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SUPREME COURT Baguio City THIRD DIVISION Armando Aliling vs. Jose B. Feliciano, Manuel F.

San Mateo III, et al., G.R. No. 185829. April 25, 2012 Nature of the Case: This Petition for Review on Certiorari under Rule 45 assails and seeks to set aside the July 3, 2008 Decision and December 15, 2008 Resolution of the Court of Appeals (CA), in CA-G.R. SP No. 101309, entitled Armando Aliling v. National Labor Relations Commission, Wide Wide World Express Corporation, Jose B. Feliciano, Manuel F. San Mateo III and Joseph R. Lariosa. Facts: Respondent Wide Wide World Express Corporation (WWWEC) offered to employ petitioner Armando Aliling (Aliling) on June 2, 2004 as Account Executive (Seafreight Sales), with a compensation package of a monthly salary of PhP 13,000, transportation allowance of PhP 3,000, clothing allowance of PhP 800, cost of living allowance of PhP 500, each payable on a per month basis and a 14th month pay depending on the profitability and availability of financial resources of the company. The offer came with a six (6)-month probation period condition with this express caveat: Performance during probationary period shall be made as basis for confirmation to Regular or Permanent Status. On June 11, 2004, Aliling and WWWEC inked an Employment Contract under the terms of conversion to regular status shall be determined on the basis of work performance; and employment services may, at any time, be terminated for just cause or in accordance with the standards defined at the time of engagement. However, instead of a Seafreight Sale assignment, WWWEC asked Aliling to handle Ground Express (GX), a new company product launched on June 18, 2004 involving domestic cargo forwarding service for Luzon. Marketing this product and finding daily contracts for it formed the core of Alilings new assignment. A month after, Manuel F. San Mateo III (San Mateo), WWWEC Sales and Marketing Director, emailed Aliling to express dissatisfaction with the latters performance. On September 25, 2004, Joseph R. Lariosa (Lariosa), Human Resources Manager of WWWEC, asked Aliling to report to the Human Resources Department to explain his absence taken without leave from September 20, 2004. Aliling responded two days later. He denied being absent on the days in question, attaching to his reply-letter a copy of his timesheet which showed that he worked from September 20 to 24, 2004. Alilings explanation came with a query regarding the withholding of his salary corresponding to September 11 to 25, 2004. On October 15, 2004, Aliling tendered his resignation to San Mateo. While WWWEC took no action on his tender, Aliling nonetheless demanded reinstatement and a written apology, claiming in a subsequent letter dated October 1, 2004 to management that San Mateo had forced him to resign. Lariosas response-letter of October 1, 2004, informed Aliling that his case was still in the process of being evaluated. On October 6, 2004, Lariosa again wrote, this time to advise Aliling of the termination of his services effective as of that date owing to his non-satisfactory performance during his probationary period. Records show that Aliling, for the period indicated, was paid his outstanding salary. However, or on October 4, 2004, Aliling filed a Complaint for illegal dismissal due to forced resignation, nonpayment of salaries as well as damages with the NLRC against WWWEC. Appended to the complaint was Alilings Affidavit dated November 12, 2004, in which he stated: 5. At the time of my engagement, respondents did not make known to me the standards under which I will qualify as a regular employee.

Refuting Alilings basic posture, WWWEC stated that in the letter offer and employment contract adverted to, WWWEC and Aliling have signed a letter of appointment on June 11, 2004 containing the terms of engagement. WWWEC also attached to its Position Paper a memo dated September 20, 2004 in which San Mateo asked Aliling to explain why he should not be terminated for failure to meet the expected job performance, considering that the load factor for the GX Shuttles for the period July to September was only 0.18% as opposed to the allegedly agreed upon load of 80% targeted for August 5, 2004. According to WWWEC, Aliling, instead of explaining himself, simply submitted a resignation letter. On April 25, 2006, the Labor Arbiter issued a decision declaring that the grounds upon which complainants dismissal was based did not conform not only the standard but also the compliance required under Article 281 of the Labor Code, Necessarily, complainants termination is not justified for failure to comply with the mandate the law requires. Respondents should be ordered to pay salaries corresponding to the unexpired portion of the contract of employment and all other benefits amounting to a total of P35,811.00 covering the period from October 6 to December 7, 2004. The Labor Arbiter explained that Aliling cannot be validly terminated for non-compliance with thw quota threshold absent a prior advisory of the reasonable standards upon which his performance would be evaluated. Both parties appealed the decision to the NLRC, which affirmed the decision of the Labor Arbiter. The separate motions for reconsideration were also denied by the NLRC. The CA anchored its assailed action on the strength of the following premises: (a) respondents failed to prove that Alilings dismal performance constituted gross and habitual neglect necessary to justify his dismissal; (b) not having been informed at the time of his engagement of the reasonable standards under which he will qualify as a regular employee, Aliling was deemed to have been hired from day one as a regular employee; and (c) the strained relationship existing between the parties argues against the propriety of reinstatement. Hence, the instant petition. Issues: 1) Whether petitioner is a regular employee. 2) Whether petitioner was illegally dismissed.or his right to security of tenure was violated. 3) Whether Alilings right to procedural due process was violated. 4) Whether Aliling is entitled to backwages and separation pay in lieu of reinstatement. Ruling: 1) Petitioner was regularized from the time of the execution of the employment contract on June 11, 2004, although respondent company had arbitrarily shortened his tenure. As pointed out, respondent company did not make known the reasonable standards under which he will qualify as a regular employee at the time of his engagement. Hence, he was deemed to have been hired from day one as a regular employee. 2) To justify fully the dismissal of an employee, the employer must, as a rule, prove that the dismissal was for a just cause and that the employee was afforded due process prior to dismissal. As a complementary principle, the employer has the onus of proving with clear, accurate, consistent, and convincing evidence the validity of the dismissal. The attendant circumstances in the instant case aptly show that the issue of petitioners alleged failure to achieve his quota, as a ground for terminating employment, strikes the Court as a mere afterthought on the part of WWWEC. Consider: Lariosas letter of September 25, 2004 already betrayed managements intention to dismiss the petitioner for alleged unauthorized absences. Aliling was in fact made to explain and he did so satisfactorily. But, lo

