LABOR RELATIONS

Interpretation and application of labor laws

PNCC Skyway Traffic Management and Security

Division Workers Organization v. PNCC Skyway Corp., G.R.
No. 171231, February 17, 2010

The rule is that where the language of a contract is plain

and unambiguous, its meaning should be determined
without reference to extrinsic facts or aids. The intention of
the parties must be gathered from that language, and from
that language alone. Stated differently, where the language
of a written contract is clear and unambiguous, the contract
must be taken to mean that which, on its face, it purports to
mean, unless some good reason can be assigned to show
that the words used should be understood in a different
sense.

In the case at bar, the contested provision of the CBA is

clear and unequivocal. Article VIII, Section 1 (b) of the CBA
categorically provides that the scheduling of vacation
leave shall be under the option of the employer. The
preference requested by the employees is not controlling
because respondent retains its power and prerogative to
consider or to ignore said request.

Social Justice

PLDT v. NLRC, G.R. No. 80609, August 23, 1988,

En Banc

There should be no question that where it comes to such

 valid but not iniquitous causes as failure to comply with work
standards, the grant of separation pay to the dismissed
employee may be both just and compassionate, particularly
if he has worked for some time with the company. For
example, a subordinate who has irreconcilable policy or
personal differences with his employer may be validly
dismissed for demonstrated loss of confidence, which is an
allowable ground. A working mother who has to be
frequently absent because she has also to take care of her
child may also be removed because of her poor attendance,
this being another authorized ground. It is not the
employee's fault if he does not have the necessary aptitude
for his work but on the other hand the company cannot be
required to maintain him just the same at the expense of the
efficiency of its operations. He too may be validly replaced.
Police Power
Philippine Association of Service Exporters, Inc. v.
Drilon, G.R. No. 81958, June 30, 1988, En Banc

[Police power] has been defined as the "state authority to

enact legislation that may interfere with personal liberty or
property in order to promote the general welfare." As
defined, it consists of (1) an imposition of restraint upon
liberty or property, (2) in order to foster the common good.
It is not capable of an exact definition but has been,
purposely, veiled in general terms to underscore its all-
comprehensive embrace.

The petitioner has shown no satisfactory reason why

the contested measure should be nullified. There is no
question that Department Order No. 1 applies only to
"female contract workers," but it does not thereby make an
undue discrimination between the sexes. It is well-settled
 that "equality before the law" under the Constitution does
not import a perfect Identity of rights among all men and
women. It admits of classifications, provided that (1) such
classifications rest on substantial distinctions; (2) they are
germane to the purposes of the law; (3) they are not
confined to existing conditions; and (4) they apply equally to
all members of the same class.

LABOR RELATIONS LAW

Right to Self-Organization

Samahan ng Manggagawa sa Hanjin Shipyards v.

BLR, et. al., G.R. No. 211145, October 14, 2015

Section 3 Constitution states that the State shall afford full

protection to labor, local and overseas, organized and
unorganized, and promote full employment and equality of
employment opportunities for all. It shall guarantee the
rights of all workers to self-organization, collective
bargaining and negotiations, and peaceful concerted
activities, including the right to strike in accordance with
law. In view of the revered right of every worker to self-
organization, the law expressly allows and even encourages
the formation of labor organizations. A labor organization is
defined as "any union or association of employees which
exists in whole or in part for the purpose of collective
bargaining or of dealing with employers concerning terms
and conditions of employment. A union refers to any labor
organization in the private sector organized for collective
bargaining and for other legitimate purpose, while a workers'
 association is an organization of workers formed for the
mutual aid and protection of its members or for any
legitimate purpose other than collective bargaining.
Collective bargaining is just one of the forms of employee
participation. Despite so much interest in and the promotion
of collective bargaining, it is incorrect to say that it is the
device and no other, which secures industrial democracy. It
is equally misleading to say that collective bargaining is the
end-goal of employee representation. Rather, the real aim
is employee participation in whatever form it may appear,
bargaining or no bargaining, union or no union. Any labor
organization which may or may not be a union may deal
with the employer. This explains why a workers' association
or organization does not always have to be a labor union
and why employer-employee collective interactions are not
always collective bargaining.

FEU-Dr. Reyes Medical Foundation Inc. vs.

Trajano, G.R. No. 76273, July 31, 1987

Under the Coverage and Employees right to self-

organization provision, there is no doubt that rank and file
employees of non-profit medical institutions (as herein
petitioner) are now permitted to form, organize or join labor
unions of their choice for purposes of collective bargaining.
Since private respondent had complied with the requisites
provided by law for calling a certification election, it was
incumbent upon respondent Director to conduct such
certification election to ascertain the bargaining
representative of petitioner's employees.

NUWHRAIN Manila Pavilion Chapter vs. Sec. of

Labor, G.R. No. 181531, July 31, 2009
 " Collective bargaining covers all aspects of the employment
relation and the resultant CBA negotiated by the certified
union binds all employees in the bargaining unit. Hence, all
rank and file employees, probationary or permanent, have a
substantial interest in the selection of the bargaining
representative. The Code makes no distinction as to their
employment status as basis for eligibility in supporting the
petition for certification election. The law refers to "all" the
employees in the bargaining unit. All they need to be eligible
to support the petition is to belong to the "bargaining unit".

Franklin Baker Co. vs. Trajano, G.R. No. 75039, January

28, 1988

The test of "supervisory" or "managerial status" depends on

whether a person possesses authority to act in the interest
of his employer in the matter specified in Article 212 (k) of
the Labor Code and Section 1 (m) of its Implementing Rules
and whether such authority is not merely routinary or clerical
in nature, but requires the use of independent judgment.
Thus, where such recommendatory powers as in the case at
bar, are subject to evaluation, review and final action by the
department heads and other higher executives of the
company, the same, although present, are not effective and
not an exercise of independent judgment as required by law.
Furthermore, in line with the ruling of this Court, subject
employees are not managerial employees because as borne
by the records, they do not participate in policy making but
are given ready policies to execute and standard practices to
observe, thus having little freedom of action.

Meralco vs. Sec. of Labor, G.R. No. 91902, May 20,

 1991

On December 24, 1986, Pres. Corazon C. Aquino issued E.O.

No. 111 which eliminated the above-cited provision on the
disqualification of security guards. What was retained was
the disqualification of managerial employees, renumbered as
Art. 245 (previously Art. 246), Art. 245. Ineligibility of
managerial employees to joint any labor organization.
Managerial employees are not eligible to join, assist or form
any labor organization. With the elimination, security guards
were thus free to join a rank and file organization

WHO CANNOT (Right to Self Organization)

Metrolab Industries vs Confessor, G.R. No. 108855,

February 28, 1996

By recognizing the expanded scope of the right to self-

organization, the intent of the court was to delimit the types
of employees excluded from the close shop provisions, not
from the bargaining unit. The executive secretaries of
General Manager and the Management Committees should
not only be exempted from the closed-shop provision but
should not be permitted to join in the bargaining unit of the
rank and file employees as well as on the grounds that the
executive secretaries are confidential employees , having
access to vital labor information.

Penaranda vs BagangaPlywood Corp., G.R. No. 159577,

May 3, 2006

Article 82 of the Labor Code exempts managerial employees

 from the coverage of labor standards. Labor standards
provide the working conditions of employees, including
entitlement to overtime pay and premium pay for working
on rest days. Under this provision, managerial employees
are "those whose primary duty consists of the management
of the establishment in which they are employed or of a
department or subdivision."Petitioner supervised the
engineering section of the steam plant boiler. His work
involved overseeing the operation of the machines and the
performance of the workers in the engineering section. This
work necessarily required the use of discretion and
independent judgment to ensure the proper functioning of
the steam plant boiler. As supervisor, petitioner is deemed a
member of the managerial staff.

United Pepsi-Cola Supervisory Union (UPSU) v.

Laguesma, G.R. No. 122226, March 25, 1998

A distinction exists between those who have the authority to

devise, implement and control strategic and operational
policies (top and middle managers) and those whose task is
simply to ensure that such policies are carried out by the
rank-and-file employees of an organization (first-level
managers/supervisors). What distinguishes them from the
rank-and-file employees is that they act in the interest of the
employer in supervising such rank-and-file employees.
To qualify as managerial employee, there must be a clear
showing of the exercise of managerial attributes under
paragraph (m), Article 212 of the Labor Code as amended.
Designations or titles of positions are not controlling.

Tagaytay Highlands International Golf Club vs.

Tagaytay Highlands Employees Union-PGTWO, G.R. No.
 142000, January 22, 2003

The grounds for cancellation of union registration are

provided for under Article 239 of the Labor Code and the
inclusion in a union of disqualified employees is not among
the grounds for cancellation, unless such inclusion is due to
misrepresentation, false statement or fraud under the
circumstances enumerated in Sections (a) and (c) of Article
239 of above-quoted Article 239 of the Labor Code.

Coca-Cola Bottlers Philippines, Inc., v. Ilocos

Professional and Technical Employees Union (IPTEU), G.R.
No. 193798, September 9, 2015

Access to vital labor information is the imperative

consideration in determining whether or not an employee is
a confidential employee. An employee must assist or act in a
confidential capacity and obtain confidential information
relating labor relations policies. Exposure to internal business
operations of the company is not per se a ground for the
exclusion in the bargaining unit.
Benguet Electric Cooperatives Inc. vs. Calleja, G.R. No.
79025, December 29, 1989

The fact that the members-employees of petitioner do not

participate in the actual management of the cooperative
does not make them eligible to form, assist or join a labor
organization for the purpose of collective bargaining with
petitioner. The Court's ruling in the Davao City case that
members of cooperative cannot join a labor union for
purposes of collective bargaining was based on the fact that
as members of the cooperative they are co-owners thereof.
As such, they cannot invoke the right to collective bargaining
 for "certainly an owner cannot bargain with himself or his
co-owners."

Central Negros vs. Sec. of Labor, G.R. No. 94045,

September 13, 1991

Membership in an electric cooperative which merely vests in

the member a right to vote during the annual meeting
becomes too trivial and insubstantial vis-a-vis the primordial
and more important constitutional right of an employee to
join a union of his choice. Besides, the 390 employees of
CENECO, some of whom have never been members of the
cooperative, represent a very small percentage of the
cooperative's total membership of 44,000. It is inconceivable
how the withdrawal of a negligible number of members
could adversely affect the business concerns and operations
of CENECO.

Scope of the Right to Self Organization

Reyes vs. Trajano, G.R. No. 84433, June 2,

1992

The right to form or join a labor organization necessarily

includes the right to refuse or refrain from exercising said
right. It is self-evident that just as no one should be denied
the exercise of a right granted by law, so also, no one
should be compelled to exercise such a conferred right. The
fact that a person has opted to acquire membership in a
labor union does not preclude his subsequently opting to
renounce such membership
 Pan American World Airways Inc. vs. Pan
American EU, G.R. No. L-25094, April 29, 1969, En Banc

The greater offense is to the labor movement itself, more

specifically to the right of self-organization. There is both a
constitutional and statutory recognition that laborers have
the right to form unions to take care of their interests vis-a-
vis their employers.

UST Faculty Union vs. Bitonio, G.R. No.

131235, November 16, 1999

Self-organization is a fundamental right guaranteed by the

Constitution and the Labor Code. Corollary to this right is the
prerogative not to join, affiliate with or assist a labor union.
Therefore, to become a union member, an employee must
not only signify the intent to become one, but also take
some positive steps to realize that intent. The procedure for
union membership is usually embodied in the unions CBL.
An employee who becomes a union member acquires the
rights and he concomitant obligations that go with the new
status and becomes bound by the unions rules and
regulations.

Labor Organizations

San Miguel Corporation Employees Union

(PTGWO) vs. San Miguel Packaging Products Employees
Union (PDMP), G.R. No. 171153, September 12, 2007

Labor Law; Labor Unions; Federations; Trade Union; There

is no legal justification to support the conclusion that a trade
union center is allowed to directly create a local or chapter
 through chartering.This Court reverses the finding of the
appellate court and BLR on this ground, and rules that PDMP
cannot directly create a local or chapter. After an exhaustive
study of the governing labor law provisions, both statutory
and regulatory, we find no legal justification to support the
conclusion that a trade union center is allowed to directly
create a local or chapter through chartering. Apropos, we
take this occasion to reiterate the first and fundamental duty
of this Court, which is to apply the law. The solemn power
and duty of the Court to interpret and apply the law does
not include the power to correct by reading into the law
what is not written therein.
Registration (Labor Organizations)
PAFLU vs. Sec. of Labor, G.R. No. L-22228,
February 27, 1969, En Banc

Constitutional law; Freedom of assembly and association;

Labor laws; Section 23 of Rep. Act 875 does not curtail
freedom of assembly and association.The theory to the
effect that section 23 of Republic Act No. 875 unduly curtails
the freedom of assembly and association guaranteed in the
Bill of Rights is devoid of factual basis. The registration
prescribed in paragraph (b) of said section is not a limitation
to the right of assembly or association, which may be
exercised with or without said registration. The latter is
merely a condition sine qua non for the acquisition of legal
personality by labor organizations, associations or unions
and the possession of the rights and privileges granted by
law to legitimate labor organizations. The Constitution does
not guarantee these rights and privileges, much less said
personality, which are mere statutory creations, for the
possession and exercise of which registration is required to
protect both labor and the public against abuses, fraud, or
 impostors who pose as organizers, although not truly
accredited agents of the union they purport to represent.
Such requirement is a valid exercise of the police power,
because the activities in which labor organizations,
associations and unions of workers are engaged affect public
interest, which should be protected
Modes of Registration (Labor Organizations)
Coastal Subic Bay Terminal vs. DOLE, G.R. No.
157117, November 20, 2006

Labor Law; Labor Unions; Jurisdictions; The Regional Offices

of the Department of Labor and Employment and the
Bureau of Labor Relations have jurisdiction over applications
for registration by labor organizations.Even after the
amendments, the rules did not divest the Regional Office
and the BLR of their jurisdiction over applications for
registration by labor organizations. The amendments to the
implementing rules merely specified that when the
application was filed with the Regional Office, the application
would be acted upon by the BLR.
San Miguel Corporation (Mandaue Packaging) vs.
Mandaue Packing Products Plants (SMAMRFU), G.R. No.
152356, August 16, 2005

A less stringent procedure obtains in the registration of a

local or chapter than that of a labor organization .
Preliminarily, we should note that a less stringent procedure
obtains in the registration of a local or chapter than that of a
labor organization. Undoubtedly, the intent of the law in
imposing lesser requirements in the case of a branch or local
of a registered federation or national union is to encourage
the affiliation of a local union with a federation or national
union in order to increase the local unions bargaining
 powers respecting terms and conditions of labor. This policy
has remained consistent despite the succeeding
amendments to Book V of the Omnibus Implementing Rules,
as contained in Department Orders Nos. 9 and 40.
Cancellation of Registration (Labor Organizations)
The Heritage Manila Hotel vs. PIGLAS-Heritage, G.R.
No. 177024, October 30, 2009

Labor Law; Labor Unions; Dual Unionism; The fact that

some of respondent PIGLAS unions members were also
members of the old rank and file union, the HHE union, is
not a ground for canceling the new unions registration.
The fact that some of respondent PIGLAS unions members
were also members of the old rank and file union, the HHE
union, is not a ground for canceling the new unions
registration. The right of any person to join an organization
also includes the right to leave that organization and join
another one. Besides, HHE union is dead. It had ceased to
exist and its certificate of registration had already been
cancelled. Thus, petitioners arguments on this point may
also be now regarded as moot and academic

Rights and Conditions of Membership (Labor

Organizations)

Fees and Collection

Del Pilar Academy vs. Del Pilar Academy Employees
Union, G.R. No. 170112, April 30, 2008

The collection of agency fees in an amount equivalent to

union dues and fees, from employees who are not union
members, is recognized by Article 248(e) of the Labor Code,
thus: Employees of an appropriate collective bargaining unit
 who are not members of the recognized collective bargaining
agent may be assessed reasonable fees equivalent to the
dues and other fees paid by the recognized collective
bargaining agent, if such non-union members accept the
benefits under the collective bargaining agreement.
Provided, That the individual authorization required under
Article 241, paragraph (o) of this Code shall not apply to the
non-members of recognized collective bargaining agent.

Method of Election (Labor Organizations)

Assessments and Check-Offs
ABS-CBN Supervisors Employee Union vs. ABS-CBN,
G.R. No. 106518, March 11, 1999

A check-off is a process or device whereby the employer, on

agreement with the Union, recognized as the proper
bargaining representative, or on prior authorization from its
employees, deducts union dues or agency fees from the
latters wages and remits them directly to the union. Its
desirability in a labor organization is quite evident. It is
assured thereby of continuous funding. As this Court has
acknowledged, the system of check-off is primarily for the
benefit of the Union and only indirectly, for the individual
employees.

Appropriate Bargaining Unit

Globe Doctrine / The Express Will or Desire of the

Employees Test

International School Alliance of Educators (ISAE) vs.

Quisumbing, G.R. No. 128845, June 1, 2000
The very broad Article 19 of the Civil Code requires every
person, "in the exercise of his rights and in the performance
of his duties, [to] act with justice, give everyone his due,
and observe honesty and good faith."

International law prohibits discrimination, such as the

Universal Declaration of Human Rights and the International
Covenant on Economic, Social, and Cultural Rights. The
latter promises Fair wages and equal remuneration for work
of equal value without distinction of any kind.

In the workplace, where the relations between capital and

labor are often skewed in favor of capital, inequality and
discrimination by the employer are all the more
reprehensible.

In this jurisdiction, there is the term equal pay for equal

work, pertaining to persons being paid with equal salaries
and have similar skills and similar conditions. There was no
evidence here that foreign-hires perform 25% more
efficiently or effectively than the local-hires. The State,
therefore, has the right and duty to regulate the relations
between labor and capital. These relations are not merely
contractual but are so impressed with public interest that
labor contracts, collective bargaining agreements included,
must yield to the common good.

For the same reason, the "dislocation factor" and the

foreign-hires' limited tenure also cannot serve as valid bases
for the distinction in salary rates. The dislocation factor and
limited tenure affecting foreign-hires are adequately
compensated by certain benefits accorded them which are
 not enjoyed by local-hires, such as housing, transportation,
shipping costs, taxes and home leave travel allowances. In
this case, we find the point-of-hire classification employed
by respondent School to justify the distinction in the salary
rates of foreign-hires and local hires to be an invalid
classification. There is no reasonable distinction between the
services rendered by foreign-hires and local-hires.

