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NDC TAGUM FOUNDATION INC V SUMAKOTE
RESPONDENT Evelyn B. Sumakote was a full-time nursing instructor at the
petitioner College of Nursing of the NDC Tagum Foundation before her
appointment as its dean in 1996.
Beginning 1999, she also operated a nursing review and caregiver training center
while working for the petitioner. While still under contract with the petitioners,
the University of Mindanao (UM) engaged respondent’s services as consultant
for the establishment of UM’s Nursing Department. In February 2003, she was
interviewed for deanship and her appointment as full-time program head was
approved by its president.
In a letter dated Feb. 11, 2003, petitioner Natavio advised responden that her
engagement with the UM was in conflict with the interest of the NDC Tagum
Foundation, and that it was an act of disloyalty. She was requested to formally
declare her plan to leave the NDC Tagum Foundation, so it could appoint a new
dean. Respondent did not respond to the letter. In April 2003, she declined the
appointment at the UM, as she had decided to stay with the petitioner
foundation.
On Sept. 4, 2003, respondent received another letter from Natavio requiring her
to explain why she should not be dismissed on the ground of neglect of duty
because of her moonlighting activities. On the following day, respondent
submitted a written explanation denying the charges. She contended that she
had not received any compensation from the UM.
On Sept. 15, 2003, petitioners placed respondent on preventive suspension for
five days pending the outcome of the investigation on her moonlighting activities
and her reported attempts to pirate some of the school instructors for transfer
to the UM. She was directed to explain why she should not be dismissed. The
next day, respondent submitted a letter denying the latest allegation and seeking
a clarification of her employment status. She also prayed that the management
decision be made only after a proper investigation. In a letter dated Sept. 17,
2003, petitioners notified her of her dismissal from employment effective Sept.
18, 2003.
Issue: Was respondent denied due process before dismissal?
Ruling: Yes.
The first letter sent by petitioners did not ask respondent to submit an
explanation. It appears, rather, that they had already decided to find a
replacement for her and that they were only waiting for the confirmation of her
transfer to the UM:
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“In this connection, we feel that it would be best if you would just concentrate
working with the University of Mindanao full-time. And we shall highly appreciate
it if you can formally advise us of your plans to separate from us so that we will
assign somebody in[sic] your position as dean of the College of Nursing.
May we hear from you in writing within three (3) days from your receipt of this
letter so we can also prepare as what we have to do for the good of school [sic].”
It is settled that a full adversarial hearing or conference is not required. All that
is required is a fair and reasonable opportunity for the employee to explain the
controversy at hand. Yet, even if we consider the letter dated Sept. 4, 2003 as
the first notice, there would still be a breach of the procedural due process
requirement.
The breach occurred when petitioners did not call a hearing or conference during
which respondent could have presented her defense. Instead, they placed her
right away under preventive suspension for five days. Then they dismissed her
from employment while she was still serving her preventive suspension.
Clearly, the alleged opportunities given for her to explain her side, through the
letters dated Sept. 4 and Sept. 15, 2003, fell short of the minimum standard of
what constitutes an opportunity to be heard in administrative proceedings, i.e.,
a fair and reasonable chance to defend oneself against the bases cited for one’s
dismissal. (Sereno, CJ:, SC First Division, NDC Tagum Foundation Inc., et. al. vs.
Evelyn B. Sumakote, G.R. No. 190644, June 13, 2016).
OLYMPIA HOUSING INC V LAPASTORA
Facts: A complaint for illegal dismissal, payment of backwages and other benefits,
and regularization of employment filed by Allan Lapastora (Lapastora) and Irene
Ubalubao (Ubalubao) against Olympic Housing, Inc. (OHI), the entity engaged in
the management of the Olympia Executive Residences (OER), a condominium
hotel building situated in Makati City. Lapastora and Ubalubao alleged that they
worked as room attendants of OHI from March 1995 and June 1997, respectively,
until they were placed on floating status on February 24, 2000, through a
memorandum sent by Fast Manpower.
