Labor

Reso: Tongko vs Manulife (GR No. 167622 January 25, 2011)

Tongko vs Manufacturer’s Life Insurance Co.
GR No. 167622 January 25, 2011

Issue: Whether or not petitioner as insurance agent is an employee of respondent company.

Held: No. Based on the evidence on record, the petitioner’s occupation was to sell Manulife’s insurance policies and products from 1977 until the termination of the career agent’s agreement. The evidence also shows that through the years, Manulife permitted him to exercise guiding authority over other agents who operate under their own agency agreements with Manulife and whose commissions he shared. Under this scheme — an agreement that pervades the insurance industry — petitioner in effect became a “lead agent” and his own commissions increased as they included his share in the commissions of the other agents; he also receive greater reimbursement for expenses and was allowed to use Manulife’s facilities. His designation also changed from unit manager to branch manager and then to regional sales manager, to reflect the increase in the number of agents he recruited and guided, as well as the increase in the area where these agents operated.

In our June 29, 2010 resolution, we noted that there are built in elements of control specific to an insurance agency, which do not amount to the elements of control that characterizes an employment relationship governed by the labor code. The insurance code provides definite parameters in the way an agent negotiates for the sale of the company’s insurance products, his collection activities and his delivery of the insurance contract or policy. In addition, the civil code defines an agent as a person who binds himself to do something in behalf of another, with the consent or authority of the latter. Article 1887 of the civil code also provides that in the execution of the agency, the agent shall act in accordance with the instructions of the principal.

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Dumpit-Murillo vs CA (GR No. 164652 June 8, 2007)

Dumpit-Murillo vs Court of Appeals
GR No. 164652 June 8, 2007

Facts: On October 2, 1995, under talent contract no. NT95-1805, private respondent Associated Broadcasting Company (ABC) hired petitioner Thelma Dumpit-Murillo as a newscaster and co-anchor of Balitang-Balita, an early evening news program. The contract was for a period of 3 months. It renewed under talent contract nos. NT95-1915, NT96-3002, NT98-4984, and NT99-5649. In addition, petitioner’s services were engaged for the program “Live on Five.” On September 30, 1999, after 4 years of repeated renewals, petitioner’s talent contract expired. Two weeks after the expiration of the last contract, petitioner sent a letter to Mr. Jose Javier, Vice President for news and public affairs of ABC, informing the latter that she was still interested in renewing her contract subject to a salary increase, thereafter, petitioner stopped reporting for work. On November 5, 1999 she wrote Mr. Javier another letter.

Issue: Whether or not the continuous renewal of petitioner’s talent contracts constitute regularity in the employment status.

Held: Yes. An employer-employee relationship was created when the private respondents started to merely renew the contracts repeatedly 15 times for 4 consecutive years.

Petitioner was a regular employee under contemplation of law. The practice of having fixed-term contracts in the industry does not automatically make all talent contracts valid and compliant with labor law. The assertion that a talent contract exists does not necessarily prevent a regular employment status.

The elements to determine the existence of an employment relationship are: a.) The selection and engagement of the employee; b.) The payment of wages; c.) The power of dismissal; and d.) The employer’s control of the employee’s conduct, not only as to the result of the work to be done, but also as to the means and methods to accomplish it.

The duties of petitioner as enumerated in her employment contract indicate that ABC had control over the work or petitioner. Aside from control, ABC also dictated the work assignments and payment of petitioner’s wages. ABC also had power to dismiss her. All these being present, clearly there existed an employment relationship between petitioner and ABC. 

Concerning regular employment, the law provides for 2 kinds of employees, namely: 1.) Those who are engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer; and 2.) Those who have rendered at least one year of service, whether continuous or broken with respect to the activity in which they are employed. In other words, regular status arises from either the nature of work of the employee or the duration of his employment.

The primary standard of determining regular employment is the reasonable connection between the particular activity performed by the employee vis-a-vis the usual trade or business of the employer. This connection can be determined by considering the nature of the work performed and its relation to the scheme of the particular business or trade in its entirety. If the employee has been performing the job for at least a year, even if the performance is not continuous and merely intermittent, the law deems repeated and continuing need for its performance as sufficient evidence of the necessity if not indispensability of that activity to the business. 