Substantial Mutual Interest Principle / Community or

Mutuality of Interest Test

National Association Of Free Trade Unions vs. Mainit

Lumber Development Company Workers Union, G.R. No.
79526, December 21, 1990

The existence of a bargaining history is a factor that may be

reckoned with in determining the appropriate bargaining
unit, the same is not decisive or conclusive. Other factors
must be considered. The test of grouping is community or
mutuality of interests. This is so because the basic test of
an asserted bargaining units acceptability is whether or not
it is fundamentally the combination which will best assure to
all employees the exercise of their collective bargaining
rights.
Certainly, there is a mutuality of interest among the
employees of the Sawmill Division and the Logging Division.
Their functions mesh with one another. One group needs
the other in the same way that the company needs them
both. There may be difference as to the nature of their
individual assignments but the distinctions are not enough to
warrant the formation of a separate bargaining unit.

San Miguel Corporation vs. Laguesma, G.R. No.

 100485, September 21, 1994

The fundamental factors in determining the appropriate

collective bargaining unit are: (1) the will of the employees
(Globe Doctrine); (2) affinity and unity of the employees'
interest, such as substantial similarity of work and duties, or
similarity of compensation and working conditions
(Substantial Mutual Interests Rule); (3) prior collective
bargaining history; and (4) similarity of employment status.

Contrary to petitioner's assertion, this Court has categorically

ruled that the existence of a prior collective bargaining
history is neither decisive nor conclusive in the determination
of what constitutes an appropriate bargaining unit. Indeed,
the test of grouping is mutuality or commonality of interests.
The employees sought to be represented by the collective
bargaining agent must have substantial mutual interests in
terms of employment and working conditions as evinced by
the type of work they perform

There is similarity of employment status for only the regular

sales personnel in the north Luzon area are covered. They
have the same duties and responsibilities and substantially
similar compensation and working conditions. The
commonality of interest among the sales personnel in the
north Luzon sales area cannot be gainsaid.

San Miguel Foods Incorporated vs. San Miguel

Corporation Supervisors and Exempt Union, G.R. No.
146206, August 1, 2011

An appropriate bargaining unit is defined as a group of

employees of a given employer, comprised of all or less than
 all of the entire body of employees, which the collective
interest of all the employees, consistent with equity to the
employer, indicate to be best suited to serve the reciprocal
rights and duties of the parties under the collective
bargaining provisions of the law.

It held that while the existence of a bargaining history is a

factor that may be reckoned with in determining the
appropriate bargaining unit, the same is not decisive or
conclusive. Other factors must be considered. The test of
grouping is community or mutuality of interest. This is so
because the basic test of an asserted bargaining units
acceptability is whether or not it is fundamentally the
combination which will best assure to all employees the
exercise of their collective bargaining rights. Certainly, there
is a mutuality of interest among the employees. Their
functions mesh with one another. One group needs the
other in the same way that the company needs them both.
There may be differences as to the nature of their individual
assignments, but the distinctions are not enough to warrant
the formation of a separate bargaining unit.

Participation in the policy and decision-making

process

PAL vs. NLRC, G.R. 85985, August 13, 1993

The Association recognizes the right of the Company to

determine matters of management it policy and Company
operations and to direct its manpower. Management of the
Company includes the right to organize, plan, direct and
control operations, to hire, assign employees to work,
transfer employees from one department, to another, to
promote, demote, discipline, suspend or discharge
employees for just cause; to lay-off employees for valid and
legal causes, to introduce new or improved methods or
facilities or to change existing methods or facilities and the
right to make and enforce Company rules and regulations to
carry out the functions of management.

Such provision in the collective bargaining agreement may

not be interpreted as cession of employees' rights to
participate in the deliberation of matters which may affect
their rights and the formulation of policies relative thereto.
And one such mater is the formulation of a code of
discipline.

Industrial peace cannot be achieved if the employees are

denied their just participation in the discussion of matters
affecting their rights. Thus, even before Article 211 of the
labor Code (P.D. 442) was amended by Republic Act No.
6715, it was already declared a policy of the State, "(d) To
promote the enlightenment of workers concerning their
rights and obligations . . . as employees." This was, of
course, amplified by Republic Act No 6715 when it decreed
the "participation of workers in decision and policy making
processes affecting their rights, duties and welfare." PAL's
position that it cannot be saddled with the "obligation" of
sharing management prerogatives as during the formulation
of the Code, Republic Act No. 6715 had not yet been
enacted (Petitioner's Memorandum, p. 44; Rollo, p. 212),
cannot thus be sustained. While such "obligation" was not
yet founded in law when the Code was formulated, the
attainment of a harmonious labor-management relationship
and the then already existing state policy of enlightening
workers concerning their rights as employees demand no
 less than the observance of transparency in managerial
moves affecting employees' rights.

Representation Issue in Organized Establishments

Purpose

Port Workers Union of the Phils. vs

Laguesma

Pursuant to the constitutional provision guaranteeing

workers the right to self-organization and collective
bargaining, the constant and unwavering policy of this
Court has been to require a certification election as the
best means of ascertaining which labor organization should
be the collective bargaining representative.

The certification election is the most democratic and

expeditious method by which the laborers can freely
determine the union that shall act as their representative in
their dealings with the establishment where they are
working. The holding of a certification election is a statutory
policy that should not be circumvented.
In line with the policy, we feel that the administrative rule
requiring the simultaneous submission of the 25% consent
signatures upon the filing of petition for certification election
should not be strictly applied to frustrate the determination
of the legitimate representative of the workers. Significantly,
the requirement in the rule is not found in Article 256, the
law it seeks to implement. This is all the more reason why
the regulation should at best be given only a directory
effect. Accordingly, we hold that the mere filing of a petition
for certification election within the freedom period is
sufficient basis for the issuance of an order for the holding
of a certification election, 8 subject to the submission of the
consent signatures within a reasonable period from such
filing.

Reyes vs. Trajano, G.R. No. 84433, June 2, 1992

The right of self-organization includes the right to organize

or affiliate with a labor union or determine which of two or
more unions in an establishment to join, and to engage in
concerted activities with co-workers for purposes of
collective bargaining through representatives of their own
choosing, or for their mutual aid and protection, i.e., the
protection, promotion, or enhancement of their rights and
interests.

The right to form or join a labor organization necessarily

includes the right to refuse or refrain from exercising said
right. It is self-evident that just as no one should be denied
the exercise of a right granted by law, so also, no one
should be compelled to exercise such a conferred right. The
fact that a person has opted to acquire membership in a
labor union does not preclude his subsequently opting to
renounce such membership.

The purpose of a certification election is precisely the

ascertainment of the wishes of the majority of the
employees in the appropriate bargaining unit: to be or not to
be represented by a labor organization, and in the
affirmative case, by which particular labor organization. If
the results of the election should disclose that the majority
of the workers do not wish to be represented by any union,
 then their wishes must be respected, and no union may
properly be certified as the exclusive representative of the
workers in the bargaining unit in dealing with the employer
regarding wages, hours and other terms and conditions of
employment. The minority employees who wish to have a
union represent them in collective bargaining can do nothing
but wait for another suitable occasion to petition for a
certification election and hope that the results will be
different. They may not and should not be permitted,
however, to impose their will on the majority who do not
desire to have a union certified as the exclusive workers
benefit in the bargaining unit upon the plea that they, the
minority workers, are being denied the right of self-
organization and collective bargaining.

Run-Off Elections

NUWHRAIN Manila Pavilion vs. Sec. of Labor, G.R. No.

181531, July 31, 2009

Prescinding from the Courts ruling that all the probationary

employees votes should be deemed valid votes while that of
the supervisory employees should be excluded, it follows
that the number of valid votes cast would increase from
321 to 337. Under Art. 256 of the Labor Code, the union
obtaining the majority of the valid votes cast by the eligible
voters shall be certified as the sole and exclusive bargaining
agent of all the workers in the appropriate bargaining unit.
This majority is 50% + 1. Hence, 50% of 337 is 168.5 + 1
or at least 170.

It bears reiteration that the true importance of ascertaining

the number of valid votes cast is for it to serve as basis for
 computing the required majority, and not just to determine
which union won the elections. The opening of the
segregated but valid votes has thus become material. To be
sure, the conduct of a certification election has a two-fold
objective: to determine the appropriate bargaining unit and
to ascertain the majority representation of the bargaining
representative, if the employees desire to be represented at
all by anyone. It is not simply the determination of who
between two or more contending unions won, but whether it
effectively ascertains the will of the members of the
bargaining unit as to whether they want to be represented
and which union they want to represent them.

Having declared that no choice in the certification election

conducted obtained the required majority, it follows that a
run-off election must be held to determine which between
HIMPHLU and petitioner should represent the rank-and-file
employees.

No Direct Certification

Central Negros vs. Sec. of Labor, G.R. No. 94045,

September 13, 1991

The right of the employees to self-organization is a

compelling reason why their withdrawal from the
cooperative must be allowed. As pointed out by CURE, the
resignation of the member- employees is an expression of
their preference for union membership over that of
membership in the cooperative. The avowed policy of the
State to afford fall protection to labor and to promote the
primacy of free collective bargaining mandates that the
employees right to form and join unions for purposes of
 collective bargaining be accorded the highest consideration.

Thus, member employees of a cooperative may withdraw as

members of the cooperative in order to join labor union.
Membership in a cooperative is voluntary; inherent in it is
the right not to join.

1. A cooperative, therefore, is by its nature different from an

ordinary business concern being run either, by persons,
partnerships or corporations. Its owners and/or members
are the ones who run and operate the business while the
others are its employees.

2. An employee therefore of such a cooperative who is a

member and co-owner thereof cannot invoke the right to
collective bargaining for certainly an owner cannot bargain
with himself or his co-owners. Employees of cooperatives
who are themselves members of the cooperative have no
right to form or join labor organizations for purposes of
collective bargaining for being themselves co-owners of the
cooperative.

3. However, in so far as it involves cooperatives with

employees who are not members or co-owners thereof,
certainly such employees are entitled to exercise the rights
of all workers to organization, collective bargaining,
negotiations and others as are enshrined in the Constitution
and existing laws of the country.
Samahang Manggagawa sa Premex vs. Sec. of Labor,
G.R. No. 107792, March 2, 1998

The challenged decision and order of the respondent

Secretary of Labor are AFFIRMED. Certification election is
 the most effective and the most democratic way of
determining which labor organization can truly represent the
working force in the appropriate bargaining unit of a
company. But it is not enough that a union has the support
of the majority of the employees. It is equally important that
everyone in the bargaining unit be given the opportunity to
express himself.

The Contract Bar Rule is not applicable in this case. The

purpose of the rule is to ensure stability in the relationships
of the workers and the management by preventing frequent
modifications of any collective bargaining agreement earlier
entered into by them in good faith and for the stipulated
original period. The petitioner entered into a CBA with
Permex Producer when its status as exclusive bargaining
agent of the employees had not been established yet.

The purpose of the Contract Bar rule is to ensure stability in

the relationships of the workers and the management by
preventing frequent modifications of any collective
bargaining agreement earlier entered into by them in good
faith and for the stipulated original period. Decision and
order by Sec. of Labor affirmed.

Effect of Withdrawal of Employee Participation

Tagaytay Highlands International Golf Club vs.

Tagaytay Highlands Employees Union-PGTWO, G.R. No.
142000, January 22, 2003

As for petitioner s allegation that some of the signatures in

the petition for certification election were obtained through
fraud, false statement and misrepresentation, the proper
 procedure is, as reflected above, for it to file a petition for
cancellation of the certificate of registration, and not to
intervene in a petition for certification election. Regarding
the alleged withdrawal of union members from participating
in the certification election, this Courts following ruling is
instructive:

The best forum for determining whether there were indeed

retractions from some of the laborers is in the certification
election itself wherein the workers can freely express their
choice in a secret ballot. Suffice it to say that the will of the
rank-and-file employees should in every possible instance be
determined by secret ballot rather than by administrative or
quasi-judicial inquiry. Such representation and certification
election cases are not to be taken as contentious litigations
for suits but as mere investigations of a non-adversary, fact-
finding character as to which of the competing unions
represents the genuine choice of the workers to be their sole
and exclusive collective bargaining representative with their
employer.

Unorganized Establishment

Sugbuanon Rural Bank vs. Laguesma, G.R. No. 116194,

February 3, 2000
Confidential employees are those who (1) assist or act in a
confidential capacity, in regard (2) to persons who
formulate, determine, and effectuate management policies
[specifically in the field of labor relations].9 The two criteria
are cumulative, and both must be met if an employee is to
be considered a confidential employee that is, the
confidential relationship must exist between the employee
and his superior officer; and that officer must handle the
prescribed responsibilities relating to labor relations.

Art. 245 of the Labor Code does not directly prohibit

confidential employees from engaging in union activities.
However, under the doctrine of necessary implication, the
disqualification of managerial employees equally applies to
confidential employees. The confidential-employee rule
justifies exclusion of confidential employees because in the
normal course of their duties they become aware of
management policies relating to labor relations. It must be
stressed, however, that when the employee does not have
access to confidential labor relations information, there is no
legal prohibition against confidential employees from
forming, assisting, or joining a union.

One of the rights of a legitimate labor organization under

Article 242(b) of the Labor Code is the right to be certified
as the exclusive representative of all employees in an
appropriate bargaining unit for purposes of collective
bargaining. Having complied with the requirements of Art.
234, it is our view that respondent union is a legitimate labor
union. Article 257 of the Labor Code mandates that a
certification election shall automatically be conducted by the
Med-Arbiter upon the filing of a petition by a legitimate labor
organization.16 Nothing is said therein that prohibits such
automatic conduct of the certification election if the
management appeals on the issue of the validity of the
unions registration. On this score, petitioners appeal was
correctly dismissed.

Employer as the Petitioner

 Labor Code Art. 258

Notre Dame of Greater Manila vs. Laguesma, G.R. No.

149833, June 29, 2004

The appeal of the med-arbiters January 13, 1992

handwritten notation pertaining to the incidental matter of
the list of voters should not stay the holding of the
certification election. Ratio. Not all the orders issued by a
med-arbiter are appealable. In fact, [i]nter locutory orders
issued by the med-arbiter prior to the grant or denial of the
petition, including orders granting motions for intervention
issued after an order calling for a certification election, shall
not be appealable. However, any issue arising there from
may be raised in the appeal on the decision granting or
denying the petition.

The intention of the law is to limit the grounds for appeal

that may stay the holding of a certification election. This
intent is manifested by the issuance of Department Order
No. 40. Under the new rules, an appeal of a med-arbiters
order to hold a certification election will not stay the holding
thereof where the employer company is an unorganized
establishment, and where no union has yet been duly
recognized or certified as a bargaining representative.
This new rule, therefore, decreases or limits the appeals that
may impede the selection by employees of their bargaining
representative. Expediting such selection process advances
the primacy of free collective bargaining, in accordance with
the States policy to promote and emphasize the primacy of
free collective bargaining x x x; and to ensure the
participation of workers in decision and policy-making
 processes affecting their rights, duties and welfare.

Registration

Labor Code Art. 238-A

Progressive Development Corporation vs. Laguesma,

G.R. No. 96425, February 4, 1992

The court held that to determine the validity of labor unions

art. 234 requirements of registration must be complied with.
If its application for registration is vitiated by falsification
and serious irregularities, especially those appearing on the
face of the application and the supporting documents, a
labor organization should be denied recognition as a
legitimate labor org.

Wherefore, inasmuch as the legal personality of respondent

union had been seriously challenge, it would have been
more prudent to have granted petitioners request for the
suspension of proceedings in the cert election case, until the
issue of the legality of the unions registration shall have
been resolved. Failure of the med-arbiter and public
respondent to heed the request constituted a grave abuse of
discretion.

The Court's conclusion should not be misconstrued as

impairing the local union's right to be certified as the
employees' bargaining agent in the petitioner's
establishment. We are merely saying that the local union
must first comply with the statutory requirements in order to
exercise this right. Big federations and national unions of
 workers should take the lead in requiring their locals and
chapters to faithfully comply with the law and the rules
instead of merely snapping union after union into their folds
in a furious bid with rival federations to get the most number
of members.

Affiliation and disaffiliation of the local union from

the mother union

Substitutionary doctrine

Alliance of Nationalist And Genuine Labor Organization

vs. SAMANA BAY, G.R. No. 118562, July 5, 1996

As a rule, a labor union may disaffiliate from the mother

union only within the freedom period. (PD 1391 No
petition for certification election, for intervention and
disaffiliation shall be entertained or given due course except
within the 60-day freedom period) However, under
ARTICLE 239-A, disaffiliation may be carried out by a vote of
2/3 of its general membership in a meeting duly called for
that purpose to dissolve the organization.

In addition, with respect to the removal of the officers, a

local union does not owe its existence to the federation with
which it is affiliated. Having its own personality, the mother
federation has no license to act independently of the local
union. Any act performed by ANGLO affecting the interest
and affairs of SAMANA, including the ouster of herein
individual private respondent, is rendered without force and
effect.

Benguet Consolidated vs. BCI Employees and Workers

Union, G.R. No. L-24711, April 30, 1968, En Banc

BENGUET erroneously invokes the so-called Doctrine of

Substitution referred to in General Maritime Stevedores
Union v. South Sea Shipping Lines where it was ruled that:

We also hold that where the bargaining contract is to run

for more than two years, the principle of substitution may
well be adopted and enforced by the CIR to the effect that
after two years of the life of a bargaining agreement, a
certification election may be allowed by the CIR, that if a
bargaining agent other than the union or organization that
executed the contract, is elected, said new agent would
have to respect said contract, but that it may bargain with
the management for the shortening of the life of the
contract if it considers it too long, or refuse to renew the
contract pursuant to an automatic renewal clause.

BENGUETs reliance upon the Principle of Substitution is

totally misplaced. This principle, formulated by the NLRB as
its initial compromise solution to the problem facing it when
there occurs a shift in employees union allegiance after the
execution of a bargaining contract with their employer,
merely states that even during the effectivity of a collective
bargaining agreement executed between employer and
employees thru their agent, the employees can change said
agent but the contract continues to bind them up to its
expiration date. They may bargain however for the
shortening of said expiration date.

The substitutionary doctrine cannot be invoked to support

the contention that a newly certified collective bargaining
agent automatically assumes all the personal undertakings
 like the no-strike stipulation here in the collective
bargaining agreement made by the deposed union. When
BBWU bound itself and its officers not to strike, it could not
have validly bound also all the other rival unions existing in
the bargaining units in question. BBWU was the agent of the
employees, not of the other unions which possess distinct
personalities.

Collective Bargaining

Definition

University of the Immaculate Conception vs. Sec. of

Labor, G.R. No. 146291, January 23, 2002

A collective bargaining agreement (CBA) refers to the

negotiated contract between a legitimate labor organization
and the employer concerning wages, hours of work and all
other terms and conditions of employment in a bargaining
unit, including mandatory provisions for grievances and
arbitration machineries. As in all other contracts, there must
be clear indications that the parties reached a meeting of the
minds.

