sums he owed. Hence, we
agree with the Court of Appeals that these prove that petitioners had
condoned the infractions previously committed by the respondent.
Petitioners, however, insist that there was no condonation of the misdeeds
committed by respondent. According to petitioners, the suspension of
respondent was in the nature of a preventive suspension and he was admitted
back to work in order for him to face the administrative process. Also,
petitioners contend that the alleged penalty imposed upon respondent only
pertains to the unauthorized appropriation of the amount of ₱6,330.00 and not
to his other acts of dishonesty such as theft of company funds and property,
illegal installation of cable lines and falsification of checks. It is also
contended that the said promissory note was merely intended to prove the
civil liability of respondent for the amount he misappropriated. In the case at bar, considering the strained relations between the parties
brought about by petitioners’ filing of criminal cases against respondent,
reinstatement is not viable. The Court of Appeals is therefore correct in
Petitioners’ arguments deserve scant consideration. The tenor of the
awarding separation pay equivalent to one (1) month pay for every year of
promissory note stating the conditions under which he will be admitted back
service computed from the date of his illegal dismissal on March 1, 2001 up
to work negates petitioners’ argument that his suspension was only preventive
to the finality of the decision.
in nature. The facts that: (1) the other infractions were already known to
petitioners and they have accepted respondent’s explanations on the same
prior to the execution of the promissory note; and (2) they continued to IN VIEW WHEREOF, the petition is DENIED. The decision of the Court of
employ him thereafter lead us to believe that the penalty imposed covered his Appeals is affirmed.
other infractions. Moreover, it should be noted that the promissory note
obliges respondent to pay ₱7,279.50 with interest for a period of three (3)
SO ORDERED.
months which clearly contradicts petitioners’ assertion that the penalty
imposed was only for the misappropriation of the sum of ₱6,330.00.

We therefore affirm the finding of the Court of Appeals that the real
controversy arose only when, after the execution of the promissory note,
respondent allegedly failed to report back to work without notice to
petitioners.

To constitute abandonment, two elements must concur: (1) the failure to

report for work or absence without valid or justifiable reason, and (2) a clear
intention to sever the employer-employee relationship, with the second
element as the more determinative factor and being manifested by some overt
acts. Mere absence is not sufficient. The employer has the burden of proof to
show a deliberate and unjustified refusal of the employee to resume his
employment without any intention of returning.14

The evidence in the case at bar shows that respondent has always humbly
accepted his fault and asked for petitioners’ forgiveness, to wit:

xxx

Ipagdarasal ko sa Diyos na sana palambutin ang inyong puso at bigyan pa po

ninyo ako nang isang pang pagkakataong mapatunayan ang pagmamalasakit
ko sa kompanyang ito at tuluyang maituwid ang aking pagkakamali.15

Hence, we find it hard to believe that he will just abandon his job after
petitioners gave him a chance to continue working for them. We uphold the
following findings of the Court of Appeals that respondent did not abandon
his job:

In the case at bar, the charge of abandonment is belied by the following

circumstances: First, the high improbability of private respondent to
intentionally abandon his work considering that he had already served a
penalty of suspension for his infractions and violations as well as the
petitioner’s tacit condonation of the infractions he committed, by permitting
him to go back to work and by asking him to execute a promissory note. It is
incongruent to human nature, that after having ironed things out with his
employer, an employee would just not report for work for no apparent reason.
Secondly, there was no proof that petitioner sent private respondent a notice
of termination on the ground of abandonment, if indeed it is true that he really
failed to go back to work. Section 2, Rule XVI, Book V, Rules and
regulations implementing the Labor Code provides that any employer who
seeks to dismiss a worker shall furnish him a written notice stating the
particular act or omission constituting the ground for his dismissal. In cases of
abandonment of work, the notice shall be served at the worker’s last known
address (Icawat vs. National Labor Relations Commission, 334 SCRA 75, 81
[2000]). For this reason, We are constrained to give credence to private
respondent’s assertion that he attempted to report back to work but he was
just asked to leave as he was considered terminated. And lastly, private
respondent’s filing of a case for illegal dismissal with the labor arbiter negates
abandonment. As held by the Supreme Court, a charge of abandonment is
totally inconsistent with the immediate filing of a complaint for illegal
dismissal, more so when it includes a prayer for reinstatement (Globe
Telecom, Inc. vs Florendo-Flores, 390 SCRA 201, 2002[sic]-203 [2002]).16

Finally, an employee who is illegally dismissed is entitled to the twin reliefs

of full backwages and reinstatement. If reinstatement is not viable, separation
pay is awarded to the employee.17 In awarding separation pay to an illegally
dismissed employee, in lieu of reinstatement, the amount to be awarded shall
be equivalent to one (1) month salary for every year of service.18 Under
Republic Act No. 6715, employees who are illegally dismissed are entitled to
full backwages, inclusive of allowances and other benefits or their monetary
equivalent, 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, the backwages shall be computed from the time of their
illegal termination up to the finality of the decision.19
G.R. No. 167953             April 3, 2007 2. Pay complainant the following:

DANNY MAME, Petitioner, vs. a) holiday pay

COURT OF APPEALS, NATIONAL LABOR RELATIONS
COMMISSION, VIRGILIO CUERPO and NORILYN
b) holiday premium pay
CUERPO, Respondents.

c) service incentive leave pay

DECISION

d) 13th month pay

CALLEJO, SR., J.:

3. Pay complainant moral and exemplary damages in a sum as the

This is a Petition for Review on Certiorari of the Decision 1 of the Court of
Honorable Office may deem just and equitable under the premises;
Appeals (CA) in CA-G.R. SP No. 81797 and its Resolution 2 denying the
motion for reconsideration thereof.
4. Pay complainant attorney’s fees.
The antecedent facts are as follows:
Other reliefs just and equitable under the premises are, likewise, prayed for.4
The spouses Virgilio and Norilyn Cuerpo were engaged in the construction
business under the business name "V.C. Building Trade and Woodworks." In their Position Paper, respondents averred that petitioner walked out from
They employed carpenters and workers, including petitioner Danny Mame, his employment and abandoned his work. They had the right to call his
who was tasked to supervise their workers at the Bonifacio Firing Range attention since his work was deficient. Instead of being remorseful,
project. In January 1988, the couple promoted Mame to foreman carpenter for complainant even threatened to convince his co-workers to walk out from
the following projects: their jobs. In her reply, respondent Norilyn denied that she terminated the
employment of complainant and insulted him on September 21, 2001.
Petitioner was a troublemaker and had difficulty with authority figures.
PROJECT LOCATION
Aureliade Residence Las Pinas-Alabang On September 30, 2002, the Labor Arbiter rendered a Decision dismissing the
complaint for lack of merit. The Labor Arbiter found that it was complainant
Gruit Residence San Juan, M.M. who walked out on respondents when his attention was called due to his poor
Caraan Residence Valle Verde, Pasig installation of the narra planks in the Bayot residence.1a\^/phi1.net He had no
one to blame but himself for losing his job.5 The dispositive portion of the
Alexandra Condo. Ortigas Ave., Pasig decision reads:
Center Point Building Meralco Avenue
WHEREFORE, judgment is hereby rendered dismissing the complaint for
Gotesco Mall Commonwealth Ave. illegal dismissal for lack of merit. However, respondents are ordered to pay
Rustan’s Makati City complainant his 13th month pay, service incentive leave, and holiday pay
computed at:
Royal Duty Free Clark Air
Angeles City, Pampanga
Base,
Min. 13th Holida
Ram Sy Residence Ayala, Alabang Begi Mos
Start Wag Month SIL y TOTAL
n .
I-Bank Sucat, Parañaque e Pay Pay

Cuerpo Residence
9/29 12/3 198. 1,329.9
3.1
Bobby Cuerpo Residence /98 1/98 00 0

Olivares Residence
1/1/ 10/3 10.0 198. 4,318.6 1,980.
990.00
Bayot Residence Baguio City3 99 0/99 67 00 0 00
Mame received a daily wage of ₱440.00.
10/3 12/3 2.03 223.
984.64
1/99 1/99 33 50
In May 2001, respondents were contracted to construct the Bayot residence in
Baguio City. On September 18, 2001, respondent Norilyn Cuerpo called
Mame’s attention regarding the wrong installation of expensive narra planks 1/1/ 10/3 10.1 223. 4,907.0 1,117. 2,235.
on the stairs of the Bayot residence. The architect in charge of the project had 00 1/00 33 50 7 50 00
earlier complained of the wrong installation. Consequently, the couple had to
rectify the error and pay for the costs. 11/1 12/3 250. 1,083.3
2
/00 1/00 00 3
According to Mame, the couple told him "Umalis ka na, ayaw na kitang
makita dito. Tanggal ka na sa trabaho," followed by scathing insults. Thus, he 1/1/ 9/18 8.66 250. 4,694.4 1,500.
had no choice but to leave his employment. 01 /01 67 00 4 00

17,317. 2,107. 5,715. 25,140.4

For their part, the couple averred that Norilyn merely called petitioner’s 36
99 50 00 9
attention to the complaint of the architect and reprimanded him. He resented
the incident and opted to stay in the crew barracks. All other claims are dismissed for lack of merit.6

On September 28, 2001, petitioner filed a Complaint for Illegal Dismissal
against the spouses Cuerpo before the National Labor Relations Commission
(NLRC). He prayed that judgment be rendered in his favor, as follows:
WHEREFORE, premises considered, it is respectfully prayed that the
Honorable Office render a decision declaring the respondents to be liable for
illegal dismissal and ordering them to:
1. Immediately reinstate and give full backwages to the
complainant;
Aggrieved, Mame appealed the decision to the NLRC on the following
grounds:
I. THE HONORABLE ARBITER COMMITTED SERIOUS ERROR IN
COMPUTING COMPLAINANT-APPELLEE’S MONETARY AWARD ON
THE BASIS OF THE MINIMUM WAGE LAW, WHEN HIS LATEST
WAGE AS OF SEPT. 2001 IS ₱440.00 A DAY, MONEY-CLAIMS:
HOLIDAY PAY, HOLIDAY PREMIUM PAY, SERVICE INCENTIVE
LEAVE PAY;
II. THE HONORABLE ARBITER COMMITTED GRAVE ABUSE OF admission of private respondent that he walked out.
DISCRETION BY DECLARING THAT COMPLAINANT-APPELLANT
WAS NOT ILLEGALLY DISMISSED.7
2. The Honorable Public Respondent committed grave, patent and
palpable error in finding that there was illegal dismissal.
He averred that respondents failed to prove that he abandoned his job. He
insisted that walking out of respondent Norilyn Cuerpo after being
3. The Honorable Public Respondent committed grave abuse of
reprimanded does not constitute abandonment. His filing of the complaint for
discretion amounting to lack or excess of jurisdiction in awarding
illegal dismissal and respondents’ failure to serve him with the requisite two
money claims which private respondent himself did not pray for
notices are evidence that he did not abandon his job.
nor was he able to prove entitlement thereto.11

In reply, respondents countered that Mame abandoned his job because he no

Petitioner countered that since he filed his complaint shortly after he was
longer reported for work and remained in the workers’ barracks in Baguio
reprimanded by respondent Norilyn Cuerpo, his "walkout" did not constitute
City while his co-workers continued with the construction. They could not
abandonment.
have served him with the requisite two notices because they did not know that
he had decided not to report back to work. It was only when complainant filed
his complaint that respondents learned of his decision. On January 17, 2005, the CA rendered judgment granting the petition. The
appellate court set aside and reversed the decision of the NLRC on its finding
that petitioner was not dismissed from his employment, but that he abandoned
On August 26, 2003, the NLRC rendered judgment granting the appeal. 8 The
his job merely because he was reprimanded by respondents. According to the
NLRC set aside and reversed the decision of the Labor Arbiter. According to
CA:
the NLRC:

For having walked out, the private respondent provided a factual and legal
Appellees failed to establish any overt act from which we can infer the clear
basis for the petitioners to consider him as having abandoned his work and to
intention of appellant to desist from employment. Appellees admitted that
terminate his services for said reason. Despite the existence of said reason, the
after the walk-out and alleged abandonment of work on 18 September 2001,
petitioners did not. There exists no fact from which an opposite conclusion
appellant still stayed for several days at the construction crew barracks of the
can be inferred. There is simply no evidence that petitioners terminated him
Bayot residence project in Baguio City and refused to work for no reason
for having abandoned his work. It cannot even be characterized as
other than his attention being called because of the wrong installation of the
constructive dismissal. Despite the same, the public respondent reversed the
narra planks. Appellant was within easy reach of appellees. Yet, during this
finding of the Labor Arbiter reasoning out that "it is beyond logic to believe
period, appellees never took any step to compel appellant to return to work,
that a worker whose income and livelihood comes and depends upon his
did not question his alleged continued refusal to work and did not institute
employer’s good graces would defy them with such abandon."
any investigation or proceedings to cause his termination from work due to
abandonment. Appellees did not give appellant written notice of his
termination on the ground of abandonment. Failure to do so makes the Other than that reckoning, the public respondent had no other cogent
termination illegal. (Appellees’ Position Paper, p. 19). justification for its judgment of reversal. On record, it decided against the
petitioners for the reason that "Appellees (petitioners) did not give appellant
(private respondent) written notice of his termination on the ground of
It is true that appellees have every right to call appellant’s attention for any
abandonment." On that baseless premise, it concluded that "failure to do so
work that he has made poorly. It is also true that appellant should not have
makes the termination illegal." In so resolving, the public respondent stated:
walked-out on appellee Cuerpo. However, installing the narra planks
"Appellant was within easy reach of appellees. Yet, during this period,
erroneously and walking-out on appellee Cuerpo, while being reprimanded or
appellees never took any step to compel appellant to return to work, did not
told of his wrong installation, are insufficient to warrant appellant’s dismissal.
question his alleged continued refusal to work and did not institute any
Appellees agree that dismissal, under these circumstances, was unwarranted
investigation or proceedings to cause his termination from work due to
as they, in fact, admitted that they did not terminate appellant’s services.
abandonment."

Neither can the alleged dissension and unrest among respondents’ workers
We find it difficult to follow the logic of the public respondent. How can
caused by appellant justify his separation from employment. This allegation
failure to take any step to compel private respondent to return to work, failure
was uncorroborated with any evidence of statement from anyone of
to question his alleged continued refusal to work, and failure to institute any
appellant’s co-workers. Notwithstanding, even granting that appellant caused
investigation or proceedings to cause his termination from work due to
any such dissension and unrest, appellees did not observe due process in
abandonment, be considered as proof that petitioners had terminated him for
terminating his services. They never informed appellant of the reasons why he
abandonment? The rationalization of the public respondent, in the absence of
should be terminated and never gave him the opportunity to explain. He was
any overt act on the part of the petitioners, defies logic considering that it
simply dismissed from work.9
even acknowledged: "Appellees agree that dismissal, under these
circumstances, was unwarranted as they, in fact, admitted that they did not
The NLRC declared that petitioner did not seek reinstatement. The dispositive terminate appellant’s services."
portion of the decision reads:
It is erroneous on the part of the public respondent to fault petitioners for not
WHEREFORE, the appeal is hereby GRANTED and the Decision of the initiating any formal investigation. It is unfounded as it proceeds from a
Labor Arbiter dated 30 September 2002 is REVERSED and SET ASIDE. In presumption that petitioners terminated his services for abandonment. Why
lieu thereof, a new order is hereby issued declaring appellant to have been would they do so if they were not contemplating the termination of his
illegally dismissed from his employment by appellees. services for said reason? It must be remembered that he has been working for
them since January of 1988. For such a petty misunderstanding, the
petitioners had no reason to expect that private respondent would consider
Consequently, appellees are hereby directed to pay appellant, jointly and
himself as terminated and precipitately file a case. How can a few days of
severally, the amount of ₱475,995.66, representing his claims for unpaid 13th
non-communication be deemed a decision to terminate him? Obviously, his
month pay, SILP and holiday pay for the period of three (3) years, 19
rash filing of the complaint was premature. As the Labor Arbiter stated: "x x x
September 1998 to 18 September 2001, separation pay equivalent to fifteen
complainant’s complaint for dismissal cannot be sustained there being no
(15) month’s salary, and backwages, 13th month pay and SILP from the date
showing that the employee was prevented from returning to his work. It was
the same was withheld from appellant on 18 September 2001 up to the
he who walked out when his attention was called to the wrong installation of
promulgation of this Decision, and such additional backwages, 13th month
narra planks x x."
pay and SILP from this date and up to actual payment thereof.

SO DECIDED.10
Not satisfied, respondents filed a petition for certiorari with the CA against
petitioner on the following grounds:
1. With all due respect, the Honorable Public Respondent
committed grave abuse of discretion in reversing the factual
findings and conclusions of the Labor Arbiter and disregarding the
That the private respondent did walk out was viewed by the public respondent
as "beyond logic." It is hardly surprising, however. The petitioner had been
rendering his services for several employers in the business whenever these
were needed. Because of his skill, he had no difficulty earning a living. Thus,
it could be said that he had many clientele and could well-afford to leave the
petitioners. To take with him their money for no sweat at all, however, the
Court cannot countenance.12
The motion for reconsideration filed by petitioner was denied.
Thus, petitioner filed the instant petition, relying on the following ground:
x x x THE HON. COURT OF APPEALS COMMITTED REVERSIBLE
ERROR IN DETERMINING THAT PETITIONER ABANDONED HIS JOB
AND WAS NOT, THEREFORE, ILLEGALLY DISMISSED.13
IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The
Decision and Resolution of the Court of Appeals are REVERSED AND SET
ASIDE. The Decision of the NLRC is REINSTATED. No costs.
SO ORDERED.

Petitioner alleges that respondents failed to prove that he abandoned his job.
He avers that he was subjected to insults, the very reason why he walked out
of his job. Thus, his absence was work-related, due to respondent Norilyn’s
hostile treatment. Nonetheless, his mere absence or failure to report for work
does not amount to abandonment. He was not issued written notices to report
back to work, nor was he asked to explain why he was absent. Considering
that he had been working for respondents for 12 years, it was unlikely that he
would abandon his job. The fact that he was not given a written notice of
termination due to abandonment makes the termination illegal. To buttress his
arguments, petitioner cites the ruling of this Court in Tan v. National Labor
Relations Commission.14

For their part, respondents maintain that petitioner was not illegally dismissed
– he walked out and abandoned his job.

The petition is meritorious.1a\^/phi1.net

It must be stressed that in petitions for review under Rule 45, only questions
of law must be raised. Whether petitioner abandoned his job or was illegally
dismissed are questions of fact better left to quasi-judicial agencies to
determine. In this case, the Labor Arbiter was convinced that petitioner was
not dismissed; it was petitioner who left his job. The NLRC, while admitting
that petitioner "walked out," ruled that there was illegal dismissal because
respondents did not observe procedural due process. We are, therefore,
constrained to take a second look, particularly since the appellate court
reversed the findings of the NLRC.

We find that contrary to the rulings of the NLRC and the CA, petitioner
prayed for his immediate reinstatement with full back wages plus assorted
monetary benefits in his Position Paper.15 He made the same prayer in his
Memorandum on Appeal in the NLRC.16 However, petitioner declared therein
that the decision of the NLRC (which declared that he was entitled to
separation pay) was correct; and, in his petition in this Court, he prayed that
the decision of the NLRC be reinstated. In fine, petitioner is no longer praying
for reinstatement to his former employment with respondents.

We also reject the ruling of the CA that petitioner’s "walk-out" and his failure
to report to work afterwards is not sufficient to anchor a finding of
abandonment. It must be noted that petitioner must have been so humiliated
when respondent Norilyn blamed him for the erroneous installation of narra
planks on the stairs of the Bayot residence. He sulked and remained in the
crew barracks. He did not immediately leave the site. Thus, it cannot be
concluded solely by such circumstances that petitioner thereby abandoned his
job. Notwithstanding, respondents themselves did not consider petitioner as
having abandoned his job by his mere absence from September 18, 2001 to
September 28, 2001 when he left Baguio City and arrived in Manila to file his
complaint in the NLRC. The ten-day interval from the time of the incident
between petitioner and respondent Norilyn Cuerpo up to the time he filed the
complaint for illegal dismissal is so short that it is quite absurd to expect
respondents to consider that petitioner had abandoned his job. In fact,
respondents were not actually aware that petitioner quit his job.

In cases where abandonment is the cause for termination of employment, two

factors must concur: (1) there is a clear, deliberate and unjustified refusal to
resume employment; and (2) a clear intention to sever the employer-employee
relationship.17 The burden of proof that there was abandonment lies with the
employer. Where the employee takes steps to protest his layoff, it cannot be
said that he has abandoned his work because a charge of abandonment is
totally inconsistent with the immediate filing of a complaint for illegal
dismissal, more so when it includes a prayer for reinstatement.18

There is logic in the finding of the NLRC that it was quite improbable for
petitioner to have abandoned his job after having been employed with
respondents for twelve years. If, as the CA ruled, petitioner had decided to do
so, petitioner should have immediately left Baguio City to file his complaint;
however, he remained in the workers’ barracks until September 28, 2001.

Respondents failed to prove that petitioner had indeed tried to convince his
co-workers to abandon their jobs. They failed to submit any affidavit of any
of the co-workers of petitioner to prove this claim.
G.R. No. 177059               March 13, 2009
FE LA ROSA, OFELIA VELEZ, CELY DOMINGO, JONA
NATIVIDAD and EDGAR DE LEON, Petitioners, vs.
AMBASSADOR HOTEL, Respondent.
DECISION
CARPIO MORALES, J.:
On April 17, 2002, employees of Ambassador Hotel including herein
petitioners filed before the National Labor Relations Commission (NLRC)
several complaints, docketed as NLRC Case Nos. 04-02018-02, 30-04-02019-
02, 08-06442-02 and 02-03643-02, for illegal dismissal, illegal suspension,
and illegal deductions against the hotel (respondent) and its manager, Yolanda
L. Chan. They alleged that, following their filing of complaints with the
Department of Labor and Employment-NCR which prompted an inspection of
the hotel’s premises by a labor inspector, respondent was found to have been
violating labor standards laws and was thus ordered to pay them some money
claims. 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.
Criminal cases for estafa were likewise allegedly filed against several of the
employees involved, some of which cases were eventually dismissed by the
prosecutor’s office for lack of merit.
The complaints against respondent subject of the present petition were
consolidated. By Decision1 of September 30, 2003, the labor arbiter found
respondent and its manager Yolanda L. Chan guilty of illegal dismissal and
ordered them to pay petitioners’ separation pay at ½ month for every year of
service with full backwages, and 10% of the monetary award as attorney’s
fees.
paper submitted before the NLRC, petitioners only prayed for separation pay
and not for reinstatement, hence, following settled jurisprudence, the latter
relief has been foreclosed.
The appellate court went on to hold that respondent’s adoption of the work
reduction/rotation scheme, as well as its reassignment of petitioners, was a
valid exercise of management prerogative, absent any showing that the same
was done out of vengeance. It further held inapplicable the rule that the
institution of a complaint for illegal dismissal is inconsistent with
abandonment, because petitioners failed to pray for reinstatement as they
instead prayed for separation pay.
Petitioners’ motion for reconsideration having been denied by the appellate
court by Resolution6 dated March 7, 2007, they instituted the present petition
for review on certiorari.lawphil.net
Petitioners deny having abandoned their jobs. And they take exception to the
appellate court’s finding that they did not pray for reinstatement, they inviting
attention to paragraph 14, page 5 of their verified position paper reading: "x x
x Hence they are entitled to reinstatement with full backwages, or in the
alternative to full separation pay of one month per year of service," as well as
to their prayer in the pro-forma complaints filed before the labor arbiter
asking for the same relief.
Petitioners question as bereft of specific proof the appellate court’s ruling that
the work reduction/rotation scheme adopted by respondent was a valid
exercise of management prerogative.
Finally, petitioners question the issuance by the appellate court of a TRO, and
subsequently of a writ of preliminary injunction conditioned on respondent’s
posting of a bond which was lower than the judgment award, hence,
prejudicial to them.

