Republic of the Philippines

SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 200898 June 15, 2015

BROWN MADONNA PRESS INC., THADDEUS ANTHONY A. CABANGON, FORTUNE LIFE INSURANCE
COMPANY (now Fortune General Insurance Corporation) and/or ANTONIO CABANGON CHUA, Petitioners,
vs.
MARIA ROSARIO M. CASAS, Respondent.

DECISION

BRION, J.:

Before the Court is the petition for review on certiorari, 1 filed by petitioners Brown Madonna Press, Inc. (BMPI), Thaddeus
Anthony Cabangon (Cabangon), Fortune Life Insurance Company (now Fortune General Insurance Corporation) and/or Anthony
Cabangon Chua (Cabangon Chua), to challenge the decision and resolution of the Court of Appeals (CA) in CA-G.R. SP No.
116539.

Factual Antecedents

This case sprung from respondent Rosario M. Casas's (Casas) parting of ways with BMPI as its Vice President for Finance and
Administration on January 5; 2007. Casas claims she was forced to leave her work, while the BMPI management asserts that she
requested a graceful exit from the company to avoid an administrative investigation. The facts leading to this dispute are outlined
below.

On May 1, 1984, Casas was hired as an accounting clerk at Fortune General Insurance, a member of the ALC Group of
Companies. She eventually rose from the ranks; on December 1, 2003, she was transferred to BMPI, another ALC member
company, as its Vice President for Finance and Administration. 2

On January 5, 2007, Casas met with Cabangon, BMPI’s company president, and Victoria Nava (Nava), the Vice President for the
Central Human Resource Department of the ALC Group of Companies. During the meeting, Casas was allegedly told not to report
to work anymore starting January 8, 2007, upon the instructions of Cabangon-Chua, ALC’s Chairman Emeritus. Casas claims that
the reason for her abrupt dismissal was not disclosed to her, but she was promised a separation pay. She thus packed her things and
left.3

BMPI, on the other hand, asserts that it was Casas who requested a graceful exit from the company during the January 5, 2007
meeting. The meeting was supposedly held to confront Casas about certain complaints against her, and about the growing rift
between her and another company officer. BMPI asserts that Casas opted to leave the company to avoid an administrative
investigation against her and to give her the chance to jumpstart her career outside the company. She succeeded in convincing
Cabangon to grant her some form of financial assistance as they were friends. 4

Casas no longer reported for work on January 8, 2007, and BMPI, for its part, started the processing of her clearance. 5 On May 17,
2007, Casas sent Cabangon-Chua a letter asking for the reconsideration of his decision to terminate her employment. Cabangon-
Chua did not act on this letter.6

On July 20, 2007, Casas filed a complaint for illegal dismissal and for payment of separation pay, backwages, retirement benefits
and attorney’s fees before the Regional Arbitration Branch. The complaint was docketed as NLRC LAC 05-001892-08.7

The Labor Arbiter’s Ruling

Labor Arbiter (LA) Fedriel S. Panganiban dismissed Casas’ complaint for lack of merit, and ordered BMPI to reinstate her to her
previous position without payment of backwages.8

The LA found that Casas was not dismissed from work; she instead abandoned her post. Citing Chong Guan Trading Inc. v.
NLRC9 and Security & Credit Investigation, Inc. v. NLRC, 10 the LA held that no illegal dismissal takes place when the employee
has not been notified of his dismissal; in the absence of any positive and overt act of dismissal, the claim of illegal dismissal
cannot be sustained.11

The LA noted that there was no written notice of Casas’ dismissal, and that it was contrary to sound business practice to verbally
terminate an employee facing investigation for reported irregularities; BMPI had every reason to retain Casas’ services and to
proceed with the investigation against her. Thus, the LA agreed with BMPI’s contention that Casas left her work to pre-empt the
investigation of complaints against her. Her act of packing her things on January 5, 2007, in fact, demonstrated that she no longer
intended to return to work.12
Because no illegal dismissal took place, the LA refused to grant Casas her demanded backwages, separation pay and retirement
benefit. Instead, the LA ordered BMPI to reinstate Casas so that a proper investigation may be conducted on the irregularities she
allegedly committed.13

The NLRC’s ruling

Casas appealed the LA’s ruling with the National Labor Relations Commission (NLRC), which reversed the LA’s finding that
Casas had not been illegally dismissed.14

The NLRC found that Casas’ dismissal had been sufficiently established by evidence on record. Contrary to the petitioners’
allegations, these records show that Casas’ services had been terminated by BMPI as she was issued a "Clearance and Quitclaim"
document that clearly stated that she would "cease to be connected with the company at the close of office hours on January 16,
2007." This, along with BMPI’s failure to respond to Casas’ May 17, 2007 letter asking for the reconsideration of her termination,
constitute positive and overt acts of dismissal.15

Casas’ dismissal, according to the NLRC, was without just cause and did not have the benefit of due process. She was never
accorded any hearing or even a show-cause notice, despite the serious allegations charged against her. Instead, the records show
only the "Clearance and Quitclaim" document, which does not explain why her employment relationship with

BMPI would cease. The NLRC also found that Cabangon and Cabangon-Chua acted with malice and bad faith in dismissing
Casas, and thus held them jointly and severally liable withBMPI for payment of Casas’ monetary award. 16

The Court of Appeals’ Decision

The Court of Appeals affirmed the NLRC’s ruling, and held that it did not commit any grave abuse of discretion in finding that
Casas had been illegally dismissed. The CA cited with approval the NLRC’s ruling that Casas’ dismissal was without cause and
failed to comply with the procedural requirements of the law. 17

The CA explained that Casas is presumed innocent until proven guilty of the charges against her. Since her alleged infractions had
not been investigated, it followed that Casas was dismissed without cause. The CA also noted that BMPI failed to comply with the
two written notices required prior to a lawful termination of an employee, and hence failed to comply with the procedural due
process that the law requires.18

The present petition

BMPI, Cabangon and Cabangon-Chua assail the CA ruling through the present petition for review on certiorari,19based on the
following arguments:

1) Casas voluntarily left the company to preempt an administrative investigation against her, and to be able to jumpstart a
new career.20

2) The clearance and quitclaim document is a standard operating procedure for a person who has resigned or retired from
the company for the protection of the employer. It establishes that the issue of employment severance has been settled
beforehand. In fact, BMPI cited the clearance and quitclaim document to explain why Casas’ last pay was temporarily
withheld from her.21

3) BMPI denied receipt of Casas’s letter, and claimed that it did not issue any show cause order against Casas because she
left the company to prevent an administrative investigation against her.

