Source: http://lawlibrary.chanrobles.com/index.php?option=com_content&amp;view=article&amp;id=45908:156963&amp;catid=1459&amp;Itemid=566
Timestamp: 2019-04-21 12:57:32+00:00

Document:
THE PHILIPPINE AMERICAN LIFE AND GENERAL INSURANCE CO., Petitioner, v. ANGELITA S. GRAMAJE, Respondent.
This is a Petition for Review on Certiorari which seeks the review and reversal of the Decision1 of the Court of Appeals promulgated on 18 October 2002, reversing and setting aside the decision of the National Labor Relations Commission (NLRC), and the Resolution2 of the same appellate court dated 20 January 2003, denying the Motion for Reconsideration, for lack of merit.
Once again, the Court is being called upon to rule on a question that continuously besets labor-management relations - - - what is and what is not to be considered a legitimate exercise of management prerogative.
Private respondent Philippine American Life and General Insurance Company is a corporation duly organized and existing under Philippine laws. Individual respondents occupy the following positions, namely: Maurice Greenberg, as president of the Company; Jose Cuisia, Jr. as Chairman of the Board; Maria Haas and Gardon Watson as Regional Coordinating Pensions Officers, Reynaldo C. Centeno as Executive Vice-President, Chief Financial Officer and Chief Actuary; and Anthony Sotelo as the Senior Vice-President and Head of the Human Resources Department.
Petitioner was employed on October 28, 1997 by private respondent as Assistant Vice President and Head of the Pensions Department and in concurrent capacity as Trust Officer of Philam Savings Bank, a Philam Life subsidiary. She was to be paid P750,000.00 per annum and is entitled to the benefits given by private respondent to its employees.
Working as Assistant Vice President of Pensions Department of Philamlife, petitioner was offered an additional position by respondent Cuisia, which was then resolved and approved by Philam Savings Bank's Board of Directors, for the position of Head of Trust Banking Division or AVP-Trust Officer on a concurrent capacity and under a separate compensation.
Effective January 1998, however, petitioner's marketing manager and marketing officer were immediately transferred to Group Insurance Division. Petitioner, thereafter, was never given replacements for the marketing manager and marketing officer, contrary to private respondent Cuisia's assurance. Thus, petitioner ran the Pensions Department single-handedly with only one administrative assistant as her staff. Petitioner did the field work, the desk work (administrative, legal, finance, marketing), the out of town meetings, the client presentations, aside from her work with the Philam Savings Bank as fund manager, wherein private respondent Cuisia offered to her for a separate compensation, but has still remain [sic] unpaid.
Sometime in November, 1998, petitioner availed of her housing and car benefits and applied for a car loan and housing loan.
On November 18, 1998, however, private respondent through Centeno and Sotelo, offered her P250,000.00 for her to vacate her position by December 1998. Petitioner declined the offer considering that there was no valid reason for her to leave. Private respondents Centeno and Sotelo admonished her that her filing of suit would prompt respondent Cuisia to blacklist her in companies where he holds directorships and advised her that Philamlife is big and can stand the long ordeal of justice system, whereas she may not withstand the phase of the trial. Evidence that this meeting and matter took place was the formal letter of rejection dated November 25, 1998 sent by petitioner and duly received by the offices of respondents Cuisia, Centeno and Sotelo.
[T]his shall summarize the discussion of meeting held at Mr. Centeno's Office last November 18, 1998.
On December 6, 1998, respondent Cuisia met with petitioner and cajoled her to reconsider and accept the offer of settlement. Cuisia even volunteered to help her look for another job. Petitioner declined, and reiterated that the actuations of respondents clearly intended to harass and humiliate her and have caused her and her family extreme emotional stress.
On December 8, 1998, two days after the aforesaid December 6 meeting, respondents issued her a memorandum instructing her to transfer to the Legal Department effective December 14, 1998 and to make proper turnover and submit the status report not later than December 11, 1998.
Undersigned wish to inform you that your directive for the transfer of undersigned to the legal department is being contested on the ground of outright violation of undersigned's rights.
Undersigned believe that the transfer will not make her efficient in her work. Undersigned was hired primarily because of her marketing, finance, and fund management skills. Her legal skills are secondary and supplementary in nature. Thus, transfer to the legal department, which is primarily legal, is not acceptable for it will only make undersigned less efficient and negates her productivity and contribution to the company.
Let it be on record, that as of today, the Department has surpassed its P15 Million target, which was originally at P12 Million, as set by no less than the president of Philamlife during the budget preparation and as duly reviewed and approved by the head of the corporation planning department, as fully documented. For the records, we are almost hitting the P20 Million fund level volume, and we are just waiting for the confirmed P109 Million placement of Adamson University Retirement Fund.
