CATHERINE DELA CRUZ-CAGAMPAN vs ONE NETWORK BANK

June 22, 2022

J. Leonen
(J. Bondoc Digests)

DOCTRINE: An employer's blanket policy of "no-spouse employment" is

discriminatory. To justify its enforcement, the employer must clearly establish a
reasonable necessity.

FACTS:
Catherine was hired by One Network Bank (the Bank) on June 11, 2004 as an
Accounting Specialist. Subsequently, the Bank implemented the "Exogamy
Policy" on May 1, 2006. This policy provided that when two employees of the
Bank are subsequently married, one of the spouses must terminate employment
immediately after marriage, except as to employees who were already married
prior to the rule.

However, on October 31, 2009 (around 3 years after the Exogamy Policy took
effect), Catherine married her co-worker, Angelo, a Loan Specialist. Aware of the
Exogamy Policy, the couple requested for permission from the Bank President to
allow them both to continue working for the Bank, proposing that Angelo be
simply transferred to any other branch of the Bank. However, the request was
denied.

Catherine sought reconsideration, arguing the ff:

(1) she was employed prior to the rule's effectivity;
(2) the Exogamy Policy violates Art. 136 of the Labor Code.

The request being unheeded, Catherine file for Illegal Dismissal.

The Labor Arbiter (LA) ruled in Catherine's favor, and was affirmed by the NLRC,
but the Court of Appeals (CA) reversed the decision of the NLRC, holding that
the policy was a valid exercise of management prerogative because the bank
presented a "reasonable business necessity" or a "bona fide occupational
qualification" behind the Exogamy Policy, citing the high degree of diligence the
law imposes upon banking institutions.

ISSUE: Whether the Exogamy Policy is valid.

HELD:
No.
The Supreme Court (SC) held that the policy was invalid for violating
(1) the Full Protection to Labor clause of the Constitution; and
(2) the Magna Carta for Women's provisions to eliminate discrimination against
women and their right to freely choose their spouses; and
(3) Article 136 of the Labor Coded.

As correctly held by the NLRC, the Bank's policy was unreasonable considering
that the "mere fear of the possibility that the spouses may divulge to each other
information with respect to clients' accounts" is speculative un founded, and
imaginary. Thus, the Bank failed to prove the "legitimate business concerns"
behind the assailed policy.

Note that Art. 136 of the Labor Code was also violated because Catherine was
terminated, while Angelo was retained.

The SC cited the Star Paper v Simbol case, where the doctrine of BFOQ (Bona
Fide Occupational Qualification) was enunciated, whereby employers are only
allowed to enforce no-spouse employment policies if there exists reasonable
demands of the business which require the enforcement of such a policy.

BFOQ has two requisites:

(1) that the employment qualification is reasonably related to the essential
operation of the job involved;
(2) that there is a factual basis for believing that all or substantially all persons
meeting the qualification would be unable to properly perform the duties of the
job.

Further, the case of Duncan and PT&T held that the requirement of
reasonableness must be clearly established, and that the employer bears the
burned of proof, with substantial evidence.

As a final note, Justice Leonen reminds that Friends, Lovers, and Couples share
secrets. Any bank employee may potentially craft elaborate schemes to
embezzle the bank's funds. Thus, the no-spouse employment policy cannot be
justified.