SECURITY OF TENURE

Just Causes

154. Salas v. Aboitiz One

G.R. NO. 178236 June 27, 2008
Security of Tenure; Just Causes

FACTS
●Salas was hired as assistant utility man by respondent Aboitiz. He rose from the ranks and became material
controller. As material controller, Salas was tasked with monitoring and maintaining the availability and
supply of Quickbox needed by Aboitiz in its day-to-day operations.
●Salas had run out of Large Quickbox, hampering Aboitiz's business operation. The following day, Aboitiz
wrote Salas a memorandum requiring the latter to explain in writing why he should not be disciplinarily
dealt with for his (i) failure to monitor the stock level of Large Quickbox which led to inventory stock out; and
(ii) failure to report to [his] immediate superior the Large Quickbox problem when the stock level was
already critical, when the Large Quickbox level was near stock out, and the stock level had a stock out.
●An administrative hearing was conducted to give Salas ample opportunity to explain his side. Salas'
explanation, however, was not convincing, hence he was terminated.
●Salas then filed with the LA a complaint against Aboitiz and its president for illegal dismissal with prayer
for reinstatement, and for payment of full backwages, moral and exemplary damages, as well as attorney's
fees.
●Aboitiz responded that there was valid termination. It asserted that Salas was dismissed for just cause
and with due process. It claimed Salas willfully breached his duty when Aboitiz ran out of Large Quickbox,
justifying the termination of his employment.

ISSUE/S:
Whether Salas was validly terminated based on the ff grounds:

RULING

Loss of Trust and Confidence

NO. Salas as material controller was tasked with monitoring and maintaining the availability and supply of
Quickbox. There appears nothing to suggest that Salas' position was a highly or even primarily confidential
position, so that he can be removed for loss of trust and confidence by the employer. The term "trust and
confidence" is restricted to managerial employees or those who are vested with powers or prerogatives to
lay down and execute management policies and/or to hire transfer, suspend, lay-off, recall, discharge, assign
or discipline employees or to effectively recommend such managerial actions.

Besides, as we review the records before us, we do not see any semblance of willful breach of trust on the part
of Salas. It is true that there was erasure or alteration on the bin card. Aboitiz, however, failed to demonstrate
that it was done to cover up Salas' alleged negligence. Other than the bin card and Aboitiz's barefaced
assertion, no other evidence was offered to prove the alleged cover-up. Neither was there any showing that
Salas attempted to mislead the investigating team. The CA, therefore, erred in adopting Aboitiz's
unsubstantiated assertion to justify Salas' dismissal.

The loss of trust must be based not on ordinary breach but, in the language of Article 282(c) of the Labor
Code, on 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.
There must, therefore, be an actual breach of duty committed by the employee which must be established by
substantial evidence. In this case, Aboitiz utterly failed to establish the requirements prescribed by law and
jurisprudence for a valid dismissal on the ground of breach of trust and confidence.

Serious Misconduct

Neither can Aboitiz validate Salas' dismissal on the ground of serious misconduct for his alleged failure to
account for unused accountable forms amounting to P57,850.00. As aptly found by the NLRC, the charge came
only after Salas' dismissal. We also note that the subject accountable forms were issued to Salas in 2001.
Inexplicably, this alleged infraction was never included as ground in the notice of termination. It is clear that
such assertion of serious misconduct was a mere afterthought to justify the illegal dismissal.

Neglect of duty and breach of trust

Similarly, before the Labor Arbiter, NLRC, and CA, Aboitiz's arguments zeroed in on Salas' alleged neglect of
duty and breach of trust. It was, therefore, error for the CA to include serious misconduct, which had never
been raised in the proceedings below, as ground to sustain the legality of Salas' dismissal.

Aboitiz's reliance on the past offenses of Salas for his eventual dismissal is likewise unavailing. The correct
rule has always been that such previous offenses may be used as valid justification for dismissal from work
only if the infractions are related to the subsequent offense upon which the basis of termination is
decreed.26 While it is true that Salas had been suspended on June 1, 2000 for failure to meet the security
requirements of the company,27 and then on July 20, 2001 for his failure to assist in the loading at the fuel
depot,28 these offenses are not related to Salas' latest infraction, hence, cannot be used as added justification
for the dismissal.

Furthermore, Salas had already suffered the corresponding penalties for these prior infractions. Thus, to
consider these offenses as justification for his dismissal would be penalizing Salas twice for the same offense.
Undoubtedly, no just cause exists to warrant Salas' dismissal. Consequently, he is entitled to reinstatement to
his former position without loss of seniority rights, and to payment of backwages.

On the issue of Backwages

However, we limit the award of backwages because we find that Salas was not entirely faultless. As earlier
adverted to, Salas failed to promptly inform his immediate superior of the non-delivery of the requisitioned
items. Had Salas promptly informed Ed Dumago of the non-delivery, the incident complained of would have
been avoided. Although such negligence would not justify Salas' termination from employment in view of
the stringent condition imposed by the Labor Code on termination of employment due to gross and habitual
neglect, the same cannot be condoned, much less tolerated.

155_R.B. Michael Press vs. Galit, 545 SCRA 23, G.R. No. 153510 February 13, 2008
Facts:
Respondent was employed by petitioner R.B. Michael Press as an offset machine operator, whose work
schedule was from 8:00 a.m. to 5:00 p.m., Mondays to Saturdays, and he was paid PhP 230 a day. During his
employment, Galit was tardy for a total of 190 times, totaling to 6,117 minutes, and was absent without leave
for a total of nine and a half days, respondent was ordered to render overtime service in order to comply with
a job order deadline, but he refused to do so. The following day, February 23, 1999, respondent reported for
work but petitioner Escobia told him not to work, and to return later in the afternoon for a hearing.
Respondent Galit filed a complaint to NLRC and claimed that he was illegally dismissed, the petitioner argued
that the termination was due to just cause, it was on the ground of habitual and excessive tardiness, omitting
acts of discourtesy, disrespect in addressing superiors, failure to work overtime after having been instructed to
do so, Insubordination—willfully disobeying, defying or disregarding company authority.

Issue:

Whether the dismissal was due to just cause.

Ruling:
Yes, we rule that respondent unjustifiably refused to render overtime work despite a valid order to do
so. The totality of his offenses against petitioner R.B. Michael Press shows that he was a difficult employee. His
refusal to render overtime work was the final straw that broke the camel’s back, and, with his gross and
habitual tardiness and absences, would merit dismissal from service.
As to Due process: twin notice and hearing requirement Under the twin notice requirement, the employees
must be given two (2) notices before his employment could be terminated: (1) a first notice to apprise the
employees of their fault, and (2) a second notice to communicate to the employees that their employment is
being terminated. Not to be taken lightly of course is the hearing or opportunity for the employee to defend
himself personally or by counsel of his choice.
In the February 24, 1999 notice of dismissal, petitioners simply justified respondent’s dismissal by citing
his admission of the offenses charged. It did not specify the details surrounding the offenses and the specific
company rule or Labor Code provision upon which the dismissal was grounded.
In view of the infirmities in the proceedings, we conclude that termination of respondent was
railroaded in serious breach of his right to due process. And as a consequence of the violation of his statutory
right to due process and following Agabon, petitioners are liable jointly and solidarily to pay nominal damages
to the respondent in the amount of PhP 30,000.19.
156_San Miguel Corporation vs. National Labor Relations Commission , 551 SCRA 410, G.R. Nos. 146121-22
April 16, 2008
Facts:
Ernesto M. Ibias (respondent) was employed by petitioner SMC on 24 December 1978 initially as a CRO
operator in its Metal Closure and Lithography Plant. Respondent continuously worked therein until he
advanced as Zamatic operator. He was also an active and militant member of a labor organization called Ilaw
Buklod Manggagawa (IBM)-SMC Chapter. According to SMC’s Policy on Employee Conduct,4 absences without
permission or AWOPs, which are absences not covered either by a certification of the plant doctor that the
employee was absent due to sickness or by a duly approved application for leave of absence filed at least six
(6) days. It appears that per company records, respondent was AWOP on the following dates in 1997: 2, 4 and
11 January; 26, 28 and 29 April; and 5, 7, 8, 13, 21, 22, 28 and 29 May. For his absences on 2, 4 and 11 January
and 28 and 29 April, he was given a written warning7 dated 9 May 1997 that he had already incurred five (5)
AWOPs and that further absences would be subject to disciplinary action. For his absences on 28 and 29 April
and 7 and 8 May, respondent was alleged to have falsified his medical consultation card by stating therein that
he was granted sick leave by the plant clinic on said dates when in truth he was not.
After the completion of the investigation, SMC concluded that respondent committed the offenses of
excessive AWOPs and falsification of company records or documents, and accordingly dismissed him.
Issue:
Whether the dismissal was legal and valid.
Ruling:
Yes, we find that SMC acted well within its rights when it dismissed respondent for his numerous
absences. Respondent was afforded due process and was validly dismissed for cause. In any case, when SMC
imposed the penalty of dismissal for the 12th and 13th AWOPs, it was acting well within its rights as an
employer. An employer has the prerogative to prescribe reasonable rules and regulations necessary for the
proper conduct of its business, to provide certain disciplinary measures in order to implement said rules and to
assure that the same would be complied with.35 An employer enjoys a wide latitude of discretion in the
promulgation of policies, rules and regulations on work-related activities of the employees.

157. LBC Express v. Mateo, June 9, 2009

SECURITY OF TENURE; Just Causes
FACTS: Respondent James Mateo, designated as a customer associate, was a regular employee of LBC Express
(LBC). His job was to deliver and pick-up packages to and from LBC and its customers. For this purpose, Mateo
was assigned the use of a Kawasaki motorcycle. One day, Mateo arrived at LBC’s Escolta office, to drop off
packages coming from various LBC air posts. He parked his motorcycle directly in front of the LBC office,
switched off the engine and took the key with him. However, he did not lock the steering wheel because he
allegedly was primarily concerned with the packages, including a huge sum of money that needed to be
immediately secured inside the LBC office. He returned promptly within three to five minutes but the
motorcycle was gone.
He immediately reported the loss to his superiors at LBC and to the nearest police station. LBC, through its
vice-president, Niño, directed Mateo to appear in his office to explain his side and for formal investigation. As
directed, Mateo appeared and presented his side. After investigation, he received a notice of termination from
LBC. He was barred from reporting for work. Mateo thereafter filed a complaint for illegal dismissal, payment
of back wages and reinstatement with damages.
Labor Arbiter and NLRC ruled in favor of LBC, but CA ruled that Mateo was illegally dismissed.
ISSUE:
Whether the termination of Mateo is with just cause.
RULING:
Yes. The services of a regular employee may be terminated only for just or authorized causes, including
gross and habitual negligence under Article 282, paragraph (b) of the Labor Code.
Gross negligence is characterized by want of even slight care, acting or omitting to act in a situation where
there is a duty to act, not inadvertently but willfully and intentionally with a conscious indifference to
consequences insofar as other persons may be affected.
In this case Mateo was undisputedly negligent when he left the motorcycle along Burke Street in
Escolta, Manila without locking it despite clear, specific instructions to do so. His argument that he stayed
inside the LBC office for only three to five minutes was of no moment. On the contrary, it only proved that he
did not exercise even the slightest degree of care during that very short time. Mateo deliberately did not heed
the employer’s very important precautionary measure to ensure the safety of company property. Regardless of
the reasons advanced, the exact evil sought to be prevented by LBC (in repeatedly directing its customer
associates to lock their motorcycles) occurred, resulting in a substantial loss to LBC.

158. Genuino v. NLRC, December 4, 2007

SECURITY OF TENURE; Just Causes
FACTS: Genuino was employed by Citibank as Treasury Sales Division Head with the rank of Assistant
Vice-President. Later, Citibank sent Genuino a letter charging her with "knowledge and/or involvement" in
transactions "which were irregular or even fraudulent." In the same letter, Genuino was informed she was
under preventive suspension.
Genuino's counsel replied through a letter, demanding for a bill of particulars regarding the charges
against Genuino. Citibank's counsel replied and gave Genuino’s an opportunity to explain her side on the issue.
Genuino did not appear in the administrative investigation. Citibank's counsel noted Genuino's failure
to appear in the investigation and gave Genuino to submit her written explanation. Genuino did not submit her
written explanation.
Citibank informed Genuino of the result of their investigation. And later, Genuino's employment was
terminated by Citibank on grounds of (1) serious misconduct, (2) willful breach of the trust reposed upon her
by the bank, and (3) commission of a crime against the bank.
ISSUE: Whether or not the dismissal of Genuino is for a just cause and in accordance with due process
RULING:
The dismissal was for just cause but lacked due process. In a string of cases, we have repeatedly said
that the requirement of twin notices must be met.
In this case, the letters sent by Citibank did not identify the particular acts or omissions allegedly committed by
Genuino. While the bank gave Genuino an opportunity to deny the truth of the allegations in writing and
participate in the administrative investigation, the fact remains that the charges were too general to enable
Genuino to intelligently and adequately prepare her defense.
The two-notice requirement of the Labor Code is an essential part of due process. The first notice informing
the employee of the charges should neither be pro-forma nor vague. It should set out clearly what the
employee is being held liable for. The employee should be afforded ample opportunity to be heard and not
mere opportunity.
While the SC hold that Citibank failed to observe procedural due process, the SC find Genuino's dismissal
justified. Art. 282(c) of the Labor Code provides that an employer may terminate an employment for fraud or
willful breach by the employee of the trust reposed in him/her by his/her employer or duly authorized
representative. In order to constitute as just cause for dismissal, loss of confidence should relate to acts
inimical to the interests of the employer.
As Assistant Vice-President Genuino held a position of trust and confidence. There is no way she could deny
any knowledge of the bank's policies nor her understanding of these policies as reflected in the survey done by
the bank. She could not likewise feign ignorance of the businesses of Citibank, and of Global and Torrance.

