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Mercado v. AMA Computer College, G.R. No. 183572, April 13, 2010

FACTS:

Five former faculty members of AMA Computer College in Paraaque City executed individual Teachers Contracts

for each of the trimesters they were engaged to teach. For the school year 2000-2001, when AMACC implemented

new faculty screening guidelines, the petitioners failed to obtain a passing rating based on the performancestandards. Thus, AMACC did not give them any salary increase. Due to this, they filed a complaint for

underpayment of wages. Consequently, they were dismissed as their contracts have expired & were not renewed.

The Labor Arbiter ruled that they had been illegally dismissed. The NLRC affirmed the LAs decision. In addition,

however, it observed that the applicable law is Section 92 of the Manual of Regulations for Private Schools (which

mandates aprobationary period of nine consecutive trimesters of satisfactory service for academic personnel in the

tertiary level where collegiate courses are offered on a trimester basis), not Article 281 of the Labor Code (which

prescribes a probationary period of six months) as the LA ruled. Despite this, the NLRC still affirmed the LAs

finding of illegal dismissal on the basis of standards that were only introduced near the end of their probationary

period and not at the time of engagement. The CA dismissed the action for illegal dismissal ruling that under the

Manual for Regulations for Private Schools, a teaching personnel in a private educational institution (1) must be a full

time teacher; (2) must have rendered three consecutive years of service; and (3) such service must be satisfactory

before he or she can acquire permanent status.

Since they had not completed three (3) consecutive years of service (i.e. six regular semesters or nine consecutive

trimesters of satisfactory service) and were still within their probationary period, then they cannot acquire permanent

status. The non-renewal of contract is a valid management prerogative.

ISSUE:

Whether or not the dismissal is valid.

RULING:

AMACC failed to prove by substantial evidence that there was just cause for the non- renewal of the petitionerscontracts.

The Labor Code is supplemented with respect to the period of probation by special rules found in the Manual of

Regulations for Private Schools.On the matter of probationary period, Section 92 of these regulations provides:

Section 92. Probationary Period. Subject in all instances to compliance with the Department and school

requirements, the probationary period for academic personnel shall not be more than three (3) consecutive years of

satisfactory service for those in the elementary and secondary levels, six (6) consecutive regular semesters of

satisfactory service for those in the tertiary level, and nine (9) consecutive trimesters of satisfactory service for those

in the tertiary level where collegiate courses are offered on a trimester basis.

Other than on the period, the following quoted portion of Article 281 of the Labor Code still fully applies: The

services of an employee who has been engaged on a probationary basis may be terminated for a just cause when hefails to qualify as a regular employee in accordance with reasonable standards made known by the employer to the

employee at the time of his engagement. An employee who is allowed to work after a probationary period shall be

considered a regular employee.

The common practice is for the employer and the teacher to enter into a contract, effective for one school year. At the

end of the school year, the employer has the option not to renew the contract, particularly considering the teachers

performance. If the contract is not renewed, the employment relationship terminates. If the contract is renewed,

usually for another school year, the probationary employment continues. Again, at the end of that period, the parties

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may opt to renew or not to renew the contract. If renewed, this second renewal of the contract for another school year

would then be the last year since it would be the third school year of probationary employment. At the end of this

third year, the employer may now decide whether to extend a permanent appointment to the employee, primarily on

the basis of the employee having met the reasonable standards of competence and efficiency set by the employer. For

the entire duration of this three-year period, the teacher remains under probation. Upon the expiration of his contract

of employment, being simply on probation, he cannot automatically claim security of tenure and compel the

employer to renew his employment contract.

The school, however, cannot forget that its system of fixed-term contract is a system that operates during the

probationary period and for this reason is subject to the terms of Article 281 of the Labor Code. Given the clear

constitutional and statutory intents, we cannot but conclude that in a situation where the probationary status

overlaps with a fixed-term contract not specifically used for the fixed term it offers, Article 281 should assume

primacy and the fixed-period character of the contract must give way.

