EN BANC
FELIX
B. PEREZ and G.R. No. 152048
AMANTE
G. DORIA,
Petitioners,
Present:
PUNO, C.J.,
QUISUMBING,
YNARES-SANTIAGO,
CARPIO,
AUSTRIA-MARTINEZ,*
- v e r s u s
- CORONA,
CARPIO MORALES,
TINGA,
CHICO-NAZARIO,
VELASCO, JR.,
NACHURA,
LEONARDO-DE
CASTRO,
BRION
and
PERALTA,
JJ.
PHILIPPINE
TELEGRAPH AND
TELEPHONE
COMPANY and
JOSE
LUIS SANTIAGO,
Respondents. Promulgated:
April 7, 2009
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D E
C I S I O N
CORONA, J.:
Petitioners Felix B. Perez and Amante
G. Doria were employed by respondent Philippine Telegraph and Telephone Company
(PT&T) as shipping clerk and supervisor, respectively, in PT&T’s
Shipping Section, Materials Management Group.
Acting on an alleged unsigned letter
regarding anomalous transactions at the Shipping Section, respondents formed a
special audit team to investigate the matter. It was discovered that the
Shipping Section jacked up the value of the freight costs for goods shipped and
that the duplicates of the shipping documents allegedly showed traces of
tampering, alteration and superimposition.
On September 3, 1993, petitioners
were placed on preventive suspension for 30 days for their alleged involvement
in the anomaly.[1]
Their suspension was extended for 15 days twice: first on October 3, 1993[2] and
second on October 18, 1993.[3]
On October 29, 1993, a memorandum with
the following tenor was issued by respondents:
In line with the recommendation of the AVP-Audit as presented in his report of October 15, 1993 (copy attached) and the subsequent filing of criminal charges against the parties mentioned therein, [Mr. Felix Perez and Mr. Amante Doria are] hereby dismissed from the service for having falsified company documents.[4] (emphasis supplied)
On November 9, 1993, petitioners
filed a complaint for illegal suspension and illegal dismissal.[5] They
alleged that they were dismissed on November 8, 1993, the date they received
the above-mentioned memorandum.
The labor arbiter found that the
30-day extension of petitioners’ suspension and their subsequent dismissal were
both illegal. He ordered respondents to pay petitioners their salaries during
their 30-day illegal suspension, as well as to reinstate them with backwages
and 13th month pay.
The National Labor Relations
Commission (NLRC) reversed the decision of the labor arbiter. It ruled that
petitioners were dismissed for just cause, that they were accorded due process
and that they were illegally suspended for only 15 days (without stating the
reason for the reduction of the period of petitioners’ illegal suspension).[6]
Petitioners appealed to the Court of
Appeals (CA). In its January 29, 2002 decision,[7] the CA
affirmed the NLRC decision insofar as petitioners’ illegal suspension for 15
days and dismissal for just cause were concerned. However, it found that
petitioners were dismissed without due process.
Petitioners now seek a reversal of
the CA decision. They contend that there was no just cause for their dismissal,
that they were not accorded due process and that they were illegally suspended
for 30 days.
We rule in favor of petitioners.
Respondents Failed to Prove Just
Cause and to Observe Due Process
The CA, in upholding the NLRC’s decision, reasoned that there was sufficient basis for respondents to lose their confidence in petitioners[8] for allegedly tampering with the shipping documents. Respondents emphasized the importance of a shipping order or request, as it was the basis of their liability to a cargo forwarder.[9]
We disagree.
Without undermining the importance of
a shipping order or request, we find respondents’ evidence insufficient to
clearly and convincingly establish the facts from which the loss of confidence resulted.[10] Other than their bare allegations and the
fact that such documents came into petitioners’ hands at some point,
respondents should have provided evidence of petitioners’ functions, the extent
of their duties, the procedure in the handling and approval of shipping
requests and the fact that no personnel other than petitioners were involved.
There was, therefore, a patent paucity of proof connecting petitioners to the
alleged tampering of shipping documents.
The alterations on the shipping
documents could not reasonably be attributed to petitioners because it was never
proven that petitioners alone had control of or access to these documents.
Unless duly proved or sufficiently substantiated otherwise, impartial tribunals
should not rely only on the statement of the employer that it has lost
confidence in its employee.[11]
Willful breach by the employee of the
trust reposed in him by his employer or duly authorized representative is a
just cause for termination.[12]
However, in General Bank and Trust Co. v. CA,[13] we
said:
[L]oss of confidence should not be simulated. It should not be used as a subterfuge for causes which are improper, illegal or unjustified. Loss of confidence may not be arbitrarily asserted in the face of overwhelming evidence to the contrary. It must be genuine, not a mere afterthought to justify an earlier action taken in bad faith.