159. EDUARDO BUGHAW, JR v. TREASURE ISLAND INDUSTRIAL CORPORATION

G.R. NO. 173151 : March 28, 2008

Facts:
Bughaw was employed as production worker by Treasure Island Industrial Corporation (TIIC). TIIC was
receiving information that many of its employees were using prohibited drugs during working hours and within
the company premises. One of TIIC employees, Loberanes was caught in flagrante delicto by the police in
possession of shabu. Loberanes implicated Bughaw in the crime by claiming that part of the money used for
buying the illegal drugs was given by the latter, and the illegal drugs purchased were for their consumption for
the rest of the month. TIIC served a Memo for Explanation to Bughaw requiring him to explain within 120
hours why no disciplinary action should be imposed against him for his alleged involvement in illegal drug
activities. He was further directed to appear at the office of TIIC’s legal counsel for the hearing on the matter.
Meantime, petitioner was placed under preventive suspension for the period of 30days effective upon receipt
of the Notice. Bughaw failed to appear before the respondent’s legal counsel on the scheduled hearing date
and to explain his side on the matter.

Respondent sent a second letter to Bughaw directing him to attend another administrative hearing but
petitioner once again failed to show up. Consequently, a third letter was sent to Bughaw, terminating his
employment for using illegal drugs within company premises during working hours, and for refusal to attend
the administrative hearing and submit written explanation on the charges hurled against him. Bughaw filed a
complaint for illegal dismissal against respondent and its President. He alleged that he had been working for
the respondent for 15 years and he was very conscientious with his job. He was suspended for 30 days on 11
June 2001 based on the unfounded allegation of his co-worker that he used illegal drugs within company
premises. When petitioner reported back to work after the expiration of his suspension, he was no longer
allowed by respondent to enter the work premises and was told not to report back to work. Labor Arbiter
rendered a Decision in favor of petitioner since the respondent failed to present substantial evidence to
establish the charge leveled against the petitioner. TIIC also failed to comply with due process when it
immediately suspended petitioner and eventually dismissed him from employment. On appeal, the NLRC
affirmed the Labor Arbiters Decision but CA reversed it. Bughaw filed a petition for review to the Supreme
Court.

Issue:
WoN petitioner was illegally dismissed from employment.
Ruling:
 Yes, The Labor Arbiter and the NLRC both ruled that petitioner was illegally dismissed from
employment and ordered the payment of his unpaid wages, backwages, and separation pay, while the Court of
Appeals found otherwise. while there was a valid ground for dismissal, the procedural requirements for
termination as mandated by law and jurisprudence were not observed.

Under the Labor Code, the requirements for the lawful dismissal of an employee are two-fold, the substantive
and the procedural aspects. Not only must the dismissal be for a just or authorized cause, the rudimentary
requirements of due process - notice and hearing - must, likewise, be observed before an employee may be
dismissed. Without the concurrence of the two, the termination would, in the eyes of the law, be illegal, for
employment is a property right of which one cannot be deprived of without due process.

Hence, the two (2) facets of a valid termination of employment are: (a) the legality of the act of dismissal, i.e.,
the dismissal must be under any of the just causes provided under Article 282 of the Labor Code; and (b) the
legality of the manner of dismissal, which means that there must be observance of the requirements of due
process, otherwise known as the two-notice rule.

Article 282 of the Labor Code enumerates the just causes for terminating the services of an employee:

ART. 282. Termination by employer. - An employer may terminate an employment for any of the following
causes:

(a) Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or
representative in connection with his work;

(b) Gross and habitual neglect by the employee of his duties;

(c) Fraud or willful breach by the employee of the trust reposed in him by his employer or his duly authorized
representative;

(d) Commission of a crime or offense by the employee against the person of his employer or any immediate
member of his family or his duly authorized representative; andcralawlibrary

(e) Other causes analogous to the foregoing.

160. JACKQUI R. MORENO v. SAN SEBASTIAN COLLEGE-RECOLETOS

G.R. NO. 175283 : March 28, 2008

Facts:
San Sebastian College (SSCR) employed Jackqui R. Moreno as a teaching fellow. She was first appointed
as a full-time college faculty member. Then, Moreno became a member of the permanent college faculty. She
was also offered the chairmanship of the Business Finance and Accountancy Department of her college. The
SSC-R HR conducted a formal investigation regarding Moreno’s unauthorized external teaching engagements
and HR found out that Moreno indeed had unauthorized teaching assignments at the Centro Escolar University
and at the College of the Holy Spirit, Manila. Moreno received a MEMO from the Dean of her college, requiring
her to explain the reports regarding her unauthorized teaching engagements. The said activities allegedly
violated Section 2.2 of Article II of SSC-R’s Faculty Manual. Moreno admitted her failure to secure any written
permission before she taught in other schools. Moreno further stated that it was never her intention to
jeopardize her work in SSC-R and that she merely wanted to improve her family’s poor financial conditions. A
Special Grievance Committee was then formed in order to investigate and make recommendations regarding
Moreno’s case.
The grievance committee required Moreno to answer the following series of questions concerning her
case the Holy Spirit and at the Centro Escolar University; that the Dean of her college was aware of her
external teaching loads that she went beyond the maximum limit for an outside load; that she did not deny
teaching part-time in the aforementioned schools; and that she did not wish to resign because she felt she
deserved a second chance. The grievance committee issued its resolution which unanimously found that she
violated the prohibition against a full-time faculty having an unauthorized external teaching load. The majority
of the grievance committee members recommended Moreno’s dismissal from employment in accordance with
the school manual, but Dean Espejo dissented and called only for a suspension for one semester. Moreno was
terminated from her work. Moreno instituted with the NLRC a complaint for illegal termination against SSC-R.
Labor Arbiter Veneranda C. Guerrero dismissed Moreno’s complaint. NLRC reversed the rulings of the Labor
Arbiter. CA annulled the decision of the NLRC. SSC-R contends that Moreno’s dismissal from employment was
valid because she knowingly violated the prohibition in Section 2.2 of Art. II of the SSC-R Faculty Manual and in
employment contract. In s doing, Moreno allegedly committed serious misconduct and willful disobedience
against the school, and thereby submitted herself to the corresponding penalty which is termination for cause

Moreno admitted she did not formally disclose her teaching loads at the College of

Issue: WoN the dismissal of petitioner was proper and lawful.

Ruling: No, the Court finds that SSC-R miserably failed to prove that Moreno's misconduct was induced by a
perverse and wrongful intent as required in Art. 282(a) of the Labor Code. SSC-R merely anchored Moreno's
alleged bad faith on the fact that she had full knowledge of the policy that was violated and that it was
relatively easy for her to secure the required permission before she taught in other schools. This posture is
utterly lacking.
In termination cases, the burden of proof rests on the employer to show that the dismissal is for just cause.
When there is no showing of a clear, valid and legal cause for the termination of employment, the law
considers the matter a case of illegal dismissal and the burden is on the employer to prove that the
termination was for a valid or authorized cause. On the basis of the evidence on record, the Court finds that
Moreno has indeed committed misconduct against respondent SSC-R. Her admitted failure to obtain the
required permission from the school before she engaged in external teaching engagements is a clear
transgression of SSC-R's policy. However, said misconduct falls below the required level of gravity that would
warrant dismissal as a penalty.
Under Art. 282(a) of the Labor Code, willful disobedience of the employer's lawful orders as a just cause for
termination of employment envisages the concurrence of at least two requisites: (1) the employee's assailed
conduct must have been willful or intentional, the willfulness being characterized by a "wrongful and
perverse attitude"; and (2) the order violated must have been reasonable, lawful, made known to the
employee and must pertain to the duties which he has been engaged to discharge.27
However, the Court does not depreciate the misconduct committed by Moreno.
Indeed, SSC-R has adequate reasons to impose sanctions on her. But this should not be dismissal from
employment. Because of the serious implications of this penalty, "our Labor Code decrees that an employee
cannot be dismissed, except for the most serious causes."

161. Janssen Pharmaceutica v. Silayro

G.R. No. 172528 Date: February 26, 2008 Ponente: Chico-Nazario, J.
FACTS:
● Herein respondent Benjamin Silayro received several awards from the petitioner pharmacy during his
employment therein from 1990 – 1997. However, Silayro was found out to be guilty of several
administrative charges such as unauthorized granting of premium/free goods, unauthorized pull-outs,
dishonesty with the Rewards of Learning (ROL). Silayro denies granting unauthorized pull-outs.
● The pharmacy sent a letter to Sialyro requiring him to explain his delay in submitting process reports.
Silayro explained that the delay was caused by the death of his grandmother and aunt as well as the
hospitalization of his mother. To add, the issue with his co-employee answering his ROL was due to him
needing to leave to see his father-in-law who was suffering from cancer.
● Time and again Silayro was sent memos for his delayed submission of process reports, and
discrepancies in his Daily/Weekly Coverage Report (DCR). Silayro admitted to committing errors in
counting the samples in his possession as opposed to what was reflected in his DCR.
● Later, petitioner pharmacy issued a Notice of Disciplinary Action finding respondent guilty of the
following offenses (1) delayed submission of process reports, for which he was subjected to a one-day
suspension without pay, effective 24 November 1998; and (2) cheating in his ROL test, for which he was
subjected again to a one-day suspension.
● On the same date, petitioner likewise issued a Notice of Preventive Suspension against respondent for
"Dishonesty in Accomplishing Other Accountable Documents" in connection with the discrepancy
between the quantities of sample products in respondent’s report and the petitioner’s audit for the
September 1998 cycle. The notice also directed Silayro to surrender his accountabilities to the
pharmacy.
● By 1998, the pharmacy terminated the services of Silayro under the grounds of dishonesty, being a
habitual offender and failure to return his accountabilities in violation of the Code of Conduct.
● This prompted Silayro to file a complaint before the NLRC of Iloilo City. The LA therein ruled that Silayro
committed infractions which breached company rules, and which were sufficient grounds for dismissal.
● On appeal to the NLRC, the commission ruled that Silayro was dismissed for just causes. The CA, on the
other hand, declared the dismissal of Silayro as illegal. Hence, the present petition.

ISSUE:
● Whether the violations committed by Silayro falls under the just causes provided in the Labor Code that
would warrant his dismissal?
 ● Whether the pharmacy correctly observed procedural due process in terminating the services of Silayro
based on just causes?

RULING:
● NO. The Supreme Court concluded that Respondent’s violations of petitioner’s Code of Conduct, even
if taken as a whole, would not fall under the just causes of termination provided under Article 282 of
the Labor Code. They are mere blunders, which may be corrected. Petitioner failed to point out even a
potential danger that respondent would misappropriate or improperly dispose of company property
placed in his custody. It had not shown that during his employment, respondent took a willfully defiant
attitude against it. It also failed to show a pattern of negligence which would indicate that respondent
is incapable of performing his responsibilities. At any other time during his employment, respondent
had shown himself a commendable worker. Nonetheless, the infractions committed by the respondent,
while disproportionate to a penalty of dismissal, will not be overlooked. The suspension of five months
without pay, imposed by the Court of Appeals, would serve as a sufficient and just punishment for his
violations of the company’s Code of Conduct.
● NO. For termination of employment based on just causes as defined in Article 282 of the Labor Code:
o (i) A written notice served on the employee specifying the ground or grounds for termination,
and giving said employee reasonable opportunity within which to explain his side.
o (ii) A hearing or conference during which the employee concerned, with the assistance of
counsel if he so desires is given opportunity to respond to the charge, present his evidence, or
rebut the evidence presented against him.
o (iii) 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 superficial compliance with two notices and a hearing in this case cannot be considered valid
where these notices were issued and the hearing made before an offense was even committed.
Since petitioner’s ostensible compliance with the procedural requirements of notice and hearing
took place before an offense was even committed, respondent was robbed of his rights to explain
his side, to present his evidence and rebut what was presented against him, rights ensured by the
proper observance of procedural due process.
Digested by: Maadil, Jedimir A.

162. Suico et. al. v. NLRC

G.R. No. 146762 Date: January 30, 2007 Ponente: Austria-Martinez, J.

