Coca-Cola v. Gacayan (G.R. No. 149433; December 15, 2010)
CASE DIGEST: THE COCA-COLA EXPORT CORPORATION, Petitioner, v. CLARITA P. GACAYAN, Respondent. Coca-Cola v. Gacayan (G.R. No. 149433; December 15, 2010).
FACTS: Clarita P. Gacayan began working with petitioner on October 8, 1985. At the time her employment was terminated on April 6, 1995, for alleged loss of trust and confidence, respondent was holding the position of Senior Financial Accountant. Under petitioners company policy, one of the benefits enjoyed by its employees was the reimbursement of meal and transportation expenses incurred while rendering overtime work. It was in connection with this company policy that petitioner called the attention of respondent and required her to explain the alleged alterations in three receipts which she submitted to support her claim for reimbursement of meal expenses.
On January 3, 1995, Coca Cola sent respondent a letter directing her to explain why she should not be subjected to disciplinary sanctions for violating Section II, No. 15, paragraph (d) of the companys rules and regulations which punishes with dismissal the submission of any fraudulent item of expense. To which Gacayan responded that she had no knowledge of the alteration. After the investigation and hearing, Gacayan was dismissed.
Gacayan then filed a case for illegal dismissal wherein the LA ruled that the dismissal was for a valid cause. This was upheld by the NLRC on appeal. The CA then reversed the NLRCs decision and further ruled that the penalty of dismissal imposed on respondent was too harsh and further directed petitioner to immediately reinstate respondent to her former position, if possible, or a substantially equivalent position without loss of seniority rights and with full backwages.
ISSUE: Did the CA err by being liberal and decided a question of substance not in accord with law?
HELD: In termination cases, the burden of proof rests on the employer to show that the dismissal was for just cause. Otherwise, an employee who is illegally dismissed "shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages, inclusive of allowances, and to his other benefits or their monetary equivalent computed from the time his compensation was withheld from him up to the time of his actual reinstatement."
The Labor Code mandates that before an employer may validly dismiss an employee from the service, the requirement of substantial and procedural due process must be complied with. Under the requirement of substantial due process, the grounds for termination of employment must be based on just or authorized causes.
The SC finds that Gacayan's dismissal from employment was not grounded on any of the just causes enumerated under Article 282 of the Labor Code. At the outset, it is important to note that the term "trust and confidence" is restricted to managerial employees. In the instant case, the basis for terminating the employment of respondent was for gross violation of the company's rules and regulations. However, no mention was made regarding petitioners alleged loss of trust and confidence in respondent. Neither was there any explanation nor discussion of the alleged sensitive and delicate position of respondent requiring the utmost trust of petitioner.
It bears emphasizing that the right of an employer to dismiss its employees on the ground of loss of trust and confidence must not be exercised arbitrarily. For loss of trust and confidence to be a valid ground for dismissal, it must be substantial and founded on clearly established facts. Loss of confidence must not be used as a subterfuge for causes which are improper, illegal or unjustified; it must be genuine, not a mere afterthought, to justify earlier action taken in bad faith.
FACTS: Clarita P. Gacayan began working with petitioner on October 8, 1985. At the time her employment was terminated on April 6, 1995, for alleged loss of trust and confidence, respondent was holding the position of Senior Financial Accountant. Under petitioners company policy, one of the benefits enjoyed by its employees was the reimbursement of meal and transportation expenses incurred while rendering overtime work. It was in connection with this company policy that petitioner called the attention of respondent and required her to explain the alleged alterations in three receipts which she submitted to support her claim for reimbursement of meal expenses.
On January 3, 1995, Coca Cola sent respondent a letter directing her to explain why she should not be subjected to disciplinary sanctions for violating Section II, No. 15, paragraph (d) of the companys rules and regulations which punishes with dismissal the submission of any fraudulent item of expense. To which Gacayan responded that she had no knowledge of the alteration. After the investigation and hearing, Gacayan was dismissed.
Gacayan then filed a case for illegal dismissal wherein the LA ruled that the dismissal was for a valid cause. This was upheld by the NLRC on appeal. The CA then reversed the NLRCs decision and further ruled that the penalty of dismissal imposed on respondent was too harsh and further directed petitioner to immediately reinstate respondent to her former position, if possible, or a substantially equivalent position without loss of seniority rights and with full backwages.
ISSUE: Did the CA err by being liberal and decided a question of substance not in accord with law?
HELD: In termination cases, the burden of proof rests on the employer to show that the dismissal was for just cause. Otherwise, an employee who is illegally dismissed "shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages, inclusive of allowances, and to his other benefits or their monetary equivalent computed from the time his compensation was withheld from him up to the time of his actual reinstatement."
The Labor Code mandates that before an employer may validly dismiss an employee from the service, the requirement of substantial and procedural due process must be complied with. Under the requirement of substantial due process, the grounds for termination of employment must be based on just or authorized causes.
The SC finds that Gacayan's dismissal from employment was not grounded on any of the just causes enumerated under Article 282 of the Labor Code. At the outset, it is important to note that the term "trust and confidence" is restricted to managerial employees. In the instant case, the basis for terminating the employment of respondent was for gross violation of the company's rules and regulations. However, no mention was made regarding petitioners alleged loss of trust and confidence in respondent. Neither was there any explanation nor discussion of the alleged sensitive and delicate position of respondent requiring the utmost trust of petitioner.