VICENTE ANG, v. CEFERINO SAN JOAQUIN, JR.

, AND DIOSDADO FERNANDEZ,

Petitioner: Ang
Respondents: San Joaquin and Fernandez
G.R. No. 185549
August 07, 2013

FACTS: The employers act of tearing to pieces the employees time card may be considered an outright
not only symbolic termination of the parties employment relationship.

Petitioner Vicente Ang is the proprietor of Virose Furniture and Glass Supply (Virose) in Tayug,
Pangasinan, a wholesaler/retailer of glass supplies, jalousies, aluminum windows, table glass, and
assorted furniture. Respondents Ceferino San Joaquin, Jr. (San Joaquin) and Diosdado Fernandez
(Fernandez) were regular employees of Virose: San Joaquin was hired in 1974 as helper, while Fernandez
was employed in 1982 as driver. Each received a daily salary of P166.00.

Through the years, San Joaquin who is Angs first cousin, their mothers being sisters became
apahinante or delivery helper, and later on an all-around worker of Virose.

On August 24, 1999, respondents attended the court hearing relative to the 41 criminal cases filed by
former Virose employee Daniel Abrera (Abrera) against Ang for the latters non-remittance of Social
Security System (SSS) contributions.9 During that hearing, respondents testified against Ang; it was the
second time for San Joaquin to testify, while it was Fernandezs first. Previously, respondents joined
Abrera in questioning Angs procedure in remitting their SSS contributions. After the said hearing Ang
began to treat respondents with hostility and antagonism.

One day, a heated argument between San Joaquin and Ang's wife Rosa took place, in view of the former's
refusal to obey her her instruction to transfer the monobloc chairs in her restaurant. Upon reporting for
work two days later, he found out that his DTR was torn into pieces by Ang. He learned that the DTR of
Fernandez also suffered the same fate after they testified in Court.

Fernandez was suspended for a week for insubordination but the act of insubordination was not specified
by Ang in his memorandum to the latter.

Respondents filed complaints for illegal constructive dismissal. Labor Arbiter held that respondents were
unable to show how Ang discriminated against them. San Joaquin was guilty of insubordination in not
carrying out a reasonable order of his employer. As for Fernandez, the Labor Arbiter held that the loss of
his time card is not sufficient reason to suppose that his employment had been terminated.

NLRC AFFIRMED LA. Court of Appeals REVERSED the ruling of NLRC.

ISSUE: WON tearing of DTRs of the employees by the employer constitutes constructive dismissal.

HELD: 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. It is a dismissal in disguise or an act amounting to dismissal but
made to appear as if it were not.Constructive dismissal may likewise exist if an act of clear
discrimination, insensibility, or disdain by an employer becomes so unbearable on the part of the
employee that it could foreclose any choice by him except to forego his continued employment.
Constructive dismissal exists when the employee involuntarily resigns due to the harsh, hostile,
and unfavorable conditions set by the employer. 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.
"The CA is correct in its pronouncement that respondents were constructively dismissed from work.
Moreover, by destroying respondents time cards, Ang discontinued and severed his relationship with
respondents. The purpose of a time record is to show an employees attendance in office for work and to
be paid accordingly, taking into account the policy of no work, no pay. A daily time record is primarily
intended to prevent damage or loss to the employer, which could result in instances where it pays an
employee for no work done; it is a mandatory requirement for inclusion in the payroll, and in the absence
of an employment agreement,it constitutes evidence of employment. Thus, when Ang tore the
respondents time cards to pieces, he virtually removed them from Viroses payroll and erased all vestiges
of respondents employment; respondents were effectively dismissed from work. The act may be
considered an outright not only symbolic termination of the parties employment relationship; the
last straw that finally broke the camels back, as respondents put it in their Position Paper."

