UE College of Law

Labor Law Review

Judy M. Dumduma, Jr.
Atty.
Josephus B. Jimenez
WESLEYAN UNIVERSITY PHILIPPINES v. WESLEYAN UNIVERSITY- PHILIPPINES
FACULTY AND STAFF ASSOCIATION
G.R. No. 181806, March 12, 2014
Facts:
Petitioner Wesleyan University-Philippines is a non-stock, non-profit educational institution duly
organized and existing under the laws of the Philippines. Respondent Wesleyan University-Philippines
Faculty and Staff Association, on the other hand, is a duly registered labor organization acting as the sole
and exclusive bargaining agent of all rank-and-file faculty and staff employees of petitioner.
In December 2003, the parties signed a 5-year CBA effective June 1, 2003 until May 31, 2008.
On August 16, 2005, petitioner, through its President, Atty. Guillermo T. Maglaya, issued a
Memorandum providing guidelines on the implementation of vacation and sick leave credits as well as
vacation leave commutation.
Respondents President, Cynthia L. De Lara (De Lara) wrote a letter to Atty. Maglaya informing
him that respondent is not amenable to the unilateral changes made by petitioner. De Lara questioned the
guidelines for being violative of existing practices and the CBA.
A Labor Management Committee (LMC) Meeting was held during which petitioner advised
respondent to file a grievance complaint on the implementation of the vacation and sick leave policy. In
the same meeting, petitioner announced its plan of implementing a one-retirement policy, which was
unacceptable to respondent.
Unable to settle their differences at the grievance level, the parties referred the matter to a
Voluntary Arbitrator. The Voluntary Arbitrator rendered a Decision declaring the one-retirement policy
and the Memorandum dated August 16, 2005 contrary to law.
Aggrieved, petitioner appealed the case to the CA via a Petition for Review under Rule 43 of the
Rules of Court. The CA rendered a Decision finding the rulings of the Voluntary Arbitrator supported by
substantial evidence. It also affirmed the nullification of the one-retirement policy and the Memorandum
dated August 16, 2005 on the ground that these unilaterally amended the CBA without the consent of
respondent.
Issue: Can the petitioner unilaterally reduce the benefits received by its employees under the CBA?
Law Applicable: Article 100, Labor Code
Case History:
Voluntary Arbitrator ruled in favor of the respondents.
Court of Appeals- sustained the ruling of the voluntary arbitrator.
Ruling of the Supreme Court: No
The Non-Diminution Rule found in Article 100 of the Labor Code explicitly prohibits employers
from eliminating or reducing the benefits received by their employees. This rule, however, applies only if
the benefit is based on an express policy, a written contract, or has ripened into a practice. To be

UE College of Law
Labor Law Review
Judy M. Dumduma, Jr.
Atty.
Josephus B. Jimenez
considered a practice, it must be consistently and deliberately made by the employer over a long period of
time.
An exception to the rule is when "the practice is due to error in the construction or application of
a doubtful or difficult question of law." The error, however, must be corrected immediately after its
discovery; otherwise, the rule on Non-Diminution of Benefits would still apply.
In this case, respondent was able to present substantial evidence in the form of affidavits to
support its claim that there are two retirement plans. Based on the affidavits, petitioner has been giving
two retirement benefits as early as 1997. Petitioner, on the other hand, failed to present any evidence to
refute the veracity of these affidavits. Petitioners contention that these affidavits are self-serving holds no
water. The retired employees of petitioner have nothing to lose or gain in this case as they have already
received their retirement benefits. Thus, they have no reason to perjure themselves. Obviously, the only
reason they executed those affidavits is to bring out the truth. As we see it then, their affidavits,
corroborated by the affidavits of incumbent employees, are more than sufficient to show that the granting
of two retirement benefits to retiring employees had already ripened into a consistent and deliberate
practice.
These circumstances, taken together, bolster the finding that the two-retirement policy is a
practice. Thus, petitioner cannot, without the consent of respondent, eliminate the two-retirement policy
and implement a one-retirement policy as this would violate the rule on non-diminution of benefits.
Students Opinion:
The student humbly opines that the SC ruled correctly in favor of the respondents. The employer
cannot unilaterally reduce the benefits received by its employees under the CBA without their consent.
CBA is a contract entered into by an employer and a legitimate labor organization concerning the terms
and conditions of employment. Just like any other contract, the CBA is the law between the parties,
therefore both of them must comply with it in good faith.

