Source: http://lawlibrary.chanrobles.com/index.php?option=com_content&view=article&id=83181:57156&catid=1584&Itemid=566
Timestamp: 2019-04-25 02:25:04+00:00

Document:
G.R. No. 202996, June 18, 2014 - MARLO A. DEOFERIO, Petitioner, v. INTEL TECHNOLOGY PHILIPPINES, INC. AND/OR MIKE WENTLING, Respondents.
MARLO A. DEOFERIO, Petitioner, v. INTEL TECHNOLOGY PHILIPPINES, INC. AND/OR MIKE WENTLING, Respondents.
We resolve the petition for review on certiorari1 filed by petitioner Marlo A. Deoferio to challenge the February 24, 2012 decision2 and the August 2, 2012 resolution3 of the Court of Appeals (CA) in CA-G.R. SP No. 115708.
On appeal by Deoferio, the National Labor Relations Commission (NLRC) wholly affirmed the LA’s ruling.23 The NLRC also denied24 Deoferio’s motion for reconsideration,25 prompting him to seek relief from the CA through a petition for certiorari under Rule 65 of the Rules of Court.
In their Comment,29 the respondents posit that the petition raises purely questions of fact which a petition for review on certiorari does not allow. They submit that Deoferio’s arguments have been fully passed upon and found unmeritorious by the lower tribunals and by the CA. They additionally argue that Deoferio’s subsequent employment in other corporations is irrelevant in determining the validity of his dismissal; the law merely requires the non-curability of the disease within a period of six months even with proper medical treatment.
The respondents also maintain that Deoferio’s claim for salary differential is already barred by prescription under Article 291 of the Labor Code.30 Even assuming that the claim for salary differential has been timely filed, the respondents assert that the parties expressly agreed in the International Assignment Relocation Agreement that “the assignment length is only an estimate and not a guarantee of employment for any particular length of time.”31 Moreover, his assignment in the United States was merely temporary and did not change his salary base, an amount which he already received.
Whether the respondents are solidarily liable to Deoferio for nominal damages.
Whether Deoferio is entitled to salary differential, backwages, separation pay, moral and exemplary damages, as well as attorney’s fees.
We find the petition partly meritorious.
Concomitant to the employer’s right to freely select and engage an employee is the employer’s right to discharge the employee for just and/or authorized causes. To validly effect terminations of employment, the discharge must be for a valid cause in the manner required by law. The purpose of these two-pronged qualifications is to protect the working class from the employer’s arbitrary and unreasonable exercise of its right to dismiss. Thus, in termination cases, the law places the burden of proof upon the employer to show by substantial evidence that the termination was for a lawful cause and in the manner required by law.
An employer has been found to be suffering from any disease.
His continued employment is prohibited by law or prejudicial to his health, as well as to the health of his co-employees.
A competent public health authority certifies that the disease is of such nature or at such a stage that it cannot be cured within a period of six months even with proper medical treatment.
Consistent with this construction, we applied this provision in resolving illegal dismissal cases due to non-contagious diseases such as stroke, heart attack, osteoarthritis, and eye cataract, among others. In Baby Bus, Inc. v. Minister of Labor,34 we upheld the labor arbitration’s finding that Jacinto Mangalino’s continued employment – after he suffered several strokes – would be prejudicial to his health. In Duterte v. Kingswood Trading Co., Inc.,35 we recognized the applicability of Article 284 of the Labor Code to heart attacks. In that case, we held that the employer-company’s failure to present a certification from a public health authority rendered Roque Duterte’s termination due to a heart attack illegal. We also applied this provision in Sy v. Court of Appeals36 to determine whether Jaime Sahot was illegally dismissed due to various ailments such as presleyopia, hypertensive retinopathy, osteoarthritis, and heart enlargement, among others. In Manly Express, Inc. v. Payong, Jr.,37 we ruled that the employer-company’s non-presentment of a certification from a public health authority with respect to Romualdo Payong Jr.’s eye cataract was fatal to its defense.
