SECOND DIVISION
|
WENSHA SPA CENTER, INC.
and/or XU ZHI JIE, Petitioners, - versus - LORETA T. YUNG, Respondent. |
|
G.R. No. 185122 Present: CARPIO, J.,
Chairperson, NACHURA, PERALTA, ABAD, and MENDOZA, JJ. Promulgated: August 16, 2010 |
X
--------------------------------------------------------------------------------------
X
D
E C I S I O N
MENDOZA, J.:
This is a petition for review on certiorari under Rule 45 of
the Rules of Court filed by an employer who was charged before the National
Labor Relations Commission (NLRC) for dismissing an employee upon the
advice of a Feng Shui master. In this
action, the petitioners assail the May 28, 2008 Decision[1]
and October 23, 2008 Resolution[2]
of the Court of Appeals (CA) in CA-G.R.
SP No. 98855 entitled Loreta T. Yung v. National Labor Relations Commission,
Wensha Spa Center, Inc. and/or Xu Zhi Jie.
THE FACTS:
Wensha Spa Center, Inc. (Wensha)
in
In her position paper,[4]
Loreta stated that she used to be employed by Manmen Services Co., Ltd. (Manmen) where Xu was a client. Xu was
apparently impressed by Loreta’s performance. After he established Wensha, he
convinced Loreta to transfer and work at Wensha. Loreta was initially reluctant to accept Xu’s
offer because her job at Manmen was stable and she had been with Manmen for
seven years. But Xu was persistent and
offered her a higher pay. Enticed,
Loreta resigned from Manmen and transferred to Wensha. She started working on P12,000.00.
Loreta introduced positive changes to Wensha which resulted
in increased business. This pleased Xu
so that on
Loreta recounted that on
Wensha and Xu denied illegally terminating Loreta’s
employment. They claimed that two months after Loreta was hired, they received
various complaints against her from the employees so that on
The Labor Arbiter (LA) Francisco Robles dismissed
Loreta’s complaint for lack of merit. He found it more probable that Loreta was
dismissed from her employment due to Wensha’s loss of trust and confidence in
her. The LA’s decision[7]
partly reads:
However, this office has found it dubious and hard
to believe the contentions made by the complainant that she was dismissed by
the respondents on the sole ground that she is a “mismatch” in respondents'
business as advised by an alleged Feng Shui Master. The complainant herself alleged in her
position paper that she has done several improvements in respondents’ business
such as uplifting the morale and efficiency of its employees and increasing
respondents’ clientele, and that respondent Co was very much pleased with the
improvements made by the complainant that she was offered twice a promotion but
she nevertheless declined. It would be
against human experience and contrary to business acumen to let go of someone,
who was an asset and has done so much for the company merely on the ground that
she is a “mismatch” to the business.
Absent any proof submitted by the complainant, this office finds it more
probable that the complainant was dismissed due to loss of trust and
confidence.[8]
This ruling was affirmed by the NLRC in its December 29, 2006
Resolution,[9]
citing its observation that Wensha was still considering the proper action to
take on the day Loreta left Wensha and filed her complaint. The NLRC added that this finding was
bolstered by Wensha’s
Loreta moved for a reconsideration of the NLRC’s ruling but
her motion was denied. Loreta then went to
the CA on a petition for certiorari. The
CA reversed the ruling of the NLRC on
the ground that it gravely abused its discretion in appreciating the factual
bases that led to Loreta’s dismissal. The
CA noted that there were irregularities and inconsistencies in Wensha’s
position. The CA stated the following:
We,
thus, peruse the affidavits and documentary evidence of the Private Respondents
and find the following: First, on
the affidavits of their witnesses, it must be noted that the same were mere photocopies. It was held that [T]he purpose of the rule
in requiring the production of the best evidence is the prevention of fraud,
because if a party is in possession of such evidence and withholds it, and
seeks to substitute inferior evidence in its place, the presumption naturally
arise[s] that the better evidence is withheld for fraudulent purposes which its
production would expose and defeat. Moreover,
the affidavits were not executed under oath.
