Title
Blue Dairy Corp. vs. National Labor Relations Commission
Case
G.R. No. 129843
Decision Date
Sep 14, 1999
Elvira Recalde, a food technologist, was constructively dismissed after an unjustified transfer to menial tasks, deemed unreasonable and humiliating. The Supreme Court upheld her reinstatement, back wages, and premium pay, ruling the company violated labor laws.

Case Summary (G.R. No. 129843)

Incident of Alleged Dishonesty

Recalde reported for work on May 22, 1994, but claimed she did not receive her premium pay for working on a Sunday. An incident on October 21, 1994, involving damage to a company vehicle prompted accusations against her; specifically, she was said to have used the vehicle for personal purposes during office hours. Subsequent to this, on December 3, 1994, she was transferred to a lower position in the vegetable processing section, which she perceived as demeaning and humiliating, and she ceased reporting to work on December 14, 1994.

Legal Claims Filed

On December 16, 1994, Recalde filed a complaint against the petitioners for constructive dismissal and non-payment of premium pay. She also sought overtime compensation, moral and exemplary damages, and attorney's fees. The petitioners countered that her transfer was justified due to loss of trust and confidence as a result of her alleged dishonesty.

Labor Arbiter's Findings

The Labor Arbiter ruled in favor of Recalde, finding that her transfer constituted constructive dismissal. This decision was based on several factors: the unofficial trip taken with the Production Manager did not warrant the drastic employment change; no loss of trust could justifiably occur without the employee being allowed to defend herself; and the humiliation associated with the new job assignment was significant. Furthermore, the Arbiter noted that petitioners failed to pay Recalde Wages for her work performed on May 22, 1994.

NLRC's Affirmation of Labor Arbiter's Decision

On April 30, 1997, the NLRC affirmed the Labor Arbiter’s ruling, further denying petitions for reconsideration in June 1997. Petitioners maintained that the transfer was a legitimate managerial prerogative, yet the NLRC upheld the previous findings on the grounds of due process and appropriate justifications for the transfer being unmet.

Management Prerogative vs. Employee Rights

Petitioners contended that the exercise of management prerogative allowed them to transfer Recalde, not amounting to constructive dismissal. However, case law establishes that such transfers must be justifiable and not demote an employee or significantly alter their work conditions. Management's privileges are limited by the necessity to avoid unreasonable, inconvenient, or prejudicial changes to an employee's position.

Unreasonable Transfer

The Court found the petitioners could not adequately justify the transfer of Recalde, focusing on her previous role as a food technologist, which was significantly more technical and

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