To establish employer-employee relationship with OHI, Lapastora and Ubalubao
alleged that they were directly hired by the company and received salaries
directly from it. They also claimed that OHI exercised control over them as they
were issued time cards, disciplinary action reports and checklists of room
assignments. It was also OHI which terminated their employment after they
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petitioned for regularization. Prior to their dismissal, they were subjected to
investigations for their alleged involvement in the theft of personal items and
cash belonging to hotel guests and were summarily dismissed by OHI despite lack
of evidence.
For their part, OHI and Limcaoco alleged that Lapastora and Ubalubao were not
employees of the company but of Fast Manpower, an independent contractor
with which it had a contract of services, particularly, for the provision of room
attendants.
Reinforcing OHI's claims, Fast Manpower reiterated that it is a legitimate
manpower agency and that it had a valid contract of services with OHI, pursuant
to which Lapastora and Ubalubao were deployed as room attendants. Lapastora
and Ubalubao were, however, found to have violated house rules and regulations
and were reprimanded accordingly. It denied the employees' claim that they
were dismissed and maintained they were only placed on floating status for lack
of available work assignments.
During the pendency of the case, Ubalubao, on her own behalf, filed a Motion to
Dismiss/Withdraw Complaint and Waiver.
Issue: Whether or not Lapastora was illegally dismissed.
Ruling: The court ruled in the affirmative.
Indisputably, Lapastora was a regular employee of OHI. As found by the LA, he
has been under the continuous employ of OHI since March 3, 1995 until he was
placed on floating status in February 2000. His uninterrupted employment by
OHI, lasting for more than a year, manifests the continuing need and desirability
of his services, which characterize regular employment.
By the nature of its petitioner’s business, it is necessary that it maintains a pool
of housekeeping staff to ensure that the premises remain an uncluttered place
of comfort for the occupants. It is no wonder why Lapastora, among several
others, was continuously employed by OHI precisely because of the
indispensability of their services to its business.
The argument that formal notices of investigation were not complied with since
he was not an employee of OHI but of Fast Manpower does not hold
because Lapastora was under the effective control and supervision of OHI
through the company supervisor. She gave credence to the pertinent records of
Lapastora's employment, i.e., timecards, medical records and medical
examinations, which all indicated OHI as his employer. That there is an existing
contract of services between OHI and Fast Manpower where both parties
acknowledged the latter as the employer of the housekeeping staff, including
Lapastora, did not alter established facts proving the contrary.
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To justify fully the dismissal of a regular employee, the employer must, as a rule,
prove that the dismissal was for a just cause and that the employee was afforded
due process prior to dismissal. As a complementary principle, the employer has
the burden of proving with clear, accurate, consistent, and convincing evidence
the validity of the dismissal.
It appears that OHI failed to prove that Lapastora's dismissal was grounded on a
just or authorized cause. While it claims that it had called Lapastora's attention
several times for his infractions, it does not appear from the records that the
latter had been notified of the company's dissatisfaction over his performance
and that he was not given an opportunity to explain. In the same manner,
allegations regarding Lapastora's involvement in the theft of personal items and
cash belonging to hotel guests remained unfounded suspicions as they were not
proven despite OHI's probe into the incidents.
In the present case, Lapastora was not informed of the charges against him and
was denied the opportunity to disprove the same. He was summarily terminated
from employment.
KING OF KINGS V MAMAC
FACTS: Petitioner KKTI is a corporation engaged in public transportation and
managed by Claire Dela Fuente and Melissa Lim. Respondent was a conductor for
Don Mariano Transit Corporation (DMTC). He was one of the few people who
established Damayan ng mga Manggagawa, Tsuper at Conductor-Transport
Workers Union. Pending the union’s certification election, respondent was
transferred to KKTI. The KKTI employees later organized the Kaisahan ng mga
Kawani sa King of Kings (KKKK) which was registered with DOLE. Respondent was
elected KKKK president.
Upon audit of the October 28, 2001 Conductor’s Report of respondent, KKTI
noted an irregularity. It discovered that respondent declared several sold tickets
as returned tickets causing KKTI to lose an income of eight hundred and ninety
pesos. While no irregularity report was prepared on the October 28, 2001
incident, KKTI nevertheless asked respondent to explain the discrepancy. In his
letter, respondent said that the erroneous declaration in his October 28, 2001
Trip Report was unintentional. He explained that during that day’s trip, the
windshield of the bus assigned to them was smashed; and they had to cut short
the trip in order to immediately report the matter to the police. As a result of the
incident, he got confused in making the trip report.
