Labor Law 2011

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Philippine Supreme Court Decisions on Labor Law

1. Labor Law (2011)

JANUARY

DOCTRINE CASE / CASE CONTENTApprenticeshipagreement; validity.

Atlanta Industries, Inc. and/or Robert Chan vs. Aprilito R. Sebolino, e

al., G.R. No. 187320, January 26, 2011.

The apprenticeship agreements did not indicate the trade or occupationin which the apprentice would be trained; neither was the apprenticeshipprogram approved by the Technical Education and Skills DevelopmenAuthority (TESDA). These were defective as they were executed inviolation of the law and the rules. Moreover, with the expiration of thfirst agreement and the retention of the employees, the employer, to al

intents and purposes, recognized the completion of their training andtheir acquisition of a regular employee status. To foist upon them thesecond apprenticeship agreement for a second skill which was not evenmentioned in the agreement itself, is a violation of the Labor Codes

implementing rules and is an act manifestly unfair to the employees.

Complaint;

reinstatement.

Prince Transport, Inc. and Mr. Renato Claros vs. Diosdado Garcia, e

al., G.R. No. 167291, January 12, 2011.

Petitioners question the order to reinstate respondents to their formepositions, considering that the issue of reinstatement was never broughup before the Court of Appeals and respondents never questioned theaward of separation pay to them. Section 2 (c), Rule 7 of the Rules oCourt provides that a pleading shall specify the relief sought, but may adda general prayer for such further or other reliefs as may be deemed jusand equitable. Under this rule, a court can grant the relief warranted bythe allegation and the evidence even if it is not specifically sought by the

injured party; the inclusion of a general prayer may justify the grant of a

remedy different from or in addition to the specific remedy sought, if thefacts alleged in the complaint and the evidence introduced so warrantThe prayer in the complaint for other reliefs equitable and just in thepremises justifies the grant of a relief not otherwise specifically prayed

for. Therefore, the court may grant relief warranted by the allegations andthe proof even if no such relief is prayed for. In the instant case, asidefrom their specific prayer for reinstatement, respondents, in theiseparate complaints, prayed for such reliefs which are deemed just andequitable.

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Collection of accruedwages; two-fold test.

Social Security System vs. Efren Capada, et al., G.R. No. 168501

January 31, 2011.

After the Labor Arbiters decision is reversed by a highertribunal, the employee may be barred from collecting the accrued wages

if it is shown that the delay in enforcing the reinstatement pendingappeal was without fault on the part of the employer. The two-foldtest in determining whether an employee is barred from recovering hiaccrued wages requires that (1) there must be actual delay or that theorder of reinstatement pending appeal was not executed prior to itsreversal; and (2) the delay must not be due to the employers unjustifiedact or omission. If the delay is due to the employers unjustified refusal

the employer may still be required to pay the salaries notwithstandingthe reversal of the Labor Arbiters Decision.

Disciplinary

measures;managementprerogative.

Primo E. Caong, Jr., et al. vs. Avelino Regualos, G.R. No. 179428

January 26, 2011.

The policy of suspending drivers pending payment of arrears in theiboundary obligations is reasonable. It is acknowledged that an employehas free rein and enjoys a wide latitude of discretion to regulate alaspects of employment, including the prerogative to instill discipline onhis employees and to impose penalties, including dismissal, if warrantedupon erring employees. This is a management prerogative. Indeed, themanner in which management conducts its own affairs to achieve itpurpose is within the managements discretion. The only limitation on th

exercise of management prerogative is that the policies, rules, and

regulations on work-related activities of the employees must always bfair and reasonable, and the corresponding penalties, when prescribedcommensurate to the offense involved and to the degree of the infraction

Dismissal;constructivedismissal.

The University of the Immaculate Conception, et al. vs. NLRC, et al., G.R

No. 181146, January 26, 2011.

Respondent was suspended for one year after being charged with andfound liable for AWOL. After serving her suspension, respondent wasallowed to return to work. Respondent cannot be considered to have beenconstructively dismissed by the petitioner during her period osuspension. Constructive dismissal occurs when there is cessation owork because continued employment is rendered impossibleunreasonable, or unlikely as when there is a demotion in rank odiminution in pay or when a clear discrimination, insensibility, or disdainby an employer becomes unbearable to the employee leaving the lattewith no other option but to quit. In this case, there was no cessation oemployment relations between the parties. It is unrefuted tha

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respondent promptly resumed teaching at the university right after theexpiration of the suspension period. In other words, respondent nevequit. Hence, she cannot claim to have been left with no choice but to quita crucial element in a finding of constructive dismissal.

Dismissal; dueprocess.

Robinsons Galleria/Robinsons Supermarket Corp. and/or Jess Manuevs. Irene R. Ranchez, G.R. No. 177937, January 19, 2011.

Respondent employee reported to the petitioner employer the loss ocash which she placed inside the company locker. Immediately, petitioneordered that she be strip-searched by the company guards. However, thsearch on her and her personal belongings yielded nothing. The petitionealso reported the matter to the police and requested the ProsecutorsOffice for an inquest. Respondent was constrained to spend two weeks in

jail for failure to immediately post bail. The Court ruled that petitionersfailed to accord respondent substantive and procedural due process

Article 277(b) of the Labor Code mandates that subject to theconstitutional right of workers to security of tenure and their right to beprotected against dismissal, except for just and authorized cause andwithout prejudice to the requirement of notice under Article 283 of thesame Code, the employer shall furnish the worker, whose employment issought to be terminated, a written notice containing a statement of thecauses of termination, and shall afford the latter ample opportunity to beheard and to defend himself with the assistance of a representative if heso desires, in accordance with company rules and regulations pursuant tothe guidelines set by the Department of Labor and Employment. The dueprocess requirements under the Labor Code are mandatory and may no

be supplanted by police investigation or court proceedings. The criminaaspect of the case is considered independent of the administrative aspectThus, employers should not rely solely on the findings of the ProsecutorOffice. They are mandated to conduct their own separate investigation

and to accord the employee every opportunity to defend himself.

Dismissal; neglect ofduty.

Hospital Management Services Medical Center Manila vs. Hospita

Management Services, Inc. Medical Center Manila EmployeeAssociation-AFW., G.R. No. 176287, January 31, 2011.

Neglect of duty, to be a ground for dismissal, must be both gross andhabitual. Gross negligence connotes want of care in the performance oones duties. Habitual neglect implies repeated failure to perform one

duties for a period of time, depending upon the circumstances. A single oisolated act of negligence does not constitute a just cause for the dismissaof the employee.

Dismissal; negligence Hospital Management Services Medical Center Manila vs. Hospita

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in patientmanagement.

Management Services, Inc. Medical Center Manila EmployeeAssociation-AFW., G.R. No. 176287, January 31, 2011.

Negligence is defined as the failure to exercise the standard of care that areasonably prudent person would have exercised in a similar situation

The Court emphasizes that the nature of the business of a hospitarequires a higher degree of caution and exacting standard of diligence inpatient management and health care as what is involved are lives opatients who seek urgent medical assistance. An act or omission that fallsshort of the required degree of care and diligence amounts to seriousmisconduct which constitutes a sufficient ground for dismissal.

Employer-employeerelationship; jeepneydriver.

Primo E. Caong, Jr., et al. vs. Avelino Regualos, G.R. No. 179428,

January 26, 2011.

It is already settled that the relationship between jeepneyowners/operators and jeepney drivers under the boundary system is that

of employer-employee and not of lessor-lessee. The fact that the driversdo not receive fixed wages but only get the amount in excess of the so-called boundary that they pay to the owner/operator is not sufficient to

negate the relationship between them as employer and employee.

Employer-employeerelationship; primaryelement.

Gregorio V. Tongko vs. The Manufacturers Life Insurance Co. (Phils.),

Inc. and Renato A. Vergel de Dios, G.R. No. 167622, January 25, 2011

Control over the performance of the task of one providing service bothwith respect to the means and manner, and the results of the service isthe primary element in determining whether an employment relationship

exists. Petitioner asserts that his employer Manulifes control overhimwas demonstrated (1) when it set the objectives and sales targetsregarding production, recruitment and training programs; and (2) whenit prescribed the Code of Conduct for Agents and the Manulife FinancialCode of Conduct to govern his activities. However, the court ruled that allthese appear to speak of control by the insurance company over itsagents. There are built-in elements of control specific to an insuranceagency, which do not amount to the elements of control that characterizean employment relationship governed by the Labor Code. They are,however, controls aimed only at specific results in undertaking an

insurance agency, and are, in fact, parameters set by law in defining an

insurance agency and the attendant duties and responsibilities aninsurance agent must observe and undertake. They do not reach the levelof control into the means and manner of doing an assigned task thatinvariably characterizes an employment relationship as defined by laborlaw. To reiterate, guidelines indicative of labor law control do notmerely relate to the mutually desirable result intended by the contractualrelationship; they must have the nature of dictating the means and

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methods to be employed in attaining the result. Petitioner is an insuranceagent not an employee.