AFP Mutual vs NLRC (GR No. 102199 January 28, 1997)

AFP Mutual Benefit Association Inc vs National Labor Relations Commission
GR No. 102199 January 28, 1997

Facts: Private respondent Eutiquio Bustamente had been an insurance underwriter of petitioner AFP Mutual Benefit Association Inc. since 1975. The sales agreement provided for Bustamente’s duties and obligations, commissions and a statement that there shall be no employer-employee relationship between the parties, the sales agent being hereby deemed an independent contractor. On July 5, 1989, petitioner dismissed private respondent for misrepresentation and for simultaneously selling insurance for another life insurance company in violation of said agreement. On November 23, 1989, private respondent filed a complaint with the office of the insurance commissioner praying for the payment of the correct amount of his commission. Atty. German C. Alejandria, chief of the public assistance and information division, office of the insurance commissioner, advised private respondent that it was the DOLE that had jurisdiction over his complaint. On February 26, 1990, private respondent filed his complaint with the Department of Labor claiming : 1.) Commission for 2 years from termination of employment equivalent to 30% of premiums remitted during employment; 2.) P354,796 as commissioned earned from renewals and old business generated since 1983; 3.) P100,000 as moral damages; and 4.) P100,000 as exemplary damages.

Issue: Whether or not there existed an employer-employee relationship between petitioner and private respondent.

Held: No. Well settled is the doctrine that the existence of an employer-employee relationship is ultimately a question of fact and that the findings thereon by the labor arbiter and the NLRC shall be accorded not only respect but even finality when supported by substantial evidence. The determinative factor in such finality is the presence of substantial evidence to support said finding. Otherwise, such factual findings cannot bind this court.

Time and again, the court has applied the four-fold test in determining the existence of employer-employee relationship. This test considers the following elements: 1.) The power to hire; 2.) The payment of wages; 3.) The power to dismiss; 4.) The power to control, the last being the most important element.

The difficulty lies in correctly assessing if certain factors or elements properly indicate the presence of control. Anent the issue of exclusivity in the case at bar, the fact that private respondent was required to solicit business exclusively for petitioner could hardly be considered as control on labor jurisprudence. Under memo circulars no. 2-81 and 2-85, dated December 17, 1981 and August 7, 1985 respectively issued by the insurance commissioner, insurance agents are barred from serving more than one insurance companies to exercise exclusive supervision over their agents in their solicitation work. Thus, the exclusivity restriction clearly springs from a regulation issued by the insurance commission, and not from an intention by petitioner to establish control over the method and manner by which private respondent shall accomplish his work. This feature is not meant to change the nature of the relationship between the parties, nor does it necessarily imbued such relationship with the quality of control envisioned by law.

To restate, the significant factor in determining the relationship of the parties is the presence or absence of supervisory authority yo control the method and the details of performance of the service being rendered, and the degree to which the principal may intervene to exercise such control. The presence of such power of control is indicative of an employment relationship, while absence thereof is indicative of independent contractorship. In other words, the test to determine claiming to be independent contractor has contracted to do the work according to his own methods and without being the subject to the control of the employer except only as to the result of his work. Such is exactly the nature of the relationship between petitioner and private respondent.

Such lack of jurisdiction of a court or tribunal may be raised at any stage of the proceedings, even on appeal. The doctrine of estoppel cannot be properly invoked by respondent commission to cure this fatal defect as it cannot confer jurisdiction upon a tribunal that to begin with, was bereft of jurisdiction over a cause of action. Moreover, in the proceedings below, the petitioner consistently challenged the jurisdiction of the labor arbiter and respondent commission.

Insular Life vs NLRC (GR No. 119930 March 12, 1998)

Insular Life Assurance Co. Ltd. vs National Labor Relations Commission (Delos Reyes)
GR No. 119930 March 12, 1998

Facts: On August 21, 1992 petitioner entered into an agency contract with respondent Pantaleon Delos Reyes authorizing the latter to solicit within the Philippines applications for life insurance and annuities for which he would be paid compensation in the form of commitment. The contract was prepared by petitioner in its entirety and Delos Reyes merely signed his confirmity thereto. It contained the stipulation that no employer-employee relationship shall be created between the parties and that the agent shall be free to exercise his own judgement as to time, place and means of soliciting insurance. Delos Reyes however was prohibited by petitioner from working for any other life insurance company, and violation of this stipulation was sufficient ground for termination of the contract. Aside from soliciting insurance for the petitioner, private respondent was required to submit to the former all completed applications for insurance within 90 consecutive days, deliver policies, receive and collect initial premiums and balances of first year premiums, renewal premiums, deposits on applications and payments on policy loans. Private respondent was also bound to turn over to the company immediately any and all sums of money collected by him. In a written communication by petitioner to respondent Delos Reyes, the latter was urged to register with the Social Security System (SSS) as a self-employed individual as provided under PD 1636. On March 1, 1993, petitioner and private respondent entered into another contract where the latter was appointed as acting, unit manager under its office — the Cebu DSO vs Private respondent concurrently as agent and acting unit manager until he was notified by petitioner on November 18, 1993 that his services were terminated effective December 18, 1993. On November 7, 1994 he filed a complaint before the labor arbiter on the ground that he was illegally dismissed and that he was not paid his salaries and separation pay.

