085 Babas v. Lorenzo Shipping, G.R. No.

186091, December 15, 2010

Facts:
Petitioners were hired by BMSI in order to perform the service agreement it entered
into with LSC. LSC terminated the Agreement; consequently, petitioners lost their
employment. LSC averred that petitioners were employees of BMSI and were
assigned to LSC by virtue of the Agreement. BMSI is an independent job contractor
with substantial capital or investment in the form of tools, equipment, and
machinery necessary in the conduct of its business. The Agreement between LSC
and BMSI constituted legitimate job contracting. Thus, petitioners were employees
of BMSI and not of LSC.

Issue:
Whether or not BMSI is an independent contractor, thus liable to the employees.

Held:
NO. It is only a labor-only contractor. There was absolute lack of evidence that BMSI
exercised control over them or their work. LSC was unable to present proof that
BMSI had substantial capital. BMSI performed activities, which were directly
related to the main business of LSC. BMSI also had no other client except for LSC,
and neither BMSI nor LSC refuted this finding, thereby bolstering the NLRC finding
that BMSI is a labor-only contractor. The character of the business, i.e., whether as
labor-only contractor or as job contractor, should be measured in terms of, and
determined by, the criteria set by statute. The parties cannot dictate by the mere
expedience of a unilateral declaration in a contract the character of their business.

86 Oregas v. NLRC, G.R. No. 166757, July 21, 2008, 559 SCRA 153
Facts:
Petitioners worked as valet parking attendants and door attendants in respondent
Dusit Hotel Nikko (Dusit). As evidence of their employment, they have employment
contracts with respondent FVA. Sometime in 2000, FVA recalled petitioners from
Dusit. Petitioners then instituted a complaint for illegal dismissal, regularization,
premium pay for holiday and rest day, holiday pay, service incentive leave pay, 13th
month pay and attorneys fees against respondents Dusit, Philippine Hoteliers,
Inc., (in its capacity as managing company of Dusit) and FVA. Dusit denied its
liability and contended that it is FVA that should be held liable since it was engaged
as independent contractor.

Issue:
Whether FVA is an independent contractor, thus liable to the employees.

Held:
Yes. FVA was a legitimate job contractor. Among the circumstances that established
the status of FVA as a legitimate job contractor are: (1) FVA is registered with the
DOLE and the DTI (2) FVA has a Contract for Services with Dusit for the supply of
Commission parking and door attendant services 3) FVA has an independent
business and provides valet parking and door attendant services to other clients like
Mandarin Oriental, Manila Hotel, Peninsula Manila Hotel, Westin Philippine Plaza,
Golden B Hotel, Pan Pacific Manila Hotel, and Strikezone Bowling Lane and (4)
FVAs total assets from 1997 to 1999 amount to P1,502,597.70 to P9,021,335.13. 13.
In addition, it provides the uniforms and lockers of its employees.

087 Begino v. ABS-CBN, G.R. No. 199166, April 20, 2015

Facts:
Respondents thru Talent Contracts, which expressly provides that they are not
under control of the respondent and that they are free to use their time according to
their wills, hired petitioners. Petitioners were tasked with coverage of news items
for subsequent daily airings in respondents TV Patrol Bicol Program. After years of
service, petitioners filed for regularization but the respondents refused on the
ground that they are independent contractor. Given the unpredictability of viewer
preferences, respondents argued that the company cannot afford to provide regular
work for talents with whom it negotiates specific or determinable professional fees
on a per project, weekly or daily basis, usually depending on the budget allocation
for a project.

Issue:
Whether petitioners are regular employees or independent contractors.

Held:
Regular employees. The presumption is that when the work done is an integral part
of the regular business of the employer and when the worker, relative to the
employer, does not furnish an independent business or professional service, such
work is a regular employment of such employee and not an independent contractor.
Rather than the project and/or independent contractors respondents claim them to
be, it is evident from the foregoing disquisition that petitioners are regular
employees of ABS-CBN. This conclusion is borne out by the ineluctable showing that
petitioners perform functions necessary and essential to the business of ABS-CBN,
which repeatedly employed them for a long-running news program of its Regional
Network Group in Naga City. In the course of said employment, petitioners were
provided the equipment they needed, were required to comply with the Company's
policies which entailed prior approval and evaluation of their performance.

088 Bernarte v. Phil. Basketball Asso., G.R. No. 192084, September 14, 2011
Facts:
Petitioners were referees of PBA and were made to contracts on a year-to-year
basis. During the term of Commissioner Eala, however, changes were made on the
terms of their employment. Petitioners contract was not renewed. Feeling
aggrieved, they filed for illegal dismissal alleging that they are already regular
employees after they had served as referees for more than a year as evidenced by
repeated execution of contracts.

Issue:
Whether the repeated renewal of contract constituted petitioners as regular
employees.

Held:
NO. The fact that PBA repeatedly hired petitioner does not by itself prove that
petitioner is an employee of the former. For a hired party to be considered an
employee, the hiring party must have control over the means and methods by which
the hired party is to perform his work, which is absent in this case. The continuous
rehiring by PBA of petitioner simply signifies the renewal of the contract between
PBA and petitioner, and highlights the satisfactory services rendered by petitioner
warranting such contract renewal. Conversely, if PBA decides to discontinue
petitioners services at the end of the term fixed in the contract, whether for
unsatisfactory services, or violation of the terms and conditions of the contract, or
for whatever other reason, the same merely results in the non-renewal of the
contract, as in the present case. The non-renewal of the contract between the parties
does not constitute illegal dismissal of petitioner by respondents.

89 Fonterra Brands v. Largado, G.R. No. 205300, March 18, 2015

Facts:
Petitioner contracted the services of Zytron Marketing and Promotions Corp. for the
marketing and promotion of its milk and dairy products. Upon termination of the
said contract, petitioner then entered into an agreement for manpower supply with
A.C. Sicat Marketing and Promotional Services (ACSMPS). Respondents were
project-based employees of ACSMPS whose contracts were not renewed after the
lapse of 5 months. Aggrieved, respondents filed for illegal dismissal against
petitioner and ACSMPS.

Issue:
Whether respondents were illegally dismissed for non-renewal of their contracts.

Held:
No. Respondents were fixed-term employees. The determining factor of such
contracts is not the duty of the employee but the day certain agreed upon by the
parties for the commencement and termination of the employment relationship.
Respondents, by accepting the conditions of the contract with A.C. Sicat, were well
aware of and even acceded to the condition that their employment thereat will end
on said pre-determined date of termination. They cannot now argue that the latter
illegally dismissed them when it refused to renew their contracts after its
expiration. This is so since the non-renewal of their contracts by A.C. Sicat is a
management prerogative, and failure of respondents to prove that such was done in
bad faith militates against their contention that they were illegally dismissed. The
expiration of their contract with A.C. Sicat simply caused the natural cessation of
their fixed-term employment there at. We, thus, see no reason to disturb the ruling
of the CA in this respect.

90 Omni Hauling v. Bon, G.R. No. 199388, September 3, 2014

Facts:
Petitioner was awarded a one (1) year service contract by the local government of
Quezon City to provide garbage-hauling services. For this purpose, Omni hired
respondents as garbage truck drivers and paleros who were then paid on a per trip
basis. Upon renewal of the contract petitioner required each of the respondents to
sign employment contracts which provided that they will be re-hired only for the
duration of the same period. However, respondents refused to sign the employment
contracts, claiming that they were regular employees since they were engaged to
perform activities, which were necessary and desirable to Omnis usual business or
trade. Thus, Omni terminated the employment of respondents, which, in turn,
resulted in the filing of cases for illegal dismissal.

Issue:
Whether respondents were only project employees.

Held:
No. They are regular employees. According to jurisprudence, the principal test for
determining whether particular employees are properly characterized as project
employees as distinguished from regular employees, is whether or not the
employees were assigned to carry out a specific project or undertaking, the
duration (and scope) of which were specified at the time they were engaged for that
project. The project could either be (1) a particular job or undertaking that is within
the regular or usual business of the employer company, but which is distinct and
separate, and identifiable as such, from the other undertakings of the company; or
(2) a particular job or undertaking that is not within the regular business of the
corporation. In order to safeguard the rights of workers against the arbitrary use of
the word project to prevent employees from attaining a regular status, employers
claiming that their workers are project employees should not only prove that the
duration and scope of the employment was specified at the time they were engaged,
but also that there was indeed a project. Petitioner failed to comply the said
requirements.

91 Hacienda Leddy v. Villegas, G.R. No. 179654, September 22, 2014

Facts:
Villegas is an employee at the Hacienda Leddy as early as 1960, when it was still
named Hacienda Teresa. Gamboa, one of the successors of the property, went to
Villegas' house and told him that his services were no longer needed without prior
notice or valid reason. Hence, Villegas filed the instant complaint for illegal dismissal
alleging that she was not given due process, and as employee who worked for more
than 20 years, she is a regular employee entitled to it.

Issue:
Whether the respondent Villegas is a regular employee.

