Source: http://lawlibrary.chanrobles.com/index.php?option=com_content&view=article&id=83102:57097&catid=1584&Itemid=566
Timestamp: 2019-04-19 11:14:03+00:00

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G.R. No. 192011, June 30, 2014 - LIBCAP MARKETING CORP., JOHANNA J. CELIZ, AND MA. LUCIA G. MONDRAGON, Petitioners, v. LANNY JEAN B. BAQUIAL, Respondent.
LIBCAP MARKETING CORP., JOHANNA J. CELIZ, AND MA. LUCIA G. MONDRAGON, Petitioners, v. LANNY JEAN B. BAQUIAL, Respondent.
The law and jurisprudence allow the award of nominal damages in favor of an employee in a case where a valid cause for dismissal exists but the employer fails to observe due process in dismissing the employee. On the other hand, financial assistance is granted to a dismissed employee as a measure of equity or social justice, and is in the nature or takes the place of severance compensation.
Assailed in this Petition for Review on Certiorari1 are the April 22, 2009 Decision2 of the Court of Appeals (CA) in CA-G.R. SP No. 01794, entitled “Libcap Marketing Corporation, and/or Johanna J. Celiz, and Ma. Lucia G. Mondragon, Petitioners, versus National Labor Relations Commission and Lanny Jean B. Baquial, Respondents,” and its March 24, 2010 Resolution3 denying reconsideration thereof.
Petitioner Libcap Marketing Corporation (Libcap) is engaged in the freight forwarding business with offices in Iloilo City. Petitioner Johanna J. Celiz (Celiz) is Libcap’s Human Resources Division Head, and petitioner Ma. Lucia G. Mondragon is Libcap’s Vice-President for Administration.
Sometime in March 2003, an audit of Libcap’s Super Express branch in Cagayan de Oro City was conducted, and the resulting audit report5 showed that respondent made a double reporting of a single deposit made on April 2, 2001. In other words, a single April 2, 2001 bank deposit of P1,437.00 was used to cover or account for two days’ sales of apparently identical amounts, covering the undeposited collection for March 19, 2001 and current sales for March 31, 2001.
On July 28, 2003, respondent received a 2nd Notice of Administrative Investigation17 requiring her to attend an August 4, 2003 investigation in Iloilo City. Again, respondent failed to attend.
On August 16, 2003, respondent received a Notice of Termination20 dated August 9, 2003, stating that she was terminated from employment effective August 12, 2003 for dishonesty, embezzlement, inefficiency, and for commission of acts inconsistent with Libcap’s work standards.
Respondent filed a labor complaint for illegal dismissal against petitioners, which was docketed in the National Labor Relations Commission, Regional Arbitration Branch No. X, Cagayan de Oro City as NLRC Case No. RAB-10-08-00586-2003.
2) From August 16, 2003 to November 30, 2005 – (27.5) mos.
The other money claims are denied for lack of legal and factual basis.
In effect, the Labor Arbiter held that respondent was dismissed for just cause, but the dismissal was ineffectual as she was deprived of procedural due process; it was error for Libcap to schedule the July 28, 2003 investigation at its Iloilo office when it could very well have held it in Cagayan de Oro City. In other words, conducting the hearing in Iloilo City was tantamount to depriving respondent’s day in court, because she did not have the financial resources to go to Iloilo City.
In awarding backwages, the Labor Arbiter relied on the ruling in Serrano v. National Labor Relations Commission,23 which held that an employee dismissed for just cause but without notice need not be reinstated, but must be paid backwages from the time of termination until it is determined that his termination was for a just cause.
Both petitioners and respondent appealed to the NLRC, where the case was docketed as NLRC CA No. M-008999-2006.
WHEREFORE, in the light of the foregoing, both appeals are hereby DISMISSED. The assailed decision of the Labor Arbiter is hereby AFFIRMED in toto.
In a second Resolution26 dated May 31, 2007, petitioners’ Motion for Reconsideration27 was denied.
The NLRC affirmed the Labor Arbiter’s finding that respondent was deprived of due process when she was required to attend hearings in Iloilo City when she had limited financial resources, and given the fact that at the time, she had just given birth to her first-born child; petitioners, for humanitarian considerations, could have scheduled the hearings in Cagayan de Oro City instead. Furthermore, it held that the case cited and relied upon by petitioners – Agabon v. National Labor Relations Commission,28 which provided for the payment of nominal damages in lieu of backwages in case of dismissal where the employer fails to comply with the requirements of due process – could not be applied as it was promulgated only on November 17, 2004, while respondent’s Amended Complaint in NLRC Case No. RAB-10-08-00586-2003 was filed on September 1, 2003 or while the Serrano doctrine was not yet in effect.
In a Petition for Certiorari filed with the CA and therein docketed as CA-G.R. SP No. 01794, petitioners sought to nullify the Resolutions of the NLRC, arguing that the latter committed grave abuse of discretion and gross error in declaring that respondent’s right to due process was violated and in applying the Serrano case, instead of the doctrine in Agabon.
