Cokia Industries Holdings Management, Inc. v. Bug-os

An employee who submits an apparently voluntary resignation letter and fails to substantiate allegations of harsh treatment or unbearable working conditions with evidence is not constructively dismissed, especially where the resignation occurs shortly after the employer requires the employee to explain discovered irregularities. The burden of proving constructive dismissal rests on the employee, and bare allegations are insufficient to establish it.

Bug-Os was employed as CIHMI's accounting personnel on January 2, 2001, tasked with preparing salary payrolls, vouchers, and contributions; processing loans and remittances to government agencies such as SSS, PhilHealth, and Pag-Ibig; and serving as liaison officer to various government agencies including the Department of Labor and Employment. In May 2015, following the death of Biange L. Co, Shirley L. Co replaced him as Corporate Finance Officer/Treasurer and, upon reviewing company documents, discovered a Pag-Ibig loan record in her name that she had never applied for. This discovery led to an investigation revealing forgeries and falsifications on the loan documents and on Pag-Ibig remittances, with the documents bearing Shirley's forged signature and that of Biange's.

Bug-Os was employed as CIHMI's accounting personnel on January 2, 2001. Her duties included preparing salary payrolls, vouchers, and contributions; processing loans and submitting remittances to government agencies such as SSS, PhilHealth, and Pag-Ibig; and serving as liaison officer and authorized representative to various government agencies, including the Department of Labor and Employment. In May 2015, upon the death of Biange L. Co, his sister Shirley L. Co replaced him as Corporate Finance Officer/Treasurer of CIHMI. Shirley reviewed company documents and discovered a Pag-Ibig loan record in her name, notwithstanding that she had never applied for one. After informing George Lee Co, CIHMI's President and Chief Operating Officer, of her discovery, they began investigating and uncovered several irregularities, including forgeries and falsifications on the Pag-Ibig loan supposedly obtained by Shirley and on the remittances to Pag-Ibig. The loan documents bore Shirley's forged signature and that of Biange's.

On July 4, 2015, George issued an Office Memorandum directing Bug-Os to explain three matters: (1) why she participated and connived in applying, processing, and securing a multi-purpose loan in Shirley's name; (2) why she lied and told Shirley that the latter did not have any loan with Pag-Ibig; and (3) why she attempted to cover up the fact that Shirley had an existing loan with Pag-Ibig that she never applied for. Bug-Os submitted her handwritten explanation on the same day, denying knowledge of the irregularities and attributing the forgery to Gina Co, her immediate supervisor and sister-in-law of George. Bug-Os claimed she merely prepared the loan forms and submitted them to Pag-Ibig.

Two days later, on July 6, 2015, Bug-Os tendered her resignation through a handwritten letter, effective at the close of office hours on the same day. The letter expressed gratitude for the opportunity to work with the company and bore no indication of coercion or complaint of false accusations. The following day, Bug-Os sent another handwritten letter authorizing her cousin, Corazon P. Etac, to withdraw her salaries, 13th month pay, and other amounts due her. On July 30, 2015, Etac received a check worth ₱9,163.50 covering Bug-Os' salary for July 1 to 6, 2015, 13th month pay, and proportionate service incentive leave pay. On August 11, 2015, Bug-Os filed a complaint for illegal dismissal against petitioners.

Petitioners presented evidence of irregularities committed by Bug-Os, including affidavits from Shirley, Lolita Perez (CIHMI's bookkeeper), and Edem Manlangit (another CIHMI employee). Perez enumerated three categories of irregularities: Bug-Os reported amounts for remittance to Pag-Ibig in excess of what was actually deducted from employees' salaries and credited the excess to her own loan; Bug-Os deducted amounts from other employees' salaries but credited them to the payment of her own loan and that of other persons; and Bug-Os reported amounts for remittance higher than what was actually deducted from her own salary. Manlangit affirmed that ₱5,000 was deducted from his salary but credited to Bug-Os' loan payment. Bug-Os admitted she was in charge of processing payroll, vouchers, loan applications, and remittances except for herself, but denied committing any irregularity and attributed them to Gina. A January 11, 2019 Judgment of the Municipal Trial Court in Cities of Cagayan de Oro City, Branch 5, convicted Bug-Os of six counts of estafa in relation to the Pag-Ibig remittances.

