LABOR LAW 1; WEEK 1 DIGESTS
RATIO:
Philippine Association of Service Exporters, Inc. v.
FACTS:
1. PASEI, a firm engaged in the recruitment of OFWs,
challenges the constitutionality of Dept. Order No. 1
(1988) of DOLE or the guidelines on the temporary
suspension of deployment of Filipino domestic and
household workers.
2. It claimed that said order discriminates against males
and females, does not apply to all Filipino workers but
only to domestic helpers and females with similar
skills, and is violative of the right to travel.
3. It contends that it is an invalid exercise of the
lawmaking power, police power being legislative, and
not executive in character.
4. PASEI invoked Sec. 3, Art. 13 of the Constitution
providing for worker participation in policy and
decision-making process affecting their rights and
benefits and the order was passed without prior
consultations.
5. The SolGen invoked the police power of the State in
submitting the validity of the guidelines and informed
the Court that the Labor Secretary already lifted the
deployment ban in certain states.
6. It is admitted that the order is in the nature of a police
power measure.
ISSUE: Whether the order is valid under the Constitution.
YES.
 Official acts enjoy presumed validity (no clear and
convincing evidence was shown to the contrary).
 Police power: State authotity to enact legislation that
may interfere with personal liberty or property in
order to promote the general welfare.
 Police power constitutes an implied limitation on
the Bill of Rights.
 Equality before the law admits classifications provided
that it rest on substantial distinctions, germane to the
purposes of the law, not confined to existing conditions
and apply equally to all members of the same class.
 The unhappy plight that the female labor force
experience abroad compels urgent Government
action.
 The same cannot be said for male workers (save for
some isolated cases) so the classifications are borne by
evidence; discrimination is justified.
 DO No. 1 is a valid implementation of the Labor Code
to “afford protection to labor.”
 Not an invalid exercise of legislative power because the
Labor Code itself vests the DOLE with rule-making
powers.
 “Protection to Labor” does not signify the promotion of
employment alone. The Constitution wants that
employment be decent, just, and humane.
 The Government is duty-bound to insure that our
toiling expatriates have adequate protection,
personally and economically, while away from home
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 and as part of its duty, it has ordered an indefinite ban
on deployment.
 The petitioner’s reliance on the Constitutional
guaranty of worker participation in policy making
processes must submit to the demands and necessities
of the State’s power of regulation.
 The court understands the grave implications of the
Order to recruitment businesses but it is the State’s
interest to provide a decent living to its citizens.
St. Luke’s Medical Center Employee’s Association-
AFW v. NLRC, 517 SCRA 677 (2007);
FACTS:
1. Santos was hired as x-ray technician of SLMC (1984).
2. 1992: Congress passed RA 7431 known as the
Radiologic Technology Act of 1992. This law required
that no person shall practice as an x-ray technologist
without having obtained the proper certificate of
registration from the Board of Radiologic Technology.
3. The HR Director of SLMC issued a final notice to all
practitioners of Radiologic Technology to comply with
RA 7431, otherwise, the unlicensed employee will be
transferred to an area which does not require a license
if a slot is available.
4. Santos received a notice requiring her to take and pass
the exam, otherwise, she may be compelled to retire
from employment should there be no other position
available.
5. Another memorandum was issued to Santos advising
her that only a license can assure her of her continued
employment and that it was her last chance to take and
pass the exam.
6. Santos was informed that the management of SLMC
has approved her retirement in lieu of separation pay.
7. The Personnel Manager of SLMC issued a “Notice of
Separation from the Company” to Santos due to her
refusal to accept the offer for early retirement. Further,
it said that her qualifications do not fit any of the
present vacant positions in the hospital.
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8. The President of the Philippine Association of
Radiologic Technologists asked SLMC to give Santos
due consideration by giving her an assignment in any
department in the hospital awaiting her chance to pass
the Board exam.
9. Another Notice of Separation was issued to Santos
after she failed to present her appeal for rechecking to
PRC of the recent board exam which she failed.
10. Santos filed a complaint against SLMC for illegal
dismissal and non-payment of salaries and benefits.
11. The Alliance of Filipino Workers President
requested SLMC to accommodate Santos and assign
her to a vacant position. In response, SLMC said that
Santos must go through the usual application
procedures.
12. Petitioners: Santos’ failure to comply with the
certification requirement did not constitute just case
for termination as it violated her right to security of
tenure.
