CASE DIGESTS:

1. Lilia P. Labadan vs. Forest Hills Academy. G.R. No. 172295 December 23, 2008

FACTS:
While in cases of illegal dismissal, the employer bears the burden of proving that the
dismissal is for a valid or authorized cause, the employee must first establish by
substantial evidence the fact of dismissal.
Lilian L. Labadan (Labadan) was hired by Forest Hills Mission Academy (Forest Hills) as
an elementary school teacher in 1989. After one year of employment, she was made
registrar and secondary school teacher. In 2003, Labadan filed a complaint against
Forest Hills for illegal dismissal, non-payment of overtime pay, holiday pay, allowances,
13th month pay, service incentive leave, illegal deductions, and damages. She alleged
that she was allowed to go on leave, and albeit she had exceeded her approved leave
period, its extension was impliedly approved by the school principal because Labadan
received no warning or reprimand, and was in fact retained in the payroll. Labadan
further alleged that since 1990, tithes to the Seventh Day Adventist church, of which she
was a member, have been illegally deducted from her salary; and she was not paid
overtime pay for overtime service, 13th month pay, five days service incentive leave
pay, and holiday pay; and that her SSS contributions have not been remitted.
Forest Hills claims that Labadan was permitted to go on leave for two weeks but did not
return for work after the expiration of the period granted. Because of Labadans failure
to report to work despite promises to do so, Forest Hills hired a temporary employee to
accomplish the needed reports. When Labadan did return for work, classes for the
school year were already underway. With regard to the charge for illegal deduction,
Forest Hills claimed that the Seventh Day Adventist church requires its members to pay
tithes equivalent to 10% of their salaries, and that Labadan never questioned
the deduction of the tithe from her salary. As regards the non-payment of overtime pay,
holiday pay, and allowances, Forest Hills noted that petitioner proffered no evidence to
support the same.
The Labor Arbiter decided in favor of Labadan, and found that she was illegally
dismissed, and dismissed her claims for overtime pay, holiday pay, allowances, 13th
month pay, service incentive leave. The National Labor Relations Commission (NLRC)
reversed and set aside the Labor Arbiters decision with regard to the finding of illegal
dismissal. Labadan then filed a Petition for Certiorari with the Court of Appeals, which
was dismissed by the same. Hence, this Petition for Review on Certiorari.
ISSUES:
Whether or not Labadan was illegally dismissed by Forest Hills

HELD:
While in cases of illegal dismissal, the employer bears the burden of proving that the
dismissal is for a valid or authorized cause, the employee must first establish by
substantial evidence the fact of dismissal.
The records do not show that petitioner was dismissed from the service. They in fact
show that despite petitioners absence from July 2001 to March 2002 which, by her own
admission, exceeded her approved leave, she was still considered a member of the
Forest Hills faculty which retained her in its payroll.
Labadan argues, however, that she was constructively dismissed when Forest Hills
merged her class with another so much that when she reported back to work, she has
no more claims to hold and no more work to do. Labadan, however, failed to refute
Forest Hills claim that when she expressed her intention to resume teaching, classes
were already ongoing for School Year 2002-2003. It bears noting that petitioner
simultaneously held the positions of secondary school teacher and registrar and, as the
NLRC noted, she could have resumed her work as registrar had she really wanted to
continue working with Forest Hills.
Labadans affidavit and those of her former colleagues, which she attached to her
Position Paper, merely attested that she was dismissed from her job without valid
cause, but gave no particulars on when and how she was dismissed.
Note:
Respecting petitioners claim for holiday pay, Forest Hills contends that petitioner failed
to prove that she actually worked during specific holidays. Article 94 of the Labor Code
provides, however, that(a) Every worker shall be paid his regular daily wage during
regular holidays, except in retail and service establishments regularly employing less
than ten (10) workers; (b) The employer may require an employee to work on any
holiday but such employee shall be paid a compensation equivalent to twice his regular
rate.The provision that a worker is entitled to twice his regular rate if he is required to
work on a holiday implies that the provision entitling a worker to his regular rate on
holidays applies even if he does not work.
2. Imbuido v. NLRC [G.R. No. 114734, March 31, 2000]
FACTS:
Petitioner was employed as a date encoder by private respondent. From 1988 until
1991, she entered into 13 employment contracts with private respondent, each contract
for a period of 3 months. In September 1991, petitioner and 12 other employees
allegedly agreed to the filing of a PCE of the rank and file employees of private
respondent. Subsequently, petition received a termination latter due to low volume of

work. Petitioner filed a complaint for illegal dismissal. The labor Arbiter found in favor of
petitioner ruling that she was a regular employee. The NLRC reversed the decision
stating that although petitioner is a regular employee, she has no tenurial security
beyond the period for which she was hired (only up to the time the specific project for
which she was hired was completed). Petitioner filed the present appeal.

