Salafranca Vs Philamlife

11/5/2019 SUPREME COURT REPORTS ANNOTATED VOLUME 300
VOL. 300, DECEMBER 23, 1998 469

Salafranca vs. Philamlife (Pamplona) Village Homeowners
Association, Inc.
*
G.R. No. 121791. December 23, 1998.
ENRIQUE SALAFRANCA, petitioner, vs. PHILAMLIFE

(PAMPLONA) VILLAGE HOMEOWNERS
ASSOCIATION, INC., BONIFACIO DAZO and THE
SECOND DIVISION, NATIONAL LABOR RELATIONS
COMMISSION (NLRC), respondents.
Labor Law; Security of Tenure; The services of an employee

who enjoys the right to security of tenure may be terminated only
for causes provided by law.—On the outset, there is no dispute
that petitioner had already attained the status of a regular
employee, as
__________
* THIRD DIVISION.
470
470 SUPREME COURT REPORTS ANNOTATED

Association, Inc.
evidenced by his eleven years of service with the private

respondent. Accordingly, petitioner enjoys the right to security of
tenure and his services may be terminated only for causes
provided by law.
Same; Dismissals; The substantive and procedural
requirements attendant to dismissal of employees are mandatory
and noncompliance therewith renders any judgment reached by
the management void and inexistent.—Viewed in this light, while
private respondent has the right to terminate the services of
central.com.ph/sfsreader/session/0000016e3a5eb257a20a5e51003600fb002c009e/t/?o=False 1/16
petitioner, this is subject to both substantive and procedural

grounds. The substantive causes for dismissal are those provided
in Articles 282 and 283 of the Labor Code, while the procedural
grounds refer to the observance of the requirement of due process.
In all these instances, it is the private respondent, being the
employer, who must prove the validity of the dismissal. Having
reviewed the records of this case carefully, we conclude that
private respondent utterly failed to substantiate petitioner’s
dismissal, rendering the latter’s termination illegal. At the risk of
being redundant, it must be stressed that these requirements are
mandatory and non-compliance therewith renders any judgment
reached by the management void and inexistent.
Same; Same; Evidence; Affidavits; It is settled that no undue
importance should be given to a sworn statement or affidavit as a
piece of evidence because, being taken ex-parte, an affidavit is
almost always incomplete and inaccurate.—While private
respondent imputes “gross negligence,” and “serious misconduct”
as the causes of petitioner’s dismissal, not a shred of evidence was
offered in support thereof, other than bare and uncorroborated
allegations. The facts and circumstances regarding such alleged
infractions were never explained. While it is true that private
respondent, through its president Bonifacio Dazo, executed an
affidavit narrating the alleged violations of the petitioner, these
were never corroborated by concrete or competent evidence. It is
settled that no undue importance should be given to a sworn
statement or affidavit as a piece of evidence because, being taken
ex-parte, an affidavit is almost always incomplete and inaccurate.
Furthermore, it must be noted that when petitioner was
terminated in 1992, these alleged infractions were never raised
nor communicated to him. In fact, these were only revealed after
the complaint was filed by the petitioner in 1993. Why there was
a delay was never adequately explained by private respondent.
471
VOL. 300, DECEMBER 23, 1998 471

Association, Inc.
Same; Same; Same; Unsubstantiated accusations without

more, are not tantamount to guilt.—Likewise, we note that Dazo
himself was not presented as a witness to give the petitioner an
opportunity to cross-examine him and propound clarificatory
questions regarding matters averred in his affidavit. All told, the
foregoing lapses and the belated submission of the affidavit, cast
doubt as to the credibility of the allegations. In sum, the dismissal
of the petitioner had no factual basis whatsoever. The rule is that
unsubstantiated accusations without more, are not tantamount to