While we can grant that the standards were duly communicated to the petitioners and could be applied beginning

the 1st trimester of the school year 2000-2001, glaring and very basic gaps in the schools evidence still exist. The

exact terms of the standards were never introduced as evidence; neither does the evidence show how these

standards were applied to the petitioners. Hence, the dismissal was illegal.

57. Pantoja vs. SCA Hygiene Products Corp., G.R. No. 163554, April 23, 2010

Facts:

SCA Hygiene Products Corp. ( SCA Hygiene for short), a corporation engaged in sale, making and distribution of

tissue products and industrial paper, hired Pantoja on March 1987 as back tender taking charge of operations in one

of SCA Hygienes mill ( Paper Mill No.4).On March 1999, Pantoja received a Notice of Transfer offering him a position

at Paper Mill No. 5 under the same terms and conditions of employment for an anticipated shutdown of Paper Mill

No.4 to streamline and phase out the companys industrial paper manufacturing operations in Paper Mill No.4 due

to financial difficulties brought about by the low volume of sales and orders for industrial paper products. But

Pantoja (and some others offered with transfers ) refused to be transferred of which his services were terminated by

reason of redundancy of position. Pantoja then received separation pay (which was handsomely over and above whatwas provided by law) and executed a release and quitclaim in the corps favor. However, on June 2000, Pantoja filed a

complaint for illegal dismissal against SCA Hygiene for lack of valid cause. Pantoja interposed that no permanent

shutdown of Paper Mill No. 4 due to its continuous operation since his termination, presenting in evidence Paper

Mill Personnel Schedule for Mill No.4 for June, July and August 2000; thus, corp. was in bad faith trying to

circumvent his tenurial security when no substantial reason exist. Labor Arbiter dismissed Pantojas complaint stating

his rejection of transfer and receipt of the separation pay belie Pantojas illegal dismissal. On appeal by Pantoja, NLRC

reversed the Arbiters decision stating the redundancy program is legally infirm on feigned shutdown of operations.

On reconsideration by SCA Hygiene asseverating that on 1999 when Mill No.4 was shut down due to low production

output, there was a necessity to occasionally run from time to time the machines only for the purpose of maintaining

and preserving the same and does not mean that Paper Mill No. 4 continued to be operational. Yet, NLRC remain

unpersuaded. On appeal by SCA Hygiene, CA reinstated Labor Arbiters decision.

Issue:

1. Whether or not Pantoja was illegally dismissedRuling:

Pantoja is not illegally dismissed. SCA Hygienes right of management prerogative was exercis ed in good faith. In

International Harvester Macleod, Inc. v. Intermediate Appellate Court, the determination of the need to phase out a

particular department and consequent reduction of personnel and reorganization as a labor and cost saving device is

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a recognized management prerogative which the courts will not generally interfere with. Circumstances pointing

good faith on SCA Hygienes part - the abolishment of Paper Mill No. 4 was a business judgment arrived at due to

low demand for the production of industrial paper at the time. Despite an apparent reason to implement a

retrenchment program as a cost-cutting measure, SCA Hygiene, did not outrightly dismiss the workers affected by

the closure of Paper Mill No. 4 but gave them an option to be transferred to posts of equal rank and pay. As can be

seen, retrenchment was utilized by respondent only as an available option in case the affected employee would not

want to be transferred. SCA Hygiene did not proceed directly to retrench. This, to our mind, is an indication of goodfaith on respondents part as it exhausted other possible measures other than retrenchment. Besides, the employers

prerogative to bring down labor costs by retrenching must be exercised essentially as a measure of last resort, after

less drastic means have been tried and found wanting. Giving the workers an option to be transferred without any

diminution in rank and pay specifically belie petitioners allegation that the alleged streamlining scheme was

implemented as a ploy to ease out employees, thus, the absence of bad faith. No evidence, however, was presented to

prove that there was continuous operation after the shutdown in the year 1999. On record, Paper Mill No. 4 resumed

its operation in 2000 due to a more favorable business climate. The resumption of its industrial paper manufacturing

operations does not, however, make respondents streamlining/reorganization plan illegal because, again, the

abolishment of Paper Mill No. 4 in 1999 was a business judgment arrived at to prevent a possible financial drain at

that time. As long as no arbitrary or malicious action on the part of an employer is shown, the wisdom of a business

judgment to implement a cost saving device is beyond this courts determination. Work reassignment of an employee

as a genuine business necessity is a valid management prerogative. Even though the transfer would not involve any

diminution of rank and pay, still Pantoja refused the transfer and instead, accepted the separation pay voluntarily.