FACTS:
● The case concerns 3 consolidated cases:
● GR No. 146762 concerns the strike performed by Suico, Ceniza and Dacut [complainants] against PLDT.
Due to this strike, a certain Ann Fernando was injured prompting Emiliano Tanchico [VP for Personnel
Management of PLDT] to send notices to the 3 complainants as to why they should not be terminated
for participating in an alleged illegal strike. The 3 complainants did not file their answers but merely
requested a formal hearing. PLDT division head Cotelo deferred any action as to the request for a
 formal hearing pending the complainants’ answers to the charge. The complainants merely reiterated
their request prompting Cotelo to send them termination notices for their failure to provide an
explanation as to their participation in an illegal strike. This prompted the complainants to file a
complaint for illegal dismissal before the Labor Arbiter (LA). The LA declared their dismissal as illegal
which was set aside by the NLRC by an appeal from PLDT. The CA affirmed the decision of the NLRC.
● GR 153584 concerns a strike by the MPK against PLDT of which petitioner Benigno Mariano was a
member of. It was alleged that a certain Melvyn Guillermo was injured due to a striker which was
identified as Mariano. As such, VP Tanchico sent a notice to Mariano requesting he explain why he
should not be terminated. Mariano did not reply. PLDT Asst. VP Puzon thereafter sent Mariano a notice
of termination of his employment informing him that his act constitutes as a just cause for termination
under the Labor Code. Mariano filed an illegal dismissal case before the LA but was dismissed. Mariano
appealed before the NLRC and the CA to no avail.
● GR 163793 also concerns a strike made against PLDT by members of MPK which respondent Ernesto
Borje was a member. VP Tanchico sent a notice to Borje requesting why he should not be terminated
for hurling stones to employees of PLDT. Borje replied electing his right to be heard and defend himself
in a formal hearing. VP Puzon thereafter sent to Borje a notice of termination of his employment. Borje
then filed before the LA a complaint for illegal dismissal which was dismissed. The NLRC also dismissed
Borje’s appeal. The CA, however, reversed the LA decision and ruled in favor of Borje.
● Hence, the consolidated cases. It is the view of PLDT that in the dismissal of employees for
strike-related violence, it is sufficient to merely declare the latter to have lost their employment
without having to comply with any procedure for their termination.

ISSUE:
● Whether PLDT correctly observed the requirement of procedural due process in terminating the
employment of the complainants under the ground of just cause?

RULING:
● NO. The Supreme Court concluded that PLDT is mistaken. Art. 277 (b) in relation to Art. 264 (a) and
(e) of the Labor Code recognizes the right to due process of all workers, without distinction as to the
cause of their termination. Where no distinction is given, none is construed. Hence, the foregoing
standards of due process apply to the termination of employment of Suico, et al. even if the cause
therefor was their supposed involvement in strike-related violence prohibited under Art. 264 (a) and
(e).
● Moreover, the procedure for termination prescribed under Art. 277(b) and Rule XXII of the
Implementing Rules of Book V is supplemented by existing company policy. Art. 277(b) provides that
the procedure for termination prescribed therein is without prejudice to the adoption by the employer
of company policy on the matter, provided this conforms with the guidelines set by the DOLE such as
Rule XXII of the Implementing Rules of Book V. This is consistent with the established principle that
employers are allowed, under the broad concept of management prerogative, to adopt company
policies that regulate all aspects of personnel administration including the dismissal and recall of
workers. All told, the procedure adopted by PLDT in dismissing Suico, et al. fell short of the
requirements of due process.

Digested by: Maadil, Jedimir A.

163. Perez & Doria v. PT&T
G.R. No. 152048 April 7, 2009 Corona, J
Security of Tenure; Just Causes

FACTS:
● Perez and Doria were employed as shipping clerk and supervisor in PT&T’s Shipping Section, Materials
Management Group.
● It was discovered that the Shipping Section jacked up the value of the freight costs for goods shipped
and that the duplicates of the shipping documents allegedly showed traces of tampering, alteration and
superimposition.
● Petitioners were placed on preventive suspension for 30 days for their alleged involvement in the
anomaly It was extended for 15 days twice. Then a memorandum was issued hereby dismissing them
from service for having falsified company documents.
● Petitioners filed a complaint for illegal suspension and dismissal.
● LA found that the 30-day extension of suspension and dismissal were both illegal. He ordered
respondents to pay petitioners their salaries during 30-day illegal suspension and to reinstate them
with backwages and 13th month pay.
● NLRC reversed the decision. It ruled that petitioners were dismissed for just cause, that they were
accorded due process and that they were illegally suspended for only 15 days (witout stating the reason
for the reduction of the period of petitioners’ illegal suspension.
● Petitioners appealed to CA. Ca affirmed NLRC decision. However, it found that petitioners were
dismissed without due process.
● Petitioners now seek a reversal of the CA decision.

ISSUE: Whether the petitioners were dismissed without just cause and without due process.

RULING: Yes. The respondents’ evidence insufficient to clearly and convincingly establish the facts from
which the loss of confidence resulted. Other than the bare allegations and the fact that such documents came
into petitioners’ hands at some point, respondents should have provided evidence of petitioners’ functions,
the extent of their duties, the procedure in the handling and approval of shipping requests and the fact that no
personnel other than petitioners were involved. There was, therefore, a patent paucity of proof connecting
petitioners to the alleged tampering of shipping documents.
The burden of proof rests on the employer to establish that the dismissal is for cause in view of the
security tenure that employees enjoy under the Labor Code. The employer’s evidence must clearly and
convincingly show the facts on which the loss of confidence in the employee may be fairly made to rest. it
must be adequately proven by substantial evidence. respondent failed to discharge this burden.
The Constitution guarantees security of tenure to labor, which the Labor Code implements by
requiring that there be a just or authorized cause before an employer can terminate the services of a worker.
This is the equivalent of an what would have satisfied substantive due process had a State action been
involved. The equivalent of procedural due process is detailed under Article 277 of the LC, which requires
notice and ample opportunity to be heard, both which are fleshed out in the Implementing Rules of Book VI
and in Rule XXIII of the D.O. No. 9, Series of 1997, of DOLE.
 Two notice requirement for terminating employees; Respondents’ illegal act of dismissing petitioners
was aggravated by their failure to observe due process. To meet the requirements of due process in the
dismissal of an employee, an employer must furnish the worker with 2 notices: (1) a written notice specifying
the grounds for termination and giving to said employee a reasonable opportunity to explain his side and (2)
another written notice indicating that, upon due consideration of all circumstances, grounds have been
established to justify the employer’s decision to dismiss the employees.
Omar

164. Bacolod-Talisay Realty v. Dela Cruz

G.R. No. 179563 April 30, 2009 Carpio-Morales, J.
Security of Tenure; just cause

FACTS:
● Romeo de la Cruz was dismissed on charges of payroll padding, selling canepoints without the
knowledge and consent of management and misappropriating the proceeds and renting out BTRD’s
tractor for use in another farm and misappropriating the proceeds.
● Respondent filed a complaint for illegal suspension and illegal dismissal before NLRC against BTRD. In
his position paper, he claimed that on June 4, 1997, he received a June 3, 1997 letter informing him
that he was being suspended for the next 30 days and that there was an ongoing investigation; and
after 30 days his wife received a letter dated June 3, 1997 stating that he was terminated from service
on account of the charges.
● LA dismissed respondent’s complaint for lack of merit. And the NLRC dismissed respondent’s appeal for
not being verified.
● CA found that petitioners did not comply with the guideline for the dismissal of the employee and
reversed the NLRC decision. Hence, the petition.

ISSUE: Whether BTRD observed due process in dismission de la Cruz.

RULING: The Court of Appeals correctly held though that Bacolod-Talisay did not comply with the proper
procedure in dismissing respondent. In other words, Bacolod-Talisay failed to afford dela Cruz due process
by failing to comply with the twin notice requirement in dismissing him, viz: 1) a first notice to apprise him
of his fault, and 2) a second notice to him that his employment is being terminated.
The letter dated June 3, 1997 sent to dela Cruz was a letter of suspension. It did not comply with the
required first notice, the purpose of which is to apprise the employee of the cause for termination and to give
him reasonable opportunity to explain his side.

In fine, while the dismissal of dela Cruz was for a just cause, the procedure in effecting the same was not
observed.
Omar

165. PRUDENTIAL GUARNTEE & ASSURANCE LABOR UNION vs. NLRC

G.R. No. 185335 June 13, 2012 Mendoza, J.
Security of Tenure; Just Causes

FACTS:
 Prudential Guarantee and Assurance Inc. (PGAI) conducted an on-the-spot security check in the IT
department, beginning with Sandy Vallota’s computer; he was a Junior Programmer and the Union Board of
Director. They found a folder named “MAA” and asked him if he was working for them; he answered “Hindi po,
MAA mutual life po yan na makikita po sa internet.” Sensing that Vallota was being singled out, the Union
insisted that all the computers be checked. The contents of the folder were printed and signed by Vallota and
the Union Secretary; he was not given copies. He was ordered to explain why highly confidential files were on
his computer, and preventively suspended pending the administrative case against him. He was eventually
dismissed. The union filed a complaint for illegal dismissal.
The LA ruled in their favor, finding that PGAI failed to meet its burden of evidence, the dismissal was
not commensurate to the misconduct complained of (considering it was Vallota’s first offense, and he was
denied due process since PGAI refused to conduct a hearing. The NLRC reversed and found that PGAI had
submitted substantial and sufficient evidence to prove that there existed grounds for the PGAI to lose trust and
confidence in Vallota.

ISSUE:
Was Vallota validly dismissed on the ground of loss of trust and confidence?

RULING:
No. To be a valid ground for dismissal, loss of trust and confidence must be based on willful breach of
trust and founded on clearly established facts. 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 remain eternally at the mercy of the employer. Further, in order to
constitute a just cause, the act complained of must be work-related and show that the employee is unfit to
continue working for the employer.
In this case, there was no other evidence presented to prove fraud in the manner of securing or
obtaining the files found in Vallota’s computer. In fact, aside from the presence of these files in Vallota’s hard
drive, there was no other evidence to prove any gross misconduct on his part. There was no proof either that
the presence of such files was part of an attempt to defraud his employer or to use the files for a purpose
other than that for which they were intended. If anything, the presence of the files reveals some degree of
carelessness or neglect in his failure to delete them, but it is an extremely farfetched conclusion bordering on
paranoia to state that it is part of a larger conspiracy involving corporate espionage.
Moreover, contrary to PGAI’s allegations, the MAA files found in Vallota’s computer, the prospectus and
corporate profile, are not sensitive corporate documents. These are documents routinely made available to
the public, and serve as means to inform the public about the company and to disseminate information about
the products it sells or the services it provides, in order that potential clients may make a sound and informed
decision whether or not to purchase or avail of such goods and services.

166. COSMOS BOTTLING CO. vs. FERMIN

G.R. NoS. 193676 & 194303 June 20, 2012 Sereno, J.
Security of Tenure; Just Causes

FACTS:
 Wilson Fermin, a forklift operator at Cosmos for 27 years, was accused of and found guilty of stealing
his fellow employee Braga’s phone, which he hid in his locker as a practical joke and had every intention of
returning. Following Fermin’s dismissal, Braga withdrew his complaint as he believed it was a prank, but the
company still dismissed the former.
Cosmos argues that: (a) Fermin committed a clear act of bad faith and dishonesty in taking the
cellphone of Braga and denying knowledge thereof; (b) the latter’s recantation was a mere afterthought; (c)
the lack of material damage or prejudice on the part of COSMOS does not preclude it from imposing the
penalty of termination; and (d) the previous infractions committed by Fermin strengthen the decision of
COSMOS to dismiss him from service.
ISSUE:
Was Fermin’s dismissal appropriate?
RULING:
Yes. Theft committed against a co-employee is considered as a case analogous to serious misconduct
for which the penalty of dismissal from service may be meted out to the erring employee. Article 282 of the
Labor Code provides:
Article 282. Termination by Employer. - An employer may terminate an employment for any of the
following causes: (a) Serious misconduct or willful disobedience by the employee of the lawful orders
of his employer or his representatives in connection with his work;
(e) Other causes analogous to the foregoing.
Misconduct involves "the transgression of some established and definite rule of action, forbidden act, a
dereliction of duty, willful in character, and implies wrongful intent and not mere error in judgment." For
misconduct to be serious and therefore a valid ground for dismissal, it must be:
1. of grave and aggravated character and not merely trivial or unimportant and
2. connected with the work of the employee.
In this case, the LA has already made a factual finding, which was affirmed by both the NLRC and the
CA, that Fermin had committed theft when he took Braga’s cellphone. Thus, this act is deemed analogous to
serious misconduct, rendering Fermin’s dismissal from service just and valid.

167. Sampaguita Auto Transport v. NLRC & Sagad, January 30, 2013
Just Causes

FACTS: Sagad alleged that on May 14, 2006, the company hired him as a regular bus driver, not as
aprobationary employee as the company claimed. He disowned his purported signature on the contract of
probationary employment submitted in evidence by the company. He maintained that his signature was
forged. He further alleged that on November 5, 2006, he was dismissed y the company for allegedly conniving
with conductor Vitola in issuing tickets outside their assigned route. The company countered that it employed
Sagad as a probationary bus driver from May 14, 2006 to October 14, 2006; he was duly informed of his
corresponding duties and responsibilities. He was further informed that during the probationary period, his
attendance, performance and work attitude shall be evaluated to determine whether he would qualify for
regular employment. For this purpose and as a matter of company policy, an evaluator was deployed on a
company bus (in the guise of a passenger) to observe the driver's work performance and attitude.
Allegedly, on September 21, 2006, an evaluator boarded Sagad's bus. The evaluator describedSagad's
manner of driving as "reckless driver, nakikipaggitgitan, nakikipaghabulan, nagsasakaysa gitna ng kalsada,
sumusubsob ang pasahero[.] “Sagad disputed the evaluator's observations. In an explanation (rendered in
Filipino), he claimed that he could not have been driving as reported because his wife (who was pregnant) and
one of his children were with him on the bus. He admitted though that at one time, he chased an "Everlasting"
bus to serve warning on its driver not to block his bus when he was overtaking. He also admitted that once in a
while, he sped up to make up for lost time in making trips.
The company further alleged that on October 13, 2006, it conducted a thorough evaluation of Sagad's
performance. It requested conductors who had worked with Sagad to comment on his work. Conductors A.
Hemoroz and Israel Lucero revealed that Sagad proposed that they cheat on the company by way of an
unreported early bus trip.
The company also cited Sagad'sinvolvement in a hit-and-run accident on September 9, 2006 along
Commonwealth Avenue inQuezon City while on a trip. Allegedly, Sagad did not report the accident to the
company.On October 15, 2006, upon conclusion of the evaluation, the company terminated Sagad's
employment for his failure to qualify as a regular employee.

