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Manila Mining Corp. Employees Association vs. Manila Mining Corp., September 29, 2010
Manila Mining Corporation (MMC) is a publicly-listed corporation engaged in large-scale mining for gold and copper ore. MMC is required by law to maintain a tailings containment facility to store the waste material generated by its mining operations. Consequently, MMC constructed several tailings dams to treat and store its waste materials. One of these dams was Tailings Pond No. 7 (TP No. 7). An essential component of an ECC is social acceptability or the consent of the residents in the community to allow TP No. 7 to operate, which MMC failed to obtain. Hence, it was compelled to temporarily shut down its mining operations, resulting in the temporary lay-off of more than 400 employees in the mine site. Petitioner Union challenged the validity of their lay-off on the averment that MMC was not suffering from business losses. Petitioners likewise claimed that they were denied due process because they were not given a 30-day notice informing them of the lay-off. Neither was the DOLE informed of this lay-off, as mandated by law.
Whether the temporary suspension of business operations resulting in the temporary lay-off is proper.
Yes. The lay-off is neither illegal nor can it be considered as unfair labor practice. The evidence on record indeed clearly shows that MMC's suspension of its mining operations was bonafide and the reason for such suspension was supported by substantial evidence. MMC cannot conduct mining operations without a tailings disposal system. For this purpose, MMC operates TP No. 7 under a valid permit from the Department of Environment and Natural Resources (DENR) through its Environmental Management Bureau (EMB).
The NLRC did not dispute MMC's claim that it had timely filed an application for renewal of its permit to operate TP No. 7 but that the renewal permit was not immediately released by the DENR-EMB, hence, MMC was compelled to temporarily shutdown its milling and mining operations. Such suspension was brought about by the non-issuance of a permit for the continued operation of TP No. 7 without which MMC cannot resume its milling and mining operations. Further, even as we declare the validity of the lay-off, we cannot say that MMC has no obligation at all to the laid-off employees. The validity of its act of suspending its operations does not excuse it from paying separation pay.
Sometime on June 21, 2007, Prentice (President of Dreamland) and Johnson (Australian Investor) entered into an Employment Agreement, which stipulates among others, that Johnson shall serve as Operations Manager of Dreamland from August 1, 2007 and shall serve as such for a period of three (3) years.
From August 2007, respondent Johnson already reported for work and found out, to his dismay, that the resort was far from finished. He was tasked to supervise the construction and undertook the overall preparation of the guestrooms and staff for the opening of the hotel, even performing menial tasks.
As Johnson remained unpaid since August 2007 and he has loaned all his money to petitioners, he asked for his salary after the resort was opened in October 2007 but the same was not given to him by petitioners. Johnson became very alarmed with the situation as it appears that there was no intention to pay him his salary.
On November 3, 2007, after another embarrassment was handed out by petitioner Prentice in front of the staff, which highlighted his lack of real authority in the hotel and the disdain for him by petitioners, respondent Johnson was forced to submit his resignation. Johnson filed a case for illegal dismissal and non-payment of salaries against petitioners.
LA dismissed the complaint, holding that Johnson voluntarily resigned from his employment. On appeal, the NLRC reversed the LAs decision and ordered petitioners to pay. CA dismissed the appeal on the ground of technicalities.
Whether or not Johnson voluntarily resigned.
No. Although the resort did not open until approximately 8th October 2007, Johnson's employment began, as per Employment Agreement, on 1st August 2007. During the interim period, Johnson was frequently instructed by Prentice to supervise the construction staff and speak with potential future guests who visited the site out of curiosity.
The petitioners maintain that they have paid the amount of P7,200.00 to Johnson for his three weeks of service from October 8, 2007 until November 3, 2007, the date of Johnson's resignation, which Johnson did not controvert. Even so, the amount the petitioners paid to Johnson as his three-week salary is significantly deficient as Johnson's monthly salary as stipulated in their contract isP60,000.00. Thus, the amount which Johnson should have been paid is P45,000.00 and not P7,200.00. In light of this deficiency, there is more reason to believe that the petitioners withheld the salary of Johnson without a valid reason.
It only goes to show that while it was Johnson who tendered his resignation, it was due to the petitioner's acts that he was constrained to resign. The petitioners cannot expect Johnson to tolerate working for them without any compensation.