Held:
Yes. Owing to the length of service alone, he became a regular employee, by
operation of law, 1 year after he was employed. Clearly, with more than 20 years of
service, Villegas, without doubt, passed the test to attain employment regularity.
The test to determine whether employment is regular or not is the reasonable
connection between the particular activity performed by the employee in relation to
the usual business or trade of the employer. If the employee has been performing
the job for at least one year, even if the performance is not continuous or merely
intermittent, the law deems the repeated and continuing need for its performance as
sufficient evidence of the necessity, if not indispensability of that activity to the
business.

92 FVR Skills and Services v. Seva, G.R. No. 200857, October 22, 2014
Facts:
Respondent Jovert R. Seva and 27 others were employed by petitioner FVR Skills
and Services Exponents, Inc., an independent contractor engaged in the business of
providing janitorial and other manpower services to clients. As early as 1998 some
of the respondents had already been under the petitioners employ. Petitioner
entered into a contract with Robinsons Land Corporation (Robinsons). The contract
was not renewed thus respondents were terminated as the petitioner considered
them as project employees. Respondents filed a complaint for illegal dismissal
arguing that they were not project but regular employees who may only be
dismissed for just or authorized causes. Does their complaint find merit?

Issue:
Whether the respondents are regular employees.

Held:
Yes. SEVA et al. are considered regular employees of SKILLEX as they have been
doing work that is necessary and desirable to the latters business of providing
janitorial and manpower services. Additionally, the contract they signed was
belatedly done and does not affect their status as regular employees. For an
employee to be validly categorized as a project employee, it is necessary that the
specific project or undertaking had been identified and its period and completion
date determined and made known to the employee at the time of his engagement.
There are two kinds of regular employees, namely: (a) those who were engaged to
perform activities which are usually necessary or desirable in the usual business or
trade of the employer; and (2) those casual employees who became regular after
one year of service, whether continuous or broken, but only with respect to the
activity for which they have been hired.

93 Manalo v. TSN Philippines, G.R. No. 208567, November 26, 2014

Facts:
Respondent is engaged as a market research facility. It hired several field personnel,
including petitioners, on a project-to-project basis whose functions were to obtain
data. They were also assigned office-based tasks for which they were required to be
in the office from 9 a.m. to 6 p.m. These office-based tasks were not on a per project
basis and petitioners did not sign any contract for these jobs. Neither was these
assignments reported to the Dole. Due to some changes in the company, petitioners
filed a consolidated complaint for regularization before the Labor Arbiter. LA
dismissed the case on the ground that they are merely project employees despite
repeated renewal of their contracts.

Issue:
Whether petitioners are regular employees of TNS.

Held:
Although it is true that the length of time of the employees service is not a
controlling determinant of project employment, it is vital in determining whether he
was hired for a specific undertaking or in fact tasked to perform functions vital,
necessary and indispensable to the usual business or trade of the employer. Once a
project or work pool employee has been: (1) continuously, as opposed to
intermittently, rehired by the same employer for the same tasks or nature of tasks;
and (2) these tasks are vital, necessary and indispensable to the usual business or
trade of the employer, then the employee must be deemed a regular employee. The
project employment scheme used by TNS easily circumvented the law and
precluded its employees from attaining regular employment status in the subtlest
way possible. Petitioners were rehired not intermittently, but continuously, contract
after contract, month after month, involving the very same tasks. They practically
performed exactly the same functions over several years. Ultimately, without a
doubt, the functions they performed were indeed vital and necessary to the very
business or trade of TNS.

94 Basan v. Coca-Cola Bottlers, G.R. Nos. 174365-66, February 4, 2015

Facts:
Petitioners filed a complaint for illegal dismissal with money claims against
respondent Coca-Cola Bottlers Philippines, alleging that respondent dismissed them
without just cause and prior written notice required by law. Respondent
corporation, however, countered that it hired petitioners as temporary route
helpers to act as substitutes for its absent regular route helpers merely for a fixed
period in anticipation of the high volume of work in its plants or sales offices. As
such, petitioners claims have no basis for they knew that their assignment as route
helpers was temporary in duration.

Issue:
Whether petitioners are regular employees of Respondent Coco-Cola Bottlers.

Held:
Yes. Pursuant to Article 280 of the Labor Code, there are two kinds of regular
employees, namely: (1) those who are engaged to perform activities which are
usually necessary or desirable in the usual business or trade of the employer; and
(2) those who have rendered at least one year of service, whether continuous or
broken, with respect to the activities in which they are employed. Simply stated,
regular employees are classified into: (1) regular employees by nature of work; and
(2) regular employees by years of service. The former refers to those employees
who perform a particular activity which is necessary or desirable in the usual
business or trade of the employer, regardless of their length of service; while the
latter refers to those employees who have been performing the job, regardless of the
nature thereof, for at least a year. Petitioners, in this case, fall under the first kind of
regular employee above. As route helpers who are engaged in the service of loading
and unloading soft drink products of respondent company to its various delivery
points, which is necessary or desirable in its usual business or trade, petitioners are
considered as regular employees. That they merely rendered services for periods of
less than a year is of no moment since for as long as they were performing activities
necessary to the business of respondent, they are deemed as regular employees
under the Labor Code, irrespective of the length of their service.

95 Hacienda Cataywa v. Lorezo, G.R. No. 179640, March 18, 2015

Facts:
Respondent alleged that she was a laborer of the petitioner since 1970 and that the
latter failed to pay he SSS when she tried to make a loan. Thus, believing that she is a
regular employee, she wanted petitioner to pay all her SSS deficiency payments.
Petitioner, however, refused to do so.

Issue:
Whether respondent is a regular employee thus, the petitioner is liable for SSS
deficiency.

Held:
Yes. Jurisprudence has identified the three types of employees: (1) regular
employees or those who have been engaged to perform activities that are usually
necessary or desirable in the usual business or trade of the employer; (2) project
employees or those whose employment has been fixed for a specific project or
undertaking, the completion or termination of which has been determined at the
time of their engagement, or those whose work or service is seasonal in nature and
is performed for the duration of the season; and (3) casual employees or those who
are neither regular nor project employees.

Farm workers generally fall under the definition of seasonal employees.2It was also
consistently held that seasonal employees might be considered as regular
employees when they are called to work from time to time. They are in regular
employment because of the nature of the job, and not because of the length of time
they have worked. However, seasonal workers who have worked for one season
only may not be considered regular employees.

The nature of the services performed and not the duration thereof is determinative
of coverage under the law. To be exempted on the basis of casual employment, the
services must not merely be irregular, temporary or intermittent, but the same must
not also be in connection with the business or occupation of the employer. Thus, it is
erroneous for the petitioners to conclude that the respondent was a very casual
worker simply because the SSS form revealed that she had 16 months of
contributions. It does not, in any way, prove that the respondent performed a job,
which is not in connection with the business or occupation of the employer to be
considered as casual employee.

96 Paz v. Northern Tobacco Redrying, G.R. No. 199554, Feb. 18, 2015
Facts:
NTRCI hired Zenaida Paz (Paz) sometime in 1974 as a seasonal sorter, paid P185.00
daily. NTRCI regularly re-hired her every tobacco season since then. She signed a
seasonal job contract at the start of her employment and a pro-forma application
letter prepared by NTRCI in order to qualify for the next season. When Paz was 63
years old, NTRCI informed her that she was considered retired under company
policy. A year later, NTRCI told her she would receive P12,000.00 as retirement pay.
Feeling aggrieved, Paz filed for illegal dismissal and claimed for other benefits other
that retirement benefits since she is a regular employee.

Issue:
Whether petitioner Paz is a regular employee despite his seasonal contract.

Held:
Regular. Having performed the same tasks for petitioners every season for several
years, are considered the latters regular employees for their respective tasks. While
it may appear that the work of petitioner is seasonal, inasmuch as petitioner have
served the company for many years, some for over 20 years, performing services
necessary and indispensable to respondents business, serve as badges of regular
employment. Moreover, the fact that petitioners do not work continuously for one
whole year but only for the duration of the tobacco season does not detract from
considering them in regular employment since in a litany of cases this Court has
already settled that seasonal workers who are called to work from time to time and
are temporarily laid off during off-season are not separated from service in said
period, but are merely considered on leave until re-employed. The services of Paz
performed as a sorter were necessary and indispensable to respondent

97 Dela Cruz v. Maersk Filipinas Crewing, Inc., 551 SCRA 284

Facts:
Respondent Elite Shipping A.S. hired petitioner Dante D. de la Cruz as third engineer
for the vessel M/S Arktis Morning through its local agency in the Philippines, co-
respondent Maersk Filipinas Crewing Inc. The contract of employment was for a
period of nine months. He was deployed but was subsequently terminated because
he was allegedly incompetent and not fit to the hired position. Petitioner thereafter
filed a complaint for illegal dismissal with claims for the monetary equivalent of the
unexpired portion of his contract, damages and attorney's fees before NLRC.

Issue:
Whether petitioner as a migrant worker, is a regular employee.
Held:
No. Migrant workers are only contractual employees and can never be considered
regular employees. It is an accepted maritime industry practice that the
employment of seafarers is for a fixed period only. The Court acknowledges this to
be for the mutual interest of both the seafarer and the employer. Seafarers cannot
stay for a long and indefinite period of time at sea as limited access to shore activity
during their employment has been shown to adversely affect them. Furthermore,
the diversity in nationality, culture and language among the crew necessitates the
limitation of the period of employment.

