1. Employee found guilty of habitual absenteeism and tardiness not entitled to economic assistance.

Labor
adjudicatory officials and the CA must demur the award of separation pay based on social justice when an
employees dismissal is based on serious misconduct or willful disobedience; gross and habitual neglect of
duty; fraud or willful breach of trust; or commission of a crime against the person of the employer or his
immediate family grounds under Art. 282 of the Labor Code that sanction dismissals of employees. 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 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 the liberality of the law. (Quiambao vs.
Manila Electric Company, G.R. No. 171023, December 18, 2009.)
2. No work no pay scheme is not significant in determining employer-employee relationship. The fact the
respondent was paid under a no work no pay scheme, assuming this claim to be true, is not significant.
The no work no pay scheme is merely a method of computing compensation, not a basis for
determining the existence or absence of employer-employee relationship.
Abandonment of work; Requisites. Abandonment of work, or the deliberate and unjustified refusal of an
employee to resume his employment, is a just cause for the termination of employment under paragraph
(b) of Article 282 of the Labor Code, since it constitutes neglect of duty. The jurisprudential rule is that
abandonment is a matter of intention that cannot be lightly presumed from equivocal acts. To constitute
abandonment, two elements must concur: (1) the failure to report for work or absence without valid or
justifiable reason, and (2) a clear intent, manifested through overt acts, to sever the employer-employee
relationship.
Ibid; Burden of proof. The employer bears the burden of showing a deliberate and unjustified refusal by
the employee to resume his employment without any intention of returning.
Constructive Dismissal; Definition. Case law defines constructive dismissal as a cessation of work because
continued employment has been rendered impossible, unreasonable, or unlikely, as when there is a
demotion in rank or diminution in pay or both or when a clear discrimination, insensibility, or disdain by
an employer becomes unbearable to the employee.
Ibid.; Test. The test of constructive dismissal is whether a reasonable person in the employees position
would have felt compelled to give up his position under the circumstances. It is an act amounting to
dismissal but is made to appear as if it were not. In fact, the employee who is constructively dismissed
might have been allowed to keep coming to work. Constructive dismissal is therefore a dismissal in
disguise. The law recognizes and resolves this situation in favor of employees in order to protect their
rights and interests from the coercive acts of the employer. (CRC Agricultural Trading, et al. vs. NLRC, G.R.
No. 177664, December 23, 2009.)
3. Requirement for appeals involving monetary award. Appeals involving monetary awards are perfected
only upon compliance with the following mandatory requisites, namely: (1) payment of the appeal fees; (2)
filing of the memorandum of appeal; and (3) payment of the required cash or surety bond.
Appeal bond; Mandatory nature. The posting of a bond is indispensable to the perfection of an appeal in
cases involving monetary awards from the decision of the labor arbiter. The intention of the lawmakers to
make the bond a mandatory requisite for the perfection of an appeal by the employer is clearly expressed
in the provision that an appeal by the employer may be perfected only upon the posting of a cash or
surety bond. The word only in Articles 223 of the Labor Code makes it unmistakably plain that the
lawmakers intended the posting of a cash or surety bond by the employer to be the essential and
exclusive means by which an employers appeal may be perfected. The word may refers to the
perfection of an appeal as optional on the part of the defeated party, but not to the compulsory posting
of an appeal bond, if he desires to appeal. The meaning and the intention of the legislature in enacting a
 statute must be determined from the language employed; and where there is no ambiguity in the words
used, then there is no room for construction
Ibid; Requisites for reduction. The bond may be reduced upon motion by the employer, this is subject to
the conditions that (1) the motion to reduce the bond shall be based on meritorious grounds; and (2) a
reasonable amount in relation to the monetary award is posted by the appellant; otherwise, the filing of
the motion to reduce bond shall not stop the running of the period to perfect an appeal. The qualification
effectively requires that unless the NLRC grants the reduction of the cash bond within the 10-day
reglementary period, the employer is still expected to post the cash or surety bond securing the full
amount within the said 10-day period.
Ibid.; Appeal bond requirements is jurisdictional. Article 223, which prescribes the appeal bond
requirement, is a rule of jurisdiction and not of procedure. There is little leeway for condoning a liberal
interpretation thereof, and certainly none premised on the ground that its requirements are mere
technicalities. It must be emphasized that there is no inherent right to an appeal in a labor case, as it
arises solely from grant of statute, namely, the Labor Code. Non-compliance with such legal requirements
is fatal and has the effect of rendering the judgment final and executory. (Ramirez vs. CA, G.R. No. 182626,
December 4, 2009.)
4. Admissibility of evidence submitted for the first time on appeal. Indubitably, the NLRC is not precluded
from receiving evidence on appeal as technical rules of evidence are not binding in labor cases. There is,
however, a caveat to this policy. The delay in the submission of evidence should be clearly explained and
should adequately prove the employers allegation of the cause for termination.
