Case Digest: Roche Philippines v. NLRC, G.R. No. 83335 October 5, 1989

 Labor Law | Appeal 

• Reynaldo J. Villareal, a medical representative, worked for the Roche Philippines in the Dumaguete/Bohol area.
• His duties included conducting sales calls on physicians, providing drug samples to create promotional impact for Roche products.
• Due to the nature of the work, the company couldn't monitor work hours through the bundy clock system. A method was devised for employees to fill daily call reports, indicating names of visited physicians and drug samples issued.
• Jerry Losbanes, a supervisor, accused Villareal of "kiting" based on a report by Johnny de la Cruz, alleging Villareal was in Cebu City when he should be in Dumaguete as per his report.
• Villareal denied the charges, submitted evidence, and requested an investigation but was suspended and later dismissed without a hearing.
• Villareal sought to present his side, but the company refused to speak with him, dismissed him, and asked for the return of company assets.
• The company requested Villareal to sign a letter-quitclaim for a certificate of employment, accompanied by checks claiming settlement.
• Villareal rejected the offer and filed a complaint with the National Labor Relations Commission, including a claim for 50% of savings from his cost-saving proposal during the first 12 months of the implementation.
• Labor Arbiter: Found the company guilty of illegal dismissal and ordered payment for unpaid salaries, backwages, 13th-month pay, benefits, allowances, retirement benefits, and damages amounting to P155,000.00.
• NLRC: Affirmed with modifications, ordering reinstatement, back wages, retirement benefits, 50% of savings or P500,000.00, moral and exemplary damages, and attorney's fees.

WoN the NLRC acted without or in excess of jurisdiction and/or committed grave abuse of discretion amounting to lack of jurisdiction in granting Villareal additional reliefs, even if the latter did not appeal from the decision of the Arbiter. NO

This Court finds the petition bereft of merit.

Petitioners insist that they have gathered sufficient evidence to dismiss Villareal for "kiting" through falsification of his Daily Call Report. To bolster this allegation they presented the testimony of Johnny de la Cruz who had allegedly seen Villareal in Cebu City at around 4:30 p.m. of September 9,1982. He averred that Villareal greeted him with the following statement: "Sir, I'm coming in from Dumaguete City. I am not supposed to be officially in yet. Sir, don't tell them that you saw me." Suspecting that something was irregular, de la Cruz allegedly checked the Daily Call Report filed by Villareal for the said date and discovered that the latter reported that he was in Dumaguete at that time. These circumstances, according to petitioners, clearly justify the termination of Villareal from employment because of "kiting."

This Court finds the above-mentioned testimony doubtful.

First, it is unlikely that Villareal, upon seeing an executive of the company, would go out of his way to confess his misdeed especially to one he hardly knows, having met the latter only once. This kind of behavior runs contrary to ordinary experience. If it was true that Villareal was in Cebu City on that day, it would have been more natural for him to take all precautions to avoid being seen by anyone from the company. Or if he was actually seen he would have kept mum about his infraction of the rules.

Secondly, it cannot be denied that Roche (Phil.) is a big organization. It employs a great number of medical representatives to promote its products. Thus, it appears improbable that De la Cruz would have been able to identify Villareal when the latter was not even under his direct supervision. He met him only once and casually.

Lastly, assuming Villareal was seen in Cebu City at the time and he informed de la Cruz that he just arrived from Dumaguete, if so then he was not "kiting." His violation, if at all, is that he returned too soon.

In denying that they have deprived the right of Villareal to due process, the petitioners pointed out that he was informed of the charges against him and he was given the opportunity to explain his side. Citing Associated Citizen's Bank vs. Ople,  the petitioners attempted to substantiate their argument by mentioning that this Court had previously done away with the holding of a hearing in order to comply with the constitutional requirement of due process.

However, the circumstances obtaining in the above-cited case bears no resemblance to the case at bar. The former contemplates a situation where the employee admits his guilt and all his admissions are corroborated by documentary evidence. Such is not the case in the present controversy where Villareal never admitted the commission of the offense he was being charged of. The records do not indubitably show that Villareal was actually in Cebu City on that day. A hearing was, therefore, necessary to thresh out all doubts as to the conflicting allegations of De la Cruz and Villareal. The failure of petitioner to give private respondent the benefit of a hearing and an investigation before his termination constitutes an infringement of his constitutional right to due process of law. 

Petitioners next assail the legality of the order of reinstatement made by the respondent commission by citing San Miguel Corporation vs. NLRC where this Court found that reinstatement was improper whenever the termination of an employee was due to breach of trust and confidence. Quoting certain passages from the decision of this Court in the subsequent case of Wenphil Corporation vs. NLRC and Mallare, petitioners tried to buttress this line of reasoning by stating that the termination of an employee was proper since "it would be highly prejudicial to the interests of the employer to impose on him the services of an employee who has been shown to be guilty of the charges that warranted his dismissal from employment." 

