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San Miguel Corporation vs. NLRC

Facts: Ibias (respondent) was employed by petitioner SMC on 24 December 1978 initially as a CRO operator in its Metal Closure and Lithography Plant. Respondent continuously worked therein until he advanced as Zamatic operator. He was also an active and militant member of a labor organization called Ilaw 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 a duly approved application for leave of absence filed at least 6 days prior to the intended leave, are subject to disciplinary action characterized by progressively increasing weight. 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.

It appears that per company records, respondent was AWOP on the following dates in 1997: 2, 4 and 11 January; 26, 28 and 29 April; and 5, 7, 8, 13, 21, 22, 28 and 29 May. For his absences on 2, 4 and 11 January and 28 and 29 April, he was given a written warning dated 9 May 1997 that he had already incurred five (5) AWOPs and that further absences would be subject to disciplinary action. For his absences on 28 and 29 April and 7 and 8 May, respondent 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.

After the completion of the investigation, SMC concluded that respondent committed the offenses of excessive AWOPs and falsification of company records or documents, and accordingly dismissed him.

On 30 March 1998, respondent filed a complaint for illegal dismissal against SMC. The labor arbiter believed that respondent had committed the absences pointed out by SMC but found the imposition of termination of employment based on his AWOPs to be disproportionate since SMC failed to show by clear and convincing evidence that it had strictly implemented its company policy on absences. It also noted that termination based on the alleged falsification of company records was unwarranted in view of SMC’s failure to establish respondent’s guilt.

The appellate court also held that respondent’s AWOPs did not warrant his dismissal in view of SMC’s inconsistent implementation of its company policies. It could not understand why respondent was given a mere warning for his absences on 28 and 29 April which constituted his 5th and 6th AWOPs, respectively, when these should have merited suspension under SMC’s policy. According to the appellate court, since respondent was merely warned, logically said absences were deemed committed for the first time; thus, it follows that the subject AWOPs did not justify his dismissal because under SMC’s policy, the 4th to 9th AWOPs are meted the corresponding penalty only when committed for the second time.

Issue: WON the Court of Appeals erred in sustaining the findings of the labor arbiter and the NLRC and in dismissing SMC’s claims that respondent was terminated from service with just cause.

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Held: Proof beyond reasonable doubt is not required as a basis for judgment on the legality of an employer’s dismissal of an employee, nor even preponderance of evidence for that matter, substantial evidence being sufficient. In the instant case, while there may be no denying that respondent’s medical card had falsified entries in it, SMC was unable to prove, by substantial evidence, that it was respondent who made the unauthorized entries. Besides, SMC’s (Your) Guide on Employee Conduct punishes the act of falsification of company records or documents; it does not punish mere possession of a falsified document.

Respondent cannot feign surprise nor ignorance of the earlier AWOPs he had incurred. He was given a warning for his 2, 4, and 11 January and 26, 28, and 29 April 1997 AWOPs. In the same warning, he was informed that he already had six AWOPs for 1997. He admitted that he was absent on 7 and 8 May 1997. He was also given notices to explain his AWOPs for the period 26 May to 2 June 1997, which he received but refused to acknowledge. It does not take a genius to figure out that as early as June 1997, he had more than nine AWOPs.

In any case, when SMC imposed the penalty of dismissal for the 12th and 13th 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 that 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.

Petition granted

PNB v. Cabansag

Florence Cabansag was hired by the PNB Branch in Singapore and was terminated (even if her good work was commended) allegedly due to cost cutting then because of the need for a Chinese speaking employee. She was not properly notified by her boss and she was not given a chance to be heard. There was no due process.

PNB should have 1) apprised her of her particular act or omission 2) inform her of their decision to dismiss her. 282, 283, 284 valid grounds of dismissal. She did not commit any offenses or omissions

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under 282, the business was not closing (illegally dismissed. “contract of employment is imbued with public interest and cannot insinuate themselves from impact of labor laws”PHILIPPINE NATIONAL BANK, petitioner, vs. FLORENCE O. CABANSAG, respondent.

