FIRST DIVISION
[G.R. No. 193615. June 30, 2021.]
FILIPINAS ALLIED MAINTENANCE AND SPECIAL SERVICES and/or ELLEN T. REDOR, petitioners, vs.FILIPINA CRUZ, respondent.
NOTICE
Sirs/Mesdames :
Please take notice that the Court, First Division, issued a Resolution dated June 30, 2021which reads as follows:
"G.R. No. 193615 (Filipinas Allied Maintenance and Special Services and/or Ellen T. Redor v. Filipina Cruz). — Before Us is an appeal by certiorari1 under Rule 45 of the Rules of Court filed by petitioner company Filipinas Allied Maintenance and Special Services (FAMASS) assailing the Decision 2 dated May 26, 2010 of the Court of Appeals (CA) in CA-G.R. SP No. 112200.
Facts of the Case
FAMASS is a domestic corporation engaged in the business of providing janitorial services. Respondent Filipina Cruz (Cruz) had been working with FAMASS since July 16, 1994 as a Field Operations Manager. Cruz claimed that beginning February 2005, FAMASS did not pay her and other employees' monthly salaries. Cruz's monthly salary in 2005 amounted to P13,200.00. She and the other employees claimed that they were unable to report for work because they could no longer afford transportation costs. 3 In a Letter 4 dated August 10, 2005, Cruz demanded payment of her and the other employees' back salaries, their entitled benefits and remittance of SSS, PhilHealth and Pag-IBIG contributions. She also advised that failure of the company to act on the demand will constrain her and them other employees to file an appropriate action against the company. As Cruz and the other employees did not receive any response from FAMASS, they filed a complaint with the NCR-Regional Director of the Department of Labor and Employment (DOLE) for non-payment of salaries. The case was entitled "In the matter of Labor Standards Inspection conducted at FILIPINAS ALLIED MAINTENANCE & SPECIAL SERVICES (26 Manggahupoy St., Pilar Village, Las Piñas City)/Ms. Cyra Tapiador, Manager/Owner)" and docketed as Case No. NCROO-LSED-0509-IS-004. 5 CAIHTE
Instead of a letter response to the employees' money claims, FAMASS issued a Memorandum 6 dated September 16, 2005 permanently transferring Cruz from field operations to report to the company office. The Memorandum reads:
Please be informed that starting September 19, 2005, Monday, you are permanently assigned in the office. All roving inspections and fieldwork assign (sic) to you will be endorsed to Ms. Lou de Paz. Please be guided accordingly. 7
Cruz claimed that the reassignment constituted an unjustified demotion in rank as her monthly salary amounting to P13,200.00 decreased to P8,000.00. She also claimed that she reported to the company office but was only made to sit the entire day without any work assignment. Aside from the demotion in rank, FAMASS still did not pay Cruz her monthly salary. As a result, she, together with another employee, Ricardo Marquez (Marquez), filed a complaint against FAMASS for constructive dismissal, payment of damages, separation pay in lieu of reinstatement and attorney's fees. The case was docketed as NLRC NCR Case No. 00-10-08755-2005. 8
Petitioner FAMASS, on the other hand, moved to dismiss the illegal dismissal case on the ground of forum-shopping. The company argued that a prior case for non-payment of salaries had already been filed by the employees. Furthermore, Cruz's reassignment to the company office was an exercise of its management discretion with a goal to promote sound business betterment. 9
Proceedings in Case No. NCROO-LSED-0509-IS-004(Non-payment of Salaries case)
On October 20, 2005, the DOLE NCR-Regional Director issued an Order 10 finding that FAMASS failed to pay the salaries of Cruz and other employees. FAMASS was directed to effect payment within ten days from receipt of the order. 11 With the Order attaining finality due to FAMASS's failure to perfect the appeal, Cruz and the other employees were eventually paid their money claims. 12 The case was declared closed and terminated. 13
Proceedings in NLRC NCR Case No. 00-10-08755-2005(Constructive Dismissal case)
The motion to dismiss filed by FAMASS was denied by the Labor Arbiter (LA) in an Order 14 dated February 16, 2006. The LA directed the parties to file their respective position papers. Thereafter, on September 25, 2007, the LA rendered its Decision 15 dismissing the employees' complaint for lack of merit. The LA was unconvinced that the employees were constructively dismissed. Particularly in Cruz's case, the LA held that she failed to establish any unreasonable act or omission by FAMASS which would force her to sever the employer-employee relationship. The fact that Cruz was permanently assigned from her duties as a fieldworker to an office does not prove constructive dismissal. Her transfer was only in the exercise of FAMASS's management prerogative. The LA held that aspects of employment such as hiring, work assignments, working methods, time, place, manner of work, lay-off of workers, and the discipline, dismissal and recall of workers are subject to the control of the employer. The