13. Labor Arbiter: Ordered SLMC to pay Santos her
separation pay. All other claims were dismissed.
14. NLRC and CA affirmed.
ISSUES:
1. Whether Santos’ constitutional right of security of
tenure was violated. NO.
2. Whether Santos was illegally dismissed on the basis
of her inability to secure a certificate of registration
from the Board of Radiologic Technology. NO.
RATIO:
 While the security of tenure is guaranteed by the
Constitution, its exercise may be regulated pursuant to
the police power of the State to safeguard health,
morals, peace, education, order, safety, and the general
welfare of the people.
 The state is justified in prescribing the specific
requirements for x-ray technicians.
 The law is clear that the Certificate of Registration
cannot be substituted by any other requirement to
allow a person to practice as a technician.
 Persons who desire to engage in the learned profession
may be required to take an exam as a prerequisite to
engage in their careers.
 No malice or ill-will can be imputed upon SLMC
because her continued employment without a
certificate exposes the hospital to possible sanctions or
license revocation.
 Santos was given enough opportunity to qualify for the
position but she still failed to comply.
 Management has rights which are also entitled to
respect and enforcement in the interest of fair play.
Magana v. Medicard Phil., Inc., 638 SCRA 606 (2010);
FACTS
1. Medicard, a health maintenance organization, hired
Magana as company nurse who was detailed to
Medicard’s corporate client (Manila Pavilion).
2. Medicard was summarily replaced with another nurse.
Medicard then offered Magana the position of liaison
officer.
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3. Magana found the offer unacceptable and with her
continued non-assignment, she sued Medicard and
Manila Pavilion in the NLRC for illegal dismissal and
payment of benefits and damages.
4. Labor Arbiter: Medicard was a mere labor contractor
for Manila Pavilion which exercised control and
termination powers over Magana. The summary
replacement was without cause and of bad faith.
Ordered Manila Pavilion to reinstate Magana and with
Medicard, be solidarily liable for backwages, etc.
5. NLRC: Affirmed, but found Medicard, not Manila
Pavilion, as Magana’s employer and held it liable for
constructive illegal dismissal and for the payment of
the backwages. Also awarded reinstatement wages for
Medicard’s failure to reinstate her pending appeal as
required by the Labor Code.
6. CA: Found Magana’s dismissal with cause, noting that
Medicard’s failure to assign Magana to a suitable
position within six months after her replacement is
“analogous to a suspension of operations of an
enterprise” entitling her of separation pay only.
Deleted reinstatement wages.
ISSUE: Whether Magana is entitled to draw wages under
an arbiter’s ruling ordering her reinstatement even
though such order is subsequently reversed on appeal.
 HELD: YES. The unusual, mandatory mandatory order
by law to execute reinstatement orders pending
appeal, unheard of in ordinary civil proceedings, is a
police power measure, grounded on the theory that the
preservation of the lives of the citizens is a basic duty
of the State that is more vital than the preservation of
corporate profits.
 The employee shall either be admitted back to work
under the same terms and conditions prevailing prior
to his dismissal or separation or, at the option of the
employer, merely reinstated in the payroll. This must
be done immediately upon the filing of their
appeal, without need of any executory writ.
 Even if the order of reinstatement of the Labor Arbiter
is reversed on appeal, it is obligatory on the part of the
employer to reinstate and pay the wages of the
dismissed employee during the period of appeal until
reversal by the higher court.
JMM Promotion Management, Inc. v. CA, G.R. No.
120095, August 5, 1996;
1. Pres. Cory Aquino ordered a total ban against the
deployment of performing artists to Japan and other
foreign destinations after the death of Maricris Sioson.
2. The ban was rescinded after leaders of the overseas
employment industry promised to extend full support
for a program aimed at removing kinks in the
deployment system.
3. The government issued Dept. Order No. 28 creating
Entertainment Industry Advisory Council (EIAC),
tasked to issue guidelines on the training, testing
certification and deployment of artists abroad.
4. Pursuant to EIAC’s recommendations, Labor Sec issued
Dept. Order No. 3 establishing various procedures
and requirements for screening artists.
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5. Artists successfully hurdling the test, training and
certification were to be issued Artists Record Book
(ARB), a necessary prerequisite to processing of any
contract of employment by the POEA.
6. The Dept. of Labor issued a series of orders for fine-
tuning and implementing the new system.
