CRC AGRICULTURAL TRADING
and ROLANDO B. CATINDIG,
Petitioners, -
versus - NATIONAL LABOR RELATIONS COMMISSION and ROBERTO OBIAS, Respondents. |
G.R. No. 177664
Present: CARPIO, J., Chairperson, LEONARDO-DE CASTRO, BRION, DEL CASTILLO, and ABAD,
JJ. Promulgated: December 23, 2009 |
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D E C I S I O N
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BRION, J.: |
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Before this
Court is the Petition for Review on Certiorari
under Rule 45 of the Rules of Court assailing the Decision[1] of the Court of Appeals (CA) dated
ANTECEDENT FACTS
The present
petition traces its roots to the complaint[5] for illegal dismissal filed by the
respondent against petitioners CRC Agricultural Trading and its owner, Rolando
B. Catindig (collectively, petitioners),
before the Labor Arbiter on June 22, 2004.
In his Sinumpaang Salaysay,[6] the respondent alleged that the
petitioners employed him as a driver sometime in 1985. The respondent worked for the petitioners
until he met an accident in 1989, after which the petitioners no longer allowed
him to work. After six years, or in
February 1995, the petitioners again hired the respondent as a driver and
offered him to stay inside the company’s premises. The petitioners gave him a P3,000.00
loan to help him build a hut for his family.
Sometime in March 2003, the
petitioners ordered respondent to have the alternator of one of its vehicles
repaired. The respondent brought the
vehicle to a repair shop and subsequently gave the petitioners two receipts
issued by the repair shop. The latter
suspected that the receipts were falsified and stopped talking to him and
giving him work assignments. The
petitioners, however, still paid him P700.00 and P500.00 on April
15 and 30, 2004, respectively, but no longer gave him any salary after that. As a result, the respondent and his family
moved out of the petitioners’ compound and relocated to a nearby place. The respondent claimed that the petitioners
paid him a daily wage of P175.00, but did not give him service incentive
leave, holiday pay, rest day pay, and overtime pay. He also alleged that the petitioners did not
send him a notice of termination.
In opposing the complaint, the
petitioners claimed that the respondent was a seasonal driver; his work was
irregular and was not fixed. The petitioners paid the respondent P175.00
daily, but under a “no work no pay” basis. The petitioners also gave him a
daily allowance of P140.00 to P200.00. In April 2003, the respondent worked only for
15 days for which he was paid the agreed wages. The petitioners maintained that they did not
anymore engage the respondent’s services after April 2003, as they had already
lost trust and confidence in him after discovering that he had forged receipts
for the vehicle parts he bought for them. Since then, the respondent had been working as
a driver for different jeepney operators.[7]
The Labor Arbiter
Ruling
Labor Arbiter
Rennell Joseph R. Dela Cruz, in his decision of
WHEREFORE, premises
considered, judgment is hereby rendered ordering respondents CRC AGRICULTURAL
TRADING and ROLANDO CATINDIG to pay complainant jointly and severally the
following:
Separation Pay - P64,740.00
Backwages
Basic pay - P146,491.80
13th month pay - 12,207.65
SIL - 2,347.63
Salary Differential - 47,944.00
Unpaid SIL - 3,467.00
__________
P277,198.08
10% attorney’s fees - 27,719.80
__________
GRAND TOTAL - P304,917.80
SO ORDERED.[8]
The NLRC Ruling
The
petitioners and the respondent both appealed the labor arbiter’s decision to
the NLRC. The petitioners specifically questioned
the ruling that the respondent was illegally dismissed. The respondent, for his part, maintained that
the labor arbiter erred when he ordered the payment of separation pay in lieu
of reinstatement.
The NLRC, in
its resolution of
The CA Decision
The petitioners
filed on August 30, 2006 a petition for certiorari
with the CA alleging that the NLRC erred in awarding the respondent separation
pay and salary differentials. They
argued that an employee who had abandoned his work, like the respondent, is no
different from one who voluntarily resigned; both are not entitled to
separation pay and to salary differentials. The petitioners added that since they had
already four regular drivers, the respondent’s job was already unnecessary and
redundant. They further argued that they
could not be compelled to retain the services of a dishonest employee.
The CA, in its
decision dated
The CA
disregarded the petitioners’ charge of abandonment against the respondent for
their failure to show that there was deliberate and unjustified refusal on the
part of the respondent to resume his employment. The CA also ruled that the
respondent’s filing of a complaint for illegal dismissal manifested his desire
to return to his job, thus negating the petitioners’ charge of abandonment. Even assuming that there had been abandonment,
the petitioners denied the respondent due process when they did not serve him
with two written notices, i.e., (1) a
notice which apprises the employee of the particular acts or omissions for
which his dismissal is sought; and (2) a subsequent notice which advises the
employee of the employer’s decision to dismiss him. Thus, the respondent is entitled to full
backwages without deduction of earnings derived elsewhere from the time his
compensation was withheld from him, up to the time of his actual reinstatement.
The CA added that reinstatement would no
longer be beneficial to both the petitioners and respondent, as the
relationship between them had already been strained.
