Académique Documents
Professionnel Documents
Culture Documents
(J. Bersamin)
Facts: Petitioner Jao contends that the respondent employed him as a comptroller and
was assigned to handle the financial aspect of the respondents business. However, on
one working day, the petitioner was barred from entering the premises of the
respondent due to the reason that there were no employer employee relationship and
the petitioner was not their employee but the employee of one of its creditors assigned
to the respondents corporation to oversee its financial and business operations. Hence,
the petitioner filed a complaint for illegal dismissal.
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Facts: Respondent Rogelio was first employed by Pan Phil. Copra Dealer, the
petitioners predecessor which was owned by a person named Masing Chan. Later on,
Masing Chan changed the name of the corporation and adopted a business name of
Masing and Sons Development Corporation with a different branch manager. In all that
time, respondent worked as a laborer and applied for Social Security System. After
paying contributions to the SSS for more than 10 years, he is now qualified for such
retirement benefits. On March 1997, the respondent was paid his last salary and being a
67-year old worker, he already reached the compulsory retirement age. Unfortunately,
he did not receive any benefits even retirement benefit from the petitioners company
on the reason that the respondent was their former employee, hired on January 1977 to
June 1989 and that the respondent was hired by Lim starting from July 1989 until the
filing of the complaint. Hence, no employer employee relationship existed between
the respondent and the petitioner upon the employment of the respondent to Lim.
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Held: A fixed period in a contract of employment does not by itself signify an intention
to circumvent Article 280 of the Labor Code. The provision contemplates three kinds of
employees, namely: (a) regular employees; (b) project employees; and (c) casuals who
are neither regular nor project employees. The nature of employment of a worker is
determined by the factors provided in Article 280 of the Labor Code, regardless of any
stipulation in the contract to the contrary.
A fixed term agreement, to be valid, must strictly conform with the requirements and
conditions provided in Article 280 of the Labor Code. The test to determine whether a
particular employee is engaged as a project or regular employee is whether or not the
employee is assigned to carry out a specific project or undertaking, the duration or
scope of which was specified at the time of his engagement. There must be a
determination of, or a clear agreement on, the completion or termination of the project
at the time the employee is engaged. Otherwise put, the fixed period of employment
must be knowingly and voluntarily agreed upon by the parties, without any force,
duress or improper pressure being brought to bear upon the employee and absent any
other circumstances vitiating his consent, or it must satisfactorily appear that the
employer and employee dealt with each other on more or less equal terms with no
moral dominance whatsoever being exercised by the former on the latter. For one, it
would be unusual for a company like Innodata to undertake a project that had no
relationship to its usual business. Also, the necessity and desirability of the work
performed by the employees are not the determinants in term employment, but rather
the day certain voluntarily agreed upon by the parties.
In fine, the employment of the petitioners who were engaged as project employees for a
fixed term legally ended upon the expiration of their contract. Their complaint for
illegal dismissal was plainly lacking in merit.
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Facts: Netlink Computer, Inc. Products and Services hired Eric S. Delmo as account
manager. He was able to generate sales from which he earned commissions amounting
to P993,558.89 and US$7,588.30. He then requested payment of his commissions, but
Netlink refused and only gave him partial cash advances chargeable to his
commissions. Later on, Netlink began to nitpick and fault find, like stressing his
supposed absences and tardiness. In order to force him to resign, Netlink issued several
memoranda detailing his supposed infractions of the companys attendance policy.
Despite the memoranda, Delmo continued to generate huge sales for Netlink. On
November 28, 1996, Delmo was shocked when he was refused entry into the company
premises by the security guard pursuant to a memorandum to that effect. This incident
prompted Delmo to file a complaint for illegal dismissal. The Labor Arbiter ruled
against Netlink and in favor of Delmo. On appeal, the National Labor Relations
Commission modified the decision of the Labor Arbiter by setting aside the backwages
and reinstatement decreed by the Labor Arbiter due to the existence of valid and just
causes for the termination of Delmos employment. On May 9, 2003, the CA
promulgated its assailed decision upholding the NLRCs ruling subject to
modifications. Hence, this appeal. Netlink submits that the CA committed a palpable
and reversible error of law in not holding that the applicable exchange rate for
computing the US dollar commissions of Delmo should be the rates prevailing at the
time when the sales were actually generated, not the rates prevailing at the time of the
payment; and in awarding attorneys fees.