ISSUE:
1. Whether Sagad’s Termination falls under just causes.

RULING:

Yes. The CA misappreciated the law when it declared that the grounds relied upon by the company in
terminating Sagads employment are not among those enumerated under Article 282 of the Labor Code as just
causes for employee dismissals. Article 282 of the Code provides:

Art. 282. Termination by employer. An employer may terminate an employment for any of the following
causes:c

(a) Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or
representative in connection with his work;

(b) Gross and habitual neglect by the employee of his duties;

(c) Fraud or willful breach by the employee of the trust reposed in him by his employer or duly authorized
representative;

(d) Commission of a crime or offense by the employee against the person of his employer or any immediate
member of his family or his duly authorized representative; and

(e) Other causes analogous to the foregoing. [emphasis supplied] ???

The irregularities or infractions committed by Sagad in connection with his work as a bus driver constitute a
serious misconduct or, at the very least, conduct analogous to serious misconduct, under the above-cited
Article 282 of the Labor Code. To be sure, his tendency to speed up during his trips, his reckless driving, his
picking up passengers in the middle of the road, his racing with other buses and his jostling for vantage
positions do not speak well of him as a bus driver. While he denies being informed, when he was hired, of the
duties and responsibilities of a driver contained in a document submitted in evidence by the company48 the
requirement "3. to obey traffic rules and regulations as well as the company policies. 4. to ensure the safety of
the riding public as well as the other vehicles and motorist (sic)"49 is so fundamental and so universal that any
bus driver is expected to satisfy the requirement whether or not he has been so informed.

All told, we find substantial evidence supporting Sagads removal as a bus driver. Through his reckless driving
and his schemes to defraud the company, Sagad committed serious misconduct and breach of the trust and
confidence of his employer, which, without doubt, are just causes for his separation from the service. It is well
to stress, at this point, an earlier pronouncement of the Court "that justice is in every case for the deserving, to
be dispensed in the light of the established facts and applicable law and doctrine."

168. Dongon v. Rapid Movers, August 28, 2013

Just Causes

FACTS: Petitioner Rapid is engaged in the hauling and trucking business while private respondent Nathaniel T.
Dongon is a former truck helper leadman. Private respondents area of assignment is the Tanduay Otis
Warehouse where he has a job of facilitating the loading and unloading of the petitioners trucks. On 23 April
2001, private respondent and his driver, Vicente Villaruz, were in the vicinity of Tanduay as they tried to get
some goods to be distributed to their clients.
Tanguay's security guard called the attention of private respondent as to the fact that Mr. Villaruz was
not wearing an Identification Card (I.D. Card). Private respondent, then, assured the guard that he will secure a
special permission from the management to warrant the orderly release of goods.
Instead of complying with his compromise, private respondent lent his I.D. Card to Villaruz; and by
reason of such misrepresentation, private respondent and Mr. Villaruz got a clearance from Tanduay for the
release of the goods. However, the security guard, who saw the misrepresentation committed by private
respondent and Mr. Villaruz, accosted them and reported the matter to the management of Tanduay.
After conducting an administrative investigation, private respondent was dismissed from the
petitioning Company. Private respondent filed a case for illegal dismissal against the company. LA dismissed
the complaint. On appeal, however, the NLRC reversed the Labor Arbiter, and held that Rapid Movers had not
discharged its burden to prove the validity of petitioners dismissal from his employment and that his dismissal
was a penalty disproportionate to the act of petitioner complained of. It awarded him backwages and
separation pay in lieu of reinstatement.
Rapid Movers brought a petition for certiorari in the CA, averring grave abuse of discretion on the part
of the NLRC. The CA promulgated its assailed decision reinstating the decision of the Labor Arbiter, and
upholding the right of Rapid Movers to discipline its workers. Petitioner filed a motion for reconsideration but
the same was denied hence, petitioner appealed to the SC.

ISSUE:
1. Whether or not Petitioner should be dismissed;
2. Petitioner was not guilty of willful disobedience; hence, his dismissal was illegal

RULING:
1. Petition should not be dismissed. The Court deems it proper to allow due course to the petition as one for
certiorari under Rule 65 in the broader interest of substantial justice, particularly because the NLRC’s appellate
adjudication was set aside by the CA, and in order to put at rest the doubt that the CA, in so doing, exercised
its judicial authority oppressively. Whether the petition was proper or not should be of less importance than
whether the CA gravely erred in undoing and setting aside the determination of the NLRC as a reviewing forum
vis-à-vis the Labor Arbiter. We note in this regard that the NLRC had declared the dismissal of petitioner to be
harsh and not commensurate to the infraction committed. Given the spirit and intention underlying our labor
laws of resolving a doubtful situation in favor of the working man, we will have to review the judgment of the
CA to ascertain whether the NLRC had really committed grave abuse of its discretion. This will settle the
doubts on the propriety of terminating petitioner, and at the same time ensure that justice is served to the
parties.
2. Petitioner was not guilty of willful disobedience; hence, his dismissal was illegal

Petitioner maintains that willful disobedience could not be a ground for his dismissal because he had acted in
good faith and with the sole intention of facilitating deliveries for Rapid Movers when he allowed Villaruz to
use his company ID.
Willful disobedience to the lawful orders of an employer is one of the valid grounds to terminate an employee
under Article 296 (formerly Article 282) of the Labor Code.19 For willful disobedience to be a ground, it is
required that: (a) the conduct of the employee must be willful or intentional; and (b) the order the employee
violated must have been reasonable, lawful, made known to the employee, and must pertain to the duties that
he had been engaged to discharge.20 Willfulness must be attended by a wrongful and perverse mental
attitude rendering the employee’s act inconsistent with proper subordination.21 In any case, the conduct of
the employee that is a valid ground for dismissal under the Labor Code constitutes harmful behavior against
the business interest or person of his employer.22 It is implied that in every act of willful disobedience, the
erring employee obtains undue advantage detrimental to the business interest of the employer.
Under the foregoing standards, the disobedience attributed to petitioner could not be justly characterized as
willful within the contemplation of Article 296 of the Labor Code. He neither benefitted from it, nor thereby
prejudiced the business interest of Rapid Movers. His explanation that his deed had been intended to benefit
Rapid Movers was credible. There could be no wrong or perversity on his part that warranted the termination
of his employment based on willful disobedience.

(169.) ALILEM CREDIT COOP v. BANDIOLA

G.R. No. 173489 February 25, 2013 PERALTA, J.:
JUST CAUSES

FACTS: 
Respondent was employed by petitioner as bookkeeper. Petitioner's Board of Directors (the Board)
received a letter from a certain Napoleon Gao-ay (Napoleon) reporting the alleged immoral conduct and
unbecoming behavior of respondent by having an illicit relationship with Napoleon sister, Thelma G. Palma
(Thelma). This prompted the Board to conduct a preliminary investigation. During the preliminary
investigation, the Board received evidence of respondent alleged extramarital affair. Respondent, on the other
hand, denied the accusation against him. He, instead, claimed that the accusation was a result of the insecurity
felt by some members of the cooperative and of the Board because of his growing popularity owing to his
exemplary record as an employee. Thelma executed an affidavit likewise denying the allegations of
extra-marital affair.
Meanwhile, on June 7, 1997, the Board received a petition from about fifty members of the
cooperative asking the relief of respondent due to his illicit affair with Thelma.
In its Summary Investigation Report, the Ad Hoc Committee of petitioner concluded that respondent
was involved in an extra-marital affair with Thelma. On July 10, 1997, the Chairman of the Board sent a letterto
respondent informing him of the existence of a prima facie case against him for "illicit marital affair, an act that
brings discredit to the cooperative organization and a cause for termination per AMPC (Alilem Multi-Purpose
Cooperative) Personnel Policy. Respondent was directed to appear and be present at the AMPC office for a
hearing. He was likewise advised of his right to be assisted by counsel.
On the day of the hearing, respondent requested for postponement on the ground that his lawyer was
not available. The request was, however, denied and the hearing proceeded as scheduled.
In a Memorandum dated July 16, 1997, respondent was informed of Board Resolution No. 05, series of
1997 embodying the Board decision to terminate his services as bookkeeper of petitioner, effective July 31,
1997, without any compensation or benefit except the unpaid balance of his regular salary for services actually
rendered.
Aggrieved, respondent filed a Complaint for Illegal Dismissal against petitioner before the Regional
Arbitration Branch of the NLRC.
On April 30, 1998, the Labor Arbiter (LA) dismissed respondent complaint for lack of merit. The LA
concluded that respondent had been or might still be carrying on an affair with a married woman. The LA
found it unforgiving in the case of a married employee who sleeps with or has illicit relations with another
married person for in such case, the employee sullies not only the reputation of his spouse and his family but
the reputation as well of the spouse of his paramour and the latter family. As opposed to respondent claim
that the accusation is a mere fabrication of some of the directors or cooperative members who were allegedly
envious of his growing popularity, the LA gave more credence to the testimonies of petitioner witnesses who
were relatives of Thelma and who had no motive to falsely testify because their family reputation was likewise
at a risk of being tarnished. The LA, thus, found respondent to have been validly dismissed from employment
for violation of the cooperative Personnel Policy. The LA also found no violation of respondent right to due
process as he was given ample opportunity to defend himself from the accusation against him.
On appeal, the NLRC set aside the LA decision. The NLRC found petitioner Personnel Policy to be of
questionable existence and validity because it was unnumbered. It held that even assuming that respondent
had an extra-marital affair with a married woman, the latter is not his fellow worker in petitioner business
establishment. It, thus, concluded that respondent dismissal was not founded on any of the just causes for
termination of employment under Article 282 of the Labor Code, as amended.
Petitioner elevated the matter to the CA, but it failed to obtain a favorable decision. Petitioner now
comes before the Court in this petition for review on certiorari insisting on the validity of respondent dismissal
from employment.

ISSUE: Whether or not petitioner illegally dismissed respondent.

RULING:
The Court of Appeals decision is reversed and set aside. It is undisputed that respondent was
dismissed from employment for engaging in extramarital affairs, a ground for termination of employment
stated in petitioner Personnel Policy. This basis of termination was made known to respondent as early as the
first communication made by petitioner. In its June 20, 1997 letter, petitioner directed respondent to explain in
writing or personal confrontation why he should not be terminated for violation of Section 4.1.4 of the
Personnel Policy. Respondent merely denied the accusation against him and did not question the basis of such
termination. When the LA was called upon to decide the illegal dismissal case, it ruled in favor of petitioner
and upheld the basis of such dismissal which is the cited Personnel Policy. The NLRC, however, refused to
recognize the existence and validity of petitioner Personnel Policy on which the ground for termination was
embodied.
The existence of the Personnel Policy containing provisions on the grounds for termination of
employees was not questioned by respondent. In his position paper, respondent only assailed the effectivity of
the policy, as for him as it was amended on the same date as the letter-complaints against him. In other words,
he claimed that the policy was amended in order to include therein the ground for his termination to make
sure that he is removed from his position.
Contrary to respondent claim, with the amendment of the Personnel Policy, petitioner did not create a
new ground for the termination of employment to make sure that respondent is removed from his position.
The ground under the old policy is similar to that provided for in the new policy. The enumeration containing
the specific act of "illicit marital affairs" is not an additional ground, but an example of an act that brings
discredit to the cooperative. It is merely an interpretation of what petitioner considers as such. It is, thus, clear
from the foregoing that engaging in extra-marital affairs is a ground for termination of employment not only
under the new but even under the old Personnel Policy of petitioner. The effectivity of the policy as to
respondent cannot, therefore, be questioned.
To be sure, an employer is free to regulate all aspects of employment. It may make reasonable rules
and regulations for the government of its employees which become part of the contract of employment
provided they are made known to the employee. In the event of a violation, an employee may be validly
terminated from employment on the ground that an employer cannot rationally be expected to retain the
employment of a person whose lack of morals, respect and loyalty to his employer, regard for his employer
rules and application of the dignity and responsibility, has so plainly and completely been bared.
Applying now the above-discussed ground for termination, we now determine whether respondent
was properly dismissed from employment. In other words, did petitioner adequately prove that respondent
indeed engaged in extra-marital affairs, an act which petitioner considers as would bring discredit to the
cooperative?
We answer in the affirmative. The employer evidence consists of sworn statements of either relatives
or friends of Thelma and respondent. They either had direct personal knowledge of the illicit relationship or
revealed circumstances indicating the existence of such relationship.
There is also no reason to doubt the statement of Melanie Gao-ay, the wife of Napoleon, who
witnessed the embarrassing "encounter", to borrow the term she used, between [respondent] and Thelma in
her own boarding house.
While respondent act of engaging in extra--marital affairs may be considered personal to him and does
not directly affect the performance of his assigned task as bookkeeper, aside from the fact that the act was
specifically provided for by petitioner Personnel Policy as one of the grounds for termination of employment,
said act raised concerns to petitioner as the Board received numerous complaints and petitions from the
cooperative members themselves asking for the removal of respondent because of his immoral conduct.
 The next question is whether procedural due process was observed in the termination of respondent
services. "Before the services of an employee can be validly terminated, the employer must furnish him two
written notices: (a) a written notice served on the employee specifying the ground or grounds for termination,
and giving the employee reasonable opportunity to explain his side; and (b) 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 employer must inform the employee of the charges against him and
to hear his defenses. A full adversarial proceeding is not necessary as the parties may be heard through
pleadings, written explanations, position papers, memorandum or oral argument.
In this case, respondent was adequately afforded the opportunity to defend himself and explain the
accusation against him. Upon receipt of the complaint, petitioner conducted a preliminary investigation and
even created an Ad Hoc Committee to investigate the matter. Respondent was directed to explain either in
writing or by a personal confrontation with the Board why he should not be terminated for engaging in illicit
affair. Not only did petitioner give him the opportunity but respondent in fact informed petitioner that he
opted to present his side orally and did so as promised when he specifically denied such allegations. Moreover,
respondent was also allowed to peruse the investigation report prepared by the Ad Hoc Committee and was
advised that he was entitled to assistance of counsel. Afterwhich, hearing was conducted. It was only after
thorough investigation and proper notice and hearing to respondent that petitioner decided whether to
dismiss the former or not. The decision to terminate respondent from employment was embodied in Board
Resolution No. 05, series of 1997 a copy of which was furnished respondent. With this resolution, respondent
was adequately notified of petitioner decision to remove him from his position. Respondent cannot now claim
that his right to due process was infringed upon. GRANTED.

(170).CAVITE APPAREL, INCORPORATED vs.MICHELLE MARQUEZ

G.R. No. 172044, 06 February 2013

JUST CAUSES

FACTS:
Michelle was hired as a regular employee in the Finishing Department. She committed 4 AWOL. When
she reported back to work, she submitted the necessary medical certificates. Nevertheless, Cavite Apparel
suspended Michelle for 6 days. When Michelle returned, Cavite Apparel terminated her employment for
habitual absenteeism.

ISSUE:
WON a spread out four absences without leave constitutes gross and habitual neglect and therefore a
just cause for dismissal.

RULING:
NO. Michelle’s four absences were not habitual; “totality of infractions” doctrine not applicable.
Neglect of duty, to be a ground for dismissal under Article 282 of the Labor Code, must be both gross and
habitual. Gross negligence implies want of care in the performance of one’s duties. Habitual neglect imparts
repeated failure to perform one’s duties for a period of time, depending on the circumstances.
 Four absences in her six years of service cannot be considered gross and habitual neglect of duty,
especially so since the absences were spread out over a six-month period. Michelle’s penalty of dismissal is too
harsh or not proportionate to the infraction she committed.
Although Michelle was fully aware of the company rules regarding leaves of absences, and her
dismissal might have been in accordance with the rules, it is well to stress that the Supreme Court is not bound
by such rules.
While management’s prerogative is recognized to discipline its employees, the exercise of this
prerogative should at all times be imposed on an employee. Where a penalty less punitive may suffice,
whatever missteps may be committed by labor ought not to be visited with a consequence so severe for what
is at stake is not merely the employee’s position but his very livelihood and perhaps the life and substance of
his family.

171. Bravo vs. Urios College

G.R. No. 198066. June 7, 2017 Leonen, J.
Art 297. Termination based on just causes

FACTS:
Bravo was employed as a part-time teacher in 1988 by Urios College. In 2002, he was likewise
designated as the school’s comptroller. For school year 2001-2002, the College organized a committee to
formulate a new ranking system for nonacademic employees, by reason of which the position of Comptroller
was classified as a middle management position. As a result, his salary scale was adjusted to reflect the new
ranking system.
For the next school year 2002-2003, another committee was formed to adopt yet another new ranking
system. Meanwhile, the College decided to undertake a structural reorganization. It organized a committee to
review the ranking system implemented for 2001-2002, and it found that the ranking system caused salary
distortions among several employees, and that there were discrepancies in the salary adjustments of some
employees, including Bravo.
The committee discovered that the Comptroller’s Office solely prepared and implemented the salary
adjustment schedule without prior approval from the HR Department. Thus, Bravo received a show cause
memo requiring him to explain in writing why his services should not be terminated for his alleged acts of
serious misconduct. A committee was organized to investigate, which later found Bravo guilty of serious
misconduct for which he was ordered to return the sum representing overpayment of his salary. Ten days later,
he was notified of the College’s decision to terminate his services. The LA dismissed his complaint for illegal
dismissal for lack of merit, while the NLRC found that he was illegally dismissed. The CA, on appeal, ruled that
the College had substantial basis to dismiss him from service since he occupied a highly sensitive position as
the school’s comptroller.

ISSUE AND RULING:

1. Whether or not the petitioner Bravo’s employment was terminated for a just cause —
YES he was validly dismissed based on loss of trust and confidence. A dismissal based on willful breach
of trust or loss of trust and confidence under Article 297 of the Labor Code entails the concurrence of two (2)
conditions: that the employee whose services are to be terminated must occupy a position of trust and
confidence, and that there must be the presence of some basis for the loss of trust and confidence. Petitioner
was not an ordinary rank-and-file employee. His position of responsibility on delicate financial matters entailed
a substantial amount of trust from respondent. The entire payroll account depended on the accuracy of the
classifications made by the Comptroller. It was reasonable for the employer to trust that he had basis for his
computations especially with respect to his own compensation. The preparation of the payroll is a sensitive
matter requiring attention to detail. Not only does the payroll involve the company’s finances, it also affects
the welfare of all other employees who rely on their monthly salaries. Petitioner’s act in assigning to himself a
higher salary rate without proper authorization is a clear breach of the trust and confidence reposed in him. In
addition, there was no reason for the Comptroller’s Office to undertake the preparation of its own summary
table because this was a function that exclusively pertained to the Human Resources Department.

2. Whether or not he was deprived of procedural due process —

NO, he was not. Respondent complied with all the requirements of procedural due process in terminating
petitioner’s employment. In termination based on just causes, the employer must comply with procedural due
process by furnishing the employee a written notice containing the specific grounds or causes for dismissal.
The employer must likewise give the employee ample opportunity to be heard and defend himself or herself.
Any meaningful opportunity for the employee to present evidence and address the charges against him or her
satisfies the requirement of ample opportunity to be heard. Finally, the employer must serve a notice
informing the employee of his or her dismissal from employment. In this case, respondent furnished petitioner
a show cause memo stating the specific grounds for dismissal. The show cause memo also required petitioner
to answer the charges by submitting a written explanation. Respondent even informed petitioner that he may
avail the services of counsel. Respondent then conducted a thorough investigation. Three hearings were
conducted on separate occasions. The finding of the investigation committee were then sent to petitioner.
Lastly, petitioner was given a notice of termination containing respondent’s final decision. That petitioner was
not given the chance to comment on the selection of the members of the investigating committee does not
mean that he was deprived of due process. In addition, there is no evidence indicating that the investigating
committee was biased against petitioner. Hence, there is no merit in petitioner’s claim that he was deprived of
due process.

172. Esguerra vs. Valle Verde Country Club, Inc.

G.R. No. 173012. June 13, 2012 Brion, J.
Just cause

FACTS:
A seminar was held at the country club. Esguerra, as the Cost Control Supervisor, was tasked to oversee
the seminar held in the two function rooms the Ballroom and the Tanay Room. The Valle Verde Mngt. found
out that only the proceeds from the Tanay Room had been remitted to the accounting department. Valle
Verde conducted an investigation.
On March 6, 2000, Valle Verde sent a memorandum to Esguerra requiring her to show cause as to why
no disciplinary action should be taken against her for the non-remittance of the Ballroom sales. Esguerra
denied having committed any misappropriation. She explained that it had been her daughter (who was
assigned as a food checker) who lost the money. To settle the matter, Esguerra paid the unaccounted amount
as soon as her daughter informed her about it.
 Valle Verde found Esguerra explanation unsatisfactory and, on July 26, 2000, issued a second
memorandum terminating Esguerra employment. Esguerra filed a complaint for illegal dismissal.

ISSUE:
WON Esguerra was illegally terminated?

RULING:
NO.
Substantive aspect - There are 2 classes of positions of trust the first class consists of managerial
employees, or those vested with the power to lay down management policies; and the second class consists of
cashiers, auditors, property custodians or those who, in the normal and routine exercise of their functions,
regularly handle significant amounts of money or property. Esguerra held the position of Cost Control
Supervisor and had the duty to remit the cash sales proceeds from every transaction she was assigned to. This
is not a routine task. For this reason, Esguerra occupies a position of trust and confidence a position
enumerated in the second class of positions of trust. Any breach of the trust imposed upon her can be a valid
cause for dismissal.
Loss of confidence as a just cause for termination of employment can be invoked when an employee
holds a position of responsibility, trust and confidence. In order to constitute a just cause for dismissal, the act
complained of must be related to the performance of the duties of the dismissed employee and must show
that he or she is unfit to continue working for the employer for violation of the trust reposed in him or her.
There is no merit in the allegation that it was Esguerra daughter who should be held liable. She had no
custody of the cash sales since it was not part of her duties as a food checker. It was Esguerra responsibility to
account for the cash proceeds; in case of problems, she should have promptly reported it, regardless of who
was at fault. Esguerra failure to make the proper report reflects on her irresponsibility in the custody of cash
for which she was accountable, it was her duty to account for the sales proceeds, and she should have known
about the missing amount immediately after the event.

Procedural aspect - The Court find no irregularities in the service of notice to Esguerra. The
memorandum dated March 6, 2000 informed her of the charges, and clearly directed her to show cause, in
writing, why no disciplinary action should be imposed against her. Esguerra allegation that the notice was
insufficient since it failed to contain any intention to terminate her is incorrect.
To meet the requirements of due process in the dismissal of an employee, an employer must furnish
the worker with two written notices: (1) a written notice specifying the grounds for termination and giving to
said employee a reasonable opportunity to explain his side and (2) another written notice indicating that, upon
due consideration of all circumstances, grounds have been established to justify the employer decision to
dismiss the employee.
Contrary to Esguerra allegation, the law does not require that an intention to terminate one
employment should be included in the first notice. It is enough that employees are properly apprised of the
charges brought against them so they can properly prepare their defenses; it is only during the second notice
that the intention to terminate one employment should be explicitly stated.
There is also no basis to question the absence of a proper hearing. The existence of an actual, formal
"trial-type" hearing, although preferred, is not absolutely necessary to satisfy the employee's right to be heard.
173. PJ Lhuillier vs Camacho

G.R No. 223073 February 22, 2017 Mendoza, J.

FACTS:

Petitioner P.J. Lhuillier, Inc. (PJLI), the owner and operator of the "Cebuana Lhuillier" chain of
pawnshops, hired petitioner Feliciano Vizcarra (Vizcarra) as PJLI's Regional Manager for Northern and Central
Luzon pawnshop operations and respondent Hector Oriel Cimagala Camacho(Camacho) as Area Operations
Manager(AOM). Vizcarra received several text messages from some personnel assigned in Area 213, reporting
that Camacho brought along an unauthorized person, a non-employee, during the QTP operation.Vizcarra
issued a show cause memorandum directing Camacho to explain why no disciplinary action should be taken
against him for violating PJLI's Code of Conduct and Discipline which prohibited the bringing along of
non-employees during the QTP operations. Camacho, in his Memorandum, apologized and explained that the
violation was an oversight on his part for lack of sleep and rest. With busy official schedules on the following
day, he requested his mother's personal driver, Jose Marasigan (Marasigan) to drive him back to Pangasinan.
He admitted that Marasigan rode with him in the service vehicle during the QTP operations. During the formal
investigation on June 1, 2012, Camacho admitted that he brought along a non-employee, Marasigan, during
the QTP operations on May 15, 2012. He explained that on May 12, 2012, he went home to Manila to
celebrate Mother's Day with his family on May 13, 2012. He drove himself using the service vehicle assigned to
him and arrived in Manila at around 11:00 o'clock in the evening. As he was expecting a hectic work schedule
the following day and was feeling tired due to lack of sleep for the past few days, he asked Marasigan to drive
him back to Pangasinan so he could catch some sleep on the way. Marasigan was supposed to return to Manila
on May 15, 2012, but because he was scheduled to go back to Manila on May 18, 2012, to attend a regional
conference in Antipolo, he asked the former to remain in Pangasinan so that they could travel back together to
Manila on May 17, 2012. On the day of the QTP operations, Marasigan drove the service vehicle from his
apartment to the Area Office. Upon reaching the Area Office, the Area Driver took over while Marasigan sat in
the backseat of the vehicle. Camacho admitted that he knew that it was prohibited to bring unauthorized
personnel, especially a non-employee, during the QTP operations because this was discussed in the seminars
facilitated by the company's Security Service Division. He only realized his mistake at the end of their
13-branch stop when he noticed that his companions were unusually quiet throughout the trip. It was also
discovered that Camacho committed another violation of company policy when he allowed an unauthorized
person to drive a company vehicle. Camacho was dismissed. The LA and NLRC sustained the dismissal. the
CAreversed the NLRC resolutions. It held that contrary to the findings of the LA and the NLRC, the misconduct
of Camacho was not of a serious nature as to warrant a dismissal from work. At most, said the CA, he was
negligent and remiss in the exercise of his duty as an AOM. There was no evidence that would show that said
act was performed with wrongful intent. Moreover, Camacho's termination from work could not be justified on
the ground of loss of trust and confidence. For loss of trust and confidence to be a valid ground, explained the
CA, it must be based on willful breach of the trust reposed in the employee by his employer. The breach must
have been made intentionally, knowingly, and purposely without any justifiable excuse as distinguished from
an act done carelessly, thoughtlessly, heedlessly or inadvertently. In this case, the CA found that Camacho's act
of bringing along his mother's driver during the QTP operation was not willful as it was not done intentionally,
knowingly and purposely. It was committed carelessly, thoughtlessly, heedlessly or inadvertently. Even
Camacho himself admitted that it was merely a case of human error on his part, the same being prompted by
his desire to finish his work as soon as possible.

