Hocheng Phil. Corp.

(HPC) v Farrales
G.R. No. 211497 - March 18, 2015
Justice Reyes
DOCTRINE:
“...where there is no showing of a clear, valid and legal cause for termination of employment, the law considers the case a
matter of illegal dismissal. If doubts exist between the evidence presented by the employer and that of the employee, the
scales of justice must be tilted in favor of the latter. The employer must affirmatively show rationally adequate evidence that
the dismissal was for a justifiable cause.”
FACTS
Farrales was an employee of HPC and was consistently promoted due to his outstanding
performance (Production Operator  Leadman  Acting Assistant Unit Chief  Assistant Unit Chief of
Production/supervisory position).
On 2009, a motorcycle helmet of an employee (Reymar) was reportedly stolen, and a CCTV
footage revealed Farrales as the culprit. He was seen pointing at the helmet and instructed another
person (Andy Lopega) to get it. HPC gave Farrales a notice to explain his involvement in the theft. His
defense is that He borrowed a helmet from his co-worker Eric. Not knowing which motorcycle was
Eric’s, he asked another employee, Andy, and ended up getting the helmet from the wrong motorcycle.
Upon realizing he got the wrong helmet, he immediately returned it to the rightful owner and
apologized. Andy said that he was ordered to get the yellow helmet saying that it was his. It was also
found that Eric said what his motorcycle’s plate no. was, and that the helmet’s color was red and blue.
HPC issued a Notice of Termination to Farrales dismissing him for violation of HPC’s Code of
Discipline, which provides that “stealing from the company, its employees and officials…” is akin to
serious misconduct and fraud or willful breach of trust, which are just causes for termination of
employment under Art. 282 of the Labor Code.
Farrales filed a complaint for illegal dismissal. LA ruled in favor of Farrales. NLRC reversed LA’s
decision, finding just cause for the termination. NLRC also denied respondent’s MR. upon petition for
certiorari, CA ruled in favor of Farrales, as HPC failed to prove that Farrales’ conduct was induced by a
perverse and wrongful intent to gain.

ISSUE/HELD/RATIO

1. W/N Farrales was illegally dismissed – YES.

- HPC’s defense: Farrales is subjected to stricter rules as a supervisorial employee, and due to HPC’s
management prerogative, they have a wider latitude of discretion to determine dismissal. Only
substantial proof is needed to prove guilt.
- SC: Art 4 of Labor Code mandates that all doubts in the implementation and interpretation of
provisions shall be ruled in favor of labor. HPC failed to prove that Farrales committed no serious
or willful misconduct or disobedience to warrant dismissal. Upon realizing that it was the wrong
helmet he got, he immediately returned it and apologized.
- Misconduct is improper conduct and implies wrongful intent, not mere error in judgment (as in
the case). The misconduct must be serious and not merely trivial or unimportant.

JUDGMENT: Petition for review is DENIED.