Held: In the absence of a written agreement between the employer and the employee
that sales commissions shall be paid in a foreign currency, the latter has the right to be
paid in such foreign currency once the same has become an established practice of the
former. The rate of exchange at the time of payment, not the rate of exchange at the time
of the sales, controls.
There was no written contract between Netlink and Delmo stipulating that the latters
commissions would be paid in US dollars. The absence of the contractual stipulation
notwithstanding, Netlink was still liable to pay Delmo in US dollars because the
practice of paying its sales agents in US dollars for their US dollar denominated sales
had become a company policy. This was impliedly admitted by Netlink when it did not
refute the allegation that the commissions earned by Delmo and its other sales agents
had been paid in US dollars. Instead of denying the allegation, Netlink only sought a
declaration that the US dollar commissions be paid using the exchange rate at the time
of sale. The principle of non-diminution of benefits, which has been incorporated in
Article 100 of the Labor Code, forbade Netlink from unilaterally reducing, diminishing,
discontinuing or eliminating the practice. Verily, the phrase supplements, or other
employee benefits in Article 100 is construed to mean the compensation and privileges
received by an employee aside from regular salaries or wages.
With regard to the length of time the company practice should have been observed to
constitute a voluntary employer practice that cannot be unilaterally reduced,
diminished, discontinued or eliminated by the employer, jurisprudence has not laid
down any rule requiring a specific mmimum number of years.
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Facts: Petitioner granted claims for funeral and bereavement aid as early as 1999, then
issued a memorandum in 2000 to correct its erroneous interpretation of legal dependent
under Section 4, Article XIII of the CBA. This notwithstanding, the 2001-2004 CBA still
contained the same provision granting funeral or bereavement aid in case of the death
of a legal dependent of a regular employee without differentiating the legal dependents
according to the employee's civil status as married or single.
Held: The continuity in the grant of the funeral and bereavement aid to regular
employees for the death of their legal dependents has undoubtedly ripened into a
company policy. With that, the denial of Alfante's qualified claim for such benefit
pursuant to Section 4, Article XIII of the CBA violated the law prohibiting the
diminution of benefits. Pursuant to Article 100 of the Labor Code, petitioner as the
employer could not reduce, diminish, discontinue or eliminate any benefit and
supplement being enjoyed by or granted to its employees.
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Held: The Court ruled that she was entitled to the bonus or special incentive. By its very
definition, bonus is a gratuity or act of liberality of the giver and thus, is not
demandable. However, in this case, petitioners had already exercised the management
prerogative to grant the bonus or special incentive since there was no refusal of her
proposal and the management even bargained with the respondent.
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Facts: The respondent filed a petition for certification election to represent all the
supervisory employees of petitioner. However, the petitioner filed an opposition and
was later denied. Petitioner also filed a petition for the cancellation of the respondent
unions registration as the labor union for failing to submit its annual financial reports
and updated list of members as required by the Labor Code but later denied by the
Department of Labor. The certification election proceeded and the respondent union
obtained the majority vote of the bargaining unit. The petitioner filed a protest insisting
on the illegitimacy of the respondent union.
Held: Basic in the realm of labor union rights is that the certification election is the sole
concern of the workers, and the employer is deemed an intruder as far as the
certification election is concerned. Thus, the petitioner lacked the legal personality to
assail the proceedings for the certification election, and should stand aside as a mere
bystander who could not oppose the petition, or even appeal the Med-Arbiters orders
relative to the conduct of the certification election.
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Facts: Respondent Lepanto Capataz Union, a labor organization duly registered with
DOLE, filed a petition for consent election with the Industrial Relations Division of the
Cordillera Regional Office (CAR) of DOLE, thereby proposing to represent 139
capatazes of Lepanto. Lepanto opposed the petition, contending that the Union was in
reality seeking a certification election, not a consent election, and would be thereby
competing with the Lepanto Employees Union (LEU), the current collective bargaining
agent. Lepanto pointed out that the capatazes were already members of LEU, the
exclusive representative of all rank-and-file employees of its Mine Division. Med-
Arbiter Michaela A. Lontoc of DOLE-CAR issued a ruling to the effect that the
capatazes could form a separate bargaining unit due to their not being rank-and-file
employees. DOLE Undersecretary Rosalinda DimapilisBaldoz (Baldoz), acting by
authority of the DOLE Secretary, affirmed the ruling of Med- Arbiter Lontoc. In the
ensuing certification election, the Union garnered 109 of the 111 total valid votes cast.
On the day of the certification election, however, Lepanto presented an
opposition/protest. Med-Arbiter Florence Marie A. Gacad-Ulep of DOLE-CAR rendered
a decision certifying the Union as the sole and exclusive bargaining agent of all
capatazes of Lepanto.
