LABOR LAW REVIEW CASES SET 3 1

Sameer Overseas Placement vs. Gutierrez, G.R. No. 220030, Mar. c. Refund of Placement
18, 2019 Fee
PHP23,000.00

Airborne Maintenance vs. Egos, G.R. No. 222748, April 3, 2019
Pelagio vs. Philippine Transmarine Carriers, G.R. No. 231773, Mar.
11, 2019
Freyssinet Filipinas vs. Lapuz, G.R. No. 226722, Mar. 18, 2019
Pardillo vs. Bandojo, G.R. No. 224854, Mar. 27, 2019
SECOND DIVISION
[G.R. No. 220030. March 18, 2019.]
SAMEER OVERSEAS PLACEMENT
AGENCY, INC., petitioner, vs. JOSEFA
GUTIERREZ, respondent.
DECISION
REYES, J.C., JR., J p:
This is a Petition for Review 1 assailing the Decision 2
dated January 22, 2015 and the Resolution 3 dated August 5, 2015
of the Court of Appeals in CA-G.R. SP No. 130134. 4 The assailed
Decision had dismissed petitioner Sameer Overseas Placement
Agency, Inc.'s motion to quash the writ of execution issued in an
illegal dismissal case that had long been finally decided in favor of
respondent Josefa Gutierrez. The assailed Resolution denied
reconsideration.
Undisputed are the facts.
In 2001, petitioner Sameer Overseas Employment
Agency, Inc. (Sameer) deployed respondent Josefa Gutierrez
(Gutierrez), a registered Filipino nurse, to Ireland on a two-year
employment in a nursing home. The contract stipulated her salary
in the Irish Pound. After merely two months, however, she was
unceremoniously repatriated, urging her to file for unlawful
termination. In its Decision dated February 10, 2003, the Labor
Arbiter found for Gutierrez and declared Sameer 5 liable to pay the
money judgment 6 as follows:
WHEREFORE, premises
considered, judgment is hereby rendered:
3. declaring individual respondents
Rizalina Lamzon to be
properly impleaded; and to
be likewise personally liable
for this award; and
4. dismissing all other claims for lack
of merit.
SO ORDERED. 7
On appeal, the National Labor Relations Commission
(NLRC) reversed the Labor Arbiter's Decision and denied
reconsideration. Then, on certiorari, the Court of Appeals
reinstated the judgment of the Labor Arbiter. Sameer immediately
filed an appeal 8 before this Court which, however, was denied in
a minute resolution 9 and in a subsequent resolution 10 on motion
for reconsideration. Finally, the entry of judgment issued on
October 8, 2010. 11
On July 31, 2012, at the instance of Gutierrez, 12 the
Labor Arbiter issued a Writ of Execution 13 containing a re-
computation of the original monetary award and a conversion
thereof into the Euro currency. The writ materially reads:
NOW, THEREFORE, you are
hereby directed to proceed to the premises of
respondents Sameer Overseas Placement
Agency, Rizalina Lamzon and Irish Nursing
Home Organization Limited, located at Rizal
Tower, 4474 Singian Street corner Makati
Avenue, Makati City, Metro Manila, or
wherever they may be found in the Philippines,
to collect the total amount of TEN
THOUSAND FOUR HUNDRED FIFTY
THREE & 804/100 EUR (10,453.804 EUR)
or its Peso equivalent prevailing at the time of
actual payment representing the complainant's
monetary awards pursuant to the Decision
dated 10 February 2003, and to deposit the
same to the NLRC Cashier for disposition.
xxx xxx xxx
SO ORDERED. 14
Sameer moved to recall and/or quash the writ of
execution 15 believing that the Labor Arbiter, in converting the
award into Euro on execution, had illegally varied the terms of the
final and executory Decision in the termination case. The writ was
sustained in an Order dated December 12, 2012. 16 Then, on
January 18, 2013, Sameer filed with the NLRC a petition to annul
17 the December 12, 2012 Order and insisted on the nullification
of the writ. The NLRC dismissed said petition in a Decision dated
February 25, 2013. 18 ICHDca

1. finding the dismissal of complainant Upon denial of its motion for reconsideration, 19 Sameer
Josefa Docuyanan Gutierrez elevated the matter to the Court of Appeals on certiorari. 20 The
to be illegal; Court of Appeals dismissed the petition for lack of merit, 21 and
likewise denied reconsideration. 22
2. ordering respondents Sameer
Overseas Placement Agency, Hence, this petition.
Rizalina Lamzon and Irish Sameer posits that the Court of Appeals erred (a) in not
Nursing Home Organization finding grave abuse of discretion on the part of the Labor Arbiter
Limited to pay complainant when it changed the currency of the monetary award to Euro; (b) in
jointly and solidarily, the not finding grave abuse of discretion on the part of the NLRC when
following: the latter did not grant the petition to annul the December 12, 2012
a. Salary (2 1/2 mos.) Order; and (c) in validating the manner by which the monetary
2,083.02 Pounds award was converted from Irish Pound to the Euro. 23

b. Unexpired Portion (6 For her part, Josefa points out in her Comment 24 that
mos.) 6,250.02 the Euro currency had already replaced the Irish Pound in Ireland
Pounds (Payable in at the time the Decision in the illegal dismissal case became final
Philippine peso at and executory. She considers this change in currency as a
the rate of supervening fact or event that authorized the Labor Arbiter to make
exchange modifications on the money judgment even on execution. 25
prevailing at the Replying, Sameer advances the notion that a
time of payment) modification of the judgment is indeed allowed in exceptional
caITAC circumstances but not where the modification is made in a writ of
execution. 26 It reiterates the elementary rule that a writ of
execution must conform to the dispositive portion of the decision,

otherwise the execution is void if it is in excess of and beyond the
original judgment. 27
Verily, the focal issue to be addressed in this case is
whether or not the original monetary award in the final Decision
may, by the ensuing writ of execution, be legally re-computed and
translated from Irish Pound to the Euro. As this Court responds in
the affirmative, it hereby finds the subject writ of execution to be
fully in order.
We preface the disquisition with the necessary dissection
of the final judgment rendered in the unlawful termination case
between Sameer and Gutierrez.
Fundamental is the rule that the dispositive portion of a
judgment, order or decision is what determines and declares the
rights and obligations of the parties to a dispute as against each
other. It is the dispositive portion that must be enforced to make for
a valid execution, and a judgment must be implemented according
to its letter. Except in well-recognized exceptions, a final judgment,
order or decision may not be validly altered, amended or modified
even if it is meant to correct a perceptibly erroneous conclusion of
fact or law. This, because any insertion, change or addition to the
dispositive portion violates the rule on immutability of judgments.
28
A case for illegal dismissal or unlawful termination —
which is the underlying case in this petition — is one that relates
purely to the status of the parties. Hence, the decision or ruling
therein is essentially declaratory of the rights and obligations of the
parties, and the monetary award that flows from the declared status,
such as payment of separation pay and backwages, is but a
necessary and legal consequence of the said declaration. 29 A look
at the dispositive portion of affirmative decisions rendered in illegal
dismissal cases tells that it is always comprised of two distinct
parts: first is the definitive finding of illegal dismissal and the
incidental monetary awards sanctioned by law in such case and,
second, is the assessment and computation of what the first part of
the disposition has already established. The second part, being
merely a computation of what the first part of the decision has
already pronounced, may, by its nature, be re-computed. 30
The Court takes notice that Ireland joined the European
Union in January 1, 1973 31 and, in January 1999, became one of
the Euro Area member-states that began replacing their national
currencies with the Euro. 32 After its gradual adaptation to the new
economic and monetary regime, its national currency, the Irish
Pound, finally departed and ceased to be legal tender on February
9, 2002. 33 Inasmuch as the monetary award in this case has been
fixed in the Irish Pound but to be paid in its Philippine Peso
equivalent, the Labor Arbiter, in issuing the subject writ of
execution on July 31, 2012, has made a practical, consequential and
logical call when she re-computed and converted the final
Decision's money award into the prevailing currency that replaced
the previous — not to say demonitized and, hence, obsolete and
worthless currency, but still payable to Gutierrez in Philippine Peso
equivalent.
The power of the Labor Arbiter to make, at the first
instance, a computation of monetary award in an illegal dismissal
case is sanctioned by the NLRC Rules of Procedure. 34 Implied
from this original computation is its currency up to the finality of
the decision. 35 Indeed, on one hand, had the case purely involved
an employee's claim for a specific sum of money, the computation
would carry such a continuing currency that any adjustment or
change might only be on the interest that would run from the
finality of the decision until full satisfaction of the judgment
obligation. On the other hand, in a claim that relates to status, such
as in illegal dismissal cases, what is principally implemented is the
declaratory finding on the status, rights and obligations of the
parties, and the monetary consequence only follows as a mere
incidental component of said finding. 36 ASEcHI
That the Labor Arbiter has been impelled to make an
allowance for the conversion of the money award to happen inspite
of the demonitization of the Irish Pound, is well in accord with
Republic Act No. 8183. 37 This law authorizes obligations incurred
in foreign currency to be discharged in our local money at the
prevailing rate of exchange at the time of payment. In other words,
because it is just and fair to preserve the real value of the foreign
exchange-incurred obligation to the date of its payment, 38 it is just
as much legal and logical to take into account the fact that the
exchange rate at the time of execution was already measured in
terms of the Euro.
LABOR LAW REVIEW CASES SET 3 2
At any rate, Session Delights Ice Cream and Fast Foods
v. Court of Appeals 39 instructs that a re-computation of the
monetary award is indeed part of the law that is read into the
decision. The re-computation of the consequences of an illegal
dismissal, to accommodate the reliefs that continue to add on until
full satisfaction of the award, even upon execution of the decision
does not constitute an alteration or amendment of the final decision
being implemented. Indeed, the ruling on the illegality of the
dismissal stands, and only the computation of the monetary
consequences must adapt to changes albeit without running foul to
the principle of immutability of a final judgment. 40
With approval, we quote the observation made by the
Court of Appeals on this matter:
The Writ of Execution did not alter
the essential particulars of the judgment to be
executed. The original fallo provides that the
money judgment is payable in Philippine Peso
at the rate of exchange prevailing at the time of
payment. To be able to convert the said money
judgment from Irish Pound to Philippine Peso,
it is necessary to first convert it to Euro since
Irish Pound is no longer used as currency, and
from Euro to Philippine Peso, which is
ultimately the currency that the money
judgment was made payable in the judgment
sought to be executed. Hence, the writ of
execution did not deviate, but is all the more in
accordance with the final and executory
judgment. 41
Finally, Sameer likewise questions the validation given
by the Court of Appeals to the manner by which the Labor Arbiter
has come by the re-computation of the monetary award. Yet
inasmuch as it thereby would have this Court look into a deeply
technical matter which is best left to the sound judgment of the
labor tribunal below, we decline to address this issue further.
Suffice it to say that mathematical computations are painted in
jurisprudence as factual determinations 42 and, thus, generally
beyond the province of this Court, especially when supported by
substantial evidence and affirmed by the appellate court. 43 Well-
recognized exceptions 44 to this rule abound, but not one is
applicable in this instant petition.
WHEREFORE, the petition is DENIED.
SO ORDERED. ITAaHc
Carpio, Perlas-Bernabe, Caguioa and Lazaro-Javier,
JJ., concur.
||| (Sameer Overseas Placement Agency, Inc. v. Gutierrez, G.R. No.
220030, [March 18, 2019])
 LABOR LAW REVIEW CASES SET 3 3

