Century Canning Corp. v. Palad
REITERATIONFacts
The Antecedents: Gloria C. Palad (Palad) was hired by Century Canning Corporation (petitioner) as a "fish cleaner" and signed an apprenticeship agreement. Petitioner submitted its apprenticeship program for approval to TESDA, which was approved later. Petitioner claimed Palad was terminated due to poor performance and tardiness, citing a performance evaluation. Palad filed a complaint for illegal dismissal, underpayment of wages, and non-payment of 13th-month pay. Procedural History: The Labor Arbiter dismissed the illegal dismissal complaint but ordered petitioner to pay Palad's last salary and pro-rated 13th-month pay. The NLRC modified the decision, ordering payment of two months' backwages. The Court of Appeals set aside the NLRC decision, finding the dismissal illegal, ordering reinstatement with full backwages, attorney's fees, and costs, holding the apprenticeship agreement invalid due to lack of prior TESDA approval and finding Palad was not afforded due process. The Petition: Petitioner seeks review of the Court of Appeals' decision, questioning its findings that Palad was not an apprentice and that her termination was illegal.
Issue(s)
Whether the Court of Appeals committed reversible error in holding that private respondent was not an apprentice. Whether the Court of Appeals committed reversible error in holding that petitioner had not adequately proven the existence of a valid cause in terminating the service of private respondent.
Ruling
The petition is without merit. The Supreme Court affirmed the Decision of the Court of Appeals dated 12 November 2001 and the Resolution dated 5 April 2002 in CA-G.R. SP No. 60379.
Ratio Decidendi
On the issue of whether Palad was an apprentice: The Court held that the apprenticeship agreement was void because it was executed before the apprenticeship program was approved by TESDA. Citing Article 60 and 61 of the Labor Code and the ruling in Nitto Enterprises v. National Labor Relations Commission, the Court emphasized that prior approval of the apprenticeship program by the DOLE (now TESDA) is a condition sine qua non for the validity of an apprenticeship agreement. Since the agreement was enforced prior to TESDA's approval, Palad could not be considered an apprentice and was therefore a regular employee performing a necessary job for the company. The Court noted that Republic Act No. 7796 further clarified that an apprenticeship requires an "approved apprenticeable occupation" and an "Apprentice Agreement" which is a contract based on an "apprenticeship program duly approved by the Authority [TESDA]." The Court also pointed to Department Order No. 68-04, which explicitly states that no enterprise shall hire apprentices without TESDA registration and approval of its program. On the issue of illegal termination: The Court affirmed the Court of Appeals' finding that Palad's dismissal was illegal. The employer bears the burden of proving that termination was for a valid or authorized cause. Petitioner failed to substantiate its claim of poor performance, relying on a performance evaluation that the NLRC found to be of doubtful authenticity and credibility, being unauthenticated and potentially made belatedly. Furthermore, Palad was not afforded due process. Even if a performance evaluation was conducted, petitioner failed to show that Palad was warned of her alleged poor performance or that she was given an opportunity to explain or defend herself. The Court reiterated that valid dismissal requires both a just or authorized cause and adherence to the procedural requirements of notice and hearing. Since these requisites were not met, the dismissal was deemed illegal.
Main Doctrine
An apprenticeship agreement is void if executed before the apprenticeship program is approved by the TESDA, rendering the employee a regular employee. Dismissal requires just cause and due process, including notice and hearing, with the employer bearing the burden of proof.