July 2010 Philippine Supreme Court Decisions on Labor Law and Procedure

Posted on August 12, 2011 by Leslie C. Dy Here are selected July 2010 rulings of the Su re!e Court of the Phili ines on labor la" and rocedure# Labor relations$ in pari delicto rule in illegal stri%es or loc%outs . &hen !anage!ent and union are in pari delicto, the contending arties !ust be brought bac% to their res ecti'e ositions before the contro'ersy$ that is, before the stri%e. (n this case, !anage!ent)s fault arose fro! the fact that a day after the union filed a etition for certification election before the D*L+, it hit bac% by re,uiring all its e! loyees to undergo a co! ulsory drug test. (ndeed, the ti!ing of the drug test "as sus icious. -oreo'er, !anage!ent engaged in a runa"ay sho "hen it began ulling out !achines fro! the !ain building .A+/ building0 to the co! ound .A+/1PSC re!ises0 located on another street on the rete2t that the !ain building "as undergoing reno'ation. *n the other hand, li%e !anage!ent, the union and the affected "or%ers "ere also at fault for resorting to a concerted "or% slo"do"n and "al%ing out of their 3obs in rotest of their illegal sus ension. (t "as also "rong for the! to ha'e forced their "ay to the A+/1PSC re!ises to try to bring out the boring !achines. Adding to the in3ury "as the fact that the ic%eting e! loyees re'ented the entry and e2it of non1 artici ating e! loyees and ossibly A+/)s clients to the re!ises. 4hus, the Su re!e Court affir!ed the ruling of the Court of A eals fa'oring the reinstate!ent of all the co! laining e! loyees, including those "ho tested ositi'e for illegal drugs, "ithout bac%"ages. Automotive Engine Rebuilders, Inc. et al. v. Progresibong Unyon ng mga Manggagawa sa AER, et al./Progresibong Unyon ng mga Manggagawa sa AER, et al. v. Automotive Engine Rebuilders, Inc., et al., G.R. o. !"#!$%/G.R. o. !"#!&'. (uly !$, '#!!. +! loyee dis!issal$ reorgani5ation. /esignation is the 'oluntary act of an e! loyee "ho is in a situation "here he belie'es that ersonal reasons cannot be sacrificed in fa'or of the e2igency of the ser'ice, and he has then no other choice but to disassociate hi!self fro! e! loy!ent. 4he intent to relin,uish !ust concur "ith the o'ert act of relin,uish!ent$ hence, the acts of the e! loyee before and after the alleged resignation !ust be considered in deter!ining "hether he, in fact, intended to ter!inate his e! loy!ent. (n this case, the ele!ent of 'oluntariness "as lac%ing. San -iguel Pro erties Phili ines, (nc. .S-P(0 clai!s that there "as an e2isting reorgani5ation lan in 1667 and that it "as i! le!ented shortly after the effecti'e date of 8ucaban)s resignation. &hile a reorgani5ation of S-P()s cor orate structure !ight ha'e indeed ta%en lace, it ha ened !ore than a year after 8ucaban)s se aration fro! the co! any and incidentally, after she filed the co! laint. And although the co! any !ight ha'e been suffering fro! losses due to !ar%et decline as alleged, there "as still no concrete lan for a cor orate reorgani5ation at the ti!e 8on5ale5 resented to 8ucaban the see!ingly last a'ailable alternati'e o tions of 'oluntary resignation and ter!ination by abolition of her office. (n other "ords, 8ucaban)s se aration fro! the co! any "as the confluence of the fraudulent re resentation to her that her office "ould be declared redundant, cou led "ith the subse,uent alienation "hich she suffered fro! the co! any by reason of her refusal to tender resignation. 4he ele!ent of 'oluntariness in her resignation is, therefore, !issing. )an Miguel Properties P*ilippines, Inc. vs. Gwendellyn Rose Gucaban, G.R. o. !+$&%'. (uly !%, '#!!.

9actual 9indings of the CA and :L/C. 4he Su re!e Court, as a rule, is bound by the factual findings of the Court of A eals, but has the discretion to ree2a!ine the e'idence in a case "hen a basic conflict e2ists bet"een the CA)s findings of fact and those of the :L/C. (n this case, such a conflict e2isted and the SC had to deter!ine "hether ;arit had been under aid and<or "as not aid her "ages during her e! loy!ent in Saudi Arabia. 4he SC found that ;arit "as fully aid her "ages during her e! loy!ent in Saudi Arabia. :o"here in the records did it a ear that ;arit co! lained about the alleged under ay!ent and non1 ay!ent of her "ages "ith the Phili ine labor or consular re resentati'es in Saudi Arabia, or e'en "ith the Saudi authorities the!sel'es. :either "as there any sho"ing that she e'er ob3ected to or rotested her ini,uitous "or% situation directly "ith the foreign rinci al, Ha!eed, if that had really been the case, nor that ;arit identified or s o%e of any roble! that could ha'e re'ented her fro! see%ing relief in Saudi Arabia. 4o !a%e the agency liable for ;arit)s alleged un aid and under aid "ages on the sole ground that it failed to sub!it co ies of aysli s and ayrolls is unfair, as the agency a eared to ha'e ta%en all a'ailable !eans to secure the necessary docu!ents fro! ;arit)s e! loyer to dis ute her clai!s. (ones International Manpower )ervices, Inc., represented by its President, Edward G. ,ue vs. -ella Agcaoili.-arit, G.R. o. !%!&!&. (uly '#, '#!!. Co! ensable death. 4o be considered as a co! ensable death under the 8S(S la", the in3ury !ust be the result of an e! loy!ent accident satisfying all of the follo"ing# 10 the e! loyee !ust ha'e been in3ured at the lace "here his "or% re,uires hi! to be$ 20 the e! loyee !ust ha'e been erfor!ing his official functions$ and =0 if the in3ury is sustained else"here, the e! loyee !ust ha'e been e2ecuting an order for the e! loyer. 4he re,uire!ent that the in3ury !ust arise out of and in the course of e! loy!ent roceeds fro! the li!iting re!ise that the in3ury !ust be the result of an accident. An accident e2cludes that "hich ha ens "ith intention or design, "ith one)s foresight or e2 ectation or that "hich under the circu!stances is e2 ected by the erson to "ho! it ha ens. (n this case, the Su re!e Court found that the death of Sgt. Angel did not result fro! an accident "hich is co! ensable under Presidential Decree :o. >2>. (t "as, on the contrary, occasioned by an intentional or designed act "hich re!o'es the resulting death fro! the co'erage of the State (nsurance 9und. 4he circu!stances of Sgt. Angel)s death ? his lifeless body "as found hanging inside his cell "ith an electric cord tied around his nec% @ ta%en together "ith the unrebutted finding that there is no e'idence of foul lay ? negate res ondent)s clai! of !urder of her husband and of the co! ensability of such death. Government )ervice Insurance )ystem vs. (um Angel, G.R. o. !""%"$. (uly '#, '#!!. +! loyee dis!issal$ e'idence. Substantial e'idence !eans such rele'ant e'idence as a reasonable !ind !ight acce t as ade,uate to su ort a conclusion, e'en if other !inds, e,ually reasonable, !ight concei'ably o ine other"ise. (n this case, it "as found that the agency succeeded in sho"ing by substantial e'idence that its rinci al, Panstar, had a 'alid reason for ter!inating 9lores) e! loy!ent. Ca t. ;.H. -un, decided to dis!iss 9lores .the shi )s -aster0 not only for agitating the cre" to rebel against the authorities of the 'essel M// Morning ,*arm, but for se'eral other infractions. As the records sho"ed, and as Ca t. ;.H. -un stressed in his letter of :o'e!ber 1A, 166A to the agency !anage!ent, 9lores "as also charged "ith inefficiency or neglect of duty, insubordination, insolent and disres ectful beha'ior, and other actuations "hich !ade hi! unfit for his osition and ran%. Abosta )*ipmanagement ,orporation vs. ational 0abor Relations ,ommission 12irst 3ivision4 and Arnul5o R. 2lores, G.R. o. !"$'+'. (uly '6, '#!!. 8rounds for Dis!issal. An e! loyee)s ro ensity to co!!it re etitious infractions e'inces "rongful intent, !a%ing hi! undeser'ing of the co! assion accorded by la" to labor$ thus, dis!issal of said e! loyee "ould be 3ustified. (n this case, as etitioner)s e! loy!ent record

sho"ed, it "as not the first ti!e that he refused to collect fares fro! assengers. (n fact, it "as already the third instance that he failed to collect fares fro! the riding ublic. His re eated 'iolation of the co! any)s olicies and rules sho"ed his "ant of care for the e! loyer)s olicies. And although etitioner already suffered the corres onding enalties for his ast !isconduct, those infractions "ere still found to be rele'ant and !ay be considered in assessing his liability for his resent infraction. (erry Mapili vs.. P*ilippine Rabbit -us 0ines, Inc., G.R. o. !6'+#". (uly '6, '#!!.

August 2011 Philippine Supreme Court Decisions on Labor Law and Procedure
Posted on Se te!ber 1B, 2011 by Leslie C. Dy Here are selected August 2011 rulings of the Su re!e Court of the Phili ines on labor la" and rocedure# Labor relations$ a ro riate bargaining unit. An a ro riate bargaining unit is defined as Ca grou of e! loyees of a gi'en e! loyer, co! rised of all or less than all of the entire body of e! loyees, "hich the collecti'e interest of all the e! loyees, consistent "ith e,uity to the e! loyer, indicate to be best suited to ser'e the reci rocal rights and duties of the arties under the collecti'e bargaining ro'isions of the la"D. 4he test of grou ing is co!!unity or !utuality of interest. (n this case, there should be only one bargaining unit for the e! loyees in the Cabuyao, San 9ernando, and *tis lants of the -agnolia Poultry Products in'ol'ed in CdressedD chic%en rocessing and -agnolia Poultry 9ar!s engaged in Cli'eD chic%en o erations. Certain factors, such as s ecific line of "or%, "or%ing conditions, location of "or%, !ode of co! ensation, and other rele'ant conditions do not affect or i! ede their co!!onality of interest. Although they see! se arate and distinct fro! each other, the s ecific tas%s of each di'ision are actually interrelated and there e2ists !utuality of interests "hich "arrants the for!ation of a single bargaining unit. )an Miguel 2oods, Inc. vs. )an Miguel ,orp. )upervisors and E7empt Union, G.R. o. !8"'#". August !, '#!!. Labor organi5ation$ confidential e! loyees. Confidential e! loyees are defined as those "ho .10 assist or act in a confidential ca acity, in regard .20 to ersons "ho for!ulate, deter!ine, and effectuate !anage!ent olicies in the field of labor relations. 4he t"o criteria are cu!ulati'e, and both !ust be !et if an e! loyee is to be considered a confidential e! loyee. Confidential e! loyees, such as accounting ersonnel, should be e2cluded fro! the bargaining unit, as their access to confidential infor!ation !ay beco!e the source of undue ad'antage. Ho"e'er, such fact does not a ly to the osition of Payroll -aster .as in this case0 and the "hole ga!ut of e! loyees "ho has access to salary and co! ensation data. 4he CA correctly held that the osition of Payroll Master does not in'ol'e dealing "ith confidential labor relations infor!ation in the course of the erfor!ance of his functions. (n other "ords, since the nature of his "or% does not ertain to co! any rules and regulations and confidential labor relations, it follo"s that he cannot be e2cluded fro! the sub3ect bargaining unit. )an Miguel 2oods, Inc. vs. )an Miguel ,orp. )upervisors and E7empt Union, G.R. o. !8"'#". August !, '#!!.

Labor organi5ation$ ineligibility to 3oin. Although Article 2EB of the Labor Code li!its the ineligibility to 3oin, for! and assist any labor organi5ation to !anagerial e! loyees, 3uris rudence has e2tended this rohibition to confidential e! loyees. (n this regard, the CA correctly ruled that the ositions of Hu!an /esource Assistant and Personnel Assistant belong to the category of confidential e! loyees and, hence, are e2cluded fro! the bargaining unit, considering their res ecti'e ositions and 3ob descri tions. As Hu!an /esource Assistant, the sco e of one)s "or% necessarily in'ol'es labor relations, recruit!ent and selection of e! loyees, access to e! loyees) ersonal files and co! ensation ac%age, and hu!an resource !anage!ent. As regards a Personnel Assistant, one)s "or% includes the recording of !inutes for !anage!ent during collecti'e bargaining negotiations, assistance to !anage!ent during grie'ance !eetings and ad!inistrati'e in'estigations, and securing legal ad'ice for labor issues fro! the etitioner)s tea! of la"yers, and i! le!entation of co! any rogra!s. 4herefore, in the discharge of their functions, both gain access to 'ital labor relations infor!ation "hich outrightly dis,ualifies the! fro! union !e!bershi . )an Miguel 2oods, Inc. vs. )an Miguel ,orp. )upervisors and E7empt Union, G.R. o. !8"'#". August !, '#!!. Certification election$ role of e! loyers. 4he general rule is that an e! loyer has no standing to ,uestion the rocess of certification election, since this is the sole concern of the "or%ers. La" and olicy de!and that e! loyers ta%e a strict, hands1off stance in certification elections. 4he bargaining re resentati'e of e! loyees should be chosen free fro! any e2traneous influence of !anage!ent. 4he only e2ce tion is "here the e! loyer itself has to file the etition ursuant to Article 2B7 of the Labor Code because of a re,uest to bargain collecti'ely. )an Miguel 2oods, Inc. vs. )an Miguel ,orp. )upervisors and E7empt Union, G.R. o. !8"'#". August !, '#!!. A eal of the decision of the labor arbiter$ osting of bond. 4he osting of a bond is indis ensable to the erfection of an a eal in cases in'ol'ing !onetary a"ards fro! the Decision of the Labor Arbiter. Ho"e'er, the Su re!e Court, considering the substantial !erits of the case, has on certain occasions rela2ed this rule on, and e2cused the late osting of, the a eal bond "hen there are strong and co! elling reasons for the liberality. (n this case, the e2ce tion a lies. 4he rule on the osting of an a eal bond cannot defeat the substanti'e rights of res ondents to be free fro! an un"arranted burden of ans"ering for an illegal dis!issal for "hich they "ere ne'er res onsible since no e! loyer1e! loyee relationshi e2isted bet"een the t"o. Marticio )emblante and 3ubric9 Pilar vs. ,ourt o5 Appeals, G.R. o. !&"8'". August !+, '#!!. +! loyer1e! loyee relationshi $ four1fold test. Petitioners are not e! loyees of res ondents, since their relationshi failed to ass the four1fold test of e! loy!ent# .10 the selection and engage!ent of the e! loyee$ .20 the ay!ent of "ages$ .=0 the o"er of dis!issal$ and .E0 the o"er to control the e! loyee)s conduct, "hich is the !ost i! ortant ele!ent. As found by both the :L/C and the CA, res ondents had no art in etitioners) selection and !anage!ent$ etitioners) co! ensation "as aid out of the arriba ."hich is a ercentage deducted fro! the total bets0, not by etitioners$ and etitioners erfor!ed their functions as masiador and sentenciador free fro! the direction and control of res ondents. Marticio )emblante and 3ubric9 Pilar vs. ,ourt o5 Appeals, G.R. o. !&"8'". August !+, '#!!. Labor$ illegal recruit!ent in large scale. 4o ro'e illegal recruit!ent, it !ust be sho"n that a ellant ga'e co! lainants the distinct i! ression that she had the o"er or ability to send co! lainants abroad for "or% such that the latter "ere con'inced to art "ith their !oney in order to be e! loyed. All eight ri'ate co! lainants in this case consistently declared that *choa offered and ro!ised the! e! loy!ent o'erseas. -oreo'er, *choa can also be

con'icted for illegal recruit!ent based on Section > of /e ublic Act :o. 70E2, "hich clearly ro'ides that any erson, "hether or not a licensee or holder of authority !ay be held liable for illegal recruit!ent for certain acts as enu!erated in aragra hs .a0 to .!0. A!ong such acts is the Cfailure to rei!burse e2 enses incurred by the "or%er in connection "ith his docu!entation and rocessing for ur oses of de loy!ent, in cases "here the de loy!ent does not actually ta%e lace "ithout the "or%er)s fault.D (n this case, *choa recei'ed lace!ent and !edical fees fro! ri'ate co! lainants and failed to rei!burse the ri'ate co! lainants the a!ounts they had aid "hen they "ere not able to lea'e for 4ai"an and Saudi Arabia, through no fault of their o"n. People o5 t*e P*ilippines vs. Rosario :Rose; <c*oa, G.R. o. !6$6&'. August $!, '#!!. (llegal recruit!ent$ ad!issibility of P*+A certification. Section =>, /ule 1=0 of the /e'ised /ules on +'idence, states that a "itness can testify only to those facts "hich he %no"s of or co!es fro! his ersonal %no"ledge, that is, "hich are deri'ed fro! his erce tion. 4his is %no"n as the hearsay rule. 4he la", ho"e'er, ro'ides for s ecific e2ce tions to the hearsay rule, and one of the e2ce tions refers to entries in official records !ade in the erfor!ance of duty by a ublic officer. Accordingly, in the case at bar, although Dir. -ateo "as not resented in court or did not testify during the trial to 'erify the said certification, such certification is considered as prima 5acie e'idence of the facts stated therein and is therefore resu!ed to be truthful, because *choa did not resent any lausible roof to rebut its truthfulness. People o5 t*e P*ilippines vs. Rosario :Rose; <c*oa, G.R. o. !6$6&'. August $!, '#!!. (llegal recruit!ent and estafa$ !ay be charged se arately. A erson !ay be charged and con'icted se arately of illegal recruit!ent under /e ublic Act :o. 70E2, in relation to the Labor Code, and estafa under Article =1B, aragra h 2.a0 of the /e'ised Penal Code. 4he offense of illegal recruit!ent is malum pro*ibitum, "hile estafa is malum in se. (n this case, therefore, *choa !ay also be charged and corres ondingly held liable for estafa since all the ele!ents for the cri!e are resent in Cri!inal Case :os. 671AA=01, 671AA=02, and 671AA=0=. *choa)s deceit "as e'ident in her false re resentation to ri'ate co! lainants 8ubat, Cesar, and Agustin that she ossessed the authority and ca ability to send said ri'ate co! lainants to 4ai"an<Saudi Arabia for e! loy!ent as early as one to t"o "ee%s fro! co! letion of the re,uire!ents, a!ong "hich "ere the ay!ent of lace!ent fees and sub!ission of a !edical e2a!ination re ort. People o5 t*e P*ilippines vs. Rosario :Rose; <c*oa, G.R. o. !6$6&'. August $!, '#!!. 9loating status$ 'alidity. 4he rule is settled that Coff1detailingD is not e,ui'alent to dis!issal, so long as such status does not continue beyond a reasonable ti!e and that it is only "hen such a Cfloating statusD lasts for !ore than si2 !onths that the e! loyee !ay be considered to ha'e been constructi'ely dis!issed. A co! laint for illegal dis!issal filed rior to the la se of the si21 !onth eriod and<or the actual dis!issal of the e! loyee is generally considered as re!aturely filed. (n this case, the e'idence adduced a =uo clearly indicates that etitioners "ere not in bad faith "hen they laced Leynes under floating status. Disgruntled by :HP()s counter!anding of her decision to bar +ngr. Cantuba fro! the Pro3ect, Leynes t"ice signified her intention to resign fro! her osition on 12 9ebruary 2002. (n 'ie" of the sensiti'e nature of Leynes) osition and the critical stage of the Pro3ect)s business de'elo !ent, :HP( "as constrained to hire +ngr. Jose as Leynes) re lace!ent as a re!edial !easure. ippon >ousing P*il. Inc., et al. vs. Maia* Angela 0eynes, G.R. o. !66%!", August $, '#!!. Constructi'e dis!issal$ burden of roof. Constructi'e dis!issal e2ists "here there is cessation of "or% because continued e! loy!ent is rendered i! ossible, unreasonable or unli%ely, as an offer in'ol'ing a de!otion in ran% and a di!inution in ay. (n constructi'e dis!issal cases, the e! loyer is, concededly, charged "ith the burden of ro'ing that its conduct and action or the

transfer of an e! loyee are for 'alid and legiti!ate grounds such as genuine business necessity. 4he Su re!e Court found that in this case, res ondents ha'e !ore than a! ly discharged this burden "ith roof of the circu!stances surrounding +ngr. Carlos) e! loy!ent as Pro erty -anager for the Pro3ect and the conse,uent una'ailability of a si!ilar osition for Leynes. ippon >ousing P*il. Inc., et al. vs. Maia* Angela 0eynes, G.R. o. !66%!", August $, '#!!. Pleading$ 'erification. Ferification of a leading is a for!al, not 3urisdictional, re,uire!ent intended to secure the assurance that the !atters alleged in a leading are true and correct. (t is dee!ed substantially co! lied "ith "hen one "ho has a! le %no"ledge to s"ear to the truth of the allegations in the co! laint or etition signs the 'erification, and "hen !atters alleged in the etition ha'e been !ade in good faith or are true and correct. (n this case, the Su re!e Court found that the etition)s 'erification substantially co! lied "ith the re,uire!ents of the rules. 4he SPA authori5ed ;ello1*na to re resent ;ello in the case fro! "hich the resent etition "ith the Su re!e Court originated. As the daughter of ;ello, ;ello1*na is dee!ed to ha'e sufficient %no"ledge to s"ear to the truth of the allegations in the etition, "hich are !atters of record in the lo"er tribunals and the a ellate court. 2rancis -ello, represented *erein by *is daug*ter and attorney.in.5act, Geraldine -ello.<na vs. -oni5acio )ecurity )ervices, Inc. and )amuel ?omas, G.R. o. !%%#%", August $, '#!!. Dis!issal$ constructi'e dis!issal. Case la" defines constructi'e dis!issal as a cessation of "or% because continued e! loy!ent has been rendered i! ossible, unreasonable, or unli%ely, as "hen there is a de!otion in ran% or di!inution in ay, or both, or "hen a clear discri!ination, insensibility, or disdain by an e! loyer beco!es unbearable to the e! loyee. (n this case, other than his bare and self1ser'ing allegations, ;ello has not offered any e'idence that he "as ro!oted in a s an of four !onths since his e! loy!ent as traffic !arshal in July 2001 to a detach!ent co!!ander in :o'e!ber 2001. At !ost, the ;SS( !erely changed his assign!ent or transferred hi! to the ost "here his ser'ice "ould be !ost beneficial to its clients. 4he !anage!ent)s rerogati'e of transferring and reassigning e! loyees fro! one area of o eration to another in order to !eet the re,uire!ents of the business is generally not constituti'e of constructi'e dis!issal. 4his "as "hat e2actly occurred in this case. 2rancis -ello, represented *erein by *is daug*ter and attorney.in.5act, Geraldine -ello.<na vs. -oni5acio )ecurity )ervices, Inc. and )amuel ?omas, G.R. o. !%%#%", August $, '#!!. Procedural rules$ failure to attach du licate original or certified true co y of the assailed decision. 4he refusal of the Court of A eals to consider the etition "as the absence of a du licate original or certified true co y of the assailed :L/C decision, in 'iolation of Section =, /ule E> of the /ules of Court .in relation to Section 1, /ule >B0. 4he co! any, ho"e'er, corrected the rocedural la se by attaching a certified co y of the :L/C decision to its !otion for reconsideration. 4he Su re!e Court found that the CA reci itately denied the etition for certiorari based on an o'erly rigid a lication of the rules of rocedure. (n effect, it sacrificed substance to for! in a situation "here the etitioners) recourse "as not atently fri'olous or !eritless. 4hus, the case "as re!anded to the :L/C for resolution of its a eal. (obel Enterprises and/or Mr. -enedict 0im vs. 0R, and Eric Martine@, )r., G.R. o. !&8#$!, August %, '#!!. A eal$ decision or resolution of :L/C. As "as enunciated in the case of )t. Martin 2uneral >ome v. 0R,, the s ecial ci'il action of certiorari under /ule >B of the /ules of Ci'il Procedure, "hich is filed before the CA, is the ro er 'ehicle for 3udicial re'ie" of decisions of the :L/C. 4he etition should be initially filed before the Court of A eals in strict obser'ance of the doctrine on hierarchy of courts as the a ro riate foru! for the relief desired. 4hus,

res ondent)s recourse to the CA "as the ro er re!edy to ,uestion the resolution of the :L/C. Ato9 -ig Aedge ,ompany, Inc. vs. (esus P. Gison, G.R. o. !"&+!#, August %, '#!!. +! loyer1e! loyee relationshi $ four1fold test. 4o ascertain the e2istence of an e! loyer1 e! loyee relationshi 3uris rudence has in'ariably adhered to the four1fold test, to "it# .10 the selection and engage!ent of the e! loyee$ .20 the ay!ent of "ages$ .=0 the o"er of dis!issal$ and .E0 the o"er to control the e! loyee)s conduct, or the so1called Ccontrol test.D A lying the afore!entioned test, an e! loyer1e! loyee relationshi "as found to be absent in the case at bar. A!ong other things, res ondent "as not re,uired to re ort e'eryday during regular office hours of etitioner. /es ondent)s !onthly retainer fees "ere aid to hi! either at his residence or a local restaurant. -ore i! ortantly, etitioner did not rescribe the !anner in "hich res ondent "ould acco! lish any of the tas%s in "hich his e2 ertise as a liaison officer "as needed$ res ondent "as left alone and gi'en the freedo! to acco! lish the tas%s using his o"n !eans and !ethod. Ferily, the absence of the ele!ent of control on the art of the etitioner engenders a conclusion that he is not an e! loyee of the etitioner. Ato9 -ig Aedge ,ompany, Inc. vs. (esus P. Gison, G.R. o. !"&+!#, August %, '#!!. +! loy!ent$ regular e! loyee. Article 270 of the Labor Code, in "hich the lo"er court used to buttress its findings that res ondent beca!e a regular e! loyee of the etitioner, is not a licable in the case at bar. 4he Su re!e Court has ruled that said ro'ision is not the yardstic% for deter!ining the e2istence of an e! loy!ent relationshi because it !erely distinguishes bet"een t"o %inds of e! loyees, i.e., regular e! loyees and casual e! loyees, for ur oses of deter!ining the right of an e! loyee to certain benefits, to 3oin or for! a union, or to security of tenure$ it does not a ly "here the e2istence of an e! loy!ent relationshi is in dis ute. (t is, therefore, erroneous on the art of the Court of A eals to rely on Article 270 in deter!ining "hether an e! loyer1e! loyee relationshi e2ists bet"een res ondent and the etitioner. 4herefore, des ite the fact that etitioner !ade use of the ser'ices of res ondent as a art1ti!e consultant on retainer basis for ele'en years, he still cannot be considered as a regular e! loyee of etitioner using only as basis Article 270 of the Labor Code. Ato9 -ig Aedge ,ompany, Inc. vs. (esus P. Gison, G.R. o. !"&+!#, August %, '#!!. Clai! of disability benefits and sic%ness allo"ance$ re orting re,uire!ents. Anent a seafarer)s entitle!ent to co! ensation and benefits for in3ury and illness, Section 201; .=0 of 2000 P*+A1 S+C ro'ides that in order for the seafarer to clai! the said benefits, he !ust sub!it hi!self to a ost1e! loy!ent !edical e2a!ination by a co! any1designated hysician "ithin three "or%ing days u on his return, e2ce t "hen he is hysically inca acitated to do so, in "hich case, a "ritten notice to the agency "ithin the sa!e eriod is dee!ed as co! liance. 9ailure of the seafarer to co! ly "ith the !andatory re orting re,uire!ent shall result in his forfeiture of the right to clai! the abo'e benefits. (n this case, there "as no dis ute regarding the fact that +sguerra had altogether failed to co! ly "ith the !andatory re orting re,uire!ent. +sguerra also did not resent any e'idence to ro'e 3ustification for his inability to sub!it hi!self to a ost1e! loy!ent !edical e2a!ination by a co! any1designated hysician. Self1ser'ing and unsubstantiated declarations are insufficient to establish a case before ,uasi13udicial bodies "here the ,uantu! of e'idence re,uired in establishing a fact is substantial e'idence. ,oastal )a5eway Marine )ervices vs. Esguerra, G.R. o. !%+$+', August !#, '#!!.

September 2011 Philippine Supreme Court Decisions on Labor Law and Procedure
Posted on *ctober 16, 2011 by Leslie C. Dy Here are selected Se te!ber 2011 rulings of the Su re!e Court of the Phili ines on labor la" and rocedure# +! loyee$ robationary e! loyee. +! loy!ent on robationary status of teaching ersonnel is not only go'erned by the Labor Code but also by the -anual of /egulations for Pri'ate Schools. Section 61 of the -anual of /egulations for Pri'ate Schools, states that# C+'ery contract of e! loy!ent shall s ecify the designation, ,ualification, salary rate, the eriod and nature of ser'ice and its date of effecti'ity, and such other ter!s and condition of e! loy!ent as !ay be consistent "ith la"s and rules, regulations and standards of the school.D 4hus, it is i! ortant that the contract of robationary e! loy!ent s ecify the eriod or ter! of its effecti'ity. (n this case, therefore, the letters sent by etitioner College Dean Sr. /acadio, "hich "ere de'oid of s ecifics, cannot be considered as contracts. 4he closest they can rese!ble to are that of infor!al corres ondence a!ong the said indi'iduals. As such, etitioner school has the right not to rene" the contracts of the res ondents, the old ones ha'ing e2 ired at the end of their ter!s. Assu!ing, arguendo, that the e! loy!ent contracts bet"een the etitioner school and the res ondent s ouses "ere rene"ed, the SC found that there "as a 'alid and 3ust cause for their dis!issal since etitioners ha'e re eatedly 'iolated se'eral de art!ental and instructional olicies, such as the late sub!ission of final grades, failure to sub!it final test ,uestions to the Progra! Coordinator, the gi'ing of tests in essay for! instead of the !ulti le choice for!at as !andated by the school and the high nu!ber of students "ith failing grades in the classes that he handled. )t. Paul ,ollege Bue@on ,ity, et al. vs. Remigio Mic*ael A. Anc*eta II and ,ynt*ia A. Anc*eta, G.R. o. !"&&#+. )eptember 6, '#!!. +! loyee$ e2istence of e! loyer1e! loyee relationshi . 4o deter!ine the e2istence of an e! loyer1e! loyee relationshi , case la" has consistently a lied the four1fold test. /es ondents argue that the ele!ent of control is lac%ing in this case, !a%ing etitioner1referee an inde endent contractor and not an e! loyee of res ondents. 4he Su re!e Court agreed as it found that there "as no control o'er the !eans and !ethods by "hich etitioner erfor!s his "or% as a referee officiating a P;A bas%etball ga!e. 4he contractual sti ulations in the retainer contracts do not ertain to, !uch less dictate, ho" and "hen etitioner "ill blo" the "histle and !a%e calls. *n the contrary, they !erely ser'e as rules of conduct or guidelines in order to !aintain the integrity of the rofessional bas%etball league. -oreo'er, the follo"ing circu!stances indicate that etitioner is an inde endent contractor# .10 the referees are re,uired to re ort for "or% only "hen P;A ga!es are scheduled, "hich is three ti!es a "ee% s read o'er an a'erage of only 10B laying days a year, and they officiate ga!es at an a'erage of t"o hours er ga!e$ and .20 the only deductions fro! the fees recei'ed by the referees are "ithholding ta2es. 4here are no deductions for contributions to the Social Security Syste!, Philhealth or Pag1 (big, "hich are the usual deductions fro! e! loyees) salaries. 4hese undis uted circu!stances buttress the fact that etitioner is an inde endent contractor, and not an e! loyee of res ondents. (ose Mel -ernante vs. P*ilippine -as9etball Association, et al., G.R. o. !&'#%8. )eptember !8, '#!!.

+! loyee benefits$ rinci le against di!inution of benefits. 4he issue in this case "as "hether or not the change in the sche!e of distribution of the incre!ental roceeds fro! tuition fee increase is a di!inution of benefit. 4he Court held that it "as not. 8enerally, e! loyees ha'e a 'ested right o'er e2isting benefits 'oluntarily granted to the! by their e! loyer. 4he rinci le against di!inution of benefits, ho"e'er, is a licable only if the grant or benefit is founded on an e2 ress olicy or has ri ened into a ractice o'er a long eriod of ti!e "hich is consistent and deliberate. (n other "ords, the benefit !ust be characteri5ed by regularity and the 'oluntary and deliberate intent of the e! loyer to grant the benefits o'er a significant eriod of ti!e. (n the case at bench, contrary to G++A)s clai!, the distribution of the A0H incre!ental roceeds based on e,ual sharing sche!e cannot be held to ha'e ri ened into a co! any ractice since the ractice has not been for a long eriod of ti!e. 4he sa!e could not also ha'e ri ened into a 'ested right because such grant "as not a deliberate and 'oluntary act on the art of the etitioner. 4he Su re!e Court held that the grant by an e! loyer of benefits through an erroneous a lication of the la" due to the absence of clear ad!inistrati'e guidelines is not considered a 'oluntary act "hich cannot be unilaterally discontinued. University o5 t*e East vs. University o5 t*e East EmployeesC Association, G.R. o. !6&+&$. )eptember !8, '#!!. +! loy!ent benefits$ entitle!ent to 'acation and sic% lea'e. ;P( contends that at the ti!e of Gy)s dis!issal, she "as no longer functioning as a teller of the ban% but as a lo"1counter staff and as such, Gy is not any!ore entitled to the teller)s functional allo"ance ursuant to co! any olicy. ;P( further argues that Gy is neither entitled to the !onetary con'ersion of 'acation and sic% lea'es for failure to ro'e that she is entitled to these benefits at the ti!e of her dis!issal. 4he Su re!e Court ruled that Gy is entitled to the teller)s functional allo"ance but not to the !onetary con'ersion of 'acation and sic% lea'es. Gy)s function as a teller at the ti!e of her dis!issal "as factually established and "as ne'er i! ugned by the arties during the roceedings held in the !ain case. ;esides, ;P( did not resent any e'idence to substantiate its allegation that Gy "as assigned as a lo"1counter staff at the ti!e of her dis!issal. (t is a hornboo% rule that he "ho alleges !ust ro'e. As to the 'acation and sic% lea'e cash con'ersion benefit, the Su re!e Court held that entitle!ent to the sa!e should be necessarily ro'ed since this ri'ilege is not statutory or !andatory in character but only 'oluntarily granted. As such, the e2istence of this benefit as "ell as the e! loyee)s entitle!ent thereto cannot be resu!ed but should be ro'ed by the e! loyee. (n this case, ho"e'er, the records failed to ro'e that Gy "as recei'ing this benefit at the ti!e of her dis!issal on Dece!ber 1E, 166B. -PI Employees Union.Metro Manila, et al. vs. -an9 o5 t*e P*ilippine Islands/-an9 o5 t*e P*ilippine Islands vs. -PI Employees Union.Metro Manila, et al., G.R. os. !6%"&&/!6%6$+. )eptember '!, '#!!. 4er!ination$ constructi'e dis!issal. 4he conce t of constructi'e dis!issal is ina licable to res ondents in this case. Constructi'e dis!issal occurs "hen there is cessation of "or% because continued e! loy!ent is rendered i! ossible, unreasonable, or unli%ely as "hen there is a de!otion in ran% or di!inution in ay or "hen a clear discri!ination, insensibility, or disdain by an e! loyer beco!es unbearable to the e! loyee lea'ing the latter "ith no other o tion but to ,uit. 4hat the res ondents "ere indeed not constructi'ely dis!issed "as found by the Su re!e Court to be su orted by substantial e'idence. 2irst, res ondents Do!ingo and /e!igio, e'en "hile their etition for certiorari "as ending before the CA, re!ained e! loyed at G:(LA;. (n those instances, there "as actually no dis!issal to s ea% of. )econd, the res ondents) ositions "ere not abolished, unli%e its ro'incial de ots "here the e! loyees therein "ere considered redundant e! loyees. (n this case, their accounting functions "ere !erely consolidated under the 9inance Di'ision of Gnilab ursuant to its Shared Ser'ices Policy .SSP0. /es ondents, "ho are accounting e! loyees, cannot refuse their assign!ent to the 9inance Di'ision. 4he Su re!e Court noted that it cannot acce t the ro osition that "hen an e! loyee

o oses his e! loyer)s decision to transfer hi! to another "or% lace, there being no bad faith or underhanded !oti'es on the art of either arty, that the e! loyee)s "ishes should be !ade to re'ail. United 0aboratories, Inc. vs. (aime 3omingo )ubstituted by *is spouse ,armencita Pun@alan 3omingo, et al., G.R. o. !%"'#&, )eptember '!, '#!!. 4er!ination$ loss of trust and confidence. Loss of confidence should ideally a ly only to# .10 cases in'ol'ing e! loyees occu ying ositions of trust and confidence, or .20 situations "here the e! loyee is routinely charged "ith the care and custody of the e! loyer)s !oney or ro erty. As branch !anager of the ban%, Lo e5 occu ied a C osition of trust.D His hold on his osition and his stay in the ser'ice de end on the e! loyer)s trust and confidence in hi! and on his !anagerial ser'ices. (n this case, the Su re!e Court found that Lo e5)s dis!issal "as 3ustified. He betrayed the trust and confidence of the e! loyer1ban% "hen he issued the sub3ect urchase orders "ithout authority and des ite the e2 ress directi'e of the ban% to ut the client)s a lication on hold. 4he ban% had a genuine concern o'er the granted loan a lications as it found through its credit co!!ittee that Hert5 "as a credit ris%. &hether the credit co!!ittee "as correct or not is i!!aterial as the ban%)s direct order left Lo e5 "ithout any authority to clear the loan a lication on his o"n. Elmer 0ope@ vs. Deppel -an9 P*ilippines, Inc. et al., G.R. o. !6"%##. )eptember +, '#!!. 4er!ination$ loss of trust and confidence. Ju!uad "as found to ha'e "illfully breached her duties as to be un"orthy of the trust and confidence of Hi19lyer. 9irst, Ju!uad "as a !anagerial e! loyee$ she e2ecuted !anage!ent olicies and had the o"er to disci line the e! loyees of I9C branches in her area. She reco!!ended actions on e! loyees to the head office. According to the Su re!e Court, based on established facts, the !ere e2istence of the grounds for the loss of trust and confidence 3ustifies etitioner)s dis!issal. (n the resent case, the C+/)s re orts of Hi19lyer sho" that there "ere ano!alies co!!itted in the I9C branches !anaged by Ju!uad. *n the rinci le of respondeat superior or co!!and res onsibility alone, Ju!uad !ay be held liable for negligence in the erfor!ance of her !anagerial duties. She !ay not ha'e been directly in'ol'ed in causing the cash shortages in I9C1;ohol, but her in'ol'e!ent in not erfor!ing her duty !onitoring and su orting the day to day o erations of the branches and ensure that all the facilities and e,ui !ent at the restaurant "ere ro erly !aintained and ser'iced, could ha'e re'ented the "hole debacle fro! occurring. Pamela 2lorentina P. (umuad vs. >i.2lyer 2ood, Inc. and/or (esus R. Montemayor, G.R. o. !%6%%6. )eptember 6, '#!!. 4er!ination$ illegal dis!issal. (n the case at bar, res ondent security guards "ere relie'ed fro! their osts because they filed "ith the Labor Arbiter a co! laint against their e! loyer for !oney clai!s due to under ay!ent of "ages. 4he Su re!e Court found that this "as not a 'alid cause for dis!issal. 4he Labor Code enu!erates se'eral 3ust and authori5ed causes for a 'alid ter!ination of e! loy!ent. An e! loyee asserting his right and as%ing for !ini!u! "age is not a!ong those causes. Alert )ecurity and Investigation Agency, Inc., et al. vs. )aidali Pasawilan, et al., G.R. o. !%'$&6. )eptember !8, '#!!. 4er!ination$ abandon!ent of "or%. Petitioners a'er that res ondents "ere !erely transferred to a ne" ost "herein the "ages are ad3usted to the current !ini!u! "age standards. 4hey !aintain that the res ondents 'oluntarily abandoned their 3obs "hen they failed to re ort for duty in the ne" location. Assu!ing that this contention "as true, the Su re!e Court held that there "as no abandon!ent of "or%. 9or there to be abandon!ent# first, there should be a failure of the e! loyee to re ort for "or% "ithout a 'alid or 3ustifiable reason, and second, there should be a sho"ing that the e! loyee intended to se'er the e! loyer1e! loyee relationshi . 4he fact that

etitioners filed a co! laint for illegal dis!issal is indicati'e of their intention to re!ain e! loyed "ith ri'ate res ondent. *n the first ele!ent of failure to re ort for "or%, in this case, there "as no sho"ing that res ondents "ere notified of their ne" assign!ents. 8ranting that the CDuty Detail *rdersD "ere indeed issued, they ser'ed no ur ose unless the intended reci ients of the orders are infor!ed of such. 4herefore, the Court held that there "as no abandon!ent of "or% in this case. Alert )ecurity and Investigation Agency, Inc., et al. vs. )aidali Pasawilan, et al., G.R. o. !%'$&6. )eptember !8, '#!!. 4er!ination$ gross and habitual neglect. :eglect of duty, to be a ground for dis!issal, !ust be both gross and habitual. (n this case, /es ondent)s re eated failure to turn o'er his tas% of re aring the ayroll of the etitioner)s e! loyees to so!eone ca able of erfor!ing the 'ital tas%s "hich he could not effecti'ely erfor! or underta%e because of his heart ail!ent or condition constitutes gross neglect. Ho"e'er, although the dis!issal "as legal, res ondent "as still held to be entitled to a se aration ay as a !easure of co! assionate 3ustice, considering his length of ser'ice and his oor hysical condition "hich "as one of the reasons he filed a lea'e of absence. As a general rule, an e! loyee "ho has been dis!issed for any of the 3ust causes enu!erated under Article 272 of the Labor Code is not entitled to se aration ay. ;y "ay of e2ce tion, ho"e'er, the grant of se aration ay or so!e other financial assistance !ay be allo"ed to an e! loyee dis!issed for 3ust causes on the basis of e,uity. issan Motors P*ils., Inc. vs. /ictorino Angelo, G.R. o. !"8!%!. )eptember !8, '#!!. 4er!ination$ a"ard of bac%"ages. 4he base figure in co! uting the a"ard of bac% "ages to an illegally dis!issed e! loyee is the e! loyee)s basic salary lus regular allo"ances and benefits recei'ed at the ti!e of dis!issal, un,ualified by any "age and benefit increases granted in the interi!. 4he full bac%"ages, as referred to in the body of the -arch =1, 200B Su re!e Court decision ertains to Cbac%"agesD as defined in /e ublic Act :o. >A1B. Gnder said la", and as ro'ided in 3uris rudence, Cfull bac%"agesD !eans bac%"ages "ithout any deduction or ,ualification, including benefits or their !onetary e,ui'alent the e! loyee is en3oying at the ti!e of his dis!issal. Conse,uently, any benefit or allo"ance o'er and abo'e that allo"ed and ro'ided by said la" is dee!ed e2cluded under the said Su re!e Court Decision. -PI Employees Union.Metro Manila, et al. vs. -an9 o5 t*e P*ilippine Islands/-an9 o5 t*e P*ilippine Islands vs. -PI Employees Union.Metro Manila, et al., G.R. os. !6%"&&/!6%6$+. )eptember '!, '#!!.

October 2011 Philippine Supreme Court Decisions on Labor Law and Procedure
Posted on :o'e!ber 6, 2011 by Leslie C. Dy Here are selected *ctober 2011 rulings of the Su re!e Court of the Phili ines on labor la" and rocedure# Labor Law

Dis!issal$ constructi'e dis!issal. 9or a transfer not to be considered a constructi'e dis!issal, the e! loyer !ust be able to sho" that the transfer is for a 'alid reason, entails no di!inution in the ter!s and conditions of e! loy!ent, and !ust not be unreasonably incon'enient or re3udicial to the e! loyee. (f the e! loyer fails to !eet these standards, the e! loyee)s transfer shall a!ount, at the 'ery least, to constructi'e dis!issal. (n this case, the Su re!e Court found that the real reason -enese "as transferred fro! being the agency)s ayroll and billing cler% of the P8H detach!ent to being a lady guard in the agency)s !ain office, "as because of the re,uest of Da ula, the ne" chief of the GP1P8H Security Di'ision. 4he latter)s re,uest "as based on the fact that she had co!!itted the re'ious osition of -enese to a certain A!y Claro, a rotJgJe of Da ula. 4hus, the Su re!e Court found 3ustification for -enese)s refusal to be transferred. :ot only "as the transfer arbitrary and done in bad faith, it "ould also result in a de!otion in ran% and a di!inution in ay# .10 she "ould hold the osition of lady guard and .20 she "ould be aid in accordance "ith the statutory !ini!u! "age, or fro! P11,A20.00 to PA,B00.00. Clearly, there "as a de!otion in ran% and salary underta%en in bad faith a!ounting to constructi'e dis!issal. Emirate )ecurity and Maintenance )ystems, Inc. and Roberto Ean vs. Glenda M. Menese, G.R. o. !%'%8%. <ctober +, '#!!. Dis!issal$ illegal. /esignation is defined as Cthe 'oluntary act of e! loyees "ho are co! elled by ersonal reasons to disassociate the!sel'es fro! their e! loy!ent. (t !ust be done "ith the intention of relin,uishing an office, acco! anied by the act of abandon!ent.D (n this case, the e'idence on record suggested that etitioner did not resign$ he "as orally dis!issed by Sy. 4he crucial factor is the 'erbal order directly gi'en by Sy, the co! any resident, for etitioner to i!!ediately turn o'er his accountabilities. (t is this lac% of clear, 'alid and legal cause, not to !ention due rocess that !ade his dis!issal illegal, "arranting reinstate!ent and the a"ard of bac%"ages. -oreo'er, the filing of a co! laint for illegal dis!issal 3ust three "ee%s later is difficult to reconcile "ith 'oluntary resignation. Had etitioner intended to 'oluntarily relin,uish his e! loy!ent after being uncere!oniously dis!issed by no less than the co! any resident, he "ould not ha'e sought redress fro! the :L/C and 'igorously ursued this case against the res ondents. (*ori@aldy Uy vs. ,entro ,eramica ,orporation, et al., G.R. o. !68"$!. <ctober !&, '#!!. +! loyee$ death benefits. 4he death of a sea!an during the ter! of e! loy!ent !a%es the e! loyer liable to his heirs for death co! ensation benefits. 4his rule, ho"e'er, is not absolute. 4he e! loyer !ay be e2e! t fro! liability if he can successfully ro'e that the sea!an)s death "as caused by an in3ury directly attributable to his deliberate or "illful act. 4he Su re!e Court agreed that Danilo died of As hy2ia by strangulation as ro'ed by the :;( ost1!orte! findings and certification issued by the !edico1legal officer, Dr. /eyes. 4he hotoco y of the fa2 trans!ission of the ur orted +nglish translation of Dr. Ha!eed)s !edical re ort to ro'e that Danilo co!!itted suicide should not be considered since the !edical re ort)s genuineness and due e2ecution "ere un'erifiable# .10 the e2istence of the original !edical re ort, "hich "as "ritten in the arabic language, "as not e'en attached to the records and has not been ro'ed$ .20 the identity of the erson "ho !ade the translation and "hether the translator has the recogni5ed co! etence in both +nglish and the language the !edical re ort "as originally "ritten "ere not established$ .=0 the alleged translated !edical re ort "as not e'en signed by Dr. Ha!eed "hich creates doubt as to its authenticity. 4he unsigned translated !edical re ort is nothing but a self1 ser'ing docu!ent "hich ought to be treated as a !ere scra of a er de'oid of any e'identiary 'alue e'en in ad!inistrati'e roceedings. Maritime 2actors Inc. vs. -ienvenido R. >indang, G.R. o. !+!&&$. <ctober !&, '#!!.