Held: The DOLE Secretarys subordinates in the DOLE fairly and objectively resolved
whether the Union could lawfully seek to be the exclusive representative of the
bargaining unit of capatazes in the company. Their factual findings, being supported by
substantial evidence, are hereby accorded great respect and finality.
Meanwhile, the Supreme Court ruled that capatazes or foremen are not rank-and-file
employees because they are an extension of the management, and as such they may
influence the rank-and-file workers under them to engage in slowdowns or similar
activities detrimental to the policies, interests or business objectives of the employers.
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Facts: Pentagon hired respondents as chief officer and second engineer, respectively.
When their 10-month contract expired, they were repatriated to the Philippines.
Alleging non-payment and underpayment of wages, and claiming damages and
attorney's fees, they separately brought claims against Pentagon and the owners and
managers of Baleen Marine. The Labor Arbiter ruled in favor of Pentagon, declaring
JDA Inter--Phil jointly and solidarily liable with Baleen Marine. However, the NLRC
reversed the decision of the Labor Arbiter. Upon Pentagon's motion for reconsideration,
the NLRC reversed itself and ruled in favor of Pentagon. The CA reversed the decision
of the NLRC.
Held: Before a transfer of accreditation can be effected, the transferee agency should
likewise have to comply with the requirements for accreditation. The POEA can act on
the transfer of accreditation only after all the requirements shall have been submitted.
In light of the foregoing, there was no effective transfer of agency from Pentagon to JDA
Inter-Phil. Even assuming arguendo that JDA Inter--Phil did not withdraw its
application for accreditation with the POEA, there was still no valid transfer of agency
to speak of in the first place because JDA Inter-Phil did not submit the required
authenticated special power of attorney and manning agreement.
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WALLEM MARITIME SERVICES INC. VS TANAWAN
G.R. No. 160444, 29 August 2012
Seafarers; POEA Standard Employment Contracts
Facts: Tanawan filed in the Arbitration Branch of the NLRC a complaint for disability
benefits for the foot and eye injuries, sickness allowance, damages and attorneys fees
against the petitioner and its foreign principal. The petitioner denied Tanawans claim
for disability benefits for his foot injury, averring that he was already fit to work; that he
did not sustain the alleged eye injury while on board the vessel because no such injury
was reported. The Labor Arbiter found sufficient evidence to support Tanawans claim
for disability benefits. NLRC reversed the Labor Arbiters decision. CA rendered its
assailed decision in favor of Tanawan.
Held: While the seafarers and their employers are governed by their mutual
agreements, the POEA rules and regulations require that the POEA SEC, which
contains the standard terms and conditions of the seafarers employment in foreign
ocean-going vessels, be integrated in every seafarers contract. Under the 1996 POEA
SEC, it was enough to show that the injury or illness was sustained during the term of
the contract. The Court has declared that the unqualified phrase during the term
covered all injuries or illnesses occurring during the lifetime of the contract. As such,
Tanawan must present concrete proof showing that he acquired or contracted the injury
or illness that resulted to his disability during the term of his employment contract.
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Facts: Petitioner was dismissed from the Company after he misrepresented to Tanduay
by lending his company ID to his driver in order to get clearance for the release of
goods to be delivered to the Companys clients. Petitioner then filed a Complaint for
Illegal Dismissal. The Labor Arbiter dismissed the complaint, and ruled that respondent
rightly exercised its prerogative to dismiss petitioner. On appeal, however, the NLRC
reversed the Labor Arbiter.
Held: It is true that an employer is given a wide latitude of discretion in managing its
own affairs. The broad discretion includes the implementation of company rules and
regulations and the imposition of disciplinary measures on its employees. But the
exercise of a management prerogative like this is not limitless, but hemmed in by good
faith and a due consideration of the rights of the worker. The management prerogative
will be upheld for as long as it is not wielded as an implement to circumvent the laws
and oppress labor. Dismissal should only be a last resort, a penalty to be meted only
after all the relevant circumstances have been appreciated and evaluated with the goal
of ensuring that the ground for dismissal was not only serious but true.
Considering that petitioners motive in lending his company ID to his driver was to
benefit the Company as their employer by facilitating the loading of goods for
distribution to the Companys clients, his dismissal was plainly unwarranted.