Petitioners
moved to reconsider the decision, but the CA denied the motion for lack of
merit in its Resolution dated
In the present
petition, the petitioners alleged that the CA erred when it awarded the
respondent separation pay, backwages, salary differentials, and attorney’s
fees. They reiterated their view that an
abandoning employee like respondent is not entitled to separation benefits
because he is no different from one who voluntarily resigns.
THE COURT’S RULING
We do not find the petition meritorious.
The existence of an employer-employee relationship
A paramount
issue that needs to be resolved before we rule on the main issue of illegal
dismissal is whether there existed an employer-employee relationship between
the petitioners and the respondent. This
determination has been rendered imperative by the petitioners’ denial of the
existence of employer-employee relationship on the reasoning that they only
called on the respondent when needed.
The
elements to determine the existence of an employment relationship are: (1) the
selection and engagement of the employee; (2) the payment of wages; (3) the
power of dismissal; and (4) the employer’s power to control the employee’s
conduct. The most important element is the employer’s control of the
employee’s conduct, not only as to the result of the work to be done, but also
as to the means and methods to accomplish it. All the four elements are
present in this case.[10]
First, the petitioners
engaged the services of the respondent in 1995. Second,
the petitioners paid the respondent a daily wage of P175.00, with
allowances ranging from P140.00 to P200.00 per day. The fact the respondent was paid under a “no
work no pay” scheme, assuming this claim to be true, is not significant. The “no work no pay” scheme is merely a method
of computing compensation, not a basis for determining the existence or absence
of employer-employee relationship. Third, the petitioners’
power to dismiss the respondent was inherent in the fact that they engaged the
services of the respondent as a driver. Finally, a careful review of the record
shows that the respondent performed his work as driver under the petitioners’
supervision and control. Petitioners determined how, where, and when the
respondent performed his task. They,
in fact, requested the respondent to live inside their compound so he
(respondent) could be readily available when the petitioners needed his
services. Undoubtedly, the petitioners
exercised control over the means and methods by which the respondent
accomplished his work as a driver.
We
conclude from all these that an employer-employee relationship existed between
the petitioners and respondent.
The
respondent did not abandon his job
In a dismissal situation, the burden of proof lies with the
employer to show that the dismissal was for a just cause. In the present case, the petitioners claim
that there was no illegal dismissal, since the respondent abandoned his
job. The petitioners point out that the respondent
freely quit his work as a driver when he was suspected of forging vehicle parts
receipts.
Abandonment
of work, or the deliberate and unjustified refusal of an employee to resume his
employment, is a just cause for the termination of employment under paragraph
(b) of Article 282 of the Labor Code, since it constitutes neglect of duty.[11]
The jurisprudential rule is that
abandonment is a matter of intention that cannot be lightly
presumed from equivocal acts. To constitute abandonment, two
elements must concur: (1) the failure to report for work or absence without
valid or justifiable reason, and (2) a clear intent, manifested through overt
acts, to sever the employer-employee relationship. The employer bears the burden of showing a
deliberate and unjustified
refusal by the employee to resume his employment without any intention of
returning.[12]
In
the present case, the petitioners did not adduce any proof to show that the
respondent clearly and unequivocally intended to abandon his job or to sever
the employer-employee relationship. Moreover, the respondent’s filing of the complaint for illegal
dismissal on
Abandonment
is a matter of intention and cannot lightly be presumed from certain equivocal
acts. To constitute abandonment, there
must be clear proof of deliberate and unjustified intent to sever the
employer-employee relationship. Clearly,
the operative act is still the employee’s ultimate act of putting an end to his
employment. [Emphasis in the original]
Respondent was constructively
dismissed
Case law defines constructive dismissal as
a cessation of work because continued employment has been rendered impossible,
unreasonable, or unlikely, as when there is a demotion in rank or diminution in
pay or both or when a clear
discrimination, insensibility, or disdain by an employer becomes unbearable to
the employee.[14]
The test of constructive dismissal is
whether a reasonable person in the employee’s position would have felt
compelled to give up his position under the circumstances. It is an act amounting to dismissal but is
made to appear as if it were not. In fact, the employee who is constructively
dismissed might have been allowed to keep coming to work. Constructive dismissal is therefore a dismissal
in disguise. The law recognizes and resolves this
situation in favor of employees in order to protect their rights and interests
from the coercive acts of the employer.[15]
In the present case, the petitioners ceased verbally
communicating with the respondent and giving him work assignment after
suspecting that he had forged purchase receipts. Under this situation, the respondent was
forced to leave the petitioners’ compound with his family and to transfer to a nearby
place. Thus, the respondent’s act of leaving the petitioners’ premises was in
reality not his choice but a situation the petitioners created.
The Due Process Requirement
Even
assuming that a valid ground to dismiss the respondent exists, the petitioners
failed to comply with the twin requirements of notice and hearing under the
Labor Code.
The long established jurisprudence holds that to justify the dismissal
of an employee for a just cause, the
employer must furnish the worker with two written notices. The first is the notice to apprise the
employee of the particular acts or omissions for which his dismissal is sought. This may be
loosely considered as the charge against the employee. The second is the notice informing the
employee of the employer’s decision to dismiss him. This decision, however, must come only after
the employee is given a reasonable period from receipt of the first notice
within which to answer the charge, and ample opportunity to be heard and defend
himself with the assistance of his representative, if he so desires. The requirement of notice is not a mere
technicality, but a requirement of due process to which every employee is
entitled.
