Abbott Laboratories, Et Al. v. Alcaraz, G.R. No. 192571, July 23, 2013

G.R. No. 192571. July 23, 2013.
ABBOTT LABORATORIES, PHILIPPINES, CECILLE A.

TERRIBLE, EDWIN D. FEIST, MARIA OLIVIA T. YABUTMISA,
TERESITA C. BERNARDO, AND ALLAN G. ALMAZAR,
petitioners, vs. PEARLIE ANN F. ALCARAZ, respondent.
Remedial Law; Civil Procedure; Forum Shopping; Certification

Against Forum Shopping; The prohibition against forum shopping is
different from a violation of the certification requirement under Section 5,
Rule 7 of the Rules of Court.—At the outset, it is noteworthy to mention that
the prohibition against forum shopping is different from a violation of the
certification requirement under Section 5, Rule 7 of the Rules of Court. In
Sps. Ong v. CA, 384 SCRA 139
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* EN BANC.
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Abbott Laboratories, Philippines vs. Alcaraz
(2002), the Court explained that: x x x The distinction between the

prohibition against forum shopping and the certification requirement should
by now be too elementary to be misunderstood. To reiterate, compliance
with the certification against forum shopping is separate from and
independent of the avoidance of the act of forum shopping itself. There is a
difference in the treatment between failure to comply with the certification
requirement and violation of the prohibition against forum shopping not
only in terms of imposable sanctions but also in the manner of enforcing
them. The former constitutes sufficient cause for the dismissal without
prejudice [to the filing] of the complaint or initiatory pleading upon motion
and after hearing, while the latter is a ground for summary dismissal thereof
and for direct contempt.
Same; Same; Same; Forum shopping takes place when a litigant files
multiple suits involving the same parties, either simultaneously or
successively, to secure a favorable judgment.—Forum shopping takes place
when a litigant files multiple suits involving the same parties, either
simultaneously or successively, to secure a favorable judgment. It exists
where the elements of litis pendentia are present, namely: (a) identity of
parties, or at least such parties who represent the same interests in both
actions; (b) identity of rights asserted and relief prayed for, the relief being
founded on the same facts; and (c) the identity with respect to the two
preceding particulars in the two (2) cases is such that any judgment that may
be rendered in the pending case, regardless of which party is successful,
would amount to res judicata in the other case.
Same; Same; Same; Section 5(b), Rule 7 of the Rules of Court requires
that a plaintiff who files a case should provide a complete statement of the
present status of any pending case if the latter involves the same issues as
the one that was filed.—Section 5(b), Rule 7 of the Rules of Court requires
that a plaintiff who files a case should provide a complete statement of the
present status of any pending case if the latter involves the same issues as
the one that was filed. If there is no such similar pending case, Section 5(a)
of the same rule provides that the plaintiff is obliged to declare under oath
that to the best of his knowledge, no such other action or claim is pending.
Labor Law; Probationary Employees; A probationary employee, like a
regular employee, enjoys security of tenure. However, in cases of
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684 SUPREME COURT REPORTS ANNOTATED
probationary employment, aside from just or authorized causes of

termination, an additional ground is provided under Article 295 of the
Labor Code, i.e., the probationary employee may also be terminated for
failure to qualify as a regular employee in accordance with the reasonable
standards made known by the employer to the employee at the time of the
engagement.—A probationary employee, like a regular employee, enjoys
security of tenure. However, in cases of probationary employment, aside
from just or authorized causes of termination, an additional ground is
provided under Article 295 of the Labor Code, i.e., the probationary
employee may also be terminated for failure to qualify as a regular
employee in accordance with the reasonable standards made known by the
employer to the employee at the time of the engagement. Thus, the services
of an employee who has been engaged on probationary basis may be
terminated for any of the following: (a) a just or (b) an authorized cause;
and (c) when he fails to qualify as a regular employee in accordance with
reasonable standards prescribed by the employer.
Same; Same; If the employer fails to inform the probationary employee
of the reasonable standards upon which the regularization would be based
on at the time of the engagement, then the said employee shall be deemed a
regular employee.—Section 6(d), Rule I, Book VI of the Implementing
Rules of the Labor Code provides that if the employer fails to inform the
probationary employee of the reasonable standards upon which the
regularization would be based on at the time of the engagement, then the
said employee shall be deemed a regular employee, viz.: (d) In all cases of
probationary employment, the employer shall make known to the employee
the standards under which he will qualify as a regular employee at the time
of his engagement. Where no standards are made known to the employee at
that time, he shall be deemed a regular employee. In other words, the
employer is made to comply with two (2) requirements when dealing with a
probationary employee: first, the employer must communicate the
regularization standards to the probationary employee; and second, the
employer must make such communication at the time of the probationary
employee’s engagement. If the employer fails to comply with either, the
employee is deemed as a regular and not a probationary employee.
Same; Same; An employer is deemed to have made known the
standards that would qualify a probationary employee to be a regular
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employee when it has exerted reasonable efforts to apprise the employee of

what he is expected to do or accomplish during the trial period of probation.
—An employer is deemed to have made known the standards that would
qualify a probationary employee to be a regular employee when it has
exerted reasonable efforts to apprise the employee of what he is expected to
do or accomplish during the trial period of probation. This goes without
saying that the employee is sufficiently made aware of his probationary
status as well as the length of time of the probation. The exception to the
foregoing is when the job is self-descriptive in nature, for instance, in the
case of maids, cooks, drivers, or messengers. Also, in Aberdeen Court, Inc.
v. Agustin, 456 SCRA 32 (2005), it has been held that the rule on notifying a
probationary employee of the standards of regularization should not be used
to exculpate an employee who acts in a manner contrary to basic knowledge
and common sense in regard to which there is no need to spell out a policy
or standard to be met. In the same light, an employee’s failure to perform
the duties and responsibilities which have been clearly made known to him
constitutes a justifiable basis for a probationary employee’s
nonregularization.
Same; Same; Basic knowledge and common sense dictate that the
adequate performance of one’s duties is, by and of itself, an inherent and
implied standard for a probationary employee to be regularized; such is a
regularization standard which need not be literally spelled out or mapped
into technical indicators in every case.—Verily, basic knowledge and
common sense dictate that the adequate performance of one’s duties is, by
and of itself, an inherent and implied standard for a probationary employee
to be regularized; such is a regularization standard which need not be
literally spelled out or mapped into technical indicators in every case. In this
regard, it must be observed that the assessment of adequate duty
performance is in the nature of a management prerogative which when
reasonably exercised — as Abbott did in this case — should be respected.
This is especially true of a managerial employee like Alcaraz who was
tasked with the vital responsibility of handling the personnel and important
matters of her department.
Same; Same; If the termination is brought about by the failure of an
employee to meet the standards of the employer in case of probationary
employment, it shall be sufficient that a written notice is served the
employee, within a reasonable time from the effective date
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of termination.—A different procedure is applied when terminating a

probationary employee; the usual two-notice rule does not govern. Section
2, Rule I, Book VI of the Implementing Rules of the Labor Code states that
“[i]f the termination is brought about by the x x x failure of an employee to
meet the standards of the employer in case of probationary employment, it
shall be sufficient that a written notice is served the employee, within a
reasonable time from the effective date of termination.”
Same; Company Policy; A company policy partakes of the nature of an
implied contract between the employer and employee.— A company policy
partakes of the nature of an implied contract between the employer and
employee. In Parts Depot, Inc. v. Beiswenger, 170 S.W.3d 354 (Ky. 2005), it
has been held that: [E]mployer statements of policy . . . can give rise to
contractual rights in employees without evidence that the parties mutually
agreed that the policy statements would create contractual rights in the
employee, and, hence, although the statement of policy is signed by neither
party, can be unilaterally amended by the employer without notice to the
employee, and contains no reference to a specific employee, his job
description or compensation, and although no reference was made to the
policy statement in pre-employment interviews and the employee does not
learn of its existence until after his hiring. Toussaint, 292 N.W.2d at 892.
The principle is akin to estoppel. Once an employer establishes an express
personnel policy and the employee continues to work while the policy
remains in effect, the policy is deemed an implied contract for so long as
it remains in effect. If the employer unilaterally changes the policy, the
terms of the implied contract are also thereby changed.
Same; Termination of Employment; Nominal Damages; Case law has
settled that an employer who terminates an employee for a valid cause but
does so through invalid procedure is liable to pay the latter nominal
damages.—Case law has settled that an employer who terminates an
employee for a valid cause but does so through invalid procedure is liable to
pay the latter nominal damages. In Agabon v. NLRC (Agabon), 442 SCRA
573 (2004), the Court pronounced that where the dismissal is for a just
cause, the lack of statutory due process should not nullify the dismissal, or
render it illegal, or ineffectual. However, the employer should indemnify the
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employee for the violation of his statutory rights. Thus, in Agabon, the
employer was ordered to pay the employee nominal damages in the amount
of P30,000.00.
Same; Same; If the dismissal is based on a just cause under Article 282
of the Labor Code (now Article 296) but the employer failed to comply with
the notice requirement, the sanction to be imposed upon him should be
tempered because the dismissal process was, in effect, initiated by an act
imputable to the employee; if the dismissal is based on an authorized cause
under Article 283 (now Article 297) but the employer failed to comply with
the notice requirement, the sanction should be stiffer because the dismissal
process was initiated by the employer’s exercise of his management
prerogative.—It was explained that if the dismissal is based on a just cause
under Article 282 of the Labor Code (now Article 296) but the employer
failed to comply with the notice requirement, the sanction to be imposed
upon him should be tempered because the dismissal process was, in effect,
initiated by an act imputable to the employee; if the dismissal is based on an
authorized cause under Article 283 (now Article 297) but the employer
failed to comply with the notice requirement, the sanction should be stiffer
because the dismissal process was initiated by the employer’s exercise of his
management prerogative. Hence, in Jaka, where the employee was
dismissed for an authorized cause of retrenchment — as contradistinguished
from the employee in Agabon who was dismissed for a just cause of neglect
of duty — the Court ordered the employer to pay the employee nominal
damages at the higher amount of P50,000.00.
Corporation Law; Liability of Corporate Directors; Requisites to Hold
Corporate Directors, Trustees or Officers Personally Liable for Corporate
Acts.—It is hornbook principle that personal liability of corporate directors,
trustees or officers attaches only when: (a) they assent to a patently unlawful
act of the corporation, or when they are guilty of bad faith or gross
negligence in directing its affairs, or when there is a conflict of interest
resulting in damages to the corporation, its stockholders or other persons;
(b) they consent to the issuance of watered down stocks or when, having
knowledge of such issuance, do not forthwith file with the corporate
secretary their written objection; (c) they agree to hold themselves
personally and solidarily liable with the corporation; or (d) they are made by
specific provision of law personally answerable for their corporate action.
688

Civil Law; Bad Faith; It is a well-settled rule that bad faith cannot be
presumed and he who alleges bad faith has the onus of proving it.—A
judicious perusal of the records show that other than her unfounded
assertions on the matter, there is no evidence to support the fact that the
individual petitioners herein, in their capacity as Abbott’s officers and
employees, acted in bad faith or were motivated by ill will in terminating
Alcaraz’s services. The fact that Alcaraz was made to resign and not allowed
to enter the workplace does not necessarily indicate bad faith on Abbott’s
part since a sufficient ground existed for the latter to actually proceed with
her termination. On the alleged loss of her personal belongings, records are
bereft of any showing that the same could be attributed to Abbott or any of
its officers. It is a well-settled rule that bad faith cannot be presumed and he
who alleges bad faith has the onus of proving it. All told, since Alcaraz
failed to prove any malicious act on the part of Abbott or any of its officers,
the Court finds the award of moral or exemplary damages unwarranted.
BRION, J., Dissenting Opinion:
Labor Law; Appeals; View that a labor case finds its way into the
judicial system from the National Labor Relations Commission (NLRC)
whose decision is final and executory; When an administrative ruling (or
any ruling for that matter) is already final and unappealable, the only
recourse open under the Rules of Court is through a limited review on
jurisdictional grounds under Rule 65.—A labor case finds its way into the
judicial system from the NLRC whose decision is final and executory.
Finality simply means that the NLRC ruling is no longer appealable; the
legal intent is to confine adjudication of labor cases to labor tribunals with
the expertise in these cases and thereby bring the resolution of the case to a
close at the soonest possible time. When an administrative ruling (or any
ruling for that matter) is already final and unappealable, the only recourse
open under the Rules of Court is through a limited review on jurisdictional
grounds under Rule 65. This has been the mode of review followed since
the Labor Code took effect in November 1974; labor cases were directly
brought to this Court but only on jurisdictional grounds under Rule 65.
Same; Same; View that under Section 65 of the Rules of Court, the sole
ground or issue allowed is jurisdictional — the presence or
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absence of grave abuse of discretion on the part of the National Labor

