Anda di halaman 1dari 31

LABOR CONGRESS OF THE PHILIPPINES VS.

NLRC
290 SCRA 509 , MAY 21, 1998

HELD:
Labor Law; Dismissals; Abandonment; Burden of proving the existence of just cause for
dismissing an employee, such as abandonment, rests on the employer.It may likewise be
stressed that the burden of proving the existence of just cause for dismissing an employee,
such as abandonment, rests on the employer, a burden private respondents failed to discharge.

Same; Same; Private respondents violated the rights of petitioners to security of tenure
and constitutional right to due process in not even serving them with a written notice of such
termination.Private respondents, moreover, in considering petitioners employment to have
been terminated by abandonment, violated their rights to security of tenure and constitutional
right to due process in not even serving them with a written notice of such termination. Section
2, Rule XIV, Book V of the Omnibus Rules Implementing the Labor Code provides: SEC.
2. Notice of Dismissal.Any employer who seeks to dismiss a worker shall furnish him a written
notice stating the particular acts or omission constituting the grounds for his dismissal. In cases
of abandonment of work, the notice shall be served at the workers last known address.

Same; Same; Benefits; Petitioners are therefore entitled to reinstatement with full
backwages pursuant to Article 279 of the Labor Code, as amended by R.A. No. 6715.
Petitioners are therefore entitled to reinstatement with full back wages pursuant to Article 279
of the Labor Code, as amended by R.A. No. 6715. Nevertheless, the records disclose that taking
into account the number of employees involved, the length of time that has lapsed since their
dismissal, and the perceptible resentment and enmity between petitioners and private
respondents which necessarily strained their relationship, reinstatement would be impractical
and hardly promotive of the best interests of the parties. In lieu of reinstatement then,
separation pay at the rate of one month for every year of service, with a fraction of at least six
(6) months of service considered as one (1) year, is in order.

Same; Same; Same; While petitioners mode of compensation was on a per piece basis
the status and nature of their employment was that of regular employees.As to the other
benefits, namely, holiday pay, premium pay, 13th month pay and service incentive leave which
the labor arbiter failed to rule on but which petitioners prayed for in their complaint, we hold
that petitioners are so entitled to these benefits. Three (3) factors lead us to conclude that
petitioners, although piece-rate workers, were regular employees of private respondents. First,
as to the nature of petitioners tasks, their job of repacking snack food was necessary or
desirable in the usual business of private respondents, who were engaged in the manufacture
and selling of such food products; second, petitioners worked for private respondents
throughout the year, their employment not having been dependent on a specific project or
season; and third, the length of time that petitioners worked for private respondents. Thus,
while petitioners mode of compensation was on a per piece basis, the status and nature of
their employment was that of regular employees.

Same; Same; Same; Petitioners are beyond the ambit of exempted persons and are
therefore entitled to overtime pay.As to overtime pay, the rules, however, are different.
According to Sec. 2(e), Rule I, Book III of the Implementing Rules, workers who are paid by
results including those who are paid on piece-work, takay, pakiao, or task basis, if their output
rates are in accordance with the standards prescribed under Sec. 8, Rule VII, Book III, of these
regulations, or where such rates have been fixed by the Secretary of Labor in accordance with
the aforesaid section, are not entitled to receive overtime pay. Here, private respondents did
not allege adherence to the standards set forth in Sec. 8 nor with the rates prescribed by the
Secretary of Labor. As such, petitioners are beyond the ambit of exempted persons and are
therefore entitled to overtime pay. Once more, the National Labor Relations Commission would
be in a better position to determine the exact amounts owed petitioners, if any.

PNCC SKYWAY TRAFFIC MANAGEMENT AND SECURITY DIVISION WORKERS


ORGANIZATION (PSTMSDWO) VS. PNCC SKYWAY CORPORATION
613 SCRA 28 , FEBRUARY 17, 2010

HELD:
Labor Law; Collective Bargaining Agreements; Interpretation of Contracts; The rule
is that where the language of a contract is plain and unambiguous, its meaning should
be determined without reference to extrinsic facts or aids.The rule is that where the
language of a contract is plain and unambiguous, its meaning should be determined
without reference to extrinsic facts or aids. The intention of the parties must be
gathered from that language, and from that language alone. Stated differently, where
the language of a written contract is clear and unambiguous, the contract must be
taken to mean that which, on its face, it purports to mean, unless some good reason
can be assigned to show that the words used should be understood in a different sense.

Same; Same; Same; In fine, the Collective Bargaining Agreement (CBA) must be
strictly adhered to and respected if its ends have to be achieved, being the law between
the parties.In the case at bar, the contested provision of the CBA is clear and
unequivocal. Article VIII, Section 1 (b) of the CBA categorically provides that the
scheduling of vacation leave shall be under the option of the employer. The preference
requested by the employees is not controlling because respondent retains its power and
prerogative to consider or to ignore said request. Thus, if the terms of a CBA are clear
and leave no doubt upon the intention of the contracting parties, the literal meaning of
its stipulation shall prevail. In fine, the CBA must be strictly adhered to and respected if
its ends have to be achieved, being the law between the parties. In Faculty Association
of Mapua Institute of Technology (FAMIT) v. Court of Appeals, 524 SCRA 709 (2007),
this Court held that the CBA during its lifetime binds all the parties. The provisions of
the CBA must be respected since its terms and conditions constitute the law between
the parties. The parties cannot be allowed to change the terms they agreed upon on
the ground that the same are not favorable to them.

Same; Same; Vacation Leaves; Management Prerogatives; In the grant of vacation


leave privileges to an employee, the employer is given the leeway to impose conditions
on the entitlement to and commutation of the same, as the grant of vacation leave is
not a standard of law, but a prerogative of management.The multitude or scarcity of
personnel manning the tollways should not rest upon the option of the employees, as
the public using the skyway system should be assured of its safety, security and
convenience. Although the preferred vacation leave schedule of petitioners members
should be given priority, they cannot demand, as a matter of right, that their request be
automatically granted by the respondent. If the petitioners were given the exclusive
right to schedule their vacation leave then said right should have been incorporated in
the CBA. In the absence of such right and in view of the mandatory provision in the
CBA giving respondent the right to schedule the vacation leave of its employees,
compliance therewith is mandated by law. In the grant of vacation leave privileges to
an employee, the employer is given the leeway to impose conditions on the entitlement
to and commutation of the same, as the grant of vacation leave is not a standard of
law, but a prerogative of management. It is a mere concession or act of grace of the
employer and not a matter of right on the part of the employee. 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.

Same; Same; Same; Same; Since the grant of vacation leave is a prerogative of the
employer, the latter can compel its employees to exhaust all their vacation leave
credits.Along that line, since the grant of vacation leave is a prerogative of the
employer, the latter can compel its employees to exhaust all their vacation leave
credits. Of course, any vacation leave credits left unscheduled by the employer, or any
scheduled vacation leave that was not enjoyed by the employee upon the employers
directive, due to exigencies of the service, must be converted to cash, as provided in
the CBA. However, it is incorrect to award payment of the cash equivalent of vacation
leaves that were already used and enjoyed by the employees. By directing the
conversion to cash of all utilized and paid vacation leaves, the voluntary arbitrator has
licensed unjust enrichment in favor of the petitioner and caused undue financial burden
on the respondent. Evidently, the Court cannot tolerate this.

Same; Same; Same; The purpose of a vacation leave is to afford a laborer a


chance to get a much-needed rest to replenish his worn-out energy and acquire a new
vitality to enable him to efficiently perform his duties, and not merely to give him
additional salary and bountyto give the employees the option not to consume it with
the aim of converting it to cash at the end of the year would defeat the very purpose of
vacation leave.It would seem that petitioners goal in relentlessly arguing that its
members preferred vacation leave schedule should be given preference is not allowed
to them to avail themselves of their respective vacation leave credits at all but, instead,
to convert these into cash. In Cuajo v. Chua Lo Tan, 6 SCRA 136 (1962) We said that
the purpose of a vacation leave is to afford a laborer a chance to get a much-needed
rest to replenish his worn-out energy and acquire a new vitality to enable him to
efficiently perform his duties, and not merely to give him additional salary and bounty.
Accordingly, the vacation leave privilege was not intended to serve as additional salary,
but as a non-monetary benefit. To give the employees the option not to consume it
with the aim of converting it to cash at the end of the year would defeat the very
purpose of vacation leave.
Same; Same; The supremacy of the law over contracts is explained by the fact that
labor contracts are not ordinary contractsthey are imbued with public interest and
therefore are subject to the police power of the state; If the provisions in the CBA run
contrary to law, public morals, or public policy, such provisions may very well be
voided.The relations between capital and labor are not merely contractual. They are
so impressed with public interest that labor contracts must yield to the common good x
x x. The supremacy of the law over contracts is explained by the fact that labor
contracts are not ordinary contracts; they are imbued with public interest and therefore
are subject to the police power of the state. However, it should not be taken to mean
that provisions agreed upon in the CBA are absolutely beyond the ambit of judicial
review and nullification. If the provisions in the CBA run contrary to law, public morals,
or public policy, such provisions may very well be voided.