+! loyee benefits$ entitle!ent to retire!ent benefits. A se aration ay at the ti!e of the reorgani5ation of the :ational Po"er Cor oration and retire!ent benefits at the a ro riate future ti!e are t"o se arate and distinct entitle!ents. Stated other"ise, a retire!ent lan is a different rogra! fro! a se aration ac%age. (n /.A. :o. 1>1>, the retirees are entitled to gratuity benefits to be aid by the last e! loyer and refund of re!iu!s to be aid by the 8S(S. *n the other hand, retire!ent benefits under C.A. :o. 17>, as a!ended by /.A. :o. 7261, are to be aid by the 8S(S. (n 'ie" of the fact that se aration ay and retire!ent benefits are different entitle!ents, as they ha'e different legal bases, different sources of funds, and different intents, the Ce2clusi'eness of benefitsD rule ro'ided under /.A. :o. 7261 is not a licable. .Section BB of /.A. :o. 7261 states# C&hene'er other la"s ro'ide si!ilar benefits for the sa!e contingencies co'ered by this Act, the !e!ber "ho ,ualifies to the benefits shall ha'e the o tion to choose "hich benefits "ill be aid to hi!.D0 Enri=ue U. -etoy vs. ?*e -oard o5 3irectors, ational Power ,orporation, G.R. os. !+"++".+6. <ctober 8, '#!!. +! loyee$ o'erti!e ay. A clai! for o'erti!e ay "ill not be granted in the absence of any factual and legal basis. (n this res ect, the records indicated that the labor arbiter granted -enese)s clai! for holiday ay, rest day and re!iu! ay on the basis of ayrolls. 4here is no such roof in su ort of -enese)s clai! for o'erti!e ay other than her contention that she "or%ed fro! 7#00 a.!. u to B#00 .!. She resented no e'idence to sho" that she "as "or%ing during the entire one hour !eal brea%. 4he Su re!e Court thus found the :L/C)s deletion of the o'erti!e ay a"ard in order. Emirate )ecurity and Maintenance )ystems, Inc. and Roberto Ean vs. Glenda M. Menese, G.R. o. !%'%8%. <ctober +, '#!!. +! loyee$ er!anent disability benefits. Per!anent disability refers to the inability of a "or%er to erfor! his 3ob for !ore than 120 days, regardless of "hether he loses the use of any art of his body. &hat deter!ines etitioner)s entitle!ent to er!anent disability benefits is his inability to "or% for !ore than 120 days. 4he certification by the co! any1designated hysician that etitioner is fit to "or% "as issued after 166 days or !ore than 120 days fro! the ti!e he "as !edically re atriated to the Phili ines. Petitioner herein "as !edically re atriated to the Phili ines on *ctober 7, 2001. Ho"e'er, it "as only on A ril 2B, 2002 or after a la se of 166 days that Dr. Cru5 issued a certification declaring hi! fit to "or%. 4hus, the Su re!e Court found that etitioner)s disability is considered permanent and total because the Cfit to "or%D certification "as issued by Dr. Cru5 only on A ril 2B, 2002, or !ore than 120 days after he "as !edically re atriated on *ctober 7, 2001. 9urther!ore, the co! any1designated hysician)s certification that etitioner is fit to "or% does not !a%e hi! ineligible for er!anent total disability benefits. It does not matter that the co! any1designated hysician assessed etitioner as fit to "or%. (t is undis uted that fro! the ti!e etitioner "as re atriated on *ctober 7, 2001, he "as unable to "or% for !ore than 120 days as he "as only certified fit to "or% on A ril 2B, 2002. Conse,uently, etitioner)s disability is considered er!anent and total. ,armelito . /alen@ona vs. 2air )*ipping ,orporation, et al., G.R. o. !6"%%8. <ctober !&, '#!!. 8S(S$ retire!ent lan. Section E1.n0 of /e ublic Act :o. 7261 conte! lates a situation "herein 8S(S, due to a reorgani5ation, a strea!lining of its organi5ation, or so!e other circu!stance, "hich calls for the ter!ination of so!e of its e! loyees, !ust design a lan to encourage, induce, or !oti'ate these e! loyees, "ho are not yet ,ualified for either o tional or co! ulsory retire!ent under our la"s, to instead 'oluntarily retire. Such is not the case "ith the 8S(S /9P. (ts 'ery ob3ecti'e, Cto !oti'ate and re"ard e! loyees for !eritorious, faithful, and satisfactory ser'ice,D contradicts the nature of an early retire!ent incenti'e lan, or a financial assistance lan, "hich in'ol'es a substantial a!ount that is gi'en to !oti'ate e! loyees to retire early. (nstead, it falls e2actly "ithin the ur ose of a retire!ent benefit, "hich is a for! of

re"ard for an e! loyee)s loyalty and lengt*y ser'ice, in order to hel hi! or her en3oy the re!aining years of his life. &ithout a doubt, the 8S(S /9P is a su le!entary retire!ent lan, "hich is rohibited by the 4e'es /etire!ent La". Government )ervice Insurance )ystem 1G)I)4, et al. vs. ,ommission on Audit, et al., G.R. o. !"'$6'. <ctober !&, '#!!. Stri%e$ illegal stri%e. 4here is no ,uestion that the -ay >, 2002 stri%e "as illegal, 5irst, because "hen Iilusang -anggaga"a ng L8S, -agdala -ulti ur ose and Li'elihood Coo erati'e .I-L-S0 filed the notice of stri%e on -arch B or 1E, 2002, it had not yet ac,uired legal ersonality and, thus, could not legally re resent the e'entual union and its !e!bers. And second, si!ilarly, "hen I-L-S conducted the stri%e1'ote on A ril 7, 2002, there "as still no union to s ea% of, since I-L-S only ac,uired legal ersonality as an inde endent legiti!ate labor organi5ation only on A ril 6, 2002 or the day after it conducted the stri%e1'ote. Conse,uently, the !andatory notice of stri%e and the conduct of the stri%e1'ote re ort "ere ineffecti'e for ha'ing been filed and conducted before I-L-S ac,uired legal ersonality as a legiti!ate labor organi5ation, 'iolating Art. 2>=.c0, .d0 and .f0 of the Labor Code and /ule KK((, ;oo% F of the *!nibus /ules (! le!enting the Labor Code. (t is, thus, clear that I-L-S did not co! ly "ith the !andatory re,uire!ent of la" and i! le!enting rules on ossession of a legal ersonality as a legiti!ate labor organi5ation. Magdala Multipurpose F 0iveli*ood, et al. vs. DM0M), et al., G.R. o. !&!!$%.$&. <ctober !&, '#!!. Gnion sho $ ne" e! loyees. -ay a cor oration in'o%e its !erger "ith another cor oration as a 'alid ground to e2e! t its Cabsorbed e! loyeesD fro! the co'erage of a union sho clause contained in its e2isting Collecti'e ;argaining Agree!ent .C;A0 "ith its o"n certified labor unionL 4he Su re!e Court ruled in the negati'e. 4he for!er 9+;4C e! loyees retained the regular status that they ossessed "hile "or%ing for their for!er e! loyer u on their absor tion by etitioner ;P(. 4his fact "ould not re!o'e the! fro! the sco e of the hrase Cne" e! loyeesD as conte! lated in the Gnion Sho Clause of the C;A. 4he Gnion Sho Clause in the C;A si! ly states that Cne" e! loyeesD "ho during the effecti'ity of the C;A C!ay be regularly e! loyedD by the ;an% !ust 3oin the union "ithin thirty .=00 days fro! their regulari5ation. 4he lain language of the C;A ro'ision not"ithstanding, the SC held that there is nothing in the said clause that li!its its a lication to only ne" e! loyees "ho ossess non1 regular status, !eaning robationary status, at the start of their e! loy!ent. &hat is indubitable fro! the Gnion Sho Clause is that u on the effecti'ity of the C;A, etitioner)s ne" regular e! loyees .regardless of the !anner by "hich they beca!e e! loyees of ;P(0 are re,uired to 3oin the Gnion as a condition of their continued e! loy!ent. -an9 o5 t*e P*ilippine Islands vs. -PI Employees Union.3avao ,*apter.2ederation o5 Unions in -PI Uniban9, G.R. o. !"8$#!. <ctober !&, '#!!. Procedural Law :L/C$ Certiorari. A "rit of certiorari is a re!edy to correct errors of 3urisdiction, for "hich reason it !ust clearly sho" that the ublic res ondent has no 3urisdiction to issue an order or to render a decision. /ule >B of the /ules of Court has instituted the etition for certiorari to correct acts of any tribunal, board or officer e2ercising 3udicial or ,uasi13udicial functions "ith gra'e abuse of discretion a!ounting to lac% or e2cess of 3urisdiction. 4his re!edy ser'es as a chec% on acts, either of e2cess or assi'ity, that constitute gra'e abuse of discretion of a 3udicial or ,uasi13udicial function. (n this case, the SC found that the CA roceeded to re'ie" the records and to rule on issues that "ere no longer dis uted during the a eal to the :L/C, such as the e2istence of an e! loyer1e! loyee relationshi . 4he i'otal issue before the :L/C "as "hether etitioner)s telling res ondent to ta%e a rest, or to ha'e a brea%, "as already a ositi'e

act of dis!issing hi!. 4his issue "as not discussed by the CA. 4he SC re'ie"ed the :L/C /esolution that re'ersed the LA Decision and found nothing in it that "as "hi!sical, unreasonable or atently 'iolati'e of the la". (t "as the CA "hich erred in finding faults that "ere ine2istent in the :L/C /esolution. AGG ?ruc9ing and/or Ale7 Ang Gaeid vs. Melanio -. Euag, G.R. o. !&+#$$. <ctober !', '#!!. :L/C$ !otion for reconsideration. *n the issue of the ro riety of entertaining the Petition for Certiorari des ite the rescribed -otion for /econsideration "ith the :L/C, the SC found that the CA co!!itted error "hen it entertained the etition for certiorari and e2 lained that "hen res ondent failed to file a -otion for /econsideration of the :L/C)s =0 :o'e!ber 200> /esolution "ithin the regle!entary eriod, the /esolution attained finality and could no longer be !odified by the Court of A eals. Gnti!eliness in filing !otions or etitions is not a !ere technical or rocedural defect, as leniency regarding this re,uire!ent "ill i! inge on the right of the "inning litigant to eace of !ind resulting fro! the laying to rest of the contro'ersy. AGG ?ruc9ing and/or Ale7 Ang Gaeid vs. Melanio -. Euag, G.R. o. !&+#$$. <ctober !', '#!!.

o!ember 2011 Philippine Supreme Court Decisions on Labor Law and Procedure
Posted on Dece!ber 1>, 2011 by Leslie C. Dy Here are selected :o'e!ber 2011 rulings of the Su re!e Court of the Phili ines on labor la" and rocedure# A"ard of attorney)s fees$ conce ts. 4here are t"o co!!only acce ted conce ts of attorney)s fees ? the ordinary and e2traordinary. (n its ordinary conce t, an attorney)s fee is the reasonable co! ensation aid to a la"yer by his client for the legal ser'ices the for!er renders$ co! ensation is aid for the cost and<or results of legal ser'ices er agree!ent or as !ay be assessed. (n its e2traordinary conce t, attorney)s fees are dee!ed inde!nity for da!ages ordered by the court to be aid by the losing arty to the "inning arty. 4his is payable not to t*e lawyer but to t*e client , unless the client and his la"yer ha'e agreed that the a"ard shall accrue to the la"yer as additional or art of his co! ensation. Article 111 of the Labor Code, as a!ended, conte! lates the e2traordinary conce t of attorney)s fees. Although an e2 ress finding of facts and la" is still necessary to ro'e the !erit of the a"ard, there need not be any sho"ing that the e! loyer acted !aliciously or in bad faith "hen it "ithheld the "ages. 4hus the SC concluded that the CA erred in ruling that a finding of the e! loyer)s !alice or bad faith in "ithholding "ages !ust recede an a"ard of attorney)s fees under Article 111 of the Labor Code. 4o reiterate, a lain sho"ing that the la"ful "ages "ere not aid "ithout 3ustification is sufficient. Daisa*an at Dapatiran ng mga Manggagawa at Dawani sa MA,.East Gone Union and Eduardo -orela, etc. vs. Manila Aater ,ompany, Inc., G.R. o. !68!6&. ovember !", '#!!. A"ard of attorney)s fees$ Article 111. *ne of the issues of this case in'ol'ed the effect of the -e!orandu! of Agree!ent ro'ision that attorney)s fees shall be deducted fro! the a!elioration allo"ance .AA0 and C;A recei'ables. (n this regard, the CA held that the

additional grant of 10H attorney)s fees by the :L/C 'iolates Article 111 of the Labor Code, considering that the -*A bet"een the arties already ensured the ay!ent of 10H attorney)s fees deductible fro! the AA and C;A recei'ables of the Gnion)s !e!bers. (n the resent case, the Gnion bound itself to ay 10H attorney)s fees to its counsel under the -*A and also ga'e u the attorney)s fees a"arded to the Gnion)s !e!bers in fa'or of their counsel. 4he a"ard by the :L/C cannot be ta%en to !ean an additional grant of attorney)s fees, in 'iolation of the ten ercent .10H0 li!it under Article 111 of the Labor Code since it rests on an entirely different legal obligation than the one contracted under the -*A. Si! ly stated, the attorney)s fees contracted under the -*A do not refer to the a!ount of attorney)s fees a"arded by the :L/C$ the -*A ro'ision on attorney)s fees does not ha'e any bearing at all to the attorney)s fees a"arded by the :L/C under Article 111 of the Labor Code. ;ased on these considerations, it is clear that the CA erred in ruling that the LA)s a"ard of attorney)s fees 'iolated the !a2i!u! li!it of ten ercent .10H0 fi2ed by Article 111 of the Labor Code. Daisa*an at Dapatiran ng mga Manggagawa at Dawani sa MA,.East Gone Union and Eduardo -orela, etc. vs. Manila Aater ,ompany, Inc., G.R. o. !68!6&. ovember !", '#!!. Disability benefits$ co! ensable. (n this case, res ondent "as diagnosed "ith Central /etinal Fein *cclusion of his left eye. Central retinal 'ein occlusion causes ainless 'ision loss "hich is usually sudden, but it can also occur gradually o'er a eriod of days to "ee%s. 4his condition, des ite nu!erous !edical rocedures underta%en, e'entually led to a total loss of sight of res ondent)s left eye. Loss of one bodily function falls "ithin the definition of disability "hich is essentially Closs or i! air!ent of a hysical or !ental function resulting fro! in3ury or sic%ness.D 4he dis utable resu! tion that a articular in3ury or illness that results in disability, or in so!e cases death, is "or%1related stands in the absence of contrary e'idence. (n the case at bench, the said resu! tion "as not o'erturned by the etitioners. Although, the e! loyer is not the insurer of the health of his e! loyees, he ta%es the! as he finds the! and assu!es the ris% of liability. Conse,uently, the Court concurred "ith the finding of the lo"er courts that res ondent)s disability is co! ensable. 2il.star Maritime ,orporation, et al. vs. >an@iel <. Resete, G.R. o. !&'"%". ovember '$, '#!!. Disability benefits$ total disability. A total disability does not re,uire that the e! loyee be co! letely disabled, or totally araly5ed. &hat is necessary is that the in3ury !ust be such that the e! loyee cannot ursue his or her usual "or% and earn fro! it. *n the other hand, a total disability is considered er!anent if it lasts continuously for !ore than 120 days. &hat is crucial is "hether the e! loyee "ho suffers fro! disability could still erfor! his "or% not"ithstanding the disability he incurred. +'idently, res ondent "as not able to return to his 3ob as a seafarer after his left eye "as declared legally blind. /ecords sho"ed that the etitioners did not gi'e hi! a ne" o'erseas assign!ent after his disability. 4his only ro'ed that his disability effecti'ely barred his chances to be de loyed abroad as an officer of an ocean1going 'essel. Hence, the Su re!e Court found it fitting that res ondent be entitled to er!anent total disability benefits considering that he "ould not be able to resu!e his osition as a !ariti!e officer, and the robability that he "ould be hired by other !ariti!e e! loyers "ould be close to i! ossible. 2il.star Maritime ,orporation, et al. vs. >an@iel <. Resete, G.R. o. !&'"%". ovember '$, '#!!. Dis!issal$ gross and habitual neglect of duties. 8ross negligence connotes "ant of care in the erfor!ance of one)s duties, "hile habitual neglect i! lies re eated failure to erfor! one)s duties for a eriod of ti!e, de ending on the circu!stances. (n the case at bench, Padao "as accused of ha'ing resented a fraudulently ositi'e e'aluation of the business, credit standing<rating and financial ca ability of /eynaldo and Lu5'illa ;alu!a and ele'en other loan

a licants. So!e businesses "ere e'entually found not to e2ist at all, "hile in other transactions, the financial status of the borro"ers si! ly could not su ort the grant of loans in the a ro'ed a!ounts. -oreo'er, Padao o'er1a raised the collateral of s ouses 8ardito and Al!a A3ero, and that of s ouses (haba and /olly Pango. Padao)s re eated failure to discharge his duties as a credit in'estigator of the ban% a!ounted to gross and habitual neglect of duties under Article 272 .b0 of the Labor Code. He not only failed to erfor! "hat he "as e! loyed to do, but also did so re etiti'ely and habitually, causing !illions of esos in da!age to P:;. 4hus, P:; acted "ithin the bounds of the la" by !eting out the enalty of dis!issal, "hich it dee!ed a ro riate gi'en the circu!stances. P*ilippine ational -an9 vs. 3an Padao, G.R. os. !%#%8& and !%6!8$. ovember !", '#!!. Dis!issed e! loyees$ se aration ay. Padao is not entitled to financial assistance. 4he rule regarding se aration ay as a !easure of social 3ustice is that it shall be aid only in those instances "here the e! loyee is 'alidly dis!issed for causes other than serious !isconduct, "illful disobedience, gross and habitual neglect of duty, fraud or "illful breach of trust, co!!ission of a cri!e against the e! loyer or his fa!ily, or those reflecting on his !oral character. (n this case, Padao "as guilty of gross and habitual neglect of duties. P*ilippine ational -an9 vs. 3an Padao, G.R. os. !%#%8& and !%6!8$. ovember !", '#!!. +! loy!ent of seafarers. 4he e! loy!ent of seafarers, including clai!s for death benefits, is go'erned by the contracts they sign e'ery ti!e they are hired or rehired$ and as long as the sti ulations therein are not contrary to la", !orals, ublic order or ublic olicy, they ha'e the force of la" bet"een the arties. &hile the seafarer and his e! loyer are go'erned by their !utual agree!ent, the P*+A rules and regulations re,uire that the P*+A Standard +! loy!ent Contract .P*+A1S+C0 be integrated in e'ery seafarer)s contract. (n this case, considering that etitioner e2ecuted an o'erseas e! loy!ent contract "ith res ondent co! any in :o'e!ber 1666, the 166> P*+A1S+C should go'ern. 4he 2000 P*+A1S+C initially too% effect on June 2B, 2000. 4hereafter, the Court issued the 4e! orary /estraining *rder 1?R<4 "hich "as later lifted on June B, 2002. 4hus, etitioner cannot si! ly rely on the dis utable resu! tion ro'ision !entioned in Section 20 .;0.E0 of the 2000 P*+A1S+C "hich states that# C4hose illnesses not listed in Section =2 of this Contract are dis utably resu!ed as "or% related.D Gilbert Bui@ora vs. 3en*olm ,rew Management 1P*ilippines4, Inc., G.R. o. !%+8!'. ovember !", '#!!. +! loy!ent of seafarers$ disability co! ensation. 8ranting that the ro'isions of the 2000 P*+A1S+C a ly, the dis utable resu! tion ro'ision in Section 20 .;0 does not allo" etitioner to 3ust sit do"n and "ait for res ondent co! any to resent e'idence to o'erco!e the dis utable resu! tion of "or%1relatedness of the illness. Contrary to his osition, the seafarer still has to substantiate his clai! in order to be entitled to disability co! ensation. He has to ro'e that the illness he suffered "as "or%1related and that it !ust ha'e e2isted during the ter! of his e! loy!ent contract. 9or disability to be co! ensable under Section 20 .;0 of the 2000 P*+A1S+C, t"o ele!ents !ust concur# .10 the in3ury or illness !ust be "or%1related$ and .20 the "or%1related in3ury or illness !ust ha'e e2isted during the ter! of the seafarer)s e! loy!ent contract. (n other "ords, to be entitled to co! ensation and benefits under this ro'ision, it is not sufficient to establish that the seafarer)s illness or in3ury has rendered hi! er!anently or artially disabled$ it !ust also be sho"n that there is a causal connection bet"een the seafarer)s illness or in3ury and the "or% for "hich he had been contracted. Gnfortunately for etitioner, he failed to ro'e that his 'aricose 'eins arose out of his e! loy!ent "ith res ondent co! any. Gilbert Bui@ora vs. 3en*olm ,rew Management 1P*ilippines4, Inc., G.R. o. !%+8!'. ovember !", '#!!.

+! loyee)s co! ensation$ increased ris% theory. 9or a sic%ness or resulting disability or death to be co! ensable, the clai!ant !ust ro'e either .10 that the e! loyee)s sic%ness "as the result of an occu ational disease listed under Anne2 CAD of the A!ended /ules on +! loyees) Co! ensation, or .20 that the ris% of contracting the disease "as increased by his "or%ing conditions. Gnder the increased ris% theory, there !ust be a reasonable roof that the e! loyee)s "or%ing condition increased his ris% of contracting the disease, or that there is a connection bet"een his "or% and the cause of the disease. (n this case, since ;esitan)s ail!ent, +nd Stage /enal Disease secondary to Chronic 8lo!erulone hritis is not a!ong those listed under Anne2 CA,D of the A!ended /ules on +! loyees) Co! ensation, he needs to sho" by substantial e'idence that his ris% of contracting the disease "as increased by his "or%ing condition. Government )ervice Insurance )ystem vs. Manuel P. -esitan, G.R. o. !6%&#!. ovember '$, '#!!. +! loyees)s Co! ensation$ roceedings$ ,uantu! of roof. Direct and clear e'idence, is not necessary to ro'e a co! ensable clai!. Strict rules of e'idence do not a ly as PD :o. >2> only re,uires substantial e'idence. 4he SC found that ;esitan has sufficiently ro'ed that his "or%ing condition increased his ris% of contracting 8lo!erulone hritis, "hich according to 8S(S !ay be caused by bacterial, 'iral, and arasitic infection. &hen ;esitan entered the go'ern!ent ser'ice in 16A>, he "as gi'en a clean bill of health. (n 200B, he "as diagnosed "ith +nd Stage /enal Disease secondary to Chronic 8lo!erulone hritis. (t "ould a ear therefore that the nature of his "or% could ha'e increased his ris% of contracting the disease. His fre,uent tra'els to re!ote areas in the country could ha'e e2 osed hi! to certain bacterial, 'iral, and arasitic infection, "hich in turn could ha'e caused his disease. Delaying his urination during his long tri s to the ro'inces could ha'e also increased his ris% of contracting the disease. As a !atter of fact, e'en the ;an% Physician of ;ang%o Sentral ng Pili inas, Dr. 8regorio Suare5 ((, agreed that ;esitan)s "or%ing condition could ha'e contributed to the "ea%ening of his %idneys, "hich could ha'e caused the disease. 4his -edical Certificate is sufficient to ro'e that the "or%ing condition of ;esitan increased his ris% of contracting 8lo!erulone hritis. (n clai!s for co! ensation benefits, a doctor)s certification as to the nature of a clai!ant)s disability deser'es full credence because no !edical ractitioner "ould issue certifications indiscri!inately. Government )ervice Insurance )ystem vs. Manuel P. -esitan, G.R. o. !6%&#!. ovember '$, '#!!. (llegal dis!issal$ e! loyer1e! loyee relationshi . 4he ele!ents to deter!ine the e2istence of an e! loy!ent relationshi are# .a0 the selection and engage!ent of the e! loyee$ .b0 the ay!ent of "ages$ .c0 the o"er of dis!issal$ and .d0 the e! loyer)s o"er to control the e! loyee)s conduct. (n this case, the docu!entary e'idence resented by res ondent to ro'e that he "as an e! loyee of etitioner are as follo"s# .a0 a docu!ent deno!inated as C ayrollD .dated July =1, 2001 to -arch 1B, 20020 certi5ied correct by petitioner, "hich sho"ed that res ondent recei'ed a !onthly salary of PA,000.00 "ith the corres onding deductions due to absences incurred by res ondent$ and .20 co ies of etty cash 'ouchers, sho"ing the a!ounts he recei'ed and signed for in the ayrolls. 4hese docu!ents sho"ed that etitioner hired res ondent as an e! loyee and he "as aid !onthly "ages of PA,000.00. Additionally, as to the e2istence of the o"er of control, it is not essential for the e! loyer to actually su er'ise the erfor!ance of duties of the e! loyee. (t is sufficient that the for!er has a right to "ield the o"er. (n this case, etitioner e'en stated in his Position Pa er that it "as agreed that he "ould hel and teach res ondent ho" to use the studio e,ui !ent. (n such case, etitioner certainly had the o"er to chec% on the rogress and "or% of res ondent. ,esar ,. 0irio, doing business under t*e name and style o5 ,el9or Ad )onimi7 vs. Ailmer 3. Genovia , G.R. o. !"&6+6. ovember '$, '#!!.

(llegal recruit!ent$ ele!ents. 4he cri!e of illegal recruit!ent is co!!itted "hen t"o ele!ents concur, na!ely# .10 the offender has no 'alid license or authority re,uired by la" to enable one to la"fully engage in recruit!ent and lace!ent of "or%ers$ and .20 he underta%es either any acti'ity "ithin the !eaning of Crecruit!ent and lace!entD defined under Article 1= .b0, or any rohibited ractices enu!erated under Article =E of the Labor Code. 9irst, the etitioner "as found not to ha'e been issued a license as ro'en by the certification fro! the D*L+1Dagu an District *ffice stating that etitioner has not been issued any license by the P*+A and neither is it a holder of an authority to engage in recruit!ent and lace!ent acti'ities. Second, fro! the testi!onies of the ri'ate res ondents, it is a arent that etitioner "as able to con'ince the ri'ate res ondents to a ly for "or% in (srael after arting "ith their !oney in e2change for the ser'ices she "ould render. 4he said act of the etitioner, "ithout a doubt, falls "ithin the !eaning of recruit!ent and lace!ent as defined in Article 1= .b0 of the Labor Code. 9inally, the Su re!e Court noted that in illegal recruit!ent cases, the failure to resent recei ts for !oney that "as aid in connection "ith the recruit!ent rocess "ill not affect the strength of the e'idence resented by the rosecution as long as the ay!ent can be ro'ed through clear and con'incing testi!onies of credible "itnesses. 3elia 3. Romero vs. People o5 t*e P*ilippines, Romulo Padlan and Aruturo )iapno, G.R. o. !6!"88. ovember '$, '#!!. Probationary e! loy!ent$ security of tenure. (t is settled that e'en if robationary e! loyees do not en3oy er!anent status, they are accorded the constitutional rotection of security of tenure. 4his !eans they !ay only be ter!inated for a 3ust cause or "hen they other"ise fail to ,ualify as regular e! loyees in accordance "ith reasonable standards !ade %no"n to the! by the e! loyer at the ti!e of their engage!ent. (n this case, the 3ustification gi'en by the etitioners for Sy)s dis!issal "as her alleged failure to ,ualify by the co! any)s standard. *ther than the general allegation that said standards "ere !ade %no"n to her at the ti!e of her e! loy!ent, ho"e'er, no e'idence, docu!entary or other"ise, "as resented to substantiate the sa!e. :either "as there any erfor!ance e'aluation resented to ro'e that indeed hers "as unsatisfactory. Hence, for failure of the etitioners to su ort their clai! of unsatisfactory erfor!ance by Sy, the SC held that Sy)s e! loy!ent "as un3ustly ter!inated to re'ent her fro! ac,uiring a regular status in circu!'ention of the la" on security of tenure. ?amsonCs Enterprises, Inc., et al. vs. ,ourt o5 Appeals and Rosemarie 0. )y, G.R. o. !&'%%!. ovember !", '#!!. Probationary e! loy!ent$ ter!ination. +'en on the assu! tion that Sy indeed failed to !eet the standards set by the etitioner1e! loyer and !ade %no"n to the for!er at the ti!e of her engage!ent, still, the ter!ination "as fla"ed for failure to gi'e the re,uired notice to Sy. Section 2, /ule (, ;oo% F( of the (! le!enting /ules ro'ides that# C(f the ter!ination is brought about by the co! letion of a contract or hase thereof, or by failure of an e! loyee to !eet the standards of the e! loyer in the case of robationary e! loy!ent, it shall be sufficient that a "ritten notice is ser'ed the e! loyee, "ithin a reasonable ti!e fro! the effecti'e date of ter!ination.D ?amsonCs Enterprises, Inc., et al. vs. ,ourt o5 Appeals and Rosemarie 0. )y, G.R. o. !&'%%!. ovember !", '#!!. 4er!ination of e! loy!ent$ "hen co! any tolerated 'iolation of co! any olicy. 4he CA "as correct in stating that "hen the 'iolation of co! any olicy or breach of co! any rules and regulations is tolerated by !anage!ent, it cannot ser'e as a basis for ter!ination. 4his rinci le, ho"e'er, only a lies "hen the breach or 'iolation is one "hich neither a!ounts to nor in'ol'es fraud or illegal acti'ities. (n such a case, one cannot e'ade liability or cul ability based on obedience to the cor orate chain of co!!and. (n this case, Padao, in affi2ing his signature on the fraudulent re orts, attested to the falsehoods contained therein. -oreo'er, by doing so, he

re eatedly failed to erfor! his duties as a credit in'estigator. 4hus, the ter!ination of his e! loy!ent is 3ustified. P*ilippine ational -an9 vs. 3an Padao, G.R. os. !%#%8& and !%6!8$. ovember !", '#!!.

January 2012 Philippine Supreme Court Decisions on Labor Law and Procedure
Posted on 9ebruary 1A, 2012 by Leslie C. Dy Here are selected January 2012 rulings of the Su re!e Court of the Phili ines on labor la" and rocedure# Certiorari$ effect of recei t of a"ard. 4he re'ailing arty)s recei t of the full a!ount of the 3udg!ent a"ard ursuant to a "rit of e2ecution issued by the labor arbiter does not close or ter!inate the case if such recei t is ,ualified as "ithout re3udice to the outco!e of the etition for certiorari ending "ith the Court of A eals. ?imoteo >. )arona vs. ational 0abor Relations ,ommission, Royale )ecurity Agency, et al., G.R. o. !%+'%#, (anuary !%, '#!!. Constructi'e dis!issal$ change in osition. Constructi'e dis!issal e2ists "here there is cessation of "or% because Ccontinued e! loy!ent is rendered i! ossible, unreasonable or unli%ely, as an offer in'ol'ing a de!otion in ran% or a di!inution in ayD and other benefits. A tly called a dis!issal in disguise of an act a!ounting to dis!issal but !ade to a ear as if it "ere not,constructi'e dis!issal !ay, li%e"ise, e2ist if an act of clear discri!ination, insensibility, or disdain by an e! loyer beco!es so unbearable on the art of the e! loyee that it could foreclose any choice by hi! e2ce t to forego his continued e! loy!ent.(n cases of a transfer of an e! loyee, the rule is settled that the e! loyer is charged "ith the burden of ro'ing that its conduct and action are for 'alid and legiti!ate grounds such as genuine business necessity and that the transfer is not unreasonable, incon'enient or re3udicial to the e! loyee. (f the e! loyer cannot o'erco!e this burden of roof, the e! loyee)s transfer shall be tanta!ount to unla"ful constructi'e dis!issal. (onat*an /. Morales vs. >arbour ,entre Port ?erminal, Inc., G.R. o. !68'#%, (anuary '+, '#!!. Contract$ no'ation. :o'ation is the e2tinguish!ent of an obligation by the substitution or change of the obligation by a subse,uent one "hich e2tinguishes or !odifies the first, either by changing the ob3ect or rinci al conditions, or, by substituting another in lace of the debtor, or by subrogating a third erson in the rights of the creditor. (n order for no'ation to ta%e lace, the concurrence of the follo"ing re,uisites is indis ensable# .10 4here !ust be a re'ious 'alid obligation$ .20 4here !ust be an agree!ent of the arties concerned to a ne" contract$ .=0 4here !ust be the e2tinguish!ent of the old contract$ and .E0 4here !ust be the 'alidity of the ne" contract. 4he arties i! liedly e2tinguished the first contract by agreeing to enter into the second contract. 4he records also re'eal that the 2nd contract e2tinguished the first contract by changing its ob3ect or rinci al. 4hese contracts "ere for o'erseas e! loy!ent aboard different 'essels. 4he first contract "as for e! loy!ent aboard the -F CStolt As irationD "hile the second contract in'ol'ed "or%ing in another 'essel, the -F CStolt Pride.D Petitioners and -ade,uillo, Jr. acce ted the ter!s and conditions of the second contract. Gndoubtedly, he "as still e! loyed

under the first contract "hen he negotiated "ith etitioners on the second contract. Since -ade,uillo "as still e! loyed under the first contract "hen he negotiated "ith etitioners on the second contract, no'ation beca!e an una'oidable conclusion. )tolt. ielsen ?ransportation Group, Inc., et al. vs. )ulpecio Mode=uillo, G.R. o. !668&%, (anuary !%, '#!!. +! loyee$ !oney clai!s. *n the issue of ho" the seafarer "ill be co! ensated by reason of the unreasonable non1de loy!ent, the Su re!e Court decreed the a lication of Section 10 of /e ublic Act :o. 70E2 .-igrant &or%ers Act0 "hich ro'ides for !oney clai!s by reason of a contract in'ol'ing 9ili ino "or%ers for o'erseas de loy!ent. 4he la" ro'ides# Sec. 10. Money ,laims. ? :ot"ithstanding any ro'ision of la" to the contrary, the Labor Arbiters of the :ational Labor /elations Co!!ission .:L/C0 shall ha'e the original and e2clusi'e 3urisdiction to hear and decide, "ithin ninety .600 calendar days after the filing of the co! laint, the clai!s arising out of an e! loyer1e! loyee relationshi or by 'irtue of any la" or contract in'ol'ing 9ili ino "or%ers for o'erseas de loy!ent including clai!s for actual, !oral, e2e! lary and other for!s of da!ages. 2 2 2 .Gnderscoring su lied0 9ollo"ing the la", the clai! is still cogni5able by the labor arbiters of the :L/C under the second hrase of the ro'ision. A lying the rules on actual da!ages, Article 2166 of the :e" Ci'il Code ro'ides that one is entitled to an ade,uate co! ensation only for such ecuniary loss suffered by hi! as he has duly ro'ed. )tolt. ielsen ?ransportation Group, Inc., et al. vs. )ulpecio Mode=uillo, G.R. o. !668&%, (anuary !%, '#!!. +! loyee$ re'enti'e sus ension$ enalty of sus ension. Pre'enti'e sus ension is a disci linary !easure resorted to by the e! loyer ending in'estigation of an alleged !alfeasance or !isfeasance co!!itted by an e! loyee. 4he e! loyer te! orarily bars the e! loyee fro! "or%ing if his continued e! loy!ent oses a serious and i!!inent threat to the life or ro erty of the e! loyer or of his co1"or%ers. *n the other hand, the enalty of sus ension refers to the disci linary action i! osed on the e! loyee after an official in'estigation or ad!inistrati'e hearing is conducted. 4he e! loyer e2ercises its right to disci line erring e! loyees ursuant to co! any rules and regulations. (n the resent case, Henry Delada filed a grie'ance against -anila Pa'ilion Hotel .-PH0. 9ailing to reach a settle!ent, Delada lodged a Co! laint before the :ational Conciliation and -ediation ;oard, "hich "as e'entually referred to a anel of 'oluntary arbitrators .PFA0. -ean"hile, citing security and safety reasons, -PH laced Delada on a =01day re'enti'e sus ension and roceeded "ith the ad!inistrati'e case against hi!. -PH e'entually found Delada liable for insubordination and "illful disobedience of the transfer order and i! osed u on hi! a enalty of 601day sus ension. 4he PFA ruled that there "as no legal and factual basis to su ort -PH)s i! osition of re'enti'e sus ension on Delada, and that the enalty of 601day sus ension i! osed by -PH against Delada "ent beyond the =01day eriod of re'enti'e sus ension rescribed by the (! le!enting /ules of the Labor Code. PFA also ruled that -PH lost its authority to continue "ith the ad!inistrati'e roceedings for insubordination and "illful disobedience of the transfer order and to i! ose the enalty of 601day sus ension on Delada. According to the anel, it ac,uired e2clusi'e 3urisdiction o'er the issue "hen the arties sub!itted the afore!entioned issues before it. 4he Su re!e Court held that -PH did not lose its authority to disci line, and that -PH had the authority to continue "ith the ad!inistrati'e roceedings for insubordination and "illful disobedience against Delada and to i! ose on hi! the enalty of sus ension. Manila Pavilion >otel, etc. vs. >enry 3elada, G.R. o. !%&&86, (anuary '+, '#!!.

+! loyee$ release and ,uitclai!. &hile the la" loo%s "ith disfa'or u on releases and ,uitclai!s by e! loyees "ho are in'eigled or ressured into signing the! by unscru ulous e! loyers see%ing to e'ade their legal res onsibilities, a legiti!ate "ai'er re resenting a 'oluntary settle!ent of a laborer)s clai!s should be res ected by the courts as the la" bet"een the arties. Considering the etitioner)s clai! of fraud and bad faith against Philco!sat to be unsubstantiated, the Su re!e Court found the ,uitclai! in dis ute to be a legiti!ate "ai'er. 4he Court of A eals and the :ational Labor /elations Co!!ission "ere unani!ous in holding that the etitioner 'oluntarily e2ecuted the sub3ect ,uitclai!. 4he Su re!e Court is not a trier of facts, and this doctrine a lies "ith greater force in labor cases. 9actual ,uestions are for the labor tribunals to resol'e and "hether the etitioner 'oluntarily e2ecuted the sub3ect ,uitclai! is a ,uestion of fact. (n this case, the factual issues ha'e already been deter!ined by the :ational Labor /elations Co!!ission and its findings "ere affir!ed by the Court of A eals. Judicial re'ie" by the Su re!e Court does not e2tend to a ree'aluation of the sufficiency of the e'idence u on "hich the ro er labor tribunal has based its deter!ination. >ypte R. AuHero vs. P*ilippine ,ommunications )atellite ,orporation, G.R. o. !&$8%8, (anuary !%, '#!!. +! loyee benefit$ holiday ay, ser'ice incenti'e lea'e ay and ro ortionate 1= th !onth ay. Gnder the Labor Code, the e! loyee is entitled to his regular rate on holidays e'en if he does not "or%. Li%e"ise, e2 ress ro'ision of the la" entitles hi! to ser'ice incenti'e lea'e benefit if he has rendered ser'ice for !ore than a year already. 9urther!ore, under Presidential Decree :o. 7B1, the e! loyee should be aid his 1=th !onth ay. 4he e! loyer has the burden of ro'ing that it has aid these benefits to its e! loyees. Abdul(ua*id R. Pigcaulan vs. )ecurity and ,redit Investigation, Inc. and/or Rene Amby Reyes, G.R. o. !6$"8%, (anuary !", '#!!. +! loyee benefit$ o'erti!e ay. (n the absence of any concrete roof that additional ser'ice beyond the nor!al "or%ing hours and days had been rendered, o'erti!e ay cannot be granted. Hand"ritten ite!i5ed co! utations are self1ser'ing, unreliable and unsubstantiated e'idence to sustain the grant of salary differentials, articularly o'erti!e ay. Gnsigned and unauthenticated as they are, there is no "ay of 'erifying the truth of the hand"ritten entries stated therein. Abdul(ua*id R. Pigcaulan vs. )ecurity and ,redit Investigation, Inc. and/or Rene Amby Reyes, G.R. o. !6$"8%, (anuary !", '#!!. +! loyee benefit$ er!anent disability. 4he Su re!e Court reiterated Remigio v. ational 0abor Relations ,ommission, G.R. o. !+&%%6, April !', '##", "hich stated that# C4hus, the Court has a lied the Labor Code conce t of er!anent total disability to the case of seafarers. (n P*ilippine ?ransmarine ,arriers v. 0R,, G.R. o. !'$%&!, 2ebruary '%, '##!, sea!an Carlos :ietes "as found to be suffering fro! congesti'e heart failure and cardio!yo athy and "as declared as unfit to "or% by the co! any1accredited hysician. 4he Court affir!ed the a"ard of disability benefits to the sea!an, citing E,, v. )anico, G.R. o. !$8#'%, 3ecember !6, !&&&, G)I) v. ,A, G.R. o. !!6+6', (anuary '&, !&&% , G)I) v. ,A, G.R. o. !!"#!+, (uly $!, !&&" and -eHerano v. E,,, G. R. o. %8666, (anuary $#, !&&', that Cdisability should not be understood !ore on its !edical significance but on the loss of earning ca acity. Per!anent total disability !eans disable!ent of an e! loyee to earn "ages in the sa!e %ind of "or%, or "or% of si!ilar nature that MheN "as trained for or accusto!ed to erfor!, or any %ind of "or% "hich a erson of MhisN !entality and attain!ent could do. (t does not !ean absolute hel lessness.D (t li%e"ise cited -eHerano to reiterate that in a disability co! ensation, it is not the in3ury "hich is co! ensated, but rather it is the inca acity to "or% resulting in the i! air!ent of one)s earning ca acity. 4he Court also cited the !ore recent case of ,rystal )*ipping, Inc. v. atividad, G.R. o. !+86&%, <ctober '#, '##+, a lying the sa!e rinci les, and G)I) v. ,adi@, G.R. o. !8+#&$, (uly %, '##$, and IHares v. ,A, G.R. o. !#+%+8, August '", !&&&, "hich

declared that C er!anent disability is the inability of a "or%er to erfor! his 3ob for !ore than 120 days, regardless of "hether or not he loses the use of any art of his body.D Magsaysay Maritime ,orporation, et al. vs. <berto ). 0obusta, G.R. o. !66+6%, (anuary '+, '#!!. +! loyee dis!issal$ due rocess. :otice and hearing constitute the essential ele!ents of due rocess in the dis!issal of e! loyees. 4he e! loyer !ust furnish the e! loyee "ith t"o "ritten notices before ter!ination of e! loy!ent can be legally effected. 4he first a rises the e! loyee of the articular acts or o!issions for "hich dis!issal is sought. 4he second infor!s the e! loyee of the e! loyer)s decision to dis!iss hi!. &ith regard to the re,uire!ent of a hearing, the essence of due rocess lies si! ly in an o ortunity to be heard, and not that an actual hearing should al"ays and indis ensably be held. 4hese re,uire!ents "ere satisfied in this case. 4he first re,uired notice "as dated :o'e!ber =, 200=, sufficiently notifying Oabut of the articular acts being i! uted against hi!, as "ell as the a licable la" and the co! any rules considered to ha'e been 'iolated. *n :o'e!ber 1A, 200=, -eralco conducted a hearing on the charges against the etitioner "here he "as accorded the right to air his side and resent his defenses on the charges against hi!. Significantly, a high1ran%ing officer of the su er'isory union of -eralco assisted hi! during the said in'estigation. His s"orn state!ent that for!s art of the case records e'en listed the !atters that "ere raised during the in'estigation. 9inally, -eralco ser'ed a notice of dis!issal dated 9ebruary E, 200E u on Oabut. Such notice notified the latter of the co! any)s decision to dis!iss hi! fro! e! loy!ent on the grounds clearly discussed therein. orman Eabut vs. Manila Electric ,ompany and Manuel M. 0ope@, G.R. o. !&#8$", (anuary !", '#!!. +! loyee dis!issal$ due rocess. +'en if there is a 3ust or 'alid cause for ter!inating an e! loyee, it is necessary to co! ly "ith the re,uire!ents of due rocess rior to the ter!ination. 0olita ). ,oncepcion vs. Mine7 Import ,orporation/Minerama ,orporation, et al., G.R. o. !+$+"&, (anuary '8, '#!!. +! loyee dis!issal$ gross negligence$ habitual neglect. 8ross negligence has been defined as the C"ant of care in the erfor!ance of one)s dutiesD and habitual neglect has been defined as Cre eated failure to erfor! one)s duties for a eriod of ti!e, de ending u on the circu!stances.D 4hese are not o'erly technical ter!s, "hich, in the first lace, are e2 ressly sanctioned by the Labor Code of the Phili ines, to "it# A/4. 272. ?ermination by employer. ? An e! loyer !ay ter!inate an e! loy!ent for any of the follo"ing causes# M222N.b0 8ross and habitual neglect by the e! loyee of his duties$ M222N Diosdado ;itara "as dis!issed fro! ser'ice due to habitual tardiness and absenteeis!, and for ha'ing continued disregarding attendance olicies des ite his underta%ing to re ort on ti!e. His "ee%ly ti!e record for the first ,uarter of the year 2000 re'ealed that he ca!e late 16 ti!es out of the EA ti!es he re orted for "or%. He also incurred 16 absences out of the >> "or%ing days during the ,uarter. His absences "ithout rior notice and a ro'al fro! -arch 1111>, 2000 "ere considered to be the !ost serious infraction of all because of its ad'erse effect on business o erations. 4he Su re!e Court held that e'en in the absence of a "ritten co! any rule defining gross and habitual neglect of duties, ;itara)s o!issions ,ualify as such "arranting his dis!issal fro! the ser'ice. Mansion Printing ,enter and ,lement ,*eng vs. 3iosdado -itara, (r., G.R. o. !"%!'#, (anuary '+, '#!!. +! loyee dis!issal$ 3ust cause$ loss of confidence. 4o dis!iss an e! loyee, the la" re,uires the e2istence of a 3ust and 'alid cause. Article 272 of the 0abor ,ode enu!erates the Hust causes for ter!ination by the e! loyer# .a0 serious !isconduct or "illful disobedience by the e! loyee of the la"ful orders of his e! loyer or the latter)s re resentati'e in connection "ith the e! loyee)s

"or%$ .b0 gross and habitual neglect by the e! loyee of his duties$ .c0 fraud or "illful breach by the e! loyee of the trust re osed in hi! by his e! loyer or his duly authori5ed re resentati'e$ .d0 co!!ission of a cri!e or offense by the e! loyee against the erson of his e! loyer or any i!!ediate !e!ber of his fa!ily or his duly authori5ed re resentati'e$ and .e0 other causes analogous to the foregoing. (t is unfair to re,uire an e! loyer to first be !orally certain of the guilt of the e! loyee by a"aiting a con'iction before ter!inating hi! "hen there is already sufficient sho"ing of the "rongdoing. /e,uiring that certainty !ay ro'e too late for the e! loyer, "hose loss !ay otentially be beyond re air. (n the resent case, no less than the D*J Secretary found robable cause for ,ualified theft against Conce cion. 4hat finding "as enough to 3ustify her ter!ination for loss of confidence. 0olita ). ,oncepcion vs. Mine7 Import ,orporation/Minerama ,orporation, et al., G.R. o. !+$+"&, (anuary '8, '#!!. +! loyee dis!issal$ loss of trust and confidence. 9or loss of trust and confidence to be a 'alid ground for dis!issal, it !ust be based on a "illful breach of trust and founded on clearly established facts. A breach is "illful if it is done intentionally, %no"ingly and ur osely, "ithout 3ustifiable e2cuse, as distinguished fro! an act done carelessly, thoughtlessly, heedlessly or inad'ertently. (n addition, loss of trust and confidence !ust rest on substantial grounds and not on the e! loyer)s arbitrariness, "hi!s, ca rices or sus icion. Manila Electric ,ompany 1Meralco4 vs. Ma. 0uisa -eltran, G.R. o. !6$668, (anuary $#, '#!!. +! loyee dis!issal$ !isconduct. Article 272.a0 ro'ides that an e! loyer !ay ter!inate an e! loy!ent because of an e! loyee)s serious !isconduct, a cause that "as resent in this case in 'ie" of the etitioner)s 'iolation of his e! loyer)s code of conduct. -isconduct is defined as the Ctransgression of so!e established and definite rule of action, a forbidden act, a dereliction of duty, "illful in character, and i! lies "rongful intent and not !ere error in 3udg!ent.D 9or serious !isconduct to 3ustify dis!issal, the follo"ing re,uisites !ust be resent# .a0 it !ust be serious$ .b0 it !ust relate to the erfor!ance of the e! loyee)s duties$ and .c0 it !ust sho" that the e! loyee has beco!e unfit to continue "or%ing for the e! loyer. (nstallation of shunting "ires is "ithout doubt a serious "rong as it de!onstrates an act that is "illful or deliberate, ursued solely to "rongfully obtain electric o"er through unla"ful !eans. 4he act clearly relates to the etitioner)s erfor!ance of his duties gi'en his osition as branch field re resentati'e "ho is e,ui ed "ith %no"ledge on !eter o erations, and "ho has the duty to test electric !eters and handle custo!ers) 'iolations of contract. (nstead of rotecting the co! any)s interest, the etitioner hi!self used his %no"ledge to illegally obtain electric o"er fro! -eralco. His in'ol'e!ent in this incident dee!s hi! no longer fit to continue erfor!ing his functions for res ondent1co! any. orman Eabut vs. Manila Electric ,ompany and Manuel M. 0ope@, G.R. o. !&#8$", (anuary !", '#!!. +! loyer1e! loyee relationshi $ co!!ence!ent. 4he P*+A Standard +! loy!ent Contract ro'ides that e! loy!ent shall co!!ence Cu on the actual de arture of the seafarer fro! the air ort or sea ort in the ort of hire.D Distinction !ust be !ade bet"een the erfection of the e! loy!ent contract and the co!!ence!ent of the e! loyer1e! loyee relationshi . 4he erfection of the contract, "hich in this case coincided "ith the date of e2ecution thereof, occurred "hen etitioner and res ondent agreed on the ob3ect and the cause, as "ell as the rest of the ter!s and conditions therein. 4he co!!ence!ent of the e! loyer1e! loyee relationshi "ould ha'e ta%en lace had etitioner been actually de loyed fro! the oint of hire. )tolt. ielsen ?ransportation Group, Inc., et al. vs. )ulpecio Mode=uillo, G.R. o. !668&%, (anuary !%, '#!!.