Relations Commission (NLRC) in ruling on the case; whereas, a Rule 45
review the Supreme Court simply determines whether the legal correctness
of the Court of Appeal’s finding that the NLRC ruling of illegal dismissal
had basis in fact and in law.—Under the Rule 65 review by the CA,
Montoya reiterates that the sole ground or issue allowed is jurisdictional –
the presence or absence of grave abuse of discretion on the part of the
NLRC in ruling on the case. To state the obvious, this kind of review would
have made it easier for the CA to handle the case; in the absence of a grave
abuse of discretion, it can dismiss labor cases for lack of grave abuse of
discretion as we do in this Court. From the CA, further recourse is through a
Rule 45 review by this Court on questions of law in accordance with
prevailing rulings. The office of a petition for review on certiorari is not to
examine and settle factual questions already ruled upon below. In this
review, the Court simply determines whether the legal correctness of the
CA’s finding that the NLRC ruling of illegal dismissal had basis in fact
and in law.
Same; Probationary Employees; View that while the respondent might
have been hired as a probationary employee, the petitioner’s evidence did
not establish the employers’ compliance with the probationary employment
requirements under Article 281 of the Labor Code (as amended) and Section
6(d) of the Implementing Rules of Book VI, Rule I of the Labor Code (as
amended). Thus, the respondent should be considered a regular employee
and the case should be reviewed on this basis.—While the respondent might
have been hired as a probationary employee, the petitioners’ evidence did
not establish the employers’ compliance with the probationary
employment requirements under Article 281 of the Labor Code (as
amended) and Section 6(d) of the Implementing Rules of Book VI, Rule I
of the Labor Code (as amended). Thus, the respondent should be
considered a regular employee and the case should be reviewed on this
basis. Article 281 of the Labor Code, as amended, provides: ART. 281.
Probationary employment.—Probationary employment shall not exceed six
(6) months from the date the employee started working, unless it is covered
by an apprenticeship agreement stipulating a longer period. The services of
an employee who has been engaged on a probationary basis may be
terminated for a just cause or when he fails to qualify as a regular employee
in accordance with reasonable standards made known
690
by the employer to the employee at the time of his engagement. An

employee who is allowed to work after a probationary period shall be
considered a regular employee. [italics supplied; emphasis ours] Further,
Section 6(d) of the Implementing Rules of Book VI, Rule I of the Labor
Code, as amended, states: Sec. 6. Probationary employment.—There is
probationary employment where the employee, upon his engagement, is
made to undergo a trial period during which the employer determines his
fitness to qualify for regular employment, based on reasonable standards
made known to him at the time of engagement. [emphasis supplied]
Same; Same; View that a valid probationary employment requires the
concurrence of two requirements; Failing in one or both, the employee, even
if initially hired as a probationary employee, should be viewed and
considered a regular employee.—A valid probationary employment requires
the concurrence of two requirements. First, the employer shall make known
the reasonable standard (performance standard) whose compliance will
render the employee qualified to be a regular employee. Second, the
employer shall inform the employee of the applicable performance
standard at the time of his/her engagement. Failing in one or both, the
employee, even if initially hired as a probationary employee, should be
viewed and considered a regular employee. The ponencia apparently fully
agrees with the above statement of the applicable law as it substantially
recites the same requirements, including the consequence that upon failure
to comply with these same requirements, “the employee is deemed as a
regular and not a probationary employee.” It continues, however, with a
twist that effectively negates what it has stated and admitted about the need
to communicate the regularization standards to the employee.
Same; Termination of Employment; View that to justify the dismissal of
an employee, the employer carries the burden of proving that the dismissal
was for a just cause and with the observance of due process prior to
dismissal.—To justify the dismissal of an employee, the employer carries
the burden of proving that the dismissal was for a just cause and with the
observance of due process prior to dismissal. The employer has to discharge
this burden by clear, accurate, consistent and convincing evidence; in case
of doubt, the presumption in the employee’s favor under Article 4 of the
Labor Code should apply.
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Same; Same; View that a probationary employee does not have lesser
rights than a regular employee under the Labor Code in terms of the just
cause for the termination of an employment.—An important legal point that
should not be lost in considering this case is that a probationary employee
does not have lesser rights than a regular employee under the Labor
Code in terms of the just cause for the termination of an employment.
While the strict application of Article 282 of the Labor Code may be relaxed
because the employee is still under probation (so that analogous
probationary status rules may apply), the same essential just cause for
dismissal must be present and must be proven. In other words, probationary
employment does not mean that the employee is under an “employment at
will” situation as that phrase is understood in American jurisprudence. To
reiterate, the fact that the respondent was still in her probationary period of
employment did not lessen the burden of proof that the law imposed on the
petitioners to prove the just cause for her dismissal. Probationary employees
are protected by the security of tenure provision of the Constitution and they
cannot be removed from their position except only for cause.
PETITION for review on certiorari of the decision and resolution of

the Court of Appeals.
The facts are stated in the opinion of the Court.
Laguesma, Magsalin, Consulta & Gastardo for petitioner.
Jimenez, Baroque and Salazar for respondent.
PERLAS-BERNABE, J.:
Assailed in this petition for review on certiorari1 are the
Decision2 dated December 10, 2009 and Resolution3 dated June 9,
2010 of the Court of Appeals (CA) in CA-G.R. SP No.
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1 Rollo (G.R. No. 192571), pp. 14-58.
2 Id., at pp. 1040-1054. Penned by Associate Justice Isaias Dicdican, with
Associate Justices Remedios A. Salazar-Fernando and Romeo F. Barza, concurring.
3 Id., at pp. 1139-1140.
692

101045 which pronounced that the National Labor Relations

Commission (NLRC) did not gravely abuse its discretion when it
ruled that respondent Pearlie Ann F. Alcaraz (Alcaraz) was illegally
dismissed from her employment.
The Facts
On June 27, 2004, petitioner Abbott Laboratories, Philippines
(Abbott) caused the publication in a major broadsheet newspaper of
its need for a Medical and Regulatory Affairs Manager (Regulatory
Affairs Manager) who would: (a) be responsible for drug safety
surveillance operations, staffing, and budget; (b) lead the
development and implementation of standard operating
procedures/policies for drug safety surveillance and vigilance; and
(c) act as the primary interface with internal and external customers
regarding safety operations and queries.4 Alcaraz — who was then a
Regulatory Affairs and Information Manager at Aventis Pasteur
Philippines, Incorporated (another pharmaceutical company like
Abbott) — showed interest and submitted her application on
October 4, 2004.5
On December 7, 2004, Abbott formally offered Alcaraz the
abovementioned position which was an item under the company’s
Hospira Affiliate Local Surveillance Unit (ALSU) department.6 In
Abbott’s offer sheet,7 it was stated that Alcaraz
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4 Id., at p. 74.
5 Id., at pp. 75-76.
6 Id., at pp. 51-52. Based on Abbott’s organizational structure, the Regulatory
Affairs Manager was under the umbrella of Hospira ALSU, a sub-department in
Abbott’s Hospital Care Division. ALSU serves as a transition body of Hospira, Inc., a
corporation based in the United States of America, while it is in the process of
organization in the Philippines. Abbott intended to cede the qualified employees
under ALSU to Hospira once the latter obtained its own legal personality to engage in
business in the Philippines.
7 Id., at pp. 165-168. Abbott sent Alcaraz an initial offer sheet on December 1,
2004. The compensation contained therein was re-
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was to be employed on a probationary basis.8 Later that day, she

accepted the said offer and received an electronic mail (e-mail) from
Abbott’s Recruitment Officer, petitioner Teresita C. Bernardo
(Bernardo), confirming the same. Attached to Bernardo’s e-mail
were Abbott’s organizational chart and a job description of Alcaraz’s
work.9
On February 12, 2005, Alcaraz signed an employment contract
which stated, inter alia, that she was to be placed on probation for a
period of six (6) months beginning February 15, 2005 to August 14,
2005. The said contract was also signed by Abbott’s General
Manager, petitioner Edwin Feist (Feist):10
PROBATIONARY EMPLOYMENT
Dear Pearl,
After having successfully passed the pre-employment requirements,
you are hereby appointed as follows:
Position Title : Regulatory Affairs
Manager
Department : Hospira
The terms of your employment are:
Nature of Employment : Probationary
Effectivity : February 15, 2005 to
August 14, 2005
Basic Salary : P110,000.00/ month
It is understood that you agree to abide by all existing policies, rules
and regulations of the company, as well as those, which may be
hereinafter promulgated.
_______________
negotiated and thus, the increased offer as per the offer sheet dated December 7, 2004.
8 Id., at pp. 167-168.
9 Id., at pp. 127, 169-172.
10 Id., at p. 174.
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Unless renewed, probationary appointment expires on the date
indicated subject to earlier termination by the Company for any
justifiable reason.
If you agree to the terms and conditions of your employment, please
signify your conformity below and return a copy to HRD.
Welcome to Abbott!
Very truly yours,
Sgd.
EDWIN D. FEIST
General Manager
CONFORME:
Sgd.
PEARLIE ANN FERRER-
ALCARAZ
During Alcaraz’s pre-employment orientation, petitioner Allan

G. Almazar (Almazar), Hospira’s Country Transition Manager,
briefed her on her duties and responsibilities as Regulatory Affairs
Manager, stating that: (a) she will handle the staff of Hospira ALSU
and will directly report to Almazar on matters regarding Hopira’s
local operations, operational budget, and performance evaluation of
the Hospira ALSU Staff who are on probationary status; (b) she
must implement Abbott’s Code of Good Corporate Conduct (Code
of Conduct), office policies on human resources and finance, and
ensure that Abbott will hire people who are fit in the organizational
discipline; (c) petitioner Kelly Walsh (Walsh), Manager of the
Literature Drug Surveillance Drug Safety of Hospira, will be her
immediate supervisor; (d) she should always coordinate with
Abbott’s human resource officers in the management and discipline
of the staff; (e) Hospira ALSU will spin off from Abbott in early
2006 and will be officially incorporated and known as Hospira,
Philippines. In the interim, Hospira ALSU operations will still be
under Abbott’s management, excluding the technical aspects of the
operations which is under the
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control and supervision of Walsh; and (f) the processing of

information and/or raw material data subject of Hospira ALSU
operations will be strictly confined and controlled under the
computer system and network being maintained and operated from
the United States. For this purpose, all those involved in Hospira
ALSU are required to use two identification cards: one, to identify
them as Abbott’s employees and another, to identify them as Hospira
employees.11
On March 3, 2005, petitioner Maria Olivia T. Yabut-Misa (Misa),
Abbott’s Human Resources (HR) Director, sent Alcaraz an e-mail
which contained an explanation of the procedure for evaluating the
performance of probationary employees and further indicated that
Abbott had only one evaluation system for all of its employees.
Alcaraz was also given copies of Abbott’s Code of Conduct and
Probationary Performance Standards and Evaluation (PPSE) and
Performance Excellence Orientation Modules (Performance
Modules) which she had to apply in line with her task of evaluating
the Hospira ALSU staff.12
Abbott’s PPSE procedure mandates that the job performance of a
probationary employee should be formally reviewed and discussed
with the employee at least twice: first on the third month and second
on the fifth month from the date of employment. The necessary
Performance Improvement Plan should also be made during the
third-month review in case of a gap between the employee’s
performance and the standards set. These performance standards
should be discussed in detail with the employee within the first two
(2) weeks on the job. It was equally required that a signed copy of
the PPSE form must be submitted to Abbott’s Human Resources
Department (HRD) and shall serve as documentation of the
employee’s performance during his/her probationary period.
_______________
11 Id., at pp. 127-128.
12 Id., at pp. 1042-1043.
696

This shall form the basis for recommending the confirmation or

termination of the probationary employment.13
During the course of her employment, Alcaraz noticed that some
of the staff had disciplinary problems. Thus, she would reprimand
them for their unprofessional behavior such as non-observance of
the dress code, moonlighting, and disrespect of Abbott officers.
However, Alcaraz’s method of management was considered by
Walsh to be “too strict.”14 Alcaraz approached Misa to discuss these
concerns and was told to “lie low” and let Walsh handle the matter.
Misa even assured her that Abbott’s HRD would support her in all
her management decisions.15
On April 12, 2005, Alcaraz received an e-mail from Misa
requesting immediate action on the staff’s performance evaluation as
their probationary periods were about to end. This Alcaraz
eventually submitted.16
On April 20, 2005, Alcaraz had a meeting with petitioner Cecille
Terrible (Terrible), Abbott’s former HR Director, to discuss certain
issues regarding staff performance standards. In the course thereof,
Alcaraz accidentally saw a printed copy of an e-mail sent by Walsh
to some staff members which essentially contained queries regarding
the former’s job performance. Alcaraz asked if Walsh’s action was
the normal process of evaluation. Terrible said that it was not.17
On May 16, 2005, Alcaraz was called to a meeting with Walsh
and Terrible where she was informed that she failed to meet the
regularization standards for the position of Regulatory Affairs
Manager.18 Thereafter, Walsh and Terrible requested Alcaraz to
tender her resignation, else they be forced
_______________
13 Id.
14 Id., at p. 1044.
15 Id.
16 Id.
17 Id., at pp. 1044-1045.
18 Id., at p. 1045.
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to terminate her services. She was also told that, regardless of her
choice, she should no longer report for work and was asked to
surrender her office identification cards. She requested to be given
one week to decide on the same, but to no avail.19
On May 17, 2005, Alcaraz told her administrative assistant,
Claude Gonzales (Gonzales), that she would be on leave for that day.
However, Gonzales told her that Walsh and Terrible already
announced to the whole Hospira ALSU staff that Alcaraz already
resigned due to health reasons.20
On May 23, 2005, Walsh, Almazar, and Bernardo personally
handed to Alcaraz a letter stating that her services had been
terminated effective May 19, 2005.21 The letter detailed the reasons
for Alcaraz’s termination — particularly, that Alcaraz: (a) did not
manage her time effectively; (b) failed to gain the trust of her staff
and to build an effective rapport with them; (c) failed to train her
staff effectively; and (d) was not able to obtain the knowledge and
ability to make sound judgments on case processing and article
review which were necessary for the proper performance of her
duties.22 On May 27, 2005, Alcaraz received another copy of the
said termination letter via registered mail.23
Alcaraz felt that she was unjustly terminated from her
employment and thus, filed a complaint for illegal dismissal and
damages against Abbott and its officers, namely, Misa, Bernardo,
Almazar, Walsh, Terrible, and Feist.24 She claimed that she should
have already been considered as a regular and not a probationary
employee given Abbott’s failure to
_______________
19 Id.
20 Id., at p. 1046.
21 Id., at p. 1047.
22 Id., at pp. 19-21, 78, and 80-81.
23 Id., at p. 1047.
24 Id., at p. 255. See Labor Arbiter (LA) Decision dated March 30, 2006.
698

inform her of the reasonable standards for her regularization upon

her engagement as required under Article 29525 of the Labor Code.
In this relation, she contended that while her employment contract
stated that she was to be engaged on a probationary status, the same
did not indicate the standards on which her regularization would be
based.26 She further averred that the individual petitioners
maliciously connived to illegally dismiss her when: (a) they
threatened her with termination; (b) she was ordered not to enter
company premises even if she was still an employee thereof; and (c)
they publicly announced that she already resigned in order to
humiliate her.27
On the contrary, petitioners maintained that Alcaraz was validly
terminated from her probationary employment given her failure to
satisfy the prescribed standards for her regularization which were
made known to her at the time of her engagement.28
The LA Ruling
In a Decision dated March 30, 2006,29 the LA dismissed
Alcaraz’s complaint for lack of merit.
The LA rejected Alcaraz’s argument that she was not informed of
the reasonable standards to qualify as a regular employee
considering her admissions that she was briefed by Almazar on her
work during her preemployment orientation meeting30 and that she
received copies of Abbott’s Code of Conduct and Performance
Modules which were used for
_______________
25 Formerly, Article 281 of the Labor Code; renumbered pursuant to Republic Act
No. 10151.
26 Rollo (G.R. No. 192571), p. 267.
27 Id., at pp. 261-262.
28 Id., at pp. 263-267.
29 Id., at pp. 255-274. Penned by Labor Arbiter Jovencio Ll. Mayor, Jr.
30 Id., at p. 269.
699
VOL. 701, JULY 23, 2013 699

evaluating all types of Abbott employees.31 As Alcaraz was unable

to meet the standards set by Abbott as per her performance
evaluation, the LA ruled that the termination of her probationary
employment was justified.32 Lastly, the LA found that there was no
evidence to conclude that Abbott’s officers and employees acted in
bad faith in terminating Alcaraz’s employment.33
Displeased with the LA’s ruling, Alcaraz filed an appeal with the
National Labor Relations Commission (NLRC).
The NLRC Ruling
On September 15, 2006, the NLRC rendered a Decision,34
annulling and setting aside the LA’s ruling, the dispositive portion of
which reads:
WHEREFORE, the Decision of the Labor Arbiter dated 31 March

