1.

PHILIPPINE TRANSMARINE VS LEGASPI

Respondent Legaspi

Employment:
o
As Utility Pastry on board the vessel "Azamara Journey" under the
employment of Petitioner PTC.
o
covered by CBA: maximum disability compensation of up to 60kUS$

Cardiac Arrest
o
While on board the vessel, he suffered "Cardiac Arrest S/P ICD
Insertation."
o
He was checked by ship's doctor and was prescribed medications.

He repatriated to receive further medical treatment and examination.

o
The company-designated physician assessed his condition to be Disability
Grade 2.
o
Since he was not satisfied, he filed for full and permanent disability
compensation before LA
LA

Favored respondent

PTC shall pay 80K or peso equivalent + 1,320 for sick wages + AF

80K was based on ITF Cruise Ship Model Agreement for Catering Personnel (not on
CBA)

Legaspi appealed.
NLRC

AFFIRMED LA.

Denied MFR.
During hearing for motion of execution

PTC agreed to pay 81K

Legaspi acknowledged receipt of the said amount and undertook to return it to

petitioner in the event the latter's petition for certiorari would be granted.

Remaining balance would be given on the next scheduled conference.

PTC filed petition for certiorari w/ CA

CA

(Unaware of NLRCs judgment and payment of US$81,320.00, and the writ of

execution issued by LA)

Partially granted PFC and modified NLRC.

Award of 60K based on the CBA between Celebrity Cruise Lines and Federazione
Italianaa Transporti CISL.
PTC

filed its Manifestation with Motion to Amend the Dispositive Portion

Contended that since it had already paid the total amount of US$89K, it was entitled
to the return of the excess payment in the amount of US$29K.

DENIED.

MFR DENIED.
PTC arguments:

Filed PFC within the 60-day reglementary period -> NLRC decisions X FINAL

NLRC cannot declare that a decision has become final and executory because the
period to file the petition has not yet expired.

Finality of the NLRC judgment did not render the petition moot and academic
because such is null and void ab initio.

Career Philippines ruling X applicable

Leonis ruling applies: satisfaction of the monetary award by the employer does not
render the PFC before the CA.
WON CA ERRED IN INVOKING THE RULING OF CAREER PHILIPPINES? YES.
WON LEGASPI SHOULD RETURN THE EXCESS PAYMENT? YES.
PFC RULING NOT MOOT

In cases where PFC is filed after the expiration of the 10-day period under the 2011
NLRC Rules of Procedure but within the 60-day period under Rule 65, CA can grant
the petition and modify, nullify and reverse a decision or resolution of the NLRC.

Although the petition for certiorari was not filed within the 10-day period, petitioner
timely filed it before the CA within the 60-day reglementary period under Rule 65.
CAREER X APPLICABLE

"Conditional settlement" = an amicable settlement of the case resulting in the

mootness of the PFC

Ruled against employer because the conditional satisfaction of judgment signed by

the parties was highly prejudicial to the employee.
o
Payment of the monetary award was without prejudice to the right of the
employer to file a petition for certiorari and appeal, while the employee
agreed that she would no longer file any complaint or prosecute any suit of
action against the employer after receiving the payment.

Receipt of the Judgment Award with Undertaking was fair to both the employer and
the employee.
o
Leonis ruling: Agreement stipulated that respondent should return the
amount to petitioner if the PFC would be granted but without prejudice to
respondent's right to appeal. The agreement, thus, provided available
remedies to both parties.

PFC was not rendered moot despite PTCs satisfaction of the judgment award, as
Legaspi had obliged himself to return the payment if the PFC would be granted.
RETURN OF EXCESS PAYMENT

The voluntary agreement is binding on the parties and may not later be disowned
simply because of a change of mind.

Legaspi agreed to the stipulation that he would return the amount paid to him
in the event that the petition for certiorari would be granted.
o
Since the petition was partially granted by CA, respondent must comply
with the condition to return the excess amount.

To allow now respondent to retain the excess money judgment would amount
to his unjust enrichment to the prejudice of petitioner.

