Philippine Supreme Court Jurisprudence

This resolves the Petition for Review on Certiorari¹ assailing the Decision² dated October 16, 2009 and the Resolution³ dated March 29, 2010 of the Court of Appeals (CA) in CA-G.R. SP No. 106754 which reinstated with modification the first Decision⁴ dated March 28, 2007 of the National Labor Relations Commission (NLRC) in NLRC NCR CA No. 048226-06, finding Eduardo Pajarito (Pajarito) illegally dismissed, and set aside the NLRC's second Decision⁵ dated October 8, 2008, declaring Pajarito retrenched from service. The assailed Resolution denied reconsideration of the CA's assailed Decision.

Factual Antecedents

The undisputed facts, as culled from the Decision of the CA, are as follows:clubjuris

x x x Eduardo Pajarito was hired on March 9, 1999 by x x x company Unirock Corporation [Unirock] as a heavy equipment operator with a basic daily salary of P258.00.

On March 14, 2005, the company's vice-president for Human Resources Development (HRD), x x x Roberto Ignacio, issued a transfer order for [Pajarito] to work in Davao effective March 17, 2005 as his skill is needed in its job site operation. Together with the transfer, he was offered additional benefits like P1000.00 monthly relocation allowance and P50.00 daily meal allowance. [Unirock] also committed to shoulder his transportation fare and food on his way to the new place of work. Despite personal service of such order, [Pajarito] refused to receive the same. Hence, the transfer notice was sent through registered mail but [Pajarito] failed to receive it because he had moved out from his last known address. Immediately, [Unirock] issued a memorandum asking [Pajarito] to explain his refusal to accept the transfer. In the meantime, or on March 18, 2005, [Pajarito] filed a request for mediation and conciliation with the NLRC's Conciliation and Mediation Center.

On March 19, 2005, [Pajarito] submitted to [Unirock] his written explanation, the full text of which reads:clubjuris

Ako po si Eduardo Pajarito. Narito po ang aking paliwanag. Mula po ng natanggap ko yung kautusan sa Tagapangasiwa hindi ko po tinatanggihan ang kautusan sa Itaas, dahil malapit po ang aking magulang doon. Kaya nga lang po nagkaroon ng problem na, sinasabing tinanggihan ko po ang kautusan. Sa katunayan nga po nagpahanap na po [a]ko sa aking kapatid ng bahay ng malilipatan doon. Sa totoo po hindi po ako tumatanggi, ang ipinakikiusap ko po lang po [sic] sana ay patapusin ko po muna yung pag-aaral ng aking mga anak hanggang sa bakasyon po nila sa April 1, dahil hindi ko po sila pweding [sic] iwanan dahil nasa murang edad pa po sila [a]t wala pang tamang pagiisip, kailangan pa po nila ng kalinga [n]g isang magulang. Pangalawa po wala po akong kamag-anak [d]ito na pwedeng pag-iwanan sa kanila.

Paano po ninyo nasasabi na tinatanggihan ko po ang mga bagay na iyan, [a]t yung inaalok po ninyong relocation na P1,000.00 at allowance P50.00 sa tingin po ninyo sapat po kaya. Hindi po kaya malinaw na paglabag po ito sa human rights/karapatang pantao. Sa tingin po ninyo hindi kaya itoy isang harassment. Sa tingin ko po kasi panghaharass na po ito sa akin. Sana po ay maunawaan po ninyo ang aking panig. Maraming salamat po.

On March 31, 2005, [Unirock] issued a Memorandum of Termination against [Pajarito] effective that date, allegedly for willful disobedience to the transfer order, and abandonment of work for his unauthorized absences from March 17-30, 2005.

Hence, [Pajarito] filed a complaint for illegal dismissal on April 21, 2005, docketed as NLRC Case No. 00-04-03513-2005. [Pajarito] posited that his dismissal was without cause and lacked due process; that he did not disobey the order but only asked for time to allow his children to finish their schooling so he could bring his family to Davao; that the intended transfer was due to his suspected organization of a union; and, that he is entitled to reinstatement with full back wages, damages and attorney's fees, as well as wage differentials for the last three years of his employment.