Judg!ent$ finality. 4he etition "as brought only on behalf of Pigcaulan. 4he CA Decision has already beco!e final and e2ecutory as to Canoy since he did not a eal fro! it. Canoy cannot no" si! ly incor orate in his affida'it a 'erification of the contents and allegations of the etition as he is not one of the etitioners therein. Abdul(ua*id R. Pigcaulan vs. )ecurity and ,redit Investigation, Inc. and/or Rene Amby Reyes, G.R. o. !6$"8%, (anuary !", '#!!. Judg!ent$ res 3udicata. 4he doctrine of res Hudicata lays do"n t"o !ain rules "hich !ay be stated as follo"s# .10 4he 3udg!ent or decree of a court of co! etent 3urisdiction on the !erits concludes the arties and their ri'ies to the litigation and constitutes a bar to a ne" action or suit in'ol'ing the sa!e cause of action either before the sa!e or any other tribunal$ and .20 Any right, fact, or !atter in issue directly ad3udicated or necessarily in'ol'ed in the deter!ination of an action before a co! etent court in "hich a 3udg!ent or decree is rendered on the !erits is conclusi'ely settled by the 3udg!ent therein and cannot again be litigated bet"een the arties and their ri'ies "hether the clai! or de!and, ur ose, or sub3ect !atter of the t"o suits is the sa!e or not. 4hese t"o !ain rules !ar% the distinction bet"een the rinci les go'erning the t"o ty ical cases in "hich a 3udg!ent !ay o erate as e'idence. (n s ea%ing of these cases, the first general rule, and "hich corres onds to aragra h .b0 of Section EA of /ule =6 of the /ules of Court is referred to as Cbar by for!er 3udg!entD "hile the second general rule, "hich is e!bodied in aragra h .c0 of the sa!e section, is %no"n as Cconclusi'eness of 3udg!ent.D 4he resent labor case is closely related to the ci'il case that "as decided "ith finality. 4he acts and o!issions alleged by the ;an% in the ci'il case as basis of its counterclai! against -auricio are the 'ery sa!e acts and o!issions "hich "ere used as grounds to ter!inate his e! loy!ent. Considering that it has already been conclusi'ely deter!ined "ith finality in the ci'il case that the ,uestioned acts of -auricio "ere "ell "ithin his discretion as branch !anager and a ro'ing officer of the ;an%, and the sa!e "ere sanctioned by the Head *ffice, the Su re!e Court found that the Court of A eals did not err in holding that there "as no 'alid or 3ust cause for the ;an% to ter!inate -auricio)s e! loy!ent. Prudential -an9 1now -an9 o5 t*e P*ilippine Islands4 vs. Antonio ).A. Mauricio, substituted by *is legal *eirs Maria 2e, /oltaire, Antonio, (r., Antonio, Earl (o*n, and 2rancisco Roberto all surnamed Mauricio, G.R. o. !%$$+#, (anuary !%, '#!!. Jurisdiction$ 'oluntary arbitrators. (n )ime 3arby Pilipinas, Inc. v. 3eputy Administrator Magsalin, G.R. o. &#8'", 3ecember !+, !&%&, the Su re!e Court ruled that the 'oluntary arbitrator had lenary 3urisdiction and authority to inter ret the agree!ent to arbitrate and to deter!ine the sco e of his o"n authority ? sub3ect only, in a ro er case, to the certiorari 3urisdiction of this Court. (t "as also held in that case that the failure of the arties to s ecifically li!it the issues to that "hich "as stated allo"ed the arbitrator to assu!e 3urisdiction o'er the related issue. (n 0udo F 0uym ,orporation v. )aornido, G.R. o. !8#&"#, (anuary '#, '##$ , the Su re!e Court recogni5ed that 'oluntary arbitrators are generally e2 ected to decide only those ,uestions e2 ressly delineated by the sub!ission agree!ent$ that, ne'ertheless, they can assu!e that they ha'e the necessary o"er to !a%e a final settle!ent on the related issues, since arbitration is the final resort for the ad3udication of dis utes. 4hus, the Su re!e Court ruled that e'en if the s ecific issue brought before the arbitrators !erely !entioned the ,uestion of C"hether an e! loyee "as discharged for 3ust cause,D they could reasonably assu!e that their o"ers e2tended beyond the deter!ination thereof to include the o"er to reinstate the e! loyee or to grant bac% "ages. (n the sa!e 'ein, if the s ecific issue brought before the arbitrators referred to the date of regulari5ation of the e! loyee, la" and 3uris rudence ga'e the! enough lee"ay as "ell as ade,uate rerogati'e to deter!ine the entitle!ent of the e! loyees to higher benefits in accordance "ith the finding of regulari5ation. (ndeed, to re,uire the arties to file another action for ay!ent of those benefits "ould certainly under!ine labor roceedings and contra'ene the constitutional !andate ro'iding full rotection to labor and

s eedy labor 3ustice. Manila Pavilion >otel, etc. vs. >enry 3elada, G.R. '+, '#!!.

o. !%&&86, (anuary

Procedural rules$ liberal a lication$ "hen "ai'ed. Procedural rules !ay be "ai'ed or dis ensed "ith in absolutely !eritorious cases. 4he Su re!e Court, in ast cases, has adhered to the strict i! le!entation of the rules and considered the! in'iolable "hen it is sho"n that the atent lac% of !erit of the a eals render liberal inter retation ointless and naught. 4he contrary obtains in this case as Philco!sat)s case is not entirely un!eritorious. S ecifically, Philco!sat alleged that the etitioner)s e2ecution of the sub3ect ,uitclai! "as 'oluntary des ite his clai! that he did not do so. Philco!sat li%e"ise argued that the etitioner)s educational attain!ent and the osition he occu ied in Philco!sat)s hierarchy !ilitate against his clai! that he "as ressured or coerced into signing the ,uitclai!. 4he e!erging trend in our 3uris rudence is to afford e'ery arty1 litigant the a! lest o ortunity for the ro er and 3ust deter!ination of his cause free fro! the constraints of technicalities. 9ar fro! ha'ing gra'ely abused its discretion, the :L/C correctly rioriti5ed substantial 3ustice o'er the rigid and stringent a lication of rocedural rules. (n the resent case, the Su re!e Court held that the CA "as correct in not finding gra'e abuse of discretion in the :L/C)s decision to gi'e due course to Philco!sat)s a eal des ite its being belatedly filed. >ypte R. AuHero vs. P*ilippine ,ommunications )atellite ,orporation, G.R. o. !&$8%8, (anuary !%, '#!!. Public officers$ reassign!ent$ constructi'e dis!issal. &hile a te! orary transfer or assign!ent of ersonnel is er!issible e'en "ithout the e! loyee)s rior consent, it cannot be done "hen the transfer is a reli!inary ste to"ard his re!o'al, or a sche!e to lure hi! a"ay fro! his er!anent osition, or "hen it is designed to indirectly ter!inate his ser'ice, or force his resignation. Such a transfer "ould in effect circu!'ent the ro'ision "hich safeguards the tenure of office of those "ho are in the Ci'il Ser'ice. Significantly, Section >, /ule ((( of CSC -e!orandu! Circular :o. E0, series of 1667, defines constructi'e dis!issal as a situation "hen an e! loyee ,uits his "or% because of the agency head)s unreasonable, hu!iliating, or de!eaning actuations "hich render continued "or% i! ossible. Hence, the e! loyee is dee!ed to ha'e been illegally dis!issed. 4his !ay occur although there is no di!inution or reduction of salary of the e! loyee. (t !ay be a transfer fro! one osition of dignity to a !ore ser'ile or !enial 3ob. Republic o5 t*e P*il., represented by t*e ,ivil )ervice ,ommission vs. Minerva M.P. Pac*eco, G.R. o. !6%#'!, (anuary $!, '#!!. /einstate!ent$ not ossible$ bac%"ages. (n case se aration ay is a"arded and reinstate!ent is no longer feasible, bac%"ages shall be co! uted fro! the ti!e of illegal dis!issal u to the finality of the decision should se aration ay not be aid in the !eanti!e. (t is the e! loyee)s actual recei t of the full a!ount of his se aration ay that "ill effecti'ely ter!inate the e! loy!ent of an illegally dis!issed e! loyee. *ther"ise, the e! loyer1e! loyee relationshi subsists and the illegally dis!issed e! loyee is entitled to bac%"ages, ta%ing into account the increases and other benefits, including the 1=th !onth ay, that "ere recei'ed by his co1 e! loyees "ho are not dis!issed. (t is the obligation of the e! loyer to ay an illegally dis!issed e! loyee or "or%er the "hole a!ount of the salaries or "ages, lus all other benefits and bonuses and general increases, to "hich he "ould ha'e been nor!ally entitled had he not been dis!issed and had not sto ed "or%ing. ?imoteo >. )arona vs. ational 0abor Relations ,ommission, Royale )ecurity Agency, et al., G.R. o. !%+'%#, (anuary !%, '#!!. /eorgani5ation$ !anage!ent rerogati'e. Ad!ittedly, the right of e! loyees to security of tenure does not gi'e the! 'ested rights to their ositions to the e2tent of de ri'ing !anage!ent of its rerogati'e to change their assign!ents or to transfer the!. ;y !anage!ent rerogati'e is

!eant the right of an e! loyer to regulate all as ects of e! loy!ent, such as the freedo! to rescribe "or% assign!ents, "or%ing !ethods, rocesses to be follo"ed, regulation regarding transfer of e! loyees, su er'ision of their "or%, lay1off and disci line, and dis!issal and recall of "or%ers. Although 3uris rudence recogni5es said !anage!ent rerogati'e, it has been ruled that the e2ercise thereof, "hile ordinarily not interfered "ith, is not absolute and is sub3ect to li!itations i! osed by la", collecti'e bargaining agree!ent, and general rinci les of fair lay and 3ustice. 4hus, an e! loyer !ay transfer or assign e! loyees fro! one office or area of o eration to another, ro'ided there is no de!otion in ran% or di!inution of salary, benefits, and other ri'ileges, and the action is not !oti'ated by discri!ination, !ade in bad faith, or effected as a for! of unish!ent or de!otion "ithout sufficient cause. (ndeed, ha'ing the right should not be confused "ith the !anner in "hich that right is e2ercised. Jonathan F. -orales "as hired by Harbour Centre Port 4er!inal, (nc. .HCP4(0 as an Accountant and Acting 9inance *fficer, "ith a !onthly salary of P17,000.00. /egulari5ed on :o'e!ber 1A, 2000, -orales "as ro!oted to Di'ision -anager of the Accounting De art!ent, for "hich he "as co! ensated a !onthly salary of P==,A00.00, lus allo"ances starting July 1, 2002. Subse,uent to HCP4()s transfer to its ne" offices at Fitas, 4ondo, -anila on January 2, 200=, -orales recei'ed an inter1 office !e!orandu! dated -arch 2A, 200=, reassigning hi! to * erations Cost Accounting, tas%ed "ith the duty of C!onitoring and e'aluating all consu!ables re,uests, gears and e,ui !entD related to the cor oration)s o erations and of interacting "ith its sub1contractor, ;ul% 9leet -arine Cor oration. 4he !e!orandu! "as issued by HCP4()s ne" Ad!inistration -anager, duly noted by its ne" Fice President for Ad!inistration and 9inance, and a ro'ed by its President and Chief +2ecuti'e *fficer. -orales rotested that his reassign!ent "as a clear de!otion since the osition to "hich he "as transferred "as not e'en included in HCP4()s lantilla. (n res onse to -orales) grie'ance that he had been effecti'ely laced on floating status, an inter1office !e!orandu! "as issued on A ril E, 200= to the effect that Ctransfer of e! loyees is a !anage!ent rerogati'eD and that HCP4( had Cthe right and res onsibility to find the erfect balance bet"een the s%ills and abilities of e! loyees to the needs of the business.D Ho"e'er, the Su re!e Court found that HCP4( did not e'en bother to sho" that it had i! le!ented a cor orate reorgani5ation and<or a ro'ed a ne" lantilla of ositions "hich included the one to "hich -orales "as being transferred. 4hus, the Court reinstated the :L/C)s July 26, 200B Decision "hich found -orales) reassign!ent to be a clear de!otion des ite lac% of sho"ing of di!inution of salaries and benefits. (onat*an /. Morales vs. >arbour ,entre Port ?erminal, Inc., G.R. o. !68'#%, (anuary '+, '#!!. /ule EB$ ,uestion of la". As a general rule, the Su re!e Court is not a trier of facts and a etition for re'ie" on certiorari under /ule EB of the /ules of Court !ust e2clusi'ely raise ,uestions of la". -oreo'er, if factual findings of the :ational Labor /elations Co!!ission and the Labor Arbiter ha'e been affir!ed by the Court of A eals, the Su re!e Court accords the! the res ect and finality they deser'e. (t is "ell1settled and oft1re eated that findings of fact of ad!inistrati'e agencies and ,uasi13udicial bodies, "hich ha'e ac,uired e2 ertise because their 3urisdiction is confined to s ecific !atters, are generally accorded not only res ect, but finality "hen affir!ed by the Court of A eals.:e'ertheless, the Su re!e Court "ill not hesitate to de'iate fro! "hat are clearly rocedural guidelines and disturb and stri%e do"n the findings of the Court of A eals and those of the labor tribunals if there is a sho"ing that they are unsu orted by the e'idence on record or there "as a atent !isa reciation of facts. (ndeed, that the i! ugned decision of the Court of A eals is consistent "ith the findings of the labor tribunals does not per se conclusi'ely de!onstrate the correctness thereof. ;y "ay of e2ce tion to the general rule, the Su re!e Court "ill scrutini5e the facts if only to rectify the re3udice and in3ustice resulting fro! an incorrect assess!ent of the e'idence resented. ?imoteo >. )arona

vs. ational 0abor Relations ,ommission, Royale )ecurity Agency, et al., G.R. (anuary !%, '#!!.

o. !%+'%#,

"ebruary 2012 Philippine Supreme Court Decisions on Labor Law and Procedure
Posted on -arch B, 2012 by Leslie C. Dy Here are select 9ebruary 2012 rulings of the Su re!e Court on labor la" and rocedure# A eal$ factual finding of :L/C. 9indings of fact of ad!inistrati'e agencies and ,uasi13udicial bodies, "hich ha'e ac,uired e2 ertise because their 3urisdiction is confined to s ecific !atters, are generally accorded not only res ect but finality "hen affir!ed by the Court of A eals. 9actual findings of ,uasi13udicial bodies li%e the :L/C, if su orted by substantial e'idence, are accorded res ect and e'en finality by the Su re!e Court, !ore so "hen they coincide "ith those of the Labor Arbiter. Such factual findings are gi'en !ore "eight "hen the sa!e are affir!ed by the Court of A eals. (n the resent case, the Su re!e Court found no reason to de art fro! these rinci les since the Labor Arbiter found that there "as substantial e'idence to conclude that *asay had breached the trust and confidence of Palacio Del 8obernador Condo!iniu! Cor oration, "hich finding the :L/C had li%e"ise u held. )ebastian 2. <asay, (r. vs. Palacio del Gobernador ,ondominium ,orporation and <mar ?. ,ru@, G.R. o. !&8$#", 2ebruary ", '#!'. Ci'il Ser'ice$ Clar% De'elo !ent Cor oration. Clar% De'elo !ent Cor oration .CDC0 o"es its e2istence to +2ecuti'e *rder :o. 70 issued by then President 9idel F. /a!os. (t "as !eant to be the i! le!enting and o erating ar! of the ;ases Con'ersion and De'elo !ent Authority tas%ed to !anage the Clar% S ecial +cono!ic Pone. +2 ressly, CDC "as for!ed in accordance "ith Phili ine cor oration la"s and e2isting rules and regulations ro!ulgated by the Securities and +2change Co!!ission ursuant to Section 1> of /e ublic Act A22A. CDC, a go'ern!ent o"ned or controlled cor oration "ithout an original charter, "as incor orated under the Cor oration Code. Pursuant to Article (K1;, Sec. 2.10 of the Constitution, the ci'il ser'ice e!braces only those go'ern!ent o"ned or controlled cor orations "ith original charter. As such, CDC and its e! loyees are co'ered by the Labor Code and not by the Ci'il Ser'ice La". Antonio -. )alenga, et al. vs. ,ourt o5 Appeals, et al., G.R. o. !68&8!, 2ebruary !, '#!'. Dis!issal$ resignation 's. illegal dis!issal$ tele2 is not e,ui'alent to tender of resignation. Article 27B of the Labor Code recogni5es ter!ination by the e! loyee of the e! loy!ent contract by Cser'ing "ritten notice on the e! loyer at least one .10 !onth in ad'ance.D 8i'en that ro'ision, the la" conte! lates the re,uire!ent of a "ritten notice of resignation. (n the absence of a "ritten resignation, it is safe to resu!e that the e! loyer ter!inated the seafarers. (n this case, the Su re!e Court found the dis!issal of De 8racia, et al. to be illegal since Cos!oshi !erely sent a tele2 to S%i ers, the local !anning agency, clai!ing that De 8racia, et al. "ere re atriated because the latter 'oluntarily re1ter!inated their contracts. )9ippers United Paci5ic, Inc. and )9ippers Maritime )ervices, Inc. 0td. vs. at*aniel 3o@a, et al., G.R. o. !6+++%. 2ebruary %, '#!'.

Dis!issal$ substanti'e and rocedural due rocess. 9or a "or%er)s dis!issal to be considered 'alid, it !ust co! ly "ith both rocedural and substanti'e due rocess. 4he legality of the !anner of dis!issal constitutes rocedural due rocess, "hile the legality of the act of dis!issal constitutes substanti'e due rocess. Procedural due rocess in dis!issal cases consists of the t"in re,uire!ents of notice and hearing. 4he e! loyer !ust furnish the e! loyee "ith t"o "ritten notices before the ter!ination of e! loy!ent can be effected# .10 the first notice a rises the e! loyee of the articular acts or o!issions for "hich his dis!issal is sought$ and .20 the second notice infor!s the e! loyee of the e! loyer)s decision to dis!iss hi!. ;efore the issuance of the second notice, the re,uire!ent of a hearing !ust be co! lied "ith by gi'ing the "or%er an o ortunity to be heard. (t is not necessary that an actual hearing be conducted. Substanti'e due rocess, on the other hand, re,uires that dis!issal by the e! loyer be !ade based on a 3ust or authori5ed cause under Articles 272 to 27E of the Labor Code. (n this case, there "as no "ritten notice furnished to De 8racia, et al. regarding the cause of their dis!issal. Cos!oshi furnished a tele2 to S%i ers, the local !anning agency, clai!ing that De 8racia, et al. "ere re atriated because they 'oluntarily re1ter!inated their contracts. 4his tele2 "as gi'en credibility and "eight by the Labor Arbiter and :L/C in deciding that there "as re1ter!ination of the e! loy!ent contract Ca%in to resignationD and no illegal dis!issal. Ho"e'er, as correctly ruled by the CA, the tele2 !essage is Ca biased and self1ser'ing docu!ent that does not satisfy the re,uire!ent of substantial e'idence.D (f, indeed, De 8racia, et al. 'oluntarily re1ter!inated their contracts, then De 8racia, et al. should ha'e sub!itted their "ritten resignations. )9ippers United Paci5ic, Inc. and )9ippers Maritime )ervices, Inc. 0td. vs. at*aniel 3o@a, et al., G.R. o. !6+++%. 2ebruary %, '#!'. +! loyee benefits$ right to bonus$ di!inution. 9ro! a legal oint of 'ie", a bonus is a gratuity or act of liberality of the gi'er "hich the reci ient cannot de!and as a !atter of right. 4he grant of a bonus is basically a !anage!ent rerogati'e "hich cannot be forced u on the e! loyer "ho !ay not be obliged to assu!e the onerous burden of granting bonuses. Ho"e'er, a bonus beco!es a de!andable or enforceable obligation if the additional co! ensation is granted "ithout any conditions i! osed for its ay!ent. (n such case, the bonus is treated as art of the "age, salary or co! ensation of the e! loyee. Particularly instructi'e is the ruling of the Court in Metro ?ransit <rgani@ation, Inc. v. ational 0abor Relations ,ommission .8./. :o. 11>007, July 11, 166B0 "here the Court said# &hether or not a bonus for!s art of "ages de ends u on the circu!stances and conditions for its ay!ent. (f it is additional co! ensation "hich the e! loyer ro!ised and agreed to gi'e "ithout any conditions i! osed for its ay!ent, such as success of business or greater roduction or out ut, then it is art of the "age. ;ut if it is aid only if rofits are reali5ed or if a certain le'el of roducti'ity is achie'ed, it cannot be considered art of the "age. &here it is not ayable to all but only to so!e e! loyees and only "hen their labor beco!es !ore efficient or !ore roducti'e, it is only an induce!ent for efficiency, a ri5e therefore, not a art of the "age. (n this case, there is no dis ute that +astern 4eleco!!unications Phils., (nc. and +astern 4eleco!s +! loyees Gnion agreed on the inclusion of a ro'ision for the grant of 1Eth, 1Bth and 1>th !onth bonuses in the 166712001 C;A Side Agree!ent, as "ell as in their 20011200E C;A Side Agree!ent, "hich contained no ,ualification for its ay!ent. 4here "ere no conditions s ecified in the C;A Side Agree!ents for the grant of the bonus. 4here "as nothing in the rele'ant ro'isions of the C;A "hich !ade the grant of the bonus de endent on the co! any)s financial standing or contingent u on the reali5ation of rofits. 4here "as also no state!ent that if the co! any deri'es no rofits, no bonus "ill be gi'en to the e! loyees. (n fine, the ay!ent of these bonuses "as not related to the rofitability of business o erations. Conse,uently, the

gi'ing of the sub3ect bonuses cannot be ere! torily "ithdra"n by +astern 4eleco!!unications Phils., (nc. "ithout 'iolating Article 100 of the Labor Code, "hich rohibits the unilateral eli!ination or di!inution of benefits by the e! loyer. 4he rule is settled that any benefit and su le!ent being en3oyed by the e! loyees cannot be reduced, di!inished, discontinued or eli!inated by the e! loyer. 4he rinci le of non1di!inution of benefits is founded on the constitutional !andate to rotect the rights of "or%ers and to ro!ote their "elfare and to afford labor full rotection. Eastern ?elecommunications P*ilippines, Inc. vs. Eastern ?elecoms Employees Union, G.R. o. !%+""+, 2ebruary %, '#!'. +! loyee dis!issal$ constructi'e dis!issal. (n constructi'e dis!issal cases, the e! loyer has the burden of ro'ing that the transfer of an e! loyee is for 3ust or 'alid ground, such as genuine business necessity. 4he e! loyer !ust de!onstrate that the transfer is not unreasonable, incon'enient, or re3udicial to the e! loyee and that the transfer does not in'ol'e a de!otion in ran% or a di!inution in salary and other benefits. C(f the e! loyer fails to o'erco!e this burden of roof, the e! loyee)s transfer is tanta!ount to unla"ful constructi'e dis!issal.D M-erc% Shar and Doh!e .Phili ines0 '. /obles, 8./. :o. 1A>B0>, :o'e!ber 2B, 2006N Petitioners failed to satisfy the burden of ro'ing that the transfer "as based on 3ust or 'alid ground. Petitioners) bare assertions of i!!inent threat fro! the res ondents are !ere accusations "hich are not substantiated by any roof. 4he Su re!e Court agreed "ith the Court of A eals in ruling that the transfer of res ondents a!ounted to a de!otion. (ulieCs -a9es*op and/or Edgar Reyes vs. >enry Arnai@, et al., G.R. o. !6$%%', 2ebruary !+, '#!'. +! loyee dis!issal$ disease$ dereliction of duties. &ith regard to disease as a ground for ter!ination, Article 27E of the Labor Code ro'ides that an e! loyer !ay ter!inate the ser'ices of an e! loyee "ho has been found to be suffering fro! any disease and "hose continued e! loy!ent is rohibited by la" or is re3udicial to his health, as "ell as to the health of his co1 e! loyees. (n order to 'alidly ter!inate e! loy!ent on this ground, Section 7, /ule (, ;oo% F( of the *!nibus /ules (! le!enting the Labor Code re,uires that# .i0 the e! loyee be suffering fro! a disease and his continued e! loy!ent is rohibited by la" or re3udicial to his health or to the health of his co1e! loyees, and .ii0 a certification by a co! etent ublic health authority that the disease is of such nature or at such a stage that it cannot be cured "ithin a eriod of si2 .>0 !onths e'en "ith ro er !edical treat!ent. (f the disease or ail!ent can be cured "ithin the eriod, the e! loyer shall not ter!inate the e! loyee but shall as% the e! loyee to ta%e a lea'e. 4he e! loyer shall reinstate such e! loyee to his for!er osition i!!ediately u on the restoration of his nor!al health. (n ?riple Eig*t Integrated )ervices, Inc. v. 0R, 1G.R. :o. 126B7E, Dece!ber =, 16674, the Court held that the re,uire!ent for a !edical certificate under Article 27E of the Labor Code cannot be dis ensed "ith$ other"ise, it "ould sanction the unilateral and arbitrary deter!ination by the e! loyer of the gra'ity or e2tent of the e! loyee)s illness and, thus, defeat the ublic olicy on the rotection of labor. (n this case, Onson should ha'e re orted bac% to "or% or attended the in'estigations conducted by &uerth Phili ines, (nc. i!!ediately u on being er!itted to "or% by his doctors, %no"ing that his osition re!ained 'acant for a considerable length of ti!e. Ho"e'er, he did not e'en sho" any sincere effort to return to "or%. Clearly, since there is no !ore hindrance for hi! to return to "or% and attend the in'estigations set by &uerth Phili ines, (nc., Onson)s failure to do so "as "ithout any 'alid or 3ustifiable reason. His conduct sho"s his indifference and utter disregard of his "or% and his e! loyer)s interest, and dis lays his clear, deliberate, and gross dereliction of duties. 4he o"er to dis!iss an e! loyee is a recogni5ed rerogati'e inherent in the e! loyer)s right to freely !anage and regulate his business. 4he la", in rotecting the rights of the laborers, authori5es neither o ression nor self1destruction of the e! loyer. 4he "or%er)s

right to security of tenure is not an absolute right, for the la" ro'ides that he !ay be dis!issed for cause. As a general rule, e! loyers are allo"ed "ide latitude of discretion in ter!inating the e! loy!ent of !anagerial ersonnel. 4he !ere e2istence of a basis for belie'ing that such e! loyee has breached the trust and confidence of his e! loyer "ould suffice for his dis!issal. :eedless to say, an irres onsible e! loyee li%e Onson does not deser'e a osition in the "or% lace, and it is &uerth Phili ines, (nc.)s !anage!ent rerogati'e to ter!inate his e! loy!ent. 4o be sure, an e! loyer cannot be co! elled to continue "ith the e! loy!ent of "or%ers "hen continued e! loy!ent "ill ro'e ini!ical to the e! loyer)s interest. Auert* P*ilippines, Inc. vs. Rodante Enson, G.R. o. !6+&$', 2ebruary !+, '#!'. +! loyee dis!issal$ due rocess. &ith res ect to due rocess re,uire!ent, the e! loyer is bound to furnish the e! loyee concerned "ith t"o .20 "ritten notices before ter!ination of e! loy!ent can be legally effected. *ne is the notice a rising the e! loyee of the articular acts or o!issions for "hich his dis!issal is sought and this !ay loosely be considered as the ro er charge. 4he other is the notice infor!ing the e! loyee of the !anage!ent)s decision to se'er his e! loy!ent. 4his decision, ho"e'er, !ust co!e only after the e! loyee is gi'en a reasonable eriod fro! recei t of the first notice "ithin "hich to ans"er the charge, thereby gi'ing hi! a! le o ortunity to be heard and defend hi!self "ith the assistance of his re resentati'e should he so desire. 4he re,uire!ent of notice, it has been stressed, is not a !ere technicality but a re,uire!ent of due rocess to "hich e'ery e! loyee is entitled. Here, Palacio Del 8obernador Condo!iniu! Cor oration co! lied "ith the Ct"o1notice ruleD stated abo'e. )ebastian 2. <asay, (r. vs. Palacio del Gobernador ,ondominium ,orporation and <mar ?. ,ru@, G.R. o. !&8$#", 2ebruary ", '#!'. +! loyee dis!issal$ due rocess. Cityland did not afford 8alang the re,uired notice before he "as dis!issed. As the Court of A eals noted, the in'estigation conference 4u as called to loo% into the 3anitors) co! laints against 8alang did not constitute the "ritten notice re,uired by la" as he had no clear idea "hat the charges against hi! "ere. Romeo A. Galang vs. ,itiland )*aw ?ower, Inc. and /irgilio -aldemor, G.R. o. !6$'&!, 2ebruary %, '#!'. +! loyee dis!issal$ grounds. 4he 'alidity of an e! loyee)s dis!issal fro! ser'ice hinges on the satisfaction of the t"o substanti'e re,uire!ents for a la"ful ter!ination. 4hese are, first, "hether the e! loyee "as accorded due rocess the basic co! onents of "hich are the o ortunity to be heard and to defend hi!self. 4his is the rocedural as ect. And second, "hether the dis!issal is for any of the causes ro'ided in the Labor Code of the Phili ines. 4his constitutes the substanti'e as ect. *n the substanti'e as ect, the Su re!e Court found that Palacio Del 8obernador Condo!iniu! Cor oration)s ter!ination of the *asay)s e! loy!ent "as for a cause ro'ided under the Labor Code. (n ter!inating *asay)s e! loy!ent, Palacio Del 8obernador Condo!iniu! Cor oration in'o%ed loss of trust and confidence. 4he first re,uisite for dis!issal on the ground of loss of trust and confidence is that the e! loyee concerned !ust be holding a osition of trust and confidence. Here, it is indubitable that *asay holds a osition of trust and confidence. 4he osition of ;uilding Ad!inistrator, being !anagerial in nature, necessarily en3oys the trust and confidence of the e! loyer. 4he second re,uisite is that there !ust be an act that "ould 3ustify the loss of trust and confidence. Loss of trust and confidence, to be a 'alid cause for dis!issal, !ust be based on a "illful breach of trust and founded on clearly established facts. Palacio Del 8obernador Condo!iniu! Cor oration had established, by clear and con'incing e'idence, *asay)s acts "hich 3ustified its loss of trust and confidence on the for!er. )ebastian 2. <asay, (r. vs. Palacio del Gobernador ,ondominium ,orporation and <mar ?. ,ru@, G.R. o. !&8$#", 2ebruary ", '#!'.

+! loyee dis!issal$ 3ust cause. 4he Su re!e Court found that 8alang had beco!e unfit to continue his e! loy!ent. 4he e'idence su orts the 'ie" that he continued to e2hibit undesirable traits as an e! loyee and as a erson, in relation to both his co1"or%ers and his su eriors, articularly 4u as, her i!!ediate su er'isor. Quoting the Court of A eals) decision "ith a ro'al, the Su re!e Court held# C&ithout offering any ossible ill !oti'e that !ight ha'e i! elled Mthe res ondentsN to su!!arily dis!iss M8alangN, "ho ad!itted ha'ing been absorbed by the for!er as 3anitor u on the ter!ination of his contract "ith his agency, this Court is !ore inclined to gi'e credence to the e'idence ointing to the conclusion that M8alang)sN e! loy!ent "as actually se'ered for a 3ust cause.D Romeo A. Galang vs. ,itiland )*aw ?ower, Inc. and /irgilio -aldemor, G.R. o. !6$'&!, 2ebruary %, '#!'. +! loyer$ right to disci line e! loyee. (n Sagales '. /ustan)s Co!!ercial Cor oration .8./. :o. 1>>BBE, :o'e!ber 2A, 20070, the Su re!e Court ruled# 4ruly, "hile the e! loyer has the inherent right to disci line, including that of dis!issing its e! loyees, this rerogati'e is sub3ect to the regulation by the State in the e2ercise of its olice o"er. (n this regard, it is a hornboo% doctrine that in#ractions committed by an employee should merit only the corresponding penalty demanded by the circumstance$ %he penalty must be commensurate with the act& conduct or omission imputed to the employee and must be imposed in connection with the disciplinary authority o# the employer$ .+! hasis in the original.0 (n the case at bar, the enalty handed out by the etitioners "as the ulti!ate enalty of dis!issal. 4here "as no "arning or ad!onition for res ondent)s 'iolation of tea! rules, only outright ter!ination of his ser'ices for an act "hich could ha'e been unished a ro riately "ith a se'ere re ri!and or sus ension. egros )las*ers, Inc., Rodol5o ,. Alvare@ and /icente ?an vs. Alvin 0. ?eng, G.R. o. !%6!'', 2ebruary '', '#!'. +! loyer1e! loyee relationshi $ onus robandi. 4he onus probandi falls on etitioner to establish or substantiate such clai! by the re,uisite ,uantu! of e'idence. 4he issue of Ja'ier)s alleged illegal dis!issal is anchored on the e2istence of an e! loyer1e! loyee relationshi bet"een hi! and 9ly Ace. As the records bear out, the Labor Arbiter and the Court of A eals found Ja'ier)s clai! of e! loy!ent "ith 9ly Ace as "anting and deficient. Although Section 10, /ule F(( of the :e" /ules of Procedure of the :L/C allo"s a rela2ation of the rules of rocedure and e'idence in labor cases, this rule of liberality does not !ean a co! lete dis ensation of roof. Labor officials are en3oined to use reasonable !eans to ascertain the facts s eedily and ob3ecti'ely "ith little regard to technicalities or for!alities but no"here in the rules are they ro'ided a license to co! letely discount e'idence, or the lac% of it. 4he ,uantu! of roof re,uired, ho"e'er, !ust still be satisfied. Hence, C"hen confronted "ith conflicting 'ersions on factual !atters, it is for the! in the e2ercise of discretion to deter!ine "hich arty deser'es credence on the basis of e'idence recei'ed, sub3ect only to the re,uire!ent that their decision !ust be su orted by substantial e'idence.D M )alvador 0acorte v. >on. Amado G. Inciong, 2E7 Phil. 2=2 .16770N Accordingly, Ja'ier needs to sho" by substantial e'idence that he "as indeed an e! loyee of the co! any against "hich he clai!s illegal dis!issal. -itoy (avier 13anilo P. (avier4 vs. 2ly Ace ,orporation/2lordelyn ,astillo, G.R. o. !&'++%, 2ebruary !+, '#!'.

+! loyer1e! loyee relationshi $ test. 4o deter!ine the e2istence of an e! loyer1e! loyee relationshi , the follo"ing are considered# .10 the selection and engage!ent of the e! loyee$ .20 the ay!ent of "ages$ .=0 the o"er of dis!issal$ and .E0 the o"er to control the e! loyee)s conduct. *f these ele!ents, the !ost i! ortant criterion is "hether the e! loyer controls or has reser'ed the right to control the e! loyee not only as to the result of the "or% but also as to the !eans and !ethods by "hich the result is to be acco! lished. (n this case, Ja'ier "as not able to ersuade the Court that the abo'e ele!ents e2ist in his case. He could not sub!it co! etent roof that 9ly Ace engaged his ser'ices as a regular e! loyee$ that 9ly Ace aid his "ages as an e! loyee, or that 9ly Ace could dictate "hat his conduct should be "hile at "or%. (n other "ords, Ja'ier)s allegations did not establish that his relationshi "ith 9ly Ace had the attributes of an e! loyer1e! loyee relationshi on the basis of the abo'e1!entioned four1fold test. &orse, Ja'ier "as not able to refute 9ly Ace)s assertion that it had an agree!ent "ith a hauling co! any to underta%e the deli'ery of its goods. (t "as also baffling to reali5e that Ja'ier did not dis ute 9ly Ace)s denial of his ser'ices) e2clusi'ity to the co! any. (n short, all that Ja'ier laid do"n "ere bare allegations "ithout corroborati'e roof. -itoy (avier 13anilo P. (avier4 vs. 2ly Ace ,orporation/2lordelyn ,astillo, G.R. o. !&'++%, 2ebruary !+, '#!'. +! loy!ent contract$ stages. Contracts undergo three distinct stages, to "it# negotiation$ erfection or birth$ and consu!!ation. :egotiation begins fro! the ti!e the ros ecti'e contracting arties !anifest their interest in the contract and ends at the !o!ent of agree!ent of the arties. Perfection or birth of the contract ta%es lace "hen the arties agree u on the essential ele!ents of the contract. Consu!!ation occurs "hen the arties fulfill or erfor! the ter!s agreed u on in the contract, cul!inating in the e2tinguish!ent thereof. Gnder Article 1=1B of the Ci'il Code, a contract is erfected by !ere consent and fro! that !o!ent the arties are bound not only to the fulfill!ent of "hat has been e2 ressly sti ulated but also to all the conse,uences "hich, according to their nature, !ay be in %ee ing "ith good faith, usage and la". An e! loy!ent contract, li%e any other contract, is erfected at the !o!ent .10 the arties co!e to agree u on its ter!s$ and .20 concur in the essential ele!ents thereof# .a0 consent of the contracting arties, .b0 ob3ect certain "hich is the sub3ect !atter of the contract and .c0 cause of the obligation. (n the resent case, C.9. Shar , on behalf of its rinci al, (nternational Shi ing -anage!ent, (nc., hired Agustin and -ini!o as Sandblaster<Painter for a =1!onth contract, "ith a basic !onthly salary of GSREB0.00. 4hus, the ob3ect of the contract is the ser'ice to be rendered by Agustin and -ini!o on board the 'essel "hile the cause of the contract is the !onthly co! ensation they e2 ect to recei'e. 4hese ter!s "ere e!bodied in the Contract of +! loy!ent "hich "as e2ecuted by the arties. 4he agree!ent u on the ter!s of the contract "as !anifested by the consent freely gi'en by both arties through their signatures in the contract. :either arties disa'o" the consent they both 'oluntarily ga'e. 4hus, there is a erfected contract of e! loy!ent. ,.2. )*arp F ,o. Inc. and (o*n (. Roc*a vs. Pioneer Insurance and )urety ,orporation, et al., G.R. o. !6&8"&, 2ebruary !+, '#!'. +! loy!ent relationshi $ co!!ence!ent. 4he co!!ence!ent of an e! loyer1e! loyee relationshi !ust be treated se arately fro! the erfection of an e! loy!ent contract. )antiago v. ,2 )*arp ,rew Management, Inc., .8./. :o. 1>2E16, 10 July 200A0 is an instructi'e recedent on this oint. (n that case, the Su re!e Court !ade a distinction bet"een the erfection of the e! loy!ent contract and the co!!ence!ent of the e! loyer1e! loyee relationshi , thus# ?*e per5ection o5 t*e contract, w*ic* in t*is case coincided wit* t*e date o5 e7ecution t*ereo5, occurred w*en petitioner and respondent agreed on t*e obHect and t*e cause, as well as t*e rest o5 t*e terms and conditions t*erein. ?*e commencement o5 t*e employer.employee relations*ip,

as earlier discussed, would *ave ta9en place *ad petitioner been actually deployed 5rom t*e point o5 *ire. ?*us, even be5ore t*e start o5 any employer.employee relations*ip, contemporaneous wit* t*e per5ection o5 t*e employment contract was t*e birt* o5 certain rig*ts and obligations, t*e breac* o5 w*ic* may give rise to a cause o5 action against t*e erring party. Des ite the fact that the e! loyer1e! loyee relationshi has not co!!enced due to the failure to de loy Agustin and -ini!o in this case, Agustin and -ini!o are entitled to rights arising fro! the erfected Contract of +! loy!ent, such as the right to de!and erfor!ance by C.9. Shar of its obligation under the contract. ,.2. )*arp F ,o. Inc. and (o*n (. Roc*a vs. Pioneer Insurance and )urety ,orporation, et al., G.R. o. !6&8"&, 2ebruary !+, '#!'. 9oru! sho ing$ ele!ents$ res 3udicata. 9or foru! sho ing to e2ist, it is necessary that .a0 there be identity of arties or at least such arties that re resent the sa!e interests in both actions$ .b0 there be identity of rights asserted and relief rayed for, the relief being founded on the sa!e facts$ and .c0 the identity of the t"o receding articulars is such that any 3udg!ent rendered in one action "ill, regardless of "hich arty is successful, a!ount to res Hudicata in the other action. Petitioners are correct as to the first t"o re,uisites of foru! sho ing. 9irst, there is identity of arties in'ol'ed# :egros Slashers (nc. and res ondent 4eng. Second, there is identity of rights asserted i.e., the right of !anage!ent to ter!inate e! loy!ent and the right of an e! loyee against illegal ter!ination. Ho"e'er, the third re,uisite of foru! sho ing is !issing in this case. Any 3udg!ent or ruling of the *ffice of the Co!!issioner of the -etro olitan ;as%etball Association "ill not a!ount to res Hudicata. Res Hudicata is defined in 3uris rudence as to ha'e four basic ele!ents# .10 the 3udg!ent sought to bar the ne" action !ust be final$ .20 the decision !ust ha'e been rendered by a court ha'ing 3urisdiction o'er the sub3ect !atter and the arties$ .=0 the dis osition of the case !ust be a 3udg!ent on the !erits$ and .E0 there !ust be as bet"een the first and second action, identity of arties, sub3ect !atter, and causes of action. Here, although contractually authori5ed to settle dis utes, the *ffice of the Co!!issioner of the -etro olitan ;as%etball Association is not a court of co! etent 3urisdiction as conte! lated by la" "ith res ect to the a lication of the doctrine of res Hudicata. At best, the *ffice of the Co!!issioner of the -etro olitan ;as%etball Association is a ri'ate !ediator or go1bet"een as agreed u on by tea! !anage!ent and a layer in the -etro olitan ;as%etball Association Player)s Contract of +! loy!ent. Any 3udg!ent that the *ffice of the Co!!issioner of the -etro olitan ;as%etball Association !ay render "ill not result in a bar for see%ing redress in other legal 'enues. Hence, res ondent)s action of filing the sa!e co! laint in the /egional Arbitration ;ranch of the :L/C does not constitute foru! sho ing. egros )las*ers, Inc., Rodol5o ,. Alvare@ and /icente ?an vs. Alvin 0. ?eng, G.R. o. !%6!'', 2ebruary '', '#!'. Jurisdiction$ :L/C. (t is clear fro! the :L/C /ules of Procedure that a eals !ust be 'erified and certified against foru!1sho ing by the arties1in1interest the!sel'es. 4he ur ose of 'erification is to secure an assurance that the allegations in the leading are true and correct and ha'e been filed in good faith. (n the case at bar, the arties1in1interest are etitioner Salenga, as the e! loyee, and res ondent Clar% De'elo !ent Cor oration as the e! loyer. A cor oration can only e2ercise its o"ers and transact its business through its board of directors and through its officers and agents "hen authori5ed by a board resolution or its byla"s. 4he o"er of a cor oration to sue and be sued is e2ercised by the board of directors. 4he hysical acts of the cor oration, li%e the signing of docu!ents, can be erfor!ed only by natural ersons duly authori5ed for the ur ose by cor orate byla"s or by a s ecific act of the board. Absent the re,uisite board resolution, neither 4i!bol1/o!an nor Atty. -allari, "ho signed the -e!orandu! of A eal and Joint Affida'it of Declaration allegedly on behalf of res ondent cor oration, !ay be considered as the Ca ellantD and Ce! loyerD referred to by the :L/C

/ules of Procedure. As such, the :L/C had no 3urisdiction to entertain the a eal. Antonio -. )alenga, et al. vs. ,ourt o5 Appeals, et al., G.R. o. !68&8!, 2ebruary !, '#!'. Labor$ effect if rocedural due rocess not follo"ed but "ith a 'alid cause for ter!ination. (t is re,uired that the e! loyer furnish the e! loyee "ith t"o "ritten notices# .10 a "ritten notice ser'ed on the e! loyee s ecifying the ground or grounds for ter!ination, and gi'ing to said e! loyee reasonable o ortunity "ithin "hich to e2 lain his side$ and .20 a "ritten notice of ter!ination ser'ed on the e! loyee indicating that u on due consideration of all the circu!stances, grounds ha'e been established to 3ustify his ter!ination. 4he t"in re,uire!ents of notice and hearing constitute the ele!ents of due rocess in cases of e! loyee)s dis!issal. 4he re,uire!ent of notice is intended to infor! the e! loyee concerned of the e! loyer)s intent to dis!iss and the reason for the ro osed dis!issal. G on the other hand, the re,uire!ent of hearing affords the e! loyee an o ortunity to ans"er his e! loyer)s charges against hi! and accordingly, to defend hi!self therefro! before dis!issal is effected. *b'iously, the second "ritten notice, as indis ensable as the first, is intended to ensure the obser'ance of due rocess. (n this case, there "as only one "ritten notice "hich re,uired res ondents to e2 lain "ithin fi'e .B0 days "hy they should not be dis!issed fro! the ser'ice. Alco'endas "as the only one "ho signed the recei t of the notice. 4he others, as clai!ed by Lyn'il, refused to sign. 4he other e! loyees argue that no notice "as gi'en to the!. Des ite the inconsistencies, "hat is clear is that no final "ritten notice or notices of ter!ination "ere sent to the e! loyees. Due to the failure of Lyn'il to follo" the rocedural re,uire!ent of t"o1notice rule, no!inal da!ages in the a!ount of PB0,000 "ere granted to Ariola, et al. des ite their dis!issal for 3ust cause. 0ynvil 2is*ing Enterprises, Inc. vs. Andres G. Ariola, et al., G.R. o. !%!&68, 2ebruary !, '#!'. Labor$ liability of officers if ter!ination is attended "ith bad faith. (n labor cases, the cor orate directors and officers are solidarily liable "ith the cor oration for the ter!ination of e! loy!ent of e! loyees done "ith !alice or in bad faith. (ndeed, !oral da!ages are reco'erable "hen the dis!issal of an e! loyee is attended by bad faith or fraud or constitutes an act o ressi'e to labor, or is done in a !anner contrary to good !orals, good custo!s or ublic olicy. 4he ter! Cbad faithD conte! lates a Cstate of !ind affir!ati'ely o erating "ith furti'e design or "ith so!e !oti'e of self1interest or "ill or for ulterior ur ose.D 4he Su re!e Court agreed "ith the ruling of both the :L/C and the Court of A eals "hen they ronounced that there "as no e'idence on record that indicates co!!ission of bad faith on the art of De ;or3a, the general !anager of Lyn'il, "ho "as tas%ed "ith the su er'ision of the e! loyees and the o eration of the business. 4here is no roof that he i! osed on Ariola, et al. the C por viaHeD ro'ision for ur ose of effecting their su!!ary dis!issal. 0ynvil 2is*ing Enterprises, Inc. vs. Andres G. Ariola, et al., G.R. o. !%!&68, 2ebruary !, '#!'. Labor$ nature of e! loy!ent$ security of tenure. (n the conte2t of these facts S .10 Ariola, et al. "ere doing tas%s necessary to Lyn'il)s fishing business "ith ositions ranging fro! ca tain of the 'essel to bodegero$ .20 after the end of a tri , they "ill again be hired for another tri "ith ne" contracts$ and .=0 this arrange!ent continued for !ore than ten years ? the Court belie'ed that Lyn'il intended to go around the security of tenure of Ariola, et al. as regular e! loyees. 4he Court held that by the e2 ress ro'isions of the second aragra h of Article 270 "hich co'er casual e! loy!ent, Ariola, et al. had beco!e regular e! loyees of Lyn'il. 0ynvil 2is*ing Enterprises, Inc. vs. Andres G. Ariola, et al., G.R. o. !%!&68, 2ebruary !, '#!'. Labor$ rocedural and substanti'e due rocess$ grounds for 'alid ter!ination$ breach of trust. Just cause is re,uired for a 'alid dis!issal. 4he Labor Code ro'ides that an e! loyer !ay ter!inate an e! loy!ent based on fraud or "illful breach of the trust re osed on the e! loyee.