guilt.
Same; Same; Due Process; The essence of due process is to
afford the party an opportunity to be heard and defend himself, to
cleanse his name and reputation from any taint—it includes the
twin requirements of notice and hearing.—The essence of due
process is to afford the party an opportunity to be heard and
defend himself, to cleanse his name and reputation from any
taint. It includes the twin requirements of notice and hearing.
This concept evolved from the basic tenet that one’s employment
or profession is a property right protected by the constitutional
guaranty of due process of law. Hence, an individual’s separation
from work must be founded on clearly-established facts, not on
mere conjectures and suspicions.
Same; Same; Same; Management Prerogatives; A decision to
terminate an employee without fully apprising him of the facts, on
the pretext that the twin requirements of notice and hearing are
unnecessary or useless, is an invalid and obnoxious exercise of
management prerogative.—In light of the foregoing, private
respondent’s arguments are clearly baseless and without merit. In
truth, instead of protecting petitioner’s reputation, private
respondent succeeded in doing exactly the opposite—it condemned
the petitioner without even hearing his side. It is stating the
obvious that dismissal, being the ultimate penalty that can be
meted out to an employee, should be based on a clear or
convincing ground. As such, a decision to terminate an employee
without fully apprising him of the facts, on the pretext that the
twin requirements of notice and hearing are unnecessary or
useless, is an invalid and obnoxious exercise of management
prerogative.
Same; Same; Same; Same; Corporation Law; By-Laws;
Contracts; Non-Impairment Clause; The right to amend the by-
laws by the employer, extensive as it may be, cannot impair the
obligation of existing contracts or rights.—Admittedly, the right to
amend the by-
472

Association, Inc.
laws lies solely in the discretion of the employer, this being in the
exercise of management prerogative or business judgment.
However this right, extensive as it may be, cannot impair the

obligation of existing contracts or rights.
Appeals; Pleadings and Practice; Matters, theories or
arguments not brought out in the proceedings below will
ordinarily not be considered by a reviewing court, as they cannot
be raised for the first time on appeal.—In the proceedings before
the Labor Arbiter, it is noteworthy that private respondent never
raised the issue of compulsory retirement, as a cause for
terminating petitioner’s service. In its appeal before the NLRC,
this ground was never discussed. In fact, private respondent, in
justifying the termination of the petitioner, still anchored its
claim on the applicability of the amended by-laws. This omission
is fatal to private respondent’s cause, for the rule is well-settled
that matters, theories or arguments not brought out in the
proceedings below will ordinarily not be considered by a reviewing
court, as they cannot be raised for the first time on appeal.
SPECIAL CIVIL ACTION in the Supreme Court.

Certiorari.
The facts are stated in the opinion of the Court.

Claro F. Certeza for petitioner.
Gregorio D. David for private respondents.
ROMERO, J.:
Petitioner Enrique Salafranca started working with the

private respondent Philamlife Village Homeowners
Association on May 1, 1981 as administrative officer for a
period of six months. From this date until December 31,
1983, petitioner
1
was reappointed to his position three more
times. As administrative officer, petitioner was generally
responsible2
for the management of the village’s day to day
activities. After petitioner’s term of employment expired on
December 31,
___________
1 Annexes “B,” “C,” “D” of Petition, pp. 26-29.

2 Ibid., p. 59.
473
VOL. 300, DECEMBER 23, 1998 473

Association, Inc.
1983, he still continued to work in the same capacity,

albeit, without the benefit of a renewed contract.
Sometime in 1987, private respondent decided to amend
its by-laws. Included therein was a provision regarding
officers, specifically, the position of administrative officer
under which said officer shall hold office at the pleasure of
the Board of Directors. In view of this development, private
respondent, on July 3, 1987, informed the petitioner that
his term of office shall be coterminus with the Board of
Directors which appointed him to his position.
Furthermore, until be submits a medical certificate
showing his state of health,
3
his employment shall be on a
month-to-month basis. Oddly, notwithstanding the failure
of herein petitioner to submit his medical certificate, he
continued
4
working until his termination in December
1992. Claiming that his services had been unlawfully and
unceremoniously dispensed with, petitioner filed a
complaint5 for illegal dismissal with money claims and for
damages.
After the submission by the parties of their respective
position papers and 6
other pleadings, the Labor Arbiter
rendered a decision ordering private respondent to pay the
petitioner the amount of P257,833.33 representing his
backwages, separation pay and 13th month pay. In
justifying the award, the Labor Arbiter elucidated:
“Respondents’ contention that complainant’s term of employment

