The decision to suspend petitioner was rendered after investigation and a

finding by respondent that petitioner has indeed made malicious statements against
a co-employee. The suspension was imposed due to a repeated infraction within a
deactivation period set by the company relating to a previous similar offense
committed. It is axiomatic that appropriate disciplinary sanction is within the
purview of management imposition.[36] What should not be overlooked is the
prerogative of an employer company to prescribe reasonable rules and regulations
necessary for the proper conduct of its business and to provide certain disciplinary
measures in order to implement said rules to assure that the same would be complied
with.[37] Respondent then acted within its rights as an employer when it decided to
exercise its management prerogative to impose disciplinary measure on its erring
employee.

As a just cause for dismissal of an employee under Article 282[41] of the Labor
Code, willful disobedience of the employers lawful orders requires the
concurrence of two elements: (1) the employees assailed conduct must have
been willful, i.e., characterized by a wrongful and perverse attitude; and (2) the
order violated must have been reasonable, lawful, made known to the
employee, and must pertain to the duties which he had been engaged to
discharge.[42] Both requisites are present in the instant case. It is noteworthy that
upon receipt of the notice of suspension, petitioner did not question such order
at the first instance. He immediately defied the order by reporting on the first day
of his suspension. Deliberate disregard or disobedience of rules by the employee
cannot be countenanced. It may encourage him to do even worse and will render
a mockery of the rules of discipline that employees are required to observe.
Petitioner was served the first notice of termination and was given time to
submit his written explanation. A hearing was conducted wherein both parties
with their respective counsels were present. After finding cause for petitioners
termination, a final notice apprising him of the decision to terminate his
employment was served. All things considered, respondent validly dismissed
petitioner for cause after complying with the procedural requirements of the law.
ARENO JR. VS. SKYCABLE PCC BAGUIO, GRN 180302, FEB 5, 2010

X----------------------------------------------------------------------------------------------------------------------X

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. 37

1
 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 management’s
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
company’s 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. 52

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. 56

MANSION PRINTING CENTER VS. DIOSDADO BITARA, JR, G.R. No.

168120, January 25, 2012
x---------------------------------------------------------------------------x
It is true that an employer is given a wide latitude of discretion in managing its own affairs.
The broad discretion includes the implementation of company rules and regulations and the
imposition of disciplinary measures on its employees. But the exercise of a management
prerogative like this is not limitless, but hemmed in by good faith and a due consideration of
the rights of the worker.24 In this light, the management prerogative will be upheld for as long
as it is not wielded as an implement to circumvent the laws and oppress labor.25

To us, dismissal should only be a last resort, a penalty to be meted only after all the relevant
circumstances have been appreciated and evaluated with the goal of ensuring that the
ground for dismissal was not only serious but true. The cause of termination, to be lawful,
must be a serious and grave malfeasance to justify the deprivation of a means of livelihood.
This requirement is in keeping with the spirit of our Constitution and laws to lean over
backwards in favor of the working class, and with the mandate that every doubt must be
resolved in their favor.26

Although we recognize the inherent right of the employer to discipline its employees, we
should still ensure that the employer exercises the prerogative to discipline humanely and
considerately, and that the sanction imposed is commensurate to the offense involved and to
the degree of the infraction. The discipline exacted by the employer should further consider
the employee’s length of service and the number of infractions during his employment.27The
employer should never forget that always at stake in disciplining its employee are not only
his position but also his livelihood,28 and that he may also have a family entirely dependent
on his earnings.29

2
NATHANIEL N. DONGON, PETITIONER,
vs.
RAPID MOVERS AND FORWARDERS CO., INC G.R. No. 163431 August 28,
2013

x----------------------------------------------------------------x
An employee’s propensity to commit repetitious infractions evinces wrongful intent, making
him undeserving of the compassion accorded by law to labor.

Petitioner’s violation of company rules was intentional, willful, serious and a just cause for
dismissal.

Petitioner assails the CA’s finding that petitioner’s non-issuance of a passenger ticket to the
lady passenger is a grave offense, that it was committed with deliberate intent and a repeat
violation of a company rule which merits dismissal. Petitioner insists that his infraction was
merely trivial because he was under the impression that immediate family members of
employees are entitled to free ride. Petitioner cites Section 13, Article VIII21 of the Collective
Bargaining Agreement which provides:

Section 13. Free Ride and Passes - All employees covered by this Agreement shall be
provided a free ride in all units of Philippine Rabbit Bus Line, Inc. as presently practiced.
However, members of his/her immediate family shall be given passes upon request to the
COMPANY.

Petitioner insists that his act of extending a free ride is in accordance with the aforequoted
provision and the fact that he may have overlooked the requirement of passes with respect
to immediate family members is not so serious as to characterize the offense he committed
to have been performed with malicious intent.