Money claims; Prescription. Under Article 1139 of the Civil Code, actions prescribe by the mere lapse of
the time prescribed by law. That law may either be the Civil Code or special laws as specifically mandated
by Article 1148. In labor cases, the special law on prescription is Article 291 of the Labor Code which
provides

1. Permanent disability and Total disability; Meaning. Permanent disability is inability of a worker to perform
his job for more than 120 days, regardless of whether or not he loses the use of any part of his body.
Total disability, on the other hand, means the disablement of an employee to earn wages in the same kind
of work of similar nature that he was trained for, or accustomed to perform, or any kind of work which a
person of his mentality and attainments could do. It does not mean absolute helplessness. In disability
compensation, it is not the injury which is compensated, but rather it is the incapacity to work resulting in
the impairment of ones earning capacity. (Iloreta vs. Philippine Transmarine Carriers, Inc. et al., G.R. No.
183908, December 4, 2009.)
2. Dismissal based on grounds not alleged in the notice of termination not necessarily illegal.Although
petitioner was dismissed from work by the respondent on the ground of insubordination, this Court
cannot close its eyes to the fact that the ground of sexual abuse committed against petitioners
subordinate actually exists and was established by substantial evidence before the LA. The LA would be
rendered inutile if she would just seal her lips after finding that a just cause for dismissal exists merely
because the said ground was not stated in the notice of termination.
Sexual abuse by manager ground for termination. As a manager, petitioner enjoyed the full trust and
confidence of respondent and his subordinates. By committing sexual abuse against his subordinate, he
clearly demonstrated his lack of fitness to continue working as a managerial employee and deserves the
punishment of dismissal from the service.
Failure to observe procedural due process for termination entitles employee to nominal damages.
Nominal damages are adjudicated in order that a right of the plaintiff that has been violated or invaded
by the defendant may be vindicated or recognized, and not for the purpose of indemnifying the plaintiff
 for any loss suffered by him. Thus, for respondents violation of petitioners statutory rights, respondent is
sanctioned to pay petitioner nominal damages in the amount of P30,000.00. (Formantes vs. Duncan
Pharmaceuticals, G.R. No. 170661, December 4, 2009.)
3. Dismissal of corporate officer falls under the jurisdiction of regular courts not NLRC. A corporate officers
dismissal is always a corporate act, or an intra-corporate controversy which arises between a stockholder
and a corporation. The question of remuneration involving a stockholder and officer, not a mere
employee, is not a simple labor problem but a matter that comes within the area of corporate affairs and
management and is a corporate controversy in contemplation of the Corporation Code.
The determination of the rights of a director and corporate officer dismissed from his employment as well
as the corresponding liability of a corporation, if any, is an intra-corporate dispute subject to the
jurisdiction of the regular courts. (Okol vs. Slimmers World International, et al., G.R. No. 160146, December
11, 2009.)
4. Labor-only contracting; Pure supply of manpower to assist in sales and distribution of products is
prohibited as labor-only contracting. In plainer terms, the contracted personnel (acting as sales route
helpers) were only engaged in the marginal work of helping in the sale and distribution of company
products; they only provided the muscle work that sale and distribution required and were thus
necessarily under the companys control and supervision in doing these tasks.
Still another way of putting it is that the contractors were not independently selling and distributing
company products, using their own equipment, means and methods of selling and distribution; they only
supplied the manpower that helped the company in the handing of products for sale and distribution. In
the context of D.O. 18-02, the contracting for sale and distribution as an independent and self-contained
operation is a legitimate contract, but the pure supply of manpower with the task of assisting in sales and
distribution controlled by a principal falls within prohibited labor-only contracting. (Coca-cola Bottlers
Philippines vs. Dela Cruz, G.R. No. 184977, December 7, 2009.)
5. Suspension of labor-claims during corporate rehabilitation. Labor claims are included among the actions
suspended upon the placing under rehabilitation of employer-corporations. The law is clear: upon the
creation of a management committee or the appointment of a rehabilitation receiver, all claims for actions
shall be suspended accordingly. No exception in favor of labor claims is mentioned in the law. (Tiangco
vs. Uniwide Sales Warehouse Club, Inc., et al., G.R. No. 168697, December 14, 2009.)
Ibid.; Period or duration of the stay order. Petitioners seek to have the suspension of proceedings lifted on
the ground that the SEC already approved respondent USWCIs SARP. However, there is no legal ground
to do so because the suspensive effect of the stay order is not time-bound. The stay order continues to be
in effect as long as reasonably necessary to accomplish its purpose. (Tiangco vs. Uniwide, G.R. No. 168697,
December 14, 2009.)
