1. Burden of proof to show dismissal for cause rest upon employer. It is a basic principle that in illegal dismissal cases, the burden of proof rests upon the employer to show that the dismissal of the employee is for a just cause and failure to do so would necessarily mean that the dismissal is not justified.

    Abandonment of work cannot be presumed from equivocal acts. In claims of abandonment by an employee, the settled rule is that the employer bears the burden of showing a deliberate and unjustified refusal by the employee to resume his employment without any intention of returning. In evaluating a charge of abandonment, the jurisprudential rule is that abandonment is a matter of intention that cannot be lightly presumed from equivocal acts.

    Elements of abandonment. To constitute abandonment, two elements must concur: (1) the failure to report for work or absence without valid or justifiable reason, and (2) a clear intent, manifested through overt acts, to sever the employer-employee relationship.

    Filing of complaint for illegal dismissal with prayer for reinstatement negates claim of abandonment. In a long line of cases, this Court has held that abandonment is negated where the immediate filing of a complaint for illegal dismissal was coupled with a prayer for reinstatement and that the filing of the complaint for illegal dismissal is proof enough of the desire to return to work. The prayer for reinstatement, as in this case, speaks against any intent to sever the employer-employee relationship.

    Award of attorney’s fees in action for recovery of wages or illegal dismissal. It is settled that in actions for recovery of wages or when the employee is illegally dismissed in bad faith or where an employee was forced to litigate and incur expenses to protect his rights and interests by reason of the unjustified acts of his employer, he is entitled to an award of attorney’s fees. (Baron Public Theatrical, et al. vs. Normita Peralta, et al., G.R. No. 170525, October 2, 2009.)

  2. Elements of valid retrenchment. In order for a retrenchment scheme to be valid, all of the following elements under Article 283 of the Labor Code must concur or be present, to wit:
    1. That retrenchment is reasonably necessary and likely to prevent business losses which, if already incurred, are not merely de minimis, but substantial, serious, actual and real, or if only expected, are reasonably imminent as perceived objectively and in good faith by the employer;
    2. That the employer served written notice both to the employees and to the DOLE at least one month prior to the intended date of retrenchment;
    3. That the employer pays the retrenched employees separation pay equivalent to one month pay or at least one-half month pay for every year of service, whichever is higher;
    4. That the employer exercises its prerogative to retrench employees in good faith for the advancement of its interest and not to defeat or circumvent the employees’ right to security of tenure; and,
    5. That the employer uses fair and reasonable criteria in ascertaining who would be dismissed and who would be retained among the employees, such as status, efficiency, seniority, physical fitness, age, and financial hardship for certain workers.

    In the absence of one element, the retrenchment scheme becomes an irregular exercise of management prerogative. The employer’s obligation to exhaust all other means to avoid further losses without retrenching its employees is a component of the first element as enumerated above. To impart operational meaning to the constitutional policy of providing full protection to labor, the employer’s 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. (FASAP vs. PAL, G.R. No. 178083, October 2, 2009.)

  3. Position of a cashier requires high degree of trust and confidence. A position of trust and confidence has been defined as one where a person is entrusted with confidence on delicate matters, or with the custody, handling, or care and protection of the employer’s property and/or funds. One such position is that of a cashier. A cashier is a highly sensitive position which requires absolute trust and honesty on the part of the employee.

    “Ample reason to distrust” sufficient basis to dismiss employee occupying position of trust and confidence. The rule, therefore, is that if there is sufficient evidence to show that the employee occupying a position of trust and confidence is guilty of a breach of trust, or that his employer has ample reason to distrust him, the labor tribunal cannot justly deny the employer the authority to dismiss such employee. (Eats-Cetera Food Services Outlet, et al. vs. Myrna B. Letran, et al., G.R. No. 179507, October 2, 2009.)

