Republic of the PhilippinesSUPREME COURTManilaSECOND DIVISIONG.R. No. 162994 September 17, 2004DUNCAN ASSOCIATION O DETAI!MAN"PTG#O $%& PEDRO A. TECSON, petitioners, vs.G!A'O #E!!COME P(I!IPPINES, INC., Respondent.R E S O! " I O NTINGA, J.:Confrontin# the Court in this petition is a novel $uestion, %ith constitutional overtones, involvin# the validit& of the polic& of a phar'aceutical co'pan& prohibitin# its e'plo&ees fro' 'arr&in# e'plo&ees of an& co'petitor co'pan&."his is a Petition for Review on Certiorari assailin# the Decision( dated Ma& (), *++, and the Resolution dated March *-, *++. of the Court of /ppeals in C/01.R. SP No. -*.,..*Petitioner Pedro /. "ecson 2"ecson3 %as hired b& respondent 1la4o 5ellco'e Philippines, Inc. 21la4o3 as 'edical representative on October *., ())6, after "ecson had under#one trainin# and orientation."hereafter, "ecson si#ned a contract of e'plo&'ent %hich stipulates, a'on# others, that he a#rees to stud& and abide b& e4istin# co'pan& rules7 to disclose to 'ana#e'ent an& e4istin# or future relationship b& consan#uinit& or affinit& %ith co0e'plo&ees or e'plo&ees of co'petin# dru# co'panies and should 'ana#e'ent find that such relationship poses a possible conflict of interest, to resi#n fro' the co'pan&."he E'plo&ee Code of Conduct of 1la4o si'ilarl& provides that an e'plo&ee is e4pected to infor' 'ana#e'ent of an& e4istin# or future relationship b& consan#uinit& or affinit& %ith co0e'plo&ees or e'plo&ees of co'petin# dru# co'panies. If 'ana#e'ent perceives a conflict of interest or a potential conflict bet%een such relationship and the e'plo&ee8s e'plo&'ent %ith the co'pan&, the 'ana#e'ent and the e'plo&ee %ill e4plore the possibilit& of a 9transfer to another depart'ent in a non0counterchec:in# position9 or preparation for e'plo&'ent outside the co'pan& after si4 'onths."ecson %as initiall& assi#ned to 'ar:et 1la4o8s products in the Ca'arines Sur0Ca'arines Norte sales area.Subse$uentl&, "ecson entered into a ro'antic relationship %ith ;etts&, an e'plo&ee of /stra Phar'aceuticals,2/stra3, a co'petitor of 1la4o. ;etts& %as /stra8s ;ranch Coordinator in /lba&. Shesupervised the district 'ana#ers and 'edical representatives of her co'pan& and prepared 'ar:etin# strate#ies for /stra in that area.Even before the& #ot 'arried, "ecson received several re'inders fro' his District Mana#er re#ardin# the conflict of interest %hich his relationship %ith ;etts& 'i#ht en#ender. Still, love prevailed, and "ecson 'arried ;etts& in Septe'ber ())obs, althou#h the& told hi' that the& %anted to retain hi' as 'uch as possible because he %as perfor'in# his >ob %ell."ecson re$uested for ti'e to co'pl& %ith the co'pan& polic& a#ainst enterin# into a relationship %ithan e'plo&ee of a co'petitor co'pan&. ?e e4plained that /stra, ;etts&8s e'plo&er, %as plannin# to 'er#e %ith @eneca, another dru# co'pan&7 and ;etts& %as plannin# to avail of the redundanc& pac:a#e to be offered b& /stra. 5ith ;etts&8s separation fro' her co'pan&, the potential conflict of interest %ould be eli'inated. /t the sa'e ti'e, the& %ould be able to avail of the attractive redundanc& pac:a#e fro' /stra.In /u#ust ())), "ecson a#ain re$uested for 'ore ti'e resolve the proble'. In Septe'ber ())), "ecson applied for a transfer in 1la4o8s 'il: division, thin:in# that since /stra did not have a 'il: division, the potential conflict of interest %ould be eli'inated. ?is application %as denied in vie% of 1la4o8s 9least0'ove'ent0possible9 polic&.In Nove'ber ())), 1la4o transferred "ecson to the ;utuan Cit&0Suri#ao Cit&0/#usan del Sur sales area. "ecson as:ed 1la4o to reconsider its decision, but his re$uest %as denied."ecson sou#ht 1la4o8s reconsideration re#ardin# his transfer and brou#ht the 'atter to 1la4o8s 1rievance Co''ittee. 1la4o, ho%ever, re'ained fir' in its decision and #ave "escon until Aebruar& B, *+++ to co'pl& %ith the transfer order. "ecson defied the transfer order and continued actin# as 'edical representative in the Ca'arines Sur0Ca'arines Norte sales area.Durin# the pendenc& of the #rievance proceedin#s, "ecson %as paid his salar&, but %as not issued sa'ples of products %hich %ere co'petin# %ith si'ilar products 'anufactured b& /stra. ?e %as also not included in product conferences re#ardin# such products.;ecause the parties failed to resolve the issue at the #rievance 'achiner& level, the& sub'itted the 'atter for voluntar& arbitration. 1la4o offered "ecson a separation pa& of one0half 2C3 'onth pa& for ever& &ear of service, or a total of P6+,+++.