Areno, Jr. v. Skycable PCC-Baguio February 5, 2010 G.R. No. 180302 611 SCRA 721

Facts:

                Disciplinary action against an erring employee is a management prerogative which, generally, is not a subject  to judicial interference. However, this policy can be justified only if the disciplinary action is dictated by legitimate business reasons and is not oppressive.

On January 17, 1995, petitioner was employed as a cable technician by respondent Skycable PCC-Baguio. On January 17, 2002, an accounting clerk of respondent, Hayacinth Soriano (Soriano), sent to the human resource manager a letter-complaint against petitioner alleging that on two separate occasions, the latter spread false rumors about her. On January 27, 2002, she was again insulted by petitioner when the latter approached her and said that she was seen  going out with Aldrin Estrada, their field supervisor and uttered “Ikaw lang ang nakakaalam ng totoo” with malicious intent and in provocative manner. Soriano averred that petitioner’s unscrupulous behaviour constituted serious and grave offense in violation of the company’s Code of Discipline.

On the same day, respondent issued a Memorandum requiring petitioner to submit an explanation within 76 hours from notice thereof. Petitioner submitted his written-explanation denying all allegations in Soriano’s letter-complaint. An administrative investigation was accordingly conducted. The investigating committee found petitioner guilty made malicious statements against Soriano which is categorized as an offense under the Company Code of Discipline.

Consequently, petitioner was suspended for 3 days without pay, however, petitioner still reported for work. By reason thereof, respondent sent petitioner a letter denominated as 1^st Notice of Termination. Petitioner inquired from respondent whether he is already dismissed or merely suspended since he was refused entry to the company premises but the respondent replied that he was merely suspended.  Petitioner then wrote to respondent requesting for further investigation on his alleged act of spreading rumors but his request was denied.

Petitioner submitted to respondent his written explanation averring that he still reported for work on the first day of his suspension because the accusation of Soriano is baseless and her testimony is hearsay. Petitioner was dismissed from service on the ground of insubordination or wilful disobedience in complying with the suspension order.

  Petitioner filed a complaint against the respondent assailing the legality of his suspension and eventual dismissal. He claimed that his suspension and dismissal were effected without any basis, and that he was denied in his right to due process.

Issue: WON Areno Jr. was illegally dismissed.

Ruling:

                No. The decision to suspend petitioner was rendered after investigation and a finding by respondent that petitioner has indeed made malicious statements against a co-employee. The suspension was imposed due to a repeated infraction within a deactivation period set by the company relating to previous similar offense committed. It is axiomatic that appropriate  disciplinary sanction is within the purview of management imposition. What should not be overlooked is the prerogative of an employer company to prescribe reasonable rules and regulations necessary for the proper conduct of its business and to provide certain disciplinary measures in order to implement said rules to assure that the same would be complied with. Respondent then acted within its rights as an employer when it decided to exercise  its management prerogative to impose disciplinary measure on its erring employee.

                As a just cause for dismissal of an employee under Article 282 of the Labor Code, wilful disobedience of the employer’s lawful orders requires the concurrence  of two elements: 2) the employee’s assailed conduct must have been wilful; and 20 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. Both requisites are present in the instant case.

Coca Cola Bottlers Inc. v. Climaco February 5, 2007 G.R. No. 146881 514 SCRA 164

Facts: 

             Respondent Dr. Dean N. Climaco is a medical doctor who was hired by petitioner Coca-Cola Bottlers Phils., Inc (Coca-Cola),  by virtue of a Retainer Agreement. The Retainer Agreement, which began on January 1, 1988, was renewed annually. The last one expired December 31, 1993. Despite the non-renewal of the Retainer Agreement, respondent continued to perform his functions as company doctor to Coca-Cola until he received a letter from petitioner company concluding their retainership agreement. It is noted that as early as September 1992, petitioner was already making inquiries regarding his status with petitioner company. Petitioner company, however, did not take any action. Respondent inquired from the management of petitioner company whether it was agreeable to recognize him as a regular employee. The management refused to do so.