Since Johnson was constructively dismissed, he was illegally dismissed. Thus, an illegally dismissed employee is entitled to two reliefs: backwages and reinstatement. The two reliefs provided are separate and distinct. In instances where reinstatement is no longer feasible because of strained relations between the employee and the employer, separation pay is granted. In effect, an illegally dismissed employee is entitled to either reinstatement, if viable, or separation pay if reinstatement is no longer viable, and backwages.
Respondent Irene R. Ranchez (Ranchez) was hired as probationary cashier for five (5) months or from October 15, 1997 to March 14, 1998. Two weeks after she was hired, she reported to her supervisor the loss of Php20,299 which she had placed on the company locker. Petitioner Jess Manuel (Manuel) ordered her to be strip-searched by the company guards and reported the matter to the police. Ranchez spent two weeks in jail for failure to immediately post a bail based on information for Qualified Theft filed in the RTC Quezon City.
On November 25, 1997, Ranchez filed a complaint for illegal dismissal and damages. On March 12, petitioners sent Sanchez a notice of termination and/or notice of expiration of probationary employment. The Labor Arbiter dismissed the complaint for illegal dismissal that at the time respondent filed the complaint for illegal dismissal, she was not yet dismissed by petitioners.
NLRC reversed the decision of the Labor Arbiter ruling that Ranchez was denied due process by petitioners. Strip-searching respondent and sending her to jail for two weeks certainly amounted to constructive dismissal because continued employment had been rendered impossible, unreasonable, and unlikely. CA affirmed the decision of NLRC. Petitioners filed a motion for reconsideration. However, the CA denied the same in a Resolution dated May 16, 2007. Hence, this petition.
Whether Ranchez was illegally terminated from employment.
Yes. In the instant case, based on the facts on record, petitioners failed to accord respondent substantive and procedural due process. The haphazard manner in the investigation of the missing cash, which was left to the determination of the police authorities and the Prosecutor's Office, left respondent with no choice but to cry foul. Administrative investigation was not conducted by petitioner Supermarket. On the same day that the missing money was reported by respondent to her immediate superior, the company already pre-judged her guilt without proper investigation, and instantly reported her to the police as the suspected thief, which resulted in her languishing in jail for two weeks.
An illegally or constructively dismissed employee, respondent is entitled to: (1) either reinstatement, if viable, or separation pay, if reinstatement is no longer viable; and (2) backwages. These two reliefs are separate and distinct from each other and are awarded conjunctively.
In this case, since respondent was a probationary employee at the time she was constructively dismissed by petitioners, she is entitled to separation pay and backwages. Reinstatement of respondent is no longer viable considering the circumstances. However, the backwages that should be awarded to respondent shall be reckoned from the time of her constructive dismissal until the date of the termination of her employment, i.e., from October 30, 1997 to March 14, 1998. The computation should not cover the entire period from the time her compensation was withheld up to the time of her actual reinstatement. This is because respondent was a probationary employee, and the lapse of her probationary employment without her appointment as a regular employee of petitioner Supermarket effectively severed the employer-employee relationship between the parties.
Petitioner Saturnino Belen is the Chairman of Diwa Learning Systems, Inc. (DLSI) Board of Directors, part of the conglomeration that include First Asia Ventures Company, Inc. (FAVCI) and Fastech Advanced. Assembly, Inc. (Fastech). Respondent Mary Grace U. De Leon was invited to join Fastech, but was not eventually hired due to a freeze order against the corporation. Gemma P. Asuncion (Asuncion), then Vice-President (VP) of Fastech, endorsed her to DLSI which hired her as Human Resource (HR) Manager later becoming a regular employee. Although her contract was under DLSI, her work encompassed handling the HR Department of the other companies in the conglomeration.
As HR Manager, Mary Grace De Leon gave her opinion in one of the cases handled by her. The management found her opinion unacceptable and even construed it as an insult. From then on, her working relationship with the company turned sour. The management even made imputations that she took part in inciting employees to file labor cases against Diwa. Furthermore, she was unfairly accused of failing to properly perform her job, bypassed in important HR-related decisions, berated in front of her staff, and held accountable for the mistakes of others. These incidents are allegedly well-outlined in the exchanges of electronic mails (e-mails) among Asuncion, respondent and other parties. Mary Grace U. De Leon was informed that the Management wanted her out but it was willing to give her a separation pay. She rejected the offer, convinced she did nothing to warrant the termination of her employment. Asuncion then told respondent that she could go on vacation leave to think about the management's offer, but respondent declined.
