Case Digest (A.M. No. 2009-23-SC)
Facts:
The case revolves around Rural Bank of Cantilan, Inc. (petitioners) and Arjay Ronnel H. Julve (respondent). On August 1, 1997, the respondent was hired by the Rural Bank of Cantilan, Inc. as a management trainee, eventually promoted to the role of planning and marketing officer. On June 18, 2001, William Hotchkiss III, the bank's president and also a petitioner, notified branch managers about the abolition of the planning and marketing officer and remedial officer positions as part of a Personnel Streamlining Program. Consequently, the operations officer was to absorb the functions of these roles.
On July 18, 2001, Hotchkiss issued a memorandum appointing the respondent to the position of Bookkeeper I at the bank’s branch in Madrid, Surigao del Sur, maintaining his prior salary. Initially, the respondent accepted this appointment but later indicated his refusal, citing demotion concerns, including diminished responsibilities and allowances. Following this, Hotchkiss reitera
Case Digest (A.M. No. 2009-23-SC)
Facts:
- Background of Employment
- On August 1, 1997, Rural Bank of Cantilan, Inc. (petitioner) hired respondent as a management trainee.
- Respondent was later appointed as planning and marketing officer.
- Restructuring of Bank Positions
- On June 18, 2001, William Hotchkiss III, president of the bank and co-petitioner, circulated a memorandum to all branch managers.
- The memorandum announced the abolition of the positions of planning and marketing officer and remedial officer as part of the bank’s Personnel Streamlining Program.
- It further stated that the functions of the abolished offices were to be absorbed by the operations officer.
- On July 18, 2001, Hotchkiss sent respondent a memorandum appointing him as Bookkeeper I at the Madrid, Surigao del Sur branch effective immediately with the same salary as his previous position.
- Initially, respondent agreed to the appointment.
- Subsequently, respondent annotated the memorandum, indicating his withdrawal of signature and expressing that he perceived the new appointment as a demotion in both position and allowances, contrary to verbal assurances he had received.
- Dispute Over the New Appointment
- On August 9, 2001, a revised appointment was made by Hotchkiss, instating respondent as Bookkeeper I and Assistant Branch Head at the Madrid branch.
- Respondent did not report for work following the new appointment.
- On September 11, 2001, Hotchkiss directed respondent to explain his failure to assume the new position.
- The following day, respondent submitted a written explanation, citing procedural irregularities such as the immediate retraction of documents he wished to review prior to making an informed decision regarding the newly created position.
- Filing of the Constructive Dismissal Complaint
- On September 14, 2001, respondent filed a complaint for constructive dismissal with the Regional Arbitration Branch No. XIII, National Labor Relations Commission (NLRC) in Butuan City (NLRC Case No. RAB-13-09-00276-2001).
- The Labor Arbiter rendered a decision on January 14, 2002 declaring respondent as constructively illegally dismissed and ordered:
- Reinstatement to his former or equivalent position with full backwages from the time of salary withholding until reinstatement.
- Payment of partial backwages amounting to P57,165.33, computed from October 16, 2001, to January 15, 2002, including the prorated 13th-month pay.
- Award of moral and exemplary damages totaling P100,000.00 plus attorney’s fees.
- Subsequent Proceedings and Resolutions
- On appeal, the NLRC, in its Resolution dated November 19, 2002, set aside the Labor Arbiter’s judgment and dismissed the case for lack of merit, ruling that:
- The reassignment of respondent was not a demotion as there was no diminution in functions or pay.
- Respondent had voluntarily failed to report for work despite continuing to receive his salary and allowances.
- Respondent’s motion for reconsideration was denied by the NLRC.
- Respondent then filed a petition for certiorari with the Court of Appeals (CA-G.R. SP No. 77206).
- On September 23, 2004, the Court of Appeals granted the petition:
- It annulled and set aside the NLRC resolutions.
- It reinstated the Labor Arbiter’s decision declaring respondent constructively dismissed.
- Petitioners filed a motion for reconsideration before the Court of Appeals, which was denied on September 6, 2005.
Issues:
- Primary Issue
- Whether the respondent was constructively dismissed from his employment by the petitioners.
- Sub-Issues
- Whether the transfer of respondent from his former position as planning and marketing officer to that of Bookkeeper I and Assistant Branch Head constituted a demotion in rank and pay.
- Whether the abolition of the positions under the bank’s Personnel Streamlining Program and the subsequent reassignment were within the ambit of employer discretion under the management prerogative.
- Whether respondent’s failure to report for work, despite still receiving salaries and allowances, impacted the assertion of constructive dismissal.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)