maternity benefits because, as they found out, the company did not remit their contributions to the SSS.

MARK ROCHE INTERNATIONAL AND/OR EDUARDO DAYOT and SUSAN DAYOT, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION, MARK ROCHE WORKERS UNION and WILMA PATACAY, EILEEN RUFON, LILIA BRIONES, BEATRIZ MANAGAYTAY, DELIA ARELLANO, ANITA MARCELO, RIO MARIANO, MARISSA SADILI, ESTRELLA MALLARI, DELIA LAROYA, and DIVINA VILLARBA, respondents. On 11 October 1992 private respondents sought the assistance of a labor organization which helped them organize the Mark Roche Workers Union (MRWU). On 14 October 1992 they registered the union with the Department of Labor and Employment - National Capital Region (DOLE-NCR) and on the same date filed a Petition for Certification Election before the Med-Arbitration Board. On 27 October 1992 petitioners received a notice of hearing of the petition. Apparently irked by the idea of a union within the company, petitioners ordered private respondents to withdraw the petition and further threatened them that should they insist in the organization of a union they would be dismissed. Unfazed, private respondents refused. As expected, on 29 October 1992 they were discharged from work. On 30 October 1992 private respondents amended their earlier complaints to include as additional causes of action their illegal dismissal, unfair labor practice, non-payment of 13th month pay, underpayment for legal holidays, and for damages. Petitioners countered that private respondents were not dismissed from work but voluntarily abandoned their jobs thereby paralyzing company operations. Petitioners likewise contended that private respondents incurred numerous absences without prior notice and clearance from their superiors as evidenced by several company memos sent to them. Only Divina Villarba showed up and told petitioners that she was voluntary resigning because she had found better employment elsewhere. It was only later that petitioners learned that private respondents absences were due to their preoccupation with the organization of a labor union. Notwithstanding these absences, petitioners expressed their willingness to reinstate private respondents within a reasonable time. They however disclaimed knowledge of any deficiency owing to private respondents since all the benefits due them as required by law were fully paid, except overtime pay which they were not entitled to on account of their being piece-rate workers. On 3 March 1993 the Labor Arbiter rendered his decision declaring as illegal the constructive dismissal of private respondents. Petitioners were thus ordered to immediately reinstate private respondents as sewers and to pay each of them his (a) back wages computed from 29 October 1992 to 31 March 1993 in the amount of P15,524.08 subject to adjustments until reinstated but not to exceed three (3) years; (b) proportionate share in the 13th month pay for the period January to October 1992

DECISION BELLOSILLO, J.: This is a special civil action under Rule 65 of the Rules of Court to nullify the 14 August 1995 Decision of the National Labor Relations Commission which affirmed with modification the Decision of Labor Arbiter Eduardo J. Carpio. The Labor Arbiter held that private respondents were illegally constructively dismissed and ordered petitioners to reinstate them and pay them back wages as well as their proportionate 13th month pay, service incentive leave pay and salary differentials. The NLRC set aside the award of incentive leave pay. Petitioners Eduardo Dayot and Susan Dayot were President and Vice President, respectively, of their co-petitioner Mark Roche International (MRI), a corporation organized and existing under the laws of the Philippines, engaged in the garments business. Private respondents Eileen Rufon, Lilia Briones, Beatriz Managaytay, Delia Arellano, Anita Marcelo, Rio Mariano, Marissa Sadili, Wilma Patacay, Estella Mallari, Delia Laroya and Divina Villarba were employed as sewers of MRI with lengths of service varying from three (3) to nine (9) years. On different dates private respondents filed separate complaints for underpayment of wages and non-payment of overtime pay against petitioners MRI, Eduardo Dayot and Susan Dayot. Private respondents alleged that they usually worked eleven (11) to twelve (12) hours daily, except on Mondays during which they worked eight (8) hours, and were paid wages on a piece-rate basis amounting to P450.00 to P600.00 per week. They likewise asserted that sometime in 1992 they were unable to avail of their SSS benefits, e.g., salary loan, sickness benefits and

in the amount of P2,538.77; unpaid five (5) days service incentive leave pay for 1989, 1990 and 1991 in the amount of P1,565.00; and, (c) wage differentials in the amount of P24,707.38. On appeal the NLRC affirmed the reinstatement of private respondents and the payment of back wages, salary differentials and proportionate 13th month pay but set aside the award of service incentive leave pay on the ground that private respondents were not entitled thereto as they were piece-rate workers. Petitioners moved for reconsideration but was denied for lack of merit. Petitioners now contend that the NLRC committed grave abuse of discretion amounting to lack or excess of jurisdiction in sustaining the Labor Arbiter by declaring private respondents as having been constructively dismissed from their jobs, hence, illegal. On the contrary, they argue that private respondents voluntarily abandoned their jobs without justifiable reason nor prior notice. The NLRC disregarded the company memos addressed to each of the private respondents which were indicative of their intention to leave the company and showed their propensity to incur frequent absences in violation of company rules and regulations. Abandonment, as a just and valid ground for dismissal, means the deliberate and unjustified refusal of an employee to resume his employment. The burden of proof is on the employer to show an unequivocal intent on the part of the employee to discontinue employment. The intent cannot be lightly inferred or legally presumed from certain ambivalent acts. There must be a concurrence of both the intention to abandon and some overt act from which it can be deducted that the employee has no more intention to resume his work.[1] These are not obtaining in the instant case. No overt act was established by petitioners from which to infer the clear intention of private respondents to desist from their employment. The company memos submitted by petitioner could not be the basis of such intention since they referred to absences incurred by private respondents long before their dismissal. The lack of proximity of those absences to the actual dismissal rendered them unreliable, even worthless. Moreover, as correctly found by the NLRC, it was unlikely that private respondents had abandoned their jobs considering their lengths of service in the company and the difficulty in finding similar employment. In addition, if they had truly forsaken their jobs, they would not have bothered to file a complaint for constructive dismissal against petitioners