Petitioners Diwa and Saturnino Belen countered that respondent was dismissed for cause, i.e., for her unauthorized absences. They also denied that respondent was demoted or suffered a diminution of benefits or offering monetary consideration to respondent. Respondent Mary Grace U. De Leon filed a Complaint against petitioners for constructive dismissal, docketed in NLRC NCR.
Labor Arbiter dismissed respondent Mary Grace U. De Leon’s complaint for constructive dismissal for lack of merit. Sustaining petitioners Diwa and Saturnino Belen’s argument that if negative feedbacks and reprimand were a form of harassment, an employer would virtually be powerless to call the attention of and correct their officers.
NLRC initially granted Mary Grace De Leon’s appeal but later affirmed Labor Arbiter’s dismissal of the complaint.
Court of Appeals set aside the decision of the NLRC and reinstated the NLRC’s earlier decision. CA denied the petitioner’s motion for reconsideration.
Whether or not there was constructive dismissal.
Yes. The communications between Asuncion and De Leon, both as to language and tone, indicate a pattern of fault-finding and nit-picking, and an attitude of disdain.
According to the Supreme Court, "Constructive dismissal is a cessation of work because continued employment is rendered impossible, unreasonable or unlikely; when there is a demotion in rank or diminution in pay or both; or when a clear discrimination, insensibility, or disdain by an employer becomes unbearable to the employee." It is an act amounting to dismissal but made to appear as if it were not. In other words, it is a dismissal in disguise.
The test of constructive dismissal is whether a reasonable person in the employee's position would have felt compelled to give up his position under the circumstances. Considering the facts of this case, the Supreme Court agreed with the CA that respondent was constructively dismissed.
Baya is employed by AMSFC and worked his way to become a supervisor. Baya joined the union of supervisors, and eventually, formed AMS Kapalong Agrarian Reform Beneficiaries Multipurpose Cooperative (AMSKARBEMCO). Later on and upon AMSKARBEMCO's petition before the Department of Agrarian Reform (DAR), some 220 hectares of AMSFC's 513-hectare banana plantation were covered by the Comprehensive Agrarian Reform Law. Eventually, said portion was transferred to AMSFC's regular employees as Agrarian Reform Beneficiaries (ARBs), including Baya. The ARBs explored a possible agribusiness venture agreement with AMSFC, but the talks broke down. When AMSFC learned that AMSKARBEMCO entered into an export agreement with another company, it summoned AMSKARBEMCO officers, including Baya, to lash out at them and even threatened them that the ARBs' takeover of the lands would not push through. Thereafter, Baya was again summoned, this time by a DFC manager, who told the former that he would be putting himself in a "difficult situation" if he will not shift his loyalty to SAFFPAI; this notwithstanding, Baya politely refused to betray his cooperative. A few days later, Baya received a letter stating that his secondment with DFC had ended, thus ordering his return to AMSFC. However, upon Baya's return to AMSFC on August 30, 2002, he was informed that there were no supervisory positions available; thus, he was assigned to different rank-and-file positions instead. On September 20, 2002, Baya's written request to be restored to a supervisory position was denied, prompting him to file the instant complaint. AMSFC and DFC maintained that they did not illegally/constructively dismiss Baya, considering that his termination from employment was the direct result of the ARBs' takeover of AMSFC's banana plantation through the government's agrarian reform program.
Whether or not AMSFC and DFC constructively dismissed Baya.
Yes. "Constructive dismissal exists where there is cessation of work, because 'continued employment is rendered impossible, unreasonable or unlikely, as an offer involving a demotion in rank or a diminution in pay' and other benefits. Aptly called a dismissal in disguise or an act amounting to dismissal but made to appear as if it were not, constructive dismissal may, likewise, exist if an act of clear discrimination, insensibility, or disdain by an employer becomes so unbearable on the part of the employee that it could foreclose any choice by him except to forego his continued employment."