[Unirock] maintained that respondent was given due notices for his transfer to the Davao project; that the company merely exercised its management prerogative in the questioned transfer; and, that he committed insubordination when he unjustly disobeyed such transfer, and neglect of duties when he incurred prolonged absence without leave which constituted valid grounds for his dismissal.⁶clubjuris

In the Decision⁷ dated November 29, 2005, Labor Arbiter Pablo C. Espiritu, Jr. dismissed the complaint for lack of merit. The Labor Arbiter found that Pajarito was validly terminated from employment on the ground of his willful insubordination to the lawful order of Unirock to transfer him to Davao and his absences without leave (AWOL) from March 17-31, 2005. Anent his claim of underpayment, the Labor Arbiter found no basis to sustain the same as his weekly gross payslips showed that his wages were paid beyond minimum wage, and that, in any case, his failure to raise the same in the sworn affidavit�having raised it only in his rejoinder�rendered the Labor Arbiter devoid of jurisdiction to entertain the same.⁸clubjuris

On Pajarito's appeal, the NLRC rendered the Decision⁹ dated March 28, 2009, disposing as follows:clubjuris

WHEREFORE, the assailed decision of the Labor Arbiter is accordingly REVERSED. Respondents-appellees are therefore hereby ordered to reinstate complainant Eduardo Pajarito to his former position with payment of full backwages and an indemnity in the amount of Php30,000.00.

SO ORDERED.¹⁰clubjuris

In finding for Pajarito, the NLRC found that the conduct of Pajarito of requesting additional time to implement his transfer cannot be considered a wrongful or perverse attitude, as would constitute willful disobedience. The NLRC, thus, held that the penalty of dismissal was too harsh and manifestly disproportionate to his alleged insubordination, which was excusable under the given circumstances. The NLRC also found that Pajarito was deprived of procedural due process for want of any written notice charging the latter of insubordination.

Unirock filed a motion for reconsideration¹¹ and supplemental motion for reconsideration¹² with a prayer to reinstate the November 29, 2005 Labor Arbiter Decision. On October 8, 2008, the NLRC rendered an amended Decision,¹³ the decretal part of which reads:clubjuris

WHEREFORE, we modify our Decision and declare that complainant was considered retrenched from work. Accordingly[,] he should be paid his retrenchment pay at half month pay per year of service plus financial assistance in the amount of P25,000.00.

SO ORDERED.¹⁴clubjuris

Pajarito elevated the case to the CA. On October 16, 2009, the CA rendered the herein assailed Decision,¹⁵ which disposed as follows:clubjuris

WHEREFORE, the petition is GRANTED. The assailed Decision dated October 8, 2008 of the NLRC is ANNULLED and SET ASIDE. The NLRC Decision dated March 28, 2007 is REINSTATED with MODIFICATION that petitioner is awarded separation pay (in lieu of reinstatement) equivalent to one month for every year of service from the date of hiring on March 9, 1999 and full backwages computed from the date of his illegal dismissal on March 17, 2005 until the finality of this decision.

SO ORDERED.¹⁶clubjuris

In the Resolution¹⁷ dated March 29, 2010, the CA denied Unirock's motion for reconsideration.

Hence, this petition was filed.

Unirock argues that the CA gravely erred when it delved into the legality of retrenchment especially when the same was never raised as a defense by the petitioner. It further argued that the CA gravely erred when it held that Pajarito was illegally dismissed on the ground that Pajarito's act of not reporting to work in Davao does not constitute insubordination and abandonment.

The petition lacks merit.

For one, the appellate court had cogent reason to delve into the matter of retrenchment, which constituted the very cause for which the termination of Pajarito from service was considered authorized by the NLRC in its second Decision, viz.:clubjuris

Be that as it may, complainant's intransigence to the lawful order of respondent company should not result in his dismissal from the service. We cannot see it as abandonment of work as he took steps to allegedly seek rectification of the perceived violation of his rights.

It would rather be equitable to grant him separation pay for retrenchment on account of his services of six (6) years at half month's pay for every year of service, a fraction of six (6) months being considered as one whole year.

In addition, as a matter of equity, and in order to tide complainant and his family over during the time that he is seeking a new employment, respondents should give him financial assistance in the amount of P25,000.00[.]¹⁸clubjuris

To state the obvious, it was the NLRC that unceremoniously declared the retrenchment of Pajarito despite the lack of basis therefor. Thus, in the exercise of its power in a certiorari proceeding to correct grave abuse of discretion, the CA imperatively passed upon the matter.

Aptly, the CA ruled that Pajarito cannot be validly separated from service on the ground of retrenchment, view of the absence of all the requisites thereof, consisting of the following: a) the retrenchment is necessary to prevent losses and such losses are proven; b) written notice to the employees and to the Department of Labor and Employment (DOLE) at least one month prior to the intended date of retrenchment; c) payment of separation pay equivalent to one month pay or at least � month pay for every year of service, whichever is higher.