immediately after they were dismissed and prayed for their reinstatement. An employee who forthwith takes steps to protest his layoff cannot by any logic be said to have abandoned his work. [2] On the contrary, there is ample proof showing that private respondents were dismissed from their jobs for their refusal to withdraw their petition for certification election filed before the DOLE. However, it must be made clear here that the dismissal of private respondents was not a constructive dismissal but an illegal dismissal, and this is where both the NLRC and the Labor Arbiter erred. Constructive dismissal or a constructive discharge has been defined as a quitting because continued employment is rendered impossible, unreasonable or unlikely, as an offer involving a demotion in rank and a diminution in pay.[3] In the instant case, private respondents were not demoted in rank nor their pay diminished considerably. They were simply told without prior warning or notice that there was no more work for them. After receiving the notice of hearing of the petition for certification election on 27 October 1992, petitioners immediately told private respondents that they were no longer employed. Evidently it was the filing of the petition for certification election and organization of a union within the company which led petitioners to dismiss private respondents and not petitioners' allegations of absence or abandonment by private respondents. The formation of a labor union has never been a ground for valid termination, and where there is an absence of clear, valid and legal cause, the law considers the termination illegal.[4] Petitioners likewise contend that the NLRC acted with grave abuse of discretion in granting private respondents reinstatement with payment of back wages. They argue that reinstatement can no longer be effected in view of the lapse of a considerable period of time from the dismissal of private respondents in October 1992 to the time the order for reinstatement was released. As for the award of back wages, they assert that it is capricious and arbitrary since it only encourages indolence and promotes enrichment of private respondents at the expense of petitioners. The award of reinstatement and back wages belongs to an illegally dismissed employee by direct provision of law and cannot be defeated by mere allegations of inconvenience, inconceivability or implausibility. Article 279 of the Labor Code provides that an illegally dismissed employee is entitled to reinstatement without loss of seniority rights and other privileges and to his full back wages from the time his compensation was withheld from him up to the time of his actual reinstatement. Back wages are granted on

grounds of equity for earnings which a worker or employee has lost due to his illegal dismissal.[5] Petitioners are however given the alternative of paying separation pay to illegally dismissed employees where reinstatement is no longer possible. Petitioners further aver that the NLRC likewise abused its discretion when it affirmed the Labor Arbiters ruling that private respondents were not paid their money claims. They insist that they have already paid private respondents all the amounts and benefits due them and that had the Labor Arbiter conducted trial on the merits, they could have presented documents proving their claim to be true. The decision of the Labor Arbiter not to schedule the case for another hearing could not be considered arbitrary. The holding of a hearing is discretionary with the Labor Arbiter and is something which the parties cannot demand as a matter of right.[6] It is entirely within the bounds of the Labor Arbiters authority to decide a case based on mere position papers and supporting documents without a formal trial or hearing. The requirements of due process are satisfied when the parties are given the opportunity to submit position papers wherein they are supposed to attach all the documents that would prove their claim in case it be decided that no hearing should be conducted or was necessary. In case of employees money claims, the employer bears the burden to prove that employees have received their wages and benefits and that the same were paid in accordance with law. It is incumbent upon the employer to present the necessary documents to prove such claims. In their position paper, petitioners failed to present necessary documentary evidence to substantiate their allegation that private respondents money claims were fully paid. They cannot use the absence of trial as an excuse for their failure as they could have presented documentary evidence at any time before the Labor Arbiter and, on appeal, before the NLRC. Hence, they cannot at this late stage bewail that they were not afforded due process. Finally, as correctly held by the NLRC, private respondents as piece-rate employees are not entitled to service incentive leave pay as well as holiday pay even if they are entitled to other benefits like COLA and 13th month pay. Service incentive leave pay shall not apply to employees whose performance is unsupervised by the employer, including those who are paid in a fixed amount for performing work irrespective of the time consumed in the performance thereof.[7]

WHEREFORE, this Court finds that private respondents Eileen Rufon, Lilia Briones, Beatriz Managaytay, Delia Arellano, Anita Marcelo, Rio Mariano, Marissa Sadili, Wilma Patacay, Estrella Mallari, Delia Laroya and Divina Villarba were illegally dismissed not merely illegally constructively dismissed - by petitioners Mark Roche International and/or Eduardo Dayot and Susan Dayot, and to this extent, the assailed Decision of public respondent National Labor Relations Commission affirming that of the Labor Arbiter, is MODIFIED. However, it is AFFIRMED insofar as it ordered the reinstatement of private respondents with back wages, salary differentials and 13th month pay. The service incentive leave pay awarded by the Labor Arbier but deleted by the National Labor Relations Commission is likewise DELETED. SO ORDERED. Mendoza, Quisumbing, and Buena, JJ., concur.

by respondents security guard in the act of attempting to smuggle out of the company premises 60 kilos of scrap iron worth P840 aboard respondents Isuzu Cargo Aluminum Van with Plate Number PHP 271 that was then assigned to him. When questioned, petitioner allegedly admitted to the security guard that he was taking out the scrap iron consisting of lift springs out of which he would make axes. Petitioner, in compliance with the Show Cause Notice [1] dated December 5, 2007 issued by respondent companys Human Resource Department Manager, denied the allegations by a handwritten explanation written in the Visayan dialect. Finding petitioners explanation unsatisfactory, respondent company terminated his employment by Notice of Termination [2] effective December 14, 2007 on the grounds of loss of trust and confidence, and of violation of company rules and regulations. In issuing the Notice, respondent company also took into account the result of an investigation showing that petitioner had been smuggling out its cartons which he had sold, in conspiracy with one Maritess Alaba, for his own benefit to thus prompt it to file a criminal case for Qualified Theft [3] against him before the Regional Trial Court (RTC) of Bohol. It had in fact earlier filed another criminal case for Qualified Theft [4] against petitioner arising from the theft of the scrap iron. Petitioner thereupon filed a complaint against respondent company for illegal dismissal and underpayment of wages. He claimed that the smuggling charge against him was fabricated to justify his illegal dismissal; that the filing of the charge came about after he reported the loss of the original copy of his pay slip, which report, he went on to claim, respondent company took to mean that he could use the pay slip as evidence for filing a complaint for violation of labor laws; and that on account of the immediately stated concern of respondent, it forced him into executing an affidavit that if the pay slip is eventually found, it could not be used in any proceedings between them. By Decision [5] of June 30, 2008, the Labor Arbiter, holding that the pendency of the criminal case involving the scrap iron did not warrant the suspension of the proceedings before him, held that petitioners dismissal was justified, for he, a truck driver, held a position of trust and confidence, and his act of stealing company property was a violation of the trust reposed upon him. Respecting the charge of underpayment of wages, the Labor

