Title
Pampanga II Electric Cooperative, Inc. vs. National Labor Relations Commission
Case
G.R. No. 107541
Decision Date
Nov 16, 1995
A bill collector dismissed for failing to account for P75,238.87 in unremitted collections; Supreme Court upheld dismissal, citing loss of trust and due process compliance.
bill collector
dismissal
due process

Case Summary (G.R. No. 107541)

Factual Background

The Labor Arbiter and the NLRC found that on or about 30 April 1990, Tiglao, while on his way home after his usual bill collections in his area of assignment, encountered three men under the influence of liquor who invited him to a drinking session in a nearby store. Tiglao recognized the men and, fearing trouble, he declined the invitation and ran away. During the incident, he lost his clutch bag, which contained personal items, including P5,000.00 cash and several receipts for collectible electric bills amounting to approximately P70,000.00. Tiglao reported the loss that same date to the Barangay Captain, together with councilmen, but their attempts to locate the bag failed.

On 02 May 1990, Tiglao informed the Cooperative’s Area Manager, Virgilio Yambao, about what happened and suggested that he would continue collecting the amounts reflected in the missing duplicated receipts based on his personal records. Notwithstanding this, Yambao ordered an internal audit, which later confirmed that Tiglao had unremitted payments corresponding to electric power consumed by several residents, totaling P75,238.87. Based on the audit report, Yambao sent Tiglao a memorandum on 27 July 1990 directing him to settle immediately. On 08 August 1990, Tiglao responded by proposing payment through salary deduction beginning 15 August 1990 in installments and continuing monthly until fully paid, or alternatively executing a Deed of Conveyance over his real property assessed at not less than P100,000.00 as satisfaction of the obligation.

On 23 August 1990, Yambao rejected Tiglao’s proposal and gave him five (5) days to settle to avoid termination and possible criminal liability. On 31 August 1990, Nicdao communicated that Tiglao was accountable for the P75,238.87 representing collection money not remitted, that Tiglao had not settled within the period, and that this was not the first such incident. The General Manager also cited other alleged irregularities, including absenteeism and deliberate disregard of prior memoranda and reprimands, and imposed an indefinite suspension without pay effective 03 September 1990.

After receiving the suspension notice, Tiglao sought recourse through the union grievance committee and also appealed to Nicdao in a letter dated 15 September 1990, but he claimed no action followed. PELCO II later placed him under an instruction to stop collecting bills, and when consumers voluntarily paid their accounts, the Cooperative allegedly deducted the amounts against Tiglao’s alleged obligation. On 07 November 1990, Nicdao delivered a termination letter effective immediately, citing Tiglao’s failure to settle the remaining amount of P72,278.87.

Labor Arbiter’s Ruling

The Labor Arbiter found PELCO II guilty of illegal dismissal and unfair labor practice, ordering reinstatement of Tiglao to his former position with full backwages and benefits, and awarding moral and exemplary damages and attorney’s fees. The award included backwages of P57,280.00, additional monetary benefits for thirteenth month pay and sick leave and vacation leave, moral damages of P20,000.00, exemplary damages of P10,000.00, and partial attorney’s fees of P10,160.00, for a total of P101,600.00.

NLRC’s Disposition and Modification

On appeal, the NLRC affirmed the Labor Arbiter’s decision with modification. The NLRC recomputed backwages, limited them to not exceed three (3) years, deleted the award of moral and exemplary damages, reduced attorney’s fees to P1,432.00, and absolved PELCO II from the unfair labor practice charge.

Petitioners’ Arguments

PELCO II and Nicdao challenged the NLRC, asserting that it gravely erred in concluding that there was no evidence of an anomaly because Tiglao himself admitted liability in his August 8, 1990 letter proposing payment. They invoked Rule 130, Section 26 of the Rules of Court, asserting that a party’s admission may be used against him, and argued that the NLRC’s disregard of the letter constituted grave abuse of discretion.