In this case, no CBA could be concluded because of what the

union perceived as illegal deductions from the 70%
employees' share in the tuition fee increase from which the
salary increases shall be charged. Also, the manner of
computing the net incremental proceeds was yet to be
agreed upon by the parties.

Petitioner insisted that a new collective bargaining

 agreement was concluded through the conciliation
proceeding before the NCMB on all issues specified in the
notice of strike. Although it is true that the university and
the union may have reached an agreement on the issues
raised during the collective bargaining negotiations, still no
agreement was concluded by them because, among other
reasons, the DOLE Secretary, who assumed jurisdiction on
January 23, 1995 only was set to resolve the distribution of
the salary increase of the covered employees. The Court of
Appeals found that "there are many items in the draft-CBA
that were not even mentioned in the minutes of the July 20,
1994 conference."

Duty to Bargain

Nature

Collegio de San Juan De Letran vs Association of

Employees and Faculty of Letran, G.R. No. 141471,
September 18, 2000

The petitioners failure to act upon the submitted CBA

proposal within the ten-day period exemplified in Article 250
of the Labor Code is a clear violation of the governing
procedure of collective bargaining. As the Court has held in
Kiok Loy vs. NLRC, the companys refusal to make counter-
proposal to the unions proposed CBA is an indication of bad
faith. Moreover, the succeeding events are obvious signs
that the petitioner had merely been employing delaying
tactics to the passage of the proposed CBA. Moreover, in
order to allow the employer to validly suspend the
bargaining process, there must be a valid petition for
certification election raising a legitimate representation
 issue. Hence, the mere filing of a petition for certification
election does not ipso facto justify the suspension of
negotiation by the employer.

The factual backdrop of the termination of Ambas led the

Court to no other conclusion that she was dismissed in order
to strip the union of a leader who would fight for the right of
her co-workers in the bargaining table. While the Court
recognizes the right of the employer to terminate the
services of an employee for a just or authorized cause,
nevertheless, the dismissal of employees must be made
within the parameters of aw and pursuant to the tenets of
equity and fair play. Even assuming arguendo that Ambas
was guilty of insubordination, such disobedience was not a
valid ground to terminate her employment. When the
exercise of the management to discipline its employees
tends to interfere with the employees right to self-
organization, it amounts to union-busting and is therefore a
prohibited act.

Kiok Loy vs. NLRC, G.R. No. L-54334, January 22, 1986

Collective bargaining which is defined as negotiations

towards a collective agreement, is one of the democratic
frameworks under the New Labor Code, designed to stabilize
the relation between labor and management and to create a
climate of sound and stable industrial peace. It is a mutual
responsibility of the employer and the Union and is
characterized as a legal obligation.

.A Companys refusal to make counter proposal if considered

in relation to the entire bargaining process, may indicate bad
faith and this is especially true where the Unions request for
 a counter proposal is left unanswered. Even during the
period of compulsory arbitration before the NLRC, petitioner
Companys approach and attitude-stalling the negotiation by
a series of postponements, non-appearance at the hearing
conducted, and undue delay in submitting its financial
statements, lead to no other conclusion except that it is
unwilling to negotiate and reach an agreement with the
Union.

Collective Bargaining Agreement

Interpretation and Nature

PNCC Skyway Traffic Management and Security

Division Workers Organization v. PNCC Skyway Corp., G.R.
No. 171231, February 17, 2010

If the terms of a CBA are clear and leave no doubt upon the
intention of the contracting parties, the literal meaning of its
stipulation shall prevail. In fine, the CBA must be strictly
adhered to and respected if its ends have to be achieved,
being the law between the parties. The provisions of the
CBA must be respected since its terms and conditions
constitute the law between the parties. The parties cannot
be allowed to change the terms they agreed upon on the
ground that the same are not favorable to them.

RFM Corporation vs. KAMPI-NAFLU-KMU, G.R. No.

162324, February 4, 2009

If the terms of a CBA are clear and have no doubt upon the
intention of the contracting parties, as in the herein
questioned provision, the literal meaning thereof shall
 prevail. That is settled. As such, the daily-paid employees
must be paid their regular salaries on the holidays which are
so declared by the national government, regardless of
whether they fall on rest days. Holiday pay is a legislated
benefit enacted as part of the Constitutional imperative that
the State shall afford protection to labor. Its purpose is not
merely "to prevent diminution of the monthly income of the
workers on account of work interruptions. In other words,
although the worker is forced to take a rest, he earns what
he should earn, that is, his holiday pay."

The CBA is the law between the parties, hence, they are
obliged to comply with its provisions. Indeed, if petitioner
and respondents intended the provision in question to cover
payment only during holidays falling on work or weekdays, it
should have been so incorporated therein. RFM maintains,
however, that the parties failed to foresee a situation where
the special holiday would fall on a rest day. The Court is not
persuaded. The Labor Code specifically enjoins that in case
of doubt in the interpretation of any law or provision
affecting labor, it should be interpreted in favor of labor.

Halaguena vs. PAL, G.R. No. 172013, October 2,

2009

Jurisdiction of the court is determined on the basis of the

material allegations of the complaint and the character of
the relief prayed for irrespective of whether plaintiff is
entitled to such relief. In the case at bar, the allegations in
the petition for declaratory relief plainly show that
petitioners cause of action is the annulment of Section 144,
Part A of the PAL-FASAP CBA.
 Not every dispute between an employer and employee
involves matters that only labor arbiters and the NLRC can
resolve in the exercise of their adjudicatory or quasi-judicial
powers. The jurisdiction of labor arbiters and the NLRC
under Article 217 of the Labor Code is limited to disputes
arising from an employer-employee relationship which can
only be resolved by reference to the Labor Code, other labor
statutes, or their collective bargaining agreement.

Duration of Agreement

Effect of Expiry

New Pacific Timber Supply Co. vs. NLRC, G.R. No.

124224, march 17, 2000

It is clear from Art. 253 that until a new CBA has been
executed by and between the parties; they are duly bound
to keep the status quo and to continue in full force and
effect the terms and conditions of the existing agreement. In
the case at bar, no new agreement was entered between
the parties pending appeal of the decision in the NLRC.
Consequently, the employees from to the year 1985 (after
expiration of the CBA) onwards would be deprived of a
substantial amount of monetary benefits if the terms and
conditions of the CBA were not to remain in force and effect
which runs counter to the intent of the Labor Cod to curb
labor unrest and promote industrial peace.

Manila Electric Coop. vs, Quisumbing, G.R. No. 127598,

February 22, 2000

CBA arbitral awards granted after six months from the

 expiration of the last CBA shall retroact to such time agreed
upon by both employer and the employees or their union.
Absent such an agreement as to retroactivity, the award
shall retroact to the first day after the six-month period
following the expiration of the last day of the CBA should
there be one. In the absence of a CBA, the Secretarys
determination of the date of retroactivity as part of his
discretionary powers over arbitral awards shall control.

Faculty Association of Mapua Institute of Technology

vs. CA. G.R. No. 164060, June 15, 2007

Until a new CBA is executed by and between the parties,

they are duty-bound to keep the status quo and to continue
in full force and effect the terms and conditions of the
existing agreement. The law does not provide for any
exception nor qualification on which economic provisions of
the existing agreement are to retain its force and effect.
Therefore, it must be understood as encompassing all the
terms and conditions in the said agreement.

Contract Beneficiaries

New Pacific Timber Supply Co. vs. NLRC, G.R. No.

124224, March 17, 2000

When a CBA is entered into by the union representing the

employees and the employer, even the non-union members
are entitled to the benefits of the contract. A laborer can
claim benefits from a CBA entered into the company and the
union of which he is a member at the time of the conclusion
of the agreement even after he has resigned from said
union. Therefore, the benefits under the CBA should be
 extended to those who only became such after it expired; to
exclude them would constitute undue discrimination.

Manlimos vs. NLRC. G.R. No. 113337, March 2, 1995

Where such transfer of ownership is in good faith, the

transferee is under no legal duty to absorb the transferor's
employees as there is no law compelling such absorption.
It is settled that while probationary employees do not enjoy
permanent status, they are accorded the constitutional
protection of security of tenure. They may only be
terminated for just cause or when they fail to qualify as
regular employees in accordance with reasonable standards
made known to them by the employer at the time of their
engagement. This constitutional protection, however, ends
upon the expiration of the period provided for in their
probationary contract of employment. Thereafter, the parties
are free to renew the contract or not.
Union Security Arrangements
Unfair Labor Practices of Employers

Inguillo vs. First Philippine Scales Inc., G.R. No.

165407, June 5, 2009

The Labor Code has several provisions under which an

employee may be validly terminated, namely (1) just causes
under Article 282; (2) authorized causes under Article 283;
(3) termination due to disease under Article 284; and (4)
termination by the employee or resignation under Article
285. While the said provisions did not mention as ground
the enforcement of the Union Security Clause in the CBA,
the dismissal from employment based on the same is
recognized and accepted in our jurisdiction.
 Union Security is a generic term, which is applied to and
prehends closed shop, union shop, maintenance of
membership or any other form of agreement which imposes
upon employees the obligation to acquire or retain union
membership as a condition of employment.
While We uphold dismissal pursuant to a union security
clause, the same is not without a condition or restriction. For
to allow its untrammeled enforcement would encourage
arbitrary dismissal and abuse by the employer, to the
detriment of the employees. Thus, to safeguard the rights of
the employees, We have said time and again that dismissals
pursuant to union security clauses are valid and legal,
subject only to the requirement of due process, that is,
notice and hearing prior to dismissal. In like manner, We
emphasized that the enforcement of union security clauses
is authorized by law, provided such enforcement is not
characterized by arbitrariness, and always with due process.
Tanduay Distillery Labor Union vs. NLRC, G.R. No.
75037, April 30, 1987

The dismissal of an employee pursuant to a demand of the

majority union in accordance with a union security
agreement following the loss of seniority rights is valid and
privileged and does not constitute an unfair labor practice.
Article 249 (e) of the Labor Code as amended specifically
recognizes the closed shop arrangement as a form of union
security. The closed shop, the union shop, the maintenance
of membership shop, the preferential shop, the maintenance
of treasury shop, and check-off provisions are valid forms of
union security and strength. They do not constitute unfair
labor practice nor are they violations of the freedom of
association clause of the Constitution. There is no showing in
these petitions of any arbitrariness or a violation of the
 safeguards enunciated in the decisions of this Court
interpreting union security arrangements brought to us for
review.

Grievance Machinery

3. Grievance Procedure in CBA

Juanito Tabigue vs. International Copra Export Corp., G.R.

No. 183335, December 23, 2009

Pursuant to Article 260 of the Labor Code, the parties to a

CBA shall name or designate their respective representatives
to the grievance machinery and if the grievance is unsettled
in that level, it shall automatically be referred to the
voluntary arbitrators designated in advance by parties to a
CBA. Consequently only disputes involving the union and the
company shall be referred to the grievance machinery or
voluntary arbitrators.
The labor organization designated or selected by the
majority of the employees in an appropriate collective
bargaining unit shall be the exclusive representative of the
employees in such unit for the purpose of collective
bargaining. However, an individual employee or group of
employees shall have the right at any time to present
grievances to their employer. But the right of any employee
or group of employees to, at any time, present grievances to
the employer does not imply the right to submit the same to
voluntary arbitration.
Grievance Issues
Caltex Refinery Employees Association vs. Brillantes, G.R.
No.123782, September 16, 1997
 No particular setup for grievance machinery is mandated by
law. Art. 260 of the LC (now Art. 266), as incorporated by
RA 6715, provides for a single grievance machinery to settle
problems arising from interpretation of implementation of
the CBA. The procedure ordered by Brillantes sufficiently
complied with the minimum requirement of the law. In fact,
he went beyond the minimum by providing for two steps.
While it was contended that he did not act on the dispute by
leaving the number of voluntary arbitrators to the choice of
the parties, this was seen as affording the parties latitude to
decide for themselves.

Voluntary Arbitration

Santuyo vs. Remerco Garments Manufacturing, Inc., G.R.

No. 174420, March 22, 2010

Art. 217 of the labor code provides that labor arbiters are
required to refer cases involving the implementation of CBAs
to the grievance machinery provided therein and to
voluntary arbitration.
Moreover, Article 260 of the Labor Code clarifies that such
disputes must be referred first to the grievance machinery
and, if unresolved within seven days, they shall
automatically be referred to voluntary arbitration. Also,
under Art. 261, voluntary arbitrators have original and
exclusive jurisdiction over matters which have not been
resolved by the grievance machinery.

Unfair Labor Practices (ULP)

 Totality of Conduct Doctrine

Insular Life Assurance Co., Ltd., Employees Association vs.

Insular Life Assurance, G.R. No. L-25291, January 30, 1970

The letters should not be considered by themselves alone

but should be read in the light of the preceding and
subsequent circumstances surrounding them. The letters
should be interpreted according to the totality of conduct
doctrine, whereby the culpability of an employers remarks
were to be evaluated not only on the basis of their implicit
implications, but were to be appraised against the
background of and in conjunction with collateral
circumstances. Under this doctrine expressions of opinion
by an employer which, though innocent in themselves,
frequently were held to be culpable because of the
circumstances under which they were uttered, the history of
the particular employers labor relations or anti-union bias or
because of their connection with an established collateral
plan of coercion or interference.
Hacienda Fatima vs. Natl. Federation of Sugarcane Workers,
G.R. No. 149440, January 28, 2003

The appellate court found neither rhyme nor reason in

petitioners argument that it was the workers themselves
who refused to or were choosy in their work. The NLRC also
found herein petitioners guilty of unfair labor practice when
it ruled that indeed, from respondents refusal to bargain, to
their acts of economic inducements resulting in the
promotion of those who withdrew from the union, the use of
armed guards to prevent the organizers to come in, and the
dismissal of union officials and members, one cannot but
 conclude that respondents did not want a union in their
haciendaa clear interference in the right of the workers to
self-organization.
The finding of unfair labor practice done in bad faith carries
with it the sanction of moral and exemplary damages.

Standard Chartered Bank Employees Union vs. Confessor,

G.R. No. 114974, June 16, 2004

Article 248(a) of the Labor Code, considers it an unfair labor

practice when an employer interferes, restrains or coerces
employees in the exercise of their right to self-organization
or the right to form association. The right to self-
organization necessarily includes the right to collective
bargaining.
Parenthetically, if an employer interferes in the selection of
its negotiators or coerces the Union to exclude from its panel
of negotiators a representative of the Union, and if it can be
inferred that the employer adopted the said act to yield
adverse effects on the free exercise to right to self-
organization or on the right to collective bargaining of the
employees, ULP under Article 248(a) in connection with
Article 243 of the Labor Code is committed.
In order to show that the employer committed ULP under
the Labor Code, substantial evidence is required to support
the claim. Substantial evidence has been defined as such
relevant evidence as a reasonable mind might accept as
adequate to support a conclusion.
Surface bargaining is defined as "going through the motions
of negotiating" without any legal intent to reach an
agreement. The resolution of surface bargaining allegations
never presents an easy issue. The determination of whether
a party has engaged in unlawful surface bargaining is usually
 a difficult one because it involves, at bottom, a question of
the intent of the party in question, and usually such intent
can only be inferred from the totality of the challenged
partys conduct both at and away from the bargaining table.
It involves the question of whether an employers conduct
demonstrates an unwillingness to bargain in good faith or is
merely hard bargaining.
Company Union

Philippine American Cigar and Cigarette Factory Workers

Independent Union vs. Philippine American Cigar and
Cigarette Manufacturing, Co., G.R. No. L-18364, February
28, 1963

Section 4(a) (5) of Republic Act No. 875, provides that it

shall be ULP for an employer to dismiss, discharge, or
otherwise prejudice or discriminate against an employee for
having filed charges or for having given or being about to
give testimony under this Act.
Although the cited law pertains to the specific employee who
filed a case or given a testimony against the employer, it
should be construed in line with the spirit and purpose of
said Section 4 and of the legislation of which it forms part
namely, to assure absolute freedom of the employees and
laborers to establish labor organizations and unions, as well
as to prefer charges before the proper organs of the
Government for violations of our labor laws.
What is prohibited to be done directly shall not be allowed to
be accomplished indirectly. The dismissal of a laborer on
account of union activities of his brother constituted an ULP.
The discharge of relatives of an employee who has himself
been discriminately discharged, for no other reason than the
relation, is itself a discriminatory discharge, in violation of
 the Act. The respondent thus made union membership and
activities a bar to the employment not only of the union
member himself but of members of his family as well. A
more effective mode of discouraging of union affiliation
could hardly be found then the knowledge that such
activities put not merely the union members employment
but that of those closely related to him in jeopardy.

Union Shop Agreement

Victoriano vs. Elizalde Rope Workers Union, G.R. No. L-

25246, September 12, 1974

To that all-embracing coverage of the closed shop

arrangement, RA No.3350 introduced an exception, when it
added to Section 4 (a) (4) of the Industrial Peace Act the
following proviso: but such agreement shall not cover
members of any religious sects which prohibit affiliation of
their members in any such labor organization. Republic Act
No. 3350 merely excludes ipso jure from the application and
coverage of the closed shop agreement the employees
belonging to any religious sects which prohibit affiliation of
their members with any labor organization. What the
exception provides is that members of said religious sects
cannot be compelled or coerced to join labor unions even
when said unions have closed shop agreements with the
employers; that in spite of any closed shop agreement,
members of said religious sects cannot be refused
employment or dismissed from their jobs on the sole ground
that they are not members of the collective bargaining
union. It does not prohibit the members of said religious
sects from affiliating with labor unions. It still leaves to said
members the liberty and the power to affiliate, or not to
 affiliate, with labor unions. If, notwithstanding their religious
beliefs, the members of said religious wets prefer to sign up
with the labor union, they can do so. If in deference and
fealty to their religious faith, they refuse to sign up, they can
do so; the law does not coerce them to join; neither does
the law prohibit them from joining, and neither may the
employer or labor union compel them to join.

The free exercise of religious profession or belief is superior

to contract rights. In case of conflict, the latter must yield to
the former.