  4. Subcontractual employees directed to continue their duty after termination of contract become employee of the principal. With the conclusion that respondent [principal] directed petitioners [subcontractual employees] to remain at their posts and continue with their duties, it is clear that respondent exercised the power of control over them; thus, the existence of an employer-employee relationship. (Locsin, et al. vs. PLDT, G.R. No. 185251, October 2, 2009.)
  5. Mere absence of employee not sufficient to prove abandonment of work. “Mere absence of petitioner is not sufficient to establish the allegation of abandonment. The prolonged absence of petitioner was not without justifiable reason because it was established that her failure to report for work was due to the injury she suffered in the course of her employment and with sufficient notice to respondents. Petitioner also presented herself for work on the date stated in the medical certificate which stated that she is fit to resume work.”

    Burden of proof to show compliance with two notices requirement. In dismissing an employee, the employer has the burden of proving that the dismissed worker has been served two notices: (1) the first to inform the employee of the particular acts or omissions for which the employer seeks his dismissal, and (2) the second to inform the employee of his employer’s decision to terminate him.

    Ibid.; Where to serve notice in case of abandonment of work. In cases of abandonment of work, notice shall be served at the worker’s last known address. (Tong Yak Groceries vs. Concepcion Faeldonia, et al., G.R. No. 182499, October 2, 2009.)

  6. Nullification of a provision of CBA falls within the jurisdication of regular courts. The issue raised is whether Section 144, Part A of the PAL-FASAP CBA is unlawful and unconstitutional. Here, the petitioners’ primary relief is the annulment of Section 144, Part A of the PAL-FASAP CBA, which allegedly discriminates against them for being female flight attendants. Where the principal relief sought is to be resolved not by reference to the Labor Code or other labor relations statute or a collective bargaining agreement but by the general civil law, the jurisdiction over the dispute belongs to the regular courts of justice and not to the labor arbiter and the NLRC. In such situations, resolution of the dispute requires expertise, not in labor management relations nor in wage structures and other terms and conditions of employment, but rather in the application of the general civil law. Clearly, such claims fall outside the area of competence or expertise ordinarily ascribed to labor arbiters and the NLRC and the rationale for granting jurisdiction over such claims to these agencies disappears.

    Jurisdiction of labor tribunals limited to disputes arising from employer-employee relationship. Not every dispute between an employer and employee involves matters that only labor arbiters and the NLRC can resolve in the exercise of their adjudicatory or quasi-judicial powers. The jurisdiction of labor arbiters and the NLRC under Article 217 of the Labor Code is limited to disputes arising from an employer-employee relationship which can only be resolved by reference to the Labor Code, other labor statutes, or their collective bargaining agreement. [Citing Georg Grotjahn GMBH & Co. v. Isnani, G.R. No. 109272, August 10, 1994.]

    CBA not ordinary contract, but contract imbued with public interest. The relations between capital and labor are not merely contractual. They are so impressed with public interest that labor contracts must yield to the common good. The supremacy of the law over contracts is explained by the fact that labor contracts are not ordinary contracts; these are imbued with public interest and therefore are subject to the police power of the state. It should not be taken to mean that retirement provisions agreed upon in the CBA are absolutely beyond the ambit of judicial review and nullification. A CBA, as a labor contract, is not merely contractual in nature but impressed with public interest. If the retirement provisions in the CBA run contrary to law, public morals, or public policy, such provisions may very well be voided. [Halagueña, et al. vs. Philippine Airlines Inc., G.R. No. 172013, October 2, 2009.]

  7. Requirements to justify retrenchment. To justify retrenchment, the employer must prove serious business losses, and not just any kind or amount of loss. [The employer] should have produced its books of accounts, profit and loss statements, and even its accountant to competently amplify its financial position.

    Twin-notices requirement; Effect of failure to comply. The law requires that the employer must furnish the worker sought to be dismissed with two written notices before termination of employment can be legally effected: (1) notice which apprises the employee of the particular acts or omissions for which his dismissal is sought; and (2) the subsequent notice which informs the employee of the employer’s decision to dismiss him. Failure to comply with the requirements taints the dismissal with illegality. (Metro Construction, et al. vs. Rogelio Aman, G.R. No. 168324, October 12, 2009.)

