Labor 1 A2015 Compilation of Cases (FINALS)

LABOR CASE FINALS REVIEWER CASE Phil Telegraph and Telephone Co v. NLRC

Duncan Association of Detailman v. Glaxo Wellcome

QUICK FACTS

HELD

DOCTRINE

Working Conditions for Special Group of Workers Respondent was terminated from Petitioner’s policy of not accepting Constitution, cognizant of the employment as it was company or considering as disqualified form disparity in rights between men policy not to hire married women. work any woman worker who and women in almost all phases of Respondent, who'd been employed contacts marriage VIOLATES right social and political life, provide a for some time under company denied against discrimination against gamut of protective provisions (Sec that she knew of the policy and women 14 Art II, Sec 3 Art XII, Sec 14 Art insisted she did not conceal her civil XIII). Corrective labor and social status laws on gender inequality have emerged with more frequency in the years since the LC was enacted, Labor Code Articles 130-138 recognizes this too. Acknowledged as paramount in the due process scheme is the constitutional guarantee of protection to labor and security of tenure. Thus, an employer is required as a condition prior to severance of the employment ties of an individual under his employ, to convincingly establish through substantial evidence, the existence of a valid and just cause in dispensing with the services of such employee, one’s labor being regarded as constitutionally protected property Company had a policy that required VALID COMPANY POLICY Valid exercise of management employees to disclose to prerogative. Glaxo has a right to management, any existing or future guard its trade secrets, relationship by consanguinity or manufacturing formulas, marketing affinity with co employees or strategies and other confidential employees of competing drug programs and information from companies and should management competitors, especially so that it find that such relationship poses a and Astra are rival companies in possible conflict of interest, that such highly competitive pharmaceutical employee should resign from the industry. company. Petitioner entered into a romantic relationship with an employee of Astra, competitor of respondent company. Before they

OTHER NOTES Petitioner’s policy is not only in derogation of the provisions of Art 136 on the right of a woman to be free from any kind of stipulation against marriage in connection with her employment, but it likewise assaults good morals and pulic policy, tending as it does to deprive a woman of the freedom to choose her status, a privilege that by all accounts inheres in the individual as an inalienable right

Policy does not violate EPC of Constitution. EPC: no shield against private conduct. Glaxo does not impost absolute prohibition against relationships between employes and competitor companies, what it seeks to avoid is conflict of interest between the employee and the company that may arise about such relationship.

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Philip. Aeolus Automotive United Corp v. NLRC

Libres v. NLRC

Fernando Co v. Lina B. Vargas

married, petitioner received reminders from his District Manager regarding conflicts of interest. He requested time to comply with company policy, Glaxo transferred petitioner to different sales area. Respondent was sexually harassed by her boss over a period of 4 years. She finally snapped after her boss transferred her to an office without and intercom or telephone. CA questioned why it took her 4 years to reveal said sexual harassment.

Petitioner was dismissed for sexually harassing a co-worker pursuant to Item 2, Table V, of the Plant’s Rules and Regulations and the Manual of the Philippine Daily Inquirer in defining sexual harassment. He argues that the court should apply RA No. 7877 (Anti-Sexual Harassment Act) in determining whether he actually committed sexual harassment. He cites public respondent’s failure to show that his acts of fondling the hand and massaging the shoulders of Capiral “discriminated against her continued employment,” “impaired her rights and privileges under the Labor Code,” or “created a hostile, intimidating or offensive environment.” Respondent was working as a baker in his employer's bakeshop while she

Respondent is entitled to damages due to the sexual harassment she suffered under her employer --> There is no time period within which he or she is expected to complain;. the time to do so may vary depending upon the needs, circumstances, and more importantly, the emotional threshold of the employee.

The gravamen of the offense in sexual harassment is not the violation of the employee's sexuality but the abuse of power by the employer. Sexual harassment is an imposition of misplaced "superiority" which is enough to dampen an employee's spirit in her capacity for advancement. It affects her sense of judgment; it changes her life.

RA 7877 was not yet in effect at the time of the occurrence of the act complained of. As a rule, laws shall have no retroactive effect unless otherwise provided, or except in a criminal case when their application will favor the accused. Hence, the Labor Arbiter have to rely on the MEC report and the common connotation of sexual harassment as it is generally understood by the public.

Villarama case: "As a managerial employee, petitioner is bound by more exacting work ethics. He failed to live up to his higher standard of responsibility when he succumbed to his moral perversity. And when such moral perversity is perpetrated against his subordinate, he provides a justifiable ground for his dismissal for lack of trust and confidence. It is the right, nay, the duty of every employer to protect its employees from oversexed superiors.”

Thus, for the anxiety, the seen and unseen hurt that she suffered, petitioners should also be made to pay her moral damages, plus exemplary damages, for the oppressive manner with which petitioners effected her dismissal from the service, and to serve as a forewarning to lecherous officers and employers who take undue advantage of their ascendancy over their employees.

[I]t is clear that petitioner [Lina B. Vargas] is not a househelper or A2015 LABOR FINALS REVIEWER- Roe, Maan, Lindsey, Kimmie, Kor and Mica

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is also doing household chores for them. She was dismissed when she was not able to cook dinner for the employee's family.

Escasinas v. Shangri-la's Mactan Island Resort

Romares v. NLRC

Petitioners are registered nurses engaged by Dr. Pepito to work in her clinic located at respondent Shangrila. - A complaint for regularization, underpayment of wages, nonpayment of holiday pay, night shift differential and 13th month pay differential against respondents were filed by petitioners who claim that they are regular employees of Shangri-la pursuant to Article 157 of the Labor Code. Accordingly, Shangri-la is required to hire a full-time registered nurse, apart from a physician, hence, their engagement should be deemed as regular employment. Complainant in his Complaint and Position Paper alleged that he was hired by respondent in its Maintenance/Projects/Engineering Department during the periods of: Sept. 1, 1989 to Jan. 31, 1990 Jan.16, 1991 to Jun. 15, 1991 Aug. 16, 1992 to Jan. 15, 1993 Complainant argues that having rendered a total service of more than one (1) year and by operation of law, he has become a regular employee of respondent. Respondent on the other hand maintains that complainant was a former contractual employee of respondent

domestic servant of private respondents [Nathaniel Bakeshop and Fernando Co]. The evidence shows that petitioner is working within the premises of the business of private respondent Co and in relation to or in connection with such business. Art. 157 does not require the engagement of full-time nurses as regular employees of a company employing not less than 50 workers. Shangri-la, which employs more than 200 workers, should provide or make available such medical and allied services to its employees, not necessarily to hire or employ a service provider.

EMPLOYEE CLASSIFICATION Construing Art. 280 LC, the phrase “usually necessary or desirable in the usual business or trade of the employer” should be emphasized as the criterion in the instant case. Facts show that petitioner’s work with PILMICO as a mason was definitely necessary and desirable to its business. PILMICO cannot claim that petitioner’s work as a mason was entirely foreign or irrelevant to its line of business in the production of flour, yeast, feeds and other flour products.

Article 157 must not be read alongside Art. 280 in order to vest employer-employee relationship on the employer and the person so engaged. The phrase “services of a full-time registered nurse” should thus be taken to refer to the kind of services that the nurse will render in the company’s premises and to its employees, not the manner of his engagement.

It is noteworthy that during each rehiring, the summation of which exceeded one (1) year, petitioner was assigned to PILMICO’s Maintenance/Projects/Engineering Department performing the same kind of maintenance work. Such a continuing need for the services of petitioner is sufficient evidence of the necessity and indispensability of his services to PILMICO’s business or trade.

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Phil Federation etc v. NLRC

Dante D de la Cruz v. Maersk Filipinas Crewing Inc

AtoK Big Wedge Co v. Jesus P Gison

and as such his employment was covered by contracts Private respondent Abril worked for and held various positions in PFCCI until she went on an 8-month leave to give birth to her daughter. Upon her return, she was assigned to contractual positions which, however, provided that she would be under probationary employment for 6 months. Abril filed a complaint for illegal dismissal upon the termination of her employment while PFCCI insisted that her dismissal was valid upon the termination of her contract as she was a casual or contractual employee.

De la Cruz was employed as an engineer on board one of Maersk’s vessels who was dismissed during his probationary status for his unsatisfactory performance. He subsequently filed a complaint for illegal dismissal while his former employer claimed that a probationary employee may be dismissed at any time during the probationary period for failure to live up to the employer’s expectations. Respondent was engaged as parttime consultant on retainer basis by petitioner through its Asst VP and Acting Resident Mgr. He assisted company's retained legal counsel with matters pertaining to the prosecution of cases against illegal

Abril became a regular and was no longer a casual or contractual employee after she had been allowed to work by PFCCI beyond her six-month probationary period. Also, the conflicting provisions in her employment contract saying that while she was a contractual employee, she was to undergo a probationary period was construed in her favor leading to a conclusion that she had indeed been regularized after her continued employment after the expiration of her probation. Consequently, she may only be dismissed pursuant to just or authorized causes as provided for under the Labor Code, which does not include the expiration one’s contract employment. While the court held that he was indeed illegally dismissed for lack of basis of his termination, it was held that he was not a regular employee at the time of his dismissal. As a seafarer, De la Cruz was not covered by the term regular employment as provided for under Art. 280 of the LC, pursuant to the cases of Brent School v. Zamora and Coyoca v. NLRC. NO EMPLOYER-EMPLOYEE RELATIONSHIP. NO ILLEGAL DISMISSAL

Regardless of the designation an employer may have conferred upon an employee’s employment status, an employee becomes regularized after having completed the probationary period and allowed to work thereafter.

Seafarers are considered contractual employees whose rights and obligations are governed primarily by the POEA Standard Employment Contract for Filipino Seamen (POEA Standard Employment Contract), the Rules and Regulations Governing Overseas Employment, and by Republic Act No. 8042, otherwise known as The Migrant Workers and Overseas Filipinos Act of 1995. Well-entrenched doctrine that the existence of such relationship is ultimately a question of fact and that findings of the LA and NLRC shall be accorded not only respect but even finality when supported by substantial evidence. Four fold

CA’s interpretation of Art 280: Length of service and petitioner’s repeated act of assigning respondent some tasks to be performed did not result to respondent’s entitlement to the rights

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Tomas Lao Construction v. NLRC

Beta Electric Corp v. NLRC

surface occupants within the area covered by the company's mineral claims. Also tasked to perform liaison work with several gov't agencies. respondent was not required to report to its office regularly. Received a monthly fee of P3000 delivered to him at his residence/local restaurant. This arrangement lasted 11 years. He requested company to register him with the SSS but company denied. Respondent employees alternately worked for petitioners Tomas Lao Corporation (TLC), Thomas and James Developers(T&J) and LVM Construction Corporation (LVM), altogether informally referred to as the “Lao Group of Companies.” Each one of the companies would allow the utilization of its employees by the other two. The employees were rehired after the completion of the project or project phase to which they were assigned. The employment contracts expressly described the construction workers as project employees whose employments were for a definite period, i.e the completion of the project. The workers refused to sign the contracts, contending that such designation was a scheme to prevent them from being regularized. Eventually, their services were terminated. A complaint for illegal dismissal was filed. Petitioner was hired as clerk typist in the company from December 1986 to January 1987. However, her contract was extended until June 1987. Afterwhich, she was dismissed without any due notice. The company claims that she is just a

test: (1) Selection and engagement; (2) Payment of wages (3) power of dismisal (4) control test: an employer-employee relationship exists where the right to control not only the end achieved but also the manner and means to be used in reaching that end

The repeated re-hiring and the continuing need for their services over a long span of time have undeniably made them regular employees. The intermission between their employment periods when they were not paid is not deemed separation from services but merely a leave of absence without pay until they are reemployed. The contracts were a scheme of petitioners to prevent respondents from being considered as regular employees.

and privileges of a regular employee. Said provision is not the yardstick for employment because it merely distinguishes between 2 kinds of employees for purposes of determining the right of an employee to certain benefits

Where the employment of project employees is extended long after the supposed project has been finished, the employees are removed from the scope of project employees and considered regular employees.

The petitioner cannot rightfully say that since the private respondent's employment hinged from contract to contract, it was ergo, "temporary", depending on the term of each agreement. Under the Labor Code, an employment A2015 LABOR FINALS REVIEWER- Roe, Maan, Lindsey, Kimmie, Kor and Mica

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contractual worker, thus, not entitled to any benefits.

Hanjin Heavy Industries & Const. Co v. Ibanez

Villa v. NLRC

Petitioners in this case were construction workersof Hanjin who filed a complaint for illegal dismissal after being laid-off following Hanjin’s reduction of its manpower due to the completion of its projects. Petitioners assert that they did not sign any employment contract stating that they were project employees.

Respondent NSC (steel mills) was charged with nonregularization of contractual employees. The issue here is whether the employees were casual or regular. Note that casual or temporary employees are not entitled to benefits enjoyed by regular employees other than the `parity’ on the security of tenure

may only be said to be temporary" "where [it] has been fixed for a specific undertaking the completion of or termination of which has been determined at the time of the engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season." The court held that they were to be considered as regular employees. According to the court, consent of the project employee to be designated as such is necessary. However, Hanjin failed to adduce proof that the petitioners signed employment contracts to the effect that they were project employees. In effect, the court had to rely on the doctrine that in illegal dismissal cases, the employer has the burden of proving with clear, accurate, consistent and convincing evidence that a dismissal was valid and that absent any other proof that the project employees were informed of their status as such, it will be presumed that they are regular employees in accordance with Clause 3.3(a) of D.O. No. 19, Series of 1993. The fact that petitioners worked for NSC under different project employment contracts for several years cannot be made a basis to consider them as regular employees, for they remain project employees regardless of the number of projects in which they have worked. Length of

Project employees - employees who are hired for carrying out a separate job, distinct from the other undertakings of the company, the scope and duration of which has been determined and made known to the employees at the time of the employment, are properly treated as project employees and their services may be lawfully terminated upon the completion of a project. The test to determine whether an employee is a project employee as provided for in Art. 280 is whether or not the project employees were assigned to carry out a "specific project or undertaking," the duration and scope of which were specified at the time the employees were engaged for that project. 2 kinds of projects which a business or industry may undertake: 1. a particular job or undertaking that is within the regular or usual business of the employer company, but which is distinct and separate, and identifiable as such, from the other undertakings of the

On Project Employment Contracts: The nature of the employment is determined by the factors set by law, regardless of any contract expressing otherwise. Labor contracts are imbued with public interest and therefore are subject to the

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clause.

William Uy Construction Corp v. Trinidad

Respondent was driver of company's service vehicle, dump truck and transit mixer for 16 years. He signed several employment contracts w the company that identified him as a project employee though he had always been assigned to work on one project after another with some intervals. Petitioner terminated him from work after it shut down operations due to lack of projects but respondent learned that although petitioner opened a project in Batangas, he was not hired for that project. Petitioner argues that respondent was a project construction worker whose employment was co-terminous with the completion of specific company

service is not the controlling determinant of the employment tenure of a project employee.

NOT REGULAR EMPLOYEE

company. 2. “a particular job or undertaking that is not within the regular business of the corporation. Such a job or undertaking must also be identifiably separate and distinct from the ordinary or regular business operations of the employer. The job or undertaking also begins and ends at determined or determinable times.”

The TEST for distinguishing a project employee from a regular employee is whether or not he has been assigned to carry out a “specific project or undertaking” with the duration and scope of his engagement specified at the time his service is contracted Generally, length of service provides a fair yardstick for determining when an employee initially hired on a temporary basis becomes a permanent one BUT this standard will not be fair if applied to the construction industry  construction industry cannot always guarantee work

police power of the State (Art 1700, CC). An employer is allowed by law to reduce the work force into a number suited for the remaining work to be done upon the completion or proximate accomplishment of the project. However, the law requires that, upon completion of the project, the employer must present proof of termination of the services of the project employees at the nearest public employment office. If the employees’ services are extended long after the supposed project had been completed, the employees shall be considered regular employees. Company failed to satisfy with DOLE 19 requirement since it only submitted the termination report covering respondent’s last project at the hearing before the LA HOWEVER, BECAUSE respondent did not allege he had been illegally dismissed after each of the projects for which he had signed up for, LA and NLRC were satisfied with petitioner company’s compliance

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Maraguinot v. NLRC

Maranaw Hotels & Resort Corp v CA

Mercado v NLRC

Brent School v. Zamora

projects. Petitioners were employed by private respondents on 18 July 1989 as part of the filming crew. They requested an increase in their salary pursuant to the minimum wage. Accordingly, the executive producer would only agree to increase the salary once they sign a blank employment contract. They refused. Eventually, they were terminated.

Oabel worked for Maranaw Hotels in various capacities for more than a year before she was assigned by said company to MANRED. She subsequently filed a petition for regularization before the NLRC which was later converted into a complaint for illegal dismissal. Petitioners were agricultural workers utilized by private respondents in all the agricultural phases of work on the sugar land owned by the latter. They claim that they were illegally dismissed. LA held that petitioners were not regular and permanent workers of the private respondents, for the nature of the terms and conditions of their hiring reveal that they were required to perform phases of agricultural work for a definite period of time after which their services would be available to any other farm owner. Alegre was hired as athletic director of the school with the specific contract of 5 years. 3 months before the expiration of the contract, he was issued a notice of his termination. Alegre claims that he is already a

They are regular employees, not project employees. JURISPRUDENCE: Lao Construction v. NLRC. Although the case of Lao involves the construction industry, the same may be applied to the motion-picture industry. No substantial distinction exists between the projects undertaken in both industries. The raison d' etre of both industries concern projects with a foreseeable suspension of work. Oabel is a regular employee of Maranaw Hotels.

The doctrine in Lao Constuction v. NLRC applies to industries other than that of construction provided that such industry concerns projects with a foreseeable suspension of work.

Petitioners are project employees/seasonal employees. Their employment legally ends upon completion of the project or the season.

A project employee has been defined to be one whose employment has been fixed for a specific project or undertaking, the completion or termination of which has been determined at the time of the engagement of the employee, or where the work or service to be performed is seasonal in nature and the employment is for the duration of the season (as in the present case).

When the employer determines the nature of the tasks to be performed by the employee, such is considered as an aspect of the process exercising control, which can in turn serve as basis for regular employments.

Alegre was properly terminated. PD 850, impliedly acknowledged the propriety of term employment: it listed the "just causes" for which "an employer may terminate employment A2015 LABOR FINALS REVIEWER- Roe, Maan, Lindsey, Kimmie, Kor and Mica

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regular employee and cannot be terminated. Note: the case happened before the effectivity of the Labor Code.

Lynvil Fishing Enterprises v. Andres Ariola

Respondents in this case worked for Lynvil as part of its fishing crew on board on of its vessels. Said employees were engaged on a per trip or “porviaje” basis which terminates at the end of each trip. They were terminated due to their involvement in an incident wherein several tubs of the company’s fish were stolen. There was a contention as to WON they were regular or fixed-term employees, considering that their “porviaje” setup was based on a contract of employment which they signed.

Phil Tobaco etc v. NLRC

2 groups of seasonal workers, the Lubat group and the Luris group are claiming separation benefits after the closure and transfer of petitioner’s tobacco processing supposedly due to serious financial losses. The Lubat group was not granted separation pay by the petitioner as they had not been given work during the preceding year and, hence, were no

without a definite period," thus giving rise to the inference that if the employment be with a definite period, there need be no just cause for termination thereof if the ground be precisely the expiration of the term agreed upon by the parties for the duration of such employment. Respondents, while validly dismissed for their involvement in the aforementioned incident, were to be considered as regular employees. According to the court, while their employment contract provided that they were to be engaged as fixed-term employees, facts surrounding their employment (constant rehiring at the end of each trip for almost 10 years, etc.) support the conclusion that their alleged fixed-term employment was just so that Lynvil could undermine their security of tenure and that respondents were forced to accede to such conditions only because of economic reasons. In effect, the first condition for the validity of a fixed-term contract was missing since economic reasons vitiated their consent. Petitioner’s claim of serious business losses was not adequately proven so the last 2 sentences of Art. 283 must be applied and the dismissed employees of the Luris group must be given their separation pay due to “closure or cessation of operation of an establishment or undertaking.” The Court also held

2 conditions for the validity of a fixed-contract agreement between the employer and employee: (1) the fixed period of employment was knowingly and voluntarily agreed upon by the parties without any force, duress, or improper pressure being brought to bear upon the employee and absent any other circumstances vitiating his consent; or (2) it satisfactorily appears that the employer and the employee dealt with each other on more or less equal terms with no moral dominance exercised by the former or the latter.

Seasonal workers who are called to work from time to time and are temporarily laid off during offseason are not separated from service in said period, but are merely considered on leave until reemployed. A seasonal worker is considered in regular employment in cases involving determination of employer-employee relationship

The amount of separation pay is based on two factors: the amount of monthly salary and the number of years of service. While Book 6 of the LC does not specifically define “one year of service”, Arts. 283 and 284 both state in connection with separation

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longer in its employ at the time it closed its plant. The Luris group received separation benefits but apparently these were wrongly computed as the management did not consider ¾ of their service.

that the members of the Lubat group were illegally dismissed. Re: Separation Pay- one-half (1/2) their respective average monthly pay during the last season respondents worked multiplied by the number of years they actually rendered service, provided that they worked for at least six months during a given year.

and security of tenure.

pay that a fraction of at least six months shall be considered one whole year.

Espina v. CA

MY San was to close business. Monde purchased the company and commenced its operations. All former employees of MY San who were terminated upon its closure and who applied and qualified for probationary employment (including petitioners herein) started working for Monde on a contractual basis for 6 months. Petitioners were terminated subsequently on various dates.

Petitioners were PROBATIONARY EMPLOYEES (Art 281). While petitioners were only probationary employees who do not enjoy permanent status, nonetheless, they were still entitled to the constitutional protection of security of tenure. Their employment may only be terminated for a valid and just cause or for failing to qualify as a regular employee in accordance with the reasonable standards made known to them by the employer at the time of engagement and after being accorded due process

As probationary employees, they enjoyed only temporary employment status Terminable anytime Employer could well decide if he no longer needed the probationary’s service or his performance fell short of expectations, as a probationary employee is one who, for a given period of time, is under observation and evaluation to determine whether or not he is qualified for permanent employment. During the probationary period, the employer is given the opportunity to observe the skill, competence and attitude of the employee to determine if he has the qualification to meet the reasonable standards for permanent employment Length of time is immaterial in determining the correlative rights of both employer and employee in dealing with each other during said period

Management prerogative as long as performed in GOOD FAITH

Robinson's Galleria v. Ranchez

Ranchez was a probationary employee of petitioner Robinsons Galleria for a period of 5 months. She

The haphazard manner in the investigation of the missing cash, which was left to the

There is probationary employment when the employee upon his engagement is made to undergo a

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Cathay Pacific Airways, Limited v. Marin

Canadian Opportunities

underwent 6 weeks of training as a cashier before she was hired. She reported to her supervisor the loss of cash amounting to P20,299.00 which she had placed inside the company locker. She was strip-searched but was found with nothing. She acknowledged her responsibility and requested that she be allowed to settle and pay the lost amount. The management refused and instead, reported the matter to the police. An information for Qualified Theft was filed against her. She was imprisoned for two weeks. She filed for illegal dismissal. Subsequently, Robinson’s sent Ranchez by mail a notice of termination and/or notice of expiration of probationary employment. Marin was hired as Reservation Officer by Cathay Pacific Airways. He was hired on April 6, 1992 under 6 months probationary period. On October 2, 1992, he received a termination letter from the company. Marin claims that he was illegally dismissed because there was no due process.

determination of the police authorities and the Prosecutor’s Office, violated the substantive and procedural due process. Administrative investigation was not conducted by petitioner Supermarket. Ranchez was constructively dismissed by petitioner. It was unreasonable for Robinson’s to charge her with abandonment for not reporting for work upon her release in jail.

