Batong Buhay Goldmines Inc vs De la Serna 312 SCRA 22 (1999)

FACTS: 5 February 1987 - Elsie Rosalinda B. Ty, Antonia L. Mendelebar, Ma. Concepcion O.

Reyes and 1,247 others filed a complaint against Batong Buhay Gold Mines, Inc. for:1. Non-payment of their basic pay and allowances for the period of 6 July 1983 to 5

July 1984, inclusive, under Wage Order No. 22. Non-payment of their basic pay and allowances for the period 16 June 1984 to 5

October 1986, inclusive under Wage Order No. 53. Non-payment of their salaries for the period 16 March 1986 to the present4. Non-payment of their 13th month pay for 1985, 1986 and 19875. Non-payment of their vacation and sick leave, and the compensatory leaves of

mine site employees6. Non-payment of the salaries of employees who were placed on forced leaves

since November, 1985 to the present, if this is not feasible, the affected employees be awarded corresponding separation pay.

On 27 February 1987, the complainants filed a Motion for the issuance of an inspection authority.

On 13 July 1987, the Labor Standards and Welfare Officers submitted their report recommending that an Order of Compliance be issued directing respondent Batong Buhay Gold Mines Inc. to pay complainants' Elsie Rosalina Ty, et al. (P4,818,746.40) by way of unpaid salaries of workers from March 16, 1987 to present, unpaid and ECOLA differentials under Wage Order Nos. 2 and 5 unpaid 13th months pay for 1985 and 1986, and unpaid (sic) vacation/sick/compensatory leave benefits. And on 31 July 1987, the Regional Director1 adopted the recommendation of the LSWOs and issued an order directing the respondent to pay the complainants of the said amount

On 31 July 1987, the Regional Director1 adopted the recommendation of the LSWOs and issued an order directing the respondent to pay the complainants

When the respondent failed to post a cash/surety bond, and upon motion for the issuance of a writ of execution by the complainants, the Regional Director, on 14 September 1987 issued a writ of execution appointing Mr. John Espiridion C. Ramos as Special Sheriff and directing him to collect the amount, otherwise he has to execute this writ by attaching the goods and chattels of BBGMI and not exempt from execution or in case of insufficiency thereof against the real or immovable property of the respondent.

The Special Sheriff proceeded to execute the appealed Order on 17 September 1987 and seized three (3) units of Peterbuilt trucks and then sold the same by public auction. Various materials and motor vehicles were also seized on different dates and sold at public auction by said sheriff.

BBGMI appealed the Order dated July 31, 1987 of Regional Director Luna C. Piezas to respondent Undersecretary Dionisio de la Serna, contending that the Regional Director had no jurisdiction over the case.

ISSUE: Whether Regional Director has jurisdiction over the complaint filed by the employees of BBGMI.

HELD:The Regional Director has jurisdiction over the BBGMI employees who are the complainants. The subject labor standards case of the petition arose from the visitorial and enforcement powers by the Regional Director of Department of Labor and Employment (DOLE). Labor standards refers to the minimum requirements prescribed by existing laws, rules and regulations relating to wages, hours of work, cost of living allowance and other monetary and welfare benefits, including occupational, safety and health standards.4 Labor standards cases are governed by Article 128(b) of the Labor Code.

Art. 128 (b) Visitorial and enforcement powers —(b) The Minister of Labor or his duly authorized representative shall have the power to order and administer, after due notice and hearing, compliance with the labor standards provisions of this Code based on the findings of labor regulation officers or industrial safety engineers made in the course of inspection, and to issue writs of execution to the appropriate authority for the enforcement of their order, except in cases where the employer contests the findings of the labor regulations officers and raises issues which cannot be resolved without considering evidentiary matters that are not verifiable in the ordinary course of inspection.

Respondent Undersecretary Dionisio C. Dela Serna, on the other hand, upheld the jurisdiction of Regional Director Luna C. Piezas by relying on E.O. 111, to quote:

Considering therefore that there still exists an employer-employee relationship between the parties; that the case involves violations of the labor standard provisions of the labor code; that the issues therein could be resolved without considering evidentiary matters that are not verifiable in the normal course of inspection; and, if only to give meaning and not render nugatory and meaningless the visitorial and enforcement powers of the Secretary of Labor and Employment as provided by Article 128(b) of the Labor Code, as amended by Section 2 of Executive Order No. 111 which states:

The provisions of article 217 of this code to the contrary notwithstanding and in cases where the relationship of employer-employee still exists, the Minister of Labor and Employment or his duly authorized representative shall have the power to order and administer, after due notice and hearing, compliance with the labor standards provision of this Code based on the findings of the findings of labor regulation officers or industrial safety engineers made in the course of inspection, and to issue writs of execution to the appropriate authority for the enforcement of their order, except in cases where the employer contests the

findings of the labor regulations officers and raises issues which cannot be resolved without considering evidentiary matters that are not verifiable in the ordinary course of inspection.

We agree with the complainants that the regional office a quo has jurisdiction to hear and decide the instant labor standard case.

The Court in reinforcing its conclusion that Regional Director has jurisdiction over labor standards cases, treated E.O. 111 as a curative statute, ruling as follows:

E.O. No. 111 was issued on December 24, 1986 or three (3) months after the promulgation of the Secretary of Labor's decision upholding private respondents' salary differentials and ECOLAs on September 24, 1986. The amendment of the visitorial and enforcement powers of the Regional Director (Article 128(b)) by said E.O. 111 reflects the intention enunciated in Policy Instructions Nos. 6 and 37 to empower the Regional Directors to resolve uncontested money claims in cases where an employer-employee relationship still exists. This intention must be given weight and entitled to great respect

Republic Act 7730, the law governing the visitorial and enforcement powers of the Labor Secretary and his representatives reads:

Art. 128 (b) Notwithstanding the provisions of Articles 129 and 217 of this Code to the contrary, and in cases where the relationship of employer-employee still exists, the Secretary of Labor and Employment or his duly authorized representatives shall have the power to issue compliance orders to give effect to the labor standards provisions of this Code and other labor legislation based on the findings of labor employment and enforcement officers or industrial safety engineers made in the course of inspection. The Secretary or his duly authorized representative shall issue writs of execution to the appropriate authority for the enforcement of their orders, except in cases where the employer contests the findings of the labor employment and enforcement officer and raises issues supported by documentary proofs which were not considered in the course of inspection.

The present law, RA 7730, can be considered a curative statute to reinforce the conclusion that the Regional Director has jurisdiction over the present labor standards case. Well-settled is the rule that jurisdiction over the subject matter is determined by the law in force when the action was commenced, unless a subsequent statute provides for its retroactive application, as when it is a curative legislation.

PEÑARANDA vs. BAGANGA PLYWOOD

FACTS:

Peñaranda alleges that he was employed by respondent as Foreman/Boiler Head/Shift Engineer; that he was illegally dismissed; And, his overtime pay, premium pay for working during holidays/rest days, night shift differentials were not paid.

Respondent allege that complainant’s separation from service was done pursuant to Art. 283 of the Labor Code.

Respondent BPC was on temporary closure due to repair and had to dismiss employees. Penaranda also got his separation benefits. Consequently, when respondent partially reopened in January 2001, Peñaranda failed

to reapply. Hence, he was not terminated from employment illegally. The labor arbiter found that petitioner is entitled to overtime pay, premium pay for

working on rest days

ISSUE: WON Penaranda is entitled to overtime pay and premium pay for working on rest days?

RULING: Managerial employees and members of the managerial staff are exempted from the provisions of the Labor Code on labor standards.

Since petitioner belongs to managerial staff, he is not entitled to overtime pay and premium pay for working on rest days.

Penaranda duties and responsibilities conform to the definition of a member of a managerial staff under the Implementing Rules.

Petitioner supervised the engineering section of the steam plant boiler. His work involved overseeing the operation of the machines and the performance of the workers in the engineering section.

This work necessarily required the use of discretion and independent judgment to ensure the proper functioning of the steam plant boiler.

As supervisor, petitioner is deemed a member of the managerial staff.

Noteworthy, even petitioner admitted that he was a supervisor. In his Position Paper, he stated that he was the foreman responsible for the operation of the boiler.

The term foreman implies that he was the representative of management over the workers and the operation of the department.

Petitioner’s evidence also showed that he was the supervisor of the steam plant.

His classification as supervisor is further evident from the manner his salary was paid. He belonged to the 10% of respondent’s 354 employees who were paid on a monthly basis; the others were paid only on a daily basis.

On the basis of the foregoing, the Court finds no justification to award overtime pay and premium pay for rest days to petitioner.

CMS ESTATE INC VS SSS 132 SCRA 106 (1984)

Art. II Sec 18 (1987 Constitution): The State affirms labor as a primary social economic force. It shall protect the rights of workers and promote their welfare

Art. XIII Sec 1: The Congress shall give highest priority to the enactment of measures that protect and enhance the right of all the people to human dignity, reduce social, economic and political inequalities, and remove cultural inequalities by equitably diffusing wealth and political power for the common good.To this end, the State shall regulate the acquisition, ownership, use and disposition of property and its increments.

FACTS: Petitioner CMS Estate Inc is a domestic corporation engaged in the real estate business. In December 1952, it began with only 6 employees. In 1956, it also engaged in the logging business and obtained an ordinary license from the Bureau of Forestry to operate forest concession (13,000 hectares) in Baganga, Davao.

In January 1957, CMS Estate entered into a contract of management with Eufracio Rojas for the operation of the logging concession which began in April 1957 with four employees earning monthly salaries. By September 1957, CMS Estate had 89 employees in the logging operation. But on December 1957, CMS Estate revoked its contract with Rojas.

By August 1958, CMS Estate became a member of SSS with respect to its real estate business and remitted to the SSS P203.13 representing the initial premium of the salaries of the employees in the logging business. But on October 1958, petitioner demanded the refund of the amount, alleging that it is not yet subject to compulsory coverage in its logging business. Respondent SSS denied the petition on the ground that the logging business is only an expansion of the company’s existing activities and that it should be considered a member since December 1952 when it opened its business.

CMS Estate contends that the SSS contributions required of employees and employers under the SSS Act of 1954 are not in the nature of excise taxes and therefore, not compulsory of employers.

ISSUE: W/N Petitioner’s logging business is subject to compulsory coverage in the SSS

HELD: The Social Security Law was enacted pursuant to the policy to “develop, establish gradually and perfect a social security system which shall be suitable to the needs of the people throughout the Philippines and provide protection against the hazards of disability, sickness, old age and death.” It is clear then that the implementation of the SSS Law is in line with the general welfare mandate of the Constitution and as such, is a legitimate exercise of the police power. As held in Philippine Blooming Mills Co. vs. SSS: membership in the SSS is not a bilateral, consensual agreement where obligations and rights of the parties are subject to their will. RA 1161 requires compulsory coverage of employees and employers under the system. As such, the principle of non-impairment of obligation of contract cannot be raised as a defense.Mariveles Shipyard Corp. v CA 415 SCRA 573 (2003)

FACTS:

On October 1993, petitioner Mariveles Shipyard Corporation engaged the services of Longest Force Investigation and Security Agency, Inc. (hereinafter, “Longest Force”) to render security services at its premises. Longest Force deployed its security guards, the private respondents herein, at the petitioner’s shipyard in Mariveles, Bataan.

Mariveles Shipyard Corp complied with the terms of the security contract with Longest Force, promptly paying its bills and the contract rates of the latter. However, it found the services being rendered by the assigned guards unsatisfactory and inadequate, causing it to terminate its contract with Longest Force on April 1995. Longest Force, in turn, terminated the employment of the security guards it had deployed at petitioner’s shipyard.

On September 2, 1996, private respondents filed a case for illegal dismissal, underpayment of wages pursuant to the PNPSOSIA-PADPAO rates, non-payment of overtime pay, premium pay for holiday and rest day, service incentive leave pay, 13 th

month pay and attorney’s fees, against both Longest Force and petitioner, before the Labor Arbiter, the case sought the guards’ reinstatement with full backwages and without loss of seniority rights.

Longest Force filed a cross-claim against the petitioner. Longest Force admitted that it employed private respondents and assigned them as security guards at the premises of petitioner from October 16, 1993 to April 30, 1995, rendering a 12 hours duty per shift for the said period. It likewise admitted its liability as to the non-payment of the alleged wage differential in the total amount of P2,618,025 but passed on the liability to petitioner alleging that the service fee paid by the latter to it was way below the PNPSOSIA and PADPAO rate, thus, “contrary to the mandatory and prohibitive laws because the right to proper compensation and benefits provided under the existing labor laws cannot be waived nor compromised.”

The petitioner denied any liability on account of the alleged illegal dismissal, stressing that no employer-employee relationship existed between it and the security guards. It further pointed out that it would be the height of injustice to make it liable again for monetary claims which it had already paid. Longest Force filed a cross-claim against the petitioner.

Labor Arbiter decided that the respondents Longest Force Investigation & Security Agency, Inc. and Mariveles Shipyard Corporation jointly and severally liable to pay the money claims of complainants representing underpayment of wages and overtime pay in the total amount.

ISSUE: Whether or not Mariveles Shipyard Corp and Longest Force Investigation & Security Agency, Inc. is jointly and severally liable to pay money claims of the private respondents.

HELD:Petitioner’s liability is joint and several with that of Longest Force, pursuant to Articles 106, 107 and 109 of the Labor Code which provide as follows:

ART. 106. CONTRACTOR OR SUBCONTRACTOR – Whenever an employer enters into a contract with another person for the performance of the former’s work, the employees of the

contractor and of the latter’s subcontractor, if any, shall be paid in accordance with the provisions of this Code.

In the event that the contractor or subcontractor fails to pay the wages of his employees in accordance with this Code, the employer shall be jointly and severally liable with his contractor or subcontractor to such employees to the extent of the work performed under the contract, in the same manner and extent that he is liable to employees directly employed by him.

ART. 107. INDIRECT EMPLOYER. – The provisions of the immediately preceding Article shall likewise apply to any person, partnership, association or corporation which, not being an employer, contracts with an independent contractor for the performance of any work, task, job or project.

ART. 109. SOLIDARY LIABILITY. – The provisions of existing laws to the contrary notwithstanding, every employer or indirect employer shall be held responsible with his contractor or subcontractor for any violation of any provision of this Code. For purposes of determining the extent of their civil liability under this Chapter, they shall be considered as direct employers.

In this case, when petitioner contracted for security services with Longest Force as the security agency that hired private respondents to work as guards for the shipyard corporation, petitioner became an indirect employer of private respondents pursuant to Article 107 abovecited. Following Article 106, when the agency as contractor failed to pay the guards, the corporation as principal becomes jointly and severally liable for the guards’ wages. This is mandated by the Labor Code to ensure compliance with its provisions, including payment of statutory minimum wage. The security agency is held liable by virtue of its status as direct employer, while the corporation is deemed the indirect employer of the guards for the purpose of paying their wages in the event of failure of the agency to pay them. This statutory scheme gives the workers the ample protection consonant with labor and social justice provisions of the 1987 Constitution.

Petitioner cannot evade its liability by claiming that it had religiously paid the compensation of guards as stipulated under the contract with the security agency. Labor standards are enacted by the legislature to alleviate the plight of workers whose wages barely meet the spiraling costs of their basic needs. Labor laws are considered written in every contract. Stipulations in violation thereof are considered null. Similarly, legislated wage increases are deemed amendments to the contract. Thus, employers cannot hide behind their contracts in order to evade their (or their contractors’ or subcontractors’) liability for noncompliance with the statutory minimum wage.

KASAPIAN NG MALAYANG MANGGAGAWA SA COCA-COLA vs. CA and COCA-COLA BOTTLERS’ PHILS.,

FACTS:

June 1998, the Contract Bargaining Agreement for the years 1995-1998 executed between petitioner union and private respondent company expired.

Petitioner then submitted its demands to the company for another round of collective bargaining negotiations.

After having some labor disputes, on 26 December 1998, both parties executed and signed a MOA providing for salary increases and other economic and non-economic benefits.

It likewise contained a provision for the regularization of contractual, casual and/or agency workers who have been working with private respondent for more than one year.

Pursuant to the provisions of the MOA, both parties identified 64 vacant regular positions that may be occupied by the existing casual, contractual or agency employees who have been in the company for more than one year.

Then, 61 employees passed the screening and extended regular employment status. Consequently, petitioners demanded the payment of salary and other benefits to the newly

regularized employees retroactive to 1 December 1998, in accord with the MOA. However, the private respondent refused to yield the said demands contending that the date of

effectivity of the regularization of said employees were 1 May 1999 and 1 October 1999. Thus, petitioner filed a complaint before the NLRC for the alleged violations of the subject MOA

by the private respondent. On 9 December 1999, private respondent closed its Manila and Antipolo plants. NLRC dismissed the complaint. It stated that: Under MOA, the 61 regularized employees are not

entitled to their claims only the employees who were regular in July 1998 and continued being such upon the signing of the MOA on December 26, 1998 deserve retroactive payment. Since the 61 regularized employees were regularized only on May 1, 1999 and October 1, 1999, they have no right to claim entitlement to the MOA benefits.

ISSUE:WON CCBP violated the terms and conditions contained in the MOA dated 26 December 1998 when it did not recognize the regularization of the 61 employees as effective on 1 December 1998?

RULING:Private respondent violated the provision of the MOA when it did not consider the regularization of the 61 employees effective 1 December 1998, and accorded to them the full benefits of the MOA.

According to the pertinent provision of the MOA:1. Non-regular employee (casual, contractual or agency worker) who has already served the company and is presently occupying or has occupied the position to be filled-up for at least one (1) year shall be given priority in filling-up the position by converting his non-regular employment status to regular employment status, effective 01 December 1998 without need of undergoing through the company’s regular recruitment procedures such as interview and qualifying examination.

It is erroneous for the NLRC to conclude that the regularization of the 61 employees does not retroact to December 1, 1998.

We hold that the effectivity date of the regularization of the 61 employees was on December 1, 1998.

As stated in the MOA, only those who have worked with the company for one year as of 1 December 1998 and are still working for the company as of the signing of the MOA, will be considered for regularization.

Evidently, it is erroneous for the NLRC to conclude that extending to them the benefits of the MOA would violate the principle of "no-work-no-pay" as they are actually rendering service to the company even before December 1, 1998, and continued to do so. They were accorded the status of regular employees because they were rendering service to the company for the required period.

Hence, even without the subject MOA provision, the 61 employees must be extended regular employment status after the lapse of one year. All those who have been with the company for one year by said date must automatically be considered regular employees by operation of law.

DOLE PHILIPPINES VS PAWISANG MAKABAYANG OBRERO 395 SCRA 112 (2003)

Book Five, Rule I, Sec. 1(jj): Collective bargaining agreement refers to the negotiated contract between a legitimate labor organization and the employer concerning wages, hours of work, and all other terms and conditions of employment in a bargaining unit, including mandatory provisions for grievances and arbitration machineries.