7. The Federation of Entertainment Talent Managers of
the Philippines (FETMOP) filed a class suit assailing
these Department Orders saying that they violated the
constitutional right to travel, abridged existing
contracts for employment, and deprived individual
artists of their licenses without due process of law.
Further contended that it violated the right to life,
liberty, and property.
8. JMM Promotion and Kary International (Petitioners)
filed a Motion for Intervention.
9. TC: Denied petitioners’ prayer for a writ of preliminary
injunction and dismissed the complaint.
10. CA: Dismissed the appeal. The Department orders
and issuances constituted a valid exercise by the State
of the police power.
ISSUE: Whether the ARB requirement and Department
Order No. 3 were valid exercise of police power. YES.
RATIO:
 Salus populi est suprema lex embodies the character of
the entire spectrum of public laws aimed at promoting
the general welfare of the people under the State’s
police power.
 It is an inherent attribute of sovereignty which extends
to all public needs.
 Police power concerns government enactments which
precisely interfere with personal liberty or property in
order to promote the general welfare or the common
good.
 This Court took judicial notice not only of the trend, but
also of the fact that most of our women, a large number
employed as domestic helpers and entertainers,
worked under exploitative conditions “marked by
physical and personal abuse.”
 The government began instituting measures aimed at
deploying only those individuals who met set
standards which would qualify them as legitimate
performing artists.
 The tests are aimed at segregating real artists or
performers from those passing themselves off as such,
eager to accept any available job and therefore
exposing themselves to possible exploitation.
ON DUE PROCESS and RIGHT TO LABOR AS
PROPERTY:
 The proper regulation of a profession, calling, business
or trade has always been upheld as a legitimate subject
of a valid exercise of the police power by the state.
 So long as professionals and other workers meet
reasonable regulatory standards no such deprivation
exists.
Eagle Security Agency, Inc. v. NLRC, G.R. No. 81314,
May 18, 1989
FACTS:
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1. Petitioners Philippine Tuberculosis Society (PTSI) and
Eagle Security Agency entered into a “Contract for
Security Services” wherein Eagle will provide security
services in PTSI’s premises (1979-1985).
2. Private respondents were assigned by Eagle to PTSI as
security guards.
3. 1985: A complaint was filed by private respondents
against PTSI and Eagle for unpaid wage and allowance
increases.
4. Labor Arbiter: Ordered Eagle and PTSI to pay jointly
and severally the wages.
5. PTSI and Eagle appealed. Still ordered to pay.
6. Motion for Reconsideration. Denied by NLRC for lack of
merit.
7. PTSI and Eagle filed for separate petitions for
certiorari.
8. A TRO was issued enjoining the NLRC from enforcing
its decision.
9. PTSI: Payment of the wage shall be borne exclusively
by Eagle pursuant to the Contract.
10. Eagle: PTSI should be liable pursuant to Wage Order
Nos. 3, 5 and 6 (…increase in the minimum wage shall
be borne by the principal or client of the service
contractor…)
11. PTSI: To uphold the ruling of the NLRC would be
violative of the Constitutional prohibition against
impairment of the obligation of contracts.
ISSUES:
1. Whether the wage orders would violate the non-
impairment clause. NO, they are labor standard
legislations enacted pursuant to the police
power of the State.
2. Whether PTSI and Eagle are solidarily liable for the
unpaid wages. YES.
RATIO:
1. They are enacted to alleviate the plight of the workers
whose wages barely meet the spiraling costs of their
basic needs. The increase in the minimum wage was
ordered precisely to ensure the workers’ health,
efficiency and well-being towards achieving the
country’s goal of ensuring increased productivity and
viability of business and industry.
2. Petitioners’ solidary liability finds support in Articles
106, 107 and 109 of Labor Code. It is mandated to
assure compliance of the provisions therein including
the statutory minimum wage. It facilitates payment of
the workers’ performance of any work, task, job or
project, giving protection as mandated by the
Constitution.
Solidary liability does not preclude the right of
reimbursement from the co-debtor by the one who
paid.
Ultimate liability for the payment of the
increases rests with the principal.
CONST., Art. II, Secs. 5 & 10; Art. XIII, Secs. 1 & 2
Calalang v. Williams, 70 Phil. 726 (1940); Fr. Joaquin
Bernas, The 1987 Philippine
FACTS:
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1. Calalang, in his capacity as citizen and taxpayer, filed a
petition for a writ of prohibition against Williams,
Chairman of National Traffic Commission, the Director
of Public Workes, the Acting Secretary of Public Works
and Communications, Mayor of the City of Manila, and
acting Chief of Police.