ISSUE:
W/N petitioner is a regular employee entitled to tenurial security and was therefore
unjustly dismissed.
HELD:
Yes. Even though petitioner is a project employee, as in the case of Maraguinot, Jr. v.
NLRC, the court held that a project employee or member of a work pool may acquire
the status of a regular employee when the following concur:
1. there is continuous rehiring of project employees even after the cessation of a
project,
2. the tasks performed by the alleged project employee are vital, necessary and
indispensable to the usual business and trade of the employer.
Private respondent was employed as a data encoder performing duties, which are
usually necessary or desirable in the usual business or trade of the employer,
continuously for a period of more than 3 years. Being a regular employee, petitioner is
entitled to security of tenure and could only be dismissed for a just and authorized
cause; low volume of work is not a valid cause for dismissal under Art. 282 or 283.
Having worked for more than 3 years, petitioner is also entitled to service incentive
leave benefits from 1989 until her actual reinstatement since such is demandable after
one year of service, whether continuous or broken.
3. Mansion Printing & Cheng v. Bitara, Jr.
FACTS:

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, petitioners issued a Memorandumrequiring respondent to submit a written

explanation why no administrative sanction should be imposed on him for his habitual
tardiness.

Despite respondents undertaking to report on time, however, he continued to disregard

attendance policies.

Consequently, Davis Cheng, General Manager of the company and son of petitioner
Cheng, issued 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.

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.

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 Memorandum. Nevertheless, the management, out of
generosity, offered respondent financial assistance in the amount ofP6,110.00
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.

Respondent filed a complaintfor illegal dismissal against the petitioners before the Labor
Arbiter.

Labor Arbiter dismissed the complaint for lack of merit.

On appeal to the National Labor Relations Commission, the findings of the Labor Arbiter
was AFFIRMEDen toto.

Before the Court of Appeals, respondent sought the annulment of the Commissions
Resolution on the ground that they were rendered with grave abuse of discretion and/or
without or in excess of jurisdiction.

The Court of Appeals found for the respondent and reversed the findings of the
Commission.

ISSUE: Whether or not respondent is illegally dismissed?

HELD: NLRC's decision is reinstated.

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.

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.

On this score,Valiao v. Court of Appealsis instructive:

xxx It bears stressing that petitioners absences and tardiness were not isolated
incidents but manifested a pattern of habituality. xxx The totality of infractions or the
number of violations committed during the period of employment shall be considered in
determining the penalty to be imposed upon an erring employee. The offenses
committed by him should not be taken singly and separately but in their totality. Fitness
for continued employment cannot be compartmentalized into tight little cubicles of
aspects of character, conduct, and ability separate and independent of each other.

InValiao,we definedgross negligenceas want of care in the performance of ones

dutiesandhabitual neglectas repeated failure to perform ones duties for a period of time,
depending upon the circumstances.51 These are not overly technical terms, which, in
the first place, are expressly sanctioned by the Labor Code of the Philippines, to wit:
ART. 282.Termination by employer.- An employer may terminate an employment for any
of the following causes:
(a) xxx
(b)Gross and habitual neglect by the employee of his duties;
xxx
Clearly, even in the absence of a written company rule defining gross and habitual
neglect of duties, respondents omissions qualify as such warranting his dismissal from
the service.

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 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.
4. Integrated Contractor and Plumbing Works, Inc. vs. National Labor Relations
Commission and Glen Solon, G.R. No. 152427. August 9, 2005
Facts:
Petitioner is a plumbing contractor. Its business depends on the number and frequency
of the projects it is able to contract with its clients. On February 23, 1998, while private
respondent was about to log out from work, he was informed by the warehouseman that
the main office had instructed them to tell him it was his last day of work as he had been
terminated. When private respondent went to the petitioner's office on February 24,
1998 to verify his status, he found out that indeed, he had been terminated. He filed a
complaint alleging that he was illegally dismissed without just cause and without due
process. the Labor Arbiter ruled that private respondent was a regular employee and
could only be removed for cause. Petitioner was ordered to reinstate private respondent
to his former position with full backwages from the time his salary was withheld until his
actual reinstatement, and pay him service incentive leave pay, and 13th month pay for
three years. Petitioner further filed a
motion for reconsideration which was denied. It filed an appeal before the CA but it was
subsequently dismissed for lack of merit.