FACTS: On February 22, 1996, a new five-year collective bargaining agreement (CBA) was executed by petitioner Dole Philippines and Pawis ng Makabayang Obrero (PAMAO), covering February 1996 to February 2001. One of the provisions in the new CBA reads: (Section 3 of Art. XVIII) Dole agrees to grant a meal allowance of Php 10.00 to all employees who render at least 2 hours or more of actual overtime work on a workday, and free meals, as presently practice, not exceeding Php 25.00 after 3 hours of actual overtime work.

Pursuant to the provisions of the CBA, some departments reverted to the previous practice of granting free meals after exactly 3 hours OT but other departments granted free meals only after more than 3 hours OT. PAMAO then filed a complaint alleging Dole’s non-compliance to the CBA.

ISSUE: HOW MANY HOURS OF OVERTIME WORK MUST A DOLE EMPLOYEE RENDER TO BE ENTITLED TO THE FREE MEAL UNDER SEC. 3 OF ART. XVIII OF THE 1996-2001 CBA?

HELD: It is clear from the intent of the provision, based on the fact that the same provision appeared in earlier CBAs that a Dole employee is entitled to a free meal after rendering exactly or no less than, 3 hours of OT and not more than 3 hours of OT.

The petitioner also cannot invoke the principle of management prerogative, that the employer has the power to grant benefits over and beyond the minimum standards of law or the Labor Code. The exercise of this principle is not unlimited. It is subject to the limitations found in law, a collective bargaining agreement or the general principles of fair play and justice. THE CBA IS THE NORM OF CONDUCT BETWEEN THE PETITIONER AND PRIVATE RESPONDENT AND COMPLIANCE THEREWITH IS MANDATED BY EXPRESS POLICY OF THE LAW.

Arco Metal Products Co. vs Samahan 554 SCRA 111 (2008)

FACTS:

December 2003, petitioner paid the 13th month pay, bonus, and leave encashment of three union members in amounts proportional to the service they actually rendered in a year, which is less than a full twelve (12) months.

Respondent protested the prorated scheme, claiming that on several occasions petitioner did not prorate the payment of the same benefits to seven (7) employees who had not served for the full 12 months. The payments were made in 1992, 1993, 1994, 1996, 1999, 2003, and 2004. According to respondent, the prorated payment violates the rule against diminution of benefits under Article 100 of the Labor Code. Thus, they filed a complaint before the National Conciliation and Mediation Board (NCMB).

Petitioner claims that its full payment of benefits regardless of the length of service to the company does not constitute voluntary employer practice. It points out that the payments had been erroneously made and they occurred in isolated cases in the years 1992, 1993, 1994, 1999, 2002 and 2003. According to petitioner, it was only in 2003 that the accounting department discovered the error “when there were already three (3) employees involved with prolonged absences and the error was corrected by implementing the pro-rata payment of benefits pursuant to law and their existing CBA.” It adds that the seven earlier cases of full payment of benefits went unnoticed considering the proportion of one employee concerned (per year) vis à vis the 170 employees of the company. Petitioner describes the situation as a “clear oversight” which should not be taken against it.

The appellate court found that petitioner, however, had an existing voluntary practice of paying the aforesaid benefits in full to its employees, thereby rejecting the claim that petitioner erred in paying full benefits to its seven employees. The appellate court noted that aside from the affidavit of petitioner’s officer, it has not presented any evidence in support of its position that it has no voluntary practice of granting the contested benefits in full and without regard to the service actually rendered within the year. It also questioned why it took petitioner eleven (11) years before it was able to discover the alleged error.

ISSUE: Whether or not the full payment of benefits regardless of the length of service to the company does constitute voluntary employer practice.

HELD: It was held that the full payment of benefits regardless of the length of service to the company constituted voluntary employer practice.

Any benefit and supplement being enjoyed by employees cannot be reduced, diminished, discontinued or eliminated by the employer. The principle of non-diminution of benefits is founded on the Constitutional mandate to "protect the rights of workers and promote their welfare,” and “to afford labor full protection.” Said mandate in turn is the basis of Article 4 of the Labor Code which states that “all doubts in the implementation and interpretation of

this Code, including its implementing rules and regulations shall be rendered in favor of labor.”

In the years 1992, 1993, 1994, 1999, 2002 and 2003, petitioner had adopted a policy of freely, voluntarily and consistently granting full benefits to its employees regardless of the length of service rendered. True, there were only a total of seven employees who benefited from such a practice, but it was an established practice nonetheless. Jurisprudence has not laid down any rule specifying a minimum number of years within which a company practice must be exercised in order to constitute voluntary company practice. Thus, it can be six (6) years, three (3) years, or even as short as two (2) years. Petitioner cannot shirk away from its responsibility by merely claiming that it was a mistake or an error, supported only by an affidavit of its manufacturing group.

If petitioner wants to prove that it merely erred in giving full benefits, it could have easily presented other proofs, such as the names of other employees who did not fully serve for one year and thus were given prorated benefits. This could have easily bolstered petitioner’s theory of mistake/error, but sadly, no evidence to that effect was presented.

Mcleod v. NLRC

FACTS: Mcleod was the acting vice-president and general manager of Peggy Mills Inc. (PMI)

from Jun 1980- Dec.1992 (12 years). When PMI’s employees staged a strike, PMI stopped its operations permanently starting

July 1992. PMI informed its employees including Mcleod of its closure and paid its employees,

including managerial employees, their unpaid wages, sick and vacation leave, prorated 13th month pay and separation pay except Mcleod.

PMI and Mcleod ended their employer-employee relationship in Dec. 1992. PMI assets transferred all its rights, title and interests in the Assets by way of dation in

payment to Sta. Rosa Textiles Inc (STRI). The, SRTI hired Mcleod as consultant and not as employee until Dec. 1993. In Feb. 1995, Mcleod filed a complaint for retirement benefits, vacation and sick leave

benefits, non-payment of unused airline tickets, holiday pay, underpayment of salary and 13th month pay against PMI and SRTI along with the other two companies (FILSYN, FETMI) which use the same address as PMI and SRTI and Patricio Lim (president of PMI).

ISSUE: WON Mcleod is entitled for the payment of vacation and sick leave, holiday pay, underpayment of salary and his 13th month pay, non-payment of unused airline tickets?

RULING: Since Mcleod can’t present evidence like appointment letters or employment contracts,

payrolls, organization charts, SSS registration, personnel list or even testimony of his co-employees to support his allegation of employer-employee relationship between him and any of FILSYN, SRTI, AND FETMI therefore, he can’t have cause of action against these corporations.

Mcleod cause of action is only against his former employer, PMI. On Patricio’s personal liability, there is no evidence that he acted with malice or bad

faith in terminating Mcleod’s services to warrant his personal liability. PMI had no other choice but to stop plant operations because of the serious business losses that it had suffered. The mere fact Patricio was the president PMI is not a ground to conclude that he is solidarily liable with PMI for Mcleod’s money claim.

Mcleod is not entitled to payment of vacation leave and sick leave as well as to holiday pay. As president/plant manager, Mcleod is a managerial employee who is excluded from the coverage of Title I, Book III of the labor code. Mcleod is entitled to payment of vacation and sick leave only if he and PMI had agreed on it. In this case, there is no showing that Mcleod and PMI had an agreement concerning payment of these benefits.

Mcleod’s underpayment of his 13th month pay in Dec. 1993 is unavailing. Mcleod and PMI employer-employee relationship ended in 1992. Since Mcleod was no longer an employee, he was not entitled to the 13th month pay.

Also unavailing is Mcleod’s claim that he was entitled to the non-payment of unused airline tickets for the period covering 1989-1992. PMI has no company policy granting

its officers and employees expenses for trips abroad. PMI never promised Mcleod that it would continue to grant him this benefit.

Regarding the underpayment of salary, Mcleod can’t pretend that his monthly salary of P60,000 was reduced without his consent. It was explained to him that PMI was short in finances that his salary would have reduced. Since the last salary that Mcleod received form PMI was P50,495, this is now the basis in computing his retirement benefits.

Since PMI has no retirement plan, Sec. 5 Rule II of the Rules Implementing the New Retirement Law would apply. With Mcleod having worked with PMI for 12 years, he is entitled to a retirement pay equivalent to ½ month salary for every year of service.

DAVAO FRUITS CORP VS ASSOCIATED 225 SCRA 562 (1993)

FACTS: On December 28, 1982, Associated Labor Unions (ALU), for and in behalf of all the rank and file workers and employees of petitioner Davao Fruits Corp, filed a complaint against the company for non-payment of the 13 th month pay differentials. ALU sought to recover from Davao Fruits Corp the 13th month pay different for 1982 of its rank and file employees, equivalent to their sick, vacation and maternity leaves, premium for work done on rest days and special holidays and pay for regular holidays which the petitioner, allegedly in disregard of company practice since 1975, excluded from the computation of the 13th month pay for 1982.

Davao Fruits Corp claimed that it erroneously included items subject of the complaint in the computation of the 13th month pay for the years prior to 1982 upon a doubtful and difficult question of law. The mistake was only discovered in 1982 after the promulgation of the SC in San Miguel Corp vs Inciong.

ISSUE: W/N IN THE COMPUTATION OF THE 13TH MONTH PAY GIVEN BY EMPLOYERS TO THEIR EMPLOYEES UNDER PD NO. 851, PAYMENTS FOR SICK, VACATION AND MATERNITY LEAVES, PREMIUMS FOR WORK DONE ONE REST DAYS AND SPECIAL HOLIDAYS, AND PAY FOR REGULAR HOLIDAYS MAY BE EXCLUDED IN THE COMPUTATION AND PAYMENT THEREOF, REGARDLESS OF LONG STANDING COMPANY PRACTICE

HELD: The Supplementary Rules and Regulations Implementing PD no. 85, to resolve the issue on the computation of the 13th month pay, expressly stated that the 13th month pay includes only the basic salary. It does not include “fringe benefits.” The same was issued on January 16, 1976, barely a month after the effectivity of PD no. 851. Despite this the petitioner continued its practice in December 1981, after promulgation of the San Miguel decision on February 24, 1981, when it purportedly “discovered” its mistake.

From 1975 to 1981, the petitioner had freely, voluntarily, and continuously included in the computation of its employees’ 13 th month pay, the payments for sick, vacation, and maternity leaves, premiums for work done on rest days and special holidays and pay for regular holidays. This seems to negate its claim of mistake.

A company practice favorable to the employees had indeed been established and the payments made pursuant thereto, ripened into benefits enjoyed by them. Any benefit and supplement being enjoyed by the employees cannot be reduced, diminished, discontinued or eliminated by the employer pursuant to Sec. 10 of the Rules and Regulations Implementing PD no. 851 and Art. 100 Labor Code, which prohibit the diminution or elimination by the employer of the employees’ existing benefits.

Samahang Mangagawa etc. vs NLRC 295 SCRA 171 (1998)

FACTS: Petitioner Samahang Manggagawa sa Top Form Manufacturing United Workers of the

Philippines (SMTFM) was the certified collective bargaining representative of all regular rank and file employees of private respondent Top Form Manufacturing Philippines, Inc. On February 27, 1990, the parties agreed to discuss unresolved economic issues. On the minutes of the meeting, the Union proposed that any future wage increase given by the government should be implemented by the company across-the-board or non-conditional. Management requested the union to retain this provision since their sincerity was already proven when the P25.00 wage increase was granted across-the-board. The union decided to defer this provision, relying on the undertakings made by the officials of the company who negotiated with them and since the company has granted to us government mandated wage increases on across-the-board basis

On October 15, 1990, the RTWPB-NCR issued Wage Order increasing the salary of the workers. The union requested the implementation of said wage orders. However, they demanded that the increase be on an across-the-board basis. Private respondent refused to accede to that demand. Instead, it implemented a scheme of increases purportedly to avoid wage distortion.

The union demanded that it should fulfill its pledge of sincerity to the union by granting an across-the-board wage increases (sic) to all employees under the wage orders. The union reiterated that it had agreed to retain the old provision of CBA on the strength of private respondents promise and assurance of an across-the-board salary increase should the government mandate salary increases.

The union filed a complaint with the NCR NLRC alleging that private respondents act of reneging on its undertaking/promise clearly constitutes an act of unfair labor practice through bargaining in bad faith. It charged private respondent with acts of unfair labor practices or violation of Article 247 of the Labor Code, as amended, specifically bargaining in bad faith, and prayed that it be awarded actual, moral and exemplary damages. The union added that it was charging private respondent with violation of Article 100 of the Labor Code.

Private respondent contends that there was no agreement to the effect that future wage increases mandated by the government should be implemented on an across-the-board basis. Otherwise, that agreement would have been incorporated and expressly stipulated in the CBA.

ISSUE: Whether or not private respondent committed an unfair labor practice in its refusal to grant across-the-board wage increase.

HELD:

No. The private respondent did not commit an unfair labor practice in its refusal to grant across-the-board wage increase.

The alleged violation of Article 100 of the Labor Code, as amended, as well as Article XVII, Section 7 of the existing CBA as herein earlier quoted is likewise found by this Branch to have no basis in fact and in law. No benefits or privileges previously enjoyed by the employees were withdrawn as a result of the implementation of the subject orders. Likewise, the alleged company practice of implementing wage increases declared by the government on an across-the-board basis has not been duly established by the complainants evidence. The complainants asserted that the company implemented Republic Act No. 6727 which granted a wage increase of P25.00 effective July 1, 1989 on an across-the-board basis. Granting that the same is true, such isolated single act that respondents adopted would definitely not ripen into a company practice.

Petitioner union does not deny that discussion on its proposal that all government-mandated salary increases should be on an across-the-board basis was deferred, purportedly because it relied upon the undertaking of the negotiating panel of private respondent. Neither does petitioner union deny the fact that there is no provision of the 1990 CBA containing a stipulation that the company will grant across-the-board to its employees the mandated wage increase. They simply assert that private respondent committed acts of unfair labor practices by virtue of its contractual commitment made during the collective bargaining process. The mere fact, however, that the proposal in question was not included in the CBA indicates that no contractual commitment thereon was ever made by private respondent as no agreement had been arrived at by the parties.

Obviously the purpose of collective bargaining is the reaching of an agreement resulting in a contract binding on the parties; but the failure to reach an agreement after negotiations continued for a reasonable period does not establish a lack of good faith. The statutes invite and contemplate a collective bargaining contract, but they do not compel one. The duty to bargain does not include the obligation to reach an agreement

American Wire and Cable Daily Rated Employees Union v. American Wire and Cable Co. Inc.

FACTS: American Wire and Cable Co., Inc. is a corporation in the manufacture of wires and

cables. There are two union in this company, the Monthly Rated Union and the Daily Rated Union.

In Feb 2001, the two unions filed an action for voluntary arbitration. They alleged that the private respondent withdrew and denied certain benefits and entitlements which they long have enjoyed without valid cause. These are the Service Award; 35% premium pay of an employee’s basic pay for the work rendered during holy Monday, Holy Tuesday, Holy Wednesday, Dec 23, 26, 27, 28, 29; Christmas party; and promotional Increase.

A promotional increase was asked by the petitioner for 15 of its members who were given new job classification. According to the petitioner, the new job classification were in the nature of a promotion.

The voluntary Arbitrator declared that the company is not guilty for withdrawing the service award, X-mas party and 35% premium for work rendered during Holy week and X-mas season and for not granting promotional increase.

The CA affirmed the decision of the voluntary Arbitrator. Hence this petition.

ISSUE: WON private respondent is guilty of violation Art 100 of the Labor Code, as amended, when the benefits/entitlements given to the members of petitioners Union were withdrawn?

RULING: The benefits/entitlements in this case are all bonuses which were given by the private

respondent out of its generosity. The same was a management prerogative, which, whenever management sees necessary, may be withdrawn, unless they have made a part of the wage or salary or compensation of the employees.

For a bonus to be enforceable it must have been promised by the employer and expressly agreed upon by the parties or it must have had a fixed amount and had been a long and regular practice on the part of the employer.

The benefits/entitlements in question were never subjects of any express agreement between the parties. They were never incorporated in the Collective Bargaining Agreement.

The X-mas parties and its incidental benefits, and the giving of case incentive together with the service award cannot be said to have fixed amounts.

It was clear that over the years, there had been a downtrend in the amount given as service award. There was also downtrend with respect to the holding of the X-mas parties in the sense that its location changed fro paid venues to tone which was free of charge, to cut cost. The downtrend in the grant of these two bonuses over the years demonstrated that there is nothing consistent about it.

The additional 35% premium pay for work rendered during the holy week and X-mas season, the holding of X-mas parties with its incidental benefits, and the grant of cash incentive together with the incentive award are all bonuses which are neither demandable nor enforceable obligations of the respondent.

Lastly, since the Union cannot present any proof that a promotion occur with the 15 employees promotional increase cannot be raised.

PAG-ASA STEEL WORKS INC VS CA 486 SCRA 475 (2006)

FACTS: On September 23, 1999, petitioner Pag-asa Steelworks and the Union entered into a collective bargaining agreement (CBA), effective July 1, 1999 until July, 1, 2004. Sec. 1, Art. VI of the said CBA provides that the company agrees to grant all the workers, who are already regular and covered by this agreement at the effectivity of this agreement, a general wage increase as follows:July 1, 1999 - P15.00 per day per employeeJuly 1, 2000 - P25.00 per day per employeeJuly 1, 2001 - P30.00 per day per employee

The difference of the first year adjustment to retroact to July 1, 1999. The across the board wage increase for the 4th and 5th year of the CBA shall be subject for a re-opening or re-negotiation as provided for by RA no. 6715.

On October 14, 1999, Wage Order no. NCR-07 was issued and on October 26, 1999, its implementing rules and regulations. It provided for a P25.50 per day increase in the salary of employees receiving minimum wage and increased the minimum wage to P223.50. Petitioner paid P25.50 per day increase to all of its rank and file employees.

On July 1, 2000, the rank and file employees were granted the second year increase provided in the CBA (P25.00 per day).

On November 1, 2000, Wage Order no. NCR-08 took effect. Sec 1 provides that the private workers and employees in NCR receiving the prescribed daily minimum wage of P223.50 shall receive an increase (P26.50 per day), setting the minimum wage to P250.00 per day.

The Union president requested Pag-asa Steelworks to implement the increase under Wage Order no. NCR-08 in favor of its employees. Petitioner refused, claiming that it was not obliged to grant the wage increase since none of the employees were receiving minimum wage and there was no wage distortion.

The union argued that it had been the company’s practice to grant a wage increase under a government-issued wage order, aside from the yearly wage increase in the CBA. Petitioner alleged that there is no such company practice and that it complied with the previous wage orders (Wage Order nos. NCR-01-05) because some of its employees were receiving wages below the minimum prescribed said orders. As for Wage Order no. NCR-07, petitioner alleged that its compliance was in accordance with its verbal commitment to the Union during the CBA negotiations that it would implement any wage order issued in 1999.