Same; Same; Security Guards; Since it is the primary responsibility of operators of


company security forces to maintain and upgrade the standards of efficiency, discipline,
performance and competence of their personnel, it follows that the expenses to be
incurred therein shall be for the personal account of the company.Since it is the
primary responsibility of operators of company security forces to maintain and upgrade
the standards of efficiency, discipline, performance and competence of their personnel,
it follows that the expenses to be incurred therein shall be for the personal account of
the company. Further, the intent of the law to impose upon the employer the obligation
to pay for the cost of its employees training is manifested in the aforementioned laws
provision that Where the quality of training is better served by centralization, the CFSD
Directors may activate a training staff from local talents to assist. The cost of training
shall be pro-rated among the participating agencies/
private companies. It can be gleaned from the said provision that cost of training shall
be pro-rated among participating agencies and companies if the training is best served
by centralization. The law mandates pro-rating of expenses because it would be
impracticable and unfair to impose the burden of expenses suffered by all participants
on only one participating agency or company. Thus, it follows that if there is no
centralization, there can be no pro-rating, and the company that has its own security
forces shall shoulder the entire cost for such training. If the intent of the law were to
impose upon individual employees the cost of training, the provision on the pro-rating
of expenses would not have found print in the law.
PHILIPPINE TELEGRAPH AND TELEPHONE COMPANY VS. NLRC
272 SCRA 596 , MAY 23, 1997

HELD:

Labor Law; Dismissals; Petitioners policy of not accepting or considering as


disqualified from work any woman worker who contracts marriage runs afoul of the test of,
and the right against discrimination afforded all women workers by our labor laws and by
no less than the Constitution.In the case at bar, petitioners policy of not accepting or
considering as disqualified from work any woman worker who contracts marriage runs
afoul of the test of, and the right against, discrimination, afforded all women workers by
our labor laws and by no less than the Constitution. Contrary to peti-tioners as sertion that
it dismissed private respondent from employment on account of her dishonesty, the record
discloses clearly that her ties with the company were dissolved principally because of the
companys policy that married women are not qualified for employment in PT&T, and not
merely because of her supposed acts of dishonesty.

Same; Same; While loss of confidence is a just cause for termination of employment, it
should not be simulated.Verily, private respondents act of concealing the true nature of
her status from PT&T could not be properly characterized as willful or in bad faith as s he
was m oved to act the way she did mainly because she wanted to retain a permanent job in
a stable company. In other words, she was practically forced by that very same illegal
company policy into misrepresenting her civil status for fear of being disqualified from
work. While loss of confidence is a just cause for termination of employment, it should not
be simulated. It must rest on an actual breach of duty committed by the employee and not
on the employers caprices. Furthermore, it should never be used as a subterfuge for causes
which are improper, illegal, or unjustified.

Same; Same; The primary standard of determining regular employment is the


reasonable connection between the activity performed by the employee in relation to the
business or trade of the employer.Private respondent, it mus t be observed, had gained
regular status at the time of her dismissal. When she was served her walking papers on
January 29, 1992, she was about to complete the probationary period of 150 days as she
was contracted as a probationary employee on September 2, 1991. That her dismissal would
be effected just when her probationary period was winding down clearly raises the plausible
conclusion that it was done in order to prevent her from earning security of tenure. On the
other hand, her earlier stints with the company as reliever were undoubtedly those of a
regular employee, even if the same were for fixed periods, as she performed activities which
were essential or necessary in the usual trade and business of PT&T. The primary standard
of determining regular employment is the reasonable connection between the activity
performed by the employee in relation to the busines s or trade of the employer.

Same; Same; Policy of Philippine Air Lines requiring that prospective flight attendants
must be single and that they will be automatically separated from the service once they
marry declared void in Zialcita, et al. v. Philippine Air Lines.It would be worthwhile to
reflect upon and adopt here the rationalization in Zialcita, et al. vs. Philippine Air Lines, a
decision that emanated from the Office of the President. There, a policy of Philippine Air
Lines requiring that prospective flight attendants must be single and that they will be
automatically s eparated from the service once they marry was declared void, it being
violative of the clear mandate in Article 136 of the Labor Code with regard to
discrimination against married women.
Same; Same; While it is true that the parties to a contract may establish any
agreements, terms and conditions that they may deem convenient, the same should not be
contrary to law, morals, good customs, public order or public policy.Petitioners policy is
not only in derogation of the provisions of Article 136 of the Labor Code on the right of a
woman to be free from any kind of stipulation against marriage in connection with her
employment, but it likewise assaults good morals and public policy, tending as it does to
deprive a woman of the freedom to choose her status, a privilege that by all accounts
inheres in the individual as an intangible and inalienable right. Hence, while it is true that
the parties to a contract may estallish any agreements, terms, and conditions that they may
deem convenient, the same should not be contrary to law, morals, good customs, public
order, or public policy. Carried to its logical consequences, it may even be said that
petitioners policy against legitimate marital bonds would encourage illicit or common-law
relations and subvert the sacrament of marriage.

Same; Same; The relations between capital and labor are not merely contractual,
impressed as they are with so much public interest that the same should yield to the comm
on good.Parenthetically, the Civil Code provisions on the contract of labor state that the
relations between the parties, that is, of capital and labor, are not merely contractual,
impressed as they are with so much public interest that the same should yield to the
common good. It goes on to intone that neither capital nor labor should visit acts of
oppression against the other, nor impair the interest or convenience of the public. In the
final reckoning, the danger of just such a policy against marriage followed by petitioner
PT&T is that it strikes at the very essence, ideals and purpose of marriage as an inviolable
social institution and, ultimately, of the family as the foundation of the nation. That it must
be effectively interdicted here in all its indirect, disguised or dissembled forms as
discriminatory conduct derogatory of the laws of the land is not only in order but
imperatively required.

PAGE 34

DE LEON VS. NATIONAL LABOR RELATIONS COMMISSION


176 SCRA 615 , AUGUST 21, 1989

HELD:
Labor Relations; Employer-Employee Relationship; Regular Employment; When the
activities performed by the employee are usually necessary or desirable in the usual
business or trade of the employer, the employment is deemed regular notwithstanding
contrary agreements.Thus, contrary agreements notwithstanding, an employment is
deemed regular when the activities performed by the employee are usually necessary or
desirable in the usual business or trade of the employer. Not considered regular are the
so-called project employment the completion or termination of which is more or less
determinable at the time of employment, such as those employed in connection with a
particular construction project, and seasonal employment which by its nature is only
desirable for a limited period of time. However, any employee who has rendered at
least one year of service, whether continuous or intermittent, is deemed regular with
respect to the activity he performed and while such activity actually exists.

Same; Same; Same; Determination of whether employment is casual or regular


does not depend on the will or word of the employer, and the procedure for hiring and
manner of paying, but on the nature of the activities performed by the employee, and
to some extent, the length of performance, and its continued existence.Furthermore,
the petitioner performed his work of painting and maintenance activities during his
employment in respondents business which lasted for more than one year, until early
January, 1983 when he demanded to be regularized and was subsequently dismissed.
Certainly, by this fact alone he is entitled by law to be considered a regular employee.
And considering further that weeks after his dismissal, petitioner was rehired by the
company through a labor agency and was returned to his post in the Maintenance
Section and made to perform the same activities that he used to do, it cannot be denied
that his activities as a regular painter and maintenance man still exist. It is of no
moment that petitioner was told when he was hired that his employment would only be
casual, that he was paid through cash vouchers, and that he did not comply with
regular employment procedure. Precisely, the law overrides such conditions which are
prejudicial to the interest of the worker whose weak bargaining position needs the
support of the State. What determines whether a certain employment is regular or
casual is not the will and word of the employer, to which the desperate worker often
accedes, much less the procedure of hiring the employee or the manner of paying his
salary. It is the nature of the activities performed in relation to the particular business
or trade considering all circumstances, and in some cases the length of time of its
performance and its continued existence.

PRICE VS. INNODATA PHILS., INC.


567 SCRA 269 , SEPTEMBER 30, 2008

HELD:

Labor Law; Regular Employees; Fixed-Term Employment; The employment status


of a person is defined and prescribed by law and not by what the parties say it should
be.After a painstaking review of the arguments and evidences of the parties, the
Court finds merit in the present Petition. There were no valid fixed-term contracts and
petitioners were regular employees of the INNODATA who could not be dismissed
except for just or authorized cause. The employment status of a person is defined and
prescribed by law and not by what the parties say it should be. Equally important to
consider is that a contract of employment is impressed with public interest such that
labor contracts must yield to the common good. Thus, provisions of applicable statutes
are deemed written into the contract, and the parties are not at liberty to insulate
themselves and their relationships from the impact of labor laws and regulations by
simply contracting with each other.

Same; Same; Same; The applicable test to determine whether an employment should
be considered regular or non-regular is the reasonable connection between the
particular activity performed by the employee in relation to the usual business or trade
of the employer.Under Article 280 of the Labor Code, the applicable test to determine
whether an employment should be considered regular or non-regular is the reasonable
connection between the particular activity performed by the employee in relation to the
usual business or trade of the employer. In the case at bar, petitioners were employed
by INNODATA on 17 February 1999 as formatters. The primary business of INNODATA
is data encoding, and the formatting of the data entered into the computers is an
essential part of the process of data encoding. Formatting organizes the data encoded,
making it easier to understand for the clients and/or the intended end users thereof.
Undeniably, the work performed by petitioners was necessary or desirable in the
business or trade of INNODATA.