and behold, WWWEC nonetheless proceeded with its plan to dismiss the petitioner for non-satisfactory performance, although the corresponding termination letter dated October 6, 2004 did not even specifically state Alilings non-satisfactory performance, or that Alilings termination was by reason of his failure to achieve his set quota. Employees must be reminded that while probationary employees do not enjoy permanent status, they enjoy the constitutional protection of security of tenure. They can only be terminated for cause or when they otherwise fail to meet the reasonable standards made known to them by the employer at the time of their engagement. Respondent WWWEC miserably failed to prove the termination of petitioner was for a just cause nor was there substantial evidence to demonstrate the standards were made known to the latter at the time of his engagement. Hence, petitioners right to security of tenure was breached. 3) To effect a legal dismissal, the employer must show not only a valid ground therefor, but also that procedural due process has properly been observed. When the Labor Code speaks of procedural due process, the reference is usually to the two (2)-written notice rule envisaged in Section 2 (III), Rule XXIII, Book V of the Omnibus Rules Implementing the Labor Code. MGG Marine Services, Inc. v. NLRC tersely described the mechanics of what may be considered a two-part due process requirement which includes the twonotice rule, x x x one, of the intention to dismiss, indicating therein his acts or omissions complained against, and two, notice of the decision to dismiss; and an opportunity to answer and rebut the charges against him, in between such notices. King of Kings Transport, Inc. v. Mamac expounded on this procedural requirement in this manner: a. first written notice, b. hearing or conference, and c. written notice of termination. WWWEC did not comply with the first notice requirement. Neither was there compliance with the imperatives of a hearing or conference. The Court need not dwell at length on this particular breach of the due procedural requirement. Suffice it to point out that the record is devoid of any showing of a hearing or conference having been conducted. On the contrary, in its October 1, 2004 letter to Aliling, or barely five (5) days after it served the notice of termination, WWWEC acknowledged that it was still evaluating his case. And the written notice of termination itself did not indicate all the circumstances involving the charge to justify severance of employment. 4) As of that date June 11, 2004, Aliling became part of the WWWEC organization as a regular employee of the company without a fixed term of employment. Thus, he is entitled to backwages reckoned from the time he was illegally dismissed on October 6, 2004, with a PhP 17,300.00 monthly salary, until the finality of this Decision. Article 279 of the Labor Code, as amended by Section 34 of Republic Act 6715 instructs: Art. 279. Security of Tenure. - In cases of regular employment, the employer shall not terminate the services of an employee except for a just cause or when authorized by this Title. 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. The law intends the award of backwages and similar benefits to accumulate past the date of the Labor Arbiters decision until the dismissed employee is actually reinstated. But if, as in this case, reinstatement is no longer possible, this Court has consistently ruled that backwages shall be computed from the time of illegal dismissal until the date the decision becomes final. Additionally, Aliling is entitled to separation pay in lieu of reinstatement on the ground of strained relationship.

The basis for the payment of backwages is different from that for the award of separation pay. Separation pay is granted where reinstatement is no longer advisable because of strained relations between the employee and the employer. Backwages represent compensation that should have been earned but were not collected because of the unjust dismissal. The basis for computing backwages is usually the length of the employee's service while that for separation pay is the actual period when the employee was unlawfully prevented from working. Dispositive Portion: WHEREFORE, the petition is PARTIALLYGRANTED. The assailed Resolutions of respondent (Third Division) National Labor Relations Commission are AFFIRMED, with the following MODIFICATION/CLARIFICATION: Respondent Wide Wide World Express Corp. is liable to pay Armando Aliling the following: (a) backwages reckoned from October 6, 2004 up to the finality of this Decision based on a salary of PhP 17,300 a month, with interest at 6% per annum on the principal amount from October 6, 2004 until fully paid; (b) the additional sum equivalent to one (1) month salary for every year of service, with a fraction of at least six (6) months considered as one whole year based on the period from June 11, 2004 (date of employment contract) until the finality of this Decision, as separation pay; (c) PhP 30,000 as nominal damages; and (d) Attorneys Fees equivalent to 10% of the total award.

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