G.R. No. 182114 - Genesis Transport Service, Inc. vs. Unyon ng Malayang Manggagawa ng Genesis Transport

Respondent Juan Taroy was hired on February 2, 1992 by petitioner Genesis Transport Service, Inc. as a driver on a commission basis, earning 9% of the gross revenue per trip.
His employment terms involved company practices which later became contentious, notably concerning deductions from gross receipts for tollgate fees.

On April 20, 2002, an accident occurred involving Taroy; investigations attributed the incident to his alleged reckless driving.
Following the accident, Taroy was placed under preventive suspension and, after due notice and a hearing, was terminated on May 10, 2002. His termination became a focal point of dispute regarding the validity of the disciplinary process.

Taroy filed a complaint on June 7, 2002 alleging illegal dismissal, contending he was singled out for termination due to his union activities.
He later amended his complaint to add claims for unfair labor practice, reimbursement for illegal deductions (ranging from P160 to P900) for tollgate fees taken without his written consent, and for payment of service incentive leave pay.

Genesis Transport argued that Taroy’s dismissal was justified by a series of infractions, including poor driving skills, tardiness, gambling on the premises, use of shabu, smoking while driving, and insubordination.
The company asserted that due process was observed: Taroy was preventively suspended, requested to explain in writing his involvement in the accident, and was subjected to a hearing that considered both its own expert opinions and that of an independent entity (Columbian Motors Corporation).

The Labor Arbiter ruled that Genesis Transport had discharged its burden of proof by showing that Taroy’s termination was for a valid cause and that the requirements of notice and hearing were satisfied despite evidence of habitual infractions.
On the claim for tollgate fee deductions, the Labor Arbiter found in favor of Taroy, holding that the unauthorized deductions from gross revenues diminished his take-home pay, thus amounting to an illegal deduction.
The Labor Arbiter dismissed Taroy’s claims for illegal dismissal and service incentive leave pay, while ordering a refund of the underpayment computed at P5,273.16.

The NLRC affirmed the Labor Arbiter’s decision with modifications—most notably deleting the award for attorney’s fees and dismissing Taroy’s new claim regarding illegal preventive suspension raised for the first time on appeal.
The Court of Appeals, in a subsequent decision, ruled that although there was a valid cause for dismissal, Taroy was entitled to nominal damages (P30,000) because his statutory right to due process was violated by his preventive suspension exceeding the 30-day period as provided under the Implementing Rules and Regulations of the Labor Code.
Petitioners argued that prior NLRC cases and established company practice should render the present claim as res judicata and negate the refund of underpayment, asserting that the delayed service of the dismissal notice was due to Taroy’s own inaction.

Whether Taroy’s dismissal, based on his reckless driving and previous infractions, constituted a valid cause under the law.
Whether the preventive suspension and the subsequent termination process complied with the statutory requirements of due process, particularly regarding the 30-day suspension rule.

Whether the deduction of tollgate fees from the gross revenues—thereby reducing the basis for computing Taroy’s 9% commission—was lawful, especially in light of the lack of his written consent, as mandated under Article 113 of the Labor Code.
Whether classification of such deductions as part of “overhead expense” is acceptable even when it effectively diminishes the wage computation of drivers.

Whether the issue of preventive suspension (specifically, its alleged excessive duration) could be raised for the first time on appeal, given the rule that matters not raised in the lower tribunal generally will not be entertained on appeal.
Whether the appellate court correctly applied the due process requirements by awarding nominal damages, despite evidence that the employer acted within the prescribed period.

Whether the petitioners’ reliance on previous NLRC rulings effectively invokes res judicata, thereby precluding Taroy’s claim for refund of underpayment.
Whether the rule on judicial notice can be applied to accept as fact the alleged accepted “company practice” of deducting tollgate fees, considering the strict requisites for judicial notice.