[ G.R. No.

197852, October 19, 2015 ]

PASIG AGRICULTURAL DEVELOPMENT AND INDUSTRIAL SUPPLY CORPORATION AND CELESTINO E. DAMIAN, petitioners, vs. WILSON NIEVAREZ,
ALBERTO HALINA, GLORY VIC NUEVO, RICKY TORRES AND CORNELIO BALLE, respondents.

FACTS:
Herein respondents are regular employees of PADISCOR. They were hired as machinist, tool keeper/timer, helper, welder, and maintenance worker with a daily
wage of P350.00. On June 17, 2006, PADISCOR sent notices to Nievarez, Torres and Nuevo informing them that they were temporarily laid off from employment
for a period of six months and cited that it can no longer pay their wages and other benefits due to financial losses and lack of capital and due to other factors such
as unauthorized absences, habitual tardiness, negligence, dishonesty and others. In a Memorandum dated June 24, 2006, PADISCOR required Nievarez to submit
a written explanation why a disciplinary action should not be imposed against him for his unjustified refusal to perform assigned tasks. Nievarez submitted his
explanation expounding on his need to receive a memorandum before he be assigned to a task as protection from unfounded accusations, and demanded an
additional wage. PADISCOR dismissed the explanations and demands of Nievarez for being ridiculous and baseless and suspended him from work for fifteen (15)
days for insubordination.
On September 5, 2006, Balle and Halina received notices similar from the other respondents informing them of their temporary lay-off from employment for six
months. Respondents filed complaints for illegal suspension, illegal lay-off, non-payment of service incentive leave and paternity leave, damages and attorney's fees
against PADISCOR and Damian.
Petitioners asserted that the suspension of Nievarez was valid since he was guilty of insubordination and misconduct, which was a repetition of a previous offense
and further alleged that Nievarez made ridiculous conditions such as written memorandum defining his duties, and a promotion or a raise in wage before he completes
his assigned task. PADISCOR maintained that the six months temporary lay-off of respondents was valid due to economic reasons and that it gave one-month prior
notice to respondents regarding the temporary retrenchment and filed Establishment Termination Reports with DOLE. It averred that there was no dismissal since
the lay-off was merely temporary, thus, respondents are not entitled to separation pay.
The Labor Arbiter dismissed the complaint for illegal lay-off and illegal suspension for lack of merit but awarded the payment of service incentive leave in favor of
respondents and held that the power to instill discipline in the workplace is part of petitioner’s management prerogative. The NLRC agreed with the findings of the
LA that the temporary lay-off of respondents was valid. However, by petition for certiorari, the CA ruled that the LA and the NLRC committed grave abuse of discretion
in sustaining respondents' temporary suspension from work and remanded to the Labor Arbiter for the computation of backwages due to said temporary lay-off of
service.

ISSUE: Whether or not the CA erred in holding that petitioners’ exercise of its management prerogative to temporarily lay-off employees is illegal in view of its failure
to present financial statements to evidence its financial losses.

RULING:
The Court finds the petition without merit. Jurisprudence, in both a permanent and a temporary lay-off, dictates that the one-month notice rule to both the DOLE and
the employee under Article 283 (now Article 298) is mandatory. Also, in both cases, the layoff, as an exercise of the employer's management prerogative, must be
exercised in good faith - that is, one which is intended for the advancement of employers' interest and not for the purpose of defeating or circumventing the rights of
the employees under special laws or under valid agreements.
In light of the well-entrenched rule that the burden to prove the validity and legality of the termination of employment falls on the employer and the requisites provided
by Article 286 (now Article 301) of the Labor Code, PADISCOR should have established the bona fide suspension of its business operations or undertaking that
would have resulted in the temporary lay-off of the respondents for a period not exceeding six (6) months in accordance with the Labor Code.
In the present case, PADISCOR failed to prove its compliance with the said requisites. In invoking such article in the Labor Code, the paramount consideration
should be the dire exigency of the business of the employer that compels it to put some of its employees temporarily out of work.45 This means that the employer
should be able to prove that it is faced with a clear and compelling economic reason which reasonably forces it to temporarily shut down its business operations or
a particular undertaking, incidentally resulting to the temporary lay-off of its employees.

