Appeal

As a rule, a party who does not appeal from the decision may not
obtain any affirmative relief from the appellate court other than what
he has obtained from the lower tribunal, if any, whose decision is
brought up on appeal. Due process prevents the grant of additional
awards to parties who did not appeal. As an exception, he may assign
an error where the purpose is to maintain the judgment on other
grounds, but he cannot seek modification or reversal of the judgment
or affirmative relief unless he has also appealed or filed a separate
petition. (AKLAN COLLEGE, INC. vs. PERPETUO ENERO, ARLYN
CASTIGADOR, NUENA SERMON and JOCELYN ZOLINA, G.R. No. 178309,
January 27, 2009)

Likewise, by availing of a wrong or inappropriate mode of appeal,

the petition merits an outright dismissal pursuant to Circular No. 2-
90 which provides that, “an appeal taken to either Supreme Court
or the Court of Appeals by the wrong or inappropriate mode shall
be dismissed.”( HANJIN HEAVY INDUSTRIES AND CONSTRUCTION
COMPANY LTD. (FORMERLY HANJIN ENGINEERING AND
CONSTRUCTION CO. LTD.) v. HONORABLE COURT OF APPEALS, G.R.
No. 167938, February 19, 2009)

At the outset, it must be stated that petitioners adopted the

wrong mode of remedy in bringing the case before this Court. It is
well-settled that the proper recourse of an aggrieved party to assail
the decision of the Court of Appeals is to file a petition for review on
certiorari under Rule 45 of the Rules of Court. The Rules precludes
recourse to the special civil action of certiorari if appeal, by way of a
petition for review is available, as the remedies of appeal and certiorari
are mutually exclusive and not alternative or successive. (TACLOBAN
FAR EAST MARKETING CORPORATION and FRANCISCO Y. ROMUALDEZ
v. THE COURT OF APPEALS, NATIONAL LABOR RELATIONS
COMMISSION, G.R. No. 182320, September 11, 2009)

Time and again, it has been held that the right to appeal is not a
constitutional right, but a mere statutory privilege. Hence, parties who
seek to avail themselves of it must comply with the statutes or rules
allowing it. To reiterate, perfection of an appeal in the manner and
within the period permitted by law is mandatory and jurisdictional. The
requirements for perfecting an appeal must, as a rule, be strictly
followed. Such requirements are considered indispensable
interdictions against needless delays and are necessary for the orderly
discharge of the judicial business. Failure to perfect the appeal
renders the judgment of the court final and executory. Just as a losing

1
party has the privilege to file an appeal within the prescribed period, so
does the winner also have the correlative right to enjoy the finality of
the decision. Thus, the propriety of the monetary awards of the Labor
Arbiter is already binding upon this Court, much more with the Court of
Appeals. (ANDREW JAMES MCBURNIE v. EULALIO GANZON, EGI-
MANAGERS,INC. and E. GANZON, INC. G.R. Nos. 178034 & 178117,
G.R. Nos. 186984-85, September 18, 2009)

From the immediately quoted pronouncement of the Court in Sy,

petitioner’s mere filing of the Motion for Reduction of Bond did not
suffice to perfect his appeal. As correctly found by the appellate
court, petitioner filed a Motion for Reduction of Bond dated June 24,
1999 (which was received by the appellate court on June 28, 1999)
alleging financial constraints without showing “substantial compliance
with the Rules” or demonstrating a willingness to abide by the [R]ules
by posting a partial bond.” That petitioner questioned the computation
of the monetary award ─ basis of the computation of the amount of
appeal bond did not excuse it from posting a bond in a reasonable
amount or what it believed to be the correct amount. (THE HERITAGE
HOTEL MANILA v. NATIONAL LABOR RELATIONS COMMISSION, RUFINO
C. RAÑON II, AND ISMAEL C. VILLA, G.R. Nos. 180478-79, September
3, 2009)

• Certiorari

Respondent may have a point in asserting that in this case a

Rule 65 petition is a wrong mode of appeal, as indeed the writ of
certiorari is an extraordinary remedy, and certiorari jurisdiction is not
to be equated with appellate jurisdiction. Nevertheless, it is settled,
as a general proposition, that the availability of an appeal does not
foreclose recourse to the extraordinary remedies, such as certiorari
and prohibition, where appeal is not adequate or equally beneficial,
speedy and sufficient, as where the orders of the trial court were
issued in excess of or without jurisdiction, or there is need to promptly
relieve the aggrieved party from the injurious effects of the acts of an
inferior court or tribunal, e.g., the court has authorized execution of the
judgment. This Court has even recognized that a recourse to
certiorari is proper not only where there is a clear deprivation of
petitioner’s fundamental right to due process, but so also where other
special circumstances warrant immediate and more direct action.
(PEOPLE’S BROADCASTING(BOMBO RADYO PHILS., INC.) vs. THE
SECRETARY OF THE DEPARTMENT OF LABOR AND EMPLOYMENT, THE
REGIONAL DIRECTOR, DOLE REGION VII, and JANDELEON JUEZAN, G.R.
No. 179652, May 8, 2009)

• Strict Application of the Rules

2
 As to the other ground cited by private respondents’ counsel,
suffice it to say that it was a bare allegation unsubstantiated by any
proof or affidavit of merit. Besides, they could have filed the petition on
time with a motion to be allowed to litigate in forma pauperis. While
social justice requires that the law look tenderly on the disadvantaged
sectors of society, neither the rich nor the poor has a license to
disregard rules of procedure. The fundamental rule of human relations
enjoins everyone, regardless of standing in life, to duly observe
procedural rules as an aspect of acting with justice, giving everyone his
due and observing honesty and good faith. For indeed, while
technicalities should not unduly hamper our quest for justice, orderly
procedure is essential to the success of that quest to which all courts
are devoted. (LAGUNA METTS CORPORATION v. ARIES C. CAALAM and
GERALDINE ESGUERRA, G.R. No. 185220, July 27, 2009)

• Date of Filing

In this case, petitioner availed of the services of LBC, a private

carrier, to deliver its notice of appeal to the NLRC. Had petitioner sent
its notice of appeal by registered mail, the date of mailing would have
been deemed the date of filing with the NLRC. But petitioner, for
reasons of its own, chose to send its notice of appeal through a private
letter-forwarding agency. Therefore, the date of actual receipt by the
NLRC of the notice of appeal, and not the date of delivery to LBC, is
deemed to be the date of the filing of the notice of appeal. Since the
NLRC received petitioner’s notice of appeal on 26 February 2001, the
appeal was clearly filed out of time. Petitioner had thus lost its right to
appeal from the decision of the Labor Arbiter and the NLRC should
have dismissed its notice of appeal. (CHARTER CHEMICAL AND
COATING CORPORATION vs. HERBERT TAN and AMALIA SONSING, G.R.
No. 163891, May 21, 2009)

• Delayed Filing
We agree with the Court of Appeals that since no intent to delay
the administration of justice could be attributed to Guinmapang, a one
day delay does not justify the appeal’s denial. More importantly, the
Court of Appeals declared that Guinmapang’s appeal, on its face,
appears to be impressed with merit. The constitutional mandate to
accord full protection to labor and to safeguard the employee’s means
of livelihood should be given proper attention and sanction. A greater
injustice may occur if said appeal is not given due course than if the
reglementary period to appeal were strictly followed. In this case, we
are inclined to excuse the one day delay in order to fully settle the
merits of the case. This is in line with our policy to encourage full

3
adjudication of the merits of an appeal. (REPUBLIC CEMENT
CORPORATION v. PETER I. GUINMAPANG, G.R. No. 168910, August 24,
2009)

• Appeal Bond

At the time of the filing of the surety bond by PJI on January 2,

2003, PPAC was still an accredited bonding company. Thus, it was
but proper to honor the appeal bond issued by a bonding company
duly accredited by this Court at the time of its issuance. The
subsequent revocation of the authority of a bonding company
should not prejudice parties who relied on its authority. The
revocation of authority of a bonding company is prospective in
application. (CESARIO L. DEL ROSARIO v. PHILIPPINE JOURNALISTS,
INC., G.R. No. 181516, August 19, 2009)

While the bond may be reduced upon motion by the employer,

this is subject to the conditions that (1) the motion to reduce the bond
shall be based on meritorious grounds; and (2) a reasonable
amount in relation to the monetary award is posted by the appellant,
otherwise the filing of the motion to reduce bond shall not stop the
running of the period to perfect an appeal. The qualification effectively
requires that unless the NLRC grants the reduction of the cash bond
within the 10 day reglementary period, the employer is still
expected to post the cash or surety bond securing the full
amount within the said 10-day period. If the NLRC does
eventually grant the motion for reduction after the reglementary
period has elapsed, the correct relief would be to reduce the cash or
surety bond already posted by the employer within the 10-day period.
(ANDREW JAMES MCBURNIE v. EULALIO GANZON, EGI-MANAGERS,INC.
and E. GANZON, INC. G.R. Nos. 178034 & 178117, G.R. Nos. 186984-
85, September 18, 2009)

In addition, while the bond requirement on appeals involving a

monetary award has been relaxed in certain cases, this can only be
done where there was substantial compliance with the Rules; or where
the appellants, at the very least, exhibited willingness to pay by
posting a partial bond. ( LOLITA A. LOPEZ, ET. al., vs. QUEZON CITY
SPORTS CLUB, INC.,G.R. No. 164032, January 19, 2009)

The decisions, awards or orders of the Labor Arbiter are final and
executory unless appealed to the NLRC by any parties within ten (10)
calendar days from receipt thereof, with proof of payment of the
required appeal fee accompanied by a memorandum of appeal. And
where, as here, the judgment involves monetary award, an appeal

4
therefrom by the employer may be “perfected only upon the posting of
a cash or surety bond.” A mere notice of appeal without complying
with the other requisites mentioned does not stop the running of the
period for perfecting an appeal as in fact no motion for extension of
said period is allowed. (WALLEM MARITIME SERVICES, INC. and
SCANDIC SHIPMANAGEMENT LIMITED v. ERIBERTO S. BULTRON, G.R.
No. 185261, October 2, 2009)

The purpose of an appeal bond is to ensure, during the period of

appeal, against any occurrence that would defeat or diminish recovery
by the aggrieved employees under the judgment if subsequently
affirmed. The Deed of Assignment in the instant case, like a cash or
surety bond, serves the same purpose. First, the Deed of Assignment
constitutes not just a partial amount, but rather the entire award in the
appealed Order. Second, it is clear from the Deed of Assignment that
the entire amount is under the full control of the bank, and not of
petitioner, and is in fact payable to the DOLE Regional Office, to be
withdrawn by the same office after it had issued a writ of execution.
For all intents and purposes, the Deed of Assignment in tandem with
the Letter Agreement and Cash Voucher is as good as cash. Third, the
Court finds that the execution of the Deed of Assignment, the Letter
Agreement and the Cash Voucher were made in good faith, and
constituted clear manifestation of petitioner’s willingness to pay the
judgment amount. (PEOPLE’S BROADCASTING(BOMBO RADYO PHILS.,
INC.) vs. THE SECRETARY OF THE DEPARTMENT OF LABOR AND
EMPLOYMENT, THE REGIONAL DIRECTOR, DOLE REGION VII, and
JANDELEON JUEZAN, G.R. No. 179652, May 8, 2009)

Attorney’s Fees

Finally, the Court overrules the deletion by the NLRC of the Labor
Arbiter’s award for attorney’s fees to petitioner. Petitioner is evidently
entitled to attorney’s fees, since h3e was compelled to litigate to
protect his interest by reason of unjustified and unlawful termination of
his employment by respondents CCBP and Taguibao. (ERWIN H. REYES
v. NATIONAL LABOR RELATIONS COMMISSION, G.R. No. 180551,
February 10, 2009)

Considering that Atty. Go successfully represented his client, it is

only proper that he should receive adequate compensation for his
efforts. Even as we agree with the reduction of the award of attorney's
fees by the CA, the fact that a lawyer plays a vital role in the
administration of justice emphasizes the need to secure to him his
honorarium lawfully earned as a means to preserve the decorum and
respectability of the legal profession. A lawyer is as much entitled to
judicial protection against injustice or imposition of fraud on the part of

5
his client as the client is against abuse on the part of his counsel. The
duty of the court is not alone to ensure that a lawyer acts in a proper
and lawful manner, but also to see that a lawyer is paid his just fees.
With his capital consisting of his brains and with his skill acquired at
tremendous cost not only in money but in expenditure of time and
energy, he is entitled to the protection of any judicial tribunal against
any attempt on the part of his client to escape payment of his just
compensation. It would be ironic if after putting forth the best in him to
secure justice for his client, he himself would not get his due.
(EVANGELINA MASMUD (as substitute complainant for ALEXANDER J.
MASMUD) v. NATIONAL LABOR RELATIONS COMMISSION, G.R. No.
183385, February 13, 2009)

Moreover, in cases for recovery of wages, the award of attorney's

fees is proper and there need not be any showing that the employer
acted maliciously or in bad faith when it withheld the wages. There
need only be a showing that the lawful wages were not paid
accordingly. (BARON REPUBLIC THEATRICAL V. NORMITA P. PERALTA et
al, G.R. No. 170525, October 2, 2009)

In the case at bar, we find that the flight attendants were

represented by respondent union which, in turn, engaged the services
of its own counsel. The flight attendants had a common cause of
action. While the work performed by respondent’s counsel was by no
means simple, seeing as it spanned the whole litigation from the Labor
Arbiter stage all the way to this Court, nevertheless, the issues
involved in this case are simple, and the legal strategies, theories and
arguments advanced were common for all the affected crew members.
Hence, it may not be reasonable to award said counsel an amount
equivalent to 10% of all monetary awards to be received by each
individual flight attendant. Based on the length of time that this case
has been litigated, however, we find that the amount of P2,000,000.00
is reasonable as attorney’s fees. This amount should include all
expenses of litigation that were incurred by respondent union. (FLIGHT
ATTENDANTS AND STEWARDS ASSOCIATION OF THE PHILIPPINES
(FASAP), v. PHILIPPINE AIRLINES, INC.,PATRIA CHIONG and COURT OF
APPEALS,G.R. No. 178083, October 2, 2009)

The claim for attorney’s fees is granted following Article 2208 of

the New Civil Code which allows its recovery in actions for recovery of
wages of laborers and actions for indemnity under the employer's
liability laws. The same fees are also recoverable when the
defendant's act or omission has compelled the plaintiff to incur
expenses to protect his interest as in the present case following the
refusal by respondent to settle his claims. Pursuant to prevailing
jurisprudence, petitioner is entitled to attorney’s fees of ten percent

6
(10%) of the monetary award. (LEOPOLDO ABANTE v. KJGS FLEET
MANAGEMENT MANILA G.R. No. 182430, December 4, 2009)

Backwages

One of the natural consequences of a finding that an employee

has been illegally dismissed is the payment of backwages
corresponding to the period from his dismissal up to actual
reinstatement. The statutory intent of this matter is clearly
discernible. The payment of backwages allows the employee to
recover from the employer that which he has lost by way of wages as a
result of his dismissal. Logically, it must be computed from the date of
petitioner’s illegal dismissal up to the time of actual reinstatement.
There can be no gap or interruption, lest we defeat the very reason of
the law in granting the same. That petitioner did not immediately file
his Complaint should not affect or diminish his right to backwages, for
it is a right clearly granted to him by law -- should he be found to have
been illegally dismissed -- and for as long as his cause of action has not
been barred by prescription. (ERWIN H. REYES v. NATIONAL LABOR
RELATIONS COMMISSION, G.R. No. 180551, February 10, 2009)
He never bothered to redeem his license at the soonest possible
time when there was no showing that he was unlawfully prevented by
respondent from doing so. Thus, petitioner should not be paid for the
time he was not working. The Court has held that where the failure of
employees to work was not due to the employer's fault, the burden of
economic loss suffered by the employees should not be shifted to the
employer. Each party must bear his own loss. It would be unfair to
allow petitioner to recover something he has not earned and could not
have earned, since he could not discharge his work as a driver without
his driver's license. Respondent should be exempted from the burden
of paying backwages. (BERNARDINO V. NAVARRO v. P.V. PAJARILLO
LINER, INC., G.R. No. 164681, April 24, 2009)

Burden of Proof

In termination cases, the employer bears the burden of proving

that the dismissal of the employee is for a just or an authorized cause.
Failure to dispose of the burden would imply that the dismissal is not
lawful, and that the employee is entitled to reinstatement, back wages
and accruing benefits. Moreover, dismissed employees are not
required to prove their innocence of the employer’s accusations
against them. (SAN MIGUEL CORPORATION vs. NATIONAL LABOR
RELATIONS COMMISSION AND WILLIAM L. FRIEND, JR., G.R. No.
153983, May 26, 2009)

7
 As a general rule, one who pleads payment has the burden of
proving it. Even where the employee must allege nonpayment, the
general rule is that the burden rests on the employer to prove
payment, rather than on the employee to prove nonpayment. The
reason for the rule is that the pertinent personnel files, payrolls,
records, remittances and other similar documents — which will show
that overtime, differentials, service incentive leave and other claims of
workers have been paid — are not in the possession of the employee
but in the custody and absolute control of the employer. Since in the
case at bar petitioner company has not shown any proof of payment of
the correct amount of salary, holiday pay and 13th month pay, we
affirm the award of Madriaga’s monetary claims. (MANTLE TRADING
SERVICES, INCORPORATED AND/OR BOBBY DEL ROSARIO v. NATIONAL
LABOR RELATIONS COMMISSION and PABLO S. MADRIAGA,G.R. No.
166705,July 28,2009)

Respecting the issue of illegal dismissal, the Court appreciates

no evidence that petitioner was dismissed. What it finds is that
petitioner unilaterally stopped reporting for work before filing a
complaint for illegal dismissal, based on his belief that Guillermo and
Bergonia had spread rumors that his transactions on behalf of BAYER
would no longer be honored as of April 30, 2002. This belief remains
just that – it is unsubstantiated. While in cases of illegal dismissal, the
employer bears the burden of proving that the dismissal is for a valid
or authorized cause, the employee must first establish by substantial
evidence the fact of dismissal. (RAMY GALLEGO v. BAYER
PHILIPPINES, INC., DANPIN GUILLERMO, PRODUCT IMAGE MARKETING,
INC., and EDGARDO BERGONIA, G.R. No. 179807, July 31, 2009)

The burden of proving the validity of retrenchment is on the

petitioner. Evidence does not sufficiently establish that petitioner had
incurred losses that would justify retrenchment to prevent further
losses. The Comparative Income Statement for the year 1996 and for
the months of February to June 1997 which petitioner submitted did
not conclusively show that petitioner had suffered financial losses. In
fact, records show that from January to July 1997, petitioner hired a
total of 114 new employees assigned in the petitioner's stores located
in the different places of the country. (EMCOR INCORPORATED v. MA.
LOURDES D. SIENES, G.R. No. 152101, September 8, 2009)

It is well-settled that in termination cases, the burden of proof

rests upon the employer to show that the dismissal was for a just and
valid cause and failure to discharge the same would mean that the
dismissal is not justified and therefore illegal. Hence, in arguing that
Sabulao abandoned his work, it is incumbent upon the petitioners to
prove: (1) that the employee failed to report for work or had been

8
absent without valid or justifiable reason; and (2) that there must have
been a clear intention to sever the employer-employee relationship as
manifested by some overt acts. Clearly, jurisprudence dictates that
the burden of proof to show that there was unjustified refusal to go
back to work rests on the employer. (TACLOBAN FAR EAST MARKETING
CORPORATION and FRANCISCO Y. ROMUALDEZ v. THE COURT OF
APPEALS, NATIONAL LABOR RELATIONS COMMISSION, G.R. No. 182320,
September 11, 2009)

Cause of Action

The Secretary of Labor and Employment dismissed the first

petition as it was filed outside the 60-day freedom period. At that time
therefore, the union has no cause of action since they are not yet
legally allowed to challenge openly and formally the status of SMCGC-
SUPER as the exclusive bargaining representative of the bargaining
unit. Such dismissal, however, has no bearing in the instant case since
the third petition for certification election was filed well within the 60-
day freedom period. Otherwise stated, there is no identity of causes of
action to speak of since in the first petition, the union has no cause of
action while in the third, a cause of action already exists for the union
as they are now legally allowed to challenge the status of SMCGC-
SUPER as exclusive bargaining representative. (CHRIS GARMENTS
CORPORATION vs HON. PATRICIA A. STO. TOMAS and CHRIS
GARMENTS WORKERS UNION-PTGWO LOCAL CHAPTER No. 832, G.R.
No. 167426, January 12, 2009)
Circumvention of the Law

Notably, private respondent’s purported employment with

MANRED commenced only in 1996, way after she was hired by the
petitioner as extra beverage attendant on April 24, 1995. There is thus
much credence in the private respondent’s claim that the service
agreement executed between the petitioner and MANRED is a mere
ploy to circumvent the law on employment, in particular that which
pertains on regularization. (MARANAW HOTELS AND RESORT CORP vs
COURT OF APPEALS, SHERYL OABEL AND MANILA RESOURCE
DEVELOPMENT CORP., G.R. No. 149660, January 20, 2009)

Collective Bargaining Agreement (CBA)

If the terms of a CBA are clear and have no doubt upon the
intention of the contracting parties, as in the herein questioned
provision, the literal meaning thereof shall prevail. That is settled. As
such, the daily-paid employees must be paid their regular salaries on

9
the holidays which are so declared by the national government,
regardless of whether they fall on rest days.