UE College of Law
Labor Law Review
Judy M. Dumduma, Jr.
Atty.
Josephus B. Jimenez
EMIRATE SECURITY AND MAINTENANCE SYSTEMS, INC. and ROBERTO A. YAN, vs.
GLENDA M. MENESE
G.R. No. 182848, October 5, 2011
Facts:
Respondent Glenda M. Menese filed a complaint for constructive dismissal; illegal reduction of
salaries and allowances; separation pay; refund of contribution to cash bond; overtime, holiday, rest day
and premium pay; damages; and attorneys fees against the petitioners, Emirate Security and Maintenance
Systems, Inc. and its General Manager, Robert A. Yan.
Menese alleged in the compulsory arbitration proceedings that on April 1, 1999, the agency
engaged her services as payroll and billing clerk. She was assigned to the agencys security detachment at
the Philippine General Hospital. She was given a monthly salary of P9,200.00 and an allowance
of P2,500.00, for a total of P11,700.00 in compensation. Effective May 2001, her allowance was allegedly
reduced to P1,500.00 without notice, and P100.00 was deducted from her salary every month as her
contribution to a cash bond which lasted throughout her employment. She was required to work seven
days a week, from 8:00 a.m. to 5:00 p.m. She was also required to report for work on holidays, except on
New Years Day and Christmas. She claimed that she was never given overtime, holiday, rest day and
premium pay.
Menese further alleged that on May 4, 2001, she started getting pressures from the agency for her
to resign from her position because it had been committed to a certain Amy Claro, a protge of Mrs.
Violeta G. Dapula the new chief of the Security Division of the University of the Philippines
(UP) Manila and PGH. Menese raised the matter with Yan who told her that the agency was in the process
of establishing goodwill with Dapula, so it had to sacrifice her position to accommodate Dapulas request
to hire Claro.
Still not satisfied with what they did, the petitioners allegedly withheld her salary for May 16-31,
2001. She claimed that the petitioners dismissed her from the service without just cause and due process.
Issue: Did the petitioner illegally dismissed Glenda Mense?
Law: Article 282(a) of the Labor Code
Case History:

Labor Arbiter- declared Menese to have been constructively dismissed.

NLRC- reversed the Labor Arbiters ruling
Court of Appeals- reinstated the Labor Arbiters decision.

Ruling of the Supreme Court: Yes

In Blue Dairy Corporation v. NLRC, the Court stressed as a matter of principle that the
managerial prerogative to transfer personnel must be exercised without abuse of discretion, bearing in
mind the basic elements of justice and fair play. Having the right should not be confused with the manner
in which that right is exercised. Thus, it should not be used as a subterfuge by the employer to get rid of
an undesirable worker. Measured against this basic precept, the petitioners undoubtedly abused their
discretion or authority in transferring Menese to the agencys head office. She had become undesirable
because she stood in the way of Claros entry into the PGH detachment. Menese had to go, thus the need
for a pretext to get rid of her. The request of a client for the transfer became the overriding command that
prevailed over the lack of basis for the transfer.

UE College of Law
Labor Law Review
Judy M. Dumduma, Jr.
Josephus B. Jimenez

Atty.