LA even observed that Cruz's reassignment to the company office actually benefitted her. By removing Cruz from fieldwork, the LA held that she was relieved from her alleged problem of transportation costs. Finally, the LA did not award any of the employees' money claims. While the employees' alleged in their position paper unpaid wages and payment of benefits, the LA observed that the same were not included as causes of action in the pro-forma complaint. The National Labor Relations Commission (NLRC) rules of procedure provide that causes of action in the position paper not raised in the complaint will be barred. Furthermore, the LA found that the employees' money claims have already been passed upon by the DOLE NCR-Regional Director in the Order 16 dated October 20, 2005 in Case No. NCROO-LSED-0509-IS-004. 17 DETACa
In compliance with the Decision of the LA, Cruz and Marquez returned to work. Cruz, however, claimed that she received humiliating treatment from the daughter of petitioner Ellen T. Redor, President of FAMASS, and was often told to resign. After a month from returning to work, Cruz no longer reported back to the company. 18
Ruling of the National Labor Relations Commission
Cruz and Marquez filed an appeal with the NLRC, which was dismissed for non-perfection. The NLRC held that the employees failed to append a certificate of non-forum shopping. Cruz solely moved to reconsider the Resolution of the NLRC, wherein she attached a certificate of non-forum shopping. 19 In a Resolution 20 dated August 27, 2009, the NLRC set aside the dismissal of the appeal in relation to Cruz and ruled that she was constructively dismissed from employment because she was unjustly relieved by FAMASS from her duties as a Field Operations Manager. The NLRC became suspect of the company's decision to reassign Cruz from the Field Operations Manager post to office management. The timing of Cruz's transfer came too close to her demand of unpaid salaries and filing of a complaint with DOLE against the company. The NLRC concluded that Cruz's transfer of post, although claimed by FAMASS to be prompted by an exigency in the business operations, had not been supported by valid reasons. The NLRC held that Cruz demonstrated willingness to resume work. In fact, she returned to work in compliance with the LA Decision. However, she decided to stop going to work after receiving humiliating treatment at the office. The NLRC held that this fact should not be taken against her. FAMASS was directed to pay Cruz backwages reckoned from her constructive. dismissal on 16 September 2005, separation pay equivalent to one month pay for every year of service in lieu of reinstatement and 10% attorney's fees of the judgment award. 21
Ruling of the Court of Appeals
FAMASS assailed the NLRC Decision to the CA by certiorari22 under Rule 65 of the Rules Court. In a Decision 23 dated May 26, 2010, the CA denied the petition and affirmed the finding of the NLRC that Cruz had been constructively dismissed from employment. The CA explained that the test of constructive dismissal is whether a reasonable employee would have felt compelled to leave employment by some act or omission by the employer. The CA found that FAMASS's non-payment of Cruz's salaries since January 2005 and the abrupt transfer by the company of her post from fieldwork management to office management without any explanation constitute constructive dismissal. The CA also remained unconvinced of FAMASS's assertion that Cruz voluntarily stopped going to work. Reiterating the observations of the NLRC, the CA held that Cruz no longer reported for work because she was humiliated. Finding that Cruz had been illegally dismissed from employment, she was awarded payment of backwages, separation pay and attorney's fees. 24
Proceedings before the Court
FAMASS assailed the Decision of the CA before this Court. The company denied the illegal dismissal of Cruz because she voluntarily severed employment with the company. FAMASS also claimed that Cruz failed to establish the fact of her dismissal from employment. Thus, the company need not prove whether the dismissal is valid. Finally, as there is no dismissal from employment, Cruz is not entitled to payment of backwages or separation pay. 25 aDSIHc
In the Comment, 26 Cruz argued that the appeal by certiorari should be dismissed outright for FAMASS's failure to show that the CA erred in finding her constructively dismissed from employment. She emphasized FAMASS's unjust actions to immediately pay her salaries and her demotion in rank. The company's decision to transfer her from the field to the office was done in bad faith as it was a reaction to her demand for payment of back salaries and filing of the case before the DOLE NCR-Regional Director. 27
Meanwhile, on November 5, 2010, the LA issued a Writ of Execution 28 pursuant to the Resolution 29 dated August 27, 2009 of the NLRC finding Cruz constructively dismissed from employment. Under the Writ, FAMASS was directed to pay Cruz the total money award in the amount of P1,177,216.62. 30
