1.
St Scholastica’s College Westgrove was
declared guilty of illegal dismissal for
terminating a female non-teaching
personnel for having been pregnant
without benefit of prior marriage. She was
awarded separation pay in lieu of actual
reinstatement, full backwages, attorney’s
fees, and 10% monetary award. The SC
ruled that the dismissal is not a valid
exercise of management prerogative.
The Court has held that "management is
free to regulate, according to its own
discretion and judgment, all aspects of
employment, including hiring, work
assignments, working methods, time, place
and manner of work, processes to be
followed, supervision of workers, working
regulations, transfer of employees, work
supervision, lay off of workers and
discipline, dismissal and recall of workers.
The exercise of management prerogative,
however, is not absolute as it must
beexercised in good faith and with due
regard to the rights of labor." Management
cannot exercise its prerogative in a cruel,
repressive, or despotic manner.
The Court finds that the petitioner was
illegally dismissed as there was no just
cause for the termination of her
employment. SSCW failed to adduce
substantial evidence to establish that the
petitioner’s conduct, i.e., engaging in pre-
marital sexual relations and conceiving a
child out of wedlock, assessed in light of
the prevailing norms of conduct, is
considered disgraceful or immoral.
2. Immorality, as a general rule, is not a just
ground to terminate employment. The
exception is when such immoral conduct is
prejudicial or detrimental to the interest of
the employer. Pregnancy without marriage
does not affect her work… blah blah
3. Labor Code governs over Manual of
Regulations in Private Schools. It is thus
within the authority of the Secretary of
Education to issue a rule, which provides
for the dismissal of teaching and non-
teaching personnel of private schools
based on their incompetence, inefficiency,
or some other disqualification.
In resolving the foregoing question,the Court
will assess the matter from a strictly neutral
and secular point of view – the relationship
between SSCW as employer and the petitioner
as an employee, the causes provided for by
law in the termination of suchrelationship, and
the evidence on record. The ground cited for
the petitioner’s dismissal, i.e., pre-marital
sexual relations and, consequently, pregnancy
outof wedlock, will be assessed as to whether
the same constitutes a valid ground for
dismissal pursuant to Section 94(e) of the
1992 MRPS.
4. 2 Kinds of Immorality
5. Two Steps in Determining What is a
disgraceful and immoral conduct is.
6. Cases that should be filed before the:
• LABOR ARBITER
• Unfair labor practice (ULP) cases;