2. Calalang: The National Traffic Commission resolved to
recommend that animal-drawn vehicles be prohibited
from passing along Rosario Street and Rizal Avenue for
a period of one year from the opening of the Colgante
Bridge to traffic.
3. This measure was pursuant to the provisions of CA 548
authorizing the Director of Public Works to
promulgate rules and regulations to regulate and
control the use of and traffic on national roads.
4. Calalang: Rules and regulations infringe upon the
constitutional precept regarding the promotion of
social justice to insure the well-being and economic
security of all the people.
ISSUE: Whether the rules and regulations infringe upon
the constitutional precept regarding the promotion of
social justice. NO.
RATIO:
 Social justice is “neither communism, nor despotism,
nor atomism, nor anarchy,” but the humanization of
laws and the equalization of social and economic forces
by the State so that justice in its rational and
objectively secular conception may at least be
approximated.
 Social justice means the promotion of the welfare of all
the people, the adoption by the Government of
measures calculated to insure economic stability of all
the competent elements of society, through the
maintenance of a proper economic and social
equilibrium in the interrelations of the members of the
community, constitutionally, through the adoption of
measures legally justifiable, or extra constitutionally,
through the exercise of powers underlying the
existence of all governments on the time-honored
principle of salus populi est suprema lex.
 Social justice is bringing about “the greatest good
to the greatest number.”
HFS Phil., Inc. v. Pilar, G.R. No. 168716, April 16,
2009;
FACTS:
1. Pilar was engaged by IUM Shipmanagement and its
Philippine manning agent, HFS Philippines, as a crew
member (electrician) of the Norwegian vessel.
2. Four months after he boarded, he complained of loss of
appetite, nausea, vomiting, and severe nervousness.
His condition did not improve despite being given
medical treatment.
3. He was diagnosed with depression and gastric ulcer.
The physician declared him unfit for work and
recommended hospitalization and repatriation. He
returned to Manila same day.
4. He was met by an HFS representative who brought him
to Medical Center where it was confirmed that he was
suffering from major depression.
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5. He was placed under continuous medical treatment for
several months.
6. He was later on declared fit to work.
7. He sought the opinion of other physicians. One said he
was still depressed and the other with illnesses making
him unfit to work.
8. He then filed a complaint for underpayment of
disability and medical benefits and for damages in the
NLRC. NLRC referred the case to the National
Conciliation and Mediation Board because he was a
registered member of the Seaman’s Union.
9. Pilar: He was hit by an officer on the head. He was
traumatized and from there, all he symptoms started
showing. He claimed to be entitled to disability
compensation under Art. 12 of the CBA between
AMOSUP and the Norwegian Shipowner’s Assoc.
10. Petitioners: In the absence of proof that his
depression was caused by an accident, he is not
entitled to disability and medical benefits. Instead, he
was only entitled to the 120-day sick pay as provided
in the CBA.
11. NCMB: Pilar’s depression was a compensable
sickness since it arose out of his employment. In view
of the principle of social justice, that those who have
less in life should have more in the law, he was
awarded disability compensation.
12. CA: He was not entitled to disability compensation
granted by the CBA but is entitled to disability benefits
granted by Sec. 32 of the employment contract after
proving that his illnesses impaired him.
ISSUE: Whether Pilar is entitled to disability
compensation. YES, under the employment contract.
RATIO:
 Pilar is clearly entitled to sick pay because he fell ill
while on board the vessel as provided by the CBA.
 However, the CBA does not cover all kinds of illnesses
such as those suffered by Pilar. Neither the NCMB nor
the CA found that his illnesses were the result of an
accident or a marine peril.
 A seafarer may be entitled to disability compensation
if (1) he is shown to have contracted an illness or
suffered an injury in the course of his employment and
(2) such illness or injury resulted in his total or partial
disability.
 The discrepancy between the findings of the company
doctor and Pilar’s doctor would make or break his
claim. The Court, thus, adopts the findings favorable to
Pilar.
 The law looks tenderly on the laborer. Where the
evidence may be reasonably interpreted in two
divergent ways, one prejudicial and the other
favorable to him, the balance must be tilted in his
favor consistent with the principle of social justice.
