Rulings in Cases for Labor Law 1

1. Jesus Reyes vs. Glaucoma Research Foundation

G. R. No. 189255, June 17, 2015
Etched in an unending stream of cases are four standards in determining the existence of an
employer-employee relationship, namely: (a) the manner of selection and engagement of the
putative employee; (b) the mode of payment of wages; (c) the presence or absence of power of
dismissal; and, (d) the presence or absence of control of the putative employees conduct. Most
determinative among these factors is the so-called "control test."
27

Indeed, the power of the employer to control the work of the employee is considered the most
significant determinant of the existence of an employer-employee relationship. This test is
premised on whether the person for whom the services are performed reserves the right to
control both the end achieved and the manner and means used to achieve that end.
28

29

In the present case, petitioner contends that, as evidence of respondents' supposed control over
him, the organizational plans he has drawn were subject to the approval of respondent
corporation's Board of Trustees. However, the Court agrees with the disquisition of the CA on this
matter, to wit:
[Respondents'] power to approve or reject the organizational plans drawn by [petitioner] cannot
be the control contemplated in the "control test." It is but logical that one who commissions
another to do a piece of work should have the right to accept or reject the product. The important
factor to consider in the "control test" is still the element of control over how the work itself is
done, not just the end result thereof.
Well settled is the rule that where a person who works for another performs his job more or less
at his own pleasure, in the manner he sees fit, not subject to definite hours or conditions of work,
and is compensated according to the result of his efforts and not the amount thereof, no
employer-employee relationship exists.
30

What was glaring in the present case is the undisputed fact that petitioner was never subject to
definite working hours. He never denied that he goes to work and leaves therefrom as he
pleases. In fact, on December 1-31, 2004, he went on leave without seeking approval from the
officers of respondent company. On the contrary, his letter simply informed respondents that he
will be away for a month and even advised them that they have the option of appointing his
replacement during his absence. This Court has held that there is no employer-employee
relationship where the supposed employee is not subject to a set of rules and regulations
governing the performance of his duties under the agreement with the company and is not
required to report for work at any time, nor to devote his time exclusively to working for the
company.
31

32

2. DOHLE-Philman vs. Gazzingan

G. R. No. 199568, June 17, 2015
Indeed, the causal connection between the illness contracted and the nature of work of a
seaman is a factual question, which is not a proper subject of this Courts review.
Nonetheless, considering the conflicting findings of the tribunals below, this Court is
constrained to dwell on factual matters involved in this case and reassess the evidence on
record. Gazzingans work as a messman is not confined mainly to serving food and
beverages to all officers and crew; he was likewise tasked to assist the chief cook/chef
steward, and thus performed most if not all the duties in the ships steward department. In
the performance of his duties, he is bound to suffer chest and back pains, which could have

caused or aggravated his illness. As aptly observed by the CA, Gazzingans strenuous
duties caused him to suffer physical stress which exposed him to injuries. It is therefore
reasonable to conclude that Gazzingans employment has contributed to some degree to the
development of his disease.
It must also be pointed out that Gazzingan was in good health and fit to work when he was
engaged by petitioners to work on board the vessel M/V Gloria. His PEME showed
essentially normal findings with no hypertension and without any heart problems. It was only
while rendering duty that he experienced symptoms. This is supported by a medical report
issued by Cartagena de Indias Hospital in Colombia stating that Gazzingan suffered intense
chest and back pains, shortness of breath and a slightly elevated blood pressure while
performing his duties. Therefore, even assuming that Gazzingan had a pre-existing
condition, as alleged by petitioners, this does not totally negate the probability and the
possibility that his aortic dissection was aggravated by his work conditions. The stress
caused by his job actively contributed to the progression and aggravation of his illness. In
compensation cases, "[i]t is sufficient that there is a reasonable linkage between the disease
suffered by the employee and his work to lead a rational mind to conclude that his work may
have contributed to the establishment or, at the very least, aggravation of any pre-existing
condition he might have had."
More importantly, the 2000 POEA-SEC has created a presumption of compensability for
those illnesses which are not listed as an occupational disease. Section 20 (B), paragraph
(4) states that "those illnesses not listed in Section 32 of this Contract are disputably
presumed as work-related." Concomitant with this presumption is the burden placed upon
the claimant to present substantial evidence that his work conditions caused or at least
increased the risk of contracting the disease and only a reasonable proof of workconnection, not direct causal relation is required to establish compensability of illnesses not
included in the list of occupational diseases. As discussed above, a causal link was
established between Gazzingans employment and his ailment. In view thereof, the
presumption now operates in favor of respondents and the burden is shifted to the
petitioners to overcome the statutory presumption. However, in the case at bench,
petitioners failed to discharge such burden.
3.

Awatin vs. Avantgarde, G. R. No. 179226, June 29, 2015

Section 20 (A) sub-paragraphs 1 and 4 of the Standard Terms and Conditions Governing the
Employment of Filipino Seafarers On-Board Ocean-going Vessels on compensation and
benefits in case of death of a seafarer provides:
"l. In case of work-related death of the seafarer during the term of his contract the employer
shall pay his beneficiaries the Philippine Currency equivalent to the amount of Fifty
Thousand US dollars (US$50,000) and an additional Seven Thousand US dollars
(US$7,000) to each child under the age of twenty-one (21) but not exceeding four (4)
children, at the exchange rate prevailing during the time of employment."
"4. The other liabilities of the employer when the seafarer dies as a result of work-related
injury or illness during the term of employment are as follows:
a. The employer shall pay the deceased's beneficiary all outstanding obligations due the
seafarer under this Contract.
b. The employer shall transport the remains and personal effects of the seafarer to the
Philippines at employer's expense except if the death occurred in a port where local
government laws or regulations do not permit the transport of such remains. In case death
occurs at sea, the disposition of the remains shall be handled or dealt with in accordance

with the master's best judgment. In all cases, the employer/master shall communicate with
the manning agency to advise for disposition of seafarer's remains.
c. The employer shall pay the beneficiaries of the seafarer the Philippine currency equivalent
to the amount of One Thousand US dollars (US$1,000) for burial expenses at the exchange
rate prevailing during the time of payment.
On the basis of the foregoing provisions, the death of a seaman to be compensable should
occur during the term of his employment contract and must be the result of a work-related
illness or injury. In the present case, it is not disputed that Awatin died on July 12, 2002,
almost a year after the termination of his last employment contract on July, 2001. It must be
remembered that Awatin was repatriated not because of any illness but because his contract
of employment expired. There is no proof that he contracted his illness during the term of his
employment nor that his working conditions increased the risk of contracting the illness
which caused his death. While the Court adheres to the principle of liberality in favor of the
seafarer in construing the Standard Employment Contract, we cannot allow claims for
compensation based on surmises. When the evidence presented negates compensability,
we have no choice but to deny the claim, lest we cause injustice to the employer.
The law in protecting the rights of the employees, authorizes neither oppression nor selfdestruction of the employer -there may be cases where the circumstances warrant favoring
labor over the interests of management but never should the scale be so tilted as to result in
an injustice to the employer.
4.

Dionisio Dacles vs. Millenium Erectors, G. R. No. 209822, July 8, 2015

Tested against these considerations, the Court finds that the CA correctly granted
respondents' certiorari petition before it, since the NLRC gravely abused its discretion in
ruling that petitioner was a regular employee of MEC when the latter had established by
substantial evidence that petitioner was merely a project employee. On the other hand, there
is no evidence on record to substantiate petitioner's claim that he was employed as early as
1998. Article 294 of the Labor Code, as amended, distinguishes a project-based employee
from a regular employee as follows:
Art. 294. Regular and casual employment. - The provisions of written agreement to the
contrary notwithstanding and regardless of the oral agreement of the parties, an employment
shall be deemed to be regular where the employee has been engaged to perform activities
which are usually necessary or desirable in the usual business or trade of the employer,
except where the employment has been fixed for a specific project or undertaking the
completion or termination of which has been determined at the time of the engagement of
the employee or where the work or services to be performed is seasonal in nature and the
employment is for the duration of the season.
x x x x (Emphasis and underscoring supplied)
Thus, for an employee to be considered project-based, the employer must show 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 the employee was engaged for such project.
Being assigned to a project or a phase thereof which begins and ends at determined or
determinable times, the services of project employees may be lawfully terminated at the
completion of such project or phase. Consequently, in order to safeguard the rights of
workers against the arbitrary use of the word "project" to prevent them from attaining regular
status, employers claiming that their workers are project employees should prove that: (a)
the duration and scope of the employment was specified at the time they were engaged; and
(b) there was indeed a project.

In this case, records reveal that petitioner was adequately informed of his employment status
(as project employee) at the time of his engagement for the NECC and RCB-Malakas
Projects. This is clearly substantiated by the latter's employment contracts duly signed by
him, explicitly stating that: (a) he was hired as a project employee; and (b) his employment
was for the indicated starting dates therein "and will end on completion/phase of work of
project." To the Court's mind, said contracts sufficiently apprised petitioner that his security of
tenure with MEC would only last as long as the specific project or a phase thereof to which
he was assigned was subsisting. Hence, when the project or phase was completed, he was
validly terminated from employment, his engagement being co-terminus only with such
project or phase.
5.

Magsaysay Maritime Corp. vs. Panogalinog, G. R. No. 212049, July 15, 2015

It is doctrinal that the entitlement of seamen on overseas work to disability benefits is a

matter governed not only by medical findings but by law and by contract. The relevant legal
provisions are Articles 191 to 193 of the Labor Code and Section 2, Rule X of the Amended
Rules on Employees' Compensation (AREC), while the relevant contracts are the POEA
Standard Employment Contract (POEA-SEC), the parties' Collective Bargaining Agreement
(CBA), if any, and the employment agreement between the seafarer and employer.
In this case, the parties entered into a contract of employment in accordance with the POEASEC which, as borne from the records, was covered by an overriding International Transport
Workers' Federation (ITF) Cruise Ship Model Agreement For Catering Personnel, i.e., the
CBA, that was effective from January 1, 2010 until December 31, 2010. Since respondent's
injury on board the vessel "Star Princess" that caused his eventual repatriation was
sustained on April 27, 2010, or during the effectivity of the CBA, his claim for the payment of
permanent total disability compensation shall be governed by Article 12 (2) of the CBA which
provides:
2. Disability:
A Seafarer who suffers injury as a result of an accident from any cause whatsoever whilst in
the employment of the Owners/Company, regardless of fault, including accidents occurring
whilst traveling to or from the Ship and whose ability to work is reduced as a result thereof,
shall in addition to his sick pay, be entitled to compensation according to the provisions of
this Agreement.
The compensation which the Owner/Company, Manager, Manning Agent, and any other
legal entity substantially connected with the vessel shall be jointly and severally liable to pay
shall be calculated by reference to an agreed medical report, with the Owners/Company and
the Seafarer both able to commission their own and when there is disagreement the parties
to this Agreement shall appoint a third doctor whose findings shall be binding on all parties.
The aforesaid medical report determines the Degree of Disability and the table below the
Rate of Compensation.
xxxx
Regardless of the degree of disability an injury or illness which results in loss of profession
will entitle the Seafarer to the full amount of compensation, USD eighty-thousand (80,000)
for Ratings (Group B, C & D) and USD one-hundred-and-twenty-thousand (120,000) for
Officers (Group A). For the purposes of this Article, loss of profession means when the
physical condition of the Seafarer prevents a return to sea service, under applicable national
and international standards and/or when it is otherwise clear that the Seafarer's condition will
adversely prevent the Seafarer's future of comparable employment on board ships.

