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2) Academic freedom
SECURITY OF TENURE
An elementary or high school has security of tenure.
Security of Tenure only came about after the effectivity of
the Labor Code. An elementary or high school cannot invoke double
security of tenure.
Security of tenure is a statutory right and NOT a
constitutional right. An elementary or high school cannot invoke academic
freedom.
Security of tenure can either be limited or qualified or full.
Academic freedom’s essence is tenure. Without tenure, the
A right to continue employment, where there has been no academic right becomes non-existent.
definite period agreed upon.
It is where the faculty (in a tertiary level) member would
Security of tenure is not absolute. It is subject to just or not fear retribution that he is teaching something that has
authorized causes that supervenes. not been established.

Security of tenure is an obligation on the part of the It is where the faculty member can pursue studies in his
employer. specialty and make known his work or publish it without
fear of retribution.
The employee has no obligation at all to remain for the
rest of his life with the employer. FULL SECURITY OF TENURE = RANK AND FILE
REGULAR EMPLOYEES
EMPLOYMENT AT WILL or TERMNABLE AT WILL; the
OPPOSITE OF SECURITY OF TENURE
A regular rank-and-file enjoys the highest security of
Employment at will is not practiced here in the Philippines tenure.
and not provided under the Labor Code because it is only a
common law rule. 1) Art. 294 Usual and Necessary Rule

Employment at will is not provided under any law. Those who perform activities that are usual and necessary
to the usual trade and business of the employee.
It is where an employment contract of indefinite duration
can be terminated by either the employer or the employee A written or oral agreement between an ER and EE cannot
at any time for any reason. stipulate with each other that the other can never be a
regular employee.
But also take note that in an ER-EE relationship, it is only
the employee has the right to get out of the relationship EXCEPTION: Those who perform activities that are
regardless of whether the reason. Otherwise, it would usual and necessary but are not regular employees.
amount to an involuntary servitude.
PRINCIPLE:
DOUBLE SECURITY OF TENURE 1. They enjoy security of tenure but only for a
LIMITED PERIOD (probationary employee,
Montemayor vs. Araneta (penned by Justice Enrique project employee, seasonal employee, they
Fernando) enjoy security of tenure but limited or by
- The employee who enjoys DOUBLE security of degrees).
tenure is a professor in a tertiary level educational
institution.
1) Security of tenure under the Labor Code

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Even if the house has not been fully built or there are still
activities needed to be finished, the painter’s activity has
already ended.

1. Managerial employees Project employee’s term are expired and without any
separation pay.
CAVEAT:
Not all regular employees enjoy security of tenure. Such as EFFECTS WHEN THE PROJECT EMPLOYEE HAS
managerial employees. BEEN HIRED FOR MORE THAN A YEAR

Managerial employees are regular employees. The painter becomes a regular employee for as long as the
Managerial employees have no security of tenure. activity is still there.
Managerial employees’ employment is based on
confidentiality and trust. Once he is a regular employee, he can only be terminated
They are one of the employees who are the only one who or dismissed to remove him. There will no longer be any
can be dismissed on the ground of loss or trust confidence. expiration.

MGG Marine Services vs. NLRC; Artemio Panganiban Removal of a project employee who has become a regular
A chief finance officer whose confidence was given by employee will amount to illegal dismissal and payment of
the owners of the company and was let go by reason of backwages.
the fact that she did acts in contravention of the higher
authorities, was dismissed for cause (fault of the Fegurin vs. NLRC
employee) without any benefits. The four of the petitioners 3 had been working with the
Company for nine years, one 4 for 8 years, another 5 for
2. Project employees 6 years, the shortest term being 3 years. The
Construction Company has not rebutted petitioners'
Employment has been: averments that they had been employed for several years
a. fixed for a specific project or undertaking the before their services were terminated. Now the
completion or termination of which employees allege that they have become regular
b. has been determine at the time of the engagement employees and they were illegally dismissed for union
of the employee or where the work or service to be activities on September 28, 1977 and prayed for
performed reinstatement with backwages.

Project employee’s engagement is only: Project employees are those employed in connection
a. Up to the end of the project; or with a particular construction project.
b. Up to the end your activity in the project
Non-project employees are those employed by a
(as the case may be) construction company without any particular project.

For example: The nature of the work of petitioners, that of carpenter,

You have been hired as a painter for the interior of the walls laborer or mason, their respective jobs would actually be
of the building. The entire project includes the building of continuous and on-going. When a project to which they
the house, garden, etc. are individually assigned is completed, they would be
assigned to the next project or a phase thereof. In other
When the painting of the walls (activity) has already been words, they belonged to a "work pool" from which the
finished, your engagement has expired. Company would draw workers for assignment to other
projects at its discretion. They are, therefore, actually
"non-project employees" and are considered as a work
pool employee.

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Manila Hotel vs. CIR

The Company had reported petitioners for registration The chamber maid was recruited for two seasons.
and membership with the Social Security System, and
is an implicit admission by it of the actual dates of Each season for 6 months. 1 season of 6 months x 2 = 1
employment of petitioners as above-enumerated, and year.
not as stated in the individual Notices of Employment
allegedly commencing in 1975, 1976 and 1977, or just She was deemed as a regular employee.
some months prior to their dismissal in 1977.
SUPPOSE: Applying the Manila Hotel vs. CIR, suppose:
The Solicitor General is also of the view that petitioners
are regular and permanent employees and has An interior decorator is hired for the 2 seasons (for the
recommended that they be reinstated with backwages. summer season and Christmas season).