The burden of proof rests on the
employer to establish that the dismissal is for cause in view of the security
of tenure that employees enjoy under the Constitution and the Labor Code. The
employer’s evidence must clearly and convincingly show the facts on which the
loss of confidence in the employee may be fairly made to rest.[14] It must
be adequately proven by substantial evidence.[15] Respondents
failed to discharge this burden.
Respondents’ illegal act of
dismissing petitioners was aggravated by their failure to observe due process.
To meet the requirements of due process in the dismissal of an employee, an
employer must furnish the worker with two written notices: (1) a written notice
specifying the grounds for termination and giving to said employee a reasonable
opportunity to explain his side and (2) another written notice indicating that,
upon due consideration of all circumstances, grounds have been established to
justify the employer's decision to dismiss the employee.[16]
Petitioners were neither apprised of
the charges against them nor given a chance to defend themselves. They were
simply and arbitrarily separated from work and served notices of termination in
total disregard of their rights to due process and security of tenure. The
labor arbiter and the CA correctly found that respondents failed to comply with
the two-notice requirement for terminating employees.
Petitioners likewise contended that
due process was not observed in the absence of a hearing in which they
could have explained their side and refuted the evidence against them.
There is no need for a hearing or
conference. We note a marked difference in the standards of due process to be
followed as prescribed in the Labor Code and its implementing rules. The Labor
Code, on one hand, provides that an employer must provide the employee ample
opportunity to be heard and to defend himself with the assistance of his
representative if he so desires:
ART. 277. Miscellaneous provisions. — x x x
(b)
Subject to the constitutional right of workers to security of tenure and their
right to be protected against dismissal except for a just and authorized cause
and without prejudice to the requirement of notice under Article 283 of this
Code, the employer shall furnish the worker whose employment is sought to be
terminated a written notice containing a statement of the causes for
termination and shall afford the latter ample opportunity to be heard and to
defend himself with the assistance of his representative if he so desires
in accordance with company rules and regulations promulgated pursuant to
guidelines set by the Department of Labor and Employment. Any decision taken by
the employer shall be without prejudice to the right of the worker to contest
the validity or legality of his dismissal by filing a complaint with the
regional branch of the National Labor Relations Commission. The burden of
proving that the termination was for a valid or authorized cause shall rest on
the employer. (emphasis supplied)
The omnibus rules implementing the
Labor Code, on the other hand, require a hearing and conference during
which the employee concerned is given the opportunity to respond to the charge,
present his evidence or rebut the evidence presented against him:[17]
Section 2. Security
of Tenure. — x x x
(d) In all cases of termination of employment, the following standards of due process shall be substantially observed:
For termination of employment based on just causes as defined in Article 282 of the Labor Code:
(i) 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.
(ii) 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.
(iii)
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. (emphasis supplied)
Which one should be followed? Is a
hearing (or conference) mandatory in cases involving the dismissal of an
employee? Can the apparent conflict between the law and its IRR be reconciled?
At the outset, we reaffirm the
time-honored doctrine that, in case of conflict, the law prevails over the
administrative regulations implementing it.[18] The
authority to promulgate implementing rules proceeds from the law itself. To be valid, a rule or regulation must
conform to and be consistent with the provisions of the enabling statute.[19] As
such, it cannot amend the law either by abridging or expanding its scope.[20]
Article 277(b) of the Labor Code
provides that, in cases of termination for a just cause, an employee must be
given “ample opportunity to be heard and to defend
himself.” Thus, the opportunity to be heard afforded by law to the
employee is qualified by the word “ample” which ordinarily means “considerably
more than adequate or sufficient.”[21] In this
regard, the phrase “ample opportunity to be heard”
can be reasonably interpreted as extensive enough to cover actual hearing or
conference. To this extent, Section 2(d), Rule I of the Implementing
Rules of Book VI of the Labor Code is in conformity with Article 277(b).
Nonetheless, Section 2(d), Rule I of
the Implementing Rules of Book VI of the Labor Code should not be taken to mean
that holding an actual hearing or conference is a condition sine qua non
for compliance with the due process requirement in termination of employment.
The test for the fair procedure guaranteed under Article 277(b) cannot be
whether there has been a formal pretermination confrontation between the
employer and the employee. The “ample opportunity to be heard” standard is
neither synonymous nor similar to a formal hearing. To confine the employee’s
right to be heard to a solitary form narrows down that right. It deprives him
of other equally effective forms of adducing evidence in his defense.
