Dominador A. Almirante

Labor case digest

IN A case for illegal dismissal, the Court of Appeals found that the respondents were dismissed by the petitioner, Celebes Japan Foods Corp., for an authorized cause, but it failed to comply with the statutory requirement of due process. Thus, it ordered the company to pay each of the respondents nominal damages in the amount of P50,000.

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Celebes filed a motion for reconsideration praying for the reduction of the nominal damages awarded from P50,000 to P5,000, considering its financial condition. It submitted an audited financial statement and other documents showing that it incurred capital deficits. Did petitioner’s claim find merit?

Ruling: No.

The difference between Agabon and the instant case is that in the former, the dismissal was based on a just cause under Article 282 of the Labor Code, while in the present case, the respondents were dismissed due to retrenchment, which is one of the authorized causes under Article 283 of the same Code.

At this point, we note that there are divergent implications of dismissal for just cause under Article 282, on one hand, and a dismissal for authorized cause under Article 283, on the other.

A dismissal for just cause under Article 282 implies that the employee concerned has committed, or is guilty of, some violation against the employer, i.e. the employee has committed some serious misconduct, is guilty of some fraud against the employer, or, as in Agabon, he has neglected his duties.

Thus, it can be said that the employee himself initiated the dismissal process.

On another breath, a dismissal for an authorized cause under Article 283 does not necessarily imply delinquency or culpability on the part of the employee. Instead, the dismissal process is initiated by the employer’s exercise of his management prerogative, i.e., when the employer opts to install labor-saving devices, when he decides to cease business operations or when, as in this case, he undertakes to implement a retrenchment program.

Accordingly, it is wise to hold that: (1) if the dismissal is based on a just cause under Article 282 but the employer failed to comply with the notice requirement, the sanction to be imposed upon him should be tempered because the dismissal process was, in effect, initiated by an act imputable to the employee; and (2) if the dismissal is based on an authorized cause under Article 283 but the employer failed to comply with the notice requirement, the sanction should be stiffer because the dismissal process was initiated by the employer’s exercise of his management prerogative. (Celebes Japan Foods Corp. et al. vs. Susan Yermo et al., G.R. 175855, Oct. 2, 2009, quoting Jaka Food Processing Corp. v. Pacot, G.R. 151378, March 28, 2005, 454 Scra 119).