was co-terminus with the term of Office of the Board of Directors,
is wanting in merit. Records show that complainant had been
hired in 1981 while the Amendment of the respondents’ By-Laws
making the position of an Administrative Officer co-terminus with
the term of the Board of Directors was made in 1987. Evidently,
the said Amendment would not be applicable to the case of
complainant who had become a regular employee long time before
the Amend-
___________
3 Id., p. 61.
4 Id., p. 30.
5 Id., pp. 35-36.
6 Id., pp. 137-144.
474

Association, Inc.
ment took place. Moreover, the Amendment should be applied

prospectively and not retroactively.”
On appeal by the private respondent, the NLRC reversed7

the decision of the Labor Arbiter and rendered a new one
reducing petitioner’s monetary award to only one-half (1/2)
month pay for every year of service representing his
retirement pay. In other words, the NLRC viewed the
dismissal of the petitioner as a valid act by the private
respondent.
“The fact that he continued to perform the function of the office of

administrative officer without extension or re-appointment
thereafter, to our mind, did not in any way make his employment
permanent as in fact, he was even reminded of the nature of his
position by then president of the association Jaime Y. Ladao in a
letter of 3 July 1987. His reply to the aforesaid letter, claiming his
employment regular, and viz a viz, referring to submit his medical
certificate, notwithstanding, to our mind, merely underscored the
need to define his position as, in fact, the Association’s Rules and
Regulations were amended if but to put to rest the tenural (sic)
limit of the office of the Administrative Officer in accordance with
its earlier intention, that it is co-terminus with that of the
members of the Board of Directors.
WHEREFORE, the decision appealed from is hereby set aside.
Respondents are hereby ordered to pay herein appellee one half
(1/2) month pay for every year of service representing his
retirement pay.”
In view of the sudden turn of events, petitioner has

elevated
8
the case to this Court assigning the following
errors:
1. The NLRC gravely abused its discretion when it ruled

that the employment of the Petitioner is not purely based
on considerations of Employer-Employee relationship.
2. Petitioner was illegally dismissed by private respondents.
__________
7 Rollo, pp. 174-186.

8 Id., p. 10.
475
VOL. 300, DECEMBER 23, 1998 475

Association, Inc.
As to the first assigned error by the petitioner, we need not

dwell on this at length. We agree with the Solicitor
General’s observation that an employer-employee
relationship9 exists between the petitioner and the private
respondent.
“x x x x x x x x x
The first element is present in this case. Petitioner was hired
as Administrative Officer by respondents. In fact, he was
extended successive appointments by respondents.
The second element is also present since it is not denied that
respondent PVHA paid petitioner a fixed salary for his services.
As to the third element, it can be seen from the Records that
respondents had the power of dismissal over petitioner. In their
letter dated December 7, 1992, respondents informed petitioner
that they had decided to discontinue his services. In their Position
Paper submitted to the Labor Arbiter, respondents stated that
petitioner ‘was dismissed for cause.’ (p. 17, Record).
With respect to the fourth and most important element,
respondents controlled the work of petitioner not only with
respect to the ends to be achieved but also the means used in
reaching such ends.”
Relative to the second assigned error of the petitioner, both

the Solicitor General and the private respondent10take the
stance that petitioner was not illegally dismissed. On this
aspect, we disagree with their contentions.
On the outset, there is no dispute that petitioner had
already attained the status of a regular employee, as
evidenced by his eleven years of service with the private
respondent. Accordingly,
11
petitioner enjoys the right to
security of tenure and his 12services may be terminated only
for causes provided by law.
__________
9 Comment, Rollo, pp. 254-255.