Same; Same; Same; Under the Civil Code, fixed-term employment contracts are
not limited, as they are under the present Labor Code, to those by nature seasonal or
for specific projects with predetermined dates of completion; they also include those to
which the parties by free choice have assigned a specific date of terminationthe
decisive determinant in term employment is the day certain agreed upon by the parties
for the commencement and termination of their employment relationship, a day certain
being understood to be that which must necessarily come, although it may not be
known when.It is also true that while certain forms of employment require the
performance of usual or desirable functions and exceed one year, these do not
necessarily result in regular employment under Article 280 of the Labor Code. Under the
Civil Code, fixed-term employment contracts are not limited, as they are under the
present Labor Code, to those by nature seasonal or for specific projects with
predetermined dates of completion; they also include those to which the parties by free
choice have assigned a specific date of termination. The decisive determinant in term
employment is the day certain agreed upon by the parties for the commencement and
termination of their employment relationship, a day certain being understood to be that
which must necessarily come, although it may not be known when. Seasonal
employment and employment for a particular project are instances of employment in
which a period, where not expressly set down, is necessarily implied.

Same; Same; Same; Fixed-term employment contracts are the exception rather
than the general rule.While this Court has recognized the validity of fixed-term
employment contracts, it has consistently held that this is the exception rather than the
general rule. More importantly, a fixed-term employment is valid only under certain
circumstances. In Brent, the very same case invoked by respondents, the Court
identified several circumstances wherein a fixed-term is anessential and natural
appurtenance, to wit: Some familiar examples may be cited of employment contracts
which may be neither for seasonal work nor for specific projects, but to which a fixed
term is an essential and natural appurtenance: overseas employment contracts, for one,
to which, whatever the nature of the engagement, the concept of regular employment
with all that it implies does not appear ever to have been applied, Article 280 of the
Labor Code notwithstanding; also appointments to the positions of dean, assistant
dean, college secretary, principal, and other administrative offices in educational
institutions, which are by practice or tradition rotated among the faculty members, and
where fixed terms are a necessity without which no reasonable rotation would be
possible. Similarly, despite the provisions of Article 280, Policy Instructions No. 8 of the
Minister of Labor implicitly recognize that certain company officials may be elected for
what would amount to fixed periods, at the expiration of which they would have to
stand down, in providing that these officials, x x may lose their jobs as president,
executive vice-president or vice president, etc. because the stockholders or the board of
directors for one reason or another did not reelect them.

Same; Same; Same; Contracts of Adhesion; Where a contract of employment,


being a contract of adhesion, is ambiguous, any ambiguity therein should be construed
strictly against the party who prepared it.Even assuming that petitioners length of
employment is material, given respondents muddled assertions, this Court adheres to
its pronouncement in Villanueva v. National Labor Relations Commission, 295 SCRA 326
(1998), to the effect that where a contract of employment, being a contract of
adhesion, is ambiguous, any ambiguity therein should be construed strictly against the
party who prepared it. The Court is, thus, compelled to conclude that petitioners
contracts of employment became effective on 16 February 1999, and that they were
already working continuously for INNODATA for a year.

Same; Same; Same; Project Employees; Words and Phrases; Project employees
are those workers hired (1) for a specific project or undertaking, and wherein (2) the
completion or termination of such project has been determined at the time of the
engagement of the employee.Further attempting to exonerate itself from any liability
for illegal dismissal, INNODATA contends that petitioners were project employees
whose employment ceased at the end of a specific project or undertaking. This
contention is specious and devoid of merit. In Philex Mining Corp. v. National Labor
Relations Commission, 312 SCRA 119 (1999), the Court defined project employees as
those workers hired (1) for a specific project or undertaking, and wherein (2) the
completion or termination of such project has been determined at the time of the
engagement of the employee.

Same; It is the policy of the State to assure the workers of security of tenure and
free them from the bondage of uncertainty of tenure woven by some employers into
their contracts of employment.Under Section 3, Article XVI of the Constitution, it is
the policy of the State to assure the workers of security of tenure and free them from
the bondage of uncertainty of tenure woven by some employers into their contracts of
employment. This was exactly the purpose of the legislators in drafting Article 280 of
the Labor Codeto prevent the circumvention by unscrupulous employers of the
employees right to be secure in his tenure by indiscriminately and completely ruling out
all written and oral agreements inconsistent with the concept of regular employment.

Same; Corporation Law; Unless they have exceeded their authority, corporate
officers are, as a general rule, not personally liable for their official acts, because a
corporation, by legal fiction, has a personality separate and distinct from its officers,
stockholders and members.Unless they have exceeded their authority, corporate
officers are, as a general rule, not personally liable for their official acts, because a
corporation, by legal fiction, has a personality separate and distinct from its officers,
stockholders and members. Although as an exception, corporate directors and officers
are solidarily held liable with the corporation, where terminations of employment are
done with malice or in bad faith, in the absence of evidence that they acted with malice
or bad faith herein, the Court exempts the individual respondents, Leo Rabang and Jane
Navarette, from any personal liability for the illegal dismissal of petitioners.

SAN MIGUEL CORP VS MALIKSI


G.R. NO 147566

PAGE 35

GADIA VS. SYKES ASIA, INC. 748


SCRA 633 , JANUARY 28, 2015

HELD:

Same; Same; Same; Same; Labor Law; In labor disputes, grave abuse of discretion
may be ascribed to the National Labor Relations Commission (NLRC) when, inter alia, its
findings and the conclusions reached thereby are not supported by substantial
evidence.In labor disputes, grave abuse of discretion may be ascribed to the NLRC
when, inter alia, its findings and the conclusions reached thereby are not supported by
substantial evidence. This requirement of substantial evidence is clearly expressed in
Section 5, Rule 133 of the Rules of Court which provides that in cases filed before
administrative or quasi-judicial bodies, a fact may be deemed established if it is
supported by substantial evidence, or that amount of relevant evidence which a
reasonable mind might accept as adequate to justify a conclusion.

Labor Law; Project Employees and Regular Employees, Distinguished.Article


294 of the Labor Code, as amended, distinguishes a project-based employee from a
regular employee as follows: Art. 294. Regular and casual employment.The provisions
of written agreement to the contrary notwithstanding and regardless of the oral
agreement of the parties, an employment shall be deemed to be regular where the
employee has been engaged to perform activities which are usually necessary or
desirable in the usual business or trade of the employer, except where the
employment has been fixed for a specific project or undertaking the
completion or termination of which has been determined at the time of the
engagement of the employee or where the work or services to be performed is
seasonal in nature and the employment is for the duration of the season. x x x x
(Emphasis and underscoring supplied) In Omni Hauling Services, Inc. v. Bon, 734 SCRA
270 (2014), the Court extensively discussed how to determine whether an employee
may be properly deemed project-based or regular, to wit: A project employee is
assigned to a project which begins and ends at determined or determinable
times. Unlike regular employees who may only be dismissed for just and/or authorized
causes under the Labor Code, the services of employees who are hired as
project[-based] employees may be lawfully terminated at the completion
of the project. According to jurisprudence, the principal test for determining
whether particular employees are properly characterised as project[-based]
employees as distinguished from regular employees, is whether or not the
employees were assigned to carry out a specific project or undertaking, the
duration (and scope) of which were specified at the time they were engaged
for that project. The project could either be (1) a particular job or undertaking that is
within the regular or usual business of the employer company, but which is distinct and
separate, and identifiable as such, from the other undertakings of the company; or (2)
a particular job or undertaking that is not within the regular business of the corporation.
In order to safeguard the rights of workers against the arbitrary use of the word
project to prevent employees from attaining a regular status, employers claiming that
their workers are project[-based] employees should not only prove that the duration
and scope of the employment was specified at the time they were engaged, but also,
that there was indeed a project.

BAGUIO COUNTRY CLUB CORPORATION VS. NLRC


206 SCRA 643 , FEBRUARY 28, 1992

HELD:

Labor Law; Regular and Casual Employee; Records reveal that private respondent
was repeatedly re-hired to perform tasks ranging from dishwashing and gardening
aside from performing maintenance work.In the case at bar, the petitioner
corporation, which is certified by the Ministry of Labor and Employment as an
entertainment service establishment, claims that private respondent was contracted
for a fixed and specific period. However, the records reveal that the private respondent
was repeatedly re-hired to perform tasks ranging from dishwashing and gardening,
aside from performing maintenance work.

Same; Same; Repeated rehiring and the continuing need for his services are
sufficient evidence of the necessity and indispensability of his service to the petitioners
business or trade.Such repeated rehiring and the continuing need for his service are
sufficient evidence of the necessity and indispensability of his service to the petitioners
business or trade.

Same; Same; Fact that private respondent performed the said tasks for more than
one year entitles him by law to be considered a regular employee.Furthermore, the
private respondent performed the said tasks which lasted for more than one year, until
early January, 1981 when he was terminated. Certainly, by this fact alone he is entitled
by law to be considered a regular employee.