In Peckson v. Robinsons Supermarket Corp., the Court held that the burden is on the employer to prove that the transfer or demotion of an employee was a valid exercise of management prerogative and was not a mere subterfuge to get rid of an employee; failing in which, the employer will be found liable for constructive dismissal, viz.:
In case of a constructive dismissal, the employer has the burden of proving that the transfer and demotion of an employee are for valid and legitimate grounds such as genuine business necessity. Particularly, for a transfer not to be considered a constructive dismissal, the employer must be able to show that such transfer is not unreasonable, inconvenient, or prejudicial to the employee; nor does it involve a demotion in rank or a diminution of his salaries, privileges and other benefits. Failure of the employer to overcome this burden of proof, the employee's demotion shall no doubt be tantamount to unlawful constructive dismissal.
In this case, a judicious review of the records reveals that the top management of both AMSFC and DFC, which were sister companies at the time, were well-aware of the lack of supervisory positions in AMSFC. This notwithstanding, they still proceeded to order Baya's return therein, thus, forcing him to accept rank-and-file positions. Notably, AMSFC and DFC failed to refute the allegation that Baya's "end of secondment with DFC" only occurred after: (a) he and the rest of AMSKARBEMGO officials and members were subjected to harassment and cooperative busting tactics employed by AMSFC and DFC; and (b) he refused to switch loyalties from AMSKARBEMCO to SAFFPAI, the pro-company cooperative. In this relation, the Court cannot lend credence to the contention that Baya's termination was due to the ARBs' takeover of the banana plantation, because the said takeover only occurred on September 20, 2002, while the acts constitutive of constructive dismissal were performed as early as August 30, 2002, when Baya returned to AMSFC. Thus, AMSFC and DFC are guilty of constructively dismissing Baya.
1. Casiño was hired by petitioner as Stock Custodian and Cook in the latter's Kubong Sawali Restaurant. Upon discovery of theft involving company property where respondent was allegedly a conspirator, a criminal complaint for qualified theft against him and his co-employees was filed.
2. Additionally, he and his co-employees were preventively suspended indefinitely pending investigation. He was informed of the suspension through a Memorandum Order dated November 27, 2012, effective the next day for an indefinite period of time.
3. Meanwhile, the criminal complaint for qualified theft was later dismissed for lack of basis.
4. Sometime thereafter, he received a letter where he was made to explain why his services should not be terminated for grave misconduct arising from the pilferages committed. This letter was addressed only to Lornboy (co-employee) but respondent considered said letter as a directive for him to give said explanation.
Whether or not there was constructive dismissal .
In the case at hand, there is no question that what was meted was an indefinite preventive suspension pending investigation as clearly stated in the Memorandum Order. This, in itself, is already a clear violation of the proscription against indefinite or prolonged preventive suspensions, making the suspension tantamount to constructive dismissal as repeatedly held by this Court in a long line of cases.
Petitioner Intec Cebu Inc. (Intec) hired respondents as production workers. Respondents alleged that their working days were reduced from 6 to 2-4 days. Intec apparently explained that reduction in working days was due to lack of job orders. However, respondents discovered that Intec hired around 188 contractual employees tasked to perform tasks which respondents were regularly doing. Private respondents claimed that they were effectively terminated from employment as shown in the Establishment Termination Report6 submitted to the Department of Labor and Employment (DOLE). Two (2) days later, respondents filed a complaint for illegal dismissal.
The Labor Arbiter, Jermelina Pasignajen Ay-ad declared that respondents were illegally dismissed and adjudged Intec and its officials liable for payment of separation pay and backwages. The NLRC set aside the Decision of the Labor Arbiter. The Court of Appeals reversed the NLRC and reinstated the Decision of the Labor Arbiter
Whether the respondents were dismissed either actually or constructively.
Yes. Intec committed illegal reduction of work hours. Constructive dismissal occurs when there is cessation of work because continued employment is rendered impossible, unreasonable or unlikely; when there is a demotion in rank or diminution in pay or both; or when a clear discrimination, insensibility, or disdain by an employer becomes unbearable to the employee.13
Intec’s unilateral and arbitrary reduction of the work day scheme had significantly greatly reduced respondents’ salaries thereby rendering it liable for constructive dismissal.