Certainly, such an exclusivist and absolutist interpretation is overly
restrictive. The “very nature of due process negates any concept of
inflexible procedures universally applicable to every imaginable situation.”[22]
The standard for the hearing
requirement, ample opportunity, is couched in general language revealing the
legislative intent to give some degree of flexibility or adaptability to meet
the peculiarities of a given situation. To confine it to a single rigid
proceeding such as a formal hearing will defeat its spirit.
Significantly, Section 2(d), Rule I
of the Implementing Rules of Book VI of the Labor Code itself provides that the
so-called standards of due process outlined therein shall be observed “substantially,”
not strictly. This is a recognition that while a formal hearing or
conference is ideal, it is not an absolute, mandatory or exclusive avenue of
due process.
An employee’s right to be heard in
termination cases under Article 277(b) as implemented by Section 2(d), Rule I
of the Implementing Rules of Book VI of the Labor Code should be interpreted in
broad strokes. It is satisfied not only by a formal face to face confrontation
but by any meaningful opportunity to controvert the charges against him and to submit
evidence in support thereof.
A hearing means that a party should
be given a chance to adduce his evidence to support his side of the case and
that the evidence should be taken into account in the adjudication of the controversy.[23] “To
be heard” does not mean verbal argumentation alone inasmuch as one may be heard
just as effectively through written explanations, submissions or pleadings.[24]
Therefore, while the phrase “ample opportunity to be heard” may in fact include
an actual hearing, it is not limited to a formal hearing only. In other words,
the existence of an actual, formal “trial-type” hearing, although preferred, is
not absolutely necessary to satisfy the employee’s right to be heard.
This Court has consistently ruled
that the due process requirement in cases of termination of employment does not
require an actual or formal hearing. Thus, we categorically declared in Skipper’s
United Pacific, Inc. v. Maguad:[25]
The Labor Code does not, of course, require a formal or trial type proceeding before an erring employee may be dismissed. (emphasis supplied)
In Autobus Workers’ Union v. NLRC,[26] we
ruled:
The twin requirements of notice and hearing constitute the
essential elements of due process. Due process of law simply means giving
opportunity to be heard before judgment is rendered. In fact, there is no
violation of due process even if no hearing was conducted, where the party was
given a chance to explain his side of the controversy. What is frowned upon
is the denial of the opportunity to be heard.
x x x x x
x x x x
A formal trial-type hearing is not even essential to due
process. It is enough that the parties are given a fair and reasonable
opportunity to explain their respective sides of the controversy and to present
supporting evidence on which a fair decision can be based. This type of hearing is not even mandatory in cases of complaints
lodged before the Labor Arbiter. (emphasis supplied)
In Solid Development Corporation
Workers Association v. Solid Development Corporation,[27] we had
the occasion to state:
[W]ell-settled is the dictum that the
twin requirements of notice and hearing constitute the essential elements of
due process in the dismissal of employees. It is a cardinal rule in our
jurisdiction that the employer must furnish the employee with two written
notices before the termination of employment can be effected: (1) the first
apprises the employee of the particular acts or omissions for which his
dismissal is sought; and (2) the second informs the employee of the employer’s
decision to dismiss him. The requirement of a hearing, on the other hand, is
complied with as long as there was an opportunity to be heard, and not
necessarily that an actual hearing was conducted.
In separate infraction reports, petitioners were both apprised of the particular acts or omissions constituting the charges against them. They were also required to submit their written explanation within 12 hours from receipt of the reports. Yet, neither of them complied. Had they found the 12-hour period too short, they should have requested for an extension of time. Further, notices of termination were also sent to them informing them of the basis of their dismissal. In fine, petitioners were given due process before they were dismissed. Even if no hearing was conducted, the requirement of due process had been met since they were accorded a chance to explain their side of the controversy. (emphasis supplied)
Our holding in National
Semiconductor HK Distribution, Ltd. v. NLRC[28] is
of similar import:
That
the investigations conducted by petitioner may not be considered formal
or recorded hearings or investigations is immaterial. A formal or trial
type hearing is not at all times and in all instances essential to due process,
the requirements of which are satisfied where the parties are afforded fair and
reasonable opportunity to explain their side of the controversy. It is deemed
sufficient for the employer to follow the natural sequence of notice, hearing
and judgment.
The above rulings are a clear recognition
that the employer may provide an employee with ample opportunity to be heard
and defend himself with the assistance of a representative or counsel in ways
other than a formal hearing. The employee can be fully afforded a chance to
respond to the charges against him, adduce his evidence or rebut the evidence
against him through a wide array of methods, verbal or written.