6. Drug-Free Workplace Policy; Importance of confirmatory test after drug test. The importance of the
confirmatory test is underscored in Plantation Bays own Policy and Procedures, in compliance with
Republic Act No. 9165, requiring that a confirmatory test must be conducted if an employee is found
positive for drugs in the Employees Prior Screening Test, and that both tests must arrive at the same
positive result.
But where the confirmatory test results were released earlier than those of the drug test, the veracity of
the confirmatory results is put to doubt. (Plantation Bay Resort and Spa vs. Dubrico, et al., G.R. No.
182216, December 4, 2009.)
7. POEA Standard Employment Contract; Permanent disability defined. Permanent disability refers to the
inability of a worker to perform his job for more than 120 days, regardless of whether he loses the use of
any part of his body. What determines petitioners entitlement to permanent disability benefits is his
inability to work for more than 120 days.
Ibid; Right of seafarer to ask for second-opinion on the finding of fitness to work. The provision of POEA
Standard Employment Contract does not preclude the seafarer from getting a second opinion as to his
 condition for purposes of claiming disability benefits. While it is the company-designated physician who
must declare that the seaman suffers a permanent disability during employment, it does not deprive the
seafarer of his right to seek a second opinion, hence, the Contract recognizes the prerogative of the
seafarer to request a second opinion and, for this purpose, to consult a physician of his choice.
Ibid; Effect of failure of company designated physician to certify the seafarers fitness to work. Given a
seafarers entitlement to permanent disability benefits when he is unable to work for more than 120 days,
the failure of the company-designated physician to pronounce petitioner fit to work within the 120-day
period entitles him to permanent total disability benefit in the amount of US$60,000.00. (Abante vs. KJGS
Fleet Management Manila, G.R. No. 182430, December 4, 2009.)
8. POEA Standard Employment Contract; Compensation and benefits for injury or illness; Effect of failure of
seafarer to submit himself for medical examination within 3 days from repatriation. Even assuming that
petitioner was repatriated for medical reasons, he failed to submit himself to the company-designated
doctor in accordance with the post-employment medical examination requirement under paragraph 3 of
Section 20(B) of the POEA Standard Employment Contract. Failure to comply with this requirement which
is a sine qua non bars the filing of claim for disability benefits.
xxx

3. Upon sign-off from the vessel for medical treatment, the seafarer is entitled to sickness allowance
equivalent to his basic wage until he is declared fit to work or the degree of permanent disability has been
assessed by the company-designated physician but in no case shall this period exceed one hundred
twenty (120) days.

For this purpose, the seafarer shall submit himself to a post- employment medical examination by a
company-designated physician within three working days upon his return except when he is physically
incapacitated to do so, in which case, a written notice to the agency within the same period is deemed as
compliance. Failure of the seafarer to comply with the mandatory reporting requirement shall result in his
forfeiture of the right to claim the above benefits. If a doctor appointed by the seafarer disagrees with the
assessment, a third doctor may be agreed jointly between the Employer and the seafarer. The third
doctors decision shall be final and binding on both parties

xxx

(Musnit vs. Sea Star Shipping Corporation, G.R. No. 182623, December 4, 2009.)
9. Executory character of assumption and certification order. Assumption and certification orders are
executory in character and are to be strictly complied with by the parties, even during the pendency of
any petition questioning their validity. Regardless therefore of its motives, or of the validity of its claims,
the employer must readmit all striking employees and give them back their respective jobs. Accepting
back the workers is not a matter of option, but of obligation mandated by law for the employer to
faithfully comply with. Its compulsory character is mandated, not to cater to a narrow segment of society,
or to favor labor at the expense of management, but to serve the greater interest of society by
maintaining the economic equilibrium.
Ibid.; Implementation of return to work order cannot be made to depend upon the discretion of the
employer. Certainly, the determination of who among the strikers could be admitted back to work cannot
be made to depend upon the discretion of employer, lest we strip the certification or assumption-of-
jurisdiction orders of the coercive power that is necessary for attaining their laudable objective. The
return-to-work order does not interfere with the managements prerogative, but merely regulates it when,
in the exercise of such right, national interests will be affected. The rights granted by the Constitution are
not absolute. They are still subject to control and limitation to ensure that they are not exercised
arbitrarily. The interests of both the employers and employees are intended to be protected and not one
 of them is given undue preference. (YSS Employees Union vs. YSS Laboratories, Inc., G.R. No. 155125,
December 4, 2009.)

1. Due process cannot be dispensed with despite wider discretion in terminating managerial and
confidential employees. Although employers have wider latitude of discretion in terminating a managerial
employee, it is nonetheless settled that confidential and managerial employees cannot be arbitrarily
dismissed at any time, and without cause as reasonably established in an appropriate investigation. Such
employees, too, are entitled to security of tenure, fair standards of employment and the protection of
labor laws. Managerial employees, no less than rank-and-file laborers are entitled to due process.
