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San Miguel Corp v. Ople PT&T v.

SMC-Sales Union (PTGWO) and SMC CBA: “employees entitled to De Guzman was initially hired by PT&T as a reliever for an employee on
basic monthly compensation plus commission based on their respective maternity leave, specifically as a Supernumerary Project Worker, for a
sales” fixed period
• The current marketing scheme goes like this: the Route Salesmen − Her services as reliever were renewed twice to replace another
were assigned specific territories within which to sell their stocks employee who went on leave. After the second period, her services
of beer, and wholesalers had to buy beer products from them. were terminated
− A month after, De Guzman was asked to join as a probationary
The company introduced a new marketing scheme called the employee
Complementary Distribution System (CDS) whereby their beer products In the job application form, she indicated in the portion for civil status
would be offered for sale directly to wholesalers through San Miguel’s that she was single although she contracted marriage a few months
sales offices instead of the Route Salesmen. The company shall then earlier (May)
pay back adjustment commissions to the petitioners PTGWO. − De Guzman made the same representation in the 2nd and 3rd
reliever agreements
PTGWO filed for unfair labor practice and a notice of strike against the
respondent company, arguing that the CDS violated the CBA because When PT&T learned about the same, its branch supervisor sent a
the CDS would allegedly reduce the salesemen’s and their truck drivers’ memorandum to De Guzman requiring her to explain the discrepancy.
take-home pay. Allegedly, such a scheme would unfairly compete with − Memo: She was reminded about the company’s policy of not
them. accepting married women for employment
− Reply: De Guzman stated that she was not aware of PT&T’s
HELD: CDS did not violate CBA and SMC did not indirectly bust policy regarding married women at the time, and that all along she
the union. had not deliberately hidden her true civil status
The CDS was a valid exercise of the company’s management
prerogatives. She was thus terminated and filed a case for illegal dismissal
− An employer is free to regulate, according to his own discretion,
all aspects of employment, as long he does not exceed the limits HELD: ILLEGALLY DISMISSED
of special laws. This includes hiring, work assignments, working The Court cited the Constitution, CEDAW, the Labor Code, and other
methods, manner of work, the tools to be used, and processes to laws to emphasize the state policy towards eliminating discrimination
be followed. against women.

