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    Smart Communication vs. Astorga

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    Bert Nazario
    SMART launched an organizational realignment in 1998 that resulted in outsourcing its marketing and sales functions to a joint venture with NTT called SMART-NTT Multimedia (SNMI). As part of this, Astorga's division (CSMG/FSD) was abolished. Astorga received low performance ratings and was not recommended to SNMI, instead being offered a lower position she refused. Despite the division's abolition, Astorga continued reporting until being notified of redundancy termination effective April 1998. Astorga filed a complaint for illegal dismissal which was rejected as the court found SMART's realignment was a legitimate exercise of management prerogative to make operations more efficient.

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    Smart Communication vs. Astorga

    Uploaded by

    Bert Nazario
    118 views1 page
    SMART launched an organizational realignment in 1998 that resulted in outsourcing its marketing and sales functions to a joint venture with NTT called SMART-NTT Multimedia (SNMI). As part of this, Astorga's division (CSMG/FSD) was abolished. Astorga received low performance ratings and was not recommended to SNMI, instead being offered a lower position she refused. Despite the division's abolition, Astorga continued reporting until being notified of redundancy termination effective April 1998. Astorga filed a complaint for illegal dismissal which was rejected as the court found SMART's realignment was a legitimate exercise of management prerogative to make operations more efficient.

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    31. Smart Communication vs. Astorga

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    SMART launched an organizational realignment in 1998 that resulted in outsourcing its marketing and sales functions to a joint venture with NTT called SMART-NTT Multimedia (SNMI). As part of this, Astorga's division (CSMG/FSD) was abolished. Astorga received low performance ratings and was not recommended to SNMI, instead being offered a lower position she refused. Despite the division's abolition, Astorga continued reporting until being notified of redundancy termination effective April 1998. Astorga filed a complaint for illegal dismissal which was rejected as the court found SMART's realignment was a legitimate exercise of management prerogative to make operations more efficient.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    118 views1 page

    Smart Communication vs. Astorga

    Uploaded by

    Bert Nazario
    SMART launched an organizational realignment in 1998 that resulted in outsourcing its marketing and sales functions to a joint venture with NTT called SMART-NTT Multimedia (SNMI). As part of this, Astorga's division (CSMG/FSD) was abolished. Astorga received low performance ratings and was not recommended to SNMI, instead being offered a lower position she refused. Despite the division's abolition, Astorga continued reporting until being notified of redundancy termination effective April 1998. Astorga filed a complaint for illegal dismissal which was rejected as the court found SMART's realignment was a legitimate exercise of management prerogative to make operations more efficient.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    31. Smart Communications vs.

    Astorga
    Facts:
    SMART launched an organizational realignment to achieve more efficient operations. This was made known to
    the employees on February 27, 1998.6 Part of the reorganization was the outsourcing of the marketing and
    sales force. Thus, SMART entered into a joint venture agreement with NTT of Japan, and formed SMART-NTT
    Multimedia, Incorporated (SNMI). Since SNMI was formed to do the sales and marketing work, SMART
    abolished the CSMG/FSD, Astorga’s division.
    To soften the blow of the realignment, SNMI agreed to absorb the CSMG personnel who would be
    recommended by SMART. SMART then conducted a performance evaluation of CSMG personnel and those
    who garnered the highest ratings were favorably recommended to SNMI. Astorga landed last in the
    performance evaluation, thus, she was not recommended by SMART. SMART, nonetheless, offered her a
    supervisory position in the Customer Care Department, but she refused the offer because the position carried
    lower salary rank and rate.
    Despite the abolition of the CSMG/FSD, Astorga continued reporting for work. But on March 3, 1998, SMART
    issued a memorandum advising Astorga of the termination of her employment on ground of redundancy,
    effective April 3, 1998. Astorga received it on March 16, 1998.7
    The termination of her employment prompted Astorga to file a Complaint8 for illegal dismissal, non-payment
    of salaries and other benefits with prayer for moral and exemplary damages against SMART. She also posited
    that it was illegal for an employer, like SMART, to contract out services which will displace the employees,
    especially if the contractor is an in-house agency.
    Issue: Whether or not Astorga’s dismissal is valid
    Ruling:
    Yes. The organizational realignment introduced by SMART, which culminated in the abolition of CSMG/FSD
    and termination of Astorga’s employment was an honest effort to make SMART’s sales and marketing
    departments more efficient and competitive.
    A careful and assiduous review of the records will yield no other conclusion than that the reorganization
    undertaken by SMART is for no purpose other than its declared objective – as a labor and cost savings device.
    Indeed, this Court finds no fault in SMART’s decision to outsource the corporate sales market to SNMI in order
    to attain greater productivity. . SMART, ensure it can respond quickly, efficiently and flexibly to its customer’s
    requirement, abolished CSMG/FSD and shortly thereafter assigned its functions to newly-created SNMI
    Multimedia Incorporated, a joint venture company of SMART and NTT of Japan, for the reason that CSMG/FSD
    does not have the necessary technical expertise required for the value added services. By transferring the
    duties of CSMG/FSD to SNMI, SMART has created a more competent and specialized organization to perform
    the work required for corporate accounts. It is also relieved SMART of all administrative costs – management,
    time and money-needed in maintaining the CSMG/FSD. The determination to outsource the duties of the
    CSMG/FSD to SNMI was, to Our mind, a sound business judgment based on relevant criteria and is therefore a
    legitimate exercise of management prerogative.

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