We cannot blame Menese for refusing Yans offer to be transferred. Not only was the transfer
arbitrary and done in bad faith, it would also result, as Menese feared, in a demotion in rank and a
diminution in pay. Although Yan informed Menese that based on the request of the client, she will be
transferred to another assignment which however will not involve any demotion in rank nor diminution in
her salaries and other benefits, the offer was such as to invite reluctance and suspicion as it was couched
in a very general manner. We find credible Meneses submission on this point, i.e., that under the offered
transfer: (1) she would hold the position of lady guard and (2) she would be paid in accordance with the
statutory minimum wage, or from P11,720.00 to P7,500.00.
In these lights, Meneses transfer constituted a constructive dismissal as it had no justifiable basis
and entailed a demotion in rank and a diminution in pay for her. For a transfer not to be considered a
constructive dismissal, the employer must be able to show that the transfer is for a valid reason, entails no
diminution in the terms and conditions of employment, and must be unreasonably inconvenient or
prejudicial to the employee. If the employer fails to meet these standards, the employees transfer shall
amount, at the very least, to constructive dismissal. The petitioners, unfortunately for them, failed to come
up to these standards.
Students Opinion:
The student humbly submits that the Supreme Court correctly held that Menese was illegally
dismissed. The evidence presented by Menese clearly showed that the petitioner resorted to underhanded
tactics to force her from vacating her position as payroll and billing officer when she refused to do so. It
was also clearly proved by evidence presented that there was no ground to have Menese transferred from
the PGH detachment to the companys main office, and that the machinations of the petitioner company
was clearly done to curry favor with the incoming chief of the Security Division, Violeta Dapula. Thus
Menese was indeed illegally dismissed.

UE College of Law
Labor Law Review
Judy M. Dumduma, Jr.
Atty.
Josephus B. Jimenez
SLL INTERNATIONAL CABLES SPECIALIST and SONNY L. LAGON vs.
NATIONAL LABOR RELATIONS COMMISSION, 4th DIVISION, ROLDAN LOPEZ,
EDGARDO ZUIGA and DANILO CAETE,
G.R. No. 172161
March 2, 2011
Facts:
Sometime in 1996, and January 1997, private respondents Roldan Lopez (Lopez for brevity) and
Danilo Caete (Caete for brevity), and Edgardo Zuiga (Zuiga for brevity) respectively, were hired by
petitioner Lagon as apprentice or trainee cable/lineman. The three were paid the full minimum wage and
other benefits but since they were only trainees, they did not report for work regularly but came in as
substitutes to the regular workers or in undertakings that needed extra workers to expedite completion of
work. After their training, Zuiga, Caete and Lopez were engaged as project employees by the petitioners
in their Islacom project in Bohol. Private respondents started on March 15, 1997 until December 1997.
Upon the completion of their project, their employment was also terminated. Private respondents received
the amount of P145.00, the minimum prescribed daily wage for Region VII. In July 1997, the amount
of P145 was increased to P150.00 by the Regional Wage Board (RWB) and in October of the same year,
the latter was increased to P155.00. Sometime in March 1998, Zuiga and Caete were engaged again by
Lagon as project employees for its PLDT Antipolo, Rizal project, which ended sometime in (sic) the late
September 1998. As a consequence, Zuiga and Caetes employment was terminated. For this project,
Zuiga and Caete received only the wage ofP145.00 daily. The minimum prescribed wage for Rizal at that
time was P160.00.
Sometime in late November 1998, private respondents re-applied in the Racitelcom project of
Lagon in Bulacan. Zuiga and Caete were re-employed. Lopez was also hired for the said specific project.
For this, private respondents received the wage of P145.00. Again, after the completion of their project in
March 1999, private respondents went home to Cebu City.
On May 21, 1999, private respondents for the 4 th time worked with Lagons project in
Camarin, Caloocan City with Furukawa Corporation as the general contractor. Their contract would
expire on February 28, 2000, the period of completion of the project. From May 21, 1997December 1999, private respondents received the wage ofP145.00. At this time, the minimum prescribed
rate for Manila was P198.00. In January to February 28, the three received the wage of P165.00. The
existing rate at that time was P213.00.
For reasons of delay on the delivery of imported materials from Furukawa Corporation, the
Camarin project was not completed on the scheduled date of completion. Face[d] with economic
problem[s], Lagon was constrained to cut down the overtime work of its worker[s][,] including private
respondents. Thus, when requested by private respondents on February 28, 2000 to work overtime, Lagon
refused and told private respondents that if they insist, they would have to go home at their own expense
and that they would not be given anymore time nor allowed to stay in the quarters. This prompted private
respondents to leave their work and went home to Cebu. On March 3, 2000, private respondents filed a
complaint for illegal dismissal, non-payment of wages, holiday pay, 13 th month pay for 1997 and 1998
and service incentive leave pay as well as damages and attorneys fees.
Issue: Did the petitioner fail to comply with the payment of the prescribed minimum wage?
Law: Labor Code, DOLE Memorandum Circular No. 2