++ but he declined the offer. On Nove'ber (6, *+++, the National Conciliation and Mediation ;oard 2NCM;3 rendered its Decision declarin# as valid 1la4o8s polic& on relationships bet%een its e'plo&ees and persons e'plo&ed %ith co'petitor co'panies, and affir'in# 1la4o8s ri#ht to transfer "ecson to another sales territor&./##rieved, "ecson filed a Petition for Review %ith the Court of /ppeals assailin# the NCM; Decision.On Ma& (), *++,, the Court of /ppeals pro'ul#ated its Decision den&in# the Petition for Review on the #round that the NCM; did not err in renderin# its Decision. "he appellate court held that 1la4o8s polic& prohibitin# its e'plo&ees fro' havin# personal relationships %ith e'plo&ees of co'petitor co'panies is a valid e4ercise of its 'ana#e'ent prero#atives.."ecson filed a Motion for Reconsideration of the appellate court8s Decision, but the 'otion %as denied b& the appellate court in its Resolution dated March *-, *++..6Petitioners filed the instant petition, ar#uin# therein that 2i3 the Court of /ppeals erred in affir'in# theNCM;8s findin# that the 1la4o8s polic& prohibitin# its e'plo&ees fro' 'arr&in# an e'plo&ee of a co'petitor co'pan& is valid7 and 2ii3 the Court of /ppeals also erred in not findin# that "ecson %as constructivel& dis'issed %hen he %as transferred to a ne% sales territor&, and deprived of the opportunit& to attend products se'inars and trainin# sessions.-Petitioners contend that 1la4o8s polic& a#ainst e'plo&ees 'arr&in# e'plo&ees of co'petitor co'panies violates the e$ual protection clause of the Constitution because it creates invalid distinctions a'on# e'plo&ees on account onl& of 'arria#e. "he& clai' that the polic& restricts the e'plo&ees8 ri#ht to 'arr&.B"he& also ar#ue that "ecson %as constructivel& dis'issed as sho%n b& the follo%in# circu'stancesD 2(3 he %as transferred fro' the Ca'arines Sur0Ca'arines Norte sales area to the ;utuan0Suri#ao0/#usan sales area, 2*3 he suffered a di'inution in pa&, 2,3 he %as e4cluded fro' attendin# se'inarsand trainin# sessions for 'edical representatives, and 2.3 he %as prohibited fro' pro'otin# respondent8s products %hich %ere co'petin# %ith /stra8s products.obs 'ale and fe'ale applicants or e'plo&ees %ho are 'arried to a co'petitor. Conse$uentl&, the court ruled than an e'plo&er that dischar#ed an e'plo&ee %ho %as 'arried to an e'plo&ee of an active co'petitor did not violate "itle VII of the Civil Ri#hts /ct of ()-..*,"he Court pointed out that the polic& %as applied to 'en and %o'en e$uall&, and noted that the e'plo&er8s business %as hi#hl& co'petitive and that #ainin# inside infor'ation %ould constitute a co'petitive advanta#e."he challen#ed co'pan& polic& does not violate the e$ual protection clause of the Constitution as petitioners erroneousl& su##est. It is a settled principle that the co''ands of the e$ual protection clause are addressed onl& to the state or those actin# under color of its authorit&.*. Corollaril&, it has been held in a lon# arra& of !.S. Supre'e Court decisions that the e$ual protection clause erects noshield a#ainst 'erel& private conduct, ho%ever, discri'inator& or %ron#ful.*6 "he onl& e4ception occurs %hen the state*) in an& of its 'anifestations or actions has been found to have beco'e ent%ined or involved in the %ron#ful private conduct.*B Obviousl&, ho%ever, the e4ception is not present in this case. Si#nificantl&, the co'pan& actuall& enforced the polic& after repeated re$uests to the e'plo&ee to co'pl& %ith the polic&. Indeed, the application of the polic& %as 'ade in an i'partial and even0handed 'anner, %ith due re#ard for the lot of the e'plo&ee.In an& event, fro' the %ordin#s of the contractual provision and the polic& in its e'plo&ee handboo:,it is clear that 1la4o does not i'pose an absolute prohibition a#ainst relationships bet%een its e'plo&ees and those of co'petitor co'panies. Its e'plo&ees are free to cultivate relationships %ith and 'arr& persons of their o%n choosin#. 5hat the co'pan& 'erel& see:s to avoid is a conflict of interest bet%een the e'plo&ee and the co'pan& that 'a& arise out of such relationships. /s succinctl& e4plained b& the appellate court, thusD"he polic& bein# $uestioned is not a polic& a#ainst 'arria#e. /n e'plo&ee of the co'pan& re'ains free to 'arr& an&one of his or her choosin#. "he polic& is not ai'ed at restrictin# a personal prero#ative that belon#s onl& to the individual. ?o%ever, an e'plo&ee8s personal decision does not detract the e'plo&er fro' e4ercisin# 'ana#e'ent prero#atives to ensure 'a4i'u' profit and business success. . .*