FACTS In late 1998, [herein Respondent Florence Cabansag] arrived in Singapore as a tourist. She applied for employment, with the Singapore Branch of the Philippine National Bank. At the time, the Singapore PNB Branch was under the helm of Ruben C. Tobias, a lawyer, as General Manager, with the rank of Vice-President of the Bank. She applied for employment as Branch Credit Officer, at a total monthly package of $SG4,500.00, effective upon assumption of duties after approval.

Ruben C. Tobias found her eminently qualified and wrote on October 26, 1998, a letter to the President of the Bank in Manila, recommending the appointment of Florence O. Cabansag, for the position. On December 7, 1998, Ruben C. Tobias wrote a letter to Florence O. Cabansag offering her a temporary appointment, as Credit Officer, at a basic salary of Singapore Dollars 4,500.00, a month and, upon her successful completion of her probation to be determined solely, by the Bank, she may be extended at the discretion of the Bank, a permanent appointment and that her temporary appointment was subject to certain terms and conditions.

Cabansag accepted the position and assumed office. In the meantime, the Philippine Embassy in Singapore processed the employment contract of Florence O. Cabansag and, on March 8, 1999, she was issued by the Philippine Overseas Employment Administration, an ‘Overseas Employment Certificate,’ certifying that she was a bona fide contract worker for Singapore.

Barely three (3) months in office Tobias told Cabansag that her resignation was imperative as a ‘cost-cutting measure’ of the Bank. Tobias, likewise, told Cabansag that the PNB Singapore Branch will be sold or transformed into a remittance office and that, in either way, she had to resign from her employment. She then asked Ruben C. Tobias that she be furnished with a ‘Formal Advice’ from the PNB HeadOffice in Manila. However, Ruben C. Tobias flatly refused.

Florence O. Cabansag did not submit any letter of resignation. On April 16, 1999, Ruben C. Tobias again summoned Florence O. Cabansag to his office and demanded that she submit her letter of resignation, with the pretext that he needed a Chinese-speaking Credit Officer to penetrate the local market, with the information that a Chinese-speaking Credit Officer had already been hired and will be reporting for work soon. She was warned that, unless she submitted her letter of resignation, her employment record will be blemished with the notation ‘DISMISSED’ spread thereon.

Without giving any definitive answer, Florence O. Cabansag asked Ruben C. Tobias that she be given sufficient time to look for another job. Ruben C. Tobias told her that she should be ‘out’ of her employment by May 15, 1999.

However, on April 19, 1999, Ruben C. Tobias again summoned Florence O. Cabansag and adamantly ordered her to submit her letter of resignation. She refused. On April 20, 1999, she received a letter from Ruben C. Tobias terminating her employment with the Bank.

On January 18, 2000, the Labor Arbiter rendered judgment in favor of the Complainant and against the Respondents. PNB appealed the labor arbiter’s Decision to the NLRC. In a Resolution dated June 29, 2001, the Commission affirmed that Decision.

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Petitioner appealed to the Court of Appeals which rendered a decision in favor of Florence Cabansag.

ISSUE Whether or not the arbitration branch of the NLRC in the National Capital Region has jurisdiction over the instant controversy.

HELDThe jurisdiction of labor arbiters and the NLRC is specified in Article 217 of the Labor Code and more specifically, Section 10 of RA 8042 reads in part: “SECTION 10. Money Claims. — Notwithstanding any provision of law to the contrary, the Labor Arbiters of the National Labor Relations Commission (NLRC)shall have the original and exclusive jurisdiction to hear and decide, within ninety (90) calendar days after the filing of the complaint, the claims arising out of an employer-employee relationship or by virtue of any law or contract involving Filipino workers for overseas deployment including claims for actual, moral, exemplary and other forms of damages.

Based on the foregoing provisions, labor arbiters clearly have original and exclusive jurisdiction over claims arising from employer-employee relations, including termination disputes involving all workers, among whom are overseas Filipino workers (OFW). We are not unmindful of the fact that respondent was directly hired, while on a tourist status in Singapore, by the PNB branch in that city state. Prior to employing respondent, petitioner had to obtain an employment pass for her from the Singapore Ministry of Manpower.