Respondent appealed to the NLRC which, by Decision2 dated September 8, The petition is impressed with merit.
2005, affirmed the labor arbiter’s ruling with the modification that five of the
complainants, namely Diana P. Castillo, Lorena L. Hildao, Gilbert Ongjoco,
While it is settled that the Court is not a trier of facts and does not, as a rule,
Salvador So and Ma. Pilar A. Barcenilla, were directed to report back to
re-examine the evidence presented by the parties to a case, there are a number
work, and respondent was directed to accept them without having to pay them
of recognized exceptions, such as when the judgment is based on a
backwages. With respect to petitioners, the NLRC held that Edgar de Leon
misapprehension of facts; when the findings of facts of lower courts are
was "actually dismissed but illegally" on November 7, 2001 and that with
conflicting; or when the findings of facts are premised on the supposed
respect to the four other petitioners, they were constructively dismissed on
absence of evidence but which are contradicted by the evidence on record.7
April 15, 2002 by virtue of respondent’s memorandum of even date.

The appellate court predicated its reversal of the NLRC decision that
Thus, the NLRC disposed:
petitioners were illegally dismissed on petitioners’ supposed abandonment of
their jobs, and justified the work rotation/reduction scheme adopted by
WHEREFORE, premises considered, the Decision appealed from is hereby respondent as a valid exercise of management prerogative in light of
MODIFIED. Diana P. Castillo, Lorena I. Hildao, Gilbet Ongjoco, Salvador respondent’s business losses.
So and Ma. Pilar A. Barcenilla were not dismissed. They are ordered to report
back to work and respondents to accept them back, but without backwages.
The records fail, however, to show any documentary proof that the work
reduction scheme was adopted due to respondent’s business reverses.
[Herein petitioners] Fe La Rosa, Ofelia Velez, Cely Domingo and Jona Respondent’s memorandum8 dated April 5, 2000 (sic, should be 2002)
Natividad were constructively dismissed, and Edgar de Leon actually informing petitioners of the adoption of a two-day work scheme effective
dismissed but illegally. Accordingly, the awards made in their favor are April 5, 2002 made no mention why such scheme was being adopted. Neither
AFFIRMED. do the records show any documentary proof that respondent suffered financial
losses to justify its adoption of the said scheme to stabilize its operations.
SO ORDERED.3 (Underscoring supplied)
What is undisputed, as found by both the labor arbiter and the NLRC
4 and admitted by respondent itself, is that the complaints for violation of labor
On respondent’s motion for reconsideration, the NLRC, by Decision  dated
standards laws were filed by petitioners against respondent at the DOLE-
January 27, 2006, modified its decision by, among other things, absolving
NCR, some of which complaints were partially settled; and that almost
respondent’s manager Yolanda L. Chan of any personal liability.
immediately after the partial settlement of the said complaints, the work
reduction/rotation scheme was implemented.
Respondent appealed and prayed for the issuance of an injunctive writ before
the Court of Appeals, faulting the NLRC to have committed grave abuse of
Case law holds that constructive dismissal occurs when there is cessation of
discretion 1) in finding that petitioners were illegally dismissed, 2) in
work because continued employment is rendered impossible, unreasonable or
awarding backwages and separation pay, and 3) in requiring it to pay them the
unlikely; when there is a demotion in rank or diminution in pay or both; or
monetary equivalent of their service incentive leaves. Respondent maintained
when a clear discrimination, insensibility, or disdain by an employer becomes
that its act of reducing the number of work days per week was valid, as it was
unbearable to the employee.9 Respondent’s sudden, arbitrary and unfounded
done to save its business from bankruptcy due to economic reverses.
adoption of the two-day work scheme which greatly reduced petitioners’
salaries renders it liable for constructive dismissal.
The appellate court granted respondent’s prayer for a temporary restraining
order (TRO) and subsequently for a writ of preliminary injunction.
Respecting the appellate court’s ruling that petitioners "simply disappeared"
from their work, hence, they are guilty of abandonment, the same does not
By Decision5 dated December 12, 2006, the appellate court reversed the lie.1avvphi1
NLRC decision and dismissed petitioners’ complaints, holding that there was
no constructive dismissal because petitioners "simply disappeared from work"
Absence must be accompanied by overt acts unerringly pointing to the fact
upon learning of the work reduction/rotation scheme; and that in their position
that the employee simply does not want to work anymore. And the burden of
proof to show that there was unjustified refusal to go back to work rests
on the employer.

xxxx

Abandonment is a matter of intention and cannot lightly be inferred or legally

presumed from certain equivocal acts. For abandonment to exist, two
requisites must concur: first, the employee must have failed to report for work
or must have been absent without valid or justifiable reason; and second, 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. The
second element is the more determinative factor. Abandonment as a just
ground for dismissal thus requires clear, willful, deliberate, and unjustified
refusal of the employee to resume employment. Mere absence or failure to
report for work, even after notice to return, is not tantamount to
abandonment.10 (Emphasis and underscoring supplied)

Respondent, which has the onus of proving that petitioners abandoned their
work, failed to discharge the same, however.

Upon the other hand, petitioners’ immediate filing of complaints for illegal
suspension and illegal dismissal after the implementation of the questioned
work scheme, which scheme was adopted soon after petitioners’ complaints
against respondent for violation of labor standards laws were found
meritorious, negates respondent’s claim of abandonment. An employee who
takes steps to protest his dismissal cannot by logic be said to have abandoned
his work.11

As for the appellate court’s ruling that petitioners are not entitled to
reinstatement because they did not pray for it in their complaints, the same
does not lie. In all the pro-forma complaints12 filed by petitioners before the
NLRC, they prayed for reinstatement or, in the alternative, for the award to
them of separation pay. And they reiterated this prayer in their Position
Paper,13 specifically in paragraph 14 thereof, viz:

14. Due process was not followed in the constructive dismissal of the
complainants. Hence they are entitled to reinstatement with full
backwages or in the alternative to full separation pay  of one month per
year of service. (Emphasis and underscoring supplied)

Besides, under Article 27914 of the Labor Code and based on settled
jurisprudence, an employee dismissed without just cause and without due
process, like petitioners herein, are entitled to reinstatement and backwages or
payment of separation pay.

In fine, the Court finds that petitioner Edgar de Leon was illegally dismissed
on November 7, 2001, and the rest of the petitioners were illegally dismissed
on April 15, 2002 from which dates the payment of backwages (cum
separation pay), at the above-stated rate determined by the Labor Arbiter and
affirmed by the NLRC, are to be reckoned with. This leaves it unnecessary to
still pass on the issue of the propriety of the appellate court’s issuance of a
TRO and injunctive writ.

WHEREFORE, the petition is GRANTED.

The Court of Appeals Decision dated December 12, 2006 and Resolution
dated March 7, 2007 are REVERSED and SET ASIDE. The National Labor
Relations Commission Decision dated September 8, 2005 and Resolution
dated January 21, 2006 are REINSTATED.

SO ORDERED.
G.R. No. 179001               August 28, 2013 terminated.

MZR INDUSTRIES, MARILOU R. QUIROZ AND LEA Colambot, meanwhile, argued that contrary to petitioners’ claim that he
TIMBAL, PETITIONERS, vs. abandoned his job, he claimed that he did not report back to work after the
MAJEN COLAMBOT, RESPONDENT. expiration of his suspension on December 6, 2004, because Quiroz told him
that his employment was already terminated effective December 7, 2004.
DECISION
On April 28, 2006, the Labor Arbiter rendered a Decision, 15 the dispositive
portion of which reads:
PERALTA, J.:

WHEREFORE, premises considered, respondents are hereby declared guilty

This is a Petition for Review on Certiorari under Rule 45 of the Rules of
of ILLEGAL DISMISSAL and hereby ORDERED to reinstate complainant to
Court seeking the reversal of the Decision1 dated May 17, 2007 and
his former position with full backwages from date of dismissal until actual
Resolution2 dated July 25, 2007 of the Court of Appeals in CA-G.R. SP No.
reinstatement and moral and exemplary damages in the sum of ₱100,000.00
98445, reversing the Decision dated October 31, 20063 and Resolution4 dated
and ₱50,000.00, respectively.
December 21, 2006 of the National Labor Relations Commission (NLRC)
which set aside the Decision5 dated April 28, 2006 of the Labor Arbiter.
The computation of the judgment award marked as Annex "A" is part and
parcel of this decision.
The facts are as follows:

SO ORDERED.16
On February 8, 2000, petitioner Marilou Quiroz, Owner and Vice-President
for Finance and Marketing of MZR, hired respondent Majen Colambot
(Colambot) as messenger. Colambot's duties and responsibilities included The Labor Arbiter held that there was no abandonment as there was no
field, messengerial and other liaison work. deliberate intent on the part of Colambot to sever the employer-employee
relationship. The Labor Arbiter likewise noted that Colambot should have
been notified to return back to work, which petitioner failed to do.
However, beginning 2002, Colambot's work performance started to
deteriorate. Petitioners issued several memoranda to Colambot for habitual
tardiness, negligence, and violations of office policies.6 He was also given Aggrieved, petitioners appealed the decision before the NLRC.
written warnings for insubordination committed on August 27, 2003 and
September 11-12, 2003;7 on September 16, 2003 for negligence caused by
On October 31, 2006, the NLRC rendered a Decision,17 the dispositive portion
careless handling of confidential office documents;8 on September 22, 2004
of which reads as follows:
for leaving his post without proper turnover; 9 and, on October 4, 2004 for
insubordination.10
WHEREFORE, premises considered, the appeal filed by respondents is
GRANTED. The judgment of the Labor Arbiter dated April 28, 2006 is
Petitioners claimed that despite written warnings for repeated tardiness and
hereby SET ASIDE and the Complaint is DISMISSED for lack of merit.
insubordination, Colambot failed to mend his ways. Hence, in a
Memorandum11 dated October 25, 2004 issued by petitioner Lea Timbal
(Timbal), MZR's Administrative Manager, Colambot was given a notice of SO ORDERED.18
suspension for insubordination and negligence.
The NLRC pointed out that Colambot's complaint was unsupported by any
Again, in a Memorandum12 dated November 25, 2004, Colambot was evidence and was not even made under oath, thus, lacking in credibility and
suspended from November 26, 2004 until December 6, 2004 for probative value. The NLRC further believed that Colambot abandoned his
insubordination. Allegedly, Colambot disobeyed and left the office despite work due to his refusal to report for work after his suspension. The failure of
clear instructions to stay in the office because there was an important meeting MZR to notify Colambot to return back to work is not tantamount to actual
in preparation for a very important activity the following day. dismissal.

Petitioners claimed they waited for Colambot to report back for work on
December 7, 2004, but they never heard from him anymore. Later, petitioners
were surprised to find out that Colambot had filed a complaint for illegal
suspension, underpayment of salaries, overtime pay, holiday pay, rest day,
service incentive leave and 13th month pay. On December 16, 2004, the
complaint was amended to illegal dismissal, illegal suspension, underpayment
of salaries, holiday pay, service incentive pay, 13th month pay and separation
pay.13
For his part, Colambot narrated that he worked as a messenger for petitioners
since February 2000. That on November 2004, he was directed to take care of
the processing of a document in Roxas Boulevard, Pasay City. When he
arrived at the office around 6 to 7 o'clock in the evening, he looked for
petitioner Quiroz to give the documents. The latter told him to wait for her for
a while. When respondent finally had the chance to talk to Quiroz, she
allegedly told him that she is dissatisfied already with his work performance.
Afterwards, Colambot claimed that he was made to choose between resigning
from the company or the company will be the one to terminate his services.
He said he refused to resign. Colambot alleged that Quiroz made him sign a
memorandum for his suspension, from November 26 to December 6, 2004.
After affixing his signature, Quiroz told him that effective December 7, 2004,
he is already deemed terminated. Later, on December 2, 2004, respondent
went back to the company to look for Timbal to get his salary. He claimed
that Timbal asked him to turn over his company I.D.14
Colambot filed a motion for reconsideration, but was denied. Thus, via a
petition for certiorari under Rule 65 of the Rules of Court, raising grave abuse
of discretion as a ground, Colambot appealed before the Court of Appeals and
sought that the Decision dated October 31, 2006 and Resolution dated
December 21, 2006 of the NLRC be reversed and set aside.
In the disputed Decision19 dated May 17, 2007, the Court of Appeals granted
the petition and reversed the assailed Decision dated October 31, 2006 and
Resolution dated December 21, 2006 of the NLRC. The Decision dated April
28, 2006 of the Labor Arbiter was ordered reinstated with modification that in
lieu of reinstatement, petitioners were ordered to pay respondent separation
pay equivalent to one (1) month pay for every year of service in addition to
full backwages.
The appellate court ruled that Colambot was illegally dismissed based on the
grounds that: (1) MZR failed to prove abandonment on the part of Colambot,
and (2) MZR failed to serve Colambot with the required written notices of
dismissal.2007.
Petitioners appealed, but was denied in a Resolution20 dated July 25, 2007.
Thus, via Rule 45 of the Rules of Court, before this Court, petitioners raised
the following issues:

Petitioners, however, insisted that while Colambot was suspended due to

insubordination and negligence, they maintained that they never terminated I
Colambot's employment. They added that Colambot's failure to report for
work since December 7, 2004 without any approved vacation or sick leave THE HONORABLE COURT OF APPEALS ERRED IN RULING THAT
constituted abandonment of his work, but they never terminated his COMPLAINANT WAS ILLEGALLY DISMISSED FROM THE SERVICE.
employment. Petitioners further emphasized that even with Colambot's filing
of the complaint against them, his employment with MZR has not been
II
THE HONORABLE COURT SERIOUSLY ERRED IN RULING THAT
PETITIONER IS ENTITLED TO SEPARATION PAY AND
BACKWAGES.
Petitioners argue that they did not terminate the employer-employee
relationship with Colambot. Other than Colambot's self-serving and
unverified narration of facts, he failed to present any document showing that
he was terminated from work. Petitioners assert that Colambot abandoned his
work when he failed to report back to work without an approved vacation or
sick leave, thus, he is not entitled to an award of separation pay and
backwages.
RULING
While we recognize the rule that in illegal dismissal cases, the employer bears
the burden of proving that the termination was for a valid or authorized cause,
in the present case, however, the facts and the evidence do not establish a
prima facie case that the employee was dismissed from employment. Before
the employer must bear the burden of proving that the dismissal was legal, the
employee must first establish by substantial evidence the fact of his dismissal
from service. If there is no dismissal, then there can be no question as to the
legality or illegality thereof.21
In the present case, other than Colambot's unsubstantiated allegation of
having been verbally terminated from his work, there was no evidence
presented to show that he was indeed dismissed from work or was prevented
from returning to his work. In the absence of any showing of an overt or
positive act proving that petitioners had dismissed respondent, the latter's
claim of illegal dismissal cannot be sustained22 – as the same would be self-
serving, conjectural and of no probative value.
A review of the Notice of Suspension 23 dated November 25, 2004 shows that
respondent was merely suspended from work for 6 days, there was, however,
no evidence that Colambot was terminated from work. For clarification, we
quote:
TO : MAJEN COLAMBOT
MZR MESSENGER
FROM : HUMAN RESOURCE DEPT
DATE : NOV. 25, 2004
RE : SUSPENSION DUE TO INSUBORDINATION
xxxx
Cases of insubordination and violations have been filed against you many
times. We kept on reminding that you should have changed and improved
your working attitudes because it greatly affects not only your working
performance but the company's productivity as well.
Your attitude only shows HARD HEADEDNESS AND LACK OF
RESPECT TO YOUR SUPERIORS which in any company cannot tolerate.
With these, you are suspended for 6 working days effective November 26,
2004, you will only report on December 7, 2004.
THIS IS OUR LAST WARNING FOR YOU TO IMPROVE, FAILURE TO
DO SO MAY MEAN TERMINATION OF YOUR EMPLOYMENT
CONTRACT.
x x x x24
While the same appeared to contain a warning of termination should
Colambot fail to improve his behavior, it is likewise apparent that there was
also a specific instruction for him to report back to work, on December 7,
2004, upon serving his suspension. The subject of the Letter, i.e., "Suspension
due to Insubordination," the wordings and content of the letter is a clear-cut
notice of suspension, and not a notice of termination. The notice of
suspension may have contained warnings of termination, but it must be noted
that such was conditioned on the ground that – Colambot would fail to
improve his attitude/behavior. There were no wordings whatsoever implying
actual or constructive dismissal. Thus, Colambot's general allegation of
having been orally dismissed from the service as against the clear wordings
and intent of the notice of suspension which he signed, we are then inclined to
believe that there was no dismissal.
In Machica v. Roosevelt Services Center, Inc.,25 this Court sustained the
employer's denial as against the employees' categorical assertion of illegal
dismissal. In so ruling, this Court held that:
The rule is that one who alleges a fact has the burden of proving it; thus,
petitioners were burdened to prove their allegation that respondents dismissed
them from their employment. It must be stressed that the evidence to prove
this fact must be clear, positive and convincing. The rule that the employer
bears the burden of proof in illegal dismissal cases finds no application here
because the respondents deny having dismissed the petitioners.26
Hence, as between respondents’ general allegation of having been orally
dismissed from the service vis-a-vis those of petitioners which were found to
be substantiated by the sworn statement of foreman Wenifredo, we are
persuaded by the latter. Absent any showing of an overt or positive act
proving that petitioners had dismissed respondents, the latter’s claim of illegal
dismissal cannot be sustained. Indeed, a cursory examination of the records
reveal no illegal dismissal to speak of.27
Moreover, in Abad v. Roselle Cinema,28 we ruled that the substantial evidence
proffered by the employer that it had not terminated the employee should not
be ignored on the pretext that the employee would not have filed the
complaint for illegal dismissal if he had not really been dismissed. We held
that such non sequitur reasoning cannot take the place of the evidence of both
the employer and the employee.
Neither could the petitioners be blamed for failing to order respondent to
return back to work.  Records show that Colambot immediately filed the
complaint for illegal dismissal on December 16, 2004,29 or just a few days
when he was supposed to report back to work on December 7, 2004. For
petitioners to order respondent to report back to work, after the latter had
already filed a case for illegal dismissal, would be unsound.
However, while the Court concurs with the conclusion of the NLRC that there
was no illegal dismissal, no dismissal having actually taken place, the Court
does not agree with its findings that Colambot committed abandonment of
work.
In a number of cases,30 this Court consistently held that to constitute
abandonment of work, two elements must be present: first, the employee must
have failed to report for work or must have been absent without valid or
justifiable reason; and second, there must have been a clear intention on the
part of the employee to sever the employer-employee relationship manifested
by some overt act.
In the instant case, other than Colambot's failure to report back to work after
suspension, petitioners failed to present any evidence which tend to show his
intent to abandon his work. It is a settled rule that mere absence or failure to
report for work is not enough to amount to abandonment of work. There must
be a concurrence of the intention to abandon and some overt acts from which
an employee may be deduced as having no more intention to work. 31 On this
point, the CA was correct when it held that:
Mere absence or failure to report for work, even after notice to return, is not
tantamount to abandonment. The burden of proof to show that there was
unjustified refusal to go back to work rests on the employer. Abandonment is
a matter of intention and cannot lightly be presumed from certain equivocal
acts. To constitute abandonment, there must be clear proof of deliberate and
unjustified intent to sever the employer-employee relationship. Clearly, the
operative act is still the employee’s ultimate act of putting an end to his
employment. Furthermore, it is a settled doctrine that the filing of a complaint
for illegal dismissal is inconsistent with abandonment of employment. An
employee who takes steps to protest his dismissal cannot logically be said to
have abandoned his work. the filing of such complaint is proof enough of his
desire to return to work, thus negating any suggestion of abandonment.32
Suffice it to say that, 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. It is therefore incumbent upon petitioners
to ascertain the respondents’ interest or non-interest in the continuance of
their employment. This, petitioners failed to do so.
These circumstances, taken together, the lack of evidence of dismissal and the
lack of intent on the part of the respondent to abandon his work, the remedy is
reinstatement but without backwages.33 However, considering that
reinstatement is no longer applicable due to the strained relationship between
the parties and that Colambot already found another employment, each party
must bear his or her own loss, thus, placing them on equal footing.

Verily, in a case where the employee's failure to work was occasioned neither
by his abandonment nor by a termination, the burden of economic loss is not
rightfully shifted to the employer; each party must bear his own loss.34

WHEREFORE, premises considered and subject to the above disquisitions,

the Decision dated May 1 7, 2007 of the Court of Appeals is hereby
REVERSED and SET ASIDE. The Resolution dated October 31, 2006 of the
National Labor Relations Commission in NLRC NCR CASE No. 00-11-
12189-04/ CA No. 049533-06 is hereby REINSTATED.