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Facts: The Union demanded the suspension of the JEP (Job Evaluation Program) which
it labeled as unfair labor practice. Due to the actions of the petitioners, HSBC filed a
complaint for ULP in the Arbitration Branch of the NLRC. The Union conducted a strike
vote on December 19, 1993 after HSBC accorded regular status to Patrick King, the first
person hired under the JEP. The majority of the members of the Union voted in favor of
a strike. Union's officers and members walked out and gathered outside the premises of
HSBC's offices. Union members blocked the entry and exit points of the bank premises,
preventing the bank officers. HSBC filed its complaint to declare the strike illegal. HSBC
issued return-to-work notices to the striking employees. Only 25 employees complied
and returned to work. Due to the continuing concerted actions, HSBC terminated the
individual petitioners.
Held: A strike staged without compliance with the requirements of Article 263 1 of the
Labor Code is illegal, and may cause the termination of the employment of the
participating union officers and members. However, the liability for the illegal strike is
individual, not collective. To warrant the termination of an officer of the labor
organization on that basis, the employer must show that the officer knowingly
participated in the illegal strike. An ordinary striking employee cannot be terminated
based solely on his participation in the illegal strike, for the employer must further
show that the employee committed illegal acts during the strike.
Meanwhile, the rule for employees unlawfully terminated without substantive and
procedural due process is to entitle them to the reliefs provided under Article 279 of the
Labor Code, that is, reinstatement without loss of seniority rights and other privileges
and to his full backwages, inclusive of allowances, and other benefits or their monetary
equivalent computed from the time the compensation was withheld up to the time of
actual reinstatement. However, the award of backwages is subject to the settled policy
that when employees voluntarily go on strike, no backwages during the strike shall be
awarded. As regards reinstatement, the lapse of 22 years since the strike now warrants
the award of separation pay in lieu of reinstatement, the same to be equivalent of one
(1) month for every year of service.
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Held: It is settled that the extension of the employment of a project employee long after
the supposed project has been completed removes the employee from the scope of a
project employee and makes him a regular employee.
Furthermore, it is axiomatic in labor law that the employer who interposes the defense
of voluntary resignation of the employee in an illegal dismissal case must prove by
clear, positive and convincing evidence that the resignation was voluntary; and that the
employer cannot rely on the weakness of the defense of the employee. The requirement
rests on the need to resolve any doubt in favor of the working man.
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Facts: Respondent averred that he had worked as a pianist at the Legend Hotels
restaurant and that the management had notified him that as a cost-cutting measure his
services as a pianist would no longer be required. Respondent filed a complaint for
alleged unfair labor practice, constructive illegal dismissal, and the
underpayment/nonpayment of his premium pay for holidays, separation pay, service
incentive leave pay, and 13th month pay. The Labor Arbiter dismissed the complaint for
lack of merit upon finding that the parties had no employer- employee relationship.
NLRC affirmed the decision of the LA. The CA set aside the decision of the NLRC.
Held: Retrenchment is one of the authorized causes for the dismissal of employees
recognized by the Labor Code. It is a management prerogative resorted to by employers
to avoid or to minimize business losses. In termination cases, the burden of proving that
the dismissal was for a valid or authorized cause rests upon the employer. Here,
petitioner did not submit evidence of the losses to its business operations and the
economic havoc it would thereby imminently sustain. It only claimed that respondents
termination was due to its present business/financial condition.
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Held: In cases of unlawful dismissal, the employer bears the burden of proving that the
termination was for a valid or authorized cause, but before the employer is expected to
discharge its burden of proving that the dismissal was legal, the employee must first
establish by substantial evidence the fact of her dismissal from employment. In this
case, the petitioner proved the overt acts committed by the respondents in abruptly
terminating her employment through the text messages sent by Cuenca to the petitioner
and her husband, as well as the notices distributed to the clients and published in
the Sun Star.
Facts: Petitioner is one of the supervisors of the respondent corporation and was
assigned to a branch with the instruction to hold the keys and supervised two other
salesladies. One Sunday morning, they conducted a cash-count of their sales proceeds
and found out that a large amount of companys earnings were missing. The
petitioners supervisors arrived with a policeman who immediately placed the
petitioner under arrest and brought her to Precinct 9 of the Malate Police Station. Later,
respondent Minex Corporation through one of its supervisors charged the petitioner
with qualified theft and terminated her due to loss of trust and confidence.
Held: To dismiss an employee, the law requires the existence of a just and valid cause
provided under Article 282 of the Labor Code. Thus, the employer may validly dismiss
for loss of trust and confidence an employee who commits an act of fraud prejudicial to
the interest of the employer. Neither a criminal prosecution nor a conviction beyond
reasonable doubt for the crime is a requisite for the validity of the dismissal.