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. Probationary employees enjoy security of tenure. They may only be terminated for any of the following: (1) a just or (2) an authorized cause; and (3) when he fails to qualify as a regular employee in accordance with reasonable standards prescribed by the employer.

Respondent's employment was not terminated during the period of his probationary employment, and that he was not extended a regular employment by petitioner Cathay on account of his unsatisfactory work performance during the probationary period.

Dalangin was a probationary

Dalangin was validly dismissed

The employment of a probationary employee may only be terminated either (1) for a just cause; or (2) when the employee fails to qualify as a regular employee in accordance with the reasonable standards made known to him by the employer at the start of his employment. The power of the employer to terminate an employee on probation is thus subject to the following conditions: (1) it must be exercised in accordance with the specific requirements of the contract; (2) the dissatisfaction on the part of the employer must be real and in good faith, not prejudicial so as to violate the contract or the law; and (3) there must be no unlawful discrimination in the dismissal. The essence of a probationary

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Unlimited Inc v Dalangin

employee of Canadian Opportunities who was dismissed only 1 month into his probationary employment after having been found to be “unfit” and “unqualified” to continue rendering his services to said company. There was thus a contention as to WON he was given reasonable time by his employer to prove that he possessed the qualifications they were looking for.

during his probationary period since it is during this probationary appointment when an employer is given the opportunity to observe the fitness of a probationer while at work, and to ascertain whether he would be a proper and efficient employee 4 weeks was enough for the company to assess Dalangin’s fitness for the job to which he was found wanting. Thus, Canadian Opportunities was not liable for illegal dismissal.

Cebu Stevedoring Co Inc. v. Regional Director

Respondents were former employees of the CCAS. The CCAS was abolished. All the employees were absorbed by the petitioner company with the same positions that they held in CCAS. Barely 5 and ½ mos. later, respondents were dismissed for redundancy.

Respondents were not novices in their jobs but experienced workers. As regular employees, private respondents may not be dismissed and petitioner cannot terminate their services except for a just or authorized cause provided by law and with scrupulous observance of due process requirements.

Tamson's Enterprises Inc v. CA & Sy

4 days before completing her 6th month of working in Tamson’s, Ng (Sales Project Manager) called respondent to a meeting informing

NOT PROBATIONARY EMPLOYEE, REGULAR

period of employment fundamentally lies in the purpose or objective of both the employer and the employee during the period, that while the employer observes the fitness, propriety and efficiency of a probationer to ascertain whether he is qualified for permanent employment, the latter seeks to prove to the former that he has the qualifications to meet the reasonable standards for permanent employment. The word ‘probationary,’ as used to describe the period of employment, implies the purpose of the term or period, but not its length. While Art 283 allows the employer to terminate the employment of an employee due to redundancy, records fail to show that the positions occupied by the private respondents are Identical with those presently existing in petitioner's office. Furthermore, petitioner kept private respondents in its employ for almost six months without raising this issue. Petitioner's submission that it is suffering financial losses is untenable since it appears that it absorbed and employed for almost six months, without any intimation of supposed financial distress, the majority of the former employees of CCAS. Probationary employment is intended to afford employer an opportunity to observe the fitness of a probationary employee while

HOWEVER, standards for fitness must be made known to employee prior to entering into contract of

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La Sallete of Santiago Inc v. NLRC

St. Paul College, Quezon City v. Ancheta

her that her services would be terminated due to inefficiency. During her pre-employment interview, Lee commented about her good work experience and educational background, and was assured of a long term employment with benefits. Throughout her employment, she earnestly performed her duties, had perfect attendance, worked even during brownouts and typhoons and would often work overtime. Javier worked for the sister companies La Salette College, La Salette High School, and La Salette of Santiago, Inc. at different instances as teacher, instructor (part-time and full-time), assistant principal, and principal. After serving as principal at La Salette of Santiago, Inc. for one year, she was extended an appointment for another year. After the expiration of the second year, she was replaced. She filed for illegal dismissal. The spouses were hired by St. Paul College as their teachers. They have received several notices from the school that they are not following school policies when it comes to the style of teaching and exams that the school recommends.

at work, and to ascertain whether he will become an efficient and productive employee At the same time, probationary employee seeks to prove his worth. Term probationary implies the PURPOSE of the term/period and not its length

Javier had acquired security of tenure as a teacher in the School System of La Salette of Santiago, Inc.,but not as a principal. Her work as a teacher was intended to be on a permanent basis. Her appointment as principal was not.

Teachers who are appointed as department heads or administrative officials (e.g. principal) do not normally, and should not expect to, acquire a second status of permanency, or an additional or second security of tenure as such officer.

A reality we have to face in the consideration of employment on probationary status of teaching personnel is that they are not governed purely by the Labor Code. The Labor Code is supplemented with respect to the period of probation by special rules found in the Manual of Regulations for Private Schools.

On the matter of probationary period, Section 92 of these regulations provides:Section 92. Probationary Period. - Subject in all instances to compliance with the Department and school requirements, the probationary period for academic personnel shall not be more than three (3) consecutive years of satisfactory service for those in the elementary and secondary levels, six (6) consecutive regular semesters of satisfactory service for those in the tertiary level, and nine (9) consecutive trimesters of satisfactory service for those in the

employment. No standards= REGULAR EMPLOYEE. No standards presented in this case.

It is important that the contract of probationary employment specify the period or term of its effectivity. The failure to stipulate its precise duration could lead to the inference that the contract is binding for the full three-year probationary period. Therefore, the letters sent by petitioner Sr. Racadio, which were void of any specifics cannot be considered as contracts. The closest they can resemble to are that of

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tertiary level where collegiate courses are offered on a trimester basis.

informal correspondence among the said individuals. As such, petitioner school has the right not to renew the contracts of the respondents, the old ones having been expired at the end of their terms.

TERMINATION OF EMPLOYMENT General Concepts Alahambra Industries Inc v NLRC

Pantoja v. SCA Hygiene Products Corp

Coca-Cola Bottlers v. Valentina Garcia

Rupisan was a salesman of Alhambra who was placed under preventive suspension for serious violations of company policies. After he was subsequently terminated, he filed a complaint for illegal dismissal against Alhambra. NLRC affirmed the LA’s findings that he was illegally dismissed and ordered his reinstatement. Respondent informed petitioner of its reorganization plan and offered him a position at another mill under the same terms and conditions of employment in anticipation of the eventual closure of Paper Mill No. 4 as part of respondent’s plan to phase out the company’s industrial paper manufacturing operations due to financial difficulties. Petitioner rejected the respondent’s offer so he was terminated & his position was declared redundant. Petitioner claims he was illegal dismissed. Respondents argues that petitioner voluntarily separated himself from service instead of accepting reassignment/transfer to another position of equal rank and pay. Coca-Cola hired Garcia as QC Technician. Respondent became regular employee. While petitioner adopted some modification programs

Rupisan was not entitled to reinstatement but only to backwages.

The SC upheld the employer’s exercise of its management prerogative because it was done for the advancement of its interest and not for the purpose of defeating the lawful rights of an employee. Respondent’s right of management prerogative was exercised in good faith and there was no evidence to prove Paper Mill No. 4 continued its operations.

As long as no arbitrary or malicious action on the part of an employer is shown, the wisdom of a business judgment to implement a cost saving device is beyond this court’s determination. After all, the free will of management to conduct its own business affairs to achieve its purpose cannot be denied.

PROCEDURAL DUE PROCESS VIOLATED IN THIS CASE

BUT: In dismissing an employee, employer has the burden of proving that the dismissed worker has been served TWO NOTICES

Court admits that abandonment

Work reassignment of an employee as a genuine business necessity is a valid management prerogative.

Art 277 and Sec 2 Rule XXII Book V of Omnibus Rules Implementing LC— Standards of due process

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Mansion Printing Center v. Bitara

which resulted to increased efficiency in production, work load of employees were substantially reduced and some of the employees became redundant. Petitioner informed respondent that she would be transferred to Iloilo but respondent refused

was present and a valid ground for termination

The first to inform the employee of the particular acts or omissions for which the employer seeks his dismissal and -Must state that employer seeks dismissal for the act/omission charged against the employee (otherwise, the notice does not comply with the rules) RATIONALE: The notice will afford the employee an opportunity to avail all defenses and exhaust all remedies to refute the allegations hurled against him for what is at stake is his very life and limb his employment. Otherwise, notice may be disregarded The second to inform the employee of his employer’s decision to terminate him

Mansion engaged the services of Bitara as a helper (kargador). He was later promoted as the company’s sole driver. Mansion closely monitored the attendance of respondent. They noted his habitual tardiness and absenteeism. Mansion issued a Memorandum requiring respondent to submit a written explanation why no administrative sanction should be imposed on him for his habitual tardiness. He continued to disregard attendance policies. Another Memorandum (Notice to Explain) was issued requiring respondent to explain why his services should not be terminated. He did not submit any explanation and, thereafter, never reported for work.

That the recent absences were unauthorized were satisfactorily established by petitioners. Mansion has repeatedly called the attention of respondent concerning his habitual tardiness. These attendance delinquencies may be characterized as habitual and are sufficient justifications to terminate the complainant’s employment.

Valid dismissal = compliance with both substantive and procedural aspects. Procedural due process entails compliance with the two-notice rule in dismissing an employee, to wit: (1) the employer must inform the employee of the specific acts or omissions for which his dismissal is sought; and (2) after the employee has been given the opportunity to be heard, the employer must inform him of the decision to terminate his employment.

The notices have been validly served. Bitara just refused to acknowledge receipt thereof.

*Gross negligence - “want of care in the performance of one’s duties”; *Habitual neglect - “repeated failure to perform one’s duties for a period of time, depending upon the circumstances.”

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Another Memorandum (Notice of Termination) upon him informing him that the company found him grossly negligent of his duties, for which reason, his services were terminated. Golden Ace Builders & Azul v. Talde

Talde worked as a carpenter in the company. He was dismissed due to absence of construction jobs available. Upon complaint to the Labor arbiter, it ruled in favor of respondent and ordered his immediate reinstatement without loss of seniority rights and other privileges, and with payment of full backwages. Respondent submitted, however, on May 16, 2001 a manifestation to the Labor Arbiter that actual animosities existed between him and petitioners and there had been threats to his life and his family’s safety, hence, he opted for the payment of separation pay.

The basis for the payment of backwages is different from that for the award of separation pay. Separation pay is granted where reinstatement is no longer advisable because of strained relations between the employee and the employer. Backwages represent compensation that should have been earned but were not collected because of the unjust dismissal. The basis for computing backwages is usually the length of the employee’s service while that for separation pay is the actual period when the employee was unlawfully prevented from working.

Under the doctrine of strained relations, the payment of separation pay is considered an acceptable alternative to reinstatement when the latter option is no longer desirable or viable. On one hand, such payment liberates the employee from what could be a highly oppressive work environment. On the other hand, it releases the employer from the grossly unpalatable obligation of maintaining in its employ a worker it could no longer trust.

Clearly then, respondent is entitled to backwages and separation pay as his reinstatement has been rendered impossible due to strained relations. As correctly held by the appellate court, the backwages due respondent must be computed from the time he was unjustly dismissed until his actual reinstatement, or from February 1999 until June 30, 2005 when his reinstatement was rendered impossible without fault on his part. Functional Inc. v. Samuel C. Granfil

Granfil was a photocopying machine operator for Functional Inc. before he

Granfil was illegally dismissed by Functional by

The burden of proof is upon the

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Pepsi-Cola Product Phil Inc v EV Santos

Jackqui Moreno v. San Sebastian College

was dismissed for allegedly accepting money from a customer. There was a contention as to whether Granfil had the burden of proof to prove the illegality of the dismissal or Functional Inc. had the burder of proof to prove the validity of the dismissal. Respondent was dismissed for serious misconduct which resulted in losses to petitioners amounting to P795,454.54. Respondent filed a case for illegal dismissal. LA dismissed and held that petitioners failed to satisfactorily prove the serious charges against respondent. The only relevant evidence adduced by petitioners was the notice of termination which narrated what happened during the administrative investigation.

failing to discharge the burden that it legally terminated his services.

employer to show that the employee’s termination from service is for a just and valid cause.

Petitioner failed to satisfactorily prove the serious charges against respondent.

In an illegal dismissal case, the onus probandi rests on the employer to prove that its dismissal of an employee is for a valid cause. As to whether a trial was necessary, the Court held that it is not violative of due process for the LA to resolve a case solely on the position papers, affidavits or documentary evidence submitted by the parties.

The holding of a formal hearing or trial is discretionary with the Labor Arbiter and is something that the parties cannot demand as a matter of right. The requirements of due process are satisfied when the parties are given the opportunity to submit position papers wherein they are supposed to attach all the documents that would prove their claim.

Petitioner was a full-time college faculty member offered chairmanship position. Reports and rumors of Moreno’s unauthorized external engagements allegedly began to circulate and it reached SSCR. The school’s HR Dept conducted a formal investigation. She was found to have been teaching elsewhere without prior authorization. She explained she needed extra money for her mother and sister so she took on extra lectures in other colleges.

PENALTY TOO HARSH

No worker shall be dismissed from employment without the observance of substantive and procedural due process

Art 282 (a) will ful disobedience of employer’s lawful orders as a just cause for termination of employment envisages the concurrence of at least 2 requisites (1) The employee’s assailed conduct must have been willful or intentional, the willfulness being characterized by a “wrongful and perverse attitude”  FAILED TO PROVE THIS IN THIS CASE (2) The order violated must have been reasonable, lawful, made known to the employee and must pertain to the duties which he has

Court finds that Moreno has indeed committed misconduct against respondent. HOWEVER, said misconduct falls below the required level of gravity that would warrant dismissal as a penalty

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been engaged to discharge Nagkakaisang Lakas ng Manggagawa sa Keihin v. Keihin

Globe Telecom v. Crisologo

Valenzuela was a production Valenzuela deserves dismissal. She The circumstances surrounding the associate in Keihin. Due to the recent committed serious misconduct. commission of violations are to be cases of theft and robbery of Valenzuela was not even on her taken into consideration in the company property, Keihin adopted a second year of service with Keihin imposition of penalty. search procedure of all employees when the incident of theft before leaving the company occurred. Keihin was dealing with premises. Valenzuela was about to several cases of theft, vandalism, leave the office when she saw a and loss of company and packing tape and placed it in her bag, employees’ property when the thinking of using it for her own incident involving Helen personal needs. Upon search, the transpired. lady guard on duty found the tape in Valenzuela’s bag, confiscated the same, and submitted an incident report to the Guard-in-Charge, who in turn submitted a memo to the HR Dept. A show-cause notice was sent to Valenzuela, further stating that theft and robbery warrant the penalty of dismissal. She was subsequently directed to explain in writing why no disciplinary action should be taken against her. She was terminated. She filed for illegal dismissal. TERMINATION OF EMPLOYMENT BY EMPLOYEE Petitioner, a manager of Globe, took Coercion exists when there is a Moreover, the resignation letter a leave because of her miscarriage. reasonable or well-grounded fear was submitted by respondent and After a week-long absence, of an imminent evil upon a person was accepted by Globe on April 12, respondent reported back to work on or his property or upon the person 2002. This fact alone April 12, 2002. On the same day, she or property of his spouse, completely negated her claim that tendered her resignation letter descendants or ascendants. No petitioners coerced her to resign explaining that she was advised by such situation existed in this case. on April 30, 2002. Indeed, how her doctor to rest for the duration of An employee of respondent’s could she have been forced to her pregnancy. She also requested accomplished educational resign on that date when she had permission to exhaust her unused background and professional already tendered her resignation leaves until the effective date of her standing will not easily relinquish more than two weeks earlier? resignation on May 30, 2002. Globe her legal rights unless she intends accepted her resignation. The to. Respondent’s resignation letter petitioner claims that she was forced without doubt proved petitioners’ to resign by the company through assertion that she voluntarily A2015 LABOR FINALS REVIEWER- Roe, Maan, Lindsey, Kimmie, Kor and Mica

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the circumstances that she faced.

resigned from her job.

Nationwide Security and Allied Services v. Valderama

Valderama was one of Nationwide’s security guards who filed a complaint for constructive dismissal against the agency after having been placed on floating status for more than 6 months. Nationwide, however, claimed that Valderama voluntarily resigned from work after having claimed his cash bond and fire arm deposit.

The burden of proof of proving voluntary resignation is incumbent upon the employer.

Bilbao v. Saudi Arabian Airlines

Bilbao was a flight attendant assigned at the Manila Office. There was memo from management regarding the transfer of 10 FAs from Manila to Jeddah, including Bilbao. She initially complied with the transfer order and proceeded to Jeddah for her new assignment but on soon resigned and relinquished her post through a resignation letter. She executed and signed an Undertaking similar to that of a Receipt, Release and Quitclaim wherein she acknowledged receipt of a sum of money as “full and complete end-of-service award with final settlement and have no further claims whatsoever against Saudi Arabian Airlines.”

Valderama did not voluntarily resign but was constructively dismissed. According to the court, should an employer interposed the defense of resignation, it is incumbent upon them to prove that an employeed indeed voluntarily resigned from employment. In this case, Nationwide failed to discharge its burden of proving that Valderama voluntarily resigned by not being able to present his resignation letter or explain why Valderama was still being required to report to its office even after he had allegedly resigned. Bilbao’s resignation letter and undertaking that evidenced her receipt of separation pay, when taken together with her educational attainment and the circumstances surrounding the filing of the complaint for illegal dismissal, comprise substantial proof of Bilbao’s voluntary resignation.

Azcor v. NLRC

Respondent worked for Azcor as a

ILLEGALLY DISMISSED. No

Burden of proof that employee

Resignation is the voluntary act of an employee who is in a situation where one believes that personal reasons cannot be sacrificed in favor of the exigency of the service, and one has no other choice but to dissociate oneself from employment. It is a formal pronouncement or relinquishment of an office, with the intention of relinquishing the office accompanied by the act of relinquishment. As the intent to relinquish must concur with the overt act of relinquishment, the acts of the employee before and after the alleged resignation must be considered in determining whether he or she, in fact, intended to sever his or her employment.

As to the quitclaim/waivers: not all waivers and quitclaims are invalid as against public policy. There are legitimate waivers and quitclaims that represent a voluntary and reasonable settlement of workers’ claims which should be respected by the courts as the law between the parties.

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ceramics worker for more than 2 years (P50 was deducted from his daily salary without informing him of the reason). Upon his doctor’s recommendation, respondent verbally requested to go on sick leave due to bronchitis due to harmful ceramic dust he inhales at his job. Respondent went back to Azcor to resume work but he was not entertained. Apparently Azcor had closed down and they told him he was to be transferred to the new company. He returned another 5 times to no avail. Petitioners claim he resigned.

A' Prime Security Services v. NLRC

Ma. Socorro Mandapat v. Add Force Personnel Services

resignation.

was not illegally dismissed lies with the employer

To constitute resignation, it must be unconditional and with the intent to operate as such. There must be INTENTION TO RELINQUISH a portion of the term of office accompanied by an act of relinquishment  resignation letters presented indicate that they were drafted without his knowledge (written in English) IN THIS CASE: Capulso signified his desired to resume work after recuperating negates any intention to relinquish his job

Moreno was hired as security guard The resignation letter appears to for a year by the Sugarland Security have been written and submitted Services, Inc., a sister company of at the instance of petitioner. Its A’Prime. He was rehired as a security form is of the company’s and its guard on by A’Prime and was wordings are more of a waiver and assigned to the US Embassy. He was quitclaim. The supposed forced by petitioner to sign new resignation was not acknowledged probationary contracts of before a notary public. employment for six (6) months. Eventually, his employment was terminated. A’Prime adduced as evidence a resignation letter purporting to have been submitted by Moreno. Termination of Employment by Employer Respondent claims that during the Upon perusal of the records of this five-month stint as sales manager of case, we find no evidence to the petitioner Mandapat, she failed support discrimination which led to close a single deal or contract with to constructive dismissal. We find any client. In addition, petitioner that there was no act of issued several proposals to clients discrimination committed against which were either grossly petitioner that would render her disadvantageous to respondent or employment unbearable. disregarded the client’s budget Preventive suspension may be

Petitioners never dealt with Capulso openly and in good faith nor was he informed of the developments within the company (i.e. his transfer to FP and the closure of Azcor’s operations) =TOTALITY OF EVIDENCE points to a veiled attempt by petitioners to deprive Capulso of what he had earned through hard labor by taking advantage of his low level of education and confusing him as to whom his true employer was Should the employee elect to terminate the employer-employee relationship without just cause, he/she shall observe the provisions of the law (Article 285 (a), LC).

Constructive dismissal exists when an act of clear discrimination, insensibility or disdain by an employer has become so unbearable to the employee leaving him with no option but to forego with his continued employment. When preventive suspension

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ceiling. These infractions were contained in a show-cause notice sent to petitioner on 23 February 2004, directing her to explain why she should not be disciplined for gross and habitual neglect of duties and willful breach of trust. Petitioner was also preventively suspended and was asked to turn over pending tasks and to leave the office premises. Petitioner filed a complaint for constructive dismissal with the labor arbiter.

legally imposed against an employee whose alleged violation is the subject of an investigation. The purpose of his suspension is to prevent him from causing harm or injury to the company as well as to his fellow employees.

exceeds the maximum period allowed without reinstating the employee either by actual or payroll reinstatement or when preventive suspension is for indefinite period, only then will constructive dismissal set in.

Yabut v. MECO

Yabut worked for Meralco before he was dismissed for serious misconduct after having been involved in a meter tampering and illegal electric connection incident in his own residence. The termination of his services led to his filing of an illegal dismissal complaint against Meralco.

As a measure of self-protection against acts inimical to its interest, a company has the right to dismiss its erring employees. An employer cannot be compelled to continue employing an employee guilty of acts inimical to the employer’s interest, justifying loss of confidence in him.

Alert Security& Investigation Agency v. Saidali Pasawilan

Respondents were all employed by petitioner as security guards. They filed a complaint for money claims because they were underpaid. Because of this they were relieved from their posts and not given assignments for 6 months. They filed a complaint for illegal dismissal. Petitioners deny that they dismissed the respondents. They claimed that respondents were transferred to new posts but respondents failed to report at their new post, continued to loiter at their previous post and tried to convince the other guards to

Yabut was validly dismissed by Meralco as factual findings of the lower courts as affirmed by the SC as to his involvement in the meter tampering and illegal electric connection issue support his separation from service pursuant to a just cause under Art. 282 of the Labor Code. According to the SC, the dismissal of a dishonest employee is to the best interest not only of the management but also of labor. Respondents were illegally dismissed. Filing a legitimate complaint for money claims against the employer is not a valid ground for termination.

The Court recognizes the right of an employer to transfer employees in the interest of the service. This exercise is a management prerogative which is a lawful right of an employer. This right however, has limitations. In particular, the employer must be able to show that the transfer is not unreasonable, inconvenient or prejudicial to the employee; nor does it involve a demotion in rank or a diminution of his salaries, privileges and other benefits.

Although the Court recognizes the right of employers to shape their own work force, this management prerogative must not curtail the basic right of employees to security of tenure. There must be a valid and lawful reason for terminating the employment of a worker. Otherwise, it is illegal. Bascon v. CA: The

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file complaints against petitioner company

Mapili v. Phil Rabbit Bus Lines

Company's field inspector found petitioner, a bus conductor for the company, giving a free ride to a the wife of an ex employee. It was found that he had given out 2 free rides in the past and was duly penalized for them. He was subsequently dismissed. Petitioner argues that he was illegally dismissed as such violations were trivial in nature and dismissal was grossly disproportionate to the infraction.

Not illegally dismissed. Dismissal was for just cause (breach of trust and confidence) and penalty was not disproportionate to the infraction.