                Respondent filed a Complaint before the NLRC seeking recognition as a regular employee of petitioner company and prayed for the payment of all benefits of a regular employee. While the complaint was pending before the Labor Arbiter, respondent received a letter from petitioner company concluding their retainership agreement effective 30 days from receipt thereof. This prompted respondent to file a complaint for illegal dismissal against petitioner company. Respondent contend . The Labor Arbiter and NLRC declared that there is no employer-employee relationship existed between the parties. However, the Court of Appeals declared that respondent should be classified as a regular employee having rendered 6 years of service as plant physician by virtue of several renewed retainer agreements.

Issue: WON there exist an employer-employee relationship between the parties

Ruling:

                The court, in determining the existence of an employer-employee relationship, has invariably adhered to the four-fold test: (1) the selection and engagement of the employee; (2) the payment of wages; (3) the power of dismissal;  and (4) the power to control the employee’s conduct.

                The Court agrees with the finding of the Labor Arbiter and the NLRC that the circumstances of this case show that no employer-employee relationship exist between the parties, they correctly found that petitioner company lacked the power of control over the performance by respondent of his duties. The Labor Arbiter reasoned that the Comprehensive Medical Plan, which contains the respondent’s  objectives, duties and obligations, does not tell respondent “how to conduct his physical examination, how to immunize, or how to diagnose and treat his patients, employees of company, in each case.”

                In effect, the Labor Arbiter held that petitioner company, through the Comprehensive Medical Plan, provided guidelines merely to ensure that the end result was achieved, but did not control the means and methods by which respondent performed his assigned tasks.

                The NLRC affirmed the findings of the Labor Arbiter and stated that it is precisely because the company lacks the power of control that the contract provides that respondent shall be directly responsible to the employee concerned and their dependents for any injury, harm or damage caused through professional negligence, incompetence or other valid causes of action.

                In addition, the Court finds that the schedule of work and the requirement to be on call for emergency cases do not amount to such control, but are necessary incidents to the Retainership Agreement. The Court agrees that there is nothing wrong with the employment of respondent as a retained physician of petitioner company and upholds the validity of the Retainership Agreement which clearly stated that no employe-employee relationship existed between the parties. Considering that there is no employer-employee relationship between the parties, the termination of the Retainership Agreement , which is accordance with the provisions of the Agreement, does not constitute illegal dismissal of respondent. 

Francisco v. NLRC August 31, 2006 G.R NO. 170087 500 SCRA 690

Facts:

                Petitioner was hired by Kasei Corporation during its incorporation stage. She was designated as Accountant and Corporate Secretary and was assigned to handle all the accounting needs of the company, however she was not entrusted with the corporate documents; neither did she attend any board meeting nor required to do so. She never prepared any legal document and never represented the company as its Corporate Secretary, but she was prevailed upon to sign documentation for the company. She was also designated as Liason Officer to secure business permits, construction permits and other licenses for the initial operation of the company.

                In 1996, petitioner was designated Acting Manager, she was assigned to handle recruitment of all employees and perform management administration functions. For 5 years, petitioner performed the duties of Acting Manager.

                In January 2001, petitioner was replaced by Liza R. Fuentes as Manager and the petitioner was assured that she would still be connected with Kasei Corporation as Technical Assistant to Seiji Kamura and in charge of all BIR matters. Petitioner did not receive her salary from the company and was informed that she is no longer connected with the company. Petitioner filed an ction for constructive dismissal before the labor arbiter.

                Private respondents averred that petitioner is not an employee of Kasei Corporation. They alleged that as technical consultant, petitioner performed her work at her own discretion without control and supervision of Kasei Corporation. She had no daily time record and she came to the office any time she wanted. The company never interfered with her work except that from time to time, the management would ask her opinion on matters relating to her profession. The petitioner did not go through the usual procedure of selection of employees and her designation as technical consuktant depended solely upon the will of management. As such, her consultancy may be terminated any time considering that her services were only temporary in nature and dependent on the needs of the corporation.

