LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C 1. ALHAMBRA INDUSTRIES V.

NLRC, 238 SCRA 232 FACTS: On 27 June 1987, petitioner Alhambra Industries, Inc. (ALHAMBRA for brevity), a Filipino cigar and cigarette manufacturing and distribution company, employed private respondent Danilo C. Rupisan as salesman on a six-month probationary basis. From 912 December 1989, ALHAMBRA conducted a surprise audit of the records of Rupisan. He was then called to the Head Office on 3 January 1990 where alleged violations of company rules purportedly committed by him were brought to his attention. On 8 January 1990, Rupisan was placed under a one-month preventive suspension for serious violations of company policies, rules and regulations, as reflected in the results of the surprise audit. On 22 January 1990, Rupisan protested his suspension, reiterating vehement denial of the charges against him and exposing the threat of termination at their meeting of 3 January 1990. He alleges that as of 30 December 1989 the charges against him had become academic when he was given a clearance of all his accountabilities. On 6 February 1990, a day before the end of his suspension, ALHAMBRA wrote Rupisan terminating his services effective 8 February 1990. On 23 March 1990, Rupisan sued ALHAMBRA for illegal dismissal and unpaid wages or commissions. The suit was later amended on 24 April 1990 to include charges of illegal suspension and damages. ISSUE: Whether Rupisan was illegally dismissed by Alhambra? Whether Rupisan was accorded due process when he was terminated? HELD: The Labor Arbiter found valid grounds for the termination of Rupisan due to his violation of the rules and regulations of the Alhambra. The issue regarding the validity of the dismissal no longer needs to be tackled at length since the Labor Arbiters findings shall be binding upon the Court. With regard to the lack of due process, Rupisan did not have a copy of the audit report which was the basis of his termination. Also, he never had the chance to defend himself against the allegations of his employer prior to his termination. Hence, it was found that there was lack of due process. In line with these findings, since there was valid cause for termination, reinstatement is no longer proper. However, damages should be granted due to the lack of due process. WHEREFORE, the petition is GRANTED and the assailed decision of NLRC dated 29 May 1992 is SET ASIDE. The decision of Labor Arbiter Donato G. Quinto, Jr., dated 19 November 1990 is REINSTATED except as to the award of separation pay which is deleted. In addition, petitioner is ordered to pay private respondent Danilo Rupisan P10,000.00 for having been denied procedural due process. __________________________________________________________________ 2. INTERORIENT MARITIME ENTERPRISES V. NLRC, 235 SCRA 268 Facts: The instant petition seeks the reversal and/or modification of the Resolution dated March 30, 1994 of public respondent National Labor Relations Commission dismissing the appeals of petitioners and affirming the decision dated November 16, 1992 of Philippine Overseas Employment Administration (POEA) Administrator Felicisimo C. Joson, This is a claim for death compensation benefits filed by Constancia Pineda as heir of her deceased son, seaman Jeremias Pineda, against Interorient Maritime Enterprises, Inc. and its foreign principal, Fircroft Shipping Corporation and the Times Surety and Insurance Co., Inc. The following facts were found by the POEA Administrator. On September 28, 1989, he finished his contract and was discharged from the port of Dubai for repatriation to Manila; that his flight schedule from Dubai to the Philippines necessitated a stopover at Bangkok, Thailand, and during said stopover he disembarked on his own free will and failed to join the connecting flight to Hongkong with final destination to Manila; that on October 5, 1990, it received a fax transmission from the Department of Foreign Affairs to the effect that Jeremias Pineda was shot by a Thai Officer on duty on October 2, 1989 at around 4:00 P.M.; that the police report submitted to the Philippine Embassy in Bangkok confirmed that it was Pineda who "approached and tried to stab the police sergeant with a knife and that therefore he was forced to pull out his gun and shot Pineda" Petitioner contends that they are not liable to pay any death/burial benefits pursuant to the provisions of Par. 6, Section C. Part II, POEA Standard Format of Employment which state(s) that "no compensation shall be payable in respect of any injury, (in)capacity, disability or death resulting from a willful (sic) act on his own life by the seaman"; that the deceased seaman died due to his own willful (sic) act in attacking a policeman in Bangkok who shot him in self-defense. After the parties presented their respective evidence, the POEA Administrator rendered his decision holding petitioners liable for death compensation benefits and burial expenses. Petitioners appealed the POEA decision to the public respondent. In a Decision dated March 30, 1994, public respondent upheld the POEA. Thus, this recourse to this Court by way of a special civil action for certiorari per Rule 65 of the Rules of Court. Issue: W the petitioners can be held liable for the death of seaman Jeremias Pineda? Held: The petitioners contention that the assailed Resolution has no factual and legal bases is belied by the adoption with approval by the public respondent of the findings of the POEA Administrator, which recites at length the reasons for holding that the deceased Pineda was mentally sick prior to his death and concomitantly, was no longer in full control of his mental faculties. In this instance, seaman Pineda, who was discharged in Dubai, a foreign land, could not reasonably be expected to immediately resort to and avail of psychiatric examination,

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C assuming that he was still capable of submitting himself to such examination at that time, not to mention the fact that when he disembarked in Dubai, he was already discharged and without employment his contract having already run its full term and he had already been put on a plane bound for the Philippines. Such mental disorder became evident when he failed to join his connecting flight to Hongkong, having during said stopover wandered out of the Bangkok airport's immigration area on his own. This Court agrees with the POEA Administrator that seaman Pineda was no longer acting sanely when he attacked the Thai policeman. The report of the Philippine Embassy in Thailand dated October 9, 1990 depicting the deceased's strange behavior shortly before he was shot dead, after having wandered around Bangkok for four days, clearly shows that the man was not in full control of his own self. The POEA Administrator ruled, and this Court agrees, that since Pineda attacked the Thai policeman when he was no longer in complete control of his mental faculties, the aforequoted provision of the Standard Format Contract of Employment exemption the employer from liability should not apply in the instant case. Firstly, the fact that the deceased suffered from mental disorder at the time of his repatriation means that he must have been deprived of the full use of his reason, and that thereby, his will must have been impaired, at the very least. Thus, his attack on the policeman can in no wise be characterized as a deliberate, willful or voluntary act on his part. Secondly, and apart from that, we also agree that in light of the deceased's mental condition, petitioners "should have observed some precautionary measures and should not have allowed said seaman to travel home alone", and their failure to do so rendered them liable for the death of Pineda. Petitioners further argue that the cause of Pineda's death "is not one of the occupational diseases listed by law", and that in the case of De Jesus vs. Employee's Compensation Commission, this Court held that ". . . for the sickness and the resulting disability or death to be compensable, the sickness must be the result of an occupational disease listed under Annex 'A' of the Rules (the Amended Rules on Employee's Compensation) with the conditions set therein satisfied; otherwise, proof must be shown that the risk of contracting the disease is increased by the working conditions." The foreign employer may not have been obligated by its contract to provide a companion for a returning employee, but it cannot deny that it was expressly tasked by its agreement to assure the safe return of said worker. The uncaring attitude displayed by petitioners who, knowing fully well that its employee had been suffering from some mental disorder, nevertheless still allowed him to travel home alone, is appalling to say the least. Such attitude harks back to another time when the landed gentry practically owned the serfs, and disposed of them when the latter had grown old, sick or otherwise lost their usefulness. WHEREFORE, premises considered, the petition is hereby DISMISSED and the Decision assailed in this petition is AFFIRMED. Costs against petitioners. __________________________________________________________________ 3. COLEGIO DE SAN JUAN DE LETRAN VS. ASSOCIATION OF EMPLOYEES AND FACULTY OF LETRAN 4. FARROL V. CA. 325 SCRA 331 FACTS G.R. No. 141471 | September 18, 2000 Facts: On December 1992, in the course of its renegotiation of the CBA with the Colegio de San Juan de Letran, Association of Employees and Faculty of Letran, the union elected a new set of officers wherein private respondent Eleanor Ambas emerged as the newly elected President. Ambas wanted to continue the renegotiation of the CBA but petitioner, through Fr. Edwin Lao, claimed that the CBA was already prepared for signing by the parties. Petitioner accused the union officers of bargaining in bad faith before the NLRC. The Labor Arbiter decided in favor of petitioner but was later on reversed on appeal. While negotiating on a new CBA, Ambas was informed through a letter that her work schedule was being changed from Monday to Friday to Tuesday to Saturday. Ambas protested and requested management to submit the issue to a grievance machinery under the old CBA. Petitioner then dismissed Ambas for alleged insubordination. Ambas has been in the service for more than 10 years and has been a recipient of Loyalty Award. The Secretary of Labor and Employment declared petitioner guilty of unfair labor practice on two counts and directing the reinstatement of private respondent Ambas with backwages. On appeal, the CA affirmed the findings of the Secretary. Issue: Whether the termination of the union president amounts to an interference of the employees' right to self-organization. Held: YES. The dismissal was effected in violation of the employees' right to selforganization. While the Court recognize the right of the employer to terminate the services of an employee for a just or authorized cause, nevertheless, the dismissal of employees must be made within the parameters of law and pursuant to the tenets of equity and fair play.iThe employer's right to terminate the services of an employee for just or authorized cause must be exercised in good faith. It must not amount to interfering with, restraining or coercing employees in the exercise of their right to self-organization because it would amount to, as in this case, unlawful labor practice under Article 248 of the Labor Code. Admittedly, management has the prerogative to discipline its employees for insubordination. But when the exercise of such management right tends to interfere with the employees' right to self-organization, it amounts to union-busting and is therefore a prohibited act. __________________________________________________________________

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C - Winifredo Farrol was the station cashier of RCPI (Radio Communications of the Philippines, Inc.) Cotabato City Station. - There was a P50K cash shortage in the branchs Peragram, Petty and General Cash Funds. Farrol was required to explain the cash shortage. He paid to P25K to RCPI. - He was then required to explain why he should not be dismissed. Petitioner wrote to the Field Auditor stating that the missing funds were used for the payment of the retirement benefits earlier referred by the Branch Manager and that he already paid P25k. After he made 2 more payments of the cash shortage, he was placed under preventive suspensions. He still made 2 payments of the balance. - RCPI then sent Farrol a letter informing him of the termination of his services for alleging that part of the cash shortage was used for payment of salaries and retirement benefits, disregard of policies involving statistical reports, malversation /misappropriation (which is a ground for dismissal), and loss of trust and confidence. - Unaware of the termination letter, he requested his reinstatement since his preventive suspension had expired. Ferrol even manifested his willingness to settle the case. RCPI informed him that his employment had already been terminated. The conflict was sent to the grievance committee. Two years later, it was submitted for voluntary arbitration. - VA ruled in favor of Farrol. RCPI filed a petition for certiorari before the CA, which reversed VA decision. CA also dismissed MFR. - Farrol now filed a petition for review on certiorari on the ground that his dismissal was illegal because he was not afforded due process and that he cannot be held liable for the loss of trust and confidence reposed in him. rigid application or interpretation would be too harsh to the employee. This is Farrols 1st offense, to which the Court holds that dismissal is too harsh and grossly disproportionate. Disposition CA is REVERSED and SETASIDE and new one entered REINSTATING the decision of the Voluntary Arbitrator subject to the MODIFICATION that petitioners separation pay be recomputed to include the period within which backwages are due. For this purpose, this case is REMANDED to the Voluntary Arbitrator for proper computation of backwages, separation pay, 13th month pay, sick leave conversion and vacation leave conversion. __________________________________________________________________ 5. VH MANUFACTURING INC. V. NLRC, 322 SCRA 417 FACTS Since November 5, 1985 Gamido was employed in VH Manufacturings business of manufacturing liquefied petroleum gas (LPG) cylinders. He served as a quality control inspector with the principal duty of inspecting LPG cylinders for any possible defects. His service with the company was abruptly interrupted on February 14, 1995, when he was served a notice of termination of his employment. - His dismissal stemmed from an incident on February 10, 1995 wherein VHs company President, Alejandro Dy Juanco, allegedly caught private Gamido sleeping on the job. On that same day, private respondent was asked through a written notice from the petitioners Personnel Department to explain within twenty-four (24) hours why no disciplinary action should be taken against him for his violation of Company Rule 15-b which provides for a penalty of separation for sleeping during working hours. Without delay, private respondent replied in a letter which reads: "Sir, ipagpaumanhin po ninyo kung nakapikit ako sa aking puwesto dahil hinihintay ko po ang niliha hi Abreu para i quality pasensiya na po kung hindi ko po namalayan ang pagdaan ninyo dahil maingay po ang painting booth." Notwithstanding his foregoing reply, he was terminated. - Feeling aggrieved, he filed a complaint for illegal dismissal, praying for reinstatement to his position as quality control inspector. Labor Arbiter declared that Gamidos dismissal is anchored on a valid and just cause. NLRC reversed the decision. ISSUE WON Gamidos dismissal was too harsh a penaltly for his violation of company rule 15-b HELDYES. Basically, the reason cited for the dismissal of private respondent is sleeping on the job in violation of Company Rule 15-b. But according to Gamido, he was not sleeping on the job but was merely idle, waiting for the next cylinder to be checked. - In view of the gravity of the penalty of separation, as provided by the Company Rules and Regulation., in termination disputes, the burden of proof is always on the employer to prove that the dismissal was for a just and valid cause. What is at stake here is not

ISSUE WON he was illegally terminated HELD YES - Burden of proof resides on the employer to prove that there was valid cause for dismissal, and that he was afforded the opportunity to be heard and defend himself. - For the 1st notice, RCPI required petitioner to explain why he failed to account for the shortage. The 2nd notice was that informing Farrol of his termination. It does not clearly cite the reasons for dismissal, nor were there facts and circumstances in support thereof. - Even assuming there was a breach of trust and confidence, there was no evidence that Farrol was a managerial employee. The term trust and confidence is restricted to managerial employees. - RCPI alleges that under its rules, petitioners infarction is punishable by dismissal. However, employers rules cannot preclude the state from inquiring whether strict and

