St. Martin Funeral Home v.

NLRC,[14] which held:

Therefore, all references in the amended Section 9 of B.P. No. 129 to
supposedappeals from the NLRC to the Supreme Court are interpreted and
hereby declared to mean and refer to petitions for certiorari under Rule 65.
Consequently, all such petitions should henceforth be initially filed in the
Court of Appeals in strict observance of the doctrine on the hierarchy of courts
as the appropriate forum for the relief desired.[15]
356 Phil. 811 (1998).

G.R. No. 194649, August 10, 2016

SOLIMAN SECURITY SERVICES, INC. AND TERESITA L. SOLIMAN, Petitioners, v. IGMEDIO C.

SARMIENTO, JOSE JUN CADA AND ERVIN R. ROBIS, Respondents.

DECISION
Placement on floating status as a management prerogative

The Court is mindful of the fact that most contracts for services stipulate that the client may
request the replacement of security guards assigned to it.17 Indeed, the employer has the right to
transfer or assign its employees from one area of operation to another, "provided there is no
demotion in rank or diminution of salary, benefits, and other privileges, and the transfer is not
motivated by discrimination or bad faith, or effected as a form of punishment or demotion
without sufficient cause."18 During that period of time when they are in between assignments or
when they are made to wait for new assignments after being relieved from a previous post,
guards are considered on temporary "off-detail" or under "floating status". It has long been
recognized by this Court that the industry practice of placing security guards on floating status
does not constitute dismissal, as the assignments primarily depend on the contracts entered into
by the agency with third parties19 and the same is a valid exercise of management prerogative.
However, such practice must be exercised in good faith and courts must be vigilant in assessing
the different situations, especially considering that the security guard does not receive any salary
or any financial assistance provided by law when placed on floating status. 20chanrobleslaw

The labor arbiter ruled that the security guard was indeed illegally dismissed from service. The
National Labor Relations Commission (NLRC), however, found that no illegal dismissal took place
–

It is common practice for clients of security agencies to demand replacement of any security
guard assigned to them but cannot demand their dismissal from the employ of the security
agency. And from the time petitioner was relieved from his NPC posting, he was considered on a
floating status which can last for a maximum period of six months.

The Court of Appeals (CA) likewise affirmed the NLRC decision. On appeal to the Supreme Court
(SC), the security guard insisted the security agency terminated his employment based on a
document which certified that he was “terminated from his employment by this agency on 7 May
2003 as per the client’s request.”

The SC held that the guard was not dismissed from service when the security agency terminated
his employment. His removal as the guard of NPC merely put him on floating status wherein he
would await his new assignment.

[There was] no other evidence showing that he was dismissed from employment. While it is true
that he was not allowed to report for work after the period of his suspension expired, the same
was due to NPC’s request for his replacement as NPC was no longer interested in his services. And
as correctly argued by respondents, petitioner from that point onward is not considered
dismissed but merely on a floating status. Such a ‘floating status’ is lawful and not unusual for
security guards employed in security agencies as their assignments primarily depend on the
contracts entered into by the agency with third parties.

Thus, the Court ruled that a security agency may put a guard on floating status while it is looking
for another area to assign its employee to. It clarified that a floating status of an employee can
ripen into constructive dismissal but only after it goes beyond the six month maximum period
allowed by law. Before the lapse of the six month period, a case for illegal dismissal is considered
premature and without basis.

Moreover, Sec. 12, Rule 130, Rules of Court, provide that in the construction and interpretation of
a document, the intention of the parties must be pursued. Section 13 further instructs that the
circumstances under which a document was made may be shown in order to ascertain the correct
interpretation of a document. In the present case, it was clear that the intention of the security
agency was not to dismiss the guard as its employee but merely to relieve him of his assignment
in NPC (Cañedo v. Kampilan Security and Detective Agency Inc., G.R. No 179326, 31 July 2013, J.
Del Castillo).

he focal provision is Article 279 of the Labor Code of the Philippines which provides that “in cases
of regular employment, the employer must not terminate the services of an employee except for
a just cause or when authorized by this Title. An employee who is unjustly dismissed from work
will be entitled to reinstatement without loss of seniority rights and other privileges and to his full
backwages, inclusive of allowances, and to his other benefits or their monetary equivalent
computed from the time his compensation was withheld from him up to the time of his actual
reinstatement.” There being no dismissal of respondent in the present case, the appellate court
has no legal basis to award respondent separation pay and backwages. x x x Worthy of emphasis
is that the award of separation pay is likewise inconsistent with a finding that there was no illegal
dismissal. Separation pay becomes due if an employee is dismissed without just cause and
without due process and is therefore entitled to backwages and reinstatement. And, in instances
where reinstatement is no longer feasible because of strained relations between the employee
and the employer, separation pay is granted in lieu thereof. An illegally dismissed employee is
entitled to either reinstatement, if viable, or separation pay if reinstatement is no longer viable.

Notably, under the doctrine of strained relations, the payment of separation pay is considered an
acceptable alternative to reinstatement when the latter option is no longer desirable or viable.
However, strained relations must be demonstrated as a fact to be adequately supported by
evidence-substantial evidence to show that the relationship between the employer and the
employee is indeed strained as a necessary consequence of the judicial controversy. Applying the
foregoing discussion in the present case, the CA attempted to justify its ruling for the entitlement
of separation pay and backwages on the ground that the relationship between petitioner and
respondent appears strained, and that the instant controversy was a clear case of
“misunderstanding” between petitioner and respondent.

However, the undisputed factual finding is that there was no dismissal to speak of, and therefore,
we cannot find the legal basis of his entitlement to such separation pay and backwages. As we
have previously pronounced, in a case where the employee’s failure to work was occasioned
neither by his abandonment nor by a termination, the burden of economic loss is not rightfully
shifted to the employer; each party must bear his own loss.

Hence, based on the circumstances of this case, the employer should not be made to suffer the
consequences of the employee’s failure to report for duty. There was no allegation much less
proof that the employer intentionally made vague the notices sent to the employee. There was,
therefore, no fault on the part of the employer even if it were true that respondent misunderstood
the letter which prompted him to believe that he was being demoted. The supposed
“misunderstanding” cannot be an excuse for not reporting for work. Indeed there were
subsequent notices of his assignment/detail orders. There can be no justification for his claim for
separation pay and backwages.
By way of reiteration, we declare that in labor cases, where there is neither termination nor
abandonment involved, there is no occasion to grant separation pay and backwages, nor to allow
collection of any other monetary claims absent evidence to substantiate the same. The employer
and the employee do not have any obligation one to the other. (Perez, J., SC First Division, Radar
Security & Watchman Agency, Inc. vs. Jose D. Castro, G.R. No. 211210, December 02, 2015)

Read more: http://www.sunstar.com.ph/cebu/lifestyle/2016/07/08/almirante-separation-pay-and-

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