G.R. No. 80728 February 21, 1990
PEARL S. BUCK FOUNDATION, INC., petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION (Third Division) and RUBINI GOSIACO QUERIMIT, respondents.

FACTS

Petitioner Pearl S. Buck Foundation, Inc., a charitable non-stock, non-profit institution, provides financial, educational, and medical assistance to indigent Amerasian youth. It operates through funds from U.S. donors, which are allocated as trust funds for individual wards. Private respondent Rubini Gosiaco Querimit was employed by the Foundation as a case worker in its Olongapo City branch. One of her assigned wards was Richard Aliarte, son of Andrea Aliarte.
In 1985, Querimit borrowed P3,000 from Andrea Aliarte, the mother of a ward. Andrea Aliarte later sought the Foundation’s assistance to collect the debt. Querimit repaid the loan after pressure from the Foundation. Subsequently, the Foundation dismissed Querimit effective April 30, 1985, on grounds of loss of trust and confidence, alleging the borrowed money came from the ward’s trust fund and that Querimit had also borrowed and failed to return various Foundation properties. Querimit filed a complaint for illegal dismissal. The Labor Arbiter dismissed her complaint, finding her actions constituted serious misconduct and breach of trust. On appeal, the NLRC reversed the Arbiter’s decision, ordering Querimit’s reinstatement with full backwages, ruling the loan was a personal transaction and not a valid ground for dismissal.

ISSUE

Whether the dismissal of Querimit on the ground of loss of trust and confidence was valid.

RULING

Yes, the dismissal was valid. The Supreme Court reversed the NLRC decision and reinstated the Labor Arbiter’s ruling. The legal logic centers on the nature of the employer as a charitable foundation handling trust funds for beneficiaries and the corresponding fiduciary duty of its employees. Querimit, as a case worker directly managing the welfare of wards, occupied a position of utmost trust. Borrowing money from a ward’s mother, from whom the only logical source of funds was the trust allocation for the child, constituted a clear conflict of interest and a breach of that fiduciary duty. This act, coupled with her unauthorized borrowing of Foundation property, eroded the trust essential to her employment.
The Court emphasized that employees of charitable institutions funded by donations must adhere to a stricter ethical standard. The absence of a written office policy prohibiting such transactions was immaterial, as the ethical breach was inherent in the act itself. The retraction of Andrea Aliarte’s complaint did not absolve Querimit, as the fact of the loan remained. Furthermore, Querimit’s own affidavit expressed disinterest in reinstatement due to strained relations, making compelled reinstatement oppressive. Thus, the dismissal for loss of trust and confidence was for a just cause under Article 283 of the Labor Code.