Before an employer bears the burden of proving that a dismissal was for a valid or authorized cause, the employee must first establish by substantial evidence the fact of dismissal from service; bare allegations of constructive dismissal, uncorroborated by evidence, cannot be given credence.

Virgilio Pulgar was the manager of PRRM's Tayabas Bay Field Office (TBFO). Following his reassignment to PRRM's central office, an investigation was conducted into alleged financial anomalies at the TBFO. The investigation report indicated missing or improperly accounted funds and the submission of fictitious receipts. Pulgar was asked to explain these findings.

• Virgilio Pulgar was the manager of PRRM's Tayabas Bay Field Office (TBFO) and was investigated for alleged financial anomalies, including missing funds and fictitious receipts.
• In a letter dated February 24, 1997, Pulgar admitted that TBFO's reported expenses did not reflect actual expenses, explaining he used funds intended for one project for others and submitted non-genuine receipts to meet deadlines.
• Pulgar disclosed opening a separate bank account for TBFO's savings under his name at Capitol Bank (later clarified as Cooperative Bank of Quezon), with a balance of P206,958.50 (later P207,693.10).
• While the investigation was ongoing, Pulgar went on leave on March 3-10, March 20-25, and April 1-15, 1997.
• Pulgar alleged that on March 31, 1997, he was not allowed to enter PRRM premises and his personal properties were removed from his office.
• On April 3, 1997, while still on approved leave (April 1-15, 1997), Pulgar filed a complaint for illegal dismissal against PRRM.
• Pulgar continued to receive his salary from PRRM until April 15, 1997, when his vacation and sick leaves were consumed.
• Pulgar presented photographs of a storage room with sealed boxes, claiming they contained his personal effects, as proof of constructive dismissal.

• PRRM argued that it did not dismiss Pulgar; rather, Pulgar chose not to return to work after his leave of absence to evade criminal liability from the ongoing investigation into financial anomalies.
• PRRM contended that Pulgar filed the illegal dismissal case as a diversionary tactic to avoid submitting himself to the investigation.
• PRRM requested the Supreme Court to order Pulgar to return the PRRM funds (P207,693.10) still in his custody.

• Pulgar claimed he was constructively dismissed when he was allegedly barred from entering PRRM premises on March 31, 1997, and his personal effects were removed from his office.
• Pulgar argued that the filing of an illegal dismissal complaint is inconsistent with the charge of abandonment.
• Pulgar asserted that the Labor Arbiter's factual finding of illegal dismissal should be respected, as the Arbiter had the opportunity to observe the parties.
• Pulgar contended that PRRM could no longer claim the funds in his possession because the Labor Arbiter had ruled PRRM failed to raise this as a relief in its Position Paper, and PRRM did not appeal this part of the decision.

• Whether the Court of Appeals erred in ruling that Pulgar was illegally dismissed from employment.
• Whether PRRM is entitled to the return of the funds held by Pulgar.

• The Supreme Court granted PRRM's petition, reversing the CA decision and reinstating the NLRC decision which dismissed Pulgar's complaint.
• The Court found that Pulgar failed to establish by substantial evidence the fact of his dismissal, as his claim of being barred from the premises was a bare allegation lacking specific details or proof.
• The photographs presented by Pulgar did not prove that the boxes contained his personal items or that he was constructively dismissed.
• Pulgar's filing of an application for leave for April 1-15, 1997, after the alleged date of constructive dismissal (March 31, 1997), contradicted his claim of having been dismissed.
• Pulgar filed the illegal dismissal complaint on April 3, 1997, while he was still officially on leave and considered an employee by PRRM.
• Pulgar's admissions regarding financial irregularities (misappropriating funds, using fake receipts, opening a bank account for office savings under his name) provided a strong motive for him to sever his employment to evade investigation and potential criminal liability.
• The Court held that Pulgar himself terminated his employment by filing the illegal dismissal complaint while on leave, under circumstances indicating an attempt to pre-empt the investigation.
• Regarding PRRM's monetary claim for the P207,693.10, the Court ruled that this issue was belatedly raised, as PRRM failed to pray for such an award before the Labor Arbiter or the NLRC, and issues not raised at the trial court level cannot be considered for the first time on appeal.

