G.R. No. 129329 - Asuncion vs. National Labor Relations Commission

Case Summary (G.R. No. 129329)

Petitioner

Christine Joy Capin‑Cadiz filed a complaint for Unfair Labor Practice, Constructive Dismissal, Non‑Payment of Wages and Damages with prayer for reinstatement after she was indefinitely suspended because she became pregnant out of wedlock while single and employed as Brent’s Human Resources Officer.

Respondent

Brent Hospital and Colleges, Inc. relied on its Policy and Employee Manuals (which list “immorality” and “disgraceful or immoral conduct” as dismissible offenses) and on Section 94 of the Manual of Regulations for Private Schools (MRPS) to justify its action and to condition reinstatement upon the employee’s marriage to her boyfriend.

Key Dates and Procedural Posture

Indefinite suspension: 2006 (pregnancy became manifest)
Labor Arbiter decision: April 12, 2007 — found constructive dismissal but concluded there was just cause for dismissal; awarded 13th month pay only.
NLRC Resolution: December 10, 2007 — affirmed LA decision; Motion for Reconsideration denied February 29, 2008.
CA Resolutions: July 22, 2008 and February 24, 2009 — dismissed Cadiz’s Rule 65 petition on procedural defects and found no grave abuse by NLRC.
Supreme Court decision: February 24, 2016 — reviewed both procedural and substantive questions and granted the petition.

Applicable Law

Constitutional framework: 1987 Philippine Constitution (applicable because decision date is after 1990), including constitutional protection of labor and the right to due process and personal liberty/privacy as relevant to the Court’s analysis.
Statutory and regulatory sources considered: Labor Code provisions on stipulations against marriage and related worker protections, Manual of Regulations for Private Schools (Section 94), Republic Act No. 9710 (Magna Carta of Women, Sec. 19(b)), Brent’s internal Policy and Employee Manuals. Relevant jurisprudence cited included Leus (Cheryll Santos Lens v. St. Scholastica’s College Westgrove) and other labor and procedural authorities.

Antecedent Facts

Cadiz and her boyfriend were single, with no legal impediment to marry. They engaged in premarital sexual relations which resulted in pregnancy. Brent discovered the pregnancy when it became manifest and imposed indefinite suspension, advising that reinstatement would be possible only after Cadiz married her boyfriend. Cadiz later married him (April 15, 2008) and earlier brought suit claiming constructive and illegal dismissal and nonpayment claims.

Labor Tribunal Findings

The Labor Arbiter found the indefinite suspension tantamount to constructive dismissal but nevertheless concluded that there was just cause to dismiss Cadiz because her premarital relations and resulting out‑of‑wedlock pregnancy constituted “immoral conduct” punishable by dismissal under Brent’s rules and Article 282(a) (as cited) of the Labor Code. The LA denied reinstatement until marriage and awarded only 13th month pay. The NLRC affirmed the LA.

Court of Appeals Ruling

The CA dismissed the Rule 65 petition on procedural grounds due to (1) incomplete statement of material dates, (2) failure to attach registry receipts proving service, and (3) failure to indicate place of issue of counsel’s PTR and IBP receipts. The CA also held that the NLRC committed no grave abuse in upholding Cadiz’s dismissal.

Issues Presented by Petitioner

Cadiz raised, among others: (I) that NLRC gravely abused its discretion in holding that impregnation outside wedlock is a ground for termination; (II) that requiring her to marry before reinstatement was grave abuse and violated stipulation‑against‑marriage rules; (III) NLRC’s denial of backwages and other monetary claims; and (IV) that the CA misapplied procedural rules in dismissing her petition.

Supreme Court’s Procedural Analysis

The SC examined the CA’s dismissal for procedural defects. It found: (a) failure to state the date of receipt of the NLRC decision was not fatal because the critical date—the receipt of denial of the motion for reconsideration—was alleged; (b) registry receipt numbers written in the petition did not substitute for the requirement that registry receipts be appended, but the absence of receipts is cureable and does not automatically foreclose relief where substantial justice requires relaxation of technical rules; (c) omission of place‑of‑issue of PTR/IBP receipts was substantially complied with when that information appeared in other parts of the pleadings (verification and certification against forum shopping). The Court emphasized that rules of procedure are tools to secure substantial justice and may be relaxed to avoid frustration of substantial justice.