FAMASS then filed with this Court an Extremely Urgent Motion 31 praying for the issuance of an injunctive writ. The company sought to enjoin the NLRC in enforcing the Writ of Execution. FAMASS explained that by executing on the Writ, the petition before this Court, determining whether or not Cruz had been illegally dismissed from employment, would be moot and academic. 32
On December 9, 2010, FAMASS and Cruz appeared before the LA and entered into a compromise agreement. The parties agreed that FAMASS shall pay the amount of P750,000.00 to Cruz as full and complete settlement of all her claims against the company. Cruz executed a Quitclaim and Release 33 to this effect. Per the cash vouchers 34 issued by FAMASS, payment of P750,000.00 consisted of a check for the amount of P100,000.00 and 10 checks dated December 20, 2010 until September 20, 2011 with an aggregate value of P650,000.00. 35
In view of the foregoing, FAMASS filed with this Court a Satisfaction of Monetary Claims 36 manifesting that the monetary claims of Cruz in relation to the constructive dismissal case have been finally settled. FAMASS prayed that this Court admit the settlement as sufficient compliance to its obligation. 37
Cruz, on the other hand, filed a Comment 38 dated April 14, 2011, opposing to FAMASS's prayer. She asserted that it would be premature for this Court to admit that her money claims have been finally settled or satisfied considering that she will only be fully paid when the last check dated September 20, 2011 is made good with her depository bank. 39
In a Reply 40 dated May 20, 2011, FAMASS argued that it had been compelled to enter a settlement with Cruz out of "fear of the enforcement of the Writ of Execution" 41 which may cause damage and prejudice to the company. It reiterated its prayer for the issuance of an injunctive writ to enjoin enforcement of the CA Decision which affirmed the Decision of the NLRC finding Cruz constructively dismissed from employment. FAMASS also prayed to reverse and set aside the Decision of the CA and to dismiss Cruz's illegal dismissal complaint for lack of merit. 42
Ruling of the Court
Courts recognize the employer's management rights and prerogatives and would not interfere with its business decisions. 43 However, an employer's inherent right to exercise management discretion has its limitations as imposed by labor laws, principles of equity and substantial justice. 44 If an employer is found to act beyond these limitations, Courts do not shy away from tempering the unbridled exercise of management rights and prerogatives.
In this case, FAMASS claimed that Cruz's transfer of post as Field Operations Manager to office work is an exercise of its management prerogative. For this Court to uphold the validity of the transfer, the company must be able to show that it is not unreasonable, inconvenient or prejudicial to Cruz. There must be 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. Otherwise, there is constructive dismissal of an employee. 45 ETHIDa
We hold that FAMASS failed to justify the transfer of Cruz. The company mainly argued that her transfer was "to achieve the noble business goal of promoting sound business betterment and expediency of service." 46 It did not deny or disprove, through records, Cruz's allegations of diminution of salary or the fact that no sufficient cause was provided on her abrupt transfer of posts. We note that Cruz had been working as a Field Operations Manager with the company since 1994. Therefore, it is only sound that the company advise Cruz of the reasons of the change in the nature of her work for 11 years. Instead, FAMASS issued a Memorandum dated September 16, 2005, simply ordering Cruz's transfer to office work. We also find questionable Cruz's transfer from her work of 11 years to a new office post. Similar to the observations of the NLRC and the CA, the timing of Cruz's transfer came too close to her demand of unpaid salaries and filing of a complaint with DOLE against the company. To Our mind, Cruz's transfer to the office with lesser pay is a punishment and clearly a demotion.
In an attempt to evade liability, FAMASS argues that there is no dismissal because Cruz stopped reporting for work. We remain unconvinced. Based on the facts, Cruz reported to the office after the company's notice of transfer. However, she claimed that she was not given any work assignments, which the company failed to dispute. Moreover, after the LA Order of reinstatement, Cruz complied with the same, but found the workplace intolerable after being told by her employers to resign, which the company again did not deny. Further, the company could have easily issued and sent Cruz a return to work order with notice to explain for her unexplained absences, but they did not. The foregoing demonstrate FAMASS's acts of insensibility and disdain which made the workplace for Cruz unbearable leaving her with no option except to forego her continued employment. Thus, We hold that Cruz is constructively and illegally dismissed from employment.