The consideration for the quitclaim is credible and reasonable, the waiver represents a valid and binding

undertaking. No force and duress attended in its execution. The corp. even gave Pantoja a separation pay more than

what the law requires from respondent.

58. BPI v. NLRC, G.R. No. 179801, June 18, 2010

FACTS:

Records show that respondent, Arambulo, was initially employed as Clerk in 1972 at Citytrust Banking Corporation,

which eventually merged with the Bank of Philippine Islands (BPI). She later became Lead Teller, then as Sales

Manager, and subsequently, as Bank Manager in BPI-San Pablo, Laguna Branch in 1996.

On 4 October 2001, she was reprimanded for the improper handling and retention of a clients account. She was

transferred to BPI Family Bank in Los Baos, Laguna on 21 November 2001.

On 26 April 2002, a client of BPI-San Pablo, Laguna Branch requested for a certification of her savings account. Her

balance reflected an amount less than the actual amount deposited. Hence, BPI conducted an investigation and

discovered that its bank teller, Teotima Helen Azucena (Azucena) was making unauthorized withdrawals. A show

cause memorandum was served to Azucena asking her to explain the unauthorized withdrawals. In her written

response, Azucena implicated respondent, in that the latter, on many occasions, would make temporary cash

borrowings and would return the money at the end of the day through withdrawals from her own or other clients

accounts. There were times when respondent would fail to return the money withdrawn resulting in shortages on the

part of Azucena. When respondent was transferred to Los Baos, Laguna, Azucena added that the same practice was

continued by her son, Artie Arambulo.

BPI conducted a thorough investigation and discovered that respondent had approved several withdrawals from

various accounts of clients whose signatures were forged.

The assistant branch manager of the said branch also imputed fault to Arambulo.

Arambulo admitted that she prepared the unsigned withdrawal slips on the account of Mr. Vicente Amante (Mr.

Amante) totalingP700,000.00 upon request of the latter. She also explained that she processed the withdrawal slips of

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FACTS:

Petitioner Maribago isacorporationoperatingaresorthotelandrestaurantinBarangayMaribago,Lapu-LapuCity.

In 19953, it hired respondent Dual as waiter and promoted him later as outlet cashier of its Poolbar/Allegro

Restaurant.

Sometime in 2005,a groupofJapaneseguestsandtheircompanionsdinedatAllegro.CaptainwaiterHiyastooktheir

dinnerorderscomprisingofsix(6)setsoflambandsix(6)setsoffish.Aspercompanyprocedure,Hiyasforwarded

onecopyoftheordersliptothekitchenandanothercopytorespondent. Pursuanttotheorderslip,fourteen(14)

setsofdinnerwerepreparedbythechef. HiyasandwaiterGenaroMission,Jr.servedtwelve(12)setdinnerstothe

guests,andanother two (2)sets to theirguides freeofcharge (total of14sets ofdinner). Afterdinner, theguests

askedfortheirbill.SinceHiyaswasattendingtootherguests,hegaveasignaltoMissiontogivethebill.Mission

askedrespondentDualforthesalestransactionreceiptandpresentedthistotheguests.Theguestspaidtheamount

indicatedonthereceiptandthereafterleftinahurry. Thereceiptprintedat10:40p.m.showsthatonlyP3,036.00

wasremittedbycashierDualcorrespondingtosix(6)setsofdinner.Inviewofthediscrepancybetweentheorder

slipandthereceiptissued,petitionerMaribago,throughitsHumanResourceDevelopment(HRD)manager,issued

memoranda, requiring respondent Dual,AlvinHiyas, Ernesto Avenido and Basilio Alcoseba to explain why they

shouldnotbepenalizedforviolatingHouseRule4.1(dishonestyinanynature).