Holiday pay is a legislated benefit enacted as part of the

Constitutional imperative that the State shall afford protection to labor.
Its purpose is not merely “to prevent diminution of the monthly income
of the workers on account of work interruptions. In other words,
although the worker is forced to take a rest, he earns what he should
earn, that is, his holiday pay.” (Emphasis and underscoring supplied)
(RFM CORPORATION-FLOUR DIVISION and SFI FEEDS DIVISION v.
KASAPIAN NG MANGGA-GAWANG PINAGKAISA-RFM (KAMPI-NAFLU-
KMU) and SANDIGAN AT UGNAYAN NG MANGGAGAWANG PINAGKAISA-
SFI (SUMAPI-NAFLU-KMU), G.R. No. 162324, February 4, 2009)

Company Policy

As respondents creditably explained, and as admitted by

petitioner herself, respondents have standing policies that an
employee must be single at the time of employment and must be
willing to be assigned to any of its branches in the country.
Petitioner’s contention that upon getting married, she no longer bound
herself to be assigned to any of respondents’ branches in the country
is preposterous. Just because an employee gets married does not
mean she can already renege on a commitment she willingly made at
the time of her employment particularly if such commitment does not
appear to be unreasonable, inconvenient, or prejudicial to her.
Respondents claimed that travel time from the Bacolod City Branch to
the Iloilo City Branch will only take about an hour by boat and that they
were even willing to defray petitioner’s transportation and lodging
expenses. Petitioner never disputed these matters. There is no
showing either that petitioner’s transfer was only being used by
respondents to camouflage a sinister scheme of management to rid
itself of an undesirable worker in the person of petitioner. (AILEEN G.
HERIDA v. F & C PAWNSHOP and JEWELRY STORE/MARCELINO
FLORETE, JR., G.R. No. 172601, April 16, 2009)

Computation of Award
Finally, on the increase in the computation of the monetary
award to respondents, the decision of the Labor Arbiter specified that
for purposes of putting up a bond should petitioner appeal, the
backwages were computed only for a certain period. Otherwise, the
actual backwages to be paid to respondents are computed from the
date of dismissal until the finality of the decision. In addition, because
petitioner continues to refuse and accord regular status to respondents
and to pay them their corresponding wages even after the lapse of two

10
(2) years from the finality of the Labor Arbiter’s decision, the Labor
Arbiter correctly included that in its order of execution. Thus, the Labor
Arbiter’s order of execution simply covered the correct computation of
wages and other payments enjoyed by petitioner’s regular employees.
(PHILIPPINE LONG DISTANCE TELEPHONE COMPANY v. RIZALINA RAUT,
LEILA EMNACE and GINA CAPISTRANO, G.R. No. 174209, August 25,
2009)

This Court notes that the NLRC awarded backwages, 13 th month

pay, and service incentive leave pay from July 10, 2005 to January 23,
2007 only. It is evident that these should not be limited to said period.
These should be computed from the date of her illegal dismissal until
this decision attains finality. Though Bolanos did not appeal the
computation of the NLRC’s award as affirmed by the Court of Appeals,
we are not barred from ordering its modification. This Court is imbued
with sufficient authority and discretion to review matters, not
otherwise assigned as errors on appeal, if it finds that their
consideration is necessary in arriving at a complete and just resolution
of the case or to serve the interests of justice or to avoid dispensing
piecemeal justice. Besides, substantive rights like the award of
backwages, 13th month pay and service incentive leave pay resulting
from illegal dismissal must not be prejudiced by a rigid and technical
application of the rules. The computation of the award for backwages
and other benefits from the time the compensation was withheld up to
the time of actual reinstatement is a mere legal consequence of the
finding that respondent was illegally dismissed by petitioners. (HENLIN
PANAY COMPANY v. NATIONAL LABOR RELATIONS COMMISSION , G.R.
No. 180718, October 23, 2009)

Conclusiveness of Judgment

Third. The matter of employer-employee relationship has been

resolved with finality by the Secretary of Labor and Employment in the
Resolution dated December 27, 2002. Since petitioner did not appeal
this factual finding, then, it may be considered as the final resolution of
such issue. To reiterate, “conclusiveness of judgment” has the effect
of preclusion of issues. (CHRIS GARMENTS CORPORATION vs HON.
PATRICIA A. STO. TOMAS and CHRIS GARMENTS WORKERS UNION-
PTGWO LOCAL CHAPTER No. 832, G.R. No. 167426, January 12, 2009)

Contingent Fee

Contingent fee contracts are subject to the supervision and close

scrutiny of the court in order that clients may be protected from
unjust charges. The amount of contingent fees agreed upon by the
parties is subject to the stipulation that counsel will be paid for his

11
 legal services only if the suit or litigation prospers. A much higher
compensation is allowed as contingent fees because of the risk that
the lawyer may get nothing if the suit fails. The Court finds nothing
illegal in the contingent fee contract between Atty. Go and
Evangelina’s husband. The CA committed no error of law when it
awarded the attorney’s fees of Atty. Go and allowed him to receive
an equivalent of 39% of the monetary award. (EVANGELINA
MASMUD (as substitute complainant for ALEXANDER J. MASMUD) v.
NATIONAL LABOR RELATIONS COMMISSION, G.R. No. 183385,
February 13, 2009)

Contract of Adhesion

In addition, the employment agreement may be likened into a

contract of adhesion considering that it is petitioner who insists that
there existed an express period of one year from April 1, 2002 to
March 31, 2003, using as proof its own copy of the agreement. While
contracts of adhesion are valid and binding, in cases of doubt which
will cause a great imbalance of rights against one of the parties, the
contract shall be construed against the party who drafted the same.
Hence, in this case, where the very employment of respondent is at
stake, the doubt as to the period of employment must be construed in
her favor. (MAGIS YOUNG ACHIEVERS’ LEARNING CENTER and MRS.
VIOLETA T. CARIÑO v. ADELAIDA . MANALO, G.R. No. 178835, February
13, 2009)

Contract of Employment

Since respondent was already a regular employee months before

the execution of the Employment with a Fixed Period contract, its
execution was merely a ploy on SMC’s part to deprive respondent of
his tenurial security. Hence, no valid fixed-term contract was executed.
The employment status of a person is defined and prescribed by law
and not by what the parties say it should be. Equally important to
consider is that a contract of employment is impressed with public
interest such that labor contracts must yield to the common good.
Provisions of applicable statutes are deemed written into the contract,
and the parties are not at liberty to insulate themselves and their
relationships from the impact of labor laws and regulations by simply
contracting with each other. (SAN MIGUEL CORPORATION v. EDUARDO
L. TEODOSIO, G.R. No. 163033, October 2, 2009)

Corporate Rehabilitation

Given these premises, it is not difficult to understand why

actions for claims against the ailing enterprise have to be suspended.

12
It then becomes easy to accept the hypothesis that the date when the
claim arose, or when the action is filed, is of no moment. As long as the
corporation is under a management committee or a rehabilitation
receiver, all actions for claims against it --- for money or otherwise ---
must yield to the greater imperative of corporate rehabilitation,
excepting only, as already mentioned, claims for payment of
obligations incurred by the corporation in the ordinary course of
business. Enforcement of writs of execution issued by judicial or quasi-
judicial tribunals, since such writs emanate from “actions for claims,”
must, likewise, be suspended. (MALAYAN INSURANCE COMPANY, INC.
v. VICTORIAS MILLING COMPANY, INC., G.R. No. 167768, April 17, 2009)

Damages

Petitioner's reliance on Viernes v. National Labor Relations

Commission to support its claim for the reduction of the award of
nominal damages is misplaced. The factual circumstances are
different. Viernes is an illegal dismissal case, since there was no
authorized cause for the dismissal of the employees; and the employer
was ordered to pay backwages inclusive of allowances and other
benefits, computed from the time the compensation was withheld up
to the actual reinstatement. In addition, since the dismissal was done
without due process, the nominal damages awarded was only
P2,590.00 equivalent to one-month salary of the employee. In this
case, the dismissal was valid, as it was due to an authorized cause, but
without the observance of procedural due process, and the only award
given was nominal damages. (CELEBES JAPAN FOODS CORPORATION
V. SUSAN YERMO G.R. No. 175855 October 2, 2009)

In previous cases where moral damages and attorney’s fees

were awarded, the manner of termination was done in a humiliating
and insulting manner, such as in the case of Balayan Colleges v.
National Labor Relations Commission where the employer posted
copies of its letters of termination to the teachers inside the school
campus and it also furnished copies to the town mayor and Parish
Priest of their community for the purpose of maligning the teachers’
reputation. So also in the case of Chiang Kai Shek School v. Court
of Appeals, this Court awarded moral damages to a teacher who was
flatly, and without warning or a formal notice, told that she was
dismissed. (M+W ZANDER PHILIPPINES, INC. and ROLF WILTSCHEK v.
TRINIDAD M. ENRIQUEZ, G.R. No. 169173, June 5, 2009)

Disability Benefits

Under paragraph 20.1.5 of the parties’ CBA, it is stipulated that

“[a] seafarer whose disability is assessed at 50% or more under the

13
POEA Employment Contract shall x x x be regarded as permanently
unfit for further sea service in any capacity and entitled to 100%
compensation, i.e., x x x US$60,000.00 for ratings.” Petitioner’s
disability rating being 68.66%, he is entitled to a 100% disability
compensation of US$60,000, as correctly found by the Labor Arbiter
and the NLRC. So Philimare, Inc./Marlow Navigation Co., Ltd. v.
Suganob, enlightens, thus:

Apropos the appropriate disability benefits that

respondent is entitled to, we find that Suganob is entitled
to Grade 1 disability benefits which corresponds to total
and permanent disability. . .
x x x To be entitled to Grade 1 disability
benefits, the employee’s disability must not only be
total but also permanent.

Permanent disability is the inability of a worker

to perform his job for more than 120 days,
regardless of whether or not he loses the use of any
of his body. Clearly, Suganob’s disability is permanent
since he was unable to work from the time he was
medically repatriated on September 17, 2001 up to the
time the complaint was filed on April 25, 2002, or more
than 7 months. Moreover, if in fact Suganob is clear and fit
to work on October 29, 2001, he would have been taken
back by petitioners to continue his work as a Chief Cook,
but he was not. His disability is undoubtedly
permanent.

Total disability, on the other hand, does not

mean absolute helplessness. In disability
compensation, it is not the injury which is compensated,
but rather the incapacity to work resulting in the
impairment of one’s earning capacity. Total disability does
not require that the employee be absolutely disabled, or
totally paralyzed. What is necessary is that the injury
must be such that the employee cannot pursue his
usual work and earn therefrom. Both the company-
designated physician and Suganob’s physician found that
Suganob is unfit to continue his duties as a Chief
Cook since his illness prevented him from continuing
his duties as such. Due to his illness, he can no longer
perform work which is part of his daily routine as Chief
Cook like lifting heavy loads of frozen meat, fish, water,
etc. when preparing meals for the crew members. Hence,
Suganob’s disability is also total. (Emphasis supplied)

14
 (JOELSON O. ILORETA v. PHILIPPINE TRANSMARINE
CARRIERS, INC., G.R. NO. 183908, December 4, 2009)

As with all other kinds of worker, the terms and conditions of a

seafarer’s employment is governed by the provisions of the contract
he signs at the time he is hired. But unlike that of others, deemed
written in the seafarer’s contract is a set of standard provisions set and
implemented by the POEA, called the Standard Terms and Conditions
Governing the Employment of Filipino Seafarers on Board Ocean-Going
Vessels, which are considered to be the minimum requirements
acceptable to the government for the employment of Filipino seafarers
on board foreign ocean-going vessels. Thus, the issue of whether
petitioner Nisda can legally demand and claim disability benefits from
respondents Sea Serve and ADAMS for an illness suffered is best
addressed by the provisions of his POEA-SEC, which incorporated the
Standard Terms and Conditions Governing the Employment of Filipino
Seafarers on Board Ocean-Going Vessels. When petitioner Nisda was
employed on 7 August 2001, it was the 2000 Amended Standard
Terms and Conditions Governing the Employment of Filipino Seafarers
on Board Ocean-Going Vessels (hereinafter referred to simply as
Amended Standard Terms and Conditions for brevity) that applied and
were deemed written in or appended to his POEA-SEC. (CARLOS N.
NISDA v. SEA SERVE MARITIME AGENCY and KHALIFA A. ALGOSAIBI
DIVING AND MARINE SERVICES, G. R. No. 179177, July 23, 2009)

Given a seafarer’s entitlement to permanent disability benefits

when he is unable to work for more than 120 days, the failure of the
company-designated physician to pronounce petitioner fit to work
within the 120-day period entitles him to permanent total disability
benefit in the amount of US$60,000.00. (LEOPOLDO ABANTE v. KJGS
FLEET MANAGEMENT MANILA G.R. No. 182430, December 4, 2009)

Dismissal

In the present case, we significantly note that petitioner, after

filing her explanation in response to the employer’s July 1, 1997 memo,
never asked for any clarificatory hearing during the plant-level
proceedings. She also had ample opportunity to explain her side vis-à-
vis the principal charge against her — her involvement in the incident
of June 30, 1997 . It is a matter of record that the petitioner lost no
time in submitting the required explanation, as she submitted it on the
very same day that the memo was served on her. The explanation, in
Filipino, narrated among others the indifferent and discriminatory
treatment she had been receiving from the group of Nilo Echavez,
which she also told her husband who got mad. Taken together with
the testimonies of other witnesses who gave their statements on how

15
the petitioner encouraged her husband to attack Echavez (all of which
were duly and seasonably disclosed), the petitioner cannot claim that
the respondent company did not give her ample opportunity to be
heard. All told, we are convinced that the respondent company acted
based on a valid cause for dismissal and observed the required
procedures in so acting. (ROSARIO A. GATUS v. QUALITY HOUSE, INC.
and CHRISTOPHER CHUA, G.R. No. 156766, April 16, 2009)

• Constructive Dismissal

Case law holds that constructive dismissal occurs when there is

cessation of work because continued employment is rendered
impossible, unreasonable or unlikely; when there is a demotion in rank
or diminution in pay or both; or when a clear discrimination,
insensibility, or disdain by an employer becomes unbearable to the
employee. Respondent’s sudden, arbitrary and unfounded adoption of
the two-day work scheme which greatly reduced petitioners’ salaries
renders it liable for constructive dismissal. (FE LA ROSA et. al., v.
AMBASSADOR HOTEL,G.R. No. 177059, March 13, 2009)

What thus surfaces is that petitioner was constructively dismissed. No

actual dismissal might have occurred in the sense that petitioner was
not served with a notice of termination, but there was constructive
dismissal, petitioner having been placed in a position where continued
employment was rendered impossible and unreasonable by the
circumstances indicated above. (ODILON L. MARTINEZ v. B&B FISH
BROKER/NORBERTO M. LUCINARIO, G.R. No. 179985, September 18,
2009)

Time and again we have ruled that in constructive dismissal

cases, the employer has the burden of proving that the transfer of an
employee is for just and valid grounds, such as genuine business
necessity. The employer must demonstrate that the transfer is not
unreasonable, inconvenient, or prejudicial to the employee and that
the transfer does not involve a demotion in rank or a diminution of
salary and other benefits. If the employer fails to overcome this burden
of proof, the employee’s transfer is tantamount to unlawful
constructive dismissal. (MERCK SHARP AND DOHME (PHILIPPINES) v.
JONAR P. ROBLES, et al., G.R. No. 176506, November 25, 2009)

These discriminatory acts were calculated to make petitioner feel

that he is no longer welcome nor needed in respondent company −
short of sending him an actual notice of termination. We, therefore,
hold that respondent constructively dismissed petitioner from the
service. (RAMON B. FORMANTES v. DUNCAN PHARMACEUTICALS,
PHILS., INC., G.R. No. 170661, December 4, 2009)

16
 In the present case, the petitioners ceased verbally
communicating with the respondent and giving him work assignment
after suspecting that he had forged purchase receipts. Under this
situation, the respondent was forced to leave the petitioners’
compound with his family and to transfer to a nearby place. Thus, the
respondent’s act of leaving the petitioners’ premises was in reality not
his choice but a situation the petitioners created. (CRC AGRICULTURAL
TRADING and ROLANDO B. CATINDIG v. NATIONAL LABOR RELATIONS
COMMISSION, G.R. No. 177664, December 23, 2009)

• Dismissal of Managerial Employees

In view of the lack of proper investigation into the charges

against respondent, petitioners failed to show that they have a just
cause for terminating his employment. Respondents’ alleged
infractions amount to nothing more than bare accusations and
unilateral conclusions that do not provide legal justification for his
termination from employment. Although petitioners have wider
latitude of discretion in terminating respondent, who was a managerial
employee, it is nonetheless settled that confidential and managerial
employees cannot be arbitrarily dismissed at any time, and without
cause as reasonably established in an appropriate investigation. Such
employees, too, are entitled to security of tenure, fair standards of
employment and the protection of labor laws. Managerial employees,
no less than rank-and-file laborers are entitled to due process. (CASA
CEBUANA INCORPORADA and ANGELA FIGUEROA PAULIN v. IRENEO P.
LEUTERIO, G.R. No. 176040, September 4, 2009)

• Dismissal due to Union Security Clauses

Nonetheless, while We uphold dismissal pursuant to a union

security clause, the same is not without a condition or restriction. For
to allow its untrammeled enforcement would encourage arbitrary
dismissal and abuse by the employer, to the detriment of the
employees. Thus, to safeguard the rights of the employees, We have
said time and again that dismissals pursuant to union security clauses
are valid and legal, subject only to the requirement of due process,
that is, notice and hearing prior to dismissal. In like manner, We
emphasized that the enforcement of union security clauses is
authorized by law, provided such enforcement is not characterized by
arbitrariness, and always with due process. (Herminigildo Inguillo and
Zenaida Bergante v. First Philippine Scales, Inc. and/or Amparo
Policarpio, Manager, G.R. No. 165407, June 5, 2009)

• Dismissal of Union Officer

17
 Note that the verb “participates” is preceded by the adverb
“knowingly.” This reflects the intent of the legislature to require
“knowledge” as a condition sine qua non before a union officer can be
dismissed from employment for participating in an illegal strike. The
provision is worded in such a way as to make it very difficult for
employers to circumvent the law by arbitrarily dismissing employees in
the guise of exercising management prerogative. This is but one
aspect of the State’s constitutional and statutory mandate to protect
the rights of employees to self-organization. (CLUB FILIPINO, INC.
and ATTY. ROBERTO F. DE LEON v. benjamin bautista, et. al., G.R. No.
168406, July 13, 2009)

• Illegal Dismissal

With the finding that Interserve was engaged in prohibited labor-

only contracting, petitioner shall be deemed the true employer of
respondents. As regular employees of petitioner, respondents cannot
be dismissed except for just or authorized causes, none of which were
alleged or proven to exist in this case, the only defense of petitioner
against the charge of illegal dismissal being that respondents were not
its employees. Records also failed to show that petitioner afforded
respondents the twin requirements of procedural due process, i.e.,
notice and hearing, prior to their dismissal. Respondents were not
served notices informing them of the particular acts for which their
dismissal was sought. Nor were they required to give their side
regarding the charges made against them. Certainly, the respondents’
dismissal was not carried out in accordance with law and, therefore,
illegal. (COCA-COLA BOTTLERS PHILS., INC v. ALAN M. AGITO, et al.,
G.R. No. 179546, February 13, 2009)

As the employer, petitioner has the burden of proving that the

dismissal of petitioner was for a cause allowed under the law and that
petitioner was afforded procedural due process. Petitioner failed to
discharge this burden. Indeed, it failed to show any valid or authorized
cause under the Labor Code which allowed it to terminate the services
of individual respondents. Neither did petitioner show that individual
respondents were given ample opportunity to contest the legality of
their dismissal. No notice of such impending termination was ever
given to them. Individual respondents were definitely denied due
process. Having failed to establish compliance with the requirements
on termination of employment under the Labor Code, the dismissal of
individual respondents was tainted with illegality. (ILIGAN CEMENT
CORPORATION v. ILIASCOR EMPLOYEES AND WORKERS UNION –
SOUTHERN PHILIPPINES FEDERATION OF LABOR (IEWU-SPFL), AND ITS
OFFICERS AND MEMBERS, et. al, G.R. No. 158956, April 24, 2009)

18
 In this case, we find no overt act on the part of petitioner that he
was ready to sever his employment ties. The alleged resignation was
actually premised by respondents only on the filing of the complaint for
separation pay, but this alone is not sufficient proof that petitioner
intended to resign from the company. What strongly negates the claim
of resignation is the fact that petitioner filed the amended complaint
for illegal dismissal immediately after he was not allowed to report for
work on June 3, 2000. Resignation is inconsistent with the filing of the
complaint for illegal dismissal. It would have been illogical for
petitioner to resign and then file a complaint for illegal dismissal later
on. If petitioner was determined to resign, as respondents posited, he
would not have commenced the action for illegal dismissal.
Undeniably, petitioner was unceremoniously dismissed in this case.
(BALTAZAR L. PAYNO v. ORIZON TRADING CORP. / ORATA TRADING
and FLORDELIZA LEGASPI, G.R. No. 175345, August 19, 2009)

Therefore, this Court finds no reason to disturb its finding that

the retrenchment of the flight attendants was illegally executed. As
held in the Decision sought to be reconsidered, PAL failed to observe
the procedure and requirements for a valid retrenchment. Assuming
that PAL was indeed suffering financial losses, the requisite proof
therefor was not presented before the NLRC which was the proper
forum. More importantly, the manner of the retrenchment was not in
accordance with the procedure required by law. Hence, the
retrenchment of the flight attendants amounted to illegal dismissal.
Consequently, the flight attendants affected are entitled to the reliefs
provided by law, which include backwages and reinstatement or
separation pay, as the case may be. (FLIGHT ATTENDANTS AND
STEWARDS ASSOCIATION OF THE PHILIPPINES (FASAP), v. PHILIPPINE
AIRLINES, INC.,PATRIA CHIONG and COURT OF APPEALS,G.R. No.
178083, October 2, 2009)