SO ORDERED.
G.R. No. 175369               February 27, 2013
TEGIMENTA CHEMICAL PHILS. and VIVIAN ROSE D.
GARCIA, Petitioners, vs.
MARY ANNE OCO, Respondent.
DECISION
SERENO, J.:
Before this Court is a Rule 45 Petition, seeking a review of the 24 April 2006
Court of Appeals (CA) Resolution in CA-G.R. SP No. 87706.1 The CA
reversed its 3 January 2006 Decision and, in effect, affirmed the 30 July 2 and
24 September 20043 Resolutions of the National Labor Relations Commission
(NLRC) in NLRC CA No. 036684-03 and the 30 May 2003 Decision4 in
NLRC NCR -Case No. 06-03760-2002 of the labor arbiter (LA). The courts a
quo similarly found that petitioner had illegally dismissed respondent Mary
Anne Oco (Oco ).
The antecedent facts are as follows:5
Starting 5 September 2001, respondent worked as a clerk, and later on as a
material controller, for petitioner Tegimenta Chemical Philippines,
Incorporated (Tegimenta), a company owned by petitioner Vivian Rose D.
Garcia (Garcia).
By reason of her pregnancy, Oco incurred numerous instances of absence and
tardiness from March to April 2002. Garcia subsequently advised her to take a
vacation, which the latter did from 1 to 15 May 2002.
On her return, Oco immediately worked for the next four working days of
May. However, on 21 May 2002, Garcia allegedly told her to no longer report
to the office effective that day. Hence, respondent no longer went to work.
She nevertheless called petitioner at the end of the month, but was informed
that she had no more job to do.
Immediately thereafter, on 3 June 2002, respondent filed a Complaint for
illegal dismissal and prayed for reinstatement and back wages before the LA.
Later on, she amended her Complaint by asking for separation pay instead of
reinstatement.
In her Position Paper,6 Oco maintained that petitioner verbally dismissed her
without any valid cause and without due process. To bolster her story,
respondent adduced that Tegimenta hired new employees to replace her. In
their defense, petitioners countered that she had abandoned her job by being
continuously absent without official leave (AWOL). They further narrated
that they could not possibly terminate her services, because she still had to
settle her accountabilities.7
The LA disbelieved the narration of petitioners and thus ruled in favor of
respondent. The arbiter deduced that the employer only wanted to "make it
appear that the complainant was not dismissed from employment, as she
could not prove it with any Memorandum issued to that effect and yet, they
also maintain that complainant was AWOL."8 The LA further observed that
petitioners did not deny the main claim of respondent that she had simply
been told not to report for work anymore.
Aggrieved, petitioners appealed to the NLRC. They assailed the ruling of the
LA for having been issued based not on solid proof, but on mere allegations
of the employee.9 They advanced further that Oco had abandoned her
employment, given that she claimed separation pay instead of reinstatement.
The NLRC reviewed the records of the case and found that the documentary
evidence coincided with the allegations of Oco.10
Consequently, it affirmed her claim that Garcia, without advancing any
reason and without giving any written notice, had categorically told her not to
work for Tegimenta anymore. Accordingly, the NLRC sustained the illegality
of respondent’s dismissal.11
On Motion for Reconsideration, the NLRC still affirmed the LA’s
Decision in toto.12 Thus, petitioners pursued their action before the CA via a
Rule 65 Petition.
Alleging grave abuse of discretion amounting to lack or excess of jurisdiction,
petitioners again assailed the factual determinations of the LA and the NLRC.
In doing so, they attacked Oco’s allegations for being inconsistent with the
evidence on record.
Petitioners reiterated the following before the CA: (1) the payroll sheets from
May to August 2002 belied the claim of Oco that Tegimenta had hired new
employees to replace her; (2) the time cards showing respondent’s attendance
in the office on 21 May 2002 negated the story that Garcia had verbally
instructed her not to report for work starting from the said date; and (3) the
Complaint that Oco filed before the LA, stating that she was fired on 3 June
2002, contradicted her allegation in her Position Paper that she was ultimately
terminated on 30 May 2002 – a discrepancy of three days.13 The employer
also highlighted the marginal notation on the 16 to 30 June 2002 payroll
sheet, which indicated that the company considered respondent "on leave."
Appreciating these inconsistencies, together with the marginal notes in the
payroll sheet, the CA overturned the courts a quo and pronounced that no
actual dismissal transpired; rather, Oco was merely on AWOL.
Subsequently, respondent sought reconsideration. She insisted that petitioners
actually terminated her services, and that they failed to discharge their burden
to prove that it was she who had abandoned work by being on AWOL.
This time around, the CA reversed its earlier ruling.14 Albeit belatedly, the CA
realized that (1) the alleged hiring of new employees, (2) the presence of Oco
in the office on the day of her termination, and (3) the three-day discrepancy
between the date of her dismissal, stated in her Complaint before the LA and
that in her Position Paper were all immaterial to the threshold question of
whether she abandoned her work or was illegally dismissed.
Proceeding therefore with the main issue, the CA debunked petitioners’
insistence that Oco abandoned her employment by being on AWOL. Firstly, it
noted that she reported for work right after her vacation, an act that indicated
her intention to resume her employment. In this light, petitioners failed to
prove that she had intended to abandon her work. The appellate court held:15
A deeper study of the records show that Tegimenta failed to adduce proof of
any overt act of Oco that clearly and unequivocably showed her intention
to abandoned her work when she allegedly absented herself without leave.
The absences incurred by Oco do not indicate that she already abandoned her
work, especially considering that Oco reported for work after the agreed
dates of her vacation leave, and she subsequently filed an illegal dismissal
case against Tegimenta. (Emphasis supplied).
Secondly, the CA rejected the payroll sheets as proof that Oco was on
AWOL. It held that the company’s marginal notes reflecting that she was "on
leave" had no supporting attachments. It even construed the notations as
incompetent evidence because, despite her absence, the payroll sheets for July
2002 onwards had no notations at all that she was "on leave."16
Thirdly, the CA dismissed petitioners’ argument that Oco had effectively
abandoned her work and waived her claim for back wages when she changed
her prayer from reinstatement to separation pay. The appellate court simply
explained that opting for separation pay, in lieu of reinstatement, could not
support the allegation that Oco abandoned her work; and that the relief for
separation pay did not preclude the grant of back ages, as these two awards
were twin remedies available to an illegally dismissed employee.
Completely dissatisfied with the reversal of their fortune, petitioners implore
this Court (1) to discredit the allegation of Oco that she had in fact been
dismissed by them and (2) to make a finding that she abandoned her work by
being on AWOL.
RULING OF THE COURT
The Factual Determination of the Employee’s Dismissal
Prefatorily, the inquiry into whether Garcia verbally fired Oco and whether
the employee abandoned her job are factual determinations generally beyond
the jurisdiction of this Court;17 and in addition to the weakness of petitioners’
case, all the courts below consistently affirmed the certainty of the
employee’s dismissal by the employer.18
An established doctrine in labor cases is that factual questions are for labor
tribunals to resolve. Their consistent findings are binding and conclusive and
will normally not be disturbed, since this Court is not a trier of
facts.19 Therefore, on the basis of these circumstances alone, the appeal before
us already deserves scant consideration.
Nevertheless, petitioners adamantly try to persuade this Court to believe their
narration that they did not dismiss Oco. To prove their version of the story,
they poke holes in her narration by harping on her allegedly false claim that
Tegimenta hired replacements and by faulting her for rendering work on the
very day that her services were supposedly terminated. Unfortunately, these
purported defects in her narration cannot carry the day for petitioners.
According to the CA, the hiring of new employees and the presence of Oco
on the day of her termination were all immaterial to resolving the issue of
whether she was on AWOL or was illegally dismissed. We find this
appreciation to be correct. Courts consider the evidence as material if it refers
to the be-all and end-all of a petitioner’s cause. 20 Here, none of the loopholes
can resolve the case, since it is expected that dismissals may occur even if no
prior replacements were hired, and an employer can indeed attempt to
terminate employees on any day that they come in for work.
Petitioners also make a big fuss about the differing termination dates that Oco
stated in her Complaint (3 June 2002) and her Position Paper (30 May 2002).
But in Prieto v. NLRC,21 we held that employees who are not assisted by
lawyers when they file a complaint with the LA may commit a slight error
that is forgivable if rectified later on.
Here, Oco only had one inadvertence when she filled out the Complaint in
template form. She also stated in all her subsequent pleadings before the LA,
the NLRC, the CA and this Court that she was dismissed on 30 May 2002. On
this point, we similarly rule by regarding the inaccuracy as an error that is
insufficient to destroy her case.
Most notably, the LA observed that the employers "did not deny the claims of
complainant [Oco] that she was simply told not to work."22 As in Solas v.
Power & Telephone Supply Phils. Inc.,23 this silence constitutes an admission
that fortifies the truth of the employee’s narration. Section 32, Rule 130 of the
Rules Court, provides:
An act or declaration made in the presence and within the hearing or
observation of a party who does or says nothing when the act or declaration is
such as naturally to call for action or comment if not true, and when proper
and possible for him to do so, may be given in evidence against him.
Considering this rule of evidence, together with the immaterial discrepancies,
this Court thus rules against wholly invalidating the findings of the courts a
quo.
The Employer’s Defense of Absence without Official Leave
After unsuccessfully assailing the narration of the employee, petitioners argue
that Oco abandoned her job by being on AWOL. As bases for this affirmative
defense, they highlight her previous instances of absence and tardiness. Then,
they emphasize the marginal notes in the 16 to 30 Jun 2002 payroll, which
showed that she was on leave. Finally, they equate the employee’s act of
asking for separation pay instead of reinstatement as an act of abandonment.
The bases cited by petitioners are bereft of merit.
First, the nonappearance of Oco at work was already accepted by the
company as having resulted from complications in her pregnancy. In fact,
Garcia herself offered respondent a vacation leave. Therefore, given that the
absences of the latter were grounded on justifiable reasons, these absences
cannot serve as the antecedent to the conclusion that she had already
abandoned her job. 24
For abandonment to exist, two factors must be present: (1) the failure to
report for work or absence without a valid or justifiable reason; and (2) a clear
intention to sever the employer-employee relationship, with the second
element as the more determinative factor being manifested by some overt
acts.25
The mere absence of an employee is not sufficient to constitute
abandonment.26 As an employer, Tegimenta has the burden of proof to show
the deliberate and unjustified refusal of the employee to resume the latter’s
employment without any intention of returning.27
Here, Tegimenta failed to discharge its burden of proving that Oco desired to
leave her job. The courts a quo  uniformly found that she had continuously
reported for work right after her vacation, and that her office attendance was
simply cut off when she was categorically told not to report anymore. These
courts even noted that she had also called up the office to follow up her status;
and when informed of her definite termination, she lost no time in filing a
case for illegal dismissal. Evidently, her actions did not constitute
abandonment and instead implied her continued interest to stay employed.
Second, the marginal notes in the 16 to 30 June 2002 payroll showing that she
was on leave are dubious. For one, the CA dutifully detected that none of the
succeeding payroll sheets indicated that Oco was considered by the company
as merely AWOL. Hence, it becomes questionable whether there is regularity
in making simple notations as Tegimenta’s reference in considering the status
of an employee. Therefore, we hold that the marginal notations in a single
payroll sheet are not competent proofs to back up petitioner’s main defense.
This Court also rejects the invocation by petitioners of the bestevidence rule.
According to them, the payroll sheet, and not the mere allegation of Oco, is
the best evidence that they did not terminate her.
However, petitioners seem to miss the whole import of the bestevidence rule.
This rule is used to compel the production of the original document, if the
subject of the inquiry is the content of the document itself. 28 The rule provides
that the court shall not receive any evidence that is merely substitutionary in
nature, such as a photocopy, as long as the original evidence of that document
can be had.29
Based on the explanation above, the best-evidence rule has no application to
this case. The subject of the inquiry is not the payroll sheet of Tegimenta
rather, the thrust of this case is the abundance of evidence present to prove the
allegation that Oco abandoned her job by being on AWOL. Consequently, the
employer cannot be logically stumped by a payroll sheet, but must be able to
submit testimonial and other pieces of documentary evidence – like leave
forms, office memos, warning letters and notices – to be able to prove that the
employee abandoned her work.
Finally, petitioners posit that Oco’s act of replacing the prayer for
reinstatement with that for separation pay implied that respondent abandoned
her employment.
Abandonment is a matter of intention and cannot lightly be inferred or legally
presumed from certain equivocal acts.30 For abandonment to be appreciated,
there must be a "clear, willful, deliberate, and unjustified refusal of the
employee to resume employment."31 Here, the mere fact that Oco asked for
separation pay, after she was told to no longer report for work, does not
reflect her intention to leave her job. She is merely exercising her option
under Article 279 of the Labor Code, which entitles her to either
reinstatement and back wages or payment of separation pay.
As an end note, petitioners advance a procedural lapse on the part of the CA.
They argue that since no new facts, evidence or circumstances were
introduced by respondent to the appellate court, it cannot issue a Resolution
that reverses its earlier Decision.
In Astraquillo v. Javier,32 we have similarly dealt with this contention and
considered it as flawed. Our procedural laws allow motions for
reconsideration and their concomitant resolutions, which give the same court
an opportunity to reconsider and review its own ruling.
As stated in Section 5(g) of Rule 135, every court shall have the inherent
power to amend and control its processes and orders, so as to make them
conformable to law and justice. "This power includes the right to reverse
itself, especially when in its honest opinion it has committed an error or
mistake in judgment, and that to adhere to its decision will cause injustice to a
party-litigant."33 Thus, upon finding that petitioners had indeed illegally
dismissed respondent, the CA merely exercised its prerogative to reverse an
incorrect judgment.
IN VIEW THEREOF, the 24 April 2006 Resolution of the Court of Appeals
in CA-G.R. CV No. 87706 is AFFIRMED. The 12 May 2006 Petition for
Review on Certiorari filed by Tegimenta Chemical Philippines, Incorporated
and Vivian Rose D. Garcia is hereby DENIED for lack of merit.
SO ORDERED.
G.R. No. 190436               January 16, 2012
NORMAN YABUT, Petitioner, vs.
MANILA ELECTRIC COMPANY and MANUEL M.
LOPEZ, Respondents.
DECISION
REYES, J.:
Before us is a petition for review on certiorari under Rule 45 of the Rules of
Civil Procedure which assails the Decision1 dated August 10, 2009 and
Resolution2 dated November 26, 2009 of the Court of Appeals (CA) in the
case docketed as CA-G.R. SP No. 96789, entitled "Manila Electric Company
(Meralco) and Manuel M. Lopez v. Norman Yabut and National Labor
Relations Commission."
The Facts
This case stems from a complaint for illegal dismissal and monetary claims
filed by herein petitioner Norman Yabut (Yabut) against respondents Manila
Electric Company (Meralco) and Meralco officer Manuel M. Lopez (Lopez).
The petitioner had worked with Meralco from February 1989 until his
dismissal from employment on February 5, 2004. At the time of said
dismissal, he was assigned at the Meralco Malabon Branch Office as a Branch
Field Representative tasked, among other things, to conduct surveys on
service applications, test electric meters, investigate consumer-applicants'
records of Violations of Contract (VOC) and perform such other duties and
functions as may be required by his superior.
The circumstances antecedent to his dismissal are as follows:
On October 4, 2003, Meralco's Inspection Office issued a
memorandum3 addressed to Meralco's Investigation-Legal Office, informing it
of an illegal service connection at the petitioner's residence, particularly at
No. 17 Earth Street, Meralco Village 8, Batia, Bocaue, Bulacan. The
Inspection Office claimed discovering shunting wires installed on the meter
base for Service Identification Number (SIN) 708668501, registered under
petitioner Yabut's name. These wires allegedly allowed power transmission to
the petitioner's residence despite the fact that Meralco had earlier
disconnected his electrical service due to his failure to pay his electric bills.
Given this report, Meralco's Head of Investigation-Litigation Office issued to
the petitioner a notice4 dated November 3, 2003, received by the petitioner's
wife on the same day and with pertinent portions that read:
Please report to our Mr. Rodolfo C. Serra of the Investigation-Litigation at
8th Floor, Lopez Building, Meralco Center, Ortigas Avenue, Pasig City
on November 11, 2003, at 9:00 a.m. as the Inspection had found your
disconnected electric service with SIN No. 708668501 directly connected by
a shunting wire to energize your empty meter base. If proven true, such act
constitutes dishonesty in violation of Section 7 (3) of the Company Code on
Employee Discipline and/or serious misconduct or an act analogous to fraud
or commission of a crime under Article 282 (a) and (e) of the Labor Code of
the Philippines.
In this investigation, you are entitled to be assisted by a counsel or an
authorized union representative. You are also allowed to present evidence and
material witnesses to testify in your favor.
Should you fail to appear on the aforementioned date, we shall take it to mean
that you are waiving your right to present your side and refute the aforesaid
charge and evidence against you. If you appear alone, we shall take it to mean
that you are waiving your right to be represented by such counsel or union
representative.5
The offense under Section 7 (3) of Meralco's Company Code on Employee
Discipline referred to in the aforequoted notice is with penalty of dismissal on
the first offense and is defined as follows:
SECTION 7. Dishonesty.
The following acts shall constitute violation of this Section:
xxxx
3) Directly or indirectly tampering with electric meters or metering
installations of the Company or the installation of any device, with the
purpose of defrauding the Company.
x x x x6
In the course of the company's investigations, the petitioner presented his
sworn statement7 which was executed with the assistance of Jose Tullo, the
Chief Steward and Vice President of Meralco's supervisory union First Line
Association of Meralco Supervisory Employees (FLAMES). Yabut admitted
being the registered customer of Meralco at No. 17 Earth Street, Meralco
Village 8, Batia, Bocaue, Bulacan. The petitioner claimed that his electrical
service was disconnected sometime in July 2003 for unpaid electric bills. On
October 3, 2003, between 10:00 o'clock and 10:30 o'clock in the morning, he
was informed by his wife that Meralco discovered shunting wires on their
meter base during an inspection. The petitioner nonetheless claimed that at
about 8:00 o'clock in the morning of the same day, prior to his wife's notice
upon him of the inspection, he had already given to an officemate the amount
of ₱8,432.35 and requested that the same be paid to Meralco to cover his
outstanding electric bills. The amount of ₱8,432.35 plus ₱1,540 as service
deposit was then paid for the petitioner's account on October 3, 2003 at about
9:30 o'clock in the morning.
Yabut denied knowing the person who installed the discovered shunting
wires. While he did not always go home to their house in Bulacan as there
were times when he stayed in his sister's residence in Malabon, the petitioner
confirmed that he was regularly in his Bulacan house. His residence had
electricity even prior to the full settlement of his outstanding bills through a
connection made to the line of his neighbor Jojo Clemente.
Photographs taken during Meralco's inspection of Yabut's residence were also
presented to and identified by Yabut. He confirmed that the inspected meter
base was installed within his lot's premises. Claiming that he had been
obtaining electricity from a neighbor, he argued that shunting wires in his
meter base could have caused an electrical malfunction. As to Meralco's
allegation that Yabut's wife had admitted the petitioner's authorship of the
illegal connection, Yabut denied knowing of such admission.
Meralco’s Litigation – Investigation Office summarized the results of
Meralco's findings in a memorandum8 dated December 30, 2003. It indicated
that Yabut’s electric service was disconnected on April 3, 2003 for account
delinquency. Notwithstanding the disconnection and the fact that Meralco’s
service had not been reconnected, Yabut's meter registered electric
consumption. The memorandum included the following findings:
While Yabut denied responsibility about the illegal connection, the pictures
taken specifically showing the shunted wires on the meter base and his wife's
admission that he was the one responsible are sufficient proofs of his guilt.
We give credit to the admission of his wife as she did it with spontaneity
without force or intimidation in our part. His alibi that he seldom stayed in his
house is controverted by his admission that within the period in question from
July to October 3, 2003, he stayed home for 24 times. It is surprising that,
being a field representative who has knowledge about illegal connection, it
escaped from his attention the said illegal connection when it could easily be
detected since his metering point is installed in front of his house.
We are not inclined to believe that he resorted to flying connection as it is
apparent that at the time his electric service was disconnected in April, 2003,
the Balagtas Branch found his service to have registered KWHR consumption
from 1555 to 2194 for a total of 639 KWHR indicating that although his
electric service was disconnected, it continued to register electricity.
Moreover, the burden of proof is upon him to present to us the one
responsible but he failed to do so. In the absence of such proof, it is concluded
that he, being the registered customer and a resident, was the one who
installed the illegal connection purposely to alleviate the sickly condition of
his wife and two children.9
In view of these findings, respondent Meralco, through its Senior Assistant
Vice President for Human Resources Administration R. A. Sapitula, issued on
February 4, 2004 a notice of dismissal10 addressed to the petitioner. The notice
cites violation of Section 7, paragraph 3 of Meralco's Company Code on
Employee Discipline and Article 282 (a), (c), (d) and (e) of the Labor Code of
the Philippines as bases for the dismissal. The pertinent portions of the notice
read:
Administrative investigation duly conducted by Legal established that on
October 3, 2003, acting on a tip that you are resorting to illegal service The Ruling of the NLRC
connection, the Company's Inspection Squad 7 team found two (2) shunting
wires in an energized empty meter base installed at your residence at #17
On March 31, 2006, the NLRC rendered its Resolution 15 dismissing the herein
Earth Street, Meralco Village, Batia, Bocaue, Bulacan. Your wife admitted
respondents' appeal for lack of merit. Subsequently, the NLRC denied for lack
that you were the one who installed the shunted wires on your meter base to
of merit the respondents’ motion for reconsideration via a Resolution16 dated
have power because she and your two children were sick. The illegal
August 28, 2006. This prompted the respondents to file a petition
connection enabled you to defraud the company by consuming unregistered
for certiorari with the CA.
electricity which makes you liable for violation of Section 7, par. 3 of the
Company Code on Employee Discipline, defined as "(d)irectly or indirectly
tampering with electric meters or metering installations of the Company or The Ruling of the CA
the installation of any device, with the purpose of defrauding the Company,"
penalized therein with dismissal from the service.
On August 10, 2009, the CA rendered the now assailed Decision 17 reversing
the rulings of the NLRC. In finding the petitioner's dismissal lawful, the
Under Article 282 of the Labor Code of the Philippines, the termination of appellate court attributed unto Yabut authorship of the meter tampering and
your employment in Meralco is justified on the following grounds: "(a) illegal use of electricity – acts which it regarded as serious misconduct. The
Serious misconduct x x x by the employee x x x in connection with his work; Court observed:
"(c) Fraud or willful breach by the employee of the trust reposed in him by his
employer or representative; "(d) Commission of a crime or offense by the
The Court notes that the meter base is located inside respondent Yabut's
employee against x x x his employer; and "(e) Other causes analogous to the
premises. Manila Electric Company vs. Court of Appeals said –
foregoing."

