1.

One afternoon, Jose chanced upon Erica riding in the car of

Paolo, a co-employee and Ericas ardent suitor; the two were on
their way back to the office from a sales call on Silver Drug, a
major drug retailer. In a fit of extreme jealousy, Jose rammed
Paolos car, causing severe injuries to Paolo and Erica. Joses flare
up also caused heavy damage to the two company-owned cars
they were driving.
(A) As lawyer for Magna, advise the company on whether just
and valid grounds exist to dismiss Jose. (4%)
(B)

Assuming

this

time

that

Magna

dismissed

Jose

from

employment for cause and you are the lawyer of Jose, how would
you argue the position that Joses dismissal was illegal? (4%)
(A) There are just causes to to dismiss Jose. The act of willfully
wrecking a company-owned vehicle assigned to Jose constitutes
serious misconduct and willful breach of the trust and confidence
reposed in him by Magna, both of which are grounds for
termination under Article 282 of the Labor Code. A high degree of
trust and confidence is reposed on a sales representative, who
must protect the name, business and property of the company.
As a sales representative, Jose is expected to preserve the
properties entrusted to him, including the company vehicle.
(B) There is no just case for terminating Jose. Article 282 of the
Labor Code provides the following just causes for termination: (i)
serious misconduct or willful disobedience of lawful orders; (ii)

gross and habitual neglect of duties; (iii) loss of trust and

confidence; (iv) offense against the person of employer; and (v)
analogous cases. It could not be willful disobedience because
there is no proof of the lawful order the employer has the
burden of proof and all doubts resolved in favor of labor. It could
not be neglect of duties because it has not been shown that it is
habitual. There is no loss of trust and confidence because the
employer failed to show the extent of duties and level of trust
reposed in Jose. It could not be a crime against the person of the
employer because what is involved is a car. There are no
analogous grounds.
2. In the course of a routine inspection, a Department of Labor
and Employment (DOLE) Inspector noted that the workers pay is
below the prescribed minimum wage of P426.00 plus P30.00
allowance, and thus required Gamma Company to pay wage
differentials.
Gamma Company denies any liability, explaining that after the
market value of the company-provided board and lodging are
added to the employees P350 cash daily wage, the employees
effective daily rate would be way above the minimum pay
required by law. The company counsel further points out that the
employees are aware that their food and lodging form part of
their salary, and have long accepted the arrangement.
No, the companys position is legally untenable.

Before the value of such facilities as food and lodging can be

deducted from their salaries, the following requirements must be
satisfied first:
a.) proof must be shown that such facilities are customarily
furnished

by

the

trade;

b.) the provision of deductible facilities must be voluntarily

accepted

in

writing

by

the

employee;

and

c.) facilities must be charged at fair and reasonable value.

In this case, there being no proof that the above requisites have
been

substantially

satisfied,

the

companys

position

must

necessarily fail.
3. Due to the slowdown of its export business in 2012, InterGarments had to reduce its overtime work; at teh same time, it
adjusted the overtime rates so that those who worked overtime
were only paid an aditional 25% instead of the previous 35%. To
replace the workersovertime rate loss, the company granted a
one-time 5% across-the-board wage increase.
Vigilant Union, the rank-and-file bargaining agent, charged the
company with Unfair Labor Practice on the ground that (1) no
consultations had been made on who would render overtime
work; and (2) the unilaterial overtime pay rate reduction is a
violation of Article 100 (entitled Prohibition Against Elimination or
Diminution of Benefits) of the Labor Code.

Is the union position meritorious? (8%)

1) Position lacks merit Management Prerogative (who would
render overtime)
2) Position is meritorious Company practice that has acquiesced
into benefits of employees over a period of time cannot be
unilaterally revoked.

It depends No (2).
In

this

more

particular

than

claimed

that

as

Elimination
criteria

the

required

violating
of

are

case,

by

in

Art.

Artical

Diminution

met

employer
100

of

order

87,

to

has
it

been
can

paying

only

(Prohibition
the

be

Against

Benefits)

if

following

prove

that

such

has

been

benefit

has ripened into company practice:

1.