Issue: Whether or not there is an employer-employee relationship between the parties to entitle jurisdiction of the case before the labor arbiter.

Held: Yes. It is axiomatic that existence of an employer-employee relationship cannot be negated by expressly repudiating it in the management contract and providing therein that the employee is an independent contractor when the terms of the agreement clearly shows otherwise. For, the employment status of a person is defined and prescribed by law and not by what the parties say it should be. In determining the status of the management contract, the “four-fold test” on employment earlier mentioned has to be applied.

Unlike Basiao, herein respondent Delos Reyes was appointed acting unit manager, not agency manager. There is no evidence that to implement his obligations under the management contract, Delos Reyes had organized an office. Petitioner in fact has admitted that it provided Delos Reyes a place and a table at its office where he reported for and worked whenever he was not out in the field. Placed under petitioner’s Cebu District Service Office, the unit was given a name by petitioner – Delos Reyes and Associates — and assigned code no. 11753 and recruitment no. 109398. Under the managership contract, Delos Reyes was obliged to work exclusively for petitioner in life insurance solicitation and was imposed premium production quotas. Of course, the acting unit manager could not underwrite other lines of insurance because his permanent certificate of authority was for life insurance only and for no other. He was proscribed from accepting a managerial or supervisory position. In any other office including the government without the written consent of petitioner. Delos Reyes could only be promoted to permanent unit manager if he met certain requirements and his promotion was recommended by the petitioner’s district manager and regional manager and approved by its division manager. As acting unit manager, Delos Reyes performed functions beyond mere solicitation of insurance business for petitioner. As found by the NLRC, he exercised administrative functions which were necessary and beneficial to the business of insular life.

Exclusivity of service, control of assignment and removal of agents under private respondent’s unit, collection of premiums, furnishing company facilities and materials as well as capital described as unit development fund are but hallmarks of the management system in which herein private respondent worked. This obtaining, there is no escaping the conclusion that private respondent Pantaleon Delos Reyes was an employee of herein petitioner.

Insular Life vs NLRC (GR No. 84484 November 15, 1989)

Insular Life Assurance Co. Ltd vs National Labor Relations Commission
GR No. 84484 November 15, 1989

Facts: On July 2, 1968, Insular Life Assurance Co. Ltd and Melecio T. Basiao entered into a contract by which:

  1. Basiao was “authorized to solicit within the Philippines applications for insurance policies and annuities in accordance with the existing rules and regulations” of the company;
  2. He would receive “compensation, in the form of commissions.. as provided in the schedule of commissions” of the contract to “constitute a part of the consideration of (said) agreement,” and;
  3. The “rules in (the company) rate book and its agent’s manual as well as all circulars and those which may from time to time be promulgated by it,” were made part of said contract.

Some four years later, in April 1972, the parties entered into another contract – An agency manager’s contract – and to implement his end of it Basiao organized an agency or office to which he gave the name M Basiao and Associates, while concurrently fulfilling this commitments under the first contract with the company.

In May 1979, the company terminated the Agency Manager’s contract. After seeking a reconsideration, Basiao sued the company in a civil action and this was later to claim, prompted the latter to terminate also his engagement under the first contract and to stop payment of his commission starting April 1, 1980.

Issue: Whether or not the Labor Arbiter have jurisdiction by virtue of the contract between the company and Basiao.

Held: No. In determining the existence of employer-employee relationship, the following elements are generally considered namely: 

  1. The selection and engagement of the employee;
  2. The payment of wages;
  3. The power of dismissal; and
  4. The power to control the employee’s conduct

— although the latter is the most important element.