This brings Us to the issue of gross insubordination and abandonment.

Under Article 297 [282]¹⁹ of the Labor Code, an employer may terminate the services of an employee who commits willful disobedience of the lawful orders of the employer:clubjuris

Article 297. [282] Termination by Employer. - An employer may terminate an employment for any of the following causes:

(a) Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or representative in connection with his work[.]

x x x x

For disobedience to be considered as just cause for termination, two requisites must concur: first, the employee's assailed conduct must have been willful or intentional, and second, the order violated must have been reasonable, lawful, made known to the employee and must pertain to the duties which he or she had been engaged to discharge. For disobedience to be willful, it must be characterized by a wrongful and perverse mental attitude rendering the employee's act inconsistent with proper subordination.²⁰clubjuris

In this case, the resolution of whether the foregoing requisites are present behooves this Court to correlate the same with some salient points laid down in our prior pronouncements concerning employment transfers.

In a number of cases, this Court has recognized and upheld the prerogative of management to transfer an employee from one office to another within the business establishment provided that there is no demotion in rank or a diminution of his salary, benefits and other privileges. This is a privilege inherent in the employer's right to control and manage its enterprise effectively. Even as the law is solicitous of the employees' welfare, it cannot ignore the right of the employer to exercise what are clearly and obviously management prerogatives. The freedom of management to conduct its business operations to achieve its purpose cannot be denied.²¹clubjuris

But like all other rights, there are limits. The managerial prerogative to transfer personnel must be exercised without grave abuse of discretion and putting to mind the basic elements of justice and fair play. Having the right should not be confused with the manner in which that right must be exercised. Thus, it cannot be used as a subterfuge by the employer to rid himself of an undesirable worker. Nor when the real reason is to penalize an employee for his/her union activities and thereby defeat his/her right to self-organization.²² To establish the validity of the transfer of employees, the employer must show that the transfer is not unreasonable, inconvenient, or prejudicial to the displaced employee; nor does it involve a demotion in rank or a diminution of his/her salaries, privileges and other benefits.²³clubjuris

Here, we agree with the CA that the time interval of three days from the issuance of the transfer order on March 14, 2005 to its effectivity on March 17, 2005 was too tight and prejudicial to Pajarito. Juxtaposed with the requisites of willful disobedience, the directive failed to satisfy the requirement of reasonableness. It is well to note that a work relocation from Greater Manila Area to a distant province like Davao requires a reasonable amount of time to work out certain details such as family living arrangements.

Notably, the belated claim of Unirock that the transfer was urgently required to meet the company's two-month deadline deserves no credence.²⁴ First, Unirock failed to substantiate the claim with proof when it could have easily presented the contract or timetable indicating the supposed deadline of its project. Time and again, this Court has ruled that mere allegation is not proof. Second, it was alleged for the first time only in Unirock's supplemental motion for reconsideration²⁵ of the NLRC's first Decision, despite the materiality thereof to petitioner's cause, thereby betraying its character as a mere afterthought.

Moving on to the other element of willful disobedience, We hold that Pajarito's plea for extension until April 1, 2005 to enable him to prepare his personal affairs, including his children's completion of their studies for the school year, does not constitute an intentional violation of the transfer order.

This Court is not unmindful of Our pronouncements²⁶ holding that difficulties for the family and parental obligations are not legitimate reasons for declining a transfer. But what obviously sets this case apart from those cases is the fact that Pajarito did not refuse the transfer order but merely requested for additional time to comply therewith. This is not to say, however, that a request for the extension of the period to effect a transfer automatically negates an employer's claim of insubordination, for every case must be determined based on the surrounding circumstances thereof.

Turning back to Our earlier discussion, We find no genuine reason why the period allotted for Pajarito to relocate from Metro Manila to Davao was too short, in the first place, and why it could not be extended at all. To reiterate, Unirock's belated and unsubstantiated claim of urgency deserves no credit. Under the circumstances of this case, Pajarito's plea to reschedule his transfer from March 17, 2005 to April 1, 2005, to enable his children to wrap up in school prior to his transfer, was reasonable and can hardly be considered as tainted with a perverse mental attitude, so as to amount to willful disobedience. We agree with the NLRC's pronouncement in its first Decision that the penalty of dismissal was too harsh.