Respondent is ordered return the excess amount of payment in the sum of US$29K
to PTC.
2.
RADIO MINDANAO NETWORK, INC. and ERIC S. CANOY, Petitioners vs.
DOMINGO Z. YBAROLA, JR. and ALFONSO E. RIVERA, JR., Respondents
Facts: Respondents Domingo Z. Ybarola, Jr. and Alfonso E. Rivera, Jr. were hired on June 15,
1977 and June 1, 1983, respectively, by Radio Mindanao Network Inc. (RMN). They eventually
became account managers, soliciting advertisements and servicing various clients of RMN. On
September 15, 2002, the respondents services were terminated as a result of RMNs
reorganization/restructuring; they were given their separation pay P 631,250.00 for Ybarola,
and P 481,250.00 for Rivera. Sometime in December 2002, they executed release/quitclaim
affidavits. Dissatisfied with their separation pay, the respondents filed separate complaints
(which were later consolidated) against RMN and its President, Eric S. Canoy, for illegal
dismissal with several money claims, including attorneys fees. The respondents argued that
the release/quitclaim they executed should not be a bar to the recovery of the full benefits due
them; while they admitted that they signed release documents, they did so due to dire
necessity. On July 18, 2007, Labor Arbiter Patricio Libo-on dismissed the illegal dismissal

complaint, but ordered the payment of additional separation pay to the respondents. The labor
arbiter adjusted the separation pay award based on the respondents Certificates of
Compensation Payment/Tax Withheld. On appeal by the petitioners to the National Labor
Relations Commission (NLRC), it ruled that the withholding tax certificate cannot be the basis
of the computation of the respondents separation pay as the tax document included the
respondents cost-of-living allowance and commissions; as a general rule, commissions cannot
be included in the base figure for the computation of the separation pay because they have to
be earned by actual market transactions attributable to the respondents, as held by the Court
in Soriano v. NLRC7 and San Miguel Jeepney Service v. NLRC. From the NLRC, the
respondents sought relief from the CA through a petition for certiorari under Rule 65 of the
Rules of Court. In its decision of February 17, 2011, the CA granted the petition and reinstated
the labor arbiters separation pay award. Hence, this petition for motion for reconsideration.
Issues: Whether or not the CA committed reversible error in : (1) failing to declare that Canoy
is not personally liable in the present case; (2) disregarding the rule laid down in Talam v.
National Labor Relations Commission on the proper appreciation of quitclaims; and (3)
disregarding prevailing jurisprudence which places on the respondents the burden of proving
that their commissions were earned through actual market transactions attributable to them.
Ruling: The motion for reconsideration is unmeritorious. The motion raises substantially the
same arguments presented in the petition. The petitioners contention that respondents
commissions are profit-sharing payments which do not form part of their salaries is untenable.
That the salary structure of the respondents was such that they only received a minimal
amount as guaranteed wage; a greater part of their income was derived from the commissions
they get from soliciting advertisements; these advertisements are the "products" they sell. As
the CA aptly noted, this kind of salary structure does not detract from the character of the
commissions being part of the salary or wage paid to the employees for services rendered to
the company.
The petitioners reliance on our ruling in Talam v. National Labor Relations Commission,17
regarding the "proper appreciation of quitclaims," as they put it, is misplaced. In this case, as
the CA noted, the separation pay the respondents each received was deficient by at least P
400,000.00; thus, they were given only half of the amount they were legally entitled to. To be
sure, a settlement under these terms is not and cannot be a reasonable one, given especially
the respondents length of service 25 years for Ybarola and 19 years for Rivera.
Lastly, the petitioners are estopped from raising the issue of Canoy's personal liability. They did
not raise it before the NLRC in their appeal from the labor arbiter's decision, nor with the CA in
their motion for reconsideration of the appellate court's judgment.
3.PERT/CPM MANPOWER EXPONENT CO., INC., petitioner, vs. ARMANDO A. VINUYA, et
al, respondents. G.R. No. 197528. September 5, 2012.
FACTS: On March 5, 2008, respondent Vinuya et al. filed a complaint for illegal dismissal
against the petitioner Pert/CPM and its President with labor arbiter alleging among others that
the agency deployed them to work as aluminium fabricator/installer for the agencys principal,
Modern Metal in Dubai, United Arab Emirates for a two-year employment whose contracts
were approved by the POEA providing for nine-hours working day, salary of 1,350 AED with
overtime pay, food allowance, free and suitable housing (four to a room), free transportation,
free laundry and free medical and dental services. However, on April 2, 2007, Modern Metal
gave respondents, except Era, appointment letters different from that of originally signed,
increasing their employment terms and reducing their salaries and allowances and removing
certain benefits. Further, the working conditions were not as promised and they repeatedly
complained with their agency about their predicament but to no avail. Respondents resigned
from their job citing personal/family problems for their resignation except for Era who
mentioned the real reason which is due to the company policy. After several weeks, petitioner
repatriated the respondent to the Philippines who shouldered their own airfare except for
Ordovez and Enjambre. The agency countered that the respondents were not illegally
dismissed alleging that the respondents voluntarily resigned from their employment to seek a