Logically, the line should be drawn between rules that merely serve as guidelines towards the achievement of the mutually desired result without dictating the means or methods to be employed in attaining it, and those that control or fix the methodology and bind or restrict the party hired to the use of such means. The first, which aim only to promote the result, create no employer-employee relationship unlike the second, which address both the result and the means used to achieve it. The distinction acquires particular relevance in the case of an enterprise affected with public interest, as is the business of insurance and is on that account subject to regulation by the state with respect, not only to the internal affairs of the insurance company. Rules and Regulations governing the conduct of the business are provided for in the insurance code and enforced by the insurance commissioner. It is, therefore, usual and expected for an insurance company to promulgate a set of rules to guide its commission agents in selling its policies that they may not run afoul of the law and what it requires or prohibits. Of such a character are the rules which prescribes the qualifications of persons who may be insured, subject insurance applications to processing and approval by the company and also reserve to the company the determination of the premiums to be paid and the schedules of payment. None of these really invades the agents contractual prerogative to adopt his own selling methods or to sell insurance at his own time and convenience, hence cannot justifiably be said to establish on employer-employee relationship between him and the company.

The labor arbiter’s decision makes reference to Basiao’s claim of having been connected with the company for 25 years whatever this is meant to imply, the obvious reply would be that what is germane here is Basiao’s status under the contract of July 2, 1968, not the length of his relationship with the company.

The court, therefore, rules that under the contract invoked by him, Basiao was not an employee of the petitioner, but a commission agent, an independent contractor whose claim for unpaid commissions should have been litigated in an ordinary civil action. The labor arbiter erred in taking cognizance of and adjudicating, said claim, being without jurisdiction to do so, as did the respondent NLRC in affirming the arbiter’s decision. This conclusion renders it unnecessary and premature to consider Basiao’s claim for commission on its merits.

Manila Jockey vs Trajano (G.R. No. 160982 June 26, 2013)

Manila Jockey Club Inc vs Trajano
G.R. No. 160982 June 26, 2013

Facts: MJCI had employed Trajano as a selling teller of betting tickets since November 1989. On April 25, 1998, she reported for work. At around 7:15 p.m., two regular bettors gave her their respective lists of bets (rota) and money for the bets for Race 14. Although the bettors suddenly left her, she entered their bets in the selling machine and segregated the tickets for pick up by the two bettors upon their return. Before closing time, one of the bettors (requesting bettor) returned and asked her to cancel one of his bets worth P2,000.00. Since she was also operating the negative machine on that day, she obliged and immediately cancelled the bet as requested. She gave the remaining tickets and the P2,000.00 to the requesting bettor, the money pertaining to the canceled bet. When Race 14 was completed, she counted the bets received and the sold tickets. She found that the bets and the tickets balanced. But then she saw in her drawer the receipt for the canceled ticket, but the canceled ticket was not inside the drawer. Thinking she could have given the canceled ticket to the requesting bettor, she immediately looked for him but could not find him. It was only then that she remembered that there were two bettors who had earlier left their bets with her. Thus, she went to look for the other bettor (second bettor) to ask if the canceled ticket was with him. When she located the second bettor, she showed him the receipt of the canceled ticket to counter-check the serial number with his tickets. Thereafter, the second bettor returned to Trajano and told her that it was one of his bets that had been canceled, instead of that of the requesting bettor. To complicate things, it was also the same bet that had won Race 14. Considering that the bet was for a daily double, the second bettor only needed to win Race 15 in order to claim dividends. At that point, she realized her mistake, and explained to the second bettor that the cancellation of his ticket had not been intentional, but the result of an honest mistake on her part. She offered to personally pay the dividends should the second bettor win Race 15, which the latter accepted. When Race 15 was completed, the second bettor lost. She was thus relieved of the obligation to pay any winnings to the second bettor. To her surprise, the reliever-supervisor later approached Trajano and told her to submit a written explanation about the ticket cancellation incident. The next day (April 26, 1998), she submitted the handwritten explanation to Atty. Joey R. Galit, Assistant Racing Supervisor. She then resumed her work as a selling teller, until later that day, when she received an inter-office correspondence signed by Atty. Galit informing her that she was being placed under preventive suspension effective April 28, 1998, for an unstated period of time. At the end of thirty days of her suspension, Trajano reported for work. But she was no longer admitted. She then learned that she had been dismissed when she read a copy of an interoffice correspondence about her termination posted in a selling station of MJCI.

Issue: Whether or not Trajano is validly dismissed.

Held: No. The valid termination of an employee may either be for just causes under Article 282 or for authorized causes under Article 283 and Article 284, all of the Labor Code.

Specifically, loss of the employer’s trust and confidence is a just cause under Article 282 (c), a provision that ideally applies only to cases involving an employee occupying a position of trust and confidence, or to a situation where the employee has been routinely charged with the care and custody of the employer’s money or property. But the loss of trust and confidence, to be a valid ground for dismissal, must be based on a willful breach of trust and confidence founded on clearly established facts. “A breach is willful,” according to AMA Computer College, Inc. v. Garay, “if it is done intentionally, knowingly and purposely, without justifiable excuse, as distinguished from an act done carelessly, thoughtlessly, heedlessly or inadvertently. It must rest on substantial grounds and not on the employer’s arbitrariness, whims, caprices or suspicion; otherwise, the employee would eternally remain at the mercy of the employer.” An ordinary breach is not enough.

