G.R. No.

177114

January 21, 2010

MANOLO A. PEAFLOR, Petitioner,

vs.
OUTDOOR CLOTHING MANUFACTURING CORPORATION, NATHANIEL T. SYFU, President,
MEDYLENE M. DEMOGENA, Finance Manager, and PAUL U. LEE, Chairman, Respondents.
BRION, J.;
Petitioner Manolo A. Peaflor (Peaflor) seeks the reversal of the Court of Appeals (CA) decision 1 dated
December 29, 2006 and its resolution2 dated March 14, 2007, through the present petition for review on
certiorari filed under Rule 45 of the Rules of Court. The assailed CA decision affirmed the September 24,
2002 decision3 of the National Labor Relations Commission (NLRC) that in turn reversed the August 15,
2001 decision4 of the Labor Arbiter.5
THE FACTUAL ANTECEDENTS
Peaflor was hired on September 2, 1999 as probationary Human Resource Department (HRD) Manager
of respondent Outdoor Clothing Manufacturing Corporation (Outdoor Clothing or the company). As HRD
head, Peaflor was expected to (1) secure and maintain the right quality and quantity of people needed
by the company; (2) maintain the harmonious relationship between the employees and management in a
role that supports organizational goals and individual aspirations; and (3) represent the company in labor
cases or proceedings. Two staff members were assigned to work with him to assist him in undertaking
these functions.
Peaflor claimed that his relationship with Outdoor Clothing went well during the first few months of his
employment; he designed and created the companys Policy Manual, Personnel Handbook, Job
Expectations, and Organizational Set-Up during this period. His woes began when the companys Vice
President for Operations, Edgar Lee (Lee), left the company after a big fight between Lee and Chief
Corporate Officer Nathaniel Syfu (Syfu). Because of his close association with Lee, Peaflor claimed that
he was among those who bore Syfus ire.
When Outdoor Clothing began undertaking its alleged downsizing program due to negative business
returns, Peaflor alleged that his department had been singled out. On the pretext of retrenchment,
Peaflors two staff members were dismissed, leaving him as the only member of Outdoor Clothings
HRD and compelling him to perform all personnel-related work. He worked as a one-man department,
carrying out all clerical, administrative and liaison work; he personally went to various government offices
to process the companys papers.
When an Outdoor Clothing employee, Lynn Padilla (Padilla), suffered injuries in a bombing incident, the
company required Peaflor to attend to her hospitalization needs; he had to work outside office premises
to undertake this task. As he was acting on the companys orders, Peaflor considered himself to be on
official business, but was surprised when the company deducted six days salary corresponding to the
time he assisted Padilla. According to Finance Manager Medylene Demogena (Demogena), he failed to
submit his trip ticket, but Peaflor belied this claim as a trip ticket was required only when a company
vehicle was used and he did not use any company vehicle when he attended to his off-premises work. 6

After Peaflor returned from his field work on March 13, 2000, his officemates informed him that while he
was away, Syfu had appointed Nathaniel Buenaobra (Buenaobra) as the new HRD Manager. This
information was confirmed by Syfus memorandum of March 10, 2000 to the entire office stating that
Buenaobra was the concurrent HRD and Accounting Manager.7 Peaflor was surprised by the news; he
also felt betrayed and discouraged. He tried to talk to Syfu to clarify the matter, but was unable to do so.
Peaflor claimed that under these circumstances, he had no option but to resign. He submitted a letter to
Syfu declaring his irrevocable resignation from his employment with Outdoor Clothing effective at the
close of office hours on March 15, 2000.8
Peaflor then filed a complaint for illegal dismissal with the labor arbiter, claiming that he had been
constructively dismissed. He included in his complaint a prayer for reinstatement and payment of
backwages, illegally deducted salaries, damages, attorneys fees, and other monetary claims.
Outdoor Clothing denied Peaflors allegation of constructive dismissal. It posited instead that Peaflor
had voluntarily resigned from his work. Contrary to Peaflors statement that he had been dismissed from
employment upon Syfus appointment of Buenaobra as the new HRD Manager on March 10, 2000,
Peaflor had in fact continued working for the company until his resignation on March 15, 2000. The
company cited as evidence the security report that Peaflor himself prepared and signed on March 13,
2000.9
Outdoor Clothing disclaimed liability for any of Peaflors monetary claims. Since Peaflor had voluntarily
resigned, Outdoor Clothing alleged that he was not entitled to any backwages and damages. The
company likewise denied making any illegal deduction from Peaflors salary; while deductions were
made, they were due to Peaflors failure to report for work during the dates the company questioned. As
a probationary employee, he was not yet entitled to any leave credit that would offset his absences.
In his August 15, 2001 decision, the labor arbiter found that Peaflor had been illegally
dismissed.10 Outdoor Clothing was consequently ordered to reinstate Peaflor to his former or to an
equivalent position, and to pay him his illegally deducted salary for six days, proportionate 13th month
pay, attorneys fees, moral and exemplary damages.
Outdoor Clothing appealed the labor arbiters decision with the NLRC. It insisted that Peaflor had not
been constructively dismissed, claiming that Peaflor tendered his resignation on March 1, 2000 because
he saw no future with the corporation due to its dire financial standing. Syfu alleged that he was
compelled to appoint Buenaobra as concurrent HRD Manager through a memorandum dated March 1,
2000 to cover the position that Peaflor would soon vacate. 11 The appointment was also made to address
the personnel matters that had to be taken cared of while Peaflor was on unauthorized leave.
Incidentally, Outdoor Clothing alleged that Peaflor had already been given two notices, on March 6 and
11, 2000 (absence without official leave memoranda or the AWOL memoranda), for his unauthorized
absences. In a memorandum dated March 3, 2000 addressed to Syfu, Buenaobra accepted the
appointment.12
Peaflor contested Syfus March 1, 2000 memorandum, Buenaobras March 3, 2000 memorandum, and
the AWOL memoranda, claiming these pieces of evidence were fabricated and were never presented
before the labor arbiter. He pointed out that nothing in this resignation letter indicated that it was
submitted to and received by Syfu on March 1, 2000. He claimed that it was submitted on March 15,
2000, the same date he made his resignation effective. The AWOL memoranda could not be relied on, as

