Baron vs. EPE Transport, Inc.

The employer bears the burden of proving that an employee was not dismissed or, if dismissed, that the dismissal was not illegal; failure to discharge this onus means the dismissal was unjustified and therefore illegal. Abandonment requires two concurring elements: (a) failure to report for work or absence without valid or justifiable cause, and (b) a clear intention to sever the employer-employee relationship, with the second element being the more determinative factor, manifested by some overt acts.

Respondent EPE Transport Corporation, Inc. is a domestic corporation engaged in the operation of taxi units. Petitioners were employed as EPE's taxi drivers, paid on a boundary system, and were members of the EPE Transport, Inc. Drivers' Union-Filipinong Samahang Manggagawa (FSM), the exclusive bargaining agent of the taxi drivers in EPE. The employment relationship was governed by a Collective Bargaining Agreement (CBA) dated February 16, 2006, which provided for a grievance machinery for resolving disputes arising from the interpretation or implementation of the agreement.

Petitioners Fortunato R. Baron, Manolo B. Bersabal, and Recto A. Melendres were employed as taxi drivers of respondent EPE Transport Corporation, Inc., a domestic corporation engaged in the operation of taxi units, and were paid on a boundary system. They were members of the EPE Transport, Inc. Drivers' Union-Filipinong Samahang Manggagawa, the exclusive bargaining agent of the taxi drivers in EPE. Baron was hired on April 22, 2003, Melendres on February 18, 2003, and Bersabal on March 1, 2005.

Sometime in August 2008, Bersabal sought inquiry from the company regarding the boundary rates imposed, claiming that the same were not in accordance with the Collective Bargaining Agreement. Instead of clarifying the matter, Bersabal was purportedly told that he was free to go if he did not want to follow company policy, and that anyway, he had no more use to the company. As a result, Bersabal, together with the other EPE taxi drivers, filed on August 8, 2008, a complaint for violation of the CBA, unfair labor practice, refund of overcharged boundary, and money claims against EPE and its President, Ernesto P. Enriquez, docketed as NLRC Case No. NCR-08-11284-08 (CBA violation case).

Later in September 2008, Baron and Melendres equally questioned the company about the overcharging of boundary, for which they supposedly got the same response. Thus, they filed a complaint for unfair labor practice, refund of overcharged boundary, and attorney's fees against respondents, docketed as NLRC Case No. NCR-09-13285-08 (unfair labor practice case). Three days after, or on September 26, 2008, Baron claimed that he was no longer allowed to use his taxi unit and prevented from entering EPE's premises. Melendres and Bersabal allegedly suffered a similar fate on September 28, 2008 and October 1, 2008, respectively. Consequently, petitioners filed on October 6, 2008, another complaint, this time for illegal dismissal, unfair labor practice, separation pay, and attorney's fees, against respondents, docketed as NLRC Case No. NCR-10-13893-08 (illegal dismissal case).

Meanwhile, in an Order dated October 15, 2008, the complaint in the unfair labor practice case was dismissed without prejudice, and the case was recommended to be resolved before the grievance machinery. In response to the complaint in the illegal dismissal case, respondents denied that petitioners were dismissed, claiming that the latter themselves failed to return to work. Respondents claimed that petitioners were often called to explain their "shortages" and "damage to vehicle," as reflected in their employment records, with no intention of terminating their employment, and that after they filed separate complaints for violation of the CBA and unfair labor practice, petitioners suddenly went on absence without official leave (AWOL) and subsequently filed the instant suit.

• Illegal Dismissal: Petitioners asserted that they were unceremoniously dismissed after they charged respondents of violating the CBA before the NLRC, with Baron claiming he was no longer allowed to use his taxi unit and prevented from entering EPE's premises, and Melendres and Bersabal suffering a similar fate.
• Abandonment Negated: Petitioners argued that their filing of the illegal dismissal complaint shortly after they ceased working negated any suggestion of abandonment, as an employee who forthwith takes steps to protest his layoff cannot be said to have abandoned his work.
• Grievance Machinery: Petitioners maintained that their submission to the company's grievance machinery did not disprove illegal dismissal, since what was referred to the grievance machinery was the unfair labor practice case filed before they were terminated, which contains issues different and distinct from their cause of action for illegal dismissal.