SECOND DIVISION On June 04, 2012, the Labor Arbiter

rendered a decision dismissing the complaint
for illegal/constructive dismissal, the fallo of
[G.R. No. 222748. April 3, 2019.] which reads:
"WHEREFOR
AIRBORNE MAINTENANCE AND ALLIED E, premises considered,
SERVICES, INC., petitioner, vs. ARNULFO judgment is hereby
M. EGOS, respondent. rendered DISMISSING
the instant complaint for
lack of merit. CAIHTE

DECISION SO
ORDERED."
On appeal to the NLRC, private
respondent reiterated that he was
CAGUIOA, J p: constructively/illegally dismissed by Airborne.
He pointed out that he made several follow-ups
Before the Court is a petition for review on certiorari 1 since July 1, 2011, but Airborne merely
(Petition) under Rule 45 of the Rules of Court assailing the ignored him, and since then, he was not given
Decision 2 dated August 28, 2015 and Resolution 3 dated January a new assignment. Private respondent further
22, 2016 of the Court of Appeals (CA) in CA-G.R. SP No. 130466. argued that the letters were mere afterthoughts
The CA affirmed the Decision 4 dated December 27, 2012 and since Airborne was already aware of the illegal
Resolution dated April 10, 2013 of the National Labor Relations dismissal complaint prior to the sending of the
Commission (NLRC) in NLRC LAC No. 07-002187-12 (NLRC said letters; that the same could not possibly
NCR Case No. 00-08-11936-11), which found that respondent was reach him because his address was incomplete
constructively dismissed. and such mistake was intentionally done for
him not to receive the letters; and that he left
his cellphone number with one Christine Solis,
Facts Airborne's Administrative Officer, but he
never received a call from Airborne.
Airborne countered that private
The facts, as narrated by the CA, are as follows:
respondent introduced for the first time on
On April 9, 1992, petitioners appeal not only new factual allegations but also
Airborne Maintenance and Allied Services, spurious, fabricated and self-serving evidence
Inc. and Francis T. Ching (Airborne), a which should not be given credence.
company engaged in providing manpower
On December 27, 2012, public
services to various clients, hired the services of
respondent NLRC rendered a decision
private respondent as Janitor. He was assigned
reversing the findings of the Labor Arbiter and
at the Balintawak Branch of Meralco, a client
declaring private respondent to have been
of Airborne.
constructively/illegally dismissed. The
Almost twenty years thereafter, or on dispositive portion of which reads:
June 30, 2011, the contract between Airborne
"WHEREFOR
and Meralco-Balintawak Branch expired and a
E, premises considered,
new contract was awarded to Landbees
the appeal is GRANTED.
Corporation, and the latter absorbed all
The Decision appealed
employees of Airborne except private
from is REVERSED and
respondent, who allegedly had a heart ailment.
SET ASIDE, and a new
Private respondent consulted another doctor
one issued declaring the
and, based on the medical result, he was
respondents guilty of
declared in good health and fit to work. He
illegal dismissal.
showed the duly issued medical certificate to
Airborne but the same was disregarded. Accordingly,
respondents are ordered to
Private respondent also reported for
pay complainant the
work but was just ignored by Airborne and was
following:
told that there was no work available for him.
Feeling aggrieved, he filed a complaint for 1. Backwages
constructive/illegal dismissal on August 05,
2011. 2. Separation pay

Airborne, on the other hand, insisted SO

that private respondent was never dismissed
from service. It claimed: 1) that when [its]
contract with Meralco-Balintawak Branch was
terminated, it directed all its employees
including private respondent to report to its
office for reposting; 2) that when private
respondent failed to do so, it sent a letter dated
August 12, 2011 at private respondent's last
known address directing him to report to his x
x x new assignment at Meralco
Commonwealth Business Center; 3) that said
letter, however, was returned to sender with a
notation "RTS unknown"; 4) that another letter
dated September 21, 2011 was sent to private
respondent at his last known address reiterating
the previous directive; and 5) that the same was
again returned with a notation "RTS
unknown."
ORDERED." 5
Petitioner filed a petition for certiorari with the CA,
which affirmed the Decision of the NLRC. The dispositive portion
of the CA Decision states:
WHEREFORE, premises
considered, the Decision dated December 27,
2012 and Resolution dated April 10, 2013 of
the National Labor Relations Commission,
Second Division in NLRC NCR LAC No. 07-
002187-12 (NLRC NCR Case No. 08-11936-
11) are hereby AFFIRMED.
SO ORDERED. 6
Petitioner moved for reconsideration, but this was
denied.
Hence, this Petition. Respondent filed his Comment 7
and, in turn, petitioner filed its Reply. 8

Issues
The issues raised in the Petition are as follows:
I that x x x respondent made several follow-ups
CONTRARY TO EXISTING
JURISPRUDENCE, THE COURT OF
APPEALS[,] WITH DUE RESPECT[,]
COMMITTED GRAVE ABUSE OF
DISCRETION AMOUNTING TO LACK OF
OR IN EXCESS OF JURISDICTION WHEN
IT AFFIRMED THE DECISION OF THE
NLRC DECLARING THAT PRIVATE
RESPONDENT WAS CONSTRUCTIVELY
DISMISSED AND WORSE BY MAKING
AN ASSUMPTION THAT PETITIONER
CLAIMED ABANDONMENT AS A
DEFENSE[.]
II
THE COURT OF APPEALS SERIOUSLY
ERRED WHEN IT DISMISSED
PETITIONER'S PETITION FOR
[CERTIORARI] RELYING SOLELY ON
THE ERRONEOUS CONCLUSIONS OF
FACT AND LAW MADE BY THE NLRC
DESPITE THE CLEAR AND
UNEQUIVOCAL JURISPRUDENCE ON
THE MATTER. 9
The Court's Ruling
The Petition is denied.
A review of the submissions of the parties shows that the
CA was correct in affirming the NLRC's ruling that respondent was
constructively dismissed. The CA ruled as follows: HEITAD
In cases of termination of
employees, the well-entrenched policy is that
no worker shall be dismissed except for just or
authorized cause provided by law and after due
process. Dismissals of employees have two
facets: first, the legality of the act of dismissal,
which constitutes substantive due process; and
second, the legality in the manner of dismissal,
which constitutes procedural due process.
xxx xxx xxx
Clearly, the failure to observe the
twin requisites of notice and hearing not only
makes the dismissal of an employee illegal
regardless of his alleged violation, but is also
violative of the employee's right to due
process.
xxx xxx xxx
In this case, it is beyond cavil that
none of the foregoing mandatory provisions of
the labor law were complied with by Airborne.
xxx xxx xxx
To buttress its contention that x x x
respondent abandoned his work, Airborne
alleged that it sent letters/notices to private
respondent directing him to report for work.
Nonetheless, no iota of evidence was presented
by Airborne sufficiently showing that the
letters/notices dated August 12, 2011 and dated
September 21, 2011 were actually received by
x x x respondent. In fact, said letters/notices
were returned with a notation "RTS unknown"
inasmuch as x x x respondent's address was
incomplete and such was intentionally done for
the latter not to receive said letters/notices.
As correctly observed by public
respondent NLRC, the letters/notices were
mere afterthoughts since Airborne was already
LABOR LAW REVIEW CASES SET 3 4
aware of the filing of the illegal dismissal
complaint prior to the sending of the said
letters/notices.
Corollary thereto, it must be stressed
since July 1, 2011, but Airborne did not give
him a new assignment. Moreover, x x x
respondent gave his cellphone number with
Christine Solis, Airborne's Administrative
Officer, but to no avail. 10
On the other hand, the NLRC found that:
After a careful review of the records
of the case, We find the appeal impressed with
merit.
Complainant [respondent herein]
claims that respondents [petitioner herein] told
him that he had a heart ailment, thus, he could
not be absorbed for continued employment. He
consulted Dr. Rina Porciuncula of the Our
Lady of the Angels Clinic in Sta. Maria,
Bulacan. The doctor declared him fit to work
(rollo, pp. 25-27).
We find credence on his allegation
that respondents denied him employment
because he had a heart ailment. Nonetheless,
despite the declaration that he was fit to work,
the respondents still did not give him any
assignment.
The complainant is a mere janitor,
and to earn a living, he had to undergo the
medical examination. He exerted effort and
spent money to prove to respondents that he
was capable of working.
To give semblance of legality to their
act of not giving him an assignment, after the
filing of the complaint for constructive
dismissal, respondents sent him two (2) letters
with incomplete address. The sending of the
letters were a mere afterthoughts (sic).
The Supreme Court, in Skippers
United Pacific, Inc. vs. NLRC, G.R. No.
148893, July 12, 2006 ruled that "Afterthought
cannot be given weight or credibility."
This Commission is not convinced
that they had the sincerity to give him a new
assignment. There is reason to believe that the
incomplete address was intentionally done in
order that complainant would not receive it,
and respondents can put up as a defense their
intention to have the complainant reposted by
sending the two (2) letters. 11
Petitioner, however, argues that there was no dismissal to
speak of as it had placed respondent on floating status when the
contract with Meralco was terminated. 12
Although this was not discussed by both the CA and the
NLRC, petitioner claims that it had valid grounds to suspend its
business operation or undertaking for a period of six months and
place its employees in a floating status during that period in
accordance with Article 301, formerly Article 286, of the Labor
Code. Article 301 states: ATICcS
ART. 301 [286]. When Employment
Not Deemed Terminated. — The bona fide
suspension of the operation of a business or
undertaking for a period not exceeding six (6)
months, or the fulfilment (sic) by the employee
of a military or civic duty shall not terminate
employment. In all such cases, the employer
shall reinstate the employee to his former
position without loss of seniority rights if he
indicates his desire to resume his work not later
than one (1) month from the resumption of
operations of his employer or from his relief
from the military or civic duty.
 LABOR LAW REVIEW CASES SET 3 5

