PLDT vs. Domingo

An employee's dismissal for serious misconduct is valid where the employer presents substantial evidence that the employee used forged requisition forms to fraudulently withdraw company materials, and procedural due process is satisfied through the twin-notice requirement without the necessity of a formal hearing or cross-examination of witnesses.

Cecilio Z. Domingo had been employed by PLDT as an Installer/Repairman since October 14, 1980. In May 2001, he was assigned as temporary Storekeeper of PLDT's Data Services Installation Maintenance Division (DSIM) warehouse in Tambo, Pasay City, and was appointed permanent Storekeeper in June 2001. As Storekeeper, Domingo was responsible for maintaining adequate inventory and accomplishing requisition forms — PLD 140 for base stock modems and PLD 158 for materials such as parallel wires, connectors, clamps, and electrical tapes — to withdraw supplies from PLDT's regular warehouses. The Collective Bargaining Agreement between PLDT and its employees contained a condonation provision stating that offenses punishable by termination are deemed condoned if no show-cause memorandum is issued within two years from discovery of the offense.

Cecilio Z. Domingo had been employed by PLDT as an Installer/Repairman since October 14, 1980. In May 2001, he was assigned as temporary Storekeeper of PLDT's Data Services Installation Maintenance Division (DSIM) warehouse in Tambo, Pasay City, and was appointed permanent Storekeeper in June 2001. As Storekeeper, Domingo's responsibilities included ensuring adequate inventory of supplies and accomplishing requisition forms to withdraw materials from PLDT's regular warehouses. Specifically, Storekeepers accomplished PLD 140 forms when base stock modems fell below a certain limit, while Combination Men accomplished PLD 158 forms to order materials such as parallel wires, connectors, clamps, and electrical tapes, which were then submitted to the Storekeeper for processing.

In 2001, the DSIM Tambo Warehouse transacted only three PLD 140 forms and 277 PLD 158 forms, with materials requisitioned under PLD 158 forms amounting to P1,069,285.36. In 2002, however, transactions drastically increased to 102 PLD 140 forms and 1,336 PLD 158 forms, with materials requisitioned under PLD 158 forms amounting to P17,081,843.31. Because of this drastic increase, PLDT conducted a materials inventory in December 2002 and discovered a huge discrepancy between the total volume of materials requisitioned and those actually used in projects or remaining in inventory. PLDT retrieved 88 out of 102 original warehouse copies of the 2002 PLD 140 forms and 1,121 out of 1,336 original warehouse copies of the 2002 PLD 158 forms. Examination revealed that the signatures of the supposed "authorized by" and "received by" personnel were forged. The DSIM Team Leaders — Vicente Ramos, Ernesto Alejandro, Ramir Espeno, and Alfred May — submitted sworn affidavits denying they authorized or signed the PLD forms, noting that the quantities were abnormally large and that it was impractical for provincial employees to requisition materials from Metro Manila warehouses. Eight other employees whose signatures appeared in the "received by" portion likewise stated the signatures were not theirs. Nimrod Paradero, Storekeeper of the DSIM Reposo Satellite Warehouse, positively identified Domingo as the person who presented the forged PLD forms and received the materials. Vehicle Security Registry reports for both the DSIM Sucat and Reposo Satellite Warehouses confirmed that Domingo personally went to these locations on the dates when materials under the forged PLD forms were requisitioned, including at least 65 separate occasions at the DSIM Sucat Satellite Warehouse. Clerks Maritess Mendoza and Sheryl Marie Magahis submitted sworn statements that Domingo instructed them to type and prepare the forged PLD forms.

PLDT issued three successive memoranda inviting Domingo to appear at formal inquiries — on May 14, 2004 (First Invitation), May 25, 2004 (Second Invitation), and June 7, 2004 (Third Invitation). Domingo refused to acknowledge receipt of all three invitations and failed to attend any of the scheduled inquiries. PLDT proceeded with the investigation and, after concluding its Investigation Report dated January 19, 2005, recommended that an administrative action for serious misconduct be instituted against Domingo. PLDT issued a Request for Explanation dated February 21, 2005, requiring Domingo to explain in writing within 72 hours why he should not be dismissed, informing him that the unaccounted materials cost the company P17,115,796.34 in losses, and that a hearing could be had if he so desired. On February 24, 2005, Domingo submitted a three-page letter with the assistance of counsel, denying the allegations, questioning why he was being made to explain wrongdoings committed three years earlier, and stating he was never informed of the investigation or furnished copies of the evidence against him. After review, PLDT found Domingo guilty of serious misconduct and issued a Notice of Termination dated May 18, 2005, dismissing him from service effective the close of business hours of that date.