• Voluntary Resignation: Petitioners maintained that Bug-Os voluntarily resigned, as evidenced by her handwritten resignation letter which contained no indication of coercion, expressed gratitude for the opportunity to work, and made no mention of false accusations or harsh treatment.
• Lack of Proof of Constructive Dismissal: Petitioners argued that Bug-Os failed to substantiate her allegations of harsh treatment with evidence, and that bare allegations are insufficient to establish constructive dismissal.
• Evidence of Irregularities: Petitioners contended that they had presented evidence—including affidavits from Shirley, Perez, and Manlangit—proving that Bug-Os committed irregularities in Pag-Ibig and SSS remittances, supporting the conclusion that she resigned to avoid further questioning.
• Grave Abuse of Discretion: Petitioners asserted that the NLRC and CA committed grave abuse of discretion in finding constructive dismissal despite the lack of evidence supporting Bug-Os' claims.

• Constructive Dismissal: Respondent countered that she was forced to resign because petitioners subjected her to harsh words and treatment, including George giving orders in a high-pitched voice, forcing her to run when given orders, directing her to do tasks despite being busy with payroll, and making her feel like a slave.
• No Real Intention to Resign: Respondent argued that her act of filing a complaint for illegal dismissal showed she had no real intention to give up her employment.
• Denial of Irregularities: Respondent maintained that she had no knowledge of the irregularities and attributed the forgery to Gina Co, claiming she merely prepared the loan forms and submitted them to Pag-Ibig.

• Constructive Dismissal: Whether the CA erred in affirming the NLRC's finding that Bug-Os was illegally dismissed, i.e., whether Bug-Os was constructively dismissed or had voluntarily resigned.

• Constructive Dismissal: No. Bug-Os was not constructively dismissed; she voluntarily resigned. Her resignation letter bore no indicia of coercion, her allegations of harsh treatment were unsubstantiated by evidence, and the two-day interval between the Office Memorandum and her resignation was inconsistent with a claim that working conditions had become unbearable.

• Constructive Dismissal: Constructive dismissal exists when an act of clear discrimination, insensibility, or disdain by an employer becomes so unbearable that the employee is foreclosed from any choice except to forego continued employment. The test is whether a reasonable person in the employee's position would feel compelled to give up employment under the prevailing circumstances. Resignation, by contrast, is the voluntary act of an employee who believes personal reasons cannot be sacrificed in favor of the exigency of the service. The acts of the employee before and after the alleged resignation must be considered in determining whether the employee intended to sever employment. While the employer bears the burden of proving voluntary resignation, the employee bears the burden of proving constructive dismissal, especially when the employee has given a resignation letter.

Applying these principles, the Court found Bug-Os' resignation letter, on its face, devoid of any indication of coercion. She made no mention of false accusations and expressed gratitude, which undermined her assertion of being forced to resign. Her claims of harsh treatment were unsupported by evidence; bare allegations are insufficient to establish constructive dismissal. Perez, CIHMI's bookkeeper, and Bug-Os herself confirmed that she had never been scolded or subjected to disciplinary action prior to the discovery of the irregularities. Perez further refuted Bug-Os by averring that George scolded her only once, in relation to the irregularities. The Court noted that strong words from an employer do not necessarily render the working environment unbearable unless uttered without palpable reason or for the purpose of degrading the employee's dignity. Bug-Os did not cite any specific demeaning statements by George, making it impossible to determine whether his words made working conditions unbearable or simply expressed anger over misappropriated funds. The Court found it incredulous that in the two-day span from July 4 to July 6, 2015, Bug-Os was subjected to so much harassment as to make working for CIHMI unbearable. The evidence of irregularities presented by petitioners, corroborated by multiple employees, and the Municipal Trial Court's conviction of Bug-Os for six counts of estafa, further supported the conclusion that she resigned on her own volition, perhaps to avoid further questioning. Because the Labor Arbiter, NLRC, and CA had conflicting factual findings, the Court undertook a review of the record and concluded that the Labor Arbiter was correct in dismissing the complaint.

• Constructive Dismissal — Constructive dismissal exists if an act of clear discrimination, insensibility, or disdain by an employer becomes so unbearable on the part of the employee that it could foreclose any choice by him or her except to forego continued employment. The test is whether a reasonable person in the employee's position would feel compelled to give up employment under the prevailing circumstances. The Court applied this doctrine by examining whether Bug-Os' working conditions were truly unbearable, and found they were not, given the absence of evidence of sustained harassment and the short two-day period between the memorandum and her resignation.