THIRD DIVISION [G.R. No. 191008, April 11, 2011] QUIRICO LOPEZ, PETITIONER, VS. ALTURAS GROUP OF COMPANIES AND/OR MARLITO UY, RESPONDENTS. DECISION CARPIO MORALES, J.: Quirico Lopez (petitioner) was hired by respondent Alturas Group of Companies in 1997 as truck driver. Ten years later or sometime in November 2007, he was dismissed after he was allegedly caught

Arbiter noted that on the basis of the records, petitioner had been paid the correct wages and benefits mandated by law. The Labor Arbiter accordingly dismissed petitioners complaint. On appeal, the National Labor Relations Commissions (NLRC) Fourth Division (Cebu City) set aside the Labor Arbiters Decision by Decision [6] dated December 22, 2008, finding that respondents evidence did not suffice to warrant the termination of petitioners services; and that petitioners alleged admission of taking the scrap iron was belied by his vehement denial, as even the security guard, one Gerardo Luega, who allegedly witnessed the asportation and before whom the alleged admission was made, did not even execute an affidavit in support thereof. Citing Salaw v. NLRC, [7] the NLRC went on to hold that petitioner should have been afforded, or at least advised of the right to counsel. It thus held that any evaluation which was based only on the explanation to the show-cause letter and any so-called investigation but without confrontation of the vital witnesses, do[es] not suffice. Respondent companys motion for reconsideration was denied by Resolution [8] of April 30, 2009, hence, it appealed to the Court of Appeals. By Report [9] of December 18, 2009, the appellate court reversed the NLRC ruling. It held that respondent company was justified in terminating petitioners employment on the ground of loss of trust and confidence, his alleged act of smuggling out the scrap iron having been sufficiently established through the affidavits of Patrocinio Borja and Zalde Tare, supervisor and junior supervisor, respectively, of its Supermarket Motorpool. The appellate court further held that the evidence supporting the criminal charge, found after preliminary investigation are [sic] sufficient to show prima facie guilt, which constitutes just cause for [petitioners dismissal] based on loss of trust and confidence; and that petitioners subsequent acquittal in the criminal case did not automatically preclude a determination that he is guilty of acts inimical to the employers interest resulting in loss of trust and confidence. Albeit the appellate court found that petitioners dismissal was for a just cause, it held that due process was not observed when

respondent company failed to give him a chance to defend his side in a proper hearing. Following Agabon v. NLRC, [10] the appellate court thus ordered respondent to pay nominal damages of P30,000. Thus the appellate court disposed: WHEREFORE, in view of the foregoing, the Decision of the NLRC dated December 22, 2008 is hereby MODIFIED. Private respondents dismissal from employment is upheld on the ground of loss of trust and confidence, a just cause for termination. However, for failure to comply fully with the procedural due process, petitioner is ORDERED to pay private respondent the amount of P30,000.00 as nominal damages. [11] (underscoring supplied) Hence, the present petition for review on certiorari. Dismissals have two facets: the legality of the act of dismissal, which constitutes substantive due process, and the legality of the manner of dismissal which constitutes procedural due process. [12] As to substantive due process, the Court finds that respondent companys loss of trust and confidence arising from petitioners smuggling out of the scrap iron, conpounded by his past acts of unauthorized selling cartons belonging to respondent company, constituted just cause for terminating his services. Loss of trust and confidence as a ground for dismissal of employees covers employees occupying a position of trust who are proven to have breached the trust and confidence reposed on them. Apropos is Cruz v. Court of Appeals [13] which explains the basis and quantum of evidence of loss of trust and confidence, viz: In addition, the language of Article 282(c) of the Labor Code states that the loss of trust and confidence must be based on willful breach of the trust reposed in the employee by his employer. Such 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. Moreover, it must be based on substantial evidence and not on the employers whims or caprices or suspicions otherwise, the employee would eternally remain at the mercy of the employer. Loss of confidence must not be indiscriminately used as a shield by the employer against a claim that the dismissal of an employee was arbitrary.

And, in order to constitute a just cause for dismissal, the act complained of must bework-related and shows that the employee concerned is unfit to continue working for the employer. In addition, loss of confidence as a just cause for termination of employment is premised on the fact that the employee concerned holds aposition of responsibility, trust and confidence or that the employee concerned is entrusted with confidence with respect to delicate matters, such as the handling or care and protection of the property and assets of the employer. The betrayal of this trust is the essence of the offense for which an employee is penalized. (emphasis and underscoring supplied) Petitioner, a driver assigned with a specific vehicle, was entrusted with the transportation of respondent companys goods and property, and consequently with its handling and protection, hence, even if he did not occupy a managerial position, he can be said to be holding a position of responsibility. As to his actprincipal ground for his dismissal his attempt to smuggle out the scrap iron belonging to respondent company, the same is undoubtedly work-related. Respondent companys charge against petitioner was amply proven by substantial evidence consisting of the affidavits of various employees of respondent. Contrary to the NLRCs observation, the security guard who apprehended petitioner, Gerardo Luega, actually executed a statement [14] relative to the smuggling out of scrap iron, which was attached to, and served as basis for the filing of, the corresponding complaint for Qualified Theft. Petitioners claim that he was framed up after he allegedly lost his pay slip to draw respondent company to suspect that he might file a labor complaint for underpayment does not inspire credence. It is, however, with respect to the appellate courts finding that petitioner was not afforded procedural due process that the Court deviates from. Procedural due process has been defined as giving an opportunity to be heard before judgment is rendered. [15] In termination cases, Perez v. Philippine Telegraph and Telephone Company, [16] illuminates on the correct proceedings to be followed therein in order to comply with the due process requirement: The above rulings are a clear recognition that the employer may provide an employee with ample opportunity to be heard and defend himself with the assistance of a representative or counsel in ways other than a formal hearing. The employee can be fully