Irene Sanchez was a probationary employee of Robinsons for a period of 5 months. 2 weeks after she was hired, she reported to her supervisor the loss of cash amounting to P20, 299.00. Jess Manuel, Operations Manager, ordered that Sanchez be strip-searched by the guards but yielded nothing. Manuel reported her to the police. An information for Qualified Theft was filed and Sanchez was constrained to spend 2 weeks in jail. On Nov. 25, 1997, Sanchez filed a complaint for illegal dismissal. On Mar. 12, 1998, Robinsons sent to Sanchez by mail a Notice of Termination and Notice of Expiration of Probationary Employment dated Mar. 8, 1998. The LA dismissed the claim of illegal dismissal and ordered Robinsons to accept Sanchez to her former or equivalent work. On appeal, the NLRC reversed the decision and ordered Robinsons to immediately reinstate Sanchez to her former or equivalent position and to pay her full backwages computed from the time she was constructively dismissed on Oct. 30, 1997 up to reinstatement. NLRC ruled that Sanchez was denied due process. Strip-searching and sending her to jail for 2 weeks amounted to constructive dismissal because continued employment had been rendered impossible, unreasonable, and unlikely. The CA affirmed the NLRC’s decision with modification that if reinstatement should be impossible in view of the strained relation between the parties, the Robinsons are ordered to pay Sanchez separation pay equivalent to 1 month pay in addition to back wages from the date of dismissal.
Was there a constructive dismissal.
Yes. A probationary employee, like a regular employee, enjoys security of tenure. Art. 277(b) of the LC mandates that the employer shall furnish the worker a written notice containing a statement of causes of termination, and shall afford the latter ample opportunity to be heard and defend himself. In the instant case, Robinsons failed to accord Sanchez substantive and procedural due process. On the same day the money was reported missing, the company already prejudged her guilt without proper investigation, and instantly reported her to the police as the suspected thief, which resulted in her languishing in jail for 2 weeks. As correctly pointed out by the NLRC, the due process requirements under the LC are mandatory and may not be supplanted by police investigation or court proceedings. Thus, employers are mandated to conduct their own separate investigation, and to accord the employee every opportunity to defend himself. Sanchez was constructively dismissed by Robinsons effective Oct. 30, 1997. However, the backwages that should be awarded to Sanchez shall be reckoned from the date of her constructive dismissal until the date of termination of her employment, i.e., from Oct. 30, 1997 to Mar. 14,1998. This is because Sanchez was a probationary employee, and the lapse of her probationary employment without her appointment as a regular employee of Robinsons effectively severed the employeremployee relationship between the parties.
Petitioner University of the Immaculate Conception is a private educational institution located in Davao City. Private respondent Teodora C. Axalan is a regular faculty member in the university holding the position of Associate Professor II. Aside from being a regular faculty member, Axalan is the elected president of the employees’ union.
From 18 November to 22 November 2002, Axalan attended a seminar in Quezon City on website development. Axalan then received a memorandum from Dean Maria Rosa Celestial asking her to explain in writing why she should not be dismissed for having been absent without official leave.
In her letter, Axalan claimed that she held online classes while attending the seminar. She explained that she was under the impression that faculty members would not be marked absent even if they were not physically present in the classroom as long as they conducted online classes.
In reply, Dean Celestial relayed to Axalan the message of the university president that no administrative charge would be filed if Axalan would admit having been absent without official leave and write a letter of apology seeking forgiveness.
Convinced that she could not be deemed absent since she held online classes, Axalan opted not to write the letter of admission and contrition the university president requested. The Dean wrote to Axalan that the university president had created an ad hoc grievance committee to investigate the AWOL charge.
From 28 January to 3 February 2003, Axalan attended a seminar in Baguio City on advanced paralegal training. Dean Celestial wrote to Axalan informing her that her participation in the paralegal seminar in Baguio City was the subject of a second AWOL charge. The dean asked Axalan to explain in writing why no disciplinary action should be taken against her.
In her letter, Axalan explained that before going to Baguio City for the seminar, she sought the approval of Vice-President for Academics Alicia Sayson. In a letter, VP Sayson denied having approved Axalan’s application for official leave. The VP stated in her letter that it was the university president, Maria Assumpta David, who must approve the application.