PANTOJA VS. SCA

G.R. No. 163554
APRIL 23, 2010
FACTS: Respondent, a corporation engaged in the manufacture, sale and distribution of industrial paper and tissue products, employed Pantoja and was eventually
assigned at respondent’s Paper Mill No. 4, the section which manufactures the company’s industrial paper products, as a back tender in charge of the proper
operation of the section’s machineries.
In a Notice of Transfer, respondent informed petitioner of its reorganization plan and offered him a position at Paper Mill No. 5 under the same terms and conditions
of employment in anticipation of the eventual closure and permanent shutdown of Paper Mill No. 4 . The closure and concomitant reorganization is in line with
respondent’s decision to streamline and phase out the company’s industrial paper manufacturing operations due to financial difficulties.
However, petitioner rejected respondent’s offer for his transfer. Thus, a notice of termination of employment was sent to petitioner as his position was declared
redundant by the closure of Paper Mill No. 4. He then received his separation pay and thereafter executed a release and quitclaim in favor of respondent. later,
respondent informed the DOLE of its reorganization and partial closure by submitting with the said office an Establishment Termination Report together with the list
of 31 terminated employees.
Petitioner filed a complaint for illegal dismissal against respondent assailing his termination as without any valid cause. He averred that the alleged redundancy
never occurred as there was no permanent shutdown of Paper Mill No. 4 due to its continuous operation since his termination.
In its defense, respondent refuted petitioner’s claim of illegal dismissal. It argued that petitioner has voluntarily separated himself from service by opting to avail of
the separation benefits of the company instead of accepting reassignment/transfer to another position of equal rank and pay. According to respondent, petitioner’s
discussion on the alleged resumption of operation of Paper Mill No. 4 is rendered moot by the fact of petitioner’s voluntary separation.
the Labor Arbiter rendered a Decision dismissing petitioner’s complaint for lack of merit. Upon appeal by petitioner, the NLRC reversed the Labor Arbiter’s
Decision by finding petitioner’s separation from employment illegal. The NLRC gave credence to petitioner’s evidence of Paper Mill No. 4’s continuous operation.
Respondent sought reconsideration of the NLRC’s ruling**, which was however denied. Respondent filed a petition for certiorari with the CA, which reversed the
NLRC’s Decision and reinstated the Labor Arbiter’s Decision dismissing the complaint. It ruled that there was no illegal dismissal as the act of petitioner in rejecting
the transfer and accepting the separation pay constitutes a valid basis for the separation from employment. Respondent’s Motion to Annul the NLRC’s Entry of
Judgment was granted by the CA. Petitioner’s MR was denied
ISSUE: WON there was illegal dismissal
HELD: WHEREFORE, the petition is DENIED. The assailed Decision of the CA dismissing petitioner complaint for illegal dismissal and the Resolution denying the
MR are AFFIRMED.
NO
Respondent presented evidence of the low volume of sales and orders for the production of industrial paper in 1999 which inevitably resulted to the company’s
decision to streamline its operations. Exercising its management prerogative and sound business judgment, respondent decided to cut down on operational costs
by shutting down one of its paper mill. As held in International Harvester Macleod, Inc. v. IAC , the determination of the need to phase out a particular department
and consequent reduction of personnel and reorganization as a labor and cost saving device is a recognized management prerogative which the courts will not
generally interfere with. Apparently, respondent implemented its streamlining or reorganization plan with good faith, not in an arbitrary manner and without prejudicing
the tenurial rights of its employees.
As long as no arbitrary or malicious action on the part of an employer is shown, the wisdom of a business judgment to implement a cost saving device is beyond this
court’s determination. After all, the free will of management to conduct its own business affairs to achieve its purpose cannot be denied.
NOTES:
the reason why Paper Mill no. 4 continued it operation after the separation of Pantoja:
Respondent sought reconsideration of the NLRC’s ruling. It denied the fact that Paper Mill No. 4 continued to be fully operational in 1999. Respondent asseverated
that when Paper Mill No. 4 was shut down in 1999 due to its low production output as certified in an affidavit executed by SCA’s VP-Tissue Manufacturing Director,
there was a necessity to occasionally run from time to time the machines in Paper Mill No. 4 only for the purpose of maintaining and preserving the same and
does not mean that Paper Mill No. 4 continued to be operational. It was only in 2000 that Paper Mill No. 4 was subsequently reopened due to a more favorable
business climate, which decision is recognized as a rightful exercise of management prerogative.

CHATEAU ROYALE SPORTS AND COUNTRY CLUB, INC., Petitioner, v. RACHELLE G. BALBA and MARINEL N. CONSTANTE, Respondents
G.R. No. 197492, January 18, 2017

