Chateau Royale Sports vs Balba and Costante

G.R. No. 197492

January 18, 2017

Topic: Security of Tenure

Facts: Respondents were Account Managers in the Nasugbu Office and were instructed to forward all
proposals, event orders and contracts for an orderly and systematic booking in the operation of
petitioners business. They however, failed to comply. The management found them to have committed
acts of insubordination and intended to suspend them which was eventually lifted even before
implemented. The respondents filed a complaint of illegal suspension and later amended to constructive
dismissal based on an information of a plan to transfer them to Manila Office as a result of the
resignation of three account managers and the director of sales and marketing in that office.

Issue: Is the intended transfer of the respondents a valid management prerogative or case of
constructive dismissal?

Ruling: It is a valid management prerogative. In a case of constructive dismissal, the burden of prrog iles
in the employer to prove that the transfer of the employee from one area of operation to another was
for a valid cause, like genuine business necessity. In this case, the resignations of the account managers
and the director of sales and marketing in the Manila office caused an immediate need for their
replacements with personnel having proportionate experiences and skills. Those positions are crucial to
the operations and business of the petitioner-employer that necessitates the transfer. Citing, Benguet
Electric Cooperative vs Fianza, the Court ruled that management had the prerogative to determine the
place where the employee is best qualified to serve the business considering his qualifications, training
and performance. Furthermore, although the transfer might be potentially inconvenient for them
because it would put additional expenses being forced to be away from their families, it was neither
unreasonable no oppressive. The transfer would be without demotion in rank or without diminution of
benefits and salaries. Instead, it is an opportunity for eventual career growth. The respondents-
employee having voluntarily affixed their signatures on their letters of appointment, agreed to the
terms and conditions of their employment which includes the prerogative of management to transfer
and re-assign its employees from one job to another as it may deem necessary or advisable.