Just and Authorized Causes

Question 1

What are the just causes of Dismissal?

Answer 1

a) Serious Misconduct and Willful Disobedience by an employee of the lawful orders of his employer or representative in connection with his work; (SMWD)
b) Gross and Habitual Neglect by the employee of his duties; (GHN)
c) Fraud and other Willful Breach of the Employee of the Trust reposed in him by the employer or his authorized representative; (FWBT)
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 representative; (CCOE)
e) Other analogous cases to the foregoing (ANAL)

Question 2

What is the nature of the right to dismiss?

Answer 2

The right of the company to dismiss is a measure of self-protection. The law protecting the right of the laborer authorizes neither oppression nor self-destruction of the employer.

Question 3

What are the limitations of the power to dismiss?

Answer 3

It must be exercised in good faith for the advancement of the employer’s interest and not for the purpose of defeating of circumventing the rights of the employees under special laws and valid agreements. Such prerogative to dismiss or lay off an employee must be exercised without abuse of discretion. (GF)

Dismissal is the ultimate penalty that can be meted to an employee. Even where the worker has committed an infraction, a penalty less punitive may suffice whatever missteps may be committed by labor ought not to be visited with a consequence so severe.

Question 4

Define Misconduct.

Answer 4

Misconduct is improper and wrong conduct. It is the transgression of some established and definite rule of action, a forbidden act, a dereliction of duty, willful in character, and implies wrongful intent and not mere error in judgment.

This misconduct to be serious within the meaning of the Labor Code, must be of such grave and aggravated character and not merely trivial or unimportant.

Question 5

What is the requisite for misconduct or improper behavior to be a just cause for dismissal?

Answer 5

a) It must be serious;
b) It must relate to the performance of the employee’s duties;
c) It must show that the employee has become unfit to continue working for the employer;

The employer may dismiss an employee if the former has reasonable grounds to believe or to entertain the moral conviction, that the latter is responsible for the misconduct and the nature of his participation therein renders him absolutely unworthy of the trust and confidence demanded by his position.

Question 6

What should an employee properly do if he wants to unburden himself of his disappointments?

Answer 6

Accusatory and inflammatory language by an employee towards his employer or superior can be a ground for dismissal or termination.

“An aggrieved employee who wants to unburden himself of his disappointments and frustrations in his job or relations with his immediate superior would normally approach said superior directly or otherwise ask some other officer possibly to mediate and discuss the problem with the end view of settling their differences without causing ferocious conflicts. No matter how the employee dislikes his employer professionally, and even if he is in a confrontational disposition, he cannot afford to be disrespectful and dare to talk with an unguarded tongue and/or with a baleful pen.”

Question 7

What are the 2 classes of corporate positions of trust?

Answer 7

1. Managerial employees – the primary duty consist of the management of the establishment in which they are employed or of a department or a subdivision thereof, and other officers or members of the managerial staff;
2. Fiduciary rank and file employees – such as cashiers, auditors, property custodians, or those in the normal exercise of their functions, regularly handle significant amounts of money or property. These employees, though rank and file are routinely charged with the care and custody of the employer’s money or property, and are thus classified as occupying positions of trust and confidence.

Question 8

What are the requisites for loss of trust and confidence be a valid ground for termination?

Answer 8

1. The employee holds a position of trust and confidence; and
2. The act complained against justifies the loss of trust and confidence;

The firs requisite mandates that the erring employee must be holding a position of trust and confidence. Loss of trust and confidence is not a one size-fits-all cause that can be applied to all employees without distinction on their standing in the work organization. Distinction yet should be made as to what kind of position of trust is the employee occupying.

Question 9

What is the cardinal rule in loss of trust and confidence?

Answer 9

It is a cardinal rule that loss of trust and confidence should be genuine and not simulated. It must arise from dishonest or deceitful conduct, and must not arbitrarily asserted in the face of overwhelming contrary evidence. While proof beyond reasonable doubt is not required: loss of confidence must have some basis or such reasonable ground for one to believe that the employee committed the infraction, and the latter’s participation makes him totally unworthy of the trust demanded to such position. (Julieta Sta. Ana vs. Manila Jockey Club, G.R. No. 208459, February 15, 2017)

Question 10

Is pecuniary gain a necessary element of termination on account of loss of trust and confidence?