The Court finds that petitioner failed to prove that the Also, not only did petitioner fail to prove it had valid
termination of the contract with Meralco resulted in a bona fide grounds to place respondent on a floating status, but the NLRC and
suspension of its business operations so as to validly place the CA both correctly found that respondent even had to ask for a
respondent in a floating status. new assignment from petitioner, but this was unheeded. Further,
when respondent filed the complaint on August 5, 2011, petitioner,
The suspension of employment under Article 301 of the as an afterthought, subsequently sent notices/letters to respondent
Labor Code is only temporary and should not exceed six months, directing him to report to work. These, however, were not received
as the Court explained in PT & T Corp. v. National Labor Relations by respondent as the address was incomplete.
Commission: 13
In Morales v. Harbour Centre Port Terminal, Inc., 18 the
x x x Article 286 [now Article 301] Court defined constructive dismissal as a dismissal in disguise as it
may be applied but only by analogy to set a is an act amounting to dismissal but made to appear as if it were
specific period that employees may remain not, thus:
temporarily laid-off or in floating status. Six
months is the period set by law that the Constructive dismissal exists where
operation of a business or undertaking may be there is cessation of work because "continued
suspended thereby suspending the employment is rendered impossible,
employment of the employees concerned. The unreasonable or unlikely, as an offer involving
temporary lay-off wherein the employees a demotion in rank or a diminution in pay" and
likewise cease to work should also not last other benefits. Aptly called a dismissal in
longer than six months. After six months, the disguise or an act amounting to dismissal but
employees should either be recalled to work or made to appear as if it were not, constructive
permanently retrenched following the dismissal may, likewise, exist if an act of clear
requirements of the law, and that failing to discrimination, insensibility, or disdain by an
comply with this would be tantamount to employer becomes so unbearable on the part of
dismissing the employees and the employer the employee that it could foreclose any choice
would thus be liable for such dismissal. 14 by him except to forego his continued
employment. x x x 19 (Citations omitted)
In implementing this measure, jurisprudence has set that
the employer should notify the Department of Labor and Here, the totality of the foregoing circumstances shows
Employment (DOLE) and the affected employee, at least one that petitioner's acts of not informing respondent and the DOLE of
month prior to the intended date of suspension of business the suspension of its operations, failing to prove the bona fide
operations. 15 An employer must also prove the existence of a clear suspension of its business or undertaking, ignoring respondent's
and compelling economic reason for the temporary shutdown of its follow-ups on a new assignment, and belated sending of
business or undertaking and that there were no available posts to letters/notices which were returned to it, were done to make it
which the affected employee could be assigned. The Court appear as if respondent had not been dismissed. These acts,
explained in Lopez v. Irvine Construction Corp. 16 as follows: however, clearly amounted to a dismissal, for which petitioner is
liable.
In this case, Irvine failed to prove
compliance with the parameters of Article 286 WHEREFORE, premises considered, the Petition is
of the Labor Code. As the records would show, DENIED. The Decision dated August 28, 2015 and Resolution
it merely completed one of its numerous dated January 22, 2016 of the Court of Appeals in CA-G.R. SP No.
construction projects which does not, by and of 130466 are AFFIRMED. TIADCc
itself, amount to a bona fide suspension of
business operations or undertaking. In SO ORDERED.
invoking Article 286 of the Labor Code, the ||| (Airborne Maintenance and Allied Services, Inc. v. Egos, G.R. No.
paramount consideration should be the dire 222748, [April 3, 2019])
exigency of the business of the employer that
compels it to put some of its employees
temporarily out of work. This means that the
employer should be able to prove that it is
faced with a clear and compelling economic
reason which reasonably forces it to
temporarily shut down its business operations
or a particular undertaking, incidentally
resulting to the temporary lay-off of its
employees.
Due to the grim economic
consequences to the employee, case law states
that the employer should also bear the
burden of proving that there are no posts
available to which the employee temporarily
out of work can be assigned. Thus, in the case
of Mobile Protective & Detective Agency v.
Ompad, the Court found that the security
guards therein were constructively dismissed
considering that their employer was not able to
show any dire exigency justifying the latter's
failure to give said employees any further
assignment x x x. 17 (Citations omitted;
emphasis and underscoring in original)
Here, a review of the submissions of the parties shows
that petitioner failed to show compliance with the notice
requirement to the DOLE and respondent.
Making matters worse for petitioner, it also failed to
prove that after the termination of its contract with Meralco it was
faced with a clear and compelling economic reason to temporarily
shut down its operations or a particular undertaking. It also failed
to show that there were no available posts to which respondent
could be assigned.

SECOND DIVISION
[G.R. No. 231773. March 11, 2019.]
CESAR C. PELAGIO,petitioner,vs.
PHILIPPINE TRANSMARINE CARRIERS,
INC.,CARLOS SALINAS, and
NORWEGIAN CREW MANAGEMENT
A/S,respondents.
DECISION
PERLAS-BERNABE, J p:
Before the Court is a petition for review on certiorari 1
filed by petitioner Cesar C. Pelagio (Pelagio) assailing the Decision
2 dated January 16, 2017 and the Resolution 3 dated May 22, 2017
of the Court of Appeals (CA) in CA-G.R. SP No. 122771, which
annulled and set aside the Decision 4 dated August 24, 2011 and
the Resolution 5 dated October 4, 2011 of the National Labor
Relations Commission (NLRC) in NLRC-LAC Case No. M-05-
000458-11, and accordingly, reinstated the Decision 6 dated April
29, 2011 of the Labor Arbiter (LA) awarding Pelagio the amount
of US$13,437.00 representing permanent partial disability benefits.
The Facts
Respondent Philippine Transmarine Carriers, Inc.
(PTCI) for and on behalf of its foreign principal, Norwegian Crew
Management A/S, hired Pelagio as a Motorman on board the vessel
M/V Drive Mahone for a period of six (6) months, under a
Philippine Overseas Employment Administration (POEA)-
approved contract of employment 7 dated September 29, 2009 and
a collective bargaining agreement 8 (CBA) between Norwegian
Crew Management A/S and Associated Marine Officers' and
Seamen's Union of the Philippines. After being declared fit for
employment, 9 Pelagio boarded M/V Drive Mahone on November
3, 2009. 10
Sometime in February 2010, Pelagio experienced
difficulty in breathing and some pains on his nape, lower back, and
joints while at work. Pelagio was then referred to a port doctor in
Said, Egypt where he was diagnosed with "Myositis" 11 and
declared unfit to work. 12 On March 2, 2010, Pelagio was
repatriated back to the Philippines for further medical treatment,
and thereafter, promptly sought the medical attention of the
company-designated physician, Dr. Roberto Lim, at Metropolitan
Medical Center. 13
After a series of medical and laboratory examinations, 14
including chest x-ray, pulmonary function tests,
electroencephalogram, and other related physical examinations,
Pelagio was finally diagnosed with Carpal Tunnel Syndrome,
Bilateral L5-S1 Radiculopathy, Mild Degenerative Changes, and
Lumbosacral Spine 15 with an interim assessment of a Grade 11
disability rating — "slight loss of lifting power of the trunk." 16
On August 18, 2010, Pelagio sought a second opinion
from a private orthopedic surgery physician, Dr. Manuel Fidel M.
Magtira (Dr. Magtira),who assessed him with a Grade 8 disability
— moderate rigidity or two-thirds loss of motion or lifting power
of the trunk — and declared him "permanently UNFIT TO WORK
in any capacity at his previous occupation." 17 CAIHTE
Pelagio then sought to avail of permanent total disability
benefits from respondents PTCI, Carlos Salinas, and Norwegian
Crew Management A/S (respondents),to no avail. Hence, he filed a
claim 18 for permanent total disability benefits, reimbursement of
medical expenses, illness allowance, damages, and attorney's fees
against petitioners before the Arbitration Branch of the NLRC,
docketed as NLRC-NCR No. (M) 09-13299-10. Essentially,
Pelagio contends that his inability to work for more than 120 days
from repatriation entitles him to permanent total disability benefits.
19
LABOR LAW REVIEW CASES SET 3 6
For their part, 20 respondents countered that Pelagio is
not entitled to permanent total disability benefits, considering that
the independent physician, Dr. Magtira, merely assessed him with
a Grade 8 impediment. In this relation, respondents likewise
claimed that on August 5, 2010, the company-designated physician
assessed Pelagio with a Grade 11 disability — slight loss of lifting
power of the trunk (August 5, 2010 Medical Report).21 In view of
the conflicting findings of the company-designated and the
independent physicians, respondents suggested that they seek a
third mutually-appointed doctor to comply with the provisions of
the POEA Standard Employment Contract, but Pelagio refused.
Finally, respondents averred that they offered Pelagio the amount
of US$13,437.00, the corresponding benefit to a Grade 11
impediment pursuant to the CBA, but he rejected such offer. 22
The LA Ruling
In a Decision 23 dated April 29, 2011, the LA found
Pelagio to be suffering from a permanent partial disability, and
accordingly, ordered respondents to jointly and solidarily pay him
the amount of US$13,437.00. 24 The LA ruled that Pelagio's mere
inability to work for 120 days from his repatriation did not ipso
facto mean that he is suffering from a permanent total disability,
especially in view of the disability assessments given by both the
company-designated and the independent physicians. On this note,
the LA gave weight to the findings of the company-designated
physician that Pelagio was suffering from a Grade 11 impediment,
and thus, must only be awarded disability benefits corresponding
thereto. 25
Dissatisfied, Pelagio appealed to the NLRC. 26
The NLRC Ruling
In a Decision 27 dated August 24, 2011, the NLRC
reversed and set aside the LA ruling, and accordingly, awarded
Pelagio the amounts of US$70,000.00 representing permanent total
disability benefits and US$7,000.00 as attorney's fees, or a total of
US$77,000.00, at their peso equivalent at the time of actual
payment. 28
The NLRC found that in the absence of the purported
August 5, 2010 Medical Report in the case records, there is nothing
that would support respondents' claim that the company-designated
physician indeed issued Pelagio a final disability rating of Grade
11. Thus, the NLRC deemed that there was no final assessment
made on Pelagio. In view thereof, the NLRC ruled that Pelagio's
disability went beyond 240 days without a declaration that he is fit
to resume work or an assessment of disability rating, and as such,
he is already entitled to permanent total disability benefits as stated
under the CBA. 29
Respondents filed a motion for reconsideration, 30
attaching thereto a copy of the August 5, 2010 Medical Report.
However, the same was denied in a Resolution 31 dated October 4,
2011. Aggrieved, respondents filed a petition for certiorari before
the CA. 32
The CA Ruling
In a Decision 33 dated January 16, 2017, the CA annulled
the NLRC ruling and reinstated that of the LA. It opined that the
company-designated physician indeed gave Pelagio a disability
rating of Grade 11 within 240 days from his repatriation, as evinced
by the July 27, 2010 Medical Report 34 which was later on affirmed
by the August 5, 2010 Medical Report. Hence, the CA concluded
that the company-designated physician's findings should prevail
considering that he extensively examined and treated Pelagio's
medical condition. 35
Dissatisfied, Pelagio moved for reconsideration, 36 but
was denied in a Resolution 37 dated May 22, 2017; hence, this
petition.
The Issue before the Court