We are not persuaded.

The above provision is clear and unequivocal that free rides are available only to employees
of PRBLI. The benefit is not automatically extended to members of the employee’s
immediate family as passes must first be requested for them. Petitioner should be
conversant of this provision considering his previous infractions of this same provision for
which he was duly penalized. Besides, petitioner’s claim of good faith is belied by his
testimony to the effect that he extended a free ride out of gratitude to the wife of a co-
employee who assisted him in his financial troubles. During the administrative investigation
conducted on October 15, 2001, petitioner narrated thus:

Q-9 Why on October 07 you [gave] a free ride to the wife of Driver Ricardo?

A-9 I did this because I want to pay my gratitude to her, sir.

Q-10 What are your gratitude/s to the woman?

A-10 Many times she [helped] me in my problem especially in financial, sir.

Q-11 Why [do] you need to pay your gratitude [at] the expense of the company?

A-11 For what I have done compel [sic] myself to do. Napasubo lang po ako. I admit
this is a grave offense against the company. Whatever suspension that you may
impose to [sic] me I am ready to accept, sir.22

Based on this testimony, it is quite apparent that petitioner was aware that the infraction he
committed constituted a grave offense but he still persisted in committing the same out of
gratitude to the passenger. Hence, as correctly found by the CA, there was deliberate intent
on the part of the petitioner to commit the violation in order to repay a personal debt at the
expense of the company. Petitioner chose to violate company rules for his benefit without
regard to his responsibilities to the company. Also, if not for the inspector who discovered the
incident, the company would have been defrauded by the amount of fare.

3
It bears stressing that petitioner has been in the employ of PRBLI for more

than eight years already and is a member of the company’s labor union. As such, he ought to
know the specific company rules pertaining to his line of work as a bus conductor. For that
matter, his length of service has even aggravated the resulting consequences of his
transgressions. In addition, on April 8, 1994 and May 3, 1995, he committed similar
infractions of extending free ride to a police officer and a former employee, respectively.
These had been brought to the attention of the petitioner and for which the penalties of relief
from duty and suspension were meted out upon him.23 Hence, he ought to have known better
than to repeat the same violation as he is presumed to be thoroughly acquainted with the
prohibitions and restrictions against extending free rides. We also cannot agree with
petitioner’s contention that his infraction was trivial. As a bus conductor whose duties
primarily include the collection of transportation fares, which is the lifeblood of the PRBLI,
petitioner should have exercised the required diligence in the performance thereof and his
habitual failure to exercise the same cannot be taken for granted. As correctly observed by
the CA, petitioner’s position is imbued with trust and confidence because it involves handling
of money and failure to collect the proper fare from the riding public constitutes a grave
offense which justifies his dismissal. Moreover, petitioner’s "series of irregularities when put
together may constitute serious misconduct."24

Petitioner’s record of offenses of the same nature as his present infraction justifies his
dismissal.

Petitioner’s past infractions can be gleaned from his employment record of offenses which
was presented by the respondents. This piece of evidence was not disputed by petitioner.
Hence, petitioner cannot claim that the finding of his past company infractions was based
merely on allegations.

As petitioner’s employment record shows, this is not the first time that

petitioner refused to collect fares from passengers. In fact, this is already the third instance
that he failed to collect fares from the riding public. Although petitioner already suffered the
corresponding penalties for his past misconduct, those infractions are still relevant and may
be considered in assessing his liability for his present infraction.25 We thus held in Philippine
Rabbit Bus Lines, Inc. v. National Labor Relations Commission26that:

Nor can it be plausibly argued that because the offenses were already given the appropriate
sanctions, they cannot be taken against him. They are relevant in assessing private
respondent’s liability for the present violation for the purpose of determining the appropriate
penalty. To sustain private respondent’s argument that the past violation should not be
considered is to disregard the warnings previously issued to him. 1avv phi 1

As suspension may not anymore suffice as penalty for the violation done as shown by
petitioner’s disregard of previous warnings and propensity to commit the same infraction over
the years of his employment, and to deter other employees who may be wont to violate the
same company policy, petitioner’s termination from employment is only proper.

JERRY MAPILI, Petitioner,

vs.
PHILIPPINE RABBIT BUS LINES, INC./NATIVIDAD NISCE, G.R. No. 172506 July
27, 2011

x--------------------------------------------------------------------------------x

To begin with, it is well to recognize the Court's discussion in Imasen Philippine

Manufacturing Corp., v. Alcon, 31 on security of tenure viz-a-viz management prerogative, to
wit:

The law and jurisprudence guarantee to every employee security of tenure. This textual and
the ensuing jurisprudential commitment to the cause and welfare of the working class
proceed from the social justice principles of the Constitution that the Court zealously
implements out of its concern for those with less in life. Thus, the Court will not hesitate to

4
strike down as invalid any employer act that attempts to undermine workers' tenurial security.
All these the State undertakes under Article 279 (now Article 293) of the Labor Code which
bar an employer from terminating the services of an employee, except for just or authorized
cause and upon observance of due process.