Answer 10

No. Even the return of the misappropriated funds will not negate valid dismissal for breach of trust. This court has held that misappropriation of company funds, although shortages have been validly restored is a valid ground to terminate employment for loss of trust and confidence.

Question 11

Is Damage a necessary element to the loss of trust and confidence as ground for termination of employment?

Answer 11

No. Damage to the respondents or whether or not respondents were defrauded is not a necessary element and consideration in determining whether sufficient basis exists to justify the employees dismissal on grounds of serious misconduct or serious loss of trust.

To reiterate, the employer need only to entertain the moral conviction or such reasonable grounds to believe, that the employee is responsible for the misconduct and the nature of the latter’s participation renders him unworthy of trust and confidence demanded by the position; that the act resulting in the loss of trust or misconduct is established by facts; and that the act or misconduct is willfully made, i.e. the employee voluntarily and willfully committed the act, although he may not have intended the wrongful consequence. (Debra Anne Gaite vs. Filipino Society of Composers, Authors and Publishers Inc., G.R. No. 219324, August 8, 2018)

Question 12

Is failure to reach quota a breach of trust?

Answer 12

No. The failure to reach the monthly sales quota cannot be considered intentional and unjustified act of the respondent amounting to willful breach of trust on his part that would call for his termination based on loss of confidence. Indeed, the low sales performance could be attributed to several factors which are beyond the respondent’s control. To be valid ground for an employee’s dismissal loss of trust and confidence must be based on willful breach. To repeat, a breach is willful if it is done intentionally, knowingly, purposely without justifiable excuse (Norkis Distributors vs. Descallar, G.R. No. 185255, March 14, 2012)

Question 13

Does the security guard’s admission that he did not lock properly the man door before he went on his roving patrol amount to breach of trust and confidence?

Answer 13

No. Such breach to be a ground for termination, must be willful, that is, it must be done intentionally, knowingly, and purposely, without justifiable excuse as distinguished from an act done carelessly, thoughtlessly, heedlessly or inadvertently.

Question 14

Distinguish the loss of trust and confidence as basis for valid dismissal of a managerial employee and that of a rank and that of fiduciary rank and file employee

Answer 14

A managerial employee could be terminated on the ground of loss of confidence by mere existence of a basis for believing that he had breached the trust of his employer. Proof beyond reasonable doubt is not required. It would be sufficient that there is some basis for such loss of confidence, such as when the employer has reasonable ground to believe that the concerned employee is responsible for the purported misconduct and the nature of his participation therein.

This distinguishes a managerial employee from a fiduciary rank and file where loss of confidence as ground for valid dismissal, requires proof of involvement in the alleged events in question and that mere uncorroborated assertion or accusation by the employer will not be sufficient. (PJLI vs. Hector Oriel Cimagala Camacho, G.R. No. 223073, February 22, 2017)

Question 15

What are the determinants for a particular conduct as immoral?

Answer 15

1) A consideration of the totality of the circumstances surrounding the conduct;

2) An assessment of these circumstances in the light of the prevailing norms of conduct, i.e. what the society generally considers moral and respectable and the applicable laws.
In general, in determining whether the acts complained of constitutes “disgraceful and immoral” behavior under our laws, the distinction between public and secular morality on the one hand, and religious morality on the other hand, should be kept in mind.

Question 16

When breach of trust is willful?

Answer 16

The 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.

We clarify, however, that it is the breach of the employer’s trust, not the specific employee acts which the employer claims caused the breach, which the law requires to be willful, knowingly, and purposefully done by the employee to justify the dismissal on the ground of loss of trust and confidence.

Question 17

What are the guidelines for the application of the doctrine of loss of confidence?

Answer 17

1) The loss of confidence should not be simulated;
2) It should not be used as a subterfuge for causes which are improper, illegal, or unjustified;
3) It should not be arbitrarily asserted in the face of overwhelming evidence to the contrary;
4) It must be genuine, not a mere afterthought to justify earlier action taken in bad faith;
5) The employee holds a position of trust and confidence;

In short, there must be an actual breach of duty which must be established by substantial evidence.

Question 18

Is proof beyond reasonable doubt required for breach of trust and confidence be proved?

