Daza vs. Lugo

A probationary employee may be terminated for unsatisfactory conduct or want of capacity only when supported by substantial compliance with Civil Service rules requiring at least two supporting documents, including a Performance Evaluation Report prepared by the employee's immediate supervisor—not by the employee himself. Where no such report or other supporting documents are submitted, the termination is without just cause.

Respondent Ronan P. Lugo was appointed Sanitation Inspector I under permanent status by former Governor Madeleine P. Mendoza-Ong of Northern Samar on March 7, 2001, with the appointment approved by the CSC Provincial Field Office on March 20, 2001. Petitioner Raul A. Daza succeeded Mendoza-Ong as Governor and, as the appointing authority, issued directives governing the evaluation of probationary employees in the provincial government. The dispute centers on whether Daza validly terminated Lugo's probationary service during the six-month probationary period prescribed by the Revised Administrative Code of 1987 and Civil Service rules.

On March 7, 2001, former Governor Madeleine P. Mendoza-Ong of Northern Samar issued an appointment in favor of respondent Ronan P. Lugo as Sanitation Inspector I under permanent status. The CSC Provincial Field Office of Catarman, Northern Samar approved the appointment on March 20, 2001. As a newly appointed employee, Lugo was subject to a six-month probationary period under Civil Service rules.

Upon assuming office as the newly elected Governor, petitioner Raul A. Daza issued Memorandum No. 352-01 on August 10, 2001, directing all concerned office, department heads, and officers-in-charge to evaluate the performance of probationary employees under their respective supervisions. The memorandum reminded department heads that the probationary status of several employees would end in September or October 2001 and instructed each immediate supervisor to evaluate the concerned employees using the provincial government's performance evaluation rating system and to submit a report to the Governor on or before the end of August 2001, attaching the Performance Evaluation Report stating whether the employees were qualified to acquire permanent status.

On September 5, 2001, petitioner issued a memorandum informing respondent that his probationary service was terminated for unsatisfactory conduct, effective at the close of office hours on September 6, 2001, pursuant to the Governor's authority under Rule VII, Section 2 of the CSC Omnibus Rules Implementing Book V of Executive Order No. 292. No Performance Evaluation Report or other supporting document accompanied the notice of termination.

Respondent appealed the termination order to the CSC Regional Office VIII, which found the termination not in order for violating CSC Memorandum Circular No. 2, series of 1987, and CSC Memorandum Circular No. 42, series of 1989, and ordered reinstatement with back salaries and monetary benefits. Petitioner's motion for reconsideration was denied, and he elevated the matter to the CSC Commission Proper, which reversed the Regional Office and found the termination in order. Respondent then filed a petition for review with the Court of Appeals, which reversed the CSC and reinstated the Regional Office's order, finding that the termination was without basis because no Performance Evaluation Report had been submitted by respondent's supervisor and no other documents supported the finding of unsatisfactory conduct. The Court of Appeals noted that the Governor's memorandum was addressed to department heads, not to probationary employees, and that it was respondent's immediate supervisor who failed to evaluate and submit the required report.

• Due Process in Termination: Petitioner alleged that the CA erred in ruling that respondent was denied due process in the termination of his services, contending that under the provincial government's Revised Performance Evaluation System, each employee was required to prepare the prescribed Performance Evaluation Form (PEF-1), set performance standards and targets, and meet with the supervisor to discuss accomplishments and ratings, and that the employee also rates himself in the prescribed form.
• Employee's Duty to Submit Performance Evaluation Report: Petitioner asserted that respondent should have known he was required to submit his Performance Evaluation Report through his immediate supervisor and that respondent frustrated the performance rating process by not submitting the report, which was vital to determining his worthiness to continue in the service. Petitioner maintained that his memorandum to respondent's supervisor was merely a reminder that he did not even have to issue.
• Application of Miranda vs. Carreon: Petitioner contended that the CA erred in applying Miranda vs. Carreon to this case.

• Just Cause for Termination: Whether respondent's probationary services were terminated without just cause.
• Due Process: Whether respondent was denied due process in the termination of his services.
• Applicability of Precedent: Whether the CA erred in applying Miranda vs. Carreon to this case.

• Just Cause for Termination: Yes, the termination was without just cause. No Performance Evaluation Report was submitted by respondent's supervisor, and no other documents supported the finding of unsatisfactory conduct, rendering the termination baseless.
• Due Process: Yes, respondent was denied due process. The notice of termination was bereft of substantial compliance with Civil Service rules requiring supporting documents, and respondent was never apprised of any poor or unsatisfactory performance before being dismissed.
• Applicability of Precedent: No, the CA did not err in citing Miranda vs. Carreon. Although the case was not on all fours with the present dispute, its citation did not affect the finding that respondent's services were terminated without just cause.

• Just Cause for Termination: Under Section 26, paragraph 1, Chapter 5, Book V, Title I-A of the Revised Administrative Code of 1987, a probationer may be dropped from the service for unsatisfactory conduct or want of capacity any time before the expiration of the probationary period, provided such action is appealable to the Commission. Civil Service rules further require that the notice of termination be supported by at least two of the following: (a) a Performance Evaluation Report, (b) a report of the immediate supervisor on work-related critical and unusual incidents of unsatisfactory conduct, or (c) other valid documents. In this case, petitioner's Memorandum No. 352-01 was addressed to all concerned office, department heads, and OICs, directing the immediate supervisors to evaluate probationary employees and submit a report to the Governor. The memorandum did not direct probationary employees themselves to submit their own Performance Evaluation Reports. It was respondent's immediate supervisor who failed to evaluate and submit the required report. No other documents were presented to show that respondent's performance was unsatisfactory. The termination was therefore without basis.

