Petitioner Lopez is the truck driver of the respondent. He was given a notice to the effect that he would be terminated by the respondent on the ground that he was caught by the security guard stealing scrap irons by smuggling them out from the company premises. Later on, the respondent filed a criminal case of qualified theft against the respondent. Petitioner then filed an illegal dismissal case against the respondent on the ground that he was dismissed by the respondent without just cause and that he was not afforded due process as he was not given a counsel and an opportunity to confront witnesses. As the case was appealed, the NLRC ruled that there was a violation of due process in dismissing the petitioner as he was not afforded ample opportunity to refute the allegations lodged against him. Furthermore, petitioner advanced that there was no sufficient cause to terminate him as such ground was only a mere subterfuge of the respondent so as for him not to lodge a complaint of underpayment of wages.
Issue:
Whether or not the dismissal is illegal Ruling:
No, the dismissal is not illegal.
Dismissals have two facets: the legality of the act of dismissal, which constitutes substantive due process, and the legality of the manner of dismissal which constitutes procedural due process. As to substantive due process, the Court finds that respondent company‘s loss of trust and confidence arising from petitioner‘s smuggling out of the scrap iron, conpounded by his past acts of unauthorized selling cartons belonging to respondent company, constituted just cause for terminating his services.
Loss of trust and confidence as a ground for dismissal of employees covers employees occupying a position of trust who are proven to have breached the trust and confidence reposed on them
The language of Article 282(c) of the Labor Code states that the loss of trust and confidence must be based on willful breach of the trust reposed in the employee by his employer. Such breach is willful if it is done intentionally, knowingly, and purposely, without justifiable excuse, as distinguished from an act done carelessly, thoughtlessly, heedlessly. And, in order to constitute a just cause for dismissal, the act complained of must be work-related and shows that the employee concerned is unfit to continue working for the employer. In addition, loss of confidence as a just cause for termination of employment is premised on the fact that the employee concerned holds a position of responsibility, trust and confidence or that the employee concerned is entrusted with confidence with respect to delicate matters, such as the handling or care and protection of the property and assets of the employer. The betrayal of this trust is the essence of the offense for which an employee is penalized.
It is, however, with respect to the appellate court‘s finding that petitioner was not afforded procedural due process that the Court deviates from.
Procedural due process has been defined as giving an opportunity to be heard before judgment is rendered.
The Court finds that it was error for the NLRC to opine that petitioner should have been afforded counsel or advised of the right to counsel. The
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right to counsel and the assistance of one in investigations involving termination cases is personally or with the assistance of a representative or counsel. He may also ask the employer to provide him copy of records material to his defense. His written explanation may also include a request that a formal hearing or conference be held. In such a case, the conduct of a formal hearing or conference becomes mandatory, just as it is where there exist substantial evidentiary disputes or where company rules or practice requires an actual hearing as part of employment pretermination procedure.
74. Apacible vs. Multimed Industries Inc., G.R. No. 178903, May 30, 2011 Facts:
Petitioner Juliet Apacible was hired sometime in 1994 by respondent. She rose from the ranks to become Assistant Area Sales Manager for Cebu Operations, the position she held at the time she was separated from the service in 2003.
On August 4, 2003, petitioner was informed by respondent Marlene Orozco (Marlene), her immediate superior, that she would be transferred to the company's main office in Pasig City on account of the ongoing reorganization. Petitioner requested that her transfer be made effective in October or November 2003 and that she be given time to discuss it with her husband and daughter.
A week later, however, or on August 11, 2003, petitioner was informed that her transfer would be effective August 18, 2003. On even date, she was placed under investigation for the delayed released of BCRs (cash budget for customer representation in sealed envelopes which are given to loyal clients) which she received for distribution earlier in July 2003.
Finding that the delay in releasing the BCRs amounted to loss of trust and confidence, petitioner claims that in a meeting with the respondents, she was given four options: resignation, termination, availment of an early retirement package worth P40,000, or transfer to Pasig City. Without availing of any option, petitioner took a leave of absence on August 28, 29 and September 1, 2003.
