G.R. No. 110062 September 5, 1997
AQUINAS SCHOOL, petitioner, vs. HON. BIENVENIDO S. MAGNAYE, Labor Arbiter, Department of Labor and Employment (NCR) and MARITES M. UMALI, respondents.

FACTS

Private respondent Marites M. Umali was a regular classroom teacher at Aquinas School. On September 30, 1991, she filed an application for sick leave until October 8, 1991, supported by a medical certificate. On October 9, 1991, she reported to work, punched her time card, but immediately left the premises without consent, violating school rules. The school issued a memorandum on October 10, 1991, requiring her to explain her conduct. On October 14, 1991, upon receiving the memorandum, Umali also submitted a request to extend her sick leave until October 25, 1991, and later requested a further extension until November 15, 1991, both supported by medical advice. In a letter dated November 5, 1991, received by Umali on November 11, 1991, the school informed her that her sick leave applications were held in abeyance pending a medical examination by an accredited physician. Umali neither replied nor appeared for the scheduled examination. The school then required her to explain this failure. In response, Umali stated she was under the care of a cardiologist and psychiatrist, as shown by a medical certificate from the National Center for Mental Health. Unsatisfied, the school reiterated its request for her to undergo a medical examination by its physician and to explain her October 9 absence. Umali refused to comply. Consequently, in a letter dated November 19, 1991, the school denied her sick leave applications and terminated her services on grounds of willful disobedience and abandonment due to prolonged unauthorized absence. Umali filed a complaint for illegal termination. The Labor Arbiter found her guilty of willful disobedience but not of abandonment, and ruled she was not accorded due process. However, the Arbiter deemed dismissal too harsh and ordered the school to either reinstate Umali without loss of seniority or pay separation pay equivalent to one month’s pay per year of service, with no backwages. Both parties filed motions for reconsideration, which were denied. The school appealed to the Supreme Court.

ISSUE

1. Whether the Labor Arbiter committed grave abuse of discretion in concluding that Umali did not abandon her work.
2. Whether the Labor Arbiter committed grave abuse of discretion in ordering reinstatement or payment of separation pay despite a finding of gross insubordination and serious misconduct.
3. Whether the Labor Arbiter committed grave abuse of discretion in modifying the computation of separation pay.
4. Whether the Labor Arbiter committed grave abuse of discretion in concluding that the school failed to observe due process.
5. Whether the Labor Arbiter committed grave abuse of discretion in ordering separation pay or reinstatement instead of imposing the P1,000.00 indemnity for lack of due process as per prevailing jurisprudence.

RULING

1. No. The Supreme Court upheld the Labor Arbiter’s finding that Umali did not abandon her work. Abandonment requires: (a) failure to report for work without valid reason, and (b) a clear intention to sever the employment relationship. The second element is more determinative. Umali’s filing of sick leave applications and extensions, in conformity with school practice and supported by medical certificates, negated any intention to abandon her work. The school’s rule that unauthorized absences exceeding seven consecutive days constitute abandonment was interpreted not to apply where the employee had given notice and the school was aware of the reasons for absence. The school failed to prove Umali’s clear and deliberate intent to discontinue her employment.
2. The Supreme Court modified the Labor Arbiter’s order. While the Labor Arbiter found willful disobedience justified dismissal but deemed it disproportionate, the High Court, based on its findings on due process, did not reinstate the separation pay order. Instead, it imposed a monetary penalty on the school for procedural deficiency.
3. This issue was rendered moot by the Supreme Court’s modification of the dispositive portion, which set aside the award of separation pay.
4. Yes. The Supreme Court agreed with the Labor Arbiter that the school failed to observe due process in dismissing Umali. The requisite twin notices and hearing were not properly accorded.
5. Yes. The Supreme Court held that where an employee is dismissed for just cause but due process was not observed, the employer is liable to pay indemnity. Citing prevailing jurisprudence, the Court imposed a penalty of P1,000.00 on the school for its failure to observe due process. The employee is not entitled to reinstatement, back wages, or separation pay in such a case, only indemnity.
WHEREFORE, the decision and resolution of the Labor Arbiter were MODIFIED. The school was ordered to pay Umali the amount of P1,000.00 as penalty for non-observance of due process in her termination.