Labor Review under Dean Salvador Poquiz

5:00-7:00PM, Mondays, 1st sem (AY 2018-19)

Manila Law College
Lecture Notes of Ana Portia Banal-Carza

Lecture date: July 16, 2018

TERMINATION- JUST CAUSE(ACTS OF EMPLOYEE)

SERIOUS MISCONDUCT

1. Not mere verbal tussle

2. Pernicious effects -> gambling, nakadispalko ng company money
-> drug use (drug test, initial test, confirmatory test)
Subject to Twin-Notice Rule

Case of Indecent Acts- Immorality

SC decision -> no immorality, morality is based not in any offense or religious morality, but on public secular morality.

Immorality – conduct is disgraceful, conduct is not acceptable according to the people of the community. Ex.
Married teacher is having an affair with fellow teacher.

Is there an immorality with a teacher who has a relationship with his/her student? If the teacher has legal capacity
to marry his/her student, no immorality.

Sexual intercourse in plain either by lust or affection in company premises is a serious misconduct – It should be
done in a manner as not to disturb or offend public decency.

Theft- stealing money/properties of company/co-employees – It is analogous to serious misconduct but, you have
to consider if the value is negligible, dismissal is too harsh as penalty.

No penalty is too harsh for an employee who has 15 years of service and?

First offense rule/ Proportionality Rule/Doctrine of Commensurate Penalty

- To the degree of the offense committed
- If the offense is light -> the penalty should be light

Factors of imposing Dismissal

1. Length of Penalty
2. Gravity of the offense
3. First offence rule
4. The nature of employer’s business
5. The nature of suspension
6. Totality of infraction (collective)
7. Principle of Compassion
8. Principle of Equity

1. Length of gravity and first offense rule- do not apply these two factors to grave offense.
Ex. Bank manager took Php 300,000.00 gave to sister. She was about to retire (30 years of service) no
offense committed, except the one grave offense she committed (exculpate her for the first offense rule and
length of service rule?). Length of service was overshadowed by the gravity of offense. First offense rule is
not applicable as to the offense.

2. Nature of position
- Mere finding of the basis on the trust and confidence can validly dismiss an employee.
 - Fiduciary position- an employee is reposed with trust and confidence. Ex. Accountant, auditor- mere
violation of trust and confidence
- Rank-and-file – tedious and rigorous

3. Nature of the business

-An employee in school: Teacher married, student single. You give a big significance to morality.
-Smoking in a no-smoking area-penalty is dismissal-> it is too harsh as penalty
-But repeated smoking constitutes gross habitual/repeated offense
-Situs- Gasoline station – gas boy holding a cigarette-> dismissal is legal (2008 bar)
-A strict observance of safety measure,
-A slight mistake will lead the establishment into burned ground.

4. Totality of the Infraction Rule Collective

-You can totalize past infraction to justify dismissal,
-double penalty-dismissal is not proper but you can apply it in relation to another subsequent infraction.

5. Principle of Charity
-cases are applied by the SC usually to those lower brackets of society, the common tao,
-a case of janitor, to dismiss him will entirely affect his family
6. Principle of Equity – examples on some equitable grounds
-granting him separate pay for the length of service is justice outside law-> equity into relations is justice
outside the law.

Lecture Date: July 23, 2018

FACTORS TO BE CONSIDERED IN TERMINATING ( JUST CAUSE)

Principle of Equity – willful, deliberate disobedience

- Simply insubordination- you can use length of service or gravity of offense-> willfully, deliberately violated
company policies.
Ex. Automotive Company
-Mechanic used the vehicle w/o supervisor’s approval (Mercedes Benz)
- Dismissal on the first offense is harsh as a penalty
- Repeated commission of the same offense will amount to serious misconduct -> dismissal
-Not only mere insubordination if the vehicle (M-Benz) was wrecked/damaged, habitual and gross neglect
of duty
Similar situations of these positions:
1) Cashier
2) Teller
- Reposed with trust and confidence –mere breach will justify dismissal
->Gross and habitual neglect of duty – total loss of care
->You can dispense with habitually provided it is gross in action
-> Gross and inefficiency – are analogous acts
-Criminal act against employer, immediate family members including managers or managerial employee
-> it will justify dismissal -extension of employers