"x x x Metro Concast should bear the responsibility for the tampering of the
Based on the foregoing, Management is constrained to dismiss you for cause
facilities within its compound, which was totally under its supervision and
from the service and employ of the Company, as you are hereby so dismissed
control. Being within its control, any resultant breach in the integrity of the
effective February 5, 2004, with forfeiture of all rights and privileges.
equipment is indeed attributable to it."18 (citation omitted)

Aggrieved by the decision of the management, Yabut filed with the National
The court also ruled that the petitioner's right to due process was not violated,
Labor Relations Commission (NLRC) a complaint11 for illegal dismissal and
as he was served the required notices and given sufficient opportunity to be
money claims against Meralco and Lopez.
heard. In view of these, the CA annulled and set aside the NLRC's
resolutions via its decision, the dispositive portion of which reads:
The Ruling of the Labor Arbiter
WHEREFORE, the petition is granted. The resolutions dated March 31,
On December 28, 2004, Labor Arbiter Antonio R. Macam rendered his 2006 and August 28, 2006 are annulled and set aside.
Decision,12 declaring the petitioner illegally dismissed from the service and
hence, entitled to reinstatement plus backwages and attorney's fees. The
SO ORDERED.19
dispositive portion of his decision reads:

Yabut's motion for reconsideration was denied by the CA via a Resolution

WHEREFORE, premises all considered, judgment is hereby rendered, as
dated November 26, 2009.20 Hence, the present petition.
follows:

The Issue
1. Declaring the dismissal of complainant as illegal;

The issue for this Court's determination is: Whether or not the CA committed
2. Ordering respondents to reinstate complainant to his former
an error of law in annulling and setting aside the resolutions of the NLRC that
position without loss of seniority rights and privileges,
declared the herein petitioner illegally dismissed by the respondents.
immediately upon receipt of this decision, either physically or in
the payroll, at the option of the respondent;
The petitioner asserts that he was dismissed from employment without a valid
cause, and that due process prior to his termination was not observed by the
3. Ordering the respondents to pay complainant his full backwages
respondents.
from date of dismissal up to actual reinstatement, partially
computed as follows:
This Court's Ruling

Backwages = [₱]240,420.00
After study, this Court finds the petition devoid of merit.
13th Mo. Pay = 24,042.00
The dismissal of the petitioner was founded on just causes under Article
Total [P]264,462.00 282 of the Labor Code of the Philippines.
4. Ordering respondents to pay complainant attorney's fees
equivalent to 10% of his monetary award. Article 279 of the Labor Code of the Philippines provides that "(i)n cases of
regular employment, the employer shall not terminate the services of an
employee except for a just cause or when authorized by this Title. x x x" The
All other claims are dismissed for lack of merit. just causes are enumerated in Article 282, which provides:

SO ORDERED.13 Article 282. Termination by employer. - An employer may terminate an

employment for any of the following causes:
The labor arbiter observed that there was no clear and direct evidence to
prove that Yabut performed the shunting of his metering installation. (a) Serious misconduct or willful disobedience by the employee of
Furthermore, the act imputed upon Yabut was not related to the performance the lawful orders of his employer or representative in connection
of his duties as a Meralco employee, but as a customer of the company's with his work;
electric business. Finally, it was ruled that Meralco failed to observe the twin
requirements of due process in termination cases. The records are bereft of
any evidence showing that the petitioner was apprised of the particular acts or (b) Gross and habitual neglect by the employee of his duties;
omissions for which his dismissal was then sought.
(c) Fraud or willful breach by the employee of the trust reposed in
Unsatisfied, the respondents appealed from the decision of the labor arbiter to him by his employer or duly authorized representative;
the NLRC.14
(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; and
(e) Other causes analogous to the foregoing.
The requirement for a just cause was satisfied in this case. We note that the
petitioner's employment was terminated by the herein respondents for
violation of Section 7, par. 3 of Meralco's Company Code on Employee
Discipline, and for the existence of just cause under Article 282 (a), (c), (d)
and (e) of the Labor Code.
The petitioner's violation of the company rules was evident. While he denies
any involvement in the installation of the shunting wires which Meralco
discovered, it is significant that said SIN 708668501 is registered under his
name, and its meter base is situated within the premises of his property. Said
meter registered electric consumption during the time his electric service was
officially disconnected by Meralco. It was the petitioner and his family who
could have benefited from the illegal connection, being the residents of the
area covered by the service. His claim that he failed to know or even notice
the shunted wires fails to persuade as we consider the meter located in the
front of his house, the nature of his work as branch field representative, his
long-time employment with Meralco and his familiarity with illegal
connections of this kind.
The logical conclusion that may be deduced from these attending
circumstances is that the petitioner was a party, or at the very least, one who
agreed to the installation of the shunted wires, and who also benefited from
the illegal connection at the expense of his employer-company. In sustaining
the CA's findings, we consider the rule that in administrative and quasi-
judicial proceedings, as in proceedings before the NLRC which had original
jurisdiction over the complaint for illegal dismissal, the quantum of proof
necessary is substantial evidence or such relevant evidence as a reasonable
mind may accept as adequate to support a conclusion.21
Significantly, "(t)ampering with electric meters or metering installations of
the Company or the installation of any device, with the purpose of defrauding
the Company" is classified as an act of dishonesty from Meralco employees,
expressly prohibited under company rules. It is reasonable that its commission
is classified as a severe act of dishonesty, punishable by dismissal even on its
first commission, given the nature and gravity of the offense and the fact that
it is a grave wrong directed against their employer.1avvphi1
To reiterate, Article 282 (a) provides that an employer may terminate an
employment because of an employee's serious misconduct, a cause that was
present in this case in view of the petitioner's violation of his employer's code
of conduct. Misconduct is defined as the "transgression of some established
and definite rule of action, a forbidden act, a dereliction of duty, willful in
character, and implies wrongful intent and not mere error in judgment." For
serious misconduct to justify dismissal, the following requisites must be
present: (a) it must be serious; (b) it must relate to the performance of the
employee's duties; and (c) it must show that the employee has become unfit to
continue working for the employer.22
In reviewing the CA’s Decision, we again consider the petitioner's duties and
powers as a Meralco employee. And we conclude that he committed a serious
misconduct. Installation of shunting wires is without doubt a serious wrong as
it demonstrates an act that is willful or deliberate, pursued solely to
wrongfully obtain electric power through unlawful means. The act clearly
relates to the petitioner's performance of his duties given his position as
branch field representative who is equipped with knowledge on meter
operations, and who has the duty to test electric meters and handle customers'
violations of contract. Instead of protecting the company’s interest, the
petitioner himself used his knowledge to illegally obtain electric power from
Meralco. His involvement in this incident deems him no longer fit to continue
performing his functions for respondent-company.
While the installation of the shunted wires benefited the herein petitioner as a
customer of Meralco, his act cannot be fully severed from his status as the
respondent's employee. As correctly observed by the CA, "(i)t is an offense
against the Company Code of Employee Discipline. As a field representative,
he is knowledgeable on the mechanics of meter and metering installation."23
The dismissal is also justified as the act imputed upon the petitioner qualifies
as "fraud or willful breach by the employee of the trust reposed in him by his
employer or duly authorized representative" under Article 282 (c) of the
Labor Code. While the petitioner contests this ground by denying that his
position is one of trust and confidence, it is undisputed that at the time of his
dismissal, he was holding a supervisory position after he rose from the ranks
since commencement of his employment with Meralco. As a supervisor with
duty and power that included testing of service meters and investigation of
violations of contract of customers, his position can be treated as one of trust
and confidence, requiring a high degree of honesty as compared with ordinary
rank-and-file employees. This Court declared in The Coca-Cola Export
Corporation v. Gacayan:24
Law and jurisprudence have long recognized the right of employers to dismiss
employees by reason of loss of trust and confidence. More so, in the case of
supervisors or personnel occupying positions of responsibility, loss of trust
justifies termination. Loss of confidence as a just cause for termination of
employment is premised from the fact that an employee concerned holds a
position of trust and confidence. This situation holds where a person is
entrusted with confidence on delicate matters, such as the custody, handling,
or care and protection 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.25 (citations omitted)
In this case, the acts complained of were clearly work-related because they
related to matters the petitioner handled as branch field representative. Taking
into account the results of its investigations, Meralco cannot be expected to
trust Yabut to properly perform his functions and to meet the demands of his
job. His dishonesty, involvement in theft and tampering of electric meters
clearly prejudice respondent Meralco, since he failed to perform the duties
which he was expected to perform.
Considering the foregoing, this Court agrees that there were just causes for
the petitioner's dismissal. We emphasize that dismissal of a dishonest
employee is to the best interest not only of the management but also of labor.
As a measure of self-protection against acts inimical to its interest, a company
has the right to dismiss its erring employees. An employer cannot be
compelled to continue employing an employee guilty of acts inimical to the
employer’s interest, justifying loss of confidence in him.26
The requirements of procedural due process were satisfied.
On the matter of procedural due process, it is well-settled that notice and
hearing constitute the essential elements of due process in the dismissal of
employees. The employer must furnish the employee with two written notices
before termination of employment can be legally effected. The first apprises
the employee of the particular acts or omissions for which dismissal is sought.
The second informs the employee of the employer's decision to dismiss him.
With regard to the requirement of a hearing, the essence of due process lies
simply in an opportunity to be heard, and not that an actual hearing should
always and indispensably be held.27
These requirements were satisfied in this case. The first required notice was
dated November 3, 2003, sufficiently notifying the petitioner of the particular
acts being imputed against him, as well as the applicable law and the
company rules considered to have been violated. Notably, in his sworn
statement dated November 17, 2003, the petitioner admitted receiving
Meralco's notice of investigation dated November 3, 2003, to wit:
37. T. Natanggap mo ba yong notice ng investigation na may petsang
November 3, 2003 na personally na ipinadala namin sa iyo sa
bahay mo na may numerong 17 Earth St., Meralco Village 8,
Batia, Bocaue, Bulacan?
S. Opo.
38. T. Ipinapakita ko sa iyo ang isang notice ng investigation na may
petsang November 3, 2003 na naka-addressed (sic) sa isang Mr.
Norman C. Yabut ng 17 Earth Street, Meralco Village 8, Batia,
Bocaue, Bulacan at ang may lagda ay si Atty. J.R.T. Albarico,
head ng Investigation-Litigation ng Meralco. Dito sa nasabing
notice ay may nakalagay sa ibaba na received by Salvacio (sic) M.
Yabut na may kanyang pirma, at nakalagay din ang date na
11/03/03 at ang nakalagay sa relationship ay wife. Ano ang
masasabi mo tungkol sa bagay na ito.
S. Ito po yong notice ng investigation na aking natanggap at ang nakatanggap
nito ay ang aking misis na si Maria Salvacion Yabut.28
On November 17, 2003, Meralco conducted a hearing on the charges against
the petitioner. During said time, the petitioner was accorded the right to air his
side and present his defenses on the charges against him. Significantly, a
high-ranking officer of the supervisory union of Meralco assisted him during
the said investigation. His sworn statement29 that forms part of the case
records even listed the matters that were raised during the investigation.

Finally, Meralco served a notice of dismissal dated February 4, 2004 upon the
petitioner. Such notice notified the latter of the company's decision to dismiss
him from employment on the grounds clearly discussed therein.

WHEREFORE, in view of the foregoing, the petition for review

on certiorari is hereby DENIED. The assailed Decision dated August 10,
2009 and Resolution dated November 26, 2009 of the CA in CA-G.R. SP No.
96789 are hereby AFFIRMED.

SO ORDERED.
G.R. No. 194813               April 25, 2012
Kakampi and its Members, Victor Panuelos, et al., represented by David
Dayalo, Kakampi Vice President and Attorney-in-Fact, Petitioner, vs.
Kingspoint Express and Logistic and/or MARY Ann Co, Respondents.
DECISION
REYES, J.:
This is a petition for review under Rule 45 of the Rules of Court of the
Amended Decision1 dated March 16, 2010 and Resolution2 dated December
16, 2010 of the Court of Appeals (CA) in CA-G.R. SP No. 106591.
Victor Pañuelos (Pañuelos), Bobby Dacara (Dacara), Alson Dizon (Dizon),
Saldy Dimabayao (Dimabayao), Fernando Lupangco, Jr. (Lupangco), Sandy
Pazi (Pazi), Camilo Tabarangao, Jr. (Tabarangao), Eduardo Hizole (Hizole)
and Reginald Carillo (Carillo) were the former drivers of Kingspoint Express
and Logistic (Kingspoint Express), a sole proprietorship registered in the
name of Mary Ann Co (Co) and engaged in the business of transport of
goods. They were dismissed from service on January 20, 2006 on the grounds
of serious misconduct, dishonesty, loss of trust and confidence and
commission of acts inimical to the interest of Kingspoint Express.
Prior thereto, Kingspoint Express issued separate notices to explain to the
individual petitioners on January 16, 2006, uniformly stating that:
RE: CHARGES OF DISHONESTY SERIOUS MISCONDUCT &
LOSS OF CONFIDENCE
Dear Mr. Dacara:
You are hereby formally charged with DISHONESTY, SERIOUS
MISCONDUCT, LOSS OF CONFIDENCE, and acts inimical to the
company, by filing with the National Labor Relations Commission
(NLRC) false, malicious, and fabricated cases against the company.
Further, your refusal to undergo drug testing is unwarranted and
against company policy.
Please submit your answer or explanation to the foregoing charges
within forty-eight (48) hours [from] receipt hereof. Your failure to do
so would mean that you waive your right to submit your answer.
You may likewise opt for a formal investigation with the assistance
of counsel, or proceed with the investigation as you may choose.
In the meantime, you are place[d] under preventive suspension for
thirty (30) days effective on January 16, 2006. You are physically
barred from company premises while the preventive suspension
exists[.]3
The individual petitioners failed to submit their written explanation within the
stated period. Subsequently, Kingspoint Express issued to them separate yet
uniformly worded notices on January 20, 2006, informing them of their
dismissal. Kingspoint Express expressed its decision in this wise:
On January 16, 2006, you were formally charged with DISHONESTY,
SERIOUS MISCONDUCT and LOSS OF CONFIDENCE and ACTS
INIMICAL TO THE COMPANY based on the following acts:
1. FABRICATION OF BASELESS MONEY CLAIMS against
the company;
2. MISLEADING FELLOW CO-WORKERS to sign the
MALICIOUS COMPLAINT FOR MONEY CLAIMS against the
company;
3. REFUSAL TO UNDERGO THE COMPANY’S GENERAL
DRUG TEST[;]
4. EXTORTING MONEY FROM CO-WORKERS TO FUND
ACTIVITIES THAT THEY WERE NEVER FULLY
INFORMED OF;
You were given two (2) days to respond to these charges, but you failed to do
[so].4
In addition to the foregoing, Dacara was dismissed for consummating his
sexual relations with one of Co’s household helpers inside Co’s residence
thus impregnating her.5
A complaint for illegal dismissal was subsequently filed, alleging that the
charges against them were fabricated and that their dismissal was prompted
by Kingspoint Express’ aversion to their union activities.
In a Decision6 dated April 23, 2007, Labor Arbiter Cresencio G. Ramos, Jr.
(LA Ramos) found Dacara, Lupangco, Pazi, Tabarangao, Hizole and Carillo
illegally dismissed. On the other hand, the complaint was dismissed insofar as
Panuelos, Dizon and Dimabayao are concerned as they were deemed not to
have filed their position papers. While the allegation of anti-unionism as the
primordial motivation for the dismissal is considered unfounded, the
respondents failed to prove that the dismissal was for a just cause. The
pertinent portion of the decision reads:
From a perusal and examination of the pieces of evidence adduced by the
respondents in support of their defense, this Office finds the same as not
being sufficient and substantial to establish the charges of serious misconduct
and breach of trust. Consider the following:
On the complainants’ alleged refusal to undergo the company’s general drug
testing, the same is explicitly nothing but an unsubstantiated allegation,
therefore, undeserving of judicial and quasi-judicial cognizance.
On the alleged act of the complainants in extorting money from co-workers to
fund activities that they were not fully informed of as well as the alleged
misleading of co-workers to sign "malicious money claims" against the
company, it is to be noticed that respondents’ support or evidence thereto are
the joint affidavit of drivers and helpers as well as that of one Ronie Dizon.
On said pieces of evidence, this Office could not give much probative or
evidentiary value and weight thereto as said sworn statements may definitely
not be said to have genuinely emanated from the affiants (sic) drivers and
helpers. To be precise, the joint-affidavit of the drivers and helpers (annex
"B", respondents’ position paper) obviously was "tailor-made", so to speak, to
conform with the respondents’ position or defense in the instant case. Said
joint-affidavit in fact is couched in english, thus, tremendously lowering the
probability that the statements therein really came from the "hearts and souls"
of the lowly-educated drivers and helpers.
On the breach of trust allegedly committed by Bobby Dacara with respect to
the alleged act of repeatedly sneaking in the household of respondent Mary
Ann Co and thereafter impregnating one of the latter’s househelps, the same
is nothing but an unsubstantiated allegation and therefore, undeserving of
judicial and quasi-judicial cognizance. Jurisprudence definitely is explicit on
this point that an affirmative allegation made by a party must duly be proven
to merit acceptance (People vs. Calayca, 301 SCRA 192).7
On appeal, the National Labor Relations Commission (NLRC) affirmed LA
Ramos’ Decision dated April 23, 2007 in its Resolution 8 dated April 30, 2008,
thus:
In the case at bar, We are persuaded to agree with the findings of the Labor
Arbiter that "the pieces of evidence adduced by the respondents in support of
their defense x x x not being sufficient and substantial to establish the charges
of serious misconduct and breach of trust" (Records, p. 96).9
In addition, the NLRC ruled that the respondents failed to comply with the
procedural requirements of due process. Specifically:
It is also observed that much is to be desired insofar as the observance of the
procedural due process aspect is concerned. Firstly, there was no compliance
with the due process requirement of the law considering that the uniformly
worded first notice, all dated January 16, 2006, sent by respondents-appellants
to the complainants-appellees, did not apprise them of the particular acts or
omission for which their dismissal were sought. As clearly shown by the said
individual notices, each of the complainants-appellees was merely informed
that he or she is "formally charged with DISHONESTY, SERIOUS
MISCONDUCT, LOSS OF CONFIDENCE and acts inimical to the
Company" x x x without specifying the particular or specific acts or
omissions constituting the grounds for their dismissal.
The purpose of the first notice is to sufficiently apprise the employee of the
acts complained of and to enable the employee to prepare his defense. In this
case, though, the said first notice did not identify the particular acts or
omissions committed by each of the complainants-appellees. The extent of
their knowledge and participation in the generally described charges were not
specified in the said first notice, hence, the complainants-appellee could not
be expected to intelligently and adequately prepare their defense. The first
notice should neither be pro-forma nor vague; that it should set out clearly
what each of the employees is being held liable for. They should be given
ample opportunity to be heard and not mere opportunity. Ample opportunity
means that each of the complainants-appellees should be specifically
informed of the charges in order to give each of them, an opportunity to refute
such accusations. Since, the said first notices are inadequate, their dismissal
could not be in accordance with due process x x x.
Secondly, there was no just or authorized cause for the respondents-appellants
to terminate the complainants-appellees’ services. It is observed that the
Notices of Termination, all dated January 20, 2006, merely mentioned the
ground relied upon, to wit:
xxxx
Placing side by side the first (1st) notices and the Notice of Termination, We
can easily notice the wide disparity between them. In the first (1st) notices,
the alleged charges leveled against each of complainants-appellees were
couched in general terms, such as: DISHONESTY, SERIOUS
MISCONDUCT, LOSS OF CONFIDENCE and ACTS INIMICAL TO THE
COMPANY, such that the complainants-appellees could not be expected to
prepare their responsive pleadings; while the uniformly worded Notices of
Termination, as earlier quoted, the charges leveled against of (sic) them are
more specific.10
Respondents moved for reconsideration and in a Decision11 dated July 17,
2008, the NLRC reversed itself and declared the individual petitioners legally
dismissed:
Respondent company is an entity engaged in the delivery of goods called
"door-to-door" business. As such, respondents are in custody of goods and
moneys belonging to customers. Thus, respondents want to ensure that their
drivers are drug-free and honest. It is undeniable that persons taking
prohibited drugs tend to commit criminal activities when they are "high", as
most of them are out of their minds. Complainants are drivers and are on the
road most of the time. Thus, they must see to it that they do not cause damage
to other motor vehicles and pedestrians.
Likewise, when delivering goods and money, it is not impossible that they
could commit acts inimical to the respondents’ interest, like failure to deliver
the money or goods to the right person or do a "hold-up me" scenario.
Thus, to guarantee complainants-drivers’ safety and effective performance of
their assigned tasks, respondents ordered complainants to undergo drug
testing. However, they refused to follow the directive. Neither did they give a
clear explanation for their refusal to the respondents. This shows
complainants’ wrongful attitude to defy the reasonable orders which
undoubtedly pertain to their duties as drivers of the respondents. Such act is
tantamount to willful disobedience of a lawful order, a valid ground for
dismissal under the Labor Code, as amended.
Furthermore, employees who are not complainants in this case, in a sworn
statement attested to the fact that complainants tricked them to sign papers
which turned out to be a complaint for money claims. They also accused them
of abusing their trust in order to achieve their selfish motives. Complainants
even convinced them to shell out part of their salaries without authorization
and consent, as "panggatos para sa papeles, transportasyon ng abugado" but
said money was used for the Union’s purposes. Worse, complainants even
threatened them to file criminal charges against them if they did not follow
the complainants’ evil plans. x x x
In their Rejoinder, respondents also mentioned about the loss of cargoes to be
delivered to Pampanga and Nueva Ecija. Complainants failed to refute the
allegations nor comment on the matter. This led to respondents’ loss of trust
and confidence reposed in them. Considering that the drivers have in their
possession money and goods to be delivered, the continuance of their
employment depends on the trust and confidence in them. Undeniably, trust,
once lost is hard to regain.
xxxx
We disagree.
On January 16, 2006, respondents sent each of the complainants a letter
stating the infractions committed by them. They directed them to explain the
said infractions with a warning that failure to do so would mean waiver of
their right to submit their answer. They further advised them to "opt for a
formal investigation with assistance of the counsel, or proceed with the
investigation you may choose".
However, complainants failed to answer. Neither did they do any act to
dispute the charges. They remained silent on the infractions which a person
would not normally do if he is not guilty of the said charges. If they were
really innocent, immediately, even without any notice, they should have
reacted and did everything to dispute the charges. But they failed, despite the
notice to explain. This would lead to the conclusion that they were guilty of
the charges imputed against them. As a consequence thereof, the
complainants are considered to have waived their right to defend
themselves.12
Petitioners moved for reconsideration but the same was denied in a
Resolution13 dated September 30, 2008.
Subsequently, the petitioners filed a petition for certiorari with the CA. In a
Decision14 dated July 17, 2009, the CA reversed and set aside the NLRC
Decision dated July 17, 2008 and Resolution dated September 30, 2008.
Thus:
Initially, this Court must determine whether the petitioners violated the
Company Policies as would warrant their dismissal from the service.
However, a painstaking review of the records of this case negate[s] a finding
of such culpability on the part of the petitioners.
The charges of dishonesty, serious misconduct and loss of confidence against
the petitioners are nothing more than bare allegations as neither the show
cause orders nor the termination letters specify in clear and unmistakable
manner, the specific acts committed by the petitioners as would amount to
dishonesty, serious misconduct or loss of confidence. Neither of these notices
even contain any averments as to how and when the alleged infractions were
committed by the petitioners.
xxx
In this case, respondent company had not been able to identify an act of
dishonesty, serious misconduct or any illicit act, which the petitioners may
have committed in connection with their work, except the allegation that
petitioners filed false, malicious, and fabricated cases against the company
which, under the Labor Code, is not a valid ground for termination of
employment. There is even no mention of any company policy or rule
violated by any of the petitioners to warrant their dismissal. The charges are
clearly unfounded.
xxxx
The superficial compliance with two notices and a hearing in this case cannot
be considered valid where the notices to explain where issued four (4) days
before the petitioners were terminated. The termination was obviously
hurriedly effected, as the respondent failed to give the petitioners the avenue
to contradict the charges against them either by submission of their answer or
by the conduct of an actual investigation in order to give spirit to the
requirement of due process. Petitioners were thus robbed of their rights to
explain their side, to present evidence and rebut what was presented against
them, rights ensured by the proper observance of procedural due process.15
Respondents promptly filed a motion for reconsideration. Similar to the
NLRC, the CA reversed itself and retracted its earlier finding that the
individual petitioners were illegally dismissed. In its Amended
Decision16 dated March 16, 2010, the CA concluded that the two (2) notices
issued by Kingspoint Express complied with the requirements of the law:
In the assailed Decision, We conceded that all the petitioners were actually
furnished with a letter dated 16 January 2006. In each letter, petitioners were
individually charged with "dishonesty, serious misconduct, loss of confidence
for performing acts inimical to the company by filing with the NLRC false,
malicious and fabricated cases against the company and their refusal to
undergo drug testing." They were directed to submit an answer or explanation
within forty-eight (48) hours and were even given the option to avail of a
formal investigation with the assistance of counsel. They were further advised
that failure to submit said answer/explanation would mean waiver on their
part. Thus, when they failed to submit an explanation/Answer, and failed to
inform their employer that they wanted a formal investigation on the matter,
their employer was constrained to serve upon them on 20 January 2006, or
four (4) days later, separate notices of termination stating the offenses they
committed, viz.:
xxxx
Show-cause letters/memoranda create a burden on the employees to explain
their innocence. In turn, it is from such explanation that the employer will be
obliged to prove his case in an investigation. Since the petitioners did not
explain, much less invoke their right to investigation, it follows that they are
deemed to have waived their rights under Art. 277(b) of the Labor Code.
Technically, the law on evidence considers them to have admitted the charges
against them. With such admission, the employer is discharged from the need
to prove the offenses charged. It is well-settled that in any forum, whether
judicial or administrative, a party need not prove what is admitted. 17 (Citations
omitted)
The CA also held that the individual petitioners performed acts, which
constitute serious misconduct:
allege that this was what motivated the dismissal of the petitioners, but the
duty to prove such an accusation is altogether different. That the petitioners
failed at the level of substantiation only goes to show that their claim of unfair
labor practice is a mere subterfuge for their willful disobedience.
As to the second element, no belabored and extensive discussion is necessary
to recognize the relevance of the subject order in the performance of their
functions as drivers of Kingspoint Express. As the NLRC correctly pointed
out, drivers are indispensable to Kingspoint Express’ primary business of
rendering door-to-door delivery services. It is common knowledge that the
use of dangerous drugs has adverse effects on driving abilities that may
render the dismissed employees incapable of performing their duties to
Kingspoint Express and acting against its interests, in addition to the threat
they pose to the public.
The existence of a single just cause is enough to order their dismissal and it is
now inconsequential if the other charges against them do not merit their
dismissal from service. It is therefore unnecessary to discuss whether the
other acts enumerated in the notices of termination issued by Kingspoint
Express may be considered as any of the just causes.