Employer-employeerelationship;

probationaryemployment.

Robinsons Galleria/Robinsons Supermarket Corp. and/or Jess Manue

vs. Irene R. Ranchez, G.R. No. 177937, January 19, 2011.

A probationary employee, like a regular employee, enjoys security otenure. However, in cases of probationary employment, aside from just orauthorized causes of termination, an additional ground is provided underArticle 281 of the Labor Code, i.e., the probationary employee may also beterminated for failure to qualify as a regular employee in accordance withreasonable standards made known by the employer to the employee athe time of the engagement. Thus, the services of an employee who habeen engaged on probationary basis may be terminated for any of thefollowing: (1) a just or (2) an authorized cause; and (3) when he fails toqualify as a regular employee in accordance with reasonable standards

prescribed by the employer.

Employer-employeerelationship; regularemployment.


al., G.R. No. 187320, January 26, 2011.

The respondent employees were already rendering service to thecompany when they were made to undergo apprenticeship. Therespondent were regular employees because they occupied positionsuch as machine operator, scaleman and extruder operator tasks thaare usually necessary and desirable in petitioner employers usua

business or trade as manufacturer of plastic building materials. These

tasks and their nature characterized the respondents as regulaemployees under Article 280 of the Labor Code. Thus, when they werdismissed without just or authorized cause, without notice, and withouthe opportunity to be heard, their dismissal was illegal under the law

Illegal dismissal;strained relations.

Robinsons Galleria/Robinsons Supermarket Corp. and/or Jess Manue

vs. Irene R. Ranchez, G.R. No. 177937, January 19, 2011.

Article 279 of the Labor Code provides that an employee who is unjustlydismissed from work shall be entitled to reinstatement without loss oseniority rights and other privileges, to full backwages, inclusive oallowances, and to other benefits or their monetary equivalent computed

from the time his compensation was withheld from him up to the time ohis actual reinstatement. However, due to the strained relations of theparties, the payment of separation pay has been considered an acceptablealternative to reinstatement, when the latter option is no longer desirablor viable. On the one hand, such payment liberates the employee fromwhat could be a highly oppressive work environment. On the other, the

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payment releases the employer from the grossly unpalatable obligation omaintaining in its employ a worker it could no longer trust. Thus, as anillegally or constructively dismissed employee, respondent is entitled to(1) either reinstatement, if viable, or separation pay, if reinstatement is nolonger viable; and (2) backwages. These two reliefs are separate and

distinct from each other and are awarded conjunctively.

Illegal recruitment;elements.

People of the Philippines vs. Teresita Tessie Laogo, G.R. No. 176264January 10, 2011.

Recruitment and placement refers to the act of canvassing, enlisting,contracting, transporting, utilizing, hiring or procuring workers, andincludes referrals, contract services, promising or advertising foemployment, locally or abroad, whether for profit or not. When a person

or entity, in any manner, offers or promises for a fee employment to twoor more persons, that person or entity shall be deemed engaged in

recruitment and placement. Article 38(a) of the Labor Code, as amendedspecifies that recruitment activities undertaken by non-licensees or nonholders of authority are deemed illegal and punishable by law. And whenthe illegal recruitment is committed against three or more personsindividually or as a group, then it is deemed committed in large scale andcarries with it stiffer penalties as the same is deemed a form of economicsabotage. But to prove illegal recruitment, it must be shown that theaccused, without being duly authorized by law, gave complainants thedistinct impression that he had the power or ability to send them abroadfor work, such that the latter were convinced to part with their money inorder to be employed. It is important that there must at least be a promis

or offer of an employment from the person posing as a recruiter, whetherlocally or abroad.

Illegal dismissal;execution of waiverand quitclaim.

Bernadeth Londonio and Joan Corcoro vs. Bio Research, Inc. and

Wilson Y. Ang, G.R. No. 191459, January 17, 2011.

An employees execution of a final settlement and receipt of amountagreed upon does not foreclose his right to pursue a claim for illegadismissal. Thus, an employee illegally retrenched is entitled toreinstatement without loss of seniority rights and privileges, as well as topayment of full backwages from the time of her separation until actuareinstatement, less the amount which he/she received as retrenchmenpay.

Jurisdiction; laborarbiter.

Renato Real vs. Sangu Philippines, Inc. et al., G.R. No. 168757. January

19, 2011.

Petitioner was removed from his position as a manager through a Board

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Resolution. Petitioner filed a complaint for illegal dismissal before the

labor arbiter. Respondents claimed that petitioner is both a stockholdeand a corporate officer of respondent corporation, hence, his action

against respondents is an intra-corporate controversy over which thLabor Arbiter has no jurisdiction. The Court ruled that this is not an intra

corporate controversy but a labor case cognizable by the labor arbiter. Todetermine whether a case involves an intra-corporate controversy that ito be heard and decided by the branches of the RTC specificallydesignated by the Court to try and decide such cases, two tests must bapplied: (a) the status or relationship test, and (2) the nature of thecontroversy test. The first test requires that the controversy arise out o

intra-corporate or partnership relations among the stockholdersmembers or associates of the corporation, partnership or association,between any or all of them and the corporation, partnership orassociation of which they are stockholders, members or associatesbetween such corporation, partnership, or association and the public o

between such corporation, partnership, or association and the Stateinsofar as it concerns its franchise, license or permit to operate. Thesecond test requires that the dispute among the parties be intrinsicallyconnected with the regulation of the corporation. The Court in this caseheld that petitioner is not a corporate officer because he was not validlyappointed by the Board, thus, failing the relationship test, and that this isa case of employment termination which is a labor controversy and notan intra-corporate dispute, thus failing the nature of the controversy test.

Jurisdiction; labordispute.

The University of the Immaculate Conception, et al. vs. NLRC, et al., G.R

No. 181146, January 26, 2011.

Article 217 of the Labor Code states that unfair labor practices andtermination disputes fall within the original and exclusive jurisdiction othe Labor Arbiter. As an exception, under Article 262 the VoluntaryArbitrator, upon agreement of the parties, shall also hear and decide alother labor disputes including unfair labor practices and bargainingdeadlocks. For the exception to apply, there must be agreement betweenthe parties clearly conferring jurisdiction to the voluntary arbitrator. Suchagreement may be stipulated in a collective bargaining agreementHowever, in the absence of a collective bargaining agreement, it is enoughthat there is evidence on record showing the parties have agreed to resorto voluntary arbitration.

NLRC; factualfindings.

Prince Transport, Inc. and Mr. Renato Claros vs. Diosdado Garcia, e

al., G.R. No. 167291, January 12, 2011.

Factual findings of labor officials, who are deemed to have acquired

expertise in matters within their jurisdiction, are generally accorded no

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only respect but even finality by the courts when supported bysubstantial evidence, i.e., the amount of relevant evidence which areasonable mind might accept as adequate to justify a conclusion. Buthese findings are not infallible. When there is a showing that they werearrived at arbitrarily or in disregard of the evidence on record, they may

be examined by the courts. The CA can grant the petition for certiorari if ifinds that the NLRC, in itsassailed decision or resolution, made a factuafinding not supported by substantial evidence. Thus, it is within thjurisdiction of the CA to review the findings of the NLRC.

Petition; certificate of

non-forum shopping.Prince Transport, Inc. and Mr. Renato Claros vs. Diosdado Garcia, e

al., G.R. No. 167291, January 12, 2011.

While the general rule is that the certificate of non-forum shopping musbe signed by all the plaintiffs in a case and the signature of only one othem is insufficient, the Court has stressed that the rules on forum

shopping, which were designed to promote and facilitate the orderlyadministration of justice, should not be interpreted with such absoluteliteralness as to subvert its own ultimate and legitimate objective. Striccompliance with the provision regarding the certificate of non-forumshopping underscores its mandatory nature in that the certificatiocannot be altogether dispensed with or its requirements completelydisregarded. It does not, however, prohibit substantial compliancetherewith under justifiable circumstances, considering especially thaalthough it is obligatory, it is not jurisdictional. In a number of cases, theCourt has consistently held that when all the petitioners share a commoninterest and invoke a common cause of action or defense, the signature o

only one of them in the certification against forum shopping substantiallycomplies with the rules.

Petition; failure toattach documents.


al., G.R. No. 187320, January 26, 2011.

