Hubilla, et. al., vs. HSY Marketing, LTD., Co., et. al., GR No.

207354,January 10, 2018 (equipoise rule)

HSY Marketing Ltd., Co.and others are engaged in manufacturing and selling goods under the brand Novo Jeans &
Shirt & General Merchandise (Novo Jeans). The employees claimed that they were illegally dismissed. The case
was referred to the DOLE for amicable settlement, but no settlement was reached. So Petitioner Hubilla filed a
complaint for illegal dismissal against respondent HSY Marketing Ltd.

Petitioners allege that they were illegally dismissed from service when they were prevented from entering their
work premises a day after airing their grievance in a radio show. On the other hand, respondents deny this
allegation and state that petitioners were never dismissed from employment.

LA dismissed the complaint for lack of merit.

NLRC: reversed; employees were illegally dismissed.

SC: reversed NLRC reinstating the Labor Arbiter Decision.

ISSUE: whether or not petitioners were illegally dismissed by respondents. And whether or not, the doubt
should be resolved in favor of labor? Yes

First, no evidence has been presented proving that each and every petitioner received a copy of the First
Notice of Termination of Employment. There are no receiving copies or acknowledgement receipts. What
respondents presented were "Sample Letters of Respondents" and not the actual Notices that were allegedly
sent out.

Likewise, Respondents have not presented any proof that petitioners intended to abandon their employment.
They merely alleged that petitioners have already voluntarily terminated their employment due to their
continued refusal to report for work. However, this is insufficient to prove abandonment. There must be intent.

Where both parties in a labor case have not presented substantial evidence to prove their allegations, the
evidence is considered to be in equipoise. In such a case, the scales of justice are tilted in favor of labor. Thus,
petitioners are considered to have been illegally dismissed.

When the evidence of the employer and the employee are in equipoise, doubts are resolved in favor of
labor. This is in line with the policy of the State to afford greater protection to labor. In illegal dismissal cases,
the burden of proof is on the employer to prove that the employee was dismissed for a valid cause and that the
employee was afforded due process prior to the dismissal.

When laborers air out their grievances regarding their employment in a public forum, they do so in the
exercise of their right to free expression. They are "fighting for their very survival, utilizing only the weapons
afforded them by the Constitution-the untrammelled enjoyment of their basic human rights."85 Freedom and
social justice afford them these rights and it is the courts' duty to uphold and protect their free exercise. Thus,
dismissing employees merely on the basis that they complained about their employer in a radio show is not
only invalid, it is unconstitutional.

ON SOCIAL JUSTICE
Security Bank Savings Corporation vs Singson, GR No. 214230, 10 February 2016

QUICK FACTS:
Charles M. Singson was an employee of herein petitioner held the position of Customer Service Operations
Head(CSOH) tasked with the safekeeping of its check books and other bank forms. He was later charged for violating
the bank's Code of Conduct when he mishandled various checkbooks under his custody. He was later dismissed. He
appealed his dismissal with the LA, who awarded him separation pay as a form of social justice to dismissed
employees for causes other than serious misconduct and those reflecting his moral characters.
NLRC and CA affirmed the said award which is now the subject of petitioner’sappeal.
ISSUE: Whether or not the CA erred in upholding the award of separation pay as a measure of social justice to
respondent despite having been validly dismissed
HELD:The CA erred in its grant of separation pay.
b) May an employee who is validly dismissed for gross and habitual neglect of duty be entitled to separation
pay as a measure of social justice? NO
c) What are the parameters in awarding separation pay to validly dismissed
employees based on social justice?

The general rule that separation pay shall be allowed as a measure of social justice apply only to employees dismissed
from causes other than serious misconduct, willful disobedience, gross and habitual neglect of duty, fraud or willful
breach of trust, commission of a crime against the employer or his family, or those reflecting on his moral character.
The non-grant of such right to separation pay is premised on the reason that an erring employee should not benefit
from their wrongful acts.The grant of separation pay to the dismissed employee maybe
both just and compassionate, particularly if he has worked for some time with the company. x x x It is not the
employee's fault if he does not have the necessary aptitude for his work but on the other hand the company cannot be
required to maintain him just the same at the expense of the efficiency of its operations.

a) What is the equitable and humanitarian principle invoked in the cited PLDT
case?
where the cause of the separation is more serious than mere inefficiency, the generosity of the law must be more
discerning. It is compassionate to give separation pay to a salesman if he is dismissed for his inability to fill his quota
but surely he does not deserve such generosity if his offense is misappropriation of the receipts of his sales.
This is no longer mere incompetence but clear dishonesty.Thus, in the PLDT case, the Court required that the grant of
separation pay as financial assistance given in light of social justice be allowed only when the dismissal:
(a) was not for serious misconduct; and
does not reflect on the moral character of the employee or would involve moral turpitude.

As the records show, respondent was the custodian of accountable bank forms in his assigned branch and as such,was
mandated to strictly comply with the monitoring procedure and disposition thereof as a security measure to avoid the
attendant high risk to the bank. Indeed, it is true that the failure to observe the processes and risk preventive measures
and worse, to take action and address its violation,may subject the bank to regulatory sanction. It bears stressing that
the banking industry is imbued with public interest.Banks are required to possess not only ordinary diligence in the
conduct of its business but extraordinary diligence in the care of its accounts and the interests of its stakeholders It is
undisputed that respondent failed to perform his duties diligently, and therefore, not only violated established
company policy but also put the bank's credibility and business at risk. The infractions, while not clearly indicative of
any wrongful intent, is, nonetheless, serious in nature when one considers the employee's functions, rendering it
inequitable to award separation pay based on social justice.The banking business is highly sensitive with a fiduciary
duty towards its client and the public in general, such that centra measures must be strictly observed.The excuse that
his Branch Manager, Pinero, merely prompted him towards such ineptitude is of no moment. He admitted that he
violated established company policy against ringing out checkbooks and bank forms, which means that he was well
aware of the fact that the same was prohibited. Nevertheless, he still chose to, regardless of his superior's influence;
disobey the same not only once, but on numerous occasions. Further, All throughout, there is no showing that he
questioned the acts of Branch Manager Pinero; neither did he take it upon himself to report said irregularities to a
higher authority. Hence, under these circumstances, the award of separation pay based on social justice would
be improper.The Supreme Court finds that the award of separation pay to respondent as a measure of social justice is
not warranted in this case. A contrary ruling would effectively reward respondent for his negligent acts instead of
punishing him for his offense, in observation of the principle of equity.

FACTS:
On November 25, 1985, respondent was initially employed by petitioner Premiere Development Bank (now Security
BankSavings Corporation [SBSC]) as messenger until his promotion as loans processor at its Sangandaan Branch.
Thereafter, he was appointed as Acting Branch Accountant and, in June2007, as Acting Branch Manager. On March
26, 2008, he was assigned to its Quezon Avenue Branch under the supervision of Branch Manager Corazon Pinero
(Pinero) and held the position of Customer Service Operations Head (CSOH) tasked with the safekeeping of its
checkbooks and other bank forms.On July 22, 2008, respondent received a show-cause memorandum from Ms. Ruby
O. Go, head of West RegionalOperations, charging him of violating the bank's Code of Conduct when he mishandled
various checkbooks under his custody.
The matter was referred to SBSC's Investigation Committee which discovered, among others, that as of July11, 2008,
forty-one (41) pre-encoded checkbooks of the Quezon Avenue Branch were missing. At the scheduled conference
before the Investigating Committee, respondent readily admitted having allowed the Branch Manager (i.e.,Pinero) to
bring out of the bank's premises the missing checkbooks and other bank forms on the justification that the latter was a
senior officer with lengthy tenure and good reputation
. He claimed that it was part of Pinero's marketing strategy to procure more clients for the bank and that he did not
receive any consideration for consenting to such practice. He added that the reported missing checkbooks had been
returned by Pinero to his custody after the inventory. Pending investigation, respondent was transferred to SBSC's
Pedro Gil Branch. He was again issued a memorandum directing him to explain his inaccurate reporting of some
Returned Checks and Other Cash Items(RCOCI) which amounted to P46,279.33.
The said uncovered amount was treated as an account receivable for his
account. A month thereafter, respondent was again transferred and reassigned to another branch in Sampaloc, Manila.
Dismayed by his frequent transfer to different branches, respondent tendered his resignation effective thirty (30) days
from submission.However,
SBSC rejected the same in view of its decision to terminate his employment on November 11, 2008 on the ground of
habitual neglect of duties.
Consequently, respondent instituted a complaint for illegal dismissal with prayer for backwages, damages, and
attorney's fees against SBSC and its President, Herminio M. Famatigan,Jr. (petitioners), before the NLRC. In their
defense, petitioners maintained that respondent was validly dismissed for cause on the ground of gross negligence in
the performance of his duties when he repeatedly allowed Pinero to bring outside the bank premises its pre-encoded
checks and accountable forms in flagrant violation of the bank's policies and procedures.
Labor Arbiter: dismissed the complaint and accordingly,declared respondent to have been terminated from
employment for a valid cause. Notwithstanding, the LA awarded respondent separation pay by way of financial
assistance in the amount of P218,500.00.
NLRC:NLRC affirmed the LA decision, ruling that the grant of separation pay was justified on equitable grounds such
as respondent's length of service, and that the cause of his dismissal was not due to gross misconduct or that reflecting
on his moral character but rather, a weakness of disposition and grievous error in judgment.
CA:CA pointed out that separation pay may be allowed as a measure of social justice where an employee was validly
dismissed for causes other than serious misconduct or those reflecting on his moral character. Hence, NLRC
committed no grave abuse of discretion in sustaining the award of separation pay by way of financial assistance.

Philippine Airlines, Inc vs NLRC, GR 123294, 20 October 2010

FACTS:

An investigating committee chaired by Leslie W. Espino formally charged Quijano as Manager-ASAD in connection
with the processing and payment of commission claims to Goldair Pty. Ltd. wherein PAL overpaid commissions to
the latter.

Pending further investigation, the Espino Committee placed Quijano under preventive suspension and at the same time
required her to submit her answer to the charges.

Another Administrative charge involving the same Goldair anomaly was filed, this time including Committee
Chairman Leslie W. Espino and Committee Member Romeo R. Ines and several others, for "gross incompetence and
inefficiency, negligence, imprudence, mismanagement, dereliction of duty, failure to observe and/or implement
administrative and executive policies, and related acts or omissions." Pending the result of investigation by another
committee chaired by Judge Martin S. Ocampo, the PAL Board of Directors suspended respondents.

The Ocampo Committee having submitted its findings to the PAL Board of Directors, the latter considered
respondents resigned from the service effective immediately, for loss of confidence and for acts inimical to the interest
of the company.

Her motion for reconsideration having been denied by the Board, Quijano filed the instant case against PAL for illegal
suspension and illegal dismissal.

The Labor Arbiter dismissed private respondents complaint. Undeterred, private respondent filed an appeal before the
NLRC which rendered the assailed Decision vacated and set aside. Petitioner filed a Motion for Reconsideration but
this was denied by the NLRC.

ISSUE: Whether or not respondent is illegally dismissed?

a) How did the court rationalize the grant of separation pay to Quijano whose mismanagement and gross
incompetence caused PAL to lose millions in Australian dollars?
Habitual Neglect of Duty: The acts of Quijano were not shown as deliberate and intentional (not morally
reprehensible)

HELD:

At the onset, it should be noted that the parties do not dispute the validity of private respondents dismissal from
employment for loss of confidence and acts inimical to the interest of the employer. The assailed September 29, 1995
Decision of the NLRC was emphatic in declaring that it was "not prepared to rule as illegal the preventive suspension
and eventual dismissal from the service of [private respondent]" and rightfully so because the last position that private
respondent held, Manager-ASAD (Agents Services Accounting Division), undeniably qualifies as a position of trust
and confidence.

Loss of confidence as a just cause for termination of employment is premised from the fact that an employee
concerned holds a position of trust and confidence. This situation holds where a person is entrusted with confidence on
delicate matters, such as the custody, handling, or care and protection of the employers property. But, in order to
constitute a just cause for dismissal, the act complained of must be "work-related" such as would show the employee
concerned to be unfit to continue working for the employer.

As a general rule, employers are allowed a wider latitude of discretion in terminating the employment of managerial
personnel or those who, while not of similar rank, perform functions which by their nature require the employers full
trust and confidence. This must be distinguished from the case of ordinary rank and file employees, whose termination
on the basis of these same grounds requires a higher proof of involvement in the events in question; mere
uncorroborated assertions and accusations by the employer will not suffice.

LABOR LAW

The language of Article 279 of the Labor Code is pregnant with the implication that a legally dismissed employee is
not entitled to separation pay, to wit:

An employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights
and other privileges and to his full backwages, inclusive of allowances, and to his other benefits or their monetary
equivalent computed from the time his compensation was withheld from him up to the time of his actual
reinstatement.

However, in exceptional cases, the Court has granted separation pay to a legally dismissed employee as an act of
"social justice" or based on "equity." In both instances, it is required that the dismissal (1) was not for serious
misconduct; and (2) does not reflect on the moral character of the employee or would involve moral turpitude. This
equitable and humanitarian principle was first discussed by the Court in the landmark case of Philippine Long
Distance Telephone Co. (PLDT) v. National Labor Relations Commission.

Serious misconduct as a valid cause for the dismissal of an employee is defined simply as improper or wrong conduct.
It is a transgression of some established and definite rule of action, a forbidden act, a dereliction of duty, willful in
character, and implies wrongful intent and not mere error of judgment. To be serious within the meaning and
intendment of the law, the misconduct must be of such grave and aggravated character and not merely trivial or
unimportant. However serious such misconduct, it must, nevertheless, be in connection with the employees work to
constitute just cause for his separation. The act complained of must be related to the performance of the employees
duties such as would show him to be unfit to continue working for the employer. On the other hand, moral turpitude
has been defined as "everything which is done contrary to justice, modesty, or good morals; an act of baseness,
vileness or depravity in the private and social duties which a man owes his fellowmen, or to society in general,
contrary to justice, honesty, modesty, or good morals."

In the case at bar, the transgressions imputed to private respondent have never been firmly established as deliberate
and willful acts clearly directed at making petitioner lose millions of pesos. At the very most, they can only be
characterized as unintentional, although major, lapses in professional judgment. Likewise, the same cannot be
described as morally reprehensible actions. Thus, private respondent may be granted separation pay on the ground of
equity which this Court had defined as "justice outside law, being ethical rather than jural and belonging to the sphere
of morals than of law. It is grounded on the precepts of conscience and not on any sanction of positive law, for equity
finds no room for application where there is law."
DENIED

Digital Telecommunications, Philippines, Inc. vs Neilson Ayapana, GR 195614, GR 195614, 10 January 2018

DOCTRINE: The willful breach by the employee of the trust reposed in him by his employer or the latter's duly
authorized representative is a just cause for dismissal. Even there is a valid dismissal, separation pay may be
granted as a measure of social justice.

FACTS:
Petitioner hired respondent as Key Accounts Manager for its telecommunication products and services. Respondent
was tasked, among others, to offer and sell DIGITEL's foreign exchange (FEX) line to prospective customers.
Respondent successfully offered two (2) FEX lines for Atimonan, Quezon, to Estela Lim. He received from Lim the
total amount of ₱7,000.00 for the two lines, for which he issued two (2) official receipts. Respondent, however, did
not remit the subject amount to petitioner on the same date.
Respondent learned, from his immediate superior, that there was no available FEX line in Atimonan, Quezon; and that
it was not possible to have a FEX line in the area due to technical constraints. On the same day, respondent retrieved
from Lim the two (2)official receipts issued to the latter and replaced them with an acknowledgment receipt.
The secretary of Lim, went to petitioner's business office to pay bills and to ask for the refund of the subject amount
but there was no existing application for the said service under the name of Star Lala Group of Companies. The
respondent was notified about the request of refund and five (5) days from said notice, that respondent was able to
make the refund.
Petitioner issued a Notice to Explain to respondent, asking him to explain in which the respondent submitted a written
response. On 4 December 2006, petitioner sent a Notice of Offense to respondent, scheduling his administrative
hearing and requesting his presence there. On 19 January 2007, petitioner issued a Notice of Dismissal finding
respondent guilty of "breach by the employee of the trust and confidence reposed in him by management or by a
company representative" under petitioner's disciplinary rules, which merited dismissal for the first offense.
Aggrieved, respondent filed a complaint for illegal dismissal.

a) When an employee is validly dismissed from employment due to loss of trust and confidence, will he be
entitled to separation pay as a measure of social justice?
YES. Even with a finding that respondent was validly dismissed, separation pay may be granted as a measure of social
justice
Generally, an employee dismissed for any of the just causes under Article 297 is not entitled to separation pay. By
way of exception, the Court has allowed the grant of separation pay based on equity and as a measure of social
justice, as long as the dismissal was for causes other than serious conduct or those manifesting moral depravity.
Here, while it is clear that respondent's act constitutes a willful breach of trust and confidence that justified his
dismissal, it also appears that he was primarily actuated by zealousness in acquiring and retaining subscribers rather
than any intent to misappropriate company funds; as he admitted in his response to the notice to explain that offering
an alternative FEX line to Lim was part of his strategy to ensure her subscription.

Respondent’s zealousness was manifested through acts that showed an inordinate lapse of judgment warranting his
dismissal in accordance with management prerogative, but this Court considers in his favor the above circumstances in
granting him separation pay in the amount of one (1) month pay for every year of service.

b) What factors were considered in deviating from applying the ruling in the landmark case of Toyota Motor
Phils Corp Workers Association vs NLRC, GR 158786, 158789 & 158798-99, 19 October 2007 discussed in the
preceding case of Security Bank Savings Corp vs Singson?
He was awarded multiple commendations during his tenure, showing proof of his character.

Here, while it is clear that respondent's act constitutes a willful breach of trust and confidence that justified his
dismissal, it also appears that he was primarily actuated by zealousness in acquiring and retaining subscribers rather
than any intent to misappropriate company funds; as he admitted in his response to the notice to explain that offering
an alternative FEX line to Lim was part of his strategy to ensure her subscription.

Is the respondent guilty of breach of trust and confidence reposed in him by the petitioner?
Yes. Respondent held a position of trust and confidence and committed an act that justified petitioner's loss of trust
and confidence.
The willful breach by the employee of the trust reposed in him by his employer or the latter's duly authorized
representative is a just cause for dismissal. However, the validity of a dismissal based on this ground is premised upon
the concurrence and confidence; and (2) there must be a willful act that would justify the loss of trust and confidence.

The first requisite is certainly present. In a number of cases, this Court has held that rank-and-file employees who are
routinely charged with the care and custody of the employer's money or property are classified as occupying positions
of trust and confidence. It is not disputed that respondent was tasked to solicit subscribers for petitioner's FEX line
and, in the course thereof, collect money for subscriptions and issue official receipts therefor, as was the case in the
transaction subject of this controversy. Being involved in the handling of the company's funds, respondent undeniably
occupies a position of trust and confidence.
The records likewise reveal that the second requisite is present. It must be emphasized that a finding that an
employer's trust and confidence has been breached by the employee must be supported by substantial evidence, or
such amount of relevant evidence which a reasonable mind might accept as adequate to justify a conclusion. It must
not be based on the employer's whims or caprices or suspicions; otherwise, the employee would eternally remain at
the mercy of the employer.
The totality of the circumstances in the case at bar supports a conclusion that respondent's dismissal was based on
substantial evidence that he had willfully breached the trust reposed upon him by petitioner, and that petitioner was
not actuated by mere whim or capriciousness.

Minda Cadavas vs Court of Appeals, GR 228765, 20 March 2019

PETITIONER Minda Cadavas was hired as a staff nurse by respondent Davao Doctors Hospital (DDH). She was later
promoted to nurse supervisor. Sometime in February 2012, Cadavas’ aunt, Shirley Aninion, was confined at DDH for
stage four breast cancer. Cadavas, with the help of some hospital staff, was able to obtain supplies and medicines used
in her aunt’s operation from the Emergency Department and Operating Room Central Supply Service without being
entered in the records so that said supplies and medicines would not be charged to her aunt’s bill, but Cadavas would
replace and eventually replaced them. During the administrative hearing, Cadavas admitted that she was aware of the
hospital policy prohibiting what she did, but alleged it has been a long practice among employees. Subsequently,
Cadavas was dismissed from the service for dishonesty and loss of trust and confidence.

Is the dismissal justified? Yes.

In the minutes of the administrative hearing conducted by respondent DDH, petitioner admitted that there is no policy
that employees can borrow supplies for personal use. She also admitted that she was aware of the hospital’s policy
against the purchase of medicines outside the hospital. She apologized for buying medicines and supplies outside the
hospital (to replace the ones used by her aunt). Thus, it is clear that despite knowing that there is a policy against the
purchase of supplies and medicines outside the hospital, petitioner chose to violate the policy by asking a nursing aide
if she could replace the supplies and medicines used by her aunt. As the nursing aide acceded to petitioner’s request,
the medicines and supplies used by petitioner’s aunt were not recorded and charged to her per the agreement that
petitioner would replace the said medicines and supplies. In effect, petitioner caused the transaction not to be
recorded. Although petitioner was not then performing her duties and functions as nurse supervisor in her
departments, nevertheless, as an employee and nurse supervisor of respondent DDH, she was covered by the policy
against the use of hospital medicines and supplies without recording such use, and purchasing medicines and supplies
outside of respondent hospital to replace hospital medicines and supplies already used. Notably, petitioner was aware
of such hospital policy, but she still violated it. As a nurse supervisor holding a position of trust, petitioner was
expected to enforce and observe hospital policies. Clearly, petitioner breached the trust and confidence reposed in her
by respondent DDH by her willful violation of the said hospital policy, causing loss of income to respondent DDH. As
a general rule, employers are allowed a wider latitude of discretion in terminating the services of employees who
perform functions by which their nature requires the employer’s full trust and confidence. Mere existence of basis for
believing that the employee has breached the trust and confidence of the employer is sufficient and does not require
proof beyond reasonable doubt.
a) What is the basis for the variance in the ruling of the Supreme Court in this case, and the preceding case of
Digital Telecommunications, Philippines, Inc. vs Ayapana, on the entitlement of a validly dismissed employee to
separation pay as a measure of social justice?
She was dismissed for wilful disobedience, gross and habitual neglect of duty. She benefitted from her own violations
of the company policy.
Willful breach of trust
Notably, petitioner was aware of such hospital policy, but she still violated it. As a nurse supervisor holding a position
of trust, petitioner was expected to enforce and observe hospital policies. Clearly, petitioner breached the trust and
confidence reposed in her by respondent DDH by her willful violation of the said hospital policy, causing loss of
income to respondent DDH.
Herma Shipping and Transport Corporation et al. vs Calvin Cordero, GR No. 244144,
27 January 2020
a) May an employee dismissed for a just cause be entitled to separation pay
as a measure of social justice in the light of the employee’s long years of
service? NO
a) May an employee dismissed for a just cause be entitled to separation pay as a measure of social justice in the
light of the employee’s long years of service?

Philippine Geothermal, Inc. Employees Union vs Unocal Phils., Inc., 28 September 2016
Facts: Philippine Geothermal, Inc. Employees Union is a legitimate labor union that stands as the bargaining agent of
the rank-and-file employees of Unocal Philippines. Unocal Philippines, formerly known as Philippine Geothermal,
Inc., is a foreign corporation incorporated under the laws of the State of California, United States of America, licensed
to do business in the Philippines for the “exploration and development of geothermal resources as alternative sources
of energy.” It is a wholly owned subsidiary of Union Oil Company of California (Unocal California), which, in turn, is
a wholly owned subsidiary of Union Oil Corporation (Unocal Corporation).

Unocal Philippines operates two (2) geothermal steam fields in Tiwi, Albay and Makiling, Banahaw, Laguna, owned
by the National Power Corporation.

On April 4, 2005, Unocal Corporation executed an Agreement and Plan of Merger (Merger Agreement) with Chevron
Texaco Corporation (Chevron) and Blue Merger Sub, Inc. (Blue Merger). Blue Merger is a wholly owned subsidiary
of Chevron. Under the Merger Agreement, Unocal Corporation merged with Blue Merger, and Blue Merger became
the surviving corporation. Chevron then became the parent corporation of the merged corporations: After the merger,
Blue Merger, as the surviving corporation, changed its name to Unocal Corporation.

On January 31, 2006, Unocal Philippines executed a Collective Bargaining Agreement with the Union.

However, on October 20, 2006, the Union wrote Unocal Philippines asking for the separation benefits provided for
under the Collective Bargaining Agreement. According to the Union, the Merger Agreement of Unocal Corporation,
Blue Merger, and Chevron resulted in the closure and cessation of operations of Unocal Philippines and the implied
dismissal of its employees.

Issue: Whether or not the the merger resulted to cessation of employees.