SAN MIGUEL BREWERY SALES FORCE UNION (PTGWO) vs. HON. BLAS F. OPLE, as
Minister of Labor and SAN MIGUEL CORPORATION
Petitioner: San Miguel
Respondent: Ople
G.R. No. L-53515
February 8, 1989

FACTS: On April 17, 1978, a collective bargaining agreement (effective on May 1, 1978 until January
31, 1981) was entered into by petitioner San Miguel Corporation Sales Force Union (PTGWO), and the
private respondent, San Miguel Corporation, Section 1, of Article IV of which provided as follows:

Art. IV, Section 1. Employees within the appropriate bargaining unit shall be entitled to a basic monthly
compensation plus commission based on their respective sales.

In 1979, SMC implemented its Complementary Distribution System (CDS) whereby wholesalers can
directly get beer products from any SMC offices. The SMB Union assailed this program because it
violates the CBA particularly the established scheme whereby route salesmen have been given specific
territories to sell beer products. The CDS scheme would then lower the take home pay of the route
salesmen. SMB Union then sued SMC for unfair labor practices.

ISSUE: WON the CDS is a violation of the CBA.

HELD: No. The SC ruled that the CDS is an exercise of management prerogatives whereby the
management can implement schemes to optimize their profit. Further, the CDS provides for a
compensation clause as well for salesmen. San Miguel Corporations offer to compensate the members of
its sales force who will be adversely affected by the implementation of the CDS by paying them a so-
called back adjustment commission to make up for the commissions they might lose as a result of the
CDS proves the companys good faith and lack of intention to bust their union.

So long as a company's management prerogatives are exercised in good faith for the advancement
of the employer's interest and not for the purpose of defeating or circumventing the rights of the
employees under special laws or under valid agreements, this Court will uphold them (LVN Pictures
Workers vs. LVN, 35 SCRA 147; Phil. American Embroideries vs. Embroidery and Garment Workers, 26
SCRA 634; Phil. Refining Co. vs. Garcia, 18 SCRA 110). San Miguel Corporation's offer to compensate
the members of its sales force who will be adversely affected by the implementation of the CDS by
paying them a so-called "back adjustment commission" to make up for the commissions they might lose
as a result of the CDS proves the company's good faith and lack of intention to bust their union.

KING OF KINGS ET AL vs. MAMAC

Petitioner: KING OF KINGS TRANSPORT INC., CLAIRE DELA FUENTE and MELISSA LIM
Respondent: SANTIAGO O. MAMAC
G.R. No. 166208
June 29, 2007

FACTS: Petitioner KKTI is a corporation engaged in public transportation and managed by Claire Dela
Fuente and Melissa Lim. Respondent was a conductor for Don Mariano Transit Corporation (DMTC). He
was one of the few people who established Damayan ng mga Manggagawa, Tsuper at Conductor-
Transport Workers Union. Pending the unions certification election, respondent was transferred to KKTI.
The KKTI employees later organized the Kaisahan ng mga Kawani sa King of Kings (KKKK) which was
registered with DOLE. Respondent was elected KKKK president.

Upon audit of the October 28, 2001 Conductors Report of respondent, KKTI noted an irregularity. It
discovered that respondent declared several sold tickets as returned tickets causing KKTI to lose an
income of eight hundred and ninety pesos. While no irregularity report was prepared on the October 28,
2001 incident, KKTI nevertheless asked respondent to explain the discrepancy. In his letter, respondent
said that the erroneous declaration in his October 28, 2001 Trip Report was unintentional. He explained
that during that days trip, the windshield of the bus assigned to them was smashed; and they had to cut
short the trip in order to immediately report the matter to the police. As a result of the incident, he got
confused in making the trip report.

On November 26, 2001, respondent received a letter terminating his employment effective November 29,
2001. The dismissal letter alleged that the October 28, 2001 irregularity was an act of fraud against the
company. KKTI also cited as basis for respondents dismissal the other offenses he allegedly committed
since 1999.

After that, he filed an action for illegal dismissal, among other claims. He denied committing any
infraction and alleged that his dismissal was intended to bust union activities. Moreover, he claimed that
his dismissal was effected without due process.

