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Abbottv.Alcaraz,G.R.No.192571,23July2013
Decision,PerlasBernabe[J]
DissentingOpinion,Brion[J]

RepublicofthePhilippines
SUPREMECOURT
Manila

ENBANC

G.R.No.192571July23,2013

ABBOTT LABORATORIES, PHILIPPINES, CECILLE A. TERRIBLE, EDWIN D. FEIST, MARIA OLIVIA T.


YABUTMISA,TERESITAC.BERNARDO,ANDALLANG.ALMAZAR,Petitioners,
vs.
PEARLIEANNF.ALCARAZ,Respondent.

DECISION

PERLASBERNABE,J.:

Assailedinthispetitionforreviewoncertiorari1aretheDecision2datedDecember10,2009andResolution3dated
June9,2010oftheCourtofAppeals(CA)inCAG.R.SPNo.101045whichpronouncedthattheNationalLabor
Relations Commission (NLRC) did not gravely abuse its discretion when it ruled that respondent Pearlie Ann F.
Alcaraz(Alcaraz)wasillegallydismissedfromheremployment.

TheFacts

OnJune27,2004,petitionerAbbottLaboratories,Philippines(Abbott)causedthepublicationinamajorbroadsheet
newspaperofitsneedforaMedicalandRegulatoryAffairsManager(RegulatoryAffairsManager)whowould:(a)
be responsible for drug safety surveillance operations, staffing, and budget (b) lead the development and
implementationofstandardoperatingprocedures/policiesfordrugsafetysurveillanceandvigilanceand(c)actas
theprimaryinterfacewithinternalandexternalcustomersregardingsafetyoperationsandqueries.4Alcarazwho
was then a Regulatory Affairs and Information Manager at Aventis Pasteur Philippines, Incorporated (another
pharmaceuticalcompanylikeAbbott)showedinterestandsubmittedherapplicationonOctober4,2004.5

OnDecember7,2004,AbbottformallyofferedAlcaraztheabovementionedpositionwhichwasanitemunderthe
companysHospiraAffiliateLocalSurveillanceUnit(ALSU)department.6InAbbottsoffersheet.7itwasstatedthat
Alcarazwastobeemployedonaprobationarybasis.8Laterthatday,sheacceptedthesaidofferandreceivedan
electronicmail(email)fromAbbottsRecruitmentOfficer,petitionerTeresitaC.Bernardo(Bernardo),confirmingthe
same.AttachedtoBernardosemailwereAbbottsorganizationalchartandajobdescriptionofAlcarazswork.9

OnFebruary12,2005,Alcarazsignedanemploymentcontractwhichstated,interalia,thatshewastobeplacedon
probationforaperiodofsix(6)monthsbeginningFebruary15,2005toAugust14,2005.Thesaidcontractwasalso
signedbyAbbottsGeneralManager,petitionerEdwinFeist(Feist):10

PROBATIONARYEMPLOYMENT

DearPearl,

Afterhavingsuccessfullypassedthepreemploymentrequirements,youareherebyappointedas
follows:

PositionTitle:RegulatoryAffairsManager

Department:Hospira

Thetermsofyouremploymentare:
NatureofEmployment:Probationary

Effectivity:February15,2005toAugust14,2005

BasicSalary:P110,000.00/month

Itisunderstoodthatyouagreetoabidebyallexistingpolicies,rulesandregulationsofthecompany,
aswellasthose,whichmaybehereinafterpromulgated.

Unlessrenewed,probationaryappointmentexpiresonthedateindicatedsubjecttoearliertermination
bytheCompanyforanyjustifiablereason.

Ifyouagreetothetermsandconditionsofyouremployment,pleasesignifyyourconformitybelowand
returnacopytoHRD.

WelcometoAbbott!

Verytrulyyours,

Sgd.
EDWIND.FEIST
GeneralManager

CONFORME:

Sgd.
PEARLIEANNFERRERALCARAZ

During Alcarazs preemployment orientation, petitioner Allan G. Almazar (Almazar), Hospiras Country Transition
Manager, briefed her on her duties and responsibilities as Regulatory Affairs Manager, stating that: (a) she will
handlethestaffofHospiraALSUandwilldirectlyreporttoAlmazaronmattersregardingHopiraslocaloperations,
operationalbudget,andperformanceevaluationoftheHospiraALSUStaffwhoareonprobationarystatus(b)she
mustimplementAbbottsCodeofGoodCorporateConduct(CodeofConduct),officepoliciesonhumanresources
andfinance,andensurethatAbbottwillhirepeoplewhoarefitintheorganizationaldiscipline(c)petitionerKelly
Walsh (Walsh), Manager of the Literature Drug Surveillance Drug Safety of Hospira, will be her immediate
supervisor (d) she should always coordinate with Abbotts human resource officers in the management and
disciplineofthestaff(e)HospiraALSUwillspinofffromAbbottinearly2006andwillbeofficiallyincorporatedand
known as Hospira, Philippines. In the interim, Hospira ALSU operations will still be under Abbotts management,
excludingthetechnicalaspectsoftheoperationswhichisunderthecontrolandsupervisionofWalshand(f)the
processingofinformationand/orrawmaterialdatasubjectofHospiraALSUoperationswillbestrictlyconfinedand
controlledunderthecomputersystemandnetworkbeingmaintainedandoperatedfromtheUnitedStates.Forthis
purpose, all those involved in Hospira ALSU are required to use two identification cards: one, to identify them as
Abbottsemployeesandanother,toidentifythemasHospiraemployees.11

On March 3, 2005, petitioner Maria Olivia T. YabutMisa (Misa), Abbotts Human Resources (HR) Director, sent
Alcarazanemailwhichcontainedanexplanationoftheprocedureforevaluatingtheperformanceofprobationary
employeesandfurtherindicatedthatAbbotthadonlyoneevaluationsystemforallofitsemployees.Alcarazwas
also given copies of Abbotts Code of Conduct and Probationary Performance Standards and Evaluation (PPSE)
andPerformance ExcellenceOrientation Modules(PerformanceModules)which she had to apply in line with her
taskofevaluatingtheHospiraALSUstaff.12