afforded a chance to respond to the charges against him, adduce his evidence or rebut the evidence against him through a wide array of methods, verbal or written. After receiving the first notice apprising him of the charges against him, the employee may submit a written explanation(which may be in the form of a letter, memorandum, affidavit or position paper) and offer evidence in support thereof, like relevant company records (such as his 201 file and daily time records) and the sworn statements of his witnesses. For this purpose, he may prepare his explanation personally or with the assistance of a representative or counsel. He may also ask the employer to provide him copy of records material to his defense. His written explanation may also include a request that a formal hearing or conference be held. In such a case, the conduct of a formal hearing or conference becomes mandatory, just as it is where there exist substantial evidentiary disputes or where company rules or practice requires an actual hearing as part of employment pretermination procedure. (emphasis and underscoring supplied) Petitioner was given the opportunity to explain his side when he was informed of the charge against him and required to submit his written explanation with which he complied. That there might have been no hearing is of no moment, for as Autobus Workers Union v. NLRC [17] holds: This Court has held that there is no violation of due process even if no hearing was conducted, where the party was given a chance to explain his side of the controversy. What is frowned upon is the denial of the opportunity to be heard. (emphasis supplied) Parenthetically, the Court finds that it was error for the NLRC to opine that petitioner should have been afforded counsel or advised of the right to counsel. The right to counsel and the assistance of one in investigations involving termination cases is neither indispensable nor mandatory, except when the employee himself requests for one or that he manifests that he wants a formal hearing on the charges against him. In petitioners case, there is no showing that he requested for a formal hearing to be conducted or that he be assisted by counsel. Verily, since he was furnished a second notice informing him of his dismissal and the grounds therefor, the twin-notice requirement had been complied

with to call for a deletion of the appellate courts award of nominal damages to petitioner. As for the subsequent dismissal of the criminal cases [18] filed against petitioner, criminal and labor proceedings are distinct and separate from each other. Each requires a different quantum of proof, arising though they are from the same set of facts or circumstances. As Vergara v. NLRC [19] holds: An employees acquittal in a criminal case does not automatically preclude a determination that he has been guilty of acts inimical to the employers interest resulting in loss of trust and confidence. Corollarily, the ground for the dismissal of an employee does not require proof beyond reasonable doubt; as noted earlier, the quantum of proof required is merely substantial evidence. More importantly, the trial court acquitted petitioner not because he did not commit the offense, but merely because of the failure of the prosecution to prove his guilt beyond reasonable doubt.. In other words, while the evidence presented against petitioner did not satisfy the quantum of proof required for conviction in a criminal case, it substantially proved his culpability which warranted his dismissal from employment. (emphasis supplied) WHEREFORE, the petition is DENIED. The Report dated December 18, 2009 of the Court of Appeals dismissing petitioners complaint is AFFIRMED withMODIFICATION in that the award of nominal damages in the amount of P30,000 isDELETED. Costs against petitioner. SO ORDERED. Brion, Bersamin, Villarama, Jr., and Sereno, JJ., concur.

SECOND DIVISION [G.R. No. 169191, June 01, 2011] ROMEO VILLARUEL, PETITIONER, VS. YEO HAN GUAN, DOING BUSINESS UNDER THE NAME AND STYLE YUHANS ENTERPRISES, RESPONDENT. DECISION PERALTA, J.: Assailed in the present petition are the Decision[1] and Resolution[2] of the Court of Appeals (CA) dated February 16, 2005 and August 2, 2005, respectively, in CA-G.R. SP No. 79105. The CA Decision modified the March 31, 2003 Decision of the National Labor Relations Commission (NLRC) in NLRC NCR CA 028050-01, while the CA Resolution denied petitioner's Motion for Reconsideration. The antecedents of the case are as follows: On February 15, 1999, herein petitioner filed with the NLRC, National Capital Region, Quezon City a Complaint[3] for payment of separation pay against Yuhans Enterprises. Subsequently, in his Amended Complaint and Position Paper[4] dated December 6, 1999, petitioner alleged that in June

1963, he was employed as a machine operator by Ribonette Manufacturing Company, an enterprise engaged in the business of manufacturing and selling PVC pipes and is owned and managed by herein respondent Yeo Han Guan. Over a period of almost twenty (20) years, the company changed its name four times. Starting in 1993 up to the time of the filing of petitioner's complaint in 1999, the company was operating under the name of Yuhans Enterprises. Despite the changes in the company's name, petitioner remained in the employ of respondent. Petitioner further alleged that on October 5, 1998, he got sick and was confined in a hospital; on December 12, 1998, he reported for work but was no longer permitted to go back because of his illness; he asked that respondent allow him to continue working but be assigned a lighter kind of work but his request was denied; instead, he was offered a sum of P15,000.00 as his separation pay; however, the said amount corresponds only to the period between 1993 and 1999; petitioner prayed that he be granted separation pay computed from his first day of employment in June 1963, but respondent refused. Aside from separation pay, petitioner prayed for the payment of service incentive leave for three years as well as attorney's fees. On the other hand, respondent averred in his Position Paper[5] that petitioner was hired as machine operator from March 1, 1993 until he stopped working sometime in February 1999 on the ground that he was suffering from illness; after his recovery, petitioner was directed to report for work, but he never showed up. Respondent was later caught by surprise when petitioner filed the instant case for recovery of separation pay. Respondent claimed that he never terminated the services of petitioner and that during their mandatory conference, he even told the latter that he could go back to work anytime but petitioner clearly manifested that he was no longer interested in returning to work and instead asked for separation pay. On November 27, 2000, the Labor Arbiter handling the case rendered judgment in favor of petitioner. The dispositive portion of the Labor Arbiter's Decision reads, thus: WHEREFORE, premises considered, judgment is hereby rendered in favor of the complainant and against herein respondent, as follows: 1. Ordering the respondents to pay separation benefits equivalent to one-half () month salary per year of service, a fraction of six months equivalent to one year to herein complainant based on the complainant's length of service reckoned from June 1963 up to October 1998 as provided under Article 284 of the Labor Code, the

same computed by the Computation and Examination Unit which we hereby adopt and approved (sic) as our own in the amount of NINETY-ONE THOUSAND FOUR HUNDRED FORTY-FIVE PESOS (P91,445.00); 2. Ordering the respondents to pay service incentive leave equivalent to fifteen days' salary in the amount of THREE THOUSAND FIFTEEN PESOS (P3,015.00). All other claims are dismissed for lack of merit. SO ORDERED.[6] Aggrieved, respondent filed an appeal with the NLRC. On March 31, 2003, the Third Division of the NLRC rendered its Decision[7] dismissing respondent's appeal and affirming the Labor Arbiter's Decision. Respondent filed a Motion for Reconsideration,[8] but the same was denied by the NLRC in a Resolution[9] dated May 30, 2003. Respondent then filed with the CA a petition for certiorari under Rule 65 of the Rules of Court. On February 16, 2005, the CA promulgated its presently assailed Decision disposing as follows: WHEREFORE, premises considered, the petition is partially GRANTED. The award of separation pay is hereby DELETED, but the Decision insofar as it awards private respondent [herein petitioner] service incentive leave pay of three thousand and fifteen pesos (P3,015.00) stands. The NLRC is permanently ENJOINED from partially executing its Decision dated November 27, 2000 insofar as the award of separation pay is concerned; or if it has already effected execution, it should order the private respondent to forthwith restitute the same. SO ORDERED.[10] Herein petitioner filed his Motion for Reconsideration[11] of the CA Decision, but it was denied by the CA via a Resolution[12] dated August 2, 2005. Hence, the instant petition based on the following assignment of errors:

I THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN ITS FAILURE TO APPRECIATE THE ADMISSION BY [PETITIONER] OF THE FACT AND VALIDITY OF HIS TERMINATION BY THE [RESPONDENT]. II [THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED] IN DENYING [PETITIONER'S] ENTITLEMENT TO SEPARATION PAY UNDER ARTICLE 284 OF THE LABOR CODE AND UNDER THE OMNIBUS RULES IMPLEMENTING THE LABOR CODE. III THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN ITS FINDING THAT THE BURDEN OF PROOF THAT AN EMPLOYEE IS SUFFERING FROM DISEASE THAT HAS TO BE TERMINATED REST[S] UPON THE EMPLOYER IN ORDER FOR THE EMPLOYEE TO BE ENTITLED TO SEPARATION PAY. IV THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN ORDERING THE DELETION OF THE AWARD OF SEPARATION PAY TO THE [PETITIONER].[13] The Court finds the petition without merit. The assigned errors in the instant petition essentially boil down to the question of whether petitioner is entitled to separation pay under the provisions of the Labor Code, particularly Article 284 thereof, which reads as follows: An employer may terminate the services of an employee who has been found to be suffering from any disease and whose continued employment is prohibited by law or is prejudicial to his health as well as to the health of his co-employees: Provided, That he is paid separation pay equivalent to at least one (1) month salary or to one-half () month salary for every year of service whichever is greater, a fraction of at least six months being considered as one (1) whole year. A plain reading of the abovequoted provision clearly presupposes that it is the employer who terminates the services of the employee found to be suffering from any disease and whose continued

employment is prohibited by law or is prejudicial to his health as well as to the health of his co-employees. It does not contemplate a situation where it is the employee who severs his or her employment ties. This is precisely the reason why Section 8,[14] Rule 1, Book VI of the Omnibus Rules Implementing the Labor Code, directs that an employer shall not terminate the services of the employee unless there is a certification by a competent public health authority that the disease is of such nature or at such a stage that it cannot be cured within a period of six (6) months even with proper medical treatment. Hence, the pivotal question that should be settled in the present case is whether respondent, in fact, dismissed petitioner from his employment. A perusal of the Decisions of the Labor Arbiter and the NLRC would show, however, that there was no discussion with respect to the abovementioned issue. Both lower tribunals merely concluded that petitioner is entitled to separation pay under Article 284 of the Labor Code without any explanation. The Court finds no convincing justification, in the Decision of the Labor Arbiter on why petitioner is entitled to such pay. In the same manner, the NLRC Decision did not give any rationalization as the gist thereof simply consisted of a quoted portion of the appealed Decision of the Labor Arbiter. On the other hand, the Court agrees with the CA in its observation of the following circumstances as proof that respondent did not terminate petitioner's employment:first, the only cause of action in petitioner's original complaint is that he was "offered a very low separation pay"; second, there was no allegation of illegal dismissal, both in petitioner's original and amended complaints and position paper; and, third, there was no prayer for reinstatement. In consonance with the above findings, the Court finds that petitioner was the one who initiated the severance of his employment relations with respondent. It is evident from the various pleadings filed by petitioner that he never intended to return to his employment with respondent on the ground that his health is failing. Indeed, petitioner did not ask for reinstatement. In fact, he rejected respondent's offer for him to return to work. This is tantamount to resignation. Resignation is defined as the voluntary act of an employee who finds himself in a situation where he believes that personal reasons cannot be sacrificed in favor of the exigency of the service and he has no other choice but to disassociate himself from his

employment.[15] It may not be amiss to point out at this juncture that aside from Article 284 of the Labor Code, the award of separation pay is also authorized in the situations dealt with in Article 283[16] of the same Code and under Section 4 (b), Rule I, Book VI of the Implementing Rules and Regulations of the said Code[17] where there is illegal dismissal and reinstatement is no longer feasible. By way of exception, this Court has allowed grants of separation pay to stand as "a measure of social justice" where the employee is validly dismissed for causes other than serious misconduct or those reflecting on his moral character.[18] However, there is no provision in the Labor Code which grants separation pay to voluntarily resigning employees. In fact, the rule is that an employee who voluntarily resigns from employment is not entitled to separation pay, except when it is stipulated in the employment contract or CBA, or it is sanctioned by established employer practice or policy. [19] In the present case, neither the abovementioned provisions of the Labor Code and its implementing rules and regulations nor the exceptions apply because petitioner was not dismissed from his employment and there is no evidence to show that payment of separation pay is stipulated in his employment contract or sanctioned by established practice or policy of herein respondent, his employer. Since petitioner was not terminated from his employment and, instead, is deemed to have resigned therefrom, he is not entitled to separation pay under the provisions of the Labor Code. The foregoing notwithstanding, this Court, in a number of cases, has granted financial assistance to separated employees as a measure of social and compassionate justice and as an equitable concession. Taking into consideration the factual circumstances obtaining in the present case, the Court finds that petitioner is entitled to this kind of assistance. Citing Eastern Shipping Lines, Inc. v. Sedan,[20] this Court, in the more recent case ofEastern Shipping Lines v. Antonio,[21] held: But we must stress that this Court did allow, in several instances, the grant of financial assistance. In the words of Justice Sabino de Leon, Jr., now deceased, financial assistance may be allowed as a measure of social justice and exceptional circumstances, and as an equitable concession. The instant case equally calls for balancing the interests of the employer with those of the worker, if only to approximate what Justice Laurel calls justice in its secular sense. In this instance, our attention has been called to the following circumstances: that private respondent joined the company when he was a young man of 25 years and stayed on until he was 48 years old; that he had given to the company the best years of his youth, working on board ship for almost 24 years; that in those years there was not a single report of him transgressing any of the company rules and regulations; that he applied for optional retirement under the company's non-contributory plan when his daughter died and for his own health reasons; and that it would appear that he had served the company well, since even the company said that the reason it refused his application for optional retirement was that it still needed his services; that he denies receiving the telegram asking him to report back to work; but that considering his age and health, he preferred to stay home rather than risk further working in a ship at sea. In our view, with these special circumstances, we can call upon the same "social and compassionate justice" cited in several cases allowing financial assistance. These circumstances indubitably merit equitable concessions, viathe principle of "compassionate justice" for the working class. x x x In the present case, respondent had been employed with the petitioner for almost twelve (12) years. On February 13, 1996, he suffered from a "fractured left transverse process of fourth lumbar vertebra," while their vessel was at the port of Yokohama, Japan. After consulting a doctor, he was required to rest for a month. When he was repatriated to Manila and examined by a company doctor, he was declared fit to continue his work. When he reported for work, petitioner refused to employ him despite the assurance of its personnel manager. Respondent patiently waited for more than one year to embark on the vessel as 2nd Engineer, but the position was not given to him, as it was occupied by another person known to one of the stockholders. Consequently, for having been deprived of continued employment with petitioner's vessel, respondent opted to apply for optional retirement. In addition, records show that respondent's seaman's book, as duly noted and signed by the captain of the vessel was marked "Very Good," and "recommended for hire." Moreover, respondent had no derogatory record on file over his long years of service with the petitioner. Considering all of the foregoing and in line with Eastern, the ends of social and compassionate justice would be served best if respondent will be given some equitable relief. Thus, the award of

