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AS TO PROMM-GEM Misconduct as to warrant dismissal: It is not sufficient that
In the instant case, the financial statements of Promm-Gem the act or conduct complained of has violated some established
show it has authorized capital stock of P1M and a paid-in capital rules or policies. It is equally important and required that the
or capital available for operations of P500K. It also has long act or conduct must have been performed with wrongful intent.
terms asserts of P432K and current assets of P719K. Promm-
Gem has also proven that it maintained its own warehouse and IN THIS CASE:Petitioners-employees of Promm-Gem may have
office space with a floor area of 870 sq.m. It also has registered committed an error of judgment in claiming to be employees
vehicles for promo and merchandising business. of P&G, but it cannot be said that they were motivated by any
The court finds that Promm-Gem has substantial wrongful intent in doing so. As such, we find them guilty of only
investments which relates to the work performed. simple misconduct for assailing the integrity of Promm-Gem
as a legitimate and independent promotion firm.
The records also that it supplies its complainant workers with A misconduct which is not serious or grave, as that existing in
the relevant materials such as markers, tapes, liners and the instant case, cannot be a valid basis for dismissing an
cutters, necessary for them to perform their work – even employee.
uniforms. Promm-Gem already considered them as regular The court finds no valid cause for the dismissal of
employees. Which also negates the second requisite. petitioner-employees of Promm-Gem.
Promm-Gemm CANNOT be considered as a labor- THUS THE DISMISSAL WAS ILLEGAL.
only contractor.
It is a legitimate independent contractor. Damages
As for P&G, the records show that it dismissed its employees
AS TO SAPS through SAPS in a manner oppressive to labor. The sudden and
It shows that it has paid-in capital of only P31K and no other peremptory barring of the concerned petitioners from work,
evidence showing how much its working capital and assets are. and from admission to the work place, after just a one-day
Furthermore, there is no showing of substantial investment in verbal notice, and for no valid cause bellows oppression and
tools, equipment or other assets. utter disregard of the right to due process of the concerned
Court ruled that it has NO substantial capital. petitioners. Hence, an award of moral damages is called for.
It has a 6-month contract with P&G
It failed to show that it can complete the period using Decision: The petition is granted. P&G and Promm-Gem are
its own capital and investment. ordered to reinstate their respective employees immediately
Its capital is not even sufficient for 1-month payroll. without loss of seniority rights and with full back wages and
other benefits. Remanded for computation.
Substantial capital – refers to capitalization used in the
performance or completion of the job, work, or service
contracted out.
Termination of Services
In cases of regular employment, employer shall not terminate
the services of employee except for just or authorized cause.
In this case, the termination letters given by Promm-Gem to its
employees uniformly specified the cause of dismissal as grave
misconduct and breach of trust.
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