TOPIC: Constructive dismissal

PONENTE: Bersamin
FACTS:
Petitioner Chateau Royale hired respondents as Account Executives. They were then promoted to Account Managers after almost a year. As part of their
duties, respondents were instructed by the Director of Sales and Marketing to forward all proposals, event orders and contracts for an orderly and
systematic bookings in the operation of the petitioner’ s business. However, they failed to comply with the directive. Accordingly, a notice to explain was served on
them, to which they promptly responded.
After investigation, respondents were found to have committed acts of insubordination, and that they were suspended for seven (7) days. However, said suspension
order was lifted before its implementation.
Respondents then filed a complaint for illegal suspension and non-payment of allowances and commissions. Respondents amended their complaint to
include constructive dismissal based on their information from the Chief Financial Officer of the petitioner on the latter’s plan to transfer them to the Manila Office.
The proposed transfer was prompted by the shortage of personnel at the Manila Office as a result of the resignation of three account managers and the director of
sales and marketing. Despite attempts to convince them to accept the transfer to Manila, they declined because their families were living in Nasugbu, Batangas.
LA found that respondents had been constructively dismissed. NLRC reversed the same and dismissed the complaint for lack of merit. CA granted the petition
for certiorari and set aside NLRC’s decision.
ISSUE:
Whether or not the transfer of respondents constitutes constructive dismissal.
HELD: NO.
The Supreme Court held that the petitioner was able to discharge its burden, and thus established that, contrary to the claim of the respondents that they had
been constructively dismissed, their transfer had been an exercise of the petitioner’s legitimate management prerogative.
First, the resignations of the account managers and the director of sales and marketing in the Manila office brought about the immediate need for their
replacements with personnel having commensurate experiences and skills. With the positions held by the resigned sales personnel being undoubtedly crucial to the
operations and business of the petitioner, the resignations gave rise to an urgent and genuine business necessity that fully warranted the transfer from the
Nasugbu, Batangas office to the main office in Manila of the respondents, undoubtedly the best suited to perform the tasks assigned to the
resigned employees because of their being themselves account managers who had recently attended seminars and trainings as such.
Secondly, although the respondents’ transfer to Manila might be potentially inconvenient for them because it would entail additional expenses on their part
aside from their being forced to be away from their families, it was neither unreasonable nor oppressive. The petitioner rightly points out that the transfer
would be without demotion in rank, or without diminution of benefits and salaries.Instead, the transfer would open the way fo r their eventual career
growth, with the corresponding increases in pay.
Thirdly, the respondents did not show by substantial evidence that the petitioner was acting in bad faith or had ill-motive in ordering their transfer.
In contrast, the urgency and genuine business necessity justifying the transfer negated bad faith on the part of the petitioner.
Lastly, the respondents, by having voluntarily affixed their signatures on their respective letters of appointment, acceded to the terms and
conditions of employment incorporated therein. One of the terms and conditions thus incorporated was the prerogative of management to transfer and re-assign
its employees from one job to another “as it may deem necessary or advisable.”

(Flordeliza Maria Reyes-Rayel vs. Philippine Luen Thai Holdings Corp./L&T International Group Philippines, Inc., G.R. No. 174893, July 11, 2012 citing
Perez v. Philippine Telgraph and Telephone Company, G.R. No. 152048, April 7, 2009, 584, SCRA 110).

FACTS:
ON SEPT. 12, 2001, petitioner Flordeliza Maria Reyes-Rayel, a c corporate human resources (CHR) director, was dismissed from the service by respondents
Philippine Luen Thai Holdings Corp. and L&T International Group Philippines, Inc. for loss of confidence in her ability to promote their interests.

She filed a complaint for illegal dismissal, praying for separation pay, 13th month pay, moral and exemplary damages and attorney’s fees.
The petitioner claimed, among others, that her dismissal was effected without the observance of due process since she was not afforded a hearing.
Does this claim find merit?

Ruling: No.

The following are the guiding principles in connection with the hearing requirement in dismissal cases:

(a) ‘ample opportunity to be heard’ means any meaningful opportunity (verbal or written) given to the employee to answer the charges against him and submit
evidence in support of his defense, whether in a hearing, conference or some other fair, just and reasonable way.

(b) a formal hearing or conference becomes mandatory only when requested by the employee in writing or substantial evidentiary disputes exist or a company rule
or practice requires it, or when similar circumstances justify it.

(c) the ‘ample opportunity to be heard’ standard in the Labor Code prevails over the ‘hearing or conference’ requirement in the implementing rules and regulations.

In this case, petitioner’s written response to the Prerequisite Notice provided her with an avenue to explain and defend her side and thus served the purpose of due
process. That there was no hearing, investigation or right to appeal, which petitioner opined to be violation of company policies, is of no moment since the records
are bereft of any showing that there is an existing company policy that requires these procedures with respect to the termination of a CHR Director like petitioner or
that company practice calls for the same. There was also no request for a formal hearing on the part of petitioner. As she was served with a notice apprising her of
the charges against her and also a subsequent notice informing her of the management’s decision to terminate her services after respondents found her written
response to the first notice unsatisfactory, petitioner was clearly afforded her right to due process.
REPUBLIC PLANTERS BANK petitioner, 
vs.
 NATIONAL LABOR RELATIONS COMMISSION and ANTONIO G. SANTOS, respondents.
G.R. No. 117460
January 6, 1997
FACTS:
Private respondent Santos was employed as Department Manager by Republic Planters Bank, now known as PNB-Republic Bank (PNB-RB). Upon retirement, he
filed the instant suit for underpayment of gratuity pay, non-payment of accumulated sick and vacation leaves, mid-year and year-end bonuses, financial assistance,
at the same time claiming damages and attorney’s fees.
The Labor Arbiter found for complainant Santos and this finding was affirmed by the National Labor Relations Commission (NLRC) on appeal. Hence this petition.
Petitioner posits that as the CBA had long expired,it could no longer be used as basis in computing the gratuity pay of its retiring officers; instead, petitioner’s theory
is that that the computation of the benefits of private respondent should be based on the 1982-85 CBA which was the one enforced at the time of his resignation.
The 1982-85 though was for the rank-and-file employees.mPetitioner also invoked the salary structure and criteria for promotion as basis for determining the amount
of gratuity.
ISSUE:
WON a CBA for rank-and-file employees which is the existing CBA upon retirement of an officer, instead of the expired CBA, should be used as basis in computing
the gratuity pay of its retiring officers.
HELD:
No.
Per a decided case: Prior to private respondent’s resignation, there were other managerial employees who resigned and/or retired from petitioner’s employ who
received their corresponding gratuity benefits and the cash value of their accumulated leave credits pursuant to the provisions of the old CBA of 1971-73 despite its
expiration in 1976.
Under Section 14(a), Rule 1 of the Rules and Regulations Implementing Book VI of the Labor Code, it is provided:
Sec. 14. Retirement Benefits. — (a) An employee who is retired pursuant to a bonafide retirement plan or in accordance with the applicable individual or collective
agreement or established employer policy shall be entitled to all the retirement benefits provided therein .