P100,000.00 to respondent as financial assistance is deemed equitable under the circumstances.[22] While the abovecited cases authorized the grant of financial assistance in lieu of retirement benefits, the Court finds no cogent reason not to employ the same guiding principle of compassionate justice applied by the Court, taking into consideration the factual circumstances obtaining in the present case. In this regard, the Court finds credence in petitioner's contention that he is in the employ of respondent for more than 35 years. In the absence of a substantial refutation on the part of respondent, the Court agrees with the findings of the Labor Arbiter and the NLRC that respondent company is not distinct from its predecessors but, in fact, merely continued the operation of the latter under the same owners and the same business venture. The Court further notes that there is no evidence on record to show that petitioner has any derogatory record during his long years of service with respondent and that his employment was severed not by reason of any infraction on his part but because of his failing physical condition. Add to this the willingness of respondent to give him financial assistance. Hence, based on the foregoing, the Court finds that the award of P50,000.00 to petitioner as financial assistance is deemed equitable under the circumstances. WHEREFORE, the instant petition is DENIED. The assailed Decision and Resolution of the Court of Appeals are AFFIRMED with MODIFICATION by awarding petitioner with financial assistance in the amount of P50,000.00. SO ORDERED. Carpio, (Chairperson), Nachura, Abad, and Mendoza, JJ., concur.

to Laoag campus. On October 3, 2003, petitioner received a Memorandum9 transferring him to Data Center College Bangued, Abra branch as Head for Education/Instructor due to an urgent need for an experienced officer and computer instructor thereat. However, petitioner declined to accept his transfer to Abra citing the deteriorating health condition of his father and the absence of additional remuneration to defray expenses for board and lodging which constitutes implicit diminution of his salary.10 On November 10, 2003, petitioner filed a Complaint11 for constructive dismissal against respondents. Petitioner alleged that his proposed transfer to Abra constitutes a demotion in rank and diminution in pay and would cause personal inconvenience and hardship. He argued that although he was being transferred to Abra branch supposedly with the same position he was then holding in Laoag branch as Head for Education, he later learned through a Memorandum12 from the administrator of Abra branch that he will be re-assigned merely as an instructor, thereby relegating him from an administrative officer to a rank-and-file employee. Moreover, the elimination of his allowance for board and lodging will result to an indirect reduction of his salary which is prohibited by labor laws. Petitioner also claimed that when he questioned the indefinite suspension of the scholarship for post-graduate studies extended to him by respondents,13 the latter became indifferent to his legitimate grievances which eventually led to his prejudicial reassignment. He averred that his transfer is not indispensable to the schools operation considering that respondents even suggested that he take an indefinite leave of absence in the meantime if only to address his personal difficulties.14 Petitioner thus prayed for his reinstatement and backwages. Further, as Head for Education at Data Center College Laoag branch, petitioner asked for the payment of an overload honorarium as compensation for the additional teaching load in excess of what should have been prescribed to him. Exemplary damages and attorneys fees were likewise prayed for. For their part, respondents claimed that they were merely exercising their management prerogative to transfer employees for the purpose of advancing the schools interests. They argued that petitioners refusal to be transferred to Abra constitutes insubordination. They claimed that petitioners appointment as instructor carries a proviso of possible re-assignments to any branch or tie-up schools as the schools necessity demands. Respondents argued that petitioners designation as Head for

FIRST DIVISION G.R. No. 174158 June 27, 2011

WILLIAM ENDELISEO BARROGA, Petitioner, vs. DATA CENTER COLLEGE OF THE PHILIPPINES and WILFRED BACTAD,1 Respondents. DECISION DEL CASTILLO, J.: Our labor laws are enacted not solely for the purpose of protecting the working class but also the management by equally recognizing its right to conduct its own legitimate business affairs. This Petition for Review on Certiorari2 seeks the reversal of the Resolutions dated May 15, 20063 and August 4, 20064 of the Court of Appeals (CA) in CA-G.R. SP No. 93991, which dismissed petitioner William Endeliseo Barrogas Petition for Certiorari for procedural infirmities, as well as the Decision5 dated August 25, 2005 and Resolution6 dated January 31, 2006 of the National Labor Relations Commission (NLRC), with respect to the dismissal of petitioners claim of constructive dismissal against respondents Data Center College of the Philippines and its President and General Manager, Wilfred Bactad. Factual Antecedents On November 11, 1991, petitioner was employed as an Instructor in Data Center College Laoag City branch in Ilocos Norte. In a Memorandum7 dated June 6, 1992, respondents transferred him to University of Northern Philippines (UNP) in Vigan, Ilocos Sur where the school had a tie-up program. Petitioner was informed through a letter8 dated June 6, 1992 that he would be receiving, in addition to his monthly salary, a P1,200.00 allowance for board and lodging during his stint as instructor in UNP-Vigan. In 1994, he was recalled

Education in Laoag branch was merely temporary and that he would still occupy his original plantilla item as instructor at his proposed assignment in Abra branch. Respondents denied liability to petitioners monetary claims. Ruling of the Labor Arbiter

WHEREFORE, premises considered, the decision under review is hereby MODIFIED by ordering the respondent Data Center College of the Philippines, to pay the complainant the sum of SEVENTY THREE THOUSAND SEVEN THUNDRED [sic] THIRTY and 39/100 Pesos (P73,730.39), representing overload honorarium. All other claims are DISMISSED for lack of merit.