ECONOMIC WEAPONS/ RIGHT TO PEACEFUL

CONCERTED ACTIVITES

Mandatory nature
CCBPI Postmix Workers Union vs. NLRC, G.R. No. 114521,
November 27, 1998 and Coca-Cola Bottlers Phil., Inc. vs.
NLRC, G.R. No. 123491, November 27, 1998

It is easily understood that before a strike may be declared,

the following requirements should be observed, to wit: (1)
the thirty-day notice or the fifteen-day notice, in case of
unfair labor practices; (2) the two-thirds (2/3) required vote
to strike done by secret ballot; and (3) the submission of the
strike vote to the DOLE at least seven days prior to the
strike. These strike requirements must concur in order for
the strike not to come under Article 265 of the Labor Code.
The language of the law leaves no room for doubt that the
cooling-off period and the seven-day strike ban after the
strike-vote report were intended to be mandatory. The
cooling-off period must be observed as it is the requisite
number of days from the mandatory filing of the Notice of
 Strike, before the lapse of which, the union may not strike.
We do not agree with the Labor Arbiters opinion that a
deficiency of one-day from the mandatory seven-day strike
ban is not a fatal defect, as to render the strike illegal. We
do not share the view that the union should be considered
to have substantially complied with the strike requirements
under the law. It bears stressing that the strike requirements
under Articles 264 and 265 of the Labor Code are mandatory
requisites, without which, the strike will be considered
illegal. The evident intention of the law in requiring the
strike notice and strike-vote report as mandatory
requirements is to reasonably regulate the right to strike,
which is essential to the attainment of legitimate policy
objectives embodied in the law. Verily, substantial
compliance with a mandatory provision will not suffice. Strict
adherence to the mandate of the law is required.
National Interest Case

Philtread Workers Union (PTWU) vs. Confessor, G.R. No.

117169, March 12, 1997

Article 263 (g) of the Labor Code does not violate the
workers constitutional right to strike. The section provides in
part, viz.: When in his opinion, there exists a labor dispute
causing or likely to cause a strike or lockout in an industry
indispensable to the national interest, the Secretary of Labor
and Employment may assume jurisdiction over the dispute
and decide it or certify the same to the Commission for
compulsory arbitration. . . . The foregoing article clearly
does not interfere with the workers right to strike but
merely regulates it, when in the exercise of such right,
national interests will be affected. The rights granted by the
Constitution are not absolute. They are still subject to
 control and limitation to ensure that they are not exercised
arbitrarily. The interests of both the employers and
employees are intended to be protected and not one of
them is given undue preference.
The Labor Code vests upon the Secretary of Labor the
discretion to determine what industries are indispensable to
national interest. Thus, upon the determination of the
Secretary of Labor that such industry is indispensable to the
national interest, it will assume jurisdiction over the labor
dispute of said industry. The assumption of jurisdiction is in
the nature of police power measure. This is done for the
promotion of the common good considering that a prolonged
strike or lockout can be inimical to the national economy.
The Secretary of Labor acts to maintain industrial peace.
Thus, his certification for compulsory arbitration is not
intended to impede the workers right to strike but to obtain
a speedy settlement of the dispute.
Phimco Industries, Inc., vs. Brillantes, G.R. No. 120751,
March 17 1999

The private respondent did not even make any effort to

touch on the indispensability of the match factory to the
national interest. It must have been aware that a match
factory, though of value, can scarcely be considered as an
industry indispensable to the national interest as it cannot
be in the same category as generation or distribution of
energy, or those undertaken by banks, hospitals, and
export-oriented industries.
It is thus evident from the foregoing that the Secretarys
assumption of jurisdiction grounded on the alleged
obtaining circumstances and not on a determination that
the industry involved in the labor dispute is one
indispensable to the national interest, the standard set by
 the legislature, constitutes grave abuse of discretion
amounting to lack of or excess of jurisdiction. To uphold the
action of the public respondent under the premises would be
stretching too far the power of the Secretary of Labor as
every case of a strike or lockout where there are
inconveniences in the community, or work disruptions in an
industry though not indispensable to the national interest,
would then come within the Secretarys power. It would be
practically allowing the Secretary of Labor to intervene in
any labor dispute at his pleasure.

MANAGEMENT PREROGATIVE
Proportionality Rule
Sagales vs. Rustans Commercial Corporation, G.R.
No. 166554, November 27, 2008

It is a hornbook doctrine that infractions committed by an

employee should merit only the corresponding penalty
demanded by the circumstance. The penalty must be
commensurate with the act, conduct or omission imputed to
the employee and must be imposed in connection with the
disciplinary authority of the employer.
The supreme penalty of dismissal is the death penalty to the
working man. Thus, care should be exercised by employers
in imposing dismissal to erring employees. The penalty of
dismissal should be availed of as a last resort. Indeed, the
immortal words of Mr. Justice (later Chief Justice) Enrique
Fernando ring true then as they do now: where a penalty
less punitive would suffice, whatever missteps may be
committed by labor ought not be visited with a consequence
so severe. It is not only because of the laws concern for the
workingman. There is, in addition, his family to consider.
 Unemployment brings untold hardships and sorrows on
those dependent on the wage-earner.
Solvic Inductrial Corp. vs. NLRC, G.R. No. 125548,
September 25, 1998

The Court agrees with the NLRC that the acts of private
respondent are not so serious as to warrant the extreme
penalty of dismissal. Private respondent was accused of
hitting the victim once with the blunt side of a bolo. Private
respondent could have attacked him with the blade of the
weapon, and he could have struck him several times. But he
did not, thus negating any intent on his part to inflict fatal
injuries. In fact, the victim merely sustained a minor
abrasion and has since forgiven and reconciled with the
private respondent. If the party most aggrievednamely,
the foremanhas already forgiven the private respondent,
then petitioner cannot be more harsh and condemning than
the victim. Besides, no criminal or civil action has been
instituted against private respondent. Furthermore, in his
twenty years of service in the company, he has not been
charged with any similar misconduct.
Verily, we do not condone the action of the private
respondent. We believe, however, that the NLRC did not
commit grave abuse of discretion in ruling that the penalty
of dismissal was too harsh and not commensurate with the
said offense. Where a penalty less punitive would suffice,
whatever missteps may be committed by labor ought not to
be visited with a consequence so severe.
Transfer of Employees
Mendoza vs. Rural Bank of Lucban, G.R. No. 155421,
July 7, 2004

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. This privilege is inherent in the right of employers to
control and manage their enterprise effectively. The right of
employees to security of tenure does not give them vested
rights to their positions to the extent of depriving
management of its prerogative to change their assignments
or to transfer them. Managerial prerogatives, however, are
subject to limitations provided by law, collective bargaining
agreements, and general principles of fair play and justice.
The test for determining the validity of the transfer of
employees was explained in Blue Dairy Corporation v. NLRC
as follows: [L]ike other rights, there are limits thereto. The
managerial prerogative to transfer personnel must be
exercised without grave abuse of discretion, bearing in mind
the basic elements of justice and fair play. Having the right
should not be confused with the manner in which that right
is exercised. Thus, it 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.
Should the employer fail to overcome this burden of proof,
the employees transfer shall be tantamount to constructive
dismissal, which has been defined as a quitting because
continued employment is rendered impossible, unreasonable
or unlikely; as an offer involving a demotion in rank and
diminution in pay. Likewise, constructive dismissal exists
 when an act of clear discrimination, insensibility or disdain
by an employer has become so unbearable to the employee
leaving him with no option but to forego with his continued
employment.
PT&T vs. Lapalana, G.R. No. 76645, July 23, 1991

It is the employers prerogative, based on its assessment

and perception of its employees qualifications, aptitudes,
and competence, to move them around in the various areas
of its business operations in order to ascertain where they
will function with maximum benefit to the company. An
employees right to security of tenure does not give him
such a vested right in his position as would deprive the
company of its prerogative to change his assignment or
transfer him where he will be most useful. When his transfer
is not unreasonable, nor inconvenient, nor prejudicial to him,
and it does not involve a demotion in rank or diminution of
his salaries, benefits, and other privileges, the employee
may not complain that it amounts to a constructive
dismissal.

Allied Banking Corporation vs. CA, G.R. No. 144412,

November 18, 2003

The rule is that the transfer of an employee ordinarily lies

within the ambit of the employers prerogatives. The
employer exercises the prerogative to transfer an employee
for valid reasons and according to the requirement of its
business, provided the transfer does not result in demotion
in rank or diminution of the employees salary, benefits and
other privileges. In illegal dismissal cases, the employer has
the burden of showing that the transfer is not unnecessary,
inconvenient and prejudicial to the displaced employee.
 The refusal to obey a valid transfer order constitutes willful
disobedience of a lawful order of an employer. Employees
may object to, negotiate and seek redress against employers
for rules or orders that they regard as unjust or illegal.
However, until and unless these rules or orders are declared
illegal or improper by competent authority, the employees
ignore or disobey them at their peril.

Genuino Ice Company, Inc. vs. Magpantay, G.R. No.

147790, June 27, 2006

The rule is that the transfer of an employee ordinarily lies

within the ambit of the employers prerogatives. The
employer exercises the prerogative to transfer an employee
for valid reasons and according to the requirement of its
business, provided the transfer does not result in demotion
in rank or diminution of the employees salary, benefits and
other privileges.
Grant Bonus
Philippine Duplicators v. NLRC, G.R. No. 110068,
February 15, 1995, En Banc

As a rule, a bonus is an amount granted and paid to an

employee for his industry and loyalty which contributed to
the success of the employer's business and made possible
the realization of profits. It is an act of generosity of the
employer for which the employee ought to be thankful and
grateful. It is also granted by an enlightened employer to
spur the employee to greater efforts for the success of the
business and realization of bigger profits. x x x. From the
legal point of view, a bonus is not a demandable and
enforceable obligation. It is so when it is made part of the
 wage or salary or compensation. In such a case the latter
would be a fixed amount and the former would be a
contingent one dependent upon the realization of profits. x x
x.

A bonus is a 'gratuity or act of liberality of the giver which

the recipient has no right to demand as a matter of right'. lt
is something given in addition to what is ordinarily received
by or strictly due the recipient. The granting of a bonus is
basically a management prerogative which cannot be forced
upon the employer 'who may not be obliged to assume the
onerous burden of granting bonuses or other benefits aside
from the employee's basic salaries or wages x x x'.

If an employer cannot be compelled to pay a productivity

bonus to his employees, it should follow that such
productivity bonus, when given, should not be deemed to
fall within the "basic salary" of employees when the time
comes to compute their 13th month pay.

Eastern Telecomunications Phil. Inc. v. Eastern

Telecoms Union, G.R. No. 185665, February 8, 2012

From a legal point of view, a bonus is a gratuity or act of

liberality of the giver which the recipient has no right to
demand as a matter of right. The grant of a bonus is
basically a management prerogative which cannot be forced
upon the employer who may not be obliged to assume the
onerous burden of granting bonuses or other benefits aside
from the employees basic salaries or wages. A bonus,
however, becomes a demandable or enforceable obligation
when it is made part of the wage or salary or compensation
of the employee. Whether or not a bonus forms part of
 wages depends upon the circumstances and conditions for
its payment. If it is additional compensation which the
employer promised and agreed to give without any
conditions imposed for its payment, such as success of
business or greater production or output, then it is part of
the wage. But if it is paid only if profits are realized or if a
certain level of productivity is achieved, it cannot be
considered part of the wage. Where it is not payable to all
but only to some employees and only when their labor
becomes more efficient or more productive, it is only an
inducement for efficiency, a prize therefore, not a part of the
wage.
Granting arguendo that the CBA Side Agreement does not
contractually bind petitioner ETPI to give the subject
bonuses, nevertheless, the Court finds that its act of
granting the same has become an established company
practice such that it has virtually become part of the
employees salary or wage. A bonus may be granted on
equitable consideration when the giving of such bonus has
been the companys long and regular practice. To be
considered a regular practice, however, the giving of the
bonus should have been done over a long period of time,
and must be shown to have been consistent and deliberate.
The test or rationale of this rule on long practice requires an
indubitable showing that the employer agreed to continue
giving the benefits knowing fully well that said employees
are not covered by the law requiring payment thereof.
Change of working hours
Manila Jockey Club Employees Labor Union, G.R. No.
167760, March 7, 2007

We are not unmindful that every business enterprise

endeavors to increase profits. As it is, the Court will not
 interfere with the business judgment of an employer in the
exercise of its prerogative to devise means to improve its
operation, provided that it does not violate the law, CBAs,
and the general principles of justice and fair play. We have
thus held that management is free to regulate, according to
its own discretion and judgment, all aspects of employment,
including hiring, work assignments, working methods, time,
place and manner of work, processes to be followed,
supervision of workers, working regulations, transfer of
employees, work supervision, layoff of workers and
discipline, dismissal, and recall of workers.

Marital discrimination

Duncan Association of Detailman-PTGWO and Pedro

Tecson v. Glaxo Wellcome Philippines, Inc., G.R. No.
162994, September 17, 2004

No less than the Constitution recognizes the right of

enterprises to adopt and enforce such a policy to protect its
right to reasonable returns on investments and to expansion
and growth. Indeed, while our laws endeavor to give life to
the constitutional policy on social justice and the protection
of labor, it does not mean that every labor dispute will be
decided in favor of the workers. The law also recognizes that
management has rights which are also entitled to respect
and enforcement in the interest of fair play.
The challenged company policy does not violate the equal
protection clause of the Constitution as petitioners
erroneously suggest. It is a settled principle that the
commands of the equal protection clause are addressed only
to the state or those acting under color of its authority.
Corollarily, it has been held in a long array of U.S. Supreme
 Court decisions that the equal protection clause erects no
shield against merely private conduct, however,
discriminatory or wrongful. The only exception occurs when
the state in any of its manifestations or actions has been
found to have become entwined or involved in the wrongful
private conduct. Obviously, however, the exception is not
present in this case.
From the wordings of the contractual provision and the
policy in its employee handbook, it is clear that Glaxo does
not impose an absolute prohibition against relationships
between its employees and those of competitor companies.
Its employees are free to cultivate relationships with and
marry persons of their own choosing. What the company
merely seeks to avoid is a conflict of interest between the
employee and the company that may arise out of such
relationships.
Philippine Telegraph and Telephone Company v. NLRC,
G.R. No. 118978, May 23, 1997

Verily, private respondents act of concealing the true nature

of her status from PT&T could not be properly characterized
as willful or in bad faith as she was moved to act the way
she did mainly because she wanted to retain a permanent
job in a stable company. In other words, she was practically
forced by that very same illegal company policy into
misrepresenting her civil status for fear of being disqualified
from work. While loss of confidence is a just cause for
termination of employment, it should not be simulated. It
must rest on an actual breach of duty committed by the
employee and not on the employers caprices. Furthermore,
it should never be used as a subterfuge for causes which are
improper, illegal, or unjustified.
Petitioners policy is not only in derogation of the provisions
 of Article 136 of the Labor Code on the right of a woman to
be free from any kind of stipulation against marriage in
connection with her employment, but it likewise assaults
good morals and public policy, tending as it does to deprive
a woman of the freedom to choose her status, a privilege
that by all accounts inheres in the individual as an intangible
and inalienable right. Hence, while it is true that the parties
to a contract may establish any agreements, terms, and
conditions that they may deem convenient, the same should
not be contrary to law, morals, good customs, public order,
or public policy. Carried to its logical consequences, it may
even be said that petitioners policy against legitimate
marital bonds would encourage illicit or common-law
relations and subvert the sacrament of marriage.
Star Paper Corporation vs. Simbol, G.R. No, 164774,
April 12, 2006

We note that since the finding of a bona fide occupational

qualification justifies an employers no-spouse rule, the
exception is interpreted strictly and narrowly by these state
courts. There must be a compelling business necessity for
which no alternative exists other than the discriminatory
practice. To justify a bona fide occupational qualification, the
employer must prove two factors: (1) that the employment
qualification is reasonably related to the essential operation
of the job involved; and, (2) that there is a factual basis for
believing that all or substantially all persons meeting the
qualification would be unable to properly perform the duties
of the job. The concept of a bona fide occupational
qualification is not foreign in our jurisdiction. We employ the
standard of reasonableness of the company policy which is
parallel to the bona fide occupational qualification
requirement. We passed on the validity of the policy of a
 pharmaceutical company prohibiting its employees from
marrying employees of any competitor company.
Post-employment ban
Ferrazzinni vs. Gsell, G.R. No. L-10712, August 10,
1916, En Banc

The contract entered into wherein the plaintiff agreed to pay

to the defendant P10,000 as liquidated damages for each
and every breach of a clause of the contract which provided
that the plaintiff should not enter into any enterprise
whatever in the Philippine Islands except by special written
permission of the defendant, during the period of
employment and for a term of five years from and after the
termination of the employment without regard to the cause
of such termination, was clearly one in undue and
unreasonable restraint of trade and therefore void as against
public policy.

Del Castillo vs. Richmond, G.R. No. L-21127, February

9, 1924, En Banc

Contracts by virtue of which one person promises not to

engage in any particular business for a definite time and
within a limited space are generally held to be valid. The rule
is well established that a contract in restraint of trade is valid
providing there is a limitation upon either time or space. The
public welfare, of course, must always be considered, and if
it be not involved and the restraint upon one party is not
greater than the protection to the other requires, such
contract would be sustained. The test is whether the
restraint is reasonably necessary for the protection of the
contracting parties. If the restraint is reasonably necessary
to protect the interest of the parties, it will be upheld.
 Rivera vs. Solidbank Corporation, G.R. No. 163269,
April 19, 2006

Retirement plans, in light of the constitutional mandate of

affording full protection to labor, must be liberally construed
in favor of the employee, it being the general rule that
pension or retirement plans formulated by the employer are
to be construed against it. Retirement benefits, after all, are
intended to help the employee enjoy the remaining years of
his life, releasing him from the burden of worrying for his
financial support, and are a form of reward for being loyal to
the employer.
Moreover, on the face of the Undertaking, the post-
retirement competitive employment ban is unreasonable
because it has no geographical limits; respondent is barred
from accepting any kind of employment in any competitive
bank within the proscribed period. Although the period of
one year may appear reasonable, the matter of whether the
restriction is reasonable or unreasonable cannot be
ascertained with finality solely from the terms and conditions
of the Undertaking, or even in tandem with the Release,
Waiver and Quitclaim.
Preventive Suspension
Gatbonton v. NLRC, G.R. No. 146779, January 23, 2006

Preventive suspension is a disciplinary measure for the

protection of the companys 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 to justify an
employees preventive suspension, the latter is entitled to
the payment of salaries during the time of preventive
suspension.
Under the Labor Code, petitioners preventive suspension
finds no valid justification. As provided in Section 8, Rule
XXIII, Book V of the Omnibus Rules Implementing the Labor
Code: Sec. 8. Preventive Suspension. The employer may
place the worker concerned under preventive suspension if
his continued employment poses a serious threat to the life
or property of the employer or of his co-workers. As
previously stated, there is nothing on record which shows
that respondent MIT imposed the preventive suspension on
petitioner as his continued employment poses a serious
threat to the life or property of the employer or of his co-
workers; therefore, his preventive suspension is not justified.
Consequently, the payment of wages during his 30-day
preventive suspension, i.e., from January 11, 1999 to
February 10, 1999, is in order.

Termination of Employment

How to Reckon Six Months

CALS Poultry Supply Corporation vs.