Q: He was hired from March to June (3 months) for the

PNCC vs. NLRC summer season and September to January (4 months) for the
Emelito whose employment was an oiler was terminated Christmas season. Is he deemed a regular employee?
on the ground that there was a completion of the project
to which he was assigned. NO. He was not hired to an accumulated period equivalent
of one year. The one year period here does not need to be
A project employee is one whose "employment has been continuous or unbroken it needs to be accumulated.
fixed for a specific project or undertaking the
completion or termination of which has been determined Q: Does the designer have to be employed for an equivalent
at the time of the engagement of the employee or where of one year within one year?
the work or services to be performed is seasonal in nature
and the employment is for the duration of the season." NO. It can be broken.
(Sec. 280, Labor Code; Sandoval Shipping Inc. vs. NLRC,
136 SCRA 674.) EFFECTS WHEN THE SEASONAL OR PROJECT
EMPLOYEES HAVE BECOME REGULAR EMPLOYEES
In finding that Porciuncula was a regular employee, the
Labor Arbiter noted that it was the petitioner's practice to The period during which they are were not employed are
rehire him after the completion of every project and this deemed to be considered only as on leave of absence
re-hiring continued throughout Porciuncula's 13 years of without pay until they are re-employed. Corollary, during
employment in the company. the time that there is no project, there can be no demand
for compensation by the regular seasonal or project
The Labor Arbiter also observed that the petitioner never employees since they are on LOA without pay.
reported the completion of its projects and the
termination of the employees (like Porciuncula) in its 4. Term employment or Bona Fide Term
finished projects, to the nearest Public Employment Employment
Office as required by Policy Instruction No. 20 of the
Secretary of Labor. In the case of Ochoco vs. NLRC, 120 Brent School vs. Zamora
SCRA 774, the failure of the employer to report to the In educational institutions, like the dean, principal,
nearest employment office the termination of the workers academic head, etc.
everytime it completed a project was considered by this
Court as proof that they were not project employee and They are not forever positions. It is always with a term,
hence, regular employees. where after a certain term if he runs out of effectivity he,
can replaced.

3. Seasonal employees
5. Re-hired after retirement

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An employee who is allowed to work after a probationary

UST vs. NLRC period shall be considered a regular employee.
Section 1.Retirement age — It is hereby agreed and
stipulated that the compulsory retirement age for faculty Requisites:
members is 65 years, provided that faculty members who (1) from the start you are told the duration of your probation
have reached the age of 65 years may be granted and
extension of tenure unless they are physically (2) the standards by which you should aim to comply with
incapacitated or are manifestly inefficient or so that you are made regular
incompetent, or are otherwise removed for cause. They
shall continue to enjoy the usual benefits and privileges Otherwise, if you have been rendering what is usual and
until the extension of their tenure is validly denied by necessary without have been informed of your
the UNIVERSITY in consultation with the UNION or probationary status, you are a REGULAR EMPLOYEE.
until they are validly separated from the service,
provided that their period of extended service shall not PRINCIPLES:
be credited for purposes of retirement. 1. The 6 month period can actually be cut short by
an employer most especially if he has already
Bonifacio upon reaching the age of 65 has been denied attained the qualifications for regularization.
extension of tenure when he reached the age of 65. 2. The 6 month period IS NOT mandatory but
merely directory.
They filed an unfair labor practice before the NLRC. 3. A probationary employee who is retrenched is
entitled to separation benefits.
It is important to state that upon the compulsory
retirement of an employee or official in the public or Who are those who does not have a probationary period:
private service his employment is deemed terminated. PIRATED EMPLOYEES or those coming from a competitor
The matter of extension of service of such employee or company. At the first day of work, they are immediately
official is addressed to the sound discretion of the regular.
employer. It is a privilege only the employer can grant.
Abott Laboratories vs. Alcaraz
In the case of Prof. Francisco Bonifacio, the non- Pearlie Ann Alcaraz, applied and was under probation for
extension of his service was because he did not apply for 6 months. She was also notified of her duties and was
the same but also because at the time he retired there given a probationary performance standards and
was an administrative case against him for allegedly evaluation which she have to apply in her task of
immoral acts. Nevertheless, he executed an affidavit evaluation the staffs.
stating that he did not authorize the filing of the petition
in his behalf and that he is not interested in the A probationary employee, like a regular employee,
extension of his service. enjoys security of tenure (but not full, only absolute or
qualified).

6. Probationary Employee The services of an employee who has been engaged on

probationary basis may be terminated for any of the
Art. 281. Probationary employment. Probationary following:
employment shall not exceed six (6) months from the date
the employee started working, unless it is covered by an (a) a just or
apprenticeship agreement stipulating a longer period. The (b) an authorized cause; and
services of an employee who has been engaged on a (c) when he fails to qualify as a regular employee in
probationary basis may be terminated for a just cause or accordance with reasonable standards prescribed by the
when he fails to qualify as a regular employee in employer.
accordance with reasonable standards made known by the
employer to the employee at the time of his engagement.

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(b) Provided that: the employer shall make known If you are terminated, you may or may not have separation
to the employee the standards under which he will qualify pay depending on the grounds.
as a regular employee at the time of his engagement.
Where no standards are made known to the employee at JUST CAUSES (Art. 297)
that time, he shall be deemed a regular employee. 1. Serious Misconduct
2. Gross and habitual neglect of duties
Abott indicated the job description and Alcaraz was 3. Fraud and willful breach of trust
communicated of her duties as a probationary employee 4. Commission of crime or offense by the
and her failure to perform led her to inadequately perform employee against the person of his employer,
and would led to her non-regularization and her immediate member, his family or
termination. representatives
5. Other causes analogous
7. Legitimate job contracting
Prohibited Activities
Kimberly-Clark case: The Supreme Court has taken judicial 1. Union officers who knowingly participate in
notice of the practice of contracting these employees. an illegal strike
Example: A security guard (hired by a manpower service) in 2. Any employee, union officer or ordinary
a bank cannot be a regular employee of the bank. member who knowingly participates in the
commission of the illegal acts during a strike
(regardless of whether the strike is legal or not)

National Interest Cases

TERMINATION IN GENERAL Violations of DOLE orders.

Union Security Clause

TERMINATION AND DISMISSAL has two-fold due
Such as failure to join the union or to maintain his
process requirements:
membership in good standing therein.
1. Substantive aspect

a. Just causes
b. Authorized causes; and THUS:
1. An employee who participated in a legal strike is
2. Procedural aspect terminated.
2. An employee who committed illegal acts during a
a. Statutory due process and legal strike may be dismissed.
b. Contractual due process
JUST CAUSES UNDER JURISPRUDENCE:
DISMISSAL 1. Violation of Company Rules
- It must not be one that its description and
SUBSTANTIVE ASPECT phraseology are not found in Art. 297 nor in
any other provisions of the Labor Code.
Dismissal is where there is cessation of an employment due
to a cause attributable to the employee. Example: “If to obey traffic rules and
regulations as well as the company policies” is
Dismissal is a termination with just cause. so fundamental and so universal that any
employee is expected to satisfy the requirement
The employee has committed a wrongful act or omission. whether or not he has been so informed.