he was never furnished copies of these. Moreover, he could not be on prolonged absence without official
leave, as his residence was just a few meters away from the office.
The NLRC apparently found Outdoor Clothings submitted memoranda sufficient to overturn the labor
arbiters decision.13 It characterized Peaflors resignation as a response, not to the allegedly degrading
and hostile treatment that he was subjected to by Syfu, but to Outdoor Clothings downward financial
spiral. Buenaobras appointment was made only after Peaflor had submitted his resignation letter, and
this was made to cover the vacancy Peaflors resignation would create. Thus, Peaflor was not eased
out from his position as HRD manager. No malice likewise was present in the companys decision to
dismiss Peaflors two staff members; the company simply exercised its management prerogative to
address the financial problems it faced. Peaflor, in fact, drafted the dismissal letters of his staff members.
In the absence of any illegal dismissal, no basis existed for the monetary awards the labor arbiter granted.
Peaflor anchored his certiorari petition with the CA on the claim that the NLRC decision was tainted with
grave abuse of discretion, although he essentially adopted the same arguments he presented before the
labor arbiter and the NLRC.
In a decision dated December 29, 2006,14 the CA affirmed the NLRCs decision, stating that Peaflor
failed to present sufficient evidence supporting his claim that he had been constructively dismissed. The
CA ruled that Peaflors resignation was knowingly and voluntarily made. Accordingly, it dismissed
Peaflors certiorari petition. It likewise denied the motion for reconsideration that Peaflor subsequently
filed.15 Faced with these CA actions, Peaflor filed with us the present petition for review on certiorari.
THE PARTIES ARGUMENTS
Peaflor insists that, contrary to the findings of the NLRC and the CA, he had been constructively
dismissed from his employment with Outdoor Clothing. He alleges that the dismissal of his two staff
members, the demeaning liaison work he had to perform as HRD Manager, the salary deduction for his
alleged unauthorized absences, and the appointment of Buenaobra as the new HRD manager even
before he tendered his resignation, were clear acts of discrimination that made his continued employment
with the Outdoor Clothing unbearable. He was thus forced to resign.
Outdoor Clothing claims that Peaflor voluntarily resigned from his work and his contrary allegations were
all unsubstantiated. The HRD was not singled out for retrenchment, but was simply the first to lose its staff
members because the company had to downsize. Thus, all HRD work had to be performed by Peaflor.
Instead of being grateful that he was not among those immediately dismissed due to the companys
retrenchment program, Peaflor unreasonably felt humiliated in performing work that logically fell under
his department; insisted on having a full staff complement; absented himself from work without official
leave; and demanded payment for his unauthorized absences.
THE ISSUE and THE COURTS RULING
The Court finds the petition meritorious.
A preliminary contentious issue is Outdoor Clothings argument that we should dismiss the petition
outright because it raises questions of facts, not the legal questions that should be raised in a Rule 45
petition.16