2. Termination disputes (or illegal dismissal
• cases);

3. If accompanied with a claim for
• reinstatement, those cases that workers
may file involving wages, rates of pay,
hours of work and other terms and
conditions of employment;
• 4. Claims for actual, moral, exemplary and
other forms of damages arising from
employer- employee relations;
• 5. Cases arising from any violation of
Article 264 of the Labor Code, including
questions involving the legality of strikes
and lockouts;
• 6. Except claims for employees
compensation not included in the next
succeeding paragraph, social security,
medicare and maternity benefits, all other
claims arising from employer-employee
relations, including those of persons in
domestic or household service, involving
an amount exceeding Five Thousand
Pesos (P5,000.00), whether or not
accompanied with a claim for
reinstatement;
• 7. Wage distortion disputes in unorganized
establishments not voluntarily settled by
the parties pursuant to Republic Act No.
6627;
• 8. Enforcement of compromise
agreements when there is non-compliance
by any of the parties pursuant to Article
227 of the Labor Code, as amended;
• 9. Money claims arising out of employer-
employee relationship or by virtue of any
 law or contract, involving Filipino workers
for overseas employment, including claims
for actual, moral, exemplary and other
forms of damages as provided by Section
10 of R.A. No. 8042, as amended by R.A.
No. 10022;
• 10. Contested cases under the exception
clause of Article 128(b) of the Labor Code,
as amended by R.A. 7730; and
• 11. Other cases as may be provided by
law.
GRIEVANCE MACHINERY
• The Voluntary Arbitrator or panel of
Voluntary Arbitrators shall have original
and exclusive jurisdiction to hear and
decide all unresolved grievances arising
from the interpretation or implementation of
the Collective Bargaining Agreement and
those arising from the interpretation or
enforcement of company personnel
policies referred to in the immediately
preceding article. Accordingly, violations of
a Collective Bargaining Agreement, except
those which are gross in character, shall
no longer be treated as unfair labor
practice and shall be resolved as
grievances under the Collective Bargaining
Agreement. For purposes of this article,
gross violations of Collective Bargaining
Agreement shall mean flagrant and/or
malicious refusal to comply with the
economic provisions of such agreement.
• The Voluntary Arbitrator or panel of
Voluntary Arbitrators, upon agreement of
the parties, shall also hear and decide all
other labor disputes including unfair labor
practices and bargaining deadlocks.
VOLUNTARY ARBITRATOR
• Article 261,  which provides for the original
and exclusive jurisdiction of voluntary
arbitrators over unresolved grievances
arising from the interpretation or
implementation of the CBA arising from the
interpretation or enforcement of company
p e r s o n n e l p o l i c i e s .    W i t h t h i s
amendment,    the original and exclusive
jurisdiction of voluntary arbitrators has
been tremendously expanded.
DOLE SECRETARY
• To recapitulate, if a complaint is brought
before the DOLE to give effect to the labor
standards provisions of the Labor Code or
other labor legislation, and there is a
finding by the DOLE that there is an
existing employer-employee relationship,
the DOLE exercises jurisdiction to the
exclusion of the NLRC.
• If the DOLE finds that there is no
employer-employee relationship, the
jurisdiction is properly with the NLRC. If a
complaint is filed with the DOLE, and it is
accompanied by a claim for reinstatement,
the jurisdiction is properly with the Labor
Arbiter, under Art. 217(3) of the Labor
Code, which provides that the Labor
Arbiter has original and exclusive
jurisdiction over those cases involving
wages, rates of pay, hours of work, and
other terms and conditions of employment,
if accompanied by a claim for
reinstatement.  If a complaint is filed with
the NLRC, and there is still an existing
employer-employee relationship, the
jurisdiction is properly with the DOLE.  The
findings of the DOLE, however, may still be
questioned through a petition for certiorari
under Rule 65 of the Rules of Court.
DOLE REGIONAL DIRECTOR
• Under Article 129 of the Labor Code,
DOLE Regional Directors or the duly
a u t h o r i z e d h e a r i n g o f fi c e r s , a r e
empowered, in a summary proceeding, to
hear and decide claims for recovery of
wages and other monetary claims and
benefits, including legal interest, provided
the following requisites concur: 

1. The claim must arise from employer-
employee relationship;
• 2. T h e c l a i m a n t d o e s n o t s e e k
reinstatement; and
• 3. The aggregate money claim of each
employee does not exceed P5,000.00. 

