G.R. No. 201701 , June 3, 2013
UNILEVER PHILIPPINES, INC., Petitioner, vs. MARIA RUBY M. RIVERA, Respondent.

FACTS

Unilever Philippines, Inc. (Unilever) employed Maria Ruby M. Rivera as an Area Activation Executive. Unilever enforced a strict policy requiring all trade activities to be accompanied by a Trade Development Program (TDP) and that budgets must be used only for their designated activities. In 2007, an internal audit revealed fictitious billings and fabricated receipts from a third-party service provider, Ventureslink International, Inc., amounting to approximately ₱11,200,000. It was discovered that funds were diverted from their original projects, and Ventureslink reported that these deviations were upon Rivera’s instruction. Unilever issued a show-cause notice to Rivera, charging her with Conversion and Misappropriation of Resources, Breach of Fiduciary Trust, Policy Breaches, and Integrity Issues. Rivera admitted to the fund diversions via email, explaining that they were due to difficulty in procuring funds from the head office and that all diverted funds were used for company promotional ventures. Unilever found her guilty of serious breach of the company’s Code of Business Principles and terminated her employment. Rivera filed a complaint for illegal dismissal and monetary claims. The Labor Arbiter dismissed her complaint but ordered payment of proportionate 13th month pay and unused leave credits. The NLRC upheld the validity of her dismissal for just cause but found Unilever violated procedural due process, awarding nominal damages, retirement benefits, and separation pay. Upon reconsideration, the NLRC deleted the separation pay and reduced the nominal damages but affirmed the retirement benefits. Unilever filed a petition for certiorari with the Court of Appeals (CA). The CA affirmed the NLRC’s finding of valid dismissal but deleted the award of retirement benefits, citing Unilever’s Retirement Plan which disallows benefits for validly dismissed employees. However, the CA awarded separation pay to Rivera as a measure of social justice, noting no proof she gained personal pecuniary benefit from her infractions. Unilever appealed to the Supreme Court.

ISSUE

1. Whether the Court of Appeals erred in granting affirmative reliefs (separation pay) to Rivera despite her not filing a petition to challenge the NLRC resolutions.
2. Whether the Court of Appeals erred in awarding separation pay to Rivera, who was validly dismissed for just causes.
3. Whether the Court of Appeals erred in ruling that Unilever violated Rivera’s right to procedural due process and in awarding nominal damages.

RULING

1. On the grant of affirmative relief: The Supreme Court held that the CA did not err. The CA’s award of separation pay was not an affirmative relief granted to Rivera but a modification of the NLRC’s decision based on equitable grounds. The CA acted within its jurisdiction to review errors in the NLRC’s decision, even if Rivera did not appeal, as the issue was raised in Unilever’s petition.
2. On the award of separation pay: The Supreme Court reversed the CA’s award of separation pay. Separation pay is not warranted when an employee is dismissed for just cause, such as breach of trust. Rivera’s admission to diverting company funds constituted willful breach of trust, a valid ground for dismissal under Article 297 (formerly Article 282) of the Labor Code. The length of her service (14 years) does not mitigate the offense but may even aggravate it, as it reflects a higher degree of responsibility and betrayal. The CA’s reliance on “social justice” was misplaced, as it cannot be used to condone wrongdoing or override legal grounds for dismissal.
3. On procedural due process and nominal damages: The Supreme Court affirmed the CA’s finding that Unilever violated procedural due process. While Unilever issued a show-cause notice and Rivera responded, the company failed to provide a written notice of termination specifying the grounds and giving her a reasonable opportunity to be heard. This failure warranted the award of nominal damages, which the NLRC reduced to ₱20,000 and the CA upheld. The award is intended to deter employers from disregarding procedural requirements.
DISPOSITIVE PORTION:
The Supreme Court PARTIALLY GRANTED the petition. The CA’s award of separation pay was DELETED. The awards of nominal damages (₱20,000), proportionate 13th month pay, and unused leave credits were AFFIRMED. Rivera’s dismissal was declared VALID for just cause, and she is not entitled to retirement benefits or separation pay.