ISSUE: W/N THE PETITIONER IS OBLIGED TO GRANT WAGE INCREASE UNDER WAGE ORDER NO. NCR-08 AS A MATTER OF PRACTICE

HELD: Habits, customs, usage or pattern or of conduct must be proven in court by establishing the degree of specificity and frequency. Mere similarity of contracts does not present the kind of sufficiently similar circumstances to outweigh the danger of prejudice and confusion. The only instance when petitioner admittedly implemented a wage order despite the fact that the employees were not receiving salaries below the minimum wage was under Wage Order no. NCR-07. Petitioner, however, explains that it did so because it was agreed upon in the CBA that should a wage increased be ordered within 6 months from its signing, petitioner would give the increase to the employees in addition to the CBA-mandated increases. Respondent’s isolated act could hardly be classified as a “company practice” or company usage that may be considered an enforceable obligation.

To ripen into a company practice that is demandable as a matter of right, the giving of the increase should not be by reason of a strict legal or contractual obligation but by reason of an act of liberality on the part of the employer. Hence, if the company continuously grants a wage increase as mandated by wage order or pursuant to a CBA, the same would not automatically ripen into a company practice. In this case, Pag-asa Steelworks granted the increase under Wage Order no. NCR-07 on its belief that it was obliged to do so under the CBA.

Suico vs NLRC 513 SCRA 375 (2007)

FACTS: Culver B. Suico, Teresa D. Ceniza, Ronald R. Dacut (complainants were regular

employees of Philippine Long Distance Telephone Company (PLDT) Cebu Jones Exchange and members of Manggagawa ng Komunikasyon ng Pilipinas (MKP).

September 1997, MKP launched a strike against PLDT. Complainants participated in the strike by picketing the PLDT.

PLDT sent 2 notice to explanation to Suico et.al, for the acts of violation that happen during the strike. But the complainant failed to provide the required written explanation the acts charged to them. They replied informing, that they opt to exercise their rights to due process and request to furnish a copy of the formal written complaint complaint filed them, statement of witness/es and preliminary investigations and/or report/s conducted on the aforesaid incident, if any.

PLDT findings based on the available evidence found the complainants guilty and were subsequently terminated

Suico et.al filed a complaint for illegal dismissal and damages. It is the view of PLDT that in the dismissal of employees for strike-related violence, it is

sufficient to merely declare the latter to have lost their employment without having to comply with any procedure for their termination. PLDT, refused to implement said policy, contending that it applies to administrative cases only and not to strike-related cases such as the ones involving Suico, et al.

ISSUE: Whether PLDT violated the requirements of due process under the Labor Code when it dismissed said employees without heeding their request for the conduct of a formal hearing as provided for under PLDT Systems Practice No. 94-016 and prior to submission of their respective answers to the charges against them.

HELD: The procedure adopted by PLDT in dismissing Suico, et al. fell short of the requirements of due process.

The requirements of due process by which to test the validity of the procedure adopted by PLDT in dismissing Suico, et al. are those embodied in Art. 277 (b) of the Labor Code, Rule XXII of the Implementing Rules of Book V and Systems Practice No. 94-016.

PLDT complied with the two-notice requirement of due process. The first notices sent to Suico, et al. set out in detail the nature and circumstances of the violations imputed to them, required them to explain their side and expressly warned them of the possibility of their dismissal should their explanation be found wanting. The last notices informed Suico, et al. of the decision to terminate their employment and cited the evidence upon which the decision was based.68

These two notices would have sufficed had it not been for the existence of Systems Practice No. 94-016. Under Systems Practice No. 94-016, PLDT granted its employee the alternative of either filing a written answer to the charges or requesting for opportunity to be heard and defend himself with the assistance of his counsel or union representative, if he so desires.

Suico, et al. exercised their option under Systems Practice No. 94-016 by requesting that a formal hearing be conducted and that they be given copies of sworn statements and other pertinent documents to enable them to prepare for the hearing. 69 This option is part of their right to due process. PLDT is bound to comply with the Systems Practice.

Company policies or practices are binding on the parties. 60 Some can ripen into an obligation on the part of the employer, 61 such as those which confer benefits on employees 62 or regulate the procedures and requirements for their termination

Art. 277 (b) in relation to Art. 264 (a)55 and (e)56 recognizes the right to due process of all workers, without distinction as to the cause of their termination.57 Where no distinction is given, none is construed.58 Hence, the foregoing standards of due process apply to the termination of employment of Suico, et al. even if the cause therefor was their supposed involvement in strike-related violence prohibited under Art. 264 (a) and (e).

Moreover, the procedure for termination prescribed under Art. 277(b) and Rule XXII of the Implementing Rules of Book V is supplemented by existing company policy. Art. 277(b) provides that the procedure for termination prescribed therein is without prejudice to the adoption by the employer of company policy on the matter, provided this conforms with the guidelines set by the DOLE such as Rule XXII of the Implementing Rules of Book V. This is consistent with the established principle that employers are allowed, under the broad concept of management prerogative, to adopt company policies that regulate all aspects of personnel administration including the dismissal and recall of workers.

CHINA BANKING CORPORATION vs. BORROMEO.

FACTS: Borromeo started joining CBC in 1989 as Manager. From 1992-1995 he was promoted fro three times and received a highly satisfactorily

performance rating. Finally, in 1996, the respondent was promoted to the position of Assistant Vice-

President in Mindanao area However, prior to his last promotion, the respondent, without authority from the

Executive Committee or Board of Directors, approved several DAUD/BP accommodations amounting to P2,441,375 in favor of Maniwan. DAUD/BP is the acronym for checks "Drawn Against Uncollected Deposits/Bills Purchased."

Under the petitioner Bank’s standard operating procedures, DAUD/BP accommodations may be granted only by a bank officer upon express authority from its Executive Committee or Board of Directors and amount is in excess of the credit limit.

When petitioner Bank came to know of the DAUD/BP accommodations in favor of Maniwan, Bank’s First Vice- President and Head-Visayas Mindanao Division, sent a Memorandum to seek clarification with the respondent.

Borromeo, in his letter, accepts full responsibility for committing an error in judgment, lapses in control and abuse of discretion by relying solely on the word, assurance, surety and REM of Mr. Edmund Ramos, a friend and a co-bank officer.

In another Memorandum addressed to the respondent, he was informed that he had violated the petitioner Bank’s Code of Ethics. As such, he was directed to restitute the amount of P1,507,736.79 representing 90% of the total loss of P1,675,263.10 incurred by the petitioner Bank.

However, in view of his resignation and considering the years of service in the petitioner Bank, the management earmarked only P836,637.08 from the respondent’s total separation benefits or pay.

In the another Letter addressed to the respondent, he was again informed that the management would withhold the sum of P836,637.08 from his separation pay, mid-year bonus and profit sharing. The amount withheld represented his proportionate share in the accountability vis-à-vis the DAUD/BP accommodations in favor of Maniwan.

Consequently, the respondent made a demand on the petitioner Bank for the payment of his separation pay and other benefits. The petitioner Bank maintained its position to withhold the sum of P836,637.08.

Hence, this petition.

ISSUE: Whether the respondent pledged his benefits as guarantee for the losses the bank incurred resulting from the unauthorized DAUD/BP accommodations in favor of Maniwan?

RULING: The respondent "is entitled to the benefits he claimed in pursuance to the Collective Bargaining Agreement but, in the meantime, such benefits shall be deposited with the bank by way of pledge.

The petitioner Bank was left with no other recourse but to impose the penalty of restitution. It was certainly within the petitioner Bank’s prerogative to impose on the respondent what it considered the appropriate penalty under the circumstances pursuant to its company rules and regulations.

Indeed, it had been shown that the respondent admitted that he violated the petitioner Bank’s standard operating procedures in granting the DAUD/BP accommodations in favor of Maniwan without higher management approval.

Bank’s Code of Ethics provide that:Restitution/Forfeiture of BenefitsRestitution may be imposed independently or together with any other penalty in case of loss or damage to the property of the Bank, its employees, clients or other parties doing business with the Bank. The Bank may recover the amount involved by means of salary deduction or whatever legal means that will prompt offenders to pay the amount involved. But restitution shall in no way mitigate the penalties attached to the violation or infraction.

Forfeiture of benefits/privileges may also be effected in cases where infractions or violations were incurred in connection with or arising from the application/availment thereof.

Management has the prerogative to discipline its employees and to impose appropriate penalties on erring workers pursuant to company rules and regulations.

Prior to the respondent’s resignation, he was furnished with the Memorandum in which several clarificatory questions were asked to him regarding the DAUD/BP accommodations in favor of Maniwan. It could be said this memorandum constituted notice of the charge against the respondent.

Contrary to his protestations, the respondent was given the opportunity to be heard and considering his admissions, it became unnecessary to hold any formal investigation.

MANEJA VS NLRC 290 SCRA 603 (1998)

FACTS: Petitioner Rosario Maneja worked with private respondent Manila Midtown Hotel beginning January 1985, as a telephone operator. She was a member of the National Union of Workers in Hotels, Restaurants and Allied Industries (NUWHRAIN) with an existing CBA with the private respondent.

In February 13, 1990, a fellow telephone operator, Rowena Loleng, received a request for long distance call (RLDC) form and a deposit for P500.00 from a Japanese guest but the call was unanswered. The deposit was then forwarded to the cashier. The same evening, the Japanese guest again made an RLDC and deposited another P500.00 but the call was also unanswered. Loleng passed the RLDC to Maneja for follow up.

ON February 15, the cashier inquired about the P1000 deposit made. After a search, the first one was found in the guest folio while the other in the folder for cancelled calls. Petitioner Maneja saw that the 2nd RLDC form was not time stamped so she placed it in the machine to stamp it with the date February 15. But after realizing that the call was made 2 days before, she changed the date to February 13.

On March 7, the chief telephone operator asked the petitioner and Loleng to explain the Feb 15 incident. Both submitted their written explanation. On March 20, a written report was submitted, stating that their actions were covered violations of the Offenses Subject to Disciplinary Action (OSDA) as

1. Forging, falsifying official documents and;2. Culpable carelessness—negligence or failure to follow specific instruction/s or

established procedure/sOn March 23, petitioner was then served notice of dismissal effective on April 1. She refused to sign and wrote “under protest.”

On October 2, 1990, Maneja filed a complaint for illegal dismissal against private respondent before the labor arbiter (LA). LA found that the petitioner was illegally dismissed, stating that even though the case revolves on the matter of implementation and interpretation of company policies and is thus within the jurisdiction of the grievance procedure under the CBA, Art. 217 Labor Code confers original and exclusive jurisdiction of all termination cases to LA. NLRC dismissed the case for lack of jurisdiction of LA because the case was subject to voluntary arbitration.

Petitioner insists that her termination is not an unresolved grievance as there had been no grievance meeting between the union and the management. Petitioner alleged that it has been a company policy that termination cases are not referred to the grievance machinery but directly to LA.

ISSUE: W/N THE LABOR ARBITER HAD JURISDICTION TO DECIDE THE CASE

HELD: NLRC’s interpretation of Art 216c Labor Code is erroneous. Even though such provision provides that LA have no jurisdiction over cases arising from interpretation and implementation of CBAs (must be submitted to the grievance machine or voluntary arbitration), it must be read in conjunction with Art 261 which grants voluntary arbitrators original and exclusive jurisdiction to hear and decide all unresolved grievances arising from the interpretation or implementation of the CBA and those arising from the interpretation or enforcement of company personnel policies which is not the case here.

According to the Sanyo case, there is dismissal which does not involve an interpretation or implementation of a CBA or interpretation or enforcement of company personnel policies but involves termination. Where the dispute is just in the interpretation, implementation or enforcement stage, it may be referred to the grievance machinery set up in the CBA or by voluntary arbitration. Where the was already actual termination, i.e. violation of rights, it is already cognizable by LA.

Moreover, Art 260 also stipulates that only disputes involving the union and the company shall be referred to the grievance machinery or voluntary arbitrators. In the case at bar, the union does not event come into the picture as the practice in said Hotel in cases of termination is that they are not referred anymore to the grievance comitte and that the terminated employee who wishes to question the legality of his termination usually goes to LA for arbitration, whether the termination arose from the interpretation or enforcement of the company personnel policies or otherwise.

Petitioner was illegally dismissed as there are two requisites in a valid dismissal: 1. That the dismissal must be for any causes expressed in Art 282 Labor Code and; 2. The employee must be given an opportunity to be heard and to defend himself.

1. There is no cause for dismissal as the petitioner’s actions were not contrary to company practice and there is also no basis for personal appropriation based on the facts

2. An examination of the record reveals that no hearing whatsoever was ever conducted by the Hotel before Maneja was dismissed. While it may be true that the petitioner submitted a written explanation, no hearing was actually conducted before she was terminated. She was not accorded the opportunity to fully defend herself which is clearly a violation of her right to due process.

Amkor Technology vs Juangco 512 SCRA 325 (2007)FACTS:

Due to business losses, petitioner-company company saw the need to reduce its existing manpower complement. Several meetings were held among its officers and department heads to discuss actions to be taken to implement the same.

Sometime in October, 2001, petitioner-company convened its key officers and department heads, including respondent, to finally decide whether to implement a voluntary retirement/voluntary separation program or a retrenchment program. During the meeting, respondent expressed her interest and volunteered to personally participate in the downsizing program of the company’s personnel. To formalize her decision to retire from the company, respondent submitted an undated letter signifying her intention to avail of the Voluntary Retirement Program of the company, effective 15 November 2001.

A week thereafter, or on November 22, 2001, pursuant to her proposition, respondent received her voluntary retirement package in the amount of Three Million Seven Hundred Four Thousand Five Hundred Seventeen Pesos and 98/100 (P3,704,517.98) inclusive of an additional two (2) months pay. Respondent signed a Receipt and Release Waiver and Quitclaim on the same date.

She filed her complaint for illegal dismissal on April 25, 2002, or after almost six (6) months from her separation from petitioner-company. Respondent denied the due execution of her Release Quitclaim and Waiver, alleging that she signed the same under duress and intimidation. She claimed that she was threatened that she will receive nothing if she will not sign it.

Petitioners maintain that respondent’s resignation was voluntary, perforce, there could be no illegal dismissal.

ISSUE: Whether or not respondent voluntarily retired from her position as Executive Director in petitioner-company.

HELD: Respondent was not coerced or intimidated into signing her retirement letter. The voluntariness of her retirement is attested and confirmed by top ranking officials of petitioner- company then present during the meeting in October 2001. She failed to present evidence to contradict their statements.

Respondent received her retrenchment backwage a week after she submitted her resignation paper. She had ample time to mull over what courses of action to take if indeed she was illegally dismissed. Instead, she returned to the company to sign the Receipt and Release Waiver and Quit Claim and to receive her retirement package. Thereafter, she looked for employment in other companies It is thus clear that the filing of the complaint was merely an afterthought when she failed to find another employment

While the Constitution is committed to the policy of social justice and the protection of the working class, it should not be expected that every labor dispute will be automatically decided

in favor of labor. Management also has its own rights which, as such, are entitled to respect and enforcement in the interest of simple fair play

Cebu Royal Plant vs. Deputy Minister of labor

FACTS: Ramon Pilones was employed on probation Feb 16, 1978. The six-month period of probation started on Feb 16 and ended on August 17. After this period, he continued working in the said plant. Pilones underwent medical examination for qualification as regular employee but the results

showed that he is suffering from Pulmonary Tuberculosis (PTB) minimal. Then, he was informed of the termination of his employment by Cebu Royal.

ISSUE: WON Pilones dismissal by Cebu Royal Plant was illegal?

RULING: Pilones dismissal was illegal. Under Art. 282 of the labor Code, “an employee who is allowed to work after probationary

period shall be considered a regular employee.” Hence, Pilones was already on permanent status when he was dismissed on August 21, 1978 or

four days after he ceased to be a probationer. Also the 1977 withholding tax of Pilones is a proof that he was hired earlier than Feb 16, 1978.

Cebu Royal claims that it could not have dismissed Pilones earlier because the x-ray examination was made only on August 17, 1978, and the results were not immediately available. This is untenable.

Cebu Royal had 6 months to conduct such examination but it chose to wait until exactly the last day of the probation period.

Since Pilones was already a regular employee when he was dismissed, he could validly claim the security of tenure guaranteed to him by the constitution and the Labor Code.

Under Sec. 8 Rule I, Book IV, of the rules and Regulations Implementing the labor code the medical certificate should be issued by a competent public health authority.

The medical certificate offered by Cebu Royal came from its own physician, who was not a competent public health authority. The court concluded that the required certificate was not presented because the disease was not so serious that it can be cured within 6 months. If so, dismissal was severe and unlawful sanction.

Additionally, Cebu royal’s application for clearance to terminate the employment of the private respondent was filed with the Ministry of labor seven days after his dismissal. NLRC required not just the mere filing of a petition or the mere attempt to procure a clearance but hat the said clearance be obtained prior to the operative act of termination.

This court agree that there was an attempt to circumvent the law by separating the employee after five months’ service to prevent him from becoming a regular employee, and then rehiring him on probation, again without security of tenure.

Wherefore, Pilones shall be reinstated upon a certification by a competent public health authority that he is fit to return to work.

ENRIQUEZ VS BPI 544 SCRA 590 (2008)

FACTS: Petitioners Enriquez and Sia were senior managers in BPI Bacolod, having served 34 years and 29 years respectively. One day, Descartin, a bank teller, had a shortage of P36,000 and she reported to her managers that it was an honest oversight as she forgot to have her mother-in-law sign a withdrawal slip when the latter withdrew the same amount earlier that day. The managers allowed Descartin to go to her mother-in-law and sign the withdrawal slip. The managers did not report the shortage as it was regularized the same day. Meanwhile, another teller, Fregil, who initially consented to the situation, later divulged that Descartin actually borrowed the P36,000 and the entire incident was covered up by the managers (P36,000 was beyond the floor limit for cashiers). In their defense, the managers said the BPI officer who investigated them was not properly deputized by the board (non-compliance with the NLRC prodecure, Rule 6 Sec 4). Also they assailed their termination arguing that the issue has been regularized on the same day and that there was really no need to report it because of the regularization of the issue and that their long stay with the company should be appreciated with their restatement.

ISSUE: W/N THE PETITIONERS WERE ILLEGALLY DISMISSED AND AS SUCH, SHOULD BE REINSTATED

HELD: The SC held that the procedural issue of the case (that there was no written manifestation of the investigating officer) cannot outweigh substantive right of the company to investigate its employees. It has been ruled that the board, being the representative of the company, can delegate its duties to a person and said person’s act shall be binding to the company as in the case at bar.