The sole issue for the Court's resolution is whether or not
the CA correctly reinstated the LA ruling which only deemed
Pelagio to be suffering from a Grade 11 impediment, and must only
receive permanent partial disability benefits corresponding thereto.
HEITAD
The Court's Ruling
The petition is meritorious.
"Preliminarily, the Court stresses the distinct approach in
reviewing a CA's ruling in a labor case. In a Rule 45 review, the
Court examines the correctness of the CA's Decision in contrast
with the review of jurisdictional errors under Rule 65. Furthermore,
Rule 45 limits the review to questions of law. In ruling for legal
correctness, the Court views the CA Decision in the same context
that the petition for certiorari was presented to the CA. Hence, the
Court has to examine the CA's Decision from the prism of whether
the CA correctly determined the presence or absence of grave abuse
of discretion in the NLRC decision." 38
"Case law states that grave abuse of discretion connotes
a capricious and whimsical exercise of judgment, done in a despotic
manner by reason of passion or personal hostility, the character of
which being so patent and gross as to amount to an evasion of
positive duty or to a virtual refusal to perform the duty enjoined by
or to act at all in contemplation of law." 39
"In labor cases, grave abuse of discretion may be ascribed
to the NLRC when its findings and conclusions are not supported
by substantial evidence, which refers to that amount of relevant
evidence that a reasonable mind might accept as adequate to justify
a conclusion. Thus, if the NLRC's ruling has basis in the evidence
and the applicable law and jurisprudence, then no grave abuse of
discretion exists and the CA should so declare and, accordingly,
dismiss the petition." 40
Guided by the foregoing considerations, the Court finds
that the CA erred in ascribing grave abuse of discretion on the part
of the NLRC, as its finding that Pelagio is entitled to permanent
and total disability benefits is in accord with the evidence on
record, as well as settled legal principles of labor law.
In Jebsens Maritime, Inc. v. Rapiz,41 the Court explained
that a seafarer's failure to obtain any gainful employment for more
than 120 days after his medical repatriation does not ipso facto
deem his disability to be permanent and total as the company
designated physician may be given an additional 120 days, or a
total of 240 days from such repatriation, to give the seafarer further
treatment, and thereafter, make a declaration as to the nature of the
latter's disability. 42 It was then clarified, however, that for the
company-designated physician to avail of the extended 240-day
period, he must first perform some significant act to justify an
extension (e.g.,that the illness still requires medical attendance
beyond the initial 120 days but not to exceed 240 days);otherwise,
the seafarer's disability shall be conclusively presumed to be
permanent and total. 43 Hence, it reiterated the guidelines that
govern seafarers' claims for permanent and total disability benefits,
to wit:
1. The company-designated physician must
issue a final medical assessment on the
seafarer's disability grading within a period of
120 days from the time the seafarer reported to
him;
2. If the company-designated physician fails to
give his assessment within the period of 120
days, without any justifiable reason, then the
seafarer's disability becomes permanent and
total;
3. If the company-designated physician fails to
give his assessment within the period of 120
days with a sufficient justification
(e.g.,seafarer required further medical
treatment or seafarer was uncooperative),then
the period of diagnosis and treatment shall be
extended to 240 days. The employer has the
burden to prove that the company-designated
physician has sufficient justification to extend
the period; and
LABOR LAW REVIEW CASES SET 3 7
4. If the company-designated physician still
fails to give his assessment within the
extended period of 240 days, then the
seafarer's disability becomes permanent
and total, regardless of any justification.44
(Emphasis and underscoring supplied)
Otherwise stated, the company-designated physician is
required to issue a final and definite assessment of the seafarer's
disability rating within the aforesaid 120/240-day period; 45
otherwise, the opinions of the company-designated and the
independent physicians are rendered irrelevant because the
seafarer is already conclusively presumed to be suffering from a
permanent and total disability, and thus, is entitled to the benefits
corresponding thereto. 46 ATICcS
To recapitulate, the CA's finding that the company-
designated physician gave Pelagio a disability rating is largely
based on the July 27, 2010 Medical Report 47 which was seconded
by the August 5, 2010 Medical Report, 48 which respondents claim
to contain the company-designated physician's final disability
grading of Pelagio's condition. 49 However, a more circumspect
review of these documents show that these do not constitute the
final and definite assessment required by law, considering that: (a)
the July 27, 2010 Medical Report expressly provided that the
findings therein are only interim; 50 whereas (b) the August 5, 2010
Medical Report only provided for a "potential disability grading."
51
Besides, even assuming arguendo that the August 5,
2010 Medical Report indeed contains Pelagio's final disability
grading as posited by respondents, it must be noted that the same
was belatedly adduced in evidence when it was attached to
respondents' motion for reconsideration before the NLRC, even if
it appears to be readily available. Case law instructs that "while
strict compliance to technical rules is not required in labor cases,
liberal policy should still be pursuant to equitable principles of law.
In this regard, belated submission of evidence may be allowed only
if the delay in its presentation is sufficiently justified; the evidence
adduced is undeniably material to the cause of a party; and the
subject evidence should sufficiently prove the allegations sought to
be established." 52 Here, respondents did not explain the reasons
for their failure to present the August 5, 2010 Medical Report at the
earliest opportunity, and it was only after the NLRC rendered an
unfavorable decision that the same was presented. Verily,
respondents' belated submission thereof without any explanation
casts doubt on its credibility especially since it does not appear to
be a newly discovered evidence. 53
In the absence of a final and definite disability
assessment of the company-designated physician, Pelagio is
conclusively presumed to be suffering from a permanent and total
disability, and thus, is entitled to the benefits corresponding thereto.
In this light, the Court deems it proper to reverse the CA ruling and
reinstate that of the NLRC, with modification imposing on the
monetary awards due to Pelagio legal interest of six percent (6%)
per annum from finality of this Decision until full payment, in
accordance with prevailing jurisprudence. 54
WHEREFORE,the petition is GRANTED.The
Decision dated January 16, 2017 and the Resolution dated May 22,
2017 of the Court of Appeals (CA) in CA-G.R. SP No. 122771 are
REVERSED and SET ASIDE.Accordingly, the Decision dated
August 24, 2011 and the Resolution dated October 4, 2011 of the
National Labor Relations Commission in NLRC-LAC Case No. M-
05-000458-11, which awarded petitioner Cesar C. Pelagio the
amounts of US$70,000.00 representing permanent total disability
benefits and US$7,000.00 as attorney's fees, or a total of
US$77,000.00, at their peso equivalent at the time of actual
payment, are hereby REINSTATED,with MODIFICATION
imposing on said awards legal interest of six percent (6%) per
annum from finality of this Decision until full payment.
SO ORDERED.
Carpio, Caguioa, J.C. Reyes, Jr. and Lazaro-Javier,
JJ.,concur.
||| (Pelagio v. Philippine Transmarine Carriers, Inc., G.R. No. 231773,
[March 11, 2019])