In protecting the rights of the workers, the law, however, does not authorize the oppression
or self-destruction of the employer. The constitutional commitment to the policy of social
justice cannot be understood to mean that every labor dispute shall automatically be decided
in favor of labor. The constitutional and legal protection equally recognize the employer's
right and prerogative to manage its operation according to reasonable standards and norms
of fair play.

Accordingly, except as limited by special law, an employer is free to regulate, according to

his own judgment and discretion, all aspects of employment, including hiring, work
assignments, working methods, time, place and manner of work, tools to be used, processes
to be followed, supervision of workers, working regulations, transfer of employees, worker
supervision, layoff of workers and the discipline, dismissal and recall of workers. As a
general proposition, an employer has free reign over every aspect of its business, including
the dismissal of his employees as long as the exercise of its management prerogative is
done reasonably, in good faith, and in a manner not otherwise intended to defeat or
circumvent the rights of workers. 32

From the foregoing, the Court is now tasked with the balancing of Camacho's right to
security of tenure and of PJLI's right to terminate erring employees in its exercise of its
management prerogative.

Loss of Trust and

Confidence

Article 282(c) of the Labor Code authorizes the employer to dismiss an employee for
committing fraud or for willful breach of trust reposed by the employer on the employee. Loss
of confidence, however, is never intended to provide the employer with a blank check for
terminating its employeea. 33 "Loss of trust and confidence" should not be loosely applied in
justifying the termination of an employee. Certain guidelines must be observed for the
employer to cite loss of trust and confidence as a ground for termination. Loss of confidence
should not be simulated. It should not be used as a subterfuge for causes which are
improper, illegal, or unjustified. Loss of confidence may not be arbitrarily asserted in the face
of overwhelming evidence to the contrary. It must be genuine, not a mere afterthought to
justify earlier action taken in bad faith."34 For loss of trust and confidence to be valid ground
for termination, the employer must establish that: (1) the employee holds a position of trust
and confidence; and (2) the act complained against justifies the loss of trust and
confidence. 35

The first requisite mandates that the erring employee must be holding a position of trust and
confidence. Loss of trust and confidence is not a one-size- fits-all cause that can be applied
to all employees without distinction on their standing in the work organization. Distinction yet
should be made as to what kind of position of trust is the employee occupying.

The law contemplates two (2) classes of positions of trust. The first class consists
of managerial employees. They are as those who are vested with the power or prerogative to
lay down management policies and to hire, transfer, suspend, layoff, recall, discharge,
assign or discipline employees or effectively recommend such managerial actions. The
second class consists of cashiers, auditors, property custodians, etc. who, in the normal and
routine exercise of their functions, regularly handle significant amounts of money or
property. 36

The question now is: To what classification does Camacho belong?

The parties do not dispute that Camacho was hired by PJLI as AOM of Area 213 which
covered the province of Pangasinan. He was primarily responsible for administering and
controlling the operations of branches in his assigned area, ensuring cost efficiency,
manpower productivity and competitiveneness. He was also responsible for

5
overseeing/monitoring the overall security and integrity in the area, including branch
personnel safety, in coordination with PJLI's Security Services Division.37 In fact, as stated by
the CA, his position required the utmost trust and confidence as it entailed the custody,
handling, or care and protection of PJLI's property.38 Furthermore, as AOM, he was among
those employees authorized to participate in the QTP operations. He was tasked in
overseeing the safe transport and handling of company assets during the said operations.39

Clearly from the foregoing, it can be deduced that Camacho held a managerial position and,
therefore, enjoyed the full trust and confidence of his superiors. As a managerial employee,
he was "bound by more exacting work ethics" and should live up to this high standard of
responsibility."40

The second requisite for loss of confidence as a valid ground for termination is that it must be
based on a willful breach of trust and founded on clearly established facts.

