G.R. No. 198515, June 15, 2015
Dominador Malabunga, Jr., Petitioner, vs. Cathay Pacific Steel Corporation, Respondent.

FACTS

Petitioner Dominador Malabunga, Jr. was hired by respondent Cathay Pacific Steel Corporation on April 10, 1996, as a machinist. An inventory on July 9, 2004, revealed one aluminum level was issued to the company’s Fabrication Unit and another to petitioner. On July 11, 2004, petitioner returned an aluminum level to the warehouse. On July 24, 2004, respondent served a Notice upon petitioner, charging him with theft of the aluminum level issued to the Fabrication Unit. Respondent alleged petitioner stole the Fabrication Unit’s level and returned it to cover up the loss of the one issued to him. Attached to the Notice were statements from warehouse foreman Salvador Narvasa and warehouseman Reymundo Manuel Baetiong. Narvasa claimed that on July 13, 2004, he discovered the returned level was the one issued to the Fabrication Unit, and that during a meeting, petitioner remarked that if he stole it, the Fabrication Unit crew should be charged for negligence. Baetiong stated he was on duty when petitioner returned the level and later learned from Nonito Tercero, a Fabrication Unit worker, that the returned level was the one issued to that unit. In his written explanation, petitioner denied the accusation, insisting he returned the same level he borrowed, criticized the lack of secure identification markings on company tools, and noted the Fabrication Unit only placed a mark on the level days after the incident. During the investigation, sworn statements from Fabrication Unit employees Rodolfo Mangahas, Nonito Tercero, and Antonio Nagales were taken, all identifying the returned level as belonging to their unit based on a dent and an engraved marking. On December 2, 2004, respondent found petitioner guilty of serious misconduct under Article 282 of the Labor Code and company rules on theft, suspending him for 30 days and ordering him to pay ₱280.00 for the lost level. Petitioner’s Motion for Review was denied on February 18, 2005. Petitioner filed a complaint for illegal suspension and illegal deduction. The Labor Arbiter dismissed the complaint. The National Labor Relations Commission (NLRC) reversed the Labor Arbiter, finding the suspension illegal and ordering payment of backwages. The Court of Appeals (CA) reinstated the Labor Arbiter’s decision, prompting this Petition.

ISSUE

Whether the Court of Appeals erred in finding that respondent had just cause to suspend petitioner.

RULING

Yes. The Supreme Court granted the Petition, reversing the Court of Appeals and reinstating the NLRC Decision. The Court held that respondent failed to prove by substantial evidence that petitioner committed theft. The evidence presented was insufficient and unreliable. The identification of the returned tool as belonging to the Fabrication Unit was dubious; the sworn statements of the unit’s employees were taken only after the accusation and were inconsistent regarding the basis for identification (some citing a dent, others an engraving). The Court found respondent’s warehouse system disorganized and its personnel inept for lacking a proper procedure to identify and account for tools, such as secure markings. Petitioner’s act of returning a tool was a regular transaction, and the warehousemen accepted it without noting any defect or discrepancy. The accusation rested on mere suspicion and conjecture, not on proof of unlawful taking. An employer cannot blame employees for losses stemming from its own faulty system. Therefore, the suspension was illegal. The NLRC correctly ordered respondent to pay petitioner his 30-day backwages.