2006 [sic] is hereby reversed, annulled and set aside and judgment is
hereby rendered:
1. Finding respondents Abbot [sic] and individual respondents
to have committed illegal dismissal;
2. Respondents are ordered to immediately reinstate
complainant to her former position without loss of seniority rights
immediately upon receipt hereof;
3. To jointly and severally pay complainant backwages
computed from 16 May 2005 until finality of this decision. As of the
date hereof the backwages is computed at
a. Backwages for 15 months - PhP 1,650,000.00
_______________
31 Id., at p. 270.
32 Id., at pp. 271-272.
33 Id., at p. 273.
34 Id., at pp. 356-378. Penned by Commissioner Romeo L. Go, with Commissioners
Benedicto Ernesto R. Bitonio, Jr. (on leave) and Perlita B. Velasco, concurring.
700


b. 13th month pay - 110,000.00
TOTAL PhP 1,760,000.00
4. Respondents are ordered to pay complainant moral damages
of P50,000.00 and exemplary damages of P50,000.00.
5. Respondents are also ordered to pay attorney’s fees of 10% of
the total award.
6. All other claims are dismissed for lack of merit.
SO ORDERED.35
The NLRC reversed the findings of the LA and ruled that there
was no evidence showing that Alcaraz had been apprised of her
probationary status and the requirements which she should have
complied with in order to be a regular employee.36 It held that
Alcaraz’s receipt of her job description and Abbott’s Code of
Conduct and Performance Modules was not equivalent to her being
actually informed of the performance standards upon which she
should have been evaluated on.37 It further observed that Abbott did
not comply with its own standard operating procedure in evaluating
probationary employees.38 The NLRC was also not convinced that
Alcaraz was terminated for a valid cause given that petitioners’
allegation of Alcaraz’s “poor performance” remained
39
unsubstantiated.
Petitioners filed a motion for reconsideration which was denied
by the NLRC in a Resolution dated July 31, 2007.40
_______________
35 Id., at pp. 377-378.
36 Id., at p. 367.
37 Id., at p. 368.
38 Id., at p. 369.
39 Id., at pp. 370-373.
40 Id., at pp. 413-416. Penned by Commissioner Romeo L. Go, with Presiding
Commissioner Gerardo C. Nograles and Commissioner Perlita B. Velasco,
concurring.
701
VOL. 701, JULY 23, 2013 701

Aggrieved, petitioners filed with the CA a Petition for Certiorari

with Prayer for Issuance of a Temporary Restraining Order and/or
Writ of Preliminary Injunction, docketed as CA G.R. SP No. 101045
(First CA Petition), alleging grave abuse of discretion on the part of
NLRC when it ruled that Alcaraz was illegally dismissed.41
Pending resolution of the First CA Petition, Alcaraz moved for
the execution of the NLRC’s Decision before the LA, which
petitioners strongly opposed. The LA denied the said motion in an
Order dated July 8, 2008 which was, however, eventually reversed
on appeal by the NLRC.42 Due to the foregoing, petitioners filed
another Petition for Certiorari with the CA, docketed as CA G.R.
SP No. 111318 (Second CA Petition), assailing the propriety of the
execution of the NLRC decision.43
The CA Ruling
With regard to the First CA Petition, the CA, in a Decision44
dated December 10, 2009, affirmed the ruling of the NLRC and held
that the latter did not commit any grave abuse of discretion in
finding that Alcaraz was illegally dismissed.
It observed that Alcaraz was not apprised at the start of her
employment of the reasonable standards under which she could
qualify as a regular employee.45 This was based on its examination
of the employment contract which showed that the same did not
contain any standard of performance or any stipulation that Alcaraz
shall undergo a performance evaluation before she could qualify as a
regular employee.46 It also
_______________
41 Id., at pp. 417-450.
42 Id., at p. 1403.
43 Id.
44 Id., at pp. 1040-1054.
45 Id., at p. 1052.
46 Id.
702

found that Abbott was unable to prove that there was any reasonable
ground to terminate Alcaraz’s employment.47 Abbott moved for the
reconsideration of the aforementioned ruling which was, however,
denied by the CA in a Resolution48 dated June 9, 2010.
The CA likewise denied the Second CA Petition in a Resolution
dated May 18, 2010 (May 18, 2010 Resolution) and ruled that the
NLRC was correct in upholding the execution of the NLRC
Decision.49 Thus, petitioners filed a motion for reconsideration.
While the petitioners’ motion for reconsideration of the CA’s
May 18, 2010 Resolution was pending, Alcaraz again moved for the
issuance of a writ of execution before the LA. On June 7, 2010,
petitioners received the LA’s order granting Alcaraz’s motion for
execution which they in turn appealed to the NLRC — through a
Memorandum of Appeal dated June 16, 2010 (June 16, 2010
Memorandum of Appeal) — on the ground that the implementation
of the LA’s order would render its motion for reconsideration moot
and academic.50
Meanwhile, petitioners’ motion for reconsideration of the CA’s
May 18, 2010 Resolution in the Second CA Petition was denied via
a Resolution dated October 4, 2010.51 This attained finality on
January 10, 2011 for petitioners’ failure to timely appeal the same.52
Hence, as it stands, only the issues in the First CA petition are left to
be resolved.
Incidentally, in her Comment dated November 15, 2010, Alcaraz
also alleges that petitioners were guilty of forum shopping when
they filed the Second CA Petition pending the resolution of their
motion for reconsideration of the CA’s De-
_______________
47 Id., at p. 1053.
48 Id., at pp. 1139-1140.
49 Id., at p. 1218.
50 Id.
51 Id., at p. 1219.
52 Rollo (G.R. No. 193976), p. 30.
703
VOL. 701, JULY 23, 2013 703

cember 10, 2009 Decision i.e., the decision in the First CA

Petition.53 She also contends that petitioners have not complied with
the certification requirement under Section 5, Rule 7 of the Rules of
Court when they failed to disclose in the instant petition the filing of
the June 16, 2010 Memorandum of Appeal filed before the NLRC.54
The Issues Before the Court
The following issues have been raised for the Court’s resolution:
(a) whether or not petitioners are guilty of forum shopping and have
violated the certification requirement under Section 5, Rule 7 of the
Rules of Court; (b) whether or not Alcaraz was sufficiently informed
of the reasonable standards to qualify her as a regular employee; (c)
whether or not Alcaraz was validly terminated from her
employment; and (d) whether or not the individual petitioners herein
are liable.
The Court’s Ruling
A. Forum Shopping and Violation
of Section 5, Rule 7 of the Rules
of Court.
At the outset, it is noteworthy to mention that the prohibition
against forum shopping is different from a violation of the
certification requirement under Section 5, Rule 7 of the Rules of
Court. In Sps. Ong v. CA,55 the Court explained that:
x x x The distinction between the prohibition against forum

shopping and the certification requirement should by now be too
elementary to be misunderstood. To reiterate, compliance with the
certification against forum
_______________
53 Rollo (G.R. No. 192571), pp. 1223-1228.
54 Id., at p. 1224.
55 433 Phil. 490, 501-502; 384 SCRA 139, 148 (2002).
704

shopping is separate from and independent of the avoidance of the

act of forum shopping itself. There is a difference in the treatment
between failure to comply with the certification requirement and
violation of the prohibition against forum shopping not only in terms
of imposable sanctions but also in the manner of enforcing them. The
former constitutes sufficient cause for the dismissal without prejudice
[to the filing] of the complaint or initiatory pleading upon motion and
after hearing, while the latter is a ground for summary dismissal
thereof and for direct contempt. x x x.56
As to the first, forum shopping takes place when a litigant files

multiple suits involving the same parties, either simultaneously or
successively, to secure a favorable judgment. It exists where the
elements of litis pendentia are present, namely: (a) identity of
parties, or at least such parties who represent the same interests in
both actions; (b) identity of rights asserted and relief prayed for, the
relief being founded on the same facts; and (c) the identity with
respect to the two preceding particulars in the two (2) cases is such
that any judgment that may be rendered in the pending case,
regardless of which party is successful, would amount to res
judicata in the other case.57
In this case, records show that, except for the element of identity
of parties, the elements of forum shopping do not exist. Evidently,
the First CA Petition was instituted to question the ruling of the
NLRC that Alcaraz was illegally dismissed. On the other hand, the
Second CA Petition pertains to the propriety of the enforcement of
the judgment award pending the resolution of the First CA Petition
and the finality of the decision in the labor dispute between Alcaraz
and
_______________
56 Id., at pp. 501-502; p. 148. (Citations omitted)
57 Republic v. Mangotara, G.R. Nos. 170375, 170505, 173355-56, 173401,
173563-64, 178779 & 178894, July 7, 2010, 624 SCRA 360, 428, citing NBI-
Microsoft Corporation v. Hwang, 499 Phil. 423, 435-436; 460 SCRA 428, 440-441
(2005).
705
VOL. 701, JULY 23, 2013 705

the petitioners. Based on the foregoing, a judgment in the Second

CA Petition will not constitute res judicata insofar as the First CA
Petition is concerned. Thus, considering that the two petitions
clearly cover different subject matters and causes of action, there
exists no forum shopping.
As to the second, Alcaraz further imputes that the petitioners
violated the certification requirement under Section 5, Rule 7 of the
Rules of Court58 by not disclosing the fact that it filed the June 16,
2010 Memorandum of Appeal before the NLRC in the instant
petition.
In this regard, Section 5(b), Rule 7 of the Rules of Court requires
that a plaintiff who files a case should provide a complete statement
of the present status of any pending case if the latter involves the
same issues as the one that was filed. If there is no such similar
pending case, Section 5(a) of the same rule provides that the plaintiff
is obliged to declare under oath that to the best of his knowledge, no
such other action or claim is pending.
Records show that the issues raised in the instant petition and
those in the June 16, 2010 Memorandum of Appeal filed with the
NLRC likewise cover different subject matters and causes of action.
In this case, the validity of Alcaraz’s dis-
_______________
58 Sec. 5. Certification against forum shopping.—The plaintiff or principal
party shall certify under oath in the complaint or other initiatory pleading asserting a
claim for relief, or in a sworn certification annexed thereto and simultaneously filed
therewith: (a) that he has not theretofore commenced any action or filed any claim
involving the same issues in any court, tribunal or quasi-judicial agency and, to the
best of his knowledge, no such other action or claim is pending therein; (b) if there is
such other pending action or claim, a complete statement of the present status thereof;
and (c) if he should thereafter learn that the same or similar action or claim has been
filed or is pending, he shall report that fact within five (5) days therefrom to the court
wherein his aforesaid complaint or initiatory pleading has been filed.
x x x x
706

missal is at issue whereas in the said Memorandum of Appeal, the

propriety of the issuance of a writ of execution was in question.
Thus, given the dissimilar issues, petitioners did not have to disclose
in the present petition the filing of their June 16, 2010 Memorandum
of Appeal with the NLRC. In any event, considering that the issue
on the propriety of the issuance of a writ of execution had been
resolved in the Second CA Petition — which in fact had already
attained finality — the matter of disclosing the June 16, 2010
Memorandum of Appeal is now moot and academic.
Having settled the foregoing procedural matter, the Court now
proceeds to resolve the substantive issues.
B. Probationary employment;
grounds for termination.
A probationary employee, like a regular employee, enjoys
security of tenure. However, in cases of probationary employment,
aside from just or authorized causes of termination, an additional
ground is provided under Article 295 of the Labor Code, i.e., the
probationary employee may also be terminated for failure to qualify
as a regular employee in accordance with the reasonable standards
made known by the employer to the employee at the time of the
engagement.59 Thus, the services of an employee who has been
engaged on probationary basis may be terminated for any of the
following: (a) a just or (b) an authorized cause; and (c) when he fails
to qualify as a regular employee in accordance with reasonable
standards prescribed by the employer.60
Corollary thereto, Section 6(d), Rule I, Book VI of the
Implementing Rules of the Labor Code provides that if the employer
fails to inform the probationary employee of the rea-
_______________
59 Robinsons Galleria/Robinsons Supermarket Corporation v. Ranchez, G.R. No.
177937, January 19, 2011, 640 SCRA 135, 142.
60 Id.
707
VOL. 701, JULY 23, 2013 707

sonable standards upon which the regularization would be based on

at the time of the engagement, then the said employee shall be
deemed a regular employee, viz.:
(d) In all cases of probationary employment, the employer shall

make known to the employee the standards under which he will
qualify as a regular employee at the time of his engagement. Where
no standards are made known to the employee at that time, he shall
be deemed a regular employee.
In other words, the employer is made to comply with two (2)