Securing the pass was a regulatory requirement pursuant to the immigration regulations of that country.Noteworthy is the fact that respondent likewise applied for and secured an Overseas Employment Certificate from the POEA through the Philippine Embassy in Singapore. The Certificate, issued on March 8, 1999, declared her a bona fide contract worker for Singapore. Under Philippine law, this document authorized her working status in a foreign country and entitled her to all benefits and processes under our statutes. Thus, even assuming arguendo that she was considered at the start of her employment as a “direct hire” governed by and subject to the laws, common practices and customs prevailing in Singapore she subsequently became a contract worker or an OFW who was covered by Philippine labor laws and policies upon certification by the POEA. At the time her employment was illegallyterminated, she already possessed the POEA employment Certificate.

Whether employed locally or overseas, all Filipino workers enjoy the protective mantle of Philippine labor and social legislation, contract stipulations to the contrary notwithstanding. For purposes of venue, workplace shall be understood as the place or locality where the employee is regularly assigned when the cause of action arose. It shall include the place where the employee is supposed to report back after a temporary detail, assignment or travel. In the case of field employees, as well as ambulant or itinerant workers, their workplace is where they are regularly assigned, or where they are supposed to regularly receive their salaries/wages or work instructions from, and report the results of their assignment to their employers.

Under the “Migrant Workers and Overseas Filipinos Act of 1995” (RA 8042), a migrant worker “refers to a person who is to be engaged, is engaged or has been engaged in a remunerated activity in a state of which he or she is not a legal resident; to be used interchangeably with overseas Filipino worker.”[21]Undeniably, respondent was employed by petitioner in its branch office in Singapore. Admittedly, she is a Filipino and not a legal resident of that state. She thus falls within the category of “migrant worker” or “overseas Filipino worker.”

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YUSEN AIR AND SEA SERVICE PHILIPPINES INC. vs VILLAMORFACTS

Petitioner hired respondent Villamor as branch manager in its Cebu Office. Later, petitioner reclassified respondent’s position to that of Division Manager, which position respondent held until his resignation on February 1, 2002. Immediately after his resignation, respondent started working for Aspac International, a corporation engaged in the same line of business as that of petitioner.

Thereafter, petitioner Yusen Air filed against respondent a complaint for injunction and damages with prayer for a temporary restraining order in the RTC of Parañaque City, on the ground that respondent violated the provision in his contract that he should not affiliate himself with competitors for a period of two years from his resignation or separation from petitioner company.

       Respondent also filed against petitioner a case for illegal dismissal before the NLRC. Instead of filing an answer to the case in the RTC, respondent moved for the dismissal of said case, arguing that the RTC has no jurisdiction over the subject matter of said case because an employer-employee relationship is involved.

Petitioner contends that its cause of action did not arise from employer-employee relations even if the claim therein is based on a provision in its handbook.

ISSUE

Whether or not the RTC has jurisdiction over the present controversy.

HELD

The SC held that the RTC has jurisdiction over the case.

Jurisprudence has evolved the rule that claims for damages under paragraph 4 of Article 217, to be cognizable by the Labor Arbiter, must have a reasonable causal connection with any of the claims provided for in that article. Only if there is such a connection with the other claims can a claim for damages be considered as arising from employer-employee relations.

Article 217, as amended  by Section 9 of RA 6715, provides:

Art. 217. Jurisdiction of Labor Arbiters and the Commission. — (a) Except as otherwise provided under this Code, the Labor Arbiters shall have original and exclusive jurisdiction to hear and decide, within thirty (30) calendar days after the submission of the case by the parties for decision without extension, even in the absence of stenographic notes, the following cases involving all workers, whether agricultural or non-agricultural: xxx            xxx           xxx4.            Claims for actual, moral, exemplary and other forms of damages arising from the employer-employee relations;"

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While paragraph 3 above refers to “all money claims of workers,” it is not necessary to suppose that the entire universe of money claims that might be asserted by workers against their employers has been absorbed into the original and exclusive jurisdiction of Labor Arbiters.  In the first place, paragraph 3 should be read not in isolation from but rather within the context formed by paragraph 1 (relating to unfair labor practices), paragraph 2 (relating to claims concerning terms and conditions of employment), paragraph 4 (claims relating to household services, a particular species of employer-employee relations), and paragraph 5 (relating to certain activities prohibited to employees or employers).