Abbotts PPSE procedure mandates that the job performance of a probationary employee should be formally
reviewedanddiscussedwiththeemployeeatleasttwice:firstonthethirdmonthandsecondonthefifthmonthfrom
the date of employment. The necessary Performance Improvement Plan should also be made during the third
month review in case of a gap between the employees performance and the standards set. These performance
standardsshouldbediscussedindetailwiththeemployeewithinthefirsttwo(2)weeksonthejob.Itwasequally
requiredthatasignedcopyofthePPSEformmustbesubmittedtoAbbottsHumanResourcesDepartment(HRD)
andshallserveasdocumentationoftheemployeesperformanceduringhis/herprobationaryperiod.Thisshallform
thebasisforrecommendingtheconfirmationorterminationoftheprobationaryemployment.13

Duringthecourseofheremployment,Alcaraznoticedthatsomeofthestaffhaddisciplinaryproblems.Thus,she
wouldreprimandthemfortheirunprofessionalbehaviorsuchasnonobservanceofthedresscode,moonlighting,
anddisrespectofAbbottofficers.However,AlcarazsmethodofmanagementwasconsideredbyWalshtobe"too
strict."14 Alcaraz approached Misa to discuss these concerns and was told to "lie low" and let Walsh handle the
matter.MisaevenassuredherthatAbbottsHRDwouldsupportherinallhermanagementdecisions.15
On April 12, 2005, Alcaraz received an email from Misa requesting immediate action on the staffs performance
evaluationastheirprobationaryperiodswereabouttoend.ThisAlcarazeventuallysubmitted.16

OnApril20,2005,AlcarazhadameetingwithpetitionerCecilleTerrible(Terrible),AbbottsformerHRDirector,to
discuss certain issues regarding staff performance standards. In the course thereof, Alcaraz accidentally saw a
printedcopyofanemailsentbyWalshtosomestaffmemberswhichessentiallycontainedqueriesregardingthe
formersjobperformance.AlcarazaskedifWalshsactionwasthenormalprocessofevaluation.Terriblesaidthatit
wasnot.17

OnMay16,2005,AlcarazwascalledtoameetingwithWalshandTerriblewhereshewasinformedthatshefailed
tomeettheregularizationstandardsforthepositionofRegulatoryAffairsManager.18Thereafter,WalshandTerrible
requestedAlcaraztotenderherresignation,elsetheybeforcedtoterminateherservices.Shewasalsotoldthat,
regardlessofherchoice,sheshouldnolongerreportforworkandwasaskedtosurrenderherofficeidentification
cards.Sherequestedtobegivenoneweektodecideonthesame,buttonoavail.19

On May 17, 2005, Alcaraz told her administrative assistant, Claude Gonzales (Gonzales), that she would be on
leave for that day. However, Gonzales told her that Walsh and Terrible already announced to the whole Hospira
ALSUstaffthatAlcarazalreadyresignedduetohealthreasons.20

OnMay23,2005,Walsh,Almazar,andBernardopersonallyhandedtoAlcarazaletterstatingthatherserviceshad
been terminated effective May 19, 2005.21 The letter detailed the reasons for Alcarazs termination particularly,
thatAlcaraz:(a)didnotmanagehertimeeffectively(b)failedtogainthetrustofherstaffandtobuildaneffective
rapportwiththem(c)failedtotrainherstaffeffectivelyand(d)wasnotabletoobtaintheknowledgeandabilityto
makesoundjudgmentsoncaseprocessingandarticlereviewwhichwerenecessaryfortheproperperformanceof
herduties.22OnMay27,2005,Alcarazreceivedanothercopyofthesaidterminationletterviaregisteredmail.23

Alcarazfeltthatshewasunjustlyterminatedfromheremploymentandthus,filedacomplaintforillegaldismissal
and damages against Abbott and its officers, namely, Misa, Bernardo, Almazar, Walsh, Terrible, and Feist.24She
claimedthatsheshouldhavealreadybeenconsideredasaregularandnotaprobationaryemployeegivenAbbotts
failure to inform her of the reasonable standards for her regularization upon her engagement as required under
Article29525oftheLaborCode.Inthisrelation,shecontendedthatwhileheremploymentcontractstatedthatshe
wastobeengagedonaprobationarystatus,thesamedidnotindicatethestandardsonwhichherregularization
would be based.26 She further averred that the individual petitioners maliciously connived to illegally dismiss her
when:(a)theythreatenedherwithtermination(b)shewasorderednottoentercompanypremisesevenifshewas
stillanemployeethereofand(c)theypubliclyannouncedthatshealreadyresignedinordertohumiliateher.27

Onthecontrary,petitionersmaintainedthatAlcarazwasvalidlyterminatedfromherprobationaryemploymentgiven
herfailuretosatisfytheprescribedstandardsforherregularizationwhichweremadeknowntoheratthetimeofher
engagement.28

TheLARuling

InaDecisiondatedMarch30,2006,29theLAdismissedAlcarazscomplaintforlackofmerit.

TheLArejectedAlcarazsargumentthatshewasnotinformedofthereasonablestandardstoqualifyasaregular
employee considering her admissions that she was briefed by Almazar on her work during her preemployment
orientationmeeting30andthatshereceivedcopiesofAbbottsCodeofConductandPerformanceModuleswhich
were used for evaluating all types of Abbott employees.31 As Alcaraz was unable to meet the standards set by
Abbott as per her performance evaluation, the LA ruled that the termination of her probationary employment was
justified.32Lastly,theLAfoundthattherewasnoevidencetoconcludethatAbbottsofficersandemployeesactedin
badfaithinterminatingAlcarazsemployment.33

DispleasedwiththeLAsruling,AlcarazfiledanappealwiththeNationalLaborRelationsCommission(NLRC).