Held: No. A merger is a consolidation of two or more corporations, which results in one or more corporations being
absorbed into one surviving corporation. The separate existence of the absorbed corporation ceases, and the surviving
corporation “retains its identity and takes over the rights, privileges, franchises, properties, claims, liabilities and
obligations of the absorbed corporation(s).”
If respondent is a subsidiary of Unocal California, which, in turn, is a subsidiary of Unocal Corporation, then the
merger of Unocal Corporation with Blue Merger and Chevron does not affect respondent or any of its employees.
Respondent has a separate and distinct personality from its parent corporation.

Nonetheless, if respondent is indeed a party to the merger, the merger still does not result in the dismissal of its
employees.

Although this provision does not explicitly state the merger’s effect on the employees of the absorbed corporation,
Bank of the Philippine Islands v. BPI Employees Union-Davao Chapter Federation of Unions in BPI Unibank has
ruled that the surviving corporation automatically assumes the employment contracts of the absorbed corporation,
such that the absorbed corporation’s employees become part of the manpower complement of the surviving
corporation.

Merger is not one of the circumstances where the employees may claim separation pay. The only instances where
separation pay may be awarded to petitioner are: (a) reduction in workforce as a result of redundancy; (b)
retrenchment or installation of labor-saving devices; or (c) closure and cessation of operations.

The terms do not provide that a merger is one of the instances where petitioner may claim separation benefits for its
members. Neither can these circumstances be interpreted as to contemplate a merger with another corporation. In any
case, if the parties intended that petitioner ought to be granted separation pay in case of a merger, it should have been
explicitly provided for in the contract. Absent this express intention, petitioner cannot claim
separation pay.been explicitly provided for in the contract. Absent this express intention, petitioner cannot claim
separation pay.

a) Did the merger of Unocal Philippines’ parent corporation with another corporation impliedly terminate the
employment of the Union’s members? NO
b) Should the employees be deemed absorbed, will this not violate the freedom to contract and the prohibition
against involuntary servitude?
Petitioner insists that this is contrary to its freedom to contract, considering its members did not enter into employment
contracts with the surviving corporation. However, petitioner is not precluded from leaving the surviving corporation.
Although the absorbed employees are retained as employees of the merged corporation, the employer retains the right
to terminate their employment for a just or authorized cause. Likewise, the employees are not precluded from severing
their employment through resignation or retirement. The freedom to contract and the prohibition against involuntary
servitude is still, thus, preserved in this sense.84 This is the manner by which the consent of the employees is
considered by the law.
c) Are the absorbed employees entitled to separation pay on account of such merger?

ON DUE PROCESS
Ruben Serrano vs NLRC and Isetann Department Store, GR 117040, 27 January 2000

FACTS
Ø Ruben Serrano was hired by Isetann Dept. Store as a security checker
Ø 1984 – Contractual; 1985 – Regular; 1988 – Head of Security Checkers
Ø In 1991, as a cost-cutting measure, Isetann decided to phase out the entire security section and engage the
services of an independent security agency.
Ø Isetann sent a memo to Serrano on 11 Oct 1991, reiterating their verbal notice of termination effective on the
same day.
Ø Serrano filed a complaint on 3 Dec 1991 for illegal dismissal, illegal layoff, unfair labor practice, underpayment
of wages, nonpayment of salary and overtime pay

Labor Arbiter held that Serrano was illegally dismissed

• Failed to establish that the cause of retrenchment is to minimize losses
• Did not accord due process to Serrano
• Did not use reasonable standards in selecting employees to be terminated
• Did not show employees’ inefficiency so as to justify their replacement
• The day after Serrano’s dismissal, Isetann hired another person as a safety and security supervisor
• Isetann ordered to pay backwages, reinstatement, unpaid wages, 13th month pay, attorney’s fees
NLRC reversed Labor Arbiter’s decision upon Isetann’s appeal
• Phase-out of security section, hiring of agency is a legitimate business decision
• Labor Arbiter’s distinction between retrenchment and employment of cost-saving devices insignificant
• Reasonable criteria does not apply because the entire Security Section was abolished
• No bad faith in appointing a supervisor because it was separate from Serrano’s position as Security Checkers
head
• Isetann ordered to give separation pay, unpaid salary, 13th month pay
• Serrano’s MfR denied

WON the abolition of the Security Checkers section and the employment of an independent security agency
falls under any of the authorized causes for dismissal under Article 283 of the Labor Code - YES, authorized
cause is redundancy; Serrano should be given separation pay at the rate of one-month pay for every year of service
(Art. 283)

DISCUSSION
Art. 283 provides that one month before intended date, written notice must be served on the workers and DOLE

Absent proof that management acted in a malicious or arbitrary manner, the Court will not interfere with the
employer’s exercise of judgment.
That the phase-out constituted a legitimate business decision is a factual finding of NLRC.

History of policies
When there is just cause but no due process (requirements of notice and opportunity to be heard)
Before: Dismissal is illegal
The shift took place in Wenphil Corp. v. NLRC
Ø Highly prejudicial to the employer’s interests to reinstate an employee who has been shown to be guilty of the
charges that warranted his dismissal
Ø Dismissal must be for just or authorized cause and after due process
Now: Dismissal shall be upheld but the employer must be sanctioned for non-compliance with the requirements of, or
for failure to observe, due process (Sebuguero v. NLRC)
Ø Fines imposed range from P1,000 to P10,000

Then next is Serrano na

Reexamining Wenphil doctrine

Ø J. Panganiban – Monetary sanctions are too insignificant, niggardly, late

Ø J. Puno – “Dismiss now, pay later” policy convenient for moneyed employers
Ø In their opinion, such dismissal is void and employee should be reinstated and paid backwages

Remedy – pay full backwages (in cases of illegal dismissal/authorized cause) from dismissal until determination that
dismissal was for a just cause BUT STILL, dismissal must be upheld; penalty for the employer

a) Is an employer’s failure to comply with the prior notice and hearing requirement in termination of
employment tantamount to a violation of the Constitutional Due Process clause? Why? NO
Why violation of the notice requirement cannot be considered a denial of due process resulting in the nullity of
dismissal
Due process clause is a limitation on governmental powers and DOES NOT APPLY to the exercise of private power
a. Only the state has authority to take life, liberty, property
b. Purpose of clause is to ensure that the exercise of this power is consistent with civilized methods

Notice and hearing are required under the due process clause before the power of the organized society is brought to
bear upon the individual
a. This is NOT the case of termination of employee – no adversary system here (there is no charge against the
employee)
b. Purpose of 30-day written notice is to give employee time to prepare for the eventual job loss, and for DOLE to
determine WON economic causes exist to justify his termination
c. Even in cases of dismissal under Article 282[1], purpose of notice and hearing is NOT to comply with the due
process clause in the Constitution; Compliance with notice requirement does not foreclose right of employee to
question the legality of his dismissal

Employer CANNOT be expected to be an impartial judge of his own cause

Also the case for termination for a just cause under Article 282
J. Puno disputes this as he says that many cases have been won by employees before grievance committees manned by
impartial judges of the company
Grievance machinery is DIFFERENT – established by agreement of employer, employees and is composed of
representatives from both sides

If the violation of the notice requirement is not a denial of due process, what is it?
Mere failure to observe a procedure for the termination of employment, which makes the termination
merely ineffectual

What makes a dismissal of an employee illegal?

Only the absence of a just cause for termination as provided in Article 279

Authorized
Basis Notice Reinstate Kind of pay
cause
Art. 283 P Î Î Separation pay, backwages
Art. 283 Î Î P Backwages
Backwages from termination until it is determined
Art. 282 P Î Î
that there is just cause

DISPOSITIVE PORTION
Petition granted. NLRC resolution modified. Isetann is ordered to:
• Pay separation pay equivalent to one month pay per year of service
• Unpaid salary
• Proportionate 13th month pay
• Full backwages from termination until this decision becomes final
Case remanded to Labor Arbiter to determine computation of monetary awards to Serrano.

OPINIONS [2]

Separate Opinion – Bellosillo

• Prefers to call indemnity or penalty as disturbance compensation
• Proposes that amount of the award be uniform and rational and not arbitrary
Dissenting Opinion – Puno
• Wenphil did not change ruling that violation of the pre-dismissal notice requirement is an infringement of due
process
• Submits a return to the pre-Wenphil rule where a reasonless violation of the notice requirement makes the
dismissal illegal and results in the employee’s reinstatement
• One undesirable effect of Wenphil is to compel employees to seek relief against illegal dismissals with DOLE
(whereas before, a remedy can be sought before the employer) and oftentimes, they do not know why they were
dismissed in the first place
• Dilution of the rule has been abused by employers who followed the “dismiss now, pay later” strategy
• An employee under Article 283 has a stronger claim to the right to a pre-dismissal notice and hearing (rather
than post facto dismissal hearing)
• Disagrees with majority opinion that due process requirement does not apply to the exercise of private power;
private due process is a settled norm in administrative law
Separate Opinion – Vitug
• A just or authorized cause and a written notice are required concurrently but not equipollent in their
consequence in terminating an employer-employee relationship
• Where there is no just or authorized cause, reinstatement and payment of backwages would be proper.
Damages might also be awarded if dismissal is attended by bad faith of employer. Separation pay can substitute for
reinstatement if such reinstatement is not feasible.
• Employer must be made to pay corresponding damages for failure to comply with notice requirement
Separate Opinion – Panganiban
• Notice requirement finds basis not only in the Labor Code but also in the due process clause of the
Constitution
• When the employee is dismissed without due process, he is illegally dismissed. He is entitled to backwages
and reinstatement.
• The Labor Code grants the dismissed employee the right to be notified as well as the right to be heard.

b) What reliefs were awarded to Serrano for having been dismissed without prior notice and hearing?
The decision in this case, providing for the payment of full backwages for failure of an employer to give notice, seeks
to vindicate the employees right to notice before he is dismissed or laid off, while recognizing the right of the
employer to dismiss for any of the just causes. The remedy is to order the payment to the employee of full backwages
from the time of his dismissal until the court finds that the dismissal was for a just cause. But, otherwise, his dismissal
must be upheld and he should not be reinstated. This is because his dismissal is ineffectual
c) What was the prevailing jurisprudence on the effect of non-observance of prior notice and hearing in the
termination of employment?
c) What is the Pre-Wenphil Doctrine?
The Wenphil Doctrine imposes a fine on an employer who is found to have dismissed an employee for cause without
prior notice. This has been found to be ineffective in deterring employer violations of the notice requirement. Thus
the present ruling of the Court is that the dismissal of the employee is merely ineffectual, not void

Jenny Agabon and Virgilio Agabon vs NLRC, et al, GR 158693, 17 November 2004

Private respondent Riviera Home Improvements, Inc. is engaged in the business of selling and installing ornamental
and construction materials. It employed petitioners Virgilio Agabon and Jenny Agabon as gypsum board and cornice
installers on January 2, 1992 until February 23, 1999 when they were dismissed for abandonment of work/worked
with other company. Thus, Petitioners then filed a complaint for illegal dismissal and payment of money claims

Petitioners also claim that private respondent did not comply with the twin requirements of notice and hearing. Private
respondent, on the other hand, maintained that petitioners were not dismissed but had abandoned their work.

a) What are the different classifications of due process?

Constitutional due process protects the individual from the government and assures him of his rights in criminal, civil
or administrative proceedings; while statutory due process found in the Labor Code and Implementing Rules protects
employees from being unjustly terminated without just cause after notice and hearing.

b) In both Serrano and Agabon cases, the employer dismissed employees without observing the prior notice
and hearing required, but the relief granted were different. Why?
In Serrano Case, the dismissal was for authorized cause, which is redundancy.
In Agabon case, the dismissal was for just cause which is abandonement

The dismissal should be upheld because it was established that the petitioners abandoned their jobs to work for
another company. Private respondent, however, did not follow the notice requirements and instead argued that sending
notices to the last known addresses would have been useless because they did not reside there anymore. Unfortunately
for the private respondent, this is not a valid excuse because the law mandates the twin notice requirements to the
employee’s last known address. Thus, it should be held liable for non-compliance with the procedural requirements of
due process.

Wenphil: where the employer had a valid reason to dismiss an employee but did not follow the due process
requirement, the dismissal may be upheld, but the employer must pay an indemnity to the employee.
Wenphil was the prevailing doctrine until it was changed on January 27, 2000 by Serrano. It was held in the latter
case that a violation of the notice requirement in a termination for a just or authorized cause was not a denial of due
 process that would nullify the termination. Rather, such violation would make the dismissal ineffectual and require the
employer to pay full back wages from the time of termination until a judicial declaration that the dismissal was for a
just or authorized cause. By requiring employers to pay full back wages, Serrano was intended to provide a deterrent
to violations of the notice requirement better than Wenphil did. Serrano thus confronted the practice of employers who
were wont to “dismiss now and pay later.”

c) What is the difference between the payment of indemnity upheld in the earlier case of Wenphil Corporation
mentioned in this case and the Serrano case, and the payment of nominal damages ordered in this case?
In Agabon, the Court held that Serrano had not considered the full meaning of Article 279[9] of the Labor Code,
which provides that a termination is illegal only if it is not for any of the just or authorized causes provided by law.
Consequently, the payment of back wages and other benefits, including reinstatement, is justified only if the employee
was unjustly dismissed.

Where the dismissal was for a just cause, as in Agabon, the Court opined that the better rule was to abandon the
Serrano doctrine and to revert to Wenphil. Hence, the lack of statutory due process should not nullify the dismissal or
render it illegal or ineffectual. For violation of a statutory right, the employer should be sanctioned with indemnity or
penalty -- this time stiffer than that in Wenphil -- so as to discourage the abhorrent “dismiss now, pay later” practice.
Considering the prevailing circumstances in this case, nominal damages were fixed at P30,000 for each petitioner.

Abandonment is the deliberate and unjustified refusal of an employee to resume his employment. It is a form of
neglect of duty, hence, a just cause for termination of employment by the employer.

Standards of due process: requirements of notice. – In all cases of termination of employment, the following
standards of due process shall be substantially observed:

For termination of employment based on just causes as defined in Article 282 of the Code:

1. A written notice served on the employee specifying the ground or grounds for termination, and giving to said
employee reasonable opportunity within which to explain his side;
2. A hearing or conference during which the employee concerned, with the assistance of counsel if the employee so
desires, is given opportunity to respond to the charge, present his evidence or rebut the evidence presented against him;
and
3. 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.
In case of termination, the foregoing notices shall be served on the employee’s last known address.

Procedurally,
(1) if the dismissal is based on a just cause under Article 282, the employer must give the employee two written
notices and a hearing or opportunity to be heard if requested by the employee before terminating the employment: a
notice specifying the grounds for which dismissal is sought a hearing or an opportunity to be heard and after hearing
or opportunity to be heard, a notice of the decision to dismiss; and
(2) if the dismissal is based on authorized causes under Articles 283 and 284, the employer must give the employee
and the Department of Labor and Employment written notices 30 days prior to the effectivity of his separation.

From the foregoing rules four possible situations may be derived: (1) the dismissal is for a just cause under Article 282
of the Labor Code, for an authorized cause under Article 283, or for health reasons under Article 284, and due process
was observed; (2) the dismissal is without just or authorized cause but due process was observed; (3) the dismissal is
without just or authorized cause and there was no due process; and (4) the dismissal is for just or authorized cause but
due process was not observed.

The present case squarely falls under the fourth situation. The dismissal should be upheld because it was established
that the petitioners abandoned their jobs to work for another company. Private respondent, however, did not follow the
notice requirements and instead argued that sending notices to the last known addresses would have been useless
because they did not reside there anymore. Unfortunately for the private respondent, this is not a valid excuse because
the law mandates the twin notice requirements to the employee’s last known address. Thus, it should be held liable for
non-compliance with the procedural requirements of due process.

Jaka Food Processing Corporation vs Pacot, GR 151378, 28 March 2005

Sanction should be stiffer when employer fail to comply with the notice requirement when dismissal is based on
authorized causes.

Respondents Darwin Pacot, et.al. were hired by the Petitioner Jaka Food Processing Corp. (JAKA) until their services
were terminated in August 1997 because the corporation was in dire financial straits. However, JAKA failed to
comply with the notice requirement under Article 283 of the Labor Code, which provides that a written notice must be
served to affected employees at least one (1) month before the intended date of termination. Thus, the Respondents
filed a case of illegal dismissal before the Labor Arbiter.

The Labor Arbiter (LA) declared the termination illegal and ordered Jaka to reinstate the Respondents with full
backwages; otherwise, Jaka is ordered to pay the Respondents with separation pay. On appeal before the National
Labor Relations Commission (NLRC), the LA decision was affirmed in toto, only to be modified upon Motion for
Reconsideration. Jaka went to the Court of Appeals, which only modified the decision of the NLRC but still awarded
separation pay.

Hence, this Petition.

1. Whether or not the Respondents are entitled to separation pay. NO

In all cases of business closure or cessation of operation, the affected employee is entitled to separation pay. However,
the Supreme Court ruled that as an exception to this general rule the closure of business or cessation of operation due
to serious business losses or financial reverses. In which case, the right of the affected employee to separation pay is
lost for obvious reasons. In the present case, the Respondents did not assail the fact that JAKA was suffering from
serious business losses. Hence, they are not entitled to separation pay.

2. Whether or not the Respondents are entitled to nominal damages. YES

If the dismissal is based on an authorized cause, and the employer failed to comply with the notice requirement, the
sanction should be stiffer because the dismissal process was initiated by the employer’s exercise of his management
prerogative. This is different when the dismissal is based on just causes whereby dismissal was initiated by the an act
imputable to the employee.

In the present case, JAKA was suffering from serious business loss which prompted them to terminate the
employment of the Respondents. However, it is also established that JAKA failed to comply with the notice
requirement under Art. 283. As such, it is proper to award nominal damages to the Respondents, although dismissal
was considered legal.

a) What is the difference between procedurally defective dismissals due to a just cause, on the one hand, and
those due to an authorized cause, on the other?
Accordingly, it is wise to hold that: (1) if the dismissal is based on a just cause under Article 282 but the employer
failed to comply with the notice requirement, the sanction to be imposed upon him should be tempered
(moderate) because the dismissal process was, in effect, initiated by an act imputable to the employee; and (2) if the
dismissal is based on an authorized cause under Article 283 but the employer failed to comply with the notice
requirement, the sanction should be stiffer because the dismissal process was initiated by the employer's exercise of
his management prerogative.

Distribution& Control Products, Inc. et al vs Jeffrey Santos, GR No. 212616, 10 July 2017

petitioner is a domestic corporation engaged in the business of selling and distributing electrical products and
equipment with petitioner Vincent M. Tiamsic as its president. Respondent, on the other hand, was employed as
petitioners' company driver.

On July 25, 2011, respondent filed against petitioners a complaint for constructive illegal dismissal and payment of
separation pay. In his Position Paper6, respondent contended that: he started working as petitioners' company driver on
April 5, 2005; on December 16, 2010, he received a notice informing him that he was being placed under preventive
suspension for a period of thirty (30) days beginning December 17, 2010 because he was one of the employees
suspected of having participated in the unlawful taking of circuit breakers and electrical products of petitioners; a
criminal complaint was filed against him and several other persons with the Prosecutor's Office of Mandaluyong City;
he immediately inquired from petitioner company's Human Resources Department as to the exact reason why he was
suspended because he was never given the opportunity to explain his side before he was suspended but the said
Department did not give him any concrete explanation; and after the lapse of his 30-day suspension he was no longer
allowed to return to work without any justification for such disallowance.

On their part, petitioners claimed in their Position Paper7 that: they employed respondent as their company driver
whose job included the delivery of items purchased by customers, receipt documentation and recording of previously
purchased products which were returned by customers and coordination with the company warehouseman and the
accounting department concerning all items which are subject of delivery and receipt by the company; on February 19,
2010, petitioner corporation, through its hired auditors, conducted a physical stock inventory of all materials stored in
the company's warehouse and in its office building; after such inventory, it was found out that a number of electrical
materials and products with an estimated value of P457,394.35, were missing; a subsequent inventory on April 24,
2010 likewise revealed that a 2000-ampere circuit breaker worth P106,341.75 was also missing, as well as thirty-seven
(37) pieces of 40-ampere circuit breakers which had a total value of P39,940.04; herein respondent and the company
warehouseman were the only persons who had complete access to the company warehouse as they were entrusted with
the handling of all products from the company's suppliers; considering the size and weight of the missing items, they
can only be carried by no less than two (2) persons; petitioners demanded an explanation from respondent and the
warehouseman, but they failed to make an account as to how these products had gone missing from the warehouse and
office building; as such, petitioners filed a criminal complaint for qualified theft and, thereafter, they suspended herein
respondent; and after the lapse of his suspension, respondent no longer returned to work.

a) Was the employee afforded his right to due process in the termination of his employment? NO

The only notice given by petitioners to respondent was the notice of his 30-day preventive suspension and, as found
by the LA, nothing therein indicated that he was required nor was given the opportunity to explain his side,
considering that he was being implicated in the theft of the subject circuit breakers and other electrical products. It is
true that petitioners conducted their own investigation but the same was made without the participation of respondent.

As to the required notice of termination, petitioners allege that they did not terminate respondent from his employment
and that it was the latter who actually decided to abandon his job. However, the LA, the NLRC and the CA again
unanimously found that petitioners failed to substantiate their allegation and the Court finds no cogent reason to depart
from such finding.

In the instant case, petitioners contend that their termination of respondent's employment was based on their loss of
trust and confidence in him.

Loss of trust and confidence is a just cause for dismissal under Article 282(c) of the Labor Code, which provides that
an employer may terminate an employment for "[f]raud or willful breach by the employee of the trust reposed in him
by his employer or duly authorized representative."

However, in order for the employer to properly invoke this ground, the employer must satisfy two conditions.

First, the employer must show that the employee concerned holds a position of trust and confidence.15 Jurisprudence
provides for two classes of positions of trust.16 The first class consists of managerial employees, or those who, by the
nature of their position, are entrusted with confidential and delicate matters and from whom greater fidelity to duty is
correspondingly expected.17 The second class includes "cashiers, auditors, property custodians, or those who, in the
normal and routine exercise of their functions, regularly handle significant amounts of [the employer's] money or
property."18

Second, the employer must establish the existence of an act justifying the loss of trust and confidence.19 To be a valid
cause for dismissal, the act that betrays the employer's trust must be real, i.e., founded on clearly established facts, and
the employee's breach of the trust must be willful, i.e., it was done intentionally, knowingly and purposely, without
justifiable excuse.20 Moreover, with respect to rank-and-file personnel, loss of trust and confidence, as ground for
valid dismissal, requires proof of involvement in the alleged events in question, and that mere uncorroborated
assertions and accusations by the employer will not be sufficient.21
s, petitioners were not able to establish the existence of an act justifying their alleged loss of trust and confidence in
respondent.

Mejila vs Wrigley Philippines, Inc., GR Nos. 199469 & 199505, 11 September 2019

WPI is a corporation engaged in the manufacturing and marketing of chewing gum. It engaged the services of Mejila,
a registered nurse, as an occupational health practitioner for its Antipolo manufacturing facility sometime in April
2002. Her employment status was initially on a contractual basis until she was regularized effective January 1, 2007.3

On October 26, 2007, WPI sent a memorandum to Mejila informing her that her position has been abolished as a
result of the company's manpower rationalization program and that her employment will be terminated effective
November 26, 2007. The memorandum stated that Mejila is no longer required to work beginning the same day,
October 26, although her salary will be paid until November 26. It also required Mejila to turn over all company
properties no later than October 26. WPI granted her separation pay at the rate of 1.5 months every year of service,
cash conversion of unused leaves, one-year extension of medical insurance, and pro rata 13th month pay, New Year
pay, and mid-year pay, which shall be released upon return of all properties and completion of the exit clearance
process.4 On the same date, WPI notified the Department of Labor and Employment's (DOLE) Rizal Field Office of
its decision to terminate Mejila and two others due to redundancy.(Dapat sa regional office)

In the meantime, WPI engaged the services of Activeone Health, Inc. to take over the services previously handled by
the occupational health practitioners starting November 1, 2007.6 The abolition of WPI's in-house clinic services and
decision to hire an independent contractor for clinic operations was part of the management's Headcount Optimization
Program designed to improve cost efficiency, considering that clinic management is not an integral part of WPI's
business.7 Like Mejila, Dr. Marilou L. Fonollera and nurse Soccoro Laarni B. Edurise were also terminated due to
redundancy.8

Mejila filed a complaint for illegal dismissal against WPI and its officers, Jesselyn Panis, and Michael Panlaqui, who
are WPI's Factory Director and People Learning and Development Manager, respectively. The Labor Arbiter9 ruled
that Mejila was illegally dismissed and held that WPI failed to comply with the procedural due process requirements,
particularly when it sent the notice to DOLE's Rizal Field Office, instead of the Regional Office. In addition, the
Labor Arbiter found that the outsourcing of clinic operations is more expensive for WPI, which belies its intention to
economize. Accordingly, WPI was ordered to reinstate Mejila and to pay her full backwages, moral damages,
exemplary damages, and attorney's fees.

a) What is the Garden Leave Clause?