Such breach is considered "illful if it is done intentionally, %no"ingly, and ur osely, "ithout 3ustifiable e2cuse, as distinguished fro! an act done carelessly, thoughtlessly, heedlessly or inad'ertently. (t !ust also be based on substantial e'idence and not on the e! loyer)s "hi!s or ca rices or sus icions other"ise, the e! loyee "ould eternally re!ain at the !ercy of the e! loyer. Loss of confidence !ust not be indiscri!inately used as a shield by the e! loyer against a clai! that the dis!issal of an e! loyee "as arbitrary. And, in order to constitute a 3ust cause for dis!issal, the act co! lained of !ust be "or%1related and sho"s that the e! loyee concerned is unfit to continue "or%ing for the e! loyer. (n addition, loss of confidence as a 3ust cause for ter!ination of e! loy!ent is re!ised on the fact that the e! loyee concerned holds a osition of res onsibility, trust and confidence or that the e! loyee concerned is entrusted "ith confidence in delicate !atters, such as the handling or care and rotection of the ro erty and assets of the e! loyer. 4he betrayal of this trust is the essence of the offense for "hich an e! loyee is enali5ed. 4he Su re!e Court found that breach of trust is resent in this case, "hen Ariola .the ca tain0, Alco'endas .Chief -ate0, Calinao .Chief +ngineer0, :ubla .coo%0, ;aTe5 .oiler0, and Sebullen .bodegero0 cons ired "ith one another and stole C pampanoD and CtangigueD fish and deli'ered the! to another 'essel, to the re3udice of Lyn'il. 0ynvil 2is*ing Enterprises, Inc. vs. Andres G. Ariola, et al., G.R. o. !%!&68, 2ebruary !, '#!'. Labor$ ublic rosecutor)s decision not binding on the labor tribunal. 4he Su re!e Court has held in icolas v. ational 0abor Relations ,ommission I=2A Phil. 77=, 77>177A .166>0N that a cri!inal con'iction is not necessary to find 3ust cause for e! loy!ent ter!ination. *ther"ise stated, an e! loyee)s ac,uittal in a cri!inal case, es ecially one that is grounded on the e2istence of reasonable doubt, "ill not reclude a deter!ination in a labor case that he is guilty of acts ini!ical to the e! loyer)s interests. (n the re'erse, the finding of robable cause is not follo"ed by auto!atic ado tion of such finding by the labor tribunals. (n other "ords, "hiche'er "ay the ublic rosecutor dis oses of a co! laint, the finding does not bind the labor tribunal. Lyn'il contends that the filing of a cri!inal case before the *ffice of the Prosecutor is sufficient basis for a 'alid ter!ination of e! loy!ent based on serious !isconduct and<or loss of trust and confidence. 4he Su re!e Court held that Lyn'il cannot argue that since the *ffice of the Prosecutor found robable cause for theft, the Labor Arbiter !ust follo" the finding as a 'alid reason for the ter!ination of res ondents) e! loy!ent. 4he roof re,uired for ur oses that differ fro! one and the other are li%e"ise different. 0ynvil 2is*ing Enterprises, Inc. vs. Andres G. Ariola, et al., G.R. o. !%!&68, 2ebruary !, '#!'. Labor$ regular e! loyee$ fi2ed1contract agree!ent, re,uisites for 'alidity. Prior Su re!e Court decisions ha'e laid t"o conditions for the 'alidity of a fi2ed1contract agree!ent bet"een the e! loyer and e! loyee# 2irst, the fi2ed eriod of e! loy!ent "as %no"ingly and 'oluntarily agreed u on by the arties "ithout any force, duress, or i! ro er ressure being brought to bear u on the e! loyee and absent any other circu!stances 'itiating his consent$ or )econd, it satisfactorily a ears that the e! loyer and the e! loyee dealt "ith each other on !ore or less e,ual ter!s "ith no !oral do!inance e2ercised by the for!er or the latter. Lyn'il contends that Ariola, et al. "ere e! loyed under a fi2ed1ter! contract "hich e2 ired at the end of the 'oyage. Contrarily, Ariola, et al. contend that they beca!e regular e! loyees by reason of their continuous hiring and erfor!ance of tas%s necessary and desirable in the usual trade and business of Lyn'il. 4e2tually, the ro'ision in the contract bet"een Lyn'il and Ariola, et al. that# : A a9o ay sumasang.ayon na magling9od at gumawa ng mga gawain sang.ayon sa pata9arang :por viaHe; na magmumula sa pagalis sa avotas papunta sa pangisdaan at pagbabali9 sa pondo*an ng lantsa sa avotas, Metro Manila; is for a fi2ed eriod of e! loy!ent. (n the conte2t, ho"e'er, of the facts that# .10 Ariola, et al. "ere doing tas%s necessarily to Lyn'il)s fishing business "ith ositions ranging fro! ca tain of the 'essel to

bodegero$ .20 after the end of a tri , they "ill again be hired for another tri "ith ne" contracts$ and .=0 this arrange!ent continued for !ore than ten years, the clear intention is to go around the security of tenure of Ariola, et al. as regular e! loyees. As such, the Su re!e Court found that Ariola, et al. are regular e! loyees. 0ynvil 2is*ing Enterprises, Inc. vs. Andres G. Ariola, et al., G.R. o. !%!&68, 2ebruary !, '#!'. Labor Code$ !a2i!u! a"ard of attorney)s fees in cases of reco'ery of "ages. Article 111 of the Labor Code ro'ides for a !a2i!u! a"ard of attorney)s fees in cases of reco'ery of "ages# a. (n cases of unla"ful "ithholding of "ages, the cul able arty !ay be assessed attorney)s fees e,ui'alent to ten ercent of the a!ount of "ages reco'ered. b. (t shall be unla"ful for any erson to de!and or acce t, in any 3udicial or ad!inistrati'e roceedings for the reco'ery of "ages, attorney)s fees "hich e2ceed ten ercent of the a!ount of "ages reco'ered. Since De 8racia, et al. had to secure the ser'ices of the la"yer to reco'er their un aid salaries and rotect their interest, attorney)s fees in the a!ount of ten ercent .10H0 of the total clai!s "as i! osed. )9ippers United Paci5ic, Inc. and )9ippers Maritime )ervices, Inc. 0td. vs. at*aniel 3o@a, et al., G.R. o. !6+++%. 2ebruary %, '#!'. Labor contracting$ ele!ents. 4here is labor1only contracting "here# .a0 the erson su lying "or%ers to an e! loyer does not ha'e substantial ca ital or in'est!ent in the for! of tools, e,ui !ent, !achineries, "or% re!ises, a!ong others$ and .b0 the "or%ers recruited and laced by such erson are erfor!ing acti'ities "hich are directly related to the rinci al business of the e! loyer. (n the resent case, the Su re!e Court found that both the ca itali5ation re,uire!ent and the o"er of control on the art of /e,uiTo are "anting. 8enerally, the resu! tion is that the contractor is a labor1only contractor unless such contractor o'erco!es the burden of ro'ing that it has the substantial ca ital, in'est!ent, tools and the li%e. (n the resent case, though 8arden of -e!ories is not the contractor, it has the burden of ro'ing that /e,uiTo has sufficient ca ital or in'est!ent since it is clai!ing the su osed status of /e,uiTo as inde endent contractor. 8arden of -e!ories, ho"e'er, failed to adduce e'idence ur orting to sho" that /e,uiTo had sufficient ca itali5ation. :either did it sho" that she in'ested in the for! of tools, e,ui !ent, !achineries, "or% re!ises and other !aterials "hich are necessary in the co! letion of the ser'ice contract. Garden o5 Memories Par9 and 0i5e Plan, Inc., et al. vs. 0R,, 'nd 3iv., et al., G.R. o. !"#'6%, 2ebruary %, '#!'. -igrant &or%ers$ /A :o. 70E2$ !oney clai!s in cases of un3ust ter!ination. Section 10 of /e ublic Act :o. 70E2 .-igrant &or%ers Act0 ro'ides for !oney clai!s in cases of un3ust ter!ination of e! loy!ent contracts# (n case of ter!ination of o'erseas e! loy!ent "ithout 3ust, 'alid or authori5ed cause as defined by la" or contract, the "or%ers shall be entitled to the full rei!burse!ent of his lace!ent fee "ith interest of t"el'e ercent .12H0 er annu!, lus his salaries for the une2 ired ortion of his e! loy!ent contract or for three .=0 !onths for e'ery year of the une2 ired ter!, "hiche'er is less. 4he -igrant &or%ers Act ro'ides that salaries for the une2 ired ortion of the e! loy!ent contract or three .=0 !onths for e'ery year of the une2 ired ter!, "hiche'er is less, shall be a"arded to the o'erseas 9ili ino "or%er, in cases of illegal dis!issal. Ho"e'er, in 2E -arch

2006, )errano v. Gallant Maritime )ervices and Marlow avigation ,o. Inc. .8./. :o. 1>A>1E0, the Court, in an +n ;anc Decision, declared unconstitutional the clause Cor for three !onths for e'ery year of the une2 ired ter!, "hiche'er is lessD and a"arded the entire une2 ired ortion of the e! loy!ent contract to the o'erseas 9ili ino "or%er. *n 7 -arch 2010, ho"e'er, Section A of /e ublic Act :o. 10022 ./A 100220 a!ended Section 10 of the -igrant &or%ers Act, and once again reiterated the ro'ision of a"arding the une2 ired ortion of the e! loyent contract or three .=0 !onths for e'ery year of the une2 ired ter!, "hiche'er is less. :e'ertheless, since the ter!ination occurred on January 1666 before the assage of the a!endatory /A 10022, the Su re!e Court a lied /A 70E2, "ithout touching on the constitutionality of Section A of /A 10022. 4he declaration in -arch 2006 of the unconstitutionality of the clause Cor for three !onths for e'ery year of the une2 ired ter!, "hiche'er is lessD in /A 70E2 shall be gi'en retroacti'e effect to the ter!ination that occurred in January 1666 because an unconstitutional clause in the la" confers no rights, i! oses no duties and affords no rotection. 4he unconstitutional ro'ision is ino erati'e, as if it "as not assed into la" at all. )9ippers United Paci5ic, Inc. and )9ippers Maritime )ervices, Inc. 0td. vs. at*aniel 3o@a, et al., G.R. o. !6+++%. 2ebruary %, '#!'. :L/C$ conte! t o"ers. Gnder Article 217 the Labor Code, the :L/C .and the labor arbiters0 !ay hold any offending arty in conte! t, directly or indirectly, and i! ose a ro riate enalties in accordance "ith la". 4he enalty for direct conte! t consists of either i! rison!ent or fine, the degree or a!ount de ends on "hether the conte! t is against the Co!!ission or the labor arbiter. 4he Labor Code, ho"e'er, re,uires the labor arbiter or the Co!!ission to deal "ith indirect conte! t in the !anner rescribed under /ule A1 of the /ules of Court. /ule A1 of the /ules of Court does not re,uire the labor arbiter or the :L/C to initiate indirect conte! t roceedings before the trial court. 4his !ode is to be obser'ed only "hen there is no la" granting the! conte! t o"ers. As is clear under Article 217.d0 of the Labor Code, the labor arbiter or the Co!!ission is e! o"ered or has 3urisdiction to hold the offending arty or arties in direct or indirect conte! t. /obosa, et al., therefore, ha'e not i! ro erly brought the indirect conte! t charges against the res ondents before the :L/C. 2ederico ). Robosa, et al. vs. ational 0abor Relations ,ommission 12irst 3ivision4, et al., G.R. o. !6"#%+, 2ebruary %, '#!'. :L/C$ factual findings. (t is a "ell1entrenched rule that findings of facts of the :L/C, affir!ing those of the Labor Arbiter, are accorded res ect and due consideration "hen su orted by substantial e'idence. 4he Su re!e Court, ho"e'er, found that the doctrine of great res ect and finality has no a lication to the case at bar. 4he Labor Arbiter dis!issed Arnai5, et al.)s co! laints on !ere technicality. 4he :L/C, u on a eal, then ca!e u "ith three di'ergent rulings. At first, it re!anded the case to the Labor Arbiter. Ho"e'er, in a subse,uent resolution, it decided to resol'e the case on the !erits by ruling that Arnai5, et al. "ere constructi'ely dis!issed. ;ut later on, it again re'ersed itself in its third and final resolution of the case and ruled in fa'or of Julie)s ba%esho . 4herefore, contrary to /eyes)s clai!, the :L/C did not, on any occasion, affir! any factual findings of the Labor Arbiter. 4he Court of A eals is thus correct in re'ie"ing the entire records of the case to deter!ine "hich findings of the :L/C is sound and in accordance "ith la". ;esides, the Court of A eals !ay still resol'e factual issues by e2 ress !andate of the la" des ite the res ect gi'en to ad!inistrati'e findings of fact. (ulieCs -a9es*op and/or Edgar Reyes vs. >enry Arnai@, et al., G.R. o. !6$%%', 2ebruary !+, '#!'. Probationary e! loyee$ 'alid cause for dis!issal but "ithout rocedural due rocess$ e! loyee entitled to no!inal da!ages. Section 2, /ule (, ;oo% F( of the Labor Code)s (! le!enting /ules and /egulations ro'ides# CI5 t*e termination is broug*t about by t*e completion o5 a

contract or p*ase t*ereo5, or by 5ailure o5 an employee to meet t*e standards o5 t*e employer in t*e case o5 probationary employment, it s*all be su55icient t*at a written notice is served t*e employee wit*in a reasonable time 5rom t*e e55ective date o5 termination. D Dalangin "as hired by Canadian * ortunities as (!!igration and Legal -anager, sub3ect to a robationary eriod of si2 !onths. *ne !onth after hiring Dalangin, the co! any ter!inated his e! loy!ent, declaring hi! CunfitD and Cun,ualifiedD to continue as (!!igration and Legal -anager, for reasons "hich included obstinacy and utter disregard of co! any olicies. Pro ensity to ta%e rolonged and e2tended lunch brea%s, sho"s no interest in fa!iliari5ing oneself "ith the olicies and ob3ecti'es, lac% of concern for the co! any)s interest des ite ha'ing 3ust been e! loyed in the co! any .Declined to attend co! any s onsored acti'ities, se!inars intended to fa!iliari5e co! any e! loyees "ith -anage!ent ob3ecti'es and enhance!ent of co! any interest and ob3ecti'es0, lac% of enthusias! to"ard "or%, and lac% of interest in fostering relationshi "ith his co1e! loyees. 4he co! any contends that it co! lied "ith the rule on rocedural due rocess "hen it as%ed Dalangin, through a -e!orandu!, to e2 lain "hy he could not attend the se!inar. &hen he failed to sub!it his e2 lanation, the co! any ser'ed hi! a notice the follo"ing day ter!inating his e! loy!ent. According to the Su re!e Court, the notice to Dalangin "as not ser'ed "ithin a reasonable ti!e fro! the effecti'e date of his ter!ination as re,uired by the rules since he "as dis!issed on the 'ery day the notice "as gi'en to hi!. Ho"e'er, because of the e2istence of a 'alid cause for ter!ination, the Su re!e Court did not in'alidate his dis!issal but enali5ed the co! any for its non1co! liance "ith the notice re,uire!ent, and ordered the co! any to ay an inde!nity, in the for! of no!inal da!ages a!ounting to P10,000. ,anadian <pportunities Unlimited, Inc. vs. -art B. 3alangin, (r., G.R. o. !6'''$, 2ebruary ", '#!'. Probationary e! loyee$ 'alid dis!issal e'en before > !onths. 4he essence of a robationary eriod of e! loy!ent funda!entally lies in the ur ose or ob3ecti'e of both the e! loyer and the e! loyee during the eriod. &hile the e! loyer obser'es the fitness, ro riety and efficiency of a robationer to ascertain "hether he is ,ualified for er!anent e! loy!ent, the latter see%s to ro'e to the for!er that he has the ,ualifications to !eet the reasonable standards for er!anent e! loy!ent. 4he Ctrial eriodD or the length of ti!e the robationary e! loyee re!ains on robation de ends on the arties) agree!ent, but it shall not e2ceed si2 .>0 !onths under Article 271 of the Labor Code. 4he Su re!e Court found substantial e'idence indicating that the co! any "as 3ustified in ter!inating Dalangin)s robationary e! loy!ent. Dalangin ad!itted in co! ulsory arbitration that the ro2i!ate cause for his dis!issal "as his refusal to attend the co! any)s CFalues 9or!ation Se!inarD scheduled for *ctober 2A, 2001, a Saturday. He refused to attend the se!inar after he learned that it had no relation to his duties, as he clai!ed, and that he had to lea'e at 2#00 .!. because he "anted to be "ith his fa!ily in the ro'ince. &hen the Chief * erations *fficer, insisted that he attend the se!inar to encourage his co1e! loyees to attend, he stood at on not attending, arguing that !ar%ed differences e2ist bet"een their ositions and duties, and insinuating that he did not "ant to 3oin the other e! loyees. He also ,uestioned the scheduled 2#00 .!. se!inars on Saturdays as they "ere not su osed to be doing a co! any acti'ity beyond 2#00 .!. He considers 2#00 .!. as the close of "or%ing hours on Saturdays$ thus, holding the! beyond 2#00 .!. "ould be in 'iolation of the la". 4his incident re'eals Dalangin)s lac% of interest in establishing a good "or%ing relationshi "ith his co1e! loyees, es ecially the ran% and file$ he did not "ant to 3oin the! because of his 'ie" that the se!inar "as not rele'ant to his osition and duties. (t also betrays his arrogant and condescending attitude to"ards his co1e! loyees, and a lac% of su ort for the co! any ob3ecti'e. Dalangin also e2hibited negati'e "or%ing habits, articularly "ith res ect to the one hour lunch brea% olicy of the co! any and the obser'ance of the co! any)s "or%ing hours. Dalangin "ould ta%e rolonged lunch brea%s or "ould go out of the office ? "ithout lea'e of the

co! any ? and call the ersonnel !anager later only to say that he "ould be unable to return to the office because of so!e ersonal !atters he needs to attend to. ,anadian <pportunities Unlimited, Inc. vs. -art B. 3alangin, (r., G.R. o. !6'''$, 2ebruary ", '#!'. Procedural rules$ liberal a lication. *rdinarily, rules of rocedure are strictly enforced by courts in order to i! art stability in the legal syste!. Ho"e'er, in not a fe" instances, the Su re!e Court has rela2ed the rigid a lication of the rules of rocedure to afford the arties the o ortunity to fully 'entilate their cases on the !erits. 4his is in line "ith the ti!e honored rinci le that cases should be decided only after gi'ing all the arties the chance to argue their causes and defenses. (n that "ay, the ends of 3ustice "ould be better ser'ed. 9or indeed, the general ob3ecti'e of rocedure is to facilitate the a lication of 3ustice to the ri'al clai!s of contending arties, bearing al"ays in !ind that rocedure is not to hinder but to ro!ote the ad!inistration of 3ustice. (n *ng Li! Sing, Jr. '. 9+; Leasing and 9inance Cor oration .8./. :o. 1>711B, June 7, 200A0, the Su re!e Court ruled# Courts ha'e the rerogati'e to rela2 rocedural rules of e'en the !ost !andatory character, !indful of the duty to reconcile both the need to s eedily ut an end to litigation and the arties) right to due rocess. (n nu!erous cases, this Court has allo"ed liberal construction of the rules "hen to do so "ould ser'e the de!ands of substantial 3ustice and e,uity. 2 2 2 (ndeed the re'ailing trend is to accord arty litigants the a! lest o ortunity for the ro er and 3ust deter!ination of their causes, free fro! the constraints of needless technicalities. (n this case, besides the fact that a denial of the recourse to the Court of A eals "ould ser'e !ore to er etuate an in3ustice and 'iolation of 4eng)s rights under our labor la"s, the Su re!e Court found that as correctly held by the Court of A eals, no intent to delay the ad!inistration of 3ustice could be attributed to 4eng. 4he Court of A eals therefore did not co!!it re'ersible error in e2cusing 4eng)s one1day delay in filing his !otion for reconsideration and in gi'ing due course to his etition for certiorari. egros )las*ers, Inc., Rodol5o ,. Alvare@ and /icente ?an vs. Alvin 0. ?eng, G.R. o. !%6!'', 2ebruary '', '#!'. /einstate!ent$ bac%"ages. +! loyees "ho are illegally dis!issed are entitled to full bac%"ages, inclusi'e of allo"ances and other benefits or their !onetary e,ui'alent, co! uted fro! the ti!e their actual co! ensation "as "ithheld fro! the! u to the ti!e of their actual reinstate!ent. ;ut if reinstate!ent is no longer ossible, the bac%"ages shall be co! uted fro! the ti!e of their illegal ter!ination u to the finality of the decision. 4hus, "hen there is an order of reinstate!ent, the co! utation of bac%"ages shall be rec%oned fro! the ti!e of illegal dis!issal u to the ti!e that the e! loyee is actually reinstated to his for!er osition. Pursuant to the order of reinstate!ent rendered by the Labor Arbiter, the ;an% of Lubao sent -anabat a letter re,uiring hi! to re ort bac% to "or% on -ay E, 200A. :ot"ithstanding the said letter, -anabat o ted not to re ort for "or%. 4hus, it is but fair that the bac%"ages to be a"arded to -anabat should be co! uted fro! the ti!e that he "as illegally dis!issed until the ti!e "hen he "as re,uired to re ort for "or%, i.e. fro! Se te!ber 1, 200B until -ay E, 200A. -an9 o5 0ubao, Inc. vs. Rommel (. Manabat, et al., G.R. o. !%%6'', 2ebruary !, '#!'. /einstate!ent$ doctrine of strained relations$ "hen a licable. Gnder the la" and re'ailing 3uris rudence, an illegally dis!issed e! loyee is entitled to reinstate!ent as a !atter of right. Ho"e'er, if reinstate!ent "ould only e2acerbate the tension and strained relations bet"een the arties, or "here the relationshi bet"een the e! loyer and the e! loyee has been unduly strained by reason of their irreconcilable differences, particularly w*ere t*e illegally dismissed employee *eld a managerial or 9ey position in t*e company , it "ould be !ore rudent to order

ay!ent of se aration ay instead of reinstate!ent. Gnder the doctrine o5 strained relations, the ay!ent of se aration ay is considered an acce table alternati'e to reinstate!ent "hen the latter o tion is no longer desirable or 'iable. *n one hand, such ay!ent liberates the e! loyee fro! "hat could be a highly o ressi'e "or% en'iron!ent. *n the other hand, it releases the e! loyer fro! the grossly un alatable obligation of !aintaining in its e! loy a "or%er it could no longer trust. (n such cases, it should be ro'ed that the e! loyee concerned occu ies a osition "here he en3oys the trust and confidence of his e! loyer$ and that it is li%ely that if reinstated, an at!os here of anti athy and antagonis! !ay be generated as to ad'ersely affect the efficiency and roducti'ity of the e! loyee concerned. (n the resent case, the Su re!e Court found that the relations bet"een the arties had been already strained thereby 3ustifying the grant of se aration ay in lieu of reinstate!ent in fa'or of -anabat. -anabat)s reinstate!ent to his for!er osition "ould only ser'e to intensify the at!os here of anti athy and antagonis! bet"een the arties. Gndoubtedly, ;an% of Lubao)s filing of 'arious cri!inal co! laints against -anabat for ,ualified theft and the subse,uent filing by the latter of the co! laint for illegal dis!issal against the for!er, ta%en together "ith the endency of the instant case for !ore than si2 years, had caused strained relations bet"een the arties. Considering that -anabat)s for!er osition as ban% encoder in'ol'es the handling of accounts of the de ositors of the ;an% of Lubao, it "ould not be e,uitable on the art of the ;an% of Lubao to be ordered to !aintain the for!er in its e! loy since it !ay only ins ire 'indicti'eness on the art of -anabat. Also, the refusal of -anabat to return to "or% is in itself an indication of the e2istence of strained relations bet"een hi! and the etitioner. -an9 o5 0ubao, Inc. vs. Rommel (. Manabat, et al., G.R. o. !%%6'', 2ebruary !, '#!'. Seafarers$ e! loy!ent contract$ erfection stage 's. co!!ence!ent stage. An e! loy!ent contract, li%e any other contract, is erfected at the !o!ent .10 the arties co!e to agree u on its ter!s$ and .20 concur in the essential ele!ents thereof# .a0 consent of the contracting arties, .b0 ob3ect certain "hich is the sub3ect !atter of the contract, and .c0 cause of the obligation. 4he ob3ect of the contract "as the rendition of ser'ice by 9antonial on board the 'essel for "hich ser'ice he "ould be aid the salary agreed u on. (n this case, the e! loy!ent contract "as erfected on January 1B, 2000 "hen it "as signed by the arties "ho entered into the contract in behalf of their rinci al. Ho"e'er, the e! loy!ent relationshi ne'er co!!enced since 9antonial "as not allo"ed to lea'e on January 1A, 2000 and go on board the 'essel -<F AGI in 8er!any on the ground that he "as not yet declared fit to "or% on the day of his scheduled de arture. ;ut, e'en if no e! loyer1e! loyee relationshi co!!enced, there "as, conte! oraneous "ith the erfection of the e! loy!ent contract, the birth of certain rights and obligations, the breach of "hich !ay gi'e rise to a cause of action against the erring arty. -rig*t Maritime ,orporation 1-M,4 / 3esiree P. ?enorio vs. Ricardo -. 2antonial, G.R. o. !"+&$+, 2ebruary %, '#!'.

"ebruary 2012 Philippine Supreme Court Decisions on Labor Law and Procedure
Posted on -arch B, 2012 by Leslie C. Dy Here are select 9ebruary 2012 rulings of the Su re!e Court on labor la" and rocedure# A eal$ factual finding of :L/C. 9indings of fact of ad!inistrati'e agencies and ,uasi13udicial bodies, "hich ha'e ac,uired e2 ertise because their 3urisdiction is confined to s ecific !atters,

are generally accorded not only res ect but finality "hen affir!ed by the Court of A eals. 9actual findings of ,uasi13udicial bodies li%e the :L/C, if su orted by substantial e'idence, are accorded res ect and e'en finality by the Su re!e Court, !ore so "hen they coincide "ith those of the Labor Arbiter. Such factual findings are gi'en !ore "eight "hen the sa!e are affir!ed by the Court of A eals. (n the resent case, the Su re!e Court found no reason to de art fro! these rinci les since the Labor Arbiter found that there "as substantial e'idence to conclude that *asay had breached the trust and confidence of Palacio Del 8obernador Condo!iniu! Cor oration, "hich finding the :L/C had li%e"ise u held. )ebastian 2. <asay, (r. vs. Palacio del Gobernador ,ondominium ,orporation and <mar ?. ,ru@, G.R. o. !&8$#", 2ebruary ", '#!'. Ci'il Ser'ice$ Clar% De'elo !ent Cor oration. Clar% De'elo !ent Cor oration .CDC0 o"es its e2istence to +2ecuti'e *rder :o. 70 issued by then President 9idel F. /a!os. (t "as !eant to be the i! le!enting and o erating ar! of the ;ases Con'ersion and De'elo !ent Authority tas%ed to !anage the Clar% S ecial +cono!ic Pone. +2 ressly, CDC "as for!ed in accordance "ith Phili ine cor oration la"s and e2isting rules and regulations ro!ulgated by the Securities and +2change Co!!ission ursuant to Section 1> of /e ublic Act A22A. CDC, a go'ern!ent o"ned or controlled cor oration "ithout an original charter, "as incor orated under the Cor oration Code. Pursuant to Article (K1;, Sec. 2.10 of the Constitution, the ci'il ser'ice e!braces only those go'ern!ent o"ned or controlled cor orations "ith original charter. As such, CDC and its e! loyees are co'ered by the Labor Code and not by the Ci'il Ser'ice La". Antonio -. )alenga, et al. vs. ,ourt o5 Appeals, et al., G.R. o. !68&8!, 2ebruary !, '#!'.
Memorize Article 285

Dis!issal$ resignation 's. illegal dis!issal$ tele2 is not e,ui'alent to tender of resignation. Article 27B of the Labor Code recogni5es ter!ination by the e! loyee of the e! loy!ent contract by Cser'ing "ritten notice on the e! loyer at least one .10 !onth in ad'ance.D 8i'en that ro'ision, the la" conte! lates the re,uire!ent of a "ritten notice of resignation. (n the absence of a "ritten resignation, it is safe to resu!e that the e! loyer ter!inated the seafarers. (n this case, the Su re!e Court found the dis!issal of De 8racia, et al. to be illegal since Cos!oshi !erely sent a tele2 to S%i ers, the local !anning agency, clai!ing that De 8racia, et al. "ere re atriated because the latter 'oluntarily re1ter!inated their contracts. )9ippers United Paci5ic, Inc. and )9ippers Maritime )ervices, Inc. 0td. vs. at*aniel 3o@a, et al., G.R. o. !6+++%. 2ebruary %, '#!'. Dis!issal$ substanti'e and rocedural due rocess. 9or a "or%er)s dis!issal to be considered 'alid, it !ust co! ly "ith both rocedural and substanti'e due rocess. 4he legality of the !anner of dis!issal constitutes rocedural due rocess, "hile the legality of the act of dis!issal constitutes substanti'e due rocess. Procedural due rocess in dis!issal cases consists of the t"in re,uire!ents of notice and hearing. 4he e! loyer !ust furnish the e! loyee "ith t"o "ritten notices before the ter!ination of e! loy!ent can be effected# .10 the first notice a rises the e! loyee of the articular acts or o!issions for "hich his dis!issal is sought$ and .20 the second notice infor!s the e! loyee of the e! loyer)s decision to dis!iss hi!. ;efore the issuance of the second notice, the re,uire!ent of a hearing !ust be co! lied "ith by gi'ing the "or%er an o ortunity to be heard. (t is not necessary that an actual hearing be conducted. Substanti'e due rocess, on the other hand, re,uires that dis!issal by the e! loyer be !ade based on a 3ust or authori5ed cause under Articles 272 to 27E of the Labor Code. (n this case, there "as no "ritten notice furnished to De 8racia, et al. regarding the cause of their dis!issal. Cos!oshi furnished a tele2 to S%i ers, the local !anning agency, clai!ing that De 8racia, et al. "ere re atriated because they 'oluntarily re1ter!inated their contracts. 4his tele2 "as gi'en credibility and "eight by the Labor Arbiter and :L/C in deciding that there "as re1ter!ination

of the e! loy!ent contract Ca%in to resignationD and no illegal dis!issal. Ho"e'er, as correctly ruled by the CA, the tele2 !essage is Ca biased and self1ser'ing docu!ent that does not satisfy the re,uire!ent of substantial e'idence.D (f, indeed, De 8racia, et al. 'oluntarily re1ter!inated their contracts, then De 8racia, et al. should ha'e sub!itted their "ritten resignations. )9ippers United Paci5ic, Inc. and )9ippers Maritime )ervices, Inc. 0td. vs. at*aniel 3o@a, et al., G.R. o. !6+++%. 2ebruary %, '#!'. +! loyee benefits$ right to bonus$ di!inution. 9ro! a legal oint of 'ie", a bonus is a gratuity or act of liberality of the gi'er "hich the reci ient cannot de!and as a !atter of right. 4he grant of a bonus is basically a !anage!ent rerogati'e "hich cannot be forced u on the e! loyer "ho !ay not be obliged to assu!e the onerous burden of granting bonuses. Ho"e'er, a bonus beco!es a de!andable or enforceable obligation if the additional co! ensation is granted "ithout any conditions i! osed for its ay!ent. (n such case, the bonus is treated as art of the "age, salary or co! ensation of the e! loyee. Particularly instructi'e is the ruling of the Court in Metro ?ransit <rgani@ation, Inc. v. ational 0abor Relations ,ommission .8./. :o. 11>007, July 11, 166B0 "here the Court said# &hether or not a bonus for!s art of "ages de ends u on the circu!stances and conditions for its ay!ent. (f it is additional co! ensation "hich the e! loyer ro!ised and agreed to gi'e "ithout any conditions i! osed for its ay!ent, such as success of business or greater roduction or out ut, then it is art of the "age. ;ut if it is aid only if rofits are reali5ed or if a certain le'el of roducti'ity is achie'ed, it cannot be considered art of the "age. &here it is not ayable to all but only to so!e e! loyees and only "hen their labor beco!es !ore efficient or !ore roducti'e, it is only an induce!ent for efficiency, a ri5e therefore, not a art of the "age. (n this case, there is no dis ute that +astern 4eleco!!unications Phils., (nc. and +astern 4eleco!s +! loyees Gnion agreed on the inclusion of a ro'ision for the grant of 1Eth, 1Bth and 1>th !onth bonuses in the 166712001 C;A Side Agree!ent, as "ell as in their 20011200E C;A Side Agree!ent, "hich contained no ,ualification for its ay!ent. 4here "ere no conditions s ecified in the C;A Side Agree!ents for the grant of the bonus. 4here "as nothing in the rele'ant ro'isions of the C;A "hich !ade the grant of the bonus de endent on the co! any)s financial standing or contingent u on the reali5ation of rofits. 4here "as also no state!ent that if the co! any deri'es no rofits, no bonus "ill be gi'en to the e! loyees. (n fine, the ay!ent of these bonuses "as not related to the rofitability of business o erations. Conse,uently, the gi'ing of the sub3ect bonuses cannot be ere! torily "ithdra"n by +astern 4eleco!!unications Phils., (nc. "ithout 'iolating Article 100 of the Labor Code, "hich rohibits the unilateral eli!ination or di!inution of benefits by the e! loyer. 4he rule is settled that any benefit and su le!ent being en3oyed by the e! loyees cannot be reduced, di!inished, discontinued or eli!inated by the e! loyer. 4he rinci le of non1di!inution of benefits is founded on the constitutional !andate to rotect the rights of "or%ers and to ro!ote their "elfare and to afford labor full rotection. Eastern ?elecommunications P*ilippines, Inc. vs. Eastern ?elecoms Employees Union, G.R. o. !%+""+, 2ebruary %, '#!'. +! loyee dis!issal$ constructi'e dis!issal. (n constructi'e dis!issal cases, the e! loyer has the burden of ro'ing that the transfer of an e! loyee is for 3ust or 'alid ground, such as genuine business necessity. 4he e! loyer !ust de!onstrate that the transfer is not unreasonable, incon'enient, or re3udicial to the e! loyee and that the transfer does not in'ol'e a de!otion in ran% or a di!inution in salary and other benefits. C(f the e! loyer fails to o'erco!e this burden of roof, the e! loyee)s transfer is tanta!ount to unla"ful constructi'e dis!issal.D M-erc% Shar and Doh!e .Phili ines0 '. /obles, 8./. :o. 1A>B0>, :o'e!ber 2B, 2006N Petitioners

failed to satisfy the burden of ro'ing that the transfer "as based on 3ust or 'alid ground. Petitioners) bare assertions of i!!inent threat fro! the res ondents are !ere accusations "hich are not substantiated by any roof. 4he Su re!e Court agreed "ith the Court of A eals in ruling that the transfer of res ondents a!ounted to a de!otion. (ulieCs -a9es*op and/or Edgar Reyes vs. >enry Arnai@, et al., G.R. o. !6$%%', 2ebruary !+, '#!'. +! loyee dis!issal$ disease$ dereliction of duties. &ith regard to disease as a ground for ter!ination, Article 27E of the Labor Code ro'ides that an e! loyer !ay ter!inate the ser'ices of an e! loyee "ho has been found to be suffering fro! any disease and "hose continued e! loy!ent is rohibited by la" or is re3udicial to his health, as "ell as to the health of his co1 e! loyees. (n order to 'alidly ter!inate e! loy!ent on this ground, Section 7, /ule (, ;oo% F( of the *!nibus /ules (! le!enting the Labor Code re,uires that# .i0 the e! loyee be suffering fro! a disease and his continued e! loy!ent is rohibited by la" or re3udicial to his health or to the health of his co1e! loyees, and .ii0 a certification by a co! etent ublic health authority that the disease is of such nature or at such a stage that it cannot be cured "ithin a eriod of si2 .>0 !onths e'en "ith ro er !edical treat!ent. (f the disease or ail!ent can be cured "ithin the eriod, the e! loyer shall not ter!inate the e! loyee but shall as% the e! loyee to ta%e a lea'e. 4he e! loyer shall reinstate such e! loyee to his for!er osition i!!ediately u on the restoration of his nor!al health. (n ?riple Eig*t Integrated )ervices, Inc. v. 0R, 1G.R. :o. 126B7E, Dece!ber =, 16674, the Court held that the re,uire!ent for a !edical certificate under Article 27E of the Labor Code cannot be dis ensed "ith$ other"ise, it "ould sanction the unilateral and arbitrary deter!ination by the e! loyer of the gra'ity or e2tent of the e! loyee)s illness and, thus, defeat the ublic olicy on the rotection of labor. (n this case, Onson should ha'e re orted bac% to "or% or attended the in'estigations conducted by &uerth Phili ines, (nc. i!!ediately u on being er!itted to "or% by his doctors, %no"ing that his osition re!ained 'acant for a considerable length of ti!e. Ho"e'er, he did not e'en sho" any sincere effort to return to "or%. Clearly, since there is no !ore hindrance for hi! to return to "or% and attend the in'estigations set by &uerth Phili ines, (nc., Onson)s failure to do so "as "ithout any 'alid or 3ustifiable reason. His conduct sho"s his indifference and utter disregard of his "or% and his e! loyer)s interest, and dis lays his clear, deliberate, and gross dereliction of duties. 4he o"er to dis!iss an e! loyee is a recogni5ed rerogati'e inherent in the e! loyer)s right to freely !anage and regulate his business. 4he la", in rotecting the rights of the laborers, authori5es neither o ression nor self1destruction of the e! loyer. 4he "or%er)s right to security of tenure is not an absolute right, for the la" ro'ides that he !ay be dis!issed for cause. As a general rule, e! loyers are allo"ed "ide latitude of discretion in ter!inating the e! loy!ent of !anagerial ersonnel. 4he !ere e2istence of a basis for belie'ing that such e! loyee has breached the trust and confidence of his e! loyer "ould suffice for his dis!issal. :eedless to say, an irres onsible e! loyee li%e Onson does not deser'e a osition in the "or% lace, and it is &uerth Phili ines, (nc.)s !anage!ent rerogati'e to ter!inate his e! loy!ent. 4o be sure, an e! loyer cannot be co! elled to continue "ith the e! loy!ent of "or%ers "hen continued e! loy!ent "ill ro'e ini!ical to the e! loyer)s interest. Auert* P*ilippines, Inc. vs. Rodante Enson, G.R. o. !6+&$', 2ebruary !+, '#!'. +! loyee dis!issal$ due rocess. &ith res ect to due rocess re,uire!ent, the e! loyer is bound to furnish the e! loyee concerned "ith t"o .20 "ritten notices before ter!ination of e! loy!ent can be legally effected. *ne is the notice a rising the e! loyee of the articular acts or o!issions for "hich his dis!issal is sought and this !ay loosely be considered as the ro er charge. 4he other is the notice infor!ing the e! loyee of the !anage!ent)s decision to se'er his e! loy!ent. 4his decision, ho"e'er, !ust co!e only after the e! loyee is gi'en a

reasonable eriod fro! recei t of the first notice "ithin "hich to ans"er the charge, thereby gi'ing hi! a! le o ortunity to be heard and defend hi!self "ith the assistance of his re resentati'e should he so desire. 4he re,uire!ent of notice, it has been stressed, is not a !ere technicality but a re,uire!ent of due rocess to "hich e'ery e! loyee is entitled. Here, Palacio Del 8obernador Condo!iniu! Cor oration co! lied "ith the Ct"o1notice ruleD stated abo'e. )ebastian 2. <asay, (r. vs. Palacio del Gobernador ,ondominium ,orporation and <mar ?. ,ru@, G.R. o. !&8$#", 2ebruary ", '#!'. +! loyee dis!issal$ due rocess. Cityland did not afford 8alang the re,uired notice before he "as dis!issed. As the Court of A eals noted, the in'estigation conference 4u as called to loo% into the 3anitors) co! laints against 8alang did not constitute the "ritten notice re,uired by la" as he had no clear idea "hat the charges against hi! "ere. Romeo A. Galang vs. ,itiland )*aw ?ower, Inc. and /irgilio -aldemor, G.R. o. !6$'&!, 2ebruary %, '#!'. +! loyee dis!issal$ grounds. 4he 'alidity of an e! loyee)s dis!issal fro! ser'ice hinges on the satisfaction of the t"o substanti'e re,uire!ents for a la"ful ter!ination. 4hese are, first, "hether the e! loyee "as accorded due rocess the basic co! onents of "hich are the o ortunity to be heard and to defend hi!self. 4his is the rocedural as ect. And second, "hether the dis!issal is for any of the causes ro'ided in the Labor Code of the Phili ines. 4his constitutes the substanti'e as ect. *n the substanti'e as ect, the Su re!e Court found that Palacio Del 8obernador Condo!iniu! Cor oration)s ter!ination of the *asay)s e! loy!ent "as for a cause ro'ided under the Labor Code. (n ter!inating *asay)s e! loy!ent, Palacio Del 8obernador Condo!iniu! Cor oration in'o%ed loss of trust and confidence. 4he first re,uisite for dis!issal on the ground of loss of trust and confidence is that the e! loyee concerned !ust be holding a osition of trust and confidence. Here, it is indubitable that *asay holds a osition of trust and confidence. 4he osition of ;uilding Ad!inistrator, being !anagerial in nature, necessarily en3oys the trust and confidence of the e! loyer. 4he second re,uisite is that there !ust be an act that "ould 3ustify the loss of trust and confidence. Loss of trust and confidence, to be a 'alid cause for dis!issal, !ust be based on a "illful breach of trust and founded on clearly established facts. Palacio Del 8obernador Condo!iniu! Cor oration had established, by clear and con'incing e'idence, *asay)s acts "hich 3ustified its loss of trust and confidence on the for!er. )ebastian 2. <asay, (r. vs. Palacio del Gobernador ,ondominium ,orporation and <mar ?. ,ru@, G.R. o. !&8$#", 2ebruary ", '#!'. +! loyee dis!issal$ 3ust cause. 4he Su re!e Court found that 8alang had beco!e unfit to continue his e! loy!ent. 4he e'idence su orts the 'ie" that he continued to e2hibit undesirable traits as an e! loyee and as a erson, in relation to both his co1"or%ers and his su eriors, articularly 4u as, her i!!ediate su er'isor. Quoting the Court of A eals) decision "ith a ro'al, the Su re!e Court held# C&ithout offering any ossible ill !oti'e that !ight ha'e i! elled Mthe res ondentsN to su!!arily dis!iss M8alangN, "ho ad!itted ha'ing been absorbed by the for!er as 3anitor u on the ter!ination of his contract "ith his agency, this Court is !ore inclined to gi'e credence to the e'idence ointing to the conclusion that M8alang)sN e! loy!ent "as actually se'ered for a 3ust cause.D Romeo A. Galang vs. ,itiland )*aw ?ower, Inc. and /irgilio -aldemor, G.R. o. !6$'&!, 2ebruary %, '#!'. +! loyer$ right to disci line e! loyee. (n Sagales '. /ustan)s Co!!ercial Cor oration .8./. :o. 1>>BBE, :o'e!ber 2A, 20070, the Su re!e Court ruled#

4ruly, "hile the e! loyer has the inherent right to disci line, including that of dis!issing its e! loyees, this rerogati'e is sub3ect to the regulation by the State in the e2ercise of its olice o"er. (n this regard, it is a hornboo% doctrine that in#ractions committed by an employee should merit only the corresponding penalty demanded by the circumstance$ %he penalty must be commensurate with the act& conduct or omission imputed to the employee and must be imposed in connection with the disciplinary authority o# the employer$ .+! hasis in the original.0 (n the case at bar, the enalty handed out by the etitioners "as the ulti!ate enalty of dis!issal. 4here "as no "arning or ad!onition for res ondent)s 'iolation of tea! rules, only outright ter!ination of his ser'ices for an act "hich could ha'e been unished a ro riately "ith a se'ere re ri!and or sus ension. egros )las*ers, Inc., Rodol5o ,. Alvare@ and /icente ?an vs. Alvin 0. ?eng, G.R. o. !%6!'', 2ebruary '', '#!'. +! loyer1e! loyee relationshi $ onus robandi. 4he onus probandi falls on etitioner to establish or substantiate such clai! by the re,uisite ,uantu! of e'idence. 4he issue of Ja'ier)s alleged illegal dis!issal is anchored on the e2istence of an e! loyer1e! loyee relationshi bet"een hi! and 9ly Ace. As the records bear out, the Labor Arbiter and the Court of A eals found Ja'ier)s clai! of e! loy!ent "ith 9ly Ace as "anting and deficient. Although Section 10, /ule F(( of the :e" /ules of Procedure of the :L/C allo"s a rela2ation of the rules of rocedure and e'idence in labor cases, this rule of liberality does not !ean a co! lete dis ensation of roof. Labor officials are en3oined to use reasonable !eans to ascertain the facts s eedily and ob3ecti'ely "ith little regard to technicalities or for!alities but no"here in the rules are they ro'ided a license to co! letely discount e'idence, or the lac% of it. 4he ,uantu! of roof re,uired, ho"e'er, !ust still be satisfied. Hence, C"hen confronted "ith conflicting 'ersions on factual !atters, it is for the! in the e2ercise of discretion to deter!ine "hich arty deser'es credence on the basis of e'idence recei'ed, sub3ect only to the re,uire!ent that their decision !ust be su orted by substantial e'idence.D M )alvador 0acorte v. >on. Amado G. Inciong, 2E7 Phil. 2=2 .16770N Accordingly, Ja'ier needs to sho" by substantial e'idence that he "as indeed an e! loyee of the co! any against "hich he clai!s illegal dis!issal. -itoy (avier 13anilo P. (avier4 vs. 2ly Ace ,orporation/2lordelyn ,astillo, G.R. o. !&'++%, 2ebruary !+, '#!'. +! loyer1e! loyee relationshi $ test. 4o deter!ine the e2istence of an e! loyer1e! loyee relationshi , the follo"ing are considered# .10 the selection and engage!ent of the e! loyee$ .20 the ay!ent of "ages$ .=0 the o"er of dis!issal$ and .E0 the o"er to control the e! loyee)s conduct. *f these ele!ents, the !ost i! ortant criterion is "hether the e! loyer controls or has reser'ed the right to control the e! loyee not only as to the result of the "or% but also as to the !eans and !ethods by "hich the result is to be acco! lished. (n this case, Ja'ier "as not able to ersuade the Court that the abo'e ele!ents e2ist in his case. He could not sub!it co! etent roof that 9ly Ace engaged his ser'ices as a regular e! loyee$ that 9ly Ace aid his "ages as an e! loyee, or that 9ly Ace could dictate "hat his conduct should be "hile at "or%. (n other "ords, Ja'ier)s allegations did not establish that his relationshi "ith 9ly Ace had the attributes of an e! loyer1e! loyee relationshi on the basis of the abo'e1!entioned four1fold test. &orse, Ja'ier "as not able to refute 9ly Ace)s assertion that it had an agree!ent "ith a hauling co! any to underta%e the deli'ery of its goods. (t "as also baffling to reali5e that Ja'ier did not dis ute 9ly Ace)s denial of his ser'ices) e2clusi'ity to the co! any. (n short, all that Ja'ier laid do"n

