G.R. No. 180302 February 5, 2010
JIMMY ARENO, JR., Petitioner, vs. SKYCABLE PCC-BAGUIO, Respondent.

FACTS

Petitioner Jimmy Areno, Jr. was employed as a cable technician by respondent Skycable PCC-Baguio. On January 17, 2002, an accounting clerk, Hyacinth Soriano, filed a letter-complaint alleging that petitioner spread false rumors about her on two occasions in 2001 and again on January 7, 2002, when he allegedly stated she was seen going out with a supervisor and uttered, “Ikaw lang ang nakakaalam ng totoo” with malicious intent. Petitioner denied the allegations in his written explanation, stating his remarks were not made with malicious intent. After an administrative investigation on January 31, 2002, respondent found petitioner guilty and suspended him for three days without pay effective February 13-15, 2002. Petitioner refused to sign the suspension memo. He reported for work on February 13, 2002, the first day of his suspension. Respondent then issued a 1st Notice of Termination for insubordination. Petitioner submitted an explanation, and a further investigation was held on March 15, 2002. Respondent subsequently dismissed petitioner via a Final Notice of Termination dated April 1, 2002, on the ground of insubordination for willful disobedience of the suspension order. Petitioner filed a complaint before the Labor Arbiter challenging the legality of his suspension and dismissal. The Labor Arbiter dismissed the complaint. The NLRC initially reversed the Labor Arbiter, finding the suspension illegal based on hearsay evidence and a denial of due process, but upon reconsideration, reinstated the Labor Arbiter’s decision. The Court of Appeals affirmed the NLRC’s decision upholding the legality of the suspension and dismissal.

ISSUE

The primary issues are: (1) Whether the suspension of petitioner was based on hearsay evidence and effected in violation of due process; and (2) Whether petitioner’s dismissal for insubordination was valid.

RULING

The Supreme Court denied the petition and affirmed the decisions of the Court of Appeals and the NLRC. The Court held that the suspension was based on substantial evidence, not hearsay, as Soriano’s testimony during the administrative investigation was based on her personal knowledge of the January 7, 2002 incident where petitioner directly spoke to her. The Court found that petitioner was afforded due process as he was given notice of the charges, an opportunity to explain, and hearings were conducted. The suspension order was a lawful exercise of management prerogative. Petitioner’s act of reporting for work despite knowledge of the suspension order constituted willful disobedience, a valid ground for dismissal under Article 282 of the Labor Code. The Court emphasized that disciplinary action is a management prerogative, and judicial interference is warranted only if such action is oppressive or without legitimate business reasons, which was not the case here.