98 Gadia v. Sykes Asia, G.R. No. 209499, January 28, 2015

Facts:
Respondentt Sykes Asia is engaged in Business Process Outsourcing (BPO). It
entered contract with Alltel Communications, Inc. (Alltel to accommodate the needs
and demands of Alltel clients for its postpaid and prepaid services. Thus, on
different dates, Sykes Asia hired petitioners as customer service representatives,
team leaders, and trainers for the Alltel Project. Upon expiration of the contract, it
was not renewed thus petitioners were dismissed. Feeling aggrieved, petitioners
filed for illegal dismissal alleging that the expiration of the contract should not affect
their employment since they are already regular employees of respondent.

Issue:
Whether petitioners are regular employees.

Held:
No. they are only project employees. For an employee to be considered project-
based, the employer must show compliance with two (2) requisites, namely that:
(a) the employee was assigned to carry out a specific project or undertaking;
and
(b) the duration and scope of which were specified at the time they were
engaged for such project.
Respondent Sykes Asia adequately complied with both requirements. It informed
petitioners of their employment status at the time of their engagement, as evidenced
by the latters employment contracts and it duly submitted an Establishment
Employment Report and an Establishment Termination Report to the Department of
Labor and Employment Makati-Pasay Field Office regarding the cessation of the
Alltel Project and the list of employees that would be affected by such cessation.
Casea law deems such submission as an indication that the employment was indeed
project-based.

99 Lynvil Fishing Enterprises v. Ariola, G.R. No. 181974, February 1, 2012

Facts:
Petitioner Lynvil Fishing Enterprises, Inc. (Lynvil) is engaged in deep-sea fishing.
Respondents services were engaged in various capacities: captain, chief mate, chief
engineer, cook, oiler, and badger. Petitioner filed a criminal complaint against
respondents before the office of the City Prosecutor, which found probable cause for
indictment of respondents for the crime of qualified theft. The employees filed with
the NLRC a complaint for illegal dismissal and alleged that the unwarranted
accusation of theft stemmed from their oral demand of increase of salaries three
months earlier and their request that they should not be required to sign a blank
payroll and vouchers. Lynvil, on the other hand, contends that it cannot be guilty of
illegal dismissal because the private respondents were employed under a fixed-term
contract, which expired at the end of the voyage.

Issue:
Whether respondents are only contractual employees since their services are on per
voyage basis.

Held:
No. The respondents were doing tasks necessarily to Lynvils fishing business with
positions ranging from captain of the vessel to bodegero; after the end of a trip, they
will again be hired for another trip with new contracts; and this arrangement
continued for more than ten years, the clear intention is to go around the security of
tenure of the respondents as regular employees. Clearly, it was the need for a
continued source of income that forced the employees acceptance of the por viaje
provision. Thus, they are regu;ar employees.

100 Lacuesta v. Ateneo de Manila, G.R. No. 152777, December 9, 2005

Facts:
Respondent Ateneo de Manila University (Ateneo) hired, on a contractual basis,
petitioner Lolita R. Lacuesta as a part-time lecturer in its English Department but
was appointed as full time teacher on probation. Because it was alleged that she is
unable to integrate well with the English Department, her contract was not renewed
thereafter based on the Manual of Regulations of the Ateneo. Hence, she filed for
illegal dismissal. She contends that Articles 280 and 281 of the Labor Code, not the
Manual of Regulations for Private Schools, is the applicable law to determine
whether or not an employee in an educational institution has acquired regular or
permanent status.

Issue:
Which determines the employment status of the faculty?

Held:
The Manual of Regulations for Private Schools, and not the Labor Code, determines
whether or not a faculty member in an educational institution has attained regular
or permanent status. Under Policy Instructions No. 11 issued by the Department of
Labor and Employment, the probationary employment of professors, instructors
and teachers shall be subject to the standards established by the Department of
Education and Culture. Said standards are embodied in paragraph 75 (now Section
93) of the Manual of Regulations for Private Schools
Section 93of the 1992 Manual of Regulations for Private Schools provides that full-
time teachers who have satisfactorily completed their probationary period shall be
considered regular or permanent. Moreover, for those teaching in the tertiary level,
the probationary period shall not be more than six consecutive regular semesters of
satisfactory service. The requisites to acquire permanent employment, or security of
tenure, are (1) the teacher is a full-time teacher; (2) the teacher must have rendered
three consecutive years of service; and (3) such service must have been satisfactory.

As previously held, a part-time teacher cannot acquire permanent status. Only when
one has served as a full-time teacher can he acquire permanent or regular status.
The petitioner was a part-time lecturer before she was appointed as a full-time
instructor on probation. As a part-time lecturer, her employment as such had ended
when her contract expired. Thus, the three semesters she served as part-time
lecturer could not be credited to her in computing the number of years she has
served to qualify her for permanent status.

101 Mt. Carmel College, Inc. v. NLRC, G.R. No. 117514, October 4, 1996
Facts:

Petitioner school hired private respondent as grade school teacher under a written
Contract of Probationary Employment from SY 1989-1990 to SY 1991-1992. In
March 1992, petitioner school terminated the services of private respondent, as she
did not pass the National Teachers Board Examination. Private respondent filed a
complaint for illegal dismissal against the petitioners.

Issue:
Whether respondent was illegally dismissed on the ground of pre-termination of
contract.

Held:
No. There is a distinction between a calendar year (Colegio San Agustin case) and a
school year. Respondents contract expires per school year, not a three-year period.
Private respondents employment contract stipulated that her employment shall be
deemed to run from SY 1989-1990 to SY 1991-1992 (day to day of month to month).
Under Section 48 of the Manual of Regulations for Private Schools, a school year or
academic year begins on the second Monday of June and shall consist of
approximately forty weeks of normally five school days each, exclusive of approved
vacations and including legal and special holidays, and special activities. Petitioners
are not obliged to pay private respondent her salary for the months of April, May
and June as her employment already ceased in March, in accordance with the
provisions of her employment contract.

102 Alfaro v. CA, 363 SCRA 799

Facts:
Star Paper as machine tape operator hired Alfaro. For two months, he was made to
suffer work to do some painting using a spray gun. He got sick because of this and
took a vacation leave. Upon returning to work he was transferred to the wrapping
section. Days after, he complained that the new work given to him was difficult and
has interpreted this as a punishment. As a result, he alleged that he was dismissed
without valid cause and due process of law.

Issue:
Whether the transfer of Alfaro amounts to illegal dismissal.

Held:
No. Records show that Alfaro voluntary resigned from the company. Voluntary
resignation is defined as the act of an employee, who finds himself in a situation in
which he believes that personal reasons cannot be sacrificed in favor of the exigency
of the service; thus, he has no other choice but to disassociate himself from his
employment. Petitioner negotiated for a resignation with separation pay as the
manner in which his employment relations with private respondent would end. He
was already suffering from a lingering illness at the time he tendered his
resignation. His continued employment would have been detrimental not only to his
health, but also to his performance as an employee of private respondent.

103 Intertrod Maritime v. NLRC, 198 SCRA 318

Facts:
Dela Cruz signed a shipboard employment contract with Troodos Shipping
(Principal) and Intertrod Maritime (agent) to serve as Third Engineer on board the
M/T BREEDEN for 12 months. His contract, however, was cut short because of his
own request for relief to disembark which the Master of the ship approved and
accepted. On his return to the Philippines, he filed for illegal dismissal. He claims
that his resignation (reflief) ceased to be effective because he was not immediately
discharged in Port Pylos, Greece, instead, was disembarked in Egypt and in fact
signified his intention of continuing his work prior to the actual disembarkation but
the Master of the ship refused to accept.

Issue:
Whether Whether Dela Cruzs termination is illegal.

Held:
NO. The employee was deemed resigned. Once an employee resigns and his
resignation is accepted, he no longer has any right to the job. If the employee later
changes his mind, he must ask for approval of the withdrawal of his resignation
from his employer, as if he were re-applying for the job. It will then be up to the
employer to determine whether or not his service would be continued. If the
employer accepts said withdrawal, the employee retains his job. If the employer
does not, as in this case, the employee cannot claim illegal dismissal for the
employer has the right to determine who his employees will be. To say that an
employee who has resigned is illegally dismissed, is to encroach upon the right of
employers to hire persons who will be of service to them.
104 Blue Angel Manpower and Security Services, Inc. v. CA, 560 SCRA 157
Facts:
Blue Angel, a messengerial and security agency, hired private respondents as
security guards. By reason of nonpayment of the OT and other benefits and the
deduction of a cash bond, respondents filed for illegal deductions and other money
claims against Blue Angel. When apprised of their original complaint, they were
terminated. Thus, they filed for illegal dismissal. Blue angel, however, denied such
claim and averred that that was no illegal dismissal since respondents tendered
their pro-forma letters of resignation followed by handwritten resignation letters in
the nature of quitclaims.

