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  Abella vs. NLRC G.R. No. 71813 July 20, 1987 EN BANC: PARAS (J), 13 CONCUR Facts:  Ricardo Dionele, Sr. (private respondent) has been a regular farm worker since 1949 in Hacienda Danao-Ramona located in Ponteverde, Negros Occidential. Said farm land was leased to Rosalina Abella (petitioner) for a period of ten (10) years, renewable for another ten years. Upon the expiration of her leasehold rights, petitioner dismissed Ricardo and another co-employee. Private respondents filed a complaint against the petitioner at the Ministry of Labor and Employment for overtime pay, illegal dismissal and reinstatement with backwages. After presenting their respective evidence, the Labor Arbiter ruled that the dismissal is warranted by the cessation of business, but granted the private respondents’ separation pay. Petitioner filed a motion for reconsideration but the same was denied. Hence, the present petition. Issue:  Whether or not private respondents are entitled to separation pay. Held:  The petition is devoid of merit.  Article 284 of the Labor code provides that “ the employer may also terminate the employment of any employee due to the installation of labor-saving devices, redundancy, retrenchment to prevent losses or the closing or cessation of operation of the establishment or undertaking unless the closing is for the purpose of circumventing the provisions of this title, by serving a written notice on the workers and the Ministry of Labor and Employment at least month before the intended date thereof. In case of termination due to the installation of labor-saving devices or redundancy, the worker affected thereby shall be entitled to a separation pay equivalent to at least his one month pay or to at least one month pay for every year of service, whichever is higher. In case of retrenchment to prevent losses and in cases of closure or cessation of operations of establishment or undertaking not due to serious business losses or financial reverses, the separation pay shall be equivalent to one month pay or at least one-half month  pay for every year of service whichever is higher. A fraction of at least six months shall be considered one whole year. The purpose of the said article is obvious: the protection of the workers whose employment is terminated because of the closure of establishment and reduction of personnel. Without said law, employees like private respondents in the case at bar will lose the benefits to which they are entitled for the number of years served. Although they were absorbed by the new management of the hacienda, in the absence of any showing that the latter has assumed the responsibilities of the former employer, they will be considered as new employees and the years of service behind them would amount to nothing. In any event, it is well-settled that in the implementation and interpretation of the provisions of the Labor Code and its implementing regulations, the workingman’s welfare should be the primordial and paramount consideration. Decision: The instant petition is hereby dismissed and the decision of the Labor Arbiter and the Resolution of the Ministry of Labor and Employment are hereby affirmed. Mendoza vs. Rural Bank of Lucban G.R. No. 155421 July 7, 2004 FIRST DIVISION: PANGANIBAN, J.: Facts: On April 25, 1999, the Board of Directors of the Rural Bank of Lucban, Inc., issued Board Resolution Nos. 99-52 and 99-53, providing that “in line with the policy of the bank to familiarize bank employees with the various phases of bank operations and further strengthen the existing internal control system, all officers and employees are subject to reshuffle of assignments” and that those” affected branch employees are reshuffled to their new assignments without changes in their compensation and other benefits.” On May 3, 1999, in an undated letter addressed to Daya, the Bank’s Board Chairman, petitioner Elmer Mendoza expressed his opinion on the reshuffle alleging that his reshuffling is deemed to be a demotion without any legal basis and thus asking to be allowed to remain in his position. On May 10, 1999, Daya replied reitirating that “it was never the intention (of the management) to downgrade his position in the bank considering that due compensation is maintained and no future reduction was intended. It was further reiterated that the “conduct of reshuffle is also a prerogative of bank management. . On June 7, 1999, petitioner submitted to the bank's Tayabas branch manager a letter in which he applied for a leave of absence from work. On June 21, 1999, petitioner again submitted a letter asking for another leave of absence for twenty days effective on the same date. On June 24, 1999, while on his second leave of absence, petitioner filed a Complaint before Arbitration Branch No. IV of the National Labor Relations Commission (NLRC). The Complaint -- for illegal dismissal, underpayment, separation pay and damages -- was filed against the Rural Bank of Lucban and/or its president, Alejo B. Daya; and its Tayabas branch manager, Briccio V. Cada. The case was docketed as  NLRC Case SRAB-IV-6-5862-99-Q.The labor arbiter's June 14, 2000 Decision upheld petitioner's claims. On appeal, the NLRC reversed the labor arbiter. In its July 18, 2001 Resolution. After the NLRC denied his Motion for Reconsideration, petitioner brought before the CA a Petition for Certiorari assailing the foregoing Resolution. Finding that no grave abuse of discretion could be attributed to the NLRC, the CA Decision ruled in favor of the private respondent rural bank. Issue: Whether or not the the petitioner was constructively dismissed from employment and that the reshuffling pursuant to Board Res. Nos. 99-52 and 99-53 is a valid exercise of management prerogative. Held: The Petition has no merit. Constructive dismissal is defined as an involuntary resignation resorted to when continued employment is rendered impossible, unreasonable or unlikely; when there is a demotion in rank or a diminution of pay; or when a clear discrimination, insensibility or disdain by an employer becomes unbearable to the employee. Jurisprudence recognizes the exercise of management prerogatives. For this reason, courts often decline to interfere in legitimate business decisions of employers. Indeed, labor laws discourage interference in employers' judgments concerning the conduct of their business. The law must protect not only the welfare of employees, but also the right of employers. In the pursuit of its legitimate business interest, management has the prerogative to transfer or assign employees from one office or area of operation to another -- provided there is no demotion in rank or diminution of salary, benefits, and other privileges; and the action is not motivated by discrimination, made in bad faith, or effected as a form of punishment or demotion without sufficient cause. This privilege is inherent in the right of employers to control and manage their enterprise effectively. The right of employees to security of tenure does not give them vested rights to their positions to the extent of depriving management of its prerogative to change their assignments or to transfer them. Managerial prerogatives, however, are subject to limitations provided by law, collective bargaining agreements, and general principles of fair play and  justice. Decision: WHEREFORE, this Petition is DENIED, and the June 14, 2002 Decision and the September 25, 2002 Resolution of the Court of Appeals are AFFIRMED. Costs against petitioner. SO ORDERED. Gelmart Industries Phils., Inc. vs. NLRC G.R. No. 85668 August 10, 1989 FIRST DIVISION: GANCAYCO, J.: Facts: Private respondent Felix Francis started working as an auto-mechanic for petitioner Gelmart Industries Phils., Inc. (GELMART) sometime in 1971. As such, his work consisted of the repair of engines and underchassis, as well as trouble shooting and overhauling of company vehicles. He is likewise entrusted with some tools and spare parts in furtherance of the work assigned to him. On April 11, 1987, private respondent was caught by the security guards taking out of GELMART's premises one (1) plastic container filled with about 16 ounces of used' motor oil, without the necessary gate pass to cover the same as required under GELMART's rules and regulations which provides that theft and/or pilferage of company property merits an outright termination from employment. By reason thereof, petitioner was placed under preventive suspension pending investigation for violation of company rules and regulations on April 13, 1987.  After due investigation, or on May 20, 1987, private respondent was found guilty of theft of company property. As a consequence, his services were severed. Thereafter, private respondent filed a complaint for illegal dismissal before the NLRC. In a decision dated February 26, 1988, Labor Arbiter Ceferina J. Diosana ruled that private respondent was illegally dismissed and, accordingly, ordered the latter's reinstatement with full backwages from April 13, 1987 up to the time of actual reinstatement. From this decision, GELMART interposed an appeal with the NLRC. In its decision dated October 21, 1988, the NLRC affirmed with modification the ruling of Labor  Arbiter Diosana. On December 12, 1988, GELMART filed before this Court a special civil action for certiorari with a prayer for the issuance of a temporary restraining order. On January 18, 1989, this Court, without necessarily giving due course to the petition, issued a temporary restraining order enjoining respondents from enforcing the assailed decision. Issue: Whether or not the NLRC committed a grave abuse of discretion for rendering a decision that is contrary to law  and existing jurisprudence in ordering the