10 Id., p. 255.
11 Philippine School of Business Administration (PSBA)-Manila v.
NLRC, 261 SCRA 189 (1996).
12 San Miguel Jeepney Service v. NLRC, 265 SCRA 38 (1996).
476

Association, Inc.
Viewed in this light, while private respondent has the right

to terminate the services of petitioner, 13this is subject to
both substantive and procedural grounds. The substantive
causes for dismissal are
14
those provided in Articles 282 and
283 of the Labor Code, while the procedural grounds 15
refer
to the observance of the requirement of due process. In all
these in-
__________
13 Manuel v. N.C. Construction Supply, 282 SCRA 326 (1997); Shoppers

Gain Supermart v. NLRC, 259 SCRA 411 (1996).
14 ART. 282. Termination by employer.—An employer may terminate an
employment for any of the following causes:
(a) Serious misconduct or willful disobedience by the employee of the

lawful orders of his employer or representative in connection with
his work;
(b) Gross and habitual neglect by the employee of his duties;
(c) Fraud or willful breach by the employee of the trust reposed in
him by his employer or duly authorized representative;
(d) Commission of a crime or offense by the employee against the
person of his employer or any immediate member of his family or
his duly authorized representative; and
(e) Other causes analogous to the foregoing.
ART. 283. Closure of establishment and reduction of personnel.—The

employer may also terminate the employment of any employee due to the
installation of labor saving devices, redundancy, retrenchment to prevent
losses or the closing or cessation of operation of the establishment or
undertaking unless the closing is for the purpose of circumventing the
provisions of this Title, by serving a written notice on the workers and the
Ministry of Labor and Employment at least one (1) month before the
intended date thereof. In case of termination due to the installation of
labor saving devices or redundancy, the worker affected thereby shall be
entitled to a separation pay equivalent to at least his one (1) month pay or
to at least one (1) month pay for every year of service, whichever is higher.
In case of retrenchment to prevent losses and in cases of closures or
cessation of operations of establishment or undertaking not due to serious
business losses or financial reverses, the separation pay shall be
equivalent to one (1) month pay or at least one-half (1/2) month pay for
every year of service, whichever is higher. A fraction of at least six (6)
months shall be considered one (1) whole year.
15 Brahm v. NLRC, 280 SCRA 828 (1997); Jamer v. NLRC, 278 SCRA
632 (1997).
477
VOL. 300, DECEMBER 23, 1998 477

Association, Inc.
stances, it is the private respondent, being 16the employer,

who must prove the validity of the dismissal.
Having reviewed the records of this case carefully, we
conclude that private respondent utterly failed to
substantiate petitioner’s dismissal, rendering the latter’s
termination illegal. At the risk of being redundant, it must
be stressed that these requirements are mandatory and
non-compliance therewith renders any 17judgment reached
by the management void and inexistent.
While private respondent imputes “gross negligence,”
and “serious
18
misconduct” as the causes of petitioner’s
dismissal, not a shred of evidence was offered in support
thereof, other than bare and uncorroborated allegations.
The facts and circumstances regarding such alleged
infractions were never explained. While it is true that
private respondent, through its president Bonifacio Dazo,
executed an 19
affidavit narrating the alleged violations of the
petitioner, these were never corroborated by concrete or
competent evidence. It is settled that no undue importance
should be given to a sworn statement or affidavit as a piece
of evidence because, being taken ex-parte, 20
an affidavit is
almost always incomplete and inaccurate. Furthermore, it
must be noted that when petitioner was terminated in
1992, these alleged infractions were never raised nor
communicated to him. In fact, these were only revealed
after the complaint was filed by the petitioner in 1993. Why
there was a delay was never adequately explained by
private respondent.
Likewise, we note that Dazo himself was not presented
as a witness to give the petitioner an opportunity to cross-
examine him and propound clarificatory questions
regarding matters averred in his affidavit. All told, the
foregoing lapses and the
___________
16 Sanyo Travel Corporation v. NLRC, 280 SCRA 129 (1997).