The basic requisite for dismissal on the ground of loss of confidence is that the employee concerned holds a position of trust and confidence or is routinely charged with the care or custody of the employer’s money or property, and that the breach must be related to the performance of the employee’s function. The failure of the petitioners to report the cash shortage even if done in good faith, resulted in abetting the dishonesty committed by the teller. Under the personnel policies of the bank, such act justifies their dismissal even on the first offense. Even if we were to assume Enriquez’ version was true, the fact remains that they willfully decided against reporting the shortage that occurred. Their participation in the cover-up of Descartin’s misconduct makes them unworthy of the trust and confidence demanded by their positions.

It is a well-settled that the power to dismiss an employee is a recognized prerogative that is inherent in the employer’s right to freely manage and regulate its business. An employer cannot be expected to retain an employee whose lack of morals, respect and loyalty to his employer or regard for his employer’s rules has so plainly and completely been bared. Thus, to compel BPI to keep petitioners in its employ after the latter betrayed the trust given to thenm would be unjust. The expectation of trust is more so magnified in the present case in light of the nature of the respondent bank’s business. The banking industry is imbued with public interest and is mandated by law to serve its clients with extraordinary care and diligence. To do this, it must rely on the honesty and loyalty of its employees.

Smart Communications vs Astorga 542 scra 153 (2007)

FACTS: Regina M. Astorga (Astorga) was employed by respondent Smart Communications,

Incorporated (SMART) on May 8, 1997 as District Sales Manager of the Corporate Sales Marketing Group/ Fixed Services Division (CSMG/FSD).

As District Sales Manager, Astorga enjoyed additional benefits, namely, annual performance incentive equivalent to 30% of her annual gross salary, a group life and hospitalization insurance coverage, and a car plan in the amount of P455,000.00.5

On May 18, 1998, SMART sent a letter to Astorga demanding that she pay the current market value of the Honda Civic Sedan which was given to her under the company’s car plan program, or to surrender the same to the company for proper disposition.11

Astorga, however, failed and refused to do either, thus prompting SMART to file a suit for replevin with the Regional Trial Court of Makati (RTC) on August 10, 1998.

In February 1998, SMART launched an organizational realignment to achieve more efficient operations. This was made known to the employees on February 27, 1998.6

Part of the reorganization was the outsourcing of the marketing and sales force. Thus, SMART entered into a joint venture agreement with NTT of Japan, and formed SMART-NTT Multimedia, Incorporated (SNMI). Since SNMI was formed to do the sales and marketing work, SMART abolished the CSMG/FSD, Astorga’s division.

SNMI agreed to absorb the CSMG personnel who would be recommended by SMART. SMART then conducted a performance evaluation of CSMG personnel and those who garnered the highest ratings were favorably recommended to SNMI. Astorga landed last in the performance evaluation, thus, she was not recommended by SMART. SMART offered her a supervisory position in the Customer Care Dept but she refused the offer.

On March 3, 1998, SMART issued a memorandum advising Astorga of the termination of her employment on ground of redundancy, effective April 3, 1998. Astorga received it on March 16, 1998.

The termination of her employment prompted Astorga to file a Complaint8 for illegal dismissal, non-payment of salaries and other benefits with prayer for moral and exemplary damages against SMART. She claimed that abolishing CSMG and, consequently, terminating her employment was illegal for it violated her right to security of tenure.

ISSUE:

Whether the dismissal of Astorga be valid or illegal.

Whether or not the RTC has no jurisdiction over the complaint for recovery of a car which Astorga acquired as part of her employee benefit.

HELD: Astorga is declared validly dismissed.

Astorga was terminated due to redundancy, which is one of the authorized causes for the dismissal of an employee. Redundancy in an employer’s personnel force necessarily or even ordinarily refers to duplication of work. 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. An employer is not precluded from adopting a new policy conducive to a more economical and effective management even if it is not experiencing economic reverses. Neither does the law require that the employer should suffer financial losses before he can terminate the services of the employee on the ground of redundancy.

But while tilting the scales of justice in favor of workers, the fundamental law also guarantees the right of the employer to reasonable returns for his investment.38 In this light, we must acknowledge 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.

However, SMART failed to comply with the mandated one (1) month notice prior to termination. The record is clear that Astorga received the notice of termination only on March 16, 199839 or less than a month prior to its effectivity on April 3, 1998. Likewise, the Department of Labor and Employment was notified of the redundancy program only on March 6, 1998.

Article 283 of the Labor Code clearly provides:Art. 283. Closure of establishment and reduction of personnel. — The employer may also terminate the employment of any employee due to the installation of labor saving devices, redundancy, retrenchment to prevent losses or the closing or cessation of operation of the establishment or undertaking unless the closing is for the purpose of circumventing the provisions of this Title, by serving a written notice on the workers and the Ministry of Labor and Employment at least one (1) month before the intended date thereof x x x.

The RTC rightfully assumed jurisdiction over the suit and acted well within its discretion in denying Astorga’s motion to dismisss. SMART’s demand for payment of the market value of the car or, in the alternative, the surrender of the car, is not a labor, but a civil, dispute. It involves the relationship of debtor and creditor rather than employee-employer relations.33 As such, the dispute falls within the jurisdiction of the regular courts.

Replevin is a possessory action, the gist of which is the right of possession in the plaintiff. The primary relief sought therein is the return of the property in specie wrongfully detained by another person. It is an ordinary statutory proceeding to adjudicate rights to the title or possession of personal property. The question of

whether or not a party has the right of possession over the property involved and if so, whether or not the adverse party has wrongfully taken and detained said property as to require its return to plaintiff, is outside the pale of competence of a labor tribunal and beyond the field of specialization of Labor Arbiters.

Pioneer Concrete Philippines, Inc. vs. Todaro

FACTS:

Todaro alleged that Pioneer international Limited (PIL) is engaged in the ready-mix concrete and concrete aggregates business.

While Pioneer Phils. Holdings, Inc. (PPHI) is established by PIL to own and hold the stocks of its operating company in the Philippines

PIoneer Concrete Phils. Inc. (PCPI) is also established by PIL to undertake its business of ready-mix concrete, concrete aggregates and quarrying operations in the Philippines.

McDonald is the Executive of the Hongkong office of PIL. And Klepzig is the President and the Managing director of PPHI and PCPI.

Todaro has been the managing director of a company engaged in pre-mixed concrete and concrete aggregate production

When he resigned in Feb. 1996, PIL contacted Todaro in May 1996 and asked him if he was available to join them in their operations in the Philippines.

PIL and Todaro came to an agreement wherein PIL consented Todaro’s service as a consultant for 2 0r 3 months, after which, he would be employed as the manager of PIL’s ready-mix concrete operations when the company decide to invest in the Philippines.

PIL started its operations in the Philippines; however it refused to comply with its undertaking to employ Todaro on a permanent basis.

Todaro filed with RTC a complaint for a breach of contractual obligation against PCPI. PPHI, PIL, McDonald and Klepzig.

Petitioners moved to dismiss the complaint that the complaint states no cause of action and the RTC has no jurisdiction over the case.

RTC denied the petiititon. Petitioners filed a petition for certiorari with the CA but it was likewise denied.

ISSUE/s:

1.) WON the reneged of petitioners contractual obligation is sufficient to constitute a cause of action for damages?

2.) WON RTC has the jurisdiction over the case?

RULING: Records showed that Klepzig conducted negotiations with Todaro regarding Todaro’s

possible employment. It was also Klepzig who informed respondent that his company was no longer interested in employing respondent. Hence, Todaro has a cause of action.

Also RTC has the jurisdiction over the case. In this case, no employer-employee relationship exists between petitioners and Todaro.

This court held that where no employer-employee relationship exists between the parties and no issue is involved which may be resolved by reference to the Labor Code, other labor statutes or any collective bargaining agreement, it is the RTC that has jurisdiction.

VILLAMARIA VS CA 487 SCRA 571 (2006)

FACTS: Petitioner Oscar Villamaria Jr. was the owner of Villamaria Motors, a sole proprietorship engaged in assembling passenger jeepneys with a public utility franchise to operate along the Baclaran-Sucat route. By 1995, Villamaria stopped assembling jeepneys and retained only nine, four of which operated by employing drivers on a boundary basis. One of those drivers was respondent Bustamante. Bustamante remitted P450/day to Villamaria as boundary and kept residue of his daily earnings as compensation. In August 1997, Villamaria verbally agreed to sell the jeepneys to Bustamante under the “boundary-hulog scheme,” where Bustamante is to remit P550/day to petitioner for a period of 4 years and thereafter ownership will transfer to Bustamante and continue to drive the same under Villamaria’s franchise. It was also agreed that Bustamante will make a down payment of P10,000.

On August 7, 1997, Villamaria executed a contract (Kasunduan ng Bilihan ng Sasakyan sa Pamamagitan ng Boundary-Hulog) over the subject jeepneys with the following stipulations:

1. If Bustamante failed to pay the boundary-hulog for 3 days, Villamaria will hold on to the vehicle until he pays the arrears with penalty of P50/day

2. If he fails to remit the daily boundary-huloy for one week, the agreement will cease to have legal effect and Bustamante will have to return the vehicle to Villamaria motors

Bustamante continued driving the jeepneys under the control and supervision of Villamaria. As agreed upon, he made daily remittances of P550/day in payment of the purchase price of the vehicle. When Bustamante failed to pay the annual registration fees of the vehicle, Villamaria still allowed him to continue driving the jeepneys.

In 1999, Bustamante and other drivers who had the same arrangement with Villamaria Motors failed to pay their respective boundary hulog. As a result, Villamaria sent a notice reminding the drivers that if they fail to remit the boundary-hulog within a week, their respective jeepneys would be returned to him without any complaints. On July 24, 2000, Villamaria took back Bustamante’s jeepneys and barred the latter from driving the vehicle.

Bustamante, then, filed a complaint for illegal dismissal against spouses Villamaria. He alleged that in July 2000, he informed Villamaria that the surplus engine of the jeep needed to be replaced and was assured that it would be done. However, he was later arrested and had his driver’s license confiscated because apparently, the replacement engine installed was taken from stolen vehicle. He was no longer allowed to drive the vehicle unless he paid them P70,000.

Villamaria’s defense: Bustamante was not his employee since their relationship was more of a vendor-vendee given the boundary-hulog scheme

ISSUE: W/N THE EXISTENCE OF A BOUNDARY-HULOG SCHEME NEGATES THE EMPLOYEE-EMPLOYER RELATIONSHIP BETWEEN THE VENDOR AND VENDEE

HELD: Under the boundary-hulog scheme, a dual juridical relationship is created: that of employer-employee and vendor-vendee. The agreement did not extinguish the employer-employee relationship since the boundary system is a scheme whereby an owner/operator engaged in transporting passengers as a common carrier to primarily govern the compensation of the driver, i.e., the latter’s daily earnings are remitted to the owner/operator less the excess of the boundary which represents the driver’s compensation. Under this system, the owner/operator exercises control and supervision over the driver. The management of the business is still in the hands of the owner/operator, who, being the holder of the certificate of public convenience, must see to it that the driver follows the route prescribed by LTRFB. The fact that the driver does not receive fixed wages is not sufficient to change the relationship between them.

The existence of an employment relation is not dependent on how the worker is paid but on the presence or absence of control over the means and method of the work. The employer, then, has the burden of proving the respondent’s termination from employment was for a lawful or just cause which he failed to do in this case.

The jurisdiction of LA and NLRC under Art 217 Labor Code is limited to disputes arising from an employer-employee relationship which can only be resolved by reference to the Labor Code, other labor statutes or their CBA.

Lapanday Agricultural Developtment Corp vs CA 324 SCRA 77 (2001)

FACTS:

In June 1986, plaintiff Commando Security Service Agency, Inc., and defendant Lapanday Agricultural Development Corporation entered into a Guard Service Contract. Commando Security Service Agency Inc. provided security guards to Lapanday Agricultural Development Corp’s banana plantation.

On June 16, 1984, Wage Order No. 5 was promulgated directing an increase of P3.00 per day on the minimum wage of workers in the private sector and a P5.00 increase on the ECOLA. This was followed on November 1, 1984 by Wage Order No. 6 which further increased said minimum wage by P3.00 on the ECOLA.

The Security Agency demanded that its Guard Service Contract with LADC be upgraded in compliance with Wage Order Nos. 5 and 6. Defendant refused. Their Contract expired on June 6, 1986 without the rate adjustment called for Wage Order Nos. 5 and 6 being implemented.

Petitioner asserts that private respondent has no factual and legal basis to collect the benefits under subject Wage Order Nos. 5 and 6 intended for the security guards without the authorization of the security guards concerned. Inasmuch as the services of the forty-two (42) security guards were already terminated at the time the complaint was filed on August 15, 1988, private respondents complaint partakes of the nature of an action for recovery of what was supposedly due the guards under said Wage Orders, amounts that they claim were never paid by private respondent and therefore not collectible by the latter from the petitioner.

Private respondent contends that the basis of its action against petitioner-appellant is the enforcement of the Guard Service Contract entered into by them, which is deemed amended by Section 6 of Wage Order No. 5 and Section 9 of Wage Order No. 6; that pursuant to their amended Guard Service Contract, the increases/adjustments in wages and ECOLA are due to private respondent and not to the security guards who are not parties to the said contract. It is therefore immaterial whether or not private respondent paid its security guards their wages as adjusted by said Wage Orders and that since the forty-two (42) security guards are not parties to the Guard Service Contract, there is no need for them to authorize the filing of, or be joined in

ISSUE: Whether or not there exist an Employer-employee relation between the parties.Whether or not the NLRC has jurisdiction over the said case.Whether or not petitioner is liable to the private respondent for the wage adjustments provided under Wage Order Nos. 5 and 6.

HELD:There’s no existing employer-employee relationship between the parties since the private respondent is an independent/job contractor who assigned security guards at the petitioners premises for a stipulated amount per guard per month. The Contract of Security Services expressly stipulated that the security guards are employees of the Agency and not of the petitioner.

It is seen from Article 106 and 107 that the principal (petitioner) and contractor (private respondent) are jointly and severally liable to the employees for their wages. The joint and several liability of the contractor and the principal is mandated by the Labor Code to assure compliance with the provisions therein including the minimum wage. The contractor is made liable by virtue of his status as direct employer. The principal, on the other hand, is made the indirect employer of the contractors employees to secure payment of their wages should the contractor be unable to pay them. Even in the absence of an employer-employee relationship, the law itself establishes one between the principal and the employees of the agency for a limited purpose i.e. in order to ensure that the employees are paid the wages due them.

It is clear also that it is only when contractor pays the increases mandated that it can claim an adjustment from the principal to cover the increases payable to the security guards. The conclusion that the right of the contractor (as principal debtor) to recover from the principal as solidary co-debtor) arises only if he has paid the amounts for which both of them are jointly and severally liable is in line with Article 1217 of the Civil Code:

“Payment made by one of the solidary debtors extinguishes the obligation. If two or more solidary debtors offer to pay, the creditor may choose which offer to accept.

He who made payment may claim from his codebtors only the share which corresponds to each, with interest for the payment already made. If the payment is made before the debt is due, no interest for the intervening period may be demanded. xxx"

It will be seen that the liability of the petitioner to reimburse the respondent only arises if and when respondent actually pays its employees the increases granted by Wage Order Nos. 5 and 6.

It is well settled in law and jurisprudence that where no employer-employee relationship exists between the parties and no issue is involved which may be resolved by reference to the Labor Code, other labor statutes or any collective bargaining agreement, it is the Regional Trial Court that has jurisdiction. In its complaint, private respondent is not seeking any relief under the Labor Code but seeks payment of a sum of money and damages on account of petitioners alleged breach of its obligation under their Guard Service Contract. The action is within the realm of civil law hence jurisdiction over the case belongs to the regular courts. While the resolution of the issue involves the application of labor laws, reference to the labor code was only for the determination of the solidary liability of the petitioner to the respondent where no employer-employee relation exists. Article 217 of the Labor Code as amended vests upon the labor arbiters exclusive original jurisdiction only over the following:

1. Unfair labor practices;

2. Termination disputes;

3. If accompanied with a claim for reinstatement, those cases that workers may file involving wages, rates of pay, hours of work and other terms and conditions of employment;

4. Claims for actual, moral exemplary and other forms of damages arising from employer-employee relations;

5. Cases arising from any violation of Article 264 of this Code, including questions involving legality of strikes and lockouts; and

6. Except claims for Employees Compensation, Social Security, Medicare and maternity benefits, all other claims, arising from employer-employee relations, including those of persons in domestic or household service, involving an amount exceeding five thousand pesos (P5,000.00) regardless of whether accompanied with a claim for reinstatement.

In all these cases, an employer-employee relationship is an indispensable jurisdictional requisite; and there is none in this case.

Philmare, Inc./Marlow Navigation Co., Ltd. Vs. Suganob

FACTS:

Respondent Suganob was employed as Chief Cook for petitioners for almost 10 years on board with various vessels of petitioners.

His last employment was where he was hired for a period of 10 months starting Sept. 2, 2001.

6 days after he had boarded said ship, he experienced pains on his right shoulder. After undergoing consultation in Vietnam, he was medically repatriated.

Upon arrival in the Phils., Suganob was immediately referred by the petitioners to the People’s diagnostic Center, Inc. where a series of examinations and diagnosis were performed on him.

The medical report showed that Suganob was unfit to work until October 11, 2001 and on October 29, 2011, Suganob was declared fit to work by the People’s Diagnostic Center provided he maintains his medications.

April 5, 2002, Suganob’s physician declared that he cannot be cleared and is not fit to work because of his age and the recurrence of symptoms of illness.

Suganob sought his permanent disability compensation and other benefits from petitioners but his request was refused.

Suganob filed a complaint to recover sickness and permanent disability benefits.

ISSUE:

Is Suganob entitled to disability benefits and sickness allowance/wages?RULING:

The courts find that Suganob is entitled to Grade I disability benefits and sickness which corresponds to total and permanent disability.

The medical certificate issued on October 29, 2001 by petitioner’s company physician stated that Suganob was fit to return work was conditional because Suganob still has to maintain medications.

And the medical certificate issued by the Physician chosen by Suganob on April 5, 2002 indicated that Suganob’s illness recurred and continued which rendered him unfit to continue his work.

In both medical certificates, Suganob was not considered to be fit to return work. Hence, it is clear the Suganob is entitled to disability benefits.

To be entitiled to Grade 1 disability benefits, the employees disability must not only be total but also permanent.

Permanent disability is the inability of a worker to perform his job for more than 120 days, regardless of whether or not he loses the use of any part of his body.

Clearly Suganob’s disability is permanent since he was unable to work from the time he was medically repatriated for more than seven months. Also, if suganob is fit to work, he would have taken back by petitioners. In disability compensation, it is not the injury which is compensated, but rather the incapacity to work resulting in the impairment of one’s earning capacity.

