People's Security, Inc. and Nestor Racho vs. Flores and Tapiru Case Digest

People's Security, Inc. and Nestor Racho vs. Julius S. Flores and Esteban S. Tapiru

G.R. No. 211312. December 5, 2016

Facts

Julius S. Flores and Esteban S. Tapiru (respondents) were security guards previously employed by People's Security, Inc. (PSI). The respondents were assigned at the varfous facilities of Philippine Long Distance Telephone Company (PLDT) pursuant to a security services agreement between PSI and PLDT. On October 1, 2001, however, PSI's security services agreement with PLDT was terminated and, accordingly, PSI recalled its security guards assigned to PLDT including the respondents. On October 8, 2001, the respondents, together with several other security guards employed by PSI, filed a complaint for illegal dismissal with the National Labor Relations Commission (NLRC) against PLDT and PSI, claiming that they are PLDT employees.

Thereafter, PSI assigned the respondents to the facilities of its other clients such as the warehouse of a certain Marivic Yulo in Sta. Ana, Manila and Trinity College's Elementary Department in Quezon City.

Meanwhile, on January 13, 2003, the respondents were relieved from their respective assignments pursuant to Special Order No. 200310108 dated January 10, 2003 issued by Col. Leonardo L. Aquino, the Operations Manager of PSI.9 Accordingly, Flores and Tapiru, on September 6 and 27, 2005, respectively, filed with the Regional Arbitration Branch of the NLRC in Quezon City a complaint for illegal dismissal and non-payment of service incentive leave pay and cash bond, with prayer for separation pay, against PSI and its President Nestor Racho (Racho) (collectively, the petitioners).

In their position paper, the respondents claimed that, after they were relieved from their assignment in the warehouse in Sta. Ana, Manila on January 13, 2003, they repeatedly reported to PSI's office for possible assignment, but the latter refused to give them any assignment. On the other hand, the petitioners, in their position paper, claimed that the respondents were merely relieved from their assignment in the warehouse in Sta. Ana, Manila and that the same was on account of their performance evaluation, which indicated that they were ill-suited for the said assignment.

On January 30, 2009, the LA rendered a Decision finding that the respondents were illegally from their employment and, thus, directing the petitioners jointly and severally liable to pay the former separation pay and backwages.

On appeal, the NLRC, in its Decision dated April 14, 2010, reversed the LA Decision dated January 30, 2009. On April 25, 2013, the CA rendered the herein assailed Decision, reversing the NLRC's Decision dated April 14, 2010 and Resolution dated June 15, 2010. In finding that the respondents were illegally dismissed, the CA found that the petitioners failed to prove that the respondents had abandoned their work and that their defense of abandonment was negated by the filing of a case for illegal dismissal.

In this petition for review on certiorari, the petitioners claim that the CA committed reversible error in ruling that the respondents were illegally dismissed from their employment. They maintain that PSI never terminated the respondents' employment. On the contrary, they claim that the respondents freely and voluntarily resigned from their employment. They also claim that the CA erred when it ruled that they should be held jointly and solidarily liable to pay the respondents separation pay and backwages considering that there was absolutely no allegation or proof of participation, bad faith, or malice on the part of Racho in dealing with the respondents.

Issues:

1. Whether respondents were illegally dismissed.
2. Whether Racho is jointly and solidarily liable with PSI for the payment of the monetary awards to the respondents.

Rulings

1. Yes. a As rule, employment cannot be terminated by an employer without any just or authorized cause. No less than the 1987 Constitution in Section 3, Article 13 guarantees security of tenure for workers and because of this, an employee may only be terminated for just or authorized causes that must comply with the due process requirements mandated by law. Hence, employers are barred from arbitrarily removing their workers whenever and however they want.

There is no merit to the petitioners' claim that the respondents were not dismissed, but merely relieved from their respective assignments. While it is true that Special Order No. 20031010, which the petitioners issued to the respondents on January 13, 2003, indicated that the latter were merely relieved from the warehouse in Sta. Ana, Manila, such fact alone would not negate the respondents' claim of illegal dismissal. Indeed, the respondents pointed out that after they were relieved from their previous assignment, the petitioners refused to provide them with new assignment.

Further, as aptly ruled by the CA, the petitioners miserably failed to prove that the respondents abandoned their work. Abandonment is a matter of intention and cannot lightly be inferred or legally presumed from certain equivocal acts. For abandonment to exist, two requisites must concur: first, the employee must have failed to report for work or must have been absent without valid or justifiable reason; and second, there must have been a clear intention on the part of the employee to sever the employer-employee relationship as manifested by some overt acts. The Court is not convinced that the respondents failed to report for work or have been absent without valid or justifiable cause. After the petitioners relieved them from their previous assignment in Sta. Ana, Manila, the respondents were no longer given any assignment.

What is more, PSI did not afford the respondents due process. The validity of the dismissal of an employee hinges not only on the fact that the dismissal was for a just or authorized cause, but also on the very manner of the dismissal itself. It is elementary that the termination of an employee must be effected in accordance with law. It is required that the employer furnish the employee with two written notices: (1) a written notice served on the employee specifying the ground or grounds for termination, and giving to said employee reasonable opportunity within which to explain his side; and (2) a written notice of termination served on the employee indicating that upon due consideration of all the circumstances, grounds have been established to justify his termination.

Beyond dispute is the fact that no written notice was sent by PSI informing the respondents that they had been terminated due to abandonment of work. This failure on the part of PSI to comply with the twin-notice requirement, indeed, placed the legality of the dismissal in question, at the very least, doubtful, rendering the dismissal illegal.

2. No. Anent, the propriety of holding Racho, PSI's President, jointly and solidarily liable with PSI for the payment of the money awards in favor of the respondents, the Court finds for the petitioners. The doctrine of piercing the corporate veil applies only when the corporate fiction is used to defeat public convenience, justify wrong, protect fraud, or defend crime. In the absence of malice, bad faith, or a specific provision of law making a corporate officer liable, such corporate officer cannot be made personally liable for corporate liabilities. The respondents failed to adduce any evidence to prove that Racho, as President and General Manager of PSI, is hiding behind the veil of corporate fiction to defeat public convenience, justify wrong, protect fraud, or defend crime. Thus, it is only PSI who is responsible for the respondents' illegal dismissal.

WHEREFORE, in view of the foregoing disquisitions, the petition for review on certiorari is hereby DENIED. The Decision dated April 25, 2013 and Resolution dated February 7, 2014 of the Court of Appeals in CA-G.R. SP No. 115464 and the Decision dated January 30, 2009 of the Labor Arbiter are AFFIRMED with MODIFICATION in that petitioner Nestor Racho is held not solidarily liable with petitioner People's Security, Inc. for the payment of the monetary awards in favor of respondents Julius S. Flores and Esteban S. Tapiru.