To increase profits, a business enterprise may adopt means to Article 136 of the Labor Code explicitly prohibits discrimination merely
accomplish such goal. by reason of the marriage of a female employee:
As long as a company’s management prerogatives are done: It shall be unlawful for an employer to require as a condition of
1. in good faith for the advancement of the employer’s interest and employment or continuation of employment that a woman shall not get
2. not for circumventing the employees’ rights under special laws or valid married, or to stipulate expressly or tacitly that upon getting married, a
agreements, then the Court shall uphold such. woman employee shall be deemed resigned or separated, or to actually
dismiss, discharge, discriminate or otherwise prejudice a woman
In this case, the company’s good faith is manifested by the fact that employee merely by reason of marriage.
they offered to compensate the members of its sales force via their back
adjustment commissions to make up for the commissions they might lose On the other hand, it is recognized that regulation of manpower by the
because of the CDS. This proves that the company did not want to bust company falls within the so-called management prerogatives.
their union. − An employer is free to regulate, according to his discretion and
best business judgment, all aspects of employment, from hiring to
firing, except in cases of unlawful discrimination or those
which may be provided by law.
PT&T’s policy of not accepting or considering as disqualified − He later clarified that the suspension applies only to those who will
from work any woman worker who contracts marriage runs afoul campaign for a political party or candidate and that those who
of the test of, and the right against, discrimination, afforded all seek public office must resign from their position.
women workers by our labor laws and by no less than the
Constitution. Ymbong notified Luzon that he would leave the radio station for a couple
of months as he would be campaigning for the administration ticket.
Contrary to PT&T’s assertion that it dismissed De Guzman from − However, Ymbong did not campaign for another since unknown to
employment on account of her dishonesty, the record discloses clearly ABS, he was a candidate in the election himself for the position of
that her ties with the company were dissolved principally because of their councilor.
policy, and not merely because of her supposed acts of dishonesty: Unfortunately, Ymbong lost in the elections. Ymbong then tried to come
1. Memorandum: “you’re fully aware that the company is not back to ABS, but they were refused access therero, saying that he no
accepting married women employee (sic), as it was verbally longer works for ABS due to the company policy.
instructed to you.” − ABS, without reinstating Ymbong, allowed him to wind up his
2. Termination notice: De Guzman was made to understand that her shows on the radio station.
severance from the service was not only by reason of her
concealment of her married status but, over and on top of that, Ymbong then filed a complaint for illegal dismissal:
was her violation of the policy against marriage − He contends that the policy runs counter to the employees’right
of suffrage
De Guzman’s act of concealing the true nature of her status could not − ABS contends that their policy regarding public office was binding
be properly characterized as willful or in bad faith as she was moved to against Ymbong, thus, the removal was valid.
act that way because she wanted to retain a permanent job in a stable
company. HELD: The policy is a valid exercise of management prerogative.
Working for the government and the company at the same time is clearly
Carried to its logical consequences, it may even be said that PT&T’s disadvantageous and prejudicial to the rights and interest not only of the
policy against legitimate marital bonds would encourage illicit or common- company but the public as well. In the event an employee wins in an
law relations and subvert the sacrament of marriage. election, he cannot fully serve, as he is expected to do, the interest of
his employer.
Ymbong v. ABSCBN
Ymbong was a talent at ABSCBN’s regional station in Cebu, co- In the event the employee loses in the election, the impartiality and cold
anchoring Hoy Gising and TV Patrol Cebu. He also worked as a drama neutrality of an employee as broadcast personality is suspect, thus
and voice talent. readily eroding and adversely affecting the confidence and trust of the
listening public to employer’s station.
His stint in ABS-CBN later extended to radio when ABS-CBN Cebu − ABS itself justifies the policy as a tool to preserve its objectivity,
launched its AM station DYAB in 1995 where he worked as drama and neutrality, and credibility.
voice talent, spinner, scriptwriter and public affairs program anchor.
It is a rule that a management prerogative is upheld when it is exercised
ABS head office issued a policy on employees seeking public office: in good faith for the advancement of the employer’s interest and not for
1. Any employee who intends to run for any public office position, the purpose of circumventing the rights of the employees under laws and
must file his/her letter of resignation, at least thirty (30) days agreements.
prior to the official filing of the certificate of candidacy. − It is well within its rights to ensure that it maintains its objectivity
2. Any employee who intends to join a political party or who intends and credibility and freeing itself from any appearance of
to aggressively campaign for a candidate must file a request for impartiality so that the confidence of the viewing and listening
leave subject to management approval. public in it will not be in any way eroded.
Furthermore, the Fair Elections Act supports the view that an employee
Because of the impending May 1998 elections and based on his in the news industry is deems resign upon seeking office, if so required
immediate recollection of the policy at that time, Dante Luzon, Assistant by the employer.
Station Manager of DYAB issued a memo reiterating the policy. The court also said that the memorandum issued by Luzon did not
− However, the memorandum reads “services rendered by the supersede the Policy since Luzon issued the memorandum beyond the
concerned employee/talent to this company will then be scope of his authority. The policy being valid, Ymbong was deemed
temporarily suspended for the entire campaign/election period.” resigned upon running for office as councilor.
Goya Inc v Goya Employees Union resorted to circumvent the law or must not have been the result of
Petitioner Goya, Inc. (Company), hired contractual employees from malicious arbitrary actions.
PESO Resources Development Corporation (PESO) to perform
temporary and occasional services in its factory. It is familiar and fundamental doctrine in labor law that the CBA is the
This prompted respondent Union to request for a grievance conference law between the parties and they are obliged to comply with its provisions
on the ground that the contractual workers do not belong to the
categories of employees stipulated in the CBA ( Probationary, Regular Tabuk Coop v. Duclan
or Casual ) Petitioner TAMPCO is a duly registered cooperative engaged in the
− the Union asserted that the hiring of contractual employees from business of obtaining investments from its members. TAMPCO
PESO is not a management prerogative and in gross violation of introduced Special Investment Loans (SILs) to its members and
the CBA tantamount to unfair labor practice (ULP). prospective borrowers.
− It noted that the contractual workers engaged have been assigned − A year after, TAMPCO realized that the SILs adversely affected
to work in positions previously handled by regular workers and its ability to lend under the regular loan program so its BOD issued
Union members. With the hiring of contractual employees, the Union BA No. 55 which completely prohibited the grant of SILs.
contended that it would no longer have probationary and casual Despite these 2 issuances, respondent Duclan and the other officers of
employees from which it could obtain additional Union members. the cooperative (incl. its former GM) continued to approve and release
Company argued that its act of contracting out service was a additional SILs to Falgui and Kotoken.
management prerogative. Eventually, Falgui claimed insolvency and Kotoken failed to pay back
her loans. Upon discovery of the said irregularity, respondent Dulcan was
ISSUE: W/N Company’s engagement of contractual workers suspended and was ordered to collect the amount lost with a threat that
from PESO was a valid exercise of management prerogative- should she fail to do so, she would be dismissed.
NO Duclan failed to collect and was dismissed, prompting her to file a
The Company kept on harping that both the VA and the CA conceded complaint for illegal dismissal.
that its engagement of contractual workers from PESO was a valid
exercise of management prerogative. HELD: VALIDLY DIMISSMISED
− It is confused. To emphasize, declaring that a particular act falls An employee's willful and repeated disregard of a resolution issued by a
within the concept of management prerogative is significantly cooperative's BOD declaring a moratorium on the approval and release
different from acknowledging that such act is a valid exercise of loans, placing the resources and savings of its members in a
thereof. precarious state, constitutes willful disobedience which justifies the
− What the VA and the CA correctly ruled was that the Company's penalty of dismissal under Article 282 of the Labor Code.
act of contracting out/outsourcing is within the purview of
management prerogative. Both did not say, however, that such act She cannot question the BOD’s decision as regards the General
is a valid exercise thereof. Manager, whom the BOD permitted to retire and collect his benefits in
full. Such decision is management’s prerogative on which the courts
Obviously, this is due to the recognition that the CBA provisions agreed cannot interfere unless they violate labor laws, CBA and general
upon by the Company and the Union delimit the free exercise of principles of fairness and justice.
management prerogative pertaining to the hiring of contractual - Management is not precluded from condoning the infractions of
employees. its employees; as with any other legal right, the management
prerogative to discipline employees and impose punishment may be
As repeatedly held, the exercise of management prerogative is not waived. As far as respondent is concerned, TAMPCO chose not
unlimited; it is subject to the limitations found in law, collective bargaining to waive its right to discipline and punish her since this is its
agreement or the general principles of fair play and justice. Evidently, privilege as the holder of such right.
this case has one of the restrictions — the presence of specific CBA - It cannot be said that respondent was discriminated against or
provisions cited by the Company. singled out, for among all those indicted, only the former General
Thus, the Company's engagement of PESO was indeed a management Manager was accorded leniency; the rest, including respondent,
prerogative. were treated on equal footing.
This management prerogative of contracting out services, however, is - As to why the former General Manager was allowed to retire, this
not without limitation. In contracting out services, the management must precisely falls within the realm of management prerogative; what
be motivated by good faith and the contracting out should not be matters, as far as the Court is concerned, is that respondent was
not singled out and treated unfairly
Central Azucarera v. Heirs of Apostol holding a position of trust and confidence; and (2) there must be
Apostol was a Motor Pool Over-All Repairs Supervisor of Central an act that would justify the loss of trust and confidence.
Azucarera. As a supervisor, one of the pre-requisites accorded to the
respondent was the enjoyment of a company house where the A perusal of the entirety of the records would reveal that all the
respondent could live so long as he remains as a CAB employee. requirements for the valid dismissal of the respondent exist.
Later, after an inspection of one of CAB’s security guards, it was found 1. The position of the respondent is one of trust and
that Apostol was using his company house, as well as other company confidence and responsibility as a supervisor
equipment to repair privately owned vehicles. 2. The respondent did what he did due to his position in the
A memorandum was issued against him by the resident manager for company
violating Rule 9 of the Rules of Discipline — Utilizing material or 3. His violation of the company rules carries with it an impact
equipment of the Company, including power for doing private work to the operations and management of a company and a
without permission company’s decision to terminate an employee for these
− he was asked to report within 24 hours to explain in writing, the purposes is a decision that should be respected
− In response, respondent Apostol said that he was repairing his
personal vehicle using his personal equipment