We see no merit in this argument as the rule that a Rule 45 petition deals only with legal issues is not an
absolute rule; it admits of exceptions. In the labor law setting, we wade into factual issues when conflict of
factual findings exists among the labor arbiter, the NLRC, and the CA. This is the exact situation that
obtains in the present case since the labor arbiter found facts supporting the conclusion that there had
been constructive dismissal, while the NLRCs and the CAs factual findings contradicted the labor
arbiters findings.17 Under this situation, the conflicting factual findings below are not binding on us, and
we retain the authority to pass on the evidence presented and draw conclusions therefrom. 18
The petition turns on the question of whether Peaflors undisputed resignation was a voluntary or a
forced one, in the latter case making it a constructive dismissal equivalent to an illegal dismissal. A critical
fact necessary in resolving this issue is whether Peaflor filed his letter of resignation before or after the
appointment of Buenaobra as the new/concurrent HRD manager. This question also gives rise to the side
issue of when Buenaobras appointment was made. If the resignation letter was submitted before Syfus
appointment of Buenaobra as new HRD manager, little support exists for Peaflors allegation that he had
been forced to resign due to the prevailing abusive and hostile working environment. Buenaobras
appointment would then be simply intended to cover the vacancy created by Peaflors resignation. On
the other hand, if the resignation letter was submitted after the appointment of Buenaobra, then factual
basis exists indicating that Peaflor had been constructively dismissed as his resignation was a response
to the unacceptable appointment of another person to a position he still occupied.
The question of when Peaflor submitted his resignation letter arises because this letter undisputably
made was undated. Despite Peaflors claim of having impressive intellectual and academic
credentials,19 his resignation letter, for some reason, was undated. Thus, the parties have directly
opposing claims on the matter. Peaflor claims that he wrote and filed the letter on the same date he
made his resignation effective March 15, 2000. Outdoor Clothing, on the other hand, contends that the
letter was submitted on March 1, 2000, for which reason Syfu issued a memorandum of the same date
appointing Buenaobra as the concurrent HRD manager; Syfus memorandum cited Peaflors intention to
resign so he could devote his time to teaching. The company further cites in support of its case
Buenaobras March 3, 2000 memorandum accepting his appointment. Another piece of evidence is the
Syfu memorandum of March 10, 2000, which informed the office of the appointment of Buenaobra as the
concurrent Head of HRD the position that Peaflor occupied. Two other memoranda are alleged to
exist, namely, the AWOL memoranda of March 6 and 11, 2000, allegedly sent to Penaflor.
Several reasons arising directly from these pieces of evidence lead us to conclude that Peaflor did
indeed submit his resignation letter on March, 15, 2000, i.e., on the same day that it was submitted.
First, we regard the Syfu memorandum of March 1, 2000 and the memorandum of Buenaobra of March 3,
2000 accepting the position of HRD Head to be highly suspect. In our view, these memoranda, while
dated, do not constitute conclusive evidence of their dates of preparation and communication.
Surprisingly, Peaflor was never informed about these memoranda when they directly concerned him,
particularly the turnover of responsibilities to Buenaobra if indeed Peaflor had resigned on March 1,
2000 and a smooth turnover to Buenaobra was intended. Even the recipients of these communications do
not appear to have signed for and dated their receipt. The AWOL memoranda, to be sure, should have
been presented with proof of service if they were to have any binding effect on Peaflor.
Second,we find it surprising that these pieces of evidence pointing to a March 1, 2000 resignation
specifically, Syfus March 1, 2000 memorandum to Buenaobra about Penaflors resignation and
Buenaobras own acknowledgment and acceptance were only presented to the NLRC on appeal, not