The practice of the employer directing an employee not to attend work during the period of notice of resignation or
termination of the employment is colloquially known as "'garden leave" or "gardening leave." The employee might be
given no work or limited duties, or be required to be available during the notice period to, for example, assist with the
completion of work or ensure the smooth transition of work to their successor. Otherwise, the employee is given no
work and is directed to have no contact with clients or continuing employees. During the period of garden leave,
employees continue to be paid their salary and any other contractual benefits as if they were rendering their services to
the employer.
b) Does it violate the statutory procedural due process requirement in termination of employment? NO
In the Philippines, garden leave has been more commonly used in relation to the 30-day notice period for authorized
causes of termination. There is no prohibition under our labor laws against a garden leave clause in an employment
contract.

In implementing a redundancy program, Article 298 requires employers to serve a written notice to both the affected
employees and the DOLE at least one month prior to the intended date of termination. Under Rook V, Rule XXIII,
Section 2 of the Implementing Rules and Regulations of the Labor Code,28 this procedural requirement is "deemed
complied with upon service of a written notice to the employee and the appropriate Regional Office of the Department
at least thirty days before the effectivity of the termination, specifying the ground or grounds for termination."

The form, therefore, is not the equivalent or substitute for the notice required by law. Thus, regardless of whether
DOLE allows the form to be filed with its field offices, it does not change the rule that the notice must be filed with
the regional office.
After finding that both notices to Mejila and the DOLE were defective, We accordingly hold that WPI is liable to pay
nominal damages in the sum of P50,000.00

Abbot Laboratories, Philippines vs Alcaraz, GR 192571, 22 April 2014

Petitioners contend that Alcaraz was terminated because she failed to qualify as a regular employee according to Abb
ott’s standards which were made known to her at the time of her engagement. Contrarily, Alcaraz claims that Abbott n
ever apprised her of these standards and thus, maintains that she is a regular and not a mere probationary employee.

The LA said that Alcaraz was apprised of the standards to be regular employee. The CA said that she was not apprise
d at the start of her employment of the reasonable standards under which she could qualify as a regular employee. This
was based on its examination of the employment contract which showed that the same did not contain any standard of
performance or any stipulation that Alcaraz shall undergo a performance evaluation before she could qualify as a regu
lar employee.

ISSUE: Was Alcaraz illegally dismissed?

HELD: The probationary employee may also be terminated for failure to qualify as a regular employee in
accordance with the reasonable standards made known by the employer to the employee at the time of the
engagement.

A probationary employee, like a regular employee, enjoys security of tenure. However, in cases of probationary
employment, aside from just or authorized causes of termination, an additional ground is provided under Article 295
of the Labor Code, i.e., the probationary employee may also be terminated for failure to qualify as a regular employee
in accordance with the reasonable standards made known by the employer to the employee at the time of the
engagement. Thus, the services of an employee who has been engaged on probationary basis may be terminated for
any of the following: (a) a just or (b) an authorized cause; and (c) when he fails to qualify as a regular employee in
accordance with reasonable standards prescribed by the employer.

A punctilious examination of the records reveals that Abbott had indeed complied with the above-stated requirements.
This conclusion is largely impelled by the fact that Abbott clearly conveyed to Alcaraz her duties and responsibilities
as Regulatory Affairs Manager prior to, during the time of her engagement, and the incipient stages of her
employment. On this score, the Court finds it apt to detail not only the incidents which point out to the efforts made by
Abbott but also those circumstances which would show that Alcaraz was well-apprised of her employers expectations
that would, in turn, determine her regularization.

Abbott caused the publication in a major broadsheet newspaper of its need for a Regulatory Affairs Manager,
indicating therein the job description for as well as the duties and responsibilities attendant to the aforesaid position. In
Abbotts December 7, 2004 offer sheet, it was stated that Alcaraz was to be employed on a probationary status. On the
day Alcaraz accepted Abbotts employment offer, Bernardo sent her copies of Abbotts organizational structure and her
job description through e-mail. Alcaraz was made to undergo a pre-employment orientation where Almazar informed
her that she had to implement Abbotts Code of Conduct and office policies on human resources and finance and that
she would be reporting directly to Walsh. Alcaraz received copies of Abbotts Code of Conduct and Performance
Modules from Misa who explained to her the procedure for evaluating the performance of probationary employees;
she was further notified that Abbott had only one evaluation system for all of its employees.

Considering the totality of the above-stated circumstances, it cannot, therefore, be doubted that Alcaraz was well-
aware that her regularization would depend on her ability and capacity to fulfill the requirements of her position as
Regulatory Affairs Manager and that her failure to perform such would give Abbott a valid cause to terminate her
probationary employment.

An employer who terminates an employee for a valid cause but does so through invalid procedure is liable to
pay the latter nominal damages.

Despite the existence of a sufficient ground to terminate Alcarazs employment and Abbotts compliance with the Labor
Code termination procedure, it is readily apparent that Abbott breached its contractual obligation to Alcaraz when it
failed to abide by its own procedure in evaluating the performance of a probationary employee.

Records show that Abbotts PPSE procedure mandates, inter alia, that the job performance of a probationary employee
should be formally reviewed and discussed with the employee at least twice: first on the third month and second on
the fifth month from the date of employment. Abbott is also required to come up with a Performance Improvement
Plan during the third month review to bridge the gap between the employees performance and the standards set, if any.
In addition, a signed copy of the PPSE form should be submitted to Abbotts HRD as the same would serve as basis for
recommending the confirmation or termination of the probationary employment.

In this case, it is apparent that Abbott failed to follow the above-stated procedure in evaluating Alcaraz. For one, there
lies a hiatus of evidence that a signed copy of Alcarazs PPSE form was submitted to the HRD. It was not even shown
that a PPSE form was completed to formally assess her performance. Neither was the performance evaluation
discussed with her during the third and fifth months of her employment. Nor did Abbott come up with the necessary
Performance Improvement Plan to properly gauge Alcarazs performance with the set company standards.

In this light, while there lies due cause to terminate Alcarazs probationary employment for her failure to meet the
standards required for her regularization, and while it must be further pointed out that Abbott had satisfied its statutory
duty to serve a written notice of termination, the fact that it violated its own company procedure renders the
termination of Alcarazs employment procedurally infirm, warranting the payment of nominal damages. A further
exposition is apropos. GRANTED.

a) What is meant by contractual due process?

Contractual Due Process: Due process that is agreed upon in a contract, such as in a CBA, about a particular
procedure to be followed when dismissing an employee.

MECO Manning & Crewing Services, Inc. et al vs Cuyos, GR 222939, 03 July 2019

On March 10, 2008, Cuyos filed a complaint for illegal dismissal and claims for salaries and other benefits for the
unexpired portion of his employment contract, damages, and attorney’s fees against International Crew Services, Ltd.
(ICS), and petitioners Meco Manning & Crewing Services, Inc. (MECO) and Captain Igmedio G. Sorrera (Capt.
Sorrera) before the Regional Arbitration Branch of the NLRC in Cebu City.

Constantino alleged that on December 11, 2007, MECO, for and on behalf of its principal, ICS, hired him as the
Second Marine Engineer of the vessel “M/V Crown Princess.” The employment was for a period of eight months
commencing on December 10, 2007,

Constantino claimed that the ship’s Chief Engineer, Francisco G. Vera, Jr. (Vera), mistreated him during his short stay
on board the “M/V Crown Princess.” He recounted that on December 13, 2007, Vera started shouting at him whenever
he would ask questions concerning the engine operations of the vessel; and that on January 9, 2008, he was attending
to the freshwater generator when, all of a sudden, Vera slapped his hand and kept on shouting at him allegedly
because he was not doing his work properly.

Finally, on February 14, 2008, Constantino was shocked when the Third Mate of the vessel handed to him an
electronic plane ticket and informed him that he must disembark at Cristobal, Panama, where a reliever would take his
place. After inquiring for the reason why he was suddenly being relieved, Captain G. Kolidas (Capt. Kolidas), the
Master of the Vessel, told him that he would call their head office in Greece. After the said communication, however,
Capt. Kolidas told him that it would be better for him to just go home as he did not have a good relation with Vera.
Thus, on February 18, 2008, Constantino was made to disembark from the vessel against his will. He arrived in
Manila on February 20, 2008.

On February 22, 2008, Constantino met with Capt. Sorrera at the MECO office and sought explanation for his
unceremonious and illegal dismissal. Capt. Sorrera informed him that he was dismissed because he challenged Vera to
a fight. Constantino denied the allegation and claimed that it was Vera who was very rude to him.

The Labor Arbiter ruled in favour of the employer, MECO, holding that Constantino’s dismissal is justified, to which
when he challenged the second engineer into a fist fight thereby endangering the crew of the ship as well. Such
decision was upheld by the NLRC, however it was reversed by the Court of Appeals. According to the latter, the
evidences presented by the said petitioner do not substantiate the claims as enumerated by Vera.
a) May non-compliance with the notice requirement be excused under the provisions of the POEA-SEC? NO
In this case, the petitioners admit that they did not furnish Constantino with any written notice prior to his dismissal.
They maintain, however, that this is justified under Section 17(D) of the POEA-SEC.

The contention is misplaced. Section 17 of the POEA-SEC provides for the disciplinary procedures against erring
seafarers,
Section 17(D) is inapplicable to this case because the alleged offenses by Constantino have not been established by
substantial evidence. Assuming for the sake of argument that the aforesaid infractions have been duly shown, Section
17(D) would still be inapplicable because Capt. Kolidas failed to conduct the required investigation under Section
17(B). Finally, it is clear from Section 17 that it is only the second notice or the notice of dismissal which may be
dispensed with under exceptional circumstances - the first written notice could never be dispensed with. The seafarer-
employee should always be furnished with the written notice informing him of the charges against him and the date,
time, and place of the formal investigation. Very clearly, the petitioners failed to afford Constantino with procedural
due process prior to his termination.

Whether or not Constantino was illegally dismissed. YES

The High court agreed with the findings of the CA, that the burden of proof of evidences in an illegal dismissal case is
upon the employer, so as to establish convincingly that indeed a dismissal is within a just cause, and within the
confides as allowed by law.

In the case at bar, the evidences presented are not the photocopies of the logbook, but mere facsimile of the alleged
report written by the Ship captain, as claimed by Vera, there were also inconsistencies as to the date to which such
facsimile was transmitted from the ship captain.

The court also found the facsimile message dated February 1, 2008 to be dubious and unreliable. In this facsimile
message, Capt. Kolidas stated that Constantino started creating problems against Vera since he boarded the vessel and
that Constantino even challenged Vera to a fight. For these reasons, he stated that he was of the opinion that
Constantino must be replaced as the Second Engineer as soon as possible. However, the appellate court noted that this
facsimile message was sent only on February 20, 2008 as could be shown by the electronic annotation “20/02/2008
14:41” appearing on the upper right corner of the message. This, according to the appellate court, is inconsistent with
the facts of the case considering that Constantino was already informed of his dismissal on February 14, 2008, and that
he already disembarked from the vessel on February 18, 2008. The appellate court further ruled that Vera’s January 6,
2008 letter is self-serving and uncorroborated by any evidence. As such, it cannot be given any weight and credit.

Also, Constantino’s procedural due process right was violated when he was not afforded the chance by the Ship
captain to explain the said allegations by Vera, there was no chance to verify nor inform the said individual the
violations he allegedly committed.

Gopio vs Bautista, GR 205953, 05 June 2019

a) In a fixed-term employment, may the parties stipulate in their contract on the payment of one-month
severance compensation in lieu of the prior notice required under the law on pre-termination of employment?
NO

ON MANAGEMENT PREROGATIVES AND CONSTRUCTIVE DISMISSAL

In the succeeding cases, determine the following:
a) Are there limitations to the exercise of management prerogatives?
b) Did management validly exercise its prerogatives?
c) May there be demotion even without any diminution of salaries and benefits?
d) May a reduced workload result to a cause of action for constructive dismissal?
e) May the inconvenience, disruption, difficulty or disadvantage that an employee must endure sustain a
finding of constructive dismissal?
f) What are contingency measures that management may adopt upon uncovering employee wrongdoing?

Management prerogatives
o Sagales vs Rustan’s Commercial Corp, GR 16654, 27 November 2008
In October 1970, Julito Sagales was employed by Rustan’s Commercial Corporation as chief cook in one of Rustan’s
Restaurants “Yum yum Tree Coffee Shop”. He was an excellent employee receiving numerous awards. However,
in June 2001, Sagales was caught stealing a bag of squid heads 1.355 kg worth P50.00. Apparently, Sagales was not
able to produce a receipt for the said squid heads at that time. In the same month, Sagales underwent inquest
proceedings for qualified theft in the local fiscal’s office. In the said proceeding, Sagales was able to produce the
receipt for the said squid heads. He failed to immediately show the purchase receipt when he was accosted
because he misplaced it when he changed his clothes. He also averred that the squid heads are actually scraps of the
restaurant and are not fit to be served to customers; so if indeed he really wanted to steal and profit, he would have
stolen better quality squid heads. The fiscal dismissed the case against Sagales for lack of evidence.
Notwithstanding the dismissal, Rustans required Sagales to explain in writing within 48 hrs why he should not be
terminated and even placed petitioner under preventive suspension.

But at the end of the same month, the legal division of Rustan conducted its own investigation where Sagales and
his lawyer appeared. The security guards testified against Sagales. As well as the chief cashier also testified that the
squid heads were unpaid. In July 2001, after investigation by Rustan, Sagales was terminated.

Whether or not Sagales’s termination is valid.

Did the management validly exercise its prerogatives?
NO
The penalty of dismissal is too harsh under the circumstances.
The free will of management to conduct its own business affairs to achieve its purpose cannot be denied. The only
condition is that the exercise of management prerogatives should not be done in bad faith or with abuse of discretion.
while the employer has the inherent right to discipline, including that of dismissing its employees, this prerogative is
subject to the regulation by the State in the exercise of its police power. In this regard, it is a hornbook doctrine that
infractions committed by an employee should merit only the corresponding penalty demanded by the
circumstance. The penalty must be commensurate with the act, conduct or omission imputed to the employee
and must be imposed in connection with the disciplinary authority of the employer.
(before a party may seek the intervention of the court, he should first avail himself of all the means
afforded him by administrative processes)
In the case at bar, petitioner deserves compassion more than condemnation. At the end of the day, it is undisputed that:
(1) petitioner has worked for respondent for almost thirty-one (31) years;
(3) his tireless and faithful service is attested by the numerous awards he has received from respondent;
(4) the incident on June 18, 2001 was his first offense in his long years of service;
(5) the value of the squid heads worth P50.00 is negligible;
(6) respondent practically did not lose anything as the squid heads were considered scrap goods and usually thrown
away in the wastebasket;
(7) the ignominy and shame undergone by petitioner in being imprisoned, however momentary, is punishment in
itself;
(8) petitioner was preventively suspended for one month, which is already a commensurate punishment for the
infraction committed.
Truly, petitioner has more than paid his due.
The nature of private respondent's position as assistant cook shows that his position is that of trust and confidence.
As assistant cook in his memorandum, private respondent is charged with the care of food preparation in the hotel's
coffee shop. He is also responsible for the custody of food supplies and must see to it that there is sufficient stock in
the hotel kitchen. He should not permit food or other materials to be taken out from the kitchen without the necessary
order slip or authorization as these are properties of the hotel. Thus, the nature of private respondent's position as
assistant cook places upon him the duty of care and custody of Concorde's property.
Of course, the ruling assumes greater significance if petitioner is the chief cook. A chief cook naturally performs greater
functions and has more responsibilities than an assistant cook. In eo quod plus sit simper inest et minimus. The greater
always includes the less. Ang malawak ay laging sumasakop sa maliit.

Nevertheless, it is useless to reinstate Sagales because he should have been retired already at the time of this
decision. So instead of reinstatement, Sagales was awarded separation pay computed at one-month salary for
every year of service; backwages were also awarded.
The Supreme Court also emphasized: the right of every employee to security of tenure is all the more secured by the
Labor Code by providing that “the employer shall not terminate the services of an employee except for a just cause or
when authorized” by law. However, the employer, in exercising its right to terminate employees for just and
authorized causes must impose a penalty commensurate with the act, conduct, or omission imputed to the employee

The quantum of proof required for the application of the loss of trust and confidence rule is not proof beyond
reasonable doubt.
It is sufficient that there must only be some basis for the loss of trust and confidence or that there is reasonable ground
to believe, if not to entertain the moral conviction, that the employee concerned is responsible for the misconduct and
that his participation in the misconduct rendered him absolutely unworthy of trust and confidence.

The penalty of dismissal is too harsh under the circumstances. The free will of management to conduct its own
business affairs to achieve its purpose cannot be denied. The only condition is that the exercise of management
prerogatives should not be done in bad faith or with abuse of discretion. Truly, while the employer has the inherent
right to discipline, including that of dismissing its employees, this prerogative is subject to the regulation by the State
in the exercise of its police power. In this regard, it is a hornbook doctrine that infractions committed by an employee
should merit only the corresponding penalty demanded by the circumstance. The penalty must be commensurate with
the act, conduct or omission imputed to the employee and must be imposed in connection with the disciplinary
authority of the employer. We do not condone dishonesty. After all, honesty is the best policy. However, punishment
should be commensurate with the offense committed. The supreme penalty of dismissal is the death penalty to the
working man. Thus, care should be exercised by employers in imposing dismissal to erring employees. The penalty of
dismissal should be availed of as a last resort.

Are there limitations to the exercise of management prerogatives?

Yes, it should not be done in bad faith or with abuse of discretion.

Did management validly exercise its prerogatives?

The NLRC further ruled that petitioner was illegally dismissed as respondent failed to establish a just cause for
dismissal.

Facts: Petitioner Julito Sagales was employed by respondent Rustan’s Commercial Corporation from October 1970
until July 26, 2001, when he was terminated. At the time of his dismissal, he was occupying the position of Chief
Cook at the Yum Yum Tree Coffee Shop. He was paid a basic monthly salary of P9,880.00. He was also receiving
service charge of not less than P3,000.00 a month and other benefits under the law and the existing collective
bargaining agreement between respondent and his labor union. In the course of his employment, petitioner was a
consistent recipient of numerous citations for his performance. After receiving his latest award on March 27, 2001,
petitioner conveyed to respondent his intention of retiring on October 31, 2001, after reaching thirty-one (31) years in
service. Petitioner, however, was not allowed to retire with his honor intacts. On June 18, 2001, Security Guard Waldo
Magtangob, upon instructions from Senior Guard Bonifacio Aranas, apprehended petitioner in the act of taking out
from Rustan’s Supermarket a plastic bag. Upon examination, it was discovered that the plastic bag contained 1.335
kilos of squid heads worth P50.00. Petitioner was not able to show any receipt when confronted. Thus, he was brought
to the Security Office of respondent corporation for proper endorsement to the Makati Headquarters of the Philippine
National Police. Subsequently, petitioner was brought to the Makati Police Criminal Investigation Division where he
was detained. Petitioner was later ordered released pending further investigation. On June 19, 2001, petitioner
underwent inquest proceedings for qualified theft before Assistant Prosecutor Amado Y. Pineda. Although petitioner
admitted that he was in possession of the plastic bag containing the squid heads, he denied stealing them because he
actually paid for them. As proof, petitioner presented a receipt. The only fault he committed was his failure to
immediately show the purchase receipt when he was accosted because he misplaced it when he changed his clothes.
He also alleged that the squid heads were already “scraps” as these were not intended for cooking. Neither were the
squid heads served to customers. He bought the squid heads so that they could be eaten instead of being thrown away.
If he intended tosteal from respondent, he could have stolen other valuable items instead of scrap. Assistant Prosecutor
Pineda believed the version of petitioner and recommended the dismissal of the case for “lack of evidence.” The
recommendation was approved upon review by the City Prosecutor. Notwithstanding the dismissal of the complaint,
respondent, on June 25, 2001, required petitioner to explain in writing within forty-eight (48) hours why he should not
be terminated in view of the June 18, 2001 incident. Respondent also placed petitioner under preventive suspension.
Respondent did not find merit in the explanation of petitioner. Thus, petitioner was dismissed from service on July 26,
2001. At that time, petitioner had been under preventive suspension for one (1) month. Aggrieved, petitioner filed a
complaint for illegal dismissal against respondent. He also prayed for unpaid salaries/wages, overtime pay, as well as
moral and exemplary damages, attorney’s fees, and service charges.

Issues: (1) Is the evidence on record sufficient to conclude that petitioner committed the crime charged?
and (2) Assuming that the answer is in the affirmative, is the penalty of dismissal proper?

Held: 1. YES. The evidence on record is sufficient to conclude that petitioner committed the crime charged. Security
of tenure is a paramount right of every employee that is held sacred by the Constitution. The reason for this is that
labor is deemed to be “property” within the meaning of constitutional guarantees. Indeed, as it is the policy of the
State to guarantee the right of every worker to security of tenure as an act of social justice, such right should not be
denied on mere speculation of any similar or unclear nebulous basis. Indeed, the right of every employee to security of
tenure is all the more secured by the Labor Code by providing that “the employer shall not terminate the services of an
employee except for a just cause or when authorized” by law. Otherwise, an employee who is illegally dismissed
“shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages,
inclusive of allowances, and to his other benefits or their monetary equivalent computed from the time his
compensation was withheld from him up to the time of his actual reinstatement.” Necessarily then, the employer bears
the burden of proof to show the basis of the termination of the employee. In the case at bar, respondent has discharged
its onus of proving that petitioner committed the crime charged. We stress that the quantum of proof required for the
application of the loss of trust and confidence rule is not proof beyond reasonable doubt. It is sufficient that there must
only be some basis for the loss of trust and confidence or that there is reasonable ground to believe, if not to entertain
the moral conviction, that the employee concerned is responsible for the misconduct and that his participation in the
misconduct rendered him absolutely unworthy of trust and confidence. It is also of no moment that the criminal
complaint for qualified theft against petitioner was dismissed. It is well settled that the conviction of an employee in a
criminal case is not indispensable to the exercise of the employer’s disciplinary authority.
2. NO. The penalty of dismissal is too harsh under the circumstances. The free will of management to conduct its own
business affairs to achieve its purpose cannot be denied. The only condition is that the exercise of management
prerogatives should not be done in bad faith or with abuse of discretion. Truly, while the employer has the inherent
right to discipline, including that of dismissing its employees, this prerogative is subject to the regulation by the State
in the exercise of its police power. In this regard, it is a hornbook doctrine that infractions committed by an employee
should merit only the corresponding penalty demanded by the circumstance. The penalty must be commensurate with
the act, conduct or omission imputed to the employee and must be imposed in connection with the disciplinary
authority of the employer. We do not condone dishonesty. After all, honesty is the best policy. However, punishment
should be commensurate with the offense committed. The supreme penalty of dismissal is the death penalty to the
working man. Thus, care should be exercised by employers in imposing dismissal to erring employees. The penalty of
dismissal should be availed of as a last resort

o Jimmy Areno, Jr. vs Skycable PCC-Baguio, GR No. 180302, 05 February 2010

l On January 17, 1995, petitioner was employed as a cable technician by respondent Skycable PCC-Baguio.
l On January 17, 2002, an accounting clerk of respondent, (Soriano), sent to the human resource manager a letter-
complaint against petitioner alleging that on two separate occasions, the latter spread false rumors about her (the
first in the middle of 2001 and the second on December 22, 2001).On January 27, 2002, she was again insulted by
petitioner when the latter approached her and said that she was seen going out with Aldrin Estrada, their field
service supervisor, at Central Park, Baguio City. During that incident, petitioner uttered, Ikaw lang ang
nakakaalam ng totoo with malicious intent and in a provocative manner.
l Soriano averred that petitioners unscrupulous behavior constituted serious and grave offense in violation of the
companys Code of Discipline.
l On the same day, respondent issued a Memorandum requiring petitioner to submit an explanation within 76 hours
from notice thereof. Petitioner submitted his written explanation dated January 23, 2002 denying all the
allegations in Sorianos letter-complaint and further denying having uttered the statement imputed on him.
l An administrative investigation was accordingly conducted on January 31, 2002. In a Memo dated February 6,
2002, the investigating committee found petitioner guilty of having made malicious statements against Soriano
during the January 7, 2002 conversation, which is categorized as an offense under the Company Code of
Discipline. Consequently, petitioner was suspended for three days without pay effective February 13-15, 2002.
The Memo was allegedly served on February 7, 2002 but petitioner refused to sign it.
l Notwithstanding the suspension order, however, petitioner still reported for work on February 13, 2002. By
reason thereof, respondent sent petitioner a letter denominated as 1st Notice of Termination requiring him to
explain in writing why he should not be terminated for insubordination. On February 18, 2002, petitioner inquired
from respondent whether he is already dismissed or merely suspended since he was refused entry into the
 company premises on February 14, 2002. Respondent replied that petitioner was merely suspended and gave him
additional time to tender his written explanation to the 1st Notice of Termination.
l Anent the new charge of insubordination, petitioner submitted to respondent his written explanation averring that
he still reported for work on the first day of his suspension because the accusation of Soriano is baseless and her
testimony is hearsay. Besides, according to petitioner, he did not defy any order related to his duties, no
representative of the management prevented him from working and that reporting to work without being paid for
the service he rendered on that day did not in any way affect the companys productivity.
On March 15, 2002, an investigation on the insubordination case was conducted which was attended by the parties and
their respective counsels. Through a Final Notice of Termination dated April 1, 2002, petitioner was dismissed from
service on the ground of insubordination or willful disobedience in complying with the suspension order.