On November 26, 2001, respondent received a letter terminating his
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employment effective November 29, 2001. The dismissal letter alleged that the
October 28, 2001 irregularity was an act of fraud against the company. KKTI also
cited as basis for respondent’s dismissal the other offenses he allegedly
committed since 1999.
After that, he filed an action for illegal dismissal, among other claims. He denied
committing any infraction and alleged that his dismissal was intended to bust
union activities. Moreover, he claimed that his dismissal was effected without
due process.
KKTI averred that it had observed due process in dismissing respondent and
maintained that respondent was not entitled to his money claims such as service
incentive leave and 13th-month pay because he was paid on commission or
percentage basis.
LABOR ARBITER: he was validly dismissed
NLRC: Affirmed. CA held that there was just cause for respondent’s dismissal. It
ruled that respondent’s act in “declaring sold tickets as returned tickets x x x
constituted fraud or acts of dishonesty justifying his dismissal.”
ISSUE: WON respondent was given due process (procedural)
HELD: NO. There was failure to observe the requirements of due process
Due process under the Labor Code involves two aspects: first, substantive––the
valid and authorized causes of termination of employment under the Labor Code;
and second, procedural––the manner of dismissal.
Section 2(d) of Rule I of Book VI of the Omnibus Rules Implementing the Labor
Code provides:
SEC. 2. Standards of due process; requirements of notice.––In all cases of
termination of employment, the following standards of due process shall be
substantially observed:
1 For termination of employment based on just causes as defined in Article 282
of the Code:
(a) A written notice served on the employee specifying the ground or grounds for
termination, and giving said employee reasonable opportunity within which to
explain his side.
(b) A hearing or conference during which the employee concerned, with the
assistance of counsel if he so desires is given opportunity to respond to the
charge, present his evidence, or rebut the evidence presented against him.
(c) A written notice of termination served on the employee, indicating that upon
due consideration of all the circumstances, grounds have been established to
justify his termination.
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1 The first written notice to be served on the employees should contain the
specific causes or grounds for termination against them, and a directive
that the employees are given the opportunity to submit their written
explanation within a reasonable period. “Reasonable opportunity”
under the Omnibus Rules means every kind of assistance that
management must accord to the employees to enable them to prepare
adequately for their defense.15 This should be construed as a period of
at least five (5) calendar days from receipt of the notice to give the
employees an opportunity to study the accusation against them, consult
a union official or lawyer, gather data and evidence, and decide on the
defenses they will raise against the complaint. Moreover, in order to
enable the employees to intelligently prepare their explanation and
defenses, the notice should contain a detailed narration of the facts and
circumstances that will serve as basis for the charge against the
employees. A general description of the charge will not suffice. Lastly,
the notice should specifically mention which company rules, if any, are
violated and/or which among the grounds under Art. 282 is being
charged against the employees.
2 After serving the first notice, the employers should schedule and conduct a
hearing or conference wherein the employees will be given the
opportunity to: (1) explain and clarify their defenses to the charge
against them; (2) present evidence in support of their defenses; and (3)
rebut the evidence presented against them by the management. During
the hearing or conference, the employees are given the chance to
defend themselves personally, with the assistance of a representative or
counsel of their choice. Moreover, this conference or hearing could be
used by the parties as an opportunity to come to an amicable
settlement.
3 After determining that termination of employment is justified, the employers
shall serve the employees a written notice of termination indicating that:
(1) all circumstances involving the charge against the employees have
been considered; and (2) grounds have been established to justify the
severance of their employment.
Respondent was not issued a written notice charging him of committing an
infraction. A verbal appraisal of the charges against an employee does not comply
with the first notice requirement.
The court observed from the irregularity reports against respondent for his other
offenses that such contained merely a general description of the charges against
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him. The reports did not even state a company rule or policy that the employee
had allegedly violated.
No hearing was conducted. Regardless of respondent’s written explanation, a
hearing was still necessary in order for him to clarify and present evidence in
support of his defense. Moreover, respondent made the letter merely to explain
the circumstances relating to the irregularity in his October 28, 2001 Conductor’s
Trip Report. He was unaware that a dismissal proceeding was already being
effected. Thus, he was surprised to receive the November 26, 2001 termination
letter indicating as grounds, not only his October 28, 2001 infraction, but also his
previous infractions.