• Burden of Proof in Illegal Dismissal Cases — The rule is that the employee must first establish by substantial evidence the fact of his dismissal from service. Before the employer must bear the burden of proving that the dismissal was legal, the employee must first establish by substantial evidence the fact of his dismissal from service. Logically, if there is no dismissal, then there can be no question as to its legality or illegality. In this case, Pulgar failed to prove he was dismissed; thus, the burden did not shift to PRRM.
• Constructive Dismissal — An involuntary resignation resorted to when continued employment is rendered impossible, unreasonable or unlikely; when there is a demotion in rank or diminution in pay or when a clear discrimination, insensibility or disdain by an employer becomes unbearable to the employee. In this case, Pulgar's bare allegations of being barred from the premises and his belongings being removed were uncorroborated and insufficient to prove constructive dismissal.
• Exceptions to the Rule that Factual Findings of the CA are Final (Rule 45 Petition) — A petition for review on certiorari under Rule 45 is limited to questions of law, and factual findings of the CA are generally final. However, this rule admits exceptions, such as when the findings of fact are conflicting (as between the NLRC and CA) or when relevant facts, if considered, would justify a different conclusion. The Court found such exceptions applicable, allowing it to review the evidence.
• Filing of Illegal Dismissal Complaint vis-a-vis Abandonment/Severance of Employment — While filing an illegal dismissal complaint is generally inconsistent with abandonment, it should be taken into account with surrounding circumstances. Substantial evidence by the employer that it did not terminate the employee should not be ignored. In this case, Pulgar's act of filing the complaint while on leave, coupled with his admissions of financial misconduct, indicated his intent to sever employment to evade investigation, rather than a genuine belief of dismissal.
• Belated Raising of Issues on Appeal — Points of law, theories, issues, and arguments not adequately brought to the attention of the trial court (or quasi-judicial body) need not be, and ordinarily will not be, considered by a reviewing court as they cannot be raised for the first time on appeal. This was applied to PRRM's claim for the return of funds, which it failed to properly raise as a relief before the Labor Arbiter.
• Social Justice in Labor Disputes — While the Constitution is committed to social justice and protection of the working class, it does not mean every labor dispute will automatically be decided in favor of labor. Management also has rights entitled to respect and enforcement in the interest of fair play. Justice is for the deserving, based on established facts and applicable law.

• "Before the employer must bear the burden of proving that the dismissal was legal, the employee must first establish by substantial evidence the fact of his dismissal from service. Logically, if there is no dismissal, then there can be no question as to its legality or illegality."
• "Bare allegations of constructive dismissal, when uncorroborated by the evidence on record, cannot be given credence."
• "The rule is that one who alleges a fact has the burden of proving it; thus, petitioners were burdened to prove their allegation that respondents dismissed them from their employment. It must be stressed that the evidence to prove this fact must be clear, positive and convincing. The rule that the employer bears the burden of proof in illegal dismissal cases finds no application here because the respondents deny having dismissed the petitioners."
• "The filing of a complaint for illegal dismissal should be taken into account together with the surrounding circumstances of a certain case... the substantial evidence proffered by the employer that it had not, in the first place, terminated the employee, should not simply be ignored on the pretext that the employee would not have filed the complaint for illegal dismissal if he had not really been dismissed. 'This is clearly a non-sequitur reasoning that can never validly take the place of the evidence of both the employer and the employee.'"
• "While the Constitution is committed to the policy of social justice and the protection of the working class, it should not be supposed that every labor dispute will be automatically decided in favor of labor. Management also has its rights which are entitled to respect and enforcement in the interest of simple fair play."

• Machica v. Roosevelt Services Center, Inc. — Cited to support the principle that the employee alleging dismissal bears the burden of proving it with clear, positive, and convincing evidence, especially when the employer denies dismissal.
• Leopard Integrated Services, Inc. v. Macalinao — Referenced for the proposition that filing an illegal dismissal complaint is not, by itself, a sufficient indicator that the employee had no intention of deserting employment, especially when the totality of antecedent acts suggests otherwise.
• Arc-Men Food Industries Inc. v. NLRC — Cited within the Leopard discussion, emphasizing that substantial evidence by the employer showing no termination occurred should not be ignored merely because an illegal dismissal complaint was filed.
• Ledesma, Jr. v. NLRC — Cited for the principle that before the employer bears the burden of proving legal dismissal, the employee must first establish the fact of dismissal.
• Go v. Court of Appeals — Cited for the rule that bare allegations of constructive dismissal, uncorroborated by evidence, cannot be given credence.
• Abad v. Roselle Cinema — Cited within the Leopard discussion, regarding the assessment of an employee's intention based on the totality of antecedent acts.
• Amigo v. Teves — Cited as a general reference for the scope of review under Rule 45, limiting it to questions of law.
• Campos v. Pastrana — Cited for the list of exceptions to the general rule that factual findings of the CA are conclusive.
• Enriquez v. Bank of Philippine Islands — Cited for the principle that while the Court often inclines towards the worker, justice is for the deserving based on facts and law, and management also has rights.
• Bañez v. Valdevilla — Referenced in relation to the Labor Arbiter's jurisdiction over all money claims arising from employer-employee relationships, including those of the employer.
• Tay Chun Suy v. Court of Appeals; Santos v. Intermediate Appellate Court; Berin v. Court of Appeals; Cruz v. Court of Appeals; National Power Corporation v. Gutierrez — Cited collectively to support the rule that issues not raised in the lower court cannot be raised for the first time on appeal as it offends fair play, justice, and due process.

• Rules of Court, Rule 45 — This rule governs petitions for review on certiorari filed with the Supreme Court. The Court reiterated that such petitions are limited to questions of law, but acknowledged exceptions allowing review of factual findings, which were applied in this case due to conflicting findings between the NLRC and CA and the presence of overlooked relevant facts.
• Rules of Court, Rule 65 — Mentioned as the mode by which Pulgar brought the NLRC decision to the CA (petition for certiorari). The decision notes this should have been a petition for certiorari, implying it was correctly identified.