Supreme Court’s Analysis on “Immorality” as Just Cause

The SC applied the two‑step test from Leus: (1) examine the totality of the circumstances surrounding the conduct; (2) evaluate those circumstances against prevailing public and secular norms of morality. The Court held that premarital sexual relations and pregnancy out of wedlock, between two consenting adults with no impediment to marry, do not automatically constitute disgraceful or immoral conduct under public/secular standards. Brent’s manuals used the term “immorality” without defining it and relied on sectarian religious norms; that alone is insufficient to classify conduct as immoral in the public/secular sense. There was no substantial evidence that Cadiz’s conduct scandalized the Brent community; Brent itself admitted knowledge arose only when the pregnancy was manifest and produced no proof of public scandal. Given these considerations and consistent with Leus, the SC concluded the labor tribunals erred in treating Cadiz’s conduct as just cause for dismissal.

Analysis of Marriage as a Condition for Reinstatement

The Court recognized management prerogative but balanced it against constitutional and statutory protections. The 1987 Constitution’s mandate to protect labor and promote equal employment opportunity, and the Labor Code provision prohibiting stipulation against marriage (and analogous protections under RA 9710), render Brent’s condition coercive and discriminatory. Conditioning reinstatement on marriage forces an employee to trade a constitutionally protected choice (whether and whom to marry) for employment — an impermissible burden. The Court further noted that for a marriage‑related qualification to be valid as a bona fide occupational qualification, the employer must prove (1) reasonable relation to essential job functions and (2) factual basis that persons not meeting the qualification cannot perform the job — Brent failed to establish either.

Remedies — Reinstatement, Separation Pay, Backwages, Attorney’s Fees, Interest

The SC declared Cadiz to have been dismissed without just cause. The Court ordered reinstatement without loss of seniority and payment of backwages from the time compensation was withheld until actual reinstatement. If reinstatement proved not viable, the Court ordered separation pay as an alternative at the rate of one month’s salary per year of service, computed from employment commencement to the date of dismissal. Using the record facts (employment from August 16, 2002 to dismissal on November 17, 2006; monthly salary P9,108.70), the Court computed separation pay as P36,434.80 (1 month salary × 4 years). The Court awarded limited backwages of one year only — P109,304.40 (P9,108.70 × 12), on grounds of fairness and equity given the employer’s good faith and that Leus was not yet decided at the time of the suspension. The Court denied moral and exemplary damages for

Case Syllabus (G.R. No. 129329)

Background / Antecedent Facts

Petitioner Christine Joy Capin‑Cadiz (Cadiz) was the Human Resource Officer of respondent Brent Hospital and Colleges, Inc. (Brent).
In 2006 Brent imposed an indefinite suspension on Cadiz for “Unprofessionalism and Unethical Behavior Resulting to Unwed Pregnancy.”
The stated condition for reinstatement communicated by Brent was that Cadiz marry her boyfriend in accordance with law.
Cadiz became pregnant out of wedlock while both she and her boyfriend were single and, according to the record, had no legal impediment to marry.
Cadiz filed a complaint with the Labor Arbiter for Unfair Labor Practice, Constructive Dismissal, Non‑Payment of Wages and Damages with prayer for Reinstatement.

Procedural History

Labor Arbiter (LA) issued a Decision dated April 12, 2007.
Cadiz appealed the LA Decision to the National Labor Relations Commission (NLRC); NLRC issued a Resolution dated December 10, 2007 affirming the LA decision and denied reconsideration in a Resolution dated February 29, 2008.
Cadiz filed a petition for certiorari under Rule 65 with the Court of Appeals (CA) (CA‑G.R. SP No. 02373‑MIN).
The CA dismissed Cadiz’s petition by Resolution dated July 22, 2008 on procedural grounds, and denied her motion for reconsideration in its Resolution dated February 24, 2009.
Cadiz moved for review on certiorari under Rule 45 before the Supreme Court; the petition assailed the CA Resolutions of July 22, 2008 and February 24, 2009.