Moreover, the loss of trust and confidence must be related to the employee’s performance of duties.  As held in Gonzales v. National Labor Relations Commission:

Loss of confidence, as a just cause for termination of employment, is premised on the fact that the employee concerned holds a position of responsibility, trust and confidence. He must be invested with confidence on delicate matters such as the custody, handling, care and protection of the employer’s property and/or funds. But in order to constitute a just cause for dismissal, the act complained of must be “work-related” such as would show the employee concerned to be unfit to continue working for the employer.

As a selling teller, Trajano held a position of trust and confidence. The nature of her employment required her to handle and keep in custody the tickets issued and the bets made in her assigned selling station. The bets were funds belonging to her employer. Although the act complained of – the unauthorized cancellation of the ticket (i.e., unauthorized because it was done without the consent of the bettor) – was related to her work as a selling teller, MJCI did not establish that the cancellation of the ticket was intentional, knowing and purposeful on her part in order for her to have breached the trust and confidence reposed in her by MJCI, instead of being only out of an honest mistake.

The procedure to be followed in the termination of employment based on just causes is laid down in Section 2 (d), Rule I of the Implementing Rules of Book VI of the Labor Code, to wit:

Section 2. Security of Tenure. —
x x x x

(d) In all cases of termination of employment, the following standards of due process shall be substantially observed:

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

(i) A written notice served on the employee specifying the ground or grounds for termination, and giving said employee reasonable opportunity within which to explain his side.
(ii) A hearing or conference during which the employee concerned, with the assistance of counsel if he so desires is given opportunity to respond to the charge, present his evidence, or rebut the evidence presented against him.
(iii) A written notice of termination served on the employee, indicating that upon due consideration of all the circumstances, grounds have been established to justify his termination.

In case of termination, the foregoing notices shall be served on the employee’s last known address.

A review of the records warrants a finding that MJCI did not comply with the prescribed procedure.

There is no question that an illegally dismissed employee is entitled to her reinstatement without loss of seniority rights and other privileges, and to full back wages, inclusive of allowances and other benefits or their monetary equivalent.

In case the reinstatement is no longer possible, however, an award of separation pay, in lieu of reinstatement, will be justified. The Court has ruled that reinstatement is no longer possible: (a) when the former position of the illegally dismissed employee no longer exists; or (b) when the employer’s business has closed down; or (c) when the employer-employee relationship has already been strained as to render the reinstatement impossible. The Court likewise considered reinstatement to be non-feasible because a “considerable time” has lapsed between the dismissal and the resolution of the case. In that regard, a lag of eight years or ten years is sufficient to justify an award of separation pay in lieu of reinstatement.

Philippine Journalist vs Journal Employees Union (G.R. No. 192601 June 3, 2013)

Philippine Journalist, Inc vs Journal Employees Union
G.R. No. 192601 June 3, 2013

Facts: The second complainant Michael L. Alfante alleged that he started to work with respondents as computer technician at Management Information System under manager Neri Torrecampo on 16 May 2000; that on 15 July 2001, he was regularized receiving a monthly salary of P9,070.00 plus other monetary benefits; that sometime in 2001, Rico Pagkalinawan replaced Torrecampo, which was opposed by complainant and three other co-employees; that Pagkalinawan took offense of their objection; that on 22 October 2002, complainant Alfante received a memorandum from Pagkalinawan regarding his excessive tardiness; that on 10 June 2003, complainant Alfante received a memorandum from Executive Vice-President Arnold Banares, requiring him to explain his side on the evaluation of his performance submitted by manager Pagkalinawan; that one week after complainant submitted his explanation, he was handed his notice of dismissal on the ground of “poor performance”; and that complainant was dismissed effective 28 July 2003. Complainant Alfante submitted that he was dismissed without just cause. With respect to the alleged non-adjustment of longevity pay and burial aid, respondent PJI pointed out that it complies with the provisions of the CBA and that both complainants have not claimed for the burial aid.

Issue: Whether or not petitioner’s denial of respondents’ claims for funeral and bereavement aid granted under Section 4, Article XIII of their CBA constituted a diminution of benefits in violation of Article 100 of the Labor Code.

