Erven John P Claros Case Digests Oct.

30 2020

1.Al-Masiya Overseas v. Viernes, G.R. No. 216132 | 2020-01-22

Facts: Viernes was deployed in Kuwait by Al-Masiya, through Saad Mutlaq Al Asmi Domestic Staff
Recruitment Office (Saad Mutlaq)/Al Dakhan Manpower, to work as a domestic helper.
Respondent's stipulated pay was US$400 per month for a period of two years.

After several unsuccessful attempts to find an employer, she returned to the Philippines.

She was made to sign a quitclaim and a resignation letter.

She then filed an illegal dismissal case against Al-Masiya.

Issue: WON Viernes was illegally dismissed

Held: Yes. In a similar vein, the circumstances of the present case strongly indicate that
respondent was constructively dismissed.

First, Saad Mutlaq, respondent's foreign employer, never secured a working visa for her, in
violation of the categorical requirement for an employer's accreditation with the Philippine
Overseas Employment Agency.

Second, respondent was not properly paid in accordance with the terms of her employment
contract. During her three-month stay, she was only paid US$227.75 instead of the stipulated pay
of US$400 per month.

Third, respondent was not assigned to a permanent employer abroad for the entire contractual
period of two years. Upon her arrival in Kuwait, she was consistently promised job placements
which were found to be inexistent. As noted by the NLRC, it was clear that Saad Mutlaq intended
to use respondent as an entertainer of some sort in places of ill repute; and she would have fallen
victim to human trafficking "[w]ere it not for some favorable providence."

Finally, similar to the case of Torreda, herein respondent was made to copy and sign a prepared
resignation letter and this was made as a condition for the release of her passport and plane
ticket.

In light of these, the Court finds that, indeed, it was logical for respondent to consider herself
constructively dismissed. The impossibility, unreasonableness, or unlikelihood of continued
employment has left respondent with no other viable recourse but to terminate her employment.

2.Nippon Express v. Daguiso, G.R. No. 217970

Facts: On September 26, 2005, NEPC hired respondent Daguiso as Corporate Human Resource
Specialist. She was later promoted to the position of Corporate Human Resource Supervisor with
a monthly salary of P30,384.90 and an allowance of P3,000.00 per month.
On June 1, 2012, at about 8:22 a.m., Human Resource Specialist Diane Aguirre, who was a
subordinate of Daguiso, sent the department heads an electronic mail (e-mail), informing them
that "all attendance monitoring and other DTR concern shall be directed to Ms. Honeylet Suaiso x
x x effective June 01, 2012." Daguiso asked Aguirre why she sent the said e-mail implementing
the new assignment of Suaiso without furnishing her and Suaiso a copy thereof. Aguirre replied
that Senior Manager Yolanda G. De Vera ordered her to send the e-mail. Daguiso allegedly lost
her temper and shouted at Aguirre, and it led to a shouting match between the two.

The commotion stopped when NEPC's General Manager Yoshitomo Omori went out of his office
and intervened.

Daguiso was then terminated. On June 4, 2012, Daguiso filed a complaint for illegal dismissal
against NEPC and its officers: President Yoshinori Kikuchi, General Manager Yoshitomo Omori
and Senior Manager Yolanda G. De Vera.

Daguiso appealed the decision of the Labor Arbiter and NLRC to the CA, contending that the Labor
Arbiter gravely abused his discretion in (1) not ordering her reinstatement; (2) not holding De Vera
solidarity liable with NEPC for her illegal dismissal despite the fact that she was the one who
directly committed the acts of illegal dismissal; and (3) not awarding her moral and exemplary
damages

CA reversed NLRC.

Issue: WON Daguiso must be reinstated

Held: Yes. The NLRC gravely abused its discretion in ruling against the reinstatement of Daguiso
due to strained relations on these bases: (1) Daguiso's resentment toward Senior Manager De
Vera was apparent when she insisted in her appeal that De Vera be held personally liable for her
illegal dismissal; and (2) Daguiso did not deny that she was involved in a shouting match with her
subordinate, Aguirre, which shows that Daguiso's continuance in her employment could not foster
a harmonious workplace.

We have held that the filing of a complaint does not necessarily translate to strained relations
between the parties. Such filing of a complaint includes the prayer of the complainant, and in this
case, the prayer of Daguiso that De Vera be held solidarily liable, which is for the labor tribunals
and the courts to resolve. As a rule, no strained relations should arise from a valid and legal act
asserting one's right. Although litigation may engender a certain degree of hostility, the
understandable strain in the parties' relation would not necessarily rule out reinstatement which
would, otherwise, become the rule, rather the exception, in illegal dismissal cases

The doctrine of strained relations should not be applied indiscriminately to cause the non-
reinstatement of a supervisory employee who is dismissed without just cause and without due
process by the employer due to an altercation caused by its senior officer who bypassed the
dismissed employee. An employee's occupation is his/her means of livelihood, which is a precious
economic right; hence, it should not just be taken away from the employee by applying the
exception of "strained relations" that is not justified. The State guarantees security of tenure to
workers; thus, all efforts must be exerted to protect a worker from unjust deprivation of his/her
job.
3.University of St. La Salle v. Glaraga,G.R. No. 224170 | 2020-06-10

Facts: Petitioner University of St. La Salle (petitioner) engaged respondents Josephine L. Glaraga,
Maricar C. Manaay, Leo G. Lozana, Queenie M. Jarder, Erwin S. Pondevida, Arlene T. Conlu, Jo-
Ann P. Saldajeno, Tristan Julian J. Teruel, Jean C. Argel and Sheila A. Cordero (respondents), as
probationary full-time faculty, each with a teaching load 24 to 25 units. Beginning in the first
semester of 2010-2011, respondents were engaged as probationary part-time faculty members
each with a teaching load of 5 units. 7 The letter notifying respondents of the reduction in load
and schedule merely cites decline in enrolment as the underlying reason. 8 Moreover, in its
petition, petitioner states that this arrangement was only "until things would get better for the
nursing course."

From the first semester of 2008-2009 through the second semester of 2010-2011, respondents'
engagements were covered by Documents of Agreement covering five-month periods at a time
and containing the following standard clause:

This contract covers only the specific period stated and will not require any other written notice
of expiry. Renewal of probationary fulltime faculty will be based on both the annual minimum
performance evaluation score of 85 and a positive evaluation of behavioral conduct, interpersonal
relationships, commitment and loyalty to the institution and other moral and ethical
considerations.

In addition to the above, as a condition for continued employment, one should manifest
seriousness of purpose by binding himself/herself to the mission, policies, procedures and
behavioral expectations of the University as contained in (but not limited to) the Administrative
and Faculty Manual. To be eligible for permanency, one must have earned his/her masteral degree
within the 3-year probationary period.

In the summer and first semester of 2011, respondents were not offered any teaching load, and
they were not issued any new documents of agreement. 11 Thus, they filed a complaint for illegal
dismissal, salary differential due to diminution of benefits, damages and attorneys' fees, which
the LA granted.

NLRC reversed. CA reversed NLRC.

Issue: WON the respondents were illegal dismissed

Held: No. Citing the ruling in Mercado v. AMA Computer College, the CA sustained the finding of
the LA that respondents' probationary period was for three years, notwithstanding that their
contracts were for fixed short periods of five months.

During their probationary period, respondents were entitled to security of tenure in that they may
be validly dismissed only for just or authorized causes; expiration of their fixed short term
contracts was not just or authorized cause.

Based on the petitioner's allegations and evidence, however, the CA ruled that the respondents
were lawfully dismissed due to redundancy. Redundancy being the cause of termination, payment
of separation benefits was validly ordered by the Labor Arbiter.

The CA noted that while petitioner may have validly terminated respondents' employment due to
redundancy, petitioner failed to comply with the procedural requirement of prior notice under the
Labor Code. Accordingly, the CA added nominal damages to the monetary award granted by the
LA.

4.Herma Shipping v. Cordero, G.R. No. 244210, January 27, 2020

Facts: Cordero was employed on March 31, 1992 as Able Seaman by HSTC, a corporation engaged
in the business of hauling, shipping and/or transporting oil and petroleum products in Philippine
waters, on board one of its vessels. During his employment, Cordero was part of the complement
of M/Tkr Angat, where one of his primary duties entailed being a Helmsman or a duty look-out
during vessel navigation.

Sometime in 2015, HSTC discovered significant losses of the oil and petroleum products
transported by M/Tkr Angat during its past twelve (12) voyages. Consequently, HSTC conducted
an investigation and sent a Notice to Explain/Show Cause Memo on January 28, 2016 to five (5)
crew members, including Cordero, requiring them to submit a written explanation for allegedly
committing: (a) violation of HSTC's Code of Discipline; (b) Serious Misconduct; and (c) Willful
Breach of Trust and Confidence. Pending the investigation, the five (5) crew members were placed
on preventive suspension.

In his defense, Cordero denied the allegations against him and claimed that he did not see
anything unusual or suspicious during the voyages, and that if there were any such case, he did
not see them due to his poor eyesight. After HSTC found Cordero's explanation insufficient, he
was dismissed from employment through a Notice of Termination dated March 8, 2016.

This prompted Cordero to file a complaint for illegal dismissal and payment of 13th month pay,
separation pay, damages, and attorney's fees against HSTC and Esguerra, as its Chief Executive
Officer, before the NLRC.

LA dismissed. NLRC and CA affirmed.

Issue: WON dismissal is valid

Held: Yes. It would appear that the offense for which Cordero was validly dismissed in 2016 was
not his first offense, thereby negating the CA's finding that he had no previous derogatory record.

The fact that Cordero had been given Notices to Explain in 2003 and another in 2013 for entirely
different offenses only proves that he had committed infractions against HSTC even prior to the
present incident of oil pilferage. Moreover, while it is true that Cordero remained in the employ of
HSTC until his dismissal in 2016, HSTC's right as an employer to call out, investigate, and
eventually, dismiss him for just cause must still be recognized.

On this score, it must be pointed out that the last offense that Cordero committed against HSTC
constitutes Serious Misconduct, which resulted in the latter's loss of trust and confidence in him.
Hence, the penalty of dismissal cannot be considered as "too harsh" under the circumstances.

Having established that Cordero's employment was terminated for just cause and that he was
therefore validly dismissed, as well as the fact that the infractions he committed against HSTC
involve moral turpitude and constitute Serious Misconduct, the award of separation pay in his
favor is devoid of basis in fact and in law. Accordingly, the same must be deleted.
5.San Miguel Corporation v. Gomez, G.R. No. 200815, August 26, 2020

Fats: SMC employed Gomez on September 16, 1986 as a researcher in the Security Department
and concurrently as Executive Secretary to the Head of the Security Department. Sometime in
October 1994, Gomez was assigned as coordinator in the Mailing Department of SMC. On
December 20, 2002, SMC terminated her services on the ground of fraud or willful breach of trust.

The circumstances which led to the termination of Gomez's employment involved SMC's
arrangement with C2K Express, Inc. (C2K).

C2K is a corporation engaged in courier and delivery services, which entered into business with
SMC sometime in January 2001 as the latter's courier. For the first three months, the relationship
between C2K and SMC went smoothly until C2K encountered difficulty in collecting its service fee
from SMC. Eventually, it was found out that C2K's former manager, Daniel Tamayo (Tamayo),
formed another courier services group, Starnec, which had been using fake C2K receipts and
collecting the fees pertaining to C2K. C2K claimed that it was through Gomez's intervention that
Tamayo's group was able to transact business with SMC.

C2K brought the matter to the attention of SMC, which conducted an investigation. In line with
this, SMC requested C2K's President, Edwin Figuracion (Figuracion), to execute an affidavit
narrating their claim. In the said affidavit, Figuracion mentioned that Gomez had been collecting
25% commission from the total payment received by C2K. An audit was conducted where it was
discovered that Gomez was allegedly involved in anomalies which caused tremendous losses to
SMC.