This was followed by his termination and filing of a complaint for

constructive dismissal, illegal suspension.
LA ruled in favor of the petitioner company. NLRC reversed for the
respondent Apostol
CA affirmed NLRC.
− The CA averred that, while CAB was compliant with the twin
notice requirement, the respondent's violation "cannot be
considered as so grave as to be characterized either as serious
misconduct or could lead to a loss of trust and confidence

Issue: W/N the CA usurped the petitioner company’s management

prerogative to determine the penalty commensurate to the offense
committed, which had been the subject of prior notice to Mr. Apostol,
who knew the consequences of his violation? – YES

According to the case of Top Form Mfg. Co., Inc. vs. NLRC,
− an employer has a distinct prerogative to dismiss an employee
if the former has ample reason to distrust the latter or if
there is sufficient evidence to show that the employee has been
guilty of breach of trust.
Following the ruling in The Coca-Cola Export Corporation v. Gacayan
− the employers have a right to impose a penalty of dismissal on
employees by reason of loss of trust and confidence. More so, in
the case of supervisors or personnel occupying positions of
responsibility, loss of trust, justifies termination of
This discourse is further clarified in the recent case of Alaska Milk
Corporation, and the Estate of Wilfred Uytengsu vs. Ernesto L. Ponce
− ruled that, in order to invoke this cause, certain requirements must
be complied with, namely: (1) the employee concerned must be