The

act

of

the

employer

done

for a considerable period of time.

(Thus

far,

definitive

jurisprudence
rule

has

requiring

not

laid

specific

down

anyext

minimum

or

number

of years.)
2.

The

act

should

be

done

consistently

and intentionally.
3.

The

erroneous

act

should

interpretation

not

be
or

product

construction

of
of

doubtful

or

difficult

question

of

law

or provision in the CBA.

Referenced Laws/Legal Principles:
Principle

of

non-diminution

non-elimination

of

benefits

or

as

applied

to wages:
This
of

principle
withrawal

or

mandates
by

payments

that

employers

as

the
of

provided

reduction

any

in

or

benefits,

existing

diminution
supplements

laws,

individual

agreements or collective bargaining agreements between works

and

employers

or

voluntary

employer

practice

or

policy,

is not allowed.
Labor

Code

Art. 87. Overtime work. Work may be performed beyond

eight
paid

(8)
for

equivalent

hours
the
to

day

overtime
his

provided
work,

regular

an

wage

that

the

additional

plus

at

employee

is

compensation

least

twenty-five

percent (25%) thereof. Work performed beyond eight hours

on

holiday

compensation

or

rest

equivalent

day
to

shall
the

be
rate

paid
of

an

the

additional
first

eight

hours on a holiday or rest day plus at least thirty percent

(30%) thereof.
IV

Bobby, who was assigned as company branch accountant in Tarlac

where his family also lives, was dismissed by Theta Company
after anomalies in the companys accounts were discovered in the
branch. Bobby filed a complaint and was ordered reinstated with
full backwages after the Labor Arbiter found that he had been
denied due process because no investigation actually took place.
Theta

Company

appealed

to

the

National

Labor

Relations

Commission (NLRC) and at the same time wrote Bobby, advising

him to report to the main company office in Makati where he
would be reinstated pending appeal. Bobby refused to comply
with his new assignment because Makati is very far from Tarlac
and he cannot bring his family to live with him due to the higher
cost of living in Makati.
(A)

Is

Bobbys

reinstatement

pending

appeal

legally

correct? (4%)
(B) Advise Bobby on the best course of action to take
under the circumstances. (4%)
A) Yes, reinstatement pending appeal is correct. Order of
reinstatement is immediately executory, even pending appeal.
B)

Bobby

should

accept

the

reinstatement.

Management

prerogative where to assign the employee, so long as there is no

diminution of benefits and rank.

A transfer of work assignment without any justification therefor,

even if respondent would be presumably doing the same job with
the same pay, cannot be deemed faithful compliance with the
reinstatement order. Pfizer case, 2011
V
Cris filed a complaint for illegal dismissal against Baker Company.
The Labor Arbiter dismissed the complaint but awarded Cris
financial assistance. Only the company appealed from the Labor
Arbiters ruling. It confined its appeal solely to the question of
whether financial assistance could be awarded. The NLRC, instead
of ruling solely on the appealed issue, fully reversed the Labor
Arbiters decision; it found Baker Company liable for illegal
dismissal and ordered the payment of separation pay and full
backwages.
Through a petition for certiorari under Rule 65 of the Rules of
Court, Baker Company challenged the validity of the NLRC ruling.
It argued that the NLRC acted with grave abuse of discretion
when it ruled on the illegal dismissal issue, when the only issue
brought on appeal was the legal propriety of the financial
assistance award.
Cris countered that under Article 218(c) of the Labor Code, the
NLRC has the authority to correct, amend, or waive any error,
defect or irregularity whether in substance or in form in the
exercise of its appellate jurisdiction.

Decide the case. (8%)

The NLRC ruling is valid.
Although it is a well-settled rule in Remedial law that appellate
courts may only consider the issues raised on appeal, technical
rules, however, do not apply in labor cases.
By express provision of the Labor Code (Art. 218 (c)), the NLRC
may look into other issues of the case even if they were not
raised on appeal. Therefore, the NLRC did not rule with grave
abuse of discretion.
NLRC ruling is valid. There was no grave abuse of discretion.
NLRC Rules of Procedure: if the order or resolution will cause
injustice if not rectified.