illegal dimissal

Auza Jr. vs MOL Philippines (GR No. 175481 November 21, 2012)

Auza Jr. vs MOL Philippines Inc.
GR No. 175481 November 21, 2012

Facts: Respondent MOL is a common carrier engaged in  transporting cargoes to and from  the different parts of the world.   On October 1, 1997, it employed Auza and Jeanjaquet as Cebu’s  Branch Manager and  Administrative Assistant, respectively.  It also employed Otarra  as its Accounts Officer on November 1, 1997.  On October 14, 2002, Otarra  tendered her  resignation  letter effective November 15, 2002 while Auza and Jeanjaquet submitted their resignation letters on October 30, 2002 to take  effect on November 30, 2002.  Petitioners were then given their separation pay and  the monetary  value of  leave credits, 13th  month pay, MOL cooperative shares and unused dental/optical  benefits as shown in documents entitled “Remaining  Entitlement Computation,”  which documents were signed by each of them  acknowledging receipt of such benefits.  Afterwhich, they  executed  Release and  Quitclaims  and then issued  Separation  Clearances. In February 2004 or almost 15 months after their severance from employment, petitioners filed separate Complaints  for illegal dismissal before the Arbitration Branch of the NLRC against respondents and MOL’s Manager for Corporate Services, George  Dolorfino alkeging that the reason for their resignations were that the clmpany informed everyone that it is downsizing ang even has to close the said branch which did not happen.

Issue: Whether or not petitioners were constructively dismissed.

Held: No. “Resignation is the formal pronouncement or relinquishment of an office.”   The overt act of relinquishment should be coupled with an intent to relinquish, which intent could  be inferred from the acts  of the employee before and after  the alleged resignation.

It appears that petitioners, on their own  volition, decided to  resign from their positions after being informed of the management’s  decision that the Cebu branch would eventually be  manned by a mere skeletal force.  As proven by the email correspondences presented, petitioners  were fully aware and had, in fact, acknowledged that  Cebu branch has been incurring  losses and was already unprofitable to operate.   Note that there was evidence produced  to prove that indeed the Cebu branch’s productivity had  deteriorated as shown in a Profit and Loss Statement  for the years 2001 and 2002.   Also, there was  a substantial reduction  of  workforce as  all of  the Cebu  branch staff  and personnel, except one, were not retained.  On  the other hand, petitioners’ assertions that the Cebu  branch was performing well are not  at  all  substantiated.   What they  presented  was a document entitled “1999 Performance Standards”,  which only provides for performance objectives but tells nothing about the branch’s progress.  Likewise, the Cebu Performance Reports  submitted  which showed outstanding company performance only pertained to  the year 1999 and the first  quarter of year 2000.  No other financial documents were submitted to show that such progress continued until year 2002.  

Ample jurisprudence provides that subsequent and substantial compliance may call for the relaxation of the rules.   Indeed, “imperfections of form and technicalities of procedure  are to  be disregarded,  except where substantial rights would otherwise be prejudiced.”  Due to petitioners’ subsequent and substantial compliance, we thus apply the rules liberally  in order not to frustrate the ends of justice. 


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.