Based on the afore-cited provision, a seafarer shall be entitled to the payment of the full
amount of disability compensation only if his injury, regardless of the degree of disability,
results in loss of profession, i.e., his physical condition prevents a return to sea service.
Based on the submissions of the parties, this contractual attribution refers to permanent total
disability compensation as known in labor law. Thus, the Court examines the presence of
such disability in this case.
6.

Central Azucarera vs. Siason, G. R. No. 215555, July 29, 2015

Resignation is the formal pronouncement or relinquishment of a position or office. It is the

voluntary act of an employee who is in a situation where he believes that personal reasons
cannot be sacrificed in favor of the exigency of the service, and he has then no other choice
but to disassociate himself from employment. The intent to relinquish must concur with the
overt act of relinquishment; hence, the acts of the employee before and after the alleged
resignation must be considered in determining whether he in fact intended to terminate his
employment. In illegal dismissal cases, it is a fundamental rule that when an employer
interposes the defense of resignation, on him necessarily rests the burden to prove that the
employee indeed voluntarily resigned.
In contrast, constructive dismissal exists where there is cessation of work because continued
employment is rendered impossible, unreasonable or unlikely, as an offer involving a
demotion in rank or a diminution in pay and other benefits. Aptly called a dismissal in
disguise or an act amounting to dismissal but made to appear as if it were not, constructive
dismissal may, likewise, exist if an act of clear discrimination, insensibility, or disdain by an
employer becomes so unbearable on the part of the employee that it could foreclose any
choice by him except to forego his continued employment. It must be noted, however, that
bare allegations of constructive dismissal, when uncorroborated by the evidence on record,
cannot be given credence.
Guided by the foregoing considerations, the Court finds that the CA erred in affirming the
NLRC ruling, which found Siason to have been constructively dismissed by petitioners.
A judicious review of the records reveals that CABI's accounting department indeed made an
audit of the purchases made by the company through its Purchasing Officer, Siason. This
resulted in the discovery of a number of questionable discrepancies in several purchasing
transactions undertaken by Siason, consisting in different price quotations for identical items
contained in various purchase documents prepared by Siason herself.
Taking into consideration Siason's long tenure at CABI, as well as her close relationship with
Chan, the latter sent her the October 3, 2011 letter asking her to resign "rather than [to] force
[his] hand" - which should be construed as Chan telling Siason to resign or be faced with an
administrative complaint. On October 4, 2011, Atty. Ner-Tiangco sent Siason another letter,
essentially confirming if the latter was going to resign or if she is subjecting herself to an
administrative investigation. Ultimately, Siason chose to tender her resignation to save
herself from the trouble of besmirching her employment record.
The foregoing facts belie Siason's argument that petitioners constructively dismissed her.
These circumstances show that she was given the option to voluntarily resign from CABI,
instead of dealing with an investigation which might result in her dismissal. Verily, Chan's
decision to give Siason a graceful exit rather than to file an action for redress is perfectly
within the discretion of the former; as it is not uncommon that an employee is permitted to
resign to avoid the humiliation and embarrassment of being terminated for just cause after
the exposure of her malfeasance. It is settled that there is nothing reprehensible or illegal

when the employer grants the employee a chance to resign and save face rather than smear
the latter's employment record, as in this case.
In sum, petitioners did not constructively dismiss Siason; but rather, the latter voluntarily
resigned from her job in order to avoid a full-blown administrative trial regarding her
misdeeds which could potentially result in her termination for just cause. While it may be said
that she did not tender her resignation wholeheartedly, circumstances of her own making did
not give her any other option but to voluntarily do so. Therefore, in view of her voluntary
resignation from CABI, she is not entitled to any separation pay in the absence of any
agreement with petitioners providing for such.
7.

Cusap vs. Adidas Philippines, G. R. No. 201494, July 29, 2015

One of the criteria the CA cited as a basis of its conclusion that PRIME was a legitimate job
contractor was its possession of "substantial capital to finance its undertakings," yet it was
silent on what these undertakings were. It merely said: "We reached this conclusion based
on records which showed PRIME has fulfilled its obligations towards its employees as
regards remittances to Philhealth, the SSS and Pag-ibig." The CA conclusion, to our mind,
fell short of establishing that PRIME satisfied the substantial-capital requirement for
legitimate job contractors under the law and the rules.
Article 106 of the Labor Code provides that "There is 'labor-only' contracting where the
person supplying workers to an employer does not have substantial capital or investment in
the form of tools, equipment, machineries, work premises, among others, and the workers
recruited and placed by such person are performing activities which are directly related to
the principal business of the employer. In such cases, the person or intermediary shall be
considered merely an agent of the employer who shall be responsible to the workers in the
same manner and extent as if the latter were directly employed by him. (emphasis supplied)
Sec. 5, Department Order No. 18-02, s. of 2002, implementing Articles 106 to 109 of the
Labor Code, prohibits labor-only contracting and defines it as "an arrangement where the
contractor or sub-contractor merely recruits, supplies or places workers to perform a job,
work or service for a principal, and any of the following is present: (i) The contractor or
subcontractor does not have substantial capital or investment which relates to the job, work
or service to be performed and the workers recruited, supplied or placed by such contractor
or sub-contractor are performing activities which are directly related to the principal business
of the employer; or (ii) the contractor does not exercise the right to control over the
performance of the work of the contractual employee. x x x 'substantial capital or investment'
refers to capital stocks and subscribed capitalization in the case of corporations, tools,
equipment, implements, machineries and work premises, actually and directly used by the
contractor or subcontractor in the performance or completion of the job, work or service
contracted out." (emphasis supplied) Aside from PRIME's remittances of employee
contributions to Philhealth, SSS, and Pag-ibig and the payment for the complainants' and the
petitioner's wages, we find no indication, except mostly general statements from Adidas,
PRIME and JCA, that PRIME possessed substantial capital or investment to operate as a
legitimate job contractor or subcontractor.
According to Adidas, not only did PRIME have substantial capital or investment to run its
own business operations independent of its clients, it also has sufficient capability to control
and supervise its employees. Yet it offered no proof to substantiate its claim, other than its
recognition of PRIME' s capability to fulfill its obligations towards its employees.
The same thing is true with PRIME. It likewise offered no proof of how or in what manner its
purported substantial capital financed its "promotional and inter-marketing business" with

JCA, except to say that in the pursuit of its business operations, "it has complied with all the
requirements of law anent the rights, privileges and benefits of its employees."
For its part, JCA relied principally on its promotional contract with PRIME to avoid liability,
saying that the terms of their service agreement demonstrate the earmarks of an employer
under the four-fold employer-employee relationship test. It also presented no proof of how or
in what manner PRIME carried out its undertaking under the contract; although like Adidas, it
acknowledged PRIME's payment of the petitioners' and the complainants' wages, and
remittances to Philhealth, SSS, and Pag-ibig.
While the payment of wages and workers' benefits is one of the determinants of an
employer-employee relationship, we do not find it a reliable basis in this case. In fact, a
closer look at the payslips of PRIME's supposed employees reveals that the complainants'
salaries and benefits were under the account of Adidas, giving credence to their claim that
their compensation was charged to Adidas. If indeed JCA and PRIME were an independent
contractor and a subcontractor, respectively, why would the name "ADIDAS" still appear on
the payslips of PRIME's employees.
The answer lies in the fact that Adidas avoided being identified as the complainants' direct
employer so that it would not have to bear the consequences of the complainants' and the
petitioner's regularization. Notably, the records show that these complainants and the
petitioner were engaged not only in 2002, but much earlier; some were even hired in 1995,
including the petitioner, who started selling Adidas products on October 28, 1995. In fact, LA
Salinas relied on the complainants' several years of service of selling Adidas products in
awarding financial assistance to them.
Under these circumstances, we have reason to believe that PRIME, the supposed JCA
subcontractor, just assumed the act of paying the complainants' wages and benefits on
behalf of Adidas, indicating thereby that it was a mere agent of Adidas or a labor-only
contractor. In the light of the complete absence of proof that PRIME applied its "substantial
capital or investment" in performing the promotional job it contracted with JCA, we find
credence in the petitioner's submission that the products she was selling remained to be the
property and under the control of Adidas; that it was Adidas who owned the warehouse
where they were stored; that leased the sales outlets from department stores; and that
provided regular training to her and to the other complainants. The record shows that this
particular claim by the petitioner had not been disputed by either Adidas or JCA.
8.

