G.R. No. 6 - Gavieres vs. Pardo de Tavera

Respondent was initially employed on November 25, 1985, by petitioner Premiere Development Bank (now Security Bank Savings Corporation [SBSC]) as a messenger.
He was subsequently promoted to loans processor, then to Acting Branch Accountant, and further to Acting Branch Manager.
On March 26, 2008, he was transferred to the Quezon Avenue Branch where he served as Customer Service Operations Head, responsible for safeguarding checkbooks and other bank forms under the supervision of Branch Manager Corazon Pinero.

On July 22, 2008, respondent received a show-cause memorandum from Ms. Ruby O. Go, head of West Regional Operations, charging him with violating the bank’s Code of Conduct because of mishandling checkbooks.
An investigation by SBSC’s Investigation Committee revealed that forty-one pre-encoded checkbooks were missing as of July 11, 2008.
During a scheduled conference, respondent admitted that he had allowed Branch Manager Pinero to remove the checkbooks and other bank forms from the premises. He justified this act as part of Pinero’s marketing strategy and asserted that he received no personal benefit from the practice.
He further explained that the checkbooks had been returned to him after the inventory.

Pending the investigation, respondent was transferred first to the Pedro Gil Branch and later to another branch in Sampaloc, Manila.
Due to the frequent transfers and dissatisfaction with his work assignments, respondent tendered his resignation on November 10, 2008, effective after thirty (30) days.
The bank rejected his resignation and terminated his employment on November 11, 2008, on the basis of habitual neglect of duties.

Respondent filed a complaint for illegal dismissal with the NLRC (docketed as NLRC-NCR Case No. 10-14683-09), seeking backwages, damages, and attorney’s fees.
The Labor Arbiter (LA), in a Decision dated July 26, 2010, dismissed the complaint on the grounds that respondent was validly terminated for gross and habitual neglect of duty.
Despite the LA ruling his dismissal valid, the LA awarded respondent separation pay by way of financial assistance amounting to P218,500.00.

Petitioners (the bank and its president) appealed the LA decision with a focus on the award of separation pay, arguing that respondent’s actions constituted gross negligence warranting dismissal without separation pay.
The NLRC, in a Decision dated April 25, 2011, affirmed the LA ruling, upholding the grant of separation pay as an equitable measure reflecting respondent’s length of service and situational factors.
The Court of Appeals (CA) in its Decision dated May 21, 2014, sustained the award of separation pay, emphasizing that such award may be allowed on social justice grounds when the dismissal is not due to serious misconduct or moral turpitude.

Whether the award of separation pay by way of financial assistance to respondent is proper even though he was validly dismissed for gross and habitual neglect of duty.

Whether the CA erred in sustaining the separation pay award despite the established fact that respondent repeatedly violated company policy.
Whether the social justice exception applies when the act of misconduct is considered serious due to the employee’s critical accountability role in a banking institution.