Roco, G.R. No. 150660, July 30, 2002

The court agreed with CALS contention as upheld by both

the Labor Arbiter and the NLRC that Candelarias services
was terminated within and not beyond the 6-month
probationary period. In Cebu Royal v. Deputy Minister of
Labor, the Courts computation of the 6-month probationary
 period is reckoned from the date of appointment up to the
same calendar date of the 6th month following.

Alcira vs. NLRC, G.R. No. 149859, June

9, 2004

In CALS Poultry Supply Corp. v. Roco, it was held that the

computation of the 6-month probationary period is reckoned
from the date of appointment up to the same calendar date
of the 6th month following. In short, since the number of
days in each particular month was irrelevant, Alciras was still
a probationary employee when respondent Middleby opted
not to regularize him on November 20, 1996.

Mitsubishi Motors Philippines

Corporation vs. Chrysler Philippines Labor Union, G. R. No.
148738, June 29, 2004

Paras received the letter of termination on November 26,

1996, the same was served on the 183rd day or after the
expiration of the six-month probationary period. The CA
stated that since he was allowed to work beyond the
probationary period, Paras became a regular employee.

Reasonable standards made known by the employer

to the employee at the time of engagement

Alcira vs. NLRC, G.R. No. 149859, June

9, 2004

Apprising the employee that he will be subjected to a

performance evaluation on a particular date after his hiring
 is substantial compliance with the legal requirement of
making known to the probationary employee the standards
that would qualify the employee for regular employment.

Aberdeen Court, Inc. v. Agustin, Jr.,

G.R. No. 149371, April 13, 2005

NO. It can be gleaned from Article 281 of the Labor Code

that there are two grounds to legally terminate a
probationary employee. It may be done either: a) for a just
cause or b) when employee fails to qualify as a regular
employee in accordance with reasonable standards made
known by the employer to the employee at the start of the
employment.

However, the failure of the company to apprise the

employee upon engagement should not be used to
exculpate a probationary employee who acts in a manner
contrary to basic knowledge and common sense and
prudence and due diligence imposed upon him not to readily
accept the report handed to him by the workers of
Centigrade Industries. Respondents omission, lack of
concern and grasp of basic knowledge and common sense,
complainant has shown himself to be undeserving of
continued employment from probationary employee to
regular employee.

Security of Tenure
 Dela Cruz vs. NLRC, G.R. No. 145417,
December 11, 2003

As a probationary employee, enjoyed only temporary

employment status. In general terms, this meant that he
was terminable anytime, permanent employment not having
been attained in the meantime. The employer could well
decide he no longer needed the probationary employees
services or his performance fell short of expectations, etc. As
long as the termination was made before the expiration of
the six-month probationary period, the employer was well
within his rights to sever the employer-employee
relationship. A contrary interpretation would defect the clear
meaning of the term probationary. In this case, respondent
Shemberg had good reason to terminate petitioners
employment and that was his dishonesty.

Alcira vs. NLRC, G.R. No. 149859, June

9, 2004

It is settled that even if probationary employees do not

enjoy permanent status, they are accorded the constitutional
protection of security of tenure. But this constitutional
protection ends on the expiration of the probationary period.
On that date, the parties are free to either renew or
terminate their contract of employment.

Here, respondent Middleby exercised its option not to renew

the contract when it informed petitioner on the last day of
his probationary employment that it did not intend to grant
him a regular status.

Cathay Pacific Airways, Limited vs.

 Marin, G.R. No. 148931, September 12, 2006

It is settled that a probationary employee enjoys only a

temporary employment status, not a permanent status. In
general terms, he is terminable anytime as long as such
termination is made before the expiration of the six-month
probationary period. The employment of a probationary
employee may only be terminated either (1) for a just
cause; or (2) when the employee fails to qualify as a regular
employee in accordance with the reasonable standards
made known to him by the employer at the start of his
employment. The power of the employer to terminate an
employee on probation is thus subject to the following
conditions: (1) it must be exercised in accordance with the
specific requirements of the contract; (2) the dissatisfaction
on the part of the employer must be real and in good faith,
not prejudicial so as to violate the contract or the law; and
(3) there must be no unlawful discrimination in the
dismissal. The burden of proving just or valid cause for
dismissing an employee rests on the employer.

When to End the Probationary Period

Espina, et. al., vs. CA, G.R. No. 164582,

March 28, 2007

Petitioners were terminated prior to the expiration of their

probationary contracts. As probationary employees, they
enjoyed only temporary employment status. In general
 terms, this meant that they were terminable anytime,
permanent employment not having been attained in the
meantime. The employer could well decide if he no longer
needed the probationarys service or his performance fell
short of expectations, as a probationary employee is one
who, for a given period of time, is under observation and
evaluation to determine whether or not he is qualified for
permanent employment. During the probationary period,
the employer is given the opportunity to observe the skill,
competence and attitude of the employee to determine if he
has the qualification to meet the reasonable standards for
permanent employment. The length of time is immaterial in
determining the correlative rights of both the employer and
the employee in dealing with each other during said period.
Thus, as long as the termination was made before the
expiration of the six-month probationary period, the
employer was well within his rights to sever the employer-
employee relationship. A contrary interpretation would
defeat the clear meaning of the term probationary.

Extension of the Probationary Period

Servidad vs. NLRC, G.R. No. 128682,

March 18, 1999

As to the private respondents statement that the one-year

period stipulated in subject contract was to enable petitioner
to acquire the skill necessary for the job. In effect, what
respondent employer theorized upon is that the one-year
term of employment is probationary. If the nature of the job
did actually necessitate at least one year for the employee to
acquire the requisite training and experience, the same
could not be a valid probationary employment as it falls
 short of the requirement of Article 281[10] of the Labor
Code. It was not brought to light that the petitioner was duly
informed at the start of his employment, of the reasonable
standards under which he could qualify as a regular
employee.

Kinds of employment

Bernardo, et. al., vs. NLRC, G.R. No.

122917, July 12, 1999

The Magna Carta for Disabled Persons mandates that

a qualified disabled employee should be given the same
terms and conditions of employment as a qualified able-
bodied person. Section 5 of the Magna Carta provides:

Section 5. Equal Opportunity for Employment.No

disabled person shall be denied access to opportunities
for suitable employment. A qualified disabled
employee shall be subject to the same terms and
conditions of employment and the same compensation,
privileges, benefits, fringe benefits, incentives or
allowances as a qualified able bodied person.

The fact that the employees were qualified disabled persons

necessarily removes the employment contracts from the
ambit of Article 80. Since the Magna Carta accords them the
rights of qualified able-bodied persons, they are thus
covered by Article 280 of the Labor Code
 Regular employment

Paguio vs. NLRC, G.R. No. 147816, May

9, 2003

Where a person has rendered at least one year of service,

regardless of the nature of the activity performed or of
whether it is continuous or intermittent, the employment is
considered regular as long as the activity exists, it not being
indispensable that he be first issued a regular appointment
or be formally declared as such before acquiring a regular
status.

Conti vs. NLRC, G.R. No. 119253, April

10, 1997

Petitioners had been employed with private

respondent Corfarm since 1991. They had been discharging
their functions as head of commissary and store supervisor,
respectively, for more than one (1) year. Under the law
therefore, they are deemed regular employees and thus
entitled to security of tenure, as provided in Article 279 of
the Labor Code

By probationary employment

Casual employment

Conti vs. NLRC, G.R. No. 119253, April

10, 1997

The Court has held that if the employee has been

performing the job for at least one (1) year, even if the
 performance is not continuous but intermittent; the law
deems the repeated and continuing need for its performance
as sufficient evidence of the necessity if not indispensability
of that activity to the business of his employer. Hence, the
employment is also considered regular, but only with respect
to such activity, and while such activity exists. The law does
not provide the qualification that the employee must first be
issued a regular appointment or must first be formally
declared as such before he can acquire a regular employee
status. Obviously, where the law does not distinguish, no
distinction should be drawn.

Fabela, et. al. vs. San Miguel

Corporation, G.R. 150658, February 9, 2007

Although Article 280 does not expressly recognize

employment for a fixed period, which is distinct from
employment which has been fixed for a specific project or
undertaking, it has been clarified that employment for a
fixed period is not in itself illegal. Even if the duties of an
employee consist of activities usually necessary or desirable
in the usual business of the employer, it does not necessarily
follow that the parties are forbidden from agreeing on a
period of time for the performance of such activities through
a contract of employment for a fixed term.

Seasonal employment
Requisites to attain regular employment

Hacienda Fatima vs. Nacional Federation

of Sugarcane Workers Food and General Trade, G.R. No.
149440, January 20, 2003
 The appellate court found neither rhyme nor reason in
petitioners argument that it was the workers themselves
who refused to or were choosy in their work. As found by
the NLRC, the record of this case is replete with
complainants persistence and dogged determination in
going back to work.

The CA likewise concurred with the NLRCs finding that

petitioners were guilty of unfair labor practice. The court
uphels the ruling of the CA.

Project employment
Indicators of project employment

Cocomangas Hotel Beach Resort vs.

Visca, G.R. No. 167045, August 29, 2008

A project employee is one whose 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 service
to be performed is seasonal in nature and the employment is
for the duration of the season. Before an employee hired on
a per-project basis can be dismissed, a report must be made
to the nearest employment office, of the termination of the
services of the workers every time completes a project,
pursuant to Policy Instruction No. 20.

An employment ceases to be coterminous with specific

projects when the employee is continuously rehired due to
the demands of employers business and re-engaged for
 many more projects without interruption. Once a project or
work pool employee has been: (1) continuously, as opposed
to intermittently, rehired by the same employer for the same
tasks or nature of tasks; and (2) these tasks are vital,
necessary and indispensable to the usual business or trade
of the employer, then the employee must be deemed a
regular employee, pursuant to Article 280 of the Labor Code
and jurisprudence.

Equipment Technical Services vs. CA,

G.R. No. 157680, October 8, 2008

The principal test for determining whether an employee is

properly characterized as project employee, as distinguished
from regular employee, is whether or not the project
employee was assigned to carry out a specific project or
undertaking, the duration and scope of which were specified
at the time the employees were engaged for that project and
the filing of an accomplishment or termination report thereof.

Caseres vs. Universal Robina Sugar

Milling Corporation, G.R.No. 159343, September 28, 2007

The principal test for determining whether an employee is a

project employee or a regular employee is whether 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. A true project employee should be assigned to a
project which begins and ends at determined or
determinable times, and be informed thereof at the time of
 hiring.

Work Pool

Philippine National Construction

Corporation vs. NLRC, G.R. No. 85323, June 20, 1989

Members of a work pool from which a construction company

draws its project employees, if considered employee of the
construction company while in the work pool, are non-
project employees or employees for an indefinite period. If
they are employed in a particular project, the completion of
the project or any phase thereof will not mean severance of
employer-employee relationship.

A project employee is one whose "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."

Fernandez vs. NLRC, G.R. No. 106090,

February 28, 1994

On the matter of the being part of a work pool,the court

held that petitioner failed to consider the requirement in
Policy Instruction No. 20 that to qualify as member of a work
pool, the worker must still be considered an employee of the
construction company while in the work pool. In other
 words, there must be proof to the effect that petitioner was
under an obligation to be always available on call of private
respondent and that he was not free to offer his services to
other employees. Unfortunately, petitioner miserably failed
to introduce any evidence of such nature during the times
when there were no project.

Maraguinot, et. al. vs. NLRC, G.R. No.

120969, January 22, 1998

A project employee or a member of a work pool may acquire

the status of a regular employee when the ff. concur: a)
There is a continuous rehiring of project employees even
after cessation of the project; b)The tasks performed are
vital, necessary and indispensable to the usual business or
trade of the employer. The length of time during which the
employee was continuously rehired is not controlling, but
merely serves as a badge of regular employment.

Citing Lao vs. NLRC, the court held that a work pool may
exist although the workers in the pool do not receive
salaries and are free to seek other employment during
temporary breaks in the business, provided that the workers
shall be available when called to report for a project.
Although primarily applicable to regular seasonal workers,
this setup can likewise be applied to project workers in so
far as the effect of temporary cessation of work is
concerned.
Once a project or work pool employee has been (a)
continuously, as opposed to intermittently, rehired by the
same employer for the same tasks or nature of tasks; (b)
these tasks are vital, necessary, and indispensable to the
usual business or trade of the employer, then the employee
 must be deemed a regular employee, pursuant to Article 280
of the Labor Code and jurisprudence.

Can project employees be regular employees?

Magcalas, et. al. vs. NLRC, G.R. No.

100333, March 13, 1997

Regular employees cannot at the same time be project

employees. Article 280 of the Labor Code states that regular
employees are those whose work is necessary or desirable
to the usual business of the employer. The two exceptions
following the general description of regular employees refer
to either project or seasonal employees.

Fixed term employment

Requisites for validity

Brent School, Inc., vs. Zamora, G.R. No.

48494, February 5, 1990, En Banc

Since the entire purpose behind the development of

legislation culminating in the present Article 280 of the Labor
Code clearly appears to have been, as already observed, to
prevent circumvention of the employee's right to be secure
in his tenure, the clause in said article indiscriminately and
completely ruling out all written or oral agreements
conflicting with the concept of regular employment as
defined therein should be construed to refer to the
substantive evil that the Code itself has singled out:
agreements entered into precisely to circumvent security of
 tenure. It should have no application to instances where a
fixed period of employment was agreed upon knowingly and
voluntarily by the parties, without any force, duress or
improper pressure being brought to bear upon the employee
and absent any other circumstances vitiating his consent, or
where it satisfactorily appears that the employer and
employee dealt with each other on more or less equal terms
with no moral dominance whatever being exercised by the
former over the latter. Unless thus limited in its purview, the
law would be made to apply to purposes other than those
explicitly stated by its framers; it thus becomes pointless and
arbitrary, unjust in its effects and apt to lead to absurd and
unintended consequences.

Philippine National Oil Company-Energy

Development Corporate vs. NLRC, G.R. No. 97747, March
31, 1994
Two guidelines by which fixed contracts of employments can
be said NOT to circumvent security of tenure, are either: 1)
The fixed period of employment was knowingly and
voluntarily agreed upon by the parties, without any force,
duress or improper pressure being brought to bear upon the
employee and absent any other circumstances vitiating his
consent; or 2) It satisfactorily appears that the employer and
employee dealt with each other on more or less equal terms
with no moral dominance whatever being exercised by the
former on the latter.

Termination
 Blancaflor vs. NLRC, G.R. No. 101013,
February 2, 1993

Petitioners herein were dismissed by reason of the expiration

of their contracts of employment. Petitioners' appointments
as dean, department heads and institute secretaries were for
fixed terms of definite periods as shown by their respective
contracts of employment, which all expired on the same
date, May 31, 1988.

Under the reorganizational setup pursuant to the 1984 RRR

Program, all employees including herein petitioners were
considered resigned. The guidelines of the retrenchment
program as approved by the Minister of Labor specifically
states that under the reorganizational setup all the
employees of the university would be considered separated
or retired "with corresponding grants of termination pay or
retirement benefits, whichever is higher," and all would be
rehired except those whose present positions would be
affected by the proposed reorganizational changes. It is
apparent that said RRR Program calls for the separation and
retirement of all personnel of respondent GAUF with the
corresponding grants of termination pay or retirement
benefits, whichever is higher, regardless of whether or not
they will be rehired by the university.

Successive renewal / Employment on as the need

arises basis

Philips Semiconductors, Inc., vs.

Fadriquela, G.R. No. 141717, April 14, 2004

Article 280 of the Labor Code of the Philippines was

emplaced in our statute books to prevent the circumvention
by unscrupulous employers of the employees right to be
secure in his tenure by indiscriminately and completely ruling
out all written and oral agreements inconsistent with the
concept of regular employment defined therein. The
language of the law manifests the intent to protect the
tenurial interest of the worker who may be denied the rights
and benefits due a regular employee because of lopsided
agreements with the economically powerful employer who
can maneuver to keep an employee on a casual or
temporary status for as long as it is convenient to it. In
tandem with Article 281 of the Labor Code, Article 280 was
designed to put an end to the pernicious practice of making
permanent casuals of our lowly employees by the simple
expedient of extending to them temporary or probationary
appointments, ad infinitum.

The two kinds of regular employees under the law are (1)
those engaged to perform activities which are necessary or
desirable in the usual business or trade of the employer; and
(2) those casual employees who have rendered at least one
year of service, whether continuous or broken, with respect
to the activities in which they are employed. The primary
standard to determine a regular employment is the
reasonable connection between the particular activity
performed by the employee in relation to the business or
trade of the employer. The test is whether the former is
usually necessary or desirable in the usual business or trade
of the employer. If the employee has been performing the
job for at least one year, even if the performance is not
continuous or merely intermittent, the law deems the
repeated and continuing need for its performance as
sufficient evidence of the necessity, if not indispensability of
 that activity to the business of the employer. Hence, the
employment is also considered regular, but only with respect
to such activity and while such activity exists. The law does
not provide the qualification that the employee must first be
issued a regular appointment or must be declared as such
before he can acquire a regular employee status.

Validity of a Pre-termination Clause

Price vs. Innodata Phils., Inc., G.R. No.

178505, September 30, 2008

It is also true that while certain forms of employment require

the performance of usual or desirable functions and exceed
one year, these do not necessarily result in regular
employment under Article 280 of the Labor Code. Under the
Civil Code, fixed-term employment contracts are not limited,
as they are under the present Labor Code, to those by
nature seasonal or for specific projects with predetermined
dates of completion; they also include those to which the
parties by free choice have assigned a specific date of
termination. The decisive determinant in term employment is
the day certain agreed upon by the parties for the
commencement and termination of their employment
relationship, a day certain being understood to be that which
must necessarily come, although it may not be known when.
Seasonal employment and employment for a particular
project are instances of employment in which a period,
where not expressly set down, is necessarily implied.

Project employees are those workers hired (1) for a

specific project or undertaking, and wherein (2) the
completion or termination of such project has been
 determined at the time of the engagement of the employee.
Further attempting to exonerate itself from any liability for
illegal dismissal, INNODATA contends that petitioners were
project employees whose employment ceased at the end of
a specific project or undertaking.