• No Dismissal: Respondents denied that petitioners were dismissed, claiming that the latter themselves failed to return to work, and that petitioners were often called to explain their "shortages" and "damage to vehicle" with no intention of terminating their employment.
• Abandonment: Respondents claimed that after they filed separate complaints for violation of the CBA and unfair labor practice, petitioners suddenly went on absence without official leave (AWOL) and subsequently filed the instant suit.
• Grievance Machinery: Respondents pointed out that petitioners' agreement to seek redress before the company's grievance committee is inconsistent with their claim for illegal dismissal.

• Burden of Proof in Dismissal Cases: Whether the employer bears the burden of proving that an employee was not dismissed or that the dismissal was legal, even when the employer does not admit the dismissal.
• Abandonment of Work: Whether respondents sufficiently proved that petitioners abandoned their work, thereby justifying their termination.
• Effect of Resort to Grievance Machinery: Whether petitioners' submission to the company's grievance machinery disproves their claim of illegal dismissal.
• Grave Abuse of Discretion: Whether the CA erred in ruling that the NLRC gravely abused its discretion in finding petitioners to have been illegally dismissed.

• Burden of Proof in Dismissal Cases: Yes. The employer bears the burden of proving that the employee was not dismissed or, if dismissed, that the dismissal was not illegal, regardless of whether the employer admits or does not admit the dismissal, pursuant to Article 277(b) of the Labor Code.
• Abandonment of Work: No. Respondents failed to prove abandonment, as no evidence was adduced showing that petitioners' absence from work was deliberate and unjustified with a clear intent to sever the employment relationship.
• Effect of Resort to Grievance Machinery: No. Petitioners' submission to the grievance machinery does not disprove illegal dismissal, as what was referred was the unfair labor practice case filed before termination, which is distinct from the illegal dismissal cause of action.
• Grave Abuse of Discretion: No. The NLRC did not gravely abuse its discretion in finding illegal dismissal, as its pronouncement squares with existing legal principles; the CA committed reversible error in granting respondents' certiorari petition.

• Burden of Proof in Dismissal Cases: The Court cited a catena of cases holding that the onus of proving that an employee was not dismissed, or if dismissed, that the dismissal was not illegal, fully rests on the employer; failure to discharge such onus would mean that the dismissal was not justified and, therefore, illegal. This doctrine traces back to Barros vs. NLRC (1999) and was elucidated in Sevillana vs. I.T. (International) Corp. (2001), where the Court held that Article 277(b) of the Labor Code — which places upon the employer the burden of proving that the dismissal was for a valid or authorized cause — does not distinguish whether the employer admits or does not admit the dismissal. The Court applied the maxim that where the law does not distinguish, the court should not distinguish, and cited Article 4 of the Labor Code providing that all doubts in the implementation and interpretation of the Code shall be resolved in favor of labor. The employer must not rely on the weakness of the employees' evidence but must stand on the merits of their own defense.