Issue: Won there was an employer-employee relationship between the parties.

Ruling:

                In certain cases the control test is not sufficient to give a complete picture of the relationship between the parties, owing to the complexity of such a relationship where several positions have been held by the worker. There are instances when, aside from the employer’s power to control the employee with respect to the means and methods by which the work is to be accomplished, economic realities of the employment relations help provide a comprehensive analysis of the true classification of the individual, whether as employee, independent contractor, corporate officer or some other capacity.

                The better approach would therefore be to adopt a two-tiered test involving: 1) putative employer’s power to control the employee with respect to the means and methods by which the work is to be accomplished; and 2) the underlying economic realities of the activity or relationship. This two-tiered test would provide us with a framework of analysis, which would take into consideration the totality of circumstances surrounding the true nature of the relationship between the parties. This is especially appropriate in this case where there is no written agreement or terms of reference to base the relationship on; and due to the complexity of the relationship based on the various positions and responsibilities given to the worker over the period of the latter’s employment.

                The determination of the relationship between employer and employee depends upon the circumstances of the whole economic activity, such as: 1) the extent to which the services performed are an integral part of the employer’s business; 2) the extent of the worker’s investment in equipment and facilities; 3) the nature and degree of control exercised by the employer; 4) the worker’s opportunity for profit or loss; 5) the amount of initiative, skill, judgment or foresight required for the success of the claimed independent enterprise; 6) the permanency and duration of the relationship between the worker and the employer; and 7) the degree of dependency of the worker upon the employer of his continued employment in that line of business.

                The proper standard of economic dependence is whether the worker is dependent on the alleged employer for his continued employment in that line of business. Based on the foregoing, there can be no other conclusion that petitioner is an employee of respondent Kasei Corporations. She was selected and engaged by the company for compensation, and is economically dependent upon respondent for her continued employment in that line of business. Her main job function involved accounting and tax services rendered to respondent corporation on a regular basis over an indefinite period of engagement. Respondent corporation hired and engaged petitioner for compensation, with the power to dismiss her for cause. More importantly, respondent corporation had the power to control petitioner with the means and methods by which the work is to be accomplished.

Pantoja v. SCA Hygiene Products April 23, 2010 G.R 163554 619 SCRA 216

Facts:

                Respondent, a corporation engaged in the manufacture, sale, and distribution of industrial paper and tissue products, employed petitioner as a utility man. Petitioner was eventually assigned at respondent’s Paper Mill No. 4, the section which manufactures the company’s industrial paper products, as a back tender in charge of the proper operation of the section’s machineries.

                In a Notice of Transfer, respondent informed the petitioner of its reorganization plan and offered hima  position at Paper Mill No. 5 under the same terms and conditions of employment in anticipation of the eventual closure and permanent shutdown of Paper Mill No. 4. The closure and concomitant reorganization is in line with respondent’s decision to streamline and have out the company’s industrial paper manufacturing operations due to financial difficulties brought about by the low volume of sales and orders for industrial paper products. However petitioner rejected the transfer, thus a notice of termination of employment was sent as his position was decalred redundant by the closure of Paper Mill No. 4.

                Petitioner filed a complaint for illegal dismissal against respondent assailing his termination as without any valid cause. He averred that the alleged redundancy never occurred as there was no permanent shutdown of Paper Mill no. 4 due to its continuous operation since his termination. In its defense, respondent refuted petitioner’s claim of illegal dismissal. It argued that petitioner has voluntarily separated himself from service by opting to avail of the separation benefits of the company instead of accepting reassignment/transfer to another position of equal rank and pay.

Issue: WON petitioner was illegally dismissed.