• Voluntary Resignation — Resignation is the voluntary act of an employee who is in a situation where one believes that personal reasons cannot be sacrificed in favor of the exigency of the service, and one has no other choice but to dissociate oneself from employment. The acts of the employee before and after the alleged resignation must be considered in determining whether the employee in fact intended to sever employment. The Court found that Bug-Os' resignation letter, her authorization of a cousin to claim her final pay, and the absence of any protest in her resignation letter all indicated voluntary resignation.

• Burden of Proof in Constructive Dismissal Cases — The employer has the burden of proving that an employee voluntarily resigned, but the employee bears the burden of proving constructive dismissal, especially when he or she has given a resignation letter. Bare allegations alone are insufficient to establish constructive dismissal. The Court held that Bug-Os failed to discharge her burden, as she presented no evidence beyond unsubstantiated claims of harsh treatment.

• Strong Words and Hostile Work Environment — Strong words from an employer do not necessarily make the working environment unbearable. A hostile work environment is created only when such words are uttered without palpable reason or are expressed for the purpose of degrading the dignity of the employee. The Court found that Bug-Os did not cite specific demeaning statements by George, and that any expressions of anger were plausibly directed at the discovered misappropriation of company funds.

• "Constructive dismissal exists if an act of clear discrimination, insensibility, or disdain by an employer becomes so unbearable on the part of the employee that it could foreclose any choice by him or her except to forego his or her continued employment." — This passage states the canonical definition of constructive dismissal applied in the case, establishing the standard against which Bug-Os' claims were measured.

• "The test for determining if an employee was constructively dismissed is whether a reasonable person in the employee's position would feel compelled to give up his or her employment under the prevailing circumstances." — This formulation of the objective test for constructive dismissal was the analytical framework the Court used to evaluate whether Bug-Os' resignation was truly coerced.

• "It is incredulous that in that short span of time, she was subjected to so much harassment that it made working for CIHMI unbearable." — This passage captures the Court's assessment that the two-day interval between the Office Memorandum and Bug-Os' resignation fatally undermined her claim of constructive dismissal, as the brevity of the period was inconsistent with the development of unbearable working conditions.

• "Bare allegations alone are insufficient to establish constructive dismissal." — This statement articulates the evidentiary standard required of employees claiming constructive dismissal, particularly where a resignation letter has already been submitted.

• Que vs. Asia Brewery, Inc., G.R. No. 202388, April 10, 2019 — Cited for the definition of constructive dismissal as an act of clear discrimination, insensibility, or disdain by an employer that becomes so unbearable as to foreclose any choice by the employee except to forego continued employment.

• Peñaflor vs. Outdoor Clothing Manufacturing Corp., 632 Phil. 219 (2010) — Cited for the test of whether a reasonable person in the employee's position would feel compelled to give up employment under the prevailing circumstances.

• Pascua vs. Bank Wise, Inc., G.R. Nos. 191460 & 191464, January 31, 2018 — Cited for the definition of resignation as a voluntary act and the principle that the employee's acts before and after the alleged resignation must be considered.

• Gan vs. Galderma Philippines, Inc., 701 Phil. 612 (2013) — Cited for the rule that an allegation of constructive dismissal must be proven by the employee, especially when he or she has given a resignation letter to the employer.

• FCA Security and General Services, Inc. vs. Academia, Jr. II, G.R. No. 189493, August 2, 2017 — Cited for the allocation of burdens: the employer must prove voluntary resignation, but the employee must prove constructive dismissal.

• Lu vs. Enopia, 806 Phil. 725 (2017) — Cited for the principle that while the Court generally does not review factual findings of lower tribunals, conflicting findings of the Labor Arbiter, NLRC, and CA justify such review.

• Philippine Span Asia Carriers Corp. vs. Pelayo, G.R. No. 212003, February 28, 2018 — Cited for the principle that strong words from an employer do not necessarily make the working environment unbearable unless uttered without palpable reason or for the purpose of degrading the employee's dignity.

• Revenue Memorandum Circular No. 39-2012 — Referenced in the NLRC's December 29, 2016 Resolution regarding the 5% withholding tax on the award of backwages, 13th month pay, and service incentive leave pay for employees who are not minimum wage earners. This provision was part of the NLRC's monetary award that was ultimately set aside by the Supreme Court's reversal.

Leonen, J. (Chairperson), Gesmundo, J., Carandang, J., Lazaro-Javier, J., and Zalameda, J., concurred. (Gesmundo, J. was on official leave; Lazaro-Javier, J. was designated as Additional Member of the Third Division per Special Order No. 2728 dated October 25, 2019.)