University of Sto. Tomas vs. NLRC

A part-time faculty member cannot acquire permanent employment or security of tenure under the Manual of Regulations for Private Schools; only a full-time teacher who has rendered three consecutive years of satisfactory service may become permanent, and the non-renewal of a lapsed temporary appointment is not constructive dismissal.

The University of Sto. Tomas is a private educational institution; Dr. Basilio E. Borja was a physician who practiced psychiatry and was appointed to its Faculty of Medicine and Surgery, Department of Neurology and Psychiatry. His appointments were temporary and part-time. Policy Instructions No. 11 issued by the Department of Labor and Employment subjects the probationary employment of professors, instructors and teachers to standards established by the Department of Education and Culture, embodied in the Manual of Regulations for Private Schools. Those standards govern the acquisition of permanent status and security of tenure by faculty members.

Dr. Basilio E. Borja was first appointed as “affiliate faculty” in the Faculty of Medicine and Surgery of the University of Sto. Tomas on September 29, 1976. In the second semester of school year 1976-77 he was appointed instructor with a load of twelve hours a week. He was reappointed instructor for 1977-78 with nine hours a week in the first semester and two hours a week in the second. On June 10, 1978 he was appointed Instructor III for 1978-79, with eight hours a week in the first semester and seven hours a week in the second. All of these appointments were part-time.

On March 19, 1979 Dean Gilberto Gamez observed that Borja should not be reappointed based on an evaluation sheet showing sub-standard and inefficient performance. Because of the critical shortage of staff in the Department of Neurology and Psychiatry, however, Gamez recommended Borja’s reappointment after informing him of the negative feedback and after Borja promised to improve. On July 27, 1979 Borja was extended a reappointment as Instructor III for school year 1979-80 with a load of six hours a week. At the end of the academic year, it appearing that he had not improved his performance despite his assurances, his reappointment was not recommended.

In July 1982 Borja filed a complaint in the National Labor Relations Commission for illegal dismissal against UST. The Labor Arbiter and NLRC found that Borja had rendered eight semesters or four academic years of professional duties with UST and had met the three-year requirement under the Manual of Regulations for Private Schools; the NLRC also found that he had been constructively terminated.

The record showed that Borja was practising his profession as a doctor and maintaining a clinic in the hospital during the time he had a teaching load, so that he had another regular remunerative work aside from teaching. His salaries from teaching averaged P660.00 per month, and there was no evidence that he performed other functions for the school when not teaching. Dean Gamez’s affidavit stated that as affiliate faculty member Borja had no teaching functions; that in 1977-78 he had nine hours a week in the first semester and two in the second; that in 1978-79 he had eight hours a week in the first semester and seven in the second; and that in 1979-80 he had six hours a week in each semester. Borja did not refute this evidence, and his average teaching load was 6.33 hours a week.

• Tenure: Petitioners argued that the NLRC committed serious reversible errors in finding that Borja acquired tenure, contrary to the evidence and devoid of basis in law.
• Constructive Dismissal: Petitioners maintained that the NLRC gravely abused its discretion in holding that Borja’s services had been constructively terminated, because his appointment had merely lapsed in accordance with its terms as accepted by Borja.
• Damages: Petitioners contended that the NLRC committed grave error in affirming the labor arbiter’s award of excessive, unjust, unconscionable and shocking moral damages of P300,000.00 and in awarding motu proprio exemplary damages of P100,000.00, amounting to grave abuse of discretion and excess of jurisdiction.

• Governing Standard and Requisites for Tenure: Whether the acquisition of permanent employment or security of tenure by faculty members is governed by the Manual of Regulations for Private Schools and requires full-time status, three consecutive years of satisfactory service, and compliance with the Manual’s definition of a full-time teacher, rather than completion of three years alone.
• Tenure: Whether private respondent Basilio E. Borja acquired permanent employment or security of tenure under the Manual of Regulations for Private Schools despite being a part-time faculty member.
• Constructive Dismissal: Whether the non-renewal of Borja’s temporary appointment constituted constructive dismissal or was merely the lapse of his appointment in accordance with its terms.
• Damages: Whether the NLRC gravely abused its discretion in affirming the award of moral damages and in awarding exemplary damages and attorney’s fees.

