Title
Bristol Laboratories Employees' Association vs. National Labor Relations Commission
Case
G.R. No. 87974
Decision Date
Jul 2, 1990
Employee dismissed for unauthorized stock withdrawals and breach of trust; NLRC erred in remanding case; Supreme Court upheld dismissal, denied separation pay.
national labor relations commission
territory manager
serious misconduct

Case Summary (G.R. No. 87974)

Factual Background: The Allegations of Unauthorized Stock Withdrawals

The reports alleged two separate transactions. First, with Customer No. 10590—Farmacia Carillo in Alaminos, Pangasinan, for P25,603.60 per Invoice No. 619085 dated August 25, 1986, Gata allegedly withdrew stocks without authority and issued two personal checks that later bounced. Second, with Customer No. 10661—the Dr. Gregorio de Guzman Medical Clinic in San Fabian, Pangasinan, for P16,527.50 per Invoice No. 61959 dated September 18, 1986, Gata allegedly again withdrew stocks without authority and issued three personal checks, two of which bounced upon maturity. The records further showed that Gata was able to replace one of the checks issued to Farmacia Carillo by paying two installments of P5,000 each.

Gata’s immediate supervisor, district manager J.L. Atanacio, conducted a separate investigation and submitted a report dated March 20, 1987 confirming the findings of Mariazeta. Based on the reports, the company’s personnel manager J.F. Fuentes, Jr. issued a memorandum on March 30, 1987 directing Gata to explain in writing within ten days, or until April 12, 1987, why his employment should not be terminated for cause due to the unauthorized withdrawals. The company also placed him under preventive suspension for an indefinite period. Gata made only a vague general denial.

Company Investigation, Dismissal, and the Filing of the Labor Complaint

A formal investigation was held on April 29, 1987 by the personnel department. During that proceeding, Gata, represented by counsel Atty. Nitura and the union president Santiago Espino, was confronted with twelve (12) documents (Annexes 5 to 16 of the written reports) purportedly evidencing the unauthorized stock withdrawals in violation of the company’s Rules on Conduct With Physicians and its Trade/Outlet Policy of Stock Withdrawal. After Gata reiterated his denials, the company dismissed him through a memorandum for serious misconduct and wilful breach of trust.

On August 19, 1987, Gata filed a complaint in the Ministry of Labor and Employment, seeking relief for illegal dismissal, illegal suspension, withholding of benefits, and violation of the CBA. After five hearings, the Labor Arbiter rendered a decision on July 28, 1988, dismissing the complaint for lack of merit but ordering payment of separation pay equivalent to one month for every year of service, computed at P19,000.

Proceedings Before the NLRC and the Contested Resolutions

Gata and the union appealed to the NLRC in NLRC-NCR Case No. 00-08-02892-87. The company opposed the appeal and attached various supporting documentary evidence. On March 7, 1989, the NLRC issued a resolution vacating or setting aside the Labor Arbiter’s decision and remanded the case to the Labor Arbiter for reception of evidence and further proceedings, stating that the remand was “for proper evaluation of the evidence adduced in line with the requirements of due process.” On April 10, 1989, the NLRC denied the complainants’ motion for reconsideration, prompting the petition for certiorari before the Supreme Court.

The petitioners asserted that the NLRC committed grave abuse of discretion: first, by considering the employer’s allegedly unverified opposition to the appeal and evidence introduced for the first time on appeal; and second, by remanding rather than deciding the case on the merits.

The Parties’ Contentions on Certiorari

The petitioners’ first assigned error challenged the NLRC’s appreciation of additional documentary evidence submitted by the company on appeal, particularly in relation to the employer’s alleged failure to file a position paper and the status of its opposition. The petitioners also contended that the NLRC should not have treated the matter as one requiring further proceedings, since the Labor Arbiter had already decided on the merits.

The petitioners’ second assigned error focused on the NLRC’s remand. They argued that the NLRC should have resolved the appeal on its merits instead of directing the Labor Arbiter to receive further evidence and conduct additional proceedings.

The Court, applying Art. 221 of the Labor Code, rejected the formalistic objections raised by petitioners concerning procedural posture and emphasized that labor proceedings are not governed by rigid technicalities.

Supreme Court Ruling on Issues: Consideration of Evidence and Improper Remand

The Supreme Court held that the petition lacked merit. The Court noted that although the respondent-employer failed to submit a position paper, it was not declared in default because the petitioners did not file a motion to declare the employer in default. The Court further emphasized that procedural technicalities do not strictly apply in proceedings before labor arbiters, which may avail themselves of reasonable means to speedily ascertain the facts of a controversy under Art. 221 of the Labor Code.

On the matter of evidence submitted on appeal, the Court found no grave abuse in the NLRC’s consideration of additional documentary evidence from the employer on appeal, intended to prove breach of trust and loss of confidence as bases for dismissal. The Court also reasoned that even if the additional evidence were disregarded as cumulative, the effect would still not change the outcome because the evidence already in the record was sufficient to support the Labor Arbiter’s finding of a lawful and justifiable termination.

However, the Court found error in the NLRC’s remand to the Labor Arbiter. The Court held that the NLRC could and should have decided the appeal on the merits based on the existing record, rather than ordering further proceedings. The decision cited Columbia Development Corporation vs. MOLE, 146 SCRA 421, where the Court held that balance sheets and income statements submitted only on appeal should have been considered by the Minister of Labor in keeping with Art. 221 of the Labor Code. It also referenced the earlier ruling in Haverton Shipping Ltd. vs. NLRC, 135 SCRA 685, reiterating that appellate consideration of additional evidence is consistent with the statutory directive.

Findings on Due Process and Substantial Evidence for Dismissal

The Court adopted the Labor Arbiter’s factual findings as supported by substantial evidence and binding. The Labor Arbiter had found that Gata was dismissed for justifiable cause and had been afforded due process consistent with B.P. 130. The Labor Arbiter noted that the company charged Gata with unauthorized stock withdrawals based on reports from two district managers who independently conducted investigations. The reports allegedly contained detailed accounts of transactions involving two outlets or customers. The Labor Arbiter found that the company’s policy allowed products to be withdrawn from outlets only upon prior approval of the National Sales Manager and for implementation by the district manager. Therefore, the company had a basis to believe that Gata personally withdrew stocks in violation of company policy.

The Labor Arbiter treated Gata’s position as one of responsibility. As territory manager, he was required to assist the effective distribution of the company’s products. The Labor Arbiter held that the position entailed the employer’s trust and confidence, and that breach of such trust could justify termination. The Labor Arbiter also invoked jurisprudence on dismissals of employees occupying positions of responsibility, emphasizing the relevance of trust and confidence. It further found that Gata was afforded due process through a memorandum requiring him to explain the reporte

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