During the clarificatory hearing,

- butcherAlegradotestifiedthatwaiterAlcosebawenttothebutcherylookingfortheorderslipfortableno.113.Ataround9:45p.m.,waiterAlcosebacausedthealterationoftheordersliptoreflectthatsix(6)orders

were cancelled. Alegrado allegedly askedAlcoseba if thecook wasalreadyaware of thecancellation, to

which the latteranswered "oo,kahibawna" (yes,he isalreadyaware).Alcosebastated thathewasnot

privytothecancellationoforderssincehewasbusyattendingtohisroomserviceduty.

- Heclaimsthat - hesawthecancelledfoodordersatthewaiter'sstationbutinsiststhat - hedidnothaveanypartinthealterationoftheorderslip.Duringtheclarificatoryhearing,however,headmittedthathealtered

theorderslipbycancellingsix(6)setdinners.

- After the investigation, respondentDualwasfoundguiltyofdishonestyforhisfabricatedstatementsandforaskingoneofthewaiters(Mission)tocorroboratehisallegations.Hewasterminatedpermemorandum

dated22January2005.Alcosebawasalsoterminatedfordishonestybasedonhisadmissionthathealteredtheorderslip.

Dual filedacomplaint forunfair laborpractice, illegaldismissal,non-paymentof13thmonthandseparationpay,

anddamages.

The Labor Arbiter foundthatrespondent'sterminationwaswithoutvalidcauseandruledthatrespondentisentitled

toseparationpay; The NLRC setasidetheLaborArbiter'sdecisionanddismissedthecomplaint for lackofmerit,

saying that complainant's act of depriving respondent of its lawful revenue is tantamount to fraud against the

companywhichwarrantsdismissalfromtheservice. Falsificationofcommercialdocumentsasameanstomalverse

companyfundsconstitutesfraudagainstthecompany; The Court of Appeals reversedthedecisionandresolutionof

theNLRC.Findingnosufficientvalidcausetojustifyrespondent'sdismissal,theCourtofAppealsorderedpetitioner

topayrespondentfullbackwagesandseparationpay.

Petitioner places - thecruxofthecontroversy - ontheproventamperingofthetransactionreceiptwhichhappened

inrespondent'sworkstation.

Respondent,ontheotherhand,reiterateshisstorythattheorderslipwasalreadyalteredwhenMissiongaveitto

him;thathewasabletoconfirmthecancellationofsomeordersfromAlcosebaandHiyas;thatthereceiptheprinted

wasbasedontheorderslipforsix(6)setsofdinner;thatMissiongavehimP3,100.00aspaymentandhereturned

P64.00aschange.

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ISSUE:

Whetherornotthecourtofappealscommittedagraveandreversibleerrorinreversingthenationallaborrelations

commissionanddirectingpetitionertopayrespondentfullbackwagesfromthetimehewasillegallydismissed,up

tothefinalityof[its]decisionandseparationpayofonemonthsalaryforeveryyearofservice.

Inessence,theissueiswhether the Court of Appeals erred in ruling that respondent was illegally dismissed.

HELD:

The law requires that

anemployershallnotterminatetheservicesofanemployee

exceptforajustorauthorizedcause.

Otherwise,anemployeeunjustlydismissedfromworkisentitledtoreinstatementandfullbackwages.

Thelawalsorequires

- theemployer - toobservedueprocessinterminationcases. wIn Agabon v. National Labor Relations Commission,34cralaw

- weruledthat- violation of the employee's statutory right to due process makes the employer liable to payindemnity in the form of nominal damages. Thelawfurtherrequiresthatthe burden of proving the cause

for termination rests with the employer.cra35

In this case,

- weare inagreement thatpetitioner'sevidenceproved thatrespondent isguiltyof DISHONESTY andofstealingmoneyentrustedtohimascashier.

