Hacienda Primera Development Corporation v Villegas

Republic of the PhilippinesSupreme Court

Baguio City

SECOND DIVISION

HACIENDA PRIMERA DEVELOPMENTCORPORATION and ANNA KATRINA E.HERNANDEZ,

Petitioners,

- versus - MICHAEL S. VILLEGAS,

Respondent.

G.R. No. 186243 Present: CARPIO, J., Chairperson,NACHURA,PERALTA,ABAD, andMENDOZA, JJ. Promulgated: April 11, 2011

x------------------------------------------------------------------------------------x

RESOLUTION

NACHURA, J.:

This is a petition for review on certiorari under Rule 45 of the Rules of Court, seeking

the reversal of the Court of Appeals (CA) Decision[1]

dated November 27, 2008 and

Resolution[2]

dated February 3, 2009 in CA-G.R. SP No. 104847.

G.R. No. 186243 http://sc.judiciary.gov.ph/jurisprudence/2011/april2011/186243.htm

1 of 8 9/23/2013 11:21 PM

The facts of the case are as follows:

Petitioner Hacienda Primera Development Corporation (petitioner Hacienda) hired

respondent Michael S. Villegas as General Manager of Amorita Resort. He was hired as a

probationary employee for three (3) months. The employment contract contained the following

terms and conditions:

1. Salary of P60,000.00 net per month for the first three (3) months and upon his

regularization, P70,000.00 net per month.2. Six (6) round trip tickets (TAG-MLA-TAG) per annum.3. P2,500.00 cell phone bill allowance.4. Fifteen (15) days vacation leave and fifteen (15) days sick leave upon permanency.

5. Pro-rated 13th month pay starting December 2006.6. A 3-month probationary period starting January 200[7].7. Board and lodging in the resort.

8. Medical Insurance.[3]

Respondent started working for petitioner on January 1, 2007. On March 14, 2007, he

received a call from Paramount Consultancy and Management telling him to report back to

Manila. There, he learned that his services were terminated. He, thus, asked for a written notice

of termination, but did not receive any.[4]

Hence, the complaint for illegal dismissal.

Petitioner Hacienda, on the other hand, stated that respondent was hired as probationary

employee. It explained that respondent’s services were terminated because he failed to qualify

for regular employment. Specifically, it claimed that respondent failed to conceptualize and

complete financial budgets, sales projection, room rates, website development, and marketing

plan in coordination with the Sales and Marketing Manager.[5]

On November 22, 2007, Labor Arbiter (LA) Herminio V. Suelo rendered a decision[6]

in

favor of respondent, the dispositive portion of which reads:

WHEREFORE, premises considered, judgment is hereby rendered finding complainantillegally dismissed. Accordingly, respondents are hereby ordered as follows:

1. To reinstate complainant to his former position without loss of seniority rights and

other benefits;


2 of 8 9/23/2013 11:21 PM

2. To pay complainant his backwages from the time he was dismissed on March 15,2007, until his actual reinstatement either physically or by payroll;

3. To pay complainant moral damages in the amount of Fifty Thousand Pesos

(P50,000.00), and exemplary damages also in the amount of Fifty Thousand Pesos(P50,000.00);

4. To pay complainant attorney’s fees equivalent to ten (10) percent of the total

monetary award.

The reinstatement aspect of this Decision is immediately executory pursuant to Article223 of the Labor Code, as amended. Respondents are therefore directed to submit a report ofcompliance thereof before this Office within ten (10) calendar days from receipt of thisDecision.

The Fiscal Examiner or the computation and examination unit of this Office is directedto compute the monetary aspect of the above-judgment awards which shall form part of thisDecision.

SO ORDERED.[7]

Aggrieved, petitioner Hacienda elevated the case to the National Labor Relations

Commission (NLRC), which partially granted[8]

the appeal, worded in this wise:

WHEREFORE, the foregoing premises considered, the instant appeal is PARTIALLY

GRANTED. The charge of illegal dismissal is DISMISSED for lack of merit.Accordingly, the Decision is MODIFIED to order the respondents-appellants to pay

his salary corresponding to the unexpired portion of his contract of employment (March16-31, 2007) in the amount of P30,000.00.

