13. Manila Pavilion Hotel vs. Delada, G.R. No.

189947, January 25, 2012

FACTS
 Delada was the Union President of the Manila Pavilion Supervisors Association at MPH. He was
originally assigned as Head Waiter of Rotisserie, a fine-dining restaurant operated by petitioner.
Pursuant to a supervisory personnel reorganization program, MPH reassigned him as Head Waiter of
Seasons Coffee Shop, another restaurant operated by petitioner at the same hotel.
 Respondent declined the inter-outlet transfer and instead asked for a grievance meeting on the
matter, pursuant to their Collective Bargaining Agreement (CBA). He also requested his retention as
Head Waiter of Rotisserie while the grievance procedure was ongoing.
 MPH replied and told respondent to report to his new assignment for the time being, without
prejudice to the resolution of the grievance involving the transfer. He adamantly refused to assume his
new post at the Seasons Coffee Shop and instead continued to report to his previous assignment.
 Thus, MPH sent him several memoranda on various dates, requiring him to explain in writing why he
should not be penalized for the following offenses:
 serious misconduct;
 willful disobedience of the lawful orders of the employer;
 gross insubordination;
 gross and habitual neglect of duties; and
 willful breach of trust.
 Meanwhile, the parties failed to reach a settlement. Consequently, Delada lodged a Complaint before
the National Conciliation and Mediation Board.
 While respondents Complaint concerning the validity of his transfer was pending before the Panel of
Voluntary Arbitrators (PVA), MPH continued with the disciplinary action against him for his refusal to
report to his new post at Seasons Coffee Shop.
 The PVA issued a Decision and ruled that the transfer of Delada was a valid exercise of management
prerogative. The PVA thus pronounced that Delada had no valid and justifiable reason to refuse or
even to delay compliance with the managements directive.
 The CA affirmed the Decision of the PVA and denied petitioners Motion for Reconsideration. Hence,
this appeal.
ISSUE: (1) WON MPH retained the authority to continue with the administrative case against Delada for
insubordination and willful disobedience of the transfer order. (2) Whether MPH is liable to pay back
wages.
RULING
(1) Yes. CA Decision modified.
Petitioner argues that it did not lose its authority to discipline Delada notwithstanding the joint
submission to the PVA of the issue of the validity of the transfer order. According to petitioner, the
specific issue of whether respondent could be held liable for his refusal to assume the new assignment
was not raised before the PVA, and that the panels ruling was limited to the validity of the transfer
order. Thus, petitioner maintains that it cannot be deemed to have surrendered its authority to
impose the penalty of suspension.
In the present case the PVA did not make a ruling on the specific issue of insubordination and
willful disobedience of the transfer order. The PVA merely said that its disagreement with the 90-day
penalty of suspension stemmed from the fact that the penalty went beyond the 30-day limit for
preventive suspension.
First, it must be pointed out that the basis of the 30-day preventive suspension imposed on Delada
was different from that of the 90-day penalty of suspension. The 30-day preventive suspension was
imposed by MPH on the assertion that Delada might sabotage hotel operations if preventive
suspension would not be imposed on him. On the other hand, the penalty of 90-day suspension was
imposed on respondent as a form of disciplinary action. It was the outcome of the administrative
proceedings conducted against him. Preventive suspension is a disciplinary measure resorted to by the
employer pending investigation of an alleged malfeasance or misfeasance committed by an
employee. The employer temporarily bars the employee from working if his continued employment
poses a serious and imminent threat to the life or property of the employer or of his co-workers.  On
the other hand, the penalty of suspension refers to the disciplinary action imposed on the employee
after an official investigation or administrative hearing is conducted. The employer exercises its right
to discipline erring employees pursuant to company rules and regulations. Thus, a finding of validity of
the penalty of 90-day suspension will not embrace the issue of the validity of the 30-day preventive
suspension. In any event, petitioner no longer assails the ruling of the CA on the illegality of the 30-day
preventive suspension.
It can be seen that, unlike in Sime Darby Pilipinas and Ludo & Luym Corporation, the PVA herein
did not make a definitive ruling on the merits of the validity of the 90-day suspension. The panel only
held that MPH lost its jurisdiction to impose disciplinary action on respondent. Accordingly, we rule in
this case that MPH did not lose its authority to discipline respondent for his continued refusal to report
to his new assignment.
The refusal to obey a valid transfer order constitutes willful disobedience of a lawful order of an
employer. Employees may object to, negotiate and seek redress against employers for rules or orders
that they regard as unjust or illegal. However, until and unless these rules or orders are declared
illegal or improper by competent authority, the employees ignore or disobey them at their peril. For
Galanida’s continued refusal to obey Allied Bank's transfer orders, we hold that the bank dismissed
Galanida for just cause in accordance with Article 282(a) of the Labor Code. Galanida is thus not
entitled to reinstatement or to separation pay.
(2) MPH had the authority to continue with the administrative proceedings for insubordination
and willful disobedience against Delada and to impose on him the penalty of suspension. As a
consequence, petitioner is not liable to pay back wages and other benefits for the period
corresponding to the penalty of 90-day suspension.