Volume II –Please check law on dismissal

Abandonment – neglect of duty

-Element-has no more intention to return
-no need to have due notice
-1st notice in writing in his last known address
-2nd ample opportunity to be heard
-post notice/ last notice
-the very fact of filing illegal dismissal negates abandonment
-if he has the intention to return, there is no abandonment
 -If he has intention to sever employee-employment relation

Serious insult- act of the employer wounds the feeling of an employee

-Employee resigns – voluntarily/free dismissal-> constructive dismissal
-from Chief Engineer ------------------------------- to Chief Janitor} It wounds the feelings of employee
-with special amenities - removed all the special amenities

-continued employment has become unbearable, unlikely, and impossible under circumstances,
-insensible acts of employer that made the employee resigned, the employee dismissed himself
-all acts are disdainful, unbearable because it affects the body and mind of the employee and that constraint
the latter to resign
-30 days of suspension metamorphoses to constructive dismissal

Blue Dairy Doctrine –unreasonable, prejudicial, inconvenient if the transfer is ill-motivated, bad faith,
waiting posted beyond 6 months
-Redundancy
-Retrenchment
-Automation
-Contracting out of services
-permanent in nature
-more than 6 months
-Premature repatriation
-Sea man – Book I, Book IV

Involuntary resignation
-If resignation is voluntarily done, to be legal it should be in writing.
- Can the employee resign verbally? There is no prohibition as long as employer accepted.
-Resignation should be employee’s volition not against his will
-Resignation is a win-win solution, SC ruled it is valid. Less effort on the part of the employer.

Lecture Date: July 30, 2018

Continuation

Constructive Dismissal-demotion in rank, dismissal in disguise, diminution of pay

-illegal suspension of 30 days beyond that period
-period of 6 months without assignment (Security guard)
-Premature Termination (OFW, Seaman)
-> Sabeer v. Cabiles – } RA 8042 Migrant Act, par,5, Unconstitional violative of equal protection clause
-Congress can not re-enact a part of the law that has been declared unconstitutional
-> Serrano vs. Gallant Maritime-} in case of illegal dismissal, they are entitled to their salaries for the entire
unexpired portion of their contract.
-Serious insult –unbearable treatment (against fear of his/her life, physical or not, insensible disdain) will compel
the employee to resign

TERMINATION -AUTHORIZED CAUSES -(NITIATED BY EMPLOYER)

Automation – introduction of automated or labor-saving device

-Replacement of workers by machine- it must be done in good faith
Ex. SMC replaced its workers by speed machine as part of the project of SMC as introduction of labor saving device
-requirement: 2 separate notice rule
->30 days to DOLE -> notice in effecting termination, place notice in a conspicuous place in the company (NOT
VALID)
->30 days to Employee-> Individual letter to each employee must be complied to be VALID
-Fair and reasonable criteria –LIFO rule- Last In, First Out-Seniority rules, Separation 1 month equivalent of service
Retrenchment –to prevent loss, to reduce company personnel, prevent the ultimate downfall of the company
-If the company/owner foresees the loss , he must do something to prevent the loss
- Actual loss- requirement: 2 separate notice rule, fair and reasonable, LIFO, it must be done in good faith and proof
of loss, half month equivalent salary
-
Redundancy- it is the duplication of work, no said the SC
-if it is superfluous, over-hiring of workers, excess services, over ride. If there are 4 employees in 1 function, the Er
can dismiss the 3. If there are no raw materials which results to less production, there is a decline the volume of
production.
-same requirement: last 1 month salary X number of years in service.

Disease- the Burden of Proof is to the Er, a ground to terminate

-Medical certificate issued by a public authority- government doctors
-requirements: prohibited by law or prejudicial to its fellow
-any disease contemplated therein, contagious or non-contagious except HIV and Hepatitis
-if disease can be cured within 6 months, he can be retained
-Requirements: It is incumbent upon the Er to prove the disease, ½ month , because he/she is entitled to the
benefits mandated by SSS.

