Title
Amor vs Constant Packaging Corporation/William Chan and Virginia Chan
Case
G.R. No. 259988
Decision Date
May 19, 2025
Pakyaw workers barred entry = illegal dismissal. No constructive dismissal/13th month pay. Burden of proof defined.
illegal dismissal
labor law
due process
A

Case Summary (G.R. No. 259988)

Parties and Setting

The employment arrangement involved pakyaw basis work, with petitioners hired as sorters, revisers, and packers. According to the record, petitioners raised grievances with company management concerning working conditions, including claims of below minimum wage, a twelve-hour work day, a seven-day work week, nonremittance of SSS, PhilHealth, and Pag-IBIG contributions, and delays in the release of salaries. Petitioners also reported these matters to the Department of Labor and Employment. The NLRC and the lower fora treated the question whether the workers were regular employees as distinct from the separate question whether they were illegally dismissed.

Chronology of Material Events

The dispute escalated when Narag and Balanquit were prevented from entering Constant Packaging’s premises after failing to attend the company Christmas Party. Subsequently, Amor and Arambulo were also barred from entering the work premises after management allegedly disliked the concerns they raised regarding the workers’ conditions and benefits, and the delays in salary release. After management received summons from the Department of Labor and Employment, additional petitioners were also prevented from entering the plant. Meanwhile, Busel and Tordillo resigned due to health reasons and the pressure from their supervisor, Imelda Vea.

Company’s Position: No Dismissal and No Employment Control

Constant Packaging denied that it dismissed petitioners. It insisted that petitioners were not terminated because they were allowed to work “anytime” on a pakyaw basis. It also argued that it did not control the workers’ hours of work, that time-in and time-out were not required, and that it did not discipline petitioners for allegedly producing little or no output. Constant Packaging likewise rejected allegations that workers were made to work twelve hours a day and that their daily wage was below the minimum wage. As to petitioners’ claim of illegal dismissal, the company’s narrative was that petitioners abandoned their employment rather than being dismissed.

Labor Arbiter’s Findings: Regular Employment and Illegal Dismissal (Except Two)

The Labor Arbiter ruled in favor of the workers on two points. First, it declared that petitioners—subject to the case’s disposition regarding illegal dismissal—were regular employees. Second, it found that petitioners were illegally dismissed, except for Busel and Tordillo. The Labor Arbiter ruled that, as to the affected workers, they had been barred from entering the premises and prevented from rendering work, and this amounted to an illegal termination absent just or authorized cause and without procedural due process. It ordered the payment of separation pay and backwages in total, and it also awarded thirteenth month pay, reflecting the Labor Arbiter’s conclusion that the workers were entitled to that benefit.

NLRC Proceedings: Regular Employment Confirmed, Illegal Dismissal Reversed

On appeal, the NLRC agreed that petitioners were regular employees, but it reversed the Labor Arbiter’s finding of illegal dismissal. The NLRC held that the “fact of dismissal was not proven” because barring the workers from entering the workplace “cannot be construed as an overt act of termination.” Instead, it ordered the workers to return to work and directed Constant Packaging to accept them back. The NLRC separately found that Busel and Tordillo had voluntarily renounced their employment. It also removed the Labor Arbiter’s award of thirteenth month pay, stating that workers paid on pakyaw basis were excluded from that benefit. It deleted the thirteenth month pay and ordered Constant Packaging to pay service incentive leave and holiday pay, and to accept the workers upon their immediate reporting for work within the period it specified.

Court of Appeals: Petition for Certiorari Dismissed

Amor et al. moved for reconsideration, but the NLRC denied the motion. They then filed a Petition for Certiorari before the Court of Appeals, which dismissed the petition for lack of merit, and denied subsequent reconsideration. The Court of Appeals thus sustained the NLRC view that the evidence did not establish dismissal as such.

Issues on Review: Whether There Was Illegal Dismissal and the Consequence for Monetary Benefits

Before the Supreme Court, the core dispute centered on whether petitioners were illegally dismissed. For the twelve workers other than Busel and Tordillo, Amor et al. argued that the security guard’s repeated act of preventing them from entering the company premises—coupled with the surrounding circumstances—demonstrated that they were not allowed to work, thus constituting dismissal. They emphasized that they had proceeded to the workplace and that management’s order to bar them effectively terminated their ability to work. For Busel and Tordillo, petitioners argued that they were constructively dismissed due to harassment, pressure, and tension from their supervisor, which allegedly led to their resignation.

