GR 162385; (July, 2013) (Digest)
G.R. No. 162385; July 15, 2013
SAMAR-MED DISTRIBUTION, Petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION, AND JOSAFAT GUTANG, Respondents.
FACTS
Petitioner Samar-Med Distribution, a sole proprietorship, employed respondent Josafat Gutang as a managerial employee. In 1996, Gutang filed a complaint for illegal dismissal and monetary claims, alleging unpaid salaries and allowances. Samar-Med countered that Gutang was not an employee but was merely permitted to sell its products, and that he had abandoned his work after being tasked to investigate a sales shortage. The company also asserted that Gutang had misappropriated company funds, for which a criminal case for estafa had been filed.
The Labor Arbiter ruled in favor of Gutang, declaring his dismissal illegal. The National Labor Relations Commission (NLRC) reversed this decision, finding that Gutang, a managerial employee, had committed serious misconduct by failing to account for substantial company collections, which constituted a just cause for dismissal under the Labor Code. The Court of Appeals subsequently annulled the NLRC resolution, reinstating the Labor Arbiter’s decision, upon finding that the alleged misappropriation was not sufficiently proven and that Gutang was illegally dismissed.
ISSUE
Whether respondent Josafat Gutang was illegally dismissed.
RULING
The Supreme Court granted the petition, reversing the Court of Appeals and reinstating the NLRC resolution. The Court held that Gutang was validly dismissed for a just cause but the employer was liable for nominal damages due to procedural infirmities.
On the substantive aspect, the Court found that Gutang, a managerial employee, committed serious misconduct warranting dismissal. The records, including signed official receipts and a voucher, established that Gutang received over ₱1.6 million from a provincial government on behalf of Samar-Med. His failure to account for these funds, leading to a criminal complaint for estafa supported by a prosecutor’s certification of probable cause, constituted a breach of the trust reposed in him. This act was a just cause for termination under Article 282 of the Labor Code.
However, the Court ruled that Samar-Med failed to comply with the twin-notice requirement of due process. The employer did not serve Gutang with a written notice specifying the charges and giving him a reasonable opportunity to explain, nor a subsequent notice of termination. Consequently, while the dismissal was for a just cause, the employer violated Gutang’s right to procedural due process. For this violation, the employer was held liable to pay nominal damages in the amount of ₱30,000.00, in line with prevailing jurisprudence. The award of backwages and separation pay was deleted.