reinstatement of private respondent to his former position with payment of backwages. Held: We find no merit in this petition. Consistent with the policy of the State to bridge the gap between the underprivileged workingmen and the more affluent employers, the NLRC rightfully tilted the balance in favor of the workingmen — and this was done without being blind to the concomitant right of the employer to the protection of his property. On the other hand, without being too harsh to the employer, and naively liberal to labor, on the other, the NLRC correctly pointed out that private respondent cannot totally escape liability for what is patently a violation of company rules and regulations. To reiterate, be it of big or small commercial value, intended to be re-used or altogether disposed of or wasted, the used motor oil still remains, in legal contemplation, the property of GELMART. As such, to take the same out of GELMART's premises without the corresponding gate pass is a violation of the company rule on theft and/or pilferage of company property. In this score, it is very difficult for this Court to discern grave abuse of discretion on the part of the NLRC in modifying the appealed decision. The suspension imposed upon private respondent is a sufficient penalty for the misdemeanor committed. Considering that private respondent herein has no previous derogatory record in his fifteen (15) years of service with petitioner GELMART the value of the property pilfered (16 ounces of used motor oil) is very minimal, plus the fact that petitioner failed to reasonably establish that non-dismissal of private respondent would work undue prejudice to the viability of their operation or is patently inimical to the company's interest, it is more in consonance with the policy of the State, as embodied in the Constitution, to resolve all doubts in favor of labor. Thus, the penalty of preventive suspension was sufficient punishment for the violation under the circumstance and that complainant-appellee’s dismissal unwarranted. Decision: WHEREFORE, in view of the foregoing, the petition is DISMISSED for lack of merit. The, restraining order issued by this Court on January 18, 1989 enjoining the enforcement of the questioned decision of the National Labor Relations Commission is hereby lifted. No pronouncement as to costs. SO ORDERED.  Pampanga Bus Company, INC., vs. PAMBUSCO Employees' Union, Inc. G.R. No. 46739 September 23, 1939 EN BANC: MORAN, J.: Facts: On May 31, 1939, the Court of Industrial Relations issued an order, directing the petitioner herein, Pampanga Bus Company, Inc., to recruit from the respondent, Pambusco Employees' Union, Inc., new employees or laborers it may need to replace members of the union who may be dismissed from the service of the company, with the proviso that, if the union fails to provide employees possessing the necessary qualifications, the company may employ any other persons it may desire. This order, in substance and in effect, compels the company, against its will, to employ preferentially, in its service, the members of the union. Issue: Whether or not the said order issued by the CIR valid and not violative of the right of the employer to select employees. Held: We hold that the court has no authority to issue such compulsory order. The general right to make a contract in relation to one's business is an essential part of the liberty of the citizens protected by the due-process clause of the Constitution. The right of the laborer to sell his labor to such person as he may choose is, in its essence, the same as the right of an employer to purchase labor from any person whom it chooses. The employer and the employee have thus an equality of right guaranteed by the Constitution. Section of Commonwealth Act No. 213 confers upon labor organizations the right to collective bargaining with employers for the purpose of seeking better working and living conditions, fair wages, and shorter working hours for laborers, and, in general, to promote the material, social and moral well-being of their members. This provision in granting to labor unions merely the right of collective bargaining, impliedly recognizes the employer's liberty to enter or not into collective agreements with them. Indeed, we know of no provision of the law compelling such agreements. Such a fundamental curtailment of freedom, if ever intended by law upon grounds of public policy, should be effected in a manner that is beyond all possibility of doubt. The supreme mandates of the Constitution should not be loosely brushed aside. As held by the Supreme Court of the United States in Hitchman Coal & Co. vs. Mitchell (245 U. S., 229; 62 Law. ed., 260, 276): Decision: Thus considered, the order appealed from is hereby reversed, with costs against the respondent Pambusco Employees' Union, Inc.
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