G.R. No. 113178 & G.R. No. 114777. July 5, 1996.
RADIO COMMUNICATIONS OF THE PHILIPPINES, INC., ET AL., petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION and MARIO DANILO B. VILLAFLORES, respondents. (Consolidated with G.R. No. 114777)

FACTS

Mario Danilo B. Villaflores, Assistant Vice-President for Management Services of Radio Communications of the Philippines, Inc. (RCPI), was dismissed on grounds of gross misconduct and loss of confidence. The incident stemmed from a confrontation with German Mattus, a manager under his division but reporting directly to EVP Norberto Braga. On October 29, 1990, Mattus posted a seminar invitation on a bulletin board without Villaflores’s permission. Upon seeing it, Villaflores had his secretary remove it. An angered Mattus confronted Villaflores in a computer room. During the altercation, Villaflores attempted to throw a stapler, which was taken from him, and then tore the poster, throwing the pieces at Mattus while shouting invectives like “bullshit ka” and “gago ka.”
RCPI placed Villaflores under preventive suspension and, after investigation, terminated his services effective December 10, 1990, citing violations of company rules on threatening and inflicting injury on a fellow employee. Villaflores filed a complaint for illegal dismissal. The Labor Arbiter found the dismissal illegal, ruling the misconduct was not serious as Villaflores was provoked and no actual injury occurred. The NLRC affirmed but deleted the award of backwages and separation pay, ordering reinstatement instead. Both parties elevated the case to the Supreme Court via certiorari.

ISSUE

Whether the dismissal of Mario Danilo B. Villaflores on the grounds of gross misconduct and loss of confidence was valid and legal.

RULING

The Supreme Court ruled that the dismissal was illegal. The Court agreed with the Labor Arbiter and NLRC that Villaflores’s actions, while constituting misconduct, did not rise to the level of serious misconduct warranting dismissal. The act of attempting to throw a stapler and uttering invectives was a provoked reaction to Mattus’s disrespectful barging into the room and did not result in actual physical harm. For misconduct to be serious, it must be of such grave character as to show wrongful intent or perverse disposition, which was not present here.
Furthermore, the ground of loss of confidence was not substantiated. Loss of confidence must be based on willful breach of trust by an employee charged with fiduciary duties, and must be founded on clearly established facts. The single heated incident, provoked by a subordinate’s insubordination, did not constitute a willful breach that would justify dismissal of a managerial employee. The Court also noted that RCPI’s attempt to justify dismissal by citing Villaflores’s past alleged inefficiencies was unavailing, as the company had previously condoned such behavior by not taking timely action. Consequently, Villaflores was entitled to reinstatement with full backwages. However, due to the strained relations, the Court modified the NLRC decision by awarding separation pay in lieu of reinstatement, computed at one month’s salary for every year of service.