Wherefore, Suganob is to be awarded 120-day sickness benfits and permanent disability benefits.

EDI STAFF BUILDERS INTERNATIONAL INC VS MAGSINO 359 SCRA 212 (2001)

FACTS: EDI is a recruitment agency with Dominguez as its president while Magsino was, until dismissal, its supervisor of Processing and Documentation Group.

The manager of the Processing and Documentation Group sent a memo to Magsino saying that management received reports that Magsino withheld collected premium payments for workers’ mandatory repatriation bond. Magsino, then, was required to explain the alleged incident. Instead of complying with the memo, respondent tendered her resignation but was held in abeyance pending result of the investigation. On May 20, 1993, respondent was given a notice of termination,

ISSUE: W/N NLRC CORRECTLY DISREGARDED THE EVIDENCE PRESENTED ON APPEAL; W/N RESPONDENT WAS DISMISSED FOR CAUSE

HELD: It has been settled that no undue sympathy is to be accorded to any claim of a procedural misstep in labor cases. Such cases must be decided according to justice and equity and substantial merits of the controversy. In the Bristol case, the SC held that the NLRC did not commit grave abuse in considering additional documentary evidence submitted by the employer on appeal to prove breach of trust and loss of confidence as basis for dismissal.

It should be stressed that in an unlawful dismissal case, the employer has the burden of proving the lawful cause for the employee’s dismissal. Without sufficient proof, an employee cannot be dismissed on this ground. As such, it was an error for NLRC and CA to disallow evidence presented on appeal.

Moreover, there is no sufficient proof to establish Magsino was dismissed for loss of trust and confidence. Petitioners simply alleged that the respondent failed to account for P201,600 without showing how this figure was arrived at.

CA was correct to order separation pay instead of reinstatement because of the strain the relationship of the employer and employee and back wages, following the ruling in Bustamante vs. NLRC, should be computed from the time of respondent’s dismissal up to the time of finality of the decision.

Anino vs NLRC 290 SCRA 489 (1998)

FACTS:

Complainants allege that they are employees of respondent Hinatuan Mining Corporation (HMC) holding supervisory positions. Sometime in September 1993, complainants planned the formation of a supervisors union with HMC. The plan was received enthusiastically by practically all employees with supervisory rank, and shortly thereafter the HINATUAN MINING SUPERVISORY UNION (HIMSU) was formally organized and registered with the DOLE. Complainants were elected official and active members of HIMSU.

On or about 03 November 1993, HIMSU formally notified the company of its legal existence through a letter addressed to the President of HMC. . It formally informed the company of its desire for a collective bargaining agreement and submitted its proposals therefore under letter dated 16 November 1993. The complainant claims that that the company completely ignored the union’s proposal and did not answer the HIMSU about it, which constraint the union to file an unfair labor practice case against HMC on May 13, 1994.

In order to weaken and if possible destroy the union, respondents, in the guise of retrenchment, dismissed the complainants who are the active leaders of the union under letter dated 16 June 1994. Complainants aver that their dismissal was done with malicious intent to cause them and the union damage for their legitimate exercise of the right to self-organization, in open defiance of Art. 248 of the Labor Code.

Because of their dismissal, complainants state that they were deprived of their salaries, and suffered moral damages for mental anguish, serious anxiety, social humiliation, besmirched reputation and other similar hurt. Complainants then pray that respondents: (a) be declared guilty of unfair labor practices; (b) be ordered to reinstate complainants to their former positions with backwages.

ISSUE: Whether or not there was a valid retrenchment of the complainants.

HELD: Jurisprudence prescribes the minimum standards necessary to prove the validity of a retrenchment.

Retrenchment is resorted to by an employer because of losses in the operation of a business occasioned by lack of work and considerable reduction in the volume of business. It is a management prerogative consistently recognized and affirmed by this Court, subject only to

faithful compliance with the substantive and procedural requirements laid down by law (article 283) and jurisprudence

To justify retrenchment, the following requisites must be complied with: "(a) the losses expected should be substantial and not merely de minimis in extent; (b) the substantial losses apprehended must be reasonably imminent; (c) the retrenchment must be reasonably necessary and likely to effectively prevent the expected losses; and (d) the alleged losses, if already incurred, and the expected imminent losses sought to be forestalled must be proved by sufficient and convincing evidence."

In termination cases, the burden of proving that the dismissal was for a valid or authorized cause rests upon the employer. In the case at bar, respondent corporation did not submit an iota of evidence to show losses in its business operations and the economic havoc it would sustain imminently. It merely claimed that retrenchment was undertaken as a measure of self-preservation to prevent losses brought about by the continuing decline of nickel prices and export volume in the mining industry.

San Miguel Corporation vs. NLRC

FACTS: Ernesto Ibias was employed by San Miguel corporation (SMC) on Dec. 24, 1978 as a CRO

operator. According to SMC’s Policy, absences without permission or AWOPs, which are absences

not covered either by a certification of the plant doctor that the employee was absent due to sickness or by duly approved application for leave of absence filed at least 6 days prior to the intended leave, are subject to disciplinary action.

On the same Policy, it also punishes falsification of company records or documents with discharge or termination for the first offense if the offender himself benefits from the falsification.

For respondent’s absences in January and April he was given a written warning on May 9, 1997 that he had already incurred 5 AWOPs and that further absences would be subject to disciplinary action.

For his absences in April and May, Ernesto was alleged to have falsified his medical consultation card by stating that he was granted sick leave by the plant clinic on said dates.

Two Notice to Explain letters were sent to Ernesto requiring him to state in writing why he should not be subject to disciplinary action for falsifying his medical consultation card and for not reporting for work in the month of May but Ernesto did not comply with these notices.

June 5, 1997, Ernesto submitted a handwritten explanation to the charges denying the alleged falsification of medical consultation card.

SMC conducted an administrative investigation. During the investigation respondent never admitted that he had sought sick leave permission and also denied falsifying his medical consultation card.

According to the testimonies of the two employees (Siwa and Marable) of SMC, Ernesto falsified his medical consultation card to cover up his excessive AWOPs.

SMC concluded that Ernesto committed the offenses of excessive AWOPs and falsification of company records or documents, and dismissed him.

Ernesto filed a complaint for illegal dismissal against SMC. The labor arbiter found that respondent was never suspended for his previous AWOPs.

It further ruled that the management has to be blamed fro the non-implementation with the company policy.

The CA affirmed the decision of the labor arbiter

ISSUE: WON SMC illegally dismissed Ernesto?

RULING:The court agrees that SMC was unable to prove the falsification charge against respondent. Respondent cannot be legally dismissed on the basis of the testimonies of SMC’s employees. SMC was unable to prove, by substantial evidence, that it was respondent who made the unauthorized entries.

But respondent’s dismissal was well within the purview of SMC’s management prerogative.

SMC gave respondent a warning that he had already 6 AWOPs from the month of January and April. He then again absent on May 7 and 8, 1997. He was also given notices to explain his AWOPs on May 26 and June 2, 1997. As early as June 1997, he had more than 9 AWOPs.

In the implementation of company rules and policies, the employer has the choice to do so strictly or not, since this is inherent its right to control and manage its business effectively.

WE find SMC has acted well within its rights when it dismissed respondent for his numerous absences. Respondent was afforded due process and validly dismissed for cause.

NORKIS TRADING CO INC VS GNILO 544 SCRA 278 (2008)

FACTS: Gnilo was the credit and collection manager of Norkis Trading and is incharge of the Albay and Catanduanes branches of the company. In 2000, Gnilo was found to be submitting overstated reports about his area of management which misled the management into believing that Gnilo was doing a good job. Norkis HR issued a memo that he will be suspended for 15 days without pay and benefits. He was subsequently transferred from his position to being the marketing assistant of the company’s senior VP Albos. Gnilo accepted the position under protest. He sued for illegal suspension and constructive dismissal.

NLRC held that the petitioners validly exercise their management prerogative to impose discipline on an erring employee for negligence but the transfer of position from manager to marketing assistant constitutes constructive dismissal.

Petitioner’s argument: Petitioners claim that they were merely exercising their inherent prerogative as an employer when they appointed respondent as Marketing Assistant to the Senior Vice-President for Marketing.

ISSUE: W/N THE TRANSFER OF GNILO FROM A COLLECTIONS MANAGER TO MARKETING ASSISTANT CONSTITUTES CONSTRUCTIVE DISMISSAL

HELD: The employer has to prove that the transfer is not unreasonable, inconvenient or prejudicial to the employee and does not involve a demotion in rank or diminution of his salaries, privileges and other benefits otherwise, it would constitute constructive dismissal.

Constructive dismissal is defined as a quitting because continued employment is rendered impossible, unreasonable or unlikely; when there is demotion in rank or diminution of pay. Constructive dismissal also exists when an act of clear discrimination, insensibility, or disdain by an employer becomes unbrearable to the employee, leaving him no choice but to leave his employment.

While the transfer of respondent from Credit and Collection Manager to Marketing Assistant did not result in the reduction of his salary, there was a reduction in his duties and responsibilities which amounted to a demotion tantamount to a constructive dismissal.

Punzal vs ETSI Technologies Inc. 518 SCRA 66 (2007)

FACTS:

Petitioner, Lorna Dising Punzal, had been working for ETSI Technologies Inc. as a Department Secretary for 12 years prior to the termination of her services.

Petitioner sent an email to her officemates announcing the holding of Halloween party that was supposed to be held at the office the following day. Upon receiving the email, petitioner’s supervisor, Carmelo Remudaro advised her first secure an approval from the Senior VP, Werner Geisert for the holding of the party in the office. Geisert did not approve of the plan of conducting a party in the office.

Petitioner sent a second email to her officemates informing them of the cancelled Halloween party and including some remarks against the Senior VP ( He was so unfair…para bang palagi siyang iniisahan sa trabaho…bakit most of the parents na mag-joined ang anak ay naka-VL naman. Anyway, solohin na lang niya bukas ang office) and inviting her officemates to attend the Trick or Treat in Megamall during office hours (10am).

Geisert got a copy of her email, thus requiring her to explain in writing within 48hrs why she should not be given a disciplinary action for committing Article IV, No. 5 & 8 Improper conduct or acts of discourtesy or disrespect and Making malicious statements concerning Company Officer, whereby such offenses may be subject to suspension to termination depending upon the gravity of the offense/s as specified in our ETSI’s Code of Conduct and Discipline.

Petitioner replied thru a letter explaining that she had no malicious intention in sending the second email and that she never expected that such kind of words can be called as acts of discourtesy and disrespect.

Geisert and Remudaro subsequently conferred with petitioner to give her a chance to explain her side. Subsequently they sent her a letter finding her explanation unacceptable and terminating her services, effective immediately.

Petitioner filed before NLRC a complaint for illegal dismissal against ETSI, Geisert and Remudaro.

ISSUE: Whether or not the immediate dismissal of the petitioner was reasonable and proper considering the violation she committed.

HELD:

The imposition of the penalty of dismissal is proper:

(1) Punzal’s statements were discourteous and disrespectful not only to a mere co-employee, but to a high ranking executive official of the company;

(2) Punzal’s statements tended to ridicule and undermine the credibility and authority of SVP Geisert, and even encouraged disobedience to the said officer;

(3) Punzal’s message was sent to a great number of employees of ETSI, which tended to sow dissent and disrespect to management among a great number of employees of ETSI;

(4) Punzal’s message could not have been made in good faith, because the message itself used language that placed SVP Geisert in ridicule and portrayed him as an object of scorn, betraying the sender’s bad faith.

Given these circumstances, the fact that Punzal’s infraction occurred only once should be largely insignificant. The gravity and publicity of the offense as well as its adverse impact in the workplace is more than sufficient to place the same in the level of a serious misconduct.

It is the prerogative of management to regulate, according to its discretion and judgment, all aspects of employment. This flows from the established rule that labor law does not authorize the substitution of the judgment of the employer in the conduct of its business. Such management prerogative may be availed of without fear of any liability so long as it is exercised in good faith for the advancement of the employers’ interest and not for the purpose of defeating or circumventing the rights of employees under special laws or valid agreement and are not exercised in a malicious, harsh, oppressive, vindictive or wanton manner or out of malice or spite

Torreda vs. Toshiba Information Equipment (Phils.) Inc.

FACTS: Torreda was employed at Toshiba as finance accountant under the Finance and

Accounting Department headed by Kobayashi, Vice-President and Sepulveda, Finance Manager.

From September 1-3, 1998, Sepulveda received some complaints from separated employees and from incumbent employees on maternity and other benefits.

In order to retrieve the claimants’ payroll and SSS files, which Torreda kept in his drawer, Sepulveda, with prior approval from Kobayashi, had the drawer forcibly opened by a staff member of the General Administration Section. The drawer was opened in the presence of Oscar Eusebio, Noralyn Florencio and Flor Berdin of the Finance Department.

On Sept. 7, 1998 Sepulveda requested Torreda to submit his key for duplication t. Torreda refused.

Sepulveda sent a formal request through e-mail directing him to turn over his drawer key to the General Administrator of the company for the duplication and to explain in writing why he refused to surrender his key.

Torreda replied through e-mail accusing Sepulveda of robbery. Torreda furnished copies of this e-mail to several employees.

On the same day, Sepulveda sent to the HRD a complaint/request for investigation via e-mail regarding Torreda’s accusation and his abusive and rude behavior.

The staff of the General Administration (GA) Section conducted an investigation of the complaint against Sepulveda and submitted his report declaring that there was no factual basis for Torreda’s robbery charge against Sepulveda.

The GA recommended that Torreda be dismissed conformably with its findings that he committed grave slander under the company’s Employee Handbook.

Torreda was dismissed. Torreda filed a complaint for illegal dismissal.

ISSUE: WON the dismissal of the petitioner was legal.

RULING: The dismissal of Torreda was legal.

Respondent Toshiba proved that petitioner was dismissed for just cause.

The false attribution by Torreda of robbery against Sepulveda was made in writing, Torreda committed libel and not grave slander against Sepulveda.

An employee may be dismissed from employment for acts punishable under art. 282 (a) of the Labor Code that is by serious misconduct.

There is abundant evidence on record showing that Torreda committed libel against his immediate superior, Sepulveda, an act constituting serious misconduct which warrants the dismissal from employment.

Torreda knew that it was not Sepulveda who opened his drawer. Petitioner admitted that his charge of robbery against Sepulveda was baseless, but claimed that he fabricated the charge because of his anger at Sepulveda’s repeated acts of opening his drawer without prior permission.

An employer has a free reigns and enjoys wide latitude of discretion to regulate all aspects of employment including the prerogative to instill discipline in its employees and to impose penalties, including dismissal, upon erring employees.

This is a management prerogative, where the free will of management to conduct its own affairs to achieve its purpose takes form.

UNION OF FILIPRO VS NESTLE PHILS 449 SCRA 521 (2007)

FACTS: In anticipation of the expiration of the existing CBA between Nestle and UFE, the presidents of the Alabang andf Cabuyao divisions informed the company of their intent to open negotiations for the upcoming CBA covering 2001-2004. Nestle acknowledged the letter and informed the union that it was preparing its own counterproposal and proposed ground rules that shall govern the conduct of the CBA negotiations.

In May 2001, Nestle sent another letter underscoring subjects which shall be excluded from the CBA negotiations also clarified that since the closure of the Alabang plant, the CBA negotiations will only be applicable to the Cabuyao plant. Incidentally, both parties failed to reach an agreement on the proposed CBA. On November 2001, a notice of strike was filed by the union alleging, among others, Nestlé’s unfair labor practices (i.e. bargaining in bad faith by setting pre-conditions in the ground rules). In view of the impending strike, Nestlé filed with DOLE a petition praying that DOLE sec Sto. Tomas assume jurisdiction over the labor dispute, thereby enjoining any impending strike at the Cabuyao plant. However despite the injunction contained in the assumption of jurisdiction order and conciliation efforts, on January 15, 2002, the employees of the union at the Cabuyao plant went on strike. In light of the strike, DOLE secretary issued another order:

1. Ordering members of the union to return to work within 24 hours 2. Nestle to accept back all returning employees under the same terms and conditions

existing prior to the strike3. To cease and desist from committing acts inimical to the ongoing conciliation meetings4. Both parties to submit position papers within 10 days

Despite this, the members of the union continued with their strike and refused to go back to work as instructed

ISSUE: W/N RESPONDENT NESTLE IS GUILTY OF UNFAIR LABOR PRACTICE IN REFUSING TO PROCEED WITH THE CBA NEGOTIATIONS UNLESS PETITIONER FIRST ADMITS THAT THE RETIREMENT PLAN IN THE COMPANY IS A NON-CBA MATTER

HELD: In an earlier case involving the same parties, the SC held that the inclusion of the retirement plan in the CBA as part of the package of economic benefits extended by the company to its employees has a consensual character to the plan so that it may not be terminated or modified at will by either party. The fact that the retirement plant is non-contributory does not make it a non-issue in the CBA negotiations. Since the retirement plan has been an integral part of the CBA since 1972, the union’s demand to increase the benefits

due the employees under said plan is a valid CBA issue. Pursuant to Art 100 Labor Code, employees do have a vested and demandable right over existing benefits voluntarily granted to them by their employer. As such, the latter may not unilaterally withdraw, eliminate or diminish such benefits.

Employers are accorded rights and privileges to assure their self-determination and independence and reasonable return of capital. This mass of privileges comprises the so-called management prerogatives. In this connection, the rule is that good faith is always presumed. As long as the company’s exercise of the same is in good faith to advance its interest and not for purpose of defeating or circumventing the rights of employees under the law or a valid agreement, such exercise will be upheld.

From the facts and evidence extant in the records of these consolidated petitions, this Court f inds that 1) the Retirement Plan is sti l l a valid issue for herein parties collective bargaining negotiations; 2) the Court of Appeals committed reversible error in l imiting to the issue of the ground rules the scope of the power of the Secretary of Labor to assume jurisdiction over the subject labor dispute; and 3) Nestlé is not guilty of unfair labor practice.

Star Paper Corp vs Simbol 487 SCRA 228 (2006)

FACTS:

Petitioner Star Paper Corporation (the company) is a corporation engaged in trading – principally of paper products. Josephine Ongsitco is its Manager of the Personnel and Administration Department while Sebastian Chua is its Managing Director.

Respondents (Simbol, Comia and Estrella) were all regular employees of the company. The company has a company policy, promulgated in 1995, viz:

1. New applicants will not be allowed to be hired if in case he/she has [a] relative, up to [the] 3rd degree of relationship, already employed by the company.

2. In case of two of our employees (both singles [sic], one male and another female) developed a friendly relationship during the course of their employment and then decided to get married, one of them should resign to preserve the policy stated above.

Simbol and Comia having married one of their co-employees were advised that one of each couples should resign pursuant to the company policy.