Resignation; Definition. Resignation is the voluntary act of employees who are compelled by personal
reasons to disassociate themselves from their employment. It must be done with the intention of
relinquishing an office, accompanied by the act of abandonment. (Casa Cebuana Incorporada, et al. vs.
Leuterio, G.R. No. 176040, September 4, 2009.)
2. It is the employees burden to establish fact of dismissal. While the employer bears the burden in illegal
dismissal cases to prove that the termination was for valid or authorized cause, the employee must first
establish by substantial evidence the fact of dismissal from service. (Romero vs. Tri-Union International
Corp., G.R. No. 176700, September 4, 2009.)
3. Voluntary retirement distinguished from Involuntary retirement. Voluntary retirement cuts employment
ties leaving no residual employer liability; Involuntary retirement amounts to a discharge, rendering the
employer liable for termination without cause. The employees intent is the focal point of analysis. In
determining such intent, the fairness of the process governing the retirement decision, the payment of
stipulated benefits, and the absence of badges of intimidation or coercion are relevant parameters.
Employment contracts generally bind the parties to their terms; Exceptions. Although contracts executed
in the context of employment are imbued with public interest, triggering closer scrutiny, they remain
contracts binding the parties to their terms. To excuse the employees from complying with the terms of
their waivers, they must locate their case within any of three narrow grounds: (1) the employer used fraud
or deceit in obtaining the waivers; (2) the consideration the employer paid is incredible and unreasonable;
or (3) the terms of the waiver are contrary to law, public order, public policy, morals or good customs or
prejudicial to a third person with a right recognized by law. (Quevado, et al., vs. Benguet Electric
Cooperative, et al., G.R. No. 168927, September 11, 2009.)
4. Rules of procedure; Proper recourse from decision of the Court of Appeals. The proper recourse of an
aggrieved party to assail the decision of the Court of Appeals is to file a petition for review on certiorari
under Rule 45 of the Rules of Court. The Rules precludes recourse to the special civil action for certiorari if
appeal, by way of a petition for review is available, as the remedies of appeal and certiorari are mutually
exclusive and not alternative or successive. For a writ of certiorari to issue, a petitioner must not only
prove that the tribunal, board or officer exercising judicial or quasi-judicial functions has acted without or
in excess of jurisdiction but must also show that he has no plain, speedy and adequate remedy in the
ordinary course of law.
Burden of proof in termination cases. In termination cases, the burden of proof rests upon the employer
to show that the dismissal was for a just and valid cause and failure to discharge the same would mean
that the dismissal is not justified and therefore illegal.
Ibid.; Abandonment of work. To prove that the employee abandoned his work, it is incumbent upon the
employer to prove: (1) that the employee failed to report for work or had been absent without valid or
justifiable reason; and (2) that there must have been a clear intention to sever the employer-employee
relationship as manifested by some overt acts. The burden of proof to show that there was unjustified
refusal to go back to work rests on the employer. (Tacloban Far East Marketing Corporation, et al. vs.
Court of Appeals, et al., G.R. No. 182320, September 11, 2009.)
5. Sleeping on duty and leaving work area as serious misconduct. Sleeping on the job without prior
authorization was held to constitute serious misconduct and is a valid ground for dismissal. The court
considered that the employee in this case (Tomada) was directly responsible for a significant portion of
his employers property. Tomadas act was not merely a disregard company rules, but in effect an open
invitation for others to violate those same company rules.
Court denies financial assistance despite employees long years of service. Although his nearly two
decades of service might generally be considered for some form of financial assistance to shield him from
the effects of his termination, Tomadas acts reflect a regrettable lack of concern for his employer. If
length of service justifies the mitigation of the penalty of dismissal, then this Court would be awarding
disloyalty, distorting in the process the meaning of social justice and undermining the efforts of labor to
cleanse its ranks of undesirables. (Eduardo M. Tomada, Sr., RFM Corporation, et. al, G.R. No. 163270
September 11, 2009.)
6. Acceptance of award or benefit by individual members not a waiver of the unions claim. Union members
individual acceptance of the award and the resulting payments made by company does not operate as a
ratification of the DOLE Secretarys award; nor a waiver of their right to receive further benefits, or what
they may be entitled to under the law. Necessitous men are not, truly speaking, free men; but to answer a
present emergency, will submit to any terms that the crafty may impose upon them.
CBA signing bonus presupposes successful negotiation. A signing bonus is a grant motivated by the
goodwill generated when a CBA is successfully negotiated and signed between the employer and the
union. When no CBA was successfully negotiated by the parties, there shall be no basis to allow an award
of signing bonus.