Richard Rivera vs. Genesis Transport Service, G. R. No. 215568, August 3, 2015

Misconduct and breach of trust are just causes for terminating employment only when
attended by such gravity as would leave the employer no other viable recourse but to cut off
an employee's livelihood.
The Labor Code recognizes serious misconduct, willful breach of trust or loss of confidence,
and other analogous causes as just causes for termination of employment:
Article 282. Termination by employer. An employer may terminate an employment for any of
the following just causes:
(a) Serious misconduct or willful disobedience by the employee of the lawful orders of his
employer or representative in connection with his work;
(b) Gross and habitual neglect by the employee of his duties;

(c) Fraud or willful breach by the employee of the trust reposed in him by his employer or
duly authorized representative;
(d) Commission of a crime or offense by the employee against the person of his employer or
any immediate member of his family or his duly authorized representative; and
(e) Other causes analogous to the foregoing.
Serious misconduct as a just cause for termination was discussed in Yabut v. Manila Electric
Co.:
Misconduct is defined as 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 in judgment." For serious misconduct to justify dismissal, the following requisites
must be present: (a) it must be serious; (b) it must relate to the performance of the
employee's duties; and (c) it must show that the employee has become unfit to continue
working for the employer. (Emphasis supplied, citation omitted)
Thus, it is not enough for an employee to be found to have engaged in improper or wrongful
conduct. To justify termination of employment, misconduct must be so severe as to make it
evident that no other penalty but the termination of the employee's livelihood is viable.
In Philippine Plaza Holdings v. Episcope, we discussed the requisites for valid dismissal on
account of willful breach of trust:
Among the just causes for termination is the employer's loss of trust and confidence in its
employee. Article 296 (c) (formerly Article 282 [c]) of the Labor Code provides that an
employer may terminate the services of an employee for fraud or willful breach of the trust
reposed in him. But in order for the said cause to be properly invoked, certain requirements
must be complied with[,] namely[:] (1) the employee concerned must be holding a position of
trust and confidence and (2) there must be an act that would justify the loss of trust and
confidence.
Relating to the first requisite, Philippine Plaza Holdings clarified that two (2) classes of
employees are considered to hold positions of trust:
It is noteworthy to mention that there are two classes of positions of trust: on the one hand,
there are managerial employees whose primary duty consists of the management of the
establishment in which they are employed or of a department or a subdivision thereof, and to
other officers or members of the managerial staff; on the other hand, there are fiduciary
rank-and-file employees, such as cashiers, auditors, property custodians, or those who, in
the normal exercise of their functions, regularly handle significant amounts of money or
property. These employees, though rank-and-file, are routinely charged with the care and
custody of the employer's money or property, and are thus classified as occupying positions
of trust and confidence. (Emphasis supplied)
The position an employee holds is not the sole criterion. More important than this formalistic
requirement is that loss of trust and confidence must be justified. As with misconduct as
basis for terminating employment, breach of trust demands that a degree of severity attend
the employee's breach of trust. In China City Restaurant Corporation v. National Labor
Relations Commission, this court emphasized the need for caution:
For loss of trust and confidence to be a valid ground for the dismissal of employees, it must
be substantial and not arbitrary, whimsical, capricious or concocted.

Irregularities or malpractices should not be allowed to escape the scrutiny of this Court.
Solicitude for the protection of the rights of the working class [is] of prime importance.
Although this is not [al license to disregard the rights of management, still the Court must be
wary of the ploys of management to get rid of employees it considers as undesirable.
(Emphasis supplied)
9.

Jose Bautista vs. Elburgh Shipmanagement, G. R. No. 206032, August 19, 2015

The entitlement of overseas seafarers to disability benefits is a matter governed, not only by
medical findings, but also by law and contract. The pertinent statutory provisions are Articles
197 to 199 (formerly Articles 191 to 193) of the Labor Code in relation to Section 2, Rule X of
the Rules implementing Title II, Book IV of the said Code; while the relevant contracts are:
(a) the POEA-SEC, which is a standard set of provisions that is deemed incorporated in
every seafarer's contract of employment; (b) the CBA, if any; and (c) the employment
agreement between the seafarer and his employer.
In this case, petitioner executed his employment contract with respondents on August 7,
2008. Accordingly, the provisions of the 2000 POEA-SEC are applicable and should govern
their relations. Sec. 20 (B) (6), of the 2000 POEA-SEC provides:
SECTION 20. COMPENSATION AND BENEFITS
xxxx
B. COMPENSATION AND BENEFITS FOR INJURY OR ILLNESS
The liabilities of the employer when the seafarer suffers work-related injury or illness during
the term of his contract are as follows:
xxxx
6. In case of permanent total or partial disability of the seafarer caused by either injury or
illness the seafarer shall be compensated in accordance with the schedule of benefits arising
from an illness or disease shall be governed by the rates and the rules of compensation
applicable at the time the illness or disease was contracted. (Emphasis supplied.)
Pursuant to the afore-quoted provision, two (2) elements must concur for an injury or illness
to be compensable: first, that the injury or illness must be work-related; and second, that the
work-related injury or illness must have existed during the term of the seafarers employment
contract.
Records reveal that sometime during the performance of his duties as Chief Cook on board
MV Lemno, petitioner complained of breathing difficulty, weakness, severe fatigue,
dizziness, and grogginess, necessitating portside medical intervention and consequent
medical repatriation, albeit, on the basis of suspected "thoracic aneurysm." Shortly after
repatriation, he was diagnosed, inter alia, with Hypertensive Cardiovascular Disease, also
known as hypertensive heart disease, which refers to a heart condition caused by high blood
pressure.
Petitioner's condition was apparently asymptomatic since he manifested no signs and
symptoms of any cardiac injury prior to his deployment onboard MV Lemno and was, in fact,
declared fit for sea duty following his PEME. Notably, petitioner's physical discomforts onboard the vessel already bore the hallmarks of CVD for which he was eventually diagnosed
upon his repatriation. The said diagnosis was recognized by both the company-designated
doctors and petitioner's own doctor, and was well-documented. Thus, absent any showing

that petitioner had a pre-existing cardiovascular ailment prior to his embarkation, the
reasonable presumption is that he acquired his hypertensive cardiovascular disease in the
course of his employment pursuant to Section 32-A (11) (c) of the 2000 POEA-SEC, which
recognizes a "causal relationship" between a seafarer's CVD and his job, and qualifies his
CVD as an occupational disease. In effect, the said provision of law establishes in favor of a
seafarer the presumption of compensability of his disease.
A party in whose favor the legal presumption exists may rely on and invoke such legal
presumption to establish a fact in issue. The effect of a presumption upon the burden of
proof is to create the need of presenting evidence to overcome the prima facie case created,
thereby which, if no contrary proof is offered, will prevail.37 However, other than their bare
and self-serving assertion that petitioner's Hypertensive Cardiovascular Disease was a mere
complication of his Diabetes Mellitus II, respondents failed to introduce countervailing
evidence that would otherwise overcome the disputable presumption of compensability of
the said disease.
10.

Philippine Airlines vs. Alexander Bichara, G. R. No. 213729, September 2, 2015

It would not be proper to accord such relief in this case since, in those cases, the awards of
separation pay in lieu of reinstatement were all hinged on the validity of the employee's
dismissal. Here, the validity of Bichara's termination is the subject matter of a separate case,
i.e., the FASAP case, which is still pending before this Court, and is also beyond the ambit of
the illegal demotion proceedings. Hence, LA Macam exceeded his authority when he ruled
on this issue and directed PAL to pay Bichara separation pay in lieu of reinstatement.
PAL's supervening retrenchment of its employees, which included Bichara, in July 1998, and
his compulsory retirement in July 2005, however, prevent the enforcement of the
reinstatement of Bichara to the position of flight purser under the June 16, 1997 Decision.
Nonetheless, since this Decision had already settled the illegality of Bichara's demotion with
finality, this Court finds that Bichara should, instead, be awarded the salary differential of a
flight purser from a flight steward from the time of his illegal demotion on March 21, 1994 up
until the time he was retrenched in July 1998. Notably, unlike LA Macam's award of
separation pay in lieu of reinstatement, the award of salary differential is not dependent on
the validity of his termination, as it is, in fact, intrinsically linked to the illegality of Bichara's
demotion. Hence, with this direct relation, there should be no obstacle in rendering this
award.
Further, it should be pointed out that the principle of immutability of judgments, from which
the above-stated rule on writ of executions proceed, allow courts, as an exception, to
recognize circumstances that transpire after the finality of the decision which would render
its execution unjust and inequitable and act accordingly. Thus, in view of the supervening
events above-mentioned, this Court deems the award of salary differential to be the just and
equitable award under the circumstances herein prevailing. Jurisprudence holds that courts
may modify or alter the judgment to harmonize the same with justice and the facts when
after judgment has been rendered and the latter has become final, facts and circumstances
transpire which render its execution impossible or unjust, as in this case.
11.

INC Shipmanagement vs. Camporedondo, G. R. No. 199931, September 7, 2015

First off, we hold that the due execution of the Report of incompetent
action/insubordination/indiscipline was established considering that both parties adduced it
to support their respective positions. On one hand, petitioners relied on this Report to prove
that respondent was validly dismissed. On the other hand, respondent admitted that he was
furnished a copy of this Report but he declined to receive it. Thus, as regards the existence
of the subject Report, We find that the same was duly proved here.

However, the contents of this Report were insufficient bases to dismiss respondent. As
stated therein, respondent was dismissed for the following reasons:
DISMISSAL (Brief Details):
HE HAS AN OBVIOUS HANDICAP WHICH IS A STIFF RIGHT ARM. THIS HANDICAP
ALLOWS HIM TO COOK, BUT [REGRETABLY] IT MAKES MR. CAMPOREDONO [sic]
UNABLE TO ALSO SERVE THE MEALS AND CLEAN THE KITCHEN, MESSROOMS,
STORES RESPECTABLE [sic]. WITH ASSISTENCE [sic] OF A MESSMAN HE CAN DO HIS
JOB RESPECTIVE [sic].
As found by the CA, the Report provided no detailed explanation as regards respondent's
supposed incompetence and poor performance. The CA observed that the Report "did not
particularly describe such inability that would lead to the conclusion that he was
incompetent." With this observation of the CA, we fully agree.
As a general concept, poor performance is tantamount to inefficiency and incompetence in
the performance of official duties. An unsatisfactory rating can be a just cause for dismissal
only if it amounts to gross and habitual neglect of duties. Poor or unsatisfactory performance
of an employee does not necessarily mean that he is guilty of gross and habitual neglect of
duties.
To ascribe gross neglect, there must be lack of or failure to exercise slight care or diligence,
or the total absence of care in the performance of duties. In other words, there is gross
neglect when the employee exhibits thoughtless disregard of consequences without exerting
effort to avoid them. On the other hand, habitual neglect involves repeated failure to perform
duties for a certain period of time, depending upon the circumstances, and not mere failure
to perform duties in a single or isolated instance.
As above-discussed, the Report of incompetent action/insubordination/indiscipline against
respondent did not describe the specific acts that would establish his alleged poor
performance, or his want of even slight care in the performance of his official tasks as chief
cook for a certain period of time; hence, even assuming that respondent's performance was
unsatisfactory, petitioners failed to show that his poor performance amounted to gross and
habitual neglect of duties.
Moreover, as correctly pointed out by the CA, no credence can be given to the e-mails
presented by petitioners to support respondent's purported incompetence because these emails were unauthenticated. In addition, they pertained to the previous contract of
respondent, which is unrelated to this present case.
12.

