Title
Aguanza vs. Asian Terminal, Inc.
Case
G.R. No. 163505
Decision Date
Aug 14, 2009
A crane operator objected to reduced benefits after his vessel’s transfer to Bataan; the court ruled no constructive dismissal, upholding management prerogative.
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Case Digest (G.R. No. 163505)

Facts:

Employment and Initial Assignment

  • Petitioner Gualberto Aguanza was employed by respondent Asian Terminal, Inc. (ATI) on April 15, 1989, as a Derickman or Crane Operator assigned to Bismark IV, a floating crane barge based in Manila.
  • As of October 1997, Aguanza received the following benefits:
    • Basic salary: P8,303.30
    • Meal allowance: P1,800/month
    • Fixed overtime pay of 16 hours when assigned outside Metro Manila
    • Out-of-port allowance: P260/day when assigned outside Manila.

Transfer of Bismark IV to Bataan

  • In September 1997, Bismark IV and its crew were temporarily assigned to the Mariveles Grains Terminal in Bataan.
  • On October 20, 1997, ATI issued a memo stating that Bismark IV would be permanently based in Bataan starting October 1, 1997, and its crew would no longer receive out-of-port benefits, including 16 hours overtime and P200/day allowance.

Aguanza's Objection

  • Aguanza and four other crew members objected to the reduction of benefits but not to the transfer itself.
  • Aguanza was shuttled between Manila and Bataan without work assignments and eventually wrote to ATI, expressing his willingness to work in either location but under the previous terms.
  • ATI refused to reinstate his previous benefits, leading Aguanza to file a complaint for illegal dismissal.

ATI's Position

  • ATI claimed that Aguanza was employed in 1996 and that the transfer to Bataan was part of its operations.
  • ATI offered new terms for the transfer, including:
    • Regular 40-hour duty Monday to Friday
    • Overtime pay for work exceeding 8 hours/day
    • Overtime pay on Saturdays and Sundays
    • No additional allowance or transportation.
  • All crew members except Aguanza accepted the transfer.

Issue:

  • (Unlock)

Ruling:

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Ratio:

  1. Management Prerogative: The transfer of employees is a management prerogative, subject to limitations under the law, collective bargaining agreements, and principles of fairness. ATI's transfer of Bismark IV to Bataan was a legitimate business decision.
  2. No Constructive Dismissal: Constructive dismissal occurs when continued employment becomes impossible, unreasonable, or involves a demotion or diminution of pay. Aguanza's transfer did not meet these criteria. His basic salary remained unchanged, and the removed benefits were conditional on out-of-port assignments.
  3. Conditional Benefits: The fixed overtime and out-of-port allowances were not part of Aguanza's basic salary but were contingent on specific conditions (i.e., out-of-port assignments). Their removal did not violate the rule against diminution of benefits.
  4. Aguanza's Refusal to Report: Aguanza's insistence on reporting to Manila instead of Bataan, where his work was assigned, demonstrated his refusal to comply with the terms of his employment. This refusal, not ATI's actions, led to his inability to work.


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