Her voluntary exit also explains BMPI’s non-compliance with the legal notice requirements.22

In her Comment/Opposition23 to BMPI’s petition, Casas maintained that the CA did not err in finding that she had been illegally
dismissed from work. She emphasized that the quitclaim and clearance document unilaterally prepared by BMPI was evidence of
their expectation to sever her employment,24 and that BMPI failed to present any resignation letter from her to prove that she
voluntarily left her work.25 Lastly, Casas asserted that Cabangon compelled her to quit her job, in exchange for a retirement
package. This package, however, was never granted to her, despite her compliance with her end of the agreement that she would
no longer report to work after January 5, 2007. 26

Issues

The parties’ arguments present to us the sole issue of whether the Court of Appeals erred when it found no grave abuse of
discretion in the NLRC’s ruling that Casas had been illegally dismissed.

The Court's Ruling

The CA did not err in finding that the NLRC did not commit any grave abuse of discretion in its decision.

Mode of review in illegal dismissal cases

The present petition involves mixed questions of fact and law, with the core issue being one of fact. This issue – from which the
other issues arise relates to the nature of Casas’ termination of employment relationship with BMPI. Did she voluntarily resign
from, or abandon her work at, BMPI, or was she summarily dismissed by Cabangon?

This question of fact is an issue that we cannot resolved in a Rule 45 petition, except in the course of determining whether the CA
correctly ruled in determining that the NLRC did not commit grave abuse of discretion. In other words, the question we ask in
resolving the present case is not whether Casas abandoned her work or was illegally dismissed; instead, we ask whether the CA
erred in not finding grave abuse of discretion in the NLRC’s decision finding that Casas was dismissed from work. 27

Should we find that Casas had indeed been summarily dismissed, the next question involves the nature of her dismissal – did it
comply with the procedural and substantial requirements of the law, or was it an illegal dismissal that should warrant the award to
Casas of backwages and separation pay?

Keen awareness of the lens used to review this question is critical, given the jurisdiction of this Court and the nature of review
employed in labor cases appealed to the Court under Rule 45. The Court, save for exceptional cases, is not a trier of facts; as a
general rule, it resolves only questions of law. Additionally, the NLRC’s decision is final and executory, and can be reviewed by
the CA only when the NLRC committed a grave abuse of discretion amounting to a lack or excess of jurisdiction. 28

Thus, the CA, in a Rule 65 petition assailing the NLRC’s decision, examines whether the NLRC acted in such a "capricious and
whimsical exercise of judgment so patent and gross as to amount to an evasion of a positive duty or a virtual refusal to perform a
duty enjoined by law."29 This is in contrast with appeals reaching the CA through a Rule 45 petition, where it has more leeway in
reviewing both questions of fact and of law, and where the appealed decision may be reversed because of an error in judgment.30

Once the CA decision reaches the Court through a Rule 45 petition, the question presented before us carries with it the mode of
review applied when the case has been appealed before the CA. Although we are asked to determine whether the CA committed an
error in judgment, we necessarily have to consider that the judgment made by the CA involves the question of determining grave
abuse of discretion. Unlike other petitions for review on certiorari where we determine errors of law (and in exceptional cases,
errors of fact), our appellate jurisdiction in labor cases involves the determination of whether there had been an error in finding
grave abuse of discretion on the part of the NLRC.31

With these considerations in mind, the onus probandi in assailing a question of fact as determined by the NLRC and upheld by the
CA becomes heavier. Not only must an exceptional circumstance allowing the Court to review a question of fact exist; it must also
be shown that the NLRC’s resolution of the factual issue must have been tainted with grave abuse of discretion, such that the CA
erred in affirming it.

Indeed, the labor arbiter and the NLRC in the present case arrived at factual conclusions ―the LA found that Casas had not been
dismissed, but the NLRC reversed this finding. While the contradicting findings of the LA and the NLRC may be a ground to re-
evaluate the factual question of whether Casas abandoned her work or had been dismissed, we find no reason to dispute the
NLRC’s conclusion.

The CA did not err in affirming the

NLRC’s factual finding that Casas
had been dismissed from work

We support the CA in finding no grave abuse of discretion in the NLRC’s factual conclusion that Casas had been dismissed from
work.

In illegal dismissal cases, the employer has the burden of proving that the employee’s dismissal was legal.1âwphi1However, to
discharge this burden, the employee must first prove, by substantial evidence, that he had been dismissed from employment. 32

The CA, in affirming the NLRC’s conclusion that Casas had been dismissed, gave emphasis to the existence of two documents on
record: first, the unsigned clearance and quitclaim document unilaterally prepared by BMPI, and second, the letter Casas sent to
Cabangon-Chua, asking the latter to reconsider her termination.

These pieces of evidence sufficiently establish Casas’ dismissal from the company.

The Clearance and Quitclaim document discloses that Casas would "cease to be connected with the company at the close of office
on January 16, 2007." The document, which was even introduced as evidence by the petitioners, was prepared unilaterally at
Cabangon’s instructions. It shows the company’s intent to sever its employment relationship with Casas. Considered together with
the letter Casas sent Cabangon-Chua asking for her reinstatement on May 17, 2007, these documents back Casas’sr assertion that
she was compelled to leave her job on January 5, 2007.

As their main defense, BMPI and Cabangon claim that they never dismissed Casas from work, and that she instead requested a
graceful exit from the company.

We do not find any merit in the petitioners’ contention.