Hanseatic Phils. vs. Arles Ballon, G. R. No. 212764, September 9, 2015

Permanent total disability means an employee is disabled to earn wages in the same or
similar kind of work that he was trained for or accustomed to perform, or in any kind of work
which a person of his mentality and attainment can do. It does not mean a state of absolute
helplessness but merely the inability to do substantially all material acts necessary to the
prosecution of a gainful occupation without serious discomfort or pain and without material
injury or danger to life. In disability compensation, it is not just the injury which is
compensated but the incapacity to work. As ruled in Micronesia Resources v. Cantomayor.
The possibility that petitioner could work as a drummer at sea again does not negate the
claim for permanent total disability benefits.

In the same case of Crystal Shipping, Inc., we held:

Petitioners tried to contest the above findings [of permanent total disability] by showing that
respondent was able to work again as a chief mate in March 2001. Nonetheless, this
information does not alter the fact that as a result of his illness, respondent was unable to
work as a chief mate for almost three years. The law does not require that the illness should
be incurable. What is important is that he was unable to perform his customary work for
more than 120 days which constitutes permanent total disability. [Emphasis Supplied]
Based on the foregoing, the mere fact that a disabled seafarer subsequently acquired
employment does not ipso facto negate the grant of permanent and total disability benefits.
The facts and circumstances of each case must be scrutinized.
In the case at bench, Ballon was medically repatriated on July 26, 2010. Since then, he was
unable to perform his regular employment due to his disability. He was incapacitated to
accomplish his work as AB seaman. It was only on December 24, 2011, or one year and five
months later, that Ballon was able to return to his duties as a seaman with another manning
agency. As Ballon was evidently deprived of his means of livelihood for a protracted period of
time due to this disability, the Court concludes that the grant of permanent and total disability
benefits in favor of Ballon is definitely warranted.
13.
2015

Banco de Oro Unibank vs. Guillermo Sagaysay, G. R. No. 214961, September 16,

Retirement is the result of a bilateral act of the parties, a voluntary agreement between the
employer and the employee whereby the latter, after reaching a certain age, agrees to sever
his or her employment with the former. Article 287 of the Labor Code is the primary provision
which governs the age of retirement and states:
Art. 287. Retirement. xxx
In the absence of a retirement plan or agreement providing for retirement benefits of
employees in the establishment, an employee upon reaching the age of sixty (60) years or
more, but not beyond sixty-five (65) years which is hereby declared the compulsory
retirement age, who has served at least five (5) years in the said establishment, may retire
and shall be entitled to retirement pay equivalent to at least one-half (1/2) month salary for
every year of service, a fraction of at least six (6) months being considered as one whole
year. [Emphasis Supplied]
Doubtless, under this provision, the retirement age is primarily determined by the existing
agreement or employment contract. Only in the absence of such an agreement shall the
retirement age be fixed by law, which provides for a compulsory retirement age at 65 years,
while the minimum age for optional retirement is set at 60 years.
Retirement plans allowing employers to retire employees who have not yet reached the
compulsory retirement age of 65 years are not per se repugnant to the constitutional
guaranty of security of tenure. By its express language, the Labor Code permits employers
and employees to fix the applicable retirement age at 60 years or below, provided that the
employees' retirement benefits under any CBA and other agreements shall not be less than
those provided therein.
Acceptance by the employees of an early retirement age option must be explicit, voluntary,
free, and uncompelled. While an employer may unilaterally retire an employee earlier than
the legally permissible ages under the Labor Code, this prerogative must be exercised

pursuant to a mutually instituted early retirement plan. In other words, only the
implementation and execution of the option may be unilateral, but not the adoption and
institution of the retirement plan containing such option. For the option to be valid, the
retirement plan containing it must be voluntarily assented to by the employees or at least by
a majority of them through a bargaining representative.
Some of the cases decided by the Supreme Court reveals that the retirement plan was
adopted after the employees were hired by their employer. This is in stark contrast with the
case at bench wherein the adoption of the retirement plan came before the hiring of
Sagaysay. Thus, the present petition portrays a unique predicament on whether a retirement
plan adopted before the employment of an employee is deemed binding on the latter.
14.

Chevron (Phils.) vs. Vitaliano Galit, G. R. No. 186114, October 7, 2015

To ascertain the existence of an employer-employee relationship, jurisprudence has

invariably adhered to the four-fold test, to wit: (1) the selection and engagement of the
employee; (2) the payment of wages; (3) the power of dismissal; and (4) the power to control
the employee's conduct, or the so-called "control test." Of these four, the last one is the most
important. The so-called "control test" is commonly regarded as the most crucial and
determinative indicator of the presence or absence of an employer-employee relationship.
Under the control test, an employer-employee relationship exists where the person for whom
the services are performed reserves the right to control not only the end achieved, but also
the manner and means to be used in reaching that end.
The Job Contract between petitioner and SJS demonstrate that the latter possessed the
following earmarks of an employer, to wit: (1) the power of selection and engagement of
employees, under.Sections 4.1 and 6.1(d); (2) the payment of wages, under Sections 4.1
and 6.1(c); (3) the power to discipline and dismiss, under Section 4.1; and, (4) the power to
control the employee's conduct, under Sections 4.1, 4.2, and 5.1.
As to SJS' power of selection and engagement, Galit himself admitted in his own affidavit
that it was SJS which assigned him to work at Chevron's Pandacan depot. As such, there is
no question that it was SJS which selected and engaged Galit as its employee.
With respect to the payment of wages, the Court finds no error in the findings of the LA that
Galit admitted that it was SJS which paid his wages. While Galit claims that petitioner was
the one which actually paid his wages and that SJS was merely used as a conduit, Galit
failed to present evidence to this effect. Galit, likewise, failed to present sufficient proof to
back up his claim that it was petitioner, and not SJS, which actually paid his SSS, Philhealth
and Pag-IBIG premiums. On the contrary, it is .unlikely that SJS would report Galit as its
worker, pay his SSS, Philhealth and Pag-IBIG premiums, as well as his wages, if it were not
true that he was indeed its employee. In the same manner, the Quitclaim and Release,
which was undisputedly signed by Galit, acknowledging receipt of his separation pay from
SJS, is an indirect admission or recognition of the fact that the latter was indeed his
employer. Again, it would be unlikely for SJS to pay Galit his separation pay if it is not the
latter's employer.
Galit also did not dispute the fact that he was dismissed from employment by reason of the
termination of the service contract between SJS and petitioner. In other words, it was not
petitioner which ended his employment. He was dismissed therefrom because petitioner no
longer renewed its contract with SJS and that the latter subsequently ceased to operate.
Anent the power of control, the Court again finds no cogent reason to depart from the
findings of the NLRC that in case of matters that needed to be addressed with respect to
employee performance, petitioner dealt directly with SJS and not with the employee

concerned. In any event, it is settled that such power merely calls for the existence of the
right to control and not necessarily the exercise thereof. In the' present case, the Job
Contract between petitioner and SJS clearly provided that SJS "shall retain the right to
control the manner and the means of performing the work, with [petitioner] having the control
or direction only as to the results to be accomplished."
15.

Melvin Mallo vs. Southeast Asian College, G. R. No. 212861, October 14, 2015

While the Court concurs with the CA that Mallo was not illegally dismissed, the Court does
not agree that he had abandoned his work. The concept of abandonment in labor law had
been thoroughly discussed in Tan Brothers Corporation of Basilan City v. Escudero:
As defined under established jurisprudence, abandonment is the deliberate and unjustified
refusal of an employee to resume his employment. It constitutes neglect of duty and is a just
cause for termination of employment under paragraph (b) of Article 282 [now Article 296] of
the Labor Code. To constitute abandonment, however, there must be a clear and deliberate
intent to discontinue one's employment without any intention of returning. In this regard, two
elements must concur: (1) failure to report for work or absence without valid or justifiable
reason; and (2) a clear intention to sever the employer-employee relationship, with the
second element as the more determinative factor and being manifested by some overt acts.
Otherwise stated, absence must be accompanied by overt acts unerringly pointing to the fact
that the employee simply does not want to work anymore. It has been ruled that the
employer has the burden of proof to show a deliberate and unjustified refusal of the
employee to resume his employment without any intention of returning. (Emphasis and
underscoring supplied)
In this case, records are bereft of any indication that Mallo's absence from work was
deliberate, unjustified, and with a clear intent to sever his employment relationship with
SACI. While respondents claim to have assigned Mallo as Clinical Instructor at UDMC after
failing the qualifying tests at NCMH, which assignment the latter initially accepted, but
eventually declined, there is no proof that Mallo was informed of such assignment. It bears
stressing that a party alleging a critical fact must support his allegation with substantial
evidence for any decision based on unsubstantiated allegation cannot stand as it will offend
due process.
More importantly, Mallo's filing of a complaint for illegal dismissal, coupled with his prior acts
of actively inquiring about his teaching load, negate any intention on his part to sever his
employment. Indeed, it is simply absurd for Mallo to provide continuous service to SACI for
more than three (3) years in order to attain a regular status, only to leave his job without any
justifiable reason and, thereafter, file a case in an attempt to recover the same. To reiterate,
abandonment of position is a matter of intention and cannot be lightly inferred, much less
legally presumed, from certain equivocal acts.
In sum, since Mallo's was not dismissed and that he never abandoned his job, it is only
proper for him to report back to work and for respondents to reinstate him to his former
position or a substantially-equivalent one in its stead. In this regard, jurisprudence provides
that in instances where there was neither dismissal by the employer nor abandonment by
the employee, the proper remedy is to reinstate the employee to his former position but
without the award of backwages.
16.

Modesto Rivera vs. Allied Banking Corporation, G. R. No. 196597, October 21, 2015

Under Article 282(c) of the Labor Code, as amended, an employer may dismiss the
employee either for (1) fraud; or (2) willful breach by the employee of the trust reposed in
him by his employer or duly authorized representative.