It is evident that there is a unifying element which runs through paragraph 1 to 5 and that is, that they all refer to cases or disputes arising out of or in connection with an employer-employee relationship. This is, in other words, a situation where the rule of noscitur a sociis may be usefully invoked in clarifying the scope of paragraph 3, and any other paragraph of Article 217 of the Labor Code, as amended.

We reach the above conclusion from an examination of the terms themselves of Article 217, as last amended by B.P. Blg 227, and even though earlier versions of Article 217 of the Labor Code expressly brought within the jurisdiction of the Labor Arbiters and the NLRC “cases arising from employer-employee relations,” which clause was not expressly carried over, in printer’s ink, in Article 217 as it exists today. For it cannot be presumed that money claims of workers which do not arise out of or in connection with their employer-employee relationship, and which would therefore fall within the general jurisdiction of regular courts of justice, were intended by the legislative authority to be taken away from the jurisdiction of the courts and lodged with Labor Arbiters on an exclusive basis. The Court, therefore, believes and so holds that the “money claims of workers” referred to in paragraph 3 of Article 217 embraces money claims which arise out of or in connection with the employer-employee relationship, or some aspect or incident of such relationship.  Put a little differently, that money claims of workers which now fall within the original and exclusive jurisdiction of Labor Arbiters are those money claims which have some reasonable causal connection with the employer-employee relationship. When, as here, the cause of action is based on a quasi-delict or tort, which has no reasonable causal connection with any of the claims provided for in Article 217, jurisdiction over the action is with the regular courts.

As it is, petitioner does not ask for any relief under the Labor Code. It merely seeks to recover damages based on the parties’ contract of employment as redress for respondent's breach thereof. Such cause of action is within the realm of Civil Law, and jurisdiction over the controversy belongs to the regular courts. More so must this be in the present case, what with the reality that the stipulation refers to the post-employment relations of the parties.

For sure, a plain and cursory reading of the complaint will readily reveal that the subject matter is one of claim for damages arising from a breach of contract, which is within the ambit of the regular court’s jurisdiction.

It is basic that jurisdiction over the subject matter is determined upon the allegations made in the complaint, irrespective of whether or not the plaintiff is entitled to recover upon the claim asserted therein, which is a matter  resolved only after and as a result of

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a trial.  Neither can jurisdiction of a court be made to depend upon the defenses made by a defendant in his answer or motion to dismiss.  If such were the rule, the question of jurisdiction would depend almost entirely upon the defendant. 

The orders of the lower courts are set aside.

Vinoya v. NLRC [G.R. No. 126596, February 2, 2000]

FACTS: Petitioner Vinoya was hired by RFC as sales representative. He avers that he was transferred by RFC to PMCI, an agency which provides RFC with additional contractual workers. In PMCI, he was reassigned to RFC as sales representative and then later informed by the personnel manager of RFC that his services were terminated. RFC maintains that no employer-employee relationship existed between petitioner and itself. Petitioner filed complaint for illegal dismissal. RFC alleges that PMCI is an independent contractor as the latter is a highly capitalized venture.

ISSUE: Whether or not petitioner was an employee of RFC and thereby, illegally dismissed.

HELD: Yes. PMCI was a labor-only contractor. Although the Neri doctrine stated that it was enough that a contractor had substantial capital to show it was an independent contractor, the case of Fuji Xerox clarified the doctrine stating that an independent business must undertake the performance of the contract according to its own manner and method free from the control of the principal. In this case, PMCI did not even have substantial capitalization as only a small amount of its authorized capital stock was actually paid-in. Also, PMCI did not carry on an independent business or undertake the performance of its contract according to its own manner and method. Furthermore, PMCI was not engaged to perform a specific and special job or service, which is one of the strong indicators that is an independent contractor. Lastly, in labor-only contracting, the employees supplied by the contractor perform activities, which are directly related to the main business of its principal. It is clear that in this case, the work of petitioner as sales representative was directly related to the business of RFC. Since due to petitioner’s length of service, he attained the status of regular employee thus cannot be terminated without just or valid cause. RFC failed to prove that his dismissal was for cause and that he was afforded procedural due process. Petitioner is thus entitled to reinstatement plus full backwages from his dismissal up to actual reinstatement.