ISSUE:

WON the CA erred in ruling that the penalty of dismissal was disproportionate to the infraction
committed due to the lack of malicious intent of Camacho

RULING:

No. Article 282(c) of the Labor Code authorizes the employer to dismiss an employee for committing
fraud or for willful breach of trust reposed by the employer on the employee. For loss of trust and confidence
to be valid ground for termination, the employer must establish that: (1) the employee holds a position of trust
and confidence; and (2) the act complained against justifies the loss of trust and confidence. The law
contemplates two (2) classes of positions of trust. The first class consists of managerial employees. They are as
those who are vested with the power or prerogative to lay down management policies and to hire, transfer,
suspend, layoff, recall, discharge, assign or discipline employees or effectively recommend such managerial
actions. The second class consists of cashiers, auditors, property custodians, etc. who, in the normal and
routine exercise of their functions, regularly handle significant amounts of money or property. Camacho held a
managerial position and, therefore, enjoyed the full trust and confidence of his superiors. As a managerial
employee, he was "bound by more exacting work ethics" and should live up to this high standard of
responsibility. Camacho, as AOM, was a managerial employee. As such, he could be terminated on the ground
of loss of confidence by mere existence of a basis for believing that he had breached the trust of his
employer. Proof beyond reasonable doubt is not required.

174. Alaska vs Ponce

G.R. No. 228412 July 26, 2017 Mendoza, J.

FACTS:

Alaska Milk Corporation (AMC) hired Ernesto L. Ponce (Ponce), a licensed mechanical engineer, as
Manager for Engineering Services of its Milk Powder Plant (MPP) and Ultra High Temperature Plant (UHT).
According to Ponce, the crux of the case emanated from his investigation of the surge in AMC's overtime costs
for the years 2006 to 2008, even though the production of milk commodities did not substantially increase
throughout those years. AMC's erstwhile Chairman of the Board, Wilfredo Uytengsu, Sr. (Uytengsu, Sr.), was
alarmed about the P34.1 million overtime costs. Thus, he verbally directed Ponce to investigate the matter.
once submitted his report on the excessive overtime costs stating that the mischief behind the spiraling
overtime costs was Alaska Milk Workers Union's uncontrolled grant of personal loans to employees with
usurious interest charges. To correct the reported anomalous lending scheme perpetrated by the

Alaska Milk Workers Union (AMWU) and some of AMC's corporate managers, Ponce recommended placing a
limit on the salary deductions from the workers' wages, which would be implemented through a gradual and
prudent phase-in period of six months to one year. Uytengsu, Sr., however, did not heed Ponce's suggestion
and, instead, abruptly ordered AMC's Human Resources and Operation Management Department to stop the
automatic deduction of loan payments to AMWU. AMWU petitioned for Ponce's dismissal from employment
and threatened to stage a concerted action against AMC, to which Uytengsu, Sr. yielded.

According to AMC and Uytengsu Sr., he received a copy of an e-mail that Ponce sent to 12 of his colleagues in
connection with his "Receipted Allowance" (R/A) for business-related expenses. In the said e- mail (R/A
e-mail), Ponce solicited official receipts from his colleagues in exchange for a five percent (5%) rebate on the
value of the receipts submitted to him. Ponce was then terminated in the grounds that Ponce E-mailed his
twelve colleagues requesting for official receipts in exchange for a five percent rebate to be used in
liquidating his receipted allowance/fraudulently submitting official receipts of expenses which he did not
incur. The LA ruled that Ponce was illegally dismissed. The NLRC reversed the decision, ruling that the act of
soliciting official receipts in exchange for a 5% rebate was an act of dishonesty inimical to the interest of AMC,
as Ponce would be collecting receipted allowance from expenses which he did not actually incur. The CA
opined that Ponce's dismissal on the ground of loss of trust and confidence was a mere afterthought. It found
that the First Performance Evaluation Memorandum did not mention Ponce's acts which resulted in AMC's loss
of trust and confidence; and that there was neither any explanation nor discussion of his alleged sensitive and
delicate position requiring AMC's utmost trust and confidence.

ISSUE:

WON there is just cause to terminate Ponce’s employment

RULING:

Yes. The language of Article 297 (c) of the Labor Code states that the loss of trust and confidence must
be based on willful breach of the trust reposed in the employee by his employer. Such 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. The opening sentence of Ponce's R/A e-mail readily
exposes the attendant willfulness in his act. It reads: "Dear Neighbors and Friends, Do you want to earn extra
from your own expenses?" Going further, the body of the R/A e-mail consists of "rules" that the recipients will
have to follow in order to be entitled to a 5% cash rebate on the value of the receipts they will submit. The
"rules" were intelligibly crafted with the end view of achieving a purpose, and the inciting tenor of the opening
statement evinces premeditation. Thus, it is beyond cavil that the R/A e-mail is a product of a conscious design,
certainly not one borne out of sheer carelessness or inadvertence.

Second, the act of soliciting receipts from colleagues constitutes dishonesty, inimical to AMC's interests, for the
simple reason that Ponce would be collecting receipted allowance from expenses he did not actually incur. It
has long been settled that an employer cannot be compelled to retain an employee who is guilty of acts
inimical to his interests. This is all the more true in the case of supervisors or personnel occupying positions of
responsibility.
Third, the R/A e-mail betrays a truly sinister purpose which AMC had a right to guard against. There is
sufficient basis to dismiss Ponce on the ground of loss of trust and confidence.

175. Rowena A. Santos v Integrated Pharmaceutical Inc

G.R. No. 204620
Del Castillo, J

FACTS

● Integrated Pharma is a pharmaceutical marketing and distributing company.

● On February 26, 2005, it engaged the services of petitioner as "Clinician," tasked with the duty of
promoting and selling Integrated Pharma's products.
● Petitioner's work includes visiting doctors in different hospitals located in Makati, Taguig,
Pateros and Pasay.
● Then in the morning of April 21, 2010, respondents attempted to serve upon petitioner a
memorandum[8] denominated as Memo on Padding of Expense Report.
● It charged petitioner with
● (i) attempting to coerce her immediate supervisor to pad her transportation expenses
and
● (ii) insubordination for not following the instructions of her immediate supervisor to
report the true amount of her transportation expenses.
● Petitioner, however, refused to accept said memorandum.
● Subsequently, petitioner received through registered mail another memorandum likewise dated April
21, 2010 but already denominated as Termination of Employment. It enumerated five infractions
which, allegedly, constrained respondents to terminate petitioner's employment, viz.:

After weighing all the factors on the various infractions you have committed, to wit:

(1) Overstating transportation expenses

(2) Attempting to coerce your manager to overstate transportation

(3) Unpleasant attitude towards clients, co-workers and superiors

(4) Failure to remit collection on time

(5) Insubordination (e.g., failure to arrive at appointed meeting time, failure to submit reports
at designated hour, and, ultimately, refusal to accept the memo asking for a written
explanation on the incidents in question after verbally admitting to committing the stated
offenses) and despite considering your length of stay in the company, we have come to a
forced conclusion to terminate your employment, x x x
 ● Petitioner thus filed a complaint for illegal dismissal, nonpayment of salary, separation pay, and 13th
month pay, with claims for moral and exemplary damages and attorney's fees.
● The LA and NLRC ruled that petitioner was NOT illegally dismissed, however the CA reversed them

ISSUE: W/N ROWENA was illegally dismissed? YES

RATIO

● ON GROSS AND HABITUAL NEGLECT OF DUTY (EXCESSIVELY TARDY)

● IN CASE AT BAR, she was habitually tardy – always late in district meetings and in the submission of her
periodic reports (evaluation conducted – she was given a low mark of 1.5 as to punctuality; result
conducted 2 years later by her new supervisor did not shown any sign of improvement = still failed to
report on time both in the office and during regular field work visits)
● Memo also bears out her lack of deep sense of duty and punctuality – she was
chastised for arriving in the office late in the after noon when she was given the
specific instruction to be at the office in the morning of said date
● She was also late for about 4 1⁄2 hours for her appointment
● Her payslips also reveal several deductions from her salary due to tardiness and
absences
● Her tardiness is so excessive that it already affects the general productivity and
business of INTEGRATED PHARMA
● ON INSUBORDINATION
● IN CASE AT BAR, clear from memo that she was tasked to remit her collections to the office but when
she arrived her office in the afternoon, it made it impossible for INTEGRATED PHARMA to deposit her
collections
● Another instance of insubordination was when she did not bring the CareSens SOP
demonstration unit to the office at a particular given time – could not provide sensible
justification why she failed to arrive at the appointed time.
● She was instructed to reflect in her expense report the amount of P2.00, which is the
actual amount she incurred as transportation expense in going to the Fort Bonifacio Hospital
but she disobeyed her immediate supervisor and continued to reflect the amount of P10.00 in
her expense reports.
● ON DISHONESTY
● To state an amount of actual transportation expense other than the amount actually incurred for
transportation is dishonesty.
● Her act of deliberately misdeclaring or overstating her actual travelling expense
constitutes dishonesty and serious misconduct
● The fact that petitioner had been declaring P10.00 as her actual traveling expense for
quite some time cannot be interpreted as condonation of the offense or waiver of Integrated
Pharma to enforce its rules.
● PAST OFFENSE MAY BE TAKEN INTO CONSIDERATION IN IMPOSING THE APPROPRIATE PENALTY
 ● Had already been reprimanded for the infractions stated in the memo – undoubtedly
dealt with her failure to remit her collections and to return the CareSens POP
demonstration unit, at the appointed time
● Last paragraph even contained a warning that a repetition of the same offense in the
future may result in the imposition of stiffer penalty of suspension or even termination.
● HENCE, she could no longer be punished for said offenses. NEVERTHELESS, her failure to remit
collections and to return the CareSens POP demonstration unit on time
may still be considered in imposing the appropriate penalty for future offenses
● SHE WAS NOT ACCORDED DUE PROCESS
● They presented 2 written notices charging her with various offenses – both fall short of the
requirements of the law
● APR 6 2010 memorandum did not apprise her of an impending termination from employment (did not
require her to submit within a specific period of time her written explanation controverting the charges
against her) – did not specify the company rules violated by her or the cause of her possible dismissal)
● After elaborating on the two acts of insubordination, said memorandum merely
● reprimanded petitioner and warned her that a commission of the same or similar offense in the
future would be visited with stiffer penalty.
● INTEGRATED PHARMA never scheduled a hearing or conference

DISPOSITIVE: WHEREFORE, PETITION DENIED

176. Gaite vs. Filipino Society of Composers, Authors, and Publishers, Inc. (2018)

SUMMARY: Gaite was validly dismissed on the grounds of serious misconduct and loss of trust and confidence
for her unauthorized reallocation of funds from FILSCAP's Special Accounts to cover the deficit in its Operating
Expense without the required knowledge, consent, or authorization of the company's Board of Directors.

Facts: On May 16, 2006, FILSCAP employed Gaite as its General Manager.
In 2012, several issues pertaining to Gaite were brought to the attention of FILSCAP's Board of Trustees
which include the following: (1) the erroneous filing of a case against a records company without prior notice
to the Board, which eventually resulted in FILSCAP being ordered to pay P1,000,000.00 in damages; (2) her
non-disclosure of her receipt of an e-mail inviting one of the board members to a regional digital licensing
conference in Taipei; (3) her willful delay in taking action on the collection of proxy forms from members for
the May 28, 2011 FILSCAP elections and, consequently, collection of an insufficient number of proxy forms for
the said election; (4) her non- disclosure of the complete list of members to a board member who wanted to
help in securing the proxy forms; and (5) the appropriation for her personal benefit of show tickets given to
FILSCAP, which were supposed to be used for monitoring purposes.
During said investigation, FILSCAP confirmed Gaite's unauthorized misappropriation or reallocation,
which she committed together with the then Distribution Manager, Mr. Genor Kasiguran, amounting to
P17,720,455.77. In fact, she even admitted the same in her email to Board member, Mr. Gary Granada, on June
22, 2012.
In view of said discovery, FILSCAP issued a Show Cause Notice to Gaite dated July 10, 2012 requiring her
to explain why no disciplinary sanctions should be imposed on her and likewise placed her under preventive
suspension with pay, pending the administrative investigation. In her reply, Gaite denied any misappropriation
and informed the Board that she had already filed a case for constructive dismissal against FILSCAP on June 28,
2012, or two (2) days after the cancelled signing of the Quitclaim and even before the July 10, 2012
show-cause notice was sent to her.
LA ruled for Gaite. NLRC affirmed. CA reversed.

ISSUES:
● WoN Gaite was legally dismissed

RULING:
● YES. In the instant case, the Court finds that Gaite's actuations constitutes serious misconduct. First,
the seriousness of the same cannot be denied. Not only is the amount involved herein a staggering
amount of P17,720,455.77, the alleged reallocation violated an express provision of the company's
Distribution Rules and was accomplished without the knowledge, consent, or authorization of the
Board. Second, Gaite committed said transfer in the performance of her duties as General Manager of
FILSCAP who is responsible for the overall operations thereof, including the regular review and
updating of its distribution guidelines to facilitate royalty distribution to FILSCAP members and foreign
affiliates. Third, because of this grave infraction causing the depletion of the company's Special
Accounts held in trust for the rightful copyright owners, Gaite's ability to duly perform and accomplish
her duties and responsibilities as General Manager has been seriously put into question. It is clear,
therefore, that Gaite's acts amounted to serious misconduct warranting her dismissal.