PLDT v. NLRC,* 164 SCRA (1988);
FACTS:
1. Abucay, a traffic operator of PLDT, was accused by two
complainants of having demanded and received
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 P3,800 in consideration of her promise to facilitate the
application approval for telephone installation.
2. She was found guilty and was separated from the
service.
3. She went to the Ministry of Labor and Employment
claiming she had been illegally removed. Complaint
dismissed but she was awarded one month pay for
every year of service as financial assistance and for
reasons of equity and compassion.
4. PLDT and Abucay appealed to the NLR Board.
Dismissed.
5. PLDT questions the affirmance of the award as having
been made with grave abuse of discretion. An
employee dismissed for cause is entitled to neither
reinstatement nor backwages and is not allowed any
relief at all because the dismissal is accordance with
law.
6. NLRC: Abucay is sufficiently punished with her
dismissal.
7. SolGen: Separation pay allowed on grounds of social
and compassionate justice.
ISSUE: Whether Abucay is entitled to the separation pay.
NO.
RATIO:
 General rule: A person dismissed for cause is not
entitled to separation pay.
 Exception: Equity. It is grounded on the precepts of
conscience and not on any sanction of positive law.
 The Constitution is replete with positive commands for
the promotion of social justice, and particularly the
protection of the rights of the workers.
 Separation pay shall be allowed as a measure of
social justice only in those instances where the
employee is validly dismissed for causes other
than serious misconduct or those reflecting on his
moral character.
 The policy of social justice is not intended to
countenance wrongdoing simply because it is
committed by the underprivileged. At best it may
mitigate the penalty but it certainly will not condone
the offense. Compassion for the poor is an imperative
of every humane society but only when the recipient is
not a rascal claiming an undeserved privilege.
 This great policy of our Constitution is not meant for
the protection of those who have proved they are not
worthy of it, like the workers who have tainted the
cause of labor with the blemishes of their own
character.
 Abucay was dismissed for dishonesty. The fact that
she worked with PLDT for more than a decade
should even be taken against her as in reflects a
regrettable lack of loyalty. If regarded as
justification for moderating penalty, it will pervert
the meaning of social justice and undermining the
efforts of labor to cleanse its ranks of all
undesirables.
Toyota Motor Phil. Corp. Workers Association v.
NLRC,* G.R. No. 158786, October 19, 2007;
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FACTS:
1. The Union is a legitimate labor organization and is
certified as the sole and exclusive bargaining agent of
all Toyota rank and file employees.
2. Toyota is a domestic corporation engaged in the
assembly and sale of vehicles and parts.
3. Toyota challenged the said Order via an appeal to the
DOLE Secretary.
4. In the meantime, the Union submitted it CBA proposals
to Toyota but it refused to negotiate pending appeal.
5. The Union filed a Notice of strike which was converted
by the NCMB to a preventive mediation case pending
the appeal.
6. The Union and Toyota were required to attend a
hearing.
7. The Union officers and members failed to render the
required overtime work and instead marched and
staged a picket in front of the BLR Office. It also
requested that its members be allowed to be absent to
attend the hearing. Toyota denied the request.
8. Despite the denial, more than 200 employees staged
mass actions in front of the BLR and the DOLE Offices
to protest.
9. Due to their absence, Toyota experience acute lack of
manpower in its manufacturing and production lines
and was unable to meet its goals resulting to losses of
P53M.
10. Toyota sent individual letters to 360 employees
requiring them to explain within 24 hours why they
should not be dismissed for defiance of company’s
order to render overtime work, failure to report, and
participation in the actions.
11. The Union again filed for another notice of strike for
union busting amounting to unfair labor practice. But
submitted their explanation.
12. Toyota terminated the employment of 227
employees for participation in concerted actions in
violation of its Code of Conduct and for misconduct
under Art. 282 of the Labor Code.
13. The Union went on another strike and barricaded
the plants and prevented workers who reported for
work from entering therefrom.
14. Toyota filed a petition for injunction and issuance of
a TRO before the NLRC. Approved. It also filed a
petition to declare the strike illegal.
15. The Secretary of Labor ordered all striking workers
to return to work and for Toyota to accept the
returning employees, under same terms or put them
under payroll reinstatement (which it chose).
16. Despite orders, several payroll-reinstated members
of the Union staged a protest rally and picketed in the
Bicutan and Sta. Rosa plants.
17. NLRC considered the mass action illegal.
18. CA deleted the award of severance compensation to
the dismissed Union members considering the illegal
strikes as serious misconduct.