The rule is that an affiant must sign the document in the presence of
and take his oath before a notary public
as evidence that the affidavit was properly made. Guided by these principles, the affidavits
cannot be assigned any weighty probative value and are mere scraps of paper the
contents of which are hearsay. Second,
on the sales report and order slips, which allegedly prove that Yung had been
charging her food and drinks to Wensha, the said pieces of evidence do not,
however, bear Yung’s name thereon or even her signature. In fact, it does not state anyone’s name,
except that of Wensha. Hence, it would
simply be capricious to pinpoint, or impute, on Yung as the author in charging
such expenses to Wensha on the basis of hearsay evidence. Third, while the affidavit of Wensha’s
Operations Manager, Princess delos Reyes (delos Reyes), may have been duly
executed under oath, she did not, however, specify the alleged infractions that
Yung committed. If at all, delos Reyes
only made general statements on the alleged complaints against Yung that were
not even substantiated by any other piece of evidence. Finally, the daily time records (DTRs)
of Yung, which supposedly prove her habitual tardiness, were mere photocopies
that are not even signed by Wensha’s authorized representative, thus suspect,
if not violative of the best evidence rule and, therefore, incompetent
evidence. x x x [Emphases appear in the original]
x x x
x.
Finally,
after the Private Respondents filed their position paper, they alleged mistake
on the part of their former counsel in stating that Yung was dismissed on
Hence, the fallo of the CA
decision reads:
WHEREFORE, the instant petition is GRANTED.
Wensha Spa Center, Inc. and Xu Zhi Jie are ORDERED to, jointly and severally,
pay Loreta T. Yung her full backwages, other privileges, and benefits, or their
monetary equivalent, corresponding to the period of her dismissal from
September 1, 2004 up to the finality of this decision, and damages in the
amounts of fifty thousand pesos (Php50,000.00) as moral damages, twenty five
thousand pesos (Php25,000.00) as exemplary damages, and twenty thousand pesos
(Php20,000.00) as attorney’s fees. No
costs.
SO
ORDERED.[11]
Wensha and Xu now assail this ruling of the CA in this
petition presenting the following:
V.
GROUNDS
FOR THE ALLOWANCE OF THE PETITION
5.1 The following are the reasons and
arguments, which are purely questions of law and some questions of facts, which
justify the appeal by certiorari under Rule 45 of the 1997 Revised Rules of
Civil Procedure, as amended, to this Honorable SUPREME COURT of the assailed
Decision and Resolution, to wit:
5.1.1
The Honorable COURT OF APPEALS
gravely erred in reversing that factual findings of the Honorable Labor Arbiter
and the Honorable NLRC (Third Division) notwithstanding recognized and
established rule in our jurisdiction that findings of facts of quasi-judicial
agencies who have gained expertise on their respective subject matters are
given respect and finality;
5.1.2 The Honorable COURT OF APPEALS committed
grave abuse of discretion and serious errors when it ruled that findings of
facts of the Honorable Labor Arbiter and the Honorable NLRC are not supported
by substantial evidence despite the fact that the records clearly show that
petitioner therein was not dismissed but is under investigation, and that she
is guilty of serious infractions that warranted her termination;
5.1.3 The Honorable COURT OF APPEALS grave[ly]
erred when it ordered herein petitioner to pay herein respondent her separation
pay, in lieu of reinstatement, and full backwages, as well as damages and attorney’s
fees;
5.1.4 The Honorable COURT OF APPEALS committed
grave abuse of discretion and serious errors when it held that petitioner XU
ZHI JIE to be solidarily liable with WENSHA, assuming that respondent was
illegally dismissed;
5.2 The same need to be corrected as they
would work injustice to the herein petitioner, grave and irreparable damage
will be done to him, and would pose dangerous precedent.[12]
THE COURT’S RULING:
Loreta’s security of tenure is guaranteed by the Constitution
and the Labor Code. The 1987 Philippine
Constitution provides in Section 18, Article II that the State shall protect
the rights of workers and promote their welfare. Section 3, Article XIII also provides that
all workers shall be entitled to security of tenure. Along that line, Article 3 of the Labor Code
mandates that the State shall assure the rights of workers to security of
tenure.