better paying job. The agency furthered alleged that the respondents even voluntarily signed
affidavits of quitclaim and release. Labor Arbiter dismissed the complaint finding that the
respondent voluntarily resigned from their job. Respondent appealed to the NLRC which
reversed the decision of the Labor Arbiter and found that the respondents were illegally
dismissed. NLRC also pointed out that the signing of a different employment contract in Dubai
is illegal. Consequently NLRC ordered the agency and the principal to pay, jointly and severally
the respondents salary, placement fee, and exemplary damages. The petitioner filed a motion
for reconsideration which was denied by the NLRC but modified their judgment adjusting the
awards particularly the payment of their salaries in the light of the Courts ruling in Serrano
striking down the clause in Section 10, paragraph 5 of the RA 8042 which limits the entitlement
of illegally dismissed OFW. The agency again moved for reconsideration reiterating its earlier
argument and questioned the applicability of the Serrano ruling because it is not yet final and
effective but was denied by the NLRC. Petitioner appealed with CA which upheld the decision
of the NLRC finding the resignation letter as dubious.
ISSUE: Whether or not the Serrano ruling which declared the subject Section 10 of RA 8042
unconstitutional can be given retroactive application in the present case;whether or not RA
10022, which was enacted on March 8, 2010 restoring the subject clause in Section 10 of RA
8042 being amendatory in nature can be applied retroactively
RULING: The SC held that the Serrano ruling can be given retroactive application as resolved
in Yap vs. Thenamaris Ships Management in the interest of equity and that the Serrano ruling
is an exemption to the doctrine of operative fact. Moreover, the SC held that the amendment
introduced by R.A. 10022 cannot be given retroactive effect not only because there is no
express declaration of retroactivity of the law, but because the retroactive application will result
in an impairment of right that had accrued to the respondents by virtue of the Serrano Ruling.
The SC reiterated that all statutes are to be construed as having only a prospective application,
unless the purpose and intention of the legislature to give them retrospective effect are
expressly declared or are necessarily implied from the language used. HELD: The petition is
DENIED. The assailed decision and resolution were AFFIRMED.
4. Gapayo vs Fulo
Facts: On November 4, 1997 Jaime Fulo died of acute renal failure secondary to 1 st degree
burn 70% secondary electrocution while doing repairs at the residence and business
establishment of petitioner located at San Julian, Irosin, Sorsogon
Petitioner extended some financial assistance to the private respondent (Widow of Jaime
Fulo). Private respondent then signed an affidavit stating that she will not be holding said
petitioner responsible for the death of her late husband, therefore waiving the right of filing an
criminal or civil action against them.
Both parties then signed a compromise agreement which stated among others a (1) payment
of 40,000 pesos to the surviving spouse and (2)in doing so, the surviving spouse having
received said amount shall release and discharge the employer from any and all claims that
maybe due the victim in connection with the victims employment threat.
Thereafter Private respondent then filed for social security benefits from the SSS, which the
SSS then denied stating that the deceased was not a registered member of the SSS.
The SSS then conducted a field investigation to clarify the status of employment of the
deceased. It was found that the deceased was a farm employee on extra basis, sometimes
allowed to work in the farm as harvester of abaca and at times as repairman for the house. He
is paid remuneration of 50 pesos a day usually in the afternoon.
Consequently the SSS demanded petitioner to remit social security contributions which was
denied by the petitioner stating Fulo was not his employee and states that he was merely an
independent contractor whose tasks were not subject to petitioners control and supervision.
Hence petitioner had no obligation to report formers demise to SSS.
SSS then filed a Petition-in-intervention before the SSC wherein the latter rendered a
resolution stating that Fulo was indeed an employee of the petitioner and ordered the latter to
pay for contributions for SSS death benefits.

Aggrieved Petitioner appealed to the CA.

