PHILIPPINE EDUCATION CO., INC.

, petitioner,
vs.
UNION OF PHILIPPINE EDUCATION EMPLOYEES (NLU) and THE COURT OF
INDUSTRIAL RELATIONS, respondents
G.R. No. L-13778
April 29, 1960

Facts: Ernesto Carpio and other employees of the company (members of union)
joined a strike. After the labor dispute was settled, the Industrial Court ordered the
reinstatement of the strikers including Carpio. However, the company refused to
reinstate Carpio for the reason that a criminal complaint of theft was filed against
him. Municipal Trial Court convicted him but Court of First Instance acquitted him on
the ground of reasonable doubt.
The question of reinstatement was heard by the Industrial Court. IC agreed with the
finding of the CFI and held that Carpios acquittal entitled him to reinstatement
though without backpay.
But the Supreme Court, after the examination of evidence, agreed with the MTC that
Carpios guilt had been duly established at least the preponderance was against his
innocence.

Issue: Whether the acquittal of an employer, especially on the ground of reasonable

doubt, in a criminal case involving articles and merchandise belonging to his
employer entitles the said employee reinstatement?

Held: The relation between employer and employee necessarily involve trust and
confidence. And when the employer lost confidence to its employee, it would be
unfair to the employer to oblige the continuance of the employment of the said
employee or to reinstate him. And in the present case, Carpio was dismissed not
because of his union affiliation or activity. Although he was acquitted on reasonable
doubt by the CFI, the company has ample reason to distrust him. And under such
circumstance, the court cannot require the company to reemploy or reinstate him.
Ruling: The appealed orders of Court of First Instance were reversed.