Domingo filed a complaint for illegal dismissal before the Labor Arbiter, praying for reinstatement and full backwages. The Labor Arbiter dismissed the complaint on July 25, 2006, finding that PLDT established by substantial evidence Domingo's involvement in the anomalous transactions. The NLRC denied Domingo's appeal on June 27, 2007. The Court of Appeals, however, granted Domingo's petition for certiorari on January 31, 2011, finding that PLDT failed to overcome the quantum of substantial evidence, that there was no malicious intent on Domingo's part, that no proof of service of the three invitations was submitted, and that Domingo was not furnished a copy of the Investigation Report. The CA declared Domingo illegally dismissed and ordered reinstatement with full backwages and 10% attorney's fees. PLDT's motion for reconsideration was denied on June 22, 2011.

• Grave Abuse of Discretion: PLDT argued that the CA committed grave error in annulling the NLRC resolution because Domingo failed to demonstrate that the NLRC committed grave abuse of discretion amounting to lack or excess of jurisdiction.
• Sufficiency of Evidence: PLDT maintained that the NLRC's findings were supported by testimonial and documentary evidence sufficient to overcome the quantum of substantial evidence required in illegal dismissal cases.
• Due Process: PLDT contended that the NLRC correctly found that Domingo was not denied due process because he was given ample opportunity to be heard.
• Improper Relief: PLDT argued that since Domingo was validly dismissed, the CA erred in ordering reinstatement, backwages, and attorney's fees.

• Condonation: Domingo argued that the charges against him had been condoned under the CBA provision stating that offenses punishable by termination are deemed condoned if no show-cause memorandum is issued within two years from discovery, considering that the Request for Explanation was issued in 2005, three years after the supposed discovery.
• Invalidity of Invitations as Show-Cause Notices: Domingo contended that the First, Second, and Third Invitations could not be considered the "show cause" notices contemplated in the CBA because the Labor Code requires such notices to contain the statement of causes for termination.
• Lack of Proof of Receipt: Domingo argued that even assuming the invitations could be considered show-cause notices, PLDT presented no proof that he was properly furnished copies of the same.
• Insufficiency of Evidence: Domingo maintained that PLDT failed to demonstrate by substantial evidence his participation in the falsification, since the sworn statements relied upon by PLDT failed to attach original copies of the forged PLD forms, and the mere testimonies of PLDT's personnel should not be readily believed.
• Denial of Due Process: Domingo argued that procedural due process was not observed because no hearing or conference was conducted, he was not furnished copies of the investigative findings, and he was not confronted with all the evidence against him.
• Right to Cross-Examine: Domingo contended that he was denied due process because he was unable to cross-examine PLDT's witnesses, citing Caltex (Phils.), Inc. vs. Agad.

• Grave Abuse of Discretion: Whether the Court of Appeals committed serious error in giving due course to Domingo's petition for certiorari, notwithstanding his failure to establish grave abuse of discretion amounting to lack or excess of jurisdiction that would justify nullification of the NLRC decision.
• Validity of Dismissal: Whether PLDT presented substantial evidence to establish that Domingo was guilty of serious misconduct justifying his dismissal.
• Procedural Due Process: Whether Domingo was denied due process of law in the termination proceedings.
• Condonation: Whether Domingo's offense had been condoned under the CBA's two-year condonation provision.
• Necessity of Formal Hearing: Whether a formal hearing is required to satisfy procedural due process in illegal dismissal cases.
• Right to Cross-Examination: Whether the right to cross-examine witnesses is indispensable in labor proceedings.

• Grave Abuse of Discretion: No. The CA erred in disturbing the NLRC's factual findings, as the NLRC judiciously reviewed the records and based its ruling on substantial evidence presented by both parties, without any capricious or whimsical exercise of judgment.
• Validity of Dismissal: Yes. PLDT presented substantial evidence — including witness affidavits, vehicle registry records, audit findings, and Domingo's undisputed possession and use of forged PLD forms — establishing that Domingo committed serious misconduct warranting dismissal.
• Procedural Due Process: No, Domingo was not denied due process. The twin-notice requirement was satisfied through the Request for Explanation (first notice) and the Notice of Termination (second notice), and Domingo was given ample opportunity to be heard through his written response.
• Condonation: No. The three invitations served as the equivalent of show-cause memoranda under the CBA, and Domingo's own refusal to cooperate caused the delay in the investigation, so the offense cannot be deemed condoned.
• Necessity of Formal Hearing: No. A formal hearing is not a condition sine qua non for compliance with due process in termination cases; the "ample opportunity to be heard" standard is neither synonymous nor similar to a formal hearing.
• Right to Cross-Examination: No. The right to cross-examine witnesses is not indispensable in labor cases, as technical rules of evidence need not be strictly applied in proceedings before administrative bodies like the NLRC.