TheNLRCRuling

On September 15, 2006, the NLRC rendered a Decision,34 annulling and setting aside the LAs ruling, the
dispositiveportionofwhichreads:

WHEREFORE, the Decision of the Labor Arbiter dated 31 March 2006 [sic] is hereby reversed, annulled and set
asideandjudgmentisherebyrendered:

1.FindingrespondentsAbbot[sic]andindividualrespondentstohavecommittedillegaldismissal
2. Respondents are ordered to immediately reinstate complainant to her former position without loss of
seniorityrightsimmediatelyuponreceipthereof

3. To jointly and severally pay complainant backwages computed from 16 May 2005 until finality of this
decision.Asofthedatehereofthebackwagesiscomputedat

a.Backwagesfor15months PhP1,650,000.00

b.13thmonthpay 110,000.00
TOTAL PhP1,760,000.00

4.Respondents areorderedtopaycomplainantmoraldamagesofP50,000.00 and exemplary damages of


P50,000.00.

5.Respondentsarealsoorderedtopayattorneysfeesof10%ofthetotalaward.

6.Allotherclaimsaredismissedforlackofmerit.

SOORDERED.35

The NLRC reversed the findings of the LA and ruled that there was no evidence showing that Alcaraz had been
apprised of her probationary status and the requirements which she should have complied with in order to be a
regular employee.36 It held that Alcarazs receipt of her job description and Abbotts Code of Conduct and
PerformanceModuleswasnotequivalenttoherbeingactuallyinformedoftheperformancestandardsuponwhich
sheshouldhavebeenevaluatedon.37ItfurtherobservedthatAbbottdidnotcomplywithitsownstandardoperating
procedureinevaluatingprobationaryemployees.38TheNLRCwasalsonotconvincedthatAlcarazwasterminated
foravalidcausegiventhatpetitionersallegationofAlcarazs"poorperformance"remainedunsubstantiated.39

PetitionersfiledamotionforreconsiderationwhichwasdeniedbytheNLRCinaResolutiondatedJuly31,2007.40

Aggrieved,petitionersfiledwiththeCAaPetitionforCertiorariwithPrayerforIssuanceofaTemporaryRestraining
Orderand/orWritofPreliminaryInjunction,docketedasCAG.R.SPNo.101045(FirstCAPetition),alleginggrave
abuseofdiscretiononthepartofNLRCwhenitruledthatAlcarazwasillegallydismissed.41

PendingresolutionoftheFirstCAPetition,AlcarazmovedfortheexecutionoftheNLRCsDecisionbeforetheLA,
which petitioners strongly opposed. The LA denied the said motion in an Order dated July 8, 2008 which was,
however,eventuallyreversedonappealbytheNLRC.42Duetotheforegoing,petitionersfiledanotherPetitionfor
Certiorari with the CA, docketed as CA G.R. SP No. 111318 (Second CA Petition), assailing the propriety of the
executionoftheNLRCdecision.43

TheCARuling

WithregardtotheFirstCAPetition,theCA,inaDecision44datedDecember10,2009,affirmedtherulingofthe
NLRC and held that the latter did not commit any grave abuse of discretion in finding that Alcaraz was illegally
dismissed.

ItobservedthatAlcarazwasnotapprisedatthestartofheremploymentofthereasonablestandardsunderwhich
she could qualify as a regular employee.45 This was based on its examination of the employment contract which
showedthatthesamedidnotcontainanystandardofperformanceoranystipulationthatAlcarazshallundergoa
performanceevaluationbeforeshecouldqualifyasaregularemployee.46ItalsofoundthatAbbottwasunableto
prove that there was any reasonable ground to terminate Alcarazs employment.47 Abbott moved for the
reconsiderationoftheaforementionedrulingwhichwas,however,deniedbytheCAinaResolution48datedJune9,
2010.

TheCAlikewisedeniedtheSecondCAPetitioninaResolutiondatedMay18,2010(May18,2010Resolution)and
ruledthattheNLRCwascorrectinupholdingtheexecutionoftheNLRCDecision.49Thus,petitionersfiledamotion
forreconsideration.

WhilethepetitionersmotionforreconsiderationoftheCAsMay18,2010Resolutionwaspending,Alcarazagain
movedfortheissuanceofawritofexecutionbeforetheLA.OnJune7,2010,petitionersreceivedtheLAsorder
granting Alcarazs motion for execution which they in turn appealed to the NLRC through a Memorandum of
AppealdatedJune16,2010(June16,2010MemorandumofAppeal)onthegroundthattheimplementationof
theLAsorderwouldrenderitsmotionforreconsiderationmootandacademic.50
Meanwhile,petitionersmotionforreconsiderationoftheCAsMay18,2010ResolutionintheSecondCAPetition
was denied via a Resolution dated October 4, 2010.51 This attained finality on January 10, 2011 for petitioners
failure to timely appeal the same.52 Hence, as it stands, only the issues in the First CA petition are left to be
resolved.

Incidentally, in her Comment dated November 15, 2010, Alcaraz also alleges that petitioners were guilty of forum
shopping when they filed the Second CA Petition pending the resolution of their motion for reconsideration of the
CAs December 10, 2009 Decision i.e., the decision in the First CA Petition.53 She also contends that petitioners
havenotcompliedwiththecertificationrequirementunderSection5,Rule7oftheRulesofCourtwhentheyfailed
todiscloseintheinstantpetitionthefilingoftheJune16,2010MemorandumofAppealfiledbeforetheNLRC.54

TheIssuesBeforetheCourt

ThefollowingissueshavebeenraisedfortheCourtsresolution:(a)whetherornotpetitionersareguiltyofforum
shoppingandhaveviolatedthecertificationrequirementunderSection5,Rule7oftheRulesofCourt(b)whether
or not Alcaraz was sufficiently informed of the reasonable standards to qualify her as a regular employee (c)
whetherornotAlcarazwasvalidlyterminatedfromheremploymentand(d)whetherornottheindividualpetitioners
hereinareliable.

TheCourtsRuling

A.ForumShoppingand
ViolationofSection5,Rule7
oftheRulesofCourt.