WON suspension was valid despite the fact that the testimony of Soriano is hearsay? YES
Ø the 3-day suspension of petitioner is not tainted with substantive or procedural infirmities. For one, petitioners
insistent claim that his suspension was predicated on hearsay testimony deserves scant consideration.
Ø The NLRC initially ruled that Sorianos testimony during the investigation on the alleged act of petitioner in
spreading rumors is hearsay.Nevertheless, it reversed itself by holding that while Soriano stated that her
allegation with regard to the first two instances that petitioner was spreading false information about her is based
on what she heard from other people, her narration of the third instance relating to what has transpired during
their January 7, 2002 conversation is not hearsay.
Ø The CA and NLRC are in agreement with this finding and since both are supported by evidence on record, the
same must be accorded due respect and finality.
Ø The decision to suspend petitioner was rendered after investigation and a finding by respondent that petitioner has
indeed made malicious statements against a co-employee. The suspension was imposed due to a repeated
infraction within a deactivation period set by the company relating to a previous similar offense committed. It is
axiomatic that appropriate disciplinary sanction is within the purview of management imposition. What should
not be overlooked is the prerogative of an employer company to prescribe reasonable rules and regulations
necessary for the proper conduct of its business and to provide certain disciplinary measures in order to
implement said rules to assure that the same would be complied with. Respondent then acted within its rights as
an employer when it decided to exercise its management prerogative to impose disciplinary measure on its erring
employee.
Ø Petitioner was validly dismissed on the ground of willful disobedience in refusing to comply with the suspension
order.
Ø One of the just causes for dismissal of an employee under art. 282 is willful disobedience.

(1) the employees assailed conduct must have been willful, i.e., 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 had been engaged to discharge.
Ø Both requisites are present in the instant case. It is noteworthy that upon receipt of the notice of suspension,
petitioner did not question such order at the first instance. He immediately defied the order by reporting on the
first day of his suspension. Deliberate disregard or disobedience of rules by the employee cannot be
countenanced. It may encourage him to do even worse and will render a mockery of the rules of discipline that
employees are required to observe.
Ø Petitioner was served the first notice of termination and was given time to submit his written explanation. A
hearing was conducted wherein both parties with their respective counsels were present. After finding cause for
petitioners termination, a final notice apprising him of the decision to terminate his employment was served. All
things considered, respondent validly dismissed petitioner for cause after complying with the procedural
requirements of the law.

o Philippine Span Asia Carriers (Formerly Sulpicio Lines, Inc.) vs Heidi Pelayo, GR No. 212003, 28 February
2018
Ø Pelayo was employed by Sulpicio Lines as an accounting clerk at its Davao City branch office.
o As accounting clerk, her main duties were "to receive statements and billings for processing of
payments, prepare vouchers and checks for the approval and signature of the branch manager, and
release checks for payment."
Ø Sulpicio Lines uncovered several anomalous transactions in its Davao City branch office.
o Most notably, a check issued to a certain "J. Josol" had been altered from its original amount of
P20,804.58 to P820,804.58.
o The signatories to the check were branch manager Tirso Tan (Tan) and cashier Fely Sobiaco
(Sobiaco).
 o There were also apparent double disbursements.
§ In the first double disbursement, two (2) checks amounting to P5,312.15 each were issued
for a single P5,312.15 transaction with Davao United Educational Supplies.
• This transaction was covered by official receipt no. 16527, in the amount of
P5,312.15 and dated January 12, 2008.
§ Two (2) checks for P20,804.58 each in favor of Everstrong Enterprises were covered by
official receipt no. 5129, dated January 25, 2008.
o Another apparent anomaly was a discrepancy in the amounts reflected in what should have been
a voucher and a check corresponding to each other and covering the same transaction with ARR
Vulcanizing.
Ø Sulpicio Lines' Cebu-based management team went to Davao to investigate from March 3 to 5, 2010.
Ø Pelayo was interviewed by members of the management team as "she was the one who personally prepared the
cash vouchers and checks for approval by Tan and Sobiaco.”
• On March 8, 2010, Pelayo was asked to come to Sulpicio Lines' Cebu main office for another interview.
o In the midst of a panel interview, Pelayo walked out.
o She later claimed that she was being coerced to admit complicity with Tan and Sobiaco
Ø Pelayo then returned to Davao City, where she was admitted to a hospital "because of depression and a nervous
breakdown."She eventually filed for leave of absence and ultimately stopped reporting for work.
• Sulpicio Lines served on Pelayo a memorandum requiring her to submit a written explanation concerning
double disbursements
o Sulpicio Lines also placed Pelayo on preventive suspension for 30 days.
o Sulpicio Lines also sought the assistance of the National Bureau of Investigation, which asked Pelayo to appear
before it on March 19, 2010.
• Instead of responding to Sulpicio Lines' memorandum or appearing before the National Bureau of
Investigation, Pelayo filed a Complaint against Sulpicio Lines charging it with constructive dismissal.
• LA: held that Sulpicio Lines constructively dismissed Pelayo.
o LA faulted Sulpicio Lines for harassing Pelayo when her participation in the uncovered
anomalies was "far-fetched."
o Labor Arbiter Larida relied mainly on the affidavit of Alex Te (Te), an employee of Sulpicio
Lines assigned at the Accounting Department of its Cebu City main office.
o Labor Arbiter Larida noted that the affidavit's silence on how Pelayo could have been involved
demonstrated that it was unjust to suspect her of wrongdoing.
• NLRC: reversed Labor Arbiter Larida's Decision.
o It explained that the matter of disciplining employees was a management prerogative and that
complainant's involvement in the investigation did not necessarily amount to harassment.
• CA: found grave abuse of discretion on the part of the National Labor Relations Commission in
reversing Labor Arbiter Larida's Decision.

W/N there was constructive dismissal – NO

• An employer who conducts investigations following the discovery of misdeeds by its employees is not
being abusive when it seeks information from an employee involved in the workflow which occasioned
the misdeed.
• An employee's involvement in such an investigation will naturally entail difficulty. This difficulty
does not mean that the employer is creating an inhospitable employment atmosphere so as to ease out
the employee involved in the investigation.
• While adopted with a view "to give maximum aid and protection to labor," labor laws are not to
be applied in a manner that undermines valid exercise of management prerogative.
• Disciplining employees does not only entail the demarcation of permissible and impermissible conduct
through company rules and regulations, and the imposition of appropriate sanctions. It also involves
intervening mechanisms "to assure that [employers' rules] would be complied with."
o While due process is imperative in the discipline of employees, our laws do not go so far as to
mandate the minutiae of how employers must actually investigate employees' wrongdoings.
 o Employers are free to adopt different mechanisms such as interviews, written statements,
or probes by specially designated panels of officers.
• ITC, there is no objective proof demonstrating how the interview in Cebu actually proceeded.
o Other than respondent's bare allegation, there is nothing to support the claim that her interviewers
were hostile, distrusting, and censorious, or that the interview was a mere pretext to pin her down.
• Respondent's subsequent hospitalization does not prove harassment or coercion to make an admission
either.
o The mere fact of its occurrence is not an attestation that respondent's interview proceeded in the
manner that she claimed it did.
o Different individuals react to stress differently "and some people react to stress by getting sick."
o Evidence does not lead to an inescapable conclusion that respondent's confinement was
solely and exclusively because of how respondent claims her interviewers incriminated her.

o International Elevator & Equipment Employees Union(IEEEU) vs International Elevator & Equipment, Inc.
(IEEI), GR No. 238310, 19 January 2021
Ø International Elevator & Equipment, Inc. (respondent) is a domestic corporation engaged in the business of
elevator and equipment supply and installation, while petitioner is a legitimate labor organization and the
incumbent bargaining agent of the rank and file employees of respondent. In 2014, the parties entered into a
collective bargaining agreement (CBA)
Ø On January 9, 2016, respondent issued an inter-office memorandum on tardiness
Ø Petitioner objected to the issuance of the aforequoted Tardiness Memo and asserted that said memo drastically
changed the company's prevailing policies on attendance and tardiness. The matter was taken up in the grievance
machinery, but to no avail.
Ø Petitioner averred that the subject memo violates the CBA provision on vacation leave. By charging the penalty
for tardiness as a half day leave against the vacation leaves of the employee, the Tardiness Memo limits and
diminishes the employees' enjoyment of the CBA-provided vacation leaves and, in effect, alters the parties' CBA.
Ø respondent maintained that the issuance of the Tardiness Memo was a valid exercise of its management
prerogative to ensure that employees arrive at work on time and to impose penalties for tardiness. Respondent
asserted that the Tardiness Memo was not oppressive as it even allowed a 15-minute grace period before the
penalty for tardiness is imposed. Neither was the issuance of the subject memo a violation of the CBA.

the issuance of memo of tardiness is a valid management prerogative. YES

The issuance of the subject Tardiness Memo was a valid exercise of respondent's management prerogative.
The right of an employer to regulate all aspects of employment, aptly called "management prerogative," gives
employers the freedom to regulate, according to their discretion and best judgment, all aspects of employment

In this light, courts often decline to interfere in legitimate business decisions of employers. In fact, labor laws
discourage interference in employers' judgment concerning the conduct of their business.

Here, respondent's management prerogative was recognized and reinforced by no less than the parties' CBA,
Indeed, among the employer's management prerogatives is the right to prescribe reasonable rules and regulations
necessary or proper for the conduct of its business or concern, to provide certain disciplinary measures to implement
said rules and to assure that the same would be complied with. Corollarily, the grant of vacation leave privileges to an
employee is also a prerogative of the employer It is not a standard of law but a mere concession or act of grace of the
employer. Thus, it is well within the power and authority of an employer to impose certain conditions, as it deems fit,
on the grant of vacation leaves, such as having the option to schedule the same,39 or even to compel the employees to
exhaust all their vacation leave credits.

o Telus International Philippines, Inc. et al vs Harvey de Guzman, GR 202676, 04 December 2019

FACTS:
Ø Telus asserted that it first hired respondent (De Guzman) sometime in September 2004 as Inbound Sales
Associate. His last post prior to the controversy was Senior Quality Analyst for DELL After Point of Sale (DELL,
APoS).
Ø On August 2, 2008, Telus received an escalation complaint from (Flores), Team Captain of DELL APoS,
charging De Guzman of disrespect and ridicule towards a person.
Ø Acting on the complaint of Flores, Telus issued a Due Process form to De Guzman in violation of Section 2,
Disorderly Conduct, Items 60 and 61 of Telus’ Code of Conduct. De Guzman was placed on preventive
 suspension and was directed to submit a written explanation to answer the charges to which De Guzman
complied.
Ø After the administrative hearing, De Guzman’s preventive suspension was lifted after finding De Guzman
innocent of the offenses charged. However, Telus decided to transfer De Guzman to another “practice”.
Ø On August 21, 2008, a day after his transfer was confirmed, De Guzman file for vacation leave until September
26, 2008. De Guzman was then scheduled for profile interviews twice but he failed to show up. Telus sent De
Guzman a Return to Work Order dated October 13, 2008. Later on, Telus found out that as early as September
15, 2008, De Guzman already filed a complaint for constructive dismissal with monetary claims before the NLRC
notwithstanding that he was still on paid vacation leave and was receiving all benefits during the said period. Due
to De Guzman’s refusal to return to work, he was then placed on floating status. The Labor Arbiter found Telus
guilty of constructively dismissing De Guzman. NLRC, however, overturned the ruling of Labor Arbiter. On
appeal, the CA affirmed the ruling of the Labor Arbiter and overturned the decision of NLRC.

Was De Guzman constructively dismissed? YES

Ø The series of acts by the company seriously flouted De Guzman's right as a tenured employee.
Ø The series of actions done by Telus manifests that De Guzman was terminated in disguise and such actions
amount to constructive dismissal. The conclusion is all too clear that Telus fostered a working environment that
was hostile, discriminatory, unreasonable, and inequitable that naturally compelled De Guzman to give up his
employment thereat to avoid the difficulties he had to face just to keep his employment.
Ø The actions of Telus show that De Guzman was actually subsequently penalized with a much graver consequence
than the supposed preventive suspension that he had undergone. at all,
Ø Telus conveniently used "management prerogative" to mask its adverse actions and washed its hands by
conveniently claiming that it timely lifted the preventive suspension of De Guzman. It should be noted that a
mere desire to reinstate an employee to his/her former position does not satisfy the requirement of the law. Such
cannot amount to substantial compliance on the part of the employer nor will it effectively negate the idea that the
employee was not being dismissed after the period of preventive suspension.
Ø As to the validity of transfer and floating status vis-á-vis management prerogative, while it maybe argued that the
nature of the call center business is such that it is subject to seasonal peaks and troughs because of client pullouts,
changes in clients' requirements and demands, and a myriad other factors, still, the necessity to transfer De
Guzman to another practice/account does not depend on Telus' third party client/contracts. When the controversy
arose, Telus had several clients in its roster to which it can easily assign De Guzman as Quality Analyst without
any hindrance. Telus did not provide any valid justification or presented proof that there was indeed a deficit of
account that bars the immediate transfer of De Guzman or that the company was sustaining losses that would
justify placing De Guzman on floating status. Hence, the unwarranted acts of Telus evidently constitute proof of
the constructive dismissal of De Guzman. To say that Telus merely exercised its rights and that any
inconvenience or injury that De Guzman may have suffered resulted merely in damnum absque injuria which
cannot legally give rise to a cause of action for constructive dismissal, is abhorrent considering the fact that his
being placed on a "floating status" without valid reasons violated his security of tenure and resulted in
unfavourable economic consequences to De Guzman.

o Isabela-I Electric Coop, Inc. vs Vicente del Rosario, Jr. GR No. 226369, 17 July 2019
Ø ON OCT. 29, 1996, petitioner Isabela-I Electric Cooperative Inc. hired respondent Vicente B. Del Rosario Jr. as
financial assistant. On Oct. 26, 1996, he was promoted to management internal auditor at petitioner’s main office.
Ø In January 2011, petitioner approved a reorganization plan declaring all positions in the company vacant. Under
the new setup, respondent was given the new position of area operations manager.
Ø In a complaint for illegal dismissal and damages, respondent alleged among others, that he suffered a diminution
in pay in his new position. Petitioner denied this allegation.

Was respondent constructively dismissed when he got appointed to the new position of Area Operations
Management Department Manager in lieu of his former position as Management Internal Auditor? YES

Ø Vicente B. Del Rosario, Jr. is declared to have been illegally transferred and/or demoted. Isabela-1 Electric
Coop., Inc. is ordered to immediately reinstate and/or restore the Vicente B. Del Rosario, Jr. to his former
position as Management Internal Auditor
Ø Records show that management internal auditor carries salary rank 20, while the position of an area operations
head is salary rank 19.
Ø On this score, petitioner asserts that respondent is basically receiving the same amount of salary at P30,963.95,
and therefore, there is no diminution in salary to speak of.
Ø The evidence, however, would suggest that after the reorganization, there was restructuring of the salary ranks.
Salary rank 20 is paid P33,038.53,44 while the compensation for salary rank 19 is fixed at P30,963.95.
Ø Hence, had petitioner been retained as management internal auditor, he would already have received P33,038.53,
and not just P30,963.95.
Ø In any case, even if there was no diminution in salary, there has still been a demotion in terms of respondent’s
rank, responsibilities and status. There is demotion when an employee is appointed to a position resulting to a
diminution in duties, responsibilities, status or rank which may or may not involve a reduction in salary.
Ø As for respondent’s monetary awards, we deem it proper to grant salary differential. As correctly held by the
NLRC, Article 279 of the Labor Code provides that an employee who is unjustly dismissed from employment
shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages,
inclusive of allowances and other benefits or their monetary equivalent computed from the time his compensation
was withheld from him up to his actual reinstatement.

o Automatic Appliances, Inc. et al vs Francia Deguidoy, GR No. 228088, 04 December 2019

Ø AAI is a corporation organized and existing under the laws of the Philippines. Petitioners Lim, Buenaventura and
Pontillas are the former President, Vice President for Human Resource and Tutuban Branch Manager respectively
of the said corporation.
Ø On June 3, 1988 AAI hired Deguidoy as a regular sales coordinator in its cubao Branch. As a sales coordinator
she was tasked with selling merchandise and was required to maintain branch sales quota.
Ø In 2013, AAI suffered decline in its sales and experienced economic difficulties. March 6, 2013, it implemented
cost cutting measures, which includes closing some of its branches.
Ø AAI issued a memorandum dated july 1, 2013, informing its employees of their re-shuffling and re-assignment to
AAI’s various brances. As a result deguidoy was re-assigned from the Cubao Branch to the Tutuban Branch. She
accepted her re-assignment. She failed to reach her sales quota, worse the Brance Attendance Time Log report
showed that she incurred 29 days of unexplained absnces from March to August 2013. While her co-employees
surpassed their sales quotas,while she performed at the exact opposite. AAI received a letter from the Tutuban
Branch Pontillas, notifying the management about the additional sales personnel at the Tututban branch.
Ø Upon hearing the deficiencies of Deguidoy, AAI issued attendance infraction memo of Inefficiency and gross
negligence. Deguido was placed under one month suspension. She accepted and apologized for her faults. On
October 7, 2013, she reported back to work, but AAI verbally informed her of an intended transfer to its Ortigas
branc, Dismayed Deguidoy left during her lunch break, and never returned. On October 11, 2013, AAI sent
Deguidoy a letter requiring her to explain her failure to report for work. Deguidoy ignored the said letter twice.
Still the same was unheeded. Unknown to AAI, Deguidoy filed a case for illegal dismissal with money claims
and 13th month claims.

WHETHER OR NOT DEGUIDOY IS CONSTRUCTIVELY DISMISSED? NO

Ø The Court held that Deguidoy is not constructively dismissed. For such to exists where there is a cessation of
work, because continued employment is rendered impossible, unreasonable or unlikely, as an offer involving a
demotion in rank or a diminuation in pay and other benefits. It is amounting to such, when the employer commits
an act of clear discrimination, insensibility or disdain that employment becomes so unbearable on the part of the
employees and leave him or her to forego his or her continued employment.
Ø In the Case, It is reiterated that transfer of an employment and designation of tasks is management prerogative,
unless there is clear cut discrimination or intended to make an employee unable to perform of her function due to
her transfer, or is a diminuation of benefits, then management prerogative principle should not be set aside. As
the court found out that, The said transfer to the Ortigas Branch is an exercise of Management Prerogative to
cater the Ortigas Branch and not to discriminate or punish Deguinoy.
Ø , it was actually Deguidoy who continuously and contumaciously refused to abide by the notices and orders sent
by AAI.

o Republic vs Pacheo, GR 178021, 25 January 2012

Ø Pacheo was a Revenue Attorney IV, Assistant Chief of the Legal Division of the Bureau of Internal
Revenue(BIR) in Revenue Region No. 7 (RR7), Quezon City. The BIR issued Revenue Travel Assignment Order
(RTAO)No. 25-2002, ordering the reassignment of Pacheo as Assistant Chief, Legal Division from RR7 in
Quezon City to RR4 in San Fernando, Pampanga.
Ø Pacheo questioned the reassignment through her Letter addressed to Rene G. Banez, then Commissioner of
Internal Revenue (CIR). She considered her transfer from Quezon City to Pampanga as amounting to a
constructive dismissal.
Ø Due to the then inaction of the BIR, Pacheo filed a complaint before the CSC- National Capital Region (CSC-
NCR), praying for the nullification of RTAO No. 25-2002. The BIR, through its Deputy Commissioner for Legal
and Inspection Group, Edmundo P. Guevara (Guevara), denied Pacheos protest for lack of merit. It contended
that her reassignment could not be considered constructive dismissal as she maintained her position as Revenue
Attorney IV and was designated as Assistant Chief of Legal Division.
Ø Pacheo appealed to the CSC where the latter granted the same. However, the CSC held that rules and so holds
that the withholding by the BIR of her salaries is justified as she is not entitled thereto since she is deemed not to
have performed any actual work in the government on the principle of no work no pay. Still not satisfied, Pacheo
moved for reconsideration. She argued that the CSC erred in not finding that she was constructively dismissed
and, therefore, entitled to back salary. However, the motion was dismissed.

Whether or not Pacheo was constructively dismissed and entitled to backwages. YES

Ø transfer or assignment of personnel cannot be done when the same is a preliminary step toward his
removal or a scheme to lure him away from his permanent position.
Ø While a temporary transfer or assignment of personnel is permissible even without the employee's prior consent,
it cannot be done when the transfer is a preliminary step toward his removal, or a scheme to lure him away from
his permanent position, or when it is designed to indirectly terminate his service, or force his resignation. Such a
transfer would in effect circumvent the provision which safeguards the tenure of office of those who are in the
Civil Service.
Ø Significantly, Section 6, Rule III of CSC Memorandum Circular No. 40, series of 1998, defines constructive
dismissal as a situation when an employee quits his work because of the agency heads unreasonable, humiliating,
or demeaning actuations which render continued work impossible. Hence, the employee is deemed to have been
illegally dismissed. This may occur although there is no diminution or reduction of salary of the employee. It may
be a transfer from one position of dignity to a more servile or menial job.
Ø The CSC, through the OSG, contends that the deliberate refusal of Pacheo to report for work either in her original
station in Quezon City or her new place of assignment in San Fernando, Pampanga negates her claim of
constructive dismissal.
Ø It is clear, however, from E.O. 292, Book V, Title 1, Subtitle A, Chapter 5, Section 26 (7) that there is no such
duty to first report to the new place of assignment prior to questioning an alleged invalid reassignment imposed
upon an employee. Pacheo was well within her right not to report immediately to RR4, San Fernando, Pampanga,
and to question her reassignment.
Ø Reassignments involving a reduction in rank, status or salary violate an employees security of tenure, which is
assured by the Constitution, the Administrative Code of 1987, and the Omnibus Civil Service Rules and
Regulations. Organizational, within din. Having ruled that Pacheo was constructively dismissed, is she entitled to
reinstatement and back wages? The Court agrees with the CA that she is entitled to reinstatement, but finds Itself
unable to sustain the ruling that she is entitled to full back wages and benefits. It is a settled jurisprudence that an
illegally dismissed civil service employee is entitled to back salaries but limited only to a maximum period of five
(5) years, and not full back salaries from his illegal dismissal up to his reinstatement.
Ø Detail:
Ø Small salaried: division chief or below

o Alaska Milk Corp vs Paez, GR Nos. 237277 & 237317, 27 November 2019

Facts:
Ø Respondents Ruben P. Paez, et al. worked as production helpers at the Alaska’s San Pedro Laguna Milk
Manufacturing Plant. All of them were originally members of Asiapro until respondents Bate, Combite and
Oliver transferred to 5S Manpower Services (5S) on June 26, 2013.
Ø Through several Joint Operating Agreements, Asiapro and 5S undertook to provide Alaska with personnel who
would perform “auxiliary functions” at the San Pedro Plant.
Ø On different dates in 2013, the respondents were informed through separate memoranda that their respective
assignments at Alaska were to be terminated later that year. The respondents filed with the Labor Arbiter separate
complaints for illegal dismissal, regularization, and payment of money claims.
Ø LA Ruling No illegal dismissal. Asiapro and 5S had the capacity to carry on an independent business, and that the
cooperatives exercised control over the respondents through coordinators assigned at the premises of Alaska.
NLRC Ruling Affirmed LA’s ruling. CA Ruling Respondents were illegally dismissed. Asiapro and 5S were
 merely engaged in labor-only contracting. Therefore, respondents were regular employees of Alaska, and thus
were illegally dismissed.

Whether or not the respondents were illegally dismissed.