ST LUKE’S CASE
The right of an employer to regulate all
aspects of employment, aptly called
“management prerogative,” gives employers
the freedom to regulate, according to their
discretion and best judgment, all aspects of
employment, including work assignment,
working methods, processes to be followed,
working regulations, transfer of employees,
work supervision, lay-off of workers and the
discipline, dismissal and recall of workers.55 In
this light, courts often decline to interfere in
legitimate business decisions of employers.  In
fact, labor laws discourage interference in
employers’ judgment concerning the conduct
of their business.56cralawred
Among the employer ’s management
prerogatives is the right to prescribe
reasonable rules and regulations necessary or
proper for the conduct of its business or
concern, to provide certain disciplinary
measures to implement said rules and to
assure that the same would be complied with.
At the same time, the employee has the
corollary duty to obey all reasonable rules,
orders, and instructions of the employer; and
willful or intentional disobedience thereto, as a
general rule, justifies termination of the
contract of service and the dismissal of the
employee.57 Article 296 (formerly Article 282)
of the Labor Code provides:58cralawred
Article 296. 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 his representative in connection
with his work;ChanRoblesVirtualawlibrary
x x x xcralawlawlibrary
Note that for an employee to be validly
dismissed on this ground, the employer’s
orders, regulations, or instructions must be: (1)
reasonable and lawful, (2) sufficiently known to
the employee, and (3) in connection with the
duties which the employee has been engaged
to discharge.”59cralawred
Tested against the foregoing, the Court finds
that Sanchez was validly dismissed by SLMC
for her willful disregard and disobedience of
Section 1, Rule I of the SLMC Code of
Discipline, which reasonably punishes acts of
dishonesty, i.e., “theft, pilferage of hospital or
co-employee property, x x x or its attempt in
any form or manner from the hospital, co-
employees, doctors, visitors, [and] customers
(external and internal)” with termination from
employment.60 Such act is obviously
connected with Sanchez’s work, who, as a
staff nurse, is tasked with the proper
stewardship of medical supplies. Significantly,
records show that Sanchez made a categorical
admission61 in her handwritten letter62 – i.e.,
“[k]ahit alam kong bawal ay nagawa kong
[makapag-uwi] ng gamit”63 – that despite her
knowledge of its express prohibition under the
SLMC Code of Discipline, she still knowingly
brought out the subject medical items with her.
It is apt to clarify that SLMC cannot be faulted
in construing the taking of the questioned
items as an act of dishonesty (particularly, as
theft, pilferage, or its attempt in any form or
manner) considering that the intent to gain
may be reasonably presumed from the furtive
taking of useful property appertaining to
another.64 Note that Section 1, Rule 1 of the
SLMC Code of Discipline is further
supplemented by the company policy requiring
the turn-over of excess medical supplies/items
for proper handling65 and providing a
restriction on taking and bringing such items
out of the SLMC premises without the proper
authorization or “pass” from the official
concerned,66 which Sanchez was equally
aware thereof.67 Nevertheless, Sanchez failed
to turn-over the questioned items and, instead,
“hoarded” them, as purportedly practiced by
the other staff members in the Pediatric Unit.
As it is clear that the company policies subject
of this case are reasonable and lawful,
sufficiently known to the employee, and
evidently connected with the latter’s work, the
Court concludes that SLMC dismissed
Sanchez for a just cause.
——————————————
WATERFRONT VS LEDESMA
  In 2008, the hotel’s management fired
Ledesma for reportedly sexually harassing a
female supplier of the hotel concessionaire
inside the hotel’s elevator, as well as a job
applicant in one of the hotel’s conference
rooms.
The SC decision said that Ledesma committed
misconduct or improper behavior which
justifies his dismissal from employment.
 “If not for the position of Ledesma as a house
detective, he will not have access to the
conference room nor will he know that the
premises is not monitored by a closed-circuit
television, thus, giving him the untrammeled
opportunity to accomplish his lewd design on
the unsuspecting victims,” the decision further
read.
  On August 12, 2008, Ledesma filed a
complaint for illegal dismissal before the
Regional Arbitration Branch of the National
Labor Relations Commission (NLRC).

The labor arbiter favored Ledesma’s claim and

ordered the hotel management to reinstate
Ledesma and pay him back wages and service
incentive leave pay.
 But the hotel’s management appealed before
NLRC which later reversed the ruling of the
labor arbiter.

  NLRC held that Ledesma’s acts of sexual

overtures constituted grave misconduct, which
is a ground for his dismissal from employment.

  NLRC also denied Ledesma’s motion for

reconsideration in a resolution on February 22,
2010.

Ledesma, through his counsel, filed a petition

for certiorari before the Court of Appeals.

  On March 17, 2011, the appellate court

reversed NLRC’s decision and ruled in favor of
Ledesma, saying that his dismissal from
employment was illegal.

  However, the SC opposed CA’s decision and

reinstated the ruling of NLRC’s that found the
dismissal of Ledesma valid due to misconduct.

SEXUAL HARASSMENT The sexual favor is

made as a condition in the hiring or in the
employment, re- employment or continued
employment of said individual, or in
granting said individual favorable
compensation, terms, conditions,
promotions, or privileges; or the refusal to
grant the sexual favor results in limiting,
segregating or classifying the employee
which in a way would discriminate, deprive
or diminish employment opportunities or
otherwise adversely affect said employee;