Same; Same; Owing to private respondents length of service with the petitioner
corporation, he became a regular employee by operation of law, one year after he was
employed.Owing to private respondents length of service with the petitioner
corporation, he became a regular employee, by operation of law, one year after he was
employed. It is more in consonance with the intent and spirit of the law to rule that the
status of regular employment attaches to the casual employee on the day immediately
after the end of his first year of service. To rule otherwise is to impose a burden on the
employee which is not sanctioned by law.

Same; Same; Evidently, the employment contracts entered into by private


respondent with the petitioner have the purpose of circumventing the employees
security of tenure.It is of no moment that private respondent was told when he was
hired that his employment would only be on a day to day basis for a temporary period
and may be terminated at any time subject to the petitioners discretion. Precisely, the
law overrides such conditions which are prejudicial to the interest of the worker.
Evidently, the employment contracts entered into by private respondent with the
petitioner have the purpose of circumventing the employees security of tenure. The
Court therefore, rigorously disapproves said contracts which demonstrate a clear
attempt to exploit the employee and deprive him of the protection sanctioned by the
Labor Code.

Same; Same; What determines whether a certain employee is regular or casual is


the nature of the activities performed in relation to the particular business or trade
considering all circumstances and in some cases the length of time of its performance
and its continued existence.It is noteworthy that what determines whether a certain
employment is regular or casual is not the will and word of the employer, to which the
desperate worker often accedes. It is the nature of the activities performed in relation
to the particular business or trade considering all circumstances, and in some cases the
length of time of its performance and its continued existence.

PHILIPPINE DAILY INQUIRER, INC. VS. MAGTIBAY, JR.


528 SCRA 355 , JULY 27, 2007

HELD:
Labor Law; Security of Tenure; Probationary Employees; Dismissals; Within the
limited legal six-month probationary period, probationary employees are still entitled to
security tenure; Two Grounds for Terminating a Probationary Employee.Within the
limited legal six-month probationary period, probationary employees are still entitled to
security of tenure. It is expressly provided in the afore-quoted Article 281 that a
probationary employee may be terminated only on two grounds: (a) for just cause, or
(b) 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.

Same; Same; Same; Same; All employees, be they regular or probationary, are
expected to comply with company-imposed rules and regulations.It is on record that
Magtibay committed obstinate infractions of company rules and regulations, which in
turn constitute sufficient manifestations of his inadequacy to meet reasonable
employment norms. The suggestion that Magtibay ought to have been made to
understand during his briefing and orientation that he is expected to obey and comply
with company rules and regulations strains credulity for acceptance. The CAs
observation that nowhere can it be found in the list of Basic Responsibility and Specific
Duties and Responsibilities of respondent Magtibay that he has to abide by the duties,
rules and regulations that he has allegedly violated is a strained rationalization of an
unacceptable conduct of an employee. Common industry practice and ordinary human
experience do not support the CAs posture. All employees, be they regular or
probationary, are expected to comply with company-imposed rules and regulations, else
why establish them in the first place. Probationary employees unwilling to abide by such
rules have no right to expect, much less demand, permanent employment. We,
therefore find sufficient factual and legal basis, duly established by substantial
evidence, for PDI to legally terminate Magtibays probationary employment effective
upon the end of the 6-month probationary period.

ALILING VS. FELICIANO


671 SCRA 186 , APRIL 25, 2012

HELD:
Remedial Law; Civil Procedure; Appeals; An appeal, once accepted by the Supreme
Court, throws the entire case open to review, and that this Court has the authority to
review matters not specifically raised or assigned as error by the parties.We said as
much in Sociedad Europea de Financiacion, SA v. Court of Appeals, 193 SCRA 105
(1991), It is axiomatic that an appeal, once accepted by this Court, throws the entire
case open to review, and that this Court has the authority to review matters not
specifically raised or assigned as error by the parties, if their consideration is necessary
in arriving at a just resolution of the case.

Same; Same; Same; Labor Law; Findings of the Labor Arbiter, when affirmed by
the National Labor Relations Commission (NLRC) and the Court of Appeals, are binding
on the Supreme Court, unless patently erroneous.Settled is the rule that the
findings of the Labor Arbiter, when affirmed by the NLRC and the Court of
Appeals, are binding on the Supreme Court, unless patently erroneous. It is
not the function of the Supreme Court to analyze or weigh all over again the evidence
already considered in the proceedings below. The jurisdiction of this Court in a petition
for review on certiorari is limited to reviewing only errors of law, not of fact, unless the
factual findings being assailed are not supported by evidence on record or the
impugned judgment is based on a misapprehension of facts. The more
recent Peafrancia Tours and Travel Transport, Inc., v. Sarmiento, 634 SCRA 279
(2010), has reaffirmed the above ruling, to wit: Finally, the CA affirmed the ruling of the
NLRC and adopted as its own the latters factual findings. Long-established is the
doctrine that findings of fact of quasi-judicial bodies x x x are accorded respect, even
finality, if supported by substantial evidence. When passed upon and upheld by the CA,
they are binding and conclusive upon this Court and will not normally be
disturbed. Though this doctrine is not without exceptions, the Court finds that none are
applicable to the present case.

Labor Law; Termination of Employment; Gross Inefficiency; Gross inefficiency


falls within the purview of other causes analogous to the foregoing, this constitutes,
therefore, just cause to terminate an employee under Article 282 of the Labor Code.
Article 282 of the Labor Code considers any of the following acts or omission on the
part of the employee as just cause or ground for terminating employment: (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. (Emphasis supplied) In Lim v. National Labor Relations
Commission, 259 SCRA 485 (1996), the Court considered inefficiency as an analogous
just cause for termination of employment under Article 282 of the Labor Code: We
cannot but agree with PEPSI that gross inefficiency falls within the
purview of other causes analogous to the foregoing, this constitutes,
therefore, just cause to terminate an employee under Article 282 of the
Labor Code. One is analogous to another if it is susceptible of comparison with the
latter either in general or in some specific detail; or has a close relationship with the
latter. Gross inefficiency is closely related to gross neglect, for both involve specific
acts of omission on the part of the employee resulting in damage to the employer or to
his business. In Buiser vs. Leogardo, this Court ruled that failure to observed prescribed
standards to inefficiency may constitute just cause for dismissal.
Same; Same; Same; An employees failure to meet sales or work quotas falls under
the concept of gross inefficiency, which in turn is analogous to gross neglect of duty
that is a just cause for dismissal under Article 282 of the Code.In fine, an employees
failure to meet sales or work quotas falls under the concept of gross inefficiency, which
in turn is analogous to gross neglect of duty that is a just cause for dismissal under
Article 282 of the Code. However, in order for the quota imposed to be considered a
valid productivity standard and thereby validate a dismissal, managements prerogative
of fixing the quota must be exercised in good faith for the advancement of its interest.
The duty to prove good faith, however, rests with WWWEC as part of its burden to
show that the dismissal was for a just cause. WWWEC must show that such quota was
imposed in good faith.

Same; Termination of Employment; Probationary Employees; While probationary


employees do not enjoy permanent status, they enjoy the constitutional protection of
security of tenurethey can only be terminated for cause or when they otherwise fail to
meet the reasonable standards made known to them by the employer at the time of
their engagement.Employees must be reminded that while probationary employees
do not enjoy permanent status, they enjoy the constitutional protection of security of
tenure. They can only be terminated for cause or when they otherwise fail to meet the
reasonable standards made known to them by the employer at the time of their
engagement. Respondent WWWEC miserably failed to prove the termination of
petitioner was for a just cause nor was there substantial evidence to demonstrate the
standards were made known to the latter at the time of his engagement. Hence,
petitioners right to security of tenure was breached

Same; Same; To effect a legal dismissal, the employer must show not only a valid
ground therefor, but also that procedural due process has properly been observed.To
effect a legal dismissal, the employer must show not only a valid ground therefor, but
also that procedural due process has properly been observed. When the Labor Code
speaks of procedural due process, the reference is usually to the two (2)-written notice
rule envisaged in Section 2 (III), Rule XXIII, Book V of the Omnibus Rules
Implementing the Labor Code, which provides: Section 2. Standard of due process:
requirements of notice.In all cases of termination of employment, the following
standards of due process shall be substantially observed. I. For termination of
employment based on just causes as defined in Article 282 of the Code: (a) 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; (b) 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 (c) A written
notice [of] termination served on the employee indicating that upon due consideration
of all the circumstance, grounds have been established to justify his termination. In
case of termination, the foregoing notices shall be served on the employees last known
address.