Ø Respondents Paez and Medrano, who were members of the cooperative Asiapro, were not illegally dismissed,
while respondents Bate, Combite and Oliver, who were members of the cooperative 5S, were illegally dismissed.
Ø Asiapro is a legitimate job contractor. It carried on its own independent business, has a substantial capital,
provided services to a noteworthy clientele, and exercised control over respondents Medrano and Paez as shown
by the following acts:
1. Asiapro conducted training or seminars to enhance respondents Paez’s and Medrano’s productivity
2. Respondents Paez and Medrano met with Asiapro representatives to discuss new client principal
3. Asiapro’s Project Coordinator was stationed at the Alaska plant to supervise the manner and methods utilized
by its worker members in fulfilling their duties
4. Asiapro’s control over the respondents was stipulated in the Joint Operating Agreements.

Ø In job contracting, the contractor carries out a business distinct and independent from the principal’s and
undertakes the work or service on its own account, using its own manner and methods in doing so. The
contractor’s employees are free from the control of the principal employer, save only as to the result thereof.
Therefore, Paez and Medrano were not regular employees of Alaska, and thus were not illegally dismissed.

Ø On the other hand, 5S was only engaged in labor-only contracting.

Ø Art. 106 of the Labor Code, defines labor-only contracting as an arrangement where a person without substantial
capital or investment in the form of tools, equipment, machinery, or work premises, among other things, supplies
workers to an employer, and such workers perform activities directly related to the principal business of the latter.
In agreements of this nature, the contractor merely acts as an agent in recruiting workers on account of the
principal with the intent to circumvent the constitutional and statutory rights of employees.
Ø There is no question that the practice is inimical to the national interest and that it runs contrary to public policy.
As such, it is proscribed by law. 5S only has 5 regular employees, does not own any tools, machinery, or
equipment that its worker-members can use in the performance their duties, has no independent business and has
no substantial capital. While the labor tribunals believed that 5S had adequate amount of assets, it was never
established that the contractor furnished its worker members with tools or equipment necessary to carry out the
services of a production helper at Alaska’s Milk Manufacturing Plant. It is uncontroverted that respondents Bate,
Combite, and Oliver were terminated from Alaska due to the expiration of their contracts with 5S, through which
they were assigned to render services at the San Pedro plant. However, because of the finding that 5S was
engaged in labor-only contracting, they are by fiction of law, considered as Alaska’s regular employees. Hence,
having been terminated without lawful cause, they are entitled to reimbursement without loss of seniority rights
and other privileges, in addition to full backwages, inclusive of allowances and benefits, pursuant to Article 279
of the Labor Code.

o San Miguel Foods, Inc vs Rivera, Gr 220103, 31 January 2018

Ø The petitioner, a corporation organized and existing under Philippine laws, is engaged in the feeds, and poultry
and meats businesses. To maximize efficiency and cost effectiveness, the petitioner opted to outsource the
invoicing services, which it deems merely ancillary to its business as it simply involved: (1) witnessing and
checking the unloading of chicken products in designated outlets; (2) preparation of invoice, delivery receipt and
other documents required to complete the delivery in designated outlets; (3) securing from designated outlets
such receiving documents and/or information necessary for the liquidation and subsequent collection of the
delivery; and (4) submission of reports to the petitioner on actual volumes delivered to designated outlets.
Ø Thus, sometime in 2005, the petitioner forged a six-month invoicing services contract, that is from January 17,
2005 to July 16, 2005, with IMSHR Corporate Support, Inc. (ICSI), an independent contractor duly registered
with the (DOLE) and engaged in the business of providing and supplying various services, like invoicing, to
different companies. The parties agreed that after the contract term expired and they still want to continue their
relations but without having to execute a written renewal, they shall continue to be governed by the same contract
in its entirety, except for the term, which should subsist on a month-to-month basis.
Ø In compliance therewith, ICSI assigned its employees, including the respondents, to the petitioner to perform the
invoicing services. Sometime in 2009, however, the petitioner decided to discontinue its invoicing operations at
its JMT/GMA office (head office), where the respondents were assigned, and set up a new one at its San
Fernando, Pampanga, and Nueva Ecija Plants. This is to standardize its North and South Luzon operations,
among others. The petitioner accordingly informed ICSI of this decision and the latter, in turn, informed its
employees, including the respondents, of the said development and that all the affected employees shall be
considered for assignment in San Fernando, Pampanga. Those interested to be transferred were instructed to
 submit a Request for Transfer on or before July 13, 2009. Of all the respondents, only one complied with the said
directive while the others submitted their resignation letters, some others continued working and some no longer
reported to work.
Ø With the discontinuance of the invoicing operations at the petitioner's head office, the respondents filed their
consolidated Complaints for Constructive Dismissal, Regularization, Underpayment of Salaries and Service
Incentive Leave Pay, Non-Payment of 13th Month Pay, Vacation/Sick Leave, Maternity/Paternity Leave, Refund
of Cash Bond, Tax Refund, Illegal Deduction - Variance Bond, Moral and Exemplary Damages, and Attorney's
Fees (Complaints), against the former before the Labor Arbiter (LA).10

(1) the CA erred in reversing the dismissal of the Complaints and the findings of the NLRC that the
respondents are not the petitioner's employees; and
(2) the CA erred in directing the petitioner to reinstate the respondents with full status and rights of regular
employees and to grant them all benefits as may be provided for by law or any existing CBA.
The petition is impressed with merit.

ICSI is a legitimate job contractor. YES

Ø truly a legitimate contractor and not just a fly-by-night one, and thus, the employer-employee relationship
between ICSI and the respondents is maintained.
Ø First, ICSI has been incorporated and duly registered with the Securities and Exchange Commission (SEC), as
well as with the BIR, SSS, Philhealth, PAG-IBIG, and the DOLE with DOLE Certificate of Registration No.
NCR-8-0507-236. These may not be conclusive evidence of the status of the petitioner as a contractor but the fact
of its registration prevented the legal presumption of it being a mere labor-only contractor from arising.
Ø Second, ICSI has substantial capital. Per its Articles of Incorporation, ICSI has an authorized capital stock of P4
Million while per an Independent Auditor's Report for the year ended on December 31, 2008, it has a gross
income of P14,192,040 and a total assets amounting to P30,820,419.34.30 Though it is unclear whether they have
investment in the form of tools, equipments, machineries, etc., the same would not change the fact that they have
substantial capital to be considered as a legitimate contractor.
Ø Third, ICSI also has other A-list clients apart from the petitioner during the time that its contract with the former
was subsisting, which is an indication that it carries on a distinct and independent business.
Ø Fourth, ICSI also has the control on the performance of the work of its employees. It was the officer or officers
of ICSI who has the direct supervision over the respondents. In particular, it was the ICSI's Base Controller, who
gives the respondents their work schedule, while its OIC was the one who monitors their attendance. In relation to
this, quite telling is the following observations of the LA and the NLRC, thus:\
Ø With the foregoing, it cannot be denied that ICSI is a legitimate contractor. Being a legitimate contractor, the
employer-employee relationship between ICSI and the respondents is maintained. Even with the application of
the four-fold test to determine the existence of employer-employee relationship, to wit: (1) the selection and
engagement of the employee; (2) the payment of wages; (3) the power of dismissal; and (4) the power of
control,36 all pointed to ICSI as the respondents' employer.
Ø With all the foregoing, this Court holds that no employer-employee relationship exists between the petitioner and
the respondents. It is an error, therefore, on the part of the CA to order the petitioner to reinstate the respondents
and to grant them all the benefits and privileges of regular employees. Not being petitioner's employees, thus,
they cannot attain the regular status. Along side, the petitioner cannot be charged of constructive illegal dismissal
for it is beyond its power to dismiss the respondents as they were never its employees.

o Eastern Telecommunications Philippines, Inc. vs Eastern Telecoms Employees Union, GR 185665, 08 February
2012
FACTS:

Ø Eastern Telecommunications Phils., Inc. (ETPI) is a corporation engaged in the business of providing
telecommunications facilities. Eastern Telecoms Employees Union (ETEU) is the certified exclusive bargaining
agent of the company’s rank and file employees. It has an existing CBA with the company to expire in the year
2004 with a Side Agreement signed on September 3, 2001.
Ø In essence, the labor dispute was a spin-off (distribution of asset) of the company’s plan to defer payment of the
2003 14th, 15th and 16th month bonuses sometime in April 2004. The company’s main ground in postponing the
payment of bonuses is due to allege continuing deterioration of company’s financial position which started in the
year 2000. However, ETPI while postponing payment of bonuses sometime in April 2004, such payment would
also be subject to availability of funds.
Ø Invoking the Side Agreement of the existing CBA for the period 2001-2004 between Eastern ETPI and Union
ETEU, the union strongly opposed the deferment in payment of the bonuses by filing a preventive mediation
complaint with the NCMB.
Ø Later, the company made a sudden turnaround in its position by declaring that they will no longer pay the
bonuses until the issue is resolved through compulsory arbitration.
Ø Thus ETEU filed a Notice of Strike on the ground of unfair labor practice for failure of ETPI to pay the bonuses
in gross violation of the economic provision of the existing CBA.
Ø ETPI insists that it is under no legal compulsion to pay 14th, 15th and 16th month bonuses for the year 2003 and
14th month bonus for the year 2004 contending that they are not part of the demandable wage or salary and that
their grant is conditional based on successful business performance and the availability of company profits from
which to source the same. To thwart ETEU’s monetary claims, it insists that the distribution of the subject
bonuses falls well within the company’s prerogative, being an act of pure gratuity and generosity on its part.
Thus, it can withhold the grant thereof especially since it is currently plagued with economic difficulties and
financial losses.
Ø ETPI further avers that the act of giving the subject bonuses did not ripen into a company practice arguing that it
has always been a contingent one dependent on the realization of profits and, hence, the workers are not entitled
to bonuses if the company does not make profits for a given year. It asseverates that the 1998 and 2001 CBA Side
Agreements did not contractually afford ETEU a vested property right to a perennial payment of the bonuses. It
opines that the bonus provision in the Side Agreement allows the giving of benefits only at the time of its
execution. For this reason, it cannot be said that the grant has ripened into a company practice.

Is ETPI is liable to pay 14th, 15th and 16th month bonuses for the year 2003 and 14th month bonus for the
year 2004 to the members of respondent union? YES
Ø From a legal point of view, a bonus is a gratuity or act of liberality of the giver which the recipient has no right to
demand as a matter of right. The grant of a bonus is basically a management prerogative which cannot be forced
upon the employer who may not be obliged to assume the onerous burden of granting bonuses or other benefits
aside from the employee’s basic salaries or wages.
Ø A bonus, however, becomes a demandable or enforceable obligation when it is made part of the wage or salary or
compensation of the employee
Ø In the case at bench, it is indubitable that ETPI and ETEU agreed on the inclusion of a provision for the grant of
14th, 15th and 16th month bonuses in the 1998-2001 CBA Side Agreement, as well as in the 2001-2004 CBA
Side Agreement, which was signed on September 3, 2001. The provision, which was similarly worded, states:The
Company confirms that the 14th, 15th and 16th month bonuses (other than the 13th month pay) are granted.
Ø A reading of the above provision reveals that the same provides for the giving of 14th, 15th and 16th month
bonuses without qualification. The wording of the provision does not allow any other interpretation. There were
no conditions specified in the CBA Side Agreements for the grant of the benefits contrary to the claim of ETPI
that the same is justified only when there are profits earned by the company. Terse and clear, the said provision
does not state that the subject bonuses shall be made to depend on the ETPI’s financial standing or that their
payment was contingent upon the realization of profits. Neither does it state that if the company derives no
profits, no bonuses are to be given to the employees. In fine, the payment of these bonuses was not related to the
profitability of business operations.
Ø The records are also bereft of any showing that the ETPI made it clear before or during the execution of the Side
Agreements that the bonuses shall be subject to any condition. Indeed, if ETPI and ETEU intended that the
subject bonuses would be dependent on the company earnings, such intention should have been expressly
declared in the Side Agreements or the bonus provision should have been deleted altogether.
Ø Verily, by virtue of its incorporation in the CBA Side Agreements, the grant of 14th, 15th and 16th month
bonuses has become more than just an act of generosity on the part of ETPI but a contractual obligation it has
undertaken. Moreover, the continuous conferment of bonuses by ETPI to the union members from 1998 to 2002
by virtue of the Side Agreements evidently negates its argument that the giving of the subject bonuses is
a management prerogative.
Ø Granting arguendo that the CBA Side Agreement does not contractually bind petitioner ETPI to give the subject
bonuses, nevertheless, the Court finds that its act of granting the same has become an established company
practice such that it has virtually become part of the employees’ salary or wage. A bonus may be granted on
equitable consideration when the giving of such bonus has been the company’s long and regular practice.
In Philippine Appliance Corporation v. CA, it was pronounced:
Ø To be considered a “regular practice,” however, the giving of the bonus should have been done over a long
period of time, and must be shown to have been consistent and deliberate. The test or rationale of this rule on
long practice requires an indubitable showing that the employer agreed to continue giving the benefits knowing
fully well that said employees are not covered by the law requiring payment thereof.
Ø The records show that ETPI, aside from complying with the regular 13th month bonus, has been further giving its
employees 14th month bonus every April as well as 15th and 16th month bonuses every December of the year,
without fail, from 1975 to 2002 or for 27 years whether it earned profits or not. The considerable length of time
ETPI has been giving the special grants to its employees indicates a unilateral and voluntary act on its part to
continue giving said benefits knowing that such act was not required by law. Accordingly, a company practice in
favor of the employees has been established and the payments made by ETPI pursuant thereto ripened into
benefits enjoyed by the employees.
NOTES:
From the foregoing, ETPI cannot insist on business losses as a basis for disregarding its undertaking. It is manifestly
clear that although it incurred business losses in the year 2000, it continued to distribute 14th, 15th and 16th month
bonuses for said year. Notwithstanding such huge losses, ETPI entered into the 2001-2004 CBA Side Agreement on
September 3, 2001 whereby it contracted to grant the subject bonuses to ETEU in no uncertain terms. ETPI continued
to sustain losses for the succeeding years of 2001 and 2002. Still and all, this did not deter it from honoring the bonus
provision in the Side Agreement as it continued to give the subject bonuses to each of the union members in 2001 and
2002 despite its alleged precarious financial condition. Parenthetically, it must be emphasized that ETPI even agreed
to the payment of the 14th, 15th and 16th month bonuses for 2003 although it opted to defer the actual grant in April
2004. All given, business losses could not be cited as grounds for ETPI to repudiate its obligation under the 2001-
2004 CBA Side Agreement.
The Court finds no merit in ETPI’s contention that the bonus provision confirms the grant of the subject bonuses only
on a single instance because if this is so, the parties should have included such limitation in the agreement. Nowhere
in the Side Agreement does it say that the subject bonuses shall be conferred once during the year the Side Agreement
was signed.
The giving of the subject bonuses cannot be peremptorily withdrawn by ETPI without violating Article 100 of the
Labor Code:
Art. 100. Prohibition against elimination or diminution of benefits. – Nothing in this Book shall be construed to
eliminate or in any way diminish supplements, or other employee benefits being enjoyed at the time of promulgation
of this Code.
The rule is settled that any benefit and supplement being enjoyed by the employees cannot be reduced, diminished,
discontinued or eliminated by the employer. The principle of non-diminution of benefits is founded on the
constitutional mandate to protect the rights of workers and to promote their welfare and to afford labor full protection.

o Dubongco vs Commission on Audit, GR 237813, 05 March 2019

Ø Public Sector Labor Management Council (PSLMC) issued Resolution No. 4, Series of 2002, entitled "Grant of
Collective Negotiation Agreement (CNA) Incentive for National Government Agencies, State Universities and
Colleges and Local Government Units." The CNA Incentive is awarded to employees in "recognition of the joint
efforts of labor and management in the achievement of planned targets, programs and services approved in the
budget of the agency at a lesser cost."
Ø In 2009 and 2010, the Department of Agrarian Reform-Provincial Office-Cavite (DARPO-Cavite) released CNA
Incentive to its officials and employees in the aggregate amounts of P1,518,800.00 and P1,176,000.00,
respectively. The grant was sourced from the Comprehensive Agrarian Reform Program (CARP) Fund.
Consequently, respondent COA, through the Audit Team Leader and Supervising Auditor of Audit Group E-
Cavite Province, issued two Notices of Disallowance (NDs) against DARPO-Cavite.
Ø The audit officers reasoned that the utilization of the CARP Fund for the grant of CNA Incentive was illegal
because the appropriation and expenditure of the CARP Fund The COA added that the CARP Fund is a special
fund which could only be utilized for the purpose for which it was created, that is, solely for the implementation
of CARP projects.

Issue: W/N the CARP fund may be a valid source of CNA Incentives for rank-and-file incentives. NO
Ø CNA Incentive may be granted to rank-and-file employees only if there are savings from operating expenses. Sec.
7.1 of Budget Circular No. 2006-1, which provides the procedural guidelines and limitations on the grant of the
CNA Incentive provide that The CAN Incentive shall be sourced solely from savings from released Maintenance
and Other Operating Expenses (MOOE) allotments for the year under review.
Ø Based on the applicable provisions, the CARP Fund may not be legally used to finance the grant of the CNA
Incentive.
Ø The circular used the word "shall" in referring to the use of MOOE funds for the CNA. It is a rule in statutory
construction that the use of “shall” denotes an imperative, underscoring the mandatory character of the
provisions. Thus, there can be no logical conclusion than that the CNA Incentive may be awarded to rank-and-file
employees only if there are savings in the agency's operating expenses. The grant of CNA incentives financed by
the CARP Fund is not only illegal but also inconsiderate of the plight of Filipino farmers for whose benefit the
 CARP Fund is allocated. The CARP Fund is a special trust fund. The court ruled before that the revenue collected
for a special purpose shall be treated as a special fund to be used exclusively for the stated

o Gerardo Roxas vs Baliwag Transit, Inc. et al., GR No. 231859, 19 February 2020
change of working hours/ reduction of workweek

illegal dismissal is the result of action by the employer,

a constructive dismissal is the result of an action by the employee who find continued employment impossible,
unreasonable, or unlikely, due to actions or omissions by the employer.
[C]onstructive dismissal is defined as quitting or cessation of work because continued employment is
rendered impossible, unreasonable or unlikely; when there is a demotion in rank or a diminution of pay and other
benefits. It exists if an act of clear discrimination, insensibility, or disdain by an employer becomes so unbearable
on the part of the employee that it could foreclose any choice by him except to forego his continued employment.
There is involuntary resignation due to the harsh, hostile, and unfavorable conditions set by the employer. The
test of constructive dismissal is whether a reasonable person in the employee's position would have felt
compelled to give up his employment/position under the circumstances.
Facts:
Ø Petitioner Gerardo C. Roxas was employed as bus driver by respondent Baliwag Transit Inc. since March 24,
1998 and paid on commission basis.
Ø In 2012, the bus to which he was assigned was phased out pursuant to Land Transportation Franchising and
Regulatory Board (LTFRB) Resolution 2013-01. Consequently, he became a reliever for Baliwag’s other
remaining buses and his work assignment was reduced from his regular three-week work duty to only two weeks
per month.
Ø Aggrieved, petitioner filed on June 5, 2014 a complaint for constructive dismissal, non-payment of holiday pay,
holiday premium, service incentive leave and 13th month pay, illegal suspension, moral and exemplary damages
and attorney’s fees against Baliwag and its owner Tengco. He claimed he was constructively dismissed due to his
reduced work assignment which consequently affected his pay and other benefits.

Whether Roxas was constructively dismissed. NO

Ø In this case, while Roxas’ reduced work assignment did effectively result in the diminution of his pay and other
benefits, the same did not amount to a clear act of discrimination, insensibility or disdain on the part of Baliwag
so as to force him out of employment.
Ø This is because the reason for the said work reduction was due to the phase out of Baliwag’s old buses as
imposed by a government regulation, leading Baliwag to, in the exercise of its management prerogative, adjust
the previous work assignments of its employees assigned to the affected buses.
Ø The reduction in work assignment was in compliance with a government imposed regulation and that the same
applied to all drivers and conductors.
It ruled that BTI's decision to reduce the work week was a reasonable and valid exercise of management
prerogative having been done in compliance with a government issued regulation that applied to all its
affected drivers and conductors.
Ø As pointed out by the CA, “the reduced work week which Baliwag implemented in 2012 was in relation to the
government’s directive to remove from the roads, public utility vehicles which are 15 years old and above, for the
safety of the riding public. The decision to phase out Baliwag’s old buses was therefore not done out of the
company’s whims and caprices only but instead, a means on the part of Baliwag to cope with the downsizing of
their business operation as a consequence of the strict implementation of LTFRB Resolution 2013-01.” As such,
this exercise of Baliwag’s management prerogative appears to have been done in good faith, and hence,
should be upheld.

ART. 297. 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 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 representatives; and
(e) Other causes analogous to the foregoing.
In this case, records reveal that Roxas was terminated by respondents for (a) indiscriminate filing of complaints
against the company tantamount to gross misconduct, (b) insubordination for his failure to comply with the company's
directive to submit additional explanation why he filed the complaints, and (c) absence without leave or
abandonment.Thus, it was incumbent upon respondents to prove by substantial evidence the validity of the foregoing
grounds for dismissal, which they failed to discharge.

In this case, records show that Roxas had, in fact, initially complied and submitted his letter of explanation why
he filed the first and second complaints against BTI In this accord, Roxas further explicated t1at he believed that
the same was already sufficient to dispel the charge of indiscriminate filing of baseless complaints.
Finally, respondents' charge of abandonment cannot likewise stand. Settled is the rule that mere absence or
failure to report for work ts not tantamount to abandonment.

Accordingly, having failed to establish by substantial evidence the just causes for Roxas's termination, it was
error for the CA to not find grave abuse of discretion on the part of the NLRC in holding that the dismissal was
valid.

In this regard, Article 294 of the Labor Code provides that an employee who is unjustly dismissed from work is
entitled to reinstatement without loss of seniority rights and other privileges, and to his full back wages, inclusive
of allowances, and to other benefits or their monetary equivalent computed from the time his compensation was
withheld from him, which in this case is reckoned from the time of his illegal dismissal on July 21, 2015, up to the
time of his actual reinstatement. However, if reinstatement is no longer possible, the employer has the option of
paying the employee his separation pay in lieu of reinstatement. Considering the length of time that had passed
since the controversy started and the existing regulation on the use of buses that has affected respondents'
operations, there is a need to remand the case to the NLRC to determine if Roxas's reinstatement, as
consistently prayed for, is still viable under the circumstances.

On the other hand, with respect to Roxas's claim for 13th month pay, the same is not wan-anted since Section 3
(e) of the Rules and Regulations Implementing Presidential Decree No. 851 expressly exempted from payment
of 13th month pay "[e]mployers of those who are paid on purely commission, boundary, or task basis, and those
who are paid a fixed amount for performing a specific work, irrespective of the time consumed in the
performance thereof, except where the workers are paid on piece-rate basis in which case the employer shall be
covered by this issuance insofar as such workers are concerned."

o Intec Cebu Inc et al vs Court of Appeals, GR 189951, 22 June 2016

FACTS:
Ø Petitioner Intec Cebu Inc. (Intec), engaged in the manufacture and assembly of mechanical system, hired
respondents as production workers.
Ø Respondents alleged that their working days were reduced from 6 to 2-4 days. Intec apparently explained that
reduction in working days was due to lack of job orders however, respondents discovered that Intec hired around
188 contractual employees tasked to perform tasks which respondents were regularly doing. Private respondents
claimed that they were effectively terminated from employment as shown in the Establishment Termination
Report submitted to the Department of Labor and Employment (DOLE). Two (2) days later, respondents filed a
complaint for illegal dismissal.

ISSUE: Did Intec Cebu Inc. Illegally dismissed respondents? YES.