• Governing Standard and Requisites for Tenure: No. The Manual of Regulations for Private Schools, not the Labor Code, determines regular status, but completion of three years alone does not suffice; the teacher must be full-time, have rendered three consecutive years of satisfactory service, and meet the Manual’s full-time definition.
• Tenure: No. Borja was not a full-time teacher: his total working day was not devoted to UST, he had other regular remunerative employment, he was not paid on a regular monthly basis, and his average load was 6.33 hours a week, below the 18-hour nominal load for college instructors.
• Constructive Dismissal: No. Because Borja did not become permanent, UST had no duty to reappoint him; his temporary appointment lapsed, and non-renewal was not constructive dismissal.
• Damages: No. The awards of actual or compensatory, moral, and exemplary damages and attorney’s fees must be struck down because they rested on the erroneous findings of tenure and constructive dismissal.

• Governing Standard and Requisites for Tenure: The NLRC correctly declared that the Manual of Regulations for Private Schools, not the Labor Code, determines acquisition of regular or permanent status of faculty members in an educational institution. The majority disagreed, however, that only completion of three years of service is required. Policy Instructions No. 11 issued by the Department of Labor and Employment provides that the probationary employment of professors, instructors and teachers shall be subject to standards established by the Department of Education and Culture. Paragraph 75 of the Manual states: “Full time teachers who have rendered three consecutive years of satisfactory service shall be considered permanent.” The legal requisites are: (1) the teacher is a full-time teacher; (2) the teacher must have rendered three consecutive years of service; and (3) such service must have been satisfactory. Paragraph 77 defines a full-time teacher as one whose total working day is devoted to the school, who has no other regular remunerative employment, and who is paid on a regular monthly basis regardless of the number of teaching hours. Paragraph 78 states that in college the nominal teaching load of a full-time instructor shall be eighteen hours a week. A part-time member of the faculty cannot acquire permanence under the Manual in relation to the Labor Code.

• Tenure: The crucial question was whether Borja was a full-time or part-time member of the faculty during the three years he served. The record showed that his total working day was not devoted to the school alone; he practised his profession as a doctor and maintained a clinic in the hospital during the time he had a teaching load, so he had another regular remunerative work aside from teaching. His salaries from teaching averaged only P660.00 per month, showing that he had other sources of income and that he was not paid on a regular monthly basis. There was no evidence that he performed other functions for the school when not teaching. Teaching was only a secondary occupation or sideline, his professional practice as a psychiatrist being his main vocation. He never had a normal teaching load of eighteen hours a week. Dean Gamez’s affidavit, unrefuted and ignored by the NLRC, showed loads of nine and two hours in 1977-78, eight and seven in 1978-79, and six in each semester of 1979-80. His average teaching load was only 6.33 hours a week. Thus he could not be regarded as a full-time teacher and did not become permanent even after three years. The NLRC’s finding that he had eight semesters or four academic years did not satisfy the full-time requirement.

• Constructive Dismissal: Having found that Borja did not become a permanent employee of UST, it correspondingly followed that there was no duty on the part of UST to reappoint him as Instructor; the temporary appointment had lapsed. Such appointment is a matter addressed to UST’s discretion. The NLRC’s finding that Borja was constructively terminated was without lawful basis.

• Damages: Because the findings of tenure and constructive termination were erroneous, the order for reinstatement with backwages and the awards of actual or compensatory, moral, and exemplary damages had to be struck down. The awards could not stand absent a valid finding of illegal or constructive dismissal.

• Full-time teacher requirement for permanence — Under paragraph 75 of the Manual of Regulations for Private Schools, only full-time teachers who have rendered three consecutive years of satisfactory service are considered permanent. The requisites are: (a) the teacher is full-time; (b) the teacher has rendered three consecutive years of service; and (c) the service is satisfactory. A part-time faculty member cannot acquire permanence. Applied: Borja was part-time, so his four academic years of service did not confer tenure.
• Definition of full-time teacher — Paragraph 77 defines a full-time teacher as one whose total working day is devoted to the school, who has no other regular remunerative employment, and who is paid on a regular monthly basis regardless of the number of teaching hours. Paragraph 78 sets the nominal teaching load of a full-time college instructor at eighteen hours a week. Applied: Borja had a separate psychiatric practice, was paid on an averaged basis, and taught only an average of 6.33 hours a week, so he was not full-time.
• Lapse of temporary appointment and no constructive dismissal — Where a faculty member has not acquired permanent status, the school has no duty to reappoint him; the temporary appointment lapses according to its terms, and non-renewal is not constructive dismissal. Applied: UST’s non-reappointment of Borja was an exercise of discretion over a lapsed temporary appointment, not an illegal dismissal.
• Damages require a valid finding of illegal dismissal — Awards of actual or compensatory, moral, and exemplary damages and attorney’s fees cannot stand where there is no illegal or constructive dismissal. Applied: the NLRC’s monetary awards were struck down after the tenure and constructive-dismissal findings were reversed.