The assailed Decision admits what constitutes serious misconduct.

Here, except for Bobby Dacara, each of the three petitioners conceded the
existence of the following bases for their dismissal: (1) complainants’ refusal
to undergo mandatory drug-testing; (2) creating disharmony and distrust
among the workers and misleading them to go against the employer; and (3)
losing cargo with a value of P250,000.00 entrusted to respondent company for
door-to-door delivery.
Verily, each of the aforestated grounds independently constitute[s] serious
misconduct. Each of them were (sic) committed in relation to petitioners’
work. And again, the commission of said infractions constitutes a ground to
dismiss under Art. 282(a) of the Code. The Court, therefore, gravely erred
when it held that no serious misconduct was committed by petitioners in this
case.
On the other hand, in the case of Bobby Dacara, records show that he
committed breach of trust and confidence by sneaking into the house of
private respondent Co and engaging one of Co’s helpers in repeated sexual
congress leading to her pregnancy. As held in Santos, Jr. vs. NLRC, such
behavior amounts to immorality which is a case of serious misconduct; a just
cause to dismiss an employee.18 (Citation omitted)
Nonetheless, while Kingspoint Express had reason to sever their employment
relations, this Court finds its supposed observance of the requirements of
procedural due process pretentious. While Kingspoint Express required the
dismissed employees to explain their refusal to submit to a drug test, the two
(2) days afforded to them to do so cannot qualify as "reasonable opportunity",
which the Court construed in King of Kings Transport, Inc. v. Mamac21 as a
period of at least five (5) calendar days from receipt of the notice.
Thus, even if Kingspoint Express’ defective attempt to comply with
procedural due process does not negate the existence of a just cause for their
dismissal, Kingspoint Express is still liable to indemnify the dismissed
employees, with the exception of Panuelos, Dizon and Dimabayao, who did
not appeal the dismissal of their complaints, with nominal damages in the
amount of ₱30,000.00.
WHEREFORE, premises considered, the Decision dated March 16, 2010 and
Resolution dated December 16, 2010 of the Court of Appeals are AFFIRMED
with MODIFICATION in that respondent Kingspoint Express and Logistic is
hereby held liable for the payment of nominal damage, in the amount of
₱30,000.00 each to petitioners Bobby Dacara, Fernando Lupangco, Jr., Sandy
Pazi, Camilo Tabarangao, Jr., Eduardo Hizole and Reginaldo Carillo, for non-
observance of procedural due process required in terminating employment.

Petitioners moved for reconsideration but this was denied by the CA in its SO ORDERED.
Resolution19 dated December 16, 2010.

The lone issue for the disposition of this Court is the validity of the individual
petitioners’ dismissal.

It is fundamental that in order to validly dismiss an employee, the employer is

required to observe both substantive and procedural due process – the
termination of employment must be based on a just or authorized cause and
the dismissal must be effected after due notice and hearing.20

As to whether Kingspoint Express complied with the substantive

requirements of due process, this Court agrees with the CA that the concerned
employees’ refusal to submit themselves to drug test is a just cause for their
dismissal.

An employer may terminate an employment on the ground of serious

misconduct or willful disobedience by the employee of the lawful orders of
his employer or representative in connection with his work.  Willful
disobedience requires the concurrence of two elements: (1) the employee's
assailed conduct must have been willful, that is, characterized by a wrongful
and perverse attitude; and (2) the order violated must have been reasonable,
lawful, made known to the employee, and must pertain to the duties which he
had been engaged to discharge. Both elements are present in this case.

As to the first element, that at no point did the dismissed employees deny
Kingspoint Express’ claim that they refused to comply with the directive for
them to submit to a drug test or, at the very least, explain their refusal gives
rise to the impression that their non-compliance is deliberate. The utter lack of
reason or justification for their insubordination indicates that it was prompted
by mere obstinacy, hence, willful and warranting of dismissal.

It involves little difficulty to accuse Kingspoint Express of anti-unionism and

G.R. No. 172044               February 06, 2013
CAVITE APPAREL, INCORPORATED and ADRIANO
TIMOTEO, Petitioners, vs.
MICHELLE MARQUEZ, Respondent.
DECISION
BRION, J.:
We resolve the petition for review on certiorari1filed by petitioners Cavite
Apparel, Incorporated ( Cavite Apparel)  and Adriano Timoteo to nullify the
decision2 dated January 23, 2006 and the resolution3 dated March 23, 2006 of
the Court of Appeals ( CA) in C.A.-G.R. SP No. 89819 insofar as it affirmed
the disposition4 of the National Labor Relations Commission (NLRC) in
NLRC CA No. 029726-01. The NLRC set aside the decision 5 of Labor
Arbiter (LA) Cresencio G. Ramos in NLRC NCR Case No. RAB-IV-7-
12613-00-C dismissing the complaint for illegal dismissal filed by respondent
Michelle Marquez against the petitioners.
The Factual Antecedents
Cavite Apparel is a domestic corporation engaged in the manufacture of
garments for export. On August 22, 1994, it hired Michelle as a regular
employee in its Finishing Department. Michelle enjoyed, among other
benefits, vacation and sick leaves of seven (7) days each per annum. Prior to
her dismissal on June 8, 2000, Michelle committed the following infractions
(with their corresponding penalties):
a. First Offense: Absence without leave (AWOL) on December 6,
1999 – written warning
b. Second Offense: AWOL on January 12, 2000 – stern warning
with three (3) days suspension
c. Third Offense: AWOL on April 27, 2000 – suspension for six
(6) days.6
On May 8, 2000, Michelle got sick and did not report for work. When she
returned, she submitted a medical certificate. Cavite Apparel, however,
denied receipt of the certificate.7 Michelle did not report for work on May 15-
27, 2000 due to illness. When she reported back to work, she submitted the
necessary medical certificates. Nonetheless, Cavite Apparel suspended
Michelle for six (6) days (June 1-7, 2000). When Michelle returned on June 8,
2000, Cavite Apparel terminated her employment for habitual absenteeism.
On July 4, 2000, Michelle filed a complaint for illegal dismissal with prayer
for reinstatement, backwages and attorney’s fees with the NLRC, Regional
Arbitration Branch No. IV.
The LA Ruling
In a decision dated April 28, 2001,8 LA Ramos dismissed the complaint. He
noted that punctuality and good attendance are required of employees in the
company’s Finishing Department. For this reason, LA Ramos considered
Michelle’s four absences without official leave as habitual and constitutive of
gross neglect of duty, a just ground for termination of employment. LA
Ramos also declared that due process had been observed in Michelle’s
dismissal, noting that in each of her absences, Cavite Apparel afforded
Michelle an opportunity to explain her side and dismissed her only after her
fourth absence. LA Ramos concluded that Michelle’s dismissal was valid.9
The NLRC Decision
On appeal by Michelle, the NLRC referred the case to Executive LA Vito C.
Bose for review, hearing and report.10 Adopting LA Bose’s report, the NLRC
rendered a decision11 dated May 7, 2003 reversing LA Ramos’ decision. The
NLRC noted that for Michelle’s first three absences, she had already been
penalized ranging from a written warning to six days suspension. These, the
NLRC declared, should have precluded Cavite Apparel from using Michelle’s
past absences as bases to impose on her the penalty of dismissal, considering
her six years of service with the company. It likewise considered the penalty
of dismissal too severe. The NLRC thus concluded that Michelle had been
illegally dismissed and ordered her reinstatement with backwages. 12 When the
NLRC denied Cavite Apparel’s motion for reconsideration in a
resolution13 dated March 30, 2005, Cavite Apparel filed a petition
for certiorari with the CA to assail the NLRC ruling.
The CA Ruling
Cavite Apparel charged the NLRC with grave abuse of discretion when it set
aside the LA’s findings and ordered Michelle’s reinstatement. It disagreed
with the NLRC’s opinion that Michell’s past infractions could no longer be
used to justify her dismissal since these infractions had already been
penalized and the corresponding penalties had been imposed.
The CA found no grave abuse of discretion on the part of the NLRC and
accordingly dismissed Cavite Apparel’s petition on January 23, 2006.14 While
it agreed that habitual absenteeism without official leave, in violation of
company rules, is sufficient reason to dismiss an employee, it nevertheless did
not consider Michelle’s four absences as habitual. It especially noted that
Michelle submitted a medical certificate for her May 8, 2000 absence, and
thus disregarded Cavite Apparel’s contrary assertion. The CA explained that
Michelle’s failure to attach a copy of the medical certificate in her initiatory
pleading did not disprove her claim.
The CA agreed with the NLRC that since Cavite Apparel had already
penalized Michelle for her three prior absences, to dismiss her for the same
infractions and for her May 8, 2000 absence was unjust. Citing jurisprudence,
The CA concluded that her dismissal was too harsh, considering her six years
of employment with Cavite Apparel; it was also a disproportionate penalty as
her fourth infraction appeared excusable.
In its March 23, 2006 resolution,15 the CA denied Cavite Apparel’s motion for
reconsideration; hence, Cavite Apparel’s present recourse.
The Petition
Cavite Apparel imputes grave abuse of discretion against the CA when:
1. it did not find that the NLRC committed grave abuse of
disretion in setting aside the decision of the CA;
2. it failed to consider Michelle’s four (4) AWOLs over a period of
six months, from December 1999 to May 2000, habitual; and
3. it ruled that the series of violations of company rules committed
by Michelle were already meted with the corresponding
penalties.16
Cavite Apparel argues that it is its prerogative to discipline its employees. It
thus maintains that when Michelle, in patent violation of the company’s rules
of discipline, deliberately, habitually, and without prior authorization and
despite warning did not report for work on May 8, 2000, she committed
serious misconduct and gross neglect of duty. It submits that dismissal for
violation of company rules and regulations is a dismissal for cause as the
Court stressed in Northern Motors, Inc., v. National Labor Union, et al.17
The Case for the Respondent
Michelle asserts that her dismissal was arbitrary and unreasonable. For one,
she had only four absences in her six (6) years of employment with Cavite
Apparel. She explains that her absence on May 8, 2000 was justified as she
was sick and had sick leave benefits against which Cavite Apparel could have
charged her absences. Also, it had already sanctioned her for the three prior
infractions. Under the circumstances, the penalty of dismissal for her fourth
infraction was very harsh. Finally, as the CA correctly noted, Cavite Apparel
terminated her services on the fourth infraction, without affording her prior
opportunity to explain.
The Court’s Ruling
The case poses for us the issue of whether the CA correctly found no grave
abuse of discretion when the NLRC ruled that Cavite Apparel illegally
terminated Michelle’s employment.
We stress at the outset that, as a rule, the Court does not review questions of
fact, but only questions of law in an appeal by certiorari under Rule 45 of the
Rules of Court.18 The Court is not a trier of facts and will not review the
factual findings of the lower tribunals as these are generally binding and
conclusive.19 The rule though is not absolute as the Court may review the
facts in labor cases where the findings of the CA and of the labor tribunals are
contradictory.20 Given the factual backdrop of this case, we find sufficient
basis for a review as the factual findings of the LA, on the one hand, and
those of the CA and the NLRC, on the other hand, are conflicting.
After a careful review of the merits of the case, particularly the evidence
adduced, we find no reversible error committed by the CA when it found no
grave abuse of discretion in the NLRC ruling that Michelle had been illegally
dismissed.
Michelle’s four absences were not habitual; "totality of infractions"
doctrine not applicable
Cavite Apparel argues that Michelle’s penchant for incurring unauthorized
and unexcused absences despite its warning constituted gross and habitual
neglect of duty prejudicial to its business operations. It insists that by going
on absence without official leave four times, Michelle disregarded company
rules and regulations; if condoned, these violations would render the rules
ineffectual and would erode employee discipline.
Cavite Apparel disputes the CA’s conclusion that Michelle’s four absences
without official leave were not habitual since she was able to submit a
medical certificate for her May 8, 2000 absence. It asserts that, on the
contrary, no evidence exists on record to support this conclusion. It maintains
that it was in the exercise of its management prerogative that it dismissed
Michelle; thus, it is not barred from dismissing her for her fourth offense,
although it may have previously punished her for the first three offenses.
Citing the Court’s ruling in Mendoza v. NLRC,21 it contends that the totality of
Michelle’s infractions justifies her dismissal.
We disagree and accordingly consider the company’s position
unmeritorious.
Neglect of duty, to be a ground for dismissal under Article 282 of the Labor
Code, must be both gross and habitual.22 Gross negligence implies want of
care in the performance of one’s duties. Habitual neglect imparts repeated
failure to perform one’s duties for a period of time, depending on the
circumstances.23 Under these standards and the circumstances obtaining in the
case, we agree with the CA that Michelle is not guilty of gross and habitual
neglect of duties.
Cavite Apparel faults the CA for giving credit to Michelle’s argument that she
submitted a medical certificate to support her absence on May 8, 2000; there
was in fact no such submission, except for her bare allegations. It thus argues
that the CA erred in holding that since doubt exists between the evidence
presented by the employee and that presented by the employer, the doubt
should be resolved in favor of the employee. The principle, it contends, finds
no application in this case as Michelle never presented a copy of the medical
certificate. It insists that there was no evidence on record supporting
Michelle’s claim, thereby removing the doubt on her being on absence
without official leave for the fourth time, an infraction punishable with
dismissal under the company rules and regulations.
Cavite Apparel’s position fails to convince us. Based on what we see in the
records, there simply cannot be a case of gross and habitual neglect of duty
against Michelle. Even assuming that she failed to present a medical
certificate for her sick leave on May 8, 2000, the records are bereft of any
indication that apart from the four occasions when she did not report for
work, Michelle had been cited for any infraction since she started her
employment with the company in 1994. Four absences in her six years of
service, to our mind, cannot be considered gross and habitual neglect of duty,
especially so since the absences were spread out over a six-month period.
Michelle might have been guilty of violating company rules on leaves of
absence and employee discipline, still we find the penalty of dismissal
imposed on her unjustified under the circumstances. As earlier mentioned,
Michelle had been in Cavite Apparel’s employ for six years, with no
derogatory record other than the four absences without official leave in
question, not to mention that she had already been penalized for the first three
absences, the most serious penalty being a six-day suspension for her third
absence on April 27, 2000.
While previous infractions may be used to support an employee’s dismissal
from work in connection with a subsequent similar offense, 26 we cautioned
employers in an earlier case that although they enjoy a wide latitude of
discretion in the formulation of work-related policies, rules and regulations,
their directives and the implemtation of their policies must be fair and
reasonable; at the very least, penalties must be commensurate to the offense
involved and to the degree of the infraction.27
As we earlier expressed, we do not consider Michelle’s dismissal to be
commensurate to the four absences she incurred for her six years of service
with the company, even granting that she failed to submit on time a medical
certificate for her May 8, 2000 absence. We note that she again did not report
for work on May 15 to 27, 2000 due to illness. When she reported back for
work, she submitted the necessary medical certificates. The reason for her
absence on May 8, 2000 – due to illness and not for her personal convenience
– all the more rendered her dismissal unreasonable as it is clearly
disproportionate to the infraction she committed.
Finally, we find no evidence supporting Cavite Apparel’s claim that
Michelle’s absences prejudiced its operations; there is no indication in the
records of any damage it sustained because of Michelle’s absences. Also, we
are not convinced that allowing Michelle to remain in employment even after
her fourth absence or the imposition of a lighter penalty would result in a
breakdown of discipline in the employee ranks. What the company fails to
grasp is that, given the unreasonableness of Michelle’s dismissal – i.e., one
made after she had already been penalized for her three previous absences,
with the fourth absence imputed to illness – confirming the validity of her
dismissal could possibly have the opposite effect. It could give rise to belief
that the company is heavy-handed and may only give rise to sentiments
against it.
In fine, we hold that Cavite Apparel failed to discharge the burden of proving
that Michelle’s dismissal was for a lawful cause. 28 We, therefore, find her to
have been illegally dismissed.
As a final point, we reiterate that while we recognize management’s
prerogative to discipline its employees, the exercise of this prerogative should
at all times be reasonable and should be tempered with compassion and
understanding.29 Dismissal is the ultimate penalty that can be imposed on an
employee. Where a penalty less punitive may suffice, whatever missteps may
be committed by labor ought not to be visited with a consequence so severe
for what is at stake is not merely the employee’s position but his very
livelihood and perhaps the life and subsistence of his family.30
WHEREFORE, premises considered, the petition is DENIED. The assailed
January 23, 2006 decision and March 23, 2006 resolution of the Court of
Appeals in CA-G.R. SP No. 89819 are AFFIRMED. Costs against Cavite
Apparel, Incorporated.
SO ORDERED.

Michelle’s penalty of dismissal too harsh or not proportionate to the

infractions she commited

Although Michelle was fully aware of the company rules regarding leaves of
absence, and her dismissal might have been in accordance with the rules, it is
well to stress that we are not bound by such rules. In Caltex Refinery
Employees Association v. NLRC24 and in the subsequent case of Gutierrez v.
Singer Sewing Machine Company,25 we held that "[e]ven when there exist
some rules agreed upon between the employer and employee on the subject of
dismissal, x x x the same cannot preclude the State from inquiring on whether
[their] rigid application would work too harshly on the employee." This Court
will not hesitate to disregard a penalty that is manifestly disproportionate to
the infraction committed.
G.R. No. 184116               June 19, 2013 (NLRC) affirmed the LA’s ruling in toto.15 It ruled that the various
memoranda issued by Century Iron explicitly show that Bañas was an
inventory clerk. It noted that Century Iron unequivocally stated in its
CENTURY IRON WORKS, INC. and BENITO CHUA, Petitioners, vs.
termination report dated July 29, 2002 that Bañas was an inventory clerk. It
ELETO B. BANAS, Respondent.
also pointed out that Century Iron failed to present the Contract of
Employment or the Appointment Letter which was the best evidence that
DECISION Bañas was an inventory comptroller.

BRION, J.: The NLRC denied16 the motion for reconsideration17 that Century Iron

subsequently filed, prompting the employer company to seek relief from the
CA through a petition for certiorari under Rule 65 of the Rules of Court.18
We resolve the petition for review on certiorari1 filed by petitioners Century
Iron Works, Inc. (Century Iron) and Benito Chua to challenge the January 31,
2008 decision2 and the August 8, 2008 resolution3 of the Court of Appeals The CA Ruling
(CA) in CA-G.R. SP No. 98632.
On January 31, 2008, the CA affirmed with modification the NLRC decision.
The Factual Antecedents It agreed with the lower tribunals’ finding that Bañas was merely an inventory
clerk. It, however, ruled that Bañas was afforded due process. It held that
Bañas had been given ample opportunity to air his side during the hearing,
Respondent Eleto B. Banas worked at petitioner Century Iron beginning July pointing out that the essence of due process is simply an opportunity to be
5, 20004 until his dismissal on June 18, 2002.5 Bañas responded to his heard.19
dismissal by filing a complaint for illegal dismissal with prayer for
reinstatement and money claims.6
Century Iron filed the present petition20 after the CA denied21 its motion for
reconsideration.22
According to Century Iron, Bañas worked as an inventory comptroller whose
duties are to: (1) train newly hired warehouseman; (2) initiate analysis on the
discrepancies concerning records and inventories; (3) check and confirm The Petition
warehouseman’s report; (4) check the accuracy of materials requisition before
issuance to the respective warehouseman at the jobsite; (5) monitor and
The petitioners impute the following errors committed by the appellate court:
maintain records; and (6) recommend and initiate corrective or preventive
action as may be warranted.7
1) The CA erred in holding that the factual findings of the NLRC
may not be inquired into considering that only questions of law
Sometime in 2002, Century Iron received letters of complaint from its gas
may be brought in an original action for certiorari;
suppliers regarding alleged massive shortage of empty gas cylinders. 8 In the
investigation that Century Iron conducted in response to the letters, it found
that Bañas failed to make a report of the missing cylinders. On May 14, 2002, 2) The CA erred in finding that Bañas was not a supervisory
Century Iron required Bañas to explain within forty-eight (48) hours from employee; and
receipt of its letter why no disciplinary action should be taken against him for
loss of trust and confidence and for gross and habitual neglect of duty. 9 On
3) The CA erred in not holding that Bañas’ termination from his
May 31, 2002, Century Iron issued a Memorandum requiring Bañas to attend
employment was for valid and just causes.23
a hearing regarding the missing cylinders.10 Bañas subsequently appeared at
the hearing to air his side.
The petitioners argue that the CA erred when it did not disturb the NLRC’s
finding that Bañas was merely a rank-and-file employee. Citing Capitol
On June 17, 2002, Century Iron, through Personnel Officer Mr. Virgilio T.
Medical Center, Inc. v. Dr. Meris,24 they contend that for factual findings of
Bañaga, terminated Bañas’ services on grounds of loss of trust and
the NLRC to be accorded respect, these must be sufficiently supported by the
confidence, and habitual and gross neglect of duty.11 The termination was
evidence on record. The petitioners assert that Bañas was a supervisory
effective June 18, 2002.
employee who, in the interest of the employer, effectively recommended
managerial actions using his independent judgment. They point out that one
In his defense, Bañas alleged that he merely worked as an inventory clerk of Bañas’ duties as an inventory comptroller was to recommend and initiate
who is not responsible for the lost cylinders. He pointed out that his tasks corrective or preventive action as may be warranted.
were limited to conducting periodic and yearly inventories, and submitting his
findings to the personnel officer. He maintained that unlike a supervisory
The petitioners also maintain that Bañas was dismissed for just and valid
employee, he was not required to post a bond and he did not have the
causes. They reiterate that since Bañas was a supervisory employee, he could
authority to receive and/or release cylinders in the way that a warehouseman
be dismissed on the ground of loss of confidence. Finally, the petitioners
does. Therefore, he cannot be terminated on the ground of loss of
claim that Bañas was grossly and habitually negligent in his duty which
confidence.12
further justified his termination.