SMC conducted an administrative investigation and hearing where Gomez was able to present her
evidence and witnesses to disprove the charges against her.

After the investigation, Gomez was found guilty of committing fraud against SMC and of receiving
bribes through commissions in connection with the performance of her function.

On December 20, 2002, SMC issued a Notice of Termination of Services to Gomez prompting her
to file a case for illegal dismissal with the National Labor Relations Commission (NLRC).

NLRC and CA ruled for Gomez.

Issue: WON there is a valid dismissal

Held: Yes. At the outset, We note that Gomez was accorded with procedural due process since
she was given both notice and hearing where she was able to present her evidence and witnesses
to disprove the charges against her.

On the substantive aspect, this Court finds Gomez liable for fraud or willful breach of trust, a valid
ground for the termination of her employment.

Article 297 [282] (c) of the Labor Code provides that an employer may terminate the services of
its employee for "[f]raud or willful breach x x x of the trust reposed in him by his employer or duly
authorized representative." As a rule, employers have the discretion to manage its own affairs,
which includes the imposition of disciplinary measures on its employees.
Thus, "employers are generally given wide latitude in terminating the services of employees who
perform functions which by their nature require the employer's full trust and confidence."

The requisites for dismissal on the ground of loss of trust and confidence are:

"(1) the employee concerned must be holding a position of trust and confidence;

(2) there must be an act that would justify the loss of trust and confidence;

[and (3)] such loss of trust relates to the employee's performance of duties."

In view of the first requisite above, this Court must make a determination with regard to the true
nature of Gomez's position. SMC claims that Gomez is a mailing coordinator at the Mailing
Department tasked with weighing and determining the volume of documents and other shipments
of the corporation, 36 including the Kaunlaran Magazines.

The Mailing Department is headed by a manager, in this case Ms. Rosanna Mallari (Gomez's boss),
who takes care of the voluminous mailing as well as courier services of SMC.

The Court finds that Gomez indeed occupied a position of trust and confidence, as defined by law
and jurisprudence, since she was entrusted with SMC's property, in particular its mail matter
which included weighing and determining volumes of documents to be shipped. Thus, she was
routinely charged with custody of SMC's mail matter.

In addition, We find that SMC likewise substantially proved the second requisite (i.e., there must
be an act that would justify the loss of trust and confidence). In Cadavas v. Cour t of Appeals,

We have emphasized that "[l]oss of trust and confidence to be a valid cause for dismissal must
be based on a willful breach of trust and founded on clearly established facts. Such 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."

In this case, We find that Gomez willfully, intentionally, knowingly, purposely, and without
justifiable excuse disregarded SMC's rules and regulations in the workplace.

6.Lufthansa Technik v. Cuizon, G.R. No. 184452 | 2020-02-12

Facts: Petitioners claim that they validly terminated Cuizon's employment on August 16, 2005 for
loss of trust and confidence in his ability to perform his duties as MA2 Duty Manager. They point
out that such loss of trust and confidence resulted from Cuizon's numerous violations and blatant
disregard of the LTP Standards in the Workplace, which violations were committed in the course
of two separate incidents, specifically:

1. [Cuizon's] willful concealment of the accidental light-up of PAL Aircraft EI-BZE [on] 10 March
2005, [accidental light-up incident] and
2. [Cuizon's] failure to observe the safety guidelines and precautions of petitioner LTP with respect
to aircraft towing, which caused damage to PAL Aircraft RP-C4008 [on] 15 April 2005 [towing
incident].

In his defense, Cuizon asserts that petitioners have no basis in terminating him; hence, the
termination was illegal. Cuizon avers that he was being singled-out due to events prior to the
accidental light-up and towing incidents. He explains that prior to the foregoing incidents, an
anonymous letter was circulated, which was addressed to LTP's President and CEO, Andreas
Heizner, and to some of the LTP's officers. The letter was allegedly criticizing Loquellano's
handling of the company in Cebu and his other alleged culpabilities, which are inimical to LTP's
interest. In the same letter, Cuizon was being praised for his work ethic and named as the better
person to hold the position of MA-2 Manager than Loquellano. Loquellano suspected Cuizon as
the sender of the anonymous letter. As a result, Cuizon received a cold treatment from his direct
superior, Loquellano

LA and NRC ruled against Cuizon. CA reversed.

Issue: WON there is illegal dismissal

Hels: Yes. Article 297 (formerly 282) of the Labor Code provides that an employer may terminate
its employee for "[f]raud or willful breach by the employee of the trust reposed in him by his
employer or duly authorized representative."

"The requisites for dismissal on the ground of loss of trust and confidence are:

(1) the employee concerned must be holding a position of trust and confidence;

(2) there must be an act that would justify the loss of trust and confidence;

[and (3)] such loss of trust relates to the employee's performance of duties."

In the instant case, We find that petitioners failed to substantially prove the second requisite (i.e.,
there must be an act that would justify the loss of trust and confidence). In Cadavas, We have
emphasized that "[l]oss of trust and confidence to be a valid cause for dismissal must be based
on a willful breach of trust and founded on clearly established facts. Such 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,"

However, in this case, We are of the firm view that petitioners failed to prove that Cuizon will fully,
intentionally, knowingly, purposely, and without justifiable excuse disregarded LTP's rules and
regulations in the workplace. On the contrary, this Court finds that Cuizon has substantially
refuted petitioners' claim on the alleged concealment of the accidental light-up and the towing
incident.

7.Pascual v. Sitel Philippines, G.R. No. 240484 | 2020-03-09

Facts: On October 27, 2006, Sitel hired Pascual as agent. In 2014, Sitel promoted him to the
Comcast Customer Service Group (Comcast CSG) account as coach/supervisor with a monthly
salary of P25,000.00.
Subsequently, Sitel served a notice to explain 6 dated October 9, 2014 upon him for his failure to
take the necessary action on the case of Diosdado Jayson Remion (Remion), an agent in Comcast
CSG who has been inactive since May 2014. Sitel then served a second notice to explain upon him
charging him with:

(a) gross and habitual neglect of duties; (b) other analogous causes; and (c) acts of gross
negligence or intentional acts of damage resulting in personal injury or damage to property of the
company or third persons, or otherwise causing expenses to be incurred by the company.

In his Reply, petitioner requested that the charges against him be "particularized" to enable him
to raise proper defenses.

On November 11, 2014, an administrative hearing was held wherein petitioner failed to attend. In
a Notice to Decision served on November 21, 2014, Sitel suspended petitioner from November 26
to 30, 2014. Instead of terminating petitioner for his infraction, the company took note that he only
inherited the Remion case from his predecessors. On December 18, 2014, however, petitioner
tendered his resignation letter which the management accepted the following day.

With regard to petitioner's claim of illegal suspension, respondents insisted that it was for a just
and valid cause, that is, petitioner's negligence or failure to report and act upon an unproductive
agent under his supervision. Besides, he voluntarily resigned from his work contrary to his
assertion of constructive dismissal.

LA, NLRC and CA in favor of Sitel.

Issue: WON there is illegal dismissal

Held: No. Petitioner's resignation was voluntary and Sitel is not guilty of constructive dismissal.

Here, contrary to petitioner's assertions, Sitel aptly established that petitioner's e -mails and
resignation letter showed the voluntariness of his separation from the company. While the fact of
filing a resignation letter alone does not shift the burden of proof, it is still incumbent upon the
employer to prove that the employee voluntarily resigned. In petitioner's case, the facts show that
the resignation letter is grounded in petitioner's desire to leave the company as opposed to any
deceitful machination or coercion on the part of Sitel. His subsequent and contemporaneous
actions belie the claim that petitioner was subjected to harassment by Sitel. Interestingly, e ven
when given the opportunity to explain his side regarding the Remion's case, petitioner
conspicuously failed to do so. He consistently evaded the issue and did not attend the hearing on
the matter.

Petitioner could not have been coerced as well. Coercion exists when there is a reasonable or
well-grounded fear of an imminent evil upon a person or his property or upon the person or
property of his spouse, descendants or ascendants. Neither petitioner's narration of facts prove
that he was intimidated.

In the end, aside from petitioner's self-serving declarations, the Court cannot countenance his
claims especially considering the legal dictum that he who asserts, not he who denies, must prove.
In the absence of such, the Court must rely on the actual proof presented as evidence, that is, the
resignation letter and e-mails of petitioner showing his intent to sever employment with Sitel, and
not the mere allegations of harassment that have characterized petitioner's grievances.
8.East Cam Tech v. Fernandez, G.R. No. 222289 | 2020-06-08

Facts: Petitioner East Cam Tech Corporation (East Cam) is a company engaged in the
manufacture of bags. It hired respondents Fernandez, Delos Santos, Trinidad, and Manalansan as
sewers in May 2002. Respondents previously filed an illegal dismissal complaint again st East
Cam, which resulted in their reinstatement. Upon returning to East Cam, they were reassigned to
the sewing line of the sample department. They noticed that the machines assigned to them were
old and worn out.

They were stationed at a place far from the sample room where all the special machines were
located. They felt singled out in terms of work because they were the only ones required to meet
a production quota and to submit hourly reports.

On January 12, 2010, East Cam charged them of negligence of duty for failure to comply with the
production quota. Their supervisor told them that there was no need to answer the charge and
that he would solve the problem. On February 27, 2010, they were dismissed from the service for
failure to answer the charge. This prompted the filing of a new complaint against East Cam, its
president. In Soo Jung, plant manager Sang Yong Kim, and Human Resources Department head
Corazon Bustamante for illegal dismissal with prayer for reinstatement, backwages, other money
claims, damages, and attorney's fees.

East Cam further asserted that in their Management and Employee Handbook, failure of an
employee to meet the prescribed quantity and quality standards is considered as negligence of
duty punishable by a written warning for the first offense, and dismissal from the service for the
second offense.

Respondents filed for illegal dismissal which was granted by LA and NLRC. CA reversed.

Issue: WON the dismissal is valid

Held: No. East Cam, as the employer, has the right to impose production quotas in its production
line based on its TMS for job orders one and two. However, East Cam failed to prove that it acted
in good faith when it did not adduce any evidence that its TMS were attainable based on the
quantity it wanted to produce for a given time, quality of the product to be produced, the machines
they have, and the skill sets of their employees. Further, East Cam failed to rebut the respondents'
allegations that:

(1) the machines assigned to them were old and worn out,

(2) they were stationed at a place far from the sample room where all the special machines are
located, and

(3) they were the only ones required to meet a production quota and to submit hourly reports.

The Court only upholds management prerogative as long as it is exercised in good faith for the
advancement of the employer's interest and not for the purpose of defeating or circumventing the
employees' rights under special laws and valid agreements.

9.Mejila v. Wrigley Philippines, G.R. No. 199505, September 11, 2019

Facts: WPI is a corporation engaged in the manufacturing and marketing of chewing gum. It
engaged the services of Mejila, a registered nurse, as an occupational health practitioner for its
Antipolo manufacturing facility sometime in April 2002. Her employment status was initially on a
contractual basis until she was regularized effective January 1, 2007.

On October 26, 2007, WPI sent a memorandum to Mejila informing her that her position has been
abolished as a result of the company's manpower rationalization program and that her
employment will be terminated effective November 26, 2007. The memorandum stated that Mejila
is no longer required to work beginning the same day, October 26, although her salary will be paid
until November 26.

In the meantime, WPI engaged the services of Activeone Health, Inc. to take over the services
previously handled by the occupational health practitioners starting November 1, 2007. The
abolition of WPI's in-house clinic services and decision to hire an independent contractor for clinic
operations was part of the management's Headcount Optimization Program designed to improve
cost efficiency, considering that clinic management is not an integral part of WPI's business.

Mejila filed a complaint for illegal dismissal against WPI.

