GR 169564; (April, 2011) (Digest)
G.R. No. 169564 ; April 6, 2011
James Ben L. Jerusalem, Petitioner, vs. Hock, Sunny Yap and Josefina Picart, Respondents.
FACTS
Petitioner James Ben L. Jerusalem was employed by Keppel Monte Bank as Assistant Vice-President. He was initially assigned as Head of the VISA Credit Card Department but was later reassigned as Head of the Marketing and Operations of the Jewelry Department. In May 1999, while already in the Jewelry Department, he received a sealed envelope containing VISA card application forms from cardholder Jorge Javier and forwarded it to the VISA Credit Card Unit, which was then under different officers. A total of 67 applications from Javier were approved, and all subsequently became past due, causing the bank substantial financial loss. Upon discovering the delinquent status of these accounts in July 2000, Jerusalem proactively recommended to bank officials the filing of a criminal case against Javier, an audit of the approval process, and the freezing of Javier’s accounts. Despite these actions, the bank served Jerusalem a Notice to Explain on August 18, 2000, alleging he endorsed fictitious applicants. He explained he merely forwarded the applications as an endorsement, having no participation in their processing or approval. On September 26, 2000, he was terminated for breach of trust and confidence. Jerusalem filed a complaint for illegal dismissal. The Labor Arbiter ruled in his favor, a decision affirmed by the NLRC but later reversed by the Court of Appeals, which held the dismissal legal.
ISSUE
Whether the petitioner was legally dismissed on the ground of loss of trust and confidence.
RULING
No, the dismissal was illegal. The Supreme Court reversed the Court of Appeals and reinstated the NLRC Decision.
The Court held that for breach of trust and confidence to be a valid ground for dismissal, the act complained of must be work-related and must show that the employee is unfit to continue working for the employer. The loss of trust must be based on willful breach founded on clearly established facts. In this case, Jerusalem’s only participation was the act of forwarding the application forms to the proper unit after his reassignment. He had no involvement in the processing, evaluation, or approval of the fraudulent applications. His subsequent actions—recommending legal action against Javier and an internal probe—demonstrated good faith and concern for the bank’s welfare. The cause of the bank’s loss was the failure of the responsible VISA Credit Card Unit to properly scrutinize the applications, not Jerusalem’s mere endorsement. Therefore, there was no factual basis to conclude a willful breach of trust by Jerusalem. His dismissal was unjustified.