On September 24, 2004, the Labor Arbiter rendered a Decision15 dismissing the Complaint for lack of merit. The Labor Arbiter ruled that there was no demotion in rank as petitioners original appointment as instructor on November 11, 1991 conferred upon respondents the right to transfer him to any of the schools branches and that petitioners designation as Head for Education can be withdrawn anytime since he held such administrative position in a non-permanent capacity. The Labor Arbiter held that the exclusion of his allowance for board, lodging and transportation was not constructive dismissal, enunciating that the concept of non-diminution of benefits under Article 100 of the Labor Code prohibits the elimination of benefits that are presently paid to workers to satisfy the requirements of prevailing minimum wage rates. Since the benefit claimed by petitioner is beyond the coverage of the minimum wage law, its non-inclusion in his reassignment is not considered a violation. The Labor Arbiter also denied petitioners claim for overload honorarium for failure to present sufficient evidence to warrant entitlement to the same. The claim for damages was likewise denied. Ruling of the National Labor Relations Commission In a Decision16 dated August 25, 2005, the NLRC affirmed the findings of the Labor Arbiter that there was no constructive dismissal. It ruled that the management decision to transfer petitioner was well within the rights of respondents in consonance with petitioners contract of employment and which was not sufficiently shown to have been exercised arbitrarily by respondents. It agreed with the Labor Arbiter that petitioners designation as Head for Education was temporary for which he could not invoke any tenurial security. Further, the NLRC held that it was not proven with certainty that the transfer would unduly prejudice petitioners financial situation. The NLRC, however, found petitioner to be entitled to overload honorarium pursuant to CHED Memorandum Order No. 25 for having assumed the position of Head for Education, albeit on a temporary basis. The NLRC disposed of the case as follows:

SO ORDERED.17 From this Decision, both parties filed their respective motion for partial reconsideration. Petitioner assailed the NLRC Decision insofar as it dismissed his claims for reinstatement, backwages, damages and attorneys fees.18Respondents, for their part, questioned the NLRCs award of overload honorarium in favor of petitioner. These motions were denied by the NLRC in a Resolution dated January 31, 2006.19 Ruling of the Court of Appeals Both parties filed petitions for certiorari before the CA. Respondents petition for certiorari was docketed as CA-G.R. SP No. 94205, which is not subject of the instant review. On the other hand, petitioner filed on April 7, 2006, a Petition for Certiorari20 with the CA docketed as CA-G.R. SP No. 93991 assailing the NLRCs finding that no constructive dismissal existed. Realizing his failure to attach the requisite affidavit of service of the petition upon respondents, petitioner filed on April 27, 2006, an Ex-Parte Manifestation and Motion21 to admit the attached affidavit of service and registry receipt in compliance with the rules. On May 15, 2006, the CA dismissed the petition in CA-G.R. SP No. 93991 in a Resolution which reads: Petition is DISMISSED outright due to the following infirmities: 1. there is no statement of material dates as to when the petitioner received the assailed decision dated August 25, 2005 and when he filed a Motion for Reconsideration thereof; 2. there is no affidavit of service attached to the petition;

3. these initiatory pleadings and the respondents Motion for Reconsideration of the Decision dated August 25, 2005 are not attached to the petition. SO ORDERED.
22

Petitioner imputes grave abuse of discretion on the CA in not giving due course to his petition despite substantial compliance with the requisite formalities as well as on the NLRC in not ruling that he was constructively dismissed by respondents. Our Ruling Petitioners substantial compliance calls for the relaxation of the rules. Therefore, the CA should have given due course to the petition. The three material dates which should be stated in the petition for certiorari under Rule 65 are the dates when the notice of the judgment was received, when a motion for reconsideration was filed and when the notice of the denial of the motion for reconsideration was received.26 These dates should be reflected in the petition to enable the reviewing court to determine if the petition was filed on time.27 Indeed, petitioners petition before the CA stated only the date of his receipt of the NLRCs Resolution denying his motion for partial reconsideration. It failed to state when petitioner received the assailed NLRC Decision and when he filed his partial motion for reconsideration. However, this omission is not at all fatal because these material dates are reflected in petitioners Partial Motion for Reconsideration attached as Annex "N" of the petition. In Acaylar, Jr. v. Harayo,28 we held that failure to state these two dates in the petition may be excused if the same are evident from the records of the case. It was further ruled by this Court that the more important material date which must be duly alleged in the petition is the date of receipt of the resolution of denial of the motion for reconsideration. In the case at bar, petitioner has duly complied with this rule. Next, the CA dismissed the petition for failure to attach an affidavit of service. However, records show that petitioner timely rectified this omission by submitting the required affidavit of service even before the CA dismissed his petition. Thirdly, petitioners failure to attach respondents motion for reconsideration to the assailed NLRC decision is not sufficient ground for the CA to outrightly dismiss his petition. The issue that was raised in respondents motion for reconsideration is the propriety of the NLRCs grant of overload honorarium in favor of petitioner. This particular issue was not at all raised in petitioners petition for certiorari with the CA, therefore, there is no need for