• Abandonment of Work: The Court held that abandonment connotes a deliberate and unjustified refusal on the part of the employee to resume his employment, and that abandonment of work does not per se sever the employer-employee relationship — it is merely a form of neglect of duty, which is a just cause for termination. For a valid finding of abandonment, two elements must concur: (a) failure to report for work or absence without valid or justifiable cause; and (b) clear intention to sever the employer-employee relationship, with the second element as the more determinative factor, manifested by some overt acts. In this case, no proof was adduced by respondents to prove their theory of abandonment. Nothing on record would show that petitioners' absence from work was deliberate and unjustified with a clear intent to sever the employment relationship. On the contrary, such intention is belied by the fact that shortly after petitioners ceased from working, they immediately instituted the complaint for illegal dismissal. The Court noted that it would be illogical for petitioners to have left their job and thereafter seek redress by filing a complaint against their employer. Moreover, petitioners' prior filing of cases against respondents to correct perceived errors in the administration of the CBA bolsters the supposition that they actually desired to continue with their employment. The Court also observed that if respondents truly believed petitioners had abandoned their job, they could have sent notices or show-cause letters requiring them to report for work or explain their absences, but the records were bereft of any indication that respondents did so.

• Effect of Resort to Grievance Machinery: The Court clarified that petitioners' submission to the company's grievance machinery does not disprove illegal dismissal. What was referred to the grievance machinery was the unfair labor practice case filed by the petitioners before they were terminated, which contains issues that are different and distinct from their cause of action for illegal dismissal. The Court cited Article 223(c) of the Labor Code, as amended, which is explicit that the LA shall refer to the grievance machinery and voluntary arbitration, as provided in the CBA, those cases that involve the interpretation of said agreements. Further, Article 272 of the same Code provides that all unresolved grievances arising from the interpretation or implementation of the CBA, including violations of said agreement, are under the original and exclusive jurisdiction of the voluntary arbitrator or panel of voluntary arbitrators. As such, petitioners cannot be faulted in invoking the grievance machinery even after they had been dismissed in compliance with the provisions of the CBA, to which they were bound.

• Grave Abuse of Discretion: The Court held that to justify the grant of the extraordinary remedy of certiorari, the petitioner must satisfactorily show that the court or quasi-judicial authority gravely abused the discretion conferred upon it. Grave abuse of discretion connotes a capricious and whimsical exercise of judgment, done in a despotic manner by reason of passion or personal hostility, the character of which being so patent and gross as to amount to an evasion of positive duty or to a virtual refusal to perform the duty enjoined by or to act at all in contemplation of law. The NLRC's ruling cannot be equated to a capricious and whimsical exercise of judgment since its pronouncement of illegal dismissal squares with existing legal principles. Since petitioners' abandonment was not proven by respondents, the NLRC correctly ruled that the former were illegally dismissed, and the CA committed reversible error when it held otherwise.

• Burden of Proof in Illegal Dismissal Cases — The employer bears the burden of proving that an employee was not dismissed or, if dismissed, that the dismissal was not illegal; failure to discharge such onus means the dismissal was not justified and therefore illegal. This burden applies regardless of whether the employer admits or does not admit the dismissal, as Article 277(b) of the Labor Code does not distinguish between the two situations. The employer must not rely on the weakness of the employees' evidence but must stand on the merits of its own defense.

• Abandonment of Work — Abandonment connotes a deliberate and unjustified refusal on the part of the employee to resume his employment. For a valid finding of abandonment, two elements must concur: (a) failure to report for work or absence without valid or justifiable cause; and (b) clear intention to sever the employer-employee relationship, with the second element as the more determinative factor, manifested by some overt acts. Mere absence or failure to report for work is not tantamount to abandonment. The employer has the burden of proof to show a deliberate and unjustified refusal of the employee to resume employment without any intention of returning. The filing by an employee of a complaint for illegal dismissal is proof enough of his desire to return to work, thus negating any suggestion of abandonment.

• Grave Abuse of Discretion — Grave abuse of discretion connotes a capricious and whimsical exercise of judgment, done in a despotic manner by reason of passion or personal hostility, the character of which being so patent and gross as to amount to an evasion of positive duty or to a virtual refusal to perform the duty enjoined by or to act at all in contemplation of law. Grave abuse of discretion arises when a lower court or tribunal patently violates the Constitution, the law, or existing jurisprudence.