Held: Yes. A collective bargaining agreement (or CBA) refers to the negotiated contract between a legitimate labor organization and the employer concerning wages, hours of work and all other terms and conditions of employment in a bargaining unit. As in all contracts, the parties in a CBA may establish such stipulations, clauses, terms and conditions as they may deem convenient provided these are not contrary to law, morals, good customs, public order or public policy. Thus, where the CBA is clear and unambiguous, it becomes the law between the parties and compliance therewith is mandated by the express policy of the law.

Accordingly, the stipulations, clauses, terms and conditions of the CBA, being the law between the parties, must be complied with by them. The literal meaning of the stipulations of the CBA, as with every other contract, control if they are clear and leave no doubt upon the intention of the contracting parties.

It is further worthy to note that petitioner granted claims for funeral and bereavement aid as early as 1999, then issued a memorandum in 2000 to correct its erroneous interpretation of legal dependent under Section 4, Article XIII of the CBA. This notwithstanding, the 2001-2004 CBA35 still contained the same provision granting funeral or bereavement aid in case of the death of a legal dependent of a regular employee without differentiating the legal dependents according to the employee’s civil status as married or single. The continuity in the grant of the funeral and bereavement aid to regular employees for the death of their legal dependents has undoubtedly ripened into a company policy. With that, the denial of Alfante’s qualified claim for such benefit pursuant to Section 4, Article XIII of the CBA violated the law prohibiting the diminution of benefits.

Lepanto vs Lepanto Capataz Union (G.R. No. 157086 February 18, 2013)

Lepanto Consolidated Mining Company vs Lepanto Capataz Union
G.R. No. 157086 February 18, 2013

Facts: As a domestic corporation authorized to engage in large-scale mining, Lepanto operated several mining claims in Mankayan, Benguet. On May 27, 1998, respondent Lepanto Capataz Union (Union), a labor organization duly registered with DOLE, filed a petition for consent election with the Industrial Relations Division of the Cordillera Regional Office (CAR) of DOLE, thereby proposing to represent 139 capatazes of Lepanto. In due course, Lepanto opposed the petition, contending that the Union was in reality seeking a certification election, not a consent election, and would be thereby competing with the Lepanto Employees Union (LEU), the current collective bargaining agent. Lepanto pointed out that the capatazes were already members of LEU, the exclusive representative of all rank-and-file employees of its Mine Division.

Issues: Whether or not the filing of a motion for reconsideration on the decision by the DOLE Secretary is a condition precedent in a petition for certiorari.

Whether or not respondent LCU may form a separate union.

Held: Yes. To start with,  the requirement of the timely filing of a motion for reconsideration as a precondition to the filing of a petition for certiorari accords with the principle of exhausting administrative remedies as a means to afford every opportunity to the respondent agency to resolve the matter and correct itself if need be.

And, secondly, the ruling in National Federation of Labor v. Laguesma reiterates St. Martin’s Funeral Home v. National Labor Relations Commission, where the Court has pronounced that the special civil action of certiorari is the appropriate remedy from the decision of the National Labor Relations Commission (NLRC) in view of the lack of any appellate remedy provided by the Labor Code to a party aggrieved by the decision of the NLRC. Accordingly, any decision, resolution or ruling of the DOLE Secretary from which the Labor Code affords no remedy to the aggrieved party may be reviewed through a petition for certiorari initiated only in the CA in deference to the principle of the hierarchy of courts.

Yet, it is also significant to note that National Federation of Labor v. Laguesma also reaffirmed the dictum issued in St. Martin’s Funeral Homes v. National Labor Relations Commission to the effect that “the remedy of the aggrieved party is to timely file a motion for reconsideration as a precondition for any further or subsequent remedy, and then seasonably avail of the special civil action of certiorari under Rule 65.

Yes. Capatazes or foremen are not rank-andfile employees because they are an extension of the management, and as such they may influence the rank-and-file workers under them to engage in slowdowns or similar activities detrimental to the policies, interests or business objectives of the employers.

The word capataz is defined in Webster’s Third International Dictionary, 1986 as “a boss”, “foreman” and “an overseer”. The employer did not dispute during the hearing that the capatazes indeed take charge of the implementation of the job orders by supervising and instructing the miners, mackers and other rank-and-file workers under them, assess and evaluate their performance, make regular reports and recommends (sic) new systems and procedure of work, as well as guidelines for the discipline of employees. As testified to by petitioner’s president, the capatazes are neither rank-and-file nor supervisory and, more or less, fall in the middle of their rank. In this respect, we can see that indeed the capatazes differ from the rank-and-file and can by themselves constitute a separate bargaining unit.