The third element substantiates the contention that the employee has indeed been suffering from a disease that: (1) is prejudicial to his health as well as to the health of his co-employees; and (2) cannot be cured within a period of six months even with proper medical treatment. Without the medical certificate, there can be no authorized cause for the employee’s dismissal. The absence of this element thus renders the dismissal void and illegal.
Simply stated, this requirement is not merely a procedural requirement, but a substantive one. The certification from a competent public health authority is precisely the substantial evidence required by law to prove the existence of the disease itself, its non-curability within a period of six months even with proper medical treatment, and the prejudice that it would cause to the health of the sick employee and to those of his co-employees.
In the current case, we agree with the CA that Dr. Lee’s psychiatric report substantially proves that Deoferio was suffering from schizophrenia, that his disease was not curable within a period of six months even with proper medical treatment, and that his continued employment would be prejudicial to his mental health. This conclusion is further substantiated by the unusual and bizarre acts that Deoferio committed while at Intel’s employ.
In Sy v. Court of Appeals39 and Manly Express, Inc. v. Payong, Jr.,40 promulgated in 2003 and 2005, respectively, the Court finally pronounced the rule that the employer must furnish the employee two written notices in terminations due to disease, namely: (1) the notice to apprise the employee of the ground for which his dismissal is sought; and (2) the notice informing the employee of his dismissal, to be issued after the employee has been given reasonable opportunity to answer and to be heard on his defense. These rulings reinforce the State policy of protecting the workers from being terminated without cause and without affording them the opportunity to explain their side of the controversy.
From these perspectives, the CA erred in not finding that the NLRC gravely abused its discretion when it ruled that the twin-notice requirement does not apply to Article 284 of the Labor Code. This conclusion is totally devoid of any legal basis; its ruling is wholly unsupported by law and jurisprudence. In other words, the NLRC’s unprecedented, whimsical and arbitrary ruling, which the CA erroneously affirmed, amounted to a jurisdictional error.
Intel’s violation of Deoferio’s right to statutory procedural due process warrants the payment of indemnity in the form of nominal damages. In Jaka Food Processing Corp. v. Pacot,41 we distinguished between terminations based on Article 282 of the Labor Code42 and dismissals under Article 283 of the Labor Code.43 We then pegged the nominal damages at P30,000.00 if the dismissal is based on a just cause but the employer failed to comply with the twin-notice requirement. On the other hand, we fixed the nominal damages at P50,000.00 if the dismissal is due to an authorized cause under Article 283 of the Labor Code but the employer failed to comply with the notice requirement. The reason is that dismissals for just cause imply that the employee has committed a violation against the employer, while terminations under Article 283 of the Labor Code are initiated by the employer in the exercise of his management prerogative.
With respect to Article 284 of the Labor Code, terminations due to disease do not entail any wrongdoing on the part of the employee. It also does not purely involve the employer’s willful and voluntary exercise of management prerogative – a function associated with the employer's inherent right to control and effectively manage its enterprise.44 Rather, terminations due to disease are occasioned by matters generally beyond the worker and the employer's control.
In fixing the amount of nominal damages whose determination is addressed to our sound discretion, the Court should take into account several factors surrounding the case, such as: (1) the employer’s financial, medical, and/or moral assistance to the sick employee; (2) the flexibility and leeway that the employer allowed the sick employee in performing his duties while attending to his medical needs; (3) the employer’s grant of other termination benefits in favor of the employee; and (4) whether there was a bona fide attempt on the part of the employer to comply with the twin-notice requirement as opposed to giving no notice at all.
We award Deoferio the sum of P30,000.00 as nominal damages for violation of his statutory right to procedural due process. In so ruling, we take into account Intel’s faithful compliance with Article 284 of the Labor Code and Section 8, Rule 1, Book 6 of the IRR. We also note that Deoferio’s separation pay equivalent to one-half month salary for every year of service45 was validly offset by his matured car loan. Under Article 1278 of the Civil Code, in relation to Article 1706 of the Civil Code46 and Article 113(c) of the Labor Code,47 compensation shall take place when two persons are creditors and debtors of each other in their own right. We likewise consider the fact that Intel exhibited real concern to Deoferio when it financed his medical expenses for more than four years. Furthermore, prior to his termination, Intel liberally allowed Deoferio to take lengthy leave of absences to allow him to attend to his medical needs.