requirements when dealing with a probationary employee: first, the
employer must communicate the regularization standards to the
probationary employee; and second, the employer must make such
communication at the time of the probationary employee’s
engagement. If the employer fails to comply with either, the
employee is deemed as a regular and not a probationary employee.
Keeping with these rules, an employer is deemed to have made
known the standards that would qualify a probationary employee to
be a regular employee when it has exerted reasonable efforts to
apprise the employee of what he is expected to do or accomplish
during the trial period of probation. This goes without saying that
the employee is sufficiently made aware of his probationary status as
well as the length of time of the probation.
The exception to the foregoing is when the job is self-descriptive
in nature, for instance, in the case of maids, cooks, drivers, or
messengers.61 Also, in Aberdeen Court, Inc. v. Agustin,62 it has been
held that the rule on notifying a probationary employee of the
standards of regularization should not be used to exculpate an
employee who acts in a manner contrary to basic knowledge and
common sense in regard to
_______________
61 Id., at p. 145.
62 495 Phil. 706, 716-717; 456 SCRA 32, 43 (2005).
708

which there is no need to spell out a policy or standard to be met. In

the same light, an employee’s failure to perform the duties and
responsibilities which have been clearly made known to him
constitutes a justifiable basis for a probationary employee’s
nonregularization.
In this case, petitioners contend that Alcaraz was terminated
because she failed to qualify as a regular employee according to
Abbott’s standards which were made known to her at the time of her
engagement. Contrarily, Alcaraz claims that Abbott never apprised
her of these standards and thus, maintains that she is a regular and
not a mere probationary employee.
The Court finds petitioners’ assertions to be well-taken.
A punctilious examination of the records reveals that Abbott had
indeed complied with the above-stated requirements. This
conclusion is largely impelled by the fact that Abbott clearly
conveyed to Alcaraz her duties and responsibilities as Regulatory
Affairs Manager prior to, during the time of her engagement, and the
incipient stages of her employment. On this score, the Court finds it
apt to detail not only the incidents which point out to the efforts
made by Abbott but also those circumstances which would show that
Alcaraz was well-apprised of her employer’s expectations that
would, in turn, determine her regularization:
(a) On June 27, 2004, Abbott caused the publication in a major
broadsheet newspaper of its need for a Regulatory Affairs Manager,
indicating therein the job description for as well as the duties and
responsibilities attendant to the aforesaid position; this prompted
Alcaraz to submit her application to Abbott on October 4, 2004;
(b) In Abbott’s December 7, 2004 offer sheet, it was stated that
Alcaraz was to be employed on a probationary status;
(c) On February 12, 2005, Alcaraz signed an employment
contract which specifically stated, inter alia, that she was to
709
VOL. 701, JULY 23, 2013 709

be placed on probation for a period of six (6) months beginning

February 15, 2005 to August 14, 2005;
(d) On the day Alcaraz accepted Abbott’s employment offer,
Bernardo sent her copies of Abbott’s organizational structure and her
job description through e-mail;
(e) Alcaraz was made to undergo a pre-employment orientation
where Almazar informed her that she had to implement Abbott’s
Code of Conduct and office policies on human resources and finance
and that she would be reporting directly to Walsh;
(f) Alcaraz was also required to undergo a training program as
part of her orientation;
(g) Alcaraz received copies of Abbott’s Code of Conduct and
Performance Modules from Misa who explained to her the
procedure for evaluating the performance of probationary
employees; she was further notified that Abbott had only one
evaluation system for all of its employees; and
(h) Moreover, Alcaraz had previously worked for another
pharmaceutical company and had admitted to have an “extensive
training and background” to acquire the necessary skills for her
job.63
Considering the totality of the above-stated circumstances, it
cannot, therefore, be doubted that Alcaraz was well-aware that her
regularization would depend on her ability and capacity to fulfill the
requirements of her position as Regulatory Affairs Manager and that
her failure to perform such would give Abbott a valid cause to
terminate her probationary employment.
Verily, basic knowledge and common sense dictate that the
adequate performance of one’s duties is, by and of itself, an inherent
and implied standard for a probationary employee to be regularized;
such is a regularization standard which need
_______________
63 Rollo (G.R. No. 192571), p. 1201.
710

not be literally spelled out or mapped into technical indicators in

every case. In this regard, it must be observed that the assessment of
adequate duty performance is in the nature of a management
prerogative which when reasonably exercised — as Abbott did in
this case — should be respected. This is especially true of a
managerial employee like Alcaraz who was tasked with the vital
responsibility of handling the personnel and important matters of her
department.
In fine, the Court rules that Alcaraz’s status as a probationary
employee and her consequent dismissal must stand. Consequently, in
holding that Alcaraz was illegally dismissed due to her status as a
regular and not a probationary employee, the Court finds that the
NLRC committed a grave abuse of discretion.
To elucidate, records show that the NLRC based its decision on
the premise that Alcaraz’s receipt of her job description and Abbott’s
Code of Conduct and Performance Modules was not equivalent to
being actually informed of the performance standards upon which
she should have been evaluated on.64 It, however, overlooked the
legal implication of the other attendant circumstances as detailed
herein which should have warranted a contrary finding that Alcaraz
was indeed a probationary and not a regular employee — more
particularly the fact that she was well-aware of her duties and
responsibilities and that her failure to adequately perform the same
would lead to her non-regularization and eventually, her termination.
Accordingly, by affirming the NLRC’s pronouncement which is
tainted with grave abuse of discretion, the CA committed a
reversible error which, perforce, necessitates the reversal of its
decision.
_______________
64 Id., at pp. 367-368, 370.
711
VOL. 701, JULY 23, 2013 711

C. Probationary employment;
termination procedure.
A different procedure is applied when terminating a probationary
employee; the usual two-notice rule does not govern.65
_______________
65 Refers to the procedure stated in Article 291(b) of the Labor Code, as
renumbered pursuant to Republic Act No. 10151, viz.:
Article 291. Miscellaneous Provisions.—
x x x x
(b) Subject to the constitutional right of workers to security of tenure and their
right to be protected against dismissal except for a just and authorized cause and
without prejudice to the requirement of notice under Article 283 of this Code, the
employer shall furnish the worker whose employment is sought to be terminated a
written notice containing a statement of the cause for termination and shall afford the
latter ample opportunity to be heard and to defend himself with the assistance of his
representative if he so desires in accordance with company rules and regulations
promulgated pursuant to guidelines set by the Department of Labor and Employment.
x x x x
This procedure is also found in Section 2(d), Rule I, Book VI of the Omnibus Rules
Implementing the Labor Code which state:
x x x x
(d) In all cases of termination of employment, the following standards of
due process shall be substantially observed:
For termination of employment based on just causes as defined in Article 282
[now, Article 296] of the Labor Code:
(i) A written notice served on the employee specifying the ground
or grounds for termination, and giving said employee reasonable
opportunity within which to explain his side.
(ii) A hearing or conference during which the employee concerned,
with the assistance of counsel if he so desires is given opportunity to
respond to the charge, present his evidence, or rebut the evidence
presented against him.
(iii) A written notice of termination served on the employee,
indicating that upon due consideration of all the
712

Section 2, Rule I, Book VI of the Implementing Rules of the Labor

Code states that “[i]f the termination is brought about by the x x x
failure of an employee to meet the standards of the employer in case
of probationary employment, it shall be sufficient that a written
notice is served the employee, within a reasonable time from the
effective date of termination.”
As the records show, Alcaraz’s dismissal was effected through a
letter dated May 19, 2005 which she received on May 23, 2005 and
again on May 27, 2005. Stated therein were the reasons for her
termination, i.e., that after proper evaluation, Abbott determined that
she failed to meet the reasonable standards for her regularization
considering her lack of time and people management and decision-
making skills, which are necessary in the performance of her
functions as Regulatory Affairs Manager.66 Undeniably, this written
notice sufficiently meets the criteria set forth above, thereby
legitimizing the cause and manner of Alcaraz’s dismissal as a
probationary employee under the parameters set by the Labor
Code.67
D. Employer’s violation of company
policy and procedure.
Nonetheless, despite the existence of a sufficient ground to
terminate Alcaraz’s employment and Abbott’s compliance with the
Labor Code termination procedure, it is readily apparent that Abbott
breached its contractual obligation to Alcaraz when it failed to abide
by its own procedure in evaluating the performance of a
probationary employee.
Veritably, a company policy partakes of the nature of an implied
contract between the employer and employee. In Parts Depot, Inc. v.
Beiswenger,68 it has been held that:
_______________
circumstances, grounds have been established to justify his termination.
66 Rollo, pp. 78-81.
67 Id., at p. 1047.
68 170 S.W.3d 354 (Ky. 2005).
713
VOL. 701, JULY 23, 2013 713

[E]mployer statements of policy . . . can give rise to contractual

rights in employees without evidence that the parties mutually agreed
that the policy statements would create contractual rights in the
employee, and, hence, although the statement of policy is signed by
neither party, can be unilaterally amended by the employer without
notice to the employee, and contains no reference to a specific
employee, his job description or compensation, and although no
reference was made to the policy statement in pre-employment
interviews and the employee does not learn of its existence until after
his hiring. Toussaint, 292 N.W.2d at 892. The principle is akin to
estoppel. Once an employer establishes an express personnel
policy and the employee continues to work while the policy
remains in effect, the policy is deemed an implied contract for so
long as it remains in effect. If the employer unilaterally changes
the policy, the terms of the implied contract are also thereby
changed. (Emphasis and underscoring supplied.)
Hence, given such nature, company personnel policies create an

obligation on the part of both the employee and the employer to
abide by the same.
Records show that Abbott’s PPSE procedure mandates, inter alia,
that the job performance of a probationary employee should be
formally reviewed and discussed with the employee at least twice:
first on the third month and second on the fifth month from the date
of employment. Abbott is also required to come up with a
Performance Improvement Plan during the third month review to
bridge the gap between the employee’s performance and the
standards set, if any.69 In addition, a signed copy of the PPSE form
should be submitted to Abbott’s HRD as the same would serve as
basis for recommending the confirmation or termination of the
probationary employment.70
_______________
69 Rollo (G.R. No. 192571), p. 1052.
70 Id., at p. 1043.
714

In this case, it is apparent that Abbott failed to follow the above-

stated procedure in evaluating Alcaraz. For one, there lies a hiatus of
evidence that a signed copy of Alcaraz’s PPSE form was submitted
to the HRD. It was not even shown that a PPSE form was completed
to formally assess her performance. Neither was the performance
evaluation discussed with her during the third and fifth months of
her employment. Nor did Abbott come up with the necessary
Performance Improvement Plan to properly gauge Alcaraz’s
performance with the set company standards.
While it is Abbott’s management prerogative to promulgate its
own company rules and even subsequently amend them, this right
equally demands that when it does create its own policies and
thereafter notify its employee of the same, it accords upon itself the
obligation to faithfully implement them. Indeed, a contrary
interpretation would entail a disharmonious relationship in the work
place for the laborer should never be mired by the uncertainty of
flimsy rules in which the latter’s labor rights and duties would, to
some extent, depend.
In this light, while there lies due cause to terminate Alcaraz’s
probationary employment for her failure to meet the standards
required for her regularization, and while it must be further pointed
out that Abbott had satisfied its statutory duty to serve a written
notice of termination, the fact that it violated its own company
procedure renders the termination of Alcaraz’s employment
procedurally infirm, warranting the payment of nominal damages. A
further exposition is apropos.
Case law has settled that an employer who terminates an
employee for a valid cause but does so through invalid procedure is
liable to pay the latter nominal damages.
In Agabon v. NLRC (Agabon),71 the Court pronounced that where
the dismissal is for a just cause, the lack of statutory
_______________
71 G.R. No. 158693, November 17, 2004, 442 SCRA 573.
715
VOL. 701, JULY 23, 2013 715

due process should not nullify the dismissal, or render it illegal, or

ineffectual. However, the employer should indemnify the employee
for the violation of his statutory rights.72 Thus, in Agabon, the
employer was ordered to pay the employee nominal damages in the
amount of P30,000.00.73
Proceeding from the same ratio, the Court modified Agabon in
the case of Jaka Food Processing Corporation v. Pacot (Jaka)74
where it created a distinction between procedurally defective
dismissals due to a just cause, on one hand, and those due to an
authorized cause, on the other.
It was explained that if the dismissal is based on a just cause
under Article 282 of the Labor Code (now Article 296) but the
employer failed to comply with the notice requirement, the sanction
to be imposed upon him should be tempered because the dismissal
process was, in effect, initiated by an act imputable to the employee;
if the dismissal is based on an authorized cause under Article 283
(now Article 297) but the employer failed to comply with the notice
requirement, the sanction should be stiffer because the dismissal
process was initiated by the employer’s exercise of his management
prerogative.75 Hence, in Jaka, where the employee was dismissed for
an authorized cause of retrenchment76 — as contradistinguished
from the employee in Agabon who was dismissed for a just cause of
neglect of duty77 — the Court ordered the employer to pay the
employee nominal damages at the higher amount of P50,000.00.
Evidently, the sanctions imposed in both Agabon and Jaka
proceed from the necessity to deter employers from future
_______________
72 Id., at p. 616.
73 Id., at p. 620.
74 494 Phil. 114, 119-121; 454 SCRA 119, 125 (2005).
75 Id., at p. 121; p. 126.
76 Id., at p. 122; p. 127.
77 Supra note 71, at p. 605.
716