After receiving the first notice apprising
him of the charges against him, the employee may submit a written explanation (which may be in the form
of a letter, memorandum, affidavit or position paper) and offer evidence in
support thereof, like relevant company records (such as his 201 file and daily
time records) and the sworn statements of his witnesses. For this purpose, he
may prepare his explanation personally or with the assistance of a
representative or counsel. He may also ask the employer to provide him copy of
records material to his defense. His written explanation may also include a
request that a formal hearing or conference be held. In such a case, the
conduct of a formal hearing or conference becomes mandatory, just as it is where
there exist substantial evidentiary disputes[29] or where
company rules or practice requires an actual hearing as part of employment pretermination
procedure. To this extent, we refine the decisions we have rendered so far on
this point of law.
This interpretation of Section 2(d),
Rule I of the Implementing Rules of Book VI of the Labor Code reasonably
implements the “ample opportunity to be heard” standard under Article 277(b) of
the Labor Code without unduly restricting the language of the law or
excessively burdening the employer. This not only respects the power vested in
the Secretary of Labor and Employment to promulgate rules and regulations that
will lay down the guidelines for the implementation of Article 277(b). More
importantly, this is faithful to the mandate of Article 4 of the Labor Code
that “[a]ll doubts in the implementation and interpretation of the provisions
of [the Labor Code], including its implementing rules and regulations shall be
resolved in favor of labor.”
In sum, the following are the guiding
principles in connection with the hearing requirement in dismissal cases:
(a) “ample
opportunity to be heard” means any meaningful opportunity (verbal or written)
given to the employee to answer the charges against him and submit evidence in
support of his defense, whether in a hearing, conference or some other fair,
just and reasonable way.
(b) a formal hearing or conference becomes
mandatory only when requested by the employee in writing or substantial
evidentiary disputes exist or a company rule or practice requires it, or when
similar circumstances justify it.
(c) the “ample opportunity to be heard” standard
in the Labor Code prevails over the “hearing or conference” requirement in the
implementing rules and regulations.
Petitioners Were Illegally
Suspended for 30 Days
An employee may be validly suspended by the employer for just cause provided by law. Such suspension shall only be for a period of 30 days, after which the employee shall either be reinstated or paid his wages during the extended period.[30]
In this case, petitioners contended
that they were not paid during the two 15-day extensions, or a total of 30
days, of their preventive suspension. Respondents failed to adduce evidence to
the contrary. Thus, we uphold the ruling of the labor arbiter on this point.
Where the dismissal was without just
or authorized cause and there was no due process, Article 279 of the Labor
Code, as amended, mandates that the employee is entitled to reinstatement
without loss of seniority rights and other privileges and full backwages,
inclusive of allowances, and other benefits or their monetary equivalent
computed from the time the compensation was not paid up to the time of actual
reinstatement.[31]
In this case, however, reinstatement is no longer possible because of the
length of time that has passed from the date of the incident to final
resolution.[32]
Fourteen years have transpired from the time petitioners were wrongfully
dismissed. To order reinstatement at this juncture will no longer serve any
prudent or practical purpose.[33]
WHEREFORE, the petition is hereby GRANTED.
The decision of the Court of Appeals dated January 29, 2002 in CA-G.R. SP No.
50536 finding that petitioners Felix B. Perez and Amante G. Doria were not
illegally dismissed but were not accorded due process and were illegally
suspended for 15 days, is SET ASIDE. The decision of the labor arbiter
dated December 27, 1995 in NLRC NCR CN. 11-06930-93 is hereby AFFIRMED with
the MODIFICATION that petitioners should be paid their separation pay in
lieu of reinstatement.
SO ORDERED.
RENATO C. CORONA
Associate Justice
WE CONCUR:
REYNATO
S. PUNO
Chief
Justice
LEONARDO A.
QUISUMBING
Associate Justice |
CONSUELO YNARES-SANTIAGO Associate
Justice |
|
ANTONIO T. CARPIO Associate Justice |
(On Official Leave) MA. ALICIA M. AUSTRIA-MARTINEZ Associate Justice
|
|
CONCHITA CARPIO MORALES Associate
Justice
|
DANTE O. TINGA Associate Justice |
|
MINITA V. CHICO-NAZARIO Associate Justice |
PRESBITERO J. VELASCO, JR. Associate
Justice
|
|
ANTONIO EDUARDO B. NACHURA Associate Justice |
TERESITA J. LEONARDO-DE CASTRO Associate Justice |
|
ARTURO D. BRION Associate Justice |
DIOSDADO M. PERALTA Associate Justice |
Pursuant to Section 13, Article
VIII of the Constitution, I certify that the conclusions in the above decision
had been reached in consultation before the case was assigned to the writer of
the opinion of the Court.