As can be culled from the records of the case, Camacho admitted that he had committed a
breach of trust when he brought along his mother's driver, an unauthorized person, during
the QTP operation, a very sensitive and confidential operation. As explained by PJLI in its
petition for review:

xxx. On a daily basis, each Cebuana Lhuillier Pawnshop branch accepts valuable jewelry
items, among other personal properties, as collaterals for loans extended to its customers
(pawners). When the loans expire without the pawners redeeming their collaterals, the items
are considered foreclosed or rematado. The rematado items are then collected from the
different Cebuana Lhuillier branches within the area by authorized personnel for transport
and deposit to another location. Thus, a single incident of rematado pull-out involves millions
and millions worth of jewelry items. This process of collection of rematado items is so
sensitive and confidential that even the procedure itself is referred to by code, that
is, "QTP operations." The schedule and route of a QTP operation are kept confidential
by the AOM and the Regional Manager until the actual date and only a select group of
area personnel are authorized to join the operation, namely, the AOM, the ATA or in
their absence the Area Cashier, and the Area Driver. Even branch personnel are not privy
to the schedule of the pull-out of their branch's rematado items. These regulations and
procedures are in place for a reason. PJLI has been victimized by highway roberry,
hold-up and hijack incidents in the past.Asit can no longer afford to put its assets and
lives and safety of its employees at risk, Petitioner adopted confidential and stringent rules
on QTP operations.41 [Emphasis and Underscoring supplied]

In order to save himself from the effects of his transgression, Camacho leans on the
argument that his indiscretion was only an oversight and human error on his part and that his
missteps did not result to damage or loss on PJLI.42For this reason, he claims he should not
be penalized with termination from the service.

The Court is not persuaded.

Camacho, as AOM, was a managerial employee. As such, he could be terminated on the

ground of loss of confidence by mere existence of a basis for believing that he had
breached the trust of his employer. Proof beyond reasonable doubt is not required. It
would already be sufficient that there is some basis for such loss of confidence, such
as when the employer has reasonable ground to believe that the concerned employee
is responsible for the purported misconduct and the nature of his participation
therein. This distinguishes a managerial employee from a fiduciary rank-and-file where loss
of trust and confidence, as ground for valid dismissal, requires proof of involvement in the
alleged events in question, and that mere uncorroborated assertion and accusation by the
employer will not be sufficient. 43

In this case, there was such basis. It was established that Camacho had breached PJLI's
trust when he took an unauthorized person with him to the QTP operation which was already
a violation of company existing policy and security protocol. His explanation that his alleged
misdeed was brought about by his poor physical and health condition on that day could not
prevail over two significant details that PJLI pointed out in its petition, to wit:

6
First of all, the Honorable Court of Appeals failed to consider one very important fact---- it
was NOT Respondent nor his personal driver who drove the service vehicle during the QTP
operations. A company driver, more specifically the Area Driver, is assigned to perform this
task, and he is one of only three (3) authorized personnel allowed to be present during a
QTP operation. Xxx. He is NOT authorized to drive the vehicle. He is not expected to
perform any heavy physical work during this procedure. Thus, whether Respondent was
not in his best health condition that day is immaterial. There was no excuse at all for
Respondent to bring his personal driver. As a matter of fact, all that Respondent's
driver did during the May 15, 2012 pull-out of rematado items was to sit back and
watch while the highly-confidential operation was in progress. Clearly, the presence of
Respondent's personal driver was unnecessary, unjustified, and unwarranted.

Secondly, the Honorable Court of Appeals overlooked a very crucial detail in the sequence of
events relating to the instant case. A day prior to the May 15, 2012 QTP operations,
Respondent personal driver was left behind in his (Respondent's) apartment in
Pangasinan while Respondent went through his usual work routine. If he was able to
do this on May 14, 2012, why did he bring his driver to work on May 15,
2012? Assuming he could not leave his driver behind in his apartment, he should have at
least asked the driver to wait in his office until the QTP operations in 13 pawnshop branches
was completed. It is therefore mysterious, highly suspicious in fact, that Respondent had to
bring his driver on the day he was to conduct a highly-critical and confidential operation, a
schedule he himself has pre-determined. 44 [Emphases Supplied]

Simply put, his act was without justification. For this transgression, petitioner PJLI was
placed in a difficult position of withdrawing the trust and confidence that it reposed on
respondent Camacho and eventually deciding to end his employment. "Unlike other just
causes for dismissal, trust in an employee, once lost is difficult, if not impossible, to
regain."45 PJLI cannot be compelled to retain Camacho who committed acts inimical to its
interests. A company has the right to dismiss its employees if only as a measure of self-
protection.46

Finally, although it may be true that PJLI did not sustain damage or loss on account of
Camacho's action, this is not reason enough to absolve him from the consequence of his
misdeed. The fact that an employer did not suffer pecuniary damage will not obliterate the
respondent's betrayal of trust and confidence reposed on him by his employer.47

PJ LHUILLIER, INC., Petitioner

vs.
HECTOR OREIL CIMAGALA CAMACHO, G.R. No. 223073, February 22, 2017

x--------------------------------------------x