Same; Same; Separation Pay; Backwages; The computation of separation pay in


lieu of reinstatement includes the period for which backwages were awarded.As the
CA correctly observed, To reinstate petitioner [Aliling] would only create an
atmosphere of antagonism and distrust, more so that he had only a short stint with
respondent company. The Court need not belabor the fact that the patent animosity
that had developed between employer and employee generated what may be
considered as the arbitrary dismissal of the petitioner. Following the pronouncements of
this Court Sagales v. Rustans Commercial Corporation, 572 SCRA 89 (2008), the
computation of separation pay in lieu of reinstatement includes the period for which
backwages were awarded: Thus, in lieu of reinstatement, it is but proper to award
petitioner separation pay computed at one-month salary for every year of
service, a fraction of at least six (6) months considered as one whole year. In
the computation of separation pay, the period where backwages are awarded
must be included. (Emphasis supplied.)
Thus, Aliling is entitled to both backwages and separation pay (in lieu of reinstatement)
in the amount of one (1) months salary for every year of service, that is, from June 11,
2004 (date of employment contract) until the finality of this decision with a fraction of a
year of at least six (6) months to be considered as one (1) whole year. As determined
by the labor arbiter, the basis for the computation of backwages and separation pay will
be Alilings monthly salary at PhP 17,300.

Same; Same; Solidary Liability; In labor cases, the Court has held corporate
directors and officers solidarily liable with the corporation for the termination of
employment of employees done with malice or in bad faith.A corporation being a
juridical entity, may act only through its directors, officers and employees. Obligations
incurred by them, acting as such corporate agents are not theirs but the direct
accountabilities of the corporation they represent. True solidary liabilities may at times
be incurred but only when exceptional circumstances warrant such as, generally, in the
following cases: 1. When directors and trustees or, in appropriate cases, the officers of
a corporation: (a) vote for or assent to patently unlawful acts of the corporation; (b) act
in bad faith or with gross negligence in directing the corporate affairs; x x x x In labor
cases, for instance, the Court has held corporate directors and officers solidarily liable
with the corporation for the termination of employment of employees done with malice
or in bad faith.

PAGE 36

INTERNATIONAL CATHOLIC MIGRTATION COMMISSION VS NLRC


169 SCRA 606

HELD:

Labor; Illegal dismissal, not a case of; Probationary employment; Failure to qualify as a
regular employee in accordance with reasonable standards of the employer is a just cause for
terminating a probationary employee; Monetary award,not justified due to the express
finding that their was no illegal dismissal.There is justifiable basis for the reversal of
public respondents award of salary for the unexpired three-month portion of private
respondents six-month probationary employment in the light of its express finding that
there was no illegal dismissal. There is no dispute that private respondent was terminated
during her probationary period of employment for failure to qualify as a regular member of
petitioners teaching staff in accordance with its reasonable standards. Records show that
private respondent was found by petitioner to be deficient in classroom management,
teacher-student relationship and teaching techniques. Failure to qualify as a regular
employee in accordance with the reasonable standards of the employer is a just cause for
terminating a probationary employee specifically recognized under Article 282 (now Article
281 of the Labor Code.)
Same; Same; Same; Meanings of probationary employee and probationary".The
legal basis of public respondent is erroneous. A probationary employee, as understood
under Article 282 (now Article 281) of the Labor Code, is one who is on trial by an employer
during which the employer determines whether or not he is qualified for permanent
employment. A probationary appointment is made to afford the employer and opportunity
to observe the fitness of a probationer while at work, and to ascertain whether he will
become a proper and efficient employee. The word probationary, as used to describe the
period of employment, implies the purpose of the term or period, but not its length.
Same; Same; Same; Essence of a probationary period of employment.Being in the
nature of a trial period the essence of a probationary period of employment fundamentally
lies in the purpose or objective sought to be attained by both the employer and the employee
during said period. The length of time is immaterial in determining the correlative rights of
both in dealing with each other during said period. While the employer, as stated earlier,
observes the fitness, propriety and efficiency of a probationer to ascertain whether he is
qualified for permanent employment, the probationer, on the other, seeks to prove to the
employer that he has the qualifications to meet the reasonable standards for permanent
employment.
Same; Same; Same; The employer has the right to choose who will be hired and who
will be denied employment; Equality of right that exists between the employer and the
employee as to the nature of the probationary employment.It is well settled that the
employer has
608
6 SUPREME
08 COURT REPORTS
ANNOTATED
International Catholic
Migration Commission vs.
NLRC
the right or is at liberty to choose who will be hired and who will be denied
employment. In that sense, it is within the exercise of the right to select his employees that
the employer may set or fix a probationary period within which the latter may test and
observe the conduct of the former before hiring him permanently. The equality of right that
exists between the employer and the employee as to the nature of the probationary
employment was aptly emphasized by this Court in Grand Motor Parts Corporation v.
Minister of Labor, et al., 130 SCRA 436 (1984), citing the 1939 case of Pampanga Bus Co.,
Inc. v. Pambusco Employees Union, Inc., 68 Phil. 541.
Same; Same; Same; Art. 281 of the Labor Code gives ample authority to the employer to
terminate a probationary employee for a just cause.As the law now stands, Article 281 of
the Labor Code gives ample authority to the employer to terminate a probationary
employee for a just cause or 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 under Article 281 of the Labor Code that would preclude the
employer from extending a regular or a permanent appointment to an employee once the
employer finds that the employee is qualified for 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, Article 281 of the Labor Code does
not likewise preclude the employer from terminating the probationary employment on
justifiable causes as in the instant case.
Same; Same; Same; Termination of private respondent for just cause negates the
application of the right of security of tenure of probationary employees.We find
unmeritorious, therefore, public respondents argument that the security of tenure of
probationary employees within the period of their probation, as in the case of herein private
respondent, justified the award of salary for the unexpired portion of her probationary
employment. The termination of private respondent predicated on a just cause negates the
application in this case of the pronouncement in the case of Biboso v. Victorias Milling Co.,
Inc., on the right of security of tenure of probationary employees.
Same; Same; Same; Dismissal of private respondent not arbitrary; No unlawful
discrimination in the dismissal by the employer of private respondent.There was no
showing, as borne out by the records, that there was circumvention of the rights of private
respon-
609
VOL. 169, 6
JANUARY 30, 1989 09
International Catholic
Migration Commission vs.
NLRC
dent when she was informed of her termination. Her dismissal does not appear to us as
arbitrary, fanciful or whimsical. Private respondent was duly notified, orally and in writing,
that her services as cultural orientation teacher were terminated for failure to meet the
prescribed standards of petitioner as reflected in the performance evaluation conducted by
her supervisors during the teacher evaluation program. The dissatisfaction of petitioner
over the performance of private respondent in this regard is a legitimate exercise of its
prerogative to select whom to hire or refuse employment for the success of its program or
undertaking. More importantly, private respondent failed to show that there was unlawful
discrimination in the dismissal
Same; Same; Same; Award to private respondent of salary for the unexpired three-
month portion of her six-month probationary employment who was validly terminated
during her probationary employment is unjust and oppressive to the employer.It was thus
a grave abuse of discretion on the part of pubic respondent to order petitioner to pay private
respondent her salary for the unexpired three-month portion of her six-month probationary
employment when she was validly terminated during her probationary employment. To
sanction such action would not only be unjust, but oppressive on the part of the employer as
emphasized in Pampanga Bus Co., Inc., v. Pambusco Employer Union, Inc.

PAGE 37

REALDA VS. NEW AGE GRAPHICS, INC.


671 SCRA 410 , APRIL 25, 2012

Labor Law; Overtime; Disobedience; An employer has the right to require the
performance of overtime service in any of the situations contemplated under Article 89
of the Labor Code and an employees non-compliance is willful disobedience.This
particular issue is far from being novel as this Court had the opportunity in R.B. Michael
Press v. Galit, 545 SCRA 23 (2008), to categorically state that an employer has the right
to require the performance of overtime service in any of the situations contemplated
under Article 89 of the Labor Code and an employees non-compliance is willful
disobedience.

Same; Termination of Employment; Failure to observe prescribed standards of


work, or to fulfill reasonable work assignments due to inefficiency may constitute just
cause for dismissal.Failure to observe prescribed standards of work, or to fulfill
reasonable work assignments due to inefficiency may constitute just cause for
dismissal. Such inefficiency is understood to mean failure to attain work goals or work
quotas, either by failing to complete the same within the alloted reasonable period, or
by producing unsatisfactory results. As the operator of Graphics, Inc.s printer, he is
mandated to check whether the colors that would be printed are in accordance with the
clients specifications and for him to do so, he must consult the General Manager and
the color guide used by Graphics, Inc. before making a full run. Unfortunately, he failed
to observe this simple procedure and proceeded to print without making sure that the
colors were at par with the clients demands. This resulted to delays in the delivery of
output, client dissatisfaction, and additional costs on Graphics, Inc.s part.

Same; Same; Principle of Totality of Infractions; The totality of infractions or the


number of violations committed during the period of employment shall be considered in
determining the penalty to be imposed upon an erring employee; While it may be true
that petitioner was penalized for his previous infractions, this does not and should not
mean that his employment record would be wiped clean of his infractions.In Merin v.
National Labor Relations Commission, 569 SCRA 576 (2008), this Court expounded on
the principle of totality of infractions as follows: The totality of infractions or the
number of violations committed during the period of employment shall be considered in
determining the penalty to be imposed upon an erring employee. The offenses
committed by petitioner should not be taken singly and separately. Fitness for
continued employment cannot be compartmentalized into tight little cubicles of aspects
of character, conduct and ability separate and independent of each other. While it may
be true that petitioner was penalized for his previous infractions, this does not and
should not mean that his employment record would be wiped clean of his infractions.
After all, the record of an employee is a relevant consideration in determining the
penalty that should be meted out since an employees past misconduct and present
behavior must be taken together in determining the proper imposable penalty[.]
Despite the sanctions imposed upon petitioner, he continued to commit misconduct and
exhibit undesirable behavior on board. Indeed, the employer cannot be compelled to
retain a misbehaving employee, or one who is guilty of acts inimical to its interests.