Law and jurisprudence have long recognized the right of employers to dismiss employees by
reason of loss of trust and confidence. More so, in the case of supervisors or personnel
occupying positions of responsibility, loss of trust justifies termination. Loss of confidence as
a just cause for dismissal is premised on the fact that an employee concerned holds a
position of trust and confidence.
While it is true that loss of trust and confidence is one of the just causes for termination, such
loss of trust and confidence must, however, have some basis. Proof beyond reasonable
doubt is not required. It is sufficient that there must only be some basis for such loss of
confidence or that there is reasonable ground to believe, if not to entertain, the moral
conviction that the concerned employee is responsible for the misconduct and that the
nature of his participation therein rendered him absolutely unworthy of trust and confidence
demanded by his position. Loss of trust and confidence, to be a valid cause for dismissal,
must be based on a willful breach of trust and founded on clearly established facts.
There is no question that petitioner's position as Branch Head requires a high degree of trust
and confidence. Given the sensitive functions of his office, he is thus expected to strictly
observe and comply with the Bank's standard operating procedures.
Contrary to petitioner's asseveration, respondents did not just rely on the allegations of Ms.
Sta. Cruz, whose complaint merely triggered the full investigation conducted by the Bank on
the return of several foreign currency checks. Subsequently, the audit on petitioner's branch
revealed that several US Dollar denominated currency checks were returned due to forged
or unauthorized endorsements. The practice of accepting for deposit second-endorsed US
Dollar denominated checks is strictly prohibited under the Bank's established policies, and
may be allowed only in certain exceptional cases.
17.

Punongbayan and Araullo vs. Roberto Lepon, G. R. No. 174115, November 9, 2015

Article 297(c) of the Labor Code, as amended, provides that an employer may terminate an
employee for willful breach by the employee of trust reposed in him by his employer or duly
authorized representative.
While the right of an employer to freely select or discharge his employees is subject to
regulation by the State in the exercise of its paramount police power, there is also an equally
established principle that an employer cannot be compelled to continue in employment an
employee guilty of acts inimical to the interest of the employer and justifying loss of
confidence in him.
In Bristol Myers Squibb (Phils.), Inc. v. Baban, this Court explained that the following
requisites must be satisfied to justify a valid dismissal based on loss of trust and confidence,
to wit:
(1) The employee concerned must be one holding a position of trust and confidence; and
(2) There must be an act that would justify the loss of trust and confidence.
These two requisites are present in this case.
As to the first requisite, employees holding positions of trust and confidence may be
classified into two. The first class consists of the managerial employees who are vested with
the powers and prerogatives to lay down management policies and to hire, transfer,
suspend, lay off, recall, discharge, assign or discipline employees or effectively recommend
such managerial actions. The second class consists of cashiers, auditors, property

custodians, etc., who in the normal and routine exercise of their functions, regularly handle
significant amounts of money or property.
The Labor Arbiter and the NLRC correctly ruled that respondent was a managerial
employee. At the time of his termination on June 16, 2002, respondent was the Manager-inCharge of the Cebu operations and the Director of the Visayas-Mindanao operations of P&A.
The Labor Arbiter noted that respondent failed to dispute that his position, as the highest
ranking officer of P&A's Visayas-Mindanao operations, demanded utmost trust and
confidence. The NLRC ruled that as Director of the Visayas-Mindanao operations,
respondent was bound by more exacting work ethics and was expected to uphold the dignity
and interest of P&A even if his opinion ran counter to that of his employer.
The second requisite is also present. P&A's loss of trust and confidence is based on a willful
breach of trust, and is founded on clearly established facts. In Mendoza v. HMS Credit
Corporation, this Court distinguished the degree of proof required in proving loss of trust and
confidence in a managerial employee on one hand, and a rank and file employee on the
other:chanRoblesvirtualLawlibrary
The degree of proof required in labor cases is not as stringent as in other types of eases. It
must be noted, however, that recent decisions of this Court have distinguished the treatment
of managerial employees from that of rank-and-file personnel, insofar as the application of
the doctrine of loss of trust and confidence is concerned. Thus, with respect to rank-and-file
personnel, loss of trust and confidence as ground for valid dismissal requires proof of
involvement in the alleged events in question, and that mere uncorroborated assertions and
accusations by the employer will not be sufficient. But as regards a managerial employee,
the mere existence of a basis for believing that such employee has breached the trust of his
employer would suffice for his dismissal. Hence, in the case of managerial employees, proof
beyond reasonable doubt is not required, it being sufficient that there is some basis for such
loss of confidence, such as when the employer has reasonable ground to believe that the
employee concerned is responsible for the purported misconduct, and the nature of his
participation therein renders him unworthy of the trust and confidence demanded by his
position. (Citations omitted; Emphasis supplied)
Respondent breached the trust reposed in him by committing the following acts: (1)
negotiating to transfer to a competing firm while still employed with P&A; (2) enjoining a
number of P&A's clients to transfer their audit business to a competing firm; (3) inviting
P&A's staff to join him in his transfer to a competing firm; and (4) enjoining P&A's staff to
engage in a sympathy strike during his preventive suspension.
18.

New Filipino Maritime vs. Vincent Datayan, G. R. No. 202859, November 11, 2015

The suicide note is informative as to why Simon committed suicide. He declined to join the
party held prior to the drill and was reprimanded for his poor performance in said drill. It can,
thus, be inferred from the note that he blamed himself for the difficulties he assumed to have
caused his colleagues.
As such, to refute petitioners' position that Simon committed suicide, the burden of evidence
shifts to respondent. Nonetheless, respondent failed to discharge his burden. Respondent
relies on the alleged negligence of the Master in ordering the conduct of the drill and argues
that Simon could not have written a suicide note because of the proximity of the time when
the drill was conducted and the time when Simon jumped overboard. Respondent presented
no proof that said suicide note was fabricated, as no specimen of Simon's handwriting was
submitted to prove that it was not written by him.

On the contrary, the Court shares the observation of the LA that the signature in the suicide
note and the signature of Simon in his employment contract appear to be the same.
Hence, by substantial evidence, there are adequate reasons and proof that Simon
committed suicide.
Under Section 20(D) of the POEA SEC, no compensation or benefits shall arise in case of
death of a seafarer resulting from his willful act, provided that the employer could prove that
such death is attributable to the seafarer.
Although Simon died during the term of his contract with petitioners, still, respondent is not
entitled to receive benefits arising from his death. As clearly established, Simon died by his
willful act of committing suicide and death under that circumstance is not compensable
under the POEA SEC.
19.

Reynaldo Inutan vs. Napar Contracting, G. R. No. 195654, November 25, 2015

We, likewise, subscribe to LA Espiritu's ruling that petitioners, as regular employees, are
deemed to have been constructively and illegally dismissed by respondents. Being on
floating status and off-detailed for more than six months, not having been reinstated and
reassigned by respondents, petitioners are considered to have been constructively
dismissed. Settled is the rule that an employee who is unjustly dismissed from work shall be
entitled to reinstatement, or separation pay if reinstatement is no longer viable, and to his full
backwages.
LA Espiritu awarded petitioners separation pay in lieu of reinstatement. The Court agrees
that the award of separation pay is warranted due to the already strained relations between
the parties. However, aside from separation pay, petitioners, for having been illegally
dismissed, should also be awarded full backwages, inclusive of allowances and their other
benefits or their monetary equivalent computed from November 9, 2002 (the date of their
last work assignment or from the time compensation was withheld from them) up to the date
of finality of this Decision.
While petitioners failed to raise the matter of entitlement to backwages before the CA, this
does not prevent the Court from considering their entitlement to the same. The Court has
discretionary authority to take up new issues on appeal if it finds that their consideration is
necessary in arriving at a just decision.
Anent the other monetary claims in petitioners' complaints, the awards granted to them by
LA Espiritu stand undisturbed for petitioners' failure to question the same on appeal before
the CA and even before this Court. Hence, we sustain the award of wage differentials, 13th
month pay differentials, service incentive leave pay, unpaid ECOLA, and holiday pay less the
P7;000.00 already received by them.
20.

Radar Quillopa vs. Quality Guard Services, G. R. No. 213814, December 3, 2015

On the issue of constructive dismissal, the LA and the NLRC correctly ruled in favor of the
petitioner.
Case law provides that the concept of temporary "off-detail" or "floating status" of security
guards employed by private security agencies - a form of a temporary retrenchment or layoff - relates to the period of time when security guards are in between assignments or when
they are made to wait after being relieved from a previous post until they are transferred to a
new one. This takes place when the security agency's clients decide not to renew their
contracts with the agency, resulting in a situation where the available posts under its existing

contracts are less than the number of guards in its roster. It also happens in instances where
contracts for security services stipulate that the client may request the agency for the
replacement of the guards assigned to it, even for want of cause, such that the replaced
security guard may be placed on temporary "off-detail" if there are no available posts under
the agency's existing contracts. As the circumstance is generally outside the control of the
security agency or employer, the Court has ruled that when a security guard is placed on a
"floating status," he or she does not receive any salary or financial benefit provided by law.
To clarify, placing a security guard in temporary "off-detail" or "floating status" is part of
management prerogative of the employer-security agency and does not, per se, constitute a
severance of the employer-employee relationship. However, being an exercise of
management prerogative, it must be exercised in good faith - that is, one which is intended
for the advancement of the employer's interest and not for the purpose of defeating or
circumventing the rights of the employees under special laws or under valid agreements.
Moreover, due to the grim economic consequences to the security guard in which he does
not receive any salary while in temporary "off-detail" or "floating status," the employersecurity agency should bear the burden of proving that there are no posts available to which
the security guard temporarily out of work can be assigned. Furthermore, the security guard
must not remain in such status for a period of more than six (6) months; otherwise, he is
deemed terminated. The Court's ruling in Nationwide Security and Allied Services, Inc. v.
Valderama is instructive on this matter, to wit:
In cases involving security guards, a relief and transfer order in itself does not sever
employment relationship between a security guard and his agency. An employee has the
right to security of tenure, but this does not give him a vested right to his position as would
deprive the company of its prerogative to change his assignment or transfer him where his
service, as security guard, will be most beneficial to the client. Temporary off-detail or the
period of time security guards are made to wait until they are transferred or assigned to a
new post or client does not constitute constructive dismissal, so long as such status does not
continue beyond six months.
The onus of proving that there is no post available to which the security guard can be
assigned rests on the employer x x x. (Emphases and underscoring supplied)
In the case at bar, it is undisputed that from September 28, 2010 until he filed the Second
Complaint on September 14, 2011, or a total of more than 11 months, petitioner was placed
on a temporary "off-detail" or "floating status" without any salary or benefits whatsoever. In
fact, despite repeated follow-ups at the QGSIA Office, he failed to get a new post or
assignment from respondents purportedly for lack of vacancy. However, records are bereft of
any indication or proof that there was indeed no posts available to which petitioner may be
assigned. Therefore, in view of their unjustified failure to place petitioner back in active duty
within the allowable six (6)-month period and to discharge the burden placed upon it by
prevailing jurisprudence, the Court is constrained to hold respondents liable for petitioner's
constructive dismissal.
21.