ISSUES:
1. Whether the mass actions committed by the Union on
different occasions are illegal strikes. YES.
2. Whether separation pay should be awarded to the
Union members who participated in the illegal strikes.
NO.
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RATIO:
 These strikes were illegal because unlawful means
were employed. The acts of the Union officers and
members are in palpable violation of Art. 264(e), which
proscribes acts of violence, coercion, or intimidation,
or which obstruct the free ingress to and egress from
the company premises. Undeniably, the strikes from
March 28 to April 12, 2001 were illegal.
 The Union, by its mass actions, has inflamed an already
volatile situation, which was explicitly proscribed by
the DOLE Secretary’s Order.
 One exception where separation pay is given even
though an employee is validly dismissed is when there
is justification in applying the principle of social justice.
 There can be no good faith in intentionally incurring
absences in a collective fashion from work just to
attend the DOLE hearings.
 The Union’s strategy was plainly to cripple the
operations of Toyota.
 The Union officials and members are supposed to
know through common sense that huge losses would
befall the company by the abandonment of their
regular work.
 They were also fully aware of the company’s
prohibition against concerted action inimical to the
interests of the company.
 They violated the order of the DOLE Secretary,
exhibiting lack of obeisance to the rule of law.
Yrasuegui v. PAL, G.R. No. 168081, October 17, 2008;
FACTS:
1. Yrasuegui was a former international flight steward of
PAL, he was dismissed because of his failure to adhere
to the weight standards of PAL.
2. The ideal weight for his height (5’8”) is 166 lbs. as
mandated by the Cabin and Crew Administration
Manual of PAL.
3. PAL advised him to go on an extended vacation leave
to address his weight concerns. He failed to meet the
standards prompting another leave without pay.
4. After meeting the required weight, he was allowed to
return to work. But his weight problem recurred. He
again went on leave without pay.
5. In line with company policy, he was removed from
flight duty and was formally requested to trim down to
his ideal weight.
6. When he went back for a weight check, it was
discovered that he gained weight (215 lbs.).
7. Yrasuegui, in a letter, made a commitment addressed
to the Cabin Crew Group Manager to reduce weight.
8. Despite the ninety-day period given him to reach his
ideal weight, he remained overweight. He remained
grounded. He was directed to report every two weeks
for weight check but he failed to go.
9. He was still given one more month to comply. He
continuously ignored all directives to report back for
weight checks.
10. He requested for leniency but PAL finally served a
Notice of Administrative Charge for violation of
company standards on weight requirements. He was
given 10 days to file his answer.
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11. Yrasuegui: His violation, if any, had already been
condoned since no action has been taken by the
company regarding the case. And that PAL
discriminated against him because the company has
not been fair in treating the cabin crew members who
are similarly situated.
12. After a hearing, Yrasuegui was informed that due to
his inability to attain his ideal weight, and considering
the utmost leniency given to him, his services were
considered terminated effective immediately.
13. He filed for illegal dismissal against PAL.
14. Labor Arbiter: Illegally dismissed. Weight
standards need not be complied with under pain of
dismissal since his weight did not hamper the
performance of his duties. Directed reinstatement.
15. NLRC: Affirmed, entitled to full backwages. Obesity
is a disease in itself. There can be no intentional
defiance or serious misconduct to lawful order of PAL.
16. CA: Reversed, NLRC looked at wrong and irrelevant
considerations. Weight standards of PAL are meant to
be continuing qualification for an employee’s position.
Failure to adhere is an analogous cause for dismissal.
ISSUES:
1. Whether Yrasuegui’s obesity is a ground for dismissal.
YES.
2. Whether he was unduly discriminated against when he
was dismissed. NO.
3. Whether he is entitled to reinstatement and
backwages. NO, but he is entitled to separation pay.
RATIO:
 The weight standards were a continuing qualification
to keep his job.
 He was able to reduce weight so it clearly shows that it
is possible for him to lose weight. He also repeatedly
ignored all requests for weight checks.
 His obesity may not be unintended but it is voluntary.
 PAL has committed itself to safely transport its
passengers. In order to achieve this, it must necessarily
rely on its employees, its cabin flight deck crew on
board the aircraft.
 The weight standards should be viewed as imposing
strict norms of discipline upon its employees.
 He failed to prove that he complied with the return to
work order of PAL.
 No record of him actually rendering services for PAL
when he was dismissed, in order to insist on the
payment of his full backwages.
