JOSEFA S. DANGUILAN, PETITIONER, V. THE HONORABLE NATIONAL LABOR RELATIONS COMMISSION AND PHILIPPINE PLAZA HOLDINGS, INC., RESPONDENTS.

Danguilan versus Philippine Plaza Holdings

The Case

This is a petition for certiorari under Rule 65 of the Rules of Court filed by Josefa S. Danguilan against the National Labor Relations Commission and Philippine Plaza Holdings, Inc. The petitioner, a cashier in the hotel's Cafe Plaza Restaurant, asks the Supreme Court to annul the resolutions of the National Labor Relations Commission which affirmed the Labor Arbiter's dismissal of her complaint for illegal dismissal and money claims. The case matters because it is the Supreme Court's own application of its earlier ruling in Philippine Plaza Holdings versus Episcope, and it teaches how loss of trust and confidence is proved in the dismissal of a cashier who holds a position of responsibility, trust and confidence.

Procedural History

Josefa S. Danguilan filed a complaint for illegal dismissal and money claims before the Labor Arbiter. On December 29, 2005, the Labor Arbiter rendered a decision dismissing the complaint for lack of merit. She appealed to the National Labor Relations Commission, which, in its resolution dated February 14, 2007, denied the appeal for lack of merit. Her motion for reconsideration was denied in the Commission's resolution dated May 31, 2007. She then filed with the Supreme Court this petition for certiorari under Rule 65, raising the sole ground that the Commission committed grave abuse of discretion amounting to lack or excess of jurisdiction when it dismissed the appeal and thereby upheld the legality of her dismissal.

Facts

Josefa S. Danguilan served as a cashier in the Cafe Plaza Restaurant of Philippine Plaza Holdings, Inc. On September 1, 2004, auditors from the Sycip, Gorres and Velayo Auditing Firm, hired by the hotel as professional shoppers to audit its various services, posted and acted as customers of the restaurant. The petitioner, as cashier, settled their check and received payment from the service attendant, Luzviminda Andal.

The transaction produced two documents bearing two different amounts. The receipt prepared and issued to the auditors reflected the full amount of 3,130 pesos and 48 centavos. The settlement check, however, reflected only 2,324 pesos and 60 centavos, because a Starwood Privilege Discount Card in the name of Arnold Andal had been applied, reducing the amount remitted to the hotel by 805 pesos and 74 centavos. The auditors stated that they did not present any discount card, and the receipt given to them did not show the discount.

The hotel issued a Show Cause Memorandum dated September 30, 2004 directing the petitioner to explain in writing the questionable and invalid application of discounts. She replied in a letter dated October 1, 2004. The hotel then issued another memorandum directing her to attend an administrative hearing, which was held on October 8, 2004. Only after notice and hearing did the hotel issue the termination letter dated November 4, 2004. The petitioner then filed her complaint, insisting that she never applied any discount and that the auditors' report was unsigned and its authors were never presented for confrontation.

Issues

• Whether or not the National Labor Relations Commission committed grave abuse of discretion amounting to lack or excess of jurisdiction in dismissing the appeal and upholding the legality of the petitioner's dismissal.
• Whether or not the private respondent sufficiently proved loss of trust and confidence as a just cause for dismissing the petitioner.
• Whether or not the petitioner was accorded due process of law before her dismissal.

Applicable Provisions

The decision rests on the just causes of termination under Article 282 of the Labor Code, which provides:

An employer may terminate an employment for any of the following causes: Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or representative in connection with his work; Gross and habitual neglect by the employee of his duties; Fraud or willful breach by the employee of the trust reposed in him by his employer or duly authorized representative; Commission of a crime or offense by the employee against the person of his employer or any immediate member of his family or his duly authorized representatives; and Other causes analogous to the foregoing.

The third cause, fraud or willful breach of the trust reposed in the employee, is the ground on which the dismissal of the petitioner, a cashier holding a position of trust and confidence, was sustained.

Ruling

On the first issue, the Court held that the Commission did not commit grave abuse of discretion, which it defined as capricious and whimsical exercise of judgment equivalent to an excess or lack of jurisdiction. The findings of the Labor Arbiter, when affirmed by the Commission and supported by substantial evidence, are accorded due respect and finality and are binding upon the Court.

On the second issue, the Court held that the private respondent sufficiently proved loss of trust and confidence. The petitioner, as the cashier who handled the transaction, knew that the receipt she issued reflected 3,130 pesos and 48 centavos while the settlement check she prepared reflected only 2,324 pesos and 60 centavos. Generating two different amounts for a single customer transaction, with the difference representing loss of income for the hotel, could not have been mere error or inadvertence. The Court quoted its earlier ruling in Philippine Plaza Holdings versus Episcope:

As a general rule, employers are allowed a wider latitude of discretion in terminating the services of employees who perform functions by which their nature require the employer's full trust and confidence. Mere existence of basis for believing that the employee has breached the trust and confidence of the employer is sufficient and does not require proof beyond reasonable doubt.

The Court also stressed that only substantial evidence is required to support a finding that the employer's trust and confidence had been breached, and that the hotel need not prove that the petitioner pocketed the difference; it was enough that a discount was improperly applied and did not go to the coffers of the hotel.

On the third issue, the Court held that the petitioner was accorded due process. She was issued a Show Cause Memorandum, she submitted a written reply, she was directed to attend an administrative hearing, and the hearing was held before the termination letter was issued.

Doctrine

Loss of trust and confidence, as a just cause under Article 282 of the Labor Code, requires only substantial evidence, not proof beyond reasonable doubt. Employers are allowed a wider latitude of discretion in terminating employees who perform functions requiring full trust and confidence, such as a cashier with custody of the employer's funds. The employer need not prove that the employee pocketed the difference; it is sufficient that it established that a discount was improperly applied and that the amount did not reach the employer's coffers. Finally, the findings of the Labor Arbiter, when affirmed by the National Labor Relations Commission and supported by substantial evidence, are binding on the Court.

Disposition

The petition was denied, and the resolutions of the National Labor Relations Commission were upheld, so the private respondent prevailed and the dismissal of the petitioner was declared legal.

Remember This

Memorize this line: for employees occupying positions of trust and confidence, mere existence of a basis for believing that the employee breached the employer's trust is sufficient, and only substantial evidence is required. Examiners use this case to test loss of trust and confidence as a just cause and the finality accorded to the factual findings of the Labor Arbiter and the National Labor Relations Commission.