Clearly, Bolanos’s case is one of illegal dismissal. First, there is

no just or authorized cause for petitioners to terminate her
employment. Her alleged act of dishonesty of “passing out” food for
free was not proven. Neither was there incompetence on her part
when some food items were not punched in the cash register as she
was not the cashier manning it when the food items were ordered. In
fact, the other cashier even owned up to said mistake. Second,
Bolanos was not afforded due process by petitioners before she was
dismissed. A day after the incident, she was verbally dismissed from
her employment without being given the chance to be heard and
defend herself. (HENLIN PANAY COMPANY v. NATIONAL LABOR
RELATIONS COMMISSION , G.R. No. 180718, October 23, 2009)

19
 In fine, as petitioners failed to indubitably prove that
respondents were guilty of drug use in contravention of its drug-free
workplace policy amounting to serious misconduct, respondents are
deemed to have been illegally dismissed. (PLANTATION BAY RESORT
and SPA v. ROMEL S. DUBRICO, et al., G.R. No. 182216, December 4,
2009)

Docket Fees

Anent petitioner's claim regarding respondent's failure to pay the

full amount of docket fees at the time of the filing of the petition with
the CA, we find that it is estopped from questioning the jurisdiction of
the CA on this ground, because such issue had never been raised in
any of the pleadings filed before the CA. Notably, the CA issued a
minute resolution dated June 7, 1999 requiring respondent to remit the
amount of P510.00 to complete the docket and other fees.
Respondent complied, but due to inadvertence, the amount remitted
lacked the amount of P10.00, thus, the CA in a Resolution dated
November 22, 1999, considered the appeal abandoned pursuant to
Section 1(c), Rule 50 of the 1997 Rules of Court. Upon respondent's
motion for reconsideration, the appeal was reinstated on February 22,
2000. Petitioner was copy-furnished all the resolutions issued by the
CA, but petitioner never raised the issue of incomplete payment of
docket fees. In fact, such issue was only raised for the first time in its
Reply filed with us. (EMCOR INCORPORATED v. MA. LOURDES D.
SIENES, G.R. No. 152101, September 8, 2009)

Doctrine of Strained Relationship

To protect the employee’s security of tenure, the Court has

emphasized that the doctrine of “strained relations” should be strictly
applied so as not to deprive an illegally dismissed employee of his right
to reinstatement. Every labor dispute almost always results in
“strained relations,” and the phrase cannot be given an overarching
interpretation; otherwise, an unjustly dismissed employee can never
be reinstated. The assumption of strained relations was already
debunked by the fact that as early as March 2006 petitioner returned
to work for respondent CCBP, without any antagonism having been
reported thus far by any of the parties. Neither can we sustain the
NLRC’s conclusion that petitioner’s position is confidential in nature.
Receipt of proceeds from sales of respondent CCBP’s products does
not make petitioner a confidential employee. A confidential employee
is one who (1) assists or acts in a confidential capacity, in regard to (2)

20
persons who formulate, determine, and effectuate management
policies specifically in the field of labor relations. Verily, petitioner’s
job as a salesman does not fall under this qualification. (ERWIN H.
REYES v. NATIONAL LABOR RELATIONS COMMISSION, G.R. No. 180551,
February 10, 2009)

In the present case, reinstatement is no longer feasible because

of the strained relations between the petitioners and the respondent.
Time and again, this Court has recognized that strained relations
between the employer and employee is an exception to the rule
requiring actual reinstatement for illegally dismissed employees for the
practical reason that the already existing antagonism will only fester
and deteriorate, and will only worsen with possible adverse effects on
the parties, if we shall compel reinstatement; thus, the use of a viable
substitute that protects the interests of both parties while ensuring
that the law is respected. (CRC AGRICULTURAL TRADING and
ROLANDO B. CATINDIG v. NATIONAL LABOR RELATIONS COMMISSION,
G.R. No. 177664, December 23, 2009)

In conclusion, it bears to stress that it is human nature that some

hostility will inevitably arise between parties as a result of litigation,
but the same does not always constitute strained relations in the
absence of proof or explanation that such indeed exists. (REYNALDO
G. CABIGTING v. SAN MIGUEL FOODS, INC, G.R. No. 167706,
November 5, 2009)

Downsizing Scheme

This, in turn, gives rise to another question: Does the

implementation of the downsizing scheme preclude petitioner from
availing the services of contractual and agency-hired employees?

In Asian Alcohol Corporation v. National Labor Relations

Commission, we answered in the negative. We said:

In any event, we have held that an employer’s good faith in

implementing a redundancy program is not necessarily destroyed by
availment of the services of an independent contractor to replace the
services of the terminated employees. We have previously ruled that
the reduction of the number of workers in a company made necessary
by the introduction of the services of an independent contractor is
justified when the latter is undertaken in order to effectuate more
economic and efficient methods of production. In the case at bar,
private respondent failed to proffer any proof that the management
acted in a malicious or arbitrary manner in engaging the services of an
independent contractor to operate the Laura wells. Absent such proof,

21
the Court has no basis to interfere with the bona fide decision of
management to effect more economic and efficient methods of
production.

With petitioner’s downsizing scheme being valid, and the

availment of contractual and agency-hired employees legal, the strike
staged by officers and members of respondent Union is, perforce,
illegal. (HOTEL ENTERPRISES OF THE PHILIPPINES, INC. (HEPI), owner of
Hyatt Regency Manila, v. SAMAHAN NG MGA MANGGAGAWA SA HYATT-
NATIONAL UNION OF WORKERS IN THE HOTEL AND RESTAURANT AND
ALLIED INDUSTRIES (SAMASAH-NUWHRAIN), G.R. No. 165756, June 5,
2009)

Due Process

It is well settled that the basic requirement of notice and hearing in

termination cases is for the employer to inform the employee of the
specific charges against him and to hear his side and defenses.
This does not, however, mean a full adversarial proceeding. The
parties may be heard through pleadings, written explanations,
position papers, memorandum or oral argument. In all of these
instances, the employer plays an active role by providing the
employee with the opportunity to present his side and answer the
charges in substantial compliance with due process.( ROMEO N.
VENTURA, vs. COURT OF APPEALS, NATIONAL LABOR RELATIONS
COMMISSION, GENUINO ICE CO., INC., and HECTOR GENUINO, G.R.
No. 182570, January 27, 2009)

In the dismissal of employees, it has been consistently held that

the twin requirements of notice and hearing are essential elements
of due process. Article 277 (b) of the Labor Code and Section 2,
Rule XXIII, Book V of the Rules Implementing the Labor Code
require the employer to furnish the employee with two written
notices, to wit: (1) a written notice served on the employee
specifying the ground or grounds for termination, and giving to said
employee reasonable opportunity within which to explain his side;
and (2) a written notice of termination served on the employee
indicating that upon due consideration of all the circumstances,
grounds have been established to justify his termination. The first
notice which may be considered as the proper charge, serves to
apprise the employee of the particular acts or omissions for which
his dismissal is sought. The second notice on the other hand seeks
to inform the employee of the employer’s decision to dismiss him.
With regard to the requirement of a hearing, it should be stressed

22
 that the essence of due process lies simply in an opportunity to be
heard, and not that an actual hearing should always and
indispensably be held. (PHILIPPINE PASAY CHUNG HUA ACADEMY
and EMILIO CHING v. SERVANDO L. EDPAN, G.R. No. 168876,
SERVANDO L. EDPAN v. PHILIPPINE PASAY CHUNG HUA ACADEMY
and EMILIO CHING)

Nonetheless, Section 2(d), Rule I of the Implementing Rules of

Book VI of the Labor Code should not be taken to mean that holding an
actual hearing or conference is a condition sine qua non for compliance
with the due process requirement in termination of employment. The
test for the fair procedure guaranteed under Article 277(b) cannot be
whether there has been a formal pretermination confrontation between
the employer and the employee. The “ample opportunity to be heard”
standard is neither synonymous nor similar to a formal hearing. To
confine the employee’s right to be heard to a solitary form narrows
down that right. It deprives him of other equally effective forms of
adducing evidence in his defense. Certainly, such an exclusivist and
absolutist interpretation is overly restrictive. The “very nature of due
process negates any concept of inflexible procedures universally
applicable to every imaginable situation.” (FELIX B. PEREZ and
AMANTE G. DORIA vs. PHILIPPINE TELEGRAPH AND TELEPHONE
COMPANY and JOSE LUIS SANTIAGO, G.R. No. 152048, April 7, 2009)

Also, to effectively dismiss an employee for abandonment, the

employer must comply with the due process requirement of sending
notices to the employee. In Brahm Industries, Inc. v. NLRC, we ruled
that this requirement is not a mere formality that may be dispensed
with at will. Its disregard is a matter of serious concern since it
constitutes a safeguard of the highest order in response to man’s
innate sense of justice. Petitioner was not able to send the necessary
notice requirement to Eleonor. Petitioner’s belated claim that it was
not able to send the notice of infraction prior to the filing of the illegal
dismissal case cannot simply unacceptable. Based on the foregoing,
Eleonor did not abandon her work. (SOUTH DAVAO DEVELOPMENT
COMPANY, INC. (NOW SODACO AGRICULTURAL CORPORATION)
AND/OR MALONE PACQUIAO AND VICTOR A. CONSUNJI, v. SERGIO L.
GAMO, et. al., G.R. No. 171814, May 8, 2009)

The case of Agabon v. NLRC, et al. applies to the case at bar.

In Agabon, the dismissal was found by the Court to be based on a just
cause because the employee abandoned his work. But it also found
that the employer did not follow the notice requirement demanded by
due process. It ruled that this violation of due process on the part of
the employer did not nullify the dismissal, or render it illegal, or
ineffectual. Nonetheless, the employer was ordered to indemnify the

23
employee for the violation of his right to due process. It further held
that the penalty should be in the nature of indemnification, in the form
of nominal damages and should depend on the facts of each case,
taking into special consideration the gravity of the due process
violation of the employer. The amount of such damages is addressed
to the sound discretion of the court, considering the relevant
circumstances. Thus, in Agabon, the Court ordered the employer to
pay the employee nominal damages in the amount of P30,000.00.
(MANTLE TRADING SERVICES, INCORPORATED AND/OR BOBBY DEL
ROSARIO v. NATIONAL LABOR RELATIONS COMMISSION and PABLO S.
MADRIAGA,G.R. No. 166705,July 28,2009)

Had Metro’s cause for terminating Aman rested on a just or

authorized cause yet failed to observe procedural requirements, then
Metro will only be liable for nominal damages worth P30,000. However,
such is not the case here. We hold that Aman’s dismissal not only failed
to observe procedural requirements, it also lacked an authorized cause.
Article 279 of the Labor Code mandates that the employee who is illegally
dismissed and not given due process is entitled to reinstatement without
loss of seniority rights and other privileges and full backwages, inclusive of
allowances, and other benefits or their monetary equivalent computed
from the time the compensation was not paid up to the time of actual
reinstatement. (METRO CONSTRUCTION, INC. V. ROGELIO AMAN, G.R. No.
168324, October 12, 2009)

In the present case, Jose, Jr. was not given any written notice about
his dismissal. However, the propriety of Jose, Jr.’s dismissal is not affected
by the lack of written notices. When the dismissal is for just cause, the
lack of due process does not render the dismissal ineffectual but merely
gives rise to the payment of P30,000 in nominal damages. (BERNARDO B.
JOSE, JR. v. MICHAELMAR PHILS., INC., G.R. No. 169606, November 27,
2009)

In cases of abandonment of work, the ground alleged by

respondents, notice shall be served at the worker’s last known address.
Here, no such notice was served to petitioner. Hence, for breach of the
due process requirements, respondents shall also be liable in the
amount of P30,000 as indemnity in the form of nominal damages.
(CONCEPCION FAELDONIA v. TONG YAK GROCERIES,JAYME GO and
MERLITA GO,G.R. No. 182499, October 2, 2009)

The petitioners clearly failed to comply with the two-notice

requirement. Nothing in the records shows that the petitioners ever
sent the respondent a written notice informing him of the ground for
which his dismissal was sought. It does not also appear that the
petitioners held a hearing where the respondent was given the

24
opportunity to answer the charges of abandonment. Neither did the
petitioners send a written notice to the respondent informing the latter
that his service had been terminated and the reasons for the
termination of employment. Under these facts, the respondent’s
dismissal was illegal. (CRC AGRICULTURAL TRADING and ROLANDO B.
CATINDIG v. NATIONAL LABOR RELATIONS COMMISSION, G.R. No.
177664, December 23, 2009)

Employer-Employee Relationship

In order to determine the existence of an employer-employee

relationship, the Court has frequently applied the four-fold test: (1) the
selection and engagement of the employee; (2) the payment of wages;
(3) the power of dismissal; and (4) the power to control the employee’s
conduct, or the so called “control test,” which is considered the most
important element. From the time they were hired by petitioner
corporation up to the time that they were reassigned to work under
Gamo’s supervision, their status as petitioner corporation’s employees
did not cease. Likewise, payment of their wages was merely coursed
through Gamo. As to the most determinative test―the power of
control, it is sufficient that the power to control the manner of doing
the work exists, it does not require the actual exercise of such power.
In this case, it was in the exercise of its power of control when
petitioner corporation transferred the copra workers from their
previous assignments to work as copraceros. It was also in the
exercise of the same power that petitioner corporation put Gamo in
charge of the copra workers although under a different payment
scheme. Thus, it is clear that an employer-employee relationship has
existed between petitioner corporation and respondents since the
beginning and such relationship did not cease despite their
reassignments and the change of payment scheme. (SOUTH DAVAO
DEVELOPMENT COMPANY, INC. (NOW SODACO AGRICULTURAL
CORPORATION) AND/OR MALONE PACQUIAO AND VICTOR A. CONSUNJI,
v. SERGIO L. GAMO, et. al., G.R. No. 171814, May 8, 2009)

What is more, respondent PDMC enrolled petitioner Gomez with

the Social Security System, the Medicare, and the Pag-Ibig Fund. It
even issued certifications dated October 10, 2008, stating that Gomez
was a permanent employee and that the company had remitted
combined contributions during her tenure. The company also made
her a member of the PDMC’s savings and provident plan and its
retirement plan. It grouped her with the managers covered by the
company’s group hospitalization insurance. Likewise, she underwent
regular employee performance appraisals, purchased stocks through
the employee stock option plan, and was entitled to vacation and

25
emergency leaves. PDMC even withheld taxes on her salary and
declared her as an employee in the official Bureau of Internal Revenue
forms. These are all indicia of an employer-employee relationship
which respondent PDMC failed to refute. (GLORIA V. GOMEZ v. PNOC
DEVELOPMENT AND MANAGEMENT CORPORATION, G.R. No. 174044,
November 27, 2009)

• Control Test

In the case at bench, both the Labor Arbiter and the NLRC were
one in their conclusion that respondents were not independent
contractors, but employees of petitioner. In determining the existence
of an employer-employee relationship between the parties, both the
Labor Arbiter and the NLRC examined and weighed the circumstances
against the four-fold test which has the following elements: (1) the
power to hire, (2) the payment of wages, (3) the power to dismiss, and
(4) the power to control the employees’ conduct, or the so-called
“control test.” Of the four, the power of control is the most important
element. More importantly, the control test merely calls for the
existence of the right to control, and not necessarily the exercise
thereof. (DEALCO FARMS, INC., vs. NATIONAL LABOR RELATIONS
COMMISSION (5th DIVISION), G.R. No. 153192 January 30, 2009)

In this regard, it has not escaped the notice of the Court that the
operations of the hotel itself do not cease with the end of each event
or function and that there is an ever present need for individuals to
perform certain tasks necessary in the petitioner’s business. Thus,
although the tasks themselves may vary, the need for sufficient
manpower to carry them out does not. In any event, as borne out by
the findings of the NLRC, the petitioner determines the nature of the
tasks to be performed by the private respondent, in the process
exercising control. (MARANAW HOTELS AND RESORT CORP vs COURT
OF APPEALS, SHERYL OABEL AND MANILA RESOURCE DEVELOPMENT
CORP., G.R. No. 149660, January 20, 2009)

Contrary to petitioners’ contention, the various office directives

issued by Shangri-la’s officers do not imply that it is Shangri-la’s
management and not respondent doctor who exercises control over
them or that Shangri-la has control over how the doctor and the nurses
perform their work. The letter addressed to respondent doctor dated
February 7, 2003 from a certain Tata L. Reyes giving instructions
regarding the replenishment of emergency kits is, at most,
administrative in nature, related as it is to safety matters; while the
letter dated May 17, 2004 from Shangri-la’s Assistant Financial
Controller, Lotlot Dagat, forbidding the clinic from receiving cash
payments from the resort’s guests is a matter of financial policy in

26
order to ensure proper sharing of the proceeds, considering that
Shangri-la and respondent doctor share in the guests’ payments for
medical services rendered. In fine, as Shangri-la does not control how
the work should be performed by petitioners, it is not petitioners’
employer. (JEROMIE D. ESCASINAS and EVAN RIGOR SINGCO v.
SHANGRI-LA’S MACTAN ISLAND RESORT and DR. JESSICA J.R. PEPITO,
G.R. No. 178827, March 4, 2009)

To reiterate, while respondent and SSCP no longer had any legal

relationship with the termination of the Agreement, petitioners
remained at their post securing the premises of respondent while
receiving their salaries, allegedly from SSCP. Clearly, such a situation
makes no sense, and the denials proffered by respondent do not shed
any light to the situation. It is but reasonable to conclude that, with the
behest and, presumably, directive of respondent, petitioners continued
with their services. Evidently, such are indicia of control that
respondent exercised over petitioners. (RAUL G. LOCSIN and EDDIE B.
TOMAQUIN v. PHILIPPINE LONG DISTANCE TELEPHONE COMPANY, G.R.
No. 185251, October 2, 2009)

Equity

While the Court commiserates with the plight of Tirazona, who

has recently manifested that she has since been suffering from her
poor health condition, the Court cannot grant her plea for the award of
financial benefits based solely on this unfortunate circumstance. For
all its conceded merit, equity is available only in the absence of law
and not as its replacement. Equity as an exceptional extenuating
circumstance does not favor, nor may it be used to reward, the
indolent or the wrongdoer, for that matter. This Court will not allow a
party, in the guise of equity, to benefit from its own fault. (MA.
WENELITA S. TIRAZONA, vs. PHILIPPINE EDS TECHNO- SERVICE INC.
(PET INC.) AND/OR KEN KUBOTA, MAMORU ONO and JUNICHI HIROSE,
G.R. No. 169712, January 20, 2009)

Estoppel

Estoppel, an equitable principle rooted on natural justice,

prevents a person from rejecting his previous acts and representations
to the prejudice of others who have relied on them. This principle of
law applies to corporations as well. The PDMC in this case is estopped
from claiming that despite all the appearances of regular employment
that it weaved around petitioner Gomez’s position it must have
technically hired her only as a corporate officer. The board and its
officers made her stay on and work with the company for years under
the belief that she held a regular managerial position. (GLORIA V.