Jurisprudence has established that employers interposing their employee’s resignation as a defense from illegal dismissal cases
have the burden of proving that the employee indeed voluntarily resigned.33 Resignation — the formal pronouncement or
relinquishment of a position or office — is the voluntary act of an employee compelled by personal reason(s) to disassociate
himself from employment.34 It is done with the intention of relinquishing an office, accompanied by the act manifesting this
intent.35

In the present case, the petitioners allege that Casas asked for a graceful exit from the company to avoid an administrative
investigation against her. They claim that Casas had grossly failed to manage and take control of BMPI’s ex-deal assets, which
caused the company serious losses. When Casas was confronted about these reports of mismanagement, she voluntarily resigned
from office in exchange for separation pay.

In our view, the NLRC and CA correctly disregarded these allegations in concluding that Casas had been terminated from office.

First, the pieces of evidence that the petitioners submitted are insufficient to establish their claim. To prove that Casas voluntarily
abandoned her work, the petitioners submitted affidavits from their employees, Domingo Almoninia, Jr. and Victoria C. Nava,
who both testified to the events leading to a private conversation between Casas and Cabangon.

Domingo Almoninia, Jr., BMPI’s former Chief Audit Executive, Testified 36 that he had informed Cabangon of reports regarding
Casas’s mismanagement of BMPI’s ex-deal assets on January 5, 2007. Casas, together with Vice President for Human Resources
Victoria Nava, were then summoned to Cabangon’s room. According to Almoninia, he witnessed Cabangon confront Casas
regarding reports about her mismanagement and certain unauthorized transactions. In the course of the discussion, Cabangon
allegedly told Casas that the reports against her would have to be investigated, and instructed her to settle her differences with a
certain Mr. Tayag. Casas asked Cabangon if she was being dismissed, to which the latter answered in the negative. Both
Almoninia and Nava were then asked to leave the room.

Nava, on the other hand, corroborated Almoninia’s narration, and added insinuations that Casas had been having problems in the
company.37

In considering their affidavits, we emphasize that neither Almoninia nor Nava were present in the private conversation that ensued
between Cabangon and Casas, after the confrontation that they witnessed. This leaves Cabangon’s claim that Casas asked for a
graceful exit from the company uncorroborated; what stands is Casas’ statement contradicting the claim that she had not been
dismissed from her job.

Second, Cabangon failed to provide any documentary evidence supporting Casas’ voluntary resignation. BMPI failed to show any
resignation letter from Casas. The Clearance and Quitclaim document, which shows Casas’ severance from the company, does not
contain her signature.38 Neither was Casas given any return to work order, notice of infraction, or notice of termination, all of
which could have supported BMPI’s theory that Casas was never prevented from going back to work.

Third, Cabangon, Almoninia and Nava’s testimonies show that Casas could have entertained the motive to resign from her work,
but does not prove her intent to leave her office. Intent to relinquish one’s office is determined from the acts of an employee before
and after the alleged resignation. Casas’ acts after allegedly resigning from work negate this intent: she wrote a letter asking
Cabangon-Chua to reconsider her termination from office; she refused to sign the Clearance and Quitclaim document; and she
filed an illegal dismissal case against her employers.

This conclusion brings us to the question of whether the CA erred in affirming the NLRC’s conclusion that Casas had been
illegally terminated from work.

The CA did not err in affirming the

NLRC’s conclusion that Casas’
dismissal violated the procedural
requirements of the Labor Code

In ruling that Casas’ dismissal had been contrary to law, both the CA and the NLRC emphasized that her sudden termination from
office was without just cause and violated procedural due process.

According to the NLRC, despite the serious allegations that the BMPI lodged against Casas, it never asked her to explain her acts,
and instead opted to sever its employment relations with her. On this basis alone, the NLRC concluded that Casas’ dismissal had
been illegal and non-compliant with procedural due process.39

The CA affirmed this conclusion by pointing out that Casas had been dismissed prior to any probe on her reported violation of
company rules and regulations.40

In determining whether an employee’s dismissal had been legal, the inquiry focuses on whether the dismissal violated his right to
substantial and procedural due process. An employee’s right not to be dismissed without just or authorized cause as provided by
law, is covered by his right to substantial due process. Compliance with procedure provided in the Labor Code, on the other hand,
constitutes the procedural due process right of an employee. 41

The violation of either the substantial due process right or the procedural due process right of an employee produces different
results. Termination without a just or authorized cause renders the dismissal invalid, and entitles the employee 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.
An employee’s removal for just or authorized cause but without complying with the proper procedure, on the other hand, does not
invalidate the dismissal. It obligates the erring employer to pay nominal damages to the employee, as penalty for not complying
with the procedural requirements of due process. 42

Thus, two separate inquiries must be made in resolving illegal dismissal cases: first, whether the dismissal had been made in
accordance with the procedure set in the Labor Code; and second, whether the dismissal had been for just or authorized cause.

There can be no doubt that the procedural requirements had not been complied with in the present case: shortly after a private
conversation between Cabangon and Casas, Casas took her belongings from the office and left the building. As explained earlier,
Casas’s acts after this private conversation reveal that she had been summarily dismissed: Casas gave no resignation letter, refused
to sign the Clearance and Quitclaim document that the company issued, and sent a letter asking for her reinstatement.

Notably, the private conversation that led to Casas’s summary dismissal did not conform, in any way, to the procedural due
process requirements embodied in Rule XIV of the Omnibus Rules Implementing the Labor Code, viz:

RULE XIV Termination of Employment

SECTION 1. Security of tenure and due process. — No workers shall be dismissed except for a just or authorized cause provided
by law and after due process.

SECTION 2. Notice of dismissal.— Any employer who seeks to dismiss a worker shall furnish him a written notice stating the
particular acts or omission constituting the grounds for his dismissal. In cases of abandonment of work, the notice shall be served
at the worker's last known address.

xxx

SECTION 5. Answer and hearing. — The worker may answer the allegations stated against him in the notice of dismissal within a
reasonable period from receipt of such notice. The employer shall afford the worker ample opportunity to be heard and to defend
himself with the assistance of his representative, if he so desires.