The respondent workers sought that the petition be dismissed outrighfor the petitioners failure to attach to the petition a copy of the

Production and Work Schedule and a copy of the compromise agreemenallegedly entered into material portions of the record that shouldaccompany and support the petition, pursuant to Section 4, Rule 45 of theRules of Court. In Mariners Polytechnic Colleges Foundation, Inc. v. ArturoJ. Garchitorena the Court held that the phrase of thepleadings and othematerial portions of the record xxx as would support the allegation of thepetition clearly contemplates the exercise of discretion on the part of thepetitioner in the selection of documents that are deemed to be relevant tothe petition. The crucial issue to consider then is whether or not thedocuments accompanying the petition sufficiently supported the

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allegations therein. The failure toattach copy of the subject documents inot fatal as the challenged CA decision clearly summarized thelabor tribunals rulings.

Petition; verification. Prince Transport, Inc. and Mr. Renato Claros vs. Diosdado Garcia, et

al., G.R. No. 167291, January 12, 2011.

The verification requirement is deemed substantially complied with whensome of the parties who undoubtedly have sufficient knowledge and

belief to swear to the truth of the allegations in the petition had signed thesame. Such verification is deemed a sufficient assurance that the matter

alleged in the petition have been made in good faith or are true andcorrect, and not merely speculative. In any case, the settled rule is that apleading which is required by the Rules of Court to be verified, maybe given due course even without a verification if the circumstances

warrant the suspension of the rules in the interest of justice. Indeed, the

absence of a verification is not jurisdictional, but only a formal defectwhich does not of itself justify a court in refusing to allow and act on acase. Hence, the failure of some of the respondents to sign the verificationattached to their Memorandum of Appeal filed with the NLRC is not fatato their cause of action.

Regional director;review of decision.

The Heritage Hotel Manila, acting through its owner, Grand Plaza

Hotel, Corp. vs. National Union of Workers in the Hotel, Restaurant and

Allied Industries-Heritage Hotel Manila Supervisors Chapte

(NUWHRAIN-HHMSC), G.R. No. 178296, January 12, 2011.

Petitioner appealed an adverse decision to the BLR. BLR Directoinhibited himself from the case because he had been a former counsel orespondent. In view of the inhibition, DOLE Secretary took cognizance othe appeal. Jurisdiction to review the decision of the Regional Director liewith the BLR. Once jurisdiction is acquired by the court, it remains with iuntil the full termination of the case. Thus, jurisdiction remained with thBLR despite the BLR Directors inhibition. When the DOLE Secretaryresolved the appeal, she merely stepped into the shoes of the BLRDirector and performed a function that the latter could not himselperform. She did so pursuant to her power of supervision and controover the BLR.

Union registration;cancellation.

The Heritage Hotel Manila, acting through its owner, Grand Plaza

Hotel, Corp. vs. National Union of Workers in the Hotel, Restaurant and

Allied Industries-Heritage Hotel Manila Supervisors Chapte

(NUWHRAIN-HHMSC), G.R. No. 178296, January 12, 2011.

The amendment introduced by RA 9481 sought to strengthen the

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workers right to self-organization and enhance the Philippinescompliance with its international obligations as embodied in thInternational Labour Organization (ILO) Convention No. 87, pertainingto the non-dissolution of workers organizations by administrativeauthority. ILO Convention No. 87 provides that workers and employers

organizations shall not be liable to be dissolved or suspended byadministrative authority. The ILO has expressed the opinion that the

cancellation of union registration by the registrar of labor unions, whichin our case is the BLR, is tantamount to dissolution of the organization byadministrative authority when such measure would give rise to the loss olegal personality of the union or loss of advantages necessary for it tocarry out its activities, which is true in our jurisdiction. Although the ILOhas allowed such measure to be taken, provided that judicial safeguardsare in place, i.e., the right to appeal to a judicial body, it has nonethelessreminded its members that dissolution of a union, and cancellation oregistration for that matter, involve serious consequences fo

occupational representation. It has, therefore, deemed it preferable isuch actions were to be taken only as a last resort and after exhaustinother possibilities with less serious effects on the organization. It isundisputed that appellee failed to submit its annual financial reports andlist of individual members in accordance with Article 239 of the LaboCode. However, the existence of this ground should not necessarily lead tothe cancellation of union registration. At any rate, the Court in this castook note of the fact that on 19 May 2000, appellee had submitted itfinancial statement for the years 1996-1999. With this submissionappellee has substantially complied with its duty to submit its financiareport for the said period.

Wages; paymentpendingreinstatement.

Social Security System vs. Efren Capada, et al., G.R. No. 168501

January 31, 2011.

Employees are entitled to their accrued salaries during the periodbetween the Labor Arbiters order of reinstatement pending appeal and

the resolution of the National Labor Relations Commission (NLRCoverturning that of the Labor Arbiter. Otherwise stated, even if the ordeof reinstatement of the Labor Arbiter is reversed on appeal, the employeris still obliged to reinstate and pay the wages of the employee during theperiod of appeal until reversal by a higher court or tribunal. On the othehand, if the employee has been reinstated during the appeal period andsuch reinstatement order is reversed with finality, the employee is no

required to reimburse whatever salary he received for he is entitled tosuch, more so if he actually rendered services during the period.

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FEBRUARY

Abandonment;elements.

E.G. & I. Construction Corporation and Edsel Galeos v. Ananias P. Sato

et al., G.R. No. 182070, February 16, 2011

Respondents filed an illegal dismissal case against the petitioner

corporation. For its defense, petitioner-corporation alleged that therespondents abandoned their work and were not dismissed, and that isent letters advising respondents to report for work, but they refusedThe Court held that for abandonment to exist, it is essential (a) that theemployee must have failed to report for work or must have been absentwithout valid or justifiable reason; and (b) that there must have been aclear intention to sever the employer-employee relationship manifestedby some overt acts. The employer has the burden of proof to show theemployees deliberate and unjustified refusal to resume his employmen

without any intention of returning. Mere absence is not sufficient. Theremust be an unequivocal intent on the part of the employee to discontinue

his employment. Based on the evidence presented, the reason whyrespondents failed to report for work was because petitioner-corporationbarred them from entering its construction sites. It is a settled rule thafailure to report for work after a notice to return to work has been serveddoes not necessarily constitute abandonment. The intent to discontinuethe employment must be shown by clear proof that it was deliberate andunjustified. Petitioner-corporation failed to show overt acts committed byrespondents from which it may be deduced that they had no moreintention to work. Respondents filing of the case for illegal dismissa

barely four (4) days from their alleged abandonment is totallyinconsistent with the known concept of what constitutes abandonment.

Certification election;

petition forcancellation of unionregistration.

Legend International Resorts Limited v. Kilusang Manggagawa ng

Legenda, G.R. No. 169754, February 23, 2011

Respondent union filed a petition for certification election. Petitionermoved to dismiss the petition for certification election alleging the

pendency of a petition for cancellation of the unions registration. The

DOLE Secretary ruled in favor of the legitimacy of the respondent as alabor organization and ordered the immediate conduct of a certification

election. Pending appeal in the Court of Appeals, the petition focancellation was granted and became final and executory. Petitioneargued that the cancellation of the unions certificate of registration

should retroact to the time of its issuance. Thus, it claimed that theunions petition for certification election and its demand to enter into

collective bargaining agreement with the petitioner should be dismisseddue to respondents lack of legal personality. The Court ruled that the

pendency of a petition for cancellation of union registration does nopreclude collective bargaining, and that an order to hold a certification

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election is proper despite the pendency of the petition for cancellation othe unions registration because at the time the respondent union filed it

petition, it still had the legal personality to perform such act absent anorder cancelling its registration.

Certiorari under Rule65; review of facts bythe Court of Appeals

Nelson A. Culili v. Eastern Telecommunications Philippines, Inc., et alG.R. No. 165381, February 9, 2011

While it is true that factual findings made by quasi-judicial andadministrative tribunals, if supported by substantial evidence, areaccorded great respect and even finality by the courts, this general ruleadmits of exceptions. When there is a showing that a palpable anddemonstrable mistake that needs rectification has been committed owhen the factual findings were arrived at arbitrarily or in disregard of theevidence on record, these findingsmay be examined by the courts. In thpresent case, the Court of Appeals found itself unable to completely

sustain the findings of the NLRC thus, it was compelled to review the factand evidence and not limit itself to the issue of grave abuse of discretion.

ConstructionIndustry; projectemployees.