• Due Process: The notice of termination issued by petitioner was not supported by any document and lacked proof of unsatisfactory conduct before the Performance Evaluation and Review Committee created for the purpose. Respondent was never apprised of any poor or unsatisfactory performance but was instantaneously dismissed without any basis. Even if the employee is allowed to rate himself in the Performance Evaluation Form, it is the supervisor's rating that is controlling, as it would be absurd for a probationary employee to evaluate his own performance. The duty to evaluate belongs to the concerned department head who has supervision over the employee. Petitioner erred in insisting that it was respondent's duty to submit the Performance Evaluation Report.

• Applicability of Precedent: Miranda vs. Carreon involved the termination of probationary employees after only three months of service instead of the required six months, and the CSC ordered their reinstatement with backwages because it was improbable that the office head could determine their performance after only three months. Although Miranda vs. Carreon is not on all fours with the present case, its application did not affect the independent finding that respondent's services were terminated without just cause. Reinstatement with backwages and other monetary benefits was accordingly warranted.

• Termination of Probationary Employees — A probationary employee may be dropped from the service for unsatisfactory conduct or want of capacity at any time before the expiration of the probationary period, provided the action is appealable to the CSC. The notice of termination must be supported by at least two of the following: (a) Performance Evaluation Report, (b) Report of the immediate supervisor on work-related critical and unusual incidents of unsatisfactory conduct, or (c) other valid documents. The Court applied this rule to find that the termination was baseless because no Performance Evaluation Report or supporting document was submitted.

• Duty to Evaluate Probationary Employees — The duty to evaluate the performance of a probationary employee belongs to the concerned department head or immediate supervisor who has supervision over the employee, not to the employee himself. While an employee may rate himself in the Performance Evaluation Form, the supervisor's rating is controlling. The Court applied this principle to reject petitioner's argument that respondent frustrated the evaluation process by failing to submit his own report.

• "[I]t is therefore evident that the finding of unsatisfactory conduct against petitioner (Lugo) is without basis. Aside from the fact there was no PER submitted by petitioner's immediate head to private respondent that would support such finding, there were also no other documents that would show that petitioner's performance as Sanitary Inspector I was inefficient or unsatisfactory." — This passage, quoted by the Court from the Court of Appeals' decision, articulates the core rationale: the absence of any Performance Evaluation Report or supporting document rendered the finding of unsatisfactory conduct baseless.

• "If indeed the manifestations of xxx Gov. Daza that the immediate supervisor of xxx Lugo failed to submit the required Performance Evaluation Report, is true, the statement therefore, that Lugo had committed 'unsatisfactory conduct' is without basis. For how can one claim unsatisfactory conduct when there was no submitted report detailing the same, which would serve as basis for such finding." — This passage from the CSC Regional Officer, quoted with approval by the Court, establishes the logical impossibility of finding unsatisfactory conduct without a supporting evaluation report.

• "Even if respondent is allowed to rate himself in the Performance Evaluation Form, it is the supervisor's rating that is controlling because, indeed, it would be absurd for a probationary employee to rate himself." — This passage defines the doctrine that the duty to evaluate a probationary employee rests with the immediate supervisor, not the employee, and that the supervisor's rating is the controlling assessment.

• Miranda vs. Carreon, G.R. No. 143540, April 11, 2003, 301 SCRA 303 — Cited by the Court of Appeals and discussed by the Supreme Court. The case involved termination of probationary employees after only three months instead of six, and the CSC ordered reinstatement with backwages. The Court found the case not on all fours with the present dispute but held that its citation did not affect the finding that respondent's termination was without just cause.

• Article IX-B, Section 2, paragraph 3, 1987 Constitution — Provides that no officer or employee of the civil service shall be removed or suspended except for cause provided by law. The Court invoked this provision as the constitutional basis for requiring just cause in the termination of a civil service employee, including a probationary one.

• Section 26, paragraph 1, Chapter 5, Book V, Title I-A, Revised Administrative Code of 1987 (Executive Order No. 292) — Provides that appointees who meet all requirements of the position must serve a probationary period of six months and undergo character investigation to acquire permanent status, and that a probationer may be dropped for unsatisfactory conduct or want of capacity before expiration of the probationary period, provided the action is appealable to the Commission. The Court applied this provision to confirm that termination of a probationary employee requires a just cause.

• Rule VII, Section 2, CSC Omnibus Rules Implementing Book V of Executive Order No. 292 — The provision cited by petitioner as authority for terminating respondent's probationary service. The Court found that the termination was not supported by the documents required under Civil Service rules governing notices of termination.

• CSC Memorandum Circular No. 2, series of 1987, and CSC Memorandum Circular No. 42, series of 1989 — Cited by the CSC Regional Office as the rules violated by the termination. The Regional Office found the termination not in order for violating these circulars.

Chief Justice Reynato S. Puno, Justice Leonardo A. Quisumbing (on official leave), Justice Consuelo Ynares-Santiago, Justice Antonio T. Carpio, Justice Ma. Alicia Austria-Martinez, Justice Renato C. Corona, Justice Conchita Carpio Morales, Justice Dante O. Tinga, Justice Minita V. Chico-Nazario, Justice Presbitero J. Velasco, Jr., Justice Antonio Eduardo B. Nachura, Justice Ruben T. Reyes, Justice Teresita J. Leonardo-De Castro, and Justice Arturo D. Brion. No separate concurring opinions were noted.