With the above, by December 14, 1998 undersigned will continue to be the head of the Pensions Department until this new issue and the other issues raised are fully resolved.
This refers to your 9 December 1998 memorandum regarding your request for a car loan. I have earlier discussed your application for a car loan with both Mr. Anthony B. Sotelo, FVP and Corporate HR Director and Mr. Jose L. Cuisia, Jr., President and CEO. Considering your present employment status, which has been the subject of several discussions between you and Messrs. Jose L. Cuisia, Jr. and Anthony B. Sotelo and myself, we deem it prudent to defer action on your loan request until such time that the issue is resolved with definitiveness.
On December 16, 1998, petitioner, while on Official Sick Leave, received a message in her pager that the Pensions Department, which was then holding office at the fifth floor of the Philamlife Building at United Nations Avenue was assumed to be headed by Corine Moralda as her successor, and the Pensions Department was to be immediately physically transferred on said date at the Philamlife Gammon Center in Makati City. Though sick and on official sick leave, petitioner went to the office on December 17, 1998 to verify, and upon seeing the Pensions Department totally dark, without any staff and with left over fixtures, petitioner, emotionally shattered, opted to just leave the premises.
On December 18, 1998, respondent Cuisia through a memorandum appointed Ms. Corine Moralda as replacement of petitioner as Head of the Pensions Department effective December 14, 1998. It was only at that time that petitioner learned that as early as August 23, 1998, respondents had advertised in the Manila Bulletin for her replacement.
Also, although, it is the tradition of Philamlife to give, during the Christmas Season, officers and employees a traditional Season's giveaways, i.e., ham and queso de bola, petitioner then, thru her authorized representatives, asked for her share, but she was not in the list of recipients. Petitioner's name was not in the Legal Department, not in the Pensions Department, and not in the list of employees of Philamlife when verified with the Personnel Department.
Hence, on December 23, 1998, petitioner filed the instant case for illegal or constructive dismissal against herein private respondents.
After a careful evaluation of the records, this Office finds and so holds that complainant's "alleged" illegal dismissal seemed never to have taken place at all, constructive or otherwise. Complainant's insistence in holding onto her former position for which, as earlier assessed by the Company, she did not meet the high standards expected of her, does not deserve support.
Complainant's supposed transfer to the Legal Department cannot be considered to be unbearable, nor inconvenient, nor prejudicial to the employee, as it did not even involve a demotion in rank or diminution of [her] salaries, benefits and other privileges. Complainant held the position of AVP-Pensions. Her supposed transfer to the Legal Department, still with the rank of AVP, and most importantly, with the same salaries and benefits, cannot, by any stretch of imagination, be considered as amounting to a constructive dismissal.
The NLRC, in its Decision dated 27 November 2000, affirmed in toto the Decision of the Labor Arbiter.
WHEREFORE, in view of all the foregoing, the assailed decision of public respondent NLRC is hereby REVERSED and SET ASIDE. Accordingly, private respondent is hereby ORDERED to pay petitioner separation pay in lieu of reinstatement, her full backwages inclusive of allowances and other benefits or their monetary equivalent. For this purpose, the case is remanded to the Labor Arbiter for further proceedings solely for the purpose of determining and/or computing the monetary liabilities of private respondents.
Additionally, considering that private respondents were proven to be in bad faith in the constructive dismissal of petitioner, the former are hereby ordered to pay the latter exemplary damages in the amount of Fifty Thousand Pesos (P50,000) and moral damages also in the amount of Fifty Thousand Pesos (P50,000).
As borne by the records, it appears that there is a divergence between the findings of facts of the Labor Arbiter as affirmed by the NLRC, and that of the Court of Appeals. Therefore, for the purpose of clarity and intelligibility, this Court will make an infinitesimal scrutiny of the findings of facts of the Labor Arbiter and the NLRC.
In the case at bar, bad faith and discrimination on the part of petitioner are profusely perceived from its actions.
First, as early as 23 August 1998, unbeknown to respondent, petitioner had already advertised in the Manila Bulletin for the former's replacement.16 Respondent was not even notified in advance of an impending transfer.
Second, the President and CEO of petitioner corporation, Jose L. Cuisia, Jr., in his Memorandum17 dated 18 December 1998, announced the appointment of respondent's replacement effective 14 December 1998, or during the time that respondent was still on official sick leave. It is worthy to note that on 10 December 1998, respondent, through a letter18 of even date, protested her sudden unexplained transfer, more so, to a non-existing position. Respondent, in said letter, likewise pointed out that her department surpassed the target fund level volume set by the company (which negates petitioner's allegation of ineptness on the part of respondent, used as ground by the former to justify the transfer), and thereby requested for status quo, until all issues were resolved. No response was made.