Loralei Halili v. Justice for Children

International, et. al., G.R. No. 194906, September 9, 2015

Under Section 3, Article XVI of the Constitution, it is the

policy of the State to assure the workers of security of
tenure and free them from the bondage of uncertainty of
tenure woven by some employers into their contracts of
employment.1wphi1 This was exactly the purpose of the
legislators in drafting Article 280 of the Labor Code - to
prevent the circumvention by unscrupulous employers of the
employee's right to be secure in his tenure by
indiscriminately and completely ruling out all written and oral
agreements inconsistent with the concept of regular
employment.
Here, it is clear that the first requisite of legal cause was not
complied with by JFCI. No just or authorized cause was
proven by substantial evidence in support of its invocation of
the termination clause stated in its contract with Halili. As
such, the pre-termination of the contract was infirm. Thus,
considering further that respondents' argument on its
purported loss of trust and confidence in Halili cannot be
taken into account at this stage since it was belatedly raised
for the first time on appeal,39 the NLRC did not gravely
abuse its discretion in ruling that Halili 's dismissal was
illegal. The CA's issuance of a writ of certiorari was perforce
improper.
 Substantive due process
Just causes
Serious misconduct or willful disobedience

Dimabayao vs. NLRC, G.R. No. 122178,

February 25, 1999

Willful disobedience of the employers lawful orders, as a

just cause for dismissal of an employee envisages the
concurrence of at least two requisites: (1) the employees
assailed conduct must have been willful being characterized
by a wrongful and perverse attitude; and (2) the order
violated must have been reasonable, lawful, made known to
the employee and must pertain to the duties which he had
been engaged to discharge.

We cannot sustain the NLRC for upholding private

respondents dismissal of petitioner. Petitioners act of
leaving his work place to relieve himself can hardly be
characterized as abandonment, much less a willful or
intentional disobedience of company rules since he was
merely answering the call of nature over which he had no
control. Restraining ones bowel movement can result in
great discomfort and affect adversely the efficiency, and
even the health, of the worker. Petitioners disobedience to
his employers orders can easily be categorized as trivial and
unimportant, and as such, does not merit a penalty as harsh
as dismissal.

Bascon vs. CA, G.R. No. 144899,

February 5, 2004
 The elements of gross insubordination are the following.
(1) reasonableness and lawfulness of the order or directive,
(2) sufficiency of knowledge on the part of the employee of
such order, and (3) the connection of the order with the
duties which the employee had been engaged to discharge.

Willful disobedience of the employers lawful orders, as a

just cause for dismissal of an employee, envisages the
concurrence of at least two requisites: (1) the employees
assailed conduct must have been willful, that is,
characterized by a wrongful and perverse attitude; and (2)
the order violated must have been reasonable, lawful, made
known to the employee and must pertain to the duties which
he had been engaged to discharge.

Nagkakaisang Lakas ng Manggagawa sa

Keihin (NLMK-OLALIA-KMU) vs. Keihin Philippines
Corporation, G.R. No. 171115, August 09, 2010

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 under the law, (a) it must be
serious, (b) must relate to the performance of the
employees duties; and (c) must show that the employee has
become unfit to continue working for the employer.

Fujitsu Computer Products Corporation

of the Philippines vs. CA, G.R. No. 158232, March 31, 2005

Misconduct has been defined as improper or wrong conduct.

It is the transgression of some established and definite rule
of action, a forbidden act, a dereliction of duty, willful in
character, and implies wrongful intent and not mere error of
judgment. The misconduct to be serious must be of such
grave and aggravated character and not merely trivial and
unimportant. Such misconduct, however serious, must
nevertheless be in connection with the employees work to
constitute just cause for his separation. Thus, for misconduct
or improper behavior to be a just cause for dismissal, (a) it
must be serious; (b) must relate to the performance of the
employees duties; and (c) must show that the employee has
become unfit to continue working for the employer. Indeed,
an employer may not be compelled to continue to employ
such person whose continuance in the service would be
patently inimical to his employers interest.

The Court finds that respondent Alvarezs act of sending an

e-mail message as an expression of sympathy for the plight
of a superior can hardly be characterized as serious
misconduct as to merit the penalty of dismissal. * * * There
is no showing that the sending of such e-mail message had
any bearing or relation on respondent Alvarezs competence
and proficiency in his job. To reiterate, in order to consider it
a serious misconduct that would justify dismissal under the
law, the act must have been done in relation to the
performance of his duties as would show him to be unfit to
continue working for his employer. Moreover, while
allegations of a frame-up were made against Saros, the e-
mail message does not contain a single malicious imputation
or charge against petitioner FCPP, or petitioner Espinosa.

Sexual Harassment
 Digitel Telecommunications
Philippines, Inc., v. Soriano, G.R. No. 166039, June 26, 2006

While, as this Court stated in Philippine Aelous, 331 SCRA

237 (2000), there is, strictly speaking, no fixed period within
which an alleged victim of sexual harassment may file a
complaint, it does not mean that she or he is at liberty to file
one anytime she or he wants to. Surely, any delay in filing a
complaint must be justifiable or reasonable as not to cast
doubt on its merits. At all events, it is settled that the only
test of whether an alleged fact or circumstance is worthy of
credence is the common experience, knowledge and
observation of ordinary men.

Philippine Aeolus Automotive

United Corporation. v. NLRC, G.R. No. 124617, April 28,
2000

The gravamen of the offense in sexual harassment is not the

violation of the employees sexuality but the abuse of power
by the employer. Any employee, male or female, may
rightfully cry foul provided the claim is well substantiated.
Strictly speaking, there is no time period within which he or
she is expected to complain through the proper channels.
The time to do so may vary depending upon the needs,
circumstances, and more importantly, the emotional
threshold of the employee.

Private respondent admittedly allowed four (4) years to pass

before finally coming out with her employers sexual
impositions. Not many women, especially in this country, are
made of the stuff that can endure the agony and trauma of
a public, even corporate, scandal. If petitioner corporation
 had not issued the third memorandum that terminated the
services of private respondent, we could only speculate how
much longer she would keep her silence. Moreover, few
persons are privileged indeed to transfer from one employer
to another. The dearth of quality employment has become a
daily monster roaming the streets that one may not be
expected to give up ones employment easily but to hang on
to it, so to speak, by all tolerable means. Perhaps, to private
respondents mind, for as long as she could outwit her
employers ploys she would continue on her job and consider
them as mere occupational hazards. This uneasiness in her
place of work thrived in an atmosphere of tolerance for four
(4) years, and one could only imagine the prevailing anxiety
and resentment, if not bitterness, that beset her all that
time. But William Chua faced reality soon enough. Since he
had no place in private respondents heart, so must she have
no place in his office. So, he provoked her, harassed her,
and finally dislodged her; and for finally venting her pent-up
anger for years, he found the perfect reason to terminate
her.

Aquino v. Acosta, A.M. No. CTA-01-

1, April 2, 2002, En Banc

We have reviewed carefully the records of this case and

found no convincing evidence to sustain complainants
charges. What we perceive to have been committed by
respondent judge are casual gestures of friendship and
camaraderie, nothing more, nothing less. In kissing
complainant, we find no indication that respondent was
motivated by malice or lewd design. Evidently, she
misunderstood his actuations and construed them as work-
related sexual harassment under R.A. 7877.
 Indeed, from the records on hand, there is no showing that
respondent judge demanded, requested or required any
sexual favor from complainant in exchange for favorable
compensation, terms, conditions, promotion or privileges
specified under Section 3 of R.A. 7877. Nor did he, by his
actuations, violate the Canons of Judicial Ethics or the Code
of Professional Responsibility. While we exonerate
respondent from the charges herein, however, he is
admonished not to commit similar acts against complainant
or other female employees of the Court of Tax Appeals,
otherwise, his conduct may be construed as tainted with
impropriety.

Domingo v. Rayala, G.R. No.

155831, February 18, 2008

That Rayala committed the acts complained ofand was

guilty of sexual harassmentis, therefore, the common
factual finding of not just one, but three independent
bodies: the Committee, the OP and the CA. It should be
remembered that when supported by substantial evidence,
factual findings made by quasi-judicial and administrative
bodies are accorded great respect and even finality by the
courts. The principle, therefore, dictates that such findings
should bind us.

This Court has held that, even in criminal cases, the

designation of the offense is not controlling, thus: What is
controlling is not the title of the complaint, nor the
designation of the offense charged or the particular law or
part thereof allegedly violated, these being mere conclusions
of law made by the prosecutor, but the description of the
 crime charged and the particular facts therein recited. The
acts or omissions complained of must be alleged in such
form as is sufficient to enable a person of common
understanding to know what offense is intended to be
charged, and enable the court to pronounce proper
judgment. No information for a crime will be sufficient if it
does not accurately and clearly allege the elements of the
crime charged. Every element of the offense must be stated
in the information. What facts and circumstances are
necessary to be included therein must be determined by
reference to the definitions and essentials of the specified
crimes. The requirement of alleging the elements of a crime
in the information is to inform the accused of the nature of
the accusation against him so as to enable him to suitably
prepare his defense. It is noteworthy that under AO 250,
sexual harassment amounts to disgraceful and immoral
conduct. Thus, any finding of liability for sexual harassment
may also be the basis of culpability for disgraceful and
immoral conduct

CSC v. Belagan, G. R. No. 132164,

October 19, 2004, En Banc

Misconduct means intentional wrongdoing or deliberate

violation of a rule of law or standard of behavior, especially
by a government official. To constitute an administrative
offense, misconduct should relate to or be connected with
the performance of the official functions and duties of a
public officer.

In grave misconduct as distinguished from simple

misconduct, the elements of corruption, clear intent to
violate the law or flagrant disregard of established rule, must
 be manifest. Corruption as an element of grave misconduct
consists in the act of an official or fiduciary person who
unlawfully and wrongfully uses his station or character to
procure some benefit for himself or for another person,
contrary to duty and the rights of others. This is apparently
present in respondents case as it concerns not only a stolen
kiss but also a demand for a date, an unlawful
consideration for the issuance of a permit to operate a pre-
school. Respondents act clearly constitutes grave
misconduct, punishable by dismissal.

Can gross negligence, although not habitual, still be a

ground for termination?

School of the Holy Spirit of Quezon City

vs. Taguiam, G.R. No. 165565, July 14, 2008

Under Article 282 of the Labor Code, gross and habitual

neglect of duties is a valid ground for an employer to
terminate an employee. Gross negligence implies a want or
absence of or a failure to exercise slight care or diligence, or
the entire absence of care. It evinces a thoughtless
disregard of consequences without exerting any effort to
avoid them. Habitual neglect implies repeated failure to
perform ones duties for a period of time, depending upon
the circumstances.

In this case, the damage went as far as claiming the life of a

child; The sufficiency of the evidence as well as the resultant
damage to the employer should be considered in the
dismissal of the employee.Respondents negligence,
although gross, was not habitual. In view of the considerable
 resultant damage, however, we are in agreement that the
cause is sufficient to dismiss respondent. This is not the first
time that we have departed from the requirements laid
down by the law that neglect of duties must be both gross
and habitual.

PAL vs. NLRC, G.R. No. 82471, February

18, 1991

One must admit that towing an aircraft is a group activity

necessitating group coordination. This is explicit in
petitioners Engineering and Maintenance Manual which
states, that the tug operator must undertake and/or
continue on towing/pushing procedure only when positive
visual contact with all guidemen is possible. The use of, all
necessary guidemen indicates plurality or group
coordination. Thus, instead of relying solely on the signals of
Camina, Pinuela should have also checked with the other
ground crew personnel. Particularly, Pinuela should have
relied on Manalaysay. Exhibit 2 distinctly shows the relative
position of the plane, ground crew personnel and the
airports aerobridge when the incident happened.
Manalaysay, who was near the marked line and the nearest
obstruction which was the aerobridge and the parked service
vehicle, was strategically located. For Pinuela to claim that
he relied on Camina for signals is not credible, for he
demonstrated before the Labor Arbiter that he had to turn
180 degrees to see Camina who was directly at his back.

Lastly, Pinuela should not compare the penalty of dismissal

imposed on him in relation to lesser sanctions previously
meted by PAL on its other employees. We are solely
concerned here with the sufficiency of the evidence
 surrounding Pinuelas dismissal. Besides, Pinuelas examples
do not involve a plane with a scheduled flight. A mere delay
on petitioners flight schedule due to aircraft damage entails
problems like hotel accommodations for its passengers, re-
booking, the possibility of law suits, and payment of special
landing fees not to mention the soaring costs of replacing
aircraft parts. All told, Pinuelas gross negligence which
called for dismissal is evident and it was grave abuse of
discretion on the part of the labor tribunal to have ruled
otherwise.

Fuentes vs. NLRC, G.R. No. L-75955,

October 28, 1988

Petitioner Fuentes cannot invoke private respondents

alleged contributory negligence as there was no direct causal
connection between the negligence of the bank in not
conducting the investigation and the loss complained of. In a
legal sense, negligence is contributory only when it
contributes proximately to the injury, and not simply a
condition for its occurrence.

In the case at bar, the banks inaction merely created a

condition under which the loss was sustained. Regardless of
whether there was a failure to investigate, the fact is that
the money was lost in the first place due to petitioners gross
negligence. Such gross negligence was the immediate and
determining factor in the loss.

Excessive Absences

Procter and Gamble Philippines vs.

Bondesto, G.R. No. 139847, March 5, 2004
 The Court reiterates the much-repeated rule that the
findings of fact of the Court of Appeals, where there is
absolute agreement with those of the NLRC, are accorded
not only respect but even finality and are deemed binding
upon this Court so long as they are supported by substantial
evidence.

Misconduct has been defined as the transgression of some

establishedand definite rule of action, a forbidden act, a
dereliction of duty, willful in character, and implies wrongful
intent and not mere error in judgment. On the other hand,
willful disobedience envisages the concurrence of at least
two (2) requisites: the employees assailed conduct has been
willful or intentional, the willfulness being characterized by a
wrongful and perverse attitude; and the order violated
must have been reasonable, lawful, made known to the
employee and must pertain to the duties which he had been
engaged to discharge.

Del Monte Phils., Inc., vs. Velasco, G.R.

No. 153477, March 6, 2007

The Filflex Industrial and Manufacturing Co. case is not

applicable, principally because the nature and gravity of the
illness involved in that casechronic asthmatic bronchitis
are different from the conditions that are present in the
instant case, which is pregnancy and its related illnesses.
The Court takes judicial notice of the fact that the condition
of asthmatic bronchitis may be intermittent, in contrast to
pregnancy which is a continuing condition accompanied by
various symptoms and related illnesses. Hence, as to the
former, if the medical certificate or other proof proffered by
 the worker fails to correspond with the dates of absence,
then it can be reasonably concluded that, absent any other
proof, such absences are unjustified. This is the ruling in
Filflex which cannot be applied in a straight-hand fashion in
cases of pregnancy which is a long-term condition
accompanied by an assortment of related illnesses.

Worldwide Papermills vs. NLRC, G.R.

No. 113081, May 12, 1995

In the case at bench, it is undisputed that respondent Edwin

P. Sabuya had within a span of almost six (6) years been
repeatedly admonished, warned and suspended for incurring
excessive unauthorized absences. Worse, he was not at
home but was out driving a pedicab to earn extra income
when the company nurse visited his residence after he filed
an application for sick leave. Such conduct of respondent
Edwin P. Sabuya undoubtedly constitutes gross and habitual
neglect of duties.

Our decision in Filipro, Inc. v. The Honorable Minister Blas F.

Ople, et al. does not preclude private respondents dismissal
for, unlike in Filipro, respondent Edwin P. Sabuya was given
notice that the next time he again exceeds his allowed
vacation and sick leaves or goes on absence without official
leave, he would be terminated from employment. Private
respondent did not heed the warning. His dismissal from
employment is, therefore, justified.

Quiambao vs. manila Electric Company,

G.R. No. 171023, December 18, 2009

The Labor Arbiter, the NLRC and the Court of Appeals found
 that petitioners unauthorized absences and repeated
infractions of company rules on employee discipline manifest
gross and habitual neglect of duty that merited the
imposition of the supreme penalty of dismissal from work.
Serious misconduct is said to be a transgression of some
established and definite rule of action, a forbidden act, a
dereliction of duty, willful in character, and indicative of
wrongful intent and not mere error of judgment. Oddly,
petitioner never advanced any valid reason to justify his
absences.

Following jurisprudence, it is held that a series of

irregularities when put together may constitute serious
misconduct. Hence, the petitioner is not entitled to
separation pay. The liberality of the law can never be
extended to the unworthy and undeserving.

Labudahon vs. NLRC, G.R. No. 112206,

December 11, 1995

In the case at bar, petitioners failure to file a motion for

reconsideration, for whatever reason, is a fatal procedural
defect that warrants the dismissal of his present petition.
The NLRC decision to indemnify petitioner is also affirmed,
as there is no evidence in the records to show that
respondent company observed the two-notice requirement
and hearing before dismissing petitioner. Applying the
Omnibus Rules Implementing the Labor Code on the
requirements of notice and hearing, this Court in the case of
Tiu vs. NLRC ruled: It is evident from the said provisions
that the employer is required to furnish an employee who is
to be dismissed two (2) written notices before such
termination. The first is the notice to apprise the employee
 of the particular acts or omissions for which his dismissal is
sought. This may be loosely considered as the proper
charge. The second is the notice informing the employee of
the employers decision to dismiss him. This decision,
however, must come only after the employee is given a
reasonable period from receipt of the first notice within
which to answer the charge, and ample opportunity to be
heard and defend himself with the assistance of his
representative, if he so desires.

In the case at bar, petitioner was given only a letter of

dismissal without earlier informing him of the charges
against him and without giving him the opportunity to
defend himself. Non-compliance by private respondent with
these requirements is a violation of the petitioners right to
due process.

Brew Master Internacional vs. National

Federation of Labor Unions, G.R. No. 119243, April 17, 1997

We then conclude that complainants prolonged absence

without approval does not fall within the definition of
abandonment and that his dismissal was unjustified. While
we do not decide here the validity of petitioners Rules and
Regulations on continuous, unauthorized absences, what is
plain is that it was wielded with undue haste resulting in a
deprivation of due process, thus not allowing for a
determination of just cause or abandonment. In this light,
petitioners dismissal was illegal. This is not to say that his
absence should go unpunished, as impliedly noted by the
NLRC in declining to award back wages. In the absence of
the appropriate offense which defines complainants
infraction in the companys Rules and Regulations, equity
 dictates that a penalty commensurate to the infraction be
imposed.

Abandonment of duties

Tan Brothers of Basilan City v. Escudero,

G.R. No. 188711, July 3, 2013

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 of the Labor Code. To constitute
abandonment, however, there must be a clear and
deliberate intent to discontinue ones 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.

It is, on the other hand, doctrinal that abandonment is a

matter of intention and cannot, for said reason, be lightly
inferred, much less legally presumed from certain equivocal
acts. Viewed in the light of Escuderos persistence in
reporting for work despite the irregular payment of her
 salaries starting July 2003, we find that her subsequent
failure to do so as a consequence of Tan Brothers non-
payment of her salaries in May 2004 is hardly evincive of an
intention to abandon her employment. Indeed, mere
absence or failure to report for work, even after a notice to
return work has been served, is not enough to amount to an
abandonment of employment. Considering that a notice
directing Escudero to return to work was not even issued in
the premises, we find that the CA committed no reversible
error in ruling out Tan Brothers defense of abandonment.