SECTION 6. Decision to dismiss. — The employer shall immediately notify a worker in writing of a decision to dismiss him
stating clearly the reasons therefor.

Cabangon failed to show any written notice provided to Casas informing her of the charges against her, and neither had she been
informed in writing of her dismissal and the reasons behind it.

Even assuming arguendo that Casas had indeed voluntarily abandoned her work – an uncorroborated claim by Cabangon –
Cabangon had the duty to give Casas a written notice of the grounds leading to her dismissal.

Thus, Cabangon failed to comply with the two-notice requirement under the law, resulting in a violation of Casas’s right to
procedural due process. This conlusion leads us to the next query: whether her dismissal was for just cause.

The CA did not err in finding no

grave abuse of discretion in the
NLRC’s decision to hold that Casas
had been dismissed without just
cause

According to the CA, Casas’s dismissal had not been for just cause, because at the time she was dismissed, not one of the charges
against her had been proven. Casas was, at the time of her dismissal, presumed innocent until proven guilty; thus, there existed no
just cause to terminate her employment at the time she was summarily dismissed. 43

In reaching this conclusion, the CA reviewed whether the NLRC acted with grave abuse of discretion in holding that Casas’s
dismissal had no just cause. The NLRC, in its decision, held that Casas’s dismissal had not been for just cause because she was not
even allowed to explain the supposed acts that had been inimical to BMPI’s interests. 44

In affirming the NLRC’s decision, the CA clarified the application of procedural and substantial due process in the present case:
Casas had not been given the two-notice requirement in the law, and hence, her procedural due process rights had been violated.
And because not one of the allegations against her had been proven at the time she was summarily dismissed, there existed no
cause to terminate her services.

We find that the CA did not err in making this ruling.

To reiterate, the CA reviews the decision of the NLRC using the prism of grave abuse of discretion, and not through an appeal.
Grave abuse of discretion implies such capricious and whimsical exercise of judgment as to be equivalent to lack or excess of
jurisdiction. In other words, power is exercised in an arbitrary or despotic manner so patent or so gross that it amounts to an
evasion of a positive duty or to a virtual refusal to act at all in contemplation of law.
Thus, for a decision to be in grave abuse of discretion, it should involve not just an error of law or an error of fact, but errors that
are so patent or gross that the decision reached is a decision that had not been made in contemplation of law at all.

No such error exists in the present case.

We have, in the past, affirmed the NLRC in ruling that an employee’s act not proven at the time he had been dismissed does not
constitute just cause for his dismissal.45 In other words, for an act to justify an employee’s dismissal, it should have been proven,
with substantial evidence,46 at the time he was dismissed. Otherwise, the dismissal would not be for just cause.

This conclusion finds support in cases emphasizing that an unsubstantiated accusation will not ripen into a holding that there is just
cause for dismissal.47 A mere accusation of wrongdoing is not sufficient cause for a valid dismissal of an employee. The facts for
which a dismissal is based should be backed by substantial evidence at the time the employee is dismissed, and not at the time his
dismissal is being questioned before the courts.

In the present case, the petitioners allege that Casas had committed various infractions that would have warranted disciplinary
action against her. At the time that Casas was dismissed, however, these alleged infractions were mere speculations. The present
petition for review on certiorari admits this reality in two instances: first, in the body of the petition itself stating that at the time of
the January 5, 2007 meeting, disciplinary proceedings had yet to be initiated against Casas and that the reports against her would
still have to be verified;48 and second, through its annexes,49which provided that the result of the investigation in the ex-deal assets
that Casas allegedly mismanaged was produced only on February 17, 2007, or a full month after Casas’ dismissal.

Thus, at the time Cabangon asked Casas to leave her employment, all he had as basis for Casas’s dismissal were speculations.
Worse, Cabangon’s summary dismissal of Casas left her with little opportunity to adequately defend herself from the allegations
against her.

In these lights, we support the CA in holding that Casas’ summary dismissal had not been for just cause.

Just cause must be proven with

substantial evidence at the time of
dismissal

At its core, substantive due process guarantees a right to liberty that cannot be taken away or unduly constricted, except through
valid causes provided in the law.50

The concepts of procedural and substantive due process had been carried over and applied to illegal dismissal cases, although
notably, employers are not governmental bodies to which these rights usually refer. Agabon v. NLRC 51 described the due process
required in dismissing employees as statutory – requirements that the law imposes on employers to comply with, in contrast to
constitutional due process rights that guarantee against overreach from the government.

Although statutory in nature, the procedural and substantive due process requirements in illegal dismissal cases stem from the
protection that the Constitution provides labor – the Constitution has tasked the State to promote the workers’ security of tenure,
humane conditions of work, and a living wage. 52 These guarantees, as well as a host of other rights and responsibilities,53 find
implementation through the Labor Code, which fleshed out the concept of security of tenure 54 as the continuance of regular
employment until an employee's services are terminated because of just or authorized causes enumerated in the law.

Thus, despite the differences in origin and application between constitutional due process rights and the statutory requirements in
the Labor Code, we have applied concepts implementing constitutional due process rights to the statutory due process
requirements of the Labor Code. We did this in the present case, when we emphasized the need for substantial evidence to support
the just cause for the employee's dismissal at the time her services were terminated. In the same way that the crime charged against
an accused must first be proven before his or her right to liberty is taken away, or that a government employee's infraction must
first be proven before the accused is deprived of the right to continue !o hold office, so too, must just cause against an employee be
proven before he or she may be deprived of a means of livelihood. Otherwise, the employee's right to substantive due process
would be violated.

In these lights, and in order to give full effect to the embodiment of substantive due process in illegal dismissal cases, it is
necessary to rule, that an employee, in this present case Casas, cannot be terminated from service without sufficient substantial
evidence of the just cause that would merit her dismissal.

WHEREFORE, premises considered, the petition is DISMISSED, and the Court of Appeals decision in CA-G.R. SP No. 116539 is
AFFIRMED.

SO ORDERED.