BPI EMPLOYEES UNION-DAVAO CITY-FUBU v. BANK OF PHILIPPINE ISLANDS, GR No. 174912, 2013-07-24
Facts:
A service agreement between BPI and BOMC was initially implemented in BPI's Metro Manila branches. In this agreement, BOMC undertook to provide services
such as check clearing, delivery of bank statements, fund transfers, card production, operations accounting and control,... and cash servicing, conformably with BSP
Circular No. 1388. Not a single BPI employee was displaced and those performing the functions, which were transferred to BOMC, were given other assignments.
On January 1, 1996, the service agreement was likewise implemented in Davao City. Later, a merger between BPI and Far East Bank and Trust Company (FEBTC)
took effect on April 10, 2000 with BPI as the surviving corporation. Thereafter, BPI's cashiering function and FEBTC's... cashiering, distribution and bookkeeping
functions were handled by BOMC. Consequently, twelve (12) former FEBTC employees were transferred to BOMC to complete the latter's service complement.
BPI Davao's rank and file collective bargaining agent, BPI Employees Union-Davao City-FUBU (Union), objected to the transfer of the functions and the twelve (12)
personnel to BOMC contending that the functions rightfully belonged to the BPI employees and that the Union... was deprived of membership of former FEBTC
personnel who, by virtue of the merger, would have formed part of the bargaining unit represented by the Union pursuant to its union shop provision in the CBA.
Issues:
During the LMC, BPI invoked management prerogative stating that the creation of the BOMC was to preserve more jobs and to designate it as an agency to place
employees where they were most needed. On the other hand, the Union charged that BOMC undermined the existence of the... union since it reduced or divided
the bargaining unit. While BOMC employees perform BPI functions, they were beyond the bargaining unit's coverage. In contracting out FEBTC functions to BOMC,
BPI effectively deprived the union of the membership of employees handling said... functions as well as curtailed the right of those employees to join the union.
While the Union admitted that BPI has the prerogative to determine what should be done to meet the exigencies of business in accordance with the case of Sime
Darby Pilipinas,... Inc. v. NLRC,[19] it insisted that the exercise of management prerogative is not absolute, thus, requiring good faith and adherence to the law and
the CBA. Citing the case of Shell Oil Workers' Union v. Shell Company of the Philippines,... Ltd.,[20] the Union claims that it is unfair labor practice for an employer
to outsource the positions in the existing bargaining unit
Ruling:
It is to be emphasized that contracting out of services is not illegal per se. It is an exercise of business judgment or management prerogative. Absent proof that the
management acted in a malicious or arbitrary manner, the Court will not interfere with the exercise of... judgment by an employer
In one case, the Court held that it is management prerogative to farm out any of its activities, regardless of whether such activity is peripheral or core in nature.[44]
What is of primordial importance is that the service agreement does not violate... the employee's right to security of tenure and payment of benefits to which he is
entitled under the law. Furthermore, the outsourcing must not squarely fall under labor-only contracting

Duncan Assoc. of Detailman-PTGWO vs. Glaxo Wellcome Phils., Inc.

G.R. No. 162994, September 17, 2004

FACTS:

Tecson was hired by Glaxo as a medical representative on Oct. 24, 1995. Contract of employment signed by Tecson stipulates, among others, that he agrees to
study and abide by the existing company rules; to disclose to management any existing future relationship by consanguinity or affinity with co-employees or
employees with competing drug companies and should management find that such relationship poses a prossible conflict of interest, to resign from the company.
Company's Code of Employee Conduct provides the same with stipulation that management may transfer the employee to another department in a non-
counterchecking position or preparation for employment outside of the company after 6 months.

Tecson was initially assigned to market Glaxo's products in the Camarines Sur-Camarines Norte area and entered into a romantic relationship with Betsy, an
employee of Astra, Glaxo's competition. Before getting married, Tecson's District Manager reminded him several times of the conflict of interest but marriage took
place in Sept. 1998. In Jan. 1999, Tecson's superiors informed him of conflict of intrest. Tecson asked for time to comply with the condition (that either he or Betsy
resign from their respective positions). Unable to comply with condition, Glaxo transferred Tecson to the Butuan-Surigao City-Agusan del Sur sales area. After his
request against transfer was denied, Tecson brought the matter to Glaxo's Grievance Committee and while pending, he continued to act as medical representative
in the Camarines Sur-Camarines Norte sales area. On Nov. 15, 2000, the National Conciliation and Mediation Board ruled that Glaxo's policy was valid...