Issue:
Whether the respondent is a project employee of the petitioner or a regular employee.

HELD
No. He was considered as a regular employee.
We held in Tomas Lao Construction v. NLRC 12 that the principal test in determining
whether an employee is a "project employee" or "regular employee," is, whether he is
assigned to carry out a "specific project or undertaking," the duration (and scope) of
which are specified at the time the employee is engaged in the project. 13 "Project"
refers to a particular job or undertaking that is within the regular or usual business of the
employer, but which is distinct and separate and identifiable from the undertakings of
the company. Such job or undertaking begins and ends at determined or determinable
times.
A review of private respondent's work assignments patently showed he belonged to a
work pool tapped from where workers are and assigned whenever their services were
needed. In a work pool, the workers do not receive salaries and are free to seek other
employment during temporary breaks in the business. They are like regular seasonal
workers insofar as the effect of temporary cessation of work is concerned. This
arrangement is beneficial to both the employer and employee for it prevents the unjust
situation of "coddling labor at the expense of capital" and at the same time enables the
workers to attain the status of regular employees. 15 Nonetheless, the pattern of rehiring and the recurring need for his services are sufficient evidence of the necessity
and indispensability of such services to petitioner's business or trade.
In Maraguinot, Jr. v. NLRC we ruled that once a project or work pool employee has
been: (1) continuously, as opposed to intermittently, re-hired by the same employer for
the same tasks or nature of tasks; and (2) these tasks are vital, necessary and
indispensable to the usual business or trade of the employer, then the employee must
be deemed a regular employee.
The test to determine whether employment is regular or not is the reasonable
connection between the particular activity performed by the employee in relation to the
usual business or trade of the employer. Also, if the employee has been performing the
job for at least one year, even if the performance is not continuous or merely
intermittent, the law deems the repeated and continuing need for its performance as
sufficient evidence of the necessity, if not indispensability of that activity to the business.
Thus, we held that where the employment of project employees is extended long after
the supposed project has been finished, the employees are removed from the scope of
project employees and are considered regular employees.
While length of time may not be the controlling test for project employment, it is vital in
determining if the employee was hired for a specific undertaking or tasked to perform
functions vital, necessary and indispensable to the usual business or trade of the

employer. Here, private respondent had been a project employee several times over.
His employment ceased to be coterminous with specific projects when he was
repeatedly re-hired due to the demands of petitioner's business. 20 Where from the
circumstances it is apparent that periods have been imposed to preclude the acquisition
of tenurial security by the employee, they should be struck down as contrary to public
policy, morals, good customs or public order.
Further, Policy Instructions No. 20 requires employers to submit a report of an
employee's termination to the nearest public employment office every time his
employment was terminated due to a completion of a project. The failure of the
employer to file termination reports is an indication that the employee is not a project
employee. 22 Department Order No. 19 superseding Policy Instructions No. 20 also
expressly provides that the report of termination is one of the indications of project
employment. 23 In the case at bar, there was only one list of terminated workers
submitted to the Department of Labor and Employment. 24 If private respondent was a
project employee, petitioner should have submitted a termination report for every
completion of a project to which the former was assigned.

5. . JPL Marketing Promotion vs. Court of Appeals, G.R. No. 151966, July 8, 2005
Facts:
Petitioner is the employer of private respondents Gonzales, Abesa and Aninipot. The
three are assigned as attendants in various firms where the products of California
Marketing Corp., one of petitioners clients, are being displayed.
On 13 August 1996, petitioner issued a memorandum to the three employees informing
them that CMC would stop its direct merchandising activity after two days. Petitioner
then advised them to wait for further notice as they would be transferred to other clients.
Without waiting for six months, the three got employed with some other employer.
However, on 17 October 1996, Abesa and Gonzales filed before the National Labor
Relations Commission Regional Arbitration Branch (NLRC) complaints for illegal
dismissal, praying for separation pay, 13th month pay, service incentive leave pay and
payment for moral damages. Aninipot filed a similar case thereafter.
The Labor Arbiter dismissed the complaint. Private respondents appealed to the NLRC
which agreed with the Labor Arbiter's finding that when private respondents filed their
complaints, the six-month period had not yet expired, and that CMC's decision to stop
its operations in the areas was beyond the control of petitioner, thus, there was no
illegal dismissal committed by petitioner.