If you are dismissed, you do not have any separation pay. 2. Theft of property owned by a co-employee
3. Incompetence or ineptitude

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4. Failure to attain work quota 1. A Company rule and regulation or policies are
5. Failure to comply with weight standards of presumed valid until amended or nullified. Until
employer such as in cases of flight attendant and unless the rules or orders are declared to be
6. Attitude problem illegal or improper, the employees ignore or
disobey them at their own peril.
2. If there has been toleration or acquiesced by
SERIOUS MISCONDUCT superiors cannot be a valid ground to terminate
3. Laxity of leniency in the enforcement of the rules
Requisites: cannot be an excuse for the commission of
1. It must be serious wrongful acts
2. It must relate to the performance of the 4. When a memo has been released with a
employee’s duties requirement that he must answer in the memo,
3. It must be shown that he has become unfit to another notice is required in case of termination
continue working for the employer and on the ground of failure to answer a memo to
4. It must have been performed with wrongful explain (procedural).
intent 5. Refusal to undergo drug testing is both
misconduct and willful insubordination
IMPORTANT:
1. It might be a series of irregularities, when they are ABANDONMENT
already put together, may constitute serious
misconduct 1. The employee must have failed to report for work
2. Committing libel against an immediate superior or must have been absent without valid or
is serious misconduct. justifiable reason
3. Disrespectful conduct is NOT serious misconduct 2. There has been 4 months of abandonment
when provoked by the superior. 3. There must have been clear intention on the part
4. Organizing a credit union (paluwagan) by of the employee to sever the ER-EE
employees in a bank is serious misconduct.
5. The act of a teacher to change the failing grade of PRINCIPLES:
a student is serious misconduct. 1. Abandonment is a factual issue.
6. Using company property for personal business is 2. There must be three notices:
serious misconduct. a) That the employee must explain why he
should not be declared at to have abandoned
INSUBORDINATION OR WILFULL his job (show-cause)
DISOBEDIENCE OF THE LAWFUL ORDERS b) Restate
c) Employer’s decision to dismiss him on the
1. It must have been done willfuly ground of abandonment
2. There must have been a reasonable and lawful
company rule, regulation or policy and made 3. The immediate filing of the employee for illegal
known to the employee and must pertain to the dismissal and reinstatement negates abandonment
duties for which he has been engaged to discharge BUT if what is prayed for is separation pay and
not reinstatement, such does not negate
For there to be a valid company rules and regulations: abandonment.
1. It must be lawful and reasonable
2. Sufficiently known to the employee and; EFFECTS OF FAILURE TO COMPLY WITH THE
3. In connection with the duties for which the PROCEDURE FOR DISMISSAL FOR CAUSE
employee has been engaged to discharge Payment of FINE:
1. 30,000 pesos to the employee
SOME PRINCIPLES
FRAUD AND LOSS OF TRUST AND CONFIDENCE

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2. Every employee must enjoy some degree of trust

Art. 297 of the Labor Code and confidence from the employer as that is one
reason why he was employed in the first place BUT
Fraud is a willful breach by the employee of the trust for as long as his job is not entrusted, safekeeping
reposed by his employer or duly authorized representative. and safeguarding company policies, management
privy to these confidential matters.
PRINCIPLES: 3. Loss of trust must be established by factual
1. Fraud necessarily follows loss of trust and evidence.
confidence against the employer. 4. Long years of service, absence of derogatory record
2. Loss of trust and confidence does not necessarily are deemed inconsequential insofar as loss of trust
result in the latter’s loss of trust and confidence in and confidence.
the former. 5. Restitution will not absolve.
3. The fact that the employer did not suffer damage 6. Suffer of damage are not relevant.
damage because of its timely discovery does not
excuse the latter from any culpability COMMISSION OF CRIME OR OFFENSE
4. The returning or restitution does not have
absolutory effect. The following are the requisites for the valid invocation of
this ground:
1) A crime or offense was committed by the
employee;
2) It was committed against any of the following
persons:
a. His employer
Willful Breach of Trust and Confidence b. Any immediate member of his employer’s
family or
1. Employee holds a position of trust and confidence - Parents
(e.g. managerial employee) - Husband or wife
• Those who have in their care, custody, handling - Children
or care and protection of the employer’s money, - Other descendants and ascendancts
assets or property. - Brothers and sisters, full of half blood

IMPORTANT: c. His employer’s duly authorized representative

An ordinary rank and file employee cannot be dismissed
based on loss of trust and confidence. PRINCIPLES:
1. Work-relation is not necessary.
2. Betrayal of the employer’s trust must be real.
3. Breach must be willfully, knowingly and purposely Example: The commission of the crime of physical injuries
and without justifiable cause against the employer was by reason of personal issues
4. The act must be in relation to his work which between them and not regarding work is irrelevant,
would render him unfit automatic a valid ground for commission of crime or
offense.
PRINICIPLES:
1. The mere fact that a person was just a supervisor Other causes
was not charged with the custody of the company’s 1. Disease
money or property is inconsequential because he
belongs to the first class of employees occupying Villaruel vs. Yeo Han Guan
positions of trust and not to the fudiciary rank- On December 12, 1998, he reported for work but was no
and-file class. longer permitted to go back because of his illness; he
asked that respondent allow him to continue working but

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be assigned a lighter kind of work but his request was at least five (5) years in the said establishment, may retire
denied; instead, he was offered a sum of P15,000.00 as his and shall be entitled to retirement pay equivalent to at
separation pay; however, the said amount corresponds least one-half (1/2) month salary for every year of service,
only to the period between 1993 and 1999; petitioner a fraction of at least six (6) months being considered as
prayed that he be granted separation pay computed one whole year.
from his first day of employment in June 1963, but
respondent refused. Unless the parties provide for broader inclusions, the term
one half (1/2) month salary shall mean fifteen (15) days
Article 284 thereof, which reads as follows: plus one-twelfth (1/12) of the 13th month pay and the
cash equivalent of not more than five (5) days of service
An employer may terminate the services of an employee incentive leaves. (Emphasis and underscoring supplied)
who has been found to be suffering from any disease and
whose continued employment is prohibited by law or is Simply stated, in the absence of any applicable agreement,
prejudicial to his health as well as to the health of his co- an employee must (1) retire when he is at least sixty (60)
employees: Provided, That he is paid separation pay years of age and (2) serve at least (5) years in the company
equivalent to at least one (1) month salary or to one-half to entitle him/her to a retirement benefit of at least one-
(½) month salary for every year of service whichever is half (1/2) month salary for every year of service, with a
greater, a fraction of at least six months being considered fraction of at least six (6) months being considered as one
as one (1) whole year. whole year.

