Digital Telecom Phils. Inc/Gokongwei Jr.
v Neilson Ayapana ● Ayapana submitted a written response, contending that:
Exception: separation pay may be granted based on equity, as a
measure of social justice | January 10, 2018 | Martires, J.
Nature of Case: Petition for review on certiorari
Digest Maker: Buen
SUMMARY: Respondent offered telecom lines which were non-
existent in the client’s area, for which he received payment and
issued receipts. Due to such acts and failure to remit, he was
dismissed for breach of trust and confidence. He filed complaint for
illegal dismissal. LA dismissed. NLRC reversed, merely finding him
guilty of imprudence and not bad faith and malice. CA affirmed. SC
affirmed and awarded separation pay.
DOCTRINE: The willful breach by the employee of the trust reposed
in him by his employer or the latter's duly authorized representative
is a just cause for dismissal. Even when there is a valid dismissal,
separation pay may be granted as a measure of social justice.
FACTS:
● Ayapana was hired by DIGITEL hired as Key Accounts
Manager for its telecom products and services in Quezon,
Marinduque, and Laguna, tasked to offer and sell their foreign
exchange (FEX) line to prospective customers.
● He successfully offered two FEX lines for Atimonan, Quezon to
Estela Lim, owner of Star Lala Group of Companies, receiving
P7000 for the two lines, and issuing two official receipts.
However, he did not remit the amount on the same date.
● Respondent learned that there was no available FEX line in
Atimonan due to technical constraints. He retrieved from Lim
the receipts, replacing them with an acknowledgement receipt.
● Lim’s secretary then requested for refund. It was found that
there was no existing application under the name of Star Lala.
● After finding that respondent was the sales person handling
Lim’s transaction, company informed him of the request for
refund, which he made five days after notice.
● DIGITEL issued Notice to Explain, asking Ayapana to explain:
○ why he offered an inexistent FEX line
○ why he withdrew the receipts and replaced them with
an acknowledgement receipt
○ why he did not immediately remit the amount
○ why he retained the amount for 84 days.
○ he was unaware of the unavailability of Atimonan line
○ he retrieved the official receipts to avoid explaining the
late remittance to the treasury department because, at
the time, Lim was still undecided whether to subscribe
in Lucena until Atimonan becomes available
○ he issued the acknowledgment receipt as proof that the
subject amount is in his possession
○ that he made several attempts to obtain secretary’s
advice as to the return of subject amount, to no avail
○ that after being informed of request for refund, he
went to Star Lala's office, which was closed, and
thereafter tried to obtain secretary’s address in order to
return the money, to no avail
● According to him, he handed the amount to customer
representative after she informed him that Lim’s secretary
would retrieve the money from her.
● DIGITEL thereafter sent him a Notice of Offense, and
subsequent Notice of Dismissal finding him guilty of "breach
by the employee of the trust and confidence reposed in him by
management or by a company representative" under their
disciplinary rules, which merited dismissal for the first offense.
● Respondent filed complaint for illegal dismissal.
● LA dismissed, finding the dismissal valid.
● NLRC reversed, holding that he was merely guilty of
imprudence and not of bad faith and malice. It denied MR.
● CA affirmed NLRC ruling. It held that the dismissal was not
valid because neglect of duty was not habitual. CA denied MR.
ISSUE/HELD: WON CA correctly held that the dismissal was invalid
and that he is entitled to full back wages and separation pay. —
1. The willful breach of trust is a just cause for dismissal. In the
case at bar, both requisites were present:
a. the employee concerned must be holding a position of
trust and confidence
b. there must be a willful act that would justify the loss of
trust and confidence.
2. It is uncontroverted that respondent took part in a series of
irregularities relative to his transaction with Lim.
 a. Offered an inexistent line and received money. It was management prerogative, but this Court considers in
integral to his functions to ensure that lines he offered his favor the above circumstances in granting him
to potential subscribers were valid and subsisting. separation pay in the amount of one (1) month pay
b. Failed to immediately remit the proceeds. for every year of service.
c. Did not immediatefly effect a refund nor inform
management of his decision to retain the money, but DISPOSITIVE: WHEREFORE, premises considered, the petition is
instead replaced the receipts. GRANTED. The assailed 7 October 2010 Decision and 4 February 2011
3. Court found respondent’s contentions misplaced as his acts Resolution of the Court of Appeals in CA-G.R. SP No. 112160, are
subsequent to being aware of the Atimonan line's REVERSED and SET ASIDE. The Decision of the Labor Arbiter
unavailability manifests willfulness and deliberateness. dismissing respondent Neilson M. Ayapana's complaint for illegal
4. [TOPIC] Even with a finding that respondent was validly dismissal and other monetary claims is REINSTATED with
dismissed, separation pay may be granted as a measure of MODIFICATION that respondent should be paid separation pay
social justice. equivalent to one month of his latest salary for every year of service.
a. Generally, an employee dismissed for any of the just
causes under Article 297 is not entitled to separation
pay. By way of exception, the Court has allowed the
grant of separation pay based on equity and as a
measure of social justice, as long as the dismissal was
for causes other than serious conduct or those
manifesting moral depravity.
b. Toyota v. NLRC: where the Court held that "in addition
to serious misconduct, in dismissals based on other
grounds under Art. 282 like willful disobedience, gross
and habitual neglect of duty, fraud or willful breach of
trust, and commission of a crime against the employer
or his family, separation pay should not be conceded to
the dismissed employee." However, the Court also
recognizes that some cases merit a relaxation of this
rule, taking into consideration their peculiar
circumstances.
c. Lack of moral depravity is shown in his admission that
he was primarily actuated by zealousness in
acquiring and retaining subscribers rather than any
intent to misappropriate company funds; offering an
alternative FEX line to Lim was part of his strategy to
ensure her subscription. Such lack of moral depravity
is also shown in his performances, commendations,
services, increases, etc.
d. To be sure, his zealousness was manifested through
acts that showed an inordinate lapse of judgment
warranting his dismissal in accordance with