On the other hand, the petitioners asserted that Bañas was a supervisory
The Respondent’s Position
employee who was responsible for the lost cylinders. They maintained that
Bañas committed numerous infractions during his tenure amounting to gross
and habitual neglect of duty. These included absences without leave, In his Comment,25 Bañas posits that the petition raises purely questions of fact
unauthorized under time, failure to implement proper standard warehousing which a petition for review on certiorari under Rule 45 of the Rules of Courts
and housekeeping procedure, negligence in making inventories of materials, does not allow. He additionally submits that the petitioners’ arguments have
and failure to ensure sufficient supplies of oxygen-acetylene gases.13 been fully passed upon and found unmeritorious by the lower tribunals and
the CA.
The Labor Arbitration Rulings
The Issues
In a decision14 dated January 31, 2005, Labor Arbiter (LA) Joel S. Lustria
ruled that Bañas was illegally dismissed. The LA did not believe Century This case presents to us the following issues:
Iron’s assertions that Bañas worked as an inventory comptroller and that he
was grossly and habitually neglectful of his duties. The evidence on record
1) Whether or not questions of fact may be inquired into in a petition for
shows that Bañas was an inventory clerk whose duties were merely to
certiorari under Rule 65 of the Rules of Court;
conduct inventory and to submit his report to the personnel officer. As an
inventory clerk, it was not his duty to receive the missing items. The LA also
ruled that Century Iron deprived Bañas of due process because the purpose of 2) Whether or not Bañas occupied a position of trust and confidence, or was
the hearing was to investigate the lost cylinders and not to give Bañas an routinely charged with the care and custody of Century Iron’s money or
opportunity to explain his side. property; and

On appeal by Century Iron, the National Labor Relations Commission 3) Whether or not Century Iron terminated Bañas for just and valid causes.
As part of the third issue, the following questions are raised:
a) Whether or not loss of confidence is a ground for terminating a rank-and-
file employee who is not routinely charged with the care and custody of the
employer’s money or property; and
b) Whether or not Bañas was grossly and habitually neglectful of his duties.
The Court’s Ruling
We reverse the CA’s decision.
In a petition for review on certiorari under Rule 45, only questions of law
may be put into issue while in a petition for certiorari under Rule 65, only
questions of jurisdiction may be inquired into
On the first issue, the CA relied on Cebu Shipyard & Eng’g Works, Inc. v.
William Lines, Inc.26 in affirming the lower tribunals’ finding that Bañas
worked as an inventory clerk. According to the CA, this Court has ruled in
Cebu Shipyard that in petitions for certiorari, only questions of law may be
put into issue and questions of fact cannot be entertained. Not noticing such
glaring error, the petitioners agree to such disquisition.They, however, assert
that there is an exception to the rule that only questions of law may be
brought in an original action for certiorari, such as when the lower court’s
findings of facts are not supported by sufficient evidence or that the same was
based on misapprehension or erroneous appreciation of facts.27
A revisit of Cebu Shipyard shows that the CA has inadvertently misquoted
this Court. In the said case, we held:28
In petitions for review on certiorari, only questions of law may be put into
issue. Questions of fact cannot be entertained. The finding of negligence by
the Court of Appeals is a question which this Court cannot look into as it
would entail going into factual matters on which the finding of negligence
was based. [emphasis ours; italics supplied]
We clarify that the petitioners filed a petition for certiorari under Rule 65 of
the Rules of Court before the CA. Both the petitioners and the CA have
confused Rule 45 and Rule 65. In several Supreme Court cases,29 we have
clearly differentiated between a petition for review on certiorari under Rule
45 and a petition for certiorari under Rule 65. A petition for review on
certiorari under Rule 45 is an appeal from a ruling of a lower tribunal on pure
questions of law.30 It is only in exceptional circumstances 31 that we admit and
review questions of fact.
A question of law arises when there is doubt as to what the law is on a certain
state of facts, while there is a question of fact when the doubt arises as to the
truth or falsity of the alleged facts. For a question to be one of law, the
question must not involve an examination of the probative value of the
evidence presented by the litigants or any of them. The resolution of the issue
must rest solely on what the law provides on the given set of circumstances.
Once it is clear that the issue invites a review of the evidence presented, the
question posed is one of fact.32
Thus, the test of whether a question is one of law or of fact is not the
appellation given to such question by the party raising the same; rather, it is
whether the appellate court can determine the issue raised without reviewing
or evaluating the evidence, in which case, it is a question of law; otherwise it
is a question of fact.33
On the other hand, a petition for certiorari under Rule 65 is a special civil
action, an original petition confined solely to questions of jurisdiction because
a tribunal, board or officer exercising judicial or quasi-judicial functions has
acted without jurisdiction or in excess of jurisdiction or with grave abuse of
discretion amounting to lack of jurisdiction.34
The petition before us involves mixed questions of fact and law. The issues of
whether Bañas occupied a position of trust and confidence, or was routinely
charged with the care and custody of the employer’s money or property, and
whether Bañas was grossly and habitually neglectful of his duties involve
questions of fact which are necessary in determining the legal question of
whether Bañas’ termination was in accordance with Article 282 of the Labor
Code.
We will only touch these factual issues in the course of determining whether
the CA correctly ruled whether or not the NLRC committed grave abuse of
discretion in the process of deducing its conclusions from the evidence
proffered by the parties. In reviewing in this Rule 45 petition the CA’s
decision on a Rule 65 petition, we will answer the question: Did the CA
correctly determine whether the NLRC committed grave abuse of discretion
in ruling on this case?35
Bañas did not occupy a position of trust and confidence nor was he in
charge of the care and custody of Century Iron’s money or property
The CA properly affirmed the NLRC’s ruling that Bañas was a rank-and-file
employee who was not charged with the care and custody of Century Iron’s
money or property. The ruling of the CA, finding no grave abuse of discretion
in the LA and the NLRC rulings and are supported by substantial evidence, is,
to our mind, correct. The evidence on record supports the holding that Bañas
was an ordinary employee. There is no indication that the NLRC’s decision
was unfair or arbitrary. It properly relied on Century Iron’s numerous
memoranda36 where Bañas was identified as an inventory clerk. It correctly
observed that Century Iron unequivocably declared that Bañas was an
inventory clerk in its July 29, 2002 termination report with the Department of
Labor and Employment.37 Moreover, as the NLRC judiciously pointed out,
Century Iron failed to present the Contract of Employment or the
Appointment Letter, the best evidence that would show that Bañas was an
inventory comptroller.
Since Bañas was an ordinary rank- and-file employee, his termination
on the ground of loss of confidence was illegal
Since Bañas did not occupy a position of trust and confidence nor was he
routinely in charge with the care and custody of Century Iron’s money or
property, his termination on the ground of loss of confidence was misplaced.
We point out in this respect that loss of confidence applies to: (1) employees
occupying positions of trust and confidence, the managerial employees; and
(2) employees who are routinely charged with the care and custody of the
employer’s money or property which may include rank-and-file employees.
Examples of rank-and-file employees who may be dismissed for loss of
confidence are cashiers, auditors, property custodians, or those who, in the
normal routine exercise of their functions, regularly handle significant
amounts of money or property.38 Thus, the phrasing of the petitioners’ second
assignment of error is inaccurate because a rank-and-file employee who is
routinely charged with the care and custody of the employer’s money or
property may be dismissed on the ground of loss of confidence.
Bañas was grossly and habitually neglectful of his duties
With respect to Century Iron’s assertion that Bañas was grossly and habitually
neglectful of his duties, the CA erred in ruling that the NLRC did not commit
grave abuse of discretion in concluding that the dismissal was illegal. The
NLRC’s finding that there was illegal dismissal on the ground of gross and
habitual neglect of duties is not supported by the evidence on record. It
believed in Bañas’ bare and unsubstantiated denial that he was not grossly
and habitually neglectful of his duties when the record is replete with pieces
of evidence showing the contrary. Consequently, the NLRC capriciously and
whimsically exercised its judgment by failing to consider all material
evidence presented to it by the petitioners and in giving credence to Bañas’
claim which is unsupported by the evidence on record.39
Bañas’ self-serving and unsubstantiated denials cannot defeat the concrete
and overwhelming evidence submitted by the petitioners. The evidence on
record shows that Bañas committed numerous infractions in his one year and
eleven-month stay in Century Iron. On October 27, 2000, Century Iron gave
Bañas a warning for failing to check the right quantity of materials subject of
his inventory.40 On December 29, 2000, Bañas went undertime.41 On January
2, 2001, Bañas incurred an absence without asking for prior leave.42 On
August 11, 2001, he was warned for failure to implement proper warehousing
and housekeeping procedures.43 On August 21, 2001, he failed to ensure
sufficient supplies of oxygen-acetylene gases during business hours.44 On
November 15, 2001, Bañas was again warned for failing to secure prior
permission before going on leave.45 In May 2002, Century Iron’s accounting
department found out that Bañas made double and wrong entries in his
inventory.46
Article 282 of the Labor Code provides that one of the just causes for
terminating an employment is the employee’s gross and habitual neglect of
his duties. This cause includes gross inefficiency, negligence and
carelessness.47 "Gross negligence connotes want or absence of or failure to
exercise slight care or diligence, or the entire absence of care. It evinces a
thoughtless disregard of consequences without exerting any effort to avoid
them. Fraud and willful neglect of duties imply bad faith of the employee in
failing to perform his job, to the detriment of the employer and the latter’s
business. Habitual neglect, on the other hand, implies repeated failure to
perform one's duties for a period of time, depending upon the
circumstances."48

To our mind, such numerous infractions are sufficient to hold him grossly and
habitually negligent.  His repeated negligence is not tolerable. The totality of
infractions or the number of violations he committed during his employment
merits his dismissal. Moreover, gross and habitual negligence includes
unauthorized absences and tardiness,49 as well as gross inefficiency,
negligence and carelessness.50 As pronounced in Valiao v. Court of
Appeals,51 "fitness for continued employment cannot be compartmentalized
into tight little cubicles of aspects of character, conduct, and ability separate
and independent of each other."

Besides, the determination of who to keep in employment and who to dismiss

for cause is one of Century Iron's prerogatives. Time and again, we have
recognized that the employer has the right to regulate, according to its
discretion and best judgment, ell aspects of employment, including work
assignment, working methods, processes to be followed, working regulations,
transfer of employees, work supervision, lay-off of workers and the
discipline, dismissal and recall of workers.52 It would be the height of
injustice if we force an employer to retain the services of an employee who
does not value his work.

In view of all the foregoing, we find the petition meritorious.

WHEREFORE, premises considered, we hereby GRANT the petition. The

assailed decision and resolution of the Court of Appeals are REVERSED and
SET ASIDE. The complaint for illegal dismissal is DISMISSED for lack of
merit. Costs against respondent Eleto B. Bañas. SO ORDERED.
G.R. No. 185335               June 13, 2012
PRUDENTIAL GUARANTEE AND ASSURANCE EMPLOYEE
LABOR UNION and SANDY T. VALLOTA, Petitioners, vs.
NATIONAL LABOR RELATIONS COMMISSION, PRUDENTIAL
GUARANTEE AND ASSURANCE INC., and/or JOCELYN
RETIZOS, Respondents.
DECISION
MENDOZA, J.:
This is a petition for review on certiorari under Rule 45 filed by petitioners
Prudential Guarantee and Assurance Employee Labor Union (Union) and
Sandy T. Vallota (Vallota) seeking to set aside the September 16, 2008
Decision1 and November 10, 2008 Resolution2 of the Court of Appeals (CA)
in CA-G.R. SP No. 102699.
memorandum10 dated December 12, 2005, outlining his response to the
charges.
Meanwhile, the Union sent a letter11 to PGAI President Philip K.
Rico (Rico) requesting that a grievance committee be convened and that the
contents of the computers of other IT personnel be similarly produced. The
request for the convening of a grievance committee was ignored. On
December 21, 2005, Vallota was given a notice of termination of his
employment effective January 10, 2006 on the ground of loss of trust and
confidence. The decision (AC-05-02) was embodied in a
memorandum12 dated December 21, 2005.
Thus, the petitioners filed a complaint for illegal dismissal with claims for full
backwages, moral and exemplary damages, and attorney’s fees. The case was
docketed as NLRC-NCR Case No. 00-01-00387-06.
On March 31, 2006, Labor Arbiter Aliman D. Mangandog (LA) rendered a
decision13 in favor of the petitioners, the dispositive portion of which reads:

The Facts
WHEREFORE, the foregoing premises considered, judgment is hereby
rendered, declaring the dismissal of complainant Vallota illegal and holding
Vallota commenced his employment with respondent Prudential Guarantee the respondents for the following:
and Assurance, Inc. (PGAI) on May 16, 1995 as a Junior Programmer
assigned to the Electronic Data Processing (EDP) Department. He reported
1. to reinstate complainant Vallota to his former position without
directly to Gerald Dy Victory, then head of the EDP, until his replacement by
loss of benefits and seniority rights.
respondent Jocelyn Retizos (Retizos) sometime in 1997.

2. to pay complainant Vallota full backwages from the time of his

In August of 2005, Vallota was elected to the Board of Directors of the
dismissal until actual reinstatement partially computed as of this
Union.
date amount[ing] to ₱ 60,856.00 (₱ 18,400/mo. x 3 mos. & 8
days).
On November 11, 2005, PGAI’s Human Resource Manager, Atty. Joaquin R.
Rillo (Atty. Rillo), invited Union President, Mike Apostol (Apostol) to his
3. to pay complainant’s attorney’s fee equivalent to 10% of the
office. Atty. Rillo informed Apostol that PGAI was going to conduct an on-
total monetary award.
the-spot security check in the Information and Technology (IT) Department.
Atty. Rillo also requested that Union representatives witness the inspection to
which Apostol agreed. SO ORDERED.14

The inspection team proceeded to the IT Department, and the EDP head, The LA held that PGAI failed to meet its burden of evidence, and the
through PGAI network administrator Angelo Gutierrez (Gutierrez), initiated conflicting claims of the parties were resolved in favor of Vallota for failure
the spot check of IT Department computers, beginning with the one assigned of PGAI to adduce substantial evidence to support its claim. The LA further
to Vallota. After exploring the contents of all the folders and subfolders in the held that the dismissal was not commensurate to the misconduct complained
"My Documents" folder, Gutierrez apparently did not find anything unusual of, especially considering that it was Vallota’s first offense.15
with Vallota’s computer and said "Wala naman, saan dito?" Retizos insisted,
"Nandyan yan," and took over the inspection until she found a folder named
On the matter of the blank gate pass stored in Vallota’s computer, the LA
"MAA." She then exclaimed, "Heto oh! Ano to? Bakit may MAA dito?"
found as satisfactory his explanation that Joseph Tolentino (Tolentino), a
Retizos asked Vallota, "Are you working for MAA?" Vallota replied, "Hindi
PGAI employee, requested him, from time to time, to print a gate pass
po, MAA mutual life po yan na makikita po sa internet." Gutierrez saved a
whenever he had to bring tools outside of the company premises. The LA
copy of the contents of the MAA folder in a floppy disk.3
cited Vallota’s argument that "it is quite odd [that] despite the fact that the
gate pass form was admitted by the respondents in [their] Reply as their
Sensing that Vallota was being singled out, Apostol insisted that all the exclusive property, complainant’s possession of the same was not considered
computers in the IT Department, including that of Retizos, be also subjected x x x Possession of Company property without authorization."16
to a spot security check. Later, at Retizos’ office, and in the presence of Atty.
Rillo, Vallota was informed that Retizos and Atty. Rillo would print the files
The LA further found that the respondents were not able to establish that
found in his computer under the folder "MAA." Vallota did not object. After
Vallota used company property for his personal benefit. Nothing on record
the files were printed, Vallota and the Union Secretary were asked to sign
could show that he made an attempt to defraud his employer. With regard to
each page of the printout. Vallota, however, was not given a copy of the
the charge that, without authorization, he misused or removed company
printed file.
documents, the LA opined that if this were true, the respondents should have
conducted a thorough investigation to determine the liable persons.17
On November 14, 2005, Vallota received a memorandum4 directing him to
explain within 72 hours why highly confidential files were stored in his
Finally, the LA ruled that Vallota was denied due process since the
computer. The case was assigned Reference No. AC-05-02. The same
respondents refused to conduct a hearing, despite Vallota’s request, to thresh
memorandum also informed him that he was being placed under preventive
out the matters raised by him in his memoranda.18
suspension for 30 days effective upon receipt of the said notice. A second
memorandum,5 also dated November 14, 2005, notified Vallota of the
extension of his preventive suspension for another 30 days, in view of the fact The respondents filed their Memorandum of Appeal19 dated May 19, 2006.
that the management needed more time to evaluate the administrative case The case was docketed as NLRC NCR CA No. 049107-06(7).
against him.
On June 30, 2006, the National Labor Relations Commission (NLRC) issued
Vallota responded in writing on November 21, 2005. 6 Three days later, on its Resolution20 dismissing the appeal on the ground that the respondents
November 24, 2005, PGAI sent him another memorandum7 requesting further failed to submit a certificate of non-forum shopping in accordance with the
details on some of the matters he raised in his response. In a letter8 dated Rules of Procedure of the NLRC.
December 6, 2005, Vallota requested a conference, to be attended by a Union
representative and counsel. In reply, PGAI sent Vallota another
The respondents filed their Motion for Reconsideration21 dated July 17,
memorandum9 dated December 7, 2005, which, among others, set a new
2006,22 which the Union opposed.
deadline for Vallota to submit his reply and evidence in his defense.