Answer 18

No. In administrative and quasi-judicial proceedings, the quantum of evidence required as substantial evidence. Substantial evidence is the relevant evidence a reasonable mind might accept as adequate to support a conclusion.

Question 19

What constitutes immoral conduct?

Answer 19

It is a conduct which is so willful, flagrant, and shameless as to show indifference to the opinion of the good and respectable member of the community.

Such conduct must not only be immoral, but grossly immoral. That is it must be so corrupt as to constitute a criminal act or so unprincipled as to be reprehensible to a high degree or committed under scandalous or revolting circumstance as to shock the common sense of decency.

Question 20

When is there Willful Disobedience?

Answer 20

When is there Willful Disobedience?
A: In order that the willful disobedience by the employee may constitute a just cause for terminating his employment, the orders, regulations, or instructions of the employer or representative must be:

1) Reasonable and lawful;
2) Sufficiently known to the employee; and
3) In connection with the duties which the employee has been engaged to discharge;

Where the order or rule is not reasonable, in view of the terms of the contract of employment and the general rights of the parties, a refusal to obey does not constitute a just cause for the employee’s discharge.

Question 21

What is reasonable order or rule?

Answer 21

As to what is reasonable order or rule will depend on the circumstances of each case. Reasonableness however has reference not only to the kind and character of directions and commands but also to the manner in which they are made. The employee’s disobedience in order to justify dismissal must relate to substantial matters not merely trivial or unimportant matters, not merely trivial or unimportant matters. Further, disobedience to be considered willful must be resorted to without regard of the consequence.

Question 22

Discuss Preventive Suspension under the Labor Code.

Answer 22

Preventive suspension is a disciplinary measure for the protection of the company’s property pending investigation of any alleged malfeasance or misfeasance committed by the employee. However, when it is determined that there is no sufficient basis to justify an employee’s preventive suspension, the latter is entitled to the payment of salaries during the time of preventive suspension.

Question 23

When employer may impose Preventive Suspension?

Answer 23

The employer may place the worker concerned under preventive suspension if his continued employment poses a serious and imminent threat to the life or property of the employer and his co-workers.

Question 24

What is the period of Period of Suspension?

Answer 24

“No preventive suspension shall last longer than thirty (30) days.” The employer shall thereafter reinstate the worker in his former or in a substantially equivalent position or the employer may extend the period of suspension provided that during the period of extension, he pays the wages and other benefits due to the worker.

In such case, the worker shall not be bound to reimburse the amount paid to him during the extension if the employer decides, after completion of the hearing, to dismiss the worker.

Question 25

What is the rule in imposing the 30-day limit for a Preventive Suspension?

Answer 25

While the Omnibus Rules limits the period of preventive suspension to thirty (30) days, such time frame pertains only to one offense by the employee.
For an offense, it cannot go beyond 30 days. However, if the employee is charged with another offense, then the employer is entitled to impose a preventive suspension not to exceed 30 days specifically for the new infraction.

Indeed, a fresh preventive suspension can be imposed for a separate or distinct offense. Thus, the employer is well within his rights to preventively suspend an employee for other wrongdoings that may be later discovered while the first investigation is ongoing.

Question 26

Does Preventive Suspension amounts to a Constructive Dismissal?

Answer 26

An employee is considered to be constructively dismissed from service if an act of clear discrimination, insensibility, or disdain by an employer has become so unbearable to the employee as to leave him or her with no option but to forego with his or her continued employment.

“When the preventive suspension exceeds the maximum period allowed without reinstating the employee either by actual or payroll reinstatement or when preventive suspension is for an indefinite period, only then will constructive dismissal set in.”

Question 27

Mamaril questions the propriety of his preventive suspension by claiming that the timing of its imposition was suspect, as he even continued working for Red System for eight months after the incident. According to Mamaril, this fact belied Red System’s claim that he was a threat to the company’s safety.

Answer 27

In Bluer Ventures Company vs. Esteban, it was held that even if the errant employee committed the acts complained of almost a year before the investigation was conducted, the employer shall not be estopped from placing the former under preventive suspension, if the employee still performs functions that involve handling the employer’s property and funds.

Question 28

May an employee be dismissed for being married to a co-employee?

