Facts:

Cheryll Santos Leus (petitioner) was employed by St. Scholastica's College Westgrove (SSCW), a Catholic educational institution located in Silang, Cavite, as an Assistant to the Director of the Lay Apostolate and Community Outreach Directorate in May 2001. In 2003, she became pregnant out of wedlock after engaging in pre-marital sexual relations with her boyfriend. Upon learning of her pregnancy, Sr. Edna Quiambao, the Directress of SSCW, advised the petitioner to submit a resignation letter effective June 1, 2003. The petitioner refused to resign, asserting that her pregnancy should not be a reason for her dismissal. On May 28, 2003, Sr. Quiambao formally directed the petitioner to explain in writing why she should not be dismissed for serious misconduct, citing her pre-marital sexual relations and subsequent pregnancy as grounds for dismissal. The petitioner responded on May 31, 2003, arguing that her pregnancy did not constitute serious misconduct and requested a copy ...

Facts:

1. Employment and Position: Cheryll Santos Leus (petitioner) was hired by St. Scholastica’s College Westgrove (SSCW), a Catholic educational institution, as a non-teaching personnel, specifically as an Assistant to the Director of the Lay Apostolate and Community Outreach Directorate.

2. Pre-Marital Pregnancy: In 2003, the petitioner engaged in pre-marital sexual relations with her boyfriend, resulting in pregnancy out of wedlock. She later married the father of her child.

3. School’s Reaction: Upon learning of the petitioner’s pregnancy, Sr. Edna Quiambao, SSCW’s Directress, advised her to resign. The petitioner refused, stating that her pregnancy was a private matter and not connected to her employment.

4. Formal Charge: On May 28, 2003, Sr. Quiambao formally directed the petitioner to explain why she should not be dismissed for engaging in pre-marital sexual relations, which SSCW considered as serious misconduct and conduct unbecoming of an employee of a Catholic school.

5. Petitioner’s Defense: The petitioner argued that her pregnancy out of wedlock did not amount to serious misconduct or conduct unbecoming, as there was no explicit school policy prohibiting such conduct. She requested a copy of SSCW’s policies to better respond to the charge.

6. School’s Policy Reference: SSCW cited Section 94(e) of the 1992 Manual of Regulations for Private Schools (1992 MRPS), which lists "disgraceful or immoral conduct" as a ground for dismissal, in addition to the just causes under the Labor Code.

7. Termination: On June 11, 2003, SSCW terminated the petitioner’s employment, citing her pre-marital sexual relations and pregnancy as disgraceful and immoral conduct, which ran counter to the moral principles of the institution.

8. Legal Action: The petitioner filed a complaint for illegal dismissal with the National Labor Relations Commission (NLRC), arguing that her dismissal was without just cause and constituted an abuse of management prerogative.

Issue:

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Ruling:

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Ratio:

1. Private Conduct vs. Employment: The Court distinguished between an employee’s private conduct and their professional duties. The petitioner’s pre-marital sexual relations and pregnancy, while contrary to Catholic teachings, did not directly affect her job performance or the school’s operations. Thus, it could not be considered a valid ground for dismissal.

2. Burden of Proof on Employer: The Court reiterated that the burden of proving just cause for dismissal lies with the employer. SSCW failed to provide substantial evidence that the petitioner’s conduct had a detrimental effect on the school’s moral environment or its students.

3. Separation Pay in Lieu of Reinstatement: Given the strained relations between the petitioner and SSCW, the Court deemed it impractical to reinstate her. Instead, she was awarded separation pay equivalent to one month’s salary for every year of service.

4. No Moral and Exemplary Damages: The Court found no evidence of bad faith or malice in SSCW’s actions. Therefore, the petitioner was not entitled to moral and exemplary damages, despite the illegal dismissal.

5. Legal Interest on Monetary Awards: The Court imposed a legal interest of 6% per annum on the monetary awards from the finality of the decision until fully paid.