CA rendered a decision in favor of private respondent stating that the deceased was an
employee of petitioner and there be entitled to compulsory coverage under social security law.
The CA states that it is not essential for the employer to actually supervise the performance of
duties of the employee, it is sufficient that the former has a right to wield power. Another fact to
consider is that Petitioner entered into a Compromise Agreement stating / admitting he was the
employer of the deceased. This admission was interpreted by the CA as evidence of
employee-employer relationship.
Hence petition to the SC.
Issue: Whether or not there exists an employer-employee relationship between petitioner and
Fulo (deceased) that would merit an award of benefits in favor of the privare respondent under
social security laws.
Held: The court held that considering the timeframe, Fulo was working under petitioner for 14
years and provided and performed diverse task for the petitioner that indicated an
indispensability of service to the business of the latter. It was also acknowledged that the
petitioner himself admitted said employee-employer relationship during the Compromise
Agreement between the petitioner and Private Respondent. Even if petitioner claims that Fulo
was merely a pakyaw based employee, and the Compromise Agreement was made only for
peace the court held that seasonal employees may be considered as regular employees and
that Pakyaw workers are considered regular employees, provided they are subject to control of
the petitioner.
Hence, Deceased Fulo and Petitioner have employee-employer relationship and is then
covered by the Social Security Act and thus rules in favor of the Private Respondent.
5. Esguerra vs Valle Verde
Facts: Dolores Esguerra is the cost control supervisor in valle verde country club. She was
tasked to oversee the two seminars held in two function rooms. Money was remitted for only
one of the rooms. There were also unauthorized charges of food on the account of one of the
guests, Judge Bonifacio. Esguerra, along with the employees assigned to the rooms were
summoned to explain. She explained that it had been her daughter (who was assigned as a
food checker) who lost the money. To settle the matter, Esguerra paid the unaccounted amount
as soon as her daughter informed her about it. Esguerra also explained the unauthorized
charging of food on Judge Bonifacio's account. She alleged that Judge Bonifacio took pity on
her and told her to take home some food and to charge it on his account.
Valle Verde - found Esguerra's explanation unsatisfactory and terminated her.
Esguerra filed a complaint against valle verde. Esguerra argues that the appellate court erred
in ruling that she had been validly dismissed on the ground of loss of trust and confidence. She
alleges that she was only a regular employee and did not occupy a supervisory position vested
with trust and confidence. Esguerra also questions the manner of dismissal since Valle Verde
failed to comply with procedural requirements.
Labor arbiter dismissed the complaint; NLRC, CA affirms.
ISSUE: whether CA erred in affirming the NLRCs decision.
HELD: No. petition is without merit. There was a valid notice and hearing. Esguerra occupied a
position of trust and confidence. Esguerra held the position of Cost Control Supervisor and had
the duty to remit to the accounting department the cash sales proceeds from every transaction
she was assigned to. This is not a routine task that a regular employee may perform; it is
related to the handling of business expenditures or finances. For this reason, Esguerra
occupies a position of trust and confidence a position enumerated in the second class of
positions of trust. Any breach of the trust imposed upon her can be a valid cause for dismissal.
She had no custody of the cash sales since it was not part of her duties as a food checker. It
was Esguerra's responsibility to account for the cash proceeds; in case of problems, she
should have promptly reported it, regardless of who was at fault. Instead, she settled the
unaccounted amount only after the accounting department informed her about the discrepancy,
almost one month following the incident. Esguerra's failure to make the proper report reflects
on her irresponsibility in the custody of cash for which she was accountable, it was her duty to

account for the sales proceeds, and she should have known about the missing amount
immediately after the event.
The unauthorized charging on Judge Bonifacios account should not be considered favorably. It
is highly unethical for an employee to bring home food intended to be sold to customers. At any
rate, her explanation is self-serving and cannot be believed; the numerous written testimonies
of the other co-workers never even mentioned it.
6. PRUDENTIAL GUARANTEE AND ASSURANCE EMPLOYEE LABOR UNION and
SANDY T. VALLOTA vs. NLRC
Facts:

Petition for review on certiorari under Rule 45 filed by petitioners and Vallota seeking
to set aside the CA decision

Atty. Rillo (HR Manager) informed Apostol that PGAI was going to conduct an onthe-spot security check in the Information and Technology (IT) Department.

After exploring the contents of all the folders and subfolders in the My Documents
folder, Gutierrez apparently did not find anything unusual with Vallotas computer and
said Wala naman, saan dito? Retizos insisted, Nandyan yan, and took over the
inspection until she found a folder named MAA.

On November 14, 2005, Vallota received a memorandum directing him to explain

within 72 hours why highly confidential files were stored in his computer. The same
memorandum also informed him that he was being placed under preventive
suspension for 30 days.

A second memorandum extension of his preventive suspension for another 30

days, in view of the fact that the management needed more time to evaluate the
administrative case against him.

Vallota responded in writing on November 21, 2005. Three days later, on November
24, 2005, PGAI sent him another memorandum requesting further details on some of
the matters he raised in his response.