Closure –cessation of business

-Partial closure (closure of production line) = equivalent to retrenchment liable to separation pay of ½ month pay
for every year ex. Case of ABS-CBN
-Full closure –grounded on the serious economic business losses

Procedural Aspect – 3-Notice rule

1st- Formal specific charges-( King of Kings)

-Narration of charges – to inform the employees of the specific charges
-Ee submits an intelligible response/reply
2nd- A hearing and conference
-Ample opportunity to defend himself or to be heard
-Presents his evidence or rebut the evidence presented against him.
3rd A written notice of termination served on the employee,
- indicating that upon due consideration of all the circumstances, grounds have been established to justify his
termination

Perez Doctrine (Perez v. PT&T

1) no hearing and conference
2) Employee requests the first
3) Voluntary Employer requests the first
- To inform the employee of his dismissal
- To contest the validity of the dismissal

If illegally dismissed, Ee is entitled to:

1) Reinstatement
2) Separation Pay
3) Attorney fees
4) 6% legal fees

Reinstatement-restoration of a dismissed employee from his previous brought about by his dismissal.
-inadvertently self-executory, no filing of writ of execution
-applicable only to Labor Arbiter Level
-if elevated, not self-executory in NLRC Commission, Court of Appeals and Supreme Court
-> it requires writ of execution
There are 2 options in reinstatement:
 1)Actual
2)Payroll- retained in payroll-receives salary even there is a violation to No Work, No Pay
-> Yes , but it is a law. Dura rex Sed lex

If Employer does not follow:

1) Contempt of Court
2) Motion can be filed for payment of monthly salaries for refusal to comply
3) 2011 NLRC Rules of procedure, the LA shall motu propio issue a corresponding writ to satisfy the
reinstatement order
4) If reinstatement is not possible as for of absolute compromise to reinstate.

Can you compel employee to reinstate? No it is his personal right for fear of reprisal, hardship upon the employee
or constructive dismissal.
-Waiver and laches- undue delay, failed to assert your reinstatement, stale claim- 4 years of presumption
-Doctrine of Strained Relationship-need not to be declared by Er
-If there is a law to reinstate, the Er cannot refuse
-If reconciliation is not possible and payment as a form of compromise
-Filled up position
-Closure of business
-Reinstatement is legal & physical impossibility, there is separation pay as a for of compromise
-Old-age, physical incapacity, disability acceptance of separation pay
-Not conducive to working relation
-Reinstatement is not proper under principle of fiduciary relationship, ex Kasambahay- she might take even or
steal

Kasambahay law-> no reinstatement –Regional Director’s Office

Seaman -> no reinstatement

Full Back Wages Doctrine (6715) –The income derived by the Ee from other places without qualifications of
deductions, cut-off date March 29, 1989. Prevailing Doctrine, Teehanke Formula, Mercury.

In 1993, the Mercury Drug rule was modified in Ferrer v. NLRC, where the Supreme Court again directed payment
of backwages for the entire period that a dismissed employee was without work subject, however, to a deduction
of the total earnings derived by the employee elsewhere from the date of his dismissal up to the date of his
reinstatement. This modification was a consequence of the amendment of the Labor Code by R.A. 6715, which
expressly directed an award of full back wages to an illegally dismissed employee.

Is there a non-full back wages/limited back wages?

In RA 6715, backwages to be awarded to an illegally dismissed employee, should not, as a general rule, be
diminished or reduced by earnings derived by him elsewhere during his illegal dismissal(Bustamante v NLRC)

Dismissal is a harsh penalty.

Damages- an accord is necessary in illegal dismissal if there is an injury to the right of worker.

What kind of damages?

Damages from Labor and Civil, moral and exemplary.

When is moral damages proper?

When the illegal dismissal is against the law, public policy and moral.

When is exemplary damages proper?

When te following are present: malicious, repressive, whimsical, despotic, capricious, cruel.
May a LA award 50, 000 damage? Yes. A 100,000. Exemplary damage? Yes! Pwedeng pantay, pwedeng mataas ang
moral o mababa ang exemplary/ pwedeng mababa ang moral, mataas ang exemplary

In the dispositive portion, it should be written: Atty.’s fee, why an award is proper, dismissal compelled the Ee to
hire ti litigate his case, but this is for legally dismissed Ee.

Atty.’s fee is one form of damage

Ordinary concept – it should be agreed by Atty. & client.
Can the lawyer receive it lower than to 10%? Yes.
Legally dismissed is entitled to 6% legal interest.