LA ruled in Mejila’s favor. NLRC reversed. CA affirmed NLRC

Issue: WON there is illegal dismissal

Held: No. In the present case, We agree with the CA and the NLRC that WPI substantially proved
that its Headcount Optimization Program was a fair exercise of business judgment. The decision
to outsource clinic operations can hardly be considered as whimsical or arbitrary. As both the CA
and the NLRC found, WPI had deliberated on the feasibility of the Headcount Optimization
Program as early as February 2007 for the purpose of streamlining the organization and
increasing productivity.

On the other hand, Mejila failed to prove her accusation that WPI acted with ill motive in
implementing the redundancy program. The pieces of evidence presented by Mejila to support her
allegation were mainly hearsay and speculative at best. On the contrary, WPI's prior actions
showed that it was implementing its Headcount Optimization Program without singling out Mejila.
Prior to her termination, WPI had released at least 10 other employees as part of the program. It
must be emphasized that while the company bears the burden of proving that the dismissal of
employees on the ground of redundancy is justified, the onus of establishing that the company
acted in bad faith lies with the employee making such allegation.

10.Stanfilco v. Tequillo, G.R. No. 209735 | 2019-07-17

Facts:, Tequillo was a Farm Associate who worked on Stanfilco’s plantation from January 5, 2004
until he was terminated on May 24, 2010 for mauling his co-worker, Resel Gayon (Gayon), and
consuming intoxicating beverages within company premises and during work hours.

Every week, petitioner hosts a company-initiated employee gathering known as the "Kaibigan
Fellowship." While the assembly touches on matters that are not work-related, petitioner also
uses it as a venue for company announcements and production updates.
On September 12, 2009, petitioner held one such "Kaibigan Fellowship," and required all its
employees to be present thereat. However, Tequillo, instead of attending the gathering, opted to
go on a drinking spree at the farm shed area of petitioner's premises with several of his fellow
workers. Tequillo mauled Gayon.

On September 15, 2009, petitioner served Tequillo with a memorandum, requiring him to explain
why no disciplinary action should be taken against him for the drinking and mauling incident. In
response to the charge, Tequillo admitted to mauling Gayon, but averred that the act was done in
self-defense. However, anent the accusation of drinking, the former remained silent.

Administrative hearings were held on October 17, 2009 and February 2, 2010, during which
Tequillo was given the chance to explain his side. However, petitioner found his explanations
unsatisfactory, and eventually terminated him on May 24, 2010 on the ground of serious
misconduct.

Consequently, on October 6, 2010, Tequillo filed before the Labor Arbiter (LA) a complaint for
illegal dismissal.

LA dismissed the case. NLRC reversed,

Issue: WON dismissal is valid

Held: Yes. Under the law, an employee's termination may be justified on the ground of serious
misconduct. Misconduct is generally defined 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." In labor cases, misconduct, as a ground for
dismissal, must be serious — that is, it must be of such grave and aggravated character and not
merely trivial or unimportant. In addition, the act constituting misconduct must be connected with
the duties of the employee and performed with wrongful intent.

Hence, for an employee's termination to be justified on the ground of serious misconduct, the
following requisites must concur:

(a) the misconduct must be serious;

(b) it must relate to the performance of the employee's duties, showing that the employee has
become unfit to continue working for the employer; and

(c) it must have been performed with wrongful intent.

In this case, the CA refused to characterize Tequillo's acts as work-related because he was not a
participant in the "Kaibigan Fellowship." As may be recalled, Tequillo absented himself from the
gathering to go on a drinking spree with several other farm workers.

11.Santo v. University of Cebu, G.R. No. 232522 | 2019-08-28

Facts: In May 1997, respondent University of Cebu hired petitioner Carissa E. Santo as a full-time
instructor. During her employment, as such, she studied law and passed the 2009 Bar
Examinations. She continued working for respondent until she got qualified for optional retirement
under respondent's Faculty Manual. Optional Retirement

A permanent employee may, upon reaching his fifty-fifth (55th) birthday or after
having completed at least fifteen (15) years of service, opt for an early retirement
(which is a resignation with separation pay) considering that separation before
reaching 15 years of full-time service does not entitle an employee to any separation
pay, except that which is contributed by the University to PAG-IBIG), and shall be
entitled to the retirement pay equivalent to a total of fifteen (15) days for every year
of service based on the average monthly salary to the employee computed for the
past three years.

In April 2013, she applied for optional retirement; she was then only forty-two (42) years old but
had already completed sixteen (16) years of service with respondent. The latter approved her
application and computed her optional retirement pay at fifteen (15) days for every year of service
per provisions of the Faculty Manual. She asserted, though, that her retirement pay should be
equivalent to 22.5 days per year of service in accordance with Article 287 6 of the Labor Code.
Respondent refused to accept her computation. Thus, she initiated the complaint 7 below for
payment of retirement benefits under Article 287 8 of the Labor Code, damages and attorney's
fees against respondent.

For its part, respondent argued that petitioner was not covered by the Retirement Pay Law being
less than sixty (60) years old at the time of her retirement

LA ruled in favor of Santo. NLRC reversed.CA affirmed.

Issue: WON Santo is covered in early retirement

Held: Yes. The Faculty Manual intends to grant retirement benefits to qualified employees. It
entitles an employee to retire after fifteen (15) years of service or upon reaching the age of fifty -
five (55) and accordingly collect retirement benefits. It even mandates compliance with RA 7641
36 such that when the computation of its retirement plan is found to be lower than what the law
requires, respondent is bound to pay the deficiency.

Respondent's claim — that its optional retirement benefit is actually a form of separation pay to
qualified employees who wish to resign is belied by its own company policy. This benefit clearly
falls within the category of "Retirement Pay," specifically under "Optional Retirement."

The retirement benefits under Article 287 of the Labor Code, therefore, should be applied in the
computation of petitioner's retirement pay. It is more advantageous to petitioner and it is what
the law commands.

A retirement plan entitling an employee to retire after fifteen (15) years of service and accordingly
collect retirement benefits is "reward for services rendered since it enables an employee to reap
the fruits of her labor — particularly retirement benefits, whether lump-sum or otherwise, at an
earlier age, when said employee, in presumably better physical and mental condition, can enjoy
them better and longer."
12.Kho, Sr., v. Magbanua, G.R. No. 237246 | 2019-07-29

Facts: A complaint 7 for illegal dismissal was filed by Magbanua et. al before the LA against Holy
Face Cell Corporation , Tres Pares Fast Food (Tres Pares), and the Corporation's stockholders,
including its alleged President/Manager, Kho, and the latter's wife, Irene S. Kho

Magbanua posited that on January 14, 2011, Spouses Kho's daughter, Sheryl Kho, posted a notice
in the company premises that the restaurant would close down on January 19, 2011.

Fearing the loss of their jobs, they tried to seek an audience with Kho about the closure, but to no
avail. The restaurant closed as scheduled; thus respondents filed the complaint for illegal
dismissal with payment of separation pay, salary differentials, nominal damages, differentials on
overtime pay, service incentive leave pay, and holiday pay, including damages, as well as
attorney's fees.

For their part, Spouses Kho argued that they had no employer-employee relationship with
respondents, as the latter's employer was the Corporation, and that they cannot be held liable for
the acts of the Corporation, the same having been imbued with a personality separate and distinct
from its stockholders, directors, and officers.

LA ruled illegal dismissal. NLRC reversed. CA reversed NLRC.

Issue: WON there is illegal dismissal

Held: Yes. The fact that it was Kho's daughter who posted the closure notice and with whom
respondents requested for an audience with Kho to tackle the issue of closure — which notice was
not even presented in evidence — is no proof that he orchestrated the closure or assented to the
same, let alone in bad faith.

Relatedly, bad faith cannot be ascribed on any of the Corporation's officers by the mere fact that
the Corporation failed to comply with the notice requirement before closing down the restaurant.
Case law instructs that "[n]either does bad faith arise automatically just because a corporation
fails to comply with the notice requirement of labor laws on company closure or dismissal of
employees. The failure to give notice is not an unlawful act because the law does not define such
failure as unlawful. Such failure to give notice is a violation of procedural due process but does
not amount to an unlawful or criminal act.

Such procedural defect is called illegal dismissal because it fails to comply with mandatory
procedural requirements, but it is not illegal in the sense that it constitutes an unlawful or criminal
act."

Verily, absent any finding that Kho was a corporate officer of the Corporation who willfully and
knowingly assented to patently unlawful acts of the latter, or who is guilty of bad faith or gr oss
negligence in directing its affairs, or is guilty of conflict of interest resulting in damages thereto,
he cannot be held personally liable for the corporate liabilities arising from the instant case

13.Aparicio v. Manila Broadcasting, G.R. No. 220647 | 2019-12-10

Facts: Noli Aparicio and Renan Clarito were both assigned at the transmitter site of DYEZ (local
AM radio) and DZRH (a relaying station and a nationwide AM radio) in Barangay Taloc, Bago City;
Noel Solutan, at the studio transmitter of YES FM at Rizal-Locsin Streets, Bacolod City; and Delmer
Dilig and Abelardo Brillantes, at the studio of DYEZ and the transmitter site, Barangay Taloc.

Sometime in the last quarter of 2001, the Manila Broadcasting was directed to review the
operations of all MBC stations. The review revealed several losing stations were subsidized by
the more profitable Manila stations. As remedial measure, Chairman Fred Elizalde, through
Memorandum dated January 10, 2002, implemented the policy dubbed as "Hating Kapatid." Under
it, each station was considered independent of the Head Office and will no longer be subsidized.
As a result, each station had to review its own manpower complement.

Being one (1) of the losing MBC stations, FFES Bacolod, a relay station of DZRH, was shut down.
The employees assigned there, including Noli Aparicio and Renan Clarito were retrenched.

Except for Noel Solutan, who received the notice of retrenchment on March 1, 2002, petitioners, et
al., received theirs on February 28, 2002. On the same day, the company submitted its Revised
RRS Form and the Establishment Termination Report to the Department of Labor and Employment
(DOLE). It informed the DOLE that the retrenchment program was brought about by redundancy
and company reorganization and downsizing.

14.ABS-CBN Broadcasting v. Hilario, G.R. No. 193136, July 10, 2019

Facts: On March 6, 1995, respondent Honorato was hired by CCI as Designer.

CCI ceased operations.

In August 2003, Ty organized and created Dream Weaver Visual Exponents, Inc. (DWVEI). Like CCI,
DWVEI is primarily engaged in the business of conceptualizing, designing and constructing sets
and props for use in television programs and similar projects. With the incorporation of DWVEI,
petitioner engaged the services of DWVEI.

On September 4, 2003 8 and September 5, 2003, 9 respondents Banting and Hilario were served
their respective notices of the closure of CCI effective October 5, 2003.

On September 24, 2003, respondents filed a complaint for illegal dismissal, illegal deduction, non-
payment of meal allowances, with prayer for damages against CCI and petitioner before the
National Labor Relations Commission (NLRC) Arbitration Branch.

LA and NLRC ruled illegal dismissal. CA reversed.

Issue: WON there is illegal dismissal

Held: Yes. A closure or cessation of business or operations as ground for the termination of an
employee is considered invalid when there was no genuine closure of business but mere
simulations which make it appear that the employer intended to close its business or operations
when in truth, there was no such intention. To unmask the true intent of an employer when
effecting a closure of business, it is important to consider not only the measures adopted by the
employer prior to the purported closure but also the actions taken by the latter after the act.

Here, suspicions were raised when CCI decided to immediately cease its business operations
when one its officers. It becomes even more evident that the closure of CCI was done in bad faith
and with the intention of circumventing the laws when petitioner dropped CCI and instead hired
and engaged the services of Ty as consultant, and subsequently Ty's new company DWVEI for the
props and set design of its various programs, thereby resulting in the termination of respondents
and the other employees of CCI. Apparently, CCI's purported closure was a ploy to get rid of some
employees and there was actually a plan to continue with the business operations under the guise
of a new corporation, DWVEI, which merely transferred and rehired most of the employees of CCI,
to the prejudice of herein respondents who were terminated. Clearly, respondents' termination of
employment was illegal as it was done in bad faith and in circumvention of the law.