Exodus International Construction Corporation, et al. v. Guillermo

Biscocho, et al., G.R. No. 166109, February 23, 2011

Petitioner is a duly licensed labor contractor engaged in painting houseand buildings. Respondents, former painters of the petitioner, filed an

illegal dismissal case against petitioner. Petitioner alleged that therespondents abandoned their job and were not dismissed by thepetitioner. The Labor Arbiter ruled that there was neither illegal dismissa

nor abandonment of job and that the respondents should be reinstatedbut without any backwages. On appeal, petitioner alleged that thereinstatement of respondents to their former positions, which were nolonger existing, is impossible, highly unfair and unjust. It further allegedthat the project they were working on at the time of their allegeddismissal was already completed. Having completed their tasks, theipositions automatically ceased to exist. Thus, there were no morepositions where they can be reinstated as painters. The Court ruled thathere are two types of employees in the construction industry. The first i

referred to as project employees or those employed in connection with aparticular construction project or phase thereof and such employment icoterminous with each project or phase of the project to which they areassigned. The second is known as non-project employees or thoseemployed without reference to any particular construction project ophase of a project. Respondents belonged to the second type and areclassified as regular employees of petitioner. It is clear from the records o

the case that when one project is completed, respondents werautomatically transferred to the next project awarded to petitioners

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There was no employment agreement given to respondents whichclearly spelled out the duration of their employment and the specifi

work to be performed and there is no proof that they were made aware othese terms and conditions of their employment at the time of hiringThus, it is now too late for petitioner to claim that respondents are projec

employees whose employment is coterminous with each project or phaseof the project to which they are assigned. Nonetheless, assuming tharespondents were initially hired as project employees, a project employeemay acquire the status of a regular employee when the following factorsconcur: (1) There is a continuous rehiring of project employees even aftecessation of a project; and (2) The tasks performed by the alleged projecemployee are vital, necessary and indispensable to the usual business ortrade of the employer. In this case, the evidence on record shows tharespondents were employed and assigned continuously to the variouprojects of petitioners. As painters, they performed activities which werenecessary and desirable in the usual business of petitioner, which wa

engaged in subcontracting jobs for painting of residential unitscondominium and commercial buildings. As regular employeesrespondents are entitled to be reinstated without loss of seniority rights.

ConstructiveDismissal; securityguards.

Nationwide Security and Allied Services, Inc. v. Ronald P. Valderama

G.R. No. 186614, February 23, 2011

Respondent was hired by petitioner, a security agency, as a securityguard. He was assigned at the Philippine Heart Center until his relief onJanuary 30, 2006. Respondent was not given any assignment thereafterThus, on August 2, 2006, he filed a complaint for constructive dismissa

and nonpayment of 13 month pay, with prayer for damages againspetitioner. To refute the claim, petitioner alleged that respondent was noconstructively or illegally dismissed, but had voluntarily resigned. TheCourt held that respondent was constructively dismissed. In cases theinvolving security guards, a relief and transfer order in itself does nosever employment relationship between a security guard and his agencyAn employee has the right to security of tenure, but this does not give hima vested right to his position as would deprive the company of itsprerogative to change his assignment or transfer him where his serviceas security guard, will be most beneficial to the client. Temporary offdetail or the period of time security guards are made to wait until they

are transferred or assigned to a new post or client does not constituteconstructive dismissal, so long as such status does not continue beyondsix months. The onus of proving that there is no post available to whichthe security guard can be assigned rests on the employer. In the instancase, the failure of petitioner to give respondent a work assignmenbeyond the reasonable six-month period makes it liable for constructivedismissal.

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Constructivedismissal; defense ofabandonment.


G.R. No. 186614, February 23, 2011

Respondent filed an illegal dismissal case against the petitioner

Petitioner alleged that respondent abandoned his job and was nodismissed. The Court held that respondent was illegally dismissed. Thejurisprudential rule on abandonment is constant. It is a matter ointention and cannot lightly be presumed from certain equivocal acts. Toconstitute abandonment, two elements must concur: (1) the failure toreport for work or absence without valid or justifiable reason; and (2) a

clear intent, manifested through overt acts, to sever the employeremployee relationship. In this case, petitioner failed to establish cleaevidence of respondents intention to abandon his employment.

Constructive

dismissal; defense ofresignation.


G.R. No. 186614, February 23, 2011

Respondent, a security guard, filed an illegal dismissal case against the

petitioner. To refute the claim, petitioner alleged that respondent was noconstructively or illegally dismissed, but had voluntarily resignedPetitioner alleged that respondents resignation is evident from hi

withdrawal of his cash and firearm bonds. Resignation is the voluntary ac

of an employee who is in a situation where one believes that personareasons cannot be sacrificed in favor of the exigency of the service, andone has no other choice but to dissociate oneself from employment. It is aformal pronouncement or relinquishment of an office. The intent to

relinquish must concur with the overt act of relinquishment. Thus, theacts of the employee before and after the alleged resignation must bconsidered in determining whether, he or she, in fact, intended to sevehis or her employment. Should the employer interpose the defense oresignation, it is incumbent upon the employer to prove that theemployee voluntarily resigned. On this point, the Court held thapetitioner failed to discharge its burden. Moreover, the filing of acomplaint belies petitioners claim that respondent voluntarilyresigned.

Execution ofJudgment; propertiescovered.

Paquito V. Ando v. Andresito Y. Campo, et al., G.R. No. 184007

February 16, 2011

Premier Allied and Contracting Services, Inc. (PACSI) and its Presidentthe petitioner, were held liable to pay the respondents separation pay andattorneys fees. To execute this judgment, the NLRC sheriff issued a Notice

of Sale of a property with a TCT in the name of the petitioner and his wifeThe Court ruled that the Notice of Sale is null and void. The power of theNLRC, or the courts, to execute its judgment extends only to propertie

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unquestionably belonging to the judgment debtor alone. A sherifftherefore, has no authority to attach the property of any person exceptthat of the judgment debtor. Likewise, there is no showing that the sherifever tried to execute on the properties of the corporation. The TCT of theproperty bears out that, indeed, it belongs to petitioner and his wife

Thus, even if we consider petitioner as an agent of the corporation andtherefore, not a stranger to the case such that the provision on thirdparty claims will not apply to him, the property was registered not only inthe name of petitioner but also of his wife. She stands to lose the propertysubject of execution without ever being a party to the case. This will betantamount to deprivation of property without due process.

Illegal dismissal;burden of proof.


et al., G.R. No. 182070, February 16, 2011

Respondents filed an illegal dismissal case against petitioner. Petitione

alleged that the respondents abandoned their work and were nevedismissed by the petitioner. NLRC ruled that the respondents were noillegally dismissed since they failed to present a written notice otermination. This was however reversed by the Court of Appeals. TheCourt held that a written notice of dismissal is not a pre-requisite for afinding of illegal dismissal. Petitioner failed to prove that respondent

were dismissed for a just or authorized cause. In an illegal dismissal casethe onus probandi rests on the employer to prove that the dismissal of anemployee is for a valid cause.

Illegal dismissal;

burden of proof.

Exodus International Construction Corporation, et al. v. Guillermo

Biscocho, et al., G.R. No. 166109, February 23, 2011

Respondents filed an illegal dismissal case against the petitioners

Petitioners, in their defense, alleged that the respondents abandonedtheir work and were not dismissed by the petitioners. Although In caseof illegal dismissal, the employer bears the burden of proof to prove thatthe termination was for a valid or authorized cause, the employee musfirst establish by substantial evidence the fact that he was dismissed. I

there is no dismissal, then there can be no question as to the legality orillegality thereof. In the present case, the Court held that there was noevidence that respondents were dismissed or that they were preventedfrom returning to their work. It was only respondents unsubstantiatedconclusion that they were dismissed. As a matter of fact, respondentcould not name the particular person who effected their dismissal andunder what particular circumstances. Absent any showing of an overt orpositive act proving that petitioners had dismissed respondents, thelatters claim of illegal dismissal cannot be sustained.

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Illegal dismissal; final

and executoryjudgment.

Filipinas Palmoil Processing, Inc. and Dennis T. Villareal v. Joel P.

Dejapa, represented by his Attorney-in-Fact Myrna Manzano, G.R. No.

