G.R. No. L-58630 November 26, 1983
SAN MIGUEL CORPORATION, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION and RODOLFO REBOLOS, respondents.

FACTS

Rodolfo Rebolos was a salesman for San Miguel Corporation (SMC) authorized to drive company vehicles and remit daily collections. In 1976, he figured in a vehicular accident while driving a company truck. SMC furnished a P7,000 cash bail bond for the criminal case filed against him, which Rebolos posted in his name. The case was dismissed in November 1977. Six months later, in May 1978, Rebolos withdrew the cash bond from the court without informing SMC and retained the money. The company discovered the withdrawal in August 1979 and immediately demanded the amount, which Rebolos remitted the same day. During a company investigation, Rebolos admitted he kept the bond “for safekeeping with our family funds” for over a year but claimed he never used it. SMC sought to terminate him for misappropriation and breach of trust.
The Labor Arbiter granted SMC’s application for clearance to terminate, finding just cause. On appeal, the NLRC, while acknowledging Rebolos unreasonably kept the money and failed to satisfactorily explain the delay, modified the decision. It ordered his reinstatement without backwages, considering his nine years of service and the incident as an isolated one not involving his regular work, deeming dismissal too severe.

ISSUE

Whether the NLRC committed grave abuse of discretion in ordering Rebolos’s reinstatement despite findings that he breached the trust and confidence reposed in him by his employer.

RULING

Yes. The Supreme Court reversed the NLRC and reinstated the Labor Arbiter’s decision, upholding the dismissal as valid. The Court clarified that while the element of conversion for personal gain was absent, thus negating criminal misappropriation, Rebolos’s actions constituted a willful breach of trust under Article 283(c) of the Labor Code. As a salesman entrusted with company funds and property, he had a duty to immediately account for and remit the P7,000 upon its withdrawal, as it constituted company money advanced on his behalf due to his employment. His unjustified retention of the sum for one year and three months, merging it with his family funds without authorization, and his failure to voluntarily return it until demanded, demonstrated a fundamental betrayal of the fiduciary responsibility inherent in his position. The Court emphasized that the employer’s loss of trust and confidence need not be based on acts involving the employee’s regular duties, and the prolonged unauthorized withholding of company funds by itself sufficed. Reinstatement was deemed irreconcilable with the broken trust, and the NLRC’s substitution of its judgment on the appropriate penalty constituted grave abuse of discretion. The dismissal was a just and legal exercise of management prerogative.