N.B. In this case, the court awarded signing bonus because the petitioner failed to question the original
award of signing bonus despite unsuccessful negotiation. The court held thus: A bonus is a gratuity or act
of liberality of the giver; when petitioner filed the instant petition seeking the affirmance of the DOLE
Secretarys Order in its entirety, assailing only the increased amount of the signing bonus awarded, it is
considered to have unqualifiedly agreed to grant the original award to the respondent unions members.
(University of Santo Tomas vs. Samahang Manggagawa ng UST (SM-UST), G.R. No. 169940, September 14,
2009.)
7. Requisites of a valid Retrenchment (to prevent losses). In order to justify retrenchment of employees as a
measure to avoid or minimize business losses, the employer must satisfy certain established standards, all
of which must concur, viz.:
1. That retrenchment is reasonably necessary and likely to prevent business losses which, if already incurred,
are not merely de minimis, but substantial, serious, actual and real, or if only expected, are reasonably
imminent as perceived objectively and in good faith by the employer;
2. That the employer served written notice both to the employees and to the Department of Labor and
Employment at least one month prior to the intended date of retrenchment;
3. That the employer pays the retrenched employees separation pay equivalent to one (1) month pay or at
least one half (1/2) month pay for every year of service, whichever is higher;
4. That the employer exercises its prerogative to retrench employees in good faith for the advancement of
its interest and not to defeat or circumvent the employees right to security of tenure; and
5. That the employer used fair and reasonable criteria in ascertaining who would be dismissed and who
would be retained among the employees, such as status, efficiency, seniority, physical fitness, age, and
financial hardship for certain workers.
Decrease in revenue not necessary business losses within the meaning of Article 283. Sliding incomes or
decreasing gross revenues alone do not necessarily indicate business losses within the meaning of Article
283, for, in the nature of things, the possibility of incurring losses is constantly present in business
operations. The employer must prove the stringent requirement that the loss was substantial, continuing
and without any immediate prospect of abating.
 Retrenchment should only be resorted after less drastic measures have failed. Retrenchment should only
be resorted to when other less drastic means, such as the reduction of both management and rank-and-
file bonuses and salaries, going on reduced time, improving manufacturing efficiency, reduction of
marketing and advertising costs, faster collection of customer accounts, reduction of raw materials
investment and others, have been tried and found to be inadequate. (Bio Quest Marketing Inc., et al. vs.
Edmund Rey, G.R. No. 181503, September 18, 2009.)
8. POEA Standard Employment Contract; Seafarers who died during employment entitled to death benefits;
Exception. The general rule is that the employer is liable to pay the heirs of the deceased seafarer for
death benefits once it is established that he died during the effectivity of his employment contract.
However, the employer may be exempted from liability if he can successfully prove that the seafarers
death was caused by an injury directly attributable to his deliberate or willful act. (Great Southern
Maritime Services, Inc., et al. vs. Leonila Surigao, et al., G.R. No. 183646, September 18, 2009.)
9. Appeal from decision of Labor Arbiter; Appeal bond mandatory. The posting of a bond is indispensable to
the perfection of an appeal in cases involving monetary awards from the decision of the Labor Arbiter.
The lawmakers clearly intended to make the bond a mandatory requisite for the perfection of an appeal
by the employer as inferred from the provision that an appeal by the employer may be perfected only
upon the posting of a cash or surety bond.
Ibid.; Appeal bond also a jurisdictional requirement. The filing of the bond is not only mandatory but a
jurisdictional requirement as well, that must be complied with in order to confer jurisdiction upon the
NLRC. Non-compliance therewith renders the decision of the Labor Arbiter final and executory.
Ibid.; Purpose of appeal bond. Appeal bond is intended to assure the workers that if they prevail in the
case, they will receive the money judgment in their favor upon the dismissal of the employers appeal. It is
intended to discourage employers from using an appeal to delay or evade their obligation to satisfy their
employees just and lawful claims.
Ibid.; Requirements for reduction of appeal bond. The bond may be reduced upon motion by the
employer subject to the following conditions viz. (1) the motion to reduce the bond shall be based on
meritorious grounds; and (2) a reasonable amount in relation to the monetary award is posted by the
appellant, otherwise the filing of the motion to reduce bond shall not stop the running of the period to
perfect an appeal. (Andrew James Mcburnie vs. Eulalio Ganzon, et al., G.R. Nos. 178034 & 178117; G.R.
Nos. 186984-85, September 18, 2009.)
10. Entitlement to retirement benefits of previously resigned employees. Entitlement of employees to
retirement benefits must specifically be granted under existing laws, a collective bargaining agreement or
employment contract, or an established employer policy. In this case, no law or collective bargaining
agreement or other applicable contract, or an established company policy was existing during the
employees (respondents) employment entitling them to the P200,000 lump-sum retirement pay. The
company (petitioner) was not thus obliged to grant them such pay.