• Grave Abuse of Discretion: Findings of fact of quasi-judicial agencies such as the NLRC must be accorded great respect and even finality when supported by substantial evidence. The CA's limited jurisdiction under Rule 65 permits reversal only upon a clear showing of grave abuse of discretion — a capricious and whimsical exercise of judgment equivalent to lack of jurisdiction, or an arbitrary or despotic exercise of power so patent and gross as to amount to an evasion of positive duty. Applying this standard, the Court found no grave abuse of discretion on the part of the NLRC, which judiciously reviewed the records and based its ruling on substantial evidence. The CA therefore erred in modifying and reversing the NLRC's factual findings.

• Validity of Dismissal: The quantum of proof in illegal dismissal cases is substantial evidence — "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion" — the least demanding in the hierarchy of evidentiary values. Serious misconduct, as defined in Maula vs. Ximex Delivery Express, Inc., requires that the misconduct be (a) serious, (b) related to the performance of the employee's duties, and (c) such as to render the employee unfit to continue working for the employer. PLDT presented numerous witnesses, documentary evidence, and a complete Investigation Report establishing Domingo's involvement in a fraudulent scheme using forged PLD forms. Domingo's undisputed possession and use of the forged PLD forms gave rise to a presumption that he was involved in the fraudulent scheme, pursuant to the rule that a person found in possession of a forged document and who used the same, without satisfactory explanation, is the forger thereof or the one who caused the forgery. Domingo's bare denials — that he was merely following instructions and never received formal training — were unconvincing, as he had been Storekeeper since May 2001 and the anomalies only commenced in 2002, giving him at least six months to learn and follow PLDT's procurement procedure. The drastic increase from three PLD 140 and 277 PLD 158 transactions in 2001 to 102 and 1,336 respectively in 2002 made it incredulous for him to claim ignorance. All three elements of serious misconduct were satisfied: the act cost PLDT P17,115,796.34 in material losses; the offense related to his functions as Storekeeper, which required full trust and confidence; and his acts rendered him unfit to continue employment given PLDT's loss of trust and confidence.

• Procedural Due Process: Procedural due process in termination cases requires two written notices: (1) the first apprises the employee of the particular acts or omissions for which dismissal is sought, and (2) the second informs the employee of the employer's decision to dismiss. The hearing requirement is complied with as long as there was an opportunity to be heard, not necessarily that an actual hearing was conducted. Here, Domingo was furnished the Request for Explanation, which outlined the particular acts constituting serious misconduct, asked him to respond within 72 hours, and informed him that a hearing could be had if he desired. Domingo responded with a three-page letter but nowhere requested a formal hearing. PLDT then issued the Notice of Termination after reviewing all evidence and Domingo's response. All requisites of procedural due process were thus satisfied.

• Condonation: The CBA provides that offenses punishable by termination are deemed condoned if no show-cause memorandum is issued within two years from discovery. The Court found that PLDT could not be faulted for the delay in issuing the Request for Explanation because Domingo himself intentionally failed to cooperate in the investigation by refusing to acknowledge receipt of the three invitations. The three invitations were akin to the show-cause memoranda required under the CBA, as they already informed Domingo that a formal inquiry would be conducted regarding his involvement in the fraudulent use of forged PLD forms. Domingo's claim that no proof of receipt was presented was self-serving and unpersuasive given PLDT's three attempts at service on three separate occasions. The offense therefore could not be deemed condoned.

• Necessity of Formal Hearing: Jurisprudence is clear that a formal hearing is not necessary as long as the employee is given ample opportunity to be heard. The "ample opportunity to be heard" standard under Article 277(b) of the Labor Code is neither synonymous nor similar to a formal hearing. Section 2(d), Rule I of the Implementing Rules of Book VI of the Labor Code provides that the standards of due process shall be observed "substantially," not strictly — recognizing that while a formal hearing is ideal, it is not an absolute, mandatory, or exclusive avenue of due process. In this case, PLDT expressly gave Domingo the opportunity to request a formal hearing in the Request for Explanation, which he failed to do.