violations of the statutory due process rights of employees.78 In

similar regard, the Court deems it proper to apply the same principle
to the case at bar for the reason that an employer’s contractual
breach of its own company procedure — albeit not statutory in
source — has the parallel effect of violating the laborer’s rights.
Suffice it to state, the contract is the law between the parties and
thus, breaches of the same impel recompense to vindicate a right that
has been violated. Consequently, while the Court is wont to uphold
the dismissal of Alcaraz because a valid cause exists, the payment of
nominal damages on account of Abbott’s contractual breach is
warranted in accordance with Article 2221 of the Civil Code.79
Anent the proper amount of damages to be awarded, the Court
observes that Alcaraz’s dismissal proceeded from her failure to
comply with the standards required for her regularization. As such, it
is undeniable that the dismissal process was, in effect, initiated by an
act imputable to the employee, akin to dismissals due to just causes
under Article 296 of the Labor Code. Therefore, the Court deems it
appropriate to fix the amount of nominal damages at the amount of
P30,000.00, consistent with its rulings in both Agabon and Jaka.
E. Liability of individual peti-
tioners as corporate officers.
It is hornbook principle that personal liability of corporate
directors, trustees or officers attaches only when: (a) they assent to a
patently unlawful act of the corporation, or when they are guilty of
bad faith or gross negligence in directing its affairs, or when there is
a conflict of interest resulting in damages to the corporation, its
stockholders or other persons;
_______________
78 Id., at p. 617.
79 Article 2221. Nominal damages are adjudicated in order that a right of the
plaintiff, which has been violated or invaded by the defendant, may be vindicated or
recognized, and not for the purpose of indemnifying the plaintiff for any loss suffered
by him.
717
VOL. 701, JULY 23, 2013 717
(b) they consent to the issuance of watered down stocks or when,

having knowledge of such issuance, do not forthwith file with the
corporate secretary their written objection; (c) they agree to hold
themselves personally and solidarily liable with the corporation; or
(d) they are made by specific provision of law personally answerable
for their corporate action.80
In this case, Alcaraz alleges that the individual petitioners acted
in bad faith with regard to the supposed crude manner by which her
probationary employment was terminated and thus, should be held
liable together with Abbott. In the same vein, she further attributes
the loss of some of her remaining belongings to them.81
Alcaraz’s contention fails to persuade.
A judicious perusal of the records show that other than her
unfounded assertions on the matter, there is no evidence to support
the fact that the individual petitioners herein, in their capacity as
Abbott’s officers and employees, acted in bad faith or were
motivated by ill will in terminating Alcaraz’s services. The fact that
Alcaraz was made to resign and not allowed to enter the workplace
does not necessarily indicate bad faith on Abbott’s part since a
sufficient ground existed for the latter to actually proceed with her
termination. On the alleged loss of her personal belongings, records
are bereft of any showing that the same could be attributed to Abbott
or any of its officers. It is a well-settled rule that bad faith cannot be
presumed and he who alleges bad faith has the onus of proving it.
All told, since Alcaraz failed to prove any malicious act on the part
of Abbott or any of its officers, the Court finds the award of moral or
exemplary damages unwarranted.
WHEREFORE, the petition is GRANTED. The Decision dated
December 10, 2009 and Resolution dated June 9, 2010
_______________
80 Carag v. NLRC, 548 Phil. 581, 605; 520 SCRA 28, 53 (2007), citing McLeod v.
NLRC, 541 Phil. 214, 242; 512 SCRA 222, 249 (2007).
81 Rollo (G.R. No. 192571), pp. 262, 1046.
718

of the Court of Appeals in CA-G.R. SP No. 101045 are hereby

REVERSED and SET ASIDE. Accordingly, the Decision dated
March 30, 2006 of the Labor Arbiter is REINSTATED with the
MODIFICATION that petitioner Abbott Laboratories, Philippines
be ORDERED to pay respondent Pearlie Ann F. Alcaraz nominal
damages in the amount of P30,000.00 on account of its breach of its
own company procedure.
SO ORDERED.
Sereno (CJ.), Carpio, Velasco, Jr., Leonardo-De Castro,

Peralta, Bersamin, Del Castillo, Abad, Villarama, Jr., Perez and
Reyes, JJ., concur.
Brion, J., See Dissent.
Mendoza, J., But concurs with J. Brion in his views on the
procedural aspect.
Leonen, J., I join J. Brion in his dissent.
DISSENTING OPINION
BRION, J.:
The Case
The case in caption was a Second Division illegal dismissal case
that the Court en banc accepted for decision pursuant to Section 3,
Rule 2 of the Internal Rules of the Supreme Court.
A. The Issues Posed
The case posed two issues to the Court for resolution. The first is
the manner of review that the Court should undertake. This is an
issue that underlies all the Court’s decision making in light of the
various modes of review and essentials that the Rules of Court
require. The second and core issue relates to the merits of the
legality or illegality of the dismissal: whether the Labor Code
requirements governing the
719
VOL. 701, JULY 23, 2013 719

dismissal of a probationary employee had been complied with,

considered from the prism of the mode of review and the nature of
the decision under review.
B. The Factual Highlights
To briefly summarize the highlights of the case, Abbott
Laboratories, Phils. (petitioner), Cecille A. Terrible, Edwin D. Feist,
Maria Olivia T. Yabut-Misa, Teresita C. Bernardo, and Allan G.
Almazar (individual petitioners) are the employer and its senior
officials who dismissed respondent Pearlie Ann F. Alcaraz from
employment within three (3) months from her engagement. The
respondent complained against the petitioners on the ground that she
had been illegally dismissed: (1) she was not informed of the
standards that would govern her as a probationary employee, as
required by the law (the Labor Code) and its implementing rules; (2)
the petitioners even violated the company’s own internal rules on the
manner of dismissing probationary employees; (3) substantively, her
dismissal was without the required just cause as required by the law
and the rules; and (4) her dismissal was done oppressively and in
bad faith.
C. The Rulings Below
The Labor Arbiter ruled that the dismissal had been valid but
the National Labor Relations Commission (NLRC) reversed the
Labor Arbiter; found the dismissal illegal; and damages and
attorney’s fees because of the manner the dismissal was effected.
The Court of Appeals (CA) found no grave abuse of discretion and
accordingly denied the Rule 65 petition that the petitioner Abbott
brought.
D. The Current Court Rulings
The Ponencia. In the present Rule 45 petition for review on
certiorari before this Court, the ponencia undertook a weighing of
the evidence in light of her own view of how
720

the evidence should be interpreted, and came out with her own
ruling for the grant of the petition.
This Dissent. I vote to dismiss the petition before us as I agree
with the decision of the CA that the NLRC did not commit any
grave abuse of discretion in concluding that respondent had been
illegally dismissed from employment.
Discussion of the Issues
I. The Procedural Issue
A. The Preliminary Issue: Manner of Review
A labor case finds its way into the judicial system from the
NLRC whose decision is final and executory. Finality simply means
that the NLRC ruling is no longer appealable; the legal intent is to
confine adjudication of labor cases to labor tribunals with the
expertise in these cases and thereby bring the resolution of the case
to a close at the soonest possible time.
When an administrative ruling (or any ruling for that matter) is
already final and unappealable, the only recourse open under the
Rules of Court is through a limited review on jurisdictional grounds
under Rule 65. This has been the mode of review followed since the
Labor Code took effect in November 1974; labor cases were directly
brought to this Court but only on jurisdictional grounds under Rule
65.1
_______________
1 The following explanation was made in my Rejoinder to Reply (On the manner
of reviewing a Court of Appeals Labor Ruling) that was submitted to the Court En
Banc in the course of the exchanges on this aspect of the case. The explanation
distinguished between appealable cases and those that, while not appealable, can still
be reviewed through a Rule 65 petition for certiorari.
“For a full understanding of these distinctions, it must be kept in mind that several
levels of review may exist for rulings emanating from the lowest levels of
adjudication before they reach the Supreme
721
VOL. 701, JULY 23, 2013 721

In 1998, the Court — in lieu of directly acting on labor cases

under Rule 65 of the Rules of Court — opted to change the
_______________
Court. The ruling of an inferior court or tribunal (for example, the Regional Trial
Court [RTC]) is first reviewed by an appellate court (the CA) on questions of fact or
mixed questions of fact and law; the CA decision may then in turn be reviewed by the
Supreme Court under Rule 45.
Generally, two types of decisions or rulings may be brought to the appellate courts
for review and decision; the appellate courts’ decisions are in turn subject to review
by the Supreme Court.
The first type relates to cases that come to the appellate court by way of appeal
(e.g., the ruling of the RTC in the exercise of its original jurisdiction that is appealed
to the CA on issues of facts and law under Rule 41 of the Rules of Court). The second
type involves the review by the CA of decisions of inferior courts or tribunals whose
rulings, by law, are final and executory (e.g., the ruling of the National Labor
Relations Commission [NLRC] that under the Labor Code is final and executory).
This is the review of rulings that, by law, is not appealable and thus can only be
made on limited jurisdictional grounds.
A CA ruling under the first type can be challenged by the aggrieved party before
the Supreme Court through a petition for review on certiorari under Rule 45 of the
Rules of Court. Under Rule 45, the review is only on questions of law unless a review
of questions of fact is allowed under the terms established by jurisprudence. This is
the case in the example given above — an RTC ruling that is appealed to the CA on
both factual and legal grounds and which CA decision on appeal is now before the
Supreme Court for further review. This may be the model of a Supreme Court review
that the ponente might have had in mind in asserting that the Supreme Court should
be able to undertake a review of the full range of legal issues before it.
In the second type as exemplified above, a ruling by the NLRC, although final
and executory, may be brought to the CA under Rule 65 of the Rules of Court, i.e., on
a petition for certiorari, limited to jurisdictional grounds, usually for grave abuse of
discretion amounting to lack or excess of jurisdiction. The final and executory nature
of the NLRC decision under review can best be appreci-
722

procedure of review through its ruling in St. Martin Funeral

Homes, Inc. vs. National Labor Relations Commission,2 taking
into account the judicial hierarchy of courts and the growing number
of labor cases elevated to the Supreme Court under Rule 65. The
Court resolved that the proper recourse from the NLRC’s final and
executory ruling is to assail the ruling before the CA under Rule 65.
Thus, the unappealable character of the NLRC ruling (as declared by
substantive law) did not change; only the process of review changed
in terms of the court (from the Supreme Court to the Court of
Appeals) to which the labor case can initially be brought.
From the CA ruling, a dissatisfied party has the option to file an
appeal with the Supreme Court through a petition for review on
certiorari under Rule 45 of the Rules of Court. This mode of appeal
limits the review to questions of law.
B. Standard of Review of a Labor Case under Rule 45 of the
Rules of Court
Montoya v. Transmed3the CourtMontoya
_______________
ated when it is considered that the decision can immediately be implemented
unless a temporary restraining order or injunction is issued by the CA; the Rule 65
mode of review is rendered necessary because the decision or ruling under review, by
law, is already final. Finality1 means that the decision is no longer appealable1 and
may be reviewed only when the ruling is void because of jurisdictional defects.”
2 356 Phil. 811; 295 SCRA 494 (1998).
3 G.R. No. 183329, August 27, 2009, 597 SCRA 334.
723
VOL. 701, JULY 23, 2013 723

In a Rule 45 review, we consider the correctness of the assailed CA

decision, in contrast with the review for jurisdictional error that we
undertake under Rule 65. Furthermore, Rule 45 limits us to the
review of questions of law raised against the assailed CA decision.
In ruling for legal correctness, we have to view the CA decision in
the same context that the petition for certiorari it ruled upon was
presented to it; we have to examine the CA decision from the
prism of whether it correctly determined the presence or absence
of grave abuse of discretion in the NLRC decision before it, not
on the basis of whether the NLRC decision on the merits of the
case was correct. In other words, we have to be keenly aware that
the CA undertook a Rule 65 review, not a review on appeal, of the
NLRC decision challenged before it. This is the approach that should
be basic in a Rule 45 review of a CA ruling in a labor case. In
question form, the question to ask is: Did the CA correctly
determine whether the NLRC committed grave abuse of
discretion in ruling on the case?4 [emphases and italics supplied;
citations omitted]
Thus, under the Rule 65 review by the CA, Montoya reiterates

that the sole ground or issue allowed is jurisdictional — the
presence or absence of grave abuse of discretion on the part of the
NLRC in ruling on the case. To state the obvious, this kind of review
would have made it easier for the CA to handle the case; in the
absence of a grave abuse of discretion, it can dismiss labor cases for
lack of grave abuse of discretion as we do in this Court.
From the CA, further recourse is through a Rule 45 review by
this Court on questions of law in accordance with prevailing
rulings. The office of a petition for review on certiorari is not to
examine and settle factual questions already ruled upon below. In
this review, the Court simply determines whether the legal
correctness of the CA’s finding that the
_______________
4 Id., at pp. 342-343.
724

NLRC ruling of illegal dismissal had basis in fact and in law.