15.CMP Federal Security v. Reyes, Sr., G.R. No. 223082 | 2019-06-26

Facts: Sometime in August 2010, CMP Federal hired respondent Reyes as Security Guard and
assigned him at the Mariveles Grain Terminal (MG Terminal) in Mariveles, Bataan. He was twice
promoted, first as Shift-in-Charge, and then on September 15, 2015, as Detachment Commander.

According to Reyes, petitioners were not in favor of his promotion as Detachment Commander
because they wanted a certain Robert Sagun (Sagun) for the position, but they had to accede to
the request of MG Terminal, one of CMP Federal's valued clients.

Reyes claimed that, from then on, CMP Federal would treat him unaffably and that he would be
rebuked incessantly by his superiors, who told him that he was not fit for the job. He would also
be invariably snubbed by CMP Federal's Operations Manager, Arnel Maningat (Maningat), who
would relay orders and instructions from the main office to Sagun, and not to him, for
implementation.

On June 1, 2013, Reyes formally received Offence Notices pertaining to the complaints from CMP
Federal and was ordered immediately suspended until July 20, 2013.

On July 22, 2013, Reyes timely submitted his explanation, controverting the accusations against
him. Nevertheless, CMP Federal barred Reyes from reporting to work, and told him instead to await
the decision of the management regarding the complaints.

He was terminated and filed illegal dismissal.

LA ruled in favor of CMP, NLRC and CA ruled in favor of Reyes.

Issue: WON there is illegal dismissal

Held: No. The petitioners afforded Reyes with ample opportunity to be heard regarding the
complaints leveled against him. A formal hearing or conference was not necessary since nowhere
in any of his Written Explanations did Reyes request for one.

Few facts were also disputed since his justifications were replete with admissions and apologies.
Thus, without first going into the merits of the administrative complaints against Reyes, and his
defenses, the Court finds that Reyes was not denied procedural due process of law. The CA
therefore erred in ruling that the NLRC did not act with grave abuse of discretion when it reversed
the Decision of the Labor Arbiter.

16.De Leon v. Philippine Transmarine, G.R. No. 232194 | 2019-06-19

Facts: On January 31, 2005, de Leon began as a Hotel Personnel Planner for the Crewing
Department of respondent Philippine Transmarine Carriers, Inc. (PTC), a manning agency acting
as agent for foreign principals and engaged in the business of sending Filipino seafarers on board
ocean-going ships or vessels.

At the start of his employment, de Leon was given PTC's old company handbook.

On October 9, 2013, de Leon, along with a co-employee Aaron T. Brillante 17 (Brillante), was
caught on the CCTV accepting a brown bag from another employee Fred Rikko B. Adefuin
(Adefuin). 18 The brown bag — which contained two bottles of Jack Daniel's Whiskey — came
from Mr. Mustafa Acar (Acar), a friend and co-employee of de Leon when he was still working in
another vessel, the Oasis of the Sea .

The next day, he was confronted about the incident and he readily admitted that he and Brillante
did accept a gift.

In his answer to the memorandum, de Leon admitted to receiving the bottles of liquor, but insisted
that it was not a violation of the company policy for it did not come from a crewmember but from
an outsider.

On November 22, 2013, de Leon received a written resolution from PTC notifying him of the
termination of his employment. Meanwhile, PTC also terminated the employment of Brillante.

On January 30, 2014, de Leon filed a case for illegal dismissal with the Labor Arbiter. However, on
July 30, 2014, the Labor Arbiter dismissed the case for lack of merit.

Issue: WON there is illegal dismissal

Held: No. The Court has, in the past, 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. 42 In this case, the Court holds that PTC was well within its management
prerogative in terminating de Leon's employment upon a finding of violation of its company rules.

It is likewise well to note that, as pointed out by PTC and by the NLRC in its Resolution, de Leon's
actions reveal that he was aware that he was violating a company rule. He thus knew that he was
at risk of getting caught doing an act he should not do. Despite this, he still received the gift and
did not return the same to Acar or even turned over the same to the Human Resources Department
as instructed by the Code of Discipline. This therefore constitutes willful misconduct or
disobedience of company rules that further justifies PTC's decision to terminate de Leon's
employment.

17.De Leon v. NLRC, May 30, 2001

18.Sebuguero v. NLRC, 248 SCRA 532

Facts: The petitioners were among the thirty-eight (38) regular employees of private respondent
GTI Sportswear Corporation (hereinafter GTI), a corporation engaged in the manufacture and
export of ready-to-wear garments, who were given "temporary lay-off" notices by the latter on 22
January 1991 due to alleged lack of work and heavy losses caused by the cancellation of orders
from abroad and by the garments embargo of 1990.
Believing that their "temporary lay-off" was a ploy to dismiss them, resorted to because of their
union activities and was in violation of their right to security of tenure since there was no valid
ground therefor, the 38 laid-off employees filed with the Labor Arbiter's office in the National
Capital Region complaints for illegal dismissal, unfair labor practice, underpayment of wages
under Wage Orders Nos. 01 and 02, and non-payment of overtime pay and 13th month pay. 4

Private respondent GTI denied the claim of illegal dismissal and asserted that it was its
prerogative to lay-off its employees temporarily for a period not exceeding six months to prevent
losses due to lack of work or job orders from abroad, and that the lay-off affected both union and
non-union members. It justified its failure to recall the 38 laid-off employees after the lapse of six
months because of the subsequent cancellation of job order made by its foreign principals, a fact
which was communicated to the petitioners and the other complainants who were all offered
severance pay. Twenty-two (22) of the 38 complainants accepted the separation pay. The
petitioners herein did not.

Issue: WON there is illegal dismissal

Held: No. Redundancy exists where the services of an employee are in excess of what is
reasonably demanded by the actual requirements of the enterprise. A position is redundant where
it is superfluous, and superfluity of a position or positions may be the outcome of a number of
factors, such as overhiring of workers, decreased volume of business, or dropping of a particular
product line or service activity previously manufactured or undertaken by the enterprise.

Retrenchment, on the other hand, is used interchangeably with the term "lay-off." It is the
termination of employment initiated by the employer through no fault of the employee's and
without prejudice to the latter, resorted to by management during periods of business recession,
industrial depression, or seasonal fluctuations, or during lulls occasioned by lack of orders,
shortage of materials, conversion of the plant for a new production program or the introduction
of new methods or more efficient machinery, or of automation.

Simply put, it is an act of the employer of dismissing employees because of losses in the operation
of a business, lack of work, and considerable reduction on the volume of his business, a right
consistently recognized and affirmed by this Court.

The lack of written notice to the petitioners and to the DOLE does not, however, make the
petitioners' retrenchment illegal such that they are entitled to the payment of backwages and
separation pay in lieu of reinstatement as they contend. Their retrenchment, for not having been
effected with the required notices, is merely defective. In those cases where we found the
retrenchment to be illegal and ordered the employees' reinstatement and the payment of
backwages, the validity of the cause for retrenchment, that is the existence of imminent or actual
serious or substantial losses, was not proven. 26 But here, such a cause is present as found by
both the Labor Arbiter and the NLRC. There is only a violation by GTI of the procedure prescribed
in Article 283 of the Labor Code in effecting the retrenchment of the petitioners.|||

19.Philippine National Construction Corp. v. NLRC, 170 SCRA 207

Facts: On April 11, 1969, petitioner issued a regular appointment to the private respondent as
"Crane Operator" with compensation at the rate of P1.75 per hour.

Records show that from 1978 to May 23, 1985, private respondent worked for petitioner's project
in Malaysia, and was later advised to take a vacation and wait a call for his services.
On February 13, 1987, private respondent was again hired by the petitioner until August 16, 1989
when he received a notice terminating his services effective thirty (30) days from said date, citing
as a ground therefor retrenchment and the policy of the state to privatize government-owned and
controlled corporations. Private respondent was thus granted separation pay equivalent to two
years, covering the period from 1987 to 1989 under the petitioner's special separation program
for project employees.

Thereafter, private respondent pleaded for a separation pay equivalent to his full years of service,
and not just for two years. Failing to obtain a favorable response, private respondent, due to
financial constraints, executed a quitclaim and release in consideration of the amount of
P18,815.35, representing retrenchment and terminal benefits.

On December 28, 1989, private respondent brought a Complaint for illegal dismissal against the
petitioner, and praying for the payment of separation pay from April 1967 to September 1989.
Petitioner countered that the private respondent, being a project employee, is not entitled to
separation pay and that the cause of action of the private respondent has already prescribed.

Issue: WON the action prescribed

Held: NO. The Complaint of private respondent was filed perfectly within the three (3) year
prescriptive period within which to file a money claim. As aforestated; complainant (private
respondent) was not dismissed but merely asked to go on vacation in May 1985.

This was not ably disputed by respondent. It was only on August 16, 1989 that the private
respondent was informed of the termination of his services. Hence, when the private respondent
brought his Complaint in 1989, his cause of action was not yet barred by prescription. It was within
the three year prescriptive period under Article 291 of the Labor Code.

20.PLDT v. NLRC, 164 SCRA 671

Facts: The thirteen private respondents were all regular employees of the petitioner at the time of
their suspension. Sometime in February 1979, the private respondents were arrested by the
military authorities by virtue of an Arrest, Search and Seizure Order (ASSO) issued by the Minister
of National Defense.

They were detained at Camp Crame, Quezon City, up to April, 27, 1979. Their arrest was due to
their having been suspected by the petitioner of participation in a so-called "telehygienic" racket
consisting of selling hygienic mouthpieces to telephone subscribers, refusal of which by the latter
resulted in their telephones turning out of order.

The persons behind said mischief were allegedly acting in connivance with certain employees of
the petitioner. The arrest was prompted by a public clamor to stop the said racket.

On May 24, 1979, the petitioner informed the private respondents of their preventive suspension
leading to their dismissal, effective on the dates of their arrest. On June 1, 1979, three days after
the private respondents reported for work but were refuted admission by the petitioner, the letter
filed an application for clearance to dismiss the private respondents from employment.

On June 15, 1979, the private respondents in turn filed their own complaint for illegal dismissal .

Issue: WON there is illegal dismissal

Held: No. There is no disputing the proposition that if the private respondents really committed
serious misconduct and willful breach of trust, the termination of their employment is expressly
authorized under Article 283, paragraphs (b) and (d) of the Labor Code, as amended. Sadly enough,
however, the record is bereft of any competent showing to prove the imputation that the private
respondents acted in connivance with the perpetrators, or participated somehow in the
commission of the so-called "telehygienic" racket. The petitioner not having conducted its own
investigation to determine the truth of the alleged involvement of the private respondents in the
alleged racket, it relies merely on the action taken by the military authorities may have arrived at
was not presented in evidence, nor revealed by the petitioner in its petition.

The petitioner not having proved nor substantiated any ground to justify its alleged loss of
confidence in the private respondents so as to authorize their dismissal based on said ground,
We fail to see how the decision complained of may be said to have been rendered in wave abuse
of discretion. We have to recognize the constitutional right of the private respondents to "security
of tenure" (Article II, Section 9, Constitution); They not having given just and valid causes to
warrant the termination of their employment (Article 280, New Labor Code, as amended). Their
reinstatement entitles them to the payment of their back wages. Considering, however, that the
private respondents have been laid off for over four years during which period they were not
prevented from deriving income from some other gainful activity, the Court deems it fair that their
backwages should be limited to two years without deduction.