- InsteadofreportingP10,100.00aspaymentbytheguestsfortheirdinner,respondentcashieronlyreportedP3,036.00 as shownby the receipt which he admitted to have issued. The receipt whichbears his name

"NITO"wasprintedat"22:40" (10:40p.m.)or1hourand40minutesafter theguestshad leftat9:00p.m.

Twootherreceiptswereissuedforthesameamountat"22:39:55"and"22:40:01".

- Moreover,respondent'sclaim that - he receivedP3,100.00onlyandgaveMissionP64.00aschange isnotshownbythereceiptthatheissued.Theissuedreceiptdoesnotshowthatchangewasgiven.Inaddition,

theamountindicatedinthereceiptdoesnotcoincidewithDual'scontentionthatonlyfour(4)disheswere

cancelledandtwo(2)dishesweregivenfreeofcharge.

- Ifsuchwerethecase,thentheamountchargedtotheguestsshouldhavebeenforeight(8)setsofdinnerandnotsix(6)sets.Asestablishedduringtheclarificatoryhearing,twelve(12)setsofdinnerwereservedto

guests and two (2) dinnersets weregiven to the tour guides freeof charge. It is clearly indicated in the

alteredorderslipthatsix(6)outofthetwelve(12)setsofdinnerwerecancelled.

TheallegationofDualthat - six(6)dinnersetswereindeedcancelledasevidencedbythedishesheallegedlysawin

the utensil station is negatedby the testimonies of the kitchen staff (Chef Armand Galica, Butcher Alegrado and

Dessert-in-chargeJohnMarollano)thattwelve(12)setmealswereservedandconsumed.- These testimonies coincide with the claim of waiters Hiyas and Mission that fourteen (14) sets of dinner

wereserved.Theservingoffoodeliminatestheargumentofcancellation.

The alibi of cancellation has no leg to stand on.

- ThestandardoperatingprocedureofMaribagodictatesthatincasesofcancellation,theorderslip - hastobecountersignedbytheattendingwaiter(which inthiscaseshouldhavebeenChiefWaiterHiyas)butsuch

wasnotsointhiscase.

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The foregoing facts - explainwhyDualandAlcosebatriedtwicetoconvinceMissiontocoveruptheircrime.

- TheyevenaskedMissiontotakethefallbyaskinghimtoadmitthathealteredtheorderslipfromtwelve(12)setsofdinnertosix(6)sets.

Infine,whatisdamningtothecauseofDual - isthereceiptwhichheadmittedlyissued.Thereceiptwasissuedlong

aftertheguestshadleft(9:00p.m.)andafterthealterationoftheorderslip(9:45p.m.)wasdone.Suchfactledusto

theconclusionthat - he consented to and participated in the anomaly.

Respondent's acts constitute SERIOUS MISCONDUCT

- whichisajustcauseforterminationunderthelaw.- THEFT committedbyanemployeeisavalidreasonforhisdismissalbytheemployer.- Although as a rule this Court leans overbackwards to help workers and employees continue with their

employmentortomitigatethepenaltiesimposedonthem,

- ACTS OF DISHONESTY - in the handling of company property, petitioner's income in this case, are adifferentmatter.

Withal, the law, in protecting the rights of the laborers, authorizes neither oppression nor self-destruction of the

employer.WhiletheConstitutioniscommittedtothepolicyofsocialjusticeandtheprotectionoftheworkingclass,

itshouldnotbesupposedthateverylabordisputewillbeautomaticallydecidedinfavoroflabor.

- Themanagementalsohasitsownrights,assuch,areentitledtorespectandenforcementintheinterestofsimple fair play.Outof its concern for thosewith less privileges in life, theSupreme Courthas inclined

moreoftenthannot - towardtheworkerandupheldhiscause - inhisconflictswiththeemployer.

- Suchfavoritism,however,hasnotblindedtheCourttotherulethatjusticeisineverycaseforthedeserving,

tobedispensedinthelightoftheestablishedfactsandapplicablelawanddoctrine.