"ere bare allegations "ithout corroborati'e roof. -itoy (avier 13anilo P. (avier4 vs. 2ly Ace ,orporation/2lordelyn ,astillo, G.R. o. !&'++%, 2ebruary !+, '#!'. +! loy!ent contract$ stages. Contracts undergo three distinct stages, to "it# negotiation$ erfection or birth$ and consu!!ation. :egotiation begins fro! the ti!e the ros ecti'e contracting arties !anifest their interest in the contract and ends at the !o!ent of agree!ent of the arties. Perfection or birth of the contract ta%es lace "hen the arties agree u on the essential ele!ents of the contract. Consu!!ation occurs "hen the arties fulfill or erfor! the ter!s agreed u on in the contract, cul!inating in the e2tinguish!ent thereof. Gnder Article 1=1B of the Ci'il Code, a contract is erfected by !ere consent and fro! that !o!ent the arties are bound not only to the fulfill!ent of "hat has been e2 ressly sti ulated but also to all the conse,uences "hich, according to their nature, !ay be in %ee ing "ith good faith, usage and la". An e! loy!ent contract, li%e any other contract, is erfected at the !o!ent .10 the arties co!e to agree u on its ter!s$ and .20 concur in the essential ele!ents thereof# .a0 consent of the contracting arties, .b0 ob3ect certain "hich is the sub3ect !atter of the contract and .c0 cause of the obligation. (n the resent case, C.9. Shar , on behalf of its rinci al, (nternational Shi ing -anage!ent, (nc., hired Agustin and -ini!o as Sandblaster<Painter for a =1!onth contract, "ith a basic !onthly salary of GSREB0.00. 4hus, the ob3ect of the contract is the ser'ice to be rendered by Agustin and -ini!o on board the 'essel "hile the cause of the contract is the !onthly co! ensation they e2 ect to recei'e. 4hese ter!s "ere e!bodied in the Contract of +! loy!ent "hich "as e2ecuted by the arties. 4he agree!ent u on the ter!s of the contract "as !anifested by the consent freely gi'en by both arties through their signatures in the contract. :either arties disa'o" the consent they both 'oluntarily ga'e. 4hus, there is a erfected contract of e! loy!ent. ,.2. )*arp F ,o. Inc. and (o*n (. Roc*a vs. Pioneer Insurance and )urety ,orporation, et al., G.R. o. !6&8"&, 2ebruary !+, '#!'. +! loy!ent relationshi $ co!!ence!ent. 4he co!!ence!ent of an e! loyer1e! loyee relationshi !ust be treated se arately fro! the erfection of an e! loy!ent contract. )antiago v. ,2 )*arp ,rew Management, Inc., .8./. :o. 1>2E16, 10 July 200A0 is an instructi'e recedent on this oint. (n that case, the Su re!e Court !ade a distinction bet"een the erfection of the e! loy!ent contract and the co!!ence!ent of the e! loyer1e! loyee relationshi , thus# ?*e per5ection o5 t*e contract, w*ic* in t*is case coincided wit* t*e date o5 e7ecution t*ereo5, occurred w*en petitioner and respondent agreed on t*e obHect and t*e cause, as well as t*e rest o5 t*e terms and conditions t*erein. ?*e commencement o5 t*e employer.employee relations*ip, as earlier discussed, would *ave ta9en place *ad petitioner been actually deployed 5rom t*e point o5 *ire. ?*us, even be5ore t*e start o5 any employer.employee relations*ip, contemporaneous wit* t*e per5ection o5 t*e employment contract was t*e birt* o5 certain rig*ts and obligations, t*e breac* o5 w*ic* may give rise to a cause o5 action against t*e erring party. Des ite the fact that the e! loyer1e! loyee relationshi has not co!!enced due to the failure to de loy Agustin and -ini!o in this case, Agustin and -ini!o are entitled to rights arising fro! the erfected Contract of +! loy!ent, such as the right to de!and erfor!ance by C.9. Shar of its obligation under the contract. ,.2. )*arp F ,o. Inc. and (o*n (. Roc*a vs. Pioneer Insurance and )urety ,orporation, et al., G.R. o. !6&8"&, 2ebruary !+, '#!'. 9oru! sho ing$ ele!ents$ res 3udicata. 9or foru! sho ing to e2ist, it is necessary that .a0 there be identity of arties or at least such arties that re resent the sa!e interests in both actions$ .b0 there be identity of rights asserted and relief rayed for, the relief being founded on the sa!e

facts$ and .c0 the identity of the t"o receding articulars is such that any 3udg!ent rendered in one action "ill, regardless of "hich arty is successful, a!ount to res Hudicata in the other action. Petitioners are correct as to the first t"o re,uisites of foru! sho ing. 9irst, there is identity of arties in'ol'ed# :egros Slashers (nc. and res ondent 4eng. Second, there is identity of rights asserted i.e., the right of !anage!ent to ter!inate e! loy!ent and the right of an e! loyee against illegal ter!ination. Ho"e'er, the third re,uisite of foru! sho ing is !issing in this case. Any 3udg!ent or ruling of the *ffice of the Co!!issioner of the -etro olitan ;as%etball Association "ill not a!ount to res Hudicata. Res Hudicata is defined in 3uris rudence as to ha'e four basic ele!ents# .10 the 3udg!ent sought to bar the ne" action !ust be final$ .20 the decision !ust ha'e been rendered by a court ha'ing 3urisdiction o'er the sub3ect !atter and the arties$ .=0 the dis osition of the case !ust be a 3udg!ent on the !erits$ and .E0 there !ust be as bet"een the first and second action, identity of arties, sub3ect !atter, and causes of action. Here, although contractually authori5ed to settle dis utes, the *ffice of the Co!!issioner of the -etro olitan ;as%etball Association is not a court of co! etent 3urisdiction as conte! lated by la" "ith res ect to the a lication of the doctrine of res Hudicata. At best, the *ffice of the Co!!issioner of the -etro olitan ;as%etball Association is a ri'ate !ediator or go1bet"een as agreed u on by tea! !anage!ent and a layer in the -etro olitan ;as%etball Association Player)s Contract of +! loy!ent. Any 3udg!ent that the *ffice of the Co!!issioner of the -etro olitan ;as%etball Association !ay render "ill not result in a bar for see%ing redress in other legal 'enues. Hence, res ondent)s action of filing the sa!e co! laint in the /egional Arbitration ;ranch of the :L/C does not constitute foru! sho ing. egros )las*ers, Inc., Rodol5o ,. Alvare@ and /icente ?an vs. Alvin 0. ?eng, G.R. o. !%6!'', 2ebruary '', '#!'. Jurisdiction$ :L/C. (t is clear fro! the :L/C /ules of Procedure that a eals !ust be 'erified and certified against foru!1sho ing by the arties1in1interest the!sel'es. 4he ur ose of 'erification is to secure an assurance that the allegations in the leading are true and correct and ha'e been filed in good faith. (n the case at bar, the arties1in1interest are etitioner Salenga, as the e! loyee, and res ondent Clar% De'elo !ent Cor oration as the e! loyer. A cor oration can only e2ercise its o"ers and transact its business through its board of directors and through its officers and agents "hen authori5ed by a board resolution or its byla"s. 4he o"er of a cor oration to sue and be sued is e2ercised by the board of directors. 4he hysical acts of the cor oration, li%e the signing of docu!ents, can be erfor!ed only by natural ersons duly authori5ed for the ur ose by cor orate byla"s or by a s ecific act of the board. Absent the re,uisite board resolution, neither 4i!bol1/o!an nor Atty. -allari, "ho signed the -e!orandu! of A eal and Joint Affida'it of Declaration allegedly on behalf of res ondent cor oration, !ay be considered as the Ca ellantD and Ce! loyerD referred to by the :L/C /ules of Procedure. As such, the :L/C had no 3urisdiction to entertain the a eal. Antonio -. )alenga, et al. vs. ,ourt o5 Appeals, et al., G.R. o. !68&8!, 2ebruary !, '#!'. Labor$ effect if rocedural due rocess not follo"ed but "ith a 'alid cause for ter!ination. (t is re,uired that the e! loyer furnish the e! loyee "ith t"o "ritten notices# .10 a "ritten notice ser'ed on the e! loyee s ecifying the ground or grounds for ter!ination, and gi'ing to said e! loyee reasonable o ortunity "ithin "hich to e2 lain his side$ and .20 a "ritten notice of ter!ination ser'ed on the e! loyee indicating that u on due consideration of all the circu!stances, grounds ha'e been established to 3ustify his ter!ination. 4he t"in re,uire!ents of notice and hearing constitute the ele!ents of due rocess in cases of e! loyee)s dis!issal. 4he re,uire!ent of notice is intended to infor! the e! loyee concerned of the e! loyer)s intent to dis!iss and the reason for the ro osed dis!issal. G on the other hand, the re,uire!ent of hearing affords the e! loyee an o ortunity to ans"er his e! loyer)s charges against hi! and accordingly, to defend hi!self therefro! before dis!issal is effected. *b'iously, the second

"ritten notice, as indis ensable as the first, is intended to ensure the obser'ance of due rocess. (n this case, there "as only one "ritten notice "hich re,uired res ondents to e2 lain "ithin fi'e .B0 days "hy they should not be dis!issed fro! the ser'ice. Alco'endas "as the only one "ho signed the recei t of the notice. 4he others, as clai!ed by Lyn'il, refused to sign. 4he other e! loyees argue that no notice "as gi'en to the!. Des ite the inconsistencies, "hat is clear is that no final "ritten notice or notices of ter!ination "ere sent to the e! loyees. Due to the failure of Lyn'il to follo" the rocedural re,uire!ent of t"o1notice rule, no!inal da!ages in the a!ount of PB0,000 "ere granted to Ariola, et al. des ite their dis!issal for 3ust cause. 0ynvil 2is*ing Enterprises, Inc. vs. Andres G. Ariola, et al., G.R. o. !%!&68, 2ebruary !, '#!'. Labor$ liability of officers if ter!ination is attended "ith bad faith. (n labor cases, the cor orate directors and officers are solidarily liable "ith the cor oration for the ter!ination of e! loy!ent of e! loyees done "ith !alice or in bad faith. (ndeed, !oral da!ages are reco'erable "hen the dis!issal of an e! loyee is attended by bad faith or fraud or constitutes an act o ressi'e to labor, or is done in a !anner contrary to good !orals, good custo!s or ublic olicy. 4he ter! Cbad faithD conte! lates a Cstate of !ind affir!ati'ely o erating "ith furti'e design or "ith so!e !oti'e of self1interest or "ill or for ulterior ur ose.D 4he Su re!e Court agreed "ith the ruling of both the :L/C and the Court of A eals "hen they ronounced that there "as no e'idence on record that indicates co!!ission of bad faith on the art of De ;or3a, the general !anager of Lyn'il, "ho "as tas%ed "ith the su er'ision of the e! loyees and the o eration of the business. 4here is no roof that he i! osed on Ariola, et al. the C por viaHeD ro'ision for ur ose of effecting their su!!ary dis!issal. 0ynvil 2is*ing Enterprises, Inc. vs. Andres G. Ariola, et al., G.R. o. !%!&68, 2ebruary !, '#!'. Labor$ nature of e! loy!ent$ security of tenure. (n the conte2t of these facts S .10 Ariola, et al. "ere doing tas%s necessary to Lyn'il)s fishing business "ith ositions ranging fro! ca tain of the 'essel to bodegero$ .20 after the end of a tri , they "ill again be hired for another tri "ith ne" contracts$ and .=0 this arrange!ent continued for !ore than ten years ? the Court belie'ed that Lyn'il intended to go around the security of tenure of Ariola, et al. as regular e! loyees. 4he Court held that by the e2 ress ro'isions of the second aragra h of Article 270 "hich co'er casual e! loy!ent, Ariola, et al. had beco!e regular e! loyees of Lyn'il. 0ynvil 2is*ing Enterprises, Inc. vs. Andres G. Ariola, et al., G.R. o. !%!&68, 2ebruary !, '#!'. Labor$ rocedural and substanti'e due rocess$ grounds for 'alid ter!ination$ breach of trust. Just cause is re,uired for a 'alid dis!issal. 4he Labor Code ro'ides that an e! loyer !ay ter!inate an e! loy!ent based on fraud or "illful breach of the trust re osed on the e! loyee. Such breach is considered "illful if it is done intentionally, %no"ingly, and ur osely, "ithout 3ustifiable e2cuse, as distinguished fro! an act done carelessly, thoughtlessly, heedlessly or inad'ertently. (t !ust also be based on substantial e'idence and not on the e! loyer)s "hi!s or ca rices or sus icions other"ise, the e! loyee "ould eternally re!ain at the !ercy of the e! loyer. Loss of confidence !ust not be indiscri!inately used as a shield by the e! loyer against a clai! that the dis!issal of an e! loyee "as arbitrary. And, in order to constitute a 3ust cause for dis!issal, the act co! lained of !ust be "or%1related and sho"s that the e! loyee concerned is unfit to continue "or%ing for the e! loyer. (n addition, loss of confidence as a 3ust cause for ter!ination of e! loy!ent is re!ised on the fact that the e! loyee concerned holds a osition of res onsibility, trust and confidence or that the e! loyee concerned is entrusted "ith confidence in delicate !atters, such as the handling or care and rotection of the ro erty and assets of the e! loyer. 4he betrayal of this trust is the essence of the offense for "hich an e! loyee is enali5ed. 4he Su re!e Court found that breach of trust is resent in this case, "hen Ariola .the ca tain0, Alco'endas .Chief -ate0, Calinao .Chief +ngineer0, :ubla .coo%0,

;aTe5 .oiler0, and Sebullen .bodegero0 cons ired "ith one another and stole C pampanoD and CtangigueD fish and deli'ered the! to another 'essel, to the re3udice of Lyn'il. 0ynvil 2is*ing Enterprises, Inc. vs. Andres G. Ariola, et al., G.R. o. !%!&68, 2ebruary !, '#!'. Labor$ ublic rosecutor)s decision not binding on the labor tribunal. 4he Su re!e Court has held in icolas v. ational 0abor Relations ,ommission I=2A Phil. 77=, 77>177A .166>0N that a cri!inal con'iction is not necessary to find 3ust cause for e! loy!ent ter!ination. *ther"ise stated, an e! loyee)s ac,uittal in a cri!inal case, es ecially one that is grounded on the e2istence of reasonable doubt, "ill not reclude a deter!ination in a labor case that he is guilty of acts ini!ical to the e! loyer)s interests. (n the re'erse, the finding of robable cause is not follo"ed by auto!atic ado tion of such finding by the labor tribunals. (n other "ords, "hiche'er "ay the ublic rosecutor dis oses of a co! laint, the finding does not bind the labor tribunal. Lyn'il contends that the filing of a cri!inal case before the *ffice of the Prosecutor is sufficient basis for a 'alid ter!ination of e! loy!ent based on serious !isconduct and<or loss of trust and confidence. 4he Su re!e Court held that Lyn'il cannot argue that since the *ffice of the Prosecutor found robable cause for theft, the Labor Arbiter !ust follo" the finding as a 'alid reason for the ter!ination of res ondents) e! loy!ent. 4he roof re,uired for ur oses that differ fro! one and the other are li%e"ise different. 0ynvil 2is*ing Enterprises, Inc. vs. Andres G. Ariola, et al., G.R. o. !%!&68, 2ebruary !, '#!'. Labor$ regular e! loyee$ fi2ed1contract agree!ent, re,uisites for 'alidity. Prior Su re!e Court decisions ha'e laid t"o conditions for the 'alidity of a fi2ed1contract agree!ent bet"een the e! loyer and e! loyee# 2irst, the fi2ed eriod of e! loy!ent "as %no"ingly and 'oluntarily agreed u on by the arties "ithout any force, duress, or i! ro er ressure being brought to bear u on the e! loyee and absent any other circu!stances 'itiating his consent$ or )econd, it satisfactorily a ears that the e! loyer and the e! loyee dealt "ith each other on !ore or less e,ual ter!s "ith no !oral do!inance e2ercised by the for!er or the latter. Lyn'il contends that Ariola, et al. "ere e! loyed under a fi2ed1ter! contract "hich e2 ired at the end of the 'oyage. Contrarily, Ariola, et al. contend that they beca!e regular e! loyees by reason of their continuous hiring and erfor!ance of tas%s necessary and desirable in the usual trade and business of Lyn'il. 4e2tually, the ro'ision in the contract bet"een Lyn'il and Ariola, et al. that# : A a9o ay sumasang.ayon na magling9od at gumawa ng mga gawain sang.ayon sa pata9arang :por viaHe; na magmumula sa pagalis sa avotas papunta sa pangisdaan at pagbabali9 sa pondo*an ng lantsa sa avotas, Metro Manila; is for a fi2ed eriod of e! loy!ent. (n the conte2t, ho"e'er, of the facts that# .10 Ariola, et al. "ere doing tas%s necessarily to Lyn'il)s fishing business "ith ositions ranging fro! ca tain of the 'essel to bodegero$ .20 after the end of a tri , they "ill again be hired for another tri "ith ne" contracts$ and .=0 this arrange!ent continued for !ore than ten years, the clear intention is to go around the security of tenure of Ariola, et al. as regular e! loyees. As such, the Su re!e Court found that Ariola, et al. are regular e! loyees. 0ynvil 2is*ing Enterprises, Inc. vs. Andres G. Ariola, et al., G.R. o. !%!&68, 2ebruary !, '#!'. Labor Code$ !a2i!u! a"ard of attorney)s fees in cases of reco'ery of "ages. Article 111 of the Labor Code ro'ides for a !a2i!u! a"ard of attorney)s fees in cases of reco'ery of "ages# a. (n cases of unla"ful "ithholding of "ages, the cul able arty !ay be assessed attorney)s fees e,ui'alent to ten ercent of the a!ount of "ages reco'ered.

b. (t shall be unla"ful for any erson to de!and or acce t, in any 3udicial or ad!inistrati'e roceedings for the reco'ery of "ages, attorney)s fees "hich e2ceed ten ercent of the a!ount of "ages reco'ered. Since De 8racia, et al. had to secure the ser'ices of the la"yer to reco'er their un aid salaries and rotect their interest, attorney)s fees in the a!ount of ten ercent .10H0 of the total clai!s "as i! osed. )9ippers United Paci5ic, Inc. and )9ippers Maritime )ervices, Inc. 0td. vs. at*aniel 3o@a, et al., G.R. o. !6+++%. 2ebruary %, '#!'. Labor contracting$ ele!ents. 4here is labor1only contracting "here# .a0 the erson su lying "or%ers to an e! loyer does not ha'e substantial ca ital or in'est!ent in the for! of tools, e,ui !ent, !achineries, "or% re!ises, a!ong others$ and .b0 the "or%ers recruited and laced by such erson are erfor!ing acti'ities "hich are directly related to the rinci al business of the e! loyer. (n the resent case, the Su re!e Court found that both the ca itali5ation re,uire!ent and the o"er of control on the art of /e,uiTo are "anting. 8enerally, the resu! tion is that the contractor is a labor1only contractor unless such contractor o'erco!es the burden of ro'ing that it has the substantial ca ital, in'est!ent, tools and the li%e. (n the resent case, though 8arden of -e!ories is not the contractor, it has the burden of ro'ing that /e,uiTo has sufficient ca ital or in'est!ent since it is clai!ing the su osed status of /e,uiTo as inde endent contractor. 8arden of -e!ories, ho"e'er, failed to adduce e'idence ur orting to sho" that /e,uiTo had sufficient ca itali5ation. :either did it sho" that she in'ested in the for! of tools, e,ui !ent, !achineries, "or% re!ises and other !aterials "hich are necessary in the co! letion of the ser'ice contract. Garden o5 Memories Par9 and 0i5e Plan, Inc., et al. vs. 0R,, 'nd 3iv., et al., G.R. o. !"#'6%, 2ebruary %, '#!'. -igrant &or%ers$ /A :o. 70E2$ !oney clai!s in cases of un3ust ter!ination. Section 10 of /e ublic Act :o. 70E2 .-igrant &or%ers Act0 ro'ides for !oney clai!s in cases of un3ust ter!ination of e! loy!ent contracts# (n case of ter!ination of o'erseas e! loy!ent "ithout 3ust, 'alid or authori5ed cause as defined by la" or contract, the "or%ers shall be entitled to the full rei!burse!ent of his lace!ent fee "ith interest of t"el'e ercent .12H0 er annu!, lus his salaries for the une2 ired ortion of his e! loy!ent contract or for three .=0 !onths for e'ery year of the une2 ired ter!, "hiche'er is less. 4he -igrant &or%ers Act ro'ides that salaries for the une2 ired ortion of the e! loy!ent contract or three .=0 !onths for e'ery year of the une2 ired ter!, "hiche'er is less, shall be a"arded to the o'erseas 9ili ino "or%er, in cases of illegal dis!issal. Ho"e'er, in 2E -arch 2006, )errano v. Gallant Maritime )ervices and Marlow avigation ,o. Inc. .8./. :o. 1>A>1E0, the Court, in an +n ;anc Decision, declared unconstitutional the clause Cor for three !onths for e'ery year of the une2 ired ter!, "hiche'er is lessD and a"arded the entire une2 ired ortion of the e! loy!ent contract to the o'erseas 9ili ino "or%er. *n 7 -arch 2010, ho"e'er, Section A of /e ublic Act :o. 10022 ./A 100220 a!ended Section 10 of the -igrant &or%ers Act, and once again reiterated the ro'ision of a"arding the une2 ired ortion of the e! loyent contract or three .=0 !onths for e'ery year of the une2 ired ter!, "hiche'er is less. :e'ertheless, since the ter!ination occurred on January 1666 before the assage of the a!endatory /A 10022, the Su re!e Court a lied /A 70E2, "ithout touching on the constitutionality of Section A of /A 10022. 4he declaration in -arch 2006 of the unconstitutionality of the clause Cor for three !onths for e'ery year of the une2 ired ter!, "hiche'er is lessD in /A 70E2 shall be gi'en retroacti'e effect to the ter!ination that occurred in January 1666 because an unconstitutional

clause in the la" confers no rights, i! oses no duties and affords no rotection. 4he unconstitutional ro'ision is ino erati'e, as if it "as not assed into la" at all. )9ippers United Paci5ic, Inc. and )9ippers Maritime )ervices, Inc. 0td. vs. at*aniel 3o@a, et al., G.R. o. !6+++%. 2ebruary %, '#!'. :L/C$ conte! t o"ers. Gnder Article 217 the Labor Code, the :L/C .and the labor arbiters0 !ay hold any offending arty in conte! t, directly or indirectly, and i! ose a ro riate enalties in accordance "ith la". 4he enalty for direct conte! t consists of either i! rison!ent or fine, the degree or a!ount de ends on "hether the conte! t is against the Co!!ission or the labor arbiter. 4he Labor Code, ho"e'er, re,uires the labor arbiter or the Co!!ission to deal "ith indirect conte! t in the !anner rescribed under /ule A1 of the /ules of Court. /ule A1 of the /ules of Court does not re,uire the labor arbiter or the :L/C to initiate indirect conte! t roceedings before the trial court. 4his !ode is to be obser'ed only "hen there is no la" granting the! conte! t o"ers. As is clear under Article 217.d0 of the Labor Code, the labor arbiter or the Co!!ission is e! o"ered or has 3urisdiction to hold the offending arty or arties in direct or indirect conte! t. /obosa, et al., therefore, ha'e not i! ro erly brought the indirect conte! t charges against the res ondents before the :L/C. 2ederico ). Robosa, et al. vs. ational 0abor Relations ,ommission 12irst 3ivision4, et al., G.R. o. !6"#%+, 2ebruary %, '#!'. :L/C$ factual findings. (t is a "ell1entrenched rule that findings of facts of the :L/C, affir!ing those of the Labor Arbiter, are accorded res ect and due consideration "hen su orted by substantial e'idence. 4he Su re!e Court, ho"e'er, found that the doctrine of great res ect and finality has no a lication to the case at bar. 4he Labor Arbiter dis!issed Arnai5, et al.)s co! laints on !ere technicality. 4he :L/C, u on a eal, then ca!e u "ith three di'ergent rulings. At first, it re!anded the case to the Labor Arbiter. Ho"e'er, in a subse,uent resolution, it decided to resol'e the case on the !erits by ruling that Arnai5, et al. "ere constructi'ely dis!issed. ;ut later on, it again re'ersed itself in its third and final resolution of the case and ruled in fa'or of Julie)s ba%esho . 4herefore, contrary to /eyes)s clai!, the :L/C did not, on any occasion, affir! any factual findings of the Labor Arbiter. 4he Court of A eals is thus correct in re'ie"ing the entire records of the case to deter!ine "hich findings of the :L/C is sound and in accordance "ith la". ;esides, the Court of A eals !ay still resol'e factual issues by e2 ress !andate of the la" des ite the res ect gi'en to ad!inistrati'e findings of fact. (ulieCs -a9es*op and/or Edgar Reyes vs. >enry Arnai@, et al., G.R. o. !6$%%', 2ebruary !+, '#!'. Probationary e! loyee$ 'alid cause for dis!issal but "ithout rocedural due rocess$ e! loyee entitled to no!inal da!ages. Section 2, /ule (, ;oo% F( of the Labor Code)s (! le!enting /ules and /egulations ro'ides# CI5 t*e termination is broug*t about by t*e completion o5 a contract or p*ase t*ereo5, or by 5ailure o5 an employee to meet t*e standards o5 t*e employer in t*e case o5 probationary employment, it s*all be su55icient t*at a written notice is served t*e employee wit*in a reasonable time 5rom t*e e55ective date o5 termination. D Dalangin "as hired by Canadian * ortunities as (!!igration and Legal -anager, sub3ect to a robationary eriod of si2 !onths. *ne !onth after hiring Dalangin, the co! any ter!inated his e! loy!ent, declaring hi! CunfitD and Cun,ualifiedD to continue as (!!igration and Legal -anager, for reasons "hich included obstinacy and utter disregard of co! any olicies. Pro ensity to ta%e rolonged and e2tended lunch brea%s, sho"s no interest in fa!iliari5ing oneself "ith the olicies and ob3ecti'es, lac% of concern for the co! any)s interest des ite ha'ing 3ust been e! loyed in the co! any .Declined to attend co! any s onsored acti'ities, se!inars intended to fa!iliari5e co! any e! loyees "ith -anage!ent ob3ecti'es and enhance!ent of co! any interest and ob3ecti'es0, lac% of enthusias! to"ard "or%, and lac% of interest in fostering relationshi "ith

his co1e! loyees. 4he co! any contends that it co! lied "ith the rule on rocedural due rocess "hen it as%ed Dalangin, through a -e!orandu!, to e2 lain "hy he could not attend the se!inar. &hen he failed to sub!it his e2 lanation, the co! any ser'ed hi! a notice the follo"ing day ter!inating his e! loy!ent. According to the Su re!e Court, the notice to Dalangin "as not ser'ed "ithin a reasonable ti!e fro! the effecti'e date of his ter!ination as re,uired by the rules since he "as dis!issed on the 'ery day the notice "as gi'en to hi!. Ho"e'er, because of the e2istence of a 'alid cause for ter!ination, the Su re!e Court did not in'alidate his dis!issal but enali5ed the co! any for its non1co! liance "ith the notice re,uire!ent, and ordered the co! any to ay an inde!nity, in the for! of no!inal da!ages a!ounting to P10,000. ,anadian <pportunities Unlimited, Inc. vs. -art B. 3alangin, (r., G.R. o. !6'''$, 2ebruary ", '#!'. Probationary e! loyee$ 'alid dis!issal e'en before > !onths. 4he essence of a robationary eriod of e! loy!ent funda!entally lies in the ur ose or ob3ecti'e of both the e! loyer and the e! loyee during the eriod. &hile the e! loyer obser'es the fitness, ro riety and efficiency of a robationer to ascertain "hether he is ,ualified for er!anent e! loy!ent, the latter see%s to ro'e to the for!er that he has the ,ualifications to !eet the reasonable standards for er!anent e! loy!ent. 4he Ctrial eriodD or the length of ti!e the robationary e! loyee re!ains on robation de ends on the arties) agree!ent, but it shall not e2ceed si2 .>0 !onths under Article 271 of the Labor Code. 4he Su re!e Court found substantial e'idence indicating that the co! any "as 3ustified in ter!inating Dalangin)s robationary e! loy!ent. Dalangin ad!itted in co! ulsory arbitration that the ro2i!ate cause for his dis!issal "as his refusal to attend the co! any)s CFalues 9or!ation Se!inarD scheduled for *ctober 2A, 2001, a Saturday. He refused to attend the se!inar after he learned that it had no relation to his duties, as he clai!ed, and that he had to lea'e at 2#00 .!. because he "anted to be "ith his fa!ily in the ro'ince. &hen the Chief * erations *fficer, insisted that he attend the se!inar to encourage his co1e! loyees to attend, he stood at on not attending, arguing that !ar%ed differences e2ist bet"een their ositions and duties, and insinuating that he did not "ant to 3oin the other e! loyees. He also ,uestioned the scheduled 2#00 .!. se!inars on Saturdays as they "ere not su osed to be doing a co! any acti'ity beyond 2#00 .!. He considers 2#00 .!. as the close of "or%ing hours on Saturdays$ thus, holding the! beyond 2#00 .!. "ould be in 'iolation of the la". 4his incident re'eals Dalangin)s lac% of interest in establishing a good "or%ing relationshi "ith his co1e! loyees, es ecially the ran% and file$ he did not "ant to 3oin the! because of his 'ie" that the se!inar "as not rele'ant to his osition and duties. (t also betrays his arrogant and condescending attitude to"ards his co1e! loyees, and a lac% of su ort for the co! any ob3ecti'e. Dalangin also e2hibited negati'e "or%ing habits, articularly "ith res ect to the one hour lunch brea% olicy of the co! any and the obser'ance of the co! any)s "or%ing hours. Dalangin "ould ta%e rolonged lunch brea%s or "ould go out of the office ? "ithout lea'e of the co! any ? and call the ersonnel !anager later only to say that he "ould be unable to return to the office because of so!e ersonal !atters he needs to attend to. ,anadian <pportunities Unlimited, Inc. vs. -art B. 3alangin, (r., G.R. o. !6'''$, 2ebruary ", '#!'. Procedural rules$ liberal a lication. *rdinarily, rules of rocedure are strictly enforced by courts in order to i! art stability in the legal syste!. Ho"e'er, in not a fe" instances, the Su re!e Court has rela2ed the rigid a lication of the rules of rocedure to afford the arties the o ortunity to fully 'entilate their cases on the !erits. 4his is in line "ith the ti!e honored rinci le that cases should be decided only after gi'ing all the arties the chance to argue their causes and defenses. (n that "ay, the ends of 3ustice "ould be better ser'ed. 9or indeed, the general ob3ecti'e of rocedure is to facilitate the a lication of 3ustice to the ri'al clai!s of contending arties, bearing al"ays in !ind that rocedure is not to hinder but to ro!ote the

ad!inistration of 3ustice. (n *ng Li! Sing, Jr. '. 9+; Leasing and 9inance Cor oration .8./. :o. 1>711B, June 7, 200A0, the Su re!e Court ruled# Courts ha'e the rerogati'e to rela2 rocedural rules of e'en the !ost !andatory character, !indful of the duty to reconcile both the need to s eedily ut an end to litigation and the arties) right to due rocess. (n nu!erous cases, this Court has allo"ed liberal construction of the rules "hen to do so "ould ser'e the de!ands of substantial 3ustice and e,uity. 2 2 2 (ndeed the re'ailing trend is to accord arty litigants the a! lest o ortunity for the ro er and 3ust deter!ination of their causes, free fro! the constraints of needless technicalities. (n this case, besides the fact that a denial of the recourse to the Court of A eals "ould ser'e !ore to er etuate an in3ustice and 'iolation of 4eng)s rights under our labor la"s, the Su re!e Court found that as correctly held by the Court of A eals, no intent to delay the ad!inistration of 3ustice could be attributed to 4eng. 4he Court of A eals therefore did not co!!it re'ersible error in e2cusing 4eng)s one1day delay in filing his !otion for reconsideration and in gi'ing due course to his etition for certiorari. egros )las*ers, Inc., Rodol5o ,. Alvare@ and /icente ?an vs. Alvin 0. ?eng, G.R. o. !%6!'', 2ebruary '', '#!'. /einstate!ent$ bac%"ages. +! loyees "ho are illegally dis!issed are entitled to full bac%"ages, inclusi'e of allo"ances and other benefits or their !onetary e,ui'alent, co! uted fro! the ti!e their actual co! ensation "as "ithheld fro! the! u to the ti!e of their actual reinstate!ent. ;ut if reinstate!ent is no longer ossible, the bac%"ages shall be co! uted fro! the ti!e of their illegal ter!ination u to the finality of the decision. 4hus, "hen there is an order of reinstate!ent, the co! utation of bac%"ages shall be rec%oned fro! the ti!e of illegal dis!issal u to the ti!e that the e! loyee is actually reinstated to his for!er osition. Pursuant to the order of reinstate!ent rendered by the Labor Arbiter, the ;an% of Lubao sent -anabat a letter re,uiring hi! to re ort bac% to "or% on -ay E, 200A. :ot"ithstanding the said letter, -anabat o ted not to re ort for "or%. 4hus, it is but fair that the bac%"ages to be a"arded to -anabat should be co! uted fro! the ti!e that he "as illegally dis!issed until the ti!e "hen he "as re,uired to re ort for "or%, i.e. fro! Se te!ber 1, 200B until -ay E, 200A. -an9 o5 0ubao, Inc. vs. Rommel (. Manabat, et al., G.R. o. !%%6'', 2ebruary !, '#!'. /einstate!ent$ doctrine of strained relations$ "hen a licable. Gnder the la" and re'ailing 3uris rudence, an illegally dis!issed e! loyee is entitled to reinstate!ent as a !atter of right. Ho"e'er, if reinstate!ent "ould only e2acerbate the tension and strained relations bet"een the arties, or "here the relationshi bet"een the e! loyer and the e! loyee has been unduly strained by reason of their irreconcilable differences, particularly w*ere t*e illegally dismissed employee *eld a managerial or 9ey position in t*e company , it "ould be !ore rudent to order ay!ent of se aration ay instead of reinstate!ent. Gnder the doctrine o5 strained relations, the ay!ent of se aration ay is considered an acce table alternati'e to reinstate!ent "hen the latter o tion is no longer desirable or 'iable. *n one hand, such ay!ent liberates the e! loyee fro! "hat could be a highly o ressi'e "or% en'iron!ent. *n the other hand, it releases the e! loyer fro! the grossly un alatable obligation of !aintaining in its e! loy a "or%er it could no longer trust. (n such cases, it should be ro'ed that the e! loyee concerned occu ies a osition "here he en3oys the trust and confidence of his e! loyer$ and that it is li%ely that if reinstated, an at!os here of anti athy and antagonis! !ay be generated as to ad'ersely affect the efficiency and roducti'ity of the e! loyee concerned. (n the resent case, the Su re!e Court found that the relations bet"een the arties had been already strained thereby 3ustifying the grant of se aration ay in lieu of reinstate!ent in fa'or of -anabat. -anabat)s reinstate!ent to his for!er osition "ould only ser'e to intensify the at!os here of anti athy and antagonis!

bet"een the arties. Gndoubtedly, ;an% of Lubao)s filing of 'arious cri!inal co! laints against -anabat for ,ualified theft and the subse,uent filing by the latter of the co! laint for illegal dis!issal against the for!er, ta%en together "ith the endency of the instant case for !ore than si2 years, had caused strained relations bet"een the arties. Considering that -anabat)s for!er osition as ban% encoder in'ol'es the handling of accounts of the de ositors of the ;an% of Lubao, it "ould not be e,uitable on the art of the ;an% of Lubao to be ordered to !aintain the for!er in its e! loy since it !ay only ins ire 'indicti'eness on the art of -anabat. Also, the refusal of -anabat to return to "or% is in itself an indication of the e2istence of strained relations bet"een hi! and the etitioner. -an9 o5 0ubao, Inc. vs. Rommel (. Manabat, et al., G.R. o. !%%6'', 2ebruary !, '#!'. Seafarers$ e! loy!ent contract$ erfection stage 's. co!!ence!ent stage. An e! loy!ent contract, li%e any other contract, is erfected at the !o!ent .10 the arties co!e to agree u on its ter!s$ and .20 concur in the essential ele!ents thereof# .a0 consent of the contracting arties, .b0 ob3ect certain "hich is the sub3ect !atter of the contract, and .c0 cause of the obligation. 4he ob3ect of the contract "as the rendition of ser'ice by 9antonial on board the 'essel for "hich ser'ice he "ould be aid the salary agreed u on. (n this case, the e! loy!ent contract "as erfected on January 1B, 2000 "hen it "as signed by the arties "ho entered into the contract in behalf of their rinci al. Ho"e'er, the e! loy!ent relationshi ne'er co!!enced since 9antonial "as not allo"ed to lea'e on January 1A, 2000 and go on board the 'essel -<F AGI in 8er!any on the ground that he "as not yet declared fit to "or% on the day of his scheduled de arture. ;ut, e'en if no e! loyer1e! loyee relationshi co!!enced, there "as, conte! oraneous "ith the erfection of the e! loy!ent contract, the birth of certain rights and obligations, the breach of "hich !ay gi'e rise to a cause of action against the erring arty. -rig*t Maritime ,orporation 1-M,4 / 3esiree P. ?enorio vs. Ricardo -. 2antonial, G.R. o. !"+&$+, 2ebruary %, '#!'.

'arch 2012 Philippine Supreme Court Decisions on Labor Law and Procedure
Posted on A ril 20, 2012 by Leslie C. Dy Here are select -arch 2012 rulings of the Su re!e Court of the Phili ines on labor la" and rocedure. Dis!issal$ constructi'e dis!issal. Constructi'e dis!issal e2ists "here there is cessation of "or% because continued e! loy!ent is rendered i! ossible, unreasonable or unli%ely, as an offer in'ol'ing a de!otion in ran% and a di!inution in ay. Constructi'e dis!issal is a dis!issal in disguise or an act a!ounting to dis!issal but !ade to a ear as if it "ere not. (n constructi'e dis!issal cases, the e! loyer is, concededly, charged "ith the burden of ro'ing that its conduct and action or the transfer of an e! loyee are for 'alid and legiti!ate grounds such as genuine business necessity. (n the instant case, the o'ert act relied u on by etitioner is not only a doubtful occurrence but is, if it did trans ire, e'en consistent "ith the dis!issal fro! e! loy!ent osited by the res ondent. 4he factual a raisal of the Court of A eals is correct. Petitioner "as dis leased after incurring e2 enses for res ondent)s !edical chec%1u and, it is

credible that, thereafter, res ondent "as re'ented entry into the "or% re!ises. 4his is tanta!ount to constructi'e dis!issal. 4he Su re!e Court agreed "ith the Court of A eals that the incredibility of etitioner)s sub!ission about abandon!ent of "or% renders credible the osition of res ondent that she "as re'ented fro! entering the ro erty. 4his "as e'en corroborated by the affida'its of Siarot and -endo5a "hich "ere !ade art of the records of this case. Ma. Melissa A. Galang vs. (ulia Malasu=ui, G.R. o. !68!6$. Marc* 6, '#!'. Dis!issal$ loss of trust and confidence. 4he rule is long and "ell settled that, in illegal dis!issal cases li%e the one at bench, the burden of roof is u on the e! loyer to sho" that the e! loyee)s ter!ination fro! ser'ice is for a 3ust and 'alid cause. 4he e! loyer)s case succeeds or fails on the strength of its e'idence and not on the "ea%ness of that adduced by the e! loyee, in %ee ing "ith the rinci le that the scales of 3ustice should be tilted in fa'or of the latter in case of doubt in the e'idence resented by the!. *ften described as !ore than a !ere scintilla, the ,uantu! of roof is substantial e'idence "hich is understood as such rele'ant e'idence as a reasonable !ind !ight acce t as ade,uate to su ort a conclusion, e'en if other e,ually reasonable !inds !ight concei'ably o ine other"ise. 9ailure of the e! loyer to discharge the foregoing onus "ould !ean that the dis!issal is not 3ustified and therefore illegal. (n the case at bar, the Su re!e Court agreed "ith the etitioners that !ere substantial e'idence and not roof beyond reasonable doubt is re,uired to 3ustify the dis!issal fro! ser'ice of an e! loyee charged "ith theft of co! any ro erty. Ho"e'er, the Court found no error in the CA)s findings that the etitioners had not ade,uately ro'en by substantial e'idence that Arlene and Jose h indeed artici ated or coo erated in the co!!ission of theft relati'e to the si2 !issing intensifying screens so as to 3ustify the latter)s ter!ination fro! e! loy!ent on the ground of loss of trust and confidence. -lue )9y ?rading ,ompany, Inc. et al. vs. Arlene P. -las and (osep* 3. )ilvano, G.R. o. !&#++&. Marc* 6, '#!'. Dis!issal$ robationary e! loyees. 8ala insists that he cannot be sanctioned for the theft of co! any ro erty on -ay 2B, 200>. He !aintains that he had no direct artici ation in the incident and that he "as not a"are that an illegal acti'ity "as going on as he "as at so!e distance fro! the truc%s "hen the alleged theft "as being co!!itted. He adds that he did not call the attention of the fore!en because he "as a !ere line!an and he "as focused on "hat he "as doing at the ti!e. He argues that in any e'ent, his !ere resence in the area "as not enough to !a%e hi! a cons irator in the co!!ission of the ilferage. 8ala !isses the oint. He forgets that as a robationary e! loyee, his o'erall 3ob erfor!ance and his beha'ior "ere being !onitored and !easured in accordance "ith the standards . i.e., the ter!s and conditions0 laid do"n in his robationary e! loy!ent agree!ent. Gnder aragra h 7 of the agree!ent, he "as sub3ect to strict co! liance "ith, and non1'iolation of the Co! any Code on +! loyee Disci line, Safety Code, rules and regulations and e2isting olicies. Par. 10 re,uired hi! to obser'e at all ti!es the highest degree of trans arency, selflessness and integrity in the erfor!ance of his duties and res onsibilities, free fro! any for! of conflict or contradicting "ith his o"n ersonal interest. Manila Electric ,ompany vs. (an ,arlo Gala, G.R. o. !&!'%%. Marc* 6, '#!'. Dis!issal$ relief of illegally dis!issed e! loyee. An illegally dis!issed e! loyee is entitled to t"o reliefs# bac% "ages and reinstate!ent. 4he t"o reliefs ro'ided are se arate and distinct. (n instances "here reinstate!ent is no longer feasible because of strained relations bet"een the e! loyee and the e! loyer, se aration ay is granted. (n effect, an illegally dis!issed e! loyee is entitled to either reinstate!ent if such is 'iable, or se aration ay if reinstate!ent is no longer

'iable, and to bac% "ages. 4he nor!al conse,uences of res ondent)s illegal dis!issal, then, are reinstate!ent "ithout loss of seniority rights, and ay!ent of bac% "ages co! uted fro! the ti!e co! ensation "as "ithheld fro! hi! u to the date of actual reinstate!ent. &here reinstate!ent is no longer 'iable as an o tion, se aration ay e,ui'alent to one !onth salary for e'ery year of ser'ice should be a"arded as an alternati'e. 4he ay!ent of se aration ay is in addition to ay!ent of bac% "ages. Petitioners ,uestion the CA /esolution dated *ctober 2E, 2007, arguing that it !odified its -arch =1, 2007 Decision "hich has already attained finality insofar as res ondent is concerned. Such contention is !is laced. 4he CA !erely clarified the eriod of ay!ent of bac% "ages and se aration ay u to the finality of its decision .-arch =1, 20070 !odifying the Labor Arbiter)s decision. (n 'ie" of the !odification of !onetary a"ards in the Labor Arbiter)s decision, the ti!e fra!e for the ay!ent of bac% "ages and se aration ay is accordingly !odified to the finality of the CA decision. or9is 3istribution, Inc., et al. vs. 3el5in ). 3escallar, G.R. o. !%+'++. Marc* !8, '#!' +! loyees$ ro3ect 's. regular e! loyees. 4he rinci al test for deter!ining "hether articular e! loyees are ro erly characteri5ed as C ro3ect e! loyeesD as distinguished fro! Cregular e! loyeesD is "hether or not the ro3ect e! loyees "ere assigned to carry out a Cs ecific ro3ect or underta%ing,D the duration and sco e of "hich "ere s ecified at the ti!e the e! loyees "ere engaged for that ro3ect. (n a nu!ber of cases, the Court has held that the length of ser'ice or the re1hiring of construction "or%ers on a ro3ect1to1 ro3ect basis does not confer u on the! regular e! loy!ent status, since their re1hiring is only a natural conse,uence of the fact that e2 erienced construction "or%ers are referred. +! loyees "ho are hired for carrying out a se arate 3ob, distinct fro! the other underta%ings of the co! any, the sco e and duration of "hich has been deter!ined and !ade %no"n to the e! loyees at the ti!e of the e! loy!ent are ro erly treated as ro3ect e! loyees and their ser'ices !ay be la"fully ter!inated u on the co! letion of a ro3ect. Should the ter!s of their e! loy!ent fail to co! ly "ith this standard, they cannot be considered ro3ect e! loyees. A lying the abo'e dis,uisition, the Court agreed "ith the findings of the CA that etitioners "ere ro3ect e! loyees. (t is not dis uted that etitioners "ere hired for the construction of the Cordo'a /eef Fillage /esort in Cordo'a, Cebu. ;y the nature of the contract alone, it is clear that etitioners) e! loy!ent "as to carry out a s ecific ro3ect. Ail5redo Aro, Ronilo ?irol, et al. vs. 0R,, 2ourt* 3ivision, et al., G.R. o. !686&'. Marc* 6, '#!'. Jurisdiction$ o"er of the D*L+ to deter!ine the e2istence of e! loyer1e! loyee relationshi . (f a co! laint is filed "ith the D*L+, and it is acco! anied by a clai! for reinstate!ent, the 3urisdiction is ro erly "ith the Labor Arbiter, under Art. 21A.=0 of the Labor Code, "hich ro'ides that the Labor Arbiter has original and e2clusi'e 3urisdiction o'er those cases in'ol'ing "ages, rates of ay, hours of "or%, and other ter!s and conditions of e! loy!ent, if acco! anied by a clai! for reinstate!ent. (n the resent case, the finding of the D*L+ /egional Director that there "as an e! loyer1 e! loyee relationshi has been sub3ected to re'ie" by the Su re!e Court, "ith the finding being that there "as no e! loyer1e! loyee relationshi bet"een etitioner and ri'ate res ondent, based on the e'idence resented. 4he D*L+ had no 3urisdiction o'er the case, as there "as no e! loyer1e! loyee relationshi resent. 4hus, the dis!issal of the co! laint

against etitioner is ro er. PeopleCs -roadcasting )ervice 1-ombo Rado P*ils., Inc.4 vs. ?*e )ecretary o5 t*e 3ept. o5 0abor F Employment, et al. G.R. o. !6&"+'. Marc* ", '#!'. -anage!ent rerogati'e$ resignation of e! loyees running for ublic office. 4he Su re!e Court has consistently held that so long as a co! any)s !anage!ent rerogati'es are e2ercised in good faith for the ad'ance!ent of the e! loyer)s interest and not for the ur ose of defeating or circu!'enting the rights of the e! loyees under s ecial la"s or under 'alid agree!ents, the Court "ill u hold the!. (n the instant case, A;S1C;: 'alidly 3ustified the i! le!entation of Policy :o. H/1+/101>. (t is "ell "ithin its rights to ensure that it !aintains its ob3ecti'ity and credibility and freeing itself fro! any a earance of i! artiality so that the confidence of the 'ie"ing and listening ublic in it "ill not be in any "ay eroded. +'en as the la" is solicitous of the "elfare of the e! loyees, it !ust also rotect the right of an e! loyer to e2ercise "hat are clearly !anage!ent rerogati'es. 4he free "ill of !anage!ent to conduct its o"n business affairs to achie'e its ur ose cannot be denied. Ernesto Embong vs. A-).,- -roadcasting ,orporation, /eranda )y F 3ante 0u@on, G.R. o. !%8%%+. Marc* 6, '#!'. Se aration ay$ ay!ent to those "ho artici ated in illegal stri%es. Se aration ay !ay be gi'en as a for! of financial assistance "hen a "or%er is dis!issed in cases such as the installation of labor1sa'ing de'ices, redundancy, retrench!ent to re'ent losses, closing or cessation of o eration of the establish!ent, or in case the e! loyee "as found to ha'e been suffering fro! a disease such that his continued e! loy!ent is rohibited by la". (t is a statutory right defined as the a!ount that an e! loyee recei'es at the ti!e of his se'erance fro! the ser'ice and is designed to ro'ide the e! loyee "ith the "here"ithal during the eriod that he is loo%ing for another e! loy!ent. (t is oriented to"ards the i!!ediate future, the transitional eriod the dis!issed e! loyee !ust undergo before locating a re lace!ent 3ob. As a general rule, "hen 3ust causes for ter!inating the ser'ices of an e! loyee e2ist, the e! loyee is not entitled to se aration ay because la"brea%ers should not benefit fro! their illegal acts. 4he rule, ho"e'er, is sub3ect to e2ce tions. Here, not only did the Court declare the stri%e illegal, rather, it also found the Gnion officers to ha'e %no"ingly artici ated in the illegal stri%e. &orse, the Gnion !e!bers co!!itted rohibited acts during the stri%e. 4hus, as the Court has concluded in other cases it has re'iously decided, such Gnion officers are not entitled to the a"ard of se aration ay in the for! of financial assistance. ,. Alcantara F )ons, Inc. vs. ,ourt o5 Appeals, et al./ ag9a*iusang Mamumuo sa Alsons.)P20, et al. vs. ,. Alcantara F )ons, Inc., et al./ ag9a*iusang Mamumuo sa Alsons.)P20, et al. vs. ,. Alcantara F )ons, Inc., et al. G.R. o. !++!#&/G.R. o. !++!$+/G.R. o. !6&''#. Marc* !8, '#!'.