Ruling:

                No. Respondent’s right of management prerogative was exercised in good faith.

                In this case, the abolishment of Paper Mill No. 4 was undoubtedly a business judgment arrived at in the face of the low demand for the production of industrial paper at the time. Despite an apparent reason to implement a retrenchment program as a cost-cutting measure, respondent, however, did not outrightly dismiss the workers affected by the closure of Paper Mill No. 4 but gave them an option to be transferred to post of equal rank and pay. As can be seen, retrenchment was utilized by respondent only as an available option in case the effected employee would not want to be transferred. Respondent did not proceed directly to retrench. This, to our mind, is an indication of good faith on respondent’s part as it exhausted other possible measures other than retrenchment.

                Besides, the employer’s prerogative to bring down labor costs by retrenching must be exercised essentially as a measure of last resort, after less drastic means have been tried and found wanting. Giving the workers an option to be transferred without any diminution in rank and pay specifically belie petitioner’s allegation that the alleged streamlining scheme was implemented as a ploy to ease out employees, thus, the absence of bad faith. Apparently, respondent implemented its streamlining or reorganization plan with good faith, not in an arbitrary manner and without prejudicing the tenurial rights of its employees.

San Miguel Corporation v. NLRC April 16, 2008 G.R. No. 146121-22 551 SCRA 410

Facts:

                Ernesto Ibias (respondent)  was employed by petitioner SMC as a CRO operator in its Metal Closure and Lithography Plant. He continuously worked therein until he advanced as Zamatic operator. He was also an active and militant member of a labor organization called Ilak Buklod Manggagawa (IBM)-SMC Chapter.

                According to SMC’s Policy on Employee Conduct, absences without permission or AWOPs, which are absences not covered either by a certification of the plant doctor that the employee was absent due to sickness or by duly approved application foe leave of absence filed atleast 6 days prior to the intended leave, are subject to disciplinary action. The same Policy on Employee Conduct also punishes falsification of company records or documents with discharge or termination for the first offense if the offender himself or somebody else benefits from falsification or would have benefited if falsification is not found on time.

                Respondent incurred absences. For his absences on 2, 4 and 11 January and 28 and 29 April, he was given a written warning that he had already incurred 5 AWOPs. For his absences on 28 and 29 April and 7 and 8 May, he was alleged to have falsified his medical consultation card by stating therein that he was granted sick leave by the plant clinic on said dates when in truth he was not. Respondent was required to state in writing why he should not be subject to disciplinary action, he then submitted handwritten explanation to the charges.

                Not satisfied with the explanation, SMC conducted an administrative investigation. After the completion of the investigation, SMC concluded that respondent committed the offenses of excessive AWOP and falsification of company records or documents, and accordingly dismissed him. Respondent filed a complaint for illegal dismissal against SMC.

Issue: WON Ibias was illegally dismissed.

Ruling:

                When SMC imposed the penalty of dismissal for the 12^th and 13^th AWOPs, it was acting well within its rights as an employer. An employer has the prerogative to prescribe reasonable rules and regulations necessary for the proper conduct of its business, to provide certain disciplinary measures in order to implement said rules and to assure that the same would be complied with. An employer enjoys a wide latitude of discretion in the promulgation of policies, rules and regulations on work-related activities of the employees.

                It is axiomatic that appropriate disciplinary sanction is within the purview of management imposition. Thus, in the implementation of its rules and policies, the employer has the choice to do so strictly or not, since this is inherent in its right to control and manage its business effectively. Consequently, management has the prerogative to impose sanctions lighter than those specifically prescribed by its rules, or to condone completely the violations of its erring employees. Of course, this prerogative must be exercised free of grave abuse of discretion, bearing in mind the requirements of justice and fair play.

                All told, we find SMC acted well within its rights when it dismissed respondent for his numerous absences. Respondent was afforded due process and was validly dismissed for cause.