This manner of review is effectively a supervisory review by the
courts that bears two significant characteristics: first, it respects the
mandate of the law that the decision below is final and is not for the
courts to review on appeal for its legal and factual merits; and
second, review by the courts (particularly by the Supreme Court) in
the exercise of their supervisory certiorari jurisdiction is mandated
no less than by the Constitution and is intended to ensure that the
deciding entity stayed within the due bounds of its authority or
jurisdiction.5
Specifically, in reviewing a CA labor ruling under Rule 45 of the
Rules of Court, the Court’s review is limited to:
(1) Ascertaining the correctness of the CA’s decision in
finding the presence or absence of a grave abuse of discretion.
This is done by examining, on the basis of the parties’ presentations,
whether the CA correctly determined that at the NLRC level, all the
adduced pieces of evidence were considered; no evidence which
should not have been considered was considered; and the evidence
presented supports the NLRC findings; and
(2) Deciding any other jurisdictional error that attended the
CA’s interpretation or application of the law.
In this kind of limited review, the Court avoids reviewing a labor
case by re-weighing the evidence or re-evaluating its sufficiency; the
task of weighing or evaluation, as a rule, lies within the NLRC’s
jurisdiction as an administrative appellate body.
If the NLRC ruling has basis in the evidence and the applicable
law and jurisprudence, then no grave abuse of discretion exists and
the CA should so declare and, accordingly, dismiss the petition. If
grave abuse of discretion exists, then the CA
_______________
5 Rejoinder to Reply, supra, at Note 1.
725
VOL. 701, JULY 23, 2013 725

must grant the petition and nullify the NLRC ruling, entering at the
same time the ruling that is justified under the evidence and the
governing law, rules and jurisprudence. In our Rule 45 review, this
Court must deny the petition if it finds that the CA correctly acted.
In the context of the present case, the CA found no grave abuse
of discretion committed by the NLRC; hence, the CA dismissed the
Rule 65 petition before it. In our own ruling on the Rule 45
petition before us, we should evaluate the petition in this light, not
in the manner that the ponencia did in concluding for the grant of
the petition and ruling in favor of the petitioners.
By so doing, the ponencia undertook a factual appellate review
that laid the whole case open for the detailed examination of every
piece of evidence adduced in the case and for the evaluation of the
correctness of the application of the law to the evidence found. This
is a review that a Rule 45 petition does not allow.
II. The Substantive Issues
A. The Respondent’s Status of Employment
II.A.1. Standards to determine probationary
employment
While the respondent might have been hired as a probationary
employee, the petitioners’ evidence did not establish the employers’
compliance with the probationary employment requirements under
Article 281 of the Labor Code (as amended) and Section 6(d) of
the Implementing Rules of Book VI, Rule I of the Labor Code (as
amended). Thus, the respondent should be considered a regular
employee and the case should be reviewed on this basis.
726


Article 281 of the Labor Code, as amended, provides:
ART. 281. Probationary employment.—Probationary
employment shall not exceed six (6) months from the date the
employee started working, unless it is covered by an apprenticeship
agreement stipulating a longer period. The services of an employee
who has been engaged on a probationary basis may be terminated for
a just cause or when he fails to qualify as a regular employee in
accordance with reasonable standards made known by the
employer to the employee at the time of his engagement. An
employee who is allowed to work after a probationary period shall be
considered a regular employee. [italics supplied; emphasis ours]
Further, Section 6(d) of the Implementing Rules of Book VI,

Rule I of the Labor Code, as amended, states:
Sec. 6. Probationary employment.—There is probationary

employment where the employee, upon his engagement, is made to
undergo a trial period during which the employer determines his
fitness to qualify for regular employment, based on reasonable
standards made known to him at the time of engagement.
[emphasis supplied]
Probationary employment shall be governed by the following
rules:
x x x x
(d) In all cases of probationary employment, the employer
shall make known to the employee the standards under which he
will qualify as a regular employee at the time of his engagement.
Where no standards are made known to the employee at that
time, he shall be deemed a regular employee. [emphases ours;
italics supplied]
To sum up these provisions, a valid probationary employment

requires the concurrence of two requirements. First, the
727
VOL. 701, JULY 23, 2013 727

employer shall make known the reasonable standard (performance

standard) whose compliance will render the employee qualified to
be a regular employee. Second, the employer shall inform the
employee of the applicable performance standard at the time of
his/her engagement. Failing in one or both, the employee, even if
initially hired as a probationary employee, should be viewed and
considered a regular employee.
The ponencia apparently fully agrees with the above statement of
the applicable law as it substantially recites the same requirements,
including the consequence that upon failure to comply with these
same requirements, “the employee is deemed as a regular and not a
probationary employee.”6 It continues, however, with a twist that
effectively negates what it has stated and admitted about the need to
communicate the regularization standards to the employee, thus:
Keeping with these rules, an employees is deemed to have made

known the standards that would qualify a probationary employee to
be a regular employee when it has exerted reasonable efforts to
apprise the employee of what he is expected to do to accomplish
during the trial of probation. This goes without saying that the
employee is sufficiently made aware of his probationary status as
well as the length of time of the probation.
The exception to the foregoing is when the job is self-descriptive
in nature, for instance, in the case of maids, cooks, drivers, or
messengers. Also in Aberdeen Court, Inc. v. Agustin, it has been held
that the rule on notifying a probationary employee of the standards of
regularization should not be used to exculpate an employee in a
manner contrary to basic knowledge and common sense in regard to
which there is no need to spell out a policy or standard to be met. In
the same light, an employee’s failure to perform the duties and
responsibilities which have been clearly made known to him consti-
6 Decision, at page 12.
728

tutes a justifiable basis for a probationary employee’s non-

regularization. [footnotes from the original, omitted]
Based on these premises, the ponencia then deftly argues that

because the duties and responsibilities of the position have been
explained to the respondent, an experienced human resource
specialist, she should have known what was expected for her to
attain regular status.
The ponencia’s reasoning, however, is badly flawed.
1st. The law and the rules require that there performance
standards communicated at the time of engagement to the
probationary employee. The performance standards to be met are the
employer’s specific expectations of how the probationary employee
should perform.
The ponencia impliedly admits that no performance standards
were expressly given but argues that because the respondent had
been informed of her duties and responsibilities (a fact that was and
is not disputed), she should be deemed to know what was expected
of her for purposes of regularization.
This is a major flaw that the ponencia satisfies only via an
assumption. The ponencia apparently forgets that knowledge of
duties and responsibilities is different from the measure of how these
duties and responsibilities should be delivered. They are separate
elements and the latter element is missing in the present case.
2nd. The ponencia glosses over the communication aspect. Not
only must there be express performance standards (except in specific
instances defined in the implementing rules, discussed below); there
must be effective communication. If no standards were provided,
what would be communicated?
3rd. The ponencia badly contradicts itself in claiming that actual
communication of specific standards might not be necessary “when
the job is self-descriptive in nature, for instance, in the case of
maids, cooks, drivers, or messengers.” The re-
729
VOL. 701, JULY 23, 2013 729

spondent, in the first place, was never a maid, cook, driver or a

messenger and cannot be placed under this classification; she was
hired and employed as a human resources manager, in short, a
managerial employee. Plain and common sense reasoning by one
who ever had been in an employment situation dictates that the job
of a managerial employee cannot be self-explanatory, in the way the
ponencia implied; the complexity of a managerial job must
necessarily require that the level of performance to be delivered
must be specified and cannot simply be assumed based on the
communication of the manager’s duties and responsibilities.
4th. The ponencia also forgets that what these “performance
standards” or measures cannot simply be assumed because they are
critically important in this case, or for that matter, in any case
involving jobs whose duties and responsibilities are not simple or
self-descriptive. If the respondent had been evaluated or assessed in
the manner that the company’s internal rules require, these standards
would have been the basis for her performance or lack of it. Last but
not the least, the respondent’s services were terminated on the basis
of the performance standards that, by law, the employer set or
prescribed at the time of the employee’s engagement. If none had
been prescribed in the first place, under what basis could the
employee then be assessed for purposes of termination or
regularization?
From these preliminary take-off points in the ponencia’s
premises, it can already be discerned that something is badly
amiss and skewed in its appreciation and review of the rulings of
the NLRC and the CA. It is an appreciation that goes beyond
what a determination of grave abuse of discretion requires. It is
an evaluation of the adduced evidence based on externalities
beyond the face value of the presented evidence.
In this case, the ponencia simply disregarded the plain import
of the evidence or the lack of it, and ventured into the realm of
assumptions to justify its de-
730
sired conclusions. In the mathematical realm of problem solving,

it appears to have started from the conclusion and solved the
problem backwards so that the conclusion would fit into its
stretched reading of the evidence.
II.A.2. The respondent should be deemed a
regular employee
In the context of this case, an initial determination of how the
respondent’s employment started and of her legal status at that point
is the best starting point in determining the validity of her dismissal.
The respondent was indisputably initially hired as a probationary
employee. This is not a contested point. The established facts and
the applicable law, however, dictate otherwise from the perspective
of law as the petitioners failed to show compliance with the two
requirements of Article 281 of the Labor Code (as amended) and of
Section 6(d) of the Implementing Rules of Book VI, Rule I of the
Labor Code (as amended).
This was what the NLRC found, leading the CA to conclude
that no grave abuse of discretion intervened in the NLRC’s
ruling because its findings were supported by the evidence on
record and by the correctly-chosen applicable law. In stark
contrast, the ponencia’s reading, although based on the same legal
premises, was based on shaky assumptions, not on the hard evidence
that the tribunals below appreciated.
II.A.2(a). No specific employment standard on
record.
As the NLRC found (and as confirmed by the CA), no term or
provision exists in the respondent’s Employment Contract7
_______________
7 Rollo, p. 174.
731
VOL. 701, JULY 23, 2013 731

relating to the performance standard that the respondent was

expected to observe. The Employment Contract, duly presented as
evidence, only proved the terms and conditions of the respondent’s
employment as therein indicated, i.e., the position title, the assigned
department, the status of employment, and the period of employment.
Beyond these, the Employment Contract did not say anything more.
To be sure, nothing more can be extracted from this piece of
evidence except the facts stated and the inferences by implication
from the expressly disclosed information. Significantly, none of
these can be characterized or inferred by implication as performance
standards.
The best evidence of what the ponencia did when it saw matters
otherwise, is its own statement: its basis is not what the submitted
evidence state but on what she was “largely impelled” to recognize.
To quote the ponencia’s own words:
A punctilious examination of the records reveals that Abbott had

indeed complied with the above requirements. This conclusion is
largely impelled by the fact that Abbott clearly conveyed to Alcaraz
her duties and responsibilities as Regulatory Affairs Manager prior
to, during the time of her engagement, and the incipient states of her
employment. On this score, the Court finds it apt to detail not only of
the incidents which point out to the efforts made by Abbott but also
those circumstances which would show that Alcaraz was well-
apprised of her employer’s expectations that would, in turn determine
her regularization:” [emphasis supplied]
The petitioner’s other pieces of evidence that the ponencia cited

and used to support its conclusion do not and cannot, however,
satisfy the requirement for performance standards that must be
communicated at the time of engagement.
Specifically, these were the Offer Sheet dated December 7,
2004, and the pre-employment orientation on the respondent’s
duty to implement the petitioner’s Code of Conduct, office policies
and training program.
732


The Offer Sheet was designed to inform the respondent of the
compensation and benefits package offered to her by the petitioner
and can in no way be read as a statement of the applicable
probationary employment standard.8 It was communicated even
prior to engagement when the parties were negotiating, not at the
point of engagement as the law requires.
The pre-employment orientation on the respondent’s duty to
implement the petitioner’s Code of Conduct, office policies and
training program likewise cannot be characterized as performance
standards; they simply related to activities aimed at acquainting and
training the respondent on her duties and not for the purpose of
informing her of the performance standards applicable to her. What
stands out is that they do not pertain specifically to the
respondent and the required performance standard applicable
for her qualification for regular employment; they related to the
staff the respondent managed and supervised. Additionally, these
were all relayed prior to or after the respondent was engaged by the
petitioner.
An important distinction to remember at this point is that the
respondent’s knowledge of the duties that her work entailed, and her
knowledge of the employer’s performance standard, are two distinct
matters separately requiring the presentation of independent proof.
The requirement of independent proof is found under Article 281
of the Labor Code, as amended, and its implementing rule that deem
an employee to be regular if he/she was not informed of the
performance standard for regularization. Independent proof is
likewise necessary as the law provides an additional ground for
terminating a probationary employment, i.e., when the employee
“fails to qualify as a
_______________
8Id. at p. 77.
733
VOL. 701, JULY 23, 2013 733

regular employee in accordance with the reasonable standards

made known by the employer[.]”9
The performance standard contemplated in law may be proven by
evidence of how the employee’s performance was intended to be or
was, in fact, measured by the employer. The performance standard
may be in the form of a clear set of the employer’s expectations, or
by a system of feedbacks (e.g., comment cards) and document
evaluation or performance evaluation and appraisals conducted by
the employer.
These were the pieces of evidence that the NLRC, as
confirmed by the CA, did not see in the evidence or in the
petitioners’ presented case. The ponencia, unfortunately, glossed
over these gaps and omissions in the petitioners’ case and chose to
believe, even without evidentiary basis that—
Considering the totality of the above-stated circumstances, it

cannot, therefore, be doubted that Alcaraz was well-aware that her
regularization would depend on her ability and capacity to fulfill the
requirements of her position as Regulatory Affairs Manager and that
her failure to perform such would give Abbott a valid cause to
terminate her probationary employment. [emphasis supplied]
From this strained and stretched reading that magically saw the
required prescribed performance standards that — by the factual
findings of the NLRC and the CA — never existed, the ponencia
went on to conclude:
Verily, basic knowledge and common sense dictate that the

adequate performance of one’s duties is, by and of itself, an inherent
and implied standard for a probationary employee to be regularized;
such is a regularization standard which need not be literally spelled
out or mapped into technical indicators in every case. In this
_______________
9 See Article 281 of the Labor Code, as amended.
734

regard, it must be observed that the assessment of adequate duty

performance is in the nature of a management prerogative which
when reasonably exercised — as Abbott did in this case — should be
respected. This is especially true of a managerial employee like
Alcaraz who was tasked with the vital responsibility of handling
personnel and important matters of her department.
This conclusion, of course, simply extends the magic by using

“basic knowledge and common sense” to dictate the existence of
“inherent and implied standards” of a probationary employee, and
even offers a view of “management prerogative” that is unusual in
the given facts of this case. This approach eloquently exemplifies
what I mentioned above as the “solving backwards” approach that
the ponencia used.
II.A.2(b). No specific performance standard
communicated to the respondent.
Complementing the requirement for the existence of performance
standards is the required communication of the performance
standard to the respondent. Again, nothing in the records shows that
the petitioner ever communicated any performance standard to the
respondent.
The ponencia, in building up a case contrary to what the NLRC
and the CA found, cites the evidence the petitioners point to — the
respondent’s receipt of copies of the petitioner’s Code of Conduct,
Probationary Performance Standards and Evaluation, and
Performance Excellence Orientation Modules. The NLRC and the
CA, looking at the same pieces of evidence, saw these in a different
light as they did not only examine the documents themselves but
went to the extent of examining and appreciating the
circumstances surrounding the respondent’s receipt of these
documents.
The evidence on record suggests, as the respondent directly
testified to, that the cited documents were not given to her for the
purpose of complying with the petitioner’s obligation to
736

inform her of the performance standards applicable to her. The

documents were, in fact, given by the petitioner to assist her in
monitoring the employees assigned to her department, i.e., as the
documents she must rely on in conducting the performance
evaluations of the staff assigned to her department. In short, the
respondent received the documents because they were necessary in
the discharge of her functions.
From the point of law, compliance with the first requirement is
not also satisfied by the petitioner’s assertion that the respondent
knew that only one performance standard applied to all employees.
Notably, the law requires proof that the employer specifically made
known to her the performance standards applicable to her to enable
her to qualify for regular employment. The required
communication must be an effective one if the law were to be
given meaningful substance, not a mere perfunctory
transmission of information.
Faced with these opposing claims, the CA apparently weighed
matters in the respondent’s (and effectively in the NLRC’s) favor. In
this situation of possible equipoise, the CA did not rule incorrectly
from the point of law when it acted as it did.
Two factors tilt the balance in favor of the legal correctness of
the CA’s ruling. The first is that the respondent’s position (found by
the NLRC to be meritorious) was not without any basis in fact and
in law. The second is from the latter perspective; Article 4 of the
Labor Code and established jurisprudence hold that any doubt in a
labor situation must be resolved in the employee’s favor.
Thus, again, the ponencia’s case and its conclusion must fail.
II.A.2(c). Performance standards and the
internal procedures for their
evaluation were not applied to the
respondent.
736