167332, February 7, 2011

Respondent employee filed an illegal dismissal case against thepetitioner-company and Tom Madula, its operations manager. The casewas dismissed by the labor arbiter and the dismissal was affirmed by

NLRC. On August 29, 2002, the Court of Appeals reversed and set asidethe NLRC decision and resolution. The CA ordered the petitioner companyto pay respondent separation pay, moral and exemplary damages, andattorneys fees. The decision became final and executory on February 27,2004, and consequently a writ of execution was issued. Petitionercompany filed a motion to Quash a Writ of Execution. The Labor Arbitergranted the Motion and exonerated the petitioner company from payingbackwages and held that it was petitioner Madula who should be liable to

pay backwages. Respondent then filed before the CA a Very UrgentMotion for Clarification of Judgment. On December 10, 2004, CA granted

the Motion and held the petitioner company is solely liable for judgementaward. As a general rule, final and executory judgments are immutableand unalterable, except under these recognized exceptions, to wit: (a)clerical errors; (b) nunc pro tunc entries which cause no prejudice to anyparty; and (c) void judgments. The underlying reason for the rule is two-fold: (1) to avoid delay in the administration of justice and thus makeorderly the discharge of judicial business, and (2) to put judicialcontroversies to an end, at the risk of occasional errors, inasmuch ascontroversies cannot be allowed to drag on indefinitely and the rights and

obligations of every litigant must not hang in suspense for an indefiniteperiod of time. What the CA rendered on December 10, 2004 was a nuncpro tunc order clarifying the decretal portion of its August 29, 2002Decision. The object of a judgment nunc pro tunc is not the rendering of anew judgment and the ascertainment and determination of new rights,but is one placing in proper form on the record, the judgment that hadbeen previously rendered, to make it speak the truth, so as to make itshow what the judicial action really was. It is not to correct judicial errorssuch as to render a judgment anew in place of the one it rendered, nor tosupply non action by the court, however erroneous the judgment mayhave been.

Illegal dismissal;liability of corporateofficers.

Nelson A. Culili v. Eastern Telecommunications Philippines, Inc., et al

G.R. No. 165381, February 9, 2011

Petitioner filed a complaint against respondent company and its officer

for illegal dismissal, unfair labor practice, and money claims. Petitioneralleged that the officers should be held personally liable for the acts o

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company which were tainted with bad faith and arbitrariness. As ageneral rule, a corporate officer cannot be held liable for acts done in hiofficial capacity because a corporation, by legal fiction, has a personalityseparate and distinct from its officers, stockholders, and members. To

pierce this fictional veil, it must be shown that the corporate personality

was used to perpetuate fraud or an illegal act, or to evade an existingobligation, or to confuse a legitimate issue. In illegal dismissal casescorporate officers may be held solidarily liable with the corporation if the

termination was done with malice or bad faith. Moral damages arawarded only where the dismissal was attended by bad faith or fraud, oconstituted an act oppressive to labor, or was done in a manner contraryto morals, good customs or public policy. Exemplary damages may avail ifthe dismissal was effected in a wanton, oppressive or malevolent mannerIn the present case, the Court held that petitioner failed to prove that hisdismissal was orchestrated by the individual respondents and their actwere attended with bad faith or were done oppressively.

Illegal dismissal;redundancy.


G.R. No. 165381, February 9, 2011

Respondent-company, due to business troubles and losses, implementeda Right-Sizing Program which entailed a company-wide reorganizationinvolving the transfer, merger, absorption or abolition of certaindepartments of the company. As a result, respondent-companyterminated the services of petitioner on account of redundancy. Petitionefiled a complaint against respondent-company and its officers for illegadismissal, unfair labor practice, and money claims. The Court ruled tha

petitioner was validly dismissed. There is redundancy when the serviccapability of the workforce is greater than what is reasonably required tomeet the demands of the business enterprise. A position becomeredundant when it is rendered superfluous by any number of factorssuch as over-hiring of workers, decrease in volume of business, odropping a particular product line or service activity previouslymanufactured or undertaken by the enterprise. The Court has beenconsistent in holding that the determination of whether or not anemployees services are still needed or sustainable properly belongs to

the employer. Provided there is no violation of law or a showing that theemployer was prompted by an arbitrary or malicious act, the soundnessor wisdom of this exercise of business judgment is not subject to thediscretionary review of the Labor Arbiter and the NLRC. However, anemployer cannot simply declare that it has become overmanned anddismiss its employees without producing adequate proof to sustain itsclaim of redundancy. Among the requisites of a valid redundancy programare: (1) the good faith of the employer in abolishing the redundanposition; and (2) fair and reasonable criteria in ascertaining wha

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positions are to be declared redundant, such as but not limited topreferred status, efficiency, and seniority. The Court also held that the

following evidence may be proffered to substantiate redundancyadoption of a new staffing pattern, feasibility studies/ proposal on the

viability of the newly created positions, job description and the approva

by the management of the restructuring.

Labor Union;collateral attack onlegal personality.

Legend International Resorts Limited v. Kilusang Manggagawa ng

Legenda, G.R. No. 169754 , February 23, 2011

Petitioner moved to dismiss the petition for certification election filed by

respondent union by questioning the validity of the respondents unionregistration. The Court held that legitimacy of the legal personality orespondent cannot be collaterally attacked in a petition for certification

election proceeding but only through a separate action institutedparticularly for the purpose of assailing it. The Implementing Rule

stipulate that a labor organization shall be deemed registered and vestedwith legal personality on the date of issuance of its certificate o

registration. Once a certificate of registration is issued to a union, itslegapersonality cannot be subject to a collateral attack. It may be questionedonly in an independent petition for cancellation in accordance withSection 5 of Rule V, Book V of the Implementing Rules.

Money claims; burdenof proof.


et al., G.R. No. 182070 ,February 16, 2011

Respondents alleged that petitioner-corporation failed to pay them their

full compensation. The Labor Arbiter granted their monetary claims buthe NLRC reversed the award considering that the petitioner-corporationsubmitted copies of payrolls, which it annexed to its memorandum onappeal, showing full payment. The general rule is that the burden rests onthe employer to prove payment, rather than on the employee to provenon-payment. The reason for the rule is that the pertinent personnel filespayrolls, records, remittances, and other similar documents whichwill show that overtime, differentials, service incentive leave, and otheclaims of the worker have been paid are not in the possession of thworker but in the custody and absolute control of the employer. In thicase, the submission by petitioner-corporation of the time records andpayrolls only when the case was on appeal before the NLRC is contrary tothe elementary precepts of justice and fair play. Respondents were nogiven the opportunity to check the authenticity and correctness of theevidence submitted on appeal. Thus, the Supreme Court held that themonetary claims of respondents should be granted. It is a time-honoredprinciple that if doubts exist between the evidence presented by theemployer and the employee, the scales of justice must be tilted in favor o

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the latter. It is the rule in controversies between a laborer and his masterthat doubts reasonably arising from the evidence, or in the interpretationof agreements and writing, should be resolved in the formers favor.

National Labor

RelationsCommission;jurisdiction

Paquito V. Ando v. Andresito Y. Campo, et al., G.R. No. 184007

February 16, 2011

Respondents filed an illegal dismissal case against Premier Allied and

Contracting Services, Inc. (PACSI) and its President, the petitioner. PACSand the petitioner were held liable to pay the respondents separation payand attorneys fees. To execute this judgment, NLRC sheriff issued aNotice of Sale of a property with TCT in the name of the petitioner andhis wife. Petitioner filed an action for prohibition and damages with

prayer for the issuance of a temporary restraining order (TRO) before thRegional Trial Court (RTC). The Court ruled that the RTC lackjurisdiction to resolve the matter. The Court has long recognized tha

regular courts have no jurisdiction to hear and decide questions whicharise from and are incidental to the enforcement of decisions, orders, orawards rendered in labor cases by appropriate officers and tribunals o

the Department of Labor and Employment. To hold otherwise is tosanction splitting of jurisdiction which is obnoxious to the orderlyadministration of justice. The NLRC Manual on the Execution of Judgmentdeals specifically with third-party claims in cases brought before thabody. It defines a third-party claim as one where a person, not a party tothe case, asserts title to or right to the possession of the propertylevied upon. It also sets out the procedure for the filing of a third-partyclaim, to wit: such person shall make an affidavit of his title thereto o

right to the possession thereof, stating the grounds of such right or titleand shall file the same with the sheriff and copies thereof served upon thLabor Arbiter or proper officer issuing the writ and upon the prevailingparty. In the present case, there is no doubt that petitioners complaint i

a third-party claim within the cognizance of the NLRC. Petitioner mayindeed be considered a third party in relation to the property subject o

the execution since there is no question that the property belongs topetitioner and his wife, and not to the corporation. It can be said that theproperty belongs to the conjugal partnership, and not to petitioner aloneAt the very least, the Court can consider petitioners wife to be a third

party within the contemplation of the law.

Placement Fee; proofof excessivecollection.