REYNATO S. PUNO
* On official leave.
[1] Records, pp. 70-71.
[2] Id., pp. 72-73.
[3] Id., pp. 74-75.
[4] Id., p. 76.
[5] Id., p. 39.
[6] Decision penned by Commissioner Ireneo B. Bernardo, and concurred in by Presiding Commissioner Lourdes C. Javier and Commissioner Joaquin A. Tanodra.
[7] Decision of the Court of Appeals, penned by Associate Justice (now retired Associate Justice of the Supreme Court) Ruben T. Reyes, and concurred in by Associate Justices Renato C. Dacudao and Mariano C. del Castillo of the Ninth Division of the Court of Appeals.
[8] Rollo, p. 34.
[9] Records, p. 107.
[10] Commercial Motors Corporation v. Commissioners, et al., G.R. No. 14762, 10 December 1990, 192 SCRA 191, 197.
[11] Santos v. NLRC, G.R. No. L-76991, October 28, 1988, 166 SCRA 759, 765. De Leon v. NLRC, G.R. No. 52056, October 30, 1980, 100 SCRA 691, 700.
[12] Labor Code, Book VI, Title 1, Art. 282 (c).
[13] G.R. No. L-42724, 9 April 1985, 135 SCRA 569, 578.
[14] Imperial Textile Mills, Inc. v. NLRC, G.R. No. 101527, 19 January 1993, 217 SCRA 237, 244-245.
[15] Starlite Plastic Industrial Corp. v. NLRC, G.R. No. 78491, 16 March 1989, 171 SCRA 315, 324.
[16] Omnibus Rules Implementing the Labor Code, Book VI, Rule 1, Sec. 2 (a) and (c).
[17] Section 2(d), Rule I, Implementing Rules of Book VI of the Labor Code.
[18] See Conte v. Palma, 332 Phil. 20 (1996) citing Kilusang Mayo Uno Labor Center v. Garcia, Jr., G.R. No. 115381, 23 December 1994, 239 SCRA 386.
[19] Id. citing Lina Jr. v. Cariño, G.R. No. 100127, 23 April 1993, 221 SCRA 515.
[20] Implementing rules and regulations may not enlarge, alter or restrict the provisions of the law they seek to implement; they cannot engraft additional requirements not contemplated by the legislature (Pilipinas Kao, Inc. v. Court of Appeals, 423 Phil. 834 [2001]).
[21] Webster’s Third New Collegiate International Dictionary Of The English Language Unabridged, p. 74, 1993 edition.
[22] Cafeteria Workers v. McElroy, 367 U.S. 886 (1961).
[23] Gonzales v. Commission on Elections, G.R. No. 52789, 19 December 1980, 101 SCRA 752.
In the landmark case on administrative due process, Ang Tibay v. Court of Industrial Relations (69 Phil. 635 [1940]), this Court laid down seven cardinal primary rights:
(1) The first of these rights is the right to a hearing, which includes the right of the party interested or affected to present his own case and submit evidence in support thereof. x x x (2) Not only must the party be given an opportunity to present his case and to adduce evidence tending to establish the rights which he asserts but the tribunal must consider the evidence presented. x x x
[24] Rizal CommercialBanking Corporation v. Commissioner of Internal Revenue, G.R. No. 168498, 16 June 2006, 491 SCRA 213.
[25] G.R. No. 166363, 15 August 2006, 498 SCRA 639.
[26] 353 Phil. 419 (1998).
[27] G.R. No. 165995, 14 August 2007, 530 SCRA 132.
[28] 353 Phil. 551 (1998).
[29] See Cleveland Board of Education v. Loudermill, 470 U.S. 532 (1985) (Brennan J., concurring in part and dissenting in part) citing Arnett v. Kennedy, 416 U.S. 134 (1974) (Marshall J., dissenting).
[30] Omnibus Rules Implementing the Labor Code, Book V, Rule XXIII, Sec. 9, as amended by Department of Labor and Employment Order No. 9 (1997).
[31] Agabon v. NLRC, G.R. No. 158693, 17 November 2004, 442 SCRA 573, 610.
[32] Panday v. NLRC, G.R. No. 67664, 20 May 1992, 209 SCRA 122, 126-127.
[33] Sealand Service, Inc. v. NLRC, G.R. No. 90500, 5 October 1990, 190 SCRA 347, 355.