G.R. No.

194884

October 22, 2014

IMASEN PHILIPPINE MANUFACTURING CORPORATION, Petitioner,

vs.
RAMONCHITO T. ALCON and JOANN S. PAPA, Respondents.
Accordingly, except as limited by special law, an employer is free to regulate, according to
his own judgment and discretion, all aspects of employment, including hiring, work
assignments, working methods, time, place and manner of work, tools to beused, processes
to be followed, supervision of workers, working regulations, transfer of employees, worker
supervision, layoff of workers and the discipline, dismissal and recall of workers. As a
general proposition, an employer has free reign over every aspect of its business, including
the dismissal of his employees as long as the exercise of its management prerogativeis done
reasonably, in good faith, and in a manner not otherwise intended to defeat or circumvent the
rights of workers.
25

In these lights, the Courts task inthe present petition is to balance the conflicting rights of the
respondents to security of tenure, on one hand, and of Imasen to dismiss erring employees
pursuant to the legitimate exercise of its management prerogative, on the other.
San Miguel Brewery Sales Force Union (PTGWO) v. Hon. Ople, 252 Phil. 27, 30 (1989);
Autobus Workers Union v. NLRC, 353 Phil. 419, 429 (1998).

Article 282 reads: ART. 282. TERMINATION BY EMPLOYER

An employer may terminate an employment for any of the following causes:
(a) Serious misconduct or willful disobedience by the employee of the lawful orders
of his employer or representative in connection with his work;
(b) Gross and habitual neglect by the employee of his duties;
(c) Fraud or willful breach by the employee of the trust reposed in him by his
employer or duly authorized representative;
(d) Commission of a crime or offense bythe employee against the person of his
employer or any immediate member of his family or his duly authorized
representative;
(e) Other causes analogous to the foregoing. [Emphasis ours]
The just causes for dismissing an employee are provided under Article 282 (now Article
296) of the Labor Code.
26

27

Certainly, a dishonest employee cannot be rewarded with separation pay or any financial
benefit after his culpability is established in two decisions by competent labor tribunals,
which decisions appear to be well-supported by evidence. To hold otherwise, even in the
name of compassion, would be to send a wrong signal not only that "crime pays" but also
that one can enrich himself at the expense of another in the name of social justice. And
courts as well as quasi-judicial entities will be overrun by petitioners mouthing dubious pleas
for misplaced social justice. Indeed, before there can be an occasion for compassion and
mercy, there must first be justice for all. Otherwise, employees will be encouraged to steal
and misappropriate in the expectation that eventually, in the name of social justice and
compassion, they will not be penalized but instead financially rewarded. Verily, a contrary
holding will merely encourage lawlessness, dishonesty, and duplicity. These are not the
values that society cherishes; these are the habits that it abhors. 31 San Miguel Corporation v.
National Labor Relations Commission, 325 Phil. 940, 952 (1996).
The fact that private respondent served petitioner for more than twenty years with no
negative record prior to his dismissal, in our view of this case, does not call for such award of
benefits, since his violation reflects a regrettable lack of loyalty and worse, betrayal of the

company. If an employees length of service is to be regarded as justification for moderating

the penalty of dismissal, such gesture will actually become a prize for disloyalty, distorting
the meaning of social justice and undermining the efforts of labor to clean its ranks of
undesirables.

Indeed, length of service and a previously clean employment record cannot simply erase the
gravity of the betrayal exhibited by a malfeasant employee. 29 Length of service is not a
bargaining chip that can simply be stacked against the employer. After all, an employeremployee relationship is symbiotic where both parties benefit from mutual loyalty and
dedicated service. If an employer had treated his employee well, has accorded him fairness
and adequate compensation as determined by law, it is only fair to expect a long-time
employee to return such fairness with at least some respect and honesty. Thus, it may be
said that betrayal by a long-time employee is more insulting and odious for a fair employer.
As stated in another case:
x x x The fact that [the employer] did not suffer pecuniary damage will not obliterate
respondents betrayal of trust and confidence reposed by petitioner. Neither would his length
of service justify his dishonesty or mitigate his liability. His length of service even aggravates
his offense. He should have been more loyal to petitioner company from which he derived
his family bread and butter for seventeen years.30
While we sympathize with Capors plight, being of retirement age and having served
petitioners for 39 years, we cannot award any financial assistance in her favor because it is
not only against the law but also a retrogressive public policy. We have already explained the
folly of granting financial assistance in the guise of compassion in the following
pronouncements:

Dishonesty is defined as the concealment or distortion of

truth in a matter of fact relevant to ones office or connected
with the performance of his duty.[30] It implies a disposition to
lie, cheat, deceive, or defraud; untrustworthiness; lack of
integrity; lack of honesty, probity, or integrity in principle;
and lack of fairness and straightforwardness. [31] Concerned Citizen
v. Gabral, Jr., 514 Phil. 209, 219 (2005).