ARTURO D. BRION
Associate Justice

WE CONCUR:
 ANTONIO T. CARPIO
Associate Justice
Chairperson

MARIANO C. DEL CASTILLO JOSE CATRAL MENDOZA

Associate Justice Associate Justice

MARVIC M.V.F. LEONEN

Associate Justice

ATTESTATION

I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of
the opinion of the Court's Division.

ANTONIO T. CARPIO
Associate Justice
Chairperson, Second Division

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, and the Division Chairperson's Attestation, I certify that the conclusions in
the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court's
Division.

MARIA LOURDES P.A. SERENO

Chief Justice

Footnotes

1
Rollo, pp. 9-30.

2
Court of Appeals Decision in CA-G.R. SP No. 116539 promulgated December 11, 2009, id. at 236.

3
National Labor Relations Commission Decision in NLRC NCR Case No. 00-07-07706-07 promulgated July 31, 2009,
id. at 145.

4
Petition for Review on Certiorari, id. at 9-10.

5
See Clearance and Quitclaim, id. at 62.

6
National Labor Relations Commission Decision in NLRC NCR Case No. 00-07-07706-07 promulgated July 31, 2009,
id. at; Court of Appeals Decision in CA-G.R. SP No. 116539 promulgated December 11, 2009, id. at 240.

7
Petition for Review on Certiorari, id. at 12

8
Labor Arbiter’s Decision in NLRC LAC 05-001892-08 promulgated February 29, 2008, id. at 93- 103.

9
G.R. No. 81471, April 26, 1989, 172 SCRA 831.

10
G.R. No. 114316, January 26, 2001, 350 SCRA 357.

11
Labor Arbiter’s Decision in NLRC LAC 05-001892-08 promulgated February 29, 2008, rollo, p. 100.

12
Labor Arbiter’s Decision in NLRC LAC 05-001892-08 promulgated February 29, 2008, id. at 99- 100.

13
Labor Arbiter’s Decision in NLRC LAC 05-001892-08 promulgated February 29, 2008, id. at 102-103.

14
National Labor Relations Commission Decision in NLRC NCR Case No. 00-07-07706-07 promulgated July 31, 2009,
id. at 143-150.

15
Id. at 146-147.

16
Id. at 146-148.

17
Court of Appeals Decision in CA-G.R. SP No. 116539 promulgated December 11, 2009, id. at 235-242.
18
Id. at 240-241.

19
Petition for Review on Certiorari, id. at 7-22.

20
Id. at 14

21
Id. at 15-17.

22
Id. at 20.

23
Comment, rollo, pp. 343-358.

24
Id. at 352-354.

25
Id. at 354-355.

26
Id. at 353.

27
Montoya v. Transmed Manila Corporation, G.R. No. 183329, August 27, 2009, 597 SCRA 334, 342 – 343.

28
Id. at 343.

29
Jimenez v. People of the Philippines, G.R. No. 209195, September 17, 2014

30
Supra note 27, at 342 – 343.

31
Career Philippines Ship Management Inc. v. Serna, G.R. No. 172086, December 3, 2012, 686 SCRA 676, 683 – 684.

32
Ledesma Jr. v. NLRC, G.R. No. 174585, October 19, 2007, 562 SCRA 939, 951 – 952.

33
See, for instance, Vicente v. Court of Appeals, 557 Phil. 777, 785 (2007); Mobile Protective & Detective Agency v.
Ompad, 497 Phil. 621, 634 – 635 (2005).

34
San Miguel Properties v. Gucaban, G.R. No. 153982, 18 July 2011, 654 SCRA 18, 28 – 29; Star Paper Corporation v.
Simbol, 521 Phil. 363, 379 (2006).

35
Vicente v. Court of Appeals, 557 Phil. 777, 785 (2007); Fortuny Garments v. Castro, 514 Phil. 317, 323 (2005).

36
Affidavit of Domingo R. Almoninia Jr. dated November 23, 2007, rollo, pp. 47-48.

37
Affidavit of Victoria C. Nava dated November 29, 2007, id. at 49-51.

38
Clearance and Quitclaim, id. at 62.

39
National Labor Relations Commission Decision in NLRC NCR Case No. 00-07-07706-07 promulgated July 31, 2009,
id. at 146-147.

40
Court of Appeals Decision in CA-G.R. SP No. 116539 promulgated December 11, 2009, id. at 241.

41
See Deoferio v. Intel Technology Philippines Inc., G.R. No. 202996, June 18, 2014; Sang-An v. Equator Knights
Detective and Security Agency, G.R. No. 173189, February 13, 2013, 690 SCRA 534, 542; Bughaw, Jr. v. Treasure
Island Industrial Corporation, 573 Phil. 435, 448 (2008); Agabon v. NLRC, 485 Phil. 248, 284 (2004).

42
Agabon v. NLRC, 485 Phil. 248, 285 – 287 (2004).

43
Court of Appeals Decision in CA-G.R. SP No. 116539 promulgated December 11, 2009, rollo, p. 241.

44
National Labor Relations Commission Decision in NLRC NCR Case No. 00-07-07706-07 promulgated July 31, 2009,
id. at 146-148.

45
In Gothong Lines Inc. v. NLRC, 362 Phil. 502 (1999), the employer therein alleged, as one of the reasons for
dismissing his employee Adolfo Lauron, that Lauron had been charged with the crime of arson. The Court, in concluding
that Lauron had been illegally dismissed, held that he is presumed innocent until proven guilty of commiting the crime,
and that for the commission of the crime of arson to be used to justify Lauron’s termination, it should first be proven by
substantial evidence.
46
Pili v. National Labor Relations Commission, 217 SCRA 338, at 345, citing Manila Electric Company v. NLRC, 198
SCRA 681 (1991).

47
ALPS Transportation v. Rodriguez, G.R. No. 186732 , June 13, 2013 698 SCRA 423, 432 – 433.

48
Petition for Review on Certiorari, rollo, pp. 19 – 20.

49
Annex 3 – Reply pertaining to the Memorandum from the Central Audit Group Regarding "Over- Consumption and
Shortages in Materials", id. at 52.