In a letter dated December 6, 2005, Vallota requested a conference, to be attended

by a Union representative and counsel.

In reply, PGAI sent Vallota another memorandum dated December 7, 2005, which,
among others, set a new deadline for Vallota to submit his reply and evidence in his
defense.

Meanwhile, the Union sent a letter to PGAI President Philip K. Rico (Rico) requesting
that a grievance committee be convened and that the contents of the computers of
other IT personnel be similarly produced. The request for the convening of a
grievance committee was ignored.

On December 21, 2005, Vallota was given a notice of termination of his employment
effective January 10, 2006 on the ground of loss of trust and confidence.

Thus, the petitioners filed a complaint for illegal dismissal with claims for full
backwages, moral and exemplary damages, and attorneys fees to the LA

The LA held that PGAI failed to meet its burden of evidence, and the conflicting
claims of the parties were resolved in favor of Vallota for failure of PGAI to adduce
substantial evidence to support its claim. The LA further held that the dismissal was
not commensurate to the misconduct complained of, especially considering that it
was Vallotas first offense.

Finally, the LA ruled that Vallota was denied due process since the respondents
refused to conduct a hearing, despite Vallotas request, to thresh out the matters
raised by him in his memoranda.

NLRC NLRC ruled that the dismissal was valid, it still directed the respondents to
grant Vallota financial assistance of one-half (1/2) month pay for every year of his ten
(10) years of service.
Issues:

Whether Vallota was validly dismissed on the ground of loss of trust and confidence; (c) the ample opportunity to be heard standard in the Labor Code prevails over the hearing or
conference requirement in the implementing rules and regulations.
and

Whether the requirements of procedural due process for termination were observed In this case, petitioners written response to the Prerequisite Notice provided her with an
avenue to explain and defend her side and thus served the purpose of due process.
Held:
That there was no hearing, investigation or right to appeal, which petitioner opined to be

No.
violation of company policies, is of no moment since the records are bereft of any showing that

Requirement No. 1 Position of trust and confidence: Yes.

there is an existing company policy that requires these procedures with respect to the
o
Vallotas position as Junior Programmer is analogous to the second class
termination of a CHR Director like petitioner or that company practice calls for the same. There
of positions of trust and confidence (Development of internal programs as was also no request for a formal hearing on the part of petitioner.
required by the organization). Though he did not physically handle money As she was served with a notice apprising her of the charges against her and also a
or property, he became privy to confidential data or information by the subsequent notice informing her of the managements decision to terminate her services after
nature of his functions.
respondents found her written response to the first notice unsatisfactory, petitioner was clearly

Requirement No. 2: Act leading to loss of confidence: No

afforded her right to due process.
o
No other evidence presented to prove fraud in the manner of securing or 8. NARANJO vs. BIOMEDICA HEALTH CARE, INC.
obtaining the files found in Vallotas computer. In fact, aside from the FACTS: Respondent Biomedica Health Care, Inc. (Biomedica) was, during the material period,
presence of these files in Vallotas hard drive, there was no other evidence engaged in the distribution of medical equipment. Respondent Carina "Karen" J. Motol (Motol)
to prove any gross misconduct on his part. There was no proof either that was then its President.
the presence of such files was part of an attempt to defraud his employer Petitioners were former employees of Biomedica. On November 7, 2006, which happened to
or to use the files for a purpose other than that for which they were be Motol's birthday, petitioners with two other employees, Alberto Angeles (Angeles) and
intended.
Rodolfo Casimiro (Casimiro) were all absent for various personal reasons.