Labor Arbiter Decision (April 12, 2007)

The LA found that Cadiz’s indefinite suspension amounted to constructive dismissal.
Simultaneously, the LA ruled Cadiz was not illegally dismissed because there existed just cause for dismissal: premarital sexual relations resulting in pregnancy out of wedlock.
The LA characterized the conduct as immoral and magnified as serious misconduct partly because Brent is an institution of the Episcopal Church and partly because Cadiz was the HR Officer charged with implementing Brent’s rules against immoral conduct.
The LA denied reinstatement and backwages, ordering only payment of 13th month pay in the amount of P7,970.11. All other charges and claims were dismissed for lack of merit.

NLRC Ruling and Denial of Reconsideration

The NLRC affirmed the LA Decision in its Resolution dated December 10, 2007.
The NLRC denied Cadiz’s motion for reconsideration in its Resolution dated February 29, 2008.
The NLRC agreed with the LA that Cadiz’s dismissal was valid and grounded on immorality/serious misconduct.

Court of Appeals Ruling(s)

The CA dismissed Cadiz’s petition on procedural/technical grounds: (1) incomplete statement of material dates; (2) failure to attach registry receipts; and (3) failure to indicate the place of issue of counsel’s Professional Tax Receipt (PTR) and Integrated Bar of the Philippines (IBP) official receipts.
The CA, upon perusal of the petition, also found no grave abuse of discretion on the part of the NLRC in upholding Cadiz’s dismissal.
Cadiz’s motion for reconsideration before the CA was denied (CA Resolution dated February 24, 2009).

Issues Presented By Petitioner (as raised in the petition)

Whether the NLRC gravely abused its discretion when it held that Cadiz’s impregnation outside of wedlock is a ground for termination of employment.
Whether the NLRC gravely abused its discretion when it upheld the indefinite suspension and conditioned reinstatement on Cadiz’s marriage to her boyfriend.
Whether the NLRC gravely abused its discretion in denying Cadiz’s claims for backwages, allowances, sick leave pay, maternity pay, moral and exemplary damages, and attorney’s fees.
Whether the CA misplaced application of the “material dates” rule, resulting in grave abuse of discretion when it dismissed the appeal on procedural grounds.

Petitioner’s Principal Contentions

Pregnancy outside of wedlock is not necessarily grossly immoral, particularly where both partners have no legal impediment to marry.
The suspension and the condition that Cadiz marry her boyfriend to be reinstated violated the Labor Code’s prohibition against stipulations against marriage (Article 136 / Art. 134 as cited in the ponencia).
There was substantial compliance with procedural requirements for the CA petition; the CA should not have dismissed it on technical defects.

Respondent’s (Brent’s) Principal Contentions

Brent maintained that Cadiz’s premarital sexual relations and resulting pregnancy were immoral and justified dismissal under its policies.
Brent argued that adopting a narrower view of immorality would change Brent’s norms, beliefs, teachings, and practices as a Church institution of the Episcopal Church in the Philippines.
Brent relied on its Policy Manual, Employee’s Manual of Policies, and Section 94 of the Manual of Regulations for Private Schools (MRPS) as providing grounds for dismissal for “immorality” or “disgraceful or immoral conduct.”

Issues for Resolution by the Supreme Court

Whether the CA erred in dismissing Cadiz’s petition on the noted procedural defects without relaxing or applying substantial justice principles.
Whether the NLRC and LA correctly concluded that Cadiz’s premarital relations and pregnancy out of wedlock constituted immorality justifying dismissal.
Whether Brent’s condition that Cadiz marry her boyfriend as a prerequisite to reinstatement was lawful or violative of statutory and constitutional protections (stipulation against marriage and anti‑discrimination guarantees).

Analysis — Rules of Procedure and Substantial Compliance

The Supreme Court recognized that Rule 46, Section 3 requires petitions to indicate material dates (receipt of judgment / receipt of denial of motion for reconsideration) so CA can determine timeliness.
Cadiz omitted the date of receipt of the NLRC decision but did allege the date of receipt of the resolution denying the motion for reconsideration; the Court held the latter is the more important material date and was duly alleged.
The CA dismissed the petition for failure to attach registry receipts. The Court noted the rule requires the registry receipt to be appended; mere indication of registry receipt numbers is insufficient and absence of the receipt amounts to lack of proof of service.
Despite the registry receipt defect, t