27
GOMEZ v. PNOC DEVELOPMENT AND MANAGEMENT CORPORATION,
G.R. No. 174044, November 27, 2009)

Evidence

It may be true that the NBI agents’ affidavit did not directly
implicate petitioners in the scheme. However, their co-employees
Gimena, Welsh and Derupe, who had personal knowledge of
petitioners’ activities, narrated in their affidavits the nature, dates and
time of their (petitioners’) participation. Petitioners did not refute
these sworn statements. Neither did they explain why their former
colleagues would unjustly and falsely testify against them even if they
had the opportunity to defend themselves during the administrative
investigations conducted by respondent. These pieces of evidence,
when taken together, constituted substantial evidence to prove
petitioners’ culpability. It is of no moment that they were acquitted in
the criminal case. Petitioners’ infractions were willful and serious, thus
their dismissal was proper under the circumstances. (RENITA DEL
ROSARIO, et al., v. MAKATI CINEMA SQUARE CORPORATION, G.R. No.
170014, July 3, 2009)

It is common practice for companies to provide identification

cards to individuals not only as a security measure, but more
importantly to identify the bearers thereof as bona fide employees of
the firm or institution that issued them. The provision of company-
issued identification cards and uniforms to respondents, aside from
their inclusion in MCI’s summary payroll, indubitably constitutes
substantial evidence sufficient to support only one conclusion: that
respondents were indeed employees of MCI. (MASONIC CONTRACTOR,
INC. v. MAGDALENA MADJOS , et al., G.R. No. 185094, November 25,
2009)

• Proof of Mailing

In this case and in like manner, while a postmaster’s certification is

usually sufficient proof of mailing, its evidentiary value must be
differentiated from the situation presently before us where the
postmaster’s certification is intended to prove that the post office had
committed a mistake in placing the date of receipt on the registry
return card. In other words, the Postmaster’s certification is offered to
overcome the presumption that the Malate Post Office regularly
performed its official duties when the registry return card was filled up
by the recipient of the labor arbiter’s decision with November 21, 1999
as the date of receipt. We find it significant that both the petitioner and

28
the postmaster’s certification failed to show that the Malate Post Office
committed an inadvertence in handling the registry return card so that
a corrective certification from the Postmaster was necessary. In the
absence of such justification for the certification, we are compelled to
deny it of any evidentiary value for the purpose it was submitted.
(EUREKA PERSONNEL & MANAGEMENT SERVICES, INC. v. EDUARDO
VALENCIA, G.R. No. 159358, July 15, 2009)

Execution

We would like to stress the settled rule that the power of the
court in executing judgments extends only to properties
unquestionably belonging to the judgment debtor alone. To be
sure, one man’s goods shall not be sold for another man’s debts. A
sheriff is not authorized to attach or levy on property not belonging
to the judgment debtor, and even incurs liability if he wrongfully
levies upon the property of a third person. (PANTRANCO
EMPLOYEES ASSOCIATION (PEA-PTGWO) and PANTRANCO
RETRENCHED EMPLOYEES ASSOCIATION (PANREA) v. NATIONAL
LABOR RELATIONS COMMISSION (NLRC), G.R. No. 170689, G.R. No.
170705)

Finality of Factual Findings

The well-entrenched rule is that factual findings of administrative

or quasi-judicial bodies, which are deemed to have acquired expertise
in matters within their respective jurisdictions, are generally accorded
not only respect but even finality, and bind the Court when supported
by substantial evidence. Section 5, Rule 133 defines substantial
evidence as “that amount of relevant evidence which a reasonable
mind might accept as adequate to justify a conclusion.” (DEALCO
FARMS, INC., vs. NATIONAL LABOR RELATIONS COMMISSION (5th
DIVISION), G.R. No. 153192 January 30, 2009)

Lastly, in its assailed decision, the CA affirmed the ruling of the

NLRC and adopted as its own the latter's factual findings. Long-
established is the doctrine that findings of fact of quasi-judicial
bodies like the NLRC are accorded respect, even finality, if
supported by substantial evidence. When passed upon and upheld
by the CA, they are binding and conclusive upon the Supreme
Court and will not normally be disturbed. Though this doctrine is
not without exceptions, the Court finds that none are applicable to
the present case. ROMEO N. VENTURA, vs. COURT OF APPEALS,
NATIONAL LABOR RELATIONS COMMISSION, GENUINO ICE CO., INC.,
and HECTOR GENUINO, G.R. No. 182570, January 27, 2009)

29
 • Exception

The appellate court predicated its reversal of the NLRC decision

that petitioners were illegally dismissed on petitioners’ supposed
abandonment of their jobs, and justified the work rotation/reduction
scheme adopted by respondent as a valid exercise of management
prerogative in light of respondent’s business losses. (FE LA ROSA et.
al., v. AMBASSADOR HOTEL,G.R. No. 177059, March 13, 2009)

The issue of the reasonableness of attorney's fees is a question

of fact. Well-settled is the rule that conclusions and findings of fact of
the CA are entitled to great weight on appeal and will not be disturbed
except for strong and cogent reasons which are absent in the case at
bench. The findings of the CA, which are supported by substantial
evidence, are almost beyond the power of review by the Supreme
Court. (EVANGELINA MASMUD (as substitute complainant for
ALEXANDER J. MASMUD) v. NATIONAL LABOR RELATIONS COMMISSION,
G.R. No. 183385, February 13, 2009)

Petitioner's argument that the CA erred and abused its discretion

in reversing the findings of the Labor Arbiter and the NLRC, as it is the
court's policy of non-interference in the exercise of the adjudicatory
functions of the administrative bodies, is devoid of merit. We agree
with petitioner that factual findings of quasi-judicial and administrative
bodies are accorded great respect and even finality by the courts.
However, this rule is not absolute. When there is a showing that the
factual findings of administrative bodies were arrived at arbitrarily or in
disregard of the evidence on record, they may be examined by the
courts. The CA can grant the petition for certiorari if it finds that the
NLRC, in its assailed decision or resolution, made a factual finding not
supported by substantial evidence. It is within the jurisdiction of the
CA, whose jurisdiction over labor cases has been expanded to review
the findings of the NLRC. In R & E Transport, Inc. v. Latag, we held:

The power of the CA to review NLRC decisions via a Rule 65

petition is now a settled issue. As early as St. Martin Funeral Homes v.
NLRC, we have definitively ruled that the proper remedy to ask for the
review of a decision of the NLRC is a special civil action for certiorari
under Rule 65 of the Rules of Court, and that such petition should be
filed with the CA in strict observance of the doctrine on the hierarchy
of courts. Moreover, it has already been explained that under Section 9
of Batas Pambansa (BP) 129, as amended by Republic Act 7902, the
CA – pursuant to the exercise of its original jurisdiction over petitions
for certiorari – was specifically given the power to pass upon the
evidence, if and when necessary, to resolve factual issues.(EMCOR

30
INCORPORATED v. MA. LOURDES D. SIENES, G.R. No. 152101,
September 8, 2009)

Forum Shopping

On the part of Mr. Gumarang, knowing fully well that he was no

longer the representative of the NCTEA, why did he not inform both the
Court of Appeals and the Supreme Court of such fact when he filed the
petitions? Instead, he claimed to be the duly authorized
representative of the NCTEA which he was not. His omission and
misrepresentation are clear indications of bad faith of which this Court
does not approve. He should have known that by including NCTEA as
petitioner and signing as its representative, he should have had the
authority to do so. This, he did not possess. When he alone signed on
his behalf and that of the NCTEA, not once but twice, he flagrantly
violated the rule on the filing of a certificate of non-forum shopping.
(NORTHEASTERN COLLEGE TEACHERS AND EMPLOYEES ASSOCIATION
vs. NORTHEASTERN COLLEGE, INC., G.R. No. 152923, January 19,
2009)

Without the required authority from the NCTEA, Mr. Gumarang

cannot represent the NCTEA. As explained above, if there are several
petitioners, the failure of one to sign the certificate of non-forum
shopping is a deficiency which is a ground for the dismissal of the
petition. In the case before us, there being two petitioners – NCTEA
and Mr. Gumarang – both of them should sign the certificate against
forum shopping. Since there was only one signatory, the requirement
on the filing of the certificate against forum shopping has not been
complied with. As in the Court of Appeals, Mr. Gumarang failed to
show why the duly authorized representative of the NCTEA was unable
to sign the certification, and to convince this Court that the outright
dismissal of the petition would defeat the administration of justice.
(NORTHEASTERN COLLEGE TEACHERS AND EMPLOYEES ASSOCIATION
vs. NORTHEASTERN COLLEGE, INC., G.R. No. 152923, January 19,
2009)

Fuentebella and Rolling Hills Memorial Park v. Castro, on the

requirement of a certification against forum shopping, explains:
The reason for this is that the principal party has
actual knowledge whether a petition has previously been
filed involving the same case or substantially the same
issues. If, for any reason, the principal party cannot sign
the petition, the one signing on his behalf must have
been duly authorized.

31
 . . . Where the petitioner is a corporation, the
certification against forum shopping should be signed by
its duly authorized director or representative …[I]f the
real party-in-interest is a corporate body, an officer of
the corporation can sign the certification against forum
shopping as long as he is authorized by a resolution of
its board of directors.

xxxx

A certification without the proper authorization is

defective and constitutes a valid cause for the dismissal
of the petition. (Citations omitted; emphasis, italics and
underscoring supplied)

Petitioner’s discourse on relaxation of technical rules of

procedure in the interest of substantial justice does not impress.
While there have been instances when the Court dispensed with
technicalities on the basis of special circumstances or compelling
reasons, there is no such circumstance or reason in the present case
which warrants the liberal application of technical rules. (EAGLE
STAR SECURITY SERVICES, INC. v. BONIFACIO L. MIRANDO, G.R. No.
179512, July 30, 2009)

Grave Abuse of Discretion

The Regional Director fully relied on the self-serving allegations

of respondent and misinterpreted the documents presented as
evidence by respondent. To make matters worse, DOLE denied
petitioner’s appeal based solely on petitioner’s alleged failure to file a
cash or surety bond, without any discussion on the merits of the case.
Since the petition for certiorari before the Court of Appeals sought the
reversal of the two aforesaid orders, the appellate court necessarily
had to examine the evidence anew to determine whether the
conclusions of the DOLE were supported by the evidence presented. It
appears, however, that the Court of Appeals did not even review the
assailed orders and focused instead on a general discussion of due
process and the jurisdiction of the Regional Director. Had the
appellate court truly reviewed the records of the case, it would have
seen that there existed valid and sufficient grounds for finding grave
abuse of discretion on the part of the DOLE Secretary as well the
Regional Director. In ruling and acting as it did, the Court finds that
the Court of Appeals may be properly subjected to its certiorari
jurisdiction. After all, this Court has previously ruled that the
extraordinary writ of certiorari will lie if it is satisfactorily

32
established that the tribunal had acted capriciously and whimsically in
total disregard of evidence material to or even decisive of the
controversy. (PEOPLE’S BROADCASTING(BOMBO RADYO PHILS., INC.)
vs. THE SECRETARY OF THE DEPARTMENT OF LABOR AND
EMPLOYMENT, THE REGIONAL DIRECTOR, DOLE REGION VII, and
JANDELEON JUEZAN, G.R. No. 179652, May 8, 2009)

Hearing

A hearing means that a party should be given a chance to

adduce his evidence to support his side of the case and that the
evidence should be taken into account in the adjudication of the
controversy. To be heard” does not mean verbal argumentation alone
inasmuch as one may be heard just as effectively through written
explanations, submissions or pleadings. Therefore, while the phrase
“ample opportunity to be heard” may in fact include an actual hearing,
it is not limited to a formal hearing only. In other words, the existence
of an actual, formal “trial-type” hearing, although preferred, is not
absolutely necessary to satisfy the employee’s right to be heard.
(FELIX B. PEREZ and AMANTE G. DORIA vs. PHILIPPINE TELEGRAPH AND
TELEPHONE COMPANY and JOSE LUIS SANTIAGO, G.R. No. 152048, April
7, 2009)

• Dialogue not Tantamount to Hearing

Policarpio's allegations are self-serving. Except for her claim as

stated in the respondent's Position Paper, nowhere from the records
can We find that Bergante and Inguillo were accorded the opportunity
to present evidence in support of their defenses. Policarpio relied
heavily on the “Petisyon” of FPSILU. She failed to convince Us that
during the dialogue, she was able to ascertain the validity of the
charges mentioned in the “Petisyon.” In her futile attempt to prove
compliance with the procedural requirement, she reiterated that the
objective of the dialogue was to provide the employees “the
opportunity to receive the act of grace of FPSI by giving them an
amount equivalent to one-half (½) month of their salary for every year
of service.” We are not convinced. We cannot even consider the
demand and counter-offer for the payment of the employees as an
amicable settlement between the parties because what took place was
merely a discussion only of the amount which the employees are
willing to accept and the amount which the respondents are willing to
give. Such non-compliance is also corroborated by Bergante and
Inguillo in their pleadings denouncing their unjustified dismissal. In
fine, We hold that the dialogue is not tantamount to the hearing or
conference prescribed by law. (Herminigildo Inguillo and Zenaida

33
Bergante v. First Philippine Scales, Inc. and/or Amparo Policarpio,
Manager, G.R. No. 165407, June 5, 2009

Inchoate Right

Again, the contention is bereft of merit. While PNB has an

apparent interest in Mega Prime’s assets being the creditor of the
latter for a substantial amount, its interest remains inchoate and has
not yet ripened into a present substantial interest, which would give it
the standing to maintain an action involving the subject properties. As
aptly observed by the Labor Arbiter, PNB only has an inchoate right to
the properties of Mega Prime in case the latter would not be able to
pay its indebtedness. This is especially true in the instant case, as the
debt being claimed by PNB is secured by the accessory contract of
pledge of the entire stockholdings of Mega Prime to PNB-Madecor.
(PANTRANCO EMPLOYEES ASSOCIATION (PEA-PTGWO) and
PANTRANCO RETRENCHED EMPLOYEES ASSOCIATION (PANREA) v.
NATIONAL LABOR RELATIONS COMMISSION (NLRC), G.R. No. 170689,
G.R. No. 170705)

Independent Contractor

The existence of an independent and permissible contractor

relationship is generally established by considering the following
determinants: whether the contractor is carrying on an independent
business; the nature and extent of the work; the skill required; the
term and duration of the relationship; the right to assign the
performance of a specified piece of work; the control and supervision
of the work to another; the employer's power with respect to the
hiring, firing and payment of the contractor's workers; the control of
the premises; the duty to supply the premises, tools, appliances,
materials and labor; and the mode, manner and terms of payment.
(JEROMIE D. ESCASINAS and EVAN RIGOR SINGCO v. SHANGRI-LA’S

In sum, there existed no employer-employee relationship

between the parties. De Raedt is an independent contractor, who was
engaged by SGV to render services to SGV’s client TMI, and ultimately
to DA on the CECAP project, regarding matters in the field of her
special knowledge and training for a specific period of time. Unlike an
ordinary employee, De Raedt received retainer fees and benefits such
as housing and subsistence allowances and medical insurance. De
Raedt’s services could be terminated on the ground of end of contract
between the DA and TMI, and not on grounds under labor laws.
Though the end of the contract between the DA and TMI was not the

34
ground for the withdrawal of De Raedt from the CECAP, De Raedt was
disengaged from the project upon the instruction of SGV’s client, TMI.
Most important of all, SGV did not exercise control over the means and
methods by which De Raedt performed her duties as Sociologist. SGV
did impose rules on De Raedt, but these were necessary to ensure
SGV’s faithful compliance with the terms and conditions of the Sub-
Consultancy Agreement it entered into with TMI. (SYCIP, GORRES,
VELAYO & COMPANY, v. CAROL DE RAEDT, G.R. No. 161366, June 16,
2009)

Insubordination

Aside from the findings of sexual abuse, petitioner is also guilty

of insubordination. Records show that after filing a case for
constructive dismissal on April 13, 1994 against the respondent,
petitioner continued working and performing his functions with the
respondent company until his termination on May 19, 1994. However,
despite receipt of the various notices sent by respondent to him to
report to the office and to submit written explanations relative to his
failure to follow instructions, the records of the case are bereft of
showing that he filed any written explanation to any of these notices.
His continued failure to carry out the reasonable oral or written
instructions of his supervisor is punishable by insubordination, which is
provided under Rule IV.5.a of the Operational Instruction OI-A-AP25,
Work Rules. While petitioner cannot be faulted in believing that
respondent constructively dismissed him from work, he was still,
strictly speaking, respondent's employee when he received the written
notices. As an employee, he should have at least responded thereto,
as instructed. (RAMON B. FORMANTES v. DUNCAN PHARMACEUTICALS,
PHILS., INC., G.R. No. 170661, December 4, 2009)

Interpretation of Doubt

We reject petitioner’s self-serving contention. Having failed to

substantiate its allegation on the relationship between the parties, we
stick to the settled rule in controversies between a laborer and his
master that doubts reasonably arising from the evidence should be
resolved in the former’s favor. The policy is reflected in no less than
the Constitution, Labor Code and Civil Code. (DEALCO FARMS, INC., vs.
NATIONAL LABOR RELATIONS COMMISSION (5th DIVISION), G.R. No.
153192 January 30, 2009)

The relations between capital and labor are so impressed with

public interest, and neither shall act oppressively against the other, or
impair the interest or convenience of the public. In case of doubt, all

35
labor legislation and all labor contracts shall be construed in favor of
the safety and decent living for the laborer. (BECMEN SERVICE
EXPORTER v. SPOUSES SIMPLICIO and MILA CUARESMA (for and in
behalf oftheir daughter, Jasmin G. Cuaresma), WHITE FALCON
SERVICES, INC. and JAIME ORTIZ (President,White Falcon Services, Inc.)
AND PROMOTION, INC.,G.R. Nos. 182978-79, G.R. Nos. 184298-99,
April 7, 2009)

Job contracting or Subcontracting

Permissible job contracting or subcontracting refers to an

arrangement whereby a principal agrees to farm out with a contractor
or subcontractor the performance of a specific job, work, or service
within a definite or predetermined period, regardless of whether such
job, work or, service is to be performed or completed within or
outside the premises of the principal. Under this arrangement, the
following conditions must be met: (a) the contractor carries on a
distinct and independent business and undertakes the contract work
on his account under his own responsibility according to his own
manner and method, free from the control and direction of his
employer or principal in all matters connected with the performance
of his work except as to the results thereof; (b) the contractor has
substantial capital or investment; and (c) the agreement between
the principal and contractor or subcontractor assures the contractual
employees’ entitlement to all labor and occupational safety and
health standards, free exercise of the right to self-organization,
security of tenure, and social welfare benefits. (RAMY GALLEGO v.
BAYER PHILIPPINES, INC., DANPIN GUILLERMO, PRODUCT IMAGE
MARKETING, INC., and EDGARDO BERGONIA, G.R. No. 179807, July
31, 2009)

Joint Venture
To the Court, the Contract between the Cooperative and DFI, far
from being a job contracting arrangement, is in essence a business
partnership that partakes of the nature of a joint venture. The rules on
job contracting are, therefore, inapposite. The Court may not alter the
intention of the contracting parties as gleaned from their stipulations
without violating the autonomy of contracts principle under Article
1306 of the Civil Code which gives the contracting parties the utmost
liberality and freedom to establish such stipulations, clauses, terms
and conditions as they may deem convenient, provided they are not
contrary to law, morals, good custom, public order or public policy.
(OLDARICO S. TRAVEÑO, et al v. BOBONGON BANANA GROWERS

36
MULTI-PURPOSE COOPERATIVE, TIMOG AGRICULTURAL CORPORATION,
DIAMOND FARMS, INC., and DOLE ASIA PHILIPPINES, G.R. No. 164205,
September 3, 2009)

Judgment

We disfavor delay in the enforcement of the labor arbiter’s

decision. Once a judgment becomes final and executory, the prevailing
party should not be denied the fruits of his victory by some subterfuge
devised by the losing party. Final and executory judgments can neither
be amended nor altered except for correction of clerical errors, even if
the purpose is to correct erroneous conclusions of fact or of law. Trial
and execution proceedings constitute one whole action or suit such
that a case in which execution has been issued is regarded as still
pending so that all proceedings in the execution are proceedings in the
suit. (C-E CONSTRUCTION CORPORATION v. NATIONAL LABOR
RELATIONS, G.R. No. 180188, March 25, 2009)

Jurisdiction

It is a settled rule that jurisdiction over the subject matter is

conferred by law. The determination of the rights of a director and
corporate officer dismissed from his employment as well as the
corresponding liability of a corporation, if any, is an intra-corporate
dispute subject to the jurisdiction of the regular courts. Thus, the
appellate court correctly ruled that it is not the NLRC but the regular
courts which have jurisdiction over the present case. (LESLIE OKOL v.
SLIMMERS WORLD INTERNATIONAL, BEHAVIOR MODIFICATIONS, INC.,
G.R. No. 160146, December 11, 2009)

In sum, when the labor arbiter proceeded with the consolidated cases
despite the SEC suspension order, he exceeded his jurisdiction to hear
and decide illegal dismissal cases and the CA correctly reversed his June
16, 2004 order. (GINA M. TIANGCO, et al, v. UNIWIDE SALES
WAREHOUSE CLUB, INC., G.R. No. 168697, December 14, 2009)

Intra-Corporate Dispute

Atty. Garcia tries to deny he is an officer of ETPI. Not being a

corporate officer, he argues that the Labor Arbiter has jurisdiction over
the case. One of the corporate officers provided for in the by-laws of
ETPI is the Vice-President. It can be gathered from Atty. Garcia’s
complaint-affidavit that he was Vice President for Business Support
Services and Human Resource Departments of ETPI when his

37
employment was terminated effective 16 April 2000 . It is therefore
clear from the by-laws and from Atty. Garcia himself that he is a
corporate officer. One who is included in the by-laws of a corporation
in its roster of corporate officers is an officer of said corporation and
not a mere employee. Being a corporate officer, his removal is
deemed to be an intra-corporate dispute cognizable by the SEC and
not by the Labor Arbiter. (ATTY. VIRGILIO R. GARCIA v. EASTERN
TELECOMMUNICATIONS PHILIPPINES, INC. and ATTY. SALVADOR C.
HIZON, G.R. No. 173115, EASTERN TELECOMMUNICATIONS
PHILIPPINES, INC. and ATTY. SALVADOR C. HIZON v. ATTY. VIRGILIO R.
GARCIA, G.R. Nos. 173163-64, April 16, 2009)

• Demarcation line Between DOLE’s Prerogative

and NLRC’s Jurisdiction

It can be assumed that the DOLE in the exercise of its visitorial

and enforcement power somehow has to make a determination of the
existence of an employer-employee relationship. Such prerogatival
determination, however, cannot be coextensive with the visitorial and
enforcement power itself. Indeed, such determination is merely
preliminary, incidental and collateral to the DOLE’s primary function of
enforcing labor standards provisions. The determination of the
existence of employer-employee relationship is still primarily lodged
with the NLRC. This is the meaning of the clause “in cases where the
relationship of employer-employee still exists” in Art. 128(b).
(PEOPLE’S BROADCASTING(BOMBO RADYO PHILS., INC.) vs. THE
SECRETARY OF THE DEPARTMENT OF LABOR AND EMPLOYMENT, THE
REGIONAL DIRECTOR, DOLE REGION VII, and JANDELEON JUEZAN, G.R.
No. 179652, May 8, 2009)

In sum, respondent contested the findings of the labor inspector

during and after the inspection and raised issues the resolution of
which necessitated the examination of evidentiary matters not
verifiable in the normal course of inspection. Hence, the Regional
Director was divested of jurisdiction and should have endorsed the
case to the appropriate Arbitration Branch of the NLRC. Considering,
however, that an illegal dismissal case had been filed by petitioners
wherein the existence or absence of an employer-employee
relationship was also raised, the CA correctly ruled that such
endorsement was no longer necessary. (VICTOR METEORO, et al v.
CREATIVE CREATURES, INC., G.R. No. 171275, July 13, 2009)

Labor-only Contractor

38
 In sum, Interserve did not have substantial capital or investment
in the form of tools, equipment, machineries, and work premises; and
respondents, its supposed employees, performed work which was
directly related to the principal business of petitioner. It is, thus,
evident that Interserve falls under the definition of a “labor-only”
contractor, under Article 106 of the Labor Code; as well as Section 5(i)
of the Rules Implementing Articles 106-109 of the Labor Code, as
amended. (COCA-COLA BOTTLERS PHILS., INC v. ALAN M. AGITO, et
al., G.R. No. 179546, February 13, 2009)