SECOND DIVISION
[G.R. No. 226722. March 18, 2019.]
FREYSSINET FILIPINAS CORPORATION
(now FREY-FIL CORPORATION), ERIC A.
CRUZ, GAUDENCIO S. REYES, AND
CARLOTA R. SATORRE, petitioners, vs.
AMADO R. LAPUZ, respondent.
DECISION
PERLAS-BERNABE, J p:
Assailed in this petition for review on certiorari 1 are the
Decision 2 dated April 20, 2016 and the Resolution 3 dated August
23, 2016 of the Court of Appeals (CA) in CA-G.R. SP. No. 136935,
which reversed and set aside the Resolutions dated April 30, 2014
4 and June 25, 2014 5 of the National Labor Relations Commission
(NLRC) in NLRC LAC No. 04-000894-14 and instead, reinstated
the Decision 6 dated January 26, 2014 of the Labor Arbiter (LA) in
NLRC Case No. RAB III-01-18500-12 declaring that respondent
Amado R. Lapuz (respondent) was a regular employee and that his
dismissal was illegal.
The Facts
Respondent Amado R. Lapuz (respondent) worked as
warehouse supervisor for petitioner Freyssinet Filipinas
Corporation (FFC), now Frey-Fil Corporation, a domestic
corporation engaged in the business of general construction, pre-
stressed, post-tensioning, among others. 7 Respondent claimed that
he commenced work for FFC since 1977 under the latter's previous
company names, particularly: (a) FF Interior from 1977 to 1982,
(b) Freyssinet Post Tensioning System Philippines, Inc. (FPTSPI)
or Filsystem from 1982 to 1999, and (c) FFC from 2006 8 to 2012.
9 Except for FPTSPI which was owned by one Philip Cruz, the
remaining firms were allegedly owned and operated by petitioner
Eric A. Cruz (Cruz). 10 Respondent was assigned at the different
projects of FFC, the last of which was at the Wharton Parksuite
Project in Binondo, Manila. 11
Sometime in December 2011, respondent averred that he
was verbally informed of his termination from work by the project
manager, respondent Gaudencio S. Reyes (Reyes), when he was
told "Hoy umalis ka na dyan" and no longer allowed to perform his
work and enter the premises. 12 This notwithstanding, respondent
continued to report at the project site until he received a notice 13
of termination dated January 5, 2012 and directed to secure his
clearance 14 from the HRD Department, which he complied.
Believing to have been dismissed without substantive and
procedural due process, 15 respondent filed a complaint 16 for
illegal dismissal with prayer for reinstatement and payment of
attorney's fees, against FFC, Cruz, Reyes, and one Carlota R.
Satorre (petitioners) before the NLRC, docketed as NLRC Case
No. RAB III 01-18500-12.
For their part, petitioners asserted that respondent started
working as warehouse supervisor for FFC only on April 11, 2007
under a project employment contract for its Texas Instruments
project located in Pampanga, which lasted until September 2008.
Thereafter, respondent was rehired on a per project basis, for the
following: (a) Robinson's Place project in Dumaguete City from
September 12, 2008 until February 26, 2010; (b) FFC's Calumpit
Plant project from March 7, 2010 until April 4, 2011; and (c)
Wharton Parksuite project from April 22, 2011 until the
termination of his contract on December 31, 2011. 17 In support
thereof, FFC submitted copies of respondent's project employment
contracts at his last assignment in Wharton Parksuite which showed
that his services were engaged intermittently for a fixed period of
one (1) or three (3) months only. 18 They further contended that
respondent's termination was also reported 19 to the Department of
Labor and Employment (DOLE) in accordance with Section 2.2 of
Department Order No. 19, Series of 1993 (D.O. No. 19-93). 20
Thus, they maintained that respondent was not illegally dismissed
as his project employment contract merely expired. 21 They further
averred that the corporate officers should not be held liable in view
of the separate personality of the corporation from its officers and
absent showing of bad faith on their part. 22
The LA Ruling
LABOR LAW REVIEW CASES SET 3 8
In a Decision 23 dated January 26, 2014, the LA declared
respondent to be a regular employee of FFC and as such, was
dismissed without just or authorized cause. The LA ruled that
petitioners' failure to adduce proof of the filing of termination
reports with the DOLE every time a project or phase was completed
is an indication that respondent was not a project employee.
Moreover, the LA noted that respondent has been employed as
warehouse supervisor for FFC since 1977, and that in such
capacity, performed tasks that were usually necessary or desirable
in the usual business of the company. 24 Accordingly, the LA
ordered petitioners to jointly and severally pay respondent
separation pay equivalent to one month pay for every year of
service since 1977 up to 2012 in the sum of P610,500.00, with full
backwages reckoned from his dismissal; moral and exemplary
damages in the amount P50,000.00 each; and ten percent (10%)
attorney's fees for having been compelled to litigate. 25
Dissatisfied, petitioners appealed 26 to the NLRC.
The NLRC Ruling
In a Resolution 27 dated April 30, 2014, the NLRC
reversed and set aside the LA's decision, holding that respondent
was a project employee whose services ended upon completion of
a specific project. It pointed out that FFC was primarily engaged in
the construction industry whose workers are hired for specific
phases of work in the project site, and that respondent was made
aware of the nature of his employment and the duration thereof. It
held that respondent's engagement as project employee was further
manifested by his identification card, clearance, project
employment contracts, and establishment termination report to the
DOLE. Since respondent's most recent project contract had already
ended, he cannot be said to have been illegally dismissed and thus,
was not entitled to backwages, separation pay and other benefits.
Finally, it found no basis to award damages there being no showing
that petitioners acted in bad faith in terminating respondents, as
well as attorney's fees. 28
Respondent's motion for reconsideration 29 was denied
in a Resolution 30 dated June 25, 2014. Aggrieved, respondent
elevated the matter to the CA via a petition for certiorari. 31
The CA Ruling
In a Decision 32 dated April 20, 2016, the CA reversed
and set aside the NLRC ruling and instead, reinstated the LA ruling,
33 finding respondent to be a regular employee of FFC as early as
1977. It did not give credence to petitioners' claim that FF Interior,
FPTSPI, and Filsystems were separate and distinct corporations
from FFC, noting that the said corporations were ran by the same
people and that the same merely evolved into different names from
its establishment in 1972 until its present name as FFC. The CA
agreed with the findings of the LA that petitioners' failure to
religiously report the termination of respondent's employment
contracts established that the latter was a regular employee, and that
the employment contracts were a mere after-thought in order to
escape from their legal obligation attached to regular employment.
34
Petitioners' motion for reconsideration 35 was denied in
a Resolution 36 dated August 23, 2016; hence, the instant petition.
The Issue Before the Court
The essential issue for the Court's resolution is whether
or not the CA erred in finding grave abuse of discretion on the part
of the NLRC.
The Court's Ruling
The petition is partly impressed with merit.
I.
To justify the grant of the extraordinary remedy of
certiorari, petitioners must satisfactorily show that the court or
quasi-judicial authority gravely abused the discretion conferred
upon it. Grave abuse of discretion connotes a capricious and
whimsical exercise of judgment, done in a despotic manner by
reason of passion or personal hostility, the character of which being

so patent and gross as to amount to an evasion of positive duty or
to a virtual refusal to perform the duty enjoined by or to act at all
in contemplation of law. 37 It has also been held that grave abuse
of discretion arises when a lower court or tribunal patently violates
the Constitution, the law or existing jurisprudence. 38
Tested against these considerations, the Court finds that
the CA committed no reversible error in granting respondent's
certiorari petition insofar as it ruled that respondent was a regular
— and not a project — employee.
Under Article 295 39 of the Labor Code, regular
employment exists when the employee is: (a) engaged to perform
activities that are usually necessary or desirable in the usual
business or trade of the employer; or (b) a casual employee whose
activities are not usually necessary or desirable in the employer's
usual business or trade, and has rendered at least one year of
service, whether continuous or broken, with respect to the activity
in which he is employed.
On the other hand, an employee is said to be under a
project employment when he is hired under a contract which
specifies that the employment will last only for a specific project
or undertaking the completion or termination of which is
determined at the time of his engagement. 40 Thus, for an
employee to be considered project-based, it is incumbent upon the
employer to prove 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 the employee was engaged for
such project. 41 When a project employee is assigned to a project
or phase thereof which begins and ends at determined or
determinable times, his services may be lawfully terminated at the
completion of such project or a phase thereof. 42
Notably, in GMA Network, Inc. v. Pabriga, 43 the Court
pointed out that if the particular job or undertaking is within the
regular or usual business of the employer company and it is not
identifiably distinct or separate from the other undertakings of the
company such that there is clearly a constant necessity for the
performance of the task in question, said job or undertaking should
not be considered a project. 44
In this case, respondent was supposedly engaged by FFC
as warehouse supervisor for its various projects, namely: (a) Texas
Instruments project in Pampanga from April 11, 2007 to September
2008; (b) Robinson's Place project in Dumaguete City from
September 12, 2008 until February 26, 2010; (c) FFC's Calumpit
Plant project from March 7, 2010 until April 4, 2011; and (d)
Wharton Parksuite project from April 22, 2011 until December 31,
2011. However, for the first three (3) projects, petitioners failed to
show that respondent was hired on a project basis and that he was
informed of the duration and scope of his work. In fact, no
employment contracts for the said projects were presented to
substantiate their claim. While the absence of a written contract
does not per se grant regular status to respondent, it is nonetheless
evidence that he was informed of the duration and scope of his work
and his status as project employee. 45
In addition, no termination reports for each completed
projects were shown to have been submitted by petitioners to the
DOLE as mandated under Section 2 (2.2) (e) 46 of Department
Order No. 19-93 and, in fact, it was only during respondent's last
assignment at the Wharton Parksuite project that they complied
with the directive. It bears stressing that the failure of an employer
to file a termination report with the DOLE every time a project or
a phase thereof is completed indicates that the workers hired were
not project employees. In Tomas Lao Construction v. NLRC, 47 the
Court ruled that "[t]he report of termination is one of the indicators
of project employment." 48
While petitioners did submit respondent's project
employment contracts for the Wharton Parksuite project, which
contracts in fact, specified the covered project and duration thereof,
the Court finds that the same are still insufficient to prove his status
as a project employee. A perusal of the subject contracts readily
reveals that respondent was repeatedly and successively re-hired as
warehouse supervisor for the Wharton Parksuite project eight (8)
times for the following periods, to wit: (a) July 1, 2010 to August
31, 2010, (b) September 1, 2010 to September 30, 2010, (c)
October 1, 2010 to October 31, 2010, (d) January 16, 2011 to
February 28, 2011, (e) March 1, 2011 to March 31, 2011, (f) June
1, 2011 to June 30, 2011, (g) July 1, 2011 to September 30, 2011,
and (h) October 1, 2011 to December 31, 2011. These
notwithstanding, petitioners, however, failed to show that
respondent's services were needed only for the period contracted
LABOR LAW REVIEW CASES SET 3 9
and that the particular phase or undertaking for which he has been
hired has been completed to warrant the termination of his
employment. On the contrary, respondent's successive re-hiring in
order to perform the same kind of work for the same project,
contract after contract — most of which were for a duration of one
(1) month only — reasonably shows that respondent's project
employment contracts were merely used by petitioners to
circumvent the law on tenurial security. Settled is the rule that when
periods have been imposed to preclude the acquisition of tenurial
security by the employee, they should be struck down as contrary
to public morals, good customs or public order. 49
Even on the assumption that respondent was a project
employee, the Court has held that an employment ceases to be co-
terminous with specific projects when the employee is
continuously rehired due to the demands of employer's business
and re-engaged for many more projects without interruption. 50 As
aptly pointed out in the case of Maraguinot, Jr. v NLRC, 51 once a
project or work pool employee has been: (1) continuously, as
opposed to intermittently, rehired by the same employer for the
same tasks or nature of tasks; and (2) these tasks are vital,
necessary, and indispensable to the usual business or trade of the
employer, then the employee must be deemed a regular
employee. 52 Indeed, while length of time is not the controlling
test for project employment, it is nonetheless vital in determining
if the employee was hired for a specific undertaking or tasked to
perform functions that are vital, necessary, and indispensable to the
usual business or trade of the employer. 53
Considering that the function of a warehouse supervisor
is no doubt vital, necessary, and desirable to the construction
business of petitioners, and it has been sufficiently shown that
respondent's work as such for the latter's various projects without
interruption since 2007 is necessary and desirable to petitioners'
construction business, the CA properly deemed respondent to be a
regular employee. To reiterate, where the employment of project
employees is extended long after the supposed project has been
finished, the employees are removed from the scope of project
employees and are considered regular employees. 54
As a regular employee, respondent is entitled to security
of tenure and may only be dismissed for just or authorized causes.
Thus, not having been dismissed for a valid and legal cause, the CA
was correct in declaring respondent to have been illegally
dismissed.
II.
However, the Court takes exception to the CA's finding
that respondent's employment with petitioners started in 1977
based on its flawed finding that FF Interior and FFC are one and
the same company.
In so ruling, the CA upheld the assertion that FF Interior,
FPTSPI/Filsystem, and FFC merely changed their names and that
all companies are managed and owned by the same people.
However, the CA's conclusion is belied by the records which reveal
that FFC originated from then Freyssinet (Davao), Inc., 55 that was
registered on February 28, 1994 before the SEC and issued SEC
Registration No. AS094-001909, 56 and thereafter re-named to
FFC 57 in 2002, and subsequently, to Frey-Fil Corporation in 2011.
58 On the other hand, FPTSPI is shown to have been registered
under SEC Registration No. ASO94-002261, 59 while Filsystems
Tower 1, Inc. is registered under SEC Registration No. ASO94-
00011538. 60 Clearly, having been issued separate certificates of
registration, the FFC, FPTSPI, and Filsystems Tower 1, Inc., are by
law deemed to be separate and distinct corporate personalities.
Moreover, it is well settled that the 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. 61 Neither is
the existence of interlocking directors, corporate officers, and
shareholders enough justification to pierce the veil of corporate
fiction in the absence of fraud or other public policy considerations.
62 It must be shown that the separate and distinct personalities of
the corporations are set up to justify a wrong, protect fraud, or
perpetrate a deception. 63 Hence, the wrongdoing must be clearly
and convincingly established by substantial evidence; it cannot be
presumed. Otherwise, an injustice that was never unintended may
result from an erroneous application. 64 Verily, no such evidence
was submitted by respondent in this respect.
 LABOR LAW REVIEW CASES SET 3 10