21.Pedroso v. Castro, 141 SCRA 252

Facts: On September 1, 1982, ANTONINO, PELAGIA, and ASIAO were arrested and detained by
military authorities by virtue of a Presidential Commitment Order (PCO). They were charged with
Conspiracy to Commit Rebellion under Article 136 of the Revised Penal Code before the then Court
of First Instance of Quezon City and were detained at Camp Crame.

To avoid disruption of work and business operations, MANHATTAN hired substitute workers for
the arrested employees.

On December 31, 1982, or approximately three (3) months after arrest, they were released but
refused admittance by the employer.

ANTONINO, PELAGIA and ASIAO then filed before the MOLE a Complaint for Illegal Dismissal and
Unfair Labor Practice against MANHATTAN.

LA, NLRC and CA ruled that there is no illegal dismissal.

Issue: WON there is illegal dismissal

Held: Yes. On different dates, ANTONINO and PELAGIA were released from military custody
showing that the charge against them had not been proven. Thus, the cause for their replacement
and dismissal by MANHATTAN was proved to be nonexistent. In the case of Pepito vs. Secretary
of Labor, 3 a nonexistent or false cause for dismissal was made plain.

Petitioners' separation from employment having been for a false or nonexistent cause is illegal.
Their reinstatement to their former positions, therefore, would have been warranted. 4 However,
it is undisputed that MANHATTAN has already hired replacements. To reinstate petitioners now
to their former position, therefore, would neither be fair nor just under the circumstances.
22.Anscor Transport v. NLRC, 190 SCRA 147

Facts: The private respondent, Pompei Crisostomo, was hired by the petitioner on October 11,
1982 to drive a truck. On October 25, 1984, Crisostomo set out to deliver reportedly 450 bags of
fertilizer from the Anscor Paco Office, in Manila, to Mandaluyong, arriving thereat an hour later.
When the cargo was unloaded in Mandaluyong, Anscor cargo handlers allegedly found that the
goods were short by twenty-nine bags.

On October 30 and November 6, 1984, Crisostomo was made to face an "investigative committee",
upon charges of theft, which he denied and wherein he claimed that the bags might have been
overcounted upon loading. On November 7, 1984, Anscor dismissed him.

On April 4, 1986, Crisostomo went to the labor arbiter on a complaint for illegal dismissal. On
January 4, 1988, the labor arbiter ordered his reinstatement with backwages. On October 28, 1988,
the respondent National Labor Relations Commission affirmed, save for the modifications earlier
adverted to, the labor arbiter's decision.

Issue: WON there is illegal dismissal

Held: Yes. The fact that there was "evidence" (assuming it was "evidence") that the petitioner was
liable, we do not find it to be evidence that is substantial enough along the teaching of Ang Tibay.

As we said, Anscor itself can not say for sure that it had in fact lost twenty-nine bags of fertilizer,
and if the corpus delicti, as it were, was doubtful, to pin responsibility for the "loss" on another is
even more doubtful. Contrary to Anscor's opinion, the alleged evidence against Crisostomo was
hardly "airtight", 12 assuming it constitutes evidence at all.

Although loss of confidence is a valid cause to terminate employee, it must however rest on an
actual breach of duty committed by the employee and not on the employer's caprices.

It must be stressed that the aggrieved employees occupied responsible positions (a high school
teacher in Divine Word, a vice-president in Asiaworld), in which a consistent level of confidence is
required. In the case at bar, however, the private respondent was a company driver, a position that
does not obviously call for the trust management reposes, say, upon a vice-president .

And obviously, Divine Word and Asiaworld were decided on the merits of their peculiar conditions.
These conditions, however, are, to repeat, peculiar, and can not be applied universally. 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.

23.Globe Mackay Cable & Wire Corp. v. NLRC, 206 SCRA 701

Facts: 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 air conditioning 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.

It likewise appeared in the course of Maramara's investigation that Imelda Salazar violated
company regulations 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. Salazar filed a case for illegal dismissal.

Issue: WON there is illegal dismissal

Held: Yes. The investigative 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 the 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 of any alleged malfeasance or
misfeasance committed by the employee.

To go back to the instant case, 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 as 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, condition, position,
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."

24.Quijano v. Mercury Drug Corporation, 292 SCRA 109

Facts: Petitioner Dandy V. Quijano was a warehouseman at the central warehouse of respondent
Mercury Drug Corporation in Libis, Quezon City, since 1983. Through the years, the company has
recognized and commended him for his dedication to his work.

He has actively articulated the employees' concerns, he exposed the existence of a five -six loan
system in their workplace operated by some of its officers. He incurred the ire of respondent's
manager Mr. Antonio Altavano who operated the usurious transactions.

Then followed the harassment of the petitioner by his superiors. Respondent charged petitioner
with four (4) violations of company policies:
a) loafing and abandonment of work;

b) disrespect to his superiors;

c) disrupting the work of his co-employees; and

d) using abusive language in company premises.

Consequently, four (4) notices of corrective/disciplinary action were served on petitioner for the
above four offenses. In his written explanation, petitioner denied the charges and claimed that the
same were merely concocted by the warehouse manager and the supervisor in retaliation to his
exposure of the latter's usurious loan scheme in the warehouse, thereby taking undue advantage
of the plight of his co-employees.

Subsequently, a Special Investigating Committee created by management to further investigate

petitioner's alleged offenses, found the petitioner guilty and terminated his employment. Left
without recourse, petitioner filed an illegal dismissal case against respondent before the labor
arbiter.

The labor arbiter ruled that petitioner was illegally dismissed from service for lack of just cause.
Respondent reinstated petitioner in the payroll, then appealed the decision of the labor arbiter to
the NLRC. The NLRC affirmed the finding of illegal dismissal by the labor arbiter. However, it
modified the decision by: (1) limiting the award of backwages to three years; (2) deleting the award
of moral and exemplary damages; and (3) ordering respondent to pay petitioner separation pay in
lieu of reinstatement. Petitioner moved for reconsideration but the NLRC still denied payment of
damages and also refused to reinstate petitioner in view of the brewing antagonism between
petitioner and his supervisor. In this petition, petitioner insists that he is entitled to reinstatement
as he was illegally dismissed and his reinstatement is feasible under the circumstances.

Issue: WON an illegally dismissed employee is entitled to reinstatement

Held: Yes. The Supreme Court ruled that an illegally dismissed employee is entitled to
reinstatement as a matter of right. The Court ruled that respondent's charges against petitioner
could not serve as basis to justify petitioner's dismissal. The charges had been found to be
baseless and both the labor arbiter and the NLRC agreed that there was no just cause for
petitioner's dismissal. The antagonism was caused substantially if not solely by the misdeeds of
respondent's superiors.

To deny petitioner's reinstatement due to "strained relations" with his accusers whose charges
were found to be false would result in rewarding the accusers and penalizing petitioner, the victim.
This would set a bad precedent, for no employer should be allowed to profit from his own misdeed.
The Court also ruled that the circumstances in the case at bar justify the award of moral and
exemplary damages to petitioner. Respondent's fabrication of charges against petitioner to
facilitate his immediate dismissal from service is undoubtedly contrary to good customs and
public policy.

25.Capili v. NLRC, 270 SCRA 488

Facts: Respondents are licensed drivers of public utility jeepneys plying the Libertad-Sta. Cruz
route in Manila. The jeepneys were formerly owned by petitioner Gil Capili. For the use of the
jeepney for twelve hours a driver would pay rent or so-called "boundary" of P280.00 and earn a
net profit of P200.00 per day.

On 7 May 1991, at a time when petitioner Ricardo Capili jointly with his wife had assumed
ownership and operation of the jeepneys driven by private respondents, the latter and the other
drivers similarly situated were required by the jeepney operators to sign individually contracts of
lease of the jeepneys to formalize their lessor-lessee relationship. However, having gathered the
impression that the signing of the contracts of lease was a condition precedent before they could
continue driving for petitioners, all the drivers stopped plying their assigned routes beginning 7
May 1991.

A week later or on 14 May 1991 the drivers, numbering twenty- two (22), filed a complaint for
illegal dismissal before the Labor Arbiter praying not for reinstatement but for separation pay.

LA and NLRC ruled that the Employee-employer relationship was severed voluntarily but awarded
separation pay.

Issue: WON respondents are entitle to separation pay

Held: No. The award of separation pay cannot be justified solely because of the existence of
"strained relations" between the employer and the employee. It must be given to the employee
only as an alternative to reinstatement emanating from illegal dismissal. When there is no ill egal
dismissal, even if the relations are strained, separation pay has no legal basis.

Besides, the 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.

26.Buenviaje v. CA, G.R. No. 147806, November 12, 2002

Facts: Petitioners were former employees of Cottonway Marketing Corp. (Cottonway), hired as
promo girls for their garment products. In October, 1994, after their services were terminated as
the company was allegedly suffering business losses, petitioners filed with the National Labor
Relations Commission (NLRC) a complaint for illegal dismissal, underpayment of salary, and non-
payment of premium pay for rest day, service incentive leave pay and thirteenth month pay against
Cottonway Marketing Corp. and Network Fashion Inc./JCT International Trading.

LA ruled for Cottonway. Reversed by NLRC and ordered reinstatement of petitioners.

On August 30, 1996, Cottonway filed with the NLRC a manifestation stating that they have
complied with the order of reinstatement by sending notices dated June 5, 1996 requiring the
petitioners to return to work, but to no avail; and consequently, they sent letters to petitioners
dated August 1, 1996 informing them that they have lost their employment for failure to comply
with the return to work orders.

CA ordered reinstatement.

Issue: Whether the computation of backwages should be computed from the time of their illegal
dismissal until their actual reinstatement as argued by the petitioners.
Held: Yes. Reinstatement restores the employee to the position from which he was removed, i.e.,
to his status quo ante dismissal, while the grant of backwages allows the same employee to
recover from the employer that which he lost by way of wages because of his dismissal.

Under R.A. 6715, employees who are illegally dismissed are entitled to full backwages, inclusive
of allowances and other benefits or their monetary equivalent, computed from the time their actual
compensation was withheld from them up to the time of their actual reinstatement. If
reinstatement is no longer possible, the backwages shall be computed from the time of their illegal
termination up to the finality of the decision.

It appears that the supposed notice sent by Cottonway to the petitioners demanding that they
report back to work immediately was only a scheme to remove the petitioners for good.
Petitioners' failure to instantaneously abide by the directive gave them a convenient reason to
dispense with their services. This the Court cannot allow. Cottonway, cited Article 223 of the Labor
Code providing that the decision ordering the reinstatement of an illegally dismissed employee is
immediately executory even pending appeal as basis for its decision to terminate the employment
of petitioners.

27.Filflex Industrial & Manufacturing Corp. v. NLRC, Feb. 12, 1998

Facts: Private respondent herein was dismissed for abandonment of work. She claimed, however,
that her dismissal on the said ground is not in consonance with the law considering that her
absences were due to sickness wherein her employer was duly notified.

The petitioner herein contended otherwise. It alleged that complainant has been committing
various violations of company rules and regulations ever since. And despite several warnings,
private respondent persisted in her tardiness and frequent absences. Finally, due to her absences
from November 30, 1990 to December 11, 1990, she was required to explain why she should not
be dismissed for having abandoned her job considering that she had been earlier warned against
similar violations. Thereafter, petitioner dismissed private respondent for failure to report for work
and explain her absences without permission.

The Labor Arbiter declared the dismissal of private respondent improper and unjust. She was
awarded limited backwages and other benefits plus separation pay. The Labor Arbiter did not
order her reinstatement. On appeal, Respondent NLRC ruled that the dismissal of private
respondent was justified. It held however, that Article 223 of the Labor Code required the
reinstatement of private respondent during the pendency of her appeal. Hence, the NLRC awarded
private respondent her salaries from the date of the filing of the appeal up to the date of the
promulgation of its Resolution.