Issue:
Whether respondents freely and voluntarily resigned as shown by the two sets of
pro-forma resignation letters.

Held:
No. Well-entrenched is the rule that resignation is inconsistent with the filing of a
complaint for illegal dismissal. To constitute resignation, the resignation must be
unconditional with the intent to operate as such. There must be clear intention to
relinquish the position. In this case, private respondents actively pursued their
illegal dismissal case against Blue Angel such that they cannot be said to have
voluntarily resigned from their jobs.

105 Northwest Airlines v. del Rosario, G.R. No. 157633, Sept. 10, 2014
Facts:
Petitioner Northwest Airlines, Inc. employed respondent Ma. Concepcion M. Del
Rosario as one of its Manila based flight attendants. Del Rosario and Gamboa had
engaged in a fight on board the aircraft, which is strictly prohibited in the Rules of
Conduct of the Employees, even if there had been no actual physical contact
between them. Upon investigation, it was found out that Del Rosario was in fault,
thus was terminated. Del Rosario then filed her complaint for illegal dismissal
against Northwest.

Issue: Whether verbal fight between Del Rosario and Gamboa amounts to serious
misconduct, thus justifies dismissal of Del Rosario.

Held:
No. The gravity of the fight, which was not more than a verbal argument between
them, was not enough to tarnish or diminish Northwest's public image. Misconduct
refers to the improper or wrong conduct that transgresses some established and
definite rule of action, a forbidden act, a dereliction of duty, willful in character, and
implies wrongful intent and not mere error in judgment. But misconduct or
improper behavior, to be a just cause for termination of employment, must: (a) be
serious; (b) relate to the performance of the employees duties; and (c) show that
the employee has become unfit to continue working for the employer.
106 Colegio de San Juan de Letran-Calamba v. Villas, G.R. No. 137795, March
26, 2003
Facts:
Respondent Belen Villas was employed by the Petitioner School as high school
teacher and was granted study leave. Schools manual permits faculty a maximum
12 months leave. Respondent failed to use the 1st semester for her study leave and
at the same time was not able to enroll. Respondent was terminated by the
petitioner on the ground that her failure was a violation to the conditions of the
study grant and a sufficient ground to terminate respondents employment; and that
the act of respondent in selling insurance and cookware was prohibited by the
Faculty Manual. Respondent was then filed a case for illegal dismissal.

Issue:
Whether respondents alleged violation of the conditions of the study grant
constituted serious misconduct which justified her termination from Petitioner
School.

Held:
No. Misconduct is improper or wrongful conduct. It is the transgression of some
established and definite rule of action, a forbidden act, a dereliction of duty, willful
in character, and implies wrongful intent and not mere error of judgment. Under
Article 282 of the Labor Code, the misconduct, to be a just cause for termination,
must be serious. This implies that it must be of such grave and aggravated character
and not merely trivial or unimportant. The most respondent could be charged with
was simple misconduct as there was evidence of substantial compliance by
respondent. The act of respondent in selling insurance and cookware was not the
"employment" prohibited by the Faculty Manual for the latter failed to specifically
state the prohibited acts. Thus, in case of ambiguities, it must be resolved in favor of
the respondent.

107 Leus v. St. Scholasticas College, G.R. No. 187226, January 28, 2015
Facts:
Respondent St. Scholasticas College hired LEUS as an Assistant to the Director of the
Lay Apostolate and Community Outreach Directorate. LEUS and her boyfriend
conceived a child out of wedlock. For this reason, she was fired. The school said that
she committed grave and immoral misconduct for engaging in pre marital sexual
relations and that the school needed to uphold Christian morals.

Issue:
Whether the petitioners pregnancy out of wedlock constitutes a valid ground to
terminate her employment.

Held:
No. There is no cause to dismiss the petitioner. Law does not consider her conduct
as disgraceful or immoral. Pre-marital sexual relations between two consenting
adults who have no impediment to marry each other, and, consequently, conceiving
a child out of wedlock, gauged from a purely public and secular view of morality,
does not amount to a disgraceful or immoral conduct under Section 94(e) of the
1992 MRPS.

When the law speaks of immoral or, necessarily, disgraceful conduct as a valid
ground for dismissal, it pertains to public and secular morality; it refers to those
conducts which are proscribed because they are detrimental to conditions upon
which depend the existence and progress of human society.

The determination of whether a conduct is disgraceful or immoral involves a two-

step process: first, a consideration of the totality of the circumstances surrounding
the conduct; and second, an assessment of the said circumstances vis--vis the
prevailing norms of conduct, i.e., what the society generally considers moral and
respectable.

108 Benitez v. Sta. Fe Moving & Relocation, G.R. No. 208163, April 20, 2015
Facts:
Benitez filed a complaint for unfair labor practice and illegal dismissal, with money
claims against respondents. Benitez alleged that the company served him a
memorandum advising him not to report for work effective immediately, thereby
terminating his employment, supposedly on grounds of serious misconduct or
willful disobedience. He allegedly uttered abusive words ("putang ina mo ka VK,
gago ka!) against Kurangil during the companys Christmas Party. He bewailed that
he was not given the opportunity to defend himself.

Issue:
Whether the uttered words by Benitez amounts to serious misconduct.

Held:
Yes. His display of insolent and disrespectful behavior, in utter disregard of the time
and place of its occurrence, had very much to do with his work. He set a bad
example as a union officer and as a crew leader of a vital division of the company.
His actuations during the company's Christmas Party on December 18, 2010, to our
mind, could have had negative repercussions for his employer had he been allowed
to stay on the job. His standing before those clients who witnessed the incident and
those who would hear of it would surely be diminished, to the detriment of the
company.

109 The Coffee Bean & Tea Leaf v. Arenas, G.R. No. 208908, Mar 11, 2015
Facts:
Respondent was a barista at CBTL and was in charge of manning the cashier and
making the beverages. Three incidents occurred before he was fired by petitioner.
The first was when he was seen eating non-CBTL products at the al fresco dining
area while on duty so the counter was left empty without any one assisting the
customers. Second, he was found to have kept an iced tea being chilled inside the bin
where the ice for customers drinks is stored. Third, he was seen to have been
arriving for work late on several occasions (he was just late three times). CBTL
argues that he committed serious misconduct when he lied about using the ice bin
as cooler for his bottled iced tea. Under CBTLs employee handbook, dishonesty,
even at the first instance, warrants the penalty of termination from service. Based
on the foregoing, he was dismissed.

Issue:
Whether the acts of the respondent employee constitutes serious misconduct.

Held:
No. The offenses of Arenas are not grave enough to qualify as just causes for
dismissal. he facts on record reveal that there was no active dishonesty on the part
of Arenas. When questioned about who placed the bottled iced tea inside the ice bin,
his immediate reaction was not to deny his mistake, but to remove the bottle inside
the bin and throw it outside. More importantly, when he was asked to make a
written explanation of his action, he admitted that the bottled iced tea was his. Thus,
even if there was an initial reticence on Arenas part, his subsequent act of owing to
his mistake only shows the absence of a deliberate intent to lie or deceive his CBTL
superiors. On this score, we conclude that Arenas action did not amount to serious
misconduct.

110 St. Lukes Medical v. Sanchez, G.R. No. 212054, March 11, 2015
Facts:
Sanchez was hired by petitioner St. Lukes Medical Center, Inc. (SLMC) as a Staff
Nurse, and was eventually assigned at SLMC, Quezon Citys Pediatric Unit until her
termination for her purported violation of SLMCs Code of Discipline, particularly
Section 1, Rule 1 on Acts of Dishonesty, i.e., Robbery, Theft, Pilferage, and
Misappropriation of Funds. Her termination was brought about by having SLMC
medical stocks (syringes, micropores, cotton balls, etc.) found in her personal bag,
upon the standard inspection of security personnel of SLMC in the SLMC
Centralization Entrance/Exit.

Issue:
Whether Sanchez was illegaly terminated.

Held:
No. Among the employers management prerogatives is the right to prescribe
reasonable rules and regulations necessary or proper for the conduct of its business
or concern, to provide certain disciplinary measures to implement said rules and to
assure that the same would be complied with. At the same time, the employee has
the corollary duty to obey all reasonable rules, orders, and instructions of the
employer; and willful or intentional disobedience thereto, as a general rule, justifies
termination of the contract of service and the dismissal of the employee. Sanchez
was validly dismissed based on her wilfull disregard of the policy of the petitioner.
She knew that such act is prohibited yeat she chose to do it.
111 Mansion Printing Center v. Bitara, Jr., G.R. No. 168120, January 25, 2012
Facts:
Mansion Printing engaged the services of respondent as a helper (kargador).
Respondent was later promoted as the companys sole driver tasked to pick-up raw
materials for the printing business, collect account receivables and deliver the
products to the clients within the delivery schedules. Upon finding that he is grossly
negligent of his duties, tardiness and absences, his services were terminated. Thus,
he filed for illegal dismissal.

Issue:
Whether respondents habitual tardiness is a valid ground for his dismissal.