Smart Communications vs. Jose Leni Solidum, G. R. No. 197763, December 7, 2015

The relevant provisions regarding preventive suspensions are found in Sections 8 and 9 of
Rule XXIII, Book V of the Omnibus Rules Implementing the Labor Code (Omnibus Rules), as
amended by Department Order No. 9, Series of 1997, which read as follows:
Section 8. Preventive suspension. The employer may place the worker concerned under
preventive suspension only if his continued employment poses a serious and imminent
threat to the life or property of the employer or of his co-workers.

Section 9. Period of suspension. No preventive suspension shall last longer than thirty (30)
days. The employer shall thereafter reinstate the worker in his former or in a substantially
equivalent position or the employer may extend the period of suspension provided that
during the period of extension, he pays the wages and other benefits due to the worker. In
such case, the worker shall not be bound to reimburse the amount paid to him during the
extension if the employer decides, after completion of the hearing, to dismiss the worker,
(Emphasis supplied)
By a preventive suspension an employer protects itself from further harm or losses because
of the erring employee. This concept was explained by the Court in Gatbonton v. National
Labor Relations Commission:
Preventive suspension is a disciplinary measure for the protection of the company's property
pending investigation of any alleged malfeasance or misfeasance committed by the
employee. The employer may place the worker concerned under preventive suspension if
his continued employment poses a serious and imminent threat to the life or property of the
employer or of his co-workers. However, when it is determined that there is no sufficient
basis lo justify an employee's preventive suspension, the latter is entitled to the payment of
salaries during the time of preventive suspension. (Emphasis supplied)
Such principle was applied by the Court in Bluer Than Blue Joint Ventures/Mary Ann Dela
Vega v. Esteban, where it was ruled:
Preventive suspension is a measure allowed by law and afforded to the employer if an
employee's continued employment poses a serious and imminent threat to the employer's
life or property or of his co-workers. It may be legally imposed against an employee whose
alleged violation is the subject of an investigation.
In this case, the petitioner was acting well within its rights when it imposed a 10-day
preventive suspension on Esteban. While it may be that the acts complained of were
committed by Esteban almost a year before the investigation was conducted, still, it should
be pointed out that Esteban was performing functions that involve handling of the petitioner's
property and funds, and the petitioner had every right to protect its assets and operations
pending Esteban's investigation. (Emphasis supplied)
While the Omnibus Rules limits the period of preventive suspension to thirty (30) days, such
time frame pertains only to one offense by the employee. For an offense, it cannot go
beyond 30 days. However, if the employee is charged with another offense, then the
employer is entitled to impose a preventive suspension not to exceed 30 days specifically for
the new infraction. Indeed, a fresh preventive suspension can be imposed for a separate or
distinct offense. Thus, an employer is well within its rights to preventively suspend an
employee for other wrongdoings that may be later discovered while the first investigation is
ongoing.
As in this case, Smart was able to uncover other wrongdoings committed by Solidum during
the investigation for the initial charges against him. These newly discovered transgressions
would, thus, require an additional period to investigate. The first batch of offenses was
captured in the September 21, 2005 Notice to Explain issued by Smart. The notice covers
fraud or willful breach of trust in relation to transactions covered by Invoice No. 2921 and CE
No. 2005-533 as well as CE Nos. 2005-413, 2005-459, 2005-461, 2005-526, 2005-460,
2005-552 and 2005-527 that were noted by him. For these offenses, Solidum was issued a
preventive suspension without pay for 30 days.
On October 21, 2005, Smart, however, issued another notice to explain to Solidum this time
involving additional CEs: 2005-416, 2005-480, 2005-481, 2005-479, 2005-512, and 2005-

513. Solidum was again preventively suspended for twenty (20) days. The preventive
suspension of 20 days is not an extension of the suspension issued in relation to the
September 21, 2005 Notice to Explain but is a totally separate preventive suspension for the
October 21, 2005 Notice to Explain. As earlier pointed out, the transactions covered by the
30-day preventive suspension are different from that covered by the 20-day preventive
suspension. Such being the case the court a quo was incorrect when it treated said
suspension as an "extension" and, consequently, it is a miscue to award Solidum the
payment of back salaries and benefits corresponding to the 20-day preventive suspension of
Solidum.
As to the issues raised by Solidum in G.R. No. 197836, the same are bereft of merit.
22.

Enchanted Kingdom vs. Miguel Verzo, G. R. No. 209559, December 9, 2015

A probationary employee is one who, for a given period of time, is being observed and
evaluated to determine whether or not he is qualified for permanent employment. A
probationary appointment affords the employer an opportunity to observe the skill,
competence and attitude of a probationer. The word probationary, as used to describe the
period of employment, implies the purpose of the term or period. While the employer
observes the fitness, propriety and efficiency of a probationer, to ascertain whether he is
qualified for permanent employment, the probationer, at the same time, seeks to prove to the
employer that he has the qualifications to meet the reasonable standards for permanent
employment. The concept of probationary employment was, thus, introduced for the benefit
of the employer to provide him with ample time to observe and determine whether a newly
hired employee has the competence, ability and values necessary to achieve his objectives.
A probationary employee, like a regular employee, enjoys security of tenure. In cases of
probationary employment, however, aside from just or authorized causes of termination,
under Article 281 of the Labor Code, the probationary employee may also be terminated for
failure to qualify as a regular employee in accordance with the reasonable standards made
known by the employer to the employee at the time of the engagement. In summary, a
probationary employee may be terminated for any of the following: (a) a just; or (b) an
authorized cause; and (c) when he fails to qualify as a regular employee in accordance with
the reasonable standards prescribed by the employer.
Section 6(d), Rule I, Book VI of the Implementing Rules of the Labor Code provides that if
the employer fails to inform the probationary employee of the reasonable standards on
which his regularization would be based at the time of the engagement, then the said
employee shall be deemed a regular employee. Thus:
(d) In all cases of probationary employment, the employer shall make known to the
employee the standards under which he will qualify as a regular employee at the time of his
engagement. Where no standards are made known to the employee at that time, he shall be
deemed a regular employee.
In Abbott Laboratories v. Alcaraz the Court stated that when dealing with a probationary
employee, the employer is made to comply with two (2) requirements: first, the employer
must communicate the regularization standards to the probationary employee; and second,
the employer must make such communication at the time of the probationary employee's
engagement. If the employer fails to comply with either, the employee is deemed as a
regular and not a probationary employee.
An exception to the foregoing rule is when the job is self-descriptive, as in the case of maids,
cooks, drivers, or messengers.

Clearly from the above, Enchanted informed Verzo that he was being placed on probation.
Aside from the probationary nature of his employment, the agreement of the parties
specifically showed: the duration of such status; the benefits to which he was entitled once
regularized; and most importantly, the standard with which he must comply in order to be
regularized. To deserve regularization, he must be able to conduct "mechanical and
structural system assessments," as well as inspect and evaluate the "conditions, operations
and maintenance requirements of rides, facilities and buildings to ensure compliance with
applicable codes, regulations and standards." A detailed enumeration of his specific duties
accompanied this letter of employment to ensure that he was made aware and informed of
his duties and responsibilities.
Verzo makes much noise of the fact that the letter was not served upon him immediately at
the very start of his employment on August 19, 2009. Suffice it to state that Enchanted was
able to substantially comply with the requirement of the law in apprising him of the standards
for his regularization. Verily, the purpose of the law in requiring that an employee be notified
of the standards for his regularization during his probationary employment is to simply afford
him due process, so that the employee will be aware that he will be under close observation
and his performance of his assigned duties and functions would be under continuous
scrutiny by his superiors.
Moreover, while it may be argued that ideally employers should immediately inform a
probationary employee of the standards for his regularization from day one, strict
compliance thereof is not required. The true test of compliance with the requirements of the
law is, of course, one of reasonableness. As long as the probationary employee is given a
reasonable time and opportunity to be made fully aware of what is expected of him during
the early phases of the probationary period, the requirement of the law has been satisfied.
23.

Echo 2000 Commercial vs. Obrero Filipino, G. R. No. 214092, January 11, 2016

As to the extent of management prerogative to transfer/promote employees, and the

differences between transfer on one hand, and promotion, on the other, Coca-Cola Bottlers
Philippines, Inc. v. Del Villar is instructive, viz:
[L]abor laws discourage interference in employers' judgment concerning the conduct of their
business.
In the pursuit of its legitimate business interest, management has the prerogative to transfer
or assign employees from one office or area of operation to another - provided there is no
demotion in rank or diminution of salary, benefits, and other privileges; and the action is not
motivated by discrimination, made in bad faith, or effected as a form of punishment or
demotion without sufficient cause. xx x.
x x x In the case of Blue Dairy Corporation v. National Labor Relations Commission, we
described in more detail the limitations on the right of management to transfer employees:
x x x [I]t cannot be used as a subterfuge by the employer to rid himself of an undesirable
worker. In particular, the employer must be able to show that the transfer is not
unreasonable, inconvenient or prejudicial to the employee; nor does it involve a demotion in
rank or a diminution of his salaries, privileges and other benefits. xxx.
xxxx
A transfer is a movement from one position to another which is of equivalent rank, level or
salary, without break in service. Promotion, on the other hand, is the advancement from one
position to another with an increase in duties and responsibilities as authorized by law, and

usually accompanied by an increase in salary. Conversely, demotion involves a situation

where an employee is relegated to a subordinate or less important position constituting a
reduction to a lower grade or rank, with a corresponding decrease in duties and
responsibilities, and usually accompanied by a decrease in salary. (Citations omitted and
emphasis and underscoring ours)
For promotion to occur, there must be an advancement from one position to another or an
upward vertical movement of the employee's rank or position. Any increase in salary should
only be considered incidental but never determinative of whether or not a promotion is
bestowed upon an employee.
An employee is not bound to accept a promotion, which is in the nature of a gift or reward.
Refusal to be promoted is a valid exercise of a right. Such exercise cannot be considered in
law as insubordination, or willful disobedience of a lawful order of the employer, hence, it
cannot be the basis of an employee's dismissal from service.
In the case at bench, a Warehouse Checker and a Forklift Operator are rank-and-file
employees. On the other hand, the job of a Delivery Supervisor/Coordinator requires the
exercise of discretion and judgment from time to time. Specifically, a Delivery
Supervisor/Coordinator assigns teams to man the trucks, oversees the loading of goods,
checks the conditions of the trucks, coordinates with account specialists in the outlets
regarding their delivery concerns, and supervises other personnel about their performance in
the warehouse. A Delivery Supervisor/Coordinator's duties and responsibilities are
apparently not of the same weight as those of a Warehouse Checker or Forklift Operator.
Hence, despite the fact that no salary increases were effected, the assumption of the post of
a Delivery Supervisor/Coordinator should be considered a promotion. The respondents'
refusal to accept the same was therefore valid.
24.