Bordomeo vs CA (G.R. No. 161596 February 20, 2013)

Bordomeo etal vs Court of Appeals
G.R. No. 161596 February 20, 2013

Facts: In 1989, the IPI Employees Union-Associated Labor Union (Union), representing the workers, had a bargaining deadlock with the IPI management. This deadlock resulted in the Union staging a strike and IPI ordering a lockout. On December 26, 1990, after assuming jurisdiction over the dispute, DOLE Secretary Ruben D. Torres rendered hid decision reinstating the illegally dismissed employees with full backwages reckoning from December 8, 1989 and declaring the IPI Employees Union-ALU as the exclusive bargaining agent further directing the parties to enter into a new CBA. A motion for writ of execution was filed. Motion for partial reconsideration was filed by herein petitioners for amendatory/clarifications on the assailed order by DOLE Secretary Torres. Ultimately, on July 4, 2001, DOLE Secretary Patricia Sto. Tomas issued her Order37 affirming the order issued on March 27, 1998, and declaring that the full execution of the order of March 27, 1998 “completely CLOSED and TERMINATED this case.” Only herein petitioners Roberto Bordomeo, Anecito Cupta, Jaime Sarmiento and Virgilio Saragena assailed the July 4, 2001 order of Secretary Sto. Tomas by petition for certiorari in the CA.

Issues: Whether or not the the special civil action of certiorari is the proper remedy for the petitioners.

Whether or not the petitioners are entitled to separation pay and backwages.

Held: No. Even so, Rule 65 of the Rules of Court still requires the petition for certiorari to comply with the following requisites, namely:  (1) the writ of certiorari is directed against a tribunal, a board, or an officer exercising judicial or quasi-judicial functions; (2) such tribunal, board, or officer has acted without or in excess of jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction; and (3) there is no appeal or any plain, speedy, and adequate remedy in the ordinary course of law.

Jurisprudence recognizes certain situations when the extraordinary remedy of certiorari may be deemed proper, such as: (a) when it is necessary to prevent irreparable damages and injury to a party; (b) where the trial judge capriciously and whimsically exercised his judgment; (c) where there may be danger of a failure of justice; (d) where an appeal would be slow, inadequate, and insufficient; (e) where the issue raised is one purely of law; (f) where public interest is involved; and (g) in case of urgency. Yet, a reading of the petition for certiorari and its annexes reveals that the petition does not come under any of the situations. Specifically, the petitioners have not shown that the grant of the writ of certiorari will be necessary to prevent a substantial wrong or to do substantial justice to them.

In a special civil action for certiorari brought against a court with jurisdiction over a case, the petitioner carries the burden to prove that the respondent tribunal committed not a merely reversible error but a grave abuse of discretion amounting to lack or excess of jurisdiction in issuing the impugned order. Showing mere abuse of discretion is not enough, for the abuse must be shown to be grave.  Grave abuse of discretion means either that the judicial or quasi-judicial power was exercised in an arbitrary or despotic manner by reason of passion or personal hostility, or that the respondent judge, tribunal or board evaded a positive duty, or virtually refused to perform the duty enjoined or to act in contemplation of law, such as when such judge, tribunal or board exercising judicial or quasi-judicial powers acted in a capricious or whimsical manner as to be equivalent to lack of jurisdiction. Under the circumstances, the CA committed no abuse of discretion, least of all grave, because its justifications were supported by the history of the dispute and borne out by the applicable laws and jurisprudence.

Yes. Under the circumstances, the employment of the 15 employees or the possibility of their reinstatement terminated by March 15, 1995. Thereafter, their claim for separation pay and backwages beyond March 15, 1995 would be unwarranted. The computation of separation pay and backwages due to illegally dismissed employees should not go beyond the date when they were deemed to have been actually separated from their employment, or beyond the date when their reinstatement was rendered impossible. Anent this, the Court has observed in Golden Ace Builders v. Talde:

The basis for the payment of backwages is different from that for the award of separation pay. Separation pay is granted where reinstatement is no longer advisable because of strained relations between the employee and the employer.  Backwages represent compensation that should have been earned but were not collected because of the unjust dismissal.  The basis for computing backwages is usually the length of the employee’s service while that for separation pay is the actual period when the employee was unlawfully prevented from working.

Clearly then, respondent is entitled to backwages and separation pay as his reinstatement has been rendered impossible due to strained relations. As correctly held by the appellate court, the backwages due respondent must be computed from the time he was unjustly dismissed until his actual reinstatement, or from February 1999 until June 30, 2005 when his reinstatement was rendered impossible without fault on his part.