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C only the job itself of the employee but also his regular income therefrom which is the means of livelihood of his family. - A thorough review of the record discloses that, contrary to the findings of the Labor Arbiter, petitioners claim that private respondent slept on the job was not substantiated by any convincing evidence other than the bare allegation of the officer. - Next, VHs reliance on the authorities it cited that sleeping on the job is always a valid ground for dismissal, is misplaced. The authorities cited involved security guards whose duty necessitates that they be awake and watchful at all times inasmuch as their function, to use the words in Luzon Stevedoring Corp. v. Court of Industrial Relations, is "to protect the company from pilferage or loss." Accordingly, the doctrine laid down in those cases is not applicable to the case at bar. - Finally, while an employer enjoys a wide latitude of discretion in the promulgation of policies, rules and regulations on work-related activities of the employees, those directives, however, must always be fair and reasonable, and the corresponding penalties, when prescribed, must be commensurate to the offense involved and to the degree of the infraction. In the case at bar, the dismissal meted out on private respondent for allegedly sleeping on the job, under the attendant circumstances, appears to be too harsh a penalty, considering that he was being held liable for first time, after nine 9 of unblemished service, for an alleged offense which caused no prejudice to the employer, aside from absence of substantiation of the alleged offense. Neither was it shown that private respondents alleged negligence or neglect of duty, if any, was gross and habitual. Thus, reinstatement is just and proper. Disposition petition is hereby DISMISSED, and the challenged Decision and Order of public respondent NLRC are AFFIRMED. __________________________________________________________________ 6. CEBU FILVENEER CORPORATION VS NATIONAL LABOR RELATIONS COMMISSION | GR No. 126601| February 24, 1998 FACTS: Jessielyn Villaflor was hired as chief accountant of petitioner Cebu Filveneer Corporation. Ms. Rhodora M. Guillermo served as her accounting clerk. The top executives of petitioner corporation were Italians: Mr. Carlo Cordaro, President; Mr. John Chapman Kun, General Manager; and, Mr. Renato Marinoni, Production Manager. Mr. Kun informed Mr. Cordaro of his desire to resign as general manager effective March 1, 1992. He requested for the liquidation of his investment in the company in the sum of P125,000.00. Mr. Kun secured one blank check and blank check voucher from Ms. Guillermo. Ms. Guillermo failed to immediately inform the private respondent of the blank check and voucher taken by Mr. Kun. Private respondent, however, noticed the missing check voucher. She asked Ms. Guillermo about the check voucher and was told that it was with Mr. Kun. Mr. Kun was able to prepare the check in the amount of P125,000.00, had it signed by Mr. Marinoni and encashed. Private respondent learned of Mr. Kun's act and forthwith informed Mr. Cordaro who was then in Italy. Mr. Cordaro suspended Mr. Kun and designated Mr. Marinoni and the private complainant as responsible persons for the company funds. He also directed the private complainant to assist the company lawyer in filing a criminal case against Mr. Kun. On her part, the private complainant wrote to the PNB MEPZ Branch demanding the return of the encashed check. Mr. Marinoni confronted the private respondent and charged her with complicity in Mr. Kun's irregular disbursement of company funds. On February 17, 1992, the private respondent reported for work late and was prevented entry by the security guards. A Restriction Order has been issued against her by Mr. Marinoni upon authority of Mr. Cordaro. Mr. Marinoni also caused the forcible opening of private respondent's table and the vault inside her office. Private respondent complained to the MEPZ Labor Relations Officer. The next day, Mr. Marinoni issued a memorandum suspending the private respondent for thirty (30) days without pay effective February 17, 1992 for failure to report to office for half a day. On February 19, 1992, the private respondent filed a case against the petitioners for illegal dismissal. On February 20, 1992, Mr. Marinoni issued another memorandum preventively suspending her for thirty (30) days effective the next day pending investigation on her involvement in the unauthorized encashment by Mr. Kun of company funds. ISSUES: Whether private respondent Villaflor was illegally dismissed? Whether the amount earned of an employee during the termination should be deducted from the amount awarded to the employee? Whether the award for moral damages is warranted to the employee? Whether the President, Mr. Cordaro, should be solidarily liable with the corporation for the payment to the employee? RULING: In labor-management relations, there can be no higher penalty than dismissal from employment. Dismissal severs employment ties and could well be the economic death sentence of an employee. Dismissal prejudices the socio-economic well being of the employee's family and threatens the industrial peace. Due to its far reaching implications, our Labor Code decrees that an employee cannot be dismissed, except for the most serious causes. The overly concern of our laws for the welfare of employees is in accord with the social justice philosophy of our Constitution. Prescinding from these premises, petitioners' insistence that they legally dismissed the private respondent for loss of trust stands on quicksand. At the very most, petitioners were only able to prove that private respondent failed to inform immediately her superiors of the act of Mr. Kun in getting a blank check and blank voucher from Ms. Guillermo. The omission of the private respondent can hardly be described as "willful" to justify her dismissal. For one, the omission did not last for long. For another, the subsequent actions of the private respondent upon learning of the encashment of the unauthorized check by Mr. Kun negate any implication that she willfully or intentionally defaulted in reporting to prejudice petitioners. Indeed, she reported the matter to petitioner Cordaro and wrote to the PNB MEPZ Branch to retrieve the encashed check. A breach is willful if it is done intentionally, knowingly and purposely. Petitioners merely proved the omission of the private respondent but there is no evidence whatsoever that it was done intentionally.

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C Petitioners' demand that the backwages should he reduced in view of the time she spent in the United States deserves scant attention. On 21 March 1989, Republic Act No. 6715 took effect, amending the Labor Code. Article 279 thereof states in part: Art. 279. Security of Tenure. An employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages, inclusive of allowances, and to his other benefits or their monetary equivalent computed from the time his compensation is withheld from him up to the time of his actual reinstatement. Backwages to be awarded to an illegally dismissed employee, should not, as a general rule, be diminished or reduced by the earnings derived by him elsewhere during the period of his illegal dismissal. The underlying reason for this ruling is that the employee, while litigating the legality (illegality) of his dismissal, must still earn a living to support himself and family, while full backwages have to be paid by the employer as part of the price or penalty he has to pay for illegally dismissing his employee. We hold that public respondent should not have awarded moral damages and attorney's fees in favor of the private respondent. To be sure, the private respondent was negligent when she did not immediately inform her superior about the blank check and voucher taken by Mr. Kun, although, as aforediscussed, it is not the specie of negligence that will justify dismissal. Thus, petitioners should not and cannot be made to pay moral damages and attorney's fees for their dismissal of the private respondent was not motivated by bad faith or malice. Finally, we hold that Mr. Cordaro cannot be made solidarily liable with petitioner corporation for the illegal dismissal of the private respondent. In dismissing the private respondent, he acted as President of petitioner corporation and he did so in good faith. His act as an officer of the corporation cannot result in his private liability. This is too fundamental. a rule to deserve further discussion. __________________________________________________________________ 7. GOLDEN THREAD KNITTING INDUSTIRES V NLRC (MACASPAC) 304 SCRA 720 FACTS: Several employees of Golden Thread Knitting Industries (GTK) were dismissed for different reasons. Two employees were dismissed for allegedly slashing the companys products (towels), 2 for redundancy, 1 for threatening the personnel manager and violating the company rules, and 1 for abandonment of work. The laborers filed complaints for illegal dismissal. They allege that the company dismissed them in retaliation for establishing and being members of the Labor Union. GTK, on the other hand, contend that there were valid causes for the terminations. The dismissals were allegedly a result of the slashing of their products, rotation of work, which in turn was caused by the low demand for their products, and abandonment of work. WRT to the cases involving the slashing of their products and threats to the personnel manager, the dismissals were in effect a form of punishment. The labor arbiter ruled partially in favor of GTK. He said that there was no showing that the Doctrine: Dismissal is the ultimate penalty that can be meted to an employee. It must therefore be based on a clear and not on an ambiguous or ambivalent ground. From our assessment of the records, we find that petitioners exercised their authority to dismiss without due regard to the pertinent exacting provisions of the Labor Code. The right to terminate should be utilized with extreme caution because its immediate effect is to put an end to an employee's present means of livelihood while its distant effect, upon a subsequent finding of illegal dismissal, is just as pernicious to the employer who will most likely be required to reinstate the subject employee and grant him full back wages and other benefits. __________________________________________________________________ 8. CENTRAL PANGASINAN ELECTRIC COOP INC. V. MACARAEG, 395 SCRA 720 dismissals were in retaliation for establishing a union. He, however, awarded separation pay tosome employees. NLRC, however, appreciated the evidence differently. It heldthat there was illegal dismissal and ordered reinstatement. ISSUE:WON there was illegal dismissal? HELD: YES. Dismissal is the ultimate penalty that can be meted to an employee. It must therefore be based on a clear and not on an ambiguous or ambivalent ground. WRT to the case involving slashing of towels, the employees were not given procedural due process. There was no notice and hearing, only outright denial of their entry to the work premises by the security guards. The charges of serious misconduct were not sufficiently proved.WRT to the employees dismissed for redundancy, there was also denial of procedural due process. Hearing and notice were not observed. Thus, although the characterization of an employees services is a management function, it must first be proved with evidence, which was not done in this case. thecompany cannot merely declare that it was overmanned.WRT to the employee dismissed for disrespect, the SC believed the story version of the company (which essentially said that the personnel manager was threatened upon mere service of a suspension order to the employee), but ruled that he dismissal could not be upheld. the dismissal will not be upheld where it appears that the employees act of disrespect was provoked by the employer. xxx the employee hurled incentives at the personnel manager because she was provoked by the baseless suspension imposed on her. The penalty of dismissal must be commensurate with the act, conduct, or omission to the employee. - The dismissal was too harsh a penalty; a suspension of 1 week would have sufficed. GTK exercised their authority to dismiss without due regard to the provisions of the Labor Code. The right to terminate should be utilized with extreme caution because its immediate effect is to put an end to an employee's present means of livelihood while its distant effect, upon a subsequent finding of illegal dismissal, is just as pernicious to the employer who will most likely be required to reinstate thes ubject employee and grant him full back wages and other benefits.

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C This is a petition for review on certiorari, petitioner Central Pangasinan Electric Cooperative, Inc. challenges the decision of the Court of Appeals in CA-G.R. SP No. 55128 affirming the decision of the voluntary arbitrator in NCMB-RBI-PM-VA-5-03-99 ordering the reinstatement of respondents to petitioners employ and payment of their backwages. Petitioner is an electric cooperative while the respondents, Geronima Macaraeg and Maribeth de Vera are employees of petitioner at its office in Area V, Bayambang, Pangasinan. Respondent de Vera was employed as teller whose primary duty was to accept payments from petitioners consumers in Bayambang and remit her collections to the cashier, herein co-respondent Geronima Macaraeg. From January 1998 to January 1999, respondent de Vera accommodated and encashed the crossed checks of her sister, Evelyn Joy Estrada amounting to P6,945,128.95 payable to petitioner cooperative. In turn, respondent de Vera, with the knowledge and consent of respondent Macaraeg, paid the full value of these checks from the cash collections of petitioner. Such act was discovered in January 1999 by the petitioner, through its Finance Department. Petitioner confronted respondents with their discovery. Respondent de Vera admitted that the checks were issued by her sister and that she encashed them from the money collected from petitioners customers. A memo was submitted to the GM detailing the findings about the bounced checks. Petitioner, through de Guzman, issued a memorandum to respondents placing them under preventive suspension and requiring them to explain in writing within fortyeight (48) hours why they misappropriated cooperative funds. A hearing was also held at the board room of the petitioner with the assistance of respondents counsel. Respondents provided answers/explanations. On March 10, 1999, Atty. Fernandez submitted his findings to the General Manager of petitioner. On the basis of said findings and recommendation, the General Manager issued to respondents separate notices of termination, effective April 9, 1999, for serious misconduct, and breach of trust and confidence reposed on them by management. Respondents, with the help of the President and representative of the Union, Central Pangasinan Electric Cooperative (CENPELCO) Employees Association-Tupas Local Chapter No. R01-0012, questioned their dismissal before the National Conciliation and Mediation Board (NCMB). They claimed that their dismissal was without just cause and in violation of the Collective Bargaining Agreement (CBA), which requires that the case should first be brought before a grievance committee. Eventually, the parties agreed to submit the case to a voluntary arbitrator for arbitration. On August 12, 1999, the voluntary arbitrator rendered a decision in favor of respondents and asffirmed by the CA on August 17, 2000. Hence, this petition; ISSUE: Whether respondents were validly dismissed. HELD: YES. The SC held that there exists a valid reason to dismiss both employees. Article 282(c) of the Labor Code allows an employer to dismiss employees for willful breach of trust or loss of confidence. Proof beyond reasonable doubt of their misconduct is not required, it being sufficient that there is some basis for the same or that the employer has reasonable ground to believe that they are responsible for the misconduct and their participation therein rendered them unworthy of the trust and confidence demanded of their position. Here, the acts of the respondents were clearly inimical to the financial interest of the petitioner. During the investigation, they admitted accommodating Evelyn Joy Estrada by encashing her checks from its funds. They did so without petitioners knowledge, much less its permission. These inimical acts lasted for more than a year, and probably would have continued had it not been discovered in time. All along, they were aware that these acts were prohibited by the Coop Checks Policy. Clearly, there was willful breach of trust on the respondents part, as they took advantage of their highly sensitive positions to violate their duties. Also, petitioner observed procedural due process in dismissing the respondents. IN VIEW WHEREOF, the petition is GRANTED. The Decision and Resolution of the Court of Appeals in CA-G.R. SP No. 55128 (affirming the decision of the voluntary arbitrator in NCMB-RBI-PM-VA-5-03-99) are reversed and set aside. __________________________________________________________________ 9. JOSE V. SALVADOR, PETITIONER, VS. PHILIPPINE MINING SERVICE CORPORATION, RESPONDENT. G.R. NO. 148766. JANUARY 22, 2003 FACTS: Respondent company Philippine Mining Service Corporation is engaged in developing dolomite ore deposits in Cebu used in glass, fertilizer and steel manufacture. Their products also include contaminated ore and dolomite spillage. Petitioner Jose Salvador is a shift boss or foreman who oversees both mining and plant operations. As shift boss, he was entrusted with the care, supervision and protection of the entire plant. Aside from his employment with respondent company, petitioner is also the business partner of Ondo Alcantara in the manufacture and sale of hollow blocks. One evening, respondent's Assistant Resident Manager Koji Sawa chanced upon petitioner hauling fine ore from the stockpile, using their payloader to petitioner's private truck, contrary to standard operating procedure. Sawa checked the delivery receipt which indicated that it was dolomite spillage that was purchased by buyer Ondo Alcantara, not the fine ore that he saw petitioner loading on his truck. The receipt also showed it was the buyer who should load the spillage he purchased from the plant with the use of his own equipment. Consequently, petitioner was investigated for and found guilty of pilferage and violation of company rules and policy that resulted in loss of confidence. Hence, respondent company dismissed petitioner from service. Petitioner filed a case for illegal dismissal with the Labor Arbiter which found for the petitioner but did not order him reinstated on account of antagonistic relations between the parties. The arbiter only ordered separation pay and not backwages because he did not deserve it due to his indiscretion amounting to gross neglect of duty. Both parties

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C appealed the decision to the NLRC which affirmed the arbiter's decision, modifying it to reinstate petitioner. Respondent company assailed the NLRC decision before the Court of Appeals. The appellate court ruled that there was valid and just cause for petitioners dismissal as it was proved that he was guilty of pilferage, serious misconduct and dishonesty. Hence, this appeal by the petitioner. ISSUE: Whether or not the charge of pilferage against petitioner was supported by substantial evidence to warrant his dismissal from the service. HELD: The Court ruled in the affirmative after evaluation of the parties' evidence indubitably showed that petitioners dismissal for loss of trust and confidence was duly supported by substantial evidence. The Labor Code provides that an employer may terminate the services of an employee for just cause and this must be supported by substantial evidence. In administrative and quasi-judicial proceedings, the settled rule is that the required proof in determining the legality of an employee's dismissal is substantial evidence and not proof beyond reasonable doubt nor preponderance of evidence. According to the Court, substantial evidence is more than a mere scintilla of evidence or relevant evidence as a reasonable mind might accept as adequate to support a conclusion, even if other minds, equally reasonable, might conceivably opine otherwise. Thus, substantial evidence is the least demanding in the hierarchy of evidence. The Court said, In the case at bar, respondent has every right to dismiss petitioner, a managerial employee, for breach of trust and loss of confidence as a measure of selfpreservation against acts patently inimical to its interests. Indeed, in cases of this nature, the fact that petitioner has been employed with the respondent for a long time, if to be considered at all, should be taken against him, as his act of pilferage reflects a regrettable lack of loyalty which he should have strengthened, instead of betrayed. __________________________________________________________________ 10. HABANA V. NLRC |298 SCRA 537 | SEPTEMBER 10, 1999 FACTS: Rodrigo Habana was hired by OMANFIL to work for its foreign principal, HYUNDAI, in Kuwait, for 2 years based on the employment contract. However, after 1 year, HYUNDAI issued a Resignation Notice terminating his employment. Habana was forced to return to the Philippines. Together with another dismissed employee, Adjuthor De Guzman, they filed a complaint for illegal dismissal against OMANFIL and HYUNDAI (private respondents). Summons was issued to OMANFIL and HYUNDAI to file their answer within 10 days from receipt thereof. After 2 days beyond the period set, the two filed a Motion for Bill of Particulars instead, alleging that the complaint sheet filed by Habana and De Guzman lacked the required narration of facts constituting causes of action. Habana and De Guzman moved to declare default on private respondents for failure to submit answer on time. Private respondents opposed the motion. The parties later agreed to submit their motions for consideration to the Labor Arbiter. Without waiting for the resolution, complainants filed their Bill of Particulars. Thereafter, the LA rendered decision in favor of complainants holding that due to failure of private respondents to file their answers, the case is resolved on the basis of complainants position paper and other supporting documents. On appeal, the NLRC set aside the decision of the LA and remanded the case to the court of origin for further proceedings, ruling that OMANFIL and HYUNDAI were denied due process for not having allowed private respondents present their answers considering that there are still factual issues that need to be taken into consideration into. ISSUE: Were OMANFIL and HYUNDAI denied due process? HELD:Yes. First, there was only one conciliatory conference held wherein the parties did not discuss at all the possibility of amicable settlement due to complainants insistence of default on private respondents. Second, the parties agreed to submit their respective motions for consideration of the LA. Third, since the conference, no order or notice was sent by the LA to the private respondents as to what happened on their motions and they were not also declared in default by the LA. Fourth, neither there was any order or notice requiring private respondents to file their position paper, nor an order informing the parties that the case was already submitted for decision.