Held:
Yes. Gross negligence means "want of care in the performance of ones duties
while habitual neglect is the "repeated failure to perform ones duties for a period
of time, depending upon the circumstances. The Labor Code expressly sanctions
both terms as grounds for terminating an employee under Art. 282 of the Code.
Even in the absence of a written company rule defining gross and habitual neglect of
duties, respondents omissions qualify as such warranting his dismissal from the
service. His unauthorized absences totaling 38 out of 66 working days is
conclusively a negligent and habitual act.

112 Aliling v. Feliciano, G.R. No. 185829, April 25, 2012

Facts:
WWWEC hired petitioner Aliling on probationary basis as "Account Executive
(Seafreight Sales) but was actually assigned to handle Ground Express (GX). The
head of his division informed him of his poor performance and was obliged to meet
a quota but he failed to meet the same, thus was terminated. He filed for illegal
dismissal but the respondent company denied such claim and contended that
setting quota is a valid exervise of management prerogative and filure to meet the
same falls under the concept of gross inefficiency, which in turn is analogous to
gross neglect of duty that is a just cause for dismissal under Article 282 of the Code

Issue:
Whether Aliling was legally dismissed on the ground of not meeting the quota set by
the company.

Held:
No. An employer is entitled to impose productivity standards for its workers.
Employees failure to meet the sales quota assigned to each of them constitutes a
just cause of their dismissal, regardless of the permanent or probationary status of
their employment. Failure to observe prescribed standards of work, or to fulfill
reasonable work assignments due to inefficiency may constitute just cause for
dismissal. Such inefficiency is understood to mean failure to attain work goals or
work quotas, either by failing to complete the same within the allotted reasonable
period, or by producing unsatisfactory results. This management prerogative of
requiring standards may be availed of so long as they are exercised in good faith for
the advancement of the employer's interest. WWWEC failed to prove that setting
quotas was exercised in good faith, perceptibly because it could not. Being an
experimental activity and having been launched for the first time, the sales of GX
services could not be reasonably quantified.

Note: An employees failure to meet sales or work quotas falls under the concept of
gross inefficiency, which in turn is analogous to gross neglect of duty that is a just
cause for dismissal under Article 282 of the Code.

113 Reyes-Rayel v. Philippine Luen Thai Holdings, G.R. 174893, July 11, 2012
Facts:
Petitioner Flordeliza Maria Reyes-Rayel, a corporate human resources (CHR)
director, was dismissed from the service by respondents Philippine Luen Thai
Holdings Corp. and L&T International Group Philippines, Inc. for loss of confidence
in her ability to promote their interests. She filed a complaint for illegal dismissal,
praying for separation pay, 13th month pay, moral and exemplary damages and
attorneys fees.

Issue:
Whether failure to promote interest of the employer amount to loss of trust and
confidence, thus results to a valid dismissal of petitioner.

Held:
Yes. Loss of confidence as a ground for dismissal does not require proof beyond
reasonable doubt as the law requires only that there be at least some basis to justify
it. Petitioner received deficient marks and low ratings on areas of problem solving
and decision-making, interpersonal relationships, planning and organization,
project management and integrity notwithstanding an overall passing grade. These
low marks revealed the "degree of petitioners work handicap" and should have
served as a notice for her to improve on her job. However, she appeared complacent
and remained lax in her duties and this naturally resulted to respondents loss of
confidence in her managerial abilities. There is, therefore, sufficient ground to
terminate petitioner on the ground of loss of trust and confident.

114 Villanueva, Jr. v. NLRC, G.R. No. 176893, June 13, 2012
Facts:
Villanueva had been employed as bill collector, teller and branch representative
with Meralco. Complaints were filed before Meralco for unreceipted collections of
Villanueva, to which Villanueva was terminated based on loss of trust and
confidence. Villanueva, however, countered that the ground is not applicable to her
since she is not a managerial employee, thus her termination is illegal.

Issue:
Whether loss of trust and confidence as a ground for termination exclusively applies
to managerial employees.
Held:
No. Loss of confidence generally applies only to: (1) cases involving employees
occupying positions of trust and confidence; or (2) situations where the employee is
routinely charged with the care and custody of the employers money or property.
To the first class belong managerial employees, that is, those vested with the powers
and prerogatives to lay down management polices and/or to hire, transfer, suspend,
lay-off, recall, discharge, assign or discipline employees, or effectively recommend
such managerial actions. To the second class belong cashiers, auditors, property
custodians, or those who, in the normal and routine exercise of their functions,
regularly handle significant amounts of money or property. Villanueva falls in the
latter category. The charges were work related, it was duly proven by substantial
evidence and the breach of companys trust was shown to have been committed
knowingly and willfully.

115 Philippine Plaza Holdings v. Episcope, G.R. No. 192826, February 7, 2013
Facts:
Upon examination of the books of the petitioner by SGV, it was discovered that one
of the transactions bore questionable and invalid discount application. This
transaction was handled by Episcope which she failed to explain why it happened.
Because of his failure, Episcope was terminated for committing acts of dishonesty,
which was classified as a Class D offense under the Hotel's Code of Discipline, as well
as for willful disobedience, serious misconduct and loss of trust and confidence.

Issue:
Whether failure of Episcope as a mere service attendant, can be dismissed on the
ground of loss of trust and confidence.

Held:
Yes. Employers are allowed a wider latitude of discretion in terminating the services
of employees who perform functions by which their nature require the employer's
full trust and confidence. Mere existence of basis for believing that the employee has
breached the trust and confidence of the employer is sufficient and does not require
proof beyond reasonable doubt. Thus, when an employee has been guilty of breach
of trust or his employer has ample reason to distrust him, a labor tribunal cannot
deny the employer the authority to dismiss him. Episcope committed acts of
dishonesty which resulted to monetary loss on the part of PPHI and more
significantly, led to the latters loss of trust and confidence in her. Episcope, as a
service attendant, was the one who actually handled the money tendered to her by
the hotel clients.

116 Torres v. Rural Bank of San Juan, G.R. No. 184520, March 13, 2013
Facts:
Petitioner was dismissed for loss of trust and confidence precipitated by his
unauthorized issuance of a financial accountability clearance in favor of a resigned
employee, who is under audit. Thus, petitioner filed for illegal dismissal and
contended that the ground for his dismissal is not worthy of credence since they
failed to present a copy of the clearance purportedly showing that he cleared Jacinto
of all his financial accountabilities and not merely as to his paid cash advances and
salary loan.

Issue:
Whether failure of the respondent bank to present the clearance, which is the only
evidence available, invalidates the dismissal of the petitioner.

Held:
Yes. To temper the exercise of employers right to dismiss an employee by reason of
willful breach of the trust and confidence and to reconcile the same with the
employees Constitutional guarantee of security of tenure, the law imposes the
burden of proof upon the employer to show that the dismissal of the employee is for
just cause failing which would mean that the dismissal is not justified. Proof beyond
reasonable doubt is not necessary but the factual basis for the dismissal must be
clearly and convincingly established. The onus of submitting a copy of the clearance
allegedly exonerating Jacinto from all his accountabilities fell on the respondents. It
was the single and absolute evidence of the petitioners act that purportedly kindled
the respondents loss of trust. Without it, the respondents allegation of loss of trust
and confidence has no leg to stand on and must thus be rejected.

117 PJ Lhuiller v. Velayo, G.R. No. 198620, November 12, 2014

Facts:
Petitioner hired respondent (Abatayo) as Accounting Clerk. Upon audit
investigation, it was found out that respondent failed to report to his supervisor an
overage amount of P540.00 immediately. Thus, she was terminated for dishonesty,
misappropriation, theft or embezzlement of company funds. Respondent thus filed
for illegal dismissal.

Issue:
Whether respondents failure to account each and every transaction of the employer
is sufficient ground for dismissal under loss of trust and confidence.

Held:
Yes. A cashiers inability to safeguard and account for missing cash is sufficient
cause to dismiss her, intention is immaterial. It is well-settled principle that
misappropriation of company funds, notwithstanding that the shortage has been
restituted, is a valid ground to terminate the services of an employee for loss of trust
and confidence. It would be most unfair to require an employer to continue
employing as its cashier a person whom it reasonably believes is no longer capable
of giving full and whole-hearted trustworthiness in the stewardship of company
funds.

118 Hocheng Phils. v. Farrales, G.R. No. 211497, March 18, 2015
Facts:
A report reached HPC management that a motorcycle helmet of an employee,
Reymar Solas (Reymar), was stolen at the parking lot within its premises. Security
Officer Francisco Paragas III confirmed a CCTV recording showing Farrales taking
the missing helmet from a parked motorcycle. Farrales was asked to explain the
incident but he failed to remember what really transpired and alleged that it was
actually Erics helmet, his neighbor, that he intends to borrow. Thus, he was
dismissed.

Issue:
Whether theft is sufficient ground to dismiss an employee.

Held:
Yes. Theft committed by an employee against a person other than his
employer, if proven by substantial evidence, is a cause analogous to serious
misconduct. The misconduct to be serious must be of such grave and aggravated
character and not merely trivial or unimportant. Such misconduct, however serious,
must, nevertheless, be in connection with the employees work to constitute just
cause for his separation. In the case at bar, petitioner failed to prove that Farrales
stole the helmet by substantial evidence. Farrales immediately admitted his error to
the company guard and sought help to find the owner of the yellow helmet.