In addition, no less than respondent admitted that his SECOND DIVISION

employment with FPTSPI ceased in 1999 and that he was hired [G.R. No. 224854. March 27, 2019.]
anew by FFC only in 2006. 65 While respondent declared that he LUCITA S. PARDILLO, petitioner, vs. DR.
was employed by FFC on July 11, 2006 in his complaint, 66 no EVELYN DUCAY BANDOJO, OWNER
evidence was presented to substantiate the same. On the other hand, AND MEDICAL DIRECTOR OF E & R
respondent did not deny FFC's claim that he was hired as HOSPITAL, respondent.
warehouse supervisor by the latter in 2007 for its Texas Instruments DECISION
project in Pampanga. 67 Under the circumstances, the Court is CAGUIOA, J p:
inclined to believe that respondent was hired by FFC only on April
11, 2007 — and not on July 11, 2006 as claimed by him. Before the Court is a Petition for Review 1 on Certiorari
under Rule 45 of the Rules of Court, filed by Lucita S. Pardillo
Thus, since there was no basis for the CA to disregard the (Pardillo) against Dr. Evelyn Ducay Bandojo (Dr. Bandojo), owner
separate juridical personality of FFC under the doctrine of piercing of E & R Hospital in Iligan City, assailing the Decision 2 dated
the corporate veil, and considering further that respondent was September 17, 2015 and Resolution 3 dated May 4, 2016 of the
deemed a regular employee of FFC having been consistently hired Court of Appeals (CA) in CA-G.R. SP No. 05365-MIN which had
as warehouse supervisor since April 11, 2007, and terminated overturned the Decision 4 of the National Labor Relations
without a valid cause on January 5, 2012, the awards of backwages Commission (NLRC).
and separation pay in lieu of reinstatement 68 are in accord with
Article 294 69 of the Labor Code.
As to the liability of the impleaded corporate officers, the Facts
Court equally finds error on the part of the CA in holding them
jointly and severally liable to respondent. Case law states that to
The facts, as summarized by the CA, are quoted below:
hold a director or officer personally liable for corporate obligations,
two requisites must concur: (1) it must be alleged in the complaint Sometime in November of 1990, x x
that the director or officer assented to patently unlawful acts of the x Lucita S. Pardillo was hired as midwife of E
corporation or that the officer was guilty of gross negligence or bad & R Hospital and Pharmacy in Iligan City,
faith; and (2) there must be proof that the officer acted in bad faith. which is owned and managed by spouses Prof.
70 Here, the twin requirements of allegation and proof of bad faith Rogelio B. Bandojo and x x x Dr. Evelyn D.
necessary to hold the impleaded corporate officers liable for the Bandojo. In 1991, [Pardillo] was transferred to
monetary awards are clearly lacking. a new position as Billing Clerk/Cashier. In
2001, she was promoted and became the
Finally, with respect to the award of moral and
Business Office Manager and held such
exemplary damages, it is worthy to point out that moral damages
position until November 18, 2010 when her
are recoverable where the dismissal of the employee was attended
employment was terminated by [Dr. Bandojo].
by bad faith or fraud or constituted an act oppressive to labor, or
was done in a manner contrary to morals, good customs, or public According to [Pardillo], she was
policy, while exemplary damages may be awarded if the dismissal surprised when she received a Notice of
was effected in a wanton, oppressive or malevolent manner. 71 Termination on November 18, 2010 which
Apart from respondent's bare allegations, no evidence was reads:
presented to prove that his dismissal was attended with bad faith or
was done oppressively. To: Ms. Lucita S. Pardillo
From: The Medical
Except for the foregoing modifications, the CA Decision, Director
which ordered the reinstatement of the LA ruling, stands.
Subject: Notice of
WHEREFORE, the petition is PARTLY GRANTED. Termination of Service
The Decision dated April 20, 2016 and the Resolution dated August
23, 2016 of the Court of Appeals (CA) in CA-G.R. SP No. 136935 You are hereby
are hereby AFFIRMED with MODIFICATIONS, as follows: informed that your
services as Business
(a) petitioner Freyssinet Filipinas Office Manager will be
Corporation (now Frey-Fil Corporation) is terminated effective thirty
ordered to pay respondent Amado R. Lapuz his (30) days from receipt of
separation pay equivalent to one (1) month pay this memorandum.
per year of service reckoned from April 11,
2007 up to the finality of this Decision; Due to the
following causes:
(b) the corporate officers, petitioners
Eric A. Cruz, Gaudencio S. Reyes, and Carlota 1. Loss of confidence
R. Satorre, are absolved from liability; and 2. Habitual Tardiness
(c) e award of moral and exemplary 3. Texting insulting words to
damages are ordered deleted for lack of basis. me, your employer
The rest of the CA decision stands. 4. Uttering offensive words
SO ORDERED. against me, your
employer
Carpio, * Caguioa, J.C., Reyes, Jr. and Lazaro-Javier,
JJ., concur 5. Texting me, threatening to
kill me or any of
||| (Freyssinet Filipinas Corp. v. Lapuz, G.R. No. 226722, [March 18, my family
2019])
Your (sic) need
not report to work thirty
days from today but you
will still received(sic) your
salary equivalent to one
(1) month as if you were
on regular duty.
You are advised
to prepare all clearance as
required from all
terminated employees at
the end of your tour of
duty which is thirty (30)