In a labor-only contract, there are three parties involved: (1) the

“labor-only” contractor; (2) the employee who is ostensibly under the
employ of the “labor-only” contractor; and (3) the principal who is
deemed the real employer. Under this scheme, the “labor-only”
contractor is the agent of the principal. Here, Vedali is the “labor-
only” contractor; individual respondents are the employees and
petitioner is the principal. The law makes the principal responsible to
the employees of the “labor-only contractor” as if the principal itself
directly hired or employed the employees. (ILIGAN CEMENT
CORPORATION v. ILIASCOR EMPLOYEES AND WORKERS UNION –
SOUTHERN PHILIPPINES FEDERATION OF LABOR (IEWU-SPFL), AND ITS
OFFICERS AND MEMBERS, et. al, G.R. No. 158956, April 24, 2009)

Length of Service

Although his nearly two decades of service might generally be

considered for some form of financial assistance to shield him from the
effects of his termination, Tomada’s acts reflect a regrettable lack of
concern for his employer. If length of service justifies the mitigation of
the penalty of dismissal, then this Court would be awarding disloyalty,
distorting in the process the meaning of social justice and undermining
the efforts of labor to cleanse its ranks of undesirables. (EDUARDO M.
TOMADA, SR. v. RFM CORPORATION-BAKERY FLOUR DIVISION and
JOSE MARIA CONCEPCION III, G.R. No. 163270, September 11, 2009)

Liability of Corporate Officers

However, Article 212(e) of the Labor Code, by itself, does not

make a corporate officer personally liable for the debts of the
corporation because Section 31 of the Corporation Code is still the
governing law on personal liability of officers for the debts of the
corporation. Section 31 of the Corporation Code provides:

39
 Liability of directors, trustees or officers. — Directors or
trustees who willfully and knowingly vote for or assent to
patently unlawful acts of the corporation or who are guilty of
gross negligence or bad faith in directing the affairs of the
corporation or acquire any personal or pecuniary interest in
conflict with their duty as such directors, or trustees shall be
liable jointly and severally for all damages resulting therefrom
suffered by the corporation, its stockholders or members and
other persons. x x x

There was no showing of David willingly and knowingly voting for

or assenting to patently unlawful acts of the corporation, or that David
was guilty of gross negligence or bad faith. (ARMANDO DAVID v.
NATIONAL FEDERATION OF LABOR UNION and MARIVELES APPAREL
CORPORATION, G.R. Nos. 148263 and 148271-72, April 21, 2009)

Liability of General Manager

Lastly, we come to the issue of whether Wiltschek, as the

General Manager, should be personally liable together with M+W
Zander. We agree with petitioners that he should not be made
personally liable. The general manager of a corporation should not be
made personally answerable for the payment of an illegally dismissed
employee's monetary claims arising from the dismissal unless he had
acted maliciously or in bad faith in terminating the services of the
employee. The employer corporation has a separate and distinct
personality from its officers who merely act as its agents. (M+W
ZANDER PHILIPPINES, INC. and ROLF WILTSCHEK v. TRINIDAD M.
ENRIQUEZ, G.R. No. 169173, June 5, 2009)

Liability of Recruitment Agencies and Foreign-Based Employer

Private employment agencies are held jointly and severally liable

with the foreign-based employer for any violation of the recruitment
agreement or contract of employment. This joint and solidary liability
imposed by law against recruitment agencies and foreign employers is
meant to assure the aggrieved worker of immediate and sufficient
payment of what is due him. If the recruitment/placement agency is a
juridical being, the corporate officers and directors and partners as the
case may be, shall themselves be jointly and solidarily liable with the
corporation or partnership for the aforesaid claims and damages.
(BECMEN SERVICE EXPORTER v. SPOUSES SIMPLICIO and MILA
CUARESMA (for and in behalf oftheir daughter, Jasmin G. Cuaresma),

40
WHITE FALCON SERVICES, INC. and JAIME ORTIZ (President,White
Falcon Services, Inc.) AND PROMOTION, INC.,G.R. Nos. 182978-79, G.R.
Nos. 184298-99, April 7, 2009)

Management Prerogative

As aptly cited by the CA:

The general rule is that the characterization by an employer of

an employee’s services as no longer necessary or sustainable is an
exercise of business judgment on the part of the employer. The
wisdom or soundness of such a characterization or decision is not, as a
general rule, subject to discretionary review on the part of the Labor
Arbiter, the NLRC and the CA. Such characterization may, however, be
rejected if the same is found to be in violation of the law or is arbitrary
or malicious.

We find no violations of law in the respondent’s actions against

the petitioner, nor was the respondent arbitrary or influenced by
malice in terminating the petitioner’s employment for redundancy. This
ground for termination is a legitimate exercise of management
prerogative unless attended to by arbitrariness or by the failure to
follow statutory requirements. No arbitrariness or any violations took
place in the present case. (MIRIAM B. ELLECCION VDA. DE LECCIONES
v. NATIONAL LABOR RELATIONS COMMISSION, NNA PHILIPPINES CO.,
INC. and MS. KIMI KIMUR A, G.R. No. 184735, September 17, 2009)

• Transfer

In this case, we find no reason to disturb the conclusion of the

Court of Appeals that there was no constructive dismissal.
Reassignments made by management pending investigation of
violations of company policies and procedures allegedly committed by
an employee fall within the ambit of management prerogative. The
decision of Quantum Foods to transfer Endico pending investigation
was a valid exercise of management prerogative to discipline its
employees. The transfer, while incidental to the charges against
Endico, was not meant as a penalty, but rather as a preventive
measure to avoid further loss of sales and the destruction of Quantum
Foods’ image and goodwill. It was not designed to be the culmination
of the then on-going administrative investigation against Endico.
(ARNULFO O. ENDICO vs. QUANTUM FOODS DISTRIBUTION CENTER,
G.R. No. 161615, January 30, 2009)

ATI’s transfer of Bismark IV’s base from Manila to Bataan was,

contrary to Aguanza’s assertions, a valid exercise of management

41
prerogative. The transfer of employees has been traditionally among
the acts identified as a management prerogative subject only to
limitations found in law, collective bargaining agreement, and general
principles of fair play and justice. Even as the law is solicitous of the
welfare of employees, it must also protect the right of an employer to
exercise what are clearly management prerogatives. The free will of
management to conduct its own business affairs to achieve its purpose
cannot be denied. (GUALBERTO AGUANZA v. ASIAN TERMINAL, INC.,
KEITH JAMES, RICHARD BARCLAY, and ATTY. RODOLFO CORVITE, G.R.
No. 163505, August 14, 2009)

Money Claims

An employee should be compensated for the work he has

rendered in accordance with the minimum wage, and must be
appropriately remunerated when he was suffered to work on a regular
holiday during the time he was employed by the petitioner company.
As regards the 13th month pay, an employee who was terminated at
any time before the time for payment of the 13th month pay is entitled
to this monetary benefit in proportion to the length of time he worked
during the year, reckoned from the time he started working during the
calendar year up to the time of his termination from the service.
(MANTLE TRADING SERVICES, INCORPORATED AND/OR BOBBY DEL
ROSARIO v. NATIONAL LABOR RELATIONS COMMISSION and PABLO S.
MADRIAGA,G.R. No. 166705,July 28,2009)

Motion for Reconsideration

In this case, the Decision dated January 18, 2005 of the

Secretary of Labor and Employment was received by petitioner on
January 25, 2005. It would have become final and executory on
February 4, 2005, the tenth day from petitioner’s receipt of the
decision. However, petitioner filed a petition for certiorari with the
Court of Appeals on even date. Clearly, petitioner availed of the proper
remedy since Department Order No. 40-03 explicitly prohibits the filing
of a motion for reconsideration. Such motion becomes dispensable
and not at all necessary. (CHRIS GARMENTS CORPORATION vs HON.
PATRICIA A. STO. TOMAS and CHRIS GARMENTS WORKERS UNION-
PTGWO LOCAL CHAPTER No. 832, G.R. No. 167426, January 12, 2009)

NLRC Rules of Procedure

• Reinstatement Compliance Report

The new NLRC Rules of Procedure, which took effect on January

7, 2006, now require the employer to submit a report of compliance

42
within 10 calendar days from receipt of the Labor Arbiter’s decision,
disobedience to which clearly denotes a refusal to reinstate. The
employee need not file a motion for the issuance of the writ of
execution since the Labor Arbiter shall thereafter motu proprio issue
the writ. With the new rules in place, there is hardly any difficulty in
determining the employer’s intransigence in immediately complying
with the order. (JUANITO A. GARCIA and ALBERTO J. DUMAGO vs.
PHILIPPINE AIRLINES, INC., G.R. No. 164856, January 20, 2009)

• Liberal Application of the Rules of Procedure

The Court is unimpressed. The gravity of Maralit’s infraction

demands the relaxation of strict rules of procedure. Strict rules of
procedure may be set aside to serve the demands of substantial
justice. Labor cases must be decided according to justice, equity, and
the substantial merits of the controversy. In Azul v. Banco Filipino
Savings and Mortgage Bank, the Court held:

The seriousness of petitioner’s infraction demanded the setting

aside of strict rules of procedure as to allow the determination on the
merits of whether he was lawfully dismissed. As held by the Court, the
application of technical rules of procedure may be relaxed to serve the
demands of substantial justice, particularly in labor cases, because
they must be decided according to justice and equity and the
substantial merits of the controversy.

There is substantial evidence showing that there was valid

cause for the bank to dismiss petitioner’s employment for loss of trust
and confidence. Petitioner was a bank accountant, which is a position
of trust and confidence. The amount involved is significant, almost
P4.5 million. (ESTER B. MARALIT v. PHILIPPINE NATIONAL BANK, G.R.
No. 163788, August 24, 2009)

Notice of Change of Address

PAL’s argument that its chaotic situation due to its rehabilitation

rendered the filing of a notice of change of address impractical does
not merit consideration. Since moving out from its office at Allied Bank
Center, where the NLRC decision was sent, PAL occupied four different
office addresses. Yet these office addresses could be found in the
same building, the PAL Center Building in Makati City. PAL merely
moved from one floor to another. To our mind, it would have been
more prudent had PAL informed the NLRC that it has moved from one
floor to another rather than allowed its old address at Allied Bank
Center to remain as its official address. To rule in favor of PAL
considering the circumstances in the instant case would negate the

43
purpose of the rules on completeness of service and the notice of
change of address, which is to place the date of receipt of pleadings,
judgments and processes beyond the power of the party being served
to determine at his pleasure. (PHILIPPINE AIRLINES, INC. v. HEIRS OF
BERNARDIN J. ZAMORA, G.R. No. 164267, G.R. No. 166996)

Overseas Employment Contracts

Respondent’s service award for the sixth contract is equivalent

only to half-month’s pay plus the proportionate amount for the
additional nine days of service he rendered after one year.
Respondent’s employment contracts expressly stated that his
employment ended upon his departure from work. Each year he
departed from work and successively new contracts were executed
before he reported for work anew. His service was not cumulative.
Pertinently, in Brent School, Inc. v. Zamora, we said that “a fixed term
is an essential and natural appurtenance” of overseas employment
contracts, as in this case. We also said in that case that under
American law, “[w]here a contract specifies the period of its duration, it
terminates on the expiration of such period. A contract of employment
for a definite period terminates by its own terms at the end of such
period.” As it is, Article 72 of the Saudi Labor Law is also of similar
import. It reads:

A labor contract concluded for a specified period shall

terminate upon the expiry of its term. If both parties continue
to enforce the contract, thereafter, it shall be considered
renewed for an unspecified period. (LWV CONSTRUCTION
CORPORATION v. MARCELO B. DUPO, G.R. No. 172342, July
13, 2009

In Placewell International Services Corporation v. Camote, we

held that the subsequently executed side agreement of an overseas
contract worker with the foreign employer is void, simply because it is
against our existing laws, morals and public policy. The subsequent
agreement cannot supersede the terms of the standard employment
contract approved by the POEA. Republic Act No. 8042, commonly
known as the Migrant Workers Act of 1995, expressly prohibits the
substitution or alteration, to the prejudice of the worker, of
employment contracts already approved and verified by the
Department of Labor and Employment (DOLE) from the time of the
actual signing thereof by the parties up to and including the period of
the expiration of the same, without the approval of DOLE. Since the
second employment contract petitioner Nisda signed with respondent
ADAMS was void for not having been sanctioned by the POEA, then
petitioner Nisda’s employment with respondent ADAMS was still

44
governed by his POEA-SEC until his repatriation to the Philippines on
17 July 2002. (CARLOS N. NISDA v. SEA SERVE MARITIME AGENCY and
KHALIFA A. ALGOSAIBI DIVING AND MARINE SERVICES, G. R. No.
179177, July 23, 2009)

Payment of Wages Pending Appeal

In other words, a dismissed employee whose case was favorably

decided by the Labor Arbiter is entitled to receive wages pending
appeal upon reinstatement, which is immediately executory. Unless
there is a restraining order, it is ministerial upon the Labor Arbiter to
implement the order of reinstatement and it is mandatory on the
employer to comply therewith. (JUANITO A. GARCIA and ALBERTO J.
DUMAGO vs. PHILIPPINE AIRLINES, INC., G.R. No. 164856, January 20,
2009)

Prescriptive Period for Illegal Dismissal

The law fixes the period of time within which petitioner could
seek remedy for his illegal dismissal and for as long as he filed his
Complaint within the prescriptive period, he shall be entitled to the full
protection of his right to backwages. In illegal dismissal cases, the
employee concerned is given a period of four years from the time of
his illegal dismissal within which to institute the complaint. This is
based on Article 1146 of the New Civil Code which states that actions
based upon an injury to the rights of the plaintiff must be brought
within four years. The four-year prescriptive period shall commence to
run only upon the accrual of a cause of action of the worker. Here,
petitioner was dismissed from service on 15 September 2001. He filed
his complaint for illegal dismissal on 14 June 2004. Clearly, then, the
instant case was filed within the prescriptive period. (ERWIN H. REYES
v. NATIONAL LABOR RELATIONS COMMISSION, G.R. No. 180551,
February 10, 2009)

Prescriptive Period for Money Claims

In the present case, the earliest incident covered by Article 1155

is the extrajudicial demand which came on January 7, 1995 . As the CA
correctly computed, the period for prescription started to run on
January 15, 1993 , and was interrupted on January 7, 1995 . UNILAB
only answered the petitioner’s January 7, 1995 letter on February 26,
1996 , with a categorical denial of the petitioner’s demand; the running
of the prescription period re-started on the date of this denial, but
again stopped again on August 9, 1996 , when the complaint before
the NLRC was filed. Adding all the running periods yields a total of less

45
than three (3) years; hence, the petitioner seasonably filed her
monetary claim when she filed her complaint before the NLRC.
(JANUARIA A. RIVERA v. UNITED LABORATORIES, INC.,G.R. No. 155639
April 22, 2009)

• Money Claims - OFWs

In Cadalin v. POEA’s Administrator, we held that Article 291

covers all money claims from employer-employee relationship and is
broader in scope than claims arising from a specific law. It is not
limited to money claims recoverable under the Labor Code, but applies
also to claims of overseas contract workers. The following ruling in
Cadalin v. POEA’s Administrator is instructive:

First to be determined is whether it is the Bahrain

law on prescription of action based on the Amiri Decree No.
23 of 1976 or a Philippine law on prescription that shall be
the governing law.

Article 156 of the Amiri Decree No. 23 of 1976

provides:

“A claim arising out of a contract of employment

shall not be actionable after the lapse of one year from the
date of the expiry of the contract” x x x.

As a general rule, a foreign procedural law will not be

applied in the forum. Procedural matters, such as service
of process, joinder of actions, period and requisites for
appeal, and so forth, are governed by the laws of the
forum. This is true even if the action is based upon a
foreign substantive law (Restatement of the Conflict of
Laws, Sec. 685; Salonga, Private International Law, 131
[1979]).

A law on prescription of actions is sui generis in

Conflict of Laws in the sense that it may be viewed either
as procedural or substantive, depending on the
characterization given such a law.

xxxx

However, the characterization of a statute into a

procedural or substantive law becomes irrelevant when the
country of the forum has a “borrowing statute.” Said
statute has the practical effect of treating the foreign

46
 statute of limitation as one of substance (Goodrich, Conflict
of Laws, 152-153 [1938]). A “borrowing statute” directs
the state of the forum to apply the foreign statute of
limitations to the pending claims based on a foreign law
(Siegel, Conflicts, 183 [1975]). While there are several
kinds of “borrowing statutes,” one form provides that an
action barred by the laws of the place where it accrued,
will not be enforced in the forum even though the local
statute has not run against it (Goodrich and Scoles, Conflict
of Laws, 152-153 [1938]). Section 48 of our Code of Civil
Procedure is of this kind. Said Section provides:

“If by the laws of the state or country where the

cause of action arose, the action is barred, it is also barred
in the Philippine Islands.”
Section 48 has not been repealed or amended by the
Civil Code of the Philippines. Article 2270 of said Code
repealed only those provisions of the Code of Civil
Procedure as to which were inconsistent with it. There is
no provision in the Civil Code of the Philippines, which is
inconsistent with or contradictory to Section 48 of the Code
of Civil Procedure (Paras, Philippine Conflict of Laws, 104
[7th ed.]).

In the light of the 1987 Constitution, however,

Section 48 [of the Code of Civil Procedure] cannot be
enforced ex proprio vigore insofar as it ordains the
application in this jurisdiction of [Article] 156 of the Amiri
Decree No. 23 of 1976.

The courts of the forum will not enforce any foreign

claim obnoxious to the forum’s public policy x x x. To
enforce the one-year prescriptive period of the Amiri Decree
No. 23 of 1976 as regards the claims in question would
contravene the public policy on the protection to labor.

xxxx
Thus, in our considered view, respondent’s complaint was filed well
within the three-year prescriptive period under Article 291 of our
Labor Code. This point, however, has already been mooted by our
finding that respondent’s service award had been paid, albeit the
payroll termed such payment as severance pay. (LWV
CONSTRUCTION CORPORATION v. MARCELO B. DUPO, G.R. No.
172342, July 13, 2009)

Probationary Employee

47
 A probationary employee or probationer is one who is on trial for
an employer, during which the latter determines whether or not he is
qualified for permanent employment. The probationary employment is
intended to afford the employer an opportunity to observe the fitness
of a probationary employee while at work, and to ascertain whether he
will become an efficient and productive employee. While the employer
observes the fitness, propriety and efficiency of a probationer to
ascertain whether he is qualified for permanent employment, the
probationer, on the other hand, seeks to prove to the employer that he
has the qualifications to meet the reasonable standards for permanent
employment. Thus, the word probationary, as used to describe the
period of employment, implies the purpose of the term or period, not
its length. (MAGIS YOUNG ACHIEVERS’ LEARNING CENTER and MRS.
VIOLETA T. CARIÑO v. ADELAIDA . MANALO, G.R. No. 178835, February
13, 2009 )

• Probationary Employment for Academic Personnel

For “academic personnel” in private schools, colleges and

universities, probationary employment is governed by Section 92 of
the 1992 Manual of Regulations for Private Schools (Manual), which
reads:

Section 92. Probationary Period. – Subject in all

instances to compliance with the Department and school
requirements, the probationary period for academic
personnel shall not be more than three (3) consecutive
years of satisfactory service for those in the elementary
and secondary levels, six (6) consecutive regular
semesters of satisfactory service for those in the tertiary
level, and nine (9) consecutive trimesters of satisfactory
service for those in the tertiary level where collegiate
courses are offered on a trimester basis.

(MAGIS YOUNG ACHIEVERS’ LEARNING CENTER and MRS. VIOLETA T.