• Right to Cross-Examination: The right to cross-examine witnesses is not indispensable in labor cases. In Caltex (Phils.), Inc. vs. Agad, the statement that cross-examination was necessary was mere obiter dictum and did not pertain to the key issue. The settled doctrine that technical rules of evidence are not strictly applied in labor cases still stands. In Smart Communications, Inc. vs. Solidum, the Court explicitly stated that it is not necessary that witnesses be cross-examined by counsel of the adverse party in proceedings before the labor arbiter, as the rules of evidence are not strictly observed in proceedings before administrative bodies like the NLRC where decisions may be reached on the basis of position papers only. The essence of due process lies in the reasonable opportunity to be heard and submit evidence, not in the opportunity to cross-examine an adverse witness. The same relaxation of technical rules applied to Domingo's claim that the evidence attached to PLDT's affidavits were mere photocopies — the NLRC did not err in giving them evidentiary weight.

• Substantial Evidence in Labor Cases — Substantial evidence is "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." In the hierarchy of evidentiary values, it is the least demanding, below proof beyond reasonable doubt, clear and convincing evidence, and preponderance of evidence. In illegal dismissal cases, the employer need only present evidence adequate to support a conclusion, not evidence establishing moral certainty of guilt. The Court applied this standard to find that PLDT's evidence — witness affidavits, vehicle registry records, audit findings, and Domingo's possession and use of forged forms — sufficiently established serious misconduct.

• Serious Misconduct as Just Cause for Dismissal — Misconduct is improper or wrong conduct; the transgression of some established and definite rule of action, a forbidden act, a dereliction of duty, willful in character, implying wrongful intent and not mere error in judgment. For misconduct to be a just cause for dismissal, it must be (a) serious, (b) relate to the performance of the employee's duties, and (c) show that the employee has become unfit to continue working for the employer. The Court found all three elements present: the fraudulent requisitions cost PLDT over P17 million; the offense related to Domingo's functions as Storekeeper requiring full trust and confidence; and his acts rendered him unfit for continued employment.

• Twin-Notice Requirement in Termination Cases — Procedural due process in termination cases requires two written notices: (1) the first apprises the employee of the particular acts or omissions for which dismissal is sought, and (2) the second informs the employee of the employer's decision to dismiss. A formal hearing is not necessary so long as the employee was granted an opportunity to be heard. The Court found both notices satisfied through the Request for Explanation and the Notice of Termination.

• Opportunity to Be Heard vs. Formal Hearing — The "ample opportunity to be heard" standard under Article 277(b) of the Labor Code is neither synonymous nor similar to a formal hearing. The very nature of due process negates any concept of inflexible procedures universally applicable to every imaginable situation. While a formal hearing or conference is ideal, it is not an absolute, mandatory, or exclusive avenue of due process. The Court applied this doctrine to reject Domingo's claim that the absence of a formal hearing violated his right to due process.

• Relaxation of Technical Rules of Evidence in Labor Cases — Administrative bodies such as the NLRC are not bound by the technical niceties of law and procedure and the rules obtaining in courts of law. Decisions may be reached on the basis of position papers only. The right to cross-examine witnesses is not indispensable; what is vital is the opportunity to be heard. The Court applied this doctrine to uphold the NLRC's consideration of PLDT's affidavits and their photocopy attachments, and to reject Domingo's claim that the inability to cross-examine witnesses rendered the evidence hearsay.

• Presumption from Possession of Forged Documents — In the absence of a satisfactory explanation, a person found in possession of a forged document and who used the same is presumed to be the forger thereof or the one who caused the forgery, and therefore guilty of falsification. The Court applied this presumption, citing Alarcon vs. Court of Appeals, to find that Domingo's undisputed possession and use of the forged PLD forms established his involvement in the fraudulent scheme.

• "The 'ample opportunity to be heard' standard is neither synonymous nor similar to a formal hearing. To confine the employee's right to be heard to a solitary form narrows down that right. It deprives him of other equally effective forms of adducing evidence in his defense." — This passage, quoting Perez vs. Philippine Telegraph and Telephone Company, articulates the controlling doctrine that due process in labor termination cases does not require a formal hearing, only a reasonable opportunity to explain one's side.