Petitoner stated that Estrella who also met one co-worker, Zuniga a married man, got Estrella pregnant. Petitioner alleged that they could have termininated her services due to immorality but instead, she opted to resign.

The respondents Simbol and Comia had a different version claiming that they did not resign voluntarily; they were compelled to resign in view of an illegal company policy. As to Estrella, after getting pregnant and discovering that Zuniga was not separated severed her relationship to him to avoid dismissal due to company policy. She met an accident thus was advised to recuperate and upon returning to work, she was denied entry and was given a Memo stating that she was being dismissed for immoral misconduct.

Respondents filed a complaint for unfair labor practice. They averred that the company policy was illegal and contravenes Article 136 of the Labor Code.

ISSUE:

Whether the policy of the employer banning spouses from working in the same company violates the rights of the employee under the Constitution and the Labor Code or is a valid exercise of management prerogative.

HELD:

The 1987 Constitution states our policy towards the protection of labor under the following provisions: Article II, Section 18, Article XIII, Sec. 3

The Civil Code likewise protects labor with the following provision: Art. 1700 and 1702

The case at bar also involves Article 136 of the Labor Code.

The no-spouse employment policy violate the marital status provision because it arbitrarily discriminates against all spouses of present employees without regard to the actual effect on the individual's qualifications or work performance.

These courts also find the no-spouse employment policy invalid for failure of the employer to present any evidence of business necessity other than the general perception that spouses in the same workplace might adversely affect the business. They hold that the absence of such a bona fide occupational qualification invalidates a rule denying employment to one spouse due to the current employment of the other spouse in the same office. Thus, they rule that unless the employer can prove that the reasonable demands of the business require a distinction based on marital status and there is no better available or acceptable policy which would better accomplish the business purpose, an employer may not discriminate against an employee based on the identity of the employee’s spouse. This is known as the bona fide occupational qualification exception.

There must be a compelling business necessity for which no alternative exist other than the discriminatory practice. To justify a bona fide occupational qualification, the employer must prove two factors: (1) that the employment qualification is reasonably related to the essential operation of the job involved; and, (2) that there is a factual basis for believing that all or substantially all persons meeting the qualification would be unable to properly perform the duties of the job.

We do not find a reasonable business necessity in the case at bar.

Petitioners’ sole contention that "the company did not just want to have two (2) or more of its employees related between the third degree by affinity and/or consanguinity" is lame. That the second paragraph was meant to give teeth to the first paragraph of the questioned rule is evidently not the valid reasonable business necessity required by the law.

Marival Trading, Inc. vs. NLRC

FACTS: Abella worked as ch1emist/quality controller at Marival for almost 8 years. On July 14, 2000, Manuel, Vice-President and General Manager of Marival, conducted a

staff meeting and after the meeting he asked the packaging supervisor and importation manager to stay behind to discuss other matters.

Manuel then requested two male employees to move some tables and placed Abella’s belongings on one of these tables without Abella’s presence.

Abella came in when Manuel and the packaging supervisor and importation manager were already having their own meeting.

While Abella was attending her things, her shoulder bag fell loudly on the floor, disrupting the officer’s meeting.

Manuel approached Abella to ask what the problem was and Abella expressed her anger over the fact that the employees were not informed first before their tables were moved.

Manuel asked Abella to leave the room but she refused to do so. Three days later, Abella received a memo from Manuel directing her to explain within

24 hours why no disciplinary action should be imposed for her disrespectful insubordination and unprofessional conduct.

Abella denied the accusation against her. She clarified that her bag accidentally fell to the floor, that she aired her side regarding the table rearrangement in a tactful and courteous manner and that the order to get her out of the room was unjustified.

Unconvinced by the explanation and finding no justifiable reason for the employee’s outburst, Marival fired Abella on July 21, 2000.

Abella filed a complaint for illegal dismissal with the labor Arbiter alleging that she was dismissed from work without just cause and without due process.

ISSUE/s:1. Whether a valid cause existed to justify Abella’s dismissal?2. Whether the cause of Abella’s dismissal amounts to serious misconduct?

RULING:In order to consider it a serious misconduct that would justify dismissal under the law, it must have been done in relation to the performance of her duties as would show her unfit to continue working for her employer.

The acts of Abella that was complained of did not pertain to her duties as chemist/quality controller.

Abella did not make any false and malicious statements against her superiors. Abella’s act do not constitute serious misconduct as to justify her dismissal.

Affiants failed to cite particular acts or circumstances which would show that Abella was extremely disrespectful to her superior. They just alleged that respondent threw her bag and other things noisily and uttered unpleasant remarks at her employer.

Abella merely uttered, “Sana naman next time na uurungin yung gamit namin, eh sasabihin muna sa amin.” We do not find the remarks unpleasant. The words “SANA NAMAN” SUGGEST THAT SHE WAS MAKING A REQUEST TO HER SUPERIOR FOR A LITTLE MORE CONSIDERATION.

The court reiterates the settled rule that in termination of employment disputes, the burden of proof is always on the employer to prove that the dismissal was for a just and valid cause, which Marival failed to discharge.

This court agrees that the dismissal on Abella for misconduct appears to be too harsh a penalty. It must be noted that Abella is being held liable for a first time offense, despite 8 years of unblemished service. Consideration must still be given to her length of service and the number of violations committed during her employment.

TINIO VS CA 524 SCRA 533 (2007)

FACTS: Smart Communications employed petitioner Tinio as its general manager for VISMIN on December 2002. In May 2003, Caeg, the group head of sales and distribution, informed petitioner of his new assignment as sales manager in the Makati head office. Thereafter, the petitioner did not report for work. He then filed a complaint for constructive dismissal. Caeg required petitioner to explain his continuing refusal to transfer to his new assignment but instead, petitioner referred Caeg to his complaint for constructive dismissal. Caeg also scheduled a hearing on June 23, 2003 but petitioner failed to attend. Thus, private respondents terminated Caeg terminated petitioner’s employment effective June 25, 2003 for insubordination.

ISSUE: W/N PRIVATE RESPONDENT’S (CAEG) ACT OF TRANSFERRING PETITIONER TO ITS MAKATI HEAD OFFICE IS A VALID EXERCISE OF MANAGEMENT PREROGATIVE

HELD: As a rule, the court will not interfere with an employer’s prerogative to regulate all aspects of employment which includes work assignment, working methods, and place and manner of work. This prerogative is based on its assessment and perception of its employees’ qualifications, aptitudes, etc. to move them around in the various areas of its business operations. This privilege inherited in the employer’s right to control and manage his enterprise effectively.

Limits:1. It cannot be used as a subterfuge by the employer to rid himself of an undesirable

worker2. Transfer is not unreasonable, inconvenient or prejudicial to the employee 3. It does not involve a demotion in rank or diminution of his salaries and other benefits

Flight Attendant and Stewards Assoc. of the Phil. vs PAL 559 SCR 252 (2008)

FACTS:

Petitioner FASAP is the duly certified collective bargaining representative of PAL flight attendants and stewards, or collectively known as PAL cabin crew personnel. Respondent PAL is a domestic corporation organized and existing under the laws of the Republic of the Philippines, operating as a common carrier transporting passengers and cargo through aircraft.

On June 15, 1998, PAL retrenched 5,000 of its employees, including more than 1,400 of its cabin crew personnel, to take effect on July 15, 1998. PAL adopted the retrenchment scheme allegedly to cut costs and mitigate huge financial losses as a result of a downturn in the airline industry brought about by the Asian financial crisis.

FASAP and PAL conducted a series of consultations and meetings and explored all possibilities of cushioning the impact of the impending reduction in cabin crew personnel. However, the parties failed to agree on how the scheme would be implemented. Thus PAL unilaterally resolved to utilize the criteria set forth in Section 112 of the PAL-FASAP Collective Bargaining Agreement[8] (CBA) in retrenching cabin crew personnel: that is, that retrenchment shall be based on the individual employee's efficiency rating and seniority.

On July 15, 1998, however, PAL carried out the retrenchment of its more than 1,400 cabin crew personnel.

ISSUE: Whether or not PAL is guilty of illegal dismissal of its employees.

HELD: PAL's retrenchment program is illegal because it was based on wrongful premise (Plan 14, which in reality turned out to be Plan 22, resulting in retrenchment of more cabin attendants than was necessary) and in a set of criteria or rating variables that is unfair and unreasonable when implemented. It failed to take into account each cabin attendant's respective service record, thereby disregarding seniority and loyalty in the evaluation of overall employee performance.

Quitclaims executed as a result of PAL's illegal retrenchment program are likewise annulled and set aside because they were not voluntarily entered into by the retrenched employees; their consent was obtained by fraud or mistake, as volition was clouded by a retrenchment program that was, at its inception, made without basis. The law looks with disfavor upon quitclaims and releases by employees pressured into signing by unscrupulous employers minded to evade legal responsibilities. As a rule, deeds of release or quitclaim cannot bar employees from demanding benefits to which they are legally entitled or from contesting

the legality of their dismissal. The acceptance of those benefits would not amount to estoppel. The amounts already received by the retrenched employees as consideration for signing the quitclaims should, however, be deducted from their respective monetary awards.

Hanjin Heavy Industries and |Construction Co., Ltd. Vs. Ibanez

FACTS: Hanjin is a foreign company engages in the construction business in the Philippines. Respondent Ibanez, Carolino, Gacula, Dagotodot, Calda and four other co-workers

employees of Hanjin.. April 15, 2002, Hanjin dismissed respondents from employment. Petitioner, on the other hand, maintained that respondents were hired as project

employees for the construction of the LRT/MRT Line 2 Package 2 and 3 Project. Petitioner also insists a completion bonus was paid to the respondents. . Petitioner’s also attached copies of the quitclaim, executed by respondents, which

stated that the latter received all wages and benefits that were due them and released Hanjin and its representatives from any claims in connection with their employment.

CA declared respondents that they were regular employees who had been dismissed without just and valid causes without due process.

ISSUE: WON respondents are regular employees?

RULING:Respondents are to be considered regular employees of Hanjin.

A written contract will be the evidence that respondents were informed of the duration and scope of their work and their status as project employees.

In this case, no contract was produced. In the absent of proof that the project employees were informed of their status, it is presume that they are regular employees.

Hanjin argues that the Termination Report filed before the DOLE signifies that respondents’ services were engaged only for the LRT/MRT Line 2. But Hanjin was not able to offer evidence to controvert the respondents’ claim that they were assigned to various construction projects.

Petitioner did not present other Termination Reports. The failure of an employer to file a Termination Report with the Dole every time a project is completed indicates that respondents were not project employees.

Petitioner insists that the payment to the respondents of a completion bonus indicates that respondents were project employees. But petitioner failed to present evidence showing that they undertook to pay respondents such bonus upon the completion of the project.

Finally, the quitclaims which the respondents signed cannot bar them from demanding what is legally due them as regular employee.

Quitclaims and waivers are ineffective to bar claims for the full measure of a worker’s legal rights, particularly when the following conditions are applicable: 1) where there is a clear proof that the waiver was wangled fro an unsuspecting or gullible person; 2) where the terms of settlement are unconscionable on their face.

To determine whether the quitclaims signed by respondent are valid, one important factor that must be taken into account is the consideration accepted by respondents; the amount must constitute a reasonable settlement equivalent to the full measure of their legal rights.

In this case, the quitclaims signed by the respondents do not appear to have been made for valuable consideration. Respondents, who are regular employees, are entitled to backwages and separation pay and the quitclaims which they signed cannot prevent them from seeking claims to which they are entitled.

R.B. MICHAEL PRESS VS GALIT 545 SCRA 23 (2008)

NCC Art. 2028. A compromise is a contract whereby the parties, by making reciprocal concessions, avoid a litigation or put an end to one already commenced. NCC Art. 2036. A compromise comprises only those objects which are definitely stated therein, or which by necessary implication from its terms should be deemed to have been included in the same. A general renunciation of rights is understood to refer only to those that are connected with the dispute which was the subject of the compromise.

FACTS: in May 1997, respondent Galit was employed by R.B. Michael Press as an offset machine operator (P230/day; Monday to Saturday). During his employment, Galit was tardy for a total of 190 times and was absent without leave for 9 ½ days. Sometime in February 1999, respondent was asked to render OT but refused to. The following day (Feb 23), petitioner Escobia told him not to work and to return later in the afternoon for a hearing. A memo (warning for dismissal and notice of hearing) was sent to him stating that he committed the following offenses:1. Habitual and excessive tardiness2. Acts of discourtesy and disrespect in addressing superiors3. Failure to work OT after having been instructed to dos so4. Insubordination

Galit did not show up for the hearing. Feb 24, respondent was terminated from employment and received a termination letter. Subsequently, Galit filed a complaint for illegal dismissal.

ISSUE: W/N THERE WAS JUST CAUSE TO TERMINATE THE EMPLOYMENT OF RESPONDENT GALIT AND W/N DUE PROCESS WAS OBSERVED IN THE DISMISSAL PROCESS

HELD: NLRC and CA were incorrect in holding that petitioner condoned Galit’s habitual tardiness, evidenced by the fact that he was not given any notice/warning. The mere fact that the numerous infractions of respondent have not been immediately subjected to sanctions cannot be interpreted as condonation of the offenses or waiver of the company to enforce company rules. A waiver is a voluntary and intentional relinquishment or abandonment of a known right or privilege. To constitute a valid waiver, it must be couched in clear and unequivocal terms which leave no doubt as to the intention of a party to give up a right or benefit which legally pertains to him. Hence, the management prerogative to discipline employees is a legal right that cannot, as a general right be impliedly waived. In the case at bar, Galit did not adduce any evidence to show waiver or condonation on the part of the petitioners.

For willful disobedience to be a valid cause for dismissal, two elements must be present:

1. The employee’s assailed conduct must have been willful, i.e., characterized by wrongful and perverse attitude

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.

In the present case, it is clear that petitioner’s order for respondent to render OT to meet a production deadline complies with the second requisite. Art 89 Labor Code empowers the employer to legally compel his employees to perform OT against their will to prevent serious loss or damage. The first requisite is also present due to the fact that respondent refused to do OT despite his knowledge that there is a production deadline and without him, no further printing can be made, shows his wrongful and perverse attitude.

The twin notice requirement must be given to an employee before his employment could be terminated:

1. A first notice to apprise the employees of their fault 2. A second notice to communicate to the employees their employment is being

terminatedThe undue haste in effecting respondent’s termination shows that the termination process was a mere simulation—the required notices were given, a hearing was even scheduled and held, but respondent was not really given a real opportunity to defend himself; and it seems that petitioners had already decided to dismiss respondent from service, even before the first notice had been given.

Arellano vs Powertech Corp. 542 SCRA 182 (2008)

FACTS:

A complaint was filed by the Nagkakaisang Manggagawa Ng Powertech Corporation in behalf of its 52 individual members and non-union members against their employer, Powertech for illegal dismissal and other money claims.

The case proceeded with respect to the remaining twenty-five (25) employees, petitioners in this case.

On June 25, 1999, Labor Arbiter Renell Joseph R. Dela Cruz rendered a Decision[3]

declaring illegal the termination of twenty (20) of petitioners and granting their monetary claims in the total amount of P2,538,728.84.

During its pendency, Carlos Gestiada, for himself and on behalf of other petitioners, executed a quitclaim, release and waiver[4] in favor of Powertech in consideration of the amount of P150,000.00. Gestiada was appointed by his co-petitioners as their attorney-in-fact. The appointment was evidenced by a special power of attorney.

On March 15, 2000, Gestiada terminated the services of their counsel, Atty. Evangelista and, instead, retained Atty. Manuel Luis Felipe of the Public Attorney’s Office.

Powertech paid P150,000.00 to Gestiada purportedly as compromise amount for all of petitioners. Gestiada, through Atty. Felipe, and Powertech filed a joint motion to dismiss[10] with the NLRC based on the compromise agreement.

Atty. Evangelista opposed[11] the motion, alleging that the compromise agreement is unconscionable, that he was illegally terminated as counsel for the other petitioners without their consent, and that the P150,000.00 was received by Gestiada as payment solely for his backwages and other monetary claims. On the Joint Motion to Dismiss in their opposition, the other complainants represented by Atty. Evangelista argued that Gestiada received the PhP150,000.00 referred to in the Quitclaim and Release as payment and for his backwages. It is further argued that Gestiada had never intervened in the payment of awards due the other complainants in this case as evidenced by the letter of Gestiada to Atty. Evangelista.

ISSUE: The validity of a quitclaim based on a broad special power of attorney affecting the rights of twenty-two (22) employees.

HELD:The P150,000 was paid to Gestiada solely as payment for his backwages,not those of petitioners; there is evident collusion between Powertech and Gestiada, hence, the compromise agreement is void.Gestiada’s admission that he received the amount of PhP150,000.00 only as payment for his backwages and that the same has no reference to the claim of the other complainants in this

case is bolstered further by the fact that the Quitclaim and Release attached to the instant Joint Motion to Dismiss was signed only by Gestiada and that the other complainants never took part in the execution thereof. A waiver of money claims must be regarded as a personal right; hence, the protective rule that for a compromise dealing with their judgment to be validly entered into there must be personal and specific individual consent given by the workers

The Court gave credence to the admission of Gestiada that he received the P150,000.00 as payment for his own backwages. In his letter to Atty. Evangelista, Gestiada said that he was pressured by Powertech to sign the waiver and quitclaim for petitioners in order to receive his share in the P2.5 million judgment. Having no stable job after his dismissal, Gestiada had no other choice but to breach his fiduciary obligation to petitioners. He succumbed to the pressure of Powertech in signing the waiver, release and quitclaim in exchange for the P150,000.00. In short, he colluded with Powertech to the detriment of petitioners

To Our mind, what prompted Powertech to agree to pay the P150,000.00 was the NLRC order voiding the compromise agreement and reinstating the Labor Arbiter P2.5 million judgment. By then, Powertech was faced with the possibility of paying P2.5 million to petitioners. It was also required by law to post a surety bond for the same amount in order to perfect its appeal with the NLRC.

Armed with the NLRC order, petitioners were bent on pursuing their appeal. Powertech panicked. It negotiated with Gestiada offering him P150,000.00 in exchange for a waiver and quitclaim for himself and for petitioners. Powertech knew that Gestiada was authorized by petitioners to negotiate for “any sum he may deem just and reasonable†� and to sign quitclaims and waivers for them. Jobless and having no regular income, Gestiada succumbed to the pressure. He connived with Powertech and agreed to receive the P150,000.00 for himself in exchange for signing a quitclaim and waiver in the name of petitioners.

To give effect to the collusion, Gestiada had to get rid of Atty. Evangelista, who had previously succeeded in nullifying the compromise agreement. He fired Atty. Evangelista without cause basing his dismissal on his plenary authority as agent of petitioners.