On September 3, 2003, respondent company sent petitioner a memorandum-directive for her to immediately report to the head office in Pasig City and to return the company vehicle assigned to her to the Cebu Office within 24 hours. Petitioner did not heed the directive, however. She instead filed an application for sick leave until September 11, 2003, and another until September 27, 2003.
On October 6, 2003, petitioner requested that she be given her daily work assignment in Cebu, which request was later to be denied by Olga by letter dated October 8, 2003. On October 7, 2003, petitioner was given a show cause notice for her to explain in writing why she should not be sanctioned for insubordination for failure to comply with the transfer order.
On November 4, 2002, respondent company sent petitioner a notice of termination effective November 7, 2003 for insubordination, prompting petitioner to file a complaint for illegal dismissal, non-payment of overtime pay, 13th month pay, service incentive leave pay, separation pay, damages and attorney's fees before the Labor Arbiter.
The Court of Appeals ruled that petitioner was not entitled to separation pay because, contrary to the NLRC's finding, she "lacked good faith." It noted that petitioner, from the start, knew and accepted the company policy on transfers whenever so required, and could not thus refuse
"another valid reassignment by treating it as an imposition and burden."
ISSUE:
Whether petitioner is entitled separation pay by way of financial assistance.
RULING:
NO. Reno Foods, Inc. v. Nagkakaisang Lakas ng Manggagawa (NLM)-Katipunan 16 explains the propriety of granting separation pay in termination cases in this wise:
The law is clear. Separation pay is only warranted when the cause for termination is not attributable to the employee's fault, such as those provided in Articles 283 and 284 of the Labor Code, as well as in cases of illegal dismissal in which reinstatement is no longer feasible. It is not allowed when an employee is dismissed for just cause, such as serious misconduct.
xxx xxx xxx
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It is true that there have been instances when the Court awarded financial assistance to employees who were terminated for just causes, on grounds of equity and social justice. The same, however, has been curbed and rationalized in Philippine Long Distance Telephone Company v.
National Labor Relations Commission. In that case, we recognized the harsh realities faced by employees that forced them, despite their good intentions, to violate company policies, for which the employer can rightly terminate their employment. For these instances, the award of financial assistance was allowed. But, in clear and unmistakable language, we also held that the award of financial assistance shall not be given to validly terminated employees, whose offenses are iniquitous or reflective of some depravity in their moral character. When the employee commits an act of dishonesty, depravity, or iniquity, the grant of financial assistance is misplaced compassion. It is tantamount not only to condoning a patently illegal or dishonest act, but an endorsement thereof. It will be an insult to all the laborers who despite their economic difficulties, strive to maintain good values and moral conduct.
In fact, in the recent case of Toyota Motors Philippines, Corp. Workers Association (TMPCWA) v. National Labor Relations Commission, we ruled that separation pay shall not be granted to all employees who are dismissed on any of the four grounds provided in Article 282 of the Labor Code. Such ruling was reiterated and further explained in Central Philippines Bandag Retreaders, Inc. v. Diasnes:
To reiterate our ruling in Toyota, labor adjudicatory officials and the CA must demur the award of separation pay based on social justice when an employee's dismissal is based on serious misconduct or wilful disobedience; gross and habitual neglect of duty; fraud or wilful breach of trust; or commission of a crime against the person of the employer or his immediate family — grounds under Art. 282 of the Labor Code that sanction dismissals of employees. They must be most judicious and circumspect in awarding separation pay or financial assistance as the constitutional policy to provide full protection to labor is not meant to be an instrument to oppress the employers. The commitment of the Court to the cause of labor should not embarrass us from sustaining the employers when they are right, as assistance to the undeserving and those who are unworthy of the liberality of the law. (italics in the original, emphasis and underscoring supplied) ASTIED
Petitioner was, it bears reiteration, dismissed for wilfully disobeying the lawful order of her employer to transfer from Cebu to Pasig City. As correctly noted by the appellate court, petitioner knew and accepted respondent company's policy on transfers when she was hired and was in fact even transferred many times from one area of operations to another — Bacolod City, Iloilo City and Cebu.