De Jesus vs Aquino (G.R. No. 164662 February 18, 2013)

De Jesus vs Aquino
G.R. No. 164662 February 18, 2013

Facts: On February 20, 2002, petitioner Ma. Lourdes De Jesus (De Jesus for brevity) filed with the Labor Arbiter a complaint for illegal dismissal against private respondents Supersonic Services Inc., (Supersonic for brevity), Pakistan Airlines, Gil Puyat, Jr. and Divina Abad Santos praying for the payment of separation pay, full backwages, moral and exemplary damages, etc. As Sales Promotion Officer, De Jesus was fully authorized to solicit clients and receive payments for and in its behalf, and as such, she occupied a highly confidential and financially sensitive position in the company; De Jesus was able to solicit several ticket purchases for Pakistan International Airlines (PIA) routed from Manila to various destinations abroad and received all payments for the PIA tickets in its behalf. Two memorandum were issued to De Jesus reminding her of her collectibles and her obligation to remit it to Supersonic. Despite the demands, De Jesus still failed to comply causing Supersonic to file a criminal case for Estafa which was countered by the petitioner by filing an illegal dismissal case.

Issues: Whether or not the dismissal of De Jesus is valid.

Whether or not Supersonic complied with the two notice rule required by law.

Held: Yes. Article 282 of the Labor Code enumerates the causes by which the employer may validly terminate the employment of the employee, viz:

Article 282.Termination by employer. – An employer may terminate an employment for any of the following causes:

  1. Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or representative in connection with his work;
  2. Gross and habitual neglect by the employee of his duties;
  3. Fraud or willful breach by the employee of the trust reposed in him by his employer or duly authorized representative;
  4. 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
  5. Other causes analogous to the foregoing.

The CA observed that De Jesus had not disputed her failure to remit and account for some of her collections, for, in fact, she herself had expressly admitted her failure to do so through her letters dated April 5, 2001 and May 15, 2001 sent to Supersonic’s general manager. Thereby, the CA concluded, she defrauded her employer or willfully violated the trust reposed in her by Supersonic. In that regard, the CA rightly observed that proof beyond reasonable doubt of her violation of the trust was not required, for it was sufficient that the employer had “reasonable grounds to believe that the employee concerned is responsible for the misconduct as to be unworthy of the trust and confidence demanded by [her] position.”

No. A careful consideration of the records persuades us to affirm the decision of the CA holding that Supersonic had not complied with the two-written notice rule.

It ought to be without dispute that the betrayal of the trust the employer reposed in De Jesus was the essence of the offense for which she was to be validly penalized with the supreme penalty of dismissal. Nevertheless, she was still entitled to due process in order to effectively safeguard her security of tenure. The law affording to her due process as an employee imposed on Supersonic as the employer the obligation to send to her two written notices before finally dismissing her. This requirement of two written notices is enunciated in Article 277of the Labor Code, as amended, which relevantly states:

Article 277. Miscellaneous provisions.–xxx x x x x

(b) Subject to the constitutional right of workers to security of tenure and their right to be protected against dismissal except for a just and authorized cause and without prejudice to the requirement of notice under Article 283 of this Code, the employer shall furnish the worker whose employment is sought to be terminated a written notice containing a statement of the causes for termination and shall afford the latter ample opportunity to be heard and to defend himself with the assistance of his representative if he so desires in accordance with company rules and regulations promulgated pursuant to guidelines set by the Department of Labor and Employment. Any decision taken by the employer shall be without prejudice to the right of the worker to contest the validity or legality of his dismissal by filing a complaint with the regional branch of the National Labor Relations Commission. The burden of proving that the termination was for a valid or authorized cause shall rest on the employer. The Secretary of the Department of Labor and Employment may suspend the effects of the termination pending resolution of the dispute in the event of a prima facie finding by the appropriate official of the Department of Labor and Employment before whom such dispute is pending that the termination may cause a serious labor dispute or is in implementation of a mass lay-off.
x x x x

and in Section 2 and Section 7, Rule I, Book VI of the Implementing Rules of the Labor Code. The first written notice would inform her of the particular acts or omissions for which her dismissal was being sought. The second written notice would notify her of the employer’s decision to dismiss her.  But the second written notice must not be made until after she was given a reasonable period after receiving the first written notice within which to answer the charge, and after she was given the ample opportunity to be heard and to defend herself with the assistance of her representative, if she so desired. The requirement was mandatory.