Latest Supreme Court decisions on employee dismissals

The Supreme Court has promulgated a number of decisions in 2013, where cases of employee dismissals were questioned by either the employers who lost their cases before the Labor Arbiter and the NLRC or workers who lost their jobs for alleged misconduct, insubordination, offenses against the persons of employers, gross negligence and analogous cases. As National President of PMAP (People Managers Association of the Philippines), I am now going around the different major cities in the country giving lectures to practicing lawyers and HR managers who want to know the latest trends in labor jurisprudence. I am also being invited by 12 universities/Law schools to give advanced pre-Bar review for students of Law who aspire to pass this year's Bar Examinations.

This weekend as well as last Saturday and Sunday, this writer lectured in the University of Cebu Bar Review class under the auspices of Law Dean Atty. Baldomero Estenzo, who organized this advanced review classes. Some students coming from other law schools joined us including those coming from Mindanao, Negros and Bohol. The highlight of our discussions involved newly decided cases on termination of employment. Most of the cases were decided in favor of labor and many companies were directed to reinstate illegally dismissed employees to their positions without loss of seniority rights and to pay them full backwages and other reliefs, like attorney's fees and moral damages in some instances. There were others, however, that were won by management in cases that were found without merit.

In one case (GR 171282/183484, 27 Nov 2013), involving a factory in Tondo, the High Court declared that it was illegal on the part of management to have refused to recall workers after six months of suspension of operations due to a fire that gutted the company's establishment. The Court held that it was perfectly valid to suspend operations after the fire but the suspension should not have lasted more than six months. The company's failure to recall the workers after that was tantamount to illegal dismissal. Management should thus pay full backwages to the illegally dismissed workers and to reinstate them. In a case (GR 192394 03 July 2013) involving the PNCC (Philippine National Construction Corp.), a worker who was rehired many times was deemed a regular employee and not a project worker, contrary to the company's allegation. Thus, the management's refusal to rehire him was held an illegal dismissal.

In the case of Norkis Trading vs. M. Genilo (GR 159730) The Supreme Court held that when an employer transfers an employee to a position with a demotion in rank, such transfer is construed as a dismissal. Constructive dismissal is illegal under our prevailing jurisprudence. There are a lot of other cases where management was deemed to have exceeded the bounds of its management prerogatives. They were directed to take back their illegally dismissed workers. The worst part of it all is the payment of backwages which may cover as long as twenty years or more, that would span the entire period from the time the termination was effected up to the actual date of reinstatement. And so, if delays are incurred by the arbiters, the NLRC and the courts, the delay would add more backwages to be shouldered by the employers.

In fairness, however, management also won some cases. The Coca-Cola Co. won a case (GR 199890, 19 August 2013) against a worker who was found guilty of conspiring with others in pilferage of products costing more than P20,000. In the case of Goya Chocolate (GR 170054, 21 Jan 2013), the Court sustained the validity of outsourcing some of the company functions. Management however was told to respect the provisions of the existing collective bargaining agreement. In a case involving illegal strikers (Automotive Engine Rebuilders, GR 160138, 16 Jan 2013), the Supreme Court ruled that workers who stage illegal strikes are not entitled to any relief but a one-day demonstration is just an expression of freedom by the workers. It was not a strike at all. There was no damage caused on the company and the workers were not in bad faith. Thus, it was illegal to dismiss these workers.

In the above case of AER, the High Court also faulted management for errors in the conduct of drug tests among its employees. The use of medical clinics that are not properly accredited by the government would make the drug test non-binding. The results could not be used as evidence against the workers. The leading case of this was the Sulpicio Lines case (GR 172589, 627 SCRA 254). In the case of Sampaguita Transport Corp. (GR 197384, 30 Jan 2013), the Supreme Court held that even if there is a good ground to dismiss an employee, he must be afforded due process, otherwise management would have to pay nominal damages (485 Phil 248). All these and many others constitute the latest pronouncements by the highest court of the land. They are controlling jurisprudence and they should be made basis of future decisions involving the same facts.

The Supreme Court is the final interpreter of the meaning and spirit of the law. All Filipinos, whether employers, workers, professor or students should adhere to these established precedents and jurisprudence. They are integral parts of the law of the land.