UE College of Law
Labor Law Review
Judy M. Dumduma, Jr.
Josephus B. Jimenez

Atty.

Case History:

Labor Arbiter- found that the respondents were underpaid, however it found that the petitioner
was not liable for illegal dismissal.
NLRC- affirmed the findings of the Labor Arbiter.
Court of Appeals- affirmed the ruling of the NLRC with modification.

Ruling of the Supreme Court: Yes

Private respondents, are entitled to be paid the minimum wage, whether they are regular or nonregular employees. Section 3, Rule VII of the Rules to Implement the Labor Code specifically enumerates
those who are not covered by the payment of minimum wage. Project employees are not among them.
On whether the value of the facilities should be included in the computation of the wages
received by private respondents, Section 1 of DOLE Memorandum Circular No. 2 provides that an
employer may provide subsidized meals and snacks to his employees provided that the subsidy shall not
be less that 30% of the fair and reasonable value of such facilities. In such cases, the employer may
deduct from the wages of the employees not more than 70% of the value of the meals and snacks enjoyed
by the latter, provided that such deduction is with the written authorization of the employees concerned
Moreover, before the value of facilities can be deducted from the employees wages, the following
requisites must all be attendant: first, proof must be shown that such facilities are customarily furnished
by the trade; second, the provision of deductible facilities must be voluntarily accepted in writing by the
employee; and finally, facilities must be charged at reasonable value. Mere availment is not sufficient to
allow deductions from employees wages.
These requirements, however, have not been met in this case. SLL failed to present any company
policy or guideline showing that provisions for meals and lodging were part of the employees salaries. It
also failed to provide proof of the employees written authorization, much less show how they arrived at
their valuations. At any rate, it is not even clear whether private respondents actually enjoyed said
facilities.
Students Opinion:
This student humbly submits that the Supreme Court ruled correctly in declaring that the
petitioner failed to comply with the payment of the prescribed minimum wages. The evidence presented
by the respondents clearly showed that the petitioner was not paying the prescribed minimum wages even
before it suffered financial difficulties. It cannot also deprive its employees of their proper compensation
in the guise of supplements, especially when the employees have not expressly agreed, in writing, to
receive such supplements.