Lastly, anent Unirock's claim of abandonment, this Court has consistently held that two elements must be present, to wit: (1) failure to report for work or absence without valid or justifiable reason; and (2) clear intention to sever the employment relationship manifested by some overt act.²⁷ Absence must be accompanied by overt acts unerringly pointing to the fact that the employee simply does not want to work anymore.²⁸ Furthermore, it is a settled doctrine that the filing of a complaint for illegal dismissal is inconsistent with abandonment of employment. An employee who takes steps to protest his/her dismissal cannot logically be said to have abandoned his/her work. The filing of such complaint is proof enough of his/her desire to return to work, thus negating any suggestion of abandonment.²⁹clubjuris

In this case, a review of the timeline belies the claim of abandonment. Pajarito clearly wasted no time in filing an illegal dismissal case against Unirock on April 21, 2005, after his termination on March 31, 2005. More tellingly, as early as March 18, 2005, he already filed a request for conciliation and mediation on his belief that he was already dismissed from employment at that time, since he was no longer allowed to report for work.

All told, neither just nor authorized cause exists to justify the termination of Pajarito. It follows then that he was illegally dismissed from work.

Finally, we sustain the award of separation pay in lieu of reinstatement. In a line of cases,³⁰ this Court deemed it proper to award separation pay in lieu of reinstatement, when a substantial amount of years have lapsed from the filing of the case to its finality. Considering that more than 15 years have passed since the institution of the instant case, the payment of separation pay is deemed more practical and appropriate to the parties concerned.

WHEREFORE, premises considered, the Petition is DENIED. The October 16, 2009 Decision and the March 29, 2010 Resolution of the Court of Appeals in CA-G.R. SP No. 106754 are hereby AFFIRMED. Respondent Eduardo Pajarito is deemed illegally dismissed. Petitioner Unirock Corporation and Roberto Ignacio are ordered to pay respondent his separation pay (in lieu of reinstatement) equivalent to one month for every year of service from the date of hiring on March 9, 1999 and full backwages computed from the date of his illegal dismissal on March 17, 2005 until the finality of this Decision.

SO ORDERED.

Leonen (Chairperson), Gesmundo, Carandang, and Zalameda, JJ., concur.clubjuris

Endnotes:

¹Rollo, pp. 12-32.

² Id. at 38-52; penned by Associate Justice Magdangal M. De Leon and concurred in by Associate Justices Martin S. Villarama, Jr. (now a retired member of this Court) and Ricardo R. Rosario.

³ Id. at 54-55; penned by Associate Justice Magdangal M. De Leon and concurred in by Associate Justices Ricardo R. Rosario and Antonio L. Villamor.

⁴ Id. at 111-118.

⁵ Id. at 130-138.

⁶ Id. at 39-41.

⁷ Id. at 87-94.

⁸ Id. at 91-94.

⁹ Id. at 111-118.

¹⁰ Id. at 117.

¹¹ Id. at 119-126.

¹² Id. at 127-129.

¹³ Id. at 130-138.

¹⁴ Id. at 138.

¹⁵ Id. at 38-52.

¹⁶ Id. at 51.

¹⁷ Id. at 54-55.

¹⁸ Id. at 137-138.

¹⁹ DOLE Department Advisory No. 001-15, Renumbering of the Labor Code of the Philippines, as amended.

²⁰Malcaba v. Prohealth Pharma Philippines, Inc., G.R. No. 209085, June 16, 2018, 864 SCRA 518, 555-556.

²¹Yuco Chemical Industries, Inc. v. Ministry of Labor and Employment, 264 Phil. 338, 341 (1990).

²² Id.

²³Pharmacia and Upjohn, Inc. (now Pfizer Philippines, Inc.) v. Albayda, Jr., 642 Phil. 680, 696 (2010).

²⁴ Id. at 31.

²⁵Rollo, pp. 127-129.

²⁶Allied Banking Corporation v. Court of Appeals, 461 Phil. 517 (2003). See also Phil. Telegraph Corp. v. Laplana, 276 Phil. 527 (1991).

²⁷MZR Industries, et al. v. Calambot, 716 Phil. 617, 627 (2014).

²⁸Doctor v. NII Enterprises, G.R. No. 194001, November 22, 2017, 846 SCRA 53, 70.

²⁹GSP Manufacturing Corp. v. Cabanban, 527 Phil. 452, 455 (2006).

³⁰Asso. of Independent Unions in the Phil. v. NLRC, 364 Phil. 697 (1999); G & S Transport Corporation v. Infante, 559 Phil. 701 (2007); San Miguel Properties Philippines, Inc. v. Gucaban, 669 Phil. 288 (2011).