G.R. No. 147125 ; January 14, 2004
SHOPPES MANILA, INC., petitioner, vs. THE HON. NATIONAL LABOR RELATIONS COMMISSION, LABOR ARBITER ERMITA ABRASALDO-CUYUCA and LORIE TORNO, respondents.

FACTS

Petitioner Shoppes Manila, Inc., a garments manufacturer, employed respondent Lorie Torno as a trimmer. In 1997, the company received reports from co-employees accusing Torno and a colleague of stealing “KAMISETA” items. Following these reports, Torno agreed to a house inspection by her supervisor, who found several company materials, including fabrics and damaged shirt panels. Based on this, the company suspended Torno indefinitely without pay and subsequently issued a notice of dismissal, citing theft under company rules. Torno failed to attend a scheduled hearing to explain her side, leading to her termination.
Torno filed a complaint for illegal dismissal. The Labor Arbiter granted the petitioner’s motion for a formal hearing to examine witnesses. However, the hearing did not proceed due to absences. A new Labor Arbiter, Ermita Abrasaldo-Cu yuca, later declared the case submitted for decision without acting on the petitioner’s motion to reset the hearing. The Labor Arbiter ruled in favor of Torno, finding illegal dismissal due to denial of due process, a decision affirmed by the NLRC and the Court of Appeals.

ISSUE

Whether the Court of Appeals erred in affirming the findings that respondent Lorie Torno was illegally dismissed.

RULING

The Supreme Court denied the petition and affirmed the Court of Appeals’ decision. The Court held that the petitioner failed to comply with the twin-notice requirement and to afford the respondent substantive due process. The notice of dismissal was issued only after the indefinite suspension, and the subsequent hearing notice was for the respondent to explain further, not to answer the initial charges. This procedural defect violated her right to be heard. On substantive grounds, the evidence of theft was insufficient. The items found during the house inspection were described as excess cuttings, damaged materials, and used wallpapers, not finished products intended for sale. The petitioner failed to prove these were stolen property or that they were taken with dishonest intent, which is essential for a valid dismissal based on loss of trust and confidence. The findings of fact by the labor tribunals, as affirmed by the Court of Appeals, are conclusive. In a Rule 45 petition, only questions of law are reviewable, and the factual conclusions, supported by substantial evidence, are binding.