April 2012 Philippine Supreme Court Decisions on Labor Law and Procedure
Posted on -ay 10, 2012 by Leslie C. Dy Here are select A ril 2012 rulings of the Su re!e Court of the Phili ines on labor la" and rocedure#

Dis!issal$ due rocess. &hen the Labor Code s ea%s of rocedural due rocess, the reference is usually to the t"o .201"ritten notice rule en'isaged in Section 2 .(((0, /ule KK(((, ;oo% F of the *!nibus /ules (! le!enting the Labor Code. -88 -arine Ser'ices, (nc. '. :L/C tersely described the !echanics of "hat !ay be considered a t"o1 art due rocess re,uire!ent "hich includes the t"o1notice rule, C2 2 2 one, of the intention to dis!iss, indicating therein his acts or o!issions co! lained against, and t"o, notice of the decision to dis!iss$ and an o ortunity to ans"er and rebut the charges against hi!, in bet"een such notices.D Here, the first and second notice re,uire!ents ha'e not been ro erly obser'ed. 4he ad'erted !e!o "ould ha'e had constituted the Ccharge sheet,D sufficient to ans"er for the first notice re,uire!ent, but for the fact that there is no roof such letter had been sent to and recei'ed by hi!. :either "as there co! liance "ith the i! erati'es of a hearing or conference. Suffice it to oint out that the record is de'oid of any sho"ing of a hearing or conference ha'ing been conducted. And the "ritten notice of ter!ination itself did not indicate all the circu!stances in'ol'ing the charge to 3ustify se'erance of e! loy!ent. 9or 'iolating etitioner)s right to due rocess, the Su re!e Court ordered the ay!ent to etitioner of the a!ount of P=0,000 as no!inal da!ages. Armando Ailing vs. (ose -. 2eliciano, Manuel 2. )an Mateo III, et al., G.R. o. !%+%'&. April '+, '#!'. Dis!issal$ 3ust cause. (n fine, an e! loyee)s failure to !eet sales or "or% ,uotas falls under the conce t of gross inefficiency, "hich in turn is analogous to gross neglect of duty that is a 3ust cause for dis!issal under Article 272 of the Code. Ho"e'er, in order for the ,uota i! osed to be considered a 'alid roducti'ity standard and thereby 'alidate a dis!issal, !anage!ent)s rerogati'e of fi2ing the ,uota !ust be e2ercised in good faith for the ad'ance!ent of its interest. 4he duty to ro'e good faith, ho"e'er, rests "ith &&&+C as art of its burden to sho" that the dis!issal "as for a 3ust cause. &&&+C !ust sho" that such ,uota "as i! osed in good faith. 4his &&&+C failed to do, erce tibly because it could not. 4he fact of the !atter is that the alleged i! osition of the ,uota "as a des erate atte! t to lend a se!blance of 'alidity to Aliling)s illegal dis!issal. Armando Ailing vs. (ose -. 2eliciano, Manuel 2. )an Mateo III, et al., G.R. o. !%+%'&. April '+, '#!'. Dis!issal$ retrench!ent. /etrench!ent is a 'alid e2ercise of !anage!ent rerogati'e sub3ect to the strict re,uire!ents set by 3uris rudence, to "it# .10 4hat the retrench!ent is reasonably necessary and li%ely to re'ent business losses "hich, if already incurred, are not !erely de minimis, but substantial, serious, actual and real, or if only e2 ected, are reasonably i!!inent as ercei'ed ob3ecti'ely and in good faith by the e! loyer$ .20 4hat the e! loyer ser'ed "ritten notice both to the e! loyees and to the De art!ent of Labor and +! loy!ent at least one !onth rior to the intended date of retrench!ent$ .=0 4hat the e! loyer ays the retrenched e! loyees se aration ay e,ui'alent to one !onth ay or at least U !onth ay for e'ery year of ser'ice, "hiche'er is higher$ .E0 4hat the e! loyer e2ercises its rerogati'e to retrench e! loyees in good faith for the ad'ance!ent of its interest and not to defeat or circu!'ent the e! loyees) right to security of tenure$ and

.B0 4hat the e! loyer used fair and reasonable criteria in ascertaining "ho "ould be dis!issed and "ho "ould be retained a!ong the e! loyees, such as status, 2 2 2 efficiency, seniority, hysical fitness, age, and financial hardshi for certain "or%ers. As a tly found by the :L/C and 3ustly sustained by the CA, Petrocon e2ercised its rerogati'e to retrench its e! loyees in good faith and the considerable reduction of "or% allot!ents of Petrocon by Saudi Ara!co "as sufficient basis for Petrocon to reduce the nu!ber of its ersonnel. As for the notice re,uire!ent, ho"e'er, contrary to etitioner)s contention, ro er notice to the D*L+ "ithin =0 days rior to the intended date of retrench!ent is necessary and !ust be co! lied "ith des ite the fact that res ondent is an o'erseas 9ili ino "or%er. (n the resent case, although res ondent "as duly notified of his ter!ination by Petrocon =0 days before its effecti'ity, no allegation or roof "as ad'anced by etitioner to establish that Petrocon e'er sent a notice to the D*L+ =0 days before the res ondent "as ter!inated. 4hus, this re,uire!ent of the la" "as not co! lied "ith. Des ite the fact that res ondent "as e! loyed by Petrocon as an *9& in Saudi Arabia, still both he and his e! loyer are sub3ect to the ro'isions of the Labor Code "hen a licable. 4he basic olicy in this 3urisdiction is that all 9ili ino "or%ers, "hether e! loyed locally or o'erseas, en3oy the rotecti'e !antle of Phili ine labor and social legislations .citing P*ilippine ational -an9 v. ,abansag, 8./. :o. 1BA010, June 21, 200B, E>0 SC/A B1E, B17 and Royal ,rown Internationale v. 0R,, 8./. :o. A707B, *ctober 1>, 1676, 1A7 SC/A B>6.0 International Management )ervices/Marilyn ,. Pascual vs. Roel P. 0ogarta, G.R. o. !"$"+6, April !%, '#!'. +! loyee$ robationary e! loyee. 4he afore,uoted Section > of the (! le!enting /ules of ;oo% F(, /ule F(((1A of the Code s ecifically re,uires the e! loyer to infor! the robationary e! loyee of such reasonable standards at the ti!e of his engage!ent, not at any ti!e later$ else, the latter shall be considered a regular e! loyee. 4hus, ursuant to the e2 licit ro'ision of Article 271 of the Labor Code, Section >.d0 of the (! le!enting /ules of ;oo% F(, /ule F(((1A of the Labor Code and settled 3uris rudence, etitioner Aliling is dee!ed a regular e! loyee as of June 11, 200E, the date of his e! loy!ent contract. 4he letter1offer to Aliling states that the regulari5ation standards or the erfor!ance nor!s to be used are still to be agreed u on by hi! and his su er'isor. -oreo'er, Aliling "as assigned to 8K truc%ing sales, an acti'ity entirely different to the Seafreight Sales for "hich he "as originally hired and trained for. (n the resent case, there "as no roof that Aliling "as infor!ed of the standards for his continued e! loy!ent, such as the sales ,uota, at the ti!e of his engage!ent. Armando Ailing vs. (ose -. 2eliciano, Manuel 2. )an Mateo III, et al., G.R. o. !%+%'&. April '+, '#!'. +! loyee$ se aration ac%age. Article 27= of the Labor Code ro'ides only the re,uired !ini!u! a!ount of se aration ay, "hich e! loyees dis!issed for any of the authori5ed causes are entitled to recei'e. +! loyers, therefore, ha'e the right to create lans, ro'iding for se aration ay in an a!ount o'er and abo'e "hat is i! osed by Article 27=. 4here is nothing therein that rohibits e! loyers and e! loyees fro! contracting on the ter!s of e! loy!ent, or fro! entering into agree!ents on e! loyee benefits, so long as they do not 'iolate the Labor Code or any other la", and are not contrary to !orals, good custo!s, ublic order, or ublic olicy. Conse,uently, etitioners are not allo"ed to recei'e se aration ay fro! both the Labor Code, on the one hand, and the :e" 8ratuity Plan and the SSP, on the other, they "ould recei'e double

co! ensation for the sa!e cause .i.e., se aration fro! the ser'ice due to redundancy0. Ma. ,orina ,. (iao, et al. vs. Global -usiness -an9, Inc., et al., G.R. o. !%'$$!, April !%, '#!'. +! loyer1e! loyee relationshi . (n deter!ining the resence or absence of an e! loyer1 e! loyee relationshi , the Court has consistently loo%ed for the follo"ing incidents, to "it# .a0 the selection and engage!ent of the e! loyee$ .b0 the ay!ent of "ages$ .c0 the o"er of dis!issal$ and .d0 the e! loyer)s o"er to control the e! loyee on the !eans and !ethods by "hich the "or% is acco! lished. 4he last ele!ent, the so1called control test, is the !ost i! ortant ele!ent. (t can be deduced fro! the -arch 166> affida'it of etitioner that res ondents challenged his authority to deli'er so!e 1B7 chec%s to S9C. Considering that etitioner contested res ondents) challenge by ointing to the e2isting arrange!ents bet"een ;CC and S9C, it should be clear that res ondents did not e2ercise the o"er of control o'er etitioner, because he thereby acted for the benefit and in the interest of S9C !ore than of ;CC. ,*arlie (ao vs. -,, Products )ales, Inc. and ?errance ?y, G.R. o. !"$6##, April !%, '#!'. Pro3ect e! loyee$ con'ersion into regular e! loyee. (n all the =7 ro3ects "here D-C( engaged Ja!in)s ser'ices, the tas%s he erfor!ed as a car enter "ere indis utably necessary and desirable in D-C()s construction business. He !ight not ha'e been a !e!ber of a "or% ool since D-C( insisted that it does not !aintain a "or% ool, but his continuous rehiring in =7 ro3ects o'er a eriod of =1 years and the nature of his "or% un!ista%ably !ade hi! a regular e! loyee. (n -araguinot, Jr. '. :L/C, =E7 Phil. B70 .16670, the Court held that once a ro3ect or "or% ool e! loyee has been# .10 continuously, as o osed to inter!ittently, rehired by the sa!e e! loyer for the sa!e tas%s or nature of tas%s$ and .20 these tas%s are 'ital, necessary and indis ensable to the usual business or trade of the e! loyer, then the e! loyee !ust be dee!ed a regular e! loyee. Surely, length of ti!e is not the controlling test for ro3ect e! loy!ent but it is 'ital in deter!ining if the e! loyee "as hired for a s ecific underta%ing or if it is tas%ed to erfor! functions 'ital, necessary and indis ensable to the usual business or trade of the e! loyer. Here, M ri'ateN res ondent had been a ro3ect e! loyee se'eral ti!es o'er. 4he nature of his e! loy!ent ceased to be ro3ect1based "hen he "as re eatedly re1hired due to the de!ands of etitioner)s business. 3.M. ,onsunHi, Inc. and/or 3avid M. ,onsunHi vs. Estelito, G.R. o. !&'+!8, April !%, '#!'. Dis!issal$ "illful disobedience. 9or "illful disobedience to be a 'alid cause for dis!issal, these t"o ele!ents !ust concur# .10 the e! loyee)s assailed conduct !ust ha'e been "illful, that is, characteri5ed by a "rongful and er'erse attitude$ and .20 the order 'iolated !ust ha'e been reasonable, la"ful, !ade %no"n to the e! loyee, and !ust ertain to the duties "hich he had been engaged to discharge. 4he etitioner)s arbitrary defiance to 8ra hics, (nc.)s order for hi! to render o'erti!e "or% constitutes "illful disobedience. ;ecause of his refusal to render o'erti!e "or%, the co! any failed to !eet its rinting deadlines, resulting in losses to the co! any. 4he Su re!e Court too% into account the fact that etitioner "as inclined to absent hi!self and to re ort late for "or% des ite being re'iously enali5ed, and affir!ed the CA)s ruling that the etitioner is indeed utterly defiant of the la"ful orders and the reasonable "or% standards rescribed by his e! loyer. 4he Court reiterated its re'ious rulings stating that an e! loyer has the right to re,uire the erfor!ance of o'erti!e ser'ice in any of the situations conte! lated under Article

76 of the Labor Code and an e! loyee)s non1co! liance is "illful disobedience. Realda v. ew Age Grap*ics, Inc. et. al. G.R. o. !&'!&#, April '+, '#!'. Dis!issal$ inefficiency. 4he etitioner)s failure to obser'e 8ra hics, (nc.)s "or% standards constitutes inefficiency that is a 'alid cause for dis!issal. 9ailure to obser'e rescribed standards of "or%, or to fulfill reasonable "or% assign!ents due to inefficiency !ay constitute 3ust cause for dis!issal. Such inefficiency is understood to !ean failure to attain "or% goals or "or% ,uotas, either by failing to co! lete the sa!e "ithin the alloted reasonable eriod, or by roducing unsatisfactory results. As the o erator of 8ra hics, (nc.)s rinter, he is !andated to chec% "hether the colors that "ould be rinted are in accordance "ith the client)s s ecifications and for hi! to do so, he !ust consult the 8eneral -anager and the color guide used by 8ra hics, (nc. before !a%ing a full run. 4he e! loyee in this case failed to obser'e this si! le rocedure and roceeded to rint "ithout !a%ing sure that the colors "ere at ar "ith the client)s de!ands. 4his resulted to delays in the deli'ery of out ut, client dissatisfaction, and additional costs to 8ra hics, (nc.. Realda v. ew Age Grap*ics, Inc. et. al. G.R. o. !&'!&#, April '+, '#!'. Dis!issal$ due rocess. (n Ding o5 Dings ?ransport, Inc. v. Mamac, this Court laid do"n the !anner by "hich the rocedural due re,uire!ents of due rocess can be satisfied# .10 4he #irst written notice to be ser'ed on the e! loyees should contain the s ecific causes or grounds for ter!ination against the!, and a directi'e that the e! loyees are gi'en the o ortunity to sub!it their "ritten e2 lanation "ithin a reasonable eriod. C/easonable o ortunityD under the *!nibus /ules !eans e'ery %ind of assistance that !anage!ent !ust accord to the e! loyees to enable the! to re are ade,uately for their defense. 4his should be construed as a eriod of at least fi'e .B0 calendar days fro! recei t of the notice to gi'e the e! loyees an o ortunity to study the accusation against the!, consult a union official or la"yer, gather data and e'idence, and decide on the defenses they "ill raise against the co! laint. -oreo'er, in order to enable the e! loyees to intelligently re are their e2 lanation and defenses, the notice should contain a detailed narration of the facts and circu!stances that "ill ser'e as basis for the charge against the e! loyees. A general descri tion of the charge "ill not suffice. 0astly, the notice should s ecifically !ention "hich co! any rules, if any, are 'iolated and<or "hich a!ong the grounds under Art. 272 is being charged against the e! loyees. .20 After ser'ing the first notice, the e! loyers should schedule and conduct a hearing or con#erence "herein the e! loyees "ill be gi'en the o ortunity to# .a0 e2 lain and clarify their defenses to the charge against the!$ .b0 resent e'idence in su ort of their defenses$ and .c0 rebut the e'idence resented against the! by the !anage!ent. During the hearing or conference, the e! loyees are gi'en the chance to defend the!sel'es ersonally, "ith the assistance of a re resentati'e or counsel of their choice. -oreo'er, this conference or hearing could be used by the arties as an o ortunity to co!e to an a!icable settle!ent. .=0 After deter!ining that ter!ination of e! loy!ent is 3ustified, the e! loyers shall ser'e the e! loyees a written notice o# termination indicating that# .10 all circu!stances in'ol'ing the charge against the e! loyees ha'e been considered$ and .20 grounds ha'e been established to 3ustify the se'erance of their e! loy!ent. 8ra hics, (nc. failed to afford the etitioner "ith a reasonable o ortunity to be heard and defend itself. An ad!inistrati'e hearing set on the sa!e day that the etitioner recei'ed the !e!orandu! and the 2E1hour eriod gi'en to hi! to sub!it a "ritten e2 lanation is far fro! reasonable. 9urther!ore, there is no indication that 8ra hics, (nc. issued a second notice,

infor!ing the etitioner of his dis!issal. 8ra hics, (nc. ad!itted that it decided to ter!inate the etitioner)s e! loy!ent "hen he ceased to re ort for "or% after being ser'ed "ith the !e!orandu! re,uiring hi! to e2 lain and subse,uent to his failure to sub!it a "ritten e2 lanation. Ho"e'er, there is nothing on record sho"ing that 8ra hics, (nc. laced its decision to dis!iss in "riting and that a co y thereof "as sent to the etitioner. :ot"ithstanding the e2istence of a 3ust cause to ter!inate etitioner)s e! loy!ent, res ondent "as ordered to ay P=0,000 as no!inal da!ages for 'iolation of the e! loyee)s right to due rocess. Realda v. ew Age Grap*ics, Inc. et. al. G.R. o. !&'!&#, April '+, '#!'. Dis!issal$ "illful disobedience. &illful disobedience re,uires the concurrence of t"o ele!ents# .10 the e! loyee)s assailed conduct !ust ha'e been "illful, that is, characteri5ed by a "rongful and er'erse attitude$ and .20 the order 'iolated !ust ha'e been reasonable, la"ful, !ade %no"n to the e! loyee, and !ust ertain to the duties "hich he had been engaged to discharge. ;oth ele!ents are resent in this case. 9irst, at no oint did the dis!issed e! loyees deny Iings oint +2 ress) clai! that they refused to co! ly "ith the directi'e for the! to sub!it to a drug test or, at the 'ery least, e2 lain their refusal. 4his gi'es rise to the i! ression that their non1co! liance is deliberate. 4he utter lac% of reason or 3ustification for their insubordination indicates that it "as ro! ted by !ere obstinacy, hence, "illful thereby 3ustifying their dis!issal. Second, that the co! any)s order to undergo a drug test is necessary and rele'ant in the erfor!ance of etitioners) functions as dri'ers of Iings oint +2 ress is ob'ious. As the :L/C correctly ointed out, dri'ers are indis ensable to Iings oint +2 ress) ri!ary business of rendering door1to1door deli'ery ser'ices. (t is co!!on %no"ledge that the use of dangerous drugs has ad'erse effects on dri'ing abilities that !ay render e! loyees inca able of erfor!ing their duties. :ot only are they acting against the interests of Iings oint +2 ress, they also ose a threat to the ublic. Da9ampi and its members, et al. v. Dingspoint E7press and 0ogistic and/or Mary Ann ,o, G.R. o. !&8%!$, April '+, '#!'. Dis!issal$ rocedural due rocess re,uire!ents. &hile Iings oint +2 ress had reason to se'er etitioners) e! loy!ent, this Court finds its su osed obser'ance of the re,uire!ents of rocedural due rocess retentious. &hile Iings oint +2 ress re,uired the dis!issed e! loyees to e2 lain their refusal to sub!it to a drug test, the t"o .20 days afforded to the! to do so cannot ,ualify as Creasonable o ortunityD, "hich the Court construed in Iing of Iings 4rans ort, (nc. '. -a!ac as a eriod of at least fi'e .B0 calendar days fro! recei t of the notice. 4hus, e'en if a 3ust cause e2ists for the dis!issal of etitioners, Iings oint +2 ress is still liable to inde!nify the dis!issed e! loyees, "ith the e2ce tion of Panuelos, Di5on and Di!abayao, "ho did not a eal the dis!issal of their co! laints, "ith no!inal da!ages in the a!ount of P=0,000.00. Da9ampi and its members, et al. v. Dingspoint E7press and 0ogistic and/or Mary Ann ,o, G.R. o. !&8%!$, April '+, '#!'.

June 2012 Philippine Supreme Court Decisions on Labor Law and Procedure
Posted on July 20, 2012 by Leslie C. Dy

Here are select June 2012 rulings of the Su re!e Court of the Phili ine on labor la" and rocedure# A eal$ issue of e! loyer1e! loyee relationshi raised for the first ti!e on a eal. (t is a funda!ental rule of rocedure that higher courts are recluded fro! entertaining !atters neither alleged in the leadings nor raised during the roceedings belo", but 'entilated for the first ti!e only in a !otion for reconsideration or on a eal. 4he alleged absence of e! loyer1e! loyee relationshi cannot be raised for the first ti!e on a eal. 4he resolution of this issue re,uires the ad!ission and calibration of e'idence and the LA and the :L/C did not ass u on it in their decisions. Petitioner is bound by its sub!issions that res ondent is its e! loyee and it should not be er!itted to change its theory. Such change of theory cannot be tolerated on a eal, not on account of the strict a lication of rocedural rules, but as a !atter of fairness. 3uty 2ree P*ilippines )ervices, Inc. vs. Manolito B. ?ria. 8./. :o. 1AE706. June 2A, 2012. Dis!issal$ abandon!ent. Abandon!ent cannot be inferred fro! the actuations of res ondent. &hen he disco'ered that his ti!e card "as off the rac%, he i!!ediately in,uired fro! his su er'isor. He later sought the assistance of his counsel, "ho "rote a letter addressed to Polyfoa! re,uesting that he be re1ad!itted to "or%. &hen said re,uest "as not acted u on, he filed the instant illegal dis!issal case. 4hese circu!stances clearly negate the intention to abandon his "or%. Poly5oam.RG, International, ,orporation and Precilla A. GramaHe vs. Edgardo ,oncepcion. 8./. :o. 1A2=E6, June 1=, 2012. Dis!issal$ due rocess. 4o !eet the re,uire!ents of due rocess in the dis!issal of an e! loyee, an e! loyer !ust furnish the "or%er "ith t"o "ritten notices# .10 a "ritten notice s ecifying the grounds for ter!ination and gi'ing to said e! loyee a reasonable o ortunity to e2 lain his side and .20 another "ritten notice indicating that, u on due consideration of all circu!stances, grounds ha'e been established to 3ustify the e! loyer)s decision to dis!iss the e! loyee. 4he la" does not re,uire that an intention to ter!inate one)s e! loy!ent should be included in the first notice. (t is enough that e! loyees are ro erly a rised of the charges brought against the! so they can ro erly re are their defenses. (t is only during the second notice that the intention to ter!inate one)s e! loy!ent should be e2 licitly stated. 4he guiding rinci les in connection "ith the hearing re,uire!ent in dis!issal cases are the follo"ing# 1. CA! le o ortunity to be heardD !eans any !eaningful o ortunity .'erbal or "ritten0 gi'en to the e! loyee to ans"er the charges against hi! and sub!it e'idence in su ort of his defense, "hether in a hearing, conference or so!e other fair, 3ust and reasonable "ay. 2. A for!al hearing or conference beco!es !andatory only "hen re,uested by the e! loyee in "riting or substantial e'identiary dis utes e2ist or a co! any rule or ractice re,uires it, or "hen si!ilar circu!stances 3ustify it. =. 4he Ca! le o ortunity to be heardD standard in the Labor Code re'ails o'er the Chearing or conferenceD re,uire!ent in the i! le!enting rules and regulations. 4he e2istence of an actual, for!al Ctrial1ty eD hearing, although referred, is not absolutely necessary to satisfy the e! loyee)s right to be heard. +sguerra "as able to resent her defenses$ and only u on ro er consideration of it did Falle Ferde send the second !e!orandu! ter!inating her e! loy!ent. Since Falle Ferde co! lied "ith the t"o1notice re,uire!ent, no

rocedural defect e2ists in +sguerra)s ter!ination. 3olores ?. Esguerra vs. /alle /erde ,ountry ,lub, Inc. and Ernesto /illaluna. 8./. :o. 1A=012, June 1=, 2012. Dis!issal$ loss of trust and confidence. 4here are t"o .20 classes of ositions of trust. 4he first class consists of !anagerial e! loyees, or those 'ested "ith the o"er to lay do"n !anage!ent olicies$ and the second class consists of cashiers, auditors, ro erty custodians or those "ho, in the nor!al and routine e2ercise of their functions, regularly handle significant a!ounts of !oney or ro erty. +sguerra held the osition of Cost Control Su er'isor and had the duty to re!it to the accounting de art!ent the cash sales roceeds fro! e'ery transaction she "as assigned to. 4his is not a routine tas% that a regular e! loyee !ay erfor!$ it is related to the handling of business e2 enditures or finances. 9or this reason, +sguerra occu ies a osition of trust and confidence ? a osition enu!erated in the second class of ositions of trust. Any breach of the trust i! osed u on her can be a 'alid cause for dis!issal. Loss of confidence as a 3ust cause for ter!ination of e! loy!ent can be in'o%ed "hen an e! loyee holds a osition of res onsibility, trust and confidence. (n order to constitute a 3ust cause for dis!issal, the act co! lained of !ust be related to the erfor!ance of the duties of the dis!issed e! loyee and !ust sho" that he or she is unfit to continue "or%ing for the e! loyer for 'iolation of the trust re osed in hi! or her. (t "as +sguerra)s res onsibility to account for the cash roceeds$ in case of roble!s, she should ha'e ro! tly re orted it, regardless of "ho "as at fault. (nstead, she settled the unaccounted a!ount only after the accounting de art!ent infor!ed her about the discre ancy, al!ost one !onth follo"ing the incident. +sguerra)s failure to !a%e the ro er re ort reflects her irres onsibility in the custody of cash for "hich she "as accountable. Dolores 4. +sguerra 's. Falle Ferde Country Club, (nc. and +rnesto Fillaluna. 8./. :o. 1A=012, June 1=, 2012. Dis!issal$ serious !isconduct and loss of trust and confidence. De3an is liable for 'iolation of Section A, aragra hs E and 11 of the Co! any Code of +! loyee Disci line, constituting serious !isconduct, fraud and "illful breach of trust of the e! loyer, "hich are 3ust causes for ter!ination of e! loy!ent under the la". 4here is no dis ute about the release of the !eter soc%ets. Also, the ersons in'ol'ed "ere clearly identified ? De3an$ 8o5arin, a ri'ate electrician "ho recei'ed the !eter soc%ets$ /eyes, the o"ner of the 3ee "here the !eter soc%ets "ere loaded by 8o5arin$ Duenas, a -eralco field re resentati'e$ and De ante, another ri'ate electrician "ho ur ortedly o"ned the !eter soc%ets. 4he release by De3an of the !eter soc%ets to 8o5arin "ithout the "ritten authority or SPA fro! the custo!er or custo!ers "ho a lied for electric connection .as a !atter of co! any olicy0 ser'ed as a %ey ele!ent in ro'ing the ri'ate contracting acti'ity for electric ser'ice connection being underta%en by De3an and Duenas. -oreo'er, it "as bad enough that De3an failed to as% for a "ritten authori5ation fro! the custo!ers for the release of the !eter soc%ets as re,uired by co! any olicy, but the elaborate sche!e ursued by De3an in concert "ith Duenas, "ere all underta%en to defraud -eralco. Hence, -eralco had 'alid reasons for losing its trust and confidence in De3an. He is no ordinary e! loyee. As branch re resentati'e, he "as rinci ally charged "ith the function and res onsibility to acce t ay!ent of fees re,uired for the installation of electric ser'ice and facilitate issuance of !eter soc%ets. 4he duties of his osition re,uire hi! to al"ays act "ith the highest degree of honesty, integrity and sincerity, as the co! any uts it. (n light of his fraudulent act, -eralco, an enter rise i!bued "ith ublic interest, cannot be co! elled to continue De3an)s e! loy!ent, as it "ould be ini!ical to its interest. Manila Electric ,ompany 1Meralco4 vs. >erminigildo >. 3eHan. 8./. :o. 16E10>, June 17, 2012.

+! loyee benefit$ attorney)s fees. La5aro !ust establish a legal basis ? either by la", contract or other sources of obligations ? to !erit the recei t of the additional 10H attorney)s fees collected in the 'arious foreclosure rocedures he settled as the ban%)s legal officer. La5aro has not roduced any contract or ro'ision of la" that "ould "arrant the ay!ent of the additional attorney)s fees. He is only entitled to his salaries as the ban%)s legal officer, because the ser'ices he rendered in the foreclosure roceedings "ere art of his official tas%s. -anco 2ilipino )avings and Mortgage -an9 vs. Miguelito M. 0a@aro/Miguelito M. 0a@aro vs. -anco 2ilipino )avings and Mortgage -an9, et al. 8./. :o. 17B=E> V 8./. :o. 17BEE2. June 2A, 2012. +! loyee benefit$ retire!ent ay. ;anco 9ili ino !aintains that the se'en1year eriod "hen it "as under li,uidation should not be credited in co! uting La5aro)s retire!ent ay because, during that eriod, the ban% "as considered closed. 4he Su re!e Court held that ban%s under li,uidation retain their legal ersonality. (n fact, e'en if they are rohibited fro! conducting regular ban%ing business, it is necessary that debts o"ed to the! be collected. La5aro erfor!ed the duty of foreclosing debts in fa'or of ;anco 9ili ino. (t cannot rightfully disclai! La5aro)s "or% that benefitted it. As found in the (! le!enting /ules of the /etire!ent Pay La" and in 3uris rudence, only in the absence of an a licable retire!ent agree!ent shall Article 27A of the Labor Code a ly. 4here is a proviso ho"e'er, that an e! loyee)s retire!ent benefits under any agree!ent shall not be less than those ro'ided in the said article. 4he /ules of the ;anco 9ili ino /etire!ent 9und do not ro'ide for benefits lo"er than those in the Labor Code. (n fact, the ban% offers a retire!ent ay e,ui'alent to one andone1half !onth salary for e'ery year of ser'ice, a rate o'er and abo'e the one1half !onth salary threshold ro'ided by the la". Although the /ules of the ;anco 9ili ino /etire!ent 9und do not grant a rounding off sche!e, they nonetheless ro'ide that rorated credit shall be gi'en for inco! lete years, regardless of the fraction of !onths in the retiree)s length of ser'ice. :ot"ithstanding the lac% of a rounding1u ro'ision, still, the higher retire!ent ay, together "ith the rorated crediting, cannot be dee!ed to be less fa'orable than that ro'ided for by the la". Glti!ately, the !ore i! ortant threshold to be considered in construing "hether the retire!ent agree!ent ro'ides less benefits, co! ared to those ro'ided by the /etire!ent Pay La", is that the retire!ent benefits in the said agree!ent should at least a!ount to one1half of the e! loyee)s !onthly salary. -anco 2ilipino )avings and Mortgage -an9 vs. Miguelito M. 0a@aro/Miguelito M. 0a@aro vs. -anco 2ilipino )avings and Mortgage -an9, et al. 8./. :o. 17B=E> V 8./. :o. 17BEE2. June 2A, 2012 +! loyee dis!issal. &hen the floating status of e! loyees lasts for !ore than si2 .>0 !onths, they !ay be considered to ha'e been illegally dis!issed fro! the ser'ice. C9loating statusD !eans an indefinite eriod of ti!e "hen one does not recei'e any salary or financial benefit ro'ided by la". (n this case, etitioners "ere actually reassigned to ne" osts, albeit in a different location fro! "here they resided. 4hus, there can be no floating status or indefinite eriod to s ea% of. (nstead, etitioners "ere the ones "ho refused to re ort for "or% in their ne" assign!ent. (n cases in'ol'ing security guards, a relief and transfer order in itself does not se'er the e! loy!ent relationshi bet"een the security guards and their agency. +! loyees ha'e the right to security of tenure, but this does not gi'e the! such a 'ested right to their ositions as "ould de ri'e the co! any of its rerogati'e to change their assign!ent or transfer the! "here their ser'ices, as security guards, "ill be !ost beneficial to the client. An e! loyer has the right to transfer or assign its e! loyees fro! one office or area of o eration to another in ursuit of its legiti!ate business interest, ro'ided there is no de!otion in ran% or di!inution of salary,

benefits, and other ri'ileges$ and the transfer is not !oti'ated by discri!ination or bad faith, or effected as a for! of unish!ent or de!otion "ithout sufficient cause. &hile etitioners !ay clai! that their transfer to -anila "ill cause added e2 enses and incon'enience, absent any sho"ing of bad faith or ill !oti'e on the art of the e! loyer, the transfer re!ains 'alid. )alvador <. MoHar, et al. vs. Agro ,ommercial )ecurity )ervice Agency, et al. 8./. :o. 17A177, June 2A, 2012. +! loyee dis!issal$ burden of roof. Gnder the la", the burden of ro'ing that the ter!ination of e! loy!ent "as for a 'alid or authori5ed cause rests on the e! loyer. 9ailure to discharge this burden "ould result in an un3ust or illegal dis!issal. 4he co! any)s e'idence on the res ondents) alleged infractions do not substantially sho" that they 'iolated co! any rules and regulations to "arrant their dis!issal. (t is ob'ious that the co! any o'erste ed the bounds of its !anage!ent rerogati'e in the dis!issal of -auricio and Ca!acho. (t lost sight of the rinci le that !anage!ent rerogati'e !ust be e2ercised in good faith and "ith due regard to the rights of the "or%ers in the s irit of fairness and "ith 3ustice in !ind. P*ilbag Industrial Manu5acturing ,orp. vs. P*ilbag Aor9ers Union.0a9as at Gabay ng Manggagawang ag9a9aisa. 8./. :o. 172E7>, June 20, 2012. +! loyee dis!issal$ due rocess. /etrench!ent is sub3ect to faithful co! liance "ith the substanti'e and rocedural re,uire!ents laid do"n by la" and 3uris rudence. 9or a 'alid retrench!ent, the follo"ing ele!ents !ust be resent# 1. 4hat retrench!ent is reasonably necessary and li%ely to re'ent business losses "hich, if already incurred, are not !erely de !ini!is, but substantial, serious, actual and real, or if only e2 ected, are reasonably i!!inent as ercei'ed ob3ecti'ely and in good faith by the e! loyer$ 2. 4hat the e! loyer ser'ed "ritten notice both to the e! loyees and to the De art!ent of Labor and +! loy!ent at least one !onth rior to the intended date of retrench!ent$ =. 4hat the e! loyer ays the retrenched e! loyees se aration ay e,ui'alent to one .10 !onth ay or at least U !onth ay for e'ery year of ser'ice, "hiche'er is higher$ E. 4hat the e! loyer e2ercises its rerogati'e to retrench e! loyees in good faith for the ad'ance!ent of its interest and not to defeat or circu!'ent the e! loyees) right to security of tenure$ and B. 4hat the e! loyer used fair and reasonable criteria in ascertaining "ho "ould be dis!issed and "ho "ould be retained a!ong the e! loyees, such as status, efficiency, seniority, hysical fitness, age, and financial hardshi for certain "or%ers. All these ele!ents "ere successfully ro'en by etitioner. 9irst, the huge losses suffered by the Club for the ast t"o years had forced etitioner to close it do"n to a'ert further losses "hich "ould e'entually affect the o erations of etitioner. Second, all EB e! loyees "or%ing in the Club "ere ser'ed "ith notice of ter!ination. 4he corres onding notice "as li%e"ise ser'ed to the D*L+ one !onth rior to retrench!ent. 4hird, the e! loyees "ere offered se aration ay, !ost of "ho! ha'e acce ted and o ted not to 3oin in this co! laint. 9ourth, the cessation of or "ithdra"al fro! business o erations "as bona 5ide in character and not i! elled by a !oti'e to defeat or circu!'ent the tenurial rights of e! loyees. &aterfront Cebu City Hotel 's. -a. -elanie P. Ji!ene5, et al. 8./. :o. 1AE21E, June 1=, 2012.

+! loyee dis!issal$ due rocess. 4he follo"ing are the guiding rinci les in connection "ith the hearing re,uire!ent in dis!issal cases# 1. CA! le o ortunity to be heardD !eans any !eaningful o ortunity .'erbal or "ritten0 gi'en to the e! loyee to ans"er the charges against hi! and sub!it e'idence in su ort of his defense, "hether in a hearing, conference or so!e other fair, 3ust and reasonable "ay. 2. A for!al hearing or conference beco!es !andatory only "hen re,uested by the e! loyee in "riting or substantial e'identiary dis utes e2ist or a co! any rule or ractice re,uires it, or "hen si!ilar circu!stances 3ustify it. =. 4he Ca! le o ortunity to be heardD standard in the Labor Code re'ails o'er the Chearing or conferenceD re,uire!ent in the i! le!enting rules and regulations. 8i'en that the etitioners e2 ressly re,uested a conference or a con'ening of a grie'ance co!!ittee, such for!al hearing beca!e !andatory. After P8A( failed to affir!ati'ely res ond to such re,uest, it follo"s that the hearing re,uire!ent "as not co! lied "ith and, therefore, Fallota "as denied his right to rocedural due rocess. Prudential Guarantee and Assurance Employee 0abor Union and )andy ?. /allota vs. 0R,, Prudential Guarantee and Assurance Inc., and/or (ocelyn Reti@os. 8./. :o. 17B==B, June 1=, 2012. +! loyee dis!issal$ 3ust cause. Article 272.e0 of the Labor Code tal%s of other analogous causes or those "hich are susce tible of co! arison to another in general or in s ecific detail as a cause for ter!ination of e! loy!ent. A cause analogous to serious !isconduct is a 'oluntary and<or "illful act or o!ission attesting to an e! loyee)s !oral de ra'ity. 4heft co!!itted by an e! loyee against a erson other than his e! loyer, if ro'en by substantial e'idence, is a cause analogous to serious !isconduct. Pre'ious infractions !ay be cited as 3ustification for dis!issing an e! loyee only if they are related to the subse,uent offense. Ho"e'er, it !ust be noted that such a discussion "as unnecessary since the theft, ta%en in isolation fro! 9er!in)s other 'iolations, "as in itself a 'alid cause for the ter!ination of his e! loy!ent. ,osmos -ottling ,orp. vs. Ailson 2ermin/Ailson 2ermin vs. ,osmos -ottling ,orp. and ,ecilia -autista. 8./. :o. 16=>A> V 8./. :o. 16E=0=. June 20, 2012. +! loyee dis!issal$ loss of trust and confidence. 4he Labor Code recogni5es that an e! loyer, for 3ust cause, !ay 'alidly ter!inate the ser'ices of an e! loyee for serious !isconduct or "illful disobedience of the la"ful orders of the e! loyer or re resentati'e in connection "ith the e! loyee)s "or%. 9raud or "illful breach by the e! loyee of the trust re osed by the e! loyer in the for!er, or si! ly loss of confidence, also 3ustifies an e! loyee)s dis!issal fro! e! loy!ent. &illful breach of trust or loss of confidence re,uires that the e! loyee .10 occu ied a osition of trust or .20 "as routinely charged "ith the care of the e! loyer)s ro erty. 4o "arrant dis!issal based on loss of confidence, there !ust be so!e basis for the loss of trust or the e! loyer !ust ha'e reasonable grounds to belie'e that the e! loyee is res onsible for the !isconduct that renders the latter un"orthy of the trust and confidence de!anded by his or her osition. 9or !ore than a !onth, the etitioners did not e'en infor! PLD4 of the "hereabouts of the lant !aterials. (nstead, he stoc%ed these !aterials at his residence e'en if they "ere needed in the daily o erations of the co! any. (n %ee ing "ith the honesty and integrity de!anded by his osition, he should ha'e turned o'er these !aterials to the lant)s "arehouse. 4hus, PLD4 reasonably sus ected etitioner of stealing the co! any)s ro erty. At that 3uncture, the e! loyer !ay already dis!iss the e! loyee since it had reasonable grounds to belie'e or to entertain the !oral con'iction that the latter "as res onsible

for the !isconduct, and the nature of his artici ation therein rendered hi! absolutely un"orthy of the trust and confidence de!anded by his osition. Romeo E. Paulino vs. 0R,, P*ilippine 0ong 3istance ,o., Inc. 8./. :o. 1A>17E, June 1=, 2012. +! loyee dis!issal$ loss of trust and confidence. Loss of confidence as a 3ust cause for dis!issal "as ne'er intended to ro'ide e! loyers "ith a blan% chec% for ter!inating their e! loyees. (t should ideally a ly only to cases in'ol'ing e! loyees occu ying ositions of trust and confidence or to those situations "here the e! loyee is routinely charged "ith the care and custody of the e! loyer)s !oney or ro erty. 4o the first class belong !anagerial e! loyees, i.e., those 'ested "ith the o"ers or rerogati'es to lay do"n !anage!ent olicies and<or to hire, transfer, sus end, lay1off, recall, discharge, assign or disci line e! loyees or effecti'ely reco!!end such !anagerial actions$ and to the second class belong cashiers, auditors, ro erty custodians, etc., or those "ho, in the nor!al and routine e2ercise of their functions, regularly handle significant a!ounts of !oney or ro erty. 4he first re,uisite for dis!issal on the ground of loss of trust and confidence is that the e! loyee concerned !ust be one holding a osition of trust and confidence. 4he second re,uisite is that there !ust be an act that "ould 3ustify the loss of trust and confidence. Fallota)s osition as Junior Progra!!er is analogous to the second class of ositions of trust and confidence. 4hough he did not hysically handle !oney or ro erty, he beca!e ri'y to confidential data or infor!ation by the nature of his functions. At a ti!e "hen the !ost sensiti'e of infor!ation is found not rinted on a er but stored on hard dri'es and ser'ers, an e! loyee "ho handles or has access to data in electronic for! naturally beco!es the un"illing reci ient of confidential infor!ation. 4here "as no other e'idence resented to ro'e fraud in the !anner of securing or obtaining the files found in Fallota)s co! uter. 4he resence of the files "ould !erely !erit the de'elo !ent of so!e sus icion on the art of the e! loyer, but should not a!ount to a loss of trust and confidence such as to 3ustify the ter!ination of his e! loy!ent. Such act is not of the sa!e class, degree or gra'ity as the acts that ha'e been held to be of such character. Prudential Guarantee and Assurance Employee 0abor Union and )andy ?. /allota vs. 0R,, Prudential Guarantee and Assurance Inc., and/or (ocelyn Reti@os. 8./. :o. 17B==B, June 1=, 2012. +! loyee dis!issal$ loss of trust and confidence. 4o 'alidly dis!iss an e! loyee on the ground of loss of trust and confidence under Article 272 .c0 of the Labor Code of the Phili ines, the follo"ing guidelines !ust be obser'ed# 10 loss of confidence should not be si!ulated$ 20 it should not be used as subterfuge for causes "hich are i! ro er, illegal or un3ustified$ =0 it !ay not be arbitrarily asserted in the face of o'er"hel!ing e'idence to the contrary$ and E0 it !ust be genuine, not a !ere afterthought to 3ustify earlier action ta%en in bad faith. -ore i! ortantly, it !ust be based on a "illful breach of trust and founded on clearly established facts. 4he testi!ony of LobitaTa constitutes substantial e'idence to ro'e that res ondent, as the then Po"er Plant -anager, acce ted co!!issions and<or C%ic%bac%sD fro! su liers, "hich is a clear 'iolation of Section 2.0E of etitioner)s Co! any /ules and /egulations. Juris rudence consistently holds that for !anagerial e! loyees, the !ere e2istence of a basis for belie'ing that such e! loyee has breached the trust of his e! loyer "ould suffice for his dis!issal. /es ondent)s ter!ination "as for a 3ust and 'alid cause. Apo ,ement ,orporation /s. Galdy E. -aptisma. 8./. :o. 1A>>A1. June 20, 2012. +! loyee dis!issal$ order of reinstate!ent. Article 22= of the Labor Code ro'ides that in case there is an order of reinstate!ent, the e! loyer !ust ad!it the dis!issed e! loyee under the sa!e ter!s and conditions, or !erely reinstate the e! loyee in the ayroll. 4he order shall be i!!ediately e2ecutory. 4hus, =rd Alert cannot esca e liability by si! ly in'o%ing that :a'ia did

not re ort for "or%. 4he la" states that the e! loyer !ust still reinstate the e! loyee in the ayroll. &here reinstate!ent is no longer 'iable as an o tion, se aration ay e,ui'alent to one .10 !onth salary for e'ery year of ser'ice could be a"arded as an alternati'e. $rd Alert )ecurity and 3etective )ervices, Inc. vs. Romualdo avia. 8./. :o. 200>B=, June 1=, 2012. +! loyee dis!issal$ retrench!ent. /etrench!ent is the ter!ination of e! loy!ent initiated by the e! loyer through no fault of and "ithout re3udice to the e! loyees. (t is resorted to during eriods of business recession, industrial de ression, or seasonal fluctuations or during lulls occasioned by lac% of orders, shortage of !aterials, con'ersion of the lant for a ne" roduction rogra! or the introduction of ne" !ethods or !ore efficient !achinery or of auto!ation. (t is an act of the e! loyer of dis!issing e! loyees because of losses in the o eration of a business, lac% of "or%, and considerable reduction on the 'olu!e of his business. (n this case, the closure of a de art!ent or di'ision of a co! any constitutes retrench!ent by, and not closure of, the co! any itself. Petitioner has not totally ceased its business o erations. (t !erely ceased o erations of a de art!ent. &aterfront Cebu City Hotel 's. -a. -elanie P. Ji!ene5, et al. 8./. :o. 1AE21E, June 1=, 2012. +! loyee dis!issal$ "illful breach of trust. 4he loss of trust and confidence !ust be based on "illful breach of the trust re osed in the e! loyee by his e! loyer. Such breach is "illful if it is done intentionally, %no"ingly, and ur osely, "ithout 3ustifiable e2cuse, as distinguished fro! an act done carelessly, thoughtlessly, heedlessly or inad'ertently. -oreo'er, it !ust be based on substantial e'idence and not on the e! loyer)s "hi!s or ca rices or sus icions other"ise, the e! loyee "ould eternally re!ain at the !ercy of the e! loyer. 4he Su re!e Court has laid do"n the guidelines for the a lication of the loss of trust and confidence doctrine# .10 loss of confidence should not be si!ulated$ .20 it should not be used as a subterfuge for causes "hich are i! ro er, illegal or un3ustified$ .=0 it !ay not be arbitrarily asserted in the face of o'er"hel!ing e'idence to the contrary$ and .E0 it !ust be genuine, not a !ere afterthought, to 3ustify an earlier action ta%en in bad faith. Fillanue'a "or%ed for -eralco as a ;ranch /e resentati'e "hose tas%s included the issuance of Contracts for +lectric Ser'ice after recei t of the a!ount due for ser'ice connection fro! custo!ers. *b'iously, he "as entrusted not only "ith the res onsibility of handling co! any funds but also to cater to custo!ers "ho intended to a'ail of -eralco)s ser'ices. 4his is nothing but an indication that trust and confidence "ere re osed in hi! by the co! any, although his osition "as not strictly !anagerial by nature. -eralco)s loss of trust and confidence arising out of Fillanue'a)s act of !isa ro riation of co! any funds in the course of rocessing custo!er a lications has been ro'en by substantial e'idence, thus, 3ustified. Ferily, the issuance of additional recei ts for e2cessi'e ay!ents e2acted fro! custo!ers is a "illful breach of the trust re osed in hi! by the co! any. /icente /illanueva, (r. vs.. ?*e ational 0abor Relations ,ommission, ?*ird 3ivision, Manila Electric ,ompany, Manuel 0ope@, ,*airman and ,E<, and 2rancisco ,ollantes, Manager . 8./. :o. 1A>76=, June 1=, 2012. +! loyee suit$ da!ages. 4o obtain !oral da!ages, the clai!ant !ust ro'e the e2istence of bad faith by clear and con'incing e'idence, for the la" al"ays resu!es good faith. (t is not e'en enough that one !erely suffered slee less nights, !ental anguish and serious an2iety as the result of the actuations of the other arty. (n this case, La5aro did not state any !oral anguish that he suffered. :either did he substantiate his i! utations of !alice to ;anco 9ili ino. He only !ade a s"ee ing declaration, "ithout concrete roof, that the ban% in refusing his clai! !aliciously da!aged his ro erty rights and interest. Accordingly, neither !oral da!ages nor e2e! lary da!age can be a"arded to hi!.

