1.

Construction/ Interpretation in Favor of Labor

In interpreting Labor Code provisions, the workingman’s welfare should be the primordial and
paramount consideration. Article 4 of the Labor Code provides that “all doubts in the
implementation and interpretation of the provisions of the Labor Code including its implementing
rules and regulations shall be resolved in favor of labor.

Thus in the case of EASTERN SHIPPING LINES vs. POEA, the Supreme Court
pronounced that:

“Whatever doubts may still remain regarding the rights of the parties in this
case are resolved in favor of the private respondent, in line with the express
mandate of the Labor Code and the principle that those with less in life should
have more in law. When the conflicting interests of labor and capital are weighed
on the scales of social justice, the heavier influence of the latter must be counter-
balanced by the sympathy and compassion the law must accord the
underprivileged worker. This is only fair if he is to be given the opportunity and
the right to assert and defend his cause not as a subordinate but as a peer of
management, with which he can negotiate on even plane. Labor is not a mere
employee of capital but its active and equal partner.”(EASTERN SHIPPING LINES
vs. POEA G.R. NO. 76633 OCT. 18, 1988)

2. Doctrine of Compassionate Justice

Under this principle, the Supreme Court said that:

“Social justice policy mandates a compassionate attitude toward working class in

its relation to management. In calling for the protection to labor, the Constitution does
not condone wrongdoing by the employee, it nevertheless urges a moderation of the
sanctions that may be applied.” (Gandara Mill Supply vs. NLRC)

In another case, the Supreme Court held that

“An employee who is dismissed for cause is generally not entitled to any financial
assistance. Equity considerations, however, provide an exception. Equity has been
defined as justice outside law, being ethical rather than jural and belonging to the sphere
of morals than of law. It is grounded on the precepts of conscience and not on any
sanction of positive law, for equity finds no room for application where there is law.”
(Aparente, Sr. v. National Labor Relations Commission, G.R. No. 117652, 27 April 2000)

In Philippine Long Distance Telephone Company vs. NLRC, et al., the Supreme Court held that
in the case of employees separated from the service for just and valid cause due to ". . . an
offense involving moral turpitude . . . , the employer may not be required to give the dismissed
employee separation pay, or financial assistance, or whatever name it is called, on the ground
of social justice."
 We hold that henceforth separation pay shall be allowed as a measure of social
justice only in those instances where the employee is validly dismissed for
causes other than serious misconduct or those reflecting on his moral character.
Where the reason for the valid dismissal is, for example, habitual intoxication or an
offense involving moral turpitude, like theft or illicit sexual relations with a fellow worker,
the employer may not be required to give the dismissed employee separation pay, or
financial assistance, or whatever other name it is called, on the ground of social justice.

A contrary rule would, as the petitioner correctly argues, have the effect of rewarding
rather than punishing the erring employee for his offense. And we do not agree that the
punishment is his dismissal only and that the separation pay has nothing to do with the
wrong he has committed. Of course it has. Indeed, if the employee who steals from the
company is granted separation pay even as he is validly dismissed, it is not unlikely that
he will commit a similar offense in his next employment because he thinks he can expect
a like leniency if he is again found out. This kind of misplaced compassion is not going to
do labor in general any good as it will encourage the infiltration of its ranks by those who
do not deserve the protection and concern of the Constitution.

The policy of social justice is not intended to countenance wrongdoing simply

because it is committed by the underprivileged. At best it may mitigate the penalty
but it certainly will not condone the offense. Compassion for the poor is an imperative
of every humane society but only when the recipient is not a rascal claiming an
undeserved privilege. Social justice cannot be permitted to be refuge of scoundrels any
more than can equity be an impediment to the punishment of the guilty. Those who
invoke social justice may do so only if their hands are clean and their motives blameless
and not simply because they happen to be poor. This great policy of our Constitution is
not meant for the protection of those who have proved they are not worthy of it, like the
workers who have tainted the cause of labor with the blemishes of their own character.”

3. Principle of Fair Play and Justice as a limitation to company’s Management Prerogative

“Indeed, jurisprudence recognizes the right to exercise management prerogative.

Labor laws also discourage interference with an employer's judgment in the conduct of
its business. For this reason, the Court often declines to interfere in legitimate business
decisions of employers. The law must protect not only the welfare of employees, but also
the right of employers.” (Endico v. Quantum Foods Distribution Center, G.R. No.
161615, January 30, 2009) However, the exercise of management prerogative is not
unlimited. Managerial prerogatives are subject to limitations provided by law, collective
bargaining agreements, and general principles of fair play and justice. (DOLE
Philippines, Inc. v. Pawis ng Makabayang Obrero (PAMAO-NFL), 443 Phil. 143, 149
(2003))