Here it was shown that the EE did not ask for Unfortunately, while Padillo was able to comply with the
reinstatement and was the only one who withdrew from five (5) year tenure requirement as he served for twenty-
work and never intended to return to his employment nine (29) years he, however, fell short with respect to the
because of his health, which despite being offered to sixty (60) year age requirement given that he was only
return, refused and was tantamount to resignation. fifty-five (55) years old when he retired. Therefore,
without prejudice to the proceeds due under the Philam
The Court applied compassionate justice here were the EE Life Plan, petitioners claim for retirement benefits under
here was already been employed for more than 35 years Art. 300 must be denied.
to the ER. Thus, the ER shall grant the financial assistance
needed. IMPORTANT:
1. If by reason of the pendency of the case the
2. Retirement employee has attained retirement age and
subsequently, there was proof of illegal dismissal,
Padillo vs. Rural Bank the employee can no longer demand for
EE was employed by Rural Bank. EE was later on reinstatement.
diagnosed with Hypertension S/P with short term
memory loss, the nature was total disability. On 3. Omnibus Code
September 10, 2007, he said that he wanted an early
retirement. PNOC-EDC vs. NLRC
Those appointed are deemed resigned upon filing the
Art. 297 (disease) does not apply because it was EE not certificate of candidacy.
the bank who severed the relationship with the bank. 297
is only applicable where the ER was the one who Regardless if with or without an original charter.
terminated the services of the employee who was found
to have terminated his employment. 4. Conflict of Interest or Acceptance of
Incompatible Office
An employee upon reaching the age of sixty (60) years or
more, but not beyond sixty-five (65) years which is hereby Manila Broadcasting vs. NLRC
declared the compulsory retirement age, who has served

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There was an unwritten company policy that any of his subordinates, but he actively facilitated the
employee who files a COC for any elective or local office commission of immoral conduct of his subordinates by
as resigned from the company. Nevertheless, there is no driving his car into the motel.
prohibition against a company to require them as a
matter of policy. He failed to live up to this higher standard of
responsibility when he succumbed to his moral perversity.
Remember that RA 6646 does not require mass media And when such moral perversity is perpetrated against
commentators to resign they are just required to go on his subordinate, he provides justifiable ground for his
leave. dismissal for lack of trust and confidence. It is the right,
nay, the duty of every employer to protect its employees
When he was deemed resigned, nevertheless, there was a from over sexed superiors.
showing that the policy that it was not properly
promulgated and made to know to all employees. Thus,
the filing of his COC, he is ordered reinstatement with Domingo vs. Rayala
backwages. There is no need that there be a demand, request or
requirement of a sexual favor as a condition for
5. Continuation of Employment is Prohibited By continued employment or for promotion to a higher
Law position.

Great Pacific Life vs. NLRC The fact that the employer was squeezing the shoulders
The Court held therein that an indemnity, not of the employee, running his fingers across her neck and
"separation pay", must be imposed on the employer for tickling her ear with the alleged promise of giving her
failure to observe the procedural requirements of notice money for school expenses was already sufficient to
and hearing prior to the dismissal of an employee for dismiss the employee.
just cause. Considering the circumstances of the case at
bar, petitioner must indemnify.
Aquino vs. Rayala
6. Sexual Harassment The acts of Acosta was usual gestures of friendship
during festive occasions with people present could not be
Villarama vs. NLRC held as one which is sexual harassment.
He refused to be terminated on the ground that the
seriousness of his offense would not warrant his
separation from service. So he alleged in his letter to Mr. 7. Resignation
Prieto dated August 16, 1989. But even in this letter,
petitioner admitted his "error" vis-a-vis Miss Gonzaga. Phil. Overseas Drilling vs. Minister
As a manager, petitioner should know the evidentiary It appears that complainant was a Chief Geologist of the
value of his admissions. Needless to stress, he cannot respondent since 1969 up to December 18, 1979, earning
complain there was no valid cause for his separation. a monthly salary of P6,740.00. Admittedly, the
complainant filed his resignation letter on August 29,
Moreover, loss of trust and confidence is a good ground 1979 effective September 30, 1979. For failure of
for dismissing a managerial employee. petitioner acted in respondent to act upon his resignation, complainant
collusion with the immoral designs of De Jesus and did wrote a letter on November 20, 1979 requesting for the
not give due regard to Gonzaga's feeling on the matter payment of his retirement and/or separation benefits
and acted in chauvinistic disdain of her honor, thereby similarly granted to employees per company’s standing
justifying public respondent's finding of sexual policy. Much to complainant’s dismay, he received
harassment. Thus, petitioner not only failed to act instead a report of resignation from the respondent on
accordingly as a good father of the family because he was December 7, 1979, indicating his resignation on
not able to maintain his moral ascendancy and authority September 29, 1979.
over the group in the matter of morality and discipline