Petitioner's position is imbued with trust and confidence because it involves handling of money and failure to collect the proper fare from the riding public constitutes a grave offense, which justifies his dismissal. Moreover, petitioner's series of irregularities (he had done this twice before) when put together; may constitute serious misconduct.

Antonio Aboc v. Metrobank

Aboc works for Metrobank as a loans clerk. He was given merit increases and awarded promotions during his employment because of his highly satisfactory performance during his nine years of employment. He received an inter-office letter requiring him to explain in writing the charges that he had actively participated in the lending activities of his immediate supervisor, Chua. This was later on proven to be true. Metrobank required Aboc to submit a written explanation why he should not be dismissed. Aboc was dismissed on the ground of serious misconduct and breach of trust and confidence.

Metrobank’s evidence clearly shows that the acts of Aboc in helping Chua organize the CNRI and FFA credit unions and in the operations thereof constituted serious misconduct or breach of trust and confidence. Aboc’s active participation highly irregular and clearly in conflict with Metrobank’s business. He didn’t even inform the bank.

ART. 282. TERMINATION BY EMPLOYER. - An employer may terminate an employment for any of the following causes:

employer’s power to dismiss must be tempered with the employee’s right to security of tenure. Although petitioner already suffered corresponding penalties for his misconduct, those infractions are still relevant and may be considered in assessing his liability for his present infraction. The fact that petitioner was in the company for 8 years (and that he was a member of the company's labor union) was not a mitigating circumstance but aggravated his liability--he should have known it was company policy that before allowing family members of employees to avail of free rides, permission must first be secured.

(a) Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or representative in connection with his work; - The burden of proof rests on the employer to show that the dismissal was for a just cause or authorized cause, which should be proved by substantial evidence.

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Nissan Motors Phil Inc v. Victorino Angelo

Victorino Angelo was hired as a payroll staff. Due to his frequent absences, he was not able to do his job which affected hundreds of employees who did not receive their salary in time. Due to this, he was suspended by the company. Angelo filed a complaint for illegal suspension to the Labor Arbiter.

One of the just causes enumerated in the Labor Code is serious misconduct. Misconduct is improper or wrong conduct. It is the transgression of some established and definite rule of action, a forbidden act, a dereliction of duty, willful in character, and implies wrongful intent and not mere error in judgment. Such misconduct, however serious, must nevertheless be in connection with the employee's work to constitute just cause for his separation.

Lores Realty Enterprises Inc v. Pacia

Pacia was an Assistant Manager of Lores Realty who was dismissed for willful disobedience after she hesitated to prepare several checks as ordered by her superiors because she knew that the company’s accounts did not contain enough funds to cover said checks.

Pacia was not guilty of insubordination. According to the court, Pacia was motivated by honest and well intentioned reasons since protecting the company from liability under the Bouncing Checks Law was foremost in her mind. Her act therefore, was not wrongful or willful.

For misconduct or improper behavior to be a just cause for dismissal, (a) it must be serious; (b) it must relate to the performance of the employee's duties; and (c) it must show that the employee has become unfit to continue working for the employer. Going through the records, this Court found evidence to support the allegation of serious misconduct or insubordination. Petitioner claims that the language used by respondent in his LetterExplanation is akin to a manifest refusal to cooperate with company officers, and resorted to conduct which smacks of outright disrespect and willful defiance of authority or insubordination. The misconduct to be serious within the meaning of the Labor Code must be of such a grave and aggravated character and not merely trivial or unimportant. The offense of willful disobedience requires the concurrence of 2 requisites: (1) the employee's assailed conduct must have been willful, that is characterized by a wrongful and perverse attitude; and (2) the order violated must have been reasonable, lawful, made known to the employee and must pertain to the duties which he had been engaged to discharge.

Petitioner also dismissed respondent because of gross or habitual negligence. Neglect of duty, to be a ground for dismissal, must be both gross and habitual. In finding that petitioner was able to adduce evidence that would justify its dismissal of respondent, the NLRC correctly ruled that the latter's failure to turn over his functions to someone capable of performing the vital tasks which he could not effectively perform or undertake because of his heart ailment or condition constitutes gross neglect.

Going through the records, this Court found evidence to support the allegation of serious misconduct or insubordination. Petitioner claims that the language used by respondent in his Letter-Explanation is akin to a manifest refusal to cooperate with company officers, and resorted to conduct which smacks of outright disrespect and willful defiance of authority or insubordination. The misconduct to be serious within the meaning of the Labor Code must be of such

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National Book Store v. CA

Part of respondents' job is to count the earnings of SM North-NBS under a watcher and following a rigorous procedure. Before being deposited, the money found to be missing a certain amount. They were dismissed for gross neglect of duty and loss of confidence. LA: Although private respondents were afforded due process before being dismissed, their dismissal was not founded on valid and justifiable grounds as provided under Art. 282 LC.

Petitioners were illegally dismissed. No proof that private respondents were even remotely negligent of their duties, and even if they were, it cannot be considered as habitual. No willful breach of confidence in the instant case as petitioners failed to establish with certainty the facts upon which it could be based.

Gross negligence has been defined as the want or absence of or failure to exercise slight care or diligence, or the entire absence of care. It evinces a thoughtless disregard of consequences without exerting any effort to avoid them. Significantly, in order to constitute a just cause for the employee’s dismissal, the neglect of duties must not only be gross but also habitual. Thus, the single or isolated act of negligence does not constitute a just cause for the dismissal of the employee.

PNB v Dan Padao

Padao was hired by PNB as a clerk. He was later designated as a credit investigator in an acting capacity. He was appointed regular Credit Investigator III, and was ultimately promoted to the position of Loan and Credit Officer IV. A complaint reached the Commission on Audit that anomalous loans were being granted by its officers. The credit standing of the loan applicants was fabricated, allowing them to obtain larger loan portfolios from PNB. These borrowers eventually defaulted on the payment of their loans, causing PNB to suffer millions in losses. Padao was administratively charged with Dishonesty, Grave Misconduct, Gross Neglect of Duty, Conduct Prejudicial to the Best Interest of the Service, grounded on his having allegedly presented a deceptively positive status of the business, credit standing/rating and financial capability of loan applicants.

Padao’s repeated failure to discharge his duties as a credit investigator of the bank amounted to gross and habitual neglect of duties under Article 282 (b) of the Labor Code. He not only failed to perform what he was employed to do, but also did so repetitively and habitually, causing millions of pesos in damage to PNB.

Neglect of the employee's duties must be sufficiently proven to be gross and habitual in order that this may constitute a valid ground for dismissal.

a grave and aggravated character and not merely trivial or unimportant. Loss of trust and confidence to be a valid ground for dismissal must be based on a willful breach of trust and founded on clearly established facts. A breach is willful if it is done intentionally, knowingly and purposely, without justifiable excuse, as distinguished from an act done carelessly, thoughtlessly, heedlessly or inadvertently. Gross negligence connotes want of care in the performance of one’s duties, while habitual neglect implies repeated failure to perform one’s duties for a period of time, depending on the circumstances.

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Jumad v. Hi Flyer Food

MECO v. Ma. Luisa Beltran

PNB found Padao guilty of gross and habitual neglect of duty and ordered him dismissed from the bank. Petitioner was area manager for KFC branches in 4 cities. Upon audit conducted, 3 branches were found to have irregularities (rodent infestation, defective machinery and cash shortages (62k)). Jumuad explains she had no fault in the incidents, that she had already taken steps to address the issues and that she was busy dealing with the other branches. Company sent her a Notice of Charges seeking to hold her accountable for the incidents and was eventually terminated, despite her explanations.

Beltran was employed by MERALCO as Senior Branch Clerk. While she was working overtime on a Saturday, she received cash from Collection Route Supervisor Marcos, which the latter received from customer Chang in payment of the latter’s electric bill in lieu of a returned check earlier issued. She issued Auxiliary Receipt which she post-dated (the following

Jumuad NOT ILLEGALLY DISMISSED. Dismissal justified on the ground for breach of trust and confidence but not for gross/habitual neglect of duty.

There were no sufficient grounds to warrant Beltran’s dismissal. Negligence has been established. But Beltran’s simple negligence is not sufficient to warrant separation from employment. No concrete evidence has been adduced by MERALCO to prove such. Moreover, her simple negligence did not result in any loss to

- Gross negligence connotes want or absence of or failure to exercise slight care or diligence or the entire absence of care; thoughtless disregard of consequences without exerting any effort to avoid them. To be a ground for removal, the neglect of duty must be both gross and habitual. - Breach of trust and confidence, as a just cause for termination of employment is premised on the fact that the employee holds a position of trust and confidence. Managerial employees natural hold such positions. As long as there is some basis for such loss of confidence, a managerial employee may be dismissed. The finding of guilt or innocence in a charge of gross and habitual neglect of duty does not preclude the finding of guilt or innocence in a charge of breach of trust and confidence. Management has the prerogative to discipline its employees and to impose appropriate penalties on erring workers pursuant to company rules and regulations. To constitute a ground for a valid dismissal, negligence must be gross and habitual. Simple negligence, which does not cause any loss or damage, is not a valid ground for dimissal.

Jumuad was a managerial employee in this case holding a position of trust and confidence. And although she was not involved in the incidents, based on the principal of respondent superior (or command responsibility alone) Jumuad may be made liable. Jumuad willfully breached her duties as to be unworthy of the trust and confidence of the company.

Gross negligence is the want of even slight care, acting or omitting to act in a situation where there is duty to act, not inadvertently but willfully and intentionally, with a conscious indifference to consequences insofar as other persons may be affected. Habitual neglect,

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Lima Land v. Cuevas

Monday) to show that it was an accommodation, an accepted practice in the office. She placed the money and the original auxiliary receipt inside her drawer underneath all the other files. She was only able to remit the said payment after almost 4 months. A memorandum was sent to her, placing her under preventive suspension pending the investigation of the incident. MERALCO considered her acts as misappropriation or withholding of company funds. Beltran was terminated.

MERALCO.

on the other hand, connotes repeated failure to perform one’s duties for a period of time, depending upon the circumstances.

Lima entered into several lease agreements known as “arriendo contracts” with different persons whereby [the former transferred to the latter] its right to harvest [coconuts as well as other fruits planted on the lands it owned] in consideration of certain monetary equivalent. TIn February 2000, irregularities in [the] arriendo collections were discovered. Petitioners formed an investigating panel to conduct a thorough investigation on the status of the collections. The initial findings of the investigating panel revealed fraudulent activities and irregularities committed by the Private Respondent relative to the Company funds. Consequently, Private Respondent was served with a notice to explain and was placed under preventive suspension on May 22, 2002. She was, thereafter, ordered to turn over all documents and keys in her possession to Mrs. Venus Quieta. Private Respondent filed a Complaint

The loss of trust and confidence must be based not on ordinary breach by the employee of the trust reposed in him by the employer, but, in the language of Article 282 (c) of the Labor Code, on willful breach. A breach is willful if it is done intentionally, knowingly and purposely, without justifiable excuse, as distinguished from an act done carelessly, thoughtlessly, heedlessly or inadvertently. It must rest on substantial grounds and not on the employer’s arbitrariness, whims, caprices or suspicion; otherwise, the employee would eternally remain at the mercy of the employer. There must, therefore, be an actual breach of duty committed by the employee which must be established by substantial evidence.

The burden of proof required in labor cases must be amply discharged. In this case, the supposed function of respondent – monitoring duties and activities of other employees – is not subsumed in what petitioners claim as respondent's duties which are (a) to manage, direct and control record-keeping and financial reportorial requirements; (b) to ensure the accuracy and integrity of all financial reports; (c) to be responsible for the funds management and financial planning activities of the company; and (d) to manage the disbursement of funds. Moreover, logic dictates that the monitoring of the duties and activities of the employees who are reporting at the Batangas site would fall on the person appointed to oversee the operations of the company in that area. In the present case, the Batangas site where the arriendo collections were made was

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with the Labor Arbiter for illegal suspension, illegal dismissal, and non-payment of salaries, holiday pay, service incentive leave pay and 13th month pay

managed by an estate manager in the person of one Jonas Senia.

Elmer Lopez v. Keppel Bank Phil

Lopez was a Branch Manager of Keppel Bank before he was dismissed after disregarding the bank’s order to not issue one of their clients 2 POs. He subsequently filed a complaint for illegal dismissal.

Lopez was guilty of loss of confidence and trust for issuing said POs against the bank’s direct orders and was validly dismissed. According to the court, as branch manager, Lopez clearly occupied a "position of trust" since his stay in the service depended on the employer's trust and confidence in him and on his managerial services. Due to his blatant disregard of the bank’s instructions, it became apparent that they cannot in the future trust Lopez as a manager to follow directives from higher authorities on business policy and directions and that the bank can be placed at risk if this kind of managerial attitude will be repeated, especially if it becomes an accepted rule among lower managers.

Guidelines for the application of loss of confidence as provided in the case of Nokom v. NLRC: (1) loss of confidence, should not be simulated; (2) it should not be used as a subterfuge for causes which are improper, illegal or unjustified; (3) it may not be arbitrarily asserted in the face of overwhelming evidence to the contrary; and (4) it must be genuine, not a mere afterthought to justify an earlier action taken in bad faith.

Cathedral School of Technology v. NLRC

Petitioner school began receiving complaints' from students and employees about private respondent's difficult personality and sour disposition at work. Petitioner informed private respondent of the

There was valid cause for her dismissal.

The reason for which private respondent's services were terminated, namely, her unreasonable behavior and unpleasant deportment in dealing with the people she closely works

Loss of confidence should ideally apply only to: (1) cases involving employees occupying positions of trust and confidence (managerial employees, i.e., those vested with the powers and prerogatives to lay down management policies and/or to hire, transfer, suspend, lay-off, recall, discharge, assign or discipline employees, or effectively recommend such managerial actions.), or (2) situations where the employee is routinely charged with the care and custody of the employer's money or property (cashiers, auditors, property custodians, or those who, in the normal and routine exercise of their functions, regularly handle significant amounts of money or property).

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Lim v. NLRC

St. Luke's Med Center v. Fadrigo

negative reports received by her office regarding the latter's frictional working relationship with co-workers and students and reminded private respondent about the proper attitude and behavior that should be observed in the interest of peace and harmony in the school library. In anger, she resigned and stormed out of the office in discourteous disregard and callous defiance of authority. Petitioner sent a letter accepting her resignation. Petitioner was a Staff Accountant working for Pepsi (private respondent). Petitioner's overall performance was subjected to the company's evaluation rating system. Under the old system, she first garnered ratings of "superior" then later on, "commendable" then "C-" (commendable minus). Under the new system however, she was continuously rated as "Below Target" and "On Target". She complained about the results asking for reevaluation which she was rewarded. However, still unsatisfied by the results, she wrote letters to higher management (going up to management in Japan). Instead of waiting for Japanese manager to investigate, they asked her to voluntarily resign. When she refused, she was verbally informed of her termination for gross inefficiency. Fadrigo was the Customer Affairs Department Manager of petitioner SLMC. As such, she supervised the Wellness Program Office (WPO), which administers SLMC’s check up packages. A doctor complained to the Corporate President of the SLMC

with in the course of her employment, is analogous to the other "just causes" enumerated under Art 282 of the Labor Code.

In this case, the supposed function of respondent – monitoring duties and activities of other employees – is not subsumed in what petitioners claim as respondent's duties which are (a) to manage, direct and control record-keeping and financial reportorial requirements; (b) to ensure the accuracy and integrity of all financial reports; (c) to be responsible for the funds management and financial planning activities of the company; and (d) to manage the disbursement of funds.

Moreover, logic dictates that the monitoring of the duties and activities of the employees who are reporting at the Batangas site would fall on the person appointed to oversee the operations of the company in that area. In the

Art 282. Gross inefficiency falls within the purview of other causes analogous to the foregoing in Art 282 (e). One is analogous to another if it is susceptible of comparison with the latter either in general or in some specific detail or has a close relationship to the other. Gross inefficiency is closely related to gross neglect: both involve specific acts of omission on the part of the employee resulting in damage to the employer or to his business. Failure to observe prescribed standards of work, or to fulfill reasonable work assignments due to inefficiency may constitute just cause for dismissal. Since in this case, petitioner continuously failed to meet the company's evaluation standards, dismissal based on this ground would have been valid. Analogous cases: insubordination, gross inefficiency, incompetence

Burden of proving that employee's dismissal from employment was for just cause rests upon the employer. In this case, she was not granted a hearing. She was asked to voluntarily resign. And when she refused, she was given notice of termination.

Gross inefficiency is closely related to gross neglect, for both involve specific acts of omission on the part of the employee resulting in damage to the employer or to his business; hence, such

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EG & Const Corp v Sato

regarding her conversation with a trainee and a casual employee, who then clarified the matter with the WPO, asking if it was WPO’s practice to reject patients. While on her rest day, Fadrigo received a phone call from SLMC’s Associate Director for Corporate Affairs informing her of the incident. Fadrigo was further directed to instruct the trainee and the casual employee not to report for work the following day. Fadrigo called the office, as well as the two’s personal numbers but was not able to talk with them. She then left a message with a senior associate at the WPO to instruct the two not to report for work tomorrow and to wait for her at her office. The two reported for work the next day and were then instructed by the Associate Director to go home. When Fadrigo arrived, the two had gone. First notice was sent for her to explain her side. She was eventually dismissed. Sato was hired as a grader operator by EG Corp. On July 22, 2004, petitioners told Sato that they could no longer afford to pay his wages, and he was advised to look for employment in other construction companies. Sato, however, found difficulty in finding a job because he had been blacklisted in other construction companies and was prevented from entering the project sites of petitioners. Nilo Berdin was hired by petitioners in March 1991 as a steelman/laborer; Anecito S. Parantar, Sr. was hired in February 1997 as a steelman; and Romeo M. Lacida, Jr. was hired in March 2001 as

present case, the Batangas site where the arriendo collections were made was managed by an estate manager in the person of one Jonas Senia.

The reason why respondents failed to report for work was because petitioner corporation barred them from entering its construction sites. It is a settled rule that failure to report for work after a notice to return to work has been served does not necessarily constitute abandonment.

must be gross and habitual to constitute a valid ground for termination. A single or isolated act of negligence does not constitute a just cause for the dismissal of the employee.

The intent to discontinue the employment must be shown by clear proof that it was deliberate and unjustified. Petitioner corporation failed to show overt acts committed by respondents from which it may be deduced that they had no more intention to work. Respondents’ filing of the case for illegal dismissal barely four (4) days from their alleged abandonment is totally inconsistent with our known concept of what constitutes abandonment.

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a laborer. On July 24, 2004, the project engineer of respondents Berdin, Parantar, and Lacida instructed them to affix their signatures on various documents. They refused to sign the documents because they were written in English, a language that they did not understand. Irked by their disobedience, the project engineer terminated their employment. On the same date, they were given their weekly wages. However, the wages that were paid to them were short of three (3) days’ worth of wages, as penalty for their refusal to sign the documents. The following day, they were not allowed to enter the work premises. Dimagan v. Dacworks United

Batongbacal v. Associated Bank

Dimagan was a stockholder of Dacworks before he was dismissed for allegedly abandoning his employment by being on AWOL. Dimagan was claiming, however, that he did not abandon his employment and that the company’s harsh and humiliating treatment of him (demoting him to technician position) was tantamount to constructive dismissal.

Dacworks failed to prove that Dimagan not abandoned his employment. The court held that he was in fact constructively dismissed through the company’s harsh treatment of him.

According to the court, his absence was caused by the unwarranted demotion in rank that was imposed upon him by respondents and not by any intention to sever employment ties with them. The court also explained that his filing of the instant complaint for illegal dismissal indubitably negates the allegation of abandonment because had he intended to forsake his job, then he would not have found it necessary to institute a case against Dacworks.

Petitioner Atty. Batongbacal was the assistant VP of a bank. Said bank merged with another bank. In the new bank, petitioner resumed his

The bank cannot legally dismiss petitioner for refusal to tender his courtesy resignation which the bank required in line with its

It should be emphasized that resignation per se means voluntary relinquishment of a position or office. Adding the word "courtesy"

Abandonment is the deliberate and unjustified refusal of an employee to resume his employment. Elements of abandonment: (1) the employee must have failed to report for work or must have been absent without valid or justifiable reason; and (2) there must have been a clear intention on the part of the employee to sever the employer-employee relationship manifested by some overt act.

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Manlimos v. NLRC

Elcee Farms Inc v. NLRC

position as AVP. The bank's board met and approved a resolution requiring bank officers to immediately tender their courtesy resignations in an effort to give the new management be given the necessary flexibility in streamlining the operations of the Bank. Petitioner did not submit his courtesy resignation but nonetheless received a letter from the steering committee “accepting” his resignation. New ownership/management group acquired complete ownership of the corporation. Petitioners were advised of such change and continued to work for the new owner but were however, terminated 2 months after. The new owner publicized notice for hiring workers indicating that previously-separated employees could be accepted on probationary basis. Petitioners were rehired on piece rate/task basis. Petitioners were dismissed a month later for having committed acts prejudicial to the interest of new management.

reorganization plan. By directing its employees to submit letters of courtesy resignation, the bank in effect forced upon its employees an act which they themselves should voluntarily do.

did not change the essence of resignation.

Change of ownership is valid exercise of management prerogative as long as done in good faith

Where there is change of ownership in good faith, the transferee is under no legal duty to absorb the transferor’s employees as there is no law compelling such absorption. The most the transferee may do, for reasons of public policy and social justice, is to give preference to the qualified separated employees in the filing of vacancies in the facilities of the purchaser. Petitioners were effectively separated from work due to a bona fide change of ownership and were paid separation pay which they freely and voluntarily accepted

Semillano and one hundred fortythree (143) other complainants were all regular farm workers in Hacienda Trinidad, which was owned and operated by Elcee Farms. The president of the Elcee Farms, Garnele, sub-leased Hacienda Trinidad to Daniel Hilado. In the contract of lease, it has been stipulated that the employment of 120 of the former’s employees should be continued by the latter. It was, however, silent as to the

Elcee Farms should be held liable to the employees. The lease to Hilado was a virtual termination of the employer-employee relationship. Moreover, there is no showing that HILLA assumed Elcee Farms’s obligation to pay the various benefits due to the workers from their employment with Elcee Farms. There was a cessation of operations of Elcee Farms, which renders it liable for separation pay

If the termination of employees is caused by the cessation of business, the employer must grant separation pay to the terminated employees, as provided for by Article 283, LC.

A “courtesy” resignation is not valid if it’s not voluntary.

Different from withdrawing operations altogether.

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Manila Electric Co v. NLRC

benefits that would accrue to the employees. A CBA with the United Sugar Farmers’ Organization (USFO) has been arrived at, containing a closed shop provision. Should the employees/laborers refuse and fail to join and affiliate with the UNION within such a period of time, said employees/laborers shall be dismissed by the EMPLOYER upon recommendation by the UNION. The complainants refused to join and were thus terminated. Jeremias C. Cortez, Jr. was employed on probationary status by petitioner Manila Electric Company (Meralco) on September 15, 1975 as a lineman driver. Six months later, he was regularized as a 3rd class linemandriver. In 1977, and until the time of his dismissal, he worked as 1st class lineman-driver. Characteristics, however, of private respondent’s service with petitioner is his perennial suspension from work.

to its employees.

This Court has upheld a company’s management prerogatives so long as they are exercised in good faith for the advancement of the employer’s interest and not for the purpose of defeating or circumventing the rights of the employees under special laws or under valid agreements. In the case at bar, the service record of private respondent with petitioner is perpetually characterized by unexplained absences and unauthorized sick leave extensions. The nature of his job i.e. as a lineman-driver requires his physical presence to minister to incessant complaints often faulted with electricity. The penchant of private respondent to continually incur unauthorized absences and/or a violation of petitioner’s sick leave policy finally rendered his dismissal as imminently proper.