UE College of Law
Labor Law Review
Judy M. Dumduma, Jr.
Atty.
Josephus B. Jimenez
CAPITOL WIRELESS, INC. vs. HONORABLE SECRETARY MA. NIEVES R. CONFESOR and
KILUSANG MANGGAGAWA NG CAPWIRE KMC-NAFLU
G.R. No. 117174. November 13, 1996
Facts:
Petitioner Capitol Wireless, Inc., and respondent Kilusang Manggagawa ng Capwire KMCNAFLU (Union) entered into a Collective Bargaining Agreement (CBA) on 15 November 1990 covering
a period of five (5) years. Towards the end of the third year of their CBA the parties renegotiated the
economic aspects of the agreement. On 18 July 1993 when the negotiations were on-going petitioner
dismissed on the ground of redundancy eight (8) out of its eleven (11) couriers who were Union members.
As a consequence, respondent Union filed a notice of strike with the National Conciliation and
Mediation Board (NCMB) on the ground of bargaining deadlock and unfair labor practice, specifically,
for illegal dismissal and violations of the CBA. Conciliation proceedings were conducted by the NCMB
but the same yielded negative results. On 20 August 1993 respondent Union went on strike. On the same
day, respondent Secretary assumed jurisdiction over the controversy.
In the conference held on 14 September 1993 the parties agreed to confine the scope of the
dispute to the following issues: (a) unfair labor practice, consisting of CBA violations and acts inimical to
the workers right to self-organization; (b) redundancy, affecting the dismissed employees; and (c) CBA
deadlock, which includes all items covered by respondent Unions proposals.
On 2 May 1994 respondents Secretary of Labor resolved the controversy in this manner: (1) the
parties were ordered to modify the fourth and fifth years of their CBA in accordance with the dispositions
she found just and equitable the same to be retroactive to 1 July 1993 and effective until 30 June 1995 or
until superseded by a new agreement; (2) all other provisions of the existing CBA were deemed retained
but all new demands of respondent Union that were not passed upon by her deemed denied; (3) the
dismissal of the eight (8) employees on the ground of redundancy was upheld, but due to defective
implementation by petitioner the latter was ordered to pay each of the former an indemnity equivalent to
two (2) months salary based on their adjusted rate for the fourth year in addition to the separation benefits
due them under the law and the CBA, and if still unpaid, petitioner to pay the same immediately; and (4)
the charge of unfair labor practice was dismissed for lack of merit.
Issues:

Did the petitioner violate due process in the dismissal of the employees when it failed to appraise
respondent Union of any fair and reasonable criteria for implementation of its redundancy
program?
Are the dismissed employees entitled to 2 months salary?

Laws:

Article 287 of the Labor Code, as amended by R.A. 7641

Case History:

Conciliation proceedings were conducted by the NCMB but the same yielded negative results.
Respondent Secretary assumed jurisdiction over the controversy

UE College of Law
Labor Law Review
Judy M. Dumduma, Jr.
Josephus B. Jimenez
Ruling of the Supreme Court:

Atty.

First issue: Yes.

Its violation of due process consists in its failure, as found by respondent Secretary of Labor, to
apprise respondent Union of any fair and reasonable criteria for implementation of its redundancy
program. In Asiaworld we laid down the principle that in selecting employees to be dismissed a fair and
reasonable criteria must be used, such as but not limited to: (a) less preferred status (e.g., temporary
employee), (b) efficiency and (c) seniority. Although the case of Asiaworld dealt with retrenchment, still
the principle is applicable to the present case because in effecting the dismissals petitioner had to select
from among its employees.
We agree with respondent Secretary of Labor in her observation and conclusion that the
implementation by petitioner of its redundancy program was inconsistent with established principles of
procedural due process.
Second Issue: Yes.
Article 287 of the Labor Code, as amended by R.A. 7641, provides
Retirement. Any employee may be retired upon reaching the retirement age established in the
collective bargaining agreement or other applicable employment contract.
In case of retirement, the employee shall be entitled to receive such retirement benefits as he may
have earned under existing laws and any collective bargaining agreement and other agreements: provided,
however, That an employees retirement benefits under any collective bargaining and other agreements
shall not be less than those provided herein.
In the absence of a retirement plan or agreement plan providing for retirement benefits of
employees in the establishment, an employee upon reaching the age of sixty (60) years or more, but not
beyond sixty-five (65) years which is hereby declared the compulsory retirement age, who has served at
least five (5) years in the said establishment, may retire and shall be entitled to retirement pay equivalent
to at least one-half (1/2) month salary for every year of service, a fraction of at least six (6) months being
considered as one whole year.
Unless the parties provide for broader inclusions, the term one-half (1/2) month salary shall mean
fifteen (15) days plus one-twelfth (1/12) of the 13th month pay and the cash equivalent of not more than
five (5) days of service incentive leaves x x x x (italics supplied).
The records fail to disclose that petitioner bothered to inform the Court how it arrived at 21.82
days as basis in the computation of the retirement pay. Anyway, it is clear in the law that the term one-half
(1/2) month salary means 22.5 days: 15 days plus 2.5 days representing one-twelfth (1/12) of the 13th
month pay plus 5 days of service incentive leave. In this regard, there is no reason for petitioner to
complain that the retirement benefits granted by respondent Secretary of Labor exceeded the requirements
of law.
Opinion of the Student:
The student respectfully opines that the Supreme Court decided the case correctly. The facts of
the case clearly show that the petitioner company failed to inform the union about the redundancy
program and the plan to dismiss 8 employees, even when communication lines between the two are open