17 Pepsi Cola Bottling Co. v. NLRC, 210 SCRA 277 (1992).
18 Comment, Rollo, p. 189.
19 Rollo, pp. 73-77.
20 People v. Ragay, 277 SCRA 106 (1997).
478

Association, Inc.
belated submission of the affidavit, cast doubt as to the

credibility of the allegations. In sum, the dismissal of the
petitioner had no factual basis whatsoever. The rule is that
unsubstantiated accusations
21
without more, are not
tantamount to guilt.
As regards the issue of procedural due process, private
respondent justifies its non-compliance therewith in this
wise:
“The Association Officers, being his peers and friends had a

problem however in terminating his services. He had been found
to have committed infractions as previously enumerated. PVHA
could have proceeded with a full-blown investigation to hear these
charges, but the ordeal might break the old man’s heart as this
will surely affect his standing in the community. So they decided
to make their move as discreetly (but legally) as possible to save
the petitioner’s reputation. Terminating him in accordance with
the provision of the by-laws of the Association without pointing
out his numerous faults and malfeasance in office and with one-
half month pay for every year of service in accordance with the
Retirement Law was the best and only alternative.”
We are not impressed. The reasoning advanced by the

private respondent is as puerile as it is preposterous.
The essence of due process is to afford the party an
opportunity to be heard and defend himself, to cleanse his
name and reputation from any taint. 22
It includes the twin
requirements of notice and hearing. This concept evolved
from the basic tenet that one’s employment or profession is
a property right protected
23
by the constitutional guaranty of
due process of law. Hence, an individual’s separation from
work must be founded on clearly-established
24
facts, not on
mere conjectures and suspicions.
____________
21 RDS Trucking v. NLRC, G.R. No. 123491, August 27, 1998.

22 MGG Marine Services, Inc. v. NLRC, 259 SCRA 664 (1996).
23 JMM Production and Management, Inc. v. Court of Appeals, 260
SCRA 319 (1996).
24 Philippine Long Distance Telephone Company v. NLRC, 276 SCRA 1
(1997).
479
VOL. 300, DECEMBER 23, 1998 479

Association, Inc.
In light of the foregoing, private respondent’s arguments

are clearly baseless and without merit. In truth, instead of
protecting petitioner’s reputation, private respondent
succeeded in doing exactly the opposite—it condemned the
petitioner without even hearing his side. It is stating the
obvious that dismissal, being the ultimate penalty that can
be meted out to an 25employee, should be based on a clear or
convincing ground. As such, a decision to terminate an
employee without fully apprising him of the facts, on the
pretext that the twin requirements of notice and hearing
are unnecessary or useless, is an invalid and obnoxious
exercise of management prerogative.
Furthermore, private respondent, in an effort to validate
the dismissal of the petitioner, posits the theory that the
latter’s position is coterminus with that of the Village’s
Board26 of Directors, as provided for in its amended by-
laws.
Admittedly, the right to amend the by-laws lies solely in
the discretion of the employer, this being in the exercise of
management prerogative or business judgment. However
this right, extensive as it may be, cannot impair the
obligation of existing contracts or rights.
Prescinding from these premises, private respondent’s
insistence that it can legally dismiss petitioner on the
ground that his tenure has expired is untenable. To
reiterate, petitioner, being a regular employee, is entitled
to security of tenure; hence, his services 27may only be
terminated for causes provided by law. A contrary
interpretation would not find justification in the laws or
the Constitution. If we were to rule otherwise, it would
enable an employer to remove any employee from his
employment by the simple expediency of amending its by-
laws and providing that his/her position shall cease to exist
upon the occurrence of a specified event.
____________
25 Pantranco North Express, Inc. v. NLRC, 252 SCRA 237 (1996).