After conducting hearings and receiving evidence, the ad hoc grievance committee found Axalan to have incurred AWOL on both instances and recommended that Axalan be suspended without pay for six months on each AWOL charge. The university president approved the committee’s recommendation.
The university president then wrote Axalan informing her that she incurred absences without official leave when she attended the seminars on website development in Quezon City and on advanced paralegal training in Baguio City on 18-22 November 2002 and on 28 January-3 February 2003, respectively. In the same letter, the university president informed Axalan that the total penalty of one-year suspension without pay for both AWOL charges would be effective immediately.
On 1 December 2003, Axalan filed a complaint against the university for illegal suspension, constructive dismissal, reinstatement with backwages, and unfair labor practice with prayer for damages and attorney’s fees.
Is the University of Immaculate Conception guilty of constructive dismissal.
Constructive dismissal occurs when there is cessation of work because continued employment is rendered impossible, unreasonable, or unlikely as when there is a demotion in rank or diminution in pay or when a clear discrimination, insensibility, or disdain by an employer becomes unbearable to the employee leaving the latter with no other option but to quit.
In this case however, there was no cessation of employment relations between the parties. It is unrefuted that Axalan promptly resumed teaching at the university right after the expiration of the suspension period. In other words, Axalan never quit. Hence, Axalan cannot claim that she was left with no choice but to quit, a crucial element in a finding of constructive dismissal. Thus, Axalan cannot be deemed to have been constructively dismissed.
The husband of the petitioner was dismissed from the service because of his low performance rating. Petitioner wrote respondent Fr. Bustamante, questioning the performance rating given to her husband. She attached to her letter documents containing the summary of efficiency ratings of all the teachers. She retrieved these documents from the filing cabinet. Petitioner then received a letter from respondent Fr. Bustamante, requiring her to explain in writing why she should not be dismissed from employment for willful breach of trust reposed on her.
Later, Fr. Manuel Remirez, the school treasurer, summoned her to his office, compelling her to tender her resignation within 30 minutes, otherwise, she will not receive her separation pay. Petitioner pleaded for one day deferment but was denied. Considering that her husband was jobless and that her family was in financial predicament, the petitioner submitted her resignation letter on the very same day. Subsequently, she received her separation pay.
Petitioner then filed with the Labor Arbiter a complaint for illegal dismissal. Respondents, in their answer, denied the allegations in the complaint, contending that petitioner voluntarily submitted her resignation letter. The Labor Arbiter promulgated a Decision finding that petitioner was constructively dismissed from employment.
On appeal, the National Labor Relations Commission (NLRC) reversed the Labor Arbiter's judgment, holding that based on the documentary evidence presented by respondents, the petitioner voluntarily resigned.
Whether the petitioner was constructively dismissed from the service.
Yes. To be a valid ground for dismissal, loss of trust and confidence must be based on a wilful breach of trust and founded on clearly established facts. A breach is wilful if it is done intentionally, knowingly and purposely, without justifiable excuse, as distinguished from an act done carelessly, thoughtlessly, heedlessly or inadvertently. It must rest on substantial grounds and not on the employer's arbitrariness, whims, caprices or suspicion. Otherwise, the employee would eternally remain at the mercy of the employer.
In Nokom v. National Labor Relations Commission, the Court set the guidelines for the application of loss of confidence as a just cause for dismissing an employee from the service, thus:
a. loss of confidence should not be simulated;
b. it should not be used as a subterfuge for causes which are improper, illegal or unjustified;
c. it may not be arbitrarily asserted in the face of overwhelming evidence to the contrary; and
d. it must be genuine, not a mere afterthought to justify earlier action taken in bad faith.
An examination of the records showed that petitioner was indeed made to resign against her will with threat that she will not be given her separation pay should she fail to do so. Clearly, her consent was vitiated. Indeed, it is very unlikely that the petitioner, who worked in the school for almost fifteen (15) years, would simply resign voluntarily. Her receipt of the benefits could be considered as an act of self-preservation, taking into consideration the financial predicament she and her family were then facing.