Aliten vs. U-Need Lumber and

Hardware, G.R. No. 168931, September 12, 2006

We agree with petitioners contention that the appellate

court committed a serious error and misapprehended the
facts when it ruled that he abandoned his work instead of
being illegally terminated by his employer. Abandonment, as
a just and valid ground for dismissal, requires the deliberate,
unjustified refusal of the employee to resume his
employment. Mere absence or failure to report for work is
not enough to amount to such abandonment. There must be
a concurrence of the intention to abandon and some overt
acts from which an employee may be deduced as having no
more intention to work. The contemplation to discontinue
the employment must be shown by clear proof that it was
deliberate and unjustified, a fact that herein private
respondent failed to evince.

Abandonment is a matter of intention and cannot lightly be

presumed from certain equivocal acts. There must be clear
proof of deliberate and unjustified intent to sever the
employment relationship. Certainly, the operative act is still
 the employees decisive act of putting an end to his
employment. Additionally, it must be stressed that the
burden of proving the existence of just cause for dismissing
an employee, such as abandonment, rests on the employer,
a burden private respondent failed to discharge.
Jurisprudence is replete with rulings that for abandonment
of work to exist, it is essential that (1) the employee must
have failed to report for work or must have been absent
without valid and justifiable reason; and (2) there must have
been an indisputable intention to sever the employer-
employee relationship manifested by some overt acts, with
the second element as the more determinative factor.

Hodieng Concrete Products vs. Emilia,

G.R. No. 149180, G.R. No. February 14, 2005

No such intent to abandon his work can be discerned from

respondents actuations. Neither are there overt acts which
could be considered manifestation of his desire to abandon
his work. On the contrary, respondents actions demonstrate
a desire on his part to continue his employment with
petitioners rather than to abandon it. As observed by the
Appellate Court, if respondent had truly forsaken his job, he
would not have bothered to file a complaint for illegal
dismissal against petitioners. Indeed, the filing of the
complaint for illegal dismissal negates the allegation of
abandonment.

Fraud or willful breach of trust (loss of trust and

confidence)

Farrol vs. CA, G.R. No. 133259,

 February 10, 2000

A perusal of RCPIs dismissal notice reveals that it merely

stated a conclusion to the effect that the withholding was
deliberately done to hide alleged malversation or
misappropriation without, however, stating the facts and
circumstances in support thereof. It further mentioned that
the position of cashier requires utmost trust and confidence
but failed to allege the breach of trust on the part of
petitioner and how the alleged breach was committed. On
the assumption that there was indeed a breach, there is no
evidence that petitioner was a managerial employee of
respondent RCPI. It should be noted that the term trust
and confidence is restricted to managerial employees. It
may not even be presumed that when there is a shortage,
there is also a corresponding breach of trust. Cash shortages
in a cashiers work may happen, and when there is no proof
that the same was deliberately done for a fraudulent or
wrongful purpose, it cannot constitute breach of trust so as
to render the dismissal from work invalid.

P.J. Lhuillier Inc., vs. NLRC, G.R.

No. 158758, April 29, 2005

The right of an employer to dismiss employees on the

ground of loss of trust and confidence, however, must not
be exercised arbitrarily and without just cause. Unsupported
by sufficient proof, loss of confidence is without basis and
may not be successfully invoked as a ground for dismissal.
Loss of confidence as a ground for dismissal has never been
intended to afford an occasion for abuse by the employer of
its prerogative, as it can easily be subject to abuse because
of its subjective nature, as in the case at bar, and the loss
 must be founded on clearly established facts sufficient to
warrant the employees separation from work.

Position of trust and confidence

Philippine Pizza, Inc., vs.

Bungabong, G. R. No. 154315, May 9, 2005

Termination of an employee on the ground of loss of trust

and confidence is allowed so long as there is basis for the
loss of trust or that the employer has reasonable ground to
believe that the employee is responsible for the misconduct
that rendered him unworthy of the trust and confidence
demanded by his position.In termination cases, the settled
rule is that the burden of proving that the termination was
for a valid or authorized cause rests on the employer. But
just as the Labor Arbiter or the NLRC is not bound to
observe the strict technicalities enforced in courts of law, an
employer is not required to prove the existence of just cause
beyond reasonable doubt. Termination of an employee on
the ground of loss of trust and confidence is allowed so long
as there is basis for the loss of trust or that the employer
has reasonable ground to believe that the employee is
responsible for the misconduct that rendered him unworthy
of the trust and confidence demanded by his position. In this
regard, the employer must establish clearly and convincingly
by substantial evidence the facts and incidents upon which
the loss of trust and confidence in the employee may fairly
be made to rest.

University of the Immaculate

Conception v. Office of the Secretary of Labor and
 Employment, et. al., G.R. No. 178085-178086, September
14, 2015

Generally, employers are given wide latitude in terminating

the services of employees who perform functions which by
their nature require the employers full trust and confidence.
It is well-established 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. It has been held that when an employee
has been guilty of breach of trust or his employer has ample
reason to distrust him, a labor tribunal cannot deny the
employer the authority to dismiss him. To constitute a valid
ground for dismissal, it is sufficient that there be some
reasonable basis, supported by substantial evidence, for
such loss of confidence. Nonetheless, employers do not have
unbridled authority to dismiss employ-ees by simply invoking
Article 282(c). The loss of confidence must be genuine and
cannot be used as a subterfuge for causes which are illegal,
improper and unjust. Loss of confidence as a ground for
dismissal has never been intended to afford an occasion for
abuse by the employer of its prerogative, as it can easily be
subject to abuse because of its subjective nature.

Termination of employment pursuant to a union

security clause

Inguillo vs. First Philippine Scales Inc., G.R. No.

165407, June 5, 2009

The Labor Code of the Philippines has several provisions

under which an employee may be validly terminated,
namely: (1) just causes under Article 282; (2) authorized
causes under Article 283; (3) termination due to disease
under Article 284; and (4) termination by the employee or
resignation under Article 285. While the said provisions did
not mention as ground the enforcement of the Union
Security Clause in the CBA, the dismissal from employment
based on the same is recognized and accepted in our
jurisdiction.

Union security is a generic term, which is applied to and

comprehends closed shop, union shop, maintenance of
membership or any other form of agreement which imposes
upon employees the obligation to acquire or retain union
membership as a condition affecting employment. There is
union shop when all new regular employees are required to
join the union within a certain period as a condition for their
continued employment. There is maintenance of
membership shop when employees, who are union members
as of the effective date of the agreement, or who thereafter
become members, must maintain union membership as a
condition for continued employment until they are promoted
or transferred out of the bargaining unit or the agreement is
terminated. A closed-shop, on the other hand, may be
defined as an enterprise in which, by agreement between
the employer and his employees or their representatives, no
person may be employed in any or certain agreed
departments of the enterprise unless he or she is, becomes,
and, for the duration of the agreement, remains a member
in good standing of a union entirely comprised of or of which
the employees in interest are a part.

In terminating the employment of an employee by enforcing

the Union Security Clause, the employer needs only to
 determine and prove that: (1) the union security clause is
applicable; (2) the union is requesting for the enforcement
of the union security provision in the CBA; and (3) there is
sufficient evidence to support the unions decision to expel
the employee from the union or company.

Tanduay Distillery Labor Union vs. NLRC, G.R. No.

75037, April 30, 1987

We enforce basic principles essential to a strong and

dynamic labor movement. An established postulate in labor
relations firmly rooted in this jurisdiction is that the dismissal
of an employee pursuant to a demand of the majority union
in accordance with a union security agreement following the
loss of seniority rights is valid and privileged and does not
constitute an unfair labor practice.

Totality of infractions doctrine

Valiao vs. CA, G.R. No. 146621,

July 30, 2004

Even without the arrest incident, WNC had more than

enough basis for terminating petitioner from employment. It
bears stressing that petitioners absences and tardiness were
not isolated incidents but manifested a pattern of habituality.
In one case, we held that where the records clearly show
that the employee has not only been charged with the
offense of highgrading but also has been warned 21 times
for absences without official leave, these repeated acts of
misconduct and willful breach of trust by an employee justify
his dismissal and forfeiture of his right to security of tenure.
 The totality of infractions or the number of violations
committed during the period of employment shall be
considered in determining the penalty to be imposed upon
an erring employee. The offenses committed by him should
not be taken singly and separately but in their totality.
Fitness for continued employment cannot be
compartmentalized into tight little cubicles of aspects of
character, conduct, and ability separate and independent of
each other.

Alvarez vs. Golden Tri Bloc,

Inc., G.R. No. 202158, September 25, 2013

The totality of infractions or the number of violations

committed during the period of employment shall be
considered in determining the penalty to be imposed upon
an erring employee. The offenses committed by petitioner
should not be taken singly and separately. Fitness for
continued employment cannot be compartmentalized into
tight little cubicles of aspects of character, conduct and
ability separate and independent of each other. While it may
be true that petitioner was penalized for his previous
infractions, this does not and should not mean that his
employment record would be wiped clean of his infractions.
After all, the record of an employee is a relevant
consideration in determining the penalty that should be
meted out since an employees past misconduct and present
behavior must be taken together in determining the proper
imposable penalty. Despite the sanctions imposed upon
petitioner, he continued to commit misconduct and exhibit
undesirable behavior on board. Indeed, the employer cannot
be compelled to retain a misbehaving employee, or one who
is guilty of acts inimical to its interests. It has the right to
 dismiss such an employee if only as a measure of self-
protection.

Analogous causes

Yrasuegui vs. PAL, G.R. No.

168081, October 17, 2008

A reading of the weight standards of PAL would lead to no

other conclusion than that they constitute a continuing
qualification of an employee in order to keep the job. Tersely
put, an employee may be dismissed the moment he is
unable to comply with his ideal weight as prescribed by the
weight standards. The dismissal of the employee would thus
fall under Article 282(e) of the Labor Code. As explained by
the CA: x x x [T]he standards violated in this case were not
mere orders of the employer; they were the prescribed
weights that a cabin crew must maintain in order to qualify
for and keep his or her position in the company. In other
words, they were standards that establish continuing
qualifications for an employees position. In this sense, the
failure to maintain these standards does not fall under
Article 282(a) whose express terms require the element of
willfulness in order to be a ground for dismissal. The failure
to meet the employers qualifying standards is in fact a
ground that does not squarely fall under grounds (a) to (d)
and is therefore one that falls under Article 282(e)the
other causes analogous to the foregoing. By its nature,
these qualifying standards are norms that apply prior to
and after an employee is hired. They apply prior to
employment because these are the standards a job applicant
must initially meet in order to be hired. They apply after
hiring because an employee must continue to meet these
 standards while on the job in order to keep his job. Under
this perspective, a violation is not one of the faults for which
an employee can be dismissed pursuant to pars. (a) to (d) of
Article 282; the employee can be dismissed simply because
he no longer qualifies for his job irrespective of whether or
not the failure to qualify was willful or intentional. x x x

John Hancock Life Insurance

Corporation vs. Davis, G.R. No. 169549, September 3, 2009

In this case, petitioner dismissed respondent based on the

NBIs finding that the latter stole and used Yusecos credit
cards. But since the theft was not committed against
petitioner itself but against one of its employees,
respondents misconduct was not work-related and
therefore, she could not be dismissed for serious
misconduct. Nonetheless, Article 282(e) of the Labor Code
talks of other analogous causes or those which are
susceptible of comparison to another in general or in specific
detail. For an employee to be validly dismissed for a cause
analogous to those enumerated in Article 282, the cause
must involve a voluntary and/or willful act or omission of the
employee.

A cause analogous to serious misconduct is a voluntary

and/or willful act or omission attesting to an employees
moral depravity. Theft committed by an employee against a
person other than his employer, if proven by substantial
evidence, is a cause analogous to serious misconduct.

Installation of Labor-Saving Devices

 Magnolia Dairy Products
Corporation vs. NLRC, G.R. NO. 114952, January 29, 1996

The law authorizes an employer, like the herein petitioner, to

terminate the employment of any employee due to the
installation of labor saving devices. The installation of these
devices is a management prerogative, and the courts will not
interfere with its exercise in the absence of abuse of
discretion, arbitrariness, or maliciousness on the part of
management, as in this case. Nonetheless, this did not
excuse petitioner from complying with the required written
notice to the employee and to the Department of Labor and
Employment (DOLE) at least one month before the intended
date of termination. This procedure enables an employee to
contest the reality or good faith character of the asserted
ground for the termination of his services before the DOLE.

Redundancy

Asian Alcohol Corporation vs.

NLRC, G.R. No. 131108, March 25, 1999

The requirements for valid retrenchment which must be

proved by clear and convincing
evidence are: (1) that the retrenchment is reasonably
necessary and likely to prevent business losses which, if
already incurred, are not merely de minimis, but substantial,
serious, actual and real, or if only expected, are reasonably
imminent as perceived objectively and in good faith by the
employer; (2) that the employer served written notice both
to the employees and to the Department of Labor and
 Employment at least one month prior to the intended date of
retrenchment; (3) that the employer pays the retrenched
employees separation pay equivalent to one month pay or at
least 1/2 month pay for every year of service, whichever is
higher; (4) that the employer exercises its prerogative to
retrench employees in good faith for the advancement of its
interest and not to defeat or circumvent the employees right
to security of tenure; and (5) that the employer used fair
and reasonable criteria in ascertaining who would be
dismissed and who would be retained among the employees,
such as status (i.e., whether they are temporary, casual,
regular or managerial employees), efficiency, seniority,
physical fitness, age, and financial hardship for certain
workers.

Wiltshire File Co., Inc., vs.

NLRC, G.R. No. 82249 February 7, 1991

We do not believe that redundancy in an employers

personnel force necessarily or even ordinarily refers to
duplication of work. That no other person was holding the
same position that private respondent held prior to the
termination of his services, does not show that his position
had not become redundant. Indeed, in any well-organized
business enterprise, it would be surprising to find duplication
of work and two (2) or more people doing the work of one
person. We believe that redundancy, for purposes of our
Labor Code, exists where the services of an employee are in
excess of what is reasonably demanded by the actual
requirements of the enterprise. Succinctly put, a position is
redundant where it is superfluous, and superfluity of a
position or positions may be the outcome of a number of
factors, such as overhiring of workers, decreased volume
 of .business, or dropping of a particular produet line or
service activity previously manufactured or undertaken by
the enterprise. The employer has no legal obligation to keep
in its payroll more employees than are necessary for the
operation of its business.

Smart Communications, Inc.,

vs. Astorga, G.R. 148132 No. January 28, 2008

The nature of redundancy as an authorized cause for

dismissal is explained in the leading case of Wiltshire File
Co., Inc. v. National Labor Relations Commission, 193 SCRA
665 (1991), viz.: x x x redundancy in an employers
personnel force necessarily or even ordinarily refers to
duplication of work. That no other person was holding the
same position that private respondent held prior to
termination of his services does not show that his position
had not become redundant. Indeed, in any well organized
business enterprise, it would be surprising to find duplication
of work and two (2) or more people doing the work of one
person. We believe that redundancy, for purposes of the
Labor Code, exists where the services of an employee are in
excess of what is reasonably demanded by the actual
requirements of the enterprise. Succinctly put, a position is
redundant where it is superfluous, and superfluity of a
position or positions may be the outcome of a number of
factors, such as overhiring of workers, decreased volume of
business, or dropping of a particular product line or service
activity previously manufactured or undertaken by the
enterprise. The characterization of an employees services as
superfluous or no longer necessary and, therefore, properly
terminable, is an exercise of business judgment on the part
of the employer. The wisdom and soundness of such
 characterization or decision is not subject to discretionary
review provided, of course, that a violation of law or
arbitrary or malicious action is not shown.

Retrenchment

Flight Attendants and Stewards Association of the

Philippines (FASAP) vs. PAL, G.R. No. 178083, July 22, 2008

The burden clearly falls upon the employer to prove

economic or business losses with sufficient supporting
evidence. Its failure to prove these reverses or losses
necessarily means that the employees dismissal was not
justified. Any claim of actual or potential business losses
must satisfy certain established standards, all of which must
concur, before any reduction of personnel becomes legal.
These are: (1) That retrenchment is reasonably necessary
and likely to prevent business losses which, if already
incurred, are not merely de minimis, but substantial, serious,
actual and real, or if only expected, are reasonably imminent
as perceived objectively and in good faith by the employer;
(2) That the employer served written notice both to the
employees and to the Department of Labor and Employment
at least one month prior to the intended date of
retrenchment; (3) That the employer pays the retrenched
employees separation pay equivalent to one (1) month pay
or at least one-half () month pay for every year of service,
whichever is higher; (4) That the employer exercises its
prerogative to retrench employees in good faith for the
advancement of its interest and not to defeat or circumvent
the employees right to security of tenure; and, (5) That the
employer used fair and reasonable criteria in ascertaining
 who would be dismissed and who would be retained among
the employees, such as status, efficiency, seniority, physical
fitness, age, and financial hardship for certain workers.

Meaning of retrenchment to prevent losses

Revidad vs. NLRC, G.R. No. 111105, June 27, 1995

Retrenchment is one of the economic grounds to dismiss

employees, which is resorted to by an employer primarily to
avoid or minimize business losses. The law recognizes this
under Article 283 of the Labor Code. In its ordinary
connotation, the phrase to prevent losses means that
retrenchment or termination of the services of some
employees is authorized to be undertaken by the employer
sometime before the anticipated losses are actually
sustained or realized. It is not, in other words, the intention
of the lawmaker to compel the employer to stay his hand
and keep all his employees until after losses shall have in
fact materialized. If such an intent were expressly written
into the law, that law may well be vulnerable to
constitutional attack as unduly taking property from one
man to be given to another.

At the other end of the spectrum, it seems equally clear that

not every asserted possibility of loss is sufficient legal
warrant for the reduction of personnel. In the nature of
things, the possibility of incurring losses is constantly
present, in greater or lesser degree, in the carrying on of
business operations, since some, indeed many, of the
factors which impact upon the profitability or viability of such
operations may be substantially outside the control of the
 employer.

Best evidence of losses

Saballa vs. NLRC, G.R. Nos. 102472-84, August 22,

1996

This Court has previously held that financial statements

audited by independent external auditors constitute the
normal method of proof of the profit and loss performance
of a company. And since private respondent insists that its
critical financial condition was the central and pivotal reason
for its retrenchment and forced leave programs, we
therefore fail to see why it should neglect or refuse to
submit such audited financial statements. Apart from that,
we noted that the said unaudited statements were filled with
erasures; some entries were even handwritten, and different
typewriters were used. There is therefore serious ground to
doubt the correctness and accuracy of said statements.
Additionally, these statements require further explanations
before the accounting procedures of private respondent can
be understood. Thus, the Court is wary of according them
any probative value, especially since respondent Commission
seems to have treated them in a similar fashion by not
discussing them in its Decision.