Article 283 of the Labor Code enumerates the just causes for termination. Among such causes are the following: a) Serious misconduct or willful disobedience by the employee of the lawful orders of his employers or representatives in connection with his work. b) Gross and habitual neglect by the employee of his duties.

This cause includes gross inefficiency, negligence and carelessness. Such just causes are derived from the right of the employer to select and engage his employees. For indeed, regulation of manpower by the company clearly falls within the ambit of management prerogative. This court had defined a valid exercise of management prerogative as one which covers: hiring work assignment, working methods, time, place and manner of work, tools to be used, processes to be followed, supervision of workers, working regulations, transfer of employees, work supervision, lay-off of workers, and the discipline, dismissal and recall of workers. Except as provided for, or limited by, special laws, an employer is free to regulate, according

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RB Michael Press v. Galit

Galit was held to be in willful violation of company authority when he refused to render overtime service after being ordered to do so. In considering his dismissal, RB Michael Press took into account his being tardy for a total of 190 times, totaling to 6,117 minutes, and his being absent without leave for a total of 9 ½ days. He subsequently filed a complaint for illegal dismissal contending, among other things, that his tardiness and absences could no longer serve as basis for his termination as they have already been deducted from his salary as a form of penalty and that because he was not subjected to any other admonition or penalty for tardiness, petitioners then had condoned the offense or that the infraction is not serious enough to merit any penalty.

His tardiness and absences were validly considered in his dismissal. The court explained that the mere fact that the numerous infractions of Galit have not been immediately subjected to sanctions cannot be interpreted as condonation of the offenses or waiver of the company to enforce company rules.

The also explained citing the case of Filipio v. The Honorable Minister that past infractions for which the employee has suffered the corresponding penalty for each violation cannot be used as a justification for the employee’s dismissal for that would penalize him twice for the same offense. At most, it was explained, “these collective infractions could be used as supporting justification to a subsequent similar offense.” In contrast, the RB Michael Press in the case at bar did not impose any punishment for the numerous absences and tardiness of respondent and thus, said infractions can be used collectively by petitioners as a ground for dismissal since the deductions on Galit’s salary for his numerous infractions was only proper pursuant to the principle of “a day’s pay for a day’s work”

Century Canning Corp v. Ramil

Respondent was terminated for loss of trust and confidence. He was allegedly involved in the forgery of CAPEX forms and the signature of an officer. Petitioner corporation argues that aside from respondent's involvement in the forgery of the CAPEX form, his past violations of company rules and regulations (tardiness) are more than sufficient grounds to justify his termination from employment.

Petitioner's reliance on respondent's previous tardiness in reporting for work as a ground for his dismissal is not meritorious. His previous offenses were entirely separate and distinct from his latest alleged infraction of forgery. Hence, the same could no longer be utilized as an added justification for his dismissal. Besides, respondent had already been sanctioned for his priorinfractions. To consider these offenses as justification for his

The correct rule has always been that such previous offense may be used as valid justification for dismissal from work only if theinfractions are related to the subsequent offense upon which the basis of termination is decreed.

to his own discretion and judgment, all aspects of employment. Habitual tardiness is a form of neglect of duty - lack of initiative, diligence, and discipline to come to work on time everyday exhibit the employee’s deportment towards work. Habitual and excessive tardiness is inimical to the general productivity and business of the employer. This is especially true when the tardiness and/or absenteeism occurred frequently and repeatedly within an extensive period of time.

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dismissal would be penalizing respondent twice for the same offense.

Ramoran v. Jardine

Gustilo v. Wyeth Phil

Petitioner was junior accountant in petitioner-company. She was found to have tampered with the dates of her overtime slips making it seem like she worked more than she actually did. She was acquitted in criminal cases filed against her by the company. She argues that based on her acquittal, her dismissal may now be overturned.

Petitioner NOT DEPRIVED OF DUE PROCESS. Court found no basis to mitigate her liability

Gustilo was employed by Wyeth Phil. Inc. as a pharmaceutical territory manager. He is tasked to submit periodic reports of his daily call visits, monthly itinerary, and weekly locator and incurred expenses in connection with his visits in hospitals, pharmacies, drugstores and physicians concerned. He submitted his weekly expense report late. As a result, a notice was sent to him reprimanding him for such. Upon committing the same infraction, he was suspended for five days, and subsequently for fifteen days for repeating the same. In an integration of Wyeth’s pharmaceutical products with its sister company, Gustilo was tasked to promote four products. He committed to make an average of 18 daily calls to physicians, submit

His termination was valid, being a is habitual offender with numerous contraventions of company rules.Petitioner did not only violate the aforestated company rules and regulations. He also submitted several false and falsified documents to the company. In short, he is dishonest.

The essence of due process is to be found in the reasonable opportunity to be heard and submit any evidence one may have in support of one’s defense Due process does not necessarily require conducting an actual hearing but simply giving the party concerned due notice and affording an opportunity or right to be heard

Not the first time that petitioner was charged with falsification by Jardine. She previously served a 5-day suspension for tampering with a receipt making it seem like she spent 6980 for glasses when she really spent only P100

Although she was already entitled to dismissal for this violation, due to her voluntary admission and due to humanitarian reasons, she was only given a 5 day suspension She was warned that “any future violation” of the same nature, irrespective of the time it is committed would result in the imposition of the maximum penalty of dismissal

A series of irregularities when put together may constitute serious misconduct, which under Article 282 of the Labor Code, as amended, is a just cause for dismissal.

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Santos v. NLRC

promptly all periodic reports, and ensure 95% territory program performance for every cycle. He failed to do as he promised. Consequently, he was sent two separate notice for willful violation of company rules and regulations and directing him to submit a written explanation. Eventually, his employment was terminated. Two teachers had an affair when they are both married to other people. The rumors spread in the school. On November 9, 1990, they were barred from reporting for work and was not allowed to enter the private respondent’s premises, effectively dismissing them from their employment.

When a teacher engages in extramarital relationship, especially when the parties are both married, such behavior amounts to immorality, justifying his termination from employment. Court explained nature of being a teacher and its importance of upholding a certain moral image

Sampaguita Garments Corporation v. NLRC

Santos was an employee of Sampaguita Garments who got involved in 2 cases: one before the LA and NLRC and one before the regular criminal courts for her alleged theft of company materials. She was contending that the NLRC decision ordering her reinstatement should be enforced despite her conviction for the crime of theft before the regular courts.

Santos should not be reinstated.

Bughaw Jr v. Treasure Island Industrial

Petitioner was implicated by coworker who was caught doing drugs. He was subsequently suspended and dismissed for using illegal drugs within company premises during working hours, and for refusal to attend the administrative hearing and submit written explanation on

Petitioner not illegally dismissed. This Court took judicial notice of scientific findings that drug abuse can damage the mental faculties of the user. It is beyond question therefore that any employee under the influence of drugs cannot possibly continue doing his duties without posing a serious

Generally, once a judgment has become final and executory it can no longer be disturbed, such is subject to the exception that it may be reconsidered for the correction of clerical errors or where supervening events render its execution impossible or unjust in cases of which the interested party may ask the court to modify the judgment to harmonize it with justice and the facts. The charge of drug abuse inside the company's premises and during working hours against petitioner constitutes serious misconduct, which is one of the just causes for termination. Misconduct is improper or wrong conduct. It is the transgression of some established and definite rule

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Elsa S. Malig-on v. Equitable General Services

Barroga v. Data Center College of the Phil

the charges hurled against him.

threat to the lives and property of his co-workers and even his employer.

of action, a forbidden act, a dereliction of duty, willful in character, and implies wrongful intent and not merely an error in judgment. The misconduct to be serious within the meaning of the Act must be of such a grave and aggravated character and not merely trivial or unimportant. Such misconduct, however serious, must nevertheless, in connection with the work of the employee, constitute just cause for his separation.

Respondent hired petitioner as a janitress in its janitorial services. After 6 years, Malig on’s immediate supervisor told her that company would be assigning her to another client. This did not happen even after several follow ups. Company alleges that she stopped reporting for work Feb 16 without giving reason and that company wrote her 2 letters asking her to explain her continued absence.

Constructively dismissed.

Burden of proving that he was dismissed for just cause lies with the employer. When employer claims that employee resigned from work, burden is on employer to prove he did so willingly. To ascertain intent: look to circumstances must be consistent with employees intent to give up work.

IN THIS CASE: Court was not convinced. Petitioner was quick to point out that she wrote the letter after being told she needed to resign so she could be cleared for her next assignment

Barroga was employed as an Instructor in Data Center College Laoag City branch in Ilocos Norte. In a memo, he was transferred to University of Northern Philippines (UNP) in Vigan, Ilocos Sur where the school had a tie-up program, for which he was granted, in addition to

The transfer is not tantamount to constructive dismissal. His appointment as Head for Education was in a temporary capacity, and thus terminable at the pleasure of the employer. Moreover, Barroga’s employment contract states that the College

Constructive dismissal exists when demotion in rank or diminution in pay is clearly established by substantial evidence.

Constructive Dismissal: quitting because continued employment is rendered impossible, unreasonable or unlikely, or because of a demotion in rank or a diminution of pay; exists when there is a clear act of

Petitioner’s floating status ran more than 6 months. Notices that company alleges to have sent her informing her of termination could not have been valid notice as they were sent after the 6 month period i.e. after they constructively dismissed her.

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Nippon Housing Phil Inc v. Maiah Leynes

his monthly salary, a P1,200.00 allowance for board and lodging. He was recalled to the Laoag campus. In another memo, he was transferred to Data Center College Bangued, Abra branch as Head for Education/Instructor due to an urgent need for an experienced officer and computer instructor thereat. He declined to accept his transfer in the Abra branch in view of the deteriorating condition of his father and the absence of additional remuneration to defray expenses for board and lodging which constitutes implicit diminution of his salary. The College suspended his scholarship for post-graduate studies. He filed a complaint for constructive dismissal. Disappointed with the management decision over a dispute with an employee, Leynes asked for an emergency leave of absence for the supposed purpose of coordinating with her lawyer regarding her resignation letter. While NHPI offered the Property Manager position to Engr. Carlos Jose as a consequence Leynes' signification of her intention to resign, it also appears that Leynes sent another letter to Reyes by telefax on the same day, expressing her intention to return to work and to call off her planned resignation. Having subsequently reported back for work and resumed performance of her assigned functions, Leynes was constrained to send out a written protest regarding the verbal information she supposedly received from Reyes that a substitute has

has the prerogative to assign him in any of its branches or tie-up schools as the necessity demands. In any event, it is management prerogative. Data College has been under financial constraints which necessitated it to suspend Barroga’s scholarship for the latter’s post-graduate studies.The absence of additional allowances to defray expenses in connection with his transfer to the Abra branch does not amount to a diminution of pay as such grant is not pursuant to a company policy nor practice.

Although the CA correctly found that the record is bereft of any showing that Leynes was unacceptable to BGCC, the evidence the parties adduced a quo clearly indicates that petitioners were not in bad faith when they placed the former under floating status.

discrimination, insensibility or disdain by an employer which becomes unbearable for the employee to continue his employment.

The rule is settled, however, that "off-detailing" is not equivalent to dismissal, so long as such status does not continue beyond a reasonable time and that it is only when such a "floating status" lasts for more than six months that the employee may be considered to have been constructively dismissed. A complaint for illegal dismissal filed prior to the lapse of said six-month and/or the actual dismissal of the employee is generally considered as prematurely filed.

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Pharmacia & UpJohn v. Albayda

Morales v. Harbor Centre Port Terminal

already been hired for her position. Leynes was relieved her from her position and directing her to report to NHPI's main office while she was on floating status. Albayda was a District Sales Manager for Pharmacia who refused to be transferred to a different sales district which ultimately led to his dismissal. He filed a complaint against the company saying that their attempts to transfer/reassign him over his objections were tantamount to constructive dismissal since he has already stayed in his district for more that 2 decades and his reassignment to a different location will be detrimental to him and his family.

Petitioner Morales was the Division Manager of the Accounting Department of HCPTI. He was reassigned to Operations Cost Accounting. Morales protested that his reassignment was a clear demotion since the position to which he was transferred was not even included in HCPTI’s plantilla. In response to his grievance, an interoffice memorandum was issued to the effect that “transfer of employees is a management prerogative” and that HCPTI had “the right and responsibility to find the perfect balance between the skills and abilities of employees to the needs of the business.” Morales filed a complaint against respondents for

Albayda was validly dismissed as his refusal to be reassigned was is clearly a defiance of the lawful order of his employer, and a ground to terminate his services pursuant to Article 282, paragraph (a) of the Labor Code. The court upheld the company’s exercise of management prerogative to transfer or assign employees from one office or area of operation to another, rovided there is no demotion in rank or diminution of salary, benefits, and other privileges, and the action is not motivated by discrimination, made in bad faith, or effected as a form of punishment or demotion without sufficient cause. An employer may transfer or assign employees from one office or area of operation to another, provided there is no demotion in rank or diminution of salary, benefits, and other privileges, and the action is not motivated by discrimination, made in bad faith, or effected as a form of punishment or demotion without sufficient cause. In this case, Morales' reassignment was held by the Court to be a demotion, as such, his transfer was improper.

The court also took note of the fact that that in respondent’s employment application and contract of employment, he agreed to be assigned to any work or workplace as may be determined by the company whenever the operations require such assignment and that the nature of employment of a sales man or sales manager is that it is mobile or ambulant being always seeking for possible areas to market goods and services

TEST OF VALIDITY OF TRANSFER: To determine the validity of the transfer of employees, the employer must show that the transfer is not unreasonable, inconvenient, or prejudicial to the employee; nor does it involve a demotion in rank or a diminution of his salaries, privileges and other benefits. Should the employer fail to overcome this burden of proof, the employee's transfer shall be tantamount to constructive dismissal.

Constructive dismissal exists where there is cessation of work because "continued employment is rendered impossible, unreasonable or unlikely, as an offer involving a demotion in rank or a diminution in pay" and other benefits. Constructive dismissal may, likewise, exist if an act of clear discrimination, insensibility, or disdain by an employer becomes so unbearable on the part of the employee that it could foreclose any choice by him except to forego his continued employment.

In cases of a transfer of an employee, the rule is settled that the employer is charged with the burden of proving that its conduct and action are for valid and legitimate grounds such as genuine business necessity and that the transfer is not unreasonable, inconvenient or prejudicial to the employee. If the employer cannot overcome this burden of proof, the employee’s transfer shall be tantamount to unlawful constructive dismissal.

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Phil Telegraph v. CA

Jose Artificio v. NLRC

Gatbonton v. NLRC

constructive dismissal. Petitioner came up with RELOCATION and RESTRUCTURING PROGRAM designed to sustain retail operations, decongest workforce, lower expenses in hiring and training new personnel, avoid retrenchment of employees occupying redundant positions. Respondents were given the option to choose whether they could be transferred. They were offered benefits and a salary increase with the transfer.

Artificio was employed as security guard by respondent RP Guardians Security Agency, Inc., a security agency. Artificio had a heated argument with a fellow security guard who submitted a confidential report, requesting that Artificio be investigated for leaving his post during night shift duty to see his girlfriend at a nearby beerhouse. Another security guard sent a report stating that Artificio arrived at the office under the influence of liquor, and that upon knowing that no salaries were to be distributed then, he bad-mouthed the employees of the agency and even threatened to “arson” the office. Artificio was temporarily relieved from his post and placed under preventive suspension pending his investigation. Petitioner Renato S. Gatbonton is an associate professor of respondent Mapua Institute of Technology (MIT), Faculty of Civil Engineering. Sometime in November 1998, a civil

Illegally dismissed. Transfer was considered a promotion. Employees had the right to refuse, cannot be considered willful disobedience/ insubordination. No law that compels an employee to accept a promotion for the reason that a promotion is in the nature of a gift or reward which a person has a right to refuse

With regard to PAY: they were promoted from a lower job grade to a higher one. Transfer would not result in diminution in pay benefit and privilege since the salaries would be larges if not the same plus relocation packages. Cost of living in the province is much lower than city = higher purchasing power.

Preventive suspension was proper. Artificio’s preventive suspension was justified since he was employed as a security guard tasked precisely to safeguard respondents’ client. Due to the alleged, and proven, serious allegations of conduct unbecoming a security guard, his continued employment poses a threat to the respondent. Moreover, the company has the right to regulate all aspects of employment, provided such is performed in good faith.

Preventive suspension is justified where the employee’s continued employment poses a serious and imminent threat to the life or property of the employer or of the employee’s co-workers. Without this kind of threat, preventive suspension is not proper.

R.A. No. 7877 imposed the duty on educational or training institutions to “promulgate rules and regulations in consultation with and jointly approved by the

The Court finds that there is no sufficient basis to justify his preventive suspension. Under the Mapua Rules, an accused may be placed under preventive

With regard to responsibility: Promotion is the advancement form one position to another with an increase in duties and responsibilities as authorized by law and usually accompanied by an increase in salary. Indispensable element of promotion is that there must be an advancement from one position to another or an upward vertical movement of the employee’s rank or position

Inpetitioner’s case, there is no indication that petitioner’s preventive suspension may be based on the foregoing

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engineering student of respondent MIT filed a letter-complaint against petitioner for unfair/unjust grading system, sexual harassment and conduct unbecoming of an academician. Pending investigation of the complaint, respondent MIT, through its Committee on Decorum and Investigation placed petitioner under a 30-day preventive suspension effective January 11, 1999.

employees or students or trainees, through their duly designated representatives, prescribing the procedures for the investigation of sexual harassment cases and the administrative sanctions therefor.” Petitioner’s preventive suspension was based on respondent MIT’s Rules and Regulations for the Implemention of the Anti-Sexual Harassment Act of 1995, or R.A. No. 7877.

suspension during pendency of the hearing under any of the following circumstances: (a) if the evidence of his guilt is strong and the school head is morally convinced that the continued stay of the accused during the period of investigation constitutes a distraction to the normal operations of the institution; or (b) the accused poses a risk or danger to the life or property of the other members of the educational community.

Edge Apparel Inc v. NLRC

Employees here were removed from their employment pursuant to Edge’s retrenchment program. There was a contention as to WON they should be granted an additional ½ month pay per year of service pursuant to the NLRC ruling on this case saying that retrenchment could also be considered as redundancy.

FASAP v PAL (2008)

PAL retrenched 5,000 of its employees, including more than 1,400 of its cabin crew personnel.

Payment of additional separation pay is not proper. According to the court, the amount of separation pay depends on the ground for the termination of employment. Since the employees’ termination is based on retrenchment and not on redundancy, they should only receive separation pay of ½ month per year of service. PAL's retrenchment scheme was not justified. It failed to substantiate its claim of actual and imminent substantial losses. Also, when PAL implemented Plan 22, instead of Plan 14, which was what it had originally made known to its employees, it could not be said that it acted in a manner compatible with good faith. The retrenchment of cabin crew personnel due to "other reasons" were not specifically stated and shown to be for a valid cause. This is not allowed because it has no

The law acknowledges the right of every business entity to reduce its work force if such measure is made necessary or compelled by economic factors that would otherwise endanger its stability or existence and in exercising its right to retrench employees, the firm may choose to close all, or a part of, its business to avoid further losses or mitigate expenses. Established Standards for Valid Retrenchment: 1.That retrenchment is reasonably necessary and likely to prevent business losses which, if already incurred, are substantial, serious, actual and real, or if only expected, are reasonably imminent as perceived objectively and in good faith by the employer;

circumstances. It does not show that evidence of petitioner’s guilt is strong and that the school head is morally convinced that petitioner’s continued stay during the period of investigation constitutes a distraction to the normal operations of the institution; or that petitioner poses a risk or danger to the life or property of the other members of the educational community.

Note: Please read the digest for this case as each standard was thoroughly discussed by the Court.

2. That the employer served written notice both to the employees and to the DOLE at

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basis in fact and in law.

least one month prior to the intended date of retrenchment; 3. That the employer pays the retrenched employees separation pay equivalent to one (1) month pay or at least one-half (1/2) month pay for every year of service, whichever is higher 4. That the employer exercises its prerogative to retrench employees in good faith for the advancement of its interest and not to defeat or circumvent the employees' right to security of tenure; and, 5. That the employer used fair and reasonable criteria in ascertaining who would be dismissed and who would be retained among the employees, such as status, efficiency, seniority, physical fitness, age, and financial hardship for certain workers.

FASAP v PAL (2009)

Lambert Pawnbrokers & Jewelry Corp v Helen Binamira

Same facts as previous. Court here focused on arguments of PAL's counsel who argued that the principal and true reason why PAL had to implement the mass lay-off of cabin personnel was not the downsizing but the June 5, 1998 pilots' strike where approximately 600 pilots abandoned their plans and simultaneously refused to fly. No pilots= no plans flying=no place for employment of cabin attendants. Lim is a Malaysian national with various businesses in the Philippines, one of which is Lambert Pawnbrokers. Helen Binamira, sisterin-law of Lim’s wife, was hired as an

Pilots' strike was NOT VALID CAUSE FOR RETRENCHMENT.

This was an IMMEDIATE RESPONSE to an EMERGENCY SITUATION (PAL claims to have had daily loses of P100m and P50m lost fixed costs). In order for retrenchment to be valid, ALL elements under Art 283 of the LC must be present. The absence of ONE ELEMENT causes the retrenchment to be an IRREGULAR EXERCISE OF MANAGEMENT PREROGATIVE

There was no valid dismissal based on retrenchment. There was no evidence at all that the company was suffering from business losses. Although a sharp drop in the

Losses must be supported by sufficient and convincing evidence.

It is the employer’s obligation to exhaust all other means to avoid further losses without retrenching its employees. Knee jerk solution to address the situation of extreme urgency caused by the strike clearly shows that it did not abide by the requirements under Art 283. Retrenchment is the termination of employment initiated by the employer through no fault of and without prejudice

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appraiser and designated as Vault Custodian. Helen received a letter terminating her employment effective that same day, in view of business losses necessitating retrenchment. She filed a case for illegal dismissal.

Andrada v NLRC

Legend sent notice to the Department of Labor and Employment of its intention to retrench and terminate the employment of thirty-four (34) of its employees, The following dayLegend sent the 34 employees their respective notices of retrenchment, stating the same reasons for their retrenchment. It also offered the employees the following options, to wit: a. Temporary retrenchment/lay-off for a period not to exceed six months within which we shall explore your possible reassignment to other departments or affiliates, after six months and redeployment and/or matching are unsuccessful, permanent retrenchment takes place and separation pay is released. b. Permanent retrenchment and payment of separation pay and other benefits after the thirty (30) days’ notice has lapsed; or c. Immediate retrenchment and payment of separation pay, benefits and one month’s salary in lieu of

income of the company has been shown, a mere decline in gross income cannot in any manner be considered as serious business losses. The same should be substantial, sustained and real. There was also no showing that petitioners adopted other costsaving measures before resorting to retrenchment. The company also did not use any fair and reasonable criteria in ascertaining who would be retrenched. Moreover, no written notices were served. We rule that Legend failed to establish redundancy. It is not enough for a company to merely declare that positions have become redundant. It must produce adequate proof of such redundancy to justify the dismissal of the affected employees. Panlilio v. NLRC, we said that the following evidence may be proffered to substantiate redundancy: “the new staffing pattern, feasibility studies/proposal, on the viability of the newly created positions, job description and the approval by the management of the restructuring.” In another case, it was held that the company sufficiently established the fact of redundancy through “affidavits executed by the officers of the respondent PLDT, explaining the reasons and necessities for the implementation of the redundancy program.”

to the employees. It is resorted to during periods of business recession, industrial depression, seasonal fluctuations, or during lulls occasioned by lack of orders, shortage of materials, conversion of the plant to a new production program, or automation.

Redundancy exists where the services of an employee are in excess of what is reasonably demanded by the actual requirements of the enterprise. A position is redundant where it is superfluous, and superfluity of a position or positions may be the outcome of a number of factors, such as over hiring of workers, decreased volume of business, or dropping of a particular product line or service activity previously manufactured or undertaken by the enterprise.