CARIÑO v. ADELAIDA . MANALO, G.R. No. 178835, February 13, 2009 )

• Security of Tenure of Probationary Employees

As above discussed, probationary employees enjoy security of

tenure during the term of their probationary employment such that
they may only be terminated for cause as provided for by law, or if at
the end of the probationary period, the employee failed to meet the

48
reasonable standards set by the employer at the time of the
employee’s engagement. Undeniably, respondent was hired as a
probationary teacher and, as such, it was incumbent upon petitioner to
show by competent evidence that she did not meet the standards set
by the school. This requirement, petitioner failed to discharge. To
note, the termination of respondent was effected by that letter stating
that she was being relieved from employment because the school
authorities allegedly decided, as a cost-cutting measure, that the
position of “Principal” was to be abolished. Nowhere in that letter was
respondent informed that her performance as a school teacher was
less than satisfactory. (MAGIS YOUNG ACHIEVERS’ LEARNING CENTER
and MRS. VIOLETA T. CARIÑO v. ADELAIDA . MANALO, G.R. No. 178835,
February 13, 2009 )

• Termination of Probationary Employee

Under Article 281 of the Labor Code, a probationary employee

can be legally dismissed either: (1) for a just cause; or (2) when he fails
to qualify as a regular employee in accordance with the reasonable
standards made known to him by the employer at the start of the
employment. Nonetheless, the power of the employer to terminate the
services of an employee on probation is not without limitations. First,
this power must be exercised in accordance with the specific
requirements of the contract. Second, the dissatisfaction on the part
of the employer must be real and in good faith, not feigned so as to
circumvent the contract or the law. Third, there must be no unlawful
discrimination in the dismissal. In termination cases, the burden of
proving just or valid cause for dismissing an employee rests on the
employer. (DAVAO CONTRACTORS DEVELOPMENT COOPERATIVE
(DACODECO) v. MARILYN A. PASAWA,G.R. No. 172174,July 9, 2009)

Project Employee

While respondent performed tasks that were clearly vital,

necessary and indispensable to the usual business or trade of Alcatel,
respondent was not continuously rehired by Alcatel after the cessation
of every project. Records show that respondent was hired by Alcatel
from 1988 to 1995 for three projects, namely the PLDT X-5 project, the
PLDT X-4 IOT project and the PLDT 1342 project. On 30 April 1988,
upon the expiration of respondent’s contract for the PLDT X-4 IOT
project, Alcatel did not rehire respondent until 1 February 1991, or
after a lapse of 33 months, for the PLDT 1342 project. Alcatel’s
continuous rehiring of respondent in various capacities from February
1991 to December 1995 was done entirely within the framework of one
and the same project ― the PLDT 1342 project. This did not make
respondent a regular employee of Alcatel as respondent was not

49
continuously rehired after the cessation of a project. Respondent
remained a project employee of Alcatel working on the PLDT 1342
project. (ALCATEL PHILIPPINES, INC., v. RENE R. RELOS, G.R. No.
164315, July 3, 2009)

Protection to Labor

Whether employed locally or overseas, all Filipino workers enjoy

the protective mantle of Philippine labor and social legislation, contract
stipulations to the contrary notwithstanding. This pronouncement is in
keeping with the basic public policy of the State to afford protection to
labor, promote full employment, ensure equal work opportunities
regardless of sex, race or creed, and regulate the relations between
workers and employers. This ruling is likewise rendered imperative by
Article 17 of the Civil Code which states that laws which have for their
object public order, public policy and good customs shall not be
rendered ineffective by laws or judgments promulgated, or by
determinations or conventions agreed upon in a foreign country.
(BECMEN SERVICE EXPORTER v. SPOUSES SIMPLICIO and MILA
CUARESMA (for and in behalf oftheir daughter, Jasmin G. Cuaresma),
WHITE FALCON SERVICES, INC. and JAIME ORTIZ (President,White
Falcon Services, Inc.) AND PROMOTION, INC.,G.R. Nos. 182978-79, G.R.
Nos. 184298-99, April 7, 2009)

Thus, as held in that case, "the right of an employee to be

informed of the charges against him and to reasonable opportunity to
present his side in a controversy with either the company or his own
Union is not wiped away by a Union Security Clause or a Union Shop
Clause in a collective bargaining agreement. An employee is entitled
to be protected not only from a company which disregards his rights
but also from his own Union, the leadership of which could yield to the
temptation of swift and arbitrary expulsion from membership and mere
dismissal from his job." (HERMINIGILDO INGUILLO AND ZENAIDA
BERGANTE V. FIRST PHILIPPINE SCALES, INC. and/or AMPARO
POLICARPIO, MANAGER, G.R. No. 165407, June 5, 2009)

Question of Law / Fact

There is a question of law if the issue raised is capable of being

resolved without need of reviewing the probative value of the
evidence. The resolution of the issue must rest solely on what the law
provides on a given set of circumstances. Once it is clear that the
issue invites a review of the evidence presented, the question posed is
one of fact. If the query requires a re-evaluation of the credibility of
witnesses, or the existence or relevance of surrounding circumstances
and their relation to one another, the issue in that query is factual.

50
(GENERAL SANTOS COCA-COLA PLANT FREE WORKERS UNION-TUPAS
vs. COCA-COLA BOTTLERS PHILS., INC. (GENERAL SANTOS CITY), THE
COURT OF APPEALS and THE NATIONAL LABOR RELATIONS
COMMISSION, G.R. No. 178647)

Quitclaim

However, with respect to the second batch of quitclaims signed

by 85 of the remaining 160 employees who were terminated following
Hyatt’s permanent closure, we hold that these are valid and binding
undertakings. The said documents indicate that the amount received
by each of the employees represents a reasonable settlement of their
monetary claims against petitioner and were even signed in the
presence of a DOLE representative. A quitclaim, with clear and
unambiguous contents and executed for a valid consideration received
in full by the employee who signed the same, cannot be later
invalidated because its signatory claims that he was pressured into
signing it on account of his dire financial need. When it is shown that
the person executing the waiver did so voluntarily, with full
understanding of what he was doing, and the consideration for the
quitclaim is credible and reasonable, the transaction must be
recognized as a valid and binding undertaking. (HOTEL ENTERPRISES
OF THE PHILIPPINES, INC. (HEPI), owner of Hyatt Regency Manila, v.
SAMAHAN NG MGA MANGGAGAWA SA HYATT-NATIONAL UNION OF
WORKERS IN THE HOTEL AND RESTAURANT AND ALLIED INDUSTRIES
(SAMASAH-NUWHRAIN), G.R. No. 165756, June 5, 2009)

To excuse petitioners from complying with the terms of their

waivers, they must locate their case within any of three narrow
grounds: (1) the employer used fraud or deceit in obtaining the
waivers; (2) the consideration the employer paid is incredible and
unreasonable; or (3) the terms of the waiver are contrary to law, public
order, public policy, morals or good customs or prejudicial to a third
person with a right recognized by law. The preceding discussion on the
voluntariness of petitioners’ retirement from service effectively
removes these grounds beyond petitioners’ argumentative reach.
Accordingly, petitioners, by the terms of their waivers, are barred from
filing this suit. (ARSENIO F. QUEVEDO, et al., v. BENGUET ELECTRIC
COOPERATIVE,INCORPORATED (BENECO) and GERARDO P. VERZOSA,
G.R. No. 168927, September 11, 2009)

• Invalid Quitclaims

Significantly, the Manifestations filed by petitioner with respect to the

quitclaims executed by members of respondent Union state that 34 of
the 48 employees terminated on account of the downsizing program

51
have already executed quitclaims on various dates. We, however, take
judicial notice that 33 of these quitclaims failed to indicate the
amounts received by the terminated employees. Because of this,
petitioner leaves us no choice but to invalidate and set aside these
quitclaims. However, the actual amount received by the employees
upon signing the said documents shall be deducted from whatever
remaining amount is due them to avoid double recovery of separation
pay and other monetary benefits. We hereby order the Labor Arbiter to
effect the necessary computation on this matter. (HOTEL ENTERPRISES
OF THE PHILIPPINES, INC. (HEPI), owner of Hyatt Regency Manila, v.
SAMAHAN NG MGA MANGGAGAWA SA HYATT-NATIONAL UNION OF
WORKERS IN THE HOTEL AND RESTAURANT AND ALLIED INDUSTRIES
(SAMASAH-NUWHRAIN), G.R. No. 165756, June 5, 2009)

Also, SMC cannot take refuge in the Receipt and Release

document signed by the respondent. Generally, deeds of release,
waivers, or quitclaims cannot bar employees from demanding benefits
to which they are legally entitled or from contesting the legality of their
dismissal, since quitclaims are looked upon with disfavor and are
frowned upon as contrary to public policy. Where, however, the person
making the waiver has done so voluntarily, with a full understanding
thereof, and the consideration for the quitclaim is credible and
reasonable, the transaction must be recognized as a valid and binding
undertaking. The burden of proving that the quitclaim or waiver was
voluntarily entered into rests on the employer. (SAN MIGUEL
CORPORATION v. EDUARDO L. TEODOSIO, G.R. No. 163033, October 2,
2009)

Real Party in Interest

To qualify a person to be a real party in interest in whose name

an action must be prosecuted, he must appear to be the present real
holder of the right sought to be enforced. “Interest” within the
meaning of the rule means material interest, an interest in essence to
be affected by the judgment as distinguished from mere interest in the
question involved, or a mere incidental interest. By real interest is
meant a present substantial interest, as distinguished from a mere
expentancy or a future, contingent, subordinate or consequential
interest. (NORTHEASTERN COLLEGE TEACHERS AND EMPLOYEES
ASSOCIATION vs. NORTHEASTERN COLLEGE, INC., G.R. No. 152923,
January 19, 2009)

It has been repeatedly stated that the Pantranco properties which

were the subject of execution sale were owned by Macris and later,
the PNB-Madecor. They were never owned by PNEI or PNB.
Following our earlier discussion on the separate personalities of the

52
 different corporations involved in the instant case, the only entity
which has the right and interest to question the execution sale and
the eventual right to annul the same, if any, is PNB-Madecor or its
successor-in-interest. Settled is the rule that proceedings in court
must be instituted by the real party in interest. (PANTRANCO
EMPLOYEES ASSOCIATION (PEA-PTGWO) and PANTRANCO
RETRENCHED EMPLOYEES ASSOCIATION (PANREA) v. NATIONAL
LABOR RELATIONS COMMISSION (NLRC), G.R. No. 170689, G.R. No.
170705)

Re-computation of Awards

Furthermore, the CA sufficiently explained the need to increase

the award of 13th month pay and SIL pay. It modified the award after
finding that the computation of the amount given by the NLRC in its
Decision dated March 25, 2002 does not conform to the dismissed
employees’ employment history. The CA aptly explained, viz.:

A cursory reading of the assailed Decision of the

NLRC dated March 25, 2002 readily reveals that the labor
tribunal awarded private respondents their unpaid 13th
Month Pay and Service Incentive Leave (SIL) Pay without
regard to their employment history with the petitioner.
There was even no explanation or adequate showing on
the face of the questioned judgment why the award of the
unpaid 13th Month and SIL Pay differs from one private
respondent to another. This Court, therefore, after
determining that indeed the petitioner had not paid the
private respondents these special benefits for the whole
period of their employment therewith, modified the award
by painstakingly basing it to each of the dismissed
employee’s employment history with petitioner.

xxxx

The procedural lapse on the part of the NLRC in this

case in failing to take into account the number of years
when the private respondents did not receive their 13 th
Month and SIL Pay cannot defeat their right to receive
these benefits as granted under substantive law. This
Court simply could not uphold an erroneous computation of
the said unpaid benefits. Hence, it had to re-compute, and
as a consequence, increased it.

53
(AKLAN COLLEGE, INC. vs. PERPETUO ENERO, ARLYN CASTIGADOR,
NUENA SERMON and JOCELYN ZOLINA, G.R. No. 178309, January 27,
2009)

Recruitment Agency

As the Court previously observed, the Contract of Services

between Interserve and petitioner did not identify the work needed to
be performed and the final result required to be accomplished.
Instead, the Contract specified the type of workers Interserve must
provide petitioner (“Route Helpers, Salesmen, Drivers, Clericals,
Encoders & PD”) and their qualifications (technical/vocational course
graduates, physically fit, of good moral character, and have not been
convicted of any crime). The Contract also states that, “to carry out
the undertakings specified in the immediately preceding paragraph,
the CONTRACTOR shall employ the necessary personnel,” thus,
acknowledging that Interserve did not yet have in its employ the
personnel needed by petitioner and would still pick out such personnel
based on the criteria provided by petitioner. In other words, Interserve
did not obligate itself to perform an identifiable job, work, or service for
petitioner, but merely bound itself to provide the latter with specific
types of employees. These contractual provisions strongly indicated
that Interserve was merely a recruiting and manpower agency
providing petitioner with workers performing tasks directly related to
the latter’s principal business. (COCA-COLA BOTTLERS PHILS., INC v.
ALAN M. AGITO, et al., G.R. No. 179546, February 13, 2009)

Refusal to Return to Work

Therefore, the complaint for illegal dismissal filed by respondents

was premature, since even after the expiration of their suspension
period, they refused, despite due notice, to report to work. In fact, in
their Memorandum of Appeal, respondents admitted having received
petitioners’ return-to-work memorandum which, however, became
futile because they hastily filed the complaint for illegal dismissal.
(INDUSTRIAL & TRANSPORT EQUIPMENT, INC. RAYMOND JARINA, vs.
TOMAS TUGADE and CRESENCIO TUGADE, G.R. No. 158539, January
15, 2009)

Regular Employment

Undoubtedly, respondents were regular employees of petitioner

with respect to the escort or “comboy” activity for which they had

54
been engaged since 1993 and 1994, respectively, without regard to
continuity or brokenness of the service. (DEALCO FARMS, INC., vs.
NATIONAL LABOR RELATIONS COMMISSION (5th DIVISION), G.R. No.
153192 January 30, 2009)

Thus, there are two kinds of regular employees, namely: (1)

those who are engaged to perform activities which are usually
necessary or desirable in the usual business or trade of the employer;
and (2) those who have rendered at least one year of service, whether
continuous or broken, with respect to the activity in which they are
employed. Simply stated, regular employees are classified into (1)
regular employees - by nature of work and (2) regular employees - by
years of service. The former refers to those employees who perform a
particular activity which is necessary or desirable in the usual business
or trade of the employer, regardless of their length of service; while
the latter refers to those employees who have been performing the
job, regardless of the nature thereof, for at least a year. If the
employee has been performing the job for at least one year, even if the
performance is not continuous or merely intermittent, the law deems
the repeated and continuing need for its performance as sufficient
evidence of the necessity, if not indispensability, of that activity to the
business. (SAN MIGUEL CORPORATION v. EDUARDO L. TEODOSIO, G.R.
No. 163033, October 2, 2009)

Reinstatement

The spirit of the rule on reinstatement pending appeal animates

the proceedings once the Labor Arbiter issues the decision containing
an order of reinstatement. The immediacy of its execution needs no
further elaboration. Reinstatement pending appeal necessitates its
immediate execution during the pendency of the appeal, if the law is to
serve its noble purpose. At the same time, any attempt on the part of
the employer to evade or delay its execution, as observed in
Panuncillo and as what actually transpired in Kimberly, Composite, Air
Philippines, and Roquero, should not be countenanced.

After the labor arbiter’s decision is reversed by a higher tribunal,

the employee may be barred from collecting the accrued wages, if it is
shown that the delay in enforcing the reinstatement pending appeal
was without fault on the part of the employer. (JUANITO A. GARCIA and
ALBERTO J. DUMAGO vs. PHILIPPINE AIRLINES, INC., G.R. No. 164856,
January 20, 2009)

• Reinstatement during Corporate Rehabilitation

55
 Case law recognizes that unless there is a restraining order, the
implementation of the order of reinstatement is ministerial and
mandatory. This injunction or suspension of claims by legislative fiat
partakes of the nature of a restraining order that constitutes a legal
justification for respondent’s non-compliance with the reinstatement
order. Respondent’s failure to exercise the alternative options of
actual reinstatement and payroll reinstatement was thus justified.
Such being the case, respondent’s obligation to pay the salaries
pending appeal, as the normal effect of the non-exercise of the
options, did not attach. (JUANITO A. GARCIA and ALBERTO J. DUMAGO
vs. PHILIPPINE AIRLINES, INC., G.R. No. 164856, January 20, 2009)

Republic Act No. 8042

• Fifth Paragraph of Section 10; Unconstitutional

The argument of the Solicitor General, that the actual purpose of

the subject clause of limiting the entitlement of OFWs to their three-
month salary in case of illegal dismissal, is to give them a better
chance of getting hired by foreign employers. This is plain speculation.
As earlier discussed, there is nothing in the text of the law or the
records of the deliberations leading to its enactment or the pleadings
of respondent that would indicate that there is an existing
governmental purpose for the subject clause, or even just a pretext of
one.

The subject clause does not state or imply any definitive

governmental purpose; and it is for that precise reason that the clause
violates not just petitioner's right to equal protection, but also her right
to substantivedue process under Section 1, Article III of the
Constitution. (ANTONIO M. SERRANO v. GALLANT MARITIME
SERVICES,INC. and MARLOW NAVIGATION CO., INC., G.R. No. 167614,
March 24, 2009)

Retirement Coverage

A twist in Rivera’s case is that she continued working beyond the

compulsory separation from service that resulted from her retirement.
Whether she could or could not resume working with the company is,
as a rule, a consensual matter for the parties to agree upon, limited
only by company policies and the applicable terms of the retirement

56
plan. To be sure, there is no limitation by law that barred her from
continuing her work with UNILAB; even the above-quoted
Implementing Rules, in setting the retirement age at 60, deferred to
the parties’ agreement. Her employment terms under this renewed
employment are based on what she and the company agreed upon.
Whether these terms included renewed coverage in the retirement
plan is an evidentiary gap that could have been conclusively shown by
evidence of deductions of contributions to the plan after 1988. Two
indicators, however, tell us that no such coverage took place. The first
is that the terms of the retirement plan, before and after its 1992
amendment, continued to exclude those who have rendered 30 years
of service or have reached 60 years of age. Therefore, the plan could
not have covered her. The second is the absence of evidence of, or of
any demand for, any reimbursement of what Rivera would have paid
as contributions to the plan had her coverage and deductions
continued after 1988. Thus, we conclude that her renewed service did
not have the benefit of any retirement plan coverage. (JANUARIA A.
RIVERA v. UNITED LABORATORIES, INC.,G.R. No. 155639 April 22,
2009)

Seafarer
• Death Benefits
The general rule is that the employer is liable to pay the heirs of
the deceased seafarer for death benefits once it is established that he
died during the effectivity of his employment contract. However, the
employer may be exempted from liability if he can successfully prove
that the seafarer’s death was caused by an injury directly attributable
to his deliberate or willful act. In sum, respondents’ entitlement to any
death benefits depends on whether the evidence of the petitioners
suffices to prove that the deceased committed suicide; the burden of
proof rests on his employer. (GREAT SOUTHERN MARITIME SERVICES
CORP. and IMC SHIPPING CO., PTE. LTD. v. LEONILA SURIGAO for
Herself and In Behalf of Her Minor Children,Namely KAYE ANGELI and
MIRIAM,Both Surnamed SURIGAO G.R. No. 183646)

• Post-Employment Medical Examination

But even assuming that petitioner was repatriated for medical
reasons, he failed to submit himself to the company-designated doctor
in accordance with the post-employment medical examination
requirement under the above-quoted paragraph 3 of Section 20(B) of
the POEA Standard Employment Contract. Failure to comply with this
requirement which is a sine qua non bars the filing of claim for
disability benefits. (DIONISIO M. MUSNIT v. SEA STAR SHIPPING
CORPORATION , G.R. No. 182623, December 4, 2009)

57
Security Guard
“Temporary off–detail”

Petitioner’s citation of Article 286 of the Labor Code

reading:

ART. 286. When employment not deemed

terminated. ─ The bona fide suspension of the operation of
a business or undertaking for a period not exceeding six
(6) months, or the fulfillment by the employee of a military
or civic duty shall not terminate employment. In all such
cases, the employer shall reinstate the employee to his
former position without loss of seniority rights if he
indicates his desire to resume his work not later than one
(1) month from the resumption of operations of his
employer or from his relief from the military or civic duty.
(Emphasis in the original; underscoring supplied)

is misplaced. Philippine Industrial Security Agency v. Dapiton

teaches:

We stress that Article 286 applies only when there is a

bonafide suspension of the employer’s operation of a
business or undertaking for a period not exceeding six (6)
months. In such a case, there is no termination of
employment but only a temporary displacement of
employees, albeit the displacement should not exceed six
(6) months. The paramount consideration should be the
dire exigency of the business of the employer that compels
it to put some of its employees temporarily out of work. In
security services, the temporary “off-detail” of guards
takes place when the security agency’s clients decide not
to renew their contracts with the security agency, resulting
in a situation where the available posts under its existing
contracts are less than the number of guards in its roster.
(Underscoring supplied)

In the present case, there is no showing that there was lack of

available posts at petitioner’s clients or that there was a request
from the client-bank, where respondent was last posted and which

58
 continued to hire petitioner’s services, to replace respondent with
another. Petitioner suddenly prevented him from reporting on his
tour of duty at the bank on December 15, 2001 and had not
thereafter asked him to report for duty. (EAGLE STAR SECURITY
SERVICES, INC. v. BONIFACIO L. MIRANDO, G.R. No. 179512, July 30,
2009)

Separate Corporate Personality

Assuming, for the sake of argument, that PNB may be held liable
for the debts of PNEI, petitioners still cannot proceed against the
Pantranco properties, the same being owned by PNB-Madecor,
notwithstanding the fact that PNB-Madecor was a subsidiary of
PNB. The general rule remains that PNB-Madecor has a personality
separate and distinct from PNB. The mere fact that a corporation
owns all of the stocks of another corporation, taken alone, is not
sufficient to justify their being treated as one entity. If used to
perform legitimate functions, a subsidiary’s separate existence
shall be respected, and the liability of the parent corporation as
well as the subsidiary will be confined to those arising in their
respective businesses. (PANTRANCO EMPLOYEES ASSOCIATION
(PEA-PTGWO) and PANTRANCO RETRENCHED EMPLOYEES
ASSOCIATION (PANREA) v. NATIONAL LABOR RELATIONS
COMMISSION (NLRC), G.R. No. 170689, G.R. No. 170705)

Separation Pay

Since petitioner was not faultless in regard to the offenses imputed

against her, we hold that the award of separation pay only, without
backwages, is proper. (ELIZABETH D. PALTENG v. UNITED
COCONUT PLANTERS BANK, G.R. No. 172199, February 27, 2009)

We thus find the dismissal to be illegal. Consequently,

respondent is entitled to reinstatement without loss of seniority rights
and other privileges, and to full backwages, inclusive of allowances,
and other benefits or their monetary equivalent, computed from the
time of the withholding of the employee's compensation up to the time
of actual reinstatement. If reinstatement is not possible due to the
strained relations between the employer and the employee, separation
pay should instead be paid the employee equivalent to one month
salary for every year of service, computed from the time of
engagement up to the finality of this decision. (M+W ZANDER
PHILIPPINES, INC. and ROLF WILTSCHEK v. TRINIDAD M. ENRIQUEZ,
G.R. No. 169173, June 5, 2009)

59
 Article 279 of the Labor Code provides that “[a]n employee who
is unjustly dismissed from work shall be entitled to reinstatement
without loss of seniority rights and other privileges and to his full
backwages, inclusive of allowances, and to his other benefits or their
monetary equivalent computed from the time his compensation was
withheld from him up to the time of his actual reinstatement.” Since,
in the present case, reinstatement is no longer practicable or feasible,
separation pay may be awarded in lieu of reinstatement. Moreover,
the awards of separation pay and backwages are not mutually
exclusive and both may be given to Tagulao and Serrano.