Attheoutset,itisnoteworthytomentionthattheprohibitionagainstforumshoppingisdifferentfromaviolationof
thecertificationrequirementunderSection5,Rule7oftheRulesofCourt.InSps.Ongv.CA,55theCourtexplained
that:

xxxThedistinctionbetweentheprohibitionagainstforumshoppingandthecertificationrequirementshouldbynow
be too elementary to be misunderstood. To reiterate, compliance with the certification against forum shopping is
separate from and independent of the avoidance of the act of forum shopping itself. There is a difference in the
treatmentbetweenfailuretocomplywiththecertificationrequirementandviolationoftheprohibitionagainstforum
shoppingnotonlyintermsofimposablesanctionsbutalsointhemannerofenforcingthem.Theformerconstitutes
sufficient cause for the dismissal without prejudice to the filing of the complaint or initiatory pleading upon motion
andafterhearing,whilethelatterisagroundforsummarydismissalthereofandfordirectcontempt.xxx.56

As to the first, forum shopping takes place when a litigant files multiple suits involving the same parties, either
simultaneouslyorsuccessively,tosecureafavorablejudgment.Itexistswheretheelementsoflitispendentiaare
present,namely:(a)identityofparties,oratleastsuchpartieswhorepresentthesameinterestsinbothactions(b)
identityofrightsassertedandreliefprayedfor,thereliefbeingfoundedonthesamefactsand(c)theidentitywith
respecttothetwoprecedingparticularsinthetwo(2)casesissuchthatanyjudgmentthatmayberenderedinthe
pendingcase,regardlessofwhichpartyissuccessful,wouldamounttoresjudicataintheothercase.57

Inthiscase,recordsshowthat,exceptfortheelementofidentityofparties,theelementsofforumshoppingdonot
exist. Evidently, the First CA Petition was instituted to question the ruling of the NLRC that Alcaraz was illegally
dismissed.Ontheotherhand,theSecondCAPetitionpertainstotheproprietyoftheenforcementofthejudgment
award pending the resolution of the First CA Petition and the finality of the decision in the labor dispute between
Alcaraz and the petitioners. Based on the foregoing, a judgment in the Second CA Petition will not constitute res
judicatainsofarastheFirstCAPetitionisconcerned.Thus,consideringthatthetwopetitionsclearlycoverdifferent
subjectmattersandcausesofaction,thereexistsnoforumshopping.

Astothesecond,AlcarazfurtherimputesthatthepetitionersviolatedthecertificationrequirementunderSection5,
Rule 7 of the Rules of Court58 by not disclosing the fact that it filed the June 16, 2010 Memorandum of Appeal
beforetheNLRCintheinstantpetition.

Inthisregard,Section5(b),Rule7oftheRulesofCourtrequiresthataplaintiffwhofilesacaseshouldprovidea
completestatementofthepresentstatusofanypendingcaseifthelatterinvolvesthesameissuesastheonethat
wasfiled.Ifthereisnosuchsimilarpendingcase,Section5(a)ofthesameruleprovidesthattheplaintiffisobliged
todeclareunderoaththattothebestofhisknowledge,nosuchotheractionorclaimispending.

RecordsshowthattheissuesraisedintheinstantpetitionandthoseintheJune16,2010MemorandumofAppeal
filed with the NLRC likewise cover different subject matters and causes of action. In this case, the validity of
AlcarazsdismissalisatissuewhereasinthesaidMemorandumofAppeal,theproprietyoftheissuanceofawritof
executionwasinquestion.
Thus,giventhedissimilarissues,petitionersdidnothavetodiscloseinthepresentpetitionthefilingoftheirJune
16, 2010 Memorandum of Appeal with the NLRC. In any event, considering that the issue on the propriety of the
issuanceofawritofexecutionhadbeenresolvedintheSecondCAPetitionwhichinfacthadalreadyattained
finalitythematterofdisclosingtheJune16,2010MemorandumofAppealisnowmootandacademic.

Havingsettledtheforegoingproceduralmatter,theCourtnowproceedstoresolvethesubstantiveissues.

B.Probationaryemployment
groundsfortermination.

A probationary employee, like a regular employee, enjoys security of tenure. However, in cases of probationary
employment,asidefromjustorauthorizedcausesoftermination,anadditionalgroundisprovidedunderArticle295
of the Labor Code, i.e., the probationary employee may also be terminated for failure to qualify as a regular
employeeinaccordancewiththereasonablestandardsmadeknownbytheemployertotheemployeeatthetimeof
the engagement.59 Thus, the services of an employee who has been engaged on probationary basis may be
terminatedforanyofthefollowing:(a)ajustor(b)anauthorizedcauseand(c)whenhefailstoqualifyasaregular
employeeinaccordancewithreasonablestandardsprescribedbytheemployer.60

Corollary thereto, Section 6(d), Rule I, Book VI of the Implementing Rules of the Labor Code provides that if the
employerfailstoinformtheprobationaryemployeeofthereasonablestandardsuponwhichtheregularizationwould
bebasedonatthetimeoftheengagement,thenthesaidemployeeshallbedeemedaregularemployee,viz.:

(d)Inallcasesofprobationaryemployment,theemployershallmakeknowntotheemployeethestandardsunder
whichhewillqualifyasaregularemployeeatthetimeofhisengagement.Wherenostandardsaremadeknownto
theemployeeatthattime,heshallbedeemedaregularemployee.

In other words, the employer is made to comply with two (2) requirements when dealing with a probationary
employee: first, the employer must communicate the regularization standards to the probationary employee and
second,theemployermustmakesuchcommunicationatthetimeoftheprobationaryemployeesengagement.If
theemployerfailstocomplywitheither,theemployeeisdeemedasaregularandnotaprobationaryemployee.

Keeping with these rules, an employer is deemed to have made known the standards that would qualify a
probationaryemployeetobearegularemployeewhenithasexertedreasonableeffortstoapprisetheemployeeof
what he is expected to do or accomplish during the trial period of probation. This goes without saying that the
employeeissufficientlymadeawareofhisprobationarystatusaswellasthelengthoftimeoftheprobation.