ISSUE:

Whether or not the policy of a pharmaceutical company prohibiting its employees from marrying employees of any competitor company is valid

RULING:
On Equal Protection

Glaxo has a right to guard its trade secrets, manufacturing formulas, marketing strategies, and other confidential programs and information from competitors. The
prohibition against pesonal or marital relationships with employees of competitor companies upon Glaxo's employees is reasonable under the circumstances because
relationships of that nature might compromise the interests of the company. That Glaxo possesses the right to protect its economic interest cannot be denied.

It is the settled principle that the commands of the equal protection clause are addressed only to the state or those acting under color of its authority. Corollarily, it
has been held in a long array of US Supreme Court decisions that the equal protection clause erects to shield against merely privately conduct, however,
discriminatory or wrongful.

The company actually enforced the policy after repeated requests to the employee to comply with the policy. Indeed the application of the policy was made in an
impartial and even-handed manner, with due regard for the lot of the employee.

On Constructive Dismissal

Constructive dismissal is defined as a quitting, an involuntary resignation resorted to when continued employment becomes impossible, unreasonable or unlikely;
when there is demotion in rank, or diminution in pay; or when a clear discrimination, insensibility, or disdain by an employer becomes unbearable to the employee.
None of these conditions are present in the instant case

Duncan Association v. Glaxo welcome, G.R. No. 162994, Sept. 17, 2004
Facts:
Petitioner, Pedro Tecson was hired by respondent Glaxo as medical representative, after Tecson had undergone training and orientation. He signed a contract of
employment which stipulates, among others, that he agrees to study and abide by existing company rules. Another stipulation which is also found of Glaxo’s
Employee Code of Conduct provides the duty to disclose to management any existing or future relationship by consanguinity or affinity with co-employees or
employees of competing drug companies and should management find that such relationship poses a possible conflict of interest, to resign from the company.Tecson
was initially assigned to market Glaxo’s products in the Camarines Sur -Camarines Nortesales area. He, subsequently entered into a romantic relationship with
Bettsy, branch coordinator of Astra in Albay, a competitor of Glaxo. She supervised the district managers and medical representatives of her company and prepared
marketing strategies for Astra in that area. The two married even with the several reminders given by the District Manager to Tecson. In January 1999, Tecson’s
superiors informed him that his marriage to Betts y gave rise to a conflict of interest. Despite several reminders and time allowances, Tecson was not able to resolve
the issue on conflicting interest. This situation eventually led to his alleged constructive dismissal. This is a petition for review on certiorari assailing CA’s decision
and resolution.
Issue: Is Glaxo’s policy prohibiting its employees from marrying an employee of a competitor company is valid?
Held: Yes. No reversible error can be ascribed to the Court of Appeals when it ruled that Glaxo’s policy prohibiting an employee from having a relationship with an
employee of a competitor company is a valid exercise of management prerogative. Glaxo has a right to guard its trade secrets, manufacturing formulas, marketing
strategies and other confidential programs and information from competitors, especially so that it and Astra are rival companies in the highly competitive
pharmaceutical industry.The prohibition against personal or marital relationships with employees of competitor companies upon Glaxo’s employees is
reasonable under the circumstances because relationships of that nature might compromise the interests of the company. In laying down the assailed company
policy, Glaxo only aims to protect its interests against the possibility that a competitor company will gain access to its secrets and procedures. That Glaxo possesses
the right to protect its economic interests cannot be denied. No less than the Constitution recognizes the right of enterprises to adopt and enforce such a policy to
protect its right to reasonable returns on investments and to expansion and growth. Indeed, while our laws endeavor to give life to the constitutional policy on social
justice and the protection of labor, it does not mean that every labor dispute will be decided in favor of the workers. The law also recognizes that management has
rights which are also entitled to respect and enforcement in the interest of fair play.

Philippine Telegraph v. National Labor Relations Commission

G.R. No. 118978, 23 May 1997
FACTS:
PT&T (Philippine Telegraph & Telephone Company) initially hired Grace de Guzman specifically as reliever for C.F. Tenorio who went on maternity leave. She was
again invited for employment as replacement of Erlina F. Dizon who went on leave on 2 periods. De Guzman was again asked to join PT&T as a probationary
employee. She indicated in the portion of the job application form under civil status that she was single although she had contracted marriage a few months earlier.
When petitioner learned later about the marriage, its branch supervisor sent de Guzman a memorandum requiring her to explain the discrepancy including a reminder
about the company’s policy of not accepting married women for employment. She was dismissed from the company and Labor Arbiter handed down a decision
declaring that petitioner illegally dismissed de Guzman, who had already gained the status of a regular employee. It was apparent that she had been discriminated
on account of her having contracted marriage in violation of company policies.
ISSUE:
Whether or not the alleged concealment of civil status can be grounds to terminate the services of an employee.
RULING:
No. Private respondent’s act of concealing the true nature of her status from PT&T could not be properly characterized as in bad faith as she was moved to act the
way she did mainly because she wanted to retain a permanent job in a stable company. Thus, could not be a ground to terminate her services.
Article 136 of the Labor Code, one of the protective laws for women, explicitly prohibits discrimination merely by reason of marriage of a female employee. It is
recognized that company is free to regulate manpower and employment from hiring to firing, according to their discretion and best business judgment, except in
those cases of unlawful discrimination or those provided by law.
PT&T’s policy of not accepting or disqualifying from work any woman worker who contracts marriage is afoul of the right against discrimination provided to all women
workers by our labor laws and by our Constitution. The record discloses clearly that de Guzman’s ties with PT&T were dissolved principally because of the company’s
policy that married women are not qualified for employment in the company, and not merely because of her supposed acts of dishonesty.
The policy of PT&T is in derogation of the provisions stated in Art.136 of the Labor Code on the right of a woman to be free from any kind of stipulation against
marriage in connection with her employment and it likewise is contrary to good morals and public policy, depriving a woman of her freedom to choose her status, a
privilege that is inherent in an individual as an intangible and inalienable right. The kind of policy followed by PT&T strikes at the very essence, ideals and purpose
of marriage as an inviolable social institution and ultimately, family as the foundation of the nation. Such policy must be prohibited in all its indirect, disguised or
dissembled forms as discriminatory conduct derogatory of the laws of the land not only for order but also imperatively required. However, SC nevertheless ruled that
Grace did commit an act of dishonesty, which should be sanctioned and therefore agreed with the NLRC’s decision that the dishonesty warranted temporary
suspension of Grace from work.