26 Rollo, p. 60.
27 Article XIII, Section 3 of the 1987 Constitution; San Miguel Jeepney
Services v. NLRC, 265 SCRA 35 (1996).
480

Association, Inc.
If private respondent wanted to make the petitioner’s

position co-terminus with that of the Board of Directors,
then the amendment must be effective after petitioner’s
stay with the private respondent, not during his term.
Obviously, the measure taken by the private respondent in
amending its by-laws is nothing but a devious, but crude,
attempt to circumvent petitioner’s right to security of
tenure28 as a regular employee guaranteed under the Labor
Code.
Interestingly, the Solicitor General is of the view that
what actually transpired was that petitioner was retired
from his employment, considering the fact that 29
in 1992 he
was already 70 years old and not terminated.
While there seems to be a semblance of plausibility in
this contention for the matter of extension of service of such
employee or official is addressed to the sound discretion of
the employer, still we have no doubt that this was just a
mere afterthought—a dismissal disguised as retirement.
In the proceedings before the Labor Arbiter, it is
noteworthy that private respondent
30
never raised the issue
of compulsory retirement, as a cause for terminating
petitioner’s service. In its appeal before the NLRC, this
ground was never discussed. In fact, private respondent, in
justifying the termination of the petitioner, still anchored
its claim on the applicability of the amended by-laws. This
omission is fatal to private respondent’s cause, for the rule
is well-settled that matters, theories or arguments not
brought out in the proceedings below will ordinarily not be
considered by a reviewing 31court, as they cannot be raised
for the first time on appeal.
Undaunted, private respondent now 32
asserts that the
instant petition was filed out of time, considering that the
assailed NLRC decision was received on June 28, 1995
while
__________
28 Article 279, Labor Code, as amended.

29 Memorandum, Rollo, pp. 362-363.
30 Position Paper, Rollo, pp. 66-71.
31 Philippine Airlines, Inc. v. NLRC, 259 SCRA 459 (1996).
32 Rollo, p. 194.
481
VOL. 300, DECEMBER 23, 1998 481

Association, Inc.
this petition was filed on September 20, 1995. At this

juncture, we take this opportunity to state that under the
1997 Rules of Civil Procedure, a petition for certiorari must
now be instituted within sixty days 33 of receipt of the
assailed judgment, order or resolution. However, since
this case arose in 1995 and the aforementioned rule only
took effect on July 1, 1997 then the old rule is applicable.
Since prior to the effectivity of the new rule, a special civil
action of certiorari
34
should be instituted within a period of
three months, the instant petition which was filed on
September 20, 1995 or two months and twenty-two days
thereafter, was still within the reglementary period.
With respect to the issue of the monetary award to be
given to the petitioner, private respondent argues that he
deserves only retirement pay and nothing more. This
position would have been tenable had petitioner not been
illegally dismissed. However, since we have already ruled
petitioner’s dismissal as without just cause and lacking due
process,35 the award of backwages and reinstatement is
proper.
In this particular case, reinstatement is no longer
feasible since petitioner was already 70 years old at the
time he was removed from his employment. As 36
a substitute
thereof, separation pay is generally awarded, the amount
of which must 37be equivalent to one-month salary for every
year of service.
With respect to the amount of backwages 38
which,
incidentally is different from separation pay, it is now
settled that
___________
33 Sec. 4, Rule 65, 1997 Rules of Civil Procedure.