Issue: WON the private respondent is entitled to separation pay

Held: No. Private respondent cannot now be granted separation pay or any other affirmative relief
previously awarded to her by the labor arbiter but reversed by the NLRC. Since she did not appeal
from the NLRC's Resolution, she is presumed to be satisfied with the adjudication therein. This is
in accord with the doctrine that a party who has not appealed cannot obtain from the appellate
court any affirmative relief other than the ones granted in the appealed decision.
Reinstatement during appeal is warranted only when the Labor Arbiter himself rules that the
dismissed employee should be reinstated. Here, the Labor Arbiter's decision never ordered the
reinstatement of private respondent. Further, the backwages granted in the said decision were
specifically limited to the period prior to the filing of the appeal with respondent NLRC. In fact, the
decision ordered her separation from service. Hence, it is an error for the NLRC to hold that the
award of limited backwages, by implication, included an order for private respondent's
reinstatement.

28.Grolier International Inc. v. Executive Labor Arbiter, 177 SCRA 196

29.Paramount Vinyl Products Corp. v. NLRC, 190 SCRA 525

30.Mariners Polytechnic School v. Leogardo, 171 SCRA 597

31.Lantion v. NLRC, 181 SCRA 513

32.Pizza Inn v. NLRC, 162 SCRA 773

Facts: Private respondent was employed by petitioner in its Quad Carpark Makati outlet on a
probationary status with a monthly basic salary of P500.00. Before the expiration of the 6-month
probationary period, Felicidad Fontanilla resigned. Claiming that she was forced to resign by the
petitioner, the former filed a complaint against the latter.

Due to the finality of the judgment in this case, the Labor Arbiter below issued a second alias Writ
of Execution dated September 8, 1984 against petitioner wherein the amount involved
(representing backwages of private respondent among others, from April 24, 1982 to September
30, 1984) amounted to P29,001.00 as per computation of the Socio-Economic Analyst of the
Commission.

Quad Carpark Makati outlet was closed by the employer

Issue: WON the private respondent should be reinstated

Held: No. Reinstatement pre-supposes that the previous position from which one had been
removed still exists or that there is an unfilled position more or less of similar nature as the one
previously occupied by the employee. Admittedly, no such position is available. Reinstatement
therefore becomes a legal impossibility. The law cannot exact compliance with what is
impossible. Moreover an employer is privileged to go out of business by closing the same
regardless of his reasons especially if done in good faith and due to causes beyond his control
like heavy business losses. To deprive him of such privilege would be oppressive and inhuman.
In such cases, the dismissed employee can no longer be reinstated but shall be entitled to
backwages up to the date of dissolution or closure (but not exceeding three years).

As aforementioned the order of reinstatement becomes a legal impossibility as the outlet closed
on January 31, 1984. Computing backwages beyond January 1984, the date of closure, would not
only be unjust but confiscatory as well as violative of the Constitution depriving the petitioner of
his property rights. The unlimited award would not only prejudice the herein petitioner but would,
as well, impose a crushing financial burden on the already financially distressed petitioner
corporation. The fact that the computation of the backwages was done ex-parte without giving
petitioner a chance or opportunity to comment on said computation is clearly a denial of due
process.

33.Bustamante v. NLRC, 265 SCRA 61

34.Buhain v. CA, G.R. No. 143709, July 2, 2002

35.Wenphil Corp. v. NLRC, 170 SCRA 69

36.Serrano v. NLRC, G.R. No. 117040, January 27 & May 4, 2000

Facts: Petitioner Ruben Serrano, head of the Security Checkers Section of Isetann, herein private
respondent, was served with a letter dated October 11, 1991 informing him of his termination
effective on the same date on the ground of retrenchment to the effect that the company will
phase out its entire security section and engage the services of an independent security agency.
In a complaint for illegal dismissal filed against Isetann by petitioner, the Labor Arbiter found,
among others, that Isetann failed to establish that retrenchment was resorted to in order to
prevent or minimize losses to its business and that it failed to accord petitioner due process for
failure to serve prior notice. Isetann was ordered to reinstate and pay petitioner full backwage s
without qualification or deduction computed from the time of his dismissal until reinstatement.
On appeal, the Labor Arbiter's decision was reversed. The NLRC held that the phaseout of the
section and the hiring of an independent security agency constituted a legitimate business
decision. Isetann was ordered to pay petitioner separation pay equivalent to one month for every
year of service. A motion for reconsideration filed by petitioner was, denied, hence this petition.

Issue: WON there is illegal dismissal

Held: NO. The Supreme Court held that an employee's termination on ground of redundancy or
reduction of personnel is valid, the same being an exercise of an employer's business judgment
or management prerogative and the Court, in the absence of proof that management acted in a
malicious or arbitrary manner, will not interfere with the valid exercise of judgment by an
employer.

Failure of an employer to comply with the requirement of prior notice under Article 283 of the
Labor Code is not a denial of due process as it does not foreclose the right of the latter to question
the legality of his dismissal. It is but a failure to observe a procedure for the termination of
employment which makes the termination of employment merely ineffectual which renders th e
employer liable to the payment of separation pay equivalent to one (1) month pay for every year
of service and full backwages.

37.PNCC v. NLRC, 286 SCRA 329

38.Dela Cruz v. NLRC, November 20, 1998

39.Equitable Banking Corp. v. NLRC, June 13, 1997

40.Millares v. NLRC, 305 SCRA 500

43. ESTIVA VS. NATIONAL LABOR RELATIONS COMMISSION, JAIME KOA AND OPSONIN
CHEMICAL INDUSTRIES PHILIPPINES CORPORATION (OPSONIN)
225 SCRA 169 | AUGUST 05, 1993

FACTS: Estitva was employed by Opsonin as operations manager with basic monthly salary of
P6,500. As operations manager, his task was to conceptualize or conduct feasibility studies,
formulate overall marketing plans, train field employees and office staff as well as provide insights
to the company owners on the complexities of pharmaceutical marketing and distribution
operations. He was later on appointed as sales manager with salary of P11,000.00 and additional
fringe benefits. After a year, the Chairman of the board named Koa began to discharge some of
the functions of the sales manager, such as meeting with petitioner’s subordinates, and preparing
and signing the appointment papers of probationary and permanent employees. Koa formally
announced that he was assuming the position of sales manager.

Estiva filed a complaint with NLRC (Arbitrary Branch) for illegal dismissal, illegal deduction, 13th
month pay, service incentive leave pay, reimbursement of advanced expenses, with prayer for
moral and exemplary damages, plus attorney’s fees. A day after, Opsonin issued a memorandum
to Estiva accusing him of his absence, tardiness, refusal to sign log books, and never submitted
weekly reports of accomplishments.

ISSUE/S:

1. W/N Estiva was illegally dismissed by Opsonin and was denied of due process and
hearing.

2. W/N loss of confidence is a ground for dismissal.

HELD:

1. YES. Requirements for valid termination was not followed by Opsonin. The company did
not furnish him two (2) written notices before terminating Estiva. (1) Notices apprising his acts or
omissions, (2) after notice and hearing, informs him of the employer’s decision to dismiss him.
The fact that Estiva is a managerial employee, no less than rank-and-file laborers are entitled to
due process.

2. YES. Loss of confidence as ground for dismissal requires substantial evidence. In the case
at bar, the respondents failed to prove that the dismissal of Estiva was on account of loss of
confidence arose from particular proven facts. No opportunity was given to him to meet the
charges levelled against him. In fact, he was dismissed from the service even before he learned
of the grounds for his dismissal and which fact was not successfully controverted by private
respondents.
44. PHILIPPINE AEOLUS AUTOMOTIVE UNITED CORPORATION (PAAUC) VS. NLRC,

G.R. No. 124617 | April 28, 2000

FACTS: Rosalinda Cortez was a company nurse for the PAAUC. A memorandum was issued by the
personnel manager of petitioner corporation to respondent Cortez asking her to explain why n o
action should be taken against her for (1) throwing a stapler at plant manager William Chua; (2)
fro losing the amount of Php 1,488 entrusted to her; (3) for asking a co-employee to punch in her
time card one morning when she was not there. She was then placed on preventive suspension.
Another memorandum was sent to her asking her to explain why she failed to process the ATM
applications of her co-employees. She submitted a written explanation as to the loss of Php 1,488
and the punching in of her time card. A third memorandum was sent to her informing her of her
termination from service for gross and habitual neglect of duties, serious misconduct, and fraud
or willful breach of trust.

ISSUES:

1. W/N petitioner was illegally dismissed.

2. If such dismissal was illegal, W/N petitioner should be entitled to damages.

HELD:

1. Yes. The grounds by which an employer may validly terminate the services of an employee must
be strictly construed. As to the first charge, respondent claims that plant manager Willia m Chua
had been making sexual advances on her since her first year of employment and that when she
would not accede to his requests, he threatened that he would cause her termination from service.
As to the second charge, the money entrusted to her was not lost, but given to the personnel-in-
charge for proper transmittal as evidence by a receipt signed by the latter. As to the third charge,
she explains that she asked someone to punch in her card as she was doing an errand for one of
the company’s officers and with the permission of William Chua. As to the fourth charge, she
asserts that she had no knowledge thereof. To constitute serious misconduct to justify dismissal,
the acts must be done in relation to the performance of her duties as would show her to be unfit
to continue working for her employer. The acts of did not pertain to her duties as a nurse nor did
they constitute serious misconduct. However due to the strained relations, in lieu of
reinstatement, she is to be awarded separation pay of one month for every year of service until
finality of this judgment.

2. Yes. Cortez admittedly allowed four years to pass before coming out with her employer’s sexual
impositions; but the time to do such varies depending upon the needs, circumstances and
emotional threshold of the employee. It is clear that respondent has suffered anxiety, sleepless
nights, besmirched reputation and social humiliation by reason of the act complained of. Thus,
she should be entitled to moral and exemplary damages for the oppressive manner with which
petitioner’s effected her dismissal and to serve as a warming to officers who take advantage of
their ascendancy over their employees.

45. REAHS CORPORATION VS. NATIONAL LABOR RELATIONS COMMISSION,

271 SCRA 247 | April 15, 1997

FACTS: The respondents were workers of Reah’s Corporation who filed their complaints before
NLRC for underpayment of wages, holiday pay, 13th month pay and separation pay after closing
the establishment.

On the other hand, respondents allege that sometime in 1986, a certain Ms. Soledad Domingo, the
sole proprietress and operator of Rainbow Sauna offered to sell her business to respondent
Reah’s Corporation. After the sale, all the assets of Ms. Domingo were turned over to respondent
Reah’s, which put a sing-along, coffee shop, and massage clinic; that complainant Red started
his employment on the first week of December 1988 as a roomboy at P50.00/day and was given
living quarters inside the premises as he requested; that sometime in March 1989, complainant
Red asked permission to go to Bicol for a period of ten (10) days, which was granted, and was
given an advance money of P1,200.00 to bring some girls from the province to work as attendants
at the respondent’s massage clinic, that it was only on January 1, 1990 that complainant Red
returned and was re-hired under the same terms and conditions of his previous employment with
the understanding that he will have to refund the P1,200.00 cash advance given to him; that due
to poor business, increase in the rental cost and the failure of Meralco to reconnect the electrical
services in the establishment, it suffered losses leading to its closure.

ISSUE: W/N the employer can terminate the employment of any employee due to the closing or
cessation of operation of the establishment.