KKTI averred that it had observed due process in dismissing respondent and maintained that respondent
was not entitled to his money claims such as service incentive leave and 13th-month pay because he was
paid on commission or percentage basis.

LABOR ARBITER: he was validly dismissed

NLRC: Affirmed. CA held that there was just cause for respondents dismissal. It ruled that respondents
act in declaring sold tickets as returned tickets x x x constituted fraud or acts of dishonesty justifying his
dismissal.

ISSUE: WON respondent was given due process (procedural)

HELD: NO. There was failure to observe the requirements of due process

Due process under the Labor Code involves two aspects: first, substantivethe valid and authorized
causes of termination of employment under the Labor Code; and second, proceduralthe manner of
dismissal.

Section 2(d) of Rule I of Book VI of the Omnibus Rules Implementing the Labor Code provides:
SEC. 2. Standards of due process; requirements of notice.In all cases of termination of
employment, the following standards of due process shall be substantially observed:

For termination of employment based on just causes as defined in Article 282 of the Code:

(a) A written notice served on the employee specifying the ground or grounds for termination, and
giving said employee reasonable opportunity within which to explain his side.

(b) A hearing or conference during which the employee concerned, with the assistance of counsel if
he so desires is given opportunity to respond to the charge, present his evidence, or rebut the
evidence presented against him.

(c) A written notice of termination served on the employee, indicating that upon due consideration
of all the circumstances, grounds have been established to justify his termination.

The first written notice to be served on the employees should contain the specific causes or grounds for
termination against them, and a directive that the employees are given the opportunity to submit their
written explanation within a reasonable period. Reasonable opportunity under the Omnibus Rules
means every kind of assistance that management must accord to the employees to enable them to prepare
adequately for their defense.15 This should be construed as a period of at least five (5) calendar days from
receipt of the notice to give the employees an opportunity to study the accusation against them, consult a
union official or lawyer, gather data and evidence, and decide on the defenses they will raise against the
complaint. Moreover, in order to enable the employees to intelligently prepare their explanation and
defenses, the notice should contain a detailed narration of the facts and circumstances that will serve as
basis for the charge against the employees. A general description of the charge will not suffice. Lastly, the
notice should specifically mention which company rules, if any, are violated and/or which among the
grounds under Art. 282 is being charged against the employees.

After serving the first notice, the employers should schedule and conduct a hearing or conference wherein
the employees will be given the opportunity to: (1) explain and clarify their defenses to the charge against
them; (2) present evidence in support of their defenses; and (3) rebut the evidence presented against them
by the management. During the hearing or conference, the employees are given the chance to defend
themselves personally, with the assistance of a representative or counsel of their choice. Moreover, this
conference or hearing could be used by the parties as an opportunity to come to an amicable settlement.

After determining that termination of employment is justified, the employers shall serve the employees a
written notice of termination indicating that: (1) all circumstances involving the charge against the
employees have been considered; and (2) grounds have been established to justify the severance of their
employment.

Respondent was not issued a written notice charging him of committing an infraction. A verbal appraisal
of the charges against an employee does not comply with the first notice requirement.

The court observed from the irregularity reports against respondent for his other offenses that such
contained merely a general description of the charges against him. The reports did not even state a
company rule or policy that the employee had allegedly violated.

No hearing was conducted. Regardless of respondents written explanation, a hearing was still
necessary in order for him to clarify and present evidence in support of his defense. Moreover,
respondent made the letter merely to explain the circumstances relating to the irregularity in his October
28, 2001 Conductors Trip Report. He was unaware that a dismissal proceeding was already being
effected. Thus, he was surprised to receive the November 26, 2001 termination letter indicating as
grounds, not only his October 28, 2001 infraction, but also his previous infractions.

WHEREFORE, the petition is PARTLY GRANTED and the September 16, 2004 Decision of the CA
is MODIFIED by deleting the award of backwages and 13th-month pay. Instead, petitioner KKTI is
ordered to indemnify respondent the amount of thirty thousand pesos (PhP 30,000) as nominal damages
for failure to comply with the due process requirements in terminating the employment of respondent.