Star Paper Corp., vs Simbol (2006)G.R. 164774

Facts:
Star Paper Corporation employed Ronaldo Simbol on Oct 1993. He met Alma Dayrit,also an employee of the company, whom he married. Before marriage, Josephine
Ongsitco, the manager advised the couple that one of them must resign if they decided to get married pursuant to a company policy to which Simbol complied. On
February 5, 1997 Comia was hired by the company. She met Howard Comia, a co-employee, whom she married on June1, 2000. Ongsitco likewise reminded them
the company policy, Comia resigned on June 30,2000. Estrella was also hired on July 29, 1994. She met Luisito Zuñiga also a co-worker. Petitioners stated that
Zuñiga, a married man, got Estrella pregnant. The company allegedly could have terminated her services due to immorality but she opted to resign on December21,
1999.
Labor Arbiter dismissed the complaint and states that the company policy was decreed pursuant to what the respondent corporation perceived as management
prerogative. On appeal to the NLRC, the Commission affirmed the decision of the Labor Arbiter. In its assailed Decision dated August 3, 2004, the Court of Appeals
reversed the NLRC decision.
Issue:
Whether or not the questioned policy violates the rights of the employee under the Constitution and the Labor Code?
Held:
The Court ruled on the side of the respondents. Article 136 of the Labor Code which provides:
It shall be unlawful for an employer to require as a condition of employment or continuation of employment that a woman employee shall not get married, or to
stipulate expressly or tacitly that upon getting married a woman employee shall be deemed resigned or separated, or to actually dismiss, discharge, discriminate or
otherwise prejudice a woman employee merely by reason of her marriage.It is significant to note that respondents were hired after they were found fit for the job, but
were asked to resign when they married a co-employee. Petitioners failed to show how the marriage of Simbol to Alma Dayrit could be detrimental to its business
operations. It must be reasonable under the circumstances to qualify as a valid exercise of management prerogative.The questioned policy may not facially violate
Article 136 of the Labor Code but it creates a disproportionate effect. The failure of petitioners to prove a legitimate business concern in imposing the questioned
policy cannot prejudice the employee’s right to be free from arbitrary discrimination based upon stereotypes of married persons working together in one company.

[G.R. No. 145443. March 18, 2005]

RAQUEL P. CONSULTA, petitioner, vs. COURT OF APPEALS, PAMANAPHILIPPINES, INC., RAZUL Z. REQUESTO, and ALETA TOLENTINO, respondents.
FACTS:
Consulta was Managing Associate of Pamana. On 1987 she was issued a certification authorizing her to negotiate for and in behalf of PAMANA with the Federation
of Filipino Civilian Employees Association. Consulta was able to secure an account with FFCEA in behalf of PAMANA. However, Consulta claimed that PAMANA
did not pay her commission for the PPCEA account and filed a complaint for unpaid wages or commission.
ISSUE:
Whether or not Consulta was an employee of PAMANA.
HELD:
The SC held that Pamana was an independent agent and not an employee. The power of control in the four fold test is missing. The manner in which Consulta was
to pursue her tasked activities was not subject to the control of PAMANA. Consulta failed to show that she worked definite hours. The amount of time, the methods
and means, the management and maintenance of her sales division were left to her sound judgment. Finally, Pamana paid Consulta not for labor she performed but
only for the results of her labor. Without results, Consulta’s labor was her own burden and loss. Her right to compensation, or to commission, depended on the
tangible results of her work -whether she brought in paying recruits. The fact that the appointment required Consulta to solicit business exclusively for Pamana did
not mean Pamana exercised control over the means and methods of Consulta’s work as the term control is understood in labor jurisprudence. Neither did it make
Consulta an employee of Pamana. Pamana did not prohibit Consulta from engaging in any other business, or from being connected with any other company, for as
long as the business or company did not compete with Pamana’s business. The exclusivity clause was a reasonable restriction to prevent similar acts prejudicial to
Pamana’s business interest. Article 1306 of the Civil Code provides that “[t]he contracting parties may establish such stipulation, clauses, terms and conditions as
they may deem convenient, provided that they are not contrary to law, morals, good customs, public order, or public policy.There being no employer-employee
relationship between Pamana and Consulta, the Labor Arbiter and the NLRC had no jurisdiction to entertain and rule on Consulta’s money claim. Consulta’s remedy
is to file an ordinary civil action to litigate her claim. Petition is dismissed.