Nonetheless, the dismissal for a just or lawful cause must still be made upon
compliance with the requirements of due process under the Labor Code; otherwise, the
employer is liable to pay nominal damages as indemnity to the dismissed employee.
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Facts: Northwest Airlines, Inc. employed respondent Del Rosario on as one of its
Manila-based flight attendants. During the boarding preparations, Gamboa, another
flight attendant assigned at the First Class Section of Flight NW 26, needed to borrow a
wine bottle opener from her fellow attendants, Vivien Francisco, Gamboas runner,
went to the Business Class Section to borrow a wine bottle opener from Del Rosario, but
the latter remarked that any flight attendant who could not bring a wine bottle opener
had no business working in the First Class Section. Apparently, Gamboa overheard Del
Rosarios remarks, and later on verbally confronted her. Their confrontation escalated
into a heated argument. Escao intervened but the two ignored her, prompting her to
rush outside the aircraft to get Maria Rosario D. Morales, the Assistant Base Manager, to
pacify them. Northwest dismissed Del Rosario on the grounds of serious misconduct
and wilful disobedience.
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Facts: The petitioner started his employment with respondent Ateneo de Naga
University (University) in the first semester of school year 1960-1961. At the time of his
dismissal, he was a regular and full-time faculty member of the Universitys
Accountancy Department in the College of Commerce. Allegedly, he received a letter
from the University President, informing him that his contract (which was set to expire
on May 31, 2000) would no longer be renewed. After several attempts to discuss the
matter with Fr. Tabora in person, and not having been given any teaching load or other
assignments, he brought his complaint for illegal dismissal. Labor Arbiter Quiones
ruled in favor of the petitioner. In his order dated October 10, 2002, LA Quiones
directed respondents to exercise their option of whether complainant is to be actually
reinstated, or be reinstated in the payroll within ten (10) days from receipt of this order.
Meanwhile, the NLRC affirmed the ruling of the LA that there is illegal dismissal.
Held: The employer is obliged to reinstate and to pay the wages of the dismissed
employee during the period of appeal until its reversal by the higher Court; and that
because he was not reinstated either actually or by payroll, he should be held entitled to
the accrued salaries. Hence, petitioner is entitled for accrued salaries from the time of
the issuance of the order of reinstatement by LA Quinones until such order was
reversed.
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Facts: After his dismissal by Matling as its Vice President for Finance and
Administration, the Coros filed on August 10, 2000 a complaint for illegal suspension
and illegal dismissal against Matling and some of its corporate officers (petitioners) in
the NLRC, Sub-Regional Arbitration Branch XII, Iligan City. Matling moved to dismiss
the complaint, raising the ground, among others, that the complaint pertained to the
jurisdiction of the Securities and Exchange Commission (SEC) due to the controversy
being intra-corporate inasmuch as Coros was a member of Matlings Board of Directors
aside from being its Vice-President for Finance and Administration prior to his
termination.
The NLRC and the CA set aside the dismissal, concluding that Coros complaint for
illegal dismissal was properly cognizable by the LA, not by the SEC, because he was not
a corporate officer by virtue of his position in Matling, albeit high ranking and
managerial, not being among the positions listed in Matlings Constitution and By-Laws.
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Facts: MJCI had employed Trajano as a selling teller of betting tickets since November
1989. On April 25, 1998, she reported for work. At around 7:15 p.m., two regular bettors
gave her their respective lists of bets (rota) and money for the bets for Race 14.
Although the bettors suddenly left her, she entered their bets in the selling machine and
segregated the tickets for pick up by the two bettors upon their return. Before closing
time, one of the bettors (requesting bettor) returned and asked her to cancel one of his
bets worth P2,000.00. Since she was also operating the negative machine on that day,
she obliged and immediately cancelled the bet as requested. She gave the remaining
tickets and the P2,000.00 to the requesting bettor, the money pertaining to the canceled
bet. When Race 14 was completed, she counted the bets received and the sold tickets.
She found that the bets and the tickets balanced. But then she saw in her drawer the
receipt for the canceled ticket, but the canceled ticket was not inside the drawer.