SO ORDERED.[9]

In a Decision[10]

dated November 27, 2008, the CA set aside the above NLRC decision

and reinstated that of the LA. The dispositive portion of the assailed CA Decision is quoted

below for easy reference:

WHEREFORE, the instant Petition is hereby GRANTED. The Decision of the

NLRC is hereby SET ASIDE. Accordingly, the Decision of the Labor Arbiter isREINSTATED with the MODIFICATION that since reinstatement is no longer possible dueto strained relations between the parties, a separation pay of one month for every year ofservice is hereby decreed. In this connection, the instant case is hereby remanded to the LaborArbiter for the computation of the said monetary award.

SO ORDERED.[11]


3 of 8 9/23/2013 11:21 PM

Petitioner Hacienda’s motion for reconsideration was denied in a Resolution[12]

dated

February 3, 2009. Hence, the instant petition with the following assigned errors:

(A) THE COURT OF APPEALS COMMITTED A SERIOUS ERROR OF

JUDGMENT WHEN IT RULED THAT RESPONDENT WAS ILLEGALLY DISMISSED; (B) THE COURT OF APPEALS COMMITTED A SERIOUS ERROR OF

JUDGMENT IN REINSTATING THE DECISION OF THE LABOR ARBITER AWARDINGUNLIMITED BACKWAGES BEYOND THE RESPONDENT’S PROBATIONARYEMPLOYMENT;

(C) THE COURT OF APPEALS COMMITTED A SERIOUS ERROR OF

JUDGMENT WHEN IT RULED THAT RESPONDENT IS ENTITLED TO MORAL ANDEXEMPLARY DAMAGES;

(D) THE COURT OF APPEALS COMMITTED A SERIOUS ERROR OF

JUDGMENT WHEN IT RULED THAT RESPONDENT IS ENTITLED TO ATTORNEY’SFEES;

(E) THE COURT OF APPEALS COMMITTED A SERIOUS ERROR OF

JUDGMENT WHEN IT ORDERED THE PAYMENT OF SEPARATION PAY; AND (F) THE COURT OF APPEALS COMMITTED A SERIOUS ERROR OF

JUDGMENT WHEN IT DECIDED THE PETITION OF RESPONDENT ALTHOUGH THENLRC’S RSOLUTION DATED 22 APRIL 2008 IS ALREADY FINAL AND EXECUTORYSINCE RESPONDENT’S MOTION FOR RECONSIDERATION, CONTRARY TO THE

RULES OF PROCEDURE OF THE NLRC, IS UNVERIFIED.[13]

The petition is unmeritorious.

The Labor Code and its Implementing Rules govern probationary employment.[14]

LABOR CODE

Art. 281. Probationary Employment.—Probationary employment shall not exceed six(6) months from the date the employee started working, unless it is covered by anapprenticeship agreement stipulating a longer period. The services of an employee who hasbeen engaged on a probationary basis may be terminated for a just cause or when he fails toqualify as a regular employee in accordance with reasonable standards made known by theemployer to the employee at the time of his engagement. An employee who is allowed to workafter a probationary period shall be considered a regular employee.

LABOR CODE, Implementing Rules of Book VI, Rule I, Section 6 Sec. 6. Probationary employment. There is probationary employment where the

employee, upon his engagement, is made to undergo a trial period during which the employerdetermines his fitness to qualify for regular employment, based on reasonable standards madeknown to him at the time of engagement.


4 of 8 9/23/2013 11:21 PM

Probationary employment shall be governed by the following rules: x x x x (c) The services of an employee who has been engaged on probationary basis may be

terminated only for a just or authorized cause, when he fails to qualify as a regular employeein accordance with the reasonable standards prescribed by the employer.

(d) In all cases of probationary employment, the employer shall make known to the

employee the standards under which he will qualify as a regular employee at the time of hisengagement. Where no standards are made known to the employee at that time, he shall bedeemed a regular employee.

