G.R. No. 102874 - Lopez vs. Javier

Petitioner Macario R. Lopez was appointed General Manager on a probationary basis by the Board of Directors of La Union Transport Services Cooperative (LUTRASCO) effective December 1, 1989, with a monthly salary of P2,000.00.
His probationary status was a critical factor, as it implied that his continued employment rested on his performance during the trial period.

On April 9, 1990, barely four months after his appointment, petitioner was terminated by the Secretary of the Board of Directors on grounds of loss of trust and confidence and unsatisfactory performance.
Specific charges against him included:

Falsification of a board resolution to improperly benefit himself and the staff.
Neglect in overseeing the inventory of a Diesel pump.
Alleged abandonment of work, malingering, and refusal to accept partial payments, thereby affecting cooperative revenues.
Negligence in notifying members about meetings, causing embarrassment.
Involvement in partisan politics by supporting one group of candidates contrary to the Chairman’s directive.
Delegating his reporting duty improperly.
Willful non-compliance with the terms of a promissory note regarding payroll deductions.
Unauthorized cash advances from diesel sales.

Petitioner filed a complaint for illegal dismissal on April 18, 1990, praying for reinstatement, backwages, damages, and attorney’s fees.
The case was docketed as NLRC CASE NO. RAB-I-04-1088-90 and raffled to Labor Arbiter Emiliano T. de Asis, who on December 26, 1990, rendered a decision declaring the termination illegal and ordering:

Private respondent appealed the Labor Arbiter’s decision to the National Labor Relations Commission (NLRC).
On May 29, 1991, the NLRC modified the award by:

Rejecting the order for petitioner’s reinstatement, citing that his managerial status and probationary period rendered reinstatement detrimental to industrial harmony.
Limiting backwages to three (3) months and awarding a one-month separation pay.
Deleting the awards for moral damages and attorney’s fees.

A subsequent NLRC resolution on September 16, 1991, denied petitioner’s motion for reconsideration.

Petitioner contested that as an employee who was illegally dismissed, he was entitled to three (3) years of backwages without qualification and deduction.
He also argued that the deletion of moral damages and attorney’s fees was baseless since there was evidence indicating that private respondents acted in bad faith.
The Office of the Solicitor General intervened, arguing that the NLRC erred in limiting the backwages on the ground that petitioner was only a probationary employee, emphasizing that labor laws apply uniformly to all employees regardless of status.

Whether the NLRC erred in confining petitioner’s award to limited backwages (three months) and one-month separation pay solely on the basis of his probationary status and managerial position.

Was it proper to forgo reinstatement given his managerial role in consideration of industrial harmony?
Is the computation of backwages correct, particularly in light of petitioner's contention that he is entitled to three (3) years of backwages from the time his compensation was withheld up to the finality of judgment?

Whether the NLRC was justified in deleting the awards for moral damages and attorney’s fees.

Should the absence of evidence proving bad faith or oppressive behavior by the private respondents automatically preclude the recovery of moral damages and attorney’s fees in cases of illegal dismissal?

The broader question regarding the application of Article 279 of the Labor Code and constitutional guarantees of security of tenure irrespective of an employee’s probationary status.