Theexceptiontotheforegoingiswhenthejobisselfdescriptiveinnature,forinstance,inthecaseofmaids,cooks,
drivers,ormessengers.61 Also, in Aberdeen Court, Inc. v. Agustin,62 it has been held that the rule on notifying a
probationaryemployeeofthestandardsofregularizationshouldnotbeusedtoexculpateanemployeewhoactsin
amannercontrarytobasicknowledgeandcommonsenseinregardtowhichthereisnoneedtospelloutapolicy
orstandardtobemet.Inthesamelight,anemployeesfailuretoperformthedutiesandresponsibilitieswhichhave
beenclearlymadeknowntohimconstitutesajustifiablebasisforaprobationaryemployeesnonregularization.

Inthiscase,petitionerscontendthatAlcarazwasterminatedbecauseshefailedtoqualifyasaregularemployee
accordingtoAbbottsstandardswhichweremadeknowntoheratthetimeofherengagement.Contrarily,Alcaraz
claimsthatAbbottneverapprisedherofthesestandardsandthus,maintainsthatsheisaregularandnotamere
probationaryemployee.

TheCourtfindspetitionersassertionstobewelltaken.

A punctilious examination of the records reveals that Abbott had indeed complied with the abovestated
requirements.ThisconclusionislargelyimpelledbythefactthatAbbottclearlyconveyedtoAlcarazherdutiesand
responsibilitiesasRegulatoryAffairsManagerpriorto,duringthetimeofherengagement,andtheincipientstages
ofheremployment.Onthisscore,theCourtfindsitapttodetailnotonlytheincidentswhichpointouttotheefforts
madebyAbbottbutalsothosecircumstanceswhichwouldshowthatAlcarazwaswellapprisedofheremployers
expectationsthatwould,inturn,determineherregularization:

(a) On June 27, 2004, Abbott caused the publication in a major broadsheet newspaper of its need for a
RegulatoryAffairsManager,indicatingthereinthejobdescriptionforaswellasthedutiesandresponsibilities
attendanttotheaforesaidpositionthispromptedAlcaraztosubmitherapplicationtoAbbottonOctober4,
2004

(b) In Abbotts December 7, 2004 offer sheet, it was stated that Alcaraz was to be employed on a
probationarystatus

(c) On February 12, 2005, Alcaraz signed an employment contract which specifically stated, inter alia, that
shewastobeplacedonprobationforaperiodofsix(6)monthsbeginningFebruary15,2005toAugust14,
2005

(d) On the day Alcaraz accepted Abbotts employment offer, Bernardo sent her copies of Abbotts
organizationalstructureandherjobdescriptionthroughemail

(e)AlcarazwasmadetoundergoapreemploymentorientationwhereAlmazarinformedherthatshehadto
implementAbbottsCodeofConductandofficepoliciesonhumanresourcesandfinanceandthatshewould
bereportingdirectlytoWalsh

(f)Alcarazwasalsorequiredtoundergoatrainingprogramaspartofherorientation

(g)AlcarazreceivedcopiesofAbbottsCodeofConductandPerformanceModulesfromMisawhoexplained
tohertheprocedureforevaluatingtheperformanceofprobationaryemployeesshewasfurthernotifiedthat
Abbotthadonlyoneevaluationsystemforallofitsemployeesand

(h)Moreover,Alcarazhadpreviouslyworkedforanotherpharmaceuticalcompanyandhadadmittedtohave
an"extensivetrainingandbackground"toacquirethenecessaryskillsforherjob.63

Consideringthetotalityoftheabovestatedcircumstances,itcannot,therefore,bedoubtedthatAlcarazwaswell
awarethatherregularizationwoulddependonherabilityandcapacitytofulfilltherequirementsofherpositionas
Regulatory Affairs Manager and that her failure to perform such would give Abbott a valid cause to terminate her
probationaryemployment.

Verily, basic knowledge and common sense dictate that the adequate performance of ones duties is, by and of
itself, an inherent and implied standard for a probationary employee to be regularized such is a regularization
standardwhichneednotbeliterallyspelledoutormappedintotechnicalindicatorsineverycase.Inthisregard,it
mustbeobservedthattheassessmentofadequatedutyperformanceisinthenatureofamanagementprerogative
which when reasonablyexercisedasAbbottdidinthiscaseshouldberespected. This is especially true of a
managerial employee like Alcaraz who was tasked with the vital responsibility of handling the personnel and
importantmattersofherdepartment.

Infine,theCourtrulesthatAlcarazsstatusasaprobationaryemployeeandherconsequentdismissalmuststand.
Consequently,inholdingthatAlcarazwasillegallydismissedduetoherstatusasaregularandnotaprobationary
employee,theCourtfindsthattheNLRCcommittedagraveabuseofdiscretion.

To elucidate, records show that the NLRC based its decision on the premise that Alcarazs receipt of her job
descriptionandAbbottsCodeofConductandPerformanceModuleswasnotequivalenttobeingactuallyinformed
oftheperformancestandardsuponwhichsheshouldhavebeenevaluatedon.64It,however,overlookedthelegal
implicationoftheotherattendantcircumstancesasdetailedhereinwhichshouldhavewarrantedacontraryfinding
thatAlcarazwasindeedaprobationaryandnotaregularemployeemoreparticularlythefactthatshewaswell
awareofherdutiesandresponsibilitiesandthatherfailuretoadequatelyperformthesamewouldleadtohernon
regularizationandeventually,hertermination.

Accordingly, by affirming the NLRCs pronouncement which is tainted with grave abuse of discretion, the CA
committedareversibleerrorwhich,perforce,necessitatesthereversalofitsdecision.

C.Probationaryemployment
terminationprocedure.

A different procedure is applied when terminating a probationary employee the usual twonotice rule does not
govern.65Section2,RuleI,BookVIoftheImplementingRulesoftheLaborCodestatesthat"iftheterminationis
brought about by the x x x failure of an employee to meet the standards of the employer in case of probationary
employment, it shall be sufficient that a written notice is served the employee, within a reasonable time from the
effectivedateoftermination."