Based on the foregoing, there was utter absence of opportunity to be heard at the arbitration level, as the procedure adopted by the LA virtually prevented private respondents from explaining matters fully and presenting their side. The essence of due process is that a party be afforded a reasonable opportunity to be heard and to submit evidence he may have in support of his defense. Where, as in this case, sufficient opportunity to be heard either through oral arguments or position paper and other pleadings is not accorded a party to a case, there is undoubtedly a denial of due process. In the instant case, what should have been done by the Labor Arbiter was to rule on the pending motions, or at least notify private respondents that he would no longer resolve their motions, and to direct them forthwith to submit within a reasonable time their position paper as well as all the evidence they might want to introduce before the case would be resolved. These are essential not only in the interest of orderly procedure but, more importantly, as part of due process. But as has been said, not a single order or notice was received by private respondents from the Labor Arbiter, other than the assailed decision. Decision of NLRC to remand the case to the court of origin for further hearings affirmed. __________________________________________________________________

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C 11. PLDT V. TOLENTINO | G.R. No. 143171 | September 21, 2004 Facts: Respondent Tolentino was employed in petitioner PLDT for 23 years. He started in 1972 as an installer/helper and, at the time of his termination in 1995, was the division manager of the Project Support Division and Provincial Expansion Center. In 1995, Jonathan de Rivera, a supervisor directly under respondent Tolentino, was found to have entered into an internal arrangement with the sellers of a parcel of land which he recommended for acquisition under PLDTs expansion program. Quirino Donato, the attorney-in-fact of the landowner, executed an affidavit disclosing his internal arrangement with de Rivera. Donatos affidavit revealed that all follow-up calls regarding the transaction were to be directed to the office of respondent and de Rivera. Upon being apprised of this internal arrangement, PLDT dismissed de Rivera. Afterwards, de Rivera submitted a sworn statement to PLDT implicating respondent as the person behind the anomalous internal arrangement. Respondent denied involvement to said agreement. PLDT sent a notice of dismissal to respondent. Attached to this notice was a handwritten note from Vice-President of the Provincial Expansion Center, giving Tolentino the option to resign. Petitioner did not grant respondents request for a formal hearing but delayed the implementation of his dismissal. Later on, petitioner informed respondent that his dismissal was already final and effective on December 5, 1995. Respondent then filed a complaint for illegal dismissal. Labor Arbiter found that petitioner PLDT failed to prove and substantiate the charges against respondent. NLRC reversed decision on the ground that respondent was a managerial employee and that loss of trust and confidence was enough reason to dismiss him. CA reinstated Labor Arbiters decision. Issue: W/N the Court of Appeals erred in ruling that the dismissal was not founded on clearly established facts sufficient to warrant separation from employment. Held:The petition is without merit. PLDTs basis for respondents dismissal was not enough to defeat respondents security of tenure. Proof beyond reasonable doubt is not required provided there is a valid reason for the loss of trust and confidence, such as when the employer has a reasonable ground to believe that the managerial employee concerned is responsible for the purported misconduct and the nature of his participation renders him unworthy of the trust and confidence demanded by his position. However, the right of the management to dismiss must be balanced against the managerial employees right to security of tenure which is not one of the guaranties he gives up upon his acceptance of his promotion. Managerial employees enjoy security of tenure and, although the standards for their dismissal are less stringent, the loss of trust and confidence must be substantial and founded on clearly established facts sufficient to warrant the managerial employees separation from the company. Substantial evidence is of critical importance and the burden rests on the employer to prove it. Due to its subjective nature, it can easily be concocted by an abusive employer and used as a subterfuge for causes which are improper, illegal or unjustified. Petitioners dismissal was not founded on clearly established facts sufficient to warrant separation from employment. The evidence relied upon by petitioner PLDT - de Riveras sworn statement and Donatos affidavit - does not, in our view, establish respondent Tolentinos complicity in the internal arrangement engineered by his subordinate de Rivera. It is true that respondent Tolentino was remiss in his duties as division manager for failing to discover the internal arrangement contrived by his subordinate. However, we disagree that dismissal was the proper sanction for such negligence. It was not commensurate to the lapse committed, especially in the light of respondents unblemished record of long and dedicated service to the company. Although a managerial employee, respondent should be reinstated to his former position or its equivalent without loss of seniority rights inasmuch as the alleged strained relations between the parties were not adequately proven by petitioner PLDT which had the burden of doing so. No competent evidence exists in the records to support PLDTs assertion that a peaceful working relationship with respondent Tolentino was no longer possible. In fact, the records of the case show that PLDT, through VP Sacdalan, gave respondent Tolentino the option to resign. Such a deferential act by management makes us doubt PLDTs claim that its relations with respondent were strained. The option to resign would not have been given had animosity existed between them. Furthermore, respondent was dismissed in December, 1995 when petitioner PLDT was still under the Cojuangco group. PLDT has since then passed to the ownership and control of its new owners, the First Pacific group which has absolutely nothing to do so with this controversy. Since there are no strained relations between the new management and respondent, reinstatement is feasible. Tolentino was reinstated with full backwages. WHEREFORE, the petition is hereby denied. The Court of Appeals decision reinstating the labor arbiters decision is AFFIRMED with MODIFICATION. The award of attorneys fees is reduced to 5% of the total amount due respondent Tolentino. The award of moral and exemplary damages is deleted for reasons already explained. __________________________________________________________________

12. FUJITSU COMPUTER PRODUCTS CORPORATION OF THE PHILIPPINES and ERNESTO ESPINOSA, petitioners, vs. THE HONORABLE COURT OF APPEALS, VICTOR DE GUZMAN and ANTHONY P. ALVAREZ, respondents. Facts: Respondent Victor de Guzman works for petitioner Fujitsu Computer Products Corporation of the Philippines (FCPP) as Facilities Section Manager. He was also holding in a concurrent capacity the position of Coordinator ISO 14000 Secretariat. Respondent Allan Alvarez, on the other hand, was employed as a Senior Engineer. He was assigned at the Facilities Department under the supervision of respondent De Guzman. The garbage and scrap materials of FCPP were collected and bought by the Saros Trucking Services and Enterprises (Saros).

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C On January 15, 1999, respondent De Guzman as Facilities Section Manager, for and in behalf of FCPP, signed a Garbage Collection Agreement with Saros. The latters signatory therein was its owner and general manager, Larry Manaig. Petitioner Ernesto Espinosa, HRD and General Affairs Director of FCPP, then received a disturbing report from Manaig. He reported that respondent De Guzman had caused the anomalous disposal of steel [purlins] owned by FCPP. Petitioner Espinosa sent a two-page InterOffice Memorandum to respondent De Guzman, effectively placing him under preventive suspension. He was likewise directed to submit his written explanation on the charges against him. In the Memorandum, petitioner said that Manaig disclosed to them that sometime in the first week of July 1999, De Guzman personally approached Mr. Roberto Pumarez, Supervisor of Saros, and intimated to him, his interest in the scrap metals. De Guzman allegedly told Pumarez that since Saros is paying FCPP P2.50 per kilo of metal, he will buy it from Saros for P3.00 per kilo. The Memorandum further stated that approximately 2,800 kgs of scrap metals were delivered by Saros to Sta. Rosa Baptist Church per De Guzmans instructions. It was likewise reported by Mr. Manaig that there were previous occasions in the past where De Guzman solicited from him empty drums, pails, and corrugated cartons, which were all part of those picked up from FCPP. Petitioner stated in the Memorandum that De Guzmans actions constitute qualified theft, grave abuse of authority, and willful breach of trust and confidence. De Guzman is directed to submit his written explanation within forty-eight (48) hours from his receipt why no disciplinary sanction should be imposed against him, including dismissal from the service. In his Explanation dated July 26, 1999, respondent De Guzman alleged that came to know from Rev. Mario de Torres, Pastor of St. Rosa Bible Baptist Church that they are in need of some steel [purlins] to be used by the church for its roof deck construction. He told him that Saros Trucking Services is the regular buyer of FCPPs scrap materials and they can buy from them. He referred the matter therefore to Mr. Roberto [Pumarez], Supervisor of Saros and told him of the intension of the Sta. Rosa Bible Baptist Church (SRBBC) to buy scrap metal. He further told him that since Saros is paying FCPP P2.60 of scrap metal, Sta. Rosa Bible Baptist Church can buy it from Saros at P3.00 per kilo a price higher than FCPP. Acknowledging that Mr. [Pumarez] is amenable to sell the scrap to Sta. Rosa Bible Baptist Church after consultation from his boss, De Guzman advised the Pastor of Sta. Rosa Bible Baptist Church that Saros agreed. His part of the transaction ended there. Respondent De Guzman also pointed out that he could not be charged for qualified theft since he merely issued gate passes to Saros after the scrap metals were declared ready for disposal by SNK, the company in charge thereof. The scrap metals in question were all accounted for and collected by Saros, and upon collection would be considered sold to the latter. On July 28, 1999, respondent Alvarez sent an e-mail message to his co-employees, expressing sympathy for the plight of respondent De Guzman. Respondent Alvarez used a different computer, but the event viewer system installed in the premises of petitioner FCPP was able to trace the e-mail message to him. Petitioner Espinosa issued an Inter-Office Memorandum wherein he asked Alvarez to explain in writing within 48 hours why no disciplinary action should be filed against him, including dismissal, for grossly presenting information, which is highly confidential while an investigation on Mr. De Guzman is going on. Respondent Alvarez submitted a written Explanation dated September 29, 1999 where he apologized, readily admitted that he was the sender of the e-mail message in question, and claimed that he acted alone with his own conviction. He alleged, however, that he was only expressing his sentiments, and that he was led by his desire to help a friend in distress, since the case is based on pure hearsay. Respondent Alvarez was informed that his services were terminated on the ground of serious misconduct effective August 13, 1999 through a Memorandum. Respondent De Guzmans employment was thereafter terminated effective August 23, 1999 through an Inter-Office Memorandum. The respondents then filed a complaint for illegal dismissal against the petitioners with prayer for reinstatement, full backwages, damages and attorneys fees before the NLRC, Regional Arbitration Branch, Region IV. The Labor Arbiter ruled in favor of FCPP, stating that it was justified in terminating the employment of the respondents. Respondent De Guzman, a managerial employee, was validly dismissed for loss of trust and confidence. The NLRC sustained the ruling of the Labor Arbiter and dismissed the respondents appeal for lack of merit. In so far as the dismissal of respondent Alvarez was concerned, the Commission held that the circumstances surrounding the sending of the clearly malicious and premeditated e-mail message constituted no less than serious misconduct. The Labor Arbiter and the NLRC likewise ruled that as borne out by the records, the respondents were not denied due process since they were sufficiently accorded an opportunity to be heard. The respondents then elevated their case to the Court of Appeals (CA), which reversed the ruling of the NLRC and held that the respondents were illegally dismissed. Issue: whether respondents De Guzman and Alvarez were illegally dismissed from employment. Held: It is settled that to constitute a valid dismissal from employment, two requisites must concur: (a) the dismissal must be for any of the causes provided for in Article 282 of the Labor Code; and (b) the employee must be afforded an opportunity to be heard and defend himself. This means that an employer can terminate the services of an employee for just and valid causes, which must be supported by clear and convincing evidence. It also means that, procedurally, the employee must be given notice, with adequate opportunity to be heard, before he is notified of his actual dismissal for cause. However, to be valid ground for dismissal, loss of trust and confidence must be based on a willful breach of trust and founded on clearly established facts. It must rest on substantial grounds and not on the employers arbitrariness, whims, caprices or suspicion; otherwise, the employee would eternally remain at the mercy of the employer. The act complained of must be work-related and shows that the employee concerned is unfit to continue working for the employer. The guidelines for the application of the doctrine of loss of confidence are as follows: a. loss of confidence should not be simulated; b. it should not be used as a subterfuge for causes which are improper, illegal or unjustified; c. it may not be arbitrarily asserted in the face of overwhelming evidence to the contrary; and d. it must be genuine, not a mere afterthought to justify earlier action taken in bad faith. In the case at bar, the grounds relied upon by petitioner FCPP in terminating the employment of respondent De Guzman is misplaced. First, the scrap metals, including the steel purlins, were already classified as scrap materials and ready for disposal. Second, no fraud or bad faith could be attributed to respondent De Guzman, as evinced by his readiness to disclose his participation in the transaction between Saros and Sta. Rosa. Third, respondent De Guzman was never charged with qualified theft as