Yes.
De Guzman was allegedly absent due to loose bowel movement, Pimentel for an
o
Twin requisites complied with,
ophthalmology check-up, Bardaje due to migraine, Cruz for not feeling well, and Naranjo
o
BUT that the petitioners expressly requested a conference or a convening because he had to attend a meeting at his child's school.
of a grievance committee, following the Courts ruling in the Perez case, These are the same employees who filed a letter-complaint addressed to the National Capital
which was later cited in the recent case of Lopez v. Alturas Group of Region-Department of Labor and Employment (DOLE) against Biomedica for lack of salary
Companies, such formal hearing became mandatory. After PGAI failed to increases, failure to remit Social Security System and Pag-IBIG contributions, and violation of
affirmatively respond to such request, it follows that the hearing the minimum wage law, among other grievances.
requirement was not complied with and, therefore, Vallota was denied his Later that day, petitioners reported for work. They were, however, refused entry and told to start
right to procedural due process.
looking for another workplace.The next day, they were also denied entry for work.
o
Vallota is entitled to reinstatement, but in view of the strained relations Correspondingly, Biomedica issued a notice of preventive suspension and notices to explain
between Vallota and PGAI, however, it is not in the best interest of the within 24 hours (Notices) to petitioners. It was alleged that the accused the petitioners
parties, nor is it advisable or practical to order reinstatement. Separation conducted an illegal strike and were accordingly directed to explain why they should not be
pay equivalent to one (1) month salary for every year of service should be held guilty of and dismissed for violating the company policy against illegal strikes under Article
awarded as an alternative in addition to backwages plus 10% of total XI, Category Four, Sections 6, 8, 12, 18 and 25 of the Company Policy. That said illegal act-in
conspiracy with your other co-employees, paralyzed the company operation on that day and
monetary award for attorneys fees
resulted to undue damage and prejudice to the company and is direct violation.
7. REYES-RAYEL VS PHIL LUEN THAI
Facts: ON SEPT. 12, 2001, petitioner Flordeliza Maria Reyes-Rayel, a c corporate human Only Angeles and Casimiro submitted their written explanation for their absence wherein they
resources (CHR) director, was dismissed from the service by respondents Philippine Luen Thai alleged that petitioners forced them to go on a "mass leave" while asking Biomedica for
Holdings Corp. and L&T International Group Philippines, Inc. for loss of confidence in her forgiveness for their actions.
ability to promote their interests. She filed a complaint for illegal dismissal, praying for On November 20, 2006, petitioners filed a Complaint with the NLRC for constructive dismissal
separation pay, 13th month pay, moral and exemplary damages and attorneys fees. The and nonpayment of salaries, overtime pay, 13th month pay as well as non-remittance of SSS,
petitioner claimed, among others, that her dismissal was effected without the observance of Pag-IBIG and Philhealth contributions as well as loan payments.
Thereafter, Biomedica served Notices of Termination on petitioners. All dated November 29,
due process since she was not afforded a hearing.
2006.
Issue: Does this claim find merit?
Later, on March 31, 2008, the Labor Arbiter issued a Decision, that petitioners engaged in a
Ruling: No.
The following are the guiding principles in connection with the hearing requirement in dismissal mass leave akin to a strike.Thus, were validly dismissed.
Petitioners appealed the Labor Arbiter's Decision to the NLRC which rendered a modificatory
cases:
(a) ample opportunity to be heard means any meaningful opportunity (verbal or written) given Decision, and so declared petitioners to have been illegally dismissed.
to the employee to answer the charges against him and submit evidence in support of his Biomedica appealed the case to the CA, which reinstated the labor arbiters decision. The CA
ruled that, indeed, petitioners staged a mass leave in violation of company policy. This fact,
defense, whether in a hearing, conference or some other fair, just and reasonable way.
(b) a formal hearing or conference becomes mandatory only when requested by the employee coupled with their refusal to explain their actions, constituted serious misconduct that would
in writing or substantial evidentiary disputes exist or a company rule or practice requires it, or justify their dismissal. Hence, the instant appeal.
ISSUES: Whether or not the petitioner were illegally dismissed.
when similar circumstances justify it.

HELD: YES. Petitioners were illegally dismissed. It bears pointing out that in the dismissal of
an employee, the law requires that due process be observed. Such due process requirement is
two-fold, procedural and substantive, that is, "the termination of employment must be based on
a just or authorized cause of dismissal and the dismissal must be effected after due notice and
hearing." In the instant case, petitioners were not afforded both procedural and substantive due
process.
Art. 277 (b) of the Labor Code contains the procedural due process requirements in the
dismissal of an employee:
Art. 277.Miscellaneous Provisions. . . .
(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 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.
On the other hand, Rule XIII, Book V, Sec. 2 I (a) of the Implementing Rules and Regulations
of the Labor Code states: EAaHTI
SEC. 2.Standards 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 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 he so desires is given opportunity to respond to the charge, present his evidence, or
rebut the evidence presented against him.
(c)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 the instant case, the notice specifying the grounds for termination dated November 9, 2006,
merely charged petitioners with conducting an illegal strike, not a mass leave, without
specifying the exact acts that the company considers as constituting an illegal strike or violative
of company policies. Such allegation falls short of the requirement in King of Kings Transport,
Inc. of "a detailed narration of the facts and circumstances that will serve as basis for the
charge against the employees." A bare mention of an "illegal strike" will not suffice.
Further, while Biomedica cites the provisions of the company policy which petitioners
purportedly violated, it failed to quote said provisions in the notice so petitioners can be
adequately informed of the nature of the charges against them and intelligently file their
explanation and defenses to said accusations. The notice is bare of such description of the
company policies. Worse, respondent Biomedica did not even quote or reproduce the company
policies referred to in the notice as pointed out by the CA.
Moreover, the period of 24 hours allotted to petitioners to answer the notice was severely
insufficient and in violation of the implementing rules of the Labor Code. Under the
implementing rule of Art. 277, an employee should be given "reasonable opportunity" to file a
response to the notice.
In addition, Biomedica did not set the charges against petitioners for hearing or conference in
accordance with Sec. 2, Book V, Rule XIII of the Implementing Rules and Regulations of the
Labor Code. While petitioners did not submit any written explanation to the charges, it is
incumbent for Biomedica to set the matter for hearing or conference to hear the defenses and
receive evidence of the employees.

