G.R. No. 95449 August 18, 1997
PHILIPPINE-SINGAPORE TRANSPORT SERVICES, INC., petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION and Capt. WENEFREDO N. ESTRADA, respondents.

FACTS

Petitioner Philippine-Singapore Transport Services, Inc. (PSTS), a manning agency, hired private respondent Capt. Wenefredo N. Estrada as master of the vessel “Sea Carrier I” for its foreign principal, Intra-Oil Supplies Sbn Bhd, on November 24, 1987. On January 21, 1988, Estrada was informed by an agent of the principal that he would be relieved and repatriated without explanation. He was replaced as captain that same day. Upon returning to Manila, PSTS informed him his termination was due to incompetence and denied his claims for unpaid salary and a deducted plane fare. Estrada filed a complaint for illegal dismissal. PSTS alleged the dismissal was for a valid cause—incompetence—as evidenced by telex complaints from the charterer about Estrada’s inability to handle the vessel for towing or approaching oil platforms, leading to the decision to terminate him and off-hire the vessel. Estrada countered that his refusal to obey a charterer order to tow another barge was justified because the mooring ropes were worn out and inadequate, a situation he had reported to a representative of Essar Shipping. The POEA ruled the dismissal illegal, ordering payment of salaries for the unexpired contract and a refund for plane expenses. The NLRC affirmed, finding the charge of incompetence unmeritorious and that the real reason was his justified refusal to tow the barge.

ISSUE

Whether or not private respondent Capt. Wenefredo N. Estrada was validly dismissed from service on account of alleged incompetence.

RULING

No. The Supreme Court held the dismissal was without just cause and without due process. The imputation of incompetence due to lack of foresight regarding mooring ropes was unworthy of credence. Estrada’s refusal to tow the barge was based on his professional opinion that the worn-out ropes were inadequate and would cause damage, a prudent act to secure the vessel’s safety. This did not constitute neglect of duty or serious misconduct. The employer’s right to dismiss is not absolute and must be exercised in good faith, with due regard to the rights of labor and the constitutional guarantee of security of tenure. Dismissal must be for a just cause under Article 282 of the Labor Code and with due process under Article 277(b). Since the dismissal was without just cause, Estrada was entitled to payment of salaries for the unexpired portion of his contract. The petition was dismissed and the NLRC Resolutions affirmed.