G.R. No. 139013, September 17, 2002
Zel T. Zafra and Edwin B. Ecarma, Petitioners, vs. Hon. Court of Appeals, Philippine Long Distance Telephone Co., Inc., Augusto Cotelo, and Eriberto Melliza, Respondents.

FACTS

Petitioners Zel T. Zafra and Edwin B. Ecarma were regular rank-and-file employees of respondent Philippine Long Distance Telephone Co. (PLDT), assigned at the Regional Operations and Maintenance Control Center (ROMCC) of PLDT’s Cebu Provincial Division. In March 1995, they were sent to Germany for a training program related to a PLDT project. While they were abroad, PLDT, through an inter-office memorandum, inquired about transferring training participants to the Sampaloc ROMCC. Upon their return, petitioners objected to the transfer. Despite their objections, PLDT issued a memorandum transferring them to Sampaloc effective January 3, 1996. Petitioners went to Manila to air their grievance and seek union assistance. PLDT ordered them to report for work, later moving the effectivity date to March 1, 1996. After their appeals were unheeded, petitioners tendered their resignation letters on March 21, 1996, and PLDT deducted their training expenses from their final pay. Petitioners filed a complaint for constructive dismissal. The case was referred to a voluntary arbitrator, who, after PLDT failed to appear at scheduled hearings, admitted petitioners’ evidence and rendered a decision declaring the dismissal illegal, ordering reinstatement with backwages, refund of deductions, and damages. PLDT filed a petition with the Court of Appeals (CA), which reversed the arbitrator’s decision, except for the order to refund the deductions. Petitioners’ motion for reconsideration was denied.

ISSUE

The primary issues were: (1) whether the CA erred in treating PLDT’s special civil action for certiorari as a petition for review, and (2) whether the CA erred in its appreciation of facts and in reversing the voluntary arbitrator’s decision.

RULING

The Supreme Court granted the petition, reversed the CA decision, and reinstated the voluntary arbitrator’s decision. On the procedural issue, the Court held that while PLDT’s petition was captioned as a certiorari, its allegations and the fact that it was filed within the 15-day appeal period, did not implead the arbitrator, and included a registry receipt showing service to the arbitrator, indicated it was essentially a petition for review under Rule 43. The CA did not err in treating it as such. On the substantive merits, the Court found that the voluntary arbitrator correctly ruled that petitioners were constructively dismissed. Their transfer from Cebu to Manila, decided without their consent and despite their objections, constituted a demotion in rank and a diminution in pay, as it involved a change from their specialized functions to general duties. The Court emphasized that the employer’s prerogative to transfer employees must be exercised without grave abuse of discretion, with due regard to the employees’ rights and circumstances. The forced transfer left petitioners with no choice but to resign, making the dismissal illegal. The voluntary arbitrator’s factual findings, based on the evidence presented after PLDT waived its right to present evidence, were upheld.