WHEREFORE, the assailed Resolution of the National Labor Relations Commission dated January 29, 2007 is AFFIRMED, with the MODIFICATION that the award of backwages is deleted. Petitioners are ordered to pay private respondent nominal damages in the amount of P100,000.00.
The CA held further that while the Agabon case, instead of the Serrano doctrine, should apply, respondent was nevertheless entitled to nominal damages in the amount of P100,000.00 considering that she was required to work beyond her scheduled or assigned hours of work without overtime pay, from date of hiring until she was terminated on August 12, 2003 – or for a period of four years.
THE COURT OF APPEALS ERRED WHEN IT RULED THAT THERE WAS NON-COMPLIANCE WITH THE PROCEDURAL DUE PROCESS REQUIREMENT WHEN THE RECORDS SHOW THAT THE RESPONDENT WAS GIVEN FULL OPPORTUNITY TO EXPLAIN THE CHARGES AGAINST HER.
(a) “ample opportunity to be heard” means any meaningful opportunity (verbal or written) given to the employee to answer the charges against him and submit evidence in support of his defense, whether in a hearing, conference or some other fair, just and reasonable way.
(b) a formal hearing or conference becomes mandatory only when requested by the employee in writing or substantial evidentiary disputes exist or a company rule or practice requires it, or when similar circumstances justify it.
Petitioners contend that so long as respondent was given the opportunity to be heard, which in fact she was afforded, then the twin-notice requirement is satisfied.
With regard to the award of nominal damages in the amount of P100,000.00, petitioners argue that the award is erroneous and respondent is not entitled to the same, given the nature and gravity of her offense. They cite the ruling in Philippine Airlines, Inc. v. National Labor Relations Commission,36 stating that if the reason for the valid dismissal is, for example, habitual intoxication or an offense involving moral turpitude, like theft, fraud, falsification or illicit sexual relations with a fellow worker, separation pay or financial assistance, or by whatever other name it is called, may not be allowed. They add that the CA’s conclusions that respondent worked long hours without overtime pay is not supported by evidence; thus, it could not grant nominal damages greater than P30,000.00, which is the amount fixed by the Court in a host of cases.
Petitioners thus pray that the Court declare that due process was properly observed in the dismissal of respondent, and that the award of nominal damages be deleted. In the alternative, they pray that the amount of nominal damages be reduced from P100,000.00 to P30,000.00.
In addition, petitioners contend in their Reply37 that respondent may no longer question the existence of just cause for her dismissal, as she did not raise the issue in an appropriate appeal or petition before the NLRC or the CA.
At this juncture, it must be stated that respondent’s failure to file an appropriate appeal or petition from the respective dispositions of the NLRC and the CA precludes her from questioning these dispositions at this stage. “The rule is clear that no modification of judgment could be granted to a party who did not appeal.”39 Thus, respondent’s pleas for reinstatement and the payment of backwages, cash bond, maternity leave benefits, moral damages, overtime pay, and attorney’s fees may no longer be taken up.
The CA, the NLRC and the Labor Arbiter are correct in concluding that respondent was denied due process, but their reasons for arriving at such conclusion are erroneous. What they seem to have overlooked is that respondent’s case has been pre-judged even prior to the start of the investigation on July 28, 2003. This is evident from the fact that the amount of P1,437.00 – or the amount which petitioners claim was embezzled – was peremptorily deducted each payday from respondent’s salary on a staggered basis, culminating on June 30, 2003, or nearly one month prior to the scheduled investigation on July 28, 2003. In doing so, petitioners have made it clear that they considered respondent as the individual responsible for the embezzlement; thus, in petitioners’ eyes, respondent was adjudged guilty even before she could be tried – the payroll deductions being her penalty and recompense.
By pre-judging respondent’s case, petitioners clearly violated her right to due process from the very beginning, and from then on it could not be expected that she would obtain a fair resolution of her case. In a democratic system, the infliction of punishment before trial is fundamentally abhorred. What petitioners did was clearly illegal and improper.
While it is correct to conclude that there was valid cause for dismissal considering that respondent did not contest the NLRC or CA findings to such effect through an appropriate appeal or petition, the only issue that remains to be tackled is the correctness of the award of nominal damages.
A dismissal for just cause under Article 282 implies that the employee concerned has committed, or is guilty of, some violation against the employer, i.e. the employee has committed some serious misconduct, is guilty of some fraud against the employer, or, as in Agabon, he has neglected his duties. Thus, it can be said that the employee himself initiated the dismissal process.
On another breath, a dismissal for an authorized cause under Article 283 does not necessarily imply delinquency or culpability on the part of the employee. Instead, the dismissal process is initiated by the employer’s exercise of his management prerogative, i.e. when the employer opts to install labor saving devices, when he decides to cease business operations or when, as in this case, he undertakes to implement a retrenchment program.
Accordingly, it is wise to hold that: (1) if the dismissal is based on a just cause under Article 282 but the employer failed to comply with the notice requirement, the sanction to be imposed upon him should be tempered because the dismissal process was, in effect, initiated by an act imputable to the employee; and (2) if the dismissal is based on an authorized cause under Article 283 but the employer failed to comply with the notice requirement, the sanction should be stiffer because the dismissal process was initiated by the employer’s exercise of his management prerogative.