Answer 28

No. The failure of the employee to prove a legitimate business concern in imposing the questioned policy cannot prejudice the employee’s right to be free from arbitrary discrimination based on stereotypes of married persons working together in one company.

Question 29

Is “ignorance of the law” principle applicable in private enterprise?

Answer 29

No. To justify punishment of employee for disobeying company policy, it is essential to show that the employee know such policy and that its violation is punishable.
As Fr. Bernas says, “due process which is a rule of fairness requires that those who must obey the command must first know the command.”

Question 30

Is an employee bound by a policy initiated after he was hired?

Answer 30

Yes. The employer may change company policy even after the employees are hired. Such amended policy becomes an implied contract between the employer and the employees if the latter continues to work while such amended policy is in effect. The implied contract binds both the employer and the employees.

Question 31

What is the basis of a Valid Transfer Order?

Answer 31

Management has the right to transfer or reassign an employee. This right flows from the ownership and from the established rule that labor law does not authorized the substitution of judgment of the employer in the conduct of his business, unless it is shown to be contrary to law, morals or public policy.

The right of the employer to transfer his employees in the interest of efficient and economic operation of its business cannot be seriously challenged. That is his prerogative. But there must be no malice. The employer cannot exercise this right where it is vitiated with improper motive and is merely a disguised attempt to remove or punish an employee sought to be transferred.

Question 32

An employee was on 30-day suspension while being investigated for loss of important company records. After serving suspension, the employee was reassigned to another project without diminution of salary and was given transportation allowance though inadequate. She eventually stopped reporting and filed a constructive dismissal case.

Answer 32

The purpose of the reassignment is no different from that of preventive suspension which management could validly imposed as a disciplinary measure for the protection of company property pending investigation of any alleged malfeasance or misfeasance committed by the employee. The transfer may indeed cause personal inconvenience or hardship to the employee but unless known to be motivated by bad faith, the transfer must be upheld as valid exercise of management prerogative.

Question 33

Discuss the implication of floating status.

Answer 33

With respect to cases involving security guards, a relief and transfer order in itself does not sever employment relationship between a security guard and his agency. An employee has the right to security of tenure but this does not give him a vested right to his position as his assignment or transfer him where his service as security guard, will be most beneficial to the client.

“Temporary off detail” or the period of time security guards are made to wait until they are transferred or assigned to a new post or client does not constitute constructive dismissal, so long as such status does not continue beyond 6 months. The onus of proving that there is no post available to which the security guard can be assigned rests on the employer.

Question 34

Should a security guard under “off detail” or “floating status” entitled to payment of salary?

Answer 34

No. Case law provides that the concept of temporary “off-detail” or “floating status” of security guards employed by private security agencies – a form of a temporary retrenchment or lay-off-relates to the period of time when security guards are in between assignments or when they are made to wait after being relieved from a previous post until they are transferred to a new one. As the circumstance is generally outside the control of the security agency or employer, the Court has ruled that when a security guard is placed on a “floating status,” he or she does not receive any salary or financial benefit provided by law.

Question 35

What is the nature of placing a security guard in temporary ‘off detail” or floating status?

Answer 35

It is part of management prerogative of the employer-security agency and does not per se, constitute a severance of the employer-employee relationship. However, being an exercise of management prerogative, it must be exercised in good faith-that is, one which is intended for the advancement of the employer’s interest and not for the purpose of defeating or circumventing the rights of the employees under special laws or under valid agreements.

Question 36

How management prerogative be exercised?

Answer 36

It is within the ambit of the employer’s prerogative to transfer an employee for valid reasons and according to the requirement of business provided that the transfer does not result in demotion in rank and diminution of salary, benefits and other privileges. This court has always considered management prerogative to transfer its employees in pursuit of legitimate interest. But this prerogative should be exercised without grave abuse of discretion and with due regard to the basic elements of justice and fair play such that if there is showing that the transfer was unnecessary or inconvenient and prejudicial to the employee, it cannot be upheld.

It cannot be used as a subterfuge by the employer to get rid himself of an undesirable worker.

Question 37

May an employee disobey an inconvenient transfer?

Answer 37

No. Absent any showing of bad faith on the part of the employer in effecting the transfer, an employee’s refusal to obey transfer orders constitute willful disobedience of a lawful order of employer and warrants a dismissal.

