8R FLANDERS CFS, INC./ PRAXEDES YU TAN, PETITIONERS, VS. NATIONAL LABOR RELATIONS COMMISSION (SIXTH DIVISION) AND RIGOR DELA CRUZ, RESPONDENTS.
BARZA, J.:
Petitioners initially hired private respondent Rigor Dela Cruz as a messenger in June 2000 with a salary of Php6,000.00 a month. He was later promoted to warehouse checker and paid Php11,000.00 a month. As warehouse checker, private respondent’s duty was to ensure that all cargo received and released in the company’s warehouse are grouped together, delivered to the right consignees and properly accounted for.
During his stint as warehouse checker, private respondent committed various infractions on several occasions, prompting petitioners to issue several memoranda on him. It appears that private respondent had been responsible for a number of incidents where the cargoes for some of the company’s clients got mixed up. Private respondent submitted his explanation to each show cause memo that was issued on him. On February 29, 2012, the company informed private respondent of the management’s decision to terminate his employment.
On June 19, 2012, private respondent filed a case for illegal dismissal against petitioners. In a decision[3] dated October 15, 2012, the Labor Arbiter found private respondent to have been validly dismissed from his work for his inefficiency and incompetence, a form of neglect of duty. Thus, the Labor Arbiter ruled that private respondent was guilty of habitual neglect of duty. But despite the finding of just cause for termination, the Labor Arbiter decided to award private respondent separation pay as financial assistance in an amount equivalent to ½ month pay for every year of service or a total of Php72,000.00. Petitioners appealed the judgment to the NLRC. In the assailed NLRC decision dated April 23, 2013, the NLRC denied petitioners’ appeal. But contrary to the ruling of the Labor Arbiter, the NLRC found that private respondent’s dismissal was not based on just cause, but because he did not appeal the Labor Arbiter’s judgment, he was entitled to no other relief than the financial assistance subject of the instant case. Thus, the NLRC said that private respondent was all the more entitled to separation pay. But the NLRC agreed with the Labor Arbiter that private respondent’s actions did not amount to serious misconduct or reflect moral depravity on his part, thus, separation pay as a measure of social and compassionate justice is allowed. The NLRC took into consideration private respondent’s untarnished (except for the subject infractions) 12-year employment record.
The denial of petitioners’ appeal with the NLRC, however, was not unanimous. NLRC Commissioner Nieves E. Vivar-De Castro dissented, stating that private respondent’s dismissal was for just cause (gross and habitual neglect of duty), hence, there was no basis to award financial assistance.[4] Petitioners moved for the reconsideration of the NLRC decision but the same was denied in the assailed resolution dated June 11, 2013. Thus, the petition for certiorari.
The sole issue in the petition is the propriety of the award of separation pay to private respondent. Citing Apacible vs. Multimed Industries Incorporated, et al.,[5] petitioners argue that the grant of separation pay is proscribed when the dismissal is based on any of the grounds mentioned in Article 282 of the Labor Code. They also posit that the computation of separation pay at ½ month salary for every year of service pertains only to termination of employment under Arts. 283 and 284 of the Labor Code.
Before tackling the merits of the petition, the Court notes the notice of withdrawal of appearance[6] of petitioners’ counsel, the R & S Law Offices, received on January 15, 2013.
We grant the petition.
Both the Labor Arbiter and the NLRC in their respective decisions agreed to the award of separation pay as a form of social justice, but they differed in their opinions as to the validity of private respondent’s dismissal. While the Labor Arbiter found just cause for termination (gross and habitual neglect of duties), the NLRC negated such finding and said that private respondent’s dismissal was not based on just and valid cause.
The Court agrees with the Labor Arbiter that private respondent’s dismissal is justified. The frequent errors committed by private respondent in the receipt and delivery of cargoes to the company’s clients resulting in a mix-up of the items is a manifestation of gross and habitual neglect of duties. Gross negligence entails want of care in the performance of one’s duties, while habitual neglect imparts repeated failure to perform such duties for a period of time, depending on the circumstances.[7] It is also noteworthy that private respondent did not appeal the Labor Arbiter’s finding of just cause for dismissal.
Art. 279 of the Labor Code mandates that an employee who is unjustly dismissed from work 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. Prescinding from the said provision of law, the reliefs available to an unjustly terminated employee are backwages and reinstatement, not separation pay as a measure of compassionate justice as in the case at bar. However, since private respondent’s termination from employment was clearly for valid cause, the award of separation pay to private respondent is all the more unwarranted.
In the case of Manila Water Company vs. Carlito Del Rosario,[8] the Supreme Court held –
“As a general rule, an employee who has been dismissed for any of the just causes enumerated under Article 282 of the Labor Code is not entitled to a separation pay. Section 7, Rule I, Book VI of the Omnibus Rules implementing the Labor Code provides:
Sec. 7. Termination of employment by employer. — The just causes for terminating the services of an employee shall be those provided in Article 282 of the Code. The separation from work of an employee for a just cause does not entitle him to the termination pay provided in the Code, without prejudice, however, to whatever rights, benefits and privileges he may have under the applicable individual or collective agreement with the employer or voluntary employer policy or practice.