Astherecordsshow,Alcaraz'sdismissalwaseffectedthroughaletterdatedMay19,2005whichshereceivedon
May23,2005andagainonMay27,2005.Statedthereinwerethereasonsforhertermination,i.e.,thatafterproper
evaluation, Abbott determined that she failed to meet the reasonable standards for her regularization considering
herlackoftimeandpeoplemanagementanddecisionmakingskills,whicharenecessaryintheperformanceofher
functions as Regulatory Affairs Manager.66 Undeniably, this written notice sufficiently meets the criteria set forth
above, thereby legitimizing the cause and manner of Alcarazs dismissal as a probationary employee under the
parameterssetbytheLaborCode.67

D.Employersviolationof
companypolicyand
procedure.
Nonetheless, despite the existence of a sufficient ground to terminate Alcarazs employment and Abbotts
compliance with the Labor Code termination procedure, it is readily apparent that Abbott breached its contractual
obligationtoAlcarazwhenitfailedtoabidebyitsownprocedureinevaluatingtheperformanceofaprobationary
employee.

Veritably,acompanypolicypartakesofthenatureofanimpliedcontractbetweentheemployerandemployee.In
PartsDepot,Inc.v.Beiswenger,68ithasbeenheldthat:

Employerstatementsofpolicy...cangiverisetocontractualrightsinemployeeswithoutevidencethattheparties
mutually agreed that the policy statements would create contractual rights in the employee, and, hence, although
thestatementofpolicyissignedbyneitherparty,canbeunilaterallyamendedbytheemployerwithoutnoticetothe
employee,andcontainsnoreferencetoaspecificemployee,hisjobdescriptionorcompensation,andalthoughno
referencewasmadetothepolicystatementinpreemploymentinterviewsandtheemployeedoesnotlearnofits
existenceuntilafterhishiring.Toussaint,292N.W.2dat892.Theprincipleisakintoestoppel.Onceanemployer
establishesanexpresspersonnelpolicyandtheemployeecontinuestoworkwhilethepolicyremainsineffect,the
policy is deemed an implied contract for so long as it remains in effect. If the employer unilaterally changes the
policy,thetermsoftheimpliedcontractarealsotherebychanged. (Emphasisandunderscoringsupplied.)
1wphi1

Hence,givensuchnature,companypersonnelpoliciescreateanobligationonthepartofboththeemployeeand
theemployertoabidebythesame.

Records show that Abbotts PPSE procedure mandates, inter alia, that the job performance of a probationary
employeeshouldbeformallyreviewedanddiscussedwiththeemployeeatleasttwice:firstonthethirdmonthand
second on the fifth month from the date of employment. Abbott is also required to come up with a Performance
Improvement Plan during the third month review to bridge the gap between the employees performance and the
standardsset,ifany.69 In addition, a signed copy of the PPSE form should be submitted to Abbotts HRD as the
samewouldserveasbasisforrecommendingtheconfirmationorterminationoftheprobationaryemployment.70

In this case, it is apparent that Abbott failed to follow the abovestated procedure in evaluating Alcaraz. For one,
there lies a hiatus of evidence that a signed copy of Alcarazs PPSE form was submitted to the HRD. It was not
even shown that a PPSE form was completed to formally assess her performance. Neither was the performance
evaluationdiscussedwithherduringthethirdandfifthmonthsofheremployment.NordidAbbottcomeupwiththe
necessary Performance Improvement Plan to properly gauge Alcarazs performance with the set company
standards.

WhileitisAbbottsmanagementprerogativetopromulgateitsowncompanyrulesandevensubsequentlyamend
them,thisrightequallydemandsthatwhenitdoescreateitsownpoliciesandthereafternotifyitsemployeeofthe
same,itaccordsuponitselftheobligationtofaithfullyimplementthem.Indeed,acontraryinterpretationwouldentail
a disharmonious relationship in the work place for the laborer should never be mired by the uncertainty of flimsy
rulesinwhichthelatterslaborrightsanddutieswould,tosomeextent,depend.

Inthislight,whilethereliesduecausetoterminateAlcarazsprobationaryemploymentforherfailuretomeetthe
standards required for her regularization, and while it must be further pointed out that Abbott had satisfied its
statutorydutytoserveawrittennoticeoftermination,thefactthatitviolateditsowncompanyprocedurerendersthe
termination of Alcarazs employment procedurally infirm, warranting the payment of nominal damages. A further
expositionisapropos.

Caselawhassettledthatanemployerwhoterminatesanemployeeforavalidcausebutdoessothroughinvalid
procedureisliabletopaythelatternominaldamages.

In Agabon v. NLRC (Agabon),71 the Court pronounced that where the dismissal is for a just cause, the lack of
statutory due process should not nullify the dismissal, or render it illegal, or ineffectual. However, the employer
shouldindemnifytheemployeefortheviolationofhisstatutoryrights.72Thus,inAgabon,theemployerwasordered
topaytheemployeenominaldamagesintheamountofP30,000.00.73

Proceeding from the same ratio, the Court modified Agabon in the case of Jaka Food Processing Corporation v.
Pacot(Jaka)74whereitcreatedadistinctionbetweenprocedurallydefectivedismissalsduetoajustcause,onone
hand,andthoseduetoanauthorizedcause,ontheother.

ItwasexplainedthatifthedismissalisbasedonajustcauseunderArticle282oftheLaborCode(nowArticle296)
but the employer failed to comply with the notice requirement, the sanction to be imposed upon him should be
tempered because the dismissal process was, in effect, initiated by an act imputable to the employee if the
dismissalisbasedonanauthorizedcauseunderArticle283(nowArticle297)buttheemployerfailedtocomplywith
thenoticerequirement,thesanctionshouldbestifferbecausethedismissalprocesswasinitiatedbytheemployers
exerciseofhismanagementprerogative.75Hence,inJaka,wheretheemployeewasdismissedforanauthorized
causeofretrenchment76ascontradistinguishedfromtheemployeeinAgabonwhowasdismissedforajustcause
ofneglectofduty77theCourtorderedtheemployertopaytheemployeenominaldamagesatthehigheramount
ofP50,000.00.