Binding effect of quitclaims executed by employees. While quitclaims executed by employees are
commonly frowned upon as being contrary to public policy and are ineffective to bar claims for the full
measure of their legal rights, where the person making the waiver has done so voluntarily, with a full
understanding thereof, and the consideration for the quitclaim is credible and reasonable, the transaction
must be recognized as being a valid and binding undertaking. (Kimberly-Clark Philippines, Inc. vs. Nora
Dimayuga, et al., G.R. No. 177705, September 18, 2009.)
11. Termination of employment; Abandonment; Burden of proof. Abandonment is a form of neglect of duty,
one of the just causes for an employer to terminate an employee. It is a hornbook precept that in illegal
dismissal cases, the employer bears the burden of proof. For a valid termination of employment on the
ground of abandonment, employer must prove, by substantial evidence, the concurrence of employees
failure to report for work for no valid reason and his categorical intention to discontinue employment.
(Odilon L. Martinez vs. B&B Fish Broker, G.R. No. 179985, September 18, 2009.)
12. POEA Standard Employment Contract; Disability benefit under Section 20(B); Requirements. A seafarer
may claim disability benefits under Section 20(B) of the 1996 POEA Standard Contract of Employment for
Seafarers (Contract) only if he suffers a work-related injury or illness during the term of his contract. In this
case, respondent admitted that he had been previously diagnosed with diabetes four years before he was
engaged by petitioners as chief cook of M/V White Arrow. Clearly, he was not afflicted with the said illness
only during the term of his contract but even prior to his employment. He did not even complain of any
complications of the disease at any time during his employment. Moreover, even assuming respondent
contracted the disease during the term of his contract, he was precluded from claiming disability benefits
for his failure to comply with Section 20(B)(3) of the Contract. The provision requires a claimant to submit
himself to a company-designated physician three days after his arrival in the Philippines for medical
examination and failure to do so bars the filing of a claim for disability benefits. Neither is respondent
entitled to disability benefits under Section 32-A of the Contract since diabetes is not one of the
compensable occupational diseases listed there. (Bandila Maritime Services, Inc., et al. vs. Rolando
Dubduban, G.R. No. 171984, September 29, 2009.)

1. Burden of proof to show dismissal for cause rest upon employer. It is a basic principle that in illegal
dismissal cases, the burden of proof rests upon the employer to show that the dismissal of the employee
is for a just cause and failure to do so would necessarily mean that the dismissal is not justified.
Abandonment of work cannot be presumed from equivocal acts. In claims of abandonment by an
employee, the settled rule is that the employer bears the burden of showing a deliberate and unjustified
refusal by the employee to resume his employment without any intention of returning. In evaluating a
charge of abandonment, the jurisprudential rule is that abandonment is a matter of intention that cannot
be lightly presumed from equivocal acts.
Elements of abandonment. To constitute abandonment, two elements must concur: (1) the failure to
report for work or absence without valid or justifiable reason, and (2) a clear intent, manifested through
overt acts, to sever the employer-employee relationship.
Filing of complaint for illegal dismissal with prayer for reinstatement negates claim of abandonment. In a
long line of cases, this Court has held that abandonment is negated where the immediate filing of a
complaint for illegal dismissal was coupled with a prayer for reinstatement and that the filing of the
complaint for illegal dismissal is proof enough of the desire to return to work. The prayer for
reinstatement, as in this case, speaks against any intent to sever the employer-employee relationship.
Award of attorneys fees in action for recovery of wages or illegal dismissal. It is settled that in actions for
recovery of wages or when the employee is illegally dismissed in bad faith or where an employee was
forced to litigate and incur expenses to protect his rights and interests by reason of the unjustified acts of
his employer, he is entitled to an award of attorneys fees. (Baron Public Theatrical, et al. vs. Normita
Peralta, et al., G.R. No. 170525, October 2, 2009.)
2. Elements of valid retrenchment. In order for a retrenchment scheme to be valid, all of the following
elements under Article 283 of the Labor Code must concur or be present, to wit:
1. That retrenchment is reasonably necessary and likely to prevent business losses which, if already incurred,
are not merely de minimis, but substantial, serious, actual and real, or if only expected, are reasonably
imminent as perceived objectively and in good faith by the employer;
2. That the employer served written notice both to the employees and to the DOLE at least one month prior
to the intended date of retrenchment;
3. That the employer pays the retrenched employees separation pay equivalent to one month pay or at least
one-half month pay for every year of service, whichever is higher;
4. That the employer exercises its prerogative to retrench employees in good faith for the advancement of
its interest and not to defeat or circumvent the employees right to security of tenure; and,
5. That the employer uses fair and reasonable criteria in ascertaining who would be dismissed and who
would be retained among the employees, such as status, efficiency, seniority, physical fitness, age, and
financial hardship for certain workers.