UE College of Law
Labor Law Review
Judy M. Dumduma, Jr.
Atty.
Josephus B. Jimenez
by reason of the ongoing negotiation. Clearly the petitioner has shown utter disregard for due process
provided under our laws.
INSULAR HOTEL EMPLOYEES UNION-NFL vs. WATERFRONT INSULAR HOTEL DAVAO,
G.R. Nos. 174040-41, September 22, 2010
Facts:
Respondent Waterfront Insular Hotel Davao (respondent) sent the Department of Labor and
Employment (DOLE), Region XI, Davao City, a Notice of Suspension of Operations[5] notifying the
same that it will suspend its operations for a period of six months due to severe and serious business
losses. In said notice, respondent assured the DOLE that if the company could not resume its operations
within the six-month period, the company would pay the affected employees all the benefits legally due to
them.
During the period of the suspension, Domy R. Rojas (Rojas), the President of Davao Insular
Hotel Free Employees Union (DIHFEU-NFL), the recognized labor organization in Waterfront Davao,
sent respondent a number of letters asking management to reconsider its decision. Rojas intimated that the
members of the Union were determined to keep their jobs and that they believed they too had to help
respondent.
In a handwritten letter dated November 25, 2000, Rojas once again appealed to respondent for it
to consider their proposals and to re-open the hotel. In said letter, Rojas stated that manpower for fixed
manning shall be one hundred (100) rank-and-file Union members instead of the one hundred forty-five
(145) originally proposed.
After series of negotiations, respondent and DIHFEU-NFL, represented by its President, Rojas,
and Vice-Presidents, Exequiel J. Varela Jr. and Avelino C. Bation, Jr., signed a Memorandum of
Agreement (MOA) wherein respondent agreed to re-open the hotel subject to certain concessions offered
by DIHFEU-NFL in its Manifesto.
Accordingly, respondent downsized its manpower structure to 100 rank-and-file employees as set
forth in the terms of the MOA. Moreover, as agreed upon in the MOA, a new pay scale was also prepared
by respondent.
The retained employees individually signed a Reconfirmation of Employment which embodied
the new terms and conditions of their continued employment. Each employee was assisted by Rojas who
also signed the document. On June 15, 2001, respondent resumed its business operations.
On August 22, 2002, Darius Joves (Joves) and Debbie Planas, claiming to be local officers of the
National Federation of Labor (NFL), filed a Notice of Mediation before the National Conciliation and
Mediation Board (NCMB), Region XI, Davao City. In said Notice, it was stated that the Union involved
was DARIUS JOVES/DEBBIE PLANAS ET. AL, National Federation of Labor. The issue raised in said
Notice was the Diminution of wages and other benefits through unlawful Memorandum of Agreement.
Issue: Can a Memorandum of Agreement, voluntarily entered into by an authorized labor union, reducing
wages and benefits received by employees be valid?

UE College of Law
Labor Law Review
Judy M. Dumduma, Jr.
Josephus B. Jimenez

Atty.

Law:
Labor Code
Case History:

Accredited Voluntary Arbitrator: Declared the Memorandum of Agreement in question as

invalid as it is contrary to law and public policy
Court of Appeals: Reversed the decision of the AVA and declared the MOA as valid and
enforceable

