G.R. No. 172589 - Nacague vs. Sulpicio Lines, Inc.

Jeffrey Nacague (petitioner) was employed by Sulpicio Lines, Inc. (respondent).
Nacague was hired on 15 June 1995 as "hepe de viaje" (representative) on board the vessel M/V Princess of the World.

On 25 January 2003, Sulpicio Lines received an anonymous letter alleging the use of illegal drugs on board the ship.
On 14 February 2003, Ceasar T. Chico, a housekeeper on board, reported the discovery of drug paraphernalia in the Mopalla Suite Room and asserted that threats to his life were made by Nacague and the Chief Mate.

On 15 February 2003, the company sent a notice of investigation to Nacague detailing charges for alleged drug use and for threatening a co-employee.
When the ship docked at the Port of Manila on 18 February 2003, a random drug test was administered:

Crew members, including Nacague, were taken to S.M. Lazo Medical Clinic.
The test conducted at S.M. Lazo Clinic returned a positive result for methamphetamine hydrochloride (shabu).

On 20 February 2003, a formal investigation was initiated by Sulpicio Lines, while Nacague denied using illegal drugs.
On 23 February 2003, Nacague voluntarily underwent a drug test at Chong Hua Hospital in Cebu City, which yielded a negative result.
Despite the negative confirmatory test, on 7 March 2003, Sulpicio Lines terminated Nacague’s employment via a memorandum citing:

Consideration of available evidence including Nacague’s explanation and the S.M. Lazo Clinic drug test result.
Grounds of grave misconduct and loss of trust and confidence.

Nacague filed a complaint for illegal suspension, illegal dismissal, and for reinstatement with backwages.
On 12 November 2003, Labor Arbiter Ernesto F. Carreon issued a decision in favor of Nacague, declaring that his dismissal was illegal and awarding him separation pay and backwages.
The Labor Arbiter questioned the credibility of the drug test from S.M. Lazo Clinic due to its lack of accreditation by the Dangerous Drug Board, giving greater weight to the Chong Hua Hospital result.
Dissatisfied with the ruling, Sulpicio Lines appealed the decision before the NLRC, which on 21 March 2005 reversed the Labor Arbiter’s decision, affirming that Nacague was dismissed for serious misconduct based on the positive test result.
Nacague’s motion for reconsideration before the NLRC was denied on 31 May 2005.
Nacague then filed a petition for review with the Court of Appeals, which also denied his motion for reconsideration on 19 April 2006.

Whether Sulpicio Lines, Inc. legally terminated Nacague’s employment by complying with both the substantive and procedural requirements under the law.
Whether the evidence presented, particularly the drug test results from S.M. Lazo Clinic (despite the conflicting negative test from Chong Hua Hospital), was sufficient to establish that Nacague committed serious misconduct warranting dismissal.

Whether the S.M. Lazo Clinic drug test was credible, given its lack of accreditation by the Dangerous Drug Board.
Whether the failure to conduct a confirmatory test, as required by Republic Act No. 9165 and Department Order No. 53-03, undermined the legitimacy of using the test result as the basis for termination.

Whether Sulpicio Lines observed the twin-notice requirement and accorded Nacague the full opportunity to be heard and defend himself prior to termination.