In the absence of one element, the retrenchment scheme becomes an irregular exercise of management
prerogative. The employers obligation to exhaust all other means to avoid further losses without
retrenching its employees is a component of the first element as enumerated above. To impart
operational meaning to the constitutional policy of providing full protection to labor, the employers
prerogative to bring down labor costs by retrenching must be exercised essentially as a measure of last
resort, after less drastic means have been tried and found wanting. (FASAP vs. PAL, G.R. No. 178083,
October 2, 2009.)
3. Position of a cashier requires high degree of trust and confidence. A position of trust and confidence has
been defined as one where a person is entrusted with confidence on delicate matters, or with the custody,
handling, or care and protection of the employers property and/or funds. One such position is that of a
cashier. A cashier is a highly sensitive position which requires absolute trust and honesty on the part of
the employee.
Ample reason to distrust sufficient basis to dismiss employee occupying position of trust and
confidence. The rule, therefore, is that if there is sufficient evidence to show that the employee occupying
a position of trust and confidence is guilty of a breach of trust, or that his employer has ample reason to
distrust him, the labor tribunal cannot justly deny the employer the authority to dismiss such employee.
(Eats-Cetera Food Services Outlet, et al. vs. Myrna B. Letran, et al., G.R. No. 179507, October 2, 2009.)
4. Subcontractual employees directed to continue their duty after termination of contract become employee
of the principal. With the conclusion that respondent [principal] directed petitioners [subcontractual
employees] to remain at their posts and continue with their duties, it is clear that respondent exercised
the power of control over them; thus, the existence of an employer-employee relationship. (Locsin, et al.
vs. PLDT, G.R. No. 185251, October 2, 2009.)
5. Mere absence of employee not sufficient to prove abandonment of work. Mere absence of petitioner is
not sufficient to establish the allegation of abandonment. The prolonged absence of petitioner was not
without justifiable reason because it was established that her failure to report for work was due to the
injury she suffered in the course of her employment and with sufficient notice to respondents. Petitioner
also presented herself for work on the date stated in the medical certificate which stated that she is fit to
resume work.
Burden of proof to show compliance with two notices requirement. In dismissing an employee, the
employer has the burden of proving that the dismissed worker has been served two notices: (1) the first to
inform the employee of the particular acts or omissions for which the employer seeks his dismissal, and
(2) the second to inform the employee of his employers decision to terminate him.
Ibid.; Where to serve notice in case of abandonment of work. In cases of abandonment of work, notice
shall be served at the workers last known address. (Tong Yak Groceries vs. Concepcion Faeldonia, et al.,
G.R. No. 182499, October 2, 2009.)
6. Nullification of a provision of CBA falls within the jurisdication of regular courts. The issue raised is
whether Section 144, Part A of the PAL-FASAP CBA is unlawful and unconstitutional. Here, the petitioners
primary relief is the annulment of Section 144, Part A of the PAL-FASAP CBA, which allegedly discriminates
against them for being female flight attendants. Where the principal relief sought is to be resolved not by
reference to the Labor Code or other labor relations statute or a collective bargaining agreement but by
the general civil law, the jurisdiction over the dispute belongs to the regular courts of justice and not to
the labor arbiter and the NLRC. In such situations, resolution of the dispute requires expertise, not in labor
management relations nor in wage structures and other terms and conditions of employment, but rather
 in the application of the general civil law. Clearly, such claims fall outside the area of competence or
expertise ordinarily ascribed to labor arbiters and the NLRC and the rationale for granting jurisdiction over
such claims to these agencies disappears.
Jurisdiction of labor tribunals limited to disputes arising from employer-employee relationship. Not every
dispute between an employer and employee involves matters that only labor arbiters and the NLRC can
resolve in the exercise of their adjudicatory or quasi-judicial powers. The jurisdiction of labor arbiters and
the NLRC under Article 217 of the Labor Code is limited to disputes arising from an employer-employee
relationship which can only be resolved by reference to the Labor Code, other labor statutes, or their
collective bargaining agreement. [Citing Georg Grotjahn GMBH & Co. v. Isnani, G.R. No. 109272, August
10, 1994.]
CBA not ordinary contract, but contract imbued with public interest. The relations between capital and
labor are not merely contractual. They are so impressed with public interest that labor contracts must
yield to the common good. The supremacy of the law over contracts is explained by the fact that labor
contracts are not ordinary contracts; these are imbued with public interest and therefore are subject to
the police power of the state. It should not be taken to mean that retirement provisions agreed upon in
the CBA are absolutely beyond the ambit of judicial review and nullification. A CBA, as a labor contract, is
not merely contractual in nature but impressed with public interest. If the retirement provisions in the CBA
run contrary to law, public morals, or public policy, such provisions may very well be voided. [Halaguea,
et al. vs. Philippine Airlines Inc., G.R. No. 172013, October 2, 2009.]