Under the security of tenure guarantee, a worker can only be
terminated from his employment for cause and after due process. For a valid termination
by the employer: (1) the dismissal must be for a valid cause as provided in
Article 282, or for any of the authorized causes under Articles 283 and 284 of
the Labor Code; and (2) the employee must be afforded an opportunity to be
heard and to defend himself. A just and valid cause for an employee’s dismissal
must be supported by substantial evidence, and before the employee can be
dismissed, he must be given notice and an adequate opportunity to be heard.[13]
In the process, the employer bears the
burden of proving that the dismissal of an employee was for a valid cause. Its failure to discharge this burden renders
the dismissal unjustified and, therefore, illegal.[14]
As a rule, the factual findings of the court below are
conclusive on Us in a petition for review on certiorari where We review only
errors of law. This case, however, is an exception because the CA’s factual
findings are not congruent with those of the NLRC and the LA.
According to Wensha in its position paper,[15]
it dismissed Loreta on
Wensha also alleged that Loreta was “sowing intrigues in the
company” which was inimical to Wensha. She
was also accused of dishonesty, serious breach of trust reposed in her,
tardiness, and abuse of authority.[17]
In its Rejoinder, Wensha changed its position claiming that it did not terminate
Loreta’s employment on
As correctly found by the CA, the cause of Loreta’s dismissal
is questionable. Loss of trust and
confidence to be a valid ground for dismissal must have basis and must be founded
on clearly established facts.[19]
The Court finds the LA ruling that states, “[a]bsent any proof submitted by the
complainant, this office finds it more probable that the complainant was
dismissed due to loss of trust and confidence,”[20] to be utterly erroneous
as it is contrary to the applicable rules and pertinent jurisprudence. The onus of proving a valid dismissal rests
on the employer, not on the employee.[21] It is the employer who bears the burden of
proving that its dismissal of the employee is for a valid or authorized cause
supported by substantial evidence. [22]
According to the NLRC, “[p]erusal
of the entire records show that complainant left the respondents’ premises when
she was confronted with the infractions imputed against her.”[23] This information was taken from the affidavit[24]
of Princess Delos Reyes (
It is also noteworthy that Wensha’s position paper related
that because of the gossips perpetrated by Loreta, a certain Oliva Gonzalo (Gonzalo)
resigned from Wensha. Because of the
incident, Gonzalo, whose father was a policeman, “reportedly got angry with
complainant and of the management telling her friends at respondent company
that she would retaliate thus creating fear among those concerned.”[26]
As a result, Loreta was advised to take
a paid leave of absence for one month while Wensha conducted an investigation.
According to Loreta, however, the reason
for her termination was her aura did not match that of Xu and the work
environment at Wensha. Loreta narrated:
On
Although she was a little confused,
Loreta did as she was instructed and did not report for work for a month. She returned to work on
On
xxx
Complainant waited for respondent Xu in
the dining area. After waiting for about
two (2) hours, respondent Xu was nowhere.
Instead, it was Jiang Xue Qin a.k.a Annie Co, the Chinese wife of
respondent Xu, who arrived and after a short conversation between them, the
former frankly told complainant that she has to resign allegedly she is a mismatch
to respondent Xu according to the Feng Shui master and therefore she does not
fit to work (sic) with the respondents.
Surprised and shocked, complainant demanded of Jiang Xue Qin to issue a
letter of termination if it were the reason therefor.
Instead of a termination letter issued,
Jiang Xue Qin insisted for the complainant's resignation. But when complainant stood her ground, Jian
Xue Qin shouted invectives at her and told to leave the office immediately.