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That there was a company policy to grant separation doctrine in Kestrel, the conclusive presumption that the
benefit or pay equivalent to one (1) month pay for every respondent is totally and permanently disabled thus
year of service to employees who were similarly situated arose. The CA is therefore correct in declaring that
as private respondent, is supported by substantial respondent suffered permanent total disability.
evidence which means "such relevant evidence as a
reasonable mind might accept as adequate to support a 9. Detention by Military without Basis Merely
conclusion." (Ang Tibay v. CIR, 69 Phil. 635; Cañete v. Suspends Employment and Does Not Justify
Workmen’s Compensation Commission, May 8, 1985, Dismissal
136 SCRA 302, 308). Documents to this effect were
presented by private respondent at the hearing on Magtoto vs. NLRC
January 24, 1980 as Annexes "D" thru "D-7" of his Magtoto was working with Wyeth-Suaco Laboratories,
position paper. Inc. On September 3, 1980, Magtoto was arrested by
virtue of an ASSO who was charged with violation of
Having found that there was a company policy to that Art. 136 and 138 of the Revised Penal Code for
effect, respondent Director correctly held that private Conspiracy and Proposal to Commit Rebellion and Art.
respondent was legally entitled to a separation benefit or 138 of the Revised Penal Code.
pay equivalent to one (1) month pay for every year of
service, notwithstanding the fact that he had voluntarily The employer tries to distance itself from the detention
resigned. by stressing that the petitioner was dismissed due to
prolonged absence. However, Mr. Magtoto could not
8. Permanent Disability report for work because he was in a prison cell. The
detention cannot be divorced from prolonged absence
Alpha Ship Management Corporation et. al vs. Eleosis neither can it be called abandonment. One caused the
V. Calo other. Since the causes for the detention, which in turn
It can be said that an employee’s disability becomes gave the employer a ground to dismiss the petitioner,
permanent and total when so declared by the company- proved to be non-existent, we rule that the termination
designated physician, or, in case of absence of such a was illegal and reinstatement is warranted.
declaration either of fitness or permanent total disability,
upon the lapse of the 120 or 240 -day treatment period, Only 25 days from his arrest, the petitioner was
while the employee’s disability continues and he is unable dismissed from his job. When the petitioner tried to
to engage in gainful employment during such period, return to work immediately after his release, the
and the company-designated physician fails to arrive at a employer gave him the same excuse that its report to the
definite assessment of the employee’s fitness or disability. Ministry of Labor and Employment was pending action
This is true "regardless of whether the employee loses the and, therefore, reinstatement was “inappropriate.”
use of any part of his body."
The cause for which the petitioner was separated from
Respondent was repatriated on October 12, 2004 and work was found to be non-existent, and thus, the
underwent treatment by the company-designated dismissal of the petitioner was without just cause.
physician, Dr. Cruz, until October 14, 2005, or for a
continuous period of over one year–or for more than the
statutory 120-day or even 240-day period. During said
treatment period, Dr. Cruz did not arrive at a definite 10. CARL
assessment of respondent’s fitness or disability; thus,
respondent’s medical condition remained unresolved. It NFL vs. NLRC
was only on July 18, 2006 that respondent was declared fit The closure of the plantation due to the act of the
to work by Dr. Cruz. Such declaration, however, became government to benefit the petitioners, as members of the
irrelevant, for by then, respondent had been under Patalon Estate Agrarian Reform Association, by making
medical treatment and unable to engage in gainful their agrarian lot beneficiaries of said estate, the
employment for more than 240 days. Pursuant to the petitioners are not entitled to separation pay.

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the employee, and it involves a demotion in rank or

11. Constructive Dismissal diminution of salaries, benefits and other privileges.

OSS Security vs. NLRC In the case at bench, nowhere in the record does it show
As a lady security guard she was assigned to render that that the transfer of private respondent was anything
security services to the different clients of petitioner.5 but done in good faith, without grave abuse of
She was last assigned at the Vicente Madrigal discretion, and in the best interest of the business
Condominium II located in Ayala Avenue, Makati.6 enterprise.

In a memorandum dated July 30, 1991 addressed to In the employment of personnel, the employer can
petitioner's company President, retired General Honesta prescribe the hiring, work assignments, working
Isleta, the Building Administrator of VM Condominium methods, time, place and manner of work, tools to be
II, Licerio E. Baguyong, complied of the laxity of the used, processes to be followed, supervision of workers,
guards in enforcing security measures. working regulations, transfer of employees, work
supervision, lay-off of workers and the discipline,
In compliance therewith10, petitioner issued Duty Detail dismissal and recall of work, subject only to limitations
Order No. 0044611 on August 1, 1991 relieving private imposed by laws.
respondent and another lady security guard, Digna
Suelan, of their assignment at VM Condominium II 12. Merger or consolidation
effective August 2, 1991 for reassignment to other units
or detachments where vacancy exists. BPI vs. BPI Employees Union-Davao
The Union Shop Clause in the CBA between BPI and
On August 3, 1991, petitioner issued Duty Detail Order BPI Union must be respected. Failure of an employee to
No. 0060112, which detailed private respondent to the join the union is authorized cause for BPI.
Minami International Corporation in Taytay, Rizal from
August 3 to September 2, 1991 to replace lady security Unionism > security of tenure
guard Susan Tan who filed her vacation leave for August
1991. However, it appears that private respondent did Nevertheless, they shall be afforded ample opportunity
not report for duty at her new assignment. to whether or not to join the union.

ervice-oriented enterprises, such as petitioner's business

of providing security services, generally adhere to the 13. Union Officers who knowingly participate in an
business adage that "the customer or client is always ILLEGAL STRIKE
right". To satisfy the interests, conform to the needs, and
cater to the whims and wishes of its clients, along with Jackbilt vs. Jackbilt Industries
its zeal to gain substantial returns on its investments, Art. 294(e) of the Labor Code prohibits any person
employers adopt means designed towards these ends. engaged in picketing from obstructing the free ingress to
These are called management prerogatives in which the and egress from the employer’s premises.
free will of management to conduct its own affairs to
achieve its purpose, takes from. Accordingly, an When the employees have been found to prevented the
employer can regulate, generally without restraint, free entry into and exit of vehicles from petitioner’s
according to its own discretion and judgment, every compound act, respondent’s officers and employees
aspect of business. clearly committed illegal acts in the course of March 9,
1998.
Thus, the transfer of an employee ordinarily lies within
the ambit of management prerogatives. However, a Thus, the unlawful means in the strike made the strike
transfer amounts to constructive dismissal when the illegal. No need for the filing to declare the strike as
transfer is unreasonable, inconvenient, or prejudicial to illegal.

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14. Union Officers and member who participate in 1) The employment qualification is reasonably
a PROHIBITED STRIKE related to the essential operation of the job
2) There is basis for believing that all or
St. Scholastica’s College vs. Torres substantially all persons would be unable to
perform the duties of the job

All these must be proven by the employer.

15. Violation of Exogamy Policy
17. Test Results
Duncan vs. Glaxo-Welcome
Exogamy – the rule requiring selection of a marriage Plantation Bay Resort vs. Dubrico
partner outside of a particular group. The fact that the confirmatory test results came first
before the drug testing cannot be the basis for the
In this case, the prohibition of marrying an employee of termination of the employees. There shall drug testing
the competitor company is valid. first before the test results were released.