177. SAMASAH-NUWHRAIN VS. Hon. Voluntary Arbiter BUENAVENTURA & HOTEL ENTERPRISES
G.R. No. 164939 : June 06, 2011; VILLARAMA, JR., J.:
LABOR LAW: Willful disobedience, serious misconduct, dismissal

Facts:
Petitioner Samahan ng mga Manggagawa sa Hyatt-NUWHRAIN-APL is a duly registered union and the
certified bargaining representative of the rank-and-file employees of Hyatt Regency Manila, operated by
respondent Hotel Enterprises of the Philippines, Inc.

Hyatt's General Manager, issued a Memorandum informing all hotel employees that hotel security have been
instructed to conduct a thorough bag inspection and body frisking in every entrance and exit of the hotel. He
enjoined employees to comply therewith. Angelito Caragdag, a waiter at the hotel's Cafe Al Fresco restaurant
and a director of the union, refused to be frisked by the security personnel. The Human Resources Department
(HRD), issued a Memorandum to Caragdag requiring him to explain in writing within forty-eight (48) hours
from notice why no disciplinary action should be taken against him. The following day, Caragdag again refused
to be frisked by the security personnel. Thus, the HRD issued another Memorandum requiring him to explain.
The HRD imposed on Caragdag the penalty of reprimand for the incident, which was considered a first offense,
and suspended him for three days for the February 6, 2001 incident, which was considered as a second
offense. Both penalties were in accordance with the hotel's Code of Discipline. Subsequently, when Mike
Moral, the manager of Hyatt's Cafe Al Fresco and Caragdag's immediate superior, was about to counsel two
staff members at the training room, Caragdag suddenly opened the door and yelled at the two with an
enraged look. In a disturbing voice he said, "Ang titigas talaga ng ulo n'yo. Sinabi ko na sa inyo na huwag
kayong makikipagusap sa management habang ongoing pa ang kaso!" Moral asked Caragdag what the problem
was and informed him that he was simply talking to his staff. Moral also told Caragdag that he did not have the
right to interrupt and intimidate him during his counseling session with his staff. In a Memorandum, Moral
held Caragdag liable for "threatening, intimidating, coercing, and provoking to a fight your superior for reasons
directly connected with his discharge of official duty”, under Offenses Subject to Disciplinary Action (OSDA) of
the hotel's Code of Discipline, and was imposed the penalty of seven days suspension. Later, Caragdag
committed another infraction by leaving his work assignment during official hours without prior permission
from his Department Head. Moral found Caragdag liable for violating provisions of the OSDA, specifically for
"leaving work assignment during official working hours without prior permission from the department head or
immediate superior," and suspended him for three days. On June 1, 2001, the hotel, through Atty. Juancho A.
Baltazar, sent Caragdag a Notice of Dismissal.

Caragdag's dismissal was questioned by petitioner, and the dispute was referred to voluntary arbitration upon
agreement of the parties. The Voluntary Arbitrator rendered a decision and ruled that the three separate
suspensions of Mr. Caragdag are valid, his dismissal is legal and OSDA 4.32 of Hyatt's Code of Discipline is
reasonable. In finding the three separate suspensions of Caragdag valid, the Voluntary Arbitrator reasoned that
the union officers and members had no right to breach company rules and regulations on security and
employee discipline on the basis of certain suspicions against management and an ongoing CBA negotiation
standoff. The Voluntary Arbitrator also found that when Caragdag advised Lacambacal and Alvaro not to give
any statement, he threatened and intimidated his superior while the latter was performing his duties.
Moreover, there is no reason why he did not arrange his time-off with the Department Head concerned. Thus,
Caragdag was validly dismissed pursuant to OSDA 4.32 of Hyatt’s Code of Discipline, which states that an
employee who commits three different acts of misconduct within a twelve (12)-month period commits serious
misconduct. The VA however awarded 100,000 financial assistance for humanitarian considerations.
Petitioner’s motion for reconsideration was dismissed hence the appeal with the CA. The CA upheld the AV
ruling, but removed the award for financial assistance.

Petitioner argues that while it is true that the award of financial assistance is given only for dismissals due to
causes specified under Articles 283 and 284 of the Labor Code, as amended, this Court has, by way of
exception, allowed the grant of financial assistance to an employee dismissed for just causes based on equity.

Respondent on the other hand, asserts that the CA correctly deleted the award of financial assistance
erroneously granted to Caragdag considering that he was found guilty of serious misconduct and other acts
adversely reflecting on his moral character. Respondent stresses that Caragdag's willful defiance of the hotel's
security policy, disrespect and intimidation of a superior, and unjustifiable desertion of his work assignment
during working hours without permission, patently show his serious and gross misconduct as well as amoral
character.
Issue:

1. Whether Caragdag was validly dismissed.

2. Whether Cargdag is entitled to financial assistance.

Ruling:

1. Yes. In Piedad v. Lanao del Norte Electric Cooperative, Inc., (153 SCRA 500; 1987), we ruled that a series
of irregularities when put together may constitute serious misconduct, which under Article 282 of the Labor
Code, as amended, is a just cause for dismissal.

2. No. The grant of separation pay or some other financial assistance to an employee dismissed for just
causes is based on equity. In Phil. Long Distance Telephone Co.v. NLRC, we ruled that severance
compensation, or whatever name it is called, on the ground of social justice shall be allowed only when the
cause of the dismissal is other than serious misconduct or for causes which reflect adversely on the
employee's moral character. Here, Caragdag's dismissal was due to several instances of willful disobedience
to the reasonable rules and regulations prescribed by his employer. The Voluntary Arbitrator pointed out that
according to the hotel's Code of Discipline, an employee who commits three different acts of misconduct
within a twelve (12)-month period commits serious misconduct. He stressed that Caragdag's infractions were
not even spread in a period of twelve (12) months, but rather in a period of a little over a month. Records
show the various violations of the hotel's rules and regulations were committed by Caragdag. He was
suspended for violating the hotel policy on bag inspection and body frisking. He was likewise suspended for
threatening and intimidating a superior while the latter was counseling his staff. He was again suspended for
leaving his work assignment without permission. Evidently, Caragdag's acts constitute serious misconduct.

Essentially, Caragdag's dismissal being due to serious misconduct, it follows that he should not be entitled to
financial assistance. To rule otherwise would be to reward him for the grave misconduct he committed. We
must emphasize that social justice is extended only to those who deserve its compassion.

178. Lopez v. Alturas Group of Companies

April 11, 2011

Facts:
Quirico Lopez (petitioner) was hired by respondent Alturas Group of Companies in 1997 as truck driver.
Ten years later, he was dismissed after he was allegedly caught by respondent’s security guard in the act of
attempting to smuggle out of the company premises 60 kilos of scrap iron worth P840 aboard respondents’
Isuzu Cargo Aluminum Van that was then assigned to him. When questioned, petitioner allegedly admitted to
the security guard that he was taking out the scrap iron consisting of lift springs out of
Which he would make axes.

In his compliance with the Show Cause Notice, the petitioner submitted his handwritten explanation
and denied the allegations. However, the respondent company found his explanation unsatisfactory and
terminated his employment on the grounds of loss of trust and confidence, and of violation of company rules
and regulations. As a result of the respondent company’s investigation, they found out that the petitioner had
been smuggling out its cartons which he had sold for his own benefit. Thus, a criminal case
for qualified theft was filed against him.

Petitioner thereupon filed a complaint against respondent company for illegal dismissal and underpayment of
wages. He claimed that the smuggling charge against him was fabricated to justify his illegal dismissal and that
the filing of the charge came about after he reported the loss of the original copy of his pay slip, which report,
he went on to claim, respondent company took to mean that he could use the pay slip as evidence for filing a
complaint for violation of labor laws; and that on account of the immediately stated concern of respondent, it
forced him into executing an affidavit that if the pay slip is eventually found, it
could not be used in any proceedings between them.

The LA, holding that the pendency of the criminal case involving the scrap iron did not warrant the suspension
of the proceedings before him, held that petitioner’s dismissal was justified, for he, a truck driver, held a
position of trust and confidence, and his act of stealing company property was a violation of the trust reposed
upon him. The NLRC set aside the decision of the LA finding that respondent’s evidence did not suffice to
warrant the termination of petitioner’s services; and that petitioner’s alleged admission of taking the scrap
iron was belied by his vehement denial, as even the security guard, one Gerardo Luega, who allegedly
witnessed the asportation and before whom the alleged admission was made, did not even execute an
affidavit in support thereof. He as also not advised of his right to counsel.

However, the CA reversed the NLRC ruling. But although it found that petitioner’s dismissal was for a just
cause, it held that due process was not observed when respondent company failed to give him a chance to
defend his side in a proper hearing. Following Agabon v. NLRC, the appellate court thus ordered respondent to
pay nominal damages of P30,000.

Issue: Whether the petitioner was illegally dismissed.

Ruling: No. Dismissals have two facets: the legality of the act of dismissal, which constitutes substantive due
process, and the legality of the manner of dismissal which constitutes procedural due process.
As to substantive due process, the Court finds that respondent company’s loss of trust and confidence arising
from petitioner’s smuggling out of the scrap iron, compounded by his past acts of unauthorized selling cartons
belonging to respondent company, constituted just cause for terminating his services. The allegations were
amply proven by substantial evidence consisting of the affidavits of various employees of respondent.

Loss of trust and confidence as a ground for dismissal of employees covers employees occupying a position of
trust who are proven to have breached the trust and confidence reposed on them. Apropos is Cruz v. Court of
Appeals13 which explains the basis and quantum of evidence of loss of trust and confidence, viz.:

“In addition, the language of Article 282(c) of the Labor Code states that the loss of trust and confidence must
be based on willful breach of the trust reposed in the employee by his employer. Such 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. Moreover, it must be based on substantial evidence and
not on the employer’s whims or caprices or suspicions otherwise, the employee would eternally remain at the
mercy of the employer. 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. 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 working for the employer. In addition, 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, trust and
confidence or that the employee concerned is entrusted with confidence with respect to delicate matters, such
as the handling or care and protection of the property and assets of the employer. The betrayal of this trust is
the essence of the offense for which an employee is penalized.”

Petitioner, a driver assigned with a specific vehicle, was entrusted with the transportation of respondent
company’s goods and property, and consequently with its handling and protection, hence, even if he did not
occupy a managerial position, he can be said to be holding a position of responsibility. As to his act–principal
ground for his dismissal — his attempt to smuggle out the scrap iron belonging to respondent company, the
same is undoubtedly work-related.

As to procedural due process, it has been defined as giving an opportunity to be heard before judgment is
rendered. In the case at hand, the Court finds that the petitioner was given the opportunity to explain his side
when he was informed of the charge against him and required to submit his written explanation with
which he complied. That there might have been no hearing is of no moment.

In addition to that, the Court finds that it was error for the NLRC to opine that petitioner should have been
afforded counsel or advised of the right to counsel. The right to counsel and the assistance of one in
investigations involving termination cases is neither indispensable nor mandatory, except when the employee
himself requests for one or that he manifests that he wants a formal hearing on the charges against him. In
petitioner’s case, there is no showing that he requested for a formal hearing to be conducted or that he be
assisted by counsel. Verily, since he was furnished a second notice informing him of his dismissal and the
grounds therefor, the twin-notice requirement had been complied with to call for a deletion
of the appellate court’s award of nominal damages to petitioner. Therefore, the petition is denied. The Report
of the CA is affirmed with modification in that the award of nominal damages in the amount of P30,000 is
deleted.

179. Puncia vs Toyota

G.R no. 214399
JUST CAUSES

Main Point: TERMINATION BY EMPLOYER For a dismissal to be valid, the employer must comply with both
substantive and procedural due process requirements. The dismissal must be pursuant to a just or authorized
cause under the Labor Code and the employer must observe the twin requirements of notice and hearing. 

Facts:
Puncia alleged that since 2004, he worked as a messenger/collector for Toyota and was later on appointed on
March 2, 2011 as a Marketing Professional7 tasked to sell seven (7) vehicles as monthly quota. However, Puncia
failed to comply and sold only one (1) vehicle for the month of July and none for August, prompting Toyota to
send him a Notice to Explain. In reply,  Puncia stated that as a trainee, he was only required to sell three (3)
vehicles per month; that the month of May has always been a lean month; and that he was able to sell four (4)
vehicles in the month of September. Thereafter, a hearing was conducted but Puncia failed to appear despite
notice.

On October 18, 2011, Toyota sent Puncia a Notice of Termination, dismissing him on the ground of
insubordination for his failure to attend the scheduled hearing and justify his absence. This prompted Puncia to
file a complaint for illegal dismissal with prayer for reinstatement and payment of backwages, unfair labor
practice, damages, and attorney's fees against Toyota and its officers, claiming, inter alia, that Toyota dismissed
him after discovering that he was a director of the Toyota-Shaw Pasig Workers Union-Automotive Industry
Worker's Alliance; and that he was terminated on the ground of insubordination and not due to his failure to
meet his quota as contained in the Notice to Explain.

In its defense, Toyota denied the harassment charges and claimed that there was a valid cause to dismiss
Puncia, considering his failure to comply with the company's strict requirements on sales quota. It likewise
stated that Puncia has consistently violated the company rules on attendance and timekeeping as several
disciplinary actions were already issued against him.