34 People’s Security, Inc. v. NLRC, 226 SCRA 146 (1993); PAL
Employees Savings and Loan Association, Inc. v. NLRC, 260 SCRA 758
(1996).
35 Judy Philippines, Inc. v. NLRC, G.R. No. 111934, April 29, 1998.
36 Escobin, et al. v. NLRC, G.R. No. 118159, April 15, 1998.
37 International Pharmaceuticals, Inc. v. NLRC, G.R. No. 106331,
March 9, 1998; Iriga Telephone Company, Inc. v. NLRC, G.R. No. 119420,
February 27, 1998.
38 Indophil Acrylic Mfg. Corp. v. NLRC, 226 SCRA 723 (1993).
482

Association, Inc.
an illegally dismissed employee is entitled to its full

payment 39as long as the cause of action accrued after March
21, 1989. Considering that petitioner was terminated from
the service on December 9, 1992, which is after March 21,
1989, he is entitled to full backwages from the time of40the
illegal dismissal without any qualification or deduction.
As regards the issue of retirement pay, private
respondent asserts that the correct amount should be one-
half (1/2) month salary for every year of service. This time
we agree with private respondent’s contention. The
pertinent law is Article 287 of the Labor Code, as amended
by Republic Act No. 7641, which reads:
“Art. 287. 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 employee’s 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 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.
x x x x x x x x x.”
__________
39 Highway Copra Traders v. NLRC, G.R. No. 108889, July 30, 1998;
Ala Mode Garments, Inc. v. NLRC, 268 SCRA 497 (1997).
40 Bustamante v. NLRC, 265 SCRA 61 (1996); Lopez v. NLRC, G.R. No.
124548, October 8, 1998.
483
VOL. 300, DECEMBER 23, 1998 483

Association, Inc.
With respect to the issue that petitioner, being a

managerial employee, is not entitled to thirteenth month
pay, Memorandum Order No. 28, as implemented by the
Revised Guidelines on the Implementation of the 13th
Month Pay Law dated November 16, 1987, provides:
“Section 1 of Presidential Decree No. 851 is hereby modified to the

extent that all employers are hereby required to pay all their rank
and file employees a 13th month pay not later than December 24
of every year.”
Clearly, therefore, the foregoing exempts managerial

employees from this benefit. Of course, this does not
preclude an employer from granting other bonuses, in lieu
of the 13th month pay, to managerial employees in its
discretion.
Finally, we cannot simply ignore private respondent’s
malicious scheme to remove petitioner from his position
which is contrary to good customs and effected in an
oppressive manner, thus warranting an41award of moral
and exemplary damages to the petitioner. Moreover, since
petitioner was forced to litigate and incur expenses to
protect
42
his right and interests, he is entitled to attorney’s
fees.
WHEREFORE, in view of the foregoing, the instant
petition is GRANTED. The NLRC decision dated June 15,
1995 is hereby REVERSED and SET ASIDE. Private
respondent Philamlife Village Homeowners Association is
ORDERED: (1) to pay petitioner Enrique Salafranca
separation pay equivalent to one month salary for every
year of service; (2) to pay his full backwages
43
in accordance
with our ruling in Bustamante v. NLRC; (3) to pay his
retirement pay in accordance with Article 287 of the Labor
Code, as amended by Republic Act No. 7641; (4) to pay
moral and exemplary damages in the amount of twenty
thousand (P20,000.00) pesos
__________
41 Zamboanga City Electric Cooperative, Inc. v. NLRC, 243 SCRA 47

(1995); Lopez v. Javier, 252 SCRA 68 (1996).
42 Rasonable v. NLRC, 253 SCRA 623 (1996).
43 Supra, note 40.
484

Magos vs. National Labor Relations Commission
44
and ten thousand (P10,000.00) pesos, respectively; and (5)
to pay ten (10%) percent of the total amount due to
petitioner, as attorney’s fees. Consequently, the respondent
NLRC is ORDERED to COMPUTE the total monetary
benefits awarded in accordance with this decision and to
submit its compliance thereon within thirty (30) days from
notice of this decision.
SO ORDERED.
Kapunan, Purisima and Pardo, JJ., concur.
Petition granted, judgment reversed and set aside.
Notes.—While it is true that security of tenure is a

constitutionally guaranteed right of the employees, it does
not, however, mean perpetual employment for the
employee. (Philippine Village Hotel vs. National Labor
Relations Commission, 230 SCRA 423 [1994])
Accusation is not synonymous with guilt. (People vs.
Cruz, 231 SCRA 759 [1994])
——o0o——
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Salafranca Vs Philamlife