TIU vs. PLATINUM PLANS PHILIPPINES

G.R. No. 163512, February 28, 2007
FACTS: Respondent Platinum Plans Philippines, Inc. is a domestic corporation engaged in the pre-need industry. From 1987 to 1989, petitioner Daisy B. Tiu was
its Division Marketing Director. On January 1, 1993, respondent re-hired petitioner as Senior Assistant Vice-President and Territorial Operations Head in charge of
its Hong Kong and Asean operations. The parties executed a contract of employment valid for five years.

On September 16, 1995, petitioner stopped reporting for work. In November 1995, she became the Vice-President for Sales of Professional Pension Plans, Inc., a
corporation engaged also in the pre-need industry.

Consequently, respondent sued petitioner for damages before the RTC of Pasig City, Branch 261. Respondent alleged, among others, that petitioner’s employment
with Professional Pension Plans, Inc. violated the non-involvement clause in her contract of employment. In upholding the validity of the non-involvement clause, the
trial court ruled that a contract in restraint of trade is valid provided that there is a limitation upon either time or place. In the case of the pre-need industry, the trial
court found the two-year restriction to be valid and reasonable. On appeal, the Court of Appeals affirmed the trial court’s ruling. It reasoned that petitioner entered
into the contract on her own will and volition. Thus, she bound herself to fulfill not only what was expressly stipulated in the contract, but also all its consequences
that were not against good faith, usage, and law. The appellate court also ruled that the stipulation prohibiting non-employment for two years was valid and
enforceable considering the nature of respondent’s business.

ISSUE: Whether the Court of Appeals erred in sustaining the validity of the non-involvement clause

HELD: In this case, the non-involvement clause has a time limit: two years from the time petitioner’s employment with respondent ends. It is also limited as to trade,
since it only prohibits petitioner from engaging in any pre-need business akin to respondent’s. More significantly, since petitioner was the Senior Assistant Vice-
President and Territorial Operations Head in charge of respondent’s Hongkong and Asean operations, she had been privy to confidential and highly sensitive
marketing strategies of respondent’s business. To allow her to engage in a rival business soon after she leaves would make respondent’s trade secrets vulnerable
especially in a highly competitive marketing environment. In sum, The Court finds the non-involvement clause not contrary to public welfare and not greater than is
necessary to afford a fair and reasonable protection to respondent. Hence the restraint is valid and such stipulation prevails.

ARMANDO G. YRASUEGUI, petitioners, vs.

PHILIPPINE AIRLINES, INC., respondents.
G.R. No. 168081, October 17, 2008 (569 SCRA 467)

