Kulas Ideas & Creations, Gil Francis Maningo and Ma. Rachel Maningo, vs.

Juliet and Flordeliza

Arao-Arao
 Juliet Alcoseba and Flordelinda Arao-arao were employed as sales attendants of KULAS
Ideas & Creations, a gift boutique owned by Gil Francis and Rachel Maningo.
 The DOLE inspected the outlet of KULAS in Cebu where Juliet and Flodelinda were assigned.
It found that it violated several labor standards law.
 The DOLE sent KULAS a Notice of Summary Investigation directing it to pay the salary
differential of its employees.
 KULAS subsequently directed Juliet and Flordelinda, by Memorandum, to explain and/or
investigate an alleged discrepancy. It thereafter suspended Juliet and Flordelinda for 7 days
for gross negligence of duties and responsibilities.
 Both Juliet and Flordelinda filed a complaint for illegal suspension and withholding of
salaries before the NLRC.
 After serving their suspension, the two inquired with KULAS the status of their employment
since they were told not to report for work until they were able to explain the
discrepancies.
 KULAS gave the two 3 days to settle the shortage in the inventory and to explain why they
should not be terminated for gross neglect of duties and responsibilities.
 Juliet and Flordelinda asserted that they were not responsible for the losses.
 KULAS did not reply to the query of Juliet and Flordelinda about their employment status.
 KULAS charged Juliet and Flordelinda for estafa. The complaint was later dismissed.
 Juliet and Flordelinda amended to illegal dismissal their complaint against KULAS at the
NLRC.
 The Labor Arbiter ruled that there was no illegal dismissal.
 On appeal, the NLRC also ruled that there was no illegal dismissal. However, it set aside the
monetary award for lack of jurisdiction.
 The CA reversed and set aside the NLRC’s decision.
ISSUE: whether the respondents’ dismissal for misappropriating company merchandise is
proper. – NO.
RULING:
Art. 282 (b) and (c) of the Labor Code provide that an employer may terminate an employee for
gross and habitual neglect by the employee of his duties and for fraud. In both instances,
substantial evidence is necessary for an employer to effectuate any dismissal. Uncorroborated
assertions and accusations by the employer do not suffice, otherwise the constitutional
guaranty of security of tenure of the employee would be jeopardized. To sustain a termination
of employment based on the said provision, the negligence must not only be gross but also
habitual. Petitioners assert that respondents failed to regularly undertake a monthly physical
inventory of the outlet’s merchandise. The assertion fails to persuade. For the most part,
inventory preparation and reporting did not fall on respondents’ shoulders since they were to
assist the clerk only. The discrepancy in the inventory, even if true, cannot just be attributed to
respondents on the basis of their having access to the boutique’s merchandise. The undue
haste in suspending respondents, even before a full and complete stock inventory and
investigation on the sales discrepancy was yet to be undertaken, betrays petitioners
predisposition to hold respondents guilty.
The Court finds that petitioners failed to comply with the procedural requirements for a valid
dismissal. A first notice informing and bearing on the charge must be sent to the employee.
Here, the only time petitioners apprised respondents of gross neglect of duties and dishonesty
as grounds for the termination of the services was by Memorandum, which did not inform
outright the respondents that an investigation would be conducted on the charges
particularized therein. It likewise did not contain a plain statement of the particular charges of
malfeasance or misfeasance.