On October 31, 2007, the NLRC granted the respondents’ motion for
In compliance with the deadline set, Vallota submitted his reply-
reconsideration and reversed and set aside the decision of the LA.23 The
dispositive portion of the resolution reads:
WHEREFORE, premises considered, respondents’ Motion for
Reconsideration from the Resolution of June 30, 2006 is GRANTED. The
appealed decision is hereby REVERSED and SET ASIDE. However,
respondent is hereby ordered to pay complainant financial assistance
equivalent to one-half (1/2) month pay for every year of service or xx the
amount of ninety two thousand pesos (₱ 92,000.00.)
10 yrs.
₱ 18,400 x = ₱ 92,000.00
2 property custodians, etc., or those who, in the normal and routine exercise of
SO ORDERED.
The NLRC reasoned out that the respondents had submitted substantial and
sufficient evidence to prove that there existed grounds for the PGAI to lose
trust and confidence in Vallota. The NLRC also found grave abuse of
discretion on the part of the LA to disregard the affidavits of Tolentino,
Retizos and Allan Unson, as the LA himself did not set a hearing for the
purpose of cross-examining the said witnesses or verifying the statements
made in their affidavits. As reflected in the decretal portion, although the
NLRC ruled that the dismissal was valid, it still directed the respondents to
grant Vallota financial assistance of one-half (1/2) month pay for every year
of his ten (10) years of service.24
The petitioners moved for a reconsideration25 of the decision, but their motion
was denied in a resolution26 dated December 28, 2007.
Dejected, the petitioners filed a petition for certiorari27 with the CA which was
docketed as CA-G.R. SP. No. 102699. On September 16, 2008, the CA
denied the petition for lack of merit, and sustained the award of the NLRC.
The petitioners’ motion for reconsideration was denied in a resolution dated
November 10, 2008.
Hence, this petition.
ISSUES
The petitioners raise the following issues:
I. WHETHER OR NOT THE HONORABLE COURT OF APPEALS
COMMITTED GRAVE ABUSE OF DISCRETION IN GIVING
LIBERALITY TO PRIVATE RESPONDENTS['] FOUR BLATANT
VIOLATIONS OF THE NLRC RULES OF PROCEDURE.
II. WHETHER OR NOT THE HONORABLE COURT OF APPEALS
GROSSLY MISAPPRECIATED THE FACT THAT NO
SUBSTANTIAL EVIDENCE EXIST[S] TO JUSTIFY THE DISMISSAL
OF PETITIONER VALLOTA. 28
RULING OF THE COURT
First, the allegation of grave abuse of discretion is misplaced, as this is an
issue appropriate for a petition for certiorari under Rule 65, not a petition for
review on certiorari under Rule 45. There is no question that grave abuse of
discretion or errors of jurisdiction may be corrected only by the special civil
action of certiorari. Such special remedy does not avail in instances of error of
judgment which can be corrected by appeal or by a petition for review.
Because the petitioners availed of the remedy under Rule 45, recourse to Rule
65 cannot be allowed either as an add-on or as a substitute for appeal.29
Regarding illegal dismissal, the core issues to be resolved here are: (1)
whether Vallota was validly dismissed on the ground of loss of trust and
confidence; and (2) whether the requirements of procedural due process for
termination were observed.
Whether the petitioner was validly dismissed on the ground of loss of trust
and confidence
The Court’s discussion in Mabeza v. National Labor Relations
Commission30 is instructive:
Loss of confidence as a just cause for dismissal was never intended to
provide employers with a blank check for terminating their employees. Such a
vague, all-encompassing pretext as loss of confidence, if unqualifiedly given
the seal of approval by this Court, could readily reduce to barren form the
words of the constitutional guarantee of security of tenure. Having this in
mind, loss of confidence should ideally apply only to cases involving
employees occupying positions of trust and confidence or to those situations
where the employee is routinely charged with the care and custody of the
employer's money or property. To the first class belong managerial
employees, i.e., those vested with the powers or prerogatives to lay down
management policies and/or to hire, transfer, suspend, lay-off, recall,
discharge, assign or discipline employees or effectively recommend such
managerial actions; and to the second class belong cashiers, auditors,
their functions, regularly handle significant amounts of money or property.
Evidently, an ordinary chambermaid who has to sign out for linen and other
hotel property from the property custodian each day and who has to account
for each and every towel or bedsheet utilized by the hotel's guests at the end
of her shift would not fall under any of these two classes of employees for
which loss of confidence, if ably supported by evidence, would normally
apply. Illustrating this distinction, this Court, in Marina Port Services, Inc. vs.
NLRC, has stated that:
To be sure, every employee must enjoy some degree of trust and confidence
from the employer as that is one reason why he was employed in the first
place. One certainly does not employ a person he distrusts. Indeed, even the
lowly janitor must enjoy that trust and confidence in some measure if only
because he is the one who opens the office in the morning and closes it at
night and in this sense is entrusted with the care or protection of the
employer's property. The keys he holds are the symbol of that trust and
confidence.
By the same token, the security guard must also be considered as enjoying the
trust and confidence of his employer, whose property he is safeguarding. Like
the janitor, he has access to this property. He too, is charged with its care and
protection.
Notably, however, and like the janitor again, he is entrusted only with
the physical task of protecting that property. The employer's trust and
confidence in him is limited to that ministerial function. He is not entrusted,
in the Labor Arbiter's words, 'with the duties of safekeeping and safeguarding
company policies, management instructions, and company secrets such as
operation devices.' He is not privy to these confidential matters, which are
shared only in the higher echelons of management. It is the persons on such
levels who, because they discharge these sensitive duties, may be considered
holding positions of trust and confidence. The security guard does not belong
in such category.
More importantly, we have repeatedly held that loss of confidence should not
be simulated in order to justify what would otherwise be, under the provisions
of law, an illegal dismissal. "It should not be used as a subterfuge for causes
which are illegal, improper and unjustified. It must be genuine, not a mere
afterthought to justify an earlier action taken in bad faith."31
(Citations omitted. Emphases supplied.)
In Bristol Myers Squibb (Phils.), Inc. v. Baban,32 the Court discussed the
requisites for a valid dismissal on the ground of loss of trust and confidence:
It is clear that Article 282(c) of the Labor Code allows an employer to
terminate the services of an employee for loss of trust and confidence. The
right of employers to dismiss employees by reason of loss of trust and
confidence is well established in jurisprudence.
The first requisite for dismissal on the ground of loss of trust and
confidence is that the employee concerned must be one holding a position of
trust and confidence. Verily, We must first determine if respondent holds such
a position.
There are two (2) classes of positions of trust. The first class consists of
managerial employees. They are defined as those vested with the powers or
prerogatives to lay down management policies and to hire, transfer suspend,
lay-off, recall, discharge, assign or discipline employees or effectively
recommend such managerial actions. The second class consists of cashiers,
auditors, property custodians, etc. They are defined as those who in the
normal and routine exercise of their functions, regularly handle significant
amounts of money or property.
xxx Philippines, a domestic corporation selling life insurance policies to the
buying public, and files relating to PGAI’s internal affairs:
The second requisite is that there must be an act that would justify the loss of
trust and confidence. Loss of trust and confidence to be a valid cause for 1. MAA Mutualife Philippines, Inc. prospectus consisting of five
dismissal must be based on a willful breach of trust and founded on clearly (5) pages
established facts. The basis for the dismissal must be clearly and convincingly
established but proof beyond reasonable doubt is not necessary.33
2. MAA Mutualife Philippines, Inc. corporate profile consisting of
six (6) pages
(Citations omitted. Emphases supplied.)
3. PGAI client’s (sic) questionnaire consisting of five (5) pages
Thus, the first question to be addressed is whether Vallota held a position of
trust and confidence. In previous cases, the following positions were
4. PGAI values and strategy
classified under the second class of holders of positions of trust and
confidence: a pharmaceutical company’s district manager employed to handle
pharmaceutical products for distribution to medical practitioners and sale to 5. PGAI Client Servising (sic): Proposed Service Standard
drug outlets,34 a bank manager,35 and an employee tasked with purchasing consisting of seven (7) pages
supplies and equipment.36 The position of a contract claims assistant tasked
with monitoring enforcement of contracts involving large sums of money was
6. PGAI Marketing Department Division consisting of twenty (20)
also classified to be analogous to this second class of holders of positions of
pages
trust and confidence.37

6.1 Marketing Department present set-up

Vallota was employed by PGAI as a Junior Programmer assigned to the EDP
Department. His functions included the following:
6.2 Present Table of Organization
38 
- Installation of PGAI System on all designated branches
6.3 How is the market evolving? How does it affect
PGAI?
- Development of internal programs as required by the
organization
6.4 The strategy of change
- Handling and maintenance of all programs as per advise.
6.5 Segmentation
- Conduct[s] operation training on PGAI systems on all PGAI
branches 6.6 Proposed Table of Organization

- Generates and handles renewal list of all applicable lines. 6.7 Proposed PGA Super Branch

- Generates and produces renewal notice of all lines as required. 6.7.a Objectives

- Generates paid premium production of all agents. 6.7.b Accounts to be service

- Generates outstanding production reports of all agents. 6.8 Proposed Chart for the Retail Division

- Generates report on top account executive per I.T. supervisor 6.8.a Dual Objective
instruction.
6.9 Marketing Administration
- Generates and handle[s] data on top agents per AE premium
production.
6.10 Analysis of Statistics

- Handles and maintains uploading system, accounting data per

advise, account receivable system, motor car policy system, claims 6.11 Proposed Corporate Accounts Servicing Division
motor car system, check disbursement system, cash call system,
R.I. outgoing and incoming system, facultative systems. 6.11.a Facts

- All other task[s] as may be assigned to him from time to time.39 6.11.b 2003 and 2004 Dealership Production Statistics

Based on the standards set by previous jurisprudence, Vallota’s position as 6.11.c 2003 -2004 Budget Analysis
Junior Programmer is analogous to the second class of positions of trust and
confidence. Though he did not physically handle money or property, he
became privy to confidential data or information by the nature of his 7. PGAI Marketing Division: An Analysis & Proposed Solution
functions. At a time when the most sensitive of information is found not consisting of seven (7) pages
printed on paper but stored on hard drives and servers, an employee who
handles or has access to data in electronic form naturally becomes the 8. PGAI Customer Service Commitment consisting of six (6)
unwilling recipient of confidential information. pages

Having addressed the nature of his position, the next question is whether the 9. PGAI Gate Pass Form40
act complained of justified the loss of trust and confidence of Vallota’s
employer so as to constitute a valid cause for dismissal. It must, thus, be
determined whether the alleged basis for dismissal was based on clearly Following such discovery, Vallota was charged with the following violations
established facts. of Company Rules on Company Property:

The act alleged to have caused the loss of trust and confidence of PGAI in 1. Possession of company property without authorization;
Vallota was the presence in his computer’s hard drive of a folder named
"MAA" allegedly containing files with information on MAA Mutual Life 2. Securing or obtaining Prudential materials or supplies
 fraudulently;
3. Using Company equipment, property, or material to perform or
create something for personal gain or purpose; and
4. Misuse or removal from company premises without proper
authorization of Prudential records or confidential information of
any nature.41
Vallota and the Union argue, among others, that (1) the respondents failed to
prove by substantial evidence that Vallota’s position did not allow him to
access confidential information and that the data found in his computer had
been used for his personal gain; (2) Vallota did not deliberately get the files
from other departments; instead, such files were acquired in the process of
fixing diskettes and printing information as requested by his co-employees;
(3) no evidence was presented to prove that Vallota sold or was about to sell
corporate documents to MAA Mutual Life Corporation or to any company;
and (4) the respondents’ refusal to convene a grievance machinery was a clear
abuse of management prerogative.42
The respondents, on the other hand, counter that Vallota admitted ownership
of the files found in his computer. They also argue that it was the Data Center
Technical Support Staff, and not the Junior Programmer, who handled
recovery/fixing/printing of files of the nature of those found in Vallota’s
possession; that it was a remote possibility that the Junior Programmer would
be directly requested to assist employees, since the Methods Analyst would
have been the designee for such task; that Vallota’s functions as Junior
Programmer did not include matters relating to web development; that under
standard IT procedure and company practice, the employees who requested
assistance from the IT Department were required to fill up a Job Request
Form (JRF), which was then submitted for prior approval by the IT Head; that
Retizos, as IT Head, could not recall signing or approving any request
pertaining to the recovered PGAI files; that Vallota could not produce a single
JRF when he was asked to do so and explained the lack of JRFs by stating
that such file repairs, file recovery, or printing jobs were merely "little favors"
and that such were considered as company "practice"; and that he, however,
refused to reveal the names of the employees who had sought assistance in the
fixing/printing/recovery of the PGAI files.43
conclusion, even if other equally reasonable minds might conceivably opine
otherwise.55 Failure of the employer to discharge the foregoing onus would
mean that the dismissal is not justified and, therefore, illegal.56
In this case, there was no other evidence presented to prove fraud in the
manner of securing or obtaining the files found in Vallota’s computer. In fact,
aside from the presence of these files in Vallota’s hard drive, there was no
other evidence to prove any gross misconduct on his part. There was no proof
either that the presence of such files was part of an attempt to defraud his
employer or to use the files for a purpose other than that for which they were
intended. If anything, the presence of the files reveals some degree of
carelessness or neglect in his failure to delete them, but it is an extremely
farfetched conclusion bordering on paranoia to state that it is part of a larger
conspiracy involving corporate espionage.
Moreover, contrary to the respondents’ allegations, the MAA files found in
Vallota’s computer, the prospectus and corporate profile, are not sensitive
corporate documents. These are documents routinely made available to the
public, and serve as means to inform the public about the company and to
disseminate information about the products it sells or the services it provides,
in order that potential clients may make a sound and informed decision
whether or not to purchase or avail of such goods and services.
If anything, the presence of the files would merely merit the development of
some suspicion on the part of the employer, but should not amount to a loss of
trust and confidence such as to justify the termination of his employment.
Such act is not of the same class, degree or gravity as the acts that have been
held to be of such character. While Vallota’s act or omission may have been
done carelessly, it falls short of the standard required for termination of
employment. It does not manifest either that the employee concerned is unfit
to continue working for his employer.
Termination of employment is a drastic measure reserved for the most serious
of offenses. When the act complained of is not so grave as to result in a
complete loss of trust and confidence, a lower penalty such as censure,
warning, or even suspension, would be more circumspect. This is of particular
significance here where during Vallota’s ten years of service to PGAI, not
once was he ever warned or reprimanded for such printing services.

The respondents aver that Vallota also had in his computer the PGAI Gate Whether the procedural due process requirements for termination were
Pass Form template,44 a company property that could not be copied, stored, or observed
reproduced without company permission. They also claim that Vallota was
guilty of using company equipment, property or material to perform or create
The petitioners allege that Vallota was denied due process of law, as the
something for personal gain or purpose. MAA files, alleged to be highly
records of the case clearly show that his request for an administrative hearing
confidential and sensitive, were found in Vallota’s computer which he
was denied without reason by PGAI. Citing Rule 1, Section 2(d) of the
explained were downloaded from the MAA website outside of company
Implementing Rules of Book VI of the Labor Code, the petitioners argue that
premises merely for information. Upon searching the MAA website, however,
a hearing or conference must be conducted to afford the employee an
they (respondents) did not find any of the said files. They also found that the
opportunity to respond to the charge, and to present or rebut evidence
MAA website was accessible only to certain users and was not open to the
presented against him. The petitioners are of the position that the unjustified
public as claimed by Vallota. Given all of these, the respondents concluded
refusal of PGAI to conduct a hearing violated the said provision of the Rules
that Vallota’s possession of the PGAI and MAA files appeared to be part of a
implementing the Labor Code, as well as Vallota’s right to defend himself
plan to take advantage of the said documents for personal gain.45
before an impartial investigating body.57

While the law and this Court recognize the right of an employer to dismiss an
The Court explained the concept of the opportunity to be heard in the case
employee based on loss of trust and confidence, the evidence of the employer
of Perez v. Philippine Telegraph and Telephone Company:58
must clearly and convincingly establish the facts upon which the loss of trust
and confidence in the employee is based.46
After receiving the first notice apprising him of the charges against him, the
employee may submit a written explanation (which may be in the form of a
To be a valid ground for dismissal, loss of trust and confidence must be based
letter, memorandum, affidavit or position paper) and offer evidence in support
on a willful breach of trust and founded on clearly established facts. A breach
thereof, like relevant company records (such as his 201 file and daily time
is willful if it is done intentionally, knowingly and purposely, without
records) and the sworn statements of his witnesses. For this purpose, he may
justifiable excuse, as distinguished from an act done carelessly, thoughtlessly,
prepare his explanation personally or with the assistance of a representative or
heedlessly or inadvertently.47 It must rest on substantial grounds and not on
counsel. He may also ask the employer to provide him copy of records
the employer’s arbitrariness, whims, caprices or suspicion; otherwise, the
material to his defense.  His written explanation may also include a request
employee would remain eternally at the mercy of the employer. 48 Further, in
that a formal hearing or conference be held. In such a case, the conduct of a
order to constitute a just cause for dismissal, the act complained of must be
formal hearing or conference becomes mandatory, just as it is where there
work-related and show that the employee concerned is unfit to continue
exist substantial evidentiary disputes59 or where company rules or practice
working for the employer.49 Such ground for dismissal has never been
requires an actual hearing as part of employment pretermination
intended to afford an occasion for abuse because of its subjective nature.50
procedure. To this extent, we refine the decisions we have rendered so far on
this point of law.
It must also be remembered that in illegal dismissal cases like the one at
bench, the burden of proof is upon the employer to show that the employee’s
This interpretation of Section 2(d), Rule I of the Implementing Rules of Book
termination from service is for a just and valid cause.51 The employer’s case
VI of the Labor Code reasonably implements the "ample opportunity to be
succeeds or fails on the strength of its evidence and not the weakness of that
heard" standard under Article 277(b) of the Labor Code without unduly
adduced by the employee,52 in keeping with the principle that the scales of
restricting the language of the law or excessively burdening the employer.
justice should be tilted in favor of the latter in case of doubt in the evidence
This not only respects the power vested in the Secretary of Labor and
presented by them.53 Often described as more than a mere scintilla, 54 the
Employment to promulgate rules and regulations that will lay down the
quantum of proof is substantial evidence which is understood as such relevant
guidelines for the implementation of Article 277(b). More importantly, this is
evidence as a reasonable mind might accept as adequate to support a
faithful to the mandate of Article 4 of the Labor Code that "[a]ll doubts in the
implementation and interpretation of the provisions of [the Labor Code],
including its implementing rules and regulations shall be resolved in favor of
labor."
In sum, 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 rules and regulations.
(Emphasis original. Underscoring supplied.)60
Under the doctrine of strained relations, the payment of separation pay is
considered an acceptable alternative to reinstatement when the latter option is
no longer desirable or viable. On one hand, such payment liberates the
employee from what could be a highly oppressive work environment. On the
other hand, it releases the employer from the grossly unpalatable obligation of
maintaining in its employ a worker it could no longer trust.64
(Emphasis, underscoring and comments in the original.)
This has been the consistent ruling in the award of separation pay to illegally
dismissed employees in lieu of reinstatement, in addition to the award of
backwages.
Finally, Vallota, having been compelled to litigate in order to seek redress, is
entitled, as he had prayed early on, to the award of attorney’s fees equivalent
to 10% of the total monetary award.
WHEREFORE, the petition is GRANTED. The September 16, 2008
Decision and November 10, 2008 Resolution of the Court of Appeals in CA-
G.R. SP No. 102699 are REVERSED and SET ASIDE, and the Decision of
the Labor Arbiter dated March 31, 2006
is REINSTATED but MODIFIED to the effect that, in addition to
backwages, petitioner Sandy T. Vallota is entitled to be awarded separation
pay equivalent to one (1) month salary for every year of service in lieu of
reinstatement.

In this case, the two-notice requirement was complied with. By the

SO ORDERED.
petitioners’ own admission, PGAI issued to Vallota a written Notice of
Charges & Preventive Suspension (Ref. No. AC-05-02) dated November 14,
2005. After an exchange of memoranda, PGAI then informed Vallota of his
dismissal in its decision dated December 21, 2005.

Given, however, that the petitioners expressly requested a conference or a

convening of a grievance committee, following the Court’s ruling in
the Perez case, which was later cited in the recent case of Lopez v. Alturas
Group of Companies,61 such formal hearing became mandatory. After PGAI
failed to affirmatively respond to such request, it follows that the hearing
requirement was not complied with and, therefore, Vallota was denied his
right to procedural due process.

In light of the above discussion, Vallota is entitled to reinstatement and

backwages, reckoned from the date he was illegally dismissed until the
finality of this decision in accordance with jurisprudence.62

In view of the strained relations between Vallota and PGAI, however, it is not
in the best interest of the parties, nor is it advisable or practical to order
reinstatement. Where reinstatement is no longer viable as an option,
separation pay equivalent to one (1) month salary for every year of service
should be awarded as an alternative. It must be stressed, however, that an
illegally dismissed employee is entitled to two reliefs: backwages and
reinstatement, which are separate and distinct. In Golden Ace Builders v.
Tagle,63 it was written:

Thus, an illegally dismissed employee is entitled to two reliefs: backwages

and reinstatement. The two reliefs provided are separate and distinct. In
instances where reinstatement is no longer feasible because of strained
relations between the employee and the employer, separation pay is granted.
In effect, an illegally dismissed employee is entitled to either reinstatement, if
viable, or separation pay if reinstatement is no longer viable, and backwages.

The normal consequences of respondents’ illegal dismissal, then, are

reinstatement without loss of seniority rights, and payment of backwages
computed from the time compensation was withheld up to the date of
actual reinstatement. Where reinstatement is no longer viable as an
option, separation pay equivalent to one (1) month salary for every year
of service should be awarded as an alternative. The payment of
separation pay is in addition to payment of backwages. (emphasis, italics
and underscoring supplied)

Velasco v. National Labor Relations Commission, emphasizes:

The accepted doctrine is that separation pay may avail in lieu  of

reinstatement if reinstatement is no longer practical or in the best
interest of the parties. Separation pay in lieu of reinstatement may likewise
be awarded if the employee decides not to be reinstated. (Emphasis in the
original; italics supplied)
G.R. No. 198699               October 9, 2013 himself;

REXIE A. HORMILLOSA, Petitioner, vs. 3. Hormillosa also issued a temporary credit sale (TCS) and COL
COCA-COLA BOTTLERS PHILS., INC., represented by its Iloilo Plant in the name of Arnold Store but used the outlet number of Virgie
Human Resource Head, ROBERTO RICHARD H. DOLAR, Respondent. Bucaes (Bucaes) who happened to be not one of Coca-Cola’s
authorized credit outlets. Bucaes acknowledged that she received
50cases but her understanding was that when she received the
DECISION
cases, they were part of her market development program product
assistance; and
MENDOZA, J.:
4. Mrs. Cecilia Palmes (Palmes) denied her indebtedness and
Through this pet1t1on for review on certiorari under Rule 45 or the Rules of complained that her signature was forged as shown in the invoice.
Court, petitioner Rexie A. Hormillosa (Hormillosa) assails the April 29, 2011
Decision1 and the September 5, 2011 Resolution2 of the Court of Appeals
On March 15, 1999, Tiosayco issued another memorandum 9 directing
(CA), in CA G.R. SP No. 05062, which nullified and set aside the October 26,
Hormillosa to report on March 17, 1999 for a question-and-answer
2009 Decision3 and the January 15, 2010 Resolution4 or the National Labor
investigation relative to the findings. Hormillosa, however, asked for a
Relations Commission (NLRC). The dispositive portion or the questioned CA
deferment which request was granted.
decision reads:

On March 16, 1999, Hormillosa was issued another memorandum10 directing

WHEREFORE, premises considered, the petition is hereby GRANTED and
him again to report on March 19, 1999. It contained a warning that failure on
the Decision and Resolution of public respondent (insofar as to the
his part to appear on the said date would be deemed a waiver of his right to be
pronouncements relating to private respondent only) which were respectively
heard and his case would be submitted for resolution based on the evidence of
promulgated on 26 October 2009 and15 January 2010 relative to NLRC Case
CBPI. Hormillosa again moved for the postponement of the investigation.
No. V-000528-00(AE-05-09) [SRAB Case No. VI-05050210-99] are
NULLIFIED and SETASIDE. In their stead, a new one is entered declaring
private respondent’s dismissal from his employment as valid. On March 17, 1999, Tiosayco issued another memorandum giving Hormillosa
until March 20, 1999 to submit his written explanation on his alleged
violations but the latter did not heed it. Instead, he sent Tiosayco a
SO ORDERED.5
letter11 informing him that the investigation was already "moot and academic"
on the pretense that he had already filed a case against CBPI for Unfair Labor
The facts Practice (ULP).

