Title
Bago vs. National Labor Relations Commission
Case
G.R. No. 170001
Decision Date
Apr 4, 2007
Employee dismissed for dishonesty after admitting involvement in misappropriation scheme; court upheld termination, citing loss of trust despite rank-and-file status.
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Case Digest (G.R. No. 170001)

Facts:

1. Initial Complaint and Charges:

  • On November 20, 2002, Celia P. Abordo, the Head of the Tuguegarao Branch of Standard Insurance Company Incorporated (SICI), filed a complaint with the Human Resource Development Department (HRDD) against five employees, including petitioner Arlyn Bago (an encoder) and Elsie Pagarigan (an assistant underwriter). The charges included manipulating money from agents/zone managers and Celia’s commissions, as well as spreading rumors about Celia having an affair with the claims assistant.

2. Internal Audit Findings:

  • A special audit conducted from November 25-29, 2002, revealed that commissions due to agents and the Branch Head were not given. The audit found that commission slips were not signed, and funds were misappropriated through various schemes, including drawing from the G&A Fund and cash collections. The Branch Cashier and Branch Accountant admitted to the dishonesty, and it was revealed that the funds were divided equally among the involved employees, including Arlyn.

3. Admission of Involvement:

  • Arlyn and other employees admitted their involvement in the dishonest scheme during the audit. Arlyn submitted a written statement acknowledging her participation and apologizing for her actions, stating that she was willing to return the amount she benefited from.

4. Rumor-Mongering Allegations:

  • Arlyn and two other employees were also charged with spreading malicious rumors about Celia. They initially failed to respond to the charge but later submitted a joint statement apologizing for their actions and claiming that Celia had forgiven them.

5. Termination:

  • After a formal hearing, Arlyn and the other involved employees were terminated effective March 31, 2003, on the grounds of dishonesty and loss of trust and confidence.

6. Legal Proceedings:

  • Arlyn and Elsie filed complaints for illegal dismissal. The Labor Arbiter ruled in their favor, ordering reinstatement and awarding backwages, moral damages, exemplary damages, and attorney’s fees. However, the National Labor Relations Commission (NLRC) reversed this decision, upholding the termination. The Court of Appeals affirmed the NLRC’s decision.

Issue:

  1. Whether Arlyn Bago, as an ordinary rank-and-file employee, could be dismissed for loss of trust and confidence.
  2. Whether the penalty of dismissal was appropriate given that the actual amount of money misappropriated was never established.
  3. Whether Arlyn was denied due process, including the opportunity to cross-examine witnesses and a proper investigation.
  4. Whether the discontinuation of Arlyn’s payroll reinstatement after the NLRC’s decision was valid.

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)


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