Since in the case of JAKA, the employee was terminated for authorized causes as the employer was suffering from serious business losses, the Court fixed the indemnity at a higher amount of P50,000.00. In the case at bar, the cause for termination was abandonment, thus it is due to the employee’s fault. It is equitable under these circumstances to order the petitioner company to pay nominal damages in the amount of P30,000.00, similar to the case of Agabon.
We affirm the award of salary differentials, 13th month pay and holiday pay, awarded by the NLRC and the Court of Appeals. We note that although petitioner company had cause to terminate Madriaga, this has no bearing on the issue of award of salary differentials, holiday pay and 13th month pay because prior to his valid dismissal, he performed work as a regular employee of petitioner company, and he is entitled to the benefits provided under the law. Thus, in the case of Agabon, even while the Court found that the dismissal was for a just cause, the employee was still awarded his monetary claims.
An employee should be compensated for the work he has rendered in accordance with the minimum wage, and must be appropriately remunerated when he was suffered to work on a regular holiday during the time he was employed by the petitioner company. As regards the 13th month pay, an employee who was terminated at any time before the time for payment of the 13th month pay is entitled to this monetary benefit in proportion to the length of time he worked during the year, reckoned from the time he started working during the calendar year up to the time of his termination from the service.
WHEREFORE, the Petition is GRANTED IN PART. The assailed April 22, 2009 Decision and March 24, 2010 Resolution of the Court of Appeals in CA-G.R. SP No. 01794 are AFFIRMED with MODIFICATION that the award of nominal damages is reduced to P30,000.00.
** Per Special Order No. 1712 dated June 23, 2014.
*** Per Special Order No. 1696 dated June 13, 2014.
2 Id. at 25-34; penned by Associate Justice Michael P. Elbinias and concurred in by Associate Justices Rodrigo F. Lim, Jr. and Ruben C. Ayson.
3 Id. at 36-38; penned by Associate Justice Rodrigo F. Lim, Jr. and concurred in by Associate Justices Leoncia R. Dimagiba and Angelita A. Gacutan.
6 Id. at 26. Apparently, there is a conflict regarding the dates for which the deposit slip for P1,437.00 was used to cover apparent sales. While the audit report points to March 19 and 31, 2001, Celiz’s March 28, 2003 letter claims that the deposit slip was used to cover sales for March 31 and April 1, 2001. Nonetheless, the conclusion that is necessarily arrived at is that there is failure to deposit Libcap’s daily sales collections for one day.
9 Id. at 42, 81.
14 Id. at 29, 81.
19 Id. at 62, 108.
23 380 Phil. 416 (2000).
24Rollo, pp. 90-93; penned by Presiding Commissioner Salic B. Dumarpa and concurred in by Commissioners Proculo T. Sarmen and Jovito C. Cagaanan.
26 Id. at 110-111; penned by Presiding Commissioner Salic B. Dumarpa and concurred in by Commissioner Proculo T. Sarmen.
28 485 Phil. 248 (2004).
33 602 Phil. 522 (2009).
36 384 Phil. 828 (2000).
39Loy, Jr. v. San Miguel Corporation Employees Union-Philippine Transport and General Workers Organization (SMCEU-PTGWO), G.R. No. 164886, November 24, 2009, 605 SCRA 212, 230.
40De Jesus v. Aquino, G.R. No. 164662, February 18, 2013, 691 SCRA 71, 89, citing Culili v. Eastern Telecommunications Philippines, Inc., G.R. No. 165381, February 9, 2011, 642 SCRA 338, 366; RTG Construction, Inc. v. Facto, G.R. No. 163872, December 21, 2009, 608 SCRA 615, 623; Coca-Cola Bottlers Philippines, Inc. v. Garcia, 567 Phil. 342, 353-354 (2008); Magro Placement and General Services v. Hernandez, 553 Phil. 374, 384-385 (2007); King of Kings Transport, Inc. v. Mamac, 553 Phil. 108, 118-119 (2007).
41Samahan ng mga Manggagawa sa Hyatt (SAMASAH-NUWHRAIN) v. Magsalin, G.R. Nos. 164939 & 172303, June 6, 2011, 650 SCRA 445, 458; Luna v. Allado Construction Co., Inc., G.R. No. 175251, May 30, 2011, 649 SCRA 262, 275-278.
42Fontana Resort and Country Club, Inc. v. Tan, G.R. No. 154670, January 30, 2012, 664 SCRA 382, 399, citing Almeda v. Cariño, 443 Phil. 182, 191 (2003).
43Dela Rosa v. Michaelmar Philippines, Inc., G.R. No. 182262, April 13, 2011, 648 SCRA 721, 733; Galaxie Steel Workers Union (GSWU-NAFLU-KMU) v. National Labor Relations Commission, 535 Phil. 675, 686 (2006).
44Mantle Trading Services, Inc. v. National Labor Relations Commission, G.R. No. 166705, July 28, 2009, 594 SCRA 180, 191-193, citing JAKA Food Processing Corporation v. Pacot, 494 Phil. 114, 120-121 (2005).

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