On November 1, 1996, Hormillosa was employed as a route salesman by
Coca-Cola Bottlers Phils., Inc. (CBPI). His duties included, among others,
selling CBPI’s soft drink products, either on cash or on credit basis; receiving
payments from proceeds of the sale or payments of past due or current
accounts; issuing sales invoices; and receiving empty bottles and cases of soft
drinks (empties).
Concerning the sales invoices, he was authorized to issue them on a cash and
credit basis. He prepared the invoices stating the names of the customers, the
quantity and kind of merchandise purchased, and the corresponding amounts.
He was required to make the customers sign the invoices, especially in cases
they were on credit basis, and leave copies with them. The invoices were then
submitted to the Finance Department for accounting and auditing.
On March 22, 1999, Tiosayco submitted his findings and recommendations to
the Regional Sales Manager, proposing the termination of Hormillosa. CBPI
gave credence to the report and approved his recommendation. Subsequently,
a termination letter12 was issued informing Hormillosa that he was being
terminated effective March 29, 1999. The letter reads:
Dear Mr. Hormillosa,
This is to inform you that effective March 29, 1999, you are hereby
terminated from employment with Coca-Cola Bottlers Philippines, Inc.
The grounds for your termination among others are as follows:

Due to their delicate position, route salesmen, like Hormillosa, were given a 1. Issuance of fictitious and falsified COL invoices particularly to
handbook entitled, CCBPI Employee Code of Disciplinary Rules and named outlets or customers namely Shirley Jardeleza, Cecilia
Regulations. This set of rules and regulations served as their guide in the Palmes, Feby Panerio, and Virgie Bañares
performance of their duties. Hormillosa received his copy.6
2. Misappropriation of Company Funds
Sometime in the early part of 1999, the then CBPI District Sales Supervisor,
Raul S. Tiosayco III (Tiosayco), conducted a verification and audit of the
3. Violation of Company Rules and Regulations
accounts handled by Hormillosa. He discovered transactions in violation of
CCBPI Employee Code of Disciplinary Rules and Regulations, specifically
"Fictitious sales transactions; Falsification of company 4. Loss of Trust and Confidence
records/data/documents/invoices/reports; fictitious issuances of
TCS/COL(Temporary Credit Sales/Container on Loan); non-issuance or mis-
The decision to terminate you came up after a thorough investigation against
issuance of invoices and receipts as well as commercial documents to dealers;
you.
forgery; misuse, abuse or defalcation of funds form market development
program."7 On March 8, 1999, Tiosayco issued a memorandum to Hormillosa
informing him that he was being placed on grounded status and would be Please be guided accordingly.
subjected to an investigation.
In addition to his termination, CBPI also filed several criminal cases against
On March 11, 1999, Tiosayco informed the Regional Sales Manager of the him citing his fraudulent acts.
initial results of his verification and audit, through an inter-office
memorandum,8 which detailed the following findings:
Even after terminating Hormillosa, Tiosayco uncovered more anomalies
committed by him. He found out that Hormillosa tampered a sales invoice
1. As reflected in an invoice, Shirley Jardeleza (Jardeleza) had an issued to Aurelia and Cedy Tafida (Tafida Store) by placing an amount
outstanding container on loan (COL). Upon verification, however, different from that which he had submitted to the Finance Department.
this account was denied by Jardeleza. According to her, they
would always buy in cash and this statement was substantiated by
an attached affidavit signed by her; Another anomaly committed by Hormillosa was against one Winnie Pajarillo
(Pajarillo) who purchased soft drinks and deposited an amount representing
the empties. It was agreed that the deposit would be refunded to Pajarillo
2. Mrs. Feby Panerio, who was previously served by Hormillosa, upon the return of the empties. When Pajarillo returned the empties and asked
denied her indebtedness as reflected in her COL account. Mrs. for a refund, he only made a partial payment.
Panerio admitted that she was personally requested by Hormillosa
to sign the COL issuance with the promise that he would settle it
On May 24, 1999, Hormillosa filed a complaint for ULP (harassment due to
union activities and union busting), Illegal Dismissal, Illegal Deduction,
Illegal Grounding, Non-payment of Commission, Non-payment of 13th
Month pay, Violation of CBA, Damages, and Attorney’s Fees against CBPI
before the Sub-Regional Arbitration Branch No. VI (SRAB). Thereafter, a
preliminary conference was conducted and both parties were directed to file
their respective position papers.
Hormillosa averred in his position paper that prior to his dismissal, he was a
member of the Board of Directors of CBPI’s employees union and he became
its secretary on March 7, 1999. As secretary, he sent a copy of the new list of
union officers to the management with a warning that if CBPI would not stop
harassing the members of the union, it would declare a strike.
He further alleged that on March 8, 1999, he was immediately placed on
grounded status by Tiosayco supposedly on the basis of some anomalous
transactions conducted by him per verification and audit. He claimed
however, that the verification and audit were contrary to Section 2(d), Article
III of the Collective Bargaining Agreement (CBA) which provides: "The
Company shall coordinate with the Union authorized representative to witness
the account verification that the company will conduct with respect to
questionable accounts issued to Company customers by route salesman or
relief salesmen under investigation." He likewise alleged that as part of the
design to destroy the union, CBPI discriminated against the officers until they
were pressured to resign.
On April 28, 2000, Labor Arbiter Rodolfo G. Lagoc (LA Lagoc) dismissed
Hormillosa’s complaint for illegal dismissal, ruling that his termination was
proper. According to LA Lagoc, the provision cited by Hormillosa, as a
violation of the CBA, was only a portion and was taken out of context. It
explained that Hormillosa was just using the union to thwart management’s
exercise of its legal prerogative. LA Lagoc, however, awarded Hormillosa a
separation pay, citing the case of Magos v. NLRC,13 where it was stated that
separation pay could be granted as a form of equitable relief even if the
dismissal was for a just cause. Thus, he ordered CBPI to pay Hormillosa a
separation pay equivalent to one-half (1/2) month salary for every year of
service, that is, ₱9,037.50 (₱6,025.00 salary per month divided by 2 then
multiplied by 3 years).
On appeal, the NLRC, on January 17, 2002, ordered the remand of the case to
the SRAB to give Hormillosa the opportunity to confront the witnesses and
evidence against him. Moreover, it stated that Section 5(b), Rule V of the
1990 NLRC Rules was not observed. The said section provides:
If the Labor Arbiter finds no necessity of further hearing after the parties have
submitted their position papers and supporting documents, he shall issue an
Order to that effect and shall inform the parties, stating the reason therefor. x
x x.
The NLRC explained that the above rule was mandatory because of the word
"shall." It found that the LA failed to issue the said order despite the fact that
he found no necessity of holding a trial on the merits and that the case would
be resolved on the basis of the pleadings. The absence of this order deprived
Hormillosa, who could have opted for a trial, his right to due process. Even
though the discretion whether to hold a trial was with the LA, the rule should
have been observed.
On December 24, 2008, the SRAB, this time through LA Danilo Acosta (LA
Acosta),
ruled that Hormillosa was illegally dismissed but did not order his
reinstatement due to strained relations. It was decreed that he was entitled to
backwages from the date of his dismissal up to December 24,2008 plus a
separation pay equivalent to one month pay for every year of service with a
fraction of six months being considered one whole month. It likewise
awarded attorney’s fees equivalent to 10% of the total award which reached
₱1,257,590.11, broken down as follows:
Backwages ……………………....₱1,070,963.83
Separation Pay………………..…….₱72,300.0010%
Attorney’s Fees……………...₱114,326.38
Total……………………………...₱1,257,590.11
LA Acosta explained that because the witnesses of CBPI did not appear in the
hearings as ordered, it had no other alternative but to give Hormillosa the
"benefit of the doubt" and decide the case in his favor.
Aggrieved, CBPI appealed to the NLRC, arguing that the decision of LA
Acosta was bereft of factual findings, applicable laws and legal principles. It
insisted that the dismissal of Hormillosa was proper considering that the
charges against him were proven by substantial evidence.
On October 30, 2009, the NLRC upheld the decision of LA Acosta, reasoning
out that they found no substantial evidence that Hormillosa falsified and
issued fictitious invoices and CBPI failed to "unleash the burden of proof" 14 to
justify his termination. Regarding CBPI’s total liability, the NLRC, however,
arrived at a different figure. Its computation was as follows:
Backwages: 3/29/1999 – 9/30/2009
₱6,025.00 x 126 months = ₱759,150.00
+
Separation Pay: 11/1996 – 9/30/2009
₱6,025.00 x 13 years = ₱78,325.00
₱837,475.00
10% Attorney’s Fees: x .10
₱83,747.50
₱837,475.00 + 83,747.50 = ₱921,222.50
CBPI moved for reconsideration but its motion was denied.
Finding the NLRC decision still unacceptable, CBPI elevated the matter to
the CA via a petition for certiorari under Rule 65.
On April 29, 2011, the CA nullified and set aside the NLRC decision and held
that the dismissal of Hormillosa was valid. According to the CA, the NLRC
ignored the fact that the decision of LA Acosta did not conform to Section 14,
Rule V of the 2005 Revised Rules of Procedure of the NLRC, which reads:
SECTION 14. Contents of Decisions. – The decisions and orders of the Labor
Arbiter shall be clear and concise and shall include a brief statement of the: a)
facts of the case; b) issues involved; c) applicable laws or rules; d)
conclusions and the reasons therefor; and e) specific remedy or relief granted.
In cases involving monetary awards, the decision or orders of the Labor
Arbiter shall contain the amount awarded.
The CA stated that the NLRC decision did not contain a recital of the facts of
the case, applicable laws or rules and the conclusions and reasons therefor. It
did not relate how the case started, what the case was all about, and while the
decision concluded that Hormillosa had been illegally dismissed, it did not
contain any explanation as to why and how the dismissal became invalid or
illegal. LA Acosta stated that the case was decided in favor of Hormillosa
based on "benefit of the doubt," but no law, jurisprudence or facts were
supplied to justify his conclusion. The CA considered that it was in
contravention of Section 14, Article VIII of the1987 Constitution which states
that no decision shall be rendered by any court without expressing therein
clearly and distinctly the facts and the law on which it was based.
Moreover, the CA observed, the NLRC whimsically exercised its judgment
when it disregarded the evidence of CBPI, which substantially proved the
valid dismissal of Hormillosa. According to the CA, Hormillosa was validly
dismissed under Article 282 (c) of Labor Code, as amended. It states that loss
of confidence applies to cases involving employees who occupy positions of
trust and confidence or to those situations where the employee is routinely
charged with the care and custody of the employer’s money or property. 15 The
CA pointed out that there were established circumstances proving such breach
of trust and confidence. Thus:
In the extant case, private respondent’s breach of the trust reposed on him by
petitioner is duly proven. The verification and audit conducted by Tiosayco
on the accounts handled by private respondent revealed some anomalous from work.
transactions which certainly erode the trust and confidence reposed on him by
petitioner. Even when the transactions uncovered by Tiosayco were obviously
Regarding the CA pronouncement that the NLRC decision did not contain the
questionable, private respondent did not bother to explain them. On the
facts of the case, applicable laws or rules and the conclusions and reasons
contrary, he skirted the question and answer investigation and filed a
therefor, Hormillosa argues that the decision of LA Acosta substantially
complaint against petitioner instead with the SRAB No. VI.
complied with the requirements of the NLRC Rules of Procedure. He explains
that the NLRC had the occasion to exhaustively goover the records of the case
This act of private respondent only reinforced petitioner’s distrust and and so it cannot be said that it arbitrarily affirmed the decision of LA Acosta.
apprehension on private respondent’s conduct in handling his accounts. The
question and answer investigation would have been the right forum for private
Hormillosa also opines that the remand of the case to the LA was precisely
respondent to explain the accounts he handled, disprove the initial findings of
for the purpose of giving him the opportunity to confront the witnesses and
anomalous transactions uncovered by Tiosayco, and clear his name in the
evidence against him. He pointed out that because those who attended the
process. Regrettably, private respondent carelessly ignored the opportunity.
hearing (Palmes and Panerio) denied their signatures and the rest of the
witnesses (Pajarillo and Jardeleza) did not appear, LA Acosta had no recourse
Public respondent anchored its Decision on the denial of Cecilia Palmes and but to disregard any evidence bearing their signatures. It was for those reasons
Feby Panerio of their signatures in the affidavits presented by petitioner and that LA Acosta gave the "benefit of the doubt" in favor of Hormillosa and
the affidavit of Virgie Bucaes (Bucaes) which stated that she denied the such was in accord with Article 4 of the Labor Code, to wit:
signatures of Sales Invoices Nos.79872 E and 79873 E because she knew they
were the signatures of Arnold Segaya, owner of Arnold Store; she allowed
Art. 4. Construction in Favor of Labor. - All doubts in the implementation and
Arnold Store to use her account so that when her stock is fully consumed, she
interpretation of the provisions of this Code, including its implementing rules
can buy from Arnold Store; and she never signed an affidavit before Hector
and regulations shall be resolved in favor of labor.
Teodosio, a notary public.

CBPI counters that Hormillosa failed to show that the CA committed any
While Cecilia Palmes and Feby Panerio denied that the signatures appearing
reversible error when it rendered the April 29, 2011 Decision. Such failure is
in their supposed affidavits were theirs, the other evidence presented by
fatal because it is the burden of every party seeking review of any decision of
petitioner were not rebutted by private respondent. Although these evidence
the CA or other lower tribunal to persuade this Court not only of the existence
were not testified to, they are still deemed admissible and worthy of
of questions of law fairly and logically arising there from, which he must
evidentiary value. "Indeed, hearings and resolutions of labor disputes are not
distinctly set forth in his petition for review, but also that those questions are
governed by the strict and technical rules of evidence and procedure observed
substantial enough to merit consideration, or that there are special and
in the regular courts of law. Technical rules of procedure are not applicable in
important reasons warranting the review he seeks.17
labor cases, but may apply only by analogy or in a suppletory character, for
instance, when there is a need to attain substantial justice and an expeditious,
practical and convenient solution to a labor problem." CBPI also stresses that, although Palmes and Panerio denied that the
signatures appearing in their supposed affidavits were theirs, the other
evidence it presented were not rebutted by Hormillosa. Specifically, he did
It is undisputed in the present case that private respondent issued sales
not refute the evidence regarding the tampering of a sales invoice and its
invoices to Arnold Store using the account number of Bucaes. Private
duplicate copy that revealed different amounts when supposedly they should
respondent was in bad faith when he booked this account because he made it
bear the same. He did not explain either why the amount deposited by
appear that the account was for Bucaes. Even if Bucaes consented to this
Pajarillo for the empties was not refunded to him when said empties were
transaction, private respondent was aware that this was a prohibited practice.
already returned.
Also undisputed is the fact that Shirley Jardeleza (Jardeleza) categorically
denied that she signed the sales invoice purportedly stating that she had an
obligation with petitioner in the amount of ₱810.00. Although the challenged Hormillosa, on the other hand, asserts that he had refuted all the evidence
Decision stated that private respondent was able to explain that it was the presented by CBPI against him, citing the denial by Palmes and Panerio of
helper of Jardeleza who signed the sales invoice, there was no showing that their purported signatures. He also explains that he was not able to confront
Jardeleza authorized the same. the other witnesses for CBPI because they failed to appear during the
scheduled hearings.
Private respondent likewise did not refute the evidence presented by
petitioner regarding the tampering of a sales invoice (Invoice No. 101193) With respect to the tampering of a sales invoice issued to Tafida Store and the
issued to Tadifa Store. The sales invoice and its duplicate copy revealed delayed refund of the deposit on empties to Pajarillo, he claims that those
different amounts when supposedly they should bear the same. He also did were not brought to his attention and were not mentioned in the termination
not explain why the amount deposited by Pajarillo for the empties was not letter sent to him.
refunded back to the latter when the empties were already returned. As
agreed, private respondent should have already made the refund once the
Ruling of the Court
empties were returned. However, private respondent delayed the refund and
even paid for it only partially. This is seriously dubious. Paying partially only
indicated that private respondent appropriated the deposit for himself in Article 282 of the Labor Code enumerates the just causes for the termination
violation of petitioner’s code of conduct. of employment of an employee by the employer, to wit:

In sum, these proofs, taken collectively, are more than enough to constitute
willful breach by private respondent of the trust reposed on him by petitioner.
They undoubtedly create a reasonable ground for petitioner to believe that
private respondent could not longer be trusted. Hence, the latter is validly
dismissed from his employment. Without finding of illegal dismissal, the
monetary awards bestowed on him by the SRAB No. VI and modified by
public respondent have no basis.16
Art. 282. Termination by employer. – An employee 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 representative in connection
with his work;

Not in conformity, Hormillosa elevated his complaint to this Court via Rule
45 of the Rules of Court, questioning the following:
1. The finding of the Court of Appeals that the NLRC committed
grave abuse of discretion in affirming the decision of SRAB No.
VI despite the alleged fact that the latter did not conform to the
guidelines set forth in the2005 Revised Rules of Procedure of the
NLRC; and
(b) Gross and habitual neglect by the employee of his duties;
(c) Fraud or willful breach by the employee of the trust reposed in
him by his employer or duly authorized representative;
(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; and

2. The finding of the Court of Appeals that the NLRC whimsically (e) Other causes analogous to the foregoing.
exercised its judgment when it disregarded the evidence of Coca-
Cola which substantially proved the valid dismissal of Hormillosa
The rule is that, in labor cases, substantial evidence or such relevant evidence
as a reasonable mind might accept as sufficient to support a conclusion is
required.18 The CA was correct when it ruled that Hormillosa’s employment
was validly terminated under paragraph (c) of the above provision. There was
substantial evidence to justify his dismissal.
In Bristol Myers Squibb (Phils.), Inc. v. Baban,19 the Court discussed the
requisites for a valid dismissal on the ground of loss of trust and confidence
as follows:
It is clear that Article 282(c) of the Labor Code allows an employer to
terminate the services of an employee for loss of trust and confidence. The
right of employers to dismiss employees by reason of loss of trust and
confidence is well established in jurisprudence.
The first requisite for dismissal on the ground of loss of trust and confidence
is that the employee concerned must be one holding a position of trust and
confidence. Verily, We must first determine if respondent holds such a
position.
There are two (2) classes of positions of trust. The first class consists of
managerial employees. They are defined as those vested with the powers or
prerogatives to lay down management policies and to hire, transfer suspend,
lay-off, recall, discharge, assign or discipline employees or effectively
recommend such managerial actions. The second class consists of cashiers,
auditors, property custodians, etc. They are defined as those who in the
normal and routine exercise of their functions, regularly handle significant
amounts of money or property.
xxxx
The second requisite is that there must be an act that would justify the loss of
trust and confidence. Loss of trust and confidence to be a valid cause for
dismissal must be based on a willful breach of trust and founded on clearly
established facts. The basis for the dismissal must be clearly and convincingly
established but proof beyond reasonable doubt is not necessary.20
Hormillosa, being a route salesman, falls under the second class. By selling
soft drink products and collecting payments for the same, he was considered
an employee who regularly handled significant amounts of money and
property in the normal and routine exercise of his functions. The nature of the
position of a route salesman was described in Coca Cola Bottlers, Phils. V.
Kapisanan ng Malayang Manggagawa sa Coca-Cola-FFW and Florention
Ramirez,21 where it was written:
We agree that route salesmen are likely individualistic personnel who roam
around selling softdrinks, deal with customers and are entrusted with large
asset and funds and property of the employer. There is a high degree of trust
and confidence reposed on them, and when confidence is breached, the
employer may take proper disciplinary action on them. The work of a
salesman exposes him to voluminous financial transactions involving his
employer’s goods. The life of the soft drinks company depends not so much
on the bottling or production of the product since this is primarily done by
automatic machines and personnel who are easily supervised but upon mobile
and far-ranging salesmen who go from store to store all over the country or
region. Salesmen are highly individualistic personnel who have to be trusted
and left essentially on their own. A high degree of confidence is reposed on
them because they are entrusted with funds or properties of their employer.
Clearly, Hormillosa occupies a position of trust. As correctly pointed out by
the CA, there was a high degree of trust and confidence reposed on him and
when this confidence was breached, the employer was justified in taking the
appropriate disciplinary action.
With regard to the second requisite for dismissal on the ground of loss of trust
and confidence, the Court finds that Hormillosa committed acts which
warranted his dismissal from employment.
Although the case was remanded to the SRAB, it was not for the purpose of
conducting a new trial or hearing, but for Hormillosa to confront the
witnesses against him and refute the evidence on record against him. The
remand order did not vacate the earlier hearings and the evidence earlier
adduced by both parties.
Except for the affidavits of Cecilia Palmes, Fely Paneiro and Shirley
Jardeleza, the evidence against him remained in the records, particularly the
documents and invoices he submitted to CBPI. The falsified invoices
remained unexplained by him.
Hormillosa cannot deny that fact that he issued sales invoices to Arnold Store,
a store unregistered or unaccredited with CBPI. He transacted with the said
store using the account of Virgie Bucaes, proprietor of Virgie’s Eatery.
Bucaes, who had an outlet profile with CBPI, was assigned with Control No.
0027069.22 Hormillosa extended credit to Arnold Store, an unknown customer
to CBPI, as documented by two credit sales invoices, Invoice Nos. 79872 and
79873, amounting to ₱5,600.00 and ₱4,806.00respectively. By doing so, he
gave a false and misleading representation that the account was that of
Bucaes. CBPI had a set of rules and regulations, one of which was that only
those outlets, which had outlet control, were entitled to enjoy credit from
CBPI. Salesmen were not allowed to extend credit to those who had no outlet
numbers or outlet profiles from CBPI. Evidently, Hormillosa disregarded and
disobeyed the company rules.
As earlier stated, the evidence in this regard was supplied by Hormillosa
himself when he submitted copies of the sales invoices. For this reason, the
stipulation under Section 2(d), Article III of the CBA, which provides that the
company shall coordinate with the Union’s authorized representative to
witness the account verification that the company would conduct with respect
to questionable accounts issued to Company customers by route salesman or
relief salesmen under investigation, is not applicable.
In Tiu and/or Conti Pawnshop v. National Labor Relations Commission, 23 the
Court ruled that the language of Article 282(c) of the Labor Code requires
that the loss of trust and confidence must be based on willful breach of the
trust reposed in the employee by the employer. Ordinary breach will not
suffice; it must be willful. Such breach is willful if it is done intentionally,
knowingly, and purposely, without justifiable excuse as distinguished from an
act done carelessly, thoughtlessly, heedlessly, or inadvertently.
In the case at bench, Hormillosa's act of issuing sales invoices to Arnold Store
could not have been performed without intent and knowledge on his part as
such act could not have been done without planning or merely through
negligence. Hence, the breach was willful.
Indeed, the tampering of the sales invoice and the matter of the empties which
Hormillosa claimed were never brought to his attention nor mentioned in his
termination letter, were discovered after he had already been terminated.
CBPI, however, raised them as an issue in its position paper 24 to prove that he
could no longer be trusted. Hormillosa should have addressed these issues. At
any rate, considering that he had already been dismissed, CBPI no longer
conducted another hearing. It can only be surmised that CBPI mentioned the
newly discovered anomalies to bolster its position that he could not be trusted.
Nevertheless, as pointed out earlier, the tampering of the invoices were clear
enough.
Worth mentioning is the fact that Hormillosa did not deal with his employer
in good faith. The records show that when Tiosayco, on March 17,1999,
directed Hormillosa to submit his written explanation on March 20,1999, he
sent instead a letter stating that the investigation would be moot and academic
because he had already filed a case against the company for ULP. As can be
gleaned from the records, he filed a complaint against CBPI only on March
24, 1999, negating his earlier statement that he had supposedly filed a case
before Tiosayco sent the memorandum.
As keenly noted by the CA, Hormillosa’s act of "filing a complaint" to skirt
the question-and-answer investigation only reinforced CBPI’s apprehension
on his conduct in handling his accounts and eroded its trust and confidence in
him. The said investigation would have been the right forum for him to
explain the accounts he mishandled and disprove the findings of the
verification and audit team. Instead, he passed up the opportunity to clear his
name by refusing to submit himself to the investigation and explain the
anomalies discovered.
Regarding the issue of separation pay, the case of Central Philippines Bandag
Retreaders, Inc. vs. Prudencio J. Diasnes25 is instructive:
The award of separation pay is authorized in the situations dealt with in
Article 283 and Art. 284 of the Labor Code, but not in terminations of
employment based on instances enumerated in Art. 282.
"The only cases when separation pay shall be paid, although the employee
was lawfully dismissed, are when the cause of termination was not
attributable to the employee's fault but due to: (I) the installation of labor
saving devices, (2) redundancy, (3) retrenchment, (4) cessation of employer's
business, or (5) when the employee is suffering from a disease and his
continued employment is prohibited by law or is prejudicial to his health and
to the health of his co-employees (Articles 283 and 284, Labor Code.) Other
than these cases, an employee who is dismissed for a just and lawful cause is
not entitled to separation pay even if the award were to be called by another
name."26

In the case at bench, the cause for the dismissal from employment of
Hormillosa clearly falls under Article 282 of the Labor Code. Therefore, he is
not entitled to any separation pay.

WHEREFORE, the petition is DENIED.

SO ORDERED.