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C earlier alluded to by the petitioner FCPP in its Inter-Office Memorandum. Fourth, respondent De Guzman was merely recommending a buyer for such scrap materials, an act which could hardly be considered as deserving of such a harsh penalty as dismissal from employment. Respondent De Guzmans actuations do not amount to willful breach of trust and confidence. It bears stressing that in termination cases, the employer bears the onus of proving that the dismissal was for just cause. When the breach of trust or loss of confidence theorized upon is not borne by clearly established facts, as in this case, such dismissal on the ground of loss of confidence cannot be allowed. Moreover, the fact that one is a managerial employee does not by itself exclude him from the protection of the constitutional guarantee of security of tenure. The Court likewise rules that the dismissal of respondent Alvarez from employment for gross misconduct was illegal. Misconduct has been defined as improper or wrong conduct. For misconduct or improper behavior to be a just cause for dismissal, (a) it must be serious; (b) must relate to the performance of the employees duties; and (c) must show that the employee has become unfit to continue working for the employer. In this case, the Court finds that respondent Alvarezs act of sending an e-mail message as an expression of sympathy for the plight of a superior can hardly be characterized as serious misconduct as to merit the penalty of dismissal. There is no showing that the sending of such e-mail message had any bearing or relation on respondent Alvarezs competence and proficiency in his job. In fine, the petitioners failed to show that the respondents acts were sufficient to warrant their dismissal from employment, for loss of trust and confidence on one hand for respondent De Guzman, and for gross misconduct as against respondent Alvarez on the other. To reiterate, it has not been shown that the respondents had been previously found guilty of any infraction of company rules and regulations during the period of their employment. Under Article 279 of the Labor Code, and employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges, and to the payment of his full backwages, inclusive of allowances, and to his other benefits or their monetary equivalent, computed from the time his compensation was withheld from him (which, as a rule, is from the time of his illegal dismissal) up to the time of his actual reinstatement. These remedies give life to the workers constitutional right to security of tenure. While an employer has its own interest to protect, and pursuant thereto, it may terminate a managerial employee for a just cause, such prerogative to dismiss or lay-off an employee must be exercised without abuse of discretion. Its implementation should be tempered with compassion and understanding. The employer should bear in mind that, in the execution of the said prerogative, what is at stake is not only the employees position, but his very livelihood. Where a penalty less punitive would suffice, whatever missteps may have been committed by the worker ought not be visited with a consequence so severe as dismissal from employment. Indeed, the consistent rule is that if doubts exist between the evidence presented by the employer and the employee, the scales of justice must be tilted in favor of the latter. WHEREFORE, the instant petition is DENIED. __________________________________________________________________ 13. GENUINO ICE CO INC V. MAGPANTAY, 493 SCRA 195 FACTS: Alfonso Magpantay (respondent) was employed as a machine operator with Genuino Ice Company, Inc. (petitioner) from March 1988 to December 1995. On November 18, 1996, respondent filed against petitioner a complaint for illegal dismissal with prayer for moral and exemplary damages. In his Position Paper, respondent alleged that he was dismissed from service effective immediately by virtue of a memorandum, after which he was not allowed anymore to enter the company premises. Respondent bewailed that his termination from employment was done without due process. Petitioner countered that he was not illegally dismissed, since the dismissal was based on a valid ground, i.e., he led an illegal strike at petitioners sister company, Genuino Agro Industrial Development Corporation, which lasted from November 18 to 22, 1995, resulting in big operation losses on the latters part. Petitioner also maintained that respondents dismissal was made after he was accorded due process. Respondent replied, however, that assuming that he led such illegal strike, he could not be liable therefore because it was done in petitioners sister company which is a separate and distinct entity from petitioner. Petitioner initially claimed that respondents acts were tantamount to serious misconduct or willful disobedience, gross and habitual neglect of duties, and breach of trust. Subsequently, petitioner amended its position paper to include insubordination among the grounds for his dismissal, since it came out during respondents cross-examination, and the matter was reported only after the new personnel manager assumed his position in August 1996. ISUUE: Whether or not the Court a quo erred and committed grave abuse of discretion in declaring that the respondent was illegally dismissed from employment. HELD: On the issue of illegal dismissal, both the Labor Arbiter and the NLRC were one in concluding that petitioner had just cause for dismissing respondent, as his act of leading a strike at petitioners company for four days, his absence from work during such time, and his failure to perform his duties during such absence, make up a cause for habitual neglect of duties, while his failure to comply with petitioners order for him to transfer to the GMA, Cavite Plant constituted insubordination or willful disobedience. The CA, however, differed with said conclusion and found that respondents attitude has not been proved to be visited with any wrongdoing, and that his four-day absence does not appear to be both gross and habitual. The Court sustains the CAs finding that respondents four-day absence does not amount to a habitual neglect of duty; however, the Court finds that respondent was validly dismissed on ground of willful disobedience or insubordination. Under Article 282 of the Labor Code, as amended, 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

10

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C 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. The employer has the burden of proving that the dismissal was for a just cause; failure to show this would necessarily mean that the dismissal was unjustified and, therefore, illegal. Neglect of duty, to be a ground for dismissal, must be both gross and habitual. Gross negligence connotes want of care in the performance of ones duties. Habitual neglect implies repeated failure to perform ones duties for a period of time, depending upon the circumstances. On the other hand, fraud and willful neglect of duties imply bad faith on the part of the employee in failing to perform his job to the detriment of the employer and the latters business. Thus, the single or isolated act of negligence does not constitute a just cause for the dismissal of the employee. Thus, the Court agrees with the CA that respondents four-day absence is not tantamount to a gross and habitual neglect of duty. As aptly stated by the CA, (W)hile he may be found by the labor courts to be grossly negligent of his duties, he has never been proven to be habitually absent in a span of seven (7) years as GICIs employee. The factual circumstances and evidence do not clearly demonstrate that petitioners [respondent] absences contributed to the detriment of GICIs operations and caused irreparable damage to the company. Petitioner, however, insists that during his four-day absence, respondent was leading an illegal strike in its sister company. In the first place, there is no showing that the strike held at the Genuino Agro Industrial Development Corporation is illegal. It is a basic rule in evidence that each party must prove his affirmative allegation. Since the burden of evidence lies with the party who asserts the affirmative allegation, the plaintiff or complainant has to prove his affirmative allegations in the complaint and the defendant or the respondent has to prove the affirmative allegation in his affirmative defenses and counterclaim. Since it was petitioner who alleged that such strike is illegal, petitioner must, therefore, prove it. Except for such bare allegation, there is a dearth of evidence in this case proving the illegality of said strike. However, as previously stated, the Court finds that respondent was validly dismissed on the ground of insubordination or willful disobedience. Willful disobedience, or insubordination as otherwise branded in this case, as a just cause for dismissal of an employee, necessitates the concurrence of at least two requisites: (1) the employee's assailed conduct must have been willful, that is, 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. The rule is that the transfer of an employee ordinarily lies within the ambit of the employers prerogatives. The employer exercises the prerogative to transfer an employee for valid reasons and according to the requirement of its business, provided the transfer does not result in demotion in rank or diminution of the employees salary, benefits and other privileges. In this case, petitioners order for respondent to transfer to the GMA, Cavite Plant is a reasonable and lawful order was made known to him and pertains to his duties as a machine operator. There was no demotion involved or diminution of salary, benefits and other privileges, and in fact, petitioner was even willing to provide respondent with monetary allowance to defray whatever additional expenses he may incur with the transfer. __________________________________________________________________ 14. LAKPUE V. BELGA, 473 SCRA 617 Facts: Petitioner Tropical Biological Phils., Inc. (Tropical), a subsidiary of Lakpue Group of Companies, hired Belga as bookkeeper and subsequently promoted as assistant cashier. On March 2001, Belga brought her daughter to the PGH for treatment of broncho-pneumonia. On her way to the hospital, Belga dropped by the house of Vegafria, Technical Manager of Tropical, to hand over the documents she worked on over the weekend and to give notice of her emergency leave. While at the PGH, Belga who was pregnant experienced labor pains and gave birth on the same day. On March 22, 2001, or two days after giving birth, Tropical summoned Belga to report for work but the latter replied that she could not comply because of her situation. On March 30, 2001, Tropical sent Belga another memorandum ordering her to report for work and also informing her of the clarificatory conference scheduled on April 2, 2001. Belga requested that the conference be moved to April 4, 2001 as her newborn was scheduled for check-up on April 2, 2001. When Belga attended the clarificatory conference on April 4, 2001, she was informed of her dismissal effective that day. Belga thus filed a complaint with the Public Assistance and Complaint Unit of the Department of Labor and Employment (DOLE). Attempts to settle the case failed, hence the parties brought the case before the NLRC-NCR. Tropical, for its part, averred that it hired Belga on March 1, 1995 as a bookkeeper and later promoted to various positions the last of which was as Treasury Assistant. Tropical also alleged that Belga concealed her pregnancy from the company. She did not apply for leave and her absence disrupted Tropicals financial transactions. On March 21, 2001, it required Belga to explain her unauthorized absence and on March 30, 2001, it informed her of a conference scheduled on April 2, 2001. Tropical claimed that Belga refused to receive the second memorandum and did not attend the conference. She reported for work only on April 4, 2001 where she was given a chance to explain. On April 17, 2001, Tropical terminated Belga on the following grounds: (1) Absence without official leave for 16 days; (2) Dishonesty, for deliberately concealing her pregnancy; (3) Insubordination, for her deliberate refusal to heed and comply with the memoranda sent by the Personnel Department on March 21 and 30, 2001 respectively. The Labor Arbiter ruled in favor of Belga and found that she was illegally dismissed. NLRC reversed. CA favoured Belga. Issue: W Belga was illegally dismissed Held: Yes. Tropicals ground for terminating Belga is her alleged concealment of pregnancy. It argues that such non-disclosure is tantamount to dishonesty and impresses upon this Court the importance of Belgas position and the gravity of the disruption her unexpected absence brought to the company. Tropical also charges

11

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C Belga with insubordination for refusing to comply with its directives to report for work and to explain her absence. Tropical cites the following paragraphs of Article 282 of the Labor Code as legal basis for terminating Belga: Article 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; .... (c) Fraud or willful breach by the employee of the trust reposed in him by his employer or duly authorized representative; .... We have defined misconduct as a transgression of some established and definite rule of action, a forbidden act, a dereliction of duty, willful in character, and implies wrongful intent and not mere error in judgment. The misconduct to be serious must be of such grave and aggravated character and not merely trivial and unimportant. Such misconduct, however serious, must, nevertheless, be in connection with the employees work to constitute just cause for his separation.[10] In the instant case, the alleged misconduct of Belga barely falls within the situation contemplated by the law. Her absence for 16 days was justified considering that she had just delivered a child, which can hardly be considered a forbidden act, a dereliction of duty; much less does it imply wrongful intent on the part of Belga. Tropical harps on the alleged concealment by Belga of her pregnancy. This argument, however, begs the question as to how one can conceal a full-term pregnancy. We agree with respondents position that it can hardly escape notice how she grows bigger each day. While there may be instances where the pregnancy may be inconspicuous, it has not been sufficiently proven by Tropical that Belgas case is such. Belgas failure to formally inform Tropical of her pregnancy can not be considered as grave misconduct directly connected to her work as to constitute just cause for her separation. Time and again, we have recognized the right of employers to dismiss employees by reason of loss of trust and confidence. However, we emphasize that such ground is premised on the fact that the employee concerned holds a position of responsibility or trust and confidence. In order to constitute a just cause for dismissal, the act complained of must be work-related such as would show the employee concerned to be unfit to continue working for the employer.[13] More importantly, the loss of trust and confidence must be based on the willful breach of the trust reposed in the employee by his employer. A breach of trust is willful if it is done intentionally, knowingly and purposely, without justifiable excuse, as distinguished from an act done carelessly, thoughtlessly, heedlessly or inadvertently. Belgas position is merely clerical. __________________________________________________________________ 15. MICRO SALES OPERATION NETWORK VS NLRC Facts: Petitioner, Micro Sales Operation Network (MSON) is a domestic corporation engaged in local transportation of goods by land. Petitioner Willy Bendol was the companys operations manager at the time of the controversy. Private respondents Larry Hermosa, Leonardo de Castro, and Ramil Basinillo were employed by the company as driver, warehouseman, and helper, respectively. Hermosa failed to promptly surrender the ignition key of the companys vehicle after discharging his duties against company's SOP. Thus, he was asked to explain within 24 hours why disciplinary action should not be meted on him. He explained that he kept the ignition key because the vehicle was stalled when its battery broke down. Unsatisfied, the company dismissed him. De Castro was suspected of firing a gun during the blessing of the companys warehouse. He was placed under preventive suspension and temporarily banned from entering the companys premises. He explained that he had no knowledge of the said incident. As his suspension was indefinite and he received no recall order from petitioners, he no longer reported for work. Basinillo alleged that the companys security guard scolded him for not wearing the employee ID. He was dismissed. Thus Hermosa, de Castro, and Basinillo collectively filed a Complaint for illegal dismissal. Labor Arbiter Antonio R. Macam found that private respondents were illegally dismissed. On appeal, the NLRC affirmed the Labor Arbiters decision. It also denied petitioners motion for reconsideration. The appellate court dismissed their oetitione for certiorari. Issue: W/N the respondents were illegally dismissed? Held: Yes. Hermosa was unjustly dismissed. For willful disobedience to be a valid cause for dismissal, the following twin elements must concur: (1) the employee's assailed conduct must have been willful, that is, 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. Both elements are lacking. Also, the alleges company procedure or SOP for leaving the ignition key of the companys vehicles within office premises was not even made known to him. Petitioners failed to prove Hermosa willfully disobeyed the said company procedure. At any rate, dismissal was too harsh a penalty for the omission imputed to him. De Castro was likewise unlawfully terminated. Contrary to petitioners claim, records show that de Castro was not merely suspended. He was dismissed for alleged abandonment of work. To constitute abandonment as a just cause for dismissal, there must be: (a) absence without justifiable reason; and (b) a clear intention, as manifested by some overt act, to sever the employer-employee relationship. Petitioners failed to prove that de Castro abandoned his job. A clear intention to end the employer-employee relationship is missing. He did not report for work simply because he was indefinitely suspended. Moreover, the fact that de Castro filed a case for illegal dismissal against petitioners belies abandonment. In the case of Basinillo, petitioners rely solely on his purported unsworn statement alleging he was never dismissed. However, not having been sworn to, the said document has no probative value. Once a case for illegal dismissal is filed, the burden is

12

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C on the employer to prove that the termination was for valid cause. Petitioners failed to discharge this burden persuasively. Wherefore, the decision is affirmed. __________________________________________________________________ 16. CHALLENGE SOCKS CORPORATION, vs CA & Elvie Buguat G.R. No. 165268 FACTS: The antecedent facts show that respondent Elvie Buguat was hired on January 17, 1997 by petitioner Challenge Socks Corporation as knitting operator.[3] In the course of her employment, she incurred absences and tardiness without prior approval and had been neglectful of her duties.[4] On May 25, 1998, she failed to check the socks she was working on causing excess use of yarn and damage to the socks design. She was suspended for five days and warned that a repetition of the same act would mean dismissal from the service.[5] On February 2, 1999, she committed the same infraction and was given a warning.[6] Despite the previous warnings, Buguat continued to be habitually absent and inattentive to her task. On March 1, 1999, she again failed to properly count the bundle of socks assigned to her. Thus, on March 2, 1999, petitioner terminated her services on grounds of habitual absenteeism without prior leave, tardiness and neglect of work.[7] Thereafter, Buguat filed a complaint for illegal dismissal.[8]The labor arbiter[9] rendered a Decision[10] holding that Buguat was illegally dismissed. The National Labor Relations Commission (NLRC) adopted the findings of the labor arbiter. It denied[13] petitioners appeal and motion for reconsideration. Petitioner filed a petition for certiorari before the Court of Appeals which rendered a Decision on May 11, 2004 reversing and setting aside that of the labor arbiter and the NLRC, the dispositive portion of which provides: The appellate court found that there was just cause for terminating the services of Buguat considering the series of infractions she committed.[15] However, it was noted that petitioner failed to comply with the twin-notice requirement in terminating an employee hence, the dismissal was considered ineffectual.[16] Petitioner was ordered to pay Buguat her back wages computed from the time of her dismissal up to the finality of the decision.[17] ISSUE: 1. Whether Buguats termination is valid. 2. Application of twin notice requirement. HELD: One of the just causes for terminating an employment under Article 282 of the Labor Code is gross and habitual neglect by the employee of her duties. This cause includes gross inefficiency, negligence and carelessness. Such just causes is derived from the right of the employer to select and engage his employees.[18] In the instant case, there is no doubt that Buguat was habitually absent, tardy and neglectful of her duties. Habitual neglect implies repeated failure to perform ones duties for a period of time. Buguats repeated acts of absences without leave and her frequent tardiness reflect her indifferent attitude to and lack of motivation in her work. Her repeated and habitual infractions, committed despite several warnings, constitute gross misconduct. Habitual absenteeism without leave constitute gross negligence and is sufficient to justify termination of an employee. We find the penalty of dismissal from the service reasonable and appropriate to Buguats infraction. Her repeated negligence is not tolerable; neither should it merit the penalty of suspension only. The record of an employee is a relevant consideration in determining the penalty that should be meted out. Buguat committed several infractions in the past and despite the warnings and suspension, she continued to display a neglectful attitude towards her work. 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. It is the totality, not the compartmentalization, of such company infractions that Buguat had consistently committed which justified her dismissal. In the case at bar, petitioner exercised in good faith its management prerogative as there is no dispute that Buguat had been habitually absent, tardy and neglectful of her work, to the damage and prejudice of the company. Her dismissal was therefore proper. The employer has the burden of proving that the dismissed worker has been served two notices: (1) one to apprise him of the particular acts or omissions for which his dismissal is sought, and (2) the other to inform him of his employers decision to dismiss him. Petitioner failed to comply with this requirement, thus: In Agabon v. National Labor Relations Commission, we upheld as valid the dismissal for just cause although it did not comply with the requirements of procedural due process. We ruled that while the procedural infirmity cannot be cured, it should not invalidate the dismissal. However, the employer should be held liable for noncompliance with the procedural requirements of due process. The violation of Buguats right to statutory due process by the petitioner warrants the payment of indemnity in the form of nominal damages in the amount of P30,000, which is appropriate under the circumstances. Conformably, the award of backwages in the present case should be deleted. Instead, private respondent should be indemnified in the amount of P30,000.00 as nominal damages. __________________________________________________________________ 17. CHUA V. NLRC, 453 SCRA 244 FACTS - On June 1, 1995, Dennis Chua was hired as a Professional Medical Representative by Schering-Plough Corporation (SPC), and thereafter became a regular employee on December 1, 1995.