days from receipt of this
notice. CAIHTE
For your proper
guidance.
(SGD) Evelyn D.
Bandojo, MD, DFM
Medical Director
On the other hand, x x x Dr. Bandojo
alleged that [Pardillo's] termination was
brought about by several infractions she
committed and her habitual tardiness totaling
to about 16,000 minutes.
[Dr. Bandojo] avers that E & R
Hospital suffered losses due to the negligence
of [Pardillo] in failing to process and send the
records of certain patients to PhilHealth for
refund of their paid claims. [Dr. Bandojo] cited
the case of a patient named Jamal Alim, whose
claim was not processed or sent to PhilHealth;
Moises Servano whose claim was returned to
E & R Hospital due to the lack of original
official receipt[;] and Stephen Chiu, a non-
PhilHealth patient who was discharged from
the hospital on September 6, 2007 with an
unsettled bill of Php5[,]968.00 and with no
promissory note on record.
Moreover, that sometime on August
2010, [Pardillo] allegedly tried to borrow, for
her personal use the hospital's "Pay to Cash"
check which was intended for the payment of
the newborn screening kits.
The proverbial last straw that broke
the camel's back was the incident on
September 27, 2010 when [Pardillo] reported
very late for work; specifically at past ten in the
morning. [Dr. Bandojo] caught Mrs. Natividad
Labadan, [Pardillo's] subordinate, punching
[Pardillo's] time card in the bundy clock
located at the pharmacy area.
Thus, on September 30, 2010, an
administrative investigation was conducted. In
the said investigation, [Pardillo] denied [the]
accusations against her.
Due to the alleged incessant breach
of trust exhibited by [Pardillo], [Dr. Bandojo]
issued the memorandum dated November 18,
2010 terminating the employment of [Pardillo]
as Business Office Manager of E & R Hospital.
On April 5, 2011, Pardillo filed a
Complaint for Illegal Dismissal with the Labor
Arbiter. x x x 5
Findings of the labor tribunals
In its Decision 6 dated October 24, 2011, Labor Arbiter
Nicodemus G. Palangan (LA) dismissed Pardillo's complaint for
lack of merit. The LA held that Pardillo was a managerial employee
whose employment may be terminated on the ground of loss of trust
and confidence. 7 The LA held that Pardillo committed several
infractions inimical to the business of Dr. Bandojo such as failing
to process PhilHealth refunds, allowing the release of a patient with
unpaid hospital bills without a promissory note, trying to take a
personal loan on the "pay to cash" check intended for payment of
newborn screening kits, and tardiness. The LA also found that Dr.
Bandojo had observed procedural due process in dismissing
Pardillo as an administrative hearing was conducted.
On appeal the NLRC, reversed and set aside the ruling of
the LA in its Decision dated July 31, 2012. The NLRC held that
Pardillo was dismissed without substantive and procedural due
process. Pardillo was able to explain the alleged infractions levelled
against her by Dr. Bandojo. With regard to patient Moises Servano,
he had died and his relatives could no longer find the original
receipt so that upon instruction of Dr. Bandojo, Pardillo did not
refile the claim to PhilHealth. 8 As to patient Jamal Alim, he had
no financial obligation to the hospital, a fact which was not
controverted by Dr. Bandojo. As regards to patient Adam Stephen
Chiu, his grand uncle Victor Chiu, hospital accountant, executed an
LABOR LAW REVIEW CASES SET 3 11
affidavit alleging that he was responsible for his nephew's
hospitalization and that the balance of his unpaid medical bills were
to be offset against his professional fees. 9 The NLRC concluded
that Pardillo caught the ire of Dr. Bandojo when the latter witnessed
Pardillo's subordinate Natividad Ladaban punched in her superior's
time card. The NLRC held that while such act was a violation of
the hospital's policies, it did not amount to the wilful breach of trust
that would justify dismissal from employment. The NLRC also
noted that during the time-card incident, Pardillo was actually
present in the hospital premises. This negated the perception that
she had the intention to be absent that day and directed her
subordinate to punch in her time card to make it appear that she was
present. 10 DETACa
On the issue of tardiness, the NLRC found that Pardillo
was able to explain the same. The NLRC noted a memorandum 11
dated October 30, 2010 issued by Dr. Bandojo to Pardillo stating
that her usual 8:00 A.M. to 12:00 noon; 1:00 P.M. to 5:00 P.M.
schedule will resume on November 1, 2010 in lieu of other
schedules granted or allowed previously. The NLRC held that the
memorandum bolstered Pardillo's claim that she was allowed to
arrive late because she first attended to outside activities related to
her functions like PhilHealth and bank transactions. The NLRC
ordered Pardillo's reinstatement with full backwages, inclusive of
allowances and other benefits and attorney's fees.
Dr. Bandojo filed a Motion for Reconsideration 12 (MR)
which was denied by the NLRC in its Decision 13 dated December
12, 2012. The NLRC however, modified its earlier Decision as to
the order of reinstatement. Pardillo had manifested that her
relationship with her former employer Dr. Bandojo had become
strained and prayed for separation pay in lieu of reinstatement. Dr.
Bandojo did not controvert this. Thus, the NLRC granted her prayer
for separation pay in lieu of reinstatement.
Aggrieved, Dr. Bandojo elevated the case to the CA via
petition for certiorari 14 under Rule 65 of the Rules of Court.
The CA Decision
The CA granted the petition. The CA held that Dr.
Bandojo was able to prove with substantial evidence that Pardillo's
termination was for a just cause. The CA ruled that Dr. Bandojo
was able to prove the habitual tardiness of Pardillo which resulted
in her neglect of duties and poor work performance. As a
managerial employee, the CA held that Pardillo should be a sterling
example of honesty, trustworthiness, and efficiency in the
workplace. The CA also found that Pardillo's act of ordering her
subordinate to punch in her time card was an act of falsification. 15
On the issue of procedural due process, the CA held that
Dr. Bandojo was able to comply with the two-notice rule. Pardillo
was given a chance to present her side, numerous memoranda and
warnings were issued to her due to tardiness, as well as a separate
memorandum regarding the time-card incident. Two administrative
conferences were held where Pardillo was given a chance to
explain her side. Finally, a notice of termination 16 was sent to
Pardillo on November 18, 2010. 17 Thus, the CA overturned the
findings of the NLRC and reinstated the LA Decision. Pardillo's
MR was denied by the CA in the Assailed Resolution.
Pardillo filed the instant petition alleging that there were
no valid grounds for her dismissal. 18 As well, Pardillo claims that
Dr. Bandojo failed to comply with procedural due process. She did
not receive any notice to explain prior to receiving the notice of
termination. 19 Dr. Bandojo filed her Comment 20 praying for the
dismissal of the petition.
Issue
Whether the CA committed reversible error in reversing
the NLRC Decision and reinstating the LA Decision.
The Court's Ruling
At the outset, the Court notes that Rule 45 petitions are
generally limited to questions of law, as the Court is not a trier of
facts. 21 However, an exceptional circumstance exists when the
findings of the LA, NLRC, and CA are conflicting, as in this case.
22

Requirements of substantive
and procedural due process
In determining the legality of an employee's dismissal,
the Court must determine the legality of the act of dismissal which
pertains to substantive due process, and the manner of dismissal
which constitutes procedural due process.
Under Article 294 of Presidential Decree No. 442 or the
Labor Code of the Philippines (Labor Code), 23 the employer shall
not terminate the services of an employee except for a just or
authorized cause.
The just causes for dismissal are listed under Article 297:
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 representative in
connection with his work;
(b) Gross and habitual neglect by the employee of
his duties;
(c) Fraud or willful breach by the employee of the
trust reposed in him by his employer or
duly authorized representative;
(d) Commission of a crime or offense by the
employee against the person of his
employer or any immediate member of
his family or his duly authorized
representatives; and
(e) Other causes analogous to the foregoing.
aDSIHc
Anent the procedural aspect, the employer must comply
with the two-notice rule, as mandated under the Implementing
Rules of Book VI of the Labor Code. 24 The employer must serve
the erring employee a first notice which details the ground/s for
termination, giving the employee a reasonable opportunity to
explain his side. In practice, this is commonly referred to as the
notice to explain (NTE). The second notice pertains to the written
notice of termination indicating that upon due consideration of all
circumstances, the employer has decided to dismiss the employee.
Loss of trust and confidence as
ground for dismissal
Article 297 (c) allows an employer to terminate the
services of an employee on the ground of loss of trust and
confidence. There are two requisites for this ground: first, the
employee must be holding a position of trust and confidence; and
second, there must be a willful act that would justify the loss of
trust and confidence which is based on clearly established facts. 25
Pardillo's status as a managerial employee holding the
position of Business Office Manager was never disputed in this
case. The pivotal issue thus before the Court is the existence of the
second requisite.
In Prudential Guarantee and Assurance Employee Labor
Union v. NLRC, 26 the Court expounded on loss of trust and
confidence as a ground for dismissal:
While the law and this Court
recognize the right of an employer to dismiss
an employee based on loss of trust and
confidence, the evidence of the employer must
clearly and convincingly establish the facts
upon which the loss of trust and confidence in
the employee is based.
To be a valid ground for dismissal,
loss of trust and confidence must be based on a
willful breach of trust and founded on clearly
established facts. A breach is willful if it is
done intentionally, knowingly and purposely,
without justifiable excuse, as distinguished
from an act done carelessly, thoughtlessly,
heedlessly or inadvertently. It must rest on
substantial grounds and not on the employer's
arbitrariness, whims, caprices or suspicion;
otherwise, the employee would remain
LABOR LAW REVIEW CASES SET 3 12
eternally at the mercy of the employer. Further,
in order to constitute a just cause for dismissal,
the act complained of must be work-related
and show that the employee concerned is unfit
to continue working for the employer. Such
ground for dismissal has never been intended
to afford an occasion for abuse because of its
subjective nature. 27
Jurisprudence has also distinguished the treatment of
managerial employees and rank-and-file personnel with regard to
the ground of loss and trust and confidence. In Etcuban Jr. v.
Sulpicio Lines, 28 the Court held:
x x x [W]ith respect to rank-and-file
personnel, loss of trust and confidence as
ground for valid dismissal requires proof of
involvement in the alleged events in question,
and that mere uncorroborated assertions and
accusations by the employer will not be
sufficient. But as regards a managerial
employee, the mere existence of a basis for
believing that such employee has breached the
trust of his employer would suffice for his
dismissal. Hence, in the case of managerial
employees, proof beyond reasonable doubt is
not required, it being sufficient that there is
some basis for such loss of confidence, such as
when the employer has reasonable ground to
believe that the employee concerned is
responsible for the purported misconduct, and
the nature of his participation therein renders
him unworthy of the trust and confidence
demanded by his position. 29
Thus, there must be some basis or reasonable ground to
believe that the employee is responsible for the misconduct and the
breach or act complained of must be related to the work performed
by the employee. Although the employer is given more leeway in
the dismissal of managerial employees on the ground of loss of trust
and confidence, the dismissal must not be based on the mere whims
or caprices of the employer. The dismissal must have reasonable
basis.
In illegal dismissal cases, the burden to prove that the
termination of employment was for a just and valid cause is on the
employer. 30 In this case, the Court holds that the CA committed
reversible error in overturning the findings of the NLRC. After a
judicious review of the facts as borne by the records, the Court finds
that Dr. Bandojo failed to prove with substantial evidence Pardillo's
alleged acts which led to loss of trust and confidence.
The records show that in a NTE 31 dated November 5,
2010, Pardillo was made to explain her alleged tardiness committed
on November 4 and 5, 2010. Pardillo replied in a letter 32 dated
November 6, 2010, apologizing for her tardiness. However, in the
notice of termination dated November 18, 2010, Dr. Bandojo
indicated the following grounds for Pardillo's dismissal:
You are hereby informed that your
services as Business Office Manager will be
terminated effective thirty (30) days from
receipt of this memorandum. ETHIDa
Due to the following causes:
1. Loss of trust and confidence
2. Habitual [t]ardiness
3. Texting insulting words to me, your
employer
4. Uttering offensive words against me,
your employer
5. Texting me, threatening to kill me or
any of my family[.] 33
The inclusion of the new allegations in the notice of
termination was not sufficiently explained by Dr. Bandojo. The
notice does not also state the alleged acts purportedly committed
by Pardillo which resulted in loss of trust and confidence. Pardillo
was not served with any NTE so that she could proffer her defense
with regard to the new allegations. Dr. Bandojo also did not
expound on the allegations regarding the insults and threats to her
life and her family, in the pleadings that she filed before the labor

