Consolidated Rural Bank (Cagayan Valley), Inc. v. National Labor Relations Commission
REITERATIONFacts
The Antecedents: Private respondent Antonia L. Sanchez, Branch Manager of petitioner Consolidated Rural Bank (CONSOLBANK)'s Ilagan Branch, was terminated effective August 7, 1993, for "lack of diligence, gross negligence, insubordination, and violation of existing bank policies resulting to loss." The termination stemmed from the deposit of six (6) US Treasury Warrants (USTW) totaling $13,966.74 (P335,201.76) by Rosalinda Rodriguez. Sanchez referred the checks to CONSOLBANK's Head Office, which accepted and deposited them for clearing. Upon notification of clearance, the Head Office withdrew the amount and used it as cash assistance, crediting the Ilagan Branch with interest. Rosalinda Rodriguez subsequently withdrew P314,000.00. Six months later, PCIBank informed CONSOLBANK that the USTWs had been dishonored for being altered, demanding P391,687.87. A fact-finding committee recommended a 30-day suspension for Sanchez, Head Office General Manager Ramon T. Cocson, and Treasury Department Manager Ginajane Espina. The committee found Sanchez liable for accepting dollar checks despite CONSOLBANK not being authorized to accept them, but mitigated her liability due to consulting Head Office and relying on its actions. Sanchez was asked to comment on charges of willful disobedience, including accepting the USTWs, allowing withdrawals before clearance, and denying instructions not to accept them. Sanchez denied knowledge of any policy against accepting dollar checks and stated her superiors accepted, deposited, and used the funds. She also denied authorizing withdrawals before clearance. An Executive Committee conducted further investigation, leading to the Board of Directors issuing Resolution No. 93-256 dismissing Sanchez. Procedural History: Private respondent sued CONSOLBANK for illegal dismissal, seeking reinstatement, back wages, benefits, and damages. The Labor Arbiter ruled in favor of Sanchez, finding her illegally dismissed, ordering reinstatement with full backwages and benefits, P500,000.00 in moral damages, and attorney's fees. The Labor Arbiter found that Sanchez could not be held liable as she referred the checks to Head Office, which accepted and deposited them. The alleged warning from General Manager Cocson was not given credence due to his subsequent actions. The dismissal was deemed tainted with bad faith, making Sanchez a scapegoat, and she was denied due process. CONSOLBANK appealed to the National Labor Relations Commission (NLRC), which affirmed the Labor Arbiter's decision. CONSOLBANK's motion for reconsideration was denied. The Petition: CONSOLBANK filed a special civil action for certiorari with the Supreme Court, assailing the NLRC resolutions on procedural and substantive grounds. Petitioner argued that the NLRC committed grave abuse of discretion by affirming the Labor Arbiter's decision rendered with "indecent haste" without further opportunity for petitioner to present evidence, and that the hearing where only private respondent was present was a "give-away." Petitioner prayed for the case to be remanded for further reception of evidence.
Issue(s)
Whether petitioner was denied procedural due process. Whether there was a valid cause for the dismissal of the private respondent. Whether the awards for backwages, separation pay, moral damages, and attorney's fees are proper.
Ruling
The petition is DISMISSED. The Resolutions of the NLRC dated 9 November 1995 and 30 January 1996 are AFFIRMED, with the clarification that the award of damages should be reckoned from August 7, 1993, the date of actual termination.
Ratio Decidendi
On the issue of procedural due process: The Court held that petitioner CONSOLBANK was not denied procedural due process. The absence of petitioner's counsel during a clarificatory hearing was attributed to its own fault and negligence, as notice was given, and the opposing counsel's absence did not automatically warrant a postponement. The Court reiterated that the holding of a hearing is discretionary with the Labor Arbiter, and parties cannot demand it as a matter of right. The New Rules of Procedure of the NLRC allow decisions based on position papers and supporting documents without a formal trial. Petitioner and private respondent had agreed to forego a formal trial and submit position papers and replies. Therefore, petitioner could not claim denial of due process. On the issue of valid cause for dismissal: The Court found no grave abuse of discretion on the part of the NLRC in concluding that the charges against private respondent were not substantially proved. Regarding "lack of diligence" and "gross negligence," the Court noted that Sanchez merely referred the checks to the Head Office, which ultimately accepted and deposited them. The alleged warning from a bank manager did not absolve the Head Office's decision. On the charge of violating bank policies, it was established that CONSOLBANK had no written policy against accepting dollar checks, and it was a tolerated practice. The charge of insubordination was disregarded because General Manager Cocson's actions, such as signing the memo crediting interest income, demonstrated his knowledge of the USTWs' acceptance. Other charges, like allowing withdrawals before clearance, were not substantiated and were not included in the Fact-Finding Committee's findings, thus they could not justify dismissal. On the issue of awards for backwages, separation pay, moral damages, and attorney's fees: The Court affirmed the awards. Backwages were correctly computed to include allowances and benefits like gasoline, car, and representation allowances, as these are considered benefits to the employee under Article 279 of the Labor Code. Separation pay was awarded based on Sanchez's twenty-two years of service, as petitioner failed to prove its incorporation date. The award of moral damages was justified because Sanchez was made a scapegoat, and her dismissal was arbitrary, with her being notified of termination retroactively and denied a copy of the Executive Committee's decision. The Court reiterated that moral damages are recoverable when dismissal is attended by bad faith or is contrary to morals, good customs, or public policy. Attorney's fees were also deemed justifiable, even if not explicitly claimed, as Sanchez was forced to litigate to protect her rights.
Main Doctrine
An employee dismissed for "lack of diligence, gross negligence, insubordination, and violation of existing bank policies resulting to loss" may be reinstated with full backwages, moral damages, and attorney's fees if the charges are not substantially proved and due process was denied. Allowances and benefits are included in the computation of backwages.