Lastly, Biomedica again deviated from the dictated contents of a written notice of termination
as laid down in Sec. 2, Book V, Rule XIII of the Implementing Rules that it should embody the
facts and circumstances to support the grounds justifying the termination.The November 26,
2006 Notice of Termination issued by Biomedica miserably failed to satisfy the requisite
contents of a valid notice of termination, as it simply mentioned the failure of petitioners to
submit their respective written explanations without discussing the facts and circumstances to
support the alleged violations of Secs. 6, 8, 12, 18 and 25 of Category Four, Art. XI of the
alleged company rules.
In any event, petitioners were also not afforded substantive due process, that is, they were
illegally dismissed. To justify the dismissal of an employee on the ground of serious
misconduct, the employer must first establish that the employee is guilty of improper conduct,
that the employee violated an existing and valid company rule or regulation, or that the
employee is guilty of a wrongdoing. In the instant case, Biomedica failed to even establish that
petitioners indeed violated company rules, failing to even present a copy of the rules and to
prove that petitioners were made aware of such regulations.
Petitioners did not stage a mass leave. The accusation is for engaging in a mass leave
tantamount to an illegal strike. The phrase "mass leave" may refer to a simultaneous availment
of authorized leave benefits by a large number of employees in a company. Thus, it is
undeniable that going on leave or absenting one's self from work for personal reasons when
they have leave benefits available is an employee's right. In the factual milieu at bar, Biomedica
did not submit a copy of the CBA or a company memorandum or circular showing the
authorized sick or vacation leaves which petitioners can avail of. Neither is there any document
to show the procedure by which such leaves can be enjoyed. Absent such pertinent
documentary evidence, the Court can only conclude that the availment of petitioners of their
respective leaves on November 7, 2006 was authorized, valid and in accordance with the
company or CBA rules on entitlement to and availment of such leaves. Moreover, a mass leave
involves a large number of people or in this case, workers. Having failed to show that there
was a mass leave, the Court concludes that there were only individual availment of their leaves
by petitioners and they cannot be held guilty of any wrongdoing, much less anything to justify
their dismissal from employment.
Petitioners did not go on strike as well. Art. 212 (o) of the Labor Code defines a strike as
"any temporary stoppage of work by the concerted action of employees as a result of any
industrial or labor dispute." Moreover, Biomedica did not prove that the individual absences can
be considered as "temporary stoppage of work." Biomedica's allegation that the mass leave
"paralyzed the company operation on that day" has remained unproved. It is erroneous,
therefore, to liken the alleged mass leave to an illegal strike much less to terminate petitioners'
services for it.
Biomedica has failed to adduce substantial evidence to prove that petitioners' dismissal from
their employment was for a just or authorized cause. The conclusion is inescapable that
petitioners were illegally dismissed. Given the illegality of their dismissal, petitioners are
entitled to reinstatement and backwages and owing to the strained relations between the
parties, separation pay in lieu of reinstatement would be proper.
9. DR. ERNESTO I. MAQUILING, petitioner, vs. PHILIPPINE TUBERCULOSIS SOCIETY,
INC., respondent.
Facts:

Petition for review of CA decision reversing the findings of NLRC and LA declaring
the dismissal of petitioner to be illegal

Dr. Maquiling
o
Employed by PTSI
o
Dismissed after 23 years of service for loss of trust and confidence
o
Filed complaint for reinstatement or payment of full backwages and
separation pay and moral and exemplary damages

o
o

Issue:

Held:

Dr. Maquiling received a memo directing him to submit within 5 days from
notice an explanation on the following matters

The delayed GSIS remittances;

The reported deficit of P7.3 million appearing in our financial

statement for 1990;

The expenses you approved and incurred in connection with the

Dale Carnegie and Silva Mind Control Seminar;

The P3.7 million miscellaneous expenses appearing in our

financial statement; and

Your reasons for renewing our service contract with Ultra

Dr. Maquiling submitted his written reply.
Dr. Maquiling received a letter-notice dated 8 June 1991 informing him that
the PTS Executive Committee approved Sorianos findings and
recommendations calling for his dismissal effective immediately, without
any retirement benefits.