KAKAMPI VS. KINGSPOINT EXPRESS AND LOGISTIC


671 SCRA 483 , APRIL 25, 2012

HELD:
Labor Law; Termination of Employment; In order to validly dismiss an employee,
the employer is required to observe both substantive and procedural due processthe
termination of employment must be based on a just or authorized cause and the
dismissal must be effected after due notice and hearing.It is fundamental that in
order to validly dismiss an employee, the employer is required to observe both
substantive and procedural due processthe termination of employment must be based
on a just or authorized cause and the dismissal must be effected after due notice and
hearing. As to whether Kingspoint Express complied with the substantive requirements
of due process, this Court agrees with the CA that the concerned employees refusal to
submit themselves to drug test is a just cause for their dismissal.

Same; Same; Willful Disobedience; Willful disobedience requires the concurrence of


two elements: (1) the employees assailed conduct must have been willful, that is,
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.An employer may terminate an employment
on the ground of serious misconduct or willful disobedience by the employee of the
lawful orders of his employer or representative in connection with his work. Willful
disobedience requires the concurrence of two elements: (1) the employees assailed
conduct must have been willful, that is, 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.
Both elements are present in this case.

Same; Same; The existence of a single just cause is enough to order their dismissal
and it is now inconsequential if the other charges against them do not merit their
dismissal from service.The existence of a single just cause is enough to order their
dismissal and it is now inconsequential if the other charges against them do not merit
their dismissal from service. It is therefore unnecessary to discuss whether the other
acts enumerated in the notices of termination issued by Kingspoint Express may be
considered as any of the just causes.

IMASEN PHILIPPINE MANUFACTURING CORPORATION VS. ALCON


739 SCRA 186 , OCTOBER 22, 2014

HELD:
Labor Law; Security of Tenure; The law and jurisprudence guarantee to every
employee security of tenure.The law and jurisprudence guarantee to every employee
security of tenure. This textual and the ensuing jurisprudential commitment to the
cause and welfare of the working class proceed from the social justice principles of the
Constitution that the Court zealously implements out of its concern for those with less in
life. Thus, the Court will not hesitate to strike down as invalid any employer act that
attempts to undermine workers tenurial security. All these the State undertakes under
Article 279 (now Article 293) of the Labor Code which bar an employer from terminating
the services of an employee, except for just or authorized cause and upon observance
of due process.

Same; In protecting the rights of the workers, the law, however, does not
authorize the oppression or self-destruction of the employer.In protecting the rights
of the workers, the law, however, does not authorize the oppression or self-destruction
of the employer. The constitutional commitment to the policy of social justice cannot be
understood to mean that every labor dispute shall automatically be decided in favor of
labor. The constitutional and legal protection equally recognize the employers right and
prerogative to manage its operation according to reasonable standards and norms of
fair play. Accordingly, except as limited by special law, an employer is free to regulate,
according to his own judgment and discretion, all aspects of employment, including
hiring, work assignments, working methods, time, place and manner of work, tools to
be used, processes to be followed, supervision of workers, working regulations, transfer
of employees, worker supervision, layoff of workers and the discipline, dismissal
and recall of workers. As a general proposition, an employer has free reign over
every aspect of its business, including the dismissal of his employees as long as the
exercise of its management prerogative is done reasonably, in good faith, and in a
manner not otherwise intended to defeat or circumvent the rights of workers.

Same; Termination of Employment; Serious Misconduct; To constitute a valid cause


for the dismissal within the text and meaning of Article 282 of the Labor Code, the
employees misconduct must be serious, i.e., of such grave and aggravated character
and not merely trivial or unimportant.The just causes for dismissing an employee are
provided under Article 282 (now Article 296) of the Labor Code. Under Article 282(a),
serious misconduct by the employee justifies the employer in terminating his or her
employment. Misconduct is defined as an 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
in judgment. To constitute a valid cause for the dismissal within the text and meaning
of Article 282 of the Labor Code, the employees misconduct must be serious, i.e., of
such grave and aggravated characterand not merely trivial or unimportant.
Additionally, the misconduct must be related to the performance of the
employees duties showing him to be unfit to continue working for the
employer. Further, and equally important and required, the act or conduct must have
been performed with wrongful intent.

Same; Same; Same; Sexual Intercourse in the Work Premises; Dismissal situations
(on the ground of serious misconduct) involving sexual acts, particularly sexual
intercourse committed by employees inside company premises and during work hours,
are not usual violationsand are not found in abundance under jurisprudence.Dismissal
situations (on the ground of serious misconduct) involving sexual acts, particularly
sexual intercourse committed by employees inside company premises and during work
hours, are not usual violations and are not found in abundance under jurisprudence.
Thus, in resolving the present petition, we are largely guided by the principles we
discussed above, as applied to the totality of the circumstances that surrounded the
petitioners dismissal. In other words, we view the petitioners act from the prism of the
elements that must concur for an act to constitute serious misconduct, analyzed and
understood within the context of the overall circumstances of the case. In taking this
approach, we are guided, too, by the jurisdictional limitations that a Rule 45 review of
the CAs Rule 65 decision in labor cases imposes on our discretion.

Same; Same; Same; Same; Whether aroused by lust or inflamed by sincere


affection, sexual acts should be carried out at such place, time and circumstance that,
by the generally accepted norms of conduct, will not offend public decency nor disturb
the generally held or accepted social morals.Sexual acts and intimacies between two
consenting adults belong, as a principled ideal, to the realm of purely private relations.
Whether aroused by lust or inflamed by sincere affection, sexual acts should be carried
out at such place, time and circumstance that, by the generally accepted norms of
conduct, will not offend public decency nor disturb the generally held or accepted social
morals. Under these parameters, sexual acts between two consenting adults do not
have a place in the work environment. Indisputably, the respondents engaged in sexual
intercourse inside company premises and during work hours. These
circumstances, by themselves, are already punishable misconduct. Added to these
considerations, however, is the implication that the respondents did not only disregard
company rules but flaunted their disregard in a manner that could reflect adversely on
the status of ethics and morality in the company.

PAGE 38

RENO FOOD INC VS NAGKAISANG LAKAS NG MANGGAWA

HELD:

Labor Law; Termination of Employment; A criminal conviction is not necessary to


find just cause for employment termination.In Nicolas v. National Labor Relations
Commission, 258 SCRA 250(1996), we held that a criminal conviction is not necessary
to find just cause for employment termination. Otherwise stated, an employees
acquittal in a criminal case, especially one that is grounded on the existence of
reasonable doubt, will not preclude a determination in a labor case that he is guilty of
acts inimical to the employers interests.

Same; Same; Separation Pay; Separation pay is not allowed when an employee is
dismissed for just cause such as serious misconduct.The law is clear. Separation pay
is only warranted when the cause for termination is not attributable to the employees
fault, such as those provided in Articles 283 and 284 of the Labor Code, as well as in
cases of illegal dismissal in which reinstatement is no longer feasible. It is not allowed
when an employee is dismissed for just cause, such as serious misconduct.

Same; Same; Same; Jurisprudence has classified theft of company property as a


serious misconduct and denied the award of separation pay to the erring employee .
Jurisprudence has classified theft of company property as a serious misconduct and
denied the award of separation pay to the erring employee. We see no reason why the
same should not be similarly applied in the case of Capor. She attempted to steal the
property of her long-time employer. For committing such misconduct, she is definitely
not entitled to an award of separation pay.

Same; Same; Length of service and a previously clean employment record cannot
simply erase the gravity of the betrayal exhibited by a malfeasant employee.Length of
service and a previously clean employment record cannot simply erase the gravity of
the betrayal exhibited by a malfeasant employee. Length of service is not a bargaining
chip that can simply be stacked against the employer. After all, an employer-employee
relationship is symbiotic where both parties benefit from mutual loyalty and dedicated
service. If an employer had treated his employee well, has accorded him fairness and
adequate compensation as determined by law, it is only fair to expect a long-time
employee to return such fairness with at least some respect and honesty. Thus, it may
be said that betrayal by a long-time employee is more insulting and odious for a fair
employer.

JOHN HANCOCK INSURANCE CORP V DAVIS


G.R NO. 169549

HELD:

Labor Law; Termination of Employment; Misconduct; For misconduct to be serious


and therefore a valid ground for dismissal, it must be: 1) of grave and aggravated
character and not merely trivial or unimportant and 2) connected with the work of the
employee.Article 282 of the Labor Code provides: Article 282. Termination by
Employer.An employer may terminate an employment for any of the following causes:
(a) Serious misconduct or willful disobedience by the employee of the lawful orders
of his employer or his representatives in connection with his work; x x x x x x
x x x (e) Other causes analogous to the foregoing. Misconduct involves the
transgression of some established and definite rule of action, forbidden act, a
dereliction of duty, willful in character, and implies wrongful intent and not mere error
in judgment. For misconduct to be serious and therefore a valid ground for dismissal, it
must be: 1. of grave and aggravated character and not merely trivial or unimportant
and 2. connected with the work of the employee.