Neri vs NLRC (1993) 224 SCRA 717

FACTS: Petitioners instituted complaints against FEBTC and BCC to compel the bank to accept them as regular employees and for it to pay the differential between the wages being paid them by BCC and those received by FEBTC employees with similar length of service. They contended that BCC in engaged in labor-only contracting because it failed to adduce evidence purporting to show that it invested in the form of tools, equipment, machineries, work premises and other materials which are necessary in the conduct of its business. Moreover, petitioners argue that they perform duties which are directly related to the principal business or operation of FEBTC.

ISSUE: Whether or not BCC was engaged in labor-only contracting.

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HELD: It is well-settled that there is labor-only contracting where: (a) the person supplying workers to an employer does not have substantial capital or investment in the form of tools, equipment, machineries, work premises, among others; and, (b) the workers recruited and placed by such person are performing activities which are directly related to the principal business of the employer.BCC need not prove that it made investments in the form of tools, equipment, machineries, work premises, among others, because it has established that it has sufficient capitalization. This fact was both determined by the Labor Arbiter and the NLRC as BCC had a capital stock of P1 million fully subscribed and paid for. BCC is therefore a highly capitalized venture and cannot be deemed engaged in labor-only contracting.

While there may be no evidence that it has investment in the form of tools, equipment, machineries, work premises, among others, it is enough that it has substantial capital, as was established before the Labor Arbiter as well as the NLRC. The law does not require both substantial capital and investment in the form of tools, equipment, machineries, etc. This is clear from the use of the conjunction "or" instead of “and”. Having established that it has substantial capital, it was no longer necessary for BCC to further adduce evidence to prove that it does not fall within the purview of "labor-only" contracting. There is even no need for it to refute petitioners' contention that the activities they perform are directly related to the principal business of respondent bank.

On the other hand, the Court has already taken judicial notice of the general practice adopted in several government and private institutions and industries of hiring independent contractors to perform special services. These services range from janitorial, security and even technical or other specific services such as those performed by petitioners Neri and Cabelin. While these services may be considered directly related to the principal business of the employer, nevertheless, they are not necessary in the conduct of the principal business of the employer.

San Miguel vs Maerc Integrated ServicesFACTS: In a decision by the court, it Decision petitioner jointly and severally liable with MAERC for the payment of separation benefits and wage differential of 291 complainants. Petitioner reiterated that no employer- employee relationship exists between it and the complainants. And that MAERC is an independent contractor hence petitioner should not be Decision solidarily liable with it. It disputes this court’s finding that MAERC solely engaged the services of complainants and exercised control over the complainants conduct; that no intervention or influence could have been extended by it in the selection or hiring of complainants or the majority of them had worked to the petitioner before it signed a contract with MAERC.

ISSUE: WON employer- employee relationship exists between the parties.

HELD: Petitioner’s contention must be rejected. While the continuity of service rendered by the workers to petitioner by itself does not signify an employer- employee relationship, it was Decision to be so considering the other circumstances present. More so, since the workers continued to work for petitioner without break from their former employer and then as employees of MAERC even before the latter was incorporated. The record adequately supports the fact that MAERC admitted recruiting workers for petitioner before its incorporation.

Most importantly, petitioner refutes this Court’s conclusion that petitioner exercised control over the workplace. It stresses that checkers assigned to the workplace did not stay there continuously to merit the conclusion that they maintained constant presence as Decision by the court.

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We disagree. While petitioner’s checkers may not have stayed the full eight hours in the workplace because they had to leave for their office to make their reports, their attendance need not be continuous to be considered constant and therefore an indication of control. We find in fact that they maintained sufficient presence at the workplace to be able to pinpoint the workers whose performance was not at par and to report who they are.