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Salafranca Vs Philamlife

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11/5/2019 SUPREME COURT REPORTS ANNOTATED VOLUME 300

VOL. 300, DECEMBER 23, 1998 469

ENRIQUE SALAFRANCA, petitioner, vs. PHILAMLIFE

Labor Law; Security of Tenure; The services of an employee

470 SUPREME COURT REPORTS ANNOTATED

Salafranca vs. Philamlife (Pamplona) Village Homeowners

evidenced by his eleven years of service with the private

petitioner, this is subject to both substantive and procedural

VOL. 300, DECEMBER 23, 1998 471

Salafranca vs. Philamlife (Pamplona) Village Homeowners

Same; Same; Same; Unsubstantiated accusations without

unsubstantiated accusations without more, are not tantamount to

472 SUPREME COURT REPORTS ANNOTATED

Salafranca vs. Philamlife (Pamplona) Village Homeowners

However this right, extensive as it may be, cannot impair the

SPECIAL CIVIL ACTION in the Supreme Court.

The facts are stated in the opinion of the Court.

Petitioner Enrique Salafranca started working with the

1 Annexes “B,” “C,” “D” of Petition, pp. 26-29.

VOL. 300, DECEMBER 23, 1998 473

1983, he still continued to work in the same capacity,

“Respondents’ contention that complainant’s term of employment

474 SUPREME COURT REPORTS ANNOTATED

ment took place. Moreover, the Amendment should be applied

On appeal by the private respondent, the NLRC reversed7

“The fact that he continued to perform the function of the office of

In view of the sudden turn of events, petitioner has

1. The NLRC gravely abused its discretion when it ruled

7 Rollo, pp. 174-186.

VOL. 300, DECEMBER 23, 1998 475

As to the first assigned error by the petitioner, we need not

Relative to the second assigned error of the petitioner, both

9 Comment, Rollo, pp. 254-255.

476 SUPREME COURT REPORTS ANNOTATED

Viewed in this light, while private respondent has the right

13 Manuel v. N.C. Construction Supply, 282 SCRA 326 (1997); Shoppers

(a) Serious misconduct or willful disobedience by the employee of the

ART. 283. Closure of establishment and reduction of personnel.—The

VOL. 300, DECEMBER 23, 1998 477

stances, it is the private respondent, being 16the employer,

16 Sanyo Travel Corporation v. NLRC, 280 SCRA 129 (1997).

478 SUPREME COURT REPORTS ANNOTATED

belated submission of the affidavit, cast doubt as to the

“The Association Officers, being his peers and friends had a

We are not impressed. The reasoning advanced by the

21 RDS Trucking v. NLRC, G.R. No. 123491, August 27, 1998.

VOL. 300, DECEMBER 23, 1998 479

In light of the foregoing, private respondent’s arguments

25 Pantranco North Express, Inc. v. NLRC, 252 SCRA 237 (1996).

480 SUPREME COURT REPORTS ANNOTATED

If private respondent wanted to make the petitioner’s

28 Article 279, Labor Code, as amended.

VOL. 300, DECEMBER 23, 1998 481

this petition was filed on September 20, 1995. At this

33 Sec. 4, Rule 65, 1997 Rules of Civil Procedure.

482 SUPREME COURT REPORTS ANNOTATED

an illegally dismissed employee is entitled to its full

“Art. 287. Retirement.—Any employee may be retired upon

VOL. 300, DECEMBER 23, 1998 483

With respect to the issue that petitioner, being a

“Section 1 of Presidential Decree No. 851 is hereby modified to the

Clearly, therefore, the foregoing exempts managerial

41 Zamboanga City Electric Cooperative, Inc. v. NLRC, 243 SCRA 47