Avelina F. Sagun v. Sunace International Management Services, Inc

G.R. No. 179242, February 23, 2011

Petitioner filed a complaint against respondent for collection of excess

placement fee defined in Article 34(a) of the Labor Code. Petitioner

presented as her evidence a promissory note reflecting excessive fees and

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testified as to the deductions made by her foreign employer. On the othe

hand, respondent presented an acknowledgment receipt reflectingcollection of an amount authorized by POEA. The Court held that thepieces of evidence presented by petitioner are not substantial enough toshow that the respondent collected from her more than the allowabl

placement fee. In proceedings before administrative and quasi-judiciaagencies, the quantum of evidence required to establish a fact isubstantial evidence, or that level of relevant evidence which a reasonablmind might accept as adequate to justify a conclusion. The Court gavmore credence to respondents evidence consisting of the

acknowledgment receipt showing the amount paid by petitioner andreceived by respondent. A receipt is a written and signedacknowledgment that money or goods have been delivered. Although areceipt is not conclusive evidence, an exhaustive review of the recordsof the case fails to disclose any other evidence sufficient and stronenough to overturn the acknowledgment embodied in respondent

receipt as to the amount it actually received from petitioner. Having failedto adduce sufficient rebuttal evidence, petitioner is bound by the content

of the receipt issued by respondent. The subject receipt remains as theprimary or best evidence. The promissory note presented by petitionecannot be considered as adequate evidence to show the excessiveplacement fee. It must be emphasized that a promissory note is a solemnacknowledgment of a debt and a formal commitment to repay it on thedate and under the conditions agreed upon by the borrower and thelender. A person who signs such an instrument is bound to honor it as alegitimate obligation duly assumed by him through the signature heaffixes thereto as a token of his good faith. The fact that respondent is no

a lending company does not preclude it from extending a loan topetitioner for her personal use. As for the deductions purportedly madeby petitioners foreign employer, the Court notedthat there is no singlepiece of document or receipt showing that deductions have in fact beenmade, or isthere any proof that these deductions from the salary formedpart of the subject placement fee. To be sure, mere general allegations opayment of excessive placement fees cannot be given merit as the chargeof illegal exaction is considered a grave offense which could cause thesuspension or cancellation of the agencys license. They should be proven

and substantiated by clear, credible, and competent evidence.

Procedural dueprocess; noticerequirements.


G.R. No. 165381, February 9, 2011

Petitioner was dismissed by respondent-company due to redundancyHowever, it failed to provide the Department of Labor and Employmenwith a written notice regarding petitioners termination. The notice o

termination was also not properly served on the petitioner. Further, a

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reading of the notice shows that respondent-company failed to properlyinform the petitioner of the grounds for his termination. There are twoaspects which characterize the concept of due process under the LaborCode: one is substantive whether the termination of employment wasbased on the provision of the Labor Code or in accordance with the

prevailing jurisprudence; the other is procedural the manner in whichthe dismissal was effected. There is a psychological effect or a stigmain immediately finding ones self laid off from work. This is why our labo

laws have provided for procedural due process. While employers have theright to terminate employees it can no longer sustain, our laws alsorecognize the employees right to be properly informed of the impendingtermination of his employment. Though the failure of respondentcompany to comply with the notice requirements under the Labor Codedid not affect the validity of the dismissal, petitioner is however entitledto nominal damages in addition to his separation pay.

Quitclaims; validity. Plastimer Industrial Corporation and Teo Kee Bin v. Natalia C. Gopo, eal., G.R. No. 183390, February 16, 2011

Respondents were terminated from employment due to retrenchmenimplemented by petitioner. Upon their dismissal, the respondents signedindividual Release Waiver and Quitclaim. The Court ruled that a waive

or quitclaim is a valid and binding agreement between the partiesprovided that it constitutes a credible and reasonable settlement, and thathe one accomplishing it has done so voluntarily and with a fulunderstanding of its import. In this case, the respondents weresufficiently apprised of their rights under the waivers and quitclaims tha

they signed. Each document contained the signatures of the unionpresident and its counsel, which proved that respondents were dulyassisted when they signed the waivers and quitclaims. Hence, the Courupheld the validity of thewaivers and quitclaims signed by therespondents in this case.

Retrenchment; noticerequirements.

Plastimer Industrial Corporation and Teo Kee Bin v. Natalia C. Gopo, e

al., G.R. No. 183390, February 16, 2011

Petitioner issued a Memorandum informing all its employees of thedecision of the companys Board of Directors to downsize and reorganizeits business operations due to the change of its corporate structurePetitioner served the individual notice of termination on itsmemployeeson May 14, 2004 or 30 days before the effective date of their terminationon 13 June 2004, while it submitted the notice of termination to theDepartment of Labor and Employment only on 26 May 2004, short of thone-month prior notice requirement under Article 283 of the Labor CodeThe Court held that petitioners failure to comply with the one-month

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notice to the DOLE is only a procedural infirmity and does not render the

retrenchment illegal. When the dismissal is for a just cause, the absence oproper notice will not nullify the dismissal or render it illegal orineffectual. Instead, the employer should indemnify the employee foviolation of his statutory rights.

Retrenchment; noticerequirements.

Plastimer Industrial Corporation and Teo Kee Bin v. Natalia C.

Gopo, et al., G.R. No. 183390, February 16, 2011

In 2004, the petitioner had to retrench and consequently terminate theemployment of the respondents. Respondents questioned the validity othe retrenchment, and alleged that though petitioners financia

statements in 2001 and 2002 reflected losses, it declared net income in2003. The Court ruled that the fact that there was a net income in 2003does mean that there was no valid reason for the retrenchment. Recordsshowed that the net income of P6,185,707.05 in 2003 was not enough to

allow petitioners to recover the loss of P52,904,297.88 which it sufferedin 2002. Article 283 of the Labor Code recognizes retrenchment toprevent losses as a right of the management to meet clear and continuingeconomic threats or during periods of economic recession to prevenlosses. There is no need for the employer to wait for substantial losses tomaterialize before exercising ultimate and drastic option to prevent suchlosses.

Unfair Labor Practice;right to self-organize.


G.R. No. 165381, February 9, 2011

Respondent-company implemented a company-wide reorganizationwhich resulted in the abolition of petitioners position. Petitioner alleged

that he was illegally dismissed and that respondent-company is guilty ounfair labor practice because his functions were outsourced to labor-onlycontractors. The Supreme Court held unfair labor practice refers to actsthat violate the workers right to organize. The prohibited acts are related

to the workers right to self-organization and to the observance of a CBA.Thus, an employer may be held liable for unfair labor practice only if ican be shown that his acts interfere with his employees right to self

organization. Since there is no showing that the respondent companyimplementation of the Right-Sizing Program was motivated by ill will, badfaith or malice, or that it was aimed at interfering with its employees

right to self-organization, there is no unfair labor practice to speak of inthis case.

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MARCH

Abandonment;elements.

Harpoon Marine Services, Inc., et al. v. Fernan H. Francisco, GR No

167751, March 2, 2011.

Respondent employee was dismissed by petitioners on the ground o

alleged habitual absenteeism and abandonment of work. Jurisprudenceprovides for two essential requirements for abandonment of work toexist: (1) the failure to report for work or absence without valid ojustifiable reason, and (2) clear intention to sever the employer-employerelationship manifested by some overt acts should both concur. Furtherthe employees deliberate and unjustified refusal to resume hi

employment without any intention of returning should be established andproven by the employer. The Court held that petitioners failed to provethat it was respondent employee who voluntarily refused to report backfor work by his defiance and refusal to accept the memoranda and the

notices of absences sent to him. Petitioners failed to present evidence tha

they sent these notices to respondent employees last known address fothe purpose of warning him that his continued failure to report would beconstrued as abandonment of work. Moreover, the fact that respondenemployee never prayed for reinstatement and has sought employment inanother company which is a competitor of petitioners cannot beconstrued as his overt acts of abandoning employment. Neither can thedelay of four months be taken as an indication that the respondenemployees filing of a complaint for illegal dismissal is a mere

afterthought. Records show that respondent employee attempted to gehis separation pay and alleged commissions from the company, but it waonly after his requests went unheeded that he resorted to judicia

recourse.

Corporate officer;

solidary liability.Harpoon Marine Services, Inc., et al. v. Fernan H. Francisco, GR No

167751, March 2, 2011.

