Gutierrez vs. Singer Sewing Machine Company

The penalty of dismissal must be commensurate with the act, conduct, or omission imputed to the employee and imposed in connection with the employer's disciplinary authority. Even when an employee commits violations of company rules, the penalty of dismissal is unjustified, much too harsh, and quite disproportionate where the alleged infractions are minor in nature and the evidence adduced does not fairly show they fall exactly within the rules and regulations allegedly violated.

Petitioner Mario Gutierrez was an employee of Singer Sewing Machine Company, having been hired initially as Audit Assistant on a contractual basis in 1993, then becoming an Accounts Checker on probationary status on February 8, 1994, and acquiring regular status as Asset Auditor on March 1, 1995. The case involves the application of Article 282 of the Labor Code on just causes for termination, specifically serious misconduct or willful disobedience, and the constitutional mandate favoring the protection of labor. The dispute centers on whether the company's dismissal of Gutierrez for alleged violations of its Code of Discipline was valid and lawful.

Petitioner Mario Gutierrez was initially hired by Singer Sewing Machine Company as Audit Assistant on a contractual basis in 1993. He became an Accounts Checker on probationary status on February 8, 1994, and acquired regular status as Asset Auditor on March 1, 1995, receiving a monthly salary of P4,455, until September 9, 1996, when he was dismissed from employment.

Singer premised the petitioner's termination on two incidents. On August 1, 1996, at around 3:15 p.m., Ms. Emelita Garcia, Personnel Supervisor of Singer, caught Gutierrez and three other Asset Auditors watching a video tape inside the Asset/Legal Department Office. Despite Ms. Garcia's reminder that it was no longer break time and that the other occupants of the room might be disturbed, Gutierrez and company ignored Ms. Garcia and continued to watch the video. The following day, August 2, 1996, Ms. Evangeline Que-Ilagan, Administration Manager of Singer, noticed a sign posted at the door of the Asset/Legal Department Office which read "MAIPARIT TI UMISBO DITOY." When she asked who placed the sign at the door, Gutierrez admitted responsibility. When Ms. Que-Ilagan asked what it meant, Gutierrez answered, "BAWAL ANG UMIHI DITO" (No Urinating Here). Ms. Que-Ilagan then asked if Gutierrez had seen anyone urinate at the door where the sign was posted and the latter replied in the negative. When asked why he placed such a sign, Gutierrez replied, "Gusto ko, eh" (It is my pleasure). She admonished him not to do the same thing again and requested him to remove the sign, but Gutierrez refused to do so.

Later that same day, August 2, 1996, Gutierrez personally explained his side to the Asset Manager, Mr. Leonardo Consunji, at the latter's office. Gutierrez claimed that he only admitted to the posting of the sign in order to take the cudgels for a co-employee. He also explained that their use of the video equipment was upon the orders of their supervisor, Mr. Romeo C. Ninada, who wanted to test the quality of their video players. Mr. Consunji brought the matter to the attention of Mr. Ninada, who promptly issued a Memo dated August 6, 1996, requiring Gutierrez to explain his side. Gutierrez then informed Mr. Ninada that he had already discussed the matter with Mr. Consunji.

In his letter to Mr. Consunji dated August 21, 1996, Mr. Ninada opined that "[T]he case does not deserve to be devoted with too much time and effort" as he considered it a "minor offense." Nevertheless, Mr. Consunji issued a Memo dated August 28, 1996, informing Gutierrez of the latter's violation of company rules and regulations, specifically citing Part V-B.9 (Use of Company's time, materials, equipment and other assets for personal use or business) and Part V-B.18 (Acts of vandalism such as defacing or destroying Company documents and records; posting, altering or removing any printed matter, announcements or signs in the Bulletin Boards unless specifically authorized). Under the Company Code of Discipline, these infractions were classified as 4th Degree Offenses with the corresponding sanction of dismissal. In the same Memo, Gutierrez was directed to explain in writing why the aforesaid penalty should not be imposed on him, given until August 30, 1996, to comply. As Gutierrez insisted that he had previously verbally explained his side to Mr. Consunji, no written explanation was submitted by him.

On September 9, 1996, another Memo was issued by Mr. Consunji, stating that after a thorough investigation of the incident and after having found Gutierrez's explanations to be unsatisfactory and due to his refusal to comply with the memo dated August 28, 1996, which constituted willful defiance or disregard of Company authority, the management deemed it fitting and proper to impose upon him the penalty of dismissal effective immediately upon receipt thereof. On September 19, 1996, petitioner filed a motion/request for reconsideration with Singer, but the latter stood pat on its decision to dismiss him.

Singer's evidence against petitioner was based on three affidavits made by three of its employees: the affidavit of Mrs. Evangeline Que-Ilagan with respect to the "No Urinating Here" sign; the affidavit of Ms. Emelita Garcia, which narrated the details of the video-watching incident; and the sworn statement of Ms. Rosalina Orongan corroborating the affidavit of Ms. Garcia. Petitioner refuted the allegations, claiming that he only admitted authorship of the sign to bail out a co-employee who actually posted it, and that the video-watching was pursuant to instructions of their supervisor. The NLRC found that the affidavit of Ms. Ilagan was not sufficient to establish Gutierrez's guilt of vandalism, and that Gutierrez's claim regarding the video-watching was not denied by Mr. Ninada, who could have been easily required to negate the claim.