I can only agree with one aspect of the ponencia — its admission
that Abbott’s internal procedures were not applied to the respondent.
I cannot dispute and I fully agree with the following passages of the
ponencia:
Records show that Abbott’s PPSE procedure mandates, inter alia,

that the job performance of a probationary employee should be
formally reviewed and discussed with the employee at least twice:
first on the third month and second on the fifth month from the date
of employment. Abbott is also required to come up with a
Performance Improvement Plan during the third month review to
bridge the gap between the employee’s performance and the
standards set, if any. In addition, a signed copy of the PPSE form
should be submitted to Abbott’s HRD as the same would serve as
basis for recommending the confirmation or termination of the
probationary employment.
In this case, as it is apparent that Abbott failed to follow the
above-stated procedure in evaluating Alcaraz. For one, there lies a
hiatus of evidence that a signed copy of Alcaraz PPSE form was
submitted to the HRD. It was not even shown that a PPSE form was
completed to formally assess her performance. Neither was the
performance evaluation discussed with her during the third and fifth
months of her employment. Nor did Abbott come up with the
necessary Performance Improvement Plan to properly gauge Alcaraz
performance with the set company standards.
While it is Abbott’s management prerogative to promulgate its
own company rules and even subsequently amend them, this right
equally demands that when it does create its own policies and
thereafter notify its employees of the same, it accords upon itself the
obligation to faithfully implement them. Indeed, a contrary
interpretation would entail a disharmonious relationship in the work
place for the laborer should never be mired by the uncertainty of
flimsy rules in which the latter’s
737
VOL. 701, JULY 23, 2013 737

labor rights and duties would, to some extent, depend.10 [footnotes in

the original omitted]
Internal processes, however, cannot be dissociated from the

substance that the processes seek to achieve. This is the essence of
due process. There is the requirement for the observance of proper
procedures, hand in hand with the substance of what the law seeks –
to level the playing field between the all-powerful employer and the
vulnerable employee who lies at the mercy of the employer if he or
she can be dismissed on the basis of the latter’s whim. This attempt
at leveling is the reason for the requirements for duly disclosed
performance standards and their communication to the probationary
employee at the very beginning of the relationship. Reason,
experience and common sense dictate that the substance of the law
carry more weight than the process component so that any violation
of the substantive portion is a transgression that mere obeisance to
the process or the recognition of the failure of process, cannot cure.
From this perspective, the laudable quotation above loses its luster.
Lusterless or otherwise, the ponencia’s admission of Abbott’s
procedural inadequacies is not without significance in terms of the
present case as a whole. Notably, the above quotation expressly and
impliedly admits that no effort at all was ever made for the conduct
of an assessment or evaluation of the respondent’s performance; in
fact, no performance evaluation forms appear to have been
submitted by the company. The dearth of evidence on this point
(described by the ponencia as a “hiatus of evidence”) is completely
consistent with what the ponencia explicitly and impliedly admits
from the very beginning: there was no evidence of any performance
standard furnished the respondent so that the ponencia could only
deduce the existence of performance standards from its
assumptions and stretched rationalizations; much less was there
any communica-
_______________
10 Decision, at pp. 16-17.
738

tion of performance standards qua performance standards, as this

is a matter that was also assumed.
I draw attention, too, to another unusual feature of this case
indicating, not only the omissions that the ponencia already cited,
but the implication as well that the respondent had been singled out
for special treatment by the petitioner officers. At the very least, this
incident indicates that the petitioner did not apply the same
standards and processes to the respondent’s work. The petitioner’s
prescribed procedure was narrated in an earlier version of the
ponencia in this wise:
On April 20, 2005, Alcaraz had a meeting with petitioner Cecille

Terrible (Terrible), Abbott’s former HR Director, to discuss certain
issues regarding staff performance standards. In the course x x x
thereof, Alcaraz accidentally saw a printed copy of an e-mail sent by
Walsh to some staff members which essentially contained queries
regarding the former’s job performance. Alcaraz asked if Walsh’s
action was the normal process of evaluation. Terrible said that it
was not.11 (emphasis ours)
This allegation by the respondent in this regard in her pleadings

was impliedly admitted by the petitioner when it failed to offer any
refutation. Interestingly, the above allegation was included in the
narration of facts of the Labor Arbiter, the NLRC, the CA and an
earlier version of the ponencia, although they arrived at two (2)
different conclusions.
The respondent’s unrefuted allegation was not considered at all in
the conclusions of the Labor Arbiter and of the ponencia.12 On the
other hand, the NLRC and the CA concluded that a different
performance standard and evaluation process
_______________
11 Pages 4-5 of the ponencia.
12 Ibid.; Rollo, pp. 260 and 271.
739
VOL. 701, JULY 23, 2013 739

was applied to the respondent in light of the circumstances of the

case, gleaned from the evidence submitted.13
In my view, the NLRC and the CA were not without basis in
making their conclusion as the incident, taken together with the facts
supported by the available evidence, is vital in appreciating the
nature of the respondent’s employment.
Since the respondent, as the incident suggests, was bound by a
different set of standards and procedures, and since no evidence of
record existed showing what these standards were or that the
required procedures were observed, the petitioners’ theory that the
respondent was informed of, and was evaluated pursuant to, the
performance standards applicable to her position, is effectively
negated. This leads to the conclusion that the respondent, from the
beginning, had been a regular employee as a result of the failure
of Abbott’s HR processes. A much simpler view, related this time to
the manner of her termination, is that the respondent was simply
differently treated.
B. “Just Cause” for Dismissal Must Exist
To justify the dismissal of an employee, the employer carries the
burden of proving that the dismissal was for a just cause and with
the observance of due process prior to dismissal.14 The employer has
to discharge this burden by clear, accurate, consistent and
convincing evidence;15 in case of doubt, the presumption in the
employee’s favor under Article 4 of the Labor Code should apply.
II.B.1. The petitioner had no valid cause to
dismiss the respondent’s employment
_______________
13 Rollo, pp. 1044-1045.
14 Aliling v. Feliciano, G.R. No. 185829, April 25, 2012, 671 SCRA 186, 205.
15 Ibid.
740


The respondent was dismissed as she “failed to qualify as regular
employee in accordance with the prescribed standards set by the
Company.”16 Even granting for the sake of argument that the
petitioner had apprised the respondent of an applicable performance
standard, the evidence failed to show that the respondent did not
meet this standard in a manner and to the extent equivalent to the
“just cause” that the law requires.
II.B.1(a). Just cause requirement for
employees, whether
probationary or regular.
An important legal point that should not be lost in considering
this case is that a probationary employee does not have lesser
rights than a regular employee under the Labor Code in terms
of the just cause for the termination of an employment. While the
strict application of Article 282 of the Labor Code may be relaxed
because the employee is still under probation (so that analogous
probationary status rules may apply), the same essential just cause
for dismissal must be present and must be proven. In other words,
probationary employment does not mean that the employee is under
an “employment at will” situation as that phrase is understood in
American jurisprudence. To reiterate, the fact that the respondent
was still in her probationary period of employment did not lessen the
burden of proof that the law imposed on the petitioners to prove the
just cause for her dismissal.17 Probationary employees are protected
by the security of tenure provision of the Constitution and they
cannot be removed from their position except only for cause.18
_______________
16 Rollo, p. 78.
17 Aberdeen Court, Inc. v. Agustin, Jr., 495 Phil. 706, 712; 456 SCRA 32, 38
(2005).
18 Ibid.
741
VOL. 701, JULY 23, 2013 741

II.B.1(b). The evidentiary status of the
just cause for dismissal
In the present case, the evidence did not show the just cause that
Article 282 of the Labor Code requires. No evidence on record
showed the commission by the respondent of any of the following
acts or omissions:
(a) Serious misconduct or willful disobedience by the employee
of the lawful orders of his employer or representative in
connection with his work;
(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 representatives; and
(e) Other causes analogous to the foregoing.
On the contrary, the records disclose that the respondent
performed her duties under the guidance of the petitioner’s
management and worked in line with the tasks assigned to her.19 The
petitioner’s allegation of the respondent’s “poor performance” could
not have been substantiated considering the lack of any clear
performance standard in evaluating the respondent’s work.
II.B.2. The petitioner violated its own
procedural requirements in the
performance evaluation
A first instance when the discussion related to “process” was
with respect to the communication of performance
_______________
19 See page 4 of the ponencia.
742

standards. This topic also relates to process, but this time on the
matter of the procedure to be taken in performance evaluation: the
petitioner failed to observe its own procedural requirements in
evaluating the respondent’s probationary employment.
The petitioner’s prescribed procedure gives probationary
employees two (2) opportunities to meet and qualify for
regularization. As mentioned before, the reviews were aimed at
informing the employees of their work performance based on the
petitioner’s standard and on how they can improve it to qualify for
regularization. For reasons not disclosed in the records, the
prescribed procedure was not followed by the petitioner in the
respondent’s case. She was immediately terminated from
employment without having been evaluated and without undergoing
the evaluation process under the petitioner’s prescribed procedure.
While the petitioner’s failure to observe its own procedures is not
disputed in the ponencia, the implication of Abbott’s failure cannot
simply be glossed over. Abbott’s non-compliance should be viewed
from the point of fairness or lack of it, that attended the
respondent’s dismissal. This circumstance should be considered
together with the other circumstances of the case, if only because the
petitioner’s basic unfairness rendered doubtful the real cause in the
termination of her employment.
In other words, any deviation from the prescribed procedures
must be sufficiently explained to remove doubts on the genuineness
of the cause of dismissal. In this case, not only did the petitioner fail
to observe its own prescribed procedure; more importantly, it also
failed to provide an explanation on why the prescribed procedure
was not followed in the respondent’s case.
Significantly, the NLRC appreciated all these in this case and
this appreciation was duly noted and evaluated by the CA. As
there was in fact basis in fact and in law in the NLRC’s findings
on this aspect of the case,
743
VOL. 701, JULY 23, 2013 743

again the CA correctly found no grave abuse of discretion in the

NLRC’s actions.
II.B.3. Violation of the Labor Code’s
procedural requirements
Additionally, the petitioner failed to comply with the procedural
due process of the Labor Code when it terminated the respondent’s
employment. The two-written notice requirement under Section 2,
Rule XXIII, Book V of the Omnibus Rules Implementing the Labor
Code, as amended, was never observed. To quote this provision:
Section 2. Standards of due process; requirements of notice.—In

all cases of termination of employment, the following standards of
due process shall be substantially observed:
I. For termination of employment based on just causes as defined in
Article 282 of the Code:
(a) A written notice served on the employee specifying the
ground or grounds for termination, and giving to said employee
reasonable opportunity within which to explain his side;
(b) A hearing or conference during which the employee
concerned, with the assistance of counsel if the employee so desires,
is given opportunity to respond to the charge, present his evidence or
rebut the evidence presented against him; and
(c) A written notice of termination served on the employee
indicating that upon due consideration of all the circumstance[s],
grounds have been established to justify his termination.
In case of termination, the foregoing notices shall be served on the
employee’s last known address. [emphasis supplied]
744

The first notice is complied with when the employee is properly

apprised of the charges brought against him/her so that he/she can
properly prepare for his/her defense.20 The second notice is
complied with when the employee is informed of the employer’s
intention to terminate the employment.21 A formal “trial-type”
hearing, although preferred, is not absolutely necessary to satisfy the
employee’s right to be heard. In Perez v. Philippine Telegraph and
Telephone Company,22 the Court laid down the following 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.
From the records, the respondent received only one notice and
was not given ample opportunity to be heard before her
employment was terminated. The respondent was not served a first
written notice indicating: (1) the grounds for terminating her
employment; and (2) a directive giving her the opportunity to submit
a written explanation within a
_______________
20 Dolores T. Esguerra v. Valle Verde Country Club, Inc., et al., G.R. No. 173012,
June 13, 2012, 672 SCRA 177.
21 Ibid.
22 G.R. No. 152048, April 7, 2009, 584 SCRA 110, 127.
745
VOL. 701, JULY 23, 2013 745

reasonable period. Neither was the respondent given the ample

opportunity to be heard as required by law. There was only
compliance with the second notice requirement through the
petitioner’s letter dated May 19, 2005 which was already a written
notice of termination of employment.23
In defense of Abbott’s failure to observe the two-notice
requirement, the ponencia argues that a different procedure applies
when terminating a probationary employee; the usual two-notice
requirement does not govern, citing for this purpose Section 2, Rule
I, Book VI of the Implementing Rules of the Labor Code.
The ponencia, however, forgets that the single notice rule applies
only if the employee is validly on probationary basis; it does not
apply where the employee is deemed a regular employee for the
company’s failure to provide and to communicate a prescribed
performance standard applicable to the probationary employee.
The ponencia itself admits that in such a case, the employee would
then be a regular employee. Since the petitioner utterly failed to
support by evidence its compliance with the legal requirements on
performance standards, the two-notice requirement for regular
employees must perforce fully apply.
C. The Consequences of the Respondent’s
Illegal Dismissal
The above analysis shows that the respondent had been illegally
dismissed from her employment. The petitioner failed to show that
her dismissal was for a valid cause. The petitioner also failed to
respect the respondent’s procedural due process rights under the law.
As a consequence, the NLRC and the CA, thereafter, correctly
ordered the respondent’s reinstatement and the payment of the
monetary awards of backwages, moral damages,
_______________
23 Rollo, p. 78.
746