Question 38

In what instance when inconvenient transfer be properly objected to?

Answer 38

When the inconvenience resulted from the unreasonable transfer order of the company making the order itself invalid and disobedience thereof not a ground for dismissal. While mere inconvenience does not justify disobedience to transfer order, the transfer order itself becomes flawed and unenforceable if it fails the criteria of lawfulness and reasonableness. Reasonableness pertains to the kind of directives and commands and to the manner in which they are made.

Question 39

What constitutes Constructive Dismissal?

Answer 39

It is a quitting because continued employment is rendered impossible, unreasonable and unlikely; as an offer involving demotion in rank or diminution in salary.

Likewise, constructive dismissal exists when an act of clear discrimination, insensibility, or disdain by an employer has become so unbearable to the employee leaving him with no option but to forego with his continued employment. D-I-D

Question 40

What is rule regarding promotion?

Answer 40

There is no law that compels an employee to accept a promotion as a promotion is in the nature of a gift or a reward, which a person has a right to refuse. When petitioner refused to accept his promotion as Director for International Sales, he was just exercising his right and he cannot be punished for he who uses his own legal right injures no one. Also, the fact that the petitioner is a managerial employee does not by itself exclude him from the protection of the constitutional guarantee of security of tenure.

Question 41

What is the procedure to determine voluntariness of an employee’s resignation?

Answer 41

The intention to relinquish an office must concur with the overt act of relinquishment. The act of the employee before and after the alleged resignation must be considered to determine whether in fact, he or she intended to relinquish such employment.

If the employer introduce evidence purportedly executed by an employee as proof of voluntary resignation and the employee specifically denies the authenticity and due execution of said document, the employer is burdened to prove the due execution and genuineness of such document.

Question 42

What constitutes “Abandonment?”

Answer 42

To constitute abandonment, there must be a clear and deliberate intent to discontinue one’s employment without intention of returning back

Question 43

What are the elements of Abandonment?

Answer 43

1) The employee must have failed to report for work or must have been absent without valid and justifiable reason;

2) There must have been a clear intention on the part of the employee to sever the employer-employee relationship manifested by some overt act;
The burden to prove whether the employee abandoned his or her work rest on the employer.

The mere absence or failure to report for work, even after notice to return, does not necessarily amount to abandonment. Abandonment is a matter of intention and cannot be lightly be presumed from certain equivocal acts.

Question 44

What is the effect of the failure to establish that the employees were actually notified or informed that they were being ordered to report back to work?

Answer 44

Without proof that respondents were aware of their new assignments or were being ordered to report back for duty, it cannot be said that the employee failed to report for work. There is therefore, no showing of any overt act of the respondents that would point to an intention to abandon their work. On the contrary, since respondents almost immediately filed a complaint for illegal dismissal after they were relieved of duty, there is a clear indication that they had the desire to continue with their employment.

“Xxx Employees who take steps to protest their dismissal cannot logically be said to have abandoned their work. A charge of abandonment is totally inconsistent with the immediate filing of a complaint for illegal dismissal. The filing thereof is proof enough of one’s desire to return to work thus negating any suggestion of abandonment.”

Question 45

What is the rule with regards to absenteeism and tardiness?

Answer 45

They are forms of neglect of duty and thus valid causes for dismissal.

However, in a case, the court ruled that the employee’s three counts of tardiness cannot be considered gross and habitual neglect of duty. The infrequency of his tardiness removes the character of habitualness. These late attendances were so broadly spaced out negating the complete absence of care in the performance of duties.

Question 46

Is attitude problem a just cause to dismiss an employee?

Answer 46

Yes. An employee who cannot get along with his co-employees is detrimental to the company, for he can upset and strain the working environment. When the differences between the employees and management affect work environment, the peace of the company is affected. Thus, an employee’s attitude is a valid ground for termination.

However, it is a situation analogous to loss of trust and confidence that must be duly proved by the employer. Similarly, compliance with the twin requirement of notice and hearing must also be proven by the employer, thus the mere mention of negative feedback from her team members and letters are not proof of her attitude problem.

Question 47

What is the effect of prayer for separation and not for reinstatement?