Thinking she could have given the canceled ticket to the requesting bettor, she
immediately looked for him but could not find him. It was only then that she
remembered that there were two bettors who had earlier left their bets with her. Thus,
she went to look for the other bettor (second bettor) to ask if the canceled ticket was
with him. When she located the second bettor, she showed him the receipt of the
canceled ticket to counter-check the serial number with his tickets. Thereafter, the
second bettor returned to Trajano and told her that it was one of his bets that had been
canceled, instead of that of the requesting bettor. To complicate things, it was also the
same bet that had won Race 14. Considering that the bet was for a daily double, the
second bettor only needed to win Race 15 in order to claim dividends. At that point, she
realized her mistake, and explained to the second bettor that the cancellation of his
ticket had not been intentional, but the result of an honest mistake on her part. She
offered to personally pay the dividends should the second bettor win Race 15, which
the latter accepted. When Race 15 was completed, the second bettor lost. She was thus
relieved of the obligation to pay any winnings to the second bettor. She was placed
under preventive suspension effective April 28, 1998, for an unstated period of time.
Trajano instituted a complaint for illegal dismissal.
Held: Loss of the employers trust and confidence is a just cause under Article 282 (c), a
provision that ideally applies only to cases involving an employee occupying a position
of trust and confidence, or to a situation where the employee has been routinely
charged with the care and custody of the employers money or property. But the loss of
trust and confidence, to be a valid ground for dismissal, must be based on a willful
breach of trust and confidence founded on clearly established facts. Moreover, the loss
of trust and confidence must be related to the employees performance of duties. As a
selling teller, Trajano held a position of trust and confidence. The nature of her
employment required her to handle and keep in custody the tickets issued and the bets
made in her assigned selling station. The bets were funds belonging to her employer.
Although the act complained of the unauthorized cancellation of the ticket (i.e.,
unauthorized because it was done without the consent of the bettor) was related to
her work as a selling teller, MJCI did not establish that the cancellation of the ticket was
intentional, knowing and purposeful on her part in order for her to have breached the
trust and confidence reposed in her by MJCI, instead of being only out of an honest
mistake.
A review of the records warrants a finding that MJCI did not comply with the
prescribed procedure for dismissal. As for the last procedural requirement of giving the
second notice, the posting of the notice of termination at MJCIs selling stations did not
satisfy it, and the fact that Trajano was eventually notified of her dismissal did not cure
the infirmity. Thus, Trajano is entitled to reinstatement without loss of seniority rights
and other privileges, and to full backwages, inclusive of allowances and other benefits
or their monetary equivalent. However, considering that more than 14 years have
already passed since Trajano initiated her complaint for illegal dismissal in 1998, her
reinstatement is no longer feasible. Consequently, an award of separation pay has
become the practical alternative, computed at one month pay for every year of service.
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Facts: Radio Mindanao Network, Inc. (RMN) hired Michael Maximo R. Amurao III
(Amurao) as a radio broadcaster for its DWKC-FM station and production manager for
its metropolitan radio operations. To meet the demand of the broadcasting industry,
RMN decided to reformat and restructure the programming of its DWKC-FM station.
Amurao and other personnel were advised that their employment would necessarily be
affected because of the reformatting. RMN furnished Amurao a letter informing the
latter that his services are deemed terminated and he is entitled to a settlement pay of
P311,922.00. Amurao accepted the offer of RMN and executed an affidavit of
release/quitclaim containing declarations that he has no more claims, right or action of
whatever nature against RMN, that the latter is released and discharged from any and
all claims and demands that maybe due to him and that he read and understood the
terms of his release and quitclaim and consented to such. After 5 months from the
execution of the quitclaim, Amurao filed a complaint against RMN for illegal dismissal
with money claims before the NLRC. Both the Labor Arbiter and NLRC held that the
quitclaim is void for it was not voluntarily executed. The Court of Appeals affirmed
their decision.
Held: The requisites for the validity of Michaels quitclaim were satisfied. Amurao
acknowledged in his quitclaim that he had read and thoroughly understood the terms
of his quitclaim and signed it of his own volition. The settlement pay of P311,922.00 was
credible and reasonable considering that Michael did not even assail such amount as
unconscionably low, or even state that he was entitled to a higher amount. Amurao was
required to sign the quitclaim as a condition to the release of the settlement pay did not
prove that its execution was coerced. Having agreed to part with a substantial amount
of money, RMN took steps to protect its interest and obtain its release from all
obligations once it paid Michael his settlement pay, which it did in this case.
Not all quitclaims are per se invalid or against public policy. Where the party has
voluntarily made the waiver, with a full understanding of its terms as well as its
consequences, and the consideration for the quitclaim is credible and reasonable, the
transaction must be recognized as a valid and binding undertaking, and may not later
be disowned simply because of a change of mind.
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