Bago vs. NLRC, April 4, 2007

Facts:
Arlyn Bago (Bago) and five other employees were dismissed by Celia P. Abordo (Abordo), head of the Tuguegarao Branch of Standard Insurance Company Incorporated (SICI) for manipulating the company funds and spreading damaging rumors. Bago, the auditor of the company, and the five other employees apologized for spreading the rumors. Abordo issued a memo to the employees requiring an explanation for the charges. Thinking that Abordo had already forgiven them, the employees did not respond to the memo.
 
Not receiving any reply, the Human Resource Department of SICI proceeded with their investigation and found all the employees guilty and dismissed them for loss of confidence and serious misconduct. Bago filed a complaint for illegal dismissal. She contended that there was no due process in the investigation and that dismissal is a severe penalty for the offenses charged.
 
The Labor Arbiter found that Bago was illegally dismissed but the NLRC reversed the Labor Arbiter's decision and declared valid the termination of Bago’s services on the grounds of loss of trust and confidence and dishonesty.  Bago further claims that she is an ordinary rank-and-file employee, hence, she cannot be dismissed for loss of trust and confidence. The CA found, however, that her work is of such nature as to require a substantial amount of trust and confidence on the part of her employer.

Issue:
Whether the penalty of dismissal was valid despite the fact that the actual amount of money allegedly misappropriated was never established.

Held:
Yes. Arlyn of course incorrectly assumes that mere rank-and-file employees cannot be dismissed on the ground of loss of confidence. Jurisprudence holds otherwise albeit it requires “a higher proof of involvement” in the questioned acts.  a general rule, employers are allowed a wide latitude of discretion in terminating the employment of managerial personnel or those who, while not of similar rank, perform functions which by their nature require the employer’s full trust and confidence. Proof beyond reasonable doubt is not required. It is sufficient that there is some basis for loss of confidence, such as when the employer has reasonable ground to believe that the employee concerned is responsible for the purported misconduct, and the nature of his participation therein renders him unworthy of the trust and confidence demanded by his position. This must be distinguished from the case of ordinary rank-and-file employees, whose termination on the basis of these same grounds requires a higher proof of involvement in the events in question; mere uncorroborated assertions and accusations by the employer will not suffice.
 
Even assuming that Arlyn may be considered a rank-and-file employee, sufficient evidence of her involvement in the dishonest scheme of SICI’s accountant and cashier who were also charged and found guilty exists. Not only was her participation established by the internal audit conducted; the cashier identified her as part of the scheme, and she herself admitted her involvement.