The normal consequences of a finding that an employee has

been illegally dismissed are, firstly, that the employee becomes
entitled to reinstatement to his former position without loss of seniority
rights and, secondly, the payment of backwages corresponding to the
period from his illegal dismissal up to actual reinstatement. The
statutory intent on this matter is clearly discernible. Reinstatement
restores the employee who was unjustly dismissed to the position from
which he was removed, that is, to his status quo ante dismissal, while
the grant of backwages allows the same employee to recover from the
employer that which he had lost by way of wages as a result of his
dismissal. These twin remedies —reinstatement and payment of
backwages — make the dismissed employee whole who can then look
forward to continued employment. Thus do these two remedies give
meaning and substance to the constitutional right of labor to security
of tenure. The two forms of relief are distinct and separate, one from
the other. Though the grant of reinstatement commonly carries with it
an award of backwages, the inappropriateness or non-availability of
one does not carry with it the inappropriateness or non-availability of
the other. x x x As the term suggests, separation pay is the amount
that an employee receives at the time of his severance from the
service and x x x is designed to provide the employee with “the
wherewithal during the period that he is looking for another
employment.” In the instant case, the grant of separation pay was a
substitute for immediate and continued re-employment with the
private respondent Bank. The grant of separation pay did not redress
the injury that is intended to be relieved by the second remedy of
backwages, that is, the loss of earnings that would have accrued to the
dismissed employee during the period between dismissal and
reinstatement. Put a little differently, payment of backwages is a form
of relief that restores the income that was lost by reason of unlawful
dismissal; separation pay, in contrast, is oriented towards the
immediate future, the transitional period the dismissed employee must
undergo before locating a replacement job. x x x The grant of
separation pay was a proper substitute only for reinstatement; it could
not be an adequate substitute both for reinstatement and for

60
backwages. (Emphasis added) (NISSAN NORTH EDSA BALINTAWAK,
QUEZON CITY v. ANGELITO SERRANO, JR. and EDWIN TAGULAO, G.R.
No. 162538, June 4, 2009)

Above all, the intention to sever the employer-employee

relationship was not duly established by respondents. The prior
submission of a medical certificate that petitioner is fit to resume work
negates the claim of respondents that the former demanded for
separation pay on account of her failing health. Certainly, petitioner
cannot demand for separation benefits on the ground of illness while at
the same time presenting a certification that she is fit to work.
Respondents could have denied petitioner’s demand at that instance
and ordered her to return to work had it not been their intention to
sever petitioner from their employ. Hence, we find the allegation that
petitioner presented herself for work but was refused by respondents
more credible. (CONCEPCION FAELDONIA v. TONG YAK
GROCERIES,JAYME GO and MERLITA GO,G.R. No. 182499, October 2,
2009)

Since Dusit Hotel is explicitly mandated by the afore-quoted

statutory provision to pay its employees and management their
respective shares in the service charges collected, the hotel cannot
claim that payment thereof to its 82 employees constitute substantial
compliance with the payment of ECOLA under WO No. 9. Undoubtedly,
the hotel employees’ right to their shares in the service charges
collected by Dusit Hotel is distinct and separate from their right to
ECOLA; gratification by the hotel of one does not result in the
satisfaction of the other. (PHILIPPINE HOTELIERS, INC., DUSIT HOTEL
NIKKO-MANILA v. NATIONAL UNION OF WORKERS IN HOTEL,
RESTAURANT, AND ALLIED INDUSTRIES (NUWHRAIN-APL-IUF)- DUSIT
HOTEL NIKKO CHAPTER, G.R. No. 181972, August 25, 2009)

Social Justice

The Court is not unmindful of the equally important right of

respondent as employer under the Constitution to be protected in its
property and interest. The particular circumstances attendant in this
case, however, convince the Court that the supreme penalty of
dismissal upon petitioner is not justified. The law regards the workers
with compassion. Even where a worker has committed an infraction of
company rules and regulations, a penalty less punitive than dismissal
may suffice. This is not only because of the law's concern for the
workingman. There is, in addition, his family to consider.
Unemployment brings untold hardships and sorrows on those

61
dependent upon the wage-earner. (ABELARDO P. ABEL v. PHILEX
MINING CORPORATION, G.R. No. 178976, July 31, 2009)

While the Court commiserates with petitioners on their loss of

employment, especially now that the Cooperative is no longer a going
concern, it cannot simply, by default, hold the Cooperative’s co-
respondents liable for their claims without any factual and legal
justification therefor. The social justice policy of labor laws and the
Constitution is not meant to be oppressive of capital. (OLDARICO S.
TRAVEÑO, et al v. BOBONGON BANANA GROWERS MULTI-PURPOSE
COOPERATIVE, TIMOG AGRICULTURAL CORPORATION, DIAMOND
FARMS, INC., and DOLE ASIA PHILIPPINES, G.R. No. 164205,
September 3, 2009)

In the present case, respondent had been employed with the

petitioner for almost twelve (12) years. On February 13, 1996, he
suffered from a “fractured left transverse process of fourth lumbar
vertebra,” while their vessel was at the port of Yokohama, Japan. After
consulting a doctor, he was required to rest for a month. When he was
repatriated to Manila and examined by a company doctor, he was
declared fit to continue his work. When he reported for work, petitioner
refused to employ him despite the assurance of its personnel manager.
Respondent patiently waited for more than one year to embark on the
vessel as 2rd Engineer, but the position was not given to him, as it was
occupied by another person known to one of the stockholders.
Consequently, for having been deprived of continued employment with
petitioner's vessel, respondent opted to apply for optional retirement.
In addition, records show that respondent's seaman's book, as duly
noted and signed by the captain of the vessel was marked “Very
Good,” and “recommended for hire.” Moreover, respondent had no
derogatory record on file over his long years of service with the
petitioner.
Considering all of the foregoing and in line with Eastern, the ends
of social and compassionate justice would be served best if respondent
will be given some equitable relief. Thus, the award of P100,000.00 to
respondent as financial assistance is deemed equitable under the
circumstances.( EASTERN SHIPPING LINES, INC V. FERRER D. ANTONIO
G.R. No. 171587, October 13, 2009)

Petitioners’ bare invocation of “the interest of substantial justice”

does not lie.” Only under exceptionally meritorious cases may a
relaxation from an otherwise stringent rule be allowed “to relieve a
litigant of an injustice not commensurate with the degree of
thoughtlessness in not complying with the procedure prescribed”– the
existence of which petitioners failed to demonstrate. (WALLEM

62
MARITIME SERVICES, INC. and SCANDIC SHIPMANAGEMENT LIMITED v.
ERIBERTO S. BULTRON, G.R. No. 185261, October 2, 2009)

Strike

• Illegal Strike

The use of unlawful means in the course of a strike renders such

strike illegal. Therefore, pursuant to the principle of conclusiveness of
judgment, the March 9, 1998 strike was ipso facto illegal. The filing of a
petition to declare the strike illegal was thus unnecessary. (JACKBILT
INDUSTRIES, INC.v. JACKBILT EMPLOYEESWORKERS UNION-NAFLU-
KMU,G.R. Nos. 171618-19, March 20, 2009)

• Dinopol and Lustria Decision

There is no conflict between the Dinopol and the Lustria

decisions. While both rulings involve the same parties and same
issues, there is a distinction between the remedies sought by the
parties in these two cases. In the Dinopol decision, it was QCSC which
filed a petition to declare the illegality of the 12 August 1997 strike by
the union. The consequence of the declaration of an illegal strike is
termination from employment, which the Labor Arbiter did so rule in
said case. However, not all union members were terminated. In fact,
only a few union officers were validly dismissed in accordance with
Article 264 of the Labor Code. Corollarily, the other union members
who had merely participated in the strike but had not committed any
illegal acts were not dismissed from employment. Hence, the NLRC
erred in declaring the employment status of all employees as having
been lost or forfeited by virtue of the Dinopol decision.

On the other hand, the Lustria decision involved the unfair labor
practices alleged by the union with particularity. In said case, Labor
Arbiter Lustria sided with the Union and found QCSC guilty of such
practices. As a consequence, the affected employees were granted
backwages and separation pay. The grant of backwages and
separation pay however was not premised on the declaration of the
illegality of the strike but on the finding that these affected employees
were constructively dismissed from work, as evidenced by the layoffs
effected by the company. As explained in the Lustria decision:

Considering that the temporary lay-off of listed

employees effected by the respondents on 16 August 1997
was without documentary evidence to determine its
validity, it is our considered view and we so hold that said
employees were constructively dismissed without just or

63
 authorized cause and observance of due process. This
opinion finds support from the hard and cold fact of
absence of prior notice, report with the regional office of
the Department of Labor and Employment having
jurisdiction over the area and they remain under lay-off
status of employment. In conclusion, they are entitled to
backwages and separation pay in lieu of reinstatement as
prayed.

Clearly, there are two separate decisions issued by two different

labor arbiters involving the same parties and interests. Considering
that the remedies sought by the parties in each case differ, these two
rulings may co-exist. (LOLITA A. LOPEZ, ET. al., vs. QUEZON CITY
SPORTS CLUB, INC.,G.R. No. 164032, January 19, 2009)

Substitution of Parties

Finally, as to the prayer of the counsel of Mr. Gumarang to allow

the latter to be substituted by his wife, and by his former co-employees
whom he had allegedly represented before the Regional Arbitration
Branch of the NLRC, we grant the same insofar as the wife is
concerned, she being his heir, but not as to the other co-employees.
We cannot allow petitioner Gumarang’s co-employees to take his place
because, if we do, we would be allowing them to become parties to the
instant petition when they are not. It would have been different if they
presented evidence showing that they had authorized Mr. Gumarang to
file the petition on their behalf before this Court and even before the
Court of Appeals. This, they had not done. (NORTHEASTERN
COLLEGE TEACHERS AND EMPLOYEES ASSOCIATION vs.
NORTHEASTERN COLLEGE, INC., G.R. No. 152923, January 19, 2009)

Suspension

Thus, the CA and the NLRC correctly observed that the worst that
respondent committed was an inadvertent infraction. For that, the
extreme penalty of dismissal imposed on him by petitioners was
grossly disproportionate. Taking into account the managerial position
he held and the prior warning issued to him for failing to communicate
with his superiors, the penalty commensurate to the violation he
committed should be suspension for three months. The period of his
suspension is to be deducted from the period for which he is entitled to
backwages as awarded by the NLRC and affirmed by the CA. (GULF
AIR, JASSIM HINDRI ABDULLAH and RESTY AREVALO v. NATIONAL
LABOR RELATIONS COMMISSION and ROBERTO J.C. REYES, G.R. No.
159687, April 24, 2009)

64
Teachers

• Employment Status

The common practice is for the employer and the teacher to

enter into a contract, effective for one school year. At the end of the
school year, the employer has the option not to renew the contract,
particularly considering the teacher’s performance. If the contract is
not renewed, the employment relationship terminates. If the contract
is renewed, usually for another school year, the probationary
employment continues. Again, at the end of that period, the parties
may opt to renew or not to renew the contract. If renewed, this second
renewal of the contract for another school year would then be the last
year – since it would be the third school year – of probationary
employment. At the end of this third year, the employer may now
decide whether to extend a permanent appointment to the employee,
primarily on the basis of the employee having met the reasonable
standards of competence and efficiency set by the employer. For the
entire duration of this three-year period, the teacher remains under
probation. Upon the expiration of his contract of employment, being
simply on probation, he cannot automatically claim security of tenure
and compel the employer to renew his employment contract. It is
when the yearly contract is renewed for the third time that Section 93
of the Manual becomes operative, and the teacher then is entitled to
regular or permanent employment status. (MAGIS YOUNG
ACHIEVERS’ LEARNING CENTER and MRS. VIOLETA T. CARIÑO v.
ADELAIDA MANALO, G.R. No. 178835, February 13, 2009 )

• Probationary Period for Teachers

Thus, in light of our ruling of Espiritu Santo Parochial School v.

NLRC that, in the absence of an express period of probation for private
school teachers, the three-year probationary period provided by the
Manual of Regulations for Private Schools must apply likewise to the
case of respondent. In other words, absent any concrete and
competent proof that her performance as a teacher was unsatisfactory
from her hiring on April 18, 2002 up to March 31, 2003, respondent is
entitled to continue her three-year period of probationary period, such
that from March 31, 2003, her probationary employment is deemed
renewed for the following two school years. (MAGIS YOUNG
ACHIEVERS’ LEARNING CENTER and MRS. VIOLETA T. CARIÑO v.
ADELAIDA . MANALO, G.R. No. 178835, February 13, 2009 )

Termination of Employment

65
Just
Causes

• Neglect of Duty/Abandonment

Hence, we find it hard to believe that he will just abandon his job
after petitioners gave him a chance to continue working for them. We
uphold the following findings of the Court of Appeals that respondent
did not abandon his job:

In the case at bar, the charge of abandonment is

belied by the following circumstances: First, the high
improbability of private respondent to intentionally
abandon his work considering that he had already served a
penalty of suspension for his infractions and violations as
well as the petitioner’s tacit condonation of the infractions
he committed, by permitting him to go back to work and
by asking him to execute a promissory note. It is
incongruent to human nature, that after having ironed
things out with his employer, an employee would just not
report for work for no apparent reason. Secondly, there
was no proof that petitioner sent private respondent a
notice of termination on the ground of abandonment, if
indeed it is true that he really failed to go back to work.
Section 2, Rule XVI, Book V, Rules and regulations
implementing the Labor Code provides that any employer
who seeks to dismiss a worker shall furnish him a written
notice stating the particular act or omission constituting
the ground for his dismissal. In cases of abandonment of
work, the notice shall be served at the worker’s last known
address (Icawat vs. National Labor Relations Commission,
334 SCRA 75, 81 [2000]). For this reason, We are
constrained to give credence to private respondent’s
assertion that he attempted to report back to work but he
was just asked to leave as he was considered terminated.
And lastly, private respondent’s filing of a case for illegal
dismissal with the labor arbiter negates abandonment. As
held by the Supreme Court, a charge of abandonment is
totally inconsistent with the immediate filing of a complaint
for illegal dismissal, more so when it includes a prayer for
reinstatement (Globe Telecom, Inc. vs Florendo-Flores, 390
SCRA 201, 2002[sic]-203 [2002]). (BC CABLE MASTER
SYSTEM AND/OR EVELYN CINENSE vs. MARCIAL BALUYOT,
G.R. No. 172670,January 20, 2009)

66
 In the instant case, respondent was informed by no less than his
immediate superior, the chief cook and by his brother that he was
being terminated. Like the Court of Appeals, the Court finds no reason
why these two would give respondent the false impression that he was
being dismissed, and in turn, the Court, like the appellate court again,
is inclined to believe that they were given prior instruction, or they at
least had prior knowledge of the termination. Moreover, as previously
discussed, the charge of abandonment does not square with the fact
that a week after respondent’s alleged dismissal, he filed a complaint
with the NLRC. (HARBORVIEW RESTAURANT v. REYNALDO LABRO, G.R.
No. 168273, April 30, 2009)

To constitute abandonment, there must be clear proof of

deliberate and unjustified intent to sever the employer-employee
relationship. Clearly, the operative act is still the employee’s ultimate
act of putting an end to his employment. However, an employee who
takes steps to protest her layoff cannot be said to have abandoned her
work because a charge of abandonment is totally inconsistent with the
immediate filing of a complaint for illegal dismissal, more so when it
includes a prayer for reinstatement. When Eleonor filed the illegal
dismissal complaint, it totally negated petitioner’s theory of
abandonment. (SOUTH DAVAO DEVELOPMENT COMPANY, INC. (NOW
SODACO AGRICULTURAL CORPORATION) AND/OR MALONE PACQUIAO
AND VICTOR A. CONSUNJI, v. SERGIO L. GAMO, et. al., G.R. No. 171814,
May 8, 2009)

In petitioners’ case, despite the directive cum caveat of CASI for

them to report back for work within two days from receipt thereof, they
failed to comply therewith. After three years, as reflected above, they
offered to return to work. Their intention to sever the employer-
employee relationship with CASI is manifested, however, by the length
of time they refused to return to work, for they had, in the interim,
been looking for other jobs. (MIGUEL A. PILAPIL, et al. v. NATIONAL
LABOR RELATIONS COMMISSION G.R. No. 178229 October 23, 2009)

Respondents failed to discharge this burden. Mere absence of

petitioner is not sufficient to establish the allegation of abandonment.
The prolonged absence of petitioner was not without justifiable reason
because it was established that her failure to report for work was due
to the injury she suffered in the course of her employment and with
sufficient notice to respondents. Petitioner also presented herself for
work on the date stated in the medical certificate which stated that she
is fit to resume work. (CONCEPCION FAELDONIA v. TONG YAK
GROCERIES,JAYME GO and MERLITA GO,G.R. No. 182499, October 2,
2009)

67
 Furthermore, the Court agrees with respondents when they
argued in their petition filed with the CA that if an employee's aim is to
secure the benefits due him from his employer, abandonment would
surely be an illogical and impractical recourse, especially for simple
laborers such as respondent Aguilar. Considering the difficult times in
which our country is in it is illogical and even suicidal for an employee
like Aguilar to abandon his work, knowing fully well of the widespread
unemployment and underemployment problems as well as the
difficulty of looking for a means of livelihood, simply because his
employer rejected his demand for salary increase. Under the given
facts, no basis in reason exists for the petitioners' theory that Aguilar
abandoned his job. (BARON REPUBLIC THEATRICAL V. NORMITA P.
PERALTA et al, G.R. No. 170525, October 2, 2009)

• Gross Negligence

An employer cannot legally be compelled to continue with the

employment of a person admittedly guilty of gross negligence in the
performance of his duties. This holds true specially if the employee’s
continued tenure is patently inimical to the employer’s interest. What
happened was not a simple case of oversight and could not be
attributed to a simple lapse of judgment. No amount of good intent, or
previous conscientious performance of duty, can assuage the damage
Mateo caused LBC when he failed to exercise the requisite degree of
diligence required of him under the circumstances.( LBC EXPRESS –
METRO MANILA, INC. and LORENZO A. NIÑO v. JAMES MATEO, G.R. No.
168215, June 9, 2009)

To warrant removal from service, the negligence should not

merely be gross but also habitual. Gross negligence implies a want or
absence of or failure to exercise even slight care or diligence, or the
entire absence of care. It evinces a thoughtless disregard of
consequences without exerting any effort to avoid them. Habitual
neglect implies repeated failure to perform one's duties for a period of
time, depending upon the circumstances. The single or isolated act of
negligence does not constitute a just cause for the dismissal of the
employee. (ABELARDO P. ABEL v. PHILEX MINING CORPORATION, G.R.
No. 178976, July 31, 2009)

• Serious Misconduct

PNB may rightfully terminate Maralit’s services for a just cause,

including serious misconduct. Serious misconduct is improper conduct,
a transgression of some established and definite rule of action, a
forbidden act, or a dereliction of duty. Having been dismissed for a
just cause, Maralit is not entitled to her retirement benefits. (ESTER B.

68
MARALIT v. PHILIPPINE NATIONAL BANK, G.R. No. 163788, August 24,
2009)

By sleeping on the job and leaving his work area without prior
authorization, Tomada did not merely disregard company rules.
Tomada, in effect, issued an open invitation for others to violate those
same company rules. Indeed, considering the presence of trainees in
the building and Tomada’s acts, Tomada failed to live up to his
company’s reasonable expectations. Tomada’s offenses cannot be
excused upon a plea of being a “first offense,” or have not resulted in
prejudice to the company in any way. No employer may rationally be
expected to continue in employment a person whose lack of morals,
respect and loyalty to his employer, regard for his employer’s rules,
and appreciation of the dignity and responsibility of his office, has so
plainly and completely been bared. (EDUARDO M. TOMADA, SR. v.
RFM CORPORATION-BAKERY FLOUR DIVISION and JOSE MARIA
CONCEPCION III, G.R. No. 163270, September 11, 2009)

Moreover, the peculiar nature of Espadero’s position aggravates

her misconduct. Misconduct has been defined as improper or wrong
conduct; the transgression of some established or definite rule of
action, a forbidden act, a dereliction of duty, willful in character, and
implies wrongful intent and not mere error in judgment. The
misconduct, to be serious, must be of such a grave character and not
merely trivial or unimportant. To constitute just cause for termination,
it must be in connection with the employee’s work. With the degree of
trust expected of Espadero, such infraction can hardly be classified as
one that is trivial or unimportant. Her failure to promptly report the
incident reflects a cavalier regard for the responsibility required of her
in the discharge of the duties of her position. (EATS-CETERA FOOD
SERVICES OUTLET and/or SERAFIN RAMIREZ v. MYRNA B. LETRAN and
MARY GRACE ESPADERO, G.R. No. 179507, October 2, 2009)

An employee who fails to account for and deliver the funds

entrusted to him is liable for misappropriating the same and is
consequently guilty of serious misconduct. Petitioner therefore validly
dismissed respondent.( SUPERLINES TRANSPORTATION COMPANY, INC.
v. EDUARDO PINERA G.R. No. 188742, October 13, 2009)

o Simple Misconduct

Based on the foregoing, we consider respondent’s offense to be

a simple misconduct which does not merit termination of his
employment. The penalty of dismissal from service is not
commensurate to respondent’s offense. Although petitioner, as an

69
employer, has the right to discipline its erring employees, exercise of
such right should be tempered with compassion and understanding.
The magnitude of the infraction committed by an employee must be
weighed and equated with the penalty prescribed and must be
commensurate thereto, in view of the gravity of the penalty of
dismissal or termination from the service. The employer should bear in
mind that in termination cases, what is at stake is not simply the
employee’s job or position but his very livelihood. (PHILIPPINE LONG
DISTANCE TELEPHONE COMPANY v. INOCENCIO B. BERBANO,
JR., G.R. No. 165199, November 27, 2009)

• Loss of Trust and Confidence

Petitioner, in his Position Paper filed before the LA and in his Sagot
na Sinumpaang Salaysay, averred that sometime in August 2004,
Alido informed him of the illegal activities in the company
premises. But this fact was not reflected in his Partial Audit Report;
instead, petitioner made it appear therein that it was upon the
initiative of Lejos that he discovered the illegal activities only on
October 28, 2004, after Lejos already resigned from the company.
The basis for terminating the employment of petitioner actually
came from petitioner himself due to the substantial and
irreconcilable inconsistencies in the narration of facts in his Audit
Report and his Sagot na Sinumpaang Salaysay filed before the
company, and his pleadings before the lower tribunals and before
this Court. In sum, it cannot be denied that he withheld this
information from his immediate supervisor and from the company –
a clear breach of the trust and confidence the company had
reposed in him as one of its Auditors.( ROMEO N. VENTURA, vs.
COURT OF APPEALS, NATIONAL LABOR RELATIONS COMMISSION,
GENUINO ICE CO., INC., and HECTOR GENUINO, G.R. No. 182570,
January 27, 2009

Indeed, by obtaining an altered police report and medical

certificate, petitioners deliberately attempted to cover up the fact that
Sales was under the influence of liquor at the time the accident took
place. In so doing, they committed acts inimical to respondent’s
interests. They thus committed a work-related willfull breach of the
trust and confidence reposed in them. (ERIC DELA CRUZ and RAUL M.
LACUATA v. COCA-COLA BOTTLERS PHILS. INC., G.R. No. 180465, July
31, 2009)

The amount misappropriated by petitioner Manliclic is irrelevant.