Answer 47

It showed employee’s intention to sever ties with his employers, including the employee’s contemporaneous conduct, and not only because of his prayer for separation pay. (Sheryll Cabanas vs. Abelardo Luzano Law Office, G.R. No. 225803, July 2, 2018)

Question 48

What will make fraud or willful breach of the employee of the trust reposed in him a just cause for termination?

Answer 48

The fraud must be committed against the employer or representative and in connection with employer’s work. Thus, the fraud committed by an employee against third persons not in connection with his work and which does not in any way involve his employer is not a ground for the dismissal of the employee. Furthermore, since fraud implied willfulness or wrongful intent, the innocent non-disclosure of facts by the employee to the employer will not constitute a just cause for the dismissal of the employee.

Question 49

Define Dishonesty.

Answer 49

It is the disposition to lie, cheat, deceive or defraud; untrustworthiness, lack of integrity, lack of honesty, probity or integrity; in principle; lack of fairness; and straightforwardness; disposition to fraud, deceive and betray.

Question 50

Does ‘Paluwagan” among employees and non-payment thereof constitute serious misconduct?

Answer 50

No. If there was misappropriation or loss of the said mutual fund, the respondent will not and cannot be in any way tend to cause prejudice to the club. Such mutual fund is a separate transaction among employees and is not in any way connected with employee’s work.

Question 51

Discuss Commission of a crime or offense as a just cause for dismissal.

Answer 51

It must be commission of a crime against the person of the employer or against any member of his immediate family. Immediate member of his family include spouse, ascendants, descendants, or legitimate, natural or adopted brothers and sisters of the employer or of his relative by affinity in the same degrees and those by consanguinity within the fourth civil degree.

Question 52

Is conviction necessary for this ground?

Answer 52

No. The conviction of an employee in a criminal case is not indispensable to warrant his dismissal by his employer, the fact that a criminal complaint has been dropped by the fiscal is not binding and conclusive upon the labor tribunal.

Question 53

What constitutes “analogous cases?”

Answer 53

To be considered analogous to the just cause enumerated, however, a cause must be due to the voluntary or willful act or omission of the employee.

Question 54

Is contract based dismissal valid?

Answer 54

Yes, provided it must not be contrary to law, morals, good customs, public policy and public order. The employment contract is governed by Philippine labor laws. Hence, stipulations, clauses and terms and conditions of the contract must not contravene our labor law provisions.

Question 55

Is a contractual agreement with obligation to stay in service after training grant valid?

Answer 55

Yes. It is a valid contractual commitment that binds the employee. Enforcing agreement accords with the law on contract and is a valid exercise of management prerogative.

Question 56

Is a no compete undertaking valid?

Answer 56

Yes. In cases where an employee assails a contract as against public policy because it contains a provision prohibiting him or her from accepting competitive employment, the employer has to adduce evidence to prove that the restriction is reasonable and not greater than necessary to protect the employer’s legitimate business interests.

Question 57

What is the validity of the No Hiring Agreement or No Piracy Agreement?

Answer 57

: It is an unreasonable restraint in trade and therefore unenforceable. The effect of no hire provision is to restrict employment. For the no-hire covenant to be enforceable, it must comply with the following requisites:

1) Necessary to protect the employer;
2) Provide a reasonable time limit;
3) Provide a reasonable territorial limit;
4) Not to be harsh or oppressive to the employee;
5) Not be contrary to public policy;

Question 58

Discuss enforcement of union security clause

Answer 58

Removing an employee on the basis of such clause is a delicate matter that the employer should face cautiously. The substantive and procedural aspect of due process in relation to tenurial security are not bargained away even in a collective contract with employee’s union.

Question 59

What is the basic principle in Illegal Dismissal cases?

Answer 59

It is a basic principle in illegal dismissal cases that the employees must first establish by competent evidence the fact of their termination from employment. In this regard, mere allegation does not suffice, evidence must be substantial and the fact of dismissal must be clear, positive and convincing.

Question 60

What is Management Prerogative?

Answer 60

It is the employer’s inherent right to control and manage effectively its enterprise and do not normally allow interference with the employer’s judgment in the conduct of his business.
Management has exclusive prerogatives to determine the qualifications and fitness of workers for hiring and firing, promotion or reassignment. It is only in instances of unlawful discrimination, limitations imposed by law and collective bargaining can this prerogative of management be reviewed.