119 Yrasuegui v. PAL, G.R. No. 168081, October 17, 2008

Facts:
PAL terminated the employment of the petitioner by reason of violation of company
standards on weight requirements. According to PAL, petitioner was given sufficient
time to lose weight but it failed to do so. Petitioner, on the other hand, contended
that his violation has been condoned and that he was actually discriminated since
company has not been fair in treating the cabin crew members who are similarly
situated.

Issue:
Whether obesity is sufficient ground for dismissal.

Held:
Yes. We hold that the obesity of petitioner, when placed in the context of his work as
flight attendant, becomes an analogous cause under Article 282(e) of the Labor Code
that justifies his dismissal from the service. His obesity may not be unintended, but
is nonetheless voluntary. Voluntariness basically means that the just cause is solely
attributable to the employee without any external force influencing or controlling
his actions. This element runs through all just causes under Article 282, whether
they be in the nature of a wrongful action or omission. Gross and habitual neglect, a
recognized just cause, is considered voluntary although it lacks the element of intent
found in Article 282(a), (c), and (d).

120 Heavylift Manila v. CA & Galay, G.R. No. 154410, October 20, 2005
Facts:
Respondent Galay was dismissed on the ground of her low performance rating and
the negative feedback from her team members regarding her work attitude.
Petitioners claim that the company waited for six months, to give Galay a chance to
undergo counseling before dismissing her from the service but her attitude did not
change or at least improved. Thus, she was terminated from work.

Issue:
Whether "attitude problem" a valid ground for the termination of an employee.

Held:
Yes. An employee who cannot get along with his co-employees is detrimental to the
company for he can upset and strain the working environment. Without the
necessary teamwork and synergy, the organization cannot function well. Thus,
management has the prerogative to take the necessary action to correct the
situation and protect its organization. When personal differences between
employees and management affect the work environment, the peace of the company
is affected. Thus, an employees attitude problem is a valid ground for his
termination. It is a situation analogous to loss of trust and confidence that must be
duly proved by the employer.

121 Protective Maximum Security v. Fuentes, G.R. No. 169303, Feb 11, 2015
Facts:
Celso E. Fuentes (Fuentes) was hired as a security guard by Protective and was
assigned to Post 33. A group of armed persons ransacked Post 33 and took five (5)
M-16 rifles, three (3) carbine rifles, and one (1) Browning Automatic Rifle, all with
live ammunition and magazines. After investigation, the PNP found reason to believe
that Fuentes conspired and acted in consort with the New Peoples Army.
Respondent was then charged with the crime but was acquitted. He returned back
to work but was refused. He then filed a case for illegal dismissal, but the employer
raised the defense that he had abandoned his work.

Issue:
Whether respondent abandoned his job.

Held:
No. Abandonment is the deliberate and unjustified refusal of an employee to resume
his employment. It is a form of neglect of duty, hence, a just cause for termination of
employment by the employer. For a valid finding of abandonment, these two factors
should be present: (1) the failure to report for work or absence without valid or
justifiable reason; and (2) a clear intention to sever employer-employee
relationship, with the second as the more determinative factor which is manifested
by overt acts from which it may be deduced that the employees has [sic] no more
intention to work. The intent to discontinue the employment must be shown by
clear proof that it was deliberate and unjustified. Since there was a justifiable reason
for respondents absence, the first element of abandonment was not established.
Second element is also negated, respondents act of reporting for work after being
cleared of the charges against him showed that he had no intention to sever ties
with his employer.

122 Calipay v. NLRC, G.R. No. 166411, August 3, 2010

Facts:
Petitioners filed a case for illegal dismissal against Triangle Ace Corporation
(Triangle) and Jose Lee, alleging that they were terminated upon their participation
in a co-workers claim for disability benefits with the SSS. Respondents argue that
Petitioners were terminated under just causes, stating that Calipay was on absence
without leave (AWOL).

Issue:
Whether CALIPAY dismissal is valid due to abandonment.

Held:
Yes. 1) Continued absences without approval constituted gross and habitual neglect
which is a just cause for termination under Article 282 of the Labor Code of the
Philippines (2) Jurisprudence has held time and again that abandonment is totally
inconsistent with the immediate filing of a complaint for illegal dismissal, more so if
the same is accompanied by a prayer for reinstatement. In the present case,
however, [the] complaint was filed more than one year after his alleged termination
from employment. Petitioners inconsistency in their stand is also shown by the fact
that in the complaint form which they personally filled up and filed with the NLRC,
they only asked for payment of separation pay and other monetary claims. They did
not ask for reinstatement.

123 Blue Sky Trading Co. v. Blas, G.R. No. 190559, March 7, 2012
Facts:
Respondents were regular employees of petitioner Blue Sky. They were accused of
gross dishonesty in connection with their alleged participation in and conspiracy
with other employees in committing theft against company property, specifically
relative to the loss of the six intensifying screens. They were placed under 30-day
preventive suspension pending investigation but were subsequently terminated.

Issue:
Whether or not petitioners act of ordering respondents preventive suspension was
valid and legal.

Held:
Yes. Preventive suspension may be legally imposed on an employee whose alleged
violation is the subject of an investigation. The purpose of the suspension is to
prevent an employee from causing harm or injury to his colleagues and to the
employer. The maximum period of suspension is 30 days, beyond which the
employee should either be reinstated or be paid wages and benefits due to him.
While the Court does not agree with Blue Sky's subsequent decision to terminate
them from service, there is still no impropriety in its act of imposing preventive
suspension upon the respondents since the period did not exceed the maximum
imposed by law and there was a valid purpose for the same.

124 Canadian Opportunities Unlimited v. Dalangin, Jr., G.R. No. 172223,

February 6, 2012
Facts:
Respondent Dalangin was hired by the company as Immigration and Legal Manager,
with a monthly salary of P15,000.00. He was placed on probation for six months. A
month after, through a memorandum signed by Abad, the company terminated
Dalangins employment, declaring him unfit and unqualified to continue as
Immigration and Legal Manager. Dalangin then filed for illegal dismissal.

Issue:
Whether a month of service is sufficient basis to terminate a probationary
employee.

Held:
Yes. A probationary appointment gives the employer an opportunity to observe the
fitness of a probationer while at work, and to ascertain whether he would be a
proper and efficient employee. The word probationary, as used to describe the
period of employment, implies the purpose of the term or period, but not its length.
Thus, the fact that Dalangin was separated from the service after only about four
weeks does not necessarily mean that his separation from the service is without
basis. Petitioner was able to prove by substantial evidence the company was
justified in terminating Dalangins employment, however brief it had been.

125 Cheniver Deco Print Technics v. NLRC, 325 SCRA 758

Facts:
FACTS:
Petitioner informed its workers about the transfer of the company from its site in
Makati to Sto. Tomas, Batangas. Petitioner decided to relocate its business because
its contract of lease was refused to be renewed by the leesor. In view of the
impending transfer, petitioner gave its employees to inform management of their
willingness to go with petitioner, otherwise, it would hire replacements. Labor
federation informed petitioner that the employees decided to continue working for
petitioner. However, not one reported for work at petitioners new site. Thus, they
were replaced. Petitioner then filed for illegal dismissal.

Issue:
Whether relocation is a valid ground for dismissal of employees.

Held:
Yes. There is no doubt that petitioner has legitimate reason to relocate its plant
because of the expiration of the lease contract on the premises it occupied. That is
its prerogative. But even though the transfer was due to a reason beyond its control,
petitioner has to accord its employees some relief in the form of severance pay.
Consequently, petitioner herein must pay his employees their termination pay in the
amount corresponding to their length of service. Since the closure of petitioners
business is not on account of serious business losses, petitioner shall give private
respondents separation pay equivalent to at least one (1) month or one-half (1/2)
month pay for every year of service, whichever is higher.

126 Am-Phil Food Concepts v. Padilla, G.R. No. 188753, Oct 1, 2014
Facts:
Padilla was hired as a Marketing Associate by Am-Phil, a corporation engaged in the
restaurant business. On September 29, 2002, Am-Phil sent Padilla a letter
confirming his regular employment. Sometime in the first week of March 2004,
three (3) of Am-Phils officers informed Padilla that Am-Phil would be implementing
a retrenchment program that would be affecting three (3) of its employees, Padilla
being one of them. The retrenchment program was allegedly on account of serious
and adverse business conditions, i.e., lack of demand in the market, stiffer
competition, devaluation of the Philippine peso, and escalating operation costs.
Issue:
Whether or not respondent Padila was dismissed through a valid retrenchment
implemented by petitioner Am- Phil Food Concepts, Inc., thus his dismissal is legal.