In his letter, Gestiada admitted that the dismissal of Atty. Evangelista was upon the prodding of Virtue Sarmiento, personnel manager of Powertech. Powertech imposed the dismissal of Atty. Evangelista as a condition before Gestiada may receive the amount. A day after firing Atty. Evangelista, Gestiada received the P150,000.00. That same day, Gestiada, represented by Atty. Felipe, and Powertech filed a joint motion to dismiss with the NLRC.

Collusion is a species of fraud. Article 227 of the Labor Code empowers the NLRC to void a compromise agreement for fraud, thus:

Any compromise settlement, including those involving labor standard laws, voluntarily agreed upon by the parties with the assistance of the Bureau or the regional office of the Department of Labor, shall be final and binding upon the parties. The National Labor Relations Commission or any court shall not assume jurisdiction over issues involved therein except in case of non-

compliance thereof or if there is prima facie evidence that the settlement was obtained through fraud, misrepresentation, or coercion.

ANTAMOC GOLDFIELDS MINING COMPANY V CIR

FACTS The National Labor Union, representing the workers of Antamok Goldfield Mining Company, sent a letter to management demanding higher pay and better working conditions.

Management accepted some of their demands and rejected the others.

Consequently the workers went on strike.

The Department of Labor intervened and an amicable settlement between the parties was entered into.

Despite this, another strike was subsequently held.

Then, one of the laborers was stoned from behind which resulted in the dismissal of the forty-five workers.

The matter was heard in the Court of Industrial Relations (CIR) where witnesses for both petitioners and respondents testified.

The CIR ordered one of its special agents to proceed to the premises of the mines and to conduct further investigation.

The investigation disclosed that the unwarranted dismissal of the forty-five men after the incident seems to have been spurred by an anxious desire of the company to get rid of these men.

Among these 45 men are found leaders of the movement of the laborers for higher pay and better working conditions which culminated in the strike called on January 3, 1939.

It was also found out that more than 400 workers of different classes among them, mockers, miners, timbermen, trammers and capataces coming from different mines in the region have been employed by Antamok as fresh laborers and that almost all of these men are not members of the National Labor Union, Inc."

Based on the foregoing, there can be no o

Based on the foregoing, there can be no o

Based on the foregoing, there can be no o

Based on the foregoing, there can be no o

Based on the foregoing, there can be no o

Based on the foregoing, there can be no o

In the order of January 23, 1939 of CIR, the respondent was enjoined to refrain from discharging any laborer involved in the dispute without just cause and without previous authority of the Court.

And in dismissing the 45 workers it violated the said order.

Antamok insists its right of selecting the men to be employed and that in the exercise of this right it should not be restrained or interfered with by the CIR. Consequently, they assail the validity of Commonwealth Act No.103, which created the CIR, on the ground that it deprives them of liberty and property without due process of law.

ISSUE: WON Commonwealth Act No. 103 is unconstitutional

HELD: NO In Commonwealth Act No. 103, our Government no longer performs the role of a mere mediator or intervenor but that of the supreme arbiter.

The policy of laissez faire (a doctrine which prescribes freedom from government interference in economic or industrial affairs) has given way to the assumption by the government of the right of intervention even in contractual relations affected with public interests. Justice Laurel in Ang Tibay, and National Workers Brotherhood v CIR, and National Labor Union, Inc. states that our Constitution was adopted in the midst of surging unrest and dissatisfaction resulting from economic and social distress which was threatening the stability of governments the world over.

Embodying the spirit of the present time, general provisions were inserted in the Constitution which are intended to bring about the needed social and economic equilibrium between component elements of society through the application of what may be termed as the common justice advocated by Grotius and Leibnits many years ago to be secured through the counterbalancing of economic and social forces and opportunities which should be regulated, if not controlled, by the State or placed, as it were, in custodia societatis.

'The promotion of social justice to insure the well-being and economic security of all the people' was thus inserted as vital principle in our Constitution. (Sec. 5, Art. II, Constitution.) The Constitution in various sections has provided the means towards its realization, For instance, section 6 of Article XIII declares that the State 'shall afford protection to labor, especially to working women and minors, and shall regulate the relations between landowner and tenant, and between labor and capital in industry and in agriculture.'

The same section also states that 'the State may provide for compulsory arbitration.' In extraordinary cases mentioned in section 16, Article VI, of the Constitution, the President of the Philippines may be authorized by law, for a limited period and subject to such restrictions as the

National Assembly may prescribe, to 'promulgate rules and regulations to carry out a declared national policy.' Albeit, almost at the same time the Congress of the United States approved the National Labor Regulations Act (49 Stat., 449) on July 5, 1935, commonly known as the Wagner Act, we were in the Philippines headway towards the adoption of our fundamental law, pursuant to congressional authority given in the Tydings-McDuffie Independence Act, approved March 24, 1934. In our Bill of Rights we now find the following provision 'The right to form associations or societies for purposes not contrary to law shall not be abridged.' (Par. 6, section 1, art. III, Constitution.) What was an agitation in the United States which brought about the recommendation by the Commission on Industrial Relations created by an Act of Congress in 1912 for the adoption of a Labor Bill of Rights as an amendment to the United States Constitution is, in our case, virtually an accepted principle, which may be expanded and vitalized by legislation to keep pace with the development of time and circumstances.

By and large, these provisions in our Constitution show and express the need of shifting emphasis to community interest with a view to affirmative enhancement of human values.

In conformity with the constitutional objective and cognizant of the historical fact that industrial and agricultural disputes had given rise to disquietude, bloodshed and revolution in our country, the National Assembly enacted Commonwealth Act No. 103, entitled 'An Act to afford protection of labor by creating a Court of Industrial Relations empowered to fix minimum wages for laborers and maximum rental to be paid by tenants, and to enforce compulsory arbitration between employers or landlords, and employees or tenants, respectively; and by prescribing penalties for the violation of the orders' and, later, Commonwealth Act No. 213, entitled, 'An Act to define and regulate legitimate labor organizations.'

Commonwealth Act No. 213 was enacted in pursuance of what appears to be the deliberate embodiment of a new social policy, founded on the conception of a society integrated not by independent individuals at dealing at arms’ length, but by interdependent members of a consolidated whole whose interests must be protected against mutual aggression and warfare among and between divers and diverse units which are impelled by countervailing and opposite individual and group interests, and this is particularly true in the relationship between labor and capital. Social and industrial disturbances which fifty years ago were feudal-like and of isolated importance may now well result in a serious strain upon the entire economic organism of the nation. Several attempts at meeting and solving our peculiar social and economic problems have already been made.

The system of voluntary arbitration devised by Act No. 4055 of the defunct Philippine Legislature has apparently been abandoned by the enactment of the aforementioned Commonwealth Acts Nos. 103 and 213.

PCL SHIPPING PHILS INC VS NLRC 511 SCRA 44 (2007)

FACTS: On November 1993, respondent Felicisimo Carilla was hired by petitioner, a manning agent, on behalf of its principal, Anglo-Eastern Shipmanagement to work as master on board MV Handy-Cam Azobe for one year. The contract provided that respondent would receive a monthly basic pay of $1,700, fixed OT $765, master’s allowance $170 and leave with pay of 6 days per month or $340 (total $2,975).

However, while the vessel where respondent was on board was docked in Bombay, India, Carilla was dismissed and repatriated to the Philippines. He then filed a case with POEA for illegal dismissal with claims for salaries and other benefits for the unexpired portion of his contract as well as unremitted allotment and damages. Carilla alleged that he was dismissed without notice and notice, and without any valid reason. As such, petitioner deprived him of his expected monthly benefits for the unexpired portion of his contract totaling $16,660 ($2,975 x 5 months and 18 days), petitioner withheld his allotment for the entire May 1994 as well as his accrued leave pay.

Petitioner PCL Shipping, on the other hand, contended that Carilla’s termination as lawful as he had failed to take the necessary steps to ensure the safety of the vessel and its cargo while in South Korea and Keelung port causing petitioner to incur huge amount of damages on cargo claims and vessel repairs. Despite the fact that he was warmed of his lapses, Carilla had not shown any improvement which forced the company to dismiss the respondent.

LA held in favor of respondent Carilla and declared his termination illegal, citing that the recommendations of his previous employers contradicted the allegations against Carilla of being incompetent and that the petitioner’s evidence were unauthenticated, unreliable and self-serving.

ISSUE: W/N PRIVATE RESPODENT CARILLA WAS ILLEGALLY DISMISSED

HELD: In termination cases, the burden of proof rests upon the employer to show that the dismissal of the employee is for just cause and failure to do so would mean that the dismissal was not justified. A dismissed employee is not required to prove his

innocence of the charges leveled against him by his employer. The determination of the existence and sufficiency of a just cause must be exercised with fairness and in good faith and after observing due process.

It is well settled in this jurisdiction that confidential and managerial employees cannot be arbitrarily dismissed at any time, without cause as reasonably established in an appropriate investigation. Such employees, too, are entitled to the security of tenure, fair standards of employment and the protection of labor laws. Managerial employees, no less than rank and file laborers, are entitled to due process. The captain of a vessel is a confidential and managerial employee within the meaning of this doctrine. Thus, the respondent was illegally dismissed as he was not accorded fair investigation required by law and the ground invoked for his dismissal was not proven.

In cases regarding contract workers who were dismissed without just cause which arose before the effectivity of RA 8042, it is settled that if the contract is for a fixed term and the employee is dismissed without just cause, he is entitled to the payment of his salaries corresponding to the unexpired portion of his contract. In the case at bar, Carilla’s contract was until November 18, 1994 but he was dismissed and repatriated to the Philippines on June 6, 1994; thus he is entitled to be paid his salary corresponding to the unexpired portion of his contract.

Phil. Airlines Inc. vs Santos 218 SCRA 415 (1993)

FACTS:

Individual respondents are all Port Stewards and Catering Sub-department, Passenger Services Department of PAL responsible for preparing meal orders and checklists, setting up standard equipment in accordance with the requirements of the type of service for each flight; skiing, binning, and inventorying of Commissary supplies and equipment

Several deductions were made from their salary; the deductions represented losses of inventoried items charged to them for mishandling of company properties.

On August 21, 1984, respondent made a formal notice regarding the deductions to petitioner thru Mr. Reynaldo Abad (Manager for Catering). Since no action was taken, they filed a formal grievance on Nov. 4 1984 pursuant to the grievance machinery Step 1 of the CBA. The union wanted to discuss the illegal/questionable salary deductions and inventory of bonded goods and merchandise being done by catering service personnel which they believe should not be their duty.

The grievance was submitted on Nov. 21, 1984 to the office of Mr. Reynaldo Abad, who was on vacation leave at that time.

Mr. Abad failed to act within the 5-day deadline stated in the CBA; as such the respondent believing in good faith that said grievance was resolved in their favor.

Upon Mr. Abad’s return on Dec. 7 1984, he immediately informed the grievant and scheduled a meeting on Dec. 12, 1984. The respondent refused to conduct inventory works in Dec 7, 10 and 12.

In the meeting Mr. Abad denied the petition of the respondents and adopted the position that the inventory of bonded goods is part of their duty as catering service personnel and rationalized the salary deduction for losses due to mishandling of company property.

Mr. Abad wrote a Memorandum addressed to the individual respondent for them to explain why no disciplinary action should be taken against them for not conducting inventory. The respondent complied with the directives explaining, “Since the grievance step 1 was not decided and no action was done by your office within 5 days from November 21, 1984, per provision of the PAL-PALEA CBA, Art. IV, Sec. 2, the grievance is deemed resolved in PALEA's favor.”

Mr. Abad found the explanation unsatisfactory, thus, a penalty of suspension ranging from 7days to 30 days was imposed depending on the number of infractions committed.

Respondent filed a complaint before the Labor Arbiter for illegal suspension. Labor Arbiter dismissed the complaint, thus respondent appealed the decision before the NLRC which set aside the Labor Arbiters’ order of dismissal.

ISSUE: Whether or not the illegal dismissal was valid.

HELD: It is a fact that the sympathy of the Court is on the side of the laboring classes, not only because the Constitution imposes such sympathy, but because of the one-sided relation between labor and capital. The constitutional mandate for the promotion of labor is as explicit as it is demanding. The purpose is to place the workingman on an equal plane with management — with all its power and influence — in negotiating for the advancement of his interests and the defense of his rights. Under the policy of social justice, the law bends over backward to accommodate the interests of the working class on the humane justification that those with less privilege in life should have more privileges in law.

The respondent knew that the division head, Reynaldo Abad was then “on leave” when they filed their grievance but this knowledge should not prevent the application of the CBA.

The grievance of employees is not a matter which requires the personal act of Mr. Abad and thus could not be delegated. Petitioner could at least have assigned an officer-in-charge to look into the grievance and possibly make his recommendation to Mr. Abad. It is of no moment that Mr. Abad immediately looked into the grievance upon returning to work, for it must be remembered that the grievant are workingmen who suffered salary deductions and who rely so much on their meager income for their daily subsistence and survival. Besides, it is noteworthy that when these employees first presented their complaint on August 21, 1984, petitioner failed to act on it. It was only after a formal grievance was filed and after Mr. Abad returned to work on December 7, 1984 that petitioner decided to turn an ear to their plaints.

Abad's failure to act on the matter may have been due to petitioner's inadvertence, but it is clearly too much of an injustice if the employees be made to bear the dire effects thereof. Much as the latter were willing to discuss their grievance with their employer, the latter closed the door to this possibility by not assigning someone else to look into the matter during Abad's absence. Thus, private respondents should not be faulted for believing that the effects of the CBA in their favor had already stepped into the controversy.

LOPEZ vs. METROPOLITAN WATERWORKS AND SEWERAGE SYSTEM

FACTS: By virtue of an Agreement, petitioners were engaged by the MWSS as collectors-

contractors, wherein the former agreed to collect from the concessionaires of MWSS, charges, fees, assessments of rents for water, sewer and/or plumbing services which the MWSS bills from time to time.

In 1997, MWSS entered into a Concession Agreement with Manila Water Service wherein the collection of bills was transferred to said private concessionaires, effectively terminating the contracts of service between petitioners and MWSS.

Regular employees of the MWSS were paid their retirement benefits, but not petitioners.

MWSS relied on a resolution of the Civil Service Commission (CSC) that contract-collectors of the MWSS are not its employees and therefore not entitled to the benefits due regular government employees.

Petitioners filed a complaint with the CSC. CSC denied their claims, stating that petitioners were engaged by MWSS through a contract of service, which explicitly provides that a bill collector-contractor is not an MWSS employee.

Relying on Part V of CSC Memorandum Circular No. 38, Series of 1993, the CSC stated that contract services/job orders are not considered government services, which do not have to be submitted to the CSC for approval, unlike contractual and plantilla appointments.

Petitioners invoke the rule of liberal construction in favor of labor, and the constitutional policy of protection to labor.

To further strengthen their case, petitioners refer to CSC Resolution 92-2008 dated 8 December 1992, which states in part:. . . . The fact that they were being hired directly and paid on commission basis by MWSS itself is indicative that they are government employees and should be entitled to the incentive awards.

ISSUE: WON petitioners were employees of the MWSS and entitled to the benefits they claim?

HELD: We find for the petitioners.

The Court has invariably affirmed that it will not hesitate to tilt the scales of justice to the labor class for no less than the Constitution dictates that "the State . . . shall protect the rights of

workers and promote their welfare." It is committed to this policy and has always been quick to rise to defense in the rights of labor, as in this case.

Protection to labor, it has been said, extends to all of labor¾local and overseas, organized and unorganized, in the public and private sectors. Besides, there is no reason not to apply this principle in favor of workers in the government. The government, including government-owned and controlled corporations, as employers, should set the example in upholding the rights and interests of the working class.The MWSS is a government owned and controlled corporation with its own charter, Republic Act No. 6234. As such, it is covered by the civil service and falls under the jurisdiction of the Civil Service Commission. CSC Memorandum Circular No. 38, Series of 1993, categorically made the distinction between contract of services/job orders and contractual and plantilla appointment, declaring that services rendered under contracts of services and job orders are non-government services which do not have to be submitted to the CSC for approval.

This was followed by CSC Memorandum Circular No. 4, Series of 1994, which allowed the crediting of services for purposes of retirement only for such services supported by duly approved appointments.

Subsequently, the CSC issued other resolutions applying the above-mentioned circulars, stating that while some functions may have been contracted out by a government agency, the persons contracted are not entitled to the benefits due to regular government employees.

The case reveals that petitioners are employees of MWSS.

MWSS wielded its power of selection when it contracted with the individual petitioners, undertaking separate contracts or agreements.

Under the Agreement, MWSS may terminate it if the "Collector-Contractor"1. Obviously, failure to collect the payments of customers or remit the collections constitutes neglect of duty. 2. Making erasures, alterations or changing of figures in the fees or collection receipts amounts to fraud. 3. Lack of courtesy, dishonesty and arrogance are practically the same as misconduct.

Significantly, MWSS granted petitioners benefits usually given to employees , to wit: COLA, meal, emergency, and traveling allowances, hazard pay, cash gift, and other bonuses.

Petitioners rendered services to MWSS for which they were paid and given similar benefits due the other employees of MWSS.

While petitioners were contract-collectors of MWSS, they were under the latter’s direction as to where and how to perform their collection and were even subject to disciplinary measures.

Trainings were in fact conducted to ensure that petitioners are conversant of the procedures of the MWSS.

Contrary to MWSS’ assertion that petitioners were "free to adopt (their) own method/strategy in the matter of collection", the Agreement clearly provided that the procedure and/or manner of the collection of bills to be followed shall be in accordance with the provisions of the Manual of Procedures.

The power to transfer or reassign employees is a management prerogative exclusively enjoyed by employers. In this case, MWSS had free reign over the transfer of bill collectors from one branch to another. MWSS also monitored the performance of the petitioners and determined their efficiency ratings.

Interestingly in that regard, under the Agreement petitioners were "allowed" to render overtime work, and were given additional "incentive commission" for work so rendered as long as the same was authorized.

MWSS provides them with company stationeries, office space and equipment. Likewise, MWSS comported itself as the employer of petitioners, providing them with I.D.s. and certifications which declared them as employees of MWSS. It also deducted and remitted petitioners’ withholding taxes and Medicare contributions.

The CSC, as well as the Court of Appeals, makes much of CSC Memorandum Circular No. 38, Series of 1993, which distinguishes between contract of services/job services and contractual appointment.

The Circular provides:

Contract of Services and Job Orders are different from Contractual appointment and Plantilla appointment of casual employees, respectively, which are required to be submitted to CSC for approval.

Contracts of Services and Job Orders refer to employment described as follows:1. The contract covers lump sum work or services such as janitorial, security or consultancy services where no employer-employee relationship exist;2. The job order covers piece of work or intermittent job of short duration not exceeding six months on a daily basis;3. The contract of services and job orders are not covered by Civil Service Law, Rules and Regulations; [sic] but covered by COA rules;4. The employees involved in the contracts or job orders do not enjoy the benefits enjoined by government employees, such as PERA, COLA and RATA.