It is only reasonable for the prohibition of marital But again, failure to present to drug tests is both serious
relationship with the other company because these misconduct and willful breach of lawful orders.
relationships might compromise the interests of Glaxo.
18. Knowingly violating the Union Security Clause
Dai-Chi Electronics Manufacturing Corp vs. Villarama stipulated in the CBA
Anti-Competition Clause
General Milling Corp. vs. Casio et. al
“For a period of 2 years, the employee shall not be In terminating the employment of an employee by
connected or to be a consultant and/or be an informative enforcing the union security clause, the employer needs
body directly with any business firm, entity or only to determine and prove that:
undertaking engaged in a business similar to or in (1) the union security clause is applicable;
competition with that of the employer” (2) the union is requesting for the enforcement of the
enforcement and
Issues as to damages regarding this law, are NOT (3) there is sufficient evidence to support the decision of
before the Labor Arbiter but before the regular courts. the union to expel the employee from the union.

If an employee violated the rule under this law and an PICOP Resources vs. Tañeca
employer files for an action for damages, he cannot go There was no sufficient evidence to support the decision
before the LA but before civil courts. of the union to expel the employee from the union. The
mere signing of the Election of FFW is not sufficient
ground to terminate the employment. Nothing in the
16. No-Spouse Employment Policy records would show that the respondents failed to
maintain their membership in good standing in the
Star Paper vs. Simbol Union.
For there to be a no-spouse employment policy there
must be a bona fide occupational qualification which 19. For Schools: Failure of Regular Faculty
justifies an employer’s no-spouse rule, the exception is Members to Obtain a Minimum Efficiency
interpreted and narrowly by these state courts. There Rating of 85% in two previous school years as
must be a compelling business necessity for which no required by the school’s teacher manual
alternative exists other than the discriminatory
practice.
Peña vs. NLRC and Naga Parochial School

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The fact that there is no evidence in this case does not

bear our petitioner’s misgivings. To the contrary, it PROCEDURAL ASPECT
appears that only the six petitioners out of the school’s
47 teachers, failed to obtain the grade of 85% 1. Two notices in a dismissal with JUST CAUSE:
a. To those affected employees;
b. To the employer (show cause or explain)
ST. Mary’s Dipolog City vs. Palacio c. The subsequent notice providing for the dismissal
A DECS Memo was passed that teachers must already and what were the grounds for such.
be able to register as professional teachers on September d. There is no payment of separation pay if it was an
19, 2000. act imputable to the employer

The same law provides a grace period that those who

failed the examination between 1996 and 2000 shall PEREZ VS. DORIA
continue teaching if they obtain temporary or special Ample opportunity to be heard may in fact include an
permits as para-teachers. actual hearing but it is not limited to a formal hearing only.

However, the teachers here were terminated on March IMPORTANT:

31, 2000, way before September 19, 2000 (which is the The Perez vs. Doria doctrine DOES NOT ABSOLUTELY
deadline set forth by the law). PROHIBIT the holding of a formal hearing.

Although at such time, the dismissal was premature but In other words, the actual or formal is not absolutely
there could no longer be an order for reinstatement necessary to satisfy the employee’s right to be heard.
since they were still unable to register after September A) Ample opportunity to be heard means any
19, 2000. They can only be entitled to backwages of meaningful opportunity verbal or written given to
March 31 – September 19. the employee to answer the charges against him
and submit evidence in support of his defense.
B) Formal hearing is mandatory only when requested
by the employee in writing or substantial
20. Probationary Employment evidentiary or when the company rule or practice
requires it or when similar circumstances justify it.
Abbott Laboratories vs. Alcaraz C) Ample opportunity to be heard under the LC >>>
The requirements needed on the part of the employer for hearing and conference requirement under the
probationary employment: IRR
1. Communicate the duration of the probationary
period AS TO THE ISSUE ON ACTUAL ADVERSARIAL
2. Communicate the regularization standards PROCEEDINGS:
3. Both of these are communicated at such time of 1. Actual adversarial proceedings may be necessary
the employee’s engagement for clarification purposes or when there is a
propound searching questions to unclear
Exception where there is no need to comply with these witnesses.
requirements are: 2. Must be made before the Labor Arbiter.
1) Jobs which are self-descriptive in nature for
instance, in the case of maids, cooks, drivers or In application of Perez Doctrine
messengers. 1. When the notice of preventive suspension
2) Employee acts in contrary to basic knowledge required the employees to explain within 48 hours
(even if it is not provided in the regularization) to show cause why = ample opportunity to be
and was not able to perform the duties and heard.
regularization is a justifiable basis for a
probationary employee’s non-regularization.

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PROCEDURE for DISMISSAL with JUST CAUSE IN A • From the general manager
NUTSHELL:
• The official notice of DISMISSAL.
First Notice: Notice to the EE (by the employer)
• Apprises you of the acts of omissions that IMPORTANT:
constitute the just cause of your termination. Even if dismissed with cause or fault on the part of the
• This must be a written notice. employee, the employee is still entitled to:
• Gives the employee at least 72 hours to explain 1. Accrued pay starting from the last time he
in writing why he shall not be dismissed. received his paycheck until the day of termination.
2. 13th month pay.
IMPORTANT: Even if the employee is ignorant or does not
know how to read there shall still be a written notice for
compliance of the law. CONSEQUENCE WHEN THERE IS JUST CAUSE but
THE EMPLOYER DID NOT FOLLOW THE NOTICE
Second Notice: Notice to the ER REQUIREMENTS:
1. The employee is not entitled reinstatement
• The employee will explain within 5 calendar days
2. No separation benefits
from receipt of the first notice sent by the ER.
3. The dismissal is valid; no illegal termination
• If there is silence on the part of the employee, 4. The employer is liable for a fine.
the investigation will continue, ex-parte.
• If the EE refuses to receive notice = serve it
through registered mail to the last known TERMINATION
address,
• But when there is an admission on the part of the Termination is the cessation of an employment due to an
employee, there is no longer any proceedings. authorized cause, which is not the fault of the employee.
The proceeding or investigation will be rendered
as superfluous. As a rule, termination carries with it separation pay.
Termination does not always carry with it separation pay (e.g.
Thus, in a dismissal with just cause there must closure of business due to financial reversal)
be at least two notices which are indispensable,
it cannot be lower than two notices but may be Termination on an authorized cause means that there is an
more than two notices. existing ground which the law itself allows or authorizes to
be invoked to justify the termination of an employee even
IMPORTANT: if he has not committed any wrongful act or omission.
1. A confession made by an alleged co-conspirator
cannot be the basis of dismissing the employee, it Authorized causes:
must be corroborated with other evidences. 1. Installation of labor-saving devices
2. Redundancy
• When adversarial proceedings is wanting because 3. Retrenchment
company policy allows such, then the employee is 4. Resignation
not precluded from having or bringing his own 5. Closure or cessation of business operations BY
counsel. REASON of financial reverses or business losses
6. Closure or cessation of business operations
Third Notice (but second notice from the ER): The findings of NOT BY reason of financial reverses
fact and recommendations.
Health-related Causes:
• There must be the second notice from the 1. Disease
employer which is made by the lawyer stating
therein what are the grounds for the dismissal and COMMON GROUNDS FOR ALL OF THE FIVE
justifications. GROUNDS AND INDISPENSIBLE

