G.R. No. 181146 ; January 26, 2011
THE UNIVERSITY OF THE IMMACULATE CONCEPTION and MO. MARIA ASSUMPTA DAVID, RVM, Petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION and TEODORA AXALAN, Respondents.

FACTS

Petitioner University of the Immaculate Conception is a private educational institution. Private respondent Teodora C. Axalan is a regular faculty member (Associate Professor II) and the elected president of the employees’ union. From November 18 to 22, 2002, Axalan attended a seminar in Quezon City on website development. She received a memorandum asking her to explain why she should not be dismissed for being absent without official leave (AWOL). Axalan claimed she held online classes during the seminar. The university president, through the Dean, offered not to file an administrative charge if Axalan would admit to being AWOL and write a letter of apology. Axalan refused. An ad hoc grievance committee was formed to investigate the charge.
From January 28 to February 3, 2003, Axalan attended another seminar in Baguio City on advanced paralegal training. She was again charged with AWOL. Axalan explained she sought approval from the Vice-President for Academics, who denied giving approval, stating only the university president could approve leave.
The ad hoc grievance committee found Axalan incurred AWOL on both instances and recommended a six-month suspension without pay for each charge, which the university president approved, imposing a total one-year suspension without pay effective immediately.
On December 1, 2003, Axalan filed a complaint against the university for illegal suspension, constructive dismissal, reinstatement with backwages, and unfair labor practice with damages and attorney’s fees. The university moved to dismiss, claiming the Labor Arbiter had no jurisdiction and that jurisdiction lay with a voluntary arbitrator. The Labor Arbiter denied the motion, holding that with no existing collective bargaining agreement, no grievance machinery was constituted, barring resort to voluntary arbitration. Axalan resumed teaching on October 1, 2004, upon the expiration of her one-year suspension.
The Labor Arbiter ruled on October 11, 2004, that the suspension amounted to constructive dismissal, ordering reinstatement without loss of seniority rights and payment of backwages, salary differentials, damages, and attorney’s fees totaling ₱543,452.00 plus 10% attorney’s fees. The NLRC affirmed the Labor Arbiter’s jurisdiction and decision. The Court of Appeals subsequently affirmed the NLRC’s resolutions.

ISSUE

1. Whether the voluntary arbitrator had jurisdiction over the labor dispute.
2. Whether Axalan was constructively dismissed.
3. Whether the Labor Arbiter’s computation of backwages, damages, and attorney’s fees was correct.

RULING

1. On Jurisdiction: The Supreme Court held that the voluntary arbitrator did not have jurisdiction. The Court found that the controversy was an employer-employee dispute, not a dispute involving the union and the university. Since there was no existing collective bargaining agreement and no grievance machinery was constituted, the Labor Arbiter properly exercised jurisdiction over the complaint for illegal suspension and constructive dismissal.
2. On Constructive Dismissal: The Supreme Court held that Axalan was not constructively dismissed. Constructive dismissal requires a clear act of discrimination, insensibility, or disdain by the employer that forces the employee to resign. The one-year suspension without pay, though severe, was a disciplinary penalty imposed after an investigation where Axalan was given the opportunity to explain. The penalty was for specific infractions (AWOL charges), not an unbearable act forcing resignation. Furthermore, Axalan promptly returned to work after the suspension ended, indicating no severance of employment.
3. On Computation of Backwages, Damages, and Attorney’s Fees: Given the finding that there was no constructive dismissal, the award of backwages, salary differentials, damages, and attorney’s fees was set aside. The Court noted that the university’s argument on the correct computation of backwages (based on Axalan’s average gross monthly income at the time of suspension, not the previous year) became moot.
DISPOSITIVE:
The petition was GRANTED. The Decision of the Court of Appeals dated December 13, 2007, and the Resolutions of the NLRC dated August 15, 2005, and October 24, 2005, were REVERSED and SET ASIDE. The complaint filed by Teodora C. Axalan was DISMISSED.