VERSION 1:
FACTS: THIS case portrays the peculiar story of an international flight steward who was dismissed because of his failure to adhere to the weight standards of the
airline company.
The proper weight for a man of his height and body structure is from 147 to 166 pounds, the ideal weight being 166 pounds, as mandated by the Cabin and Crew
Administration Manual of PAL.
In 1984, the weight problem started, which prompted PAL to send him to an extended vacation until November 1985. He was allowed to return to work once he lost
all the excess weight. But the problem recurred. He again went on leave without pay from October 17, 1988 to February 1989.
Despite the lapse of a ninety-day period given him to reach his ideal weight, petitioner remained overweight. On January 3, 1990, he was informed of the PAL
decision for him to remain grounded until such time that he satisfactorily complies with the weight standards. Again, he was directed to report every two weeks for
weight checks, which he failed to comply with.
On April 17, 1990, petitioner was formally warned that a repeated refusal to report for weight check would be dealt with accordingly. He was given another set of
weight check dates, which he did not report to.
On November 13, 1992, PAL finally served petitioner a Notice of Administrative Charge for violation of company standards on weight requirements. Petitioner insists
that he is being discriminated as those similarly situated were not treated the same.
On June 15, 1993, petitioner was formally informed by PAL that due to his inability to attain his ideal weight, “and considering the utmost leniency” extended to him
“which spanned a period covering a total of almost five (5) years,” his services were considered terminated “effective immediately.”
LABOR ARBITER: held that the weight standards of PAL are reasonable in view of the nature of the job of petitioner. However, the weight standards need not be
complied with under pain of dismissal since his weight did not hamper the performance of his duties.
NLRC affirmed.
CA: the weight standards of PAL are reasonable. Thus, petitioner was legally dismissed because he repeatedly failed to meet the prescribed weight standards. It is
obvious that the issue of discrimination was only invoked by petitioner for purposes of escaping the result of his dismissal for being overweight.
ISSUE: WON he was validly dismissed.
HELD: YES
A reading of the weight standards of PAL would lead to no other conclusion than that they constitute a continuing qualification of an employee in order to keep the
job. The dismissal of the employee would thus fall under Article 282(e) of the Labor Code.
In the case at bar, the evidence on record militates against petitioner’s claims that obesity is a disease. That he was able to reduce his weight from 1984 to 1992
clearly shows that it is possible for him to lose weight given the proper attitude, determination, and self-discipline. Indeed, during the clarificatory hearing on December
8, 1992, petitioner himself claimed that “[t]he issue is could I bring my weight down to ideal weight which is 172, then the answer is yes. I can do it now.”
Petitioner has only himself to blame. He could have easily availed the assistance of the company physician, per the advice of PAL.
In fine, We hold that the obesity of petitioner, when placed in the context of his work as flight attendant, becomes an analogous cause under Article 282(e) of the
Labor Code that justifies his dismissal from the service. His obesity may not be unintended, but is nonetheless voluntary. As the CA correctly puts it, “[v]oluntariness
basically means that the just cause is solely attributable to the employee without any external force influencing or controlling his actions. This element runs through
all just causes under Article 282, whether they be in the nature of a wrongful action or omission. Gross and habitual neglect, a recognized just cause, is considered
voluntary although it lacks the element of intent found in Article 282(a), (c), and (d).”
NOTES:
The dismissal of petitioner can be predicated on the bona fide occupational qualification defense. Employment in particular jobs may not be limited to persons of a
particular sex, religion, or national origin unless the employer can show that sex, religion, or national origin is an actual qualification for performing the job. The
qualification is called a bona fide occupational qualification (BFOQ). In short, the test of reasonableness of the company policy is used because it is parallel to BFOQ.
BFOQ is valid “provided it reflects an inherent quality reasonably necessary for satisfactory job performance.”
The business of PAL is air transportation. As such, it has committed itself to safely transport its passengers. In order to achieve this, it must necessarily rely on its
employees, most particularly the cabin flight deck crew who are on board the aircraft. The weight standards of PAL should be viewed as imposing strict norms of
discipline upon its employees.
The primary objective of PAL in the imposition of the weight standards for cabin crew is flight safety.
Separation pay, however, should be awarded in favor of the employee as an act of social justice or based on equity. This is so because his dismissal is not for
serious misconduct. Neither is it reflective of his moral character.
VERSION 2:
Facts: Complainant was an international flight steward who was dismissed because of his failure to adhere to the weight standards of the company.
Issue: Was the dismissal valid?
Held: SC upheld the legality of dismissal. Separation pay, however, should be awarded in favor of the employee as an act of social justice or based on equity. This
is so because his dismissal is not for serious misconduct. Neither is it reflective of his moral character.
The obesity of petitioner, when placed in the context of his work as flight attendant, becomes an analogous cause under Article 282(e) of the Labor Code. His obesity
may not be unintended, but is nonetheless voluntary. “[V]oluntariness basically means that the just cause is solely attributable to the employee without any external
force influencing or controlling his actions. This element runs through all just causes under Article 282, whether they be in the nature of a wrongful action or omission.
Gross and habitual neglect, a recognized just cause, is considered voluntary although it lacks the element of intent found in Article 282(a), (c), and (d).”
Employment in particular jobs may not be limited to persons of a particular sex, religion, or national origin unless the employer can show that sex, religion, or national
origin is an actual qualification for performing the job.

Bona fide occupational qualification (BFOQ)

The Constitution, the Labor Code, and RA No. 7277 or the Magna Carta for Disabled Persons contain provisions similar to BFOQ.

Argument that BFOQ is a statutory defense must fail

Meiorin Test (US jurisprudence) in determining whether an employment policy is justified:
(1) the employer must show that it adopted the standard for a purpose rationally connected to the performance of the job;
2) the employer must establish that the standard is reasonably necessary to the accomplishment of that work-related purpose; and
(3) the employer must establish that the standard is reasonably necessary in order to accomplish the legitimate work-related purpose.

In Star Paper Corporation v. Simbol, this Court held that in order to justify a BFOQ, the employer must prove:
(1) the employment qualification is reasonably related to the essential operation of the job involved; and
(2) that there is factual basis for believing that all or substantially all persons meeting the qualification would be unable to properly perform the duties of the job.
In short, the test of reasonableness of the company policy is used because it is parallel to BFOQ. BFOQ is valid “provided it reflects an inherent quality reasonably
necessary for satisfactory job performance.”
The weight standards of PAL are reasonable. A common carrier, from the nature of its business and for reasons of public policy, is bound to observe extraordinary
diligence for the safety of the passengers it transports.
The primary objective of PAL in the imposition of the weight standards for cabin crew is flight safety. It cannot be gainsaid that cabin attendants must maintain agility
at all times in order to inspire passenger confidence on their ability to care for the passengers when something goes wrong.
Exceptionally, separation pay is granted to a legally dismissed employee as an act “social justice,” or based on “equity.” Provided the dismissal:
Entitled to separation pay, even if terminated for just cause
(1) was not for serious misconduct; and
(2) does not reflect on the moral character of the employee.
Thus, he was granted separation pay equivalent to one-half (1/2) month’s pay for every year of service.