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2. Secretary of Labor assumed jurisdiction over a

1. There is good faith in effecting the termination; Labor Dispute
2. It must be the last resort
3. Two separate notices: INSTALLATION OF LABOR-SAVING DEVICES
a. To those affected employees; and
b. To the DOLE at least one month prior to the 1. It must be that the reason for labor-saving devices
intended the termination; is to save cost, enhance efficiency, and other
• The one month period is for the determination justifiable reasons
whether the termination for authorized caused is 2. Redundancy may result from installation of labor-
appropriate saving device
3. Proof of losses is not required.
c. After the one month period from the notice
filed, there must be payment of separation REDUNDANCY
benefits, if owing
1. Services are in excess of what is demanded by the
4. Separation Pay enterprise
2. Position is superfluous because of a number of
When is separation pay paid: factors
a) Installation of Labor-Saving Device or 3. When there is a duplication of work and two or
b) Redundancy more person doing the work of one person
c) Based on Retrenchment to Prevent Losses or 4. May be resorted as a cost-cutting measure but
d) Closure was NOT due to serious losses DOES not need to be always triggered by a
decline in the business.
When NO separation pay is needed to be paid:
a) When Closure was DUE to serious losses (wala na IMPORTANT:
kay mapuga sa employer) 1. The wisdom of redundancy is not subject to
review by labor authorities and courts.
5. Fair and reasonable criteria in ascertaining what 2. Evidence of losses is not required.
are positions affected by the termination 3. Act of the employer hiring new employees IS
NOT BAD FAITH if the positions have no
IMPORTANT: similar job descriptions
1. If there is a CBA that provides for a higher 4. LIFO have no basis in law.
separation pay, then the CBA shall prevail.
2. The proof of whether there is business losses or If there is a redundancy or even a retrenchment, the
financial reverses is applicable to retrenchment to employees cannot demand a LIFO (Last In, First Out
know whether to be valid and legal. Scheme) because the employer also has to weigh the
performance, nature or skill of the employee.
EFFECTS IN CASES WHERE THE EMPLOYER DOES
NOT FOLLOW THE NOTICE REQUIREMENT AND 5. LIFO is not a mandatory basis for redundancy.
THERE IS VALID TERMINATION WITH AUTHORIZED 6. The wisdom of redundancy and who to retain is
CASE on the part of the employer.
7. Redundancy can be a result of over hiring in the
• The termination is valid; no illegal dismissal
first place.
• The employer will pay fine of 50,000 or up.
RETRENCHMENT
INSTANCES THAT REMOVES THE LABOR ARBITER
OF TERMINATION DISPUTES 1. There should be proof of actual losses or
possible imminent losses
1. Voluntary Arbitration

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• Otherwise, the retrenchment will lead to illegal • FR. GUS: You cannot squeeze blood out of a
dismissal turnip.

2. There is loss which is either imminent or actual. IMPORTANT:

3. There will only be a cutting-down of employees to 1. The fact that there was a closure for 6 months
save costs. does not justify losses (always resort to audited
financial statements).
RETRENCHMENT
1. Only statutory ground which requires proof of Manila Polo Club Employee’s Union vs. Manila Polo
actual losses Club
2. When there is retrenchment, there is no closing 1. Closure may either be partial or total.
down of operations, there is just a cutting-down 2. Closure or cessation of operations of
of employees as needed to prevent more losses. establishment or undertaking may or may not
3. There is no need that the employer must have be due to serious business losses
suffer the losses before he can retrench.
4. Cost-reduction must have been resorted to by the Regardless: There must be showing that it was
employer before immediately terminating his done in good faith and a written notice on (1)
employees. the affected employees and (2) DOLE is
served at least one month before the intended
Retrenchment to Retrenchment by reason of date of termination of employment.
PREVENT LOSSES ACTUAL LOSSES
There is need to pay No more need to pay any 3. The employer can lawfully close shop even if
separation pay of 1 month separation pay. not due to his serious business losses or
pay or at least ½ month financial reverses but needs to separation pay,
pay for every year of which is equivalent to at least one month or
service, a fraction of 6 one half month per year of service as
months is considered a provided for Art. 297 (283) of the Labor
year Code.
4. If the grounds is by reason of financial losses,
IMPORTANT: the employer must prove such allegation to
1. If there has been a cutting-off of employees and avoid the payment of separation pay.
most of the employees that have been cut-off are
union members = there is arbitrary exercise of RETRENCHMENT CLOSURE OF BUSINESS
retrenchment; there is illegal dismissal. DUE TO FINANCIAL
LOSSES
Down-sizing, but the There is already a closing
CLOSURE OR CESSATION OF BUSINESS OPERATIONS business or enterprise will down of the business
continue to operate establishment
1. When NOT due to serious business losses or There is a need to reduce There is a need to
financial reverses the personnel due to poor terminate employee to
• Separation pay is required: 1 month pay or at financial returns or labor- prevent further financial
least ½ month pay for every year of service, a saving devices drain who cannot pay
fraction of 6 months is considered a year. anymore his employees.