Respondent Xu did not show up but talked to
the complainant over the mobile phone and convinced her likewise to resign from
the company since there is no way to retain her because her aura unbalanced the area of employment
according to the Feng Shui, the Chinese spiritual art of placement. Hearing this from no lees than respondent Xu,
complainant left the office and went straight to this Office and filed the
present case on
Loreta also alleged that in the afternoon of that day,
TO
ALL EMPLOYEES OF
WE WOULD LIKE TO INFORM YOU THAT MS. LORIE TSE YUNG,
FORMER ADMINISTRATIVE OFFICER OF
ANY TRANSACTION MADE BY HER IS
NO LONGER A LIABILITY OF THE COMPANY.
(SGD.) THE MANAGEMENT [Italics were in red letters.][29]
The Court finds Loreta’s complaint credible. There is consistency in her pleadings and
evidence. In contrast, Wensha’s pleadings
and evidence, taken as a whole, suffer from inconsistency. Moreover, the affidavits of the employees
only pertain to petty matters that, to the Court’s mind, are not sufficient to
support Wensha’s alleged loss of trust and confidence. To be a valid cause for termination of
employment, the act or acts constituting breach of trust must have been done
intentionally, knowingly, and purposely; and they must be founded on clearly
established facts.
The CA decision is supported by evidence and logically flows
from a review of the records. Loreta’s narration of the events surrounding her
termination from employment was simple and straightforward. Her claims are more credible than the
affidavits which were clearly prepared as an afterthought.
More importantly, the records are bereft of evidence that
Loreta was duly informed of the charges against her and that she was given the
opportunity to respond to those charges prior to her dismissal. If there were indeed charges against Loreta
that Wensha had to investigate, then it should have informed her of those
charges and required her to explain her side.
Wensha should also have kept records of the investigation conducted
while Loreta was on leave. The law
requires that two notices be given to an employee prior to a valid termination:
the first notice is to inform the employee of the charges against her with a
warning that she may be terminated from her employment and giving her
reasonable opportunity within which to explain her side, and the second notice
is the notice to the employee that upon due consideration of all the
circumstances, she is being terminated from her employment.[30]
This is a requirement of due process and
clearly, Loreta did not receive any of those required notices.
We are in accord with the pronouncement of the CA that the
reinstatement of Loreta to her former position is no longer feasible in the light
of the strained relations between the parties.
Reinstatement, under the circumstances, would no longer be practical as
it would not be in the interest of both parties. Under the law and
jurisprudence, an illegally dismissed employee is entitled to two reliefs -
backwages and reinstatement, which are separate and distinct. If reinstatement
would only exacerbate the tension and further ruin the relations of the
employer and the employee, or if their relationship has been unduly strained
due to irreconcilable differences, particularly where the illegally dismissed
employee held a managerial or key position in the company, it would be prudent
to order payment of separation pay instead of reinstatement.[31]
In the case of Golden Ace Builders v. Talde,[32]
We wrote:
Under the doctrine of strained
relations, the payment of separation pay has been considered an acceptable
alternative to reinstatement when the latter option is no
longer desirable or viable. On the one hand, such payment liberates the
employee from what could be a highly oppressive work environment. On the
other, the payment releases the employer from the grossly unpalatable
obligation of maintaining in its employ a worker it could
no longer trust.
In the case at bench, the CA, upon its own assessment,
pronounced that the relations between petitioners and the respondent have
become strained because of her dismissal anchored on dubious charges. The respondent has not contested the finding. As she is not insisting on being reinstated,
she should be paid separation pay equivalent to one (1) month salary for every
year of service.[33] The CA, however, failed to decree such award
in the dispositive portion. This should be rectified.
Nevertheless, the Court finds merit in the argument of
petitioner Xu that the CA erred in ruling
that he is solidarily liable with Wensha.