Ruling of the Supreme Court: Yes

While the scales of justice usually tilt in favor of labor, the peculiar circumstances herein
prevent this Court from applying the same in the instant petition. Even if our laws endeavour to give
life to the constitutional policy on social justice and on the protection of labor, it does not mean that
every labor dispute will be decided in favor of the workers. The law also recognizes that management
has rights which are also entitled to respect and enforcement in the interest of fair play.
Even assuming arguendo that Article 100 applies to the case at bar, this Court agrees with
respondent that the same does not prohibit a union from offering and agreeing to reduce wages and
benefits of the employees. In Rivera v. Espiritu, this Court ruled that the right to free collective
bargaining, after all, includes the right to suspend it.
While the terms of the MOA undoubtedly reduced the salaries and certain benefits previously
enjoyed by the members of the Union, it cannot escape this Court's attention that it was the execution
of the MOA which paved the way for the re-opening of the hotel, notwithstanding its financial
distress. More importantly, the execution of the MOA allowed respondents to keep their jobs. It
would certainly be iniquitous for the members of the Union to sign new contracts prompting the reopening of the hotel only to later on renege on their agreement on the fact of the non-ratification of
the MOA.
Opinion of the Student:
The student humbly opines that the Supreme Court was correct in deciding the case in favor of
Insular Hotel. It would be iniquitous in ordering an entity, who is already suffering financially, to give full
privileges to its employees when it already decided to cease its operation, but reopened out of
consideration for its employees, who already agreed to receive lesser benefits.

UE College of Law
Labor Law Review
Judy M. Dumduma, Jr.
Atty.
Josephus B. Jimenez
MANSION PRINTING CENTER and CLEMENT CHENG, vs. DIOSDADO BITARA, JR.
G.R. No. 168120 January 25, 2012
Facts:
Sometime in August 1998, petitioners engaged the services of respondent as a helper (kargador).
Respondent was later promoted as the companys sole driver tasked to pick-up raw materials for the
printing business, collect account receivables and deliver the products to the clients within the delivery
schedules. Petitioners aver that the timely delivery of the products to the clients is one of the foremost
considerations material to the operation of the business. It being so, they closely monitored the attendance
of respondent. They noted his habitual tardiness and absenteeism.
Thus, as early as 23 June 1999, petitioners issued a Memorandum requiring respondent to submit
a written explanation why no administrative sanction should be imposed on him for his habitual tardiness.
Several months after, respondents attention on the matter was again called to which he promised to go
work on time.
Despite respondents undertaking to report on time, however, he continued to disregard
attendance policies. His weekly time record for the first quarter of the year 2000 revealed that he came
late nineteen (19) times out of the forty-seven (47) times he reported for work. He also incurred nineteen
(19) absences out of the sixty-six (66) working days during the quarter. His absences without prior notice
and approval from March 11-16, 2000 were considered to be the most serious infraction of all because of
its adverse effect on business operations.
Consequently, Davis Cheng, General Manager of the company and son of petitioner Cheng,
issued on 17 March 2000 another Memorandum (Notice to Explain) requiring respondent to explain why
his services should not be terminated. He personally handed the Notice to Explain to respondent but the
latter, after reading the directive, refused to acknowledge receipt thereof. He did not submit any
explanation and, thereafter, never reported for work.
On 21 March 2000, Davis Cheng personally served another Memorandum (Notice of
Termination) upon him informing him that the company found him grossly negligent of his duties, for
which reason, his services were terminated effective 1 April 2000. On even date, respondent met with the
management requesting for reconsideration of his termination from the service. However, after hearing
his position, the management decided to implement the 21 March 2000 Memorandum. Nevertheless, the
management, out of generosity, offered respondent financial assistance in the amount of P6,110.00
equivalent to his one month salary. Respondent demanded that he be given the amount equivalent to two
(2) months salary but the management declined as it believed it would, in effect, reward respondent for
being negligent of his duties.
On 27 April 2000, respondent filed a complaint for illegal dismissal against the petitioners before
the Labor Arbiter. He prayed for his reinstatement and for the payment of full backwages, legal holiday
pay, service incentive leave pay, damages and attorneys fees.
Issue: Was respondent Bitara Jr. illegally dismissed?
Law: Labor Code
Case History:

Labor Arbiter dismissed the complaint for lack of merit.