• "It is not necessary that witnesses be cross-examined by counsel of the adverse party in proceedings before the labor arbiter." — This passage, quoting Smart Communications, Inc. vs. Solidum, which in turn cited Philippine Long Distance Telephone Company vs. Honrado, establishes the rule that cross-examination is not indispensable in labor proceedings, as technical rules of evidence are not strictly applied before administrative bodies like the NLRC.

• "In the absence of satisfactory explanation, a person who is found in possession of a forged document and who used the same, is the forger thereof, or the one who caused the forgery, and therefore, he is guilty of falsification." — This passage, quoting Alarcon vs. Court of Appeals as adopted by the NLRC, articulates the presumption applied to find Domingo liable for the fraudulent use of forged PLD forms.

• "The essence of due process lies in the reasonable opportunity afforded a party to be heard and to submit any evidence in support of its defense. What is vital is not the opportunity to cross-examine an adverse witness, but an opportunity to be heard." — This passage, quoting C.F. Sharp Crew Management, Inc. vs. Espanol, Jr., defines the essential content of due process in labor cases and distinguishes it from the formal trial-type proceedings of civil litigation.

• Maula vs. Ximex Delivery Express, Inc., 804 Phil. 365 (2017) — Cited as controlling authority defining the elements of serious misconduct as a just cause for dismissal: (a) the misconduct must be serious, (b) it must relate to the performance of the employee's duties, and (c) it must show that the employee has become unfit to continue working for the employer.
• Distribution & Control Products, Inc./Tiamsic vs. Santos, 813 Phil. 423 (2017) — Cited for the twin-notice requirement in termination proceedings and the rule that a formal hearing is not necessary so long as the employee was granted an opportunity to be heard.
• Perez vs. Philippine Telegraph and Telephone Company, 602 Phil. 522 (2009) — Cited for the doctrine that the "ample opportunity to be heard" standard under Article 277(b) of the Labor Code is neither synonymous nor similar to a formal hearing, and that a formal hearing is not a condition sine qua non for due process compliance.
• Smart Communications, Inc. vs. Solidum, 774 Phil. 289 (2015) — Cited for the explicit ruling that cross-examination of witnesses is not necessary in proceedings before the labor arbiter, as technical rules of evidence are not strictly applied before the NLRC.
• C.F. Sharp Crew Management, Inc. vs. Espanol, Jr., 559 Phil. 826 (2007) — Cited for the principle that the essence of due process in labor cases is the reasonable opportunity to be heard and submit evidence, not the opportunity to cross-examine an adverse witness.
• Caltex (Phils.), Inc. vs. Agad, 633 Phil. 216 (2010) — Distinguished; the statement therein regarding the necessity of cross-examination was characterized as obiter dictum that did not pertain to the key issue, and thus did not overturn the settled doctrine relaxing technical rules of evidence in labor cases.
• Alarcon vs. Court of Appeals, G.R. No. L-21846, March 31, 1967 — Cited via the NLRC's resolution for the presumption that a person found in possession of a forged document and who used the same, without satisfactory explanation, is the forger or the one who caused the forgery.
• JR Hauling Services vs. Solamo, G.R. No. 214294, September 30, 2020 — Cited for the definition of substantial evidence as the quantum of proof required in labor proceedings, being the least demanding in the hierarchy of evidentiary values.

• Article 277(b), Labor Code — Requires that in cases of termination for a just cause, the employee must be given "ample opportunity to be heard and to defend himself." The Court applied this provision to find that Domingo's submission of a written response to the Request for Explanation satisfied the opportunity to be heard, even without a formal hearing or cross-examination.
• Section 2(d), Rule I, Implementing Rules of Book VI of the Labor Code — Provides standards of due process in termination cases, stating that such standards shall be observed "substantially," not strictly. The Court relied on this provision to support the ruling that a formal hearing, while ideal, is not an absolute, mandatory, or exclusive avenue of due process.
• Collective Bargaining Agreement (PLDT and Employees) — Contains a condonation provision stating that offenses punishable by termination are deemed condoned if no show-cause memorandum is issued within two years from discovery. The Court interpreted the three invitations to appear as the functional equivalent of show-cause memoranda under this provision, and held that Domingo's refusal to cooperate caused the delay, precluding condonation.

Gesmundo, C.J. (Chairperson), Caguioa, Carandang, and Zalameda, JJ., concurred.