Deoferio’s claim for salary differential is already barred by prescription. Under Article 291 of the Labor Code, all money claims arising from employer-employee relations shall be filed within three years from the time the cause of action accrued. In the current case, more than four years have elapsed from the pre-termination of his assignment to the United States until the filing of his complaint against the respondents. We thus see no point in further discussing this matter. His claim for backwages, separation pay, moral and exemplary damages, as well as attorney’s fees must also necessarily fail as a consequence of our finding that his dismissal was for an authorized cause and that the respondents acted in good faith when they terminated his services.
WHEREFORE, premises considered, we partially grant the petition; the assailed February 24, 2012 decision and the August 2, 2012 resolution of the Court of Appeals stand but respondent Intel Technology Philippines, Inc. is ordered to pay petitioner Marlo A. Deoferio nominal damages in the amount of P30,000.00. We totally deny the petition with respect to respondent Mike Wentling.
Del Castillo, Perez, Mendoza,** and Perlas-Bernabe, JJ., concur.
* In lieu of Associate Justice Antonio T. Carpio per Special Order No. 1699 dated June 13, 2014.
** Designated as Acting Member in lieu of Associate Justice Antonio T. Carpio per Special Order No. 1696 dated June 13, 2014.
1 Dated September 19, 2012 and filed under Rule 45 of the Rules of Court; rollo, pp. 8-27.
2 Id. at 29-38; penned by Associate Justice Agnes Reyes-Carpio, and concurred in by Associate Justices Jose C. Reyes, Jr. and Priscilla J. Baltazar-Padilla.
17 Article 284 of the Labor Code is now renumbered as Article 298 of the Labor Code.
18 LABOR CODE IRR, Book 6, Rule 1, Section 8.
30 Article 291 of the Labor Code is now renumbered as Article 305 of the Labor Code.
32Agabon v. NLRC, 485 Phil. 248, 284 (2004).
34 241 Phil. 1017 (1988).
35 561 Phil. 11 (2007).
36 446 Phil. 404 (2003).
37 510 Phil. 818 (2005).
38 Section 2. Security of tenure. (a) In cases of regular employment, the employer shall not terminate the services of an employee except for just or authorized causes as provided by law, and subject to the requirements of due process.
(b) The foregoing shall also apply in cases of probationary employment; provided, however, that in such cases, termination of employment due to failure of the employee to qualify in accordance with the standards of the employer made known to the former at the time of engagement may also be a ground for termination of employment.
(c) In cases of employment covered by contracting or subcontracting arrangement, no employee shall be dismissed prior to the expiration of the contract between the principal and contract or subcontractor as defined in Rule VIII-A, Book III of these Rules, unless the dismissal is for just or authorized cause, or is brought about by the completion of the phase of the contract for which the employee was engaged, but in any case, subject to the requirements of due process or prior notice.
(ii) A hearing or conference during which the employee concerned, with the assistance of counsel if he so desires, is given opportunity to respond to the charge, present his evidence, or rebut the evidence presented against him.
For termination of employment as defined in Article 283 of the Labor Code, the requirement of due process shall be deemed complied with upon service of a written notice to the employee and the appropriate Regional Office of the Department of Labor and Employment at least thirty days before effectivity of the termination, specifying the ground or grounds for termination.
39Supra note 36, at 419.
40Supra note 37, at 825.
41 494 Phil. 114 (2005).
42 Article 282 of the Labor Code is now re-numbered as Article 296 of the Labor Code.
43 Article 283 of the Labor Code is now re-numbered as Article 297 of the Labor Code.
44Abbott Laboratories (Phils.), Inc. v. NLRC, 238 Phil. 699 , 703 (1987).
48Culili v. Eastern Telecommunications Philippines, Inc., G.R. No. 165381, February 9, 2011, 642 SCRA 338, 365; and Businessday Information Systems and Services, Inc. v. NLRC, G.R. No. 103575, April 5, 1993, 221 SCRA 9, 14.

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