The petitioners clearly failed to comply with the two-notice
requirement. Nothing in the records shows that the
petitioners ever sent the respondent a written notice informing him of the
ground for which his dismissal was sought.
It does not also appear that the
petitioners held a hearing where the respondent was given the opportunity to
answer the charges of abandonment. Neither
did the petitioners send a written notice to the respondent informing the
latter that his service had been terminated and the reasons for the termination
of employment. Under these facts, the
respondent’s dismissal was illegal.[16]
Backwages,
Separation Pay, and Attorney’s Fees
The
respondent’s illegal dismissal carries the legal consequence
defined under Article 279 of the Labor Code: the illegally dismissed employee
is entitled to 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 his compensation
was withheld from him up to the time of his actual reinstatement. Thus, an illegally dismissed employee is
entitled to two reliefs: backwages and reinstatement. Where reinstatement is no
longer viable as an option, backwages shall be computed from the time of the
illegal termination up to the finality of the decision.[17]
Separation pay equivalent
to one month salary for every year of service should likewise be awarded as an
alternative in case reinstatement in not possible.[18]
In the present case, reinstatement is no
longer feasible because of the strained relations between the
petitioners and the respondent. Time and again, this Court has
recognized that strained relations between the
employer and employee is an exception to the rule requiring actual
reinstatement for illegally dismissed employees for the practical reason that
the already existing antagonism will only fester and deteriorate, and will only
worsen with possible adverse effects on the parties, if we shall compel
reinstatement; thus, the use of a viable substitute that protects the interests
of both parties while ensuring that the law is respected.
In this case, the
antagonism between the parties cannot be doubted, evidenced by the petitioners’
refusal to talk to the respondent after their suspicion of fraudulent
misrepresentation was aroused, and by the respondent’s own decision to leave
the petitioners’ compound together with his family. Under these undisputed facts, a peaceful
working relationship between them is no longer possible and reinstatement is
not to the best interest of the parties. The payment of separation pay is the better
alternative as it liberates the respondent from what could be a highly hostile
work environment, while releasing the petitioners from the grossly unpalatable
obligation of maintaining in their employ a worker they could no longer trust.
The
respondent having been compelled to litigate in order to seek redress, the CA
correctly affirmed the labor arbiter’s grant of attorney’s fees equivalent to
10% of the total monetary award.[19]
The records of this case, however,
are incomplete for purposes of computing the exact monetary award due to the
respondent. Thus, it is necessary to
remand this case to the Labor Arbiter for the sole purpose of computing the
proper monetary award.
WHEREFORE,
premises considered, we hereby DENY
the petition. The Decision of the Court of Appeals dated February 20, 2007 and
its Resolution dated April 30, 2007 in CA-G.R. SP No. 95924 are AFFIRMED and the case is REMANDED
to the Labor Arbiter for the sole purpose of computing the full backwages,
inclusive of allowances and other benefits of respondent Roberto Obias,
computed from the date of his dismissal up to the finality of the decision, and
separation pay in lieu of reinstatement equivalent to one month salary for
every year of service, computed from the time of his engagement up to the
finality of this decision.
SO ORDERED.
ARTURO D.
BRION
Associate Justice
WE CONCUR:
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ANTONIO T. CARPIO Associate Justice Chairperson |
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TERESITA J. LEONARDO-DE
CASTRO Associate
Justice |
MARIANO C. Associate Justice |
ROBERTO A. ABAD
Associate Justice
ATTESTATION
I attest 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’s Division.
ANTONIO T. CARPIO
Associate Justice
Chairperson
CERTIFICATION
REYNATO
S. PUNO
Chief Justice
[1] Penned by Associate Justice Jose Catral Mendoza, and concurred in by Associate Justice Remedios A. Salazar-Fernando and Associate Justice Ramon M. Bato, Jr.; rollo, pp. 64-74.
[2]
[3]
[4]
[5]
[6]
[7]
[8]
[9] Supra note 3.
[10] See Chavez v. National Labor Relations Commission, 489 Phil. 444 (2005).
[11] See Victory
Liner, Inc. v. Race, G.R. No. 164820,
[12] Pentagon
Steel Corporation v. Court of Appeals, G.R. No. 174141,
[13] 459 Phil. 506, 516 (2003).
[14] La Rosa v. Ambassador Hotel, G.R. No. 177059, March 13, 2009; Segue v. Triumph International (Phils.), Inc., G.R. No. 164804, January 30, 2009, 577 SCRA 323, 333.
[15] Uniwide Sales Warehouse Club v. National Labor Relations Commission, G.R. No. 154503, February 29, 2008, 547 SCRA 220, 236.
[16] Mendoza v. National Labor Relations Commission, 350 Phil. 486 (1998).
[17] See RBC
Cable Master System v. Baluyot, G.R. No. 172670,
[18]
[19]
Macasero
v. Southern Industrial Gases