HELD: YES. The rule is that in all cases of business closure or cessation of operation or
undertaking of the employer, the affected employee is entitled to separation pay except when the
closure of business or cessation of operations is due to serious business losses or financial
reverses, duly proved.—The rule, therefore, is that in all cases of business closure or cessation of
operation or undertaking of the employer, the affected employee is entitled to separation pay. This
is consistent with the state policy of treating labor as a primary social economic force, affording
full protection to its rights as well as its welfare. The exception is when the closure of business or
cessation of operations is due to serious business losses or financial reverses, duly proved, in
which case, the right of affected employees to separation pay is lost for obvious reasons. In the
case at bar, the corporation’s alleged serious business losses and financial reverses were not
amply shown or proved.
46. PABALAN VS. NATIONAL LABOR RELATIONS COMMISSION

184 SCRA 495 | April 20, 1990

FACTS: Eighty-four (84) workers of the Philippine Inter-Fashion (PIF) filed a complaint against the
latter for illegal transfer simultaneous with illegal dismissal in violation of the Labor Code. PIF
was notified about the complaint and summons but hearings were continually re-set for failure of
its officers (petitioners herein) to appear. Complainant workers thus moved to implead petitioners
as officers of PIF in the complaint for their illegal transfer to a new firm. The Labor Arbiter ruled
in favor of workers holding petitioners-officers jointly and severally liable with PIF to pay them
their benefits. Petitioners’ appeal was dismissed.

ISSUE: W/N petitioners as officers may be held jointly and severally liable with the corporation for
its liability.

HELD: NO. The settled rule is that the corporation is vested by law with a personality separate and
distinct from the persons composing it, including its officers as well as from that of any other
legal entity to which it may be related. Thus, a company manager acting in good faith within the
scope of his authority in terminating the services of certain employees cannot be held personally
liable for damages. However, the legal fiction that a corporation has a personality separate and
distinct from stockholders and members may be disregarded when the notion of legal entity is
used as a means to perpetrate fraud or an illegal act or as a vehicle for the evasion of an existing
obligation, the circumvention of statutes, and or (to) confuse legitimate issues the veil which
protects the corporation will be lifted.

47. ASIONICS PHILIPPINES, INC. VS. NLRC

290 SCRA 164 | May 19, 1998

FACTS: API is a domestic corporation engaged in the business of assembling semi-conductor

chips and other electronic products mainly for export. Yolanda Boaquina and Juana Gayola
started working for API in 1979 and 1988, respectively, as material control clerk and as production
operator. During the third quarter of 1992, API commenced negotiations with the duly recognized
bargaining agent of its employees, the Federation of Free Workers (“FFW”), for a Collective
Bargaining Agreement (“CBA”). A deadlock, however, ensued and the union decided to file a notice
of strike. This event prompted the two customers of API, Indala and CP Clare Theta J, to thereupon
refrain from sending to API additional kits or materials for assembly. API, given the circumstance
that its assembly line had to thereby grind to a halt, was forced to suspend operations pursuant
to Article 2863 of the Labor Code. Private respondents Boaquina and Gayola were among the
employees asked to take a leave from work.

Inasmuch as its business activity remained critical, API was constrained to implement a
company-wide retrenchment affecting one hundred five (105) employees from a work force that
otherwise totalled three hundred four (304). The selection was based on productivity/performance
standards pursuant to the CBA. Yolanda Boaquina was one of those affected. As a result, they
filed a complaint for illegal dismissal against the corporation and Frank Yih, as president and
majority stockholder of the company.

ISSUE: W/N Frank Yih be held liable for the obligation of the company absent any proof of bad
faith.

HELD: YES. The court cannot agree with the Solicitor-General in suggesting that even if Frank Yih
had no direct hand in the dismissal of the respondents he should be personally liable therefor on
account alone of his being the President and majority stockholder of the company. It is basic that
a corporation is invested by law with a personality separate and distinct from those of the persons
composing it as well as from that of any other legal entity to which it may be related. Mere
ownership by a single stockholder or by another corporation of all or nearly all of the capital stock
of a corporation is not of itself sufficient ground for disregarding the separate corporate
personality. Petitioner Sunio, therefore, should not have been made personally answerable for the
payment of private respondents’ back salaries.’

48. CEBU ROYAL PLANT VS. DEPUTY MINISTER OF LABOR

153 SCRA 38 | August 12, 1987

FACTS: Ramon Pilones, private respondent, was employed on February 16, 1978 on a probationary
period of employment for six (6) months with petitioner CRP. After said period, he underwent
medical examination for qualification as regular employee but the results showed that he is
suffering from PTB minimal. Consequently, he was informed of the termination of his employment
by respondent since his illness was not curable within 6 months. Pilones complained against his
termination before the Ministry of Labor which dismissed the same. The dismissal was reversed
by the public respondent who ordered the reinstatement and payment of back wages.

Granting reinstatement, the public respondent argues that Pilones was already a permanent
employee at the time of his dismissal and so was entitled to security of tenure. The alleged ground
for his removal, to wit, “pulmonary tuberculosis minimal,” was not certified as incurable within six
months as to justify his separation and that the petitioner should have first obtained a clearance,
as required by the regulations then in force, for the termination of his employment.

CRP claims that the private respondent was still on probation at the time of his dismissal and so
had no security of tenure. The dismissal was necessary for the protection of the public health, as
he was handling ingredients in the processing of soft drinks which were being sold to the public.
ISSUE: W/N the dismissal was proper.

HELD: No. An employee who is allowed to work after a probationary period shall be considered a
regular employee.—As there is no mention of the basis of the above order, we may assume it was
the temporary payroll authority submitted by the petitioner showing that the private respondent
was employed on probation on February 16, 1978. Even supposing that it is not self-serving, we
find nevertheless that it is self-defeating. The six-month period of probation started from the said
date of appointment and so ended on August 17, 1978, but it is not shown that the private
respondent's employment also ended then; on the contrary, he continued working as usual. Under
Article 282 of the Labor Code, "an employee who is allowed to work after a probationary period
shall be considered a regular employee." Hence, Pilones was already on permanent status when
he was dismissed on August 21, 1978, or four days after he ceased to be a probationer.

49. TAN VS. NATIONAL LABOR RELATIONS COMMISSION

271 SCRA 216 | April 14, 1997

FACTS: Garrido alleged that on 28 January 1989 his right hand (little finger) was injured while he
was lifting heavy boxes of concrete nails in the store of petitioner. As a consequence, he had to
stop working. Despite his injury however Emma Tan, General Manager and wife of petitioner,
ordered him to continue lifting the heavy boxes. When he refused because his injured finger made
the task extremely difficult and painful, besides being risky, Emma Tan promptly called up her
lawyer. Atty. Roberto B. Arca arrived and demonstrated how Garrido could continue lifting the
heavy boxes by using only his four (4) other fingers. When Garrido persistently refused as he
wanted to have his injured finger treated first, Atty. Arca then and there served him with a letter4
directing him to explain why no disciplinary action should be taken against him for failing to obey
a valid order of his employer. Upon his return three (3) working days later, after his finger was
already treated, Emma Tan told him to “go to hell.” The remark notwithstanding, he loitered around
the store premises for the next four (4) days but was treated like a leper.5 He was eventually
dismissed for alleged abandonment of work ten (10) days later.

Antonio Ibutnandi, on the other hand, was dismissed because he failed to present a medical
certificate from a government doctor certifying that he was already cured of pulmonary
tuberculosis (PTB), hence, already fit to work.

ISSUE: W/N Respondents Garrido and Ibutnandi were illegally dismissed.

HELD: Yes. Mere absence or failure to report for work is not enough to amount to such
abandonment.—Besides, jurisprudence dictates that for abandonment to constitute a valid
ground for dismissal there must be a clear, deliberate and unjustified refusal to resume
employment and a clear intention to sever the employer-employee relationship on the part of the
employee. It is emphatically stated that mere absence or failure to report for work is not enough
to amount to such abandonment. Hence, Garrido’s absences which were at first due to his job-
related injury and, subsequently, the hostile treatment given him by petitioner’s wife ever since
the labor standards complaint was filed could hardly amount to abandonment of his work. It would
be the height of injustice to allow an employer to claim as a ground for abandonment a situation
which he himself had brought about.

In the case of Ibutnandi, it cannot be denied that he became afflicted with pulmonary tuberculosis
(PTB) and that under Art. 284 of the Labor Code, an employer may terminate the services of his
employee found to be suffering from any disease and whose continued employment is prohibited
by law or is prejudicial to his health as well as to that of his co-employees. However, the fact that
an employee is suffering from such a disease does not ipso facto make him a sure candidate for
dismissal as what petitioner did with respondent Ibutnandi.

50. PHILIPPINE SCOUT VETERANS SECURITY AND INVESTIGATION AGENCY v. NLRC

271 SCRA 209 | April 14, 1997

FACTS: MARIANO FEDERICO, private respondent, had been working with petitioners Philippine
Scout Veterans Security and Investigation Agency and/or Severo Santiago as a security guard for
twenty-three (23) years. On 16 September 1991 Federico, then already sixty (60) years old,
tendered his so-called “letter of resignation” citing as his reasons physical disability to perform
his duties and desire to spend the rest of his life in the province. It seems that the letter did not
strictly refer to “resignation” but “withdrawal from occupation” because thereafter he sought
alternative reliefs from petitioners, namely, termination pay corresponding to his years of service,
or retirement benefits.

Petitioners rejected the claim for termination pay contending that respondent Federico voluntarily
resigned. The claim for retirement benefits met the same fate there being no collective or
individual agreement providing therefor.

NLRC set aside on appeal the subject Decision, relying on Art. 287 of the Labor Code as amended
by R.A. 7641 which, in the absence of a retirement plan or agreement providing for retirement
benefits, grants retirement pay equivalent to fifteen (15) days for every year of service.2 The
amendment, which took effect on 7 January 1993, was thus retroactively applied in favor of
respondent Federico. On 21 March 1994, NLRC denied reconsideration of the Decision.

ISSUE: W/N Art. 287 of the Labor Code as amended by R.A. 7641 may be applied retroactively to
the complaint filed on 4 December 1991 by respondent Mariano Federico.
HELD: YES. Under the amendment, respondent Federico appears to be entitled to retirement pay.
But can he avail himself of this provision considering that it took effect subsequent to his filing of
the complaint? This brings to mind the principle reiterated in Allied that police power legislation
intended to promote public welfare applies to existing contracts and can therefore be given
retroactive effect. Actually, the case at bench no longer presents a novel issue. We have ruled in
Oro Enterprises, Inc. v. NLRC that R.A. 7641 can indeed be applied retroactively.

Circumstances that must concur before the law can be given retroactive effect.—At this point we
emphasized the circumstances, based on Oro, that must concur before the law could be given
retroactive effect: (a) the claimant for retirement benefits was still the employee of the employer
at the time the statute took effect; and, (b) the claimant was in compliance with the requirements
for eligibility under the statute for such retirement benefits.

51. AQUINO VS. NATIONAL LABOR RELATIONS COMMISSION

206 SCRA 118 | February 11, 1992

FACTS: The petitioners’ services were terminated on the ground of retrenchment, and they
received separation pay double that required by the Labor Code. Thereafter, they demanded
retirement benefits, invoking the Retirement Plan of the respondent company which they said was
contractual rather than statutory.

The petitioners were employees of private respondent Otis Elevator Company when they were
informed of the termination of their employment in line with the need of the company “to
streamline its operations, consolidate certain functions, reduce its manpower and cut non -
essential spending.” The separate letters addressed to the petitioners advised them that —

In lieu of notice, they shall be paid one month’s equivalent salary, plus their regular allowances,
counted from such date, and they shall be covered with the normal benefits for that period. they
shall also be paid their earned and/or unused sick leave and vacation leave, including pro-rata
13th month pay. And for every year of service with the Company, they shall be paid one month’s
basic salary or their retirement benefits, if applicable to them, whichever is higher.

ISSUE: Having received the separation pay, were the petitioners still entitled to the retirement
benefits?

HELD: Retirement benefits, where not mandated by law, may be granted by agreement of the
employees and their employer or as a voluntary act on the part of the employer.—Retirement
benefits, where not mandated by law, may be granted by agreement of the employees and their
employer or as a voluntary act on the part of the employer. Retirement benefits are intended to
help the employee enjoy the remaining years of his life, lessening the burden of worrying for his
financial support, and are a form of reward for his loyalty and service to the employer.