• “The legal requisites, therefore, for acquisition by a teacher of permanent employment, or security of tenure, are as follows: 1) the teacher is a full time teacher; 2) the teacher must have rendered three (3) consecutive years of service; and 3) such service must have been satisfactory.” — This passage states the controlling requisites for faculty permanence under the Manual of Regulations for Private Schools and anchors the Court’s rejection of the NLRC’s three-year-only theory.
• “It follows that a part-time member of the faculty cannot acquire permanence in employment under the Manual of Regulations in relation to the Labor Code.” — This is the ratio decidendi on part-time faculty, directly disposing of Borja’s claim to security of tenure.
• “Having found that private respondent did not become a permanent employee of petitioner UST, it correspondingly follows that there was no duty on the part of petitioner UST to reappoint private respondent as Instructor, the temporary appointment having lapsed. Such appointment is a matter addressed to the discretion of said petitioner.” — This passage explains why the non-renewal of Borja’s appointment was not unlawful and negates constructive dismissal.
• “The findings, therefore, of the public respondent NLRC that private respondent was constructively terminated is without lawful basis. By the same token, the order for reinstatement of private respondent with backwages plus an award of actual or compensatory, moral and exemplary damages must be struck down.” — This passage links the erroneous constructive-dismissal finding to the elimination of all monetary awards.

• Policy Instructions No. 11, Department of Labor and Employment — Provides that the probationary employment of professors, instructors and teachers shall be subject to standards established by the Department of Education and Culture. Applied to require compliance with the Manual of Regulations for Private Schools.
• Paragraph 75, Manual of Regulations for Private Schools — “Full time teachers who have rendered three consecutive years of satisfactory service shall be considered permanent.” Applied to establish the requisites for permanence and to hold that Borja, a part-time teacher, did not acquire tenure.
• Paragraph 77, Manual of Regulations for Private Schools — Defines a full-time teacher as one whose total working day is devoted to the school, has no other regular remunerative employment, and is paid on a regular monthly basis regardless of the number of teaching hours. Applied to Borja, who had a separate psychiatric practice and was paid on an averaged basis.
• Paragraph 78, Manual of Regulations for Private Schools — States that in college the nominal teaching load of a full-time instructor shall be eighteen hours a week. Applied to show Borja’s average load of 6.33 hours a week fell short.
• Labor Code — Referred to in the NLRC decision and in the Court’s discussion; the Court held that it is the Manual, not the Labor Code, that determines acquisition of regular or permanent status of faculty members in an educational institution. No specific article was cited in the text.

• Fernan (C.J.)
• Melencio-Herrera
• Gutierrez, Jr.
• Cruz
• Paras
• Feliciano
• Bidin
• Cortes
• Griño-Aquino
• Medialdea
• Regalado

Narvasa and Padilla, JJ., took no part.

• Justice Sarmiento — He voted to deny the petition for lack of merit, finding no grave abuse of discretion in the NLRC. He sustained the NLRC’s conclusion that Borja’s services were terminated without just cause. In his view, Borja acquired security of tenure after his three-year probation; the extension of another year meant the school had been satisfied with his performance, and UST could not later say otherwise. The UST Faculty Code’s four-year rule could not prevail over the Manual of Regulations for Private Schools, which has the character and force of law. Under paragraph 75, full-time teachers with three consecutive years of satisfactory service are permanent; paragraph 76 defines full-time; and paragraph 78’s eighteen-hour load operates as a restraint on excessive manhours, not as a rule making an instructor part-time if he otherwise meets paragraph 76. The NLRC found Borja worked on a full-time basis regardless of teaching hours, and that finding could not be disturbed. Even assuming the four-year rule, Borja’s tenure was secure and could be perished only by valid cause; “negative feedbacks” were no excuse for termination. The closure of his clinic was a valid basis for moral and exemplary damages and attorney’s fees.