tribunals and the courts. To the mind of the Court, these
circumstances cast serious doubt on the veracity of Dr. Bandojo's
contentions in the notice of termination.
The Court also affirms the findings of the NLRC
regarding the allegation of habitual tardiness. In order to justify the
dismissal of Pardillo, Dr. Bandojo submitted several notices from
as early as 1994 addressed to Pardillo regarding her tardiness which
allegedly amounted to 16,333 minutes. 34 However, as correctly
held by the NLRC, Pardillo was able to explain the reason why she
could not come to the office on the scheduled time because it was
necessary for her to go directly to the bank or to the PhilHealth
office to perform official business for the hospital. Moreover, the
letter dated October 30, 2010 sent by Dr. Bandojo to Pardillo
supports Pardillo's claim that she had a flexible work schedule. The
letter states:
TO: MS. LUCITA S. PARDILLO, B.O.
Manager
FROM: THE MEDICAL DIRECTOR
SUBJECT: IMPLEMENTATION OF
THE SCHEDULE OF DUTY HOURS
In our latest conversation, we have
agreed that your usual 8am-12pm, 1pm-5pm
schedule of duty hours will resume effective
November 1, 2010.
All other schedules granted or
allowed in the past per your various requests
and which have been granted and adjusted to
suit your past request in your schedule of duty
hours shall now become moot and academic.
To reiterate what we have agreed,
your new schedule of duty hours will be 8-12
in the morning and 1-5 in the afternoon,
Monday to Saturday.
For your guidance.
(Sgd.)
Dr. Evelyn [Ducay]
Bandojo, DFM 35
(Emphasis supplied)
The records do not indicate when Pardillo's flexible
schedule was granted, but the above letter satisfactorily confirms
that Pardillo was allowed some leeway in her work schedule as her
job required her to go to government agencies and banks to process
transactions of the hospital. The tardiness of Pardillo earlier than
October 30, 2010 cannot thus be taken against her because prior
thereto, she was not strictly required to be at the office from 8:00
A.M. to 12:00 noon and 1:00 P.M. to 5:00 P.M. The letter refers to
the 8:00 A.M. to 5:00 P.M. scheme as Pardillo's "new" schedule.
Pardillo was also sent a document entitled "Warning:
This is your nth offense" on August 10, 2010 regarding her
tardiness on several dates. However, the warning itself contains the
following proviso: "Suspension to Termination will be meted out
to erring personnel who incurred tardiness beyond the allowable
limit unless you can prove to management that your tardiness was
due to laudable acts beneficial to [the] hospital business and
service." 36 This confirms that the hospital policy recognized that
there may be reasonable grounds for an employee's tardiness,
which includes performing tasks beneficial to the hospital outside
of its premises. The Court also observes that the warning did not
contain a notice to explain but was merely a notice to Pardillo that
she had been tardy on specific dates.
With regard to the other allegations of Pardillo, the Court
quotes with approval the findings of the NLRC:
x x x The supposed claims of
patients Moises Servano and Jamal Alim have
been adequately explained by complainant. x x
x [T]he Phil[H]ealth claim of patient Moises
Servano, who is her relative, was returned to
the hospital because only the machine copy of
the original receipt of the blood purchased by
the patient was submitted. Servano died and his
relatives could no longer find the original copy
of the official receipt so that upon [the]
instruction of [Dr. Bandojo], complainant did
not refile the claim to P[hil]H[ealth]. As to
LABOR LAW REVIEW CASES SET 3 13
patient Jamal Alim, complainant averred that
Mr. Alim has no financial obligation to the
[h]ospital, which is not being controverted by
[Dr. Bandojo] x x x In the case of patient Adam
Stephen Chiu, his grand uncle Victor L. Chiu,
who was responsible for his hospitalization,
duly executed a statement under oath
contesting as without bases the charges
levelled by [Dr. Bandojo] against complainant
and categorically declared that Mr. Chiu's
balance of P4,968.16 with the hospital has
been offsetted (sic) with his professional fees
as an accountant of the hospital. 37 cSEDTC
The absence of any NTEs on the new allegations (i.e.,
failure to process PhilHealth claims, attempting to borrow money
for personal use, and allowing the release of patients with unpaid
hospital bills without any promissory note, uttering offensive
words and making death threats) can only be described as
bemusing. If the less serious offense of tardiness merited the
sending of several NTEs to Pardillo, why was it that Dr. Bandojo
did not send any NTEs for the more serious allegations? In her
position paper, 38 Dr. Bandojo admitted that the derogatory text
messages she received were from an unknown number. She
concluded that the sender was Pardillo merely because the
messages stopped after Pardillo stopped reporting for work. 39 Dr.
Bandojo likewise did not submit these text messages to the labor
tribunals or the courts. All in all, it is quite apparent that the loss of
trust and confidence in this case was not genuine and was merely
used as a convenient means to dismiss Pardillo.
Considering the foregoing, the Court finds that Dr.
Bandojo failed to prove with substantial evidence the acts
constituting willful breach of company policy, resulting to loss of
trust and confidence. Thus, Pardillo's dismissal was illegal.
The Court is not unaware of its Decision in Alvarez v.
Golden Tri Bloc, Inc., 40 in which a supervisory employee was also
caught directing his subordinate to punch-in his time card and the
Court upheld the validity of his dismissal. However, in Alvarez, the
incident for which the employee was disciplined was already his
second offense and the Court also considered the totality of
circumstances that included several prior offenses committed by
the employee relating to product shortages, negligence, and
tardiness, which were duly proven with substantial evidence. Thus,
it is not on all fours with this case.
Non-compliance with procedural
due process
Dr. Bandojo also failed to comply with the requirements
of procedural due process. As discussed above, Pardillo was served
with an NTE that charged her only with tardiness on two dates.
However, the notice of termination charged her with additional and
more serious grounds of loss of trust and confidence, habitual
tardiness, texting insulting words and uttering offensive words to
Dr. Bandojo, and threatening to kill Dr. Bandojo and her family.
The additional grounds cited in the notice of termination which
were not mentioned in the NTE violated Pardillo's right to be
informed of the administrative charges against her. The NTE and
the notice of termination did not state the specific acts that
constituted breach of company policies resulting in loss of trust and
confidence and the specific company policies that were violated.
The Court notes that there was an earlier memorandum
41 dated September 27, 2010 (memorandum) addressed to Pardillo
and other officers requesting them to attend a conference on
September 28, 2010 to explain the incident in which Pardillo's
subordinate, Mrs. Natividad Ladaban, was caught punching
Pardillo's time card in the bundy clock. However, this cannot be
considered the NTE required under the Labor Code. In King of
Kings Transport, Inc. v. Mamac, 42 the Court elucidated on the
required contents of an NTE:
(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. This should be construed as a period
 LABOR LAW REVIEW CASES SET 3 14

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. 43
The memorandum did not state the grounds for dismissal
or disciplinary action, the specific acts of Pardillo constituting
breach of company policy, and the actual company policy violated.
The memorandum did not also direct Pardillo to submit a written
explanation within a reasonable period of time. In fact, the
conference was scheduled on the very next day. 44 Thus, the said
memorandum was not a proper NTE. Moreover, after the
conference, Dr. Bandojo did not inform Pardillo of her findings or
impose any disciplinary action against Pardillo with regard to the
allegations about the time-card incident. It was only on November
18, 2010 that Dr. Bandojo sent the notice of termination which
included new allegations.
In fine, Dr. Bandojo failed to comply with the
requirements of procedural and substantive due process in effecting
the termination of Pardillo's employment. There was no substantial
evidence to prove that she committed serious breaches of company
policy resulting in loss of trust and confidence. Moreover, Pardillo
was not afforded procedural due process.
Pardillo is entitled to
backwages and separation pay
equitable justification. Even when a claimant is
compelled to litigate with third persons or to
incur expenses to protect his rights, still
attorney's fees may not be awarded where no
sufficient showing of bad faith could be
reflected in a party's persistence in a case other
than an erroneous conviction of the
righteousness of his cause. 50
Thus, in the absence of any factual, legal, or equitable
basis for the award of attorney's fees, the Court denies the same.
Finally, the monetary award herein granted shall earn legal interest
of 12% per annum from November 18, 2010, the date of illegal
dismissal, until June 30, 2013 in line with the Court's ruling in
Nacar v. Gallery Frames. 51 From July 1, 2013 until full
satisfaction of the award, the interest rate shall be at 6%. 52
WHEREFORE, premises considered, the petition is
GRANTED. The Court further RESOLVES to:
1. REVERSE and SET ASIDE the assailed Court of
Appeals Decision dated September 17, 2015
and Resolution dated May 4, 2016 in CA-G.R.
SP No. 05365-MIN;
2. AWARD petitioner Lucita S. Pardillo the following:
a. FULL BACKWAGES, inclusive of
allowances, and other benefits or
their monetary equivalent from
November 18, 2010 until finality of
this judgment;
b. SEPARATION PAY in lieu of
reinstatement at one-month salary
for every year of service, with a
fraction of at least six (6) months
considered as one whole year
computed from November 1990 (the
date of hiring) until finality of this
judgment;

The Court affirms the NLRC's award of backwages and 3. The monetary award shall earn legal interest of 12%
separation pay. Article 294 of the Labor Code grants to an per annum from November 18, 2010 until June
employee who is unjustly dismissed from work, reinstatement 30, 2013 and 6% from July 1, 2013 until full
without loss of seniority rights and other privileges and full satisfaction of the award; and
backwages, inclusive of allowances, other benefits or their 4. REMAND the case to the Labor Arbiter for the proper
monetary equivalent computed from the time his compensation was computation of backwages and separation pay
withheld from him up to the time of his actual reinstatement. and for execution of the award. acEHCD
SDAaTC
SO ORDERED.
In Aliling v. Feliciano, 45 citing Golden Ace Builders v.
Talde, 46 the Court awarded both backwages and separation pay: Carpio, Perlas-Bernabe, J.C. Reyes, Jr. and Lazaro-
Javier, JJ., concur.
The basis for the payment of
backwages is different from that for the award ||| (Pardillo v. Bandojo, G.R. No. 224854, [March 27, 2019])
of separation pay. Separation pay is granted
where reinstatement is no longer advisable
because of strained relations between the
employee and the employer. Backwages
represent compensation that should have been
earned but were not collected because of the
unjust dismissal. The basis for computing
backwages is usually the length of the
employee's service while that for separation
pay is the actual period when the employee was
unlawfully prevented from working. 47
The relationship between the parties in the case are
undoubtedly strained and reinstatement would no longer be viable.
Thus, the grant of separation pay is fully justified.
However, the Court modifies the NLRC award and
deletes the award of attorney's fees. The award of attorney's fees is
the exception rather than the general rule based on the policy that
no premium should be placed on the right to litigate. 48 That a party
was compelled to initiate an action does not automatically entitle
them to attorney's fees. In ABS-CBN Broadcasting Corp. v. CA, 49
the Court ruled:
The general rule is that attorney's
fees cannot be recovered as part of damages
because of the policy that no premium should
be placed on the right to litigate. They are not
to be awarded every time a party wins a suit.
The power of the court to award attorney's fees
under Article 2208 demands factual, legal, and