5. As the services rendered under contracts of services and job orders are not considered government services, they do not have to be submitted to the Civil Service Commission for approval.

A careful review of the above-quoted circular shows that the relationship defined by the Agreement cannot fall within the purview of contract of services or job orders.

Viewed in that context the work rendered by the petitioners is essential to the company’s survival and growth. MWSS relies for the most part on the bill collections in order to sustain its operations. It is not intermittent and seasonal, but rather continuous and increasing by reason of its indisputable essentiality.

As clearly indicated in the circular, employees involved in the contracts or job orders do not enjoy the benefits enjoyed by the petitioners which are the same benefits given to government employees.

Some of the petitioners had rendered more than two decades of service to the MWSS. The continuous and repeated rehiring of these bill collectors indicate the necessity and desirability of their services, as well as the importance of the role of bill collectors in the MWSS.

We agree with the CSC when it stated that the authority of government agencies to contract services is an authority recognized under civil service rules.

However, said authority cannot be used to circumvent the laws and deprive employees of such agencies from receiving what is due them.

ENRIQUEZ VS BPI 544 SCRA 590 (2008)

FACTS: Petitioners Enriquez and Sia were senior managers in BPI Bacolod, having served 34 years and 29 years respectively. One day, Descartin, a bank teller, had a shortage of P36,000 and she reported to her managers that it was an honest oversight as she forgot to have her mother-in-law sign a withdrawal slip when the latter withdrew the same amount earlier that day. The managers allowed Descartin to go to her mother-in-law and sign the withdrawal slip. The managers did not report the shortage as it was regularized the same day. Meanwhile, another teller, Fregil, who initially consented to the situation, later divulged that Descartin actually borrowed the P36,000 and the entire incident was covered up by the managers (P36,000 was beyond the floor limit for cashiers). In their defense, the managers said the BPI officer who investigated them was not properly deputized by the board (non-compliance with the NLRC prodecure, Rule 6 Sec 4). Also they assailed their termination arguing that the issue has been regularized on the same day and that there was really no need to report it because of the regularization of the issue and that their long stay with the company should be appreciated with their restatement.

ISSUE: W/N THE PETITIONERS WERE ILLEGALLY DISMISSED AND AS SUCH, SHOULD BE REINSTATED

HELD: The SC held that the procedural issue of the case (that there was no written manifestation of the investigating officer) cannot outweigh substantive right of the company to investigate its employees. It has been ruled that the board, being the representative of the company, can delegate its duties to a person and said person’s act shall be binding to the company as in the case at bar.

Technicalities should never be used to defeat the substantive rights of the other party. Every party-litigant must be afforded the amplest opportunity for the proper and just determination of his cause, free from the constraints of technicalities. Considering that there was substantial compliance, a liberal interpretation of procedural rules in this labor case is more in keeping with the constitutional mandate to secure social justice.

The basic requisite for dismissal on the ground of loss of confidence is that the employee concerned holds a position of trust and confidence or is routinely charged with the care or custody of the employer’s money or property, and that the breach must be related to the performance of the employee’s function. The failure of the petitioners to report the cash shortage even if done in good faith, resulted in abetting the dishonesty committed by the teller. Under the personnel policies of the bank, such act

justifies their dismissal even on the first offense. Even if we were to assume Enriquez’ version was true, the fact remains that they willfully decided against reporting the shortage that occurred. Their participation in the cover-up of Descartin’s misconduct makes them unworthy of the trust and confidence demanded by their positions.

It is a well-settled that the power to dismiss an employee is a recognized prerogative that is inherent in the employer’s right to freely manage and regulate its business. An employer cannot be expected to retain an employee whose lack of morals, respect and loyalty to his employer or regard for his employer’s rules has so plainly and completely been bared. Thus, to compel BPI to keep petitioners in its employ after the latter betrayed the trust given to thenm would be unjust. The expectation of trust is more so magnified in the present case in light of the nature of the respondent bank’s business. The banking industry is imbued with public interest and is mandated by law to serve its clients with extraordinary care and diligence. To do this, it must rely on the honesty and loyalty of its employees.

Definition of Social Justice: While the Constitution is committed to the policy of social justice and the protection of the working class, it should not be supposed that every labor dispute will be automatically decided in favor of labor. Management also has its own rights which, as such, are entitled to respect and enforcement in the interest of simple fair play. Out its concern for those with less privileges in life, this Court has inclined more often than not toward the worker and upheld his cause in his conflicts with the employer. Such favoritism however, has not blinded us to the rule that justice is in every case of the deserving, to be dispensed in the light of the established facts and the applicable law and doctrine.

PLDT vs. Bolso 530 SCRA 550 (2007)

FACTS:

Bolso was an Installer/Repairman II of PLDT since February 1982 until PLDT dismissed him on 20 July 1997.

On 5 February 1996, Samuel Mabunga (Mabunga), a PLDT subscriber, sold the rights to his telephone line to Ismael Salazar (Salazar) for P20, 000. Mabunga received P15000 for the transfer. For the installation of this telephone line, Salazar paid P2,500 to a PLDT installer who introduced himself as Boy Negro and the remaining P2,500 to Boy Negro’s two companions.

On 20 May 1996, Salazar wrote PLDT complaining about Mabunga’s continued usage of the telephone line through extension despite the transfer.

On 28 June 1996, Salazar went to PLDT’s Quality Control and Inspection Division (QCID) office where he affirmed paying P2500 to Boy Negro and another P2500 to Boy Negro’s companion for the installation of the telephone line. During the investigation, Salazar positively identified a photograph of Bolso as that of Boy Negro.

On 29 June 1996, the QCID personnel inspected the telephone line installation at Salazar’s residence and confirmed that Mabunga was using the telephone line using an outside extension installed at Salazar’s house PLDT informed Salazar and Mabunga that it was an unofficial installation.

On 23 July 1996, PLDT issued an Inter-office Memo, requesting the appearance of Bolso, together with his immediate Supervisoror or Union Representative for the investigation of his alleged participation in the illegal installation

On 26 July 1996, Salazar and Bolso appeared at the QCID investigation; Salazar reaffirmed his statement and positively picked out and identified Bolso as the installer of the unofficial telephone line. Bolso denied the allegations against him

Bolso, submitted to PLDT a recantation of Salazar’s previous statements, alleging that he did not personally know Bolso and that Bolso was not Boy Negro.

On 10 July, 1997, Bolso’s counsel demanded the immediate dismissal of the administrative case against Bolso’s based on Salazar’s retraction and the release of Bolso’s benefits under PLDT’s early retirement program.

Giving no credence to the recantation letter and finding that Salazar’s previous statements establish Bolso’s culpability, PLDT terminated Bolso effective June 20, 1997 for serious misconduct.

Bolso filed a with the Labor Arbiter a complaint against PLDT for illegal dismissal, backwages and damage.

Labor Arbiter dismissed the case for lack of merit. Thus, Bolso appealed to NLRC and ruled in favor of Bolso.

ISSUE: Whether or not Bolso’s dismissal for serious misconduct was lawful.

HELD:

The Labor Code provides that an employer may terminate the services of an employee for a just cause. Among the just causes in the Labor Code is Article 282 of LC provides 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.

An employee’s dismissal due to serious misconduct must be supported by substantial evidence. Substantial evidence is that amount of relevant evidence as a reasonable mind might accept as adequate to support a conclusion, even if other minds, equally reasonable, might conceivably opine otherwise.

In this case, there is no question that PLDT installers, such as Bolso, repairmen, and linemen provide services but cannot collect or receive any personal fees for such services. Violating this company rule constitutes serious misconduct.

A retraction does not necessarily negate an earlier declaration. For this reason, courts look with disfavor upon retractions. Hence, when confronted with a recanting witness, in this case the complainant, courts must not automatically exclude the original statement based solely on the recantation. Courts should determine which statement should be given credence through a comparison of the original and the new statements, applying the general rules of evidence

Salazar did not expressly repudiate his earlier statement that he paid Bolso P2,500 for the installation of the illegal telephone line. What Salazar stated in his recantation letter was that Bolso was not Boy Negro. Therefore, only Bolso’s identity as Boy Negro was retracted. Salazar’s original statement that Bolso received P2,500 for the installation of the outside extension line remains undisputed.

The Court has held that 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. An employee’s length of service with the company even aggravates his offense. Bolso should have been more loyal to PLDT from which he had derived his income for 15 years.

Upholding the employee’s interest in disregard of the employer’s right to dismiss and discipline does not serve the cause of social justice. Social justice ceases to be an effective instrument for the “equalization of the social and economic forces” by the State when it is used to shield wrongdoing.

CALALANG V WILLIAMS

FACTS: The Secretary of Public Works and Communications (PWC) approved with modification the recommendation that originated from the National Traffic Commission (NTC), which was favorably indorsed by the Director of Public Works (PW)

that Rosario Street and Rizal Avenue be closed to traffic of animal-drawn vehicles, between the points and during the hours from 7 a.m. to 11 p.m., for a period of one year from the date of the opening of the Colgante Bridge to traffic;

that the Mayor of Manila and the Acting Chief of Police of Manila have enforced and caused to be enforced the rules and regulations thus adopted;

that as a consequence of such enforcement, all animal drawn vehicles are not allowed to pass and pick up passengers in the places abovementioned to the detriment not only of their owners but of the riding public as well.

Commonwealth Act No. 548 gives the Director of Public Works the authority to promulgate rules and regulations to regulate and control the use of and traffic on national roads.

Maximo Calang, in his capacity as private citizen and as a taxpayer of Manila, filed a petition for a writ of prohibition against the Chairman of NTC, Director of PW, Acting Secretary of PWC, Mayor of Manila and Acting Chielf of Police of Manila.

ISSUE: WON the rules and regulations complained of infringe the constitutional precept regarding the promotion of social justice to insure the well-being of all the people?

HELD: No. Social justice is promoted if the greatest good is brought about to the greatest number.

Social justice must be founded on the recognition of the necessity of interdependence among divers and diverse units of a society and of the protection that should be equally and evenly extended to all groups as a combined force in our social and economic life, consistent with the fundamental and paramount objective of the state of promoting the health, comfort, and quiet of all persons, and of bringing about “the greatest good to the greatest number.”

Commonwealth Act No. 548 was passed by the National Assembly in the exercise of the paramount police power of the state. Said Act, by virtue of which the rules and regulations complained of were promulgated, aims to promote safe transit upon and avoid obstructions on national roads, in the interest and

convenience of the public. In enacting said law, therefore, the National Assembly was prompted by considerations of public convenience and welfare.

Persons and property may be subjected to all kinds of restraints and burdens, in order to secure the general comfort, health, and prosperity of the state

HEIRS OF JUGALBOT VS CA 518 SCRA 202 (2007)

FACTS: In September 1997, an emancipation patent (EP) was issued to Nicolas Jugalbot based on his claim that he was the tenant of the subject property located in Cagayan De Oro. The subject property was in the name of Virginia Roa but it was originally registered in the name of Marcelino Cabili from whom Roa purchased the same in 1966.

Jugalbot alleged that he was a tenant of the property continuously since 1950s. but based on the certification of the Department of Agriculture (DAR), the subject property was declared to be tenanted as of October 1972. On March 1, 1988, the EP was registered with the RD and Jugalbot was issued TCT E-103.

In August 1998, the heirs of Virginia Roa filed a complaint for the cancellation of title, recovery of possession and damages against Jugalbot. Department of Agriculture Adjudication Board (DARAB) dismissed the case and upheld the EP issued to Jugalbot.

ISSUE: W/N A TENANCY RELATIONSHIP EXISTS BETWEEN PETITIONERS HEIRS OF JUGALBOT AND HEIRS OF ROA UNDER PD 27. (ARE PETITIONERS DE JURE TENANTS OF PRIVATE RESPONDENTS?)

HELD: To determine if a tenancy relationship exists, the following must be present:

a. The parties are the landowner and the tenantb. The subject matter is agricultural landc. There is consentd. The purpose is agricultural productione. There is personal cultivation by the tenantf. There is sharing of harvests between the parties

In an earlier case, it was affirmed that tenancy relationship cannot be presumed. The elements of tenancy must be first proved in order to entitle the claimant to security of tenure. The principal factor in determining whether a tenancy relationship exists is intent. The intent of the parties, the understanding when the farmer is installed, and their written agreements, provided they are not contrary to law are more important.

The SC held that the petitioners are not de jure tenants of the Roa under PD 27 due to the absence of the essential requisites that establish a tenancy relationship between them.

1. Virginia Roa was denied of due process because DAR failed to send notice of the impending land reform coverage, as the notice was addressed to her husband, Pedro Roa. There is no evidence that the

subject property was acquired during their marriage, thus the property belonged to her exclusively.

2. There is no concrete evidence on record sufficient to establish that Jugalbot or his heirs personally cultivated the land in question or that there was sharing of harvests.

The fact alone of working on another’s landholding does not raise a presumption of the existence of agricultural tenancy. Other factors must be taken into consideration like compensation in the form of lease rentals or a share in the produce of the landholding involved. Without the essential elements of consent and sharing, no tenancy relationship can exist between the petitioner and private respondents.

It may not be amiss to stress that laws which have for their object the preservation and maintenance of social justice are not only meant to favor the poor and underprivileged. They apply with equal force to those who, notwithstanding their more comfortable position in life, are equally deserving of protection from the courts. Social justice is not a license to trample on the rights of the rich in the guise of defending the poor, where no act of injustice or abuse is being committed against them.

Agabon vs NLRC 442 SCRA 573 (2004)

FACTS:

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. Petitioners then filed a complaint for illegal dismissal and payment of money claims and on December 28, 1999, the Labor Arbiter rendered a decision declaring the dismissals illegal and ordered private respondent to pay the monetary claims.

ISSUE: Whether or not respondent’s dismissal is illegal.

HELD:The Court ruled that the dismissal is legal and entitles them of payment of benefits. Dismissals based on just causes contemplate acts or omissions attributable to the employee while dismissals based on authorized causes involve grounds under the Labor Code which allow the employer to terminate employees. A termination for an authorized cause requires payment of separation pay.

When the dismissal is for just or authorized cause but due process was not observed, the dismissal should be upheld. While the procedural infirmity cannot be cured, it should not invalidate the dismissal. However, the employer should be held liable for non-compliance with the procedural requirements of due process. 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.

Where the dismissal is for a just cause, as in the instant case, the lack of statutory due process should not nullify the dismissal, or render it illegal, or ineffectual. However, the employer should indemnify the employee for the violation of his statutory rights. The indemnity to be imposed should be stiffer to discourage the abhorrent practice of "dismiss now, pay later," which we sought to deter. The sanction should be in the nature of indemnification or penalty and should depend on the facts of each case, taking into special consideration the gravity of the due process violation of the employer.

It must be stressed that in the present case, the petitioners committed a grave offense, i.e., abandonment, which, if the requirements of due process were complied with, would undoubtedly result in a valid dismissal.

An employee who is clearly guilty of conduct violative of Article 282 should not be protected by the Social Justice Clause of the Constitution. Social justice, as the term suggests, should be used only to correct an injustice. As the eminent Justice Jose P. Laurel observed, social justice must be founded on the recognition of the necessity of interdependence among diverse units of a society and of the protection that should be equally and evenly extended to all groups as a combined force in our social and economic life, consistent with the fundamental and paramount objective of the state of promoting the health, comfort, and quiet of all persons, and of bringing about "the greatest good to the greatest number."

Justice in every case should only be for the deserving party. It should not be presumed that every case of illegal dismissal would automatically be decided in favor of labor, as management has rights that should be fully respected and enforced by this Court. As interdependent and indispensable partners in nation-building, labor and management need each other to foster productivity and economic growth; hence, the need to weigh and balance the rights and welfare of both the employee and employer.

PLDT V NLRC (ABUCAY)

FACTS:

Private respondent Marliyn Abucay, a traffic operator for PLDT, was accused by 2 complainants of having demanded and received from them 3,800 pesos in consideration of her promise to facilitate the approval of their applications for phone installations.

Investigated and heard, she was found guilty and dismissed from service.

Respondent filed a complaint for illegal removal with the Ministry of Labor and Employment.

The complaint was dismissed, but the Labor Arbiter granted her separation pay of one month pay for every year of service.

Hence this petition, claiming the granting of financial assistance was made with grave abuse of discretion.

Petitioner contends that although Art 279 of the Labor Code entitles an employee to reinstatement and backwages if dismissed without just cause, one dismissed in accordance with law is not allowed any relief at all as this would be tantamount to rewarding the dissolute worker.

Respondent NLRC claims that dismissal was sufficient punishment and that the grant of financial assistance was intended to help her for the loss of employment after working faithfully for 10 years.

Similarly in the cases of Firestone Co. v Lariosa and Filipino, Inc. v NLRC, employees who were validly dismissed on grounds of violation of company policies were still awarded financial assistance on the ground of social and compassionate justice.

Petitioner contends that these cases ostensibly constitute the exception to Art 279, based on considerations of equity.

ISSUE:

WON it is legal to award financial assistance to an employee who had been dismissed with just cause

HELD: NO.

Separation pay shall only be allowed as a measure of social justice when the employee is validly dismissed for causes other than serious misconduct and not involving moral turpitude.

There is no doubt it is compassionate to give separation pay when the cause is not iniquitous as when a salesman is dismissed for his inability to fill his quota.

His company cannot be compelled to maintain him at the expense of the efficiency of their operations but the awarding of financial assistance would be sustainable under the policy of social justice.

However, the same salesman surely does not deserve such generosity if his offense is misappropriation of the receipts of his sales.

Such conduct is not simply inept but rather depraved and immoral, thus making him undeserving of such assistance.

Our Constitution is replete with positive commands for the promotion of social justice, and particularly the protection of the rights of the workers. However, social justice is not intended to countenance wrongdoing simply because it is committed by the underprivileged. Compassion for the poor is an imperative in every humane society, but only when the recipient is not a rascal claiming an undeserved privilege.

Hence, it may only be invoked by those whose hands are clean and whose motives are blameless.

Applying these considerations, the awarding of financial assistance is unjustified.

Petition is GRANTED

SEPARATE OPINIONPADILLA [concur]

I concur. However, in cases were separation pay is awarded, the amount to be granted should be left to the judgment of the NLRC (rather than the 1 month of pay for each year of service rule) and should not be disturbed by the Court in absence of evidence of grave abuse of discretion on the part of the NLRC.

FERNAN [dissent]Providing a rigid mathematical formula for computing the amounts of separation pay defies the spirit of the constitutional mandate that “those who have less in life should have more in law”.

These fixed rates would not favor the low-salaried employee as he would encounter difficulty in finding another job.GRINO-AQUINO [dissent]-We should not rationalize compassion.