AGABON V NLRC
Facts:
Private respondent Riviera Home Improvements, Inc. is engaged in the business
of selling and installing ornamental and construction materials. It employed
petitioners Virgilio Agabon and Jenny Agabon as gypsum board and cornice
installers on January 2, 1992[2] until February 23, 1999 when they were
dismissed for abandonment of work.
Petitioners then filed a complaint for illegal dismissal and payment of money
claimS and on December 28, 1999, the Labor Arbiter rendered a decision
declaring the dismissals illegal and ordered private respondent to pay the
monetary claims.
On appeal, the NLRC reversed the Labor Arbiter because it found that the
petitioners had abandoned their work, and were not entitled to backwages and
separation pay.
Upon denial of their motion for reconsideration, petitioners filed a petition for
certiorari with the Court of Appeals.
The Court of Appeals in turn ruled that the dismissal of the petitioners was not
illegal because they had abandoned their employment but ordered the payment
of money claims.
Petitioners also claim that private respondent did not comply with the twin
requirements of notice and hearing.
Private respondent, on the other hand, maintained that petitioners were not
dismissed but had abandoned their work.
Issues: whether petitioners were illegally dismissed.
Ruling: To dismiss an employee, the law requires not only the existence of a just
and valid cause but also enjoins the employer to give the employee the
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opportunity to be heard and to defend himself.
Abandonment is the deliberate and unjustified refusal of an employee to resume
his employment.[14] It is a form of neglect of duty, hence, a just cause for
termination of employment by the employer.[15] For a valid finding... of
abandonment, these two factors should be present: (1) the failure to report for
work or absence without valid or justifiable reason; and (2) a clear intention to
sever employer-employee relationship, with the second as the more
determinative factor which is manifested by... overt acts from which it may be
deduced that the employees has no more intention to work. The intent to
discontinue the employment must be shown by clear proof that it was deliberate
and unjustified.
an employee who deliberately absented from work without leave or permission
from his employer, for the purpose of looking for a job elsewhere, is considered
to have abandoned his job.
The dismissal should be upheld because it was established that the petitioners
abandoned their jobs to work for another company. Private respondent,
however, did not follow the notice requirements and instead... argued that
sending notices to the last known addresses would have been useless because
they did not reside there anymore. Unfortunately for the private respondent,
this is not a valid excuse because the law mandates the twin notice requirements
to the employee's last... known address.[21] Thus, it should be held liable for
non-compliance with the procedural requirements of due process.
that in cases involving dismissals for cause but without observance of the twin
requirements of notice and hearing, the better rule is to abandon the
Serrano doctrine and to follow Wenphil by holding that the dismissal was for just
cause but imposing sanctions on the employer. Such sanctions, however, must
be stiffer than that imposed in Wenphil.
Where the dismissal is for a just cause, as in the instant case, the lack of statutory
due process should not nullify the dismissal, or render it illegal, or
ineffectual. However, the employer should indemnify the employee for the
violation of his statutory rights
Under the Civil Code, nominal damages is adjudicated in order that a right of the
plaintiff, which has been violated or invaded by the defendant, may be vindicated
or recognized, and not for the purpose of indemnifying the plaintiff for any loss
suffered by him.
The violation of the petitioners' right to statutory due process by the private
respondent warrants the payment of indemnity in the form of nominal damages.
Considering the prevailing circumstances in the case at bar, we deem it proper to
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fix it at P30,000.00.
Riviera Home Improvements, Inc. is further ORDERED to pay each of the
petitioners the amount of P30,000.00 as nominal damages for non-compliance
with statutory due process.
Principles: Labor Law
Where the dismissal is for a just cause, as in the instant case, the lack of statutory
due process should not nullify the dismissal, or render it illegal, or
ineffectual. However, the employer should indemnify the employee for the
violation of his statutory rights
MA. CHARITO C. GADIA V SYKES ASIA
Facts: In this case, Alltel Communications (Alltel), a United States-based
telecommunications firm, contracted Sykes Asia to accommodate the needs and
demands of Alltel clients for its postpaid and prepaid services (Alltel Project).