Petitioner filed a Motion for Reconsideration23 alleging that the material dates of receipt of the NLRC Decision and the filing of his motion for reconsideration are explicitly stated in his Partial Motion for Reconsideration which was attached as an annex to the petition and was made an integral part thereof. As to the absence of the affidavit of service, petitioner argued that there is no legal impediment for the belated admission of the affidavit of service as it was duly filed before the dismissal of the petition. As for his failure to attach respondents motion for reconsideration, petitioner manifested that a separate petition for certiorari has been filed by respondents and is pending with the CA, docketed as CA-G.R. SP No. 94205, where the denial of said motion is at issue. On August 4, 2006, the CA issued the following Resolution: Due to non-compliance despite opportunity afforded to comply, petitioners June 9, 2006 Motion for Reconsideration is hereby DENIED for lack of merit. SO ORDERED.24 Issues Hence, this petition assigning the following errors: THE HONORABLE COURT OF APPEALS PATENTLY COMMITTED REVERSIBLE ERROR IN DISMISSING THE PETITION FOR CERTIORARI [UNDER RULE 65] OF THE PETITIONER BY GIVING PRECEDENT TO TECHNICALITIES RATHER THAN THE MERITORIOUS GROUNDS ASSERTED THEREIN. THE PUBLIC RESPONDENT, NATIONAL LABOR RELATIONS COMMISSION, SERIOUSLY ERRED IN ITS CONSLUSIONS OF LAW IN RENDERING IT[S] ASSAILED DECISION AND RESOLUTION STATING THAT THE PETITIONER WAS NOT CONSTRUCTIVELY DISMISSED, THUS, NOT ENTITLED TO REINSTATEMENT, BACKWAGES, AND ATTORNEYS FEES.25

petitioner to append a copy of this motion to his petition. Besides, as already mentioned, the denial of respondents motion for reconsideration has been assailed by respondents before the CA docketed as CA-G.R. SP No. 94205. At any rate, the Rules do not specify the documents which should be appended to the petition except that they should be relevant to the judgment, final order or resolution being assailed. Petitioner is thus justified in attaching the documents which he believed are sufficient to make out a prima facie case.29 The Court has time and again upheld the theory that the rules of procedure are designed to secure and not to override substantial justice.30 These are mere tools to expedite the decision or resolution of cases, hence, their strict and rigid application which would result in technicalities that tend to frustrate rather than promote substantial justice must be avoided.31 The CA thus should not have outrightly dismissed petitioners petition based on these procedural lapses.1avvphi1 Petitioners transfer is not tantamount to constructive dismissal. Nevertheless, the instant petition merits dismissal on substantial grounds. After a careful review of the records and the arguments of the parties, we do not find any sufficient basis to conclude that petitioners re-assignment amounted to constructive dismissal. Constructive dismissal is quitting because continued employment is rendered impossible, unreasonable or unlikely, or because of a demotion in rank or a diminution of pay. It exists when there is a clear act of discrimination, insensibility or disdain by an employer which becomes unbearable for the employee to continue his employment.32 Petitioner alleges that the real purpose of his transfer is to demote him to the rank of an instructor from being the Head for Education performing administrative functions. Petitioner further argues that his re-assignment will entail an indirect reduction of his salary or diminution of pay considering that no additional allowance will be given to cover for board and lodging expenses. He claims that such additional allowance was given in the past and therefore cannot be discontinued and withdrawn without violating the prohibition against non-diminution of benefits. These allegations are bereft of merit. Petitioner was originally appointed as instructor in 1991 and was given additional administrative functions as Head for Education

during his stint in Laoag branch. He did not deny having been designated as Head for Education in a temporary capacity for which he cannot invoke any tenurial security. Hence, being temporary in character, such designation is terminable at the pleasure of respondents who made such appointment.33 Moreover, respondents right to transfer petitioner rests not only on contractual stipulation but also on jurisprudential authorities. The Labor Arbiter and the NLRC both relied on the condition laid down in petitioners employment contract that respondents have the prerogative to assign petitioner in any of its branches or tie-up schools as the necessity demands. In any event, it is management prerogative for employers to transfer employees on just and valid grounds such as genuine business necessity.34 It is also important to stress at this point that respondents have shown that it was experiencing some financial constraints. Because of this, respondents opted to temporarily suspend the post-graduate studies of petitioner and some other employees who were given scholarship grants in order to prioritize more important expenditures.35 Indeed, we cannot fully subscribe to petitioners contention that his re-assignment was tainted with bad faith. As a matter of fact, respondents displayed commiseration over the health condition of petitioners father when they suggested that he take an indefinite leave of absence to attend to this personal difficulty. Also, during the time when respondents directed all its administrative officers to submit courtesy resignations, petitioners letter of resignation was not accepted.36 This bolsters the fact that respondents never intended to get rid of petitioner. In fine, petitioners assertions of bad faith on the part of respondents are purely unsubstantiated conjectures. The Court agrees with the Labor Arbiter that there was no violation of the prohibition on diminution of benefits. Indeed, any benefit and perks being enjoyed by employees cannot be reduced and discontinued, otherwise, the constitutional mandate to afford full protection to labor shall be offended.37 But the rule against diminution of benefits is applicable only if the grant or benefit is founded on an express policy or has ripened into a practice over a long period which is consistent and deliberate.38 Petitioner was granted a monthly allowance for board and lodging during his stint as instructor in UNP-Vigan, Ilocos Sur as evinced in a letter dated June 6, 1992 with the condition stated in the following tenor:

Please be informed that during your assignment at our tie-up at UNP-VIGAN, ILOCOS SUR , you will be receiving a monthly Board and Lodging of Pesos: One Thousand Two Hundred x x x (P1,200.00). However, you are only entitled to such allowance, if you are assigned to the said tie-up and the same will be changed or forfeited depending upon the place of your next reassignment.39 (Italics supplied.) Petitioner failed to present any other evidence that respondents committed to provide the additional allowance or that they were consistently granting such benefit as to have ripened into a practice which cannot be peremptorily withdrawn. Moreover, there is no conclusive proof that petitioners basic salary will be reduced as it was not shown that such allowance is part of petitioners basic salary. Hence, there will be no violation of the rule against diminution of pay enunciated under Article 100 of the Labor Code.40 WHEREFORE, the Resolutions dated May 15, 2006 and August 4, 2006 of the Court of Appeals in CA-G.R. SP No. 93991 are SET ASIDE. The Decision dated August 25, 2005 and Resolution dated January 31, 2006 of the National Labor Relations Commission in NLRC Case No. RAB I-12-1242-03 (LC) insofar as it found respondents Data Center College of the Philippines and Wilfred Bactad not liable for constructive dismissal, are AFFIRMED. SO ORDERED.