We cannot simply tolerate injustice to employers if only to protect the

welfare of undeserving employees. As aptly put by then Associate Justice
Leonardo A. Quisumbing:

Needless to say, so irresponsible an employee like petitioner does

not deserve a place in the workplace, and it is within the managements
prerogative xxx to terminate his employment. Even as the law is solicitous
of the welfare of employees, it must also protect the rights of an employer
to exercise what are clearly management prerogatives. As long as the
companys exercise of those rights and prerogative is in good faith to
advance its interest and not for the purpose of defeating or circumventing
the rights of employees under the laws or valid agreements, such exercise
will be upheld.
52

And, in the words of then Associate Justice Ma. Alicia Austria-Martinez

in Philippine Long Distance and Telephone Company, Inc. v. Balbastro:
53

While it is true that compassion and human consideration should

guide the disposition of cases involving termination of employment since it
affects one's source or means of livelihood, it should not be overlooked that
the benefits accorded to labor do not include compelling an employer to
retain the services of an employee who has been shown to be a gross
liability to the employer. The law in protecting the rights of the employees
authorizes neither oppression nor self-destruction of the employer. It
should be made clear that when the law tilts the scale of justice in favor of
labor, it is but a recognition of the inherent economic inequality between
labor and management. The intent is to balance the scale of justice; to put
the two parties on relatively equal positions. There may be cases where the
circumstances warrant favoring labor over the interests of management but
never should the scale be so tilted if the result is an injustice to the
employer. Justitia nemini neganda est (Justice is to be denied to none).
Law and jurisprudence have long recognized the right of
employers to dismiss employees by reason of loss of trust and
confidence. More so, in the case of supervisors or personnel occupying
positions of responsibility, loss of trust justifies termination. Loss of
confidence as a just cause for termination of employment is premised from
the fact that an employee concerned holds a position of trust and
confidence. This situation holds where a person is entrusted with
confidence on delicate matters, such as the custody, handling, or care and
protection of the employers property. But, in order to constitute a just
cause for dismissal, the act complained of must be work-related such as
would show the employee concerned to be unfit to continue working for
the employer.[9]
54

55

In the instant case, respondent Gacayan was the Senior Financial Accountant
of petitioner company. While respondent Gacayan denies that she is
handling or has custody of petitioners funds, a re-examination of the records
of this case reveals that she indeed handled delicate and confidential matters
in the financial analyses and evaluations of the action plans and strategies of
petitioner company. Respondent Gacayan was also privy to the strategic and
operational decision-making of petitioner company, a sensitive and delicate
position requiring the latters utmost trust and confidence. As such, she
should be considered as holding a position of responsibility or of trust and
confidence.
There are two classes of positions of trust: managerial employees and
fiduciary rank-and-file employees.
Managerial employees are defined as those vested with the powers or
prerogatives to lay down management policies and to hire, transfer, suspend,
lay-off, recall, discharge, assign or discipline employees or effectively
recommend such managerial actions.[31] They refer to those whose primary

duty consists of the management of the establishment in which they are

employed or of a department or a subdivision thereof, and to other officers
or members of the managerial staff. [32] Officers and members of the
managerial staff perform work directly related to management policies of
their employer and customarily and regularly exercise discretion and
independent judgment.[33]
The second class or fiduciary rank-and-file employees consist of cashiers,
auditors, property custodians, etc., or those who, in the normal exercise of
their functions, regularly handle significant amounts of money or property.
[34]
These employees, though rank-and-file, are routinely charged with the
care and custody of the employers money or property, and are thus classified
as occupying positions of trust and confidence.
In the case at bar, respondent was employed as the Administration Manager
and the Executive Assistant to the General Manager. The responsibilities of
the Administration Manager include: