G.R. No. 194813; April 25, 2012
Kakampi and its Members, Victor Panuelos, et al., represented by David Dayalo, Kakampi Vice President and Attorney-in-Fact, Petitioner, vs. Kingspoint Express and Logistic and/or MARY Ann Co, Respondents.

FACTS

The individual petitioners were drivers for respondent Kingspoint Express, a sole proprietorship owned by Mary Ann Co. They were dismissed on January 20, 2006, on grounds of serious misconduct, dishonesty, loss of trust, and acts inimical to the company. The charges included filing fabricated money claims with the NLRC, misleading co-workers to sign these claims, refusing to undergo a company drug test, and extorting money from co-workers. Bobby Dacara faced an additional charge for impregnating a household helper of the owner. The company issued notices to explain on January 16, 2006, giving the employees 48 hours to respond, and placed them under preventive suspension. The petitioners failed to submit their written explanations within the given period, after which they received uniform notices of dismissal.
The Labor Arbiter found several petitioners illegally dismissed, ruling the evidence for the charges was insufficient and unsubstantiated. The NLRC affirmed this, adding that the company failed to comply with procedural due process, particularly by not granting a reasonable period to respond. The Court of Appeals reversed, holding that the act of filing baseless complaints constituted willful disobedience and breach of trust, which are just causes for dismissal under the Labor Code. The CA also found that the company observed due process by issuing the notices.

ISSUE

Whether the petitioners were illegally dismissed, both on substantive and procedural grounds.

RULING

The Supreme Court affirmed the CA’s finding that there was a valid substantive cause for dismissal but modified the ruling regarding procedural due process. On substantive grounds, the Court agreed that the petitioners’ act of filing fabricated money claims against their employer constituted willful disobedience and breach of trust, which are just causes for termination under Article 282 of the Labor Code. This act was deemed inimical to the employer’s interests. The Court found the charges substantiated, distinguishing this from a simple filing of a complaint, as the claims were knowingly baseless.
However, the Court ruled that the employer failed to satisfy procedural due process. While notices were issued, the two-day period given to the employees to explain was not a “reasonable opportunity” as required by jurisprudence, which stipulates at least five calendar days. This procedural defect did not invalidate the dismissal for a just cause but rendered the employer liable for nominal damages. Consequently, the Court ordered Kingspoint Express to pay each of the petitioners (except those who did not appeal) nominal damages of ₱30,000 for non-compliance with the procedural requirements of termination.