Title
Baguio Country Club Corp. vs. National Labor Relations Commission
Case
G.R. No. 102397
Decision Date
Sep 4, 1992
Employee dismissed for failing to account for cash advances, unauthorized expenses, and document tampering; Supreme Court upheld dismissal, citing loss of trust and denied separation pay.
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Case Digest (G.R. No. 102397)

Facts:

Employment and Promotion:

  • Respondent Lolita Genove was employed by petitioner Baguio Country Club Corporation on September 1, 1973, as an Office Clerk. She was later promoted to higher positions, eventually becoming Personnel Manager and Chief Security Officer in February 1981.

Cash Advances and Failure to Account:

  • In October, December 1987, and April 1988, Genove received P6,000.00 as cash advances for expenses related to her role as a witness in a civil case involving the petitioner. However, she failed to account for these cash advances upon her return.

Preventive Suspension and Explanation:

  • On July 12, 1988, Genove was placed on preventive suspension due to various offenses, including unliquidated cash advances, unauthorized expenses, and tampering with documents. She was asked to explain her actions.
  • Genove submitted an explanation, justifying her expenses as necessary for her official duties, including items like lipstick, powder, and slippers, which she claimed were for grooming and security purposes during her trip.

Termination of Employment:

  • On September 2, 1988, petitioner’s general manager informed Genove that her expenses could not be charged against the club and that her actions constituted a breach of trust. Consequently, her employment was terminated.

Labor Arbiter’s Decision:

  • Genove filed a complaint for illegal dismissal on September 6, 1988. On January 29, 1991, the Labor Arbiter dismissed the complaint for lack of merit but ordered the petitioner to provide financial assistance of P31,500.00.

NLRC’s Reversal:

  • Genove appealed to the National Labor Relations Commission (NLRC), which reversed the Labor Arbiter’s decision on August 30, 1991. The NLRC ordered the petitioner to grant Genove separation pay of P63,000.00 in lieu of reinstatement.

Issue:

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Ruling:

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Ratio:

  1. Loss of Trust and Confidence:

    • The Court emphasized that loss of trust and confidence is a valid ground for dismissal, especially for employees in managerial positions. Genove’s actions, including the failure to liquidate cash advances, unauthorized personal expenses, and falsification of a receipt, constituted a breach of trust.
    • The Court found that Genove’s explanations for her expenses were unreasonable and that her actions demonstrated dishonesty, which justified the petitioner’s loss of confidence in her.
  2. Separation Pay:

    • The Court ruled that separation pay is not justified in cases where the dismissal is based on serious misconduct or dishonesty. Since Genove’s actions involved moral turpitude, the grant of separation pay was inappropriate.
    • The Court cited previous jurisprudence, including the PLDT v. NLRC case, which held that granting separation pay to employees dismissed for dishonesty would encourage similar misconduct in the future.

Conclusion: The Supreme Court granted the petition, reversed the NLRC’s resolution, and dismissed Genove’s complaint for illegal dismissal. The Court upheld the petitioner’s right to terminate Genove’s employment based on loss of trust and confidence and denied her claim for separation pay.


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