Held:
No. Retrenchment is an exercise of managements prerogative to terminate the
employment of its employees en masse, to either minimize or prevent losses, or
when the company is about to close or cease operations for causes not due to
business losses. A companys exercise of its management prerogatives is not
absolute. It cannot exercise its prerogative in a cruel, repressive, or despotic
manner. Thus, retrenchment has been described as "a measure of last resort when
other less drastic means have been tried and found to be inadequate."
Retrenchment is, therefore, not a tool to be wielded and used nonchalantly. To
justify retrenchment, it "must be due to business losses or reverses which are
serious, actual and real." Am-Phil failed to establish compliance with the requisites
for a valid retrenchment.

Notes:

Thus, this court has outlined the requirements for a valid retrenchment, each of
which must be shown by clear and convincing evidence, as follows:

(1) that the 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
Department of Labor and Employment 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 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 used fair and reasonable criteria in ascertaining who would be
dismissed and who would be retained among the employees, such as status (i.e.,
whether they are temporary, casual, regular or managerial employees), efficiency,
seniority, physical fitness, age, and financial hardship for certain workers.

127 Mount Carmel Employees Union v. Mount Carmel, G.R. No. 187621,
September 24, 2014
Facts:
Petitioners were academic and non-academic personnel employed by Mount Carmel
Colleges. In 1997 the employees formed a labor union. They were in the process of
negotiating for collective bargaining agreement when in 1999 the school decided to
close its elementary and high school department. Then, the petitioners were
informed of their retrenchment. In 2001 the school reopened its elementary and
high school department with new hired teachers. The petitioners claimed that the
closure was merely a deception and was resorted just to terminate their union
activities.

Issue:
Whether the retrenchment of petitioners was justified.

Held:
NO. The burden of proving that the termination of services is for a valid or
authorized cause rests upon the employer. In termination by retrenchment, not
every loss incurred or expected to be incurred by an employer can justify
retrenchment. The employer must prove, among others, that the losses are
substantial and that the retrenchment is reasonably necessary to avert such losses.
The respondent failed to present any proof establishing how the continued
operations of the elementary and high school departments has become
impracticable. No feasibility studies, analysis, or at the very least, an academic
projection was presented to validate its "forecast."

128 PT&T v. NLRC, 456 SCRA 264

Facts:
Petitioner PT&T decided to implement a temporary retrenchment of some
employees dubbed as Temporary Staff Reduction Program (TSRP) lasting for not
more than five and a half (5) months. Pursuant to the program, affected
employees would receive financial assistance equivalent to 15 days salary and a
loan equivalent to two months salary chargeable to the account of the employee
concerned. Respondents Bayao and Castillo were among the employees affected by
the TSRP and their positions in the company no longer existed. Thus, they filed for
illegal dismissal.

Issue:
Whether the retrenchment program implemented by petitioner PT&T is valid.

Held:
No. While an employer may have a valid ground for implementing a retrenchment
program, it is not excused from complying with the required written notice served
both to the employee concerned and the DOLE at least one month prior to the
intended date of retrenchment. The purpose of this requirement is not only to give
employees some time to prepare for the eventual loss of their jobs and their
corresponding income, look for other employment and ease the impact of the loss of
their jobs but also to give the DOLE the opportunity to ascertain the verity of the
alleged cause of termination. The requirement of notice to both the employees
concerned and the Department of Labor and Employment (DOLE) is mandatory and
must be written and given at least one month before the intended date of
retrenchment. Petitioner PT&T failed to comply this mandatory twin written notice.

Notes:
1. Compliance with the one-month notice rule is mandatory regardless of
whether the retrenchment is temporary or permanent.
2. The employers failure to comply with the one-month notice requirement
prior to retrenchment does not render the termination illegal; it merely
renders the same defective, entitling the dismissed employee to payment of
indemnity in the form of nominal damages. Based on prevailing
jurisprudence, the amount of indemnity is pegged at P30,000.00.

129 Maya Farms Employees Organization v. NLRC, 239 SCRA 508

Facts:
Respondents announced the adoption of an early retirement program as a cost-
cutting measure considering that their business operations suffered major setbacks
over the years. However, there was no response to the program. The early
retirement program was then converted into a special redundancy program, to
which 66 employees were declared redundant and were dismissed. Petitioners
averred that the dismissal of 66 union officers and members circumvented the
provisions in their CBA stating that the LIFO rule (last in, first out) should govern
the lay-off of respondents employees. Respondents contend that their decision an
exercise of management prerogative, which could not be interfered with unless it is
shown to be tainted with bad faith and ill motive.
Issue:
Whether dismissal of the employees on the ground of redundancy was valid under
management prerogative even if LIFO rule in CBA was not observed.

Held:
Yes. It is not disputed that the LIFO rule applies to termination of employment in the
line of work. What is contemplated in the LIFO rule is that when there are two or
more employees occupying the same position in the company affected by the
retrenchment program, the last one employed will necessarily be the first to go.
However, the nature of work and experience should be taken into account by
management. Such criteria was not shown to be whimsical nor carpricious, thus a
valid exercise of management prerogative.

130 Golden Thread Knitting v. NLRC, 304 SCRA 568

Facts:
Several employees of Golden Thread Knitting Industries (GTK) were dismissed for
different reasons. 2 employees were allegedly for slashing the companys products
(towels), 2 for redundancy, 1 for threatening the personnel manager and violating
the company rules, and 1 for abandonment of work. The laborers filed complaints
for illegal dismissal. They allege that the company dismissed them in retaliation for
establishing and being members of the Labor Union. GTK, on the other hand,
contend that there were valid causes for the terminations.

Issue:
Whether redundancy of the positions of Rivera and Macaspac was adequately
proven?

Held:
No. In selecting the employees to be dismissed, fair and reasonable criteria must be
used, such as but not limited to: (a) less preferred status (e. g., temporary
employee), (b) efficiency, and (c) seniority. It is not enough for a company to merely
declare that it has become overmanned. It must produce adequate proof that such is
the actual situation in order to justify the dismissal of the affected employees for
redundancy. The records disclose that petitioners in dismissing Rivera and
Macaspac adopted no criterion whatsoever.

131 GJT Builders v. Ambos, G.R. No. 174184, January 28, 2015
Facts:
G.J.T. Rebuilders is a single proprietorship engaged in steel works and metal
fabrication, employing respondents as machinists. A fire partially destroyed its place
of business that leads to the termination of the respondents employment without
separation pay. Respondents then filed for illegal dismissal. GJTs countered the
claim on the ground that it suffered serious business losses and financial reverses,
forcing it to close its machine shop.
Issue:
Whether there was sufficient proof that G.J.T. Rebuilders suffered from serious
business losses.

Held:
No. To prove serious business losses, employers must present in evidence financial
statements showing the net losses suffered by the business within a sufficient
period of time. Generally, it cannot be based on a single financial statement showing
losses. Absent this proof, employers closing their businesses must pay the dismissed
employees separation pay equivalent to one-month pay or to at least one-half-
month pay for every year of service, whichever is higher. The financial statement
G.J.T. Rebuilders submitted in evidence covers the fiscal years 1996 and 1997. Based
on the financial statement, G.J.T. Rebuilders earned a net income of 61,157.00 in
1996 and incurred a net loss of 316,210.00 in 1997. The Court finds that the two-
year period covered by the financial statement insufficient for G.J.T. Rebuilders to
have objectively perceived that the business would not recover from the loss.

132 Shimizu Phils. v. Callanta, G.R. No. 165923, Sept. 29, 2010
Facts:
Petitioner is a corporation engaged in the construction business, employed
respondent as Safety Officer assigned at petitioners Yutaka-Giken Project and
eventually as Project Administrator of petitioners Structural Steel Division (SSD).
Subsequently, respondent was terminated due to retrenchment and financial crisis
that plague the construction industry. To prove its financial deficit, petitioner
presented financial statements for the years 1995 to 1997 as well as the Securities
and Exchange Commissions approval of petitioners application for a new paid-in
capital amounting to P330,000,000. Respondent then filed an illegal dismissal
complaint.

Issue:
Whether respondent was validly dismissed due to valid retrenchment.

Held:
Yes. Petitioner was able to prove that it incurred substantial business losses, that it
offered to pay respondent his separation pay, that the retrenchment scheme was
arrived at in good faith, and lastly, that the criteria or standard used in selecting the
employees to be retrenched was work efficiency which passed the test of fairness
and reasonableness.

133 International Mgt v. Logarta, G.R. No. 163657, April 18, 2012
Facts:
Petitioner deployed respondent to work for Petrocon. Due to the reduction of man-
hours allotted for cross-country pipeline projects, Petrocon was constrained to
terminate some of its employees, including respondent. Petrocon sent respondent a
30-day notice of termination, with payment of all due benefits in accordance with
the terms and conditions of his employment contract, including his ticket back to the
Philippines. Respondent filed for illegal dismissal upon hid arrival in the Philippines.

Issue:
Whether retrenchment applies to an OFW.

Held:
Yes. Philippine Law recognizes retrenchment as a valid cause for the dismissal of a
migrant or overseas Filipino worker under Article 283 of the Labor
Code. Thus, retrenchment is a valid exercise of management prerogative subject to
the strict requirements set by jurisprudence. In the case at bar, notwithstanding the
fact that respondents termination from his employment was procedurally infirm,
having not complied with the notice requirement, nevertheless the same remains to
be for a just, valid and authorized cause, i.e., retrenchment as a valid exercise of
management prerogative. To stress, despite the employers failure to comply with
the one-month notice to the DOLE prior to respondents termination, it is only a
procedural infirmity, which does not render the retrenchment illegal.