Thus, the Court ruled that the petitioner was constructively dismissed from her employment. There is constructive dismissal if an act of clear discrimination, insensibility, or disdain by an employer becomes so unbearable on the part of the employee that it would foreclose any choice by him except to forego her continued employment. It exists where there is cessation of work because "continued employment is rendered impossible, unreasonable or unlikely, as an offer involving a demotion in rank and a diminution in pay."
Respondent was initially hired by Petitioner Norkis as Norkis Installment Collector (NIC). Petitioner Albos is the Senior Vice-President of petitioner Norkis. Respondent held various positions in the company until he was appointed as Credit and Collection Manager of petitioner Norkis’s sister company. It was found out in a special audit that respondent forwarded the monthly collection reports of the NICs under his supervision without checking the veracity of the same. It appeared that the monthly collection highlights for six months were all overstated, particularly the account handled by NIC Dennis Cadag, who made it appear that the collection efficiency was higher than it actually was misleading the top management.
Respondent was then charged with negligence of basic duties and responsibilities resulting in loss of trust and confidence and laxity in directing and supervising his own subordinates.
Respondent admitted that he was negligent for failing to regularly check the report of each NIC under his supervision. He however denied being lax in supervising his subordinates, as he imposed discipline on them if the need arose.
Petitioner Norkis issued a memorandum placing respondent under 15 days suspension without pay, travel and transportation allowance, effective upon receipt thereof. Respondent filed a letter protesting his suspension and seeking a review of the penalty imposed. Another memorandum was issued to the respondent requiring him to report to the head office of petitioner Norkis in Mandaluyong City for a re-training or a possible new assignment without prejudice to his request for a reconsideration or an appeal of his suspension. He was then assigned to the Marketing Division directly reporting to petitioner Albos.
Respondent requested petitioner Albos that he be assigned as Sales Engineer or to any position commensurate with his qualifications. However, respondent was formally appointed as Marketing Assistant to petitioner Albos, which position respondent subsequently assumed. As such, respondent filed with the Labor Arbiter (LA) a complaint for illegal suspension, constructive dismissal, non-payment of allowance, vacation/sick leave, damages and attorney's fees against petitioners.
The LA rendered his decision dismissing the complaint for lack of merit. On appeal, the NLRC reversed the decision of the LA declaring that the transfer of Respondent resulted in his demotion in rank from Manager to a mere rank and file employee, which was tantamount to constructive dismissal and therefore illegal. Petitioner Norkis files its MR but was denied. The CA, likewise, dismissed their Petition and affirmed the resolution of the NLRC.
Whether or not respondent's transfer from the position of Credit and Collection Manager to that of a Marketing Assistant amounts to a constructive dismissal.
Yes. Demotion involves a situation in which an employee is relegated to a subordinate or less important position constituting a reduction to a lower grade or rank, with a corresponding decrease in duties and responsibilities, and usually accompanied by a decrease in salary. In this case, while the transfer of respondent from Credit and Collection Manager to Marketing Assistant did not result in the reduction of his salary, there was a reduction in his duties and responsibilities which amounted to a demotion tantamount to a constructive dismissal as correctly held by the NLRC and the CA.
A comparison in the nature of work of these two positions shows a great difference. As Credit and Collection Manager, respondent was clothed with all the duties and responsibilities of a managerial employee. He could devise and implement action plans to meet his objectives and exercise independent judgment in resolving problem accounts. He had power and control over NICs, Branch Control Officers (BCOs) and Cashiers under his supervision, and he provided them training in the performance of their respective works. Further, he had the authority to ensure reserves in the NICs, BCOs and Cashiers in case of expansion, reassignment and/or termination. There is no doubt that said position of Credit and Collection Manager entails great duties and responsibilities and involves discretionary powers. In fact, even in petitioners’ pleadings, they repeatedly stated that the position involved a high degree of responsibility requiring trust and confidence as it relates closely to the financial interest of the company.
On the other hand, the work of a Marketing Assistant is clerical in nature, which does not involve the exercise of any discretion. Such job entails mere data gathering on vital marketing information relevant to petitioners' motorcycles and making reports to his direct supervisor. He is a mere staff member in the office of the Senior Vice-President for Marketing.
While petitioners claim that the position of a Marketing Assistant covers a wide area as compared with the position of Credit and Collection Manager, the latter is reposed with managerial duties in overseeing petitioners’ business in his assigned area, unlike the former in which he merely collates raw data. These two positions are not of the same level of authority.