Aggrieved, petitioner filed a petition for certiorari under Rule 65 of the Rules of Court
with the Court of Appeals, imputing grave abuse of discretion on the part of the NLRC. It
claimed that private respondents are not by law entitled to separation pay, service
incentive leave pay and 13th month pay. The Court of Appeals dismissed the petition
and affirmed in toto the NLRC resolution.
Issue:
Were the private respondents illegally dismissed which would entitle them to claim
separation pay?
Ruling:
The common denominator of the instances where payment of separation pay is
warranted is that the employee was dismissed by the employer. In the instant case,
there was no dismissal to speak of. Private respondents were simply not dismissed at
all, whether legally or illegally. What they received from petitioner was not a notice of
termination of employment, but a memo informing them of the termination of CMC's
contract with petitioner. More importantly, they were advised that they were to be
reassigned. At that time, there was no severance of employment to speak of. In
addition, the doctrine enunciated in the case of Serrano 37 cited by private respondents
has already been abandoned by our ruling in Agabon v. National Labor Relations
Commission. There we ruled that an employer is liable to pay indemnity in the form of
nominal damages to a dismissed employee if, in effecting such dismissal, the employer
failed to comply with the requirements of due process. However, private respondents
are not entitled to the payment of damages considering that there was no violation of
due process in this case.
6. PNCC SKYWAY TRAFFIC MANAGEMENT AND SECURITY DIVISION
WORKERS ORGANIZATION (PSTMSDWO), represented by its President,
RENE SORIANO, Petitioner, v. PNCC SKYWAY CORPORATION, Respondent.
Facts:
Petitioner PNCC Skyway Corporation Traffic Management and Security Division
Workers'
Organization (PSTMSDWO) is a labor union duly registered with the Department of
Labor
and Employment (DOLE). Respondent PNCC Skyway Corporation is a corporation duly
organized and operating under and by virtue of the laws of the Philippines. They
entered

into CBA. Pertinent provisions are as follows:

ARTICLE VIII VACATION LEAVE AND SICK LEAVE
Section 1. Vacation Leave.
[b]The company shall schedule the vacation leave of employees during the year taking
into consideration the request of preference of the employees.

PNCC then created a schedule of leaves for their employees. Petitioner objected to the
implementation of the said memorandum. It insisted that the individual members of the
union have the right to schedule their vacation leave. It opined that the unilateral
scheduling of the employees' vacation leave was done to avoid the monetization of their
vacation leave in December 2004.
Issue: WON the PNCC has the sole discretion to schedule the vacation leaves of its
employees.

Held: PNCC has the sole discretion to schedule the vacation leaves of its employees.
The rule is that where the language of a contract is plain and unambiguous, its
meaning should be determined without reference to extrinsic facts or aids. The intention
of the parties must be gathered from that language, and from that language alone.
Stated differently, where the language of a written contract is clear and unambiguous,
the contract must be taken to mean that which, on its face, it purports to mean, unless
some good reason can be assigned to show that the words used should be understood
in a different sense.
In the case at bar, the contested provision of the CBA is clear and unequivocal. Article
VIII,
Section 1 (b) of the CBA categorically provides that the scheduling of vacation leaves ha
ll
be under the option of the employer. Thus, if the terms of a CBA are clear and leave no
doubt upon the intention of the contracting parties, the literal meaning of its stipulation
shall prevail. In fine, the CBA must be strictly adhered to and respected if its ends have
to be achieved, being the law between the parties. In Faculty Association of Mapua
Institute of Technology (FAMIT) v. Court of Appeals, this Court held that the CBA during

its life time binds all the parties. The provisions of the CBA must be respected since its
terms and conditions constitute the law between the parties. The parties cannot be
allowed to change the terms they agreed upon on the ground that the same are not
favorable to them.
The purpose of a vacation leave is to afford a laborer a chance to get a much-needed
rest to replenish his worn-out energy and acquire a new vitality to enable him to
efficiently perform his duties, and not merely to give him additional salary and bounty.
Accordingly, the vacation leave privilege was not intended to serve as additional salary,
but as a non-monetary benefit. To give the employees the option not to consume it with
the aim of converting it to cash at the end of the year would defeat the very purpose of
vacation leave.