Evidently, the sanctions imposed in both Agabon and Jaka proceed from the necessity to deter employers from
futureviolationsofthestatutorydueprocessrightsofemployees.78Insimilarregard,theCourtdeemsitproperto
applythesameprincipletothecaseatbarforthereasonthatanemployerscontractualbreachofitsowncompany
procedurealbeitnotstatutoryinsourcehastheparalleleffectofviolatingthelaborersrights.Sufficeittostate,
thecontractisthelawbetweenthepartiesandthus,breachesofthesameimpelrecompensetovindicatearight
that has been violated. Consequently, while the Court is wont to uphold the dismissal of Alcaraz because a valid
cause exists, the payment of nominal damages on account of Abbotts contractual breach is warranted in
accordancewithArticle2221oftheCivilCode.79

Anenttheproperamountofdamagestobeawarded,theCourtobservesthatAlcarazsdismissalproceededfrom
herfailuretocomplywiththestandardsrequiredforherregularization.Assuch,itisundeniablethatthedismissal
processwas,ineffect,initiatedbyanactimputabletotheemployee,akintodismissalsduetojustcausesunder
Article296oftheLaborCode.Therefore,theCourtdeemsitappropriatetofixtheamountofnominaldamagesat
theamountofP30,000.00,consistentwithitsrulingsinbothAgabonandJaka.

E.Liabilityofindividual
petitionersascorporate
officers.

Itishornbookprinciplethatpersonalliabilityofcorporatedirectors,trusteesorofficersattachesonlywhen:(a)they
assent to a patently unlawful act of the corporation, or when they are guilty of bad faith or gross negligence in
directingitsaffairs,orwhenthereisaconflictofinterestresultingindamagestothecorporation,itsstockholdersor
other persons (b) they consent to the issuance of watered down stocks or when, having knowledge of such
issuance,donotforthwithfilewiththecorporatesecretarytheirwrittenobjection(c)theyagreetoholdthemselves
personally and solidarily liable with the corporation or (d) they are made by specific provision of law personally
answerablefortheircorporateaction.80

In this case, Alcaraz alleges that the individual petitioners acted in bad faith with regard to the supposed crude
mannerbywhichherprobationaryemploymentwasterminatedandthus,shouldbeheldliabletogetherwithAbbott.
Inthesamevein,shefurtherattributesthelossofsomeofherremainingbelongingstothem.81

Alcarazscontentionfailstopersuade.

Ajudiciousperusaloftherecordsshowthatotherthanherunfoundedassertionsonthematter,thereisnoevidence
tosupportthefactthattheindividualpetitionersherein,intheircapacityasAbbottsofficersandemployees,actedin
badfaithorweremotivatedbyillwillinterminating

Alcarazs services. The fact that Alcaraz was made to resign and not allowed to enter the workplace does not
necessarilyindicatebadfaithonAbbottspartsinceasufficientgroundexistedforthelattertoactuallyproceedwith
hertermination.Ontheallegedlossofherpersonalbelongings,recordsarebereftofanyshowingthatthesame
couldbeattributedtoAbbottoranyofitsofficers.Itisawellsettledrulethatbadfaithcannotbepresumedandhe
whoallegesbadfaithhastheonusofprovingit.Alltold,sinceAlcarazfailedtoproveanymaliciousactonthepart
ofAbbottoranyofitsofficers,theCourtfindstheawardofmoralorexemplarydamagesunwarranted.

WHEREFORE, the petition is GRANTED. The Decision dated December 10, 2009 and Resolution dated June 9,
2010oftheCourtofAppealsinCAG.R.SPNo.101045areherebyREVERSEDandSETASIDE.Accordingly,the
DecisiondatedMarch30,2006oftheLaborArbiterisREINSTATEDwiththeMODIFICATIONthatpetitionerAbbott
Laboratories,PhilippinesbeORDEREDtopayrespondentPearlieAnnF.Alcaraznominaldamagesintheamount
ofP30,000.00onaccountofitsbreachofitsowncompanyprocedure.

SOORDERED.

ESTELAM.PERLASBERNABE
AssociateJustice

WECONCUR:

MARIALOURDESP.A.SERENO
ChiefJustice

ANTONIOT.CARPIO PRESBITEROJ.VELASCO,JR.
AssociateJustice AssociateJustice
AssociateJustice AssociateJustice

SeeDissent:
TERESITAJ.LEONARDODECASTRO
ARTUROD.BRION
AssociateJustice
AssociateJustice

DIOSDADOM.PERALTA LUCASP.BERSAMIN
AssociateJustice AssociateJustice

MARIANOC.DELCASTILLO ROBERTOA.ABAD
AssociateJustice AssociateJustice

MARTINS.VILLARAMA,JR. JOSEPORTUGALPEREZ
AssociateJustice AssociateJustice

JOSECATRALMENDOZA BIENVENIDOL.REYES
AssociateJustice AssociateJustice

IjoinJ.Brioninhisdissent
MARVICMARIOVICTORF.LEONEN
AssociateJustice

CERTIFICATION

IcertifythattheconclusionsintheaboveDecisionhadbeenreachedinconsultationbeforethecasewasassigned
tothewriteroftheopinionoftheCourt.

MARIALOURDESP.A.SERENO
ChiefJustice

Footnotes
1Rollo(G.R.No.192571),pp.1458.

2 Id. at 10401054. Penned by Associate Justice Isaias Dicdican, with Associate Justices Remedios A.
SalazarFernandoandRomeoF.Barza,concurring.
3Id.at11391140.

4Id.at74.

5Id.at7576.

6 Id. at 5152. Based on Abbotts organizational structure, the Regulatory Affairs Manager was under the
umbrellaofHospiraALSU,asubdepartmentinAbbottsHospitalCareDivision.ALSUservesasatransition
body of Hospira, Inc., a corporation based in the United States of America, while it is in the process of
organizationinthePhilippines.AbbottintendedtocedethequalifiedemployeesunderALSUtoHospiraonce
thelatterobtaineditsownlegalpersonalitytoengageinbusinessinthePhilippines.
7Id.at165168.AbbottsentAlcarazaninitialoffersheetonDecember1,2004.Thecompensationcontained
thereinwasrenegotiatedandthus,theincreasedofferaspertheoffersheetdatedDecember7,2004.