Respondent employee filed an illegal dismissal case against the Petitione

Corporation and its President. Though the Court found that Respondenwas illegally dismissed, it held that the President of the PetitionerCorporation should not be held solidarily liable with PetitionerCorporation. Obligations incurred by corporate officers, acting as such

corporate agents, are not theirs but the direct accountabilities of thecorporation they represent. Thus, they should not be generally heldjointly and solidarily liable with the corporation. The general rule igrounded on the theory that a corporation has a legal personalityseparate and distinct from the persons comprising it. As exceptions to thegeneral rule, solidary liability may be imposed: (1) When directors andtrustees or, in appropriate cases, the officers of a corporation (a) vote foor assent to [patently] unlawful acts of the corporation; (b) act in bad

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faith or with gross negligence in directing the corporate affairs; (c) arguilty of conflict of interest to the prejudice of the corporation, itstockholders or members, and other persons; (2) When the director oofficer has consented to the issuance of watered stock or who, havingknowledge thereof, did not forthwith file with the corporate secretaryhi

written objection thereto; (3) When a director, trustee or officer hascontractually agreed or stipulated to hold himself personally andsolidarily liable with the corporation; (4) When a director, trustee orofficer is made, by specific provision of law, personally liable for hicorporate action. To warrant the piercing of the veil of corporate fiction,the officers bad faith or wrongdoing must be established clearly and

convincingly as bad faith is never presumed.

Labor organization;collateral attack onlegal personality.

Samahang Manggagawa sa Charter Chemical Solidarity of Unions in

the Philippines for Empowerment and Reforms [SMCC-SUPER]

Zacarrias Jerry Victorio Union President v. Charter Chemical and

Coating Corporation, G.R. No. 169717, March 16, 2011

Respondent company questioned the legal personality of the petitionerunion in a certification election proceeding. The Court ruled that the legal

personality of the petitioner union cannot be collaterally attacked byrespondent company. Except when it is requested to bargain collectivelyan employer is a mere bystander to any petition for certification election

such proceeding is non-adversarial and merely investigative, consideringthat its purpose is to determine if the employees would like to berepresented by a union and to select the organization that will representhem in their collective bargaining with the employer. The choice of thei

representative is the exclusive concern of the employees; the employecannot have any partisan interest therein; it cannot interfere with, muchless oppose, the process by filing a motion to dismiss or an appeal from it

not even the allegation that some employees participating in a petition focertification election are actually managerial employees will give anemployer legal personality to block the certification election. Theemployers only right in the proceeding is to be notified or informed

thereof.

Labor organization;membership ofsupervisoryemployees.



Zacarrias Jerry Victorio Union President v. Charter Chemical and

Coating Corporation, G.R. No. 169717, March 16, 2011

Petitioner union filed a Petition for Certification Election among thregular rank-and-file employees of the respondent company. Respondencontends that petitioner union is not a legitimate labor organizationbecause its composition is a mixture of supervisory and rank-and-fil

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employees. The Court ruled that the inclusion of the supervisoryemployees in petitioner union does not divest it of its status as alegitimate labor organization. After a labor organization has beenregistered, it may exercise all the rights and privileges of a legitimatelabor organization. Any mingling between supervisory and rank-and-fil

employees in its membership cannot affect its legitimacy for that is noamong the grounds for cancellation of its registration, unless suchmingling was brought about by misrepresentation, false statement ofraud under Article 239 of the Labor Code.

Labor organization;registration.



Zacarrias Jerry Victorio Union President v. Charter Chemical andCoating Corporation, G.R. No. 169717, March 16, 2011

Petitioner union filed a Petition for Certification Election among the

regular rank-and-file employees of the respondent company. Respondencompany filed an Answer with Motion to Dismiss on the ground thapetitioner union is not a legitimate labor organization because of itsfailure to comply with the documentary requirements set by law, i.e. nonverification of the charter certificate. The Court ruled that it was no

necessary for the charter certificate to be certified and attested by thelocal/chapter officers. Considering that the charter certificate is prepared

and issued by the national union and not the local/chapter, it does nomake sense to have the local/chapters officers certify or attest to adocument which they did not prepare. In accordance with this rulingpetitioner unions charter certificate need not be executed under oath

Consequently, it validly acquired the status of a legitimate labororganization upon submission of (1) its charter certificate, (2) the nameof its officers, their addresses, and its principal office, and (3) it

constitution and by-laws the last two requirements having beenexecuted under oath by the proper union officials.

Reinstatement;accrued backwages

Pfizer, Inc., et al. v. Geraldine Velasco, G.R. No. 177467, March 9, 2011

The Labor Arbiter and the NLRC held that petitioner employer illegallydismissed the respondent employee. On appeal, the Court of Appealreversed the decision and ruled that the dismissal was valid. However, thCourt of Appeals ordered petitioner employer to pay respondenemployee her salary from the date of the Labor Arbiters decision

ordering her reinstatement until the Court of Appeals rendered itsdecision declaring the dismissal valid. Petitioner employer questioned thorder and refused to pay. The Court held that even if the order oreinstatement of the Labor Arbiter is reversed on appeal, it is obligatoryon the part of the employer to reinstate and pay the wages of th

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dismissed employee during the period of appeal until reversal by thehigher court. On the other hand, if the employee has been reinstatedduring the appeal period and such reinstatement order is reversed withfinality, the employee is not required to reimburse whatever salary hreceived, more so, if he actually rendered services during the period. Th

payment of such wages cannot be deemed as unjust enrichment onrespondents part.

Reinstatement;immediatelyexecutory order.


The Labor Arbiter held that petitioner employer illegally dismissed therespondent employee. Pending its appeal, petitioner employer failed toimmediately admit respondent employee back to work despite of anorder of reinstatement. The Court held that that the provision of Article223 is clear that an award by the Labor Arbiter for reinstatement shall beimmediately executory even pending appeal and the posting of a bond by

the employer shall not stay the execution for reinstatement. Thelegislative intent is to make an award of reinstatement immediatelyenforceable, even pending appeal. To require the application for andissuance of a writ of execution as prerequisites for the execution of areinstatement award would certainly betray the executory nature of areinstatement order or award. In the case at bar, petitioner employer didnot immediately admit respondent employee back to work whichaccording to the law, should have been done as soon as an order or awardof reinstatement is handed down by the Labor Arbiter without need forthe issuance of a writ of execution.

Reinstatement; termsand conditions.


Due to the order of reinstatement issued by the Labor Arbiter, petitioneremployer sent a letter to the respondent employee to report back to workand assigned her to a new location. The Court held that such is not a bonafide reinstatement. Under Article 223 of the Labor Code, an employeeentitled to reinstatement shall either be admitted back to work under thesame terms and conditions prevailing prior to his dismissal or separationor, at the option of the employer, merely reinstated in the payroll. It iestablished in jurisprudence that reinstatement means restoration to astate or condition from which one had been removed or separated. Theperson reinstated assumes the position he had occupied prior to hisdismissal. Reinstatement presupposes that the previous position fromwhich one had been removed still exists, or that there is an unfilled

position which is substantially equivalent or of similar nature as the onepreviously occupied by the employee. Applying the foregoing principle, icannot be said that petitioner employer has a clear intent to reinstaterespondent employee to her former position under the same terms and

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conditions nor to a substantially equivalent position. To begin with, threturn-to-work order petitioner sent to respondent employee is silenwith regard to the position it wanted the respondent employee to assumeMoreover, a transfer of work assignment without any justification

therefor, even if respondent employee would be presumably doing the

same job with the same pay, cannot be deemed as faithful compliancewith the reinstatement order.

Termination byemployer; willfuldisobedience.

Lores Realty Enterprises, Inc., Lorenzo Y. Sumulong III v. Virginia E.

Pacia, G.R. No. 171189, March 9, 2011

Petitioner employer ordered the respondent employee to prepare checkfor payment of petitioners obligations. Respondent did not immediatelycomply with the instruction since petitioner employer has no sufficien

funds to cover the checks. Petitioner employer dismissed respondenemployee for willful disobedience. The Court held that responden

employee was illegally dismissed. The offense of willful disobediencerequires the concurrence of two (2) requisites: (1) the employees

assailed conduct must have been willful, that is characterized by awrongful and perverse attitude; and (2) the order violated must havebeen reasonable, lawful, made known to the employee and must pertainto the duties which he had been engaged to discharge. Though there isnothing unlawful in the directive of petitioner employer to preparechecks in payment of petitioners obligations, respondent employee

initial reluctance to prepare the checks, although seemingly disrespectfuand defiant, was for honest and well intentioned reasons. Protecting the

petitioner employer from liability under the Bouncing Checks Law wa

foremost in her mind. It was not wrongful or willful. Neither can it beconsidered an obstinate defiance of company authority. The Court take

into consideration that respondent employee, despite her initiareluctance, eventually did prepare the checks on the same day she wastasked to do it.

Wages; facilities andsupplements.

