Title
Government Service Insurance System vs. Velasco
Case
G.R. No. 196564
Decision Date
Aug 7, 2017
GSIS employee Velasco, a union president, was unjustly reassigned, charged, and dropped from rolls; SC ruled reassignment and charges void, reinstating him with back pay due to due process violations and union rights infringement.

Case Summary (G.R. No. 196564)

Timeline and Applicable Law

The events primarily occurred in the early to mid-2000s, with key decisions rendered, including the Supreme Court’s decision dated August 7, 2017. This mandates the application of the 1987 Philippine Constitution. Relevant legal frameworks include the GSIS Act of 1997 (Republic Act No. 8291), the Civil Service Law and Rules, particularly the Uniform Rules on Administrative Cases in the Civil Service, and the collective bargaining agreement (CNA) between GSIS and KMG.

Background of Administrative Proceedings and Earlier Court Decisions

Velasco and his colleague Molina were initially charged with grave misconduct for alleged involvement in employee protests against GSIS management. PGM Garcia ordered a 90-day preventive suspension without pay. Velasco and Molina contested the jurisdiction of the GSIS investigatory committee through petitions before the CSC and the Court of Appeals. The CA ruled that GSIS was perpetually restrained from hearing and investigating the charges, which was later affirmed by the Supreme Court. The CSC, however, later ordered GSIS to continue formal investigations, a resolution reversed by the CA on grounds of nullity for lack of preliminary investigation, a ruling again upheld by the Supreme Court in consolidated cases G.R. Nos. 157383 and 174137.

Conflicting Memoranda and Reassignment Orders

In 2004, two conflicting GSIS memoranda were issued regarding Velasco’s status: (1) a June 29, 2004 Memorandum disqualifying Velasco from serving as GSIS Attorney during his term as union president (citing conflict of interest), and offering transfer or leave options; (2) a July 1, 2004 OSVP Office Order assigning Velasco to Mindanao field offices temporarily to augment the legal staff due to surmounting cases, with effectivity to start immediately and remain until further notice. This order contradicted the first by recognizing Velasco’s expertise and did not acknowledge the conflict of interest issue. Velasco sought clarification about these contradictory directives. In response, GSIS accused Velasco of insubordination for resisting the reassignment, triggering further administrative charges.

Allegation of Gross Discourtesy and Union Rights Assertion

As union president, Velasco challenged a GSIS memorandum that prohibited union activities during office hours, citing the CNA provisions that authorize union officers to perform union functions on official time. His demand for recall of the prohibitive memorandum led to a formal administrative charge for gross discourtesy. Velasco defended his actions as rightful assertion of contractual union rights.

Petition for Certiorari and Removal from the GSIS Rolls

Velasco filed a petition for certiorari and prohibition with the RTC to stop enforcement of the reassignment and charge orders. The RTC dismissed the petition for improper venue. While the petition was pending, GSIS filed two formal charges against him for gross discourtesy and insubordination and eventually dropped him from employment rolls on the ground of alleged continuous absence without approved leave (AWOL) exceeding 30 days, despite Velasco’s presence at the Head Office. Velasco then sought relief from the Court of Appeals.

Court of Appeals Decision and Orders

On November 30, 2010, the Court of Appeals declared void the reassignment order, the formal charges of gross discourtesy and insubordination, and Velasco’s removal from the rolls. It ordered GSIS to reinstate Velasco to his former or an equivalent position with back salaries for the period of unlawful separation. GSIS’s motion for reconsideration was denied. GSIS then filed this petition for review on certiorari before the Supreme Court.

Issues Raised by GSIS

GSIS contended that:

  1. Velasco engaged in forum shopping by pursuing multiple petitions simultaneously;
  2. Velasco failed to exhaust administrative remedies by bypassing CSC appeal mechanisms; and
  3. GSIS’s actions were justified by a ruling of the Public Sector Labor-Management Council (PSL-MC), which disqualified GSIS lawyers from union membership or holding union office due to conflict of interest.

Supreme Court’s Ruling on Forum Shopping

The Court found no forum shopping, as Velasco withdrew his motion for reconsideration before the RTC prior to filing before the CA. The petitions raised distinct causes of action and sought different reliefs, thus negating the elements of forum shopping as defined in jurisprudence. No risk of conflicting decisions or vexatious multiplicity of suits existed.

Exhaustion of Administrative Remedies and Exception for Patent Illegality

GSIS’s claim regarding failure to exhaust administrative remedies was considered in the light of recognized exceptions to the doctrine. The Court reiterated jurisprudential exceptions where direct court intervention is allowed, including violations of due process, purely legal issues, and patently illegal administrative actions marked by lack or excess of jurisdiction. After careful review, the Court held that GSIS’s actions were patently illegal and tainted with bad faith. The conflicting memoranda, the unjustified reassignment, the failure to conduct due process before removal, and the premature dropping from the rolls substantiated this finding. Thus, the case fell squarely within exceptions to the exhaustion rule.

Validity of Reassignment Order and Charges of Insubordination and Gross Discourtesy

The Court upheld the CA’s factual finding that the reassignment lacked valid cause and was used to weaken union leadership, noting the shortage of lawyers in the GSIS Head Office at the time undermined the purported exigency justification. Since the reassignment was invalid, the insubordination charge, which depended on refusal to obey said order, likewise failed. The charge of gross discourtesy, arising from a union president’s communication asserting contractually recognized rights under the CNA, was deemed an abuse of discretion and must be considered in the broader context of the right to unionize. The GSIS's failure to effectuate any decision or ruling on the formal charges during the proceedings further invalidated their administrative nature.

Dropping from the GSIS Rolls and Due Process Violations

Velasco was removed not on the charges for which formal proceedings were ongoing but on the separate ground of AWOL. The Court found that Velasco reported to work at the GSIS Head Office and was not given prior notice of his supposed absences, thus violating the right to explain and due process standards. Precedent from Batangas State University v. Bonifacio was cited to emphasize that an employee who reports for work cannot be summarily dropped for absence, especially absent explicit notification and opportunity to be heard. The GSIS’s conduct evidenced bad faith and arbitrariness in terminating Velasco's employment without valid grounds or proper procedure.

Improper Motive and Violation of Labor Rights

The Court highlighted that GSIS officials admitted loss of confidence in Velasco upon his election as union president, revealing a motive to suppress union activities and remove him based on union involvement rather than lawful cause. The PSL-MC resolution disqualifying GSIS lawyers from union participation was issued after Velasco was dropped and could not justify retroactive disciplinary measures. The right to self-organization under Section 8, Article III of the 1987 Constitution was emphasized as explicitly protecting public employees’ right to form or join unions and collectively bargain, which GSIS sought to undermine unlawfully.

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