Third, the transfer of respondent to the Legal Department was unreasonable, inconvenient and prejudicial to her. Petitioner must have known that respondent has no adequate exposure in the field of litigation, and yet she was transferred to the Legal Department, and as AVP at that. The position of AVP-Legal would have placed respondent in a very inopportune position because she would be heading a team of lawyers who are far more experienced than she was in the area of litigation. It was a poor business decision and it is unlikely that the officers of petitioner would have made such a decision, except to inconvenience or prejudice respondent. Under the circumstances, the decision to transfer was unreasonable.
Fifth, as clearly pointed out by respondent, she formally rejected the offer of P250,000 for her to leave the company. The refutation was done in writing and duly received by the three highest offices of petitioner, namely: the Office of the President; the Office of the Executive Vice-President; and the Office of the Senior Vice-President and Head of Human Resources.22 Incongruously, taking into consideration the said contents of the formal letter of rejection, there was no response whatsoever from the aforesaid offices. It may be true, as stated by petitioner, that "the alleged memorandum pertaining to the meeting held on 18 November 1998 on the alleged P250,000 settlement offer was prepared by respondent alone without any participation from the company,"23 but the fact remains that no formal response was ever made by any of the three offices which received the same. The contents thereof, if untrue, would have elicited a stark and strong reaction from any of the three offices.
Quite conspicuously, the Labor Arbiter, in his decision, did not thoroughly pass upon the matter involving an offer of P250,000 to respondent for the latter to vacate her position as AVP-Pensions. Contemplation or consideration of this important detail would have been enough for the Labor Arbiter to see that there was palpable bad faith on the part of petitioner when respondent was ordered to transfer from the Pensions Department to the Legal Department.
But, like other rights, there are limits thereto. The managerial prerogative to transfer personnel must be exercised without grave abuse of discretion, bearing in mind the basic elements of justice and fair play. Having the right should not be confused with the manner in which that right is exercised. Thus, it cannot be used as a subterfuge by the employer to rid himself of an undesirable worker. In particular, the employer must be able to show that the transfer is not unreasonable, inconvenient or prejudicial to the employee; nor does it involve a demotion in rank or a diminution of his salaries, privileges and other benefits. Should the employer fail to overcome this burden of proof, the employee's transfer shall be tantamount to constructive dismissal, which has been defined as a quitting because continued employment is rendered impossible, unreasonable or unlikely; as an offer involving a demotion in rank and diminution in pay. 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.
The NLRC, in its decision27 dated 27 November 2000, found that respondent herein was hired by petitioner to head the Strategic Business Unit (SBU), and that she was specifically engaged as such because of her representation that she was knowledgeable and experienced in the trust business.28 The records reveal otherwise. Herein respondent was not hired to handle the so-called SBU. She was hired as Assistant Vice-President in charge of Pensions Department.29 This fact is further inveterated by the announcement of Cuisia in his Memorandum dated 08 December 1997,30 that, indeed, respondent herein was appointed as such.
In petitioner's Memorandum dated 29 December 2003, it was alleged that due to a change in the business strategy, the Pensions Department had to dispense with the position of respondent who was specifically hired to perform trust work.31 This cannot be precise. As discussed above, respondent's replacement was appointed effective 14 December 1998. If the position of AVP-Pensions Department was dispensed with, then why was a replacement hired by petitioner to assume such post on said date? Non sequitur. It does not follow.
In fine, this Court rules that there was constructive dismissal, and therefore, the petition must fail.
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.32 The circumstances which prevailed in the working environment of the respondent clearly demonstrate this. The failure of the Labor Arbiter to resolutely consider these prevailing circumstances before respondent was asked to transfer was a major flaw in his decision. Clearly, had the Labor Arbiter considered them, he would have concluded that the transfer of respondent from the Pensions Department to the Legal Department was not a legitimate exercise of management prerogative on the part of petitioner. Before the order to transfer was made, discrimination, bad faith, and disdain towards respondent were already displayed by petitioner.
It is rather peculiar that the alleged ineptness of respondent did not prompt petitioner to issue any Inter-office Memorandum reprimanding, admonishing, or warning the former about her performance. The solemnity of respondent's alleged non-performance was so immense, considering that the Pensions Department is a profit center, which was so imperative to the existence of petitioner in terms of raising revenue. The officers of petitioner should have been very much troubled about this.