Again, an examination of the facts in the above cited cases shows that these two cases bear no resemblance to the case at bar. In Wenphil, the employee was dismissed for his insubordination since he had flagrantly violated company policy by engaging in a brawl with another employee within the company premises. Likewise, in San Miguel Corporation, the employee was dismissed for having misappropriated company funds. The said funds were disbursed by the company to be used in posting bail for the said employee when the latter was criminally charged with damage to property through reckless imprudence. Upon the dismissal of the case, the employee deposited the cash bond in his account instead of returning the said amount to the company. No reasonable explanation was given by him when confronted by his superiors. Considering the gravity of the offenses, taken together with the evidence presented against the said employees, this Court found their dismissal to be proper.

But such is not the case with Villareal wherein the very credibility of the only witness against him is put in issue. Furthermore, Villareal had served the company for fourteen years with nary a complaint from his superiors such that an offense like "kiting" would not have merited such a drastic punishment as dismissal; that is, if he were really guilty of the said offense. Hence, the failure of the petitioner to prove such fact "necessarily means that the dismissal is not justified, and, therefore, the employee is entitled to be reinstated in accordance with the mandate of Article 280 of the New Labor Code." 14 Subsequent pronouncements of this Court reiterate this doctrine. For instance, in Dabuet vs. Roche Pharmaceuticals, 15 this Court held that reinstatement must follow as a matter of right whenever the management has been found guilty of illegal dismissal.

Having established the impropriety of the dismissal of Villareal thus requiring his consequent reinstatement, the question as to his entitlement to retirement benefits arises.

The collective bargaining agreement entered into between the management and the union provides for an optional retirement program for employees who have been with the company for fifteen (15) consecutive years. The company undertook to pay the basic pay for one month multiplied by the number of years the employee has served the company for the first 15 years and a month and a half's basic salary for every year for the subsequent years.

The provisions of the collective bargaining agreement must be respected since its terms and conditions "constitute the law between the parties." Those who are entitled to its benefits can invoke its provisions. In the event that an obligation therein imposed is not fulfilled, the aggrieved party has the right to go to court for redress.

The next issue is whether or not Villareal is entitled to be paid the cost saving bonus of 50% of the amount saved by the company for the year that his proposal was implemented. This time the Court resolves the issue in the negative.

Petitioners allege that the inter-office memorandum upon which Villareal bases his claim was not in effect when the latter submitted his proposal. Petitioners also ask why Villareal tarried for such a long time before filing the said claim if he honestly believed that he was entitled to the same. Petitioners further aver that even if Villareal was legally entitled to the said bonus, prescription has set in under Article 291 of the Labor Code. The aforementioned article provides that "all money claims arising from employer-employee relations accruing during the effectivity of this Code shall be filed within three (3) years from the time the cause of action accrued, otherwise, they shall be forever barred."

This Court cannot allow Villareal to recover said claim at this late time. He should have filed his claim against Roche the moment his cause of action accrued instead of waiting for five years before doing so. He had, therefore, slept on his rights and should not be rewarded for his own negligence. On this aspect, the Court must hold for the petitioners.

Petitioners then suggest that the respondent Commission abused its discretion in awarding reliefs in excess of those stated in the decision of the labor arbiter despite the absence of an appeal by Villareal. To stress this point, they cited Section 5(c) of the Rules of Procedure of the National Labor Relations Commission which provides that the Commission shall, in cases of perfected appeals, limit itself to reviewing those issues which were raised on appeal. Consequently, those which were not raised on appeal shall be final and executory.

There is no merit in this contention. The records show that the petitioners elevated the issues regarding the correctness of the award of damages, reinstatement with backpay, retirement benefits and the cost-saving bonus to the respondent Commission in their appeal. This opened the said issues for review and any action taken thereon by the Commission was well within the parameters of its jurisdiction.

With regard to the propriety of the award of moral damages, this Court, in a long line of cases, has consistently granted the lowly workingman the right to recover damages for unjust dismissals tainted with bad faith. In the instant petition, the motive of the company in dismissing Villareal was far from noble as borne by the circumstances surrounding such dismissal.

Petitioners must have known that Villareal, who had been their employee for fourteen (14) years, had only one year to serve before he could avail of the benefits of the optional retirement plan stipulated in the collective bargaining agreement. Consequently, the latter would be receiving a considerable sum of money from the company and the only way they could avoid this obligation was to find a reason, no matter how flimsy, to terminate the employment of Villareal. Conveniently, indeed, petitioners discovered that Villareal was "kiting" and outrightly dismissed him on the basis of the unsubstantiated allegations of one person. Their bad faith was made more apparent by their refusal to conduct a formal investigation to give Villareal an opportunity to traverse the charges against him. The judgment of the respondent Commission regarding the award of damages plus ten percent (10%) of the entire monetary award must, therefore, be sustained.

Lastly, the backwages awarded to Villareal should not exceed three (3) years.

WHEREFORE, with the modification eliminating the award for cost saving bonus and that the backwages should not exceed three (3) years, the decision of the respondent NLRC is affirmed in all other respects, with costs against petitioners.

SO ORDERED.