Same; Same; For an employee to be validly dismissed for a cause analogous to


those enumerated in Article 282, the cause must involve a voluntary and/or willful act
or omission of the employee.In this case, petitioner dismissed respondent based on
the NBIs finding that the latter stole and used Yusecos credit cards. But since the theft
was not committed against petitioner itself but against one of its employees,
respondents misconduct was not work-related and therefore, she could not be
dismissed for serious misconduct. Nonetheless, Article 282(e) of the Labor Code talks of
other analogous causes or those which are susceptible of comparison to another in
general or in specific detail. For an employee to be validly dismissed for a cause
analogous to those enumerated in Article 282, the cause must involve a voluntary
and/or willful act or omission of the employee.

Same; Same; Theft; Theft committed by an employee against a person other than
his employer, if proven by substantial evidence, is a cause analogous to serious
misconduct.A cause analogous to serious misconduct is a voluntary and/or willful act
or omission attesting to an employees moral depravity. Theft committed by an
employee against a person other than his employer, if proven by substantial evidence,
is a cause analogous to serious misconduct

Cathedral School of Technology vs. NLRC


214 SCRA 551 , October 13, 1992

HELD:

Labor Law; Employer-employee relationship; The existence of an employer-


employee relationship is essentially a factual question.The existence of an employer-
employee relationship is essentially a factual question and the respondent commissions
findings thereon are accorded great weight and respect and even finality when the
same are supported by substantial evidence. We find no reason to overrule the same.

Same; Dismissal; The reason for which private respondents services were
terminated is analogous to the other just causes enumerated under the Labor Code.
An evaluative review of the records of this case nonetheless supports a finding of a just
cause for termination. The reason for which private respondents services were
terminated, namely, her unreasonable behavior and unpleasant deportment in dealing
with the people she closely works with in the course of her employment, is analogous to
the other just causes enumerated under the Labor Code.
Same; Same; Due Process; Notice alone without the requisite hearing does not
suffice.On the matter of illegal dismissal, petitioners do not dispute the findings, and
in effect admit, that private respondent was denied her right to due process. As found
by the labor arbiter, no hearing on the impending dismissal was conducted as would
have afforded private respondent an opportunity to explain her side and, if need be, to
defend herself. True, petitioners notified her of the schools decision to terminate her
services. But notice alone without the requisite hearing does not suffice.

Same; Same; Same; The requirements of lawful dismissal of an employee by his


employer are two-fold: The substantive and the procedural.Under the Labor Code, as
amended, the requirements of lawful dismissal of an employee by his employer are
two-fold: the substantive and the procedural. Not only must the dismissal be for a valid
or authorized cause as provided by law (Arts. 279, 281, 282-284), but the rudimentary
requirements of due processand hearingmust also be observed before an employee
may be dismissed (Art. 277 [b]). One cannot go without the other, for otherwise the
termination would, in the eyes of the law, be illegal.

Same; Same; Same; Fact that private respondent was illegally dismissed was
premised solely on the fact of alleged lack of procedural due process without regard to
whether or not there was lawful cause for such dismissal.Clearly, therefore, its ruling
that private respondent was illegally dismissed was premised solely on the fact of
alleged lack of procedural due process, without regard to whether or not there was
lawful cause for such dismissal, which latter aspect constitutes the element of
substantive due process. We accordingly proceed to resolve the issue that is thereby
presented.

Same; Same; Benefits; Where the employees dismissal was for a just cause, it
would be neither fair nor just to allow the employee to recover something he has not
earned or could not have earned.This being so, there can be no award for
backwages, for it must be pointed out that while backwages are granted on the basis of
equity for earnings which a worker or employee has lost due to his illegal dismissal,
where private respondents dismissal is for just cause, as is the case herein, there is no
factual or legal basis to order payment of backwages; otherwise, private respondent
would be unjustly enriching herself at the expense of petitioners. Where the employees
dismissal was for a just cause, it would be neither fair nor just to allow the employee to
recover something he has not earned or could not have earned.

Same; Same; Same; Doctrine that employees dismissed for cause are entitled to
separation pay on the ground of social and compassionate justice abandoned.Neither
can there be an award for separation pay. In Cosmopolitan Funeral Homes, Inc. vs.
Maalat, et al., we reiterated the categorical abandonment of the doctrine that
employees dismissed for cause are entitled to separation pay on the ground of social
and compassionate justice. This ruling finds support in Section 7, Book VI of the
Implementing Rules of the Labor Code.
Same; Same; Same; Not being entitled to reinstatement private respondent cannot
legally be entitled to separation pay.Verily, an award for payment of separation pay
presupposes that the illegally dismissed employee would otherwise have been entitled
to reinstatement. Where, as in this case, there is sufficient basis to dismiss private
respondent (aside from the obvious existence of strained relations between the parties)
which accordingly is a lawful impediment to her reinstatement, an award for separation
pay would be a specious inconsistency. Not being entitled to reinstatement, private
respondent cannot legally be entitled to separation pay.

PAGE 39

WILTSHIRE FILE CO., INC. V NLRC


193 SCRA 665

HELD:

Labor Law; Redundancy exists where the services of an employee are in excess of
what is reasonably demanded by the actual requirements of the enterprise.We do not
believe that redundancy in an employers personnel force necessarily or even ordinarily
refers to duplication of work. That no other person was holding the sameposition that
private respondent held prior to the termination of his services, does not show that his
position had not become redundant. Indeed, in any well-organized business enterprise,
it would be surprising to find duplication of work and two (2) or more people doing the
work of one person. We believe that redundancy, for purposes of our Labor Code,
exists where the services of an employee are in excess of what is reasonably demanded
by the actual requirements of the enterprise. Succinctly put, a position is redundant
where it is superfluous, and superfluity of a position or positions may be the outcome of
a number of factors, such as overhiring of workers, decreased volume of .business, or
dropping of a particular produet line or service activity previously manufactured or
undertaken by the enterprise. The employer has no legal obligation to keep in its
payroll more employees than are necessary for the operation of its business.

Same; Same; Case at bar; The characterization of private respon-dents services as


no longer necessary or sustainable, and therefore properly terminable, was an exercise
of business judgment on the part of petitioner company.It is of no legal moment that
the financial troubles of the company were not of private respondents making. Private
respondent cannot insist on the retention of his position upon the ground that he had
not contributed to the financial problems of Wiltshire. The characterization of private
respondents services as no longer necessary or sustainable, and therefore properly
terminable, was an exercise of business judgment on the part of petitioner company.
The wisdom or soundness of such characterization or decision was not subject to
discretionary review on the part of the Labor Arbiter nor of the NLRC so long, of course,
as violation of law or merely arbitrary and malicious action is not shown. It should also
be noted that the position held by private respondent, Sales Manager, was clearly
managerial in character.

Same; Same; Same; Where the ground for dismissal or termination of services
does not relate to a blameworthy act or omission on the part of the employee, there is
no need for an investigation and hearing to be conducted by the employer who does
not allege any malfeasance or non-feasance on the part of the employee.Where, as in
the instant case, the ground for dismissal or termination of services does not relate to a
blameworthy act or omission on the part of the employee, there appears to us no need
for an investigation and hearing to be conducted by the employer who does not, to
begin with, allege any malfeasance or non-feasance on the part of the employee. In
such case, there are no allegations which the employee should refute and defend
himself from. Thus, to require petitioner Wiltshire to hold a hearing, at which private
respondent would have had the right to be present, on the business and financial
circumstances compelling retrenchment and resulting in redundancy, would be to
impose upon the employer an unnecessary and inutile hearing as a condition for legality
of termination.

Same; Same; Same; Same; The appropriate forum to contest the legality or good
faith of the retrenchment or redundancy is the Department of Labor and Employment,
not an investigation or hearing to be held by the employer itself.This is not to say that
the employee may not contest the reality or good faith character of the retrenchment or
redundancy asserted as grounds for termination of services. The appropriate forum for
such controversion would, however, be the Department of Labor and Employment and
not an investigation or hearing to be held by the employer itself. It is precisely for this
reason that an employer seeking to terminate services of an employee or employees
because of closure of establishment and reduction of personnel, is legally required to
give a written notice not only to the employee but also to the Department of Labor and
Employment at least one month before effectivity date of the termination. In the instant
case, private respondent did controvert before the appropriate labor authorities the
grounds for termination of services set out in petitioners letter to him dated 17 June
1985.