Services for the said project went on smoothly until Alltel sent two (2) letters to
Sykes Asia dated August 7, 2009 and September 9, 2009 informing the latter that
it was terminating all support services provided by Sykes Asia related to the Alltel
Project. In view of this development, Sykes Asia sent each of the petitioners end-
of-life notices, informing them of their dismissal from employment due to the
termination of the Alltel Project.
Aggrieved, petitioners (there are 23 employees-petitioners) filed separate
complaints for illegal dismissal against respondents Sykes Asia, Chuck Sykes, the
President and Chief Operating Officer of Sykes Enterprise, Inc., and Mike Hinds
and Michael Henderson, the President and Operations Director, respectively, of
Sykes Asia (respondents), praying for reinstatement, backwages, 13th month
pay, service incentive leave pay, night shift differential, moral and exemplary
damages, and attorney’s fees. In their complaints, petitioners alleged that their
dismissal from service was unjust as the same was effected without substantive
and procedural due process.
In their defense, respondents averred that petitioners were not regular
employees but merely project-based employees, and as such, the termination of
the Alltel Project served as a valid ground for their dismissal. In support of their
position, respondents noted that it was expressly indicated in petitioners’
respective employment contracts that their positions are “project-based” and
thus, “co-terminus to the project.” Respondents further maintained that they
complied with the requirements of procedural due process in dismissing
petitioners by furnishing each of them their notices of termination at least thirty
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(30) days prior to their respective dates of dismissal.
Labor arbiter decided in favor of Sykes, it stated that petitioners are project-
based employees.
NLRC decided that they are regular employees but were validly terminated due
to redundancy.
The CA reinstated the decision of the Labor Arbiter.
The issue before the Court is whether or not the petitioners were regular
employees or merely project-based employees, and thus, was validly dismissed
from service?
Supreme Court’s Decision.
Decision of the Supreme Court: The petitioners herein are project employees.
The Supreme Court cited Article 294 of the Labor Code, as amended,
distinguishing project-based employee from a regular employee;
Art. 294. Regular and casual employment.—The provisions of written agreement
to the contrary notwithstanding and regardless of the oral agreement of the
parties, an employment shall be deemed to be regular where the employee has
been engaged to perform activities which are usually necessary or desirable in
the usual business or trade of the employer, except where the employment has
been fixed for a specific project or undertaking the completion or termination
of which has been determined at the time of the engagement of the employee
or where the work or services to be performed is seasonal in nature and the
employment is for the duration of the season.
x x x x (Emphasis and underscoring supplied)
Verily, for an employee to be considered project-based, the employer must show
compliance with two (2) requisites, namely that: (a) the employee was assigned
to carry out a specific project or undertaking; and (b) the duration and scope of
which were specified at the time they were engaged for such project.
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In the instant case, n this case, records reveal that Sykes Asia adequately
informed petitioners of their employment status at the time of their
engagement, as evidenced by the latter’s employment contracts which similarly
provide that they were hired in connection with the Alltel Project, and that their
positions were “project-based and as such is co-terminus to the project.” In this
light, the CA correctly ruled that petitioners were indeed project-based
employees, considering that: (a) they were hired to carry out a specific
undertaking, i.e., the Alltel Project; and (b) the duration and scope of such project
were made known to them at the time of their engagement, i.e., “co-terminus
with the project.”
The word “determinable time” concerning the duration of the undertaking
simply means “capable of being determined or fixed” The Court said that Sykes
Asia substantially complied with this requisite when it expressly indicated in
petitioners’ contracts that their positions were “co-terminus with the project”.
This sufficiently apprised petitioners that their security of tenure with Sykes Asia
would only last as long as the Alltel project was subsisting.

The Supreme Court therefore decided in favor of Sykes Asia.

Have you experienced a similar situation at work? Were you dismissed because
you were a project employee? Be sure to look at your employment contract that
you signed with your employer and check if you were hired as a regular employee
or a project-employee first before going after your employer. Take note that the
case started in 2009 and ended in 2015 - six years of court battle that will
definitely test every employee-petitioner’s patience.