13

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C - As a Professional Medical Representative, he was tasked to promote SPC and its products to physicians, hospitals, paramedics, including trade and government outlets in his assigned territory. - One of the petitioners duties was to submit a Daily Coverage Report (DCR) every Monday, or at least to mail the same to the Field Operations Manager. Furthermore, he was required to have call cards signed by any of the eighty (80) doctors under his coverage to show that he indeed visited them and handed out promotional items. This system enabled the SPC to know how many doctors the petitioner had visited in a week and the number of call cards he was required to submit. - Respondent Roberto Z. Tada, Field Operations Manager of the corporation for the Bicol Region, noticed that the petitioner filed his DCRs late, and in batches at that. Specifically, a batch of DCRs up to January 10, 1997 was filed only on March 13, 1997, while another batch was filed only on March 18, 1997. The petitioner also failed to submit the DCRs for the period covering February 10, 1997 to April 7, 1997. Respondent Tada also found some discrepancies in the DCRs submitted by the petitioner. - On April 6, 1997, respondent Tada confronted the petitioner regarding the said discrepancies, to which Tada merely replied, Pagbigyan mo na lang ako, boss. Tulungan mo na lang ako, boss. - On April 8, 1997, Tada went to the petitioners residence and confiscated all the paraphernalia used by the latter for his fieldwork, including the call cards and medicine samples. The car assigned to the respondent was likewise confiscated. - On April 9, 1997, the petitioner filed an application for a three-day sick leave, but indicated therein that he was going on leave only for two (2) days, from April 10 to 11, 1997. However, after the lapse of his applied leave of absence, the petitioner failed to report for work. - On April 15, 1997, the petitioner had already filed a complaint for illegal dismissal with the National Labor Relations Commission (NLRC) against the SPC, Epitacio Titong, Jr. (as President and General Manager), Danny T. Yu (as Division Manager) and Roberto Z. Tada (as Field Operations Manager - On April 16, 1997, the petitioner received a telegram from the SPC instructing him to report to the office on April 18, 1997 and to see respondent Danny T. Yu who was the Division Manager. The petitioner, however, failed to comply. - On April 18, 1997, respondent Tada sent a Memorandum to the petitioner requiring the latter to explain the late submission of DCRs, insufficiency of the information on the call cards, etc. - The same letter informed the petitioner that he was under preventive suspension effective April 11, 1997 while the case was under investigation. - On May 8, 1997, while the case for illegal dismissal was pending resolution before the arbitration branch of the NLRC, the SPC sent another letter to the petitioner, informing him that his employment was terminated. - On September 30, 1998, Labor Arbiter Ramon Valentin C. Reyes rendered a Decision declaring the petitioners dismissal from employment as illegal. The Labor Arbiter held that the SPC failed to establish any ground for the petitioners dismissal and ordered the SPC to reinstate him. - SPC appealed the decision of the Labor Arbiter to the NLRC. - On October 19, 1999, the NLRC issued a Resolution, finding respondent to have validly dismissed complainant. - The petitioner filed a motion for reconsideration of the said resolution, but the same was dismissed. - The petitioner sought relief from the CA, which affirmed, in toto, the resolution of the NLRC, and consequently denied the petitioners MFR ISSUE WON petitioners dismissal form employment was illegal HELD NO. The petitioners termination from employment was anchored on the following: (a) gross and habitual neglect; (b) serious misconduct; and (c) willful disobedience to the lawful orders of the employer. Thus, it all boils down to the filing of the requisite DCRs due every Monday. As found by both the NLRC and the CA, the petitioner failed to file the DCRs on time on several occasions, and instead filed them in batches. Furthermore, the petitioner failed to submit the DCRs for February 10, 1997 to April 7, 1997. Considering that about ninety percent (90%) of the petitioners work as a medical representative entails fieldwork, such DCRs were vital to his job; the DCRs were the primary basis upon which the petitioners employer could track his accomplishments and work progress. Without the said DCRs, the employer would have no basis to determine if the petitioner was actually performing his assigned tasks or not. - In the same light, the petitioner also failed to submit several doctors call cards, and submitted others which were incomplete; that is, undated although signed by the doctors. It must be stressed that the said call cards were also vital to the petitioners fieldwork. The requirement of asking the doctors to affix their signatures in the call cards, the date of the visit, as well as the samples and promotional items, if any, given to the doctors, enabled the SPC to verify whether such doctors were indeed visited by the petitioner. - Gross negligence under Article 282 of the Labor Code, as amended, connotes want of care in the performance of ones duties, while habitual neglect implies repeated failure to perform ones duties for a period of time, depending upon the circumstances. Clearly, the petitioners repeated failure to submit the DCRs on time, as well as the failure to submit the doctors call cards constitute habitual neglect of duties. Needless to state, the foregoing clearly indicates that the employer had a just cause in terminating the petitioners employment.

14

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C ***But because there was a violation of the petitioners statutory right to two notices prior to the termination of his employment for a just cause, he is entitled to nominal damages of P30,000.00, absent sufficient evidence to support an award for actual or moral damages. (In line with the ruling in Agabon) Disposition The decision of the Court of Appeals is affirmed with modification that petitioner is entitled to above stated award for nominal damages. __________________________________________________________________ 18. PAGUIO TRANSPORT CORP V. NLRC, 294 SCRA 657 In dismissing the Petition, the Supreme Court reiterates the following doctrines: (1) the boundary system used in taxi (and jeepney) operations presupposes an employeremployee relation; (2) the employer must prove just (or authorized) cause and due process to justify dismissal of an employee; (3) strained relations must be demonstrated as a fact; and (4) back wages and reinstatement are necessary consequences of illegal dismissal. Facts :Complainant Wilfredo Melchor was hired by respondent company as a taxi driver on 25 December 1992 under the (b)oundary (s)ystem. He (was) engaged to drive the taxi unit assigned to him on a 24-hour schedule per trip every two (2) days, for which he used to earn an average income from P500 to P700 per trip, exclusive of the P650.00 boundary and other deductions imposed on him. On 24 (sic) November 1993, complainant allegedly met a vehicular accident along Quirino Avenue near the PNR Station and Plaza Dilao when he accidentally bumped a car which stopped at the intersection even when the traffic light was green and go. After he submitted the traffic accident report to the office of respondents, he was allegedly advised to stop working and have a rest. After several days(,) he allegedly reported for work only to be told that his service was no longer needed. Hence, the complaint for illegal dismissal, among others. Respondent(s) for their part maintained that complainant was not illegally dismissed, there being in the first place no employer-employee relationship between them. In amplification, it was argued that the element of control which (was) a paramount test to determine the existence of such a relationship (was) lacking. So too, it argued the element of the payment of compensation. Considering that in lieu of the latter, payment of boundary is instead made allegedly makes the relationship between them of a waseagreement (sic). Respondents then argued that even if an employer-employee relationship were to be presumed as present, still complainants termination arose out of a valid cause and after he refused to articulate his stand on the investigation being conducted on him. Respondents then harped on the supposed three occasions when complainant figured in a vehicular accident involving the taxi unit he was driving, viz: On August 3, which resulted in damages to the respondent in the amount of P150.00; On August 4 which again resulted (in) the damages to the respondent in the amount of P615.00; and again on 4 November 1993, the mishap costing the respondents this time P25,370.00 in damages. As a result of the alleged compounded damages which the respondents had to shoulder on account of the supposed reckless driving of the complainant, the former was allegedly left with no alternative but to ask complainants explanation why he should still be allowed to drive. Complainant, despite several chances, allegedly failed to do so.[4] Ruling of the NLRC: The NLRC held that private respondent was an illegally dismissed employee of petitioner. by private respondent. Issues Petitioner raises the following issues: a. Whether or not public respondent Commission acted in excess of jurisdiction and/or with grave abuse of discretion amounting to lack of jurisdiction in ordering the reinstatement of private respondent with full backwages, despite its strained relations with the petitioner and the reinstatement would, in effect, be inimical to the interest of the latter in particular, and to the riding public in general; b. Whether or not public respondent acted in excess of jurisdiction and/or with grave abuse of discretion in refusing to reconsider its decision and resolution complained of despite the facts prevailing to support the reconsideration.[10] In resolving the petition, we shall address the following points: (1) employer-employee relation, (2) presence of just cause, (3) due process, (4) strained relationship, and (5) propriety of reinstatement and back wages. Chanroblespublishingcompany Held First Issue: Employer-Employee Relation Second Issue: Just Cause Petitioner also asserts that private respondents involvement in three vehicular accidents within a span of several months constitutes just cause for his dismissal. It alleges that, according to the police report concerning the most recent and serious vehicular mishap, it was private respondent who was at fault and that the city prosecutor of Quezon City recommended that an Information for reckless imprudence resulting in damage to property be filed against him. Petitioner, however, did not submit any proof to support these allegations. Well-settled is the rule that the employer has the burden of proving that the dismissal of an employee is for a just cause. Private respondents admission that he was involved in the November 4, 1993 accident did not give petitioner a just cause to dismiss him. Mere involvement in an accident, absent any showing of fault or recklessness on the part of an employee, is not a valid ground for dismissal. Third Issue: No Due Process Petitioner insists that private respondent was accorded due process, because he was allowed to explain his side and to show cause why he should still be allowed to act as one of petitioners drivers. This does not persuade. The Court has consistently held that in the dismissal of employees, the twin requirements of notice and hearing are essential elements of due process. The employer must furnish the worker two written notices: (1) one to apprise him of the particular acts or omissions for which his dismissal is sought and (2) the other to inform him of his employers decision to dismiss him. As to the requirement of a hearing, the essence of due process lies simply in an opportunity to be

15

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C heard, and not always and indispensably in an actual hearing. In the present case, petitioner failed to present proof, other than its bare allegations, that it had complied with these requirements. We reiterate: the burden of proof rests on the employer. Private respondent, in fact, was not given notice that he was being dismissed. When ordered to explain the vehicular accident that happened on November 4, 1993, he was not informed that petitioner was contemplating his dismissal and that his involvement in said vehicular accident was the cause thereof. Private respondent was merely asked to explain the vehicular accident per se, not his defense against a charge of dismissal arising from the vehicular accident. He became aware of his employers intention to dismiss him only when he was actually told not to report for work anymore. Fourth Issue: Strained Relations Notwithstanding its failure to prove just cause and due process in the dismissal of private respondent, petitioner seeks to bar his reinstatement by invoking the doctrine of strained relations. It contends that as a result of private respondents reckless and incompetent manner of driving, compounded by the damages suffered by petitioner in terms of repairs, related expenses, and the institution of the instant case, the relationship between the parties are so strained as to preclude a harmonious working atmosphere to the prejudice of the petitioner as well as private respondent. Strained relations must be demonstrated as a fact. Petitioner failed to do so. Its allegation that private respondent was incompetent and reckless in his manner of driving, which led to his involvement in three vehicular accidents, is not supported by the records. As earlier noted, no evidence was properly submitted by petitioner to prove or give credence to his assertions. Thus, Respondent NLRC ruled: Despite allegation on the matter, not an iota of proof was presented to establish the claim. This observation equally applies to the allegation that complainants, in three (3) occasions had figured in (a) vehicular accident due to his reckless driving. Because the claim of petitioner has no factual basis, the doctrine on strained relations cannot be applied in this case. Moreover, the filing of the Complaint for illegal dismissal does not by itself justify the invocation of this doctrine. As the Court held in Capili vs. NLRC: (T)he doctrine on strained relations cannot be applied indiscriminately since every labor dispute almost invariably results in strained relations; otherwise, reinstatement can never be possible simply because some hostility is engendered between the parties as a result of their disagreement. That is human nature. __________________________________________________________________ 19. CARMELITA V. SANTOS, G.R. No. 149416, March 14, 2003 vs. SAN MIGUEL CORPORATION Facts: San Miguel Corporation (SMC) appointed petitioner Carmelita V. Santos as Finance Director of its Beer Division for Luzon Operations. On September 6, 1989, respondent's Cash Department issued a Memorandum prohibiting the encashment of personal checks at respondent's Plants and Sales Offices. On January 10, 1991, respondent SMC, through its Cash Management Department, noticed that petitioner encashed her three (3) personal checks in various Metro Manila Sales Offices. Two checks were dishonored by the bank because of insufficient fund and the other one was accepted for payment. Respondent commenced an audit investigation of the personal checks encashed by petitioner at its sales offices. Pending the audit investigation, petitioner agreed to take a fifteen-day vacation leave from January 25 to February 14, 1991. On January 29, 1991, petitioner received from respondent an inter-office memorandum requiring her to explain in writing why no disciplinary action should be taken against her in view of her unauthorized encashment of her three personal checks at respondent's sales offices. In a reply-memorandum, petitioner admitted that she encashed three personal checks at respondent's sales offices but claimed that such act was not irregular since all personnel in respondent's Beer Division were allowed to encash their personal checks at any sales office upon clearance from the region management concerned. She stated that her encashment of personal checks had prior clearance. Meanwhile, respondent obtained a copy of the audit results and learned that aside from petitioner's reported encashment of three personal checks, she had previously encashed fifty (50) personal checks from June 13, 1989 to January 19, 1991 in varying amounts. After receiving such report, respondent SMC formed an Investigating Panel to conduct a full-blown investigation of petitioner's encashment of personal checks and to determine: (1) whether the region management gave prior consent to the transactions; (2) whether the person or persons who accepted or encashed the personal checks were in fact authorized to do so; (3) if there is any policy, procedure and/or accommodation for the encashment of personal checks and the extent/amount and frequency of such; and (4) the loss or damage accruing to respondent, if any. In the meantime, on or February 15, 1991, petitioner returned from her vacation leave and reported for work. To her surprise, she found that she had been relieved of her present assignment/position until the conclusion of the investigation. At the first investigative hearing, petitioner appeared but requested a postponement of five days to enable her to submit a supplemental letter to the Investigating Panel. Despite notice, she refused to attend subsequent hearings. The Investigating Panel considered her refusal as a waiver of her right to be heard and thus continued the investigation in her absence. Respondent adopted the findings of the Investigating Panel and informed petitioner of her termination from employment for abuse of position as Finance Director, engaging in highly irregular transactions to the detriment of the company and employer's loss of trust and confidence. Five days before the end of the administrative investigation, or on March 15, 1991, petitioner filed with the Labor Arbiter a complaint for constructive dismissal against respondent SMC and the Chairman of the Investigating Panel. The complaint was later amended to illegal dismissal. The labor arbiter dismissed the case, however, for humanitarian considerations, respondent is directed to give complainant financial assistance equivalent to one month pay. Petitioner interposed an appeal to the NLRC. The NLRC held that respondent SMC was estopped from questioning petitioner's encashment of personal checks, having allowed such practice for several years prior to the present case. SMC filed a motion for reconsideration but it was denied. Respondent filed with the CA a petition for certiorari under Rule 65 of the Revised Rules of Court, with prayer for a temporary restraining order and/or preliminary