Same; Same; Same; Same; Moral damages; The termination of private


respondents services while due to an authorized or statutory cause, was not carried out
in an arbitrary, capricious and malicious manner, with evident personal ill-will.We
hold, therefore, that the NLRCs finding that private respondent had not been accorded
due process, is bereft of factual and legal bases. The award of moral damages that
rests on such ground must accordingly fall. While private respondent may well have
suffered personal embarrassment by reason of termination of his services, such fact
alone cannot justify the award of moral damages. Moral damages are simply a species
of damages awarded to compensate one for injuries brought about by a wrongful act.
As discussed above, the termination of private respondents services was not a wrongful
act. There is in this case no clear and convincing evidence of record showing that the
termination of private respondents services, while due to an authorized or statutory
cause, had been carried out in an arbitrary, capricious and malicious manner, with
evident personal ill-will. Embarrassment, even humiliation, that is not proximately
caused by a wrongful act does not constitute a basis for an award of moral

Same; Same; Private respondent is entitled to separation pay and other benefits
under Article 283 of the Labor Code and petitioners letter dated June 17, 1985.
Private respondent is, of course, entitled to separation pay and other benefits under
Article 283 of the Labor Code and petitioners letter dated 17 June 1985.

CULILI VS. EASTERN TELECOMMUNICATIONS PHILIPPINES, INC.


642 SCRA 338, FEBRUARY 09, 2011

Labor Law; Termination of Employment; An employee may be terminated for


reasons involving measures taken by the employer due to business necessities. Under
our laws, an employee may be terminated for reasons involving measures taken by the
employer due to business necessities.

Same; Same; Redundancy; A position becomes redundant when it is rendered


superfluous by any number of factors such as over-hiring of workers, decrease in
volume of business, or dropping a particular product line or service activity previously
manufactured or undertaken by the enterprise.There is redundancy when the service
capability of the workforce is greater than what is reasonably required to meet the
demands of the business enterprise. A position becomes redundant when it is rendered
superfluous by any number of factors such as over-hiring of workers, decrease in
volume of business, or dropping a particular product line or service activity previously
manufactured or undertaken by the enterprise.

Same; Same; Same; The determination of whether or not an employees services are
still needed or sustainable properly belongs to the employer.This Court has been
consistent in holding that the determination of whether or not an employees services
are still needed or sustainable properly belongs to the employer. Provided there is no
violation of law or a showing that the employer was prompted by an arbitrary or
malicious act, the soundness or wisdom of this exercise of business judgment is not
subject to the discretionary review of the Labor Arbiter and the NLRC.

Same; Same; Same; An employer cannot simply declare that it has become
overmanned and dismiss its employees without producing adequate proof to sustain its
claim of redundancy; Requisites of a Valid Redundancy Program.An employer cannot
simply declare that it has become overmanned and dismiss its employees without
producing adequate proof to sustain its claim of redundancy. Among the requisites of a
valid redundancy program are: (1) the good faith of the employer in abolishing the
redundant position; and (2) fair and reasonable criteria in ascertaining what positions
are to be declared redundant, such as but not limited to: preferred status, efficiency,
and seniority. This Court also held that the following evidence may be proffered to
substantiate redundancy: the new staffing pattern, feasibility studies/proposal on the
viability of the newly created positions, job description and the approval by the
management of the restructuring.

Same; Same; Unfair Labor Practice; The unfair labor practice refers to acts that
violate the workers right to organize; The prohibited acts are related to the workers
right to self-organization and to the observance of a Collective Bargaining Agreement
(CBA); An employer may only be held liable for unfair labor practice if it can be shown
that his acts affect in whatever manner the right of his employees to self-organize.In
the past, we have ruled that unfair labor practice refers to acts that violate the
workers right to organize. The prohibited acts are related to the workers right to self-
organization and to the observance of a CBA. We have likewise declared that there
should be no dispute that all the prohibited acts constituting unfair labor practice in
essence relate to the workers

DOLE PHILIPPINES VS NLRC

PAGE 40

LUCENA OIL FACTORY VS NLRC


GR NO 7840

CHINEVER DECO PRINT VS. NLRC


G.R NO 122876

HELD:

Labor Law; Transfer of Workplace; Closure or Cessation of Operation of


Establishment; Words and Phrases; The phrase closure or cessation of operation of an
establishment or undertaking not due to serious business losses or reverses under
Article 283 of the Labor Code includes both the complete cessation of all business
operations and the cessation of only part of a companys business.Broadly speaking,
there appears no complete dissolution of petitioners business undertaking but the
relocation of petitioners plant to Batangas, in our view, amounts to cessation of
petitioners business operations in Makati. It must be stressed that the phrase closure
or cessation of operation of an establishment or undertaking not due to serious
business losses or reverses under Article 283 of the Labor Code includes both the
complete cessation of all business operations and the cessation of only part of a
companys business. In Philippine Tobacco Flue-Curing & Redrying Corp. vs. NLRC, a
company transferred its tobacco processing plant in Balintawak, Quezon City to Candon,
Ilocos Sur. The company therein did not actually close its entire business but merely
relocated its tobacco processing and redrying operations to another place. Yet, this
Court considered the transfer as closure not due to serious business losses for which
the workers are entitled to separation pay.

Same; Same; Same; Even though the transfer of a company plant is due to a
reason beyond the control of the employer, it still has to accord its employees some
relief in the form of severance pay.There is no doubt that petitioner has legitimate
reason to relocate its plant because of the expiration of the lease contract on the
premises it occupied. That is its prerogative. But even though the transfer was due to a
reason beyond its control, petitioner has to accord its employees some relief in the form
of severance pay. Thus, in E. Razon, Inc. vs. Secretary of Labor and Employment,
petitioner therein provides arrastre services in all piers in South Harbor, Manila, under a
management contract with the Philippine Ports Authority. Before the expiration of the
term of the contract, the PPA cancelled the said contract resulting in the termination of
employment of workers engaged by petitioner. Obviously, the cancellation was not
sought, much less desired by petitioner. Nevertheless, this Court required petitioner
therein to pay its workers separation pay in view of the cessation of its arrastre
operations.

Same; Same; Resignation; Where employer transfers to another place hardly


accessible to its workers, the resulting untimely separation from the service of the latter
could not be construed as resignation.Petitioners contention that private respondents
resigned from their jobs, does not appear convincing. As public respondent observed,
the subsequent transfer of petitioner to another place hardly accessible to its workers
resulted in the latters untimely separation from the service not to their own liking,
hence, not construable as resignation. Resignation must be voluntary and made with
the intention of relinquishing the office, accompanied with an act of relinquishment.
Indeed, it would have been illogical for private respondents herein to resign and then
file a complaint for illegal dismissal. Resignation is inconsistent with the filing of the said
complaint.

VILLENA VS. NLRC

HELD:

Labor Law; Compulsory Retirement; The compulsory retirement was a scheme


employed by the company to terminate Villenas employment without complying the
due process requirements of the law and without regard for his right to security of
tenure.Why Villena was singled out for compulsory retirement when he was only 57
years old and after having served thirty-two (32) years in the company, has not been
explained. While the purpose was allegedly to carry out a retrenchment program to cut
losses, the legal procedure for the retrenchment of personnel was not followed, to wit:
(1) one-month prior notice to the employee as prescribed by law was not given (Art.
283, Labor Code of the Philippines, as amended; Sec. 5, Rule XIV, B.P. 130); (2) no fair
and reasonable criteria were used in carrying out the retrenchment program, such as
(a) less-preferred status (i.e., temporary employees), (b) efficiency rating, and (c)
seniority (Asiaworld Publishing House vs. Ople, 152 SCRA 219); and (3) no proof of the
alleged financial losses suffered by the company was produced (Co-lumbia
Development Corp. vs. Minister of Labor & Employment, 146 SCRA 421). It appears,
therefore, that the so-called compulsory retirement was a scheme employed by the
company to terminate Villenas employment without complying with the due process
requirements of the law and without regard for his right to security of tenure.

Same; Same; Retrenchment; Business losses as a just cause for retrenchment


must be proved, for they can be feigned.While the law recognizes the right of an
employer to dismiss an employee in justifiable cases, it frowns upon the arbitrary and
whimsical exercise of that prerogative when the employees right to due process is
violated (Tan, Jr. vs. NLRC, G.R. No. 85919, March 23, 1990). Business losses as a just
cause for retrenchment, must be proved, for they can be feigned (Garcia vs. NLRC, 153
SCRA 639; Columbia Development Corporation vs. Minister of Labor and Employment,
146 SCRA 421).

Same; Same; Same; Illegal Dismissal; Petitioner Villena is entitled to his full
backwages, allowances and other benefits for a period of three (3) years after his illegal
dismissal until he reached the compulsory retirement age, plus retirement benefits
equivalent to his gross monthly pay, allowances and other benefits for every year of
service up to age sixty (60), the normal retirement age for him. Wherefore, finding
grave abuse of discretion in the decision dated June 15, 1989 of the Second Division of
the National Labor Relations Commission in Case No. 06-02151-87, the questioned
decision is hereby annulled and set aside and a new one is entered ordering the private
respondent, Batangas, Laguna, Tayabas Bus Co., to pay the petitioner, Sabas Villena,
his full backwages, allowances and other benefits for a period of three (3) years after
his illegal dismissal from the service on April 24, 1987, until he reached the compulsory
retirement age, plus his retirement benefits equivalent to bis gross monthly pay,
allowances and other benefits for every year of service up to age sixty (60) which is the
normal retirement age for him.