&ith res ect to attorney)s fees, an a"ard is ro er only if that erson "as forced to litigate and incur e2 enses to rotect one)s rights and interest by reason of an un3ustified act or o!ission of the arty for "ho! it is sought. ;anco 9ili ino had a ri!a facie legiti!ate defense that, because it under"ent li,uidation roceedings, it cannot be co! elled to credit that eriod in the co! utation of the e! loyee)s the retire!ent ay and rofit shares. Considering that ;anco 9ili ino)s refusal cannot be accurately characteri5ed as un3ustified, La5aro cannot clai! an a"ard of attorney)s fees. -anco 2ilipino )avings and Mortgage -an9 vs. Miguelito M. 0a@aro/Miguelito M. 0a@aro vs. -anco 2ilipino )avings and Mortgage -an9, et al. 8./. :o. 17B=E> V 8./. :o. 17BEE2. June 2A, 2012. (nde endent contractor$ tests. Per!issible 3ob contracting or subcontracting refers to an arrange!ent "hereby a rinci al agrees to ut out or far! out to a contractor or subcontractor the erfor!ance or co! letion of a s ecific 3ob, "or% or ser'ice "ithin a definite or redeter!ined eriod, regardless of "hether such 3ob, "or% or ser'ice is to be erfor!ed or co! leted "ithin or outside the re!ises of the rinci al. A erson is considered engaged in legiti!ate 3ob contracting or subcontracting if the follo"ing conditions concur# .a0 4he contractor or subcontractor carries on a distinct and inde endent business and underta%es to erfor! the 3ob, "or% or ser'ice on its o"n account and under its o"n res onsibility according to its o"n !anner and !ethod, and free fro! the control and direction of the rinci al in all !atters connected "ith the erfor!ance of the "or% e2ce t as to the results thereof$ .b0 4he contractor or subcontractor has substantial ca ital or in'est!ent$ and .c0 4he agree!ent bet"een the rinci al and contractor or subcontractor assures the contractual e! loyees entitle!ent to all labor and occu ational safety and health standards, free e2ercise of the right to self1organi5ation, security of tenure, and social "elfare benefits. (n contrast, labor1only contracting, a rohibited act, is an arrange!ent "here the contractor or subcontractor !erely recruits, su lies or laces "or%ers to erfor! a 3ob, "or% or ser'ice for a rinci al. (n labor1only contracting, the follo"ing ele!ents are resent# .a0 4he contractor or subcontractor does not ha'e substantial ca ital or in'est!ent to actually erfor! the 3ob, "or% or ser'ice under its o"n account and res onsibility$ and .b0 4he e! loyees recruited, su lied or laced by such contractor or subcontractor, are erfor!ing acti'ities "hich are directly related to the !ain business of the rinci al. 4he test of inde endent contractorshi is "hether one clai!ing to be an inde endent contractor has contracted to do the "or% according to his o"n !ethods and "ithout being sub3ect to the control of the e! loyer, e2ce t only as to the results of the "or%. 8ra!a3e is not an inde endent 3ob contractor, but a Clabor1onlyD contractor. 9irst, 8ra!a3e has no substantial ca ital or in'est!ent. 4he resu! tion is that a contractor is a labor1only contractor unless he o'erco!es the burden of ro'ing that it has substantial ca ital, in'est!ent, tools, and the li%e. :either 8ra!a3e nor Polyfoa! resented e'idence sho"ing 8ra!a3e)s o"nershi of the e,ui !ent and !achineries used in the erfor!ance of the alleged contracted 3ob.

Second, 8ra!a3e did not carry on an inde endent business or underta%e the erfor!ance of its ser'ice contract according to its o"n !anner and !ethod, free fro! the control and su er'ision of its rinci al, Polyfoa!, its a arent role ha'ing been !erely to recruit ersons to "or% for Polyfoa!. (t is undis uted that res ondent had erfor!ed his tas% of ac%ing Polyfoa!)s foa! roducts in Polyfoa!)s re!ises. As to the recruit!ent of res ondent, etitioners "ere able to establish only that res ondent)s a lication "as referred to 8ra!a3e, but that is all. Prior to his ter!ination, res ondent had been erfor!ing the sa!e 3ob in Polyfoa!)s business for al!ost si2 .>0 years. He "as e'en furnished a co y of Polyfoa!)s :Mga Alituntunin at Darampatang Parusa,; "hich e!bodied Polyfoa!)s rules on attendance, the !anner of erfor!ing the e! loyee)s duties, ethical standards, cleanliness, health, safety, eace and order. 4hese rules carried "ith the! the corres onding enalties in case of 'iolation. &hile it is true that etitioners sub!itted the Affida'it of Polyfoa!)s su er'isor, clai!ing that the latter did not e2ercise su er'ision o'er res ondent because the latter "as not Polyfoa!)s but 8ra!a3e)s e! loyee, said Affida'it is insufficient to ro'e such clai!. Petitioners should ha'e resented the erson "ho they clai! to ha'e e2ercised su er'ision o'er res ondent and their alleged other e! loyees assigned to Polyfoa!. (t "as ne'er established that 8ra!a3e too% entire charge, control and su er'ision of the "or% and ser'ice agreed u on. Poly5oam.RG, International, ,orporation and Precilla A. GramaHe vs. Edgardo ,oncepcion. 8./. :o. 1A2=E6, June 1=, 2012. :L/C$ 3urisdiction o'er inter retation or i! le!entation of the C;A. /.A. 70E2 is a s ecial la" go'erning o'erseas 9ili ino "or%ers. Ho"e'er, there is no s ecific ro'ision thereunder "hich ro'ides for 3urisdiction o'er dis utes or unresol'ed grie'ances regarding the inter retation or i! le!entation of a C;A. Section 10 of /.A. 70E2 si! ly s ea%s, in general, of Cclai!s arising out of an e! loyer1e! loyee relationshi or by 'irtue of any la" or contract in'ol'ing 9ili ino "or%ers for o'erseas de loy!ent including clai!s for actual, !oral, e2e! lary and other for!s of da!ages.D *n the other hand, Articles 21A.c0 and 2>1 of the Labor Code are 'ery s ecific in stating that 'oluntary arbitrators ha'e 3urisdiction o'er cases arising fro! the inter retation or i! le!entation of collecti'e bargaining agree!ents. (n the resent case, the basic issue raised by -erridy Jane in her co! laint filed "ith the :L/C is# "hich ro'ision of the sub3ect C;A a lies insofar as death benefits due to the heirs of :elson are concerned. 4his issue clearly in'ol'es the inter retation or i! le!entation of the said C;A. 4hus, the s ecific or s ecial ro'isions of the Labor Code go'ern. C;A is the la" or contract bet"een the arties. Article 1=.1 of the C;A entered into by and bet"een res ondent 8C( and A-*SGP ro'ides that the Co! any and the Gnion agree that in case of dis ute or conflict in the inter retation or a lication of any of the ro'isions of this Agree!ent, or enforce!ent of Co! any olicies, the sa!e shall be settled through negotiation, conciliation or 'oluntary arbitration. 4he ro'isions of the C;A are in consonance "ith /ule F((, Section A of the resent *!nibus /ules and /egulations (! le!enting the -igrant &or%ers and *'erseas 9ili inos Act of 166B, as a!ended by /e ublic Act :o. 10022, "hich states that for *9&s "ith collecti'e bargaining agree!ents, the case shall be sub!itted for 'oluntary arbitration in accordance "ith Articles 2>1 and 2>2 of the Labor Code. &ith res ect to dis utes in'ol'ing clai!s of 9ili ino seafarers "herein the arties are co'ered by a collecti'e bargaining agree!ent, the dis ute or clai! should be sub!itted to the 3urisdiction of a 'oluntary arbitrator or anel of arbitrators. (t is only in the absence of a collecti'e bargaining agree!ent that arties !ay o t to sub!it the dis ute to either the :L/C or to 'oluntary arbitration. Estate o5 elson R. 3ulay, represented by *is wi5e Meddiry (ane P. 3ulay vs. Aboiti@ (ebsen Maritime, Inc. and General ,*arterers, Inc. 8./. :o. 1A2>E2, June 1=, 2012.

Ser'ice$ roof of ser'ice. Petitioners allege that no affida'it of ser'ice "as attached to the CA Petition. Ho"e'er, the Su re!e Court noted that in the CA /esolution, the a ellate court stated that their records re'ealed that Atty. +s inas, etitioners) counsel of record at the ti!e, "as duly ser'ed a co y of the follo"ing# CA /esolution granting res ondent)s -otion for +2tension of 4i!e to file the CA Petition$ CA /esolution re,uiring etitioners to file their Co!!ent on the CA Petition$ and CA /esolution, sub!itting the case for resolution, as no co!!ent "as filed. Such ser'ice to Atty. +s inas "as 'alid des ite the fact he "as already deceased at the ti!e. (f a arty to a case has a eared by counsel, ser'ice of leadings and 3udg!ents shall be !ade u on his counsel or one of the!, unless ser'ice u on the arty is s ecifically ordered by the court. (t is not the duty of the courts to in,uire, during the rogress of a case, "hether the la" fir! or artnershi re resenting one of the litigants continues to e2ist la"fully, "hether the artners are still ali'e, or "hether its associates are still connected "ith the fir!. )alvador <. MoHar, et al. vs. Agro ,ommercial )ecurity )ervice Agency, et al. 8./. :o. 17A177, June 2A, 2012.

July 2012 Philippine Supreme Court Decisions on Labor Law and Procedure
Posted on August 7, 2012 by Leslie C. Dy Here are select July 2012 rulings of the Su re!e Court of the Phili ines on labor la" and rocedure# Dis!issal$ due rocess. Due rocess re,uire!ent is !et "hen there is si! ly an o ortunity to be heard and to e2 lain one)s side e'en if no hearing is conducted. An e! loyee !ay be afforded a! le o ortunity to be heard by !eans of any !ethod, 'erbal or "ritten, "hether in a hearing, conference or so!e other fair, 3ust and reasonable "ay. After recei'ing the first notice a rising hi! of the charges against hi!, the e! loyee !ay sub!it a "ritten e2 lanation ."hich !ay be in the for! of a letter, !e!orandu!, affida'it or osition a er0 and offer e'idence in su ort thereof, li%e rele'ant co! any records and the s"orn state!ents of his "itnesses. 9or this ur ose, he !ay re are his e2 lanation ersonally or "ith the assistance of a re resentati'e or counsel. He !ay also as% the e! loyer to ro'ide hi! co y of records !aterial to his defense. His "ritten e2 lanation !ay also include a re,uest that a for!al hearing or conference be held. (n such a case, the conduct of a for!al hearing or conference beco!es !andatory, 3ust as it is "here there e2ist substantial e'identiary dis utes or "here co! any rules or ractice re,uires an actual hearing as art of e! loy!ent re1ter!ination rocedure. Petitioner)s "ritten res onse to the rere,uisite notice ro'ided her "ith an a'enue to e2 lain and defend her side and thus ser'ed the ur ose of due rocess. 4hat there "as no hearing, in'estigation or right to a eal, "hich etitioner o ined to be a 'iolation of co! any olicies, is of no !o!ent since the record is bereft of any sho"ing that there is an e2isting co! any olicy that re,uires these rocedures "ith res ect to the ter!ination of a CH/ Director li%e etitioner or that co! any ractice calls for the sa!e. 4here "as also no re,uest for a for!al hearing on the art of etitioner. As she "as ser'ed "ith a notice a rising her of the charges against her and also a subse,uent notice infor!ing her of the !anage!ent)s decision to ter!inate her ser'ices after res ondents found her "ritten res onse to the first notice unsatisfactory, etitioner "as

clearly afforded her right to due rocess. 2lordeli@a Maria Reyes.Rayel vs. P*ilippine 0uen ?*ai >oldings ,orporation, et al. 8./. :o. 1AE76=, July 11, 2012. Dis!issal$ loss of trust and confidence. An e! loyer has a distinct rerogati'e and "ider latitude of discretion in dis!issing a !anagerial ersonnel "ho erfor!s functions "hich by their nature re,uire the e! loyer)s full trust and confidence.As distinguished fro! a ran% and file ersonnel, !ere e2istence of a basis for belie'ing that a !anagerial e! loyee has breached the trust of the e! loyer 3ustifies dis!issal. Loss of confidence as a ground for dis!issal does not re,uire roof beyond reasonable doubt as the la" re,uires only that there be at least so!e basis to 3ustify it. Petitioner "as LV4)s CH/ Director for -anufacturing, "hich is a !anagerial osition saddled "ith great res onsibility. As such, she "as directly res onsible for !anaging her o"n de art!ental staff. ;ecause of this, etitioner !ust en3oy the full trust and confidence of her su eriors. Ho"e'er, etitioner deli'ered dis!al erfor!ance and dis layed oor "or% attitude, "hich constitute sufficient reasons for an e! loyer to ter!inate an e! loyee on the ground of loss of trust and confidence. 9irst, records sho" that etitioner indeed unreasonably failed to effecti'ely co!!unicate "ith her i!!ediate su erior. Second, the affida'its of etitioner)s co1 "or%ers re'ealed her negati'e attitude and un rofessional beha'ior to"ards the! and the co! any. Lastly, etitioner dis layed inefficiency and ine titude in her 3ob as a CH/ Director. 4a%ing all these circu!stances collecti'ely, the Court is con'inced that res ondents ha'e sufficient and 'alid reasons for ter!inating the ser'ices of etitioner as her continued e! loy!ent "ould be atently ini!ical to res ondents) interest. 2lordeli@a Maria Reyes.Rayel vs. P*ilippine 0uen ?*ai >oldings ,orporation, et al. 8./. :o. 1AE76=, July 11, 2012. +! loyee dis!issal$ 'alidity of ter!ination. /etrench!ent is one of the authori5ed causes for the dis!issal of e! loyees recogni5ed by the Labor Code. (t is a !anage!ent rerogati'e resorted to by e! loyers to a'oid or to !ini!i5e business losses. 4he Court has laid do"n the follo"ing standards that an e! loyer should !eet to 3ustify retrench!ent and to foil abuse, na!ely# .a0 4he e2 ected losses should be substantial and not !erely de minimis in e2tent$

.b0 4he substantial losses a rehended !ust be reasonably i!!inent$ .c0 4he retrench!ent !ust be reasonably necessary and li%ely to effecti'ely e2 ected losses$ and re'ent the

.d0 4he alleged losses, if already incurred, and the e2 ected i!!inent losses sought to be forestalled !ust be ro'ed by sufficient and con'incing e'idence (n ter!ination cases, the burden of ro'ing that the dis!issal "as for a 'alid or authori5ed cause rests u on the e! loyer. 4he etitioner did not sub!it e'idence of the losses to its business o erations and the econo!ic ha'oc it "ould thereby i!!inently sustain. (t only clai!ed that res ondent)s ter!ination "as due to its C resent business<financial conditionD. 4his bare state!ent fell short of the nor! to sho" a 'alid retrench!ent. (ndeed, not e'ery loss incurred or e2 ected to be incurred by an e! loyer can 3ustify retrench!ent. 4he e! loyer !ust ro'e, a!ong others, that the losses are substantial and that the retrench!ent is reasonably necessary to a'ert such losses. 4hus, by its failure to resent sufficient and con'incing e'idence to ro'e that retrench!ent "as necessary, res ondent)s ter!ination due to retrench!ent is not allo"ed.

0egend >otel IManilaJ, owned by ?itatium ,orporation, et al. vs. >ernani ). Realuyo, also 9nown as (oey Roa. 8./. :o. 1B=B11, July 17, 2012. +! loyee training$ rei!burse!ent. 4he Su re!e Court recogni5ed the right of PAL to recou the costs of a ilot)s training in the for! of ser'ice for a eriod of at least three .=0 years. ;y carrying o'er the sa!e sti ulation setting the age of fifty1se'en .BA0 years as the rec%oning oint "hen a ilot beco!es dis,ualified to bid for a higher osition in the resent C;A, both PAL and ALPAP recogni5ed that the co! any)s effort in sending ilots for training abroad is an in'est!ent "hich necessarily e2 ects a reasonable return in the for! of ser'ice for a eriod of at least three .=0 years. 4his sti ulation had been re eatedly ado ted by the arties in the succeeding rene"als of their C;A, thus 'alidating the i! ression that it is a reasonable and acce table ter! to both PAL and ALPAP. Conse,uently, the etitioner cannot con'eniently disregard this sti ulation by si! ly raising the absence of a contract e2 ressly re,uiring the ilot to re!ain "ithin PAL)s e! loy "ithin a eriod of = years after he has been sent on training. 4he su osed absence of contract being raised by the etitioner cannot stand as the C;A clearly co'ered the etitioner)s obligation to render ser'ice to PAL "ithin = years to enable it to recou the costs of its in'est!ent. -ibiano ,. Elegir vs. P*ilippine Airlines, Inc. 8./. :o. 17166B, July 1>, 2012. +! loyer1e! loyee relationshi $ e2istence. 4he issue of "hether or not an e! loyer1e! loyee relationshi e2isted is essentially a ,uestion of fact. 4he factors that deter!ine the issue include "ho has the o"er to select the e! loyee, "ho ays the e! loyee)s "ages, "ho has the o"er to dis!iss the e! loyee, and "ho e2ercises control of the !ethods and results by "hich the "or% of the e! loyee is acco! lished. Although no articular for! of e'idence is re,uired to ro'e the e2istence of the relationshi , and any co! etent and rele'ant e'idence to ro'e the relationshi !ay be ad!itted, a finding that the relationshi e2ists !ust nonetheless rest on substantial e'idence, "hich is that a!ount of rele'ant e'idence that a reasonable !ind !ight acce t as ade,uate to 3ustify a conclusion. A re'ie" of the circu!stances re'eals that res ondent "as, indeed, etitioner)s e! loyee. He "as undeniably e! loyed as a ianist in etitioner)s /estaurant. 9irst of all, etitioner actually "ielded the o"er of selection at the ti!e it entered into the ser'ice contract "ith res ondent. 4he o"er of selection "as fir!ly e'idenced by, a!ong others, the e2 ress "ritten reco!!endation by etitioner)s restaurant !anager, for the increase of his re!uneration. Secondly, there is no denying that the re!uneration deno!inated as talent fees "as fi2ed on the basis of his talent and s%ill and the ,uality of the !usic he layed during the hours of erfor!ance each night, ta%ing into account the re'ailing rate for si!ilar talents in the entertain!ent industry. /es ondent)s re!uneration, albeit deno!inated as talent fees, "as still considered as included in the ter! "agein the sense and conte2t of the Labor Code, regardless of ho" etitioner chose to designate the re!uneration. 4hirdly, the etitioner has the o"er to dis!iss res ondent. 4he !e!orandu! infor!ing res ondent of the discontinuance of his ser'ice because of the resent business or financial condition of etitioner sho"ed that the latter had the o"er to dis!iss hi! fro! e! loy!ent. Lastly, the o"er of the e! loyer to control the "or% of the e! loyee is considered the !ost significant deter!inant of the e2istence of an e! loyer1 e! loyee relationshi . 4his is the so1called control test, and is re!ised on "hether the erson for "ho! the ser'ices are erfor!ed reser'es the right to control both the end achie'ed and the !anner and !eans used to achie'e that end. /es ondent erfor!ed his "or% as a ianist under etitioner)s su er'ision and control. Petitioner)s control of both the end achie'ed and the !anner and !eans used to achie'e that end "as de!onstrated by the follo"ing, to "it# .10He could not choose the ti!e of his erfor!ance, "hich etitioners had fi2ed fro! A#00 ! to 10#00 !, three

to si2 ti!es a "ee%$ .20He could not choose the lace of his erfor!ance$ .=0 4he restaurant)s !anager re,uired hi! at certain ti!es to erfor! only 4agalog songs or !usic, or to "ear barong 4agalog to confor! to the 9ili iniana !otif$ and .E0He "as sub3ected to the rules on e! loyees) re resentation chec% and chits, a ri'ilege granted to other e! loyees. 0egend >otel IManilaJ, owned by ?itatium ,orporation, et al. vs. >ernani ). Realuyo, also 9nown as (oey Roa. 8./. :o. 1B=B11, July 17, 2012. -anage!ent rerogati'e$ transfer of e! loyees. An e! loyer)s decision to transfer an e! loyee, if !ade in good faith, is a 'alid e2ercise of a !anage!ent rerogati'e, although it !ay result in ersonal incon'enience or hardshi to the e! loyee. /e1assign!ents !ade by !anage!ent ending in'estigation of irregularities allegedly co!!itted by an e! loyee fall "ithin the a!bit of !anage!ent rerogati'e. 4he ur ose of reassign!ents is no different fro! that of re'enti'e sus ension "hich !anage!ent could 'alidly i! ose as a disci linary !easure for the rotection of the co! any)s ro erty ending in'estigation of any alleged !alfeasance or !isfeasance co!!itted by the e! loyee. As the e2ecuti'e assistant of the resident, etitioner undeniably occu ied a sensiti'e osition that re,uired her e! loyer)s ut!ost trust and confidence. Ha'ing lost his trust and confidence in etitioner, res ondent Delfin had the right to transfer her to ensure that she "ould no longer ha'e access to the co! anies) confidential files. Although it is true that etitioner has yet to be ro'en guilty, res ondents had the authority to reassign her, ending in'estigation. &hen etitioner "as assigned to Ca'ite, there "as an ongoing in'estigation of the charges filed against her. (t is undis uted that she refused to fill u , for no 3ustifiable reasons, the ,uestionnaire distributed by her e! loyer to deter!ine "ho a!ong those "ho had access to the confidential files "as res onsible for their ta%ing. 9urther!ore, a "itness had e2ecuted an Affida'it clai!ing that she found the !issing files, and that her husband told her that it "as etitioner "ho handed those files to hi!. Lastly, the erson "ho su osedly recei'ed these docu!ents fro! etitioner did not deny or rebu%e the state!ents !ade by his "ife. (osep*ine Rui@ vs. Aendel <sa9a Realty ,orp., et al. 8./. :o. 176072, July 11, 2012. /etire!ent Pay$ collecti'e bargaining agree!ent. Article 27A of the Labor Code ro'ides that it is a licable only to a situation "here .10 there is no C;A or other a licable e! loy!ent contract ro'iding for retire!ent benefits for an e! loyee, or .20 there is a C;A or other a licable e! loy!ent contract ro'iding for retire!ent benefits for an e! loyee, but it is belo" the re,uire!ent set by la". 4he rationale for the first situation is to re'ent the absurd situation "here an e! loyee, deser'ing to recei'e retire!ent benefits, is denied to the! through the nefarious sche!e of e! loyers to de ri'e e! loyees of the benefits due the! under e2isting labor la"s. *n the other hand, the second situation ai!s to re'ent ri'ate contracts fro! derogating fro! the ublic la". 4he deter!ining factor in choosing "hich retire!ent sche!e to a ly is still su eriorityin ter!s of benefits ro'ided. 4hus, e'en if there is an e2isting C;A but the sa!e does not ro'ide for retire!ent benefits e,ual or su erior to that "hich is ro'ided under Article 27A of the Labor Code, the latter "ill a ly. 4here are t"o retire!ent sche!es at oint in this case# .10 Article 27A of the Labor Code, and$ .20 the PAL1ALPAP /etire!ent Plan and the PAL Pilots) /etire!ent ;enefit Plan. 4he t"o retire!ent sche!es are alternati'e in nature such that the retired ilot can only be entitled to that "hich ro'ides for su erior benefits. Co! aring the benefits under the t"o .20 retire!ent sche!es, it can readily be ercei'ed that the 22.B days "orth of salary for e'ery year of ser'ice ro'ided under Article 27A of the Labor Code cannot !atch the 2E0H of salary or al!ost t"o and a half "orth of !onthly salary er year of ser'ice ro'ided under the PAL Pilots) /etire!ent

;enefit Plan, "hich "ill be further added to the 12B,000.00 to "hich the etitioner is entitled under the PAL1ALPAP /etire!ent Plan. Clearly then, it is to the etitioner)s ad'antage that PAL)s retire!ent lans "ere a lied in the co! utation of his retire!ent benefits. -ibiano ,. Elegir vs. P*ilippine Airlines, Inc. 8./. :o. 17166B, July 1>, 2012. Gn3ust enrich!ent. 4here is un3ust enrich!ent "hen a erson un3ustly retains a benefit at the loss of another, or "hen a erson retains the !oney or ro erty of another against the funda!ental rinci les of 3ustice, e,uity and good conscience. 4"o conditions !ust concur# .10 a erson is un3ustly benefited$ and .20 such benefit is deri'ed at the e2 ense of or "ith da!ages to another. 4he enrich!ent !ay consist of a atri!onial, hysical, or !oral ad'antage, so long as it is a reciable in !oney. (t !ust ha'e a correlati'e re3udice, disad'antage or in3ury to the laintiff "hich !ay consist, not only of the loss of the ro erty or the de ri'ation of its en3oy!ent, but also of the non1 ay!ent of co! ensation for a restation or ser'ice rendered to the defendant "ithout intent to donate on the art of the laintiff, or the failure to ac,uire so!ething that the latter "ould ha'e obtained. PAL in'ested a considerable a!ount of !oney in sending the etitioner abroad to undergo training to re are hi! for his ne" a oint!ent as ;AEA1E00 Ca tain. (n the rocess, the etitioner ac,uired ne" %no"ledge and s%ills "hich effecti'ely enriched his technical %no"1 ho". As all other in'estors, PAL e2 ects a return on in'est!ent in the for! of ser'ice by the etitioner for a eriod of = years, "hich is the esti!ated length of ti!e "ithin "hich the costs of the latter)s training can be fully reco'ered. 4he etitioner is, thus, e2 ected to "or% for PAL and utili5e "hate'er %no"ledge he had learned fro! the training for the benefit of the co! any. Ho"e'er, after only one .10 year of ser'ice, the etitioner o ted to retire fro! ser'ice, lea'ing PAL stri ed of a necessary !an o"er. Gndeniably, the etitioner "as enriched at the e2 ense of PAL. After undergoing the training fully shouldered by PAL, he ac,uired a higher le'el of technical co! etence "hich, in the rofessional real!, translates to a higher co! ensation. 9urther, his training broadened his o ortunities for a better e! loy!ent as in fact he "as able to transfer to another airline co! any i!!ediately after he left PAL. 4o allo" the etitioner to si! ly lea'e the co! any "ithout rei!bursing it for the ro ortionate a!ount of the e2 enses it incurred for his training "ill only !agnify the financial disad'antage sustained by PAL. /eason and fairness dictate that he !ust return to the co! any a ro ortionate a!ount of the costs of his training. -ibiano ,. Elegir vs. P*ilippine Airlines, Inc. 8./. :o. 17166B, July 1>, 2012.

August 2012 Philippine Supreme Court Decisions on Labor Law and Procedure
Posted on Se te!ber 10, 2012 by Leslie C. Dy Here are select rulings of the Phili ine Su re!e Court on labor la" and rocedure# Disability benefits$ entitle!ent. +ntitle!ent of seafarers to disability benefits is go'erned not only by !edical findings but also by contract and by la". ;y contract, De art!ent *rder :o. E, series of 2000, of the De art!ent of Labor and +! loy!ent and the arties) Collecti'e ;argaining Agree!ent bind the seafarer and the e! loyer. ;y la", the Labor Code ro'isions on

disability a ly "ith e,ual force to seafarers. 4he seafarer, u on sign1off fro! his 'essel, !ust re ort to the co! any1designated hysician "ithin three .=0 days fro! arri'al for diagnosis and treat!ent. 9or the duration of the treat!ent but in no case to e2ceed 120 days, the sea!an is on te! orary total disability as he is totally unable to "or%. He recei'es his basic "age during this eriod until he is declared fit to "or% or his te! orary disability is ac%no"ledged by the co! any to be er!anent, either artially or totally, as his condition is defined under the P*+A Standard +! loy!ent Contract and by a licable Phili ine la"s. (f the 120 days initial eriod is e2ceeded and no such declaration is !ade because the seafarer re,uires further !edical attention, then the te! orary total disability eriod !ay be e2tended u to a !a2i!u! of 2E0 days, sub3ect to the right of the e! loyer to declare "ithin this eriod that a er!anent artial or total disability already e2ists. 4he sea!an !ay of course also be declared fit to "or% at any ti!e such declaration is 3ustified by his !edical condition. 9ro! the ti!e 4o!acru5 "as re atriated on :o'e!ber 17, 2002, he sub!itted hi!self to the care and treat!ent of the co! any1designated hysician. &hen the co! any1designated hysician !ade a declaration on July 2B, 200= that 4o!acru5 "as already fit to "or%, 2E6 days had already la sed fro! the ti!e he "as re atriated. As such, his te! orary total disability should be dee!ed total and er!anent, ursuant to Article 162 .c0.10 of the Labor Code and its i! le!enting rule. P*ilasia )*ipping Agency ,orporation, et al. vs. Andres G. ?omacru@. 8./. :o. 171170, August 1B, 2012. +! loyee dis!issal$ due rocess re,uire!ents. 4he follo"ing standards of due rocess shall be substantially obser'ed for ter!ination of e! loy!ent based on 3ust causes as defined in Article 272 of the Labor Code# .i0 A "ritten notice ser'ed on the e! loyee s ecifying the ground or grounds for ter!ination, and gi'ing said e! loyee reasonable o ortunity "ithin "hich to e2 lain his side. .ii0 A hearing or conference during "hich the e! loyee concerned, "ith the assistance of counsel if he so desires is gi'en o ortunity to res ond to the charge, resent his e'idence or rebut the e'idence resented against hi!. .iii0 A "ritten notice of ter!ination ser'ed on the e! loyee, indicating that u on due consideration of all the circu!stances, grounds ha'e been established to 3ustify his ter!ination. Petitioners) e'idence fails to ro'e their contention that they afforded Atencio "ith due rocess. 4he June 21, 1666 letter, "hich allegedly ro'es Atencio)s %no"ledge of the charges against hi!, and "hich allegedly constitutes Atencio)s e2 lanation, clearly discusses an entirely different to ic ? "hich is the re!o'al of his construction co! any fro! the Calte2 ro3ect. As for the -ay 2E, 1666 letter, "hich allegedly constitutes the notice of ter!ination of Atencio)s e! loy!ent as JA/L)s chief o erating !anager, the said letter in'ol'es the ter!ination of the subcontracting agree!ent bet"een JA/L and Atencio)s co! any, and not the ter!ination of Atencio)s e! loy!ent. 9or etitioners) failure to obser'e the t"o1notice rule under Article 2AA.b0 of the Labor Code, res ondent is entitled to no!inal da!ages. (arl ,onstruction and Armando D. ?eHada vs. )imeon A. Atencio. 8./. :o. 1AB6>6, August 1, 2012. Judg!ent$ la" of the case.4he la" of the case has been defined as the o inion deli'ered on a for!er a eal. (t !eans that "hate'er is once irre'ocably established as the controlling legal rule or decision bet"een the sa!e arties in the sa!e case continues to be the la" of the case,

"hether correct on general rinci les or not, so long as the facts on "hich such decision "as redicated continue to be the facts of the case before the court. ;oth 8./. :o. 1>7EAA and this etition are offshoots of etitioner)s ur orted te! orary !easures to reser'e its neutrality "ith regard to the ercei'ed 'oid in the union leadershi . &hile these t"o cases arose out of different notices to stri%e, it is undeniable that the facts cited and the argu!ents raised by etitioner are al!ost identical. (ne'itably, 8./. :o. 1>7EAA and this etition see% only one relief, that is, to absol'e etitioner fro! res ondent)s charge of co!!itting an unfair labor ractice. 9or this reason, "e are constrained to a ly the la" of the case doctrine in light of the finality of our July 20, 200B and Se te!ber 21, 200B resolutions in 8./. :o. 1>7EAA. (n other "ords, our re'ious affir!ance of the Court of A eals) finding ? that etitioner erred in sus ending collecti'e bargaining negotiations "ith the union and in lacing the union funds in escro" considering the intra1union dis ute bet"een the Alia5as and ;aTe5 factions "as not a 3ustification therefor S is binding in the resent case. 3e la )alle University vs. 3e la )alle University Employees Association. 8./. :o. 1>62BE. August 2=, 2012. Lien$ un aid "ages. Gnder /e ublic Act :o. 101E2, other"ise %no"n as the 9inancial /ehabilitation and (nsol'ency Act of 2010, the right of a secured creditor to enforce his lien during li,uidation roceedings is retained. *n the right of first reference as regards un aid "ages, a distinction should be !ade bet"een a reference of credit and a lien. A reference a lies only to clai!s "hich do not attach to s ecific ro erties. A lien creates a charge on a articular ro erty. 4he right of first reference as regards un aid "ages recogni5ed by Article 110 of the Labor Code does not constitute a lien on the ro erty of the insol'ent debtor in fa'or of "or%ers. (t is but a reference of credit in their fa'or, a reference in a lication. (t is a !ethod ado ted to deter!ine and s ecify the order in "hich credits should be aid in the final distribution of the roceeds of the insol'ent)s assets. (t is a right to a first reference in the discharge of the funds of the 3udg!ent debtor. Conse,uently, the right of first reference for un aid "ages !ay not be in'o%ed in this case to nullify the foreclosure sales conducted ursuant to P:;)s right as a secured creditor to enforce its lien on s ecific ro erties of its debtor, A/CA-. Manuel 3. Engson, (r., 1in *is capacity as t*e 0i=uidator o5 AR,AM F ,o., Inc.4 vs. P*ilippine ational -an9. 8./. :o. 1A11=2, August 1B, 2012. :L/C$ 3urisdiction. Although /e ublic Act :o. 70E2, through its Section 10, transferred the original and e2clusi'e 3urisdiction to hear and decide !oney clai!s in'ol'ing o'erseas 9ili ino "or%ers fro! the P*+A to the Labor Arbiters, the la" did not re!o'e fro! the P*+A the original and e2clusi'e 3urisdiction to hear and decide all disci linary action cases and other s ecial cases ad!inistrati'e in character in'ol'ing such "or%ers. 4he ob'ious intent of /e ublic Act :o. 70E2 "as to ha'e the P*+A focus its efforts in resol'ing all ad!inistrati'e !atters affecting and in'ol'ing such "or%ers. 4he :L/C had no a ellate 3urisdiction to re'ie" the decision of the P*+A in disci linary cases in'ol'ing o'erseas contract "or%ers. Although, as a rule, all la"s are ros ecti'e in a lication unless the contrary is e2 ressly ro'ided, or unless the la" is rocedural or curati'e in nature, there is no serious ,uestion about the retroacti'e a licability of /e ublic Act :o. 70E2 to the a eal of the P*+A)s decision on etitioners) disci linary action against res ondents. (n a "ay, /e ublic Act :o. 70E2 "as a rocedural la" due to its ro'iding or o!itting guidelines on a eal. /e ublic Act :o. 70E2 a lies to etitioners) co! laint by 'irtue of the case being then still ending or undeter!ined at the ti!e of the la")s assage, there being no 'ested rights in rules of rocedure. 4hey could not 'alidly insist that the rec%oning eriod to ascertain "hich la" or rule should a ly "as the ti!e "hen the disci linary co! laint "as originally filed in the P*+A in 166=. -oreo'er, /e ublic

Act :o. 70E2 and its i! le!enting rules and regulations "ere already in effect "hen etitioners too% their a eal. &hen /e ublic Act :o. 70E2 "ithheld the a ellate 3urisdiction of the :L/C in res ect of cases decided by the P*+A, the a ellate 3urisdiction "as 'ested in the Secretary of Labor in accordance "ith his o"er of su er'ision and control under Section =7.10, Cha ter A, 4itle ((, ;oo% ((( of the /e'ised Ad!inistrati'e Code of 167A. Eastern Mediterranean Maritime 0td., et al. vs. Estanislao )urio, et al. 8./. :o. 1BE21=, August 2=, 2012. Petition for re'ie"$ ,uestion of fact. &hile generally, only ,uestions of la" can be raised in a etition for re'ie" on certiorari under /ule EB of the /ules of Court, the rule ad!its of certain e2ce tions, na!ely# .10 "hen the findings are grounded entirely on s eculations, sur!ises, or con3ectures$ .20 "hen the inference !ade is !anifestly !ista%en, absurd, or i! ossible$ .=0 "hen there is a gra'e abuse of discretion$ .E0 "hen the 3udg!ent is based on !isa reciation of facts$ .B0 "hen the findings of fact are conflicting$ .>0 "hen in !a%ing its findings, the sa!e are contrary to the ad!issions of both a ellant and a ellee$ .A0 "hen the findings are contrary to those of the trial court$ .70 "hen the findings are conclusions "ithout citation of s ecific e'idence on "hich they are based$ .60 "hen the facts set forth in the etition as "ell as in the etitioner)s !ain and re ly briefs are not dis uted by the res ondent$ and .100 "hen the findings of fact are re!ised on the su osed absence of e'idence and contradicted by the e'idence on record. 4he illegality of etitioner)s dis!issal "as an issue that "as s,uarely raised before the :L/C. &hen the :L/C decision "as re'ersed by the Court of A eals, there "as a situation "here Cthe findings of facts are conflictingD. 4he etition for re'ie" filed by the Petitioner co!es "ithin the ur'ie" of e2ce tion .B0 and by analogy, e2ce tion .A0. Mylene ,arvaHal vs. 0u@on 3evelopment -an9 and/or <scar G. Ramire@. 8./. :o. 17>1>6, August 1, 2012. Probationary e! loyee$ security of tenure. A robationary e! loyee, li%e a regular e! loyee, en3oys security of tenure. Ho"e'er, in cases of robationary e! loy!ent, aside fro! 3ust or authori5ed causes of ter!ination, an additional ground is ro'ided under Article 271 of the Labor Code, i.e., the robationary e! loyee !ay also be ter!inated for failure to ,ualify as a regular e! loyee in accordance "ith reasonable standards !ade %no"n by the e! loyer to the e! loyee at the ti!e of the engage!ent. Punctuality is a reasonable standard i! osed on e'ery e! loyee, "hether in go'ern!ent or ri'ate sector. As a !atter of fact, habitual tardiness is a serious offense that !ay 'ery "ell constitute gross or habitual neglect of duty, a 3ust cause to dis!iss a regular e! loyee. Assu!ing that etitioner "as not a rised of the standards conco!itant to her 3ob, it is but co!!on sense that she !ust abide by the "or% hours i! osed by the ban%. Satisfactory erfor!ance is and should be one of the basic standards for regulari5ation. :aturally, before an e! loyer hires an e! loyee, the for!er can re,uire the e! loyee, u on his engage!ent, to undergo a trial eriod during "hich the e! loyer deter!ines his fitness to ,ualify for regular e! loy!ent based on reasonable standards !ade %no"n to hi! at the ti!e of engage!ent. (t is e'ident that the ri!ary cause of res ondent)s dis!issal fro! her robationary e! loy!ent "as her Cchronic tardiness.D At the 'ery start of her e! loy!ent, etitioner already e2hibited oor "or%ing habits. +'en during her first !onth on the 3ob, she already incurred eight .70 tardiness. /es ondent also cited other infractions such as unauthori5ed lea'es of absence, !ista%e in clearing of a chec%, and under erfor!ance. All of these infractions "ere not refuted by etitioner. Mylene ,arvaHal vs. 0u@on 3evelopment -an9 and/or <scar G. Ramire@. 8./. :o. 17>1>6, August 1, 2012.

Salaries$ burden of roof of ay!ent. &hen there is an allegation of non ay!ent of salaries and other !onetary benefits, it is the e! loyer)s burden to ro'e its ay!ent to its e! loyee. 4he e! loyer)s e'idence !ust sho", "ith a reasonable degree of certainty, that it aid and that the "or%ers actually recei'ed the ay!ent. 4he reason for the rule is that the ertinent ersonnel files, ayrolls, records, re!ittances and other si!ilar docu!ents are not in the ossession of the "or%er but are in the custody and absolute control of the e! loyer. (n the case at bar, the t"o official recei ts issued by Safe!ar%, and offered as JA/L)s e'idence, only ro'e that JA/L !ade a total artial ay!ent of P1,761,B06.B0 to the said co! any for its C rofessional ser'ices.D Since JA/L ad!its that the said co! any actually rendered ser'ices for JA/L on its Calte2 ro3ect, the ay!ent can only be assu!ed as co'ering for the said ser'ices. 4here is nothing on the face of the recei ts to su ort the conclusion that Atencio .and not his co! any0 recei'ed it as ay!ent for his ser'ice as a JA/L e! loyee. (arl ,onstruction and Armando D. ?eHada vs. )imeon A. Atencio. 8./. :o. 1AB6>6, August 1, 2012. Seafarers$ contract. 4he e! loy!ent of seafarers, and its incidents, including clai!s for death benefits, is go'erned by the contracts they sign e'ery ti!e they are hired or rehired. Such contracts ha'e the force of la" bet"een the arties as long as their sti ulations are not contrary to la", !orals, ublic order or ublic olicy. &hile the seafarers and their e! loyers are go'erned by their !utual agree!ents, the P*+A rules and regulations re,uire that the P*+A Standard +! loy!ent Contract, "hich contains the standard ter!s and conditions of the seafarers) e! loy!ent in foreign ocean1going 'essels, be integrated in e'ery seafarer)s contract. 4he ertinent ro'ision of the 166> P*+A S+C, "hich "as in effect at the ti!e of 4ana"an)s e! loy!ent, "as Section 20.;0 ? Co! ensation and ;enefits. Aallem Maritime )ervices, Inc. vs. Ernesto ,. ?anawan. 8./. :o. 1>0EEE. August 26, 2012. Seafarers$ disability benefits. 4he one tas%ed to deter!ine "hether the seafarer suffers fro! any disability or is fit to "or% is the co! any1designated hysician. As such, the seafarer !ust sub!it hi!self to the co! any1designated hysician for a ost1e! loy!ent !edical e2a!ination "ithin three days fro! his re atriation. ;ut the assess!ent of the co! any1 designated hysician is not final, binding or conclusi'e on the seafarer, the labor tribunals, or the courts. 4he seafarer !ay re,uest a second o inion and consult a hysician of his choice regarding his ail!ent or in3ury, and the !edical re ort issued by the hysician of his choice shall also be e'aluated on its inherent !erit by the labor tribunal and the court. 4ana"an sub!itted hi!self to Dr. Li!, the co! any1designated hysician, for a !edical e2a!ination "ithin the =1day regle!entary eriod fro! his re atriation. 4he !edical e2a!ination conducted focused on 4ana"an)s foot in3ury, the cause of his re atriation. Dr. Li! treated 4ana"an for the foot in3ury fro! Dece!ber 1, 166A until -ay 21, 1667, "hen Dr. Li! declared hi! fit to "or%. &ithin that eriod that lasted 1A2 days, 4ana"an "as unable to erfor! his 3ob, an indication of a er!anent disability. Gnder the la", there is er!anent disability if a "or%er is unable to erfor! his 3ob for !ore than 120 days, regardless of "hether or not he loses the use of any art of his body. Disability should be understood !ore on the loss of earning ca acity rather than on the !edical significance of the disability. +'en in the absence of an official finding by the co! any1designated hysician to the effect that the seafarer suffers a disability and is unfit for sea duty, the seafarer !ay still be declared to be suffering fro! a er!anent disability if he is unable to "or% for !ore than 120 days. *n the other hand, 4ana"an)s clai! for disability benefits due to the eye in3ury "as already barred by his failure to re ort the in3ury and to ha'e his eye e2a!ined by a co! any1designated hysician. 4he rationale for the rule is that re orting the illness or in3ury "ithin three days fro! re atriation fairly !a%es it easier for a hysician to deter!ine the cause of the illness or in3ury.

Gnder the 166> P*+A S+C, it "as enough to sho" that the in3ury or illness "as sustained during the ter! of the contract. 4he Court has declared that the un,ualified hrase Cduring the ter!D found in Section 20.;0 thereof co'ered all in3uries or illnesses occurring during the lifeti!e of the contract. &hoe'er clai!s entitle!ent to the benefits ro'ided by la" should establish his right to the benefits by substantial e'idence. 4ana"an did not resent any roof of ha'ing sustained the eye in3ury during the ter! of his contract. All that he sub!itted "as his bare allegation that his eye had been s lashed "ith so!e thinner "hile he "as on board the 'essel. Aallem Maritime )ervices, Inc. vs. Ernesto ,. ?anawan. 8./. :o. 1>0EEE. August 26, 2012.