16

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C injunction, rendering its decision annulling and setting aside that of the NLRC. Petitioner filed with the CA a motion for reconsideration but was denied. Issue : Whether or not petitioner was dismissed from employment without just cause and violated her right to due process. Held : Under the Labor Code, a valid dismissal from employment requires that: (1) the dismissal must be for any of the causes expressed in Article 282 of the Labor Code and (2) the employee must be given an opportunity to be heard and to defend himself. Article 282(c) of the same Code provides that "willful breach by the employee of the trust reposed in him by his employer" is a cause for the termination of employment by an employer. This ground should be duly established. Substantial evidence is sufficient as long as such loss of confidence is well-founded or if the employer has reasonable ground to believe that the employee concerned is responsible for the misconduct and her act rendered her unworthy of the trust and confidence demanded of her position. It must be shown, though, that the employee concerned holds a position of trust. The betrayal of this trust is the essence of the offense for which an employee is penalized. Prolonged practice of encashing personal checks among respondent's payroll personnel does not excuse or justify petitioner's misdeeds. Petitioner's willful and deliberate acts were in gross violation of respondent's policy against encashment of personal checks of its personnel, embodied in its Cash Department Memorandum dated September 6, 1989. She cannot feign ignorance of such memorandum as she is duty-bound to keep abreast of company policies related to financial matters within the corporation. Equally unmeritorious are her claims that the acts complained of are regular, being with the knowledge and consent of her superiors and that she is being charged because she resisted the sexual advances of her superior. Suffice it to state that she could have proved these matters during the investigation had she attended the proceedings. On petitioner's contention that she was denied due process . In this case, petitioner was required to explain in writing why no disciplinary action should be taken against her. She was also notified that a full-blown administrative investigation will be conducted and was advised that she should be represented by counsel. She submitted to the Investigating Panel a letter-explanation and a supplemental response to the administrative complaint against her. At her request, the investigation was postponed twice to enable her to procure the services of counsel. Yet, she vehemently refused to participate in the administrative investigation. She cannot now claim denial of due process considering that she was afforded the opportunity to be present (with counsel) during the investigation and to present her evidence. The essence of due process is that a party be afforded a reasonable opportunity to be heard and to submit any evidence he may have in support of his defense. Procedural due process requires the employer to give the employee two notices. First is the notice apprising him of the particular acts or omissions for which his dismissal is sought. Second is the subsequent notice informing him of the employer's decision to dismiss him. Records show that the petitioner received the required twin notices. __________________________________________________________________ 20. PHILIPPINE NATIONAL CONSTRUCTION CORP. V MATIAS 458 SCRA 148 [G.R. No. 156283] FACTS:Respondent Rolando Matias was employed by Construction and Development Corporation of the Philippines (CDCP) on July 16, 1975 as Chief Accountant and Administrative Officer. During his employment with the company, various parcels of land situated at Don Carlos Bukidnon were placed in the names of certain employees as trustees for the purpose of owning vast tracts of land more than the limit a corporation can own which were primarily intended for CDCP agricultural businesses. By internal arrangement documents transferring back the properties to the corporation were executed. A land containing an area of 117,750 square meters was registered in the name of respondent on April 24, 1980. In 1981, petitioner transferred to the main office of the CDCP as Head of the Corporate Accounting Department. In 1984, the loans of CDCP from various government entities were converted to equity thus making it a government owned or controlled corporation, and the name of CDCP was changed to Philippine National Construction Corporation (PNCC). Under a new set up, PNCC offered a retrenchment program and on December 31, 1984 petitioner availed of the said program. In July 1992, two former CDCP employees, namely Reynaldo Tac-an and Luciano Tadena went to the house of Matias and brought with them duly accomplished documents and Special Power of Attorney for his signature and informed him that the lands in Bukidnon under his name with all the others were invaded by squatters, and that the said land were covered by the Comprehensive Agrarian Reform Program (CARP) where Matias name was included in the list of landowners. Matias reluctantly signed the document and after six months, he signed an acknowledgment receipt of P100,000.00. On December 18, 1992, the Register of Deeds of Bukidnon cancelled the Original Certificate of Title originally registered in the name of Matias and issued a new Transfer Certificate of Title in the name of the Republic of the Philippines. The transfer of said parcel of land was made possible because Rolando Matias and Elena Esmeralda Matias received managers checks from the Land Bank of the Philippines in the amount of P102,355.96 and P219.22 and bond worth P203,478.48 as payment of Land Transfer Acquisition in November 1992. On August 12, 1996, Matias was rehired by PNCC as Project Controller in Zambales PMMA Project. Subsequently, he headed the Core Group at the Central Office, Mandaluyong City. Not long after, Mr. Felipe C. Al[d]ay, Head of the Realty Management Group of PNCC invited Matias to his office and showed him a listing of parcels of land in the name of different persons with the corresponding status including the latters name. On the basis of the listing, Mr. Alday told Matias that the transfer of the property registered in the latters name was not yet consummated by the LBP and then requested Matias to execute a Deed of Assignment in favor of PNCC pertaining to the said property. On September 16, 1997, Matias executed an Assignment of Real Property in his capacity, as registered owner of a parcel of land covered by OCT No. P-11315, in favor of PNCC for a consideration of P5,900.00. In the [D]eed of [A]ssignment, Matias

17

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C guaranteed in writing that the Assignor hereby warrants that the above-described parcel of land is free from any lien or encumbrance. In December 1997, Matias made a verbal follow-up as to the status of his appointment at the Central Office and was advised that it be already for signature by the President. A letter dated June 1, 1998 followed this. On April 20, 1998, a memorandum was issued to Matias by PNCC through its Head, Administration Division, Ms. Janice Day E. Alejandro, directing the former to explain in writing why none of the following actions, falsification, estafa, dishonesty, and breach of trust and confidence, should be taken against him in connection with the Deed of Assignment. In due time, Matias submitted his written explanation. On June 1, 1998, Ms. Alejandro first demanded his resignation in lieu of termination. Thereafter, a letter advising him of his termination from the service on the ground of loss of trust and confidence effective June 15, 1998 was served. Hence, Matias filed a complaint for illegal dismissal and money claims against PNCC, on July 8, 1998 alleging that the dismissal on the ground of loss of trust and confidence was without basis. After hearing, the labor arbiter held that Matias had been illegally dismissed. The LA thus ordered PNCC to reinstate Matias to the employees former position or to a substantially equivalent one, without loss of seniority rights, benefits and privileges; and to pay back wages and attorneys fees. On appeal, however, sufficient basis for petitioners loss of trust and confidence in Matias was found by the NLRC. The CA held that herein respondent had not acted with malice, deceit and bad faith when, in 1997, he executed the Deed of Assignment and guaranteed that the subject land was free from all liens and encumbrances. The CA further noted that PNCC had acted anomalously in assigning its properties to different employees, purposely to evade the compulsory coverage of the Comprehensive Agrarian Reform Program (CARP). For having acted with fraud, petitioner had not come with clean hands in seeking sanctions against respondent. ISSUE: WON respondent is illegally dismissed for breach of trust reposed in him by his employer. HELD: No. To constitute a valid cause to terminate employment, loss of trust and confidence must be proven clearly and convincingly by substantial evidence. To be a just cause for terminating employment, loss of confidence must be directly related to the duties of the employee to show that he or she is woefully unfit to continue working for the employer. Undeniably, the position of project controller -- the position of respondent at the time of his dismissal -- required trust and confidence, for it related to the handling of business expenditures or finances. However, his act allegedly constituting breach of trust and confidence was not in any way related to his official functions and responsibilities as controller. In fact, the questioned act pertained to an unlawful scheme deliberately engaged in by petitioner in order to evade a constitutional and legal mandate. It has oft been held that loss of confidence should not be used as a subterfuge for causes which are illegal, improper and unjustified. It must be genuine, not a mere afterthought to justify an earlier action taken in bad faith.Be it remembered that at stake here are the sole means of livelihood, the name and the reputation of the employee. Thus, petitioner must prove an actual breach of duty founded on clearly established facts sufficient to warrant his loss of employment. __________________________________________________________________ 21. VITARICH CORPORATION, DANILO SARMIENTO and ONOFRE SEBASTIAN, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION AND ISAGANI E. RECODO, respondents. G.R. No. 121905 May 20, 1999 Facts: Private respondent Isagani E. Recodo was hired by VITARICH, a feeds manufacturing corporation, as an Accounting Clerk in its office in Marilao, Bulacan. In 1979, he was promoted as Accounting Supervisor, then in 1986 as Sales Superintendent while assigned in Davao City. In 1988 he became the Sales Manager for Western Visayas based in Iloilo City with a monthly salary of P18,200.00. When petitioner Onofre Sebastian took over in June 1992 as Division head he was faced with a high volume of account receivables (A/R) accumulated during the time of Ben Cruz, his predecessor. To address the problem petitioner Sebastian and respondent Recodo conferred in the middle of July 1992 with the latter being instructed to cut down the accountabilities of Rex Cordova, a company salesman in Iloilo. Thereafter Recodo advised Cordova to reduce his technical credit extensions. In less than a month, the amount of account receivables was reduced from P800,000.00 to P205,000.00. However on 27 August 1992 Recodo was asked again to explain within forty-eight (48) hours why he should not be terminated for failure to ground Rex Cordova in accordance with the 4 August 1992 memorandum of vice president Onofre Sebastian. The other grounds cited for terminating Recodo were his failure to reduce Cordova's A/R driver, the allowance of extension of his credit line, as well as the misrepresentation of his outstanding A/R. 11 The memorandum of 4 August 1992 instructed Recodo to confirm all A/R drivers who were already two (2) weeks overdue to preclude any ghost deliveries and to ground all salesmen with A/R drivers who were already thirty (30) days old so that they could only resume deliveries after accounts were collected or payment arrangements were made. In his 5 September 1992 letter Recodo explained that only the first paragraph of the faxed memorandum was readable so he had it verified. He only learned its full context when he was negotiating for the security of Cordova's past accounts. Thus, he postponed grounding Cordova until 20 August 1992 in order to bring about positive results. The negotiation reduced Cordova's A/R driver from P800,000.00 to P250,000.00 as of 19 August 1992 which amount would be further lowered to P150,000.00 by September. The alleged misrepresentation in the figures given was not deliberate but was merely a mental lapse due to tension at work. After investigation, E.T. Enriquez, Head of Personnel, submitted his report on Recodo's alleged insubordination. Enriquez found that there was "no defensible ground for terminating (Recodo's) services." He cited as reasons therefor the non-documentation of any warning given to Recodo to justify any loss of trust and confidence in him. 14 Nevertheless, VITARICH terminated Recodo on 15 October 1992 for violation of the 4 August 1992 Memorandum including policies on credit extensions and cash advances.

18

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C On 13 October 1992, Recodo filed a complaint for illegal dismissal, non-payment of managerial incentive bonus and for moral and exemplary damages. Initially the complaint was directed against VITARICH and its president Danilo Sarmiento, but on 21 January 1993 vice president Onofre Sebastian was also included as respondent. On 23 June 1993 the Labor Arbiter adjudged VITARICH and its impleaded officers guilty of illegal dismissal. Tthe Labor Arbiter significantly found that Recodo's explanation to the charges imputed to him by VITARICH was sincere and reasonable and that any breaches in company policies he might have committed were only ordinary, not willful to warrant his dismissal. The NLRC affirmed the decision of the Labor Arbiter. Hence, this petition. Issue: Whether or not the delay in the implementation by Recodo of the memorandum constitutes disobedience and whether or not such was willful to merit loss of trust and confidence to justify dismissal. Held: NO. In AHS/Philippines, Inc. v. CA, the Court held that willful disobedience of the employer's lawful orders, as a just cause for dismissal of an employee, envisages the concurrence of at least two (2) requisites: the employees assailed conduct must be willful or intentional, the willfulness being characterized by a wrongful and perverse attitude; and 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. In the case at bar, the non-compliance by Recodo was not an open defiance but as one of the discretions which he had to take under the circumstances in his capacity as Sales Manager which to his mind would better serve the interest of the company. True enough, his act turned to be more beneficial rather than being prejudicial to the company. While an employer is allowed wide latitude to dismiss managerial employees on loss of trust and confidence, still the loss thereof must have some basis and must be proved by the employer otherwise the social justice policy of the labor laws and the Constitution will be for naught. This very norm of social justice demands the presumption of good faith credited to the employees in the performance of their duties upon failure of their employer to prove just cause for their dismissal. In Midas Touch Food Corporation v. NLRC, the Court declared the guidelines for the application of the doctrine of loss of confidence are: (a) loss of confidence which should not be simulated; (b) it should not be used as a subterfuge for causes which are improper, illegal or unjustified; (c) it should not be arbitrarily asserted in the face of overwhelming evidence to the contrary; and, (d) it must be genuine, not a mere afterthought to justify earlier action taken in bad faith. __________________________________________________________________ 22. ATLAS CONSOLIDATED MINING & DEVELOPMENT CORP V. NLRC, 290 SCRA 479 FACTS: Villacencio worked as a general foreman for Atlas. On one occasion, Engineer Sanchez wrote a memorandum asking Villacencio to be investigated for certain alleged anomalies at the Magdugo Tailings Field Office. Villacencio was charged with acts of malfeasance consisting of: 1) Withdrawal of company-owned gasoline for the refuelling of his personal jeep; 2) Use of company resources for the assembly of a jeep not belonging to the company; 3) Granting of authority to non-company personnel to withdraw company-owned stocks. He was found guilty of the first two charges resulting to his dismissal. He lodged a complaint against Atlas before the Regional Arbitration Board. Meanwhile, Atlas filed an information for estafa against Villacencio which prospered, resulting in the latters conviction to which he appealed. Due to the prosecutions incompetency in proving his guilt, the appellate court acquitted him. Villacencios complaint for illegal dismissal was dismissed by the labor arbiter to which he appealed from to the NLRC, the latter overturning the decision rendered. ISSUE: Was Villacencio illegally dismissed? RULING: In illegal dismissal cases, the employer bears the burden of proof to show that the dismissal is for a just or authorized cause. The facts of the case show that Villacencio was an upstanding employee, a model of sorts, who handled his job well enough to be recognized by his peers. However, there were some who didnt like him for being such a stickler for the rules. Those who didnt like him made assertions of falsehood in their testimony. Loss of trust and confidence to be a valid ground for an employee's dismissal must be clearly established. We hold that the proofs presented by the petitioner are insufficient to show dishonesty on the part of the private respondent. We reject the ruling of the Labor Arbiter that since private respondent neglected to inspect the logbook and thus failed to discover the irregularity, he committed breach of trust. Settled is the rule that under Article 283(c) of the Labor Code, the breach of trust must be willful. A breach is willful if it is done intentionally, knowingly and purposely, without justifiable excuse, as distinguished from an act done carelessly, thoughtlessly, heedlessly or inadvertently. It must rest on substantial grounds and not on the employer's arbitrariness, whims, caprices or suspicion; otherwise, the employee would eternally remain at the mercy of the employer. The assailed decision of the NLRC was affirmed. __________________________________________________________________ 23. LEONARDO V. NLRC, 333 SCRA 589 FACTS: Petitioner was a mechanic employed by Reynaldos Marketing Corporation. He was transferred to another plant of the company, and his supervisors allowance correspondingly withdrawn, allegedly due to his failure to meet his sales quota. He then filed acomplaint for illegal dismissal, alleging constructive dismissal. Reynaldos denied the charge; it was simply carrying out a policy designed to encourage work efficiency and competitiveness by giving out extra allowances and choice assignments to employees who meet the required quota. Failure to maintain such quota simply means loss of the assignment and extra allowances. ISSUE: Whether or not petitioner was constructively dismissed.