. . . Social justice is "neither communism, nor despotism, nor atomism, nor anarchy," but the humanization of laws and the equalization of social and economic forces by the State so that justice in its rational and objectively secular conception may at least be approximated. Social justice means the promotion of the welfare of all the people, the adoption by the Government of measures calculated to insure economic stability of all the competent elements of society, through the maintenance of a proper economic and social equilibrium in the interrelations of the members of the community, constitutionally, through the adoption of measures legally justifiable, or extra-constitutionally, through the exercise of powers underlying the existence of all governments on the time-honored principle of salus populi est suprema lex.
Social justice, therefore, must be founded on the recognition of the necessity of interdependence among divers and diverse units of a society and of the protection that should be equally and evenly extended to all groups as a combined force in our social and economic life, consistent with the fundamental and paramount objective of the state of promoting the health, comfort, and quiet of all persons, and of bringing about the greatest good to the greatest number.
WHEREFORE, in view of all the foregoing, the Petition is hereby DENIED, and the assailed Decision dated 18 October 2002 and Resolution dated 20 January 2003 of the Court of Appeals, are hereby AFFIRMED. Costs against petitioner.
1 Rollo, pp. 35-44, penned by Associate Justice Eloy R. Bello, Jr. with Associate Justices Candido V. Rivera and Juan Q. Enriquez, Jr., concurring.
7 Insular Life Assurance Co. v. Court of Appeals, G.R. No. 126850, 28 April 2004, citing PestaÃ±o v. Sumayang, G.R. No. 139875, 04 December 2000, 346 SCRA 870; BaÃ±as, Jr. v. Court of Appeals, G.R. No. 102967, 10 February 2000, 325 SCRA 259; Borromeo v. Sun, G.R. No. 75908, 22 October 1999, 317 SCRA 176; Lagrosa v. Court of Appeals, G.R. NOS. 115981-82, 12 August 1999, 312 SCRA 298; Security Bank and Trust Co. v. Triumph Lumber and Construction Corp., G.R. No. 126696, 21 January 1999, 301 SCRA 537.
8 Abalos v. Philex Mining Corporation, G.R. No. 140374, 27 November 2002, 393 SCRA 134.
11 Mendoza v. Rural Bank of Lucban, G.R. No. 155421, 07 July 2004, citing Lanzaderas v. Amethyst Security and General Services, Inc., G.R. No. 143604, 20 June 2003, 404 SCRA 505; Jarcia Machine Shop and Auto Supply, Inc. v. NLRC, G.R. No. 118045, 02 January 1997, 266 SCRA 97; Escobin v. NLRC, G.R. No. 118159, 15 April 1998, 289 SCRA 49.
12 North Davao Mining Corporation v. NLRC, G.R. No. 112546, 13 March 1996, 253 SCRA 721.
13 Black's Law Dictionary, 8th Edition, p. 500.
14 Romuladez-Yap v. Civil Service Commission, G. R. No. 104226, 12 August 1993, 225 SCRA 285.
15 Laureano Investment and Development Corporation v. Court of Appeals, G. R. No. 100468, 06 May 1997, 272 SCRA 253.
23 Petitioner's Memorandum, p. 16.
24 Mendoza v. Rural Bank of Lucban, G.R. No. 155421, 07 July 2004; Tierra International Const. Corp. v. NLRC, G.R. No. 101825, 02 April 1996, 256 SCRA 36; Magnolia Dairy Products Corp. v. NLRC, G.R. No. 114952, 29 January 1996, 252 SCRA 483; Reahs Corp. v. NLRC, G.R. No. 117473, 15 April 1997, 271 SCRA 247; Palomares v. NLRC, G.R. No. 120064, 15 August 1997, 277 SCRA 439; Arrieta v. NLRC, G.R. No. 126230, 18 September 1997, 279 SCRA 326.
25 Mendoza v. Rural Bank of Lucban, supra.
26 G.R. No. 129843, 14 September 1999, 314 SCRA 401, 408-409.
32 Blue Dairy Corporation v. NLRC, supra.
33 Petitioner's Memorandum, pp. 6-7.
35 Petitioner's Memorandum, pp. 19-20.
38 Philippine Advertising Counselors, Inc. v. NLRC, G.R. No. 120008, 18 October 1996, 263 SCRA 395.
40 Philippine Geothermal, Inc. v. NLRC, G.R. No. 82643-67, 30 August 1990, 189 SCRA 211.
41 G.R. No. 47800, 02 December 1940, 70 Phil. 726, 734-735.

References: v. 
In fine
 V. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v.