8Id.at167168.

9Id.at127,169172.

10Id.at174.

11Id.at127128.

12Id.at10421043.
13Id.

14Id.at1044.

15Id.

16Id.

17Id.at10441045.

18Id.at1045.

19Id.

20Id.at1046.

21Id.at1047.

22Id.at1921,78,and8081.

23Id.at1047.

24Id.at255.SeeLaborArbiter(LA)DecisiondatedMarch30,2006.

25Formerly,Article281oftheLaborCoderenumberedpursuanttoRepublicActNo.10151.

26Rollo(G.R.No.192571),p.267.

27Id.at261262.

28Id.at263267.

29Id.at255274.PennedbyLaborArbiterJovencioLl.Mayor,Jr.

30Id.at269.

31Id.at270.

32Id.at271272.

33Id.at273.

34Id.at356378.PennedbyCommissionerRomeoL.Go,withCommissionersBenedictoErnestoR.Bitonio,
Jr.(onleave)andPerlitaB.Velasco,concurring.
35Id.at377378.

36Id.at367.

37Id.at368.

38Id.at369.

39Id.at370373.

40 Id. at 413416. Penned by Commissioner Romeo L. Go, with Presiding Commissioner Gerardo C.
NogralesandCommissionerPerlitaB.Velasco,concurring.
41Id.at417450.

42Id.at1403.

43Id.
44Id.at10401054.

45Idat1052.

46Id.

47Id.at1053.

48Id.at11391140.

49Id.at1218.

50Id.

51Id.at1219.

52Rollo(G.R.No.193976),p.30.

53Rollo(G.R.No.192571),pp.12231228.

54Id.at1224.

55433Phil.490,501502(2002).

56Id.at501502.(Citationsomitted)

57 Republic v. Mangotara, G.R. Nos. 170375, 170505, 17335556, 173401, 17356364, 178779 & 178894,
July7,2010,624SCRA360,428,citingNBIMicrosoftCorporationv.Hwang,499Phil.423,435436(2005).

58Sec.5.Certificationagainstforumshopping.Theplaintifforprincipalpartyshallcertifyunderoathinthe
complaint or other initiatory pleading asserting a claim for relief, or in a sworn certification annexed thereto
andsimultaneouslyfiledtherewith:(a)thathehasnottheretoforecommencedanyactionorfiledanyclaim
involvingthesameissuesinanycourt,tribunalorquasijudicialagencyand,tothebestofhisknowledge,no
such other action or claim is pending therein (b) if there is such other pending action or claim, a complete
statementofthepresentstatusthereofand(c)ifheshouldthereafterlearnthatthesameorsimilaractionor
claimhasbeenfiledorispending,heshallreportthatfactwithinfive(5)daystherefromtothecourtwherein
hisaforesaidcomplaintorinitiatorypleadinghasbeenfiled.

xxxx

59RobinsonsGalleria/RobinsonsSupermarketCorporationv.Ranchez,G.R.No.177937,January19,2011,
640SCRA135,142.

60Id.

61Id.at145.

62495Phil.706,716717(2005).

63Rollo(G.R.No.192571),p.1201.

64Id.at367368,370.

65ReferstotheprocedurestatedinArticle291(b)oftheLaborCode,asrenumberedpursuanttoRepublic
ActNo.10151,viz.:

Article291.MiscellaneousProvisions.

xxxx

(b)Subjecttotheconstitutionalrightofworkerstosecurityoftenureandtheirrighttobeprotectedagainst
dismissal except for a just and authorized cause and without prejudice to the requirement of notice under
Article283ofthisCode,theemployershallfurnishtheworkerwhoseemploymentissoughttobeterminated
a written notice containing a statement of the cause for termination and shall afford the latter ample
opportunity to be heard and to defend himself with the assistance of his representative if he so desires in
accordancewithcompanyrulesandregulationspromulgatedpursuanttoguidelinessetbytheDepartmentof
LaborandEmployment.

xxxx

ThisprocedureisalsofoundinSection2(d),RuleI,BookVIoftheOmnibusRulesImplementingtheLabor
Codewhichstate:

xxxx

(d) In all cases of termination of employment, the following standards of due process shall be substantially
observed:

ForterminationofemploymentbasedonjustcausesasdefinedinArticle282[now,Article296]oftheLabor
Code:

(i)Awrittennoticeservedontheemployeespecifyingthegroundorgroundsfortermination,andgivingsaid
employeereasonableopportunitywithinwhichtoexplainhisside.

(ii) A hearing or conference during which the employee concerned, with the assistance of counsel if he so
desiresisgivenopportunitytorespondtothecharge,presenthisevidence,orrebuttheevidencepresented
againsthim.

(iii)Awrittennoticeofterminationservedontheemployee,indicatingthatupondueconsiderationofallthe
circumstances,groundshavebeenestablishedtojustifyhistermination.
66Rollo,pp.7881.

67Id.at1047.

68170S.W.3d354(Ky.2005).

69Rollo(G.R.No.192571),p.1052.

70Id.at1043.

71G.R.No.158693,November17,2004,442SCRA573.

72Id.at616.

73Id.at620.

74494Phil.114,119121(2005).

75Id.at121.

76Id.at122.

77Supranote71,at605.

78Id.at617.

79Article2221.Nominaldamagesareadjudicatedinorderthatarightoftheplaintiff,whichhasbeenviolated
orinvadedbythedefendant,maybevindicatedorrecognized,andnotforthepurposeofindemnifyingthe
plaintiffforanylosssufferedbyhim.

80Caragv.NLRC,548Phil.581,605(2007),citingMcLeodv.NLRC,541Phil.214,242(2007).

81Rollo(G.R.No.192571),pp.262,1046.

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