2. When DUE TO SERIOUS business or financial DISEASE

reverses
• Separation pay is NOT required. Requirements:
1. An employee who has been found suffering from
any disease;

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2. His continued employment is: Immediate reinstatement is a consequence of illegal

a. Prohibited by law or dismissal.
b. Prejudicial to his health OR health of his
co-employees; and It shall be immediately executory and mandatory for the
c. A competent public health authority issues a employer to reinstate the employer to comply. No need for
certificate that the disease of such nature or motion of execution.
at the state that it cannot be cured within a
period of 6 months even with proper medical Pioneer Texturizing vs. NLRC
treatment If a judgement was ordered or awarded a reinstatement from
the LA it is self-executory, meaning it does not require a writ
PRINCIPLES: of execution. The employer has the duty of submitting a
1. There can be applicability of this ground if the compliance report within 10 days from the decision that he
employee suffered from several strokes which has reinstated the employee.
would be prejudicial to his continued employment.
2. An employee suffering from HIV/AIDS cannot be If the employer fails to reinstate the employee, then it is from
terminated on the basis of this law per se. then that the LA will issue a writ.
3. The absence of a medical certificate is
INDISPENSIBLE, the absence of a medical AGAIN: As a rule, there is no need for a writ of execution
certificate from a competent public health or motion to be reinstated. Only after there is non-
authority is required by law to prove the existence compliance by the employer, will there be an issuance of a
of the disease itself. writ.
4. There is separation benefits because it is not a
fault on the part of the employer. PRINCIPLES:
5. Disease is considered an authorized cause because 1. Illegal dismissal is not a violation of due process
it is not due to the fault of the employee. So he is because due process clause under the Constitution
entitled to separation pay (although the 6 months is only applicable in cases where it is against the
for rest and medication have no pay). government and NOT the employer.

WHAT IF THE DECISION, REINSTATING THE

Twin-notice requirement: EMPLOYEE IS APPEALED?
1. He must be notified that the dismissal is being
sought; GARCIA, ET. AL VS. PAL IN THE CASE OF UIC VS.
2. The notice informing the employee of his ATTY. CARLOS, PH. D
dismissal, to be issued after the employee has
been given a reasonable opportunity to answer The situation:
and be head on his defense. Jenna was illegally dismissed by his employer Z company.
3. FUJI RULE: The right of the employee to present Jenna instituted an action against Z company. It has been
countervailing medical certificates that he is fit to adjudged by the Labor Arbiter that Jenna was illegally
work. dismissed and Z company must reinstate Jenna.

Z company appealed the decision of reinstatement. The

ILLEGAL DISMISSAL AND ITS EFFECTS NLRC later on reversed the order of the LA and ruled that
Jenna was not illegally dismissed and that her dismissal was
Illegal dismissal is where the employee was dismissed with just.
just cause or an act imputable against him OR where the
termination has no basis in cases, but was later on proven Rule:
that he was innocent. From the time that the LA has decided to reinstate, the
employer is under the obligation:
a. to reinstate the employee and

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b. pay the wages Genuino Doctrine

1. If there is reversal of the order of reinstatement,
This shall be done from the time span of the decision until the employer has the right to require the employee
the reversal by the NLRC. to refund the salaries.
2. Abolished by the Court because it disregards the
This is called payroll reinstatement. social justice principles.
3. It makes the salaries given to the employee pending
If the NLRC decides that it reverses the decision of the LA, appeal as a bond posted in installment by the
the employee is NOT obliged to return the wages paid to employer.
him pending appeal.
TAKE NOTE:
BASICALLY: 1. There can be a demand for attorney’s fees if by
1. LA – illegal dismissal + reinstate reason of the dismissal, the employee has to resort
NLRC – reverses to judicial processes and was later on found out to
have been illegally dismissed.
The period of appeal from LA to NLRC, the EE is entitled 2. There can be an award for moral damages as well:
to reinstatement immediately and payment of wages. a. When the employee was dismissed in a
humiliating and degrading manner (even if
2. LA – illegal dismissal + reinstate the dismissal was proper)
NLRC – affirms b. Found to have been illegally dismissed
(regardless if stated in the position paper)
The period of appeal from LA to NLRC, the EE is entitled
to reinstatement immediately and payment of wages. Upon IMMEDIATE REINSTATEMENT IN RETURN TO WORK
decision of the NLRC, no obligation on the part of the EE CASES UNDER Art. 263 (g)
to return what he has received.
When, in his opinion, there exists a labor dispute causing or
3. LA - illegal dismissal + reinstate likely to cause a strike or lockout in an industry indispensable
to the national interest, the Secretary of Labor and
NLRC – affirms
Employment may assume jurisdiction over the dispute and
CA decide it or certify the same to the Commission for compulsory
arbitration. Such assumption or certification shall have the
The period of reinstatement is interrupted upon effect of automatically enjoining the intended or impending
affirmation to the NLRC going up to the CA. strike or lockout as specified in the assumption or certification
order. If one has already taken place at the time of assumption
TAKE NOTE: or certification, all striking or locked out employees shall
The same rule applies where the ER-EE will submit their immediately return-to-work and the employer shall
case before the voluntary arbitrator. immediately resume operations and readmit all workers under
the same terms and conditions prevailing before the strike or
1. VA – illegal dismissal lockout. The Secretary of Labor and Employment or the
Commission may seek the assistance of law enforcement
CA – reversal or affirmation
agencies to ensure compliance with this provision as well as
with such orders as he may issue to enforce the same.
There will still be an immediate reinstatement or payment
of wages in either situation regardless if the appeal will University of Immaculate Concepcion vs. Sec.
reverse or affirm. When the SOLE has already assumed jurisdiction and has
issued a return-to-work and the employer will resume
TAKE NOTE: operations, the SOLE can order the employer to reinstate
1. The GARCIA, ET. AL VS. PAL (decided En Banc employees terminated by the employer even if those
by Carpio Morales) ruling ABANDONED the terminated employees are not part of the bargaining unit.
Genuino doctrine.
PLDT vs. Manggagawa

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Once the SOLE would already acquire jurisdiction and order

a return to work order, the reinstatement by virtue of which
will also affect those who have been terminated employees as
not part of the bargaining unit and their termination is
covered by a decision of the voluntary arbitrator, even if they
have already received their termination benefits.

WHEN IS THERE NO TERMINATION OF

EMPLOYMENT

1. Where there is BONA FIDE SUSPENSION of the

business for a period not exceeding six months; or

2. When the employee is under civic or military duty

• The employee is entitled to his salaries during
training period

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