In exceptional cases, however, the Court has granted separation pay to a legally dismissed employee as an act of “social justice” or on “equitable grounds.” In both instances, it is required that the dismissal (1) was not for serious misconduct; and (2) did not reflect on the moral character of the employee.
In the leading case of Philippine Long Distance Telephone Company v. NLRC, we laid down the rule that separation pay shall be allowed as a measure of social justice only in the instances where the employee is validly dismissed for causes other than serious misconduct reflecting his moral character. We clarified that:
‘We hold that henceforth separation pay shall be allowed as a measure of social justice only in those instances where the employee is validly dismissed for causes other than serious misconduct or those reflecting on his moral character. Where the reason for the valid dismissal is, for example, habitual intoxication or an offense involving moral turpitude, like theft or illicit sexual relations with a fellow worker, the employer may not be required to give the dismissed employee separation pay, or financial assistance, or whatever other name it is called, on the ground of social justice.
A contrary rule would, as the petitioner correctly argues, have the effect, of rewarding rather than punishing the erring employee for his offense. And we do not agree that the punishment is his dismissal only and that the separation pay has nothing to do with the wrong he has committed. Of course it has. Indeed, if the employee who steals from the company is granted separation pay even as he is validly dismissed, it is not unlikely that he will commit a similar offense in his next employment because he thinks he can expect a like leniency if he is again found out. This kind of misplaced compassion is not going to do labor in general any good as it will encourage the infiltration of its ranks by those who do not deserve the protection and concern of the Constitution.
The policy of social justice is not intended to countenance wrongdoing simply because it is committed by the underprivileged. At best[,] it may mitigate the penalty but it certainly will not condone the offense. Compassion for the poor is an imperative of every humane society but only when the recipient is not a rascal claiming an undeserved privilege. Social justice cannot be permitted to be refuge of scoundrels any more than can equity be an impediment to the punishment of the guilty. Those who invoke social justice may do so only if their hands are clean and their motives blameless and not simply because they happen to be poor. This great policy of our Constitution is not meant for the protection of those who have proved they are not worthy of it, like the workers who have tainted the cause of labor with the blemishes of their own character.’
In the subsequent case of Toyota Motor Phils. Corp. Workers Association (TMPCWA) v. National Labor Relations Commission, we expanded the exclusions and elucidated that separation pay shall be allowed as a measure of social justice only in instances where the employee is validly dismissed for causes other than serious misconduct, willful disobedience, gross and habitual neglect of duty, fraud or willful breach of trust, commission of a crime against the employer or his family, or those reflecting on his moral character. In the same case, we instructed the labor officials that they must be most judicious and circumspect in awarding separation pay or financial assistance as the constitutional policy to provide full protection to labor is not meant to be an instrument to oppress the employers. The commitment of the court to the cause of the labor should not embarrass us from sustaining the employers when they are right, as here. In fine, we should be more cautious in awarding financial assistance to the undeserving and those who are unworthy of liberality of the law.
Guided by the foregoing rules, we have carefully treaded the path of compassionate justice in the subsequent cases so as not to slip and favor labor at the expense of management.”
But while the Court agrees with the Labor Arbiter’s finding of just cause for dismissal, We cannot subscribe to its award of separation pay to private respondent on account of his length of service. In Immaculate Concpecion Academy, et al. vs. Evelyn Camilon,[9] it was held –
“As to whether respondent’s length of service with petitioners justifies the award of separation pay, we rule in the negative. Respondent’s 12 years of service and clean employment record cannot simply erase her gross and habitual negligence in her duties. Length of service is not a bargaining chip that can simply be stacked against the employer. As we held in Central Pangasinan Electric Cooperative, Inc. v. NLRC,
‘Although long years of service might generally be considered for the award of separation benefits or some form of financial assistance to mitigate the effects of termination, this case is not the appropriate instance for generosity . . . The fact that private respondent served petitioner for more than twenty years with no negative record prior to his dismissal, in our view of this case, does not call for such award of benefits, since his violation reflects a regrettable lack of loyalty and worse, betrayal of the company. If an employee’s length of service is to be regarded as a justification for moderating the penalty of dismissal, such gesture will actually become a prize for disloyalty, distorting the meaning of social justice and undermining the efforts of labor to cleanse its ranks of undesirables.’”
WHEREFORE, premises considered, the Court hereby GRANTS the instant petition for certiorari. The assailed NLRC decision dated April 23, 2013 and the resolution dated June 11, 2013, are hereby ANNULLED. A new judgment is hereby entered reinstating the Labor Arbiter’s finding of lawful dismissal from employment but deleting the grant of separation pay to private respondent Rigor Dela Cruz.
SO ORDERED.
Carandang, R. D., Chairperson, and Reyes-Carpio, A., JJ., concur.
[1] Rollo, pp. 44-52.
[2] Ibid., pp. 63-65.
[3] Ibid., pp. 21-27.
[4] Ibid., pp. 51-52.
[5] G.R. No. 178903, May 30, 2011.
[6] Rollo, loose leaf.
[7] FLP Enterprises, Inc., et al. vs. Ma. Joeralyn D. Dela Cruz, et al., G.R. No. 198093, July 28, 2014.
[8] G.R. No. 188747, January 29, 2014.
[9] G.R. No. 188035, July 2, 2014.