Batangas Laguna Tayabas Bus Company (bltb Co.) v. National Labor Relations Commission, Librado Aquino And Eufemio Bondad
REITERATIONFacts
1. The Antecedents: Private respondents Librado Aquino and Eufemio Bondad, bus conductors for petitioner Batangas Laguna Tayabas Bus Company (BLTB Co.), were among 36 employees detained by the military in December 1973 for alleged involvement in defrauding the company of P186,169.30 between February and November 1973. Following military investigation and subsequent transfer to civil courts, an estafa case was filed against them, which remained pending at the time of this petition. 2. Procedural History: After their temporary release on May 7, 1974, Aquino and Bondad filed a complaint for illegal dismissal and violation of Presidential Decree No. 21 with the Department of Labor. This case was submitted for voluntary arbitration but remained unresolved. Subsequently, on April 8, 1981, they filed a new complaint for illegal dismissal with the labor arbiter, alleging refusal of work assignments since 1974. The labor arbiter ordered BLTB Co. to pay backwages and separation pay, a decision affirmed by the National Labor Relations Commission (NLRC) on December 5, 1984. 3. The Petition: This case comes before the Supreme Court via a special civil action for certiorari, seeking to annul the NLRC's decision. Petitioner BLTB Co. argues that the NLRC committed grave abuse of discretion in ruling that private respondents were illegally dismissed. The core of the petition is that while the NLRC found a lack of due process and just cause, the company contends that the estafa charges and preliminary investigation constituted substantial evidence of fraud and breach of trust, justifying termination, and that the clearance requirement was not met, warranting modification of the award.
Issue(s)
Whether the public respondent NLRC committed grave abuse of discretion in ruling that private respondents Aquino and Bondad were illegally dismissed; and whether there was a just cause for the termination of private respondents' employment. Whether BLTB Co. complied with the procedural requirements for termination, specifically the clearance requirement.
Ruling
The Supreme Court modified the decision of the NLRC. It deleted the award of backwages but affirmed the award of separation pay. BLTB Co. was ordered to pay private respondents separation pay equivalent to 1/2 month pay for every year of service, computed from their respective dates of employment up to December 1974, when they were deemed separated.
Ratio Decidendi
On the issue of illegal dismissal and just cause: The Court found that while the NLRC stated that BLTB Co. failed to adduce evidence of guilt and that private respondents were deprived of due process, the Court disagreed. The Court held that by the nature of their work as bus conductors, BLTB Co. reposed trust and confidence in them. The filing of criminal charges for estafa against private respondents and 34 other employees constituted prima facie evidence of their involvement in defraudation, which is a recognized cause for termination based on fraud or wilful breach of trust. The Court clarified that an employer need not await final conviction in a criminal case before terminating an employee for such acts, and even acquittal does not preclude dismissal for acts inimical to the employer's interests. The Court considered the criminal charges and the preliminary investigation's finding of prima facie guilt as substantial evidence sufficient to warrant a finding of just cause for termination based on loss of trust and confidence. The Court also found that private respondents were afforded due process, as the preliminary investigation by the Judge Advocate General's Office and the city fiscal's office provided a basis for the company's action, and their release from detention was due to posting bail, not necessarily proof of innocence. On the issue of procedural compliance (clearance requirement): Despite finding a just cause for dismissal, the Court held that BLTB Co. failed to comply with the clearance requirement under Section 11 of P.D. 21, which mandated written clearance from the Secretary of Labor for the termination of regular employees with at least one year of service. The Court deemed this failure as a procedural defect. However, to adjudge BLTB Co. liable for both backwages and separation pay would be unduly harsh under the circumstances. Applying the principle in Victoria v. Inciong, the Court found payment of separation pay to be equitable. The Court also clarified that the separation was deemed effective in December 1974, aligning with the period when the employees were effectively removed from service due to the charges, rather than April 8, 1981, the date of the second labor complaint.
Main Doctrine
While fraud or wilfull breach of trust is a valid cause for termination, an employer must still comply with the procedural requirement of obtaining a clearance to terminate employment, failing which, separation pay may be awarded even if dismissal is for a just cause.