• Reliance on Affidavits: Petitioner argued that the Court of Appeals gravely erred in dismissing the complaint for illegal dismissal by relying solely on the affidavits submitted by respondents' employees, contrary to the NLRC's finding that these were biased and should not be given much weight and credit.
• Shifting of Burden of Proof: Petitioner argued that the Court of Appeals gravely erred in shifting the burden of proof upon the petitioner to prove his innocence from the alleged offense imputed by the respondents, contrary to existing jurisprudence.
• Disproportionate Penalty: Petitioner argued that the Court of Appeals gravely erred in sustaining the supreme penalty of dismissal notwithstanding the trivial nature of the infractions allegedly committed by the petitioner.

• Defiance of Authority: Singer averred that petitioner's defiance of the reasonable rules and regulations being implemented by Singer was enough reason for his dismissal.
• Challenging Authorities: Singer emphasized that the two violations of company rules and regulations on two consecutive days were manifestations that petitioner was "challenging the authorities of Singer."

• Procedural Due Process: Whether the appellate court erred in procedural and evidentiary matters, such as its alleged reliance on mere affidavits of respondents' employees and shifting the burden of proof to the petitioner, in violation of due process.
• Validity of Dismissal: Whether the appellate court erred in reversing the NLRC which declared respondents guilty of illegal dismissal of the petitioner from his employment.

• Procedural Due Process: No. Procedural due process was not violated by management. Singer complied with the two-notice requirement—first, of the intention to dismiss indicating the acts or omissions complained against, and second, of the decision to dismiss—and in between such notices, an opportunity for the employee to answer and rebut the charges.
• Validity of Dismissal: Yes. The appellate court erred in sustaining the dismissal. The penalty of dismissal was unjustified, much too harsh, and quite disproportionate to the alleged infractions, which were minor in nature and did not fall squarely within the cited company rules and regulations.

• Procedural Due Process: The requirements of due process are satisfied where the parties are afforded fair and reasonable opportunity to explain their respective sides of the controversy. Singer had provided petitioner ample opportunity to explain his side in writing after he was apprised of his alleged infractions. That he deemed his verbal explanation sufficient and opted to forego a written explanation was a choice he voluntarily made and insisted upon. The right to due process is not violated where a person is not heard because he or she has chosen not to give his or her side of the case—if one has the right to speak but chooses to be silent, he or she cannot complain of being unduly silenced.

• Validity of Dismissal: The Court agreed with the NLRC that petitioner's dismissal was unjustified and illegal. The NLRC correctly found that the questioned poster contained an innocuous and harmless statement, which when translated in Tagalog means "Bawal Umihi Dito," and that such posting cannot be interpreted as an act of vandalism. The affidavit of Ms. Ilagan was not sufficient to establish petitioner's guilt of vandalism. Regarding the video-watching, petitioner's claim that he and four other co-employees were asked by their immediate supervisor, Mr. Romy Ninada, to test the video tape player was not denied by Mr. Ninada, who was the logical officer to negate the claim. Mr. Ninada himself considered the same to be a minor infraction, not worth the time and effort of the company spent on the matter. The act of posting the sign does not fall squarely within the scope of the cited company rules and regulations, Part V-B.18, on vandalism, since the rule prohibits unauthorized posting "in the Bulletin Board," while the present case involved posting of a sign at one of the office doors, a different matter. Even on the assumption that Gutierrez in fact committed the cited infractions, they are not major violations but only minor ones which do not merit the supreme penalty of dismissal from employment. The Court cited the principle that extreme caution should be exercised in terminating the services of a worker, for his job may be the only lifeline on which he and his family depend for survival. The penalty of dismissal must be commensurate with the act, conduct, or omission imputed to the employee. The evidence adduced to prove the violations did not fairly show they fall exactly within the rules and regulations allegedly violated—the evidence did not square fully with the charges. The penalty imposed on the erring employee ought to be proportionate to the offense, taking into account its nature and surrounding circumstances. In the application of labor laws, the courts and other agencies of the government are guided by the social justice mandate in the fundamental law. To be lawful, the cause for termination must be a serious and grave malfeasance to justify the deprivation of a means of livelihood.

• Proportionality of Penalty in Termination Cases — The penalty of dismissal must be commensurate with the act, conduct, or omission imputed to the employee and imposed in connection with the employer's disciplinary authority. Even when there exist some rules agreed upon between the employer and employee on the subject of dismissal, the State can inquire into whether the rigid application of such rules would work too harshly on the employee. In this case, the Court applied this doctrine to find that the dismissal of petitioner for minor infractions—posting a sign and watching a video—was too harsh and disproportionate.