50
Substantive due process inquires whether the government has sufficient justification for depriving a person of life,
liberty, or property. White Light Corporation v. City of Manila, G.R. No. 122846, January 20, 2009, 576 SCRA 416, 435
– 436.

51
485 Phil. 248 (2004).

52
Article XIII, Section 3, 1987 Constitution

53
Section 3. The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote
full employment and equality of employment opportunities for all.

It shall guarantee the rights of all workers to self-organization, collective bargaining and negotiations, and
peaceful concerted activities, including the right to strike in accordance with the law. They shall be entitled to
security of tenure, humane conditions of work, and a living wage. They shall also participate in policy and
decision making processes affecting their rights and benefits as may be provided by law.

The State shall promote the principle of shared responsibility between workers and employers and the
preferential use of voluntary modes in settling disputes, including conciliation, and shall enforce their mutual
compliance therewith to foster industrial peace.

The State shall regulate the relations between workers and employers, recognizing the right of labor to its just
share in the fruits of production and the right of enterprises to'. reasonable returns to investments, and to
expansion and growth

54
Art. 279. Security of tenure.1âwphi1 In cases of regular employment, the employer shall not terminate the services of
an employee except for a just cause or when authorized by this Title. An 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. (As amended by Section 34, Republic Act No. 6715, March
21, 1989)
 THIRD DIVISION

MARIO B. DIMAGAN, G.R. No. 191053

Petitioner,
Present:

VELASCO, JR., J.,

Chairperson,
- versus - PERALTA,
ABAD,
MENDOZA, and
PERLAS-BERNABE, JJ.
dacworks United, incorporated and/or
dean a. cancino,
Respondents. Promulgated:
November 28, 2011

x------------------------------------------------------------------------------------x

DECISION

PERLAS-BERNABE, J.:

This is a petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure assailing the Decision 1 dated July 10,
2009 and the Resolution2 dated January 22, 2010 rendered by the Court of Appeals (CA) in CA-G.R. SP No. 105771. The CA
reversed and set aside the Resolutions3 of the National Labor Relations Commission (NLRC) dated May 29, 2007 and July 15,
2008 in NLRC NCR CA No. 047312-06/NLRC NCR-00-07-07590-03 finding petitioner Mario B. Dimagan to have been illegally
dismissed.

Petitioner Mario B. Dimagan is a stockholder of respondent DACWORKS UNITED, INC., which is engaged in the business of
installing, maintaining and repairing airconditioning systems. In July 1997, he started working for respondent company as Officer-
in-Charge (OIC) for mechanical installation with a monthly salary of P8,000.00.

Sometime in 2002, petitioner was downgraded from his post as OIC to supervisor. Then, in March of the following year, he was
made to work as a mere technician. When he vocally expressed his concerns regarding his assignments, one Loida Aquino, who
was in charge of servicing/personnel under the direct supervision of respondent Dean A. Cancino, told him not to report for work
anymore. Thereafter, a certain Carlito Diaz, Operations Manager of respondent company, castigated petitioner for not following
Aquino's instruction to work as a technician. This prompted petitioner to file a complaint for illegal dismissal, non-payment of
overtime pay, holiday pay, service incentive leave and separation pay against respondents.

Respondents denied that petitioner was illegally dismissed arguing that, since April 4, 2003 up to the time of the filing of the
complaint, petitioner never reported for work and continuously violated the company policy on absence without official leave
(AWOL). They allegedly sent a total of four (4) memoranda for the period August 2002 to March 2003 informing petitioner of his
offenses, including being AWOL, but he nonetheless unjustifiably refused to return to work.
In reply, petitioner denied ever receiving any one of the four memoranda allegedly sent by respondents.

On October 28, 2005, the Labor Arbiter rendered a decision 4 in favor of petitioner disposing as follows:

WHEREFORE, respondents are hereby ordered to reinstate complainant to his former position with
full backwages which as of this date has amounted to P240,800.00.

All the other claims are hereby DISMISSED.

SO ORDERED.5

In holding that petitioner was illegally dismissed, the Labor Arbiter pointed out that there was no denial by respondents that they
relegated petitioner from the position of OIC to supervisor and then to ordinary technician. The last assignment was meant to
humiliate him and deprive him of his dignity as stockholder of the company. Moreover, the immediate filing by petitioner of the
complaint for dismissal negated the defense of abandonment interposed by respondents.
On appeal, the NLRC rendered a Resolution6 dated May 29, 2007 affirming the Labor Arbiter's Decision in toto. It took note of the
dearth of evidence to show that petitioner duly received the memoranda allegedly sent by respondents informing him of his
suspension from work. In affirming petitioner's constructive dismissal, the NLRC ratiocinated that he was not given overtime pay
despite the fact that he frequently worked late nights because he was supposedly a managerial employee. But when respondents
started treating him as a rank-and-file employee by making him work as a mere technician, such act of clear discrimination,
insensibility or disdain became unbearable to petitioner.

Further, the NLRC clarified that the phrase as of this date in the decretal portion of the Decision of the Labor Arbiter signified that
the computation of petitioner's backwages starts from the date when his compensation was withheld from him until the date of his
actual reinstatement, as provided in Article 279 of the Labor Code.

Respondents sought reconsideration7 of the NLRC's Resolution. However, in his Comment/Opposition8 thereto, petitioner alleged
that respondents rigged, tampered, distorted and perverted the mailing of their motion for reconsideration to make it appear that it
was mailed on the last day for filing thereof, or on June 25, 2007, at the Mayamot Post Office. To prove the same, petitioner
submitted a Certification9 from the postmaster of the Mayamot Post Office, Antipolo City, stating that there was no record of
registered mails posted on June 25, 2007 by Atty. Gerardo B. Collado, counsel for the respondents, and addressed to the NLRC
and to petitioner's counsel, Atty. Jonathan Polines.

