G.R. No. 152777 - Lacuesta vs. Ateneo de Manila University

Petitioner Lolita R. Lacuesta was initially hired on a contractual basis by Ateneo de Manila University as a part-time lecturer in the English Department for the second semester of school year 1988‑1989.
She was re‑hired under similar contractual terms for the first and second semesters of school year 1989‑1990.
On July 13, 1990, petitioner was first appointed as a full‑time instructor on probation, with her appointment effective from June 1, 1990 until March 31, 1991.
Her probationary contract was renewed subsequently:

On January 27, 1993, a letter from Dr. Leovino Ma. Garcia, Dean of the Graduate School and College of Arts and Sciences, notified petitioner that her contract would not be renewed due to alleged failure to integrate well with the English Department.
Petitioner appealed the decision by writing to the then‑President, Fr. Joaquin Bernas, S.J.

In a letter dated February 11, 1993, Fr. Bernas explained that petitioner was not being terminated; rather, her contract would simply expire.
He clarified that permanent appointments at the university required the dean’s recommendation and confirmation by the Committee on Faculty Rank and Permanent Appointment, cautioning against so‑called “midnight appointments.”

On March 11, 1993, Fr. Bernas offered petitioner an alternative position as a book editor in the University Press under terms comparable to those of a faculty member.

Petitioner was employed as editor in the University Press from April 1, 1993 to March 31, 1994, with an extension of two months beyond the contract expiry.
Following the expiry of her initial editor’s contract, petitioner applied for clearance to collect her final salary.
An extension of her contractual period as editor was agreed upon, covering June 16, 1994 to October 31, 1994.
Petitioner ultimately decided against a further renewal due to a severe back problem.
Although she did not return to work, she submitted her clearance on February 20, 1995.
Earlier, on April 16, 1993, petitioner had signed a Quitclaim, Discharge and Release after applying for clearance on March 26, 1993.

On December 23, 1996, petitioner filed a complaint for illegal dismissal seeking reinstatement, back wages, and both moral and exemplary damages.
The Labor Arbiter, Manuel P. Asuncion, ruled in petitioner’s favor by stating that:

An employee cannot be terminated merely by lapse of the probationary period; termination must be based on just cause or failure to meet employer standards.
The signed quitclaim did not bar her from filing a complaint for illegal dismissal.

The National Labor Relations Commission (NLRC) reversed the Labor Arbiter’s decision on appeal, finding that:

Petitioner sought reconsideration, which was denied.
A petition for certiorari was then filed before the Court of Appeals challenging the NLRC decision.
The Court of Appeals affirmed the NLRC decision and dismissed the petition, concluding that there was no grave abuse of discretion.

Articles 280 and 281 of the Labor Code—not the Manual of Regulations for Private Schools—should determine if a faculty member has acquired permanent status.
Under Article 281, the probationary employment should not exceed six months unless stated otherwise in an apprenticeship agreement; and under Article 280, service of at least one year qualifies for regularization.
She had rendered services for four and a half years as part‑time and full‑time teacher, which should qualify her as a regular employee.
The clearance granted only after signing the quitclaim indicates that the waiver was not truly voluntary.

The Manual of Regulations for Private Schools was controlling, as it sets forth that full‑time teachers with three consecutive years of satisfactory service are considered permanent.
The petitioner’s earlier service as a part‑time lecturer could not be credited toward acquiring permanent status.
The only decision regarding renewal lay with the university, exercising its constitutional prerogative to set internal standards.
The executed quitclaim was valid and should bar any claim for illegal dismissal.

Whether petitioner was illegally dismissed or if her employment simply expired at the end of the probationary period.

Does the expiration of her contract on probation constitute an act of illegal dismissal?
Can a probationary employee claim security of tenure beyond the stipulated probation period without meeting additional standards?

Which legal framework governs the acquisition of regular or permanent status for faculty in an educational institution: the provisions of the Labor Code (Articles 280 and 281) or the Manual of Regulations for Private Schools?

Should the petitioner’s claim for regularization be evaluated under the Labor Code’s provisions?
Or is the Manual of Regulations for Private Schools controlling, given the nature of the employment and the autonomy of academic institutions?

Whether the quitclaim, discharge, and release signed by the petitioner was executed voluntarily and with full knowledge of its implications.
Whether such a document can bar claims of illegal dismissal, moral, and exemplary damages.