exemplary damages and attorney’s fees. The CA and the NLRC also
correctly held that the individual petitioners (i.e., the corporate
officers of the petitioner) should be solidarily liable with the
petitioner for the respondent’s monetary awards.
II.C.1. The recoverable reliefs
Article 279 of the Labor Code, as amended, provides the
following awards to an illegally dismissed employee:
Art. 279. Security of tenure.—In 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. An employee who is
unjustly dismissed from work shall be entitled to reinstatement
without loss of seniority rights and other privileges and to his full
backwages, inclusive of allowances, and to his other benefits or their
monetary equivalent computed from the time his compensation was
withheld from him up to the time of his actual reinstatement.
“By jurisprudence derived from [the above] provision, separation

pay may be awarded to an illegally dismissed employee in lieu of
reinstatement.”24 Under Section 4(b), Rule I of the Rules
Implementing Book VI of the Labor Code, separation pay is
awarded, in lieu of reinstatement, to an illegally dismissed employee
when reinstatement is no longer possible, i.e., when the dismissed
employee’s position is no longer available, or the continued
relationship between the employer and the employee would no
longer be viable due to the strained relations between them, or when
the dismissed employee opts not to be reinstated, or when the
payment of sepa-
_______________
24 Session Delights Ice Cream and Fast Foods v. Court of Appeals (Sixth
Division), G.R. No. 172149, February 8, 2010, 612 SCRA 10, 25, citing Mt. Carmel
College v. Resuena, G.R. No. 173076, October 10, 2007, 535 SCRA 518, 541.
747
VOL. 701, JULY 23, 2013 747

ration benefits would be for the best interest of the parties involved.
“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.”25
II.C.2. Other awards as a consequence of the
damages suffered
In addition to these basic awards, an illegally dismissed
employee may also be awarded moral and exemplary damages and
attorney’s fees. Jurisprudence holds that moral and exemplary
damages are awarded when the illegal dismissal is attended by bad
faith.26 The Court has also ruled that corporate officers are solidarily
liable with the employer company for the employees’ termination of
employment done with malice or bad faith.27
A review of the facts of the case shows ample evidence
supporting the petitioner’s bad faith, as shown by the manner in
which the respondent’s employment was terminated. The NLRC, in
its decision, exhaustively discussed the petitioner’s bad faith, as
demonstrated by the actions of the individual petitioners:
_______________
25 Macasero v. Southern Industrial Gases Philippines, G.R. No. 178524, January
30, 2009, 577 SCRA 500, 507.
26 Nazareno v. City of Dumaguete, G.R. No. 177795, June 19, 2009, 590 SCRA
110, 141-142. See also Civil Code, Articles 2208, 2217, 2219 and 2232.
27 MAM Realty Development Corporation v. NLRC, G.R. No. 114787, June 2,
1995, 244 SCRA 797, 803.
748

The records show that complainant-appellant’s dismissal was

effected by individual respondents-appellees in a capricious and
high-handed manner, anti-social and oppressive, fraudulent and in
bad faith, and contrary to morals, good customs and public policy.
Bad faith and fraud are shown in the acts committed by respondents-
appellees before, during and after complainant-appellant’s dismissal
in addition to the manner by which she was dismissed. First,
complainant-appellant was pressured to resign: (1) she was
threatened with termination, which will surely damage her reputation
in the pharmaceutical industry; (2) she was asked to evacuate her
Commission and ordered not to enter the Company’s premises even
if she was still an Abbott employee; and (3) individual respondents
Ms. Terrible and Ms. Walsh made a public announcement to the staff
that complainant-appellant already resigned even if in reality she did
not. All of which caused complainant-appellant much humiliation,
serious anxiety and besmirched reputation.28
The CA also described in detail the abrupt and oppressive manner

in which the respondent’s employment was dismissed by the
petitioner:
On May 23, 2005, the private respondent still reported for work since
petitioner Abbott had not yet handed the termination notice to her.
However, the security guard did not allow her to enter the Hospira
ALSU office pursuant to Ms. Walsh[‘s] instruction. She requested
Ms. Walsh that she be allowed to enter the company premises to
retrieve her last remaining things in her office which are mostly her
personal belongings. She was allowed to enter. However, she was
surprised to see her drawers already unlocked and, when she opened
the same, she discovered that her small brown envelope x x x, white
pouch containing the duplicate keys, and the staff’s final evaluation
sheets were missing. The private respondent informed Ms. Bernardo
about the incident. The latter re-
_______________
28 Rollo, pp. 375-376.
749
VOL. 701, JULY 23, 2013 749

sponded by saying she was no longer an employee of the company

since May 19, 2005.
The private respondent reported the matter to the Pasig Police
Station and asked for help regarding the theft of her properties. The
Pasig Police incident report stated as follows:
x x x x
When confronted by the suspect, in the presence of one
SOCO officer and staff, named Christian Perez. Kelly Walsh
allegedly admitted that she was the one who opened the
drawer and got the green folders containing the staff
evaluations. The Reportee, was told by Kelly Walsh that her
Rolex wristwatch will be returned to her provided that she will
immediately vacate her office.
On the same date, the private respondent’s termination letter dated
May 19, 2005 was handed to her by Ms. Walsh, Mr. Almazar and Ms.
Bernardo. On May 27, 2005, the private respondent received another
copy of the said termination notice via registered mail.29
These explanations for the actions taken show that the

NLRC’s recognition of the bad faith was not without basis and
was in fact supplemented by the CA in the appellate court’s own
confirmatory explanation.
D. Application of the Rule 45 Standard of Review
Under the evidentiary situation that prevailed in this case as
described above in some detail, an expression of wonder cannot be
helped, particularly on how the ponencia could conclude that the CA
committed a reversible error when it found no grave abuse of
discretion in the NLRC’s actions on the case. In contrast with the
findings of the Labor Arbiter, the findings and conclusions of the
NLRC, as affirmed on a Rule 65 review by the CA, were based on
the law and juris-
_______________
29 Id., at pp. 1046-1047.
750

prudence as properly applied to the established set of facts and

evidence.
First, while the respondent, from the petitioner’s standpoint, was
hired as a probationary employee, she was deemed a regular
employee pursuant to the clear provisions of Article 281 of the
Labor Code, as amended and Section 6(d) of the Implementing
Rules of Book VI, Rule I of the Labor Code, as amended. The
evidence adduced failed to show that the petitioner ever apprised the
respondent at the time of her engagement of the standards she must
meet to qualify for regular employment.
Second, the respondent’s termination from employment had no
basis in fact and in law. Since the records failed to support the
petitioner’s allegation that the respondent’s alleged poor
performance and tardiness were proven by evidence and, in fact, fell
within the enumeration in Article 281 and Article 282 of the Labor
Code, reason dictates that the present petition be denied.
At the risk of repetition, the adduced evidence, in the first place,
did not prove that the respondent’s work failed to comply with the
petitioner’s performance standard as no proof of the performance
standard applied to the respondent’s work was actually presented.
The respondent’s employment was also terminated without
undergoing any performance evaluation.
The evidence adduced did not also prove any act of omission
under Article 282 of the Labor Code committed by the respondent.
No evidence was presented on the respondent’s actual work so as to
determine whether her acts/omissions constituted a just cause for
termination, such as serious misconduct or gross or habitual neglect
of duty or any other analogous cause to the just causes mentioned in
the law.
As the records show, neither was there compliance with the
respondent’s own internal procedures nor with the law’s procedural
due process. The respondent was not served the two-
751
VOL. 701, JULY 23, 2013 751

notice required by law before her employment was terminated by the

petitioner.
Third, the NLRC’s monetary awards, as affirmed by the CA,
were appropriate consequences of the respondent’s illegal dismissal
from employment. The payment of the respondent’s backwages and
the order of reinstatement were consistent with the provisions of
Article 279 of the Labor Code. Jurisprudence also provides the
award of moral and exemplary damages, as well as attorney’s fees,
when bad faith is proven in the termination of employment.
In this case, the bad faith exhibited by the individual petitioners
was clearly established in the records. The individual petitioners’
bad faith was demonstrated by the evidence of how they unfairly
effected the termination of the respondent’s employment.
The narration of facts of the Labor Arbiter, the NLRC and the
CA shows, among others, that: (1) the individual petitioners did not
follow the petitioner’s prescribed procedure performance evaluation
as, in fact, the respondent’s work was not evaluated; (2) the
individual petitioners, through their concerted actions, ganged up on
the respondent in forcing her to resign from employment; (3) the
individual petitioners pressured the respondent to resign by
announcing her resignation to the office staff, thereby subjecting her
to unwarranted humiliation; and (4) they blackmailed the respondent
by withholding her personal possessions until she resigned from
employment.
Bad faith can also be inferred from the lack of fairness and
underhandedness employed by the individual petitioners on how
they informed the respondent of the termination of her employment.
The records disclose that the respondent was lured into a meeting on
the pretext that her work performance was to be evaluated; she was
caught off-guard when she was informed that her employment had
been terminated. Aside from the abrupt notification, bad faith can
also be deduced from the fact that the termination was made
immedi-
752

ately effective; the respondent was immediately banned from the

petitioner’s premises after she was informed that her employment
had been terminated.
To my mind, the NLRC correctly ruled that the individual
petitioners were solidarily liable, together with the petitioner, to pay
the monetary awards. The cited circumstances constitute sufficient
evidence of their bad faith in terminating the respondent’s
employment. Verily, corporate officers are solidarily liable with the
corporation to pay monetary awards in illegal dismissal cases when
their bad faith is established in the termination of the employment.
III. Conclusion
I close this Dissent with the note that the constitutional protection
of security of tenure is a right enjoyed by every employee.
Employment, regardless of the employment status, may only be
terminated for cause and within the procedure prescribed by law and
jurisprudence. A review of the records shows that no reversible error
was committed by the CA in finding the NLRC free from any taint
of grave abuse of discretion in ruling on the respondent’s illegal
dismissal. This conclusion is what the Court should reflect in its
Decision if it is to discharge in good faith its duty to adjudicate.
Petition granted, judgment and resolution reversed and set aside.
Notes.—A person whose right to remain in peaceful possession

of his property is violated by another person’s fraudulent registration
of such property in her name is entitled to nominal damages under
Article 2221 of the Civil Code. (Reyes vs. Montemayor, 598 SCRA
61 [2009])
The filing of a certificate of non-forum shopping is mandatory so
much so that non-compliance could only be tolerated by special
circumstances and compelling reasons; This Court has held that
when there are several petitioners, all of them
753
VOL. 701, JULY 23, 2013 753

must execute and sign the certification against forum shopping;

otherwise, those who did not sign will be dropped as parties to the
case. (Pigcaulan vs. Security and Credit Investigation, Inc., 663
SCRA 1 [2012])
——o0o——
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Abbott Laboratories, Et Al. v. Alcaraz, G.R. No. 192571, July 23, 2013

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Abbott Laboratories, Et Al. v. Alcaraz, G.R. No. 192571, July 23, 2013

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G.R. No. 192571. July 23, 2013.

ABBOTT LABORATORIES, PHILIPPINES, CECILLE A.

Remedial Law; Civil Procedure; Forum Shopping; Certification

VOL. 701, JULY 23, 2013 683

Abbott Laboratories, Philippines vs. Alcaraz

(2002), the Court explained that: x x x The distinction between the

684 SUPREME COURT REPORTS ANNOTATED

Abbott Laboratories, Philippines vs. Alcaraz

probationary employment, aside from just or authorized causes of

VOL. 701, JULY 23, 2013 685

Abbott Laboratories, Philippines vs. Alcaraz

employee when it has exerted reasonable efforts to apprise the employee of

686 SUPREME COURT REPORTS ANNOTATED

Abbott Laboratories, Philippines vs. Alcaraz

of termination.—A different procedure is applied when terminating a

VOL. 701, JULY 23, 2013 687

Abbott Laboratories, Philippines vs. Alcaraz

688 SUPREME COURT REPORTS ANNOTATED

Abbott Laboratories, Philippines vs. Alcaraz

VOL. 701, JULY 23, 2013 689

Abbott Laboratories, Philippines vs. Alcaraz

absence of grave abuse of discretion on the part of the National Labor

690 SUPREME COURT REPORTS ANNOTATED

Abbott Laboratories, Philippines vs. Alcaraz

by the employer to the employee at the time of his engagement. An

VOL. 701, JULY 23, 2013 691

Abbott Laboratories, Philippines vs. Alcaraz

PETITION for review on certiorari of the decision and resolution of

692 SUPREME COURT REPORTS ANNOTATED

101045 which pronounced that the National Labor Relations

VOL. 701, JULY 23, 2013 693

was to be employed on a probationary basis.8 Later that day, she

694 SUPREME COURT REPORTS ANNOTATED

During Alcaraz’s pre-employment orientation, petitioner Allan

VOL. 701, JULY 23, 2013 695

control and supervision of Walsh; and (f) the processing of

696 SUPREME COURT REPORTS ANNOTATED

This shall form the basis for recommending the confirmation or

698 SUPREME COURT REPORTS ANNOTATED

inform her of the reasonable standards for her regularization upon

VOL. 701, JULY 23, 2013 699

evaluating all types of Abbott employees.31 As Alcaraz was unable

WHEREFORE, the Decision of the Labor Arbiter dated 31 March

700 SUPREME COURT REPORTS ANNOTATED

VOL. 701, JULY 23, 2013 701

Aggrieved, petitioners filed with the CA a Petition for Certiorari

702 SUPREME COURT REPORTS ANNOTATED

VOL. 701, JULY 23, 2013 703

cember 10, 2009 Decision i.e., the decision in the First CA

x x x The distinction between the prohibition against forum

704 SUPREME COURT REPORTS ANNOTATED

shopping is separate from and independent of the avoidance of the

As to the first, forum shopping takes place when a litigant files

VOL. 701, JULY 23, 2013 705

the petitioners. Based on the foregoing, a judgment in the Second

706 SUPREME COURT REPORTS ANNOTATED

missal is at issue whereas in the said Memorandum of Appeal, the

VOL. 701, JULY 23, 2013 707

sonable standards upon which the regularization would be based on

(d) In all cases of probationary employment, the employer shall

In other words, the employer is made to comply with two (2)

708 SUPREME COURT REPORTS ANNOTATED

which there is no need to spell out a policy or standard to be met. In