HELD: No. Constructive dismissal is an involuntary resignation resorted to by an employee when his continued employment becomes impossible, unreasonable, or

19

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C unlikely or when there is demotion in rank or diminution in pay, or when a clear determination, insensibility or disdain by the employer becomes unbearable. In the case at bar, there was a demotion and corresponding decrease in pay, but it was for cause (failure to meet the required quota). The right to demote falls within the employers prerogative, since anemployer may set employment standards and appropriate sanctions for failure to meet the latter. __________________________________________________________________ 24. FLOREN HOTEL V. NLRC, 458 SCRA 128 FACTS At the time of their termination, private respondents Roderick A. Calimlim, Ronald T. Rico and Jun A. Abalos were working in the hotel as room boys, private respondent Lito F. Bautista as front desk man, and private respondent Gloria B. Lopez as waitress. They all started working for the hotel in 1993, except for Jun A. Abalos who started only in 1995. - In the afternoon of June 6, 1998, petitioner Dely Lim randomly inspected the hotel rooms to check if they had been properly cleaned. When she entered Room 301, she found private respondent Bautista sleeping half-naked with the air-conditioning on. Lim immediately called the attention of the hotels acting supervisor, Diosdado Aquino, who had supervision over Bautista. Lim admonished Aquino for not supervising Bautista more closely, considering that it was Bautistas third offense of the same nature. When she entered Room 303, she saw private respondents Calimlim and Rico drinking beer, with four bottles in front of them. They had taken these bottles of beer from the hotelscoffee shop. Like Bautista, they had switched on the airconditioning in Room 303 - That same afternoon, Dely Lim prepared a memorandum for Bautista, citing the latter for the following incidents: (1)sleeping in the hotel rooms; (2) entertaining a brother-inlaw for extended hours during duty hours; (3) use of hotel funds for payment of SSS loan without management consent; (4)unauthorized use of hotels air-con; and (5) failure to pay cash advance in the amount of P4,000. - Dely Lim tried to give Bautista a copy of the memorandum but Bautista refused to receive it. Bautista then went on absence without leave. Calimlim and Rico, embarrassed by the incident went home. When they returned to work the next day, they were served with a notice of suspension for one week. - Like Bautista, they refused to receive the notice of suspension, but opted to serve the penalty. Upon their return on June 15,1998, they saw a memorandum dated June 13, 1998 on the bulletin board announcing (a) the suspension as room boys of Calimlim and Rico, or alternately, (b) returning to work on probation as janitors for the following reasons: unsatisfactory work, having a drinking spree inside the hotels rooms, cheating on the Daily Time Record, being absent without valid reason, leaving work during duty time, tardiness, and sleeping on the job. The memorandum also included Calimlim and Ricos new work schedule.- Calimlim and Rico submitted handwritten apologies and pleaded for another chance, before they went AWOL- On June 25, 1998, Calimlim, Rico and Bautista filed separate complaints, for illegal dismissal and money claims, before the Labor Arbiter. Abalos and Lopez later also filed separate complaints for underpayment of wages, non-payment of their13th month pay, and service incentive leave pay. On July 7,1998, after they stopped working, Abalos and Lopez amended their complaints. They claimed that petitioners orally dismissed them when they refused to withdraw their complaints ISSUE: WON the private respondents were illegally dismissed. HELD YES- Petitioners claimed that all five private respondents were guilty of abandoning their jobs. Thus, it was incumbent upo npetitioners to show that the two requirements for a valid dismissal on the ground of abandonment existed in this case. Specifically, petitioners needed to present, for each private respondent, evidence not only of the failure to report for work or that absence was without valid or justifiable reasons, but also of some overt act showing the private respondents loss of interest to continue working in his or her job. If it was true that private respondents abandoned their jobs, then petitioners should have served them with a notice of termination on the ground of abandonment as required under Sec. 2, Rule XIV, Book V, Rules and Regulation Implementing the Labor Code, in effect at that time. Said Section 2 provided that: Notice of Dismissal. Any employer who seeks to dismiss a worker shall furnish him a written notice stating the particular acts or omission constituting the grounds for his dismissal. In cases of abandonment of work, the notice shall be served at the workers last known address. But petitioners failed to comply with the foregoing requirement, thereby bolstering further private respondents claim that they did not abandon their work but were illegally dismissed.- None of the private respondents in this case had any intention to severe their working relationship. Just days after they were dismissed, private respondents filed complaints to protest their dismissals. The well-established rule is that an employee who takes steps to protest his layoff cannot be said to have abandoned his work. That private respondents all desired to work in the hotel is further shown by the fact that during the proceedings before the Labor Arbiter, shortly after private respondents received petitioners position paper where the latter averred that private respondents were never terminated, private respondents filed a manifestation and motion asking that petitioners be ordered to allow them back to work. This is nothing if not an unequivocal expression of eagerness to resume working. Private respondents should therefore be reinstated. Article 279 of the Labor Code gives to Calimlim and Rico the right to reinstatement without loss of seniority rights and other privileges or separation pay in case reinstatement is no longer possible, and to his full backwages, inclusive of allowances and other benefits. __________________________________________________________________ 25. BATONGBACAL V. ASSOCIATED BANK, 168 SCRA 600 Facts: Petitioner Bienvenido R. Batongbacal, a lawyer, was appointed assistant vicepresident in Citizens Bank and Trust Company "to assist the Senior Vice-President as directly in charge of the Loans and Discounts Department" and, concurrently, as acting manager of the personnel and administration department in "lieu of the Vice-President and Treasurer." Said appointment was without a definite period. Citizens Bank and Trust Company merged with the Associated Banking Corporation. The merged corporate entity later became known as Associated Bank. In the new bank, petitioner resumed his position as assistant vice-president.

20

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C Petitioner later on learned that the salary and allowances he was receiving were very much below the standard remuneration of the bank's other assistant vice presidents. Consequently, he wrote the bank's board of directors requesting that he be paid "the accrued salary and allowance arbitrarily withheld from him." Meanwhile, the Board of Directors issued a resolution requiring Bank officers at the Head Office and the Branches with corporate rank of Manager and higher to submit their resignations IMMEDIATELY. Petitioner, however, did not submit his courtesy resignation. Nevertheless, he made repeated requests for the reconsideration of the bank's decision to terminate his employment. His requests were ignored. Hence, he filed a complaint for illegal dismissal and damages in the arbitration branch of the National Labor Relations Commission (NLRC). Issue: WON the petitioner was validly dismissed. ISSUES:Whether dismissal was valid? Held: No. While it may be said that the private respondent's call for courtesy resignations was prompted by its determination to survive, the manner by which it pursued its goal is deemed illegal. By directing its employees to submit letters of courtesy resignation, the bank in effect forced upon its employees an act which they themselves should voluntarily do. It should be emphasized that resignation per se means voluntary relinquishment of a position or office. Adding the word "courtesy" did not change the essence of resignation. Petitioner's dismissal was effected through a letter "accepting" his resignation. Private respondent rationalizes that this was done, even if petitioner did not actually submit such letter, so as not to jeopardize his chances of future employment. But it is also clear from its pleadings that private respondent terminated petitioner's employment for insubordination in view of his failure to comply with the order to submit his letter of courtesy resignation. We hold, however, that insubordination may not be imputed to one who refused to follow an unlawful order. Private respondent asserts that petitioner's refusal to submit his letter of courtesy resignation was "sufficient reason to distrust him." Loss of confidence as a ground for dismissal must be supported by satisfactory evidence. Even with respect to managerial employees who, under Policy Instructions No. 8, may be dismissed for lack of confidence, loss of trust must be substantiated and clearly proven. The record fails to show any valid reasons for terminating the employment of petitioner. There are no proofs of malfeasance or misfeasance committed by petitioner which jeopardized private respondent's interest. The latter's allegations that petitioner was "purged" because he sabotaged the bank and that he "contributed, directly or indirectly" to its downfall are mere subjective conclusions unsubstantiated by hard facts. To clothe with legality petitioner's dismissal for his failure to submit his letter of courtesy resignation is to add a ground for termination of employment to the provisions of the Labor Code. __________________________________________________________________ 26. STELLAR INDUSTRIAL SERVICES VS. NLRC |G.R. No. 117418 | Jan 24, 1996 HELD:No. There was substantial compliance with company rules and regulations by Private Respondent. He immediately informed his supervisor at MBC-PAL of the fact that he could not report for work by reason of illness. He complied with the company rule that in case of illness necessitating absence of two days or more, the office should be informed beforehand about the same, that is, on the first day of absence. Since the cause of his absence could not have been anticipated, to require prior approval would be unreasonable. On this score, then, no serious misconduct may be imputed to Pepito. Necessarily, his dismissal from work, tainted as it is by lack of just cause, was clearly illegal. More importantly, private respondent duly presented the requisite medical certificate. In addition, private respondent's absences were incurred with due notice and compliance with company rules and he had not thereby committed a "similar offense" as those he had committed in the past. __________________________________________________________________ 27. SANTOS V. NLRC, 287 SCRA 117 (GR 115795) FACTS: Petitioner Jose Santos, a married man, was employed by Hagonoy Institute Inc. as a teacher. During his employment as a teacher, he started an illicit relationship with another teacher-- Arlene Martin, also married. Upon knowledge of such illicit relationship, the school recommended Mrs. Martin to take a leave of absence which she refused thus the school forcibly barred her from the school effectively terminating her. Martin sued for illegal dismissal but the Labor Arbiter (LA) dismissed the case but with an award for financial assistance. Upon appeal to the NLRC, it modified the LA's decision and ruled that there was illegal dismissal then awarded for the payment of backwages and separation pay because Martin's dismissal was without due process. On the other hand, the school created a committee to investigate the veracity of the rumors of the illicit relationship of Mr. Santos, the committee found the illicit relationship to be true thus it filed an administrative case for immorality against Mr. Santos and for him to present his side. The administrative case lasted for five months with the Board of Directors deciding to terminate Mr. Santos' employment. FACTS: Stellar Industrial Services, Inc., an independent contractor engaged in the business of providing manpower services, employed private respondent Roberto H. Pepito as a janitor assigned to work at the Maintenance Base Complex of the Philippine Airlines (MBC-PAL). According to petitioner, private respondent's years of service at MBC-PAL were marred by various infractions of company rules ranging from tardiness to gambling. Stellar finally terminated private respondent's services because of what it termed as Pepito's being Absent Without Official Leave (AWOL). Private respondent had insisted in a letter to petitioner dated December 2, 1990, to which was attached what purported to be a medical certificate, that during the period in question he was unable to report for work due to severe stomach pain and that, as he could hardly walk by reason thereof, he failed to file the corresponding official leave of absence.

21

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C Aggrieved, Santos sued for illegal dismissal with the LA but the case was dismissed for lack of merit but awarded financial assistance. Santos appealed to the NLRC but the commission found no reason to reverse and dismissed the appeal and the subsequent reconsideration. Hence an action for certiorari under Rule 65. ISSUE: Whether or not the illicit relationship between the petitioner and Mrs. Martin could be considered immoral as to constitute just cause to terminate an employee? RULING: YES. In order to constitute a valid dismissal, two requisites must concur: (a) the dismissal must be for any of the causes expressed in Art. 282 of the Labor Code, and (b) the employee must be accorded due process. The Supreme Court found both requisites to have been satisfied. Moreover, it is provided under Section 94 of the Manual of Regulations for Private Schools: Section 94. Causes of Terminating Employment. In addition to the just cases enumerated in the Labor Code, the employment of school personnel, including faculty, may be terminated for any of the following causes: xxx xxx xxx E. Disgraceful or immoral conduct. 28. APARENTE SR V NLRC (COCA-COLA BOTTLERS PHIL) Private respondent, in justifying the termination of the petitioner, contends that being a teacher, he must live up to the high moral standards required of his position. In other words, it asserts that its purpose in dismissing the petitioner was to preserve the respect of the community towards the teachers and to strengthen the educational system. On the other hand, petitioner merely argues that the alleged illicit relationship was not substantially proven by convincing evidence by the private respondent as to justify his dismissal. On the contrary, the illicit relations was testified to by nine witnesses, six of whom were his co-teachers and basic is the rule that when factual findings by the NLRC, particularly when it coincides with those by the Labor Arbiter, are accorded respect, even finality, and will not be disturbed for as long as such findings are supported by substantial evidence. A mere denial or negative defense of Mr. Santos, if unsubstantiated by clear and convincing evidence, is a negative and self-serving evidence which has no weight in law and cannot be given greater evidentiary value over the testimony of credible witnesses who testified on affirmative matters. The Court then went on to elaborate on the role of a teacher as an example to his students especially on their formative years, thus they must adhere to exacting standards of morality and decency and conduct themselves beyond reproach. Accordingly, teachers must abide by a standard of personal conduct which not only proscribes the commission of immoral acts, but also prohibits behavior creating a suspicion of immorality because of the harmful impression it might have on the students. Likewise, they must observe a high standard of integrity and honesty. From the foregoing, it seems obvious that when a teacher engages in extra-marital relationship, especially when the parties are both married, such behavior amounts to immorality, justifying his termination from employment. FACTS: Rolando Aparante, Sr. was first employed by private respondent Coca-Cola Bottlers Phils., Inc. (CCBPI), General Santos City Plant as assistant mechanic in April 1970. He rose through the ranks to eventually hold the position of advertising foreman until his termination on May 12, 1988 for alleged violation of company rules and regulations. His monthly salary at the time of his termination was P5,600. On November 9, 1987, Aparante drove CCBPI's advertising truck to install a panel sign. He sideswiped Marilyn Tejero, a ten-year old girl. He brought Tejero to Heramil Clinic for first aid treatment. As the girl suffered a 2 cm fracture on her skull which was attributed to the protruding bolt on the truck's door, she was subsequently transferred to the General Santos City Doctor's Hospital where she underwent surgical operation. She stayed in the hospital for about a month. Five days after the accident, he reported the incident to CCBPI. At about the same time, he submitted himself to the police authorities at Polomolok, South Cotabato for investigation where it was discovered that he had no driver's license at the time of the accident. In view thereof, FGU Insurance Corporation, an insurer of CCBPI's vehicles, did not reimburse the latter for the expenses it incurred in connection with Tejero's hospitalization a total amount of P19,534.45. CCBPI conducted an investigation of the incident where Aparente was given the opportunity to explain his side and to defend himself. On May 12, 1988, Aparente was dismissed for having violated the company rules and regulations particularly Sec. 12 of Rule 005-858 for blatant disregard of established control procedures resulting in company damages. wages. The NLRC affirmed but reversed its ruling upon motion of CCBPI. It declared the dismissal as one for just cause and effected after observance of due process. On the petitioner's contention that the school's faculty signed a letter of support for Mrs. Martin, the Court held that such letter of support did not absolve Mrs. Martin of any wrongdoing but was merely a protest of the imposed leave of absence, moreover, the expression of support was personal to Mrs. Martin, and the same should not redound to the benefit of the petitioner. Finally, petitioner cannot invoke in his favor the ruling in the Arlene Martin case, wherein the NLRC ruled that her dismissal was illegal. It must be noted that the reason for declaring Martins dismissal as illegal was the failure by the private respondent to accord her the required due process. Finding that petitioners dismissal was for a just and valid cause, the grant of financial assistance by the NLRC is without any factual and legal basis; wherefore, the NLRC decision is affirmed and the award of financial assistance deleted. __________________________________________________________________