before the labor arbiter. The matter was not even mentioned in the companys position paper filed with the
labor arbiter.20 While the presentation of evidence at the NLRC level on appeal is not unheard of in labor
cases,21 still sufficient explanation must be adduced to explain why this irregular practice should be
allowed. In the present case, Outdoor Clothing totally failed to explain the reason for its omission. This
failure, to us, is significant, as these were the clinching pieces of evidence that allowed the NLRC to
justify the reversal of the labor arbiters decision.
Third, the circumstances and other evidence surrounding Peaflors resignation support his claim that he
was practically compelled to resign from the company.
Foremost among these is the memorandum of March 10, 2000 signed by Syfu informing the whole office
("To: All concerned") about the designation of Buenaobra as concurrent Accounting and HRD Manager. In
contrast with the suspect memoranda we discussed above, this memorandum properly bore signatures
acknowledging receipt and dates of receipt by at least five company officials, among them the readable
signature of Demogene and one Agbayani; three of them acknowledged receipt on March 13, 2000,
showing that indeed it was only on that day that the appointment of Buenaobra to the HRD position was
disclosed. This evidence is fully consistent with Peaflors position that it was only in the afternoon of
March 13, 2000 that he was told, informally at that, that Buenaobra had taken over his position. It explains
as well why as late as March 13, 2000, Peaflor still prepared and signed a security report, 22 and is fully
consistent with his position that on that day he was still working on the excuse letter of certain sales
personnel of the company.23
We note that the company only belatedly questioned the motivation that Peaflor cited for his
discriminatory treatment, i.e., that he was caught in the bitter fight between Syfu and Lee, then Vice
President for Operations, that led the latter to leave the company.24 After Lee left, Peaflor alleged that
those identified with Lee were singled out for adverse treatment, citing in this regard the downsizing of
HRD that occurred on or about this time and which resulted in his one-man HRD operation. We say this
downsizing was only "alleged" as the company totally failed despite Penaflors claim of discriminatory
practice to adduce evidence showing that there had indeed been a legitimate downsizing. Other than its
bare claim that it was facing severe financial problems, Outdoor Clothing never presented any evidence
to prove both the reasons for its alleged downsizing and the fact of such downsizing. No evidence was
ever offered to rebut Peaflors claim that his staff members were dismissed to make his life as HRD
Head difficult. To be sure, Peaflors participation in the termination of his staff members employment
cannot be used against him, as the termination of employment was a management decision that Peaflor,
at his level, could not have effectively contested without putting his own job on the line.
Peaflors own service with the company deserves close scrutiny. He started working for the company on
September 2, 1999 so that by March 1, 2000, his probationary period would have ended and he would
have become a regular employee. We find it highly unlikely that Peaflor would resign on March 1, 2000
and would then simply leave given his undisputed record of having successfully worked within his
probationary period on the companys Policy Manual, Personnel Handbook, Job Expectations, and
Organizational Set-up. It does not appear sound and logical to us that an employee would tender his
resignation on the very same day he was entitled by law to be considered a regular employee, especially
when a downsizing was taking place and he could have availed of its benefits if he would be separated
from the service as a regular employee. It was strange, too, that he would submit his resignation on
March 1, 2000 and keep completely quiet about this development until its effective date on March 15,
2000. In the usual course, the turnover alone of responsibilities and work loads to the successor in a
small company would have prevented the matter from being completely under wraps for 10 days before

any announcement was ever made. That Peaflor was caught by surprise by the turnover of his post to
Buenaobra is in fact indicated by the companys own evidence that Peaflor still submitted a security
report on March 13, 2000. On the whole, Peaflors record with the company is not that of a company
official who would simply and voluntarily tender a precipitate resignation on the excuse that he would
devote his time to teaching a lame excuse at best considering that March is the month the semester
usually ends and is two or three months away from the start of another school year.
In our view, it is more consistent with human experience that Peaflor indeed learned of the appointment
of Buenaobra only on March 13, 2000 and reacted to this development through his resignation letter after
realizing that he would only face hostility and frustration in his working environment. Three very basic
labor law principles support this conclusion and militate against the companys case.
The first is the settled rule that in employee termination disputes, the employer bears the burden of
proving that the employees dismissal was for just and valid cause. 25 That Peaflor did indeed file a letter
of resignation does not help the companys case as, other than the fact of resignation, the company must
still prove that the employee voluntarily resigned.26 There can be no valid resignation where the act was
made under compulsion or under circumstances approximating compulsion, such as when an employees
act of handing in his resignation was a reaction to circumstances leaving him no alternative but to
resign.27 In sum, the evidence does not support the existence of voluntariness in Peaflors resignation.1
a vv p h i 1
Another basic principle is that expressed in Article 4 of the Labor Code that all doubts in the
interpretation and implementation of the Labor Code should be interpreted in favor of the workingman.
This principle has been extended by jurisprudence to cover doubts in the evidence presented by the
employer and the employee.28 As shown above, Peaflor has, at very least, shown serious doubts about
the merits of the companys case, particularly in the appreciation of the clinching evidence on which the
NLRC and CA decisions were based. In such contest of evidence, the cited Article 4 compels us to rule in
Peaflors favor. Thus, we find that Peaflor was constructively dismissed given the hostile and
discriminatory working environment he found himself in, particularly evidenced by the escalating acts of
unfairness against him that culminated in the appointment of another HRD manager without any prior
notice to him. Where no less than the companys chief corporate officer was against him, Peaflor had no
alternative but to resign from his employment.29
Last but not the least, we have repeatedly given significance in abandonment and constructive dismissal
cases to the employees reaction to the termination of his employment and have asked the question: is
the complaint against the employer merely a convenient afterthought subsequent to an abandonment or a
voluntary resignation? We find from the records that Peaflor sought almost immediate official recourse to
contest his separation from service through a complaint for illegal dismissal. 30 This is not the act of one
who voluntarily resigned; his immediate complaints characterize him as one who deeply felt that he had
been wronged.
WHEREFORE, we GRANT the petitioners petition for review on certiorari, and REVERSE the decision
and resolution of the Court of Appeals in CA-G.R. SP No. 87865 promulgated on December 29, 2006 and
March 14, 2007, respectively. We REINSTATE the decision of the labor arbiter dated August 15, 2001,
with the MODIFICATION that, due to the strained relations between the parties, respondents are
additionally ordered to pay separation pay equivalent to the petitioners one months salary.
Costs against the respondents.

SO ORDERED.