Lorelie Iladan vs. La Suerte International, G. R. No. 203882, January 11, 2016

In illegal dismissal cases, the employer has the burden of proving that the employee's
dismissal was legal. However, to discharge this burden, the employee must first prove, by
substantial evidence, that he had been dismissed from employment.
Iladan maintains that she was threatened and coerced by respondents to write the
resignation letter, to accept the financial assistance and to sign the waiver and settlement.
Consequently, she Insists that her act of resigning was involuntary.
The Court is not convinced as we find no proof of Iladan's allegations. It is a settled
jurisprudence that it is incumbent upon an employee to prove that his resignation is not
voluntary. However, Iladan did not adduce any competent evidence to prove that
respondents used force and threat.
For intimidation to vitiate consent, the following requisites must be present; (1) that the
intimidation paused the consent to be given; (2) that the threatened act be unjust or
unlawful; (3) that the threat be real or serious, there being evident disproportion between the
evil and the resistance which all men can offer, leading to the choice of doing the act which
is forced on the person to do as the lesser evil; and (4) that it produces a well-grounded fear
from the fact that the person from whom it comes has the necessary means or ability to
inflict the threatened injury to his person or property. In the instant case, not one of these
essential elements was amply proven by [Iladan]. Bare allegations of threat or force do not
constitute substantial evidence to support a finding of forced resignation.
Resignation is the voluntary act of an employee who is in a situation where one believes that
personal reasons cannot be sacrificed in favor of the exigency of the service, and one has

no other choice but to dissociate oneself from employment. It is a formal pronouncement or

relinquishment of an office, with the intention of relinquishing the office accompanied by the
act of relinquishment. As the intent to relinquish must concur with the overt act of
relinquishment, the acts of the employee before and after the alleged resignation must be
considered in determining whether in fact, he or she intended to sever from his or her
employment.
In the instant case, Iladan executed a resignation letter in her own handwriting. She also
accepted the amount of P35,000.00 as financial assistance and executed an Affidavit of
Release, Waiver and Quitclaim and an Agreement, as settlement and waiver of any cause of
action against respondents. The affidavit of waiver and the settlement were
acknowledged/subscribed before Labor Attache Romulo on August 6, 2009, and duly
authenticated by the Philippine Consulate. An affidavit of waiver duly acknowledged before a
notary public is a public document which cannot be impugned by mere self-serving
allegations. Proof of an irregularity in its execution is absolutely essential. The Agreement
likewise bears the signature of Conciliator-Mediator Diaz. Thus, the signatures of these
officials sufficiently prove that Iladan was duly assisted when she signed the waiver and
settlement. Concededly, the presumption of regularity of official acts may be rebutted by
affirmative evidence of irregularity or failure to perform a duty. In this case, no such evidence
was presented. Besides, "[t]he Court has ruled that a waiver or quitclaim is a valid and
binding agreement between the parties, provided that it constitutes a credible and
reasonable settlement, and that the one accomplishing it has done so voluntarily and with a
full understanding of its import." Absent any extant and clear proof of the alleged coercion
and threats Iladan allegedly received from respondents that led her to terminate her
employment relations with respondents, it can be concluded that Iladan resigned voluntarily.
25.

Olympia Housing vs. Allan La Pastora, G. R. No. 187691, January 13, 2016

Indisputably, Lapastora was a regular employee of OHI. As found by the LA, he has been
under the continuous employ of OHI since March 3, 1995 until he was placed on floating
status in February 2000. His uninterrupted employment by OHI, lasting for more than a year,
manifests the continuing need and desirability of his services, which characterize regular
employment. Article 280 of the Labor Code provides as follows:
Art. 280. Regular and casual employment. The provisions of written agreement to the
contrary notwithstanding and regardless of the oral agreement of the parties, an employment
shall be deemed to be regular where the employee has been engaged to perform activities
which are usually necessary or desirable in the usual business or trade of the employer,
except where the employment has been fixed for a specific project or undertaking, the
completion or termination of which has been determined at the time of the engagement of
the employee or where the work or services to be performed is seasonal in nature and the
employment is for the duration of the season.
An employment shall be deemed to be casual if it is not covered by the preceding
paragraph: Provided, That, any employee who has rendered at least one year of service,
whether such service is continuous or broken, shall be considered a regular employee with
respect to the activity in which he is employed and his employment shall continue while such
activity exists.
Based on records, OHI is engaged in the business of managing residential and commercial
condominium units at the OER. By the nature of its business, it is imperative that it maintains
a pool of housekeeping staff to ensure that the premises remain an uncluttered place of
comfort for the occupants. It is no wonder why Lapastora, among several others, was
continuously employed by OHI precisely because of the indispensability of their services to

its business. The fact alone that Lapastora was allowed to work for an unbroken period of
almost five years is all the same a reason to consider him a regular employee.
The attainment of a regular status of employment guarantees the employee's security of
tenure that he cannot be unceremoniously terminated from employment. "To justify fully the
dismissal of an employee, the employer must, as a rule, prove that the dismissal was for a
just cause and that the employee was afforded due process prior to dismissal. As a
complementary principle, the employer has the onus of proving with clear, accurate,
consistent, and convincing evidence the validity of the dismissal."
26.

Cebu Peoples Coop vs. Nicerato Carbonilla, G. R. No. 212070, January 27, 2016

Basic is the rule that an employer may validly terminate the services of an employee for any
of the just causes enumerated under Article 296 (formerly Article 282) of the Labor Code,
namely:
(a) Serious misconduct or willful disobedience by the employee of the lawful orders of his
employer or representative in connection with his work;
(b) Gross and habitual neglect by the employee of his duties;
(c) Fraud or willful breach by the employee of the trust reposed in him by his employer or
duly authorized representative;
(d) Commission of a crime or offense by the employee against the person of his employer or
any immediate member of his family or his duly authorized representatives; and
(e) Other causes analogous to the foregoing.
As may be gathered from the tenor of CPMPC's Notice of Dismissal, it is apparent that
Carbonilla, Jr.'s employment was terminated on the grounds of, among others, serious
misconduct and loss of trust and confidence.
On the first ground, case law characterizes misconduct as a 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 in judgment. For misconduct to be
considered as a just cause for termination, the following requisites must concur: (a) the
misconduct must be serious; (b) it must relate to the performance of the employee's duties
showing that the employee has become unfit to continue working for the employer; and (c) it
must have been performed with wrongful intent.
For another, Carbonilla, Jr.'s dismissal was also justified on the ground of loss of trust and
confidence. According to jurisprudence, loss of trust and confidence will validate an
employee's dismissal when it is shown that: (a) the employee concerned holds a position of
trust and confidence; and (b) he performs an act that would justify such loss of trust and
confidence. There are two (2) classes of positions of trust: first, managerial employees
whose primary duty consists of the management of the establishment in which they are
employed or of a department or a subdivision thereof, and to other officers or members of
the managerial staff; and second, fiduciary rank-and-file employees, such as cashiers,
auditors, property custodians, or those who, in the normal exercise of their functions,
regularly handle significant amounts of money or property. These employees, though rankand-file, are routinely charged with the care and custody of the employer's money or
property, and are thus classified as occupying positions of trust and confidence.
27.

Manila Memorial Park vs. Ezard Lluz, G. R. No. 208451, February 3, 2016

In order to determine whether there exists an employer-employee relationship between

Manila Memorial and respondents, relevant provisions of the labor law and rules must first
be reviewed. Article 106 of the Labor Code states:
Art. 106. Contractor or subcontractor. Whenever an employer enters into a contract with
another person for the performance of the former's work, the employees of the contractor
and of the latter's subcontractor, if any, shall be paid in accordance with the provisions of this
Code.
In the event that the contractor or subcontractor fails to pay the wages of his employees in
accordance with this Code, the employer shall be jointly and severally liable with his
contractor or subcontractor to such employees to the extent of the work performed under the
contract, in the same manner and extent that he is liable to employees directly employed by
him.
The Secretary of Labor and Employment may, by appropriate regulations, restrict or prohibit
the contracting-out of labor to protect the rights of workers established under this Code. In so
prohibiting or restricting, he may make appropriate distinctions between labor-only
contracting and job contracting as well as differentiations within these types of contracting
and determine who among the parties involved shall be considered the employer for
purposes of this Code, to prevent any violation or circumvention of any provision of this
Code.
There is "labor-only" contracting where the person supplying workers to an employer does
not have substantial capital or investment in the form of tools, equipment, machineries, work
premises, among others, and the workers recruited and placed by such person are
performing activities which are directly related to the principal business of such employer. In
such cases, the person or intermediary shall be considered merely as an agent of the
employer who shall be responsible to the workers in the same manner and extent as if the
latter were directly employed by him. (Emphasis supplied)
Labor-only contracting exists when the contractor or subcontractor merely recruits, supplies
or places workers to perform a job, work or service for a principal and any of the following
elements are present:
1) The contractor or subcontractor does not have substantial capital or investment which
relates to the job, work or service to be performed and the employees recruited, supplied or
placed by such contractor or subcontractor are performing activities which are directly
related to the main business of the principal; or
2) The contractor does not exercise the right to control the performance of the work of the
contractual employee.
In the present case, Manila Memorial entered into a Contract of Services with Ward Trading,
a single proprietorship owned by Emmanuel Mayor Ward with business address in Las Pias
City on 23 February 2006. In the Contract of Services, it was provided that Ward Trading, as
the contractor, had adequate workers and substantial capital or investment in the form of
tools, equipment, machinery, work premises and other materials which were necessary in
the conduct of its business.
28.
2016