Retrenchment, on the other hand, is used interchangeably with the term “lay-off.” It is the termination of employment initiated by the employer through no fault of the employee’s and without prejudice to the latter, resorted to by management during periods of business recession, industrial depression, or seasonal fluctuations, or during lulls occasioned by lack of orders, shortage of materials, conversion of the plant for a new production program or the introduction of new methods or more efficient machinery, or of automation. Simply put, it is an act of the employer of dismissing employees because of losses in the operation of a business, lack of work, and considerable reduction on the volume of

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notice to allow you to look for other employment opportunities. Curiously, on the same day, the Labor and Employment Center of the Subic Bay Metropolitan Authority advertised that Legend International Resorts, Inc. was in need of employees for positions similar to those vacated by petitioners.

Smart Communications v Regina Astorga

Astorga was part of Smart’s Corporate Sales Marketing Group/ Fixed Services Division who was dismissed from employment due to redundancy. Her division was closed upon the entering of the company in a joint venture with a Japanese company which in effect took over the work of Astorga’s former division. Even though the company undertook to absorb employees affected by the redundancy, Astorga still failed to qualify for a new position due to her inadequate work performance. She filed a complaint for illegal dismissal.

his business, a right consistently recognized and affirmed by this Court.

Astorga’s dismissal due to redundancy was valid. According to the court, while the scales of justice generally tilt in favor of workers, the fundamental law also guarantees the right of the employer to reasonable returns for his investment and as such is the case, acknowledgement must be given to the prerogative of the employer to adopt such measures as will promote greater efficiency, reduce overhead costs and enhance prospects of economic gains, albeit always within the framework of existing laws. In the end, the SC uphelp the validity of the reorganization and redundancy program undertaken by SMART. The court also considered that Astorga failed to present evidence to support her claims that the termination of her employment was illegal and tainted with bad faith.

The nature of redundancy as explained in the case of Wiltshire File Co., Inc. v. National Labor Relations Commission: Redundancy in an employer’s personnel force necessarily or even ordinarily refers to duplication of work. That no other person was holding the same position that private respondent held prior to termination of his services does not show that his position had not become redundant. Indeed, in any well organized business enterprise, it would be surprising to find duplication of work and two (2) or more people doing the work of one person

The characterization of an employee’s services as superfluous or no longer necessary and, therefore, properly terminable, is an exercise of business judgment on the part of the employer. The wisdom and soundness of such characterization or decision is not subject to discretionary review provided, of course, that a violation of law or arbitrary or malicious action is not shown.

Redundancy, for purposes of the Labor Code, exists where the services of an employee are in excess of what is reasonably demanded by the actual requirements of the enterprise. Succinctly put, a position is redundant where it is superfluous, and superfluity of a position or positions may be the outcome of a number of factors, such as overhiring of workers, decreased volume of business, or dropping of

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a particular product line or service activity previously manufactured or undertaken by the enterprise. Retrenchment or lay-off is the termination of employment initiated by the employer, through no fault of the employees and without prejudice to the latter, during periods of business recession, industrial depression, or seasonal fluctuations, or during lulls occasioned by lack of orders, shortage of materials, conversion of the plant for a new production program or the introduction of new methods or more efficient machinery, or of automation.

Eastridge Golf Club v Eastridge Labor Union

Petitioner terminated the employment of respondents on the ground that the operations of the F&B Department had been turned over to a concessionaire. Petitioner claim that it laid off the respondents due to company eorganization/downsizing and transfer of operations to a concessionaire. Respondents claim that their dismissal was not based on any of the causes allowed by law, and that it was effected without due process.

Respondents were illegally dismissed. Basically petitioner tried to use as an excuse the cessation of operations to justify its dismissal of employees. HOWEVER, in this case the Court held that petitioner merely simulated the transfer of its business (i.e. no cessation happened).

JPL Marketing Promotions v CA

Employees were merchandisers assigned at different establishments in 3 diff sities as attendants to one of the company's clients. Company advised employees that it would stop its direct merchandising activity in the areas where employees were assigned. They were advised to wait for further notice as they would be transferred to other clients

No termination of employment at all. They received a memo informing them of termination of the company's contract with their current client.

They were also advised that they were to be reassigned = NO SEVERANCE. Art 286 allows the bonafide suspension of operation of a business or undertaking for a period not exceeding 6 months wherein an employee is placed on FLOATING STATUS. In this case though, employees sought other employment even before the expiration of the 6 month period provided by law.

Crayons employed Pula as a Preparation Machine Operator. Pula suffered a heart attack, was brought to the hospital, and was confined for a week. Upon discharge, he was

Termination was invalid. Pula was able to obtain two different medical certifications attesting to his fitness to resume work. These certifications stand as

The requirement of a medical certificate under Article 284 cannot be dispensed with as such would sanction the unilateral and arbitrary determination by the

Crayons Processing v. Pula

ON THE OTHER HAND, closure or cessation of business is the complete or partial cessation of the operations and/or shutdown of the establishment of the employer. It is carried out to either stave off the financial ruin or promote the business interest of the employer. Unlike retrenchment, the employer does not need to present evidence of financial losses to justify such business decision. BENEFITS: not entitled to sep pay but entitled to 13th month and SIL pay. Note: The case focuses a lot on the entitlement and computation of benefits. However, the relevant part of this case with regards to the syllabus is that there was no termination but a suspension of operations. So, I guess this case highlights the effects of the lack of termination/mere suspension of operations on such benefits.

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Wuerth Phil Inc v Rodante Ynson

advised by the attending physician to take a leave of absence from work for three months, followed by a twoweek leave upon release of the results of his angiogram test. Eventually, he was able to return to work upon certification of his physician of his fitness to work. He suffered a relapse and was advised to take a leave for one month. He returned to work upon certification of fitness. However, he was not given any post or assignment, and was even asked to resign with an offer of financial assistance. He refused the offer and instead, filed a complaint for illegal dismissal. Wuerth Philippines, Inc. hired respondent Rodante Ynson, as its National Sales Manager (NSM) for Automotive. On January 24, 2003, he suffered a stroke, and on the succeeding days, he was confined at the Davao Doctor's Hospital. He immediately informed the company about his ailment. The company sent a letter dated June 12, 2003 to respondent, directing him to appear before the former’s office in Manila, on July 1, 2003 at 9:00 a.m., for an investigation, relative to the following violations which carry the penalty of suspension and/or dismissal, based on the following alleged violations: (1) absences without leave since January 24, 2003 to date, and (2) abandonment of work. In a letter dated June 26, 2003, respondent replied that his attending physician advised him to refrain from traveling, in order not to disrupt his daily schedule for therapy and medication. Finally, in a letter

incontestable in the absence of contrary evidence of similar nature from Crayons. Pula is entitled to reinstatement.

employer of the gravity or extent of the employee's illness and thus defeat the public policy in the protection of labor.

NOT PROPER TERMINATION

With regard to disease as a ground for termination, Article 284 of the Labor Code provides that an employer may terminate the services of an employee who has been found to be suffering from any disease and whose continued employment is prohibited by law or is prejudicial to his health, as well as to the health of his coemployees.

In order to validly terminate employment on this ground, Section 8, Rule I, Book VI of the Omnibus Rules Implementing the Labor Code requires that: Section8. Disease as a ground for dismissal. — Where the employee suffers from a disease and his continued employment is prohibited by law or prejudicial to his health or to the health of his coemployees, the employer shall not terminate his employment unless there is a certification by a competent public health authority that the disease is of such nature or at such a stage that it cannot be cured within a period of six (6) months even with proper medical treatment. If the disease or ailment can

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dated August 27, 2003, Ricanor informed respondent of the decision of petitioner's management to terminate his employment, effective upon date of receipt, on the ground of continued absences without filing a leave of absence.

be cured within the period, the employer shall not terminate the employee but shall ask the employee to take a leave. The employer shall reinstate such employee to his former position immediately upon the restoration of his normal health.

Inguillo & Bergante v First Phil Scales Inc

Inguillo and Bergante were employees of FPSI who were dismissed upon recommendation of the company’s union pursuant to their CBA’s Union Security Clause. They were being accused of disloyalty to the company’s union, among other things.

Their dismissal pursuant to the CBA’s Union Security Clause was valid.

Jeffrey Nacague v Sulpicio Lines

Nacague was suspected of using illegal drugs on board one of respondent's ships. Some members of the crew, including petitioner were subjected to a random urine drug test by SM Lazo. Petitioner tested positive for shabu. Nacague went to Chong Hua Hospital in Cebu City to undergo a voluntary drug test where he tested negative. He submitted this result to Sulpicio Lines but he was still terminated from service for grave misconduct and loss of trust and confidence. Baron was temporarily relieved to allow Management to audit the operations process of the company: there was an increase in the company’s payables and a decline in its investments. Employees were

Petitioner was illegally dismissed (no just cause). S.M. Lazo was not an accredited. drug testing center. Also, only a screening test was conducted, no confirmatory test.

Baron v NLRC & Magic Sales

The court laid down the doctrine that while the provisions of the LC (Arts. 282-285) did not mention as ground the enforcement of the Union Security Clause in the CBA, the dismissal from employment based on the same is recognized and accepted in this jurisdiction. To constitute valid dismissal from employment, two requisites must concur: (1) the dismissal must be for a just or authorized cause; and (2) the employee must be afforded an opportunity to be heard and to defend himself.

Petitioners were VALIDLY DISMISSED; NOT DENIED right to due process. Company was able to prove substantially that serious

Notice and hearing are essential elements of due process The employer must furnish the worker with 2 written notices before termination of employment can be legally effected

No requirement that the notices themselves be couched in the form and language of judicial or quasi-judicial decisions. What is required: employer

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Mantle Trading Services Inc

instructed to give all support, keys, documents and undergo a search before leaving the office. Audit team discovered that MSI incurred inventory shortage of 1, 030, 258, 21 and found that Baron in conspiracy with the other petitioners, orchestrated massive irregularities and grand scale fraud which could no longer be documented because of theft of company documents and deletion of company files. Other petitioners refused to surrender keys and documents to aid the audit process.

misconduct was committed by petitioners.

A notice apprising the employee of the particular acts or omissions for which his dismissal is sought A subsequent notice informing the employee of the employer’s decision to dismiss him With regard to hearing: the essence of due process lies simply in an opportunity to be heard and not that an actual hearing should always and indispensably be held

conduct a formal investigation process, with notices duly served on the employees informing them of the fact of investigation and if warranted, a separate notice of dismissal Through the formal investigatory process, the employee must be accorded the right to present his/her side which must be considered and weighed by the employer REASON: Employee must be sufficiently apprised of the nature of the charge, so as to be able to intelligently defend himself against the charges

Mantle Trading is engaged in the fishing business. It hired Madriaga as a “batilyo” or a fish hauler, and eventually as a “tagapuno” (someone who fills tubs with fish). Two formal incident reports were submitted, alleging that Madriaga received money from a fish trader in exchange of filling the latter’s tub with more fish. Madriaga filed for illegal dismissal and money claims.

Despite non-compliance with the notice requirement, the dismissal remains valid but Madriaga is to be indemnified for the company’s non-compliance with the notice requirement.

Violation of due process on the part of the employer did not nullify the dismissal, or render it illegal, or ineffectual. It only entitled the employee to indemnification in the form of nominal damages.

If the dismissal is based on a just cause under Article 282 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 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.

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Agabon v. NLRC and Riviera Home

Serrano v NLRC and Isetann

Private respondent Riviera Home Improvements, Inc. is engaged in the business of selling and installing ornamental and construction materials. It employed petitioners Virgilio Agabon and Jenny Agabon as gypsum board and cornice installers on January 2, 1992 until February 23, 1999 when they were dismissed for abandonment of work. The company claims that petitioners were not dismissed but had abandoned their work.

Serrano was a security checker for respondent Isetann whose services were terminated after his department was phased out. His termination was effected first through a verbal notice, then through

The dismissal should be upheld because it was established that the petitioners abandoned their jobs to work for another company. Private respondent, however, did not follow the notice requirements and instead argued that sending notices to the last known addresses would have been useless because they did not reside there anymore. Unfortunately for the private respondent, this is not a valid excuse because the law mandates the twin notice requirements to the employee’s last known address. Thus, it should be held liable for non-compliance with the procedural requirements of due process.

Prior to 1989, the rule was that a dismissal or termination is illegal if the employee was not given any notice. In the 1989 case of Wenphil Corp. v. National Labor Relations Commission, we reversed this long-standing rule and held that the dismissed employee, although not given any notice and hearing, was not entitled to reinstatement and backwages because the dismissal was for grave misconduct and insubordination, a just ground for termination under Article 282. The employee had a violent temper and caused trouble during office hours, defying superiors who tried to pacify him. We concluded that reinstating the employee and awarding backwages “may encourage him to do even worse and will render a mockery of the rules of discipline that employees are required to observe.”

Serrano’s dismissal was valid pursuant to an authorized cause. However, Isetann was held liable to pay him full backwages from the time he was dismissed without a written notice given 1

Where the dismissal of one employee is in fact for a just and valid cause and is so proven to be but he is not accorded his right to due process, i.e., he was not furnished the twin requirements of

The rule thus evolved: where the employer had a valid reason to dismiss an employee but did not follow the due process requirement, the dismissal may be upheld but the employer will be penalized to pay an indemnity to the employee. This became known as the Wenphil or Belated Due Process Rule. After carefully analyzing the consequences of the divergent doctrines in the law on employment termination, we believe that in cases involving dismissals for cause but without observance of the twin requirements of notice and hearing, the better rule is to abandon the Serrano doctrine and to follow Wenphil by holding that the dismissal was for just cause but imposing sanctions on the employer. Such sanctions, however, must be stiffer than that imposed in Wenphil. By doing so, this Court would be able to achieve a fair result by dispensing justice not just to employees, but to employers as well.

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a memo reiterating the same. Serrano filed a complaint for illegal dismissal.

month prior to the termination of his employment.

Salaw v NLRC

Petitioner and a co-employee were suspected of selling 20 sewing machines and electric generators which had been foreclosed by the respondent bank and dividing the shares between them. Petitioner was requested by private respondent to appear before the bank's Personnel Discipline and Investigation Committee (PDIC). Petitioner was requested to come to the Board Room “without counsel or representative”. Petitioner was terminated from his employment for alleged serious misconduct or willful disobedience and fraud or willful breach of the trust reposed on him by the private respondents.

Petitioner was terminated without the benefit of due process of law. His dismissal was, therefore, illegal. Complainant was denied due process when the subsequent request to refute the allegations against him was granted and a hearing was set "without counsel or representative.

King of Kings Transport v Mamac

Employee, also president of the company's labor union, was a bus conductor. He was required to submit a Conductor's Trip Report after each trip. Company found irregularities in one report conducted

Verbal appraisal of the charges against the employee is a BREACH of the procedural due process. Due process has 2 aspects: Substantive and procedural.

notice and opportunity to be heard, the dismissal shall be upheld but the employer must be sanctioned for non-compliance with the requirements of, or for failure to observe, due process. There is a violation of due process when an employee is not given a chance to defend himself, as provided in Rule XIV, Book V of the Implementing Rules and Regulations of the LC governing the dismissal of employees. Section 5 of the said Rule requires that "the employer shall afford the worker ample opportunity to be heard and to defend himself with the assistance of his representative, if he so desires." Right to counsel is a very basic requirement of substantive due process,

Sec 2 Book B Rule XXIII: 1. first notice to be served on employees should contain (1) specific causes/grounds for termination and (2) directive that employees are given the opportunity to

Cardinal primary rights (Ang Tibay): (1) Right to a hearing (2) the tribunal must consider the evidence presented (3) Decision has to be supported (4) Evidence must be "substantial." "Substantial evidence is more than a mere scintilla. It means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." (5) The decision must be rendered on the evidence presented (6) Judges must act on its or his own independent consideration of the law and facts of the controversy. (7 ) Judge must render its decision in such a manner that the parties to the proceeding can know the various issues involved, and the reasons for the decisions rendered. Non compliance with procedure results in penalty to be paid by employer

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Magro Placement v Hernandez

by respondent which resulted in a loss of P890. KKTI did not file the subsequent irregularity report but asked respondent to explain the discrepancy. Company was dissatisfied with his explanation and terminated his employment a month afterwards.

Substantive refers to the ground for termination. Court found that petitioner was terminated for just cause but verbal appraisal does not satisfy the due process requirement.

Magro is a duly licensed recruitment agency. It is the local agency of Orbit Recruitment Office of Jeddah, Kingdom of Saudi Arabia (KSA). Hernandez was an Aircon Electrical Technician of Toyota Pasong Tamo, Inc. who applied with Magro for employment abroad as Auto Electrician or Air-Conditioning Technician. Hernandez passed the interviews and trade tests and was hired as Auto Electrician of Al Yamama Est. in Jeddah, KSA on a two-year contract. Hence, he resigned from his work in Toyota. He left for Jeddah and commenced work. Due to the lack of equipment or tools, the work became harder. After 10 days, his employer in Al Yamama took his passport and brought him to Orbit. His employer told the agency that respondent did not know his job as electrician. Hernandez said he needed time to get used to the American cars he was tasked to repair as he was

Procedural due process was violated. Al Yamama failed to satisfy the two-notice requirement. Magro is ordered to pay Hernandez nominal damages.

submit their written explanation within reasonable period i.e. a period they are able to INTELLIGENTLY prepare explanation and defenses (with or without counsel) 2. employers should conduct a HEARING or CONFERENCE where employees will be given opportunity to explain, present and rebut evidence. 3. a written notice of termination should be served if all circumstances involving the charge were considered and found to have established justifiable grounds for severance Non-compliance with procedural due process gives rise to indemnification in the form of nominal damages.

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Erector Advertising Sign Gr Inc v Cloma

accustomed to working on Japanese cars. He was subjected to a trade test. He failed. He was repatriated to the Philippines. When he sought financial assistance from Magro, the latter offered the sum of P2,000.00 only. He filed for illegal dismissal. Expedito Cloma was hired as company driver and the latter had served as such until his dismissal from service in May 2000. It is conceded by petitioner that Cloma has been suspended several times from work due to frequent tardiness, absenteeism and of misbehavior.

The notice of termination served by petitioner on Cloma cites three reasons why the management has arrived at the decision to dismiss him from service: first, his absence from work for two (2) days without prior notice and approval; second, his act of barging into the premises of the Outright Division and threatening the members of the said division with bodily harm if they did not stop doing their work; and third, his frequent tardiness in reporting for work.

Nowhere in the records does it appear that Cloma attempted to deny these allegations, yet it is equally certain that the records do not contain any suggestion that petitioner, with respect to these three grounds with which Cloma is charged, has tried to notify the latter of the said charges. Indeed, we find that petitioner has not complied with the basic requirement of serving a predismissal notice on Cloma. What is clear from the records is that the only notice that was given to Cloma prior to his termination is the May 20, 2000 notice of termination informing him that his employment in the company has been severed for the causes mentioned. Moreover, we agree with the Court of Appeals that not only did petitioner fail to comply with the procedural due process requirements in terminating Cloma’s employment, but also that petitioner has not overcome the quantum of substantial evidence needed to establish the existence of just causes for dismissal in this case.

With respect to due process requirement, the employer is bound to furnish the employee concerned with two (2) written notices before termination of employment can be legally effected. One is the notice apprising the employee of the particular acts or omissions for which his dismissal is sought and this may loosely be considered as the proper charge. The other is the notice informing the employee of the management’s decision to sever his employment. This decision, however, must come only after the employee is given a reasonable period from receipt of the first notice within which to answer the charge, thereby giving him ample opportunity to be heard and defend himself with the assistance of his representative should he so desire. The requirement of notice, it has been stressed, is not a mere technicality but a requirement of due process to which every employee is entitled.

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Perez v. Phil Telegraph and Telephone Co

Technol Eight Phil Corp v NLRC & Amular

Perez and Doria were employees of PT&T who were dismissed due to their involvement in a falsification issue. Upon their complaint for illegal dismissal, they alleged, among others, that their due process rights were violated due to PT&T’s non-compliance with the hearing requirement as provided for in the Implementing Rules of the LC.

While the court upheld the illegality of their dismissal, it also said that their due process rights were not necessarily violated due to the lack of a hearing or conference. According to the court, since Art. 277(b) of the LC provides that, in cases of termination for a just cause, an employee must be given “ample opportunity to be heard and to defend himself,” thus, the opportunity to be heard afforded by law to the employee is qualified by the word “ample” which ordinarily means “considerably more than adequate or sufficient.” The phrase “ample opportunity to be heard” can be reasonably interpreted as extensive enough to cover actual hearing or conference and to this extent, Section 2(d), Rule I of the IRR of Book VI of the LC is in conformity with Article 277(b). In short, a formal hearing or conference is not required in the dismissal of an employee as there are other means for an employee to be heard.

The court laid down in this case the following guiding principles in connection with the hearing requirement in dismissal cases:

There was a confrontation between Amular & a co-worker regarding a work-related issue. The fight happened outside company premises. Amular was informed that the Technol management will conduct an administrative hearing. He was also given 2 days to respond in writing to the statements attached to and supporting the notice. A day before the hearing, Amular filed a complaint for illegal suspension/constructive dismissal.

Due process was afforded to the respondent. Petitioner chose not to present his side at the administrative hearing. In fact, he avoided the investigation into the charges against him by filing his illegal dismissal complaint ahead of the scheduled investigation. Under these facts, he was given the opportunity to be heard and he cannot now protest

The Courthas repeatedly made in employee dismissal cases, the essence of due process issimply an opportunity to be heard; it is the denial of this opportunity thatconstitutes violation of due process of law.

(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.

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Seastar Marine Services Inc v Bul-an

ABD Overseas v. NLRC

He failed to attend the administrative hearing. He was dismissed.

that he was denied this opportunity.

Captain of the ship reports that respondent was uncooperative, refused to obey his orders and often pretended to be ill. Respondent argues he was physically assaulted on the ship. LA decided in favor of respondent. NLRC affirmed. Petitioner argues that NLRC acted in excess of jurisdiction when it upheld the LA’s ruling as it was incumbent upon the NLRC to remand the case to the LA considering that the material and factual issues involving the circumstances of the respondent’s separation from employment could only be properly addressed and resolved in such proceedings Macaraya applied for employment as a dressmaker with Mars International Manpower, Inc. She paid the necessary recruitment fee and signed a two year-contract. Unknown to her, Mars submitted to POEA an overseas contract stating that Macaraya would be employed as a domestic helper. She was deployed to Riyadh, Saudi Arabia and was made to work as a domestic helper despite her objections. After 3 months and 13 days, she was dismissed by her employer, paid a measly sum, and repatriated to the Philippines. She filed for illegal dismissal and money claims before the POEA. Mars impleaded ABD as the latter became the accredited recruitment agency of M.S. Al Babtain Recruitment Office by virtue of a transfer of accreditation. The POEA rendered its decision finding that Macaraya has been

Hearing is not essential to all instances of due process.

A formal trial type hearing is not at all time and in all instances essential to due process. It is enough that the parties are given a fair and reasonable opportunity to explain their respective sides of the controversy and to present supporting evidence on which a fair decision can be based. Rule V or Rules of Procedure of NLRC (Sec 3-5)

The NLRC, in its decision, violated due process. It is clear that NLRC merely echoed the findings of the POEA and contributed two pages, including its conclusions. NLRC left petitioner “in the dark” by its failure to discuss why the facts it pointed out in its memorandum on appeal would not affect the unqualified application of Section 6, Rule I, Book III of the POEA Rules.

Every decision must be accompanied by an explanation of the factual and legal reasons that led to the conclusions of the court.

Position papers in this case were enough to comply with requirement of reasonable and fair opportunity awarded to employee

Nevertheless, the decision of the NLRC is affirmed with modifications.