Issue: whether or not Puncia was dismissed from employment for just cause

Ruling: Yes, as to the question the petitioners failure to reach his monthly sales quota - for such a period of
time falls under the concept of gross inefficiency. In this regard, case law instructs that "gross inefficiency" is
analogous to "gross neglect of duty," a just cause of dismissal under Article 297 of the Labor Code, 

The petitioners' failure to meet the sales quota assigned to each of them constitute a just cause of their
dismissal, regardless of the permanent or probationary status of their employment. Failure to observe
prescribed standards of work, or to fulfill reasonable work assignments due to inefficiency may constitute
just cause for dismissal. Such inefficiency is understood to mean failure to attain work goals or work quotas,
either by failing to complete the same within the allotted reasonable period, or by producing unsatisfactory
results.

HOWEVER, a closer look at the records reveals that in the Notice to Explain, Puncia was being made to explain
why no disciplinary action should be imposed upon him for repeatedly failing to reach his monthly sales quota,
which act, as already adverted to earlier, constitutes gross inefficiency. On the other hand, a reading of the
Notice of Termination shows that Puncia was dismissed not for the ground stated in the Notice to Explain, but
for gross insubordination on account of his non-appearance in the scheduled October 17, 2011 hearing
without justifiable reason. In other words, while Toyota afforded Puncia the opportunity to refute the charge
of gross inefficiency against him, the latter was completely deprived of the same when he was dismissed for
gross insubordination - a completely different ground from what was stated in the Notice to Explain. As such,
Puncia's right to procedural due process was violated.
Hence, considering that Toyota had dismissed Puncia for a just cause, albeit failed to comply with the proper
procedural requirements, the former should pay the latter nominal damages in the amount of P30,000.00 in
accordance with recent jurisprudence.

180. Interadent Zahntechnik Phil. v. Simbillo

Gr. NO 207315
JUST CAUSE

MAIN POINT: It bears emphasizing that the right of an employer to dismiss its employees on the ground of loss
of trust and confidence must not be exercised arbitrarily, For loss of trust and confidence to be a valid ground
for dismissal, it must be substantial and founded on clearly established facts. Loss of confidence must not be
used as a subterfuge for causes which are improper, illegal or unjustified; it must be genuine, not a mere
afterthought, to justify earlier action taken in bad faith. Because of its subjective nature, this Court has been
very scrutinizing in cases of dismissal based on loss of trust and confidence because the same can easily be
concocted by an abusive employer.

FACTS: Rebecca F. Simbillo worked at Interadent Zahntechnik Philippines, Inc. as a rank-and-file employee, and
was promoted to the position of Finance and Accounting Manager. A companywide implementation of
different security measures, such as body frisking and bag/personal items inspection, disconnection of all USB
ports, and prohibition of cellular phone usage was sought by Interadent brought about by an alleged leakage
of security information. Because of such implementation, all network and internet connections in Interadent’s
Accounting Department were removed and disabled, which included suspension of Simbillo’s electronic mail
(email) account. A Memorandum (Notice to Explain) was served to Simbillo with regard to a message she
posted on her Facebook account “referring to company concerns with the BIR and insulting statements against
a co-worker.” In said Memorandum, she was reminded that as Finance and Accounting Manager, she should
observe the highest degree of confidentiality in handling sensitive information. She was then preventively
suspended for seven days. The following day, Simbillo wrote a reply arguing that she was already constructively
dismissed prior receipt of the Memorandum because of the discriminatory acts committed by petitioners
through certain security procedures directed exclusively and solely against her. Simbillo further claimed that
the Memorandum was defective and was only used to disguise the intent to dismiss her; and that she
committed no violation of any rule or law relative to the message she posted on Facebook. Upon failure to
submit a written explanation and attend the hearing, Simbillo’s suspension was extended; which caused
Simbillo to reiterated her claim. A Complaint for constructive illegal dismissal, non-payment of service
incentive leave pay, 13th month pay, illegal suspension, claims for moral and exemplary damages and
attorney’s fees was filed by Simbillo against petitioners to the Labor Arbiter. Days after, petitioners issued a
Second Notice informing Simbillo of her termination from service on the ground of loss of trust and
confidence, for disclosing sensitive and confidential information when she made a post on her Facebook
account.

ISSUE: Whether or not Rebecca Simbillo was validly dismissed from employment
RULING: NO, Simbillo was illegally dismissed form employment since the allegation of loss of trust and
confidence was not supported by substantial evidence, thus making the dismissal unjustified. As a managerial
employee, the existence of a basis for believing that Simbillo has breached the trust of petitioner justifies her
dismissal. However, to be a valid ground, loss of trust and confidence must be based on willful breach of trust –
done intentionally, knowingly and purposely, without justifiable excuse, as distinguished from an act done
carelessly, thoughtlessly, heedlessly, or inadvertently. In this case, the act alleged made by Simbillo – the
posting of the Facebook entry did not contain any corporate record or any confidential information.
Otherwise stated, there was really no actual leakage of information; and that no company information or
corporate record was divulged. If at all, Simbillo can only be said to have acted “carelessly, thoughtlessly,
heedlessly or inadvertently” in making such comment on Facebook; however, such would not amount to loss
of trust and confidence as to justify the termination of her employment. When the breach of trust or loss of
confidence conjectured upon is not borne by clearly established facts, as in this case, such dismissal on the
ground of loss of trust and confidence cannot be upheld.

181. CEBU PEOPLE'S MULTI-PURPOSE COOPERATIVE vs. NICERATO E. CARBONILLA, JR.,

G.R. No. 212070

Facts:

● CPMPC hired Carbonilla as a Credit and Collection Manager and, was tasked with the handling of the
credit and collection activities of the cooperative, which included recommending loan approvals,
formulating and implementing credit and collection policies, and conducting trainings.
● CPMPC underwent a reorganization whereby Carbonilla was also assigned to perform the duties of
Human Resources Department (HRD) Manager, i.e., assisting in the personnel hiring, firing, and
handling of labor disputes.
● A year later, he was appointed as Legal Officer and subsequently, held the position of Legal and
Collection Manager.
● Later on, CPMPC, through its HRD Manager, Ma. Theresa R. Marquez, sent various memoranda to
Carbonilla seeking explanation on the various infractions he allegedly committed.
● Unconvinced by Carbonilla explanations, CPMPC scheduled several clarificatory hearings, but the
former failed to attend despite due notice.
● CPMPC conducted a formal investigation where it ultimately found Carbonilla to have committed acts
prejudicial to CPMPC's interests. As such, CPMPC, CEO Quevedo, sent Carbonilla a Notice of Dismissal,
informing the latter of his termination on the grounds of:
o a)  Loss of trust and confidence;
o b)  Gross disrespect;
o c)  Serious misconduct;
o d)  Gross negligence;
o e)  Commission of a crime of falsification/inducing Aguipo to violate the law or the Land
Transportation and Traffic Code; and
o f)  Committing acts highly prejudicial to the interest of the cooperative.
● Consequently, Carbonilla filed the instant case for illegal dismissal, non-payment of salaries, 13th
month pay, as well as damages and backawages, against
 o CPMPC, before the NLRC.
● In defense, CPMPC maintained that the totality of Carbonilla infractions was
o sufficient to warrant his dismissal, and that it had complied with the procedural due process
in terminating him. CPMPC pointed out that Carbonilla, Jr. had been fully paid of all his
benefits, notwithstanding his unsettled obligations to it in the form of loans, insurance policy
premiums, and cash advances, among others, amounting to a total of P129, 455.00.

LA: dismissed complaint for lack of merit. It found that Carbonilla committed a litany of infractions, the totality
of which constituted just cause for the termination. It was determined that CPMPC afforded Carbonilla
procedural due process prior to his termination evinced by the memoranda’s. Carbonilla’s claims for unpaid
salaries and 13th month pay, as records show that the aggregate amount of his monetary claims is not even
enough to pay his accountabilities to CPMPC in the total amount of P129, 455.00.

NLRC: affirmed the LA ruling. CPMPC have substantially proven the existence of just causes in dismissing
Carbonilla. It further held that Carbonilla was given the opportunity to present his side and to disprove the
charges against him, but failed to do so. Finally, the NLRC explained that while Carbonilla may indeed be
entitled to his claims for unpaid salaries and 13th month pay, the same cannot be granted as his
accountabilities with CPMPC were larger than said claims.

CA: reversed and set aside the NLRC, ordered Carbonilla reinstated and the remand of the case to the LA for
the computation of his full backwages, inclusive of allowances and other benefits, as well as attorney's fees. It
held that the NLRC gravely abused its discretion in declaring Carbonilla’s dismissal as valid, considering that,
other than CPMPC's series of memoranda and self-serving allegations, it did not present substantial
documents to support a conclusion that would warrant Carbonilla’s valid dismissal.

Issues:
TH
1. Whether Carbonilla is entitled to the unpaid salaries and 13 month pay – NO.

2. Whether Carbonilla was validly terminated – YES.

Ruling:

1. No. The Court notes that Carbonilla’s award of unpaid salaries and 13th month pay were validly offset by his
accountabilities to CPMPC in the amount of P129,455.00.

Pursuant to Article 1278 in relation to Article 1706 of the Civil Code and Article 113 (c) of the Labor Code,
compensation can take place between two persons who are creditors and debtors of each other.
Considering that Carbonilla, Jr. had existing debts to CPMPC which were incurred during the existence of the
employer-employee relationship, the amount which may be due him in wages was correctly deducted
therefrom.

2. Yes. Basic is the rule that an employer may validly terminate the services of an employee for any of the just
causes enumerated under Article 296 (formerly Article 282) of the Labor Code.
As may be gathered from the tenor of CPMPC's Notice of Dismissal, it is apparent that Carbonilla, Jr.'s
employment was terminated on the grounds of, among others, serious misconduct and loss of trust and
confidence

As to serious misconduct

Carbonilla’s serious misconduct consisted of him frequently exhibiting disrespectful and belligerent behavior,
not only to his colleagues, but also to his superiors. He even used his stature as a law graduate to insist that he
is "above" them, often using misguided legalese to weasel his way out of the charges against him, as well as to
strong-arm his colleagues and superiors into succumbing to his arrogance. This is evidenced by the following
infractions:

(a) his reply to a memoranda wherein he threatened HRD Manager Marquez with a lawsuit; (b) where he
berated COO Bentillo in front of her subordinates with the statement:"[i]kaw ra may di mosalig ba, ka
kwalipikado adto niya, maski mag contest pa mo, lupigon gani ka" or "[y ]ou're the only one who doesn't trust
her, she is very qualified, you even lose in comparison to her[,]” and his reply thereto wherein he dismissed the
charge as made with malicious intent and aimed to discredit his person; (c) he argued with the CEO Quevedo,
insisting that he had the authority to hire a new staff, and his reply thereto where he cited the Philippine Law
Dictionary to maintain that his act did not amount to insubordination; (d) he openly questioned the authority
of HRD Manager Marquez in refusing to hire a new staff and his reply thereto where he again cited the
Philippine Law Dictionary to insist that he did not commit acts of insubordination; and (e) he openly and
improperly confronted the CPMPC CEO during a Board of Directors' inquiry hearing, to which he again
maintained that his acts did not constitute misconduct, gross disrespect, and loss of trust and confidence as he
was only looking after the welfare of the cooperative.

Lastly, the misconduct was performed with wrongful intent as no justifiable reason was presented to excuse
the same. On the contrary, Carbonilla comes off as a smart aleck who would even go to the extent of dangling
whatever knowledge he had of the law against his employer in a combative manner. As succinctly put by
CPMPC, "[e]very time [Carbonilla, Jr.'s] attention was called for some inappropriate actions, he would always
show his Book, Philippine Law Dictionary and would ask the CEO or HRD Manager under what provision of the
law he would be liable for the complained action or omission.”

With all these factored in, CPMPC's dismissal of Carbonilla, Jr. on the ground of serious misconduct was amply
warranted.

As to loss of trust

For another, Carbonilla's dismissal was also justified on the ground of loss of trust and confidence.
There are two (2) classes of positions of trust: first, managerial employees whose primary duty consists of the
management of the establishment in which they are employed; and second, fiduciary rank-and-file employees,
such as cashiers, auditors, property custodians, who regularly handle significant amounts of money or
property. These employees, though rank-and-file, are routinely charged with the care and custody of the
employer's money or property, and are thus classified as occupying positions of trust and confidence.
Records reveal that Carbonilla, Jr. occupied a position of trust and confidence as he was employed as Credit
and Collection Manager, and later on, as Legal and Collection Manager, tasked with the duties of, among
others, handling the credit and collection activities of the cooperative, which included recommending loan
approvals, formulating and implementing credit and collection policies, and conducting trainings. With such
responsibilities, it is fairly evident that Carbonilla, Jr. is a managerial employee within the ambit of the first
classification of employees. The loss of CPMPC's trust and confidence in Carbonilla, Jr., as imbued in that
position, was later justified in light of the latter's commission of the following acts: (a) the forwarding of

the mediation settlements for notarization to a lawyer who was not the authorized legal retainer; (b) the
pull-out of important records and vital documents from the office premises, which were either lost or returned
already tampered and altered; and (c) the incurring of unliquidated cash advances related to the notarial
transactions of the mediation agreements.

Thus, the totality and gravity of Carbonilla’s infractions throughout the course of his employment completely
justified CPMPC's decision to finally terminate his employment.