Elementary is the rule that a corporation is invested by law
with a personality separate and distinct from those of the persons composing it
and from that of any other legal entity to which it may be related. “Mere ownership by a single stockholder or by
another corporation of all or nearly all of the capital stock of a corporation
is not of itself sufficient ground for disregarding the separate corporate
personality.”[34]
In labor cases, corporate directors and
officers may be held solidarily liable with the corporation for the termination
of employment only if done with malice or in bad faith.[35]
Bad faith does not connote bad judgment or negligence; it imports a dishonest
purpose or some moral obliquity and conscious doing of wrong; it means breach
of a known duty through some motive or interest or ill will; it partakes of the
nature of fraud.[36]
In the subject decision, the CA concluded that petitioner Xu and
Wensha are jointly and severally liable to Loreta.[37]
We have read the decision in its
entirety but simply failed to come across any finding of bad faith or malice on
the part of Xu. There is, therefore, no
justification for such a ruling. To
sustain such a finding, there should be an evidence on record that an officer or
director acted maliciously or in bad faith in terminating the services of an
employee.[38] Moreover, the finding or indication that the
dismissal was effected with malice or bad faith should be stated in the
decision itself.[39]
WHEREFORE, the petition is PARTIALLY GRANTED. The decretal portion of the May 28, 2008
Decision of the Court of Appeals, in CA-G.R. SP No. 98855, is hereby MODIFIED
to read as follows:
WHEREFORE, the
petition is GRANTED. Wensha Spa Center, Inc. is hereby ordered to pay Loreta T.
Yung her full backwages, other privileges, and benefits, or their monetary
equivalent, and separation pay reckoned from the date of her dismissal, September
1, 2004, up to the finality of this decision, plus damages in the amounts of
Fifty Thousand (P50,000.00) Pesos, as moral damages; Twenty Five Thousand
(P25,000.00) Pesos as exemplary damages; and Twenty Thousand (P20,000.00)
Pesos, as attorney’s fees. No costs.
SO ORDERED.
JOSE
CATRAL
Associate Justice
WE CONCUR:
ANTONIO T. CARPIO
Associate Justice
Chairperson
ANTONIO EDUARDO B. NACHURA DIOSDADO
M. PERALTA
Associate
Justice Associate
Justice
ROBERTO
A. ABAD
Associate Justice
A T T E S T A
T I O N
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,
Second Division
C E R T I F I C A T I O N
Pursuant to Section
13, Article VIII of the Constitution and the Division Chairperson’s
Attestation, 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’s Division.
RENATO C. CORONA
Chief Justice
[1] Rollo, pp. 47-63. Penned by Associate Justice Normandie B. Pizarro with the concurrence of Associate Justice Josefina Guevara-Salonga and Associate Justice Magdangal M. de Leon.
[2]
[3]
[4]
[5]
[6]
[7]
[8]
[9]
[10]
[11]
[12]
[13] Solid Development Corporation
Workers Association [SDCWA-UWP] v. Solid Development Corporation, G.R. No.
165995,
[14] National Bookstore, Inc. v. Court of Appeals, 428 Phil. 235 (2002).
[15] Rollo, p. 80.
[16]
[17]
[18]
[19] Garcia v. National Labor Relations Commission, 351 Phil. 960 (1998).
[20] Rollo, p. 117.
[21] Royal Crown Internationale v.
National Labor Relations Commission, G.R. No. 78085,
[22] Philippine Long Distance Telephone Company, Inc. v. Tiamson, G.R. Nos. 164684-85, November 11, 2005, 474 SCRA 761.
[23] Rollo, p. 141, NLRC Resolution dated
[24]
[25]
[26]
[27]
[28]
[29]
[30] Book V, Rule XXIII of the Omnibus Rules Implementing the Labor Code.
[31] Quijano v. Mercury Drug Corporation, 354 Phil. 112 (1998).
[32] G. R. No. 187200,
[33] Golden Ace Builders v. Talde, supra note 32.
[34] “G” Holdings, Inc. v. National Mines
and Allied Workers Union Local 103 (NAMAWU), G.R. No. 160236, October 16,
2009, 604 SCRA 73, 114 and Elcee Farms v. NLRC, G.R. No. 126428, January
25, 2007, 512 SCRA 602, 616-617.
[35] Petron Corporation v. NLRC, G. R. No. 154532, October 27, 2006, 505 SCRA 596.
[36] Elcee Farms v. NLRC, supra note 34.
[37] Rollo, p. 62.
[38] M+W Zander Philippines, Inc. and Rolf
Wiltschek v.
[39] See Alba v. Yupangco, G. R. No. 188233,