On July 15, 2008, the NLRC issued a Resolution10 denying respondents' motion for reconsideration for lack of merit without,
however, passing judgment on the allegation that respondents manipulated the filing of their motion for reconsideration. The
NLRC merely directed respondents to file a comment and/or explanation within five (5) days from receipt of the aforesaid
Resolution, to which the latter complied.11

Subsequently, respondents filed a petition for certiorari 12 under Rule 65 of the same Rules before the CA. In its challenged
Decision13 dated July 10, 2009, the CA reversed and set aside the Resolutions of the NLRC upon a finding that there was no
dismissal of petitioner to speak of, whether actual or constructive, considering the absence of substantial evidence to prove that his
services were, in fact, terminated by respondents; or that there was a demotion in rank or a diminution of his salaries, benefits and
privileges

With regard to the procedural aspect, the CA held that, since the NLRC did not categorically address the issue on the alleged
manipulation in the mailing of respondents' motion for reconsideration even after the required explanation was submitted by the
latter, then said motion was considered as timely filed.

Aggrieved, petitioner moved14 for reconsideration of the CA Decision, but it was denied in the Resolution 15 dated January 22,
2010 for lack of merit. Hence, the instant recourse on the following grounds, to wit:

(A)

THE COURT OF APPEALS HAS FAILED IN ITS DUTY TO DETERMINE THAT RESPONDENTS
HAVE FAILED TO COMPLY WITH THE REQUIREMENTS ON THE APPROPRIATE SWORN
CERTIFICATION ON FORUM-SHOPPING TO BE SUBMITTED TOGETHER WITH THE
PETITION FOR CERTIORARI, THAT WOULD CALL FOR THE EXERCISE BY THIS
HONORABLE SUPREME COURT OF ITS POWER OF SUPERVISION.

(B)

THE COURT OF APPEALS HAS FAILED IN ITS DUTY TO DETERMINE THAT RESPONDENTS
HAVE VIOLATED THE CERTIFICATION ON NON-FORUM SHOPPING, BY REFUSING AND
FAILING TO DISCLOSE THE PENDING INVESTIGATION BEING CONDUCTED BY THE NLRC
ON THE RESPONDENTS' MANIPULATION OF THE MAILING OF THEIR MOTION FOR
RECONSIDERATION BELOW, THAT WOULD CALL FOR THE EXERCISE BY THIS
HONORABLE SUPREME COURT OF ITS POWER OF SUPERVISION.

(C)

THE COURT OF APPEALS GRAVELY ERRED IN DECLARING THAT PETITIONER WAS NOT
ILLEGALLY DISMISSED, DESPITE THE EXISTENCE OF EVIDENCE INDICATING THE
CONSTRUCTIVE DISMISSAL BY REASON OF CLEAR DISCRIMINATION, INSENSIBILITY OR
DISDAIN COMMITTED BY THE EMPLOYER AGAINST THE PETITIONER. 16

Before delving into the merits of the instant case, the Court shall first resolve petitioner's claim that respondents are guilty of forum
shopping having failed to comply with the required form of the certification, as prescribed 17 by the Rules of Court, and to disclose
the pendency of an investigation being conducted by the NLRC with regard to the allegation of manipulation and/or tampering in
the mailing of respondents' motion for reconsideration.
The Court is not convinced.

Forum shopping exists when a party repetitively avails himself of several judicial remedies in different courts, simultaneously or
successively, all substantially founded on the same transactions and the same essential facts and circumstances, and all raising
substantially the same issues either pending in, or already resolved adversely by, some other court. 18

The elements of forum shopping are: (1) identity of parties, or at least such parties as represent the same interests in both actions;
(2) identity of rights asserted and reliefs prayed for, the relief being founded on the same set of facts; and (3) the identity of the
two preceding particulars, such that any judgment rendered in the other action will, regardless of which party is successful, amount
to res judicata in the action under consideration.19

There was no confluence of the foregoing elements in the instant case. Records show that when respondents filed their petition for
certiorari before the CA, their motion for reconsideration before the NLRC had already been resolved on the merits, and the only
incident left for the NLRC to adjudicate was the alleged mail tampering of respondents. The pendency of such investigation,
however, is merely incidental, such that its resolution will not amount to res judicata in the petition for certiorari before the CA.
Be that as it may, the Court examined the certification on forum shopping 20 attached to respondents' petition for certiorari before
the CA, and found the same to have substantially complied with the requirements under the rules.

On the merits, the Court finds petitioner's arguments meritorious.

At the outset, it must be pointed out that the main issue in this case involves a question of fact. It is an established rule that the
jurisdiction of the Supreme Court in cases brought before it from the CA via Rule 45 of the 1997 Rules of Civil Procedure is
generally limited to reviewing errors of law. This Court is not a trier of facts. In the exercise of its power of review, the findings of
fact of the CA are conclusive and binding and consequently, it is not our function to analyze or weigh evidence all over again.21

This rule, however, is not ironclad. One of the recognized exceptions is when there is a divergence between the findings of facts of
the NLRC and that of the CA,22 as in this case. There is, therefore, a need to review the records to determine which of them should
be preferred as more conformable to evidentiary facts. 23

After a judicious scrutiny of the records, the allegations of petitioner and the defenses raised by respondents, the Court cannot
sustain the finding of the CA that petitioner was not illegally or constructively dismissed.

Constructive dismissal is defined as a quitting because continued employment is rendered impossible, unreasonable or unlikely;
when there is a demotion in rank or a diminution of pay. 24 The test of constructive dismissal is whether a reasonable person in the
employee's position would have felt compelled to give up his position under the circumstances. It is an act amounting to dismissal
but is made to appear as if it were not. Constructive dismissal is therefore a dismissal in disguise. The law recognizes and resolves
this situation in favor of employees in order to protect their rights and interests from the coercive acts of the employer. 25

As held in the case of Coca-Cola Bottlers Philippines, Inc. vs. Del Villar,26 the burden falls upon the company to prove that the
employee's assignment from one position to another was not tantamount to constructive dismissal. In the case at bar, respondents
failed to discharge said burden. In fact, respondents never even disputed that petitioner was relegated from the position of OIC to
supervisor and, subsequently, to an ordinary technician. Clearly, the reduction in petitioner's responsibilities and duties,
particularly from supervisor to ordinary technician, constituted a demotion in rank tantamount to constructive dismissal.