  8. Fixing of retirement age. The age of retirement is primarily determined by the existing agreement or employment contract. In the absence of such agreement, the retirement age shall be fixed by law.

    Seafarers are contractual employees, not regular employees. Seafarers are considered contractual employees. They cannot be considered as regular employees under Article 280 of the Labor Code. Their employment is governed by the contracts they sign everytime they are rehired and their employment is terminated when the contract expires. Their employment is contractually fixed for a certain period of time. They fall under the exception of Article 280 whose employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season. (Citing Millares v. National Labor Relations Commission, 434 Phil. 524 [2002])

    Ibid.; Not entitled to separation pay. Seafarers’ employment automatically ceased upon the expiration of their contracts of enlistment (COE). Since there was no dismissal to speak of, it follows that they are not entitled to reinstatement or payment of separation pay or backwages, as provided by law. (Eastern Shipping Lines, Inc. vs. Ferrer, G.R. No. 171587, October 13, 2009, citing Millares, supra.)

  9. Unborn child qualifies as “dependent” for the purpose of bereavement leave and other death benefits. The CBA did not provide a qualification for the child dependent, such that the child must have been born or must have acquired civil personality. Without such qualification, then child shall be understood in its more general sense, which includes the unborn fetus in the mother’s womb.

    CBA provisions for the benefit of the employee must be liberally interpreted. Bereavement leave and other death benefits are granted to an employee to give aid to, and if possible, lessen the grief of, the said employee and his family who suffered the loss of a loved one. Being for the benefit of the employee, CBA provisions on bereavement leave and other death benefits should be interpreted liberally to give life to the intentions thereof. Time and again, the Labor Code is specific in enunciating that in case of doubt in the interpretation of any law or provision affecting labor, such should be interpreted in favor of labor. (Continental Steel Manufacturing Corp. vs. Montaño, et al., G.R. No. 182836, October 13, 2009.)

  10. Misappropriation of funds amounts to serious misconduct. An employee who fails to account for and deliver the funds entrusted to him is liable for misappropriating the same and is consequently guilty of serious misconduct. (Superlines Transportation Company vs. Pinera, G.R. No. 188742, October 13, 2009.)
  11. Strikers’ refusal to return to work for three years is a manifestation of intent to severe employment. “In petitioners’ case, despite the directive cum caveat of CASI for them to report back for work within two days from receipt thereof, they failed to comply therewith. After three years, as reflected above, they offered to return to work. Their intention to sever the employer-employee relationship with CASI is manifested, however, by the length of time they refused to return to work, for they had, in the interim, been looking for other jobs.” (Miguel A. Pilapil, et al. vs. National Labor Relations Commission, et al., G.R. No. 178229, October 23, 2009.)
  12. Failure to appeal the monetary awards does not bar its modification on appeal. “This Court notes that the NLRC awarded backwages, 13th month pay, and service incentive leave pay from July 10, 2005 to January 23, 2007 only. It is evident that these should not be limited to said period. These should be computed from the date of her illegal dismissal until this decision attains finality. Though Bolanos [the employee] did not appeal the computation of the NLRC’s award as affirmed by the Court of Appeals, we are not barred from ordering its modification. This Court is imbued with sufficient authority and discretion to review matters, not otherwise assigned as errors on appeal, if it finds that their consideration is necessary in arriving at a complete and just resolution of the case or to serve the interests of justice or to avoid dispensing piecemeal justice. Besides, substantive rights like the award of backwages, 13th month pay and service incentive leave pay resulting from illegal dismissal must not be prejudiced by a rigid and technical application of the rules. The computation of the award for backwages and other benefits from the time the compensation was withheld up to the time of actual reinstatement is a mere legal consequence of the finding that respondent was illegally dismissed by petitioners.” (Henlin Panay Company, et al. vs. NLRC, et al., G.R. No. 180718, October 23, 2009.)

Last Edited: Friday, August 19, 2011

Caveat: Subsequent court and administrative rulings, or changes to, or repeal of, laws, rules and regulations may have rendered the whole or part of this article inaccurate or obsolete.
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