SLL International Cables Specialist and Sonny L. Lagon v. NLRC, Roldan

Lopez, et al., G.R. No. 172161, March 2, 2011

Respondent employees alleged underpayment of their wages. Petitioneemployer claimed that the cost of food and lodging provided by petitioneto the respondent employees should be included in the computation othe wages received by respondents. The Court makes a distinctionbetween facilities and supplements. Supplements constitute extra

remuneration or special privileges or benefits given to or received by the

laborers over and above their ordinary earnings or wages. Facilities, onthe other hand, are items of expense necessary for the laborers and hisfamilys existence and subsistence so that by express provision of law

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they form part of the wage and when furnished by the employer aredeductible therefrom, since if they are not so furnished, the laborer wouldspend and pay for them just the same. In short, the benefit or privilege

given to the employee which constitutes an extra remuneration aboveand over his basic or ordinary earning or wage is supplement; and when

said benefit or privilege is part of the laborers basic wages, it is a facilityThe distinction lies not so much in the kind of benefit or item (food

lodging, bonus or sick leave) given, but in the purpose for which it isgiven. In the case at bench, the items provided were given freely bypetitioner employer for the purpose of maintaining the efficiency and

health of its workers while they were working at their respective projectsThus, the Court is of the view that the food and lodging, or the electricityand water allegedly consumed by respondents in this case were nofacilities but supplements which should not be included in thecomputation of wages received by respondent employees.

Wages; proof ofpayment.

SLL International Cables Specialist and Sonny L. Lagon v. NLRC, RoldanLopez, et al., G.R. No. 172161, March 2, 2011

In an illegal dismissal case against the petitioner employer, respondenemployees alleged that they were underpaid. In their defense, petitioneremployer alleged that respondent employees actually received wagehigher than the prescribed minimum. The Court held that as a generarule, a party who alleged payment of wages as a defense has the burden oproving it. Specifically with respect to labor cases, the burden of proving

payment of monetary claims rests on the employer, the rationale beingthat the pertinent personnel files, payrolls, records, remittances and other

similar documents which will show that overtime, differentials, servicincentive leave and other claims of workers have been paid are not inthe possession of the worker but in the custody and absolute control othe employer. In this case, petitioner employer, aside from barallegations that respondent employees received wages higher than theprescribed minimum, failed to present any evidence, such as payroll orpayslips, to support their defense of payment. Thus, petitioner employerutterly failed to discharge the onus probandi.

Wages; value offacilities.

SLL International Cables Specialist and Sonny L. Lagon v. NLRC, Roldan

Lopez, et al., G.R. No. 172161, March 2, 2011

Petitioner employer alleged that the cost of facilities must be included inthe computation of wages paid. The Court held that before the value ofacilities can be deducted from the employees wages, the following

requisites must all be attendant: first, proof must be shown that suchfacilities are customarily furnished by the trade; second, the provision odeductible facilities must be voluntarily accepted in writing by the

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employee; and finally, facilities must be charged at reasonable value. Meravailment is not sufficient to allow deductions from employees wages

These requirements, however, have not been met in this case. Petitioneremployer failed to present any company policy or guideline showing thaprovisions for meals and lodging were part of the employees salaries. I

also failed to provide proof of the employees written authorization, muchless show how they arrived at their valuations. At any rate, it is not evenclear whether respondent employees actually enjoyed said facilities.

APRIL

Dismissal; breach oftrust and confidence.

James Ben L. Jerusalem v. Keppel Monte Bank, et al., G.R. No. 169564

April 6, 2011

Petitioner was employed as Assistant Vice-President of the JewelryDepartment in respondent bank. His employment was terminated on theground of willful breach of trust and confidence. Jurisprudence provide

for two requisites for dismissal on the ground of loss of trust andconfidence; (1) the employee concerned must be holding a position otrust and confidence, and (2) there must be an act that would justify theloss of trust and confidence. Loss of trust and confidence, to be a valid

cause for dismissal, must be based on a willful breach of trust andfounded on clearly established facts. The basis for the dismissal must bclearly and convincingly established but proof beyond reasonable doubis not necessary. Furthermore, the burden of establishing facts as basesfor an employers loss of confidence is on the employer. The court held

that the termination of petitioner was without just cause and thereforeillegal. Although the first requisite was present, the respondent failed to

satisfy the second requisite. Respondent bank was not able to show anyconcrete proof that petitioner had participated in the approval of thquestioned accounts. The invocation by respondent of the loss of trusand confidence as ground for petitioners termination has therefore no

basis at all.

Breach of Trust andConfidence; duties of

employee.

James Ben L. Jerusalem v. Keppel Monte Bank, et al., G.R. No. 169564

April 6, 2011

Petitioner was employed as Assistant Vice-President of the JewelryDepartment in respondent bank. His employment was terminated on theground of willful breach of trust and confidence for endorsing VISA card

applicants who later turned out to be impostors resulting in financialosses to respondent bank. The court held that petitioner was illegallydismissed. As provided in Article 282 of the Labor Code, an employer mayterminate an employees employment for fraud or willful breach of trusreposed in him. However, in order to constitute a just cause for dismissalthe act complained of must be work-related such as would show th

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employee concerned to be unfit to continue working for the employer

The act of betrayal of trust, if any, must have been committed by theemployee in connection with the performance of his function or positionThe court found that the element of work-connection was not present inthis case since petitioner was assigned under the Jewelry department, and

therefore had nothing to do with the approval of VISA Cards, which waunder a different department altogether.

Certiorari under Rule45; questions of lawand exceptions.

Wilfredo Y. Antiquina v. Magsaysay Maritime Corporation and/or

Masterbulk Pte., Ltd., G.R. No. 168922. April 13, 2011

The Labor Arbiter and the NLRC found that respondent employeneglected to pay petitioners sickness allowance. However, on appeal, theCourt of Appeals reversed such findings and held that petitioneralreadyreceived his sickness allowance from respondent. Petitioner questionedthe ruling of the Court of Appeals by filing a petition for review on

certiorari under Rule 45. The Supreme Court held that, as a rule, onlyquestions of law, not questions of fact, may be raised in a petition foreview on certiorari under Rule 45. However, this principle is subject torecognized exceptions. In the labor law setting, the Court will delve intofactual issues when conflict of factual findings exists among the labo

arbiter, the NLRC, and the Court of Appeals. Considering that in thepresent case there were differing factual findings on the part of the Cour

of Appeals, on one hand, and the Labor Arbiter and the NLRC, on theother, the Supreme Court found it necessary to make an independenevaluation of the evidence on record.

Rules of Procedure;

liberal construction infavor of working class.



Petitioner claimed disability benefits under a Collective Bargaining

Agreement that the respondent employer entered into with a foreignunion. The Court of Appeals refused to admit the evidence of petitionershowing his membership in the union on the ground that it was submittedonly with the Motion for Reconsideration. The Supreme Court, in agreeingto examine the evidence belatedly submitted by petitioner, pointed outhat technical rules of procedure shall be liberally construed in favor othe working class in accordance with the demands of substantial justiceRules of procedure and evidence should not be applied in a very rigid andtechnical sense in labor cases in order that technicalities would not standin the way of equitably and completely resolving the rights andobligations of the parties.

Disability Benefits;

entitlement andburden of proof.



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Petitioner suffered a fractured arm while working on respondents vesseHe filed a complaint for permanent disability benefits, among others

Petitioner claims that he is entitled to the higher amount of disabilitybenefits under the Collective Bargaining Agreement which responden

entered into with a union of which petitioner was a member. The Court of

Appeals denied the petitioners claim. The Supreme Court, in upholdingthe Court of Appeals, held that the burden of proof rests upon the partywho asserts the affirmative of an issue. And in labor cases, the quantum oproof necessary is substantial evidence, or such amount of relevanevidence which a reasonable mind might accept as adequate to justify aconclusion. Petitioner had the duty to prove by substantial evidence hiown positive assertions. He did not discharge this burden of proof whenhe submitted photocopied portions of a different CBA with a differenunion.

Public office; casual

employees.

Philippine Charity Sweepstakes Office Board of Directors and

Reynaldo P. Martin v. Marie Jean C. Lapid, G.R. No. 191940. April 122011

Respondent was a casual teller who was dismissed from service bypetitioner without being formally charged. On appeal, the Civil ServiceCommission (CSC) upheld the dismissal and reasoned that respondenwas a casual employee, and therefore her services may be terminated aany time, without need of a just cause. Upon review, both the Court oAppeals and the Supreme Court found that respondent was illegallyterminated. The Supreme Court recognized its pronouncement in a recencase that Even a casual or temporary employee enjoys security of tenur

and cannot be dismissed except for cause enumerated in Sec. 22, Rule XIVof the Omnibus Civil Service Rules and Regulations and other pertinenlaws. However, the Court also went on to state that, despite this newruling on casual employees, it is not the intention of the Court to make thestatus of a casual employee at par with that of a regular employee, whoenjoys permanence of employment. The rule is still that casuaemployment will cease automatically at the end of the period

Documents

Labor Law 2011