Constant Packaging countered that petitioners failed to prove dismissal with the required quantum of evidence. It asserted that the absence of a written notice showed there was no dismissal and that the evidence presented was insufficient, amounting to self-serving allegations and hearsay. It also maintained that petitioners were not entitled to separation pay in lieu of reinstatement and to backwages because any loss was attributable to petitioners’ refusal to work, and it reiterated that pakyaw workers were excluded from thirteenth month pay under the implementing rules of Presidential Decree No. 851.

The Supreme Court’s Treatment of the Dismissal Question

The Supreme Court anchored its analysis on the act alleged to be decisive: Constant Packaging’s prevention of petitioners from entering the company premises and rendering work. The Court of Appeals had framed the matter as whether the security guard’s alleged acts could be construed as tantamount to dismissal, and it concluded that they were not. The Supreme Court disagreed. It held that when an employee is able and willing to work, evidenced by the employee’s proceeding to the premises, and the employer arbitrarily prevents the employee from working for no known and valid reason, then the employee suffers illegal dismissal. The Court found that the NLRC and the Court of Appeals misappreciated the significance of the barring acts in relation to the employer’s burden to show a lawful basis for termination.

The Supreme Court rejected the respondents’ reliance on the absence of a written notice as a determinative circumstance. It treated the prevention from reporting and working as the factual event constituting an overt termination. It further explained that respondents could not shift to petitioners the burden for the illegality created by the employer’s own failure to comply with the requirements for a lawful dismissal.

Abandonment and Its Two-Element Requirement

Respondents’ defense, when translated into legal terms, was that petitioners abandoned their employment. The Supreme Court clarified that for abandonment to exist, the employer must show two elements: first, that the employee failed to report or was absent without valid or justifiable reason; and second, that there was an overt act demonstrating a clear intention by the employee to sever the employer-employee relationship. The Court held that abandonment is essentially a matter of intent. It cannot be presumed from equivocal conduct.

Applying these principles, the Court held that Constant Packaging failed to satisfy the second element. Even if petitioners reacted by concluding that barring them from entering the premises meant they were dismissed, that reaction did not prove a deliberate intention to sever the employment relationship. The Court therefore treated respondents’ abandonment theory as unsupported.

Reference to Hubilla and the Equipoise of Evidence

The Supreme Court invoked Hubilla v. HSY Marketing Ltd., Co., where the Court had held that employees being prevented from entering stores did not automatically prove abandonment in the absence of proof of the employee’s clear intent to sever the employment relationship. Consistent with Hubilla, the Supreme Court held that where the parties in a labor case do not present substantial evidence to prove their allegations, the evidence is treated as being in equipoise, and the scales of justice are tilted in favor of labor. Accordingly, petitioners were considered to have been illegally dismissed as to the twelve workers whose entry was prevented and who were able and willing to work.

Affirmance of Facts by the Labor Arbiter: Security Guard as Instrument of Termination

The Supreme Court affirmed the Labor Arbiter’s finding of fact that the respondents’ security guard prevented petitioners from entering the company premises and rendering work. It treated that prevention as an overt act of dismissal. In that respect, it sustained the factual conclusions supported by the manner in which entry and exit were controlled by the security guard stationed at the gate. The Court also noted the Labor Arbiter’s reasoning that the employer’s reply implicitly confirmed that security guards controlled entry and that it failed to convincingly argue that complainants were not prevented from entering.

Busel and Tordillo: No Constructive Dismissal and No Evidence of Oppressive Conduct

For Busel and Tordillo, the Supreme Court maintained the uniform factual findings of the Labor Arbiter, the NLRC, and the Court of Appeals that petitioners failed to substantiate their allegations of oppressive conduct resulting in constructive dismissal. The Court applied the doctrine that constructive dismissal must be proven by the employee, while resignation must be proven by the employer. It reiterated that constructive dismissal lies in the employer’s gratuitous, unjustified, or unwarranted acts that render continued employment unbearable and foreclose t

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