In Magis Young Achievers’ Learning Center v. Manalo,[15]

the Court described

probationary employment in this wise:

A probationary employee or probationer is one who is on trial for an employer, during

which the latter determines whether or not he is qualified for permanent employment. Theprobationary employment is intended to afford the employer an opportunity to observe thefitness of a probationary employee while at work, and to ascertain whether he will become anefficient and productive employee. While the employer observes the fitness, propriety andefficiency of a probationer to ascertain whether he is qualified for permanent employment, theprobationer, on the other hand, seeks to prove to the employer that he has the qualifications tomeet the reasonable standards for permanent employment. Thus, the word probationary, asused to describe the period of employment, implies the purpose of the term or period, not its

length.[16]

It can be gleaned from the foregoing provisions of law and jurisprudential

pronouncement that there are two grounds to legally terminate a probationary employee. It may

be done either: a) for a just cause; or b) when the employee fails to qualify as a regular

employee in accordance with reasonable standards made known by the employer to the

employee at the start of the employment.[17]

In this case, petitioner Hacienda fails to specify the reasonable standards by which

respondent’s alleged poor performance was evaluated, much less to prove that such standards

were made known to him at the start of his employment.[18]

Thus, he is deemed to have been

hired from day one as a regular employee.[19]

Due process dictates that an employee be

apprised beforehand of the condition of his employment and of the terms of advancement


5 of 8 9/23/2013 11:21 PM

therein.[20]

We quote with approval the CA’s observation in this wise:

Verily, a cursory examination of the employment contract readily shows the absence ofany standard to which [respondent] should comply. Neither was there any indicia that[respondent] was ever informed of the said standards if there [were] any. What [petitioners]merely claim, as mentioned above, is that [respondent] was presumed to know the standard

required of him as General Manager in charge [of] the pre-opening of the resort.[21]

In Secon Philippines, Ltd. v. NLRC,[22]

Orient Express Placement Phils. v. NLRC,[23]

and Davao Contractors Development Cooperative (DACODECO) v. Pasawa,[24]

we did not

sustain the employees’ dismissal for failure of the employer to apprise them of the reasonable

standards they needed to comply with for their continued employment.

We find no reason to depart from the above conclusion.

WHEREFORE, premises considered, the petition is DENIED. The Court of Appeals

Decision dated November 27, 2008 and Resolution dated February 3, 2009 in CA-G.R. SP

No. 104847 are AFFIRMED.

SO ORDERED.

ANTONIO EDUARDO B. NACHURA Associate Justice

WE CONCUR:

ANTONIO T. CARPIOAssociate Justice

Chairperson

DIOSDADO M. PERALTAAssociate Justice

ROBERTO A. ABADAssociate Justice


6 of 8 9/23/2013 11:21 PM

JOSE CATRAL MENDOZAAssociate Justice

A T T E S T A T I O N

I attest that the conclusions in the above Resolution had been reached in consultationbefore the case was assigned to the writer of the opinion of the Court’s Division.

ANTONIO T. CARPIO Associate Justice

Chairperson, Second Division

C E R T I F I C A T I O N

Pursuant to Section 13, Article VIII of the Constitution and the Division Chairperson'sAttestation, I certify that the conclusions in the above Resolution had been reached inconsultation before the case was assigned to the writer of the opinion of the Court’s Division.

RENATO C. CORONA Chief Justice

[1] Penned by Associate Justice Myrna Dimaranan Vidal, with Associate Justices Jose L. Sabio, Jr. and Jose C. Reyes, Jr.,

concurring; rollo, pp. 44-57.[2]

Id. at 59.[3]

Supra note 1, at 45.[4]

Id. at 45-46.[5]

Id. at 158.[6]

Id. at 124-132.[7]

Id. at 131-132.[8]

Id. at 154-159.[9]

Id. at 159.[10]

Supra note 1.[11]

Id. at 56-57.[12]

Supra note 2.[13]

Rollo, p. 21.


7 of 8 9/23/2013 11:21 PM

[14] Ramos v. Court of Appeals, G.R. No. 170116, December 23, 2008, 575 SCRA 160, 167.

[15] G.R. No. 178835, February 13, 2009, 579 SCRA 421.

[16] Id. at 431-432.

[17] Aberdeen Court, Inc. v. Agustin, Jr., 495 Phil. 706, 715 (2005).

[18] Orient Express Placement Phils. v. NLRC, 339 Phil. 449, 452 (1997).

[19] Clarion Printing House, Inc. v. NLRC, 500 Phil. 61, 82 (2005).

[20] Orient Express Placement Phils. v. NLRC, supra, at 453.

[21] Supra note 1, at 51.

[22] 377 Phil. 711 (1999).

[23] Supra.

[24] G.R. No. 172174, July 9, 2009, 592 SCRA 334.


8 of 8 9/23/2013 11:21 PM

Hacienda Primera Development Corporation v Villegas

Documents

Transcript of Hacienda Primera Development Corporation v Villegas