More than the resulting material damage or prejudice, it is petitioner
Manliclic’s very act of misappropriation that is offensive to respondent
PELCO I. If taxes are the lifeblood of the state, then, by analogy, the

70
payment collection is the lifeblood of the cooperative. The collection
provides respondent PELCO I with the financial resources to continue
its operations. Respondent PELCO I cannot afford to continue in its
employ dishonest bill collectors.

By his own admission, petitioner Manliclic committed a breach of

the trust reposed in him by his employer, respondent PELCO I. This
constitutes valid cause for his dismissal from service. (CHONA ESTACIO
and LEOPOLDO MANLICLIC v. PAMPANGA I ELECTRIC COOPERATIVE,
INC., and LOLIANO E. ALLAS, G.R. No. 183196, August 19, 2009)

We are not unmindful of the employer’s right to dismiss an

employee based on fraud or willful breach of trust. However, the loss
of confidence must be based not on an ordinary breach by the
employee of the trust reposed in him by the employer, but, in the
language of Article 282(c) of the Labor Code, on a willful breach. A
breach is willful if it is done intentionally, knowingly and purposely,
without justifiable excuse, as distinguished from an act done
carelessly, thoughtlessly, heedlessly, or inadvertently. It must rest on
substantial grounds and not on the employer’s arbitrariness, whims,
caprices or suspicion; otherwise, the employee would eternally remain
at the mercy of the employer. It should be genuine and not simulated;
nor should it appear as a mere afterthought to justify an earlier action
taken in bad faith or as a subterfuge for causes that are improper,
illegal or unjustified. It has never been intended to afford an occasion
for abuse because of its subjective nature. There must, therefore, be
an actual breach of duty committed by the employee, which must be
established by substantial evidence. In this case, SLMC utterly failed
to establish the requirements prescribed by law and jurisprudence for
a valid dismissal on the ground of breach of trust and confidence. (ST.
LUKE’S MEDICAL CENTER, INCORPORATED v. JENNIFER LYNNE C.
FADRIGO, G.R. No. 185933, November 25, 2009)

Verily, the actions of Tirazona reflected an obdurate character

that is arrogant, uncompromising, and hostile. By immediately and
unreasonably adopting an adverse stance against PET, she sought to
impose her will on the company and placed her own interests above
those of her employer. Her motive for her actions was rendered even
more questionable by her exorbitant and arbitrary demand for
P2,000,000.00 payable within five days from demand. Her attitude
towards her employer was clearly inconsistent with her position of trust
and confidence. Her poor character became even more evident when
she read what was supposed to be a confidential letter of the legal
counsel of PET to PET officers/directors expressing his legal opinion on
Tirazona’s administrative case. PET was, therefore, fully justified in
terminating Tirazona’s employment for loss of trust and confidence.

71
(MA. WENELITA S. TIRAZONA, vs. PHILIPPINE EDS TECHNO- SERVICE
INC. (PET INC.) AND/OR KEN KUBOTA, MAMORU ONO and JUNICHI
HIROSE, G.R. No. 169712, January 20, 2009)

To recapitulate, the right of an employer to dismiss an employee

on account of loss of trust and confidence must not be exercised
whimsically. To countenance an arbitrary exercise of that prerogative
is to negate the employee’s constitutional right to security of tenure.
In other words, the employer must clearly and convincingly prove by
substantial evidence the facts and incidents upon which loss of
confidence in the employee may be fairly made to rest; otherwise, the
latter’s dismissal will be rendered illegal. (SAN MIGUEL CORPORATION
vs. NATIONAL LABOR RELATIONS COMMISSION AND WILLIAM L.
FRIEND, JR., G.R. No. 153983, May 26, 2009)

Loss of confidence must not be indiscriminately used as a shield

by the employer against a claim that the dismissal of an employee was
arbitrary. Loss of confidence as a just cause for termination of
employment is premised on the fact that the employee concerned
holds a position of responsibility or trust and confidence. He must be
invested with confidence on delicate matters, such as custody handling
or care and protection of the property and assets of the employer.
And, in order to constitute a just cause for dismissal, the act
complained of must be work-related and shows that the employee
concerned is unfit to continue to work for the employer. (ADAM B.
GARCIA v. NATIONAL LABOR RELATIONS COMMISSION (SECOND
DIVISION), LEGAZPI OIL COMPANY, INC., ROMEO F. MERCADO and GUS
ZULUAGA G.R. No. 172854, April 16, 2009)

Considering the foregoing, we find that respondents Apostol and

Opulencia were dismissed by TIPI for a valid and just cause. The
relationship of employer and employee, specially where the employee
has access to the employer’s property, necessarily involves trust and
confidence. Where the rules laid down by the employer to protect its
property are violated by the very employee who is entrusted and
expected to follow and implement the rules, the employee may be
validly dismissed from service. (TRIUMPH INTERNATIONAL(PHILS.),
INC.FIRST DIVISION v. RAMON L. APOSTOL and BEN M. OPULENCIA,
G.R. No. 164423, June 16, 2009)

As Airport Manager, respondent occupies a position of such

extreme sensitivity that the existence of some basis or reasonable
ground for his involvement in any irregularity is enough to destroy the
trust and confidence which petitioner Gulf Air had reposed in him.
However, it is settled that for breach of trust to constitute a valid cause
for dismissal, the same must be willful. Ordinary breach of trust will not

72
suffice. (GULF AIR, JASSIM HINDRI ABDULLAH and RESTY AREVALO v.
NATIONAL LABOR RELATIONS COMMISSION and ROBERTO J.C. REYES,
G.R. No. 159687, April 24, 2009)

The second requisite is that there must be an act that would

justify the loss of trust and confidence. Loss of trust and confidence, to
be a valid cause for dismissal, must be based on a willful breach of
trust and founded on clearly established facts. The basis for the
dismissal must be clearly and convincingly established but proof
beyond reasonable doubt is not necessary. Respondent’s evidence
against petitioner fails to meet this standard. Its lone witness, Lupega,
did not support his affidavit and testimony during the company
investigation with any piece of evidence at all. No other employee
working at respondent’s mine site attested to the truth of any of his
statements. Standing alone, Lupega’s account of the subsidence area
anomaly could hardly be considered substantial evidence. And while
there is no concrete showing of any ill motive on the part of Lupega to
falsely accuse petitioner, that Lupega himself was under investigation
when he implicated petitioner in the subsidence area anomaly makes
his uncorroborated version suspect. (ABELARDO P. ABEL v. PHILEX
MINING CORPORATION, G.R. No. 178976, July 31, 2009)

o Application of the Doctrine of Loss of Trust and

Confidence

Recent decisions of this Court have distinguished the treatment of

managerial employees from that of the rank-and-file personnel, insofar
as the application of the doctrine of loss of trust and confidence is
concerned. Thus, with respect to rank-and-file personnel, loss of trust
and confidence, as ground for valid dismissal, requires proof of
involvement in the alleged events in question, and that mere
uncorroborated assertions and accusations by the employer will not be
sufficient. But as regards a managerial employee, the mere existence
of a basis for believing that such employee has breached the trust of
his employer would suffice for his dismissal. Hence, in the case of
managerial employees, proof beyond reasonable doubt is not required.
It is sufficient that there is some basis for the employer’s loss of trust
and confidence, such as when the employer has reasonable ground to
believe that the employee concerned is responsible for the purported
misconduct, and the nature of his participation therein renders him
unworthy of the trust and confidence demanded of his position.
Nonetheless, the evidence must be substantial and must establish
clearly and convincingly the facts on which the loss of confidence rests
and not on the employer’s arbitrariness, whims, and caprices or
suspicion. (TRIUMPH INTERNATIONAL(PHILS.), INC.FIRST DIVISION v.

73
RAMON L. APOSTOL and BEN M. OPULENCIA, G.R. No. 164423, June 16,
2009)

o Positions of Trust

There are two classes of positions of trust. The first class

consists of managerial employees. They are defined as those vested
with the powers or prerogatives to lay down management policies and
to hire, transfer, suspend, lay-off, recall, discharge, assign or discipline
employees or effectively recommend such managerial actions. The
second class consists of cashiers, auditors, property custodians, etc.
They are defined as those who, in the normal and routine exercise of
their functions, regularly handle significant amounts of money or
property. (ABELARDO P. ABEL v. PHILEX MINING CORPORATION, G.R.
No. 178976, July 31, 2009)

Authorized Causes

• Retrenchment

The proper view, therefore, is that the Sec. 1 criteria qualify the
factors of “seniority and needs of the company” in Sec. 5(c). Stated a
bit differently, Sec. 5(c) should be understood in the light of Sec. 1
which, to stress, provides seniority, efficiency and attitude, job
knowledge and potential, and attendance as among the factors that
should guide the company in choosing the employees to be laid-off or
kept. All other things being equal, a company would necessarily need
to retain those who had rendered dedicated and highly efficient service
and whose knowledge, attendance, and potential hew with company
standards. Any other measure would be senseless in the business
viewpoint. Accordingly, the merit rating used by MMPC based on Sec.
5 in conjunction with and as qualified by the factors provided under
Sec. 1 is fair and reasonable, and, to be sure, well within the
contemplation of the parties’ CBA. In fact, Alfredo, shorn of the
contention that the merit rating is against the CBA, has not shown any
arbitrariness on the part of MMPC in the evaluation, selection, and
retrenchment of employees. (ALFREDO A. MENDROS, JR v. MITSUBISHI
MOTORS PHILS. CORPORATION (MMPC), G.R. No. 169780, February 16,
2009)
Records do not show any criterion adopted or used by petitioner
in dismissing respondent. Respondent was terminated without
considering her seniority. Retrenchment scheme without taking
seniority into account rendered the retrenchment invalid. While
respondent was the third most senior employee among the 7
employees in petitioner's personnel department, she was retrenched

74
while her other co-employees junior than her were either retained in
the Personnel Department or were transferred to other positions in the
company. There was no showing that respondent was offered to be
transferred to other positions.(EMCOR INCORPORATED v. MA. LOURDES
D. SIENES, G.R. No. 152101, September 8, 2009)

At all events, even if the comparative report were to be

considered, the Court is not persuaded on the necessity of resorting to
retrenchment to prevent or minimize actual or imminent business
losses on the part of petitioner. For retrenchment should only be
resorted to when other less drastic means have been tried and found
to be inadequate. So Polymart Paper Industries, Inc. v. NLRC instructs:

. . . [E]ven if business losses were indeed sufficiently proven,

the employer must still prove that retrenchment was
resorted to only after less drastic measures such as
the reduction of both management and rank-and-file
bonuses and salaries, going on reduced time, improving
manufacturing efficiency, reduction of marketing and
advertising costs, faster collection of customer accounts,
reduction of raw materials investment and others, have
been tried and found wanting. (Emphasis supplied)

In the case at bar, petitioner did not adduce evidence to prove

that retrenchment was resorted to because other measures were
undertaken to abate actual or future business losses but thus failed.
(BIO QUEST MARKETING INC. and/or JOSE L. CO v. EDMUND REY, G.R.
No. 181503,September 18, 2009)

• Requirement for Retrenchment

For a valid termination due to retrenchment, the law also

requires that written notices of the intended retrenchment be served
by the employer on the worker and on the DOLE at least one month
before the actual date of the retrenchment. The purpose of this
requirement is to give employees time to prepare for the eventual loss
of their jobs, as well as to give DOLE the opportunity to ascertain the
veracity of the alleged cause of termination. In this case, petitioner
insists that the payment of 30 days salary to respondents in place of
notice was sufficient compliance with the 30-day notice rule. We
cannot agree. Nothing in the law gives petitioner the option to
substitute the required prior written notice with payment of 30 days

75
salary. Indeed, a job is more than the salary it carries. Payment of 30
days salary cannot compensate for the psychological effect or the
stigma of immediately finding one’s self laid off from work. It cannot
be a fully effective substitute for the 30 days’ written notice
requirement by law, especially when, as in this case, no notice was
given to the DOLE. Even as the letters of voluntary acceptance were
dated July 25, 1998, the notices of termination given on July 23, 1998
were effective the following day. In essence, respondents had already
been dismissed before they signed the letters of voluntary acceptance.
Clearly, petitioner deprived respondents of their right to statutory due
process. For this, we affirm the appellate court’s award of nominal
damages to respondents. But, consistent with our ruling in Agabon v.
National Labor Relations Commission, the amount of nominal damages
should be P30,000. We also sustain the award of attorney’s fees as it
is sanctioned by law. (MOBILIA PRODUCTS, INC. v. ALAN G. DEMECILLO,
et al., G.R. No. 170669, February 4, 2009)

• Losses

Third, it bears to state that the aforequoted Art. 283 of the Code
uses the phrase “retrenchment to prevent losses.” The phrase
necessarily implies that retrenchment may be effected even in the
event only of imminent, impending, or expected losses. The employer
need not wait for substantial losses to materialize before exercising
ultimate and drastic option to prevent such losses. In the case at
bench, MMPC was already financially hemorrhaging before finally
resorting to retrenchment. (ALFREDO A. MENDROS, JR v. MITSUBISHI
MOTORS PHILS. CORPORATION (MMPC), G.R. No. 169780, February 16,
2009)

However, apart from petitioner’s bare assertion of reduced

orders from Japan, the only evidence it presented were the letters of
voluntary acceptance of retrenchment, and waivers and quitclaims
signed by respondents. To our mind, these were insufficient to show
that petitioner indeed suffered business losses so serious as to
necessitate the reduction of personnel. We have constantly ruled that
financial statements audited by independent external auditors
constitute the normal method of proof of the profit and loss
performance of a company. Any less exacting standard of proof would
render too easy the abuse of this ground for termination of services of
employees. Petitioner submitted none. Further, let it be clarified that
our ruling in International Hardware, Inc. v. NLRC did not dispense with
the responsibility of the employer to substantiate losses. It merely
exempts the latter from giving notice of retrenchment to its employees
and DOLE. (MOBILIA PRODUCTS, INC. v. ALAN G. DEMECILLO, et al.,
G.R. No. 170669, February 4, 2009)

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Unfair Labor Practice

• Totality of the Conduct Doctrine

Then came the Lustria decision, issued two (2) months later,
finding that QCSC had committed unfair labor practices against the
union and accordingly granting backwages and separation pay in favor
of 112 employees. The Lustria decision emanated from a complaint for
unfair labor practice against QCSC. Culled from the union’s pleadings
were the specific acts committed by QCSC, such as:

1.Insulting of the Union President as evidenced by

the Salaysay of Ma. Cecilia Pangan;
2.Cuddling and treating the minority union with
favor, such as paying their salaries/wages fully and
ahead of the incumbent union and as if it were the
incumbent bargaining agents;
3.Discouraging the members of the incumbent union
from continuing their membership with the
incumbent union as evidenced by the Pinagsamang
Salaysay of Ramiro Espinosa and Ronaldo Q. Lim;
4.Bribing union member and promising promotion if
he will not join the strike as evidenced by the
Salaysay of Bernard Delta;
5.Transferring union members to another job
description;
6.Replacing them with members of minority union
evidenced by Leslie Tamayo’s Salaysay;
7.Subjecting one union member to a very tense
confrontation in the General Manager’s Office after
she commented during the NCMB conference that
the 201 file of the employees are intact, resulting
to her being taken to the hospital for nervous
breakdown; and
8.Requiring the union members to submit another
information sheet, and failure to do so would mean
no payment of their June 16-30, 1997 salary.

Applying the totality of the conduct doctrine, Labor Arbiter

Lustria held that QCSC had committed unfair labor practices. (LOLITA
A. LOPEZ, ET. al., vs. QUEZON CITY SPORTS CLUB, INC.,G.R. No.
164032, January 19, 2009)

Unfair labor practice refers to “acts that violate the workers’

right to organize.” The prohibited acts are related to the workers’ right

77
to self-organization and to the observance of a CBA. Without that
element, the acts, even if unfair, are not unfair labor practices.
(GENERAL SANTOS COCA-COLA PLANT FREE WORKERS UNION-TUPAS
vs. COCA-COLA BOTTLERS PHILS., INC. (GENERAL SANTOS CITY), THE
COURT OF APPEALS and THE NATIONAL LABOR RELATIONS
COMMISSION, G.R. No. 178647)

Here, respondent Union went on strike in the honest belief that

petitioner was committing ULP after the latter decided to downsize its
workforce contrary to the staffing/manning standards adopted by both
parties under a CBA forged only four (4) short months earlier. The
belief was bolstered when the management hired 100 contractual
workers to replace the 48 terminated regular rank-and-file employees
who were all Union members. Indeed, those circumstances showed
prima facie that the hotel committed ULP. Thus, even if technically
there was no legal ground to stage a strike based on ULP, since the
attendant circumstances support the belief in good faith that
petitioner’s retrenchment scheme was structured to weaken the
bargaining power of the Union, the strike, by exception, may be
considered legal. (HOTEL ENTERPRISES OF THE PHILIPPINES, INC.
(HEPI), owner of Hyatt Regency Manila, v. SAMAHAN NG MGA
MANGGAGAWA SA HYATT-NATIONAL UNION OF WORKERS IN THE
HOTEL AND RESTAURANT AND ALLIED INDUSTRIES (SAMASAH-
NUWHRAIN), G.R. No. 165756, June 5, 2009)

Petitioners never substantiated their allegations. In a similar

case, Schering Employees Labor Union (SELU) et al. v. Schering Plough
Corporation, petitioner Sereneo, the president of SELU, charged
respondent with ULP and illegal dismissal because she was in the
process of renegotiating the CBA with respondent when she was
dismissed on the ground of loss of trust and confidence. We said:

Petitioners' accusation of union busting is bereft of any proof. We

scanned the records very carefully and failed to discern any evidence
to sustain such charge.

In Tiu vs. NLRC, we held:

. . . . It is the union, therefore, who had the burden of proof to

present substantial evidence to support its allegations (of unfair labor
practices committed by management).

xxx xxx xxx.

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 . . ., but in the case at bar the facts and the evidence did not
establish even at least a rational basis why the union would wield a
strike based on alleged unfair labor practices it did not even bother to
substantiate during the conciliation proceedings. It is not enough that
the union believed that the employer committed acts of unfair labor
practice when the circumstances clearly negate even a prima facie
showing to warrant such a belief. (RENITA DEL ROSARIO, et al., v.
MAKATI CINEMA SQUARE CORPORATION, G.R. No. 170014, July 3,
2009)
Voluntary Resignation

Finally, respondent claims that in light of the opinion of the

physician in Korea that he had “suspected ischemic heart,” petitioners
affirmed his medical repatriation. As reflected in the immediately
preceding paragraph, however, ischemic heart disease cannot develop
in a short span of time that respondent served as chief cook for
petitioners. In fact, as indicated above, the Gleneagles Maritime
Medical Centre doctor who treated respondent in May 2000 for abscess
in his left hand had noted respondent’s “[h]istory of hypertension for 3
years.” Moreover, the Korean physician did not make any
recommendation as to respondent’s bill of health for petitioners to
assume that he was fit for repatriation.

IN FINE, respondent’s actions show that he voluntarily resigned.

(VIRGEN SHIPPING CORPORATION, CAPT. RENATO MORENTE &
ODYSSEY MARITIME PTE. LTD., NATIONAL LABOR RELATIONS
COMMISSION v. JESUS B. BARRAQUIO, G.R. No. 178127, April 16, 2009)

Work-related Disease

If we found in Seagull Shipmanagement that the different

climates and unpredictable weather, as well as the stress of the job,
had a correlation with the heart disease of a seafarer working as a
radioman on a vessel, then what more in the heart disease of a
seafarer serving as a ship master, a position involving more strain and
pressure? A Tug (boat) Master is primarily tasked to operate tug boats,
a powerful marine vessel that meets large ships out at sea and attach
a line to guide/steer the same into and out of berths. In operating such
a powerful vessel, a Tug Master requires not just a thorough
knowledge of the port environment in which he is operating, but a high
level of skill as well. In fact, in the case at bar, respondent ADAMS
recognized how grueling petitioner Nisda’s job was, according the
latter a month of paid vacation every three months of straight service.
Thus, more than a reasonable connection between the nature of
petitioner Nisda’s job and his Coronary Artery Disease has been

79
established. Petitioner Nisda was able to sufficiently prove, by
substantial evidence, that his Coronary Artery Disease was work-
related, given the arduous nature of his job that caused his disease or,
at least, aggravated any pre-existing condition he might have had.
Respondents Sea Serve and ADAMS, on the other hand, utterly failed
to refute the said connection. (CARLOS N. NISDA v. SEA SERVE
MARITIME AGENCY and KHALIFA A. ALGOSAIBI DIVING AND MARINE
SERVICES, G. R. No. 179177, July 23, 2009)

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