Ø Intec committed illegal reduction of work hours. Constructive dismissal occurs when there is cessation of work
because continued employment is rendered impossible, unreasonable or unlikely; when there is a demotion in
rank or diminution in pay or both; or when a clear discrimination, insensibility, or disdain by an employer
becomes unbearable to the employee. Intec's unilateral and arbitrary reduction of the work day scheme had
significantly greatly reduced respondents' salaries thereby rendering it liable for constructive dismissal.
There is no reason to implement a cost-cutting measure in the form of reducing the employees'
working days.
Ø An examination of Intec's financial statements for 2005-2006 shows that while Intec suffered a net loss of
₱9,240,929.00 in 2005, it earned a net income of ₱9,568,674.00 in 2006. The period covered in the financial
statement of 2006 is from May 2005-April 2006. It was only on the 9th month of operation did Intec decide to
carry out the reduced work day scheme. Note that the reduced work day scheme was implemented only in
January 2006. Unless evidence is shown by the company that the income for 2006 was earned only between the
months of January to April, it is safe to presume that at the time the reduced work day scheme was being
implemented, the company was still benefiting from its gains as shown in the numbers for 2006.
Ø Furthermore, the loss incurred in 2005 may be attributed to the acquisition of property and equipment amounting
to ₱9,218,967.00 in 2005. There is also no indication in the financial statements, much less an observation made
by the independent auditor, that a reduction in demand would necessitate a reduction in the employees' work
days. We cannot give weight to the evidence presented by Intec to prove the slump in demand.
Ø First, the two-page delivery data are lacking in specifics. The report did not indicate when it was prepared.
Ø Second, the report was prepared by Intec employees and approved by their President.
Ø Third, the report appeared to be mere projections because it was not supported by corresponding sales or delivery
receipts. The actual sales may vary from the projected demand, thus, the report cannot be made as basis of a
slump in demand or a slow-down.
Ø In addition, the hiring of 188 workers, whether they be trainees or casual employees, necessarily incurred cost to
the company. No proof was submitted that these newly-hired employees were performing work different
from the regular workers.
Ø In sum, there is no reason to implement a cost-cutting measure in the form of reducing the employees' working
days.
Intec committed illegal reduction of work hours.

oCapin-Cadiz vs Brent Hospital and Colleges, Inc, GR 187417,24 February 2016

Topic: Equality of employment opportunities considering marriages Provisions:
1. Art. 136 of the Labor Code of the Philippines Stipulation against marriage. It shall be unlawful for an employer to
require as a condition of employment or continuation of employment that a woman employee shall not get married, or
to stipulate expressly or tacitly that upon getting married, a woman employee shall be deemed resigned or separated,
or to actually dismiss, discharge, discriminate or otherwise prejudice a woman employee merely by reason of her
marriage.
2. 2. Republic Act No. 9710 (Magna Carta of Women) - protects women against discrimination in all matters relating
to marriage and family relations, including the right to choose freely a spouse and to enter into marriage only with
their free and full consent.

Facts: Cadiz was the Human Resource Officer of Brent Hospital and Colleges, Inc. Brent is an institution of the
Episcopal Church in the Philippines. She was suspended from employment in 2006 on the grounds of
Unprofessionalism and Unethical Behavior resulting to Unwed Pregnancy. The suspension will be lifted upon her
marriage to her boyfriend.

The Labor Tribunal ruled that there was just cause for her dismissal. She was not entitled to reinstatement until the
marriage, as well as to backwages and vacation/sick leave pay. She could only receive her 13th month pay (April 12,
2007). Cadiz appealed to the National Labor Relations Commission (NLRC), which affirmed the LA decision (
December 10, 2007). The Court of Appeals also dismissed her petition due to technical defects in the petition (July 22,
2008).

Issues: 1. Whether Cadiz’s premarital relations with her boyfriend and the resulting pregnancy out of wedlock
constitute immorality. No.

Brent’s Policy Manual and Employee’s Manual of Policies do not define what constitutes immorality. it simply
stated immorality as a ground for disciplinary action. As laid down in the case of Leus v. St. Scholastica’s College
Westgrove, a disgraceful conduct should be detrimental to conditions upon which depend the existence and progress
of human society. The fact that a particular act does not conform to the traditional moral views of a certain sectarian
institution is not sufficient reason to qualify such act as immoral unless it, likewise, does not conform to public and
secular standards. More importantly, there must be substantial evidence to establish that premarital sexual relations
and pregnancy out of wedlock is considered disgraceful or immoral.

"premarital sexual relations between two consenting adults who have no impediment to marry each other, and,
consequently, conceiving a child out of wedlock, gauged from a purely public and secular view of morality, does not
amount to a disgraceful or immoral conduct

The fact that Brent is a sectarian institution does not automatically subject Cadiz to its religious standard of morality.

Company A prohibit A under same business

Company B

3. Whether marriage can be a condition for reinstatement. No.

It is true that the doctrine of management prerogative gives an employer the right to regulate, according to his own
discretion and judgment, all aspects of employment. However, there are statutory laws that protect labor and promote
equal opportunity in employment which may contravene this prerogative. In consideration of Art. 136 of the Labor
Code and RA No. 9710, Brent’s condition is coercive, oppressive, and discriminatory. Brent failed to prove that the
said marriage is an employment qualification that is reasonably related to the essential operation of the job involved
and that the absence of said condition will result to Cadiz’ inability to properly perform the duties of the job. The
imposition of such condition deprives her of her freedom to choose her status.

Notes (issue of backwage and separation pay computation): -

Where reinstatement is no longer viable as an option, separation pay should be awarded as an alternative and as a form
of financial assistance. In the computation of separation pay, the Court stresses that it should not go beyond the date
an employee was deemed to have been actually separated from employment, or beyond the date when reinstatement
was rendered impossible. (P 36, 434.80) Cadiz is only entitled to limited backwages. It is computed from the time of
dismissal until the finality of the decision ordering separation pay. 62 The Court notes that at the time of Cadiz's
indefinite suspension from employment, Leus was yet to be decided by the Court. Moreover, Brent was acting in good
faith and on its honest belief that Cadiz's pregnancy out of wedlock constituted immorality. Thus, fairness and equity
dictate that the award of backwages shall only be equivalent to one (1) year or P109,304.40.

Cheryll Santos Leus vs St. Scholastica’s College Westgrove et al, GR No. 187226, 28 January 2015

FACTS: SSCW(respondent) hired the petitioner as an Assistant to SSCW‟s Director. Petitioner and her boyfriend
conceived a child out of wedlock. When SSCW learned of the petitioners pregnancy, they advised her to file a
resignation. The petitioner refused to resign her employment just because she got pregnant without the benefit of
marriage.

Respondent formally directed the petitioner to explain in writing why she should not be dismissed. Later on, being
unsatisfied with petitioner’s explanation, her employment with SSCW was terminated on the ground of serious
misconduct.

Petitioner filed a complaint for illegal dismissal. Respondent claimed that there was just cause to terminate the
petitioner and that it was a valid exercise of management prerogative. They maintained that engaging in pre-marital
sex, and getting pregnant amounts to a disgraceful or immoral conduct, which is a ground for the dismissal of an
employee under the 1992 MRPS(Manual of Regulation for Private School)

The CA and the labor tribunals affirmed the validity of the petitioner’s dismissal pursuant to Section 94(e) of the 1992
MRPS which provides: Sec. 94. Causes of Terminating Employment – In addition to the just causes enumerated in the
Labor Code, the employment of school personnel, including faculty, may be terminated for any of the following
causes xxx e. Disgraceful or immoral conduct; xxx

The labor tribunals concluded that the petitioner‟s pregnancy out of wedlock, per se, is “disgraceful and immoral”
considering that she is employed in a Catholic educational institution.

ISSUE: a.) whether the CA committed reversible error in ruling that it is the 1992 MRPS and not the Labor
Code that governs the termination of employment of teaching and non-teaching personnel of private schools
HELD: First Issue: Applicability of the Manual of Regulation for Private Schools(MRPS) THE MRPS is applicable.
MRPS, the regulation in force at the time of the instant controversy, was issued by the Secretary of Education pursuant
to BP 232 which empowers the Department of Education to promulgate rules and regulations necessary for the
administration, supervision and regulation of the educational system. The qualifications of teaching and non-teaching
personnel of private schools, as well as the causes for the termination of their employment, are an integral aspect of
the educational system of private schools. It is thus within the authority of the Secretary of Education to issue a rule,
which provides for the dismissal of teaching and non-teaching personnel of private schools based on their
incompetence, inefficiency, or some other disqualification.

b.) whether the petitioners pregnancy out of wedlock constitutes a valid ground to terminate her employment
Second Issue: Validity of the Petitioner’s Dismissal of whether pregnancy out of wedlock by an employee of a
catholic educational institution is a cause for the termination of her employment.

No. The fact of the petitioners pregnancy out of wedlock, without more, is not enough to characterize the petitioners
conduct as disgraceful or immoral. There must be substantial evidence to establish that pre-marital sexual relations
and, consequently, pregnancy out of wedlock, are indeed considered disgraceful or immoral.

The determination of whether a conduct is disgraceful or immoral involves a two step process:
1. a consideration of the totality of the circumstances surrounding the conduct
2. an assessment of the said circumstances vis-à-vis the prevailing norms of conduct, i.e., what the society generally
considers moral and respectable.

The morality referred to in the law is public and necessarily secular, not religious. Otherwise, if government relies
upon religious beliefs in formulating public policies and morals, the resulting policies and morals would require
conformity to what some might regard as religious programs or agenda.

For a particular conduct to constitute “disgraceful and immoral” behavior under civil service laws, it must be regulated
on account of the concerns of public and secular morality. It cannot be judged based on personal bias, specifically
those colored by particular mores. Nor should it be grounded on “cultural” values not convincingly demonstrated to
have been recognized in the realm of public policy expressed in the Constitution and the laws.

The petitioner’s dismissal is not a valid exercise of SSCW’s management prerogative. SSCW, as employer,
undeniably has the right to discipline its employees and, if need be, dismiss them if there is a valid cause to do so.
However, there is no cause to dismiss the petitioner. Her conduct is not considered by law as disgraceful or immoral.
Further, the respondents themselves have admitted that SSCW, at the time of the controversy, does not have any
policy or rule against an employee who engages in premarital sexual relations and conceives a child as a result thereof.
There being no valid basis in law or even in SSCW‟s policy and rules, SSCW‟s dismissal of the petitioner is not a
valid exercise of management prerogative.

In sum, the Court finds that the petitioner was illegally dismissed as there was no just cause for the termination of her
employment. SSCW failed to adduce substantial evidence to establish that the petitioners conduct in engaging in
premarital sexual relations and conceiving a child out of wedlock as considered disgraceful or immoral.

o Zaida Inocente vs St. Vincent Foundation for Children and Aging, Inc, GR 202621, 22 June 2 016
Zaida Inocente vs St. Vincent Foundation for Children and Aging, Inc./Veronica Menguito, GR No. 202621, 22
June 2016

FACTS: Petitioner was hired by St. Vincent Foundation for Children and Aging, Inc. as program assistant and
thereafter promoted her as Program Officer. Petitioner, during employment, met Marlon who was assigned in St.
Vincent’s sub-project who became her lover. St. Vincent adopted the CFCA’s Non-Fraternization which “strongly
discourage”, among others, employees from engaging in consensual romantic or sexual relationship with any
employee or volunteer of CFCA. CFCA, upon discovering Zaida and Marlon’s relationship, they ordered Zaida to
submit an explanation but was unable to convince CFCA which prompted the latter to terminate Zaida for immorality,
gross misconduct and violation of CFCA’s Code of Conduct.

In 2009, Zaida suffered a miscarriage. Zaida was again confined at the hospital for ectopic pregnancy.

The LA, the NLRC, and the CA considered Zaida's act of maintaining her relationship with Marlon, despite the
implementation of the Non-Fraternization Policy, immoral act that is prejudicial to St. Vincent's interests and which
amounted to serious misconduct. They also considered her failure to disclose the relationship as an act of dishonesty
that willfully breached St. Vincent's trust.

(St. Vincent) is a non-stock, non-profit foundation engaged in providing assistance to children and aging people and
conducting weekly social and educational activities among them. It is financially supported by the Kansas based
Catholic Foundation for Children and Aging (CFCA), a Catholic foundation dedicated to promoting Christian
values and uplifting the welfare of the children all over the world.

ISSUE: Was Zaida illegally dismissed? YES

RULING: YES. The court found Zaida's dismissal illegal for lack of valid cause. St. Vincent failed to sufficiently
prove its charges against Zaida to justify her dismissal for serious misconduct and loss of trust and confidence. While
their actions might not have strictly conformed with the beliefs, ways, and mores of St. Vincent - which is governed
largely by religious morality - or with the personal views of its officials, these actions are not prohibited under any law
nor are they contrary to conduct generally accepted by society as respectable or moral. Moreover, aside from the
relationship that St. Vincent considered to be immoral, it did not specify, nor prove any other act or acts that Zaida
might have committed to the prejudice of St. Vincent's interest. A mere allegation that Zaida committed act or acts
prejudicial to St. Vincent's interest, without more, does not constitute sufficient basis for Zaida’s dismissal. The court
also said that the phrase under CFCA’s Code of Conduct that says “strongly discourage” does not constitute
prohibition.

To place our discussions in proper perspective, the determination of whether Zaida was validly dismissed on the
ground of willful breach of trust and serious misconduct requires the prior determination of, first, whether Zaida's
intimate relationship with Marlon was, under the circumstances, immoral; and, second, whether such relationship is
absolutely prohibited by or is strictly required to be disclosed to the management under St. Vincent's Non-
Fraternization Policy.
1. On the charge of immorality and engaging in conduct prejudicial to the interest of St. Vincent
Immorality pertains to a course of conduct that offends the morals of the community.It connotes conduct or
acts that are willful, flagrant or shameless, and that shows indifference to the moral standards of the upright
and respectable members of the community.
Conducts described as immoral or disgraceful refer to those acts that plainly contradict accepted standards of
right and wrong behavior; they are prohibited because they are detrimental to the conditions on which depend
the existence and progress of human society.

The determination of whether a particular conduct is immoral involves: (1) a consideration of the totality of the
circumstances surrounding the conduct; and (2) an assessment of these circumstances in the light of the prevailing
norms of conduct, i.e., what the society generally considers moral and respectable, and of the applicable laws

both Zaida and Marlon at all times had no impediments to marry each other. While their actions might not have
strictly conformed with the beliefs of St. Vincent - which is governed largely by religious morality - or with the
personal views of its officials, these actions are not prohibited under any law nor are they contrary to conduct
generally accepted by society as respectable or moral.

mere private sexual relations between two unmarried and consenting adults, even if the relations result in pregnancy or
miscarriage out of wedlock and without more, are not enough to warrant liability for illicit behavior.

Since Zaida and Marlon's relationship was not per se immoral based on secular morality standards, St. Vincent carries
the burden of showing that they were engaged in an act prejudicial to its interest and one that it has the right to protect
against. The respondents did not specify in what manner and to what extent Zaida and Marlon's relationship
prejudiced or would have prejudiced St. Vincent's interest.

aside from the relationship that St. Vincent considered to be immoral, it did not specify, nor prove any other act or
acts that Zaida might have committed to the prejudice of St. Vincent's interest. A mere allegation that Zaida
committed act or acts prejudicial to St. Vincent's interest, without more, does not constitute sufficient basis for her
dismissal.

2. On the charge of violation of the Non-Fraternization Policy

The court also said that the phrase under CFCA’s Code of Conduct that says “strongly discourage” does not constitute
prohibition.
discourage means "to deprive of courage or confidence: dishearten, deject; to attempt to dissuade from action:
dampen or lessen the boldness or zeal of for some action."cbleslaw
prohibit means "to forbid by authority or command: enjoin, interdict; to prevent from doing or accomplishing
something: effectively stop; to make impossible: disbar, hinder, preclude."

3. On the charge of violation of the Code of Conduct provisions prohibiting acts against agency interest, acts
against persons, and violations of the terms of employment
It is premised on the alleged immoral and indecent acts committed by Zaida in engaging in consensual romantic or
sexual relationship with Marlon. Since Zaida did not violate the Non-Fraternization Policy, these other charges were
clearly unwarranted and baseless.

4. Dismissal on the ground of serious misconduct and willful breach of trust and confidence

a. Serious misconduct
 to be validly dismissed on the ground of serious misconduct, the employee must first, have committed
misconduct or an improper or wrong conduct. And second, the misconduct or improper behavior is: (1)
serious; (2) relate to the performance of the employee's duties; and (3) show that the employee has
become unfit to continue working for the employer.

Zaida's relationship with Marlon is neither illegal nor immoral; it also did not violate the Non-Fraternization
Policy. In other words, Zaida did not commit any misconduct, serious or otherwise, that would justify her
dismissal based on serious misconduct.

Moreover, St. Vincent failed to show how Zaida's relationship with Marlon affected her performance of her
duties as a Program Officer and that she has become unfit to continue working for it, whether for the same
position or otherwise. Her dismissal based on this ground, therefore, is without any factual or legal basis.

b. Willful breach of trust and confidence

employee concerned: (1) holds a position of trust and confidence, i.e., managerial personnel or those vested
with powers and prerogatives to lay down management policies and/or to hire, transfer, suspend, lay-off,
recall, discharge, assign or discipline employees; or (2) is routinely charged with the care and custody of the
employer's money or property, i.e., cashiers, auditors, property custodians, or those who, in normal and
routine exercise of their functions, regularly handle significant amounts of money or property
The breach is willful if it is done intentionally, knowingly and purposely, without justifiable excuse
guidelines for the application of the doctrine of loss of confidence, namely: (1) the loss of confidence should
not be simulated; (2) it should not be used as a subterfuge for causes which are improper, illegal or
unjustified; (3) it should not be arbitrarily asserted in the face of overwhelming evidence to the
contrary; and (4) it must be genuine, not a mere afterthought to justify earlier action taken in bad faith

Zaida indeed held a position of trust and confidence. Zaida did not commit any act or misconduct that
willfully, intentionally, or purposely breached St. Vincent's trust.

o Rivera vs Solidbank Corp, Gr 163269, 19 April 2006

nagretire na and there is 1 year post employment ban; then nakahanap siya ng other bank before 1 year elapsed; SC:
retirement fees di na need ibalik ni rivera

Ø Petitioner Rivera was employed by respondent Solidbank for 18 years when he decided to avail of the Special
Retirement Program (SRP) to devote his time to his poultry business.
Ø Under SRP, petitioner received net amount of Php 963,619.29. Solidbank further required petitioner to sign the ff:
1. Release, Waiver and Quitclaim where he acknowledged receipt of retirement benefits and promised not to
engage in any unlawful activity prejudicial to Solidbank and disclose information on operations or data of
said bank, and;
2. Undertaking where he is prohibited from accepting any kind of employment in any competitor
bank/financial institution within 1 year from 28 Feb 1995.

Ø In case of breach, the petitioner may be sued for damages and may be compelled to the return of monetary
benefits paid to him under SRP among other things.
Ø On 1 May 1995, Equitable Bank employed petitioner as Manager of Credit Investigation and Appraisal Division,
a position he held previously in Solidbank. On 19 May 1995, Solidbank informed petitioner that he violated the
Undertaking and demanded the return of all monetary benefits. However, petitioner refused. Solidbank then filed
a complaint and asked for a summary judgment before RTC Manila for breach of contract. Petitioner argued that
the employment ban in the Undertaking was void for being unreasonable and oppressive. He alleged that contrary
to his expectations, his poultry business income was not sufficient to support his family, thus forcing him to find
a job in the only field where he was qualified – banking. Solidbank maintained that the Undertaking is a
management prerogative to protect the bank from unfair competition and disclosure of trade secrets; and that it is
valid because the petitioner voluntarily signed it. RTC and CA ruled in favor of Solidbank saying that petitioner
can no longer assail the employment ban because he signed the Undertaking and received his benefits under SRP
already. Hence, this petition.

1. Whether the contract of restraint (employment ban) in the Undertaking is unreasonable and oppressive
hence contrary to public policy; NO
Unreasonableness still needs to be determined because evidence is lacking. In this case, the issue of whether
employment ban is contrary to public policy is a genuine issue of fact that requires parties to present evidence to
support their respective claims. However, the SC held that granting of the summary judgment foreclosed the
presentation of evidence on whether the ban is unreasonable. Art. 1306 provides that a contract is the law between the
parties and courts have no choice but to enforce such contract as long as it is not contrary to law, morals, good
customs or public policy.

It is essential for the employer to prove that the employment ban is reasonable and not greater than necessary to
protect the employer’s business interests. Likewise, it may not be harsh or oppressive in curtailing the employee’s
legitimate efforts to earn a livelihood and must be reasonable in light of sound public policy.

In determining whether a contract is reasonable, the trial court should consider the following: whether a. the covenant
protects a legitimate business interest of the employer; b. the covenant creates undue burden on the employee; c. the
covenant is injurious to the public welfare; d. the time and territorial limitations contained in the covenant are
reasonable; e. the restraint is reasonable from public policy’s standpoint

2. Whether petitioner is liable to return Php 963,619.29 in retirement benefits plus interest. NO
, petitioner is not liable to return the amount. The Undertaking contained a broad and comprehensive “cause of action
for protection in the courts of law”. The SC ruled that actual or compensatory damages in breach of contracts may be
awarded if offended party provides competent proof that it suffered damages and the actual amount of losses. Thus, in
this case, even if employment ban is valid and there was breach of contract, restitution of said amount is not automatic
since the respondent still has to prove that it suffered damages and is entitled to the amount of Php 963, 619.28. >
Retirement plans must be liberally construed in favor of the employee since retirement benefits, a form of reward for
being loyal to the employer, are intended to help the employee enjoy the remaining years of his life without worrying
for his financial support. > Summary Judgment may be granted if there are no disputed material facts and/or if
evidence presented to the court supports only one interpretation. Two requisites that must be established: a. there is no
genuine issue as to any material fact, except on amount of damages; b. the party presenting for summary judgment is
entitled to such as matter of law

oYrasuegui vs PAL, Inc., GR 168081, 17 October 2008

FACTS:
Ø Petitioner Armando G. Yrasuegui was a former international flight of Philippine Arlines, Inc. He stands at 5’8”.
As mandated by the Cabin and Crew Administration Manual of PAL, the proper weight for a man of this height is
from 147-166 pounds, the ideal weight being 166 pounds.
Ø To address his weight concerns, petitioner was advised to go on leave without pay. But after gaining 43 pounds
over his ideal weight, petitioner was removed from flight duty, as per company policy. He was formally
requested to trim down to his ideal weight and report for weight checks on several dates. However, instead of
losing weight, he gained them instead.
Ø On January 3, 1990, he was informed of the PAL decision for him to remain grounded until such time that he
satisfactorily complies with the weight standards and was directed to report every 2 weeks for weight checks.
Ø After petitioner’s repeated failure to report for weight checks, he was formally warned that a repeated refusal to
report for weight check would be dealt with accordingly. He was given another set of weight check dates which
petitioner ignored. When petitioner finally tipped the scale on July 30, 1990, he weighed at 212 pounds which is
way over his ideal weight of 166 pounds.
Ø From then on, nothing was heard from petitioner until he followed up his case requesting for leniency on the
latter part of 1992.
Ø On November 13, 1992, PAL finally served petitioner a Notice of Administrative Charge for violation of
company standards on weight requirements. Petitioner claimed that PAL discriminated against him because “the
company has not been fair in treating the cabin crew members who are similarly situated.”
Ø On June 15, 1993, petitioner was formally informed by PAL that due to his inability to attain his ideal weight,
“and considering the utmost leniency” extended to him “which spanned a period covering a total of almost 5
years,” his services were considered terminated “effective immediately.
Ø Petitioner filed a complaint for illegal dismissal against PAL.

Whether or not petitioner’s dismissal for obesity can be predicated on the “bona fide occupational
qualification” defense. NO
RULING:
Ø In British Columbia Public Service Employee CommissionA (BSPSERC) v. The British Columbia Government
and Service Employee’s Union (BCGSEU), the Supreme Court of Canada adopted the so-called “Meiorin Test”
in determining whether an employment policy is justified. Under this test, (1) the employer must show that it
adopted the standard for a purpose rationally connected to the performance of the job; (2) the employer must
establish that the standard is reasonably necessary to the accomplishment of that workrelated purpose; and (3) the
 employer must establish that the standard is reasonably necessary in order to accomplish the legitimate work-
related purpose.
Ø Similarly, in Star Paper Corporation v. Simbol, the SC held that in order to justify a BFOQ, the employer must
prove that (1) the employment qualification is reasonably related to the essential operation of the job involved;
and (2) that there is factual basis for believing that all or substantially all persons meeting the qualification would
be unable to properly perform the duties of the job.
Ø In short, the test of reasonableness of the company policy is used because it is parallel to BFOQ. BFOQ is valid
“provided it reflects an inherent quality reasonably necessary for satisfactory job performance.”
Ø A common carrier, from the nature of its business and for reasons of public policy, is bound to observe
extraordinary diligence for the safety of the passengers it transports. It is bound to carry its passengers safely as
far as human care and foresight can provide, using the utmost diligence of very cautious persons, with due regard
for all the circumstances. The law leaves no room for mistake or oversight on the part of a common carrier. Thus,
it is only logical to hold that the weight standards of PAL show its effort to comply with the exacting obligations
imposed upon it by law by virtue of being a common carrier.
Ø The business of PAL is air transportation. As such, it has committed itself to safely transport its passengers. In
order to achieve this, it must necessarily rely on its employees, most particularly the cabin flight deck crew who
are on board the aircraft. The weight standards of PAL should be viewed as imposing strict norms of discipline
upon its employees.
Ø In other words, the primary objective of PAL in the imposition of the weight standards for cabin crew is flight
safety. It cannot be gainsaid that cabin attendants must maintain agility at all times in order to inspire passenger
confidence on their ability to care for the passengers when something goes wrong.
Ø The task of a cabin crew or flight attendant is not limited to serving meals or attending to the whims and caprices
of the passengers. The most important activity of the cabin crew is to care for the safety of passengers and the
evacuation of the aircraft when an emergency occurs. Passenger safety goes to the core of the job of a cabin
attendant. On board an aircraft, the body weight and size of a cabin attendant are important factors to consider in
case of emergency. Aircrafts have constricted cabin space, and narrow aisles and exit doors. Thus, the arguments
of respondent that “whether the airline’s flight attendants are overweight or not has no direct relation to its
mission of transporting passengers to their destination”; and that the weight standards “has nothing to do with
airworthiness of respondent’s airlines,” must fail.
Ø The biggest problem with an overweight cabin attendant is the possibility of impeding passengers from
evacuating the aircraft, should the occasion call for it. The job of a cabin attendant during emergencies is to
speedily get the passengers out of the aircraft safely. Being overweight necessarily impedes mobility. Indeed, in
an emergency situation, seconds are what cabin attendants are dealing with, not minutes.

oCoca-cola Bottlers Philippines, Inc vs CCBPI Sta. Rosa Plant Employees Union, GR 197494, 25 March 2019

Petitioner Coca-Cola Bottlers Philippines, Inc. (CCBPI) is engaged in the business of manufacturing, distributing, and
marketing beverage products while CCBPI Sta. Rosa Plant Employees' Union (respondent Union) is a recognized
labor union organized and registered with the Department of Labor and Employment (DOLE) and the sole
representative of all regular daily paid employees and monthly paid non-commission earning employees within
petitioner's Sta. Rosa, Laguna plant.

