GR 214744; (March, 2018) (Digest)
G.R. No. 214744 . March 14, 2018
LA CONSOLACION COLLEGE OF MANILA, SR. IMELDA A. MORA, OSA, ALBERT D. MANALILI, AND ALICIA MANABAT, PETITIONERS, VS. VIRGINIA PASCUA, M.D., RESPONDENT.
FACTS
Respondent Virginia Pascua was engaged as a school physician by petitioner La Consolacion College of Manila, starting part-time in 2000 and becoming a regular full-time employee in 2008. On September 30, 2011, she was handed a termination letter citing retrenchment due to a decrease in enrollment and the need to downsize the health services staff to prevent serious business losses. The letter offered separation pay. Pascua contested her dismissal, questioning the criteria used, noting that a part-time physician was retained, and suggesting she could have reverted to part-time status.
Pascua filed a complaint for illegal dismissal. La Consolacion justified the retrenchment, explaining that Pascua’s position, being the highest-paid in the health services division, was targeted to achieve payroll savings. The Labor Arbiter ruled in favor of Pascua, declaring the dismissal illegal. The National Labor Relations Commission (NLRC) reversed this decision, upholding the retrenchment. The Court of Appeals then reinstated the Labor Arbiter’s ruling, prompting the petitioners to elevate the case to the Supreme Court.
ISSUE
Whether the retrenchment of respondent Virginia Pascua was valid and constituted a legal dismissal.
RULING
No, the retrenchment was illegal. The Supreme Court affirmed the Court of Appeals decision, holding that while an employer may terminate employment due to retrenchment to prevent losses, such action must be based on a fair and reasonable criterion. The employer bears the burden of proving the legality of the dismissal, including the existence of a lawful cause and the observance of fair and reasonable standards in selecting employees for retrenchment.
In this case, La Consolacion failed to establish that it used a fair and reasonable criterion. Its sole justification—that Pascua was the highest-paid employee in her division—was insufficient and arbitrary. The Court emphasized that retrenchment criteria must consider factors such as efficiency, seniority, physical fitness, age, and family circumstances. A criterion based solely on salary, without regard for an employee’s length of service, efficiency rating, or other relevant factors, is unreasonable. The retention of a part-time physician while dismissing a regular full-time employee further underscored the arbitrariness of the selection. Consequently, Pascua’s termination was declared illegal, entitling her to reinstatement, full backwages, and other monetary benefits.