UE College of Law
Labor Law Review
Judy M. Dumduma, Jr.
Josephus B. Jimenez
NLRC affirmed the findings of the Labor Arbiter en toto.
The Court of Appeals found for the respondent and reversed the findings of the NLRC

Atty.

Ruling of the Supreme Court: No

In order to validly dismiss an employee, the employer is required to observe both substantive and
procedural aspects the termination of employment must be based on a just or authorized cause of
dismissal and the dismissal must be effected after due notice and hearing.
Substantive Due Process
Necessarily, he was considered for termination of employment because of his previous infractions
capped by his recent unauthorized absences from March 11-16, 2000. That the recent absences were
unauthorized were satisfactorily established by petitioners. Two (2) employees of the company belied the
claim of respondents wife Mary Ann Bitara that she called the office on 11 March 2000, and, through a
certain Delia, as allegedly later identified by respondent, informed petitioners that her husband would
take a leave of absence for a week because he went to the province.
Petitioners have repeatedly called the attention of respondent concerning his habitual tardiness.
The Memorandum dated 23 June 1999 of petitioner Cheng required him to explain his tardiness. Also in
connection with a similar infraction, respondent even wrote petitioner Cheng a letter dated 29 November
1999 where he admitted that his tardiness has affected the delivery schedules of the company, offered an
apology, and undertook to henceforth report for duty on time. Despite this undertaking, he continued to
either absent himself from work or report late during the first quarter of 2000.
We, therefore, agree with the Labor Arbiters findings, to wit: The imputed absence and
tardiness of the complainant are documented. He faltered on his attendance 38 times of the 66 working
days. His last absences on 11, 13, 14, 15 and 16 March 2000 were undertaken without even
notice/permission from management. These attendance delinquencies may be characterized as habitual
and are sufficient justifications to terminate the complainants employment.
In Valiao, we defined gross negligence as want of care in the performance of ones duties
and habitual neglect as repeated failure to perform ones duties for a period of time, depending upon the
circumstances. These are not overly technical terms, which, in the first place, are expressly sanctioned
by the Labor Code of the Philippines
We cannot simply tolerate injustice to employers if only to protect the welfare of undeserving
employees. As aptly put by then Associate Justice Leonardo A. Quisumbing: Needless to say, so
irresponsible an employee like petitioner does not deserve a place in the workplace, and it is within the
managements prerogative xxx to terminate his employment. Even as the law is solicitous of the welfare
of employees, it must also protect the rights of an employer to exercise what are clearly management
prerogatives. As long as the companys exercise of those rights and prerogative is in good faith to advance
its interest and not for the purpose of defeating or circumventing the rights of employees under the laws
or valid agreements, such exercise will be upheld.
Procedural Due Process
Procedural due process entails compliance with the two-notice rule in dismissing an employee, to
wit: (1) the employer must inform the employee of the specific acts or omissions for which his dismissal
is sought; and (2) after the employee has been given the opportunity to be heard, the employer must
inform him of the decision to terminate his employment.

UE College of Law
Labor Law Review
Judy M. Dumduma, Jr.
Atty.
Josephus B. Jimenez
Davis Cheng, did both. First, he indicated in the notices the notation that respondent refused to
sign together with the corresponding dates of service. Second, he executed an Affidavit dated 29 July
2000 stating that: (1) he is the General Manager of the company; (2) he personally served each notice
upon respondent, when respondent went to the office/factory on 17 March 2000 and 21 March 2000,
respectively; and (3) on both occasions, after reading the contents of the memoranda, respondent refused
to acknowledge receipt thereof. We are, thus, convinced that the notices have been validly served.
Premises considered, we find that respondent was accorded both substantive and procedural due
process. Accordingly, we affirm the ruling of the National Labor Relations Commission that the dismissal
was valid.
Opinion of the Student:
The student agrees with the ruling of the Supreme Court. While it is true that our laws afford
protection to labor, we must not lose sight of the fact that the employer also has rights. It would be a great
injustice to the employer if our laws will also protect erring employees who already caused irreparable
damage to the business of the said employer.