134 North Davao Mining v. NLRC, 254 SCRA 721

Facts:
Respondent Wilfredo Guillema is one among several employees of North Davao who
were separated by reason of the companys closure. North Davao suffered net losses
averaging three billion pesos per year for each of the five years prior to its closure. It
had been giving separation pay equivalent to thirty (30) days' pay for every year of
service. Respondents filed a complaint with the LA claiming for the additional
separation pay equivalent to 17.5 days for every year of service because he was only
paid for 12.5 days.

Issue:
Whether an employer whose business operations ceased due to serious business
losses or financial reverses is obliged to pay separation pay to its employees
separated by reason of such closure.

Held:
No. Article 283 governs the grant of separation benefits in case of closure or
cessation of operation of business establishments NOT due to serious business
losses or financial reverses. Where the closure was due to business losses as in the
instant case in which the aggregate losses amounted to over 20 million the Labor
Code does not impose any obligation upon the employer to pay separation benefits
for obvious reasons. The company's practice of giving one month's pay for every
year of service could no longer be continued precisely because the company could
not afford it anymore.

135 Benson Industries Employees Union v. Benson Employees, G.R. No.

200746, August 6, 2014
Facts:
Respondent Benson Industries, Inc. sent its employees, including herein petitioners,
a notice informing them of their intended termination from employment, on the
ground of closure and/or cessation of business operations. In consequence, the
majority of Bensons employees resigned. They were paid separation pay, computed
at 15 days for every year of service. Notwithstanding, petitioners proffered a claim
for the payment of additional separation pay at the rate of four (4) days for every
year of service on the basis of CBA. Benson opposed petitioners claim, averring that
the separation pay already paid to them was already more than what the law
requires.

Issue:
Whether Petitioners should be awarded with additional separation benefits
equivalent to four (4) days of work for every year of service.

Held:
Yes. Under the Labor Code, cessation of business is treated as an authorized cause
for termination, aimed at preventing further financial drain upon an employer who
cannot anymore pay its employees since business has already stopped. As a form of
recompense, the employer is required to pay its employees separation benefits,
except when the closure is due to serious business losses. The Labor Code does not
obligate an employer to pay separation benefits when the closure is due to serious
losses. When the obligation to pay separation benefits, however, is not sourced from
law, but from contract, such as an existing collective bargaining agreement, the same
must be given respect so long as it is not contrary to law, morals, public order or
public policy. Benson had closed its establishment and ceased operations due to
serious business losses cannot be accepted as an excuse to clear itself of any liability
since the ground of serious business losses because its liability arose from contract
not from law, which he entered with full knowingly and voluntarily.

136 Lopez v. Irvine Construction, G.R. No. 207253, August 20, 2014
Facts:
Irvine Construction hired petitioner Crispin Lopez as laborer and designated him as
a guard at its warehouse. Lopez was purportedly terminated from his employment,
whereupon he was told "Ikaw ay lay-off muna." Thus, he filed a complaint for illegal
dismissal with prayer for the payment of separation benefits against Irvine before
the NLRC. Irvine denied Lopez's claims, alleging that Lopez was asked to return to
work through a letter.

Issue:
Whether or not Lopez was illegally dismissed.

Held:
Yes. Lay-off is an act of the employer of dismissing employees because of losses in
the operation, lack of work, and considerable reduction on the volume of its
business, a right recognized and affirmed by the Court. However, a lay-off would be
tantamount to a dismissal only if it is permanent. When a lay-off is only temporary,
the employment status of the employee is not deemed terminated, but merely
suspended. Pursuant to Article 286 of the Labor Code, the suspension of the
operation of business or undertaking in a temporary lay-off situation must not
exceed six (6) months. The supposed lay- off of Lopez was hardly justified
considering the absence of any causal relation between the cessation of Irvine's
project in Cavite with the suspension of Lopez's work.

137 Poseidon Internatl v. Tamala, G.R. No. 186475, June 26, 2013
Facts:
Petitioner hired Tamala, et al., in behalf of Van Doorn, to man the fishing vessels of
Van Doorn and those of its partners at the coastal and offshore area of Cape Verde
Islands. The operations abruptly stopped and did not resume. Tamala, et al. and its
employer executed two (2) agreements agreeing on the salaries the former would
be receiving initially, 100% of the unexpired portion of their contracts but
subsequently, only 50% of the entire amount. Tamala, et al. also executed waivers
and quitclaims in favor of Poseidon and its principal employers. Thereafter, Tamala,
et al. filed a complaint for illegal termination/illegal dismissal.

Issue:
Whether POSEIDON illegally dismissed respondents TAMALA et al.

Held:
No. Included in this management right is the freedom to close or cease its operations
for any reason, as long as it is done in good faith and the employer faithfully
complies with the substantive and procedural requirements laid down by law and
jurisprudence. Thus, absence any evidence that Van Doorn et al. ever intended to
defeat TAMALA et als rights under our labor laws when it undertook its decision to
close its fishing operations, the termination is deemed valid and does not constitute
illegal dismissal that may be penalized under law.

138 Manila Mining Corp. v. Amor, G.R. No. 182800, Apr. 20, 2015
Facts:
Petitioner served a notice, informing its employees and the (DOLE) of the temporary
suspension of its operations for six months and the temporary lay-off of two-thirds
of its employees. After the lapse of said period, petitioner notified the DOLE that it
was extending the temporary shutdown of its operations for another six months.
Adversely affected by petitioners continued failure to resume its operations,
respondents filed the complaint for constructive dismissal and monetary claims,
including separation pay.

Issue:
Whether or not petitioners cessation of its operations was due to causes beyond its
control, thus not liable for separation pay.

Held:
Without proof of the serious business losses it allegedly sustained and/or
compliance with the reportorial requirements under Article 283 of the Labor Code,
petitioner cannot expediently plead exemption from said liabilities due to the
supposed financial reverses which led to the eventual closure of its business. It is
essentially required that the alleged losses in business operations must be proven
for, otherwise, said ground for termination would be susceptible to abuse by
scheming employers who might be merely feigning business losses or reverses in
their business ventures in order to ease out employees. The condition of business
losses justifying retrenchment is normally shown by audited financial documents
like yearly balance sheets and profit and loss statements as well as annual income
tax returns, which were not presented in this case.

139 Manarpiis v. Texan Phils., G.R. No. 197011, January 28, 2011
Facts:
Texan (TPI) hired Manarpiis as Sales and Marketing Manager in their Aroma
Division. A year after and claiming insurmountable losses, respondents served a
written notice addressed to all their employees that TPI will cease operations.
Manarpiis filed a complaint for illegal dismissal, non-payment of overtime pay,
holiday pay, service incentive leave pay, unexpired vacation leave and 13th month
pay and with prayer for moral and actual damages.

Issue:
Whether petitioner Manarpiis was validly dismissed on the ground of closure due to
serious losses.

Held:
No. If the business closure is due to serious losses or financial reverses, the
employer must present sufficient proof of its actual or imminent losses; it must
show proof that the cessation of or withdrawal from business operations was bona
fide in character. The burden of proving such falls upon the employer. A written
notice to the DOLE thirty days before the intended date of closure is also required,
the purpose of which is to inform the employees of the specific date of termination
or closure of business operations, and which must be served upon each and every
employee of the company one month before the date of effectivity to give them
sufficient time to make the necessary arrangement. Petitioner failed to overcome
the burden of proof; the financial statements supposedly bearing the stamp mark of
BIR were not signed by an independent auditor.

140 SPI Technologies v. Mapua, G.R. No. 191154, April 7, 2014

Facts:
Victoria Mapua was SPI Technologies Inc.s Corporate Development Research/
Business Intelligence Unit Head and Manager. She was under Elizabeth Nolans
supervision. Mapua lost her files and data when her laptop crashed. She missed
some work deadlines. Subsequently, she recovered the lost files with the help of
NBI. However, she was informed that she would be realigned to a lower position
because her colleagues were demotivated by her performance. Mapua tried to
prove herself but she was told to just move on. She then noticed her colleagues
began to avoid her. 95% of her work projects and job responsibilities were
transferred to the rank-and-file staff. Mapua was the dismissed due to redundancy.
One week after, Mapua filed a complaint for illegal dismissal and prayed for
reinstatement or a separation pay.

Issue:
Whether there was a valid termination of employee due to job redundancy

Held:
No. NO. The requisites for a valid implementation of a redundancy program (listed
below) were not met. For a valid implementation of a redundancy program, the
employer must comply with the following requisites:

(1) written notice served on both the employee and the DOLE at least one month
prior to the intended date of termination;
(2) payment of separation pay equivalent to at least one month pay or at least one
month pay for every year of service, whichever is higher;
(3) good faith in abolishing the redundant position; and
(4) fair and reasonable criteria in ascertaining what positions are to be declared
redundant.