Finding illegal dismissal, We award payment of full backwages, 47 separation pay in lieu of reinstatement and attorney's fees equivalent to 10% of the money award. We note that the parties executed a compromise agreement before the LA with the assistance of their respective counsels. 48 FAMASS undertook to pay Cruz, in installments, the amount of P750,000.00 as complete and full satisfaction of all her claims from the company. Cruz, on the other hand, executed a Quitclaim and Release 49 in favor of the company which was sworn before the LA. Despite the execution of the foregoing, We hold that the consideration in the agreement could not be considered as full satisfaction of Cruz's claims from the company. FAMASS still sought this Court to decide on the merits claiming that it had only been compelled to enter into the compromise agreement to avoid the execution of the Writ pursuant to the August 27, 2009 NLRC Resolution 50 finding Cruz constructively dismissed. Thus, as We found Cruz illegally dismissed from employment, the amount of P750,000.00, if shown to be paid to Cruz, must be deducted from the total money award.
WHEREFORE, the petition is DENIED. The Decision dated May 26, 2010 of the Court of Appeals in CA-G.R. SP No. 112200 is hereby AFFIRMED with MODIFICATION. Finding respondent Filipina Cruz constructively and illegally dismissed from employment, petitioner Filipinas Allied Maintenance and Special Services is ORDERED to pay respondent Filipina Cruz the following:
1) Full backwages from the time of her illegal dismissal on September 16, 2005 until finality of this Resolution;
2) Separation pay in lieu of reinstatement equivalent to one (1) month's salary for every year of her service beginning 1994 until finality of this Resolution; cSEDTC
3) Ten percent (10%) of the money award as attorney's fees;
4) The amount of P750,000.00, if shown to be paid to Cruz, must be deducted from the total money award; and
5) All monetary award shall earn an interest rate of six percent (6%) per annum from the finality of this Resolution until full satisfaction.
Let the case be REMANDED to the Labor Arbiter for purposes of computation of the money award.
SO ORDERED."
By authority of the Court:
(SGD.) LIBRADA C. BUENADivision Clerk of Court
By:
MARIA TERESA B. SIBULODeputy Division Clerk of Court
Footnotes
1.Rollo, pp. 3-16.
2. Penned by Associate Justice Celia C. Librea-Leagogo, with the concurrence of Associate Justices Remedios A. Salazar-Fernando and Michael P. Elbinias; id. at 27-41.
3.Id. at 29.
4.Id. at 153.
5.Id. at 155-156.
6.Id. at 160.
7.Id.
8.Id. at 124-126.
9.Id. at 157-159.
10. Penned by Regional Director Ricardo S. Martinez, Sr., Ceso III; id. at 155-156.
11.Id.
12.Id. at 168-169.
13.Id. at 264.
14.Id. at 123-124.
15. Penned by Labor Arbiter Herminio V. Suelo; id. at 122-134.
16.Id. at 155-156.
17.Id. at 130-134.
18.Id. at 117-119.
19.Id. at 112.
20. Penned by Commissioner Isabel G. Panganiban-Ortiguerra, with the concurrence of Presiding Commissioner Benedicto R. Palacol and Commissioner Nieves Vivar-De Castro; id. at 112-120.
21.Id. at 117-120.
22.Id. at 49-86.
23.Supra note 2.
24.Rollo, pp. 35-40.
25.Id. at 9-13.
26.Id. at 305-309.
27.Id.
28.Id. at 298-302.
29.Supra note 20.
30.Rollo, p. 301.
31.Id. at 293-294.
32.Id.
33.Id. at 351.
34.Id. at 352-353.
35.Id.
36.Id. at 345-346.
37.Id.
38.Id. at 355.
39.Id.
40.Id. at 358-361.
41.Id. at 358.
42.Id. at 358-361.
43.Isabela-I Electric Coop., Inc. v. Del Rosario, Jr., G.R. No. 226369, July 17, 2019.
44.Peckson v. Robinsons Supermarket Corp., 713 Phil. 471, 480-481 (2013), citing Rural Bank of Cantilan, Inc. v. Julve, 545 Phil. 619, 624 (2007).
45.Phil. Industrial Security Agency Corp. v. Aguinaldo, 499 Phil. 215, 226 (2005).
46.Rollo, p. 157.
47. Article 294 of the Labor Code of the Philippines, previously numbered as Article 274.
48.Rollo, p. 345.
49.Id. at 351.
50.Supra note 20.