 Separation pay is granted to a legally dismissed
employee as an act of “social justice” or based on
“equity.”
 In both instances, it is required that the dismissal
(1) was not for serious misconduct and (2) does not
reflect on the moral character of the employee.
Digital Telecommunications Phils., Inc. v. Ayapana,
G.R. No. 195614, [January 10, 2018]
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.
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Even there is a valid dismissal, separation pay may be
granted as a measure of social justice.
FACTS:
Petitioner hired respondent as Key Accounts
Manager for its telecommunication products and services.
Respondent was tasked, among others, to offer and sell
DIGITEL's foreign exchange (FEX) line to prospective
customers.
Respondent successfully offered two (2) FEX lines for
Atimonan, Quezon, to Estela Lim. He received from Lim
the total amount of ₱7,000.00 for the two lines, for which
he issued two (2) official receipts. Respondent, however,
did not remit the subject amount to petitioner on the same
date.
Respondent learned, from his immediate superior, that
there was no available FEX line in Atimonan, Quezon; and
that it was not possible to have a FEX line in the area due
to technical constraints. On the same day, respondent
retrieved from Lim the two (2) official receipts issued to
the latter and replaced them with an acknowledgment
receipt.
The secretary of Lim, went to petitioner's business office
to pay bills and to ask for the refund of the subject amount
but there was no existing application for the said service
under the name of Star Lala Group of Companies. The
respondent was notified about the request of refund and
five (5) days from said notice, that respondent was able to
make the refund.
Petitioner issued a Notice to Explain to respondent, asking
him to explain in which the respondent submitted a
written response. On 4 December 2006, petitioner sent a
Notice of Offense to respondent, scheduling his
administrative hearing and requesting his presence there.
On 19 January 2007, petitioner issued a Notice of
Dismissal finding respondent guilty of "breach by the
employee of the trust and confidence reposed in him by
management or by a company representative" under
petitioner's disciplinary rules, which merited dismissal
for the first offense.
Aggrieved, respondent filed a complaint for illegal
dismissal.
ISSUE:
1. Is the respondent guilty of breach of trust and
confidence reposed in him by the petitioner?
2. Is the respondent entitled to separation pay despite
there is a valid dismissal?
RULING:
1. Yes. Respondent held a position of trust and
confidence and committed an act that justified
petitioner's loss of trust and confidence.
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.
However, the validity of a dismissal based on this
ground is premised upon the concurrence of these
conditions: (1) the employee concerned must be
holding a position of trust and confidence; and (2)
there must be a willful act that would justify the loss of
trust and confidence.
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The first requisite is certainly present. In a number of
cases, this Court has held that rank-and-file employees
who are routinely charged with the care and custody of
the employer's money or property are classified as
occupying positions of trust and confidence. It is not
disputed that respondent was tasked to solicit
subscribers for petitioner's FEX line and, in the course
thereof, collect money for subscriptions and issue
official receipts therefor, as was the case in the
transaction subject of this controversy. Being involved
in the handling of the company's funds, respondent
undeniably occupies a position of trust and confidence.
The records likewise reveal that the second requisite is
present. It must be emphasized that a finding that an
employer's trust and confidence has been breached by
the employee must be supported by substantial
evidence, or such amount of relevant evidence which a
reasonable mind might accept as adequate to justify a
conclusion. It must not be based on the employer's
whims or caprices or suspicions; otherwise, the
employee would eternally remain at the mercy of the
employer.
The totality of the circumstances in the case at bar
supports a conclusion that respondent's dismissal was
based on substantial evidence that he had willfully
breached the trust reposed upon him by petitioner,
and that petitioner was not actuated by mere whim or
capriciousness.
2. YES. Even with a finding that respondent was
validly dismissed, separation pay may be granted as
a measure of social justice.
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.
Here, while it is clear that respondent's act
constitutes a willful breach of trust and confidence
that justified his dismissal, it also appears that he
was primarily actuated by zealousness in acquiring
and retaining subscribers rather than any intent to
misappropriate company funds; as he admitted in
his response to the notice to explain that offering an
alternative FEX line to Lim was part of his strategy
to ensure her subscription.
Respondent’s zealousness was manifested through
acts that showed an inordinate lapse of judgment
warranting his dismissal in accordance with
management prerogative, but this Court considers
in his favor the above circumstances in granting him
separation pay in the amount of one (1) month pay
for every year of service.
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