WON he was dismissed for just cause and

WON PTSI was remiss in its duty to observe procedural due process in effecting the
dismissal of Dr. Maquiling.

Yes. Lack of trust

o
Delayed GSIS remittances as provided by law
o
The P7.3 million deficit in PTS 1990 financial statements to Dr. Maquilings
failure to consider the realities of the financial condition of the institution
o
By reason of the Ultra Clean contract, PTS was dragged into a labor
controversy for illegal dismissal which eventually made it liable for
backwages and differentials to employees of Ultra Clean
o
ETC

No.
o
It must be noted that the first notice dated 2 April 1991 is a mere
instruction to explain the matters enumerated therein. It did not apprise Dr.
Maquiling of any investigation to be conducted or being conducted that will
warrant his dismissal from service if found guilty of charges specified
therein.
o
The Agabon doctrine enunciates the rule that if the dismissal is for just
cause but statutory due process was not observed, the dismissal should
be upheld. While the procedural infirmity cannot be cured, it should not
invalidate the dismissal.
o
However, the employer should be held liable for non-compliance with the
procedural requirements of due process.
o
The violation of the petitioners right to statutory due process by the private
respondent warrants the payment of indemnity in the form of nominal
damages 30K
10. ELECTRO SYSTEM INDUSTRIES CORPORATION, petitioner, vs. NATIONAL LABOR
RELATIONS COMMISSION and NOEL BALTAZAR A. SUMACULUB
Facts: On March 17, 1994, Noel Sumaculub was employed as driver of Electrosystem with a
monthly salary of P5,700.00. During said employment, he figured in three vehicular accidents
by reason of negligence-while driving a company car on April 18, 1997, he hit a motorcross
bike driven by Gilbert Pea; on December 13, 1997, he bumped the rear portion of a Toyota
Corolla car driven by Amelia Flores; and on August 7, 1998, he crashed into a Kalayaan
Flyover post in Makati, Metro Manila. Petitioner thus incurred expenses in settling the damages

caused by said mishaps. On August 10, 1998, he was dismissed for repeated violation of
company rules against reckless driving of company vehicles. He then filed an illegal
termination case before the Labor Arbiter which declared that the dismissal of private
respondent is invalid. Said decision was affirmed by the National Labor Relations Commission
(NLRC). On appeal, the Court of Appeals ruled that the termination of Sumaculub is valid
because there exists a just cause to dismiss him from employment. However, it declared that
petitioner failed to comply with the requisite statutory due process in terminating private
respondent. Hence, Electrosystem was ordered to pay backwages from the date of the
dismissal until finality of the decision. Electro filed a motion for reconsideration, only to be
denied.
Issue: Whether or not there was an observance of the 2- notice rule in the dismissal of
Sumaculub
Held: NO. In dismissing an employee, the employer has the burden of proving that the former
worker has been served two notices: (1) one to apprise him of the particular acts or omissions
for which his dismissal is sought, and (2) the other to inform him of his employer's decision to
dismiss him. In the case at bar, the first notice issued by Electrosystem fell short of the
requirement of the law because it merely referred to the section of the company rule allegedly
violated by Sumaculub. The notice failed to specify the penalty for the charges which is
dismissal, and to indicate the precise act or omission which constituted as the ground for which
dismissal is sought. There is no showing that Sumaculub was actually served with the required
two notices. The first notice did not bear the signature of private respondent. In the second
notice, there was a notation that private respondent refused to sign. This notation is not
sufficient proof that petitioner attempted to serve the second notice to private respondent.
Electrosytem's bare assertions that Sumaculub was furnished with copies of the notices and
that he attended the hearing on the charges, it presented no other proof to establish the same.
It was not able to discharge the burden of proving compliance with the employee's right to
statutory due process in termination proceedings. However, it should not be made to pay
Sumaculubs backwages but it is obligated to indemnify Sumaculub for the violation of his
statutory rights.