Redundancy vs. Retrenchment

Andrada vs. NLRC, G.R. No. 173231, December 28,

2007
Retrenchment and redundancy are two different concepts;
they are not synonymous and therefore should not be used
interchangeably. Redundancy exists where the services of an
employee are in excess of what is reasonably demanded by
the actual requirements of the enterprise. A position is
redundant where it is superfluous, and superfluity of a
position or positions may be the outcome of a number of
factors, such as over hiring of workers, decreased volume of
business, or dropping of a particular product line or service
activity previously manufactured or undertaken by the
enterprise. Retrenchment, on the other hand, is used
interchangeably with the term lay-off. It is the termination
of employment initiated by the employer through no fault of
the employees and without prejudice to the latter, resorted
to by management during periods of business recession,
industrial depression, or seasonal fluctuations, or during lulls
occasioned by lack of orders, shortage of materials,
conversion of the plant for a new production program or the
introduction of new methods or more efficient machinery, or
of automation. Simply put, it is an act of the employer of
dismissing employees because of losses in the operation of a
business, lack of work, and considerable reduction on the
volume of his business, a right consistently recognized and
affirmed by this Court.

Redundancy exists when the number of employees is in

excess of what is reasonably necessary to operate the
business. The declaration of redundant positions is a
management prerogative. The determination that the
employees services are no longer necessary or sustainable
and therefore properly terminable is an exercise of business
judgment by the employer. The wisdom or soundness of this
 judgment is not subject to the discretionary review of the
Labor Arbiter and NLRC. It is however not enough for a
company to merely declare that positions have become
redundant. It must produce adequate proof of such
redundancy to justify the dismissal of the affected
employees.

Closure or Cessation of Business Operations

Eastridge Golf Club, Inc., vs. Eastridge Golf Club, Inc.,

Labor Union-Super, G.R. No. 166760, August 22, 2008

Closure or cessation of business is the complete or partial

cessation of the operations and/or shut-down of the
establishment of the employer. It is carried out to either
stave off the financial ruin or promote the business interest
of the employer. Unlike retrenchment, closure or cessation
of business, as an authorized cause of termination of
employment, need not depend for validity on evidence of
actual or imminent reversal of the employers fortune. Article
283 authorizes termination of employment due to business
closure, regardless of the underlying reasons and
motivations therefor, be it financial losses or not.

The decision to close business is a management prerogative

exclusive to the employer, the exercise of which no court or
tribunal can meddle with, except only when the employer
fails to prove compliance with the requirements of Art. 283,
to wit: a) that the closure/cessation of business is bona fide,
i.e., its purpose is to advance the interest of the employer
and not to defeat or circumvent the rights of employees
under the law or a valid agreement; b) that written notice
 was served on the employees and the DOLE at least one
month before the intended date of closure or cessation of
business; and c) in case of Eastridge Golf Club, Inc. vs.
Eastridge Golf Club, Inc., Labor Union-Super
closure/cessation of business not due to financial losses, that
the employees affected have been given separation pay
equivalent to month pay for every year of service or one
month pay, whichever is higher.

Industrial Timber Corporation vs. NLRC, G.R. No.

107302 and 107306, June 10, 1997
v) Disease or illness

The foregoing notwithstanding, petitioner corporation

complied with the requirements mandated by law to
effectuate valid termination of employment on account of
closure. Under the law, for an employer to validly terminate
the service of his employees under the aforesaid ground, he
has to comply with two (2) requirements, namely: (a)
serving a written notice on the workers and the DOLE at
least one (1) month before the effective date of the closure
and (b) payment of separation pay equivalent to one (1)
month pay or at least one-half (1/2) month pay for every
year of service, whichever is higher, with a fraction of at
least six (6) months to be considered one (1) whole year.

Disease or illness

Crayons Processing, Inc., vs. Pula, G.R. No. 167727,

July 30, 2007

A dismissal on the ground of disease to be considered valid,

two requisites must concur: (1) the employee must be
 suffering from a disease which cannot be cured within six
months and his continued employment is prohibited by law
or prejudicial to his health or to the health of his co-
employees; and (2) a certification to that effect must be
issued by a competent public health authority.

The burden falls upon the employer to establish these

requisites, and in the absence of such certification, the
dismissal must necessarily be declared illegal. Without the
required certification, the characterization or even diagnosis
of the disease would primarily be shaped according to the
interests of the parties rather than the studied analysis of
the appropriate medical professionals. The requirement of a
medical certificate under Article 284 cannot be dispensed
with; otherwise, it would sanction the unilateral and arbitrary
determination by the employer of the gravity or extent of
the employee's illness and thus defeat the public policy in
the protection of labor.

Competent Public Health Authority

Cebu Royal Plant vs. Minister of Labor, G.R. No. L-

58639, August 12, 1987

The applicable rule on the ground for dismissal invoked

against him is Section 8, Rule I, Book VI, of the Rules and
Regulations Implementing the Labor Code which states that
the employer shall not terminate his employment unless
there is a certification by a competent public health authority
that the disease is of such nature or at such a stage that it
cannot be cured within a period of six (6) months even with
proper medical treatment.
 Twin-Notice Rule

Ruffy vs. NLRC, G.R. No. 84193, February 15, 1990

The procedure prior to dismissal of an employee needs not

to be observed to the letter, but at least, it must be done in
the natural sequence of notice, hearing, and judgment.
Ample opportunity is meant every kind of assistance that
the management must accord to the employee to enable
him to prepare adequately his defense.

King of Kings Transport, Inc., vs. Mamac, G.R. No.

166208, June 29, 2007

Verbal appraisal of the charges against the employee will not

suffice. In terminating the services of an employee, the
following must be considered: a. First written notice
indicating the charges or grounds for termination against the
employee and a directive that the employee is given the
opportunity to submit their written explanation within a
reasonable period; b. a Hearing or Conference to give the
employee the opportunity to be heard, present evidences
and rebut evidences presented against him; and c. Written
notice of termination indicating that all circumstances related
to the charge against the employee were considered and the
grounds for his dismissal.

IBM Philippines vs. NLRC, G.R. No. 117221, April 13,

1999

The liberality of procedure in administrative actions is

subject to limitations imposed by basic requirements of due
 process; this procedural rule should not be construed as a
license to disregard certain fundamental evidenciary rules.
The evidence presented must be at least have a modicum of
admissibility for it to be given some probative value. The
computer print-outs, which constitute only evidence of
petitioners, afford no assurance of their authenticity since
they are unsigned. The liberal view in the conduct of
proceedings before administrative agencies, have
nonetheless consistently required some proof of authenticity
or reliability as condition for the admission of documents.
the procedural technicality and concerns are more
paramount principles and requirements of due process,
which may not be sacrificed to speed or expediency, Article
22 of the Labor Code which states that due process must
never be subordinated to expediency or dispatch.

Administrative Hearing

Asian Terminals, Inc., vs. Marbella,

G.R. No. 149074, August 10, 2006

The requisites of a valid dismissal for just causes are: (a) the
dismissal must be for one of the causes stated in Article 282
of the Labor Code; and (b) the employee must have been
accorded due process, basic of which is the opportunity to
be heard and defend himself.

The law provides that, no employee may be validly

dismissed unless the employer has complied with the two
notice requirements: (1) a written notice containing a
statement of the cause for termination to afford the
employee an opportunity to be heard and defend himself
 with the assistance of his representative, if he so desires;
and (2) and a written notice stating clearly the reason of the
termination. The procedure is mandatory and failure to
comply with these procedural requirements for terminating
employment taints the dismissal with illegality.

Shoppers Gain Supermart vs.

NLRC, G.R. No. 110731, July 26, 1996

The Supreme Court held that what was controlling in the

issue is the provisions of Artcile 106 of the Labor Code and
not that of Article 208. The former clearly defines what
constitute labor-only contractor as differentiated from a
direct contractor, including the legal effects of each, while
the latter is merely for the purpose of determining whether
or not an employee is considered regular. Based on the
provision of Article 106, the Supreme Court ruled that the
petitioner was indeed the direct employer of private
respondents and was therefore 0bliged to pay them
separation pay. The Supreme Court reasoned that since it is
undeniable that the private respondents' work as
merchandisers, cashiers, baggers, check-out personnel,
sales ladies, warehousemen and so forth were directly
related, necessary and vital to the day-to-day operations of
the supermarket and that their jobs involved normal and
regular functions in the ordinary business of the petitioner
corporation, the provision of Article 106 clearly applied thus
making the manpower agencies merely agents of petitioner
corporation.

Caingat vs. NLRC, G.R. No.

154308, March 10, 2005
 The loss of trust and confidence as a just cause for
termination of employment is premised on the fact that an
employee concerned holds a position where greater trust is
placed by management and from whom greater fidelity to
duty is correspondingly expected. This includes managerial
personnel entrusted with confidence on delicate matters,
such as the custody, handling, or care and protection of the
employers property. The betrayal of this trust is the essence
of the offense for which an employee is penalized.
Managements loss of trust and confidence on petitioner was
well justified. Private respondents had every right to dismiss
petitioner.

Wenphil Corporation vs. NLRC,

G.R. No. 80587, February 8, 1989

The basic requirement of due proves is that which hears

before it condemns, proceeds upon inquiry and renders
judgment only after trial. The dismissal of an employee must
be for a just cause and after due process. Petitioner
committed an infraction of the second requirement thus it
must be imposed a sanction for its failure to give a formal
notice and conduct an investigation as required by law
before dismissal from employment.

Maneja vs. NLRC, G.R. No. 124013,

June 5, 1998

Termination cases fall under the original and exclusive

jurisdiction of the Labor Arbiter (LC 217), but it should be
read in conjunction with LC 261 which grants to voluntary
arbitrators original and exclusive jurisdiction to hear and
decide all unresolved grievances arising from the
 interpretation of CBA or of enforcement of personnel
policies.

Eastern Overseas Employment

Center, Inc. vs. Nagkakaisang Empleyado ng Wellcome-DFA,
G.R. No. 149349, March 11, 2005

To stress, if the dismissal is based on a just cause under

Article 282 of the Labor Code, the employer must give the
employee (1) two written notices and (2) a hearing (or at
least, an opportunity to be heard). The first notice is
intended to inform the employee of the employers intent to
dismiss and the particular acts or omissions for which the
dismissal is sought. The second notice is intended to inform
the employee of the employers decision to dismiss. This
decision, however, must come only after the employee has
been given a reasonable period, from receipt of the first
notice, within which to answer the charge; and ample
opportunity to be heard with the assistance of counsel, if the
employee so desires. The twin requirements of (a) two
notices and (b) hearing are necessary to protect the
employees security of tenure, which is enshrined in the
Constitution, the Labor Code and related laws.

Development of Doctrines

Wenphil Corporation vs. NLRC, G.R. No. 80587

February 8, 1989, En Banc

The basic requirement of due proves is that which

hears before it condemns, proceeds upon inquiry and
renders judgment only after trial. The dismissal of an
 employee must be for a just cause and after due
process. Petitioner committed an infraction of the
second requirement thus it must be imposed a sanction
for its failure to give a formal notice and conduct an
investigation as required by law before dismissing
Mallare from employment. Petitioner must indemnify
the dismissed employee which depends on the facts of
each case and the gravity of the omission committed
by the employer.
Under this doctrine, if the services of the employee
was terminated due to a just or authorized cause but
the affected employees right to due process has been
violated, the dismissal is legal but the employee is
entitled to damages by way of indemnification for the
violation of the right.

Serrano vs. NLRC, G.R. No. 117040, May 4, 2000, En

Banc

The purpose of the notice and hearing under the Due

process clause is to provide an opportunity for the employee
to be heard before the power of the organized society is
brought upon the individual. Under Art. 283, however, the
purpose is to give him time to prepare for the eventual loss
of his job and for DOLE to determine whether economic
causes exist to justify termination. It is not to give
opportunity to be heardthere is no charge against the
employee under Art. 283. The employer cannot be expected
to be an impartial judge of his own cause.

It modified Wenphil; stiffened the penalty to "full

backwages"; The employee, dismissed for a valid reason,
 remains dismissed, but the employer who disregarded
proper procedure, must pay full backwages in addition to the
separation pay, if applicable, and indemnity.

Agabon vs. NLRC, G.R. No. 158693, November 17,

2004, En Banc

Where the dismissal is for a just cause, the lack of statutory

due process should not nullify the dismissal but the
employer should indemnify the employee for the violation of
his statutory rights. The indemnity should be stiffer to
discourage the abhorrent practice of dismiss now, pay later
which we sought to deter in Serrano ruling. The violation of
employees rights warrants the payment of nominal
damages.

This Abandoned the Serrano doctrine and REINSTATED THE

WENPHIL DOCTRINE. The sanctions, however must be
stiffer than that imposed in Wenphil. The termination is
valid, the employee remains dismissed, but the employer
must pay an indemnity (penalty for not observing due
process) heavier than that imposed in Wenphil but lighter
than full backwages.

Reinstatement to previous position or substantially

equivalent position

Asian Terminals, Inc., vs. Villanueva, G.R. No. 143219,

November 28, 2006

Reinstatement means restoration to a state or condition

from which one had been removed or separated. The person
 reinstated assumes the position he had occupied prior to his
dismissal. Reinstatement presupposes that the previous
position from which one had been removed still exists, or
that there is an unfilled position which is substantially
equivalent or of similar nature as the one previously
occupied by the employee. Reinstatement means restoration
to the former position occupied prior to dismissal or to
substantially equivalent position. Reinstatement does not
mean promotion. Promotion is based primarily on an
employees performance during a certain period. Just
because their contemporaries are already occupying higher
positions does not automatically entitle respondents to
similar positions.

Separation pay as financial assistance

PLDT vs. NLRC, G.R. No. L-

80609, August 23, 1988, En Banc

Separation pay shall only be allowed as a measure of social

justice when the employee is validly dismissed for causes
other than serious misconduct and not involving moral
turpitude. There is no doubt it is compassionate to give
separation pay when the cause is not iniquitous as when a
salesman is dismissed for his inability to fill his quota. His
company cannot be compelled to maintain him at the
expense of the efficiency of their operations but the
awarding of financial assistance would be sustainable under
the policy of social justice. However, the same salesman
surely does not deserve such generosity if his offense is
misappropriation of the receipts of his sales. Such conduct is
not simply inept but rather depraved and immoral, thus
 making him undeserving of such assistance.

Separation pay in lieu of reinstatement Strained

relation rule

Golden Ace Builders vs. Talde, G.R.

No. 187200, May 5, 2010

When reinstatement is no longer feasible because of

strained relations between the employee and the employer,
separation pay equivalent to one (1) month salary for every
year of service should be awarded as an alternative. The
payment of separation pay is in addition to payment of
backwages. In effect, an illegally dismissed employee is
entitled to either reinstatement, if viable, or separation pay if
reinstatement is no longer viable, and backwages.

Under the doctrine of strained relations, the payment of

separation pay is considered an acceptable alternative to
reinstatement when the latter option is no longer desirable
or viable. On one hand, such payment liberates the
employee from what could be a highly oppressive work
environment. On the other hand, it releases the employer
from the grossly unpalatable obligation of maintaining in its
employ a worker it could no longer trust.

Leopard Security and Investigation

Agency vs. Quitoy, G.R. No. 186344, February 20, 2013

Security guards may be temporarily sidelined by their

security agency as their assignments primarily depend on
 the contracts entered into by the latter with third parties.
Temporary off-detail or floating status is 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. For as
long as such temporary inactivity does not continue for a
period exceeding six months, it has been ruled that placing
an employee on temporary off-detail or floating status is
not equivalent to dismissal.

Backwages and Separation Pay, Distinguished

Golden Ace Builders vs. Talde, G.R.
No. 187200, May 5, 2010

An illegally dismissed employee is entitled to two reliefs:

backwages and reinstatement. An employee is entitled to
backwages and separation pay if his reinstatement had been
rendered impossible due to strained relations. His
backwages must be computed from the time he was unjustly
dismissed until his actual reinstatement when his
reinstatement was rendered impossible without fault on his
part.

Constructive dismissal

Uniwide Sales Warehouse Club vs. NLRC, G.R. No. 154503,

February 29, 2008

Case law defines constructive dismissal as a cessation of

work because continued employment is rendered impossible,
unreasonable or unlikely; when there is a demotion in rank
 or diminution in pay or both; or when a clear discrimination,
insensibility, or disdain by an employer becomes unbearable
to the employee. The test of constructive dismissal is
whether a reasonable person in the employees position
would have felt compelled to give up his position under the
circumstances.It is an act amounting to dismissal but made
to appear as if it were not. In fact, the employee who is
constructively dismissed may be allowed to keep on coming
to work. Constructive dismissal is therefore a dismissal in
disguise. The law recognizes and resolves this situation in
favor of employees in order to protect their rights and
interests from the coercive acts of the employer.

Globe Telecom vs. Florendo-Flores, G.R. No. 150092,

September 27, 2002

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 and a diminution in pay." In constructive
dismissal, the employer has the burden of proving that the
transfer and demotion of an employee are for just and valid
grounds such as genuine business necessity. The transfer
must not involve a demotion in rank or a diminution of
salary and other benefits. If the employer cannot overcome
this burden of proof, the employee's demotion shall be
tantamount to unlawful constructive dismissal. The award of
back wages in the instant case is justified upon the finding
of illegal dismissal.

Termination of employment by employee

(Resignation)
 Hechanova Bugay Vilchez Lawyers, et. al., v. Atty. Leny
Matorre, G.R. No. 198261, October 16, 2013

Employee has the burden of proving that resignation was

not voluntary. Petitioner cannot take refuge in the argument
that it is the employer who bears the burden of proof that
the resignation is voluntary and not the product of coercion
or intimidation. Having submitted a resignation letter, it is
then incumbent upon her to prove that the resignation was
not voluntary but was actually a case of constructive
dismissal with clear, positive, and convincing evidence.
30-day notice requirement from resignation is for the benefit
of the employer. The 30-day notice requirement for an
employees resignation is actually for the benefit of the
employer who has the discretion to waive such period. Its
purpose is to afford the employer enough time to hire
another employee if needed and to see to it that there is
proper turn-over of the tasks which the resigning employee
may be handling. The rule requiring an employee to stay or
complete the 30-day period prior to the effectivity of his
resignation becomes discretionary on the part of
management as an employee who intends to resign maybe
allowed a shorter period before his resignation becomes
effective.
 COMPILATION OF CASE
DOCTRINES IN LABOR RELATIONS

SUBMITTED TO:
ATTY. AGNES ALEXIS LUCERO-DE
GRANO

SUBMITTED BY:

NIEGOS, BIENVENIDO Jr.

LIM, ANTON KRISTOFFER
PAGOROGON, JESUS
DUMAYAS, EMMANUEL
DEL ROSARIO, WILLIAM Jr.
MENESES, ROSENDO IV