Facts:

The case involves Viola Cruz as the petitioner against the National Labor Relations Commission (NLRC), Norkis Distributors, Inc., Jose Ramiro A. Carpio, Jr., Wessie Quisumbing, and Elizalde Ampalayo as respondents. The events leading to the case began in March 1990 when Cruz was employed by Norkis Distributors, Inc. as a cashier/bookkeeper at its Cagayan de Oro City branch, later transferring to its Valencia, Bukidnon branch. On October 14, 1990, while preparing for an office transfer, Cruz collapsed and was subsequently hospitalized for serious health issues, including Cryptococcal Meningitis. She was unable to report for work from October 15, 1990, and on November 2, 1990, she received a termination letter citing health reasons for her dismissal. Cruz filed a complaint for illegal dismissal on March 18, 1991, seeking various monetary claims. The Labor Arbiter ruled in her favor on May 28, 1993, awarding her separation pay, service incentive leave pay, and damages. However, ...

Facts:

Employment and Transfer:

• Petitioner Viola Cruz was hired by respondent Norkis Distributors, Inc. in March 1997 as a cashier/bookkeeper at its Cagayan de Oro City branch. She was later transferred to the Valencia, Bukidnon branch.
• In July 1990, she received a salary adjustment of P100.00 for her loyalty and dedication.

Health Issues and Hospitalization:

• On October 14, 1990, while preparing for the branch's relocation, Cruz collapsed and was rushed to Monsanto General Hospital. She returned to work the next day but was later transferred to Capitol College General Hospital on October 17, 1990, where she was diagnosed with "CNS Infection: TB Meningitis vs. Cryptococcal Meningitis."
• She was subsequently confined at Maria Reyna Hospital from October 25 to December 5, 1990, for treatment of "Cryptococcal Meningitis, Pottas Disease, and Diabetes Mellitus Type II."
• Cruz stopped reporting for work starting October 15, 1990. On October 19, 1990, Norkis was informed of her condition and hired Hernando Juaman as her replacement.

Termination and Complaint:

• On December 28, 1990, Cruz inquired about her employment status and received a termination letter dated November 2, 1990, citing health reasons as the cause for her dismissal.
• On March 18, 1991, Cruz filed a complaint for illegal dismissal, seeking separation pay, service incentive leave pay, 13th month pay, and damages.

Labor Arbiter’s Decision:

• On May 28, 1993, Labor Arbiter Leon P. Murillo ruled in favor of Cruz, awarding her separation pay, service incentive leave pay, proportionate 13th month pay, and damages.

NLRC’s Reversal:

• Both parties appealed to the NLRC, which reversed the Labor Arbiter’s decision on November 19, 1993, dismissing Cruz’s complaint but ordering Norkis to pay her unpaid service incentive leave pay and proportionate 13th month pay.

Issue:

• (Unlock)

Ruling:

• (Unlock)

Ratio:

1. Illegal Dismissal:

   • The Court found that Norkis failed to comply with the legal requirements for dismissing an employee due to illness. Under Section 8, Rule I, Book VI of the Rules and Regulations Implementing the Labor Code, a valid dismissal for health reasons requires a certification from a competent public health authority that the disease is incurable within six months. Norkis failed to provide such certification.
   • The Court also rejected Norkis’ claim that Cruz abandoned her job, noting that her absence was due to her hospitalization and serious illness. Abandonment requires a clear intention to sever the employment relationship, which was not present in this case.
   • The Court further dismissed Norkis’ claim of loss of trust and confidence due to alleged defalcation of funds, as there was no substantial evidence to support this claim.

2. Moral and Exemplary Damages:

   • The Court held that Cruz’s unjustified dismissal warranted the award of moral and exemplary damages. However, the amount awarded by the Labor Arbiter was excessive. The Court reduced the damages to P50,000.00 for moral damages and P10,000.00 for exemplary damages.

3. Due Process Violation:

   • The Court emphasized that Norkis failed to comply with the mandatory two-notice rule for termination. Cruz was not given proper notice of the charges against her or an opportunity to defend herself, rendering her dismissal illegal.

Conclusion:

The Supreme Court ruled in favor of Viola Cruz, finding her dismissal illegal due to Norkis’ failure to comply with legal requirements and due process. The Court reinstated the Labor Arbiter’s decision but reduced the damages awarded.