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Grand Asian Shipping Lines v.

G.R. No. 178184; January 29, 2014

Petitioner Grand Asian Shipping Lines, Inc (GASLI) is a domestic corporation

engaged in transporting liquified petroleum gas (LPG) from Petrons refinery in Bataan to
Pasig and Cavite while respondents are crewmembers of one of GASLIs vessels, M/T
Dorothy Uno. Some time afterwards, one of the vessels Oilers, Abis (Abis), reported to
GASLIs Office and Crewing Manager, an alleged illegal activity being committed by
respondents aboard the vessel. Abis revealed that after about four to five voyages a
week, a substantial volume of fuel oil is unconsumed and stored in the vessels fuel
tanks. However, Gruta would misdeclare it as consumed fuel in the Engineers Voyage
Reports. Then, the saved fuel oil is siphoned and sold to other vessels out at sea usually
at nighttime. Respondents would then divide among themselves the proceeds of the
sale. Abis added that he was hesitant at first to report respondents illegal activities for
fear for his life. After an audit and investigation, GASLIs internal auditor issued a
Certification of Overstatement of Fuel Oil Consumption for M/T Dorothy stating that fuel
oil consumption was overstated Thus, a criminal complaint for qualified theft was filed
against complainants. It was subsequently filed in court. Throughout, GASLI placed
complainants in preventive suspension. After conducting administrative hearings,
defendants terminated the employment of complainants. Respondents filed with the
NLRC separate complaint for illegal suspension and dismissal, among others, against
petitioner. the Labor Arbiter rendered decision finding the dismissal of 21 complainants
to be illegal. The petitioners then filed an appeal and NLRC ruled for the petitioners.
However, when the case was elevated to the CA, the latter ruled in favor of respondents.

ISSUE: Whether or not the dismissal is illegal.


Yes. In termination disputes, the burden of proving that the dismissal is for a just
or valid cause rests on the employers. Failure on their part to discharge such burden will
render the dismissal illegal. The CA did not commit any error in finding that
respondents were illegally dismissed. According to the termination notice, respondents
were dismissed based on the grounds of (a) serious misconduct (b) engaging in pilferage
wile navigating at sea (c) willful breach of the trust reposed by the company (d)
commission of a crime against their employer. After examination of the evidence, the
court finds that petitioners failed to substantiate the charges of pilferage against
respondents. The quantum of proof that should be presented is substantial evidence.
Mere filing of formal charge does not automatically make dismissal valid. The affidavit
executed simply contained accusations while allegations remained uncorroborated. Also
there is no sufficient evidence to show respondents participation in the commission of
the crime.
Respondents termination due to loss of trust and confidence should have a
distinction between managerial and rank and file employees. Rank-and-file employees
require proof of involvement while managerial employees mere existence of a basis for
belief is sufficient. Given that Galvez and Gruta have managerial positions there is some
basis for the loss of employers confidenceregarding the overstatement of fuel
consumption without any evidence to the contrary. While the others, who are ordinary
rank and file employees, were not proven to have any involvement in the loss of the
vessels fuel. Rendering their dismissals illegal. The employer bears the burden of proof
in illegal dismissal cases thus the employer must first establish by substantial evidence
the fact of dismissal.