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illegally dismissed and ordering ABD and Al Babtain to pay Macaraya her salaries and salary differentials. The case was elevated to the NLRC. The NLRC rendered its decision, quoting the findings of the POEA Administrator and rendering its conclusion based therefrom. ABD now contests the decision of the NLRC for the failure of the NLRC to make “categorical rulings on the issues” it had raised in its memorandum on appeal and, therefore, the NLRC should be charged with “evasion of positive duty or a virtual refusal to perform the duty enjoined” by law. Macasero v Southern Industrial Gases Phil

Petitioner filed before the National Labor Relations Commission (NLRC) Regional Arbitration Branch No. VII a Complaint against respondent company for illegal dismissal with prayer for reinstatement, backwages, unpaid benefits, and attorney’s fees, alleging that in September 1998, he was advised that his services were no longer needed and was in fact prevented from entering the company premises

In illegal dismissal cases, the onus of proving that the employee was not dismissed or, if dismissed, that the dismissal was not illegal, rests on the employer, failure to discharge which would mean that the dismissal is not justified and, therefore, illegal.

Phil Rural Reconstruction Movement v. Pulgar

Pulgar was the branch manager of PRRM’s Tayabas Office when he got involved in financial anomalies involving the company’s funds. There was a contention as to whether PRRM had the burden of proving that Pulgar’s dismissal was valid.

PRRM did not have the burden of proving WON Pulgar’s dismissal was valid because Pulgar had to prove first that he was indeed dismissed.

The appellate court ratiocinated that before respondent company could be burdened with proving the legality of dismissal, “there has to be details of acts attributed to [respondents] constituting illegal dismissal if only to give [petitioner] the opportunity to adduce evidence to defend himself from or disprove occurrence of such act or inaction,” but that petitioner failed to do so. Respondents must not, however, only rely on the seeming weakness of petitioner’s evidence, but must stand on the merits of their own defense. Before the employer must bear the burden of proving that the dismissal was legal, the employee must first establish by substantial evidence the fact of his dismissal from service because if there is no dismissal, then there can be no question as to its legality or illegality.

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Kulas Ideas & Creations et al v Alcoseba & Arao-Arao

KULAS directed Juliet and Flordelinda to explain and/or investigate an alleged inventory discrepancy. It thereafter suspended for gross negligence of duties and responsibilities.They were eventually dismissed, so they filed a complaint for illegal dismissal.

There was no substantial evidence of misappropriation of company funds to justify dismissal of respondents.

Art 282 (b) and (c) of the LC provide that an employer may terminate an employee for "gross and habitual neglect by the employee of his duties" and for "fraud." In both instances, substantial evidence is necessary for an employer to effectuate any dismissal. Article 282 (b) imposes a stringent condition before an employer may terminate an employment due to gross and habitual neglect by the employee of his duties. To sustain a termination of employment based on this provision of law, the negligence must not only be gross but also habitual.

Abosta Shipmanagement Corp v NLRC & Flores

Respondent was blamed for instigating the mass resignation of the Filipino crew. When he tried to explain that he was merely asked to oversee the resignation of other crew members, the agency said the action it’d taken in accepting his (mistaken) resignation was final. Letters of the Captain and Chief Officers were also presented as evidence to prove his instigation and to show that petitioner was unruly, arrogant, impolite and violent at times. Minex is engaged in the retail of semi-precious stones, selling them in kiosks or stalls in various shopping centers. Concepcion was employed by Minex as a saleslady, and then a supervisor, and then assigned to the kiosk in SM Harrison Plaza, tasked to hold the keys. At the close of one business day, she and two salesladies under her supervision conducted a cash-count of the proceeds from the

SUBSTANTIAL EVIDENCE SUPPORTED FLORES’ DISMISSAL IN THIS CASE

Substantial evidence is more than mere scintilla. It means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion, even if other minds, equally reasonable, might conceivably opine otherwise.

Concepcion was validly dismissed despite dismissal of criminal case.

The result of the criminal has no bearing on the validity of the dismissal. The quantum of proof required for convicting an accused is thus higher – proof of guilt beyond reasonable doubt – than the quantum prescribed for dismissing an employee – substantial evidence. The loss of employment occasions a consequence lesser

Lolita Conception v. Minex Import/Minera Cort

In rejecting the letters presented, the NLRC misappreciated the contents of the letter as they did not contain “a mere accusation of wrongdoing”. The letters made direct affirmative statements on Flores’ transgressions, all of which only elicited angry denials from him. Flores failed to refute such charges

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University of the East v UE Employees Association

sales of crystals for that particular day. Three business days raked in a total of P50,912.00. Concepcion wrapped the money in a plastic bag and placed it in a drawer of a locked wooden cabinet. The following morning, Concepcion called the Assistant Manager, reporting the loss of the proceeds kept in the drawer. The assistant manager came with a policeman who arrested Concepcion, and had her investigated and detained for one day. Eventually, she was released upon the instructions of the inquest prosecutor. She filed for illegal dismissal before the DOLE. Minex filed for qualified theft before the OCP. The Assistant Prosecutor rendered a resolution finding probable cause for qualified theft and recommending the filing of an information. She was thus charged accordingly. It appears from the records that prior to school year (SY) 1983-1984, the 70% incremental proceeds from tuition fee increases as mandated by Presidential Decree No. 451 (P.D. No. 451), as amended, was distributed by UE in proportion to the average number of academic and nonacademic personnel. The distribution scheme became the subject of an Agreement dated October 18, 1983 signed by the management, faculty association and respondent. Starting SY 1994-1995, however, the 70% incremental proceeds from the tuition fee increase was distributed by UE to its covered employees based on a new formula of percentage of salary.

than the loss of personal liberty, and may thus call for a lower degree of proof.

The Court agrees with petitioner UE that the change in the distribution of the 70% incremental proceeds from tuition fee increase from equal sharing to percentage of salaries is not a diminution of benefits. Its distribution to covered employees based on equal sharing scheme cannot be considered to have ripened into a company practice that the respondents have a right to demand. The Court agrees with UE and holds that UEEA's right to question the distribution of the incremental proceeds for SY 1994-1995 has already prescribed. Article 291 of

Generally, employees have a vested right over existing benefits voluntarily granted to them by their employer, thus, said benefits cannot be reduced, diminished, discontinued or eliminated by the latter. This principle against diminution of benefits, however, is applicable only if the grant or benefit is founded on an express policy or has ripened into a practice over a long period of time which is consistent and deliberate. It does not contemplate the continuous grant of unauthorized or irregular compensation but it presupposes that a company practice, policy and tradition favourable to the employees has

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the Labor Code provides that money claims arising from an employer-employee relationship must be filed within three (3) years from the time the cause of action accrued. In the present case, the cause of action accrued when the distribution of the incremental proceeds based on percentage of salary of the covered employees was discussed in the tripartite meeting held on June 19,1995. UEEA did not question the manner of its distribution and only on April 27, 1999 did it file an action based therein. Hence, prescription had set in.

been clearly established; and that the payments made by the company pursuant to it have ripened into benefits enjoyed by them. The test or rationale of this rule on long practice requires an indubitable showing that the employer agreed to continue giving the benefits knowing fully well that said employees are not covered by the law requiring payment thereof. In sum, the benefit must be characterized by regularity, voluntary and deliberate intent of the employer to grant the benefits over a significant period of time.

While the law looks with disfavor upon releases and quitclaims by employees who are inveigled or pressured into signing them by unscrupulous employers seeking to evade their legal responsibilities, a legitimate waiver representing a voluntary settlement of a laborer's claims should be respected by the courts as the law between the parties. While the law looks with disfavor upon releases and quitclaims by employees who are pressured into signing them by unscrupulous employers seeking to evade their legal responsibilities, a legitimate waiver representing a voluntary settlement of a laborer's claims should be respected by the courts as the law between the parties.

Talam v NLRC

Talam was a computer programmer for The Software Factory Inc. He was dismissed pursuant to a retrenchment program undertaken by said company. Following his dismissal, he signed a release and quitclaim.

Talam’s signing of a release and quitclaim should have been a bar to his filing of a complaint against his former employer since he was not an unlettered employee who did not know what he was signing.

Hypte R Aujero v Phil Communications Satellite Corp

Petitioner applied for early retirement, which was approved. He executed a Deed of Release and Quitclaim in Philcomsat’s favor. 3 years later, petitioner filed a complaint for unpaid retirement benefits, claiming that the discrepancy between the actual amount of his retirement pay vis a vis his supposed settlement for all his claims is unconscionable, which is more than enough reason to declare his quitclaim as null and void.

Absent any evidence that any of the vices of consent is present and considering the petitioner’s position and education, the quitclaim executed by the petitioner constitutes a valid and binding agreement.

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Jobel Enterprises v NLRC & Martinez

Lacrote v Incion

Quiambao v NLRC

Petitioners were required to post cash or surety bond before appeal could be heard before the NLRC. They complied by posting a surety bond but Martinez questioned its effectivity. Jobel presented a joint declaration by the company’s authorized representative and the EVP of the surety company and other documents as well. NLRC dismissed. CA dismissed appeal because petitioners submitted a PHOTOCOPY of the assailed NLRC decision

Merits of the case should be heard despite the failure to comply with technicalities. Remanded.

Lacorte was hired by Asean Fabricators, Inc. as a warehouseman. He offered to buy some obsolete, defective, and non-usable junk from the company. When he was about to bring out the purchased items, it was discovered that he was carrying more than what he bought and that the items were not junk. Some were even brand new and usable. A case for qualified theft has been filed, but was dismissed on account of insufficiency of evidence. Asean filed an application for clearance to terminate the services of Lacorte. This was granted through the issuance of an Order. Lacorte now questions the validity of the Order, attributing grave abuse of discretion on the part of the issuing Deputy Minister of Labor (Inciong). Quiambao was hired as the company's manager in the Tuguegarao branch. In April 1984, a financial and performance audit made by the Central Office showed the Tuguegarao Branch of which he was the Manager to be in “a state of

Lacorte's petition to invalidate the Order should not be granted. He only submitted affidavits to prove his claim after more than a year from the initial hearing, when the case was already on appeal. All that petitioner presented were his and a fellow employee's selfserving affidavits purportedly showing that his union activities prompted his termination. This quantum of evidence does not satisfy the substantiality requirement.

NLRC forgot that it gave company an additional unextendible 10 days to file an additional cash/surety bond in remaining balance. Company complied with the 10 day period. IT also issued the joint declaration and other documents authorizing the effectivity of the bond.

Petitioner is right that the filing of a supersedeas bond is indispensable to the perfection of an appeal in cases which, like the present one, involve monetary awards and that because Central Cement failed to comply with this

CA should have at least considered the merits as the SC did in Gutierrez v Sec of DOLE where SC held that while what were submitted were mere photocopies, there was substantial compliance with the rules since petitioner attached CTC of questioned orders to her Supplemental Motion for Reconsideration. CA’s overly rigid application of the rules of procedure SACRIFICED SUBSTANCE TO FORM in a situation where the petitioner’s recourse was not patently frivolous or meritless Absence or lack of substantial evidence to prove a claim warrants the dismissal of the case.

It is true that, in some cases, this Court relaxed the requirement of posting supersedeas bond for the perfection of an appeal. But the decisions in those cases were justified by the fact that there was substantial compliance with the

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Cruz v Coca-Cola Bottlers Phils

Miguel Barairo v OP & MST Marine

disarray and chaos.” On May 25, 1984, petitioner was suspended for an indefinite period for poor performance in extending credit to customers, violation of company rules and regulations and gross negligence. As a result of further investigation petitioner was charged with estafa before the Provincial Fiscal of Tuguegarao, while a civil case for collection was brought against him in the Regional Trial Court of Makati. , the case was eventually dismissed by the Regional Trial Court of Tuguegarao because of the failure of the prosecution witnesses to appear. The civil suit filed by Central Cement was likewise dismissed by Branch 60 of the Regional Trial Court of Makati for failure of Central Cement to prove its case against petitioner Quiambao.

requirement, the decision of the Labor Arbiter, finding Central Cement guilty of the illegal dismissal of petitioner, became final and executory. Art. 223 expressly provides that “In case of a judgment involving a monetary award, an appeal by the employer may be perfected only upon the posting of a cash or surety bond issued by a reputable bonding company duly accredited by the commission in the amount equivalent to the monetary award in the judgment appealed from.”

rule, so that on balance, technical considerations had to give way to considerations of equity and justice. In the case at bar, no similar justifications exist excusing Central Cement’s failure to comply with the rule on mandatory posting of supersedeas bond.

Cruz was a driver for respondent company who was caught loading 30 additional cases of canned softdrinks on his truck without securing the necessary permits. He was dismissed on that basis. He filed an illegal dismissal complaint against CocaCola based on his alleged good faith in committing said violation. POEA penalized petitioner with one year suspension from overseas deployment upon a finding that his refusal to complete his contract aboard the M/T Haruna constituted a breach of contract. Sec of Labor shortened his suspension from 1 year to 6 months as it was his first offense. The Office of the President dismissed

His dismissal was valid. According to the court, several factors militate against petitioner’s claim of good faith, primary of which is Cruz’s length of service, which spans almost 15 years.

The longer an employee stays in the service of the company, the greater is his responsibility for knowledge and compliance with the norms of conduct and the code of discipline in the company.

The proper remedy to question orders of Sec. of Labor is a Petition for Certiorari under Rule 65, not via an appeal to the OP.

Appeals to the OP in labor cases have indeed been eliminated, except those involving national interest over which the President may assume jurisdiction.

The consequence of private respondents’ failure to comply with the mandatory requirement for the perfection of the appeal was to render the decision of the Labor Arbiter final and executory, and to place it beyond the power of the NLRC to review and, even more so, to reverse.

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Mindanao Times Corp v Confesor

University Plans Inc v Solano

the petitioner’s appeal for lack of jurisdiction. The OP held that appeals to it in labor cases, except those involving national interest, have been eliminated.

period, hence, the assailed Decisions of the Secretary of Labor are deemed to have attained finality.

Mitchel Confesor (respondent) was employed on May 1998 by petitioner, publisher of a newspaper of general circulation in Mindanao and Davao City. He became petitioner’s Associate Editor in six months. Respondent resigned from petitioner on June 17, 2003. He filed a verified complaint before the Labor Arbiter for payment of separation pay and pro-rated 13th month pay for 2003. By Decision of January 19, 2004, the Labor Arbiter, finding that respondent was constructively dismissed, ordered petitioner to pay him P71,909.77 representing backwages, as well as separation pay and 10% of the total award as attorney’s fees. In compliance with the appeal bond requirement, petitioner deposited the amount of P71,909.77 with the United Coconut Planters Bank and surrendered to the NLRC the passbook covering the deposit, along with a Deed of Assignment it executed assigning the proceeds of the deposit in favor of respondent and authorizing the NLRC to release the same in the event that the Labor Arbiter’s Decision becomes final and executory. Respondents in this case filed a complaint for illegal dismissal against University Plans. LA found the latter

Article 223 of the Labor Code provides that an appeal by the employer to the NLRC from a judgment of a labor arbiter which involves a monetary award may be perfected only upon the posting of a cash or surety bond issued by a reputable bonding company duly accredited by the NLRC, in an amount equivalent to the monetary award in the judgment appealed from.

Further, Sec. 6 of the same Rules provides: SECTION 6. BOND. In case the decision of the Labor Arbiter or the Regional Director involves a monetary award, an appeal by the employer may be perfected only upon the posting of a cash or surety bond. The appeal bond shall either be in cash or surety in an amount equivalent to the monetary award, exclusive of damages and attorney’s fees.

The NLRC may reduce University Plans’ bond.

The exercise of the authority to reduce the bond is not a matter of right on the part of the movant,

Clearly, an appeal from a judgment as that involved in the present case is perfected “only” upon the posting of a cash or surety bond.

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guilty. Upon appeal, the company also filed a motion to reduce bond which was denied by the NLRC pursuant to Art. 223 of the LC and in accordance with its finding that the company cannot post such bond as required from it.

Lopez v NLRC

Complainant (a psychometrician) was alleged to have uttered indecent and obscene remarks against respondent Fr. Lao. As a result, the complainant was suspended. She was subsequently investigated and dismissed on grounds of serious misconduct, commission of a crime (grave oral defamation), insubordination, unfaithfulness to employer’s interest, quarrel¬ling and challenging to a fight and loss of confidence. The complainant amended her complaint to illegal dismissal. NLRC: there was illegal dismiss¬al due to absence of just cause and due process but ordered private respondent to grant separation pay in lieu of reinstatement. Petitioner elevated the case by petition for certiorari, seeking reinstatement to her former

but lies within the sound discretion of the NLRC upon a showing of meritorious grounds. Meritorious grounds include: (1)There was substantial compliance with the Rules; (2) The surrounding facts and circumstances constitute meritorious grounds to reduce the bond; (3) A liberal interpretation of the requirement of an appeal bond would serve the desired objective of resolving controversies on the merits; or (4) The appellants, at the very least, exhibited their willingness and/or good faith by posting a partial bond during the reglementary period. The respondent school failed to establish clear and valid cause of termination thus the dismissal is considered illegal HOWEVER petitioner should not be reinstated. Since reinstatement would not be to the best interest of the parties, in lieu thereof, separation pay suffices.

Generally, the remedy for illegal dis¬missal is the reinstatement of the employee to her former position without loss of seniority rights and the payment of backwages. However, there are instances as when reinstatement is not a viable remedy as where the relation between the employer and the employee had been severely strained that is not advisable to grant reinstatement.

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Asian Terminals Inc v Villanueva

Composite Enterprises v Caparoso

Johnson and Johnson v Johnson

position. Case for illegal dismissal. LA ordered reinstatement of respondents to their former or equivalent positions and the payment of backwages to respondents from the time of their illegal dismissal up to the time of their reinstatement. NLRC affirm which became final and executory. Present controversy arose when respondents filed motions and sought additional backwages alleging that MPSI did not reinstate them to their former/equivalent positions.

Caparoso and Quindipan were employed as Composite's deliverymen until they were terminated. The two filed for illegal dismissal. The Labor Arbiter rendered a decision in favor of the respondents, ordering their reinstatement. Composite prayed that separation pay be granted instead as reinstatement was no longer possible due to the extinguishment of the previous positions occupied by respondents on account of the retrenchment program undertaken by Composite. The Labor Arbiter issued a Writ of Execution directing the Sheriff to effect respondents' reinstatement. Consistent with its stand that physical reinstatement was no longer possible, Composite reinstated respondents into its payroll, conditioned on the NLRC's ruling on its motion to be allowed to pay separation pay in lieu of reinstatement. In a complaint for illegal dismissal,

YES they reinstated employees. Petitioners were able to present evidence (memoranda and roster) evincing reinstatement to exact positions. Reinstatement means restoration to the former position occupied prior to dismissal or to substantially equivalent positions. It does not mean promotion. Just because their contemporaries are already occupying higher positions does not automatically entitle respondents to similar positions. Composite only submitted as evidence the notice of its intention to implement a retrenchment program, which it sent to the Department of Labor and Employment. It did not submit its financial statements duly audited by an independent external auditor. Its failure to do so seriously casts doubt on its claim of losses and insistence on the payment of separation pay. Respondents should thus be reinstated.

ILLEGALLY DISMISSED EMPLOYEE

Reinstatement presupposed that the previous position from which one had been removed still exists, or that there is an unfilled position which is substantially equivalent or of similar nature as the one previously occupied by the employee. It means restoration to a state/condition from which one had been removed or separated.

Payment of separation pay as a substitute for reinstatement is allowed only under exceptional circumstances, viz: (1) when reasons exist which are not attributable to the fault or are beyond the control of the employer, such as when the employer -- who is in severe financial strait, has suffered serious business losses, and has ceased operations -- implements retrenchment, or abolishes the position due to the installation of labor-saving devices; (2) when the illegally dismissed employee has contracted a disease and his reinstatement will endanger the safety of his co-employees; or, (3) where a strained relationship exists between the employer and the dismissed employee.

Reinstatement is the restoration to a state or condition from which one has been removed or separated. The intent of the law in making a reinstatement order immediately executory is much like a return-to-work order, i.e., to restore the status quo in the workplace in the meantime that the issues raised and the proofs presented by the contending parties have not yet been finally resolved.

GENERAL RULE: it is a well-

Petitioners are mistaken in

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Office and Sales Union

Retuya v Hon Dumarpa

NLRC ruled that respondents were entitled to reinstatement. Petitioners filed motion to set case for conference manifesting their willingness to pay respondents separation pay and other monetary benefits. Respondents refused and sought for immediate reinstatement to former positions. NLRC directed reinstatement. CA affirmed NLRC

Insular Builders, Inc. is a familyowned corporation managed and operated principally by Antonio Murillo, father, and his son, Rodolfo Murillo. Petitioners are workers who have rendered services in various corporations of Antonio and Rodolfo. At the height of the feud between Antonio and Rodolfo, the former discharged the latter from his

entrenched rule that an illegally dismissed employee is entitled to reinstatement as a matter of right EXCEPTION: But when reinstatement is not feasible, expedient or practical as where reinstatement would only exacerbate the tension and strained relations between the parties or where the relationship between the employer and employee has been unduly strained by reason of their irreconcilable differences, particularly where the illegally dismissed employee held a managerial/key position in the company, it would be more prudent to order payment of separation pay instead of reinstatement

Reinstatement is no longer possible; hence, the payment of separation pay and backwages should be made instead. Reinstatement is no longer feasible as Insular Builders, Inc. has already ceased operations. Instead of reinstatement, the Labor Code provides for an alternative relief to reinstatement which may be

holding that they have the prerogative to choose whether to reinstate respondents to their former positions or just to pay their monetary award Neither party can claim that it has the categorical right to choose between reinstatement and payment of monetary award NLRC ultimately has the authority to execute its judgment and settle any issue that may arise pertaining to the manner of details of implementing its judgment

IN OTHER WORDS: The payment of separation compensation in lieu of the reinstatement of an employee who was illegally dismissed from work shall be allowed only if the employer can prove the existence of circumstances showing that reinstatement will no longer be for the mutual benefit of the employer and employee. Employees terminated due to business closure are entitled to either: (1) reinstatement + backwages; or (2) separation pay, should reinstatement be no longer possible, + backwages

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Divine Word High School v NLRC

Espejo v NLRC

position as manager of Insular Builders, Inc. Petitioners were told to temporarily stop working. Antonio dismissed petitioners and reported the matter to the Department of Labor and Employment (DOLE). Petitioners were however made to continue their work, rendering the same services, in the same place, locality and at the same office but under a different company, the Queen City Builders, Inc., managed and controlled by Rodolfo. Petitioners filed a complaint for illegal dismissal, non-payment of wages, 13th month pay, and retirement pay (for Dayson). Respondent Catena was a high school teacher for Divine Word who filed a complaint for illegal dismissal after having been terminated from service because of his husband’s (principal of said school) immoral conduct. There was a contention as to WON she should be reinstated. Espejo resigned when the Board of Directors decided to sell his car in order to meet the capital requirements of the Insurance Commission. During a subsequent meeting, petitioner asked for a reconsideration of the decision or else his resignation would be irrevocable. He later received a letter accepting his resignation. LA ordered his reinstatement, backwages and attorneys' fees. NLRC deleted award for reinstatement as petitioner was already 60 years old.

granted to an illegally dismissed employee: separation pay. The amount of backwages shall be computed from the time of their illegal termination up to the time of the cessation of the business operations.

While the court upheld the illegality of her dismissal, it still concluded that her reinstatement as teacher would not be proper.

The court may opt to award separation pay in lieu of reinstatement if the latter would create antagonism between the employer and the employee.

Petitioner not entitled to reinstatement. An employee held to be illegally dismissed cannot be reinstated if he already reached the age of 60 years at the time of his second complaint in the LA's office. Generally, an illegally dismissed employee who cannot be reinstated is granted separation pay and backwages. However considering that petitioner hasalready reached the statutory retirement age of 60, petitioner is entitled only to backwages.

The payment of backwages is a form of relief that restores the income lost by reason of the unlawful dismissal; separation pay, in contrast, is oriented towards the immediate future, the transitional period the dismissed employee must undergo before locating a replacement job.

The law recognizes as valid any retirement plan, agreement or management policy regarding retirement at an earlier or older age but if the company does not have any retirement plan for its employees, Sec. 13, Book IV, OR of the LC will apply. It provides that in the absence of a retirement plan, agreement or policy an employee may be retired upon reaching the age of 60 years which means that an employee may retire, or may be retired by his employer, upon reaching

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Wensha Spa Center Inc v Loreta Yung

Respondent claims she was dismissed because petitioner's Feng Shui master stated her Chinese Zodiac was a mismatch to the company's office. Petitioner claims she was dismissed for loss of trust and confidence as respondent allegedly spread gossip and rumors around the office. Respondent thought she was on a one-month paid leave but petitioner had not informed her they decided to terminate her services. When respondent reported for work, invectives were exchanged and she was only informed of their intention to terminate her then.

Reinstatement was no longer feasible as a remedy due to the doctrine of strained relations.

DUP Sound Phils v CA, Cirilo A Pial

Pial was an employee of DUP (engaged in the business of recording cassette tapes for various recording companies for 7 months. He was reemployed by DUP and was given the job of “mastering tape”. He absented from work due to sickness. When he got well the following day and was ready for work, an instruction from Tan prohibited him from reporting back to work. After three weeks, he was told that he was no longer allowed to work. He filed for illegal dismissal. The Labor Arbiter ruled in his favor and instructed DUP to reinstate him, along with the grant of other reliefs. DUP reinstated him not as mastering tape, but as bodegero. He refused to report to work. Ranara was working as a driver for the respondent company. One day, he was told that he is dismissed from work and cannot come back anymore. When he returned the next day, he was not allowed entry to the

Pial's assignment to a different job, as well as transfer of work assignment without any justification therefor, cannot be deemed as faithful compliance with the reinstatement order. The resulting circumstances show that reinstatement would be impractical and would hardly promote the best interest of the parties. Hence, separation pay instead.

Ranara v NLRC

It is clear that the petitioner was illegally dismissed without even the politeness of a proper notice. Without cause and without any investigation, formal or otherwise, Ranara was simply told that he

Under the law and jurisprudence, an illegally dismissed employee is entitled to two reliefs: backwages and reinstatement, which are separate and distinct. If reinstatement would only exacerbate the tension and further ruin the relations of the employer/employee or if their relationship has been duly strained due to irreconcilable differences, particularly where the illegally dismissed employee held a managerial or key position in the company it would be prudent to order payment of separation pay instead of reinstatement Reinstatement means restoration to a state or condition from which one had been removed or separated. The person reinstated assumes the position he had occupied prior to his dismissal.

The fact that his employer later made an offer to re-employ him did not cure the vice of his earlier arbitrary dismissal. The wrong had been committed and the harm done.

60. SC ruled on facts as it was an exceptional circumstance (NLRC and CA's factual findings greatly differed) and favored respondent as it was more consistent and clearly based on established fact. Moreover, company failed to comply with twinnotice requirement. Private respondents, heads of the company, not considered solidarily liable since no finding of bad faith, only negligence and bad judgment. Reinstatement presupposes that the previous position from which one had been removed still exists, or that there is an unfilled position which is substantially equivalent or of similar nature as the one previously occupied by the employee."

The wrong had been committed and the harm done. Notably, it was only after the complaint had been filed that it occurred to Chang, in a

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Juanito Garcia v PAL

company. Ranara filed a complaint to the Labor Arbiter. Respondents claim that Ranara abandoned his work.

should not report back for work the following day. When he did so just the same, thinking she had only spoken in jest, he found that somebody else had been employed in his place. When he protested his replacement, he was even scolded for being "hardheaded" and not accepting his dismissal.

Garcia and Dumago were employees of PAL who were dismissed for allegedly sniffing shabu within the company’s premises. While the LA found in favor of Garcia and Dumago and ordered their reinstatement, the NLRC subsequently reversed said decision. Prior to the employees’ filing of a complaint, PAL was placed under rehabilitation proceedings by SEC.

While the court upheld the Air Phils. Corp v. Zamora doctrine and discarded the Genuino v. NLRC doctrine in this case, it still held that Garcia and Dumago may not collect their wages during the period between the LA’s order of reinstatement pending appeal and the NLRC decision overturning the LA’s decision since PAL was under rehabilitation proceedings.

Notably, it was only after the complaint had been filed that it occurred to Chang, in a belated gesture of good will, to invite Ranara back to work in his store. Chang's sincerity is suspect. We doubt if his offer would have been made if Ranara had not complained against him. At any rate, sincere or not, the offer of reinstatement could not correct the earlier illegal dismissal of the petitioner. The private respondents incurred liability under the Labor Code from the moment Ranara was illegally dismissed, and the liability did not abate as a result of Chang's repentance.The fact that his employer later made an offer to reemploy him did not cure the vice of his earlier arbitrary dismissal. 2 divergent jurisprudential views regarding reinstatement pending appeal or option of payroll reinstatement: Air Philippines Corp. v. Zamora a dismissed employee whose case was favorably decided by the LA is entitled to receive wages pending appeal upon reinstatement, which is immediately executory. Unless there is a restraining order, it is ministerial upon the LA to implement the order of reinstatement and it is mandatory on the employer to comply therewith.

belated gesture of good will, to invite Ranara back to work in his store. Chang's sincerity is suspect. We doubt if his offer would have been made if Ranara had not complained against him. At any rate, sincere or not, the offer of reinstatement could not correct the earlier illegal dismissal of the petitioner. The private respondents incurred liability under the Labor Code from the moment Ranara was illegally dismissed, and the liability did not abate as a result of Chang's repentance. Genuino v. NLRC If the decision of the LA is later reversed on appeal upon the finding that the ground for dismissal is valid, then the employer has the right to require the dismissed employee on payroll reinstatement to refund the salaries s/he received while the case was pending appeal, or it can be deducted from the accrued benefits that the dismissed employee was entitled to receive from his/her employer under existing laws, collective bargaining agreement provisions, and company practices. However, if the employee

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Myrna P Magana v Medicard Phil

College of Immaculate Concepcion v NLRC & Atty Carlos

Petitioner was held to be illegally dismissed by the LA and ordered reinstated. NLRC affirmed and also awarded reinstatement wages to petitioner for respondent's failure to reinstate her pending appeal as required under the Art 223, par. 2 of the LC. CA deleted award of reinstatement wages as it found petitioner's dismissal to be with cause, noting that respondent's failure to assign petitioner to a suitable position within 6 months after her replacement is "analogous to a suspension of operations of an enterprise" entitling the employee to payment only of separation pay. The issue is if the arbiter's order of reinstatement remains unexecuted, should its subsequent reversal on appeal preclude execution?

Respondent is not only bound to pay petitioner her reinstatement wages, it is also precluded from recovering the amount paid postreversal of the arbiter's reinstatement order by the CA.

After his term as Dean was up, respondent was appointed as fulltime professor without diminution of benefits and was warned not to teach in other schools without permission of the Department Head or practice law. Respondent argued that teaching in another school was a privilege allowed to him as dean and administrator and that the case he was handling was referred to him by the VP of the school. The school did

NO REFUND RULE: Subsequent reversal of the LA's findings does not meant that respondent should reimburse petitioner all the salaries and benefits he received pursuant to the immediate execution of the LA's decision.

Article 223, par. 2 LC a police power measure, is mandatory and immediately executory

The requirement for employers to pay wages to employees obtaining favorable rulings in illegal dismissal suits pending appeal is statutorily mandated Art 223, par. 2. It gives employers two options, namely, to (1) actually reinstate the dismissed employees or, (2)constructively reinstate them in the payroll. Either way, this must be done immediately upon the filing of their appeal, without need of any executory writ.

If the employee has been reinstated during the appeal period and such reinstatement order is reversed with finality, the employee is not required to reimburse whatever salary he received for he is entitled to such, more so if he actually rendered services during the period. An employer could not validly insist that it is entitled to reimbursement for the payment of salaries of a

was reinstated to work during the pendency of the appeal, then the employee is entitled to the compensation received for actual services rendered without need of refund. The State may authorize an immediate implementation, pending appeal, of a decision reinstating a dismissed or separated employee since that saving act is designed to stop, although temporarily since the appeal may be decided in favor of the appellant, a continuing threat or danger to the survival or even the life ofthe dismissed or separated employee and its family.

Petitioner failed to overcome the presumption of regularity of the LA's decision in asserting their position that the LA's decision was tainted with fraud and graft and corruption. It is also an improper forum for such a petition.

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not assign him any units to teach that semester. He argues that this was constructive dismissal. The LA found that he was illegally dismissed and ruled that he be reinstated. NLRC reversed.

Lansangan v Amkor Tech Phil Inc

Aurora Land v NLRC

An anonymous e-mail was sent to the General Manager of Amkor detailing allegations of malfeasance on the part of its supervisory employees Lansangan and Cendaña (petitioners) for "stealing company time." Amkor thus investigated the matter. Petitioners admitted their wrongdoing. Amkor terminated petitioners for "extremely serious offenses" as defined in its Code of Discipline. Petitioners filed a complaint for illegal dismissal. The Labor Arbiter found the dismissal to be valid, but ordered the petitioners’ reinstatement "as a measure of equitable and compassionate relief" owing mainly to petitioners’ prior unblemished employment records, show of remorse, harshness of the penalty and defective attendance monitoring system of respondent. Amkor appealed the decision, with respect to the order of reinstatement, to the NLRC. Pending the appeal, petitioners moved for the issuance of a “Writ of Reinstatement.” The LA then issued an alias writ of execution. Private respondent Honorio Dagui was hired by Doña Aurora Suntay Tanjangco in 1953 to take charge of

The case at hand has already been resolved as to the validity of petitioners’ dismissal. It has been found that they have been validly dismissed. Since Article 223 only applies when the case is yet to be resolved as to the validity of the employee's dismissal, such rule does not apply to this case.

We find private respondent to be a regular employee, as provided in Article 280 of the Labor Code.

reinstated employer pursuant to the execution of the La's decision by simply arguing that the LA's decision is incorrect. (Art 223). Moreover, the Refund Doctrine is not only contrary to the principles of social justice but poses illogical and unjust effects (could be a means for companies to circumvent the law --> posting of bonds) Article 223 concerns itself with an interim relief, granted to a dismissed or separated employee while the case for illegal dismissal is pending appeal. It does not apply where there is no finding of illegal dismissal.

As can be gleaned from this provision, there are two kinds of regular employees, namely: (1)

Petitioners' liability for separation pay ought to be reckoned from 1982 when

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St. Michael's Ins. v Santos

Mercury Drug Co Inc v CIR

the maintenance and repair of the Tanjangco apartments and residential buildings. He was to perform carpentry, plumbing, electrical and masonry work. Upon the death of Doña Aurora Tanjangco in 1982, her daughter, petitioner Teresita Tanjangco Quazon, took over the administration of all the Tanjangco properties. On June 8, 1991, private respondent Dagui received the shock of his life when Mrs. Quazon suddenly told him: "Wala ka nang trabaho mula ngayon," on the alleged ground that his work was unsatisfactory. On August 29, 1991, private respondent, who was then already sixty-two (62) years old, filed a complaint for illegal dismissal with the Labor Arbiter. Respondent allege that Dagui is merely a job contractor and not their regular employee. Respondent teachers were employed at St. Michael’s when they were dismissed after allegedly joining a public rally against the school. The CA, after sustaining NLRC’s decision saying that said teachers were indeed illegally dismissed, went further as to order the award of backwages to them. St. Michael’s was contending that such was not valid as it has been a time-honored doctrine that a party who has not appealed cannot obtain from the appellate court any affirmative relief other than the ones granted in the appealed decision. Dayao tried to create a new union as the existing union was not doing anything to recover from the management their overtime pay. Because of this, he was told to resign.

those who are engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer; and (2) those who have rendered at least one year of service, whether continuous or broken, with respect to the activity in which they are employed. Whichever standard is applied, private respondent qualifies as a regular employee.

The SC upheld the award of backwages to respondents. According to the court, the fact that the NLRC did not award backwages to the dismissed teachers or that the teachers themselves did not appeal the NLRC decision does not bar the CA from awarding backwages.

While as a general rule, a party who has not appealed is not entitled to affirmative relief other than the ones granted in the decision of the court below, the CA is imbued with sufficient authority and discretion to review matters, not otherwise assigned as errors on appeal, if it finds that their consideration is necessary in arriving at a complete and just resolution of the case or to serve the interests of justice or to avoid dispensing piecemeal justice.

The employer was directed to pay private respondent Dayao back wages equivalent to one year, eleven months, and fifteen days

The period of delay in instituting this ULP charge with claim for reinstatement and back wages, although within the prescriptive period, should be deducted from

petitioner Teresita Quazon, as manager of Aurora Plaza, continued to employ private respondent. From 1953 up to the death of Doña Aurora sometime in 1982, private respondent's claim for separation pay should have been filed in the testate or intestate proceedings of Doña Aurora. This is because the demand for separation pay covered by the years 1953-1982 is actually a money claim against the estate of Doña Aurora, which claim did not survive the death of the old woman. Thus, it must be filed against her estate in accordance with Section 5, Rule 86 of the Revised Rules of Court.

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Bustamante v. NLRC

Star Paper Corporation v Espiritu

He only resigned because he was told that he would be laid-off anyway whether or not he signed the resignation papers. He only brought the action for unfair labor practice 2 years and 15 days later. Main Issue: How should his backwages be computed?

without further disqualifications.

First Division of SC promulgated a decision reversing the NLRC decision and reinstating the LA’s decision with the modification that backwages should be paid to petitioners from the time of their illegal dismissal on June 25 1990 up to the date of their reinstatement. If reinstatement was no longer feasible, one-month salary shall be paid as ordered in the LA’s decision in addition to the adjudged backwages. Private respondent now moves to reconsider because petitioners are not entitled to recover backwages because they were not actually dismissed as they were probationary workers and assuming they were entitled to backwages, computation should not start from cessation of work up to actual reinstatement. Salary earned elsewhere should be deducted. Respondents worked in Star’s paper manufacturing business in various capacities as machine operator, bookbinding head and/or helper. They refused to sign the ratification of an addendum to an existing Collective Bargaining Agreement

Court explained different laws enacted over the years for computation. RA 875 Industrial Peace Act, PD 442 (Labor Code) RA 6715 amending Art 279 of the LC,

the liability of the employer to him for back wages. However to relieve employee from proving his income during the period he was out of the service and the employer from submitting counter-proofs, which may delay the execution of the decision, the employer in this case was directed to pay private respondent Dayao back wages equivalent to 1 year, 11 months, and 15 days without further disqualifications. LAW NOW : 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 is withheld from him up to the time of his actual reinstatement.

Backwages to be awarded to an illegally dismissed employee should not be diminished/reduced by the earnings derived by him elsewhere during the period of his illegal dismissal. The underlying reason for this is that the employee while litigating the legality of his dismissal must still earn a living to support himself and family while full backwages have to be paid by the employer as part of the price/penalty he has to pay for illegally dismissing his employee LEGISLATIVE INTENT: give more benefits to workers

Reinstatement would have been effective upon finality of the decision of the CA. However, the CA decision has been elevated to the SC. The supposed actual reinstatement, had reinstatement been feasible, would have been

Full backwages, inclusive of allowances, and other benefits or their monetary equivalent, are computed from the time the employee’s compensation was withheld from him up to the time of his supposed actual

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Acesite Corp v. NLRC

Phil Aeolus Automotive United v NLRC

which was intended to effect a reduction in their leave benefits. When they reported for work, they were not allowed entry. They received a Memorandum of Transfer which they refused. They alleged that their transfer to a provincial post constituted constructive dismissal. LABOR ARBITER: There was no illegal/constructive dismissal, but separation pay must be granted. NLRC: LA’s decision was affirmed. CA: There was constructive dismissal. Dismissed employees are entitled toseparation pay and full backwages. Gonzales was hired as chief of Security of Manila Pavillion Hotel. He took a 4-day sick leave, then a 12-day vacation leave. Afterwhich, he file a 10-day emergency leave. The emergency leave was disapproved and he was required to report for work the next day. However, Gonzales did not report for work the next day.

upon the finality of the SC’s decision. Hence, backwages should be computed from the time the respondents’ compensation was withheld from them up to the time of the finality of the SC’s decision.

reinstatement.

There appears to have been no just cause to dismiss Gonzales from employment. As correctly ruled by the Court of Appeals, Gonzales cannot be considered to have willfully disobeyed his employer.

As for Gonzales’ petition before this Court, he argues that the Court of Appeals, absent any reason, modified the decision of the NLRC by deleting or eliminating the “other fringe benefits or their monetary equivalent;” that the said court should not have given Acesite the option to reinstate him or not since the case at bar does not fall under circumstances for which reinstatement is no longer possible

Cortez was a company nurse of Phil. Aeolus who was dismissed on the grounds of gross and habitual neglect of duties, serious misconduct and fraud or willful breach of trust. She was claiming, however, that she was the victim of their plant manager’s

She was entitled to such an award. According to the court, for the anxiety, the seen and unseen hurt that Cortez suffered, Philippine should also be made to pay her moral damages, plus exemplary damages, for the oppressive

Bases for awarding moral and exemplary damages: In moral damages, it suffices to prove that the claimant has suffered anxiety, sleepless nights, besmirched reputation and social humiliation by reason of the act

Gonzales was Chief of Security, whose duty was to “manage the operation of the security areas of the hotel to provide and ensure the safety and security of the hotel guests, visitors, management, staff and their properties according to company policies and local laws.” It cannot be gainsaid that Gonzales’ position is one of trust and confidence, he being in charge of the over-all security of said hotel. Thus, reinstatement is no longer possible. In lieu thereof, Acesite is liable to pay separation pay of 1 month for every year of service.

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Reyes v CA

M+W Zander Phil v Enriquez

partiality and sexual advances. There was a contention as to such would entitle her to an award of moral and exemplary damages.

manner with which petitioners effected her dismissal from the service, and to serve as a forewarning to lecherous officers and employers who take undue advantage of their ascendancy over their employees.

complained of. Exemplary damages, on the other hand, are granted in addition to, inter alia, moral damages "by way of example or correction for the public good" if the employer "acted in a wanton, fraudulent, reckless, oppressive or malevolent manner."

Petitioner was retrenched. He acknowledged verbal notice of resignation and requested that he be given the same benefits granted to retrenched and resigned employees of the company, consisting of separation pay and the monetary equivalent of his sick leave and vacation leave and additional benefits. He was awarded by the lower courts (among other things) attorneys' fees and moral and exemplary damages.

He is not entitled to moral and exemplary damages as respondents were not shown to have acted in bad faith. He, however, is entitled to attorney’s fees equivalent to 10% of his total monetary award.

Moral damages are recoverable only where the act complained of is tainted by bad faith or fraud, or where it is oppressive to labor, and done in a manner contrary to morals, good customs, or public policy.

In the case at bar, what was withheld from petitioner was not only his salary, vacation and sick leave pay, and 13th month pay differential, but also his separation pay. Hence, pursuant to current jurisprudence, separation pay must be included in the basis for the computation of attorney’s fees.

Exemplary damages may be awarded only if the act was done in a wanton, oppressive, or malevolent manner.

Two concepts of attorney's fees: 1. Ordinary- An an attorney’s fee is the reasonable compensation paid to a lawyer by his client for the legal services he has rendered to the latter. The basis of compensation is the fact of his employment by and his agreement with the client

Illegally dismissed. Respondent

In illegal dismissal cases, moral

2. Extraordinary- Attorney’s fees are deemed indemnity for damages ordered by the court to be paid by the losing party in a litigation. Instances when it may be awarded are those enumerated in Art 2208 CC specifically par. 7 thereof which pertains to actions for recovery of wages, and is payable not to the lawyer but to the client, unless they have agreed that the award shall pertain to the lawyer as additional compensation or as part thereof. It is this type that is contemplated in Art 111 of the LC. General manager of a

Respondent was accused of staging a

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"no work day" and using her position to influence subordinates to oppose the appointment of the company's new GM. When she showed up at work, she was placed under preventive suspension, her personal belongings were searched and she was escorted from the premises like a criminal. A notice was sent to her subordinates that she was not allowed in the company without an authorized escort.

entitled to moral damages and attorney's fees.

J Marketing Corp v Taran

Taran worked as credit investigator/collector for “J” Marketing Corporation. He informed J Marketing's then OIC Branch Manager of his intention to resign. A memorandum was sent to him, requiring him to submit a formal resignation letter. He filed his resignation letter, on account of his verbal agreement with the company that 100% separation pay would be granted him. J Marketing failed to pay him as agreed upon. He filed with the NLRC a complaint for illegal dismissal.

He is entitled to separation pay for his loyalty and long service to the company, not to mention the representation of the OIC that he would be given all the benefits due him. Without the assurance of payment of benefits, Taran would not have tendered his resignation letter.

BPI v NLRC

Respondent was the manager of BPI San Pablo Laguna branch. When a client asked for the details of her account, it was found out that it was lacking in amount. After an investigation, it was found out that the respondent was making unauthorized withdrawals from the

The succeeding case of Toyota Motor Phils. Corp. Workers Association v. NLRC25 reaffirmed the general rule that separation pay shall be allowed as a measure of social justice only in those instances where the employee is validly dismissed for causes other

damages are recoverable only where the dismissal of the employee was attended by bad faith or fraud or constituted an act oppressive to labor or was done in a manner contrary to morals, good customs or public policy. Attorney's fees may be awarded only when the employee is illegally dismissed in bad faith and is compelled to litigate or incur expense to protect his rights by reason of the unjustified acts of his employer. (Manner of suspension/dismissal was "humiliating". Court ruled this was performed in bad faith.) Accordingly, separation pay may be awarded only in cases when the termination of employment is due to: installation of labor-saving devices; redundancy; retrenchment; closing or cessation of business operations; disease of an employee and his continued employment is prejudicial to himself or his co-employees; when an employee is illegally dismissed but reinstatement is no longer feasible. EXCEPTIONS: when stipulated in the employment contract or in the CBA; or when sanctioned by established employer practice or policy.

corporation should not be made personally answerable for the payment of an illegally dismissed employee's monetary claims arising from the dismissal unless he had acted maliciously or in bad faith in terminating the services of the employee. (Not proven it was accused official in this case)

Verily, it may not be amiss to emphasize that if an employee has been dismissed for a just cause under Article 282 of the Labor Code, he is not entitled to separation pay. In the instant case, respondent was dismissed on the ground of loss of trust and

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Triad Security and Allied Services v Ortega

Palteng v UCPB

account of their clients. BPI essentially questions the award of separation pay. It argues that the very existence of respondent’s signature on the forged withdrawal slips in such frequency and involving huge amounts of money, transacted beyond banking hours, and without the presence of the clients, should be sufficient to hold respondent liable for fraud, thus negating the finding of good faith.

than serious misconduct, willful disobedience, gross and habitual neglect of duty, fraud or willful breach of trust, commission of a crime against the employer or his family, or those reflecting on his moral character. These five grounds are just causes for dismissal as provided in Article 282 of the Labor Code.

confidence.

Respondent guards were formerly employed by Triad Security who filed a complaint for illegal dismissal. After securing a favorable decision with the LA, an order was issued effecting for their reinstatement and ordered the payment of backwages (and to such further backwages as they accrue until reinstatement order is complied with by Triad Security), and a separation pay computed in the event reinstatement is no longer feasible. Triad Security was only able to satisfy the guards’ separation payments. There was a contention as to WON they were still liable for the accrued backwages of said employees even after paying their separation pay. Palteng was dismissed with forfeiture of benefits for gross negligence and dereliction of duties and grave abuse of authority. The LA, the NLRC and the CA unanimously found her dismissal illegal. Thus, she claims that she is entitled to the twin reliefs of reinstatement (or payment of separation pay if reinstatement is no longer possible) and payment of backwages. She adds that the

Dismissed employees are still entitled to accrued backwages as Art. 279 provide 2 separate and distinct reliefs for an illegally dismissed employee in the form of backwages and reinstatement.

Backwages and separation pay are, therefore, distinct reliefs granted to one who was illegally dismissed from employment. The award of one does not preclude that of the other as the court had, in proper cases, ordered the payment of both.

She is only entitled to separation pay only, without backwages, since she was not faultless in regard to the offenses imputed against her.

Reinstatement and payment of backwages are distinct and separate reliefs given to alleviate the economic setback brought about by the employee’s dismissal. The award of one does not bar the other. Backwages may be awarded without reinstatement, and reinstatement may be ordered without awarding backwages.

In a number of cases before, the Court, despite ordering reinstatement or payment of separation pay in lieu of reinstatement, has not awarded backwages as penalty for the misconduct or infraction committed by the employee.

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backwages should be computed from the time she was illegally dismissed on, until the finality of the decision. Business Day Information Systems and Services v NLRC

Company went through retrenchment, dismissed employees in batches, eventually closing the company. Employees dismissed at different points were awarded different separation pays. First batch was given 1/2 month pay for every year of service as separation pay. Second and third batches were both given 1 month pay per year of service. Second and third batches were also paid mid year bonuses. First batch argues there was unlawful discrimination in computation of separation pay.

Employees entitled to salary differentials/increase in separation pay but not mid year bonuses. (Mid year bonuses= act of generosity)

San Miguel Corp v Javate

Javate was a casual employee of the SMC. He figured in an accident and was confined in the hospital.He was on sick leave for a total of fifty six (56) days. Subsequently, he filed for several vacation leave but these were denied for not having been filed 6 days prior to effectivity. SMC "compulsorily retired" the former for alleged exhaustion of sick leave benefits based on the company's Health, Welfare and Retirement Plan.

Javate’s having accepted the benefits of the retirement plan does not estop him from challenging the validity of his dismissal.

Samahan ng mg Manggagawa sa Hyatt v Magsalin

On January 31, 2001, Hyatt’s General Manager issued a Memorandum informing all hotel employees that hotel security have been instructed to conduct a thorough bag inspection and body frisking in every entrance and exit of the hotel. Angelito Caragdag, a waiter at the hotel’s Cafe

Separation pay shall be allowed as a measure of social justice only in those instances where the employee is validly dismissed for causes other than serious misconduct or those reflecting on his moral character. Here, Caragdag’s dismissal was due to

Employer may not pay separation benefits unequally to its lawfully retrenched employees. There was impermissible discrimination against the private respondents in the payment of their separation benefits. The law requires an employer to extend equal treatment to its employees. It may not, in the guise of exercising management prerogatives, grant greater benefits to some and less to others. Management prerogatives are not absolute prerogatives but subject to legal limits, CBAs or general principles of fair play and justice. ART 283. Employees who received their separation pay are not barred from contesting the legality of their dismissal. The acceptance of those benefits would not amount to estoppel.

Grant of bonus is an exclusive prerogative of management. Employees cannot complain they were not given bonus while others were given bonuses.

Caragdag’s dismissal being due to serious misconduct, it follows that he should not be entitled to financial assistance. To rule otherwise would be to reward him for the grave misconduct he committed.

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Equitable PCI Bank v Dompor

Phil Long Distance Tel v NLRC

Daniel Paduata v MECO

Al Fresco restaurant and a director of the union, refused to be frisked by the security personnel several times. He was then suspended for 6 days as according to Hotel's Code of Discipline. When Mike Moral, the manager of Hyatt’s Cafe Al Fresco and Caragdag’s immediate superior, was about to counsel two staff members, Larry Lacambacal and Allan Alvaro, at the training room, Caragdag suddenly opened the door and yelled at the two with an enraged look. He was then suspended for 7 days. Labor Arbiter held that Caragdag was legally dismissed but awarded 100,000 pesos financial assistance to him. Dompor was employed by Equitable PCI Bank as its branch manager before he was dismissed for serious misconduct and insubordination after he was found to have not complied with company policies regarding acceptance of checks. There was a contention as to WON separation pay should be awarded in his favor. Private respondent was dismissed after she was found to have accepted money without issuing a proper receipt in order to expedite the telephone installation applications of 2 customers. The LA and the NLRC awarded her financial assistance considering her long service to the company.

several instances of willful disobedience to the reasonable rules and regulations prescribed by his employer. Caragdag’s infractions were not even spread in a period of twelve (12) months, but rather in a period of a little over a month. A series of irregularities when put together may constitute serious misconduct, which under Article 282 of the Labor Code, as amended, is a just cause for dismissal.

Employee started incurring several absences supposedly due to rheumatic arthritis after being transferred to Meralco’s Centra Office in the Manila District to do

Dompor should not be awarded separation pay.

Separation pay shall be allowed as a measure of social justice only in those instances where the employee is validly dismissed for cause other than serious misconduct or wilful disobedience.

She is not entitled to financial assisstance as she was dismissed for dishonesty.

Separation pay shall be allowed as a measure of social justice only in those instances where the employee is validly dismissed for causes other than serious misconduct or those reflecting on his moral character. It should be computed at the rate of one month salary for every year of service.

Employee did not comply with notice requirements for sick leave absence as indicated in the Company’s employee code.

Burden was on employee to prove his absences were authorized and excused. Employee failed to submit any credible proof that he gave prior notice of his absences or that

Paduata claims that shortly before MERALCO issued its notice of dismissal, it offered him separation pay, apparently to avoid a

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work as an Acting Stockman. Meralco claims such absences were unauthorized and unexcused since the employee failed to submit the required medical certificate after the absences were incurred. An investigation found the employee ivolated the company’s code of employee dismissal and wrote the employee informing him of his dismissal from the service due to absence.

AMA Computer College v Ignacio

Alba v Yupangco

Ignacio was employed by AMA as Management Trainee. Eventually, he was given a permanent status. Pursuant to a renovation plan, Ignacio started demolishing the concrete partition wall of the computer laboratory. The Audit Department of AMA Computer College, Inc. filed a complaint against respondent, charging him with "(t)hreatening to damage company property, negligence or failure to exercise adequate asset control measures within one’s area of responsibility." He was terminated from employment. He filed for illegal dismissal before the Labor Arbiter, impleading Aguiluz and Cruz, in their capacity as AMACCI officials. Querubin L. Alba and Rizalinda D. De Guzman filed separate complaints for illegal dismissal and payment of retirement benefits against Y.L. Land Corporation and Ultra Motors Corporation, respectively. Robert L. Yupangco was impleaded in his capacity as President of both corporations. The Labor Arbiter held that respondent’s

No liability for Ignacio’s illegal dismissal should attach to Aguiluz and Cruz. The complaint pertaining to them is dismissed.

he submitted the certificates needed to justify them. He relied solely on his own affidavit. Not enough for the court in this case.

dispute with him. Considering what the Court said in Eastern Shipping Lines, Inc. v. Sedan that financial assistance may be allowed as a measure of social justice and exceptional circumstances, such may be extended to Paduata who apparently suffered from recurring illness that prevented him from doing his work

Unless they have exceeded their authority, corporate officers are, as a general rule, not personally liable for their official acts, because a corporation, by legal fiction, has a personality separate and distinct from its officers, stockholders and members.

EXCEPTION: Corporate directors and officers are solidarily held liable with the corporation, where terminations of employment are done with malice or in bad faith; but where there is an absence of evidence that said directors and officers acted with malice or bad faith, as in this case, the Court must exempt them from any personal liability for the employee’s illegal dismissal."

In labor cases, for instance, the Court has held corporate directors and officers solidarily liable with the corporation for the termination of employment of employees done with malice or in bad faith. From the October 25, 1999 Decision of the Labor Arbiter, there is no finding or indication that petitioners’ dismissal was A2015 LABOR FINALS REVIEWER- Roe, Maan, Lindsey, Kimmie, Kor and Mica

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liability is solidary.

effected with malice or bad faith. Respondent’s liability could thus only be joint, not solidary. RETIREMENT IBC is estopped from refusing to pay employees’ taxes from retirement benefits.

Intercontinental Broad Corp GR 162775 Oct 27 2006

Respondents are retired employees of IBC seeking for tax exemption of their retirement benefits pursuant to their company’s optional retirement scheme.

Jaculbe v Siliman

Respondent’s retirement plan for its employees provided that its members could be automatically retired "upon reaching the age of 65 or after 35 years of uninterrupted service to the university." Petitioner contends that the compulsory retirement was tantamount to a dismissal and that it violates the security of tenure clause in the Constitution.

The Court found that the Plan was not voluntary. Also, it cannot be said to be part of petitioner's employment contract as it was implemented after she was already hired. IN THIS CASE, it violated the security of tenure clause.

Reyes v NLRC

Petitioner seeks to add sales commissions onto his basic salary for computation of his retirement benefits. Inclusion of such would increase his retirement pay by around P700,000.

Sales commissions excluded from computation of retirement benefits based on basic salary.

An agreement to pay taxes on the retirement benefits as an incentive to prospective retirees and for them to avail of an optional retirement scheme is not contrary to law or public morals. Retirement plans allowing employers to retire employees who are less than the compulsory retirement age of 65 are not per se repugnant to the constitutional guaranty of security of tenure. Art 287 of the LC permits employers and employees to fix the applicable retirement age at below 60 years. However, such must be voluntarily consented to by the employee. Any seeming inconsistencies between Philippine Duplicators and Boie Takeda Chemicals had been clarified byt he Court in a resolution. Commissions in PD comprised a pre-determined percentage and were properly included in "basic salary". These are not OT payments or profit sharing payments nor any other fringe benefit but a portion of the salary structure which represents an automatic increment to the monetary value initially assigned to each unit of work rendered by a salesman. Different from BT case. Medical reps not salesmen. Commissions in this case were paid

Profit sharing payments (commissions) explicitly prohibited by Sec 5 of Rule II of the Rules Implementing the New Retirement Law and PD 851, as clarified in San Miguel Corp v Inciong. In the absence of any provision on optional retirement in a CBA, other employment contract or employer's retirement plan, an employee may optionally reitre upon reaching the age of 60 years or more but not beyond 65 provided he has served at least 5 years in the establishment

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as productivity bonuses

Universal Robina Sugar Miling corp v Caballeda

Enriquez Security Services v Cabotaje

Caballeda worked as welder for URSUMCO. A memorandum was issued, establishing the company policy on ""Compulsory Retirement"" of its employees. The memorandum provides that all employees corporate-wide who attain 60 years of age on or before April 30, 1991 shall be considered retired on May 31, 1991. Henceforth, any employee shall be considered retired 30 days after he attains age 60. Subsequently, RA No. 7641 was enacted, amending Article 287 of the Labor Code. Caballeda averred that URSUMCO illegally dismissed him from employment on when he was forced to retire upon reaching the age of 60 years old. Sometime in January 1979, respondent Victor A. Cabotaje was employed as a security guard by Enriquez Security and Investigation Agency (ESIA). On November 13, 1985, petitioner Enriquez Security Services, Inc. (ESSI) was incorporated. Respondent continued to work as security guard in petitioner’s agency. On reaching the age of 60 in July 1997,1 respondent applied for retirement. Petitioner acknowledged that respondent was entitled to retirement benefits but opposed his claim that the computation of such benefits must be reckoned from January 1979 when he started working for ESIA. It claimed that the

RA 7641 may be applied retroactively. URSUMCO failed to prove that Caballeda was not eligible for the retirement benefits provided under RA 7641. He is thus entitled to the benefits therein provided.

The law can apply to labor contracts still existing at the time the statute has taken effect, and that its benefits can be reckoned not only from the date of the law's enactment but retroactively to the time said employment contracts have started. Two essential requisites in order that R.A. 7641 may be given retroactive effect: 1) the claimant for retirement benefits was still in the employ of the employer at the time the statute took effect; and 2) the claimant had complied with the requirements for eligibility for such retirement benefits under the statute.

Petitioner’s insistence that only 1/12 of the service incentive leave (SIL) should be included in the computation of the retirement benefit has no basis. Section 1, RA 7641 provides:

Section 5.2, Rule II of the Implementing Rules of Book VI of the Labor Code further clarifies what comprises the "1/2 month salary" due a retiring employee: 5.2 Components of One-half (1/2) Month Salary. – For the purpose of determining the minimum retirement pay due an employee under this Rule, the term "one-half month salary" shall include all the following: (a) Fifteen (15) days salary of the employee based on his latest salary rate. x x x; (b) The cash equivalent of not more than five (5) days of service incentive leave;

x x x Unless the parties provide for broader inclusions, the term onehalf (1/2) month salary shall mean fifteen (15) days plus one-twelfth (1/12) of the 13th month pay and the cash equivalent of not more than five (5) days of service incentive leave. x x x

concerned. 2 types of retirement: compulsory (65) and optional (60 but not beyond 65, provided he worked 5 years at the establishment).

The foregoing rules are clear that the whole 5 days of SIL are included in the computation of a retiring employees’ pay.

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benefits must be computed only from November 13, 1985 when ESSI was incorporated.

(c) One-twelfth of the 13th month pay due an employee; (d) All other benefits that the employer and employee may agree upon that should be included in the computation of the employee’s retirement pay.

Ozales v Unilab

Oxales was a retired employee of Unilab who insisted that his bonuses, allowances and 13th month pay should have been included in the computation of his retirement benefits. However, Unilab argues to the contrary pursuant to the company’s United Retirement Plan.

The URP of Unilab should be upheld. In this case, RA 7641 does not apply in view of the URP which gives to the retiring employee more than what the law requires.

A retirement plan in a company partakes the nature of a contract, with the employer and the employee as the contracting parties. It creates a contractual obligation in which the promise to pay retirement benefits is made in consideration of the continued faithful service of the employee for the requisite period.

Gerlach v Reuters

Petitioner worked for Reuters. She worked in different countries, though her homebase was always Manila.

Petitioner’s retirement benefits must be based on her notional Philippine salary. She was always

3 Kinds of Retirement Schemes: 1. compulsory and contributory in

"The Retirement Pay Law," only applies in a situation (1) there is no collective bargaining agreement or other applicable employment contract providing for retirement benefits for an employee; or (2) there is a collective bargaining agreement or other applicable employment contract providing for retirement benefits for an employee, but it is below the requirements set for by law. The reason for the first situation is to prevent the absurd situation where an employee, who is otherwise deserving, is denied retirement benefits by the nefarious scheme of employers in not providing for retirement benefits for their employees. The reason for the second situation in the maxim pacta private juri public derogare non possunt. Private contracts cannot derogate from the public law.

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Whenever she was transferred, she would receive a letter from Reuters appraising her of the details her benefits which was explicitly said to be based on her notional salary. She now claims that it should be based on her actual salary.

appraised of this. Also, Reuters was able to prove that it has been its practice worldwide that the notional salary of an employee is its basis in computing its contribution to the retirement plan for a local employee detailed abroad. Section 14(a), Rule 1 of the Rules and Regulations Implementing Book VI of the LC: "Sec. 14. Retirement benefits. – (a) An employee who is retired pursuant to a bona fide retirement plan or in accordance with the applicable individual or collective agreement or established employer policy shall be entitled to all the retirement benefits provided therein . . ."

character 2. set up by agreement between the employer and employees in collective bargaining agreements or other agreements between them 3. voluntarily given by the employer, expressly as in an announced company policy or impliedly as in a failure to contest the employee's claim for retirement benefits (as was in this case)

Gratuity pay is separate and distinct from retirement benefits-it is paid purely out of generosity. Retirement benefits are a form of reward for employee's loyalty to the employer. Part of the retirement benefits was the PERRA (Private Education Retirement Annuity Association) which respondent had already received. It was the school's substitute retirement plan established a year after respondent left the school. Whichever between the retirement plan stipulated in the CBA and Article 287 of the LC is more beneficial to the employee shall be

Sta Catalina v. NLRC

Respondent abandoned work after not showing up after her year long LOA. She disappeared for more than a decade and taught at another school. She reapplied in petitioner school. When she retired, petitioner refused to pay her for the decade she was MIA. CA and respondent assert however, that since petitioner school gave her a Plaque of Appreciation for 30 years of service, it was though they acknowledged the decade

Respondent's time she was MIA should not be included in the computation of retirement benefits

PAL v Airline Pilots Association

PAL unilaterally retired airline pilot Captain Collantes under Section 2, Article VII, of the 1967 PAL-ALPAP Retirement Plan. ALPAP: The

The PAL-ALPAP Retirement Plan, and not Article 287 of the LC, should be the basis for the grant of Capt. Collantes’ retirement

Art 287 (par. 1): deals with the retirement age of an employee established in (a) a CBA or (b) other applicable employment contract. Art 287 (par 2): deals with the retirement benefits to be received by a retiring employee which he may have earned under (a) an existing law, (b) CBA or (c) other agreements.

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Ariola v Philex Mining Corp

Equitable PCI Bank v Caguia

Sy v Metropolitan Bank and Trust Company

retirement of Captain Collantes constituted illegal dismissal. ALPAP filed a Notice of Strike with the DOLE. The DOLE Secretary recognized the act of PAL as a valid exercise of its option under Section 2, Article VII, of the 1967 PAL-ALPAP Retirement Plan.

benefits. The retirement benefits that a pilot would get under the provisions of the above-quoted Article 287 of the Labor Code are less than those that he would get under the applicable retirement plans of petitioner.

the basis for the grant of retirement benefits to retiring employees.

In 1992, Philex sustained financial losses in its operations. To save costs, Philex adopted several measures including reducing personnel through early voluntary retirement and retrenchment programs. On 1 June 1993, petitioners, with six other supervisors and 49 rank-andfile employees, received from Philex termination notices informing them of their retrenchment under their respective MOAs effective 30 June 1993. Philex paid them separation pay. All of them signed Deeds of Release and Quitclaim in Philex’s favor. The labor arbiter held that from the evidence presented, it clearly appears that complainants voluntarily retired from the company for a valuable consideration. The quitclaim[s] executed in favor of the company [amount]to a valid and binding agreement. Caguioa had been an employee of Equitable PCI Bank for 35 years prior to her dismissal from service after the bank found her guilty of violations of its Code of Conduct. Caguioa was seeking leniency in consideration of her 35 years of service to the bank. Petitioner was involved in a "kiting" scheme for which he was justly dismissed. The main issue in this case

Under Philex’s Retirement Gratuity Plan, “retirement gratuity” is paid not only to retiring employees but also to those who, like petitioners, are dismissed for cause “beyond their control” such as retrenchment. Indeed, Philex treated the “retirement gratuity” as petitioners’ basic separation pay, which, with transportation allowance, comprised their “net separation *pay+” as indicated in Deeds of Release and Quitclaims petitioners signed. Significantly, Philex paid petitioners such separation pay after notifying them of their retrenchment.

Thus if, as in the present case, the intent to retire is not clearly established or if the retirement is involuntary, it is to be treated as a discharge.

Caguioa’s dismissal is valid. Her retirement benefits may be forfeited.

Employees who are validly dismissed from service by reason of timely discovered offenses may be deprived of retirement benefits.

Since petitioner’s dismissal was for a just cause, he is not entitled to any

Under the Labor Code, only unjustly dismissed employees are entitled to retirement benefits and

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is whether an employee who was validly dismissed is still entitled to his retirement benefits.

retirement benefit.

PLDT v Reus

Respondent filed complaint for illegal dismissal and claims for monetary damages in 1990. NLRC issued an Order in 1993 for the manner of payment of respondent's monetary claims. After a series of appeals and writs of executions and modifications (particularly one by NLRC which granted P2000 to respondent), respondent was still not paid and CA granted petition for mandamus of the 1993 decision

CA: no reversible error, The execution of the 1993 NLRC decision has been long overdue; it became final and executory when the Court dismissed the petitions for certiorari.

Rivera v Unilab

Rivera was employed by UNILAB. UNILAB adopted a comprehensive retirement plan. Under the plan, a member is compulsorily retired upon reaching the normal retirement date which is the date when the member has reached age 60 or has completed 30 years of service, whichever comes first. Rivera completed 30 years of service and UNILAB retired her. Her retirement benefits have already been granted her. At her request, UNILAB allowed her to continue working for the company; she was even promoted. Eventually, she retired from employment in 1992.

Her retirement benefits are covered by the retirement plan effective upon her completion of 30 years of service. She is not covered by the Retirement Plan Law subsequently passed. Article 287 of the Labor Code and Section 13 of the Rules to Implement the Labor Code were the governing laws at the end of 1988 when the petitioner compulsorily retired under the UNILAB retirement plan. Her renewed service did not have the benefit of any retirement plan coverage. Because of this, she did not qualify under the terms of the

other privileges including reinstatement and backwages. There is a forfeiture of retirement benefits in valid dismissal cases. 1993 NLRC decision modified the LA's decision directing petitioner to pay P2000 as indemnity and any retirement benefits he may be entitled under the company's retirement plan . An undisputed modification that the 1993 NLRC decision decreed is the deletion of the order for the payment of indemnity and atty's fees. A second ovious change is the removal of the order for payment of pretirement beenfits that the complainant may be entitled to under the reitrement plan. The NLRC simply ordered "the respondent to pay complainant benefits under the company retirement plan less the amount of the lost collection and other outstanding obligations of the complainant with the company. Retirement pay differential may be granted to qualified employees. Requisites: 1) employment must be covered by a retirement plan; 2) if not, employment not covered by a retirement plan must have lasted for 5 years.

NLRC apparently wanted to order payment, not strictly based on the law for there was a cited cause for dismissal, nor on the eligibility terms of the company's retirement plan for he was not being retired, but on the basis of equity, it was simply applying the benefits of the plan as a measure of what should be paid as "equitable solution"

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Korean Air Co Ltd v Yuson

The company amended its retirement plan, providing, among others, for an increase in retirement benefits from one (1) month to oneand-a-half (1.5) months of terminal basic salary for every year of service. The amendment also provides that ""[T]he effective date of normal or mandatory retirement from the Plan is 30 days after an employee reaches his/her 60th birthday. Rivera asked that her retirement benefits be increased in accordance with the amended retirement program. UNILAB denied. In July 1975, Korean Air Co., Ltd.(Korean Air) hired Adelina A.S. Yuson as reservations agent. Korean Air promoted Yuson to assistant manager in 1993, and to passenger sales manager in 1999. In 2000, Korean Air suffered a net loss of over $367,000,000. Consequently, Korean Air reduced its budget for 2001 by 10 percent. In order to cut costs, Korean Air offered its employees an early retirement program (ERP). In a letterdated 23 August 2001 and addressed to Korean Air’s Philippine general manager Suk Kyoo Kim (Suk), Yuson accepted the offer for early retirement. In a letter dated 24 August 2001, Suk informed Yuson that she was excluded from the ERP because she was retiring on 8 January 2002. In a letter dated 1 September 2001 and addressed to Suk, Yuson claimed that Korean Air was bound by the perfected contract and accused the company of harassment and discrimination.

Retirement Pay Law subsequently enacted when she was retired in 1992.

Approval of applications for the ERP is within Korean Air’s management prerogatives. The exercise of management prerogative is valid as long as it is not done in a malicious, harsh, oppressive, vindictive, or wanton manner.[42]

In the present case, the Court sees no bad faith on Korean Air’s part. The 21 August 2001 memorandum clearly states that Korean Air, on its discretion, was offering ERP to its employees. The memorandum also states that the reason for the ERP was to prevent further losses. Korean Air did not abuse its discretion when it excluded Yuson in the ERP. To allow Yuson to avail of the ERP would have been contrary to the purpose of the ERP.

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