22

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C ISSUES: 1. WON the NLRC erred in holding that CCBPI afforded petitioner due process 2. WON the NLRC erred in upholding the dismissal despite its initial finding that the CCBPI had implicitly tolerated petitioners driving without a license 3. WON the infraction committed by petitioner warrants the penalty of dismissal despite the fact that it was his first offense during his 18 long years of satisfactory and unblemished service HELD: 1. NO. The essence of due process does not necessarily mean or require a hearing but simply a reasonable opportunity or a right to be heard or as applied to administrative proceedings, an opportunity to explain one's side. In labor cases, the filing of position papers and supporting documents fulfill the requirements of due process. Aparente was fully aware that he was being investigated for his involvement in the vehicular accident that took place on November 9, 1987. It was also known to him that as a result of the accident, the victim suffered a 2 cm fracture on her skull which led to the latter's surgical operation and confinement in the hospital for which CCBPI incurred expenses amounting to P19,534.45 which FGU Insurance Corporation refused to reimburse upon finding that he was driving without a valid driver's license. Thus, being aware of all these circumstances and the imposable sanctions under CCBPI's Code of Disciplinary Rules and Regulations, he should have taken it upon himself to present evidence to lessen his culpability. 2. NO. According to Aparente, he informed the company that he had lost his license five months before the accident. Notwithstanding such fact, the company allowed him to continue driving the vehicle assigned to him. Thus, he shifts the blame to the company, claiming that it should have simply ordered him to desist from driving the vehicle once it was informed of the loss of his license. His contention is belied by his very own admission in his position papers filed before the Labor Arbiter and the NLRC that the company had in fact prohibited him from driving immediately after he lost his license, and had requested him to secure a new license. However, through misrepresentations, he led CCBPI to believe that he had procured another driver's license. Thus, he was permitted to drive again. 3. YES. The law warrants the dismissal of an employee without making any distinction between a first offender and a habitual delinquent where the totality of the evidence was sufficient to warrant his dismissal. In protecting the rights of the laborer, the law authorizes neither oppression nor self-destruction of the employer. Company policies and regulations, unless shown to be grossly oppressive or contrary to law, are generally valid and binding on the parties and must be complied with until finally revised or amended, unilaterally or preferably through negotiation, by competent authority. The Court has upheld a company's management prerogatives so long as they are exercised in good faith for the advancement of the employer's interest and not for the purpose of defeating or circumventing the rights of the employees under special laws or under valid agreements. First, Aparente's dismissal is justified by Company rules and regulations. It is true that his violation of company rules is his first offense. Nonetheless, the damage caused to private respondent amounted to more than P5,000, thus, the penalty of discharge is properly imposable as provided by CCBPI's Code of Disciplinary Rules and Regulations. Second, Article 282, in order that an employer may dismiss an employee on the ground of willful disobedience, there must be concurrence of at least two requisites: The employee's assailed conduct must have been willful or intentional, the willfulness being characterized by a wrongful and perverse attitude; and 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. We have found these requisites to be present in the case at bar. The evidence clearly reveals the willful act of Aparente in driving without a valid driver's license, a fact that he even tried to conceal during the investigation conducted by CCBPI. Such misconduct should not be rewarded with re-employment and back wages, for to do so would wreak havoc on the disciplinary rules that employees are required to observe. In the instant case, we find the award to petitioner of separation pay by way of financial assistance equivalent to month's pay for every year of service equitable. Although meriting termination of employment, petitioner's infraction is not as reprehensible or unscrupulous as to warrant complete disregard for the fact that this is his first offense in an employment that has spanned 18 long years. Disposition Decision of the NLRC is AFFIRMED. __________________________________________________________________ 29. EASTERN TELECOMMUNICATIONS PHILS INC V. DIAMSE, 491 SCRA 239 FACTS Maria Charina Damse is the Head of Building Services of ETPI. She requested a cash advance of P150k for the renewal of ETPIs business permits. The companys policy is cash advances should be liquidated 15 days from the completion of the projector activity, or else it will be deducted from the employees salary, benefits or receivables. She was able to use a total of P97,151.00 but was not able to liquidate the cash advance within 15 days. On July 13, 2001, ETPIs Finance Dept advised her to liquidate the amount. She submitted a liquidation report on August 13, 2001. This report was refused by the Fin Dept for being late. She was told that the entire amount would just be deducted from her monthly salary starting Sept 2001. By Dec 2001, a total of P23k had been deducted from her salary. She then requested for reimbursement for P97,151. This was reviewed by her supervisor and approved by HR and Fin Dept, and the amt was credited to her ATM payroll acct. ETPI required Diamse to explain why she should not be disciplined for unauthorized diversion or application of company funds, and for acts of dishonesty, fraud, deceit and willful breach of trust. She explained what that the liquidation report wasnt accepted by the Fin Dept and she was instead advised to do as she did. A month later, she was dismissed.

23

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C Labor Arbiter ruled in her favor. NLRC reversed. CA reversed NLRC and ordered separation pay etc instead of reinstatement because of the strained relations bet the parties. ISSUE WON Diamse was illegally dismissed HELD YES. To be a valid cause for dismissal, the loss of trust and confidence must be based on a willful breach and founded on clearly established facts. A breach is willful if it is done intentionally, knowingly and purposely, without justifiable excuse, as distinguished from an act done carelessly, thoughtlessly, heedlessly or inadvertently. Loss of trust and confidence must rest on substantial grounds and not on the employer's arbitrariness, whims, caprices or suspicion; otherwise, the employee would eternally remain at the mercy of the employer. The SC held that the mere delay in the liquidation of the cash advance cannot sustain a finding of loss of trust and confidence. It was based on mere suspicion, without evidence to show that Diamse misappropriated funds. In fact, all documents submitted were found to be authentic. The evidence on record shows that Diamse was able to liquidate the cash advance and that the ensuing delay in its liquidation was attributable to ETPI. Suspicion has never been a valid ground for dismissal and the employee's fate cannot, in justice, be hinged upon conjectures and surmises. Further, The Company suspected that the money in her account came from the P97k erroneously credited to her acct. They didnt bother to prove it and werent able to show any bank statements to that effect. Final Disposition: Petition denied. CA decision affirmed and modified in that this case be REMANDED to the Labor Arbiter for the sole purpose of computing Diamse's full backwages, etc __________________________________________________________________ 30. GLOBE-MACKAY CABLE AND RADIO CORP V. NLRC, 206 SCRA 702 Facts: In May 1982, private respondent was employed by Globe-Mackay Cable and Radio Corporation (GMCR) as general systems analyst. Also employed by petitioner as manager for technical operations' support was Delfin Saldivar with whom private respondent was allegedly very close. Sometime in 1984, petitioner GMCR, prompted by reports that company equipment and spare parts worth thousands of dollars under the custody of Saldivar were missing, caused the investigation of the latter's activities. The report dated September 25, 1984 prepared by the company's internal auditor, Mr. Agustin Maramara, indicated that Saldivar had entered into a partnership styled Concave Commercial and Industrial Company with Richard A. Yambao, owner and manager of Elecon Engineering Services (Elecon), a supplier of petitioner often recommended by Saldivar. The report also disclosed that Saldivar had taken petitioner's missing Fedders airconditioning unit for his own personal use without authorization and also connived with Yambao to defraud petitioner of its property. The airconditioner was recovered only after petitioner GMCR filed an action for replevin against Saldivar. 1 It likewise appeared in the course of Maramara's investigation that Imelda Salazar violated company reglations by involving herself in transactions conflicting with the company's interests. Evidence showed that she signed as a witness to the articles of partnership between Yambao and Saldivar. It also appeared that she had full knowledge of the loss and whereabouts of the Fedders airconditioner but failed to inform her employer. Consequently, in a letter dated October 8, 1984, petitioner company placed private respondent Salazar under preventive suspension for one (1) month, effective October 9, 1984, thus giving her thirty (30) days within which to, explain her side. But instead of submitting an explanations three (3) days later or on October 12, 1984 private respondent filed a complaint against petitioner for illegal suspension, which she subsequently amended to include illegal dismissal, vacation and sick leave benefits, 13th month pay and damages, after petitioner notified her in writing that effective November 8, 1984, she was considered dismissed "in view of (her) inability to refute and disprove these findings. 2 After due hearing, the Labor Arbiter in a decision dated July 16, 1985, ordered petitioner company to reinstate private respondent to her former or equivalent position and to pay her full backwages and other benefits she would have received were it not for the illegal dismissal. Petitioner was also ordered to pay private respondent moral damages of P50,000.00. On appeal, public respondent National Labor Relations, Commission in the questioned resolution dated December 29, 1987 affirmed the aforesaid decision with respect to the reinstatement of private respondent but limited the backwages to a period of two (2) years and deleted the award for moral damages. Issue:Is Ruling: Yes, the the suspension suspension is and legal but the the dismissal dismissal is legal? illegal.

The inestigative findings of Mr. Maramara, which pointed to Delfin Saldivar's acts in conflict with his position as technical operations manager, necessitated immediate and decisive action on any employee closely, associated with Saldivar. The suspension of Salazar was further impelled by th.e discovery of the missing Fedders airconditioning unit inside the apartment private respondent shared with Saldivar. Under such circumstances, preventive suspension was the proper remedial recourse available to the company pending Salazar's investigation. By itself, preventive suspension does, not signify that the company has adjudged the employee guilty of the charges she was asked to answer and explain. Such disciplinary measure is resorted to for the protection of the company's property pending investigation any alleged malfeasance or misfeasance committed by the employee.

24

LABOR STANDARDS | CASE DIGESTS | FEB 24, 2012 CLASS 2C Thus, it is not correct to conclude that petitioner GMCR had violated Salazar's right to due process when she was promptly suspended. If at all, the fault, lay with private respondent when she ignored petitioner's memorandum of October 8, 1984 "giving her ample opportunity to present (her) side to the Management." Instead, she went directly to the Labor Department and filed her complaint for illegal suspension without giving her employer a chance to evaluate her side of the controversy. Art. 279 of the Labor Code, as amended, provides: However, on close scrutiny, we agree with public respondent that such a circumstance did not create a conflict of interests situation. As a systems analyst, Salazar was very far removed from operations involving the procurement of supplies. Salazar's duties revolved around the development of systems and analysis of designs on a continuing basis. In other words, Salazar did not occupy a position of trust relative to the approval and purchase of supplies and company assets. In the instant case, petitioner has predicated its dismissal of Salazar on loss of confidence. As we have held countless times, while loss of confidence or breach of trust is a valid ground for terminations it must rest an some basis which must be convincingly established. An employee who not be dismissed on mere presumptions and suppositions. Petitioner's allegation that since Salazar and Saldivar lived together in the same apartment, it "presumed reasonably that complainant's sympathy would be with Saldivar" and its averment that Saldivar's investigation although unverified, was probably true, do not pass this Court's test. While we should not condone the acts of disloyalty of an employee, neither should we dismiss him on the basis of suspicion derived from speculative inferences. To rely on the Maramara report as a basis for Salazar's dismissal would be most inequitous because the bulk of the findings centered principally oh her friend's alleged thievery and anomalous transactions as technical operations' support manager. Said report merely insinuated that in view of Salazar's special relationship with Saldivar, Salazar might have had direct knowledge of Saldivar's questionable activities. Direct evidence implicating private respondent is wanting from the records. It is also worth emphasizing that the Maramara report came out after Saldivar had already resigned from GMCR on May 31, 1984. Since Saldivar did not have the opportunity to refute management's findings, the report remained obviously one-sided. Since the main evidence obtained by petitioner dealt principally on the alleged culpability of Saldivar, without his having had a chance to voice his side in view of his prior resignation, stringent examination should have been carried out to ascertain whether or not there existed independent legal grounds to hold Salatar answerable as well and, thereby, justify her dismissal. Finding none, from the records, we find her to have been unlawfully dismissed. On the other hand, has she betrayed any confidence reposed in her by engaging in transactions that may have created conflict of interest situations? Petitioner GMCR points out that as a matter of company policy, it prohibits its employees from involving themselves with any company that has business dealings with GMCR. Consequently, when private respondent Salazar signed as a witness to the partnership papers of Concave (a supplier of Ultra which in turn is also a supplier of GMCR), she was deemed to have placed. herself in an untenable position as far as petitioner was concerned.

Sec. 2. Security of Tenure. In cases of regular employments, the employer shall not terminate the services of an employee except for a just cause as provided in the Labor Code or when authorized by existing laws. Sec. 3. Reinstatement. An employee who is unjustly dismissed from work shall by entitled to reinstatement without loss of seniority rights and to backwages." 7 (Emphasis supplied) There being no evidence to show an authorized, much less a legal, cause for the dismissal of private respondent, she had every right, not only to be entitled to reinstatement, but ay well, to full backwages." The intendment of the law in prescribing the twin remedies of reinstatement and payment of backwages is, in the former, to restore the dismissed employee to her status before she lost her job, for the dictionary meaning of the word "reinstate" is "to restore to a state, conditione positions etc. from which one had been removed" and in the latter, to give her back the income lost during the period of unemployment. Both remedies, looking to the past, would perforce make her "whole." In the case at bar, the law is on the side of private respondent. In the first place the wording of the Labor Code is clear and unambiguous: "An employee who is unjustly dismissed from work shall be entitled to reinstatement. . . . and to his full backwages. . . ." Under the principlesof statutory construction, if a statute is clears plain and free from ambiguity, it must be given its literal meaning and applied without attempted interpretation. Obviously, the principle of "strained relations" cannot be applied indiscriminately. Otherwise reinstatement can never be possible simply because some hostility is invariably engendered between the parties as a result of litigation. That is human nature. Besides, no strained relations should arise from a valid and legal act of asserting one's right; otherwise an employee who shall assert his right could be easily separated from the service, by merely paying his separation pay on the pretext that his relationship with his employer had already become strained. Here, it has not been proved that the position of private respondent as systems analyst is one that may be characterized as a position of trust and confidence such that if reinstated, it may well lead to strained relations between employer

25