Clearly, petitioner's adamant refusal to transfer, coupled with her failure to heed the order for her return the company vehicle assigned to her and, more importantly, allowing her counsel to write letters couched in harsh language to her superiors unquestionably show that she was guilty of insubordination, hence, not entitled to the award of separation pay.
75. Barroga vs. Data Center College, G.R. No. 174158, June 27, 2011 Facts:
On November 11, 1991, petitioner was employed as an Instructor in Data Center College Laoag City branch in Ilocos Norte. In a Memorandum dated June 6, 1992, respondents transferred him to University of Northern Philippines (UNP) in Vigan, Ilocos Sur where the school had a tie-up program. Petitioner was informed through a letter dated June 6, 1992 that he would be receiving, in addition to his monthly salary, a P1,200.00 allowance for board and lodging during his stint as instructor in UNP-Vigan. In 1994, he was recalled to Laoag campus. On October 3, 2003, petitioner received a Memorandum transferring him to Data Center College Bangued, Abra branch as Head for Education/Instructor due to an urgent need for an experienced officer and computer instructor thereat.
However, petitioner declined to accept his transfer to Abra citing the deteriorating health condition of his father and the absence of additional remuneration to defray expenses for board and lodging which constitutes implicit diminution of his salary.
On November 10, 2003, petitioner filed a Complaint for constructive dismissal against respondents. Petitioner alleged that his proposed transfer to Abra constitutes a demotion in rank and diminution in pay and would cause personal inconvenience and hardship.
For their part, respondents claimed that they were merely exercising their management prerogative to transfer employees for the purpose of advancing the school‘s interests. They argued that petitioner‘s refusal to be transferred to Abra constitutes insubordination.
Ruling:
Petitioner‘s transfer is not tantamount to constructive dismissal.
Petitioner was originally appointed as instructor in 1991 and was given additional administrative functions as Head for Education during his stint in Laoag branch. He did not deny having been designated as Head for Education in a temporary capacity for which he cannot invoke any tenurial security. Hence, being temporary in character, such designation is terminable at the pleasure of respondents who made such appointment.
Moreover, respondents‘ right to transfer petitioner rests not only on contractual stipulation but also on jurisprudential authorities. The Labor Arbiter and the NLRC both relied on the condition laid down in petitioner‘s employment contract that respondents have the prerogative to assign
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petitioner in any of its branches or tie-up schools as the necessity demands. In any event, it is management prerogative for employers to transfer employees on just and valid grounds such as genuine business necessity. It is also important to stress at this point that respondents have shown that it was experiencing some financial constraints. Because of this, respondents opted to temporarily suspend the post-graduate studies of petitioner and some other employees who were given scholarship grants in order to prioritize more important expenditures.
76. Lopez vs. Keppel Bank Phils., G.R. No. 176800, September 5, 2011 Facts:
Petitioner Elmer Lopez was the Branch Manager of the respondent Keppel Bank Philippines, Inc. (bank) in Iloilo City. Allegedly, through his efforts, Hertz Exclusive Cars, Inc. (Hertz) became a client of the bank.
By a notice, the bank asked Lopez to explain in writing why he should not be disciplined for issuing, without authority, two purchase orders (POs) for the Hertz account amounting to a total of P6,493,000.00, representing the purchase price of 13 Suzuki Bravo and two Nissan Exalta vehicles. Lopez submitted his written explanation on the same day, but the bank refused to give it credit. Through respondents Manuel Bosano III President and Head of Retail Banking Division/Consumer Banking Division) and Stefan Tong Wai Mun (Vice-President/Comptroller), the bank terminated Lopez‘s employment effective immediately.