Ø petitioner implemented a policy which limits the total amount of loan which its employees may obtain from the
company and other sources such as the Social Security System (SSS), PAG-IBIG, and employees' cooperative to
50% of their respective monthly pay.
Ø According to the, Respondent Union such policy as violative of a provision in the (CBA), which states that
petitioner shall process all SSS loans of its employs, subject to SSS rules and regulations.
Ø Petitioner anchored on its stand and argued that the company policy is in compliance with the Labor Code
considering that it ensures that the employees' wages are directly paid to the employees themselves and not to
third party creditors.
Ø Voluntary Arbitrator ruled in favor of the respondent Union. The Voluntary Arbitrator maintained that Section
2, Article 14 of the CBA is clear when it provided that petitioner shall process all SSS loans, subject only to SSS
rules and regulations
Ø CA Affirming the Decision of the Voluntary Arbitrator, the rendered the assailed Decision11 dated January 27,
2011. The CA observed that such company policy is violative of the CBA in the absence of any SSS regulation
supporting the same. The fallo thereof reads:

whether or not petitioner's company policy which limits the availment of loans depending on the average take
home pay of its employees violates a provision in the CBA. YES
a) Does the employer have the prerogative to limit the availment of loans of its employees from financial
institutions including the SSS? NO

the CBA is the law between the parties and they are obliged to comply with its provisions.14 As in all contracts, the
parties in a CBA may establish such stipulations, clauses, terms and conditions as they may deem convenient provided
these are not contrary to law, morals, good customs, public order, or public policy. Thus, where the CBA is clear and
unambiguous, it becomes the law between the parties and compliance therewith is mandated by the express policy of
the law.

On the other hand, the company policy puts a cap relative to the loan availment by the employees depending on the
employees' monthly basic net pay. In other words, petitioner shall disapprove the loan application of an employee
whose net take home pay falls below 50% of his average monthly basic pay.

Based on the foregoing, it appears that the qualification of a member-borrower is dependent on the amount of loan to
be taken, updated payment of his contributions and other loans, and age, which should be below 65 years.

On the other hand, the responsibility of an employer is limited to the collection and remittance of the employee's
amortization to SSS as it causes the deduction of said amortizations from the employee's salary. Based on said terms
and conditions, it does not appear that the employer has the prerogative to impose other conditions which does not
involve its duty to collect and remit amortizations. The 50% net take home pay requirement, in effect, further adds a
condition for an employee to obtain an SSS salary loan, on top of the requirements issued by the SSS. Hence, when
petitioner requires that the employee should have at least 50% net take home pay before it processes a loan application,
the same violates the CBA provision when a qualified employee chooses to apply for an SSS loan.

With these, we rule that the company policy violated the provision of the CBA as it imposes a restriction with respect
to the right of the employees under the CBA to avail SSS salary loans.

While petitioner's cause for putting a limitation on the availment of loans, i.e., to promote the welfare of the
employees and their families by securing that the salary of the concerned employee shall be taken home to his family,
is sympathetic, we cannot subscribe to the same for being in contravention with the prohibition on interfering with the
disposal of wages under Article 112 of the Labor Code:

Art. 112. Non-interference in disposal of wages. No employer shall limit or otherwise interfere
with the freedom of any employee to dispose of his wages. He shall not in any manner force,
compel, or oblige his employees to purchase merchandise, commodities or other property from any
other person, or otherwise make use of any store or services of such employer or any other person.

With the implementation of the company policy, an employee, who is qualified to avail an SSS salary loan and
chooses to dispose of his salary through payment of monthly amortizations, may not be able to do so should
such amortizations be over the 50% cap. In carrying out the 50% cap policy, petitioner effectively limits its
employees on the utilization of their salaries when it is apparent that as long as the employee is qualified to
avail the same, he/she may apply for an SSS loan.

Considering the foregoing, the implementation of the company policy is not a valid exercise of management
prerogative, which must be exercised in good faith and with due regard to the rights of labor.20 Its violation of a
provision in the CBA demerits the presence of good faith.

In the absence of an SSS rule or regulation which limits the qualification of employees to obtain a loan, petitioner has
the obligation to process the same so as to comply with the provisions of the CBA.

Airborne Maintenance and Allied Services, Inc vs Arnulfo Egos, GR 222748, 03 April 2019
Ø On April 9, 1992, petitioner Airborne Maintenance and Allied Services Inc. (Airborne) hired the services of
respondent Arnulfo Egos as janitor. He was assigned at the Balintawak branch of Meralco, a client of Airborne.

Ø On June 30, 2011, the contract between Airborne and Meralco-Balintawak branch expired and a new contract was
awarded to Landbees Corp. which absorbed all employees of Airborne except respondent, who allegedly had a
heart ailment. Respondent consulted another doctor who declared him in good health and fit to work. He showed
 a duly issued medical certificate to Airborne but the same was disregarded. Feeling aggrieved, respondent filed a
complaint for constructive illegal dismissal on Aug. 5, 2011.

Ø Airborne insisted that respondent was never dismissed from the service. It claimed that when its contract with
Meralco was terminated, it directed all its employees including respondent to report to its office for reposting.
When respondent failed to comply with the directive, it sent him letters dated Aug. 12, 2011 and Sept. 21, 2011 to
his last known address reiterating the previous directive but which were returned with a notation “RTS
unknown.” It further argued that it had placed respondent on floating status when the contract with Meralco was
terminated.

Does Airborne’s defense find merit? NO

Ø The Court finds that petitioner failed to prove that the termination of the contract with Meralco resulted in a bona
fide suspension of its business operations so as to validly place respondent in a floating status.

Ø In implementing this measure, jurisprudence has set that the employer should notify the (Dole) and the affected
employee, at least one month prior to the intended date of suspension of business operations. An employer must
also prove the existence of a clear and compelling economic reason for the temporary shutdown of its business or
undertaking and that there were no available posts to which the affected employee could be assigned.

Ø Here, a review of the submissions of the parties shows that petitioner failed to show compliance with the notice
requirement to the Dole and respondent. Making matters worse for petitioner, it also failed to prove that after the
termination of its contract with Meralco it was faced with a clear and compelling economic reason to temporarily
shut down its operations or a particular undertaking. It also failed to show that there were no available posts to
which respondent could be assigned.

Ø Also, not only did petitioner fail to prove it had valid grounds to place respondent on a floating status, but the
National Labor Relations Commission (NLRC) and the Court of Appeals both correctly found that respondent
even had to ask for a new assignment from petitioner, but this was unheeded. Further, when respondent filed the
complaint on Aug. 5, 2011, petitioner, as an afterthought, subsequently sent notices/letters to respondent directing
him to report to work. These, however, were not received by respondent as the address was incomplete.

Ø Here, the totality of the foregoing circumstances shows that petitioner’s acts of not informing respondent and the
Dole of the suspension of its operations, failing to prove the bona fide suspension of its business or undertaking,
ignoring respondent’s follow-ups on a new assignment, and belated sending of letters/notices which were
returned to it, were done to make it appear as if respondent had not been dismissed. These acts, however, clearly
amounted to a dismissal, for which petitioner is liable.

o Ernesto Galang et al vs BOIE Takeda Chemicals, Inc, GR 183934, 20 July 2016

Concept: To be considered as a regular company practice the employee must prove by substantial evidence that the
giving of the benefit is done over a long period of time, and that it has been made consistently and deliberately

Facts:
Ø Respondent Boie Takeda Chemicals, Inc. (BTCI) hired petitioners Ernesto Galang and Ma. Olga Jasmin Chan.
Petitioners rose from the ranks and were promoted to Regional Sales Managers. As Regional Sales Managers,
they belong to the sales department of BTCI.
Ø When the National Sales Director position became vacant, the General Manager, (Nomura), asked petitioners to
apply for the position of National Sales Director. Later, however, petitioners were informed that BTCI, instead of
the petitioners, promoted Edwin Villanueva as National Sales Director.
Ø Petitioners believed that Villanueva did not apply for the position, and has only three years of experience in sales.
Aggrieved of not being the one promoted, petitioners inquired if they could avail of early retirement package due
to health reasons.
Ø Specifically, they requested Nomura if they could avail of the early retirement package of 150% plus 120% of
monthly salary for every year of service tax free, and full ownership of service vehicle tax free. They claimed that
this is the same retirement package given to previous retirees namely, former Regional Sales Director Jose
Sarmiento, Jr. (Sarmiento), and former National Sales Director Melchor Barretto. Nomura, however, insisted that
such retirement package does not exist and Sarmiento's case was exceptional since he was just a few years shy
from the normal retirement age. Then, petitioners intimated their intention to retire.
Ø Thereafter, petitioners received their retirement package and other monetary pay from BTCI. Upon petitioners'
retirement, the positions of Regional Sales Manager were abolished, and a new position of Operations Manager
was created.
Ø The Arguments Petitioners argue that they were constructively dismissed because of the acts of BTCI 's General
Manager Nomura. They claim that they were forced into resigning because instead of promoting them to the
position of National Sales Directors, BTCI hired Villanueva who only had three years of service in the company,
who has no background or experience in sales to speak of.
Ø Petitioners also argue that the retirement package given to them is lower compared to others who were holding
the similar position at the time of their retirement. Petitioners cite the case of one Sarmiento, who was promoted
with them to the same position, and who opted for early retirement in 2001. Sarmiento allegedly received a more
generous package compared to what petitioners received. For its part, BCTI claims that the complaint is only an
attempt to extort additional benefits from the company.
Ø BTCI argues that no constructive dismissal can occur because there was no movement or transfer of position or
diminution of salaries or benefits. Neither was there any circumstance that would make petitioners' continued
employment unreasonable or impossible, and that the appointment of Villanueva was within the management
prerogative. As to the payment of retirement benefits, BTCI insists that petitioners have been paid according to
the Collective Bargaining Agreement (CBA) between BTCI and BTCI Supervisory Union. Although petitioners
are managers (and are not covered by the CBA), BTCI by practice grants the same retirement benefits to
managers. BTCI admits that it gave Sarmiento additional financial assistance because of serious health problems,
and because he was merely three years away from normal retirement. Other employees cited by petitioners all
received retirement benefits computed on the CBA provisions. Labor Arbiter, NLRC, and CA: The labor arbiter
ruled that the petitioner was constructively dismissed, but it was reversed by the NLRC for failure to prove that
they were indeed constructively dismissed. CA affirmed NLRC’s decision.

I. Whether petitioners were constructively dismissed from service. NO

Ø Petitioners were not constructively dismissed from service
Ø Constructive dismissal has often been defined as a "dismissal in disguise" or "an act amounting to dismissal but
made to appear as if it were not." It exists where there is cessation of work because continued employment is
rendered impossible, unreasonable or unlikely, as an offer involving a demotion in rank and a diminution in pay.
In some cases, while no demotion in rank or diminution in pay may be attendant, constructive dismissal may still
exist when continued employment has become so unbearable because of acts of clear discrimination, insensibility
or disdain by the employer, that the employee has no choice but to resign.
Ø Under these two definitions, what is essentially lacking is the voluntariness in the employee's separation from
employment.
Ø In this case, petitioners were neither demoted nor did they receive a diminution in pay and benefits. Petitioners
also failed to show that employment is rendered impossible, unreasonable or unlikely. Petitioners admitted that
they have previously intended to retire and were actually the ones who requested to avail of an early retirement.
Our labor laws respect the employer's inherent right to control and manage effectively its enterprise and do not
normally allow interference with the employer's judgment in the conduct of his business. The promotion of
employees to managerial or executive positions rests upon the discretion of management.

II. Whether petitioners are entitled to a higher retirement package. NO

Ø Petitioners were not discriminated against in terms of their retirement package. The entitlement of employees to
retirement benefits must specifically be granted under existing laws, a collective bargaining agreement or
employment contract, or an established employer policy.
Ø Based on both parties' evidence, petitioners arc not covered by any agreement. There is also no dispute that
petitioners received more than what is mandated by Article 287 of the Labor Code. Petitioners, however, claim
that they should have received a larger pay because BTCI has given more than what they received to previous
retirees, and that it has already become a company practice. The burden of proof that the benefit has ripened into
company practice rests with the employee: To be considered as a regular company practice the employee must
prove by substantial evidence that the giving of the benefit is done over a long period of time, and that it has been
made consistently and deliberately.

Petitioners presented evidence showing that Anita Ducay, Rolando Arada, Marcielo Rafael, and Sarmiento,
received significantly larger retirement benefits. However, the cases of Ducay, Arada, and Rafael cannot be used
as precedents to prove this specific company practice because these employees were not shown to be similarly
situated in terms of rank, nor are the applicable retirement packages corresponding to their ranks alike. Also,
these employees, including Sarmiento, all retired in the same year. A year cannot be considered long enough to
constitute the grant of retirement benefits to these employees as company practice.
o SHS Perforated Materials, Inc vs Diaz, GR 185814, 13 October 2012
Facts:

Ø Petitioner SHS Perforated Materials, Inc. (SHS) is a start-up corporation organized and existing under the laws of
the Republic of the Philippines and registered with the Philippine Economic Zone Authority. Petitioner Winfried
Hartmannshenn (Hartmannshenn), a German national, is its president, in which capacity he determines the
administration and direction of the day-to-day business affairs of SHS. Manuel F. Diaz (respondent) was hired by
petitioner SHS as Manager for Business Development on probationary status.

Ø On November 29, 2005, Hartmannshenn instructed Taguiang not to release respondent’s salary. Later that
afternoon, respondent called and inquired about his salary. Taguiang informed him that it was being withheld and
that he had to immediately communicate with Hartmannshenn. Respondent denied having received such directive.

Ø The next day, on November 30, 2005, respondent served on SHS a demand letter and a resignation letter. In the
evening of the same day, November 30, 2005, respondent met with Hartmannshenn in Alabang. The latter told
him that he was extremely disappointed for the following reasons: his poor work performance; his unauthorized
leave and malingering from November 16 to November 30, 2005; and failure to immediately meet
Hartmannshenn upon his arrival from Germany.

WON the temporary withholding of respondent’s salary/wages by petitioners was a valid exercise of
management prerogative. NO

Although management prerogative refers to “the right to regulate all aspects of employment,” it cannot be understood
to include the right to temporarily withhold salary/wages without the consent of the employee. To sanction such an
interpretation would be contrary to Article 116 of the Labor Code, which provides:

ART. 116. Withholding of wages and kickbacks prohibited. – It shall be unlawful for any person, directly or
indirectly, to withhold any amount from the wages of a worker or induce him to give up any part of his wages by force,
stealth, intimidation, threat or by any other means whatsoever without the worker’s consent.

Any withholding of an employee’s wages by an employer may only be allowed in the form of wage deductions under
the circumstances provided in Article 113 of the Labor Code, as set forth below:

ART. 113. Wage Deduction. – No employer, in his own behalf or in behalf of any person, shall make any deduction
from the wages of his employees, except:

(a) In cases where the worker is insured with his consent by the employer, and the deduction is to recompense the
employer for the amount paid by him as premium on the insurance;

(b) For union dues, in cases where the right of the worker or his union to check-off has been recognized by the
employer or authorized in writing by the individual worker concerned; and

(c) In cases where the employer is authorized by law or regulations issued by the Secretary of Labor.

Absent a showing that the withholding of complainant’s wages falls under the exceptions provided in Article 113, the
withholding thereof is thus unlawful.

Petitioners argue that Article 116 of the Labor Code only applies if it is established that an employee is entitled to his
salary/wages and, hence, does not apply in cases where there is an issue or uncertainty as to whether an employee has
worked and is entitled to his salary/wages, in consonance with the principle of “a fair day’s wage for a fair day’s work.”
Petitioners contend that in this case there was precisely an issue as to whether respondent was entitled to his salary
because he failed to report to work and to account for his whereabouts and work accomplishments during the period in
question.

The Court finds petitioners’ evidence insufficient to prove that respondent did not work from November 16
to November 30, 2005. As can be gleaned from respondent’s Contract of Probationary Employment and the exchanges
of electronic mail messages between Hartmannshenn and respondent, the latter’s duties as manager for business
development entailed cultivating business ties, connections, and clients in order to make sales. Such duties called for
meetings with prospective clients outside the office rather than reporting for work on a regular schedule. In other
words, the nature of respondent’s job did not allow close supervision and monitoring by petitioners. Neither was there
any prescribed daily monitoring procedure established by petitioners to ensure that respondent was doing his job.
Therefore, granting that respondent failed to answer Hartmannshenn’s mobile calls and to reply to two electronic mail
messages and given the fact that he admittedly failed to report to work at the SHS plant twice each week during the
subject period, such cannot be taken to signify that he did not work from November 16 to November 30, 2005.

o Marina’s creation Enterprises vs Ancheta, GR 218333, 07 December 2016

- Ancheta is a shoe maker, was stroked, then he filed for disability;
Argument: employer terminated ancheta because he do not want to give second medical certificate; mngt prerogative
is valid because ANcheta might suffer 3rd stroke DAW, BUT NOT;

Relevant Facts
Ø In January 2010, Romeo Ancheta was hired as a sole attacher by petitioner who was engaged in the business of
making shoes and bags.
Ø In March 2011, he suffered an intra-cranal hemorrhage (stroke) and was placed under home care. In May 2011,
he suffered a second stroke and was confined at St. Victoria Hospital. The physician who performed a check up
in lieu of his Sickness Notification with the SSS stated that he would be fit to work after 90 days or on August 12,
2011.
Ø Ancheta reported for work but petitioner wanted him to submit another medical certificate. He did not comply
and was not able to resume work so he filed a case for illegal dismissal and non-payment of separation pay.
Ø Ancheta's side: After he recovered, he reported for work but was advised to rest and wait for the company's call.
Two new workers were hired to replace him. He was not served a notice for his termination. Marina's side: He
was refused job assignments for failure to secure a medical certificate. The medical certificate serves as a
precautionary measure to avoid any incident that could happen to him.

Issue WON respondent was illegally dismissed – YES

Ø Applying Article 280 of the Labor Code, Ancheta was a regular employee of Marina. Ancheta, who was working
in Marina as a sole attacher, was performing work that was usually necessary or desirable in the usual business or
trade of Marina which was engaged in the business of making shoes and bags. Moreover, he had already worked
for petitioner for more than a year. Since Ancheta was a regular employee of Marina, Ancheta's employment can
only be terminated by Marina based on just or authorized causes provided in the Labor Code. Book VI, Rule 1,
Section 8 of the Implementing Rules of the Labor Code impose upon the employer the duty not to terminate an
employee until there is a certification by a competent public health authority that the employee's disease is of
such nature or at such a stage that it cannot be cured within a period of six months even with proper medical
treatment.
Ø In this case, Marina terminated Ancheta from employment without seeking a prior certification from a competent
public health authority that Ancheta's disease is of such nature or at such a stage that it cannot be cured within a
period of six months even with proper medical treatment. Hence, Ancheta was illegally dismissed by Marina.

Star Paper Corp vs Simbol, GR 164774, 12 April 2006

Simbol was employed by the company and met a co-

mployee and they eventually had a relationship and got married. Prior to the marriage, the manager advise the couple t
hat should they decide to get married, one of them should resign pursuant to a company policy: 1) new applicant will n
ot be allowed to be hired if he/she has a relative, up to 3rd degree of consanguinity, already employed by the company
. 2) if the two employees got married, one of them should resign to preserve the policy stated first. Simbol resigned.

Whether or not the policy of the employer banning spouse from working in the same company, a valid exercise
of management prerogative. NO

No, it is not a valid exercise of management prerogative and violates the rights of employees under the constitution. T
he case at bar involves Article 136 of the Labor Code which provides “it shall be unlawful for an employer to require
as a condition of employment or continuation of employment that a woman employee shall not get married, or to stipu
late expressly or tacitly that upon getting married, a woman employee shall be deemed resigned or separated , or to act
ually dismiss, discharge , discriminate or otherwise prejudice a woman employee merely by reason of her marriage.”

The company policy of Star Paper, to be upheld, must clearly establish the requirement of reasonableness. In the case
at bar, there was no reasonable business necessity. Petitioners failed to show how the marriage of Simbol, then a Sheet
ing Machine Operator, to Alma Dayrit, then an employee of the Repacking Section, could be detrimental to its busines
s operations. The questioned policy may not facially violate Article 136 of the Labor Code but it creates a disproportio
nate effect and under the disparate impact theory, the only way it could pass judicial scrutiny is a showing that it is rea
sonable despite the discriminatory, albeit disproportionate, effect. Lastly, the absence of a statute expressly prohibiting
marital discrimination in our jurisdiction cannot benefit the petitioners.

There was NO reasonable business necessity in this case.

Ø In the case at bar, respondents were hired after they were found fit for the job, but were asked to resign when they
married a co-employee. Petitioners failed to show how the marriage of Simbol, then a Sheeting Machine
Operator, to Alma Dayrit, then an employee of the Repacking Section, could be detrimental to its business
operations. Neither did petitioners explain how this detriment will happen in the case of Wilfreda Comia, then a
Production Helper in the Selecting Department, who married Howard Comia, then a helper in the cutter-machine.
The policy is premised on the mere fear that employees married to each other will be less efficient. If we
uphold the questioned rule without valid justification, the employer can create policies based on an
unproven presumption of a perceived danger at the expense of an employee’s right to security of tenure.
Petitioners contend that their policy will apply only when one employee marries a co-employee, but they are free to
marry persons other than co-employees. The questioned policy may not facially violate Article 136 of the Labor Code
but it creates a disproportionate effect and under the disparate impact theory, the only way it could pass judicial
scrutiny is a showing that it is reasonable despite the discriminatory, albeit disproportionate, effect. The failure of
petitioners to prove a legitimate business concern in imposing the questioned policy cannot prejudice the
employee’s right to be free from arbitrary discrimination based upon stereotypes of married persons working
together in one company.

ON SECURITY OF TENURE
Raymond A. Son et al vs University of Sto. Tomas et al, GR 211273, 18 April 2018
FACTS:
Ø Petitioners Son, Antiola and Pollarco are fulltime professors of the UST College of Fine Arts and Design and
Philosophy and members of the UST Faculty Union.
Ø Petitioners Son and Antiola were hired by UST in June, 2005, while Pollarco was employed earlier oR in June
2004. Under their respective appointment papers, petitioners were designated as “Faculty members of
PROBATIONARY status,” whose accession of tenure status is conditioned by their meeting all the
requirements provided under existing university rules and regulations and other applicable laws, including among
others, possession of the prerequisite graduate degree before the expiration of the probationary period and by
their satisfactory performance of their duties and responsibilities set forth in the job description.
Ø The UST-UST Faculty Union CBA, in line with the 1992 Revised Manual of Regulations for private schools
issued by then DECS and the CHED’s Memorandum Order No. 40-08 provided that “ Although the
master’ s degree is an entry requirement, a faculty member admitted to serve the university without a master ’s
degree is an entry requirement, a faculty member admitted to serve the university without a master ’s degree
shall finish his master ’s degree in five semesters. If he does not finish his degree in five semesters, he shall
be separated from service at the end of the fifth semester; however, if he is made to serve the University
further, in spite of lack of master’ s degree, he shall be deemed to have attained tenure.”

For undergraduate program

 a. Holder of a master's degree; to teach mainly in his major field and where applicable, a holder of appropriate professional
license requiring at least a bachelor's degree for the professional courses. However, in specific fields where there is
dearth of holders of Master's degree, or a holder of a professional license requiring at least a bachelor's degree may be
qualified to teach. Any deviation from this requirement will be subject to regulation by the Commission.