• Two-Notice Requirement in Procedural Due Process — The requirements of due process in termination cases are satisfied where the parties are afforded fair and reasonable opportunity to explain their respective sides of the controversy. This involves: (1) a notice of the intention to dismiss, indicating therein the acts or omissions complained against; (2) an opportunity for the employee to answer and rebut the charges; and (3) a notice of the decision to dismiss. In this case, the Court found that Singer complied with this requirement, and petitioner's voluntary choice to forego a written explanation did not constitute a violation of due process.

• Social Justice Mandate in Labor Cases — In the application of labor laws, the courts and other agencies of the government are guided by the social justice mandate in the fundamental law. Every doubt must be resolved in favor of the working class. To be lawful, the cause for termination must be a serious and grave malfeasance to justify the deprivation of a means of livelihood. The Court applied this doctrine in ruling that the dismissal was illegal because the infractions were minor and did not justify the extreme penalty of termination.

• "Extreme caution should be exercised in terminating the services of a worker for his job may be the only lifeline on which he and his family depend for survival in these difficult times. That lifeline should not be cut off except for a serious, just and lawful cause, for, to a worker, the loss of his job may well mean the loss of hope for a decent life for him and his loved ones." — This passage articulates the fundamental principle guiding the Court's review of termination cases, emphasizing the gravity of dismissing an employee and the need for a serious, just, and lawful cause.

• "But while [Clarete] may be guilty of violation of company rules, we find the penalty of dismissal imposed upon him by respondent [Caltex] too harsh and unreasonable. As enunciated in Radio Communications of the Philippines, Inc. v. National Labor Relations Commission, 'such a penalty (of dismissal) must be commensurate with the act, conduct or omission imputed to the employee and imposed in connection with the employer's disciplinary authority.'" — This passage, quoted from Caltex Refinery Employees Association v. NLRC, establishes the proportionality doctrine applied by the Court in finding the dismissal illegal.

• "The right to due process is not violated where a person is not heard because he or she has chosen not to give his or her side of the case - - if one has the right to speak chooses to be silent, he or she cannot complain of being unduly silenced." — This passage, quoted from the Court of Appeals' finding, articulates the principle that due process is not violated when an employee voluntarily chooses not to avail of the opportunity to be heard.

• St. Martin Funeral Homes vs. NLRC, G.R. No. 130866, September 16, 1998, 295 SCRA 494 — Cited as the basis for referring Singer's petition for certiorari to the Court of Appeals, establishing the procedure for judicial review of NLRC decisions.

• Pascua vs. NLRC, G.R. No. 123518, March 13, 1998, 287 SCRA 554 — Cited to support the two-notice requirement in termination cases, which the Court found was satisfied by Singer.

• Navarro III vs. Damasco, 316 Phil. 322 (1995) — Cited for the principle that the requirements of due process are satisfied where the parties are afforded fair and reasonable opportunity to explain their respective sides of the controversy.

• Manggagawa ng Komunikasyon sa Pilipinas vs. NLRC, G.R. No. 90173, February 27, 1991, 194 SCRA 573 — Cited for the principle that extreme caution should be exercised in terminating the services of a worker, as the job may be the only lifeline for the worker and his family.

• Caltex Refinery Employees Association (CREA) vs. NLRC, G.R. No. 102993, July 14, 1995, 246 SCRA 271 — Cited as controlling precedent for the doctrine that the penalty of dismissal must be commensurate with the act, conduct, or omission imputed to the employee, and that the State can inquire into whether rigid application of company rules would work too harshly on the employee.

• Radio Communications of the Philippines, Inc. vs. NLRC — Cited within Caltex for the principle that the penalty of dismissal must be commensurate with the act, conduct, or omission imputed to the employee.

• Gelmart Industries Phils., Inc. vs. NLRC, 176 SCRA 295 (1989) — Cited for the principle that even when there exist some rules agreed upon between the employer and employee on the subject of dismissal, the same cannot preclude the State from inquiring into whether its rigid application would work too harshly on the employee.

• Hongkong and Shanghai Banking Corp. vs. NLRC, G.R. No. 116542, July 30, 1996, 260 SCRA 49 — Cited for the principle that the Constitution and laws lean over backwards in favor of the working class, and every doubt must be resolved in their favor.

• Article 282(a), Labor Code — The provision on just causes for termination, specifically serious misconduct or willful disobedience. The Labor Arbiter found that petitioner's behavior fell within this provision, but the Supreme Court found that the alleged infractions were minor and did not justify dismissal.

• Article 282(e), Labor Code — The provision on analogous just causes for termination. The Labor Arbiter characterized Gutierrez's "undesirable or unreasonable behavior and unpleasant deportment with his fellow employees, all the more his supervisors," as within the scope of analogous just causes, but the Supreme Court found this insufficient to justify the extreme penalty of termination.

• Article 2217, Civil Code — The provision on moral damages. The Labor Arbiter found no necessity to discuss petitioner's prayer for damages for lack of factual and legal basis to apply this provision.

• Article 2229, Civil Code — The provision on exemplary damages. The Labor Arbiter similarly found no basis for applying this provision.

• Article 111, Labor Code — The provision on attorney's fees. The Labor Arbiter found no basis for awarding attorney's fees.

Bellosillo (Chairman), Austria-Martinez, Callejo, Sr., and Tinga, JJ., concurred.