Thus, contrary to the position of the CA, it is of no consequence that petitioner failed to substantiate his allegation
that Loida Aquino, an employee of respondent company, informed him that he will be working as an ordinary technician, and that
when he openly voiced out his concern regarding the transfer, he was told not to report for work anymore. As with all the other
allegations made by petitioner, respondents never disputed or rebutted this fact.

Similarly, We cannot concur with the finding of the CA that it was petitioner who abandoned his employment by failing to report
for work or having gone AWOL.

Abandonment is the deliberate and unjustified refusal of an employee to resume his employment. 27 To constitute abandonment of
work, two elements must concur: (1) the employee must have failed to report for work or must have been absent without valid or
justifiable reason; and (2) there must have been a clear intention on the part of the employee to sever the employer-employee
relationship manifested by some overt act.28 The employer bears the burden of proof to show the deliberate and unjustified refusal
of the employee to resume his employment without any intention of returning. 29

In the case of Hodieng Concrete Products, Inc. v. Emilia30, citing Samarca v. Arc-Men Industries, Inc.31, the Court has ruled thus:

x x x. Absence must be accompanied by overt acts unerringly pointing to the fact that the employee simply does
not want to work anymore. And the burden of proof to show that there was unjustified refusal to go back to work
rests on the employer.
 xxx

Abandonment is a matter of intention and cannot lightly be presumed from certain equivocal acts. 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 employees ultimate act of putting an end to his
employment.

Settled is the rule that mere absence or failure to report for work is not tantamount to abandonment of
work. x x x. (Emphasis supplied)

In this case, petitioner's failure to report for work was caused by the unwarranted demotion in rank that was imposed upon him by
respondents, not by any intention to sever employment ties with them. And his filing of the instant complaint for illegal dismissal
indubitably negates the allegation of abandonment. Had petitioner intended to forsake his job, then he would not have found it
necessary to institute this case against respondents.

In sum, the CA committed reversible error when it held that petitioner was not illegally or constructively dismissed. With respect
to the investigation being conducted by the NLRC regarding the alleged tampering and/or manipulation of the mailing of
respondents' motion for reconsideration filed before it, the Court no longer finds it necessary to pass upon the same.

WHEREFORE, the instant petition is GRANTED. The assailed Decision and Resolution of the CA are SET ASIDE. The
Resolutions of the NLRC affirming the Decision of the Labor Arbiter are REINSTATED. Petitioner is entitled to reinstatement
without loss of seniority rights and other privileges and to his full backwages, inclusive of allowances, and to his other benefits
computed from the time his compensation was withheld from him or on April 4, 2003, up to the time of his actual reinstatement, in
accordance with Article 27932 of the Labor Code.

SO ORDERED.

ESTELA M. PERLAS-BERNABE
Associate Justice

WE CONCUR:

PRESBITERO J. VELASCO, JR.

Associate Justice
Chairperson

DIOSDADO M. PERALTA ROBERTO A. ABAD

Associate Justice Associate Justice

JOSE C. MENDOZA
Associate Justice

ATTESTATION

I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of
the opinion of the Court's Division.

PRESBITERO J. VELASCO, JR.

Associate Justice
Chairperson, Third Division

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, and the Division Chairperson's Attestation, I certify that the conclusions in
the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court's
Division.
RENATO C. CORONA
Chief Justice
1 Rollo, pp. 35-47.
2 Id., pp. 67-71.
3 Id., pp. 145-149, 151-153.
4 Id., Annex E, pp. 73-77.
5 Id., pp. 76-77.
6 Id., Annex F, pp. 79-83.
7 Id., Annex G, pp. 84-104.
8 Id., Annex H, pp. 107-113.
9 Id., p. 117.
10 Id., Annex I, pp. 121-123.
11 Id., Exhibit 2, pp. 208-215.
12 Id., Annex J, pp. 124-139.
13 Supra note 1.
14 Rollo, Annex B, pp. 48-55.
15 Supra note 2.
16 Petition, rollo, p. 18.
17 SEC. 5, Rule 7. Certification against forum shopping. - The plaintiff or principal party shall certify under oath in the complaint
or initiatory pleading asserting a claim for relief, or in a sworn certification annexed thereto and simultaneously filed therewith: (a)
that he has not theretofore commenced any action or filed any claim involving the same issues in any court, tribunal or quasi-
judicial agency and, to the best of his knowledge, no such other action or claim is pending therein; (b) if there is such other
pending action or claim, a complete statement of the present status thereof; and (c) if he should thereafter learn that the same or
similar action or claim has been filed or is pending, he shall report that fact within five (5) days therefrom to the court wherein his
aforesaid complaint or initiatory pleading has been filed.
xxx
18 Feliciano v. Villasin, G.R. No. 174929, June 27, 2008, 556 SCRA 348.
19 Id.
20 Rollo, p. 139.
21 Sugue, et. al. v. Triumph International (Phils.), Inc., G.R. No. 164804, January 30, 2009, 556 SCRA 323.
22 Id.
23 Philippine American Life Gen. Insurance Co. v. Gramaje, G.R. No. 156963, November 11, 2004, 442 SCRA 274.
24 Norkis Trading Co. Inc. v. Gnilo, G.R. No. 159730, February 11, 2008, 544 SCRA 279.
25 CRC Agricultural Trading v. NLRC, G.R. No. 177664, December 23, 2009, 609 SCRA 138.
26 G.R. No. 163091, October 06, 2010, 632 SCRA 293.
27 Exodus International Construction Corporation v. Biscocho, et. al., G.R. No. 166109, February 23, 2011.
28 Id.
29 Id.
30 G.R. No. 149180, February 14, 2005, 451 SCRA 249.
31 G.R. No. 146118, October 8, 2003, 413 SCRA 162.
32 ART. 279. Security of Tenure. In cases of regular employment, the employer shall not terminate the services of an employee
except for a just cause or when authorized by this Title. An 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 other monetary equivalent computed from the time his compensation was withheld from him up to the time of his
actual reinstatement.