September 2012 Philippine Supreme Court Decisions on Labor Law and Procedure
Posted on *ctober 7, 2012 by Leslie C. Dy Here are select Se te!ber 2012 rulings of the Phili ine Su re!e Court on labor la" and rocedure# ;reach of contract$ Contract substitution$ Constructi'e dis!issal$ (llegal recruit!ent. 4he agency and its rinci al, -odern -etal, co!!itted a rohibited ractice and engaged in illegal recruit!ent "hen they altered or substituted the contracts a ro'ed by the Phili ine *'erseas +! loy!ent Ad!inistration .P*+A0. Article =E .i0 of the Labor Code ro'ides# (t shall be unla"ful for any indi'idual, entity, licensee, or holder of authority to substitute or alter e! loy!ent contracts a ro'ed and 'erified by the De art!ent of Labor fro! the ti!e of actual signing thereof by the arties u to and including the eriod of e2 iration of the sa!e "ithout the a ro'al of the Secretary of Labor. -ean"hile, Article =7 .i0 of the Labor Code, as a!ended by /.A. 70E2, defined Cillegal recruit!entD to include the substitution or alteration, to the re3udice of the "or%er, of e! loy!ent contracts a ro'ed and 'erified by the De art!ent of Labor and +! loy!ent fro! the ti!e of actual signing thereof by the arties u to and including the eriod of the e2 iration of the sa!e "ithout the a ro'al of the De art!ent of Labor and +! loy!ent. 9urther!ore, the agency and -odern -etal co!!itted breach of contract by ro'iding substandard "or%ing and li'ing arrange!ents, "hen the contract ro'ided free and suitable housing. 4he li'ing ,uarters "ere cra! ed as they shared the! "ith 2A other "or%ers. 4he lodging house "as far fro! the 3obsite, lea'ing the! only three to four hours of slee e'ery "or%day because of the long hours of tra'el to and fro! their lace of "or%, not to !ention that there "as no otable "ater in the lodging house "hich "as located in an area "here the air "as olluted. 4hey co! lained "ith the agency about the hardshi s that they "ere suffering, but the agency failed to act on their re orts. Significantly, the agency failed to refute their clai!s. 4hus, "ith their original contracts substituted and their o ressi'e "or%ing and li'ing conditions un!itigated or unresol'ed, the decision to resign is not sur rising. 4hey "ere co! elled by the dis!al state of their e! loy!ent to gi'e u their 3obs$ effecti'ely, they "ere constructi'ely dis!issed. A constructi'e dis!issal or discharge is Ca ,uitting because continued e! loy!ent is rendered i! ossible, unreasonable or unli%ely, as, an offer in'ol'ing a de!otion in ran% and a di!inution in ay.D

&ithout doubt, continued e! loy!ent "ith -odern -etal had beco!e unreasonable. A reasonable !ind "ould not a ro'e of a substituted contract that ays a di!inished salary ? fro! 1=B0 A+D a !onth in the original contract to 1,000 A+D to 1,200 A+D in the a oint!ent letters, a difference of 1B0 A+D to 2B0 A+D .not 3ust B0 A+D as the agency clai!ed0 or an e2tended e! loy!ent .fro! 2 to = years0 at such inferior ter!s, or a Cfree and suitableD housing "hich is hours a"ay fro! the 3ob site, cra! ed and cro"ded, "ithout otable "ater and e2 osed to air ollution. &e thus cannot acce t the agency)s insistence that the res ondents 'oluntarily resigned since they ersonally re ared their resignation letters in their o"n hand"riting. Pert/,PM Manpower E7ponent ,o., Inc. vs. Amando A. /inuya, et al. 8./. :o. 16AB27. Se te!ber B, 2012. Disability benefit. Dee!ed read and incor orated into the Contract of +! loy!ent bet"een Da'id and res ondents are the ro'isions of the 2000 Phili ine *'erseas +! loy!ent Agency Standard +! loy!ent Contract .P*+AS+C0. Sec. 20.;0.E0 of the P*+A1S+C clearly established a dis utable resu! tion in fa'or of the co! ensability of an illness suffered by a seafarer during the ter! of his contract. Hence, unless contrary e'idence is resented by the seafarer)s e! loyer<s, this dis utable resu! tion stands. (n this case, Da'id not only relies on this dis utable resu! tion of the co! ensability of his illness but Da'id has ro'ided !ore than a reasonable ne2us bet"een the nature of his 3ob and the disease that !anifested itself on the si2th !onth of his last contract "ith res ondents. (t is not necessary that the nature of the e! loy!ent be the sole and only reason for the illness suffered by the seafarer. (t is sufficient that there is a reasonable lin%age bet"een the disease suffered by the e! loyee and his "or% to lead a rational !ind to conclude that his "or% !ay ha'e contributed to the establish!ent or, at the 'ery least, aggra'ation of any re1e2isting condition he !ight ha'e had. Da'id sho"ed that art of his duties as a 4hird *fficer of the crude tan%er -<4 /a hael in'ol'ed Co'erseeing the loading, sto"age, securing and unloading of cargoes.D As a necessary corollary, Da'id "as fre,uently e2 osed to the crude oil that -<4 /a hael "as carrying. 4he che!ical co! onents of crude oil include, a!ong others, sulfur, 'anadiu! and arsenic co! ounds. Hydrogen sulfide and carbon !ono2ide !ay also be encountered, "hile ben5ene is a naturally occurring che!ical in crude oil. (t has been regarded that these ha5ardous che!icals can ossibly contribute to the for!ation of cancerous !asses. (n this case, Da'id "as diagnosed "ith -9H .no" %no"n as undifferentiated leo!or hic sarco!a MGPSN0, "hich is a class of soft tissue sarco!a or an illness that account for a ro2i!ately 1H of the %no"n !alignant tu!ors. As stated by Dr. PeTa of the --C, "ho "as consulted by the co! any1designated hysician, the etiology of soft tissue sarco!as are !ultifactorial. Ho"e'er, so!e factors are associated "ith a higher ris%. 4hese factors include e2 osure to che!ical carcinogens li%e so!e of the che!ical co! onents of crude oil. (essie /. 3avid, represented by *is wi5e, Ma. ?*eresa ). 3avid, and c*ildren, Dat*erine and Dristina 3avid vs. <)G )*ipmanagement Manila, Inc. and/or Mic*aelmar )*ipping )ervices. 8./. :o. 16A20B. Se te!ber 2>, 2012. Dis!issal$ Gnfair labor ractice$ Liability of cor orate officers$ -oral and e2e! lary da!ages. 4he re,uisites for a 'alid dis!issal are# .a0 the e! loyee !ust be afforded due rocess, i.e., he !ust be gi'en an o ortunity to be heard and defend hi!self$ and .b0 the dis!issal !ust be for a

'alid cause as ro'ided in Article 272 of the Labor Code, or for any of the authori5ed causes under Articles 27= and 27E of the sa!e Code. (n the case before us, both ele!ents are co! letely lac%ing. /es ondents "ere dis!issed "ithout any 3ust or authori5ed cause and "ithout being gi'en the o ortunity to be heard and defend the!sel'es. 4he la" !andates that the burden of ro'ing the 'alidity of the ter!ination of e! loy!ent rests "ith the e! loyer. 9ailure to discharge this e'identiary burden "ould necessarily !ean that the dis!issal "as not 3ustified and, therefore, illegal. Gnsubstantiated sus icions, accusations, and conclusions of e! loyers do not ro'ide for legal 3ustification for dis!issing e! loyees. (n case of doubt, such cases should be resol'ed in fa'or of labor, ursuant to the social 3ustice olicy of labor la"s and the Constitution. Anent the charge of unfair labor ractice, Article 2E7 .a0 of the Labor Code considers it an unfair labor ractice "hen an e! loyer interferes, restrains or coerces e! loyees in the e2ercise of their right to self1organi5ation or the right to for! an association. (n order to sho" that the e! loyer co!!itted unfair labor ractice under the Labor Code, substantial e'idence is re,uired to su ort the clai!. Substantial e'idence has been defined as such rele'ant e'idence as a reasonable !ind !ight acce t as ade,uate to su ort a conclusion. (n the case at bar, res ondents "ere indeed uncere!oniously dis!issed fro! "or% by reason of their intent to for! and organi5e a union. A cor oration, being a 3uridical entity, !ay act only through its directors, officers and e! loyees. *bligations incurred by the!, "hile acting as cor orate agents, are not their ersonal liability but the direct accountability of the cor oration they re resent. Ho"e'er, cor orate officers !ay be dee!ed solidarily liable "ith the cor oration for the ter!ination of e! loyees if they acted "ith !alice or bad faith. (n the resent case, the lo"er tribunals unani!ously found that Percy and Harbutt, in their ca acity as cor orate officers of ;urgos, acted !aliciously in ter!inating the ser'ices of res ondents "ithout any 'alid ground and in order to su ress their right to self1organi5ation. Section =1 of the Cor oration Code !a%es a director ersonally liable for cor orate debts if he "illfully and %no"ingly 'otes for or assents to atently unla"ful acts of the cor oration. (t also !a%es a director ersonally liable if he is guilty of gross negligence or bad faith in directing the affairs of the cor oration. 4hus, Percy and Harbutt, ha'ing acted in bad faith in directing the affairs of ;urgos, are 3ointly and se'erally liable "ith the latter for res ondents) dis!issal. 4he a"ards of !oral and e2e! lary da!ages in fa'or of res ondents are also in order. -oral da!ages !ay be reco'ered "here the dis!issal of the e! loyee "as tainted by bad faith or fraud, or "here it constituted an act o ressi'e to labor, and done in a !anner contrary to !orals, good custo!s or ublic olicy, "hile e2e! lary da!ages are reco'erable only if the dis!issal "as done in a "anton, o ressi'e, or !ale'olent !anner. 4he grant of attorney)s fees is li%e"ise ro er. Attorney)s fees !ay li%e"ise be a"arded to res ondents "ho "ere illegally dis!issed in bad faith and "ere co! elled to litigate or incur e2 enses to rotect their rights by reason of the o ressi'e acts of etitioners. 4he un3ustified act of etitioners had ob'iously co! elled res ondents to institute an action ri!arily to rotect their rights and interests "hich "arrants the granting of the a"ard. Par9 >otel, et al. vs. Manolo )oriano, et al. 8./. :o. 1A1117. Se te!ber 10, 2012. +! loy!ent ter!ination$ Substanti'e and rocedural due rocess$ -ass lea'e$ Stri%e. Petitioners "ere illegally dis!issed as they "ere not afforded substanti'e and rocedural due rocess. 4o 3ustify the dis!issal of an e! loyee on the ground of serious !isconduct, the e! loyer !ust first establish that the e! loyee is guilty of i! ro er conduct, that the e! loyee

'iolated an e2isting and 'alid co! any rule or regulation, or that the e! loyee is guilty of a "rongdoing. (n the instant case, ;io!edica failed to e'en resent a co y of the rules and to ro'e that etitioners "ere !ade a"are of such regulations. 4he accusation is for engaging in a !ass lea'e tanta!ount to an illegal stri%e. 4he hrase C!ass lea'eD !ay refer to a si!ultaneous a'ail!ent of authori5ed lea'e benefits by a large nu!ber of e! loyees in a co! any. Here, only B e! loyees "ere absent on the sa!e day. 4hey did not go on stri%e, "hich is a te! orary sto age of "or% by the concerted action of e! loyees as a result of any industrial or labor dis ute. CConcertedD is defined as C!utually contri'ed or lannedD or C erfor!ed in unisonD. (n the case at bar, the B etitioners "ent on lea'e for 'arious reasons. 4hey "ere in different laces to attend to their ersonal needs or affairs. 4he etitioners "ere charged "ith conducting an illegal stri%e, not a !ass lea'e, "ithout s ecifying the e2act acts that the co! any considers as constituting an illegal stri%e or 'iolati'e of co! any olicies. Such allegation falls short of the re,uire!ent in Iing of Iings 4rans ort, (nc. of Ca detailed narration of the facts and circu!stances that "ill ser'e as basis for the charge against the e! loyees.D A bare !ention of an Cillegal stri%eD "ill not suffice. 9urther, "hile ;io!edica cites the ro'isions of the co! any olicy "hich etitioners ur ortedly 'iolated, it failed to ,uote said ro'isions in the notice so etitioners can be ade,uately infor!ed of the nature of the charges against the! and intelligently file their e2 lanation and defenses to said accusations. -oreo'er, the eriod of 2E hours allotted to etitioners to ans"er the notice "as se'erely insufficient and in 'iolation of the i! le!enting rules of the Labor Code. Gnder the i! le!enting rule of Art. 2AA, an e! loyee should be gi'en Creasonable o ortunityD to file a res onse to the notice. (n addition, ;io!edica did not set the charges against etitioners for hearing or conference. &hile etitioners did not sub!it any "ritten e2 lanation to the charges, it is incu!bent for ;io!edica to set the !atter for hearing or conference to hear the defenses and recei'e e'idence of the e! loyees. -ore i! ortantly, ;io!edica is duty1bound to e2ert efforts, during said hearing or conference, to ha!!er out a settle!ent of its differences "ith etitioners. 4hese rescri tions ;io!edica failed to satisfy. Lastly, ;io!edica again de'iated fro! the dictated contents of a "ritten notice of ter!ination as laid do"n in Sec. 2, ;oo% F, /ule K((( of the (! le!enting /ules that it should e!body the facts and circu!stances to su ort the grounds 3ustifying the ter!ination. Ale7 B. aranHo, et al. vs. -iomedica >ealt* ,are, Inc., et al. 8./. :o. 16=A76. Se te!ber 16, 2012. +! loyee dis!issal$ /einstate!ent. 9ollo"ing Article 2A6 of the Labor Code, an e! loyee "ho is un3ustly dis!issed fro! "or% is entitled to reinstate!ent "ithout loss of seniority rights and other ri'ileges and to his full bac%"ages co! uted fro! the ti!e he "as illegally dis!issed. Ho"e'er, considering that res ondent Da%ila "as ter!inated one .10 day rior to his co! ulsory retire!ent on -ay 2, 200A, his reinstate!ent is no longer feasible. Accordingly, the :L/C correctly held hi! entitled to the ay!ent of his retire!ent benefits ursuant to the C;A. *n the other hand, his bac%"ages should be co! uted only for days rior to his co! ulsory retire!ent "hich in this case is only a day. Conse,uently, the a"ard of reinstate!ent "ages ending a eal !ust be deleted for lac% of basis. ?*e ew P*ilippine )9ylanders, Inc. and/or (enni5er M. EKano.-ote vs. 2rancisco . 3a9ila. 8./. :o. 166BEA. Se te!ber 2E, 2012 +'idence$ Constructi'e dis!issal$ 4ransfer$ Substantial e'idence. (n labor cases, strict adherence "ith the technical rules is not re,uired. 4his liberal olicy, ho"e'er, should still confor! to the

rudi!ents of e,uitable rinci les of la". 9or instance, belated sub!ission of e'idence !ay only be allo"ed if the delay is ade,uately 3ustified and the e'idence is clearly !aterial to establish the arty)s cause. Labor tribunals, such as the :L/C, are not recluded fro! recei'ing e'idence sub!itted on a eal as technical rules are not binding in cases sub!itted before the!. Ho"e'er, any delay in the sub!ission of e'idence should be ade,uately e2 lained and should ade,uately ro'e the allegations sought to be ro'en. (n the resent case, -*/+SC* (()s belated sub!ission of e'idence cannot be er!itted. -*/+SC* (( did not cite any reason "hy it had failed to file its osition a er or resent its cause before the Labor Arbiter des ite sufficient notice and ti!e gi'en to do so. *nly after an ad'erse decision "as rendered did it resent its defense and rebut the e'idence of Cagala"an by alleging that his transfer "as !ade in res onse to the letter1re,uest of the area !anager of the 8inoog sub1office as%ing for additional ersonnel to !eet its collection ,uota. 4o our !ind, ho"e'er, the belated sub!ission of the said letter1 re,uest "ithout any 'alid e2 lanation casts doubt on its credibility, es ecially so "hen the sa!e is not a ne"ly disco'ered e'idence. 4he rule is that it is "ithin the a!bit of the e! loyer)s rerogati'e to transfer an e! loyee for 'alid reasons and according to the re,uire!ent of its business, ro'ided that the transfer does not result in de!otion in ran% or di!inution of salary, benefits and other ri'ileges. 4his Court has al"ays considered the !anage!ent)s rerogati'e to transfer its e! loyees in ursuit of its legiti!ate interests. ;ut this rerogati'e should be e2ercised "ithout gra'e abuse of discretion and "ith due regard to the basic ele!ents of 3ustice and fair lay, such that if there is a sho"ing that the transfer "as unnecessary or incon'enient and re3udicial to the e! loyee, it cannot be u held. Here, "hile "e find that the transfer of Cagala"an neither entails any de!otion in ran% since he did not ha'e tenurial security o'er the osition of head of the disconnection cre", nor result to di!inution in ay as this "as not sufficiently ro'en by hi!, -*/+SC* (()s e'idence is ne'ertheless not enough to sho" that said transfer "as re,uired by the e2igency of the electric coo erati'e)s business interest. Si! ly stated, the e'idence sought to be ad!itted by -*/+SC* (( is not substantial to ro'e that there "as a genuine business urgency that necessitated the transfer. &hen there is doubt bet"een the e'idence sub!itted by the e! loyer and that sub!itted by the e! loyee, the scales of 3ustice !ust be tilted in fa'or of the e! loyee. 4his is consistent "ith the rule that an e! loyer)s cause could only succeed on the strength of its o"n e'idence and not on the "ea%ness of the e! loyee)s e'idence. 4hus, -*/+SC* (( cannot rely on the "ea%ness of *rti5)s certification in order to gi'e !ore credit to its o"n e'idence. Self1ser'ing and unsubstantiated declarations are not sufficient "here the ,uantu! of e'idence re,uired to establish a fact is substantial e'idence, described as !ore than a !ere scintilla. 4he e'idence !ust be real and substantial, and not !erely a arent. -*/+SC* (( has !iserably failed to discharge the onus of ro'ing the 'alidity of Cagala"an)s transfer. Misamis <riental II Electric )ervice ,ooperative 1M<RE),< II4 vs. /irgilio M. ,agalawan. 8./. :o. 1AB1A0. Se te!ber B, 2012. /etire!ent benefits. &hile it is true that based on re'ailing 3uris rudence, disallo"ed benefits recei'ed in good faith need not be refunded, the case before us !ay be distinguished fro! those cases "ith that ruling because the !onies in'ol'ed here are retire!ent benefits. /etire!ent benefits belong to a different class of benefits. All the cases "ith that ruling in'ol'ed benefits such as cash gifts, re resentation allo"ances, rice subsidies, unifor! allo"ances, er die!s, trans ortation allo"ances, and the li%e. 4he foregoing allo"ances or fringe benefits are gi'en in addition to one)s salary, either to rei!burse hi! for e2 enses he !ight ha'e incurred in relation to his "or%, or as a for! of su le!entary co! ensation. *n the other hand, retire!ent benefits

are gi'en to one "ho is se arated fro! e! loy!ent either 'oluntarily or co! ulsorily. Such benefits, sub3ect to certain re,uisites i! osed by la" and<or contract, are gi'en to the e! loyee on the assu! tion that he can no longer "or%. 4hey are also gi'en as a for! of re"ard for the ser'ices he had rendered. 4he ur ose is not to enrich hi! but to hel hi! during his non1 roducti'e years. *ur Decision does not reclude the retirees fro! recei'ing retire!ent benefits ro'ided by e2isting retire!ent la"s. &hat they are rohibited fro! getting are the additional benefits under the 8S(S /9P, "hich "e found to ha'e e!anated fro! a 'oid and illegal board resolution. 4o allo" the ayees to retain the disallo"ed benefits "ould a!ount to their un3ust enrich!ent to the re3udice of the 8S(S, "hose a'o"ed ur ose is to !aintain its actuarial sol'ency to finance the retire!ent, disability, and life insurance benefits of its !e!bers. Government )ervice Insurance )ystem 1G)I)4, et al. vs. ,ommission on Audit 1,<A4, et al. 8./. :o. 1>2=A2. Se te!ber 11, 2012. /elease<Quitclai!$ Se aration ay. 4he release<,uitclai! affida'its are in'alid for being against ublic olicy for t"o reasons# .10 the ter!s of the settle!ent are unconscionable$ the se aration ay for ter!ination due to reorgani5ation<restructuring "as deficient by Ph E00,000.00 for each e! loyee$ they "ere gi'en only half of the a!ount they "ere legally entitled to$ and .20 the absence of 'oluntariness "hen the e! loyees signed the docu!ent, it "as their dire circu!stances and inability to su ort their fa!ilies that finally dro'e the! to acce t the a!ount offered. &ithout 3obs and "ith fa!ilies to su ort, they dallied in e2ecuting the ,uitclai! instru!ent, but "ere e'entually forced to sign gi'en their circu!stances. 4o be sure, a settle!ent under these ter!s is not and cannot be a reasonable one, gi'en es ecially the res ondent)s length of ser'ice ? 2B years for Obarola and 16 years for /i'era. Radio Mindanao etwor9, Inc. and Eric ). ,anoy vs. 3omingo G. Ebarola, et al. 8./. :o. 167>>2. Se te!ber 12, 2012. /es 3udicata. C/es 3udicata !eans a !atter ad3udged$ a thing 3udicially acted u on or decided$ a thing or !atter settled by 3udg!ent.D (t denotes Cthat a final 3udg!ent or decree on the !erits by a court of co! etent 3urisdiction is conclusi'e of the rights of the arties or their ri'ies in all latter suits on all oints and !atters deter!ined in the for!er suit. 9or res 3udicata, in its conce t as a bar by for!er 3udg!ent to a ly, the follo"ing !ust be resent# 1. 2. =. 4he for!er 3udg!ent or order is final$ (t is rendered by a court ha'ing 3urisdiction o'er the sub3ect !atter and the arties$ (t is a 3udg!ent or an order on the !erits$ and,

E. 4here is bet"een the first and the second identity of arties, identity of sub3ect !atter, and identity of cause of action. 4he Decision of this Court in 8./. :os. 1B6E>0 and 1B6E>1 beca!e final and e2ecutory on -ay 20, 2011. (t is a decision based on the !erits of the case and rendered by this Court in the e2ercise of its a ellate 3urisdiction after the arties in'o%ed its 3urisdiction. 4here is also, bet"een the t"o sets of consolidated cases, identity of the arties, sub3ect !atter and causes of action. 4he arties in 8./. :o. 1B6E>0 and 1B6E>1 are also i! leaded as arties in these consolidated cases. And "hile so!e of the arties herein are not included in 8./. :os. 1B6E>0 and 1B6E>1, the sa!e are only fe". (n any e'ent, it is "ell1settled that only substantial, and not absolute, identity of the arties is re,uired for res 3udicata to lie. C4here is substantial identity of

the arties "hen there is a co!!unity of interest bet"een a arty in the first case and a arty in the second case albeit the latter "as not i! leaded in the first case.D &ith regard to identity of cause of action, it has been held that there is identity of causes of action "hen the sa!e e'idence "ill sustain both actions or "hen the facts essential to the !aintenance of the t"o actions are identical. Here, the bone of contention in both sets of consolidated cases boils do"n to the nature and conse,uences of co! lainants) A ril =, 2000 !ass action. 4he antecedent facts that ga'e rise to all the cases "ere the sa!e. :ecessarily, therefore, the sa!e e'idence "ould sustain all actions. Such si!ilarity in the e'idence re,uired to sustain all actions is also borne out by the identity of the issues in'ol'ed in all these cases. &hile the arties ha'e resented a lethora of argu!ents "hich "e earlier discussed at length, the sa!e nonetheless boil do"n to the sa!e crucial issues for!ulated in 8./. :os. 1B6E>0 and 1B6E>1. (t should be recalled that in 8./. :o. 1B=A66, the co! lainants assailed the /esolutions dated January 1E, 2002 and 9ebruary 20, 2002 of the CA)s 9ourth Di'ision granting -etroban%)s re,uest for in3uncti'e reliefs. 4hey clai!ed that the reinstate!ent as ect of the Labor Arbiter)s Decision is i!!ediately e2ecutory. Hence, they are entitled to bac%"ages fro! the ti!e the Labor Arbiter ro!ulgated his Decision until it "as re'ersed by the :L/C. As discussed abo'e, ho"e'er, the :o'e!ber 1B, 2010 Decision of this Court in 8./. :os. 1B6E>0 and 1B6E>1 already ad3udicated the res ecti'e rights and liabilities of the arties. Said Decision ronouncing the !onetary a"ards to "hich the arties herein are entitled beca!e final and e2ecutory on -ay 20, 2011. Gnder the rule on i!!utability of 3udg!ent, this Court cannot alter or !odify said Decision. (t is a "ell1established rule that once a 3udg!ent has beco!e final and e2ecutory, it is no longer susce tible to any !odification. )olidban9 Union, et al. vs. Metropolitan -an9 and ?rust ,ompany/Metropolitan -an9 and ?rust ,ompany vs. )olidban9 Union, et al./)olidban9 ,orporation, etc., et al. vs. )olidban9 Union, et al./)olidban9 Union, et al. vs. Metropolitan -an9 and ?rust ,ompany. 8./. :o. 1B=A66<8./. :o. 1BA1>6<8./. :o. 1BA=2A<8./. :o. 1BAB0>. Se te!ber 1A, 2012. /einstate!ent$ Strained relations. A deter!ination of the a licability of the doctrine of strained relations is essentially a factual ,uestion and, thus, not a ro er sub3ect in this etition. 4his rule, ho"e'er, ad!its of e2ce tions. (n cases "here the factual findings of the LA and the :L/C are conflicting, the Court, in the e2ercise if e,uity 3urisdiction, !ay re'ie" and re1 e'aluate the factual issues and loo% into the records of the case and re1e2a!ine the ,uestioned findings. As the records bear out, the LA found that atent ani!osity e2isted bet"een AC-C and ;ides considering the confrontation that too% lace bet"een the latter and -atthe". 4he confrontation cou led "ith ;ides) refusal to be reinstated led to the LA)s finding of Cstrained relationsD necessitating an a"ard of se aration ay in lieu of reinstate!ent. 4he :L/C, on the other hand, deleted the said a"ard for lac% of factual basis. 4he CA reinstated the LA)s finding of Cstrained relationsD and e2 lained that too !uch en!ity had de'elo ed bet"een AC-C and ;ides that necessarily barred the latter)s reinstate!ent. 4he Court is "ell a"are that reinstate!ent is the rule and, for the e2ce tion of Cstrained relationsD to a ly, it should be ro'ed that it is li%ely that, if reinstated, an at!os here of anti athy and antagonis! "ould be generated as to ad'ersely affect the efficiency and roducti'ity of the e! loyee concerned.

Gnder the doctrine of strained relations, the ay!ent of se aration ay is considered an acce table alternati'e to reinstate!ent "hen the latter o tion is no longer desirable or 'iable. *n one hand, such ay!ent liberates the e! loyee fro! "hat could be a highly o ressi'e "or% en'iron!ent. *n the other hand, it releases the e! loyer fro! the grossly un alatable obligation of !aintaining in its e! loy a "or%er it could no longer trust. -oreo'er, the doctrine of strained relations has been !ade a licable to cases "here the e! loyee decides not to be reinstated and de!ands for se aration ay. (n the resent case, ;ides has consistently !aintained, fro! the roceedings in the LA u to the CA, his refusal to be reinstated due to his fear of re risal "hich he could e2 erience as a conse,uence of his return. ;y doing so, ;ides une,ui'ocally foreclosed reinstate!ent as a relief. Apo ,*emical Manu5acturing and Mic*ael ,*eng vs. Ronaldo A. -ides. 8./. :o. 17>002. Se te!ber 16, 2012. Seafarers disability benefits$ Attorney)s fees. (n deter!ining the disability benefits due a seafarer the P*+A Standard +! loy!ent Contract .S+C0, s ecifically its schedule of benefits, !edical findings, Article 162 .c0.10 of the Labor Code, and /ule K, Section 2 of its i! le!enting rules and regulations !ust be considered. 4he initial treat!ent eriod of 120 days !ay be e2tended u to a !a2i!u! of 2E0 days under the conditions rescribed by la". Gnder Article 2267 of the Ci'il Code, attorney)s fees can be reco'ered CM"Nhen the defendant)s act or o!ission has co! elled the laintiff to litigate "ith third ersons or to incur e2 enses to rotect his interest.D 4his Court sees no reason "hy da!ages or attorney)s fees should be a"arded to Penales. (t is ob'ious that he did not gi'e the etitioners) co! any1designated hysician a! le ti!e to assess and e'aluate his condition, or to treat hi! ro erly for that !atter. 4he etitioners had a 'alid reason for refusing to ay his clai!s, es ecially "hen they "ere co! lying "ith the ter!s of the P*+A S+C "ith regard to his allo"ances and treat!ent. Paci5ic <cean Manning Inc., et al. vs. -enHamin 3. Penales. 8./. :o. 1>2706. Se te!ber B, 2012.

January 201( Philippine Supreme Court Decisions on Labor Law and Procedure
Posted on 9ebruary 11, 201= by Leslie C. Dy W Posted in Labor La", Phili ines 1 Cases, Phili ines 1 La" W 4agged a eal, arbitration, bac%"ages, foru! sho ing, :L/C, redundancy, reinstate!ent W Lea'e a co!!ent Here are select January 201= rulings of the Su re!e Court of the Phili ines on labor la" and rocedure# A eal to the :ational Labor /elations Co!!ission .:L/C0$ /e,uisites for erfection of a eal$ Joint declaration under oath acco! anying the surety bond$ Substantial co! liance "ith rocedural rules. 4here "as substantial co! liance "ith the :L/C /ules of Procedure "hen the res ondents PAL -ariti!e Cor oration and &estern Shi ing Agencies, Pte., Ltd. filed, albeit

belatedly, the Joint Declaration Gnder *ath, "hich is re,uired "hen an e! loyer a eals fro! the Labor Arbiter)s decision granting a !onetary a"ard and osts a surety bond. Gnder the :L/C rules, the follo"ing re,uisites are re,uired to erfect the e! loyer)s a eal# .10 it !ust be filed "ithin the regle!entary eriod$ .20 it !ust be under oath, "ith roof of ay!ent of the re,uired a eal fee and the osting of a cash or surety bond$ and .=0 it !ust be acco! anied by ty e"ritten or rinted co ies of the !e!orandu! of a eal, stating the grounds relied u on, the su orting argu!ents, the reliefs rayed for, and a state!ent of the date of recei t of the a ealed decision, "ith roof of ser'ice on the other arty of said a eal. (f the e! loyer osts a surety bond, the :L/C rules further re,uire the sub!ission by the e! loyer, his or her counsel, and the bonding co! any of a 3oint declaration under oath attesting that the surety bond osted is genuine and that it shall be in effect until the final dis osition of the case. (n the case at bar, the res ondents osted a surety bond e,ui'alent to the !onetary a"ard and filed the notice of a eal and the a eal !e!orandu! "ithin the regle!entary eriod. &hen the :L/C subse,uently directed the filing of a Joint Declaration Gnder *ath, the res ondents i!!ediately co! lied "ith the said order. 4here "as only a late sub!ission of the Joint Declaration. Considering that there "as substantial co! liance "ith the rules, the sa!e !ay be liberally construed. 4he a lication of technical rules !ay be rela2ed in labor cases to ser'e the de!ands of substantial 3ustice. Rolando 0. ,ervantes vs. PA0 Maritime ,orporation and/or Aestern )*ipping Agencies, Pte., 0td. 8./. :o. 1AB206. January 1>, 201=. Co! leteness of ser'ice by registered !ail$ +2ce tion to the general rule regarding a cor oration)s 'erification and certification of non1foru! sho ing$ (nter retation of school C;A. A school C;A !ust be read in con3unction "ith statutory and ad!inistrati'e regulations go'erning faculty ,ualifications. Such regulations for! art of a 'alid C;A "ithout need for the arties to !a%e e2 ress reference to the sa!e. (n the case at bar, the Gni'ersity of the +ast .G+0 re eatedly e2tended only se!ester1to1se!ester faculty a oint!ents to the res ondents Pe anio and ;ueno, since they had not co! leted ostgraduate degrees. 4he res ondents, ho"e'er, clai!ed that the 166E C;A bet"een G+ and the faculty union did not yet re,uire a !aster)s degree for a teacher to ac,uire regular status. Ha'ing rendered !ore than three consecuti'e years of full1ti!e ser'ice to the school, the res ondents insisted that G+ should ha'e gi'en the! er!anent a oint!ents. 4he Su re!e Court obser'ed that the olicy re,uiring college teachers to ha'e ostgraduate degrees "as ro'ided in the -anual of /egulations issued as early as 1662 by the De art!ent of +ducation, Culture and S orts .D+CS0, no" the De art!ent of +ducation. (n ro!ulgating the -anual of /egulations, D+CS e2ercised its o"er of regulation o'er educational institutions, "hich includes rescribing the !ini!u! acade!ic ,ualifications for teaching ersonnel. 4he legislature subse,uently transferred the o"er to rescribe such ,ualifications for teachers in institutions of higher learning to the Co!!ission on Higher +ducation .CH+D0. Ho"e'er, the 1662 -anual of /egulations issued by D+CS continued to a ly to colleges and uni'ersities until 2010, "hen CH+D issued a /e'ised -anual of /egulations. 4hus, the re,uire!ent of a !aster)s degree for college teachers, as originally ro'ided in the 1662 -anual of /egulations, "as dee!ed incor orated in the 166E C;A bet"een G+ and the faculty union. 9urther!ore, the subse,uent C;A in 2001, "hich ro'ided for the e2tension of conditional robationary status to the res ondents, sub3ect to their obtaining a !aster)s degree "ithin the robationary eriod, clearly sho"ed that G+ intended to sub3ect the res ondents) a oint!ents to the standards set by the la".

4he re,uire!ent of a !aster)s degree for tertiary education teachers is not unreasonable, considering that the o eration of educational institutions in'ol'es ublic interest. 4he go'ern!ent has a right to ensure that only ,ualified ersons, in ossession of sufficient acade!ic %no"ledge and teaching s%ills, are allo"ed to teach in such institutions. 4he Su re!e Court also o'erruled the res ondents) contention that G+ filed its a eal to the :L/C beyond the re,uired ten .1001day eriod. 9or co! leteness of ser'ice by registered !ail, the rec%oning eriod starts either fro! the date of actual recei t of the !ail by the addressee or after fi'e .B0 days fro! the date he or she recei'ed the first notice fro! the ost!aster. (n this case, the res ondents a'erred that, on -arch 1A, 200B, the ost!aster ga'e G+)s counsel a notice to clai! the !ail containing the Labor Arbiter)s decision. 4he res ondents clai!ed that G+)s counsel "as dee!ed in recei t of the decision B days after the gi'ing of the notice, or on -arch 22, 200B. 4hus, according to the res ondents, "hen G+ filed its a eal to the :L/C on A ril 1E, 200B, the 101day regle!entary eriod had already la sed. 4he Su re!e Court, ho"e'er, ruled that there !ust be conclusi'e roof that the registry notice "as recei'ed by or at least ser'ed on the addressee. (n this case, the records did not sho" that G+)s counsel in fact recei'ed the alleged registry notice re,uiring hi! to clai! the !ail. *n the other hand, G+ "as able to resent a registry return recei t sho"ing that its counsel actually recei'ed a co y of the Labor Arbiter)s decision on A ril E, 200B. /ec%oned fro! this date, the 101day regle!entary eriod had not yet la sed "hen G+ filed its a eal to the :L/C on A ril 1E, 200B. Anent G+)s failure to co! ly "ith the general rule that the ;oard of Directors or ;oard of 4rustees of a cor oration !ust authori5e the erson "ho shall sign the 'erification and certification of non1foru! sho ing acco! anying a etition, the Su re!e Court held that such authori5ation is not necessary "hen it is self1e'ident that the signatory is in a osition to 'erify the truthfulness and correctness of the allegations in the etition. 4he Su re!e Court declared that Dean +leanor Ja'ier, "ho signed G+)s 'erification and certification, "as in such a osition, since she %ne" the factual antecedents of the case and she actually co!!unicated "ith the res ondents regarding the re,uired ostgraduate ,ualification. University o5 t*e East, et al. vs. Anali@a 2. Pepanio and Mariti 3. -ueno. 8./. :o. 16=76A. January 2=, 201=. Disease as a ground for ter!ination$ /etire!ent under the Labor Code$ Age and tenure re,uire!ents for retire!ent$ 9inancial assistance. Gnder the Labor Code ro'ision on disease as a ground for ter!ination .for!erly, Article 27E, but no" renu!bered ursuant to /e ublic Act :o. 101B10, it !ust be the e! loyer "ho initiates the ter!ination of the e! loyee)s ser'ices. 4he afore!entioned ro'ision cannot be a lied in this case, considering that it "as the late etitioner Padillo, and not the /ural ;an% of :abunturan, (nc. .;an%0, "ho se'ered the e! loy!ent relations. &ith his !e!ory i! aired after suffering a !ild stro%e due to hy ertension, Padillo "rote a letter to the ;an%, e2 ressing his intention to a'ail of an early retire!ent ac%age. 4he clear i! ort of Padillo)s letter and the fact that he had sto ed re orting for "or% e'en before sending the said letter sho"s that he 'oluntarily retired. 8i'en the ina licability of the Labor Code ro'ision on disease as a ground for ter!ination, it necessarily follo"s that Padillo)s clai! for se aration ay !ust be denied. As regards Padillo)s clai! for retire!ent benefits, the ro'ision of the Labor Code on retire!ent .for!erly, Art. 27A, but no" renu!bered ursuant to /.A. :o. 101B10 states that, in the absence of any a licable agree!ent, an e! loyee "ho has ser'ed at least fi'e .B0 years in the co! any !ay retire u on reaching the age of si2ty .>00 years, but not beyond si2ty1fi'e .>B0 years, to be entitled to retire!ent ay e,ui'alent to at least one1half .1<20 !onth salary for e'ery year of ser'ice, "ith a fraction of at least si2 .>0 !onths being considered as one "hole year. :otably,

the afore!entioned age and tenure re,uire!ents are cu!ulati'e, and non1co! liance "ith either negates the e! loyee)s entitle!ent to the retire!ent ay under the Labor Code. (n this case, the ;an% did not ha'e a retire!ent lan or any other contract "ith its e! loyees, setting the ter!s and conditions for retire!ent. Padillo also ser'ed the ;an% for t"enty1nine .260 years, far !ore than the B1year tenure re,uire!ent. Padillo, ho"e'er, did not !eet the age re,uire!ent, considering that he "as only fifty1fi'e .BB0 years old, or less than >0 years of age, "hen he retired. 4hus, Padillo)s clai! for retire!ent ay !ust also be denied. :e'ertheless, the Su re!e Court a"arded Padillo financial assistance in the a!ount of PAB,000, considering the length of ti!e "hich had su er'ened before the dis osition of this case and Padillo)s unble!ished record of 26 years of ser'ice to the ;an%. 4he a"ard "as in addition to the P100,000 benefit recei'able under the Phila! Life Plan that the ;an% had rocured in fa'or of Padillo. Elea@ar ). Padillo vs. Rural -an9 o5 abunturan, Inc., et al. 8./. :o. 166==7. January 21, 201=. /edundancy as an authori5ed cause for ter!ination$ Difference bet"een retire!ent and ter!ination due to redundancy$ 8eneral rule regarding the factual findings of the :L/C and the e2ce tions thereto. Gnder the Labor Code, redundancy is one of the authori5ed causes for ter!ination of e! loy!ent. 4he follo"ing are the re,uisites for the 'alid i! le!entation of a redundancy rogra!# .a0 the e! loyer !ust ser'e a "ritten notice to the affected e! loyees and to the De art!ent of Labor and +! loy!ent .D*L+0 at least one !onth before the intended date of ter!ination$ .b0 the e! loyer !ust ay the e! loyees se aration ay e,ui'alent to at least one !onth ay or at least one !onth ay for e'ery year of ser'ice, "hiche'er is higher$ .c0 the e! loyer !ust abolish the redundant ositions in good faith$ and .d0 the e! loyer !ust set fair and reasonable criteria in ascertaining "hich ositions are redundant and !ay be abolished. 4he Su re!e Court has also held that a co! any cannot si! ly declare redundancy "ithout basis. 4o e2hibit its good faith and to sho" that there "ere fair and reasonable criteria in ascertaining redundant ositions, a co! any clai!ing to be o'er !anned !ust roduce ade,uate roof of the sa!e. (n the case at bar, the 8eneral -illing Cor oration .8-C0 furnished res ondent Fia3ar a "ritten notice infor!ing her of the ter!ination of her ser'ices on the ground of redundancy. 8-C also sub!itted to the D*L+ an +stablish!ent 4er!ination /e ort, regarding the e! loyees, including Fia3ar, "hose ositions "ere dee!ed redundant. Fia3ar and the D*L+ recei'ed the res ecti'e notices one !onth before the effecti'e date of the e! loyees) ter!ination. 9urther!ore, 8-C issued to Fia3ar t"o chec%s a!ounting to PEE0,2B=.02 and P21,211.=B, re resenting her se aration ay. Ho"e'er, the Su re!e Court held that, not"ithstanding co! liance "ith the re,uire!ents on notice and the ay!ent of se aration ay, 8-C is still considered to ha'e illegally dis!issed Fia3ar because the co! any failed to resent substantial roof to su ort its general allegations of redundancy. 8-C could ha'e resented e'idence to substantiate redundancy, such as a ne" staffing attern or feasibility studies or ro osals on the 'iability of ne"ly created ositions, 3ob descri tions and the a ro'al by !anage!ent of the restructuring rogra!, or the co! any)s audited financial re orts. Ho"e'er, no such e'idence "as sub!itted by 8-C. *n the other hand, Fia3ar resented roof negating 8-C)s clai! of redundancy and clearly sho"ing 8-C)s bad faith in i! le!enting the redundancy rogra!# .10 8-C had hired ne" e! loyees before it ter!inated Fia3ar)s e! loy!ent$ .20 Fai3ar "as barred fro! entering the co! any re!ises e'en before the effecti'ity of her se aration$ and .=0 Fia3ar "as also forced to sign an CA lication for /etire!ent and ;enefitsD so that she could a'ail of her se aration ay.

4he last circu!stance is significant, considering that there is a difference bet"een 'oluntary retire!ent and forced ter!ination of an e! loyee. /etire!ent fro! ser'ice is contractual or based on a bilateral agree!ent of the e! loyer and the e! loyee, "hile ter!ination of e! loy!ent is statutory or go'erned by the Labor Code and other related la"s. Foluntary retire!ent cuts e! loy!ent ties, lea'ing no residual e! loyer liability$ in'oluntary retire!ent a!ounts to a discharge, rendering the e! loyer liable for ter!ination "ithout cause. 8-C)s de!and that Fia3ar sign an A lication for /etire!ent and ;enefits, "hen she had already been infor!ed of the ter!ination of her ser'ices due to redundancy, sho"s that this case in'ol'es not a 'oluntary retire!ent, but an illegal ter!ination. &hile the Labor Arbiter and the :L/C both found that Fia3ar "as 'alidly dis!issed, the general rule that the factual findings of the :L/C !ust be accorded res ect and finality is not a licable in this case. *ne of the e2ce tions to the said rule co'ers instances "hen the findings of fact of the trial court, or of the ,uasi13udicial agencies concerned, are conflicting or contradictory "ith those of the Court of A eals, as in the resent case. Another e2ce tion to the general rule is "hen the said findings are not su orted by substantial e'idence or the inference or conclusion arri'ed at is !anifestly erroneous. (n the case at bar, the Su re!e Court agreed "ith the Court of A eals that the :L/C)s conclusion that Fia3ar "as legally dis!issed is !anifestly erroneous. General Milling ,orporation vs. /ioleta 0. /iaHar. 8./. :o. 171A=7. January =0, 201=. /einstate!ent$ ;ac%"ages. (t is basic in 3uris rudence that illegally dis!issed "or%ers are entitled to reinstate!ent "ith bac%"ages lus interest at the legal rate. 4his labor contro'ersy started "hen the e! loyer Auto!oti'e +ngine /ebuilders, (nc. .A+/0 and the Progresibong Gnyon ng !ga -anggaga"a sa A+/ .Gnion0 filed charges against each other for 'iolating labor la"s. A+/ filed a co! laint against the Gnion and eighteen .170 of its !e!bers for conducting an illegal stri%e. *n the other hand, thirty1t"o .=20 e! loyees filed a co! laint against A+/ for unfair labor ractices, illegal dis!issal, illegal sus ension, and run1 a"ay sho . (n a re'ious decision .8./. :o. 1>01=7, July 1=, 20110, the Su re!e Court had held that both arties "ere at fault or in pari delicto$ hence, the co! laining e! loyees should be reinstated but "ithout bac%"ages. 4he -otion for Partial /econsideration filed by the Gnion is resol'ed in the resent case. 4he Su re!e Court found that, of the =2 e! loyees "ho filed the co! laint against A+/, only 17 had been charged by A+/ "ith illegal stri%e, lea'ing 1E e2cluded fro! the e! loyer)s co! laint. As no charges had been filed against the 1E "or%ers, they cannot be found guilty of illegal stri%e. :either can they be considered in pari delicto. Ho"e'er, of the 1E e! loyees, fi'e failed to "rite their na!es and affi2 their signatures in the -e!bershi /esolution attached to their etition before the Court of A eals, authori5ing the union resident to re resent the!. 4hus, "hile these fi'e e! loyees "ill also be reinstated, they cannot be granted bac%"ages. *n the other hand, the nine "or%ers "ho signed their na!es in the afore!entioned -e!bershi /esolution "ill be reinstated "ith bac%"ages lus interest at the legal rate. Automotive Engine Rebuilders, Inc. 1AER4, et al. vs. Progresibong Unyon ng mga Manggagawa sa AER, et al. / Progresibong Unyon ng mga Manggagawa sa AER, et al. vs. Automotive Engine Rebuilders, Inc., et al. 8./. :os. 1>01=7 and 1>0162. January 1>, 201=. /esignation$ /esignation in relation to the subse,uent filing of an illegal dis!issal case. Petitioner Cer'antes)s clai! that he did not resign but "as ter!inated fro! e! loy!ent is untenable. /esignation is the 'oluntary act of an e! loyee "ho finds hi!self in a situation

"here he belie'es that ersonal reasons cannot be sacrificed in fa'or of the e2igency of the ser'ice, such that he has no other choice but to disassociate hi!self fro! his e! loy!ent. (n the resent case, Cer'antes)s e! loyer !erely infor!ed hi! of the nu!erous co! laints against hi!. (t "as Cer'antes hi!self "ho o ted to be relie'ed fro! his ost and "ho initiated his re atriation to -anila. 4his is clear fro! the tenor of his tele2 !essage, "hich reads in art# CA:OH*& 4* AF*(D /+P+4(4(*: M*:N -*/+ HA/SH /+P*/4S 4* C*-+. ;+44+/ A//A:8+ -O /+L(+F+/ MA:DN C<* ;GS4(LL* /+L(+F+/ ALS*. GP*: A// :+K4 GSA L*AD(:8 P*/4 9*/ 4H+(/ SA4(S9AC4(*:.D Cer'antes)s !essage contains an un!ista%able de!and to be relie'ed of his assign!ent. His e! loyer !erely acce ted his resignation. 4hus, the rule that the filing of a co! laint for illegal dis!issal is inconsistent "ith resignation does not hold true in this case. 4he clear tenor of Cer'antes)s resignation letter and the filing of this case one year after his alleged ter!ination sho"s that the co! laint for illegal dis!issal "as a !ere afterthought. Rolando 0. ,ervantes vs. PA0 Maritime ,orporation and/or Aestern )*ipping Agencies, Pte., 0td. 8./. :o. 1AB206. January 1>, 201=. Foluntary Arbitration$ Plenary authority and 3urisdiction of a 'oluntary arbitrator$ Conce t and e2ercise of !anage!ent rerogati'e$ Li!itations on the e2ercise of !anage!ent rerogati'e$ :ature of collecti'e bargaining agree!ents .C;A0. 8oya, (nc.)s contention that the Foluntary Arbitrator .FA0 e2ceeded his o"er in ruling on a !atter not co'ered by the sole issue sub!itted for 'oluntary arbitration is untenable. (n a rior case, the Su re!e Court has ruled that, in general, the arbitrator is e2 ected to decide those ,uestions e2 ressly stated and li!ited in the sub!ission agree!ent. Ho"e'er, since arbitration is the final resort for the ad3udication of dis utes, the arbitrator can assu!e that he has the o"er to !a%e a final settle!ent. 4he FA has lenary 3urisdiction and authority to inter ret the C;A and to deter!ine the sco e of his or her o"n authority. Sub3ect to 3udicial re'ie", this lee"ay of authority and ade,uate rerogati'e is ai!ed at acco! lishing the rationale of the la" on 'oluntary arbitration ? s eedy labor 3ustice. (n the case at bar, 8oya, (nc. and 8oya, (nc. +! loyees Gnion .Gnion0 sub!itted for 'oluntary arbitration the sole issue of "hether or not the co! any is guilty of an unfair labor ractice in engaging the ser'ices of P+S*, a third arty ser'ice ro'ider, under e2isting C;A, la"s, and 3uris rudence. 4he Gnion clai!ed that the hiring of contractual "or%ers fro! P+S* 'iolated the C;A ro'ision that rescribes only three categories of "or%ers in the co! any, na!ely# the robationary, the regular, and the casual e! loyees. (nstead of hiring contractual "or%ers, 8oya, (nc. should ha'e hired robationary or casual e! loyees, "ho could ha'e beco!e additional Gnion !e!bers, ursuant to the union security clause in the C;A. 4he FA ruled that "hile 8oya, (nc. "as not guilty of any unfair labor ractice, it still co!!itted a 'iolation of the C;A, though such 'iolation "as not gross in character. 4he Su re!e Court held that the FA)s ruling is interrelated and intert"ined "ith the sole issue sub!itted for arbitration. 4he ruling "as necessary to !a%e a co! lete and final ad3udication of the dis ute bet"een the arties. 9urther!ore, 8oya, (nc.)s assertion that its hiring of contractual "or%ers "as a 'alid e2ercise of !anage!ent rerogati'e is erroneous. Declaring that a articular act falls "ithin the conce t of !anage!ent rerogati'e is significantly different fro! ac%no"ledging that such act is a 'alid e2ercise thereof. &hile the FA and the Court of A eals ruled that the act of contracting out or outsourcing "or% is "ithin the ur'ie" of !anage!ent rerogati'e, they did not declare such act to be a 'alid e2ercise thereof. As re eatedly held, the e2ercise of !anage!ent rerogati'e is not unli!ited$ it is sub3ect to the li!itations found in the la", C;A, or general rinci les of fair lay and 3ustice.

(n this case, the C;A ro'ision rescribing the categories of e! loyees in the co! any and the union security clause are interconnected and !ust be gi'en full force and effect. 4he arties in a C;A are free to establish such sti ulations they !ay dee! con'enient, ro'ided that the sa!e are not contrary to la", !orals, good custo!s, ublic order, or ublic olicy. &here the C;A is clear and una!biguous, the literal !eaning of its sti ulations shall control. 4he C;A beco!es the la" bet"een the arties, and co! liance there"ith is !andated by the e2 ress olicy of the la". Goya, Inc. vs. Goya, Inc. Employees Union.22A. 8./. :o. 1A00BE. January 21, 201=.

)mplementing *ules and *egulations o# the +atas ,asambahay

Posted on -ay 7, 201= by (!elda A. -anguiat W Posted in Phili ines 1 La", Phili ines 1 /egulation W 4he De art!ent of Labor and +! loy!ent .D*L+0 issued the i! le!enting rules and regulations .(//0 for /e ublic Act :o. 10=>1, other"ise %no"n as the CDo!estic &or%ers ActD or C;atas Iasa!bahay,D on -ay 06, 201=. /e ublic Act :o. 10=>1 defines a Dasamba*ay as a erson engaged in do!estic "or% "ithin an e! loy!ent relationshi such as a househel , nurse!aid or CyayaD, coo%, gardener, or laundry erson, but e2cludes those erfor!ing do!estic "or% on an occasional or s oradic basis. 4he !uch1celebrated -atas Dasamba*ay is said to ha'e institutionali5ed the basic rights of a do!estic "or%er 'is1X1'is !ini!u! "age, rest eriods, ser'ice incenti'e lea'e, thirteenth1!onth ay and social security benefits. :ote that the la" highlights the do!estic "or%er)s right to education and training. Gnder the (//, a Dasamba*ay !ust be afforded the o ortunity to finish basic education, "hich shall consist of ele!entary and secondary education. -oreo'er, the (// !andates the 4echnical +ducation and S%ills De'elo !ent Authority .4+SDA0 to facilitate access of a Dasamba*ay to efficient training on technical1'ocational education, and to coordinate "ith the :ational &ages and Producti'ity Co!!ission .:&PC0 and the /egional 4ri artite &ages and Producti'ity ;oards ./4&P;s0 to de'elo a s%ill<co! etency1based ay syste!. /ecogni5ing the 'ulnerability of do!estic "or%ers to different for!s of abuse, the (// establishes a !echanis! for the rescue and rehabilitation of an abused Dasamba*ay. 9or this ur ose, the (// for!s a rescue tea! co! osed of .10 the !unici al or city social "elfare officer, .20 the concerned barangay officials, and .=0 a ro er la" enforce!ent ersonnel. 4he rescue tea! !ust i!!ediately res ond to any re ort of abuse, and ensure the full rotection of the rights of the rescued Dasamba*ay "hile under its control and custody. 9or the reco'ery and rehabilitation of an abused Dasamba*ay, the (// !andates that he<she be ro'ided "ith a te! orary shelter, counseling, free legal ser'ices, !edical or sychological ser'ices, li'elihood and s%ills training, and other rele'ant ser'ices as !ay be necessary. 9inally, it is "orth noting that -atas Dasamba*ay directs the arties to e2ecute a "ritten e! loy!ent contract before the co!!ence!ent of the ser'ice of a Dasamba*ay. 4he contract !ust be in a language or dialect understood by both the Dasamba*ay and the e! loyer.

A !odel e! loy!ent contract is ro'ided for in the (//. (t is "ritten in 9ili ino and contains ro'isions relating to the Dasamba*ay)s duties and res onsibilities, rest days and lea'es, and co! ensation and benefits a!ong others. (nterestingly, the !odel contract ro'ides for signature bloc%s for "itnesses. 4his is because under the (//, either arty !ay re,uest the Punong ;arangay or his<her designated officer to read and e2 lain the content of the contracts and to ser'e as "itness thereon. 4he -atas Dasamba*ay (// "as ublished last -ay 16. (t "ill ta%e effect 1B days after its ublication.