The retirement benefits of the petitioners come up to a substantial figure, considering their
respective lengths of service with the company. These benefits, added to the separation pay they
have already received, make up a tidy sum indeed. The point, however, is that the petitioners are
entitled to this amount under the provisions of the CBA and the Retirement Plan freely entered
into by the parties. These instruments are binding agreements, not being contrary to law, morals,
good customs, public order or public policy, and must therefore be upheld.

52. PRODUCERS BANK OF THE PHILIPPINES VS. NLRC and PRODUCERS BANK EMPLOYEES
ASSOCIATION

298 SCRA 517 | November 16, 1998

FACTS: Petitioner was placed by Central Bank of the Philippines (Bangko Sentral ng Pilipinas)
under a conservator for the purpose of protecting its assets. When the respondents ought to
implement the CBA (Sec. 1, Art. 11) regarding the retirement plan and pertaining to uniform
allowance, the acting conservator of the petition expressed objection resulting an impasse
between the petitioner bank and respondent union. The deadlock continued for at least six
months. The private respondent, to resolve the issue filed a case against petitioner for unfair labor
practice and flagrant violation of the CBA.

The Labor Arbiter dismissed the petition. NLRC reversed the findings and ordered the
implementation of the CBA.

ISSUE: W/N the employees who have retired have no personality to file an action since there is no
longer an employer-employee relationship.

HELD: No.Employees who have retired still have the personality to file a complaint. Retirement
results from a voluntary agreement between the employer and the employee whereby the latter
after reaching a certain age agrees to sever his employment with the former. The very essence of
retirement is the termination of employer-employee relationship. Retirement of the employee
does not in itself affect his employment status especially when it involves all rights and benefits
due to him, since these must be protected as though there had been no interruption of service.
It must be borne in mind that the retirement scheme was part of the employment package and the
benefits to be derived therefrom constituted as it were a continuing consideration of services
rendered as well as an effective inducement foe remaining with the corporation. It is intended to
help the employee enjoy the remaining years of his life. When the retired employees were
requesting that their retirement benefits be granted, they were not pleading for generosity but
merely demanding that their rights, embodied in the CBA, be recognized. When an employee has
retired but his benefits under the law or CBA have not yet been given, he still retains, for the
purpose of prosecuting his claims, the status of an employee entitled to the protection of the
Labor Code, one of which is the protection of the labor union.

53. CAPILI VS. NATIONAL LABOR RELATIONS COMMISSION

273 SCRA 576 | June 17, 1997

FACTS: Capili was employed by University of Mindanao (hereafter, UM) as a college instructor.
UM informed Capili that under the law and UM’s retirement program he would be eligible for
retirement when he would reach the age of 60 year. In his answer, Capili informed UM that
pursuant to Section 4, Rule II, Book VI of the Rules Implementing the Labor Code, he was not
opting to retire but would continue to serve until he reaches the compulsory retirement age of 65.
In its reply to UM, UM reiterated its position that under the university’s retirement plan, it could
retire him. It argued that under Section 4 cited by the petitioner, the employee has the option only
in the absence of a retirement plan.

Perceiving the school’s insistence as constructive dismissal, and recalling at least four other
faculty members who were allowed to teach beyond their sixtieth birth anniversary, the Capili filed
a complaint for illegal dismissal. He sought his reinstatement to his former position without loss
of seniority rights with full back wages, wage differential, 13th month differential, moral and
exemplary damages, and attorney’s fees.

ISSUES:

1. Whether an instructor of a private educational institution may be compelled to retire at the

age of sixty years.

2. Whether his subsequent acceptance of retirement benefits would estop him from pursuing
his complaint questioning the validity of his forced retirement.

HELD:

1. Under Republic Act No. 7641, the option to retire upon reaching the age of 60 years or
more but not beyond 65 is the exclusive prerogative of the employee when there is no provision
on retirement in a collective bargaining agreement or if the employer has no retirement plan. —It
is clear therefrom that in the absence of a collective bargaining agreement or company policy
providing for a retirement plan, the option to retire at age 60 could be exercised by either the
employee or the employer. This power of the employer no longer exists under R.A. No. 7641, which
unequivocally provides that the option to retire upon reaching the age of 60 years or more but not
beyond 65 is the exclusive prerogative of the employee if there is no provision on retirement in a
collective bargaining agreement or any other agreement or if the employer has no retirement plan.

2. YES. By his acceptance of retirement benefits, petitioner is deemed to have opted to retire
under the third paragraph of Article 287 of the Labor Code, as amended by R.A. No. 7641. —By his
acceptance of retirement benefits the petitioner is deemed to have opted to retire under the third
paragraph of Article 287 of the Labor Code, as amended by R.A. No. 7641. Thereunder he could
choose to retire upon reaching the age of 60 years, provided it is before reaching 65 years, which
is the compulsory age of retirement.

54. Progressive Development Corporation (PDC) vs. NLRC

344 SCRA 512 | October 30, 2000

FACTS: PDC implemented its Employees’ Non-Contributory Retirement Plan (The Plan) which took
effect on 1 April 1980. Thereafter, a number of employees was retired pursuant to the optional
retirement provision (Section 3) of The Plan—On 8 October 1990, upon request by PDC, Director
Sanchez of the Bureau of Working Conditions, DOLE, confirmed the validity of The Plan,
particularly its provision on optional retirement. On 28 November 1994 PDC notified its employees
who had rendered more than twenty (20) years of service in the Company of its decision to retire
them. Thus, Riego and Andres, two (2) of those who were retired, filed a complaint for illegal
retirement and unfair labor practices PDC.

The two (2) cases were consolidated. During the pendency of these cases, Riego desisted from
pursuing his claim and accepted his retirement benefits. In addition, he executed a Release and
Quitclaim that effectively relieved PDC and Andres was Chairman of the Board of Directors of
PDW-LIKHA, a union of rank-and-file employees of PDC, while Romano was a member of the
union. They contended that their retirement from PDC was done by the latter as a retaliatory
measure for their union activities. They assailed the validity of The Plan under which they were
retired claiming lack of knowledge thereof absent any CBA and any applicable employment
contract.
ISSUE: Whether private respondents were illegally retired rests upon the determination of whether
the retirement program of petitioner company is valid.

HELD: YES. The retirement of an employee effected pursuant to a retirement plan which forms
part of employment contract of his employer is valid. Accordingly, a careful examination of the
records shows that the findings of the Labor Arbiter are more in harmony with the evidence on
record. The retirement plan under which private respondents were retired is valid for it forms part
of the employment contract of petitioner company. Director Sanchez of the BWC-DOLE recognized
and affirmed the validity of The Plan. Thus—Considering therefore the fact that your client’s
retirement plan now forms part of the employment contract since it is made known to the
employees and accepted by them, and such plan has an express provision that the company has
the choice to retire an employee regardless of age, with twenty (20) years of service, said policy
is within the bounds contemplated by the Labor Code. Moreover, the manner of computation of
retirement benefits depends on the stipulation provided in the company retirement plan.

55. METRO TRANSIT ORGANIZATION, INC. VS. NLRC

284 SCRA 308 | January 16, 1998

FACTS: Garcia started working with petitioner Metro Transit Organization (METRO) as a station
teller in 1984. In 1992 he called up the office of METRO and asked his immediate supervisor if he
could go on leave of absence as he was proceeding to Cebu to look for his wife and children who
suddenly left home without his knowledge. After a few weeks of fruitless search he returned to
Manila. When he reported to the office, Garcia was not allowed to resume work but was directed
by his section head, to proceed to the legal department of METRO where he would undergo
investigation. There he was asked by one Noel Pili about his absence from work. After he
explained to Pili his predicament, Pili cut short the inquiry and informed him right away that it
would be better for him to resign rather than be terminated for his absences. Still in a state of
extreme agitation and weighed down by a serious family problem, Garcia at once prepared a
resignation letter. Then he left again for the province to look for his family. But like his first attempt
his effort came to naught. Soon after, or on 4 June 1992, the Personnel Committee of METRO
approved his resignation. Meanwhile, Garcia sought advice from the president of his labor union
and asked that the union intervene in his case by bringing the matter of his forced resignation
before their grievance machinery for arbitration. METRO paid no heed to the problem and rejected
Garcia’s plea that he be not considered resigned from his employment. Thus on 15 December
1992 Garcia filed a complaint for illegal dismissal.

ISSUE: Whether Garcia was forced to resign thus was illegally dismissed.
HELD: YES. There is no valid resignation where it was made without proper discernment, such as
when an employee’s writing and handing in of his resignation letter to his employer were a knee -
jerk reaction triggered by that singular moment when he was left with no alternative but to accede,
having been literally forced into it by being presented with the more unpleasant fate of being
terminated.—An examination of the circumstances surrounding the submission of the letter
indicates that the resignation was made without proper discernment so that it could not have
been intelligently and voluntarily done. During his encounter with Pili, respondent Garcia asked,
“x x x ano ba ang gagawin ko kasi aalis uli ako, kailangan kong ayusin ang problema ko x x x sabi
n’ya mag-resign ka na lang para hindi ka na ma-terminate.”

Verily, what Pili did as petitioner’s representative was to advise Garcia, who at that time was
thoroughly confused and bothered no end by a serious family problem, that he had better resign
or face the prospect of an unceremonious termination from service for abandonment of work. At
that precise moment, the employee could not be said to have fully understood what he was doing,
i.e., writing his resignation letter, nor could have foreseen the consequences thereof, for it is
established that as soon as he came out of the investigation office he prepared his resignation
letter right then and there at a table nearby with no time for reflection.

56. PHILIPPINES TODAY, INC. VS. NLRC

267 SCRA 202 | January 30, 1997

FACTS: Philippines Today, Inc. (PTI) is the owner of the Philippine Star, a daily newspaper of
national and international circulation, while Alegre, Jr. was employed by PTI as a senior
investigative reporter of the Philippine Star. He later became chief investigative writer and then
assistant to the publisher.

Alegre filed a request for a thirty-day leave of absence citing the advice of his personal physician
for him to undergo further medical consultations abroad. Four days later, he wrote a
“Memorandum for File" addressed to Belmonte (Treasurer) with copies furnished to members of
the board of directors of PTI. The following day, Alegre wrote Belmonte expressing surprise over
the acceptance of his “resignation” and that he never resigned. He accused petitioners of illegal
dismissal as can be perceived allegedly from the discrimination against him in promotions,
benefits and the ploy to oust him by considering his memorandum as a resignation. Counsel for
petitioners explained that the acceptance of Alegre’s resignation was a Collective decision of the
board of directors since “nobody in his right mind would write a memorandum of the sort he wrote
and still not resign.

ISSUE: Did the Memorandum for File Constitute Voluntary Resignation?

HELD:YES. Seeking relief is incompatible with writing an offensive letter—for all intents and
purposes, such letter wittingly or unwittingly shows an intent to end employment relations. —Any
management officer, much so an immediate superior, would be offended, if not enraged, with the
insults and innuendoes stated in said memorandum; more so because the memorandum was not
directly addressed to him but to the chairman and CEO and copy furnished all other officers and
members of the board of directors. Any discerning mind can perceive that the letter is not simply
a recitation of respondent Alegre’s gripes, disappointments, frustrations and heartaches against
the company and its officers particularly Petitioner Soliven, as postulated by the Solicitor General
in his comment. If it were so, why was it not addressed directly to the person concerned?

His memorandum clearly indicated that his problems involved, or were supposedly caused by only
one person, Mr. Soliven, his immediate superior. But it was not even addressed to him! How can
he expect amends in their relations if that was all he wanted? The Solicitor General was simply
turning a blind eye to the obvious fact that said memorandum, for all intents and purposes, was
intended, wittingly or unwittingly, to end employment relations.