• "When the NLRC declared that the burden of proof in dismissal cases shifts to the employer only when the latter admits such dismissal, the NLRC ruled erroneously in disregard of the law and prevailing jurisprudence on the matter." — This passage, quoted from Sevillana vs. I.T. (International) Corp., establishes that the employer's burden of proof in dismissal cases applies regardless of whether the employer admits the dismissal, and is central to the Court's ruling that respondents bore the burden here.

• "For a valid finding of abandonment, two (2) elements must concur, namely: (a) the failure to report for work or absence without valid or justifiable cause; and (b) clear intention to sever the employer-employee relationship, with the second element as the more determinative factor and being manifested by some overt acts." — This is the canonical formulation of the abandonment doctrine, requiring both elements to concur, with the intent to sever the relationship being the more determinative factor.

• "An employee who forthwith takes steps to protest his layoff cannot, as a general rule, be said to have abandoned his work, for it is well-settled that the filing by an employee of a complaint for illegal dismissal is proof enough of his desire to return to work, thus negating any suggestion of abandonment." — This passage articulates the rule that filing an illegal dismissal complaint negates abandonment, which was determinative in the Court's finding that petitioners did not abandon their employment.

• Barros vs. NLRC, 373 Phil. 635 (1999) — Controlling precedent establishing the doctrine that the employer must prove by the quantum of evidence required by law that the employee was not dismissed, or if dismissed, that the dismissal was not illegal; otherwise, the dismissal would be unjustified.
• Sevillana vs. I.T. (International) Corp., 408 Phil. 570 (2001) — Followed; elucidated that Article 277(b) of the Labor Code places the burden of proving valid dismissal on the employer regardless of whether the employer admits or does not admit the dismissal.
• Dimagan vs. Dacworks United, Inc., 677 Phil. 472 (2011) — Cited for the proposition that absence must be accompanied by overt acts unerringly pointing to the fact that the employee simply does not want to work anymore, and that mere absence is not tantamount to abandonment.
• RBC Cable Master System and/or Cinense vs. Baluyot, 596 Phil. 729 (2009) — Cited for the rule that the employer has the burden of proof to show a deliberate and unjustified refusal of the employee to resume employment without any intention of returning.
• Eastern Shipping Lines, Inc. vs. POEA, 248 Phil. 762 (1988) — Cited for the principle that when the conflicting interests of labor and capital are weighed on the scales of social justice, the heavier influence of the latter must be counterbalanced by the sympathy and compassion the law must accord the underprivileged worker.

• Article 277(b), Labor Code (Presidential Decree No. 442) — Places upon the employer the burden of proving that the dismissal of an employee was for a valid or authorized cause; the Court held this provision does not distinguish whether the employer admits or does not admit the dismissal.
• Article 4, Labor Code — Provides that all doubts in the implementation and interpretation of the provisions of the Code, including its implementing rules and regulations, shall be resolved in favor of labor; applied to support the construction of Article 277(b) in favor of the employees.
• Article 223(c), Labor Code, as amended — Provides that the Labor Arbiter shall refer to the grievance machinery and voluntary arbitration, as provided in the CBA, those cases that involve the interpretation of said agreements; applied to show petitioners cannot be faulted for invoking the grievance machinery.
• Article 272, Labor Code — Provides that all unresolved grievances arising from the interpretation or implementation of the CBA, including violations of said agreement, are under the original and exclusive jurisdiction of the voluntary arbitrator or panel of voluntary arbitrators.
• Article 293, Labor Code, as amended — Provides for security of tenure, entitling an employee who is unjustly dismissed to reinstatement without loss of seniority rights and other privileges and to full backwages; basis for the award of separation pay in lieu of reinstatement.
• Section 1, Rule 45, Rules of Court — Provides that only questions of law may be raised in a petition for review on certiorari; the Court noted this limitation but recognized the exception for divergence in findings of fact between the LA/NLRC and the CA.

Sereno, C.J., Leonardo-De Castro, Bersamin, and Perez, JJ., concurred.