They also maintained that the nature of Tiglao’s position as bill collector required the highest degree of honesty, and that under Art. 283 (now 281) of the Labor Code, termination may be based on fraud or willful breach of trust, where loss of confidence need not be supported by proof beyond reasonable doubt of misconduct. They relied on the doctrine that it suffices that the employer has reasonable grounds to believe the employee is responsible and is unworthy of the trust required by the position.

Further, petitioners argued that the NLRC erred in treating the loss as mere “unremitted bills” without proof that Tiglao had actually collected the bills. Petitioners contended that it was contrary to human experience for Tiglao to propose payment by payroll deduction or by executing a deed of conveyance if he had not collected the amounts.

Finally, petitioners argued that Tiglao was not denied due process because a sequence of communications preceded the dismissal.

NLRC/OSG Position

The OSG, appearing for the NLRC, defended the result by maintaining that petitioners’ evidence was insufficient to prove misappropriation. It further posited that, consistent with the NLRC finding that there was no proof of Tiglao’s failure to account for collections, moral and exemplary damages were properly deleted because any loss of receipts was attributed to Tiglao’s own negligence.

Legal Issues Presented

The petition required the Court to resolve, in substance, whether: first, there was sufficient evidence to justify dismissal on the ground of loss of trust and confidence in a bill collector who admitted liability; and second, whether Tiglao was dismissed without the notices and opportunity to be heard required by due process in employer-initiated termination.

The Court’s Ruling: Decision Reversed and Complaint Dismissed

The Court set aside the decisions of the Labor Arbiter and the NLRC and dismissed Tiglao’s complaint in NLRC Case No. L-00045 (RAB-III-01-1949-91).

Legal Basis and Reasoning

On the first issue, the Court held that an employer has the right to dismiss an employee due to loss of trust and confidence, but the exercise of that right must rest on just and lawful causes substantiated by evidence. It rejected the Labor Arbiter’s and NLRC’s characterization that there was “not an iota of evidence” of involvement in an anomaly. The Court emphasized that evidence existed showing that Tiglao collected P75,238.87 from PELCO II member-consumers and that such evidence came from Tiglao’s own acts and admissions.

Specifically, the Court noted that Tiglao explained the disappearance of his clutch bag by alleging that he fled from men he feared might harm him. The Cooperative did not accept this explanation. Instead, on July 27, 1990, it sent a memorandum stating that audit showed Tiglao had unremitted bills totaling P75,238.87, which he was directed to settle. Rather than insist on his story, Tiglao acknowledged his obligation and proposed payment by salary deductions or by conveying real property to satisfy the liability. The Court quoted Tiglao’s August 8, 1990 memorandum in which he proposed a payment schedule and alternatively offered a deed of conveyance, thereby treating the P75,238.87 as a debt he had incurred. The Court ruled that this admission was admissible against Tiglao under Rule 130, Section 26 and that, in view of that admission, the employer did not need to prove beyond that point that the bills were already collected and not remitted.

The Court further observed that it was clear Tiglao had made collections because the fact pattern found by the agencies placed him “on his way home after the usual collection of electric bills” in his official assignment area when he encountered the men. It treated an affidavit by some consumers that Tiglao had not yet collected from them as insufficient to prove that he had not collected from the remaining consumers under his charge. The Court also invoked the principle that social justice does not shield wrongdoing, especially where the employee is not a mere ordinary worker but a bill collector whose job depends on the utmost trust and confidence. It noted that it had affirmed dismissals of bill collectors found guilty of misappropriation of money on precisely this ground.

On the second issue, the Court rejected the conclusion that Tiglao was dismissed without due process. It referred to the doctrine in Tiu v. NLRC that, under Art. 277 of the Labor Code and the implementing Rules of Court governing labor, two written notices must be given before dismissal: first, notice apprising the employee of the particular acts or omissions for which dismissal is sought (the equivalent of a charge); and second, notice informing the employee of the dismissal issued after the employee had a reasonable opportunity to answer and to be heard.

The Court held that these requirements were met based on the sequence of documents in the record. It identified the July 27, 1990 memorandum to Tiglao directing him to settle unremitted bills totaling P75,238.87 as the first notice of the charge. It then treated Tiglao’s August 8, 1990 response as

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