Ø Petitioners did not possess the required master’s degree, but were nonetheless hired by UST on the
condition that they fulfill the requirement within the prescribed period. Petitioner enrolled in the Master’s
program, but were unable to finish the same. In spite of their failure to obtain the required master’s degree,
they continued to teach beyond the period given for the completion thereof.
Ø On March 3, 2010, the CHED Chairman issued a Memorandum addressed to Presidents of public and private
higher education institutions, directing the strict implementation of the minimum qualification for faculty
members of undergraduate programs, particularly the Master’s degree and licensure requirements”
Ø UST informed the petitioners of its decision to cease reappointment of those who failed to complete their
Master’s degree, but allow a written appeal from the concerned faculty members who are due for thesis
defense/completion for their Master’s degrees.
Ø Petitioners however did not make a written appeal operating on the belief that they have been vested tenure under
the CBA for their continued employment despite failure to obtain the required Masters Degree. On June 10, 2010,
they received termination letters for failure to obtain Master’s degree, prompting the petitioners to file a
labor case against the respondents for unfair labor practice, illegal dismissal and recovery of money
claims.

LA -
In their joint Position Paper and other pleadings respondents countered that there is no unfair labor practice committed, because the CBA provision
adverted to is not an economic provision.
The Labor Arbiter upheld the CBA provision granting tenure by default to petitioners, and declared that petitioners were not accorded due process
prior to dismissal. Thus, petitioners were awarded money claims, damages, and attorney's fees.

NLRC
It held that the UST-UST Faculty Union CBA took precedence over CHED Memorandum Order No. 40-08; that by said CBA provision, petitioners
acquired tenure by default; that UST continued to hire faculty members without the required Master's degree in their field of instruction even after
petitioners were dismissed from work; and that the only cause for petitioners' dismissal was their refusal to submit a written appeal, which is not a
valid ground for dismissal or non-renewal of their appointment

CA--- affirmed in toto

Private respondents' reliance on the collective bargaining agreement is not tenable.
In the instant case, there is no doubt that private respondents failed to meet the standards for regular employment provided
under Memorandum Order No. 040-08 issued by CUED. The termination of their contract was based on their failure to
obtain [a] master's degree and cannot, therefore, be regarded as illegal. In fact, the services of an employee hired on
probationary basis may be terminated when he fails to qualify as a regular employee in accordance with reasonable
standards made known by the employer to the employee at the time of his engagement. There is nothing that would hinder
the employer from extending a regular or permanent appointment to an employee once the employer finds that the employee
is qualified for a regular employment even before the expiration of the probationary period.

Conversely, if the purpose sought by the employer is neither attained nor attainable within the said period, the law does not
preclude the employer from terminating the probationary employment on justifiable ground. Mere, no vested right to
tenureship had yet accrued in private respondents' favor since they had not complied, during their probation, with the
prerequisites necessary for the acquisition of permanent status. It must be stressed that herein private respondents were
given more than ample opportunities to obtain their respective master's degree since their first appointment in 2004 or 2005
as a prerequisite to tenure status. But they did not take advantage of such opportunities. Justice, fairness, and due process
demand that an employer should not be penalized for situations where it had little or no participation or control.

Were the petitioners illegally dismissed?

RULING: No.
In one of the cases, the requirement of a masteral degree for tertiary education teachers was held to be not
unreasonable but rather in accord with the public interest.
Thus, when the CBA was executed between the parties in 2006, they had no right to include therein the provision
relative to the acquisition of tenure by default, because it is contrary to, and thus violative of, the 1992 Revised
Manual of Regulations for Private Schools that was in effect at the time. As such, said CBA provision is null and void,
and can have no effect as between the parties. "A void contract is equivalent to nothing; it produces no civil effect; and
it does not create, modify or extinguish a juridical relation.
Thus, going by the requirements of law, it is plain to see that petitioners are not qualified to teach in the undergraduate
programs of UST. And while they were given ample time and opportunity to satisfy the requirements by obtaining
their respective master's degrees, they failed in the endeavor. Petitioners knew this - that they cannot continue to teach
for failure to secure their master's degrees - and needed no reminding of this fact; "those who are seeking to be
educators are presumed to know these mandated qualifications.

a) Does academic freedom give respondents the unbridled right to undermine petitioners’ right to security of
tenure? Yes
the petitioner University as an educational institution enjoys academic freedom - a guarantee that enjoys protection
from the Constitution. Section 5(2), Article XIV of the 1987 Constitution guarantees all institutions of higher learning
academic freedom. This institutional academic freedom includes the right of the school or college to decide for itself,
its aims and objectives, and how best to attain them free from outside coercion or interference save possibly when the
overriding public welfare calls for some restraint. Indeed, the Constitution allows merely the State's regulation and
supervision of educational institutions, and not the deprivation of their rights.

The essential freedoms subsumed in the term 'academic freedom' encompasses the freedom to determine for itself on
academic grounds: (1) Who may teach, (2) What may be taught, (3) How it shall be taught, and (4) Who may be
admitted to study. Undeniably, the school's prerogative to provide standards for its teachers and to determine
whether or not these standards have been met is in accordance with academic freedom that gives the
educational institution the right to choose who should teach.

The authority to choose whom to hire is likewise covered and protected by its management prerogative.

b) Is the provision of the CBA on acquisition of tenure by default valid? No

Ø When the CBA was executed by the parties in 2006, they had no right to include therein the provision relative to
the acquisition of tenure by default, because it is contrary to and thus violative of, the 1992 Revised Manual of
Regulations for Private Schools that is in effect at that time. As such, said CBA provision in void, and has no
effect as between the parties. Thus going by the requirements of law, it is plain to see that petitioners are not
qualified to teach in the undergraduate programs of the UST. Petitioners knew this- that they cannot continue
to teach for failure to secure their master’s degrees- and needed no reminding of this fact: “those who are
seeking to be educators are presumed to kno these mandated qualifications.”
Ø The court held in Manaois vs St. Scholastica that for failure of Manaois to satisfy the academic requirements for
the position, she may only be considered as part-time instructor. A part time member of the academic personnel
cannot acquire permanence of the employment and security of tenure under the Manual of Regulations in relation
to the Labor Code.

Pari delicto- in equal default

Under the pari delicto doctrine, the parties to a controversy are equally culpable or guilty, they shall have no action against
each other, and it shall leave the parties where it finds them. This doctrine finds expression in the maxims "ex dolo malo
nonoritur actio" and "in pari delicto potior est conditio defendentis."

Section 89. Conditions of Employment. Every private school shall promote the improvement of the economic, social
and professional status of all its personnel. 1992 Manual of Regulations for Private Schools (1992 Manual).

Robert Emmanuel Feliciano vs Department of National Defense, GR 199232, 08

November 2017
a) What are the requirements for employees in the CES (Career Executive
Service) to acquire security of tenure?
FACTS:
Ø Exec. Sec. Ochoa issued Memo. Circular No. 1, providing the termination of all non-CES Officials occupying
career executive service positions in all agencies of the Executive Branch.
Ø The petitioners were terminated from their respective positions as Assistant Secretary and Director III of the
DND for having lacked the requirement of completing four stages of qualification for the Career Executive
Service Eligibility (CESE), which would have given them security of tenure. This SC appeal seeks to undo the
termination of the petitioners' service by the DND on the basis that they did not enjoy security of tenure.

ISSUE: WERE PETITIONERS ILLEGALLY TERMINATED IN VIEW OF THEIR SECURITY OF

TENURE? NO
Ø the termination of the petitioners upon the stated ground was valid. Sec. 3, Art. IX-B of the Constitution
specifies the mandate of the CSC as the central personnel agency of the Government. Under this provision, the
CSC has the power to promulgate rules and regulations such as the CSEE, through the CESB.
Ø In this case, the petitioners did not possess the required CSEE despite their insistence on having such eligibility.
Thus, the rules and regulations of the CESB in acquiring the eligibility should be observed and complied with.
Ø *OPTIONAL ADDITIONAL INFO: It is also noteworthy that the court affirmed the CSC’s original
jurisdiction over the cases of the petitioners. It held that the power and function to hear and decide administrative
cases on all personnel and civil service matters remains to be duty and function of the CSC, in accordance with the
Constitution, under EO No. 292 (The Administrative Code of 1987).

Career Executive Service Board vs Civil Service Commission, et.al., GR No. 196890, 11 January 2018
Ø Blesilda Lodevico (Lodevico) was appointed by then President Gloria Macapagal-Arroyo on May 14, 2008 as
Director III, Recruitment and Career Development Service, CESB.
Ø Lodevico possesses a Career Service Executive Eligibility since November 29, 2001, as evidenced by the
Certificate of Eligibility issued by the CSC.
Ø June 30, 2010: Office of the President (OP) issued Memorandum Circular 1 (MC) which declared all non-career
executive service positions vacant. J
Ø July 16, 2010: OP promulgated the Implementing Guidelines of MC 1, which states that all non-Career Executive
Service Officers (nonCESO) in all agencies of the Executive Branch shall remain in office and continue to
perform their duties until July 31, 2010 or until their resignations have been accepted and/or their replacements
have been appointed or designated, whichever comes first.
Ø Pursuant to MC 1, Abesamis of CESB issued a memorandum informing Lodevico that she shall only remain in
office until July 31, 2010.
Ø Lodevico filed her appeal on the memorandum issued by Abesamis before the CSC.
Ø CSC ruled in favor of Leodevico and declared the memorandum null and void.
Ø Career Executive Service board filed an MR but it was denied. Hence, this petition for certiorari under Rule 62.
Respondents aver that the petitioners resorted to a wrong mode of appeal as Rule 43 is the proper remedy.
Is the dismissal of Lodevico as Director III, Recruitment and Career Development Services from the CESB,
proper? YES

a) What are the requirements for employees in the CES (Career Executive Service) to acquire security of
tenure?
As clearly set forth in the foregoing provisions, two requisites must concur in order that an employee in the career
executive service may attain security of tenure, to wit:
a) CES eligibility; and
b) Appointment to the appropriate CES rank

In sum, for an employee to attain a permanent status in his employment, he must first be a CES eligible. Such
eligibility can be acquired by passing the requisite civil service examinations and obtaining passing grade to the
same.36 "At present, the CES eligibility examination process has four stages, namely: (1) Written Examination; (2)
Assessment Center; (3) Performance Validation; and (4) Board Interview."37 After completing and passing the
examination process, said employee is entitled to conferment of a CES eligibility and the inclusion of his name in the
roster of CES eligibles. Such conferment of eligibility is done by the CESB through a formal Board Resolution after
an evaluation is done of the employee's performance in the four stages of the CES eligibility examinations.

Ø Here, Lodevico was appointed as Director III as evidenced by a Letter42 dated May 14, 2008. The position of
Director III, equivalent to Assistant Bureau Director, is considered as a Career Executive Service position,
belonging to the third-level. Lodevico met the first requisite as she is a CES eligible, evidenced by a Certificate of
Eligibility.43 However, the second requisite is wanting because there was no evidence which proves that
Lodevico was appointed to a CES rank.
Ø Guilty of repetition, being CES eligible alone does not qualify her appointment as a permanent one, for there is a
necessity for her appointment to an appropriate CES rank to attain security of tenure.
Ø That being said, We consider Lodevico's appointment as mere temporary. Such being the case, her services may
be terminated with or without cause as she merely serves at the pleasure of the appointing authority. "[T]he
temporary appointee accepts the position with the condition that he shall surrender the office when called upon to
do so by the appointing authority."44 Consequently, her removal from service based on MC Nos. 1 and 2, which
discharged all non-CESO occupying CES positions in all agencies, was proper.
Ø Thus, petitioners are correct in stating that mere appointment of Lodevico as Director III and her CES eligibility
do not automatically mean that her appointment becomes a permanent one. It is necessary that she be appointed
in an appropriate CES rank to convert her temporary appointment into a permanent one.

positions in the civil service into career and non-career, to wit:

The career service is characterized by (1) entrance based on merit and fitness to be determined as far
as practicable by competitive examinations, or based on highly technical qualifications; (2)
opportunity for advancement to higher career positions; and (3) security of tenure; while a non-career
position is characterized by (1) entrance on bases other than those of the usual tests of merit and
fitness utilized for the career service; and (2) tenure which is limited to a period specified by law, or
which is coterminous with that of the appointing authority or subject to his pleasure, or limited to the
duration of a particular project for which purpose employment was extended.

three levels of positions in the career service, namely: (a) the first level shall include clerical, trades, crafts and
custodial service positions which involve non-professional or sub-professional work in a non supervisory or
supervisory capacity requiring less than four years of collegiate studies; (b) the second level shall include professional,
technical, and scientific positions which involve professional, technical or scientific work in a non-supervisory or
supervisory capacity requiring at least four years of college work up to Division Chief level; and (c) the third level
shall cover positions in the Career Executive Service.32

Under the third level, such positions in the Career Executive Service are further classified into Undersecretary,
Assistant Secretary, Bureau Director, Assistant Bureau Director, Regional Director, Assistant Regional Director,
Chief of Department Service and other officers of equivalent rank as may be identified by the Career Executive
Service Board, all of whom are appointed by the President.

ON EMPLOYER-EMPLOYEE RELATIONS
Bishop Shinji Amari vs Ricardo Villaflor, Jr., GR No. 224521, 17 February 2020
a) When a missionary is appointed as instructor of the Church’s own educational institution, is he deemed an
employee?
b) Does his dismissal involve an ecclesiastical affair?

Pedro Dusol and Maricel Dusol vs Emmarck Lazo, owner of Ralco Beach
a) Were the caretaker and store manager considered as industrial partners
and not employees?
b) Did their receipt of share in the profits of the business establish the
existence of a partnership?
Albert del Rosario et al vs ABS-CBN Broadcasting Corp., GR Nos. 202481, 202495,
202497,etc., 08 September 2020
a) Were the workers talents or employees of ABS-CBN?
Henry Paragele et al vs GMA Network, Inc., GR No. 235315, 13 July 2020
a) Are the camera men whom the network claims to have been hired as
pinch-hitters or relievers deemed employees of the latter?
Leonarda Salabe vs Social Security Commission et al, GR No.223018, 27 AUGUST
2020
a) May an employer-employee relationship be established through
testimonial evidence sans any documentary evidence?
b) Is the act of registering a worker under the SSS an acknowledgment of the
employer-employee relationship between them?
Maricalum Mining Corp. vs Florentino, GR Nos, 221813 & 222723, 23 July 2018
a) What are the different tests of employer-employee relations?
b) Does an employment relationship exist between a physician and a hospital?
Arnulfo Fernandez vs Kalookan Slaughterhouse, Inc., GR 225075, 19 June 2019
a) Is there an employer-employee relationship that is established when
slaughterhouses hire butchers on a contractual or per piece basis?
Marsman & Company vs Rodil Sta. Maria, GR 194765, 23 April 2018
a) Is Sta. Rita correct in asserting that Marsan remained his employer even after the
corporate spin-off?
Hijo Resources Corp vs Mejares et al, GR 20896, 13 January 2016
a) Is the declaration of the Med-Arbiter on the non-existence of employer-employee
relations binding on the Labor Arbiter in a subsequent case of illegal dismissal?
In the succeeding cases, determine whether or not employer-employee relations exist:
o American Power Conversion Corp et al vs Lim, GR 214291, 11January 2018
o
Valencia vs, Classique Vinyl Products Corp, GR 296390, 30 January 2017
o
Nestle Philippines vs Puedan, GR 220617, 30 January 2017
o Alba vs Espinosa, GR 227734, 09 August 2017
o South Cotabato Communications Corp vs Sto. Tomas, GR 2175, 15 June 2016
ON CONTRACTING AND SUB-CONTRACTING
Monsanto Philippines, Inc. vs NLRC, et al., GR No. 230609, 27 August 2020
a) What is the effect of non-registration with the DOLE of East Star at the time
of execution of the Service Agreement?
b) With a P10,000,000 subscribed capital stated in the Articles of
Incorporation, did East Star have substantial capital or investment to
qualify as a legitimate contractor?
Alaska Milk Corp vs Paez, GR 237277 & 237317, 27 November 2019
a)
Are Asiapro and 5S legitimate contractors?
b)
What is the effect of lack of registration with the DOLE?
c)
What is the effect of registering with the DOLE Regional Office outside of the place
where the contractor principally operates?
Allied Banking Corporation vs Reynold Calumpang, GR 219435, 17 January 2018
a) What are the distinctions between permissible job contracting and labor-only
contracting?
b) As between the bank and the janitorial and manpower services, who is the
employer?
In the following cases, ascertain whether or not there is legitimate contracting, and the
consequent relations of the workers with the contractors and principals, as well as their rights
and obligations.
o RNB Garments Philippines, Inc. vs Ramrol Multi-Purpose Cooperative, et al., GR
No. 236331, 14 September 2020
o Mago et al vs Sun Power Manufacturing Ltd., GR 210961, 24 January 2018
o San Miguel Foods vs Rivera, GR 220103, 31 January 2018
o
Lingnam Restaurant vs Skills & Talent Employment Pool, Inc. et al, GR 214667, 03
December 2018
o Philippine Pizza, Inc vs Cayetano et al, GR No. 230030, 29 August 2018
ON REGULAR EMPLOYMENT AND OTHER KINDS OF EMPLOYMENT
Mario Abuda vs Natividad Poultry Farms, GR 200712, 04 July 2018
a) What is the primary test in determining regular employment?
b) Are the maintenance personnel hired on a pakyaw basis about once or thrice a
year to perform repair or maintenance considered as regular employees of the
poultry farm owner?
Geraldo vs The Bill Sender Corp, GR 222219, 03 October 2018
a) Does payment of compensation by piece-rate define the employment status?
Umali vs Hobbywing Solutions, Inc., GR 221356, 14 March 2018
a) What is the effect of the extension of a probationary employment contract on the
worker’s employment status?
Lingat et al vs Coca-cola Bottlers Philippines, Inc. et al, GR 205688, 04 July 2018
a) Are workers engaged under a Warehousing Management Agreement between
CCBPI and an agency, considered as regular employees of the former?
Lu vs Enopia, et al GR 197899, 06 March 2017
a) Are the crew members of a fishing boat hired under an income-sharing
arrangement with additional backing incentive considered regular employees of
the boat owner?
Salvador Inocentes, et al., vs R. Syjuco Construction, Inc., et al., GR 240549, 27 August
2020
Innodata Knowledge Services, Inc. vs Inting et al, GR No. 211892, 06 December 2017
a) When project employees are assigned to do another project outside of the
original contract, can they successfully claim regularization of employment
status?

Pacific Metals Co., Ltd. Vs Tamayo, GR 226920, 05 December 2019

a) Is the existence of an employment contract conclusive of the nature of one’s
employment?
b) When workers work on projects that are time-bound, are they automatically
characterized as project employees?
c) May a project or work pool employee acquire regular employment status?

FACTS OF THE CASE

PAMCO is a foreign company engaged in the importation of nickel ore mined in the Philippines. Saprolite Ore refers
to nickel ore suitable for smelting into ferronickel, the main raw material for production of stainless steel which is now
widely used in manufacturing kitchen equipment etc. PAMCO is registered in Japan and opened a Philippine
Representative office in April 2008. Chitaru Okamura is PAMCO’s general manager and liaison officer for its
Philippine Office.

PAMCO negotiated to enter into an exploration agreement with ERAMEN minerals for the development of a target
area covered by the Latter’s Mineral production and Sharing Agreement. ERAMEN is the exclusive contractor
operating under MPSA no. 209-2005-III, registered with the DENR. PAMCO’s target area is within the area covered
by ERAMEN’s MPSA which covered 4, 619 hectares of land in Sta.Cruz and Candelaria, Zambales. Eramen was
represented by its president Enrique Fernandez.

PAMCO engaged the services of Edgar Allan Tamayo, a licensed a registered geologist. Tamayo signed up for a two
month employment contract commencing on September 2010, which was initially extended for another 2 months until
January 31, 2011.

The undertaking between the two, is that PAMCO shall provide financial and technical assistance to ERAMEN in the
exploration project while PAMCO shall have the exclusive option to participate in the subsequent mining project for
the purpose of purchasing saprolite ore which had been identified and exploited in the target area.

Tamayo was designated manager for the ERAMEN/ PAMCO exploration project. AS such he was in charge of
preparing the project reports and updates and budget request for the approval of Fernandez. There is no showing
however that Tamayo’s engagement with the ERAMEN PAMCO PROJECT was covered by an employment contract.

On November 29, 2011, Tamayo was informed that his services as an exploration manager was terminated
effective, December 31, 2011 in view of the completion of the exploration aspect of the project. Tamayo sent an email
with an allegation that he was terminated because of connivance among some technical people involved in the
exploration project and the group from UP allegedly ganged up on him. And he informed the two companies that he
would file a case with the NLRC unless his demands will be granted. On dec. 12, 2012, her filed a complaint for
illegal dismissal against PAMCO and eramen.

Tamayo argued that he was a regular employee of PAMCO and/or of the ERAMEN/PAMCO Exploration Project,
having rendered work directly related, nay, necessary and desirable, to the main business of the company and
the exploration project. He should not be considered a project employee because the duration of his
employment was not determined at the time of his engagement and his termination had not been reported to the
Department of Labor and Employment (DOLE) in accordance with law.
Being a regular employee, Tamayo claimed security of tenure. Termination of his employment, without valid or
authorized cause, violated his security of tenure. Both PAMCO and ERAMEN should be held liable for his
backwages, separation pay, 13th month pay, moral and exemplary damages, and attorney's fees.

ISSUE: WHETHER OR NOT Private respondent was illegally dismissed

RULING: YES, The court held in the affirmative.

The extension made by PAMCO, without determining a fixed period of employment, a continuous employment with a
nature of such as deemed necessary and important in the business operation of the employer, is deemed to have been
regularized by the extension of the contract.

E. Ganzon, Inc vs Ando, GR 214183, 20 February 2017

a) Is the opinion of the appellate court correct that the stipulation in a project
employment contract either extending or shortening the project worker’s services
depending on the work phasing runs counter to the very essence of project
employment?
Quebral vs Angbus Construction, Inc., 07 November 2016
a) What are the indicators of project employment?
b) Are the construction workers hired on various dates to perform tasks necessary
and desirable to the business of Angbus Construction, Inc. deemed to be regular
employees?
Minsola vs New City Builders, Inc. et al, GR No. 207613, 31 January 2018
Inocentes et al vs R Syjuco Construction, Inc, GR 237020, 29 July 2019
Bajaro vs Metro Stonerich Corp et al, GR No. 227982
a) Based on the tests and indicators of project employment, are the workers in these
cases considered as project employees?
Zenaida Paz vs Northern Tobacco Redrying Co., Inc., 18 February, 2015
Universal Robina Sugar Milling Corp vs Acibo, GR 186439, 15 January 2015
Hacienda Cataywa vs Lorenzo, GR 179640, 18 March 2015
a)
May a seasonal employee acquire regular employment status?
b)
If so, how is the computation of his retirement pay? Separation pay?
c)
Are regular seasonal employees entitled to benefit from the CBA between
management and regular rank-and-file employees?
d) May hacienda workers whose work is seasonal attain regular employment status?
Claret School of Quezon City vs Madelyn Sinday, GR 226358, 09 October 2019
a)
What are the criteria under which fixed-term employment cannot be deemed in
contravention of the right to security of tenure?
b)
What is the rationale behind these safeguards/criteria?
c)
Does the existence of a contract indicating a fixed-term preclude regular
employment?
d)
How should the freedom to contract principle under the Civil Code be interpreted
when applied to labor contracts?
Aliling vs Feliciano, GR 185829, 25 April 2012
Abbot Laboratories vs Alcaraz, GR 192571, 22 April 2014
PNOC-Energy Development vs Buenviaje, GR 183200-01, 29 June 2016
Enchanted Kingdom vs Verzo, GR 209559, 09 December 2015
University of St. La salle vs Josephine Glaraga, et al., GR No. 224170, 10 June 2020
Redentor Agustin vs Alphaland Corporation, GR No. 218282, 09 September 2020
a)
What are the requisites for a valid probationary employment?
b)
What is the effect of failure to communicate to the employee at the time
of engagement of the standards of work performance?
c)
In the cases of Aliling and Abbot Laboratories, there were no standards of
work performance that were duly communicated to the employees. In
Aliling, the work quota was communicated more than a month from his
appointment, while in Abbott Laboratories, Alcaraz was apprised of her job
description, duties and responsibilities upon hiring. How do you explain the
variance in the ruling of the Supreme Court on their employment
status/classification?
d)
In the cases of Aliling and Enchanted Kingdom, they were not apprised of
work standards for regularization at the time of engagement. How do you
explain the decision of the Supreme Court approving regular employment
in Aliling, while upholding probationary employment in Enchanted
Kingdom?
e)
May a probationary employment contract be terminated even prior to the
agreed period of probation?
f)
What are the grounds for validly terminating a probationary employment
contract?
g)
In case of illegal dismissal, how should the award of full backwages be
computed?