Lopez filed a complaint for illegal dismissal and money claims against the bank, Bosano and Tong. Lopez alleged before the labor arbiter that he issued the POs as part of his strategy to enhance the bank's business, in line with his duty as branch manager to promote the growth of the bank. For its part, the bank denied approving the first PO, arguing that Lopez did not have the authority to issue the POs for the Hertz account as there was a standing advice that no Hertz loan application was to be approved. It stressed that Lopez committed a serious violation of company rules when he issued the POs.
Issue:
Whether or not petitioner was illegally dismissed Held:
The right of an employer to freely select or discharge his employee is a recognized prerogative of management; an employer cannot be compelled to continue employing one who has been guilty of acts inimical to its interests. When this happens, the employer can dismiss the employee for loss of confidence.
At the same time, loss of confidence as a just cause of dismissal was never intended to provide employers with a blank check for terminating employment. Loss of confidence should ideally apply only (1) to cases involving employees occupying positions of trust and confidence, or (2) to situations where the employee is routinely charged with the care and custody of the employer's money or property. To the first class belong managerial employees, i.e., those vested with the powers and prerogatives to lay down management polices and/or to hire, transfer, suspend, lay-off, recall, discharge, assign or discipline employees, or effectively recommend such managerial actions. To the second class belong cashiers, auditors, property custodians, or those who, in the normal and routine exercise of their functions, regularly handle significant amounts of money or property.
As branch manager, Lopez clearly occupies a "position of trust." His hold on his position and his stay in the service depend on the employer's trust and confidence in him and on his managerial services. According to the bank, Lopez betrayed this trust and confidence when he issued the subject POs without authority and despite the express directive to put the client's application on hold. In response, Lopez insists that he had sufficient authority to act as he did, as this authority is inherent in his position as bank manager. He points to his record in the past when he issued POs which were honored and paid by the bank and which constituted the arbiter's "overwhelming evidence" in support of the finding that
"complainant's dismissal from work was without just cause, hence, illegal."
As a bank official, the petitioner must have been aware that it is basic in every sound management that people under one's supervision and direction are bound to follow instructions or to inform their superior of what is going on in their respective areas of concern, especially regarding matters of vital interest to the enterprise. Under these facts, we find it undisputed that Lopez disobeyed the bank's directive to put the Hertz loan application on hold, and did not wait until its negative credit rating was cleared before proceeding to act. That he might have been proven right is immaterial. Neither does the submission that the bank honored and paid the first PO and even realized a profit from the transaction, mitigate the gravity of Lopez's defiance of the directive of higher authority on a business judgment. What appears clear is that the bank cannot in the future trust the petitioner as a manager who would follow directives from higher authorities on business policy and directions. The bank can be placed at risk if this kind of managerial attitude will be repeated, especially if it becomes an accepted rule among lower managers.
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Under the circumstances of this case, we are convinced that the bank was justified in terminating Lopez's employment by reason of loss of trust and confidence. He admitted issuing the two POs, claiming merely that he had the requisite authority. He could not present any proof in this regard, however, except to say that it was part of his inherent duty as bank manager. He also claimed that the bank acquiesced to the issuance of the POs as it paid the first PO and the POs he issued in the past. This submission flies in the face of the bank's directive for him not to proceed unless matters are cleared with the bank's credit committee. The bank had a genuine concern over the issue as it found through its credit committee that Hertz was a credit risk. Whether the credit committee was correct or not is immaterial as the bank's direct order left Lopez without any authority to clear the loan application on his own. After this defiance, we cannot blame the bank for losing its confidence in Lopez and in separating him from the service.
77. St. Paul College Quezon City vs. Ancheta II, G.R. No. 169905, September 7, 2011 Facts:
Respondent Remigio Michael Ancheta II and his wife, respondent Cynthia was hired by the same school as a part time teacher of the Mass
Respondent Remigio Michael Ancheta II and his wife, respondent Cynthia was hired by the same school as a part time teacher of the Mass