C. F. Sharp Crew vs. Heirs of Godofredo Repiso, G. R. No. 190534, February 10,

As a rule, stipulations in an employment contract not contrary to statutes, public policy,

public order or morals have the force of law between the contracting parties. In controversies
between a laborer and his master, doubts reasonably arising from the evidence or in the
interpretation of agreements and writing should be resolved in the former's favor. The policy
is to extend the doctrine to a greater number of employees who can avail of the benefits
under the law, in consonance with the avowed policy of the State, under Article XIII, Section
3 of the 1987 Constitution, to give maximum aid and protection to labor. Consistent with this
policy, the POEA-SEC was designed primarily for the protection and benefit of Filipino
seafarers in the pursuit of their employment on board ocean-going vessels. As such., it is a
standing principle that its provisions are to be construed and applied fairly, reasonably, and
liberally in their favor.
For a seafarer's death to be compensable under the 1996 POEA-SEC, the Court explicitly
ruled in Inter-Orient Maritime, Inc. v. Candava that:
The prevailing rule under the 1996 POEA-SEC was that the illness leading to the eventual
death of seafarer need not be shown to be work-related in order to be compensable, but
must be proven to have been contracted during the term of the contract. Neither is it
required that there be proof that the working conditions increased the risk of contracting the
disease or illness. An injury or accident is said to arise "in the course of employment" when it
takes place within the period of employment, at a place where the employee reasonably may
be, and while he is fulfilling his duties or is engaged in doing something incidental thereto.
(Emphases supplied, citations omitted.)
Based on the foregoing, herein respondents are entitled to the benefits they are claiming as
it can be logically and reasonably concluded from the particular circumstances in the case at
bar that Godofredo contracted the illness which eventually caused his death during the term
of his contract or in the course of his employment.
Respondents alleged, and petitioners did not refute, that Godofredo's employment with
petitioner C.F. Sharp started way back in 1990. From then until his last employment with
petitioner C.F. Sharp in 2002-2003, there was no record of him suffering from hypertension
and/or heart disease. Before Godofredo boarded M/T Umm Al Lulu on May 20, 2002, he
underwent PEME and was declared fit to work. This negates petitioners' claim that
Godofredo concealed a pre-existing illness. It is true that the Court had previously declared
that the PEME could not be relied upon to inform the employer/s of a seafarer's true state of
health, and there were instances when the PEME could not have divulged the seafarer's
illness considering that the examinations were not exploratory. Even so, as Labor Arbiter
Anni and the Court of Appeals observed in the instant case, Godofredo's hypertension
and/or heart disease could have been easily detected by standard/routine tests included in
the PEME, i.e., blood pressure test, electrocardiogram, chest x-ray, and/or blood chemistry.
Godofredo had no previous record of hypertension and/or heart disease before he boarded
M/T Umm Al Lulu on May 20, 2002; but when he was repatriated at a port in Manila on
March 16, 2003 and examined by Dr. Reyes on March 17, 2003, he was already diagnosed
to be suffering from "Essential Hypertension." On March 19, 2003, just three days after his
repatriation, Godofredo died and the underlying cause for his death was identified as
"Hypertensive Heart Disease." Taking into account these circumstances, the Court is
convinced that Godofredo contracted hypertension and/or heart disease during his term of
employment with petitioners beginning May 20, 2002 until his repatriation on March 16,
2003. In contrast, the Court is not swayed by petitioners' contention that the 10-month period
was too short for Godofredo to have developed his illness, which was totally
unsubstantiated.
29.

Cadiz vs. Breny Hospital and Colleges, G. R. No. 187417, February 24, 2016

Both the LA and the NLRC upheld Cadiz's dismissal as. one attended with just cause. The
LA, while ruling that Cadiz's indefinite suspension was tantamount to a constructive
dismissal, nevertheless found that there was just cause for her dismissal. According to the
LA, "there was just cause therefor, consisting in her engaging in premarital sexual relations
with Carl Cadiz, allegedly her boyfriend, resulting in her becoming pregnant out of wedlock."
The LA deemed said act to be immoral, which was punishable by dismissal under Brent's
rules and which likewise constituted serious misconduct under Article 282(a) of the Labor
Code. The LA also opined that since Cadiz was Brent's Human Resource Officer in charge
of implementing its rules against immoral conduct, she should have been the "epitome of
proper conduct." The LA ruled:
[Cadiz's] immoral conduct by having premarital sexual relations with her alleged boy friend, a
former Brent worker and her co-employee, is magnified as serious misconduct not only by
her getting pregnant as a result thereof before and without marriage, but more than that,
also by the fact that Brent is an institution of the Episcopal Church in the Philippines xxx
committed to "developing competent and dedicated professionals xxx and in providing
excellent medical and other health services to the community for the Glory of God and
Service to Humanity." x x x As if these were not enough, [Cadiz] was Brent's Human
Resource Officer charged with, among others, implementing the rules of Brent against
immoral conduct, including premarital sexual relations, or fornication xxx. She should have
been the epitome of proper conduct, but miserably failed. She herself engaged in premarital
sexual relations, which surely scandalized the Brent community, x x x.
Thus, the question that must be resolved is whether Cadiz's premarital relations with her
boyfriend and the resulting pregnancy out of wedlock constitute immorality. To resolve this,
the Court makes reference to the recently promulgated case of Cheryll Santos Lens v. St.
Scholastica 's College Westgrove and/or Sr. Edna Quiambao, OSB.
In this case, the surrounding facts leading to Cadiz's dismissal are straightforward - she was
employed as a human resources officer in an educational and medical institution of the
Episcopal Church of the Philippines; she and her boyfriend at that time were both single;
they engaged in premarital sexual relations, which resulted into pregnancy. The labor
tribunals characterized these as constituting disgraceful or immoral conduct. They also
sweepingly concluded that as Human Resource Officer, Cadiz should have been the
epitome of proper conduct and her indiscretion "surely scandalized the Brent community."
The foregoing circumstances, however, do not readily equate to disgraceful and immoral
conduct. Brent's Policy Manual and Employee's Manual of Policies do not define what
constitutes immorality; it simply stated immorality as a ground for disciplinary action. Instead,
Brent erroneously relied on the standard dictionary definition of fornication as a form of illicit
relation and proceeded to conclude that Cadiz's acts fell under such classification, thus
constituting immorality.
Jurisprudence has already set the standard of morality with which an act should be gauged it is public and secular, not religious.40 Whether a conduct is considered disgraceful or
immoral should be made in accordance with the prevailing norms of conduct, which, as
stated in Leus, refer to those conducts which are proscribed because they are detrimental to
conditions upon which depend the existence and progress of human society. The fact that a
particular act does not conform to the traditional moral views of a certain sectarian institution
is not sufficient reason to qualify such act as immoral unless it, likewise, does not conform to
public and secular standards. More importantly, there must be substantial evidence to
establish that premarital sexual relations and pregnancy out of wedlock is considered
disgraceful or immoral.

The totality of the circumstances of this case does not justify the conclusion that Cadiz
committed acts of immorality. Similar to Leus, Cadiz and her boyfriend were both single and
had no legal impediment to marry at the time she committed the alleged immoral conduct. In
fact, they eventually married on April 15, 2008. Aside from these, the labor tribunals'
respective conclusion that Cadiz's "indiscretion" "scandalized the Brent community" is
speculative, at most, and there is no proof adduced by Brent to support such sweeping
conclusion. Even Brent admitted that it came to know of Cadiz's "situation" only when her
pregnancy became manifest. Brent also conceded that "[a]t the time [Cadiz] and Carl R.
Cadiz were just carrying on their boyfriend-girlfriend relationship, there was no knowledge or
evidence by [Brent] that they were engaged also in premarital sex." This only goes to show
that Cadiz did not flaunt her premarital relations with her boyfriend and it was not carried on
under scandalous or disgraceful circumstances. As declared in Leus, "there is no law which
penalizes an unmarried mother by reason of her sexual conduct or proscribes the
consensual sexual activity between two unmarried persons; that neither does such situation
contravene[s] any fundamental state policy enshrined in the Constitution." The fact that
Brent is a sectarian institution does not automatically subject Cadiz to its religious standard
of morality absent an express statement in its manual of personnel policy and regulations,
prescribing such religious standard as gauge as these regulations create the obligation on
both the employee and the employer to abide by the same.
30.

Silvertex Weaving vs. Teodora Campo, G. R. No. 211411, March 16, 2016

The Court underscores the petitioners' insistent claim that the respondent was not
dismissed, but had voluntarily resigned from employment with STWC. The respondent, on
the other hand, consistently and vehemently denied the genuineness of the signatures in the
two subject documents presented by the petitioners. She likewise denied any intention to
sever her employment with the company.
Anent the foregoing circumstances, it is well-settled by jurisprudence that in labor cases,
"the employer has the burden of proving that the employee was not dismissed, or, if
dismissed, that the dismissal was not illegal." The NLRC's pronouncement that it was
incumbent upon the respondent to dispute the genuineness of her signature on the
resignation letter was then clearly misplaced. As the Court emphasized in San Miguel
Properties Philippines, Inc. v. Gucaban:
Resignation - the formal pronouncement or relinquishment of a position or office - is the
voluntary act of an employee who is in a situation where he believes that personal reasons
cannot be sacrificed in favor of the exigency of the service, and he has then no other choice
but to disassociate himself from employment. The intent to relinquish must concur with the
overt act of relinquishment; hence, the acts of the employee before and after the alleged
resignation must be considered in determining whether he in fact intended to terminate his
employment. In illegal dismissal cases, fundamental is the rule that when an employer
interposes the defense of resignation, on him necessarily rests the burden to prove that the
employee indeed voluntarily resigned. x x x.23 (Citations omitted and emphasis ours)
The petitioners attempted to discharge the burden of proving the respondent's resignation by
referring mainly to a letter allegedly executed by the respondent. The CA, however, correctly
explained that the NLRC's reliance thereon and on the QDR from the PNP Crime Laboratory
to prove the letter's authenticity was unsatisfactory. In contrast with the NLRC's conclusion in
its Resolution dated March 19, 2012 that the respondent actually executed the resignation
letter, the full report of the PNP Crime Laboratory actually indicated that the signature
appearing on the alleged resignation letter did not appear to be written by the same person
who signed the several payroll slips and Philhealth records, respectively marked as "S-l" to
"S-14" and "S-15" to "S-17", that were submitted by the petitioners as reference on the
respondent's true handwriting.