There is constructive dismissal when an employee's functions, which were originally supervisory in nature, were reduced; and such reduction is not grounded on valid grounds such as genuine business necessity.
Kawada was a Full Assistant Store Manager at Uniwide. Later, Uniwide, through Store Manager Apduhan, issued a Memorandum addressed to Kawada summarizing the various reported incidents signifying unsatisfactory performance on the latter’s part. On an earlier setting on the investigation of her case, Kawada filed a sick leave, thus causing the hearing/investigation to be rescheduled. Again, upon rescheduling, Kawada, despite notice and warning that failure to appear would mean abandonment of her work, did not appear, this time coming up with the excuse that she had been already “constructively dismissed”. Uniwide terminated her work.
Private respondent claims that from the months of February to June 1998, she had been subjected to constant harassment, ridicule and inhumane treatment by Apduhan, with the hope that the latter can get the private respondent to resign. The harassment allegedly came in the form of successive memoranda which private respondent She filed a case for illegal dismissal.
LA dismissed the case but NLRC ruled in favor of Kawada. Upon appeal by Uniwide, CA affirmed NLRC’s decision.
Whether or not respondent was constructively dismissed.
No. Case law defines constructive dismissal as a cessation of work because continued employment is rendered impossible, unreasonable or unlikely; when there are a demotion in rank or diminution in pay or both; or when a clear discrimination, insensibility, or disdain by an employer becomes unbearable to the employee.
The test of constructive dismissal is whether a reasonable person in the employee's position would have felt compelled to give up his position under the circumstances. It is an act amounting to dismissal but made to appear as if it were not. In fact, the employee who is constructively dismissed may be allowed to keep on coming to work. Constructive dismissal is therefore a dismissal in disguise.
The law recognizes and resolves this situation in favor of employees in order to protect their rights and interests from the coercive acts of the employer. The Court finds that private respondent's allegation of harassment is a specious statement which contains nothing but empty imputation of a fact that could hardly be given any evidentiary weight by this Court. Private respondent's bare allegations of constructive dismissal, when uncorroborated by the evidence on record, cannot be given credence.
The right to impose disciplinary sanctions upon an employee for just and valid cause, as well as the authority to determine the existence of said cause in accordance with the norms of due process, pertains in the first place to the employer. Clearly, the memoranda are not forms of harassment, but petitioners' compliance with the requirements of due process.
Decorion was a regular employee of Mariculum Mining who was placed under preventive suspension. He was placed under suspension because of his failure to attend a meeting that prompted the management not to allow him report to work for the following day. After a month, Decorion was served a Notice of Infraction and Proposed Dismissal to enable him present his side which prompted him to file a complaint for illegal dismissal. This made Decorion’s indefinite suspension be made definite with a warning that violation of the same conduct would be punished with dismissal. Months after, he was served a memo telling him of his temporary lay-off due to Maricalum’s temporary suspension of its operations. Decorion, through his counsel, requested that he be reinstated which was, unfortunately, denied. Maricalum insist that Decorion was not dismissed but merely preventively suspended
Was the preventive suspension valid/proper.
The SC held that sections 8 and 9 of Rule XXIII, Book V of the Implementing Rules are explicit that preventive suspension is justified where the employee’s continued employment poses a serious and imminent threat to the life or property of the employer or of the employee’s co-workers. Without this kind of threat, preventive suspension is not proper.
In this case, Decorion was suspended only because he failed to attend a meeting called by his supervisor. There is no evidence to indicate that his failure to attend the meeting prejudiced his employer or that his presence in the company’s premises posed a serious threat to his employer and co-workers. The preventive suspension was clearly unjustified. What is more, Decorion’s suspension persisted beyond the 30-day period allowed by the Implementing Rules. Preventive suspension which lasts beyond the maximum period allowed by the Implementing Rules amounts to constructive dismissal.
Similarly, from the time Decorion was placed under preventive suspension on April 11, 1996 up to the time a grievance meeting was conducted on June 5, 1996, 55 days had already passed. Another 48 days went by before he filed a complaint for illegal dismissal on July 23, 1996. Thus, at the time Decorion filed a complaint for illegal dismissal, he had already been suspended for a total of 103 days.