7. Requirements to justify retrenchment. To justify retrenchment, the employer must prove serious business
losses, and not just any kind or amount of loss. [The employer] should have produced its books of
accounts, profit and loss statements, and even its accountant to competently amplify its financial position.
Twin-notices requirement; Effect of failure to comply. The law requires that the employer must furnish the
worker sought to be dismissed with two written notices before termination of employment can be legally
effected: (1) notice which apprises the employee of the particular acts or omissions for which his dismissal
is sought; and (2) the subsequent notice which informs the employee of the employers decision to
dismiss him. Failure to comply with the requirements taints the dismissal with illegality. (Metro
Construction, et al. vs. Rogelio Aman, G.R. No. 168324, October 12, 2009.)
8. Fixing of retirement age. The age of retirement is primarily determined by the existing agreement or
employment contract. In the absence of such agreement, the retirement age shall be fixed by law.
Seafarers are contractual employees, not regular employees. Seafarers are considered contractual
employees. They cannot be considered as regular employees under Article 280 of the Labor Code. Their
employment is governed by the contracts they sign everytime they are rehired and their employment is
terminated when the contract expires. Their employment is contractually fixed for a certain period of time.
They fall under the exception of Article 280 whose employment has been fixed for a specific project or
undertaking the completion or termination of which has been determined at the time of engagement of
the employee or where the work or services to be performed is seasonal in nature and the employment is
for the duration of the season. (Citing Millares v. National Labor Relations Commission, 434 Phil. 524
[2002])
Ibid.; Not entitled to separation pay. Seafarers employment automatically ceased upon the expiration of
their contracts of enlistment (COE). Since there was no dismissal to speak of, it follows that they are not
entitled to reinstatement or payment of separation pay or backwages, as provided by law. (Eastern
Shipping Lines, Inc. vs. Ferrer, G.R. No. 171587, October 13, 2009, citing Millares, supra.)
9. Unborn child qualifies as dependent for the purpose of bereavement leave and other death
benefits. The CBA did not provide a qualification for the child dependent, such that the child must have
been born or must have acquired civil personality. Without such qualification, then child shall be
understood in its more general sense, which includes the unborn fetus in the mothers womb.
 CBA provisions for the benefit of the employee must be liberally interpreted. Bereavement leave and other
death benefits are granted to an employee to give aid to, and if possible, lessen the grief of, the said
employee and his family who suffered the loss of a loved one. Being for the benefit of the employee, CBA
provisions on bereavement leave and other death benefits should be interpreted liberally to give life to
the intentions thereof. Time and again, the Labor Code is specific in enunciating that in case of doubt in
the interpretation of any law or provision affecting labor, such should be interpreted in favor of labor.
(Continental Steel Manufacturing Corp. vs. Montao, et al., G.R. No. 182836, October 13, 2009.)
10. Misappropriation of funds amounts to serious misconduct. An employee who fails to account for and
deliver the funds entrusted to him is liable for misappropriating the same and is consequently guilty of
serious misconduct. (Superlines Transportation Company vs. Pinera, G.R. No. 188742, October 13, 2009.)
11. Strikers refusal to return to work for three years is a manifestation of intent to severe employment. In
petitioners case, despite the directive cum caveat of CASI for them to report back for work within two
days from receipt thereof, they failed to comply therewith. After three years, as reflected above, they
offered to return to work. Their intention to sever the employer-employee relationship with CASI is
manifested, however, by the length of time they refused to return to work, for they had, in the interim,
been looking for other jobs. (Miguel A. Pilapil, et al. vs. National Labor Relations Commission, et al., G.R.
No. 178229, October 23, 2009.)
12. Failure to appeal the monetary awards does not bar its modification on appeal. This Court notes that the
NLRC awarded backwages, 13th month pay, and service incentive leave pay from July 10, 2005 to January
23, 2007 only. It is evident that these should not be limited to said period. These should be computed
from the date of her illegal dismissal until this decision attains finality. Though Bolanos [the employee] did
not appeal the computation of the NLRCs award as affirmed by the Court of Appeals, we are not barred
from ordering its modification. This Court is imbued with sufficient authority and discretion to review
matters, not otherwise assigned as errors on appeal, if it finds that their consideration is necessary in
arriving at a complete and just resolution of the case or to serve the interests of justice or to avoid
dispensing piecemeal justice. Besides, substantive rights like the award of backwages, 13 th month pay and
service incentive leave pay resulting from illegal dismissal must not be prejudiced by a rigid and technical
application of the rules. The computation of the award for backwages and other benefits from the time
the compensation was withheld up to the time of actual reinstatement is a mere legal consequence of the
finding that respondent was illegally dismissed by petitioners. (Henlin Panay Company, et al. vs. NLRC, et
al., G.R. No. 180718, October 23, 2009.)